A Stitch in Haste

Supreme Court Chips Away at McCain-Feingold

Kip — 2008-06-27T17:06+00:00

"Different candidates have different strengths. Some are wealthy; others have wealthy supporters who are willing to make large contributions. Some are celebrities; some have the benefit of a well-known family name. Leveling electoral opportunities means making and implementing judgments about which strengths should be permitted to contribute to the outcome of an election. The Constitution, however, confers upon voters, not Congress, the power to choose the Members of the House of Representatives, and it is a dangerous business for Congress to use the election laws to influence the voters' choices."
--Davis v. Federal Election Commission

They weren't only equal before God and the law. They were equal every which way. Nobody was smarter than anybody else. Nobody was better looking than anybody else. Nobody was stronger or quicker than anybody else. All this equality was due to the 211th, 212th, and 213th Amendments to the Constitution, and to the unceasing vigilance of agents of the United States Handicapper General.
--Kurt Vonnegut, "Harrison Bergeron" (1961)

To review: The Supreme Court, in its schizophrenic campaign finance decision Buckley v. Valeo, 424 U.S. 1 (1976), held that it is constitutionally protected speech to spend money to get yourself elected to public office, but not to get someone else elected to that same public office. So, for example, Michael Bloomberg was able to spend $70 million to run for re-election as mayor of New York, but I was barred by law from donating 0.1% of that to his opponent's campaign.

This created a pesky problem for incumbent politicians: rich people might actually spend money to run against them. Unacceptable. So they enacted, in a patently self-serving maneuver, an exemption from the Bipartisan Campaign Reform Act (BCRA), a/k/a "McCain-Feingold." This exemption, generally called the "Millionaire's Amendment," allowed candidates to exceed McCain-Feingold's limits if their opponents (who, recall from Buckley, can always spend as much of their own money as they want) spent beyond a certain amount.

(My understanding, incidentally, is that the Millionaire's Amendment was forced upon John McCain as a take-it-or-leave-it ultimatum in order to secure enough votes to pass BCRA in the first place.)

Fast-forward to yesterday. The Supreme Court quite rightly struck down the Millionaire's Amendment as a violation of the First Amendment:

We have never upheld the constitutionality of a law that imposes different contribution limits for candidates who are competing against each other, and we agree with Davis that this scheme impermissibly burdens his First Amendment right to spend his own money for campaign speech.
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While BCRA does not impose a cap on a candidate's expenditure of personal funds, it imposes an unprecedented penalty on any candidate who robustly exercises that First Amendment right. ... [A] candidate who wishes to exercise that right has two choices: abide by a limit on personal expenditures or endure the burden that is placed on that right by the activation of a scheme of discriminatory contribution limits.

In other words, there is no functional difference between forbidding you from spending your own money and "merely" penalizing you for it. Since the government cannot engage in the former, it ought not be able to engage in the latter. Hardly a controversial syllogism.

Meanwhile, since "campaign finance" jurisprudence is First Amendment jurisprudence, strict scrutiny applies: Is the restriction necessary to achieve a compelling government interest? Justice Alito holds no punches:

The burden imposed by §319(a) on the expenditure of personal funds is not justified by any governmental interest in eliminating corruption or the perception of corruption. The Buckley Court reasoned that reliance on personal funds reduces the threat of corruption, and therefore §319(a), by discouraging use of personal funds, disserves the anticorruption interest. [Bold added; underline in original.]

The Court also rejected "leveling the playing field" (i.e., restricting speech to equalize it) as a legitimate government interest. The Court saw the Millionaire's Amendment for what it was: Naked, brazen incumbent entrenchment.

There is a downside to the decision, however:

The advantage that wealthy candidates now enjoy and that §319(a) seeks to reduce is an advantage that flows directly from Buckley's disparate treatment of expenditures and contributions. If that approach is sound — and the Government does not urge us to hold otherwise — it is hard to see how undoing the consequences of that decision can be viewed as a compelling interest.

Translation: There appears to be no interest on the Court — or at least an insufficient number of votes — to revisit Buckley outright. That's unfortunate. (Justice Stevens, meanwhile, would resolve Buckley's schizophrenic holding by going in the "Harrison Bergeron" direction and allowing the government to restrict self-funded campaigns equally with contribution-funded campaigns — i.e., no First Amendment for anyone.)

(The Court also struck down a disclosure requirement associated with the Millionaire's Amendment on similar reasoning.)

The case is Davis v. Federal Election Commission, No. 07–320 (June 26, 2008) (PDF - 39 pages). The Millionaire's Amendment appears as an appendix in the decision. Note that Buckley v. Valeo is on my list of "Worst Supreme Court Cases."

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Every campaign finance case is opportunity for libertarians to "stand above it all" and sigh with disappointment (disgust?). All sides in the debate seem to agree on one thing: The whole point of the exercise is to combat corruption in politics. Fair enough, and noble enough.

But it is the libertarians, and only the libertarians, who ask the precedent question of why we have so much corruption in politics. The answer is simple: Because government does so much that invites corruption, that caters to corruption and that perpetuates corruption. Things that have nothing to do with the core functions of government — the functions that the Framers did, and most people today do, associate with a free society. Things that are explicitly designed to benefit, not everyone equally or equitably, but some at the expense of others. From earmarks to tax breaks, from nanny statism to nanny subsidies, from oil wells to oil wars.

If the politicians didn't do so much that they were never meant to do, then no one would try to buy them. That would be the best "campaign finance reform" of all.

Is "Chavez Insurance" A Legitimate Public Good?

Kip — 2008-06-20T11:06+00:00

Apparently the federal government thinks so:

The Overseas Private Investment Corporation (OPIC) was established in 1969 and began operations in 1971 to promote and assist U.S. business investment in developing nations. OPIC is a U.S. government agency that provides project financing, investment insurance, and other services for U.S. businesses in 154 developing nations and emerging economies.
...
OPIC political risk insurance is available to U.S. citizens, U.S. firms, or to the foreign subsidiaries of U.S. firms[.] This insurance covers three broad areas of political risk: currency inconvertibility, expropriation, and political violence.

Too bad OPIC's expropriation insurance only applies to "developing nations and emerging economies" and not the United States Congress.

Kidding aside, besides the pesky fact that, by definition, no insurance can ever be a public good (private party + private party = private contract; the word "public" is simply not part of the equation), there is already a robust, global, private insurance market for natural catastrophes (except where the government pre-empts it, such as with flood insurance). So why can't there be a similar private market for political catastrophes?

Perhaps the problem is that such a "political catastrophe" insurance market could never be profitable and therefore would never be introduced by the private sector?

Structured like a private corporation, OPIC operates on a self-sustaining basis and has recorded a positive net income for every year of operation, with reserves now totaling more than $3 billion.

The government is profiting from doing business with companies like Exxon? Go figure (literally).

The fact that OPIC can perform this function profitably (though it admittedly does so armed with vast, if thus far unused, borrowing capacity from the Treasury) shows precisely that it should not be a government agency in the first place. It is never, ever, a proper function of government to make a profit. Any service that can be provided profitably can be provided privately. Stated differently, you cannot have "market failure" without the "failure" part. And without market failure, there is no justification for public provision.

It's like the Amtrak Paradox -- its apologists insist that the unprofitable (i.e., unwanted) lines need taxpayer subsidies because private railroads wouldn't offer them, but simultaneously insist that the profitable lines should also receive subsidies precisely because they're so popular. Either-or, just so long as they get their billion, right?

The resolution of the paradox in the case of OPIC, meanwhile, is not hard to deduce:

Much of the rationale for OPIC relates to U.S. foreign policy goals, a premise that is being questioned by Members of Congress in a number of ways.

Obviously. OPIC is not about correcting a market failure but rather about pushing a policy agenda in spite of, not inspired by, market forces. Cf., "ethanol."

Keep in mind also that just because OPIC itself is profitable does not mean it does not have negative side effects:

Economists generally oppose the use of subsidized credits to promote trade or investment abroad. They believe such subsidies tend to distort the flow of capital and resources away from the most efficient uses. They also believe that by promoting investment abroad, OPIC may be crowding out, and thereby reducing, some domestic investment. As long as OPIC's non-federal collections -- or the fees it charges the public for its services -- are sufficient to cover all of its credit and non-credit activities (as indicated by some estimates), it may not have a negative impact on the federal government's budget. OPIC's impact on U.S. capital and resource markets, however, may well be negative due to the distortionary effects of subsidized credits.

But economists are all "elitists" anyway, so who cares what they think, right?

The Supreme Court and the Dueling Senators

Kip — 2008-06-14T15:06+00:00

If you didn't already know (and you probably do), would you be able to match the senator with the quote?

One recent quote:

It is one of the worst decisions in the history of this country. Our first obligation is the safety and security of this nation and the men and women who defend it. This decision will harm our ability to do that. ... I argue against it and will do what I can to at least narrow down some of the wide open aspects of this Supreme Court decision.

Another recent quote:

Congress has passed laws to protect Americans in these areas, but in case after case, the Supreme Court has ignored the intent of Congress in passing these measures, oftentimes turning these laws on their heads[.]

One quote was of course from Republican John McCain prattling about that pesky Suspension Clause; the other was from Democrat Pat Leahy prattling about that pesky Supremacy Clause.

And both were, of course, also prattling about those pesky "judicial activists" on the Supreme Court.

Consistent, Constitution-respecting, freedom-celebrating jurisprudence is non-partisan. Inconsistent, Constitution-trampling, freedom-infringing jurisprudence is bipartisan. Note the subtle, but all-important, distinction: "Non-partisan" is not the same as "bipartisan."

The only reality-based definition of "activist judge" is "a judge who disagrees with me." It's also the most mockworthy definition.

"I Know It When I See It" Quote of the Day

Kip — 2008-06-14T02:06+00:00

"There are two Lady Godivas, two women on horses with no shirt on and long hair."
--Republican delegate Robert Hurt of Texas

Or maybe not:

Actually, they are classical sculptures about war — one called Valor, depicting a male equestrian and a female with a shield, and Sacrifice, a female accompanying the rider Mars.

The statutes — on the Arlington Memorial Bridge in Washington — are apparently of great concern to Mr. Hurt:

Of all the evils in Washington that the Texas GOP took aim at this week, removing art with naked people from public view was high on the list for Mr. Hurt, a delegate from Kerrville.
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Mr. Hurt offered statistics: He'd heard that 20 percent of the art in the National Gallery of Art is of nudes.
...
Ridding Washington of naked art didn't make [the GOP platform].

Neither, apparently, did banning the Bible — which has far more sex (not to mention rape and incest) than the Arlington Memorial Bridge. Go figure.

So what did make it into the Republican platform?

In this, a presidential year, it advocates prayer in school[,] teaching intelligent design with evolution in science classes [and] calls homosexuality contrary to "the unchanging truths" ordained by God. It opposes gay marriage, civil unions and the custody of children by gays.

And John McCain will come riding in, like Valor atop his steed, to take up this proud conservative banner into political combat, right?

There's a call to repeal the McCain-Feingold campaign finance law, sponsored by the party's presidential nominee[.]

Ouch. Anyone know of any comparable divergence between the Democratic platform and Obama's record or stated agenda?

(Via Fark.)

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A blast from the past:

The Constitution "Cannot Be Contracted Away Like This"

Kip — 2008-06-12T20:06+00:00

As President, John McCain will take it as his most sacred responsibility to keep America free, safe, and strong -- an abiding beacon of freedom and hope to the world.
--McCain campaign website

The creation of crimes after the commission of the fact ... and the practice of arbitrary imprisonments, have been, in all ages, the favorite and most formidable instruments of tyranny.
--Federalist #84

I previously wrote:

To claim that Guantanamo, with all its military accoutrements -- its guns, cells, guns, barbed-wire fences, guns, guard dogs, guns, etc. -- is not "United States territory" is such a joke as to bring into doubt the competence of the judges concluding as much. It boggles the mind.

The Supreme Court ruled:

The United States has maintained complete and uninterrupted control of the bay for over 100 years. ... Yet the Government's view is that the Constitution had no effect there, at least as to noncitizens, because the United States disclaimed sovereignty in the formal sense of the term. The necessary implication of the argument is that by surrendering formal sovereignty over any unincorporated territory to a third party, while at the same time entering into a lease that grants total control over the territory back to the United States, it would be possible for the political branches to govern without legal constraint. Our basic charter cannot be contracted away like this.

In a famous case, the Supreme Court once declared that the Fourth Amendment "protects people, not places." Today the Court made the uncontroversial observation that, at least to some extent, so too does the Suspension Clause. May all the Constitution one day be given likewise deference.

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I previously wrote:

If you are a textualist (like me), then the [MCA's] revocation of habeas corpus is patently unconstitutional[.] No amount of sophistry can change the fact that we do not currently face "rebellion or invasion." Even 9/11 was not an "invasion." The Wars in Iraq and Afghanistan are not "invasions." This is not a difficult concept.

The Court ruled:

Historically, Congress has taken care to avoid suspensions of the writ. ... In contrast, Congress intended the DTA and the MCA to circumscribe habeas review, as is evident from the unequivocal nature of MCA §7's jurisdiction-stripping language, from the DTA's text limiting the Court of Appeals' jurisdiction to assessing whether the CSRT complied with the "standards and procedures specified by the Secretary of Defense," ... and from the absence of a saving clause in either Act.

Congress tried to pretend that it didn't really suspend habeas corpus when it passed the Military Commissions Act and the Detainee Treatment Act. Today the Court made the uncontroversial observation that of course Congress suspended habeas corpus when it passed the MCA -- thanks in large part to John McCain, who conned the Senate, and the American people, into thinking that he was somehow defending the Geneva Conventions when in fact he was gleefully capitulating to the Bush Administration and embracing the law's most draconian provisions:

It immunizes government officials for past war crimes; it cuts the United States off from its obligations under the Geneva Conventions; and it all but eliminates access to civilian courts for non-citizens -- including permanent residents whose children are citizens -- that the government, in its nearly unreviewable discretion, determines to be unlawful enemy combatants.

That last part was the topic of today's monumental ruling.

And, in case you forgot, John McCain sponsored the Detainee Treatment Act himself, complete with its unconstitutional suspension of habeas corpus.

It will be interesting to see how the "straight-talking maverick" tries to spin the Court's decision, which is as much a repudiation of his dangerous theory of constitutional war powers as of President Bush's.

The case is Boumediene v. Bush, No. 06-1195 (June 12, 2008) (PDF - 134 pages). Timeline of the Guantanamo cases here.

Linkfest: "Children, Students and the First Amendment"

Kip — 2008-06-11T15:06+00:00

Quick dispatches from here and there —

ITEM: The federal government continues its futile, warm-fuzzy-feeling efforts to censor the Internet in the name of "protecting children." The Child Online Protection Act, enjoined by the Supreme Court in Ashcroft v. ACLU, 542 U.S. 656 (2004) (a/k/a "Reno II" — and yes that's "Reno" as in "Janet" from way back in 1998) is again before the Third Circuit, where the Justice Department must convince the court that:

the availability to parents of built-in content filters

the fact that U.S. law cannot reach online porn posted overseas anyway

the fact that COPA "does not cover chat rooms, You Tube and other interactive sites that emerged in the last decade"

are all somehow irrelevant and that age verification ("a belt and suspenders approach" according to the DOJ lawyer arguing the case) is the "least intrusive way" to achieve the law's stated goals. Expect the court to yet again find the law unconstitutional. Flagship post here.

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ITEM: Here's an incident where the censors claim not to be protecting the children but rather the parents —

In the short walk across stage, Joseph Bryan Shore, 18, elicited more than boos when he allegedly cursed out his family and flipped the bird to the crowd, according to authorities. Immediately after the [high school graduation] ceremony, two police officers took him into custody and charged him with disorderly conduct.
...
The principal of Arab City High School, Patrick Crowder, said he regretted the incident but that he had no choice other than to have Shore arrested.

MY TAKE: The principal "had no choice"? Over a few moments of some profanities and the finger — both of which are unambiguously protected free speech, even in "dignified" (the principal's term) settings such as, e.g., a courthouse? Without more, this sounds not only like a improper arrest but also a civil rights violation that would survive a qualified immunity challenge. (Related late entry here — it is graduation season, after all.)

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ITEM: Let's switch from "commencement and freedom of speech" to "commencement and freedom of religion" —

Newark Public Schools has settled a lawsuit filed by a former student who claimed he couldn't attend his graduation from West Side High School because it was held in the sanctuary of a local Baptist Church.

Bilal Shareef, a Muslim student, said his religious faith prohibited him from entering a building with religious icons, such as pictures of God or images of the cross. He skipped the ceremony held at New Hope Baptist Church in June 2006.
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The district also agreed not to sponsor or promote religious events, not to hold student events in places of worship and not to hold student events in other religious buildings unless religious images are covered.

MY TAKE: It is beyond absurd to suggest that a public school district as large as Newark's cannot find suitable secular locations to hold high school graduations and therefore simply "must" have them in churches. If all else fails, then have them at the schools themselves — that's where mine was held. I don't buy the "no other suitable site" excuse for using churches as polling places, and I don't buy it here. (Via Religion Clause.)

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ITEM: And will students be reading about such stories in the school newspaper?

A high school newspaper in Northern California has been disbanded after it published a front-page photo of a student burning an American flag, triggering criticism that the administration was stifling free expression.
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The Redding controversy is the latest example in recent years of high school and college administrators in California attempting to censure [sic] student-run newspapers or punish those who oversee them.

MY TAKE: I always tread lightly on this topic, since I am not convinced that there is a "right to a (taxpayer-funded) school newspaper." And no student was disciplined or penalized for exercising her free speech rights (cf., the Doninger case I recently updated here). But the fact that the topic that resulted in the newspaper's termination — flag burning — is itself protected expression and generates so much faux indignation by activist legislators and other anti-rights malcontents certainly gets my libertarian dander up.

Another Econ. 101 Moment

Kip — 2008-06-10T18:06+00:00

The problem with real-world economics is that reality is simply too complex and too dynamic to fit into nice little freshman-classroom, single-chalkboard equations. Everything impacts everything else, everything generates unintended consequences, cause and effect become lost in the haze of secondary and tertiary factors.

Or not:

According to BLS data on unemployment rates by age, it looks like almost all of the .50% increase in May unemployment to 5.5% from 5% in April was due to increases in the jobless rates for young workers in the 16-24 year age group, especially the 16-19 year group. For workers 25 years and over, the jobless rate has remained pretty stable at around 4%[.]
...
Although it apparently hasn't received much media attention, perhaps there is a link between the rising unemployment rate for teenagers and the pending 12% increase in the minimum wage next month. Since we have evidence that consumers respond to higher gas prices by driving less, wouldn't it also be the case that employers of unskilled workers would respond to 12% increases in wages for unskilled workers by hiring fewer unskilled workers?

The laws of economics are not subject to repeal by any legislature, any more than are the laws of physics. In the aggregate and over a sufficiently long time horizon, an employer is simply not going to pay a worker more than she is worth to him. If the government makes it impossible for that employer to pay what that employee is worth (e.g., because of minimum wage laws or mandatory benefits), then the employer will simply not hire the employee. Government-imposed price floors create surpluses. All else is willful obliviousness.

(Larger version here.)
It's quite simple really: Anyone who loves the minimum wage hates young unskilled workers, and has no claim whatsoever — whether in the name of "progressivism" or "enlightened public policy" or "maximizing social welfare" or any other insolent bromide — to the moral high ground.

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The disingenuous liberal response to this development, nicely illustrated here, is that the rise is teenage unemployment is explained more, if not entirely, by "general economic conditions" (i.e., recession) and not by the recent increase in the minimum wage (or the chilling effect of the next increase on July 24 or the next one in 2009). But, since we are not in recession, that simply cannot be right. Go figure. (How also does one explain via "the business cycle" the fact that all the increase in unemployment is with young — i.e., unskilled — workers?)

And even if we were in recession — so what? That only makes matters worse. The fact remains that creating an artificial hurdle of productivity increases the likelihood of losing your job because you can no longer meet that hurdle. Even more so in a weak economy!

To be paid the minimum wage, you must first earn the minimum wage. If you don't, then your employer must either let you go or go bankrupt himself. A weak economy makes earning that minimum wage, let alone a drastically higher one, all the more difficult.

For example: A restaurant that, due to recession (or rising gas prices or whatever) sees business decline is far more likely to let a server or busboy go the higher the minimum wage is, all else equal. Not all the servers and busboys, to be sure — but maybe one or two. Now aggregate that "maybe one or two" over the entire young-and-unskilled service economy. And don't forget multiplier effects.

The road to hell is paved with economic illiteracy (and partisan politics) masquerading as "good intentions."

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Via Market Power. More thoughts at Hit & Run.

Where Does One Draw the "Liberal-tarian" Line?

Kip — 2008-06-09T19:06+00:00

I don't think it's supposed to be here:

Democratic presidential candidate Barack Obama sought to tap into Americans' anxiety over high gasoline prices on Monday by saying he would impose a windfall profits tax on U.S. oil companies if elected.
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"I'll make oil companies like Exxon pay a tax on their windfall profits, and we'll use the money to help families pay for their skyrocketing energy costs and other bills," the Illinois senator said.

I was sure that a post-Clinton Obama would immediately move to the center and refrain from blathering hopeless gobbledygook like this. I hope this one issue is an isolated exception and not a sign of things to come.

I especially chuckled at this -- apparently from the same speech:

Obama said he would seek a reform of the U.S. tax code if elected in November, saying the current tax system is a "10,000-page monstrosity."

But of course reform can only come after Obama first adds his "liberaltarian" 10,001st page on behalf of the ignoranti who irrationally loathe Exxon -- and, vicariously, themselves.

"Tragedy of the Commons" Agenda Item of the Day

Kip — 2008-06-07T21:06+00:00

Item Number Two on the Agenda:

Discussion of the overcrowding at John Jay Pool during the summer months.

John Jay Pool is of course located in John Jay Park, a massive* WPA-era project that is city-owned, taxpayer-funded — and admission-free.

And it's overcrowded? Who could possibly have seen that coming?

(*Not so massive that they are able find any space among the playgrounds, swimming pool, tennis and basketball courts and handball walls for even a modest dog run. Go figure.)

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For those who simply must know — Item Number One on the Agenda:

Discussion of the proposed variance for Mt. Sinai Hospital's planned tower at 102nd Street between Fifth and Madison Avenues. Concern centers on the degree of shadowing this tower would cause in Central Park[.]

Yet another ~~not-for-profit~~ cold, cruel, soulless hospital oppressing the community with their ~~healthcare-providing~~ frivolous, predatory, pharmaceutical-industrial-complex, might-throw-a-shadow tower? Have they no shame! How lucky we are indeed to have unelected "Community Boards" to protect us from these out-of-control leviathans!

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The flier announcing the Community Board meeting has, in bold-italic, all-cap font:

OFFICIAL GOVERNMENT NOTICE
It also has this:

Good for government work, I guess.

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It also has this on the back:

Recycled Paper — For a Healthy & Sustainable Environment
Recycled — oh joy. On the other hand, these fliers adorned every — every — lamppost, traffic signal, utility box and pay phone in my neighborhood. Any one street block would have as many as five of these posted. How environmentally friendly is that? (And did I mention the masking tape — was that recycled too?)

How is This a "National" Crisis?

Kip — 2008-06-06T10:06+00:00

The latest data on the mortgage and housing situation:

Nearly 1 in 10 American homeowners with a mortgage faced foreclosure or fell behind in their payments in the first three months of the year, according to a report released Thursday, a figure that offers a look into the toll caused by the collapse of the housing market.

Of course, this means that the Times' headline — "Nearly 1 in 10 American Homeowners Face Problems With Loans" — is flat-out wrong: Do we really need a remedial course in the difference between "homeowners" and "homeowners with a mortgage"?

Similarly, do we really need a remedial course in arithmetic? If 10% of homeowners with a mortgage "face a problem with their mortgage," then by definition 90% do not.

And of course, not every mortgage "problem" (i.e., foreclosure, late payments or missed payments) maps to a unique homeowner problem: speculators — sometimes with 5, 10 or 15 properties — surely explain some if not many of these occurrences (the report, by the Mortgage Bankers Association, is based on all residential mortgages, including by speculators financing multiple properties). By the same token, many of these loans represent just-completed or even unfinished properties in new housing developments (i.e., no one has ever lived in them and no one is being forced out of them).

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Which leads to the other rarely-discussed fact about the "crisis" —

Four states — Arizona, California, Florida and Nevada — accounted for about 89 percent of the foreclosures, a disproportionately high amount of the newly reported figures.

I have seen first-hand the situation in the Las Vegas suburbs, where my parents now reside in a new-build community (with no mortgage, incidentally).

The mindset has been, and continues to be, "build first, sell later." Of course there is a housing collapse there: Why would anyone buy a "used" house when they're still building brand new ones on the other side of the development for basically the same price?

(And, to make matters worse, why buy a foreclosed property that you are prohibited, by law, from entering and inspecting? It's bizarre: you literally have to bid on the property sight unseen. But that's how it works in Nevada, or at least where my parents live.)

At least four houses on my parents' street have foreclosure notices taped to the garage door. Not a single one was ever occupied (at least not by owners — some were briefly rented). No Mother Peep, no Silas Barnaby, no evil conspiracies, certainly no "predatory" lending. Just gamblers who lost — a phenomenon not unusual in Nevada.

Speaking of my parents: What do Nevada, Florida and Arizona have in common? That's right: They are retirement destinations; my parents are a prime (no pun intended) example. Who really believes that legions of middle-class (or wealthier) retirees are selling their homes and setting up shop in a new state — armed with their sold-house proceeds, their pensions, their IRAs and their Social Security checks — and then blowing it all on a subprime mortgage? Of course that's not what's happening. The people who had the common sense and the modesty to simply buy one house and live in it are not the ones caught up in all this.

So I ask again: How do 5% of mortgage-encumbered owner-residents (again, not mere "homeowners"), mostly speculators, in four states constitute a "national" crisis?

Where "Get Out of the Marriage Business" is Correct

Kip — 2008-06-06T01:06+00:00

To review: One of the most embarrassing forest-trees error that libertarians can make is to argue that, since "government should get out of the marriage business" (a dubious proposition in and of itself), then it must follow that libertarians should oppose gay marriage, because at least that way somebody isn't getting married, which (the argument goes) advances the (allegedly) libertarian end-goal of abolishing marriage as a legal status altogether.

It's a mind-bogglingly stupid (not to mention cruel) argument — one that not only ignores reality but also ignores theory: Since when is equal protection (writ large, very large) acceptable collateral damage in the libertarian war on governmental meddling (writ small, very small)?

On the other hand, and for the sake of perspective, here's an instance where I think all libertarians can indeed agree: Government should definitely get out of this part of the marriage business —

The [Kern County, California] office will issue same-sex marriage licenses beginning June 17 as state law requires but will stop solemnizing weddings due to lack of staff and space, Auditor-Controller-County Clerk Ann Barnett announced in a news release Wednesday evening.
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Julie Poochigian, chief deputy clerk-recorder of Tulare County, said her office plans to issue marriage licenses to same-sex couples starting June 17. She said the office has never performed wedding ceremonies for couples.

"Some other counties do that, but Tulare County does not," she said. "We are not staffed to perform the services."

I simply do not see how it is a proper function of government to provide a wedding ceremony, any more than it would be a proper function of government to provide a wedding gown or a tuxedo. The only requirement is fair and equal treatment in the issuance and recognition of marriage licenses.

By contrast, recall that this is utterly unacceptable:

San Diego County plans to comply with a state Supreme Court ruling that allows same-sex marriages but will not force employees to perform the ceremonies if they cite religious or moral objections.

County Assessor-Recorder-Clerk Greg Smith, whose office issues marriage licenses, said he has informed the roughly 115 employees deputized to conduct ceremonies to tell him if they object to same-sex marriages.

It's quite simple really: If your taxpayer-funded job requires you to treat all comers fairly and equally, but your ~~bigotry~~ religion prevents you from doing so, then quit. That's the only "reasonable accommodation" you're entitled to. (Compare to my previous posts on when private pharmacists object to dispensing contraception.)

(Via Good As You, who is a bit more cynical about the county clerk's motivations.)

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Speaking of Kern County and gay marriage: Be sure not to drink the carrot juice.

Does the Constitution Count as a "Legitimate Reason"?

Kip — 2008-06-05T19:06+00:00

(Please see update below.)

By now you have likely seen the utterly outrageous reports that the District of Columbia, most recently known for holding the Second Amendment in absolute contempt, has now upgraded — or downgraded, depending on your nomenclature — to likewise trampling other parts of the Bill of Rights:

D.C. police will seal off entire neighborhoods, set up checkpoints and kick out strangers under a new program that D.C. officials hope will help them rescue the city from its out-of-control violence.

Under an executive order expected to be announced today, police Chief Cathy L. Lanier will have the authority to designate "Neighborhood Safety Zones." At least six officers will man cordons around those zones and demand identification from people coming in and out of them. Anyone who doesn't live there, work there or have "legitimate reason" to be there will be sent away or face arrest, documents obtained by The Examiner show.

Some hasty stitches:

--The right* of otherwise law-abiding citizens to be in and move through public spaces, with or without identification and with or without a "legitimate reason," is well-settled law. See Papachristou v. Jacksonville, 405 U.S. 156 (1972), Brown v. Texas, 443 U. S. 47 (1979), and especially Hiibel v. Nevada 542 U.S. 177 (2004), (Breyer, J., dissenting). (*I would be just as happy to use the term "privilege and immunity," but that doesn't get you very far, no pun intended.)

--The requirement that one's purpose be "legitimate" is of course unconstitutionally vague. "Legitimate" — to whom? By what standard? Is walking one's dog a "legitimate reason"? Proselytizing on behalf of the Mormon faith? Collecting bottles for the nickel deposits? Taking your kids to a blighted area to "see how the other half lives"?

--Suppose I show up at such a checkpoint and simply declare: My "legitimate reason" is my desire to exercise my First Amendment right not to need a legitimate reason. Do I win because I have a legitimate reason or because I don't need one?

--Speaking of unconstitutional vagueness, what will the criteria be for determining which neighborhoods deserve this Checkpoint Charlie nightmare? Will the designations be subject to race-based or other discrimination challenges, much like our statutory and judicial approach to fighting gerrymandering or busing?

--Going back to the Second Amendment and the pending decision in District v. Heller: Most libertarians wasted little time in debunking the hopelessly silly "Congress has plenary Article I authority over the District" canard by asking whether Congress could, hypothetically, repeal the First Amendment within the borders of the District. Who knew that the District would actually consider trying it? See also the (just as hopelessly silly) claim that the federal government can authorize, without constitutional amendment, full voting representation for the District in Congress.

(Via Hit & Run.)

---

UPDATE: Subsequent media accounts now clarify that the checkpoints will be vehicular, not pedestrian. That changes neither the outrageousness nor the unconstitutionality of the program — only the precedents with which to analyze the proposal. Indianapolis v. Edmond, 531 U.S. 32 (2000) is both clear and directly on point: Vehicle checkpoints, without individualized suspicion and established merely for "general crime control purposes," violate the Fourth Amendment. Accord, U.S. v. Lidster, 540 U.S. 419 (2004). My void-for-vagueness analysis is also still entirely applicable here, as would be any requirement that passengers in the vehicle produce ID (the driver would of course be required to produce a valid drivers license).

More on Cap-and-Trade versus Pigou Taxation

Kip — 2008-06-05T00:06+00:00

For those who may have had some trouble following the (very minor) debate between Doc Palmer and me in the comments to my previous post on cap-and-trade, Arnold Kling explains, in the context of another debate between Robert Samuelson (who takes my side) and Ryan Avent (who insists that there is an equivalence between cap-and-trade and Pigou taxation):

Samuelson is correct here and Avent is misleading. When there is uncertainty about the location of the social optimum, and uncertainty about elasticities, a carbon tax and cap-and-trade are by no means equivalent. If you see very high costs from setting the binding cap too low and choking off growth — as Samuelson mentions — you should prefer the carbon tax. The price of carbon is more certain and you bear less risk from uncertainty about how fast solar power and other technologies will develop. Alternatively, you might say that risk is transformed into price risk rather than "you can't exceed this cap no matter what" risk.

Of course the postulated uncertainties are realistic in this context and you don't have to invoke uncertainty about the science of global warming.

Exactly right. If — and only if — you know with certainty what supply curves and (especially) demand curves look like now and will look like in the future, then yes you can certainly craft a cap-and-trade equivalent to Pigou taxation that will get you where you want to go. I can do it on the back of a napkin.

But of course that "and only if" part renders the thought experiment utterly academic. If calculating with any accuracy the "correct" Pigou tax is itself difficult or impossible, then how can calculating the "correct" cap-and-trade equivalent to that Pigou tax be any easier?

Two other hasty stitches.

--There is a fundamental normative (or, if you prefer, "moral") basis for (hypothetical) Pigou taxation that cap-and-trade cannot lay claim to, even if it somehow successfully replicates the outcome of the Pigou tax. Pigou taxation attempts to correct externalities, to make private costs reflect actual costs, to align actions with consequences. Cap-and-trade merely attempts to implement, by force, the majoritarian policy whim of the moment. The two are simply not moral equivalents; if they happen to work out to be economic equivalents in a given instance, then that is strictly coincidental.

--Speaking of "majoritarian policy whim of the moment," when I said above, "where you want to go," whom exactly do we mean by "you"?

Here are some of the features of the bill: Allocation to farmers and foresters[;] Transition assistance to workers[;] Transition assistance to ... refiners of petroleum [sic!] and natural gas providers; Federal assistance to low-income consumers[;] ... Assisting state economies that rely heavily on manufacturing and coal[;] Assisting state and local partnerships for mass transit[;] ... Allocation to owners of high efficiency buildings[;] Allocation to US producers of cellulosic biofuels; Special auction with proceeds directed to federal Firefighting[;] Special allocation to foreign countries [sic!][.]

Calling some of these carve-outs "transition" assistance is pretty funny, since they extend out to 2030 for the oil, natural gas, power generating and manufacturing companies (six presidential elections and more than three senate terms from now). Do you think that when 2030 rolls around their reaction is going to be "a deal's a deal"?

Of course, this is the rent-seeking we have now as the regulatory process is about to be kicked off. For this program to work, it has to remain in force for many decades. If this happens, entire lobbying firms will be built up to seek exemptions, allowances and so on. ... It will create another income tax code.

(Via Will Wilkinson, who has a follow-up post here.)

And those were just the earmarks and exemptions ("allocations") that got through markup. Many others were not included — yet.

Stated differently: For those on Directive 10-289 Watch —

(Source.)
Did you really think there wouldn't be a "Board" ("that will be authorized to trigger relief remedies in order to forestall any sustained adverse impact on the US economy") buried somewhere in this central-planner monstrosity?

Embracing the delusion that government, especially the federal government, can undertake sweeping new control of people and property fairly and objectively, let alone efficiently, is the great unabsolvable sin of political analysis.

Of course, Pigou taxation could fall victim to the same rent-seeking malfeasance. Point conceded. But the more you mistrust government, the more you should advocate "keeping it simple." Complexity breeds abuse. Yet one more reason to prefer the far less complicated Pigou tax framework to cap-and-lobby — er, cap-and-trade.

More thoughts from EconLog.

Linkfest: Moral Defective Watch

Kip — 2008-06-04T17:06+00:00

They wants the precious...

ITEM: After quietly running for president while insisting that he wasn't running for president, and after insisting that he had no intention of doing anything other than being a full-time philanthropist after his second term as New York City mayor ends, Michael Bloomberg has suddenly decided -- surprise! -- that, gosh darn it, he's just too important not to continue micromanaging every nook and cranny of the city and every decision the people in it make --

Mr. Bloomberg, as part of that effort, commissioned a poll recently to determine whether city voters would be open to lifting the term limits law, which forces him and other elected city officials from office after two four-year terms. The poll found that even as voters approved of his performance as mayor, they would strongly oppose any attempt to undo the limits.
...
The deliberations are occurring as the mayor expresses frustration that his agenda is unfinished and that some of his more ambitious proposals, like congestion pricing, have been blocked by lawmakers in Albany. And despite his previous public statements that he is looking forward to focusing on philanthropy full time after leaving office, people who have spoken to Mr. Bloomberg say he has clearly been bitten by the political bug and is not eager to give up the power that comes with elected office.

A hubris-drenched politician becoming hopelessly, disturbingly addicted to power? Who could possibly have seen that coming?

ITEM: Across the Hudson, very very very incumbent New Jersey senator Frank Lautenberg easily survived a primary challenge from fellow Democrat, Representative Rob Andrews. The central issue in the primary was not so much Lautenberg's age -- 84 -- but rather his hypocrisy for having used age -- 26 years ago -- against his first opponent, Millicent Fenwick (aged 72 at the time). Incidentally, the 84-year old Lautenberg is only the third oldest Senator, behind Robert Byrd (90) and Ted Stevens (84). The median age is 70; McCain is 71, Clinton is 60, Barack Obama (third youngest) is 46.

ITEM: Speaking of Hillary Clinton ... well, "Hillary Clinton." Enough said.

"Comment Left Elsewhere" of the Day

Kip — 2008-06-03T10:06+00:00

I really have no desire to be a Bible scholar, so I wish theocrats would stop making me have to look this stuff up:

The Jewish tradition in which Jesus lived and taught demanded that just rulers make a minimal provision for the poor, including no-interest loans and the distribution of agricultural commodities. (Look it up: Exodus 22:25-27 and Deuteronomy 24:19-21.) The apostle Paul held a high view of government's role in promoting justice and urged the willing payment of taxes — a biblical demand more severe, for some of us, than all those sexual prohibitions.

As I noted in a few comments on this, most recently here:

At least some, if not most, translations of Exodus 22:25 say "excessive interest" or "usury" and not just "interest."

The passage could also easily be interpreted as a call for discrimination: Do not charge one of my people (i.e., another Hebrew) excessive interest. Open season on exploiting goyim, however. (See also Deuteronomy 23:20.)

And the passage says nothing about government-mandated law — just being a good neighbor (and, of course, avoiding God's wrath).

Wrath which, as well all know, is limitless — at least in the Old Testament.

It's quite simple really: The Bible is large enough, covers a sufficiently long time frame and has so many different (earthly) authors that anyone, from a Randian to a Leninist, from a Catholic to a Mormon to an atheist, can find a stray verse or two to support their secular viewpoint and agenda. See also, "whales."

If you try to claim Moses or Jesus (or, for that matter, God) as one of your loyal constituents, then you'll have to do better than one lone backwater verse. Just ask the shrimp.

On the Cap-and-Trade "Market" Fallacy

Kip — 2008-06-03T00:06+00:00

George Will skewers the insolent notion that cap-and-trade proposals to reduce carbon emissions, such as those currently before Congress and endorsed by all three presidential candidates, are somehow "market-based" —

"[C]ap-and-trade" comes cloaked in reassuring rhetoric about the government merely creating a market, but government actually would create a scarcity so that government could sell what it had made scarce. The Wall Street Journal underestimates cap-and-trade's perniciousness when it says the scheme would create a new right ("allowances") to produce carbon dioxide and would put a price on the right. Actually, because freedom is the silence of the law, that right has always existed in the absence of prohibitions. With cap-and-trade, government would create a right for itself — an extraordinarily lucrative right to ration Americans' exercise of their traditional rights. (Emphasis in original.)

This observation is all-important: Going from the unfettered ability — even if taxed — to engage in productive activity to the very-fettered ability to engage in that same productive activity is hardly "creating a new right." It is command-and-control socialism, pure and simple.

And it's a phenomenon we've seen before, in that other great quest for "enlightened" (i.e., socialist) command-and-control policy: health care. Reading Will's description of cap-and-trade reminded me of something I wrote a while back:

The nanny-state central planners decide to provide public health care benefits, of whatever flavor, which are by definition paid for with public money (i.e., taxpayer money). They then turn around and tell those very same taxpayers that, since it's "the public's" money and not theirs, the government can therefore impose controls on the public's behavior to compensate for the resulting mismatch — that the government itself created! — between the "public" that pays for the benefits and the "public" that receives them.

I was responding in that excerpt to Paul Krugman's socialized-medicine defense of the War on Obesity. Is it any surprise that Krugman also supports cap-and-trade? Or that he repeats the lie that cap-and-trade is somehow "market-friendly"?

---

Robert Samuelson, meanwhile, piles on:

Reviewing five economic models, the Environmental Defense Fund asserts that the cuts can be achieved "without significant adverse consequences to the economy." Fuel prices would rise, but because people would use less energy, the impact on household budgets would be modest.

Of course, using less energy might have a modest effect on a household's budget, but it does not necessarily mean a modest effect on that household's quality of life.

An extreme (but entirely legitimate) example: One of the most effective ways to reduce your energy bill is to turn off your air conditioner during a heat wave. It's also one of the most effective ways to die. Or are we also going to implement "cap-and-trade" allotments on the ability to live in Las Vegas or Phoenix (or, for that matter, Minneapolis or Buffalo)?

There is, literally, more to life than "household budgets."

It's quite simple really: Consumption, by itself, is not a negative externality. There is nothing whatsoever immoral about purchasing as much of anything — energy, food, real estate, Picassos, anything — as your budget allows and your subjective tastes and preferences encourage. As long as you pay for it with your own money in a free market.

Where true negative externalities (such as pollution) can be objectively demonstrated and reasonably measured (or at least reasonably estimated), then Pigou taxes — with no limits on output — are the proper approach, both economically and morally.

Cap-and-trade fails both tests, quite miserably (i.e., we'll all be miserable if we adopt it).

---

The bill before Congress, generally referred to as "Lieberman-Warner," is officially titled — get this — America's Climate Security Act of 2007, S.2191.

Obligatory Barr-DOMA Post

Kip — 2008-05-29T00:05+00:00

Here is what he said:

But many of you have also come up to me and said, "Barr, why did you offer the Defense of Marriage Act? If you're so set against the Patriot Act, why did you vote for it?"

Well, let me tell you. I have made mistakes. But the only way you make mistakes, the only way you get things done is by getting out there in the arena and making those mistakes, and then realizing as things go on the mistakes that you've made.

And I apologize for that. For example, as I mentioned to you all last night with the Defense of Marriage Act. As I mentioned to you all last night and I reiterate it here today, standing before you and looking you in the eye: the Defense of Marriage Act — insofar as it provided the federal government a club to club down the rights of law-abiding American citizens — has been abused, misused and should be repealed. And I will work to repeal that.

Here is what I say:

Barr's mea culpa rings quite hollow.

Making a mistake is better than doing nothing in the first place? In the context of issues such as DOMA and the Patriot Act? Is he serious?

And to make matters worse, he says this to a crowd of self-appointed libertarian standard-bearer purists and gets — applause?

I recently called the Big-L Libertarian Party a "freak show" — and I stand by that description.

---

Barr also said in that clip that DOMA is being "abused and misused."

Um, "abused and misused" — how?

I know of no instance — none whatsoever — where DOMA has been "abused and misused." It has been, and will continue to be, used exactly the way Barr originally intended: to discriminate against gays and to legitimize anti-gay bigotry.

Please do not mistake this microphone-addicted conservative has-been for a "libertarian."

More thoughts at Republic of T., Box Turtle Bulletin, Outright Libertarians.

Kip's Law Sighting: "That Would Be Silly"

Kip — 2008-05-08T14:05+00:00

"A building has integrity, just like a man — and just as seldom."
--The Fountainhead

Goldilocks and the triplicate permit forms:

John Jessop earned a cult following among his colleagues after his withering comments were leaked in an e-mail which has been sent all round the country.

After being asked to fill in a "design access statement" for a storage shed on a small farm, he wrote: "The density is like on a farm, the social context is a farm in the country, the economic context is farming in the United Kingdom in 2008 (which is not very economic), the opportunities are to store equipment inside rather than the outside, the constraint is the planning system."

And under a section headed Context Analysis, he said: "The use is compatible with a farm because it is a farm building."

"It is located where it is because it is in the most convenient place, being on the farm and near the farmhouse."
...
"It can not be lower because nothing could be stored in it. It is not made any higher because that would be silly."

But since when did being "silly" stop a planning bureaucrat?

The notion that a farmer needs anybody's permission to build a farming shed on his farming land to store his farming equipment that he uses to earn his farming income shows how far the half-sibling notions of "zoning" and "environmental impact statements" have corrupted what used to be a rationally based concern for negative externalities. In the past, such reviews were cursory, common sense inquiries. Today? Yes, we the central planners have graciously allowed you to call your land a "farm," but that obviously did not mean that we would also allow you to "do farming" on it. We'll get back to you on that after we review your design access statement...

Other gems omitted from the media account:

--"Landscaping: The applicant and pervious [sic] occupants have spent a long time, probably more than a thousand years, making the countryside around the house look like farmland so that everyone can enjoy the pretty English countryside."

--"Access: There is an airport at Bristol which can be accessed by driving your tractor along the road. This gives direct access to warm sunny places all over the world."

--"Appearance: It looks like a typical modern agricultural shed in green profiled metal sheeting because that is what it is, and a great architect once said, 'Buildings should look like what they are'."

Methinks Mr. Jessop has read The Fountainhead.

Kip's Law: Every advocate of central planning always — always — envisions himself as the central planner.

Original 3-page document PDF here. (Via Fark.)

Directive 10-289 Watch

Kip — 2008-05-06T11:05+00:00

(I sincerely hope this does not become a regular feature here.)

One of the first industries the looters went after in Atlas Shrugged was, of course, oil.

And who is better at looting than politicians?

U.S. Rep. Paul Kanjorski said it's time for America to stand up to the big oil companies and shout out, "We've had enough."

Kanjorski, D-Nanticoke, was in town Monday to announce his introduction of House Resolution 5800, the Consumer Reasonable Energy Price Protection Act of 2008. The bill, introduced on the House floor April 15, would allow the federal government to tax windfall oil and gas profits resulting from historically high oil and gas prices that average Americans struggle to afford, he said.

Kanjorski said industries yield windfall profits when earnings exceed what a Reasonable Profits Board determines is rational, as laid out in the legislation.

Rational profits? As determined by a Reasonable Profits Board? Would Hugo Chavez or Robert Mugabe be eligible to serve on it? (If not, then perhaps Ms. Maureen Felix of West Orange, New Jersey, is available.)

The futility of pointing out, "reasonable to whom, by what standard" is not lost on me. The impermeability of the blood-brain barrier between politicians and reasonableness is common knowledge.

Also not lost on me is the futility of pointing out, yet again, that "big" oil companies actually consist of numerous small shareholders, either directly as individuals and households (such as those that the "reasonable" Representative Kanjorski putatively serves), or indirectly — as employees (whose pension funds own oil company stock), small business owners (who retirement accounts include index funds that include such stock), students (whose college endowment funds own such stock) or anyone else who indirectly benefits from "obscene" oil company profits.

Equally futile would, I suppose, be asking where one goes to apply for a seat on the Reasonable Taxation Board:

(Click to enlarge.)

Via Tax Policy Blog.

(For the uninitiated, Directive 10-289 here.)

If This Be Elitism, Make the Most of It...

Kip — 2008-05-06T01:05+00:00

There are certain axioms, certain fundamental pillars, upon which this blog is based. One is that all politicians are, by definition, moral defectives. Another is the ubiquitousness of the Politics of the Warm Fuzzy Feeling. Another is Kip's Law.

Yet another — one you have seen repeatedly here — is that the laws of economics are no more subject to repeal by a legislature than are the laws of physics.

Perhaps it's time to add a flying buttress to that last pillar: No truth, including economic truth, can ever be "elitist" —

Democratic presidential candidate Hillary Clinton on Sunday dismissed the "elite opinion" of economists who criticized her gas tax proposal, using a term that has dogged rival Barack Obama in recent weeks.
...
"I'm not going to put my lot in with economists," Clinton said when asked to name an economist who backed her proposal.

"We've got to get out of this mind-set where somehow elite opinion is always on the side of doing things that really disadvantage the vast majority of Americans," said Clinton, a former first lady who would be the first woman president.

When Clinton or a member of her family becomes sick or injured, does she rely on "elite" physicians for care? If she becomes president, will she dismiss the "elite" pilots who fly Air Force One? Why does she need Air Force One at all — the only thing stopping people from flying around like Superman are the "disadvantageous" views of "elite" physicists.

Economics does admittedly lie in a twilight zone between the metaphysical certitudes of the hard sciences and the subjective gobbledygook of the humanities. Point conceded.

But an economic truth such as, "all resources are scarce and must somehow be rationed" is closer to a physics-based law of conservation than to a humanities-based pronouncement that "everyone has a right to..." An economic truth such as, "people respond to incentives" is closer to a physics-based "for every action..." than to a humanities-based "from each according to..." A graph containing a supply and demand curve — and the distortions government policies impose on them — is closer to a Grand Unified Theory than to a piece of indecipherable "abstract art."

To call economists "elitist" is to call economics "elitist" — which is also to call science, logic and reason "elitist."

More thoughts from — heck, too many people to cite.