David Boaz

Quotations from respected sources, such as the Founders and Tocqueville and Churchill, are often apocryphal. George Washington apparently didn't say, "Government is not reason, it is not eloquence -- it is force! Like fire, it is a dangerous servant and a fearsome master." Jefferson, alas, doesn't seem to have said, "That government is best that governs least," though he certainly believed it. A tip: If you find the quote on the Internet without any source given other than the alleged speaker, then he probably didn't say it. Some quotations are hard to trace, and it's hard to prove a negative. But this month some of our national leaders have revealed that they don't know who wrote our most basic founding documents -- and neither they nor their speechwriters apparently have access to Google. At the Southern Baptist Convention two weeks ago, Secretary of State Condoleezza Rice said, "My ancestors in Mr. Jefferson's Constitution were three-fifths of a man." Then yesterday Senate minority whip Dick Durbin opposed a flag-burning amendment by saying, "In fact, [flag-burning] rarely, if ever, happens. And so why are we about to change the handiwork and fine contribution to America of Thomas Jefferson?" Wrong again. Jefferson did not write the Constitution or the Bill of Rights. He was in France during the Constitutional Convention and during the congressional debate over the Bill of Rights. As every schoolboy knows or should know, James Madison is known as the Father of the Constitution. He also introduced the Bill of Rights into the House of Representatives in 1789. So Rice and Durbin should have referred to "Mr. Madison's Constitution" and "the handiwork of James Madison." Perhaps someone should send them a Madison biography or a copy of James Madison and the Future of Limited Government.

That's the front-page headline in today's New York Times. Eric Lipton begins this way:

Among the many superlatives associated with Hurricane Katrina can now be added this one: it produced one of the most extraordinary displays of scams, schemes and stupefying bureaucratic bungles in modern history, costing taxpayers up to $2 billion. A hotel owner in Sugar Land, Tex., has been charged with submitting $232,000 in bills for phantom victims. And roughly 1,100 prison inmates across the Gulf Coast apparently collected more than $10 million in rental and disaster-relief assistance. There are the bureaucrats who ordered nearly half a billion dollars worth of mobile homes that are still empty, and renovations for a shelter at a former Alabama Army base that cost about $416,000 per evacuee. And there is the Illinois woman who tried to collect federal benefits by claiming she watched her two daughters drown in the rising New Orleans waters. In fact, prosecutors say, the children did not exist. The tally of ignoble acts linked to Hurricane Katrina, pulled together by The New York Times from government audits, criminal prosecutions and Congressional investigations, could rise because the inquiries are under way. Even in Washington, a city accustomed to government bloat, the numbers are generating amazement.

Some of us are impressed but not exactly amazed. When an institution with no incentive for cost-cutting, and little risk of anyone being fired or demoted for malfeasance, sets out to spend money on the principle “It’s going to cost whatever it’s going to cost,” then you can expect plenty of waste, fraud, and abuse. I noted last September that

Congress passed a $51.8 billion Katrina relief bill on the very day the Associated Press released a study of where the $5 billion small-business relief money after 9/11 went. It found that the funds went to a South Dakota country radio station, a Virgin Islands perfume shop, a Utah drug boutique, and more than 100 Dunkin' Donuts and Subway shops--"companies far removed from the devastation." Fewer than 11 percent of the loans went to companies in New York and Washington.

The more things change, the more they remain the same. Big boxes of government money will not be spent wisely. That's why it's a good idea to keep as many of society's resources in the private sector as possible. Private owners have incentives to cut costs, save money, and have more money to spend later. Employees of private companies know that they could be fired for waste and malfeasance, and they know that their company (or even their nonprofit) could go out of business if its costs aren't managed. Those incentives are almost entirely lacking in the government sector, where resources are acquired coercively and no one has his or her personal funds at stake. The logical result? "Breathtaking . . . stupefying . . . amazing" amounts of boondoggles and bungles.

I'm still amused at conservatives who call the Kelo decision "activist" and make it an exhibit in their jihad against "activist" judges. See the House Republicans, the Alabama Policy Institute, or the American Conservative Union. But the Kelo decision wasn't wrong because the Court was activist. It was wrong because the Court failed to actively enforce the Constitution's restrictions on government. As Richard Epstein wrote in a Wall Street Journal column, "Justice Stevens's lamentable opinion was the polar opposite of judicial activism. Indeed, it represented a deadly form of judicial deference to legislative action that makes a mockery of both the text and purposes of the 'Public Use' Clause." Of course, just to complicate the matter, one could say that a court is activist when it finds powers for government that are nowhere granted in the Constitution. In that case, the Kelo Court was activist. Read more...

June 23rd was the anniversary of the Supreme Court's infamous Kelo decision, allowing local governments to transfer property from one private owner to another so long as there is some perceived public benefit. And, of course, there always is some benefit; as Justice Sandra Day O'Connor wrote in dissent, "Nothing is to prevent the State from replacing any Motel 6 with a Ritz-Carlton, any home with a shopping mall, or any farm with a factory" — because in each such case the city would get more tax revenue, and the city council would regard that as a public benefit. On the anniversary of the decision, homeowners Susette Kelo and Pasquale Cristofaro finally settled with the city of New London on the terms of their eviction. Also on the anniversary, President Bush signed an executive order that, in the words of a Washington Post headline, "Limits Eminent-Domain Seizures." The Post and the AP should have learned by now to be more skeptical of Bush administration claims. The executive order really does very little. It says the federal government will only take property from its owners "for the purpose of benefiting the general public." But the Supreme Court has just said that virtually anything goes under that standard. Read more...

As I purchased $10 worth of trinkets at the Container Store, the clerk began the transaction by saying, "May I have your phone number?" I replied, "Uh, no." And that was that; without any objection he rang up the transaction.  One way people can protect their privacy is by saying "no" more often. Companies ask for information, but they often don't require it. A couple of years ago, a guard at the White House looked at my driver's license and told me, "You shouldn't use your Social Security number as your driver's license number." So there's another tip: ask the DMV to assign you a random number for your license. None of this, of course, will stop your bank or phone company from giving up your information when the feds ask. But there are steps everyone can take to keep our lives just a little more private.

One of the most famous documents in the history of free-trade literature is Bastiat's famous "Candlemakers' Petition." In that parody, the French economist and parliamentarian imagined the makers of candles and street lamps petitioning the French Chamber of Deputies for protection from a most dastardly foreign competitor:

You are on the right track. You reject abstract theories and have little regard for abundance and low prices. You concern yourselves mainly with the fate of the producer. You wish to free him from foreign competition, that is, to reserve the domestic market for domestic industry. We come to offer you a wonderful opportunity. . . .  We are suffering from the ruinous competition of a rival who apparently works under conditions so far superior to our own for the production of light that he is flooding the domestic market with it at an incredibly low price; for the moment he appears, our sales cease, all the consumers turn to him, and a branch of French industry whose ramifications are innumerable is all at once reduced to complete stagnation. This rival . . .  is none other than the sun.

For after all, Bastiat's petitioners noted, how can the makers of candles and lanterns compete with a light source that is totally free? Thank goodness we wouldn't fall for such nonsense today. Or would we? Last month, Sen. Hillary Rodham Clinton and nine colleagues (ranging from Barbara Boxer to Tom Coburn) endorsed a petition from — you guessed it — the domestic candlemaking industry asking the secretary of commerce to impose a 108.3 percent tariff on Chinese candle producers. Read more...

Visiting Ireland, Washington Post columnist Steven Pearlstein writes about the death of former prime minister Charles Haughey:

In recent years, Haughey's reputation has been badly tarnished by revelations that he diverted millions of dollars from party coffers to finance his lordly lifestyle, that he carried on an affair for years with a newspaper gossip columnist, that he tapped the phones of political journalists, and that he had to sell his large Georgian estate to pay more than $6 million in back taxes.

But Haughey was also "the father of the Celtic economic miracle . . . that transformed Ireland from one of the poorest countries in Europe to one of its most prosperous and dynamic." So the column raises an interesting question: Would you rather have an honest, abstemious Puritan who taxes, regulates, and plans an economy into stagnation or worse -- or a high-living, philandering cream-skimmer who transforms your economy from the world's leading exporter of talent into a Celtic tiger?

In his book Prosperity versus Planning: How Government Stifles Economic Growth, David Osterfeld discussed two kinds of corruption. As John Mukum Mbaku explains, Osterfeld "argued that in a heavily regulated economy, one can find two distinct types of corruption: 'expansive corruption,' which involves activities that improve the competitiveness and flexibility of the market; and 'restrictive corruption,' which limits opportunities for productive and socially beneficial exchange." In other words, when a trade official takes a bribe to allow imports in, or a regulator issues a business license for a piece of the action, they're making economic activity happen. But when a regulator embezzles public funds or takes a bribe to prevent a business from opening, he is reducing competition and economic activity. So the problem isn't corruption per se; it's corruption that restricts productive activity.

Haughey's case is slightly different: wiretapping journalists and evading his own taxes are not market-expanding activities. So maybe he offers the political choice in starker relief: was Ireland better off with a corrupt prime minister who kick-started economic growth than it would have been with an honest socialist who kept Ireland in poverty? I'd say so. They should have gotten Helmut Kohl to speak at his funeral. Kohl could have made his own case there: I served 16 years as German chancellor, I ended communism in East Germany and reunified the country, and along the way, to stay in power, I helped my party skim a few million off arms sales and privatization deals. Not as good a case as Haughey would have, since Haughey opened up his country's economy and improved growth, while Kohl allowed the German economy to slow and stagnate--but I'll bet a lot of Germans still think it was overall a good bargain.

Justice Anthony Kennedy is now the swing vote on a divided US Supreme Court.

A senior Republican will be running for Senate as a Democrat this November. That's good news for libertarians.

If the welfare state couldn't work in Sweden, it couldn't work anywhere.