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The nation is abuzz with the visit of Pope Francis. There is, of course, a lot that could be discussed with the coming of the Pope, but for education it is a good time to remember the crucial importance of freedom. After all, for much of our history the biggest fights in education were over the public schools’ inability to accommodate Roman Catholics.

From the earliest advocacy of public schooling, arguably the primary goal has been to unite diverse people. As Founding Father Benjamin Rush put it in his Thoughts upon the Mode of Education Proper in a Republic, “Our schools of learning, by producing one general and uniform system of education, will render the mass of the people more homogeneous and thereby fit them more easily for uniform and peaceable government.”

Of course, there is a fundamental problem with this: diverse people will almost certainly want diverse things out of education, so conflict – and suppressing of politically weak minorities to end it – is inevitable.

For much of American history, there was no bigger flashpoint than religion.

Notably, the first religious disputes over “common schools” were not between Catholics and Protestants, but among Protestants. In the Massachusetts of common schools “father” Horace Mann, many orthodox Protestants took issue with the public schools that were to teach “nonsectarian” Christianity, a lowest-common-denominator Protestantism that, among many things, appeared to be Unitarian – Mann’s denomination. It is likely that Mann just wanted to avoid doctrines that would spur theological disputes, but even that proved impossible, with the absence of such doctrines also appearing sectarian.

Even with this divide among Protestants, it was the arrival of large numbers of Roman Catholics that really amped up religious combat over the nascent public schools. Driven by ancient European animosities and fears of Church authority being incompatible with democracy, defenders fought hard to keep a distinctly Protestant cast to the common schools, including reading only from the King James version of the Bible and using textbooks that at times featured content hostile to Catholicism.

Earlier, I used the term “combat” to describe the fights between Catholics and Protestants over the schools. Usually that only applied metaphorically, but not always, most shockingly with the Philadelphia Bible Riots, which were touched off by an ongoing conflict over whose version of the Bible could be used in the public schools. By the end of two waves of street-level warfare hundreds of people had been injured, tens killed, and millions of dollars of property damage inflicted.

Of course, there was not always conflict. Some districts found ways to work with Catholics, and many Catholics accepted the status quo. Still, a huge way by which peace was achieved was Catholics withdrawing from the public schools and starting their own institutions. But that meant paying twice for education: once for hostile public schools, a second time for schools that taught their religion and shared their values. It was an inherently unequal, unfair system.

Today, Catholic schools are not nearly as numerous as they were at their peak in 1965, when roughly 12 percent of all school-aged children – about 5.5 million kids – attended them. There are myriad reasons for this, including Catholics’ full integration into American society, movement from urban areas to suburbs, and the huge decline in school staffing by clergy and sisters who kept personnel costs at rock-bottom levels. But it is also clear that it is very hard to get people to pay for private schooling when there are free public schools, even if the free education is not as good. Making matters worse are charter schools, schools of choice that many parents perceive as private schools but which are, in fact, free public institutions.

Troublingly, it is perhaps now more than ever that we need school choice, because Americans are more diverse than ever.

There continues to be major religious diversity, and options outside of public schools appear to be especially in demand among evangelical Protestants who see public institutions as hopelessly devoid of God. There are also Lutheran, Episcopalian, Quaker, and other religious schools in demand by people who either want specific religious tenets taught to their children, or just access to schools with strong and coherent moral anchors. And then there are public schools where many atheists or members of minority religions perceive too much religious influence.

Of course, diversity doesn’t stop with religion…at all As you can see on Cato’s Public Schooling Battle Map, Americans have diverse and conflicting views on moral issues apart from religion; on what should be taught in history classes; on how freely students should be able to express themselves in school; and as recent headlines makes clear, on how strict discipline policies should be. And, of course, there are ongoing fights over how to treat racial and ethnic groups that have suffered far worse discrimination that Roman Catholics.

All of this – the incessant forced conflict and the subjugation of the politically weak often needed to end it – is utterly inconsistent with the individual liberty that is supposed to be at the core of American life. Perhaps the arrival of Pope Francis can spur us to remember how painfully that has played out in the past.

In 2012, Exit Polls revealed that President Obama garnered 71% of the Hispanic vote, while his Republican rival Mitt Romney captured a mere 27%. In 2008, Republican John McCain didn’t do much better, capturing only 31% of the Latino vote to Obama’s 67%. In sum, Latinos have demonstrated a strong affinity towards the Democrats. Is that because they hate Republicans? The data suggests no. 

A recent MSNBC/Telemundo/Marist poll finds that while Latinos are more favorable towards Democratic presidential candidates they are not antagonistic towards Republican candidates either, they just don’t know them—except for Trump.

On average, 17% of Hispanics gave negative ratings to potential Democratic nominees  Hillary Clinton, Joe Biden, and Bernie Sanders. Nearly the same share—15% gave negative ratings on average toward Republican candidates including Ben Carson, Marco Rubio, Jeb Bush, Ted Cruz, and Scott Walker. This number excludes, however, the 70% who gave a negative rating of Donald Trump, immigration provocateur.

While Hispanics don’t disproportionately view Republicans unfavorably, they do give more positive marks towards the Democrats. On average, 35% of Latinos had positive ratings of Democratic candidates and 20% had positive ratings of Republican candidates. 

A major difference between Republican and Democratic candidates was the share of Latinos who had never heard of, or had no opinion of, the candidates. On average, 42% of Latinos had no opinion of Republican candidates (again, excluding Trump from his average) compared to 27% who had no opinion of Democratic candidates. 

This data indicates that Latinos don’t hate Republicans. Instead, Republicans haven’t showed up in community venues or in news mediums to garner greater exposure in Hispanic communities as much as Democrats. When Republicans do make headlines in Hispanic communities, its typically for bombastic proposals like Trump’s plan to forcibly deport 11 million unauthorized immigrants, necessarily breaking apart families and loved ones.

Perhaps surprisingly, Latino’s negative attitudes toward Trump do not spillover toward the other GOP candidates. This means GOP candidates can stake out different positions on immigration and potentially win over a fast growing demographic in the country.

Donald Trump the Exception Not the Rule?

Donald Trump is the one Republican that Hispanics have disproportionately heard about—and what they hear is not good. While Republican candidates on average received negative marks from only 15% of Hispanics, Trump got a 70% negative rating.  Trump has made a number of provocative and controversial statements on the campaign trail, and his positions on immigration are likely behind his inability to connect with Latinos. 

A recent Washington Post/ABC news survey model found that immigration attitudes are the strongest statistical predictor of Trump support. Trump is not a limited government conservative, and neither are many of his supporters. But rather his controversial immigration positions are key to his support, and negatively define him among Hispanics as well.

For more public opinion analysis sign up here for Cato’s weekly digest of Public OpinionInsights.

A sense of historical perspective and responsible rhetoric may be too much to ask of candidates at this stage in a presidential campaign. With fifteen contenders all looking to score points some hyperbole is to be expected. Even so the level of threat inflation and “world in flames” talk last night was troublesome given how at odds it is with fundamental trends in world affairs.

Here is just a sampling of last week’s overheated discussion of global dangers:

Donald Trump: “The world is blowing up around us. …These are extraordinarily dangerous times that we live in.”

Ben Carson: “We’re talking about global jihadists who want to destroy us. …They are an existential threat to our nation.”

Rick Santorum: “Yes, they (Iran) are radical Islamists, that’s true. But their particular version of it, which is an apocalyptic version, which is a death cult, they believe in bringing about the end of the - end of the world. If you - if you poll Iranians and Iraqis, Shiites in the region, more than two-thirds of them believe that the end of the world is going to come within their lifetime. …They believe in bringing about the end of times. That’s their theological goal and we are in the process of giving them a nuclear weapon to do just that.”

Mike Huckabee: “This is really about the survival of Western civilization.”

With the candidates competing to outdo each other’s apocalyptic visions of the threats facing the U.S., it is no surprise that their policy prescriptions for Russia, Syria, Iran, and ISIL displayed a distinct tendency toward irresponsibility and overkill. Of the candidates in the debate, only Rand Paul and John Kasich articulated more temperate visions of U.S. foreign policy, Paul suggesting that sometimes intervention makes things worse and Kasich that the U.S. should actually wait to see how Iran behaves before simply ripping up the Iran deal and pursuing more aggressive options.

Just a few of the GOP debate’s policy proposals included:

  • Spending billions of dollars to “rebuild” a military that is already by far the most powerful in the world
  • Arming Israel with earth-penetrating ordnance to bomb Iran’s nuclear facilities
  • Conducting offensive cyber attacks on China as a form of deterrence
  • Sending 10,000 (or more) U.S. ground troops in to Syria to take on the Islamic State

The reality is that the world, though troubled, is more peaceful than at any other point in modern history. As scholars like Steven Pinker (The Better Angels of our Nature), John Mueller (Retreat from Doomsday), and Joshua Goldstein (Winning the War on War) have powerfully argued, warfare – indeed conflict of all kinds – has been on the decline for decades. The result, concludes the recent Cato volume, A Dangerous World?, is that the United States enjoys unprecedented security despite the presence of the Islamic terrorism and other troubles abroad. Nor is the good news limited to the decline of war. As the Cato project documents, the world has made steady progress in the past 100 years on all fronts from life expectancy and poverty reduction to the expansion of political and economic freedoms.

Unfortunately, this kind of good news won’t help Republicans get elected. And thanks to this relentless overselling of global dangers, few Americans understand the world’s peaceful trajectory and too many support shortsighted and counterproductive interventionist strategies.

The Chicago Council on Global Affairs just released its 2015 survey documenting American foreign policy attitudes. Entitled “America Divided: Political Partisanship and U.S. Foreign Policy,” the Council’s report emphasizes the stark disagreements between Republicans and Democrats over foreign policy goals and the means for achieving them. While there are certainly important differences between the two camps, there is a dangerous underlying consensus today that unites left and right: Americans of all stripes suffer from an “interventionist itch.” With respect to fighting terrorism and the Islamic State, Americans are far too supportive of the kinds of military intervention that have proved ineffective and counterproductive in the past.

As 9/11 receded and the war in Iraq descended in to insurgency, Americans became less interested in having the United States play an active role in world affairs and more wary of military intervention. Over the past year, however, as concerns have mounted over the Islamic State, so has the public’s willingness to support various measures to combat terrorism. Drawing on the CCGA survey, Table One reveals public support across party lines for a host of interventionist activities. In addition, the CCGA report notes, a majority of Americans would support cyberattacks and airstrikes (though not the use of ground troops) against Iran should Iran renege on the nuclear agreement.

American Support for Military Intervention: In order to combat international terrorism, please say whether you favor or oppose each of the following measures (% favor)*






US air strikes against terrorist training camps and other facilities





Using drone strikes to assassinate individual terrorist leaders





Assassination of individual terrorist leaders





Attacks by US ground troops against terrorist training camps and other facilities





Providing military assistance to Arab governments to combat violent Islamic extremists groups





Keeping some US troops in Afghanistan beyond 2016 for training and counterterrorism





These figures suggest several sobering conclusions. First, they clearly indicate a stable interventionist consensus that includes both obvious advocates (Republicans) and less obvious advocates (Democrats and even Independents). Such a consensus is somewhat surprising considering all evidence from the past 14 years of intervention makes clear just how poorly such tactics have worked and because the public has repeatedly come to oppose the interventions they previously favored after they prove ineffective. On the other hand, the presence of this consensus is understandable given the interventionist agendas of the Bush and Obama administrations and the vocal support from both Republican and Democratic leaders for more intervention of various kinds.

Second, the consensus illustrates the degree to which the threat of terrorism has come to dominate the U.S. conversation about national security. The 2015 CCGA study finds no increase in support for the use of military force to aid Taiwan, or Israel, or South Korea. But terrorism, even 14 years after 9/11, remains a lighting rod capable of inducing overheated rhetoric and overheated fears.

Finally, these figures indicate that interventionist cries from the candidates will find a receptive audience as we approach the 2016 elections. All of the Republican candidates (Rand Paul aside) as well as Hillary Clinton have staked out positions arguing for more intervention. There is thus every reason to believe that the United States will find itself further entangled in the Middle East in the near future.

*Source: Chicago Council on Global Affairs, “America Divided,” 2015.

The FOMC decided last week against raising interest rates given its concerns about the global economy and financial conditions. While these concerns are reasonable, the FOMC’s decision highlights a growing problem that has increasingly plagued the Fed since the crisis erupted: its incredibly ad-hoc approach to monetary policy.

Just a few months ago the FOMC was signaling it would almost certainly raise interest rates, but now it has changed its mind. This change would not be so bad if it were predictable, but it was not so. No one expects the Fed to perfectly forecast the economy, but we should expect the Fed to make clear how it would respond to differing states of the economy. This simply has not happened. From the QE programs to forward guidance to lifting interest rates from zero, Fed policy has been made up on the fly. This unpredictable behavior has meant that no one, including Fed officials, knows for sure what will happen from one FOMC meeting to the next.

As a result, markets have become more and more obsessed with every word coming from the mouths of Fed officials. Post-FOMC press conferences like the one last Thursday became must-watch TV for anyone concerned about investments. Ironically, then, the Fed’s attempt to calm markets through these ad-hoc measures has only made them more fragile.

It would be far better for the Fed to focus on a narrow mandate in a rule-like manner that makes conditional forecasts possible. For example, if the Fed were to target a stable growth path for total dollar spending and adjust policy as needed to hit it there would be far less of the Fed’s current guessing game. The FOMC’s decision last week highlights how sorely this change is needed.

[Cross-posted from]

The federal government spends almost $4 trillion a year. It has hundreds of agencies and runs more than 2,300 subsidy programs. It employs 2.1 million civilian workers, 1.4 million uniformed military personnel, and 560,000 postal workers. It is a huge organization.

It also fails a lot and is increasingly distrusted. One new Gallup poll finds that three-quarters of Americans think that government corruption is widespread, while another shows that half of Americans believe that the federal government is a threat to our freedom.

A new essay, “Bureaucratic Failure in the Federal Government,” at examines structural features of the executive branch that cause federal failure and help to engender such a dim view from the public.

Four of the participants in next month’s Cato conference have written essays pertaining to the geopolitics surrounding TTIP.  Today, we publish two of those essays in our Online Forum.

First, in this piece, Phil Levy of the Chicago Council on Global Affairs and Northwestern University’s Kellogg School of Management notes the interrelatedness of economic and security interests in the TTIP and writes that “A successful TTIP would have a number of salutary effects on the geopolitical scene. The necessary corollary is that a failed TTIP effort could be costly…”

Second, in this piece, while acknowledging that “TTIP can be a valuable geopolitical tool for the United States,” Peter Rashish of Transnational Strategy Group LLC, also cautions that “policymakers need to weigh carefully how far trade policy should go in promoting U.S. foreign policy objectives.”

Your comments are welcome.

Today’s essay for Cato’s Online Forum on the Transatlantic Trade and Investment Partnership comes from Berkeley Political Science Professor Vinod K. Aggarwal, who explains the growing popularity of trade liberalization outside the WTO, and discusses how third countries might react to a TTIP agreement between the United States and European Union.

This essay and this forum are associated with an upcoming TTIP conference at Cato on October 12.

Desperately searching for an establishment Republican who can block Donald Trump, many observers are ignoring the strong and politically astute performance of Rand Paul in Wednesday night’s Republican debate. A classic example this morning is Michael Gerson, the big-government Republican who has written for George W. Bush and the Washington Post and is the most anti-libertarian pundit this side of Salon. Recognizing the need for the Republican party to reach new audiences, especially “with minorities, with women, with younger voters, with working-class voters in key states,” Gerson writes:

The relatively rare moments of economic analysis and political outreach in the second Republican debate — Chris Christie talking about income stagnation, or Marco Rubio lamenting the “millions of people in this country living paycheck to paycheck,” or Ben Carson admitting the minimum wage might require increasing and fixing, or Jeb Bush setting out the necessary goal of accelerated economic growth, or John Kasich calling for a “sense of hope, sense of purpose, a sense of unity” — served only to highlight the opportunity cost of the Trump summer.

What’s missing? Well, Rand Paul talked about marijuana reform, an issue that is far more popular than the Republican Party, especially among younger voters. And criminal justice and incarceration, an issue of special concern to minorities. And especially about our endless wars in the Middle East, at a time when 63 percent of Republicans and 79 percent of independents say that the Iraq war was not worth the costs, and when 52 percent of Americans say the United States “should mind its own business internationally and let other countries get along the best they can on their own.” (Not the best formulation, as noninterventionists are not opposed to international activity, just to imprudent military action. But you go to print with the polls you have, not the polls you wish you had.) Those are attempts to reach new audiences that a fair-minded debate watcher would have noticed.

Fortunately, not everyone was deaf to Paul’s arguments. Even at the Washington Post people noticed:

Eugene Robinson: Rand Paul seems to have become a libertarian again, sticking up for individual rights. And unlike the others on the stage, he spoke out for peace rather than war.

Charles Lane: For my money, Paul has delivered the two pithiest critiques of Trump of anyone so far in the debates.

In Cleveland, he pointed at Trump, who actually boasts about his promiscuous political donations, and declared, with complete accuracy, “I mean, this is what’s wrong. He buys and sells politicians of all stripes.”

Last night, Paul was also spot-on regarding Trump’s over-the-top rudeness: “Do we want someone with that kind of character? With that kind of careless language? I think there’s a sophomoric quality about Mr. Trump… about his visceral response to attack people on their appearance, short, tall, fat, ugly.” He added: “Do we really want someone in charge of our nuclear arsenal who goes around basically using the insults of a junior high or a sophomore in high school?” Lately, Paul’s stump speeches hammer on these themes, too.

And in the conservative media:

Tim Carney of the Washington Examiner: Rand Paul just gave the smartest comments on foreign policy from a GOP debate stage in decades.

Guy Benson of Fox News and Townhall: Rand Paul making case that Iraq war didn’t make us safer… which most Americans agree with.

And in the heartland of America, John Kass at the Chicago Tribune:

Rand Paul won the Republican presidential debate.

It wasn’t even close….

Paul, the senator from Kentucky, spoke like a thoughtful grown-up, overshadowing them all on foreign policy, explaining that intervening in Middle East civil wars is a recipe for disaster….

“Sometimes both sides of the civil war are evil, and sometimes intervention sometimes makes us less safe,” Paul said. “This is the real debate we have to have in the Middle East….

There is no buzz to such rhetoric, no bloody gusto, no King Leonidas abs of steel, no Joan of Arc with a sword.

It’s just grown-up talk, and so, quite likely, not entertaining at all.

Right now 50 percent of Republicans tell pollsters they support two candidates who have never before sought or held public office, and who are highly unlikely to succeed in this race. That means the race is still wide open. As Rand Paul said Wednesday night, “If you want boots on the ground, and you want them to be our sons and daughters, you got 14 other choices.” Millions of Republicans believe in free enterprise, smaller government, less punitive drug laws, and a more cautious approach to military intervention. If Paul can convince them that he’s the only candidate who shares their perspective, he has every opportunity to move up sharply in the polls. But there’s powerful Establishment resistance to new ideas and new policies.

We had our second debate of the primary season on Wednesday, a grueling five hour affair pitting fifteen Republican hopefuls against each other in two debate sessions. When CNN’s hosts weren’t asking inane questions – i.e., whether candidates had considered their Secret Service nickname or whether they would trust Donald Trump with the nuclear codes – they did find some time to focus on foreign policy issues. I have a piece over at the National Interest discussing the debate, and highlighting some of the misleading narratives underlying much of the GOP debate.

Though there were some factual errors, the bigger problem was the reliance of most candidates on fundamental ideas which are effectively untrue, like the idea that the U.S. military is weak or small compared to that of other nations:

Ben Carson noted that “our Air Force is incapable of doing the same things that it did a few years ago. Carly Fiorina argued that “we need the strongest military on the face of the planet,” while Marco Rubio noted that “… we are eviscerating our military.” Such claims are entirely false: the U.S. military is among the world’s largest, spending more than the next 13 countries combined in 2013 (including China and Russia)!  Today, the United States makes up 38.4% of all global military spending, and spends substantially more on the military than it did on average during the Cold War.

Many candidates also expressed support for the idea that it is U.S. absence from conflicts which creates problems, rather than U.S. intervention itself. Again, this narrative has proven to be demonstrably false in the last ten years, as examples from Libya, Iraq and elsewhere show:

Jeb Bush noted that “when we pull back, voids are created. We left Iraq… and now we have the creation of ISIS.” Again, this narrative is convenient for many candidates, allowing them to blame President Obama’s troop withdrawals, rather than the initial disastrous decision to invade Iraq, for the rise of ISIS. Unfortunately, it is similarly false: Iraq’s sectarian problems existed long before the U.S. withdrawal of troops in 2011, and the rise of ISIS is at least partly a result of the Bush administration’s decision to disband the Iraqi army.

When we base our foreign policy debates on such misleading ideas, candidates will present policy options which are unworkable or even counterproductive. Voters deserve a better debate, one which acknowledges the nuance and complexity of foreign affairs. You can read the whole piece here

Pope Francis asked all Catholics to pray for those “who seek a home where they can live without fear” but went further by actually praising those who help refugees.  In arguing for the admission of more Syrian refugees, he said the goal should be “to give them a concrete hope, and not just to tell them: ‘Have courage, be patient!’”  No doubt the Pope would go further than many of us in arguing for welfare for refugees even though merely getting the governments of the way to stop hurting refugees is enough, but his full-throated support for granting them refuge is commendable.

But Pope Francis didn’t just talk about refugees fleeing violence, he also discussed those fleeing poverty:

We see these refugees, these poor people who are escaping from war, escaping from hunger, but that’s the tip of the iceberg.  But underlying that is the cause, and the cause is a socio-economic system that is bad, unjust, because within an economic system, within everything, within the world, speaking of the ecological problem, within the socio-economic society, in politics, the person always has to be the center.  And today’s dominant economic system has removed the person from the center, and at the center is the god of money.  [Emphasis added]

The Pope is correct that free-markets are to blame for immigration, but not in the way he thinks.  The prosperity of free-market countries attracts large numbers of immigrants from less-free ones.  Economists Maryam Naghsh Nejad and Andrew T. Young recently found that improving economic freedom is a huge attraction for immigrants.  Fortunately that movement does not decrease economic freedom in receiving nations and may actually increase it according to this paper, but the lesson is that people who vote with their feet prefer relatively freer economic systems.

The Pope is deeply and rightly concerned with poverty but he should consider that immigration is an excellent way to fight it.  Migration is one of the most successful strategies the World Bank has developed to fight poverty – raising the wages of Tongan migrants in this example almost 10-fold in a short period of time.  No other development project has shown such dramatic improvements and the improvements are scalable.  Crucially, as economist Michael Clemens pointed out, that increase in Tongan wealth also made New Zealand a wealthier nation through the benefits of mutually voluntary exchange.

Pope Francis is generally supportive of liberalizing immigration policy and reducing poverty around the world, but he should realize that free-markets and the migration of poor people to them is the cheapest and fastest way to alleviate much human suffering.

Last week, the Department of Justice announced a new policy regarding its approach to corporate criminal investigations.  Instead of focusing first on the company and, having resolved that portion of the investigation, turning to the task of identifying potential individual criminal suspects, prosecutors are now directed to build their cases against individual wrong doers from the start.  Media coverage of this policy statement has focused on criticism levied against the administration for being too soft on Wall Street and too cozy with corporate donors.  The New York Times trotted out the old complaint that no one went to jail in the wake of the financial crisis (even though, to my knowledge, no one has ever identified a criminal law the violation of which caused any part of the crisis).  While the administration’s rhetoric about equal justice before the law is admirable, the policy memo and its surrounding coverage have a distressing whiff of scapegoating about them. 

Deputy Attorney General Sally Yates asserted that the DOJ would not simply “accept…a company’s cooperation when they just offer up the vice president in charge of going to jail.”  Yet the incentives inherent in the new policy risk provoking just that response.  It is clearly the intent of the new policy to procure more criminal charges against individuals.  Prosecuting attorneys will therefore be under pressure to find individuals to charge.  Additionally, the first principle stated in the memo is “To be eligible for any cooperation credit, corporations must provide to the Department all relevant facts about the individuals involved in corporate misconduct.”   Companies therefore will be highly incentivized to identify at least one individual and provide as much information as possible, as quickly as possible, to the DOJ on that person’s conduct.  Despite the memo’s insistence that the company identify all individuals involved in the alleged misconduct, “regardless of their position, status or seniority,” company management, knowing that at least one individual is likely to face criminal charges, will be motivated to point fingers at anyone but themselves.  The more quickly their accusations can coalesce around one individual – the Chief Going to Jail Officer – the more quickly the DOJ may end its “send individuals to prison” phase and turn to settling up with the corporation itself.  As the memo acknowledges, corporate criminality is difficult to prove, especially “[i]n large corporations, where responsibility can be diffuse and decisions are made at various levels[.]”  In these circumstances, “it can be difficult to determine if someone possessed the knowledge and criminal intent necessary to establish their guilt beyond a reasonable doubt.”  All the more reason, if management is convinced someone is headed to prison, to ensure the arrows all point at one culpable and easily convictable individual, saving the skins of everyone else. 

It may be, however, that the incentives of criminal prosecution will always include finger-pointing and scape-goating.  As I said, the argument that “[t]he public needs to have confidence there is one system of justice and it applies equally regardless of whether that crime occurs on a street corner or in a boardroom” is a compelling one.  I would add, however, that we should also have confidence that the laws apply equally whether the boardroom is a large expensive one or a shabby little one.  Companies facing a government investigation will often hire a law firm to complete an internal investigation on the company’s own dime.  The investigation, yes, may be ordered to fulfill the directors’ duty to the company and to compliance with the law, but is also almost always intended to help smooth the company’s negotiations with the government.  These investigations therefore occupy an uneasy space.  First, they encourage the corporation to, in effect, inform against itself.  Second, they provide the opportunity for a better settlement for the companies wealthy enough to afford the investigation.  Internal investigations are not cheap.  To be effective, they must be thorough and thoroughness is expensive.  It requires a large quantity of attorney hours to ensure that the investigation is conducted methodically, carefully documented, and that all leads are run to ground.  When the DOJ says that “providing all relevant facts” is the “threshold requirement” for eligibility to have its cooperation considered as a mitigating factor and that cooperation credit will be assessed based on factors such as “timeliness…diligence, thoroughness, and speed,” it suggests that companies with the money to pay for a high caliber firm to conduct the investigation is likely to get the best deal.  While this is not anything new, it nonetheless contradicts the stated purpose of the new policy: ensuring equal treatment under the law.

Charging executives individually may well encourage them to exercise more diligence in keeping on the right side of the law.  However, it would be irresponsible to ignore the potential side-effects of any policy whose intent is to put more individuals behind bars.  This is especially true when the policy appears to have been developed in reaction to public clamor that “someone” needs to pay.  No just law was ever written to placate witch hunters. 

The African Intellectual Property Organization (OAPI) has reportedly accepted the registration of “Scotch” as a geographical indication for whisky “made in Scotland from water, cereals and yeast, and matured for at least three years.”  It’s unclear what if any commercial consequences this move will have considering that the 17 West African countries of the OAPI are not major consumers of Scotch.  However, it does have significant importance as a step forward in the attempt to use GI protection to secure excessive privileges for Old World producers in foreign markets.

Perhaps the word “Scotch” does indeed refer only to whisky made in Scotland.  The Scottish producers of scotch certainly think so.  In no uncertain terms, the spokesperson of the Scotch Whisky Association says that GI registration will protect consumers from “fakes.” 

But the purpose of GI protection is generally not to fight against fakes (fraud is already illegal everywhere) but to prevent the use of place names as generic descriptions of products.  Scottish producers want to make sure that no where on earth are consumers allowed to think that “Scotch” simply means whisky made according to the methods historically used in Scotland. 

Consider the example of Champagne.   To some, champagne is a word that means bubbly white wine.  To others, it is a name for wine made near Epernay, France according to traditional methods.  French champagne producers have been fighting long and hard to claw back the word and prohibit its use as a generic term.

But there are many, many geographic words that are used as generic descriptors.  Consider Belgian waffles, French fries, Philly cheesesteak, or even Valencia oranges.  Despite being the names of places, these words tell you what the product is like, not where it came from.  

There are two big policy questions surrounding GIs: (1) whether a geographic term deserves protection and (2) what actions are prohibited once a GI is protected.  Let’s consider the second question for now.

Whenever a government decides to control the use of language to protect commercial interest, it runs the risk of overprotecting that interest at the expense of the public.  This is a basic problem for trademark law, where to prevent excessive protection, trademarks are not protected if they are merely descriptive terms, and the test for infringement of protected marks hinges on whether there is a likelihood of confusion as to the source of a product.  In the United States, GIs are generally protected under trademark law.

The OAPI’s GI protection laws are modeled after the European system, which does not employ those kinds of limitations.  Consider this provision of the OAPI’s GI rules:

it shall be unlawful to use, for commercial purposes, a registered geographical indication, or a similar designation, with respect to the products specified in the Register or similar products, even if the true origin of the products is indicated or if the geographical indication is in the form of a translation or is accompanied by terms such as “kind”, “type”, “make”, “imitation” or the like. [emphasis added]

In other words, use of the word “Scotch” is now illegal even if there is zero possibility that a consumer would think the whisky comes from Scotland because the bottle says “Pecos Bill’s Scotch-style Texas Whisky.”  This kind of rule does not benefit consumers in any way at all, but it does further the interests of Scottish whisky makers at the expense of common, accurate speech.

Why should this matter to anyone outside of Scotland and West Africa?  Because it is part of a very troubling movement within international economic policy. The European Union is using free trade agreements to pressure countries to adopt this excessive form of GI protection and to protect a list of specific GIs even if they are generic terms in that country.  These include wine names like champagne, port, and sherry as well as numerous generic cheese names like parmesan, asiago, feta, and gorgonzola. 

As the United States negotiates the Transatlantic Trade and Investment Partnership with the EU, it’s important for American policymakers to understand that Europe’s approach to GIs is protectionist and incompatible with the goal of free trade in a globalized economy.  This is true even if you think “Scotch” can only be made in Scotland.

At The National Interest, I write about Rand Paul’s clear and forceful presentation of his noninterventionist views at last night’s Republican debate:

Rand Paul found his voice last night. He’s a sincere noninterventionist in foreign policy. If he can get that message across, there’s a Republican constituency for it, and even broader support among independents.

Coincidentally or not, Paul’s standing in the polls has fallen as he seemed to move away from the noninterventionist positions associated with his father, congressman and presidential candidate Ron Paul. He called for a declaration of war with ISIS, more military spending, and rejection of President Obama’s Iran deal.

Meanwhile, hawkish conservative pundits consistently underestimate the extent of non interventionist and war-weary sentiment in the Republican party….

Standing in front of Reagan’s Air Force One, he embraced Reaganism:

“I’m a Reagan Conservative. I’m someone who believes in peace through strength, and I would try to lead the country in that way knowing that our goal is peace, and that war is the last resort, not the first resort. And, that when we go to war, we go to war in a constitutional way, which means that we have to vote on it, that war is initiated by congress, not by the president.”

And most particularly in electoral terms, he set up the alternatives for voters:

“If you want boots on the ground, and you want them to be our sons and daughters, you got 14 other choices. There will always be a Bush or Clinton for you, if you want to go back to war in Iraq.”

That’s Paul’s best path to the top of the polls. All the other candidates supported the Iraq war (except Donald Trump) and threaten more military action today….

Guy Benson of Townhall and Fox News tied his comments to politics: “Rand Paul making case that Iraq war didn’t make us safer…which most Americans agree with.”

I wrote more about noninterventionism at National Review in May, drawing on arguments from The Libertarian Mind.

Two very recent episodes involving basic constitutional rights demonstrate the power of an informed and active citizenry successfully confronting government fear-mongering and overreach.

The first happened this week in Irving, Texas, where 14-year-old Ahmed Mohamed was arrested after bringing a homemade clock to school to show his engineering teacher.  Government officials insisted that Ahmed’s clock might have been a bomb.

Distressingly, Ahmed claims that his interrogation occurred despite the fact that he asked to see his parents before answering any questions.  Police allegedly refused, and continued the interrogation anyway.  Ahmed was subsequently and inexplicably handcuffed, arrested, and transferred to a juvenile detention facility, still without access to his parents.

The public reaction against Ahmed’s treatment was swift and voluminous. Facebook and Google executives offered the aspiring engineer trips to their offices.  MIT representatives extended similar opportunities.  Even President Obama got in on the act, inviting Ahmed to bring his clock to the White House. #IStandWithAhmend quickly became the cause of the day on social media.

Government officials only fed the frenzy by issuing defenses such as “He kept maintaining it was a clock, but there was no broader explanation,” and that officials had “followed protocol.”  The school even sent home a letter defending itself for protecting students and assuring parents that their children were safe from a threat that never was.

When asked to explain why police refused to allow Ahmed to speak with his parents or a lawyer during his interrogation, police chief simply said that he “[didn’t] have answers.”

That answer isn’t good enough.

A minor child should not be interrogated by police in the absence of some adult who can protect him.  And no person, regardless of age, should be interrogated after requesting the assistance of adult counsel, whether it’s a parent (who is treated as a legal representative of a minor child in a great many contexts) or a lawyer.

School officials and police clearly have an interest in protecting the safety of the children under their supervision, but public officials also have an obligation to respect the Constitutional rights of everyone under their authority. Even under the most charitable interpretation of the facts, the interrogation was out of bounds.  Once it became obvious that there was no bomb and the investigation shifted to whether the whole thing was either a hoax or a misunderstanding, any conceivable threat had evaporated.

In some areas of the law, policy against allowing minors to waive their rights is so absolute as to produce absurdity, such as when age of consent laws are used to prosecute sexting teenagers for production and possession of child pornography (to wit: pictures of themselves).

Yet when it comes to protecting minor children from the immense power of the police and prosecutorial machinery of the state, children are routinely left defenseless. No child should have to face the government alone.

The government’s behavior throughout this case invites allegations of racial profiling, but profiling isn’t doing all of the work here.  Students of all ethnicities and faiths have been subjected to violations of their rights in school settings by government officials.  From strip searches for ibuprofen to suspensions over pop tarts shaped like guns, to random, warrantless searches, American school students are routinely at risk of having their rights violated by overly broad policies or overzealous government officials.

The Supreme Court once said that public school students do not “shed their rights … at the schoolhouse gate,” but all too often school officials and police officers use tactics designed for hardened criminals to circumvent the rights of students.

Given the tremendous outpouring of support, it’s likely that Ahmed Mohamed will be made whole from this experience.  The same cannot necessarily be said for the great many other students who have fallen victim to overzealous school policies and law enforcement.

Ahmed’s case does, however, highlight the value of an informed and activist citizenry willing to hold government officials accountable when the legal system will not.

The second episode happened yesterday, when the Lebanon, New Hampshire Library Board of Trustees rejected attempts by the Department of Homeland Security and the local police department to convince the library overseers to shut down a Tor node created in the Kilton Library as part of the Library Freedom Project. As the White River Junction, Vermont Valley News reported

The Lebanon Library Board of Trustees let stand its unanimous June decision to devote some of the library’s excess bandwidth to a node, or “relay,” for Tor, after a full room of about 50 residents and other interested members of the public expressed their support for Lebanon’s participation in the system at a meeting Tuesday night.

“With any freedom there is risk,” library board Chairman Francis Oscadal said. “It came to me that I could vote in favor of the good … or I could vote against the bad.

“I’d rather vote for the good because there is value to this.”

Other libraries in the region may follow Kilton’s example

Reading (Vt.) Public Library Trustee Mildred Waterfall came to Lebanon for Tuesday’s meeting and said the Reading board will discuss hosting a Tor relay at its next meeting.

A former teacher, Waterfall likened the idea of taking Tor away to prevent the criminal activity of a few to a new teacher punishing the entire class for one student’s bad behavior.

“That’s what it feels like,” she said before the meeting.

The experience of Kilton Library employee  Maria Ortiz in her native Columbia gave her a special appreciation for the Lebanon Library Board of Trustees decision

“Democracy in South America is very powerful on paper, but in America it’s powerful not only on paper,” Ortiz said.

She said the library’s support for freedom of speech “made me proud to be here.”

This local victory for free speech and technological innovation is part of the larger national debate between those like FBI Director James Comey who want to compromise privacy and encryption in the name of “national security” and those who argue that strong encryption and privacy safeguards are our best defense against malicious actors, whether individuals or foreign powers. The latter argument may at last be gaining some ground with senior Obama administration officials.

It’s terrific that President Obama is going to host Ahmed at the White House. That meeting would be all the more powerful if he also invited the sponsors of the Library Freedom Project so they can talk to Ahmed about his constitutional rights in the digital age. It’s possible that the President might learn something too. 

In mid-2013, the Transatlantic Trade and Investment Partnership negotiations were launched to great fanfare with a pledge from its architects to conclude a deal within one year on a “single tank of gas.” Nearly two and a half years and 10 negotiating rounds later, a final TTIP deal is nowhere in sight. Well, if there is anything that trade policy observers should know by now to be an ironclad law of physics, it’s that deadlines for concluding negotiations are never respected.

Concluding trade agreements can be a long and arduous process, especially if the United States or the European Union is a party to the negotiations.  So when the United States and the European Union (who are used to dictating the terms of trade deals to smaller economies) are both party to a negotiation, it probably makes sense to budget in a little extra time for refueling – and perhaps even a new set of tires.

With that in mind, on October 12 the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies will host a conference titled: Will the Transatlantic Trade and Investment Partnership Live Up to Its Promise? Featuring 30-35 international trade and investment policy experts from academia, think tanks, business, and government, the conference will examine the economics, geopolitics, and architecture of the TTIP during a full day of panel presentations, interviews, and debates. The program is open to the public and you are encouraged to attend.

Among the many questions that will be raised during the conference are:

  • What are the prospects for reaching a comprehensive trade and investment deal between the United States and the European Union?
  • What exactly is under negotiation, and what is the strategy for advancing those negotiations?
  • Would it make sense to exclude sacred-cow issues that will only bog down the negotiations?
  • Is it wise to continue pursuing a single comprehensive deal for all issues on the table, or is it better to aim for a sequence of smaller agreements?
  • Should a deal include other closely integrated countries, such as Canada, Mexico, and Turkey?
  • How will TTIP affect the multilateral trading system, relations with the BRICS countries, and prospects for developing countries?
  • Where are the biggest potential gains for U.S. and European businesses?  For consumers and taxpayers?
  • What are the major domestic political impediments?

In conjunction with the conference, each participant has been asked to write an essay of approximately 1,500 words on any aspect of the TTIP that he or she finds interesting, important, or compelling.  Those essays will be published and stored in this space – one or two per day – beginning today and running through the week following the conference, when the 11th Round of TTIP negotiations will be taking place in Miami. I hope you will peruse, if not closely read these essays, which represent a broad range of views from experts with different opinions about the importance, propriety, scope, and specific contents of the TTIP. Your feedback is welcome and encouraged.

With that background, the first essay is from Jim Kolbe of the German Marshall Fund of the United States, who gives a solid overview of the stakes and potential benefits of TTIP, while describing the formidible obstacles the negotiators will need to surmount.

For all the ink spilled on TARP — the bailout package authorizing the Treasury to purchase or insure up to $700 billion of “troubled assets” during the financial crisis — that program is dwarfed by another market intervention that occurred around the same time. In fact, the Government Accountability Office estimates that the Federal Reserve lent more than $16 trillion to financial firms between December 2007 and July 2010 — a figure that comes close to matching the entire, annual gross domestic product of the United States.

On Wednesday, Cato’s Center for Monetary and Financial Alternatives hosted a two-part discussion of the Federal Reserve’s emergency lending power, and the legislative efforts underway to reform it. The first panel saw the Washington Post’s Ylan Mui interview Phillip Swagel, a former Treasury official turned University of Maryland professor, Marcus Stanley, the policy director at Americans for Financial Reform, and Mark Calabria, Cato’s own director of financial regulation studies. United States Senators Elizabeth Warren (D-MA) and Richard Vitter (R-LA) joined us for the second panel, during which they outlined their proposed “Bailout Prevention Act of 2015,” as well as their broader, bipartisan quest to end “too big to fail.”

As the participants in our first panel explained, the Fed’s emergency lending is governed by Section 13(3) of the Federal Reserve Act. At the time of the financial crisis, this gave the Fed broad authority to lend to “any individual, partnership or corporation” in “unusual and exigent circumstances” so long as “other banking institutions” were not prepared to pony up the cash. The Dodd-Frank Act of 2010 tried to temper this unbridled discretion, introducing a sensible requirement that the Fed only lend to solvent institutions as part of a broad-based program of market support. Alas, the devil proved to be in the detail — or, rather, the lack thereof.

The legislative intent in Dodd-Frank was clear enough: the Fed should intervene when a lack of market liquidity imperils otherwise viable firms, but it shouldn’t be in the business of bailing out specific, failing institutions. And yet, as several of our panelists explained, the Fed’s subsequent rulemaking took a far looser view: as far as the central bank is concerned, a program is “broad-based” as long as more than one firm receives support, and a firm is insolvent only if it has already entered bankruptcy proceedings. In other words: the Fed can continue to do more-or-less as it pleases.

Why is this a problem? Enter Senators Warren and Vitter. As they both pointed out, the goal of their proposed legislation is not simply to tie the Fed’s hands in a crisis. Rather, their overriding concern is that the very existence of these broad powers to bail out financial institutions encourages risk, leverage, and cavalier management in the banking industry, while simultaneously undermining any incentive lenders and investors have to supervise the financial firms into which they put their money. As Warren explained,

If you advertise to the market that the Fed is here, and no need for any large financial institution ever to have to go to the bankruptcy court house or declare itself insolvent, but instead there will be trillions of dollars available to back up these giant institutions, I think that changes fundamentally the behavior of the big banks themselves, the behavior of those who lend them money, the behavior of those who invest in them. And I’ve got to say, in all three cases: “not for the better,” because it encourages riskier behavior knowing that there is an option available.

Warren and Vitter went on to point out that this whole dynamic distorts the market over time, tilting the playing field in favor of the biggest banks — for whom implicit government guarantees mean a lower cost of capital — and eroding the competitiveness of smaller financial institutions, who know they are not too big to fail. This leads, in Warren and Vitter’s view, to greater market concentration and more systemic risk — the very things that financial regulation seeks to avoid.

Accordingly, the senators’ proposed “Bailout Prevention Act” would significantly tighten the rules surrounding the Fed’s 13(3) emergency lending, as amended by Dodd-Frank. First, it would define “broad-based” to mean that at least five firms must participate in any emergency lending program. Second, it would require that those participating firms certify that the value of their assets exceeds their liabilities. Third, it would insist that any emergency lending be offered at a penalty rate five percentage points above that on Treasury Bills. As Mark Calabria put it, “part of this should be making the Fed actually a lender of last resort, rather than a rescuer of first resort.” It certainly seems like a good start — even if some of us would prefer that there was no lender of last resort at all.

The full discussion, which also touches on the best way to approach financial regulation going forward, is available below.

[Cross-posted from]

Senator Elizabeth Warren (D-MA) and Sen. David Vitter (R-LA) came to the Cato Institute on Wednesday to call for stricter limits on the Federal Reserve’s ability to prop up large financial institutions with loans guaranteed by taxpayer dollars—which Warren characterized as “shoveling money out the back door.”

Warren noted that, during the financial crisis, most of the focus fell on TARP. “But what a lot fewer people were talking about was how the Fed was shoveling money out the back door in a very quiet way, not to support the financial system overall, but to support very targeted financial institutions. $9 trillion—your money, tax dollars, went out the door, to just three financial institutions.” 

Vitter joked that he and Warren are “the Odd Couple” of Congress, but added, “I think the fact that we’re here working on this together illustrates how broad and legitimate the concern across America is with ‘too big to fail,’ and the fact that it is, unfortunately, alive and well.”

“Left right and middle, I think it’s a very broad concern,” he said. The senators have proposed a bill that would forbid the Fed from lending money to insolvent institutions, and would place a high interest rate on the loans.

Warren mocked the Fed’s current standard of “insolvency” for financial institutions, which they define as not yet having filed for bankruptcy. “The way I read that, they said ‘What we’re going to do is set up a little cart, right in front of the bankruptcy courthouse, and when institutions come to file their papers…we’ll just intercept and say, ‘Would you like a trillion dollars from us instead?’”

Warren argued that giving large institutions a free government guarantee unfairly pushes smaller institutions out of the market.

“The question is, will the insiders control the game—those who’ve got the lobbyists, those who’ve got a lot of money on the table, but a very small, insular group, that, frankly, wants to enhance its profits at the expense of the public,” she said. “You’re driving one set of competitors out of business, and advantaging another set of competitors.” 

“’Too big to fail’ is not over,” she said, “And it is our responsibility in the United States Senate and the United States House of Representatives to do everything we can to turn the rules in the direction of taking away the advantages that the ‘too big to fail’ banks enjoy in this marketplace and in this political system.”

Global warming theory predicts increased mortality due to global warming, but observations frequently suggest the opposite. The newest case-in-point comes from a study by Chau and Woo (2015).

Setting the stage for their enlightening new study, the pair of researchers note there is a growing concern about the potential impacts of global warming on human mortality, where some researchers estimate future increases in heat-related deaths will outnumber future decreases in cold-related deaths. In a test of this hypothesis, the two Chinese scientists examined summer (June-August) versus winter (December-February) excess mortality trends among the older population (65 years and older) of Hong Kong citizens over the 35-year period 1976-2010. This was accomplished through the performance of statistical analyses that searched for relationships between various measures of extreme meteorological data and recorded deaths due to cardiovascular and respiratory-related causes. And what did those analyses reveal?

With respect to the weather, Chau and Woo report there was an average rise in mean temperature of “0.15°C per decade in 1947–2013 and an increase of 0.20°C per decade in 1984–2013.” They also note that over the 35-year period of their analysis “winter became less stressful” with fewer extreme cold spells. Summers, on the other hand, became “more stressful as the number of Hot Nights in summer increased by 0.3 days per year and the number of summer days with very high humidity (daily relative humidity over 93%) increased by 0.1 days per year.” Given such observations it would be expected—under global warming theory—that cold-related deaths should have declined and heat-related deaths should have increased across the length of the record. But did they?

As shown in the figure below, cold-related death rates did indeed decline (by 49.3%), from approximately 21 deaths per 1,000 persons in 1976 to 10.6 deaths per 1,000 in 2010. Heat-related death rates, however, did not increase. Rather, they too declined, from 13.2 in 1976 to 8.10 in 2010 (a decrease of 38.8%). Thus, despite an average rise in mean temperature of approximately 0.20°C per decade, and counter to global warming theory, both cold- and heat-related death rates declined over the 35-year period of study, which finding lead the two authors of this study to conclude “Hong Kong has not observed an increase in heat-related deaths as predicted in the Western literature.” And that is great news for the elderly population of this famed city who have little to fear about alarmist projections of the future health-related impacts of global warming.

Summer (red line) and winter (blue line) age-standardized mortality rate (per 1,000 population) for adults age 65 and older in Hong Kong over the period 1976-2010. Adapted from Chau and Woo (2015).


Chau, P.H. and Woo, J. 2015. The trends in excess mortality in winter vs. summer in a sub-tropical city and its association with extreme climate conditions. PLoS ONE 10: e0126774. doi:10.1371/journal.pone.0126774.

Tonight, starting at 6:00 p.m. EDT, CNN will host two nationally televised debates featuring candidates for the Republican nomination for the 2016 presidential elections. Though widely regarded as the “second” debate of this election season, those of you who have been following Cato coverage will recognize tonight’s broadcasts as the fourth and fifth debates of Campaign 2016.

Cato scholars will be on hand to live-tweet both debates, bringing insightful commentary and hard-hitting policy analysis to the discussion. Follow tonight’s live-tweeters and join the conversation on Twitter using #Cato2016.

Similar to the Fox debates, the split in candidates will be based on average scores from national poll results spanning a two-month period ending last Thursday, with candidates required to average at least 1 percent support in three polls to qualify.

The first debate will feature Rick Santorum, Bobby Jindal, George Pataki, and Lindsey Graham. Then, at 8:00 p.m. EDT, Donald Trump, Jeb Bush, Scott Walker, Mike Huckabee, Ben Carson, Ted Cruz, Marco Rubio, Rand Paul, Chris Christie, John Kasich, and Carly Fiorina will take the stage.

Although CNN had originally intended only to include the top ten candidates in the later debate, an exception was made for Fiorina, whose performance in the first Fox debate helped her move into the top ten in polls conducted after that broadcast.

Candidates positions on the stage will be based on their overall rankings, with Trump—flanked by Carson and Bush—front and center for the primetime debate.

Former Virginia governor Jim Gilmore, who garnered 1 percent support in only one poll during the two-month window, did not meet the criteria for inclusion.

Join the conversation tonight on Twitter with #Cato2016.