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  • Author: Patrick J. Michaels, David E. Wojick
  • Publication Date: 04-2015
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The purpose of this report is to provide a framework for doing research on the problem of bias in science, especially bias induced by Federal funding of research. In recent years the issue of bias in science has come under increasing scrutiny, including within the scientific community. Much of this scrutiny is focused on the potential for bias induced by the commercial funding of research. However, relatively little attention has been given to the potential role of Federal funding in fostering bias. The research question is clear: does biased funding skew research in a preferred direction, one that supports an agency mission, policy or paradigm? Federal agencies spend many billion dollars a year on scientific research. Most of this is directly tied to the funding agency mission and existing policies. The issue is whether these financial ties lead to bias in favor of the existing policies, as well as to promoting new policies. Is the government buying science or support?
  • Topic: Government
  • Author: George Selgin
  • Publication Date: 03-2015
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Not long ago a colleague of mine, who works regularly with legislators, attended a conference at which the lunch speaker, a famous economist, began by telling everyone why governments regulate financial institutions. The reasons the economist gave consisted of various (supposed) financial-market failures. Said the colleague to me later: “I just wanted to stand up and shout, 'That's got nothing to do with it!'” I relate this because some readers may otherwise fail to appreciate the importance of a work whose chief revelation is that financial legislation — and consequently the general structure of financial systems — are shaped by politics. My colleague didn't need to be told, but others, including many economists, evidently do. In Fragile by Design: The Political Origins of Banking Crises Scarce Credit, Charles Calomiris and Stephen Haber tell them. Banking arrangements, they argue, are “not a passive response to some efficiency criterion but rather the product of political deals that determine which laws are passed” (pp. 13 and 38). What's more, the laws such deals give rise to are, more often than not, detrimental to bank safety and soundness. In few words, banking instability has its roots, not in any fragility inherent to commercial banking, but in deals struck between governments and various interest groups. Fragile by Design is at once an alternative interpretation of the history of banking and a contribution to the debate on the causes of the recent crisis. Though other reviewers have tended to focus their attention on the latter contribution, many of Fragile by Design's most important insights, as well as many of its more serious flaws, are independent of its take on the subprime crisis. It is to those insights and flaws that I wish to draw attention
  • Topic: Government
  • Author: Michael B. Rappaport
  • Publication Date: 01-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The constitutional amendment procedure of Article V is defective because the national convention amendment method does not work. Because no amendment can be enacted without Congress's approval, limitations on the federal government that Congress opposes are virtually impossible to pass. This defect may have prevented the enactment of several constitutional amendments that would have constrained Congress, such as amendments establishing a balanced budget limitation, a line-item veto, or congressional term limits. The increasingly nationalist character of our constitutional charter may not be the result of modern values or circumstances, but an artifact of a distorted amendment procedure. Article V should be reformed to allow two-thirds of the state legislatures to propose a constitutional amendment which would then be ratified or rejected by the states, acting through state conventions or state ballot measures. Such a return of power to the states would militate against our overly centralized government by helping to restore the federalist character of our Constitution. Moreover, a strategy exists that would allow this reform to be enacted.
  • Topic: Civil Society, Government, Law Enforcement, Law
  • Political Geography: United States
  • Author: Michael F. Cannon, Diane Cohen
  • Publication Date: 06-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: When a member of Congress introduces legislation, the Constitution requires that legislative proposal to secure the approval of the House of Representatives, the Senate, and the president (unless Congress overrides a presidential veto) before it can become law. In all cases, either chamber of Congress may block it.
  • Topic: Government, Politics, Governance, Law
  • Political Geography: United States
  • Author: Randal O'Toole
  • Publication Date: 06-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Streetcars are the latest urban planning fad, stimulated partly by the Obama administration's preference for funding transportation projects that promote "livability" (meaning living without automobiles) rather than mobility or cost-effective transportation. Toward that end, the administration wants to eliminate cost-effectiveness requirements for federal transportation grants, instead allowing non-cost-effective grants for projects promoting so-called livability. In anticipation of this change, numerous cities are preparing to apply for federal funds to build streetcar lines.
  • Topic: Economics, Environment, Government, Political Economy, Infrastructure
  • Political Geography: United States
  • Author: Thomas L. Hogan
  • Publication Date: 06-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Privately issued money can benefit consumers in many ways, particularly in the areas of value stability and product variety. Decentralized currency production can benefit consumers by reducing inflation and increasing economic stability. Unlike a central bank, competing private banks must attract customers by providing innovative products, restricting the quantity of notes issued, and limiting the riskiness of their investing activities. Although the Federal Reserve currently has a de facto monopoly on the provision of currency in the United States, this was not always the case. Throughout most of U.S. history, private banks issued their own banknotes as currency. This practice continues today in a few countries and could be reinstituted in the United States with minimal changes to the banking system.
  • Topic: Economics, Government, Markets, Monetary Policy
  • Political Geography: United States
  • Author: Trevor Burrus
  • Publication Date: 05-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Public broadcasting has been in critics' crosshairs since its creation in 1967. Assailed from all sides with allegations of bias, charges of political influence, and threats to defund their operations, public broadcasters have responded with everything from outright denial to personnel changes, but never have they squarely faced the fundamental problem: government-funded media companies are inherently problematic and impossible to reconcile with either the First Amendment or a government of constitutionally limited powers.
  • Topic: Government, Communications, Mass Media, Law
  • Political Geography: United States
  • Author: Morris A. Davis
  • Publication Date: 05-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: For decades U.S. housing policy has focused on promoting homeownership. In this study, I show that the set of policies designed to further homeownership has been ineffective and expensive and that homeownership as a public policy goal is not well supported.
  • Topic: Economics, Government, Markets, Urbanization
  • Political Geography: United States
  • Author: Randal O'Toole
  • Publication Date: 05-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Although gasoline taxes have long been the main source of funding for building, maintaining, and operating America's network of highways, roads, and streets, the tax is at best an imperfect user fee. As such, Congress and the states should take action to transition from gas taxes to more efficient vehicle-mile fees.
  • Topic: Economics, Government, Communications, Infrastructure
  • Political Geography: United States
  • Author: Michael Tanner
  • Publication Date: 04-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: News that the poverty rate has risen to 15.1 percent of Americans, the highest level in nearly a decade, has set off a predictable round of calls for increased government spending on social welfare programs. Yet this year the federal government will spend more than $668 billion on at least 126 different programs to fight poverty. And that does not even begin to count welfare spending by state and local governments, which adds $284 billion to that figure. In total, the United States spends nearly $1 trillion every year to fight poverty. That amounts to $20,610 for every poor person in America, or $61,830 per poor family of three.
  • Topic: Economics, Government, Poverty
  • Political Geography: United States, America
  • Author: Patric H. Hendershott, Kevin Villani
  • Publication Date: 03-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The current narrative regarding the 2008 systemic financial system collapse is that numerous seemingly unrelated events occurred in unregulated or underregulated markets, requiring widespread bailouts of actors across the financial spectrum, from mortgage borrowers to investors in money market funds. The Financial Crisis Inquiry Commission, created by the U.S. Congress to investigate the causes of the crisis, promotes this politically convenient narrative, and the 2010 Dodd-Frank Act operationalizes it by completing the progressive extension of federal protection and regulation of banking and finance that began in the 1930s so that it now covers virtually all financial activities, including hedge funds and proprietary trading. The Dodd-Frank Act further charges the newly created Financial Stability Oversight Council, made up of politicians, bureaucrats, and university professors, with preventing a subsequent systemic crisis.
  • Topic: Economics, Government, Markets, Global Recession, Financial Crisis
  • Political Geography: United States
  • Author: Jagadeesh Gokhale
  • Publication Date: 11-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Official federal budget accounts are constructed exclusively in terms of current cash flows – receipts from taxes and fees and outlays on purchases and transfers. But cash-flows do not reveal economically relevant information about who benefits and who loses from government policies. Cash flows also do not reveal how changes in government's policies redistribute resources within and across generations, including reducing the tax burden on today's generations and increasing it on future ones. Because most government transact ions are targeted by age and gender, the federal government can bring about large resource transfers across generations. Intergenerational resource transfers will grow larger as the composition of budget receipts and expenditures changes with relatively faster growth of age-and-gender-related social insurance program. Intergenerational redistributions across generations through federal government operations could substantially affect different generations' economic expectations and choices and exert powerful long-term effects on economic outcomes.
  • Topic: Economics, Government, Health, Human Welfare, Markets, Monetary Policy
  • Political Geography: United States
  • Author: Alan Reynolds
  • Publication Date: 10-2012
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: This paper confirms recent studies which find little or no sustained increase in the inequality of disposable income for the U.S. population as a whole over the past 20 years, even though estimates of the top 1 percent's share of pretax, pretransfer (market) income spiked upward in 1986-88, 1997-2000 and 2003-2007.
  • Topic: Economics, Government, Markets, Social Stratification
  • Political Geography: United States
  • Author: Marcus E. Ethridge
  • Publication Date: 01-2011
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: In the wake of the 2010 elections, President Obama declared that voters did not give a mandate to gridlock. His statement reflects over a century of Progressive hostility to the inefficient and slow system of government created by the American Framers. Convinced that the government created by the Constitution frustrates their goals, Progressives have long sought ways around its checks and balances. Perhaps the most important of their methods is delegating power to administrative agencies, an arrangement that greatly transformed U.S. government during and after the New Deal. For generations, Progressives have supported the false premise that administrative action in the hands of experts will realize the public interest more effectively than the constitutional system and its multiple vetoes over policy changes. The political effect of empowering the administrative state has been quite different: it fosters policies that reflect the interests of those with well organized power. A large and growing body of evidence makes it clear that the public interest is most secure when governmental institutions are inefficient decisionmakers. An arrangement that brings diverse interests into a complex, sluggish decisionmaking process is generally unattractive to special interests. Gridlock also neutralizes some political benefits that producer groups and other well-heeled interests inherently enjoy. By fostering gridlock, the U.S. Constitution increases the likelihood that policies will reflect broad, unorganized interests instead of the interests of narrow, organized groups.
  • Topic: Democratization, Government, Politics, Power Politics, Governance
  • Political Geography: United States, America
  • Author: Jagadeesh Gokhale
  • Publication Date: 01-2011
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Unless repeal attempts succeed, the Patient Protection and Affordable Care Act of 2010 (ObamaCare) promises to increase state government obligations on account of Medicaid by expanding Medicaid eligibility and introducing an individual health insurance mandate for all US citizens and legal permanent residents. Once ObamaCare becomes fully effective in 2014, the cost of newly eligible Medicaid enrollees will be almost fully covered by the federal government through 2019, with federal financial support expected to be extended thereafter. But ObamaCare provides states with zero additional federal financial support for new enrollees among those eligible for Medicaid under the old laws. That makes increased state Medicaid costs from higher enrollments by "old-eligibles" virtually certain as they enroll into Medicaid to comply with the mandate to purchase health insurance. This study estimates and compares potential increases in Medicaid costs from ObamaCare for the five most populous states: California, Florida, Illinois, New York, and Texas.
  • Topic: Government, Health, Markets, Health Care Policy
  • Political Geography: United States, New York, California, Florida
  • Author: Jagadeesh Gokhale
  • Publication Date: 10-2011
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Social Security is often described as a "foundational" element of the nation's social safety net. Almost all Americans are directly affected by the program and many millions primarily depend on its benefits for supporting themselves during retirement. But the program's financial condition has worsened considerably since the last recession, which began in 2007. In that year, the Social Security trustees estimated that the program's trust fund would be exhausted by 2042. The trustees' annual report for 2011 brings the trust fund exhaustion date forward to 2038. Indeed, the programs revenues fell short of its benefit expenditures in 2010 and it appears unlikely that significant surpluses will emerge again under the program's current rules. If the program's finances continue to worsen at this rate, it won't be long before the debate on reforming the program assumes an urgency and intensity similar to that during 1982-83, when imminent insolvency forced lawmakers to implement payroll tax increases and scale back its benefits.
  • Topic: Economics, Government, Human Welfare
  • Political Geography: America, Ethiopia
  • Author: Michael F. Cannon, Aaron Yelowitz
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: In 2006, Massachusetts enacted a sweeping health insurance law that mirrors the legislation currently before Congress. After signing the measure, Gov. Mitt Romney (R) wrote, "Every uninsured citizen in Massachusetts will soon have affordable health insurance and the costs of health care will be reduced." But did the legislation achieve these goals? And what other effects has it had? This paper is the first to use Current Population Survey data for 2008 to evaluate the Massachusetts law, and the first to examine its effects on the accuracy of the CPS's uninsured estimates, self-reported health, the extent of "crowd-out" of private insurance for both children and adults, and in-migration of new Massachusetts residents.
  • Topic: Government, Health, Privatization
  • Political Geography: United States
  • Author: Michael F. Cannon
  • Publication Date: 01-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: House and Senate Democrats have produced health care legislation whose mandates, subsidies, tax penalties, and health insurance regulations would penalize work and reward Americans who refuse to purchase health insurance. As a result, the legislation could trap many Americans in low-wage jobs and cause even higher health-insurance premiums, government spending, and taxes than are envisioned in the legislation.
  • Topic: Government, Health, Privatization
  • Political Geography: United States, America
  • Author: Adam B. Schaeffer
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Although public schools are usually the biggest item in state and local budgets, spending figures provided by public school officials and reported in the media often leave out major costs of education and thus understate what is actually spent.
  • Topic: Economics, Education, Government, Monetary Policy
  • Author: Randal O'Toole
  • Publication Date: 03-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Over the past four decades, American cities have spent close to $100 billion constructing rail transit systems, and many billions more operating those systems. The agencies that spend taxpayer dollars building these lines almost invariably call them successful even when they go an average of 40 percent over budget and, in many cases, carry an insignificant number of riders. The people who rarely or never ride these lines but still have to pay for them should ask, “How do you define success?"
  • Topic: Government, Markets, Infrastructure
  • Political Geography: America
  • Author: Christopher J. Conover
  • Publication Date: 10-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: A well-established principle of public finance holds that taxes impose costs on society beyond the amount of revenue government collects. Estimates vary depending on the type of tax, but the “marginal excess burden” of federal taxes most likely ranges from 14 to 52 cents per dollar of tax revenue, averaging about 44 cents for all federal taxes.
  • Topic: Economics, Government, Markets
  • Political Geography: United States
  • Author: Chris Edwards
  • Publication Date: 09-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: State governments have had to make tough budget choices in recent years. Tax revenues have stagnated as a result of the poor economy, and that has prompted governors to take a variety of fiscal actions to close large budget gaps. Some governors have cut spending to balance their budgets, while others have pursued large tax increases.
  • Topic: Economics, Government, Markets, Monetary Policy
  • Political Geography: America
  • Author: George A. Selgin, Lawrence H. White, William D. Lastrapes
  • Publication Date: 11-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: As the one-hundredth anniversary of the 1913 Federal Reserve Act approaches, we assess whether the nation's experiment with the Federal Reserve has been a success or a failure. Drawing on a wide range of recent empirical research, we find the following: (1) The Fed's full history (1914 to present) has been characterized by more rather than fewer symptoms of monetary and macroeconomic instability than the decades leading to the Fed's establishment. (2) While the Fed's performance has undoubtedly improved since World War II, even its postwar performance has not clearly surpassed that of its undoubtedly flawed predecessor, the National Banking system, before World War I. (3) Some proposed alternative arrangements might plausibly do better than the Fed as presently constituted. We conclude that the need for a systematic exploration of alternatives to the established monetary system is as pressing today as it was a century ago.
  • Topic: Civil Society, Government, Markets
  • Political Geography: United States
  • Author: Andrew J. Coulson
  • Publication Date: 10-2010
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: School voucher and education tax credit programs have proliferated in the United States over the past two decades. Advocates have argued that they will enable families to become active consumers in a free and competitive education marketplace, but some fear that these programs may in fact bring with them a heavy regulatory burden that could stifle market forces. Until now, there has been no systematic, empirical investigation of that concern. The present paper aims to shed light on the issue by quantifying the regulations imposed on private schools both within and outside school choice programs, and then analyzing them with descriptive statistics and regression analyses. The results are tested for robustness to alternative ways of quantifying private school regulation, and to alternative regression models, and the question of causality is addressed. The study concludes that vouchers, but not tax credits, impose a substantial and statistically significant additional regulatory burden on participating private schools.
  • Topic: Education, Government, Markets
  • Political Geography: United States
  • Author: Randal O'Toole
  • Publication Date: 01-2009
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The Forest Service, Bureau of Land Management, National Park Service, and Fish and Wildlife Service collectivelymanagewell over a quarter of the land in theUnited States.Although everyone agrees that the landsandresourcesmanagedbytheseagencies are exceedingly valuable, the lands collectively cost taxpayers around $7 billion per year.
  • Topic: Agriculture, Civil Society, Environment, Government, Privatization
  • Author: Michael F. Cannon
  • Publication Date: 02-2009
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: President Barack Obama, former U.S. Senate majority leader Tom Daschle, and others propose a new government agency that would evaluate the relative effectiveness of medical treatments. The need for “comparative-effectiveness research” is great. Evidence suggests Americans spend $700 billion annually on medical care that provides no value. Yet patients, providers, and purchasers typically lack the necessary information to distinguish between high- and low-value services.
  • Topic: Economics, Government, Health, Privatization
  • Political Geography: United States
  • Author: Vern McKinley, Gary Gegenheimer
  • Publication Date: 04-2009
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: A financial-institution bailout involves government intervention through a transaction or forbearance targeted to a financial institution or group of financial institutions. The action is preemptive as the financial institution does not fail and go out of business, but remains a going concern, benefiting creditors, shareholders, or counterparties. In the absence of a bailout, the financial institution would either be forced to go through receivership or bankruptcy in the prescribed legal form, or have its role in financial intermediation disrupted.
  • Topic: Economics, Government, Political Economy, Privatization
  • Political Geography: United States
  • Author: Michael Tanner
  • Publication Date: 05-2009
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: President Obama has made it clear that reforming the American health care system will be one of his top priorities. In response, congressional leaders have promised to introduce legislation by this summer, and they hope for an initial vote in the Senate before the Labor Day recess.
  • Topic: Government, Health
  • Political Geography: United States
  • Author: Michael Tanner
  • Publication Date: 09-2009
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Although neither the House nor the Senate passed a health care bill by President Obama's August deadline, various pieces of legislation have made it through committee, and they provide a concrete basis for analyzing what the proposed health care reform would and would not do. Looking at the various bills that are moving on Capitol Hill, we can determine the following: Contrary to the Obama administration's repeated assurances, millions of Americans who are happy with their current health insurance will not be able to keep it. As many as 89.5 million people may be dumped into a government-run plan. Some Americans may find themselves forced into a new insurance plan that no longer includes their current doctor. Americans will pay more than $820 billion in additional taxes over the next 10 years, and could see their insurance premiums rise as much as 95 percent. The current health care bills will increase the budget deficit by at least $239 billion over the next 10 years, and far more in the years beyond that. If the new health care entitlement were subject to the same 75-year actuarial standards as Social Security or Medicare, its unfunded liabilities would exceed $9.2 trillion. While the bills contain no direct provisions for rationing care, they nonetheless increase the likelihood of government rationing and interference with how doctors practice medicine. Contrary to assertions of some opponents, the bills contain no provision for euthanasia or mandatory end-of-life counseling. The bills' provisions on abortion coverage are far murkier.
  • Topic: Government, Health, Human Welfare, Markets
  • Political Geography: United States, America
  • Author: Jagadeesh Gokhale, Peter Van Doren
  • Publication Date: 10-2009
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Many commentators have argued that if the Federal Reserve had followed a stricter monetary policy earlier this decade when the housing bubble was forming, and if Congress had not deregulated banking but had imposed tighter financial standards, the housing boom and bust—and the subsequent financial crisis and recession—would have been averted. In this paper, we investigate those claims and dispute them. We are skeptical that economists can detect bubbles in real time through technical means with any degree of unanimity. Even if they could, we doubt the Fed would have altered its policy in the early 21st century, and we suspect that political leaders would have exerted considerable pressure to maintain that policy. Concerning regulation, we find that the banking reform of the late 1990s had little effect on the housing boom and bust, and that the many reform ideas currently proposed would have done little or nothing to avert the crisis.
  • Topic: Economics, Government, Markets, Financial Crisis
  • Political Geography: United States
  • Author: Jim Harper
  • Publication Date: 03-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: In last summer's debate over immigration reform, Congress treated a national electronic employment eligibility verification (EEV) system as a matter of near consensus. Intended to strengthen internal enforcement of the immigration laws, electronic EEV is an Internet-based employee vetting system that the federal government would require every employer to use.
  • Topic: Economics, Government, Politics
  • Political Geography: United States
  • Author: Michael Tanner
  • Publication Date: 03-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Critics of the U.S. health care system frequently point to other countries as models for reform. They point out that many countries spend far less on health care than the United States yet seem to enjoy better health outcomes. The United States should follow the lead of those countries, the critics say, and adopt a government- run, national health care system.
  • Topic: Government, Health
  • Political Geography: United States, Europe
  • Author: Randal O'Toole
  • Publication Date: 05-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Federal law requires metropolitan planning organizations in urban areas of more than 50,000 people to write long-range (20- to 30- year) metropolitan transportation plans and to revise or update those plans every 4 to 5 years. A review of plans for more than 75 of the nation's largest metropolitan areas reveals that virtually all of them fail to follow standard planning methods. As a result, taxpayers and travelers have little assurance that the plans make effective use of available resources to reduce congestion, maximize mobility, and provide safe transportation facilities.
  • Topic: Civil Society, Development, Government
  • Political Geography: United States
  • Author: Andrew J. Coulson
  • Publication Date: 07-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: In this paper we estimate the budgetary impact of the Cato Institute's Public Education Tax Credit model legislation on five states and presents a generalized spreadsheet tool (“the Fiscal Impact Calculator”) that can estimate the program's effect on any other state for which the necessary input data are supplied. It is estimated that, in its first 10 years of operation, savings from the PETC program would range from $1.1 billion for South Carolina to $15.9 billion for Texas. Illinois, Wisconsin, and New York are estimated to enjoy 10-year savings within that range.
  • Topic: Education, Government
  • Political Geography: United States, New York
  • Author: Ira T. Kay, Steven Van Putten
  • Publication Date: 09-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The economic slowdown and the active political season are generating calls for imposing new regulations on executive pay. The presidential candidates of the two major parties have lashed out at what they perceive to be excessive pay for certain executives or for corporate executives in general.
  • Topic: Economics, Government, Markets
  • Author: Andrew J. Coulson
  • Publication Date: 09-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Would large-scale, free-market reforms improve educational outcomes for American children? That question cannot be answered by looking at domestic evidence alone. Though innumerable “school choice” programs have been implemented around the United States, none has created a truly free and competitive education marketplace. Existing programs are too small, too restriction laden, or both. To understand how genuine market forces affect school performance, we must cast a wider net, surveying education systems from all over the globe. The present paper undertakes such a review, assessing the results of 25 years of international research comparing market and government provision of education, and explaining why these international experiences are relevant to the United States.
  • Topic: Economics, Education, Government, Markets
  • Political Geography: United States
  • Author: Andrew J. Coulson
  • Publication Date: 09-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Would large-scale, free-market reforms improve educational outcomes forAmerican children?That question cannot be answered by looking at domestic evidence alone. Though innumerable “school choice” programs have been implemented around theUnited States, none has created a truly free and competitive education marketplace. Existing programs are too small, too restriction laden, or both. To understand how genuine market forces affect school performance, wemust cast a wider net, surveying education systems from all over the globe. The present paper undertakes such a review, assessing the results of 25 years of international research comparing market and government provision of education, and explaining why these international experiences are relevant to theUnited States.
  • Topic: Education, Government
  • Political Geography: United States
  • Author: Shirley Svorny
  • Publication Date: 09-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: In the United States, the authority to regulate medical professionals lies with the states. To practice within a state, clinicians must obtain a license from that state's government. State statutes dictate standards for licensing and disciplining medical professionals. They also list tasks clinicians are allowed to perform. One view is that state licensing of medical professionals assures quality. In contrast, I argue here that licensure not only fails to protect consumers from incompetent physicians, but, by raising barriers to entry, makes health care more expensive and less accessible. Institutional oversight and a sophisticated network of private accrediting and certification organizations, all motivated by the need to protect reputations and avoid legal liability, offer whatever consumer protections exist today. Consumers would benefit were states to eliminate professional licensing in medicine and leave education, credentialing, and scope-of-practice decisions entirely to the private sector and the courts. If eliminating licensing is politically infeasible, some preliminary steps might be generally acceptable. States could increase workforce mobility by recognizing licenses issued by other states. For mid-level clinicians, eliminating education requirements beyond an initial degree would allow employers and consumers to select the appropriate level of expertise. At the very least, state legislators should be alert to the self-interest of medical professional organizations that may lie behind the licensing proposals brought to the legislature for approval.
  • Topic: Government, Health
  • Political Geography: United States
  • Author: Chris Edwards
  • Publication Date: 10-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Revenue poured into state governments as the U.S. economy expanded between 2003 and 2007, prompting the nation's governors to expand state budgets and offer the occasional tax cut. But now that the economy has slowed and revenue growth is down, governors are taking various actions to close rising budget deficits.
  • Topic: Government
  • Political Geography: United States
  • Author: Timothy B. Lee
  • Publication Date: 11-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: An important reason for the Internet's remarkable growth over the last quarter century is the “end-to-end” principle that networks should confine themselves to transmitting generic packets without worrying about their contents. Not only has this made deployment of Internet infrastructure cheap and efficient, but it has created fertile ground for entrepreneurship. On a network that respects the end-to-end principle, prior approval from network owners is not needed to launch new applications, services, or content.
  • Topic: Government, Science and Technology
  • Political Geography: United States
  • Author: Richard L. Gordon
  • Publication Date: 12-2008
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Many politicians and pundits are panicked over the existing state of the oil and gasoline markets. Disregarding past experience, these parties advocate massive intervention in those markets, which would only serve to repeat and extend previous errors. These interventionists propose solutions to nonexistent problems.
  • Topic: Energy Policy, Government, Markets
  • Political Geography: United States
  • Author: Jacques Chaoulli
  • Publication Date: 05-2006
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Early efforts by Western democracies to restrict freedom of contract were rationalized on the ground that such restrictions were necessary to prevent the suffering of ordinary citizens. People who oppose the freedom to opt out of state-run health insurance schemes turn that rationale on its head: they oppose freedom of contract even when it is necessary to prevent the suffering of ordinary citizens. A recent ruling by the Canadian Supreme Court has helped to restore that freedom and the right of patients to make their own medical decisions.
  • Topic: International Relations, Foreign Policy, Government, International Law
  • Political Geography: Canada
  • Author: Michael Tanner, Jagadeesh Gokhale
  • Publication Date: 01-2006
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: There is growing bipartisan recognition that the pathway out of poverty is not through consumption but through saving and accumulation. That idea has led to a number of interesting and innovative experiments by state and local governments and by private charitable organizations and has helped fuel the drive for personal accounts as part of Social Security reform.
  • Topic: Conflict Resolution, Security, Development, Economics, Government
  • Author: Stephen A. Moses
  • Publication Date: 09-2005
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Seventy-seven million aging baby boomers will sink America's retirement security system if we don't take action soon. A few years ago, the problem went unrecognized by most Americans. Today, the prospect of a fiscal crisis has forced policymakers to focus on solutions.
  • Topic: Economics, Government, Human Welfare
  • Political Geography: United States, America
  • Author: Michael F. Cannon
  • Publication Date: 08-2005
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Medicaid occupies a special place among government programs for the poor. Public support for Medicaid is broader and deeper than for other safety net programs because the consequences of inadequate medical care can be much more immediate and severe than those of a lack of money or even food.
  • Topic: Economics, Government, Human Welfare
  • Political Geography: United States
  • Author: Chris Edwards
  • Publication Date: 02-2005
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: President Bush has established an advisory panel to study federal tax reform options. The panel is headed by former senators Connie Mack of Florida and John Breaux of Louisiana. Congressional leaders, including House Speaker Dennis Hastert and Majority Leader Tom Delay, have also pledged their support for reform.
  • Topic: Development, Economics, Government
  • Political Geography: United States, Florida, Louisiana
  • Author: Ilya Somin
  • Publication Date: 02-2005
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The Fifth Amendment and most state constitutions prohibit government from condemning private property except for a “public use.”Traditionally, that has forbidden most condemnations that transfer property from one private owner to another.
  • Topic: Development, Economics, Government
  • Political Geography: United States
  • Author: Michael A. Einhorn, Bill Rosenblatt
  • Publication Date: 02-2005
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The term “peer to peer” (P2P) refers generally to software that enables a computer to locate a content file on another networked device and copy the encoded data to its own hard drive. P2P technology often attracts people who use it to reproduce or distribute copyrighted music and movies without authorization of rights owners. For that reason, the short history of P2P technology has been one of constant controversy and calls by many in the content industry to regulate or even ban P2P-based networks or software.
  • Topic: Development, Government, Science and Technology
  • Political Geography: United States
  • Author: John C. Goodman
  • Publication Date: 01-2005
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Almost everyone agrees that the U.S. health care system is in dire need of reform. But there are differing opinions on what kind of reform would be best. Some on the political left would like to see us copy one of the government-run “single-payer”systems that exist in Western Europe, Canada, and New Zealand, among other places. Proponents of socialized medicine point to other countries as examples of health care systems that are superior to our own. They insist that government will make health care available on the basis of need rather than ability to pay. The rich and poor will have equal access to care. And more serious medical needs will be given priority over less serious needs.
  • Topic: Government, Human Welfare, Politics
  • Political Geography: United States, Europe, Canada, New Zealand
  • Author: Gary Wolfram
  • Publication Date: 01-2005
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: As Congress debates the reauthorization of the Higher Education Act, it should heed Friedrich Hayek's warning that democracy is “peculiarly liable, if not guided by accepted common principles, to produce over-all results that nobody wanted.” One result of the federal government's student financial aid programs is higher tuition costs at our nation's colleges and universities. Basic economic theory suggests that the increased demand for higher education generated by HEA will have the effect of increasing tuitions. The empirical evidence is consistent with that—federal loans, Pell grants, and other assistance programs result in higher tuition for students at our nation's colleges and universities.
  • Topic: Economics, Education, Government
  • Political Geography: United States
  • Author: Peter Van Doren, Jerry Taylor
  • Publication Date: 11-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Electric utility restructuring was initiated in the 1990s to remedy the problem of relatively high electricity costs in the Northeast and California. While politicians hoped that reform would allow low-cost electricity to flow to highcost states and that competition would reduce prices, economists wanted reform to eliminate regulatory incentives to overbuild generating capacity and spur the introduction of real-time prices for electricity.
  • Topic: Economics, Energy Policy, Government, Politics
  • Political Geography: California
  • Author: Jenifer Zeigler
  • Publication Date: 10-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: In 1996 the Personal Responsibility and Work Opportunity Reconciliation Act was signed into law, and the nation waited to see if welfare reform would truly “end welfare as we know it.” Block grant funding and administrative devolution gave the states a chance to move beyond pilot programs and prove that they could transition people off welfare more efficiently and effectively than the federal government. As a result, caseloads have dropped by more than half.
  • Topic: Economics, Government, Human Welfare
  • Political Geography: United States
  • Author: Lawrence J. White
  • Publication Date: 10-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) are the two dominant entities in the secondary residential mortgage markets of the United States. They are an important and prominent part of a larger mosaic of extensive efforts by governments at all levels to encourage the production and consumption of housing.
  • Topic: Economics, Government, Industrial Policy
  • Political Geography: United States
  • Author: Christopher J. Conover
  • Publication Date: 10-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Students of regulation have known for decades that the burden of regulation on the U.S. economy is sizable, with the latest figures suggesting this cost may approach $1 trillion in 2004. Surprisingly, given that the health industry is often viewed as among the most heavily regulated sectors of the U.S. economy, previous estimates generally have ignored the cost of regulating health care services.
  • Topic: Economics, Government, Human Welfare
  • Political Geography: United States
  • Author: Ilya Somin
  • Publication Date: 09-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Democracy demands an informed electorate. Voters who lack adequate knowledge about politics will find it difficult to control public policy. Inadequate voter knowledge prevents government from reflecting the will of the people in any meaningful way. Such ignorance also raises doubts about democracy as a means of serving the interests of a majority. Voters who lack sufficient knowledge may be manipulated by elites. They may also demand policies that contravene their own interests.
  • Topic: Government, Human Rights, Politics
  • Political Geography: United States
  • Author: John Samples
  • Publication Date: 09-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Critics of American politics and elections often focus on low voter turnout in the United States. They argue that voter turnout is steadily declining largely because of voter cynicism caused by big money campaigns and negative political advertising. Voter turnout is lower than it was in the 1960s, but almost the entire decline happened between 1968 and 1974. Sophisticated and detailed studies of both public trust in government and the consequences of political advertising show that neither factor has a negative effect on voter turnout.
  • Topic: Government, Human Rights, Politics
  • Political Geography: United States, America
  • Author: Jim Harper
  • Publication Date: 08-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Properly defined, privacy is the subjective condition people experience when they have power to control information about themselves. Because privacy is subjective, government regulation in the name of privacy can only create confidentiality or secrecy rules based on politicians' and bureaucrats' guesses about what "privacy" should look like. The most important, but elusive, part of true privacy protection is consumers' exercise of power over information about themselves. Ultimately, privacy is a product of personal responsibility and autonomy.
  • Topic: Government, Human Rights
  • Author: Neal McCluskey
  • Publication Date: 07-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Since the 1965 passage of the Elementary and Secondary Education Act, which concentrated unprecedented authority over American education in the hands of the federal government, federal lawmakers have passed increasingly restrictive laws and drastically escalated education spending, which ballooned from around $25 billion in 1965 (adjusted for inflation) to more than $108 billion in 2002.
  • Topic: Economics, Education, Government
  • Political Geography: United States, America
  • Author: Alan Reynolds
  • Publication Date: 06-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The federal government's swing from budget surpluses to budget deficits has raised concerns about possible negative economic effects. Some economists have argued that deficits will raise interest rates, reduce economic growth, increase trade deficits, and possibly create a financial crisis.
  • Topic: Debt, Economics, Government
  • Political Geography: United States
  • Author: Chris Edwards
  • Publication Date: 06-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The federal government is headed toward a financial crisis as a result of chronic overspending, large deficits, and huge future cost increases in Social Security and Medicare. Social Security and Medicare would be big fiscal challenges even if the rest of the government were lean and efficient, but the budget is littered with wasteful and unnecessary programs.
  • Topic: Conflict Resolution, Economics, Government
  • Political Geography: United States
  • Author: Robert A. Levy, Michael I. Krauss
  • Publication Date: 04-2004
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Critics of federal tort reform have usually come from the political left and its allies among the trial lawyers, who favor a state-based system that can be exploited to redistribute income from deep-pocketed corporations to "deserving" individuals. We offer a totally different criticism—constitutional in origin—that embraces the need for reform but reaffirms this principle: The existence of a problem, however serious, does not justify federal remedies outside the scope of Congress's enumerated powers.
  • Topic: Conflict Resolution, Government, Nationalism
  • Political Geography: United States
  • Author: Veronique de Rugy, Richard W. Rahn
  • Publication Date: 10-2003
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Global economic growth and personal freedom are under attack by governments and international organizations seeking to squelch financial privacy and tax competition. Privacy rights and international tax competition are beneficial constraints on the monopoly power of governments. But high-tax nations and organizations such as the European Union are pressing for international agreements to remove those limits on government power at the expense of prosperity and freedom.
  • Topic: Economics, Government, International Organization
  • Political Geography: United States, Europe
  • Author: William D. Hartung
  • Publication Date: 08-1999
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The defense and foreign aid budgets are the largest single source of government funding for private corporations. More than half of U.S. weapons sales are now being financed by taxpayers instead of foreign arms purchasers. During fiscal year 1996 (the last year for which full statistics are available), the government spent more than $7.9 billion to help U.S. companies secure just over $12 billion in agreements for new international arms sales. The annual $7.9 billion in subsidies includes taxpayer-backed loans, grants, and government promotional activities that help U.S. weapons makers sell their products to foreign customers. Also, the provision of low-cost facilities and extensive subsidies for research and development and mergers and acquisitions to major contractors fosters a “risk-free” environment in which weapons makers have little economic incentive to produce effective systems at affordable prices. Furthermore, a portion of the $120 billion the Pentagon spends each year on contracts with U.S. defense contractors is being wasted on defense pork—that is, redundant or unneeded weapons systems. Such subsidies and spending for defense pork can interfere with the fulfillment of legitimate security needs.
  • Topic: Defense Policy, Arms Control and Proliferation, Climate Change, Government, Industrial Policy
  • Political Geography: United States
  • Author: Kurt Schuler, George A. Selgin
  • Publication Date: 06-1999
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: On August 17, 1998, Russia devalued the ruble and stopped payment on its government debt, creating a financial crisis that continues today. Some observers have blamed the financial crisis, and the poor performance of the Russian economy generally, on government policies that they claim are rigidly laissez faire. However, a closer look at the Russian financial system reveals that it remains fundamentally socialist, though it has superficial capitalist features.
  • Topic: Debt, Economics, Government, Financial Crisis
  • Political Geography: Russia, Europe, Asia
  • Author: L. Jacobo Rodriguez
  • Publication Date: 04-1999
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: The privatization of Mexico's government-run pay-as-you-go social security system, which went into effect in July 1997, is the Ernesto Zedillo administration's most important structural reform. It is a measure that, if successful, will help bring much-needed social and economic stability. The Mexican peso crisis of 1994–95 underscore d the fragility of Mexico's economy, its need for independent institutions, and its need for a large pool of long-term domestic savings. An increase in the rate of private savings in Mexico, which this reform will promote, would make the Mexican economy less dependent on short-term fluctuations of international capital flows and, thus, more stable. More important still, the privatization of social security will erect one of the basic pillars of a free society by turning Mexico into a country of property-owning workers.
  • Topic: Economics, Government, International Political Economy, Privatization
  • Political Geography: Latin America, Mexico
  • Author: Cato Institute
  • Publication Date: 04-1998
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: On December 8-9 the Cato Institute and The Economist cosponsored a conference on the global public pensions crisis at the Queen Elizabeth II Conference Centre in London. Among the speakers were Michael Tanner, director of the Cato Project on Social Security Privatization; Clive Crook, deputy editor of The Economist; Carlos Boloña, former finance minister of Peru; Mukul Asher of the University of Singapore; and Peter Ferrara, chief economist at Americans for Tax Reform and an associate policy analyst at the Cato Institute. Excerpts from their remarks follow.
  • Topic: Economics, Government, International Political Economy
  • Political Geography: London
  • Author: Jonathan D. Wallace
  • Publication Date: 02-1998
  • Content Type: Working Paper
  • Institution: The Cato Institute
  • Abstract: Under the legal doctrine of pervasiveness, media such as television and radio get much less protection from censorship than do print media. The Supreme Court should reject the pervasiveness doctrine as a dangerously broad and vague excuse for speech regulation. If the doctrine applies to any medium, it could arguably apply to all media. The pervasiveness doctrine thus threatens to curtail the First Amendment's protection of freedom of speech.
  • Topic: Government, Industrial Policy, Political Economy, Science and Technology