A Teen Sexting Case Revealed How Judges Let Police Invade Children’s Privacy

Jay Schweikert

Whether the police have the right to force your teenage son to
masturbate in front of them in order to incriminate himself is a
legal question few parents would think they’d have to

And yet Trey Sims’ legal guardians had to do exactly that.
In an effort to prosecute the 17-year-old for sexting his
15-year-old girlfriend, Manassas police detective David Abbott
obtained a search warrant authorizing him to take
“photographs of [Sims’] genitals,” including
“a photograph of the suspect’s erect penis.”
According to court documents, in the process of
executing the search warrant, Abbott took the teenager to a
juvenile detention center, took him to a locker room and, with two
uniformed, armed officers looking on, ordered Sims to pull down his

After taking pictures with his cell phone of the
teenager’s genitals, Abbot then ordered the minor to
masturbate so that he could take a picture of his erection. Sims
tried but failed to comply with the officer’s orders; Abbott
later threatened Sims’ lawyer that, if police couldn’t
get a picture of the teenager’s erection by forcing the kid
to masturbate, he would obtain a photo of the teenager’s
engorged genitals by subjecting him to “an erection-producing
injection” at a hospital.

The overcriminalization
of personal behavior and qualified immunity for officers is a
dangerous mix.

The facts of this case are outrageous, but sadly, they’re not
the product of any single bad actor or law. On the contrary, they
reflect a criminal justice system that’s structurally broken at
almost every level. And the only reason that police never obtained
the pictures they demanded under court order from Sims was that
there was a massive public outcry after news reports emerged about the case in 2014,
and the police let the search warrant expire. (Sims, however,
continued to face felony charges for sexting his girlfriend,
eventually living under probation for a year before the courts
dismissed those charges.)

It wasn’t until this month — more than three years after
Sims was taken to that locker room — that a federal appeals
court issued a decision in his favor: By a divided
2-1 vote, the court held that a reasonable police officer should
have known it was unlawful to order a teenage boy to masturbate in
front of him and other officers.

Notably, though, that meant that one judge felt that police
should, indeed, have the right to do force children to masturbate
in front of them in order to incriminate themselves.

First and foremost, the fact that Sims’ initial conduct was
criminalized at all speaks to the staggering breadth of substantive
overcriminalization. The activity for which Sims was charged was a
consensual, mutual exchange of nude pictures and videos between two
teenagers in a lawful relationship (in Virginia, it’s
for a 17-year-old and 15-year-old to have sex).

Sexting between teenagers is commonplace, and often an innocuous part of flirtation and sexual
in the digital age. If the taking of or delivery of
pictures were non-consensual, or if one party was of the age of
majority, that would be a legal issue to address; for parents, such
behavior might well be concerning, if not deserving of some
proportionate punishment. But to brand Sims a child pornographer
under Virginia law is to say that a teenager’s consensual, (mostly)
non-harmful conduct merits one of our society’s most severe
punishments and social stigmas.

The criminal law is a blunt instrument and incarceration is an
extreme remedy; both are poorly equipped to address nuanced social
problems and should be a last resort for the most dangerous
antisocial behavior. Instead, they’ve become the reflexive default
for any behavior that certain segments of society find

And the legislative predilection for criminalization is
compounded by the judiciary’s failure to insist that the government
offer any justification for putting someone behind bars. In the
vast majority of cases, the state doesn’t have to show that
criminalization serves any legitimate interest, and the defendant
is not even permitted to introduce evidence to the

Further, the obscene invasion of Sims’ privacy shows just
how permissive courts are in letting cops search you almost
anywhere, in any manner, and for any reason. Even when police have
unlawful motives for stopping you — like racial discrimination —
a detention is still legally permissible so
long as there’s probable cause for something, including minor
traffic violations. Alerts from drug-sniffing dogs (i.e.,“probable cause creating” dogs) are
nearly always enough for a search, even if such alerts are barely more reliable than a coin flip.

And before admitting you to jail, state officials may conduct an invasive strip search,
no matter what you were arrested for (even traffic offenses), and
regardless of whether there’s any reason to suspect you have

So it’s outrageous but ultimately unsurprising that the
judicial system’s cavalier disregard for personal privacy, as
guaranteed by the U.S. Constitution, has led us to the point that a
judge can authorize and police will execute a “search”
that effectively amounts to the sexual assault of a teenager.
Whatever the supposed harm of Sims’ underlying behavior,
there is no doubt that a police officer forcing a teenager to
masturbate in front of armed adults under threat of a frightening
medical procedure is vastly worse than a teenager consensually
sexting his girlfriend.

And the difficulty that Sims has faced in vindicating his
constitutional rights shows how police operate with almost no
accountability for their actions. Following his ordeal, Sims filed
a civil rights lawsuit against Abbott, arguing that his
“search” violated his right of privacy under the Fourth
Amendment. Incredibly, the district court dismissed Sims’
complaint, finding that the detective was entitled to
“qualified immunity” for his actions. In other words,
even assuming that ordering a teenager to masturbate in front of
the police was unlawful, the law was not “clearly
established” enough for Abbott to know for sure that it was

In qualified immunity doctrine, “clearly established
law” usually requires not just a clear legal rule, but a
prior case with functionally similar facts. The perverse result of
this standard is that police will get immunity in the most
egregious cases, precisely for the reason that the most extreme
kind of misconduct is less likely to have occurred in the past.

The Fourth Circuit did reverse this dismissal and permit
Sims’ case to proceed, but even that was a close call. The
panel decision was 2-1; the argument made in the dissent, had it
been accepted by one other judge, would have granted Abbott total
immunity, going so far as to say that Abbott’s actions were

Sims’ case shows that we have a system in which the
legislative branch is permitted to criminalize whatever it wants,
with effectively no judicial oversight; police investigations are
invasive, unchecked, and can cause far greater harm than the
underlying criminal act; and it is nearly impossible to hold police
liable for unlawful misconduct. Until we address those systemic
problems, we should expect more tragic cases like this one.

is a policy analyst with the Cato Institute’s
Project on Criminal Justice.

Revisiting the EPA Endangerment Finding

Ross McKitrick

Environmental Protection Agency administrator Scott Pruitt is
mulling over how, or whether, to respond to demands
from climate skeptics that he reexamine the science that obligates
the EPA to issue costly carbon-emission regulations. While he has
recently acknowledged that agency staff
short-circuited the science review early in the regulatory process,
he may not realize that the EPA inspector general’s office flagged
this problem years ago, and the agency staff blew him off by means
of a preposterous legal fiction that has long been in need of

In 2009 the EPA issued the Endangerment Finding, which created a
statutory obligation to regulate carbon emissions. In the lead-up
to this decision the EPA had published its Technical Support
Document. Numerous petitions for reconsideration were subsequently
filed with the administrator citing evidence of bias and
cherry-picking in this report, but all of them fell on deaf

In April 2010, Senator James Inhofe (R., Okla.) asked the EPA’s
Office of the Inspector General to review the adequacy of the
peer-review process behind the Technical Support Document. The EPA
was not happy with what he unearthed.

It turns out that the federal government has rules in place
governing how the scientific basis for regulations should be
reviewed. Guidelines from the Office of Management and
Budget issued under the Information Quality Act impose varying
requirements depending on the uses to which a scientific assessment
will be put. The most rigorous process is for so-called Highly
Influential Scientific Assessments (HISA). These are scientific
assessments that will, among other things, lead to rules that have
an annual economic impact exceeding $500 million.

The inspector general issued a lengthy report in 2011 concluding (pp. 15-22)
that the EPA’s science assessment for the Endangerment Finding was
highly influential, but the peer-review process fell short of the
required standard. It even violated internal EPA guidelines, by
failing to publicly report the review results and cutting corners
in ways that potentially hindered the work of reviewers.

The EPA argued back, rather brazenly, that their report was not
an assessment at all, merely a summary of previous findings by the
U.N. Intergovernmental Panel on Climate Change, the National
Climate Assessment, and other reports, and these documents —
not any original research by the EPA — underpinned the
Endangerment Finding.

The inspector general rejected this argument for several
reasons. First, the EPA study clearly was an assessment, since it
selected certain lines of evidence for emphasis or exclusion and
used data not found in the underlying reports. Second, the
guidelines do not allow an agency such as the EPA to rely on peer
reviews conducted by outside groups such as the IPCC or the
National Climate Assessment team. Third, the inspector general
noted (p. 53) numerous occasions when the EPA cited the Technical
Support Document as the basis of its Endangerment Finding.

The EPA then argued that even if it was an assessment, it was
not “highly influential.” Since the Endangerment Finding was being
issued on a “stand-alone” basis with no specific regulations
attached, the investigation ended without resolution.

Thereafter the EPA proceeded to issue rules like the Clean Power
Plan with impacts far exceeding $500 million annually. By declining
to designate its science assessment as highly influential, the EPA
skirted the need to conduct the required peer review, but in so
doing it thwarted the intent of the statutory guidelines and
undermined the ethical basis of its actions.

While the courts may not demand that this situation be
rectified, Pruitt himself should. Administrative honesty demands
it, especially since the determination has large potential economic
ramifications. Specifically Pruitt needs to declare that the
Technical Support Document was a Highly Influential Scientific
Assessment that should have been reviewed as such in the first
place, and he should see to it that such a review now takes

While climate activists may object, they have also spent years
insisting that the science is settled, so if they are right, they
have no reason to worry about the outcome. And if they are unhappy
that this might delay the next round of rule-making, they should
direct their ire at Pruitt’s predecessor, who ought to have
undertaken the review back in 2011 rather than playing semantic
games to justify evading statutory peer-review requirements.

Regardless of Pruitt’s views on climate science, he should agree
that the regulatory process needs to be honest and procedurally
sound. This alone gives him sufficient grounds to initiate the
review that was supposed to have been done years ago.

is a professor of economics at the University of
Guelph and an adjunct scholar of the Cato Institute.

A Giant Puffing Sound

Simon Lester

Ross Perot warned of a “giant sucking sound” when the original
NAFTA was signed, but the new NAFTA being negotiated right now may
coincide with a giant puffing sound. Marijuana legalization efforts
in both Canada and the United States (and Mexico for medical
marijuana) will, as with most goods and services these days, become
intertwined with complex trade agreement rules on public health,
investment, intellectual property and state-owned enterprises.

So will the North American Free Trade Agreement bring us free
trade in cannabis? Or will the negotiators kill this buzz by
carefully drafting language that excludes marijuana products from
the trading system?

A few countries recently began legalizing marijuana for
production and sale in their domestic market. But what about
international trade? Why not allow consumers in foreign markets
where marijuana is also legal to purchase high quality marijuana
products from Colorado merchants?

We will get to that place someday, as countries’ experiences
with these products makes them more comfortable with accepting
marijuana products from abroad. But NAFTA is unlikely to achieve
anything here, as the issue of legalization is still controversial
and sensitive. For now, the Canada/United States and Mexico/United
States borders will not see marijuana products flowing freely and
legally. Instead, international trade in these products is likely
to remain prohibited, with border barriers on these products
probably justified under the standard trade agreement exceptions
for protection of “public morals” or “public health.”

However, modern trade agreements cover more than simple border
barriers, and more than two decades of experience with trade
agreements after NAFTA was signed have shown us how domestic policy
issues can lead to trade controversy and litigation. There are a
number of areas in which NAFTA rules may have an impact on the
marijuana marketplace as legalization progresses.

First, there is already some cross-border investment in
marijuana, with U.S. companies investing in Canada (the company that owns
Corona will pay $190 million for a stake in Canopy Growth
Corporation, which sells medical marijuana in Canada and plans to
sell recreational pot when it is legalized), and Canadians
investing in the United States. These investments will be subject
to NAFTA’s protections for foreign investment. Foreign investors
who believe that domestic regulations on marijuana industry
constitute “indirect expropriation” or do not accord “fair and
equitable treatment” — two of the key obligations in the
investment chapter — can sue the host government for damages
in an international tribunal. Domestic regulation in the marijuana
sector will be extensive and seems to be carried out in a clumsy
manner at times. As a result, there may be opportunities for
international lawsuits against these regulations.

Second, trade agreements have detailed protections for
intellectual property, and marijuana producers are creating some
valuable trademarks and patents. With regard to trademarks,
controversial disputes over cigarette packaging have been going on
in trade and investment tribunals for years, focusing on so-called
“plain packaging” of cigarettes as well as health warnings on these
products. Tobacco company Philip Morris has made headlines by
bringing investment treaty disputes against the governments of
Australia and Uruguay, and several governments challenged
Australia’s plain packaging regulations at the World Trade

For similar reasons, the inevitable regulation of marijuana
product branding could bump up against NAFTA’s trademark rules. And
patents are proliferating in the area of cannabis for medical use.
Different approaches by Canada and the United States to patent
protection could also lead to trade conflict, as was the case
already in a NAFTA complaint by pharmaceutical company Eli

Third, some Canadian provinces plan on distributing marijuana
through the state-controlled entities that currently sell alcohol.
For example, the Liquor Control Board of Ontario, a crown
corporation that is accountable to the Ontario Ministry of Finance,
will oversee the retailing of cannabis across the province through
stand-alone stores and an online ordering service. But in recent
trade agreements, the United States has pushed for special rules on
“state-owned enterprises and designated monopolies” where the
activities of those entities “affect trade or investment between
Parties within the free trade area.” Among other things, these
entities must act in a manner that is based on “commercial
considerations.” Similar rules are likely to be part of the NAFTA,
and this could have an impact on Canada’s plans for the sales of
marijuana products.

These are just a few examples. NAFTA rules on product standards,
food safety standards and banking regulations may also give rise to
concerns about the trade impact of marijuana regulation.

International trade in marijuana products is good for the same
reasons that legalization of marijuana is good: There are
considerable benefits from some of these products, prohibition does
not work, and any harms can be managed through appropriate
regulation. But it might be too early to expect significant
liberalization of marijuana through trade agreements. Getting
domestic markets up and running has been controversial enough, and
additional negative attention for the industry due to international
trade could make things worse.

With all this in mind, the NAFTA negotiators should think
carefully about how the various rules and exceptions they are
drafting might apply to marijuana products. Free trade in marijuana
is probably coming someday, but for now the negotiators’ focus
should be on crafting rules that keep controversy and litigation to
a minimum.

Simon Lester
is a policy analyst at the Cato Institute’s Herbert A. Stiefel
Center for Trade Policy Studies.

Brexit Will Only Mean Brexit If We Regain Control of Economic Rules

Ryan Bourne

The litmus test of whether “Brexit means Brexit” is
if the UK has regulatory sovereignty after leaving the EU. That
became clear last week, as the UK Government agreed to “full
alignment with those rules of the internal market and the customs
union” if no solution was agreed to prevent a hard Irish

Theresa May has insisted that “full alignment”
doesn’t mean being a supplicant EU rule-taker unable to
differentiate our laws. Instead, she says it’s about
achieving the same regulatory goals through different means.
But that’s not how other Europeans see it.
The Irish prime minister, Leo Varadkar, insists continued free
trade requires EU-UK harmonisation on everything from the
environment to food standards and labour laws.

Regulatory sovereignty is
a necessary condition for the UK to sign effective free trade
agreements with other countries.

Varadkar’s thinking is obviously an economic nonsense.
Mutually agreed standards, or harmonisation that breaks down
barriers, can deepen markets. But free trade does not necessitate
sharing maximum working hours regulation or directives on
collective redundancies. The EU itself has free trade agreements
with third countries which say nothing of these kinds of
regulations on processes.

As phase two of the talks begins then, and we seek our own free
trade deal with the EU, domestic sovereignty of economic regulation
must be a May red line. That means the UK must cease to be
regulated — directly or indirectly — as a member of the
single market, and instead be free to set domestic regulatory
policy. There are three reasons why this is important.

First, because it would be completely unacceptable for the UK to
be a rule-taker from Brussels. Having exited the EU, the UK would
have no vote on new single market rules, and would be a hostage to
potential damaging legislation. This would be particularly
worrisome for the financial sector, where the Commission has long
pushed for a highly disruptive financial transactions tax. But
similar concerns arise elsewhere.

Take the regulation of ports. The EU’s recent Port
Services Regulation is shaped by a desire to liberalise the
continent’s public sector port authorities with new
one-size-fits-all rules. But the UK’s ports are already
overwhelmingly privately owned, efficient and self-regulating.
Subjecting them to the EU’s new regulator, with the power to
enforce alternative providers of services and to cap fees, will
simply add inefficiencies and deter investment.

There are many other areas where the UK tends to be more
liberal, and where centralised EU laws could be damaging and

Mooted EU harmonisation on labour, bankruptcy, tax and corporate
laws can surely only be bad news for the UK, especially absent an
ability to vote and shape it. That’s to say nothing of
regulatory frameworks as new technologies arise, given the
EU’s tendency for lethargy and being overly cautious.

Second, and more importantly, harmonised regulation with the
single market would preclude us from altering existing laws in a
more pro-growth direction. The focus since the referendum has been
on external trade. But arguably the biggest potential boost from
not having to accept the acquis communautaire is provided
to internal trade — where deregulation could lower costs and
enhance GDP.

Now, at this point, sceptics usually invoke a caricature of
deregulation and talk about diluting safety in a “race to the
bottom”. So let’s take some specific examples.

Mark Carney, the Governor of the Bank of England, has
highlighted how Brexit is an opportunity to roll back regulations
which harm the City, including the bankers’ bonus cap,
elements of EU insurance regulation, and rules weighing heavily on
challenger banks.

The UK Treasury likewise wrote in 2015 about how
“European-level rules and agreements affect a range of policy
areas, from energy to financial services” in the context of
constraining productivity. It’s widely acknowledged that the
Common Agricultural Policy constrains innovation, while the
EU’s precautionary principle in farming regulation and GM
crops lowers crop yields.

Previous work by Open Europe from 2013 showed that 24 of the 100
most economically costly EU laws at the time, including the
Temporary Agency Workers Directive and the Energy Performance of
Buildings Directive, had costs exceeding benefits. A further 33 had
benefits that were intangible or not quantifiable.

Successive previous Tory manifestos pledged to seek repatriation
of employment law too, presumably because they thought beneficial
changes could be made.

Altering any of these regulations in isolation might not have a
big impact, but the cumulative effect is likely to be large. Yet
assessments of the economic impact of the UK leaving the EU tend to
ignore all these possibilities.

Finally, regulatory sovereignty is a necessary condition for the
UK to sign effective free trade agreements with other countries.
The UK is primarily a service-based economy, and will be seeking
deals to liberalise those sectors. That requires being able to
negotiate mutual recognition of regulatory standards with other
major economies. Yet if the UK is an EU rule-taker and does not
control its own regulatory frameworks, not only would this increase
uncertainty to third parties, but they would have little incentive
to agree deals with the UK, opting to deal with the EU

The conclusion is therefore clear. If the UK Government wants to
avoid damaging legislation being imposed upon it, if it wants to
enhance the growth potential of the economy, and if it wants (as it says) to sign lots of free trade deals
with third countries
, then it must regain control of domestic
economic regulation. If the price the EU sets for maintenance of
tariff-free trade is complete regulatory harmonisation, then no
deal would be better than that bad deal.

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

How to Play Geopolitical Poker with Kim Jong-Un

Doug Bandow

One of the chief fears about North Korea’s possession of nuclear
weapons is the increased risk of a conflict no one wants. It might
be started by accident, mistake, or misjudgment. By Kim Jong-un,
assume most Americans.

Yet the Democratic People’s Republic of Korea is behaving like
normal: bombastic and threatening in rhetoric, but cautious and
restrained in behavior. The DPRK’s last direct military
provocation, which justified South Korean retaliation and could
have triggered a conflict, was in 2010, with the sinking of a naval
vessel and bombardment of an island. Since then there has been
missile and nuclear testing, but only long-standard rhetorical
threats to act.

The Trump administration, in contrast, has dramatically changed
Washington’s approach. President Donald Trump has gone mano-a-mano
with Kim in the threat department. The former threatens fire and
fury and talks of sending armadas. Insults and warnings fly fast
and furious. More ominously, the president and his officials have
suggested that war is inevitable if the North does not concede
everything America demands. The DPRK must give up its missiles and
nukes and then hope for the best while apparently relying on
perhaps soon-to-be-former Secretary of State Rex Tillerson’s
promise that Washington does not seek regime change.

Now, more than ever, the
administration needs to take a grown up approach to the Korean

If President Trump is serious about starting the Second Korean
War, then he should be aware that more than North Koreans would
suffer. The first Korean conflict consumed three to four million
lives. Depending on the North’s capability to deliver weapons
of mass destruction—biological, chemical and nuclear—on
civilian targets such as Seoul and Tokyo, even more could die in
the second round. South Korea would again be a battlefield and the
entire peninsula would be wrecked; the economic disruption would be

Yet the danger may be almost as great if the president is only
attempting to intimidate Kim Jong-un. Threatening the North
strengthens its case for a nuclear deterrent: only with the ability
to retaliate against the U.S. homeland could Pyongyang be certain
of preventing an American attempt at regime change. The more
administration officials say war is going to happen, the more
urgent it is for the DPRK to perfect its missile and nuclear

Moreover, if the North believes an attack is inevitable, it
should plan to strike first. To stand by and allow Washington to
build up its forces, strengthen Seoul’s defenses, withdraw
noncombatants, and open the campaign with massive bombing of North
Korean forces would be to guarantee a speedy defeat. That movie
played twice in Iraq and shorter versions also were shown in
Afghanistan and Libya. Kim certainly doesn’t like the common

In contrast, damaging or destroying military and transportation
facilities in Pusan, Guam, Okinawa, Tokyo and elsewhere would
greatly hinder American efforts. The North might also attempt to
grab Seoul as a bargaining chip or threaten to retaliate against
Seoul and Tokyo if Washington did not agree to a ceasefire. Belief
that U.S. threats and actions triggered the conflict might divide
the Republic of Korea and its American ally.

Exactly what would convince the Kim regime that the Trump
administration was about to strike is unknown. But the
president’s aides and supporters seem to be doing their best
to make the threat appear real, which could have horrendous

For instance, UN Ambassador Nikki Haley, perhaps the shrillest
administration voice next to the president on attacking Pyongyang,
has questioned whether Americans would attend the upcoming Olympics
in South Korea. White House press secretary Sarah Huckabee Sanders
has said that Olympics attendance was an open issue about which
“no official decision has been made.” Imagine if the
administration announced that it was banning—or merely
recommending against—attendance at the global event.

Similar is Sen. Lindsey Graham’s insistence that the
administration should “start flying out noncombatant U.S.
citizens” from the South. Estimates of the number of
Americans who live in the ROK range up to a half million. That
number includes students, business people, tourists, and families
of diplomats and service members. Imagine if Washington announced
that it was initiating a massive airlift for Americans and
recommending against private travel to South Korea.

There would be consternation and panic in the South. Residents
of Seoul, who until now have remained largely unaffected by the
Kim-Trump rhetorical slugfest, could not help but react. Many would
start to look for an out as well. Even more so other foreign

The reaction in Japan would be similar. Th Japanese would see
U.S. military installations and Japanese cities alike at risk.
Moreover, Americans there and in Guam, also within range of North
Korean missiles, might demand transportation home as well. China
and Russia could not ignore what looked like Washington’s
unstated intent to attack.

Nor could the DPRK. Kim now might believe Trump to be a paper
tiger, big on rhetoric but not much else. However, if the United
States consciously and officially unleashes chaos across Northeast
Asia, the administration either is going all-in on a bluff or
really is preparing for the war that the president and his aides
have been planning.

In which case, the North would have to begin preparing its
response. To believe it was more geopolitical poker would be taking
a huge risk. Pyongyang at least would likely become hyper-sensitive
to American threats and actions, prepare to use or lose its most
important weapons, and plot how to disrupt U.S. plans. With such an
atmosphere, it wouldn’t take much to start the war that both sides
were treating as inevitable.

There are some adults in the administration. For instance,
Defense Secretary Jim Mattis responded to a question on the issue
by emphasizing diplomacy. One suspects that his private reaction
probably was a bit harsher. And the U.S. Olympic Committee, which
is not a government agency, insisted that it was having no second
thoughts about participating in the games that are to be held in
the mountainous region of Pyeongchang some fifty miles from the
DMZ, which marks the border with North Korea.

Hopefully the president realizes that war at any time is serious
business. War with a hostile, paranoid state which possesses a
sizable conventional military and variety of WMDs and missiles is
really serious. The lives of millions of people are potentially at

One of the dangers of nuclear proliferation is increasing the
chance of a war no one actually desires. Unfortunately, the United
States and North Korea could bring about such a calamity. Now, more
than ever, the administration needs to take a grown up approach to
the Korean Peninsula.

Doug Bandow is
a senior fellow at the Cato Institute. A former special assistant
to President Ronald Reagan, he is the author of several books,
including Tripwire: Korea and U.S. Foreign Policy in a Changed
and coauthor of The Korean Conundrum: America’s Troubled Relations
with North and South Korea

Gambling Away Federalism

Trevor Burrus

Pennsylvania legalized online gambling in late October,
becoming the fourth state to allow online betting. Some lawmakers
in Washington, however, would like the federal government to
override those states’ laws and prohibit online gambling
nationwide. The Restoration of America’s Wire Act(RAWA),
which has been floating around Congress since 2015 but is receiving
renewed attention, is an attempt to assert federal control over
states that have legalized online gambling. Just as states have
been allowed to experiment with marijuana legalization, Congress
should resist attempts to override state experiments in online

The story goes back to a 2011 Department of Justice memo that
clarified the interpretation of the 1961 Federal Wire Act, which
was passed to give federal officials the authority to go after the
mafia. When asked by the states of New York and Illinois whether
intrastate online lotteries would violate the Federal Wire Act, the
DOJ clarified that the 1961 law applied only to sports betting and
not to other forms of online gambling, freeing states to legalize
online gambling, as Pennsylvania and others have. Since that time
various lawmakers have been trying to either convince the DOJ to
revisit that interpretation or to amend the Federal Wire
Act-“restore” it, as the bill’s title says-to
cover online gambling.

Congress should resist
attempts to override state experiments in online

Seemingly spurred along by Pennsylvania’s law, in November
Senators Feinstein (D-CA) and Graham (R-SC) wrote a letter to the DOJ asking for reconsideration of the
2011 interpretation of the Federal Wire Act. They cite the usual
concerns: the children, society’s most vulnerable, and
organized crime as a reason to revisit the interpretation. Yet,
even if such concerns were valid, the Federal Wire Act clearly does
not apply to non-sports related gambling, as CEI’s Michelle
Minton has conclusively shown.

All of this arises as New Jersey is at the Supreme Court challenging a federal law,
the Professional and Amateur Sports Protection Act (PASPA), which
prohibits states from authorizing “a lottery, sweepstakes, or
other betting, gambling, or wagering scheme based” “on
one or more competitive games in which amateur or professional
athletes participate.” The law, which was passed in 1992,
carved out exceptions for four states-Delaware, Montana, Nevada,
and Oregon-and gave New Jersey the option to legalize sports
betting at casinos as long as it did so within a year after the law
went into effect. New Jersey didn’t do so at the time but now
it would like to. It tried twice to legalize sports betting, but
each time federal courts have said that PASPA prohibits it. Now at
the Supreme Court (the case was argued December 4th), the state is
arguing that such a prohibition violates the Tenth Amendment by
“commandeering” states to enforce federal law. The Cato
Institute has filed multiple briefs in the case, arguing that PASPA’s
prohibition violates the Tenth Amendment.

More broadly, as a voluntary activity between consenting adults,
gambling should of course be legal. Ironically, gambling is legal
in nearly every state in the form of state
lotteries. This is an absurd paradox that doesn’t get enough
attention: if the government can profit from it, then apparently
it’s not gambling. In 2014, Americans spent $70 billion on lotteries, more than their
spending on sports tickets, books, video games, movie tickets, and
recorded music sales combined. What’s more, the
poorest third of American households purchase half of all lottery

Prohibitions on gambling demonstrate a deep disconnect between
our laws and the behavior of most people. Millions of Americans
participate in annual NCAA March Madness office pools, to the tune
of over $10 billion per year. According to the American Gaming
Association, only 3 percent of that betting is legal. Certain types of home poker
games, which have greatly increased in popularity in the past 20
years, may be illegal in your state. And approximately 75
million people play fantasy football every year, often for money,
and daily fantasy sports leagues are of uncertain legal status in over a dozen

There is now a danger that RAWA may be surreptitiously inserted
into an appropriations bill, as has been tried before. The bill has received heavy
support from billionaire casino owner Sheldon Adelson, who has said he’s “willing to spend
whatever it takes” to stop online gambling. It’s odd
that a man who has made billions off of gambling would call online gambling “a societal train
wreck waiting to happen.” Perhaps his concerns are genuine,
but a cynic might think he’s trying to eliminate

Either way, the bill’s co-sponsors are almost all Republicans,
purportedly the party of federalism. As we’ve seen many
times, however, federalism has many fair-weather fans. Like many
political ideals, commitments to federalism are often abandoned
when given the opportunity to use the federal government to combat
disfavored state policies. Yet anyone who has lauded the trend of
“marijuana federalism” that is moving through the
states, should support “gambling federalism” for the
same reasons.

is a Research Fellow in the Cato Institute’s Center for
Constitutional Studies.

The Media Keep Saying the GOP Tax Bill Is Best for Rich Families. They’re Wrong.

Chris Edwards

There is one thing the mainstream media agrees on about the
Republican tax cuts. The “GOP Plan Evolved into a Windfall
for the Wealthy,” said a Washington Post
. An Associated Press
story discussed
, “How GOP Tax Plans Would Reward Rich
Families.” And a New York Times
editorial called it
, “A Tax-Cut Bill to Make Scrooge
McDuck Proud.”

That narrative is everywhere, and it is false. The GOP’s
tax proposals would give the largest relative cuts to the middle
class, increase subsidies to low-income households, and make the
tax code more progressive. Those are misguided policies, but that
is what Republicans will likely deliver even with some final tweaks
this week.

Let’s look at data on the Senate tax bill from the Tax Policy
Center. In 2019 the middle-income quintile (or one-fifth) of U.S.
households would receive an average tax cut of $840, while the top
quintile would receive $5,420. At first blush, the top group seems
to do better.

The GOP’s tax proposals
would give the largest relative cuts to the middle class, increase
subsidies to low-income households, and make the tax code more

However, the top group currently pays far more in income and
estate taxes, so its relative cut would be smaller. The tax cut for
the top quintile would be 8 percent of current taxes, while the cut
for the middle quintile would be a huge 23 percent. The Senate bill
trims the top income tax rate and the rate on small businesses, but
it cuts rates, doubles the standard deduction, and increases child
credits for the middle class.

Let’s look at other TPC data. The Senate bill would give
62 percent of the overall tax cut to the top quintile in 2019. But
that group pays 84 percent of individual income
taxes and 67 percent of all federal taxes. Since the tax cut
percentage for that group is smaller, it would pay a larger share
of overall federal taxes going forward.

What about the middle quintile? It currently pays 10 percent of
all federal taxes, but would receive 13.5 percent of the Senate
bill’s tax cuts in 2019. Thus, middle earners would gain an
extra-large share of the tax cuts.

As for lower-income households, they would receive a subsidy
increase. Currently, the bottom two quintiles of households do not
pay any federal income taxes on net. Yet those groups would receive
substantial tax “cuts,” which would be largely an
increase in refundable tax credits.

The bottom line is that the GOP tax cuts would make the tax code
more “progressive,” which is not a good idea because we

already have the most progressive
individual tax system of any
major industrial country.

Increased progressivity, or redistribution, undercuts the growth
potential of tax reform. The key to growth is cutting marginal tax
rates because that encourages working and other productive efforts,
yet the House and Senate bills only modestly trim individual

News reports say the final tax deal cuts the top individual rate
from 40 to 37 percent, which is good news because the top rate
creates a lot of economic damage. A basic rule is that damage rises
with the square of the marginal tax rate, so a 40 percent rate is
four times more damaging than a 20 percent rate. The upshot is that
every percentage point cut in the top rate matters.

Consider also that high earners, such as doctors and executives,
are productive people who have flexibility in their working and
investing decisions. They will respond relatively strongly to tax
rate cuts. So for individual tax reforms, high earners are the key
to boosting growth.

The GOP’s individual reforms produce only modest growth
benefits because the rate cuts are small. Tax Foundation
simulations find that the GOP’s business tax cuts would boost
the economy twice as much as the individual cuts, even though the
revenue losses from the latter are much larger. If the final bill
cuts the top individual rate, that would boost the growth

Whatever the final bill looks like, many news articles are
likely to call it “tax cuts for the rich.”
Unfortunately, that will embolden Democrats to try and undo the
pro-growth elements of the GOP tax reforms in the years ahead.

Republicans will need to set the record straight. The truth
about their plan is that the largest relative tax cuts go to the
middle class, while the business tax reforms will benefit all
income groups from stronger economic growth.

is a contributor to the Washington Examiner’s Beltway
Confidential blog.

Understanding ‘Net Neutrality’

Peter Van Doren and Thomas A. Firey

The FCC is set to vote on changing how the federal government regulates the internet, and commentators and activists are up in arms. New York Times technology writer Farhad Manjoo, for one, claims “the internet is dying.”

So what is the controversy about? FCC commissioner Ajit Pai proposes to repeal rules upholding “net neutrality” and replace them with a very simple rule: tell all customers about your services and prices in a transparent manner.

What is net neutrality? The internet is simply a set of pathways for transmitting packages of 1s and 0s—the basic language of computers—from one computer to another. When content (such as email, music, or video) is transmitted, the content is broken down into small packages of information, each of which, is sent separately over the internet to a destination computer, which then reassembles the information packages back into the content. Network neutrality requires that all the different packages of information be treated and priced alike by internet network providers regardless of who sent them or what information they contain.

While net neutrality sounds appealing, the actual internet experience that we have come to enjoy and expect actually requires non-neutrality. In the early days of the internet, packets of information were basically treated alike. This was back when the internet was a government-funded communications system that allowed university researchers to communicate with each other.

However, when the internet started to allow private internet service providers (ISPs) to connect to the government system in the 1990s, the structure of the internet became more complex. Private backbones supplemented the original government network, connecting through four backbone network access points. The four access points almost immediately became congested with traffic, which gave the backbone operators market power over regional ISP providers. To reduce congestion and limit backbone market power, ISPs quickly developed new pathways and connections.

Thus since the early days of the private internet there have been multiple paths for packets of information to travel. Similar packets have traveled over different pathways at different speeds and have long paid differing amounts to do so. These arrangements were not anti-consumer or anti-competitive. They were simply what was required to create redundancy and overcome market power.

In fact, they allowed content providers—websites, media streamers, and others—to reduce costs and increase quality of service because not all uses of the internet are alike in their technical demands on the network. For instance, email packets don’t have to arrive “simultaneously” for email to “work” but Skype packets do.

The management of those multiple paths and internet uses has been governed by contract, not government regulation. In fact, during the development of the internet from its early days to the present, regulation, including net neutrality regulation, has actually had very little effect.

The net neutrality regulations that exist today arose out of the rivalry between the different regulatory treatment of traditional telephone service and cable television. Telephone service had been subject to comprehensive regulation including pricing under Title II of the Federal Communications Act (FCA). But except for a brief period in the mid-1990s, cable television prices and service had not been subject to such regulation. When cable and telephone companies both started to provide internet service, the legal question was whether the internet would be subject to traditional Title II telephone regulation?

The FCC said no in 2002 and the Supreme Court agreed in 2005. But then the FCC began to change its mind. First, it tried to enact neutrality regulations using other parts of the FCA than Title II, but federal courts struck down those efforts in decisions in 2010 and 2014. So early 2015 the FCC adopted net neutrality rules using traditional Title II public utility provisions. In a pair of rulings in June 2016 and May 2017, the D.C. Circuit Appeals upheld that effort, and the rules finally went into effect. So the legal net neutrality regime that the FCC is set to rescind actually has not existed for very long and thus has had practically nothing to do with the internet’s flourishing up till now.

Net neutrality has captured the imagination of pundits and the public, but its effects on the actual technical and legal evolution of the internet have been rhetorical rather than real. Repeal of the net neutrality rules will not be the death of the internet. It will simply return us to the hands-off regulatory framework that has nurtured the past two-plus decades of the internet revolution.

Peter Van Doren and Thomas A. Firey are Cato Institute senior fellows and editor and managing editor, respectively, of Cato’s journal Regulation.

War with North Korea Appears More Imminent Than Ever

Doug Bandow

War on the Korean Peninsula appears to be a greater possibility
today than at any recent time. President Trump insists he will not
allow North Korea to develop the capability to target the U.S.
homeland. Meanwhile, Supreme Leader Kim Jong-un refuses to abandon
a project he believes to be necessary to guarantee his
regime’s survival.

The problem of intention is exacerbated by the threat of mistake
and misjudgment. Two impulsive blustery leaders of uncertain
temperament are facing off. With threats flying, military forces
moving, and WMDs testing, much could go wrong.

Yet President Trump appears to be doubling down on his strategy
of maximum military pressure. He continues to threaten war by
sending U.S. carrier groups and bombers to Northeast Asia to
demonstrate Washington’s resolve. American and South Korean
forces are also conducting military maneuvers. The allies insist
that “Vigilant Act 18” is merely a standard, annual
exercise. But it comes at an unusually sensitive time.

Provocative U.S. military
exercises in Northeast Asia aren’t helping.

The administration apparently presumes Pyongyang is not aware of
American military power. But it is. U.S. armed services are the
strongest argument for the North developing nuclear weapons and

At the end of the Korean War there was little left in North
Korea to bomb. When I first visited the Democratic People’s
Republic of Korea 25 years ago, officials commented that they had
to completely rebuild Pyongyang. America’s capacity to
destroy is even greater today.

Then, at least, China came to the DPRK’s rescue. But today
the North cannot count on similar aid. Beijing might act to preempt
an American advance to the Yalu; it would not, however, intervene
to preserve the Kim dynasty, especially if the latter bore at least
some responsibility for starting the war. Russia would be even less
inclined to act.

Nor does Pyongyang only fear conflict arising from the peninsula
itself. Since the end of the Cold War the U.S. has routinely
targeted regimes it dislikes: Panama, Somalia, Haiti, Serbia,
Afghanistan, Iraq (twice), Syria, and Libya. The latter is
particularly striking: Moammar Gaddafi made a deal with the U.S.
and Europe to abandon his nuclear and missile programs, only to be
ousted when his supposed new friends found it to be convenient. For
North Korea, the assurances of Secretary of State Rex Tillerson,
who doesn’t even speak for this president (let alone a future
one), are of little value.

So the DPRK is aware that America has substantial military power
and is willing to use it. The chief danger now may be that
Pyongyang ends up believing the Trump administration is preparing
to act when it is not.

When I again visited North Korea in June, officials were
particularly concerned about Washington’s intentions. Other
presidents have affirmed their willingness to take military action.
Trump has made the threat repeatedly. He has ramped up the
rhetoric, talking of delivering “fire and fury,” and
repeatedly sending U.S. military forces, which he once referred to
as the “armada,” to threaten the North. His officials,
as well as militaristic members of Congress such as Senator Lindsey
Graham, have spoken of the near-inevitability of war unless the
DPRK surrenders to Washington’s demands.

It is difficult to know what Pyongyang—or America’s
allies, for that matter—make of the administration’s
plans. But to the extent that North Korean officials take the
president’s rhetoric and actions seriously, they are likely
to perceive a heightened threat of war. And that is likely to make
the DPRK trigger-happy.

While U.S. officials are talking about a preventive war, which
differs from preemption in the lack of any imminent threat, the
North is likely to consider the need for actual preemption. North
Korea’s problem is that the U.S. and South Korea possess
vastly superior conventional capabilities, and allowing America to
take the initiative, and especially to build up beforehand, would
be suicidal. Of Saddam Hussein’s many mistakes, perhaps the
greatest was to stand idle as the United States deployed its forces
in preparation for war. He had no good options, but allowing
Washington to prep at its leisure guaranteed his destruction.

The DPRK faces the same problem. It has a quantitative edge, but
its equipment is aged and the allies would rule the skies. Allow
America to attack first, and it will quickly erode the
North’s conventional capabilities. The ensuing conflict would
still be costly, but ensure a more rapid defeat of the North Korean

So Pyongyang may believe it must use it or lose it. Wait for
America to mobilize, reinforce its ground forces, and conduct
massive bombing operations? Or strike to the extent it is able
to—we don’t know the exact capabilities of the
DPRK’s nuclear arsenal—first. That is, if the Kim
regime believed Washington was preparing for war, one could imagine
missile strikes on Pusan, Okinawa, Guam, and other American bases
in the region to impede any military buildup. Also likely would be
a concentrated artillery and missile attack on Seoul, perhaps
followed by rolling the tanks in an attempt to seize the Republic
of Korea’s capital, which could be used to negotiate the Kim
dynasty’s survival. The latter step might be backed by the
threat to hit Tokyo.

Exactly how a conflict would play out is impossible to predict.
But most assessments and wargames predict massive destruction and
casualties. The pessimistic counts are in the millions. After
having spent 64 years trying to prevent a Second Korean War, it
would be madness for Washington to trigger another potentially more
catastrophic conflict, even inadvertently.

While squaring the circle between the stated objectives of the
U.S. and North Korean governments won’t be easy, the most
important immediate goal should be to halt the seeming slide
towards war. Accelerating missile and nuclear tests by the North
and threats from Washington have ramped up tensions and made
mistakes and misjudgments more likely. The Trump administration
continues to insist that it won’t talk until the North agrees
to denuclearize, that is, yield on the very issue to be negotiated.
Pyongyang seems to believe that it faces a dangerous transition
period, during which Washington might strike on the theory that the
war would be “over there,” in Senator Graham’s
approving words. If so, the DPRK understandably wants to acquire a
full deterrent as quickly as possible.

The more the Trump administration flexes its military muscles to
demonstrate its seriousness, the more the North might believe that
the moment has come. In which case it might believe it must act

No doubt, annual exercises improve U.S.-South Korean military
cooperation. But the Republic of Korea’s continuing reliance
on America is outdated. The South possesses upwards of 45 times the
GDP, twice the population, and a vast technological edge over the
North. Seoul relies on the U.S. for conventional support only
because America allows it to do so. If more troops are needed, the
South should provide them. South Korea’s dependence should be
declining, especially as Washington faces ever greater budgetary
challenges. (The most important cost is increasing force structure,
not basing troops, to back the security guarantee.)

Pyongyang once proposed a freeze-for-freeze, that is, suspending
military exercises in return for freezing missile and nuclear
testing. Beijing is pushing the same measure. The objection that
the North is doing what it is supposed to while America and the
South are giving up what they are free to do is true but
irrelevant. Does the U.S. want to exacerbate or defuse the crisis?
Does Washington want to increase or decrease the chance of war?
Halting the threatening spiral upward would create some breathing

Such a step also would enhance the likelihood of continuing
Chinese cooperation regarding the DPRK. China long has insisted
that Washington, not Beijing, bears the blame for the North’s
nuclear program. Absent a U.S. “hostile policy,” China
believes, North Korea would not be so determined to arm itself in
such a way.

Whether true or not, a serious U.S. attempt to defuse the crisis
would increase the Trump administration’s leverage with
China. First, Washington could offer to suspend the
exercises—long criticized by the North—and develop a
comprehensive benefit package for Pyongyang, long sought by
Beijing. It would also need to press for unequivocal Chinese
backing. Finally, such an effort should include negotiations over
the DPRK’s future—how to protect Chinese interests in
the event of a North Korean collapse or Korean
reunification—and press for Beijing to back an American
negotiating initiative with the threat of an energy embargo.

The effort still might fail. The North might decide to go it
alone no matter what. Kim Jong-un might decide to let his people
starve before yielding his nuclear ambitions. But better to make
the best effort possible—and especially to reduce the
likelihood of conflict, intentional or accidental.

War on the Korean peninsula is too awful to contemplate.
Although deterrence and containment may be a second best when
dealing with the DPRK, the U.S. followed the same policy in
confronting Joseph Stalin’s Soviet Union and Mao
Zedong’s China. The likely price of a preventive war, without
persuasive evidence that Kim and his colleagues are suicidal, would
be far too high.

Which means the Trump administration’s highest priority
should be to keep the peace. That requires more than not starting a
conflict. The president also should reduce the pressure on North
Korea to start one as well. He should ratchet down tensions rather
than up. Preventing an accidental war would at least leave the
possibility of finding a solution in the future.

Doug Bandow is
a senior fellow at the Cato Institute and a former special
assistant to President Ronald Reagan.

Continuing Crack down in Hong Kong Risks China’s International Reputation

Doug Bandow

President Xi Jinping has ascended China’s political
mountaintop and is imposing his will on both the Communist Party
and Chinese people. What the PRC does at home no doubt concerns
people around the world. Nevertheless, China remains far freer
today than during Mao Zedong’s rule.

But Beijing’s domestic policies matter more when applied
to nominally autonomous Chinese territories, most notably Hong
Kong. The latter is not only the economically freest land on earth.
It also is governed by law, not men, and protects basic liberties.
But that appears to be changing, for the worse.

Seized by Great Britain from the decrepit Chinese Empire, Hong
Kong ended up on a 99-year lease and spent the 20th century as a
British colony. As such, the territory was liberal, not democratic.
And Beijing promised to preserve this unique characteristic after
Hong Kong’s return in 1997 as a Special Administrative

Instead of attempting to
stifle dissent in Hong Kong, they should channel criticism to more
productive ends, while demonstrating why the PRC is an attractive

Little changed for many years. But the 2014 Umbrella Revolution
featured youth-driven demands for the impossible: democratic
selection of the SAR’s political leaders. With the world
watching Beijing might have been willing to make some concessions,
but could not offer a political system which repudiated the
Communist Revolution. All the democratic protestors managed to do
was block any change, including modest reforms with a nod to
democracy proposed by the chief executive.

But intrusions in Hong Kong’s autonomy have since
increased. In 2015 several publishers critical of the PRC were
arrested by Chinese authorities in seeming violation of
international law. Last year two independence-minded activists were
blocked from taking their seats in the legislative council after
highlighting their contempt for Beijing while taking their oath of
office. Many residents of Hong Kong rejected what they saw as
juvenile publicity-seeking and the National People’s Congress
joined the controversy, approving legislation that disqualified
candidates who backed independence. The authorities then challenged
the election of another four political activists.

In July President Xi visited Hong Kong to mark the 20th
anniversary of China’s takeover and made clear his government
would not tolerate support for independence. In August three
leaders of the Umbrella Revolution were sentenced to prison for
their role in occupying a public square next to the government
headquarters three years before.

Now the territory’s Legislative Council is expected to
approve legislation pushed by Beijing to criminalize showing
disrespect to China’s national anthem, which is shown at Hong
Kong sporting events. Participants at soccer matches have booed,
chanted, and waved banners against the PRC. Hong Kong authorities
originally threatened to make the measure, which provides for a
prison term up to three years, retroactive. That, however, would
violate existing Hong Kong law.

Exactly how the measure would be enforced is unclear. But it
almost certainly will be challenged. Then Hong Kong will face the
embarrassing question of whether it is willing to jail its citizens
for what is pure free speech.

Much will be at stake in how it answers.

As China grows stronger it needs to learn the value of
forbearance. Beijing has the power to do most anything that it
wants not only in the mainland but also Hong Kong (and Macau).
However, prudence counsels for less rather than more.

First, Hong Kong is the canary in the mine for Taiwan. Most
Taiwanese, especially young people, do not identify with the PRC.
The authoritarian colossus next door is alien to their lives. Why
would they choose to be ruled from Beijing?

To accept even a looser connection would require trust in the
central authorities. What is occurring in Hong Kong is not
reassuring, however. The SAR’s special status survived a
couple decades, but looks ever more vulnerable. With a robust
democracy, the Taiwanese people have even more to lose.

Second, the status of Hong Kong is an indicator of
Beijing’s respect for international law. London never had the
means to enforce its agreement with the PRC over Hong Kong’s
return. However, both nations put much effort into the
negotiations. The resulting pact was a symbol of China’s
maturity. Instead of simply demanding the territory’s return,
Beijing negotiated with a colonial power which seemed to belong in
a different age. To ostentatiously toss aside the SAR’s most
important liberties would demonstrate a worrisome mix of arrogance
and impatience, sure to concern the PRC’s neighbors.

Third, targeting symbolic opposition rather than substantive
resistance guarantees organized disobedience with public support.
Plenty of Hong Kong residents oppose independence, or at least the
pursuit of independence against the PRC’s wishes. But they
also believe in allowing people to express their views freely.
Barring independence activists from the Legislative Council is
controversial but imprisons no one. Going after those deemed
disrespectful toward China would be a nightmare.

Fourth, Beijing needs to fight for the fabled hearts and minds
of Hong Kong residents. Repression makes the PRC even less
attractive, especially to young Hong Kongers. Legal dissent is the
equivalent of a popular steam valve, releasing public pressure.
China has sufficient security forces to “win” any
confrontation in the streets. But coercion and violence would be
devastating to the PRC’s international reputation.

With great power comes responsibility. So it is with China in
Hong Kong.

Officials not used to opposition in Beijing bridle at criticism
further from home. But instead of attempting to stifle dissent in
Hong Kong, they should channel criticism to more productive ends,
while demonstrating why the PRC is an attractive overlord.
Confrontation will benefit no one.

Doug Bandow is
a Senior Fellow at the Cato Institute. A former Special Assistant
to President Ronald Reagan, he is the author of several books,
including Foreign Follies: America’s New Global Empire.