Should Scotland Reclaim Its Independence?

At USA Today, I write about Scottish independence, which the Scottish people will vote on this coming Thursday. I note that the late Nobel laureate Gary Becker wrote in 2005, like Simon Lester today, that the disadvantages of small nations are much reduced in a world of free trade:

My conclusion is that developments in the global economy during the past 50 years have greatly reduced the economic disadvantages of small nations enumerated for his time by Hamilton. In fact, being small now may even have efficiency advantages…. [As trade barriers have come down over the past half-century,] small countries can now gain the advantages of large markets through trading with other nations.

I go over arguments on currency, tax rates, and the likelihood that an independent Scotland could be as socialist as some of its political leaders would like if it has to create its own prosperity. In the end, I write:

In any case, the economic arguments will go on till the vote on September 18. Scotland certainly has the elements necessary to be a successful European country. The real question is whether the Scots themselves desire, to borrow an Irish anthem, “that Scotland long a province be/A nation once again.” As a descendant of Scots who helped America secure its independence, I hope so.

I wrote previously about Scottish independence here

Posted on September 12, 2014  Posted to Cato@Liberty

Should Scotland Declare Its Independence?

I’m not Scottish. But my eighth-generation ancestor, Thomas Boaz, was born in Scotland in 1721. Seeking religious freedom, he migrated first to Ireland and then shortly to the colony of Virginia. So I have a romantic attachment to my distant Scottish heritage.

In 1997 I climbed the Wallace Monument, all 246 steps, on the 700th anniversary of the Battle of Stirling Bridge, at which Andrew Murray and William Wallace defeated the English forces, as seen in the movie Braveheart.

Now, in the 700th anniversary year of the Battle of Bannockburn when an army commanded by England’s King Edward II was defeated by a smaller force led by Robert the Bruce, Scotland is holding a referendum on independence. Advocates want to take Scotland out of the United Kingdom and assume their place in the world as an independent nation.

There are good arguments on both sides of the issue. Scotland has prospered in union with England, Wales, and Northern Ireland. Some scholars argue that the Act of Union in 1707 made the Scots part of a larger and more advanced nation and opened the way to the Scottish Enlightenment of David Hume and Adam Smith. And perhaps those modern ideas and the connection with England made possible the achievements of the inventor James Watt, the architect Robert Adam, the road builder John McAdam, the bridge builder Thomas Telford and later Scots such as Alexander Graham Bell and Andrew Carnegie.

There’s plenty of reason to believe the small nation would be a success.”

But whatever the benefits of union might have been in 1707, surely they have been realized by now. And independence for any country ought to appeal to Americans. So herewith a few arguments for independence.

1) Scotland is a nation. That’s simple enough. The Oxford dictionary defines a nation as “a large body of people united by common descent, history, culture, or language, inhabiting a particular state or territory.” That would be Scotland.

As it happens, England is a nation, too. Even today the English people often forget to call themselves “British.” The popular anthem “Jerusalem,” sung at the wedding of Prince William and Catherine Middleton in Westminster Abbey, concludes:

Till we have built Jerusalem,
In England’s green & pleasant Land.

England and Scotland are both nations with history and culture. They need not be combined in one state.

2) There’s some evidence that small countries enjoy more freedom and prosperity than larger countries. The Nobel laureate Gary Becker wrote in 2005,

My conclusion is that developments in the global economy during the past 50 years have greatly reduced the economic disadvantages of small nations enumerated for his time by Hamilton. In fact, being small now may even have efficiency advantages….[As trade barriers have come down over the past half-century,] small countries can now gain the advantages of large markets through trading with other nations.

Recent reports by Credit Suisse and by the Welsh politician and entrepreneur Adam Price lend some detailed support to that thesis. In any case, Scotland is hardly a uniquely small country. It has a similar population to Sweden, NorwayDenmark, or Switzerland.

Alex Salmond, the leader of the Scottish National Party and the likely first prime minister of an independent Scotland, may be a socialist, but he’s not an idiot. He knows that a tax hike in Scotland wouldn’t work. Asked in a televised debate, he responded, “We don’t have proposals for changing taxation. We certainly are not going to put ourselves at a tax disadvantage with the rest of the UK.”

As Alex Massie put it in the Spectator, “It’s not quite read my lips, no new taxes but it’s not far from it….When it comes to tax no other British politician in recent years has cited Arthur Laffer more frequently than Alex Salmond.” With a top British tax rate of 45 percent, and 41 percent  in Ireland, Salmond doesn’t want to raise the Scottish rate to 50 percent and push out top earners.

3) Critics of independence often say that Scotland is subsidized by wealthier England. The analysis is controversial, but it does appear that the United Kingdom spends about £1,500 ($2,500) more per person in Scotland than it does nationally. If it is true, as many British conservatives say, that Scots are whiny subsidy-suckers, then take them off the dole. It’s easy for a country with 52 members in the British parliament to demand more money from the British central government. An independent Scotland would have to create its own prosperity, and surely the people who produced the Enlightenment are smart enough to discover the failures of socialism pretty quickly if they become free, independent, and responsible for their own future.

4) Finally, surely the good people of England wouldn’t be churlish if Scotland decided to “dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature’s God entitle them,” as our Declaration of Independence put it. Some British opponents of independence insist that an independent Scotland couldn’t use the British pound, and that the UK would oppose Scotland’s admission to the European Union.

As it happens, Scotland had a successful independent monetary system from 1716 to 1845, as discussed by Lawrence H. White in his book Free Banking in Britain and in a new Harvard Ph.D. dissertation by Tyler Goodspeed. So maybe it doesn’t need the pound sterling.

But in any case, it’s not clear that the UK could stop Scots from using the pound. Several countries use the U.S. dollar as their currency. Economist Steve H. Hanke of Johns Hopkins University, a leading analyst of dollarization and currency boards, says Scotland could set up a currency board and essentially peg the new Scottish pound to the British pound one-for-one. Scots could do business with either Scottish or British notes.

As for the EU, it’s clearly important for small countries to be able to trade freely over a wide area. That’s the basic value of the EU. But many Britons now chafe under the rules and regulations of the EU bureaucracy. Maybe Scotland would do better to join the European Economic Area, a broader common market of European countries that aims to “enable goods, services, capital, and persons to move freely about the EEA in an open and competitive environment, a concept referred to as the four freedoms.” Free trade, no supranational regulations, what’s not to like?

England and the UK would only hurt their own citizens if they sought to prevent free trade and joint currency with Scotland. Governments have been known to hurt their own citizens in pursuit of power, but the British people would have good reason to insist that they be free to trade with their neighbors across the River Tweed.

In any case, the economic arguments will go on till the vote on September 18. Scotland certainly has the elements necessary to be a successful European country. The real question is whether the Scots themselves desire, to borrow an Irish anthem, “that Scotland long a province be/A nation once again.” As a descendant of Scots who helped America secure its independence, I hope so.

Posted on September 12, 2014  Posted to Cato@Liberty

Who Pays for Campaigns?

While the Senate votes on a constitutional amendment to carve out an exception to the First Amendment by limiting spending on political campaigns, members of Congress have no compunctions about spending tax dollars on their own re-elections. WAMU radio in Washington reports on some of the expenditures by D.C., Maryland, and Virginia members: 

“I think franked mail is a tool that can be used to communicate with your constituents,” [Rep. Gerry] Connolly [R-Va.] says.

Last year Connolly spent more than $94,000 of your tax dollar on mostly glossy, color pamphlets with pictures of him at his office declaring his support for federal workers, while D.C. Del. Eleanor Holmes Norton spent just over $3,000 touting her record. Maryland Democrat John Delaney spent more than $50,000, which his press secretary says is to introduce his freshman boss to voters, which watchdogs say gives him a leg up over his challenger, Republican Dan Bongino. Congressman Randy Forbes (R-Va. 4) spent about $30,000 on Facebook ads, railing against “Obamacare,” questioning “Free taxpayer funded cell phones” and on dozens of electronic polls, which he defends.

It’s not that members of Congress object to people spending money on elections. They just want the people’s money sent to Washington, and spent by Congress, on their own re-election efforts. So much less messy and divisive that way.

Posted on September 9, 2014  Posted to Cato@Liberty

Are Democratic-Appointed Judges a Sure Thing for ACA?

Jason Millman of the Washington Post’s Wonkblog casually assumes that Democratic-appointed judges can be counted on to uphold the Affordable Care Act and its implementation against any legal challenge:

The Obama administration and supporters of the president’s health-care law are probably breathing a little easier this morning after some pretty big news from the U.S. Court of Appeals for the District of Columbia.

A few months after a three-member panel of the court ruled the federal government can’t provide insurance subsidies through federal-run exchanges in 36 states, the court on Thursday granted the Obama administration’s request for the entire panel to re-hear the case. The en banc hearing, as it’s known, wasn’t entirely unexpected—and with a heavy makeup of Democratic-appointed judges on the panel, it seems likely the administration will get a more favorable ruling when the entire court reconsiders the case later this year.

I don’t know. I know that Obamacare passed in both the House and Senate on straight party-line votes, over unanimous Republican opposition. But judges aren’t politicians. With a slew of Reagan- and Bush-appointed judges striking down gay marriage bans, I hope and expect that Democratic-appointed judges will show similar nonpartisan judiciousness when they consider the challenge to the IRS’s illegal implementation of insurance subsidies.

Posted on September 5, 2014  Posted to Cato@Liberty

Net Neutrality — or Destroying Internet Innovation and Investment?

The Sunlight Foundation reports that the Federal Communications Commission has received more than 800,000 public comments on the topic of “net neutrality,” more than 60 percent of them form letters written by organized campaigns and more than 200 from law firms on behalf of themselves or their clients. That’s an impressive outpouring of public comments. 

But Berin Szoka, a long-ago Cato intern who now runs TechFreedom, argues, “This debate is no longer about net neutrality. A radical fringe has hijacked the conversation in an attempt to undo two decades of bipartisan consensus against heavy-handed government control of the Internet.” TechFreedom has just launched DontBreakThe.Net, a web-based campaign to expose the danger facing the internet from well-meaning demands for something called “net neutrality.” In an open letter to FCC chairman Tom Wheeler, Szoka says:

Subjecting broadband to Title II of the 1996 Telecom Act would trigger endless litigation, cripple investment, slow broadband deployment and upgrades, and thus harm underserved communities. Al Gore may not have exactly ‘invented the Internet,’ but President Clinton’s FCC chairman Bill Kennard deserves much credit for choosing not to embroil the Internet in what he called the ‘morass’ of Title II. Kennard’s approach of ‘vigilant restraint’ unleashed over $1 trillion in private investment, which built the broadband networks everyone takes for granted today. Abandoning that approach would truly break the Internet.

Net Neutrality supporters such as Google, Facebook, and the NAACP haven’t jumped on the Title II bandwagon because they understand that Title II would threaten the entire Internet. Title II proponents claim the FCC can simply ‘reclassify’ broadband, but in truth, there’s no such thing as reclassification, only re-interpretation of the key definitions of the 1996 Telecom Act. If the FCC re-opens that Pandora’s Box, the bright line Chairman Kennard drew between Title II and the Internet will disappear forever. Startups and edge/content providers will inevitably be caught in the fray. And besides, the FCC has a long history of overstepping its bounds.

Invoking Title II would trigger years of litigation. It’s not clear the FCC could ultimately ‘reclassify’ broadband at all, and even less clear the FCC could, or actually would, follow through on talk of paring back Title II’s most burdensome rules, like retail price controls. Even if ‘reclassification’ stood up in court, the FCC still couldn’t do what net neutrality hardliners want: banning prioritization. The FCC would succeed only in creating a dark cloud of legal uncertainty. That would slow broadband upgrades and discourage new entrants, such as Google Fiber, from entering the market at all.

The best policy would be to maintain the ‘Hands off the Net’ approach that has otherwise prevailed for 20 years. Innovation could thrive, and regulators could still keep a watchful eye, intervening only where there is clear evidence of actual harm, not just abstract fears. As former FCC Chairman Bill Kennard put it, ‘I don’t want to dump the whole morass of Title II regulation on the cable pipe.’ If we want to maintain a free and open Internet, and encourage broadband competition, the FCC would do well to heed his advice.

TechFreedom created this catchy graphic for its campaign to encourage more people to understand what’s at stake in the so-called “net neutrality” fight.

Don't Break the Net 

Posted on September 2, 2014  Posted to Cato@Liberty

David Boaz discusses the phrase “The War on…” on FBN’s The Independents

Posted on August 30, 2014  Posted to Cato@Liberty

They’re Not Making Jeff Smiths Like They Used To

Movie poster

For generations of Americans, “Jefferson Smith” was the archetype of the honest, hard-working man of the people who gets into politics to serve the public interest and stands up to powerful interests. Mr. Smith Goes to Washington is the quintessential movie about a corrupt system that can be toppled by a single man of integrity. So maybe it’s no surprise that there seem to be a lot of Jeff Smiths getting into politics. What better name to inspire confidence?

Unfortunately, Sen. Jeff Smith of some unnamed Western state would be mighty embarrassed by some of the Jeff Smiths who have come along in his wake.

Today in Washington, D.C., former city council candidate Jeff Smith was sentenced to 60 days in jail for accepting illegal campaign funds and making false reports to the city’s campaign finance office. Like D.C. mayor Vincent Gray, Smith was essentially accused of benefiting from an illegal shadow campaign run by a major donor who makes his money from city contracts.

Today’s Jeff Smith story reminded me of one from a few years ago. As Jason Zengerle reported in the New Republic, Missouri state senator Jeff Smith “was the brightest young star in the Missouri Democratic Party. Thanks to an award-winning documentary about him, he was also a national political figure—a crusading reformer whose combination of charisma, idealism, and intelligence prompted comparisons to Howard Dean, Paul Wellstone, and even Barack Obama. Although he was only in his first term, no one (least of all of Smith himself) doubted he was destined for greatness.”

Jefferson Smith was the leader of the Boy Rangers. Jeff Smith of Missouri taught political science at Washington University and had equally devoted young supporters. Indeed, that Jeff Smith was so Capra-esque – at least to liberal eyes – that filmmaker Frank Popper made a film about him. Zengerle writes that the film, “Can Mr. Smith Get to Washington Anymore?, is a minor masterpiece of the political documentary genre. After its release in 2006, it broadcast nationally on PBS’s prestigious ‘Independent Lens’ series and earned Popper, a first-time feature director, numerous festival accolades.”

But then it all went wrong. Right from the beginning, actually. In his first campaign, afraid of losing, Smith turned to some sketchy operatives who put together – whattaya know? – an illegal shadow campaign to attack his opponent. Eventually the FEC came calling, and then the FBI. Things spiraled out of control. One of the operatives ratted him out. His campaign manager committed suicide. Smith was sentenced to a year in jail.

I remember hearing back in Kentucky about a woman who refused to vote for a friend for public office because “if a man’s not ruint when he gets in there, he’s ruint when he comes out. And there’s no sense in ruining a good time.” Frank Capra’s fictional Jeff Smith could resist the temptations of power, but it seems that a lot of regular folks named Jeff Smith – or anything else – can’t.

 

 

Posted on August 28, 2014  Posted to Cato@Liberty

How the British Burned Washington

The British burned Washington 200 years ago today. In the Washington Post Joel Achenbach, with help from Steve Vogel, author of Through the Perilous Fight, tells how the day went, including this description of how thorough and careful the British were:

The British knew how to build a bonfire. You just stacked the furniture, sprinkled it with gunpowder and put a torch to it.

They built multiple fires inside the Capitol, immolating the Supreme Court, the Library of Congress and the splendid chambers of the House and Senate.

Later in the evening, Ross and Cockburn made their way to the White House and helped themselves, amid hearty toasts, to the fabulous meal and adult beverages left by Mrs. Madison and her staff. They took a few souvenirs, and one filthy lieutenant ventured into the president’s dressing room and put on one of the president’s clean linen shirts.

Then they set the fires. Up in flames went some of the most beautiful furniture in the country, including pieces obtained by Jefferson in Paris and the private possessions of the Madisons. The fires left the mansion a gutted, smoldering shell.

The British also burned the Treasury building, and the building housing the War and State departments. They ransacked the National Intelligencer newspaper office, with Cockburn ordering the seizure of all the letter C’s from the presses so that the editor could no longer write nasty things about him. The Americans themselves burned the Navy Yard to keep the ships and stores out of British hands. 

The invaders spared private dwellings. This was to be a civilized sacking; no rapes, no murders, minimal plundering. They even spared the Patent Office after being persuaded that patents were private property.

 One would hate to think that the British army was more respectful of private property rights than the current U.S. government.

 

 

 

Posted on August 24, 2014  Posted to Cato@Liberty

David Boaz discusses ”enemies of freedom” on FBN’s Independents

Posted on August 18, 2014  Posted to Cato@Liberty

Is Hillary the Heir Apparent?

The New York Times reported Thursday:

Mr. Obama is fast becoming the past, not the future, for donors, activists and Democratic strategists. Party leaders are increasingly turning toward Mrs. Clinton and her husband, former President Bill Clinton, as Democrats face difficult races this fall in states where the president is especially unpopular, and her aides are making plain that she has no intention of running for “Obama’s third term.”

Which put me in mind of this statement famously attributed to another woman who had “the heart and stomach of a king” and the will to rule, Queen Elizabeth I:

I know the inconstancy of the English people, how they ever mislike the present government and have their eyes fixed upon that person who is next to succeed. More people adore the rising sun than the setting sun.

Which is why Elizabeth never designated a successor. Every incumbent president probably wishes he had that power.

Posted on August 16, 2014  Posted to Cato@Liberty

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