The Market for Law

David Boaz, David Friedman Is there a market for good law? Without the state providing law, could it be offered by multiple, private, and competing agencies? David Friedman, professor of law at Santa Clara University, explored this idea in his classic 1973 book, The Machinery of Freedom: Guide to a Radical Capitalism. But in the years since, he's revised and strengthened some of his theories. In this talk, Friedman will offer these new ideas from the last 30 years of thinking about the market for law.

Posted on November 29, 2011  Posted to Cato@Liberty

Idiosyncrasy in the New York Times

Webster's defines "idiosyncrasy" as "a peculiarity of constitution or temperament" or "characteristic peculiarity (as of temperament); broadly: eccentricity." And what does the New York Times define as an idiosyncrasy? A headline this weekend tells us that
Idiosyncrasy Runs Deep in the Soil of Wyoming
And what's this idiosyncrasy? Cowboy poetry? Jackalopes? Being the first state to grant women the vote? No, here's what the Times finds idiosyncratic:
Wyoming’s way — always idiosyncratic in the windblown, rural grain that mixes mind-your-own-business cowboy libertarianism and fiscal penny-pinching — is getting its moment in the spotlight.
Yep, what the New York Times finds idiosyncratic in a nation formed to guarantee the inalienable rights of life, liberty, and pursuit of happiness is a libertarian spirit combined with fiscal conservatism. It's not clear that Wyoming lives up to this picture: The Cato Institute's Fiscal Policy Report Card on America's Governors noted in 2006 that Wyoming's budget had risen 60 percent in less than four years. And the Mercatus Center report "Freedom in the 50 States" put Wyoming barely above the national median for both personal and economic freedom. But the libertarian instincts are there, as Jason Sorens and I found in calculations of voter attitudes in the states. So let's hear it for "mind-your-own-business cowboy libertarianism and fiscal penny-pinching" -- may it spread beyond the four corners of idiosyncratic Wyoming.

Posted on November 27, 2011  Posted to Cato@Liberty

The Future of Growth

Just in case you were wondering where future growth might come from, the Washington Post reports:
a new analysis warns that the Washington area doesn’t have nearly enough housing for the wave of new workers that will arrive in coming decades. Researchers at George Mason University say the area is projected to add more than a million new jobs by 2030.
That's the future we can expect if we don't start constraining the size, scope, and power of the federal government: further transfers of wealth from the rest of the country to Washington, from the productive sector to the redistributive and regulatory sector.

Posted on November 27, 2011  Posted to Cato@Liberty

David Boaz on Obamacare and executive power on Fox Business

Posted on November 23, 2011  Posted to Cato@Liberty

Things to Be Thankful For

Not long ago a journalist asked me what freedoms we take for granted in America. Now, I spend most of my time sounding the alarm about the freedoms we’re losing. But this was a good opportunity to step back and consider how America is different from much of world history — and why immigrants still flock here. If we ask how life in the United States is different from life in most of the history of the world — and still  different from much of the world — a few key elements come to mind. Rule of law. Perhaps the greatest achievement in history is the subordination of power to law. That is, in modern America we have created structures that limit and control the arbitrary power of government. No longer can one man — a king, a priest, a communist party boss — take another person’s life or property at the ruler’s whim. Citizens can go about their business, generally confident that they won’t be dragged off the streets to disappear forever, and confident that their hard-earned property won’t be confiscated without warning. We may take the rule of law for granted, but immigrants from China, Haiti, Syria, and other parts of the world know how rare it is. Equality. For most of history people were firmly assigned to a particular status — clergy, nobility, and peasants. Kings and lords and serfs. Brahmans, other castes, and untouchables in India. If your father was a noble or a peasant, so would you be. The American Revolution swept away such distinctions. In America all men were created equal. Thomas Jefferson declared “that the mass of mankind has not been born with saddles on their backs, nor a favored few booted and spurred, ready to ride them legitimately, by the grace of God.” In America some people may be smarter, richer, stronger, or more beautiful than others, but “I’m as good as you” is our national creed. We are all citizens, equal before the law, free to rise as far as our talents will take us. Equality for women. Throughout much of history women were the property of their fathers or their husbands. They were often barred from owning property, testifying in court, signing contracts, or participating in government. Equality for women took longer than equality for men, but today in America and other civilized parts of the world women have the same legal rights as men. Self-government. The Declaration of Independence proclaims that “governments are instituted” to secure the rights of “life, liberty, and the pursuit of happiness,” and that those governments “derive their just powers from the consent of the governed.” Early governments were often formed in the conquest of one people by another, and the right of the rulers to rule was attributed to God’s will and passed along from father to son. In a few places — Athens, Rome, medieval Germany — there were fitful attempts to create a democratic government. Now, after America’s example, we take it for granted in civilized countries that governments stand or fall on popular consent. Freedom of speech. In a world of Michael Moore, Ann Coulter, and cable pornography, it’s hard to imagine just how new and how rare free speech is. Lots of people died for the right to say what they believed. In China and Africa and the Arab world, they still do. Fortunately, we’ve realized that while free speech may irritate each of us at some point, we’re all better off for it. Freedom of religion. Church and state have been bound together since time immemorial. The state claimed divine sanction, the church got money and power, the combination left little room for freedom. As late as the 17th century, Europe was wracked by religious wars. England, Sweden, and other countries still have an established church, though their citizens are free to worship elsewhere. Many people used to think that a country could only survive if everyone worshipped the one true God in the one true way. The American Founders established religious freedom. Property and contract. We owe our unprecedented standard of living to the capitalist freedoms of private property and free markets. When people are able to own property and make contracts, they create wealth. Free markets and the legal institutions to enforce contracts make possible vast economic undertakings — from the design and construction of airplanes to worldwide computer networks and ATM systems. But to appreciate the benefits of free markets, we don’t have to marvel at skyscrapers while listening to MP3 players. We can just give thanks for enough food to live on, and central heating, and the medical care that has lowered the infant mortality rate from about 20 percent to less than 1 percent. A Kenyan boy who managed to get to the United States told a reporter for Woman’s World magazine that America is “heaven.” Compared to countries that lack the rule of law, equality, property rights, free markets, and freedom of speech and worship, it certainly is. A good point to keep in mind this Thanksgiving Day. This article originally appeared in the Washington Times in 2004 and was included in my book The Politics of Freedom.

Posted on November 23, 2011  Posted to Cato@Liberty

Fun with Grammar

Juliet Eilperin at the Washington Post writes:
Less than a week before U.N. negotiators convene in South Africa for a new round of talks aimed at forging a global climate pact, a hacker has released an apparent second round of e-mails from the University of East Anglia in Britain that seek to portray climate scientists in a negative light.
Now let's break that sentence down. Could it really be the e-mails from the climate catastrophists that "seek to portray [themselves] in a negative light"? Surely not. Rather, it appears that the sentence was intended to read something like this:
...a hacker believes that the apparent second round of e-mails from the University of East Anglia that he released today portray climate scientists in a negative light.
If there's any embarrassment to the writers of the e-mails, after all, surely it was not intended. In any case, it's not the release of the e-mails that might "portray [some] climate scientists in a negative light," it's the e-mails themselves. More on the original Climategate here. Ongoing posts at this climate-skeptic website. And as you hear terms like "skeptics," "deniers," and so on, remember what Pat Michaels wrote in the 2009 Cato Handbook for Policymakers:
Leading politicians and media figures are insisting that Congress make global warming a very high priority. Global warming is indeed real, and human activity has been a contributor since 1975. But global warming is also a very complicated and difficult issue that can provoke very unwise policy in response to political pressure. In 2005, for instance, Congress clearly made a very bad decision about climate change when it mandated accelerated production of ethanol. Critics had argued then that corn-based ethanol would actually result in increased carbon dioxide emissions. An increasing body of science has since verified this position. Further, corn-based ethanol is responsible in part for the skyrocketing price of corn, soybeans, rice, and wheat since the mandates began. Although there are many different legislative proposals for substantial reductions in carbon dioxide emissions, there is no operational or tested suite of technologies that can accomplish the goals of such legislation. Fortunately, and contrary to much of the rhetoric surrounding climate change, there is ample time to develop such technologies, which will require substantial capital investment by individuals.
He's a skeptic about the predictions of catastrophic and imminent threats, not about the existence of modest global warming.

Posted on November 22, 2011  Posted to Cato@Liberty

Solyndra: Crooked Politics or Just Bad Economics?

Amy Harder has a good take on the Solyndra issue in National Journal Daily (subscription required):
Lesser evil: crony capitalism or bad policy? Energy Secretary Steven Chu is about to find out when he testifies before a House panel on Thursday about the $535 million loan guarantee his department awarded to Solyndra, the now-bankrupt solar-energy company that was, before its demise, the poster child for America’s renewable-energy industry and President Obama’s 2009 Recovery Act. The White House and the Energy Department say the influence of political donors such as Oklahoma oil billionaire George Kaiser, whose venture-capital firm was the major investor in Solyndra, did not sway any of the administration’s decisions on Solyndra’s loan guarantee, which was funded from the stimulus package. By denying politics was involved, the administration is saying that its top officials genuinely and continuously thought Solyndra was a good bet—despite numerous warnings raised both inside and outside of the administration—and that the loan-guarantee program was being carefully managed despite oversight reports and an internal West Wing memo that said otherwise. “As time went on, there was a growing concern because of the cash-flow,” Chu said in an interview with NPR on Tuesday. “And so we certainly were watching this and looking at this very closely. And eventually we recognized they were in deep trouble.” Yet, throughout the two years Solyndra was borrowing money from federal coffers, the DOE essentially stayed the path right up until the bitter end when the California-based manufacturer went bankrupt in September. When Solyndra was on the brink of bankruptcy in late 2010, DOE decided to restructure the loan to try to keep the company afloat.
Meanwhile, in today's congressional hearing, Energy Secretary Steven Chu insisted that “the final decisions on Solyndra were mine, and I made them with the best interest of the taxpayer in mind. . . . I did not make any decision based on political considerations.” This came on a day when the front page of the Washington Post reported:
In the two years preceding its collapse, Solyndra and its biggest investor aggressively asserted themselves in dealings with the Obama administration, pushing Energy Secretary Steven Chu to visit the company’s headquarters to help it raise private money and later suggesting it would file for bankruptcy if the Energy Department rejected its proposed rescue plan. . . . “The DOE really thinks politically before it thinks economically,” a Solyndra board member wrote in December to George Kaiser, an Obama fundraiser whose family funds owned a third of the company.

Posted on November 17, 2011  Posted to Cato@Liberty

David Friedman at Cato

David Friedman, the author of  Hidden OrderLaw’s Order, and Future Imperfect, will speak at the Cato Institute on Tuesday, November 29, at noon. His topic will be "The Market for Law." Is there a market for good law? Without the state providing law, could it be offered by multiple, private, and competing agencies? David Friedman, professor of law at Santa Clara University, explored this idea in his classic 1973 book, The Machinery of Freedom: Guide to a Radical Capitalism. But in the years since, he's revised and strengthened some of his theories. In this talk, he will offer these new ideas from the last 30 years of thinking about the market for law. David Friedman is always interesting and provocative. Register now! And note: because of our ongoing expansion project, this event will be held one block east of Cato at the Undercroft Auditorium, 900 Massachusetts Ave. NW. Read more about David Friedman at

Posted on November 17, 2011  Posted to Cato@Liberty

Another Shoe Drops: Solyndra Layoff Was Delayed until after Election Day

The Solyndra story just keeps unfolding. Even as Secretary Chu tells NPR that "no decision we made in the loan program had anything to do with who is investing in this company," today's papers report that the Energy Department pressured Solyndra not to announce impending layoffs until the day after the crucial 2010 election. From the Washington Post:
The Obama administration, which gave the solar company Solyndra a half-billion-dollar loan to help create jobs, asked the company to delay announcing it would lay off workers until after the hotly contested November 2010 midterm elections that imperiled Democratic control of Congress, newly released e-mails show.... A Solyndra investment adviser wrote in an Oct. 30, 2010, e-mail — without explaining the reason — that Energy Department officials were pushing “very hard” to delay making the layoffs public until the day after the elections. The announcement ultimately was made on Nov. 3, 2010 — immediately following the Nov. 2 vote.
More than a month ago, I listed some of the earlier shoes in the unfolding story. But as a friend of mine asks about the Penn State scandal, is this the "other shoe," or is this story a centipede with lots more shoes to come? Jerry Taylor and Peter Van Doren ignored the politics and looked at the economics of Solyndra and energy subsidies in Forbes.

Posted on November 16, 2011  Posted to Cato@Liberty

Panel 4: A Non-prohibitionist Way Forward for U.S. and International Drug Policy

Posted on November 15, 2011  Posted to Cato@Liberty

About David Boaz

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