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Dalibor Rohac and Marian L. Tupy

As the U.S. President Barack Obama prepares to meet 50 African leaders on Wednesday, August 6, it is worth reflecting on the factors behind the recent progress occurring in countries of Sub-Saharan Africa. As we write in our new paper,

The real gross domestic product [in Sub-Saharan Africa] rose at an average annual rate of 4.9 percent between 2000 and 2008 — twice as fast as that in the 1990s. […] As a result, between 1990 and 2010, the share of Africans living at $1.25 per day or less fell from 56 percent to 48 percent, while the continent’s population almost doubled in size. If the current trends continue, Africa’s poverty rate will fall to 24 percent by 2030.4 Since 1990 the per-capita caloric intake in Africa increased from 2,150 kcal to 2,430 kcal in 2013.5 Between 1990 and 2012, the proportion of the population of African countries with access to clean drinking water increased from 48 percent to 64 percent.

Although Sub-Saharan Africa is also becoming more democratic and better governed, a large gap between the quality of its institutions and those in the West persists. The continent remains, for example, economically unfree and heavily protectionist, not just vis-à-vis the outside world but also within the continent. For 25 African countries, the tariff costs of exporting or importing manufactured goods are higher within Africa than with the rest of world.

While international summits cannot not solve Africa’s internal problems, our paper argues that the upcoming meeting is a good opportunity for the U.S. administration to eliminate the existing trade barriers facing African exporters – regardless of whether they come in the form of explicit tariff barriers or implicit ones, such as agricultural subsidies:

[T]he elimination of the existing barriers to trade should be at the forefront of the efforts to help. Such barriers include tariffs, particularly on agricultural exports, which make it difficult for African economies to fully exploit their comparative advantage. As Brookings Institution researchers Emmanuel Asmah and Brandon Routman note, the structure of the tariff protection in the United States — but also in the European Union — is a significant part of the problem. The tariffs imposed up to a certain amount of imports may be low, yet the tariffs imposed for imports above the permitted quota might be very steep, in some cases up to 350 percent. Furthermore, agricultural subsidies in rich countries cause surplus production, which is often dumped on the world markets, depressing prices and undermining the livelihood of farmers in poor countries.

Doug Bandow

BEIJING, CHINA—Everything in China is big.  Including the battle over its future.

I recently returned from the People’s Republic of China.  It’s always a fascinating place with a future as yet unresolved. 

The country is growing economically, but no one really believes the government’s statistics.  The “one child” policy has created a birth dearth that may leave the PRC old before it grows rich. 

The PRC’s future is not yet determined.  Politics remains authoritarian, and it isn’t obvious that democracy would yield a meek Beijing. Nationalism could become an even more dangerous force without the current government’s power to close off discussion. 

Nevertheless, the young are restless.  Those I met had little patience with the Chinese Communist Party. 

Many hoped to go to America for school, for both its educational opportunities and personal freedoms.  Moreover, they weren’t afraid to speak out in front of others.

I was talking with some students about economic policy and how politics works (and fails!) in America.  One young man blurted out:  “I prefer elections, like in America for Congress.” 

No one spoke up for government control over what people could read or study.  I travel the world and normally have no trouble visiting any website, no matter how controversial, wherever I am. 

So I wasn’t thinking about the Great Firewall of China when I initially logged on after arriving.  But I couldn’t get onto Twitter—so much for tweeting about my experiences in the PRC. 

I mentioned my experience to a student heading off to the U.S. to attend university.  He snorted in disbelief:  “didn’t you know the PRC censored the internet?”  I said yes, but had forgotten.  After all, I’d been to Turkey, Egypt, Nigeria, and Kyrgyzstan, among other nations this year, and had enjoyed unimpeded access everywhere else. 

Another student offered me a program that disguised one’s browsing and allowed full access, even to nominally forbidden sites.  No passive acceptance of authority there!

I was talking with a group of Chinese university students and one of the women lamented government information controls and asked me what I thought.  While I said it wasn’t my place to tell the Chinese authorities what to do—I presumed the walls had ears and didn’t want to cause problems for those who got us together—I opined that most Americans believed openness to information and debate was the best strategy for economic, political, and social development.  I suggested that she should make her views known to her government. 

One young man asked where he could find my articles.  I gave him a couple of websites.  He then asked if he could actually view them in China and was relieved when I said yes. 

Perhaps the most dramatic moment was when a student asked me—in front of others during an economic discussion—about “the events of 1989.”  Why had the protestors gathered, he asked?  I kept my answer short and explained that they wanted political liberalization.  “Wow,” he exclaimed, and then seemed lost in thought. 

The PRC is a complicated civilization with a venerable heritage in rapid transition to somewhere, but no one is quite sure where.  China has shown how market liberalization creates growth and empowers the poor.

Alas, it is evident that market liberalization is not enough to create a free society.  But as I write in my new American Spectator article:  “the CCP seems to be losing the younger generation.  Those who make up the future of China want to decide their own futures.”

What this means for the PRC, its neighbors, and the rest of us remains to be seen.  “May you live in interesting times,” runs the famous Chinese curse.  We all are living in those times today.

Jim Harper

In response to my “Twitter fight!” blog post from Wednesday, Harvard Law Professor Lawrence Lessig charges me (in a post entitled “#Escapethe1990s”) with living in the campaign finance debates of the 1990s and urges me to escape them. There’s a better knock on me: I live in the 1790s, when the Bill of Rights was adopted, like some kinda freak!

Lessig really wants me to rely on modern Supreme Court precedents to argue that public funding of electioneering is unconstitutional: “And I challenge Harper to offer one bit of actual authority to counter that statement beyond his ‘this is the way I wish the Constitution were interpreted’ mode of argument,” he says, in “I-really-mean-it” bold.

I’ve had similar challenges to my starry-eyed and—I’ll confess—ideologically driven view of the Constitution. (I’m biased in favor of liberty.) For about a year, supporters of NSA spying bandied Smith v. Maryland “Supreme Court law,” saying that a person has no Fourth Amendment interest in phone calling data—until Judge Leon undercut them. Needless to say, the Court got its rationale wrong in Smith. Applying Smith to NSA spying is wrong. To the extent precedents might allow public funding of electioneering, they are wrong, too.

Professor Lessig devotes a good deal of time to the compromise he and others have made with conservative opponents since the ’90s. Perhaps because I’m not a conservative, but a libertarian, I don’t feel as though I owe it to them to come their way. To Lessig’s credit, he is not doubling-down on a bad idea, as others are, by seeking a constitutional amendment to allow government regulation of political speech. (The bill at the link was introduced Tuesday.)

What is most interesting is his utter certainty that an intricate scheme to mask government subsidy for political speech is good enough to slide over the First Amendment’s bar on “abridging the freedom of speech.” I thought I did a pretty good job on the subsidy question the first time, but I’ll do it again: Under Lessig’s plan, if you give money to a politician, you pay less in taxes. If you don’t give money to a politician, you pay more in taxes. Government tax policy would funnel money to politicians for their campaigns. That’s subsidy.

Lessig is right that his proposal doesn’t “abridg[e]” “speech.” But the First Amendment bars something more: “abridging the freedom of speech.”

As used in the phrase, “speech” is a mass, or non-count, noun. Modifying “freedom” from its prepositional perch, it makes “freedom of speech” non-count as well. “The freedom of speech” is a mass of freedoms—”this mass of freedoms right here,” the Framers said by putting a definite article (“the”) ahead of it. This should incline us to look at freedom of speech as practiced at the time of the Framing. Political campaigns were not government subsidized. (Incidentally? Sure. But Lessig says, “The whole purpose of the Post Office, originally, was to subsidize political speech.” Come now. Political speech follows commerce and communications, of course.)

Freedom of speech isn’t simply freedom to speak, which would be fulfilled when the greatest number of words were uttered. Freedom of speech gathers together the rights to speak, to record, to write, to type, to think, to sell books, to buy books, to pay for others’ speech, to operate a press or blog, to edit, to copy, to leaflet, to not leaflet, to refrain from speaking, and more. The right to refrain from speaking includes a right against being required to pay for others’ speech.

Chances are not good that Professor Lessig and I will convince one another on these issues. The effort is to entertain and persuade others, and for me to draw his audience to my side. I encourage readers—even those Lessigites whose starting point is to be really angry at me—to make their own decisions about what the Constitution and our traditions mean.

Given access to sufficient data, which many people are working on, I’m confident that the Internet—meaning all of us—can oversee the government much better than we do and produce better results. This makes transprency a more important, and speech friendly, reform than government management of political speech.

A final point, of utmost importance! (Facetiousness, ICYMI.) Professor Lessig came to Cato advocating for public funding, and splashing the phrase across Professor Richard Epstein’s face, in 2010.

Simon Lester

One point that I think gets overlooked in the Ex-Im Bank debate is whether we would create the bank today, if it did not already exist. If there were no export credit agencies out there already, what would the discussion over whether to start one look like? I have a difficult time believing that, based on current understandings of finance markets, a proposal to start using government-run export credit banks would gain any traction today.

So what we really have is a program that was created many years ago, vested interests have emerged to fight its repeal, and the practice has spread around the world. It’s basically just status quo bias that is keeping Ex-Im around, as I argue in this HuffPo piece:

It is difficult to imagine that we would create an Ex-Im Bank today if none existed. Yet we cannot seem to get rid of it.

The Ex-Im Bank was created in 1934, at a time when finance markets were undeveloped and international trade was filled with uncertainty. This was also a time of growing economic intervention in the economy, centered around the New Deal. As the Ex-Im Bank itself explains, “The Export-Import Bank was established by President Franklin D. Roosevelt, in 1934, as a New Deal program and to support his foreign policy.”

In the ensuing decades, economic thinking has changed radically, as our understanding of markets has grown. While it is possible that financing was simply not available for certain transactions at the time of Ex-Im’s creation, it is difficult to believe this is the case today. Finance is a sophisticated field with numerous options. If financing is not available for a particular transaction, it is almost certainly because the sale is not commercially viable. As The Economist recently put it, “The scarcity of private financing for certain exports reflects genuine risks that taxpayers are forced to assume.”

Of course, this problem of overcoming the status quo occurs in other policy areas as well. No doubt this blog’s readers can think of many examples where programs exist and linger on, even though they could never generate the support to start them today.

Paul C. "Chip" Knappenberger and Patrick J. Michaels

Global Science Report is a feature from the Center for the Study of Science, where we highlight one or two important new items in the scientific literature or the popular media. For broader and more technical perspectives, consult our monthly “Current Wisdom.”

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With its 2007 ruling in Massachusetts vs. EPA, the U.S. Supreme Court opened the door for the U.S. Environmental Protection Agency to regulate carbon dioxide emissions under the 1990 Clean Air Act Amendments. But to meet the Supremes’ criteria for regulation, EPA first had to find that the emissions of carbon dioxide and other greenhouse gases were an “endangerment” to public health and welfare. While the sitting Bush administration was reluctant to do this, President Obama’s EPA made the “preliminary” finding of endangerment a mere 94 days after his inauguration.

The “final” Endangerment Finding came on December 7, 2009, just in time to provide the United States credibility at the then-starting Copenhagen Conference, a United Nations affair at which a replacement to the failed Kyoto Protocol was to be enshrined. The meeting was the most disastrous yet for global warming hawks, but President Obama quickly declared victory and rushed off on Air Force-1, in order to beat what was to be the first of three bona fide blizzards in Washington that winter. He lost that race, too.

A torrent of regulations followed, “culminating” in EPA’s recent proposal to regulate greenhouse gas emissions from existing electric power plants. That controversial proposal, announced in early June, followed on the heels of EPA’s January proposal of regulations limiting greenhouse gas emissions from new power plants.

If adopted (and they will be), these proposed regulations will be the biggest diktats yet originating from Obama’s Climate Action Plan. Administration officials are already celebrating the salvation of mankind, even before the regulations are finalized.

The administration is holding “hearings” around the country so it can take your input to improve these already near-perfect rules. To help guide us, the White House just released a new report describing how the costs of climate change will skyrocket the longer we delay taking action to stop it.

According to EPA Administrator Gina McCarthy, the collection of administration actions on climate change is “changing the tone” in talks with foreign nations. No doubt encouraged by this “changing tone,” President Obama is scheduled to attend a UN climate “summit” in New York this September.

To what end? What benefit will “taking the lead” on climate change actually provide the United States?

It turns out to be very little. In fact, it will probably cost us.

The United States is not at great risk from climate change. The Obama administration’s Interagency Working Group tasked with establishing the social cost of carbon (SCC) determined that the SCC for the United States was only a few dollars per ton of carbon dioxide emitted—and that was calculated using overheated climate models. Taking into account new research that finds that the earth’s climate is less sensitive to greenhouse gas emissions, and the humongous body of literature demonstrating that enhanced carbon dioxide levels raise crop yields, the “social cost of carbon” in the United States becomes close to zero (or perhaps even negative, i.e., carbon emissions may actually provide a net benefit to the economy).

But that information is carefully concealed in Obama administration reports, such as the one that the Council of Economic Advisers (CEA) issued this week. Instead of focusing on the domestic cost of climate change—those affecting the United States—the reports discuss the global cost for carbon emissions (using a rather squirrely technique that is readily manipulated to provide any answer you want—so it’s ironic that EPA’s model to estimate temperature impacts is acronymed MAGICC).

It is a head scratcher as why U.S. policy to restrict carbon emissions (i.e., fossil fuel use)—which the administration’s own Federal Energy Regulatory Commission (FERC) says will result in higher energy costs to U.S. consumers—is justified by benefits that it says will largely accrue outside our borders.

The new CEA report clarifies:

Climate change is a global problem, and it will require strong international leadership to secure cooperation among both developed and developing countries to solve it. America must help forge a truly global solution to this global challenge by galvanizing international action to significantly reduce emissions.

Hence McCarthy’s enthusiasm.

If McCarthy is to be believed and administration actions have led to a change in the “tone” of communications, then it probably sounds a lot like lip service.

Two big reasons for this stand out:

The first is that, in the developed world, putting in mandatory emissions caps and carbon taxes are good ways to lose your next election.

Analyses show that Congress’s 2009 vote for cap-and-trade cost the Democrats control of the House of Representatives in the succeeding 2010 election. Less than two months after it passed, the Liberal Party in Australia voted out its leader, Malcolm Turnbull, for his support of a similar scheme. The next year, Australian Labour Party Prime Minister Kevin Rudd resigned his portfolio over the scheme. Then, exactly four years after our House passed cap-and trade, Rudd’s successor, Julia Gillard, was voted out over her carbon tax. (The Australian Parliament repealed the tax on July 17 of this year.)

The second reason is that current-generation renewable energy technologies are simply incapable of meeting the enormous energy needs of developing countries like China and India. If “climate change” ranks low among priorities in the United States, imagine how popular carbon reduction policies will be in countries with large populations with little to no access to electricity at all.

So, even if there is sincerity behind the changed “tone” in international discourse, any resulting agreements to mitigate climate will undoubtedly be unsuccessful, both politically and technologically.

That leaves us “leading” on an issue that science says is overblown, and one that the big, developing nations surely will not adopt (or, at least, achieve).

To this, we say “no thanks.”

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