Archive

Author Archive
August 28th, 2015 at 9:51 am
Rubio: Beat China via Free Trade and Passing Trans-Pacific Partnership, Not Self-Destructive Protectionism
Posted by Timothy Lee Print

In confronting the growing challenge of China, as with Japan in the 1980s and other challengers in the past, the easy and simplistic response is to advocate protectionism.  But America remains the most prosperous and innovative nation in human history on the basis of free trade, not protectionism.  If closing borders to trade was the path to prosperity, then North Korea would be a global exemplar.

On that chord, Senator Marco Rubio (R – Florida), set to give a much-anticipated foreign policy speech on the campaign trail today, offers a refreshing commentary in today’s Wall Street Journal entitled “How My Presidency Would Deal With China.”  In his piece, Rubio advocates free trade and passing the Trans-Pacific Partnership as effective tools for confronting China, resisting the cheap and easy protectionist platitudes:

My second goal is protecting the U.S. economy.  For years, China has subsidized exports, devalued its currency, restricted imports and stolen technology on a massive scale.  As president, I would respond not through aggressive retaliation, which would hurt the U.S. as much as China, but by greater commitment and firmer insistence on free markets and free trade.  This means immediately moving forward with the Trans-Pacific Partnership and other trade agreements.”

Protectionism and irrational alarm over trade balance only serve to undermine American growth.  After all, the 1930s Great Depression in the U.S. witnessed trade surpluses in 102 of that decade’s 120 months.  The better answer is to maintain America’s standing as a nation of free trade, through which we will overcome today’s challenges just as we have previous decades’ similar challenges.

August 25th, 2015 at 11:35 am
Barone: Even Clinton and Obama Military Appointees Widely Oppose Iran Nuclear Capitulation
Posted by Timothy Lee Print

In recent days we’ve noted how the American public now opposes Obama’s Iran nuclear weapons agreement by 2-to-1 margins, and how opposition in both the Senate and House of Representatives is approaching 2/3 veto-proof majorities.

Apparently, opposition within military and intelligence communities is similarly broad.

In a new piece this week, Michael Barone lists a number of military and intelligence figures appointed during the Clinton and Obama administrations who voice sharp opposition to the proposed deal.  From well-known names like General Michael Hayden to General Barry McCaffrey and several others, it’s an impressive list.  As Barone concludes, “These are all highly respected retired military officers whose judgment should command respect, and their criticisms of the Iran deal are certainly withering.”

Tags: , ,
August 24th, 2015 at 3:15 pm
This Week’s “Your Turn” Radio Lineup
Posted by Timothy Lee Print

Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CDT to 6:00 p.m. CDT (that’s 5:00 p.m. to 7:00 p.m. EDT) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CDT/5:00 pm EDT:  Clark Neily, Senior Attorney for the Institute for Justice – Separation of Powers;

4:30 CDT/5:30 pm EDT:  Quin Hillyer, Newspaper Columnist and Writer – Candidates 2016, Including Trumps Visit to Alabama Quin’s Interview with Scott Walker;

5:00 CDT/6:00 pm EDT:  Sarah Westwood, Watchdog Reporter for the Washington Examiner – Hillary Clinton E-Mails; and

5:30 CDT/6:30 pm EDT:  Timothy Lee, CFIF’s Senior Vice President for Legal and Public Affairs – Iran, Puerto Rico and the First Amendment.

Listen live on the Internet here.   Call in to share your comments or ask questions of today’s guests at (850) 623-1330

Tags:
August 24th, 2015 at 11:44 am
Puerto Rico: Rule of Law and Fidelity of Contract, Not Bankruptcy
Posted by Timothy Lee Print

At CFIF, we stand for the rule of law and with American taxpayers, investors, savers and seniors against the destructive proposal floated by some in Washington, D.C. of changing longstanding law to allow Puerto Rico to declare bankruptcy.

Accordingly, we’re happy to see that in her weekly “The Americas” column in today’s Wall Street Journal, Mary Anastasia O’Grady highlights the way in which pro-bankruptcy advocates undermine the rule of law by disregarding contractual property rights:

The governor, and the legislature which his party controls, made a conscious decision when they approved the budget not to put the funds aside for that payment.  ’They are explicitly legislating default because they think that puts the creditors on their knees.  Then the creditors will have to make concessions…  Creditors have protections [in bond contracts],’ he adds, ‘and a court of law is going to enforce those agreements.’  Securitized bonds provide bondholders with a property right to a designated cash-flow stream.”

As we specified previously, better alternatives exist:

For example, the Puerto Rican government could actually pay the hundreds of millions of dollars it owes to the power authority (PREPA), or Congress could impose greater oversight over Puerto Rico.  Remember, a financial control board was effective in reforming the District of Columbia’s finances 20 years ago, accomplished on a bipartisan basis by a Republican Congress and a Democratic president.  Ultimately, that might be the way to put in place comprehensive, structural reforms so that Puerto Rico never again spirals out of control.”

The solution is adherence to the rule of law and the enforcement of mutually bargained-for contract, not yet another bailout imposed upon American taxpayers.

August 21st, 2015 at 9:47 am
Iran Deal: House and Senate Approaching Veto-Proof Majorities
Posted by Timothy Lee Print

As we recently noted, we’ve reached a strange state of political affairs when the definition of “success” in the Obama Era is reduced to scraping together a 1/3 minority of either chamber of Congress to salvage an executive accord with the terrorist state of Iran.

With clear majorities in both the House and the Senate already opposed to the accord, and an overwhelming majority of Americans also opposed, Obama’s remaining hope is that he can convince 1/3 of either house to stick with him.  Should that occur, expect another one of his tawdry “victory” dances afterward.

According to the latest tally from The Washington Post, however, even achieving that 1/3 minority level of support is in jeopardy.  In the House, 290 votes are required to override an Obama veto of a resolution rejecting the accord.  The Post confirms that “all 246 House Republicans are expected to vote against the deal,”  with 18 Democrats either already against the deal or leaning against the deal, for a total of 264.  With 82 Democrats either for the deal or leaning toward favoring it, that means only 26 of 88 undeclared Democrats are needed to reach the veto override threshold.

In the Senate, meanwhile, 67 votes are required to override an Obama veto.  The Post calculates that “56 Senators – including all Republicans plus two Democrats (Sens. Chuck Schumer (N.Y.) and Bob Menendez (N.J.)) – are either overtly against the pact or presumed foes.”  According to its estimate, 31 Democrats are either on record supporting the agreement or leaning that way, leaving 13 undecided.

Persuading 11 of that remaining 13 to do the right thing rather than march in lockstep with a president who will be out of office in little more than one year will be an uphill climb.  Each day, however, brings new disturbing revelations regarding the mechanics of the accord, including this week’s news that Iran will essentially be allowed to self-report on its nuclear activities.  That drip, drip, drip only makes support for Obama’s deal less defensible, and increases the justification for rejecting this dangerous capitulation.

Tags: , , ,
August 17th, 2015 at 2:23 pm
With Crime Up 26% in NYC, Guardian Angels Make a Return
Posted by Timothy Lee Print

Although we support criminal justice and prison reform, we have cautioned against abandoning the tougher policing and sentencing reforms that resulted in such a remarkable and unexpected drop in American crime rates over the past two decades:

The U.S. homicide rate has been cut in half since 1992, from 9.3 murders per 100,000 people to 4.7.  That is its lowest level since 1963.  Violent crime rates reached 80 per 1,000 in 1993, but are down to 20 per 1,000 today.  No city represents that improvement more than the one most associated with broken windows policing and get-tough policies, the formerly dystopian New York City.  In 1993, the city’s murder rate  reached 26.5 per 100,000 people, and accounted for almost 8% of all U.S. homicides.  After twenty years of broken window police tactics, the rate has plummeted to 4 per 100,000, tourism has increased, famous public places are safer and the city has enjoyed an economic and lifestyle renaissance.

Disturbingly, however, two decades of plummeting crime rates have paradoxically allowed a popular sense of complacency to return, at least among political leaders seeking street cred with electoral subgroups and media indulgence.”

Unfortunately, we’re already witnessing early consequences of that movement.  In New York, as detailed today by The Telegraph, crime has already risen 26% this year, prompting the return of something to which we became accustomed in the ugly days of the 1970s and ’80s there:

With their bright red jackets and berets, the Guardian Angels were once a common sight in a city riddled with violent crime.  And this week they made a pointed return to New York’s Central Park for the first time in more than two decades, citing a 26 per cent rise in crime there so far this year.”

If nothing else, the sense of security that had returned to New York is already slipping away.  Meanwhile, even CNN reports today that a police officer pistol-whipped unconscious last week in Alabama deliberately hesitated to use appropriate force in the face of attack out of fear of being accused of racism.

While prison and criminal law reform are somewhat severable from tough policing as policy issues, this is simply not something on which we can remain complacent, lest the bad old days return.

August 14th, 2015 at 11:07 am
Gallup: Obama’s Iran Sales Job Failing with Americans
Posted by Timothy Lee Print

It says a lot about how far the Obama years have defined “success” downward that he will claim victory if he can manage to convince just 1/3 of either house of Congress to approve his much-maligned Iran nuclear capitulation.  That’s all he’ll need to overcome a near-certain veto, but leave it to him to claim that 33% amounts to some sort of mandate and justification for yet another tawdry victory lap.

Judging from public opinion, however, he may not even reach that minimal degree of support.  According to a new Gallup survey, only one in three Americans support his dealings with Iran.  In fact, Obama is under 50% approval on every single one of eight surveyed issues – race relations, the economy, terrorism, immigration, foreign affairs, education, climate change and Iran:

Only one in three Americans approve of President Barack Obama’s handling of the situation in Iran – his lowest rating of eight issues measured in a new Gallup survey.  The president’s policy toward Iran has been a major focus as he tries to drum up support for the multi-national agreement to limit Iran’s nuclear capabilities that Secretary of State John Kerry helped broker.  Obama earns his highest marks on race relations, education and climate change, though he does not receive majority approval on any.”

A president typically retains greater latitude and approval from Americans when it comes to foreign affairs, but the fact that the public rejects Obama’s Iran accord by such a wide margin is encouraging.  Now if only enough members of Congress can demonstrate similar sobriety and reject this dangerous deal with such disastrous potential long-term consequences for the nation, the region and the globe.

Tags: , ,
August 3rd, 2015 at 9:56 am
New Poll: Americans Oppose Obama-Iran Accord By Over 2-to-1
Posted by Timothy Lee Print

There’s good news to begin the week from the public opinion front.

Despite – or perhaps because of – the Obama Administration’s desperate effort to sell a skeptical Congress and American electorate on its dangerous nuclear accord with Iran, a new Quinnipiac poll shows that the public opposes the deal by more than a two-to-one margin:

American voters oppose 57-28 percent, with only lukewarm support from Democrats and overwhelming opposition from Republicans and independent voters, the nuclear pact negotiated with Iran, according to a Quinnipiac University national poll released today.  Voters say 58-30 percent the nuclear pact will make the world less safe, the independent Quinnipiac University poll finds.”

That skepticism is matched by some in Congress, including Senator Tom Cotton (R – Arkansas) and Representative Mike Pompeo (R – Kansas).  In a Wall Street Journal commentary this morning, they highlight how secret side deals between Iran and third parties offer an additional reason to withhold support:

The response from the administration to questions about the side deals has brought little reassurance.  At first the administration refrained from acknowledging their existence.  Unable to sustain that position, National Security Adviser Susan Rice said on July 22 during a White House press briefing that the administration ‘knows’ the ‘content’ of the arrangements and would brief Congress on it.  Yet the same day Secretary of State John Kerry, in a closed-door briefing with members of Congress, said he had not read the side deals.  And on July 29 when pressed in a Senate hearing, Mr. Kerry admitted that a member of his negotiating team ‘may’ have read the arrangements but he was not sure.

That person, Undersecretary of State and lead negotiator Wendy Sherman, on July 30 said in an interview on MSNBC, ‘I saw the pieces of paper but wasn’t allowed to keep them.  All of the members of the P5+1 did in Vienna, and so did some of my experts who certainly understand this even better than I do.’

A game of nuclear telephone and hearsay is simply not good enough, not for a decision as grave as this one.  The Iran Nuclear Agreement Review Act says Congress must have full access to all nuclear agreement documents – not unverifiable accounts from Ms. Sherman or others of what may or may not be in the secret side deals.  How else can Congress, in good conscience, vote on the overall deal?”

The simple answer is that it cannot.  The Obama Administration’s disastrous Iran proposal must be rejected, and we urge our supporters and activists to contact their elected representatives in both the Senate and House to demand opposition.

July 31st, 2015 at 10:01 am
Sticker Shock: Healthcare Spending Spikes As ObamaCare Takes Effect
Posted by Timothy Lee Print

For some time now, Barack Obama and his apologists have trumpeted slowing healthcare costs as somehow attributable to ObamaCare.  Never mind that the declines predated Obama’s election, and that even The Washington Post gave him three Pinocchios in its Fact Checker analysis of this claim on November 5 of last year:

Healthcare inflation has gone down every single year since the law [ObamaCare] passed, so that we now have the lowest increase in healthcare costs in 50 years – which is saving us about $180 billion in reduced overall costs to the federal government and in the Medicare program.”

To illustrate how he played the role of rooster taking credit for the sunrise, healthcare cost inflation reached 7% in 2003, but plummeted to approximately 2% before Obama even took office.

Regardless, but healthcare costs are spiking again as ObamaCare actually takes effect:

Growth in national health spending, which had dropped to historic lows in recent years, has snapped back and is set to continue at a faster pace over the next decade, federal actuaries said Tuesday…  The jump comes after five consecutive years of average spending growth of less than 4% annually – a rate touted by the Obama Administration as the lowest since the government began tracking health spending in the 1960s and a sign that the health law’s Medicare provisions were helping rein in health costs.”

Ooops.

Chalk up yet another failure of ObamaCare, which helps explain why it remains so unpopular among Americans as we “find out what’s in it” in the words of Nancy Pelosi.

July 28th, 2015 at 3:47 pm
Congress Should Oppose the So-Called “Local Radio Freedom Act”
Posted by Timothy Lee Print

Elementary concepts of fairness demand that musical artists and performers remain free to negotiate performance rights with broadcasters that seek to play their songs.  Indeed, current law allows artists to mutually bargain with satellite, Internet and cable stations.

The only exception:  traditional AM-FM radio stations, which are unfairly protected by federal law from having to negotiate with artists for performance rights.  This is precisely the sort of crony capitalism against which the American electorate is increasingly irate.

Unfortunately, rather than advocating market reform, some in Congress wish to cement the current protectionist status quo.  Under the so-called “Local Radio Freedom Act,” whose very name contradicts its real-world effect, terrestrial radio’s unjustifiable exemption from having to negotiate performance rights would be made more permanent.  The bill would foreclose bargained-for negotiation between artists and stations for compensation, perpetuating stations’ ability to earn billions by playing songs without paying for them.  And in an example of of supreme chutzpah, the same traditional radio stations benefiting from that loophole turn around and ask Congress to require cable and satellite providers to pay them for retransmission of television programs of stations they happen to own.

The bill’s proponents advance the offensive claim that artists seeking payment should just shut up and appreciate that their works get played over the air, thereby providing them publicity and advertising.  But that’s not something that stations should dictate.  The creators and performers of those songs should be free to determine which market model they prefer – performance for payment or free of charge.  That’s how a free market works.

Accordingly, we at CFIF have joined an array of fellow free-market organizations in a letter to Congress stating our objections to this protectionist and crony capitalist proposed legislation:

We urge you to refrain from co-sponsoring the Local Radio Freedom Act, which sanctions the status quo, and has a chilling effect on the development of a forward-thinking policy that respects the rights of all music producers in all media.  The Constitution protects private property rights and specifically delegates to Congress the authority to protect creative works.  Unfortunately, LRFA closes the discussion about how to best protect property rights by resolving that terrestrial radio should never pay performance royalties on music broadcast on their stations used for raising advertising revenue.  This is not equitable treatment for any musical artist or music distribution service.”

Americans are justifiably fed up with the sort of protectionism and cronyism that this proposed legislation represents.  We accordingly urge Congress to reject it, and that our hundreds of thousands of supporters and activists across the country to contact their representatives in Congress and express their opposition as well.

July 27th, 2015 at 2:42 pm
This Week’s “Your Turn” Radio Lineup
Posted by Timothy Lee Print

Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CDT to 6:00 p.m. CDT (that’s 5:00 p.m. to 7:00 p.m. EDT) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CDT/5:00 pm EDT:  Garland Tucker, historian and author - Conservative Heroes: Fourteen Leaders who Shaped America, from Jefferson to Reagan;

4:30 CDT/5:30 pm EDT:  David Williams, President of Taxpayers Protection Alliance – The Truth about the Solar Industry;

4:45 CDT/5:45 pm EDT:  Sarah Westwood, Investigative Reporter with the Washington Examiner – Presidential Candidates;

5:00 CDT/6:00 pm EDT:  Tzvi Kahn, Senior Policy Analyst at The Foreign Policy Initiative – Iran; and

5:30 CDT/6:30 pm EDT:  Ben Boychuk, CFIF Contributing Editor and columnist – School Reform.

Listen live on the Internet here.   Call in to share your comments or ask questions of today’s guests at (850) 623-1330

July 16th, 2015 at 10:49 am
Georgetown Study: FCC Title II Internet Regulation Will Reduce Internet Investment & Innovation Between 5% – 20%
Posted by Timothy Lee Print

As we at CFIF have discussed on numerous occasions, the Federal Communications Commission (FCC) effort to reclassify Internet service under Depression-era Title II regulations meant for copper-wire telephone service is a toxic idea on legal, economic and technological grounds.

Now, a new study from Georgetown University’s McDonough School of Business Center for Business and Public Policy provides additional intellectual heft and confirmation.  Entitled “Regulation and Investment:  A Note on Policy Evaluation Under Uncertainty, with an Application to FCC Title II Regulation of the Internet,” authors Kevin A. Hassett of the American Enterprise Institute and Robert J. Shapiro of the Georgetown Center for Business and Public Policy find that the FCC’s destructive maneuver will reduce Internet investment and innovation by an alarming 5% to 20%:

First, we showed that Title II regulation should be expected to increase costs, and therefore is the type of policy that should be expected to reduce investment.  Second, we reviewed the field-specific evidence that suggested that the scale of the negative effect would be quite large, from about 5.5 percent to as much as 20.8 percent.  Next, we documented that the ratio of investment to the capital stock would be expected to decline to roughly that extent if Title II regulation in the United States would be comparable to the regulatory framework of the OECD continental European countries in the first decade of the 21st century.  Next, we cited an analysis by a legal scholar that suggest that this analogy is reasonable.  Finally, we found that the negative effects on investment may well be significantly understated by these factors because the new regulation’s threshold effect will maximize the negative effects of uncertainty.”

The Internet has flourished to date, and become perhaps the most rapidly and profoundly transformative innovation in human history precisely because the federal government regulated with a light touch.  By reversing that regulatory stance that prevailed throughout both the Clinton and Bush Administrations, the Obama Administration FCC is placing continued innovation and investment at great risk.  This new study provides just the latest confirmation, and offers additional reason for Congress, the courts or even a future presidential administration to put a stop to it.

July 13th, 2015 at 1:14 pm
This Week’s “Your Turn” Radio Lineup
Posted by Timothy Lee Print

Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CDT to 6:00 p.m. CDT (that’s 5:00 p.m. to 7:00 p.m. EDT) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CDT/5:00 pm EDT:  James Roberts, Research Fellow for Economic Freedom and Growth at The Heritage Foundation – Greece;

4:15 CDT/5:15 pm EDT:  Bob Dorigo Jones, Senior Fellow for the Center for America – Finalists in the 18th Annual Wacky Warning Labels Contest;

4:30 CDT/5:30 pm EDT:  Logan Beirne, Lecturer in Law and Fellow, Information Society Project at Yale Law School – Treasury Department’s Seizure of Fannie Mae/Freddie Mac Profits;

5:00 CDT/6:00 pm EDT:  Timothy Lee, CFIF’s Senior Vice President of Legal and Public Affairs – Puerto Rico and Bankruptcy; and

5:30 CDT/6:30 pm EDT:  Sally Pipes, President, CEO and Thomas W. Smith Fellow in Health Care Policy at the Pacific Research Institute – Post SCOTUS ObamaCare Ruling.

Listen live on the Internet here.   Call in to share your comments or ask questions of today’s guests at (850) 623-1330.

Tags:
July 7th, 2015 at 10:21 am
New Gallup Poll on Confidence in Big Business Coincides with ObamaCare Merger Wave
Posted by Timothy Lee Print

A revealing commentary this week in The Wall Street Journal on reduced competition and insurance industry consolidation under ObamaCare coincides in an interesting manner with a new Gallup poll showing very low public confidence in big business.

In “How the Affordable Care Act Is Reducing Competition,” physician and American Enterprise Institute (AEI) resident fellow Scott Gottlieb lays out how ObamaCare by design requires industry consolidation to accommodate its massive regulatory burdens and higher operating costs:

To sustain themselves, insurers must spread fixed costs over a larger base of members.  The bigger they are, the easier it is to meet the government-imposed cap on their operating costs while cutting their way to profitability.  This pressure discourages new health plans from launching.  Startups often must channel more money into initial operating expenses.  But the caps largely prevent this, so the market stagnates…  ObamaCare’s architects saw these trends coming – and welcomed them.  They mistakenly believed that consolidation would be good for patients, on the theory that larger companies would have more capital to invest in innovations that are thought to improve coordination of medical care, such as electronic health records, integrated teams of medical providers and telemedicine.

This was a profound miscalculation.  The truth is that the greatest innovations in healthcare delivery haven’t come from federally contrived oligopolies or enormous hospital chains.  Novel concepts – whether practice-management companies, home healthcare or the first for-profit HMO – almost always have come from entrepreneurial firms, often backed by venture capital.  That venture capital has been drying up since ObamaCare was passed.”

Meanwhile, a new Gallup survey reveals that is precisely the sort of big-business favoritism that Americans distrust:

Americans are more than three times as likely to express confidence in small business as they are in big business.  Sixty-seven percent of U.S. adults report having a ‘great deal’ or ‘quite a lot’ of confidence in small business, far eclipsing the 21% who are similarly confident in big business.  Confidence in small business is up slightly from last year’s 62%, while confidence in big business is unchanged.”

This helps explain why, despite Barack Obama’s ongoing protestations and false assurances, the healthcare law bearing his name remains widely unpopular with Americans it affects.  Each week brings a fresh wave of bad news about ObamaCare, such as this week’s news of skyrocketing costs unanticipated only by those who supported the law.  Its unpopularity, along with the unpopularity of big government and big business more generally, provide optimism that Americans remain open to conservative and libertarian efforts toward replacement and reform.

July 2nd, 2015 at 2:43 pm
Forty Attorneys General and Broad Internet Safety Alliance Fight Google’s Attempt to Avoid Investigation of Alleged Illegal Behavior
Posted by Timothy Lee Print

Last December, we detailed how Google sought to exploit last year’s cyberattack against Sony for its own self-interested purposes:

Instead of joining the rest of the responsible online community in addressing the important issues of cybersecurity and the way in which the Internet is increasingly exploited to invade privacy, commit theft, sabotage and even terrorize, Google seeks to malign a very serious investigation into its own questionable Internet conduct.  Specifically, it remains under scrutiny by federal and state authorities for years of alleged anticompetitive conduct and invasion of privacy, as well as for potentially facilitating theft, fraud, illicit sale of drugs and even human trafficking.  The allegations are obviously serious, and Google is even more obviously worried enough about them to exploit the Sony cyberattack for its benefit.”

Dating back to 2011, Google admitted to illegally facilitating and profiting from advertising by Canadian pharmacies unauthorized to sell to U.S. consumers.   The charges were so grave that Google agreed to pay a half-billion dollar settlement.  State-level investigations, however, continued.  But instead of cooperating with authorities and remedying its wrongdoing, Google utilized documents exposed by the North Korean cyberattack against Sony to ask a federal court to halt further investigation into possible violation of state consumer protection laws.  Specifically, Google sought injunction prohibiting Mississippi Attorney General Jim Hood from looking into allegations that it advertised and provided access to such illegal products and services as false government IDs and even child prostitution.  A federal judge unreasonably accepted Google’s petition based upon a strained reading of a federal statute, the Communications Decency Act.

The baselessness of that injunction is vividly illustrated by the fact that some forty state attorneys general – a bipartisan alliance of 23 Republicans and 17 Democrats – petitioned the court this week to vacate the injunction.  Sustaining the ill-advised injunction, they emphasized, “would provide a roadmap for any potential wrongdoer subject to a legitimate state law enforcement investigation to attempt to thwart such an inquiry.”

Former U.S. Solicitor General Paul Clement, who has worked alongside CFIF in the past, captured the essence of the matter in a separate brief on behalf of the Digital Citizens Alliance:

The preliminary injunction entered below is the wrong remedy in the wrong court at the wrong time.  Google will enjoy ample opportunities to protect its rights if the Attorney General’s investigation is allowed to progress.  But if that investigation is halted before it begins in earnest, there will be no later opportunity to vindicate the public interest in seeing criminal misconduct investigated and stopped.  Because Google has no federal right to block a state investigation into its suspected wrongdoing, and because in any case the other relevant factors weigh unmistakably against a preliminary injunction, the decision below cannot stand.”

Mr. Clement stands among the top legal minds in America, and he hits the bullseye on this count.  When such an overwhelming bipartisan group of attorneys general joins a broad alliance of Internet safety groups, the balance of justice on this question is even more clear.

June 30th, 2015 at 2:10 pm
Two-Face T-Mobile 2.0
Posted by Timothy Lee Print

We recently described how T-Mobile was playing crony capitalist DC games and talking out of both sides of its mouth.  On one side, it told Wall Street that it’s in a great position.  On the other side, it pleaded with federal regulators in DC that it needs their help in order to remain competitive in the wireless marketplace.

The company CEO, whom The Wall Street Journal’s Holman Jenkins labeled “Potty-Mouth” Legere, is now doubling down on the company’s “Little Sisters of the Poor” message to DC and calling for a larger set-aside in the upcoming spectrum incentive auction.  The Obama Federal Communications Commission (FCC) already promised to set aside 30 MHz, but that just wasn’t enough for T-Mobile.  Now Mr. Legere and the Save Wireless Choice coalition – which conspicuously counts T-Mobile, Sprint, and DISH as members – are pushing for at least 40 MHz.

That set-aside proposal is a bad idea for several reasons.  First, T-Mobile wants the FCC to make it easier for it to get spectrum at below-market value without competing against AT&T and Verizon.  There’s no reason, however, to believe that T-Mobile can’t compete in a fair and open auction without federal bureaucrats tipping the scales in their favor.  Moreover, even if money were an issue, couldn’t T-Mobile’s multi-billion dollar parent company, Deutsche Telekom, come to its aid?

Consider the straightforward numbers:  Deutsche Telekom, a German company with a market cap over €70 billion, is a 66% stakeholder in T-Mobile.  Additionally, the German government maintains approximately a 1/3 stake in Deutsche Telekom.  Accordingly, offering T-Mobile an unjustified advantage translates into a giveaway to a foreign company and a foreign government.

But what about American consumers?  The set-aside could drive down auction revenue, which in turn means less money for the U.S. Treasury and less spectrum that’s sold and brought to market for the benefit of U.S. consumers.

FCC Chairman Tom Wheeler recently said that he thinks the set-aside should remain at 30 MHz and NOT get increased.  That’s a rare bit of moderately positive news, but if the FCC is really reviewing the set-aside in advance of its July 16th open meeting, it should eliminate this cronyist monstrosity entirely, and send Mr. Legere and his tin can packing.

June 29th, 2015 at 1:03 pm
Protectionist “Local Radio Freedom Act” Would Prevent Payment to Musicians for Songs
Posted by Timothy Lee Print

Under current law, recording artists remain free to negotiate performance payment rights with Internet, cable and satellite stations.  Due to an unfair exception, however, artists cannot negotiate in the same manner with traditional AM-FM radio.  Unfortunately, proposed federal legislation backed by broadcasting interests would cement that anomaly.  Deceptively entitled the “Local Radio Freedom Act” (”LRFA”), the bill would stifle a potentially freer marketplace and foreclose future negotiation for payment to musicians for songs.

If successful, that would perpetuate terrestrial radio broadcasters’ ability to exploit a legal loophole allowing them to earn billions of dollars by playing songs whose artists would remain uncompensated.  Exacerbating matters, those same terrestrial broadcasters simultaneously ask Congress to require cable and satellite providers to pay them for retransmission of television programming from stations that they own.  That similarly violates straightforward concepts of fairness and intellectual consistency.

This past January, CFIF joined an array of other free-market organizations in a letter to Congress opposing the LRFA and setting forth the policy basis for our objection:

The Constitution protects private property rights and specifically delegates to Congress authority to protect creative works.  Unfortunately, LRFA closes the discussion about how best to protect property rights by resolving that terrestrial radio should never pay performance royalties on music broadcast on their stations used for raising advertising revenue.  That is not equitable treatment for any musical artist or music distribution service.”

Fortunately, there’s a superior alternative also before Congress.

Representative Marsha Blackburn (R – Tennessee), perhaps the most reliable advocate of property rights in Congress, has joined Representatives from both parties in introducing the Fair Play, Fair Pay Act of 2015.  This bill would correct the existing unfairness described above by finally requiring terrestrial broadcasters to negotiate with artists who seek compensation for broadcast of their creative works.

Advocates of LRFA claim that artists have no reason to complain when terrestrial radio plays their works without compensation, since that provides them publicity and free advertising.  But that’s something for artists and broadcasters to freely negotiate, rather than have broadcasters make that decision for them and deprive them of choice in the matter.  Some artists may indeed opt to allow their works to be broadcast for free.  But as Taylor Swift just illustrated in standing up for her rights, other artists have a right to disagree and negotiate payment for those playing their songs.

CFIF believes that property rights, including intellectual property (IP) rights for artists and musicians, must be fiercely defended.  America’s foundation of strong IP protections is one reason we’re the most innovative and artistically productive nation in human history.  Accordingly, we encourage our supporters and activists to contact their representatives, demanding that they reject the dangerous LRFA and support Rep. Blackburn’s PRMA.

June 26th, 2015 at 4:12 pm
Senators Graham and Rubio Unwisely Reintroduce Nationwide Online Gaming Ban Legislation
Posted by Timothy Lee Print

In our federalist system of government, individual states constitute laboratories of democracy and remain free to enact laws as they see fit, absent explicit federal power over a particular area.  That’s a fundamental value of conservatism and libertarianism, so it was disappointing this week to see that Senators Lindsey Graham (R – South Carolina) and Marco Rubio (R – Florida) were among those reintroducing proposed legislation that would impose a blanket, nationwide prohibition of online gaming.

Such a law would commandeer states’ historical and constitutional right to regulate gaming, never mind that it would mean yet another imposition of federal power into citizens’ entertainment choices and how they spend their own hard-earned dollars.

Stated simply, individual states across the nation have authorized online poker and various other forms of Internet wagering for citizens within their own borders, with many more considering similar moves. Unfortunately, the ill-advised new proposed federal legislation introduced by Senators Graham and Rubio would upend that state of affairs.  The so-called Restoration of America’s Wire Act of 2015, which wouldn’t “restore” the Wire Act to its original meaning but rather significantly expand its reach contrary to the Fifth Circuit and Justice Department rulings, aims to impose a de facto prohibition on online gaming in all 50 states and thereby increase federal regulatory power.  Proponents claim that the new bill would protect children and problem gamers, but the more realistic consequence would be shutting down existing law-abiding companies and driving commerce toward criminal sites and unaccountable overseas entities less interested in restricting minors or problem gamers.

The better option is to maintain existing law, which rewards law-abiding domestic companies and ensures greater safety and security.  And as noted above, the proposed legislation would grossly violate the concepts of state sovereignty, free-market principles and individual consumer freedom.  The last thing we need right now is even more federal regulation of states and legal commerce, particularly within the flourishing Internet sector.

Conservatives, libertarians and Americans of every other political persuasion should therefore oppose the so-called Restoration of America’s Wire Act, and contact their Senators and Representatives to demand the same.

June 19th, 2015 at 9:51 am
WSJ News Item Debunks Leftists’ Anti-Texas Myth
Posted by Timothy Lee Print

Texas illustrates the real-world success of less government and free market principles, yet leftists like oft-discredited New York Times columnist Paul Krugman attempt to dismiss it as some sort of demographic or energy fluke.

A news feature this week in The Wall Street Journal, however, offers yet another objective refutation of their efforts.  Entitled “Texas’ Engine Keeps Revving,” the article details how jobs and population continue to grow despite the recent energy sector slump:

The continued economic success of the Dallas-Ft. Worth metro area, the nation’s fourth largest, with nearly seven million people, is one of the reasons Texas has so far managed to stave off a sharp downturn despite losing thousands of jobs in the oil patch and related industries.  The region lost more than 100,000 jobs during the recession, but it has added nearly four times that number since then…   Dallas isn’t the only Texas region that has diversified.  The San Antonio metro area, which has 2.3 million residents, now has a burgeoning biotech sector.  Austin, with its population of 1.9 million, had the lowest unemployment rate among the nation’s largest metro areas in April as it undergoes a hotel boom.”

That doesn’t happen by accident.  After all, California enjoys a higher population, better weather, diversified economic base and greater access to trade with its vast coastal area.  In other words, the sorts of things that Krugman offers as rationalizations for the Texas boom.  The reality is that Texas continues to flourish despite the rapid drop in oil prices because unlike states like California, Connecticut or Illinois, it opts for lower taxes, less regulation and freer markets.  Hopefully, that lesson will continue to sink in with the rest of the nation and our federal leaders.

June 16th, 2015 at 1:13 pm
This Week’s “Your Turn” Radio Lineup
Posted by Timothy Lee Print

Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CDT to 6:00 p.m. CDT (that’s 5:00 p.m. to 7:00 p.m. EDT) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CDT/5:00 pm EDT:  Lawrence J. McQuillan, Senior Fellow at the Independent Institute – “California Dreaming: Lessons on How to Resolve America’s Public Pension Crisis”;

4:30 CDT/5:30 pm EDT:  Robert King, Healthcare Correspondent for the Washington Examiner – High Drug Prices, Bioterror and ObamaCare;

5:00 CDT/6:00 pm EDT:  Mark Bauerlein, author and editor of “The State of the American Mind” – The Fall of Civics, a Profile of the American Mind and National Consequences; and

5:30 CDT/6:30 pm EDT:  Scott Blackburn, Research Fellow at the Center for Competitive Politics – Get IRS Out of Speech Police Business.

Listen live on the Internet here.   Call in to share your comments or ask questions of today’s guests at (850) 623-1330.