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  • The Other “Fourth” Worth Celebrating

    July 2, 2015 1:42 PM

    On July 4, we’ll again celebrate the United States of America declaring independence from the British Empire some 239 years ago. As a young nation, the United States broke new ground in 1788 when the thirteen states voted to ratify the Constitution. This document set forth the supreme laws of our land, placing strict limits on the powers of the federal government. Then, in 1791, the Bill of Rights was ratified, adding ten important amendments to the Constitution that clarified the limits on government power.

    Among these first ten amendments is the Fourth Amendment, which secures the “right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures.” This crucial guarantee of individual liberty—expanded in 1868 to protect Americans from unreasonable search and seizures by all levels of government—prevents officials from conducting broad, limitless searches of Americans’ homes and personal property. Our framers wrote the Fourth Amendment based on their experience with British “general warrants” and “writs of assistance,” which King George’s men used to intrude upon colonists’ lives and communications.

  • Vatican Downplays Political Involvement in Climate Debate While Joining Forces with Radical Leftist Naomi Klein

    July 1, 2015 7:28 PM

    Kathryn Jean Lopez reports on NRO’s The Corner that Cardinal Peter Turkson downplayed the political intentions of Pope Francis’s encyclical, Laudato Si’, when he spoke to a “high level discussion” in New York City Tuesday night (June 30).

    According to Lopez, Turkson said that the encyclical was, “Rather than a political or doomsday document, it’s a call to better stewardship.” Moreover: “He also insisted that Pope Francis is not against business and never puts them down in it or elsewhere but challenges business and technology to always be used to help the poor.”

    Cardinal Turkson, president of the Pontifical Council for Justice and Peace and the Vatican’s point man on climate action, was apparently speaking to a group of prominent Roman Catholics, many of whom were probably concerned about what they had read about the papal encyclical. And apparently the cardinal thought that he could get away with what he said because few in the audience had read the encyclical. 

    But earlier in the day, the cardinal addressed the United Nations’ High Level Meeting on Climate Change, convened by UN Secretary-General Ban Ki-moon. To that very different audience, Cardinal Turkson had a very different message: “Overcoming poverty and reducing environmental degradation will require the human community seriously to review the dominant model of development, production, commerce and consumption…. Such a courageous review and reform will take place only if we heed ‘the call to seek other ways of understanding the economy and progress’ (quoted from paragraph 16 of the encyclical). The political dimension needs to re-establish democratic control over the economy and finance, that is, over the basic choices made by human societies.”

    Much of what Cardinal Turkson said was in the political code used by leftist international bureaucrats. If anyone doubts that Pope Francis’s Laudato Si’ is a political rant that advocates dismantling modern industrial civilization, then consider the climate conference that the Vatican is hosting this week. Cardinal Turkson invited Naomi Klein to co-chair the conference.

  • Clarification Regarding the Oregon Governor's Scandal

    July 1, 2015 7:21 PM

    In a February 13, 2015, video interview on The Wall Street Journal’s Opinion Journal, Director of CEI’s Center for Energy and Environment Myron Ebell discussed the recent scandal involving then-Governor of Oregon Jon Kitzhaber and his fiancée, Cylvia Hayes. Myron stated that a number of billionaires had been promoting alternative energy despite the fact that it would raise electricity prices, and that money from energy advocacy groups related to Mr. Steyer, such as the Energy Foundation, was being provided to Cylvia Hayes.

    However, Mr. Steyer’s attorney, Martin Singer, has informed us that while Mr. Steyer’s charitable trusts donated funds to the Energy Foundation between 2009 and 2013, these funds were explicitly restricted so they could not be used for lobbying, legislative or electoral purposes, and they were in no way earmarked for work performed by Cylvia Hayes. Therefore, according to Mr. Singer, Mr. Steyer’s money had no connection to the work that Ms. Hayes performed under the Energy Foundation funding.

  • Supreme Court Ruling that Fair Housing Act Bans Disparate Impact Creates Confusion and Uncertainty

    July 1, 2015 3:50 PM

    The Supreme Court’s June 25 decision in Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project, Inc. creates confusion and uncertainty in multiple respects. In a 5-to-4 decision, the Court ruled that the Fair Housing Act bans certain landlord rental practices and local housing regulations that are racially neutral and nondiscriminatory on their face, if they have a “disparate impact” on a minority group, by excluding minorities at a higher rate than whites, and thus causing a racial imbalance deemed statistically significant.

    In creating such a “disparate impact” prohibition, it failed to follow longstanding principles of statutory construction. And it also failed to provide meaningful guidance about what rises to the level of illegal “disparate impact.” This deeply myopic ruling will have many perverse consequences, as lawyer Paul Mirengoff explains in the article, “In housing case, Justice Kennedy’s eyes are wide shut.”

    As the Court admitted, the Fair Housing Act does not explicitly mention “disparate impact” claims in its ban on discrimination “because of race, color, religion, sex, familial status, or national origin.” But the court read such a prohibition on “disparate impact” into the law, finding that they could be read into the words “otherwise make unavailable” (the law prohibits acts that “otherwise make unavailable ... a dwelling to any person because of race, color, religion, sex, familial status, or national origin.”).

    In lacking any reference to “disparate impact,” the Fair Housing Act is quite unlike the workplace race and sex discrimination law, Title VII, which was expressly amended in 1991 by Congress to include “disparate impact” claims. But the Court read a ban on disparate impact into it anyway.

    In so doing, it violated the basic principle of statutory construction that says that statutes, where possible, should be interpreted to avoid raising even potential constitutional problems. (This overly expansive interpretation of the Fair Housing Act also violates several other principles of statutory construction, which we discussed at this link). The Court itself admitted that “disparate impact” liability, through its focus on racial balance, can sometimes lead to quotas or other unconstitutional uses of race. And in past decisions, it had stated that “racial balancing” is “patently unconstitutional.” See Fisher v. University of Tex. at Austin (2013).

    As the dissent observed, “The Court acknowledges the risk that disparate impact may be used to ‘perpetuate race-based considerations rather than move beyond them.’ ... And it agrees that ‘racial quotas ... rais[e] serious constitutional concerns.’ Yet it still reads the FHA to authorize disparate-impact claims. We should avoid, rather than invite, such ‘difficult constitutional questions.’ ... By any measure, the Court today makes a serious mistake.”

  • Advocating Free Trade, Not Foreign Aid for the World's Poverty

    July 1, 2015 3:25 PM

    A Review of the Poverty Cure Documentary Series

    Poverty Cure is a six part documentary series directed and hosted by Michael Matheson Miller, produced by Acton Media, and was released on December 5, 2014. The film is a project of Poverty Cure, a Christian-based organization that puts together a network of institutions in an effort to defeat poverty through the means of capitalism and entrepreneurship.

    This documentary series is primarily targeted at Christians who are presumably active in their faith-based communities. It proposes that Judeo-Christian values can serve as a beneficial moral code for entrepreneurs and businessmen. The series argues that this moral code will guide and serve as the means for businessmen to run companies effectively to serve the impoverished by providing them work and a place to start businesses of their own.

    The Christian values are reiterated throughout the entire series, and at times the rhetoric distracts from the series’ main argument. However, once the viewer is aware of the organization’s values and their target audience, the Judeo-Christian language seems more reasonable.

    That aside, the series argues its case successfully, convincing at least this viewer that the developing world does not need charity, foreign aid, or philanthropy. Further, it demonstrates that developing countries and poverty-stricken populations require a free market society, open trade, and accessible investment opportunities.

    From the start, the series does well to discredit celebrity campaigns that “combat poverty,” massive foreign aid campaigns, and substantial corporate donations, which is also known as “dumping.” We see that these actions cripple local economies of developing nations. The series uses the example of a Rwandan farmer who provides his local market and community with eggs. When an aid campaign group decided that they were going to continually donate eggs to the village, they effectively drove the farmer out of business. The community then became dependent on egg donations. Consequently, when the aid campaign stopped donating eggs, the community was unable to react to the change and was forced to import eggs from another region. While the intentions may be good, they can actually cause local businesses to lose their customers, subsequently crippling the local economy by stagnating or even reversing business growth.

    The series admits, correctly so, that people start these campaigns because they have good hearts and good intentions; they want to end suffering in the world and help those who are impoverished, so they think the easiest thing to do is donate goods and services to these people. However, Poverty Cure makes it evident that these strategies do not work, and can actually do more harm to the community.

  • Independence Day? Yeah, Right: A Fourth of July Roundup of Federal Regulation

    July 1, 2015 10:47 AM

    Congress is in recess and can’t do any more damage as the Fourth of July approaches, but federal agencies remain in business until they enjoy their federal holiday on Friday.

    That matters. In our annual Ten Thousand Commandments, we show that those federal agencies now do the bulk of lawmaking in the founders’ republic, never mind their having been elected by no one. And over-regulation is a bipartisan phenomenon.

    At calendar year-end 2014, the Federal Register stood at 77,687 pages. The Register is the daily depository of federal rules, regulations, notices and presidential documents. While that’s “only” the sixth highest level ever, five of those six have occurred under the current administration.

    Among those pages, there were 3,554 final rules (with another 2,383 at the proposed stage). Congress passed 224 laws during the year. So the multiple of agency rules over laws was 16. I like to call that multiple the “Unconstitutionality Index.”

    So here we are, at nearly mid-year. What have the agencies been up to in 2015?

    Well, the Federal Register stands at 37,845 pages as of today, July 1.

    The number of final rules issued so far in 2015 is 1,568. Of these, 130 are considered “significant” under E.O. 12866. Often that means they may cost over $100 million annually, sometimes they are considered significant for other more or less dramatic reasons, like when they do something “serious,” “material,” or “novel.”  

  • Are There Broader Implications of the Supreme Court's EPA Ruling?

    June 30, 2015 11:06 AM

    “In a 5-4 decision, the Supreme Court blocked the Environmental Protection Agency’s mercury and air toxics standards, charging that the administration failed to adequately consider the estimated $10 billion it would cost utilities to dramatically cut power plant pollution to comply with the measure,” reported The Washington Times yesterday.

    While the question has been raised about the broader implications of the court’s decision on other EPA regulations, CEI’s William Yeatman, says there is not much broad impact.

    As Reuter’s Lawrence Hurley reported:

    "’The agency must consider cost - including, most importantly, cost of compliance - before deciding whether regulation is appropriate and necessary,’ Scalia wrote.

    “The EPA says the rule, which went into effect in April, applies to about 1,400 electricity-generating units at 600 power plants. Many are already in compliance, the U.S. Energy Information Administration said.

    “The legal rationale adopted by the court is unlikely to have broader implications for other environmental regulations, including the Obama administration's Clean Power Plan that would cut carbon emissions from existing power plants, according to lawyers following the case.

    “William Yeatman, a fellow at the conservative-leaning Competitive Enterprise Institute, said the impact is ‘circumscribed’ due to the ‘narrowness and uniqueness’ of the legal provision the court was examining.”

    As Kate Sheppard points out at The Huffington Post, the lower court now has the opportunity to revisit the case, meaning the rule could still go forward even as the EPA adheres to the Supreme Court’s decision.

  • Reimagining Surface Transportation Reauthorization: Pro-Market Recommendations for Policy Makers

    June 30, 2015 10:15 AM

    Today, CEI published my white paper, “Reimagining Surface Transportation Reauthorization: Pro-Market Recommendations for Policy Makers.” In it, I lay out the case for making some small but important changes to federal surface transportation policy.

    Traditionally, free market fiscal conservatives have advocated for devolving all federal highway and transit programs to the states. To be sure, we at CEI support this eventual goal. Unfortunately, it is wholly unrealistic at this time. But there are still things that can be done to move closer to this direction. We suggest a strategy of “de facto devolution,” which basically involves keeping federal spending steady while increasing the flexibility of states to fund and finance their own highways. To accomplish this, we recommend the following changes to federal highway policy:

    • Repeal the current federal prohibition on states tolling their own Interstate segments for reconstruction purposes, codified at 23 U.S.C. § 129.
    • Uncap or greatly increase the national cap on private activity bonds, currently set at $15 billion, codified at 26 U.S.C. § 142(m)(2)(A).
    • Provide technical and financial assistance to states looking to launch their own mileage-based user fee pilot programs.

    With respect to mass transit, most free market fiscal conservatives have long and correctly held that transit is an inherently local issue. As such, it has no business receiving federal funding, let alone the current 1/5 share of total federal surface transportation spending—especially given the fact that mass transit accounts for less than 2 percent of person trips nationwide. You read that correctly: the federal government currently spends 1/5 of its surface transportation dollars on a mode that accounts for 1/50 of person trips.

     The federal politics of mass transit could be described as an unfortunate mix of parochial and ideological interests battling over non-federal issues. Given that serious federal mass transit spending cuts are at the moment politically difficult, fiscal conservatives and proponents of sound national transportation policy should embrace some more modest goals to rationalize federal mass transit policy. We recommend the following changes to federal mass transit policy:

    • Work to end Highway Trust Fund bailouts and raise public awareness of the huge discrepancy between transit funding and transit use—that 19 percent of federal surface transportation funding is currently directed to a mode that accounts for less than 2 percent of trips nationwide.
    • Roll existing discretionary transit grants programs such as New Starts into the Urbanized Area Formula Program.
    • Realign spending priorities to a fix-it-first-strategy by allowing federal transit funds to be used for maintenance projects.

    Read the whole white paper here.

  • 5 Reasons Why It's Time to Close the Ex-Im Bank

    June 29, 2015 2:43 PM

    The clock is ticking on the Export-Import Bank’s upcoming reauthorization. For the larger part of the past eight decades, Ex-Im’s existence has continued unchallenged and generally conceded as just another example of “the way Washington works.” However, this year is different. Bipartisan support for closing Ex-Im, and ending its crony practices, has grown to an all-time high. Here are the top 5 reasons why it’s time to finally close the Ex-Im for good.


    Ex-Im’s policy is to secure financing for companies that might not be able to secure it in the open marketplace. But that actually isn’t Ex-Im’s only mandate. Ex-Im only secures financing when the benefiting company has a high likelihood of paying back the debt. Companies that meet the former criteria may fail to be eligible under the latter, and vice versa. Companies with the high likelihood to pay back debt probably wouldn’t run into problems securing financing in the first place. In theory and in practice, Ex-Im’s dual mandate is nothing short of a massive contradiction.


    There’s a reason Ex-Im is called “Boeing’s Bank”. It’s because over 40% of Ex-Im’s business “invests” in Boeing. In fact, the top 10 companies financed by Ex-Im swallowed up 76% of its entire 2013 budget. Sound like cronyism to you too? Ex-Im may call itself “pro-business,” but pro-market advocates know what’s behind the curtain.


  • CEI's Battered Business Bureau: The Week in Regulation

    June 29, 2015 2:14 PM

    The big news from last week was the Supreme Court’s King v. Burwell decision, which upheld the IRS’ right to issue regulations directly contradicting legislation passed by Congress and signed by the president. But other agencies also issued more than 60 new regulations covering everything from cotton farmers’ conduct to infant formula.

    On to the data:

    • Last week, 64 new final regulations were published in the Federal Register, after 81 the previous week.
    • That’s the equivalent of a new regulation every two hours and 38 minutes.
    • So far in 2015, 1,511 final regulations have been published in the Federal Register. At that pace, there will be a total of 3,071 new regulations this year, which would be several hundred fewer rules than the usual total of 3,500-plus.
    • Last week, 1,343 new pages were added to the Federal Register, after 1,542 pages the previous week.
    • Currently at 36,780 pages, the 2015 Federal Register is on pace for 74,757 pages.
    • Rules are called “economically significant” if they have costs of $100 million or more in a given year. Thirteen such rules have been published so far this year, two in the past week.
    • The total estimated compliance cost of 2015’s economically significant regulations ranges from $1.50 billion to $1.57 billion for the current year.
    • 125 final rules meeting the broader definition of “significant” have been published so far this year.
    • So far in 2015, 261 new rules affect small businesses; 37 of them are classified as significant. 


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