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Texas’ Voter ID Law and Section 2 Litigation September 21, 2013

Posted by Afflatus in History, Politics, Uncategorized.
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The story of Texas’ Voter ID law is fascinating. Ever since 1975, Texas was required, under the Voting Rights Act (VRA), to seek approval from the federal government to any changes the state legislature might want to make to its election laws. The purpose of this law was an important one: to ensure that jurisdictions with a history of voting discrimination provide all of its citizens with equal access to the voting booths. Yet in June 2013, the Supreme Court struck down Section 4(b) of the VRA, which stipulated the formula for determining which jurisdictions would be subject to federal “pre-clearance” of proposed voting changes under Section 5 of the VRA. By determining that the Section 4 formula was unconstitutional, Shelby rendered the Section 5 “pre-clearance” regime inapplicable and unenforceable (until Congress updates the formula). So now, Texas may change its voting laws at will.

In 2011, the Texas legislature passed SB 14. It is one of the strictest photo ID laws in the nation, requiring voters to present photo identification from a very limited list before being allowed to vote. The law allows Texans to vote with a Texas concealed handgun license, but not with an ID from a public university or a tribal identification card. (See the Brennan Center’s complaint in its challenge to the law, especially paragraphs 41-45, for how the law will discriminate against minority voters.) In August 2012, in the pre-clearance proceedings, the U.S. District Court in DC rejected the law, finding that it would almost certainly “lead to a retrogression in the position of racial minorities with respect to their effective exercise of the electoral franchise.” The appeals process in this lawsuit was pending when the Supreme Court this summer struck down portions of the VRA, removing Texas from the pre-clearance requirement. Two days after the Supreme Court ruled on the VRA, it instructed the District Court to dismiss the pending litigation against Texas, allowing the State to do as it pleases.

Equal Justice Under Law?

Voting equality groups like the Brennan Center launched lobbying campaigns, and Congressmembers began imploring their colleagues to update the formula as the Supreme Court suggested Congress should do.

In addition to those advocacy efforts, lawyers at the Department of Justice, the NAACP, MALDEF, and elsewhere, started litigating to enforce the equal opportunity to vote. Though the Supreme Court had eliminated Section 5 pre-clearance as a tool, there was still Section 2.

Section 2 of the Voting Rights Act of 1965 prohibits voting practices or procedures that discriminate on the basis of race, color, or certain minority-language memberships. Section 2 is a creative alternative to Section 5 for enforcing equal access to voting booths, but it is a poor substitute. First, it is an ex post approach rather than ex ante — the voting discrimination must have already occurred. Second, it is far more costly and litigious. Third, the burden of proof is flipped: rather than States being required to prove, under pre-clearance, that a proposed law is nondiscriminatory, plaintiffs are required to prove that the law is discriminatory. These are serious drawbacks, and, while I acknowledge that there were problems with pre-clearance regime, I’m of the opinion that unconscionable voting discrimination is already occurring across America as a result of the change in the regulatory structure and enforcement due to the Supreme Court’s VRA decision.

As stated before, the burden of proof to show that Section 2 has been violated is on the plaintiff, and the threshold is high. Plaintiffs must show that, in the context of the “totality of the circumstance of the local electoral process,” the standard, practice, or procedure being challenged had the result of denying a racial or language minority an equal opportunity to participate in the political process. This is a statutory standard deriving from the 1982 reauthorization of the Voting Rights Act.

The Senate Judiciary Committee in 1982 issued a report in an attempt to provide guidance to courts when interpreting whether, in the totality of the circumstances, an election law has violated Section 2 of the Voting Rights Act. The factors the Senate suggests are:

  1. the history of official voting-related discrimination in the state or political subdivision;
  2. the extent to which voting in the elections of the state or political subdivision is racially polarized;
  3. the extent to which the state of political subdivision has used voting practices or procedures that tend to enhance the opportunity for discrimination against the minority group, such as unusually large election districts, majority-vote requirements, and prohibitions against bullet voting;
  4. the exclusion of members of the minority group from candidate slating processes;
  5. the extent to which minority group members bear the effects of discrimination in areas such as education, employment, and health, which hinder their ability to participate effectively in the political process;
  6. the use of overt or subtle racial appeals in political campaigns; and
  7. the extent to which members of the minority group have been elected to public office in the jurisdiction.

The Judiciary Committee pointed out that this list is neither exclusive nor comprehensive. However, plaintiffs need not prove every factor, or even a majority of them. It’s obvious that there is a tremendous amount of room for courts to interpret this how they please.

Lawsuits raising claims under Section 2 of the Voting Rights Act are few and far between — depending on your definition, there are around 35. In the wake of the Supreme Court decision, the leading Section 2 lawsuits are a group of three related cases challenging the same Texas Voter ID law that the District Court in DC reviewed within the Section 5 procedure, one of which was brought by the U.S. Department of Justice. Read more about the latest of these three cases, NAACP v. Steen, here.

The complaint in NAACP v. Steen is complex because what it seeks to prove — that a voter ID law will disproportionally impact, and thus discriminate unconstitutionally against minorities — is a very difficult proposition to prove in court. It’s also interesting because of the back story of Taxas’ voter ID law in District Court, and because of the Supreme Court’s recent decision on the VRA. As a law student learning about argumentation, it’s interesting to see the strategy adopted by the complaint, and which of the Senate’s factors listed above the complaint chooses to stress.

If you’re familiar with Voter ID laws generally, jumping straight to Paragraph 45 might be a good idea. Paragraph 50, listing the historical voting discrimination perpetrated by the State of Texas, is absolutely appalling.

Ultimately, the complaint alleges that the law has both a discriminatory result and a discriminatory purpose. It also alleges that the law violates the Fourteenth and Fifteenth Amendments of the United States Constitution. It was filed 4 days ago in U.S. District Court for the Southern District of Texas. I’m very curious to watch this unfold!

Speaker Boehner’s Latest Gimmick December 11, 2011

Posted by Afflatus in Politics.
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Yet again the United States Congress is approaching crucial deadlines before which it must act in order to prevent devastating consequences from resulting. After averting a government shutdown by mere minutes in April, avoiding a default on its Treasury bonds in August, the federal government is once again on the edge of an abyss. This time the issues at hand are whether to re-extend a host of provisions that expire at the end of the year, and how to pay them. The expiring payroll tax cut, the expiring “doc-fix” which temporarily appropriates money to pay Medicare doctors, and the expiring unemployment insurance provisions are the main provisions at stake. Cue the political brinksmanship, backroom deal-making, and late-night Congressional sessions! Far from the best way to form policy, comprehensive, last-minute grand bargains appear to be the only way American “leaders” do it nowadays.

Goldman-Sachs economists estimate that letting the current payroll tax cut expire at the end of this month would reduce economic growth by as much as two-thirds of a percentage point in early 2012. The most recent data from the Bureau of Economic Analysis shows that in the third quarter of 2011 the economy grew at a rate of 2.0 percent. Letting unemployment insurance expire would remove money from the economy causing a further hit to America’s economic output and additional hardship for millions of American families.

After much wrangling in the Senate, Speaker Boehner on Friday unveiled H.R. 3630, comprehensive legislation that would extend the payroll tax cut at its current rate, extend (some) unemployment insurance, and extend the “doc-fix” for two years. This is all good and fine. The problem is how Speaker Boehner proposes to pay for the measures, which will cost roughly $166.8 billion in fiscal year 2012 according to the Congressional Budget Office. H.R. 3630 would accumulate $38.4 billion from Medicare spending cuts; $36.7 billion from increased federal employee retirement contributions; $35.7 billion from increased Fannie Mae and Freddie Mac mortgage insurance rates; $33.4 billion from other health care offsets, such as cuts in the Affordable Care Act’s prevention fund; $16.5 billion from FCC spectrum auction; and an additional $36.6 billion from many small and miscellaneous cuts, many of which are problematic.

There a whole host of major problems with Speaker Boehner’s proposal. In addition to how the bill would weaken unemployment insurance, the bill contains all sorts of harmful policy-riders. The most brazen provision is one that requires the President to approve within 60 days the permit for the Keystone XL pipeline. If the President does not approve the permit, H.R. 3630 would automatically trigger its approval on day 60. As a result of widespread protests against the Keystone XL pipeline, President Obama in early November delayed a decision on its permit until 2013. The President has said he veto any bill that contained a Keystone XL pipeline policy-rider such as this one. What’s more, the bill would delay new pollution standards for industrial boilers, extending a deadline for five years for companies to comply. The Environmental Protection Agency has completed the rule-making process on these standards and says the rules would cut pollution of mercury and soot. In October, House Republicans passed a bill that would have repealed these same EPA boiler standards, and once again, President Obama threatened to veto it if it reached his desk.

While the two policy-riders I just mentioned are perhaps the most flagrant, there are other deplorable provisions in the bill. One would restrict the Federal Communications Commission’s ability to impose net-neutrality conditions on wireless companies that purchase spectrum leases at auction. The bill also seeks to eliminate certain tax credits that illegal immigrants may be currently taking advantage of. While this bill is supposed to be about 3 important expiring tax provisions, House Republicans are attempting to use this opportunity to make significant policy changes to totally unrelated programs. One provision even makes substantial reforms to the National Flood Insurance Program.

Speaker Boehner is lining up the Republican Conference behind the measure, and it will almost surely pass the House before Thursday. However, there are so many provisions that cross red-lines for Democrats from all persuasions that it is almost guaranteed to fail in the Senate (assuming Majority Leader Reid even brings it up for a vote). President Obama has reiterated his veto, and called the legislation what it is: classic political maneuvering. Speaker Boehner used this exact same tactic during the April budget negotiations and the summer’s debt ceiling talks. In all three cases he has crafted legislation that his party can support, and that no Democrat will, and quickly passes it through his body of Congress, daring the President and Senate Democrats to reject it while they struggle to find a bi-partisan solution.

Speaker Boehner will pass this bill, which he has called “the Middle Class Tax Relief & Job Creation Act” in an attempt to gain bargaining power over Democrats. He knows this wont be the final solution to the expiring tax provisions, but by passing it through the House he gains leverage and helps guide the negotiations towards his preferred policy-outcomes. Will he get what he wants? For America’s sake, I sure hope not.

I-9 Audits and Immigration Policy Failure July 16, 2011

Posted by Afflatus in Economics, immigration, Politics.
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Last week in the New York Times, there was an article about how the Obama Administration’s immigration policies are affecting small businesses around the country. It explains that while the Bush Administration focused on headline-making raids that resulted in arrests of immigrant workers, the Obama Administration has gone after employers with Immigration and Customs Enforcement’s I-9 audits.” These audits consist of requiring employers to verify the eligibility to work in the United States of all its employees. The theory behind the policy is that employers who hire undocumented workers create the demand that produces the influx of illegal immigrants.

While I certainly applaud the Obama Administration for halting the inhumane practices of raids and deportation of immigrant workers, I don’t think I-9 auditing is a good approach to solving our country’s immigration problem. The article details how burdensome and detrimental to production these requirements are on small businesses. Businesses are forced to fire good employees they otherwise would not fire. Business are also required to complete onerous paperwork.  Many even hire lawyers, further increasing their costs. One business owner said he had reduced his 2011 sales goals by 15% after the disruption caused by ICE’s I-9 audit.

Now, I understand that this “onerous paperwork” is attempting to ensure compliance with the law. It is illegal to hire workers that are ineligible to work in the United States, and the Justice Department should enforce the law. But the program is a abject failure. It’s goal – reducing employer demand for illegal workers – is not being achieved, and long-term progress towards the achievement of this goal seems far-fetched. It’s quite clear from the article that the illegal workers whom ICE requires businesses to fire have found other willing employers to give them jobs. So what is really being achieved besides burdensome regulations that hamper economic growth? Demand for undocumented workers is only reduced marginally, while economic growth is reduced substantially.

To me the I-9 audit program seems like a political tool employed by the Obama Administration to provide itself with cover for its support of immigrant-friendly policies such as the DREAM act. Whether this suspicion is true or not, the I-9 audits are yet another example of how our failure to address immigration reform in a comprehensive and smart way weakens America’s economy.

Debt Ceiling Debate – Politics and Policies July 11, 2011

Posted by Afflatus in Economics, Politics.
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A number of people have engaged me in a discussion about the ongoing debt ceiling negotiations with a great sense of anxiety. While a failure to raise the debt ceiling would be catastrophic for the United States (and the world), it is not yet time to start worrying. In fact, it would be strange if the negotiating parties, which effectively consist of the House Republican leadership and President Obama, reach a compromise deal before the final hour. For the next 10-14 days, the two sides will continue jockeying – through media outlets and face-to-face – in order to improve their respective negotiating positions.

Treasury Secretary Tim Geithner has said August 2 is the final day after which the Treasury can no longer use accounting tricks to avoid defaulting on some of its debt. Yesterday, the President said a deal needs to be agreed upon in 10 days in order to allow time for legislation to pass both houses of Congress to raise the debt limit in time. However, now is not the time to start worrying. In theory, one should not expect either side to compromise until it believes its negotiating position is at its peak strength relative to the other side. Unless one side comes to the humble conclusion that its negotiating position will only weaken in the future, do not expect to see a deal until the final hour. Despite this, I’m optimistic about a compromise deal occurring. Both sides consist of patriots who understand the devastating consequences America would suffer if they failed to raise the debt ceiling. Moreover, neither side wants to suffer the political blame for ruining the country’s financial dominance.

Many of my fellow Democrats have expressed exasperation that the debate has largely been happening on Republican terms. With the exception of the recent and marginal success Democrats have had in pushing the policy idea of closing tax loopholes on jets and yachts, the negotiations have largely taken place on Republican terms. This is especially true if you take a longer view and consider the Fiscal Year 2011 budget debate which culminated in early April. The reason for this right-leaning negotiation is that the Republican House majority, largely unified and highly disciplined, can credibly threaten that they will actually shut the government down (in April) or let the Treasury default on its maturing debt (now). In neither case could the President, or Democrats in Congress, credibly threaten to do the same. Why can the the Republican Party do this? Because it has been content to shirk the responsibilities of governing.

Since January the Republicans have proposed literally only one policy idea to help the fledgling economy: cut spending. Not only does this proposal fail on its own terms (they refuse to cut Defense spending, or subsidies for big businesses), but it is also economically fallacious. Current Republican arguments upend the foundation of modern macroeconomics, Keynesianism, which argues that counter-cyclical spending is required for a healthy economy. Put simply, this means that in times of economic boom (1990’s for example), government spending should be curtailed. In times of economic bust (2007-2009) government spending should be increased. This is based on the fact that during a recession three components of GDP (investment, consumer spending, and net exports) will almost certainly decrease. It follows that the fourth and final component of GDP should be increased. That’s called stimulus. It’s such a mainstream idea that even George W. Bush supported it.

This morning Moody’s Analytics details how government spending (stimulus and unemployment compensation) was crucial throughout the recession to keep the economy on its feet. Now, as it dries up, Moody’s is warning of a weakening of the economy. The June jobs report was poor – only 18,000 jobs were added to the economy. What’s striking is that the public sector lost 39,000 jobs! These are the direct result of federal, state and local budget cuts. Without these budget cuts forced upon government, the jobs situation would not look nearly as bad. Republicans insist on cutting government spending, and then when budget cuts lead to bad jobs reports, they bemoan the lack of jobs. Not only is this economically nonsensical, it is morally wrong. While refusing that rich people pay their fair share of the burden, they insist on cuts which disproportionally affect the poor. This is regressive and wrong. And it’s not the type of society in which I want to live.

So it is not yet time to worry about a the lack of a debt ceiling compromise. However, outrage over Republican economic ideology is long overdue.

Libyan “Hostilities” Revisited June 20, 2011

Posted by Afflatus in Politics, World Affairs.
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It’s already time for me to revisit the debate over Libyan “hostilities.” I’m not happy with my post last week, and a lot has happened since then. The House of Representatives is likely to consider two measures this week (probably on Thursday) relating to the US Libyan operation: an amendment to the FY2012 DOD appropriations bill offered by Rep. Kucinich to defund the entire operation, and some sort of Republican alternative, the exact language of which is still being worked out by GOP leadership. There are really three questions at stake here, which I feel like my last post did not delineate clearly:

1: Are American military operations in Libya justified?

2: Is the President legally bound to receive authorization from Congress in order to conduct these operations?

3: Regardless of the answer to question 2, should the President seek authorization from Congress?

In my last post, I only really answered question 1, and I did so indirectly. I fully support US military operations in Libyan and believe they are justified. The United States and its allies prevented a massacre, upholding the R2P norm, at little cost. While the US took the lead at first, we did so in conjunction with a broad coalition that included Arab and African countries. Qaddafi’s regime was causing insecurity in North Africa and the world, and there was a serious threat to the stability of Arab Spring hopefuls Tunisia and Egypt, which Libya borders. The alternative, withdrawing our support for the NATO mission, would undermine whatever levels of trust we have with our allies. While the mission of the NATO military operation is not regime change, that is the stated political goal. Establishing a new regime in Libya (one of the most tribal countries in Africa) will certainly be messy, but I agree with the administration’s decision to make regime change the explicit political goal. This is a very low-cost way for the US to achieve a desired long-term goal.

Regarding question 2, there is really no clear answer. The controversy over this particular question intensified over the weekend when it was reported that President Obama overruled the legal advice of his Attorney General and the Office of Legal Counsel at the Justice Department. These two offices are charged with providing the Oval Office legal counsel, and to overrule them both is a major statement. Admittedly, the President knows a thing or two about the constitution, and he does have the final say. The statute in question, the War Powers Act, is extremely ambiguous, and the judicial branch has not, and seemingly will not, issue a formal ruling. Thus, Congress could clarify the law, or it could use its tools to make Obama suffer for this politically. It will definitely do the latter, and it may attempt to do the former. While Obama may suffer political consequences, he will not suffer legal ones.

Ideally the answer to question 3 is yes. The more debate and oversight that takes place in Congress, the more democratic America becomes. However, things are not that simple when politics are involved. My former professor, and respected Arab world commenter, Marc Lynch posits that the administration did not seek Congressional authorization early on in its Libyan operation because it correctly believed there would be significant, unwanted riders attached to the legislation like repealing health care reform, reinstating “Don’t Ask, Don’t Tell”, or more budget cuts. I think he is right. The truth is, nobody knows what would have happened had the administration tried to receive authorization from Congress last week before the 90 day threshold expired. The administration judged the wiser choice was to claim it does not need Congressional authorization because the War Powers Act does not apply to its current Libyan operations.

Marc Lynch also wishes that the administration would seek Congressional authorization and make a “full-throated case for the Libya intervention– why it was launched, what it accomplished, where it fits into the broader unfolding Arab transformation, and how its success will advance American interests.” Now that is has made it official policy that the administration does not need Congress’ approval, this will not happen. I am satisfied that the 30 page memo to Congress fulfills this explanation on the part of the administration. While it may not be the unabashed defense of the Libyan “hostilities” that Lynch desires, it persuasively answers the questions of “why it was launched, what it accomplished, where it fits into the broader unfolding Arab transformation, and how its success will advance American interests.”

RSA Animate: Crisis of Capitalism? June 18, 2011

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In this RSA Animate series entitled “Crisis of Capitalism,” sociologist David Harvey lays out the standard analyses of what went wrong in the 2007-2009 Financial Crisis, and then then offers a Marxist interpretation of his own. The categories he lays out at the beginning  are instructive, and he presents some important facts about wage stagnation, wealth accumulation at the top, and the dominance of capital over labor. The video is thought-provoking and worth-watching, however his ultimate conclusions are unpersuasive.

Harvey argues that capitalism “never solves its crisis problems,” instead “it moves them around geographically.” He asserts that this is exactly what has happened: the US is recovering from its financial crisis, but Greece is experiencing a sovereign debt crisis. While both of these things are happening, Harvey makes no attempt to provide a causal link between the US recovery and the crisis in Greece. Without strong contrary evidence, I’m inclined to believe that the US recovery has little to do with the Greek sovereign debt crisis. Greece’s fiscal problems and economic stagnation date back decades, and why would US economic production cause Greece to be unable to repay maturing debt? Harvey doesn’t say.

Finally, Harvey concludes on a revolutionary note arguing that “any sensible person right now would join an anti-capitalist organization.” This is an overstatement. There is clearly room to solve the problems that led to the financial crisis within a capitalist system. In America, Dodd-Frank was a start. We still need more consumer protection safeguards and regulatory reform in the financial sector. I do like how Harvey concludes by suggesting that we need a broader discussion to solve these problems. A more inclusive dialogue will help bring about an economic system that is more responsible, just, and humane. However, it will be a capitalist system, and it should be.

Libyan Hostilities? June 16, 2011

Posted by Afflatus in Politics, World Affairs.
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Do U.S. operations in Libya amount to “hostilities” as defined by the War Powers Act? That is the big question among national security legal experts right now. The divide between the legislative and executive branches of America’s federal government over the War Powers Act of 1973 has always been stark. And the judicial branch (which is supposed to mediate disputes such as this) has distinctly avoided weighing in on the matter. The law was passed in 1973 by a supermajority in both houses of Congress, overriding President Nixon’s veto. The law basically says that the President is only authorized to initiate the armed forces into “hostilities” if one of three things has occurred: 1) a declaration of war, (2) specific statutory authorization, or (3) a national emergency created by attack upon the United States, its territories or possessions, or its armed forces. Most President’s, detesting the law’s constraints on their power, have openly declared the law to be unconstitutional. They cite Article II, Section 2 of the constitution which simply states that the President is Commander and Chief of the armed forces.

Congress has been clamoring for an explanation from the administration of its Libyan operations. On Wednesday they got it, with the Obama Administration arguing that nothing it was doing in Libya constituted “hostilities.” The lack of hostilities makes the War Powers Act totally inapplicable. The administration sent a 30-page memo to Congress, 14 pages of which are unclassified. I find almost every argument the administration makes in the memo compelling. Most of them are not new; the memo repeats the same arguments the administration has made since March, and they are well-founded.

The memo starts with background, and quickly refutes one of the most frequent objections, “well if we go into Libya, why not Bahrain, Syria, or Cote D’Ivoire?” The administration’s response is that Libya was unique: “In this particular country – Libya – at this particular moment, we were faced with the prospect of violence on a horrific scale. We had a unique ability to stop that violence: an international mandate for action, a broad coalition prepared to join us, the support of Arab countries, and a plea for help from the Libyan people themselves. We also had the ability to stop Qaddafi’s forces in their tracks without putting American troops on the ground.” One or more of these conditions was not satisfied in the other countries.

Since coming into office, President Obama has projected a coherent vision of engagement with the world based on strengthening the international rule of law. The Libyan intervention falls right in line with this tenet of his. The international principle of the “responsibility to protect” was invoked and reinforced. The intervention had a wide mandate from the United Nations. Qadhafi’s brutal violence against his own population has been catalogued by a United Nations Commission of Inquiry and has resulted in a request for arrest warrants by the Prosecutor of the International Criminal Court for crimes against humanity. Standing idly by would have undermined the United States’ credibility as well as that of the international community’s role in preventing mass atrocities from occurring.

The administration’s memo also explains that America’s role is truly quite limited. The administration makes a convincing argument that the U.S. is not engaged in “hostilities” as the War Powers Act intends. Since March 31, when the U.S. handed off the primary command and control duties to NATO, America’s role has been limited to “electronic warfare assistance; refueling; strategic lift capability, personnel recovery and search and rescue, intelligence, surveillance, and reconnaissance support; and an alert strike package.” Since March 31, three-quarters of the over 10,000 sorties flown in Libya have now been by non-U.S. coalition partners, a share that has increased over time. All 20 ships enforcing the arms embargo are European or Canadian. The United States provides nearly 70 percent of the coalition’s intelligence capabilities and a majority of its refueling assets, enabling coalition aircraft to stay in the air longer and undertake more strikes. The US also lends its unique air strike capabilities – unmanned Predator UAVs – to the mission. So we perform intelligence, resupply non-US aircraft, and fly drones. That ain’t a whole lot. The Pentagon reports that this will cost $1.1 billion by September, but it has vowed not to seek off-budget appropriations (as was repeatedly necessary for Afghanistan and Iraq).

My one problem with the administration’s unclassified policy memo is the stated time line of operations. At the June 8 meeting of NATO Defense Ministers, NATO reaffirmed the April 14th statement of Foreign Ministers that operations would continue:

“until all attacks and threats against civilians and civilian populated areas have stopped… until the regime has pulled back all its forces — including its snipers and its mercenaries — away from civilian centers and back to their bases. And until there is a credible and verifiable ceasefire, paving the way for a genuine political transition and respecting the legitimate aspirations of the people of Libya.”

Although we’re not doing much in Libya’s airspace, and American lives are not at risk, this is a virtually open-ended mandate. Qadhafi has shown his resolve, he is not pulling back until the rebels and coalition forces push him back. Due to the highly tribalized and fragmented society that exists in Libya, a ceasefire that will “pave the way for a genuine political transition” will take years. $1 billion is not much money to the Pentagon or the federal government, but if you extend that out for a couple years and consider other pressing, domestic spending priorities, the cost becomes a significant problem.

Are America’s Libyan operations illegal? No. Will the lawsuit filed by Rep. Kucinich et al. fail? Yes. Is it a problem that national security law at the highest levels is ambiguous? Absolutely. My personal opinion is that foreign policy decision-making should not be democratic. But at the same time there must be real transparency and accountability for the decisions which the President and his national security advisers make.

The E. Coli Outbreak and Internationalism June 12, 2011

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The outbreak of a rare, toxic strand of E. Coli in Europe is fascinating because it is a perfect demonstration of our interconnected world and because it has serious implications for multilateralism. The first article I read on the issue was this New York Times piece on May 29, 2011. While the source is northern Germany, the article states that there were cases identified in Britain, Denmark, the Netherlands, and Sweden because citizens from those countries had visited northern Germany recently. As a result, Austria and the Czech Republic halted imports of Germany vegetables. But the network of interconnection doesn’t stop there; according to the Czechs, shipments of the suspect vegetables also went to Hungary and Luxembourg. But there’s still more global-mania! The Germans blamed two Spanish farms in Málaga and Almería. Spain denied those accusations and continued to export vegetables from those farms while commencing an analysis of their soil, water, and produce.

Since May 29, Russia has banned all imports from Europe, US citizens have been hospitalized, European farmers are going broke, and the source of the outbreak has been confirmed as bean sprouts in northern Germany. To date, 31 people have died from the virus and the number of reported cases has risen to 2,988, with over 750 of those affected by a serious complication that can cause kidney failure. When people talk about global issues that span national borders, this is what they are talking about. This outbreak makes a perfect case for stronger and more effective international institutions. Nations must share information, combine resources, and work together to meet challenges which span national boundaries.

The irony of course is that Europe already has the most integrated and sophisticated regional institutions in the world. And how have those institutions fared during this crisis? Most obviously, EU institutions failed to prevent the outbreak from spreading, admittedly a quite difficult task. More frequent inspections, and faster, more robust data sharing among European regulators would help mitigate the diffusion of the next public health threat. The most significant reactionary measure taken so far has been an aid package to compensate farmers suffering from the dramatic drop in demand for their products. On Tuesday, June 7, EU Agricultural Commisioner, Dacian Ciolos (a Romanian nominated by the Spanish European Comission President, José Manuel Barros), made a proposal whereby affected farmers would receive 30% of the market price of unsold crops, up to a total of €150m ($215m). This was immediately rejected as woefully insufficient by Spain, France and Italy. The following day, Ciolos unveiled a more generous scheme which would see all affected producers get 50% of market price, costing €210m ($301m) until the end of June. In addition, the estimated one-third of farmers who are members of national producer organizations will get another 20%, funded 50/50 by the EU and the organizations of which they are members. This plan is expected to be ratified at a meeting of European Union officials next Tuesday. So now taxpayers in Greece, Finland, and Germany will effectively be compensating farmers in Spain, France, and Italy!

Stating that the world is interconnected has almost become hackneyed, but seeing the effects of globalization and EU institutions at work is still fascinating.

Georgia Immigration on My Mind May 18, 2011

Posted by Afflatus in Economics, immigration, Politics.
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For the superstitious among us, Friday the 13th has always been a dark day. But this past Friday the 13th was a particularly bad day for all Americans, but especially for Georgians. On Friday May 13th, Georgia Governor Nathan Deal signed into law H.B. 87, the Illegal Immigration Reform and Enforcement Act of 2011. The law, which was modeled on similar legislation in Arizona and Utah, gives police the authority to verify the immigration status of suspected criminal offenders. This power will surely lead to widespread racial profiling. The law also requires many private employers, and all public employers, to check the immigration status of newly hired workers on a federal database called E-Verify, a highly burdensome regulation. Beyond that, the law is full of ambiguous language, making it likely law enforcement officers will abuse their newfound power with impunity. Just to ensure the law was sufficiently damaging, Georgia Republicans threw in some unfunded mandates with which county governments and state agencies must comply.

Perhaps one of the most outrageous provisions of the law is the creation of a new crime, “aggravated identity fraud,” for which one can be charged for using a fake ID in order to obtain employment. If found in violation one would be sentenced to state prison for up to 15 years and face up to a $250,000 fine. For comparison, the punishment in Georgia for having sex with a 16 year old is only five years jail time. With the stroke of a pen Georgia has become extremely hostile to undocumented workers, illegal immigrants, and, likely, Hispanic-looking people in general. This new law will cause serious economic and cultural damage to the state of Georgia. Moreover, it represents a growing hostility to immigrants in the United States. This growing trend in America is self-defeating and will hasten American decline.

The new law is almost certain to result in the moral injustice of racial profiling. This is not only wrong, but also contrary to American values, which is one of our country’s greatest strengths. Additionally, the law will significantly hamper the economic growth of several important industries in Georgia. Tourism will suffer greatly, as it has in Arizona where 40 conventions were canceled amid economic boycotts costing the state an estimated $141 million. In only its first seven months, Arizona’s immigration law cost the state a whopping 2,761 jobs and $9.4 million in tax revenue. Georgia’s leading industry is agriculture, which generates $65 billion annually toward the State’s economy and employs one out of every seven residents. Many of these workers are undocumented immigrants, without whom the agriculture industry would come to a grinding halt. This law will undoubtedly hurt Georgia’s economy at a time when it is struggling to revive itself.

The conventional wisdom is that undocumented workers are a huge drain on the state’s economic resources, paying no taxes and consuming vast amounts of government resources. In fact, the opposite is true. According to the Georgia Budget and Policy Institute, in 2006 undocumented immigrants in Georgia contributed between $215.6 million and $252.5 million in aggregated sales, income, and property tax to state and local government coffers. In addition, research by the Immigration Policy Center indicates that Georgia would lose more than $21.3 billion in economic activity if all undocumented immigrants were removed from the state and that immigrant owned businesses had sales and receipts of more than $12.2 billion and employed more than 74000 people in 2002. These are their contributions to the state; what about their costs? Undocumented immigrants are banned from using almost all government-provided social programs with two notable exceptions: K-12 public education and emergency health care. While it’s hard to have sufficient data on the exact net effects, it’s clear the conventional wisdom is wrong: undocumented immigrants contribute greatly to economic activity and government revenue in positive ways.

Moreover, one of America’s unique strengths, especially compared to other developed countries, is its open borders. Perhaps the biggest problem facing Western European countries, Russia, and Japan is their aging and contracting populations. An older and smaller workforce is a recipe for economic stagnation. The US Census Bureau projects that the American population will grow 49% over the next four decades, a fact largely due to immigration. The US has always been a country of immigrants and it will continue to be one. Immigrants will help America remain the most dynamic and powerful economy in the world. This pluralism is essential, and it, coupled with America’s unique creativity in innovation, will counteract other forces of American decline.

America must strive to remain an attractive place to live and work, and a place where all are welcomed equally. However, by targeting immigrants and Hispanics Georgia’s new law does just the opposite. The law is unequal as written and will be even more unjust in application. America’s trend of unchecked hostility towards immigrants, as Georgia’s new law so clearly embodies, will severely weaken America’s economic strength. Moreover, the trend, if it continues, will undermine America’s claim to be a place of equality and opportunity for all people. America’s greatest strength is its ideals. Let’s not abandon them.

US Debt and Reason for Optimism April 20, 2011

Posted by Afflatus in Economics, Politics, World Affairs.
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On Monday morning, April 18, the ratings agency Standard & Poor lowered its outlook on American debt from “stable” to “negative.” The change in S&P’s outlook on America’s credit worthiness signals that there is a one in three chance S&P will downgrade America’s credit rating (currently AAA) by 2013. The pundits, news anchors, and politicians went almost haywire over the announcement. The markets? They hardly budged. The Economist reports: “The market reaction has been about as benign as one could hope for; relative to the Friday close, equities are higher, bond yields are lower, and the dollar is basically flat. Markets shrugged.”

In a fantastic piece on the reality of America’s debt crisis, “American Government Debt: What, US Worry?”, The Economist’s Free Exchange blog provides logic and level-headedness throughout. The article clearly shows that America has a debt problem, but not an absurdly bad one. “America’s ratio of gross government debt to GDP currently stands at about 99%. That’s not an absurdly high level for a rich country at the present time. It’s about 24% above Germany’s ratio and 20% above Britain’s. It’s 82% of Italy’s debt ratio, 66% of Greece’s, and less than half of Japan’s.”

The problem is that America’s debt-to-GDP ratio is projected to continue growing for the foreseeable future, whereas many of those large European countries are expected to have falling debt-to-GDP ratios by 2013.

However, there are some truly optimistic signs of hope when one seriously looks at America’s debt situation. America’s projected economic growth is strong; by 2016 the IMF believes America will grow at twice the pace of the German economy. America has better demographics than countries in Europe or Japan. America’s population is generally younger and immigration flows are higher (Immigration is good for long-term growth!) Additionally, America issues the world’s dominant reserve currency and the most plentiful safe asset. This means the dollar will remain strong and America will be able to continue borrowing at low interest rates.

Additionally, the article points out that there are clear routes forward to solve its fiscal situation, both on the taxing side and the spending side. The Economist supports low taxes but still recommends comprehensive tax reform which would marginally raise taxes on all individuals while broadening the tax base substantially. This is common sense and it is what President Obama has proposed.

Further on the optimistic front: “it was scarcely a decade ago that America was running actual surpluses and not long before that that bitterly opposed politicians were cutting deals that made those surpluses possible.”

Without question, America requires action on fiscal matters. But it’s delusive for two reasons to suggest that America must make imminent budget cuts to discretionary spending programs to solve its long-term debt problem. One: the problem is not an imminent crisis. Two: cuts to discretionary programs mathematically cannot solve the debt problem.

In fact, the cuts made in the FY2011 budget compromise made last week will hurt the economy. Unfortunately, politicians on both sides of the aisle grandstand as if deficit reduction has begun in order to capitalize on the country’s budget-cutting mood. Meanwhile, objective economists on both sides of the aisle state that the economy will suffer as a result of these cuts. Consumer spending will decrease, and some jobs will be destroyed or not created.

To solve America’s long-term debt problem, maturity and cool heads must prevail in Congress. Bipartisanship has always taken place in the past, and it will take place in the future. While America’s political system is at times maddening, it was designed to produce compromise. During the course of America’s history, congressional leaders and presidents have generally risen to the challenge when crises were in fact imminent. If America’s debt problem becomes a crisis, it can be resolved. Until then, America should focus on rebuilding its economy, and structuring it to compete successfully in the future.