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The House takes a small step to make Congress great again

3 hours 3 min ago

Something remarkable happened a week ago: a committee in Congress voted to spend a little bit more money on congressional staff. Rep. Sam Farr, D-Calif., offered the amendment to a spending bill, which was approved overwhelmingly by voice vote.

Cynics in the audience may snort and scoff, “Well, what’s new? Those fat cats are always lining their own pockets!” The view that Congress splurges on staff may be widely held in this country.

The facts are otherwise. Adjusted for inflation, spending by the House of Representatives on staff has declined since 2001, according to the Congressional Research Service.

The cost of living in the D.C. area is sky-high and congressional staff tend to quit the Hill after a couple of years for more lucrative work (often for lobbying firms and interest groups). To pay for this tiny raise, the House did not reach deeper into the public’s pockets. Instead, it chose to defer spending on the upkeep of the Capitol building and grounds.

Each member of the House of Representatives receives a chunk of change to spend on staff. Farr’s amendment raised that amount by 1.5 percent. According to Demand Progress’ Daniel Schuman, this increase amounts to about $18,000 for each congressional office. But don’t get the idea that any staffer is getting rich. The raise will be spread among the 18 staff in each office and will be reduced roughly 25 percent to 35 percent by federal and state payroll taxes. The effect on take-home pay will be tiny, but something beats nothing. Perhaps it will help slow the staff- and brain-drain from Congress.

Democrats supported the Farr pay amendment, but so did staunchly fiscal conservative Republicans. The very conservative Texas Republican John Carter voted for it. Rep. Steven Palazzo, R-Miss., stood and spoke strongly in favor of it, noting that Congress needs staff to serve constituents and “do our jobs.” Lest anyone imagine Rep. Palazzo is a RINO (“Republican In Name Only”), he’s the same congressman who gave copies of the Bible to his 534 fellow legislators and asked them to draw upon it for guidance in governing. He also scores well on the various conservative voting scorecards.

That conservatives supported the pay measure actually makes perfect sense. Many on the right are very concerned that the massive growth of the executive branch has thrown the separation of powers out of balance. As constitutional literalists, they are aghast that agencies enact laws more often than our national legislature, despite Article I of the Constitution’s declaration that: “All legislative Powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives.”

In hopes of reversing the recent diminishment of Congress, conservatives such as Sen. Mike Lee, R-Utah, recently have launched movements to re-establish Congress as the first branch of government. (Disclosure: R Street Institute has partnered with New America to study ways to increase legislative capacity.)

The odds are good that the House pay raise will become law. Whether the Senate will follow suit and treat its employees less stingily remains to be seen.

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

As rocket wars wage in DC, a cautious move towards competition makes sense

4 hours 30 min ago

On the morning of Aug. 12, 1998, a Titan IV-A rocket exploded about 40 seconds after launch. The explosion – caused by a short circuit in the guidance system –destroyed a top secret “Mercury” spy satellite as well as the launch vehicle. The cost was roughly $1 billion.

When it comes to American access to space, the margin for error approaches zero. Unfortunately, that’s about the only point where Congress agrees right now when it comes to America’s military launches.

Rocket wars are raging in Washington, and they’re launching arguments with significant national security implications.

On the one side are Sens. Richard Shelby, R-Ala., and Dick Durbin D-Ill.; on the other is Sen. John McCain, R-Ariz. Most elected officials seem to fall in one of two corporate camps. Shelby and Durbin, for example, generally back the United Launch Alliance (ULA), and McCain is similarly supportive of SpaceX. Parochial economic interests play an important part as well. For instance, Shelby represents 850 or so employees at ULA’s Decatur, Alabama, assembly facility. You can bet they’re paying attention to the current policy debate.

ULA and SpaceX aren’t exactly household names. ULA is a joint venture of Lockheed Martin and Boeing that’s held a virtual monopoly on military space launches from its creation in 2006 until the U.S. Air Force awarded SpaceX a GPS satellite launch contract in 2016. SpaceX is the brainchild of PayPal co-founder Elon Musk who also serves as CEO of Tesla Motors and chairman of SolarCity.

For these companies, billions of dollars are at stake, and SpaceX is pulling out all the stops to break into ULA’s market dominance.

To put it mildly, the policy battle is about as complicated as the rocket science behind the companies.

To ULA’s credit, the company has successfully launched more than 100 rockets without incident. But they’ve also been given vast resources to do so. For example, McCain refers to ULA’s Evolved Expendable Launch Vehicle (EELV) launch capability contract as “$800 million to do nothing.” That’s not exactly fair, since the contract gives the Air Force tremendous launch flexibility, but $800 million a year effectively to be ready to launch seems tremendously generous.

The EELV contract also points to the problem with a lack of competition: We don’t actually know if the price is right. ULA could be helping the Air Force realize significant savings. Taxpayers and legislators simply don’t have a competitive comparison to know whether that’s true. According to a recent Congressional Research Service (CRS) report by Steven Hildreth, “Much of the detailed cost data are proprietary, not readily comparable, and some are speculative to the extent that there is little operational empirical data on which those costs are provided.” In other words, ULA essentially holds a “just trust us” relationship with the federal government.

The tax dollars have, however, generated an impressive track record that ULA supporters are happy to contrast with SpaceX’s relatively few launches. In particular, ULA proponents point to a total mission failure experienced by SpaceX in 2015, when a Dragon rocket disintegrated as it carried cargo to resupply the International Space Station (ISS).

ULA’s pristine track record is due in large part to its creation after the companies that formed it worked out the kinks. For example, the United States lost three military satellites due to failed launches from 1998 to 1999, at a cost exceeding $3 billion. One of those, a failed Titan IV (Lockheed) launch in 1999 carried a critical national security communications satellite. The communications capability it would have provided wasn’t replaced until 2010.

SpaceX bounced back from the 2015 launch failure with flair. It stuck the landing of a Falcon 9 rocket booster on a drone ship at sea after a successful ISS resupply launch.

The upstart rocket company isn’t content with ULA’s table scraps either, and they’ve proven willing to punch the incumbent ULA square in the nose on everything from litigation to public relations.

Stick with me here, because this isn’t going to get less complicated. Rockets are made of two basic pieces: the vehicle and the engine. ULA’s Atlas V rocket uses a Russian-made engine called the RD-180. The engine is the progeny of efforts to keep Russian scientists U.S.-focused after the Cold War. For the better part of a decade, the engine’s use wasn’t particularly controversial. Then Vladimir Putin happened.

In May 2014, Putin’s deputy prime minister, Dmitry Rogozin, engaged in a little saber-rattling by announcing, “Russia will ban the United States from using Russian-made rocket engines for military launches.” Back to the point about ensuring American access to space. If Russia made good on its threat, the lack of RD-180s would effectively ground ULA’s Atlas V rockets. As a result, the United States has been forced to rethink its dependence on the RD-180.

In a politically savvy move, SpaceX and its proxies are hammering ULA as a cronyist propping up the Putin regime with purchases of the Russian engines. Obviously, it’s not a disinterested argument since SpaceX isn’t lobbying to end the billions the United States spends on importing Russian oil, crustaceans, weapons and other items. The United States isn’t going to make or break Putin with our rocket purchases, but he does appear to have a potential avenue to hamper our military’s space access if he’d like.

SpaceX allies want to curb purchases of the RD-180, and it’s not simply a matter of patriotism. Wouldn’t you like to start a race by literally having officials limit the use of or ban altogether your chief competitor’s engine? That’s a serious leg up if you can swing it. ULA obviously has a different perspective. They’d like to see a domestic replacement of the RD-180 developed, while phasing out the Russian engine over a longer period of time.

In the interim, SpaceX supporters have argued that the Air Force could end reliance on the RD-180 by using SpaceX’s Falcon 9s to handle the majority of national security payloads and ULA’s Delta IV rocket for the rest. That argument conveniently ignores that the Delta IV is significantly more expensive to launch than the Atlas V, because it’s designed for the military’s heaviest payloads.

According to the Hildreth CRS report, “Even with a smooth, on-schedule transition away from the RD-180 to an alternative engine or launch vehicle, the performance and reliability record achieved with the RD-180 to date would likely not be replicated until well beyond 2030.” In short, the RD-180 is a reliable engine, and it’s probably not going to be easy to replace quickly.

The report also notes several factors in the rocket wars that could ultimately undermine American access to space: RD-180 access ends, ULA discontinues the Delta launch vehicle, either ULA or SpaceX have trouble certifying their next generation of launch vehicles or ULA’s next generation engines aren’t developed in a timely fashion.

Those conditions represent plenty of room for potential error on launches that America needs to be almost as certain as death and taxes.

In spite of the complexities, competition is almost always good for the folks paying the bill – in this case, the U.S. taxpayer. At the same time, we should be sure we’re able to reliably ensure continued access to space before shifting the playing field. It’s a tough call for Congress and the president to determine what that transition looks like, because it’s a high stakes market with few customers and even fewer vendors.

The rocket wars also raise significant questions about defense and national security procurement. We have a habit in defense procurement of paying multiple companies to develop a product that they then sell to us. Cozy corporate relationships with the Pentagon are seldom in the taxpayers’ interest. In spite of how our nation has operated for quite some time, national security and fiscal prudence aren’t mutually exclusive, even with the capital-intensive nature of projects and the need for confidentiality.

The rocket wars will likely continue, but heading toward competition is likely more important than the specifics of how we get there or how long it takes. We need a more competitive rocket market, a smarter acquisition strategy and downward pressure on the costs being born by taxpayers. ULA will have serious competitive advantages as the market incumbent and their rockets may well be able to produce the best results for our nation. Rather than taking ULA’s word for it, the company should have a chance to prove it with a competitor like SpaceX increasingly nipping at its heels.

Can Puerto Rico be saved?

9 hours 42 min ago
06/08/2016 - 10:00 am - 11:30 am
American Enterprise Institute
1150 17th St. NW
Washington

Coalition opposes Section 236 in the Transportation, Housing and Urban Development appropriations bill

May 24, 2016, 12:42 PM

Dear Representative,

We, the undersigned groups, representing professional floodplain managers, insurance companies, fiscal conservatives, and environmental groups oppose inclusion of Section 236 in the Transportation, Housing, and Urban Development (THUD) appropriations bill that will waste federal taxpayer dollars by putting federally owned or funded facilities in harm’s way.

Section 236 would effectively block the Department of Housing and Urban Development (HUD) from implementing Executive Order 13690, which updated the federal flood protection standard to better prepare and protect the Nation from future floods and coastal storms. The federal flood protection standard, also referred to as the Federal Flood Risk Management Standard, will ensure that federal taxpayer-funded facilities and infrastructure are built with a higher level of resilience to flood-related damages either through locating them outside of areas vulnerable to flooding, or taking other measures like building to a higher elevation or floodproofing.

As written, Section 236 would force HUD to map every floodplain in the United States before it could implement this commonsense flood protection measure. This mapping requirement would not only be extremely costly to the American taxpayer, but would be redundant and unnecessary. The Federal Emergency Management Agency (FEMA) already provides floodplain maps for communities in the nation and according to the Association of State Floodplain Managers, the total cost to provide up-to-date flood maps for all communities is between $4.2 and $7.5 billion. Section 236 would impose the same if not greater cost on HUD to carry out essentially the same task, which would be compounded by HUD’s lack of flood mapping expertise. Thus, Section 236 is a ploy to block HUD’s implementation of the flood protection standard. Blocking implementation of the standard hurts taxpayers and increases the nation’s vulnerability to costly and environmentally damaging flood events. In contrast, implementation of the flood protection standards and E.O. 13690 would save taxpayer dollars by requiring federally-funded infrastructure to be more resilient to future flooding and reducing the amount spent to repair, rebuild, and replace public facilities post-disaster.

Since 1998, FEMA has spent $25.6 billion on Public Assistance grants to repair or rebuild public facilities, buildings, and infrastructure that have been damaged by floods and coastal storms. Costs to repair and rebuild would be lessened in the future under E.O. 13690 and the flood protection standard and, most importantly, we would ensure that federally funded facilities and infrastructure are built with escalating future flood risks in mind.

Flooding is the most common and costly natural disaster in the United States. Dollar losses due to tropical storms and other flood events have tripled over the past 50 years, and currently comprise more than half of all natural disaster losses. Flood losses in the United States are projected to worsen in the coming decades, putting more people and property at risk. Unfortunately, while the federal spending post-disaster has dramatically increased over the last few decades, spending on proven, pre-disaster planning and mitigation still falls woefully short of what is needed to better protect people and their property. We know that mitigation, and smarter and safer building protects people and their property. For every one dollar spent on disaster mitigation, four dollars are saved on post-disaster recovery and rebuilding.

The flood protection standard will better protect people and property from harmful flooding in areas that face flood risks. The standards will require Federal agencies to incorporate the best science on flooding in making siting decisions, and require structures receiving federal funds to build to safer levels of flood protection and resilience. Under the flood protection standards, federal investments will be better designed, better built, and better protected from floods today and in the future. When federal funds are being used to build, rebuild or subsidize structures, the government owes a duty to the taxpayer that investments are being made in safe, sustainable, and resilient ways. HUD’s implementation of the standards, and other agencies’ implementation, will help meet that duty.

Pre-disaster mitigation efforts, which include building to a higher standard, are proven to reduce the associated costs of post-disaster recovery. Agency implementation of the federal flood protection standards will yield enhanced protection to people and property, result in cost savings on damages avoided, and lead to environmental improvements. Thus, we urge you to join is in opposing inclusion of Section 236 in the final THUD appropriations bill.

Sincerely,

Chad Berginnis, Executive Director, Association of State Floodplain Managers

Rob Moore, Senior Policy Analyst, Natural Resources Defense Council

Eli Lehrer, President, R Street Institute

Franklin W. Nutter, President, Reinsurance Association of America

13 orgs to Energy and Commerce Committee: Support the Consumer Review Fairness Act

May 24, 2016, 12:32 PM

Dear Chairman Burgess and Ranking Member Schakowsky:

Each day, online review sites encourage millions of Americans to share their experiences and opinions on the businesses and services they depend on; and nearly 70% of customers say that they rely on these sites before making a purchase. By educating consumers and informing their decisions on everything from what doctor to visit to where to shop, eat or stay, online consumer reviews have become an important fixture in our everyday lives.

Unfortunately, their integrity is in danger. Businesses are increasingly employing gag clauses, hidden in non-negotiable form contracts, in an effort to silence consumers. These clauses are used to limit a customer’s right to free speech, penalizing or fining those who wish to share a negative experience with others in an online review.

These gag clauses allow bad businesses to bully their clientele into silence, inhibiting citizens’ abilities to both share their experiences online and learn from the experiences of others. To combat these efforts to stifle free speech, we are joining together to express our support for the Consumer Review Fairness Act (H.R. 5111), legislation that will help protect consumers’ right to share legitimate speech online and off.

This critical legislation, sponsored by subcommittee Vice Chairman Rep. Leonard Lance (R-NJ), will prohibit the use of gag clauses in consumer contracts nationwide, strengthening our First Amendment right to free speech. Prohibiting these clauses will make it more difficult for businesses to intimidate and muzzle honest reviewers and easier for those who wish to share their experiences and opinions online without fear of retaliation. Further, this legislation will ensure American businesses are held accountable to the public, thwarting deep-pocketed bullies from silencing their critics.

Today, our state laws do not equally protect the free speech rights of all Americans. The Consumer Review Fairness Act will resolve the patchwork of contradictory state laws, creating a national standard that will preserve the free speech rights of all American consumers, no matter their home state.

We thank the Subcommittee on Commerce, Manufacturing, and Trade for holding this important hearing and look forward to continuing our work with the Committee to ensure this legislation advances to the benefit of American consumers.

Respectfully,

Computer & Communications Industry Association

Fight for the Future

Internet Association

Public Knowledge

R Street Institute

TechNet

Yelp

Engine

Glassdoor

Media Law Resource Center

Public Participation Project

RealSelf

TripAdvisor

 

 

 

R Street Institute to Congress: Vote NO on H.R. 4889, the Kelsey Smith Act

May 23, 2016, 2:37 PM

The R Street Institute encourages all members to vote no on H.R. 4889, the Kelsey Smith Act. This bill is expected to be considered under suspension of the rules this evening: Monday, May 23, 2016. The proposed legislation creates an unprecedented loophole to our Fourth Amendment right to privacy. It enables law enforcement to compel cell carriers to disclose user-location information without a prior court order when they believe there is an “emergency” situation.

The legislation’s goal is laudable – to help find people deemed to be in “emergency” situations. But granting law enforcement extraordinary abilities to obtain cell data without receiving a probable-cause warrant from a judge is yet another expansion of government surveillance power. Such expansions may infringe the Fourth Amendment rights of the very citizens the police may want to help

While written with the best intentions, this bill would breach the privacy of millions of Americans by giving law enforcement an unprecedented level of access to the movement, whereabouts and location of targeted individuals.

Current law already allows cellphone providers to disclose a user’s location information voluntarily either when the user in question has previously consented to such data being shared with law enforcement or when law enforcement clearly defines to a phone provider that the emergency conditions described in the bill are present. However the bill’s broad language creates a new default where a person’s Fourth Amendment right to privacy is deemed less important than a perceived “emergency”—not as determined by a judge, but instead as determined by police at their own discretion.

Some law-enforcement professionals believe they need this power to do their jobs. But in an age in which law enforcement has so frequently abused their existing investigatory powers, we may be 100 percent certain that this new power, unchecked by judicial process, will be abused. For this reason, Congress must actively defend the Fourth Amendment’s key limiting principle— an independent judicial determination of whether a demand for information (including personal location) is consistent with constitutional principles.

Finally, we note that even the chief advocates for this change in the law admit that it would not have prevented the tragic abduction and death of Kelsey Smith.

Our Fourth Amendment right to privacy is a sacred, uniquely American right crafted by our Founding Fathers that deserves our renewed commitment in the digital age. R Street encourages all members to weigh this importance before rushing to pass H.R. 4889.

Sincerely,

R Street Institute

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

Turnabout is still foul play in politically motivated subpoena fight

May 20, 2016, 11:39 AM

House Republicans’ recently announced effort to probe the activities of environmental groups and foundations like the Rockefeller Family Fund and Union of Concerned Scientists is wrong. And it’s wrong for almost exactly the same reasons that many left-wing groups were wrong to encourage a government attack on groups like the Competitive Enterprise Institute.

Peaceful political activity and speech should never be considered illegal, much less evidence of a criminal conspiracy. A “show us your papers” subpoena of the sort that left-wing groups got state attorneys general to issue to conservative groups is no less offensive simply because it comes from people who espouse a conservative philosophy and support free markets.

There are, to be sure, important differences between the subpoenas from the House Republicans and those issued by Democratic attorneys general. In particular, the House Republicans effort does, in part, target the conduct of government officials. These requests are legitimate—as such requests almost always are.

But attacks on non-profit advocacy groups are a different story altogether. The fact that many of the groups now being attacked by House Republicans encouraged more-or-less identical attacks on right-of-center groups isn’t an excuse either. Two wrongs don’t make a right and government attacks on political speech are never, ever right. Period.

This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

Reforming Fannie & Freddie: What can Congress do now?

May 20, 2016, 9:11 AM
05/26/2016 - 12:00 pm - 1:30 pm
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  • The 21st Amendment continues to choke the drinks trade

    May 20, 2016, 9:06 AM

    Tennessee recently passed a law limiting any company from owning more than two liquor-store licenses. Why? Well, current holders of liquor licenses don’t want out-of-state grocery chains to enter the market and, gasp, sell more brands of liquor at lower prices.

    Would that this were an egregious exception, but such consumer-unfriendly policies are the norm. Consider some examples from around our great nation:

    • In Ohio, the only liquor that gets sold are brands approved by the government. If you are a distiller, you need to ask the state to allow your hooch to cross Ohio’s borders, and you need to ask that the state liquor authority purchase your product and stock it in the state-run stores. If the bureaucrats don’t think consumers want your booze, well, you’re out of luck. Ohio, it should be noted, is but one of the 17 control states.
    • The Texas Legislature has banned corporations from obtaining liquor licenses. Why? Well, as in Tennessee, the concern is that out-of-state grocers will outcompete current retailers. Texas, hypocritically, nonetheless permits in-state liquor chain stores to form by permitting family members to pool their liquor licenses.
    • Four states allow consumers to purchase wines made out of state directly only if their home state has a “reciprocal agreement” with the state where the winery is located.

    One could go on. Plainly, all these policies have nothing to do with public safety or well-being. Such protectionist measures are designed to enrich entrenched interests.

    The 21st Amendment is the well-spring for all this bad regulation. It has imposed huge costs and hassles and consumers and fostered all sorts of corruption.

    Done properly, the 1933 amendment should have struck down the 18th Amendment (Prohibition) and left it at that. But no. The amendment also decreed:

    The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited.

    At first glance, this looks like federalism. It isn’t. This is an invitation to mischief that has allowed states to erect all sorts of rules that inhibit the commercial drinks trade.

    This provision also is offensive to the Constitution on two counts. First, it runs directly contrary to the Commerce Clause (Article 1, Section 8, Clause 3), which assigns the federal government –not states—the authority regulate commerce among the states. There’s a massive corpus of constitutional law that greatly curtails the authority of states to interfere in commerce. A state –say, Ohio – cannot protect its domestic manufacturers by forbidding out-of-state manufacturers from selling their gewgaws and widgets in Ohio.

    Second, the Constitution is wholly silent on the specifics of trade, leaving the regulation of specific goods and services to Congress to decide on a case-by-case basis. Quick civics quiz: what two types of commercial trade does the Constitution explicitly limit? Guns and drugs? Nope. Illicit drugs and prostitution? No. The correct answer is: the slave trade and the alcohol trade. How’s that for a moral equivalence?

    When the Supreme Court took up the matter of state policies inhibiting out-of-state alcohol shipments to consumers, it split five to four. The 2005 Granholm case curbed some of the most egregious state policies, but the justices could not wish away the 21st Amendment. The text is the text.

    Ideally, we would wipe the 21st Amendment’s offending provision from Constitution. This would remove any ambiguity about the extent of the Commerce Clause. Amending any part of our national charter is a heavy lift, but that does not mean it is not worth doing.

    The internet is making it tougher for states to maintain indefensible liquor traffic. Sites like InternetWines.com and others have ways to ship drinks licitly. Consumer expectations have risen, and states are going to have a hard time telling the public, “No you can’t have that beverage. Because.” Over time, more of these bad policies to will crumble, so long as voters keep telling state legislatures that we want better.

    This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

    Elizabeth Warren’s next crusade

    May 19, 2016, 2:36 PM

    From New Republic

    Second, Warren endorses the idea of making benefits portable—an idea endorsed byNick Hanauer and David Rolf on the left and Ian Adams of the R Street Institute on the right. The Affordable Care Act does some of this work already; a freelancer can take that individual insurance coverage with them regardless of their job. Warren called on Thursday for “enhancing portability” in the ACA, a nudge toward putting employer-sponsored health care on the exchanges.

    Time for Congress to vote in the new Puerto Rico bill

    May 19, 2016, 1:53 PM

    A revised bill to address the intertwined debt, fiscal and economic crises of Puerto Rico has just been introduced in the U.S. House. H.R. 5278 proposes “to establish an Oversight Board, to assist the Government of Puerto Rico…in managing its public finances.”

    This “assistance” (read, “supervision”) is needed intensely. If all goes well, the House Natural Resources Committee will report the bill out promptly and it will proceed to enactment.

    As is well-known, the government of Puerto Rico is broke and defaulting on its debt. At $118 billion, by the committee’s reckoning (which rightly includes unfunded government pensions), that debt is six times the total debt and unfunded pensions of the City of Detroit as it entered bankruptcy. This is a truly big insolvency, which reflects long years of constant fiscal deficits filled in by excess borrowing. Moreover, as the committee points out, Puerto Rico’s “state-run economy is hopelessly inefficient.”

    There are three fundamental tasks involved in the complex and massive problems, and the bill addresses all three. These are:

    1. To establish an emergency financial control board to determine the extent of the insolvency, develop fiscal and operational reforms and put the government of Puerto Rico on a sound financial basis. The bill uses the more politic title of “Oversight Board,” but the tasks are the same. They will not be easy and are sure to be contentious, but are necessary.
    1. To restructure the unpayable debt and settle how the inevitable losses to creditors are shared among the parties. The bill gives the Oversight Board the authority, if necessary, to put forth a plan of debt reorganization and the legal framework to reach settlement.
    1. To move Puerto Rico toward economic success – that, is toward a market economy and away from its failed government-centric economy – and thus to give it the potential for future growth. These reforms will not be easy, either, but the bill sets out a process to start the required evolution.

    The discussion of the necessary steps has been long and full. Now it’s time for Congress to vote in the new bill.

    This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

    This crowd believes it can run your life

    May 19, 2016, 10:24 AM

    There’s only one time I recall California officials significantly reducing regulations on anything. That was in 2012, when legislators voted to let physician assistants, midwives, nurses and plumbers provide “routine” abortions. I’m joking about the plumbers, but abortion clinics — and perhaps craft breweries — are the only areas where legislators favor taking a step back out of our lives, even minimally.

    There’s virtually no area of our lives where California legislators won’t insert themselves and tell us — usually in the most excruciating detail — how we must behave. If we don’t do as instructed, the state government has a plethora of enforcement agents at the ready.

    You’d think a group so capable of managing society would be a model for probity, I write with a chuckle. Yet over the past few years, the state Capitol has been awash in scandal. Some are garden-variety, but others would be unbelievable if they were in a work of fiction. The “best” one involves ex-Sen. Leland Yee, one of the Capitol’s most ardent champions of gun control, who is now serving a five-year prison term after pleading guilty to a corruption charge. He was accused, among other things, of being involved in a plot to traffic in arms.

    The San Francisco Democrat was running for secretary of state when he was caught up “in charges alongside some of the city’s most notorious characters, notable among them Chinatown gangster Raymond ‘Shrimp Boy’ Chow,” wrote the Washington Post. “It was one thing for the public to learn that Chow, a known convict, may have become embroiled in more objectionable schemes. But it was quite another to hear that Yee, a respected public figure… was being accused through the same undercover FBI investigation.”

    Yes, it was quite a thing. And it wasn’t the only thing going on in the state Senate. Sen. Rod Wright was found guilty of perjury and seven other felonies related to his place of residence. Unlike with U.S. congressional districts, California legislative seats must be held by people who actually live in the district. Prosecutors said the Los Angeles-area Democrat didn’t really live in down-market Inglewood, but in tony Baldwin Hills. The 62-year-old lawmaker received a 90-day sentence and was banned from public office for life.

    This hardly amounts to an arms-trafficking scheme. But legislators should know the rules about their “domicile.” A number of legislators were also open to questions about where they actually live, which made the legislative response embarrassingly self-serving.

    Wright was one of the Senate’s most-popular members, so the leadership portrayed the charges against him as a great affront to justice. It was nice to see then-Senate Majority Leader Darrell Steinberg, D-Sacramento, find something that sparked concern about overly oppressive government. (Steinberg now is running for Sacramento mayor. Its current mayor, Kevin Johnson, isn’t seeking re-election following sexual-related allegations.)

    Also that year, Sen. Ron Calderon, D-Montebello, “surrendered to authorities after being indicted on bribery charges,” as the San Jose Mercury News put it. Calderon pleaded not guilty in a case that awaits trial. Steinberg assured the Mercury News the three men’s alleged actions were aberrations. The Senate voted 28-1 to suspend all three men from the Senate.

    The problem, however, was they were suspended with pay. Steinberg refused to hold a vote on whether to expel the three senators. Unlike a suspension, expulsion would be permanent. Legislators said it undermined due process to expel members until their cases were complete. Given the time it takes for criminal cases to wind through the appeals process, this means these legislators could potentially hang on until term limits forced them out.

    The one “no” vote was Sen. Joel Anderson, R-El Cajon. The San Diego-area lawmaker complained the suspended legislators’ constituents would have no representation in the meantime. It’s a fair point. Instead of stepping up ethics training, Anderson said the Senate should start by removing all members convicted of felonies. He mysteriously found himself removed from a plum committee — a coincidence, according to leadership.

    Steinberg also introduced a face-saving statewide initiative that presumably would help the Legislature deal with future bad behavior. Proposition 50, which will appear on the June primary ballot, would assure that when similar instances occur, the Legislature can suspend members and force them to forfeit their pay. Such a suspension would require a two-thirds vote.

    It is the “weirdest measure on the ballot” given there’s no one spending any money supporting or opposing it, according to CALmatters. It has a no-brainer populist appeal, which earned it some editorial backing. “What the option of docking pay does is allow lawmakers to remove an element of public outrage when corruption is alleged,” opined the Mercury News. “Lawmakers should have the authority to suspend without pay.”

    Unfortunately, though, the measure reminds the public about why we should always look carefully at any of this Legislature’s ethics reforms. Anderson believes nettlesome political foes are more likely to be targeted by the new power, rather than legislators facing legal problems. “The people didn’t put this on the ballot, the Legislature did,” he said. “The Legislature doesn’t have a great record of putting things on the ballot that will hurt them. … Now, (the leadership) can take people like me and suspend (us.) … It’s given them the ability to steal my pay.”

    That may seem unduly cynical, but consider what current Senate Majority Leader Kevin De Leon, D-Los Angeles, did this month. Following the above-mentioned scandals and a separate one involving a lobbyist, the Senate instituted a blackout period for fundraising during budget negotiation. De Leon just eliminated that rule, given that it is putting one of his favored senators at a political disadvantage this election season. That senator faces a challenge from a current member of the Assembly, where the blackout rule is not in force.

    That’s par for the course. Only the naïve would expect anything different. Meanwhile, other scandals fester. Democratic Assemblyman Roger Hernandez of West Covina, now running for Congress, faces domestic-violence allegations as part of a divorce. He denies the allegations. Even Gov. Jerry Brown was embroiled in a scandal, after the Associated Press reported he “directed state oil and gas regulators to research, map and report back on any mining and oil drilling potential” at his family ranch. In response, the department laughably claimed that service would be available to any Californian.

    It’s all the usual shenanigans in Sacramento (and every other capitol, too). I’ve read enough Menckento expect elected officials to behave this way. But I can’t understand why the public is so willing to let these folks try to run our lives, too.

    Google to France: We can’t pick this Bonaparte

    May 19, 2016, 10:16 AM

    Today’s announcement from Google that the company will appeal a French agency’s order to abide by France’s version of the so-called “right to be forgotten” all over the world doesn’t just represent Google’s principled commitment to support the rule of law. It also signals to the world served by Google’s search and other products that the company supports the rights of ordinary users to read lawful content and know lawful facts.

    What’s the “right to be forgotten”? Sometimes called “the right to delisting,” it’s a right articulated by the European Court of Justice in a 2014 case called Google Spain SL, Google Inc. v Agencia Española de Protección de Datos, Mario Costeja González (we can call it “the Costeja decision” for short). In that case, the European court found a Spanish attorney had the right to demand that Google remove links to a newspaper account of a government-forced sale of his property to pay debts. His argument was not that the newspaper story was false; instead, Costeja’s complaint was that search results including that newspaper story, “appear to be inadequate, irrelevant or no longer relevant or excessive in the light of the time that had elapsed.”

    In effect, the decision created an obligation for Google and other search engines to suppress access to factually accurate newspaper stories, at least within the European Union. That obligation also has been codified in the updated General Data Protection Directive passed by the European Parliament last month.

    Despite disagreeing with the Costeja decision, Google has since 2014 taken steps to bring its Europe-facing services into compliance with the “right to be forgotten,” as it’s being applied in Europe. The company developed a straightforward method for complainants seeking “delisting” of webpages, and it has taken pains to respond to those demands thoughtfully, rather than reflexively, by evaluating whether a demand is consistent with European law. As a first step, Google complied with requests for its services with EU Country Code Top Level Domains (e.g., google.fr, but not google.com). This year, it has done even more, as Google General Counsel Kent Walker describes in an op-ed printed today in the French newspaper Le Monde:

    Following feedback from European regulators, we recently expanded our approach, restricting access to delisted links on all Google Search services viewed from the country of the person making the request.  (We also remove the link from results on other EU country domains.) That means that if we detect you’re in France, and you search for someone who had a link delisted under the right to be forgotten, you won’t see that link anywhere on Google Search – regardless of which domain you use.  Anyone outside the EU will continue see the link appear on non-European domains in response to the same search query.

    (The original French version of Walker’s op-ed can be found here; an English version is available here.)

    This means that if you’re in Paris or Berlin and using Google.com to search, you won’t see websites that have been delisted by Google under French law, as interpreted by CNIL.

    Unsurprisingly, however, the French privacy regulator, CNIL Commission Nationale de l’Informatique_et_des_Libertés, has decided that Google’s painstaking efforts to comply with lawful invocations of the “right to be forgotten” are not enough. As I wrote last year in Slate, CNIL’s ambitions are global. The French agency wants to compel “delisting” of content a French resident has demanded be removed in any country in which that content might appear.

    The Costeja decision itself did not find that an EU citizen could demand delisting of true material everywhere it might lawfully appear in the world. And it wouldn’t make sense to do so. The internet may connect us globally, but we still have nation-states. It’s generally (although not quite universally) understood that there are still limits on what the government of any nation can demand from the rest of the world.

    Google’s argument in its appeal focuses partly on the precise language of the Costeja decision—that only a listing whose “processing” is “inextricably linked” to an EU member state (by being associated with advertising and/or search results displayed within the member state) can be subject to a demand like CNIL’s. It also relies on a generally accepted interpretation of France’s data-protection law; if the search results and the display results take place outside of France, the French data-protection law should not apply.

    I’m grateful that Google is committed to challenging CNIL’s global (one is tempted to say “imperialistic” assertion of authority). If France’s privacy regulator has its way, this French regulatory agency will have unilateral authority to limit content that is lawful in the Philippines or Chile or the United States from being seen in those countries. As Google’s Walker puts it:

    The CNIL’s latest order, however, requires us to go even further, applying the CNIL’s interpretation of French law to every version of Google Search globally. This would mean removing links to content – which may be perfectly legal locally – from Australia (google.com.au) to Zambia (google.co.zm) and everywhere in between, including google.com.

    Walker goes on to make the same argument that every thoughtful observer has made with regard to any country’s assertion of extraterritorial authority to remove content:

    But if French law applies globally, how long will it be until other countries – perhaps less open and democratic – start demanding that their laws regulating information likewise have global reach?  This order could lead to a global race to the bottom, harming access to information that is perfectly lawful to view in one’s own country. For example, this could prevent French citizens from seeing content that is perfectly legal in France. This is not just a hypothetical concern. We have received demands from governments to remove content globally on various grounds — and we have resisted, even if that has sometimes led to the blocking of our services.

    This is the argument every democratically oriented citizen and government must make. Even as we are increasingly globally interconnected through the internet, we still live in a world of nation-states that reasonably expect to have their national sovereignty respected and protected. As a nation, we may choose, through our governments and representatives, to agree to be bound by international treaties. But the rest of the world has not yet agreed to the expansive, grandiose assertions of authority from France’s officially officious privacy regulator.

    This work is licensed under a Creative Commons Attribution-NoDerivs 3.0 Unported License.

    Industry shouldn’t rely on government for innovation

    May 19, 2016, 8:13 AM

    From Houston Chronicle

    “Other groups, including Friends of the Earth, called on Moniz to suspend all clean-coal projects. The Department of Energy would do better to concentrate on funding basic research, said Catrina Rorke, director of energy policy at the R Street Institute, a conservative think tank.

    “This administration has prioritized an elusive breakthrough in developing carbon capture and sequestration over their commitment to the taxpayer,” she said.”

    The mythical ‘savings’ of the 2014 farm bill

    May 19, 2016, 8:00 AM

    Shortly after the Bipartisan Budget Act of 2015 was unveiled, text of the legislation, which promised to raise the nation’s debt limit and set spending levels through September 2017, prompted mayday sirens from both the House and Senate Agriculture committees. Much to the committees’ chagrin, the bill’s negotiators targeted changes in the U.S. Department of Agriculture’s Standard Reinsurance Agreement for federally supported crop insurance as a potential source of budget savings.

    The SRA sets the target rate-of-return for insurance companies that participate in the federal crop insurance program, as well as payments to the companies for administrative and operating costs, such as agent commissions. It previously was exempt from being touched by congressional appropriators thanks to a provision in the 2014 farm bill. The Bipartisan Budget Act ordered USDA’s Risk Management Agency to renegotiate the agreement with participating insurers and find $3 billion in savings, an order members with agricultural constituencies found far too tall.

    The House and Senate Agriculture committees almost immediately issued a harshly worded joint release. According to Senate Agriculture Committee Chairman Pat Roberts, R-Kan.: “Farmers and ranchers have done more than their fair share to reduce government spending.” Ranking Member Debbie Stabenow, D-Mich., further chimed in:

    I oppose any efforts to cut or reopen Farm Bill programs… The Farm Bill made meaningful reforms to help reduce the deficit. Any attempts to reopen any part of the Farm Bill to more cuts would be a major set-back for rural America and our efforts to create jobs.

    In the words of House Agriculture Committee Ranking Member Collin Peterson, D-Minn.: “We made major cuts when we wrote the Farm Bill. It is not appropriate to cut agriculture again. The Farm Bill should not be raided. I oppose any cuts.” For House Agriculture Committee Chairman Mike Conaway, R-Texas, the prognosis was even direr: “Make no mistake, this is not about saving money. It is about eliminating Federal Crop Insurance.”

    Unfortunately, these overblown warnings were too powerful for Congress to resist; the directive to negotiate more taxpayer-friendly reinsurance deals with private crop insurers was reversed in the highway bill passed in November 2015. But in fact, the arguments made by crop-insurance-subsidy proponents are misleading. Giving in to the committee leaders’ line of thinking sets a dangerous precedent, not just for those dedicated to ensuring farm programs are accountable to taxpayers, but also for those dedicated to transparency and accountable spending in all programs.

    Beyond the question of whether the federal government should support any large, established industry, or the more specific question of whether that industry could withstand having its taxpayer-supported rate of return lowered from 14.5 percent to 8.9 percent, it’s just simply not true that “farmers and ranchers have done more than their fair share to reduce government spending,” or that “it is not appropriate to cut agriculture again” (emphasis added).

    Part of the disagreement stems from discrepancies between the spending that was projected at the time the 2014 farm bill was passed and the actual spending by the USDA over the past two years. While it’s true that lawmakers passed legislation that was projected to achieve savings, spending todate has far exceeded those projections, erasing much of the promised progress. If Congress wants to ensure the nation’s agriculture programs don’t become unwieldy, ever-growing budget items, understanding the current state of these programs is an important first step.

    The robust public-health case for tobacco harm reduction

    May 18, 2016, 5:49 PM

    Last year, Margarete Kulik and Stanton Glantz proclaimed in Tobacco Control that there is no public-health basis for telling smokers about smokeless tobacco and e-cigarettes as safer cigarette alternatives, because the smoking population in the U.S. was “softening,” i.e., becoming more likely to quit.

    Kulik and Glantz based their conclusion, in part, on an analysis of public survey data from the Tobacco Use Supplements of the Current Population Survey.  They had information on the percentage of smokers (prevalence); the percentage of smokers who made a quit attempt in the past 12 months; the proportion of former smokers among ever smokers (also called the quit ratio); and daily cigarette consumption (cigarettes per day, or CPD) for each state and for several survey years from 1992 to 2011. Using linear regression, they found that a 1 percent decline in smoking prevalence is associated with a 0.6 percent increase in quit attempts, a 1.1 percent increase in the quit ratio, and a reduction in consumption of 0.3 cigarettes per day.

    The analysis was seriously flawed, as the authors failed to consider other factors that may significantly affect smoking. For example, Kulik and Glantz should have considered data on the percentage of smokers who faced workplace or home smoking bans – information that was available in the survey datasets. The effect of state cigarette excise taxes should have been weighed. Additional factors, such as differences in smoking norms and anti-smoking sentiments in the various states, are commonly analyzed through the use of a standard fixed effects variable. They did none of this.

    My research group has recreated the Kulik and Glantz analysis and taken into account the missing variables. Our results have now been published in the journal Addiction. We found that the “results are not robust…The inclusion of state fixed effects and state-level policies led to a large drop in the coefficients…and became statistically non-significant…the omitted state-level characteristics are most likely responsible for…[Kulik and Glantz]’s results.”

    We also note:

    One further point needs to be made. [Kulik and Glantz] claim that their study bears on the question of whether smoke-free tobacco products have a contribution to make to tobacco control.  They claim that much of the argument for smokeless tobacco and e-cigarettes is dependent on the assumption that the smoking population is hardening.  This is not the case. The argument for these considerably safer products e-cigarettes is simply that they may be short-term aids to cessation or permanent substitutes for tobacco cigarettes.  In a population such as that in the US, that argument is relevant as long as there are substantial numbers of smokers who will use them.

    For the 39 million smokers in the United States, there is no public-health basis to withhold either safer cigarette substitutes or the potentially life-saving facts about such products.

    Growth is green

    May 17, 2016, 1:42 PM

    Global 2000, a report published by the Carter administration in 1980, offered a bleak forecast for the human race. It predicted “the world in 2000 will be more crowded, more polluted, less stable ecologically, and more vulnerable to disruption than the world we live in now … Barring revolutionary advances in technology, life for most people on earth will be more precarious in 2000 than it is now—unless the nations of the world act decisively to alter current trends.”

    The report spawned neo-Malthusian policy prescriptions to restrict consumption, shrink the birth rate, and bring mankind into balance with the natural world. YetGlobal 2000’s dire projections proved woefully incorrect. Even with rising global levels of population and economic activity, our relationship with the environment has only improved. Consider that U.S. energy needs have grown dramatically since 1970, but our production of dangerous pollutants—including particulate matter, carbon monoxide, nitrogen oxides, sulfur dioxide, and lead—has fallen. A growing population, after all, also yields more of the most important resource at our disposal: human ingenuity.

    This has not put a stop to Malthusian speculation. There’s no shortage of voices still suggesting that economic growth necessarily harms the natural environment, that it’s time to start considering an economy centered around economic or ecological justice, or that we need policies to adjust to a zero-growth future. Doomsayers find support for their pessimism in the current locus of ecological concern: a changing climate. Global agreements to reduce emissions start with the assumption that every nation, even the poorest, must untether its economic future from fossil fuels.

    These theories are as threatening as they are ill-founded: structuring policies around a low- or zero-growth future will stop global development in its tracks and trap a growing segment of the world’s population in poverty. But rejecting doom-and-gloom forecasts of impending environmental and economic catastrophe is not tantamount to denying the problem of global climate change. The best solution to that problem is in fact more growth and global development—much of which can be fostered with energy sources that do not add to emissions.

    The globe is indeed warming, and we are largely responsible. Of the 16 warmest years on record, 15 occurred in the last century. Atmospheric concentrations of greenhouse gases are increasing thanks to human activity; current concentrations of carbon dioxide, methane, and nitrous oxide are higher than at any time since before humans evolved. Models, though notoriously imperfect, suggest these trends will continue.

    With enough warming, we may reach a tipping point beyond which irreversible changes are possible. Abrupt shifts in ocean circulation patterns could upend the marine ecosystem. Hydrologic alterations could cause persistent droughts and food and water shortages. The worst consequences of climate change, however unlikely, could create conditions in which the environment would be transformed rapidly and unpredictably.

    But climate change, even with these high-risk scenarios, is not the most pressing threat facing global humanity. The near- and medium-term risks of climate change largely just make existing problems worse. Nearly one-fifth of the developing world’s population is undernourished, 13 percent lack access to clean water, and 32.5 percent have inadequate sanitation. World Health Organization data suggest that 8.4 million deaths each year are attributable to the avoidable hazards of malaria, malnutrition, unsafe water, and indoor and outdoor air pollution.

    Poverty is a better predictor for mortality risks than climate change. Higher carbon dioxide emissions have even been associated with fewer deaths from extreme weather as nations develop. In the advanced world, our lives are undoubtedly more improved by the economic development that fossil fuels enable than harmed by the threat of climate change.

    For some, the conclusion to be drawn from this is that government-led efforts to reduce greenhouse-gas emissions should be abandoned. Under each scenario modeled by the United Nations’ Intergovernmental Panel on Climate Change, people in the future, even in the developing world, will be so much better off with unbridled economic development that it will counteract any negative effects of a warmer and more unpredictable climate.

    Fossil fuels are certainly terrific at their job: they’re widely distributed, cheap to produce and refine, easily scaled, and yield power on demand. Technologies to harness these fuels are well-understood, widely available, inexpensive, safe, efficient, and reliable. Coal, oil, and natural gas prices have been dropping, making them more affordable than ever. Yet they do not answer all of the developing world’s needs.

    Some 2.8 billion people still don’t have access to safe cooking facilities, and 1.3 billion don’t have access to electricity. At a minimum, households need energy for lighting, cooking, heating and cooling, and communications. Insufficient access makes everything more difficult: food spoils, lamps and stoves demand costlier or foraged fuel, and people are exposed to indoor air pollution, unsanitary conditions, poor nutrition, and avoidable illnesses.

    Building sufficient traditional-energy infrastructure to satisfy demand will be a slow process, even under optimistic scenarios, and such infrastructure isn’t necessarily suited to the most immediate needs. Reliance on fossil fuels is a risky proposition for much of the world: many communities with traditional electricity connections grapple with brownouts, rationing, and bills that far exceed a household’s ability to pay. Fuels remain expensive, and supply chains to make them readily available are often underdeveloped.

    Energy access is more important than access to any one particular fuel. In this respect, the needs of the developing world and the West’s priority on limiting emissions coincide, up to a point: access can be reliably provided in some places by other forms of energy.

    Telecommunications history offers a telling analogy. Landline phones were a democratizing innovation, enabling instantaneous person-to-person communication. But the network infrastructure was limiting. Until the 1980s, having access to a telephone meant being in a service territory with a phone utility and having a wire to your home.

    Mobile technology is wholly different. Enabled by distributed infrastructure, entire communities can gain access to phone communication at once. Untethering communications from the old infrastructure has expanded access in places previously untouched by such services. In 1990, there was no access to mobile technology in sub-Saharan Africa; by 2014, 78 percent of people held mobile-phone service.

    A fossil-based energy future is dependent on the same type of network infrastructure that quickly grew outdated in the telecom industry. That’s why many developing communities are choosing other ways forward. Solar-energy systems and battery-enabled LED technologies don’t require any new infrastructure. Passive solar heating can generate enough hot water for washing. In some cases, greater efficiency is the answer. Development organizations are working to improve cook stoves so they release less indoor air pollution. Safe perishable food storage can be managed with changes that don’t require access to electricity or refrigeration.

    There are similar opportunities in commercial activity and community services. Mechanical wind and hydroelectric technologies offer opportunities for irrigation, agriculture, and small industry. Remote health centers have turned to solar-power systems with battery storage for much of the last decade. With promising price curves, as well as capacity and efficiency improvements, these off-the-grid solutions may work well to power distant communities and encourage more rapid economic development.

    Trends favor these investments. Prices for photovoltaic solar, wind, and battery-stored power are coming down quickly, reflecting advances in manufacturing, materials, and installation. If the experience of smaller lithium-ion batteries is any example, prices for large-format battery technology may drop by an order of magnitude in the next decade. Human ingenuity is making renewable energy cheaper to harvest, mobilize, and store for use when needed.

    International aid should respond appropriately. In 2013, 97 percent of the $13.1 billion in capital investments for energy access in the developing world went to the electricity sector. Yet established World Bank policy permits financing for coal-power generation only where there are no feasible alternatives, and the U.S. Overseas Private Investment Corp. uses a greenhouse-gas emissions cap to weigh its investments. The West has adopted incoherent policies that respond poorly to the developing world’s needs, putting too much or too little emphasis on fossil fuels. And the resurrection of Malthusian tendencies at the highest echelons of the international policy community is dangerous.

    But we do not face a choice between improving the lives of billions now and an apocalyptic climate future. Rather, we have an opportunity simultaneously to improve the lives of billions and to make our future world safer. That starts with accepting a few things. There is no morally correct level of atmospheric carbon dioxide. Global prosperity is a necessary precondition for dealing with climate risk. Human ingenuity is an incredible and limitless resource. And our new target as a global community should be to alleviate the threats of climate change by eradicating poverty and building energy access.

    For now, that means access to any source of energy. Distributed renewables present great opportunities for rapid availability in areas presently without reliable sources. And to be sure, strengthening fossil-energy infrastructure and supply chains will open access to the most reliable forms of energy in the long run. Policies that distort choices between the two are counter-productive. If we shift away from a focus on aggressive climate-mitigation efforts, we can refocus international cooperation on reducing health and environmental risks, building wealth, and developing innovative solutions. In that wealthier, safer, more adaptable future, reducing carbon emissions will not just be easier, it will be business as usual.