You are browsing the archive for 2013 August 26.

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Mark DeWeaver on the Skyscraper index in China

August 26, 2013 in Economics

By Mises Updates

In today’s Mises Daily article, “A Skyscraper Curse with Chinese Characteristics,” Mark DeWeaver discusses the economic situation in China, and moves on to discuss the likelihood of an economic crisis:

Mises Institute: There is a great deal of confusion concerning the Chinese economy and its trade and monetary policy and mystery concerning its ability to generate double-digit rates of economic growth. Let us start by giving us a description of the Chinese economy and whether it is socialism or capitalism at work.

DeWeaver: China has well-developed product markets but can hardly be called capitalist, given that most of the means of production are at least partially state owned.At the same time, the Chinese economy has also never really been centrally planned. Most economic decision making takes place at the local-government level, much as was the case during the Maoist period. The system might be best described by the seeming double oxymoron, capitalism with limited private ownership, socialism with limited planning.

Read the full interview.

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Source: MISES INSTITUTE

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U.S. Policies Deter Inward and Encourage Outward Business Investment

August 26, 2013 in Economics

By Daniel J. Ikenson

Daniel J. Ikenson

The capacity of the United States to continue to be a magnet for both foreign and domestic investment is largely a function of its advantages, many of which are shaped by public policy. Considerations of taxes, regulations, trade openness, access to skilled workers, infrastructure, energy policy, and dozens of other policy matters factor into decisions about whether, where, and how much to invest.

It should be of major concern that inward FDI [foreign direct investment] has been erratic and relatively downward trending in recent years, but why that is the case should not be a mystery. U.S. scores on a variety of renowned business surveys and investment indices measuring policy and perceptions of policy suggest that the U.S. business environment is becoming increasingly less hospitable.

Although some policy makers recognize the need for reform, others seem to be impervious to the investment-repelling effects of some of the laws and regulations they create. Some see the shale gas and oil booms as more than sufficient for overcoming policy shortcomings and attracting the necessary investment.

The most naive consider “American” companies to be tethered to the U.S. economy and obligated to invest and hire in the United States, regardless of the quality of the business and policy environments. They fail to appreciate that increasingly transnational U.S.-based businesses are not obligated to invest, produce, or hire in the United States.

Dan Ikenson is director of Cato’s Herbert A. Stiefel Center for Trade Policy Studies.

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Source: OP-EDS

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Senator Leahy to Hold Congressional Hearing on Conflicting Marijuana Laws, Reiterates Call for Federal Government to Respect States' Marijuana Reforms

August 26, 2013 in PERSONAL LIBERTY

By drosenfeld

Attorney General Eric Holder and Deputy AG James Cole Invited to Testify

Statement from Drug Policy Alliance Executive Director Ethan Nadelmann

Senate Judiciary Committee Chairman Patrick Leahy (D-VT) announced Monday that he will address discrepancies between federal and state marijuana laws in an upcoming hearing on September 10. Leahy has invited Attorney General Eric Holder and Deputy Attorney General James Cole to testify. Twenty states now allow medical marijuana, and Colorado and Washington recently became the first two states to approve the legal regulation of marijuana for non-medicinal purposes.

August 26, 2013

Drug Policy Alliance

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Source: DRUG POLICY

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Yes, Ted Cruz Can be President

August 26, 2013 in Economics

By Ilya Shapiro

Ilya Shapiro

As we head into a potential government shutdown over the funding of Obamacare, the iconoclastic junior senator from Texas — love him or hate him — continues to stride across the national stage. With his presidential aspirations as big as everything in his home state, by now many know what has never been a secret: Ted Cruz was born in Canada.

(Full disclosure: I’m Canadian myself, with a green card. Also, Cruz has been a friend since his days representing Texas before the Supreme Court.)

But does that mean that Cruz’s presidential ambitions are gummed up with maple syrup or stuck in snowdrifts altogether different from those plaguing the Iowa caucuses? Are the birthers now hoist on their own petards, having been unable to find any proof that President Obama was born outside the United States but forcing their comrade-in-boots to disqualify himself by releasing his Alberta birth certificate?

No, actually, and it’s not even that complicated; you just have to look up the right law. It boils down to whether Cruz is a “natural born citizen” of the United States, the only class of people constitutionally eligible for the presidency. (The Founding Fathers didn’t want their newly independent nation to be taken over by foreigners on the sly.)

What’s a “natural born citizen”? The Constitution doesn’t say, but the Framers’ understanding, combined with statutes enacted by the First Congress, indicate that the phrase means both birth abroad to American parents — in a manner regulated by federal law — and birth within the nation’s territory regardless of parental citizenship. The Supreme Court has confirmed that definition on multiple occasions in various contexts.

There’s no ideological debate here: Harvard law professor Laurence Tribe and former solicitor general Ted Olson — who were on opposite sides in Bush v. Gore among other cases — co-authored a memorandum in March 2008 detailing the above legal explanation in the context of John McCain’s eligibility. Recall that McCain — lately one of Cruz’s chief antagonists — was born to U.S. citizen parents serving on a military base in the Panama Canal Zone.

In other words, anyone who is a citizen at birth — as opposed to someone who becomes a citizen later (“naturalizes”) or who isn’t a citizen at all — can be president.

So the one remaining question is whether Ted Cruz was a citizen at birth. That’s an easy one. The Nationality Act of 1940 outlines which children become “nationals and citizens of the United States …read more

Source: OP-EDS

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Credibility over 'Red Lines' No Reason for War

August 26, 2013 in Economics

By Benjamin H. Friedman

Benjamin H. Friedman

Support is gathering in Washington for military action in Syria. The rationale is as follows: Evidence that Bashar al-Assad’s forces used chemical weapons means President Obama’s “red line” has been crossed, and the U.S. must prove its credibility on the international stage by responding. In addition, we’re told, humanitarianism compels us to defend the rebels and their supporters from the Syrian government’s forces.

Neither argument is a good reason to launch cruise missiles, airstrikes or any other sort of war.

U.S. leaders obsess over credibility because of our many commitments to defend places where our interests are few. Because our forces are not infinite, the U.S. is like a bank vulnerable to a run. One failure can launch a self-fulfilling prophecy of doubt. Therefore the U.S. must always show resolve, otherwise the dominos might fall: allies will lose faith and enemies will be emboldened.

One problem with this logic is that it lacks limits. No conflict is so remote that no foreign policy pundit has called it a vital test of U.S. resolve. Take Libya, for instance, which the Obama administration justified bombing partly as a demonstration that it would help the Syrian resistance.

If our credibility was so fragile, its protectors would oppose military commitments where U.S. interests are shaky. If U.S. credibility to defend Berlin from the Soviets during the Cold War was vulnerable to failure elsewhere, we should have avoided imperiling it by fighting a useless war in Vietnam. Likewise, fighting in Syria might undermine the war weary public’s limited support for fighting somewhere else, harming credibility. The fact that credibility is always a pro-war argument shows that it is mainly a justification for war, not its motivation.

That is why airstrikes are unlikely to end the clamor about U.S. credibility. A volley of cruise missiles or conventional bombs will not win the war, but it will embroil us more deeply in it. Those that would fight now for credibility will then advocate the military escalation needed to achieve victory.

In this case, of course, it is too late to keep U.S. credibility out of it. You might agree that the president’s red-line comment was foolish — that willingness to protect civilians should not depend on the means of their murder — but still think that, once the President said what he did, proven chemical weapons use compels military action.

But foolish words do not justify foolish actions. The larger problem with …read more

Source: OP-EDS

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How Well Do State Education Departments Report Public School Spending?

August 26, 2013 in Economics

Public schools are usually the most costly item in state and local budgets. Yet despite tremendous and persistent spending growth in the last half-century, the public vastly underestimates the true cost of public education. To better understand the source of this misperception, a new Cato report examines the spending data that all 50 state education departments make available to the public and assigns summary grades on financial transparency for state department of education websites. It reveals that very few state education departments provide complete and timely financial data that is understandable to the general public.

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Source: CATO HEADLINES