Professor Kmiec on Judicial Filibusters

Professor Kmiec's commentary on judicial filibusters is worth a read.

Almost any nominee for the Supreme Court who is serious about observing the original understanding of the Constitution and a restrained judicial role can be expected to be caricatured as "out of the mainstream" and trigger the Democrat's "extraordinary circumstance" pretext to filibuster anew. . . . .

It is my view as well that the political fight over judicial nominations is primarily over how judges view their role in interpreting the Constitution.

The compromise does nothing to address the wrongful refusal of the Senate to perform its proper "advice and consent" function. Worse, it purports to forfeit freely authority reserved by the Constitution to the president — namely, his carefully articulated power of nomination.

The job of occasionally weeding out patronage appointments was never intended to invite the Senate's own crass politics. The Framers especially wanted to avoid legislative bargaining that would ignore the intrinsic qualities of each candidate — or as Hamilton put it — the sentiment that says "give us the man we wish for this office, and you shall have the one you wish for that." Hamilton's words resonate hauntingly since the filibuster compromise does just this: Give us Brown, Owen, and Pryor, but not Kavanaugh, Boyle, etc., or presumably, the next three Supreme Court draft choices.

I think it is very important to take careful note of the following:

If comity required some bipartisan agreement or statement, better it should have been an admission of complicity. Anyone critical of the filibuster for denying the entire Senate its constitutional role should also be honest. Democrats were the first to deploy the filibuster in a grand way against the judiciary, but both parties had a myriad of alternative ways in which presidential nominations were prevented from reaching the floor at all. All these practices should be condemned as constitutional defaults. The default comes at the sacrifice of accountability, or what is popularly termed transparency. Filibusters denying full-floor action or bottling up nominees in committee both dangerously, as Hamilton warned, "shut up in private [and make] impenetrable to the public eye..." the judicial-selection process.

In my view this in one of the most important considerations when looking today at the Senate specifically, and our republican government more generally. It is not clear that our elected representatives these days value public debate in the chambers of the Senate and the House. It appears that our Senators prefer to hide behind a cloture vote, or behind a "hold," or behind a "blue slip." It appears that they are quite comfortable hiding their choices from the public's view because they choose to avoid open debate on matters that seem of some controversy. It seems quite important to me that if there is controversy over a judicial appointment, then the Senators should be on record in debate on the Senate floor explaining the reasons they will cast their vote as they do. Even an "up-or-down" vote is not enough when the question is controversial. It is certainly unacceptable for the choices of the Senators to be hidden on matters controversial. It is also unacceptable for Senators not to state clearly, and publicly, the reasons they vote as they do on matters controversial. I trust our system of republican government works best when this happens, and that our system is depreciated, greatly over time, when Senators hide their choices and their reasons from public debate.

Back to Professor Kmiec:

The pragmatic defense of the filibuster was that it would supposedly yield consensus or "mainstream" judicial appointments. Obviously this remains implicit in the compromise that allows the filibuster's return whenever Democrats feel the "extraordinary" urge. In truth, the filibuster is just a political veto designed to preserve judicial outcomes that have no anchor in constitutional text. When a minority of the Senate can delay or obstruct a fully-capable nominee by reason of partisan or ideological disagreement, "factions," as Madison called them, have taken over and will erode the independence of the judiciary.

. . . .Where our fundamental charter wanted a super-majority, in overriding vetoes or impeachment, for example, it clearly provided for it. The framers specifically considered and rejected in the 1787 convention a 2/3ds Senate concurrence for judicial appointments.

Filibuster 14 & Median Voters

On O'Reilly Factor last night Dick Morris suggested something I found intriguing. He suggested that the agreement between the Filibuster 14 is like the creation a new 3rd party in the Senate. He suggested that if the agreement holds, this "new party" can control the Senate with the result being the accomplishment of Social Security Reform and other reforms he thinks are really what the American people really want.

The reason this idea is intriguing is related to the idea that the 7 Republicans and 7 Democrats are (perhaps) people whose policy views put them in the center of the political spectrum. I'm reminded of the median voter model which predicts the outcome of majority voting will be determined by the preferences of the median voter. Is it possible that a 3rd party would emerge around the median voter?

Tony Blankley seems to see the Filibuster 14 much the same way as Morris, except the implications he sees are not so positive:

Well, it would seem that the Senate has been placed in to receivership by 14 self-appointed trustees, several of whom are among the Senate's most wanton exhibitionists. Some of these ladies and gentlemen can be seen almost daily preening in front of television cameras confessing their moral superiority over their colleagues by virtue of their lack of firm convictions and their unwillingness to be team players.

Ironically, they have just formed the most exclusive club in the Senate. . . .

Let no one assume that this little assemblage of selfless senators will limit the reach of their writ to the matter of judicial appointments. As if one couldn't guess, on Monday night Sen. Lindsey Graham — the Tom Sawyer of the Senate — looking all twinkly eyed and mischievous into the television camera, promised that the wonderful 14 would soon be announcing their plan to reform Social Security. Tomorrow the World!

So begins the Regency Period of the Senate. As long as these fourteen stick together, nothing can pass the Senate.

Morris sees potential for accomplishments that would not otherwise have happened, while Blankly emphasizes nothing being accomplished. Perhaps we should also take note that Blankly's commentary points out that Senator Graham has already pointed to being able to accomplish Social Security reform.

Over at Captain's Quarters, Captain Ed also seems to take the negative view on the Filibuster 14:

Now we have a situation where our hard-fought majority has completely dissipated, to be replaced by a board of trustees that have arrogated leadership to themselves without even consulting the members of their caucuses, especially those in the GOP. And as Blankley points out, they have no intention of giving up that power as long as they can stay united. They intend on delivering Lindsay Graham's Social Security package and forcing it down the Senate's throat, complete with tax increases and an abandonment of privatization and ownership of one's retirement funds, despite a similar system for Congressmen and Senators that far outperforms Social Security. What other deals have they cut in secret, back-room negotiations? We will soon find out.

Let's add one more point of view to this mix from Glenn Reynolds:

. . . . Americans, for the most part, don't share in the reflexive hostility to religion found in the upper reaches of journalism and the academy. On the other hand, Americans don't like self-righteous busybodies -- whether of the PC left or the religious right -- telling them how to live, either.

There's a relatively small group -- under 20% of the electorate, I'd guess -- that would really like to recast American society under far more religiously determined lines. That's enough to steer the Republican party to disaster, as a similar group has done for the Democrats, but not enough to win elections much. The Democrats' problem, of course, is that they're even more dominated by their fringe than the Republicans, and the fact that the media establishment tends to share those views will make it harder for them to extricate themselves from this fix.

If both the existing political parties are moving farther to the extremes of right and left, which might be suggested by Reynold's comments, could we see a new party emerge from the realm of the median voter?

Liberals, Race & History

More Sowell

Black educational achievements are a special inconvenience for liberals because those achievements have usually been a result of methods and practices that go directly counter to prevailing theories in liberal educational circles and are anathema to the teachers' unions that are key supporters of the Democratic Party.

Many things that would advance blacks would not advance the liberal agenda. That is why the time is long overdue for the two to come to a parting of the ways.

Amending the Constitution

I was reading Cass Sunstein this morning and ran across:

Many of the Court's most celebrated decisions, even those striking down legislation, reflected the views of current political majorities.

And this:

Note that I am not attempting to defend the Court's decisions. I am simply remarking the fact that they are far less countermajoritarian than is often claimed.

These quotes are part of his discussion of the point that

the meaning of the document [Constitution] changes over time, and these changes usually arise from alterations in social values.

I think the idea is that the Supreme Court has in fact changed the meaning of the Constitution over time, and that even so, these changes have reflected changes in social values as reflected in current political majorities. It seems to me Professor Sunstein is not concerned by the Court's changes to the Constitution. I am.

Consider what our written Constitution says about changing it:

The Congress, whenever two thirds of both Houses shall deem it necessary, shall propose Amendments to this Constitution, or, on the Application of the Legislatures of two thirds of the several States, shall call a Convention for proposing Amendments, which, in either Case, shall be valid to all Intents and Purposes, as Part of this Constitution, when ratified by the Legislatures of three fourths of the several States, or by Conventions in three fourths thereof, as the one or the other Mode of Ratification may be proposed by Congress. . . . .

It seems to me that according to our written Constitution current political majorities are not supposed to be sufficient to amend the Constitution. The Constitution requires a super-majority of both houses of Congress, and then a super-majority of the states as well, before the Constitution is amended.

Isn't there something important about the super-majority requirement? I think that requiring a super-majority means that amendments to our actual written Constitution will be much more likely to be in the interest of most people, relative to a simple majority requirement. Just imagine getting 2/3 of the Senators to agree today on a proposed amendment to the Constitution. Right now the Senate cannot even get 3/5 of the Senators to support ending debate on one judicial nomination. What kind of proposed amendment could get the required 2/3 affirmative votes? Wouldn't the change have to very likely be in the interest of most people? A similar set of questions would apply to getting 3/4 of the states to ratify something, given the distribution of states between democrats and republicans.

While Sunstein may be correct in saying the the Court's changes to the meaning of the Constitution were consistent with current political majorities, my guess is that only a few of the Court's changes would have be supported by the super-majorities required by our written Constitution. Do you agree?

Are your comfortable with our written Constitution and the super-majority requirements to amend the Constitution? Or do you think we should see if we can amend the Constitution to require only a simple majority vote to approve proposed amendments? Would you consider amending the Constitution to allow the Supreme Court to amend the Constitution by a 5-4 vote, assuming that the Court sees its role as representing only changes in social values when it does so?

Yellow Dog Contracts

I was just reading an author explain that among other things the Wagner Act outlawed yellow dog contracts. A yellow dog contract was a contract by which employees agreed not to join a union. Some employers would require such contracts with employees as a condition of employment. The author seemed to support the idea that Congress was right to have outlawed such contracts.

My sense is that there is nothing wrong with such contracts, and that Congress should not have been allowed to outlaw such contracts. It seems to me that we generally believe government has the power to prohibit actions that harm the person or property of others. This power is often referred to as the police power. So, I assume that members of Congress thought they were acting to prevent harm to others when they voted to outlaw yellow dog contracts.

I can see no harm to others with such contracts. A yellow dog contract would be a voluntary agreement by employer and employee. Given the voluntary nature of the agreement by both parties, I cannot understand saying either party was harmed. Yet, I would guess that those who supported prohibiting such contracts said they did so to protect the employee. But, by prohibiting the yellow dog contract Congress uses the coercive power of government to harm the employer who would otherwise not want to hire an employee who was a union member or who would become a union member after employment. On the one hand, there is no harm because the employment contract is voluntary for both employer and employee, and on the other hand government's coercion harms the employer. It seems that we should not want Congress to prohibit yellow dog contracts because its coercion acts to harm rather than to prevent harm.

A second reason for concern about this sort of Congressional prohibition is that generally government action to prohibit something, say theft, is thought to be an exercise of the police power. It seems to me generally accepted that the police power is a governmental power which was reserved to the states by the 10th Amendment. I don't think we should allow Congress to prohibit behavior in general because Congress is not supposed to have been granted the police power when the Constitutional was ratified.

Workers Externality Victims? Just Say No To Externality Abuse

Don Boudreaux discusses a couple of cases that I tell students are illustrations of externality abuse. Here is the link found in the above comment to his second case.

The case that involves Wal-Mart moving to town and older businesses in town going out of business is surely not an externality source of market failure. If it were, then competition in general would be a source of market failure. On the contrary, the Wal-Mart case is an illustration of the very process by which we believe market competition moves economic activity toward efficiency. My favorite definition of externality is: an unintentional, nonmarket, interdependence. The Wal-Mart case cannot be a source of externality market failure because the interdependence in question occurs through the market process.

The case of workers desiring more leisure time also involves a market interdependence. Further, it is an interdependence chosen by the workers themselves. An externality is an effect of economic activity that is external to the market. The choices of employers and employees are not at all external to the market.

This is not to say that when we consider either of these issues that we may not discover inefficiency. It is only to say that we don't have externality sources of market failure to worry ourselves about. Instead, I suggest we should be looking for sources of government failure. Wouldn't government policy that restricts the number of hours a worker can work annually be a likely source of inefficiency? Efforts to argue that the government policy is correcting an externality is turning the entire concept of efficiency upside down.

Many times Wal-Mart moves into a town completely through the voluntary choices of individuals. But, also there are many times that local government is asked prevent Wal-Mart from moving in. If government agrees, this would be a source of government failure, not a source of externality market failure. I believe there are also many times that local government actually subsidizes (or bribes some would say) Wal-Mart to move into town. Such government actions would be a government failure, not an act to correct a market failure.

Unfortunately, policy analysis today seems over-run with such illustrations of assertions of market failures that aren't. Of course, this is bad enough, but the situation is seen to be much worse when it is realized that such abuses of the externality concept often mask the true source of inefficiency which is government failure.

As I often tell my students: JUST SAY NO TO EXTERNALITY ABUSE!!!!

Illegal Immigration, Wages, Minimum Wages

Bryan Caplan uses supply & demand to discuss minimum wages and the impact of illegal immigrants. His discussion is interesting and informative.

Must Read Speech

I think Professon Gaddis has given a must read speech. You can find a transciprt right here.

Congressional Beef Speech

Russell Roberts has discovered what's for dinner.

I'm riding in my car this morning and I hear this ad for beef on the radio. The voiceover is a quintessential cowboy voice. It sounds just like Sam Elliot, the guy who played "The Stranger" in "The Big Lebowski." He's talking about the primal experience of cooking meat on an open fire and then eating it. The ad ended this way: "Beef—it's what's for dinner. Funded by America's beef producers with Chekhov dollars."

Read the rest .

Exploitation & Social Justice

Social justice

"refers to the overall fairness of a society in its divisions of rewards and burdens."

I find it difficult to understand what "social justice" is supposed to mean and why this concept should be seen as the basis for a normative theory of the purpose of government. It seems that most often those who "fight for social justice" (I recall Senator Kerry suggesting that his faith leads him to fight for social justice) are advocating that the purpose of government is to redistribute income and wealth so that social justice can be achieved. My difficulty in understanding this normative theory of government is that I see government redistribution in general as government using its coercive power to take from Mutt to give to Jeff, and that generally seems unjust to me. I suspect that the advocates of social justice see government as correcting an injustice that is the result of exploitation, and that when our system of political economy is under the social justice microscope the idea is that our system is, by its nature, characterized by exploitation.

But, then, I've got to say I don't think I understand what exploitation means. I think I tend to be suspicious of the term because it is often used to condemn market exchange which I see as involving voluntary behavior in general. I don't think exploitation, of a worker for example, can be claimed when the situation called exploitation occurs because the identified exploited individual voluntarily chooses to be in the situation under review. I suspect that in general, there can only be exploitation if there is coercion. That leads me to this question: Can there be exploitation without the coercive power of government being behind the person who exploits others?

Truth Is Worse Than Fiction

Conventional politics is an unending argument about Haves and Have-Notes. Are the Haves getting more? Is it too much? Why isn't there more sharing with the Have-Nots? The Have/Have-Nots argument works to completely obscure another discussion: the Nows and the Laters. We're the Nows; our children and grandchildren are the Laters. Decade after decade, the Nows have taken from the Laters. Unfortunately, this fiscal child abuse, like the psychological kind, is hard to spot. But measure it we can, and measure it we will using a relatively new method, called generational accounting. Doing so leads to the following bottom line: Unless we adults make very large sacrifices very quickly, our kids will face lifetime net tax rates that are twice those we face!

That caught my attention. How about you? This comes from The Coming Generational Storm by Kotlikoff and Burns. I've decided this book is the first on my summer reading list. Perhaps I will have more posts on this book later.

More Sowell

Sowell on democrat politics.

I just don't think Sowell can be read too often.

Kondrake on Social Security

Mort Kondrake has an honest description of the democrat's recent approach to the Social Security reform debate. Even President Clinton seems to be advising a legitimate debate.

Social Security: It's Back

Can you hear that beat in the background? Look out I think it's a land shark: Democrat Readies Plan on Social Security.

Rep. Robert Wexler (D-Fla.) says that by imposing a 6% tax on wages above $90,000, to be paid half by workers and half by employers, the government could raise enough money to solve Social Security's financial problems for 75 years.

How can we end such disception?

I've posted several comments on Social Security already that help explain why Wexler's proposal is a really bad idea and why it is disception. Look here and here .

Congressional Spending

Congress's Latest Christmas Tree Bill Can anyone tell me by what power granted Congress in Article I, Section 8 of the Constitution, Congress claims to be able to spend on the?

children's museums
Ford & Packard museums
bridges
a garage on a University campus
sidewalks
landscaping
horse trails
parking facilities
bike paths.

Senator Reid

Senator Reid discusses confidential FBI file on the Senate floor:

"Henry Saad would have been filibustered anyway," Mr. Reid said on the floor yesterday, about the Michigan Appeals Court judge who is nominated to the U.S. Court of Appeals for the 6th Circuit.
"All you need to do is have a member go upstairs and look at his confidential report from the FBI, and I think we would all agree that there is a problem there," Mr. Reid continued.

Would I stretch my commitment to individual liberty too far to suggest Senator Reid's comments are a severe abuse of power in that his actions yesterday signficantly abridge Judge Saad's individual rights? After all, discussing the contents of confidential files in public is serious enough, but it may also be the case that Senator Reid doesn't even have the authority to review such a file.

Republican aides pointed to Standing Rule of the Senate 29, Section 5: "Any Senator, officer, or employee of the Senate who shall disclose the secret or confidential business or proceedings of the Senate, including the business and proceedings of the committees, subcommittees, and offices of the Senate, shall be liable, if a Senator, to suffer expulsion from the body; and if an officer or employee, to dismissal from the service of the Senate, and to punishment for contempt."

Furthermore, a "Memorandum of Understanding" covering the use of FBI background reports limits access to committee members and the nominee's home-state senators. Mr. Reid would fall into neither category.

Would you agree that his actions yesterday in the Senate show little respect for the liberty rights of others? Perhaps it's time for Senator Reid to look for another job?

Privately Provided Public Goods

Economists generally teach that it is difficult for voluntary individual behavior to be successful in the provision of public goods. Perhaps such difficulties can be overcome with technological change. Consider this suggestion of assurance contracts. Be sure to check on the link to fundable.org.

Mancur Olson has discussed the ability of organizations to provide themselves with public goods, and he has developed the implications of the difficulties in doing so in terms of the success of economies over time. I've mentioned Olson's work here and here. The idea is that for a group to be successful in providing itself with public goods, the group has to be able to either exert coercion and/or offer selective incentives to individual members of the group. So, it is expected to be difficult for large groups to successfully organize, but once organized large groups tend to persist. Among the implications are that over time a system of political economy can become sclerotic in the sense that an increasing number of groups within the system devote ever more money and resources to distributive activities at the expense of productive activities. As Olson explains in his book Power and Prosperity even economies that are as successful as we think ours is will fall short of the economy's potential, sometimes far short.

Question: If assurance contracts are practical and it becomes easier for groups to provide themselves with public goods, how will this effect the implications that are drawn from Olson's theories of groups and economies?

Climate & Science

Check out Robert Davis on climate science.

Several things we thought we knew about the PDO we do not, in fact, know at all. The unprecedented great Pacific climate shift of the late 1970s linked to global warming was, in fact, precedented and unrelated to global warming. And the useful predictability of the PDO for predicting west coast drought may not be useful at all, since the PDO will, apparently on a whim, suddenly become non-periodic for centuries at a time (unrelated to global warming).

The biggest problem with all of these somewhat cyclical climate shifts is that no one knows for sure that a shift has actually taken place until many years AFTER the event, when it's too late to be useful. So be wary of global warming psychics warning us of unprecedented climate shifts -- in most cases, they are only unprecedented because of the short life span of most scientists. Remember one of the absolutely fundamental and too-often unstated tenets of science -- there's little point in studying anything that doesn't vary during a scientist's lifetime.

I point to this commentary, not so much because I agree with the basic analysis, but because I think it may be worthwhile to consider how we should approach incorporating science into political debate of alternative public policies.

Consider Davis's comment: "Several things we thought we knew about the PDO we do not, in fact, know at all." As I understand scientific method, science is best at finding out what we don't know. In order to be good at identifying what is not true, science recognizes by its very methodology that it is not able to identify what is true. Instead, science proceeds by the process of scientists thinking up hypotheses, making predictions, measuring the reality of interest, and comparing the measured reality against the predictions. If there is sufficient consistency, then the hypothesis is PROVISIONALLY accepted. The provisional acceptance of the hypothesis and theory continues until it is discovered that the theory is wrong. Of course it may never be discovered that the theory is wrong. In such an event would we conclude that the theory was, as a matter of fact, true? I don't think so. We simply continue to use the theory as long as it works for us. I don't think it is at all surprising, looking historically, that there are things science thinks it knew but later discovered it did not know. I think this is merely an inherent characteristic of science.

The question is, given this is an inherent characteristic of science, how should we utilize science when we discuss public policy issues that rely on what scientists think they know about something? It seems to me that most of our political debate in such cases proceeds as though science is telling us what is factually true. Isn't such a presumption inaccurate, and therefore, isn't relying on such a presumption a poor way to approach public policy debate?

Sowell On Walmart Wages & Busybodies

Tom Sowell explores the concerns of some that Walmart isn't paying employees enough.

Think about it: What the busybodies are saying is that third parties like themselves -- who are paying nothing to anybody -- should be determining how much somebody else should be paying those who work for them.

His commentary is well worth thinking about.

Sometimes I wonder why it seems so easy for some people to neglect the value of individual liberty. When it comes to government and the economy, why can't we just let people decide for themselves where to work, what business to own, who to work for, what wage to accept, what wage to pay, etc.?

Walter E. Williams: How not to be poor

Avoiding long-term poverty is not rocket science. First, graduate from high school. Second, get married before you have children, and stay married. Third, work at any kind of job, even one that starts out paying the minimum wage. And, finally, avoid engaging in criminal behavior. If you graduate from high school today with a B or C average, in most places in our country there's a low-cost or financially assisted post-high-school education program available to increase your skills.

Professor Williams also offers instruction about not being poor.

The Children's Defense Fund and civil rights organizations frequently whine about the number of black children living in poverty. In 1999, the Bureau of the Census reported that 33.1 percent of black children lived in poverty compared with 13.5 percentof white children. It turns out that race per se has little to do with the difference. Instead, it's welfare and single parenthood. When black children are compared to white children living in identical circumstances, mainly in a two-parent household, both children will have the same probability of being poor.

The Rich

Professor Williams tells us about the rich in our country.

Farrah Gray was raised in a predominantly black Chicago neighborhood. At age 8, he started a lemonade stand business, later a venture capital business, a food business and a magazine. By age 17, Farrah Gray was a millionaire, had been chief executive of four companies, and had offices on Wall Street, and in Las Vegas and Los Angeles.

While becoming a millionaire by age 17 is rare, eventually becoming a millionaire isn't. According to TNS Financial Services' 2004 Affluent Market Research survey, there are an estimated 8.2 million American households with assets, excluding primary residences, worth over $1 million. That's a 33 percent increase over the 6.2 million millionaire households in 2003.

. . . .80 percent of today's American millionaires are first-generation rich. . . .fewer than 20 percent inherited 10 percent or more of their wealth. More than half never received as much as a dollar in inheritance. Fewer than 25 percent received "an act of kindness" from a relative greater than $10,000, and 91 percent never received, as a gift, as much as $1 from the ownership of a family business.

This points to one of the most unique features of our nation. Just because you know where a person ended up in life is no guarantee that you can tell where he started. In other words, there is so much economic mobility in our society that starting out with modest means or even being dirt poor does not prevent one from ending up at the top.

In Justice as Fairness: A Restatement John Rawls argues that one of the conditions for justice is that "social and economic inequalities . . . are to be attached to offices and positions open to all under conditions of fair equality of opportunity." It seems to me that what Professor Williams tells us about the rich in our system of political economy is a pretty good illustration of what "fair equality of opportunity" would mean in any real economy.

Cafe Hayek: Twelve Books

Looking for a good reading list? Take a look at this.

The Big Mac Tax

Hold on to your wallet in Detroit. The city of Detroit is apparently considering a special tax on fast food.

Faced with a $300 million budget hole, Mayor Kwame Kilpatrick is hoping people in this heavily taxed city won't mind forking over a few extra cents for their Big Macs and Whoppers.

Mr. Kilpatrick wants to ask Detroit voters to approve a 2 percent fast-food tax -- on top of the 6 percent state sales tax on restaurant meals. The mayor says consumers will barely notice the extra cents at the cash register. . .

If approved, the Detroit tax would be the country's first to target fast-food outlets. . .the tax would apply to anything sold at a fast-food restaurant . . .

"With Detroit, you're kind of grasping at straws because the tax base is so tapped into," Mr. Wassmer said.

Just how is 'fast food' defined? Besides the obvious chains like Wendy's and White Castle, officials have mentioned takeout pizza places and Detroit's ubiquitous chili dog restaurants known as Coney Islands. It's uncertain, however, where Starbucks or the corner deli would fall.

Is this a "fat tax," and is Detroit a nanny state?

Get out your little copy of the Constitution and look for the 14th Amendment. Can this fast food tax possibly be Constitutional? Think about it. The tax base here is not sales. The tax base here is the type of restaurant. The sales of hamburgers by an owner of a McDonalds will be taxed higher than the sales of hamburgers at the local brew pub. If you own a pizza joint and you have been letting customers take their purchased pizzas out to consume at home, then just stop sending your pizzas home and avoid the extra sales tax.

Legal Affairs Debate Club - Constitution in Exile?

The Legal Affairs Debate Club - Constitution in Exile? is complete. What do you think? I think Professor Barnett was the winner.

One reason for this conclusion is the resort to use of the word "radical" by Professor Sunstein. I don't find use of the word radical to make any sense when applied to ideas about individual freedom and individual liberty that were articulated by James Madison, "father" of our Constitution and one of our Presidents. The ideas referred to as "radical" have also often appeared in the texts of the opinions written by many different Supreme Court Justices. Professor Barnett's ideas about the meaning of our written Constitution are not at all radical. It would seem to me much easier to use the label "radical" for the belief that the words of our Constitution are not actually written in our Constitution.

Cafe Hayek: The Spontaneity of Spontaneous Order

". . .Freedom would be less appealing if when we chose, our choices couldn't be implemented or only implemented at great cost or with great delay. . . ."

"So when I marvel that the extended order of human cooperation. . .allows me to buy a dozen bagels for a brunch without having to call ahead, it's so much more than that. The greater marvel is that thousands or millions of us can make those changes and the system simply readjusts to our new desires."

Russell Roberts at Cafe Hayek has some interesting observations about spontaneous order.

"The weird part of this is that we teach our students that sudden, unanticipated changes in demand drive up prices in the short run as a way of signaling to economic actors where resources are most valued. But have we exaggerated the importance of the price mechanism? What evidence do we have that the actual prices rise very much in the face of large shifts in demand?"

He suggests that our language may constrain the way we think about and understand economic activity, and perhaps we are led to misunderstand economic activity for this reason. I suspect this is true in many ways, e.g. the way we often use the word "society" as though "society" had preferences and could make choices. I wonder if an answer to his questions about the price mechanism might be suggested with a similar observation. It seems that most of what we economists think we know about the price mechanism is related to our static model of a market equilibrium. The real "price mechanism" is not static at all. It is truly dynamic. Even our dynamic models in economics tend to have a static character. Our economic models don't seem to depict an economic world that is truly emergent and evolving. As Russel Roberts makes note, true economic activity is often emergent. Perhaps, we do not understand the price mechanism and economic activity all that well because we use models that do not facilitate our understanding of economic activity as being emergent (rather than just in terms of a market equilibrium).

Drug Prices

Doug Bandow writes

A council committee has approved legislation to create a new 'illegal trade practice' - selling drugs for more than city politicians decide is fair. The bill would allow Washington, D.C. to transfer the companies' patent rights to other firms through compulsory licensing.

It's a truly nutty idea.

I second that. Truly nutty.

Interest-Group Government

Jacob Weisberg discusses what he calls Interest-Group Conservatism:

In the late 1960s, the great political scientist Theodore Lowi coined the phrase 'interest-group liberalism' to describe an emerging system of government he viewed as untenable. In a classic book, Lowi argued that national policymaking had become theprovince of organized lobbies, which worked to the detriment of the overall public interest and spawned an uncontrollable, amoebalike federal bureaucracy.
. . . . .
In this, the third year that Republicans have controlled everything, a variation on the old interest-group liberalism has emerged as the new governing philosophy. One might have expected that once in command, conservative politicians would work to further reduce Washington's power and bury the model of special-interest-driven government expansion for good. But one would have been wrong. Instead, Republicans have gleefully taken possession of the old liberal spoils system and converted it to their own purposes. The result is the curious government philosophy of interest-group conservatism: the expansion and exploitation of government by people who profess to dislike it.
. . . .
The problem with special-interest conservatives is not that such agenda items violate their greater principles on any given point, any more than the policies promoted by Democratic interests violate liberal principles. Rather, it's that the entire enterprise of running Washington as a special-interest spoils system breeds a bloated, ineffective government . . . .

Mr. Weisberg's observation is no surprise to a fan of Mancur Olson who wrote: The Logic of Collective Action, The Rise and Decline of Nations, and Power and Prosperity.

Read the rest

Legal Affairs Debate Club - Constitution in Exile?

A very interesting debate is in progress this week about the "Constitution in Exile."

To some, restoring the 'Constitution in Exile,' as Judge Douglas Ginsburg dubbed it in 1995, means having the federal courts encourage freedom. To others, it's the signature of a movement to roll back health, safety, and wage regulations to where they were 70 years ago, before the Supreme Court embraced the New Deal.

I'm not sure I get this idea of "having the federal courts encourage freedom." It seems to me the perspective of Thomas Jefferson that we are each born with certain "unalienable rights" is pretty much opposite the perspective of "encouraging freedom." That is, the role of government in general, and the Courts in particular, should not be thought to be encouraging freedom. Rather the role of government, and the Courts in particular, should be to protect individual freedom. I would suggest that of the three branches of government it is the Judiciary that is supposed to protect individual freedom from the innumerable ways the other branches of government can act to abridge our individual freedoms. I suggest the Constitution was written with limited government and with protecting individual liberty in mind, and that prior to the Supreme Court embracing the New Deal, the Court did quite often see its role as the protector of individual liberty.

The Social Security Trust Fund is Irrelevant

Let's make it more concrete with a personal situation that many people can relate to. Say you're planning to send your kid to college. You have ten years and think you need $100,000. In Scenario A, each year you put an IOU for $10,000 in a jar. At the end of ten years, you pour out the jar, swear a bit more than is proper, and then scramble to come up with $100,000, either through borrowing, selling assets, earning more, or spending less. In Scenario B, you skip the jar and IOU charade and advance to the final step: you swear and scramble. The IOU charade was irrelevant.

This is precisely what people need to know about the Social Security trust fund. It is a charade, and it is irrelevant to the debate about reforming social security. Read the rest here.

Global Warming: The Smoking Gun?

Dr. Roy Spencer has a comment on the recent research reported by Dr. James Hansen.

In summary, the recent study by Hansen et al. indeed presents one possible interpretation of the available evidence, but it is a very human-centric one that assumes that natural decadal- to century-scale climate fluctuations are not to blame for at least some part of what has been recently observed. Or, using the 'smoking gun' metaphor, it isn't yet clear whether mankind is the perpetrator, Mother Nature is an accomplice, or vice versa.

Sowell on Illegal Immigration

Thomas Sowell has a good commentary on illegal immigration.

There is a reason why illegal immigration is the third rail of politics. Not only is there a fear of losing the Hispanic vote, there is a fear of being demonized in the media and therefore losing other votes as well.

It does seem that he is correct, both political parties in Washington seem to be running from illegal immigration as fast as they can.

When you say that Americans have a 'right' to have their 'basic needs' met, you are saying that when people refuse to supply themselves with food and shelter, other Americans should be forced to supply it for them.

If you subsidize workers when they won't work and subsidize employers by making illegal aliens available to them, then under those particular conditions it may well be true that illegal immigrants are taking jobs that Americans won't do. But such statements conceal more than they reveal.

Professor Sowell is always good at cutting through the fog of politics.

War Over Intellectual Property

Mark Schultz discusses a very important concern, i.e. a movement internationally to weaken protection for intellectual property rights.

Proponents of this new international IP [intellectual property] agenda are deeply skeptical of the benefit of intellectual property rights. They assert that access to health care and knowledge are fundamental human rights. As they see it, private ownership of intellectual property violates these rights, making drugs too expensive and interfering with obtaining knowledge and educating people in poor countries.

If the concern is truly with the poor in developing economies, then weakening protection for intellectual property is likely to be the wrong move. In order to accomplish the development of new technology the appropriate economic incentives have to exist. If an individual cannot rely on being able to capture the benefits of developing new goods and services, then the incentives to undertake the requisite risky investment activities will be missing. Protection of intellectual property rights is the means of providing and of protecting the incentives to develop new goods and services.

Having a heart for the poor does not call for getting rid of intellectual property rights. We should stop treating the people of the developing world as victims, forever at the mercy of corporations and more developed countries. Yes, we should find ways to help the poor with the needs of the moment. That short term poverty, however, does not mean that they cannot help themselves to prosper. But to do so, they need the same institutions that have helped the people of developed nations to fulfill their potential: The rule of law and private property rights, including intellectual property.

Nuclear Brinksmanship

Gene Healy at Cato Institute has interesting commentary about the Senate. By rule every bill must be read in its entirety on the Senate floor, unless there is unanimous consent to stop reading the bill. Thus, it would be very easy for the Democrats, or any member of the Senate, to "shut down" the Senate.

Bringing the Senate to a crashing halt will hardly scare those of us who believe that no man's property is safe while Congress is in session. In fact, there would be something perversely entertaining about C-SPAN programming dominated by the monotonous recitation of 700-page agriculture bills. If only the senators could be forced to sit and listen. The Intelligence Reform Bill of 2004 is 236 pages long, and it's a safe bet few senators read it in its entirety. McCain-Feingold clocked in at a mere 36 pages, yet in February 2003 The New York Times reported that the Democratic and Republican party organizations had to hire high-priced lawyers and consultants to run seminars teaching senators and congressmen about the requirements of the law they had just passed. 'I didn't realize what all was in it,' Rep. Robert Matsui (D-Calif.) said. A breakdown in Senate cooperation would lead to a period of blissful inactivity, and could help educate the public about the increasingly incomprehensible statutes Congress calls 'laws.'

"I didn't realize what all was in it." I can understand not sitting in your Senate chair to listen to the reading of a bill, but is it really wise to admit you're an elected representative and you don't "realize" all your are voting for or against?

Public choice economists explain rationally ignorant voters and the nature of the system of politics that can result. Now Representative Matsui seems to illustrate that elected officials in a republican form of government may choose to be rationally ignorant as well. If Republicans succeed in getting Senate votes for all judicial appointments, perhaps their next rule change should be to require reading all bills in the Senate, no exeptions. It may be hopeless to think Senators and Representatives would be informed about the bills the vote on, but perhaps it would be be the case that more time reading would lead to less time enacting.

Cafe Hayek: Social Security as Realpolitik

Hear is something over at Cafe Hayek worth giving some thought to.

Filibuster

Here is a story about the proposal Senator Frist made yesterday with respect to the Democrat tactic of filibustering judicial appointments. Of course, the public response by Democrats was N-O.

"This has never been about the length of debate," Mr. Reid said. Rather, it's about constitutional principle of sharing power with the minority in the Senate, he said."

There is a "constitutional principle of sharing power with the minority in the Senate?" Really? I always thought the filibuster resulted from Senate rules. I've been looking through my copy of the Constitution today but so far I can find no reference, direct or remote, to sharing power with a Senate minority. Certainly the part of the Constitution that says the Senate has the power of "advice and consent" with respect to judicial appointments makes no reference to Senate minorities.

And, there is Senator Salazar's contribution to the filibuster flap which includes referring to someone as the "antichrist." Yesterday, Salazar apologized for the antichrist comment. A spokesman for Senator Salazar also made an effort to clarify his position on the filibuster tactic.

"'He said during the campaign that he would prefer an up-or-down vote, but now that Republicans are talking about breaking the rules, he takes issue with that,' Salazar spokesman Cody Wertz said."

I believe it is correct that as a candidate Senator Salazar said judicial appointments should get Senate floor votes, but less than half a year into his tenure as a Senator he has apparently decided his campaign position is no longer correct. Can anyone say "integrity?" I don't think this clarification about rule breaking makes any sense at all. If Republicans decide to pursue the "constitutional option" this will not be breaking the rules. My understanding is that they would be following precisely the rules of the Senate that cause rules to be changed.

Speaking of rules changes, the Wall Street Journal discusses a rule that cries out to be changed. Senate practice apparently allows a single Senator to "veto" any appointment. Wow. The Senate's Constitutional power includes "advice and consent," and the Senate allows one Senator a veto over the Constitutional power of the President? What's up with that?

Panel readies bill to rid sports of steroids in sports

"House lawmakers have drafted legislation to set uniform testing standards for major U.S. sports as a way of containing the use of steroids and other performance-enhancing substances."

Because the legislation referred to has not been introduced into the House we do not know specifically what might be proposed for Congress to do regarding steroids in sports. Yet, I wonder, on what theory of government can we rely on to decide that any Congressional action is justified?

Economics would ask if there is a market failure to correct regarding steroid use in sports. Is there a reason to believe that steroid use by athletes in professional sports leads to an inefficient allocation of resources to professional sports industries? Typically the sort of regulation likely to be proposed here would fit the idea of an external cost, or a harm to people other than the players, the team owners, and the fans, that would be associated with steroid use by the athletes. I don't think there is such a harm. I think economic analysis cannot be used to justify Congressional action to regulate steroids in professional sports.

I also think that the role of government in protecting individual liberty means that Congress should not regulate steroid use. One asserted source of harm from steriod use by athletes is probably that fans may be turned off by knowing the athletes are so good because they use performance drugs. Even if true, this does not justify Congressional regulatory action because each league can decide for itself what best suits its ability to supply fans the entertainment services they enjoy. The conditions of competition within professional sports should be set by each sport alone.

Another asserted source of harm from steroid use is bound to be that steroids harm the health of the athlete that uses them. A theory of government that would say Congress should regulate/prohibit steroid use by athletes would be paternalistic. Such a theory would have us see government in a parental role. Clearly such a theory of government is inconsistent with individual liberty, and it is a theory of government that I reject.

I'm sure some will argue that professional athletes are role models for kids, and therefore, if kids know professional athletes use steroids then they will want to use steroids. Kids are simply too young to decide for themselves, and therefore, government is needed to stop adult athletes from inadvertently causing kids to use steroids. The line of cause and effect seems pretty lengthy here, and therefore, I grow suspicious that even if I accepted the theory of government behind this reason for Congress to regulate steroid use by athletes, I would have to conclude that Congress is very unlikely to pick a well targeted regulatory policy. The individual liberty of athletes would be sacrificed for an uncertain and limited quantitative impact on kids.

Further, Congress is not the parent of the kids in question. Suppose a high school football player came to his parents and said: "I'm pretty good and I think I could be good enough to get a scholarship to college and even have a good chance at the NFL, but I think that to have a chance at reaching my goals I should use steroids. What do you think? Will you help me pursue my goals in this way?" Many parents would investigate steroid use and conclude that their son should not be allowed to use the drug and they would just say no to steroid use. But, if the parents said yes, on what theory of government should we think it is legitimate for Congress to tell the parents they cannot make this decision for their son? I think government should let each parent decide what is acceptable for their kids.

One more thought occurs to me. Our Constitution expressly grants Congress certain powers in Article 1, Section 8. The theory of government embodied in our Constitution says that Congress may only act within these expressed powers. If Congress seeks to act without an express grant of power in the Constitution, then the resulting legislation would be unconstitutional. I don't think there is a expressed power in the Constitution that gives Congress the power to regulate steroid use by professional athletes. In other words, even if you find a theory of government, perhaps it is paternalism, that would justify Congress regulating steroid use, I don't think our Constitution grants Congress the power to do so.

Filibuster

An editorial by Dick Morris has me wondering. His suggestion is that Senate Republicans do not have to "go nuclear" on the judicial filibusters, and that instead they should proceed by actually following the filibuster rule as is. What would that mean?

It seems to me that the filibuster, technically, amounts to the Senate voting to not end debate. That is, there is a matter before the Senate, such as, to consent to the nomination of a Judge. Before voting on that matter the Senate has a debate, and those for and against consenting to the nomination get to state their cases. At some point debate ends and the vote is taken. But, the vote cannot be taken until the Senate votes to end debate. The filibuster, in the case at hand, amounts to the Democrats in the Senate preventing a positive vote on the motion to end debate and vote on the motion to consent to the judicial appointment.

I want to suggest that public debate on the Senate floor is good, and I'll bet you agree. Unfortunately, the Senate is not actually debating the question at hand. Instead the Senate is spending a lot of time discussing its rules. The Senate's constitutional responsibility is, at this point, being effectively hidden from public view. The Senate should be debating the pros and cons to consenting to each of President Bush's judicial appointments. And, then, the Senate should vote to consent or not.

I think Morris is correct. If the Senate Republican leadership follows what one would think would be the principles embodied it the Senate's constitutional responsibility, there will be a debate on the merits of each appointment. If the Democrats decide to adopt the tactic of not ending debate, just how long do you think it will take before the public tires of what inevitably will become the endless repitition of hot air?

What I wonder about is why do we get to the point in our political system where it is decided that rules will be softened, that rules will be weakened relative to appropriate principles and process? Why not simply debate until the Senate votes to end debate and then vote? The responsibility of our representatives is to carefully consider the pros and cons of every issue, and the public debate on the Senate floor is a marvelous mechanism for such careful and open consideration. I personally want to hear both Republicans and Democrats debate the merits of consenting to Justice Brown's appointment. I want each and every Senator to be publicly on record explaining why they vote as they do. I want each and every Senator to publicly speak on the floor of the Senate while the cameras are on and recording their thoughts and principles as they themselves choose to state them. Why have the principles and rules been weakened and/or changed so that the Senators are seemingly being allowed to hide their views from the public debate and public scrutiny?

I seems to me that where we are right now with our political system does not serve our liberty well.

Social Security Economics

Bruce Bartlett explains how the concept of present value can help us understand the financial implications of both Social Security and Medicare .

In short, we would need about one year's gross domestic product in a bond fund somewhere, backed by productive tangible asserts earning a real return, in order to pay all of Social Security's promises without either raising taxes or cutting benefits.

Imagine setting aside this year's entire GDP in productive assets so that over the life of Social Security, as the Trustees currently project that program, we could pay for the choice today of continuing the program's status quo.

As bad as this news is, however, it pales in comparison to Medicare's problems. . . .Adding up all of Medicare's unfunded costs yields a total of $68.1 trillion -- six times Social Security's unfunded liability . . . .

Let's see, I think that means Social Security and Medicare combined would require us to have set aside 7 years of GDP in productive assets to be able to pay for these programs' status quo.

The chilling conclusion is that virtually 100 percent of all federal taxes, on a present value basis, do nothing but pay for Social Security and Medicare. Unless there are plans to abolish the rest of the federal government, large tax increases are inevitable.

You may be tired of seeing posts on social security, but I think it is indeed chilling that today's political discussion seems to be favoring the status quo.

Favorite Book?

Do you have a favorite book right now on either the topic of economics or individual liberty?

Mine is noted in the post that follows.

Economic Prosperity

". . . . no country, communist or capitalist, developing or developed, has the prosperity that it could have." (p. 174)

"Some people argue that the individual behavior required for markets occurs only in societies with appropriate common culture. . . .The argument here is that some types of markets regularly emerge whether or not the participants have anything in common, and sometimes even when participants have antipathy toward one another. These markets emerge spontaneously and some of them are literally irrepressible. I call them self-enforcing markets. By contrast, some other types of markets, which I call socially contrived markets, emerge only when a society maintains certain institutional arrangements. These special institutional arrangements are found on a continuing basis only in the richest countries of the world, but their profound importance is not understood even in these countries." (p. 174-175)

". . .Without the right institutional environment, a country will be restricted to trades that are self-enforcing." (p. 185)

"We can also see why it is no accident that the developed democracies with the best established individual rights are also the societies with the most sophisticated and extended transactions (such as those in futures, insurance, and capital markets) for realizing the gains from trade. They are generally the societies with the highest levels of per-capital income." (p. 187)

"At least when a society has the appropriate institutions and government policies, the overwhelming majority of the firms that make huge profits are doing a huge service to the population. . . .A great excess of revenues over costs means that the enterprise is almost certainly putting more value into the society than it is taking out." (p. 189)

". . . .it was natural to ask how a society can obtain the types of markets that generate the rapid and sustained growth that brings a cornucopia of wealth. If we bring all of the theory and evidence together at once, we see that. . . .only two general conditions are required for a market economy the generates economic success. . . .the first of these conditions is the paradoxical condition of secure and well-defined individual rights. Rather than being a luxury that only rich countries can afford, individual rights are essential to obtaining the vast gains. . . .and to obtaining the bounteous harvests that property-intensive and contract-intensive production can yield. . . .There is no private property without government -- individuals may have possessions, the way a dog possesses a bone, but there is private property only if the society protects and defends a private right to that possession against other private parties and against the government as well. . . . .The second condition required for a thriving market economy is simply the absence of predation of any kind. . . .one other kind of predation can and often does occur even in societies with the best individual rights. This is predation through lobbying that obtains special-interest legislation or regulation and through cartelization or collusion to fix prices or wages. . . ." (p. 195-197)

These insights are due to Mancur Olson and his book Power and Prosperity: Outgrowing Communist and Capitalist Dictatorships .

AARP's Social Security Grades

Check out this interesting analysis of AARP's Social Security Proposals .

Acquisitiveness & Capitalism

I think some of the critics of capitalism, particularly those from religious traditions, misunderstand its nature because they mistakenly see an immoral acquisitiveness to be necessary for the success of capitalism. Michal Novak, in his book Catholic Social Thought and Liberal Institutions offers deeper understanding:

"This word [acquisitiveness] confuses two quite different motivations. Truly, the miser is acquisitive; he hoards, holds, wants to possess. The miser's behavior is quite different from that of the investor, the entrepreneur, and the inventor. . . . It is not having and grasping that characterize the capitalist spirit, but letting go and venturing, creating and rendering obsolete. . . . .What does define a capitalist order is, rather, the habit of abstaining from consumption and from miserly hoarding, in order to invest in creative ventures." (p. 9-10)

Evolving Constitution

From Laura Ingraham's sound bite of the week we have more Justice Scalia:

"If you have an evolving Constitution, somebody's going to have to decide, and I think that what has happened is that after 50 or 60 years of an evolving constitution, people have come to realize what is going on: that the people that they are selecting, not just for the Supreme Court, but even for the Court of Appeals, have enormous policy discretion, and I think that is what is going on. Judges have become political entities much more than they ever were."

Thinking our Constitution is a "living" constitution brings politics much more directly into judicial nominations, and perhaps this means that the Judicial branch of government is not very independent any more.

Savings & Social Security

Steven Landsburg offers another view of Social Security from an economist's point of view.

". . .If you want to address the Social Security crisis of the future, you must adopt laws that encourage saving in the present. There's nothing else you can do.

Which brings us to the President's proposal for private accounts. I like the proposal for three reasons. First, it will encourage people to save. Second, it will give people choices, and choices are good. And third, it will give more voters a stake in the capitalist system, making them more likely to vote for the sort of pro-growth policies that will improve the quality of life for us in our old age and our grandchildren.

What really matters, though, is not private accounts, It's the saving and pro-growth policies that private accounts will encourage. If we can get the same things in other ways, that's just as good."

Social Security Morality

Walter Williams has some interesting questions .

"There's a moral dimension to Social Scurity that few have the guts to address. What moral principles, consistent with liberty, justifies forcing a person to set aside a certain portion of his weekly earnings for retirement and jailing him if he fails to comply? Retirement isn't the only important item for which we should budget. How about a congressional mandate that we set aside a certain portion of our weekly earnings for housing, food, entertainment or our chilidren's education? Were Congress to propose a measure that would require each American to set aside a portion of his weekly earnings for these items, most of us would see it as tyranny. Pray tell, what's the difference in principle for a congressional mandate that requires setting aside earnings for retirmement versus a mandate setting aside earnings for housing or our children's education?"

Environment & Immigration Policy

A house editorial in the Wall Street Journal today points out that immigration policy issues involve more than homeland security. This editorial specifically notes that a policy debate within the Sierra Club continues, with at least some of the members of the Club supporting reductions in immigration on the grounds of protecting the environment. You might want to check out the web site for Sierrans for U.S. Population Stabilization. Here is a sampling of what you will find regarding this point of view:

"American over-consumption is shameful - and making more Americans just makes it worse. Until we can properly manage American consumption, we owe it to the rest of the world, to future generations, and to other species, to limit the number of Americans."

While this position is taken with respect to environmental protection, it also suggests that there are many economic issues involved in the immigration policy debate today because of the many different trade-offs implied by different policy positions. Many people seem to believe that the status quo on immigration policy is good because of economic advantages. Others believe the status quo is, on net, harmful from the economic perspective.

I hope to spend some time studying the various policy position, and I am not ready to offer my own position on all the tradeoffs. In the mean time, I would be interested in comments regarding other perspectives.

Government & Fighting Poverty

John Fund has some thoughts on government and poverty programs. The idea is that voluntary approaches are better than the compulsion inherent in government approaches. Do you think he is on the right track?

Spooner Award Winner

Randy Barnett is the winner of the 2005 Lysander Spooner Award. Barnett's book Restoring the Lost Constitution is called the best 2004 book on liberty. I think the book is fantastic, and well worth your time.

Equal Pay Day

Something called "Equal Pay Day" is being used to make the point that there is a wage gap between men and women such that women are paid 75% of what men are paid. As such, Equal Pay Day is used to suggest that the first 4 months of this year are spent by women in making up for the wage gap of the last year.

I want to suggest that caution is in order. The statistics used to report "wage gaps" such as these are medians and therefore they are aggregations. When you look at aggregated data you are unable to see the differences in the details that are aggregated. No one works in aggregate. People work individual jobs in specific settings. And people make different voluntary choices that result in the specific jobs in the specific settings. A "wage-gap" based upon aggregated information need not be the result of discrimination in the labor market.

The commentary by Carrie Lukas at National Review Online illustrates why caution is in order by telling us about Warren Farrell's Why Men Earn More. For example,

"Not only do women take more time out of the labor force and work fewer hours than do men, women also avoid jobs that require a great deal of travel or relocation. Men assume more high-risk jobs -- 92 percent of occupational deaths occur among men -- and endeavors that require braving the elements outdoors."

". . .Dr. Farrell outlines how women can increase earnings, but notes that higher pay often comes at a price -- be it greater physical risk, more time on the road, or more hours in the office."

It seems to me that "wage-gap" numbers cannot be relied upon as evidence of labor market discrimination.

Brookings on the Federal Budget

There is an interesting commentary by Robert Samuelson. He discusses a recent Brookings Institution study.

"Let me say that, in many ways, 'Restorying Fiscal Sanity 2005' is a swell report. It's a lucid and fact-filled budget primer. It proves, if proof were needed, that an aging society is the central budget problem and that almost everything else is a footnote. Indeed, the report usefully shows that, depending on how rapidly health costs grow, the budget outlook goes from abysmal to catastrophic."

". . . .In 2005, all federal spending -- the entire budget -- is 20 percent of GDP; Social Security, Medicare and Medicaid together equal 8.4 percent of GDP. By 2030, those three programs alone cost somewhere between 14 percent of GDP (lower health spending) and 17 percent (higher health spending). Inescapably, we get one or all of the following: exploding budget deficits; staggering tax increases; draconian cuts in other government programs; and abrupt reductions in services for the elderly."

Not a pretty picture, eh?

"So what does the Brookings study advise? Well, nothing. It presents various budget 'options' -- larger government, smaller government and so forth -- and possible tax increases or spending cuts. . . Asked why Brookings' experts couldn't craft a plan, co-editor Isabel Sawhill said: 'That requires values judgments -- and we don't all agree among outselves.' "

Duh.

"But if people who think constantly about government -- and don't face elections or angry voters -- won't make the hard choices, why should politicians?"

This seems an interesting and relevant question.

The question might not be so relevant if WE THE PEOPLE tended to elect true leaders as our representatives in Congress. Instead we elect people who seem more like followers since so many seem comfortable trying to run from tackling needed social security reform. It seems too many members in Congress hide from the hard choices that good governance requires.

In any case, while Samuelson's criticism of Brookings is justified, if you want to learn more about the Federal Government's budget the report by Brookings is worth looking at.

Open Space and Limousine Liberals

What is a limousine liberal? Thomas Sowell explains:

"Much of this exclusionary agenda is pushed by people who inherited great wealth and are using it to by a sense of importance as deep thinkers and moral leaders protecting the environment. The foundations and movements they spearhead are driving working people out of areas dominated by limousine liberals, who are constantly proclaiming their concern for the poor, the children and minorities."

While you are reading about limousine liberals you can also learn about some of the economic results of open space laws.

Social Security: Black and White

The featured article at Opinion Journal today is worth a look.

Democrats & Republican Government

Mort Kondrake has a good point.

"There is a way out of all this: Have real debate on each nominee. If they are really 'extreme,' as Democrats claim, let them prove it."

Democrat Senators are employing the filibuster rules of the Senate to prevent floor votes on several judicial appointments by President Bush. With respect to these appointments, not only is the Senate failing to vote for or against the appointment, but the Senate is even failing to have open debate in this most august of deliberative bodies. Is this republican government?

I have to ask what the Democrat party is afraid of? Is the Democrat party afraid of debating judicial appointments it asserts are "extreme?" Is it afraid of explaining in open public debate on the Senate floor what it means by "extreme?" Perhaps it sees too much risk that what Democrats think is "extreme" is instead widely accepted in the body politic? Perhaps it is even worse, perhaps the Democrats don't respect and value republican government? Perhaps they would prefer not to have the majority in the Senate express its views in support of President Bush's judicial nominees? If we respect and trust our republican form of government, then wouldn't we want open public debate, followed by a Senate vote of each of our Senate representatives, and then embrace the outcome of our republican government processes?

Is there a reason to require a super majority vote in general? Perhaps the requirement of a super majority vote provides some protection for the rights of those in the minority. This might make some sense if the issue was, for example, whether government should tax wealth. If those with wealth are a minority in number, then requiring a super majority vote for passage of such a tax measure would provide greater protection for those in the minority than would be the case under a simple majority vote. The super majority might reduce "tyranny of the majority."

There seems to be a flip side, which would be "tyranny of a minority." A minority of individuals might prevent the majority from acting in the broader interest of the community. When the issue involves something like wealth taxation, the super majority rule protects the individual rights of the minority while at the same time it does not really harm the rights of those in the majority.

If this makes some sense, then how might we look at the Senate Democrats using the filibuster rule to stop specific judicial appointments by President Bush. Would it be fair to argue that this harms the rights of those in the majority? It seems to me that each Senator has a constitutional duty, and perhaps this means also a right, to publicly vote for or against judicial appointments by the President. I know that I want to have each of my Senators vote and represent my interests in the matter of judicial appointments. On the flip side, if the Senate democrats end their efforts to use the filibuster rule, then they have given up no rights, nor have they acted in a way that gives up the rights of any of their constituents. Senators have the right and the responsibility to represent their consituents by voting on judicial appointments, it seems to me that no Senator has the right to a specific result.

Does this make sense?

Social Security: Ownership & Liberty

Ed Crane of Cato Institute recently wrote to Karl Rove offering the suggestion that President Bush should talk up the opportunities for ownership and freedom that can result from Social Security reform. I think this is important, and it fits well with the several posts I've offered with respect to Social Security.

Rock the Vote Loves Social Security

Rock The Vote has a new "I Love Social Security" campaign. Unfortunately, this campaign seems to rely on inaccurate descriptions of the present social security program. Consider, for example, their answer to the question "What Is Social Security?"

"It's a giant fund that pays benefits to 30 million retirees as well as 15 million members of families where a parent has died or become disabled due to injury. The benefits are different from the kind that you get in an investment program because they are guaranteed -- they don't depend on your skills or luck. They are also adjusted to provide a safety net for the middle class and to lift lower income Americans out of poverty. Your employer sets aside 6.2% of your income, matches that same amount, and sends the whole thing to Social Security. You get a benefit when your time comes. Through that mechanism, Social Security is basically a promise from your government that when you get old, after a lifetime of hard work, you won't end up in poverty."

Calling social security a "giant fund" seems just a bit inaccurate to me. There is certainly a "trust fund" related to a pile of paper called Treasury securities. But there is no pile of money stashed somewhere to pay off those securities. At the present time, the social security tax takes more money from current workers than is paid out as benefit checks to those currently retired. The extra is used to "purchase" Treasury securities. The extra which is now revenue from the sale of Treasury securities is then spent by Congress. What is purchased by the extra social security tax revenue is the promise by Congress to pay off the securities at some future date when the Social Security Administration asks. When the promise to pay becomes due where will Congress get the money? It might borrow the money by selling other people new Treasury securities, it might increase the income tax, it might reduce spending on other government programs (perhaps education, or transportation, or national defense), or it might do some combination of all three. In other words, this "giant fund" spoken of by Rock the Vote is actually a promise by Congress to, starting around the year 2017, increase borrowing, increase taxes, or decrease spending, or all of the above. Some fund, eh?

And perhaps something should be said about the idea that "your employer sets aside" a pile of money for you and sends it to social security. What your employer does is withhold from your salary a TAX payment. That tax payment is then used by government in the way I've described just above. It is spent on paying benefits to those currently retired and it is spent by Congress.

More Scalia, Please

Here is an essay by Margaret Talbot about Justice Antonin Scalia. I like this guy.

Scalia said, "People ask me, 'When did you first become an originalist?,' like they're saying, 'When did you first start eating human flesh?' 'But originalism used to be orthodoxy, he said. Only in recent times, he added, have judges become enamored of an approach based on-'Oh, how I hate the phrase!'-a'living Constitution.' Scalia uttered these last words with exaggerated disdain, as if he were holding up some particularly noxious leftovers extracted from the back of the fridge.

Scalia recited the words in the honeyed singsong voice of a well-indoctrinated child, then offered this mocking gloss: 'Every day in every way we're getting better and better. Societies only mature.' He paused. 'They never rot.'

'In 1791, the death penalty was a punishment for a felony. It was the only punishment for a felony! It was the definition of a felony!. . . .It was legal for two hundred years and nobody thought it was unconstitutional.!'

'If the Constitution is an empty bottle into which we pour whatever values-the evolving standards of decency of a maturing society-why in the world would you let it be filled by judges? I don't know what the standards of decency are out there. I'm afraid to inquire!' Scalia got a big laugh. 'Why you would want to leave these enormously important social questions to nine lawyers with no constraints, I cannot fathom.'

On 2nd thought, I LOVE THIS GUY.

Advice and Consent

Article II, Section 2 of the Constitution tells us about some of the powers of the President:

"He shall have Power, by and with the Advice and Consent of the Senate, to make Treaties, provided two thirds of the Senators present concur; and he shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the Supreme Court, and all other Officers of the United States, whose Appointments are not herein otherwise provided for . . ."

I like to think that we can understand the meaning of the Constitution in terms of the plain meaning of the words. I have two questions about the plain meaning of these words with regard to the President's power to appoint Judges of the Supreme Court.

First, the President's power to make treaties and to appoint Justices seems to be similar, with one difference. In either case the Senate gives "Advice and Consent." But, the difference is that there is specific Constitutional language that 2/3 of the Senators must concur with respect to Treaties, while that specific language is missing from the clause regarding Judicial appointments. It seems to me that the plain meaning of the words here are that "Advice and Consent" in the Senate requires only a simple majority of Senators to concur regarding Judicial appointments. Does this reading make sense? Is there another plain meaning of these words that makes sense? If so, is there another plain meaning of these words that makes more sense?

Second, I wonder what "Advice and Consent" means? My dictionary defines "advice" this way: "words given or offered as an opinion or recommendation about future action or behavior." Let's emphasize this word as offering an opinion or recommendation. As such, a Senate vote against a Judicial appointment would only be the opinion or recommendation of the Senate. The "advice" of the Senate would seem different from the "approval" of the Senate. My dictionary defines "consent" this way: "express willingness; give permission; agree." Given the meaning of these two words, what does the use of the two words together in the phrase "Advice and Consent" mean? It seems a bit like the two words are at odds with one another. To give an opinion or recommendation about a Judicial nomination doesn't seem easily consistent with giving permission. So, I'm wondering if the plain meaning of these words in combination might be something other than:

"the President nominates and the Senate either confirms the appointment or the appointment is denied."

It is not clear to me why these two words in combination clearly have this meaning. Would it make sense to say this phrase means that the Senate reviews Judicial appointments and gives advice to the President, either in favor or against, but then if the President chooses to proceed with the appointment the Senate shall agree or consent? Perhaps this is too far-fetched. But, why include the word "advice" if the meaning of this Presidential power is really:

". . . and he shall nominate, and with the Consent of the Senate, shall appoint . . . .Judges of the supreme Court. . ."

We certainly have acted as though these were the words of the Constitution. But these are not the words of the Constitution.

Social Security USAction

One of the interest groups apparently organized to fight social security reform is called USAction. I wonder if those who run this organization choose to be inaccurate, or if they simply don't understand how Social Security is presently structured? Take a look at the following where you will find:

"Social Security must remain a public insurance program that serves the interests of all Americans, rather than a business venture that serves the interests of the corporate elite."

What is not accurate in this sentence? Social Security certainly is called Old Age Insurance, but the program is not structured as insurance at all.

We insure against the risks that an event will occur that we want not to occur. For example, we insure against damage to our homes from fire. What risk would Old Age Insurance be insuring against? The risk of retiring? Surely not. It seems to me most of us, perhaps all of us, hope to live long enough to be able to choose to retire.

The Social Security program sends monthly benefit checks to people who are retired. There is no untoward event that these benefit checks pay for in general. Note that the Social Security Administration also administers the Disability Insurance program. The Disability part of Social Security is structured like insurance. People don't want to become disabled and be unable to work. They benefit from insurance that will pay them an income should they become disabled. In the case of this program there are monthly checks paid but only to those workers who have unfortunately experienced some event that has caused them to become disabled.

The Old Age part of Social Security is NOT IN FACT structured as an insurance program would be structured. If we want to accurately characterize Social Security today, we should point out that the monthly benefit checks sent to those who are retired are paid for out of the payroll tax paid by those currently working. Social Security is a transfer program that transfers income from those who are working to those who are retired.

This is not to say that Social Security should not be an insurance program. If our Social Security system were truly an insurance program, how would it be structured?

Mandating Employee Benefits

A Washington Post editorial discusses a proposed Maryland statute that would force Wal-Mart to spend more on health insurance for it's workers. The editorial suggests the state legislature is likely to pass the bill. One of the concerns voiced by the editorial is that the statute would force only this one employer, Wal-Mart, to increase spending. This seems a valid concern.

Whether only one employer is forced to increase specific employee benefits, or all employers are so coerced, what might economics tell us about the consequences of such a law? The state legislators who support the proposed bill are likely to tell us they seek to make things better for the state's workers by helping them to be better able to obtain health insurance. Do we expect their goals to be achieved? Are there likely to be unintended consequences that should lead the lawmakers to doubt the wisdom on the proposed statute?

Doesn't it seem that forcing employers to pay more for employee benefits is very much like imposing a minimum wage? After all, the statute would seem to be increasing what an employer has to pay to hire another hour of labor. If this makes sense, then wouldn't we predict that the results of making this proposal a law would be that Wal-Mart would want to reduce the amount of labor employed? And, wouldn't Wal-Mart hiring less labor mean that while some workers might be better able to afford health insurance, there would be other workers who were less able to afford health insurance? Would you predict other inintended consequences? What might happen in the long run? Would Wal-Mart want to decrease payments to other types of employee benefits? Could there be an impact on the ability of Wal-Mart employees to be successful in their efforts to unionize?

Constitutional Amendment?

There is a conference tomorrow at Duke University Law School on Reforming the Supreme Court? In a commentary in the Wall Street Journal today, Steven Calabresi and James Lindgren discuss one possible reform which is ending life time tenure for the Justices. Specifically they discuss an amendment to the Constitution that would limit the terms of Justices to 18 years. The terms would be staggered so that one Justice's term would expire every 2 years. I think such an amendment has merit. What do you think?

Papal Economics 101

Robert Sirico has an interesting essay in today's National Review Online.

"Where did Pope John Paul II stand on economic issues? The same place he stood on all other issues involving the well-being of the human person. He favored the rights and dignity of all people, their freedom to work and create, an environment of society that permits the flourishing of families and communities of faith. He had faith in freedom and no love for the grand secular faith in the state. Thus did this pope understand something that a surprising number of pundits and intellectuals have yet to fully understand, namely that human dignity implies non-socialist political and economic structures, which are commonly known as the business economy."

Social Security's Startling Plan

Economist Robert Samuelson notes a little noticed tidbit in the recent report of the trustess of Social Security:

". . . .Here's one startling fact that emerges from a close examination of the reports: by 2030, the projected costs of Social Security and Medicare could easily consume -- via higher taxes -- a third of workers' future wage and salary increases. We're mortgaging workers' future pay gains for baby boomers' retirement benefits."

I've got an idea. Let's figure out how we can talk the country's young college graduates into wanting to be a part of a government program that plans to take from them a 1/3 of their future salary increases. If we can do that, then we don't have to worry about reforming Social Security any time soon.

Constitutional Justices

Here's an economist's view on the Constitution and the judiciary. Walter Williams writes:

"Many law professors, and others who hold contempt for our Constitution, preach that the Constitution is a living document. Saying that the Constitution is a living document is the same as saying we don't have a Constitution. For rules to mean anything, they must be fixed. How many people would like to play me poker and have the rules by 'living'? Depending on 'evolving standards,' maybe my two pair could beat your flush."

More Social Security

Check this essay by Arnold Kling. He wonders how you would convince a young worker to either voluntarily contribute to social security or to vote to coerce all workers to participate. Jefferson might like this essay as well.

Secular Founding?

In a show April 1 Bill Maher said: ". . .I don't feel like anybody is speaking out for secular America. You know, the one the founding fathers wanted?" You can check the transcript if you're interested. I guess I'm not sure what he means to say because I don't think the founding fathers wanted a secular America.

Consider the words of the First Amendment: "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof . . . " This fundament right, listed first in the Bill of Rights, doesn't sound like the founding fathers were seeking a secular America since the language here suggests they respected the individual's free exercise of religion. They certainly did not want Congress to pass a statute saying that there would be an official United States Church, but this was not because they wanted a secular America. Rather, because there were different church denominations, they wanted government to be "blind" to religion, so to speak.

In his book On Two Wings Michael Novak writes about the views of James Madison (described by many as "the father of the Constitution"): ". . . . Madison wanted the church to pass through society invisibly, never being touched by any notice from the state . . . . His motive was not secularism. On the contrary, he thought the churches would be stronger the freer they were from government assistance . . . . Indeed, Madison boasted in later years that the American model of separation -- even if not as pure as he had wanted it -- had led to an unprecendented vitality in the churches, especially when compared with Christianity in Europe." (p. 57)

Or consider John Adams (later to be President) in 1798: "We have no government armed with power of contending with human passions unbridled by morality and religion. Avarice, ambition, revenge, or gallantry, would break the strongest cords of our Constitution as a whale goes through a net. "Our Constitution is made only for a moral and religious people. It is wholly inadequate to the government of any other." (p. 71 in Novak's book)

Perhaps it is sufficient to add just one more quote from one of the founding fathers. In 1789 President George Washington issued his first Thanksgiving Day Proclamation: "Whereas it is the duty of all Nations to acknowledge the providence of Almighty God, to obey His will, to be grateful for His benefits, and humbly to implore His protection and favor. . . . Now therefore I do recommend and assign Thursday the 26th day of November next to be devoted by the People of these States to the Service of that great and glorious Being, who is the beneficient Author of all the good that was, that is, or that will be. That we may then all unite in rendering unto Him our sincere and humble thanks, for His kind care and protection of the People of this country previous to their becoming a Nation, for the single and manifold mercies, and the favorable interpositions of His providence, which we experienced in the course and conclusion of the late war." (p. 23 as cited in Novak's book)

Mr. Maher apparently wants a secular America. I don't think we can say the founding fathers had such a goal.

I suggest Senator Lieberman is a better source on these issues. On the Meet The Press show of March 27 Senator Lieberman said it well: ". . . Look, I want to say generally, very briefly, that the mix of God and government, of religion and politics, is quintessentially American, and it was there at the beginning. The fact is that in the first American document, the Declaration of Independence, the founders of our country said that they were forming the new government to secure the right to life, liberty and the pursuit of happiness that they saw as the endowment of our creator. So this government, this country was not neutral about God right at the outset. . . ." And just a bit later he said: ". . . .But I think that the public square is greatly strengthened and enriched when people are prepared to speak, not just about secular notions of justice, but about the moral sense that our faith gives us. . . . And again, I want to say that to me that is not un-American, that is very American. We are -- our Constitution says we don't establish a religion, but it also says everybody has freedom of religion, and everybody has the right to speak their mind. And if your mind is faith-based, God bless you. Speak your mind."

I would add, if your mind is not faith-based, that's your business. Speak your mind.

What Minimum Wages Mean

There is a political cry in the air these days to increase the minimum wage. Most any student who has ever taken a course in Principles of Microeconomics has heard that the demand and supply cross of the economist shows that a minimum wage decreases the amount of labor employed and leads to unemployed workers. But the graphical models of the economist may lead students to not truly understand how a minimum wage works in the real world. If you want to get your hands dirty with the economic reality of an increase in the minimum wage, then you need to click right here.