Corbyn’s Easy Answer to UK High Rents Is No Answer at All

Ryan Bourne

President Ronald Reagan once said: “There are no easy
answers, but there are simple answers.” In his Labour Party
conference speech, Jeremy Corbyn instead proposed easy answers to
Britain’s rent affordability crisis that were simply
wrong.

Corbyn’s commitment to reintroduce rent controls in the
private rental sector would either be highly damaging or else have
trivial consequences. Without detail, we do not know which. Either
way, he is promising false hope that a solution is just one
government price-control away.

Rent control is one of the most intensely researched areas in
economics, and a rare consensus has emerged that rent caps are
highly damaging. A whopping 95pc of economists in an IGM Chicago
Survey opposed the idea, for example, that rent control in New York
and San Francisco had improved the amount or quality of highly
affordable accommodation.

It’s widely acknowledged
that rent control can also have substantial negative effects on the
quality of accommodation.

Now, perhaps replicating these cities is not what Corbyn has in
mind. So let’s give him the benefit of the doubt and examine
two scenarios.

First, let’s suppose Corbyn was really serious about
willing rents lower, and granted powers to councils to hold private
rents below market rates. This could be an explicit rent cap, or
might be like the old UK “Fair Rent” regime, whereby
councils set rents on the physical characteristics of the property,
but could not account for relative scarcity or demand in the
area.

Holding rents low in an area of already relative scarcity would
merely exacerbate that scarcity, because it deters the provision of
new rentable accommodation. Fix prices below market rates, and you
discourage new supply.

This is not just some theoretical insight. In the UK’s
rent control period, the share of private rented accommodation in
total all-tenure supply fell from nearly 80pc in 1918 to 10pc
around 1989, only rebounding somewhat following rent deregulation
that year. But Britain isn’t alone in this. Vienna,
Massachusetts, and Israel have all, in the past, seen similar
effects. As a striking example, between 1906 and 1946 in San
Francisco under rent control, the ratio of listings in the San
Francisco Chronicle between houses for sale and rentable
accommodation available increased from 3-to-10 to 730-to-10.

It’s widely acknowledged that rent control can also have
substantial negative effects on the quality of accommodation. It
produces an incentive for landlords to encourage tenants to leave,
souring tenant-landlord relations, so that accommodation can be
repurposed. But even for landlords who stick it out, low rent
discourages maintenance such that the quality of the accommodation
falls to reflect the lower rental price.

In New York’s old style rent control, for example,
economists found that there was almost a 9pc higher probability of
an older or smaller building being in unsound condition in
Manhattan if it was rent-controlled. Here in the UK, by 1982 18pc
of rentable accommodation was defined as unfit and needing repair.
Meanwhile, OECD work has found that countries with more restrictive
rent controls have higher proportions of tenants living in homes
with leaky roofs.

But wouldn’t poorer tenants benefit from the lower rents,
you ask? Well, potentially, but it really depends on how the
properties are allocated. The absence of proper price signals means
allocation by queuing or search intensity, wasting resources and
time. In Stockholm, the average wait time to get a contract is nine
years, but can be as high as 20 in some areas. Unsurprisingly,
contracts trade at double the rent-controlled price on black
markets.

For all these reasons, crude rent controls are widely considered
a disaster. Some have suggested instead that Labour might introduce
less-damaging “tenancy rent controls”. This would, in
effect, be a new form of contract, maybe a three-year tenancy,
whereby rent rises are capped at inflation within that fixed
period, but able to vary between tenancies.

Under this framework, rents would adjust to changing market
trends in the medium term, negating the stark consequences of
cruder controls. Even so, there would be some real damage on the
margin. Landlords would bear much more of the risk of vacancies and
changing market prices, likely deterring investment. And again the
incentive will be to only undertake substantial unforeseen
maintenance needs between tenancies, when they can reflect their
investment into new rental prices.

The key point about this form of rent regulation though is that
there’s no way it will solve the problem outlined by Corbyn:
high rents. Sure, it gives a degree of security to tenants against
“economic eviction” — unforeseen large jumps in
rent. But landlords will simply forecast likely market trends,
pricing in their expectations, and will front-load rents to reflect
these forecasts.

As such, Corbyn is presenting a solution that is bound not to
solve the underlying problem. If he opts for crude rent controls,
he will worsen availability and cause substantial economic damage.
If he opts for fancy new rent regulation, he will not reduce market
rents. The simple long-term answer is: more supply, more supply,
more supply. The easy answer Corbyn outlines, to blame landlords
and will the problem away, is no answer at all.

Ryan Bourne
holds the R Evan Scharf Chair for the Public Understanding of
Economics at the Cato Institute.

‘Direct Care’ Could Help Ease Medical Costs

Jeffrey A. Singer

As a general surgeon I see patients every day who’ve had
batteries of preventive and screening tests that, after all is said
and done, yield nothing more than increased spending and increased
anxiety. Many doctors are unconcerned with the cost/benefit aspects
of the treatments or tests they offer, and often abandon taking a
detailed medical history and performing an extensive physical exam
— instead they rely on costly imaging studies to do the heavy
lifting.

I blame the third-party payer system.

The healthcare consumer pays only 10 percent of every healthcare
dollar directly out of pocket. The third party — either an
insurance company or Medicare — pays the rest. With Medicaid
the government is the third party and pays 100 percent of every
dollar.

Many of the cost drivers in healthcare today are symptoms of
this third-party payer system. When somebody else is paying the
bill, it’s easy for doctors and patients both to forget about the
cost-effectiveness of medical diagnostics and treatments.

When somebody else is
paying the bill, it’s easy for doctors and patients both to forget
about the cost-effectiveness of medical diagnostics and
treatments.

Over-diagnosis and over-treatment in healthcare are well
documented. They are part of the reason healthcare spending has
increased as a share of Gross Domestic Product from 5 percent in
1960 to over 17.8 percent in 2015. According to a 2010 report from
the Institute of Medicine, they may be responsible for over 15
percent of healthcare spending.

Many blame over-testing and over-treating on “defensive
medicine,” i.e., practicing in fear of getting sued. But the
evidence does not support that hypothesis. In fact, many studies
suggest that major tort reform has no impact on healthcare spending
and, if anything, might lead to a slight increase in spending.

Patients are also a part of this healthcare culture. For
example, a 2012 analysis of 14 large studies by the RAND Corp.
found annual physicals for healthy adults don’t lower the risk of
serious illness. Yet millions get them, and this is not helped by
the fact that the Affordable Care Act mandates insurance companies
pay for an annual wellness exam at no out-of-pocket expense to the
patient. The cost/benefit relationships of numerous other
preventive measures have also come into question.

People every day consider cost/benefit when they purchase
shelter, food, cars, computers, smartphones, etc. They ask detailed
questions and expect satisfactory answers. Not so when it comes to
healthcare decisions. The public uncritically accepts screening,
early detection and early treatment as always worthwhile.

The public also accepts that having insurance is a critical part
of staying healthy. Yet insurance is supposed to protect against
unforeseen, high-cost, catastrophic events. As a result of years of
tax and regulatory policy, health insurance has morphed into a form
of prepaid healthcare, covering predictable, foreseen, pre-existing
and routine “maintenance” events in addition to the catastrophic
and unforeseen. Hospitals, labs, pharmacies and providers negotiate
fees with a third-party payer, not the consumer. Consumers are left
out of the loop, along with consumer-driven market forces.

The third party has deeper pockets than any consumer. That’s why
providers reflexively seek approval from third-party payers for new
and innovative services before considering the approval of the
actual consumers of those services.

Those taking part in the third-party payment healthcare system
are not crooks. They are rational beings, responding to rules and
incentives that have been in place for generations. Healthcare
providers, hospital administrators and patients have been
conditioned — acculturated — to play the game according
to these rules.

There is a healthcare community that is not a part of this
culture. It exists in a setting with minimal or no third-party
involvement. In service areas such as LASIK eye surgery, cosmetic
surgery, dental implants and cosmetic dentistry, and many general
dentistry practices, providers compete for the patients’ business:
in price, quality, service and accountability. Patients shop and
ask detailed questions. Competition drives prices down and quality
up.

“Direct care” is a growing sector in healthcare offering primary
and specialized care, and even surgical hospital care, directly to
consumers for direct payment, absent a third party. More and more
providers are migrating to direct care from the third-party model.
Many others avail themselves of its cousin, the Health Care Sharing
Ministries. A 2014 Physicians Foundation Survey found 7 percent of
physicians were already doing direct care or “concierge” medicine;
13 percent said they were planning to make the move; and 17 percent
of doctors under age 45 plan to do so.

“Medical tourism,” another form of direct care is on the rise.
Consumers travel offshore, often considerable distances, to
purchase high-quality, sophisticated medical and surgical
treatments at very affordable cash prices. Firms and websites help
consumers shop and connect with these medical centers.

America’s healthcare system suffers from dysfunction and
dysphoria and is in cultural decline. Its last best hope may be
this counterculture called “direct care.”

Jeffrey A.
Singer
practices general surgery in Phoenix, Ariz., and is a
senior fellow at the Cato Institute.

On Judicial Nominees, Trump Just Keeps on #Winning

Ilya Shapiro

President Trump hit another judicial home run with his 5th
Circuit nominees today. Don Willett and Jim Ho are tremendously
experienced and qualified lawyers and public servants whose
intellect and legal skills are matched only by their integrity and
commitment to the rule of law. I have known them both for a long
time and can attest that they will be tremendous assets to the
federal judiciary.

Justice Willett’s nomination in particular will make national
headlines because of his presence of social media. A decade from
now it probably (hopefully!) won’t be unusual to find federal
judges tweeting about life, the universe, and everything —
but in 2017, Willett is a trailblazer.

Whatever else is going on
in the world, this administration’s judicial appointments are on
the right track.

Not that he’s snarky or glib or anything that Twitter is known
for. Instead, he’s become the judicial Twitter laureate because of
the education he gives his fellow citizens on the Constitution and
the proper role of a judge (and bacon) all in his own inimitable
“judge next door” style. It’s to the enduring credit of the White
House counsel’s office and Justice Department that someone who’s
not plain-vanilla made it through the vetting process.

Not that Willett is all hat, no cattle. His work on the Texas
Supreme Court has become known for his clear writing style and
unwillingness to let the government, especially the Texas
government, slide if it’s exceeding its powers or intruding on
constitutional rights. It’s no wonder that he made the Supreme
Court shortlist for the seat that Justice Neil Gorsuch now
occupies, nor that he’s become a favorite of conservative (and
libertarian) elites and Texas lawyers alike.

Jim Ho has also made a reputation as someone committed to
originalism and textualism, having graduated with honors from the
University of Chicago Law School (my alma mater), clerked for
Justice Clarence Thomas, built on Ted Cruz’s success as Texas
solicitor general, and established his own nationally renowned
appellate practice at Gibson Dunn in Dallas. He’s truly a rising
star.

An additional winner from this announcement is Cruz himself.
Both Willett and Ho are longtime friends of his and the fact that
the junior senator from the Lone Star state was able to prevail in
the Texas battle royale that delayed the filling of these two seats
speaks volumes about the continued influence he has regarding
constitutional issues and the future of the conservative legal
movement.

In short, I offer a double-barrel salute to President Trump and
his legal advisers on this one. Whatever else is going on in the
world, this administration’s judicial appointments are on the right
track.

Ilya Shapiro
is a senior fellow in constitutional studies and editor-in-chief of
the Cato Supreme Court Review.

Feds, Wasting Time on Facebook

Alex Nowrasteh

In the annals of the Federal Register, the Department of
Homeland Security just published a scary new rule. It requires
immigrants to hand over “social media handles, aliases,
associated identifiable information and search results” as
part of the visa-vetting process.

Slated to go into effect Oct. 18, and applying to permanent
residents and naturalized citizens as well , this rule is intended
to weed out people whose social media activity reveals they are
national security threats.

Unfortunately, despite the Trump administration crowing about
the importance of “extreme vetting” of newcomers, the
new rule will just make immigration a more convoluted process,
while doing little to protect Americans from terrorism.

Much of the impetus for searching social media accounts, such as
Twitter and Facebook, comes from a myth about the Dec. 2, 2015,
terrorist attack in San Bernardino, Calif., in which Pakistani-born
Tashfeen Malik and her U.S.-born husband murdered 14 people.

Before coming to America, Malik was rumored to have publicly
posted on her social media accounts that she supported violent
jihad.

If the government discovered those posts, supporters of the new
Homeland Security Department rule argue, many lives could have been
saved.

Only that’s not what happened. After the rumors started to
swirl, then-FBI Director James Comey noted that, “Those
communications are direct, private messages … we have found no
evidence of posting on social media by either of them …
reflecting their commitment to jihad or to martyrdom.”

And no other jihadi terrorists who targeted U.S. soil have
publicized their radical intent online prior to an attack , as far
as we know. Little wonder why not — it would be supremely
stupid.

The “underwear bomber” (Umar Farouk Abdulmutallab)
did post jihad-supportive statements in Islamic chat rooms using a
pseudonym, but that is not a social media handle. Convicted
terrorist Mohamed El Hassan posted, under a pseudonym, at least one
YouTube comment supporting a radical preacher.

If wannabe terrorists post online, they use a pseudonym.
Accessing immigrants’ legitimate social media handle
won’t expose terrorists-in-waiting.

Introducing more ideological thought crimes into the immigration
process will just place more power in the hands of unaccountable
bureaucrats and won’t improve security.

Comey’s comments and the facts about terrorists posting on
social media were too late to stop 25 U.S. senators from writing a
letter to the Homeland Security Department in 2015 requesting the
agency look into screening social media accounts.

But a 2016 pilot program to do exactly that proved so
ineffective that Homeland Security determined that an immigration
agent would have to manually check each immigrant’s social
media account.

All of which is why it’s highly unlikely this new rule
will prove successful from a security standpoint. Indeed, the
social-media-vetting program proposed by the Trump administration
was tested on a group of refugees who were rejected for national
security reasons — and it found zero evidence of ties to
terrorist groups or any other threat to national security.

The fact is, normal immigrant vetting is already so thorough
that a social media check is unable to increase security. As for
refugees, they’re already subject to the most intense
visa-vetting of any immigrant or visitor category.

Besides, authorities already have access to this information.
Prosecutors and attorneys already introduce social media posts as
evidence in immigration courts.

Immigration attorney Greg Siskind told me that,
“We’ve heard anecdotally for years about how
immigration examiners will look at social media and scour the
internet when adjudicating a case, and I’ve told clients to
assume that their online history is being reviewed.”

Mining social media posts as evidence for a specific claim is
easier and more likely to succeed than fishing expeditions for
posts that show an intent to violate national security.

As a broad policy matter across the federal government, the
Trump administration has promised to remove two regulations for
each new one introduced. However, it has made an exception in the
immigration system, where the rules and regulations — each of
them costing time and money — keep piling up.

For example, the government increased the length of the green
card adjustment-of-status form to 18 pages, up from six, while
doubling the length of many other applications.

This new proposed rule, whose rationale is rooted in fake news,
will waste many man-hours and delay visa-processing to legitimate
immigrants for no apparent gain in security. The Trump
administration should scuttle it now.

Alex
Nowrasteh
is an immigration policy analyst at the Cato
Institute.

An Outdated Protectionist Law Is Hurting Puerto Rico

Michael D. Tanner

If anyone wants more evidence of how protectionism hurts the
poor and most vulnerable among us, Puerto Rico now offers a prime
example.

The island was devastated by Hurricane Maria. Tens of thousands
have been left homeless. Basic goods and services, such as food,
water, and fuel, are in short supply. Electricity is out for
virtually the entire island, and may not be restored in some places
for months. Nearly 85 percent of the island has no cell-phone
coverage. Much of the country’s already-shaky economic base,
including tourism and agriculture, has been all but wiped out.

Yet despite the unfolding humanitarian crisis, the Trump
administration has so far refused to waive the law’s
restrictions.[/pullquotre]

Yet vital aid to the island is being slowed by the Jones Act, a
100-year-old example of protectionism and corporate welfare. The
Jones Act requires that all cargo shipped to Puerto Rico is carried
on ships built entirely in the United States, owned by a U.S.
citizen, flying a U.S. flag, and staffed by a majority-American
crew. Relatively few ships meet those requirements. And at a time
when even a brief delay in getting assistance to suffering
islanders could cost lives, the Jones Act is an unneeded impediment
to that aid.

Yet despite the unfolding humanitarian crisis, the Trump
administration has so far refused to waive the law’s
restrictions.

Over the years, the Jones Act has been larded with all sorts of
national-security justifications, but its real purpose is to
protect jobs in the U.S. shipbuilding and merchant-marine
industries. No doubt those are good jobs, though the number of
people employed in shipbuilding has fallen by 40 percent since
1980. But like most protectionist measures, this law ends up doing
far more harm than good. And those most likely to be hurt are those
who can least afford it.

This is not just true of the Jones Act, but of protectionism
generally. For example, economists estimate that trade and the
availability of low-cost imported goods improves the purchasing
power of middle- and upper-income Americans by roughly 29 percent.
But trade increases the purchasing power of the poor by more than
62 percent. At the same time, the Peterson Institute for
International Economics estimates that past gains from U.S. trade
and liberalization of investment range from $9,270 to $16,842 per
household. Another study found that that “a 1 percent increase in
trade raises real income by 0.5 percent.” That might not seem like
a huge boost for the wealthy — the global elite, to use the
pejorative preferred by protectionists — but it makes a big
difference in the lives of the poor.

For now, the bigger debate over protectionism can wait.
Suspending the Jones Act for the duration of Puerto Rico’s recovery
should be a no-brainer. Better yet, let’s repeal this antiquated
example of special-interest protectionism. And let’s begin to
understand that there is a very real price to be paid for all
special-interest protections.

Michael
Tanner
is a senior fellow at the Cato Institute and the author
of Going for Broke: Deficits, Debt, and the Entitlement
Crisis.

The Glee over the Uber Ban Reveals How Corbyn’s Economic Policy Would Work

Ryan Bourne

On Uber, reactions speak louder than words. Set aside for a
moment the issue of Uber’s compliance with the Transport for London (TfL) rules, and whether revoking
their licence was justified or proportionate.

The celebratory tone of the supposed “labour
movement” to news that 40,000 contractors will see their main
source of income effectively banned (a higher number than employed
in the much-discussed steel industry) was far more eye-opening, and
should lead many to question the hard left’s true concern for
“workers”.

In fact, this whole episode has offered a revealing insight into
how a Corbyn-governed Britain might operate when it comes to
business and the labour market.

The willingness to revoke
licenses and stop businesses operating at short notice creates
substantial uncertainty, deterring investment and
innovation.

First, there’s the obvious: the unions running riot.
Delirious from this “victory”, the general secretary of
the Trade Union Congress, Frances O’Grady, tweeted
chillingly: “Firms have a choice. Sit down with us and work
out a fair deal for workers. Or end up in court and all over the
front pages. #Uber”.

Never mind that Britain has a labour market with low levels of
unemployment and a high number of vacancies — suggesting
workers have market power and choices available. Under a Corbyn
government, emboldened unions would use their bullying tactics to
narrow that choice to firms where they consider strong
“rights” available, no doubt shaped by existing models
of employment.

In other words, in truly Orwellian double-speak, we’ll see
unions who purport to care about workers’ rights —
apart from the right to work for the company you want to.

Second, there’s the complete disregard for consumers.

Perhaps I’ve missed it, but I’ve yet to hear one
Labour supporter of the TfL decision acknowledge that it could have
a downside for the public who actually regularly need to get around
London.

While most economists would weigh up the impact of any
intervention using a cost and benefit analysis, including the
impact on prices and availability for customers, the Corbynistas
only seem to see things through the lens of the incumbent
producers. Hence the obsession with “stopping undercutting of
workers”.

This would no doubt permeate other aspects of their economic
programme, with more in the way of protectionism for beleaguered
industries on arbitrary “quality” grounds, and an
opposition to expansive liberalising trade deals. The result?
Higher prices, and a less dynamic economy.

Third, there’s the reach for the nationalisation of
everything. In the aftermath of the Uber decision, some Corbynistas
are already urging TfL to create what is in effect a
publicly-owned, or “mutually-owned, publicly-backed”,
version of Uber called “Khan’s Cars” — a
play on the “Boris bike” scheme. Talk about reinventing
the wheel (or, rather, the app).

Far from viewing the role of government as to supply only what
cannot be provided efficiently by the market, these guys reach for
the state as the first resort for provision.

And to what end? Uber was innovatively providing its service
cheaply to Londoners, with some critics even claiming it was
subsidising journeys to encourage use. So either a publicly-owned
scheme would be more expensive for consumers, or else it would
instead be subsidised by taxpayers — increasing the tax
burden further for no good reason beyond an ideological pet
project. Wasteful spending would proliferate.

Fourth, and perhaps most worrying, is the arbitrary nature of
the views held by Corbynistas about why Uber shouldn’t be
able to operate, and what this would therefore mean for the role of
government.

TfL had specific concerns (at least in the public reasoning for
its decision) about Uber’s reporting of criminal offences and
the use of its controversial “Greyball” technology.

But others have since thrown in other gripes, egged-on by the
black cab trade, for why Uber should be banned — from its
role increasing congestion, to its contractor model and tax
structure. The well-connected Corbynista journalist Paul Mason even
tweeted that Uber “erodes social capital” as an
apparent reason to oppose its existence.

This arbitrary, rather than rules-based, decision-making leads
both to emboldened vested interests (in this case, the black cab
trade, which played on Labour gripes with Uber in their
campaigning), and businesses second-guessing the ideological
preferences of the government.

The willingness to revoke licenses and stop businesses operating
at short notice creates substantial uncertainty, deterring
investment and innovation.

But worse is the longer term consequence for remaining firms.
Rather than spending time meeting the wants and needs of customers,
companies would essentially become lapdogs to the Labour agenda
— getting treats and tax breaks when they did something
“progressive”, and the newspaper to the nose when they
did not.

This is the ideal world, according to the anti-Uber
Corbynistas.

Ryan Bourne
occupies the R Evan Scharf Chair in the Public Understanding of
Economics at the Cato Institute in Washington DC.

The New Electronic Police State

Matthew Feeney

According to the government, your privacy protections evaporate
the moment you set foot in an airport.

Although the Fourth Amendment protects us and our
“effects” from “unreasonable searches and
seizures,” Customs and Border Protection agents can take
advantage of an exception to this constitutional protection and
search our electronic devices at airports without first
establishing reasonable suspicion or securing a warrant.

According to the
government, your privacy protections evaporate the moment you set
foot in an airport.

It’s a problem that’s only getting worse. Last week
the American Civil Liberties Union and the Electronic Frontier
Foundation entered into a suit on behalf of eleven travelers

against the Department of Homeland Security
. The plaintiffs
claim that warrantless and suspicionless border electronic device
searches violate the First and Fourth Amendments.

They’re absolutely right. CBP agents are gaining access to
massive troves of personal information related to law-abiding
Americans. This exception is an affront to everyone’s privacy
and must be revoked.

For example, earlier this year
Sidd Bikkannavar
, an engineer at NASA’s Jet Propulsion
Laboratory, was subject to a secondary airport inspection at the
airport in Houston, and was asked by a customs and border patrol
agent for the passcode to a phone he was carrying.

The phone belonged to NASA, and although Bikkannayar explained
as much, the agent continued asking for the code. Fearing that CBP
would seize the phone and that he would miss his connecting flight
to Los Angeles, Bikkannavar relented and provided it.

After around 30 minutes the agent returned with the phone,
telling Bikkannavar the phone had been analyzed with
“algorithms” and that no “derogatory”
information had been found.

The idea that the border or airport is a region of reduced
privacy expectations is not new. As Justice Rehnquist noted in the
1977 case United States v. Ramsey, the same Congress that
proposed the Bill of Rights passed the United States’ first
customs statute, giving officials the authority to search
“any ship or vessel, in which they shall have reason to
suspect any goods, wares or merchandise subject to duty shall be
concealed.”

It was also in Ramsey that Rehnquist declared,
“That searches made at the border, pursuant to the
longstanding right of the sovereign to protect itself by stopping
and examining persons and property crossing into this country, are
reasonable simply by virtue of the fact that they occur at the
border should, by now, require no extended
demonstration.”

Yet today, unlike 1977 or 1789, more than three
quarters
of American adults own smartphones. These devices
contain vast amounts of data related to our personal and
professional lives.
CBP policy
does not allow agents to access information housed
on remote servers, but even a search of information resident on an
electronic device can uncover videos, texts, photos and reveal what
apps someone has downloaded.

These apps can expose dating habits as well as religious
affiliations. Thanks to current policy, any traveler could be
coerced into allowing CBP to access this private information
without any suspicion that they have violated immigration law.

CBP searches of electronic devices are relatively rare, but the
number of such searches has been
increasing
over the last few years. These searches do not
always target travelers from terrorist hotspots, either.
Bikkannayar is an American citizen and member of the
Border Protection Global Entry program
, which is designed for
what CBP describes as “pre-approved, low-risk
travelers.”

Earlier this year then-DHS Secretary John Kelly discussed, among
other things, these electronic device searches at a Senate Homeland
Security and Governmental Affairs Committee hearing. While some
might think that the warrantless searches of electronic devices may
be a valuable counter-terrorism tactic, Kelly did not cite a single
instance where an electronic device search had lead to a terrorism
charge or conviction.

As the recent ACLU and Electronic Frontier Foundation suit
shows, these searches have disrupted the lives and violated the
privacy of a NASA engineer, a former Air Force Captain, a Harvard
graduate student, a nursing student, and entrepreneurs, all
citizens with no connections to terrorist activity.

It’s important that the federal government keep us safe
from foreign threats, and CBP should be able to examine phones and
laptops belonging to people who are the subject of a warrant. But
CBP should not have the authority to go on fishing expeditions for
incriminating data, harassing and intimidating citizens and
permanent residents without any evidence of wrongdoing.

Matthew
Feeney
is a policy analyst at the Cato Institute.

The ’25th Amendment Solution’ to Replace President Trump Is Nuts

Gene Healy

On Sunday morning, the president of the United States took time
out from mulling the North Korean nuclear crisis to retweet a gag GIF from a fan with the Twitter
handle “@fuctupmind.” In such circumstances, you
can hardly blame people for worrying about the condition of the
president’s mind.

Prompted by President Donald Trump’s repeated outbursts of
“Twitter Tourette’s” and erratic public
appearances, a growing number of legislators advocate using the
25th Amendment to remove the president on the
grounds that he’s mentally “unable to discharge the
powers and duties of his office.” Rep. Zoe Lofgren, D-Calif.,
recently introduced a resolution calling for
Trump’s examination by “psychiatric
professionals” and “immediate action” by Vice
President Mike Pence and the cabinet. A similar measure, the
Oversight Commission on Presidential Capacity
Act
,” from Rep. Jamie Raskin, D-Md., now has 28
co-sponsors, including more than half of the Democrats on the House
Judiciary Committee.

Granted, there’s ample reason to worry about a president
who drifts from ranting at Boy Scouts to making off-the-cuff nuclear threats. But declaring
Trump mentally disabled is constitutionally dubious and wildly
impractical. In their quest to “stop the madness,” the
25th Amendment brigade might create a situation more bizarre and
destabilizing than the Trump presidency itself.

The 25th Amendment wasn’t
designed to be an “eject” button for presidents who are impulsive,
reckless or otherwise spectacularly bad at the job.

That’s because the convoluted process Section 4 of the
amendment sets up for replacing the president could stick us with
two presidents and two cabinets jockeying for recognition as the
“real” government. The term “constitutional crisis” gets thrown around
far too loosely, but the “25th Amendment solution”
might just deliver the genuine article.

Back in 2012, when Trump was best known as the host of
“Celebrity Apprentice,” law professor Brian Kalt
published a book, “Constitutional Cliffhangers,” that
identified the 25th Amendment as a “constitutional weak
spot” that could crack, if put to the test. To illustrate the
danger, here’s an updated version of the scenario Kalt
sketches.

Imagine Vice President Mike Pence is privately more
Machiavellian than he lets on; and he’s begun plotting with
his colleagues at the Cabinet’s weekly Bible Study meeting. Pence and company
decide to pull the trigger, activating Section 4 with a declaration
to the Speaker of the House and the president pro tem of the
Senate.

Here’s how it might play out from there: Trump, enraged,
sends a counter-declaration to Congress contesting the charge. Then
he summons the cabinet, and unleashes his signature line from the
Apprentice: “You’re fired!”

Trump then replaces his rebellious “team of rivals”
with reliable subordinates. Pence and the original cabinet counter
with an additional, “no, really, he’s nuts”
declaration to Congress. When Trump orders the Secret Service to
frogmarch the “fake Cabinet” out of the building, how
do they respond? Who’s in charge here?

Section 4’s language is less than lucid on this point. It
specifies that, upon sending the initial declaration, “the
Vice President shall immediately assume the powers and duties of
the office as Acting President,” but “when the
President transmits … his written declaration that no inability
exists, he shall resume the powers and duties of his office
unless,” within four days, the VP and a majority of the
cabinet reaffirm that the president is incapacitated.

Whether Trump had the right to sack his cabinet turns on whether
it was “his” when he gave the order. Under Section 4,
does Pence hold the reins, pending Congress’ resolution of
the issue – as much as three weeks later — or does the president
get his powers back as soon as he informs Congress he’s up to
the job? Will Congress make the call, or will it be settled
by the Supreme Court, in a case that would make
Bush v. Gore seem low-stakes by comparison?

“It is indisputable,” Kalt writes, “that
Section 4’ s creators intended for the vice president to
remain in charge during this waiting period.” But since the
text is murky on this point, “if push ever comes to shove,
things could go very badly.” Indeed, as Kalt notes, the
provision is more likely to be used when things are already going
badly, in “an external crisis,” like the outbreak of a
major war.

Drafted in the wake of President John F. Kennedy’s
assassination, the 25th Amendment aimed at situations of near-total disability. It wasn’t designed
to be an “eject” button for presidents who are
impulsive, reckless or otherwise spectacularly bad at the job.

Impeachment is the proper
constitutional remedy
for that sort of presidential incapacity.
And, while a majority in the House and two-thirds of the Senate is
a heavy lift, the double-supermajority the 25th Amendment requires
to finalize the switch is a nearly insurmountable bar. As the
amendment’s principal architect, then-Sen. Birch Bayh,
D-Ind., explained, “We were concerned about the politics of
the palace coup,” and deliberately made it harder to remove a
president via Section 4 than it is to impeach him.

Still, the disability amendment has one advantage over the
old-fashioned method: If you think politics hasn’t been quite
entertaining enough lately, the “25th Amendment
solution” could really kick this reality show up a notch.

Gene Healy is a
vice-president of the Cato Institute and the author of The Cult of the Presidency.

Here Are the 3 Takeaways from Trump’s UN Speech

Sahar Khan

On Tuesday morning, President Donald Trump addressed the UN General Assembly for the
first time, unveiling his “American First” vision on
the world stage. His speech was marked with his trademark
bellicosity as he spoke about respecting sovereignty, destroying
North Korea, targeting Iran and criticizing Venezuela. While the
president did not reveal anything new about the U.S. stance on
various issues, the speech had three main takeaways that point to
an emerging Trumpian grand strategy that includes
buttressing homeland security and increasing the military
budget.

The first takeaway was recreating the Bush
administration’s “axis of evil” by targeting
North Korea and Iran’s varied nuclear ambitions. Referring to
Kim Jong-un as the “rocket man,” the president declared
the United States as “ready, willing and able” to
potentially attack North Korea, declaring the state’s pursuit
of nuclear weapons as “reckless” and a “suicide
mission.” He did look toward the UN, but not without his
known skepticism of the organization: “That’s what the
United Nations is all about; that’s what the United Nations
is for. Let’s see how they do.” Yet, the UN has been at
forefront of countering North Korea: fresh UN
sanctions
were placed on North Korea after it fired its latest
missile over Japan on August 15 following the joint U.S.-South
Korea military exercises.

The president then singled out the “murderous
regime” of Tehran and called the 2015 Iran Deal as “one
of the worst and most one-sided transactions the United States has
ever entered into” and “an embarrassment to the United
States.” But again, the Iran Deal has been successful in halting Iran’s nuclear
program. The president’s ambiguity on the Iran Deal now
has world leaders worried that if the United
States backs out and imposes sanctions, Iran might restart its
nuclear program.

The second takeaway from the president’s speech was a
familiar use of nationalist language and an emphasis on
sovereignty. Yet, as he called on world leaders to “fulfill
our sovereign duties to the people we faithfully represent,”
his actions at home have been doing the opposite. For example, a
month after taking office, he signed an
executive order
halting refugees from six Muslim countries,
affecting thousands of American families with Middle Eastern
roots
. Most recently, he moved to end the Deferred Action for Childhood
Arrivals (DACA) program that shielded illegal children from
deportation, again affecting thousands of American families and
businesses. Furthermore, by singling out North Korea, Iran, Cuba,
Syria and Venezuela, it is clear that not every state’s
sovereignty needs to be respected. Being so brazenly selective
about the sanctity of sovereignty can unnerve targeted nations and
incentivize destabilizing arms races. The president’s remarks
also seem to indicate his predilection for increasing military
spending to promote his “America First” strategy, which
is contrary to his desire to end nation building.

The final takeaway stems from the issues absent from his
remarks. The day before his speech, there was speculation that the
president would discuss how to reform the UN, a topic him and
Secretary-General António Guterres actually agree on. But he did not discuss any reforms.
Similarly, as he openly criticized socialism and communism, and its
devastating effects on Cuba, Venezuela, and the Soviet Union, he
did not mention China, a leading power that is politically
communist.

As the first opportunity to address the international community
as a leader, the president did what he did best: threaten force
without encouraging alliances and cooperation. Instead of taking
this opportunity to promote a grand strategy of great power
balancing
, the president instead opted for using the rhetoric
of realpolitik, stating that the United States
will be “guided by outcomes, not ideology.” Yet,
outcomes are almost always influenced by ideology. In other words,
the world heard what it expected to hear from President Trump: a
collection of contrary statements and a weak road map for world
peace.

Sahar Khan,
Ph.D. is a Visiting Postdoctoral Research Fellow at the Cato
Institute.

Graham-Cassidy Is a Too-Mild Improvement on Obamacare

Michael D. Tanner

Yogi Berra was right: It’s déjà vu all over
again.

Health-care reform is back on the table. With time rapidly
running out — the reconciliation rule that would allow
legislation to pass with just 50 senators’ votes expires on
September 30 — Republicans may take up yet another proposal
to “repeal and replace” Obamacare.

The legislation, proposed by Senators Bill Cassidy (La.) and
Lindsey Graham (S.C.), is less ambitious than previous repeal
efforts, which might just enable it to piece together enough votes
to pass. Essentially, Graham-Cassidy would fold all current
Obamacare funding, both premium subsidies and Medicaid-expansion
funding, into a single block grant to each state. Keeping this
money flowing means that Graham-Cassidy must keep most Obamacare
taxes in place. Only the individual and employer mandates and the
medical-device tax are repealed. This has led Rand Paul to warn
that the bill simply “rearranges the furniture a bit, changes some
names, and otherwise masks what is really going on — a
redistribution of ObamaCare taxes and a new Republican entitlement
program, funded nearly as extravagantly as ObamaCare.”

Single-payer is
inevitable if the GOP can’t come up with a bold
alternative.

Particularly troubling is the way that the bill’s sponsors are
using a reallocation of funding to round up support from reluctant
Republicans. The bill would shift money from some high-cost states,
such as California, Massachusetts, and New York, to more rural
states (read: red states). The bill’s supporters are essentially
playing the time-honored Washington game of promising “free money”
to the states. That never fails to be popular with governors and
senators from those states that “win.”

On the positive side, supporters of the legislation correctly
point out that it would give the states far more flexibility with
the funds they receive, and would allow them to waive many of
Obamacare’s more onerous regulations, including the mandate to buy
coverage, mandated benefits, and pre-existing-condition coverage
requirements. Those are the regulations most responsible for
driving up premiums and destabilizing insurance markets.

Meanwhile, on the other side of the aisle, Bernie Sanders has
introduced his latest version of “Medicare for All.” Like the
Republicans, Bernie has also scaled back his proposal, which
originally called for a government-run, single-payer system. This
one would cost only $1.4 trillion per year. That would be more than
a third of our entire current federal budget.

Wary that the price tag will likely terrify many Americans,
Bernie doesn’t actually include any mechanism in the bill to pay
for all this new spending. Still, his office suggests some
possibilities, including: a 7.5 percent hike in payroll taxes
(bringing the total tax to nearly 23 percent), a 4 percent
income-tax increase on all Americans, and additional tax hikes on
corporations and “the rich.” While calling his proposal Medicare
for All, he would actually offer benefits far more generous than
those found in current Medicare, including dental and vision care.
In fact, the benefits would be more generous than almost any
national health-care system anywhere, including Canada. And it
would all be “free”: No deductibles, co-payments, or out-of-pocket
costs.

And when Bernie says single payer, he means it. His plan would
outlaw private insurance, either employer-sponsored or individual.
If you don’t like what the government gives you, tough!

The contrast here is not just between rival health-care plans.
Ever since 1945, when Harry Truman first proposed a national
government-run health-care system, progressives have known what
they want. From Medicare and Medicaid through the Children’s Health
Insurance Program and the Affordable Care Act, they have advanced
steadily, if incrementally, toward that goal. We are not talking
about a conspiracy theory, but an ideological worldview that
encompasses health care.

Bernie’s plan is the latest step in that long march toward
government health care. It is not going to pass anytime soon. But
that fact that it is co-sponsored by 17 senators and supported by
nearly every rumored Democratic candidate for the 2020 presidential
nomination shows the degree to which Democrats are united around a
common goal. We can disagree with what they seek, but at least we
know what it is.

And, Republicans? They want a bill that will pass.

Think about it. In the battle of ideas over health-care reform,
Republicans have unilaterally disarmed. When was the last time
Republicans explained what a free-market health-care system would
look like, how it would work, and why it would be better for
health-care consumers? The old adage is true: You can’t beat
something with nothing.

That’s why Republicans are once again trying to eke out a narrow
win on a bill that slows but doesn’t reverse the ongoing march to
socialized medicine.

Michael
Tanner
is a senior fellow at the Cato Institute and the author
of Going for Broke: Deficits, Debt, and the Entitlement
Crisis.