Imprisoning the Messenger

Those behind the prosecution of the Planned Parenthood/StemExpress sting videographers might be surprised by the stunning parallels with an earlier case: that of pioneering investigative journalist William T. Stead, imprisoned for exposing the horrors of human trafficking of girls into forced prostitution more than 130 years ago.

Snead was drawn into the anti-trafficking crusade by Bramwell Booth, son and successor to Salvation Army founder William Booth, and his wife Florence. Girls as young as 12 or 13 were routinely lured into the sex trade by ads for domestic service, as well as sold to procurers by their parents. Thousands of young English girls were routinely bought and sold for brothels worldwide, and while Florence had been saving girls individually, the Booths realized that to stop the trade they would need powerful allies.

Booth turned to his friend William T. Snead, the crusading editor of the influential Pall Mall Gazette. Snead hatched a plot to buy a girl to show how easily and commonly it was done.

When approached through an intermediary-procurer, the alcoholic mother of 13-year old Eliza Armstrong readily agreed to sell her daughter for £5.

Eliza was taken to a midwife/abortionist to have her virginity attested, and then turned over to her “purchaser,” Snead. Snead immediately gave her into the custody of Booth, and she was sent into protective hiding with a Salvationist family in France.

Snead launched a series of articles blasting trafficking of young girls into prostitution, including full details of its practice and an anonymized account of his purchase of Eliza, The Maiden Tribute of Modern Babylon:

The “Maiden Tribute” was an instant hit. While W.H. Smith & Sons, who had a monopoly on all the news stalls, refused to sell the paper due to its lurid and prurient content, volunteers consisting of newsboys and members of the Salvation Army took over distribution.

And so the uproar began. Politicians and the public were in full force, decrying the practice of child prostitution and calling for new legislation.

Other newspapers, including the venerable Times, attached the messenger, Snead, quickly uncovering the fact that he was the anonymous purchaser portrayed in the series.

And so Snead, Bramwell Booth, the procurer, and the midwife were brought before the court on charges of the assault and abduction of Eliza Armstrong. Snead was convicted on technical grounds that he had failed to first secure permission for the “purchase” from the girl’s father, and served three months in prison.

Last year, David Daleiden and Sandra Merritt set out to expose using today’s investigative journalism tactics the unholy trade between Planned Parenthood and StemExpress in unborn baby body parts. The videos they released included lurid details, including shots of the actual body parts in Planned Parenthood’s labs, officials and technicians describing on video the process of Planned Parenthood providing specific body parts to order, and Stem Express’s website interface through which purchasers of body parts could place an order including specifying age of the fetus from which parts were obtained, with prices ranging up to $25,000 for fetal liver cells.

As the videos were released, and the public and politicians raised an uproar to defund Planned Parenthood and investigate the practices portrayed, newspapers such as the venerable New York Times were quick to dismiss them, instead attacking the messengers.

And so last week Daleiden and Merritt turned themselves into authorities in Texas here they face felony charges of tampering with a governmental record (using false drivers license to hide their real identities) carrying up to 20 years in prison, and misdemeanor charges related to purchasing human organs.

As for the “rest of the story” of Snead and Eliza Armstrong: Snead went down on the Titanic, and George Bernard Shaw was inspired by the story of Eliza in writing his Pygmalion, later adapted as the musical comedy, My Fair Lady. You may recall Eliza’s drunken father selling her to Professor Higgins. Apparently a drunken father is funnier than a drunken mother.

Section 1332, Where Are You?

ACA plansPeople are starting to get excited about another Obamacare work-around: The section 1332 waiver. This refers to a section of Obamacare that allows states great flexibility in how they deliver Obamacare within their borders. The curious thing about section 1332 waivers is that they can only be issued as of January 1, 2017.

Why? Why not allow states to get section 1332 waivers as of October 2010, when Obamacare’s first regulations took effect? Or January 2014, when the gushers of tax credits began to flow through the exchanges? Who knows? Maybe the administration just thought they needed a few years for the cement around Obamacare to solidify.

Newt Gingrich and Tom Daschle have co-authored a report on how states can use section 1332 waivers to execute policy preferences either to the left or the right of Obamacare. Anne Phelps of Deloitte & Touche LLP has also written a report describing the benefits of using a section 1332 waiver.

Both clarify that section 1332 waivers have their limits: They cannot increase the federal debt, reduce comprehensiveness or affordability from the Obamacare status quo ante, or reduce the number of people covered.


No, Senator Sanders, the Fed Was Always a Creature of Cronyism

fedReforming the Federal Reserve can brighten the future of American democracy—but unless the reforms reflect an understanding of how and why our central bank was created, the Fed will continue to serve the interests of the privileged few at the expense of the rest of us. Regrettably, presidential candidate Bernie Sanders’ misunderstandings about the origin of our central bank could steer the public away from supporting the most badly needed changes and make a bad thing worse.

In his letter to the New York Times on Dec. 23, Sanders claims that the Federal Reserve is “an institution that was created to serve all Americans (which) has been hijacked by the very bankers it regulates.”

“Hijacked” is misleading terminology. The Fed was created on behalf of bankers seeking government favors. Sanders unwittingly propagates the myth that it was created to “serve all Americans.”

More than a century ago, advocates for the creation of a central bank told the American public that the Federal Reserve Act of 1913 would take away control of the money supply from the big banks and give it to the people. To win support, they spread the slogan, “Break the grip of the money (banking) trusts.” Once the Act was made law, the public was told to expect “maximum employment, stable prices, and moderate long-term interest rates.”


Ted Cruz and Health Reform

TedcruzSenator Ted Cruz has won the Iowa Republican caucuses. Over the weekend, Chris Wallace of Fox News challenged Sen. Cruz on his proposal “to sell health insurance across state lines,” citing my argument that federal action to mandate this would be ineffective. The argument in question appeared in an op-ed in The Hill last October, although I have made it previously elsewhere.

In fact, Sen. Cruz’s proposal to sell health insurance across state lines does not appear in his presidential campaign platform. It is in a Senate bill he proposed last March, in anticipation of the Supreme Court’s decision in King v. Burwell. That case was decided last summer in favor of the Obama administration. If it had gone the other way, Obamacare would have collapsed in most of the states (which have federally facilitated health insurance exchanges, i.e.

Few politicians in Congress prepared for this possibility. Sen. Cruz and a handful of his colleagues did. However, the Supreme Court got the case wrong, so any pressure on the administration to change Obamacare through legislation evaporated.


Mandated Paid Maternity Leave...Again.

momTime recently published an article discussing the ever-debated issue of mandated paid maternity leave. The article’s author, Belinda Luscombe, titled her article, “Please Stop Acting as if Maternity Leave is a Vacation.”

Included with the article were the standard statistics. The United States is the only OECD country to not offer guaranteed paid leave, etc. etc. But she added some additional “arguments” as well.

She discussed how many individuals reacted to Obama’s recent announcement that he would sign a memorandum offering federal employees a minimum of six weeks paid leave when a child arrives. She noted that many people stated something along the following lines, “if people want to have kids, we, the taxpayers, shouldn’t have to pay for their time off.” She describes such responses as “juvenile.”

She continues on, pointing out that the survival of our species depends on people having children and that family leave is, alas, not a vacation. She concludes her article by stating that “yes, parents choose to have children. But they’re doing it for all of us, like jury duty, or being the designated driver....they’re taking one for the team.”


Reflections on National School Choice Week

School Choice Week - 2016Last week was National School Choice Week, with more than 16,000 events from coast to coast shining a spotlight on effective education options for students.

Today, parental choice in education encompasses a variety of education options:

Eight states and the District of Columbia allow parents to enroll their children in any public school they wish, regardless of where they live.

Another 43 states and DC allow public charter schools. Altogether more than 6,700 charter schools enroll over 3 million students.

Public magnet schools, 3,200 nationwide, enroll over 2.6 million students in all 50 states and DC.

Parental choice in education also includes a growing number of private and online learning options as well:

Fully 27 states and DC offer private school parental choice programs, including publicly-funded voucher scholarships, privately-funded tax-credit scholarships, tax credits, and tax deductions. These programs are helping more than 1.2 million students and their families nationwide.


On Her 111th Birthday, Ayn Rand on Individual Rights, Liberty, and Government

AynRandFew people have been more controversial than Alisa Rosenbaum. But few have heard that name, because the apoplectic responses are reserved for the new name she gave herself after she left Russia for America—Ayn Rand.

Some people are devotees of everything Rand. Others use her name as a pejorative. Still others find some of her ideas insightful while rejecting others (e.g., philosophers who reject naturalism/atheism as incoherent, de-humanizing and self-refuting (see here, here, here, and here); Christian/theist libertarians who base their views on natural law and reject her philosophy, lifestyle and insistence on atheism; “anarcho-capitalists” who reject Rand’s “minarchism;” libertarians who reject the pro-warfarism of many of her followers (see here, here, and here); and others who reject Rand for creating a cult). Yet Rand’s influence is undeniable. She sold over 30 million books, and decades after her 1982 death, hundreds of thousands more annually. In a 1991 survey by the Library of Congress and the Book-of-the-Month Club, Atlas Shrugged was ranked behind only the Bible as the book that most influenced readers’ lives. (Incidentally and for the record, the libertarian-themed novels by Christian, natural-law authors C.S. Lewis and J.R.R. Tolkien have each sold over 150 million copies.)


Obamacare’s Cost per Beneficiary Explodes with Shrinking Enrollment

23131672_MThe Congressional Budget Office’s latest budget estimate shows Obamacare’s costs per beneficiary have exploded, as enrolment in Obamacare’s broken exchanges collapses. January’s update estimates 2016 exchange enrolment at 13 million people (p. 69). Although the president’s administration had previously downgraded its estimate of Obamacare enrolment, this is the first significant change by the non-partisan CBO.

As recently as March 2015, CBO was still assuming 21 million enrollees in Obamacare’s exchanges this year (Table 2). In the January update, it has changed its estimate only for 2016 enrollment, not for future years. Next March’s update will include a more thorough analysis including future years, and we can expect those estimates to be similarly downgraded.

What is shocking, however, is that the January update still estimates that tax credits, which subsidize insurers participating in exchanges, will cost taxpayers $56 billion this year (p. 182). That amounts to about $4,308 per enrollee (although not all are subsidized). Back in March 2010, CBO estimated that 21 million people would be covered in exchanges in 2016, for a total cost of $59 billion in tax credits (pp. 20-23). That would amount to about $2,810 per enrollee.


The Truth about Tesla Motors

Tesla Model S

Tesla Model S

During a January 19th panel discussion at the Federal Trade Commission (FTC), Tesla Motors general counsel Todd Maron said: “We make money from one thing: car sales and car sales alone.” In reality, electric vehicle (EV) manufacturer Tesla Motors loses more than $4,000 on every car it sells on a “full-cost” basis (keep in mind that some of Tesla’s costs are heavily subsidized). Tesla’s losses per vehicle are even greater using generally accepted accounting principles. CNBC and Reuters explained:

Tesla reports its finances in a different way from the Detroit automakers. Using the generally accepted accounting principles, or GAAP, used by GM or Ford, Tesla’s operating losses per vehicle have steadily widened to $14,758 from $3,794 in the second quarter of 2014.

Tesla, instead, largely survives on government handouts.

In 2015, Tesla delivered 50,580 cars worldwide, with 25,700 going to U.S. customers. This is a trivial percentage of both the worldwide and U.S. auto markets. A record 17.5 million passenger vehicles were bought in the United States in 2015. Yet only 0.67 percent—or 116,548 vehicles—were all-electrics or plug-in hybrids, 6,500 fewer than in 2014. EVs account for 0.16 percent of the 250 million U.S. passenger vehicles on the road. The market for electric cars is trivial, despite massive government support.

Instead of making money from car sales, Tesla survives by participating in many government subsidy programs. One lucrative program is California’s zero-emission vehicle (ZEV) credit program. Phil Kerpen explained how the program works:

ZEV credits are a mandate dreamed up by the bureaucrats at the California Air Resources Board (CARB), which requires [auto] manufacturers to build and dealers to sell an arbitrary number of “zero-emission” vehicles each year. . . . Tesla’s Model S generates four credits per unit sold. This means the company can sell $20,000 in ZEV credits to other [auto] manufacturers for each Model S sold—a cost borne by purchasers of other cars.

ZEV credits, pioneered in California, have spread to nine other states. Tesla has collected more than $517 million from competing automakers by selling ZEV credits to those who fail to sell enough zero-emissions cars to meet arbitrary mandates.


Alcohol Prohibition and the Rise of KY Meth Labs

methSeveral months ago, I wrote on the decline in the number of meth labs in the United States. While many cheered at the news, I argued that economics, as it so often does, should lead us to be skeptical of the story. A decrease in the number of meth labs in the U.S. does not at all imply a decrease in meth use. As I discussed, many users have simply turned to substitutes. As opposed to buying more expensive domestic drugs, many users now obtain their methamphetamine from cheaper Mexican suppliers.

Although the number of meth labs may be on the decline, they certainly have not disappeared. In some areas, meth continues to be manufactured at astonishing rates. My home state of Kentucky is a prime example. Between 2008 and 2009 the state saw a 73 percent increase in the number of labs.

The manufacture and use of meth has disastrous consequences for individuals, families, and whole communities. In 2009, meth labs cost the state of Kentucky some $30 million. More than 34,000 hours were spent cleaning up labs. A full quarter of all burn patients that year received their injuries as a result of meth production at an average cost of $229,000 per patient.