Schiavo's End

This entry is intended to expand upon an existing thread that I participated in over on Manual Override. I am posting it here because (a) I have a few hyperlinks and those weren't working for me in blogspirit's commentary sections, and (b) the thread is a full week stale now. My principal objection to the outcome of the Schiavo case in that thread centered on what I believe to be inadequate consideration of Terri's interests by the courts.

The subsequent comments from 3XHAR and additional input from Salvius do not dissuade me from my objections. Salvius notes the abundant attention paid to the case by courts and others and reports that "Every single time a court has been asked to make the decision, they have decided that Terri doesn't want to live." My objection of course is not with the quantity of attention or decisions, but rather the quality. I believe that this is a classic garbage-in garbage-out scenario in which initial one-sided findings irrevocably skewed subsequent proceedings. Again, my contention is that it was the courts that made Michael Schiavo and his lawyers the exclusive voice for T Schiavo's wishes and that T Schiavo has not had the benefit of independent representation. Such painstaking agency for the disabled is not usually necessary, but this is not a "normal" case like siblings quibbling over grandma's intravenous drip during her last month of Alzheimer's. What is being discussed is authorization to kill someone who was not dying, and in such extraordinary circumstances the lack of independent consideration on behalf of the person to be killed is bewildering.

I think that this last point is critical, because deciding which judicial criteria to use depends on understanding the fundamental nature of the case. I allege that this is a "death case," albeit a civil one rather than criminal. Either way, a citizen is being condemned to death based on a court order. I understand that some may object to this characterization, and prefer to say that the court merely mandated the removal of a feeding tube. But if that were truly the full extent of the court order then it would be okay for someone else to go in and administer Gatorade by eyedropper, or give a glucose solution intravenously. I am willing to wager that this is not the case.

If, as I allege, the T Schiavo matter is a "death case," then the "clear and convincing evidence" standard mentioned by Salvius is insufficient, and the courts are obliged to use "beyond a reasonable doubt" as their decisionmaking standard. This is not a new judicial principle that is suddenly to be invented. Rather, it is historically understood as the threshold of evidence required by American justice for ordering death, and T Schiavo is as deserving as anyone else of the benefit of existing due-process principles. If she were to receive independent representation and then it were found beyond a reasonable doubt that yes, she preferred death to a lifetime of profound disability, then my objections disappear. But to accept the current court decisions as adequate is to say that T Schiavo is among a class of persons less privileged before the law than even our worst criminals. Respectfully, I dissent.

Doyle and taxes

This is a topic that Joseph has already touched on, but there was a corner item in the business section of Friday's Wisconsin State Journal that caught my eye. It starts:

Wisconsin's sales tax laws have cost Lands' End both sales and jobs, an executive of the Dodgeville apparel company told the Legislature's Joint Finance Committee on Thursday.

Sounds okay so far, pending specifics.

Karl Dahlen, vice president and senior legal officer of Lands' End, was one of several Wisconsin retailers urging support for a proposal in Gov. Doyle's budget that would make it easier for the state to collect sales tax on mail-order and Internet purchases from other states.

What the newspaper is referring to, but is not doing a very good job of explaining, is Doyle's proposal to tax in-state residents for out-of-state purchases. It is not an effort to collect taxes on "purchases [originating] from other states," which is one way of reading that vague sentence.

Now, already I'm having difficulty reconciling just these two paragraphs. The first paragraph declared that there was a problem for Lands' End because of the state's tax collections. How, exactly, would expanding the state's tax collection powers assist Lands' End?

Customers have said they've taken their business to other companies because of the sales tax Lands' End has collected, Dahlen told lawmakers. That has led to "a loss of tens of millions of dollars of revenue in our direct-to-consumer business," he said in a statement.

So instead of asking for relief from onerous sales taxes so that local customers can help grow the business, this corporate clown asks for the scope of taxation to be expanded. Dahlen is either a shill, a moron, or extremely cynical, because he neglects to consider the entirely predictable course of Doyle's new tax initiative. Is there anyone above the age of thirty who is so naive as to think that if Doyle can actually pull this off, that no other governors would jump at adding this revenue stream in their own states? Dahlen thinks Lands' End is losing business now, because of sales tax on one state's customers? How much business will they lose when forty-five other states begin taxing their residents on Lands' End purchases? And how is it that Lands' End had managed to expand and prosper for the last forty years, but now suddenly needs the state to step in?

What Governor Doyle is asking for, and what Dahlen is supporting, is very much like a tariff. And when the states realize that they can collect these "tariffs" without Congress moving to stop them, we will have a form of interstate protectionism. The Constitution grants Congress the power to regulate interstate commerce in Article 1, Section 8, and the Supreme Court of the United States has many times considered and often curtailed efforts by states to either export their tax burdens (e.g., Louisiana's "First-Use Tax," Maryland v. Louisiana, 1981) or erect trade barriers (Bellas Hess v. Illinois, 1967). I especially appreciate these lines from Justice Stewart:

The very purpose of the Commerce Clause was to ensure a national economy free from such unjustifiable local entanglements. Under the Constitution, this is a domain where Congress alone has the power of regulation and control.

And who, pray tell, has benefited from interstate free trade? Consider this University of Missouri law school commentary:

In Quill Corporation v North Dakota (1992), the Court looked at a North Dakota "use" tax applied to sales by out-of-state corporations (primarily catalog companies such as L. L. Bean and Land's End) to North Dakota residents.

(Emphasis mine). The Court struck down the North Dakota "use tax."

Social Security's "bankruptcy"

I shall use dgiese's comment as an excuse to expand on the trust fund post. Mister Giese is critical of politicos who use the word "bankruptcy" to describe Social Security's situation.

I agree that the word is inapt. Social Security does, after all, currently run twelve-figure annual surpluses (payroll taxes less benefit payments). On that score, it hardly seems bankrupted. And yet looking forward in time and computing the present value of the trust fund and all the program's anticipated revenues against liabilities (again, all in terms of present value), the best estimate is that the program is underfunded by $10.4 trillion. Bankrupt? Maybe, but in that sense when has the program ever not been bankrupt? Either way, the word just isn't a good fit for what we're talking about.

Here's an interesting thought experiment, and perhaps it will help in thinking about Social Security's future. Fast forward to 2018, or whatever year it is when payroll taxes become insufficient to cover benefit payments. This is the fiscal year in which the program starts using the T-bills from its trust fund. So let's be precise. The Social Security functionaries send a bundle of their long-stashed T-bills back to the Treasury, demanding money in return with which to pay retirees. The federal government has five choices for coming up with that money, of which only the first three are likely to be used:

(1) Cut it from some other program.
(2) Increase taxes.
(3) Increase debt (by finding someone to buy the T-bills).
(4) Print the money (inflate the currency).
(5) Sell (privatize) a real public asset (e.g. national forest).

Some combination of the above can be used, but those are the choices.

Now, suppose again it is 2018, but disaster strikes the Social Security bureaucracy. Barbara and Jenna Bush, armed with flamethrowers, infiltrate the trust fund bunkers and incinerate every last trust fund T-bill. How does the government, now without the trust fund, come up with the money to make up the year's difference between payroll taxes and benefit obligations? The federal government has five choices:

(1) Cut it from some other program.
(2) Increase taxes.
(3) Increase debt (by finding someone to buy new T-bills).
(4) Print the money (inflate the currency).
(5) Sell (privatize) a real public asset (e.g. national forest).

This is what people mean when they say the trust fund is bogus. The government is faced with the exact same options, with the exact same shortfalls, whether the trust fund T-bills are used or vanish utterly. There is no difference.

At minimum, I recommend chanting the following aloud: "The trust fund is not an asset. The trust fund is not money. The trust fund is not wealth." It won't fix the problem - but at least when the crunch comes you'll understand why.

Many smart people don't get this

It is amazing, but I am willing to bet that most people still fail to understand the fundamental nature of the American Social Security system and its vaunted trust fund. As we are told time and time again, sometime before 2020 Social Security expenditures will exceed payroll tax revenues. On the one hand, some people (many of whom are Democrats) say that this is not a problem because of the $3.5 trillion-odd trust fund that has been, and continues to be built up to satisfy these obligations. Social Security is thus good until at least twenty-fortysomething, if not longer. On the other hand, some people (many of whom are Republicans) say that the trust fund is not much of a trust fund at all, consisting entirely of "I.O.U.s," therefore the years of painful budget reckoning are nearer. Charles Krauthammer is a specific example of someone in the latter camp:

Let's start with basics. The Social Security system has no trust fund. No lockbox. When you pay your payroll tax every year, the money is not converted into gold bars and shipped to some desert island, ready for retrieval when you turn 65.

Matthew Yglesias seems to reside in the former camp. Understanding, correctly, that the IOUs are Treasury Bills, he responds to Krauthammer:

By this standard, not only is my bond porfolio not real, my bank account isn't real, and, in fact, the cash in my pocket isn't real. The only "real" money, apparently, is stacks of gold bars. Now once upon a time, your U.S. currency was redeemable for gold bars and, thus, one might consider it real. Alternatively, perhaps U.S. currency in the gold standard days was a "mere I.O.U." Either way, we've been off the gold standard for some time now, and people would be alarmed to learn that this means their money is fake. Does the Post pay Krauthammer in dubloons?

Clever, no? But the big thing that Yglesias misses completely is that the paper he owns is fundamentally different from Social Security's paper. Matthew's paper money, paper bonds, and paper bank statements are legitimate, tradeable claims on money or services from others. Social Security's paper is issued by the federal government, and held by the very same federal government. Thus, the government holds a claim on itself. Social Security's paper is at best a recordkeeping aid between the Treasury and Social Security, but is no more a government asset than the notes I write myself so I remember to transfer money from savings into checking.

To summarize: When someone writes an IOU and hands it over to you, you have an asset. When that same person writes an IOU and keeps it for himself, he has a reminder. What the Social Security trust fund has in its vaults is file cabinets full of reminders (nod to David Frum).

If you grasp this concept, then you understand something that many politicians, journalists and commentators plainly do not.

Bumper tyrant

Got stuck behind some joker this morning, whose one of seven stickers proclaimed:

I'm one of the 94% of Americans who do not hunt, and I vote.

First off, count me mightily unimpressed by the "and I vote" punchline. Because I suspect that this is one of those people who would curl into a fetal position were I to insist upon showing a photo identification in order to vote, or to actually register before the day of the election. So I'm not buying the braggadocio regarding the voting prowess.

Secondly, I think pro-mob-rule bumperstickers are uncool. "I am in the majority, so your liberty and privileges are subject to my whim." Of course this same person had a pro-family-farmer license plate frame. Well, I'm one of the 98% of Americans who are not family farmers...