Today's Tabbloid: The Brown Revolution (Cato at Liberty)

20 January 2010
Today’s Tabbloid
PERSONAL NEWS FOR lgn@limitedgovernmentnetwork.com
FISCALLY CONSERVATIVE BLOG FEEDS 35 points. All 10 of its House members are Democrats, and about 90
percent of both legislative chambers. That’s a well-entrenched political
The Brown Revolution [Cato at establishment. And as so often happens with long-ruling parties, it has
seen its share of corruption: Three consecutive House speakers have
Liberty] resigned under clouds. It’s no surprise that Massachusetts Democrats
JAN 19, 2010 09:25P.M. have finally encountered the kind of voter reaction that national
Democrats did in 1994, and national Republicans in 2006 and 2008.
By David Boaz
Given President Obama’s falling job approval, growing opposition to the
Obama health care plan, the recent elections in Virginia and New Jersey,
the fury in Nebraska over Ben Nelson’s wheeling and dealing, the
growing recognition that libertarians are a major part of the
decentralized “Tea Party” movement, and rising poll support for “smaller
government,” the Brown victory is a flashing red light with a siren
warning Democrats not to proceed with a health care bill that voters
don’t like and a big-government agenda that Americans weren’t voting
for in 2008.
Brown is no libertarian. But he campaigned against the Obama-Reid-

Pelosi health care plan and against tax increases, so he will be part of the
opposition to the current governing agenda. And he stood up to
challenge the Democratic machine when no one else did. And certainly
events in Georgia, Ukraine, and elsewhere are sufficient reminder that
the failings of individuals don’t invalidate the popular movement.
Around the world over the past decade, longstanding and stultifying How does an entrenched political party respond to a successful
power elites have been toppled by what came to be known as the “color rebellion? Well, one way is for both the local and national officials to
revolutions” — notably the Rose Revolution in Georgia, the Orange refuse to certify the results of the election and try to ram unpopular
Revolution in Ukraine, and hopefully the Green Revolution in Iran. Now programs with the votes of rejected legislators. Would Democrats try to
the political elites in Boston and Washington have been rocked by the do that with more elections looming in just 10 months? Harry Reid and
Brown Revolution. Barney Frank say absolutely not. Expect a lot of scrambling this week.
Pundits have been describing a possible Brown victory in terms like

“canary in the mine,” “depth charge,” “shock waves,” “nuclear
explosion,” “full freak-out,” and “angels will weep and the Charles River
will run red with blood.” Political scientist Raymond La Raja said a
Democratic loss would be the first shot in what could be a revolutionary
war – ”like the Battle of Lexington and Concord.” That’s what worries the
Democratic ruling establishment.
This “revolutionary” video got more than 400,000 views in the week
before the election.
Scott Brown takes over a seat in the United States Senate that has been
held by one family (including its seat-fillers) for just over 57 years, since
John F. Kennedy was elected to it in 1952, before Brown was born.
Massachusetts hadn’t elected a Republican senator since 1972. In the
closest U.S. Senate race of the past decade, Democrat John Kerry won by
1
Today’s Tabbloid PERSONAL NEWS FOR lgn@limitedgovernmentnetwork.com 20 January 2010
FISCALLY CONSERVATIVE BLOG FEEDS schools since most of the charter-supply problem revolves around over-
regulation and painful authorization processes. And while states have
Tuesday Links [Cato at Liberty] eliminated prohibitions on using student test results to evaluate
JAN 19, 2010 04:02P.M. teachers, they haven’t done much to actually base teacher evaluations on
student performance or other meaningful metrics.
By Chris Moody
What has RttT done that is of substance? Unfortunately, push yet more
• Gene Healy on today’s election in Massachusetts: “If Republican power into federal hands, forcing states and districts to jump through
Scott Brown wins the Massachusetts special election Tuesday, the all manner of hoops for a chance to get back some of their citizens’
Bay State will have its first GOP senator since the era when disco money. Indeed, it is becoming painfully clear that President
was king. And Brown will have the much-derided Tea Party legions Obama intends to put Washington firmly above the states in the
to thank.” hierarchy of education power.
• Why opportunistic politicians need to stop using times of crisis for For his $1.35 billion RttT expansion, President Obama plans to allow
their own ends and let the next one go to waste. districts to directly compete for federal funding, bypassing states
completely. And then there’s his crusade for national
• George W. Obama? “Bush’s successor—who actually taught curricular standards. His administration has been talking up “common”
constitutional law at the University of Chicago—is continuing much standards since almost day one, and in the ”fact sheet“ accompanying the
of the Bush-Cheney parallel government and, in some cases, is RttT expansion announcement the first bullet states that RttT
going much further in disregarding our laws and the international emphasizes “designing and implementing rigorous standards and high-
treaties we’ve signed.” quality assessments, by encouraging states to work jointly toward a
system of common academic standards.”
• Can Google beat China? Cato’s Timothy B. Lee tackles the question
in The New York Times Online. Don’t be fooled, by the way, by the “states” working “jointly” thing, or
utterly unbelievable administration denials. If the feds are paying states
• Podcast: “Our America Initiative” featuring former New Mexico to adopt common standards then those standards will be de facto
Governor Gary Johnson. Johnson discusses out of control federal. Either that, or the feds will let states adopt any old joint
government spending, immigration, the Bush years, the drug war, standards and still get paid. Six of one bad thing, half dozen of the
defense policy and more. other…
Thankfully, there is resistance to Obama’s bribe-to-the-top scheme.

Texas, most notably, has refused to participate in RttT, with Gov. Rick
FISCALLY CONSERVATIVE BLOG FEEDS Perry declaring that ”we would be foolish and irresponsible to place our
children’s future in the hands of unelected bureaucrats and special
Race to Domination [Cato at interest groups thousands of miles away in Washington.” And Texas is
not alone: According to a New York Times article appearing yesterday,
Liberty] states and districts around the country are refusing to put on their track
JAN 19, 2010 03:59P.M. shoes and run for the federal funds.
By Neal McCluskey Still, federal money — taxpayer money — can be a tough thing for any
elected offical to turn down. Sooner or later, if we let him, Obama will
Today’s the day that states must submit their applications to the U.S. almost certainly find an amount that no state or district can resist.
Department of Education to compete for round-one “Race to the Top”
grants. But no worries if your state’s a little behind: Not only will there
be another application round for the $4.35-billion dash-for-cash, but as
President Obama announced today, he wants a $1.35-billion sequel
to what was supposed to be a one-time, stimulus-funded contest.
The important question, of course, is whether sponsoring this race is

worthwhile for federal taxpayers. The clear answer is no.
Sure, in response to RttT states have been raising charter-school

caps, allowing teachers to be evaluated using student performance, and
instituting other changes, but they’ve done little of real substance. Just
raising caps won’t make it much easier to get good, competitive charter
2
FISCALLY CONSERVATIVE BLOG FEEDS FISCALLY CONSERVATIVE BLOG FEEDS
Take Action: Tell Your Senators Special Election Edition of

to Reject the Conrad/Gregg Kudlow Report Tonight [Larry
Commission Proposal Kudlow’s Money Politic$]
JAN 19, 2010 11:39A.M.
[Americans for Tax Reform]
JAN 19, 2010 02:22P.M.
The following is cross-posted at www.fiscalaccountability.org: The

Senate is back in session this week, and will be voting on the
Conrad/Gregg bipartisan tax and spending “reform” commissio...
FISCALLY CONSERVATIVE BLOG FEEDS

This evening at 7pm ET:
Senate Urged to Keep Card SHOWDOWN IN MASSACHUSETTS
Check Out of Jobs Bill NBC’s Kelly O’Donnell will join us live from Boston.
[Americans for Tax Reform] WHAT’S THE MESSAGE MASSACHUSETTS IS SENDING?

JAN 19, 2010 01:43P.M.
Panel:
The Alliance for Worker Freedom sent the following letter to all Senators
urging them to reject any rumored “card check” provisions should they
*Peter Beinart, Prof of Journalism & Political Science, City University of
be included in a “Jobs Bill.” AWF&n..;.
New York; New America Foundation Sr. Fellow ; Sr Political Writer,
Daily Beast
*Steve Moore , Senior Economics Writer for the Wall Street Journal
Editorial Boar ; “The End of Prosperity” Co-Author
*Robert Tracinski, editor of The Intellectual Activist and TIADaily.com
Obama’s First Year: $2 Trillion CAN SCOTT BROWN STOP THE BIG GOV’T TAX TIDE?
in New, Proposed Taxes Sen. Judd Gregg (R-NH) will join us from Washington.
[Americans for Tax Reform] MASS RACE IMPACT ON STOCKS
JAN 19, 2010 11:51A.M.
Panel:
We often get the question at ATR, “how much has Obama supported in
new taxes?” This new study seeks to answer that question. For the first
*Brian Gardner, Sr VP, Washington Research for Keefe, Bruyette &
time ever, the tax increases signed into law...
Woods
*Don Luskin, CNBC Contributor/Trend Macro Chief Investment Officer
*John Carney, Clusterstock
MASS SHOWDOWN LATEST

Suffolk pollster David Paleologos, will join us live from Boston with a
look at all the latest election developments.
Please join us. The Kudlow Report. 7pm ET. CNBC.
3
FISCALLY CONSERVATIVE BLOG FEEDS definitional problem in the context of what components of
Iran’s industrial infrastructure are included in this nuclear
The Hopelessly Stupid Politics weapons program and which of them are kept outside of it.
From my reading of the news reporting I think that it has
of the Iran NIE [Cato at Liberty] been at least mildly misleading.
JAN 19, 2010 11:09A.M.
Predictably, American neoconservatives began rending their garments
By Justin Logan and gnashing their teeth, whipping each other into a frenzy, decrying the
“politicized intelligence” at the CIA (do they ever tire of that?). But really,
The Washington policy establishment is now pulsing with excitement is it too much to ask of journalists who write about national security
over news that the intelligence community (IC) is revising its 2007 (and, to be fair, their headline writers) to read one footnote in a
statement that “We judge with high confidence that in fall 2003, Tehran document that contains about three pages of text? I’m not the smartest
halted its nuclear weapons program1; we also assess with moderate-to- guy in the world, and I managed to figure out what the deal was while in
high confidence that Tehran at a minimum is keeping open the option to a big time crunch, without access to the full document, and without a
develop nuclear weapons” and that this halt “lasted at least several sizeable rolodex of insiders I could call to help me figure out what was
years.” going on. Still, the American journalistic community splashed headlines
like “NIE: Iran halted nuclear weapons program in 2003″ and such. So
Funny story: The day the NIE came out, Ted Carpenter and I were in a sense, the neocons were right: the inferences people drew from
arriving in Los Angeles to give at talk at the LA World Affairs Council on reading the reporting on the NIE were inaccurate.
Iran. Immediately on our deplaning, the questions started coming:
“What do you think about the NIE? How does this change things?” But this is, more than anything, a critique of the American journalistic
“What NIE?” I asked. establishment than it is the IC. Writing in the first sentence of a three-
page document a provocative claim and then footnoting a definition that
So amid our last minute preparations for the talk, I was scrambling to get dramatically alters the implications of the claim is not really all that
hold of a copy, but being the Luddite I am, I couldn’t manage to get my tricky. The people who assemble news stories, who did not exactly cover
computer to work, or to get the .pdf to open right on my Blackberry. But themselves in glory in scrutinizing government claims before the war in
I was ultimately able to pull up the first sentence, quoted above, and to Iraq, were either lazy or stupid in this case as well. Given the benefits the
look at the first footnote. neocons reaped from the media’s laziness or stupidity in the Iraq case,
the spluttering outrage in this case was always a bit much to take.
That was all anybody needed to do. The footnote read:
For the purposes of this Estimate, by “nuclear weapons

program” we mean Iran’s nuclear weapon design and FISCALLY CONSERVATIVE BLOG FEEDS
weaponization work and covert uranium conversion-related
and uranium enrichment-related work; we do not mean In Case This Needs Saying: It’s a
Iran’s declared civil work related to uranium conversion and
enrichment. Tax [Cato at Liberty]
JAN 19, 2010 11:06A.M.
Well, this is like saying Iraq had weapons of mass destruction because we
found a few degraded mustard gas shells out in the middle of the desert. By Jim Harper
That wasn’t what anybody was referring to when “Iraq’s weapons of mass
destruction” were a topic of conversation, so it proves only that if you Last week, President Obama unveiled a plan for something he
redefine things you can change conclusions. Much of the nuclear called a ”Financial Crisis Responsibility Fee,” to be fleshed out in his
infrastructure that is in dispute in Iran is contained in “civil work related forthcoming budget proposal. He will seek to have some set of financial
to uranium conversion and enrichment,” so the new definition does not services providers pay money to the government as comeuppance for the
include much of what people speaking in the vernacular are including recent financial crisis and government involvement in trying to remedy
when they say “Iran’s nuclear program.” So at the talk that night in LA, I it.
said this:
The naming of the “Financial Crisis Responsibility Fee” is a fairly
the headline splashed all over the newspapers with respect to conspicuous attempt to avoid calling it a tax. (My colleague David Boaz
the National Intelligence Estimate (NIE) is that Iran in 2003 points out the sheer number of taxes the Obama administration and its
suspended, and kept in suspense, its nuclear weapons allies are considering.) But it’s fairly clear that this thing is, indeed, a tax.
program; however, it continues to operate facilities like that
at Natanz which could at some point in the future be used as The galaxy of government revenues has a number of different
part of a nuclear weapons program. So it really becomes a planets—taxes, fees, penalties, and a few others. If they’re well
4
constructed, fees are generally favored because the recipients of services FISCALLY CONSERVATIVE BLOG FEEDS
or benefits pay their costs. Fees avoid redistribution of wealth (either
toward or away from payers). But this doesn’t mean that you can name Tuesday’s Daily News [The Club
any payment to the government a ”fee” and produce fair and appropriate
results. for Growth]
JAN 19, 2010 11:06A.M.
When I worked on Capitol Hill, I was tasked with writing a bill to deny
federal agencies the power to raise taxes, requiring them to be approved Here are the front pages of today s stray dogs.
by Congress. (You’d think that only Congress should set or raise taxes,
right? Sorry to disappoint.) The goal was not to draw fee-setting into the
ambit of the bill.
After extensive reasearch into the dividing line between fees and taxes,
which is not as simple as one might imagine, I produced the following Scott Brown’s Great Tax-Cut
definition, as found in the Taxpayer’s Defense Act (introduced in the
House during the 105th Congress, and the House and Senate in the Message [Larry Kudlow’s
106th Congress):
Money Politic$]
[T]he term “tax” means a non-penal, mandatory payment of JAN 19, 2010 10:43A.M.
money or its equivalent to the extent such payment does not
compensate the Federal Government or other payee for a
specific benefit conferred directly on the payer.
Parsing it briefly: A penalty is not a tax. A voluntary payment is not a tax.

Both payments of money and tranfers of value not denominated in
dollars can be taxes. A payment that compensates a benefit conferred is
not a tax, but the part of a payment going above the benefit conferred is.
Non-tax payments are for a specific benefit conferred directly on the
payer, not benefits conferred on regulated entities generally or on the
country as a whole. (Though this isn’t specified in the definition, being
regulated isn’t a benefit.)
With even the New York Times referring to President Obama’s

“Financial Crisis Responsibility Fee” as a “tax,” there doesn’t seem to be I know there have been a million blog posts about the Scott Brown race
much chance of that the administration will get the “fee” label to stick. for the Senate. But I want to add a couple of points to the discussion.
But, just in case, here’s confirmation: It’s a tax.
When I interviewed Scott two weeks ago on CNBC, before any polls were
out, what struck me about him was his breathtakingly clear message: low
marginal tax rates, as per President John F. Kennedy, who was the first
post-WWII supply-side president. There also was the pledge to vote
against Obamacare, but it was so interesting to me that Scott touted the
JFK tax cuts — a) because it was a Democratic tax-cut message and b)
because the Ted Kennedy Democrats in Massachusetts and nationwide
not only abandoned the JFK supply-side-growth message, they actively
opposed it.
So here is Scott Brown appealing to tea-party Democrats, independents,

and Republicans, principally by touting the last across-the-board
Democratic tax-cut plan.
There are many other successful Scott Brown messages in play, including
the terrorist message and the Obamacare message. But this tax-cut
message — i.e., reducing marginal tax rates across-the-board for all
taxpayers — really interests me as a great message.
5
Democrats aren’t the only ones who have lost this message. To a large with their taxes — including proof of residency, a signed
extent, so has the GOP. And today, just as during the Reagan years, and mortgage statement and drivers license — which the e-file
reaching all the way back to JFK, the bipartisan allure of this supply-side system is not equipped to handle.
message has virtually been lost in the discussion of the Massachusetts
election. The original homebuyer tax credit, which became available in April
2008, generated a nightmare of fraud. In one case, the credit was
Pundits are missing it, and so are the Republican congressional leaders. claimed by a four-year-old. Even IRS employees filed “illegal or
If Republicans want Democrats and independents to come back to their inappropriate” claims for the credit. As a result, when Congress extended
side, they should think about the fairest pro-growth message of them all: and expanded the credit in November, the IRS began requiring extra
lower tax rates for everybody. Get out of the box of rich people and class documentation.
warfare. For Democrats, that box has been a loser. But for timid
Republicans always on the defensive, that box is a loser, too. Thus, micromanagement through the tax code is a bureaucratic Catch-
22. If the IRS streamlines the paperwork, tax breaks get riddled with
Reagan knew this, and that is why he touted JFK’s across-the-board tax fraud and abuse. If it tries to cut down on the fraud and abuse, taxpayers
cuts. and federal workers get bogged down in a pile of wasteful paperwork.
The solution to the problem is for the government to get out of the social
engineering business. Federal attempts to foster homeownership are a
FISCALLY CONSERVATIVE BLOG FEEDS perfect example of why such attempted engineering can ultimately cause
more harm than good. The homebuyer tax credit should be allowed to
Homebuyer Tax Credit expire at the end of April, and the federal tax subsidies for
homeownership should be ended.
Complications [Cato at Liberty]
JAN 19, 2010 09:14A.M.
By Tad DeHaven FISCALLY CONSERVATIVE BLOG FEEDS
Most people would agree with Chris Edwards that the federal tax code is Vermont’s Education Spending
insanely complicated. The IRS Commissioner doesn’t do his own taxes,
the Treasury secretary and other Washington policy experts haven’t paid [Cato at Liberty]
what is owed, and the already overwhelmed IRS would be given an JAN 19, 2010 08:38A.M.
expanded role under the Democrat’s health care legislation.
By Chris Edwards
A key problem is that the social engineers on Capitol Hill have run amok.
Recently, they have been enamored with home-buying tax credits, and I happened to catch the January 7 State of the State speech by Gov.
CNN.com notes how it is further overwhelming the IRS bureaucracy: Jim Douglas of Vermont on C-SPAN. It was a sober and serious
presentation that laid out the facts about higher taxes and excessive
On Thursday, CNNMoney revealed that buyers who spending, which are problems in just about every state.
purchased their properties after Nov. 6 were unable to claim
the refund because the Internal Revenue Service had yet to Douglas on excessive education staffing Vermont:
release a new form and instructions. But on Friday, the IRS
finally posted the new form 5405. Since 1997, school staffing levels have increased by 23
percent, while our student population has decreased by 11.5
Claiming the credit now requires sending paperwork to the IRS — no e- percent. The number of teacher’s aides has gone up 43
filing allowed: percent. The number of support staff has gone up 48 percent.
For every four fewer students a new teacher, teacher’s aide or
And these new buyers can no longer file electronically. They staff person was hired. There are 11 students for every teacher
have to mail in paper forms, including the new 5405, whether – the lowest ratio in the country – and a staggering five
they are amending their 2008 taxes or claiming it on the students for every adult in our schools. With personnel costs
2009 taxes that are being filed this spring. That is going to accounting for 80 percent of total school spending, it’s no
dramatically slow refunds, but taxpayers can’t blame the IRS. wonder that our K-12 system is among the most expensive in
Instead, it’s people scamming the system who are at fault. For the nation at $14,000 per student per year.
example, in October tax preparer James Otto Price III was
the first person convicted of this crime. He falsely claimed the Current staffing and compensation levels cannot be
credit for 15 clients. So buyers must now file documentation maintained as the student count continues to decline. If we
6
simply move from our current 11 to 1 student/teacher ratio to

13 to 1, we would still have one of the lowest ratios in the FISCALLY CONSERVATIVE BLOG FEEDS
country, while saving as much as $100 million. If we want to
make education costs sustainable, we must return balance to Scholars Debate
classrooms. I propose that over four years we bring our
statewide student/teacher ratio to affordable levels. Constitutionality of Insurance
Douglas on excessive education bureaucracy: Mandate [Tax Foundation]
JAN 19, 2010 12:00A.M.
Our school governance structures are a vestige of the 19th
century and, like our unsustainable personnel costs, must be Over on NPR, scholars debate whether the proposed health insurance
reformed. We have 290 separate school districts –- one for mandate would be constitutional:
every 312 students –- 63 different supervisory bodies and a
State Board of Education. That’s a total of 354 different [Florida Attorney General Bill] McCollum wrote fellow state attorneys
education governing bodies for a state with only 251 towns. general and urged them to explore a constitutional challenge.
Douglas on education financing: “I’m assuming there will be a bill that becomes law, and … if it does
include a individual mandate, or what I call a living tax, then at that
At the root of our education funding challenge is a system point we have to make a decision: Do we challenge it in court?” he said.
that’s substantially eroding local control. Each year the “The first step would be to go into federal court and seek that challenge,
connection between your school budget vote and your and I would expect, if that were to be the case, we’d have a sizeable
property tax bill becomes more and more distant. . . our number of attorneys general joining us.”
education funding regime has grown into an unmanageable
maze of exemptions, deductions, prebates, rebates, cost-shifts A legal battle could end up in the Supreme Court. Georgetown University
and hidden funding sources. Overlapping rings of complexity law professor Randy Barnett is already gearing up for that. He maintains
keep all but a few experts from understanding the many Congress would be overstepping its powers enumerated in the
moving pieces. This is not good tax policy, not good Constitution if it required people to buy health insurance.
government, and, if you ask most Vermonters, not good for
much of anything. It’s time to pull back the curtains and let “Never in the history of the United States has the federal government
the sun shine in on how education is funded. Transparency – ever required someone to engage in an economic activity with a private
Who is paying? What are we paying for? What are the party. It’s never been done, and anything that’s never been done before
results? has no precedent for it,” he said. “It would have to be a new decision by
the Supreme Court to uphold this new extension of power. And if they
Douglas on excessive education regulations: uphold this, then there’s pretty much nothing that Congress can’t do and
that’s the end of the enumerated power scheme.”
Currently, Vermont schools are prohibited by law from
accessing out-of-state distance learning programs … If a But William Treanor, the dean of Fordham University’s law school, said
school sought to provide a new Chinese program for this he’s confident an individual mandate would be held constitutional if it
student, or even a group of students, they would have to hire went to the Supreme Court.
a new teacher with the expertise – a costly step. Allowing
students to access approved distance learning programs from The rest, including other opinions, here. Since the insurance mandate
around the country is a simple, affordable change we can would be unprecedented in its scope and applicability, precedent is not
make to improve quality. much of a guide. My guess is that most scholars think that the courts are
so deferential that they’ll sign off on any legislative scheme cloaked in
Excessive staffing, complex bureaucracy, complex financing, and interstate commerce justifications. I don’t think that’s the case.
excessive regulation are problems in government education systems
across the country. There is no better time than today, when states have Related: Constitutionality of Proposed Bank Tax
large budget gaps, to tackle these chronic problems.
So kudos to Douglas. His speech was a contrast to that of

Colorado’s Gov. Bill Ritter, who followed him on C-SPAN
uttering the usual lofty but vacuous speech we expect of most
politicians.
7
FISCALLY CONSERVATIVE BLOG FEEDS FISCALLY CONSERVATIVE BLOG FEEDS
A Remarkable Story - Trapped Racial Politics and the Supreme

for Six Days in Haiti [Reason Court [Cato at Liberty]
JAN 18, 2010 02:38P.M.
TV]
JAN 19, 2010 12:00A.M. By David Boaz
Amazing story and great reporting. Lauren Collins has a long and interesting profile of Justice Sonia
Sotomayor in the January 11 New Yorker. It’s full of heartwarming
stories about her hard-working parents, her dedication to education, her
warmth to friends and law clerks, and so on. Though it does include this
vignette that seems to corroborate controversial claims that she was “a
bully on the bench”:
In early December, during oral arguments for United Student
The Snowe Non-Option [Cato at Aid Funds Inc. v. Espinosa, Sotomayor cut off a lawyer as he
attempted to answer a question posed by Justice Ginsburg.
Liberty] “Counsel, may I interrupt for just one moment, because
JAN 18, 2010 10:41P.M. I—there is something needling at me that I do need an
answer to,” Sotomayor said. According to Law.com, which
By Michael F. Cannon reported on the incident in a story headlined “Sotomayor
Collides with Ginsburg During Questioning,” Justice Stephen
Jonathan Chait thinks that if Scott Brown becomes the 41st vote against Breyer turned to Sotomayor as though to intervene. Before he
President Obama’s health plan, supporters could “Go back to Olympia could, Ginsburg shot back, “And I’d like him to answer the
Snowe” to secure the necessary 60th vote. After all, “Her substantive question that I asked him first.”
demands have been met.”
But what really struck me in the article, and what appears to be new
Perhaps Chait forgets that Sen. Snowe (R-ME) — along with Sen. Susan reporting, was this discussion of the explicitly racial politics that led up
Collins (R-ME), and every other Senate Republican — voted to declare an to her nomination. Maybe I’m just naive, and certainly I wasn’t under the
individual mandate unconstitutional. During the floor debate, Sen. John impression that race, religion, gender, and other such factors are absent
Ensign (R-NV) took the unusual step of raising a constitutional point of in the selection of our nine most trusted judges. But this really seems like
order against the bill’s individual mandate. According to the presiding the way you put together a balanced ticket in a political campaign, not
officer: the way you choose a wise justice:
The question is on agreeing to the constitutional point of Latino leaders began laying the groundwork for a Sotomayor
order made by the Senator from Nevada, Mr. ENSIGN, that nomination almost as soon as President Obama was elected.
the amendment violates Article I, Section 8 of the During the Administrations of George H. W. Bush and Bill
Constitution, and the Fifth Amendment. Clinton, Latino groups had repeatedly failed to coalesce
around a candidate. This time, they were determined to wield
Snowe’s “aye” vote makes it hard for her to support any bill that includes their influence as a bloc. In January, Nydia Velázquez, the
an individual mandate. If she were to vote for an individual mandate Democratic congresswoman from New York’s Twelfth
after declaring that such a law would violate the Constitution, Snowe District, was sworn in as the head of the Congressional
could reasonably be accused of violating the oath she swore to the Hispanic Caucus. She asked Sotomayor, a longtime friend, to
Constitution upon joining the Senate. come to Washington to administer the oath—and to insure
that she was fresh in the mind of every Hispanic member of
Yet Democrats are unlikely to support any bill that does not include an Congress.
individual mandate. As President Obama told a joint session of Congress,
his plan “only works” if lawmakers force everyone to purchase At a Cinco de Mayo party at the White House, Velázquez and
government-designed health insurance. Serrano, who is of Puerto Rican descent, each buttonholed
Obama.
“Mr. President, she’s a very qualified person, and it would be

a historic nomination,” Serrano said.
8
Velázquez gripped Obama by both hands. “Mr. President, you FISCALLY CONSERVATIVE BLOG FEEDS
have an opportunity, here in your hands, to shape the United
States Supreme Court for years to come.” Democrats’ Voracious Search
Obama whispered into Velázquez’s ear and smiled. “I for New Tax Revenue [Cato at
know—there’s a Puerto Rican woman.”
Liberty]
Justice David Souter announced his resignation on May 1st. JAN 18, 2010 10:28A.M.
Not long afterward, the Hispanic Caucus convened to
formally endorse a candidate. The meeting was long and By David Boaz
contentious. The Mexican-Americans did not have a superior
candidate. The Puerto Ricans did not have the numbers. After Last year I tried to compile a list of all the taxes President Obama and his
hours of debate, Ed Pastor, a Mexican-American allies were maneuvering to impose. But each week brings new ideas. Just
congressman from Arizona, made a motion: “The best recently we’ve heard about a bank tax, applying the Medicare tax to
candidate is Sonia Sotomayor, and we should take a vote capital gains and other “passive” or “unearned” income, raising the
right here.” The meeting ended with a unanimous vote for Medicare tax rate, raising or broadening the capital gains tax, an income
Sotomayor. tax “surtax,” a tax on tanning – and of course the tax on private health
insurance to pay for the expansion of government insurance has moved
Latino leaders also lobbied their black counterparts to the to the top of the list.
cause. “The concern of some people, and I believe some in the
White House, was with what political capital they could use in And all of these on top of these ideas proposed or publicly floated by
nominating a Latina in terms of the black community, who President Obama and his aides and allies:
feel that Clarence Thomas doesn’t represent them,”
Velázquez said. On the House floor, Velázquez approached • Raise the top income tax rates from their current 33 percent and 35
the North Carolina representative Mel Watt, who serves on percent rates to 36 percent and 39.6 percent in 2011
the House Judiciary Committee, and who formerly chaired
the Congressional Black Caucus. A few days later, Watt called • Limit itemized deductions for people paying high rates
Velázquez on a Saturday. “Nydia, I placed a call to the White
House,” he said. “I said, ‘If there’s not a black candidate that • Increase capital gains and dividend taxes by 33 percent for people
makes the short list, we will be supportive of Sonia paying high income tax rates
Sotomayor.’ ”
• Impose a value-added tax (VAT) on all goods and services
I guess Sotomayor knows the score better than I do. After her
confirmation she said (to Collins, presumably, as this quotation is not • Raise the Social Security tax by lifting the cap
otherwise in Nexis):
• Raise a variety of business taxes by $353 billion over 10 years,
“Although we all wish to believe that appointments are only including repeal of LIFO rules, restoring Superfund taxes,
the product of merit, the harsh reality is that the support of seven tax increases on energy companies, and more
community groups is critical to insuring that meritorious
candidates are not overlooked or victimized in the • Tax employer-provided health benefits
appointment process,” she said.
• Implement a cap-and-trade system for emissions permits, the
Politics ain’t beanbag, but I’d like to think that nominations of judges are functional equivalent of a massive new tax
just a little more elevated than porkbarrel politics and the scramble for a
piece of the pie. • Tax drivers on their mileage
• Change rules to raise gift taxes
• Restore the estate tax at 45 percent
• Raise cigarette tax by 62 cents a pack
• Raise taxes on beer, wine, liquor, and soda
• Eliminate health savings accounts and flexible savings accounts
9
• Tax employer-provided cellphones FISCALLY CONSERVATIVE BLOG FEEDS
• Tax AIG employee bonuses Chavez: Too Much Capitalism

• Raise taxes on overseas corporate earnings on TV [The Club for Growth]
JAN 18, 2010 08:57A.M.
Back in July the Wall Street Journal reported:
From the Assocaited Press: CARACAS, Venezuela Ben Cunningham
President Barack Obama’s health-care plan is in jeopardy
because of serious concerns that costs will spin out of control.
As much as anyone, it’s White House budget director Peter
Orszag’s job to save it… FISCALLY CONSERVATIVE BLOG FEEDS
After his TV appearances, he went straight to the Senate IRS Head Uses Paid Preparer,
Finance Committee, where he spent three hours with
committee aides brainstorming about how to pay for the Says Tax Code Too Complex
trillion-dollar legislation. At one point, they flipped through
the tax code, looking for ideas. [Tax Foundation]
JAN 18, 2010 12:00A.M.
Flipping through the tax code, looking for ideas on how to relieve us of
more of our money. That’s a great visual of Obama’s Washington. From the Wall Street Journal:
President Obama and his allies look at the vast abundance in America,
and all they see is wealth that they don’t yet control. It annoys them. Steve Scully, the C-SPAN host, asked [IRS Commissioner Douglas]
They could do so much good with that money. How dare bankers and Shulman if he prepares his own taxes. Shulman smiled slightly and said,
businesses, farmers and entrepreneurs, widows and foundations hold “I use a preparer.”
tight to their wealth, when government has so many plans to fund?
“Let’s go and get it from those who’ve got it,” they cry, in the immortal Scully asked why, to which Shulman smiled and said, “Uh, I’ve used one
words of Sen. Barbara Mikulski. for years. I find it convenient and I find the tax code complex, so I use a
preparer.”
But perhaps Thomas Jefferson’s words are even more immortal and
equally applicable: “He has erected a multitude of New Offices, and sent More on income taxes here.
hither swarms of Officers to harass our people, and eat out their
substance.”
FISCALLY CONSERVATIVE BLOG FEEDS Banks Investigate

Why Does Martha Coakley Constitutional Challenge to
Want to Raise Your Taxes? Proposed Bank Tax [Tax
[Americans for Tax Reform] Foundation]
JAN 18, 2010 10:24A.M. JAN 18, 2010 12:00A.M.
When looking for someone to represent you in Congress, what do you From the New York Times:
normally look for? Is this candidate a proponent of higher economic and
personal freedom? Do they support lowering taxes? Will... Wall Street’s main lobbying arm has hired a top Supreme Court litigator
to study a possible legal battle against a bank tax proposed by the Obama
administration, on the theory that it would be unconstitutional,
according to three industry officials briefed on the matter.
In an e-mail message sent last week to the heads of Wall Street legal
departments, executives of the lobbying group, the Securities Industry
and Financial Markets Association, wrote that a bank tax might be
10
unconstitutional because it would unfairly single out and penalize big more generous, meaning other states need to basically write blank
banks, according to these officials, who did not want to be identified to checks or be out of the competition. That can be a bitter pill to swallow,
preserve relationships with the group’s members. but sometimes you just have to throw in the towel, use money for other
things, and enjoy the benefits of movies subsidized by your neighbors.
It sounds like the argument will be similar to that made against the
proposed tax on AIG bonuses last year. I reviewed the precedents and From RealFilmCareer.com:
constitutional arguments on that idea, finding it would probably be
unconstitutional, here: Michigan faces an ongoing state budget crisis — estimates say the
shortfall could be $1.6 billion this year — and some lawmakers have
Determining whether a law is a bill of attainder involves the application called for a cap or repeal of the incentives.
of a two-part test: (1) whether the legislature has acted with specificity,
and (2) whether the legislature has imposed punishment.[...] “The nonpartisan economists even agree that the film credit program is
extremely costly and is failing miserably, costing the state $100 million
[E]ven where Congress applies a law to a broad group of people, if it is more than it brings in and costing families about 7,500 full-time jobs
easily ascertainable that a particular person or class is the target of the from the private sector,” state Rep. Tom McMillin, R-Rochester Hills,
legislation, it satisfies the specificity test.[...] said in a statement last week.
[T]he questions are whether singling out a group for a very high tax “The numbers are not adding up to job creation as promised. The state
would constitute punishment under any of three factors. For the first, it will take $100 million out of businesses in 2010 to pay for things like
would be whether such a tax falls within the historical meaning on out-of-state actors’ salaries and expensive dinners. That means less
legislative punishment. For the second, it would be whether the tax’s money for existing businesses to hire new employees or keep existing
nonpunitive purposes outweigh the asserted punishment. For the third, ones,” he said.
it would be whether there is legislative record demonstrating
punishment was a motivation behind the bill. McMillin introduced a bill in August to repeal the credits, but it hasn’t
emerged from the commerce committee.
Read the rest here. To the extent that the proposed tax on banks is
viewed, by legislators and by observers, as a punitive measure, it could Incentive opponents may get a boost from a national report issued last
be in tension with the Constitution. week by the Tax Foundation, a nonprofit Washington, D.C.-based think
tank on government tax policies, that’s critical of industry-specific tax
A friend of mine asked why a tax on banks would be unconstitutional but breaks and suggests states would see wider economic benefit if they were
a bailout for banks wouldn’t be. The answer to that question depends on repealed.
how broadly you think courts should interpret the phrase “general
welfare” in the Constitution. From the Detroit News:
The Tax Foundation says star-struck states like ours, boasting about
their film credits, are engaged in “a contest of who can funnel the
FISCALLY CONSERVATIVE BLOG FEEDS taxpayers’ money into the film industry fastest.”
Michigan Debates Expensive Our film tax cuts will cost state government $98 million this year and
$120 million in the 2011 budget year, when it faces a $1.6-billion revenue
Film Tax Credit Program [Tax shortfall. The state also provides hundreds of millions in tax breaks to an
array of other industries.
Foundation]
JAN 18, 2010 12:00A.M. We can’t afford to end the program when we are so desperate for jobs,
but our financial plight is making it harder to sustain. That makes it
Michigan’s generous program of paying cash rebates to filmmakers who urgent for lawmakers to figure out a sustainable method of keeping
film in the state has been successful at getting filmmakers to take the Michigan attractive to filmmakers.
money. It shouldn’t be surprising that giving people cash and essentially
wiping out their tax liability results in lots of increased economic activity. With Michigan so determined to pour its tax dollars into filmmakers’
The real question is why Michigan wants to do this just for the film pockets as the state falls apart, other states should be wary of taking
industry and not for everyone. them on.
They may have to answer that question sooner rather than later. As we
document in our new report on film tax credits, some states are bidding
up their generous motion picture incentive packages to become even
11
FISCALLY CONSERVATIVE BLOG FEEDS Miss any?
Proposed Tax and Revenue

Increases From President FISCALLY CONSERVATIVE BLOG FEEDS
Obama’s First Year [Tax LaHood Eliminates Cost-

Foundation] Efficiency Rules [Cato at
JAN 18, 2010 12:00A.M.
Liberty]
David Boaz from the Cato Institute puts together a list of the various tax JAN 17, 2010 10:34P.M.
increases/revenue increases proposed at the federal level over the past
year: By Randal O’Toole
• Raise the top income tax rates from their current 33 percent and 35 Last week, Secretary of Transportation Ray LaHood announced that
percent rates to 36 percent and 39.6 percent in 2011 federal transit grants would now focus on “livability.” Buried beneath
this rhetoric is LaHood’s decision to eliminate the only efforts anyone
• Limit itemized deductions for people paying high rates ever made to make sure transit money isn’t wasted on urban monuments
that contribute little to transportation.
• Increase capital gains and dividend taxes by 33 percent for people
paying high income tax rates Back in 2005, then-Transportation Secretary Mary Peters stunned the
transit world when she adopted a “cost-effictiveness” rule for federal
• Impose a value-added tax (VAT) on all goods and services transit grants to new rail projects. In order to qualify, transit agencies
had to receive a “medium” cost-effectiveness rating from the FTA,
• Raise the Social Security tax by lifting the cap meaning they had to cost less than about $24 for every hour they would
save transportation users (either by providing faster service to transit
• Raise a variety of business taxes by $353 billion over 10 years, riders or by reducing congestion to auto drivers). This wasn’t much of a
including repeal of LIFO rules, restoring Superfund taxes, requirement: a true cost-efficiency calculation would rank projects, but
seven tax increases on energy companies, and more under Peters’ a project that cost $0.50 per hour saved would be ranked
the same as one that cost $23.50 per hour. But any projects that went
• Tax employer-provided health benefits over the $24 threshold (which was indexed to inflation — by 2009 it was
up to $24.50) were ruled out.
• Implement a cap-and-trade system for emissions permits, the
functional equivalent of a massive new tax After unsuccessfully protesting this rule, transit agencies responded in
one of four ways. Those close to the $24 threshold cooked their books to
• Tax drivers on their mileage either slightly reduce the cost or slightly increase the amount of time the
project was supposed to save. Those that were hopelessly far away from
• Change rules to raise gift taxes the $24 threshold, but had powerful representatives in Congress,
obtained exemptions from the rule. These included BART to San Jose,
• Restore the estate tax at 45 percent the Dulles rail line, and Portland’s WES commuter train. Those that
didn’t have the political clout either shelved their projects or, in a few
• Raise cigarette tax by 62 cents a pack cases such as the Albuquerque Rail Runner commuter train, tried to
fund them without federal support.
• Raise taxes on beer, wine, liquor, and soda
In 2007, when Congress created a fund for “small starts,” Peters imposed
• Eliminate health savings accounts and flexible savings accounts another rule that transit agencies would have to show that streetcars
were more cost-effective than buses. This led to further protests because
• Tax employer-provided cellphones the the money was “supposed to be for streetcars” — the provision had
been written by Earl Blumenauer, who represents Portland, the city that
• Tax AIG employee bonuses started the modern streetcar movement. But everyone knew streetcars
would never be as cost-efficient as buses. This meant that, except for
• Raise taxes on overseas corporate earnings Portland, virtually every agency that had wanted to waste federal money
on streetcars shelved their plans.
12
Until now. LaHood’s announcement means that cost is no longer an power in the relationship, want to determine the timeline on which the
issue. If your project promotes “livability” (which almost by definition attack occurs? Why just defer to Tel Aviv?
means anything that isn’t a new road) or “economic development”
(meaning it will be accompanied by subsidies to transit-oriented
developments), LaHood will consider funding it, no matter how much
money it wastes.
Many transit agencies are elated. Cities from Boise to Minneapolis to

Houston now see that their wacko projects that defy common sense now
have a chance of getting funded.
The bad news for transit agencies is that this doesn’t mean there will be
any more money for transit. Instead, there will be more competition for
the same pot of money. Not to worry: House Democrats plan to open the
floodgates to more transit spending as soon as they can get federal
transportation funding reauthorized. This means taxpayers can expect to
see more of their money wasted and commuters can expect congestion to
get worse as more of their gas taxes are funneled into inane rail
projects.
Ariel Cohen
Hynd also points to an accompanying piece by Ariel Cohen that calls on

FISCALLY CONSERVATIVE BLOG FEEDS the U.S. to extend nuclear deterrence over Israel, Egypt, and Saudi
Arabia, and to “deploy a visible deterrent, including overwhelming
Heritage Seems Ready for War nuclear forces near Iran, on surface ships, aircraft, or permanent bases …
designed to hold at risk the facilities that Iran would need to launch a
with Iran [Cato at Liberty] strategic attack, thereby making any such attack by Iran likely to fail.”
JAN 17, 2010 10:29P.M. Interestingly in a passage he attributes to personal meetings with
Vladimir Putin and Sergei Lavrov, he says the Russian leadership sees
By Justin Logan Iran as a “regional superpower” and doesn’t want to go to war with them.
Steve Hynd at Newshoggers looks at Heritage’s recent work on Iran and Cohen also says bombing is better than non-bombing because of the
observes that it sure seems like they’re prepared for war. James Phillips “existential threat” a nuclear Iran would pose to Israel, as well as Cohen’s
says the Israelis may attack Iran but we shouldn’t try to stop them. worry that by not bombing “the U.S. would send a message to other
Phillips notes uncritically Israeli PM Binyamin Netanyahu’s countries that nuclear weapons are the trump card that can force U.S.
characterization of the Iranian state as a “a messianic apocalyptic cult” and Israeli acquiescence.” But they sort of are that sort of trump card,
and points out that while the United States “has the advantage of being right? Presumably that’s why the Iranians and the North Koreans appear
geographically further away from Iran than Israel and thus less to have been so enthusiastic about getting some. Ultimately, says Cohen,
vulnerable to an Iranian nuclear attack … it must be sensitive to its ally’s the U.S. should drop the pretense of UN sanctions against Iran and opt
security perspective.” instead for a sanctions coalition of the willing. We should also apply
unilateral sanctions against Russia for refusing to join the Iran sanctions
Therefore we should accede to an Israeli preventive strike and prepare coalition, and we should station nuclear weapons in the Middle East.
for the consequences. What’s odd about Phillips’ piece is that he doesn’t
seem to think that the United States should provide its own view as to This is getting a bit too long for a blog post already, so I’ll just point to
when an attack would be smart and when it would not be. Instead, we the study I produced on the “should we bomb Iran?” question back in
should just toss the keys to the Israelis and buckle up: “Wash-ington 2006 for those with interest. The basic outline of the argument holds up
should not seek to block Israel from taking what it considers to be reasonably well, I think, so my thoughts are mostly contained in it. While
necessary action against an existential threat. The United States does not the Heritage scholars point out that the Obama administration is
have the power to guarantee that Israel would not be attacked by a unlikely to be terribly enthusiastic about bombing Iran, it’s an
nuclear Iran in the future, so it should not betray the trust of a interesting counterfactual to think about what things might look like if
democratic ally by tying its hands now.” This is a pretty high standard. John McCain had won the presidency. Imagine the Sarah Palin
It’s very difficult to guarantee a third party won’t do something in the speeches.
future. If that’s the standard we’re using to determine when we allow
ourselves to be sucked into wars, we’re in for a lot of wars. Moreover, I’m
clear on the logic of starting a war, but why wouldn’t we, as the larger
13
FISCALLY CONSERVATIVE BLOG FEEDS Try it for yourself. If you have access to any database of news
stories up to about the 1960s, see how many articles you can
The Way We Were [Cato at find about homosexuality using the words you know to
describe sexual orientation.
Liberty]
JAN 17, 2010 02:46P.M. Than try using these: “deviant;” “degenerate;” “pervert.”
By David Boaz That is the way homosexuality was both understood and
reported (when it was reported at all) in days gone by.
Conservatives and even libertarians often view history through the prism
of “the road to serfdom,” believing that there was some golden age of Those are the words, and the preconceptions, that would
liberty in the past that is progressively being eroded. Two recent articles have been dominant, if not exclusive in the minds of the
remind us of some of the problems with that thesis. single demographic we can most reliably count on to vote
against us today – seniors. Those who grew up in the 1930s
An obituary in today’s Washington Post told of what happened to and 40s and 50s would have, first, avoided any possible
American-born May Asaki and her family after the outbreak of war discussion of such an unpleasant and impolite subject as
between the United States and her parents’ home country of Japan: homosexuality. That is how the closet – the don’t ask, don’t
tell of its day — accommodated the times.
On May 8, 1942 — May Asaki’s 23rd birthday — she and her
family were loaded into the back of an Army truck and sent to But denial on such a wide scale has to begin fraying at the
a detention center. They were allotted one suitcase each. edges. And when homosexuality did come up, as Chauncey so
vividly described — in criminal trials, bar raids, and mass
May, who was the second oldest of 11 children, spoke only arrests – the reporting had a condemnatory force built-in.
rudimentary Japanese and had known no home but The police arrested a dozen sexual perverts; a high-profile
California. Her older brother volunteered for the Army the degenerate was found in a love nest; a bar owner lost his
day after Pearl Harbor, but his patriotism didn’t help her license because his business catered to deviants.
family. U.S. authorities considered Americans of Japanese
descent to be potential enemies during World War II, and the Taxes may have been lower in the 1950s (though come to think of it, the
Asaki family eventually ended up at an internment camp in a marginal rate was 91 percent). Regulation may been less burdensome
snake-infested swamp in Arkansas. Within six months, May’s (except for the New Deal-derived microregulation of finance,
mother was dead at 48. transportation, and communications). The labor market may have been
freer (unless you got drafted into the armed services, like Elvis and
“My older brother was serving in the U.S. Army while our millions of other young men). But stories like this remind us of how
family was incarcerated as criminals,” May wrote in her many people were excluded from the promises of the Declaration of
memoir, “the stress of which was too great for our mother to Independence — the inalienable rights of life, liberty, and the pursuit of
bear.” happiness — throughout American history. Liberalism has always
campaigned for a society of merit, not of status. That meant in the first
The only good thing to be said for May’s two years of captivity place the dismantling of the privileges of nobility and aristocracy. Over
was that she met Paul Ishimoto, whom she married in April the centuries it has also meant extending liberty and equality to people of
1944. Three months later, when their internment camp was other races and creeds, to women, to Jews, to gays and lesbians. And
closed, they moved to Washington. The federal government current historical trends are certainly more complicated than worries
gave them $25 apiece to start a new life. about a road to serfdom, or nostalgia for “the world we have lost.”
We can only hope that census data will never again be used to round up
American citizens and imprison them on the basis of their race.
Meanwhile, at the Independent Gay Forum, David Link writes about a
historian who was frustrated in trying to find stories in the Los Angeles
Times archives about homosexuality in L.A. during the mid-20th
century. His searches kept coming up empty. Had they simply never
covered such stories?
Then he realized that he was searching for words and phrases

he was used to using: “homosexual” and “gay” and “sexual
orientation.” But those were not the words journalists would
have used prior to our own time.
14
FISCALLY CONSERVATIVE BLOG FEEDS children and adults.
Obama’s Other Massachusetts • Self-reported health improved for some, but fell for others.
Problem [Cato at Liberty] • Young adults appear to be avoiding Massachusetts as a result of the
JAN 17, 2010 02:12P.M. law.
By Michael F. Cannon • Leading estimates understate the cost of the Massachusetts law by
at least one third.
When Obama campaigns for Martha Coakley, he is really campaigning

for his health plan, which means he is really campaigning for the
Massachusetts health plan.
He and Coakley should explain why they’re pursuing a health plan that’s
not only increasingly unpopular, but also appears to have a rather high
cost-benefit ratio.
(Cross-posted at Politico’s Health Care Arena.)
Growing Support for Smaller

Even if Democrat Martha Coakley wins 50 percent of the vote in the race
to fill the late Sen. Ted Kennedy’s (ahem) term, there are other numbers Government [Cato at Liberty]
emanating from Massachusetts that present a problem for President JAN 17, 2010 02:06P.M.
Obama’s health plan.
By David Boaz
On Wednesday, the Cato Institute will release “The Massachusetts
Health Plan: Much Pain, Little Gain,” authored by Cato adjunct scholar A new Washington Post-ABC News poll finds that respondents favor
Aaron Yelowitz and yours truly. Our study evaluates Massachusetts’ “smaller government with fewer services” over “larger government with
2006 health law, which bears a “remarkable resemblance” to the more services” by 58 to 38 percent. Reporter Dan Balz notes:
president’s plan. We use the same methodology as previous work by the
Urban Institute, but ours is the first study to evaluate the effects of the The poll also shows how much ground Obama has lost during
Massachusetts law using Current Population Survey data for 2008 (i.e., his first year of trying to convince the public that more
from the 2009 March supplement). Since I’m sure that supporters of the government is the answer to the country’s problems. By 58
Massachusetts law and the Obama plan will dismiss anything from Cato percent to 38 percent, Americans said they prefer smaller
as ideologically motivated hackery: Yelowitz’s empirical work is government and fewer services to larger government with
frequently cited by the Congressional Budget Office, and includes one more services. Since he won the Democratic nomination in
article co-authored with MIT health economist (and Obama June 2008, the margin between those favoring smaller over
administration consultant) Jonathan Gruber, under whom Yelowitz larger government has moved in Post-ABC polls from five
studied. points to 20 points.
Among our findings: I’ve noted previously that
• Official estimates overstate the coverage gains under the I’ve always thought the “smaller government” question is
Massachusetts law by roughly 50 percent. incomplete. It offers respondents a benefit of larger
government — “more services” — but it doesn’t mention that
• The actual coverage gains may be lower still, because uninsured the cost of “larger government with more services” is higher
Massachusetts residents appear to be concealing their lack of taxes. The question ought to give both the cost and the
insurance rather than admit to breaking the law. benefit for each option. A few years ago a Rasmussen poll did
ask the question that way. The results were that 64 percent of
• Public programs crowded out private insurance among low-income voters said that they prefer smaller government with fewer
15
services and lower taxes, while only 22 percent would rather to their results tables in section 4 of the report, on cognitive outcomes.
see a more active government with more services and higher Indeed when they apply their own choice of control for false positives
taxes. A similar poll around the same time, without the due to multiple tests (Benjamini-Hochberg), they, too, find that none of
information on taxes, found a margin of 59 to 26 percent. So the cognitive effects holds up. Kudos.
it’s reasonable to conclude that if you remind respondents
that “more services” means higher taxes, the margin by which
people prefer smaller government rises by about 9 points.
In fact, Rasmussen has continued to ask just that question, and found a
month ago that voters preferred “smaller government with fewer services Hijacking Neutrality [Cato at
and lower taxes” by a margin of 66 to 22 percent. That’s a larger margin
for the alternative wording than I had previously estimated. I know some Liberty]
people are skeptical of Rasmussen’s polling. (A Republican consulting JAN 15, 2010 05:39P.M.
firm recently found results very similar to the Rasmussen poll.) So I
invite Gallup, Harris, the New York Times, the Washington Post, and By Julian Sanchez
other pollsters to ask this more balanced question and see what results
they get. Perhaps he’s too demure to say “I told you so” himself, but events are
bearing out the concerns about net neutrality and regulatory capture that
Tim Lee expressed in his excellent Cato paper “The Durable Internet.”
The content industry is lobbying not just to ensure that neutrality rules
FISCALLY CONSERVATIVE BLOG FEEDS permit filtering of Internet traffic by ISPs to block copyrighted material,
but wants the FCC to positively encourage it. As a brief from the Motion
But Wait, There’s Less! [Head Picture Association of America suggests:
Start Unravels Further] [Cato at In fact, if the Commission wants to see a meaningful and
long-term reduction in the amount of bandwidth consumed
Liberty[Head Start Unravels by illegal content, it should foster an environment in which
innovation itself is able to flourish and new tools are not only
Further]] permitted, but encouraged, to develop. The government
JAN 15, 2010 05:49P.M. should create incentives for this investment by clarifying that
industry efforts will be rewarded with open and flexible
By Andrew J. Coulson regulations.
I’d missed something about the new Head Start Impact Study until this The Electronic Frontier Foundation has been out of step with some of
morning. It reports 44 cognitive test results, only one two of which were their usual allies on this front, arguing that however desirable the open
statistically significant at the end of 1st grade. The thing is, a certain Internet might be, the broad assertion by the FCC of authority to control
number of apparently significant results are to be expected merely by network architecture sets a dangerous precedent. The implicit threat to
chance, and the probability of these false positives grows in proportion ISPs here is: “Go along with our wish list for intrusive filtering or we’ll
to the number of tests you report. find a way to use the rules to make trouble for you.”
Statisticians use a variety formulas to control for the expected The telecoms, meanwhile, are pressing for the applicability of neutrality
proliferation of false positives when multiple results are reported, and rules to all sorts of other application-level service providers, such as
even if we apply a very forgiving control (the Dubey and Armitage- Google. An AT&T filing argued that “the commission cannot rationally
Parmar procedure with an assumed average correlation among results of impose rules on one set of providers based on hypothetical concerns
.8), the two marginally “significant” Head Start result become, you while exempting other providers that act as Internet gatekeepers and
guessed it, insignificant. (If we were to apply the very conservative have engaged in actual misconduct.” They specifically called out Google,
Bonferroni correction, these marginal results would be savagely beaten, which they assert “shapes how consumers actually experience the
buried in concrete, and dropped into the Mariana Trench.) Internet more than any given broadband provider possibly could.”
In short, this very high quality study of a very large national sample of It would, to be sure, be perverse if industry players managed to use
students reveals absolutely no evidence of statistically significant regulations designed to promote openness and innovation as a cudgel
cognitive benefits to Head Start at the end of first grade. None. with which to whack innovative competitors. But in the world of
regulation, no less than in the domains studied by Alfred Kinsey, it turns
To their considerable credit, the authors acknowledge this issue in out that the perverse is perfectly normal.
footnote 99 on page 6-2 of the full report, linked above, and in the notes
16
Advisers for Science and Technology, which was telecast live on the web
and archived.
Finally, Chopra touted the planned January 22nd roll-out of data feeds
Another Democrat Retires: Vic from every federal agency under a recent open government
memorandum — three “high-value data sets” per agency. In working
Snyder (AR-02) [The Club for toward this, Chopra said, “the conversation is all about what would help
you do what you do better. How can we advance our shared goals of
Growth] reducing disparities in health care, improving our commitment to
JAN 15, 2010 05:36P.M. renewable energies, advancing our collective educational results?”
A local news outlet has a report here. This language and some of the examples cited in the video cause me
to worry that the transparency effort may be heading for a detour. Rather
than substantive insight into government management, deliberations,
and results, we might get a lot of data-oriented play-toys.
According to the memorandum:
Is Government Transparency
High-value information is information that can be used to
Headed for a Detour? [Cato at increase agency accountability and responsiveness; improve
public knowledge of the agency and its operations; further
Liberty] the core mission of the agency; create economic opportunity;
JAN 15, 2010 05:04P.M. or respond to need and demand as identified through public
consultation.
By Jim Harper
That’s a very broad definition. Without more restraint than that, public
With a year in office, and perhaps under some pressure to deliver on choice economics predicts that the agencies will choose the data feeds
promises of transparency and change, the White House went on a with the greatest likelihood of increasing their discretionary budgets or
little PR offensive this week. It rolled out a blog post and a video the least likelihood of shrinking them. That’s data that “further[s] the
claiming the transparency successes of the administration’s first year. A core mission of the agency” and not data that “increase[s] agency
lot has gone on, and it’s worth a review. It’s also worth noting some accountability and responsiveness.” It’s the Ag Department’s calorie
signals that the government transparency project could be heading for a counts, not the Ag Department’s check register.
slight detour.
The kind of substance the transparency community expects is well
In the video — a little infomercial-y, but tolerable and interesting — represented in a report issued jointly by the Center for Democracy and
federal chief technology officer Aneesh Chopra cites several examples of Technology and OpentheGovernment.org in March of last year.
government use of technology. A system called ISDS Distribute helps the It’s called “Show Us the Data: Most Wanted Federal Documents,” and it
government monitor flu outbreaks, for example, akin to Google.org’s Flu asks for access to important research and governmental process
Trends. Chopra touted the benefits of machine readability and the information with the capacity to generate real insights into government
Agriculture Department’s release of data about a thousand most and its operations.
commonly eaten foods. (I’m not sure if this is it, but if not it’s probably
something similar. Someone like Mike could use it to build a site that is Interesting data that the agency has collected or produced may be just
further along than 1996’s state-of-the-art.) And Chopra discussed that — interesting — but the heart of the government transparency effort
the platforms they are building at apps.gov to help agencies draw on the is getting information about the functioning of government. Once we
participation and engagement of the public. Putting aside how these have these core elements of transparency captured, other data are
illustrate the federal government’s distended role, these are all absolutely good to have. But let the starting point be the workings of
fine things. agencies themselves.
White House ethics counsel Norm Eisen cited the release of visitor To help focus agencies on releasing the data that is high-value for
records as “one of the big innovations in the White House” over the past genuine government transparency, I plan to examine the three data-
year. (Good, yes. But “big”?) Eisen dodged the question about why health streams each agency releases and grade the agencies on whether their
care negotiations are not on C-SPAN. releases provide insight into agency management, deliberations, or
results.
In response to a question about putting federal advisory committees
online, Chopra told of a recent meeting of the President’s Council of As I examine the agency’s data feeds, I’ll use their proximity to true
17
government transparency to assign them a letter grade, awarding them FISCALLY CONSERVATIVE BLOG FEEDS
three points for each feed that has to do with management, deliberation,
or results. These numerical scores — 9, 6, 3, or 0 — I’ll translate into Is Russia’s Gas Behavior Driven
grades: A, B, C, or D. (Nobody fails when the criteria only came out a
week in advance.) F is reserved for agencies that don’t produce feeds. by Targets’ Domestic Politics?
This rubric for rating the data that agencies release seems reasonably [Cato at Liberty]
objective, and a decent measure of which agencies are really responding JAN 15, 2010 03:20P.M.
to the demand for transparency and change, and which are pushing
interesting data out as a smokescreen against deeper insights and By Justin Logan
reform. Hopefully, this effort at focusing agencies on true high-value
data will see some uptake among my colleagues in the transparency Back when Russia was turning off the spigots to pipelines running
community (if I haven’t alienated them with my endless harping on through Ukraine, Official Washington was in a panic. Just a few years
President Obama’s Sunlight Before Signing promise). Watch this space after the Orange Revolution was supposed to have heralded a new era of
for agency grades shortly after the release of the feeds. freedom and democracy in Ukraine, Russia was using its economic
muscle to stifle the growth of that freedom because of the threat it felt a
democratic Ukraine posed to the Putin regime’s grip on power. It was a
lot like the “democratic dominoes” argument the neoconservatives
FISCALLY CONSERVATIVE BLOG FEEDS deployed in promoting the Iraq war.
Obama in a Major Wicked Pinch As Washington Post editorialist Jackson Diehl stated the case in 2007,
[The Club for Growth] Putin sees the fragile new democracy in Ukraine, and an
JAN 15, 2010 03:50P.M. allied government in the tiny Black Sea nation of Georgia, as
dire threats. If Western-style freedom consolidates and
Strictly as a matter of pure politics, President Obama t be there for them, spreads in the former Soviet republics of Eastern Europe, his
either. Obama has to go, if only to keep the congressional Democrats he own undemocratic regime will be isolated and undermined.
DOES HAVE on board. For a political junkie, this is fun: like playing What’s more, Ukraine and its neighbors are likely to integrate
chess instead of checkers. with Europe rather than remaining economic and political
vassals of Russia.
Secretary of State Rice warned that Russia’s behavior on energy

FISCALLY CONSERVATIVE BLOG FEEDS constituted “politically motivated efforts to constrain energy supply to
Ukraine” as punishment for the former Soviet republic’s pro-Western
Nelson Backs Down [The Club orientation. In short, the argument was that Ukrainian democracy
threat to the Russian regime Russian gas cutoffs.
for Growth]
JAN 15, 2010 03:28P.M. Others argued that Russia’s increasingly nasty behavior was less about
the internal political contours of its neighbors and more about power
From Roll Call ($): Sen. Ben Nelson (D-Neb.) on Friday asked that a deal politics and making sure the neighbors would be compliant with Russian
he secured for his state on Medicaid funding be removed from the health interests, much like the United States has sought in the Western
care reform bill, a move that follows weeks of unrelenting political Hemisphere since at least the Monroe Doctrine.
blowback. So let me get this straight. t unring that bell.
18
• Podcast: “Obama and Immigration in 2010” featuring Daniel

Griswold.
Reforming Previous Reforms,

ad Infinitum [Cato at Liberty]
JAN 15, 2010 03:06P.M.
By David Boaz
In the forthcoming issue of Cato Policy Report, Jeffrey Friedman

describes the cumulative effects of regulations that led to the 2008
Fred Hiatt: Lukashenko’s domestic reforms a threat to Russia financial collapse:
So if fear of democracy and liberalism were driving Russia’s behavior So deposit insurance begat bank-capital regulations. Initially
back then, then what is causing the current cutoff dispute with non- these were blunderbuss rules that required banks to spend
democratic and unfriendly-to-Washington Belarus? It’s radio silence the same levels of capital on all their investments and loans,
from most of Washington, with a notable exception: the exquisitely regardless of risk. In 1988 the Basel accords took a more
Russophobic Washington Post op-ed page. Fred Hiatt and the Gang are discriminating approach, distinguishing among different
sticking to their story, offering the ridiculous argument earlier this week categories of asset according to their riskiness — riskiness as
that in fact Moscow was acting to suppress Belarusian dictator Aleksandr perceived by the regulators. The American regulators decided
Lukashenko’s incipient liberalism, which was evinced by Lukashenko’s in 2001 that mortgage-backed bonds were among the least
having “released a few political prisoners” and “refusing to recognize the risky assets, so they required much lower levels of capital for
two puppet states that Moscow is backing in Georgia.” these securities than for every alternative investment but
Treasurys. And in 2006, Basel II applied that erroneous
A less ornate explanation would be that perhaps Russia is more fixated judgment to the capital regulations governing most of the rest
on material factors and less on ideology. of the world’s banks. The whole sequence leading to the
financial crisis began, in 1933, with deposit insurance…
Deposit insurance, hence capital minima, hence the Basel

FISCALLY CONSERVATIVE BLOG FEEDS rules, might all have been a mistake founded on the New Deal
legislators’ and regulators’ ignorance of the fact that panics
Weekend Links [Cato at like the ones that had just gripped America were the
unintended effects of previous regulations.
Liberty]
JAN 15, 2010 03:08P.M. Friedman is talking about financial and housing regulation. But I was
reminded of them when I heard President Obama tell congressional
By Chris Moody Democrats, “Today we are on the doorstep of accomplishing something
that Washington has been talking about since Teddy Roosevelt was
• Jeffrey Miron on Obama’s bank fees: “Bailing out the banks was President, and that is reforming health care and health insurance here in
wrong, but a new tax won’t make it right.” America.” And his formal speech to Congress in September: “I am not
the first President to take up this cause, but I am determined to be the
• What Constitution? If Congress can order you to buy health last.”
insurance, why stop there?
But of course we’ve been “reforming” health care ever since Teddy
• Don’t poke the bear: There is a proposal in the Senate Foreign Roosevelt, and those reforms have brought us to our present difficulties.
Relations Committee to rearm the country of Georgia. The Flexner Report 100 years ago reduced the supply of doctors and
drove up the price. Wage and price controls during another Roosevelt era
• Why the tragedy in Haiti cries out for swift action from private led to the system of employer-provided insurance, again driving up costs.
donors and yes, governments. Medicare and Medicaid poured more third-party payments into the
system and added layers of government bureaucracy. HMOs and other
19
cost-containment measures were a response to a problem created by the FISCALLY CONSERVATIVE BLOG FEEDS
absence of normal consumer pressure. Then we got HIPAA, Kennedy-
Kassebaum, the Mental Health Parity Act, state mandated-coverage As Vote Nears, Broad
laws, and the Medicare Prescription Drug Benefit.
Opposition to Conrad/Gregg
And here we are today, with a health care system that everyone agrees
needs reform. Maybe it’s time to recognize that we’re just piling new Commission Bill [Americans for
regulations on top of old regulations, like some compulsory Rube
Goldberg device, and to try instead free markets, in which Tax Reform]
consumers pay for what they want from providers, JAN 15, 2010 02:41P.M.
insurance companies, managed care organizations, and other entities
that compete for their business by seeking to provide better care at lower CFA and ATR have joined forces with numerous groups and individuals
prices. Otherwise, we can be sure that Barack Obama won’t be the last representing the broad Center-Right coalition in opposition to the
president to stand before Congress and declare that our health insurance Conrad-Gregg bipartisan tax/spending “reform” comm...
system needs reform. Indeed, we can bet that if he signs the current bill,
he himself will be back before Congress in a year or two asking for
reforms to reform the reforms that were intended to reform the previous
reforms. FISCALLY CONSERVATIVE BLOG FEEDS
‘Repeal It!’ Pledge Sweeps Five

FISCALLY CONSERVATIVE BLOG FEEDS Senate Primaries [‘The Club for
Californians: Do You Know Growth]
JAN 15, 2010 01:26P.M.
Which Candidates Have Signed
WASHINGTON S COMMITTEE. 202-955-5500.
the Taxpayer Protection Pledge?
[Americans for Tax Reform]
JAN 15, 2010 03:04P.M. FISCALLY CONSERVATIVE BLOG FEEDS
Yesterday, Jon Fleischman of The Flash Report put California’s This Week in Government
candidates for elected office on notice that they’ll be highlighting which
candidates have signed the Taxpayer Protection P... Failure [Cato at Liberty]
JAN 15, 2010 12:35P.M.
By Tad DeHaven
Over at Downsizing Government, we focused on the following issues this

week:
• It’s time to end the federal government’s bias toward

homeownership.
• Federal agriculture subsidies make it difficult to find Pepsi or Coke

with real sugar in it.
• Government job creation efforts are a loser for taxpayers,

employers, and employees.
• The Department of Health and Human Services is not up to the

task of handling the additional responsibilities pending health care
legislation would give it.
20
• The latest on cost overrun incompetence at the Department of

Energy.
21

Today's Tabbloid: The Brown Revolution (Cato at Liberty)

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Today's Tabbloid: The Brown Revolution (Cato at Liberty)

Uploaded by

Copyright:

Available Formats

20 January 2010

Brown is no libertarian. But he campaigned against the Obama-Reid-

Pundits have been describing a possible Brown victory in terms like

Thankfully, there is resistance to Obama’s bribe-to-the-top scheme.

The important question, of course, is whether sponsoring this race is

Sure, in response to RttT states have been raising charter-school

FISCALLY CONSERVATIVE BLOG FEEDS FISCALLY CONSERVATIVE BLOG FEEDS

Take Action: Tell Your Senators Special Election Edition of

The following is cross-posted at www.fiscalaccountability.org: The

FISCALLY CONSERVATIVE BLOG FEEDS

[Americans for Tax Reform] WHAT’S THE MESSAGE MASSACHUSETTS IS SENDING?

MASS SHOWDOWN LATEST

Please join us. The Kudlow Report. 7pm ET. CNBC.

For the purposes of this Estimate, by “nuclear weapons

Parsing it briefly: A penalty is not a tax. A voluntary payment is not a tax.

With even the New York Times referring to President Obama’s

So here is Scott Brown appealing to tea-party Democrats, independents,

By Tad DeHaven FISCALLY CONSERVATIVE BLOG FEEDS

simply move from our current 11 to 1 student/teacher ratio to

So kudos to Douglas. His speech was a contrast to that of

FISCALLY CONSERVATIVE BLOG FEEDS FISCALLY CONSERVATIVE BLOG FEEDS

A Remarkable Story - Trapped Racial Politics and the Supreme

“Mr. President, she’s a very qualified person, and it would be

• Change rules to raise gift taxes

• Restore the estate tax at 45 percent

• Raise cigarette tax by 62 cents a pack

• Raise taxes on beer, wine, liquor, and soda

• Eliminate health savings accounts and flexible savings accounts

• Tax employer-provided cellphones FISCALLY CONSERVATIVE BLOG FEEDS

• Tax AIG employee bonuses Chavez: Too Much Capitalism

FISCALLY CONSERVATIVE BLOG FEEDS

FISCALLY CONSERVATIVE BLOG FEEDS Banks Investigate

FISCALLY CONSERVATIVE BLOG FEEDS Miss any?

Proposed Tax and Revenue

Obama’s First Year [Tax LaHood Eliminates Cost-

Many transit agencies are elated. Cities from Boise to Minneapolis to

Hynd also points to an accompanying piece by Ariel Cohen that calls on

Then he realized that he was searching for words and phrases

FISCALLY CONSERVATIVE BLOG FEEDS children and adults.

When Obama campaigns for Martha Coakley, he is really campaigning

(Cross-posted at Politico’s Health Care Arena.)

FISCALLY CONSERVATIVE BLOG FEEDS

Growing Support for Smaller

Among our findings: I’ve noted previously that

Secretary of State Rice warned that Russia’s behavior on energy

• Podcast: “Obama and Immigration in 2010” featuring Daniel

FISCALLY CONSERVATIVE BLOG FEEDS

Reforming Previous Reforms,

In the forthcoming issue of Cato Policy Report, Jeffrey Friedman

Deposit insurance, hence capital minima, hence the Basel

‘Repeal It!’ Pledge Sweeps Five

Over at Downsizing Government, we focused on the following issues this

• It’s time to end the federal government’s bias toward

• Federal agriculture subsidies make it difficult to find Pepsi or Coke

• Government job creation efforts are a loser for taxpayers,

• The Department of Health and Human Services is not up to the

• The latest on cost overrun incompetence at the Department of

You might also like