Clinton’s Anti-bullying Proposal: Feel-good Federal Policy at Its Worst

Neal McCluskey

No decent person goes around saying, “I really hope those big, popular kids push around those little, different kids.” No one is in favor of bullying. But that’s what makes Hillary Clinton’s new anti-bullying proposal dangerous. There are numerous, significant reasons to oppose it, but there’s a huge risk those reasons will be ignored at best, or those who raise them smeared as bullying enablers — or even pro-bullying — at worst.

Clinton has proposed, among other things, spending $500 million — with states required to pitch in one dollar for every four federal dollars — to “develop comprehensive anti-bullying plans.” Those plans must:

1. Clearly describe prohibited behaviors, including verbal abuse and cyberbullying;
2. Include grievance procedures for students, parents and educators to address incidents; and
3. Explicitly prohibit bullying on the basis of race, color, national origin, sex, disability, sexual orientation, gender identity and religion.

The first problem is defining what “bullying” is. Just about everyone would agree that physical assault should be prohibited — and is already illegal. But what about “verbal abuse,” or messages on social media? Deeming these “bullying” can easily clash with a fundamental right: freedom of speech, not to mention expanding the scope of school officials’ surveillance to include expression totally outside of school.

Should American children and their basic rights be pawns in a political chess match?

Should a student be punished for saying he thinks homosexuality is sinful, even if it makes some classmates uncomfortable? Does he not have a right to express his religious beliefs free of government (which is what a public school is) punishment? If a school bans anti-gay speech, must it prohibit pro-gay expression? It seems so, lest it unjustly choose one group to silence and one to let speak. What about a student’s right to critique religious views he finds bigoted?

Suddenly, what seemed clear-cut is not.

That Clinton envisions federal coercion to take on bullying — something states are capable of doing on their own — makes the danger especially acute because it threatens the rights of every public school student in the country, and forces everyone into conflict over basic rights and values. Indeed, Clinton would double down on President Obama’s regulatory guidance threatening public schools with sanctions for failing to open their bathrooms and other single-sex facilities to transgender students. This has already caused a national firestorm, and numerous states to raise their defenses. Indeed, the United States Supreme Court just agreed to hear a Virginia bathroom case likely in part because the topic has become so heated, so fast.

Importantly, the federal government has authority under the 14th Amendment to prohibit discrimination in state and local provision of education. But that should be exercised in clear cases of discrimination.

Requiring students to use facilities aligning with their sex at birth, which has long been the seemingly unchallenged norm, does not appear to fall under that. Meanwhile, suddenly imposing a national “solution” seems to have sparked counterproductive resentment that might have been avoided had society been given a chance to evolve on its own. And, as with speech, there are contending rights involved, especially the right to privacy, to which many believe they are entitled.

That said, most of what Clinton has proposed is not grounded in the 14th amendment, but money: Washington takes tax dollars from people who live in states, then turns to states and says, “You want some of this back? You take our rules.”

That may not be bullying, but it sure sounds like coercion. And no matter what you call it, it’s illegal: The Constitution gives Washington no authority to govern education, including by spending money on it.

Finally, it is hard to conclude that Clinton’s decision-making wasn’t influenced by political strategy. It was almost certainly not a coincidence that the same day Clinton released her plan, she also released a campaign ad labelling Donald Trump a bully. She was able to portray herself as both a victim of, and the solution for, bullying. But should American children and their basic rights be pawns in a political chess match?

No decent person can defend bullying. Neither, however, should they support proposals that threaten basic rights and drive nationwide social conflict in the simplistic, politicized name of bullying prevention.

Neal McCluskey is a contributor to the Washington Examiner’s Beltway Confidential blog. He is the director of the Cato Institute’s Center for Educational Freedom and maintain’s Cato’s Public Schooling Battle Map.

Donald Trump vs. Hillary Clinton: the Trade-Policy Paradox

K. William Watson

Donald Trump has gotten a great deal of attention this year for his harsh rhetoric about trade and lost jobs. When his campaign has delved into more specific policies, however, he doesn’t offer much that’s different from Hillary Clinton. They both oppose new and old trade agreements, and they both want to use domestic trade laws and international dispute mechanisms more aggressively. Until now, the “debate” over trade has been mostly about trust, with Clinton accusing Trump of being a hypocritical “outsourcer” and Trump accusing Clinton of secretly supporting trade deals she publicly opposes.

With just a few weeks left in the campaign, the candidates have finally stumbled upon divergent concrete policy proposals regarding trade. Unfortunately, both proposals amount to nothing more than meaningless fluff meant to sound like thoughtful reforms.

Clinton says she will create a “trade prosecutor” position “for the first time in history” to make sure our trade agreements are “enforced.” This proposal is surely meant to appeal to trade critics on the left who commonly complain that past presidential administrations have let foreign countries violate trade commitments without consequence.

The biggest problem with Clinton’s proposal is that this position already exists. U.S. efforts to bring dispute settlement cases at the World Trade Organization or under various other free-trade agreements are currently directed by the General Counsel at the Office of the U.S. Trade Representative.

Ultimately, Trump’s American Desk and Clinton’s Trade Prosecutor proposals are just smoke and mirrors, used to disguise the fact they don’t actually have creative or unique trade policy ideas.

What’s more, this office has been quite busy over the years representing the United States in dozens of cases brought by and against the United States at the WTO. In 2016 alone, the Obama administration brought two new cases against China over farm subsidies and export restrictions while securing favorable rulings in ongoing cases concerning local content requirements in India and aircraft subsidies in Europe. Clinton has given no indication that her proposal amounts to anything more than renaming that existing office and hiring some more people to work in it.

Meanwhile, Donald Trump has proposed the creation of a new office in the Department of Commerce he is calling the “American Desk,” which would oversee numerous trade programs currently located in different cabinet departments.

Like Clinton’s proposal for a “trade prosecutor,” Trump’s “American Desk” proposal does not include any real change in policy, just a minor bureaucratic reshuffling. Trump explained his reasoning at a recent campaign event: “American trade policy is currently mismanaged by dozens of competing bureaucracies spread over the Departments of Agriculture, Commerce, Labor, State and Treasury, and the U.S. Trade Representative doesn’t know where he’s going.” In Trump’s administration, “all trade policy will be consolidated in to one office. It will report to a thing called the American Desk. I will call three times a day.”

Trump seems to believe that federal agencies will be more useful if someone regularly reminds them to work harder. But there’s no real reason to expect that rebranding reorganized federal agencies will actually change how those agencies operate, and the Trump campaign hasn’t offered any specific examples of how it could.

Interestingly, Trump’s reshuffling idea looks a lot like a proposal Barack Obama made late in the 2012 presidential campaign. Obama proposed creating a “Secretary of Business” that would oversee all of the federal government’s various business subsidy programs. The plan was criticized by the Romney campaign, which chided that Obama’s “solution to everything is to add another bureaucrat.”

Like Obama’s proposal, Trump’s reshuffling idea is politically impractical. Moving existing programs to a different department would take jurisdiction over those programs away from congressional committees whose approval would be required before the move takes place. In short, the initiative would require the administration to spend a lot of political capital for no real benefit.

Ultimately, Trump’s American Desk and Clinton’s Trade Prosecutor proposals are just smoke and mirrors, used to disguise the fact they don’t actually have creative or unique trade policy ideas. Voters will need to look elsewhere to distinguish between two candidates who both claim to be the only genuine protectionist on the ballot.

K. William Watson is a trade policy analyst at the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies.

Supreme Court Compromise: the Case for a Temporary Justice

Thomas Berry

Senate Republicans seem to face an almost apocalyptic choice: either confirm a lifetime appointment to the Supreme Court that could shift its ideological balance indefinitely, or continue to be labeled as an obstructionist party keeping a ninth vote off the Court.

This is a false dilemma. Congress can give the president his choice of a Supreme Court justice without allowing that justice to remain on the Court indefinitely. Such a short-term justice would be the best compromise available to both sides of a dispute that currently seems intractable.

Federal law currently allows both district court judges and retired Supreme Court justices to temporarily serve as circuit court judges, known as “sitting by designation.” My proposal is simple: Congress should pass a bill allowing the president, when a seat on the Supreme Court has been vacant for more than six months, to immediately assign either a circuit court judge or a retired Supreme Court justice to sit on the Supreme Court by designation.

Such a temporary “justice by designation” would hear cases and vote just like any other justice. However, the assignment of this temporary justice would be limited to four years, or until a permanent justice is confirmed, whichever occurs first.

First, the political question. Why should a Republican Congress consider passing such a bill, and why should a Democratic president consider signing it? For Republicans, a four-year-long filibuster of a Supreme Court nomination maintained by at least 41 senators is not politically viable. It increasingly appears that their best option among the probable alternatives is a lame-duck confirmation of Merrick Garland (as one Republican senator has already admitted).

The death of Justice Scalia has been a perfect storm sent to reveal the weaknesses in the current system of Supreme Court succession.

Since Republicans have this option of confirming a judge considered relatively old and moderate, why should they prefer the temporary promotion of any judge of Barack Obama’s choosing?

First, the relative age of a Supreme Court appointment is not nearly as important as the fact that lifetime appointees can time their own retirement. Justices clearly prefer to be succeeded by someone of their own judicial ideology. As two leading legal scholars have recognized, this gives any life-tenured justice an incentive “to time his or her departure with one eye on the political calendar and one finger in the political wind.”

The last five retirements from the Court have all fit this pattern, and the late Justice Scalia himself admitted that he “would not like to be replaced by someone who immediately sets about undoing everything that I’ve tried to do for 25 years.” It is not the tenure of a single lifetime appointee, but rather his indefinite chain of like-minded successors, that risks shifting the balance of the Court for decades. For Senate Republicans, a justice by designation who must leave the Court after the 2020 election would be vastly preferable.

Second, although Judge Garland has the reputation of a judicial moderate, disputes among members of the Court’s ideological wings (especially its liberal wing) rarely change the outcome of the Court’s decisions.

It was widely assumed that Elena Kagan would be a more moderate justice than Sonia Sotomayor. Yet the two have only disagreed in 7 of the 87 cases decided by a 5–4 margin since Justice Kagan joined the Court. Thus, their disagreements have changed the outcome in only 7 out of 419 total cases (1.7%) decided in the last six years. Senate Republicans should care much less about the relative differences between left-leaning appointees, and much more about how long their appointments will reverberate.

Given these benefits for Senate Republicans, why should a Democratic president consider signing such a bill? If the political wisdom is that Senate Republicans will eventually be forced to confirm a justice, why not simply wait them out?

The answer is that this political wisdom remains true only so long as Senate Republicans are perceived to be wholly responsible for the Court’s continuing vacancy. Passing a bill that guarantees no high court vacancy will ever last longer than six months (one similar to a bill introduced by Democratic Sen. Pat Leahy in 2010) would immediately change this dynamic. Should the president refuse to sign the bill (or should Senate Democrats filibuster it), he would be refusing the ability to install someone on the Court even faster than the normal confirmation process.

Senate Democrats have avowed that speed is of the essence in filling the Supreme Court vacancy; such a bill would put these assurances to the test. Further, the bill would allow the president to choose—temporarily—a liberal “dream candidate,” meaning he would face significant pressure from his own base to take the opportunity as one of his final “legacy-defining” acts.

There is a real chance, then, that such a bill could actually become law. But we must also address a second important question: would it be constitutional?

Two clauses of the Constitution are relevant to this question. First, all federal judges “shall hold their Offices during good Behaviour”—in other words, for life tenure. But temporary service by a federal judge on a particular court is nonetheless constitutional, so long as that judge continues to hold life tenure on some other court. This is shown by the longstanding practice of allowing judges to sit by designation. (Indeed, active Supreme Court justices frequently sat by designation on circuit courts until 1891, a practice known as “riding circuit”).

The proposed bill would satisfy the Good Behaviour Clause by limiting temporary appointments to circuit judges (who would return to their previous court after their assignment ends) and retired Supreme Court justices (who remain life-tenured members of the federal judiciary).

Second, the federal judicial power “shall be vested in one Supreme Court, and in such inferior courts as the Congress may from time to time ordain and establish.” Even if temporary assignments are acceptable for the lower courts, would a temporary justice on the highest court violate the requirement of “one Supreme Court”? This is unlikely, because there have already been 12 temporary justices on the Supreme Court.

Each of these 12 justices has reached the Court through the Recess Appointments Clause, which allows the president to “fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.” These 12 justices each served in a temporary capacity for one to two years, until they were either confirmed or rejected by the Senate.

The One Supreme Court Clause thus only requires that there be one identified set of justices with final adjudicatory power for any given case, not that all such justices be permanent members of the Court.

The death of Justice Scalia has been a perfect storm sent to reveal the weaknesses in the current system of Supreme Court succession. In the long term, the best solution may be a constitutional amendment giving justices a single 18-year term. But in the meantime, we need a short-term solution to get us through the current impasse, perhaps until two justices of competing ideologies can be simultaneously appointed as part of a grand bargain. A bill to allow a justice by designation is the best such short-term solution available.

Thomas Berry is legal associate in the Cato Institute’s Center for Constitutional Studies.

Supreme Court Compromise: the Case for a Temporary Justice

Thomas Berry

Senate Republicans seem to face an almost apocalyptic choice: either confirm a lifetime appointment to the Supreme Court that could shift its ideological balance indefinitely, or continue to be labeled as an obstructionist party keeping a ninth vote off the Court.

This is a false dilemma. Congress can give the president his choice of a Supreme Court justice without allowing that justice to remain on the Court indefinitely. Such a short-term justice would be the best compromise available to both sides of a dispute that currently seems intractable.

Federal law currently allows both district court judges and retired Supreme Court justices to temporarily serve as circuit court judges, known as “sitting by designation.” My proposal is simple: Congress should pass a bill allowing the president, when a seat on the Supreme Court has been vacant for more than six months, to immediately assign either a circuit court judge or a retired Supreme Court justice to sit on the Supreme Court by designation.

Such a temporary “justice by designation” would hear cases and vote just like any other justice. However, the assignment of this temporary justice would be limited to four years, or until a permanent justice is confirmed, whichever occurs first.

First, the political question. Why should a Republican Congress consider passing such a bill, and why should a Democratic president consider signing it? For Republicans, a four-year-long filibuster of a Supreme Court nomination maintained by at least 41 senators is not politically viable. It increasingly appears that their best option among the probable alternatives is a lame-duck confirmation of Merrick Garland (as one Republican senator has already admitted).

The death of Justice Scalia has been a perfect storm sent to reveal the weaknesses in the current system of Supreme Court succession.

Since Republicans have this option of confirming a judge considered relatively old and moderate, why should they prefer the temporary promotion of any judge of Barack Obama’s choosing?

First, the relative age of a Supreme Court appointment is not nearly as important as the fact that lifetime appointees can time their own retirement. Justices clearly prefer to be succeeded by someone of their own judicial ideology. As two leading legal scholars have recognized, this gives any life-tenured justice an incentive “to time his or her departure with one eye on the political calendar and one finger in the political wind.”

The last five retirements from the Court have all fit this pattern, and the late Justice Scalia himself admitted that he “would not like to be replaced by someone who immediately sets about undoing everything that I’ve tried to do for 25 years.” It is not the tenure of a single lifetime appointee, but rather his indefinite chain of like-minded successors, that risks shifting the balance of the Court for decades. For Senate Republicans, a justice by designation who must leave the Court after the 2020 election would be vastly preferable.

Second, although Judge Garland has the reputation of a judicial moderate, disputes among members of the Court’s ideological wings (especially its liberal wing) rarely change the outcome of the Court’s decisions.

It was widely assumed that Elena Kagan would be a more moderate justice than Sonia Sotomayor. Yet the two have only disagreed in 7 of the 87 cases decided by a 5–4 margin since Justice Kagan joined the Court. Thus, their disagreements have changed the outcome in only 7 out of 419 total cases (1.7%) decided in the last six years. Senate Republicans should care much less about the relative differences between left-leaning appointees, and much more about how long their appointments will reverberate.

Given these benefits for Senate Republicans, why should a Democratic president consider signing such a bill? If the political wisdom is that Senate Republicans will eventually be forced to confirm a justice, why not simply wait them out?

The answer is that this political wisdom remains true only so long as Senate Republicans are perceived to be wholly responsible for the Court’s continuing vacancy. Passing a bill that guarantees no high court vacancy will ever last longer than six months (one similar to a bill introduced by Democratic Sen. Pat Leahy in 2010) would immediately change this dynamic. Should the president refuse to sign the bill (or should Senate Democrats filibuster it), he would be refusing the ability to install someone on the Court even faster than the normal confirmation process.

Senate Democrats have avowed that speed is of the essence in filling the Supreme Court vacancy; such a bill would put these assurances to the test. Further, the bill would allow the president to choose—temporarily—a liberal “dream candidate,” meaning he would face significant pressure from his own base to take the opportunity as one of his final “legacy-defining” acts.

There is a real chance, then, that such a bill could actually become law. But we must also address a second important question: would it be constitutional?

Two clauses of the Constitution are relevant to this question. First, all federal judges “shall hold their Offices during good Behaviour”—in other words, for life tenure. But temporary service by a federal judge on a particular court is nonetheless constitutional, so long as that judge continues to hold life tenure on some other court. This is shown by the longstanding practice of allowing judges to sit by designation. (Indeed, active Supreme Court justices frequently sat by designation on circuit courts until 1891, a practice known as “riding circuit”).

The proposed bill would satisfy the Good Behaviour Clause by limiting temporary appointments to circuit judges (who would return to their previous court after their assignment ends) and retired Supreme Court justices (who remain life-tenured members of the federal judiciary).

Second, the federal judicial power “shall be vested in one Supreme Court, and in such inferior courts as the Congress may from time to time ordain and establish.” Even if temporary assignments are acceptable for the lower courts, would a temporary justice on the highest court violate the requirement of “one Supreme Court”? This is unlikely, because there have already been 12 temporary justices on the Supreme Court.

Each of these 12 justices has reached the Court through the Recess Appointments Clause, which allows the president to “fill up all Vacancies that may happen during the Recess of the Senate, by granting Commissions which shall expire at the End of their next Session.” These 12 justices each served in a temporary capacity for one to two years, until they were either confirmed or rejected by the Senate.

The One Supreme Court Clause thus only requires that there be one identified set of justices with final adjudicatory power for any given case, not that all such justices be permanent members of the Court.

The death of Justice Scalia has been a perfect storm sent to reveal the weaknesses in the current system of Supreme Court succession. In the long term, the best solution may be a constitutional amendment giving justices a single 18-year term. But in the meantime, we need a short-term solution to get us through the current impasse, perhaps until two justices of competing ideologies can be simultaneously appointed as part of a grand bargain. A bill to allow a justice by designation is the best such short-term solution available.

Thomas Berry is legal associate in the Cato Institute’s Center for Constitutional Studies.

When CIA and NSA Workers Blow the Whistle, Congress Plays Deaf

Patrick G. Eddington

DO THE COMMITTEES that oversee the vast U.S. spying apparatus take intelligence community whistleblowers seriously? Do they earnestly investigate reports of waste, fraud, abuse, professional negligence, or crimes against the Constitution reported by employees or contractors working for agencies like the CIA or NSA? For the last 20 years, the answer has been a resounding “no.”

My own experience in 1995-96 is illustrative. Over a two-year period working with my wife, Robin (who was a CIA detailee to a Senate committee at the time), we discovered that, contrary to the public statements by then-Chairman of the Joint Chiefs Colin Powell and other senior George H. W. Bush administration officials (including CIA Director John Deutch), American troops had in fact been exposed to chemical agents during and after the 1991 war with Saddam Hussein. While the Senate Banking Committee under then-Chairman Don Riegle, D-Mich., was trying to uncover the truth of this, officials at the Pentagon and CIA were working to bury it.

At the CIA, I objected internally — and was immediately placed under investigation by the CIA’s Office of Security. That became clear just days after we delivered the first of our several internal briefings to increasingly senior officials at the CIA and other intelligence agencies. In February 1995, I received a phone call from CIA Security asking whether I’d had any contacts with the media. I had not, but I had mentioned to CIA officials we’d met with that I knew that the CBS newsmagazine “60 Minutes” was working on a piece about the Gulf War chemical cover-up. This call would not be the last I’d receive from CIA Security about the matter, nor the only action the agency would take against us.

In the spring of 1995, a former manager of Robin’s discreetly pulled her aside and said that CIA Security agents were asking questions about us, talking to every single person with or for whom either of us had worked. I seemed to be the special focus of their attention, and the last question they asked our friends, colleagues, and former managers was, “Do you believe Pat Eddington would allow his conscience to override the secrecy agreement he signed?”

The agency didn’t care about helping to find out why hundreds of thousands of American Desert Storm veterans were ill. All it cared about was whether I’d keep my mouth shut about what the secret documents and reports in its databases had to say about the potential or actual chemical exposures to our troops.

We now live in a country where the committees charged with reining in excessive domestic spying instead too often act as apologists and attack dogs for the agencies they are charged with regulating.

Seeing the writing on the wall, I began working on what would become a book about our experience: “Gassed in the Gulf.” The agency tried to block publication of the book and attempted to reclassify hundreds of previously declassified Department of Defense and CIA intelligence reports that helped us make our case. After I filed a lawsuit, the agency yielded. We left and became whistleblowers, our story a front-page sensation just days before the 1996 presidential election. Within six months, the CIA was forced to admit that it had indeed been withholding data on such chemical exposures, which were a possible cause of the post-war illnesses that would ultimately affect about one-third of the nearly 700,000 U.S. troops who served in Kuwait and Iraq. None of the CIA or Pentagon officials who perpetrated the cover-up were fired or prosecuted.

Around this time, a small, dedicated group of NSA employees was trying to solve another national security problem: how to make it possible for the government to eavesdrop successfully in the age of the internet.

Led by NSA crypto-mathematician Bill Binney, the team developed an ingenious technical program called ThinThread, which allowed the NSA to process incoming surveillance information but segregate and discard the communications of innocent Americans. The program was innovative, cheap, and badly needed. But just months before the 9/11 attacks, then-NSA Director Michael Hayden rejected ThinThread in favor of an untested, expensive alternative called Trailblazer, offered by a Washington, D.C.-based defense contractor. It became a pricey boondoggle that never produced a single piece of intelligence.

Enraged that a program they believed could have prevented the 9/11 attacks had been jettisoned, Binney and his colleagues privately approached the House Intelligence Committee. When that failed to produce results, they issued a formal complaint to the Defense Department’s inspector general.

The subsequent investigation validated the allegations of the NSA ThinThread team. But in spite of this vindication, all who had filed the complaint were subsequently investigated by the FBI on bogus charges of leaking classified information. The episode is now the subject of an Office of Special Counsel whistleblower reprisal investigation, involving former NSA senior manager and ThinThread proponent Tom Drake. I have read the Defense Department inspector general report, which is still almost completely classified, and filed a Freedom of Information Act request seeking its declassification. The Pentagon has stonewalled my request for more than a year and a half.

Congress has made no effort to investigate any of this.

Within the small, tight-knit circle of ex-intelligence community whistleblowers and the nonprofit organizations that work on their behalf, the ThinThread/Trailblazer case became infamous. By early 2013, it had come to the attention of a young NSA contractor named Edward Snowden, who had surreptitiously collected damaging proof that the NSA had taken the very technology that Binney and his team had developed and turned it inward, on the American public.

After blowing the whistle to multiple news organizations, Snowden made clear that the terrible experience of the NSA ThinThread team had led him to believe that taking his concerns to Congress would be pointless. Given the subsequent revelations by then-House Speaker Nancy Pelosi, D-Calif., and then-Senate Intelligence Committee Chairman Jay Rockefeller, D-W.Va., that they privately objected to the George W. Bush administration’s domestic spying program but did nothing to stop it, Snowden’s decision was entirely rational.

In September 2016, House Intelligence Committee Chairman Devin Nunes, R-Calif., released a three-page summary of a classified 36-page “damage assessment” on Snowden’s revelations. Although it claimed that Snowden’s disclosures had “caused tremendous damage to national security,” the committee produced no evidence that the leaks had led to the death of a single American. The committee did imply that Snowden had given American secrets to the Russians — an allegation no prosecutor involved in the case has made and not contained in the Justice Department’s indictment against him.

Most outrageously, the committee claimed that laws at the time provided protection for Snowden to blow the whistle through official channels. That’s false. Legal safeguards for contractors working for the NSA and other spy agencies existed in pilot form between 2008 and 2012. When they were up for renewal in the annual Defense Department policy bill in 2013, they were rejected — by the House Intelligence Committee.

We now live in a country where the committees charged with reining in excessive domestic spying instead too often act as apologists and attack dogs for the agencies they are charged with regulating. As a result, it’s pretty clear that those intelligence agencies — and not the elected representatives of the American people — are really running the show in Washington.

Patrick Eddington is a Policy Analyst in Homeland Security and Civil Liberties at the Cato Institute.

The Twists and Turns of the Greenback

Steve H. Hanke

At a monetary conference in Vienna back in 2014, the distinguished Frenchman, friend, and occasional collaborator Jacques de Larosière proclaimed that the current world monetary order should be termed an “anti-system.” He has a point — an important point. Among other things, such an anti-system invites an enormous amount of instability, as well as uninformed loose talk that influences public opinion and policy.

Stability might not be everything, but everything is nothing without stability.

The Chinese yuan has been at the center of much of the recent misinformation and disinformation about currencies. During the first presidential debate between Donald Trump and Hillary Clinton, Trump fingered China as the world’s best practitioner of currency devaluations — devaluations that Trump claims power China’s exports. Clinton didn’t object to Trump’s thesis. Indeed, she boarded the same train.

The facts are that Chinese exports have steadily risen since 1995, but they have not been powered by a depreciating yuan. In fact, the yuan has slightly appreciated in both nominal and real terms. The accompanying chart tells that story.

image

So, what was said about the yuan during the debate is untrue. But, that yuan story is not a debate slip. It is disinformation spread by unions, mercantilist of all stripes, and politicians: Republicans and Democrats alike.

Shortly after the first presidential debate, the yuan entered the International Monetary Fund’s Special Drawing Right (SDR) basket of top-tier currencies. With that, the Chinese boasted that the yuan was now in the same league as the other SDR currencies: USD, euro, Japanese yen, and the British pound. As part of China’s yuan promotion campaign, it declared that the yuan would be a serious challenger to the greenback as the world’s premier currency. While the yuan’s international use has grown rapidly, it started with a base of zero.

The dollar is King, and when it comes to currencies, Kings are difficult to dethrone. Even after the introduction of the euro in 1999, the USD has maintained its top spot as the currency held as official reserves, accounting for 63 percent of the total. When it comes to foreign exchange trading, the dollar is even more dominant, accounting for almost 88 percent of the turnover. Dollar notes are widely used internationally, too, with as much as two-thirds of all the greenbacks in circulation circulating overseas. In terms of the transactions handled by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), the outfit that moves “money” among banks, the U.S. dollar has increased its dominance over the past few years, accounting for almost 52 percent of the total transactions (see the accompanying chart).

image

As with the introduction of the euro, claims that the yuan will dethrone the King are off the mark. For the past three millennia, there has always been a dominant world currency, and it’s very hard to challenge the King. This is evidenced by the longevity of dominant currencies. On average, they’ve reigned for 300 years. This would suggest that the U.S. dollar, unless the U.S. government makes a big mistake or a new disruption technology enters the stage, is probably going to be on the throne a while longer. Why?

To answer that question, we borrow from the work of Nobelist Robert Mundell. In Mundell’s study of the world’s dominant currencies over the past three millennia, he found that there was always one currency that dominated, and that the following five characteristics were associated with each dominant currency:

  1. The transactions domain was large. On this score, the U.S. clearly qualifies. Until recently, it has been the world’s largest economy measured on a purchasing power parity basis. Today, its GDP accounts for 16.1 percent of the world’s total. China has recently surpassed the U.S. on that measure, with 16.9 percent of the total, and the Eurozone has 11.9 percent. So, in terms of their transaction zones, both the yuan and the euro could challenge the greenback.
  2. Monetary policy inspired confidence. No currency ever survived as a top international currency with a high rate of inflation or with a recurring risk of debasement or devaluation. So, unless there are significant U.S. monetary policy mistakes, challengers will face a Sisyphean task.
  3. Exchange controls were absent. Exchange controls, such as those in China, are always a sign of weakness, not strength. Controls alone eliminate the Chinese yuan as a challenger to the greenback’s dominance. This explains why China is working to remove controls. It is worth stressing that one of the areas where the U.S. dollar is becoming increasingly vulnerable to a challenge is the area of sanctions (read: restrictions), which the U.S. government imposes on the use of the greenback. Financial sanctions – which have been inspired by an aggressive, interventionist, neoconservative philosophy – are used by the U.S. and are administered as weapons of war by the Office of Foreign Asset Control at the U.S. Treasury (OFAC). Paradoxically, the OFAC is waging war on the U.S. dollar. Gone are the days when George Washington, in the middle of the U.S. Revolutionary War, could draw on his account at the Bank of England.

    Related to exchange controls are other types of restrictions that can be placed on how people can spend and transfer the money they own. One way to restrict the use of a modern currency is to abolish it. That is just what Harvard Professor Kenneth Rogoff has proposed in his new book The Curse of Cash, which was recently published by Princeton University Press. And Rogoff is not alone. Another Harvard Professor, former U.S. Treasury Secretary Larry Summers, and Prof. Narayana Kocherlakota, who was formerly the president of the Federal Reserve Bank of Minneapolis, have also advocated moving away from greenback cash. Such a move would open the gates for a challenge to King dollar.

  4. Strong international currencies have always been linked to strong states. States that can defend themselves against external and internal enemies. This is a security-stability factor.
  5. Until the world entered the age of complete fiat currencies, all the dominant currencies had a fallback factor. They were all convertible into gold or silver. So, today’s currencies, being fiat currencies, have no fallback factor, and all are vulnerable to a challenge. Perhaps a new disruptive technology will allow for the production and efficient use of a private currency with a fallback factor. Such a currency, if deemed to be legal, could mount a challenge to the King.

When viewing the twists and turns of the greenback in Jacque de Larosière’s anti-system, there is no better place to start than the Great Crash of 2008. The accompanying chart shows that the USD/€ exchange rate — the world’s most important price — fell a stunning 19.13 percent over a brief four month period. Linked to the soaring dollar, two other important prices, gold and oil, collapsed by 19.08 and 57.03 percent, respectively. Not surprisingly, the annual inflation rate in the U.S. moved from an alarming rate of 5.5 percent in July to an outright deflation of -1.96 percent a year later. Contrary to the Federal Reserve’s claims, the dance of the dollar and related changes in commodity prices and the level of inflation indicated that monetary policy was way too tight in late 2008. This caused massive instability that we still haven’t fully recovered from.

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What can be done to reduce the instability in the current anti-system and mitigate the damage caused by the twists and turns of King dollar? The world’s two most important currencies — the dollar and the euro — should, via formal agreement, trade in a zone ($1.20 – $1.40 to the euro, for example). The European Central Bank would be obliged to maintain this zone of stability by defending a weak dollar via dollar purchases. Likewise, the Fed would be obliged to defend a weak euro by purchasing euros. Just what would have happened under such a system (counterfactually) since the introduction of the euro in 1999 is depicted in the accompanying chart.

Stability might not be everything, but everything is nothing without stability.

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Steve H. Hanke is a professor of Applied Economics at The Johns Hopkins University in Baltimore and a Senior Fellow at the Cato Institute in Washington, D.C.

President Obama Remains in Denial about ObamaCare’s Implosion

Josh Blackman

In his ObamaCare valedictory last week, President Obama championed the law’s successes: twenty million Americans have free or subsidized insurance; sick people cannot be denied coverage; thrifty policies with spending limits are gone. His timing was impeccable, as three days later the government announced that premiums increased nationwide by an average of 25% as insurers flee the exchanges. Yet, President Obama remains in denial about the root cause of this calamity. He insists that the “problems that may have arisen from the Affordable Care Act [are] not because government is too involved in the process.” Instead, he continues to blame rising premiums, shrinking networks, and reduced choice on everything else, except the Affordable Care Act itself.

In a brief moment of candor, former President Clinton called the ACA’s collapse “the craziest thing in the world,” and lamented that people who liked their insurance have found their “premiums doubled and their coverage cut in half.” President Obama maintains a different explanation. “Insurers just set their prices too low at the outset,” he said, and when “they started losing money … now they’ve decided to significantly increase premiums.” This explanation sounds intuitive, but is extremely misleading.

Over the past three years, insurers have set their prices based on erroneous government forecasts that nearly twice as many people would enroll on the exchanges. In reality, the risk pools are dominated by older and sicker customers, with a severe shortage of younger and healthier customers. To the extent that insurers underpriced policies, the government shares the blame for overhyping the popularity of ObamaCare. Additionally, insurers were required to submit their proposals to the government for approval. Rates that were deemed too high were rejected. Here too, the government shares the blame. Unsurprisingly, a number of insurers have decided to exit the marketplace, rather than plead with the government for higher rates to sell unprofitable polices.

The President is still in denial that his signature law is unraveling our health care marketplace.

ACA defenders boast that these premium increases are largely irrelevant, because 85% of consumers on the exchanges receive subsidies to defray the costs. But this statistic paints an incomplete picture. A family of four that makes more than $100,000 a year is deemed too wealthy, and receives no subsidies. This family will likely be unable to afford any policy on the ACA exchanges, so instead will buy a policy off the exchange. By one estimate, nearly half of the consumers on the individual market receive zero subsidies. Minnesota Gov. Mark Dayton was correct in calling the Affordable Care Act “no longer affordable” for an increasingly large share of Americans.

President Obama also shirked any responsibility for those who lost the doctors they liked because their “networks have changed.” The networks of covered doctors, he insisted, are “not determined by the Affordable Care Act,” but by the insurers. This explanation is disingenuous. One of the pillars of the ACA is to push consumers into plans with smaller networks to control costs. People cannot keep the doctor they like if it is not cost effective—contrary to the President’s oft-repeated promise. Shrinking networks and consolidating care is a feature, not a bug of ObamaCare.

President Obama also dismissed the cause of spiraling copayments. “It’s not because of ObamaCare,” he claimed. Rather, “these are decisions that are made by your employers.” This response obfuscates the reality of health care economics. The ACA’s onerous and costly mandates have made health insurance more expensive. To avoid sticker shock, insurers have masked premium increased with ballooning copayments—customers now need to pay more out of pocket before receiving any benefits under ObamaCare. All of these changes were entirely foreseeable consequences of a law designed to control costs and ration care. Critically, shrinking networks and increasing copayments are not offset by subsidies.

As President Obama continues to dictate what his legacy should be, he remains in a state of surreality: he proudly takes credit for all of the people helped by the Affordable Care Act, but steadfastly blames everyone else when things go wrong. “If your premium is going up, it’s not because of ObamaCare,” he said. “It’s because of your employer or your insurer … It’s not because of any policy of the Affordable Care Act that the rates are going up.” The President is still in denial that his signature law is unraveling our health care marketplace. The fault, dear Barack, is not in our stars, but in ourselves.

Josh Blackman s a constitutional law professor at the Houston College of Law, an adjunct scholar at the Cato Institute, and the author of Unraveled: Obamacare, Religious Liberty, and Executive Power.

How Mayors, Police Unions and Cops Rig Civilian Review Boards?

Tim Lynch

As policymakers around the country wrestle with the problem of police misconduct, one suggested reform widely favored by community activists has been the civilian review board. This is puzzling because such boards have a dismal record of performance.

The idea behind civilian review boards is to have a separate, independent entity address citizen complaints of police abuse. Instead of the police department investigating itself, boards would provide external community oversight. The concept has always been appealing. Many cities embraced the model to address complaints about police harassment of racial minorities during the civil rights movement of the 1960s.

In practice, however, civilian review boards have proven to be an ineffectual check against police misconduct. The boards are commonly created in the aftermath of a police scandal, but after the photo-op announcement regarding the establishment of the new board, where politicians take credit for tackling a difficult problem, the news cycle shifts and public attention is directed to other subjects. That’s when the local power brokers in city government rig the boards to fail.

Until there is a serious commitment to maintaining professional and ethical standards in policing, the misconduct problem will fester.

Some boards, for example, are confined to reviewing the findings of the police department’s own internal affairs investigations. The trouble here is that the police can game the system by simply ignoring most citizen complaints. If the department only investigates a small fraction of complaints, the citizen review board will only review that tiny fraction. This happened in Portland, where it came to light that the police department dismissed two-thirds of the complaints it received without inquiry. Since most of the complaints were off-limits, the local review board could offer little in the way of effective oversight.

Because of the selection process for members, many boards lack true independence. The rules vary across jurisdictions, but the mayor or police chief commonly appoint a majority of the board. The rationale is that the police department has to be represented in deliberations that will affect its personnel and operations. However, those appointees are too often beholden to the very people who run the department.

When police brutality lawsuits are filed against the city, the mayor or chief may decide to contest the allegations in court. In such instances, they do not want the civilian review board to make any findings against the police officers involved. In Minneapolis, there was a legislative proposal to give the police chief veto power over board investigations in order to nip any “trouble” in the bud.

Another way power brokers have undermined the boards has been by depriving them of the funds needed to do their work properly. Without investigators and staff to dig into citizen complaints, backlogs occur. What’s more, some jurisdictions have rules in place that say if the board does not sustain a complaint within a year, the case must be dismissed. Thus, many complaints are tossed away, not because they were unfounded, but only because the board did not sustain the complaint fast enough. Chicago Mayor Rahm Emanuel had to allay funding concerns recently with his reform package. Emanuel agreed to a minimum guaranteed funding level for his newly proposed Civilian Office of Police Accountability. It remains unclear how a political compromise this year can bind Chicago mayors and council members.

Even when civilian review boards are able to investigate cases thoroughly and independently, they lack the power to impose discipline in the cases where police officers clearly abused their power. The boards can only make recommendations to the chief that certain officers ought to be disciplined. Police chiefs can then ignore the boards. In 2012, police commanders in New York City rejected board recommendations in 90 percent the cases.

Given the historical record, it is a bit odd to see civil liberties groups and community activists concerned about police abuse agitate for more citizen review boards. Such calls amount to the triumph of hope over experience. In cities where police organizations have been abusive and dysfunctional, community activists probably believe that any check on the police department has to be helpful.

Not necessarily.

Ineffectual boards can provide the local power brokers with political cover against media scrutiny and community resentment over police misconduct.

The hard truth is that police misconduct is a deep-seated problem in many of our cities. Concerned citizens should not place their hopes in a new citizen review board or a new police chief. In many jurisdictions, officials choose to placate the police unions which stymie reform efforts. Until there is a serious commitment to maintaining professional and ethical standards in policing, the misconduct problem will fester.

Tim Lynch is the director of the Cato Institute’s Project on Criminal Justice.

Experience Shows Little Impact on Safety

Angela Dills, Jeffrey Miron, and Sietse Goffard

In November 2012, Colorado and Washington approved ballot initiatives that legalized marijuana for recreational purposes under state law. Two years later, Alaska and Oregon followed suit. This November, Massachusetts will be among five additional states — along with California, Arizona, Nevada and Maine — to vote on similar measures, and four others (Florida, Arkansas, North Dakota, and Montana) will vote on whether to legalize marijuana for medical purposes.

Advocates believe that legalization reduces crime, raises revenue, lowers criminal justice expenditure, improves public health, improves traffic safety, and stimulates the economy. Critics assert that legalization spurs marijuana and other drug or alcohol use, increases crime, diminishes traffic safety, harms public health, and lowers teen educational achievement. Systematic evaluation of these claims post-legalization, however, has been limited.

In a recent policy analysis just published by the Cato Institute, we examine the impact to date of marijuana legalization and related policies in Colorado, Washington, Oregon, and Alaska.

State-level marijuana legalizations to date have been associated with at most modest changes in marijuana use and related outcomes.

Each of these four legalizations occurred recently, and each rolled out gradually over several years.

Our analysis compares the pre- and post-policy-change paths of marijuana, other drug or alcohol use, marijuana prices, crime, traffic accidents, teen educational outcomes, public health, tax revenues, criminal justice expenditures, and economic outcomes.

We conclude that state-level marijuana legalizations to date have been associated with at most modest changes in marijuana use and related outcomes.

Particularly striking is the absence of significant adverse consequences from legalization, given the sometimes dire predictions made by legalization opponents. In the aftermath of legalization, crime has not soared. Road accidents show no significant uptick. Emergency treatment center admissions remain steady. Marijuana use, while still on an upward trend, displays no acceleration. And use of harder substances actually begins to trend downwards, suggesting that the “gateway” phenomenon has not materialized.

Our analysis does not, by itself, determine whether legalization is wise policy. Ardent critics can assert that increased misuse and other unwanted side effects will boom after more time has passed; our results cannot address this assertion. Alternatively, critics sometimes argue against legalization based on ethical, religious, or moral claims, independent of measurable outcomes.

Most critics, however, have based their opposition on claims that legalization will unleash rapid and dramatic increases in marijuana use and the possible adverse consequences of that use. Our study reveals no substantial evidence that supports these strong hypotheses.

A different question is whether legalization proponents should have to prove marijuana’s safety beyond all doubt before it can become legal. The answer should be obvious: no one has ever required advocates of legal alcohol, tobacco, automobiles, downhill skiing, or triple-cream cheeses to prove beyond all doubt that these goods do not, sometimes, have serious long-term consequences. In fact, each of these, plus innumerable other goods and services, can harm those who consume them, or others, when misused.

But in a free society, the presumption must be that every good, service, action or activity is legal except when compelling evidence shows that use causes substantial harm to innocent third parties and that the costs of regulation or prohibition are smaller than those of the goods or actions themselves. Our research, like that of many others, suggests that no such case exists for marijuana.

Angela Dills is a professor of regional economic development at Western Carolina University. Sietse Goffard is an analyst at the Consumer Financial Protection Bureau and a researcher in the Economics Department at Harvard University. Jeffrey Miron is director of economic studies at the Cato Institute and director of undergraduate studies in Harvard’s Economics Department.

Michael Moore in TrumpLand Might Have Been Illegal before Citizens United?—?It’s All Incredibly Complex, and That’s One Problem with Our Campaign Finance Laws

Trevor Burrus

If you’re a politically minded filmmaker, then you should be able to freely make films, advertise them, and try to influence how people think about political issues, right? This is America, after all, and the freedom to try to influence other people’s opinions, especially on vital questions of political importance, is precisely what the First Amendment is supposed to protect. And this has to be doubly true close to an election, especially an election where so much is at stake for the future of our country. Right?

I imagine Michael Moore believes something like the foregoing. The man has dedicated his life to trying to influence the political opinions of others through film, and it would seem absurd to prohibit him from doing that or to require him to register with the government in order to speak about salient political issues. Yet, if Michael Moore’s new surprise film Michael Moore in TrumpLane is distributed in a certain way, he and his company may be required to register with the government and disclose their funding sources. And, before the Citizens United case, the film might have been forbidden entirely. It’s all very unclear, and that’s a huge part of the problem with our modern campaign finance laws.

In order to understand this, or to even get a basic grasp of the issues, we’re going to have to wade into the arcane world of campaign finance regulation, which is more confusing and surreal than you probably imagine. Bear with me.

Who Can “Influence Our Elections”?

People talk about “money” influencing our elections, but what does that mean? The New York Times has a lot of money, and they even specifically endorse candidates, so is that the kind of influence that concerns us? Or movies like Zero Dark Thirty, which is about the killing of Bin Laden and was released during the 2012 election, could be described as “money” influencing an election. After all, it cost $40 million to make, and that doesn’t include the promotion budget. Is that the type of money we’re concerned with?

While the Citizens United decision correctly made it easier for people like Michael Moore to have their opinions heard, our campaign finance laws are still a mess.

Most people would say “no,” but defining the difference between the New York Times, Zero Dark Thirty, and Michael Moore’s Fahrenheit 9/11 is more difficult than you might think. In fact, thousands of lawyers in this country are engaged in trying to figure that out and to help clients avoid run-ins with the Federal Election Commission (FEC).

Have you heard of the Supreme Court case Michael Moore v. FEC, when the Court opened up the floodgates of dark money and allowed for-profit corporations to spend unlimited amounts of money to influence our elections? No, you haven’t, because that case goes by a different name, the infamous Citizens United v. FEC. But Michael Moore and his Dog Eat Dog Films almost ended up as the catalyst for deciding the same issue that the Court would eventually resolve in Citizens United, namely, whether corporations can spend independently to advocate for or against a candidate.

Before Citizens United, corporations and unions were prohibited from independently funding political speech that was for or against candidates for federal office. This meant ads, movies, or anything else that could be considered a “broadcast.” In 2004, David N. Bossie, president of the conservative activist organization Citizens United and current deputy campaign manager for Donald Trump, filed a complaint with the FEC about the movie Fahrenheit 9/11. The ads for the movie, according to the complaint, were prohibited “electioneering communications” — meaning they clearly referred to George W. Bush, a candidate for federal office — that were illegally funded by corporate money.

Citizens United went after the ads for the movie because the ads were “broadcast,” whereas the movie itself would not be broadcast, at least as that term was generally construed. This was a crucial distinction that would be relevant in the later case of Citizens United v. FEC and is still relevant today. Campaign finance laws generally focus on communications that people might encounter accidentally, particularly television and radio ads, because those are seen as a unique threat to our electoral system.

Another complaint was also filed attacking the movie itself, its website, and its affiliated websites. The FEC dismissed the complaints against the movie, the trailers, and website because they were deemed “bona fide commercial activity” rather than campaign speech. Thus, Michael Moore avoided having to fight for his movie in higher courts.

Let’s take a step back. Campaign finance laws are premised on the idea that some types of spending on political speech that influences elections need to be monitored and regulated in order to ensure that candidate bribery isn’t occurring and that our citizens know who is funding certain ads so, presumably, they can make more informed decisions. But the very existence of such a capacious concept as “spending money to influence elections,” coupled with the First Amendment, means that certain groups and certain communications must be exempted from federal oversight. Speech that is political but not specifically election related, for example, is exempt. The press is exempt because a press that must register with the government before criticizing candidates is not a truly free press. And, finally, some entities that produce “bona fide commercial activity,” such as filmmakers, are generally exempt. Nevertheless, it is possible that certain movies could be essentially political endorsements or de facto attack ads, and then the FEC might decide that a filmmaker has gone too far.

Where’s that line? No one exactly knows.

How Can People and Organizations “Influence our Elections”?

Citizens United was emboldened by the FEC’s decision not to go after Michael Moore and Fahrenheit 9/11. As a non-profit corporation that took money from for-profit corporations, they understood the law prohibited corporations from spending independently to advocate for or against federal candidates. But the corporately-funded Fahrenheit 9/11 got a pass, and that was basically a 1.5 hour attack ad. Moreover, it was important that Fahrenheit 9/11 wasn’t broadcast to the general public and that people had to actively and purposefully travel to the theater to see it. That meant that the movie would only be “influencing” people who want to be influenced, which arguably takes it out of the FEC’s purview.

When the 2008 election rolled around and Hillary Clinton, public enemy number one in the eyes Citizens United and David Bossie, was contending for the democratic nomination, they felt they were free to make a Fahrenheit 9/11 of their own — that is, a de facto 1.5 hour attack ad funded by a corporation that was not going to be generally broadcast. So, they made Hillary: The Movie.

But the FEC disagreed. Hillary: The Movie, they said, was essentially an attack ad in a way that Fahrenheit 9/11 wasn’t. They weren’t going to get the “bona fide commercial activity” exemption or any other exemption. Moreover, even though the movie was to be on a video-on-demand service — pay-per-view — this was still a “broadcast” in a way going to a theater wasn’t. Through such subtle distinctions, the FEC determined which organizations were allowed to “influence our elections” and how they were allowed to do it. But, as I said previously, the very existence of our convoluted campaign finance laws necessitates such distinctions.

The Supreme Court Hears Citizens United v. FEC not Michael Moore v. FEC

Citizens United was understandably miffed. Why does Michael Moore get to influence elections and they couldn’t? Was there really that big of difference between Fahrenheit 9/11 and Hillary: The Movie? True, one was made by a better filmmaker and distributed broadly, but do we really think that our freedom to make political movies should hinge on how good of director you can find or how much promotional investment you can raise? That seems just silly, so they took their case to the Supreme Court.

Originally, the Court was asked to decide whether the prohibition on corporate-funded election speech was unconstitutional as applied to what Citizens United did. A video-on-demand service, after all, while technically a “broadcast,” seems hardly what the FEC should be focused on. Moreover, Citizens United argued, a movie that merely lambastes a candidate while not endorsing any other candidate is not exactly a campaign ad, it’s just basic political speech.

When the Supreme Court heard oral arguments in Citizens United, the case quickly turned into something bigger than merely how campaign finance laws apply to political movies shown on pay-per-view. It changed when Chief Justice John Roberts asked Deputy Solicitor General Malcolm Stewart if it was the government’s position that the prohibition on corporately funded campaign speech applied to books. “A 500-page book,” for example, “and at the end it says, and so vote for X, the government could ban that?” Stewart responded, “we could prohibit the publication of the book using the corporate treasury funds.”

The government’s attorney looked into the faces of the justices of the Supreme Court and said that the government could ban books. It is not surprising that the Court was somewhat taken aback. They asked for the case to be reheard, but not on the narrow question of whether there is a pay-per-view exemption to the ban on corporate spending. Instead they asked whether the entire prohibition on corporate spending violated the First Amendment. That was eventually what the Court held.

This move was controversial, and it’s still controversial today. Many people who understand the nuances of the Citizens United case believe that striking down the entire law was where the Court went wrong. Citizens United should have won, they argue, on the narrow question of whether pay-per-view videos were exempt from the law, but the Court went too far striking down the whole law.

The Chief Justice wrote separately to explain why the Court went as far as it did. Essentially, Roberts explained what I’ve written in this article: that there was no rhyme or reason anymore to which entities were allowed to influence elections and which weren’t. According to the government, Michael Moore can but Citizens United couldn’t. The New York Times (a corporation) can but other corporations couldn’t. There were so many holes and exceptions to the law organizations had been essentially reduced to asking the government for permission to criticize it, and that is contrary to the essential purpose of the First Amendment. No more narrow exceptions given to one group but not another, the whole thing must go.

Michael Moore in TrumpLand in a Post-Citizens United World

Things are simpler now, but still incredibly complex. Corporations like Citizens United and Michael Moore’s Dog Eat Dog films can now spend money on political advocacy. Yet the Citizens United decision left in place the reporting and disclosure requirements for independent political spending. Generally speaking, individuals or corporations that spend more than $250 on election speech must disclose the names and addresses of those who funded the communications. Yet it is still fuzzy what constitutes “election speech,” what’s a “broadcast,” and how to count whether something is worth $250.

We still don’t know if disclosure is triggered by using video-on-demand services, which now might include things like buying the movie over iTunes. If Moore decided to put his movie on YouTube, is that more like broadcast media or like video-on-demand? Some members of the FEC want to say it is more like broadcast media, but others are trying to keep the commission from sticking its nose too far into the internet. Asking people to consult a lawyer before posting a political rant on YouTube seems like too much.

Unfortunately, people like Michael Moore are still hamstrung by our convoluted and bizarre campaign finance laws. Moore sees Trump as a unique and dangerous threat to the United States, and he would like to influence as many people as possible with his movie. If he put it on YouTube, however, it is possible that the FEC could determine that it is essentially a corporate-funded campaign ad that is being widely broadcast to the general public. In that situation, Moore and his companies would have to register with the government and report the names and addresses of those who funded the movie. This may seem like a minor inconvenience, but the failure to report can actually have criminal penalties.

And why wouldn’t Moore want to have to register with the government and disclose who funded his movie? Well, possibly because the candidate that his movie criticizes has shown himself to be thin-skinned and litigious. As president, he could destroy the lives of those who displease him with a simple call to the IRS.

What’s certainly clear is that Moore and his company needed to consult campaign finance attorneys before distributing his film. He also presumably had his attorneys watch the film to ensure that there weren’t too many explicit endorsements to vote for specific candidates. His attorneys also likely explained that, even in the post-Citizens United world, there are many possible legal landmines and it is unclear where they are buried.

Conclusion

With the release of this new film, the Michael Moore/Citizens United saga now has a new chapter. While the Citizens United decision correctly made it easier for people like Michael Moore to have their opinions heard, our campaign finance laws are still a mess. The vague restrictions and unclear definitions can ensnare even the most casual political actor. The laws are so complex, that it is good advice to retain a lawyer before engaging in any political speech that might come close to triggering certain requirements. Even more frustratingly, there are many types of seemingly benign political speech that can trigger legal repercussions.

Thankfully, Michael Moore has enough money and enough lawyers to effectively negotiate the laws. But speaking out on political issues is becoming increasingly dangerous, and that by itself is contrary to the First Amendment.

Trevor Burrus is a Research Fellow at the Cato Institute Center for Constitutional Studies