TR: No Friend of the Constitution - Cato Institute · some 200,000 noncombatant Filipinos, ... Fiscal Policy Report Card 12 ... should reflect our values. It should

by Michae l Chapman

With corporate corruption in theheadlines and the president andCongress acting to “restore con-fidence” in markets, many con-

servatives, including President Bush, haveadopted Theodore Roosevelt, the Repub-lican “trust buster,” as a role model forthe kind of president America needs today.In August, Bush held a press conferenceon the economy with Mount Rushmore—and Roosevelt’s colossal face—in the back-ground. A three-volume biography of TRis selling well, and many in the conser-vative media constantly drop Roosevelt’sname. A reporter recently asked PresidentBush if he thought the business world todaymirrored that of TR’s presidency (1901–09)and if Bush should “respond as aggres-sively as Roosevelt did.” TR is touted asa strong, decisive leader; a war hero;and a man who seemed to embody whatAmerica was all about and ought to beagain.

Yet the facts show that President TheodoreRoosevelt didn’t care much for the Con-stitution, limited government, private prop-erty, or people who were not of white Euro-pean stock. Roosevelt was an imperialistand defender of the national interest. Andhe believed it was his job to define thatinterest. “I don’t know what the peoplethink, I only know what they should think,”said Roosevelt. The “ability to fight welland breed well” and “subordinate the inter-ests of the individual to the interests of thecommunity,” said TR, was crucial to “truenational greatness.” It seems odd, then,that conservatives view TR as a hero.But, given the neoimperialist bent of manyof today’s conservatives, perhaps TR is theman for the right to emulate. Let’s look athis record.

Roosevelt served as assistant secretaryof the Navy under President McKinley in1897. In that job, TR agitated for war withSpain. He got it, first in Cuba. He formeda cavalry unit, the Rough Riders, whichstormed up San Juan Hill in Cuba anddefeated a group of poorly equipped Cubans.Then, when Congress was in recess in thesummer of 1898, Roosevelt ordered theU.S. fleet to the Philippines. Fighting along-side nationalist guerrillas, to whom we hadpromised independence, U.S. forces suf-fered 4,000 dead and Filipino rebels 20,000dead. The war also caused the death ofsome 200,000 noncombatant Filipinos,including women and children. As Philadel-phia Ledger writer J. Franklin Bell report-ed: “Our men have been relentless; havekilled to exterminate men, women, chil-dren, prisoners and captives . . . from ladsof 10 and up, an idea prevailing that theFilipino, as such, was little better than adog. . . . Our men have pumped salt waterinto men to ‘make them talk’ . . . [then]

PolicyReportNovember/December 2002 Vol. XXIV No. 6

In This Issue

Cato at the Merc, p. 18

Michael Chapman is editorial director atthe Cato Institute. Continued on page 14

TR: No Friend of the Constitution

Crane on bold ideas 2

Cato Supreme Court Review 3

Cato Events 4

Terrorism, defense, and Iraq 8

Cato Calendar 10

EPA and the rule of law 11

Fiscal Policy Report Card 12

Walter Williams and Gary Johnson to highlight Benefactor Summit 16

New book on foreign policy 18

Cato’s intern program 19

Cato adjunct scholar Vernon L. Smith, a pio-neer in the field of exper-imental economics, discussed his work at a Cato Institute RoundtableLuncheon on Friday, October 4, just five daysbefore he was awardedthe 2002 Nobel Prize ineconomics. Smith, whospent 26 years at theUniversity of Arizonabefore moving his Economic Science Laboratory to GeorgeMason University in2001, has written forCato Journal, Regulation,and the Cato PolicyAnalysis series.

CPR Nov/Dec 2002 11/18/02 10:35 AM Page 1

Two years ago in this space, just pri-or to the 2000 elections, I wrote,“I can safely predict the percent-age of incumbents seeking reelec-

tion who will win: 98 or 99.” The actu-al percentage was 98.6. I say that, notto flaunt my perspicacity, but to makea point about what I’ll call the politi-cal pathologies that grow out of suchan uncompetitive electoral environment.When incumbency becomes an end initself—much more important than ide-ology—good government and soundpublic policy are the victims. Instead of

the fresh breeze of an open debate over policy, we end up withthe dank stillness of a faux debate.

With that happy thought in mind, I hereby offer some com-mon-sense ideas to improve the American polity.

Understand Corporate Malfeasance. The herdlike instinct thatled Congress to almost unanimously vote for the ill-conceivedSarbanes-Oxley bill threw hundreds of millions of dollars at theSecurities and Exchange Commission andcreated an oversight board for the account-ing profession. Corporate CEOs and CFOsface jail time if some smart trial lawyerconvinces a lay jury that their financialstatements were intentionally misleading.As if accounting were some kind of sci-ence. Actually, less oversight would improvethe situation. The Financial AccountingStandards Board holds an SEC-grantedmonopoly on accounting standards in theUnited States. All public companies mustcomply with FASB standards. Problem is,because the FASB is a monopoly, there is no competition in account-ing standards. Such competition would reward more transparencyand conservative standards. As it is now, every company in thenation lobbies the FASB to tweak this rule or include that regu-lation. The result? No fewer than 803 pages of the FASB stan-dards are devoted to the treatment of derivatives alone. Simpli-fy the tax code and end the FASB monopoly and we will havegone a long way toward cleaning up corporate scandals.

Get Our Troops Out of Saudi Arabia. National Security Advi-sor Condoleezza Rice likes to say that U.S. foreign policyshould reflect our values. It should. That’s why it is insane for usto have some 6,000 Air Force personnel stationed in Saudi Ara-bia, which is ruled by one of the world’s most despicable regimes.The barbaric treatment of women and the general thuggery ofthe “royal” family are bad enough. In addition, the House ofSaud is the principal funder of the radical Islamist movement,including hundreds of schools around the world—some right herein the United States—that teach hatred for our way of life. Theworld looks at our cozy relationship with this miserable regimeand thinks ill of us. If the troops are there to guarantee access

to cheap oil, then the feds need some economic lessons. What is any regime in Saudi Arabia going to do with its oil, drink it?They will sell it, and since it is a fungible commodity it doesn’tmatter to whom it is sold. Eventually our gas-guzzling SUVswill be sated.

Support Education Tax Credits. In Ohio’s Zelman case theSupreme Court approved school voucher programs. More impor-tant, they approved school choice. Vouchers are a huge improve-ment over the failed monopoly public education system we havetoday. But they do represent a threat of increased government reg-ulation of private schools that accept vouchers. Clint Bolick andothers argue persuasively that this threat is overblown, and theymay be right. But it seems clear to me that tax credit scholar-ship funds offer choice with much less risk of regulation. Thecredits have to be large and should include both individuals andcorporations. The choice of giving money to a bloated stategovernment or providing a decent education for kids is an easyone. The net result will also save the state money.

Support Social Security Choice. The Cato Institute caught someflak from friends and foes alike when we changed the name ofour Project on Social Security Privatization to the Project on Social

Security Choice. Were we selling out?Cato? No way. Of course we support SocialSecurity privatization. Always have, alwayswill. Republicans don’t want to use theword “privatization” because they’re not very good at defending the concept,to the extent they even understand it. Wechanged the name because private own-ership and choice are the key elementsof the proposal. It is those two elementsthat allowed Jose Piñera to convinceChileans in 1980 to opt for their incred-ibly successful privatization of social secu-

rity. We felt that the “choice” part of the proposal wasn’t gettingenough attention.

That said, why in the world are Republicans running awayfrom this issue? A Zogby International Poll commissioned byCato this summer showed 68 percent support for the concept!Under the current system you have no ownership of the fundsyou earn and pay to the federal government. What you get isentirely up to 535 politicians. Under a privatization plan youwould own the assets the money you earned purchased. Howdoes one lose that debate?

So, those are my thinking-outside-the-box ideas for this issueof Cato Policy Report. Common-sense suggestions to make Amer-ica a better place in which to live. Sadly, common sense doesn’tpack much punch on Capitol Hill.

—Edward H. Crane

2 • Cato Policy Report November/December 2002

President’s Message

Thinking Outside the Box

❝ The FinancialAccounting StandardsBoard holds an SEC-granted monopoly onaccounting standardsin the United States. ❞


November/December 2002 Cato Policy Report • 3

Cato Conference

Cato Launches Cato Supreme Court Review

In a better world, the Supreme Courtwould be boring. Although changing cir-cumstances might occasionally raise anovel question—what counts as an “unrea-

sonable search” on the Internet?—theCourt’s decisions would be rendered large-ly predictable by a straightforward read-ing of the Constitution’s text. In the actu-al world, of course, even legal experts famil-iar with the elaborate layers of interpre-tive theory manufactured by the Courtover the years may beunsure how those ninedice will fall in anygiven case. On Sep-tember 17, the CatoInstitute’s Center forConstitutional Studiesheld a symposium ded-icated to narrowing theyawning chasm betweenthe two worlds. The eventcelebrated both the anniver-sary of the Constitution’ssigning and, only slightlyless momentous, the releaseof the first issue of the annu-al Cato Supreme Court Review.

As editor in chief James Swanson writesin his introduction, the Cato Supreme Court

Review differs from the vast majority ofother law journals in several ways. It appearsrelatively soon after the close of the Court’sterm; is written for a general audience ofeducated readers, rather than in the arcanelanguage of lawyers; and, perhaps mostrare of all, analyzes legal decisions from aclassically Madisonian perspective, whichtakes seriously the idea that government’spowers are meant to be clearly defined and

few in number.Several speakers at the sympo-

sium summarized pieces appearingin the journal. Cato’s Roger Pilonaddressed a Takings Clause case,the subject of an article by Uni-versity of Chicago law professorRichard Epstein, in which theCourt rejected the idea thatlandowners near Lake Tahoe weredue compensation after a seriesof development moratoria pre-vented them from building ontheir land for almost twodecades. Pilon joined Epstein

in lamenting the Court’s rejec-tion of bright-line standards in favor ofvague, ad hoc balancing tests and addedhis own analysis, grounded in natural lawtheory.

Other Cato scholars who discussed theirarticles in the Cato Supreme Court Reviewincluded Swanson, Robert Levy, and Tim-othy Lynch. Levy argued that the doctrineof states’ “sovereign immunity” fromcertain lawsuits has become utterly detachedfrom the text of its constitutional source,

Continued on page 19

Cato Policy Report is a bimonthly review published by the CatoInstitute and sent to all contributors. It is indexed in PAISBulletin. Single issues are $2.00 a copy. ISSN: 0743-605X.©2002 by the Cato Institute.•Correspondence should beaddressed to Cato Policy Report, 1000 Massachusetts Ave.,N.W., Washington, D.C. 20001. •WEB SITE: www.cato.org or call202-842-0200 or fax 202-842-3490.

CATO POLICY REPORTDavid Boaz....................................................................... EditorDavid Lampo ...................................................Managing EditorAmanda Elliott .........................................................Art DirectorJulian Sanchez ..............................................Editorial Assistant

CATO INSTITUTEEdward H. Crane..........................................President and CEOWilliam A. Niskanen ...................................................ChairmanDavid Boaz .........................................Executive Vice PresidentDonald L. Beezley .........................................V. P., DevelopmentTed Galen Carpenter ...V. P., Defense & Foreign Policy StudiesJames A. Dorn ........................................V. P., Academic AffairsWilliam Erickson.................V. P., Finance and AdministrationRoger Pilon ....................................................V. P., Legal AffairsRichard Pollock ....................................V. P., Communications

Lesley Albanese..................................Director, External Affairs Virginia Anderson ....................Manager, Information Services

Radley Balko.....................................Manager, Web OperationsDoug Bandow .......................................................Senior FellowPatrick Basham.....................................................Senior FellowRichard Baumgardner................................................ControllerAndrew Biggs.........................................Social Security AnalystSusan Chamberlin..................Director, Government RelationsClyde Wayne Crews Jr...................Director, Technology StudiesVeronique de Rugy ....................................Fiscal Policy AnalystChris Edwards............................Director, Fiscal Policy StudiesIvan Eland ..............................Director, Defense Policy StudiesMarie Gryphon...................................Education Policy AnalystGene Healy ............................................................Senior EditorDaniel J. Ikenson.......................................Trade Policy AnalystElizabeth W. Kaplan...................................... Senior CopyeditorTerry Kibbe ............................................Director, DevelopmentTerri LaBonte .................................Director of AdministrationDavid Lampo ...........................................Publications DirectorCasey J. Lartigue Jr. ............................Education Policy AnalystRobert A. Levy ...............Senior Fellow, Constitutional StudiesBrink Lindsey...........Director, Center for Trade Policy StudiesTimothy Lynch ..................................Director, Criminal JusticeLaura Major ............................................Director, ConferencesThomas P. Miller.......................Director, Health Policy StudiesTom G. Palmer......................................................Senior FellowCharles V. Peña ..........................Senior Defense Policy AnalystAlan Peterson.....................................................Director of MISEvans Pierre.......................................Director of BroadcastingAlan Reynolds .......................................................Senior FellowClaudia Ringel ...........................................................CopyeditorJacobo Rodríguez ............................Financial Services AnalystDavid Salisbury ...........Director, Ctr. for Educational Freedom

John Samples ...............Director, Ctr. for Representative Govt.James L. Swanson..........Senior Fellow, Constitutional StudiesMichael Tanner...............Director, Health and Welfare StudiesJerry Taylor........................Director, Natural Resource StudiesAdam Thierer..............Director, Telecommunications StudiesPeter VanDoren ..............................................Editor, RegulationIan Vásquez ........................Director, Global Economic Liberty

James M. Buchanan......................Distinguished Senior FellowEarl C. Ravenal .............................Distinguished Senior Fellow

Randy E. Barnett ...................................................Senior FellowJames Bovard ......................................Associate Policy AnalystBarbara Conry ......................................Associate Policy AnalystLawrence Gasman...........Senior Fellow in TelecommunicationsSteve H. Hanke......................................................Senior FellowJohn Hasnas..........................................................Senior FellowPenn Jillette ......................................Mencken Research FellowDavid B. Kopel.....................................Associate Policy AnalystChristopher Layne ...........Visiting Fellow, Foreign Policy StudiesPatrick J. Michaels....Senior Fellow in Environmental StudiesStephen Moore .....................................................Senior FellowP. J. O’Rourke ..................................Mencken Research FellowTim Penny .................................Fellow in Fiscal Policy StudiesJosé Piñera..................Co-chair, Social Security PrivatizationJim Powell.............................................................Senior FellowRonald Rotunda ............Senior Fellow, Constitutional StudiesTeller.................................................Mencken Research FellowCathy Young .................................................Research Associate

A new annual review of Supreme Court decisions

James Swanson, editor in chief of the CatoSupreme Court Review, welcomes Judge DouglasGinsburg, chief judge of the U.S. Court of Appealsfor the D.C. Circuit, who delivered the first annualB. Kenneth Simon Lecture at Cato’s ConstitutionDay launch of the review.


◆ July 23: Milton Mueller, author of Rul-ing the Root: Internet Governance and theTaming of Cyberspace, had harsh wordsfor the Internet Corporation on AssignedNames and Numbers at a Cato Book Forum,“Who Rules the Root? ICANN, DomainNames, and the Battle over Internet Gov-ernance.” Mueller characterized ICANNas an unaccountable de facto regulator con-trolled by narrow interests. Harold Feld ofthe Media Access Project called it a “houseof cards,” saying that ICANN “recapitu-lates the FCC, and does it badly," but Ira

go, which he said denied U.S. resourcesto the Castro regime.

◆ July 30: Cato scholars faced down rep-resentatives from the U.S. Department ofJustice and the National Rifle Associa-tion in tag-team debate at a Cato PolicyForum, “Federalism under the Gun: Ban-ning City Lawsuits, Federalizing Gun Crime.”Andrew Hruska attempted to defend theDOJ against the charge, leveled by Catosenior editor Gene Healy, that federal pros-ecution of gun crimes is an “insultinglyunconstitutional” usurpation of state policepowers. Robert A. Levy agreed with theNRA’s Todd Adkins that lawsuits seekingto hold gun makers liable for gun crimesare frivolous but argued that it is for statecourts and legislatures, not Congress, toset the boundaries of tort liability.

◆ July 31: With Congress rushing to approvethe proposed Office of Homeland Securi-ty, a Cato Policy Forum paused to ask,“Will a New Federal Bureaucracy MakeUs More Secure?” Dave McIntyre of theANSER Institute for Homeland Securityand Michele Flournoy of the Center forStrategic and International Studies wereboth supportive of the OHS in somethinglike its proposed form, but University ofMaryland professor I.M. Destler questionedthe wisdom of uprooting parts of existingagencies and bringing them under OHSauthority. Cato’s Ivan Eland argued thatCongress should “cut before pasting, ratherthan paste before cutting” and streamlinethe relevant departments independentlybefore creating a new department.

◆ August 26: Cato’s series of Social Secu-rity University briefings on Capitol Hillbegan with a crash course in the program’shistory, structure, and fiscal problems. Atthe inaugural session of Social Security Uni-versity, “Social Security 101: The Programand the Problem,” broadcast live on C-SPAN, Cato scholars Andrew Biggs andMichael Tanner explained how the systemis funded, the formula used to calculatebenefits, the demographic trends that threat-en to bring about Social Security’s collapse,and why the trust fund will provide no aidin meeting obligations to retirees. They then

sketched the case for private accounts, show-ing how reform would return the systemto solvency while giving workers greatercontrol over their retirement income.

◆ August 27: In the second installment inCato’s Social Security University series,“Individual Accounts: Facts and Fantasy,”Andrew Biggs laid out the case for movingto a system of voluntary, privately ownedretirement accounts; defended the recom-mendations of the President’s Commissionto Strengthen Social Security, on whose staffhe served; and rebutted the major objec-tions to personal accounts. Biggs answeredconcerns about transition costs, the pro-gressivity of reform plans, and the risksof investment, as well as misleading chargesthat reform would “cut benefits.”

◆ August 28: Critics of plans to establishprivate accounts as part of Social Securityare seldom eager to offer reform propos-als of their own. In part three of Social Secu-rity University, “The Alternatives to Indi-vidual Accounts,” Michael Tanner andAndrew Biggs made the reason for thatclear by examining the most prominentalternatives to individual accounts. Tannerand Biggs summarized the plans offered byAl Gore, Rep. Peter DeFazio (D-Oreg.),Brookings Institution scholars, Rep. Robert


Cato Events

“Social Security 101” on Capitol HillDebates on terrorism insurance, Iraq, China, and more

C. Magaziner, the Clinton administration’sInternet czar, and former ICANN headMichael M. Roberts argued that ICANNhad succeeded in its primary purpose ofpreserving network stability.

◆ July 25: A member of Congress, an ambas-sador, and an expert on Cuba debated thequestion, “Will U.S. Trade with Cuba Pro-mote Freedom or Subsidize Tyranny?” ata recent Cato Policy Forum. Rep. Jeff Flake(R-Ariz.) opposed the embargo, saying thatit has allowed Castro to blame the UnitedStates for the failures of socialism. PhilipPeters of the Lexington Institute conveyedthe desire of Cuban citizens for both thejobs increased tourism would bring and theability to more easily collaborate with pro-democracy activists. Amb. Dennis K. Haysof the Cuban American National Founda-tion provided the lone defense of the embar-

Economist Anne Gron of Northwestern Universityquestioned the need for government terrorisminsurance at a Cato Policy Forum on September 23.

Cato University participants took a special tour ofGeorge Washington’s home, Mount Vernon, onJuly 31.


Matsui (D-Calif.), the National Council ofWomen’s Organizations, and several oth-er groups and pointed out that none of themfare well in comparison with personalaccounts.

◆ August 29: In the wake of recent turmoilin the market, Republicans in Congress havebeen distancing themselves from Social Secu-rity reform as frantically as investors drop-ping dot-com stocks. But pollster John Zog-by told an audience of Capitol Hill staffersduring “The Politics of Social SecurityReform” that a survey of likely voters con-ducted at one of the stock market’s lowestpoints found that 68 percent of respondents


supported plans to allow workers to investa portion of their payroll taxes.

◆ September 5: CNN’s Robert Novak mod-erated a panel discussion on the midtermelection, “Election 2002: What’s at Stake?”Expert observers Larry Sabato and RonFaucheux ran the numbers and predictedthat November would see no major pow-er shifts in Congress. Cato’s John Samplesand Patrick Basham reported that, whilepublic sentiment continued to favor small-er government, incumbents had such enor-mous advantages that this would be unlike-ly to translate into policy change or com-petitive elections. “Politicians,” in Novak’s

words, “don’t like elections. They like coro-nations.”

◆ September 9: Foreign policy experts at aCato Forum asked, “Is China’s MilitaryModernization a Threat to the UnitedStates?” Ross Munro of the Center for Secu-rity Studies said that internal Chinesemilitary documents made clear that “long-term Chinese strategy views the UnitedStates as its adversary,” a view secondedby Bernard Cole of the National War Col-lege. George Washington University’s DavidShambaugh summarized the rapid changesin China’s armed forces. Shambaugh andCole had a less pessimistic estimate of theChinese military threat than did Munro.Although Munro questions Chinese inten-tions, even he admits that militarily Chinais "far, far behind the United States.”

◆ September 10: The first in a series of CatoForums on young Americans and SocialSecurity looked at “Young Workers’ UniqueStake in Social Security Reform.” Third Mil-lennium’s Meredith Bagby and MatthewMoore of the National Center for PolicyAnalysis said that young workers, who standto lose the most as Social Security becomesinsolvent, should begin to worry about thesystem’s long-term fiscal problems. The Eco-nomic Policy Institute’s Sarah Harding, how-ever, claimed that the Social Security crisishad been exaggerated, and Shaun O’Brienof the AFL-CIO worried that reforms would“threaten the integrity” of Social Security.Cato analyst Andrew Biggs said that suchcharges were the equivalent of a “shellgame,” that critics were comparing theexpected benefits under a system of privateaccounts with the unrealizable promisesmade by the current system.

◆ September 12: A panel of experts deliv-ered the second installment in Cato’s serieson young Americans and Social Security ata briefing on Capitol Hill, “How Would thePresident’s Commission’s Plans Affect YoungerAmericans?” Detailed economic analysiswas given by Charles P. Blahous, executivedirector of the President’s Commission toStrengthen Social Security; University of Illi-nois finance professor Jeffrey Brown; Heff

P. J. O’Rourke, Cato’s Mencken

Research Fellow, speaks at a Cato

Institute reception at the Chicago

Mercantile Exchange on September 18.

At a Policy Forum onthe 2002 elections,moderator RobertNovak of CNN notedthat “politicians don’tlike elections. Theylike coronations.”

Continued on page 6

Cato senior fellowStephen Moore pres-ents an “A” grade to

Colorado Gov. BillOwens at a National

Press Club news conference to

release Cato’s sixthbiennial “Fiscal Poli-

cy Report Card onAmerica’s Gover-

nors.” Georgia Gov.Roy Barnes (left)received a “B.”


Lemieux, an economist with the Progres-sive Policy Institute; and Dartmouth Col-lege economics professor Andrew Samwick.Kent Smetters, a professor of insurance andrisk management at the Wharton School ofBusiness, delivered an extended talk in whichhe argued that both advocates and oppo-nents of reform were guilty of oversimpli-fying a complex issue.

◆ September 13: If the United States is notcareful, warned Ted Galen Carpenter at aCato Hill Briefing, the war on terror couldtransform this country into a new RomanEmpire. At “From Homeland Defense toNation Building: A Foreign Policy for aConstitutional Republic,” Carpenter stressedthe importance of resorting to militaryaction only when America’s vital interestsare at stake. Cato senior fellow Doug Bandowobserved that a long record of failure atnation building, including attempts in Haiti,Kosovo, Somalia, Lebanon, and Bosnia,was unlikely to be broken if the UnitedStates tried to occupy Iraq.

◆ September 17: This Constitution Day,the Cato Institute celebrated both the anniver-sary of the Constitution’s signing and theinaugural issue of the annual Cato SupremeCourt Review with a symposium titled “TheSupreme Court: Past and Prologue—A Lookat the October 2001 and October 2002Terms.” The first two panels discussed deci-sions from the 2001 term with implicationsfor school choice, the First Amendment,regulatory takings, federalism, the drugwar, and plea bargaining in criminal pros-ecutions. Speakers included Judge StephenF. Williams; attorney C. Boyden Gray; ACLUlegal director Arthur B. Spitzer; Dean Dou-glas Kmiec of Catholic University’s Schoolof Law; and Cato scholars James L. Swan-son, Roger Pilon, Robert A. Levy, and Tim-othy Lynch. A third panel moderated byDuke University law professor WalterDellinger summarized cases to be heard inthe coming term. The speakers were JamesBopp Jr. of the James Madison Center forFree Speech, who will lead a challenge tocampaign finance restrictions; ThomasGoldstein, who is slated to argue two cas-

es before the Court this term; and attorneyErik S. Jaffe. Following a dinner reception,Judge Douglas H. Ginsburg delivered thefirst B. Kenneth Simon Memorial Lecture.

◆ September 19: A bill sponsored by Rep.Howard Berman (D-Calif.), which wouldallow copyright owners to hack peer-to-peer networks in order to prevent tradingof their intellectual property, has provokedfierce debate among technology commen-tators. That debate continued at a CatoForum, “Copy Fights: Can Politicians orEntrepreneurs Best Protect Intellectual Prop-erty?” Alec French, counsel for the Sub-committee on Courts, the Internet and Intel-lectual Property of the House Committeeon the Judiciary, said the bill merely allowedthe online equivalent of retrieving a stolenbicycle from a thief’s front yard, a viewshared by Smith College economist JamesMiller and Troy Dow of the Motion Pic-ture Association of America. John Mitchellof Public Knowledge, attorney Phil Cor-win, and Ed Black of the Computer andCommunications Industry Association,however, said that the power granted tocopyright owners under Berman’s billwas unprecedented.

◆ September 19: At the third of Cato’sForums on young Americans and Social

Security, “Savings, Investment, and YoungAmericans,” teenaged investment writerChris Stallman of TeenAnalyst.com andAmerican Express financial adviser JonathanHarel stressed the importance of beginningto save for retirement at an early age. Jacque-line Mosso of Prudential Financial agreedand worried that young workers are notsufficiently concerned or informed aboutretirement planning. Demographics expertNeil Howe gave an overview of genera-tional trends in the United States.

◆ September 20: At a Cato Hill Briefing,two Cato scholars asked, “Would Attack-ing Iraq Increase or Decrease U.S. Securi-ty?” and concluded that it would decreaseU.S. security. Defense analyst Charles Peñastressed Iraq’s limited ability to harm U.S.interests, and Ivan Eland presented a DavidLetterman–style list of the top 10 reasonsnot to invade.

◆ September 23: George Mason Universitylaw professor Todd Zywicki and Universi-ty of Maryland economist Lawrence Ausubeldebated the merits of a proposal to makeit more difficult to declare some kinds ofbankruptcy at a Cato Forum, “Will Bank-ruptcy Reform Make the System More Equi-table and Efficient?” Zywicki voiced approvalfor reforms, saying that debt was too easi-


EVENTS Continued from page 5

Cato University participants talk

with economistWalter Williamsafter his closing

talk at the summer seminar.

At a Cato Policy ForumGlenn Hubbard, chairmanof President Bush’sCouncil of EconomicAdvisers, defended theneed for governmentreinsurance to deal withthe risk of terrorism.


ly discharged under current law, which makescredit tighter for even honest borrowers.Ausubel charged that the reform proposalwas "basically written by lobbyists for Visa"and argued that it failed to address ade-quately the most common abuses.

◆ September 23: Since September 11, 2001,insurance companies have been wary oftaking on risk associated with terroristattacks. Insurance experts considered pro-posals to have the government pick up theslack at a Cato Forum, “Insuring againstTerror: Is There a Role for GovernmentReinsurance?” Council of Economic Advis-ers chairman Glenn Hubbard was moresympathetic to the idea than was North-western University economist Anne Gronor University of South Carolina financeprofessor Scott Harrington, but all stressedthat any government insurance should beexplicitly temporary and tailored to inter-fere minimally with market solutions. DebraBallen of the American Insurance Associ-ation, however, argued that federal actionwas needed in light of state regulations thathamper private insurers.

◆ September 24: A panel of experts exam-ined the danger posed by terrorist hack-ers at the Cato Forum “Digital Pearl Har-bor: How Real Is the Cybersecurity Threat,and Who’s Responsible Anyway?” Microsoft’schief security strategist Scott Charney andIra Parker of Genuity discussed potentialthreats, offering such disturbing scenariosas hackers shutting down airport com-

munications networksor disabling phone sys-tems just before aphysical attack. Secu-rity expert WarrenAxelrod, Verisign’sKen Silva, and Don-ald A. Purdy of thePresident’s CriticalInfrastructure Protec-tion Board emphasizedthat the private sectorwas insufficiently pre-pared to deal withcyberterrorism andwould have to step upsecurity efforts if itwere to preempt poten-tially clumsy govern-ment regulation.

◆ September 24: The final installment inCato’s series of Forums on young Ameri-cans and Social Security looked at “ThePolitics of Social Security Reform.” LexPaulson of College Democrats of Ameri-ca said that confidence in markets was onthe decline, but Cato’s Andrew Biggs coun-tered that a recent Zogby poll revealedno diminution in support for private accountsamong the young. Hans Riemer of the Cam-paign for America’s Future argued that,although the issue was salient to older vot-ers, people in their 20s were unlikely tobase their votes on it. All the more reason,replied Jennifer Olson, a legislative assis-tant to Rep. Jim Kolbe (R-Ariz.), to edu-cate the young about the problems withSocial Security. Bruce Tulgan of Rainmak-er Thinking gave the keynote address, inwhich he said that, although workers intheir late 20s and early 30s were largelydistrustful of government’s promises, theiryounger siblings appear to be more trust-ing and optimistic.

◆ September 25: Genetic technologies havethe potential to revolutionize agricultureby increasing crop yields and reducingdependence on pesticides. In Europe, how-ever, there is widespread concern that so-called Frankenfoods may harm humanhealth or unbalance delicate ecosystems.At the Cato Forum, “Food Fight: The Loom-


ing U.S.-EU Conflict over Plant Biotech-nology and Trade,” Cato adjunct scholarRonald Bailey said that such fears wereutterly without scientific foundation. SarahThorn, speaking for the Grocery Manu-facturers of America, said European Unionlabeling requirements would be an undueburden on American agriculture. Alan Lar-son of the U.S. Department of State blast-ed the EU moratorium on importation ofbiotech crops as an “unlawful act” underinternational trade agreements. Despite thescientific consensus, Tony Van der haegen,who is with the Delegation of the Euro-pean Commission to the United States. not-ed that 50 percent of Europeans believethat genetically modified organisms aredangerous.

◆ September 30: The enormous politicalpower of teachers’ unions came under scruti-ny at the Cato Forum, “Schoolyard Bul-lies: How the NEA and AFT Maintain aStranglehold on Teachers and Politics.”Mark Levin of the Landmark Legal Foun-dation recounted his attempts, unsuccess-ful so far, to hold the NEA accountable foroutright lies to the IRS about its politicalspending. Education Policy Institute chair-man Myron Lieberman and Stefan Glea-son of the National Right to Work LegalDefense Foundation argued that the unionsshould be stripped of legal privileges thatsquelch competition in the market for laborrepresentation. ■

Cato vice president James A. Dorn speaks at theAsia-Pacific Democratic Cooperation Forum inTaipei in late August.

Guest speakers at the annual Cato Club 200 retreat in Carmel were UCLAprofessor Gregory Stock, author of Redesigning Humans: How TechnologyWill Redefine the Human Form and Character; Shelby Steele of the HooverInstitution, author of A Dream Deferred: The Second Betrayal of Black Free-dom in America; and J. Craig Venter, who cracked the human genome atCelera Genomics.


The Cato Institute has been holding aseries of Capitol Hill Briefings forcongressional staffers. Two recentbriefings concerned current foreign

policy issues. At “From Homeland Defenseto Nation Building: A Foreign Policy for aConstitutional Republic,” senior fellowDoug Bandow and Ted Galen Carpenter,Cato’s vice president for defense and for-eign policy studies, discussed foreign pol-icy principles and their current application.Ivan Eland, director of defense policy stud-ies at Cato, spoke at “Would AttackingIraq Increase or Decrease U.S. Security?”Excerpts from their remarks follow.

Ted Galen Carpenter: It is imperativethat we understand the propernature of our war against the peo-ple who committed the Septem-ber 11, 2001, atrocities. We needto keep our eye on the prize. Theadversary is Osama bin Laden’sal-Qaeda network and its Talibanallies. That war is not even closeto being finished, though we liketo pretend that it is.

Al-Qaeda and the Taliban havebeen badly damaged: they havebeen deprived of their base inAfghanistan. But there are al-Qae-da cells in numerous countries,and there are significant concen-trations of al-Qaeda and Talibanfighters in Pakistan. It is one ofthe bitterest ironies of this waragainst terrorism that we seemto be willing to do almost anything—go towar against Iraq, send training missions tothe Philippines and Georgia—but dis-comfort our noble ally in Pakistan, the mil-itary dictator of that country, GeneralMusharraf, by going where the Taliban andal-Qaeda are now located. Such a militarycampaign needs to be the next stage.

We must not allow the war against theSeptember 11 attackers to become an amor-phous war against terrorism per se. Thereare lots of insurgent movements in the world,and most of them, from time to time, useterrorist tactics. But they have adversariesother than the United States. The IrishRepublican Army may still be a problemfor Great Britain. The Basque separatists

may be a problem for Spain. The Kashmiriinsurgents certainly are a problem for India.The FARC rebels in Colombia are a prob-lem for that country’s government. Butthose insurgents do not generally attackAmerican targets. They are not necessari-ly our adversaries. If we declare a war onterrorism per se, we make other countries’enemies our enemies, and I would arguewe have enough enemies of our own. Wedon’t need to acquire others needlessly.

In addition, the war on terrorism shouldnot become a pretext for such things as set-tling old scores against Saddam Hussein.A war against Iraq would be a dangerousdistraction for the United States. If we goto war against Iraq, the happiest person in

the world, assuming he is still alive, wouldbe bin Laden, because we would take himout of the cross hairs and focus on Iraq andSaddam instead. And we would moveone step closer to transforming this warfrom a war against the murderers of Sep-tember 11 into a general struggle betweenthe West and the Islamic world. That isexactly what bin Laden wants.

The United States needs a new foreignpolicy of strategic independence, with onebasic principle: don’t get involved in otherpeople’s fights unless America’s own vitalinterests are at stake. In the security realm,that generally means unilateralism ratherthan multilateralism, but it does not nec-essarily foreclose multilateralism in specif-

ic instances. Strategic independence is arestrained unilateralism, in marked con-trast to the kind of muscular, belligerent,imperial unilateralism advocated by someneoconservatives and others in the UnitedStates.

Strategic independence rejects the roleof America as the world’s policeman, andit equally rejects the role of America as theworld’s social worker. It would husbandAmerica’s great economic, political, andstrategic advantages—and we have thembeyond anything any other great power inhistory could ever imagine. We ought toexploit those advantages and not wastethem frivolously.

I would also argue that strategic inde-pendence is the only foreign pol-icy consistent with the values ofa constitutional republic. Thatis a very important point. TheFounders did not design Amer-ica to be an empire, and Amer-ica is not well suited institu-tionally to being an empire. Ifwe try to play that role, we aregoing to transform this countrydomestically as well as interna-tionally, and do so in most unde-sirable ways.

The reality is that mobilizingfor war, always staying mobi-lized for war, and waging warsincessantly will have crucialdomestic consequences. Thatkind of mobilization means that,inevitably, regardless of anyone’s

intentions, power flows from the privatesector to government. Within the govern-ment sector, it flows from the state and locallevels to the federal level. And at the fed-eral level it flows from the judicial and leg-islative branches to the executive branch.That is not healthy for a pluralistic society.

We ought to make the distinction thatSecretary of State John Quincy Adams madeback in 1821 (his principles are just as appli-cable today as they were then). He empha-sized that America did not go abroad insearch of monsters to destroy, that it wasthe well-wisher to the freedom and inde-pendence of all, but it was the defender andvindicator only of its own.

Those words have been quoted on a


Policy Forum

On the Hill: Terrorism, Defense, and Iraq

Doug Bandow and Ted Galen Carpenter discuss U.S. foreign policy at aCapitol Hill Briefing on September 13.


number of occasions, but Adams had some-thing more to say. And it showed that hisprinciples and the principles of the found-ing generation and the next generation weredesigned not just for a weak America butfor a strong America as well. Adams warnedthat if we ever abandoned that distinction,America might become the “dictatress ofthe world”—it was potentially that strong—but it would no longer be the master ofits own spirit.

That is an absolutely fundamental con-sideration when we adopt a foreign poli-cy. We don’t want to transform Americainto the new Rome—-and I mean the RomanEmpire not the Roman Republic—and yet—I think we are in grave danger of doingexactly that.

Doug Bandow: U.S. leadership is inevitable.We have the largest, most productive econ-omy on earth. We have a globally domi-nant culture. We have a political philoso-phy that is enormously attractive abroad.This country is going to be a superpoweralmost in spite of itself.

Real leadership means using all of thoseattributes with discernment, carefully weigh-ing costs and benefits. It does not meanjumping into every conflict, every dispute,every source of instability and trying to“fix” it. It is particularly important to rec-ognize that 280 million Americans have nomonopoly on the knowledge and under-standing necessary to try to resolve con-flicts around the globe.

The danger of this kind of “fatal con-ceit,” which Friedrich Hayek talked about,is readily evident when it comes to domes-tic social engineering. It is even more prob-lematic when we go international. Indeed,if you start looking around the world atAmerica’s attempts at nation building, it isvery hard to find successful examples. Whenwe point to Bosnia or Haiti or Kosovo orLebanon or Somalia, where are the greatsuccesses?

In Bosnia, we have an artificial state thattwo-thirds of the people would like to leaveimmediately, a state which exists only becausewe have imposed a high representative whomakes decisions about what the flag willlook like, who decides what the nationalanthem will be, who decides on the cur-

do once the mujahideen had driven out theSoviets. Put in a major military force toimpose a central government—rather likethe Soviets had tried? That didn’t seem towork very well. Simply hand out more mon-ey to the same groups that we funded toactually drive out the Soviets? That wouldhave put more money into the hands ofradical Muslims who today are terrorists.What policy could we have conceivably fol-lowed at the end of that war to buildAfghanistan? It’s very hard to imagine.

Indeed, Afghanistan’s problems resultfrom far too much outside intervention: acoup d’état, Soviet intervention, Pakistanisupport for the Taliban, and America’s fun-neling of aid to the worst and the most rad-ical elements there. The problem was notthat we didn’t intervene enough. The prob-lem was that the United States and otheroutside powers got involved and destroyedthe domestic political process.

Terrorism can arise in two different cir-cumstances. The first is a situation of chaos,where there is simply no central power—no power to stop terrorists from being active.The second is where you have governmentsupport for terrorists, as we had with theTaliban. But of course, these are very dif-ferent circumstances. In the case of chaos,yes, terrorists can operate in that environ-



❝ U.S. leadership is inevitable. Real leadership means using our attributes with discernment, carefully weighing costs and benefits.❞

rency, who has the power tothrow out elected officials thathe doesn’t like, and whodemands that the media runvideo clips of the Americansecretary of state. Well, thatmay be democracy, but it ismore Boss Tweed democracythan anything I would care to see.

We managed to move Haitifrom military dictatorship topresidential dictatorship. InKosovo we saw a quarter ofa million Serbs, Jews, Gypsies,and even non-ethnic AlbanianMuslims ethnically cleansedafter we were technically incharge. Lebanon was a won-derful success; 241 marineswere blown up at the U.S. bar-racks. Somalia remains in chaos.Where are the successful examples of nationbuilding?

About the only places where one canargue that nation building worked in anysense are Germany and Japan. But thosecountries had been totally defeated in war,and their political leaderships had beencompletely discredited. There were signif-icant reservoirs of legal, cultural, andeconomic traditions there that could becalled upon. Those ethnically homogeneoussocieties were in fact real countries that hadhad real governments, in contrast to mostof the places around the globe where weare trying to build nations. Very few failedstates have even one of those characteris-tics, let alone all of them. To point toGermany and Japan as examples of whatAmerica could do in Iraq or in Afghanistanpoints very far afield.

Today the argument is that we need tonation build to stop terrorism. That, ofcourse, is the issue in Afghanistan. We lookat Afghanistan and say, this shows why wehave to nation build; look at what hap-pened there! But Afghanistan actually showsthe limits of nation building. There is, ofcourse, the charge that the United Statesmade a major mistake by “abandoning”Afghanistan after the Soviets were forcedfrom that country. But it is not at all clearto me what Washington was supposed to

Ivan Eland responds to a question at a Capitol Hill Briefing onSeptember 20 as senior defense policy analyst Chuck Peña anddirector of government affairs Susan Chamberlin listen.



ment, but they are also uniquely vulnera-ble. Without state support, the best answeris military action against them. Take themout. Quite bluntly, kill them.

Where you have government support,the best response is to focus on the gov-ernment with a policy of deterrence. Theruling elites in societies that support ter-rorists should understand that they willno longer be ruling elites. Certainly that’sthe lesson of Afghanistan: if you’re theTaliban and you harbor terrorists, youwill no longer rule the country. And thatis a lesson we will apply to other nations.

Unfortunately, nation building as a solu-tion may be far harder than trying to stopterrorism. Nor is nation building likely tobe sufficient to stop terrorism. Consider

the fact that al-Qaeda is estimated to beactive in 68 different countries in one formor another. Are we going to nation buildevery one of those? And how about the 42other terrorists groups that are active invarious countries? How many candidatesfor nation building do we want to take on?

I would far prefer to focus on stoppingterrorism than on nation building. Whatwe want, frankly, is victory and deterrence;we don’t want nation building. If nationbuilding is really necessary in a specificinstance, let’s do it. But that is not the goal;it’s the means. The goal has to be to stopterrorism.

Ivan Eland: An invasion of Iraq could desta-bilize several countries—Turkey, Jordan,Egypt, Kuwait, and Saudi Arabia. The rad-ical Islamic groups in those countries couldput pressure on the governments becausethe United States would be invading anoth-er Islamic country. The analysts at Catostrongly supported the war in Afghanistanbecause we felt that the United States hadbeen attacked and that we needed to takerobust military action against al-Qaeda.And there was no backlash in Afghanistanbecause, even in the Islamic world, peo-ple believe that countries do have a legiti-mate right to self-defense. In the case of anattack on Iraq, which has no demonstrat-ed link to September 11, 2001, many peo-ple would say that it is not self-defense, andI think you would see an Islamic backlashthroughout the region.

The United States put a lot of pressureon Pakistan to round up Taliban and al-Qaeda members, and justifiably so. But theleader in Pakistan is hanging on by his fin-gernails. Being allied with the United Statesis not conducive to his survival there. If theUnited States attacks another Islamic coun-try, I think he is going to face even morepressure. I think we should actually worrymore about Pakistan than Iraq, becausePakistan is very unstable and already hasnuclear weapons. And we could have anIslamic radical state with nuclear weaponsif the United States destabilizes the MiddleEast and the Central Asian region throughan invasion of Iraq.

A U.S. invasion of Iraq would not be a“preemptive attack.” The president is using

POLICY FORUM Continued from page 9

❝ An invasion of Iraq could destabilize several countries—Turkey, Jordan, Egypt, Kuwait, and Saudi Arabia. I think you

would see an Islamic backlash throughout the region.❞

that term to sell the policy, but it would bea preventive attack. A preemptive attackis what the Israelis did against the Arabsin 1967: they detected that an Arab attackwas imminent, so they attacked first to getthe advantage. In this particular case, theUnited States would be launching a pre-ventive attack, an attack to defeat a coun-try before it becomes a threat. That policyis contrary to what the Founders envisioned.They envisioned a country that wouldengage in self-defense, not adventures aroundthe world.

The U.S. military, if you read betweenthe lines of newspaper stories, has neverbeen enthusiastic about invading Iraq—first, because of the possible use of weaponsof mass destruction against our troops and,second, because of the potential for highcasualties in urban fighting. Urban fight-ing is very difficult, because ground forceshave to take built-up areas block by block,house by house. One sniper can hold upwhole units in urban areas. It is sort of likefighting in the mountains or in the jungle—the defense has a tremendous advantage.

In the urban areas, Saddam is alreadyputting his command-and-control facilitiesand military units among civilians, nearschools and hospitals. There is going to bea lot of pressure in the United States to holddown casualties of Iraqi civilians; that maybe difficult to do with airpower alone. SoI think we may have to go into urban areason the ground, and we have to ask our-selves if we are willing to do that.

Now, we hear much about Iraq’s sup-port for terrorism. And, yes, Iraq does sup-port groups that are on the U.S. terroristlist. But that list includes many groups thatdo not really focus their attacks on the Unit-ed States. Iraq has sponsored terrorismagainst Iraqi opposition figures overseasand also against groups that operate in theMiddle East. If we are talking about statesponsorship of terrorism, the number oneculprit is Iran, followed by Syria. In fact,in a number of the Bush administration’sindictments, Iraq doesn’t even bubble upto be number two. For example, NorthKorea probably already has the fissionablematerial to build two nuclear weapons, andit has a much more erratic leader than Sad-dam.

Cato Calendar

Telecom and Broadband Policy After the Market MeltdownSixth Annual Technology

& Society ConferenceWashington • Cato Institute

November 14Speakers include James Glassman,Robert Crandall, and Tom Hazlett.

New York City SeminarWaldorf-Astoria • November 15Speakers include Robert Novak

and John McWhorter.

San Diego City SeminarSan Diego Marriott & Marina

December 11Speakers include Dinesh D’Souza

and Michael Robertson.

Los Angeles City SeminarWestin Bonaventure • December 12

Speakers include Dinesh D’Souza and David Fleming.

15th Annual Benefactor SummitNaples, Florida • LaPlaya Beach Club

& Resort • February 26–March 2Speakers include Gov. Gary Johnson

and Walter Williams.



Iraq is most certainly developing weaponsof mass destruction. But according to theDepartment of Defense, there are manythreatening countries—I’m not talkingabout Britain, France, and the like—thatalready have weapons of mass destructionprograms. There are already 12 nationswith nuclear programs, 13 with biologicalweapons, 16 with chemical weapons,and 28 with ballistic missiles. So the ques-tion then becomes, whom will the UnitedStates attack after Iraq? Are we going togo after Iran?

In the very worst case, what if Sad-dam gets nuclear weapons? He was deterredfrom using weapons of mass destructionin the Gulf War by the United States andIsrael—both nuclear-armed powers—andhas been deterred ever since from usingthem against either nation. He has alsobeen deterred from giving weapons of massdestruction to Palestinian and anti-Iranianterrorist groups. Those are the terroristgroups that he supports. He has not giv-

en them such weapons, even though Israelis his archenemy. So we look at the trackrecord and we see that he has been deterreduntil now from using weapons of massdestruction against the United States orgiving them to terrorists.

There are several reasons Saddam mightnot want to give al-Qaeda weapons of massdestruction. The first is that al-Qaeda doesnot like corrupt secular regimes in the Mid-dle East, and that is a description of Sad-dam’s regime. He has realized also that theIslamic fundamentalists in Afghanistanturned against the United States after theUnited States had supported them for years.So the al-Qaeda people are very prag-matic, and he probably realizes that theycould turn on him if he gives them suchweapons.

He also doesn’t have very much ideo-logical affinity with al-Qaeda. He hasnot given weapons of mass destructionto terrorists in the past, and he has hadthem for many years; so I’m not sure what

has changed.The administration is saying that there

are al-Qaeda agents in Iraq, but they areoperating in the northern part of the coun-try, where the Kurds are in control. Ofcourse the Kurds are not behind al-Qaedaeither; I think al-Qaeda is just taking advan-tage of the fact that Saddam doesn’t con-trol that area.

The burden of proof should be on thosewho want war. The United States has deterredand contained both the Soviet Union andChina, which are much more powerful coun-tries. The United States did not preempttheir successful attempts to get nuclearweapons. Mao, when he got nuclear weaponsin the 1960s, looked pretty radical. And hewas pretty radical. But we chose to live withthat. We chose to deter and contain China.That policy worked for 40 years against asuperpower. So, even if Saddam, a dictatorin charge of a small, poor nation, shouldget a nuclear weapon—the absolute worstcase—I think he can be deterred. ■

Is EPA Enforcement Out of Control?Book charges EPA practices are incompatible with rule of law

Franz Kafka’s The Trial recounts thesurreal story of a man accused andjudged by a shadowy tribunal, fromwhich he never learns either the charge

against him or the rules by which thatstrange court operates. Had Kafka firstread the new Cato Institute book by econ-omist and Competitive Enterprise Institutefellow James V. DeLong, he might insteadhave titled his masterpiece The EPA. In Outof Bounds, Out of Control: RegulatoryEnforcement at the EPA, DeLong chargesthat the Environmental Protection Agencyis an arbitrary and unaccountable rule-making body whose enforcement proce-dures are thoroughly incompatible with therule of law.

The labyrinthine network of regulationsand “clarifications” promulgated by theEPA—sometimes comprising thousands ofpages for a single program—is so vast,vague, and complex that no firm can besure that it is in full compliance at any giv-en time, writes DeLong. When the agency’sattention is drawn to a violation, whetherfor scientific, political, or personal reasons,there is almost no way of knowing in advance

how intensely the investigation will be pur-sued or how severely the firm will be penal-ized. The same violation may be punishedin any number of ways, ranging from ver-bal warnings to criminalindictments, at the dis-cretion of EPA bureau-crats.

DeLong’s review ofsignificant court casesinvolving the agencyalso reveals that intentis irrelevant to EPAenforcement, so com-panies guilty of acci-dental procedural vio-lations are no lessliable than thosedeliberately dam-aging the environ-ment. He even cites acase in which two regional offices of theEPA interpreted the same regulation dif-ferently, leaving a firm open to penalty whenit trusted the assurances of the less restric-tive office that it was exempt. In anotherinstance, the agency attempted to stretch

its authority under a pollution controlstatute to empower itself to regulate theuse of wetlands.

Although DeLong sees no easy remedy,he advocates a return to the “nondelega-

tion doctrine,” which would requireCongress to take responsibil-ity for approving new require-ments and restrictions devel-oped by administrative agen-cies. He also endorses devolu-tion of regulatory power to states,which often have more innova-tive and effective approaches toenvironmental protection and havefrequently clashed with a hyper-active EPA determined to arrogatethat power. He predicts that thiswill happen only when industry, nowcowed by fears of bad publicity andvindictive retaliation of regulators,stands up for the rule of law and fights

back more vigorously.Out of Bounds, Out of Control is avail-

able ($16.95 cloth/$8.95 paper) from CatoInstitute Books at 1-800-767-1241 or onthe Cato website, www.cato.org. ■

Cato Book



Cato Studies

Two new Biggs papers on Social Security

In alternate years, the Cato Institute assess-es the fiscal performance of America’sstate governors using 17 objective meas-ures. The sixth such assessment, “Fiscal

Policy Report Card on America’s Gover-nors: 2002” (Policy Analysis no. 454), byStephen Moore and Stephen Slivinski, givesa grade of A for spending discipline andtax cuts to Bill Owens (R-Colo.) and JebBush (R-Fla.); Roy Barnes (D-Ga.) takesthird place with a high B. Failing gradeswere assigned to Gray Davis (D-Calif.),Don Sundquist (R-Tenn.), Bob Taft (R-Ohio), and John Kitzhaber (D-Oreg.)

◆ Benefits of Mining Regulation MostlyFool’s GoldThe Mine Safety and Health Administra-tion is often cited as proof that governmentregulatory bodies can be effective and ben-eficial. But in “Saving Lives or WastingResources? The Federal Mine Safety andHealth Act” (Policy Analysis no. 453), C.Gregory Ruffennach argues that MSHA’sreputation is based on a misleading inter-pretation of the relevant data. Ruffennachfinds that when fatality rates are measuredagainst the annual quantity of ore or coalmined, no significant change in historicaltrends is associated with changes in the law.Since regulation is both ineffective andexpensive, he recommends that governmentlet the tradeoffs individual miners makebetween wages and risk levels provide mineoperators with the appropriate incentivefor investment in safety.

◆ Being IDVoiceprints, retina scanners, face recogni-tion cameras, and other technologies tofacilitate personal identification are large-

ly innocuous in privatehands but may threatenfreedom if they are usedto aid government in com-piling databases on citi-zens. So writes ClydeWayne Crews Jr. in a newCato paper, “Human BarCode: Monitoring Bio-metric Technologies in aFree Society” (Policy

Analysis no. 452). Crews suggests that pub-lic and private databases be kept strictly

separate to prevent both the centralizationin state hands of privately gathered dataand the exploitation by private entities ofmandatory government identifiers, as hasgradually occurred with Social Securitynumbers.

◆ An Era of Irrelevant ElectionsThe sudden—and counterintuitive—rise inpublic confidence in government that fol-

lowed the September2001 terrorist attackshas all but faded, accord-ing to Cato scholars JohnSamples and PatrickBasham. In “Election2002 and the Problemsof American Democra-cy” (Policy Analysis no.451), they report that a10-year trend towardpublic preference forsmaller government,except for defense, con-tinues unabated. Direwarnings to the contrary,voter turnout, measuredas a percentage of eligi-ble voters, remains rela-tively stable. Neverthe-

less, the authors suggest, the midterm elec-tions will be minimally competitive as aresult of a welter of incumbent advantagesand an ever more brazen and cynical set ofredistricting agreements designed to pre-serve the status quo in Congress. Ultimately,they say, the elections will turn, not on anymajor policy debate, but on the ability ofthe parties to mobilize their preexistingbases of support.

◆ Yes, They Have More MoneyF. Scott Fitzgerald once wrote that the veryrich “are different from you and me,” towhich his friend Ernest Hemingway respond-ed, “Yes, they have more money.” That isthe basic message of a new Cato study, “FatCats and Thin Kittens: Are People WhoMake Large Campaign Contributions Dif-ferent?” (Cato Briefing Paper no. 76) byJohn McAdams and John C. Green. Althoughpeople who contribute large amounts topolitical campaigns are, unsurprisingly,wealthier on average than people who give

smaller amounts, contributors are other-wise surprisingly similar. Contrary to con-ventional wisdom, donors of large amountsare not overwhelmingly Republican, norare they especially opposed to liberal poli-cies. Regulatory attempts to limit largedonations, the authors conclude, are unlike-ly to significantly affect politics.

◆ Yes, Virginia, There Is a Sales Tax, andIt’s High Enough AlreadyIn a new paper, Cato’s Chris Edwards andPeter Ferrara of the Virginia Club for Growthoffer “10 Reasons to Oppose Virginia SalesTax Increases” (Cato Briefing Paper no.75). Though tax hikes of from a half per-cent to a full percent are being pitched asnecessary to meet Virginia’s transportationneeds, the authors observe that state spend-ing has been growing steadily for severalyears. Virginians should not stifle economicgrowth with a tax increase; instead, thestate legislature should rearrange its budg-et priorities.

◆ How Risky Is Your Scheme?Despite the best efforts of opponents ofSocial Security reform, a plummeting stockmarket has done little to dampen publicsupport for personal accounts. And it shouldnot, explains Social Security analyst AndrewBiggs in “Personal Accounts in a DownMarket: How Recent Stock Market DeclinesAffect the Social Security Reform Debate”(Cato Briefing Paper no. 74). As Biggsobserves, the doomsday scenarios advancedby supporters of the status quo ignore thefact that workers could, and almost cer-tainly would, make a wide variety of invest-ments, with stocks only a small part. Work-ers with less taste for risk, or nearing retire-ment, would shift to safer investments, suchas bonds or Treasury bills. Biggs empha-sizes that, although stock markets may fluc-tuate wildly from day to day, they have his-torically gained steadily over the long term.

◆ McCain-Feingold in MiniatureCentral to the debate over campaign financerestrictions has been the question of whetherthey would promote or hinder electoralcompetition. Fortunately, there is no needto speculate: state regulations provide anopportunity to test empirically the com-

Owens and Bush Top Fiscal Policy Ratings

Clyde WayneCrews Jr.

John Samples

Patrick Basham


peting claims. A case study by economistMichael J. New, “Campaign Finance Reg-ulation: Lessons from Washington State”(Cato Briefing Paper no. 73), found unam-biguous results. Washington State’s cam-paign finance laws reduced the amount ofelectoral spending, while simultaneouslyentrenching incumbents, whose nonmon-etary advantages are magnified when chal-lengers cannot neutralize them with spend-ing. In both the state house and senate,more seats were uncontested in both theprimary and general elections after the pas-sage of regulations, and more incumbentsproved able to hold their seats.

◆ Time for a Lesson in CompetitionIf monopolies are characteristically ineffi-cient, asks Myron Lieberman in “Liberat-ing Teachers: Toward Market Competitionin Teacher Representation” (Policy Analy-sis no. 450), why are we so willing to tol-erate government support of the monop-oly privileges enjoyed by the National Edu-cation Association and the American Fed-eration of Teachers? For no good reasonat all, answers Lieberman, who finds manypowerful reasons to reform collective bar-gaining laws to enable competition amongteachers’ unions. Competition, he argues,would have the usual effect of driving downprices (union dues) and would allow teach-ers who disagree with the NEA’s politicalpositions to be more effectively represent-ed. Lieberman writes that reform wouldalso be a boon to advocates of school choice,which both unions vigorously oppose.

◆ Green Arguments Unsustainable andUnderdevelopedWorld leaders gathered in Johannesburg atsummer’s end for a conference on “sus-tainable development,” but precisely whatwere they conferring about? In “Sustain-able Development: A Dubious Solution inSearch of a Problem” (Policy Analysis no.449), Cato’s director of natural resourcestudies Jerry Taylor points out that thereare more than 70 definitions of the term.If our concern is with human welfare, henotes, it is unclear why future generationsmust have access to no fewer raw, unprocessednatural resources than we now enjoy. “Howcan we be expected to know what the needs

of people in 2100 might be?” Taylor asks.On the other hand, if “sustainable devel-opment” means only that the well-being ofour descendants should not be sacrificed

for the sake of currentconsumption, there is lit-tle need for the heavy-handed governmentalsolutions advanced byadvocates of sustainability.Taylor cites a wealth ofevidence to show that byalmost any imaginableindicator—including air

and water pollution, biodiversity, humanhealth, and climate change trends—tech-nological progress and economic devel-opment, far from requiring legal restraint,typically increase sustainability.

◆ Welfare for Politicians Unnecessary andImmoralIf the pernicious influence of money cor-rupts politics, wonder many people whosupported McCain-Feingold’s regulation ofcampaign financing, why not try to displaceprivate funding of campaigns altogether?Because, says Cato scholar John Samples,state funding of campaigns will be “eitherunnecessary or immoral.” That is, taxing acitizen to subsidize a candidate she alreadysupports is redundant, and a subsidy to acandidate the taxpayer opposes is immoralbecause “individuals should not be forcedto support ideas that contravene their deep-est commitments.” In “Government Financ-ing of Campaigns: Public Choice and Pub-lic Values” (Policy Analysis no. 448), Sam-ples reviews a variety of arguments for gov-ernment funding of campaigns and findsthem wanting. Academic studies have foundlittle evidence of the sort of quid pro quothat opponents of corruption invoke, andpublic financing typically comes tied tospeech-squelching spending limits, whichinflate the nonmonetary advantages of incum-bents by making it more difficult for chal-lengers to gain as much media exposureas their opponents.

◆ How Nike (Accidentally) Saved the WorldGlobalization has benefited the rich byenabling them to exploit the developingworld. So, at any rate, goes the familiar


refrain of its opponents. But a recent Catostudy by Indur M. Goklany, “The Glob-alization of Human Well-Being” (PolicyAnalysis no. 447), finds that just the reverseis true: poor countries that open themselvesto globalization are made significantly bet-ter off by it. Goklany examined five indi-cators of human welfare: food availabili-ty, infant mortality, child labor, life expectan-cy, and the United Nations DevelopmentProgram’s human development index. Hisencouraging findings are that, as a resultof “a combination of economic growth andtechnological change, compared with thesituation half a century ago, the averageperson today lives longer and is less hun-gry, healthier, more educated, and morelikely to have children in a schoolroom thanin the workplace.”

◆ Enron’s Harmless Death StarTo the long and growing list of Enron’s sins,many observers wish to add a role in exac-erbating California’s energy crisis of 2000–01for profit. However, a new study by Catoscholars Jerry Taylor and Peter VanDorenasks, “Did Enron Pillage California?” (CatoBriefing Paper no. 72) and finds that Enron’senergy trading strategies, despite omi-nous names like “Death Star” and “GetShorty,” did not have that effect. Rather,the crisis was a product of severe weath-er, high fuel costs, and ill-considered pricecontrols. Although some of the strategiesmay have been illegal, others helped to effi-ciently allocate electricity by exploiting arbi-trage opportunities, and almost all weremade possible by ungainly political con-straints on California’s energy markets.

◆ Three Roads to ReformAs a staff member of thePresident’s Commissionto Strengthen Social Secu-rity, Andrew Biggs, nowassistant director of Cato’sProject on Social Securi-ty Choice, helped todevelop a trio of pro-posals for Social Securi-ty reform that have come

under heavy attack by defenders of the sta-tus quo. But as Biggs notes in “Perspectives

Andrew Biggs

Jerry Taylor


❝ The average person today lives longer and is less hungry, healthier, more educated, and more likely to have children

in a schoolroom than in the workplace.❞


stood them on a bridge and shot them downone by one, to drop into the water belowand float down as an example to those whofound their bullet-riddled corpses.”

Needless to say, America didn’t give thenationalists independence. McKinley jus-tified U.S. occupation by saying that it wasour duty to Christianize the Filipinos, whowere in fact mostly Catholic.

In 1900, McKinley chose Roosevelt ashis running mate and they won the elec-tion. McKinley was assassinated in 1901and TR became president. He immediate-ly embarked on various campaigns of NewImperialism and expanded the executivebranch. “I did not usurp power,” said Roo-sevelt, “but I did greatly broaden the useof executive power.” Roosevelt’s New Impe-rialism was a breed of expansionism thatviewed the world as split between civilized(developed) and uncivilized (undeveloped)nations. “Of course, our whole nationalhistory has been one of expansion,” saidTR. “That the barbarians recede or are con-quered, with the attendant fact that peacefollows their retrogression or conquest, isdue solely to the power of the mighty civ-ilized races which have not lost the fight-ing instinct, and which by their expan-sion are gradually bringing peace into thered wastes where the barbarian peoples ofthe world hold sway.” In The Winning ofthe West, TR defended Manifest Destinyin racial, Darwinian terms. It was “part ofthe order of nature” that white Europeansshould destroy Mexicans, the “natural prey”of superior Anglo-Saxons.

It was America’s duty, according to Roo-sevelt, to bring the backward nations intothe fold of democracy and Protestantism,by force if necessary. “If a nation showsthat it knows how to act with reasonableefficiency and decency in social and polit-ical matters . . . it need fear no interferencefrom the United States,” he said in his 1904annual message to Congress.

Chronic wrongdoing, or an impo-tence which results in a general loos-ening of the ties of civilized society,may in America, as elsewhere, ulti-mately require intervention by some

civilized nation, and in the WesternHemisphere the adherence of the Unit-ed States to the Monroe Doctrine mayforce the United States, however reluc-tantly, in flagrant cases of such wrong-doing or impotence, to the exerciseof an international police power . . .in regard to Cuba, Venezuela, andPanama, . . . and to secure the opendoor in China, we have acted in ourown interest as well as in the inter-est of humanity at large.

Manifest Destiny on an internationalscale. Under TR’s New Imperialism, theU.S. empire extended to the Philippines,Cuba, Haiti, the Dominican Republic, andPuerto Rico.

Executive PowerIn a 1912 campaign speech, TR trashed

the idea of limited government, saying:“This is a bit of outworn academic doc-trine. . . . It can be applied with profit, ifanywhere at all, only in a primitive com-munity such as the United States at the endof the 18th century.”

It’s no surprise then that David Brooks,senior editor of the Weekly Standard,described TR as “a fervent Hamiltonian.”Alexander Hamilton supported a central-ized state and a large federal government.TR despised Hamilton’s philosophical oppo-site, Thomas Jefferson, a defender of lim-ited government and individual rights (H.L. Mencken compared TR with Kaiser Wil-helm of Germany). Today, Sen. John McCain(R-Ariz.) labels himself a “Roosevelt Repub-lican” and praises TR as “really the firstcampaign-finance reformer” because herestricted corporate contributions to polit-ical campaigns in 1907. McCain also prais-es TR’s belief in the “necessity of using ourmilitary strength to protect democracy andfreedom” around the globe, an “interna-tional police power.”

As president, Roosevelt tried to getColombia to sign a treaty on the constructionof the Panama Canal (Panama was then aprovince of Colombia). The Colombiangovernment said no, and a group of Pana-manians, with U.S. help, declared them-selves a republic. TR sent gunboats to pro-tect the new “nation,” and shortly there-

after construction of the canal began. Lat-er boasting of his victory, TR said: “I tookPanama without consulting the Cabinet. . . .A council of war never fights, and in a cri-sis the duty of a leader is to lead.” In dis-cussing troubles in Cuba with future pres-ident William Howard Taft, Roosevelt said:“I should not dream of asking the per-mission of Congress. . . . It is for the enor-mous interest of this government to strength-en and give independence to the Executivein dealing with foreign powers.”

Roosevelt was sometimes less than can-did about his bullying view of executivepower. For instance, during the Republi-can convention of 1904, which renomi-nated TR for president, a report came inthat a chieftain named Raisuli in Moroc-co had seized Ion Perdicaris, supposedly aU.S. citizen. TR rushed American warshipsto Tangiers and told the Sultan, “Perdicarisalive or Raisuli dead.” The conventioneerspraised TR for his decisive action and hispatriotism. However, TR did not tell theconvention-goers that the State Departmenthad earlier informed him that Perdicariswas a citizen of Greece and that arrange-ments had already been made to free him.TR hoodwinked the conventioneers andthe public—and spent taxpayers’ money—for political gain.

In 1907, TR sent a U.S. naval force—the Great White Fleet—on a global tour,largely to show off America’s military pow-er, at an enormous cost to taxpayers.

The Regulatory StateRoosevelt’s program of greater central-

ization of power in Washington and in theexecutive branch took off in 1903 with thecreation of the Department of Commerceand Labor, which contained a Bureau ofCorporations to investigate corporate behav-ior. “I have always believed that it wouldalso be necessary to give the National Gov-ernment complete power over the organi-zation and capitalization of all businessconcerns engaged in inter-State commerce,”said TR. The Expedition Act also came in1903. It gave the attorney general the author-ity to place antitrust suits at the front ofcourt dockets.

In a 1911 editorial on antitrust law, TRborrowed from a “statesman . . . of the

❝ President Theodore Roosevelt didn’t care much for the Constitution, limited government, private property,

or people who were not of white European stock.❞


CONSTITUTION Continued from page 1


highest courage,” Sen. Cushman R. Davis,to explain his views on capitalism:

When Senator Davis spoke, few menof great power had the sympathy andthe vision necessary to perceive themenace contained in the growth ofcorporations. . . . He realized keen-ly . . . that we must abandon defi-nitely the laissez-faire theory of polit-ical economy, and fearlessly cham-pion a system of increased Govern-mental control paying no heed to thecries of the worthy people whodenounce this as Socialistic. He sawthat, in order to meet the inevitableincrease in the power of corporationsproduced by modern industrial con-ditions, it would be necessary toincrease in like fashion the activityof the sovereign power which alonecould control such corporations. Ashas been aptly said, the only way tomeet a billion-dollar corporation isby invoking the protection of a hun-dred-billion dollar government; inother words, of the National Gov-ernment, for no State Government isstrong enough both to do justice tocorporations and to exact justice fromthem.

Following his 1905 State of the Unionaddress, the New York World describedTR’s plans as “the most amazing pro-gram of centralization that any presidentof the United States has ever recommend-ed.” A reporter remarked that TR’s plansshowed “a marked tendency toward thecentralization of power in the United Statesand a corresponding decrease in the old-time sovereignty of the states, or of the indi-vidual.”

In 1906 came the Pure Food and DrugAct and the Meat Inspection Act. TR pushedboth laws largely in response to muckrak-ing journalists, especially the socialist UptonSinclair, author of The Jungle, a novel.Despite Sinclair’s propaganda, a govern-ment report confirmed that the novel’s claimsabout working and sanitary conditions inthe Chicago stockyards were unfounded.Roosevelt in private said of Sinclair: “I haveutter contempt for him. He is hysterical,

unbalanced, and untruthful.” Nonetheless,the muckrakers had done their job andthe meatpackers wanted to limit competi-tion. So, TR signed the Meat Inspection Act,which cost taxpayers $3 million to imple-ment. Economist Lawrence Reed reportsthat Sinclair, the socialist, despised the newlaw because he saw it for what it was, “aboon for the big meat packers.” The PureFood and Drug Act produced the Food andDrug Administration, which controls whichdrugs consumers may purchase in the mar-ket and, to some degree, at what price.

Roosevelt also pushed the Hepburn Actof 1906, which put price controls on railrates. The result was a disaster—fallingprofits, poor service, and eventually the endof private management of the railroads.

In 1908 came the National Conserva-tion Commission and the Aldrich-VreelandAct, the forerunner of the Federal Reserveand central banking, that authorized aNational Monetary Commission. TR alsopushed for graduated income and inheri-tance taxes and a “living wage.”

During his presidency, TR acted aggres-sively against private corporations and,in fact, contributed to financial panic. Before1905, for instance, only 22 antitrust caseshad been filed under the Sherman AntitrustAct. Between 1905 and 1909, that numbershot up to 39 cases, and in 1910–19, thenumber of cases was 134. As economistGeorge Bittlingmayer has documented, TR’suse of the bully pulpit and his attorney gen-eral’s attacks on business contributed tothe panic of 1903. In addition, the crusade


❝ The New York World described TR’s plans as ‘the most amazing program of centralization that any president

of the United States has ever recommended.’❞


against Standard Oil and other companiesled to the panic of 1907, “which was markedby a 50 percent decline in stock prices anda one-third decline in output over the 12months ending December 1907,” accord-ing to Bittlingmayer. As a result, “Rooseveltbegan pulling his antitrust punches in late1907.”

The Hepburn Act, the panic of 1907,and related antitrust measures set the foun-dation for the 1935 National RecoveryAdministration, a corporatist program start-ed by TR’s relative, Franklin Delano Roo-sevelt, but declared unconstitutional by theSupreme Court.

Preventing “Race Suicide”In addition to his Hamiltonian impuls-

es and New Imperialism, Theodore Roo-sevelt, like many of the “elite” of his time,supported eugenics. TR praised America’swar against Native Americans, saying: “Idon’t go so far as to think that the onlygood Indians are dead Indians, but I believenine out of ten are, and I shouldn’t like toinquire too closely into the case of the tenth.The most vicious cowboy has more moralprinciple than the average Indian.” TheMexicans living in Texas deserved to berouted because they were inferior, said TR.“It was out of the question that the Texansshould long continue under Mexican rule.. . . It was out of the question to expectthem to submit to the mastery of the weak-er race, which they were supplanting. What-ever might be the pretexts alleged for revolt,

At a reception onConstitution Day,Cato’s Tom G.Palmer makes apoint to law professors ToddZywicki and David Bernstein of George MasonUniversity and Marcus Cole ofStanford University.



CONSTITUTION Continued from page 15

the real reasons were to be found in thedeeply marked difference of race, and inthe absolute unfitness of the Mexicans togovern themselves, to say nothing of gov-erning others.”

TR publicly deplored what he called the“unrestricted breeding” of nonwhites, peo-ple he termed “utterly shiftless” and “worth-less.” He considered blacks to be the whiteman’s “burden.” (In his memoirs, TR cen-sored the fact that hundreds of black sol-diers in the Negro 9th and 10th Cavalrieshad helped capture San Juan Hill in Cuba.)TR often called on Americans to be “goodbreeders” to prevent “race suicide.”

Some of TR’s other racial Darwinistcomments include:

• “A perfectly stupid race can never riseto a very high plane; the Negro, forinstance, has been kept down as muchby lack of intellectual development asby anything else.”

• “All reflecting men of both races areunited in feeling that race purity mustbe maintained.”

• “The [African] porters are strong, patient,good-humored savages, with somethingchildlike about them that makes onereally fond of them. Of course, like allsavages and most children, they havetheir limitations.”

• “The presence of the Negro is the realproblem; slavery is merely the worstpossible method of solving the prob-lem.”

• “Nothing but sheer evil has come fromthe victories of Turk and Tartar. This istrue generally of the victories of bar-barians of low racial characteristics overgentler, more moral, and more refinedpeoples.”

TR was also anti-immigration, exceptfor white Protestant Europeans. In criti-cizing entrepreneurs who were bringing inChinese to work in the western UnitedStates, TR said, “It seems incredible that

any man of even moderate intelligenceshould not see that no greater calamitycould now befall the United States than tohave the Pacific slope fill up with a Mon-golian population.” It was the duty of thewhite race and democracy, “with the clearinstinct of race selfishness,” to keep outthe “dangerous alien” Chinese, he said.

“Roosevelt probably did more than anyother individual to bring the views of aca-demic race theorists to ordinary Ameri-cans,” says historian Diane Paul in Con-trolling Human Heredity: 1865 to the Pre-sent. TR, for instance, often stressed theneed to “keep out races which do not assim-ilate with our own”—his words—and repeat-edly called for curbs on immigration.

Roosevelt praised The Passing of theGreat Race by eugenicist Madison Grant.The book called for “elimination of thosewho are weak or unfit,” the “undesirableswho crowd our jails, hospitals, and insaneasylums,” and “weaklings” and “worth-less race types.” Roosevelt said that it was“a capital book: in purpose, in vision, ingrasp of the facts that our people must needto realize. . . . It is the work of an Ameri-can scholar and gentleman, and all Amer-icans should be grateful to you for writingit.” State-enforced sterilization of retard-ed people in the United States began in1907 when TR was president. He didnot oppose the programs and did nothingto stop such sterilization. (For compari-son, compulsory sterilization in Nazi Ger-many did not start until 1935.)

A Model Conservative?Theodore Roosevelt, whom some con-

servatives would make a patron saint,spread over the United States a federal reg-ulatory blanket that has often smotheredbusinesses and stifled entrepreneurship.TR’s broadening of executive power upsetthe constitutional checks and balances ofour republic. His imperialism set a prece-dent for U.S. meddling abroad and entan-gling alliances—a policy unfortunatelypraised by today’s neoconservatives. MarkTwain, who knew Theodore Roosevelt,may have exaggerated when he describedhim as “clearly insane.” But there’s nodoubt that TR was a poor friend of theConstitution, capitalism, and peace. ■

❝ TR’s broadening of executive power upset the constitutional checks and balances of our republic.❞

Meet WalterWilliams and Gary Johnson in NaplesCato’s 15th Annual Benefactor Summit, February 26–March 2 at thebeautiful LaPlaya Beach Club andResort in Naples, Florida, will featureGov. Gary Johnson, Walter Williams,and all your favorite Cato scholarsand writers. Isn’t it time you became aCato Benefactor and joined us for thisgreat event? For information contactLesley Albanese at [email protected] (202) 789-5223.

Walter Williams

Gary Johnson



on the President’s Commission to Strength-en Social Security” (Social Security Paperno. 27), many of the commission’s strongestcritics endorsed the commission’s argumentsbefore it became clear that those argumentscould be used to support personal retire-ment accounts. Biggs surveys the commis-sion’s three proposals, each of which wouldallow workers to divert some portion oftheir payroll taxes to personally ownedinvestment accounts. After assessing thevirtues and drawbacks of each proposal,Biggs concludes that, although none is per-fect, reform critics have an obligation eitherto propose viable alternatives or to admitthat they favor a course of inaction, whichwould permit the collapse of the Social Secu-rity system. “The correct question,” Biggswrites, “isn’t whether we can afford toreform Social Security but whether we canafford not to.”

◆ FDR Stalls Confirmation Hearings Despite a large number of vacancies on U.S.appellate and district courts, George W.Bush’s nominees to fill those spots havebeen blocked by Congress at an astonish-ing and historically unprecedented rate. Thelegislature’s traditional deference to presi-dential appointments and the primacy ofjurisprudential competence over ideologi-cal considerations in confirmation hearingshave all but vanished. That is no accident,writes Cato’s vice president for legal affairs

Roger Pilon in “How Constitutional Cor-ruption Has Led to Ideological Litmus Testsfor Judicial Nominees” (Policy Analysisno. 446); it is the inevitable effect of SupremeCourt decisions since the Progressive Era,which have eroded the doctrine of enu-merated powers. When judges commonlyinvent novel rights or let popular opinionguide decisions, says Pilon, the courtsbecome, not interpretive, but policymak-ing forums and the selection of membersis naturally politicized.

◆ Attacks on “Frankenfoods” MaskProtectionismAgricultural biotechnology, explains Catoadjunct scholar Ronald Bailey in “TheLooming Trade War over Plant Biotech-nology” (Trade Policy Analysis no. 18),has the potential to reduce the need forchemical pesticides, make farmers less vul-nerable to drought, and increase both theyield and the nutritional value of crops.But anti-biotech activists have succeededin frightening many Europeans away fromso-called Frankenfoods, despite a dearthof credible scientific evidence that biotech-nology is dangerous. Bailey says that Euro-pean Union leaders, eager to circumventWorld Trade Organization rules proscrib-ing protectionism in agricultural mar-kets, will attempt to sneak trade barriersthrough WTO provisions allowing nationsto enact health regulations based on inter-nationally recognized standards. Americantrade negotiators, writes Bailey, must act

STUDIES Continued from page 13 swiftly to defeat an unscientific BiosafetyProtocol, which would legitimize such bar-riers, and to prevent a protectionist hijack-ing of next summer’s meeting of the CodexAlimentarius Commission, which will con-sider principles to govern biotechnology.

◆ Fighting Drugs, Embracing DespotsThe U.S. government frequently invokesthe rhetoric of human rights to justify itsactions on the international stage. Butaccording to Ted Galen Carpenter, Cato’svice president for defense and foreign pol-icy studies, “The United States has repeat-edly made a ‘drug war exception’ in its for-eign policy toward repugnant and repres-sive regimes.” In a new Cato study, “Unsa-vory Bedfellows: Washington’s Interna-tional Partners in the War on Drugs” (For-eign Policy Briefing no. 71), Carpenterexamines several cases of American coop-eration with despots, among them Pana-manian strongman Manuel Noriega, Peru’sAlberto Fujimori, Cuban dictator FidelCastro, the military junta controlling Bur-ma, and even Afghanistan’s former Talibanrulers. Ironically, Carpenter writes, “In caseafter case, Washington’s ostensible part-ners in the anti-drug crusade have them-selves been extensively involved in drugtrafficking.” Carpenter warns against toohastily embracing Colombia’s Alvaro Uribe,who was widely supported by right-wingparamilitary groups and one of whose closeassociates has been accused of complicityin drug trafficking. ■

Cato’s efforts to reform Social Security continued through the summer andfall: The Capitol Hill program, “Social Security 101,” featuring Michael Tan-ner and Andrew Biggs, was broadcast live by C-SPAN on August 26. At a

series of Forums on “Social Security and Young Americans,” speakers includ-ed Chris Stallman of TeenAnalyst.com; Neil Howe, coauthor of Millennials Ris-ing: The Next Great Generation; and Meredith Bagby of Third Millennium.


Over the course of almost two decadesas a foreign policy scholar at the CatoInstitute, Ted Galen Carpenter hasbeen a consistent and prolific advo-

cate of what he calls “strategic independ-ence” in foreign affairs. Rejecting the extremesof isolationism and “promiscuous globalinterventionism,” Carpenter has steadfastlyadvocated “a vigorous defense of Ameri-ca’s vital interests,” while insisting no lessemphatically that only when vital interestsare implicated should the United States actmilitarily. In a new Cato Institute book,Peace and Freedom: Foreign Policy for aConstitutional Republic, Carpenter bringstogether a cross section of his writings span-ning 17 years along with new material tyingtogether his central themes and outliningthe changes wrought in American foreignpolicy by the events of September 11, 2001.What emerges is a cohesive, comprehen-sive, and principled approach to every majorquestion of foreign policy faced by the Unit-ed States in recent memory.

On the central question of how best todeal with terrorism, Carpenter’s 1997 analy-sis of the first World Trade Center bomb-ing now appears all too prescient. Partlyas a result of American support for despot-ic regimes in the Middle East, he warnedthat “the potential for thousands, ratherthan dozens or hundreds, of casualties inany single incident is rising.” Had his tri-partite prescription of disengaging fromunnecessary foreign commitments, refo-

cusing intelligence agencies on the terror-ist threat, and declaring war against statesponsors of terrorism been followed fiveyears ago, that prediction might not havebeen so terribly confirmed.

A glance at the earlier works reproducedhere reveals an astonishing record of accu-racy not only with respect to ter-rorism but in almostevery arena of for-eign policy. Carpen-ter saw as early as1992 that, until Rus-sia established the ruleof law and a stablemarket system, aid tothe newborn democra-cy would be futile. Adecade later, billions ofdollars in loans have beensquandered, and billionsmore have vanished with-out a trace. Well before thefirst bombs were dropped,he saw that well-intentionedhumanitarian intervention in the Balkanswould, tragically, only exacerbate humanrights abuses and mire the United States inan interminable and counterproductivenation-building project. And while mostobservers of international affairs expectedNATO to wither away like Marx’s idealcommunist state after the Cold War’s end,Carpenter anticipated that powerful con-stituencies would keep the organization

together, flailing about in search of a mis-sion.

If this series of grim visions realized isdispiriting, it at least indicates that Car-penter may be a solid guide to avoiding rep-etitions of past mistakes. In the Pacific Basin,

Carpenter observes that we contin-ue to take responsibility for the defenseof nations, such as South Korea andJapan, which are more than capa-ble of maintaining adequate forceson their own. By ending the mili-tary dependence of those nationson the United States, he says, wewould encourage the emergenceof regional powers capable ofcontaining China’s expansion-ist ambitions. Carpenter positsthat our own strategy shouldbe to continue open trade withChina in the hopes that, as ithas in so many other Asiancountries, liberalization of the

economy will eventually be mirrored byliberalization in the political sphere. Ratherthan abandon or rush to defend Taiwan,he suggests that we step up sales of advancedweapons to the young democracy, thusallowing it to deter China without riskingAmerican lives. Indeed, Carpenter’s gener-al advice to U.S. policymakers might besummarized as this: Let go! Abandon attemptsto preserve the hegemonic status the Unit-ed States had during the Cold War era, anddo what you can to encourage democrat-ic great powers to arise in the world’s trou-ble spots.

Even people primarily concerned withdomestic policy will find much of interestin Peace and Freedom. Carpenter detailsthe ways in which the international war ondrugs has devastated poor farmers in devel-oping countries and squandered goodwilltoward the United States abroad. Perhapseven more important, Carpenter remindsus that an overactive foreign policy is incom-patible with domestic freedom. We cannotexpect an open society to flourish withinour borders as we transform the rest of theworld into a garrison.

Peace and Freedom can be purchased($19.95 cloth/$12.95 paper) from CatoInstitute Books at 1-800-767-1241 or fromthe Cato website, www.cato.org. ■


Cato Book

Carpenter Calls for “Strategic Independence”Essays on terrorism, Russia, China, Balkans

Several hundred traders and Cato Sponsors gathered at the Chicago Mercantile Exchange after themarket closed on September 18 to hear P. J. O’Rourke, Cato’s Mencken Research Fellow, discuss hisbook, The CEO of the Sofa, just published in paperback.


Interns are the secret motor of the poli-cy world. Supporting the visible outputof Washington’s think tanks—the poli-cy conferences, scholarly papers, and op-

ed columns—are unseen battalions of sharpcollege students who surrender four monthsto work for causes that inspire them and,in the process, learn the ropes of the ideaindustry.

The Cato Institute has been a leader inthis process; it has taken on interns year-round since 1978, when Tom G. Palmer,now a senior fellow at Cato, became oneof three interns. For many interns, a semes-ter at Cato is only the beginning of a longcareer devoted to the classical liberal vision.In addition to Palmer, Institute for Justicesenior litigator Scott Bullock spent a sum-mer at Cato, as did Wall Street Journalcolumnist John Fund; Cato education pol-icy analyst Marie Gryphon; ABC produc-er Kristina Kendall, who works on JohnStossel’s reports; and Aaron Lukas, nowspeech writer for the U.S. Trade Repre-sentative. Bullock, who served as RogerPilon’s first intern in 1989, said the expe-rience “whetted my appetite to engage indirect combat with government officialswho do not respect the Constitution.” Someof Cato’s most recent interns have even

launched a website called Protocol (www.protocolmagazine.com).

One of the many benefits of globaliza-tion has been its effect on the intern pool,which in recent years has become increas-ingly international. Palmer, who leads week-ly seminars for interns, has observed thatstudents who have experienced the fail-ure of leviathan states up close are oftenthe most passionate advocates of limitedgovernment. Spring intern Gene Ostrovsky’sfamily escaped the prison society of theUSSR when he was 10. Though struck bythe sharp contrast between his former homeand the United States, Ostrovsky was “trou-bled to see certain aspects of socialism beingattempted here for which we hated the Sovi-et Union” and resolved to do what he couldto fight that trend. Many of Cato’s sum-mer interns are placed via the Charles G.Koch Summer Fellow Program, which thisyear referred three students who were raisedunder communism. Svetlana Meyerzon,whose family left Moldova after the fall ofthe Soviet Union, said her experience withinjustice and anti-Semitism there made heracutely appreciative of the freedoms foundin “the open society that became my home.”The “stifling atmosphere of Soviet Kaza-khstan” made Daniya Tamendarova wary


Interns Learn about Liberty at CatoThose from Russia and Moldova already understand

the Eleventh Amendment. The expansionof sovereign immunity sacrifices individ-ual rights to “states’ rights,” a concept Levysaid has no place in a proper theory of fed-eralism, which should center instead on theidea of “dual sovereignty.”

Swanson offered a piece of qualifiedgood news: the Court had struck downrestrictions on the political speech of can-didates for judgeships, but by a mere onevote margin. Since political speech has tra-ditionally been held to be at the core of thesphere protected by the First Amendment,said Swanson, it should be worrisome thatthe margin was not far wider.

Following a dinner reception, JudgeDouglas H. Ginsburg of the U.S. Courtof Appeals for the District of Columbia

SUPREME COURT Continued from page 3 delivered the first B. Kenneth Simon Lec-ture in Constitutional Thought. Judge Gins-burg spoke on such historically neglectedconstitutional provisions as the ContractClause and the Second Amendment, whichhe called a “Constitution in exile.”

The Cato Supreme Court Review alsofeatures pieces on the state of anonymousspeech rights, school choice, criminal pro-cedure, “virtual” child pornography, andthe war on drugs. The authors includeGeorge Washington University law pro-fessor Jonathan Turley, attorneys RobertCorn-Revere and Stephen P. Halbrook, andInstitute for Justice vice president Clint Bol-ick.

Cato Supreme Court Review can be purchased ($15.00 paper) online atwww.cato.org or from Cato Institute Booksat 1-800-767-1241. ■

of those who propose that liberty be cur-tailed in the interests of “preserving order.”Peter Jaworski’s family fled communistPoland for Germany when he was only sixand continued to Canada three years lat-er. He says that he applied for a Cato intern-ship because he associates the Institute withthe ideal of freedom that distinguishes hisadopted home from the country of his birth.“My grandparents still remember when abook called Solidarnosc z Wolnoscia [Sol-idarity with Liberty] was smuggled intoPoland by Cato,” said Jaworski. “Now, Isee Canadian newspapers cite Cato. Whereelse can I get that sort of inspiration?” ■

Judge A. Raymond Randolph of the U.S. Court ofAppeals for the D.C. Circuit talks with J. HarvieWilkinson, chief judge of the Fourth Circuit, atCato’s Constitution Day launch of the CatoSupreme Court Review.

Summer interns Peter Jaworski, originally fromPoland, Daniya Tamendarova from Kazakhstan,and Svetlana Meyerzon from Moldova.


CATO POLICY REPORT1000 Massachusetts Ave., N.W.Washington, D.C. 20001

ADDRESS CORRECTION REQUESTED

“To Be Governed...”

◆ Learning from history[Maryland Republican gubernatorial

candidate Bob] Ehrlich struggled to shiftthe focus away from his record in Con-gress, where he has served four terms, as[Democratic nominee Kathleen Kennedy]Townsend rarely passed up an opportu-nity to slam him for his votes on educa-tion, health care, affirmative action andother issues.

She also expressed disdain for his com-ments on how he and Steele are reachingout to black voters, and she highlightedhis votes in favor of basing affirmativeaction programs on economic circum-stance rather than race or ethnicity.

“He opposes affirmative action basedon race,” she said. “Well, let me tell you,slavery was based on race. Lynching wasbased on race. Discrimination is basedon race. Jim Crow was based on race.And affirmative action should be basedon race.”

—Washington Post, Sept. 27, 2002

◆ Such as the 10 who were monitoringthe New Orleans brothel for 13 months

The report portrays a dramatic con-cern [about al-Qaeda] at senior levels,and in particular at the CIA, that did not,in all cases, reach frontline field person-nel.

In a Dec. 4, 1998, memo to his deputies,for example, CIA Director George J. Tenet

issued guidance “declaring, in effect, war”with bin Laden.

“We must now enter a new phase inour effort against bin Laden,” Tenet wrote.“We are at war. . . . I want no resources orpeople spared in this effort, either insidethe CIA or the [intelligence] Community.”

But the panel’s staff director, EleanorHill, said yesterday that Tenet’s fervordid not “reach the level in the field thatis critical so [FBI agents] know what theirpriorities are.” Some FBI agents inter-viewed, in fact, “were not focused on alQaeda,” she said.


◆ Which Bush is that?Bush’s belief in the virtues of unfet-

tered, free-market capitalism is as strongas [AFL-CIO president John] Sweeney’ssupport of interventionist policies.


◆ Those pesky desires to make independ-ent decisions

Congress has all but abandoned leg-islative proposals to ensure that employ-ee retirement funds are not concentrat-ed in their employers’ stock, after hear-ing from businesses that vigorously opposesuch restrictions. . . .

“There are some realities that we haveto deal with in terms of people’s per-sonal desires to make independent deci-

sions,” [Sen. Edward M.] Kennedy said.—Washington Post, Sept. 7, 2002

◆ How dare you engage in commercewithout my authorization?

Passersby regarded the contraption—possibly the future of the corner store—from a safe distance, staring through theglass at rows of milk jugs, snack foodand toiletries waiting to be dispensed,with no clerks or cashiers needed. Thething resembles part ATM, part candymachine on steroids, and carries the labelTik Tok Easy Shop. . . .

Ward 1 D.C. Council member Jim Gra-ham pulled up to “the Box” in his Saabjust after noon yesterday. Graham expresseddispleasure with the aesthetics of the TikTok Easy Shop—but was mostly surprisedit was there at all. "It seems like it wasdropped on us from outer space," he said.“As the council member of this ward, Ireceived no proper notification.”

—Washington Post, Aug. 30, 2002

◆ As opposed to, say, oursThe designation “civil service” has

always been something of a misnomer inRussia. Since the formation of a central-ized state about 800 years ago, bureau-crats have mainly served the country’sleaders, not its people. And they havebeen anything but civil.

—Washington Post, July 15, 2002

Nonprofit OrganizationU.S. Postage PaidWashington, D.C.Permit No. 3571


Documents

TR: No Friend of the Constitution - Cato Institute · some 200,000 noncombatant Filipinos, ... Fiscal Policy Report Card 12 ... should reflect our values. It should