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SOTU

Yes, it is tonight. Those of us who actually follow these things can predict that many of the initiatives that will be announced by President Obama will have little significance with respect to policy because they will never make it through Congress.

Priscilla Alvarez (National Journal) has an annotated version of the 2014 SOTU address, reviewing the fate of last year’s policy wish list.

I must admit, I was actually surprised by how many of the items lived beyond the speech.

Last week Attorney General Eric Holder announced that the Department of Justice would be suspending its adoption of state civil forfeiture cases through its “Equitable Sharing” program. To review, civil asset forfeiture is the procedure by which law enforcement seizes property suspected of having been associated with a crime, and then auctions it off and uses the money for its own purposes. Under federal law, asset forfeiture is easy: the agency must simply show by a preponderance of the evidence that the property was associated with a crime, and then the owner bears the burden of proving her innocence. Under the Equitable Sharing program, the Department of Justice “adopts” state cases in states in which forfeiture laws are stricter, thereby implicating the weaker federal standard, then shares up to 80% of the proceeds of these forfeitures with state and local law enforcement.

The system creates perverse incentives for seizing the cash, vehicles, and businesses of innocent people, as last year’s blockbuster investigation by the Washington Post revealed. Moreover, the Equitable Sharing program intentionally circumvents state law. The Institute for Justice’s 2010 study Policing for Profit showed that states with stricter civil asset forfeiture procedures saw substantially greater Equitable Sharing revenues.

Thus, Holder’s announcement is very welcome. Still, as Radley Balko points out, the new policy contains some big exceptions:

. . . (1) seizures by state and local authorities working together with federal authorities in a joint task force; (2) seizures by state and local authorities that are the result of joint federal-state investigations or that are coordinated with federal authorities as part of ongoing federal investigations; or (3) seizures pursuant to federal seizure warrants, obtained from federal courts to take custody of assets originally seized under state law.

According to the WaPo story, only 57% of Equitable Sharing proceeds came from state-only investigations, so the new policy should cut payments to state and local agencies by about half. When it comes to big forfeitures, the new policy creates an obvious incentive for local law enforcement to bring in a federal investigator to create a pretext for adoption. Moreover, many of those forfeitures that are no longer adopted will still be pursued under state law, simply with a higher evidentiary threshold in many cases. Thus, the total amount of civil forfeiture that occurs in this country can be expected to drop by only a small fraction of the current annual average total.

To get a better sense of how this policy change will affect asset forfeiture in the states, I will present some numbers from the new asset forfeiture dataset that we are compiling for the fourth edition of Freedom in the 50 States. We have data on Equitable Sharing proceeds by state from Fiscal Year 2000-01 to Fiscal Year 2012-13, as well as detailed information on state standards for forfeiture.

The following time-series chart shows Equitable Sharing revenues per $1000 of state personal income for several large states: Texas, Florida, California, Illinois, and New York. These data exclude a massive, one-time payout to New York agencies for the Bernie Madoff case.
equitable sharing by state
As the chart shows, Equitable Sharing really began to ramp up in 2006-07. By 2012-13, these five states combined for $228 million in forfeiture revenues from the federal government. For each of the last four years, California was first or second among these five states in forfeiture revenue as a share of the state economy. Probably not coincidentally, California has some of the toughest procedures for civil forfeiture in the country.

In the U.S. as a whole, Equitable Sharing forfeiture revenues totaled $486 million in FY 2012-13, more than double the total of 2004-05. We don’t know just what the total value of assets forfeited in the country is, because states and localities don’t often keep track of the data. Moreover, the Equitable Sharing program includes proceeds of criminal as well as civil forfeiture (criminal forfeiture upon conviction is much less controversial). But from the states for which we do have data, it appears that, at least in the early 2000s, total assets forfeited through state law amounted to about 20-50% more than what the states got from Equitable Sharing. Those figures undercount the losses to victims of forfeiture, because agencies get, at best, market value for what they seize. So it’s quite possible that each year, more than $1 billion in value is taken from property owners through civil asset forfeiture.

Now that the Equitable Sharing program is being curtailed, state laws will matter more. Which states are best positioned to protect property rights in the new order? Here’s a ranking of states as of January 1, 2015 on citizen protections from civil asset forfeiture, based on the burden of proof for showing that the property was connected to a crime, whether there is an “innocent owner” rebuttable presumption, where the proceeds of asset forfeiture go (when they go to the forfeiting agency, there are more incentives for abuse), and whether the state had put any limits on Equitable Sharing already:

1. North Carolina
2. California
3. Colorado
4. New Mexico
5. Florida
5. Minnesota
7. Oregon
8. Vermont
8. Missouri
10. Nebraska
10. Wisconsin
10. Indiana
10. Maine
14. Kansas
14. Michigan
14. Maryland
17. Connecticut
18. Utah
19. New York
19. Kentucky
21. Louisiana
21. Mississippi
21. Nevada
24. New Hampshire
24. Texas
26. Alabama
27. Arizona
27. Arkansas
27. Hawaii
27. Idaho
27. Iowa
27. New Jersey
27. Ohio
27. Oklahoma
27. Pennsylvania
27. Tennessee
27. Virginia
27. West Virginia
39. Illinois
39. Rhode Island
39. South Carolina
42. Georgia
42. North Dakota
42. South Dakota
42. Washington
46. Alaska
46. Delaware
46. Massachusetts
46. Montana
46. Wyoming

With any luck, Holder’s decision will inaugurate a new round of forfeiture reforms at the state level, as legislators realize that they once again have the power to set policy for their own officials.

Catalonia will hold a de facto independence referendum through regional elections on September 27, 2015. This one will have “real” effect, unlike the 9N, because the Catalan independence parties would form a unity government and set up the institutions of an independent state, ultimately declaring independence at a date yet to be announced.

Just the Facts Ma’am

Dragnet’s Joe Friday may have never uttered those words, but he would be impressed nonetheless by the facts on crime. There was a fascinating piece by Erik Eckholm in yesterday’s New York Times on the Drop-in-crimedramatic reductions in crime over the past several decades. Overall, crime peaked in 1991 and has fallen steadily since then.

 

All of this leads to the big question: why? Is it a change in tactics (e.g., aggressive policing, the “broken window” theory)? Is it a product of an increase in the costs of criminality (e.g., mandatory sentencing and the decision to keep 1.5 million people in prison)? Is it a product of good economic times? Perhaps it simply reflects demographics (e.g., the aging of the population, the decline in teenage pregnancy)? In the end, law professor Franklin E. Zimring (UC-Berkeley) is quoted as describing the search for an explanation as “criminological astrology.”

 

Max Ehrenfreund (Washington Post Wonkblog) has designated the above “chart of the day” as “something of a Rorschach test. Everyone sees what they want to see in it.” That may be something of an overstatement. Certainly, the advocates of the war on drugs, police militarization, aggressive policing and harsh sentencing laws will view it as evidence that their strategies have worked. They will have the challenge of explaining why similar trends are evident elsewhere, including Canada, that have not embraced the US model. And I am not at all certain of how the Left would make sense of the fact that crime has fallen as inequality has increased.

Will the decline in crime have an impact on public policy? Will it lead to a rethinking of police militarization and mass incarceration? I hold little hope given that public opinion seems immune to the facts.

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Even if crime has fallen dramatically, according to Gallup the majority of Americans in most years on record believe that crime is getting worse. As Gallup observes: “federal crime statistics have not been highly relevant to the public’s crime perceptions in recent years.” A public concerned with crime and (willfully) ignorant of the long-term trends will continue to demand an aggressive police presence. And that demand will be met.

The number of people ages 18-64 receiving Social Security Disability Insurance (SSDI) under the Old-Age, Survivors and Disability (OASDI) program has increased dramatically in the recent past. Ana Swanson (Washington Post, Wonk Blog) has brief piece that focuses on SSDI. It includes a map (by Seth Kadish, Vizual Statistix) graphically representing the percentage of beneficiaries who are retired  (the lighter the color, the lower the percentage retired).

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The expansion of disability is partially an exercise in cost-shifting in an economy that is failing to provide jobs. As Swanson notes, some of the increase is a product of aging (the older you get, the more likely it is that you will become disabled). “But it’s also due to efforts by states, often in cooperation with private companies, to move people off of unemployment benefits, which states need to pay for, and onto disability, which is a federal program.” All of this has an additional benefit: the 9 million disabled workers are not counted as unemployed.

The cost shifting strategy has its limits, of course. The SSDI trust fund runs dry in 2016, which will result in a 20 percent reduction in disability payments. In the past, transfers from the larger OASDI trust fund would have covered shortfalls, thereby delaying the pressure for reform. But this week, the House GOP adopted a rule prohibiting transfers from the OASDI trust fund, suggesting that reform of Social Security Disability Insurance may finally be forced on to the agenda.

Over at Reason, Stephanie Slade has a nice, thoughtful piece on whether watching football – providing the NFL and college football programs with revenue – is unethical, given the immense harms to players through traumatic brain injuries and the diseases they cause. A selection:

A person can believe an action is wrong even if she doesn’t believe it should be legally prohibited. As libertarians, we generally respect a person’s autonomy under the law to weigh risks against benefits and decide how to make a living. But we aren’t required to accept or encourage her behavior if we believe what she is doing is objectionable. Even if this particular example [prostitution] doesn’t strike you as immoral, chances are you can think of something you view as wrong without believing it should be illegal. Adultery is often a good example. Could playing professional football be one as well?

Now, adultery is wrong because it is a breach of the marriage contract. Even a “libertine libertarian” could acknowledge that. But I agree that there are some moral obligations that have nothing to do with respecting rights, like being kind and considerate to people, acting with beneficence toward those whom one can help, and, yes, respecting one’s own body and mind. If it’s immoral to do heroin, then a fortiori it’s immoral to play football, because football does much more damage to the mind than heroin, and the mind is what really gives us personhood and moral worth. And if it’s immoral for us to play football, it’s also immoral for us to encourage others to do so through financial incentives.

Would you watch a consensual gladiator show in which someone is killed? Or would you think it barbaric and wrong? If a gladiator show is barbaric and wrong, why not a football game? The argument against such a view might be that we don’t think coal mining or deep-sea fishing are immoral occupations even though they carry above-average risks.

To this I would pose three counterarguments. First, the severity of the risks of playing football were not fully known until quite recently. Thus, players have not been adequately compensated for the dangers. Second, even if they were adequately compensated, it seems wrong to accept extreme risks to oneself even for compensation. Would it be morally OK to pay someone to play Russian roulette for one’s own amusement, or to accept such a bargain? There’s good reason to think not. An elevated risk to one’s life – like the risks carried by deep-sea fishing or coal mining – is different from an extreme risk like that carried by football players (you are likely to develop chronic traumatic encephalopathy). What’s the line where risk moves from acceptable to unacceptable? I don’t know. We have to be comfortable with moral gray areas if that means not implausibly drawing the line at either the black or white extreme. Third, there’s something relevantly different between entertaining yourself by watching people injure or kill themselves (like paying someone to play Russian roulette or fight to the death or play football) and paying someone to do a risky job that results in a valued good or service. In the first set of cases, the viewer risks debasing herself by taking pleasure in the violent, destructive activity itself, not just in the outcomes of that activity (like a fish or a warm house).

Now a defender of football might say she doesn’t enjoy the violence of the game, but Continue Reading »

At the meeting of the American Economic Association in Boston last weekend, there were protests organized by a group calling itself “Kick It Over,” who, as the Washington Post styled it, were “battling for the soul of economics.” Their protest included heckling and disruptions of the talks given by Gregory Mankiw, Larry Summers, and Carmen Reinhart.

For his part, Mankiw wrote a short post on his blog after the conference recounting some of the protesting and responding to the charges of the protesters. He reports that one of them asked him how much the Koch brothers had paid him:

After the first session was over, one of the hecklers came up to me and asked, “How much money have the Koch brothers paid you?”  My answer, of course, was “not a penny.”

Mankiw argues in his post that if he is making mistakes, it is in good faith: “If I am wrong, it is sincere wrong-headedness, not the result of being on some plutocrat’s payroll, as some on the left want to believe.”

That is an important point to make. Assuming bad faith on the part of a person holding a position different from one’s own poisons, rather than furthers, the conversation. It is also, as Mankiw notes, not an effective strategy to get people to change their minds. Insulting people rarely is.

But there is an even more important point to make: Even if it is true that a person received funding from a donor or foundation with a specific point of view, nevertheless his or her arguments, claims, and positions should be evaluated on their merits. One’s motives—whatever they are, good or bad—are irrelevant to the truth of one’s positions and to the soundness of one’s arguments.

This is an elementary point in logic. Attacking the motives of a person is an example of the ad hominem fallacy, or more generally the genetic fallacy—both of which are, in fact, fallacies.

Now, it is true that there might be cases in which attacking a person’s credibility might be effective, and possibly even relevant. The testimony of a witness in a trial who stands to gain depending on the outcome of the trial might for that reason warrant less credibility. But merely pointing out that the source of one’s arguments might be questionable does not suffice to refute those arguments. The arguments might still be sound, after all.

Thus Mankiw concedes too much when he denies having received funding from the Koch brothers. What he should have responded to that protester instead is: “What difference does it make? If I’m wrong, demonstrate my mistake.”

Too often today speculation about people’s motives passes for acceptable rational discourse. But it is not acceptable. Whether you received funding from Charles Koch or George Soros or anyone else, we owe you the respect of assuming that you are a rational and autonomous person presenting a position in good faith. Our job, then, is to evaluate your position, charitably yet critically, on the merits.

Assuming that one’s intellectual opponents must be some combination of naive, ignorant, or evil is easier than attempting to refute their position. But it is not only disrespectful, it is also pointless. You do not know what your opponent’s motives are. One might be the most evil person in the world, but one’s claims might still be true.

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