The Real Emergency Isn’t About the Wall; It’s About the Separation of Powers.

US president Donald Trump recently declared a “national emergency” under which he intends to divert money from the US Department of Defense’s budget and use it to build a wall on the US-Mexico border.

No biggie, Trump said as he announced the “emergency.” Happens all the time (59 other times since 1976, to be exact).  Purely routine.

But it’s not routine at all. It is, in fact, a declaration of presidential dictatorship that shreds the US Constitution’s separation of powers requirements.

Most presidential emergency declarations have been either on matters supposedly requiring immediate action which Congress could be expected to subsequently approve (for example, George W. Bush’s 2001 declaration of emergency in the wake of 9/11), or pursuant to policies already approved by Congress (for example, specific sanctions on countries already condemned by Congress to general treatment of that type).

Trump’s declaration is different — but there is applicable precedent to consider. We’ve been down this road before, just not quite so far.

In 2013, Republicans in Congress flirted with refusal to raise the  “debt ceiling” — a limit on how much money the federal government allows itself to borrow.

As  a deadline approached after which the US government would be in default to its creditors,  House Democrats urged president Barack Obama to ignore Congress  and raise the debt ceiling by emergency decree.

How are the two situations alike?

Article I, Section 8 of the US Constitution assigns the power to “borrow Money on the credit of the United States” exclusively to Congress.

Article I, Section 9 of the US Constitution similarly empowers Congress to decide how money may and may not be spent: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.”

By unilaterally raising the debt ceiling, Obama would have become an outlaw, an extra-constitutional dictator rather than a president. Republicans pointed this out at the time. Fortunately, an 11th-hour deal averted the possibility of Obama following his co-partisans’ advice.

By asserting the “emergency” power to spend money on  a project that Congress has explicitly declined to fund by appropriation (multiple times, in fact), Trump has effectively resigned the presidency and declared himself an absolute monarch.

And THAT, friends, is a REAL emergency.

If Congress has any desire to save what’s left of the Constitution — and any political will to act on that desire — the obvious, immediate, and absolutely necessary next step is the impeachment of Donald Trump and his removal from the office of President of the United States. Nothing less will suffice, and the case against him is airtight.

Over the course of more than two centuries, the Constitution has frayed, and sometimes broken. Maybe it’s time to let it go. If that’s the case, I’d personally rather it gave way to something better than the banana republic style dictatorship the American presidency has descended toward in recent decades.

If Congress doesn’t make Trump the bottom of that slide, there is no bottom, and we are doomed to suffer through a dark new era of uncontested presidential tyranny.

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My Personal Trade Deficit Is Killing Me – or So Trump Would Have You Believe

A few days ago, my lunch was as follows. Besides some Chilean grapes I had acquired via Lucio and a host of other, unknown middlemen (gracias al Mano Invisible), I had some homemade Oaxaca-style cheese and some homemade tortillas I purchased from local people who peddle their products along the beach road. (Oh, yes, I seasoned my quesadillas with some very tasty locally made salsa picante de habanero y pina.) Well, so what?

You see, it got me to thinking. I am running a terrible trade deficit with the local Mexicans. I keep giving them pesos, and all they give me in return are delicious foods and very helpful labor services from time to time. As President Trump would tell you, this is an awful situation for anyone to be in.

If I’m ever going to be as prosperous as Trump is making the USA, I will have to find a way to get the local people to buy my consulting services, while I buy nothing from them. By accumulating a pile of worthless pesos—as worthless as the foreign currency payments that U.S. exporters gain when they only hoard them, rather than using them directly or indirectly to finance imports—I will make myself Great Again.

I may get pretty hungry in the process, but what the hell, I’ll be as Great as Trumpian America. After all, as any mercantilist will tell you—and Trump tells you incessantly—the only thing that matters is getting a lot of money by selling to foreigners, whereas getting a lot of foreign-made goods and services is a terrible thing.

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Deadlock and Partisan Bitterness

Why does American politics seem so deadlocked?  The media mostly focuses on issues where Democrats and Republicans refuse to compromise because they strongly disagree: immigration, guns, health care.  But American politics often seems deadlocked even when both parties agree.  For example, supermajorities of both parties want to protect DREAMers, but they’ve never reached an agreement to do so.  How is this possible?

1. Transactions costs.  Hammering out a deal is hard work, so many mutually beneficial deals don’t happen.

Critique: Economists routinely appeal to these alleged costs, but how high can they possibly be?  Seriously, why should it take more than a single day for the DREAM Act to become a law?  Vote, vote, sign, done.

2. The hold-out problem.  Suppose we agree that X is good, but you want X a lot more than I do.  In this situation, it makes sense for me to demand some “compensation” from you even though we basically agree.

Critique: This might make sense for a year or two.  But if we’ve failed to reach an agreement after many years of negotiation, you’d expect both sides to moderate their demands to cut their losses.  Yes, they could conceivably be investing in their reputations for intransigence to secure favorable terms in the future, but does anyone seriously expect to see the day when one party finally submits to the other?

3. Insincerity.  For example, perhaps Republicans only claim to want to protect DREAMers in order to seem nice and reasonable.  In fact, however, they never genuinely favored the DREAM Act in the first place.

Critique: This is often plausible, but it’s hard to see it as a general explanation.  Politicians have clear incentive to lie about their goals, but why would average citizens bother to lie in anonymous polls?

4. Partisan bitterness.  The two main parties intensely dislike each other.  Like a quarrelsome couple, they could find something to fight about at a fancy restaurant on Valentine’s Day.  As a result, the two parties have trouble cooperating procedurally even when they agree substantively.

Critique: This is my preferred story.  What I wrote about divorce a decade ago cleanly explains political deadlock as well:

Unfortunately, the Coasean argument overlooks a pretty obvious fact: Couples contemplating a divorce often hate, loathe, and despise each other. We’ve all heard of stories of divorcing couples deliberately destroying objects of sentimental value to each other. Indeed, many couples in this situation wallow in petty spite; they can’t stop bad-mouthing each other to anyone who will listen.

With these facts firmly in mind, how confident are you that Coase’s zero transactions costs assumption is remotely true? At risk of sounding Austrian, transactions costs are subjective: Bargaining with your mortal enemy hurts.

If this story seems grim, I should add that bitter politics has one major advantage over bitter divorce.  Namely: Partisan bitterness throws much-needed sand into the gears of the state.  Given public opinion, amicable government is likely to be big government.  As long as political antipathy is too shallow to cause civil war, both libertarians and pragmatists should welcome it.  Will Rogers once mused, “Be thankful we’re not getting all the government we’re paying for.”  I’d add, “Be thankful we’re not even getting all the government both parties support.”

P.S. I’m well-aware that deadlock locks existing bad policies in place, too.  But I see little political support for repealing such policies, and broad political support for adding new bad policies.  Tragic, but that’s the world we live in.

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Right and Wrong

Nobody asked but …

Right and wrong are not sides of a coin.  Right is according to principle.  That which is not according to principle is wrong.  Ethicists like to do thought experiments that only muddy the water.

Take, for instance, the trolley problem.  The problem is defined at the Stanford Encyclopedia of Philosophy as follows:

 … a trolley driver must choose between turning a trolley so that it runs over an innocent man attached to a track and allowing the trolley to run over and kill five innocent people.

But we make a mistake by trying to find a principle that will fit either leg of this dilemma.  There is no principle, and certainly not a lame one such as the lesser of two evils, a pseudoprinciple.  There is no right choice.  There are only wrong choices.

Relax.  The trolley problem is unlikely, but one may nevertheless encounter gray-area problems.  These usually involve two or more wrong choices, however, they may hide a good choice.  There are unnumerable actions that may have forestalled the trolley problem.

It is always a right action to follow the NAP — the non–aggression principle — do not initiate aggression.

— Kilgore Forelle

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Tariffs Cause Americans to Accept Inferior Deals

Suppose I decided to go back into the business of being a professor of economics specializing in economic history in the USA. Suppose further that 100 jobs are available, and 101 applicants for these jobs have been ranked by the hiring institutions. Everyone agrees that I am the worst of the lot. Each of the applicants is willing to work at the going rate.

However, before any hires can be made, the government lays a 500% tariff on the services of imported economic historians, and it turns out each of the applicants except me is a foreigner. Given the tremendous increase in the salary that would have to be paid to (superior) foreign sellers of the service, I get a hundred job offers even though I am by general agreement the worst of the bunch.

This is how tariffs work. They make superior offers less desirable for buyers by making them more costly. The result is that buyers end up with goods and services that, absent the tariff, they would not want to buy. Everyone is worse off—except me, of course. I am the sort of shoddy substitute that ends up being chosen despite my manifest inferiority for doing the job.

If directly or indirectly the government uses its power to get you to Buy American, the slogan might as well be, Buy Crap. You don’t need to put a gun to someone’s head to get him to exercise the option that in his judgment is best for him.

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US Schools Are Leaving Students Ill-Equipped to Compete with Artificial Intelligence

We have long known that the robots were coming, but now that they are here, the mismatch between our modern education system and the technology-fueled workplace is glaringly apparent. As robots expertly perform routine tasks and increasingly assume broader workforce responsibilities, we must ask ourselves an important question: What is our key human differentiator?

The Power of Creativity

According to Boston University professor Iain Cockburn, who just published a new paper on the impact of artificial intelligence, the human competitive advantage lies in optimizing “what we can do better than machines, which is imagination, creativity, judgment.” In the paper, Cockburn and his colleagues suggest that it’s possible the robots will catch up to us soon in these realms, but they are not there yet. They write:

Instead, recent advances in both robotics and in deep learning are by and large innovations that require a significant level of human planning and that apply to a relatively narrow domain of problem-solving (e.g., face recognition, playing Go, picking up a particular object, etc.). While it is of course possible that further breakthroughs will lead to a technology that can meaningfully mimic the nature of human subjective intelligence and emotion, the recent advances that have attracted scientific and commercial attention are well removed from these domains.

If human imagination, creativity, and judgment are our primary tools for competing successfully with today’s robots, then it would make sense for current education models to focus on cultivating these qualities. The sad fact, however, is that most schooling is stuck in a 19th-century system of command and control, memorization, and regurgitation that may successfully train young people to be robotic workers but not innovative thinkers.

It’s Time to Adapt

Recognizing the inevitable effects of automation, artificial intelligence researchers have been calling for dramatic changes in the education of our youth since computers first appeared. One futurist was Seymour Papert, a renowned mathematician who became co-director of the MIT Artificial Intelligence Laboratory in the 1960s.

Papert was a critic of education models based on top-down instruction and passive learning. He believed that “the model of successful learning is the way a child learns to talk, a process that takes place without deliberate and organized teaching.” So firm was his vision of the ways technology could facilitate authentic learning, Papert foreshadowed the end of conventional schooling. In his 1980 book, Mindstorms: Children, Computers, and Powerful Ideas, Papert writes that “schools as we know them today will have no place in the future.”

Of course, Papert’s vision hasn’t emerged. Other than the ubiquity of computers, most present schooling looks remarkably similar to schooling in the 1980s, and passive learning and a teach-and-test approach to education endures. American public school students now take more than one hundred required standardized tests from preschool through high school graduation—a number that has skyrocketed in recent years. At the same time, their creativity scores are plummeting. College of William & Mary professor Kyung Hee Kim discovered that American creativity scores have been falling precipitously since the early 1990s, with elementary school-age children experiencing the sharpest drop in creativity.

We should all be alarmed. If human creativity is our key competitive advantage against robots, and that creativity is declining, the forthcoming workplace disruption and job losses that will accompany increased automation will be more severe than they otherwise should be. Some educators suggest doubling down on efforts to foster creativity. John Maeda, the former president of Rhode Island School of Design, said in an interview:

I wouldn’t say [creativity] can be taught in the normal sense of adding knowledge and wisdom to someone. I would say instead it can be re-kindled in people—all children are creative. They just lose their capability to be creative by growing up.

But it’s not a consequence of growing up that causes creativity to decline: It’s our antiquated system of forced schooling that was designed to crush creativity in the name of conformity. As I spotlight in my upcoming book, Unschooled: Raising Curious, Well-Educated Children Outside the Conventional Classroom, young people who learn without school, or in other non-coercive learning environments, retain their natural creativity and curiosity. We don’t need to rekindle creativity; we need to stop destroying it.

To compete with robots, we need an education model that nurtures human imagination and ingenuity. Forced schooling is ill-equipped to do this, but models of learning without conventional schooling are ideally positioned to take on the pending robot challenge.

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