Nanny State

CEI General Counsel Sam Kazman about to take a spin in Google's self-driving car. (Photo by Marc Scribner)

CEI General Counsel Sam Kazman about to take a spin in Google’s self-driving car. (Photo by Marc Scribner)

For the past several years, I’ve been writing about highly automated vehicles — widely referred to as driverless cars — and the huge potential they have in reducing injuries and deaths (over 30,000 Americans die on the roads every year), improving mobility for the disabled and elderly, reducing the drudgery of commuting, and helping the environment… provided policy makers don’t mess it up with onerous laws and regulations (see here, here, here, here, here, here, here, and here).

Recently, I appeared on Fox Business Network’s libertarian news-talk program The Independents to discuss automated vehicle developments, both technological and political. You can watch it here:

Today, CEI released a white paper I’ve authored, “Self-Driving Regulation: Pro-Market Policies Key to Automated Vehicle Innovation,” that goes into much more detail in arguing for regulatory restraint in order to allow the eventual consumer roll out to occur as timely and as cost-effectively as possible. In it, I provide a brief historical overview of automated vehicle development, explain current developments in the legislative and safety regulatory spaces, and offer a number of recommendations to policy makers.

So, why should you care about automated vehicle regulation? The short answer: bad regulation has the potential to kill. One of the biggest risks is getting the rules wrong and unnecessarily delaying consumer availability and/or increasing the prices faced by consumers. If automated vehicles are indeed safer than current manually driven vehicles, any delay or price increase means consumers will be stuck driving more dangerous vehicles. The stage is set for a classic “Death by Regulation” event: well-meaning lawmakers and bureaucrats deny safer products to consumers out of an overabundance of caution, translating to increased injuries and deaths. That is why it is so important for regulators not to mess it up.

Even if you aren’t sympathetic to free markets and libertarianism, I suspect there the first two-thirds will be of interest. Read the full thing here.

Post image for Pseudoscience and Clickbaiting Results in Beer Fear

There’s a lot of pseudoscience about food out there. From genetically modified crops to organic foods to corn syrup, to preservatives, passionate opinions abound, but well-reasoned, well-researched reporting on the issues is scarce. Normally, I selectively address the more egregious offenses and ignore the rest. But once in a while, an article comes along that is so misinformed, so hyperbolic, and so viral that it cannot be ignored. When such an article maligns one of my favorite food items, beer, I am duty-bound to come to its defense.

Recently, turned a post by the blogger Vani Hari, better known as the “Food Babe,” into the worst kind of clickbait with the sky-is-falling headline, “8 Beers That You Should Stop Drinking Immediately,” which has been making the rounds on social media networks. But rather than exposing any dangers in beer, what Hari does reveal is that she does not understand the brewing process, how additives and ingredients function throughout that process, or how the beer industry is regulated.

The first warning sign that the Food Babe’s information may be dubious is that one of her main sources was the book, Chemicals Additives in Beer, published by the Center of Science in the Public Interest (CSPI), which has a poor record when it comes to being scientifically sound. As food historian Maureen Ogle noted in her rebuttal (which I highly recommend):

[T]his one fact set off my alarm bells: She [Hari] relied on information from the Center for Science in the Public Interest. If you’ve read Ambitious Brew, you know that I have zero patience with CSPI. For thirty years, that group has railed against the alcohol industry and lobbied for neo-prohibition. As a source of information, it’s untrustworthy, unreliable, and constantly shows a somewhat shocking disregard for science (weird, given the group’s name).

Moreover, I couldn’t find a copy of the book anywhere or even a listing that might demonstrate its existence.

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Post image for Victory for Maryland Parents and Consumers: Energy Drink Ban Voted Down

A bill that would have banned the sale of energy drinks for minors in Maryland was recently voted down in committee almost unanimously. The bill was introduced after the death of 14-year-old Anais Fournier, which was reportedly linked to the consumption of energy drinks, and several news stories linking energy drinks to an increased number of hospitalizations fueled the panic over energy drinks potential hazards. However, Maryland lawmakers, to their credit, did not rush to legislate on a matter that would affect all Marylanders based on a few anecdotal cases.

While it’s understandable that parents would want lawmakers to do something to protect their children from potentially hazardous products, legislating based on anecdotal evidence isn’t the answer. In fact, a ban would likely do more harm than good. As Maryland Del. Doyle Niemann (D-Mount Rainier) told me over email, “There may be issues with energy drinks, but I agree that there are limits to how much can and should be done legislatively.”

On March 15, after hearing the concerns of citizens and business owners in Maryland, the House Economic Matters Committee rejected the bill 22-1. Despite the emotional testimony of the parents of the late Anais Fournier, lawmakers did not seem convinced that a ban was appropriate or that the scientific case against energy drinks is conclusive.

The bill’s penalties were excessive and unreasonable by any standard. The proposal—which defined “energy drinks” as beverages containing 71 milligrams or more of caffeine in a 12-ounce container as well as other ingredients like taurine, guarana, panax ginseng, inositol or L-carnitine—would have made selling energy drinks to minors a crime with the punishment ranging from $500 for the first offense to $2,000 for subsequent offenses, and up to $20,000 for providing discounted or free energy drinks to anyone under the age of 18. Minors themselves could be fined up to $100 if caught in possession of energy drinks.

Despite all the scary headlines, there is no actual evidence that the energy drinks are harmful when moderately consumed. As I noted recently in The Baltimore Sun, the U.S. Food and Drug Administration conducted an investigation in 2012 and found no reason to take further action against the products. While this doesn’t mean they are perfectly safe in any quantity for every consumer in all circumstances, it means that the agency doesn’t see them as a threat to public health. And as noted in a subsequent letter to the Sun, the assertion that energy drinks are dangerous to the 10 percent of the population with undiagnosed heart conditions seems unlikely. Were that the case, we’d expect to see many more energy drink-related deaths given the huge increase in energy drink consumption in recent years.

Energy drinks, consumed in a great enough quantity, could pose potential health risk, but that is true for all consumable goods. The only way to protect children from the dangers of certain foods or beverages is for parents to give them guidelines about proper nutrition to help them make responsible consumption decisions now and in the future.

New Jersey’s anti-bullying law, which applies to the state’s schools and universities, is so overly broad that a fourth-grader was punished just for noting, in response to a question, that a classmate had suffered from head lice. A civil-liberties group called the Rutherford Institute is now representing that student in a First Amendment challenge to the law, notes the Newark Star-Ledger in an article titled, “Civil liberties organization asks federal court to declare NJ’s anti-bullying law unconstitutional.” Another civil-liberties group, FIRE, has also concluded that the law violates the First Amendment.

The Rutherford Institute explains:

Attorneys for The Rutherford Institute have asked a federal court to declare a New Jersey anti-bullying law unconstitutional in light of its chilling effect on students’ free speech rights. The Institute’s latest brief, which counters a move by the New Jersey Commissioner of Education to have the lawsuit dismissed, argues that the state’s enforcement of the anti-bullying act represents a violation of students’ rights under the First and Fourteenth Amendments to the U.S. Constitution and the New Jersey state constitution. Institute attorneys filed the First Amendment lawsuit in Lim v. Board of Education of the Borough of Tenafly in December 2013 on behalf of a 4th grade boy who was punished under the act for truthfully stating that a fellow student had head lice.

“What school officials conveniently seem to keep forgetting is that students do not shed their constitutional rights at the schoolhouse gate,” said John W. Whitehead, president of The Rutherford Institute and author of A Government of Wolves: The Emerging American Police State. . . Rutherford Institute attorneys argue that while the purpose of the law is admirable, the law’s scope is unconstitutionally broad and the language is too vague to give parents or students adequate notice about what statements will or will not be prohibited.

Highlighting the potential absurd applications of the law, Institute attorneys draw attention to an incident that took place in September 2011, when a 4th grade boy was punished under the act for correctly stating that a fellow student had head lice. A few days after a note was sent home to the parents of a class of 4th grade students, warning them that one of the students had head lice, several students were sitting at a group table completing an assignment together. During the discussion, one student asked a female student why she had dyed her hair. After she failed to respond to the question, one young boy, L.L., correctly replied that she had done so because she was the student who had head lice. The female student complained to the teacher who in turn instructed L.L. to apologize, and the class lesson continued uninterrupted. The teacher then reported the incident to the school’s “Anti-Bullying Specialist,” who filled out a bullying report and informed the Superintendent about the incident. As a result of the finding, the student was forced to undergo a special sensitivity assignment, and the entire class was reminded about the need to be kind to each other, which further embarrassed the fourth grader. L.L.’s parents appealed the bullying determination first with the local school board, and then with the state Board of Education, both of which affirmed the decision.

Arguing that the statute punishes any speech deemed “hurtful,” even if factually true and non-disruptive, attorneys for The Rutherford Institute filed a First Amendment lawsuit in federal court, asking that the statute be struck down, and that students like L.L. not be penalized in accordance with the statute for exercising their constitutional rights.

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Former Competitive Enterprise Institute Research Associate Michael Mayfield provided invaluable assistance with this post.

Matt Drudge’s widely discussed tweet that he has already paid Obamacare’s “liberty tax” highlights the uncertainties the self-employed face both from the health care law and the tax code in general. As pointed out by an editorial in Investor’s Business Daily, “self-employed entrepreneurs ranging from Drudge to small-shop proprietors and independent contractors have long been aware of the requirement to estimate their tax liability and send a quarter of it in every three months, and that this amount includes ‘other taxes’ such as the ObamaCare opt-out penalty.”

The threat of the IRS penalty from Obamacare’s individual mandate, perhaps more than the president yukking it up with comedians like Zach Galifianakis, may be driving the apparent pickup in enrollment in advance of the law’s March 31 deadline. “Worries over fines aid health insurance sign-ups,” reads the headline of a March 23 Wall Street Journal article. Even if the penalty this year is relatively small for many Americans, fear of the IRS can be a great motivator.

The good news — for Drudge and other Americans who don’t want to buy an Obamacare-compliant plan due to personal objections or just plain cost — is that in many cases there is a practical escape hatch from the IRS penalty. And this option may end up offering better and more affordable care than Obamacare. The only catch is you’ve got to have a little faith.

Buried in Section 1501 on page 148 of the so-called Patient Protection and Affordable Care Act is an exemption from the individual mandate for a “health care sharing ministry,” a group whose members “share a common set of ethical or religious beliefs and share medical expenses among members in accordance with those beliefs.” For any member of such group, the law says, “No penalty shall be imposed.”

It’s somewhat of a mystery how those pushing the law allowed such a potentially large exemption to the individual mandate to be inserted in the first place. This is definitely a case in which the law’s supporters, four years after the law has passed, don’t seem to know what’s in it. But fortunately, many Americans are finding and utilizing this escape hatch.

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Yesterday, Arizona Governor Jan Brewer vetoed a bill that would have made clear that the state’s Religious Freedom Restoration Act (RFRA) applied not just as a defense to a lawsuit brought by a government entity, but also as a defense to lawsuits brought by a private party under a state statute, or using a cause of action created by state law. Under RFRA, no government action (including a damage award in a lawsuit) can “substantially burden” religious freedom unless it is “the least restrictive means” to further a “compelling interest.” The bill hardly seems like a radical change, since damage awards in private lawsuits already constitute “state action” for purposes of the First Amendment, under the Supreme Court’s decisions in Snyder v. Phelps and New York Times v. Sullivan. The bill just applies the same principle to RFRA, and, indeed, the bill’s enactment might merely have given the state’s RFRA the same meaning that other jurisdictions’ RFRA’s already have by judicial construction. The bill did not even mention sexual orientation, did not single out gays, and probably would have had its greatest effect in other areas.

The media, including the Washington Post and the New York Times, have fundamentally distorted what that bill, SB 1062, vetoed by Gov. Brewer, would have done, by claiming that it would have “allowed” a broad range of discrimination. It was written narrowly enough (and did not even mention gays) that it conceivably might not have legalized any additional discrimination against gays at all. It might have had more effect as to refusals to serve other groups disapproved of by religious fundamentalists, like cohabiting unmarried couples, although even that is not guaranteed. (Disclosure: I support both gay marriage and religious liberty, and CEI did not take any position on the bill.)

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Post image for Reining in the Executive Branch Bureaucracy, Part 7: Recognize and Reduce Indirect Costs of Regulation

Since the Federalist Papers, America has debated “Energy in the Executive.” But President Obama’s 2014 agenda framed by his State of the Union address heralds a class warfare agenda, one fusing an “income inequality” theme with federal industrial policy and other activism.

When I can act on my own without Congress, I’m going to do so,” Obama promises. This spend-and-transfer fixation makes Americans poorer and dependent except for the lucky few running things.

Others have argued for federal budget rationality as essential to any anti-poverty agenda. This series proposes a greater prosperity enhancing opportunity, streamlining the nearly $2 trillion regulatory state and ending the uncertainty, wealth destruction and job loss it creates.

Accountability in government and basic fairness require acknowledging indirect effects of regulation and minimizing negative impacts.

In the series “Cataloging Washington’s Hidden Costs, it was noted that indirect costs may often be omitted from compliance-focused regulatory direct cost estimates, such as the engineering costs of controlling an emission.

But if indirect costs are regarded as too difficult to compute, then government cannot credibly argue that compliance is somehow not overly burdensome.

If Congress continues to allow regulators to overlook entire categories of indirect costs (such as product bans, disapprovals of pipelines, employment impacts or antitrust regulation’s re-orienting of entire industries), then regulations can tend toward such hard-to-quantify types, imposing grave burdens and dampening productivity. Under such scenarios, many regulations could be expected to feature bans or disapprovals so that regulators would avoid appearing to impose high direct regulatory costs despite hardship inflicted.

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Post image for Should States Legalize Sports Gambling? Yes!

With Super Bowl XLVIII in the history books, all that remains now is for the losers to lick their wounds and for the victors to collect their spoils. The Seattle Seahawks will return home to their adoring (and loud) fans while the winners of friendly bets and office pools will collect their winnings. Of course, in most states wagering on sports is illegal. Should it be, or is it about time that states legalized the widespread activity of sports gambling?

The short answer: It should never have been banned in the first place. Legalization would protect gamblers from the dangers of the black market, increase revenues for cash-strapped state governments, and restore adult Americans’ right to decide how to spend their own money. The question of whether some gambling should be legal has long been settled. All but one state — Hawaii — has some form of legalized gambling. All but six states have lotteries, in which almost 60 percent of Americans bought tickets in 2013. Gambling is, quite simply, in our nature. People have engaged in it since the beginning of recorded history and about 86 percent of Americans reported gambling at least once in their life, according to a Gambling Impact and Behavior Study done in 1999.

Bans don’t work: Despite the de facto ban on Internet gambling, an estimated 70 million Americans still wagered online in 2010. And, despite the fact that sports wagering is only legal in four states, an estimated 50 percent of American adults all across the nation put money down on the outcome of this past weekend’s Super Bowl. Bans on sports gambling make criminals of ordinary people, put them in potentially dangerous situations in dealing with bookies, and make states miss out on potential revenue.

Legalized gambling = increased tax revenue: Nevada generated upwards of $20 million in tax revenue from sports wagering in 2012. Only three other states — Oregon, Delaware, and Montana — reap the benefits of legal sports wagering. For an idea of the potential revenue states could gain from legalized sports wagering, consider this: more than $2.5 billion is illegally wagered during the three-week period of “March Madness” last year, according to the FBI.

Gambling bans don’t protect the sport: Some argue sports gambling hurts the game. They appear to believe players will throw games if they bet on opponents. But as we have seen, bans do not stop sports betting, they merely drive it underground where it attracts a criminal element and cannot be policed effectively. To the extent that legalization makes gambling a transparent activity organized by businessmen, rather than a black market run by criminals, legalization should make it easier for teams, leagues, and courts to police misconduct by players and coaches.

As we have seen in the past, Americans are going to continue wagering on sports whether or not it is legal. The real question is: Do we want to have this activity go on in the shadows of the black market or have it occur in a legal market where it can be monitored and participants can be protected?

tsa-nun-screeningPolitico Magazine has a disturbing article by former transportation security officer Jason Edward Harrington. At least it would be disturbing if it wasn’t largely just a confirmation of what many of us had long suspected. (Titled “Dear America, I Saw You Naked: And yes, we were laughing. Confessions of an ex-TSA agent.”) Harrington details the dim view the Transportation Security Administration holds of traveling public, in addition to their willful use of ineffective screening techniques and technologies, which may or may not be deployed by spiteful TSOs to humiliate or delay a passenger who rubs them the wrong way. A taste:

We knew the full-body scanners didn’t work before they were even installed. Not long after the Underwear Bomber incident, all TSA officers at O’Hare were informed that training for the Rapiscan Systems full-body scanners would soon begin. The machines cost about $150,000 a pop.

Our instructor was a balding middle-aged man who shrugged his shoulders after everything he said, as though in apology. At the conclusion of our crash course, one of the officers in our class asked him to tell us, off the record, what he really thought about the machines.

“They’re shit,” he said, shrugging. He said we wouldn’t be able to distinguish plastic explosives from body fat and that guns were practically invisible if they were turned sideways in a pocket.

We quickly found out the trainer was not kidding: Officers discovered that the machines were good at detecting just about everything besides cleverly hidden explosives and guns. The only thing more absurd than how poorly the full-body scanners performed was the incredible amount of time the machines wasted for everyone.

Read the whole thing.

CEI has been fighting TSA’s unjustifiable use of “advanced imaging technology” (AIT, the official term for the strip-search machines in airport screening lines), filing a coalition amicus brief in support of the Electronic Privacy Information Center’s lawsuit that led to a court-ordered rulemaking on the use of AIT scanners.

We later submitted formal comments to the TSA on the proposed rule in June that were joined by former American Airlines CEO Bob Crandall and are still waiting for the agency to produce a final rule. In our letter, we argue that the TSA is still not complying with the Administrative Procedure Act, nor the court order requiring it to comply with the APA, and that it fails to properly analyze issues of risk or conduct a legitimate cost-benefit study.

Based on what Harrington claims in his essay, our worst suspicions have been confirmed: the TSA is an ineffectual, lawless agency. It should be abolished as quickly as possible, with passenger screening responsibility being reverted to the airlines and airports, as it had been for three decades until the entire country briefly went insane following the September 11 terrorist attacks. Both airlines and airports have much stronger incentives to both screen effectively and minimize passenger inconvenience and discomfort than bumbling government bureaucrats.

Read the comment letter here for details. In addition, see this op-ed co-authored with Crandall for background on the issues at stake.

Post image for Reining in the Executive Branch Bureaucracy, Part 2: Regulatory Benefits? Maybe Not

Since the Federalist Papers, America has debated “Energy in the Executive.” But President Obama’s 2014 agenda framed by his State of the Union address heralds a class warfare agenda, one fusing an “income inequality” theme with federal industrial policy.

When I can act on my own without Congress, I’m going to do so,” Obama promises. This spend-and-transfer fixation makes Americans poorer and dependent except for the lucky few running things.

Others have argued for federal budget rationality as essential to a true anti-poverty agenda. This series proposes a greater prosperity enhancing opportunity, streamlining the nearly $2 trillion hyper-regulatory state and ending the uncertainty, wealth destruction and job loss it creates.

The basis of regulation is the belief, in my view discredited, that government actors are non-self-interested and that political markets are fairer than private markets. Regulations, as currently construed, often don’t work. One instance is expressed by John Tamny in Forbes:

The banking crackup from 2008 is the latest evidence that regulations are much more than worthless. We implicitly ask the charitably average people who migrate toward regulatory jobs to see the future, but if they could, they wouldn’t be regulators. Regulations on their very best day severely distract the productive while inhibiting the profit motive, and then on their worst they lead to tragedies of the Bernie Madoff variety for creating a false impression that qualified people are minding the store.

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