Obama's Trade Rep admits pandering

I do appreciate the public choice ramifications of democracy, but I still don't totally understand why things like this happen mere months after a president takes office, during a crisis that few believe will still be with us during the run-up to the 2010 election:

[Probable U.S. Trade Representative] Kirk [...] is viewed by many as a pragmatist who in the past has supported the notion of free trade.

Yet the administration, analysts say, is also up against an American public that is increasingly blaming the open U.S. trade policies of the past as part of the toxic mix at the root of the nation's economic problems. Kirk suggested as much yesterday.

"It is true that cheaper foreign products helped squeezed American families stretch their dollars, and the sale of our goods and services abroad support American families," he said. "But it is also true that the overarching benefits of trade are difficult to appreciate when a plant closes in a small community because of increased foreign competition."

Take out the words "families" and "community," and that looks like it could have come straight out of a public choice textbook arguing why inefficient interest group politics are inevitable in a democracy.

Also, I'd be interested to know, before the dawn of the eternal election campaign, were presidential administrations less likely to engage in this sort of blatant populism early on in their terms? I suspect the answer was no, which sort of invalidates the premise of the question – i.e., the eternal election isn't really a modern invention.

Dying on the floor of the Senate

So I know that when two old geezers almost die during an inaugural luncheon you're supposed to act solemn and respectful, but my only feeling is contempt for people who feel so entitled to their job that they remain in office so long after their health has clearly precluded them from serving effectively. Do they honestly think that they – with their seats guaranteed to their parties – are really so indispensable that some other toe-the-line Democrat couldn't do it just as well?

It's ridiculous that they're still in office, but not at all surprising. Each successive wave of Kennedys seems to feel more entitled than the last, and all the pre-death eulogies and paeans to the glory of the Kennedy dynasty aren't making Ted Kennedy's ego any smaller. And then there's Robert Byrd, former Exalted Cyclops in the Ku Klux Klan, who as late as 2001 was on Fox News talking about "white niggers."

Andrew Cuomo pissed that Caroline Kennedy stole his Senate seat

New York Attorney General Andrew Cuomo is apparently pretty pissed that Caroline Kennedy has emerged as a frontrunner to fill Hillary Clinton's Senate seat, since he's evidently been eyeing a Senate seat for a while. While he obviously has more experience than Caroline Kennedy, Andrew Cuomo's pedigree is nothing to laugh at: he's the son of a former New York governor, and up until his 2003 divorce from one of RFK's eleven children, he was Caroline Kennedy's nephew-in-law.

And as much as I hate aristocracy, I can't say that I feel bad for Cuomo – he had perhaps the single largest individual role in the subprime collapse in his capacity as Clinton's HUD secretary from 1997 till 2001, leaving aside maybe Alan Greenspan.

Something interesting also to note is that the three biggest winning personalities this electoral season (all senators, I might add) – Obama, Biden, and Clinton – have all had their former senate states shrouded in mystery and intrigue. Obama's seat led to the undoing of Illinois Governor Blagojevich, and Clinton's new job as Secretary of State led to Caroline Kennedy's interest in the newly-vacated seat and the ensuing uproar. Joe Biden's son Beau (current Attorney General of Delaware), who has been rumored as a possible replacement for Joe Biden's senate seat, has taken the (sort of) high road and stayed out of the running for the unelected seat, and instead might run in an actual election in 2010 – made easier by the fact that the person appointed to Joe Biden's old seat, Ted Kaufman, was Joe Biden's former chief-of-staff and has stated that he doesn't intend to run to keep the seat in 2010.

Reason.tv on Blagojevich

From reason.tv, this is the best explanation – in print or video – of the Blagojevich scandal and corruption in Illinois politics that I've seen yet.

And a note to all TV personalities out there: Blagojevich is a Serbian name and uses a Serbian transliteration where j makes the sound normally reserved for y in English (as does German and Polish). It's not that hard of a concept to wrap your mind around – get over the damn name.

Senate seat sale an open secret?

Via Talking Points Memo, the sad truth about Blagojevich's corruption as reported by the NYT:

“It was open knowledge among people in and around Springfield,” Mr. Raoul said. “Legislators and lobbyists alike openly talked about the fact that the governor would want to appoint somebody who would benefit him. I can firmly say that I’ve had these conversations, that I’ve spoken with both legislators and lobbyists who felt that that would be the consideration in his appointment.”

Democrats gloats, say stupid things

Over at Talking Points Memo, John Marshall publishes an e-mail in which a fellow Democrat pontificates on the fall of the Republicans from electoral grace, and the letter ends with the line: "Voters have little patience for politicians who seem blind to their own mistakes," to which John Marshall responds "True," without qualifications.

Seriously?! The median voter has very little actual understanding of the economy. They might have little patience for people they perceive as blind to their mistakes, but to say something that implies that voters don't tolerate bad governance is just laughable from their elected officials is just ridiculous.

Public ranting sessions in NYC

The NYT has a funny and interesting article on a peculiar New York City custom: allowing any and all citizens to have their say about a law at its signing. In this case, Mayor Bloomberg had to endure four hours of public comments by people supporting and opposing (apparently in equal measure numerically, but I'm not sure about time-wise) the City Council's recent vote to give Bloomberg a shot at a third term. This goes against the result of referenda in 1993 and 1996, when New Yorkers voted to impose the current limits, though Bloomberg argued (and a bare majority of the City Council agreed) that the financial crisis obliges him to seek another term in office. The Times has a little history on the city's practice:

The tradition of allowing the public to speak before a bill is signed dates back at least as far as the 19th century, and has been known to sway a mayor. Once, after hearing hours of fiery testimony in 1897, Mayor William L. Strong vetoed a bill regulating sidewalk vendors.

I like the example they chose, and I think the practice would be particularly useful with regards to those sorts of anti-libertarian laws that largely affect individuals, small businesses, and generally groups without access to lobbyists. Maybe it would have stopped Los Angeles from passing this law affecting food vendors in that city.

Then again, maybe not – I imagine that if there were any modern instances of mayors or council members changing their minds after hearing public comments, the Times would have mentioned them.

Greenspan accepts responsibility for all the wrong reasons

Alan Greenspan has come under scrutiny in the House today, being compelled to declare his culpability in the ongoing subprime mess. But what's so backwards about the whole thing is that he's being lambasted for his anti-regulatory stances, but not his years of keeping the interest rate below inflation, effectively meaning a negative real interest rate. Low interest rates supposedly buoy an economy in bad times, but can result in asset bubbles – and especially in the most valuable and long-lasting assets: houses. But no one seems very interested in taking the Fed to task on its interest rate policy – just raking it over the coals for not trying to reserve consequences of bad monetary policy, rather than attacking it for creating the bad monetary policy in the first place. And the saddest part is that Greenspan is all too willing to take responsibility for not regulating the market enough, but has shown no contrition for (and isn't being asked to by Democratic Rep. Henry Waxman, who's leading the lynching) his monetary policy, and appears to genuinely believe that lack of regulation, rather than monetary policies (among other things), were what threw the market so far off balance.

The Orange Revolution turns red

I haven't posted much about the political crisis in Ukraine, because I thought it was pretty cut and dry, and I sort of forget that not everyone follows Eastern European politics as closely as I do. So, essentially what has happened is that the South Ossetian war has frightened the people of Ukraine, as well as its political establishment, and the already shaky "Orange" liberal coalition partners – Yushchenko and Tymoshenko – have been divided. Tymoshenko and her bloc refused to share in Yushchenko's condemnation of the Russian actions in Georgia, and she's given in to the heavy pressure to ally herself with Russia, at least for the moment. Ukraine has a sizable Russian minority, and an even larger amount of people in the eastern half of the country who have pro-Russian sentiments. Crimea has a bare Russian majority, and is home to Russia's formidable Black Sea Fleet, and as such could be vulnerable to the same sort of Russian revanchism that happened in Georgia.

Anyway, President Yushchenko has dissolved parliament, and new elections will happen in a few months. Tymoshenko's political stars are clearly on the rise, and in the midst of the crisis she's been to the Kremlin to negotiate Ukraine's natural gas deals with Russia, an issue near and dear to Ukrainians' hearts since Russia shut off gas pipes to Ukraine around New Years 2006. While in Moscow, Tymoshenko pushed for closer ties between the two countries' big state energy concerns – Naftogaz and Gazprom. This was seen as a power play by Yushchenko's supporters, as it came in the middle of this political crisis that was directly related to Ukraine's relations with Russia, and tensions flared when Yushchenko's supporters alleged that Tymoshenko really went to Russia to get the backing of the Russians, who still play a very active role in Ukrainian politics.

According to Stratfor, Russia's got a "wild card" up their sleeve in the form of Ukraine's richest oligarch, Rinat Akhmetov, who is apparently the "puppetmaster" behind Ukraine's large pro-Russian Party of Regions. Stratfor says that his power over Ukrainian politics has "grown exponentially" in recent years, and that ultimately he is "firmly held by the Kremlin," which very well might use him to seal the deal in the December elections. Though at the rate it's going – with Tymoshenko having defected, and Yushchenko's approval ratings below 10% – they might not even have to use him.

Romney's VP stock skyrockets

To continue with the other day's topic of prediction markets and what they have to say about the veepstakes, Mitt Romney's stock just recently shot up to way over 50 cents on the dollar. Right before Obama's announcement, Romney was trading on Intrade at about 25. At the moment, the last trade was at 62.2. Considering there's nothing in the news about Romney to propel his stock, it must have been something about Obama's pick that made the markets all of the sudden go crazy over Romney.

What do the prediction markets know that pollsters don't?

Sorry to bring up something as profane and childish as electoral politics here (normally I try to hold myself above the usual CNN Airport Network fare), but I've noticed that despite the fact that the polls are showing Obama and McCain in a statistical dead heat, the prediction markets are still betting on Obama by a fairly wide margin. National polls show Obama's lead over McCain narrowing to between 2 and 5 percentage points, but contracts that pay $1.00 if Obama wins are going for about $0.60 on Intrade. It's possible that the polls show the individual state contests playing out so that Obama is way over McCain in the electoral college vote, but I doubt it – seems more likely that the bettors think they know better than the pollsters. And though the polls were taken before McCain's statement about not knowing how many houses he owns, the prediction markets have been at 60% for Obama for a while now. And before you blame immature and small markets for the discrepancy, note that betting volumes are much higher than they were in 2004.

And for those interested in what the markets have to say about Obama's vice presidential pick, Joe Biden's contract is trading at 41.4, Evan Bayh's at 24.2, Tim Kaine's at 12.0, Wesley Clark's at 8.7, and Senator Clinton's at a lowly 12.0. On the Republican side, Pawlenty and Romney are tied at about 25 each.

Mass. citizens almost certain to decriminalize marijuana

Here's something you don't see every day: Massachusetts residents, according to a poll, are poised in November to vote 72% in favor of decriminalizing marijuana. What this is entails is removing criminal penalties as a punishment for being caught with less than an ounce of pot, and making instead making it a civil matter and fining the possessor $100, in addition to seizing the weed.

A similar measure proposed by Mass. Democrat Rep. Barney Frank and Texas Republican Rep. Ron Paul will be put to a vote in the US House of Representatives, but is almost certain to die without much support. Interesting how outcomes differ when you put issues to a direct vote, and when you use elected representatives as a proxy will of the people. Makes you wonder how representative our representative democracy really is.

British anti-drug director for legalization

Sorry for the slew of drug-related posts, but this one was just too good to ignore. From the Guardian:

A former senior civil servant who was responsible for coordinating the government's anti-drugs policy now believes that legalisation would be less harmful than the current strategy. Julian Critchley, the former director of the Cabinet Office's anti-drugs unit, also said that his views were shared by the "overwhelming majority" of professionals in the field, including police officers, health workers and members of the government.

He also claimed that New Labour's policy on drugs was based on what was thought would play well with the Daily Mail readership [ed. note: like Fox News in the US], regardless of evidence of what worked. Downing Street policy advisers were said to have suggested stunts such as sending boats down the Thames to catch smugglers to coincide with policy announcements. [...]

He said that his views were widely held in the government but rarely expressed in public. "I think what was truly depressing about my time in UKADCU was that the overwhelming majority of professionals I met, including those from the police, the health service, the government and voluntary sectors held the same view: the illegality of drugs causes far more problems for society and the individual than it solves. Yet publicly, all those intelligent, knowledgeable people were forced to repeat the nonsensical mantra that the government would be 'tough on drugs', even though they all knew the government's policy was actually causing harm."

Tripping with cancer

The Guardian has an article on recent experiments with hallucinogenic drugs being conducted by scientists, basically the first since the 1970s. LSD for some reason had a very negative reception when it first because popularized, as did MDMA (ecstasy) later on. But what's striking about the trials is not what they're studying, but that they're studying the exact same things that were being studied over three decades ago. That is, because of the restrictions placed on researchers and the government's quasi-monopsony power over scientists through research grants, this promising area was left untouched for a very long time. The ailments that hallucinogens might help are mainly in the psychological field – the article focuses on the post-trip clearness that terminal patients feel after being given a dose of either LSD (acid) or psilocybin (magic mushrooms). It's pathetic that the drug scare has taken this long to get over among the medical establishment, let alone among politicians and voters.

Republicrats

Just to hammer home the incredibly similarity of America's only two parties*, the Tax Policy Center lays out the costs of of both presidential candidates plans for America:

TPC estimates that in 2013, Obama would collect revenues of 18.2 percent of GDP. McCain would bring in about 17.8 percent. Spending that year would be about 19.5 percent, according to the Congressional Budget Office, assuming the Iraq war will be winding down.

That's a difference of 0.4 percentage points in GDP. And it's important to measure spending and not revenues, because any deficit spending will result in inflation, which acts as a only vaguely-recognized tax on American citizens, but also anyone else who owns dollar bills.

*Sorry, third parties, but America's voting system is stacked impossibly against you. If another party enters the scene, it won't be as a third party, but as a future member of the two-party system, like it always has been.

Conservatives come out against universal suffrage

Lately I've heard two conservatives opine on the topic of suffrage, both arguing that we ought to disenfranchise certain groups because of how they vote. The first was Ann Coulter, who in 2007 declared that disenfranchising women is "a personal fantasy of mine," because "we'd never have to worry about another Democrat president." Blogger Megan McArdle correctly stated that Coulter got away with this because she is a woman. Recently, Pajamas Media (a blogging network of diverse opinions) contributer Burt Prelutsky opined that teenagers ought to have their right to vote taken away, basically for the same reason: they vote Democratic. He can get away with this because teenagers are pretty much universally reviled, and the "get off my lawn!" faction of American politics is pretty strong (excellent perennial vote-getting strategy: say that kids these days need some sort of character-building, and then advocate some sort of civil service draft). But they're both barking up the wrong tree: black Americans are much more likely to vote Democrat than teenagers or women. But I guess that's just a little too un-PC, even for Ann Coulter.

A vote against Europe is a vote for capitalism...and a vote for socialism

The Irish, following in the footsteps of the French and Dutch a few years earlier, have rejected the Lisbon Treaty – essentially the EU Constitution in not so many words. The process strikes me as totally antidemocratic – the Dutch and French rejected it last time, so their governments didn't put it up for popular vote, and Ireland was the only country in the 27-member supranational union to put the vote to the people. But anyway, what interested me the most is how different groups lobbied against the proposal for seemingly contradictory reasons. The pro-business ad-hoc anti-treaty group Libertas fought for a no vote by warning of "inflexible regulation," "back doors to increased taxes," and fears of Brussels meddling with FDI, while the leftist/nationalist Sinn Féin party argued against the treaty with socialist arguments like:

Sinn Féin today claimed the Lisbon treaty would have serious consequences for Irish public services by advancing the liberalisation of that sector.

Speaking at Leinster House, Sinn Féin health spokesman Caoimhghín Ó Caoláin said there was a “clear desire” within the European Commission and many EU governments to open members’ markets in public services such as health and education to competition.

He warned there were “clear consequences” when such public services are opened up to competition.

“Treating health care or education as commodities to be traded on the market creates inequalities in access to public services. . . . Opening public services to competition actively undermines universal access to healthcare, and forces reliance on private insurance.”

Mr Ó Caoláin said such liberalisation puts downward pressure on wages.

“It also undermines the long term viability of the public sector, as the private sector cherry picks the most “profitable” sectors, thus undermining vital revenue streams through which the public sector subsidies the unprofitable sectors.”

Courts reflect popular opinion, not law

This horse has been beaten to death by the libertarian blogosphere, so I won't spend too much time on it. But, as a recap: California Prop. 98 and 99 were on the ballot, with 99's supporters claiming that 98 was a back-door method of ending rent control, and 98's supporters accusing 99 of not truly protecting property rights, given that it only protects the rights of owner-occupied homes. 99 won, and 98 lost. These dueling property rights referenda were all driven by the Supreme Court's massive expansion of the government's power to use eminent domain in Kelo v. New London, which gave it the power to condemn for not only public works projects, but also for private redevelopment.

But anyway, that's not what I wanted to talk about. What I wanted to talk about was this little bit from Timothy Sandefur's blog:

If you are still confused, or don't trust Prop. 98, at least vote no on Prop. 99. It would make things far worse not only by providing fake protection, but because the courts would interpret it as meaning that Californians did not want more serious protections for property rights.

The implication is that the courts reflect popular opinion on constitutional matters, which on its face seems to be a violation of the principle of the courts as a neutral interpreter of the law and the constitution, and as a restraint on legislative and popular power. Constitutions are protections of citizens' rights against the government, and they are supposed to protect us as much from the popular sentiment of voters as from the government itself. Of course, to anyone who knows anything about the history of American judiciary, this shirking by the courts from their role as counterweights of popular opinion is nothing new. But, just in case you didn't realize it, this ought to be one more nail in the coffin of the neutral judiciary.

Edit: Apparently, my legal knowledge is lacking. See Timothy Sandefur's response in the comments section for clarification...

Bolivia's eastern regions chafe under socialist rule

In Bolivia, an interesting battle is brewing between the wealthy, more European-blooded residents of the eastern states and the poorer, indigenous-blooded residents of the western part of the country. Bolivia's president is Evo Morales, a dark-skinned socialist who rose to power on the back of anti-capitalist discontent and Hugo Chávez's aggressive push to turn his corner of the world red. The struggle's latest incarnation is a series of referenda for more autonomy for the western states, whose main center is in Santa Cruz:

As presidents from Venezuela to Ecuador and Bolivia vow that they, for the very first time, are governing for the poor, the oppressed, and the indigenous, Latin America is in the midst of a power struggle. Conservative leaders say it is their new responsibility to double up efforts to stem the tide of Mr. Chávez and his leftist coalition – which they claim is not addressing the welfare of those most in need, but attempting to consolidate power and undermine liberties across the region.

"We don't want this to end here," says Carlos Pablo Klinsky, the president of the caucus of legislators in Santa Cruz who helped usher in the autonomy referendum. On Sunday, Bolivians in the Amazonian states of Beni and Pando overwhelmingly voted for more autonomy. With three victories and a fourth vote planned for June 22, Bolivia is emerging as an epicenter of a growing pushback against Latin America's left.

Competitive bidding, with a congressional touch

The Philadelphia Inquirer today printed an entirely uncritical story on Lockheed Martin's latest coup: winning a $1.46 billion contract from the federal government to build new, more precise GPS satellites. Of course, being a local paper, the Inquirer highlights mainly the economic boon that the project will be to the region. It unflinchingly reports that US Rep. Patrick Murphy "worked to steer the project to his district as a member of the House Armed Services Committee," without mentioning the paradox of putting a contract up for competitive bidding and then having a member of a powerful House committee "steer the project to his district." 30% of the project will be completed in Lockheed Martin's facility Bucks County, and an unspecific portion will be built on Lockheed Martin's campus in King of Prussia – both in the suburbs of Philadelphia. I wonder why the 30% number for Bucks County was disclosed, but not the amount to be manufactured in King of Prussia? And why the Bucks County facility was so quick to remind the media that the jumbo-sized contract would create 400 or 500* new jobs? It just might have something to do with the fact that Democrat Patrick Murphy represents Bucks County in the US House!

* In case you were under the impression that Philadelphia had serious media organizations, think again: a very short article in the Philadelphia Business Journal says in the headline that the "[c]ontract will add 400 jobs to Lockheed Martin's Newtown plant," while in the article stating that "[w]inning the contract will mean the addition of 500 jobs." There is no explanation of the discrepancy, though the difference could be made up in facilities other than the one in Newtown Square.