Agregador de canales de noticias

Fox News and Julian Assange

the economistMar, 21/05/2013 - 18:18

THE first outraged tweet I saw about it came from the Associated Press's Ron Fournier: the Department of Justice (DOJ) had "tracked Fox News reporter via key card and seized personal emails. #Chilling @AP". That turned out to be a little off-point. The DOJ had checked the visit log of Fox News reporter James Rosen as he was entering and leaving the State Department one day in 2009, and that of State Department officer Stephen Kim, to back up the suspicion that Mr Kim had leaked information from a top-secret intelligence report on North Korea which had just been distributed that day, and which led to Mr Rosen's article a few hours later. This seems unsurprising, and no more or less upsetting than checking an old-fashioned sign-in book would have been. Further, the DOJ had gotten a search warrant from a judge to read two days' worth of Mr Rosen's emails. This goes significantly further, but in a sense it's not terribly surprising either: in an age when the FBI can issue secret National Security Letters to get the authority to read anyone's non-encrypted electronic communications for virtually whatever reason they want, it seems rather quaint to be outraged that the DOJ is using the old-fashioned, relatively transparent route that requires it to show probable cause and get a warrant first.

But the question remains, why did the judge grant the government a warrant to search a reporter's emails? And that's where the troubling part comes in. To convince the judge there was probable cause, the government said it believed Mr Rosen had been a "co-conspirator" with Mr Kim, because he had actively solicited the leak. It is not a crime in America to publish classified information, but it's a crime to leak it, and in this case, the Obama administration was saying Mr Rosen was culpable for encouraging an official to leak. That sort of charge does have a chilling effect on the press: it's supposed to be a reporter's job to press sources to leak as much information as possible. When reporters worry they might land in jail for pushing their questions too hard, that's basically the definition of "chilling effect".

Here's the thing, though: while the DOJ charged Mr Kim in 2010 under the Espionage Act, it did not actually charge James Rosen as a co-conspirator in the case. Prosecutors presented the theory that he was a co-conspirator to the judge when they wanted access to emails they needed as evidence to charge Mr Kim with leaking, but having obtained the emails and charged Mr Kim, they then left Mr Rosen alone. If they were seeking to intimidate the press, burying this accusation in a search-warrant request and then declining to follow up on it is an odd way to do so. Indeed, the government kept the search warrant secret for a year, and it's taken three years for a newspaper to finally notice it happened.

There is, however, another prominent figure whom the US government has aggressively and publicly sought to prosecute as a co-conspirator for encouraging a US government official to leak classified documents. That would be Julian Assange, the founder of WikiLeaks, and currently an international fugitive holed up in the Ecuadoran embassy in London. Let's go to Glenn Greenwald:

That same "solicitation" theory, as the New York Times reported back in 2011, is the one the Obama DOJ has been using to justify its ongoing criminal investigation of WikiLeaks and Julian Assange: that because Assange solicited or encouraged [US Army Corporal Bradley] Manning to leak classified information, the US government can "charge [Assange] as a conspirator in the leak, not just as a passive recipient of the documents who then published them." When that theory was first disclosed, I wrote that it would enable the criminalization of investigative journalism generally...

That's what always made the establishment media's silence (or even support) in the face of the criminal investigation of WikiLeaks so remarkable: it was so obvious from the start that the theories used there could easily be exploited to criminalize the acts of mainstream journalists. That's why James Goodale, the New York Times' general counsel during the paper's historic press freedom fights with the Nixon administration, has been warning that "the biggest challenge to the press today is the threatened prosecution of WikiLeaks, and it's absolutely frightening."

The mainstream press, regardless of ideological colouration, has reacted with uniform anger to the revelation of the buried years-old co-conspiracy theory the government used to get its search warrant on Mr Rosen. The New Yorker's Ryan Lizza has been tweeting furiously about it. There was no such solidarity in reaction to the government's open, public accusations against Mr Assange. Indeed, Fox News commentators were dismissive of Mr Assange's free-speech claims; further on the right, the Washington Times* ran an op-ed piece advocating that Mr Assange be assassinated, and National Review Online's Jonah Goldberg wondered puckishly why he wasn't dead already. Yet Mr Assange's actions were formally exactly the same as those of Fox News's Mr Rosen: he encouraged an American official to leak top-secret information, and then he published it.

What we are seeing here is basically class solidarity on the part of the mainstream press. When the offender was just a weird foreign hacker running a blog staffed with encryption-happy radical volunteers, people who thought of themselves as regular journalists were often disdainful of the effort and ambivalent about how the government treated him. Yes, he felt the full force of the US government come down on his strange white-blonde head, had his money flows interdicted, and ended up as an international pariah, but you know, what he did was pretty shady, right? But now that it seems the US government has leveled the same charges, for the same behaviour, against someone working in the classic model of mainstream American journalism, a regular old reporter like us—well, that's another story.

*Correction: We initially identified the Washington Examiner as the newspaper/website that ran the assassination op-ed. It was the Washington Times. Apologies to the Examiner.

(Photo credit: AFP)

A destructive streak

the economistMar, 21/05/2013 - 14:29

  • A large tornado roared through the suburbs of Oklahoma City on Monday, flattening neighbourhoods with winds up to 200 miles per hour. Source: AP
  • The tornado was at least two miles wide and remained on the ground for around 40 minutes. Source: AP
  • Plaza Towers (pictured) and Briarwood elementary schools both suffered direct hits. Source: AP
  • Teachers carry children away from Briarwood elementary school. Source: AP
  • A boy is pulled from beneath a collapsed wall at the Plaza Towers elementary school. Source: AP
  • A rescuer searches the wreckage of a car. As of Tuesday morning, 24 people were confirmed dead. A further 200 people were injured. Source: Reuters
  • A woman walks near a destroyed home. Barack Obama signed a disaster declaration for Oklahoma City on Monday night. Source: AP
  • Gene Tripp sits in his rocking chair where his home once stood. Source: AP
  • A Category 5 tornado that struck this area in 1999 caused around $1 billion worth of damage, making it one of the costliest tornadoes on record. The full extent of damage caused by this tornado remains unclear. Source: AP
  • The Federal Emergency Management Agency (FEMA) has already deployed personnel, and the Red Cross has opened shelters around the region. Around 38,000 people remain without power. Source: EPA

OVER the course of three days in April 2011, around 300 tornadoes touched down around the south, centred in Alabama. At least one of them was large, but many were not, and it was shocking to see the amount of devastation even a small tornado could rain on a targeted area. I drove down streets thick with workday traffic, then peered around corners and saw now-empty lots strewn with giant-sized toothpicks—the remnants of houses, foundations still protruding uselessly from the churned earth—and overturned cars.

The tornado that hit the Oklahoma City area yesterday was, alas, immense. At least two miles wide, it touched down at 2.56pm, then cut a destructive north-eastern path through Newcastle and Moore, both Oklahoma City suburbs. It remained on the ground for around 40 minutes. Preliminary reports from the National Weather Service say it was a Category 4 tornado on the Enhanced Fujita Scale; winds may have reached 200 miles per hour. Yesterday morning the National Weather Service warned of severe storms in precisely that area. A forecaster warned of tornadoes and "giant, damaging hail" and fast-developing storms, and he noted that "we do have schools in session...and that is a big, big concern for us as we expect severe weather potential to peak in that 3-6pm timeframe today." That, alas, was prescient: Plaza Towers and Briarwood elementary schools both suffered direct hits. As of Tuesday morning, 24 people were confirmed dead. A further 200 people were injured.

Now begins the rebuilding and clean-up process. Barack Obama signed a disaster declaration for Oklahoma City on Monday night, making federal disaster-relief programmes available. The Federal Emergency Management Agency (FEMA) has already deployed personnel, and the Red Cross has opened shelters around the region. Around 38,000 people remain without power. A Category 5 tornado that struck Moore in 1999 caused around $1 billion worth of damage, making it one of the costliest tornadoes on record. The full extent of damage caused by this tornado remains unclear. Meanwhile, the tornado threat heads to Texas, Louisiana and Arkansas, while the Oklahoma City area remains at risk of severe thunderstorms today, which could hamper relief efforts.

Update: The medical examiner's office initially overstated the number of people killed by the tornado: apparently some corpses had been counted twice. This post has been updated to reflect that.

Gallery, Charts and Calendars:  20130525_OklahomaTornado

How can you tell a charity from a political front?

the economistLun, 20/05/2013 - 15:58

THE New York Times had a nice discussion group the other day between legal experts on how to solve the problem of 501(c)(4)s. Basically, this category of non-profits is supposed to cover groups like the Sierra Club, the NRA, and the AARP, which have clear public-benefit programmes (environmental defence and research, gun-use education, and support and social organisation for seniors) but also naturally want to engage in lobbying and some political activity in pursuit of their causes. However, after the Citizens' United ruling in January 2010, the IRS saw an explosion in applications for 501(c)(4) status; as the tea-party movement gathered strength, applications went from 1,751 in 2009 to 3,357 in 2012.

Some of those applications, such as that of Karl Rove's Crossroads GPS, set off alarm bells at the IRS, because they clearly seemed aimed at allowing purely political groups to benefit from the perks of 501(c)(4) status, especially freedom from having to disclose who your donors are. To figure out which 501(c)(4)s were actually political front groups, the IRS started singling out for extra scrutiny conservative names like "tea party" and "patriot", without also looking for corresponding liberal names like "progressive" or "rainbow". That created effective political discrimination against conservatives—not that a pseudo-ideologically-balanced checklist of names would have been much better. But if the IRS isn't allowed to use organisational names that suggest a primarily political purpose as a guide, how is it supposed to figure out which groups deserve more scrutiny?

It can't, argues John Colombo, a law professor at the University of Illinois. He thinks we should scrap 501(c)(4)s entirely.

[T]he Internal Revenue Service will never be able to satisfactorily police the line at which political activity becomes “primary." Since “issue advocacy” (for example, lobbying) is permitted in any amount, the problem isn’t just one of identifying when political campaign activity becomes primary; it is also identifying the line between permissible issue advocacy and political campaign activity.

...Further, the (c)(4) designation has no real purpose. The best explanation, in my view, for tax exemption for charities is that it is a sort of partial government subsidy for organizations that offer services that the private market will not offer, and that government either will not or cannot offer directly. I find it hard to believe that lobbying suffers from such a serious market failure that we need to subsidize organizations whose primary activity is to lobby. In fact, it seems almost perverse that the government would subsidize organizations whose primary purpose is to lobby the government.

Rosemary Fei, a lawyer at the firm Adler & Colvin, disagrees. She thinks some organisations aren't selflessly aiding the downtrodden enough to be granted 501(c)(3) charity status, but still have public-benefit orientations that ought to let them operate tax-free. Meanwhile, some charities, like the Sierra Club, AARP and NRA examples above, "are too politically engaged to be charities, yet they work toward what each believes will be a better world."

Charities who find Section 501(c)(3)’s restrictions hamper their advocacy, often create a (c)(4) affiliate to pursue their lobbying agenda. Health maintenance organizations, low-income housing providers and homeowner or neighborhood associations are all examples of groups that may confer too much private benefit on their members, tenants and residents to qualify for (c)(3) status, yet their contributions to the social welfare are undeniable and warrant their continued exemption from federal income taxes.

I don't really have a decided take on this question. But I would put an asterisk next to Mr Colombo's pessimism that it's possible to distinguish whether an organisation's primary purpose is politics or social welfare. I think it's pretty easy to draw that distinction, in a society that decides it's interested in drawing the distinction. Societies that want to create a line between two fields of public activity are capable of doing so; we already do this in many ways. For example, the distinction between politics and the law is drawn very clearly in the US, because so many powerful social actors have a strong interest in policing those boundaries. Go to Russia or Vietnam, and you see how fuzzy and fluid those boundaries quickly become in societies where most social actors are interested not in separating politics and the law, but in blending them. (Not even an outsider can pretend to delineate a clear line: in a country where everyone violates tax law because it is impossible to comply with tax law, is it "justice" or "politics" when one person is prosecuted for it, or when they're not?)

The problem in America at the moment is that we have a vital, relentlessly competitive political sphere that is gradually colonising the domain of social welfare. Where there are still apolitical social-welfare causes, political groups see their interest in dividing and polarising those causes with one political tint or the other. We've seen this process play out over decades with Planned Parenthood, the Boy Scouts, the environmental movement, and most recently with the scientific establishment. A different kind of society might strongly stigmatise people who set up organisations that pretend to be social-welfare outfits when they are in fact almost entirely devoted to helping one party or the other win an election. This particular issue does not arise in many other advanced democracies, though they have democratic problems of their own. In any case, we're not interested in enforcing these kinds of distinctions right now; we throw up our hands and say "one man's politics is another man's social welfare".

Given that situation, I think Mr Colombo is probably right that we should just do away with the category. Of course that's not going to happen either, because the very same rampant politicisation has also paralysed our government and made it impossible to pass problem-solving legislation of this sort, or indeed any sort at all.

Uncontrolled demolition

the economistVie, 17/05/2013 - 23:50

SYRIA has been in a state of civil war long enough that it's now beginning to disintegrate, reports Ben Hubbard of the New York Times. His lead paragraph reads like a dispatch from the Wars of the Roses, or a trailer for a new season of Game of Thrones.

The black flag of jihad flies over much of northern Syria. In the center of the country, pro-government militias and Hezbollah fighters battle those who threaten their communities. In the northeast, the Kurds have effectively carved out an autonomous zone.

...Increasingly, it appears Syria is so badly shattered that no single authority is likely to be able to pull it back together any time soon.

Instead, three Syrias are emerging: one loyal to the government, to Iran and to Hezbollah; one dominated by Kurds with links to Kurdish separatists in Turkey and Iraq; and one with a Sunni majority that is heavily influenced by Islamists and jihadis.

“It is not that Syria is melting down — it has melted down,” said Andrew J. Tabler, a senior fellow at the Washington Institute for Near East Policy and author of “In the Lion’s Den: An Eyewitness Account of Washington’s Battle with Syria.”

Very well then. What if Syria did fall apart? We know there's no political will for an American military intervention to help the rebels drive out the Assad regime. That's partly due to America's exhaustion after more than a decade of war in Afghanistan and Iraq. It's partly due to the difficulty of any intervention; with Russia supplying the Syrian government with advanced antiship cruise missiles and so forth, this war would not resemble the relatively easy campaign in Libya. And it's partly because the rebels are unlikely to form a successful government, and that even if they do, it's unlikely to be friendly to America, or to be a net improvement for liberty and human welfare over the Assad regime.

But what about trying to just end the bloodshed and freeze the current situation? Given that the country's population has effectively split into irreconcilable warring camps, wouldn't it be best for all concerned if those camps were each acknowledged as legitimate in their areas of control? If those areas of control are more homogenous than the overall Syrian state, couldn't that form a more stable basis for governance? Should America aim for a resolution along those lines in the talks it's convening with Russia?

Maybe. Then again, maybe not. The problem with formally acknowledging armed secessionist groups as soon as they gain control over a patch of territory is that it encourages new armed groups to secede, provoking yet more civil wars. (See under: Yugoslavia.) And in the middle east, hopes that such splinter groups will grow into non-belligerent stakeholders once they've become responsible for controlling populations and territory are often disappointed. (See under: Hamas; Gaza.) 

The tableaus of death and suffering that are being broadcast from this civil war are horrifying. This generates a certain amount of political will for the United States to intervene and do something. It's hard to countenance a version of international morality in which the world's most powerful country sits back in the face of the slaughter of tens of thousands of civilians and simply does nothing. Listening to C.J. Chivers's interview a few weeks back on Fresh Air, you could feel the desperation of the Syrian rebels he's traveled with, and their families and other civilians—people who decided to revolt against a dictatorial regime, or who simply found themselves on the wrong side of the territorial, confessional or ethnic lines, and are being slaughtered for it, with no help arriving from the so-called civilised west. And yet even if the American public had the political will to intervene, there seems little reason to believe it would lead to any greater stability, any less slaughter, any less misery.

Back in the early 1990s, it seemed plausible to believe that with the Cold War divisions having evaporated, the strong liberal democracies could use their military power to ensure, at a minimum, that governments not be permitted to massacre their own populations. In some places, they can. But Syria looks to be one of those cases where they can't.

Pointless, punitive and permitted

the economistVie, 17/05/2013 - 17:00

A REPORT released earlier this month by the Census Bureau found that in 2012, for the first time, voting rates of black Americans exceeded that of whites: 66.2% of eligible black voters cast ballots in the last presidential election, compared with 64.1% of whites (in 2008, the numbers were 64.7% of blacks and 66.1% of whites). Beneath those top-line numbers, however, lie significant gender-based disparities in voting. More than 70% of black women voted, while just 61.4% of black men did. Black women voted at higher rates than white men and women; black men's voting rates appear to be lower. I say "appear" because the Census Bureau's numbers do not take felony disenfranchisement into account. When you do that—when you subtract from each of the four race/gender-based categories those members who cannot vote because they have been convicted of a felony, leaving you with a pool of truly eligible voters—the share of black male voters rises to 68%. That is still lower, but only just, than black women, and higher than the share of white voters of either gender.

Around one in every 40 American adults is ineligible to vote due to a felony conviction. While most states forbid felons in prison from voting (Maine and Vermont are the only exceptions), 19 others also forbid those on parole or probation from voting and 11 states disenfranchise felons even after they have served their time, accounting for nearly half of the 5.85m disenfranchised. That number is five times higher than it was in 1976. It includes one in every 13 black adults, and in three states (Florida, Virginia and Kentucky), more than one in every five.

And to what end? Sound arguments in favour of disenfranchising felons are hard to come by; advocates instead seem to prefer arguing against those who oppose felon disenfranchisement. Roger Clegg, for instance, barely makes "The Case Against Felon Voting", as his article title promises; instead, he merely argues that the practice has a long history, going back not just to the country's founding but to British and Roman law too; that such laws are not unconstitutional and were enacted with "a race-neutral purpose"; and that federal courts are split on the question of whether the Voting Rights Act (VRA) can be used to strike down felon-disenfranchisement laws on the grounds that they disproportionately affect minorities. Making the case that neither the constitution nor the VRA invalidate such laws is a far cry from making the case for such laws.

But in the last two pages of his article he finally gets around to arguing for rather than just against. He cites Henry Friendly, a federal judge, who wrote that "it can scarcely be deemed unreasonable for a state to decide that perpetrators of serious crimes shall not take part in electing the legislators who make the laws". But of course this leaves open the question of what constitutes "serious crimes". Someone convicted of sedition? Sure: if you are found guilty of trying to overthrow the country, have your vote stripped. But someone convicted of possessing a couple of ounces of marijuana? Of getting in a bar fight? Someone from a poor neighbourhood who sold drugs? What is the rationale, aside from pure punishment, of taking away their right to vote? Someday those people—like most felons—will one day get out of prison, and all of us have an interest in doing everything possible to make sure they don't go back: to make sure that they become taxpayers rather than wards of the state. Voting reminds people that they are part of a polity. Mr Friendly's quotes also leaves open the question of how long felons should be denied the right to vote. There is an immense difference between a state refusing to set up voting stations in prisons and stripping anyone convicted of any felony of their voting rights forever.

Edward Feser rallies to the cause by pointing out that conviction often entails multiple punishments. Drunk drivers, for instance, often lose their licenses and pay fines. Similarly, advocates of disenfranchisement believe that "a punishment of incarceration without disenfranchisement...would be too lenient." But of course drunk drivers put others at immediate risk of injury or death by driving the car that their license entitles them to drive. Removing it bears some logical relation to their conviction. The same cannot be said for removing all felons' right to vote. It serves no deterrent purpose, and exists solely as an additional punishment not logically connected to the crime committed. Mr Feser's fondness for "incarceration and" could just as easily be applied to forbidding felons from using telephones, or wearing shoes, or eating onions. When you decide the primary goal of incarceration is punishment, not rehabilitation, then anything becomes permissible.

Both he and Mr Clegg are far too glib, too, on the subject of race. Yes, laws disenfranchising felons may have been race-neutral in intent and in theory. However race-neutral such laws may be in theory, in practice they are anything but, as the chart cited above shows. Simply saying that the laws apply to white felons as well as black and Latino felons is like saying that the law forbids the rich and poor alike to sleep under bridges. It does American democracy no favours to keep from the ballot box nearly one in ten members of a group of people who, by virtue of the amount of melanin in their skin, were denied that very fundamental right for most of America's history.

Ultimately, Mr Clegg admits "room for reasonable compromise" on felon voting, which makes sense. One could reasonably argue that people sentenced to life without the possibility of parole are permanently segregated from the world outside prison, and so should not have the right to influence it. But there exists no such reasonable argument for permanently disenfranchising anyone ever convicted of any felony at all.  And Mr Feser does his argument no favours when his essay descends into spittle-flecked shin-kicking at the end, fulminating that allowing felons to vote "devalue[s] the franchise by throwing it away on murderers and other criminals, whose fellow citizens' blood is still fresh on their hands." Most disenfranchised felons are not murderers. Most felons will eventually rejoin society, and a conviction should not be a permanent scarlet letter. Ultimately, the best argument he and Mr Clegg can produce is that laws permanently disenfranchising felons are not unconstitutional. But that only makes them (arguably) permissible, and not all things permitted are desirable, just or sensible.

(Photo credit: AFP)

Plot hole

the economistJue, 16/05/2013 - 23:13

THE inquiry into the Benghazi affair is lending increasing substance to opponents' charges that the Obama administration massaged its talking points on the attacks, playing down the possible involvement of al-Qaeda-linked extremists and playing up linkages to an anti-Muslim video, in order to [EXPLANATION OF WHY THIS WOULD MAKE SENSE TK].

Let us return to the basics here, because what's going on in Washington right now is devoid of reason.

Yesterday the White House released a large dump of emails detailing the process of talking-point revision that took place in the run-up to Susan Rice's talk-show appearances in September. Those emails show a long series of contested revisions between staffers in the State Department, the CIA, and the White House over whether or not to include mention of al-Qaeda, whether or not to note CIA warnings of possible attacks, and various other topics. The CIA wanted to fend off possible accusations that they were at fault for failing to protect the Benghazi location. The State Department wanted to protect itself from what it felt was a CIA effort to blame it for insufficient security, particularly since, as is now known from testimony (though not mentioned in the emails, and obviously not in the talking points themselves) the Benghazi outpost was primarily a CIA operation. The White House intervened, in its own words, to protect the "equities" of the different agencies. Conservatives charge, however, that White House intervention was biased towards the State Department.

At this point the key question is becoming clear. That question is, as it has been from the beginning: who cares?

The accusation made at the start of the Benghazi affair was that the administration had mischaracterised the attacks and misled the American people in order to protect itself in the presidential campaign. This accusation never made any sense, because there was no electoral advantage to be gained by implying that the attacks at Benghazi were pre-planned rather than spontaneous, or that al-Qaeda was or was not involved. In the current round of shark-feeding, the accusation seems to be that the administration intervened in order to shield the State Department from the CIA. This appears not to be true; the initial ABC report last Friday on which it was based turned out, once the full emails were revealed, to be false and based on altered quotes. But if it were true, so what? Or perhaps the accusation is that the administration intervened in order to minimise the impression that State or the CIA had made serious errors by failing to adequately protect the Benghazi mission. But the subsequent independent inquiry quickly did come to that conclusion. If the administration happened not to make that statement in its immediate response three days after the attacks, and instead left it for an independent inquiry that came out a month later, what difference does that make?

There have been more serious accusations during the course of the hearings. The most serious was that the administration or senior military officials intervened to deliberately order units that could have come to the aid of the besieged mission to "stand down". These accusations have the disadvantage of being both untrue and completely crazy, not to mention slanderous towards the US military, and have been thoroughly debunked.

So what are we talking about here?

What we're talking about, at this point, is one thing. In November, Jay Carney, the White House press secretary, told the press that the talking points Ms Rice received had only been altered once, to change a minor terminology issue, and that this had come at the behest of the intelligence services. That was false. Why did Mr Carney say it? It's hard to figure out. It certainly would have helped end the controversy more quickly if it had been true, but given that it wasn't true, it clearly helped prolong the controversy. And the press that reported Mr Carney's lie is naturally furious. That's reasonable. I've been lied to by government spokespeople on subjects that were far more serious than this one, and it sure is infuriating. Spokespeople should not feel that they can get away with telling little white lies to the press. If they think they can, they may lie on matters of consequence.

This, however, is not a matter of consequence. How extensive the edits were on the talking points that Susan Rice used for TV appearances on one Sunday in September, and whether they came only from CIA or from CIA, the State Department, and the White House—this makes no difference to anyone outside the DC political and press community. Washington is obsessed by this affair. People around the world should recognise that Washington's obsession with this affair is yet another sign that America's capital is turning into a self-obsessed viper pit of scheming courtiers who care only about winning favour and office, and not about governing the country they're supposed to be running.

Spanner in the works?

the economistJue, 16/05/2013 - 16:03

THE scandal over the Internal Revenue Service targeting conservative non-profit organisations for extra scrutiny comes at an inauspicious time for the Obama administration. When Obamacare goes in to full effect in January, the IRS will be vested with an array of new powers. Americans will be required to prove to the agency that they have a "qualifying" health plan, or pay a penalty. The IRS is also charged with passing confidential tax info to the Department of Health and Human Services, which will determine eligibility for new health-care subsidies. Americans will be required to report changes to their lives that might affect their eligibility for subsidies. A new job, a raise, a move to a new state, a change in marital status, a change in hours worked can all trigger a requirement to update the IRS. The put all this information together, the government is building a vast new database. The Wall Street Journal reports:

To monitor compliance with these rules, the IRS and HHS are now building the largest personal information database the government has ever attempted. Known as the Federal Data Services Hub, the project is taking the IRS's own records (for income and employment status) and centralizing them with information from Social Security (identity), Homeland Security (citizenship), Justice (criminal history), HHS (enrollment in entitlement programs and certain medical claims data) and state governments (residency).

If the IRS debacle has dented your trust in the bureaucracy's willingness to set aside partisan politics when administering its programmes, the prospect of the Federal Data Services Hub may be troubling. "Centralizing so much personal information in one place is another invitation for the IRS wigglers in some regional office—or maybe higher up—to make political decisions about enforcement", the Wall Street Journal editorial board opines. Citing yet another new scandal, the Journal goes on to describe how new IRS powers might be used in a partisan shakedown racket:

[T]ake the recent HHS disclosure that Secretary Kathleen Sebelius has been beseeching the industries she regulates like insurers, hospitals and drug makers for "independent" donations. Ms. Sebelius will then take this money and give it to third-party groups—many affiliated with the Obama Administration—that will encourage people to sign up for ObamaCare.

The distinction between soliciting and demanding is especially vague when the IRS is the bad cop, with millions of dollars on corporate balance sheets potentially at risk. For instance, the IRS is supposed to apportion the annual $8 billion tax on health insurers according to market share—but that depends on how the IRS defines market share. Giving in advance to Ms. Sebelius can quickly begin to look like protection money to avoid corporate tax retribution.

For those sympathetic to Democrats, and inclined to diminish the significance of this week's bumper crop of scandal, it will be useful to remember that, sooner or later, these powers will be in the hands of a Republican administration.

Sara Kliff of the Washington Post maintains that the shenanigans in the Cincinnatti office of the IRS won't much affect the implementation of Obamacare, but only because congressional Republicans have already done all they can to interfere with the implementation of the new system. "At most", she writes,

the IRS is probably in for an increased amount of oversight as it moves forward on implementation of the Affordable Care Act, more questions about the data it will collect and how it will be used. Aside from that, there’s not much Congress can do to stand in the agency’s way that they have not done before.

Ms Kliff may well be right, but I fear she underestimates the imagination and cunning of the newly emboldened GOP caucus. We'll see. At the very least, the IRS scandal offers Republicans a club with which to hammer away at already weak support of Obamacare, and to resist the consolidating surge in popularity the programme's advocates hope implementation will finally bring. But to what end?

Panning way out, the invasive administrative complexity of Obamacare highlights the possibility that America's health-care system has arrived, through decades of mutual partisan sabotage, at something approximating the worst of all feasible health-care systems. I would prefer a truly free market in health care, together with generous subsidies for the uninsurable and poor. Barring that, I'd prefer a sort of Medicare-for-all socialised system. Most of us, I think, would prefer one or the other of these over what we've got. What we've got is a convoluted, hyperregulated, nightmarishly bureaucratic crony-capitalist system that lacks the virtues of either market efficiency or socialist universality. To build something like universality on top of the rotten, entrenched status quo, Americans are about to be required to report every little development in work and family life to an agency now known to abuse the trust of the citizens it is supposed to serve. A "repeal" of Obamacare might forestall the development of an overly Big-Brotherish IRS, but would leave us with yet another half-aborted layer of bureaucratic accretion, the grotesque stuff of which America's exceptionally cumbersome and unjust health-care system is made. Look upon your works, Americans, and despair.

Now and later

the economistMié, 15/05/2013 - 21:25

THE unwavering Republican line on fiscal policy is that it is unconscionable to saddle our children and grandchildren with a mountain of debt. John Boehner, the speaker of the House, repeated that mantra in January when making demands over the debt ceiling. "Without meaningful action," he said, "the debt will continue to act as an anchor on our economy, costing American jobs and endangering our children's future." America needs to keep cutting government spending, Republicans insist, to ease the "crushing burden of debt" we are bequeathing to coming generations.

Despite the now-dubious connection Mr Boehner sees between sovereign debt and rates of growth, and the surprisingly sunny news we're getting this week about the deficit, the argument has rhetorical strength. Only a gutsy, enlightened steward has the wisdom to thwart a future threat to the nation’s well-being by biting the bullet and calling for short-term pain to promote long-term gain. Only a statesman is equipped to make the tough decisions to set the country on a better course. (This argument sounds all the more appealing when taken with Republican scepticism of stimulus measures.)

But there are philosophical and empirical complexities at play in the "protect future generations!" line of reasoning. If we could avoid bigger trouble in the long run by assuming short-term hardships now, should we? Well, the answer depends on how dire things look in the long run, how much hardship is necessary to avert disaster, and how certain we are that the strategy will in fact work out in the nation’s favour. It would be irrational to opt for certain, indefinite-term pain now to purchase an unspecified amount of theoretical gain later. In any case, the moral calculation is quite a bit more involved than Mr Boehner or fellow Republicans let on. Government owes a duty to future generations, but it has a duty toward individuals living today as well: it would be perverse to aim to quell the indebtedness of Americans coming of age in 2050 by cutting food stamps for hungry children today.

In the budget authored by Paul Ryan that passed the House of Representatives in March, the word “austerity” appears only four times, and not in a positive light. Mr Ryan warned that unless America takes care of business today, it will be in for “immediate and painful fiscal adjustments” a few years down the road. He added parenthetically that the “harsh austerity” on the horizon would be reminiscent of measures that “provoked riots and a deepening recession in Greece”.

The key to preventing this turmoil, Republican leaders insist, is reining in deficits and averting a projected burgeoning of the national debt as baby boomers retire and gobble up Medicare and Social Security checks in coming decades. Mr Ryan’s sights are set squarely toward tomorrow in the final lines of his budget:

In the end, the debate about rising U.S. debt is not just about dollars and cents, but also about America’s status as a world power and its freedom to act in its own best interests. If the nation stays on its current path, the United States will be unable to afford its role as an economic and military superpower... Today’s children will grow up in a world defined by different values, and their futures will be defined by fewer opportunities than their parents had.

Last year in Foreign Affairs magazine, financial historian Niall Ferguson surveyed some of the great empire declines throughout history and observed that “most imperial falls are associated with fiscal crises. All the… cases were marked by sharp imbalances between revenues and expenditures, as well as difficulties with financing public debt. Alarm bells should be ringing loudly… [for] the United States.”

America must not abandon its leadership role in the world. For this and many other reasons, Congress must act now to change the nation’s fiscal course. The Republican House majority was sent here by the American people to get spending under control and confront these great challenges today to allow this generation to pass an even greater nation along to the next generation.

As the Wall Street Journal reports, the tide is beginning to turn a bit from prospects of a debt-fueled apocalypse. Economists of many stripes are observing that deficit hysteria in Washington may have short-circuited the recovery and on Monday, in a New York Times op-ed, David Stuckler and Sanjay Basu pointed out the human price of budget cutting in the here and now. If the House Republicans had their way, federal spending would be cut by $4.6 trillion over the next decade, with $2.7 trillion of that sum coming from cuts to health care, including the repeal of Obamacare. Mr Ryan wants to eschew "austerity" as a label for his plan—he reserves that term as a warning for what would happen if we don’t tighten our belts today—but it is unclear what would count as "austere" if trillions of dollars worth of cuts do not.

Messrs Stuckler and Basu describe the "deadly side effects" of austerity and note ominous signs of worsening health trends in America even without the slashes to health spending proposed by House Republicans:

Prescriptions for antidepressants have soared. Three-quarters of a million people (particularly out-of-work young men) have turned to binge drinking. Over five million Americans lost access to health care in the recession because they lost their jobs (and either could not afford to extend their insurance under the Cobra law or exhausted their eligibility). Preventive medical visits dropped as people delayed medical care and ended up in emergency rooms. (President Obama’s health care law expands coverage, but only gradually.)

The GOP budget never had much of a chance of becoming law, given Democratic control of the Senate and the White House. Nevertheless, the vision of massive cuts now, for redemption later, is receiving a diagnosis of hyperopia. Everyone agrees that some degree of fiscal tightening is necessary, and certainly entitlement reform is needed. But building an America unburdened by debt years down the line is not a costless endeavour. The pursuit of solvency must proceed with a clear understanding of the trade-offs between current and future generations. Thinking of the children does not spare one from considering the present needs of the hungry, sick and elderly.

(Photo credit: AFP. The young child was demonstrating with her parents against cuts to education funding in California.)

Look who's talking

the economistMié, 15/05/2013 - 18:41

WHEN the authorities want to obtain journalists’ phone records as part of an investigation into a crime, the Department of Justice’s guidelines state that their request should be “as narrowly drawn as possible”. What is more, they should try to persuade the journalists concerned to hand over the records voluntarily before getting a judge’s approval to seize them, unless doing so was likely to undermine the investigation. So it came as some surprise to the Associated Press (AP), a news agency, to discover that the Justice Department had quietly obtained records of more than 20 phone lines used by its reporters and editors in New York, Washington and Hartford, Connecticut.

AP, along with many politicians and pressure groups, condemned the seizure as unjustifiably sweeping, and thus an affront to the freedom of the press. All manner of people who might have wanted to keep their contact with AP secret will have been caught in this dragnet, the argument runs; as a result, others might now hesitate to speak to reporters, for fear that the authorities would learn of it in similar fashion. That fear is not far-fetched: under Barack Obama’s watch, the government has indicted six officials for leaking secrets under a law called the Espionage Act, which had only previously been invoked three times against government officials since its enactment in 1917.

Although the Justice Department did not explain the reason for its scrutiny of AP, it seems to relate to an article the agency published last year detailing the foiling of a plot to blow up a passenger jet en route to America. The FBI had already said it was investigating the leak of details of that operation, and another one, intended to sabotage Iran’s nuclear programme. Moreover, the telephone records at issue included the work, home and mobile numbers of journalists who had worked on the article.

Eric Holder, the attorney general, would normally have had to sign off on the subpoena of the phone records. But he did not, citing a conflict on interest, as the FBI had questioned him about the leaks as well. Instead, the task fell to his deputy, James Cole, who insists the proper procedures were followed and due consideration given to any possible impingement on press freedom. But neither he nor anyone else has given any inkling of why such a broad and secretive approach was necessary.

The administration, critics point out, is hypocritically inconsistent in its disclosure of information about national security. The president, for example, has spoken about America’s drone strikes against suspected terrorists, but in court, the administration refuses even to acknowledge the programme’s existence. By the same token, Mr Holder said the matter being investigated at AP “put the American people at risk”. Yet John Brennan, now the director of the CIA and at the time the president’s chief adviser on terrorism, told the Senate “there was never any danger to the American people” associated with the plot revealed by the AP. The Justice Department’s sudden fascination with journalists' phone records, of course, will make such inconsistencies much harder to probe.

Update: The president has asked Chuck Schumer to reintroduce a media shield law in the Senate that would offer certain protections to journalists and their sources. Mr Obama supported such a law as a senator, but has more recently expressed reservations about a similar bill.

The Richwine affair

the economistMar, 14/05/2013 - 22:36

JASON RICHWINE, a co-author of the widely trashed Heritage Foundation study on the the costs of immigration, "resigned" his post at Heritage Friday after his doctoral dissertation on immigration and IQ fell under a shadow of suspected racism. Harvard awarded Mr Richwine a PhD in 2009 for work arguing that Hispanic immigrants are less intelligent than non-Hispanic white Americans, that this gap has a genetic basis, and that immigration policy should discriminate against less intelligent groups of people, albeit under the cover of the language of "low skill" and "high skill" immigrants. Is this really racist?

Following a useful summary of Mr Richwine's thesis, Robert VerBruggen of National Review makes a plea for letting science, rather than social opprobrium, settle scientific questions:

The Left’s labeling of Richwine’s argument as “racist” is especially dangerous. In modern America it is axiomatic that “racism,” whatever it is, is wrong — and this is a good thing. It therefore is a mistake to define racism to include falsifiable hypotheses in addition to racial hatred. If Richwine’s view is racist, what are we to do if it turns out to be correct?

It's easy to sympathise with Mr VerBruggen's gist. If scientists are to ferret out even uncomfortable truths, they cannot be made to feel that they will be punished for it. Yet racism has always been predicated on falsifiable hypotheses about racial inferiority. No one has defined racism to include the assumption of hereditary racial inequality; that's simply an assumption racists tend to have. If Mr Richwine's view "turns out to be correct", what we are to do is to acknowledge that the racists were right all along—that racism has, to some extent, a valid scientific basis. People are understandably a bit touchy about this possibility. However, the subject is not fraught because "the left" has loaded it with toxic racial politics. It's fraught because the scientific validation of hereditary racial inequality would imply that there's something to be said for the racist convictions that made America's brutal history of slavery, apartheid, and colonial genocide possible. That conservatives have a tendency to minimise the savage enormities of America's racist history, to dismiss even a little interest in it as "political correctness" run amok, helps explain their related tendency to see hostility to work like Mr Richwine's as unduly politicised bullying aimed at shutting down necessary rational inquiry.

Now, I don't think the subject or conclusion of Mr Richwine's dissertation is out of the bounds of reasonable discourse. Yet I think a suspicion of racism is perfectly reasonable. Grad students can choose from an infinite array of subjects. Why choose this one? Who are especially keen to discover a rational basis for public policy that discriminates along racial lines? Racists, of course. Anyone who chooses this subject, and comes down on the side vindicating racist assumptions, volunteers to bring suspicion upon himself, to expose his work to an extraordinary level of scrutiny. Were Mr Richwine's dissertation a model of scientific rigour, he might easily enough survive this scrutiny. However, according to Daniel Drezner, a political scientist at Tufts, it's not exemplary work:

I've perused parts of Richwine's dissertation, and … well … hoo boy. Key terms are poorly defined, auxiliary assumptions abound, and the literature I'm familiar with that is cited as authoritative is, well, not good. It's therefore unsurprising that, until last week, Richwine's dissertation disappeared into the ether the moment after it was approved. According to Google Scholar, no one cited it in the four years since it appeared. Furthermore, Richwine apparently didn't convert any part of it into any kind of refereed or non-refereed publication.

When we come upon a piece of social science that is weakly researched and poorly argued, it's reasonable to suppose that the "conclusion" is actually a fixed point, a presupposition, and that the main body of the work had been contrived to support it. In this light, it's important to remember why Mr Richwine's dissertation became a subject of controversy. Mr Richwine had co-authored an abysmally rigged study with then-colleague Robert Rector that cast Hispanic immigrants as welfare leeches draining the lifeblood from the body politic.

I suspect that Mr Richwine may have been able to survive either controversy taken in isolation. Had he not just argued, in an extremely tendentious fashion, that Hispanic immigrants are, on the whole, parasites, he might have endured public criticism of his dissertation. Had he not in his dissertation argued that Hispanic immigration ought to be limited on grounds of inferior Hispanic intelligence, he would have endured the firestorm over the risible Heritage immigration study, as Mr Rector did. Taken together, however, these two works produce a strong impression of hostility to Hispanics—they're parasitical because they're a bit dim as a breed, you see—which would be very hard to dispel. It's easy to see why Heritage let Mr Richwine dangle.

Nevertheless, Mr VerBruggen, sees "a shocking unwillingness on the part of Heritage to stand up to bullying and protect the academic freedom of its researchers". Michelle Malkin says that Mr Richwine was "strung up by the p.c. lynch mob for the crime of unflinching social science research", which she finds "chilling, sickening and suicidal". This sort of indignation speaks more to the right's failure to take seriously the history and reality of American racial injustice than it does to Mr Richwine's fate. As long as conservatives are inclined to think that Mr Richwine was "bullied" and "lynched" for his brave empiricism, instead of having been sunk by the repugnant prejudice exposed by the shoddiness of his work, non-white voters will continue to flock to a party less enthusiastically receptive to the possibility of their inferiority.

In the long run, we are telepathic androids

the economistMar, 14/05/2013 - 17:03

KEVIN DRUM looks to have set the topic for the day with his article in Mother Jones on the economics of our robotic future. The argument is a good recap of several points that have also turned up in speculation by others, including Paul Krugman and my colleague, on what happens once artificial intelligence surpasses human intelligence and robots start replacing us not just in manual labour or repetitive processing tasks, but in, well, everything. Assuming Moore's Law keeps churning away at its normal exponential pace, Mr Drum figures that will happen somewhere around 2040, and it will gradually make our current economic assumptions untenable: most humans will become permanently unemployable since there will be nothing they can do that a robot can't do better and cheaper, which means there will be too few consumers to create demand for the products the robots can create. The only way out will be to vest humans at birth with ownership shares in the robot means of production, as Noah Smith has suggested, creating a post-capitalist society of hereditary aristocratic humans and robot slaves. Karl Smith agrees, but adds a moral caveat:

What’s going to happen is massive income transfers to flesh and blood human beings. These income transfers will come to be seen as a right-of-birth. This will make complete social sense once you realize that most of the beings on earth will be robots and therefore not-of-birth.

Birth is something that happens to a minority of beings who are special, flesh and blood humans.

The concern, as I see it, is over accepting the dual truth that robots will in all likelihood be sentient beings with an inner life just as ourselves, and they will live in grinding inescapable poverty.

I think both Mr Drum and Mr Smith are failing to integrate one more special factor about the artificial-intelligence revolution, though. Here's the thing about robots: they will be telepaths. When we think about intelligent entities, we instinctively model them on our own experience, where the thoughts we have take place through lightning-fast interchanges between billions of neurons inside our brains, while connections to information sources outside our skulls take place via relatively slow, dumb, evocative means like language, vision and empathy. For robots it won't be like that: information processing via electromagnetic links with the cloud will be just another form of neural connection, much as my laptop right now is actually writing this blog post on a server thousands of miles away. In fact, it's quite likely that the first entity to achieve human-like levels of intelligence will be Google, rather than some metal humanoid. We're talking the Borg, not C3P0.

As the Borg example makes clear, telepathy takes the concept of individual identity and schmears it. From that perspective, I think Mr Smith's concerns about the injustice of treating humans as persons while conscious artificial intelligences are treated as slaves is insufficiently pessimistic. The real problem with AI's is that it won't even be clear where one AI stops and another one begins. If Google were a person, what would it encompass? Would it include my docs on Google Drive? I have a couple of Google tabs open right now. Who do those tabs belong to? Me? It? Its shareholders?

Even this, though, fails to take on what may be the real long-run challenge. Brain-computer interfaces are still in their infancy, but there's no reason to suppose they won't progress just as rapidly as AI itself. By 2040, people may well be communicating directly with servers through chips implanted in their brains, which is to say they may be communicating telepathically with each other. If two servers at Google headquarters are both part of Google, what are two humans linked by a terabit-per-second direct neural link? Ten humans? A million?

I think the writer who's addressed these concerns most clearly is Charlie Stross. In "Glasshouse", for example, Stross makes it clear that in a post-Singularity society the key concern becomes the protection of individual identity, because infinite access to information tends to make everything bleed into everything else.

Our economy and our sociopolitical structure are systems of activity embedded in a physical platform. They both presume that individual persons encased in a single skull can be treated as independent actors and given rights of ownership and legal responsibilities. This hasn't always been the case; other and earlier social systems and economies often worked with families as the unit capable of owning or being held legally responsible, and our own particular current system posits a legal entity called the "corporation" which can also own things and be held responsible for actions even though it has no physical body. Our system of making individuals independent and responsible works because we train individuals to act independent and responsible. I think one of the real challenges as artificial intelligence develops is that we're going to have to look increasingly at how intelligence emerges in systems that have no clear boundaries and can't be delineated as separate persons, and our political system and our economic laws may come to seem increasingly antiquated and baroque, designed for beings that no longer exist.

(Photo credit: AFP)

The IRS errs

the economistLun, 13/05/2013 - 22:02

WHAT bigger gaffe could the Internal Revenue Service commit than to single out groups that criticised the government for greater scrutiny? Republicans, naturally enough, are outraged by the revelation that America’s taxmen consciously and explicitly did so, picking on the applications for charitable status from tea-party chapters and other right-leaning campaign outfits. Had the Obama administration desired to sow doubts about the impartiality of the federal bureaucracy and undermine confidence in America’s institutions, it would have struggled to come up with a better method.

Happily, the Obama administration does not seem to have been involved in this idiocy at all, although with its usual defensiveness, it took some time to condemn it strongly. The president names only two people to jobs at the IRS: the director and the general counsel. Until a few months ago, and throughout almost all the period at issue, the director was a Republican holdover from the administration of George Bush. Anyway, the biased investigations seem to have originated way down the chain of command, at a field office in Cincinnati. When higher-ups found out about them, they ordered the criteria for scrutiny changed—although it does seem to have taken them two years to hit upon a politically neutral formula to determine which applications to review in depth.

In all the huffing and puffing, however, two bigger scandals are being ignored. The first is the frequent abuse of America’s system of regulation of political campaigns, which the IRS, for all its incompetence, was rightly seeking to investigate. Very roughly speaking, if an organisation weighs in on a federal election campaign, it is subject to a certain set of rules, including revealing where it gets its money. (If it campaigns in coordination with a particular candidate or party, it is subject to a second, more stringent set of rules, including limits on how much it can spend.)

The applications the IRS handled so ill-advisedly were for a particular tax status—501(c)(4), in the jargon—that has become a common means to avoid these restrictions. The category is intended for organisations devoted to “social welfare”, such as community associations and economic-development groups. Those that receive it can intervene in campaigns without disclosing their donors, as long as electioneering is not their “primary activity”. Clever lawyers spotted a loophole in all this: a group that had no discernible purpose other than promoting a particular political viewpoint could still register as a 501(c)(4), as long as it was careful to spend at least half its money on campaigns that were not explicitly tied to an election. Thus Crossroads GPS, a 501(c)(4) in good standing, spends the majority of its time and money educating the public about the benefits of small government and low taxes (which can be passed off as promoting social welfare) and slightly less telling people to vote against Democrats and for Republicans (which cannot).

The IRS was at least, in however ham-fisted a fashion, trying to limit the scope for this kind of casuistry and ensure that political groups pay the taxes they owe. It should have found an ideologically neutral means to do so, beginning, perhaps, with an investigation of Organizing for America (OFA), a 501(c)(4) which evolved from Barack Obama’s re-election campaign. OFA, unsurprisingly, is energetically promoting the president’s policies and denigrating his opponents’, all in the name of social welfare.

The fact that the IRS has not found a way to stop this kind of thing is an indicator of the second scandal: the willful neglect of the taxman by politicians from both parties. The agency has 10% fewer employees than it did three years ago. Its budget has been cut three years running. It has not had a director since November. Starving the IRS is popular with voters of all stripes, but it leads to diminished revenues and thus extra debt for all Americans to bear. If those complaining about the agency’s conduct want better results, they will have to pay for them.

(Photo credit: Alamy)

"1/47"

Tom PetersLun, 13/05/2013 - 16:10
I frequently say, "I've only learned one thing 'for sure' in the 47 years since I started doing 'this stuff.'"... Tom Peters

In the long run, we'll live to 300 and work

the economistSáb, 11/05/2013 - 00:12

JOHN MAYNARD KEYNES'S contention that "in the long-run, we're all dead", is hard to dispute. Niall Ferguson, a professor of history at Harvard, raised hackles recently by suggesting that Keynes's seeming indifference to the welfare of future generations had something to do with the fact that he was childless and gay. As it happens, Keynes wasn't at all unconcerned with the long run and was actually making a point about the danger of economic theorems that encouraged governments to believe that short-run economic interventions, such as goosing the money supply during a downturn, are futile. Keynes's keen interest in futurity is on full display in his famous essay, "Economic Possibilities for our Grandchildren", in which the economic conditions of the long run is probed with great insight.

As Ezra Klein points out, Keynes was impressively prescient about the extent of future economic growth, but less so when considering how we would respond to plenitude. Keynes saw the possibility that we would simply consume more, but he speculated hopefully that we would use our wealth to enjoy meaningful leisure, and that

the love of money as a possession — as distinguished from the love of money as a means to the enjoyments and realities of life — will be recognised for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease.

That is to say, in the long run, before they're dead, our grandchildren will be gentlepersons of leisure disgusted by the work of getting and spending. Alas, we are not.

Keynes's mistake, according to Mr Klein, is that he failed to see that

Humanity’s true nature evolved around the economic problem and, with the economic problem solved, it has simply applied itself to a simulacrum of the economic problem.

In the United States, the economic problem that organizes many of our lives is not that we don’t have enough. It’s that we don’t have quite as much as those who have more. That’s an economic problem that, almost by definition, can never be solved.

Another way to put this is that scarcity is a relative notion, and thus can never be overcome. It's a good point, though I have different complaints with Keynes's forecast.

First, Keynes is too myopic about the definition of "the long run". That the living ever dwell at the frontier of time seems to encourage a fallacious sense that the hour is getting late. That the end is nigh is deep in the DNA of Christian Western culture. Friedrich Hegel and Francis Fukuyama spotted the end of history just ahead of them. "Latter Day Saints" hoard potable water and canned goods in their cellars. Environmentalists tout a sort-of pagan eschatology. Yet, for all we know, this is the morning of humanity, and the modern era of economic growth was but a light breakfast. Suppose that in 50 years a great breakthrough extends the average lifespan by hundreds of years. Our grandchildren will look upon the present age of so-called abundance as the end of the original human era, during which a terrible and absolute scarcity of time prevailed. It's really not at all clear that even the richest of us is that much less poor than our hunter-gatherer forebears. If the hour is early, it may be that we are poorly prepared to understand what it would even mean to solve "the economic problem", the problem of scarcity.

My second complaint is that Keynes's assumption about the superiority of leisured pursuits is dogmatic rather than reasoned. Though Keynes saw quite clearly that the English aristocratic class seldom made the best use of its leisure, it's hard not to see his bias against commerce and consumption as a vestige of aristocratic ideology about the inherent degradation of market activity. The idealisation of bohemian artistic and intellectual life, and the dogma of its superiority over the bourgeois commercial life, that prevailed among Keynes' Bloomsbury friends, and prevails still among artists and intellectuals, is a remarkably sturdy remnant of our feudal legacy. No doubt the persistence of economic striving has more than a little to do with humanity's deep-seated anxieties about relative position, as Mr Klein suggests. Perhaps if we felt no need to keep up with the Joneses and Mendozas and Patels, it would not be the case that so many of us sincerely like working, like earning, like buying, and find a great deal of meaning in it. Perhaps if we had no positional impulse, we'd find luxurious stretches of leisure time less intolerably enervating. Perhaps. It seems simpler and less question-begging to say that we keep on working long hours and buying lots of stuff because, whatever the ultimate cause, we take less satisfaction in the occupations of non-commercial leisure.

(Photo credit: AFP)

Come and take it

the economistJue, 09/05/2013 - 23:35

WHEN Texas was part of Mexico, and Mexico was a colony of Spain, the Spanish Mexican authorities lent a cannon to the denizens of Gonzalez, Texas, the better to thwart attacks from the area's indigenous freedom fighters. When the colonists of Texas, who were largely of colonial American origin, began here and there resisting Mexican rule, a Mexican officer requested that Gonzalez return its cannon. The people of Gonzalez refused. A different Mexican officer therefore came to Gonzalez with 100 dragoons, seeking the cannon. The Texans had too few men and arms to repel the troops, so they gave them the runaround until reinforcements could arrive. A couple days later, having managed to muster a small army, the Texans attacked the Mexicans and eventually prevailed in the first battle of the Texas Revolution. According to lore, some ladies of Gonzalez had fashioned from a wedding dress a white flag with a black star, a black cannon, and the legend "COME AND TAKE IT", and the flag was raised over the cannon of Gonzalez in defiance of the Mexicans. The "Come and Take It" flag served as a symbol of Texas backbone and independence throughout the revolution, and ever since. I saw a bumper sticker of the flag for the first time in the parking lot of a Houston Whole Foods.

Anyway, that's what I thought—"Come and Take It"—when I learned of a bill recently passed by the Texas House of Representatives forbidding state authorities from enforcing new federal gun-control laws. KVUE, an Austin-based ABC affiliate, reports:

Perhaps the most controversial of the gun-related items, HB 1076 would ban state agencies from enforcing any new federal gun laws, including background checks. The bill passed the Republican-led House on a largely party line vote Monday, but legal experts say the attempt to "nullify" possible future federal laws likely wouldn't pass the scrutiny of the U.S. Supreme Court.

"That's absurd beyond the word absurd. I like the author personally but that's just pure political grandstanding," said state Rep. Lon Burnam (D-Fort Worth).

Steve Benen, writing for Rachel Maddow's MSNBC blog, comments:

In this case, Texas' nullification bill effectively hopes to freeze the status quo of federal gun laws in place indefinitely. The state is prepared to honor federal laws as they currently exist, but if policymakers in Washington expanded current laws in any way, Texas would ignore those changes -- based on the "because I say so" theory of modern jurisprudence.

[...]

This is, of course, crazy. Whether Texas likes it or not, states can't pick and choose which federal laws they'll honor and which they'll ignore.

As my colleague pointed out in his recent post on Kansas' attempt to forbid federal agents from enforcing federal law, states can't do that. However, according to Jonathan Adler, a professor of law at Case Western Reserve University, the Texas law under consideration appears not to overreach in this way, and therefore is not best construed as an attempt at "nullification":

States, in fact, can “pick and choose which federal laws” state officials will enforce, and state refusals to enforce federal law would most definitely “withstand a legal challenge.” In fact, they already have. See, e.g. Printz v. United States in which the Supreme Court held that state officials could refuse to implement a federal background check requirement for the purchase of new firearms. Under Printz and New York v. United States it is well established that the federal government cannot force state officials to implement federal laws.

Whether or not this specific bill is a good idea, this is not a “nullification” bill. It would not prevent federal officials from enforcing federal law within the state of Texas. As described by Benen’s source, it is simply a bill that says state officials will not enforce certain federal laws — and that is something states have every right to do.

In a later post, Mr Benen graciously concedes Mr Adler's point, but seeks clarification from David Gans, the director of the Human Rights, Civil Rights, and Citizenship Program at the Constitutional Accountability Center. According to Mr Gans, the matter may not be so cut and dry as Mr Adler makes it out to be. "Even though Printz leaves state and local governments some discretion", he writes "there is a strong argument that the Supremacy Clause forbids a state from singling out a class of federal laws it disagrees with and refusing to enforce them."

Vagaries of constitutional law aside, the discretion of states to decide what federal laws they will enforce strikes me as part of a healthy division and balance of government power. Requiring that states devote its citizens' resources to the enforcement of laws with which the state legislature disagrees seems to me straightforwardly to deny the democratic sovereignty of the state's people. There ought to be a strong presumption against overruling their democratic preferences in this way. However, the parochialism of state-level democracy often fails adequately to protect the rights and interests of all its citizens in ways large majorities of the national population find deeply objectionable. In that case, it is well for federal agents to step in and enforce federal law, imposing the judgment of the larger, national democratic body, but without the added indignity of forcing the state to deploy its own resources against its own democratic judgment. It sounds to me that the law, as it now stands, strikes just this sort of balance, which is cheering. America's political system too seldom works as it ought to.

Dear life

the economistJue, 09/05/2013 - 16:08

GUN-CONTROL legislation fell short last month in a close Senate vote, but some spy flickers of hope in the "world's greatest deliberative body". However, the sense of urgency that followed the Newtown massacre has definitely faded, and new studies from the Department of Justice and the Pew Research Center showing an astonishing drop in gun violence over the past two decades seem to call into question the need for new, stricter regulations. Americans have been improving control over their many, many guns without it.

Pew reports:

Compared with 1993, the peak of U.S. gun homicides, the firearm homicide rate was 49% lower in 2010, and there were fewer deaths, even though the nation’s population grew. The victimization rate for other violent crimes with a firearm—assaults, robberies and sex crimes—was 75% lower in 2011 than in 1993. Violent non-fatal crime victimization overall (with or without a firearm) also is down markedly (72%) over two decades.

The Department of Justice recently reported similar stats. Gun-rights advocates are crowing. Charles C.W. Cooke of National Review says that the Pew and DOJ reports make "embarrassing reading for those who spend their time trying to make it appear as if America is in the middle of a gun-crime wave". Mr Cooke adds: "And those screaming '. . .but Sandy Hook!' will no doubt be pleased to know that school shootings, too, are down 33 percent since 1993".

This is all most excellent news, though I would resist the impulse to think that these welcome trends will somehow vitiate the felt need for further gun control.

The decline in gun violence is consistent with a truly amazing general decline of violence, a subject recently explored in Steven Pinker's fascinating book, "The Better Angels of our Nature". This trend defies easy explanation. Mr Pinker speculates that we have become more pacific through the gradual cultural refinement of rational capacities that have guided us away from ancient strategies of violence. One of my own pet hypotheses is that human life becomes literally more valuable to the living as we become wealthier and longer-lived. Wealthier lives have, other things equal, a better experiential texture. And as life expectancy increases, early death steals more years. So we become less likely to feel that life is disposable or cheap, and more likely to see intolerably profound loss in premature death.

Insofar as guns are seen as dangerous tools for killing, it makes sense that they would become increasingly odious to increasingly peaceful sensibilities. (And insofar as guns are seen as necessary tools of public safety and self-defence, gun control itself may seem increasingly dangerous. One's side in this debate perhaps depends more than anything on a judgment about the greater source of peril.) New demand for gun control may reflect the same shift in sensibility that has already made us less likely to use guns for violent ends. When the felt value of life increases, a small death toll can add up to a large sense of loss, and a large death toll can add up to an incomprehensible enormity. How many good hours of life were robbed from the children at Sandy Hook Elementary? Perhaps it's callous to the past to imagine that each individual life seems more valuable to us today than it did to our forebears a century ago. Still, I suspect it does. In which case, an almost-50% decrease in gun homicide may not represent quite as much progress as it at first appears. Would the 1993 rate of gun violence seem twice as intolerable today? Who knows? What I do know is that our sense of peril, our sense of what's at risk, does not track crime statistics in any simple way.

The twist in the Pew study is that Americans appear quite ignorant of these happy developments. Indeed, most Americans believe falsely that gun violence has increased. "Despite the attention to gun violence in recent months", the authors of the Pew study write, "most Americans are unaware that gun crime is markedly lower than it was two decades ago." This has some conservatives complaining of liberal "media bias", and there's probably some of that, though selection bias of the "if it bleeds, it leads" variety, and the centrality of gun violence to pop entertainments, probably has more to do with it. I'd add that the psycho-social dynamic I describe—our growing estimate of life's preciousness—might have something to do with it, too. Perhaps the salience of gun crime has increased for the same reason the danger of allowing children to walk to school alone, or to ride bicycles without shoes or helmets, has also increased in salience. Parents don't love their children any more then they used to, but they feel, probably correctly, that children now have more to lose.

In any case, general ignorance of the fall in gun violence ought to cut both ways. Once we understand how much safer we have really become, the felt need to own a gun in order to defend against guns ought to recede. Right?

(Photo credit: AFP)

A brewing fight

the economistMié, 08/05/2013 - 22:01

EARLIER this year, when a lawsuit accused Anheuser-Busch of selling watered-down beer, it caused only a minor buzz. America’s biggest breweries have long produced flavourless tipples. And anyway, those seeking a more robust brew have plenty of options. Today’s beer market increasingly resembles that of the pre-Prohibition era, when smaller, regional breweries dotted the map. Such is the demand for good-tasting beer that, on average, more than one new brewery opened every day last year.

Small and independent breweries have thrived during the recession and its aftermath, taking market share away from traditional brands like Budweiser and Miller Lite. According to Beer Marketer’s Insights, a trade publication, craft beer has grown over 13% by volume in each of the past three years. America’s two biggest brewers, Anheuser-Busch and MillerCoors, still account for around three-quarters of the domestic market, to craft’s 6.7%. But even they have noticed the change in consumer tastes. Whereas sales of their big brands have dropped off, gains have been made by offerings derisively called “crafty beer”, which look and taste like craft brews.

This has led to some debate over what constitutes a craft beer and an intra-industry squabble over taxes. The Brewers Association promotes the interests of “small, independent, and traditional” brewers that produce up to 6m barrels of beer a year. The largest craft brewer under this definition is the Boston Beer Company, maker of Samuel Adams, which produced over 2m barrels last year. That number also happens to be the cut-off for favourable treatment by the government, which gives small brewers a break on the federal excise tax.

As the craft-beer industry grows, the Brewers Association thinks more of its members will join Boston Beer on the wrong side of the tax code. So it is pushing Congress to pass a bill that would raise the excise-tax bar to 6m barrels a year. In March hundreds of small-brewery owners took their case to Congress. But the Beer Institute, which represents big and small brewers alike, unsurprisingly favours a different bill that would cut the excise tax for the whole industry.

Opponents of slashing the excise tax, which has not been adjusted since 1991, note that inflation has already reduced its potency. Moreover, some see higher alcohol taxes as a way to increase revenues. But others are sympathetic to the Beer Institute’s claim that taxes have become the most expensive ingredient of beer. Hence, perhaps, the bitter taste of some brews.

Welfare and amnesty

the economistMié, 08/05/2013 - 16:25

IN AN op-ed in the Washington Post, Jim DeMint and Robert Rector of the conservative Heritage Foundation desecrate the methods of sound social science as well as the memory of the sainted dead. On the way to touting a new Heritage study on the costs of immigration reform—a study that was immediately lambasted by the scholars of other right-leaning think tanks—Messrs Demint and Rector appeal to the authority of the late Milton Friedman (pictured). They write:

The economist Milton Friedman warned that the United States cannot have open borders and an extensive welfare state. He was right, and his reasoning extends to amnesty for the more than 11 million unlawful immigrants in this country. In addition to being unfair to those who follow the law and encouraging more unlawful immigration in the future, amnesty has a substantial price tag.

I'll get to the putative costs of amnesty in a moment. First let's set the record straight on Milton Friedman's oft-misunderstood "warning" about open borders and the welfare state. In a lecture titled "What is America?" Mr Friedman offers this thought:

[I]t is one thing to have free immigration to jobs. It is another thing to have free immigration to welfare. And you cannot have both. If you have a welfare state, if you have a state in which every resident is promised a certain minimal level of income, or a minimum level of subsistence, regardless of whether he works or not, produces it or not. Then it really is an impossible thing.

Look, for example, at the obvious, immediate, practical example of illegal Mexican immigration. Now, that Mexican immigration, over the border, is a good thing. It’s a good thing for the illegal immigrants. It’s a good thing for the United States. It’s a good thing for the citizens of the country. But, it’s only good so long as its illegal.

Please note that this is an argument in favour of large-scale illegal immigration, which is not what Messrs Demint and Rector wish to recommend. In the context of a large welfare state, Friedman favoured illegal over legal immigration because, (a) immigration to jobs is "a good thing" for everyone involved, and (b) illegal immigrants are ineligible for most forms of government transfer payments and therefore must be immigrating for jobs, which is just great. Friedman's argument here amounts to little more than the simple observation that it's infeasible to give lots of free money to anyone who shows up, because scads of people will then show up just for free money, and there won't be enough money to go around. However, in order to work as an argument against increased legal immigration, Friedman required a further, false assumption: that legal residency logically entails eligibility for free money. It doesn't.

Residency and eligibility for welfare are logically and legally separable matters, and they are for the most part legally separated. The immigration-reform legislation of 1996 explicitly barred most non-citizens from receiving most benefits, and matters remain much the same to this day. (In any case, poor resident aliens are less likely than poor American citizens to claim the benefits for which they are eligible). America, or any other country, can have relatively open borders and an extensive welfare state. What they can't have is the policy, which no one has ever actually favoured, of giving away free money to anyone who happens to reside within their country's borders. This is the policy Friedman pointlessly warned us against, and it has no real bearing on the current debate over immigration reform.

That said, even if Friedman's argument (for illegal immigration!) did not founder on a simple mistake, it still wouldn't work as an argument against offering illegal residents a path to legal residency. As far as Friedman was concerned, if those immigrants came primarily for work, and not for welfare, we should be happy to have them stick around. If the possibility of a future amnesty sweetens the prospect of illegal immigration for other hard-working foreigners, all the better.

Now, it's quite clear that Messrs Rector and DeMint disagree fundamentally with Mr Friedman on the merits of relatively free immigration. They deny that that those who have illegally immigrated to find jobs are "a good thing" for America, and they argue that providing those residents a path to citizens will exact a terrible price:

Already, illegal immigrants impose costs on police, hospitals, schools and other services. Putting them on a path to citizenship means that within a few years, they will qualify for the full panoply of government programs: more than 80 means-tested welfare programs, as well as Social Security, Medicare and Obamacare. The lifetime fiscal cost (benefits received minus taxes paid) for the average unlawful immigrant after amnesty would be around $590,000. Who is going to pay that tab?

It is for this estimate, among others, that Mr Rector and Jason Richwine, his co-author on the Heritage study, have been flayed. Messrs Rector and Richwine fail entirely to take into account the larger dynamic consequences immigration reform. Tim Kane, an economist formerly of the Heritage Foundation, complains that "The authors estimate fiscal benefits only (and weakly), but ignore economic benefits entirely". He goes on to add that:

Millions of migrants cannot help but add to the GDP, and more importantly to specialization and growth. Dynamically, there are at least two huge channels of positive feedback into the productive side of U.S. economy—think of less expensive farm produce and greater demand for housing.

As Shikha Dalmia, writing for Bloomberg, noted last month:

State-level studies that have taken both [fiscal and dynamic economic effects] into account consistently find that the economic contributions of these immigrants dwarf their fiscal costs. A 2006 analysis by the Texas comptroller estimated that low-skilled unauthorized workers cost the state treasury $504 million more than they paid in taxes in 2005. Without them, however, the state’s economy would have shrunk by 2.1 percent, or $17.7 billion, as the competitive edge of Texas businesses diminished.

Likewise, a 2006 study by the Kenan Institute at the University of North Carolina found that although Hispanic immigrants imposed a net $61 million cost on the state budget, they contributed $9 billion to the gross state product.

A similar result seems likely to hold for the country as a whole. Alex Nowrasteh of the Cato Institute cites a recent paper by Raul Hinojosa-Ojeda, a political scientist at UCLA, which uses a dynamic model to estimate that "immigration reform would increase U.S. GDP by $1.5 trillion in the ten years after enactment", and that the effect of implementing the policy currently favoured by Heritage would lead to "a $2.6 trillion decrease in estimated GDP growth over the next decade".

My guess is that these estimates are too high, but neither Milton Friedman nor the authors of the Heritage study offers a serious reason to doubt that the economic benefits of immigration reform will far outweigh the costs.

(Photo credit: AFP)

Piggy Sue!

Tom PetersMié, 08/05/2013 - 13:57
The two great folks who are doing sustainable farming at our place have become parents. Well, not really. But their... Tom Peters

The matter with Kansas

the economistMar, 07/05/2013 - 19:41

LET'S say you consider America's federal gun-control laws to be uniquely dangerous instruments of government oppression. You think the second amendment gives citizens the right to buy, carry, transport and sell pretty much any weapon they like. What do you do? If you’re a Kansas state legislator, you and your governor decide to enact the Second Amendment Protection Act:

Any act, law, treaty, order, rule or regulation of the government of the United States which violates the second amendment to the constitution of the United States is null, void and unenforceable in the state of Kansas.

One might wonder why the second amendment needs protecting by Kansas's politicians. The Supreme Court has been defending it robustly in recent years, with two cases giving wide scope to individual gun-ownership rights. But Kansans insist on more: exempting themselves from laws like the Gun Free School Zones Act and the Protection of Lawful Commerce in Arms Act. And there’s more: S.B. No. 102 makes it a felony for federal agents to attempt to do their job within the state of Kansas:

It is unlawful for any official, agent or employee of the government of the United States, or employee of a corporation providing services to the government of the United States to enforce or attempt to enforce any act, law, treaty, order, rule or regulation of the government of the United States regarding a firearm, a firearm accessory, or ammunition that is manufactured commercially or privately and owned in the state of Kansas and that remains within the borders of Kansas.

That’s right: it is now a crime for a federal officer to enforce federal law in Kansas.

How can the trapezoidal midwestern state do this? Well, it can’t, and Attorney-General Eric Holder has the unenviable job of explaining why. In a letter to Sam Brownback, the governor of Kansas, Mr Holder was all business:

In purporting to override federal law and to criminalise the official acts of federal officers, SB102 directly conflicts with federal law and is therefore unconstitutional.

Under the Supremacy Clause…Kansas may not prevent federal employees and officials from carrying out their official responsibilities. And a state certainly may not criminalise the exercise of federal responsibilities. Because SB102 conflicts with federal firearms laws and regulations, federal law supercedes this new statute; all provisions of federal laws and their implementing regulations therefore continue to apply.

It is remarkable that a civics lesson like this is necessary. But Kansas has actually raised the stakes. Mr Brownback launched a defiant response to Mr Holder’s letter (“the people of Kansas have expressed their sovereign will”, he wrote, and the attorney-general’s perspective is merely “the view of the Obama administration”) and dozens of other states have considered similar legislation. A teachable moment presents itself.

The technical term to describe Kansas’s legislative move is “nullification”. Before the civil war, several states worried the federal government was encroaching on their sovereignty and threatening to regulate slavery against their wishes. After John Calhoun claimed the power of South Carolina to nullify a federal tariff in 1830, President Andrew Jackson was not amused. “The Constitution of the United States...forms a government, not a league”, he wrote. Rejecting a federal law will “destroy the unity of a nation.” In the tome from which this blog borrows its name, Alexis de Tocqueville put it this way: “when the majority has once spoken, it is the duty of the minority to submit.” The civil war put an end to southern nullification efforts, but the idea sprang up again when several states registered intransigent opposition to school desegregation efforts in the 1950s. The Supreme Court unanimously rebuffed legislation to undermine the Brown v Board of Education decision, reminding Arkansas that the constitution is the supreme law of the land and that the court, as per Marbury v Madison, has the final word on what the constitution means.

But legislators in Kansas insist that their interpretation of the second amendment must not be trifled with. Pointing to the guarantees of the ninth and tenth amendments, as well as the second, the Kansas law insists on defending the right to bear arms “as that right was understood at the time that Kansas was admitted to statehood in 1861, and the guaranty of that right is a matter of contract between the state and people of Kansas and the United States...” The legislation is silent on the historical matter of how the second amendment was regarded a century and a half ago; the emphasis, despite this disingenuous social-contract framing, is on how Kansans view that right in 2013. That much is clear. What is less clear is how the people of Kansas think the American story will continue to be written if all 50 states are empowered to ignore federal laws and punish federal agents who try to carry them out.

Páginas

Suscribirse a bitacorarh agregador