Reason Magazine - Topics > Congress

Economic Populists for Lower Corporate Taxes

jsullum@reason.com (Jacob Sullum) — Tue, 07 Oct 2008 19:13:00 EDT

The puzzling political analysis of New York Times national correspondent Jackie Calmes continues with a "Congressional Memo" contending that "on the economy" the Republican Party "is increasingly populist." That explains resistance to the Wall Street bailout by Republicans in the House, Calmes says, because "populists do not favor bailouts of Wall Street." For Calmes, the alleged increase in Republican economic populism is of a piece with an increase in "social conservatism," including "opposition to abortion, gay rights and liberalized immigration policies," that has alienated "voters from families that have been Republican for generations." These socially conservative, economically populist Republicans are "less affluent and less educated—and more suspicious of big business—than mainstream Republicans of days past."

But what about all the House Republicans who said they opposed the bailout because it constitutes excessive government intervention in the economy? Calmes quotes Rep. Jeb Hensarling (R-Texas), for example, who condemned the Treasury Department's plan as "the slippery slope to socialism." Is socialism the opposite of economic populism? Calmes concedes that "nearly all of the Republican opponents insisted they were upholding the party's principles and its 'brand' by opposing big-government intervention in what should be free markets." Yet somehow she divines that what really motivated them was hostility toward big business.

"To get the [presidential] nomination," Calmes writes, John McCain "made accommodations to the conservatives dominant in the party by his rightward turns on tax cuts and other issues." Do economic populists push a lower corporate tax rate?

Calmes understands that Republican critics of the bailout see themselves as upholding Ronald Reagan's legacy, but she's having none of it:

Republican figures from the Reagan years say these conservatives misread their idol's record of bipartisan compromises. Amid the current financial crisis, several recalled that after the 1987 market crash, Mr. Reagan and the Democratic leaders in Congress negotiated a budget compromise of spending cuts and revenue-raisers to signal to markets that the government was serious about reducing the deficits.
"Ronald Reagan would not be comfortable as a House Republican today. Ronald Reagan was the ultimate pragmatist and fiscal conservative," said Kenneth M. Duberstein, a White House chief of staff to Mr. Reagan.

So Ronald Reagan's fiscal conservatism (overrated, but that's another story) means he would have supported the Treasury Department's plan to spend $700 billion in taxpayers' money on the worst investments it can find?

I realize Calmes' main aim is to shake her head at what she calls the House Republicans' "rigidly ideological stance at a time of economic crisis." But she could at least get the ideology right.

Christmas in October

mike.flynn@reason.org (Michael Flynn) — Thu, 02 Oct 2008 17:00:00 EDT

The Senate is overly fond of referring to itself as the “world’s greatest deliberative body.” Barely 48 hours after the House rejected the Treasury’s bailout plan, the august body took a previously passed House bill mandating that insurance companies cover mental health benefits, added in the core $700 billion bailout, laced in money for rural school districts and disaster relief, expanded FDIC deposit insurance coverage, and topped it off with over $150 billion in old and new tax breaks for businesses, individuals in high-income states, individuals living in states without an income tax, and various interests such as wooden-arrow makers and film production crews. GOP Leader Mitch McConnell, almost choking back tears after the Chamber passed the 451-page monster, said it was the Senate “at its finest.” The Age of Pericles this ain’t.

I’ll leave it to others to comment on this mother-of-all-Christmas tree bills. The bulk of the Senate legislation is essentially the same as that rejected by the House. It authorizes the Treasury Department to use $700 billion to buy up bad loans. Certain banks get cleaner balance sheets immediately and the feds supposedly will minimize the risk to taxpayers by selling the bad loans when the market “stabilizes” and the prices of the loans have improved.

To paraphrase Mencken, this solution is neat, plausible, and wrong. The first failing is something that is only now being openly stated: Treasury expects to pay some unknown premium above any current market price for mortgage-backed securities (MBS). We don’t know what the premium will be nor how it will be determined. Well, in a sense we do. It will mostly be determined by politics, not economics. This is the foundational flaw in the Treasury plan.

Once signed into law, Treasury would begin a process to determine the assets it will buy and the manner it will set a price. Like everything in government, this is a moment that is lobby-able. Expect swarms of financial services lobbyists, investor groups, housing advocates, and others to try to game the system for their individual clients or members. The further away from economics these decisions are made, the more risk there is for taxpayers. The higher the premium over any current market price, the longer the government will have to hold the assets.

The risk here is particularly high given the complicated and rather opaque nature of the financial instruments involved. Few on Wall Street, let alone in Washington, understand these products. I have strong reservations about whether federal bureaucrats have the capacity to appropriately price and manage these instruments. Apparently, I’m not the only one with these doubts. The bailout would authorize Treasury to bypass normal contracting rules and hire outside private firms to handle the purchases and manage the toxic assets. That these private firms have ongoing relationships with the banks selling the bad assets creates one hell of a conflict of interest.

Some commentators have drawn parallels to the Savings & Loan bailout in the 1980s, when the government established the Resolution Trust Corporation to dispose of the assets of failed thrifts. They mean the comparison favorably. But, that is of a piece different than the proposal at hand. The RTC took possession of a host of assets as thrifts went bankrupt. They received whatever assets the failed thrift possessed. Under this plan, however, federal bureaucrats and their outside contractors would decide which assets to buy. They would ostensibly go from institution to institution, review the books, and say, “We’ll buy this and that; you hang on to those.” The government will be actively investing taxpayer funds in individual securities and then managing the portfolio until such time as it decides to sell.

One doesn’t have to be paranoid to envision the political dynamics that will shape these decisions. Will Fidelity out of Boston have a special edge because Rep. Barney Frank (D-Mass.) chairs the Financial Services Committee? Will Nutmeg State-based hedge funds have an advantage because of their close ties to “Friend of Angelo” Sen. Christopher Dodd (D-Conn.)? That we don’t even fully know who will be making these decisions, as a new administration takes office in just four months, warrants no further comment.

Neither do we need to say much about the moral hazard raised by taking bad debt off the books of private companies. While the government, unfortunately, has in the past taken steps to shore up individual companies or even certain sectors, I don’t think it has ever before proposed to take such an active role in the markets. Secretary Paulson is proposing our very own sovereign wealth fund. Once government has dipped its toe into this water, it is hard to see it leaving the pool, especially if the government is able to earn a “profit” when it sells the assets in a rebounding market.

It is hard to imagine the government resisting calls to take the “toxic” pension costs off of automakers’ books. Or some of the “toxic’ legacy costs of the big airlines. Let’s remember, this is one of those rare cases where the “victims,” the bankers and investment bankers, are the very people who made the mistakes. It is possible that, absent government intervention, we can get through this upheaval with no one else actually getting hurt. This isn’t like the former Enron employees who lost their life savings through no fault of their own. This is financial institutions failing because of the very specific mistakes they made.

Probably the most troubling is the proposal to give the government equity stakes in the companies participating in the bailout. It’s bad enough for the government to purchase these companies’ bad debt. The bailout, however, would make the government an owner in the companies themselves. This is unchartered territory, and raises lots of troubling questions. Would the government get seats on the board of directors? How would the government dispose of the equity? When? Will there be firewalls to prevent government, or government officials, from using the equity stake to influence the business decisions of the company?

The bailout passed by the Senate also contains provisions to limit executive compensation for participating companies. It is entirely unclear how this would work. The populist appeal is easy to understand, but if the restriction is too draconian, companies may decline to participate. Beyond practicality, however, it is another dangerous precedent. We are perhaps too far removed from the wage-and-price-control days of Nixon to remember how destabilizing they were.

These are the things we know. Certainly, there will be a host of new regulations that will only emerge in the days, weeks, even months after final passage. And, unfortunately, these will likely be with us long after the government has sold off the last of the bad debt. We could be entering an era where the financial services sector evolves into a kind of regulated utility. Not only would this stifle future innovations in finance, it would also probably jeopardize the U.S.’s status as the global leader in capital markets.

It is hard to see a systemic regulatory failing that allowed the current situation to arise. There does seem to have been a comprehensive failure by the ratings agencies to appropriately analyze the MBS, but torts are a better way than new regulations to correct this. Besides, regulations are usually backward looking. Regulators rarely identify problems before they arise. Chiefly they sort out what happened and who’s responsible after the fact.

Remember, wrongdoing at Enron wasn't uncovered by regulators. It was uncovered by the market, as analysts realized that much of the company’s story was fiction. Markets with free flows of information are the best guard against meltdowns. The slightly less free market we are entering will make them more common.

Also, while I have no real reason to question Hank Paulson’s motives in his rampant cheerleading for a bank bailout, I would feel a whole lot better if he weren’t sitting on a few hundred thousand options to buy shares in Goldman Sachs.

This is something like a 50,000 mile wide Rubicon. Once we’ve crossed into this unchartered, constitutionally suspect territory, it is hard to see us ever going back. We will never again have free-flowing, free-wheeling or free capital markets.

Mike Flynn is director of government affairs at the Reason Foundation.

Bailout Bums

dweigel@reason.com (David Weigel) — Thu, 25 Sep 2008 15:00:00 EDT

To understand how Washington, D.C.’s fiscally conservative and libertarian-leaning Republicans are handling Treasury Secretary Henry Paulson's proposed $700 billion bailout of the financial services sector, think of a child who’s just learned that there is no Easter Bunny. Better yet, think of a guy who sunk his portfolio into Lehman Brothers or Bear Sterns and watched everything he was taught to believe about his investments declared moot, wrong, meaningless, at the mercy of the state.

The bailout "does ensure that President Bush will have a legacy,” laughed Fred Smith, the president of the Competitive Enterprise Institute, a staunchly pro-free markets group, on Wednesday. “It’s a legacy that will discredit every economic concept that we have on the right. It will set back the concept of economic liberty by a century.”

Openly or secretly, a lot of Smith’s fellow travelers in the Beltway agree. Three weeks ago in St. Paul, Republicans released a platform that declared flatly, “We do not support government bailouts of private institutions” and that “government interference in the markets exacerbates problems in the marketplace and causes the free market to take longer to correct itself.”

Yet as the panic over Wall Street woes has mounted, those principles got lost, and a critical number of Republicans are expected to support a $700 billion bailout of failing investment banks being pushed by a GOP president and his money man. Although serious problems with government-sponsored enterprises such as Fannie Mae and Freddie Mac have long been evident and despite longstanding anxiety about "too-big-to-fail" market players going belly up, the Republicans were caught flat-footed by recent events.

The experience of the most fiscally conservative members of Congress, the Republican Study Committee (RSC), is instructive. Throughout the Bush years, the RSC has proposed alternative budgets heavy on spending cuts. Now, forced to consider a spending package equal to a million earmarks, it was pushed to the side.

Its members did act fast. On Wednesday, September 17, RSC stalwart Rep. Jeff Flake (R-Ariz.) released a forceful statement: "The federal government's propensity to bail out failing companies in struggling industries ought to be troubling to all taxpayers....Aside from the fiscal impact of spending money that the federal government doesn't have, these bailouts will likely have the opposite of their intended effect." Flake also took aim at the then-rumored bailout of the automobile industry.

On Thursday, the RSC sent a public letter to the White House opposing any Wall Street bailout: “Regardless of the precautions taken, the risk to taxpayers and to the long-term future health of our economy remain just too great to justify.” But on Friday, RSC Chairman Jeb Hensarling (R-Texas) put out a tentative, milquetoast statement on the proposed bailout that decried the idea without ruling it out completely. “Though my mind remains open,” Hensarling said, “at the moment I remain skeptical, fearful, and unconvinced that this is the proper remedy for our nation at this time.”

The next day the draft of Treasury Secretary Henry Paulson’s plan was released, with a Tiffany price tag and enumerated powers such as buying up bonds galore and a two-year ban on any real oversight of Treasury’s activity. Former RSC Chairman Mike Pence (R-Ind.) rejected “the largest corporate bailout in American history.”

But other than that: Crickets. Fiscal conservatives mostly dared not come out swinging against a proposal offered by a White House they had, more often than not, trusted.

This past Monday at 5 p.m., the RSC met to strategize further. Who was opposed to the bailout, full stop? Who had alternatives they could put on the table? According to staff who were at the meeting, the mood was somber, with a majority opposed to the concept of a bailout but without a clear idea of how to challenge it. When the full Republican conference met on Tuesday, there was even less unity. At a Heritage Foundation luncheon, Flake told bloggers that about half of his party’s members opposed a bailout.

While Flake was speaking, a dozen members of the RSC were beginning a press conference in the House to make their suggestions and state their positions. Reporters picked up a pithy one-page memo of RSC proposals, including

—a two-year suspension of the capital gains tax, after which “rates would return to present levels but assets would be indexed permanently for any inflationary gains.”

—full privatization of Freddie Mac and Fannie Me “over a reasonable time period.”

—repeal the Humphrey-Hawkins Full Employment Act, which the RSC fingered for the Fed’s suppression of interest rates to artificially low levels (although the Act expired in 2000).

—a suspension of mark-to-market regulatory rules (assigning value to a financial instrument based on the current market price).

That was it. The rest of the press conference was, if not a circus, a carousel with a lot of mis-matching horse heads. Rep. Kevin Brady (R-Texas) suggested that business tax cuts could attract investors to our shores bring more revenue from “profits left stranded overseas." Rep. Joe Barton (R-Texas), a dogged supporter of more oil drilling, claimed that the policies he favored would, conveniently, pull us out of the crisis. “The oil revenues that we could get from ANWR have been scored by the Congressional Budget Office at around $200 billion,” Barton said. Rep. Michele Bachmann (R-Minn.) excitedly agreed with him. ”If we open up these areas for energy exploration, well, Katy bar the door! We’d see this economy turn around immediately!”

Mike Pence, still the only member at the press conference ruling out any yes vote for a bailout, tried to challenge the premise. “There are those in the public debate,” he said, “who have said that we must act now. The last time I heard that, I was on a used-car lot.”

“I would amend that statement,” added Rep. John Shadegg (R-Ariz.). “The last time I saw the phrase 'act now' it was advertising one of those time-share condo deals that lock you in after a free trial period.”

”Did you try it?” asked a reporter.

”No!” Shadegg laughed. But he didn't line up with Pence against any bailout.

The presentation had no notable impact on the debate in Congress. As the Republicans spoke, a few cameramen snickered audibly. When Bachmann called the bailout “the enslavement of the American people,” the snickering reached its loudest pitch. And on the way out, Pence offered reporters more proposals that would probably come to nothing, such as a suspension of the capital gains tax by executive order. "There are learned legal scholars who think that's within his purview as president," Pence explained.

But enough Republicans are ready to support the bailout to make all of this moot. Rep. John Campbell (R-Calif.), an Ayn Rand fan and potential future head of the RSC, conceded that his party is divided. “People are struggling with it around here like you can’t believe,” he told me on Tuesday. “This proposal is anathema to everything I believe. I’ve voted against million dollar bills, and here’s a $700 billion one. But to do nothing—that really threatens a massive expansion of government.”

How so? Campbell doesn’t shy from comparing it to 1929. “If John Q. Lunchbucket doesn’t understand this stuff, and waits in line for a block to get into his bank, and then is told ‘we don’t have your money,’ he will respond to any proposal to prevent that in the future. Any populist who says ‘I’ll make sure these guys never get your money again’ will have his ear.”

There is an external reason for the division of Republicans right now. They don’t control Congress. The Democrats run both houses and are negotiating with the executive branch. They own the agenda. But it is striking how free-market economics have no place in the current debate. They are not seen as a credible response to a Wall Street crisis, even by the presidential nominee of the Republican Party, who is angrily attacking the "greed of Wall Street." Contra Naomi Klein, an economic shock has sent Republicans skittering away from free-market theories; the last thing the party of small government seems interested in letting markets work. The current political debate, not just between Democrats and Republicans but even among Republicans, is not whether the government should take over mortgage firms, but how effectively it can manage them.

“Nobody trusts Republicans on these situations,” said Fred Smith. “For good reasons.”

David Weigel is an associate editor of reason.

That's Some Fine Oversightin' There, Chairman

rbalko@reason.com (Radley Balko) — Tue, 23 Sep 2008 10:58:00 EDT

Rep. Barney Frank (D-Mass.), chair of the House Banking Committee, on the bailout:

"I think we have to recognize the reality that we don't have a choice now of debating whether this is a good or a bad thing."

Who cares if it might makes us worse off. Just do something, dammit!

Hat tip: Caleb Brown.

Sen. Stuart Smalley?

info@reason.com (Damon W. Root) — Tue, 16 Sep 2008 16:08:00 EDT

At The Nation's Campaign '08 blog, John Nichols reminds us that funnyman Al Franken isn't out of the running for the U.S. Senate just yet. As of last week's Minnesota primary, it's now officially a three-way race between Republican incumbent Norm Coleman, Democratic-Farmer-Labor candidate Franken, and Independence Party hopeful Dean Barkley. For those of you watching Ron Paul's Rally for the Republic two weeks back, Barkley is the fellow that Jesse Ventura nearly forgot to mention in the midst of his 9/11 conspiracy rant. Barkley served as chairman of Ventura's long shot gubernatorial campaign, served as Minnesota senator after Paul Wellstone's death in 2002 (appointed by Gov. Ventura, then replaced by the duly elected Norm Coleman), and worked as campaign manager for Kinky Friedman's independent run for governor of Texas in 2006.

Here's how Nichols breaks it down:

Because of his own high-spending campaign, sly moves to the political center and stumbles by Franken, Coleman had maintained an advantage in the race.

But Barkley, though his campaign is short on funds, has a big name and more than a little good will accumulated over many years of independent political activism. And, this year, Barkley seems to be drawing more from Coleman than Franken.

[...]

If Franken can secure the liberal DFL base, he might just make it to the Senate without a majority—as, it should be noted, Coleman did in 2002.

Whole thing here.

D.C. City Council Might Pre-emptively Surrender on Guns

bdoherty@reason.com (Brian Doherty) — Mon, 15 Sep 2008 10:15:00 EDT

The Washington Post is reporting on a bill that D.C.'s City Council might be voting on as early as tomorrow that would seem to largely pre-empt the goals of both the bill moving through Congress that would liberalize D.C.'s gun laws post-Heller and the "Heller II" lawsuit. Some details:

D.C. officials, coping with a U.S. Supreme Court ruling that threw out the city's handgun ban, have drafted legislation that would do away with several remaining firearms restrictions, including safe-storage requirements and a provision that bars ownership of semiautomatic pistols.
....
Although the move by the city to ease handgun restrictions coincides with the House effort to virtually strip the District of its power to regulate firearms, [Democratic council member Phil] Mendelson said officials are not seeking to placate members of Congress. He said the proposed changes, which he will urge the council to pass Tuesday, result from a careful review of the Supreme Court decision in the weeks since it was issued June 26.
"I think we're addressing the Supreme Court ruling and, coincidentally, addressing Congress's concern," said Mendelson....And by addressing the Supreme Court ruling, he said, "it will pull out the underpinnings of the argument for that legislation."
............
Although the storage requirements would be done away with, a gun owner would be subject to prosecution if a child got hold of a loaded, unlocked firearm. If the child did not hurt anyone, the owner would face a misdemeanor charge punishable by up to six months in jail. If the child injured someone, the owner could be charged with a felony carrying up to five years in prison.

I've been unable to yet read this draft legislation, and am a bit confused by the Post saying both that it would "do away with....provision that bars ownership of semiautomatic pistols" and that it would "ban magazines capable of holding more than 10 rounds" since it was that whole "capable" language that has so far allowed D.C. to claim that pretty much any clip-loaded semi-auto is forbidden, but more should be more public soon.

The Hill on the tangled progress through Congress of the bill to overturn D.C.'s existing gun regulations.

And my forthcoming book, Gun Control on Trial, on the Heller case and its many attendent issues.

The Subsidy State

jsullum@reason.com (Jacob Sullum) — Wed, 03 Sep 2008 07:00:00 EDT

A few years ago, in the wake of Hurricane Katrina, Sen. Tom Coburn of Oklahoma suggested taking money earmarked for a notoriously extravagant "bridge to nowhere" in Alaska and using it for reconstruction work in Louisiana. Sen. Ted Stevens of Alaska, a fellow Republican, angrily declared, "This is the first time I have seen any attempt by any senator to treat my state...differently from any other state."

In a tirade that included threats to behave like "a wounded bull on the floor of the Senate," to "be taken out of here on a stretcher," and to "resign from this body," Stevens' insistence that all he wanted was equal treatment for Alaska may have been the least believable thing he said. During the last four decades no one has done more than Stevens to ensure that Alaska is treated unequally, receiving far more in federal spending than it pays in taxes.

The octogenarian senator's gift for grabbing dollars in the zero-sum game of congressional appropriations helps explain his easy victory in last week's Republican primary, despite his recent indictment on federal charges of hiding corporate gifts. Yet the "track record of delivering results for Alaskans" he brags about is more scandalous than the crimes he denies, exemplifying a pervasive, poisonous parochialism that flouts the Constitution and drains the Treasury.

Federal prosecutors accuse Stevens of violating the Ethics in Government Act by failing to report more than $250,000 in gifts (consisting mostly of renovations to his "chalet" in Girdwood, Alaska) from VECO Corp., a now-defunct oil services and construction company whose CEO has admitted bribing state officials. Stevens' trial is scheduled to begin on September 22 and conclude shortly before the November 4 general election, so Republicans could be stuck with a convicted felon on the ballot.

Although the government says Stevens "could and did use his official position and his office on behalf of VECO," it is not charging him with accepting bribes, apparently because it does not have enough evidence of a quid pro quo. But if Stevens did help VECO with grants or contracts, it was of a piece with the "results" he has delivered for his constituents since he joined the Senate in 1968, and the amount of taxpayer money involved was a drop in the ocean compared to the billions of dollars he has directed Alaska's way.

From 2004 to 2008, Taxpayers for Common Sense reports, Stevens had a hand in 891 Alaska-oriented earmarks worth $3.2 billion. That works out to about $4,800 per Alaskan, 18 times the national average. And earmarks represent just a fraction of federal spending in Alaska, which totaled $9 billion in 2006 alone.

According to the Tax Foundation, Alaska ranked first in federal spending per capita in 18 of the 25 years from 1981 through 2005. In 2005 Alaskans received $1.84 for every dollar they sent to Washington in taxes. Stevens, who was chairman of the Senate Appropriations Committee for a dozen years and until his indictment was the senior Republican on the defense appropriations subcommittee, has played such an important role in this northward redistribution of income that federal spending in Alaska is known as "Stevens money."

Alaska continues to receive these subsidies from the rest of us even though its government, which collects neither sales nor income tax from state residents, is flush with oil revenue and running budget surpluses. Yet Stevens, who lobbied for statehood in the 1950s, still sees Alaskans, the biggest beneficiaries of congressional largess, as victims of a high-handed federal government.

During his 2005 tantrum over Tom Coburn's proposal to move transportation money from Alaska to hurricane-stricken Louisiana (a proposal the Senate overwhelmingly rejected), Stevens repeatedly invoked his state's "sovereign" and "equal" status, seemingly worried that his colleagues were disrespecting Alaska behind his back. His attitude was reminiscent of a beggar who not only demands a handout but insists that everyone pretend the money was his all along.

Shill Here, Shill Now

dweigel@reason.com (David Weigel) — Fri, 15 Aug 2008 15:00:00 EDT

“I taught in the second Earth Day,” Newt Gingrich recalled in Real Change, published in January, the most recent of his annual, not-quite-consistent handbooks for conservatives. As gas prices hovered around $3 per gallon, Gingrich told good men of either party to look at tax credits for companies that curb their pollution, or for homeowners who slap solar panels on their roofs, or for drivers who get rid of their gas-guzzlers. The former speaker of the House made a soft-focus ad for Al Gore’s WE campaign, sharing a weather-exposed sofa with Nancy Pelosi, fretting about our oh-so-fragile climate. “We have an obligation to be good stewards of God’s creation for future generations,” Gingrich wrote.

Gingrich had one more idea about energy independence, tossed into his book like an afterthought. “With appropriate safeguards to protect the environment,” he wrote, “we can build more refineries and drill oil offshore to lower the cost of gas and reduce dependence on foreign oil.” A 33 percent gas price spike later, that’s all Gingrich wants to talk about. Offshore drilling has grown from one part of an earth-hugging energy plan to a panacea for gas prices. His leadership group, American Solutions for Winning the Future, hit on a slogan for cutting energy costs: “Drill Here, Drill Now, Pay Less.”

It worked. On August 1, the majority party adjourned for five weeks, delaying a decision on legalizing new drilling or (more likely) expanding tax credits until September, when the 1990 ban on offshore drilling will expire. Republicans erupted, giving speeches to an empty (and dark) chamber demanding that they stick around until the ban could be repealed. Arizona Rep. John Shadegg “started typing random codes into the chamber's public address system and accidentally typed the correct code, allowing Republicans brief access to the microphone before it was turned off again.”

Suddenly, the GOP had a message that made Democrats quiver. “They refuse to let us drill here, drill now, and pay less for gasoline,” says endangered Rep. Randy Kuhl (R-NY) in a new ad. ”We need to drill here and we need to drill now,” says longtime anti-ANWR drilling advocate John McCain, flicking the pesky ghost of Teddy Roosevelt off his shoulder.

But what’s been more interesting is the spontaneous order that’s sprung up to support the GOP’s newfound drill-here-drill-now dogma. Because of technical limitations (no cameras are allowed on the House floor), Republican members and their supporters recorded their progress with text messages and Twitter.com. That was the impetus for supporters far outside D.C. to get organized. “I had been following Culberson and [Heritage Foundation web wizard] Rob Bluey on Twitter and was getting overwhelmed,” said Chicago media consultant Eric Odom. ”I started a hash tag, #dontgo, to follow the updates.” Voila: #dontgo took off like a V-2 rocket, spawning a website that drew 10,000 members and tens of thousands of hits within 24 hours.

And then…well, not much. I was out of town for the hottest week of the #dontgo protest, as doughty congressman after doughty congressman took to the House floor to demand a MacArthur-like return from Nancy Pelosi. It peaked on August 6, when Gingrich airlifted himself onto the Hill to praise the movement he’d sort of created. But when I arrived on the Hill this Tuesday, the movement was already dying down. One member was standing vigil; Democratic staffers and tourists didn’t realize the protest was still going on.

I asked a conservative think-tanker who’d been toiling over drill-here-drill-now messaging what, exactly, had happened. “Nancy caved,” he said. He was referring to Pelosi’s statement on CNN that she might allow a vote on drilling after all.

But was that a real victory, or just cagey Democratic politics? Pelosi has been telling Democrats to come out for offshore drilling if it will help them win their races, and the candidates have followed suit. The think-tanker nodded. “We don’t want to get everything this year,” he said. “We want an issue. The Democrats do something this year, just enough to protect their incumbents. They take over next year, and it’s an issue again next year, and in 2010, because they’re never going to do anything serious.”

The rest of the week only strengthened the sense of inertia about this movement: It had risen fast and then plateaued. “They’re not doing anything new,” GOP web consultant David All told me. “It feels like it’s slowed down.”

That was inevitable. It’s hard to keep anger up about high gas prices when they’re heading slightly downhill. In the past few weeks, as Pacific Research Institute scholar Tom Tanton points out, the dollar has strengthened against the Euro. Crude oil demand has plummeted, the biggest decline since the recession year of 1982. And future traders are already expecting Congress to soften up laws against oil exploration. The House protest—and Gingrich’s triumphant messaging—had some impact, but that’s already been priced in. “The ban’s going to expire if Congress simply does nothing,” Tanton says.

All of this—the opportunistic Gingrich slogan work (he’s running a “drill here, drill now, pay nothing!” contest), the Republican gamesmanship—has opened up #dontgo to mockery from the liberal blogs. “They call us ‘twitiots,’ Odom sighs. But I can see #dontgo, or its moveable parts, succeeding despite their origins. David All, who thinks the momentum has tapped out, points out that his fellow Gen X and Y tech consultants—Heritage’s Bluey, Patrick Ruffini—had collaborated for the first time. Odom, a Republican who voted for Ron Paul in the primaries and supports Bob Barr in the general election, is lining up new targets for his website and mailing list. One of them is T. Boone Pickens, the Texas billionaire currently flooding your airwaves with ads about America’s wind corridor and the need to get off foreign oil. (Go flick on the TV and wait a bit. You’ll see it.)

”I’m very skeptical of the T. Boone scheme,” Odom says. “It’s one thing to solve this problem by opening up new markets, like new areas for drilling. It’s quite another to lobby, as Pickens is doing, for tax incentives and public money to fund a pet project.” Speaker Pelosi, after all, holds shares in Pickens’ company Clean Energy. California’s Proposition 10, which she supports, would pour $5 billion into wind farms. It’s the sort of rent-seeking that’s awfully easy to sell politically. Evidence? Just look back at the pleasant-sounding tax incentives that Gingrich was pushing eight months ago, in his previous attempt at Republican branding.

The grassroots members of the movement aren't growing wildly at the moment: Odom says his list has added 5,000 members in the week since the initial burst. But they aren't as easily guided or bought. Odom wants #dontgo to be part of something as roiling and proactive as MoveOn.org (complete with dated name—"Yes, I understand the irony of a conservative cause that tells Congress not to go home"), focusing on earmarks, or entitlement spending. David All, the consultant who was skeptical about the House protest side of the movement, told me the same thing: The movement can grow it if it seeks out new political territory.

A populist small-government movement that sticks to principles instead of easy messaging, fads, and the whims of donors? Maybe here, maybe now.

David Weigel is an associate editor of reason.

Dead on the Fourth of July

jwalker@reason.com (Jesse Walker) — Tue, 08 Jul 2008 12:00:00 EDT

The first time I met Jesse Helms was in 1981. My fifth grade class had risen early, boarded a bus in North Carolina, and taken a five-hour trek to Washington, where we tried to pack a week's worth of civic tourism into a single day. Zipping through the U.S. Senate, we filed in for a photograph with our state's senior senator.

"So these children are from Raleigh?" Helms said to a staffer.

"No," came the reply. "Chapel Hill."

A hint of a scowl crossed the Republican legislator's face. Or maybe it just seemed that way to me, knowing as I did that he hated my hometown and the liberal-leaning university it contained. When the state was mulling a plan to build a zoo, Helms had cracked that it should just put a fence around Chapel Hill.

That would not be an appropriate comment for this occasion, so our host changed the subject. His eyes scanned the crowd of kids, and apparently they fell on my nametag. Before I understood what was happening, he was shaking my hand. "My name's Jesse, too," he drawled. "Maybe we're related!" I stood there dumbly, surprised and paralyzed; before I knew it, my namesake was gone and we were marching to the next stop on the tour.

One of the class chaperones fell into step beside me. "Thanks," he said, "for not spitting in his face." I got the impression from his tone that a part of him would have liked it if I had spat at the senator. If Jesse Helms hated Chapel Hill, then virtually everyone I knew from Chapel Hill hated Helms right back.

By the '90s that contempt had spread far beyond our city and state. If you asked the average liberal about Helms in 1995, there were two things he was likely to tell you: that the senator was a racist and that the senator was a censor. The evidence for the first charge, if you cared to ask, would be a TV ad he ran in his 1990 campaign, in which a white man crumples a job application after a racial quota keeps him from finding work. The evidence for the second charge would be Helms' crusade against the National Endowment for the Arts, a federal program that funded material he considered obscene.

In other words, the typical Helms-bashers were actually prettifying the picture. The man was a Jim Crow nostalgist who wanted to obliterate the line between church and state, and they were whining about his run-of-the-mill conservative stances on affirmative action and Robert Mapplethorpe. You'd think Helms was just another Republican, notable only for his accent and his ties to the tobacco industry. But he was much more than that. You needn't favor racial preferences or federal art subsidies to find Jesse Helms objectionable.

Helms was, almost literally, a child of the segregationist order. His father was a cop in Monroe, North Carolina; in his recent book Righteous Warrior: Jesse Helms and the Rise of Modern Conservatism, the historian William Link writes that the senior Helms "was expected to maintain the racial hierarchy through intimidation and, if necessary, brute force." (Link quotes a black Monroe woman who said the officer used "his power to the fullest, in the wrong way.") The constable's son came to prominence as a defender of that racist regime, but he made those old arguments in a new medium, reading virulent editorials on WRAL-TV in the '60s. "Are civil rights only for Negroes?" he said in one 1963 broadcast. "White women in Washington who have been raped and mugged on the streets in broad daylight have experienced the most revolting sort of violation of their civil rights. The hundreds of others who had their purses snatched last year by Negro hoodlums may understandably insist that their right to walk the street unmolested was violated."

In the 1950s, an alliance emerged between free-marketeers and segregationists. It was not an inevitable union: Jim Crow laws were, in addition to all their other injustices, an intrusive array of restrictions on freedom of contract and freedom of commerce. But the alternatives suggested by the civil rights movement often restrained those freedoms from the other direction, opening space for a coalition that would have seemed much stranger a generation earlier. Thus, in 1964, the Deep South voted for Barry Goldwater, a man who had taken the lead in desegregating his family's department store, the Arizona Air National Guard, and the Phoenix public schools years before the law required any of those institutions to be integrated. He had also voted for federal civil rights bills in 1957 and 1960. But he shared the segregationists' hostility to two provisions of the 1964 Civil Rights Act, and that mutual interest allowed conservative activists to create a political realignment.

If Goldwater relied on the votes of racists he despised, then Helms was the other side of the alliance: a segregationist who could speak the language of liberty but never really adopted freedom as a principle. Helms realized early on that it looked better to position yourself as a foe of big government than as a defender of state-created privileges, so he preferred to talk about the new powers the federal government was claiming, not the old powers the state government had exercised for decades. In other words, he learned to talk like Goldwater. But there's little doubt that his sympathies lay with the larger system of legally enforced white supremacy. Helms maintained that the South had no racial problems until the feds "manufactured" them; according to Link, he established quiet ties to the White Citizens' Councils and similar groups.

Helms' anti-statist rhetoric wasn't entirely a pose. As a Raleigh city councilman in the '50s, for example, he led a lonely fight against the federal urban renewal program. But anyone tempted to believe the right-wing direct-mail king Richard Viguerie's eulogy for the senator—sample quote: "It's the free market views, policies, and leadership of President Reagan, Jesse Helms, and Milton Friedman that have led the world to experience the greatest movement out of poverty in history"—should review Helms' record in office. As far as economic policy was concerned, his chief concerns were preserving and extending the trade barriers that protected North Carolina's textile industry and the subsidies that supported North Carolina's tobacco farms.

In social policy, Helms favored anti-porn statutes, "voluntary" school prayer, and—"in the best interest of public health"—sodomy laws. In international affairs, he pushed for U.S. aid to some of the most repellent figures on the world stage, from the Salvadoran death-squad organizer Roberto D'Aubuisson to the Mozambican terror group RENAMO. After the Cold War ended, some critics of American foreign policy hoped that Helms' hatred of the United Nations and nonmilitary foreign aid would transform him into an old-fashioned isolationist who eschewed foreign entanglements. That isn't how it worked out. Over the course of the decade, Helms sponsored bills to tighten the embargo against Cuba and to send $100 million in military aid to Bosnia. After some early dithering, he also came out for expanding NATO into Eastern Europe. By the end of his career, he couldn't even hold the line against the foreign aid he loved to criticize: Under the influence of his buddy Bono, Helms put his weight behind a $200 million assistance package for Africa.

In other words, the man was no more committed to limited government abroad than he was committed to it at home. But he maintained his reputation as a skinflint isolationist. And why not? A good politician knows how to lie, and Helms was an expert politician.

1983: another school, another field trip to Washington, another audience with the man who shares my name. Now a smartassed seventh grader, I set a goal for myself. Tired of receiving mass-produced deceptions via the newspapers and television, I would get a legislator to lie to me personally. I approached the senator. "Excuse me, Mr. Helms," I said in a deferential tone. "My name is Jesse Walker. I don't know if you remember me, but we met a couple years ago on another class trip."

The senator took the bait: "Why, of course I remember you, Jesse." He smiled warmly, looked me straight in the eye, spoke in a confidential tone, and gave me the heartiest handshake I had ever encountered.

It should have been a private moment of triumph. Instead it taught me what a born politician can do. For a second, I forgot the whole plan and believed him.

Jesse Walker is reason's managing editor.

Don't Let the Bed Bugs Bite Act of 2008

rbalko@reason.com (Radley Balko) — Mon, 07 Jul 2008 15:57:00 EDT

Now under consideration in Congress: a bill appropriating $50 million per year through 2012 to fight . . . bed bugs.

And yes, that’s the actual name of the bill.

Don Young Gets Medal-of-Freedomed

rbalko@reason.com (Radley Balko) — Mon, 30 Jun 2008 10:00:00 EDT

A cabal of allegedly free market advocacy groups has inexplicably bestowed Rep. Don Young (R-Alaska) with a "Hero of the American Taxpayer" award.

The link above explains why that's not a terribly bright idea.

Or Perhaps I Should Say "Less Unpopular"

jwalker@reason.com (Jesse Walker) — Tue, 24 Jun 2008 13:50:00 EDT

Glenn Greenwald spots something interesting in a recent Fox poll: As of last week, the Democratic Congress is more popular among Republicans than Democrats.

He Could've Beat Those Dirty Lakers

mriggs@reason.com (Mike Riggs) — Fri, 20 Jun 2008 11:20:00 EDT

Twenty-two years ago yesterday, University of Maryland star forward Len Bias died of a cocaine overdose. In the wake of his death, Congressman James C. Wright, Jr. (D—Texas), proposed the 1986 Anti-Drug Abuse Act—which, in the course of "providing strong Federal leadership in establishing effective drug abuse prevention and education programs," and "halting international drug traffic," established minimum sentences for the possession or sale of illicit substances.

Wright resigned from Congress in ~~1986~~ 1989, disgraced after committing an ethical faux pas or two, and the University of Maryland has a new (decent) power forward to worry over in Landon Milbourne, but the federal minimum sentencing laws are still around.

It's a crying shame that Bias, who signed with the Celtics two days before he died and likely could've been part of the dynasty that beat those dirty Lakers, is remembered more as the impetus for draconian drug laws than as a hoopster with a heart of gold and a sick inside game.

Check out Senior Editor Jacob Sullum's article on minimum sentencing here, and those of you who aren't too old to engage in "social networking" can check out reason's new Facebook page here.

Permanent rEVOLution

dweigel@reason.com (David Weigel) — Thu, 05 Jun 2008 12:00:00 EDT

Amit Singh is 33 years old. If you were tending a bar when he walked in, you’d probably card him. Before his April speech to a slowly filling restaurant in Alexandria, Virginia, he ambles around the room, grabbing shoulders, shaking hands, smiling sheepishly. Friends who have shown up to support the unassuming defense industry engineer sit nearby, bemused.

“When he first showed me his website,” says Orrin McNamara, one of Singh’s neighbors, “I said: ‘Is this a joke? Amit for Congress?’ Seriously, I thought it might have been a joke.” He ponders for a moment. “I don’t know what the joke would have been.”

A bit after 7 p.m., Singh walks to the podium and sounds like what he is: a Republican congressional candidate. He talks about a “new vision for a brighter future.” Boilerplate, candidate-from-a-kit stuff. Singh smiles and darts his eyes down when he draws applause and laughs nervously when he takes a swipe at his Democratic incumbent. He doesn’t sound comfortable—until the speech shifts.

“We’ve seen how the politics of fear chip away at freedom at home,” he declares, sounding suddenly sure of himself. “Where are the defenders of freedom today? Where are our Thomas Jeffersons? Where are our Barry Goldwaters? There are a few defenders of freedom, but they are outnumbered, and they need our help.”

Singh has one particular defender of freedom in mind: Rep. Ron Paul (R-Texas). It was Paul’s libertarian-minded presidential campaign that got Singh into politics, first as a donor, then as a Virginia volunteer, and now as a candidate for Congress. A month after watching Paul score 4.5 percent of the vote in the Virginia primary, Singh threw his hat into the ring for the 8th District congressional seat.

By the end of the 2008 elections, as many as 40 self-proclaimed Ron Paul Republicans will have run for national office. The reception they are getting from their state parties ranges from warm embraces to Terminator-like efforts to destroy them. After a year of supporting a presidential candidate the party’s gatekeepers treated like a radioactive performance artist, the Paulites are used to ridicule. They want to carve out a permanent place in Republican politics, regardless of whether the party wants them to be there.

The Ron Paul Republicans come in two breeds. The first and largest category—about half the candidates collected on the aggregating site PaulCongress.com—are utter long-shots. They live either in districts where Democrats could hold fundraisers for the Rev. Jeremiah Wright and still win by landslides or those held comfortably by old-line Republican incumbents. David Wasserman, the House race editor for the Cook Political Report, says these candidates shouldn’t get their hopes up. “You can argue that it says something about the state of our democracy, the nature of the way districts are drawn, or the nature of incumbency,” Wasserman says. “We shut out a lot of viable people in these safe seats.”

Maryland’s Peter James lives in one of those districts of doom, a snaky, overwhelmingly Democratic gerrymander in the black suburbs of Washington, D.C. In the run-up to the February 12 primary elections there, James did the grunt work of organizing the Montgomery County Ron Paul Meetup group while hitting the pavement to win the Republican nomination for Congress. He spent $6,000 and all the free time a computer consultant can wrangle to win a primary against two other candidates—one of them another Ron Paul Republican.

“We had some Libertarian Party activists, some conservative Republicans, and about a third of the people we had were liberal Democrats who didn’t like their party’s candidates,” James says. “I’d go up to someone and tell them I was running for Congress. They’d ask the party. I’d say, ‘Republican.’ They’d say, ‘I can’t vote for you.’ Then I’d say, ‘I’m a Ron Paul Republican.’ And they’d say, ‘Oh! Well, I like him.’ ”

Maryland is ground zero for Ron Paul Republican candidates. Six of the state’s eight congressional districts are held by Democrats; four of the six Republicans running to challenge them were volunteers for Ron Paul. The Maryland Republican Party, which was kicked to the curb in the 2006 midterms, is happy to have them. “We welcome everyone to the Republican Party,” says state party Executive Director John Flynn. “We’re in the minority! Two years ago we didn’t even field candidates for two of these races, so the Ron Paul Republicans are really adding something.”

Like the man who inspired them, Paul’s flock deviates far from the Bush-era GOP’s platform and organizing tactics. When I ask Peter James what he has done to coordinate with the other three Maryland Ron Paul Republicans, he says they’ve talked about launching a viral video or a newspaper. One of James’ “main issues” is “providing an alternative currency,” not exactly a mainline Republican talking point. Flynn doesn’t mind; he shrugs that it’s “one of Peter’s issues.”

Other state parties are less welcoming. John Wallace is a 64-year-old New York real estate broker who started working for Paul, in part, because “he was the only one talking about the North American Union,” an alleged plot to merge the U.S. with Canada and Mexico. Wallace jumped into a primary for a suburban seat that Republicans lost in 2006; the party was backing the millionaire former party chairman Sandy Treadwell to try to seize it back. “I’ll go to one of these county meetings,” Wallace says, “and people will say to me: ‘My God! You’re right on the money. That was the greatest thing I’ve ever seen.’ Then they’ll head back to the table and vote for Treadwell.”

Ron Paul himself has endorsed just four of his followers-turned-candidates, and one of them, Jim Forsythe, dropped out of his New Hampshire congressional race in April because he lacked funds and name recognition. The others—including New Jersey’s Murray Sabrin and North Carolina’s B.J. Lawson—have drawn opposition from local Republicans unwilling to take the Paul plunge. (Paul has also endorsed Peter James.)

Paul’s reticence stems from not wanting to see his name attached to some candidate with whom he might not agree. “If you have some name recognition and some money, you have to be careful,” he says. “To say, ‘I’m a Ron Paul Republican,’ and to expect some money and an endorsement from me—I don’t think that’s a good idea.”

The other breed of Ron Paul Republican is neither tolerated as a sacrificial lamb nor pushed away as a nuisance. He is the candidate with a fighting chance for a seat the Republicans genuinely hope to contest. Amit Singh isn’t counting on a Paul endorsement as much as he’s trying to create a local version of the Ron Paul revolution. Mark Ellmore, the Republican candidate who lost the 8th District nomination in 2006 and has been running for it ever since, warns that Singh will “have trouble securing the Republican base,” but that’s as far as the insults go. “Ron Paul supporters are absolutely great for the Republican Party,” Ellmore says.

So while national Republicans never took Ron Paul seriously, Virginia Republicans are sizing up Singh with interest. An internal poll shows him in striking distance of a primary win. Statewide Republican leaders, warm to the idea of an Indian-American candidate, are considering official endorsements.

Ellmore’s hail-fellow-well-met attitude is something new for Ron Paul Republicans. They have spent a year being mocked while posting campaign signs, hustling into straw polls, and Googlebombing the Internet. If they had dissolved after the GOP nomination was locked up, that’s where their legacy might have ended. Instead they’re putting together the first outlines of a political bloc, one that’s increasingly independent from the activities of Paul himself. Even if none of them wins this November, they’re beginning to force the party to take them seriously at last.

David Weigel is an associate editor of Reason.

Farm Bill Follies

rbailey@reason.com (Ronald Bailey) — Wed, 30 Apr 2008 12:00:00 EDT

The $300 billion farm bill is being cobbled together by Congress this week. As Senate Agriculture Committee Chairman Tom Harkin (D-Iowa) noted, "It's not just a farm bill. This is a farm and a food and an energy bill."

As Otto von Bismarck quipped, "Laws are like sausage. It's better not to see them being made." Let's take a look at these three aspects of this unappetizing piece of sausage.

First, what do the farmers get? Answer: A lot. Last year, net farm income reached a record level of nearly $89 billion due to high crop prices. Farm household income averaged $84,000 in 2007, according to the Environmental Working Group (the 2006 average for all U.S. households was $66,000). Despite such good times, the federal government showered $5 billion in direct payments on 1.4 million farmers.

These direct payments have nothing to do with crop productivity or a safety net in case of low prices—they are basically gifts to farmers just because they are farmers. In fact, farmers with gross incomes up to $2.5 million have been eligible for these payments. President Bush wants to cap that at $200,000 in income, but the House is considering a cap of $500,000, and the Senate voted to cap the payments at $750,000 per year in income. Overall, Congress shaved just 2 percent off of the direct payments of $5 billion per year over the next four years. While this is a barely discernible improvement, one would think record high farm incomes combined with a world food crisis would make this a good time for Congress to scrap farming subsidies altogether.

It is true that about two-thirds of farm-bill spending funds nutrition programs such as school lunches and food stamps. Lawmakers added $10 billion to the food stamp program to help lower-income Americans address higher food prices. But why are food prices higher in the first place? Part of the reason is the federal government's subsidies and its mandate to turn food into fuel—which brings us to the legislation's energy policy madness.

In December, Congress passed and President Bush signed the Energy Independence and Security Act, which mandated that the U.S. produce 9 billion gallons of conventional biofuels this year. The Act requires that 15 billion gallons of conventional biofuels be produced by 2015 and that 36 billion gallons of conventional and "advanced" biofuels be produced by 2022. How does this affect food prices?

Higher corn prices result from biofuel mandates and subsidies, which encourage farmers to plant fewer acres of wheat and soybeans—which in turn raises their prices. In addition, corn is the chief feed grain for which producers of beef, poultry, and pork must pay higher prices which they will eventually pass along to consumers. In 2006, a bushel of corn sold for just under $2; today it sells for nearly $6.

Currently, most biofuels are produced by turning corn into ethanol. The U.S. Department of Agriculture estimates that the 2008 corn crop will be 14.6 billion bushels, of which 3.2 billion[*] bushels will be fermented into ethanol. In other words, about 22 percent of our corn crop will be floating out the tailpipes of our automobiles next year.

The new farm bill contains a small gesture in the direction of sanity by reducing bioethanol subsidies from 51 cents per gallon to 45 cents per gallon. This should reduce the price of a bushel of corn by about 3 cents, according to the Des Moines Register. On the other hand, Congress is trying get around the unintended consequences of its biofuels policy by offering $1.01 per gallon subsidy for so-called cellulosic ethanol. Large-scale production of cellulosic ethanol has yet to take off, so the farm bill also disperses $400 million in tax credits in the hope of jumpstarting such production. In addition, the bill extends the tariff on imported ethanol until 2012.

The biofuel mandate is not the only reason for higher food prices—higher oil and fertilizer prices as well as commodity speculation also contribute substantially.

But there's no excuse for Congress to make matters worse with this farm bill. As Rep. Ron Kind (D-Wis.) declared, "Negotiators managed to avoid every opportunity to reform wasteful, outdated subsidies while piling on additional layers of unnecessary spending." As a consequence, Americans can look forward to thinner wallets as they struggle to fuel their cars and feed their kids.

Ronald Bailey is reason's science correspondent. His book Liberation Biology: The Scientific and Moral Case for the Biotech Revolution is now available from Prometheus Books.

[*]: Due to an editing error, this originally read million.

"Frankly, These People Are Economically Illiterate"

kmw@reason.com (Katherine Mangu-Ward) — Thu, 10 Apr 2008 12:00:00 EDT

Here's a tasty tidbit from a Roll Call story about the many members of Congress--especially those who will be making decisions about congressional action in response to the banking crisis and coming recession--who have been taking a beating in the market:

Cleta Mitchell, a lawyer who works with many GOP Members on their financial disclosure statements, suggested...that it's not surprising that nearly 10 percent of lawmakers may be out millions of dollars because of the current credit collapse.

“Frankly ... these people are economically illiterate,” she said.

Sen. John Kerry (D-Mass.), for example, may face as much as $2.9 million in banking stock losses, according to the story. None of the affected senators have announced any intention to recuse themselves from decisions about bailouts and regulatory changes, either on the grounds of conflict of interest or on the ground of economic illiteracy.

Via The Weekly Standard

Now Playing at Reason.tv: Rep. Jeff Flake on U.S.-Cuba Policy

Thu, 13 Mar 2008 16:30:00 EDT

...

Really Full Disclosure

bdoherty@reason.com (Brian Doherty) — Tue, 26 Feb 2008 12:21:00 EST

New way to bedevil those working in and for Congress, from the website LegiStorm's press release:

LegiStorm, the Web site that first caused controversy in Washington by publishing congressional staffer salaries, has now launched the first database of personal financial disclosures for thousands of the most powerful aides.
By law, members of Congress and their highest paid staff - who tend to be the most powerful on Capitol Hill - are required annually to disclose information about their personal finances, including details about their debts, stock portfolio, outside earned income, spousal employment, major gifts received and even their gambling winnings.
..........

Rules from the House of Representatives state, "The objectives of financial disclosure are to inform the public about the financial interests of government officials in order to increase public confidence in the integrity of government and to deter potential conflicts of interest."
[LegiStorm founder Jock] Friedly expects controversy with the new free database. "I understand that congressional aides want to jealously guard their privacy and I sympathize," he said. "However, these are the behind-the-scenes power players who control a $3.1 trillion federal budget and write all the laws of the land. It's hard to argue that they are not important public figures worthy of a little scrutiny."

Start your private investigation at LegiStorm today!

Ron Paul: Don't Let Them Gilchrest Me

bdoherty@reason.com (Brian Doherty) — Tue, 19 Feb 2008 13:57:00 EST

Fearing defeat in his March 4 primary contest for his congressional seat in Texas, Ron Paul calls on those who gave so surprisingly and generously to his presidential run to give now to his congressional race.

My February reason cover feature on Ron Paul and his fans.

UPDATE: For details on why Paul thinks he needs his supporters' help and pronto, see this from Pajamas Media saying internal polls from both Paul and his opponent Chris Peden have Paul behind 11 points.

Leaving Wayne's World

jwalker@reason.com (Jesse Walker) — Wed, 13 Feb 2008 10:11:00 EST

With 98 percent of the votes counted, it looks like Maryland Rep. Wayne Gilchrest, one of a small handful of antiwar Republicans in Congress, has been defeated by the Cockeysville conservative Andy Harris. (Gilchrest's other major challenger, E.J. "Rupert" Pipkin, finished third.) Harris had been endorsed by the anti-tax, anti-spending Club for Growth because of his "consistent track record of fighting for limited government and pro-growth policies." Unfortunately, Harris' "consistent track record" includes his support for an unnecessary war that has already cost over $1 trillion. I have plenty of problems with the incumbent's economic record, but on the most important issue related to fiscal conservatism in the last 10 years, Gilchrest has been right and Harris has been wrong.

It's far from certain that Harris will be able to defeat Democrat Frank Kratovil. The Dems will pour money into taking the district now that their sometime-ally Gilchrest is out of the picture; and Harris, who lives on the western side of the Chesapeake, will have a hard time attracting votes from the Eastern Shore.

The country faces an ugly choice this November: Either elect a Republican president and reaffirm the Bush foreign policy, or elect a Democrat and put both the White House and Congress in the hands of the same party. If the First District of Maryland turns against one of Washington's few antiwar Republicans and then hands his seat to a Democrat, it will have somehow managed to embrace the worst of both worlds.

Elsewhere in Reason: Dave Weigel interviewed Gilchrest last May, and he looked at the congressman's primary fight yesterday.

Lord of the Gadflies

dweigel@reason.com (David Weigel) — Tue, 12 Feb 2008 15:00:00 EST

Last Thursday, Rep. Ron Paul (R-Texas) took the stage at the Conservative Political Action Conference to give a political speech more gripping and more combative than almost anything he'd said in his year-long campaign. The candidate who had to be pushed and pushed to talk about his opponents' records turned a machine gun on John McCain: the GOP frontrunner was wrong on Iraq, on campaign finance reform, on immigration. A crowd of half-skeptical conservatives who'd been backing Mitt Romney only a few hours earlier perked up. Here was a guy worth casting a protest vote for.

Later, when those conservatives were either deep in sleep or deep in their cups, Paul's campaign put out a press release announcingthe beginning of the end of the rEVOLution. "With Romney gone," the statement said, "the chances of a brokered convention are nearly zero." The Paul campaign was going to downsize—"I am making it leaner and tighter." And most important, the campaign admitted "another priority" for Paul, namely victory in the race for his Texas House seat. "If I were to lose the primary for my congressional seat," Paul wrote, "all our opponents would react with glee, and pretend it was a rejection of our ideas. I cannot and will not let that happen."

Paul volunteers took the news hard. One organizer in an early primary state called me to gripe about the apparent surrender of the national campaign, wondering if the whole rEVOLution had been a scam to build a big donor list. But there's another, more likely explanation: Paul is legitimately concerned about holding on to his seat. Chris Peden, an ambitious businessman and councilman from Friendswood (pop. 32,460), has overcome a slow start and is buying anti-Paul advertisements which pound home the message that to question the foreign policy that led up to 9/11 is to "blame America first."

Peden has raised enough money and buttonholed enough GOP poo-bahs in the district to put a scare into Paul, who is only the latest torchbearer of a 2008 trend—purging the odd man out. Consider also the case of another failed presidential candidate, Rep. Dennis Kucinich (D-Ohio), whom Paul spoke fondly of last year, and who said he might give Paul the vice presidential slot in his own White House. Kucinich is in critical danger of losing his Cleveland-area House seat to Democrats bored of his publicity-seeking and presidential bids. The Cleveland Plain Dealer endorsedhis strongest opponent, and Kucinich has been reduced to rattling his tin cupin front of YouTube viewers.

Kucinich and Paul won't face voters until March 4, but Paul's anti-war House ally Rep. Wayne Gilchrest (R-Md.) is in a life-and-death battle today for his seat on Maryland's conservative shoreline. He's been challenged multiple times by candidates who are more socially conservative or more economically conservative, but the war issue has weakened him, and he has drawn one challenger who's funding his own race and another who's got the backing of the Club for Growth.

All of this occurs as Barack Obama, looking increasingly like the Democratic nominee, is cooing to primary voters about the need for a heavily Democratic Congress. In Virginia this weekend he claimed that he, unlike Hillary Clinton, would be able to bring a huge Democratic wave to Washington. Such a "progressive majority" would enact the change that eluded Bill Clinton in his first two years in power, before the GOP took over Congress. Before he announced that he loved the troops too much to continue running for president, Mitt Romney said much the same thing. Neither was simply suggesting his adversaries were too divisive (though they were certianly doing that). Both Obama and Romney get how the realignment of the parties and the fall of Southern Democrats has made the House more homogeneous, more like a quick-acting parliament. Just a decade and a half ago, a newly elected Democrat would have to make nice with a huge caucus of conservatives within his party and a newly elected Republican would have to kiss the rings of blue-blooded moderate members from the Northeast.

Those days are gone, and the truly contrary members of each party in Congress can be counted on two hands. The efforts to beat Paul, Kucinich, and Gilchrest are, effectively, efforts to make the parties completely monochromatic. Since the start of this Congress, only eight members have voted with their party less than 80 percent of the time, and two of them are Paul and Gilchrest. Republicans in Washington publicly say good things about Paul, but activists believe that their party should stand foursquare behind the War on Terror, behind the current GOP leadership in the House in Senate, and against the Democrats. There is no room for people like Gilchrest, who bucks the party on spending and environmental issues. On the other side of the aisle, there is no patience among Democrats for Kucinich, who holds his head up and votes down war bills he finds too milquetoast. Being "Dr. No" is no longer being conservative. Now, it's hurting the team.

That isn't an indictment of anti-incumbent challenges. If half of Congress was replaced every four years, who would complain? The troubles of Paul and Gilchrest and Kucinich, though, might put an end to the era of gadflies. Paul is probably right that his rEVOLutioneers will pick up their batons and march without him. He is also right that if he loses his House seat, they'll be much worse off, without a single representative who takes their stands. Today's congressional gadflies are learning that the arm-twisting and lock-stepping that once defined urban or local political machines can, aided by the media, go national. Congress will never be a bubbling cauldron of ideas, but it doesn't have to be as binary and as bland as the anti-gadfly campaigners wish.

David Weigel is an associate editor of reason.

Discuss this story at reason's Hit & Run blog.

The State Secrets Protection Act

bdoherty@reason.com (Brian Doherty) — Fri, 25 Jan 2008 19:55:00 EST

The ACLU welcomes a bill introduced by Ted Kennedy that will, supposedly, make it easier to challenge executive branch claims of "state secrets" to cover its legal ass. From its press release:

Senator Kennedy’s bill allows the court to review government national security claims, thus lowering the wall of the current state secrets privilege to just a hurdle. The current form of the privilege has allowed the administration to successfully hold off investigations into its extraordinary rendition program and its warrantless wiretapping program. The cloak must be lifted and we urge Congress to waste no time in passing Senator Kennedy’s bill.

Sen. Kennedy's own explanation, with detailed section-by-section summary, of the bill he introduced with Sen. Arlen Spector (R-Penn.). An excerpt:

In 1980, Congress enacted the Classified Information Procedures Act (CIPA) to provide federal courts with clear statutory guidance on handling secret evidence in criminal cases. For almost 30 years, courts have effectively applied that law to make criminal trials fairer and safer. ......

Yet in civil cases, litigants have been left behind. Congress has failed to provide clear rules or standards for determining whether evidence is protected by the state secrets privilege. We’ve failed to develop procedures that will protect injured parties and also prevent the disclosure of sensitive information. Because use of the state secrets privilege has escalated in recent years, there’s an increasing need for the judiciary and the executive to have clear, fair, and safe rules.

................

The State Secrets Protection Act we are introducing responds to this need by creating a civil version of CIPA. The Act provides guidance to the federal courts in handling assertions of the privilege in civil cases, and it restores checks and balances to this crucial area of law by placing constraints on the application of state secrets doctrine......

.....the Act enables the executive branch to avoid publicly revealing evidence if doing so might disclose a state secret. If a court finds that an item of evidence contains a state secret, or cannot be effectively separated from other evidence that contains a state secret, then the evidence is privileged and may not be released for any reason. Secure judicial proceedings and other safeguards that have proven effective under CIPA and the Freedom of Information Act will ensure that the litigation does not reveal sensitive information.

At the same time, the State Secrets Protection Act will prevent the executive branch from using the privilege to deny parties their day in court or shield illegal activity that is not actually sensitive. A recently declassified report shows that the executive branch abused the state secrets privilege in the very Supreme Court case, United States v. Reynolds (1953), that serves as the basis for the privilege today. In Reynolds, an accident report was kept out of court due to the government’s claim that it would disclose state secrets. The court never even looked at the report. Now that the report has been made public, we’ve learned that in fact it contained no state secrets whatever—but it did contain embarrassing information revealing government negligence.

In recent years, federal courts have applied the Reynolds precedent to dismiss numerous cases—on issues ranging from torture, to extraordinary rendition, to warrantless wiretapping—without ever reviewing the evidence.

The full text of the "State Secrets Protection Act" (S. 2533) was not yet up on Thomas.loc.gov on first posting.

Matt Welch from Jan. 2006 on even more ugly aspects of how U.S. v. Reynolds's b.s. precedent has been applied--in one case, to rob an inventor of his rights. Jacob Sullum from Aug 2006 on the Bush administration's overenthusiastic use of "state secret" privilege.

The Anti-Smoking Slippery Slope on Capitol Hill

bdoherty@reason.com (Brian Doherty) — Tue, 15 Jan 2008 11:06:00 EST

As goes Capitol Hill, so goes the nation? What started as a Pelosi-imposed smoking ban turns into a ban on even selling tobacco products in the hallowed halls of our precious democracy. The Politico explains.

Smoke 'em if you got 'em in reason's extensive tobacco archives. And read Jacob Sullum's breathtaking book on the anti-smoking movement.

Call That Bluff, Congress

bdoherty@reason.com (Brian Doherty) — Fri, 02 Nov 2007 10:16:00 EDT

Bush comes out with a blood-curdling threat to Congress: if they don't confirm Michael Mukasey for attorney general, why then the U.S. will just have to go to bed without any attorney general at all for the remainder of his term. Can justice survive? Will chaos reign? Why don't we find out?

Jacob Sullum's latest on the Mukasey confirmation hearings and some hints as to why he's so important to Bush: his willingness to presume the president can act above and beyond the law.

Finally a Game Just for Adults: Fantasy Congress (Insert Larry Craig Joke Here...No Here...Yes There)

gillespie@reason.com (Nick Gillespie) — Wed, 31 Oct 2007 13:43:00 EDT

reason reader and blogger Sandy Smith points us to the new simulation game, Fantasy Congress. From a writeup at Escapist mag:

Andrew Lee says he came up with Fantasy Congress in college, after watching his roommate obsess over fantasy football, and he frames his description of Fantasy Congress in fantasy sports terms. "Think of Fantasy Congress just like fantasy football," he says, "but instead of being a general manager of a football team, here you are the guy in the background who's picking and choosing the members of Congress that you think are gonna do well when they reconvene. Say, for example, you choose a number of members of Congress. ... It's exactly [like] fantasy football, except the metrics aren't touchdowns and interceptions."
Fantasy sports make use of preexisting statistics to determine how good a player is. Politics don't score that way, so Lee's team had to figure that out as they went along. "When we first started, we [used] legislation," he says. "Our users told us legislation is really boring. I can't tell when a piece of legislation is gonna be passed, but I can tell you, however, I can see when I read a piece of news - say, for example, right now with Senator Larry Craig from Idaho. He's in some trouble in terms of his bathroom incident. His scandal that's going on, I can see that. I'd like to be able to score points ... based off that. So we created a category for news mention. And in addition to that, you can actually see votes as they occur on C-SPAN. So people were interested in seeing votes."

More, including stories of players calling their congresshacks to improve their ratings and the greatest bio-line I've ever read ("Joe Blancato is an Associate Editor at The Escapist. His Fantasy Congress team, Team Wide Stance, is currently in fourth place in a 15-person league."), here.

Offical Fantasy Congress site here.

Me, I'm holding out for the Violent Fantasy Congress game.