Cato Op-Eds

Individual Liberty, Free Markets, and Peace
Subscribe to Cato Op-Eds feed

The short answer is: Yes, Donald Trump likely has greater appeal among less educated Americans.

While we should keep in mind that the margins of error are wider for subsets of national polls—Trump consistently performs better among Americans who have not graduated from college than among college graduates.

For instance, Rasmussen finds that among Republicans who have not finished college, 25 percent support Trump for president compared to 11 percent among Republican college grads.

No other Republican candidate comes within 16 points of Trump among GOP non-college grads. However, among Republicans with college degrees, Trump is just one of many favored candidates: Scott Walker (13 percent), and Carly Fiorina (12 percent) score slightly better, and Marco Rubio (11 percent) ties Trump. All of these are within the margin of error.

Similarly, an August CNN/ORC poll finds that in a hypothetical match-up, Hillary Clinton leads Trump by 15 points among college graduates nationally, but only leads by two points among non-college graduates. Moreover, another CNN/ORC poll found that among all Americans, Trump’s favorables were underwater: -32 points among college grads but only by -8 points among non-college grads.

These August polls line up with July polls finding Trump performing better among less educated voters, as I detail in this piece at Federalist.

Does this mean that Trump’s appeal is any less genuine or meaningful? Definitely not. But his candidacy has the capacity to divide the more educated from the less educated.

For more public opinion analysis sign up here for weekly digest of Cato Public Opinion Insights.

Alaska Gov. Bill Walker (I) initially asked the legislature to approve the state’s participation in ObamaCare’s Medicaid expansion. The legislature has thus far declined. Now, Walker is trying to implement it anyway, and the legislature appears to be taking him to court. According to Alaska Dispatch News:

The Alaska Legislature on Tuesday said it will sue Gov. Bill Walker to block his move last month to expand the public Medicaid health care program without lawmakers’ approval.

Following a private discussion Tuesday morning, a Republican-controlled House-Senate committee voted 10-1 to spend up to $450,000 on two law firms to represent the Legislature in a suit against the governor.

One, Bancroft PLLC, is based in Washington, D.C., and represented more than two dozen states in their U.S. Supreme Court challenge to the Affordable Care Act, or “Obamacare.” The second, Holmes, Weddle & Barcott, is based in Anchorage.

In a news conference after the committee vote, Republican leaders framed their decision to challenge the governor as a constitutional one. They’re seeking an injunction to stop Medicaid expansion from going into effect Sept. 1.

“This is not a policy issue — we’re not discussing whether we should or shouldn’t expand Medicaid,” said Senate President Kevin Meyer, R-Anchorage. “This is a question of authority and process and our constitution.”


The Legislature is challenging Walker’s move based on a provision in Alaska statute that requires legislative approval before Medicaid coverage can be offered to people whose care is not required under federal law.

The version of “Obamacare” passed by Congress required states to expand Medicaid to cover low-income Americans, who can otherwise face steep health care costs without the subsidies that the legislation offers to individuals with higher incomes.

As written, the law would have revoked all federal Medicaid funding for states that didn’t go through with the expansion. But the U.S. Supreme Court said in 2012 that the threat of revoking the money was unconstitutional and coercive.

The ruling created ambiguity for Alaskan policymakers and legal experts: If Medicaid expansion is technically required under the ACA, but the Supreme Court has ruled the federal government can’t enforce the requirement by revoking money from states that don’t comply, does that make the newly eligible people under Walker’s proposed expansion an optional group that requires legislative approval?

Walker, citing a memorandum from Attorney General Craig Richards, says no. The Republican lawmakers that support the lawsuit say yes and argue the governor is circumventing their authority.

An initial filing in the Legislature’s lawsuit is expected next week.

Read the whole thing here. For more, see these posts from the Foundation for Government Accountability.

Landon Thomas, Jr. of The New York Times reports that the International Monetary Fund (IMF) might not pony up any cash for the third Greek bailout. To calculate the odds on whether the IMF will, or will not, contribute bailout funds requires knowledge of the IMF’s little Greek secret.

By late 2009, Greece was clearly in big trouble. The European Commission (EC) and the European Central Bank (ECB) did not trust the Greek government. So, the IMF was called in to negotiate loan conditions for new Greek financing. Dominique Strauss-Kahn (DSK) was the IMF’s managing director and was preparing to run for the French presidency as the Socialist candidate. DSK was more than willing to give his socialist brothers in Athens a helping hand. As a result, in 2010, Greece received a massive bailout.

Just how massive? Normally, the IMF is limited to lending up to six times a country’s IMF quota subscription to that country. However, if the IMF judges a country’s debt to be sustainable, then that country can qualify for “exceptional access,” and the IMF credit extended to such a country can exceed the 600% limit. Thanks to DSK and the IMF experts, the debt sustainability reports were rosy, until recently. The IMF extended credit to Greece, and did so generously.

The following table tells the tale. Greece holds the record for the highest IMF credit level relative to a country’s quota.

What about the little secret? Well, the IMF has been caught out. It’s massively overextended to Greece. And that explains the cat and mouse game over whether the IMF will, or will not, deliver a present at the third Greek bailout party.

Interstate 35 between San Antonio and Austin is congested, so obviously (to some people, at least) the solution is to run passenger trains between the two cities. Existing tracks are crowded with freight trains, so the Lone Star Rail District proposes to build a brand-new line for the freight trains and run passenger trains on the existing tracks. The total capital cost would be about $3 billion, up from just $0.6 billion in 2004 (which probably didn’t include the freight re-route).

Click image to download a PDF version of this map.

By coincidence, that was the projected capital cost for the proposed high-speed rail line between Tampa and Orlando (cancelled by Florida Governor Rick Scott), which are about the same 80-miles apart as Austin and San Antonio. But, despite the cost, Lone Star wouldn’t be a high-speed rail line. According to a 2004 feasibility study, trains would take about 90 minutes between the two cities, with two stops in between. While express trains with no stops would be a bit faster, cars driving at Texas speeds could still be faster.

Lone Star is asking the San Antonio city council for $500,000 to help pay for an environmental impact statement and other studies. Austin has supposedly already agreed to fund its share, though it isn’t in the city’s budget.

Lone Star is promising 32 trains (16 each way) carrying 20,000 riders (10,000 round trips) per day at fares of up to $12. That’s more than 600 riders per train; though some may not go the entire distance, it still seems high. Megabus currently operates three buses a day that take 85 minutes between the two cities at fares of $1.50 to $7.50. It seems likely that if there were 20,000 people per day wanting to pay $12 to take the trip at the same speed, Megabus would find them.

If the goal is to relieve congestion on I-35, two new lanes would probably cost less than a billion dollars and would be capable of moving far more vehicles per day than Lone Star would take off the road. Of course, the highway is probably not congested over the entire route, so two new lanes for the full length probably aren’t necessary. Besides, self-driving cars will probably go on sale and eliminate any need for passenger trains before the first Lone Star train would turn a wheel.

San Antonio Mayor Ivy Taylor, who famously cancelled the city’s even more backwards streetcar project, says that Lone Star isn’t one of her priorities. “There will be benefits from this alternative transit option, but we have to be good fiscal stewards,” she added. Local taxpayers should hope that she and the San Antonio city council can resist the starry-eyed Lone Star plan.

On Monday, Education Next released the results of its 2015 survey on education policy. Neal McCluskey already summarized the key findings, but I want to highlight one finding in particular: scholarship tax credits (STCs) are the most popular form of private educational choice. 

STCs received the support of 55 percent of respondents compared to somewhere between 47 percent and 51 percent for charter schools (depending on whether the survey first explained what charter schools are), 27 percent to 46 percent for universal school vouchers (again, depending on the wording of the question), and 34 percent to 41 percent for low-income vouchers. Unfortunately, the survey did not ask about education savings accounts.

Support for STCs was even higher among parents (57 percent), African-Americans (60 percent), and Hispanics (62 percent). This is not surprising since minorities are more likely to be low-income and therefore choice deprived. Those voicing support for STCs more than doubled those opposed in the general public (26 percent) and more than tripled the opposition among African-Americans (16 percent) and Hispanics (18 percent).

Previous Education Next surveys–as well as the Friedman Foundation’s survey last year–also found the most support for STCs among school choice policies. 

Support for STCs dipped slightly from a high of 60 percent last year, but it is still higher than any other year since Education Next first started asking the question in 2009. (They did not ask about STCs in 2013.) However, the poll also revealed the second highest level of opposition since 2009.

In the Friedman Foundation’s 2015 survey, released in July, scholarship tax credits, school vouchers, and education savings accounts all received high levels of support that were within the margin of error of each other when the question was prefaced with an explanation of how the policy worked:

  • Scholarship tax credits: 60 percent support, 29 percent opposition;
  • Education savings accounts: 62 percent support, 28 percent opposition;
  • School vouchers: 61 percent support, 33 percent opposition.

However, when not preceded by a prompt, only 39 percent of respondents supported school vouchers while 26 percent were opposed. (The other questions were only asked with an explanatory prompt because few Americans are familiar with STCs or ESAs.) Charter schools were the least popular with 53 percent in support and 27 percent opposed.

Encouragingly, support for STCs and ESAs in the Friedman poll was highest among Americans aged 18-34 with 72 percent and 75 percent support respectively. These results may well indicate a coming school choice tidal wave.

I’d have figured that the category of “Trump supporters who are aware of the Atlantic Monthly” would be an empty set, but it turns out there are at least 30 of them. Last week, in an open letter to Trump fans, the Atlantic’s Conor Friedersdorf asked  “why him?”, and yesterday, he published the results: “What Do Donald Trump Voters Actually Want?”

The funniest responses tend toward the nihilistic: “I really am at the point of letting the whole thing burn down and explode…. Like the joker from The Dark Knight, I just want to see the world burn”; or, “I just want to watch the chaos unfold …. I’m a young guy who is immature, a bit antisocial, and with no plans for kids or a wife ever. At some level, I don’t really care how things go with America as long as it’s fun to watch.” (Say what you want about the tenets of Trumpism: at least it’s not an ethos!)

But if watching things burn down and blow up is what you want out of politics, the other candidates may have a lot more to offer you—or so I argue in a column for the Federalist this week, “Trump’s Biggest Lie: ‘I’m The Most Militaristic Person’ In This Race.” That’s what Trump said upon his return to Fox News last week, and, even for the Donald, it’s a boast too far. The fact is, “in the 2016 election cycle, the ‘serious and responsible’ candidates for the presidency are so bellicose they make Trump look Cindy Sheehan.”

To take just a couple of examples from the piece, there’s:

Wisconsin governor Scott Walker, who in June, refused a reporter’s invitation to rule out “a full-blown re-invasion of Iraq,” and in July, announced that he’d “very possibly” need to start bombing Iran on his first day in office.

And there’s Florida senator Marco Rubio, who

stands out among his competitors as the sole Republican to argue that Obama’s real mistake in Libya was that he didn’t start bombing even sooner. Rubio wants to double down on the profligate interventionism of the George W. Bush era so badly that he’s built his campaign on B-movie slogans and neocon buzzwords. A Liam-Neeson-style “we will find you; and we will kill you” [is his] message to ISIS… and his website promises “A New American Century,” – a pledge that ought to give pause to anybody old enough to remember how that worked out in the last decade.

Even candidates with residual sympathy toward an earlier tradition of Republican realism have begun to toe the party line. Rand Paul has begun to sound distinctly hawkish lately, and Jeb Bush has decided it just “wouldn’t be prudent” to hire a foreign policy director who’s skeptical about bombing Iran.

Trump, on the other hand, seems determined to demonstrate his unseriousness by denouncing the Iraq War, saying he wouldn’t “rip up” the Iran deal, and complaining that America has become “the policeman of the world.”

Meanwhile, no one in this crowd can out-hawk Hillary Clinton, whose long, ghoulish career can be summed up in her own words, “I urged him to bomb.” “We came, we saw, he died,” is how HRC greeted the news that Colonel Qaddafi had been killed by a rebel mob. The best the Donald could do was brag about how this one time, he really “screwed” Qaddafi in a real estate deal. Wimp!

Look, don’t get me wrong: Trump is a boorish self-promoter—and worse, a literal “robber baron,”—the sort of guy who’d invoke eminent domain to try steal a retired widow’s house so he can use it for a limousine waiting area. The GOP should be embarrassed to have him leading the pack. But, “most militaristic”? Not by a long shot. As I argued in the Federalist, “on this issue, in this field, he’s not quite the embarrassment he should be.” Read the whole thing there.

The annual Education Next poll on school reform is out, and as always it’s boiling over with hot, tasty results. I won’t hit nearly everything in it, and even the topics I do cover can be dissected much further, but I have a few parts I want to highlight.

Common Core

Questions about the Common Core national curriculum standards have been my main focus in past EdNext polls, and they remain so this time around. The news isn’t good for the Core. Among respondents asked whether they support the Core, defined as standards states chose to adopt that “will be used to hold public schools accountable” – a description heavily biased with the promise of wonderful-sounding accountability – support has dropped from 65 percent in 2013 to 49 percent in 2015. Among teachers, the Core has donned its barrel and plunged from 76 percent support to 40 percent, with 50 percent now opposing it. Finally, getting rid of the accountability promise in the description resulted in just 39 percent of the public supporting the Core and 37 percent opposing, essentially a tie when margin of error is considered.

Federal Role

Questions about the federal role in education reveal what appear to be some serious inconsistencies. Unfortunately, 41 percent of the public thinks Washington should be in charge of “setting educational standards for what children should know,” while 43 percent think the states should be and 15 percent local governments. That means roughly 4 out of 10 people are ignoring the Constitution, as well as the federal government’s very poor track record. More encouraging, lower percentages of parents and teachers would have the feds lead on standards, and only about 1 in 5 members of the public think Washington should decide if “a school is failing” or “how to fix failing schools.” But get this: The poll also finds that 67 percent of the public thinks DC should require that all students “in grades 3-8 and once in high school” take math and reading tests. Oh, and allowing parents to opt their kids out of such tests? Only 26 percent of the public, and 32 percent of parents, support that. If there is a unifying theme here it may be that the public likes the abstract idea of national benchmarks but not centralized ramifications for performance, which we likely see reflected in the Common Core debate and No Child Left Behind reauthorization.


For the first time, the poll asked respondents to what degree various subjects were emphasized in their schools and how much they thought they should be emphasized. What that revealed is the public wants all subjects emphasized more except for athletics, which saw slight sentiment for de-emphasis. So more reading, math, arts, history, science, character education, creativity, bullying prevention and – yikes! – global warming? Yes please!

By the way, Jay Greene has some great thoughts on why character education has close to the biggest gulfs between what is desired and what is delivered, and he cites Cato’s Public Schooling Battle Map. Check out his post to see what I would have said (only not as well as he says it). And the same problem Greene discusses for character education likely applies to global warming, about which the pollsters found that Democrats want more emphasis and Republicans less. Maybe if we had school choice, far more people could get what they wanted on controversial topics like character education and climate change. And speaking of choice…

School Choice

Overall, like “that re-form,” people seem to like that school choice…maybe. Much depends on the type of choice, question wording, and whom you ask. When charter schools are described as schools that “are expected to meet promised objectives, but are exempt from state regulations,” 51 percent of the public supports them while 27 percent opposes. Getting rid of the description and just asking people if they “support or oppose the formation of charter schools” garners 47 percent support, 19 percent opposition (and a big increase in “neither support nor oppose”). For scholarship tax credits intended “to help low-income parents send their children to private schools,” 55 percent of the public is supportive, versus 26 percent in opposition. For essentially universal private school vouchers, 46 percent support the idea versus 36 percent opposing. Restrict vouchers to only low-income families, however, and support drops to 41 percent.  And, again, wording is important. When the question dropped a description of the goal of vouchers – to give low-income families “wider choice” – public support dropped to just 34 percent, with 49 percent opposing.  And when the wording was simply for a program “that would use government funds to pay the tuition of all students who choose to attend private schools,” only 27 percent were supportive and 58 percent were opposed. Perhaps the public favors giving people more choice, but doesn’t like giving out taxpayer money for existing choices that people may think are predominantly made by fat cats at very expensive schools.

African Americans and Hispanics support choice far more than whites, which is not surprising given years of previous polling and minorities tending to be in schools that see worse outcomes. 62 percent of Hispanics and 60 percent of African Americans support scholarship tax credits for low-income students, versus 53 percent of whites. For “wider choice” universal vouchers, 65 percent of Hispanics and 58 percent of African Americans are supportive, versus 40 percent of whites. For low-income vouchers with the “wider-choice” description, 59 percent of Hispanics are supportive as are 66 percent of African Americans, but just 33 percent of whites. For low-income vouchers without the “wider-choice” description, 50 percent of Hispanics are supportive, as are 42 percent of African Americans and just 30 percent of whites.  Finally, 45 percent of African Americans, 34 percent of Hispanics, and a mere 22 percent of whites support using “government funds to pay the tuition of all students who choose to attend private schools.” Clearly, minority families are much more likely to support private school choice than are whites.

Much More!

In addition to these topics, the poll furnishes fascinating insights on topics including “disparate impact” discipline, teacher tenure, and public schools funding. So why are you still here? Go read it!

You Ought to Have a Look is a feature from the Center for the Study of Science posted by Patrick J. Michaels and Paul C. (“Chip”) Knappenberger.  While this section will feature all of the areas of interest that we are emphasizing, the prominence of the climate issue is driving a tremendous amount of web traffic. Here we post a few of the best in recent days, along with our color commentary.

We’ll start out with one of the best quotes we’ve come across in recent memory. It’s from the inimitable Matt Ridley in his piece, “The Green Scare Problem” from the Wall Street Journal last week:

Making dire predictions is what environmental groups do for a living, and it’s a competitive market, so they exaggerate.

Ridley goes on to describe a growingly familiar list of now-failed environmental apocalypses that had been, at one point in time, predicted to befall us—pesticides, ozone hole, acid rain, GMOs, etc. Climate change calamity, as is being pushed by President Obama and the EPA to justify their ever-expanding restrictions of our carbon dioxide emissions, is the latest addition to Ridley’s list. Ridley’s main point is that the “we’re doomed if we don’t do what the environmental pressure groups tell us, and saved if we do” push “has frequently turned out to be really bad advice.” Ridley foresees more of the same from Obama’s Clean Power. We’re inclined to agree.

Be sure to check out Matt’s full column in which he backs up his opinions. It well worth the time spent reading.

When it comes to selling the Clean Power Plan, President Obama and his EPA go to such extreme lengths that they run up against (and often exceed) the bounds of sound science. We’ve addressed many of these transgressions. Climate impact of the Plan? Zilch. Health impacts from the Plan. Non-existent. Economic stimulus of the Plan? Negative. Validity of calling “carbon dioxide emissions” “carbon pollution”? None.

To expand a bit upon the latter, we tracked the historical usage of the phrases “carbon dioxide emissions” and “carbon pollution” in press releases issued by the EPA since 1994. “Carbon dioxide emissions” is the scientifically appropriate description of well, carbon dioxide emissions, while “carbon pollution” is grossly inaccurate and, well, deceptive. Our figure tracks how the EPA has moved away from science and towards propaganda in recent years, no doubt, in concert with the President and his push for limits to carbon dioxide emissions under his Climate Action Plan announced in 2013 (and telegraphed years earlier).


Figure 1. Number of press releases each year since 1994 (through August 11, 2015) issued by the U.S. Environmental Protection Agency which contained either the phrase “carbon dioxide emissions” or “carbon pollution.”

When a straight up telling of the situation fails to impress, try dressing it up with something a bit scarier-sounding.

And finally, if the Obama Administration isn’t going to have its hands full dealing with challenges by states and industries who are opposed to the Clean Power Plan for myriad reasons, it’ll also have to defend itself against a lawsuit from a group of youths who think that the Clean Power Plan doesn’t go far enough:

They are asking for a court order to force Obama to immediately implement a national plan to decrease atmospheric concentrations of carbon dioxide to 350 parts per million – a level many scientists agree is the highest safe concentration permissible – by the end of this century. The concentration of carbon dioxide in the atmosphere has already hit 400 parts per million.

“It’s really important that the court step in and do their jobs when there’s such intense violation of constitutional rights happening,” [Julia] Olson [lead council on the case] said.

Nothing like a lawsuit that is suing for the impossible!

Today we’ve released The Human Freedom Index, a new report that presents a broad measure of personal, civil, and economic freedom around the world. It is co-published by the Cato Institute, the Fraser Institute (Canada) and the Liberales Institut (Germany), and is the most comprehensive index on freedom yet created for a globally meaningful set of countries.

My co-author Tanja Porcnik and I look at 76 indicators in 152 countries to capture the degree to which people are free to engage in voluntary exchange and enjoy major liberties such as freedom of speech, religion, and association. We also include measures on freedom of movement, women’s freedoms, safety and security, and rule of law. We use data from 2008 to 2012, the most recent year for which sufficient data is available.

Hong Kong and Switzerland top the rankings, followed in order by Finland, Denmark, New Zealand, and Canada. The United States ranks in 20th place, below the United Kingdom (9) and Chile (18). Other countries rank as follows: Singapore (43), India (75), Russia (111), China (132), Venezuela (144), and Zimbabwe (149).

The United States fell from 17th place in 2008 to 20th place in 2012. The decline reflects a long-term drop in every category of economic freedom and in its rule of law indicators. The U.S. performance is worrisome and shows that the United States can no longer claim to be the leading bastion of liberty in the world. In addition to the expansion of the regulatory state and drop in economic freedom, the war on terror, the war on drugs, and the erosion of property rights due to greater use of eminent domain all likely have contributed to the U.S. decline.

We do not measure democracy in the index, though we consider it important. Indeed, we find a strong relationship between human freedom and democracy, a link that merits further study. As such, Hong Kong is an outlier in our index. Its high ranking is due to its traditionally strong rule of law, and high levels of both personal and economic freedom, something that all advocates of freedom, including democracy advocates, should seek to protect. The danger there is that China’s efforts to limit democracy will lead to increasing interference in the territory’s institutions—including on the independence of its legal system and the freedom of its press—which will reduce its overall freedom.

We believe that freedom is inherently valuable and plays a central role in human progress. As the graph above shows, belonging to the freest countries in the world greatly improves the average person’s income. Read the study here to see our other findings, the data, and other goals of the research.

Jeb Bush has amassed a sizable war chest and positioned himself to be the safe establishment pick after Donald Trump’s expected implosion. Alas, on foreign policy Bush has turned hard right.

“Our security,” he recently claimed, is “in the balance.” Yet the U.S. continues to dominate the globe as no other nation before it.

Moreover, Bush contended, “if we withdraw from the defense of liberty elsewhere, the battle of eventually comes to us anyway.” Actually, the world long has been filled with horror which Washington has successfully avoided.

Bush followed the Republican stereotype in demanding more military spending. “We are in the seventh year of a significant dismantling of our own military,” he falsely claimed. Real spending continued to increase until 2012.

In Bush’s view two and a half percent of GDP for the Pentagon is too low. But as Ronald Reagan observed, military spending should reflect the threat environment, which is vastly improved. Bush seemed to recognize this reality when he suggested a strategic review since “the world’s changed. I mean, we’re, the Soviets aren’t going to launch a tank attack across Eastern Germany into Germany.”

Very true. He should launch a strategic review first, which would suggest fewer defense responsibilities and thus lower military outlays.

Bush first called his brother’s policy in Iraq “a mistake.” More recently, however, he declared that ousting Saddam Hussein was a “pretty good deal.”

Maybe so, I pointed out in Forbes, “if you don’t count dead Americans, dead allied personnel, dead Iraqis, widespread sectarian violence, mass refugee flows, increased Iranian influence, regional instability, and the rise of the Islamic State.”

Bush misleadingly argued that ISIS “didn’t exist when my brother was president” and that a continued U.S. military presence “would not have allowed” the group to flourish. This is false.

ISIS is an outgrowth of al-Qaeda in Iraq, which developed in response to George W.’s invasion. The group grew in opposition to the U.S. occupation and Shia-majority regime installed by Washington.

Alas, the famed “surge” did not foster sectarian reconciliation, as intended. ISIS exploded when the Sunni Awakening went into reverse in response oppressive sectarian policies begun by the Iraqi government under George W., who also failed to win approval of a status of forces agreement and continued U.S. military presence. Obama only followed the Bush timetable.

Nor would a continuing presence of U.S. troops have achieved much, unless augmented and used in continuing anti-insurgency operations—contrary to the fervent desire of most Americans. And maintaining the military occupation would have provided a target for radicals of every sectarian viewpoint.

Nevertheless, Jeb urged a new war dedicated to “throwing back the barbarians of ISIS, and helping the millions in the region who want to live in peace.” Actually, those millions, rather than Americans, should fight ISIS.

Even scarier, Bush proposed that Washington join Syria’s civil war. He urged “a coordinated, international effort” to strengthen increasingly ineffective moderate forces. Worse, Bush advocated not only a “no-fly zone” but “multiple safe zones,” which would require substantial and sustained U.S. military involvement.

He complained that the administration didn’t deal with Iran’s malignant regional behavior. True, because Washington focused on the far more important issue of preventing Iran from acquiring nuclear weapons.

Bush advocated additional sanctions, which would not have been matched by other nations. He also recommended that Washington support the Iranian opposition, as if the Islamist regime would allow increased international interference promoting its ouster.

Bush contended that America’s “alliances need rebuilding.” Which means increasing subsidies for rich industrialized states, which are capable of defending themselves. Bush also believes in placating authoritarian governments—Egypt, Saudi Arabia, and others. So much for democracy and liberty.
Finally, like other Republican presidential wannabes, Bush is oblivious to the consequences of U.S. policy. Droning, bombing, invading, and occupying other nations create blowback. While Washington’s behavior doesn’t justify terrorism, promiscuous intervention helps explain it.

Americans can’t afford a rerun of Dubya’s disastrous presidency.

The whole point of the Supreme Court’s decision in Wal-Mart Stores, Inc. v. Dukes was to put an end to “trial by formula” class actions that stack the deck against defendants. Lower courts, unfortunately, haven’t gotten the message. And that is a serious threat to defendants’ due process rights. Fortunately, the Supreme Court will return to the issue next term in Tyson Foods, Inc. v. Bouaphakeo.

There is a whiff of parody to the case. The plaintiff class consists of about 1,300 workers at Tyson’s Storm Lake, Iowa, pork-processing plant who say that Tyson failed to compensate them for the overtime that they spent putting on and taking off protective gear before and after their shifts. The class was certified as presenting “common” fact questions despite that the  plant has some 420 job classifications, each of which has different protective requirements, not to mention that Tyson provides additional gear that employees may choose to wear—so even workers in the same department or at the same position may wind up wearing different equipment.

Logically, one would expect the plaintiffs to present evidence of the amount of time that they each spent putting on and taking off gear, compare that to the work and pay records kept by Tyson, and then show that they weren’t properly compensated for any time they worked over 40 hours in a given week, which the Fair Labor Standards Act sets as the trigger for overtime. After all, that’s how it would work in an individual suit.

But that’s nothing like what happened here.

Rather than put on evidence of individual employees’ changing times, an expert for the plaintiffs measured several workers, whose changing times ranged from a few seconds to ten minutes—reflecting what even the expert acknowledged was “a lot of variation.” No matter, the expert averaged everything out, added in a few minutes to account for various factors, and arrived at “average” changing times of 18 minutes for “processing” workers and 21.25 for “slaughter” workers. At this point, a second expert added those averages to individual employees’ time records, identified weeks in which workers were due overtime pay, and then calculated damages, arriving at a class-wide figure of over $6 million in unpaid overtime wages. But as the second expert conceded, that figure was very sensitive to changes in the averages; reduce them by just a small amount, and hundreds of workers drop out of the class altogether, because their time drops below 40 hours for every week or they were already adequately compensated for any overtime. Indeed, although the jury ultimately found for the employees, it didn’t buy the average times and reduced the damages award to less than $3 million.

In case that’s not clear: based on the plaintiffs’ formula evidence, the jury necessarily believes that a substantial number of class members suffered no injury at all. Yet as class members, they’ll still receive damages—at the expense of other workers who might actually have been underpaid. So the jury verdict is incoherent, but you can’t really blame the jury: the class itself is the real problem, throwing together workers with so many different kinds of jobs and such different circumstances that there aren’t any truly common fact questions among them. Meanwhile, due to the use of common, formula-based evidence, Tyson was denied any ability to challenge its liability to and the damages of individual class members, only the plaintiffs’ formula. Even with most of its defenses off the table, Tyson’s challenge to the formula was mostly successful. Absent the formula, it’s possible that Tyson might have prevailed on many individual claims or even all of them—there’s no way to know.

That’s not how class actions are supposed to work. Rule 23, which sets the procedure for class actions, is a procedural device and is not supposed to alter the substantive rights of plaintiffs or defendants. In particular, that means that a class action can’t be used as a shortcut by “extrapolating” damages and liability based on a formula. The Court explained in Dukes that this requires that plaintiffs’ claims turn on a common contention “that it is capable of classwide resolution—which means that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.” (For example, a common issue in a product-liability class action might be whether a given product was defectively designed.) When that requirement is loosened, the result is trial by formula, as individual issues are decided based on class-wide evidence, whether or not that evidence says anything at all about particular class members’ claims. The quaint notion of having to support legal claims with probative evidence goes out the window. Relieving plaintiffs of the burden of proving their cases is, needless to say, something more than merely “procedural.”

Trial by formula not only violates Rule 23 and its statutory basis, the Rules Enabling Act, but also raises serious due process concerns. “Due process requires that there be an opportunity to present every available defense,” the Supreme Court has explained. It follows that “[a] defendant in a class action has a due process right to raise individual challenges and defenses to claims, and a class action cannot be certified in a way that eviscerates this right or masks individual issues.” When aggregate litigation procedures abridge a defendant’s ability to mount the same defenses that it could bring in individual suits, something is seriously wrong.

The Court needs to make clear that trial by formula is off-limits, whether a case is brought as a class action or as a “collective action” under the Fair Labor Standards Act or a combination of the two. Defendants have a right to defend themselves, and that’s possible only when a class action satisfies Dukes’s “one stroke” rule. That’s as true in FLSA wage and hour cases—which many of the lower courts seem to believe are an exception to due process requirements—as in any other. Skipping past that requirement offends fundamental principles of justice and perverts the substantive law being enforced by extending liability to persons and circumstances that Congress never intended. 

That’s the question Dave Weigel asks at the Washington Post. His premise is that Rand Paul’s presidential campaign seems to have slowed down, so maybe that means any “libertarian moment” has passed. (I’d say Weigel asks, but doesn’t answer, the question.)

Nick Gillespie of Reason correctly tells Weigel that ideological movements and moments aren’t tied to any one political leader: “It’s a mistake to conflate Rand Paul’s electoral success with that of the libertarian moment.”

Gillespie also says Paul would be more successful if he were more libertarian:

“Rand Paul’s high visibility is better understood as a consequence of the libertarian moment than its cause. There’s a reason why he’s been at his most electrifying and popular precisely when he is at his most libertarian: calling out the surveillance state, for instance, and leading the charge against reckless interventions in Syria and Libya.”…

“Hopefully his father’s endorsement will goad him to become THE libertarian alternative,” says Gillespie, “rather than the seventh or eighth or 10th most conservative candidate in the GOP race.”

And of course the election is just beginning. The Donald Trump circus has dominated the past month, but eventually the differences between serious candidates such as Bush, Walker, and Paul will get more attention. And in that competition Paul’s “libertarianish” approach will stand out against a dozen candidates racing to the right.  

Weigel isn’t the first to raise the question of whether the rise of ISIS, with its brutal videos, set back a rising tide of non-interventionist sentiment among American voters. As I told Weigel, “I still think the growing aversion to intervention will reassert itself reasonably soon.” The temporary success of ISIS won’t wipe out 15 years of war-weariness. As soon as February, when the voting starts, voters may be reverting to their skepticism about intervention.   Ed Crane has written, in the Wall Street Journal and elsewhere, that a plurality of Americans support free enterprise, social tolerance, and “a healthy skepticism of foreign military adventurism.” David Brooks wrote recently that the swing voters in 2016 will be people who don’t think big government is the path to economic growth and don’t know why a presidential candidate would open his campaign at Jerry Falwell’s university. Those are the voters who push American politics in a libertarian direction.   You can see that libertarian direction in this chart put together by David Bier, who elaborated on what it shows here:   In any case, we shouldn’t judge freedom by what politicians and voters are doing in any particular year. We live in a world where we have extended the promises of the Declaration of Independence to more people – gay people can get married! – where we have all the knowledge in the history of the world in our pockets, where politicians and police are increasingly monitored, where unregulated or lightly regulated technologies are challenging comfortable monopolies.    Nick Gillespie and Matt Welch have taken the idea of “the libertarian moment” far beyond politics and elections, as in this article that I quoted in the introduction to The Libertarian Reader: We are in fact living at the cusp of what should be called the Libertarian Moment, the dawning not of some fabled, clichéd, and loosey-goosey Age of Aquarius but a time of increasingly hyper-individualized, hyper-expanded choice over every aspect of our lives, from 401(k)s to hot and cold running coffee drinks, from life-saving pharmaceuticals to online dating services. This is now a world where it’s more possible than ever to live your life on your own terms; it’s an early rough draft version of the libertarian philosopher Robert Nozick’s glimmering “utopia of utopias.” Due to exponential advances in technology, broad-based increases in wealth, the ongoing networking of the world via trade and culture, and the decline of both state and private institutions of repression, never before has it been easier for more individuals to chart their own course and steer their lives by the stars as they see the sky….   This new century of the individual, which makes the Me Decade look positively communitarian in comparison, will have far-reaching implications wherever individuals swarm together in commerce, culture, or politics….   The Internet alone has created entire new economies, modes of scattered and decentralized organization and work, and a hyper-individualization that would have shocked the Founding Fathers. And of course if we move beyond the United States to the world, it’s pretty clear that the large trends in the world – not without counter-trends – are toward human rights, women’s rights, gay rights, democratic governance, and freer markets. If we’re not quite in a libertarian moment, we’re in a libertarianish era.

Donald Trump’s newly released position paper on immigration is the precise mix of fantasy and ignorance that one has come to expect from the recently self-described Republican.  Specifically, his position paper reads like an outline of this April op-ed by Senator Jeff Sessions (R-AL).  Trump is still a candidate in the GOP primary supported mainly by older white men who are not particularly conservative.  Although the electorate has never been more supportive of expanding legal immigration, Trump has never been more opposed.

Trump’s position paper attempts to lay the foundation for his immigration policy as president. Below, I review how his ideas measure up. Quotes from his paper are in quotes, my responses follow.

Here are the three core principles of real immigration reform:

  1. A nation without borders is not a nation. There must be a wall across the southern border.
  2. A nation without laws is not a nation. Laws passed in accordance with our Constitutional system of government must be enforced.
  3. A nation that does not serve its own citizens is not a nation. Any immigration plan must improve jobs, wages and security for all Americans.

The first sentence is true by definition, but assumes that for a border to be real, it must have a wall around it. Whether a wall is warranted should depend on the circumstances at the border, which are vastly more safe than Trump claims. 

The last two principles are vague enough that they could support any immigration policy from a total ban on immigration to open borders. The rest of his position paper narrows their focus.

U.S. taxpayers have been asked to pick up hundreds of billions in healthcare costs, housing costs, education costs, welfare costs, etc. Indeed, the annual cost of free tax credits alone paid to illegal immigrants quadrupled to $4.2 billion in 2011.

This analysis factors in only fiscal costs, which will always lead to negative fiscal outcomes. It ignores the fiscal benefits that come from a larger economy.  The fact remains that poor immigrants use less welfare than poor Americans.  They contribute mightily to Social Security, Medicare, and other portions of the U.S budget.  Over time, immigration’s impact on the U.S. taxpayer is about a net-zero.  In other words, immigrants and their descendants pay for themselves. 

Immigration can turn fiscally positive by further restricting welfare access.  Right now illegal immigrants do not have access to means tested welfare programs, but their American born children do.  However, their benefit levels are adjusted downwards to account for the non-eligible members of their households.  Short of lowering welfare benefit levels for everybody, which would be a positive move, the government cannot deny citizens access based on who their parents are.  However, Congress can deny all non-citizens access to welfare.  Cato has published the only guide of how to do that. Removing the Earned Income Tax Credit for unauthorized or other categories of non-citizens would also be easy.

The position paper doesn’t factor in the estimated $400 to $600 billion government cost of removing all unauthorized immigrants as well as the lost tax revenue from the subsequently smaller economy.  Doing so reveals how fiscally damaging this immigration plan would be if it ever became law. 

The effects on jobseekers have also been disastrous …

The influx of foreign workers holds down salaries, keeps unemployment high, and makes it difficult for poor and working class Americans – including immigrants themselves and their children – to earn a middle class wage.

There is a lot of research on whether immigrants displace Americans in the job market – and the general finding is that immigrants displace very few American workers. 

David Card and John DiNardo looked at native responses to immigration in American cities to test the so-called “skating rink” model of native location decisions that assumes each new immigrant knocks an American out of the workforce.  If the skating rink model is correct, natives with skills similar to immigrants should vacate areas where immigrants move to and not move to areas where immigrants are residing.  Instead they found that an increase of the immigrant population in specific skill groups leads to small increases in the population of native-born individuals in the same skill group.  Immigrant-induced changes in the local economy, such as the creation of new businesses and new types of industries, creates enough new jobs to make up for any displacement of native workers. 

Another paper by Card did not find any change in native mobility due to immigration, but he discovered negative wage effects for some skill sets.  However, he also found that inflows “reduced the relative employment rates of natives and earlier immigrants in laborer and low-skilled service occupations by up to 1 percentage point, and by up to 3 percentage points in very high-immigrant cities like Los Angeles or Miami” (emphasis added). 

Card’s findings in his second paper are consistent with the later findings of Gianmarco Ottaviano and Giovanni Peri that newer immigrants compete with the immigrants who preceded them, not with native-born Americans who have similar skills.  The labor market effects of new immigrants appear to fall most heavily on immigrants who preceded them, not Americans, which would seem to cut against the theory that immigrants have a large negative effect on American workers.  In other words, immigrants don’t compete against Americans, they only compete against other immigrants. 

Even then, Card and Ethan Lewis looked at how new Mexican immigrants displaced older Mexican immigrants and found decidedly small effects. Only in Los Angeles and El Paso, TX did new Mexicans push out older Mexicans.  In all of the other cities they examined, new Mexican immigrants complemented the existing Mexican immigrant workforce rather than displaced it.  The U.S. economy is very good at attracting Mexican immigrants, providing incentives for them to settle in areas where they are most demanded, and responding in ways that increase net production and employment.

paper by George Borjas seems to find the greatest effect of immigration on the wages of native-born American workers, a wage elasticity of –0.39.  Borjas’s finding has been criticized by many, including in this recent paper that extended his period of analysis by 10 years but found only a –0.2 wage elasticity as well as other potential problems with his methods.  Another paper by Peri and Chad Sparber also questioned Borjas’s paper, finding that less educated immigrant workers and native born workers specialize in different tasks, thus inducing natives to reallocate their task supply, thereby reducing downward wage pressure.  Foreign-born workers specialized in occupations that required manual labor and physical skills while natives pursued jobs that required more intensive communication and language skills. Immigration induces natives to specialize accordingly, reducing the negative wage effect of immigration by roughly 75 percent.  In other words, natives do not react to immigration by leaving the workforce or moving to different areas, but by changing their skill sets and occupations. 

If immigrants compete most with anybody, they compete with teenagers.  However, a Chicago Fed Letter and research paper authored by Daniel Aaronson, Kyung-Hong Park, and Daniel Sullivan discovered that teens have declining labor force participation rates for reasons other than immigration like an increase in the relative benefits of education versus work, government financial incentives for schooling, merit-based scholarships with minimum grade requirements, and education grants.  In other words, teens allocated their scarce time to education and away from work to increase their investment in acquiring human capital and, hence, a higher future income.  Low-skilled immigration and stiffer labor market competition was not a compelling explanation for their decline in labor force participation.  

Another report by the U.S. Bureau of Labor Statistics in 2002 echoed the findings of Aaronson, Park, and Sullivan when it concluded that teen Labor Force Participate Rates dropped because they were more likely to be enrolled in school. Competition with immigrants didn’t push them out of the labor market.

Patricia Cortes does find some displacement effects across cities.  These effects are not large enough to equalize wages across the country, and thus not large enough to induce the displacement of one American worker for each immigrant worker.  Cortes found that three natives move out of a city for every 10 immigrants who move in. 

Over the last 20 years, immigrants occupy about as many jobs in the economy as their percentage of the working age population would predict.

These academic papers do not produce a compelling reason to believe that immigrants displace native-born workers in large numbers nor that they lower American wages.  There is likely some job displacement or wage effects caused by immigration, but the effect is small compared to the benefits they provide.

The impact in terms of crime has been tragic. In recent weeks, the headlines have been covered with cases of criminals who crossed our border illegally only to go on to commit horrific crimes against Americans. Most recently, an illegal immigrant from Mexico, with a long arrest record, is charged with breaking into a 64 year-old women’s home, crushing her skull and eye sockets with a hammer, raping her, and murdering her. The Police Chief in Santa Maria says the “blood trail” leads straight to Washington.

Some immigrants do commit heinous crimes.  Our immigration enforcement system should be almost entirely focused on removing actual security and criminal threats rather than being concerned with regulating the labor market.  However, immigrants are less likely than natives to commit crimes or be incarcerated for them.  Please read this detailed literature review for more information. 

The cost of building a permanent border wall pales mightily in comparison to what American taxpayers spend every single year on dealing with the fallout of illegal immigration on their communities, schools and unemployment offices.

Building a border wall won’t solve any of the problems that Trump describes.  First, border apprehensions are near their post-1970 historical low point.  Second about 42 percent of unauthorized immigrants entered legally and overstayed their visas.  A border wall won’t prevent them from entering.  Third, better border enforcement could actually increase the illegal immigrant population by locking them in the United States.  Illegal immigration was largely a circular phenomenon until the late 1980s when the United States increased border security.  Migrants would enter the country, work, and return home secure with the knowledge that they could return in the future again.  When border security was beefed up in the late 1980s, the costs of crossing the border increased so these migrants decided to stay instead of returning home.  When the migrants can’t go back and forth, their families come north.

Mexico must pay for the wall … 

No matter who writes the checks, we all pay for a border wall.  The decrease in economic activity caused by more regulation of labor markets required by this plan will make the United States, Mexico, and other countries poorer as a result. 

The purpose of building a wall would be to decrease illegal immigration, but a functional legal immigration system would be far more effective.  As I detail here, guest worker visas are the most effective way of halting unauthorized immigration because they provides a lawful pathway for low-skilled immigrants to enter instead of overstaying a visa, running across a desert, or being smuggled in.  A guest worker visa system will funnel peaceful migrant workers into the legal system leaving immigration enforcement to deal with a much smaller pool of unlawful immigrants. 

Congress did open up guest workers a bit in the 1950s, which ended up cutting unauthorized immigration by over 90 percent by creating a low-skilled guest worker visa called the Bracero Program.  That program later ended due to union pressure and controversies over poor treatment of some of the workers, causing unauthorized immigration to immediately skyrocket. The program was shut down after domestic unions, especially Cesar Chavez’s United Farm Workers, mounted a national campaign against it.

According to Stuart Anderson of the National Foundation for American Policy, a February 1958 Border Patrol document from the El Centro, California district states, “Should Public Law 78 [Bracero Program) be repealed or a restriction placed on the number of braceros allowed to enter the United States, we can look forward to a large increase in the number of illegal alien entrants into the United States.”  That is exactly what happened.

The government cannot regulate immigration if much of it is illegal.  Legalizing the flow of workers into the United States is a simple and cost-effective way to control the border and limit unlawful immigration.  The border was controlled in the past with many fewer government employees, it can happen again.      

Nationwide e-verify. This simple measure will protect jobs for unemployed Americans.

E-Verify is a failure.  Since 2008 Arizona, Mississippi, South Carolina, and Alabama have mandated it for all new hires in order to turn off the “jobs magnet” that attracts illegal immigrants.  However, the wages for illegal immigrants barely budged in those states (they would have to drop to weaken the jobs magnet). 

E-Verify doesn’t work for two main reasons.  The first is that E-Verify only identifies unlawful workers about half of the time.  That means half of unlawful workers get hired lawfully when using E-Verify.  The second is that only about half of employers in states where it is mandated actually use it.  If Arizona, Mississippi, South Carolina, and Alabama cannot make E-Verify an effective immigration enforcement tool in their states then it will fail when mandated nationally.   

E-Verify is a fancy-sounding immigration enforcement tool but it simply does not work.  The only thing worse than a mandated E-Verify program that doesn’t work, as Trump proposes, is one that does work.  We can at least be thankful that E-Verify fails otherwise it will do a lot more harm to the labor market.

End birthright citizenship. This remains the biggest magnet for illegal immigration. By a 2:1 margin, voters say it’s the wrong policy, including Harry Reid who said “no sane country” would give automatic citizenship to the children of illegal immigrants.

Most agree, with the exception of Judge Richard Posner, that a Constitutional amendment would be necessary to overturn birthright citizenship. 

Legalities aside, removing birthright citizenship would severely affect assimilation of immigrants in subsequent generations.  The U.S. rule of birthright citizenship is in stark contrast to policies pursued in Germany and Japan, where the children of immigrants were denied citizenship.  Below I summarize some work from here.

The lack of birthright citizenship created a legal underclass of resentful and displaced youth who were officially discriminated against in the government-run education system and had tenuous allegiance to the nation in which they were born.  After four generations in Japan, ethnic Koreans still self-identify as foreign.  In both countries, these noncitizen youths are more prone to crime and extreme political ideologies like communism or Islamism.

Youths born to noncitizen immigrants in nations without birthright citizenship have little legal stake in the nations they were born in but also have no place to go.  Many might gain citizenship through the ethnicity of their parents in Korea or Turkey, but with no connections to those nations, citizenship there is meaningless.

In the U.S., by contrast, children of immigrants are legally on the same playing field as children born to American citizens.  Both can serve in the military, purchase firearms, serve on juries, and be treated the same by the legal system.  That is one reason why 89 percent of second-generation Hispanics and 96 percent of third-generation Hispanics have described themselves as American only.  “Hispanic-American” or “Mexican-American” is still popular after several generations, just as “Italian-American” still survives, but these Americans do not view themselves as foreigners.  Removing birthright citizenship would end this successful assimilation trend.

Every year, we voluntarily admit another 2 million new immigrants, guest workers, refugees, and dependents, growing our existing all-time historic record population of 42 million immigrants. 

About 13 percent of America’s population is foreign born, below the all time peak of 14.7 percent in 1910.  The average percent of the population that was foreign born between 1860 and 1920 was about 14 percent – higher than it is today.  As a percentage of the U.S.-born population, yearly immigrant flows to the U.S. are half of what they were during the 19th century and early 20th centuries.  As a percentage of the U.S. population, this is not a historical high point. 

Other countries that weathered the Great Recession well like Canada, Australia, and Switzerland all let in far more immigrants as a percentage of their population every year and have far larger immigrant populations than the United States.  Switzerland, for instance, lets in about five times as many immigrants as the U.S. does every year as a percentage of their population.  The percent of the U.S. population that is foreign born is also below the OECD average.  In and of itself, that is not an argument for opening lawful immigration, but it should damper the notion that the U.S. has the most immigrant friendly policies in the world.  The numerical numbers of immigrants who come here yearly is large, about the same annual number as a hundred years ago, the U.S. has the third largest population in the world to absorb them.     

Increase prevailing wage for H-1Bs. We graduate two times more Americans with STEM degrees each year than find STEM jobs, yet as much as two-thirds of entry-level hiring for IT jobs is accomplished through the H-1B program. More than half of H-1B visas are issued for the program’s lowest allowable wage level, and more than eighty percent for its bottom two. Raising the prevailing wage paid to H-1Bs will force companies to give these coveted entry-level jobs to the existing domestic pool of unemployed native and immigrant workers in the U.S., instead of flying in cheaper workers from overseas. This will improve the number of black, Hispanic and female workers in Silicon Valley who have been passed over in favor of the H-1B program.

There are 85,000 annual slots available for H-1B workers.  This year they were all taken up in about a week.  New wage regulations would have to be extreme to decrease the number of H-1B visas admitted.  Creating them would slash the well-known economic benefits of skilled immigration.

If Trump is concerned about the small number of cases where H-1B workers have been used to displace Americans, then he should support amending the H-1B program so that the workers are portable and able to change employers easily.  Currently it is very legally difficult for the workers to change their jobs making it possible for unscrupulous employers to exploit them and thus displace American workers.  Such a reform would be welcome regardless of the reasons for doing so.

Immigration moderation … This will help reverse women’s plummeting workplace participation rate, grow wages, and allow record immigration levels to subside to more moderate historical averages.

It’s simply not true that closing the border will increase real wages for Americans.  Immigrants increase the size of the economy, create employment opportunities that in turn increases demand for labor, and make the United States a wealthier country.  Removing millions of people from the United States and preventing others from coming is a path toward slower economic growth, not prosperity. 

The purpose of moderating immigration is to get U.S. economic growth in line with the high growth era in the immediate post-World War II period.  But the United States did not have a shrinking or stagnant workforce from 1948 to 1973, the period of the greatest economic expansion and rising wages.  On the contrary, the U.S. workforce expanded rapidly during economic growth.  Merely decreasing the number of workers today by decreasing immigration will not replicate that period of economic growth. 

Furthermore, immigration was not as closed during that time period as many claim.  The Bracero guest-worker visa program let in nearly five million lower-skilled Mexican workers to temporarily labor in American agriculture.  The workforce grew in other ways too.  From 1948 to 1982, the size of the U.S. workforce practically doubled from 60 million to 111 million.  A baby-boom, women entering the workforce, and other internal migrations increased the number of workers.  The number of working women increased from 16.3 million in 1948 to 43.3 million in 1982 to 73 million in 2012.  The number of male workers shot up to from 43 million in 1948 to 76 million in 2012.  Female labor market gains did not take jobs away from men.  Those increases did not lead to massive unemployment or a drop in wages – which would be the result if increased labor scarcity is a path to prosperity.  There is not a fixed supply of jobs to be divided up amongst Americans: the market constantly creates and destroys new job opportunities and increasing supplies of workers and consumers help that process along.

Trump’s theory that the supply of workers is the prime determinant of wages ignores much.  Worker productivity is also influenced by the type and quantity of capital in the economy, the differences between immigrant workers and native-born workers, and the availability of technology.  In a well-functioning economy, increased supplies of workers increases demand for workers, which don’t lead to more unemployment. 


Donald Trump’s position paper on immigration is full of old anti-immigration arguments that have been repeated and rebutted numerous times.  These arguments were incorrect long before he wrote them here.  Trump’s position paper is a most similar to this op-ed by Senator Jeff Sessions (R-AL).  There is very little in it that is new – either as a policy prescription or as a justification.

It’s fire season again, which means we are once again treated to stories about how the Forest Service is running out of money and about how it all must be due to climate change. Both of these claims overlook fundamental points about fire policy and firefighting.

As of August 16, the BLM had spent $2.2 million controlling the 88,000-acre Cornet Fire on the Vale District in Oregon. The Forest Service has spent two-and-one-half times that much on a fire that was just 515 acres in size. BLM photo.

The Forest Service frets that rapidly rising firefighting costs are hurting the budgets of other Forest Service programs. However, as I’ve pointed out before, Forest Service firefighting costs have risen rapidly mainly because they can: the agency has a virtual blank check to spend on fire. As a result, the agency spends far more fighting fires than Department of the Interior agencies, which have never had a blank check.

For example, as of yesterday, the Bureau of Indian Affairs had spent $1.6 million controlling the 55,000-acre County Line 2 fire on the Warm Springs Indian Reservation in Oregon, while the Bureau of Land Management had spent $2.5 million controlling the 44,000-acre Bendire fire on its Vale District. Meanwhile, the Forest Service had spent $5.5 million on the 515-acre Baldy Fire on the Colville National Forest; $5.9 million on the 4,800-acre National Creek fire on the Rogue River National Forest; and $7.1 million on the 2,600-acre Phillips Creek fire on the Umatilla National Forest. These are selected examples, but on average, the Forest Service spends more than five times as much per acre than the Interior agencies.

We don’t yet have 2015 data, but for the past several years the Forest Service has spent about $4 on fire suppression for every dollar spent by the Department of the Interior even though it had fewer acres burn. As a result, over the past five years, it has spent an average of $914 per acre vs. $171 per acre spent by the Interior department.

To deal with rising fire suppression costs, Congress is continually thinking up schemes to give the Forest Service more money. That’s like trying to control a fire by pouring gasoline on it. The problem is not a shortage of funds, but too much money giving Forest Service firefighters no incentive to control costs. Costs will continue to rise until Congress figures this out and fixes the problem, possibly by turning firefighting over to the states and paying the states the same fixed annual amounts per acre that private forest land owners pay.

A comparison of firefighting costs with acres burned shows that there is little correlation: no matter how many acres burn, firefighting agencies (led by the Forest Service) spend about $1.5 billion to $1.9 billion per year. If this is increasing, it is not due to the severity of the fires but to loose spending by Congress.

The claims that growing wildfires are due to human-caused climate change are equally questionable. They are based on a recent study that compares fire trends since 1979. According to the Union of Concerned Scientists, the number of large fires per year has grown and the fire season has lengthened.

Despite all the concern over the drought, these claims aren’t borne out by the 2015 fire season. It is true that, as of August 14, more acres have burned this year than any year in the previous decade. What those numbers don’t show, however, is that 5.1 million of the 6.8 million acres burned as of yesterday were in Alaska.

One reason Alaska fires are so big is because no one spends much effort trying to control them. For example, the BLM spent a mere $2.8 million on fires that covered more than 400,000 acres near Ruby, Alaska.

Outside of Alaska, fires in the arid West are nowhere near record levels and may even be below average. As of yesterday, 173,000 acres had burned in the Southwest, compared with 2.0 million acres as of the same date in 2011 and 460,000 in 2008. About 350,000 acres in California had burned as of yesterday, compared with 1.2 million in 2008. About 220,000 acres had burned in the Pacific Northwest compared with more than 1.1 million in 2012.

Any fire study that only looks back as far as 1979 ignores huge fires that resulted from major droughts in earlier decades. The 1970s were one of the wettest decades on record, with an average of just 3 million acres a year burned. By comparison, there were 9 million acres of annual fires in the 1950s; 23 million in the 1940s; and 39 million in the 1930s. While there are some problems with data from those early decades, they are valid enough to show that recent changes in droughts and fires are due to cyclical variations in climate, not to human-caused warming.

Any look at fire data since 2000 must also take into account a major change in firefighting tactics. Before 2000, the Forest Service and other agencies put firefighters to work at fire edges to contain fires. Too many firefighters died, so now they start huge backfires thousands of feet, and perhaps miles, away from the wildfire fronts. As a result, fires are larger today, but only because a third or more of the acres burned were actually lit by firefighters.

Although it is eight years old, my policy analysis on wildfire is still valid today. The problem is not climate change and the solution is not to give firefighters more money. Instead, the problem is too much money and the solution is to treat the land near homes and other structures to make them defensible and then focus fire suppression efforts on nearby public lands mainly on making sure those fires don’t cross over onto private land.

In the “Agriculture” chapter of Cato’s 2012 Addendum to the federal government’s “Second National Assessment” of the effects of climate change on the United States, I wrote the following:

At a fundamental level, carbon dioxide is the basis of nearly all life on Earth, as it is the primary raw material or “food” that is utilized by plants to produce the organic matter out of which they construct their tissues…

Typically, a doubling of the air’s CO2 content above present-day concentrations raises the productivity of most herbaceous plants by about one-third; this positive response occurs in plants that utilize all three of the major biochemical pathways of photosynthesis.

There is no doubt elevated concentrations of atmospheric CO2 lead to enhanced plant photosynthesis and growth. This well-known fact has been confirmed over and over again in literally thousands of laboratory and field studies conducted by scientists over the past several decades. In recent years, however, the growth-enhancing benefits of atmospheric CO2 have been increasingly studied and observed in the real world of nature using Earth-orbiting satellites. Such instruments have the capability to remotely sense plant growth and vigor at altitudes miles above the Earth’s surface; and they have generated a spatial and temporal record of vegetative change that now spans more than three decades. And what has that record revealed?

The take-home message of the satellite data is two-fold. First, at the global level, all recent studies show there has been a significant greening of the planet over the past few decades despite the occurrence of a number of real (and imagined) assaults on Earth’s vegetation, including wildfires, disease, pest outbreaks, deforestation, and climatic changes in temperature and precipitation. Greening has more than compensated for any of the negative effects these phenomena may have had on the global biosphere during that time (Nemani et al., 2003; Young and Harris, 2005; Liu et al., 2010; De Jong et al., 2012; Eastman et al., 2013; Mao et al., 2013; Wu et al., 2014 ). Second, there is compelling evidence that the atmosphere’s rising CO2 content—which is considered by many to be the chief threat  to the future of the biosphere via climate change—is most likely the primary cause of the observed greening trends (Piao et al., 2006; De Jong et al., 2012; Andela et al., 2013; Donohue et al., 2013; Mao et al., 2013).

The observed CO2-induced greening of the Earth portends several obvious benefits for both society and nature. The increasing density and aerial coverage of vegetation, for example, helps to reduce the negative effects of soil erosion caused by the ravages of wind and rain. It also provides an increased source of food for both humanity and wild nature. Plant and animal biodiversity is also similarly stimulated, as vegetative productivity is highly correlated with biodiversity in natural habitats. And thanks to the recent work of Sedda et al. (2015), we now have another reason to celebrate CO2-induced greening—it is helping to reduce poverty in developing nations.

Noting that reducing rural and urban poverty in developing countries was a “key target” of the United Nations Millennium Development Goals of 1990-2015, Sedda et al. set out to conduct a study to determine if satellite-derived Normalized Difference Vegetation Index (NDVI) data could be used to evaluate the degree to which this specific goal may or may not have been achieved. Based on NDVI data they obtained for a large area of West Africa, the team of researchers found that “the intensity of poverty (and hence child mortality and nutrition) varies inversely with NDVI,” which findings, in their words, “highlight the utility of satellite-based metrics for poverty models including health and ecological components.”

Because of the very positive connection that exists between landscape greening and atmospheric CO2 enrichment, as discussed earlier, it is quite plausible—if not certain—that the historic and ongoing increase in the air’s CO2 concentration has played a significant role in the contemporaneous reduction in the portion of Earth’s human population that has lived under poverty conditions, which currently stands at 21%, and which Sedda et al. say is “a reduction from 33% in 2000 and 43% in 1990,” citing Ravallion (2012).

In light of these several observations, Sedda et al. conclude that since “the relative location of people in poverty and child mortality is dependent on the values of NDVI,” a simple “accounting for NDVI can reduce the number of indicators required to measure the intensity of poverty,” as well as to “improve the geographic targeting of pro-poor interventions,” as a part of “the upcoming United Nations Sustainable Development Goals framework.” Why on God’s getting-greener earth would the United Nations simultaneously work to reduce the anthropogenic CO2 emissions that are demonstrably raising standard of living for so many of the world’s poor?


Andela, N., Liu, Y.Y., van Dijk, A.I.J.M., de Jeu, R.A.M. and McVicar, T.R. 2013. Global changes in dryland vegetation dynamics (1988-2008) assessed by satellite remote sensing: comparing a new passive microwave vegetation density record with reflective greenness data. Biogeosciences 10: 6657-6676.

De Jong, R., Verbesselt, J., Schaepman, M.E. and De Bruin, S. 2012. Trend changes in global greening and browning: contribution of short-term trends to longer-term change. Global Change Biology 18: 642-655.

Donohue, R.J., Roderick, M.L., McVicar, T.R. and Farquhar, G.D. 2013. Impact of CO2 fertilization on maximum foliage cover across the globe’s warm, arid environments. Geophysical Research Letters 40: 3031-3035.

Eastman, J.R., Sangermano, F., Machado, E.A., Rogan, J. and Anyamba, A. 2013. Global trends in seasonality of Normalized Difference Vegetation Index (NDVI), 1982-2011. Remote Sensing 5: 4799-4818.

Liu, S., Liu, R. and Liu, Y. 2010. Spatial and temporal variation of global LAI during 1981-20006. Journal of Geographical Sciences 20: 323-332.

I’ve been warning for years of the dangers of the federal Racketeering Influenced and Corrupt Organizations law and how it gives prosecutors and enterprising private lawyers leverage to target above-board businesses in search of punishment or profit. Since the law’s passage in 1970, RICO has seldom been used against violent organized crime. Instead, it has been aimed at a wide array of white-collar defendants, as William Anderson noted in Regulation six years ago, and especially at unpopular industries like gun and cigarette makers, as Cato’s Bob Levy noted in 2000. The latest fillip is Sen. Sheldon Whitehouse’s proposal to aim racketeering charges against groups that promote wrongful thinking on climate change. The civil side of the statute (“civil RICO”), which can be used in private litigation, is especially susceptible to tactical use by private lawyers who know that the vagueness of the law, the high cost of response, the triple-damages provisions, and the racketeering stigma especially are useful in forcing adversaries to the bargaining table. The more those adversaries value respectability, the more powerful the leverage. 

Now comes word that a Washington, D.C.-based tough-on-crime group calling itself the Safe Streets Alliance has filed suit seeking, in its words, “to hold those involved with Colorado’s recreational marijuana industry liable under federal racketeering statute and to have Colorado marijuana business licenses held invalid.” Its press release is at least honest enough to acknowledge that the targets include “the citizens of Colorado” for what it believes was their faulty decision to enact Amendment 64 in 2012. In one case SSA, representing a local Holiday Inn franchisee that didn’t care to have a medical marijuana shop near its business, succeeded in forcing owner Jerry Olson (no relation) out of business. A key tactic in the suit – one quite familiar to those of us who follow hardball civil litigation in general – was to name as racketeering co-defendants a variety of risk-averse, often respectable businesses that had in some way done business with the main target. Thus AP reports

…just last week, a bonding company in Des Moines, Iowa, paid $50,000 to get out of the lawsuit.

“We are out of the business of bonding marijuana businesses in Colorado and elsewhere until this is settled politically,” said Therese Wielage, spokeswoman for Merchants Bonding Company Mutual.

Thus does the litigation accomplish its goal whether or not it ultimately prevails before a judge:

“This lawsuit is meant more to have a chilling effect on others than it is to benefit the plaintiffs,” said Adam Wolf, Olson’s lawyer.

SSA lawyer Brian Barnes of Cooper & Kirk doesn’t seem to contradict that: 

“We’re putting a bounty on the heads of anyone doing business with the marijuana industry,” Barnes said.

I’m occasionally asked why I bother to worry about the legal woes of unpopular industries whose goods I don’t even care to consume. A different way to look at the question is that almost anyone’s line of business – whether it be soft drinks or accounting or putting up visitors in one’s home or charitable non-profit work or electioneering or employing entry-level workers at minimum wage – is one public-vilification campaign, or one round of lawsuits, away from becoming an unpopular industry. 

The course of an economy is determined by the course of that economy’s money supply (broadly determined). The relationship between money growth and nominal GDP growth is presented in the accompanying chart. It is persuasive. Indeed, money, not fiscal policy, dominates.

As I listen to all the ad hoc conjectures about the state of China’s economy and its near-term prospects, I am astounded to never hear anything said about the most important determinant of nominal economic growth: the money supply. The second chart tells the tale. The picture is not a pretty one. China’s money supply growth rate has been slowing down since early 2012. It now is growing at an annual rate of about 10%, which is well below the trend rate of money growth: 17.06%. China is in trouble. Slower money supply growth means that slower nominal GDP growth is already baked in the cake.

Does three make a trend? I can’t recall hearing much discussion of legalizing prostitution in the recent past, and suddenly this week I’ve seen three significant reports in the media. Are they straws in the wind? Could the legalization of prostitution be the next social reform to come to the fore?

First, last Thursday the Telegraph reported on a new study from the venerable free-market think tank in London, the Institute for Economic Affairs:

The sex trade should be fully decriminalised because feminism has left modern men starved of sex, one of Baroness Thatcher’s favourirte think-tanks claims.

A controversial new paper published by the Institute of Economic Affairs (IEA) calls for Britain’s prostitution laws to be scrapped, insisting it is “inevitable” that men will resort to paying for sex as women become more empowered through participation in the workplace.

As IEA notes, the paper got plenty of publicity in the British media.

Then on Tuesday Amnesty International voted, as the New York Times put it, “to support a policy that calls for decriminalization of the sex trade, including prostitution, payment for sex and brothel ownership.” The full policy, which still requires final approval from the board, can be found here. The new policy

is based on the human rights principle that consensual sexual conduct between adults—which excludes acts that involve coercion, deception, threats, or violence—is entitled to protection from state interference (bearing in mind that legitimate restrictions may be imposed on sex work, as noted below).

And then today I see this in the Washington Post:

D.C. Council member David Grosso said he is considering introducing legislation this fall that would decriminalize prostitution in the city and provide sex workers with resources to be safe and get out of the business if they want to.

Grosso’s announcement comes on the heels of Amnesty International’s controversial recommendation Tuesday calling for “full decriminalization of all aspects of consensual sex work.”

“It is something that my staff and I have been working on and thinking about for a few months now,” Grosso (I-At Large) said Wednesday. “Once the Amnesty report came out, it validated a lot of the concerns that I have of how we handle this in the District.”

I’ve heard journalists say that three examples make a trend. So maybe we’ve just spotted one.

In my long years of interviews and speeches on libertarianism, I’ve often encountered people who think that libertarians’ main interests are legalizing drugs and prostitution. Indeed, libertarians – including the Cato Institute – have been talking about the harmful effects of the drug war for a long time. But I’ve actually seen very little libertarian scholarship or activism around the issue of prostitution. There’s been some, but it’s been nothing like a major topic of discussion. The only analysis I can find on the Cato website is this Cato Unbound symposium.

Whether libertarians have led the way or not, I am intrigued to see these three straws in the wind in such close proximity. Who’s next?

The myth that there’s no evidence that school choice works has more lives than Dracula. Worse, it’s often repeated by people who should know better, like the education wonks at Third Way or the ranking Democrat on the U.S. Senate education committee. In a particularly egregious recent example, a professor of educational leadership and the dean of the University of Wisconsin-Madison School of Education wrote an op-ed repeating the “no evidence” canard, among others:

The committee also expands the statewide voucher program. There is no evidence privatization [sic] results in better outcomes for kids. The result will be to pay the tuition for students who currently attend private school and who will continue to attend private school—their tuition will become the taxpayers’ bill rather than a private one. Additionally, the funds for the expansion would siphon an estimated $48 million away from public schools, decreasing the amount of money available for each and every school district in the state.

It is astounding that a professor and a dean at a school of education in Wisconsin would be unfamiliar with the research on the Milwaukee voucher program, never mind the numerous gold standard studies on school choice programs elsewhere. Fortunately, Professor James Shuls of the University of Missouri-St. Louis and Martin Lueken of the Wisconsin Institute for Law & Liberty set the record straight:

…the Wisconsin Legislature commissioned a comprehensive five-year study by researchers at the University of Arkansas. The research team matched and compared children at private schools in the choice program to similar students at Milwaukee Public Schools. The study concluded that children in Milwaukee who used vouchers were more likely to graduate from high school, enroll in four-year colleges and persist in college.

These findings are very similar to those of “gold-standard” studies done nationwide. Among 13 peer-reviewed studies on voucher programs that use research methods based on random assignment, all but one study concluded that vouchers benefit students (the other was unable to detect an impact). In addition, recent work by a Harvard economist demonstrates that giving low-income families better educational options can help improve social mobility for children.

Just a year and a half ago–in response to yet another school choice denier who should know better–the coauthors of the Milwaukee study clarified that their research found school choice produced “a modest but clearly positive effect on student outcomes.”

First, students participating in the Milwaukee Parental Choice (“voucher”) Program graduated from high school and both enrolled and persisted in four-year colleges at rates that were four to seven percentage points higher than a carefully matched set of students in Milwaukee Public Schools. Using the most conservative 4% voucher advantage from our study, that means that the 801 students in ninth grade in the voucher program in 2006 included 32 extra graduates who wouldn’t have completed high school and gone to college if they had instead been required to attend MPS.

Second, the addition of a high-stakes accountability testing requirement to the voucher program in 2010 resulted in a solid increase in voucher student test scores, leaving the voucher students with significantly higher achievement gains in reading than their matched MPS peers.

Moreover, as Shuls and Lueken note, “private schools in the choice program obtain these results when the government funding for a voucher is 60 percent less than what public schools receive.”

The final two claims by the UW-Madison faculty–that the voucher program benefits students who would attend private school anyway and siphons money from the district school system–also fail to withstand scrutiny. A conservative analysis of the Milwaukee voucher program by Prof. Robert Costrell of the University of Arkansas found that “about 10 percent of low-income voucher users would have attended private school anyway.” The 2009 study also found that the voucher program produced significant savings to the state taxpayers, as shown in the figure below:

Chart by Robert M. Costrell.

A Friedman Foundation study released last year found that the Milwaukee voucher program saved the state more than $238 million since its inception in 1990. Moreover, as the Wisconsin Institute for Law & Liberty notes in a recent report, Wisconsin gives a “school choice bonus” to district schools that lose students to the voucher program. Although a district’s total revenue decreases when a student leaves (along with the variable costs associated with that student), the “school districts will actually have more revenue per pupil because the district can continue to count students it no longer educates for equalization aid and revenue limit purposes.”

Sadly, opponents of school choice are likely to continue resurrecting the “no evidence” canard. But when they do, Van Helsings like Shuls and Lueken will be there to put a stake in its heart.

How much Australian sugar should be allowed to enter the U.S. market?  That’s a key question the U.S. government must answer prior to concluding the Trans-Pacific Partnership (TPP) negotiations.  The United States is the largest sugar market in the TPP, consuming about 11 million metric tons (MMT) per year.  It also is the largest producer (7-8 MMT) and importer (3 MMT) in the group.  Australia generally is believed to be the most cost-competitive sugar producer among the12 TPP nations.  It also is the largest exporter, annually shipping 3-4 MMT to other countries. 

To complicate matters further, sugar liberalization was explicitly excluded from the 2004 Australia-United States Free Trade Agreement (AUSFTA) due to U.S. political sensitivities.  Australian sugar producers understandably want to redress that omission.  Failure to obtain commercially meaningful access to the U.S. sugar market could lead to rejection of the pact by the Australian parliament.

The U.S. sugar program includes a price-support level for raw cane sugar of 22.25 cents per pound ($490/MT), with refined sugar supported at 26 cents.  Those levels effectively have been raised more than 10 percent to around 24.7 cents ($545/MT) and 30-32 cents, respectively, under the trade-restricting terms of the recent settlement agreement in the antidumping/countervailing-duty (AD/CVD) dispute involving imports from Mexico. (For more on U.S.-Mexico sugar issues, see here and here.)  Mexico is the largest supplier of U.S. sugar imports, generally providing between 1.0-1.5 MMT per year.  Suffice it to say that the agreement between the U.S. and Mexican governments will limit the amount of sugar Mexican producers can export to the United States, and also force that sugar to be sold at higher prices. 

With global raw sugar prices currently at relatively low levels of around 12 cents, Australian cane growers find the possibility of selling more sugar to the United States at high prices to be quite intriguing.  However, those sales currently are limited to the amount allocated to Australia under the U.S. tariff-rate quota (TRQ) regime – a modest quantity of only 87,000 MT.  Australia is asking that the TRQ be boosted by 750,000 MT, an increase of more than nine times.  The United States apparently has offered an additional 65,000 MT (official figure not disclosed), which would not even double Australia’s current access. 

Frankly, the Australians have the better side of this argument.  For the United States to insist on only a small increase in sugar access would be tantamount to accepting a very low level of ambition for agricultural market access in the TPP. 

But, you ask, aren’t the Aussies being too greedy?  Wouldn’t an additional 750,000 MT of imports cause the U.S. sugar program to collapse?  Close analysis reveals that the request actually is quite reasonable and that such an increase in sugar imports – handled appropriately – would not cause the program to collapse. 

Even U.S. sugar growers would acknowledge that a lot more Australian sugar imports could be accommodated, but they would want imports from Mexico to be reduced to make room in the marketplace.  (An increase in imports from Australia would equal a decrease from Mexico.)  Since Mexico is an active participant in the TPP negotiations, it probably isn’t feasible to reach agreement on a pact that simply robs Peter to pay Paul.  Plus, Mexico’s open access to the U.S. sugar market was negotiated over 20 years ago as part of the balance of concessions that went into NAFTA.  Mexican negotiators likely would not be amused at an attempt in the TPP to reduce the value of that access. 

The proper approach would be to reduce the quantity of sugar that U.S. growers are allowed to sell in the U.S. market by 750,000 MT.  This actually is a lot simpler to do than one might think.  Several years ago the U.S. sugar industry gave up the right to market as much as they could grow in order to maintain attractive price support levels.  They made a conscious decision that they would be better off selling somewhat less sugar than they would prefer, but at artificially high prices.  As if it was regulating a public utility, the U.S. Department of Agriculture (USDA) each year sets the overall allotment quantity (OAQ) that sugar growers are allowed to market domestically, roughly 10 MMT.  If the law was changed under the TPP implementing legislation to reduce the OAQ by 750,000 MT, U.S. growers would be able to sell about 9.25 MMT. 

There’s little doubt that the U.S. sugar industry would oppose such a change.  However, their protests should not be heeded.  Recall the earlier comment that the agreement settling the Mexican AD/CVD case had the effect of boosting U.S. price support levels by more than 10 percent?  That price increase would more than offset the smaller quantity growers would be allowed to sell.  Let’s do the math, using the conservative assumption that all sugar is valued at the effective support level for raw cane:

Income prior to the Mexican agreement: 

10 MMT x $490/MT = $4.9 billion

Income following the Mexican agreement, and incorporating a 750,000 MT reduction in the OAQ:

9.25 MMT x $545/MT = $5.04 billion

In other words, the increase in price that will accrue to U.S. sugar growers in response to the agreement with Mexico is more than large enough to offset revenues they would lose from a 750,000 MT reduction in the OAQ.  Since overall U.S. sugar policy would lead to a slight increase in the incomes of sugar growers, they have no legitimate basis for complaining about giving Australia the market access it is seeking.  The regulated sugar industry would remain comfortably cossetted.

What about commitments U.S. officials have made to the sugar industry regarding the TPP?  It’s important to understand what USTR Michael Froman has said.  When speaking about sugar on July 1 he stated, “Whatever we do in that area won’t undermine the sugar program.”  Frankly, granting Australia increased access of 750,000 MT while reducing the OAQ by a like amount would not undermine the sugar program.  Growers would earn more money than before, courtesy of the AD/CVD settlement agreement.  The structure of the U.S. sugar program would remain the same – a high price for sugar, coupled with limitations on how much domestic and imported sugar can be marketed.  There would be no fundamental reform of the sugar program to make it more market oriented.

It would be nice to think that the Obama administration might have sought a reduction in the U.S. sugar support price as part of the TPP process.  Meaningful liberalization of sugar policy would require reforms that strengthen competition, improve economic efficiency, and reduce costs for consumers.  (A paper on sugar policy reform can be found here.).  Such an outcome seems beyond reach at this point in the TPP negotiations, and would clearly be incompatible with Amb. Froman’s commitment not to undermine the sugar program. 

Instead, the administration’s trade policy has focused on “expanding economic opportunity for American workers, farmers, ranchers and businesses” by increasing “made-in-America exports.”  U.S. sugar growers generally do not export. The U.S. sugar price is higher than in most other countries, and the large and affluent U.S. market provides ample opportunities to sell their sugar at home.  The sugar industry simply isn’t in a position to help the administration achieve its goal of increasing exports.

On the other hand, U.S. farmers that raise the vast majority of other crops and livestock are globally competitive.  They easily could expand their exports, if more overseas markets are open to them.  The U.S. government is using the TPP as a forum in which to push Japan and Canada to make truly meaningful policy changes that would expand access for food and agricultural imports into those countries.  Trade negotiations are a poor time for practicing hypocrisy.  If the United States hopes to be successful in its legitimate pursuit of market opening in other countries, it needs to be willing to address its own previously sacrosanct programs.  The admittedly protectionist U.S. sugar program is at the top of the list.  Providing 750,000 MT of additional sugar access to Australia could be the key that would unlock the door to boosting exports of made-in-America grains, oilseeds, meats, and dairy products, along with a wide array of horticultural and specialty items. 

The best hope for a truly trade-expanding conclusion to the TPP is for the United States to provide a very substantial increase in sugar market access to Australia, coupled with equally significant efforts by the Japanese and Canadian governments to open their agricultural markets.  Genuine liberalization of the U.S. sugar market will have to wait for another day.