Five Ways Trump Can Use Fed to Aid American Workers

George Selgin

On the campaign trail Donald Trump lashed out at Washington insiders for favoring policies that were “good for Wall Street … but unfair to American workers” and of diverting money “into the pockets of a handful of large corporations.” Riffing on Franklin D. Roosevelt’s famous “Forgotten Man” radio talk, he promised to make Washington answerable to America’s “forgotten men and women.”

If Trump really means it, he should take aim at one government agency that has steered boatloads of money into the pockets of large Wall Street firms: the Federal Reserve.

To make a Fed more accountable to the people than to Wall Street, President-elect Trump and his team might start with these five reforms:

Shut the Revolving Door

Let’s hope the Trump administration really cares about America’s forgotten men and women, and that it puts its monetary policy reform agenda where its mouth is.

The Fed recently announced an expansion of a one-year ban on departing employees working at a financial institution that had been under their purview at the central bank. But this policy should go much further.

As policymakers focus on the need for diversity at the regulatory agencies, the most dangerous bias in Fed appointments is one that favors former Wall Street executives. For example, ties between the industry and the central bank are illustrated in how many presidents of the Fed regional banks used to work at a huge financial services company, with several of them having worked at one firm: Goldman Sachs. Four of the presidents — William Dudley of the New York Fed, Patrick Harker of the Philadelphia Fed, Robert Kaplan of the Dallas Fed and Neel Kashkari of the Minneapolis Fed — each at one time worked for Goldman.

To let Fed appointees help craft policies affecting their former firms is just asking for trouble.

The fix is relatively easy: In addition to the one-year ban on senior and mid-level Fed employees working at a financial firm, how about a similar if not longer “cooling off” period before the Fed board or regional banks can hire a senior executive from a major firm?

End Fed Bailouts for Good

Thanks to power under the Federal Reserve Act, the Fed lent billions of dollars to cherry-picked banks in the financial crisis. But this policy was disastrous. After the Fed made a loan to help rescue Bear Stearns, other big investment banks — including Lehman Brothers — thought that they could count on the Fed to get them out of hot water. Everyone knows what happened next.

The Dodd-Frank Act tried to constrain the Fed’s powers — known as its “13(3)” authority — by limiting emergency lending to instances that were broad-based rather than institution-specific. But this provision is so vague to be toothless. As long as any authority like this remains, the chaos of the financial crisis could happen again. It’s better to repeal section 13(3) altogether. After all, the Fed already has a way for supplying emergency funds broadly, by auctioning them to the highest bidder.   

Level Playing Field for Accessing Fed Funds

The Fed’s auctions, known as “open market operations,” have traditionally been open only to a score or so of Wall Street financial firms known as “primary dealers,” forcing other firms to seek needed liquidity through private-sector channels. That arrangement usually works; but when the primary dealers themselves get into trouble it can break down. Fear of such a breakdown is what caused the Fed to turn its 13(3) spigot wide open in 2008.

The primary-dealer system is a throwback to horse-and-buggy times, when auction participants had to actually show up at the New York Fed. Today, the internet makes that unnecessary. The European Central Bank routinely allows hundreds of European banks to participate in its auctions. The Fed ought to follow its example. To make 13(3) lending unnecessary, it can also let “systematically important” (i.e., too-big-to-fail) nonbanks take part. Finally, it can offer to trade cash for a broader set of securities, as it did temporarily using its “Term Auction Facility,” and as the Bank of England now does routinely.

Stop Paying Banks to Hoard Cash

As a way to set a floor on falling interest rates, the Fed has been rewarding banks for holding on to cash since October 2008 by paying them “interest on excess reserves.” But that policy never made sense. Credit was already rapidly drying up, but IOER made it dry up even faster. Paying such interest has worked like a brake on bank lending and the economic recovery ever since.

The policy also adds to the federal deficit by reducing the Fed’s net earnings, which are government income. The Fed also pays interest to foreign banks. In fact, U.S. subsidiaries of foreign holding companies hold a disproportionate share of excess reserves at the Fed. If Trump doesn’t want Americans to foot foreign nations’ defense bills, why have them prop up foreign banks?

Subject the Fed to GAO Audits

Most of the Fed’s monetary operations are exempt from ordinary audits by the Government Accountability Office. Fed officials claim that allowing such audits would undermine the Fed’s independence. But allowing unrestricted GAO audits of the Fed doesn’t alter Congress’ constitutional Fed oversight powers at all. Instead, by supplying needed information on the Fed’s programs, the GAO could allow Congress to exercise those powers more responsibly. If this means making Fed officials answer tougher questions, that’s a benefit instead of a defect.

Other monetary reforms could also help ordinary citizens. But this list is at least a start. Let’s hope the Trump administration really cares about America’s forgotten men and women, and that it puts its monetary policy reform agenda where its mouth is.

George Selgin is director of the Center for Monetary and Financial Alternatives at the Cato Institute.

Tell the Children the Same Thing about Donald Trump as for Any President: Beware

Gene Healy

Two months before Election Day, Hillary Clinton tweeted: “the choice in this election is about who will have the power to shape our children for the next four years of their lives.” It was, I thought at the time, an insanely totalistic view of the president’s role, as well as a rotten thing to tell expectant parents, who’d spent a whole summer worried about the Zika virus.

Still, many of our fellow citizens share Clinton’s perspective, judging by the onslaught of post-election columns with titles like: “Donald Trump is our next president. What do we tell the children?” Apparently, that’s what a lot of parents are asking themselves—or their therapists—in the wake of Donald Trump’s startling victory.

Daniel Griffin, a D.C.-area psychologist, told the Washington Post that “many patients were walking into his office ‘shellshocked,’” wondering what they could possibly say to their little ones. “It never really hits you in the gut until you think about your own kids,” Will Bunch broods in the Philadelphia Inquirer, concluding that his son (age 22) and daughter (“24 and starting grad school”) were ready for the harsh truth: “Resist him.”

‘We Need to Talk about Donald’
There’s no doubt that “what do we tell the children?” is a genuinely difficult and wrenching question for some parents. Undocumented immigrants whose families face a greater risk of deportation, for example, or Muslim-Americans worried about increased fearmongering and public hostility, have good reason to think about how much their kids can handle at what age.

For most families, however, the “conversation” needn’t be so fraught with angst. It might even be the occasion for a valuable lesson: Tell your kids the truth: the president can be a bad person, even a terrible one. You don’t have to admire him if he doesn’t deserve it. And just because he’s a creep doesn’t mean it’s okay for you to be one too.

If you’re teaching your kids that the president reliably tells the truth and does the right thing, then the future citizens you’re raising may turn out gullible and easily led.

Up to a certain age, belief in Santa Claus is charming, and entirely harmless. Blind faith in presidential benevolence is neither. If you’re teaching your kids that the president reliably tells the truth and does the right thing, then the future citizens you’re raising may turn out gullible and easily led.

Why lie to them? After all, in living memory, presidents have conducted themselves abominably in their personal relationships, lied us into war, and, in former Nixon aide John Dean’s memorable phrase, “use[d] the available federal machinery to screw [their] political enemies.” Trump, who seems positively gleeful about the prospect of turning the federal machinery against his enemies, seems unlikely to set a higher standard of presidential character.

In a more innocent time, Americans raised their children to look up to the president—and they did. The political scientist Fred Greenstein interviewed hundreds of grade-schoolers for a 1960 article in the American Political Science Review, ”The Benevolent Leader: Children’s Images of Political Authority.” The children evinced “strikingly favorable” attitudes toward political leaders, especially the president.

In fact, Greenstein found it almost impossible to elicit any skepticism from the children he interviewed, despite “a variety of attempts to evoke such responses.” Far more typical were statements like “[the president] gives us freedom” and “he has the right to stop bad things before they start.”

That pattern of “juvenile idealization of the President” persisted in subsequent studies of children throughout the 1960s. Nor was it limited to juveniles: writing in 1970, presidential scholar Thomas Cronin observed that even college students’ textbooks of the era offered a comic-book vision of presidential “omnipotence” and “moralistic-benevolence.” “The student learns that the presidency is ‘the great engine of democracy,’ the ‘American people’s one authentic trumpet’?”; moreover, “if, and only if, the right man is placed in the White House, all will be well, and, somehow, whoever is in the White House is the right man.”

Putting away Childish Things
Americans grew up fast in the years that followed, however. Throughout the early 1970s, the public learned that presidents had lied about Vietnam, turned intelligence agencies against U.S. citizens, and abused their powers for political gain. Americans came to grips with the revelation that their president, our national father figure, could be a foul-mouthed, [expletive deleted] crook.

H.R. Haldeman, Nixon’s chief of staff, saw what was coming as early as 1971: warning the president about the effect of the Pentagon Papers leak:  “the implicit infallibility of presidents, which has been an accepted thing in America, is badly hurt by this, because it shows that people do things the President wants to do even though it’s wrong, and the President can be wrong.”

By the mid-’70s, even children had abandoned the childish belief in “the implicit infallibility of presidents”: subsequent surveys of grade-schoolers revealed that kids no longer viewed the president as an unambiguously benevolent leader. So too with later generations of American kids: in a 2002 study following Greenstein’s methodology, fourth through eight graders were “willing to grant importance to the office of the presidency, yet they are not willing to give unconditionally positive evaluations of the president.” The authors found “a consistent cynicism regarding the individual person of the president observable throughout all of the grade levels.”

For nearly eight years, President Obama has waged a War on Cynicism from the bully pulpit, railing against “those who question the scale of [government’s] ambitions,” and telling college students to reject the “voices” that “warn tyranny is lurking just around the corner.” Somehow, what the president decried as “cynicism” always sounded like healthy skepticism toward increased federal power. In Trump’s case, even Obama might be starting to appreciate the “cynics’?” point.

Gene Healy is a vice president at the Cato Institute and author of The Cult of the Presidency: America’s Dangerous Devotion to Executive Power.

TPP, R.I.P.?

Daniel J. Ikenson

President-elect Donald Trump has vowed to withdraw the United States from the Trans-Pacific Partnership (TPP) on his first day in office. That would be an especially excessive move, given that the TPP can have no effect, anyway, without the president’s signature affixed to legislation implementing the deal. A wiser approach would be for Mr. Trump to put the TPP on the back burner and keep open the option to reconsider it in the future, when the deal’s geostrategic imperative becomes more apparent.


Completed in 2015 after six years of rigorous negotiations, the TPP is an agreement to reduce trade and investment barriers among 12 Pacific Rim countries, including the United States. If implemented, the TPP would deliver real economic benefits to U.S. businesses, workers, consumers, and investors. Perhaps more important in a time of growing uncertainty about the direction of global affairs, the TPP would reaffirm the primacy of the rules and institutions established under U.S. leadership after World War II. That architecture provided the conditions for trade to flourish, relative peace to take hold, and unparalleled prosperity to persist for 70 years.

Indeed, the geostrategic rationale for TPP is much less about achieving overt economic and security objectives than it is about preserving—and strengthening—U.S. soft power. As the economic center of gravity shifts from West to East across the Pacific, those successful trade rules and institutions could yield to lesser, opaque, and discriminatory rules, which could become the norm in Asia without the TPP. And those rules could very well subvert the existing order, advance parochial objectives, and disadvantage U.S. commercial interests.

There could hardly be a better implement in the U.S. geostrategic toolbox than the TPP for projecting U.S. values, securing U.S. interests, and compelling China and others to play by the rules that will govern international commerce in the twenty-first century.

Ratification of the TPP is the greatest insurance policy against those outcomes. It would affirm the primacy of open trade, non-discrimination, and transparency. It would ensure that rules—and not the whims of autocrats—continue to govern global commerce, reducing uncertainty and the scope for denying U.S. entities rightful opportunities to partake of the benefits of Asia’s economic expansion in the decades ahead. In that sense, TPP implementation would extend Pax Americana deep into what has been called the Asian century.

Through eight successful rounds of multilateral trade liberalization under the auspices of the General Agreement on Tariffs and Trade between 1947 and 1994, the global economy shed the tightest shackles of protectionism. The last successful multilateral agreement—the Uruguay Round, held between 1986 and 1994—created the World Trade Organization, which enshrines the previous half century’s trade rules and serves as a beacon that guides disputes away from trade wars and toward resolution.

But in the last decade momentum for continued multilateral liberalization stalled and the ill-fated Doha Round was unofficially eulogized.

The TPP offers the last best chance to achieve a fresh round of comprehensive global trade liberalization under U.S. leadership. It reasserts the primacy of the rule of law in trade and expands its coverage to aspects of global commerce that didn’t even exist when the current rules were last updated, 22 years ago. As an agreement that includes countries on four continents and is open to new members that qualify, the TPP could evolve into a vehicle for achieving a much more broad-based round of multilateral trade liberalization.

Economies accounting for nearly 40 percent of global output and one-third of trade are among the TPP’s charter members, so the deal has achieved critical mass. That heft allows the TPP’s terms to be offered to prospective new members on a take-it-or-leave-it basis. If regional investment shifts from TPP nonmembers to TPP members, the incentive to join the agreement would only grow. Many countries, including Indonesia, South Korea, Taiwan, and Thailand, have already expressed interest in joining and have begun to undertake the domestic reforms necessary to qualify for the TPP.

With each new accession to the deal, the cost of remaining on the outside would only increase. That applies to China, too, which could watch some of its most important trade partners join TPP and, at some point, concede to having no better alternatives than to embrace the TPP, as well—and to accept the new rules that would rein in some of the abusive practices for which it is so frequently criticized.

The TPP was launched as the economic component of the Obama administration’s strategic “pivot” to Asia. There could hardly be a better implement in the U.S. geostrategic toolbox than the TPP for projecting U.S. values, securing U.S. interests, and compelling China and others to play by the rules that will govern international commerce in the twenty-first century. And there is no better way to dissuade China from bellicosity over its regional territorial disputes than to demonstrate a prosperous alternative to 1930s-style resource-driven expansionism in Asia. Rather than deploy a naval fleet, why not offer China and its neighbors a clear and plausible path to faster growth and security?

President-elect Trump has criticized free-trade agreements for being poorly negotiated. By putting the TPP on hold—rather than killing it—President Trump would buy himself some time to contemplate its geostrategic significance, as well as identify specific provisions to be renegotiated.


What Trump will come to understand is that, although failing to implement the TPP would not mean imminent regional conflagration, it would send an unmistakable message that the United States remains preoccupied and that the strategic pivot was just bluster. Suddenly anxious to remain in China’s good graces, TPP countries and others in the region would be compelled to seek closer ties with Beijing. (This is already happening, most obviously with the Philippines and Malaysia.)

Reformers in foreign governments who incurred political costs to push the TPP in their countries with expectations of U.S. participation wouldn’t soon forget who left them hanging out to dry. Any remaining expectations that the United States is still capable of leading the world to the economic liberalization it so desperately needs would erode. And with that diminished credibility, U.S. policy objectives would become more difficult or impossible to meet.

As the twenty-first century progresses, the United States will continue to exert disproportionate influence over the international order—unless it chooses to turn inward. U.S. failure to implement the TPP would serve as confirmation of such a fateful turn.

Daniel J. Ikenson is director of Cato’s Herbert A. Stiefel Center for Trade Policy Studies,

Distinguishing between Disagreement and Bigotry

Neal McCluskey

I am a Roman Catholic, and I study education for a living. Knowing that, you may think that I view the anti-Catholicism that runs through a lot of American history — much of which played out in education — as pure bigotry. You would be wrong. Having studied history, and the writings of people who feared Catholicism, I have concluded that many were not blinded by hate, but motivated by reason. I reached that conclusion by doing what we all must do: avoid the powerful, emotionally satisfying temptation to assume the worst in people, engage the substance of their arguments, and questioning my beliefs.

Roman Catholics have always been a religious minority in the United States, but what has been the majority’s deepest concern, it seems, has not been theological, but political. Catholicism, probably until the administration of John F. Kennedy, the nation’s first Catholic president, was thought synonymous with foreign power, not government by and for free people.

Lyman Beecher was a renowned Presbyterian minister who, among many things, spoke forcefully for public education, while speaking against Catholic schooling. Beecher had serious doctrinal disagreements with Catholicism, but in his 1834 tract “A Plea for the West,” he made clear that the threat he saw was political, not religious.

He wrote, “I have no fear of the Catholics, considered simply as a religious denomination, and unallied to the church and state establishments of the European governments hostile to republican institutions.”

We must stop assuming that our opponents have bad intentions, even if they seem to judge others negatively.

Beecher and others had good reason for concern. Catholic belief is grounded in the authority of Rome. And since Martin Luther posted his 95 theses, Europe had been convulsed by rulers allied with and against the Church. They battled each other and internal opponents, while Rome exerted political power.

There were bigots in America, of course, and critiques often got ugly — think Thomas Nast’s cartoon “The American River Ganges,” showing bishops rising like crocodiles from the water, threatening to eat the nation’s children. But fear that the Church might try to influence American government didn’t always come from blind hate. It just needed knowledge of history.

That said, rational concern is not synonymous with accurate perception or prescience.

While Catholics, like all immigrants, struggled to adjust to their new home, there is no evidence that they were part of any widespread effort to upend representative government. Most Catholics came to America for a better life, and a crucial part of achieving that was adopting American culture and values, including government by the people. Had more Protestants recognized that and not given into fear, and had many Catholics not assumed bigotry on the part of many Protestants, perhaps decades of painful division could have been averted.

The lesson for modern America, coming off a hyperpolarized election spawned by years of talking past — and sometimes demonizing — others, is clear: We must stop assuming that our opponents have bad intentions, even if they seem to judge others negatively. Many may be bigots, and racism and xenophobia clearly exist, but we should not default to emotionally satisfying, but unproven, accusations of bigotry that make it too easy to ignore and demean quite possibly kind, rational people. We must also accept that we are fallible, and what we believe — and feel — may be wrong.

For those who did not vote for Donald Trump — and I am one — this may mean not assuming the worst about those who oppose easy immigration from Mexico, or for Muslims. One need not be racist to conclude that if immigrants take jobs for lower pay than American citizens, immigration through Mexico — especially in violation of the nation’s laws — should be curtailed. Similarly, because many perpetrators of terrorist acts identify as Muslim, it is not self-evidently bigoted to conclude that Muslim immigration should be heavily scrutinized.

Of course, those who have concluded that immigration must be choked off must question themselves. Easy immigration — not to mention trade — drives prices of goods and services down, helping all Americans. And there is no evidence that the vast majority of Muslims in, or trying to enter, the United States want anything other than what Catholic immigrants wanted: to become peaceful, productive citizens of a free United States.

It may not be immediately satisfying, but for peace and unity we must listen to, not just label, those with whom we disagree.

Neal McCluskey is the director of the Cato Institute’s Center for Educational Freedom and maintains Cato’s Public Schooling Battle Map.

Nepotism Looms over Presidency

Ted Galen Carpenter

The high-profile presence of Donald Trump’s family in the transition team has drawn more than a few negative comments in the media. The President-elect’s son-in-law, Jared Kushner, reportedly even played a key role in undermining the prospects of New Jersey Gov. Chris Christie. The alleged motive, moreover, was Christie’s earlier prosecution of Kushner’s father for fraudulent dealings.

But the concern rose another notch when daughter Ivanka Trump (along with Kushner)reportedly attended a meeting between her father and Japanese Prime Minister Shinzo Abe. Such an incident did not seem to be just another clumsy manifestation of garden-variety nepotism, as bad as that aspect might be. Ivanka is poised to head the vast Trump business empire. Her participation in the meeting with the leader of one of America’s most important trading and investment partners constituted a flagrant conflict of interest for the President-elect.

Nepotism is nothing new in the history of the US presidency, although the Trump administration looks as though it may be especially susceptible. Perhaps the most blatant case was President John F. Kennedy’s appointment of his brother Robert to the post of attorney general. That decision so rankled the political establishment that Congress eventually passed a statute that in the future barred members of the President’s family from holding appointed posts in his or her administration. Kushner appears to be trying to find a way around that prohibition.

Nepotism is nothing new in the history of the US presidency, although the Trump administration looks as though it may be especially susceptible.

Excluding relatives from official posts, though, hardly solves the nepotism problem; even when relatives do not occupy policymaking positions, they can still have a considerable impact on policy. Informal advisers can, and throughout America’s history have, influenced occupants of the Oval Office. And those advisers often are friends or relatives.

Perhaps the toughest problem to address is the role of the presidential spouse. The post of first lady (or first gentleman, in the event of a female president) is supposed to be primarily ceremonial or dealing with noncontroversial matters. That’s an important point, because there is no provision for formal accountability, whether congressional oversight or some other mechanism, for policy initiatives undertaken by a person in that post. Yet some first ladies have exercised a substantial amount of influence over policy. Indeed, historians generally believe that Woodrow Wilson’s wife, Edith, virtually ran the presidency for the final 18 months after his debilitating stroke in October 1919.

In our own era, first lady Hillary Clinton played extremely important roles in both her husband’s domestic and foreign policy initiatives. She was so deeply involved in the design of the administration’s (ultimately unsuccessful) health care plan that wags at one Washington think tank privately derided it as “HillBilly Health Care.”

Her greatest impact, though, may have come on policy in the Balkans — in her discussions on Serbia with Bill Clinton, she later admitted, “I urged him to bomb.” The alleged episode is described by Gail Sheehy in her book “Hillary’s Choice”:

“On March 21, 1999, Hillary expressed her views by phone to the President: ‘I urged him to bomb.’ The Clintons argued the issue over the next few days. [The President expressed] what-ifs: What if bombing promoted more executions? What if it took apart the NATO alliance? Hillary responded: ‘You cannot let this go on at the end of a century that has seen the major holocaust of our time. What do we have NATO for if not to defend our way of life?’ The next day the President declared that force was necessary.”

If accurate, this would be a case of a presidential family member having not just some influence, but a decisive impact on policy. And such advice would have been offered without Clinton having had to undergo scrutiny from anyone else in a position of responsibility. Unfortunately, that type of influence is something that is extraordinarily difficult to guard against. There is no way to pass a law against presidential pillow talk, or one that bars the President from talking about a policy issue with his or her spouse or children over dinner.

The reality is that nepotism is an ever-present temptation. One would hope that both the President-elect and his family members would exercise restraint. But that would require President-elect Trump to acknowledge that the American people have elected him, not his entire family. And it would require his children and in-laws to resist the enormous temptation that comes from intimate access to the presidency and its powers.

History does not provide much confidence, though, that either the President or his family will resist the lure of nepotism. And so far, the Trump family’s conduct during the transition process inspires even less confidence.

Ted Galen Carpenter is a senior fellow at the Cato Institute and a contributing editor to The National Interest.

China’s Mining Subsidies Create Tension with Free Trade Rules

Jim Harper

If the only tool you have is a hammer, it’s tempting to treat everything as a nail. Thus, most people in the technically-oriented Bitcoin community treat the specter of mining centralization as a problem to be solved chiefly by technical means. However, a substantial cause of mining centralization is Chinese government policy, which distorts the digital currency mining market. There are creative arguments that China is violating its international trade obligations. Given the consequences for mining centralization, government subsidy for digital currency mining might be added to the list of banned activities for World Trade Organization members.

In international trade, “dumping” is a predatory pricing tactic in which manufacturers from one country export a product to another country at a price either below the price charged at home, or below its cost of production. Dumping seeks to kill off competition in the importing country, so firms in the exporting country can raise prices to supranormal levels.

Something like dumping is recognizable in the world of bitcoin mining, where the advantages Chinese firms have in chip fabrication link up with access to deeply discounted, government-provided energy to produce an unusually strong mining industry. As a result, China’s mining community has a high percentage of the world’s hash power, and miners elsewhere, such as KnCMiner in Sweden, have gone bankrupt.

Bitcoin Magazine recently reported that chip maker and miner, Bitmain, is building a major data center complex in the northwest of China to focus on Bitcoin. Its location, Xinjang, is ideal because of its cold, dry climate and “access to government-supported, low cost wind and solar electricity.”

The World Trade Organization’s Agreement on Subsidies and Countervailing Measures (SCM) details what subsidies are subject to challenge by WTO members and on what terms. Cheap, government-supplied energy is a subsidy. According to the terms of the agreement it is: (i) a financial contribution; (ii) by a government or any public body within the territory of a member; (iii) that confers a benefit.

Given the consequences for mining centralization, government subsidy for digital currency mining might be added to the list of banned activities for World Trade Organization members.

Subsidies must also be “specific.” If a subsidy is widely available, it is presumed not to distort the allocation of resources. But if a government subsidy targets particular companies, sectors of the economy, regions or exports, that subsidy runs afoul of the rules.

China’s hydropower glut almost certainly didn’t originate to bolster a bitcoin mining industry that wasn’t conceivable when the dams were built. But Chinese power subsidizes mining all the same, and it doesn’t just cause economic dislocation. It undercuts Bitcoin’s security. A blockchain system maintained by entities within a single government’s jurisdiction is at greater risk of political manipulation and censorship.

The SCM delineates two types of subsidies: prohibited and actionable. Subsidies designed to directly affect trade and thus adversely affect other WTO members are prohibited. Actionable subsidies are those that may be shown to cause adverse effects to other WTO members. When goods are at issue, subsidies can be challenged either through multilateral dispute settlement, or through countervailing action. Subsidies for services are subject to “consultations,” according to WTO rules. The Trade in Services Agreement now being hammered out in Geneva might be expanded to explicitly bar subsidies for digital currency mining, or data processing generally.

As a category buster, bitcoin and other digital currencies can be a poor fit with the traditional rules governing international trade. Anti-dumping law and the SCM apply only to trade in goods. The new bitcoins created with each block are arguably goods, even if they take digital form. The rest of the mining process is best thought of as providing transaction-inclusion services for digital currency users. When new bitcoins are no longer being created, mining will be a pure financial and data processing service.

Bitcoin transactions also don’t generally have a “location.” This means inclusion of any particular transaction on the Bitcoin blockchain is not easily proven to be a subsidized service to a consumer outside China, and Bitcoin transactions within China are subsidized to the same degree as transactions outside the country. Countervailing measures such as tariffs would be very hard to administer.

On the other hand, given the global trade and large proportion of Bitcoin transactions among users outside of China, bitcoins as goods and mining as transaction-inclusion services are clearly being provided to consumers outside China. These are exports, even though the precise place of purchase or location of service may be ambiguous.

Bitcoin’s basis in math makes the case for wrongful subsidies much easier. The power consumption bitcoin mining requires and the hash power available to various mining groups is readily calculable, so it’s quite easy to measure the substantial benefits Chinese bitcoin miners enjoy from being given cheap power.

If China were to build transmission lines that delivered energy more evenly across its economy, the argument that it was subsidizing its bitcoin mining industry would evaporate. The Chinese government may have international trade obligations that require it to withdraw the substantial benefit it now confers on its domestic bitcoin mining industry. Technological measures — such as, restraining blocksize limit, or fine tuning to reduce the amount of bandwidth it takes to propagate new blocks — are not the only tools in the Bitcoin community’s toolbox.

Jim Harper is a senior fellow at the Cato Institute, working to adapt law and policy to the information age.

Staffing Is Key to Trump’s Foreign-Policy Legacy

Doug Bandow

One of the fruits of Donald Trump’s unexpected victory is the opportunity to fill thousands of political positions. But he is preparing to become the national government’s chief executive without a deep personnel bench behind him. There is no Team Trump like Team Clinton.

However, personnel are policy. In fact, that became the mantra of the incoming Reagan administration, of which I was a part back in 1980. Unfortunately, Team Reagan often failed to act accordingly — for instance, choosing as secretary of education someone who opposed Ronald Reagan’s proposal to dismantle that bureaucracy. President-elect Donald Trump should avoid making a similar mistake.

Politico has reported that “as Trump and his aides vet nominees for his cabinet and lay out a first 100-day agenda, they are leaning heavily on the sort of DC insiders that the billionaire railed against on the campaign trail.” This could prove especially disastrous when it comes to foreign policy.

The president-elect obviously has strong, though ill-formed, opinions on foreign policy. He collected a wide variety of advisers with little unity of views. Implementing his vision will require the right personnel. While few people may hold his exact mix of views, he needs staffers who reject the promiscuous intervention that characterized both Presidents George W. Bush and Barack Obama.

Unfortunately, news reports suggest that the transition team is considering as top appointees people who hold views far different than those of Donald Trump in important areas. For instance, suggested for secretary of state are John Bolton, Kelly Ayotte, Newt Gingrich and Rudy Giuliani. All are national figures, but none shares the doubts and qualifications regularly expressed by the president-elect about today’s highly interventionist, even militaristic foreign policy.

It is especially important that the men or women at the top do not share reckless views rejected by the American people.

At least they supported the president-elect — though Ayotte rescinded her backing once the going got rough. Frankly shameless is the attempt by some of Trump’s sharpest critics to clamber aboard the unexpected bandwagon.

A number apparently have rejected the opportunity to serve, and the lack of qualified appointees could hinder his administration. Worse, however, would be to choose appointees determined to frustrate any Trump reforms. For instance, during the campaign 122 GOP-leaning national-security analysts signed a letter attacking Trump. Among them was Max Boot of the Council of Foreign Relations.

Although long allied with the Republican Party, he appeared in a Hillary Clinton campaign ad warning against allowing the business mogul near the nuclear button. Yet, the day after the election, Boot suggested that Trump could end up as a relatively conventional Republican if he staffed “his administration with competent professionals with prior government experience.” The week after the vote Boot wrote that he hoped #NeverTrumpers would overcome the temptation not to serve and “the two sides can come together.” Trump’s opponents need to “save him from himself.”

Boot is not the only former Trump recalcitrant to change positions as the possibility of high office looms. The New York Times recently ran a story headlined “‘Never Trump’ Becomes ‘Maybe Trump’ in Foreign Policy Sphere.” The Times found what it called a “softening” of opposition to working for Trump, and noted resumes from #NeverTrumpers arriving at the transition.

Politico ran a similar article, entitled “GOP national security elites agonize: Should I work for Trump?” Those who criticized him, explained Politico , now face “a gut-check moment that was never supposed to happen because Trump was never supposed to win.” However, the prospect of high office unexpectedly beckons and “is enticing.”

William Imboden, who worked for George W. Bush, author of the disastrous Iraq invasion, told the Times: “Any patriotic American who is asked to serve our country should be willing to do so and should give serious consideration to whatever position is offered.” Mary Beth Long, another former Bush appointee, explained that the GOP candidate had “matured” during the campaign, an interesting observation given the controversy generated attending his campaign up until the end.

A third former Bush official, Eliot A. Cohen, said he didn’t expect to be asked but “you never rule out something that a president asks you to do.” (But after an apparent run in with transition personnel, he flipped to counsel rejection.) Former Richard Cheney aide Eric Edelman told the Times that he wouldn’t serve, but he wouldn’t judge younger colleagues who feared being frozen out for years.

James Glassman, employed by President Bush, told Politico that he “would be proud to work” with the businessman-turned-president, who would need “top-tier, experienced people.” Danielle Pletka of the American Enterprise Institute, a leading neocon, opined that if someone serious such as Bolton were chosen as secretary of state, a number of his campaign critics “will set aside their concerns to work with somebody in whom they have confidence.” However, she said she had “no idea” as to what she would do if asked.

The motivation could be “a stated sense of patriotic duty,” noted Times reporters Mark Mazzetti, Helene Cooper and Eric Schmitt, or perhaps “a somewhat less noble motive to avoid years of being excluded from Washington power circles.” After all, for those committed to an active, warlike foreign policy, it’s not fun to remain outside of government. The last eight years already have been a long exile. To wait another four or eight years during a GOP administration — which easily might be followed by another Democratic president — could result in many wannabe grand strategists retiring without having an opportunity to initiate even a small war.

Some outsiders also are urging past critics to clamber aboard the Trump bandwagon. Emeritus professor Richard H. Kohn addressed an open letter to “Republican national security experts” who had opposed Trump. They “must serve in a Trump administration if given the opportunity” in order to remedy the president-elect’s obvious deficiencies. “You must not turn down a reasonable offer,” he argued, whatever that means. Of course, added Kohn, they should be prepared to resign if they don’t believe they can remain.

Similarly, New York Times columnist Ross Douthat said the recalcitrant had a duty to serve “precisely because they fear how Trump might govern.” That is, their duty is to neuter his administration from the start. Douthat emphasized concerns about Trump’s temperament, but for GOP uber-hawks the chief fear always has been inadequate enthusiasm for the Republican Party’s recent “bomb first” approach. While Douthat worried that Trump’s policies might threaten “world peace,” experience suggests that the latter’s Republican Party critics would be far more likely to do so.

Apparently at least some of Trump’s backers recognize the danger of including those who oppose his agenda. Before the election, adviser and retired general Michael T. Flynn reportedly criticized those who pushed America into “too many conflicts that just seem too perpetual.” House Intelligence Committee chairman Devin Nunes told the Times that it was “refreshing” that many of Trump’s critics, who never believed he would win, “are not in a position to be in the next administration.” Rep. Duncan Hunter, who backed Trump early, told Politico that “I don’t think they’re going to be bought on board, even if they wanted to,” and that “Donald Trump remembers who supported him and didn’t.”

Indeed, during the campaign, candidate Trump said, “My goal is to establish a foreign policy that will endure for several generations. That’s why I also look and have to look for talented experts with approaches and practical ideas, rather than surrounding myself with those who have perfect resumes but very little to brag about except responsibility for a long history of failed policies and continued losses at war. We have to look for new people.”

As he now prepares to fill his administration, he needs to remember that pledge.

There is much in what the president-elect said during the campaign for anyone to criticize. But he dramatically broke with the militaristic nationalists and neoconservatives who dominated GOP approaches to foreign policy in recent years. Trump criticized America’s one-sided alliances and nation building, recognized the importance of a peaceful relationship with Russia, endorsed diplomacy, almost alone among Republican candidates criticized Bush’s Iraq War, and, perhaps most notably, promised that “war and aggression” would not be his “first instinct.”

If he believes what he said, he must not staff his administration with those for whom “war and aggression” would be their first instinct. (One of the reasons many GOP hawks backed Clinton is that her first instinct always has been to send in the bombers. In fact, she has supported every U.S. war over the past two decades.)

Given Donald Trump’s eclectic view, diversity of appointments is inevitable. Which makes it more important to have top officials open to different viewpoints. It is especially important that the men or women at the top do not share reckless views rejected by the American people.

Under the current occupant of the White House, a Nobel Peace Prize winner, the United States has never been at peace. It almost certainly would not have been so under Clinton. President-elect Trump can change that, but he needs personnel who will support rather than frustrate his ends. If he succeeds, he will change U.S. foreign policy and make history.

Doug Bandow is a Senior Fellow at the Cato Institute and a former Special Assistant to President Ronald Reagan.

Why Are State Sponsors of Terrorism Receiving U.S. Taxpayer Dollars?

Christopher A. Preble

How a President Trump will approach relations with Russia — and especially what that means for U.S. policy in the Syrian civil war — has become one of the most discussed issues during a tumultuous transition. But we should be paying at least as much attention to what America’s putative partners — including those groups currently receiving U.S. taxpayer funding — are doing to prolong a brutal conflict that has claimed nearly 500 thousand lives, and driven more than ten million from their homes.

During the campaign, Trump even tangled with his running mate Mike Pence over Syria. When Pence suggested during the vice presidential debate that the United States institute a no-fly zone over Syria, Trump promptly swatted the idea away. “He and I haven’t spoken, and I disagree.” Late last week, Trump admitted that he “had an opposite view of many people regarding Syria,” and suggested that he would withdraw support for anti-Assad rebels, and focus on fighting ISIS.

Members of the GOP foreign policy establishment, however, are doubling down on the status quo.

On Tuesday, in one of the first post-election warning shots fired across Team Trump’s bow, Senator John McCain warned the president-elect not to trust “a former KGB agent who has plunged his country into tyranny, murdered his political opponents, invaded his neighbors, threatened America’s allies and attempted to undermine America’s elections.”

“At the very least, the price of another ‘reset’ would be complicity in Putin and Assad’s butchery of the Syrian people.

Alas, finding those who are “fighting tyranny” but not secretly committed to imposing it once they prevail is the tricky part.

“That is an unacceptable price for a great nation. When America has been at its greatest, it is when we have stood on the side [of] those fighting tyranny,” McCain added. “That is where we must stand again.”

Alas, finding those who are “fighting tyranny” but not secretly committed to imposing it once they prevail is the tricky part. The abundant evidence from Afghanistan, Iraq and Libya — not to mention the Cold War — shows that legitimate freedom fighters are often indistinguishable from charlatans and thugs. Despite this unhappy track record, McCain retains his childlike optimism in the United States’ ability to find the “good guys” and help them to reshape fractured foreign polities.

Few Americans are so inclined. President Obama was caught between wanting to see Bashar al-Assad’s regime overthrown, but not wanting to see violent extremists take its place, for example, Jabhat Fatah al-Sham (Conquest of Syria Front), the one-time Al Qaeda affiliate formerly known as Jabhat al-Nusra. Unsurprisingly, the president’s efforts to arm the few factions that cleared the vetting process were an abject failure, in part because the tools available to protect the U.S.-approved anti-Assad factions are deeply problematic.

A no-fly zone, for example, may forestall the complete annihilation of certain groups, but only at the risk of widening the war. Since Assad’s Russian ally is also operating from time-to-time in Syrian airspace, a no-fly zone would necessarily threaten Russian planes and pilots. And U.S. planes and pilots would also be at risk. At a meeting of the Council on Foreign Relations last month, National Intelligence Director James Clapper told CBS’s Charlie Rose, “I wouldn’t put it past them to shoot down an American aircraft.”

Some in Congress have pushed back against the executive branch’s occasional zeal for intervention in Syria. In the late summer and fall of 2013, members of Congress were flooded with phone calls urging them to block U.S. military action there. Obama got the message too, and backed away from his ill-advised red linethat would have entailed direct U.S. military action in the civil war.

But the Obama administration continued to funnel money to some anti-Assad rebels. Since then, a few in Congress have tried to cut off funds for the so-called “Syrian Train and Equip” program. An amendment to the Defense Appropriations Bill sponsored by Reps. Tulsi Gabbard (D-HI) and Austin Scott (R-GA) garnered 135 votes from both Republicans and Democrats, despite opposition from party leaders and the White House. It is reasonable to believe that a similar effort would fare even better in the post-election environment.

For now, U.S. law bars the federal government from providing support to terrorist organizations, but the United States’ putative allies and de facto clients operate under a very different set of rules. They have been fueling the civil war by plowing money and material support to a host of organizations that couldn’t survive the U.S. government’s vetting processes. In other words, other countries, some of whom are recipients of U.S. foreign assistance, are funding terrorist organizations, including ISIS. We might even call them state sponsors of terrorism. And, in any other context, that fact alone would and should disqualify them from receiving U.S. taxpayer dollars.

Christopher Preble is the vice president for defense and foreign policy studies at the Cato Institute.

The Trump Administration Will Be Hawkish

Benjamin H. Friedman

Donald Trump’s presidential transition is in transition. With Chris Christie and Mike Rogers out, Trump loyalists bickering with Republican establishment types, a purge of lobbyists,and a president-elect known for helter-skelter management, the incoming administration’s policy direction remains unclear. That’s especially true of foreign policy, the area where candidate Trump was most at odds with GOP orthodoxy.

That said, I predict, in contrast with many in Washington, that Trump’s presidency will prove conventionally hawkish. Trump is likely to jettison his vaguely non-interventionist campaign rhetoric, make nice with allies, and maintain tense relations with Russia and China. He’ll support the current wars and may start more.

That outcome would be a relief to Washington’s foreign policy establishment, which fears Trump’s isolationist tendencies and largely supported Hillary Clinton. But anyone hoping for a more restrained and peaceful foreign policy should be worried by an interventionist President Trump with the weight of U.S. military power behind him.

Trump inherits U.S. wars that span seven foreign nations and powers to start new ones at his discretion. He’ll command military forces committed by treaty to defend more than 50 nations, which requires threatening war on their behalf. Contrary to Trump’s claims that U.S. armed forces are a “disaster” and in “shambles,” they remain far superior to all others and capable of quickly delivering mass destruction virtually anywhere.

Unparalleled powers of destruction will soon pass to a novice politician famous for impetuousness, vengefulness, grandiosity, ignorance of policy basics, and contempt for intrusive facts.

Trump’s lack of experience in public office, ignorance about foreign policy, and penchant for shifting positions makes it tough to predict how he’ll manage these responsibilities. But his personality, positions, and the politics he’ll face as president-elect give reasons to doubt that his administration will take an isolationist turn away from wars and allies.

Trump is known for his self-regardimpulsivenessvindictiveness, and sensitivity to slight. That doesn’t mean he’ll treat international relations like a celebrity Twitter spat or that he would really bomb Iran because its sailors made rude gestures at ours. But Trump’s personality hardly inspires confidence that he’ll soberly navigate crises and separate the national interest from personal pique.

Nor did Trump take reliably non-interventionist positions as a candidate. Yes, he attacked Republican rivals and Hillary Clinton for supporting the Iraq and Libya wars. But Trump only opposes past wars. When those wars began, Trump was a cheerleader. He criticized nation-building but praised the Iraq surge, and suggested plundering Iraq’s oil. He sensibly criticized Clinton for wanting to depose Bashar al-Assad in Syria but supports heavier bombing.

Trump’s election also boosts the odds of war with Iran. Like most Republicans, Trump says we should withdraw from the Iran nuclear deal. That would likely further destabilize the region and put Iran back on the path to building nuclear weapons. Most Congressional Republicans would then likely advocate bombing. Trump hasn’t explicitly agreed, but his rhetoric isn’t reassuring.

Trump’s views on allies are also friendlier than they initially appear. Musing about exiting the NATO treaty or Asian alliances is certainly at odds with modern foreign policy conventions. But Trump seems to view such talk as a way to get more from allies. He essentially argued in the final debate that unconditional support for allies leaves you without leverage over them. Trump also seems likely to accept minor increases in allied efforts. His false claim that NATO changed counterterrorism policies because of his critique is suggestive. He may be less interested in  squeezing the maximum out of allies than in shows of deference and praise for his deal-making prowess.

But what sort of hawk will President Trump be? One possibility is the Republican establishment socializes Trump. That wouldn’t affect Trump’s stances on Iran and ISIL but would mean getting tougher, not friendlier, with Russia and China, while keeping current alliance commitments. The other possibility is that Trump remains at odds with the establishment and sets a Jacksonian course. That means hostility to international cooperation, including alliance commitments, pragmatic dealings with big rivals, and willingness to attack weaker states and Islamist insurgents.

The second possibility sounds more like the guy we saw during the campaign. Still, I bet that the power of the status quo will make Trump into more of an establishment hawk. Keep in mind that something similar occurred with Presidents Bush and Obama. As a candidate, George W. Bush was skeptical about nation-building. After the September 11 attacks generated broad support for wars and subsequent nation-building efforts, he became their champion. Obama campaigned on his opposition to the Iraq War before retaining most of Bush’s security policies, including the scheduled withdrawal of U.S. forces from Iraq, while expanding the war in Afghanistan and drone strikes. Though Obama became a critic of the foreign policy establishment’s “playbook,” he struggled to escape its conventions.

Three factors constrain presidents from ditching established foreign policy. The first is the continuous nature of policy. Policies outlast those that make them. So do the agencies that execute policies. Diplomats, military officers, and civil servants ensure that commitments endure. With concerted effort, presidents can buck the bureaucracy, but that takes focus that Trump seems to lack. His disinterest in policy detail and inexperience suggest that he’ll manage loosely and rely on aides.

Appointees to foreign policy posts are a second constraint. With limited time and thousands of spots to fill, presidents naturally turn to the foreign policy establishment housed in think tanks, law firms, and consultancies. These experts,  who are highly interventionist and pro- alliance, regardless of party, gain considerable sway, especially when the president is inexperienced and focused elsewhere. Trump increasingly relied on Washington insiders as his campaign advanced. His defense proposals reflect that. It would be difficult for Trump to find enough non-interventionist experts to fill key security posts, if he were inclined to try. And if rumors about likely appointees are even part right, he isn’t. No one among Rudy Giuliani, Michael Mukasey, Jeff Sessions, Duncan Hunter, Jim Talent, and John Bolton seems likely to favor a turn away from military interventions and alliance commitments.

Finally, there’s Congress, whose members naturally defend policies that they helped make. Ideally, Trump’s election would alarm legislators into constraining his war-making powers. But the Republican majority didn’t do that even with a Democratic president fond of unauthorized bombing campaigns. They instead criticized his passivity. The incoming Congress will press Trump to maintain present alliances and wars, or worse.

Public opinion is a potentially countervailing factor. The American electorate is consistently more skeptical of wars and military hegemony than elites, and its appetite for war remains limited. Still, the publicincluding Trump voters, is supportive of allies and aggressive efforts to combat ISIL. Moreover, security issues typically lack electoral importance because their direct consequences for voters are limited. Leaders can usually buck public opinion without losing votes. Public opinion then constrains Trump’s hawkish moves only if he anticipates high costs.

U.S. institutions — the Electoral College and an increasingly unconstrained presidency — have produced exceptionaldanger. Unparalleled powers of destruction will soon pass to a novice politician famous for impetuousness, vengefulness, grandiosity, ignorance of policy basics, and contempt for intrusive facts. His rhetoric about wars during the campaign was flippant and bellicose. Checking presidential war powers should now be a bipartisan fixation. But by adopting more conventionally-hawkish views and placating Republican leaders, Trump may avoid restraint.

Benjamin H. Friedman is a research fellow in defense and homeland security studies at the Cato Institute.

Why the Left and the Right Should Oppose Government Registries

Adam Bates and Alex Nowrasteh

During his campaign, President-elect Trump’s most consistent policy position was support for harsh immigration enforcement policies, including mass deportation of unlawful immigrants. Troublingly, government identity databases created for other purposes, many of them noble, could significantly increase the effectiveness of a Trump deportation scheme. The frightening specter of the federal government using applications for Deferred Action for Childhood Arrivals to target young unlawful immigrants would be a humanitarian and economic disaster.

President Obama’s 2012 DACA executive order granted a temporary renewable work permit and protection from deportation to some unlawful immigrants brought here as children. About 665,000 signed up for it, allowing them to work legally for the first time in their lives. The problem, however, is that this executive action could be overturned by the next president.

Government registries of vulnerable communities are always only one election away from being abused.

Trump has promised to do that on his first day.

Ending DACA is bad enough. The bigger danger is that these unlawful immigrants had to give their names, addresses and other personal information to the federal government in order to obtain DACA in the first place. The government will still have all of that identity information even if DACA is repealed. The personal information of DACA recipients solves the hardest problem of deporting illegal immigrants: Identifying and finding them.

About 850,000 New Yorkers have the city’s IDNYC card. Most of them are unlawful immigrants. The card was supposed to make working and living in the city easier, but it also centralized the addresses, names and other information of many unlawful immigrants in an encrypted NYC database. New York Mayor Bill de Blasio suggested the day after Trump’s election the database could be “scrubbed” to protect the individuals in it.

What is he waiting for?

This should produce deja vu. Politically unpopular and minority communities have long had good reason to fear government registration efforts. In the 1950s, the state of Alabama tried to force the NAACP to turn its membership lists over to the government. The NAACP refused, and eventually won in the Supreme Court. The court cited “the vital relationship between freedom to associate and privacy in one’s associations,” when it ruled that revealing the NAACP’s membership lists would impermissibly infringe on the members’ constitutional rights.

The war on terror has created similar registration fears in the Muslim community, which has been subjected to extensive surveillance and data basing efforts. A spokesman for Trump’s super PAC actually claimed Wednesday there is a “precedent” for a registry of Muslim immigrants, referencing Japanese-American internment camps. More recently, due-process-free no-fly lists and a fruitless effort to “map” the New York Muslim community have harmed them most of all, but others have also been affected, including the late Sen. Ted Kennedy, D-Mass.

Americans are added to these lists by government “nominators.” Those added do not receive a hearing, access to evidence or the opportunity to challenge their accusers. It is, in short, simply a registry of (predominantly Muslim) Americans according to the whims of government bureaucrats. This list could be used to enforce laws that wreak havoc on civil liberties but haven’t been written yet.

Earlier this year, gun control advocates and national security hawks attempted to ban anyone on the no-fly list from buying firearms. The effort failed, but the rhetorical push for it was intense. Sen. Joe Manchin, D-W.Va., even declared that affording due process to people on the registry was “killing us.”

Gun rights advocates have pushed against registries longer and harder than any other group. A national database of gun owners is the deepest line in the sand for 2nd Amendment advocates. Such a registry would be a necessary prerequisite of a potential national confiscation program like the one used in Australia in the 1990s. The lack of a registry is a necessary precaution because it dooms confiscation to failure.

Supporters of gun control routinely disclaim any interest in the creation of such a registry and current federal law forbids such registries, though the government sometimes cheats. Many common gun control proposals, such as universal background checks, can’t function without a registry. If the government doesn’t know who owns which guns initially, it can’t prove whether illegal exchanges have occurred.

Gun rights advocates are often mocked for fearing the misuse of registry information. “Nobody is coming for your guns,” they say. “What are you so afraid of?”

We’re afraid of the same things the DACA recipients are now afraid of, and what prompted de Blasio to suggest scrubbing government databases.

The mere possibility of this threat should be a rebuttal to all those who mock the paranoia of gun-registration advocates. Government registries of vulnerable communities are always only one election away from being abused.

Ideally, these registries wouldn’t exist in the first place. Insofar as they do, they should be destroyed.

Adam Bates is a policy analyst with the Cato Institute’s Project on Criminal Justice. Alex Nowrasteh is the immigration policy analyst at Cato’s Center for Global Liberty and Prosperity.