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Tim Lynch

Inside grand juries: Growing criticism over who controls the evidence

Here is a link to, “A Grand Facade: How the Grand Jury Was Captured by Government.”

Excerpt:

The prosecutor calls the shots and dominates the entire grand jury process. The prosecutor decides what matters will be investigated, what subpoenas will issue, which witnesses will testify, which witnesses will receive “immunity,” and what charges will be included in each indictment.

Because defense counsel are barred from the grand jury room and because there is no judge overseeing the process, the grand jurors naturally defer to the prosecutor since he is the most knowledgeable official on the scene. That overbearing presence explains the old saw that a competent prosecutor can “get a grand jury to indict a ham sandwich” if he is really determined to do so.

And the reverse also holds true: If a prosecutor does not want an indictment, he can secure that outcome if he is really determined to do so.

Randal O'Toole

The Highway Trust Fund hasn’t worked, says a new report from the Eno Transportation Foundation, so Congress should consider getting rid of it and funding all transportation out of general funds. In other words, the transportation system is breaking down because it has become too politicized, so we should solve the problem by making transportation even more political.

Eno (which was founded by William Phelps Eno, who is known as the “father of traffic safety”) claims this report is the result of 18 months of work by its policy experts. Despite all that work, the report’s conclusions would only make matters worse.

“The user pay principle works in theory,” says the report, “but has not worked in practice, at least as applied to federal transportation funding in the United States to date.” Actually, it worked great as long as Congress respected that principle, which it did from roughly 1956 through 1982. It only started to break down when Congress began diverting funds from highways to other programs. Then it really broke down when Congress, in its infinite wisdom, decided to spend more from the Trust Fund than it was earning from user fees. (It made the decision to spend a fixed amount each year regardless of revenues in 1998, but spending only actually exceeded revenues starting around 2008.)

Some argue that such breakdowns in the user-fee principle are inevitable when politicians get involved. This suggests that the government should get out of the way and let user fees work again. But Eno ignores that idea, and simply dismisses user fees altogether.

Eno suggests Congress has three options:

  1. Adjust spending to revenues, either by raising gas taxes or reducing spending.
  2. Fund some things out of gas taxes and some things out of general funds (which is more-or-less the status quo).
  3. Get rid of the Highway Trust Fund and just fund all transportation out of general funds.

“Any of these ideas would represent a dramatic improvement over the existing system,” says Eno, which isn’t true since the second idea is, pretty much, the existing system. But “based on our analysis, solution 3 is at least worth exploring.”

In fact, all of the problems with our transportation system are the result of politicians departing from the user-fee principle.

  • Crumbling infrastructure is the predictable result of political decisionmaking, because politicians would rather fund new infrastructure than maintain what they have.
  • Wasteful spending on grandiose capital projects that produce few benefits is the predictable result of giving special-interest groups more say over budgets than transportation users.
  • Increased congestion is the predictable result of the fact that so many of those special interest groups benefit from not solving the congestion problem.

Eno never considers the possibility of getting the federal government out of the transportation business, most of which is not interstate and doesn’t need federal involvement. The only mentions of “devolution” in the report are in a case study of United Kingdom transportation, which only involved a partial devolution and is far from committed to the user-fee principle as petrol taxes all go into general funds.

The report only mentions substituting vehicle-mile fees for gas taxes in order to dismiss it by saying that it would “require Congress to raise taxes.” Actually, it wouldn’t because those fees would be charged and collected by state and local agencies and private parties that own and operate the nation’s highways, roads, and streets. The only reason why the federal government is involved at all is because the federal government can cheaply charge taxes on gasoline at refineries and ports of entry, a benefit that disappears if we switch to mileage-based user fees.

Eno’s solution would take us out of the traffic jam and into total and complete gridlock. Politicians would merrily allocate funds to projects that enriched their pals and campaign contributors while doing nothing for mobility. Cities and states would eagerly propose the most wasteful projects they can find in order to get “their share” of the federal largess. Anyone daring enough to complain about congestion and deteriorating infrastructure would be told that it’s their own fault for using politically incorrect modes of transport. Those who really care about the nation’s transportation system need to look deeper than the authors of Eno’s report.

Randal O'Toole

The White House has applauded Portland, Ore., and 15 other local governments as “climate action champions” for promising to reduce greenhouse gas emissions. Perhaps the White House should have waited to see whether any of the communities managed to meet their goals before patting them on the back.

Portland’s “modest” goal is to reduce the city and Multnomah County emissions by 80 percent from 1990 levels by 2050. Planners claim that, as of 2010, the city and county had reduced emissions by 6 percent from 1990 levels. However, this claim is full of hot air as all of the reductions are due to causes beyond planners’ control.

Almost two-thirds of the reduction was in the industrial sector, and virtually all of that was due to the closure in 2000 of an aluminum plant that once employed 520 people. The closure of that plant hasn’t led anyone to use less aluminum, so all it did was move emissions elsewhere.

Another 22 percent of the reduction was in residential emissions, and that was due solely to 2010’s “anomalously mild winter” and below-average summer temperatures, as 2009 emissions were greater than those in 1990. Only 7 percent of the reduction was in the transportation sector, for which Portland is famous. But all of that reduction was due to the recession, not the city’s climate plan, as transport-related emissions grew through 2005 and the city didn’t record a reduction until 2009. 

Portland doesn’t have many more large factories that it can put out of business to achieve its climate goals. Nor can the city count on a continued economic depression to keep people from driving or an anomalously mild climate to keep people from turning on their heat or air conditioning.

The lesson here is that cities and counties are the wrong level to try to reduce emissions of something like greenhouse gases. This is a lesson we should have learned already based on our experience with toxic pollutants such as carbon monoxide and nitrogen oxides.

In 1970, Congress required urban areas with dirty air to write transportation plans that aimed to reduce air pollution. Since then, total tons of transport-related air pollution (carbon monoxide, nitrous oxides, sulfur dioxide, volatile organic compounds, lead, and particulates) have declined by 83 percent—and all of that decline came from making cleaner cars. If anything, too many regional transportation plans have made air dirtier by focusing on trying to get people out of their cars and using increased congestion as a tool for doing so. Cars pollute more in traffic congestion, but planners didn’t built that into their models, so they could claim that their plans would work when they actually didn’t.

Despite this failed record of trying to reduce air emissions at the city and county level, the White House is very grateful to Portland and other local governments for writing greenhouse gas reduction plans that make promises they won’t be able to keep. They will, however, be able to use those plans to increase transportation, housing, and other consumer costs. The cities consider that a small price to pay to be declared a climate action champion.

Nicole Kaeding

The federal government has a long history of “green energy” failures. Many states have also foolishly subsidized green energy, including Mississippi.

KiOR biofuels launched several years ago with much fanfare. The company was supposed to turn wood chips into liquid hydrocarbons for use as fuel and promised to revolutionize the energy industry. Its chief investor, Vinod Khosla, described KiOR’s refinery as “an amazing facility.”

The company benefited from a federal biofuel requirement that mandated refiners use 16 billion gallons of biofuels annually by 2022. It then sought out state subsidies. The company decided to locate in Mississippi after the state offered a $75 million, no-interest loan. In exchange, the company promised to create 1,000 jobs by December 2015.

Yet the company had financial problems that were apparent from the start. Operating costs  ran $5 to $10 a gallon. The Washington Post reports that court papers estimated KiOR’s revenue at just $2.25 million but losses of $629.3 million.  

Production issues also plagued the facility. The system that fed wood chips into the plant frequently malfunctioned. The process converted less than 40 percent of its inputs into gasoline or diesel, leading to higher costs.

The problems were too much for the company to overcome. It filed bankruptcy in November and  still owes Mississippi $69.5 million.

This loan is just one of the many types of energy subsidies that Mississippi provides to green energy companies. The state exempts some green energy manufacturers from taxes. It has provided grants and loans to multiple companies.

Former Mississippi governor Haley Barbour was in KiOR’s “cheering section” and drove Mississippi’s foray into green energy subsidies. Khosla leveraged Barbour’s central-planning approach to energy policy to benefit KiOR and ventures. Khosla invested in at least three other companies that received subsidies from Mississippi, including Soladigm (now View Inc.) and Stion. Khosla is no stranger to energy subsidies. Several of his other investments, including Range Fuels and Coskata, were also failures that benefited from loans from the federal Department of Energy and Department of Agriculture.

KiOR is not the first of Mississippi’s green investments to fail. Twin Creeks Technologies, a solar firm, received a $26 million loan from the state before it filed for bankruptcy.

Energy subsidies waste millions in state and federal dollars annually, but sadly policymakers have not yet learned their lesson.

Chris Edwards

There are many types of federal government waste. Perhaps the most glaring is spending on projects that simply do not work. The money is spent, but taxpayers receive no benefit.

From the Washington Post:

Social Security officials have acknowledged that the agency spent nearly $300 million on a computer project that doesn’t work. The agency, however, is trying to revive it. The program is supposed to help workers process and manage claims for disability benefits.

Six years ago, the agency embarked on an aggressive plan to replace outdated computer systems overwhelmed by a growing flood of disability claims. But the project has been racked by delays and mismanagement, according to an internal report the agency commissioned.

As a wild guess, let’s say that skilled computer techs cost $150,000 a year in wages and benefits. Apparently then, about 333 of them have been paid for six years, yet have made little or no progress on this mishandled Social Security project.

Here’s a much larger taxpayer black hole, also reported in the Washington Post this week:

One of the first casualties was the Crusader artillery program, which was canceled after the Pentagon spent more than $2 billion on it. Then there was the Comanche helicopter debacle, which got the ax after $8 billion. More than twice that amount had been sunk into the Army’s Future Combat System, but that program got killed, too.

In all, between 2001 and 2011 the Defense Department spent $46 billion on at least a dozen programs—including a new version of the president’s helicopter—that never became operational, according to an analysis by the Center for Strategic and Budgetary Assessments.

Any organization will go down some wrong paths when it comes to advanced technologies, but $46 billion is a remarkable amount to have sunk into dead-end projects. Let’s say that engineers, machinists, managers, and other workers at defense firms earn an average of $200,000 a year. The $46 billion lost would be like having a small city of 23,000 such high-skill people beavering away for a decade on projects that all end up in the trash bin. I’m not an expert on procurement, but I do know that is a lot of human talent for the government to waste.

Emma Ashford

Today at the Kremlin, Russian President Vladimir Putin gave his annual address to the Federal Assembly. The speech made the news for its antagonistic tone and, in particular, for Putin’s comparison of Crimea with Jerusalem. But for all the hype surrounding the speech, it said little new, emphasizing instead the impasse that Russia and the West find themselves locked in. Putin’s message was clear: Russia’s foreign policy is not changing.

The foreign policy narratives pervading the speech were strongly familiar, reiterating the points made by Russian leaders and state-owned television throughout the last year. Yet the twisted worldview presented bears little resemblance to reality.

Putin argued that Russia is being persecuted for seeking only to peacefully engage with the world. He presented Russia as a key proponent of international law, describing the annexation of Crimea as the result of a peaceful self-determination vote. In contrast, the United States was portrayed as a meddling hegemonic menace that, he insinuated, aids Russia’s enemies, foreign and domestic. Putin even implied that European states are vassals of the United States:

Sometimes it is even unclear whom to talk to: to the governments of certain countries or directly with their American patrons and sponsors.

The speech went on to describe international sanctions on Russia as illegitimate, with Putin arguing that sanctions are largely unrelated to Crimea or to the ongoing conflict. Instead, he insinuated, sanctions are an attempt by the United States to curtail Russia’s growth and power:

I’m sure that if these events had never happened… they [the US] would have come up with some other excuse to try to contain Russia’s growing capabilities.

These points aren’t true or accurate, but they are certainly consistent with the narrative advanced by the Kremlin. This is one key reason why Putin’s approval rate is still a massive 85%, with many Russians blaming the West for Russia’s woes. Putin thus spent much of the speech deflecting blame. In particular, he focused on Russia’s faltering economy, and while he touched on key economic concerns—the collapsing ruble, the falling price of oil, stalling economic growth, rising inflation—he largely glossed over them, focusing instead on blaming the West. 

But while the content of the speech was predictable, the tone offered more insight into Russian intentions. Putin’s tone remained defiant, signaling no change in policy. The speech invoked historical struggles, reminding citizens that they survived “containment” once before, during the Cold War. On the economic front, Putin highlighted new programs encouraging entrepreneurship and self-sufficiency in manufacturing and technology, as well as promising amnesty for capital returned to Russia from abroad. He even suggested that Russia may engage in import-substitution industrialization. 

Despite the slow-motion collapse of the ruble and other economic problems, the Kremlin has no intention of backing down on the issue of Ukraine. Instead, it will attempt to mitigate the economic crisis domestically. None of this is surprising, but it does highlight how unsuccessful U.S. strategy toward Russia has been over the last year. The poor performance of the Russian economy is at least as much the result of falling global oil prices as it is of sanctions. Yet neither has served to alter the foreign policy incentives of Russian leaders. 

Now is the time for a new approach to the Russia–U.S. crisis. Conflict over Ukraine serves the interests of neither side. Rather than adding to already ineffectual sanctions, U.S. policymakers should seek a negotiated settlement with Russia to end the crisis. Otherwise, the impasse will continue. 

Jim Harper

A couple of years ago I wrote here about the Supreme Court case denying that a person could collect damages from the government under the Privacy Act based on mental and emotional distress. It’s a narrow point, but an important one, because the harm privacy invasions produce is often only mental and emotional distress. If such injuries aren’t recognized, the Privacy Act doesn’t offer much of a remedy.

Many privacy advocates have sought to bloat privacy regulation by lowering the “harm” bar. They argue that the creation of a privacy risk is a harm or that worrisome information practices are harmful. But I think harm rises above doing things someone might find “worrisome.” Harm can occur, as I think it may have in this case, when one’s (hidden) HIV status and thus sexual orientation is revealed. It’s shown by proving emotional distress to a judge or jury.

Rep. Gerry Connolly (D-VA) has introduced the fix for the Supreme Court’s overly narrow interpretation of the Privacy Act. His Safeguarding Individual Privacy Against Government Invasion Act of 2014 would allow for non-pecuniary damages—that is, mental and emotional distress—in Privacy Act cases.

It’s a simple fix to a contained problem in federal privacy legislation. It’s passage would not only close a gap in the statute. It would help channel the privacy discussion in the right way, toward real harms, which include provable mental and emotional distress.

Chris Edwards

 

In his new book, Saving Congress from Itself, James Buckley argues that Congress should abolish the entire federal aid-to-state system to save money and improve American governance. A recent Cato study shows that there is substantial public support for reforms in that direction.

In “Public Attitudes toward Federalism,” John Samples and Emily Ekins review decades of polling data to discern views on federal policymaking vs. state/local policymaking. They find strong support for state/local primacy in many policy areas, including education, housing, transportation, welfare, and health care.

The authors find that Americans have become more strongly in favor of state/local control—as opposed to federal control—since the 1970s. For example, when asked whether “major decisions” about housing policy ought to be made at the federal level or state/local level, just 18 percent favor federal today compared to 28 percent four decades ago.

The political opening here is obvious: reformers on Capitol Hill should push to reduce the federal role—by cutting spending and regulations—in those areas where the public has a clear preference for state/local primacy. From constitutional and good governance perspectives, many federal agencies and programs ought to be eliminated, but the Samples/Ekins study indicates areas that reformers should target first.

Why is reviving federalism a politically appealing reform? Because the public has a much more favorable view of state/local governments than the federal government. Samples and Ekins find that 58 percent of people have a favorable view of local government, compared to just 32 percent for the federal government. Asked which level of government provides the most value for their tax dollars, 33 percent said the federal government and 67 percent said state/local governments. Asked whether government provides “competent service,” 31 percent agreed with regard to the federal government and 48 percent agreed with regard to local governments. On average, Americans believe that the federal government wastes 60 cents out of every dollar it spends.

The Samples/Ekins results show that self-identified Republicans have a stronger belief in decentralized policymaking than do Democrats. So reviving federalism is a ripe opportunity for the incoming Republican majorities in Congress.

***

George Will reviews Buckley’s book today in the Washington Post, and you can read more about federalism here.

Jason Bedrick

Over the weekend, Florida’s Sun-Sentinel editorialized against Florida’s scholarship tax credit law. But, as I detail at Education Next today, the editorial was rife with errors, distortions, and omissions of crucial context. Here’s just one example of many:

Rather than put the scholarship tax credit law in the context of Florida’s overall education spending, the Sun-Sentinel compares it to… Iowa.

“No state has a bigger voucher [sic] system. Last year, Florida spent $286 million on just 2.7 percent of all students. Iowa spent $13.5 million on 2.6 percent of its students.”

Setting aside the fact that the state of Florida did not “spend” even one red penny on the scholarships, this comparison is misleading. Do the editors at the Sun-Sentinel really believe that Iowa has as many students as Florida? If so, why haven’t they decried the fact that Florida spends more than $25 billion on its public schools while Iowa spends barely $5 billion? Perhaps because Florida has more than five times the number of students?

Comparing apples to apples, fewer than 10,500 students received tax-credit scholarships in Iowa last year compared to more than 69,000 in Florida. And while the tax-credit scholarships are larger in Florida than Iowa – about $4,660 on average versus about $1,090 on average – they are dwarfed by the more than $10,000 per pupil spent on average at Florida public schools.

The Sun-Sentinel owes its readers and the public a full and detailed retraction.

Ian Vásquez

Over the past couple of decades, a consensus has emerged among development practitioners and over a broad ideological spectrum about the need to legally recognize and protect the property rights of the world’s poor. Yet land tenure and the holding of other forms of property of billions of poor people remains informal.

As Peter Schaefer and Clay Schaefer explain in a Cato study released yesterday, one reason there has been little progress in titling or registering the property of the poor is that powerful interests in developing countries block reform. And in countries that have particularly predatory governments, there may be little actual demand to title property. Why would you publically register your property if the result will be confiscatory taxation, political persecution, or the need to pay bribes to avoid complying with prohibitively expensive regulations?

The authors propose a novel, bottom-up approach to registering property that gets around those problems: using a simple, hand-held GPS device, individuals in poor communities can inexpensively map their property claims in an informal community registry that is publically accessible on the internet. In the vast majority of cases, there is already a consensus about what informal property belongs to whom, so disputes on boundary issues that might arise are typically not significant and are readily solved. This community mapping approach is already partly being employed in parts of Africa and India. Because such registration is voluntary, it would only take place where people actually demand it; and because it is informal, it need not rely on unreliable government bureaucracies to make it happen.

Were communities to create “live” documents of their registries on the internet, as the authors propose, they would increase tenure security by providing useful information to investors, neighbors, multinational corporations and even governments. As Peter and Clay Schaefer note, “When a community achieves a critical mass of registered users, it will be very difficult for their governments to ignore the claims that have been recorded.” That approach will also make it more politically feasible for poor people to negotiate with the authorities and gain formal title to their property.

Christopher A. Preble

Although the rollout was messy, and the official announcement is still pending, the White House has settled on Ashton Carter to replace Chuck Hagel as secretary of defense. I have a piece just up at The Daily Caller explaining Carter’s long list of challenges: 

He will be expected to manage several ongoing wars, at a time when the public wants to kill bad guys without necessarily using U.S. ground troops to do it. Carter must also oversee numerous major new and costly weapons programs (especially nuclear weapons) in an increasingly tight budgetary environment. The Pentagon’s base budget (excluding the costs of the wars) remains near historic highs in inflation-adjusted terms, and personnel expenses are likely to remain high despite some reductions in the numbers of men and women serving in uniform. The just-released draft budget implements modest cost controls, but The Military Times reports that these “are likely to irritate outside advocates who pushed against any pay and benefits cuts.” Absent significant reform, military pay and benefits will place additional downward pressure on both new weapon R&D and normal operations and maintenance.

On top of all this, the rancor surrounding Hagel’s departure has shone new light on the White House’s tendency to micromanage foreign policy from the West Wing. It is reasonable to ask “Why would anyone want this job?”

Most of the piece focuses on the presumption that Carter will be more hawkish than his predecessor, based on his earlier support for a harder line against Iran (.pdf) and his call, in 2006 with William Perry, for so-called “preemptive” military strikes against North Korea.

But, as I explain, the hawks’ celebration might be premature. Hagel wasn’t unequivocally anti-war, and Carter will have his hands full with the wars U.S. troops are already fighting, plus the looming budgetary train-wreck. And those aren’t the only things constraining the new SecDef’s supposed hawkishness. Americans harbor deep doubts about replaying the past decades’ nation-building adventures in Iraq and Syria, and the nation’s senior military officer – JCS Chair Martin Dempsey – seems to share at least some of their concerns.

I conclude:

Given all of the things on Ash Carter’s plate, a logical division of labor would put him in charge of managing the Pentagon’s budget, and Dempsey in the forefront explaining how these resources should be deployed. The hawks in and out of Congress are reluctant to criticize the judgment of uniformed military personnel, and Americans remain wary of sending U.S. troops into the middle of distant civil wars. If Dempsey advises against greater U.S. involvement in such wars, he might have a bigger impact on the course of U.S. foreign policy than any of his civilian counterparts – Ashton Carter included.

Read the whole thing here.

 

Kat Murti

On December 5, 1933, the 21st Amendment to the Constitution was ratified, ending our nation’s failed experiment with alcohol prohibition. Yet, 81 years later, modern-day prohibitionists continue to deny the laws of supply and demand, attempting to control what individuals can choose to put into their own bodies.

The War on Drugs is a glaring example of contemporary prohibitionism, but nanny-staters have even attempted to ban substances as innocuous as “too-large” sodas or gourmet cheeses.

This Friday, join the Cato Institute for a look at prohibition 81 years after the repeal of the 18th Amendment.

 

I will be moderating a panel featuring Cato Senior Fellow Walter Olson, editor of the nation’s oldest law blog Overlawyered.com; Stacia Cosner, Deputy Director of Students for Sensible Drug Policy; and Michelle Minton, Fellow in Consumer Policy Studies at the Competitive Enterprise Institute. Panelists will discuss modern prohibitions—from the Drug War to blue laws, and from tobacco regulation to trans fats—drawing connections with their earlier antecedent.

Alcoholic beverages and other commonly restricted refreshments (bring on the trans fats!) will be served following the discussion.

What better place to celebrate the 81st anniversary of the repeal of Prohibition than the Cato Institute? Space is limited, so make sure to register for your chance to go home with a commemorative door prize.

Not in D.C.? The panel will be live-streamed and questions may be submitted via Twitter using #CatoDigital.

#CatoDigital (formerly #NewMediaLunch) is a regular event series at the Cato Institute highlighting the intersection of tech, social media, and the ideas of liberty. Email Kat Murti at kmurti [at] cato [dot] org to get future event updates and more.

Ilya Shapiro

For decades, courts have been struggling to reconcile two conflicting theories of what constitutes unlawful discrimination. The first theory, often called “disparate treatment,” reflects the commonly understood meaning of “discrimination.” Under this theory, a government action discriminates—violates the principle of equal protection or equality under the law—if it explicitly or implicitly treats members of one race or other special group differently from others. Examples of disparate treatment include Jim Crow’s black codes, university admission caps and quotas, and policies excluding women from certain positions.

The second theory, known as “disparate impact,” argues that the definition of discrimination should be much broader and include laws and policies that, while neutral in their application and operation, disproportionately harm members of a specific group. An example of a rule that would be considered discriminatory under this theory, but not under disparate treatment, would be a requirement that all soldiers in a particular unit be over six feet tall—because, as a statistical matter, far fewer women would be eligible than men. In several other cases, Cato has argued that allowing disparate impact theory claims against government bodies is problematic because a government can assure that a rule doesn’t accidentally produce statistically unequal outcomes is to engage in intentionally discriminatory policies—like quotas—that can ensure a specific outcome.

Here is the case that proves this point: Buffalo makes promotions within its fire department on the basis of both merit and seniority. Firefighters who wish to be considered for advancement have to pass a set of exams. Those who are successful are placed on a list of candidates eligible for promotion within a set time period. If a candidate isn’t promoted within that period, however, the promotion qualification expires and he’s forced to re-take the exams.

During one administration of the exam, the only successful candidates were white. Because that was statistically unlikely given the racial makeup of the department, the city feared that if it promoted the successful candidates, it would be sued for having a policy that had a disparate impact on non-white firefighters. Its solution was to make a racially based decision not to promote any of the qualified candidates, allowing their promotion-list placements to expire.

In a litigation battle that has progressed in fits and starts over many years, Cato has now joined the Pacific Legal Foundation and other concerned groups on a brief reminding the New York Court of Appeals (that state’s highest court) that allowing government to engage in disparate treatment to avoid accusations of disparate impact simply trades one form of discrimination for another. And, as Chief Justice John Roberts wrote for a Supreme Court plurality back in 2007, the way to stop discrimination on the basis of race is to stop discriminating on the basis of race.

The New York Court of Appeals will hear argument in the case of Margerum v. City of Buffalo on January 6 in Albany. For more on the “war between disparate impact and equal protection”—in the context of a previous firefighter-promotion case—see this prescient essay by Kenneth Marcus in the 2009 Cato Supreme Court Review.

Brink Lindsey

Here are the final five essays in the Cato Institute’s online forum on reviving growth:

1. Reihan Salam wants to end the bias in favor of corporate debt – and expand school choice.

2. Peter Howitt calls for flat taxes on consumption and wealth.

3. Ben Wildavsky thinks we are subsidizing the wrong college students.

4. Philip Auerswald targets barriers to home healthcare delivery.

5. George Selgin explores alternatives to the monetary policy status quo.

 

 

 

 

Chelsea German

According to a recent Gallup survey, the majority of Americans think that crime is on the rise. This misperception persists year after year. Only 21 percent of Americans realize that crime is actually falling. Consider murder and rape alone:

Murder and rape are not the only crimes that are falling. The downward trend in U.S. crime rates also holds for simple and aggravated assaults as well as robberies. Crime, in other words, is falling across the board.

 

 Furthermore, the fall in crime is not limited to the United States. Globally, crime is down. For example, consider the homicide rate in Europe over the last century:

 

Why do most people perceive the world as increasingly crime-ridden despite statistical evidence to the contrary?

Harvard professor and HumanProgress.org advisory board member Steven Pinker provided a number of reasons for our deeply ingrained pessimism during a recent Cato event, “If Everything is Getting Better, Why Do We Remain So Pessimistic?” which can be viewed here. His book, The Better Angels of Our Nature, offers a more in-depth look at the decline of violence.

Daniel J. Mitchell

Let’s look at some fiscal data that must be very depressing for President Obama and other advocates of big government.

Which means, of course, that this information must be very good news for American taxpayers!

Here’s a chart looking at annual federal spending since 2000. You’ll notice that spending skyrocketed from 2000-2009 (a time when libertarians were justifiably glum), but look at how the growth of government came to a screeching halt after 2009.

Here are some specific numbers culled from the OMB data and CBO data. In fiscal year 2009, the federal government spent about $3.52 trillion. In fiscal year 2014 (which ended on September 30), the federal government spent about $3.50 trillion.

In other words, there’s been no growth in nominal government spending over the past five years. It hasn’t received nearly as much attention as it deserves, but there’s been a spending freeze in Washington.

Now let’s look at what happens when government is put on a diet.

I’ve periodically discussed my Golden Rule, which says that good fiscal policy takes place when government spending grows slower than the private sector.

And even though we haven’t had impressive growth during the Obama years, there have been modest increases in both nominal GDP as well as inflation-adjusted (real) GDP.

In other words, the Golden Rule has been in effect since 2009. As a result, the burden of government spending, relative to the economy’s productive sector, has been declining.

Here’s another chart that will be very depressing for the President and other statists.

What’s really remarkable is that we’ve seen the biggest drop in the burden of government spending since the end of World War II.

Heck, the fiscal restraint over the past five years has resulted in a bigger drop in the relative size of government in America than what Switzerland achieved over the past ten years thanks to the “debt brake.”

At this point, some readers may be wondering who or what deserves credit for this positive development. I’ll offer a couple of explanations.

The first two points are about why we shouldn’t overstate what’s actually happened.

1. The good news is somewhat exaggerated because we had a huge spike in federal spending in 2009. To use an analogy, it’s easy to lose some weight if you first go on a big eating binge for a couple of years.

2. Some of the fiscal discipline is illusory because certain revenues that flow to the Treasury, such as TARP repayments from banks, actually count as negative spending. I explained this phenomenon when measuring which Presidents have been the biggest spenders.

But there also are some real reasons why we’ve seen genuine spending restraint.

3. The “Tea Party” election of 2010 resulted in a GOP-controlled House that was somewhat sincere about controlling federal outlays.

4. The spending caps adopted as part of the debt limit fight in 2011 have curtailed spending increases as part of the appropriations process.

5. In the biggest fiscal loss President Obama has suffered, we got a sequester that reduced the growth of federal spending.

6. Many states have refused to expand Medicaid, notwithstanding the lure of temporary free money from Uncle Sam.

7. Government shutdown fights may be messy, but they tend to produce a greater amount of fiscal restraint.

And there are surely other reasons to list, including the long-overdue end of seemingly permanent unemployment benefits and falling defense outlays as forces are withdrawn from Iraq and Afghanistan.

The bottom line is that the past five years have been a victory for advocates of limited government.

But now for the bad news. All this progress will be wiped out very quickly if there’s not genuine entitlement reform.

The long-run fiscal forecasts, whether from the Congressional Budget Office or from international bureaucracies such as the IMFBIS, and OECD, show that America will become a European-style welfare state over the next couple of decades in the absence of significant changes to programs such as Social Security, Medicare, Medicaid, and Obamacare.

So let’s enjoy our temporary victory but work even harder to avert a future fiscal crisis.

Matthew Feeney

Some of the appeal of the so-called “sharing economy” is that it allows providers to earn money with assets that would otherwise not be used. Thanks to Uber, Lyft, and Airbnb, a car that would normally sit in the driveway and a spare bedroom can both be used to make some extra money with relative ease. According to Uber, the May median annual income for its full-time New York City rideshare drivers is $90,766 (although this figure has been contested), well above the New York City median income of $46,540. This figure may appeal to those who might want to be an Uber rideshare driver, even if only part-time. However, data released by Uber shows that in order to make a predictable income as an UberX driver in New York City you will have to work long hours.

Yesterday, Uber released the following graph: 

 

The graph is based on data gathered from what Uber described as “a randomly selected sample” of New York City UberX drivers during the week of November 3rd. The y-axis shows the drivers’ average hourly post-deduction wage and the x-axis shows the number of hours worked per week. 

Uber’s post highlights that the average hourly wage for New York City UberX drivers for the November 3rd week remained relatively constant regardless of the number of hours worked. According to Uber, “the average earnings per hour for a driver who’s online for 5 hours is roughly the same as the average for a driver who’s online for 65 hours.”

However, Uber’s data suggests that if UberX drivers want a reliable income they will have to work more hours. The second graph released by Uber shows how much the drivers shown in the first graph would earn in a year if they worked the same number of hours for 50 weeks. 

As Slate’s Alison Griswold has pointed out, this graph shows that the more hours you work as an UberX driver in New York City the more reliable your average hourly income becomes. For instance, New York City UberX drivers working more than 70 hours a week for 50 weeks can expect to earn between $70,000 and $90,000 per year. Yet, the graph also shows that if you are working as an UberX driver in New York City part-time (less than 40 hours a week), your income is much less predictable.

UberX is understandably an attractive option for those who want to earn some money in their spare time. But what Uber’s own data reveals is that part-time UberX drivers should not expect a more predictable income than those who rideshare on a full-time basis.

Walter Olson

President Obama’s newly announced police-reform package lives up to one’s worst expectations. He flatly refuses to curtail the federal police militarization program, instead calling for a big hike in federal spending on aid to local departments with the usual micromanaging strings attached. These strings will predictably make departments more responsive to Washington, and lobbies with clout there, as distinct from their local communities. As USA Today notes, one powerful interest group has been especially active behind the scenes: “The Fraternal Order of Police, the nation’s largest police union, has waged an intense lobbying campaign to keep the surplus equipment flowing,” with its executive director specifically speaking up in favor of the transfer of armored vehicles and personnel carriers.  A Washington Post editorial notes that while the administration has now released some useful information on the Pentagon’s 1033 surplus-gear program, it still apparently has no plans to improve data gathering on police use of lethal force. 

In a related story that shouldn’t be missed, Conor Friedersdorf assembles excessive-force and misconduct horror stories of cops reinstated in union arbitration proceedings from Oakland, Philadelphia, Pittsburgh, Miami, Sarasota, and elsewhere around the country. He concludes:

I’d rather see 10 wrongful terminations than one person wrongfully shot and killed. Because good police officers and bad police officers pay the same union dues and are equally entitled to labor representation, police unions have pushed for arbitration procedures that skew in the opposite direction. Why have we let them? If at-will employment, the standard that would best protect the public, is not currently possible, arbitration proceedings should at a minimum be transparent and fully reviewable so that miscarriages of justice are known when they happen. With full facts, the public would favor at-will employment eventually.

You can’t tackle the excessive force problem credibly unless you tackle the power of the police unions. Period. 

[adapted from a post at Overlawyered]

Nicole Kaeding

Inspectors General (IGs) serve an important purpose within the federal bureaucracy. They are supposed to be independent, internal watchdogs that guard against fraud, corruption, waste, and other failures. But based on the recent actions of some Inspectors General, their independence is being questioned.

Congress created the system of Inspectors General in 1978 with support from both parties and President Carter. The 72 IGs monitor agency activities and report on agency malfeasance.  Many IGs are appointed by the president to shield them from agency interference.

In theory, IGs are supposed to crack down on waste, but IGs are often too soft on their agencies. Complaints have increased over the last several years. The Washington Examiner discusses the issue:

In the past two years, IGs at a half-dozen Cabinet-level agencies have been accused of retaliating against whistleblowers or softening their findings to protect top department executives or the White House.

Damning information about high-level misconduct has been scrubbed from recent IG reports at the Departments of State, Defense, Homeland Security, Interior and a slew of independent agencies, according to congressional reports and outside watchdog groups.

The Commerce IG has been rebuked for retaliating against his own people by the U.S. Office of Special Counsel and two congressional committees.

At the Department of Veterans Affairs, the acting inspector general is under fire for downplaying whistleblower claims and absolving the agency of blame for patient deaths in a high-profile report, even though the report confirmed that the VA used phony scheduling practices that led to delays in care.

Whistleblowers who have turned to Congress or the media routinely say inspectors general failed to investigate their charges of wrongdoing and then idly watched as their bosses subjected them to brutal retaliation for exposing agency secrets.

Even investigators within IG offices have faced retaliation for reporting internal wrongdoing or attempts to withhold embarrassing findings, according to congressional reports.

IGs are supposed to be guardians of the public interest, but sometimes they are the opposite. Congress has even had to use its subpoena power to force IGs to release documents and reports in some cases.

IGs serve an essential function ensuring that taxpayer funds are spent wisely, but many IGs are falling short on their oversight responsibilities. If they refuse, who will watch the watchdogs? As James Madison wrote in Federalist 51, “”In framing a government which is to be administered by men over men…, you must first enable the government to control the governed; and in the next place oblige it to control itself.”

Brink Lindsey

Here are today’s new essays in the Cato Institute’s online forum on reviving growth:

1. Edward Glaeser targets land use restrictions – and five other barriers to growth.

2. Susan Dudley wants to reform the regulatory process.

3. James Pethokoukis takes aim at the crony capitalist alliance.

4. Andrew Kelly calls for better integration of school and work.

5. Bowman Cutter looks for a path to the “good economy.”

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