Category: reason

Please enjoy the latest edition of Short Circuit, a weekly feature from the Institute for Justice.

New on the Short Circuit podcast: A whole lot of election law cases.

• Prospective immigrants to the U.S. get a leg up if they plan to invest $500k to build a business in certain targeted areas. If their investment takes the form of indebtedness, however, it only counts if the debt is secured by their personal assets. So what happens if they invest the proceeds of a loan? Is that cash or indebtedness? D.C. Circuit: If you buy a car with money the bank loaned you, you give cash to the car dealer, who doesn’t care where you got it. Same thing here.
• SCOTUS (June 2020): A state cannot exclude schools from a student-aid program because they are religious. First Circuit (October 2020): Well, sure, but a state can exclude schools because they do religious things. (This is an IJ case.)
• Connecticut class clown is asked to write a blog post answering open-ended questions about how characters in a video interacted with each other as part of a communications class. Instead, he writes a post ridiculing the assignment, which the instructor took down. So, like any normal person, the student files a pro se lawsuit alleging a violation of his First Amendment rights. Second Circuit: There’s no First Amendment right to not do your homework. Concurrence: I disagree with all of the legal reasoning the majority employs, but it doesn’t matter because Qualified Immunity.
• Apparently swapping porno mags and putting up naughty screensavers and loudly moaning while describing sexual fantasies about your co-workers at work is a no-no. So says the Second Circuit in this decision reinstating a jury verdict in a Title VII case brought by a retired Ulster County, N.Y. prison employee against her former employer.
• Houston law requires that all who circulate petitions to get measures on the ballot must be Houston voters. Oops, the Supreme Court held that unconstitutional 20 years ago. Is this “zombie” law sufficiently alive to pose a threat to First Amendment rights? Fifth Circuit: Indeed it is. The petition form still lists the requirement, and the city seems to have enforced it in the intervening years. The plaintiffs have standing.
• Customs officials have authority to search vehicles at the border without any probable cause. But what about reaching into a vehicle, grabbing the occupant, and then putting him in cuffs by the side of the road? Do officials need probable cause for that? Fifth Circuit: Nah.
• Allegation: Louisiana corrections employee deliberately keeps inmate imprisoned 60 days past his release date. (Allegedly, the employee announced that “if someone keeps bothering me about their computations they can do more time.”) Fifth Circuit: No qualified immunity for that fellow. But the fellow’s supervisor is off the hook; he might’ve known that his employees were “incompetent” at calculating sentences, but there is no allegation he knew that employees were miscalculating sentences on purpose. (Nor can a separate prisoner, allegedly held 52 days past his release date, sue supervisors at a separate jail.)
• Pro-First Amendment group challenges University of Texas at Austin campus speech code, alleging that its vague terms chill protected speech. University: What? We would never apply this code to speech that was protected by the First Amendment. Fifth Circuit: Query, then, why your speech code doesn’t simply say that students will be disciplined for speech outside the protection of the First Amendment (and, perhaps, Title IX).
• Lawyer: How would you rate my client as a businessman? Witness: Excellent. District Court: OK, now the government can admit tapes of your client making racist jokes about Cleveland Browns fans, since a good businessman would never say those sorts of things. Sixth Circuit: That’s not how this works.
• In a fact pattern that should be familiar by now, public transit system bans “political” advertisements from its busses. Sixth Circuit: We previously upheld Detroit transit’s ad ban on appeal from a preliminary injunction, but the Supreme Court has issued a few opinions in the meantime. Now we see that “political” is way too indeterminate a line on which to regulate speech, and in practice appears to just mean “controversial.”
• By law, Indiana election polls are open from 6am to 6pm on election day. Last year, the state passed laws restricting the ability of officials to extend the hours of the polls. District court: sure might disenfranchise voters, so those laws are enjoined for this election. Seventh Circuit: Not so fast. The possibility that “unforeseen circumstances on election day could disenfranchise voters unless they obtain an extension of polling hours” won’t cut it. The laws don’t burden the right to vote, and the injunction is stayed.
• Minnesota law provides that only those absentee ballots received by election day may be counted. A group sues in state court, and state election officials agree to count all ballots received up to a week after election day. Which likely violates the Electors Clause, says two-thirds of this Eighth Circuit panel. Only the state legislature has the authority to establish how a presidential election may be conducted.
• Kansas City, Mo. police arrest a 15-year-old walking home from his cousin’s house, hold him for three weeks, believing that he had fled police with a gun. One problem: it wasn’t him. Though both were black, the teen they arrested was 5 inches taller and had different clothes and different hair than the suspect. And they found him a mile away seven minutes later, breathing normally and “only a little sweaty” despite the 86-degree heat. District court: The police could’ve reasonably believed they were the same. Eighth Circuit, over a dissent: No, they could not have. No qualified immunity.
• Following the Supreme Court’s 2019 decision overruling the long-dreaded Williamson County doctrine—under which takings claims had to first be litigated in state court—landowner files takings claim in federal court. Ninth Circuit: OK, now we need not consider a property owner’s takings claim because of Pullman abstention. (More on that from a friend of the round-up.)
• Man is arrested for public intoxication and taken to the Muskogee County, Okla. jail. He becomes uncooperative, and while escorting the man to a restraint chair, an officer applies “forward pressure to [his] right arm,” causing the man to fall, suffer an acute subdural hematoma, and die. Excessive force? Tenth Circuit: The officer’s use of modest forward pressure was reasonable.
• In which the Tenth Circuit deep-dives into Urban Dictionary, scrolls through 38 pages of the website’s entry for “dab,” and hits gold on page 39. Among the dictionary’s many definitions of “dab” (after “to touch one’s foot to the ground while bicycling” and “[a] battered potato” but before “when kids want to show off that there [sic] balls haven’t dropped yet“) is this: “a single ‘hit or toke from rolled marijuana.'” So ::insert legal analysis of false arrest claim:: no qualified immunity!
• The Netflix original series Narcos chronicles the rise and fall of notorious drug kingpin Pablo Escobar. But does it also infringe the copyright of Virginia Vallejo—a well-known Colombian journalist who wrote a memoir of her romantic affair with the richest criminal in history—who alleges that the show stole two scenes from her book (one of which made your editor blush)? Eleventh Circuit: The memoir purports to be a true story, and copyright doesn’t protect facts.
• After tentatively settling a class action alleging that Godiva Chocolates violated federal law by including too many credit card numerals on its receipts, the chocolatier catches a lucky break: The en banc Eleventh Circuit (over three lengthy dissents) throws out the case on standing grounds, concluding that this “bare procedural violation” is not sufficient to cause an injury under the Supreme Court’s ruling in Spokeo, Inc. v. Robins, which was decided after settlement but before the class fairness hearing.

In 2019, Nebraska joined the vast majority of states across the country by passing LB 304, which exempted home bakers from the state’s commercial kitchen inspection and licensing requirements. That includes home bakers like IJ client Cindy Harper, who was excited about the prospect of selling her delicious sugar cookies to friends in Lincoln. But earlier this year, Lincoln went rogue and unveiled local ordinances designed to reimpose the very inspection and licensing requirements the state legislature repealed. Undeterred, Cindy fought back, and with IJ’s help filed a lawsuit against Lincoln, arguing that the ordinances were preempted by state law. Just this week, she obtained a favorable state court ruling allowing her lawsuit to move forward. Click here to learn more about Cindy’s case.

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For many reasons, I don’t use the Bluebook. I have not opened a copy since I finished clerking. I try my best to put citations into a format that would allow the reader to locate the source. Beyond that bare minimum, I really don’t care whether a period is italicized. I let my research assistants use their best discretion to revise my footnotes. And, ultimately, the journals will put me through citation hell.

Would anyone defend the Bluebook as a matter of first principles? If we were writing on a blank slate, would anyone come up with every jot and tittle in the 21st Edition of the Bluebook? Like certain precedents, the Bluebook can only be defended based on principles of stare decisis and reliance interests. In Artis v. D.C., Justice Goruch observed, “Chesterton reminds us not to clear away a fence just because we cannot see its point. Even if a fence doesn’t seem to have a reason, sometimes all that means is we need to look more carefully for the reason it was built in the first place.” Sorry, G.K. Tear down this blue-painted fence.

Paradoxically, for most journals, style matters more than substance. Journals will seldom force authors to make substantive changes. Sure, editors will grouse about how the author presents arguments. But ultimately, they will relent if the author pushes back hard enough. (Don’t be afraid of standing firm; editors turn over every year and institutional memories are short).

For “style” changes, however, journals are uncompromising. They will resist even the slightest deviations from the Bluebook and local style guides. Want to add a Table of Contents or an Abstract (the only parts of an article most people will ever read)? Good luck if the style guide prohibits it. Object to so-called Harvard citations, where a single sentence has two footnotes to the same case? Sorry, you’re stuck. Want to upload a PDF for a document on ECF, so that readers do not have to pay a fee? You’ll need to fight the editors, because the bluebook does not sanction such a helpful link. And so on.

At bottom, style guides and citation manuals are systems of control. They provide very little value, and exist to perpetuate rigid rules of how information is conveyed. These regimes are not substantive in nature. Yet, these rule restrict what substance can be published.

This background brings me to Will Baude and Steve Sach’s post. They write:

According to reports we’ve received from multiple sources, a new version of the BlueBook, not yet released, may require legal scholars to flag any cases whose facts involve slavery. The new Rule 10.7.1 (explanatory phrases and weight of authority) would provide that citations to these cases must add a parenthetical disclaimer like “(enslaved party)” or “(enslaved person at issue).”

I have not heard of this proposal, but I trust Will and Steve’s reports. They are very much tuned into legal scholarship, and routinely publish in top law reviews.

I think the upshot of this regime is that scholars will simply stop citing articles with a (slavery) parenthetical. Given today’s culture, why would any professor willingly litter his or her footnote with the mark of original sin? Asking a research assistant to shepardize a (slavery) case could itself be a traumatic act. And this outcome will not be limited to legal scholarship. Progressive law clerks can now insist that judges should stop citing (slavery) cases. (Recently, a Massachusetts court refused to use the word “grandfatherig,” even though the term predated its Jim Crow usage). And junior associates will refuse to embrace (slavery) cases. Partners will have to given in.

With this subtle procedural change, the Crits will quietly accomplish a long term goal. In fairly short order, entire swaths of jurisprudence will be cancelled. And this erasure will be indiscriminate. Benign cases with even the slightest connection to slavery will be lumped together with dreadful cases like Dred Scott.

And do not think this sort of cancellation will be limited to slavery. What about decisions that restricted the rights of indigenous people? Of women? Of immigrants? And so on. Scholars, and ultimately courts, will soon feel constrained over what cases can be cited. The only cases that will be cited are those that pass some sort of progressive litmus test.

To be on the safe side, scholars should not cite any authority before 1865. Yes, that era includes the Constitution. Would every citation to the Constitution have to include a parenthetical: (treating slaves as 3/5 of person, approving return of runaway slave, and sanctioning slave trade). And don’t forget about the Declaration: (affirming that all men are created equal, but the author was a notorious slaveholder).

Will and Steve suggest that law reviews may also add parentheticals to identify specific bad justices.

 If the BlueBook editors want to start describing a future legal system in which morally disfavored law is flagged—perhaps citations to disfavored Amendments or disfavored Justices’ opinions (“(opinion of Taney, C.J., racist)”)—nothing can stop them.

I already started a list of Justices worthy of cancellation. I’m sure the Bluebook can add a table with handy summaries of all Supreme Court justices:

• (Marshall, C.J., slaveholder, ruled against indigenous people).
• (Harlan, J., favorable rulings towards African Americans, displayed animus towards Asian Americans).
• (Holmes, J., supported eugenics).
• (Brandeis, J., filed misogynistic brief)
• (Black, J., former Klansman, upheld Japanese internment).
• (Kennedy, J. favorable LGTB rulings but voted to uphold racist travel ban).
• (Kavanaugh, J. credibly-accused of sexual assault).
• (Barrett, J.) (anti-choice, dogma lives loudly).
• (Scalia, J., too many flaws to count).
• (Ginsburg J.) (hired only one African-American law clerk).

Woops. That last one may not make the cut.

What other changes are on the horizon? Soon enough, I suspect journals will force authors to put preferred pronouns in the author note. Additionally, if an article touches on race, the author may be required to disclose his or her race. In 2013, I blogged about the California Law Review’s decision to require authors submit their racial classifications. This mandate will spread. For example, I’ve noticed that the New York Times flags whether a person is a Black man or a Black woman (capital B). Journals will no doubt follow this lead. (Despite his surname, Josh Blackman is in fact a white man).

***

I suspect conservative students on the law reviews flagged this issue to Baude and Sachs out of desperation. The few right-of-center editors who make it through the progressive gauntlet no doubt lack the institutional support to stop these changes. The antiracism agenda is in full swing, and nothing can stop it. Dissent cannot be tolerated. And, I fear, most law professors will simply roll over and accept these new forms of control.

Scholars who try to resist these rules will fail. Editors will usually bend on substance, but are rigid on style. Conservative scholars will be forced to litter citations with virtue signaling parentheticals. Or, they can choose to stop publishing in law journals. Plus, law review editors who screen articles can easily ding a submission because it does not have the correct form of social-justice citations. This change will force authors to conform to a specific ideology, or exit the market altogether. I have that latter luxury as a tenured professor, but junior scholars will be put to a more difficult choice.

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• Exhumed: A History of Zombies. PBS. Friday, October 30, 10 p.m.
• B Positive. CBS. Thursday November 5, 8:30 p.m.

You’ve got an important television choice this week: Yet another medical pestilence to worry about along with the virus; or the scariest Halloween show ever. It’s kind of a trick question, because I didn’t say “best” Halloween show, just scariest: PBS unleashes a slavering pack of fanged academics on zombies, and the bloody brain cells and decapitated IQ points are scattered in all directions. Save yourself and stick to CBS’ kidney-transplant sitcom.

Exhumed: A History of Zombies is a special broadcast episode of the streaming PBS series Monstrum, a weekly dissection of the history of monsters, myths, and legends hosted by Arizona State English professor Emily Zarka. Like any respectable academic trying to explain her interest in something like zombies, she says she’s asking, “What does their complex history teach us about ourselves?” The answer, as you’ve probably surmised, is nothing as simple as “We don’t like to be disemboweled and have our brains eaten.”

Zombie stories originated in Haiti, perhaps as early as the 17th century, where voodoo priests known as bokurs were said to steal the souls of their enemies and reduce them to shuffling, blank-eyed slaves. Exhumed argues that the zombie stories are “an allegory for colonialism, imperialism, and oppression.” But the tales were considered anything but folkloric allegories by Haitians, who in 1835 (long after white rule ended) outlawed the practice. And in any event, the original zombie stories sort of screw the metaphorical pooch; the supposed creators of zombies were not white planters but black voodoo priests.

Zombies remained largely unknown in America, or at least the white part of it, until U.S. Marines began returning from stints in Woodrow Wilson’s 1915 military intervention in Haiti with lurid accounts of battles with them. By 1932, zombie fever had reached Hollywood, which for the next decade turned out a steady stream of films like I Walked with a Zombie in which sultry white maidens were besieged by giant shambling islanders.

Zarka and her colleagues are undoubtedly correct that there was at least an element of racism in many of those films. (Though when the zombies are white, as occasionally happened, the professors immediately launch cries of “cultural appropriation.” And if you’re about to ask if Zarka wonders if a show about black zombies produced by a pixieish blonde white professor might also be cultural appropriation, well, no.)

But it’s hard to imagine how racism or slavery could be seen in the big bang of zombie creationism, the 1968 George Romero film Night of the Living Dead. It features flesh-eating creatures (Romero called them “ghouls,” not zombies; it was fans who started using the z-word) who are turned not by voodoo priests but by radiation leaking from an exploded satellite, which reanimates recent corpses.

The only black character in the entire film is not a zombie but the hero, a truck driver who takes charge of the survivors—but he’s killed in the film’s coda by rescuers who mistake him for a zombie. “Lynch mob!” Zarka and her colleagues triumphantly declare. Actually, the black/white dichotomy in the casting was entirely coincidental; Night of the Living Dead was made for about $100,000 in a rural town outside Pittsburgh, and nearly everyone in it was a friend or neighbor of Romero’s. The director wanted a professional actor, no matter how thin his resume, for the lead, and Duane Jones, who taught drama at SUNY-Old Westbury and happened to be home on Christmas break, got the part.

Nonetheless, the lynch-mob theory is downright plausible compared to Exhumed‘s final doctrinal proclamation, that Night of the Living Dead‘s conclusion is somehow linked to the assassination of Martin Luther King Jr., who was killed by a white gunman in April 1968. The problem with that is photography on Night of the Living Dead was completed in December 1967, five months earlier. If renegade zombies were to eat the brains of Zarka and her coterie of PC-obsessed companions, they’d be hungry an hour later.

So, things that go bump in the night be damned, stick with B Positive, the only fall pilot CBS was able to complete before last spring’s virus lockdown. Created by Marco Pennette of the production shop of Chuck Lorre (The Big Bang Theory, Mom), B Positive is supposedly inspired by Pennette’s own experience with treacherous kidneys.

Thomas Middleditch (Silicon Valley) plays Drew, a tightly strung guy with an internet certificate in psychotherapy, a snippy ex-wife, and a teenage daughter who blames him for the breakup of the marriage. That’s the happy side of his life. Now his doctor has warned him that both his kidneys are failing, and he’d better come up with a donor, fast. Not an easy task for a guy with an estranged family and few friends.

His last hope is a high-school acquaintance named Gina (Tony-winning Broadway actress Annaleigh Ashford) who he bumps into at a wedding—a bridesmaid, she’s whispering gossip about anal sex during the ceremony—who hears his story and (very) drunkenly offers to help out. (With a kidney, not anal sex, though I’ve only seen one episode.) “My organ will be in you!” she proudly announces, to the bemusement of the wedding guests.

The good news is, she turns out to be a match; the bad news, that keeping an exuberantly intoxicated and promiscuous airhead (Gina herself tells a friend that Drew is “the one guy I didn’t hook up with in high school”) is not easy, notwithstanding Gina’s promises. Stopping the drinking and dope, she vows, is “not a problem—I’ve quit hundreds of times.”

Like most Chuck Lorre-branded shows, B Positive starts out as a barrage of one-liners, most of them admittedly funny, but not necessarily suggesting a solid structure for a continuing show. Yet somehow during all the raucous punchlines, some engaging characters start to show up—Drew, emerging in fits and starts from an endemic mistrust of the world that has only been deepened by the collapse of his marriage; Gina, recognizing the trivial trashiness of her life and desperately looking for an exit. They turn out to be likeable, and will neither try to eat your brains nor explain why structural racism made them do it.

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The mythical menace of THC-infused Halloween candy continues to haunt police departments and news outlets across the country, as Reason‘s Lenore Skenazy notes. But a review of recent press coverage suggests that journalists are starting to wise up.

In 2014, after Denver police told parents to be on the lookout for marijuana edibles in their kids’ trick-or-treat bags, I searched for evidence that anything like that had ever happened and found none. Since 1996, the year that California became the first state to legalize marijuana for medical use, drug warriors and their credulous collaborators at newspapers and TV stations have repeatedly warned parents that seemingly friendly strangers might be trying to get their kids high on Halloween by passing off THC-infused candy as ordinary treats. Yet none of those stories cited any actual examples.

Even the 2019 case mentioned in the scare story that Yahoo! News ran this week does not really count as a fulfillment of those dark prophecies. Last November, The Day, a Connecticut newspaper, reported that Waterford police “found two kids under the age of 18 had each received two sealed packages of…’Shake & Baked Kitchen’ gummies.” This incident did not look like an attempted prank, since “the packages stated that each bag contained 10 gummies with a corresponding THC level of 10 mg per gummy.” The Day noted that “no one ingested the candies and no injuries have been reported.” The paper added that “it was not clear if the candy was intentionally handed out or was an unintentional oversight by the owner.”

Another 2019 Halloween scare likewise was not what it seemed. “North Carolina drug investigators allegedly seized 200 pieces of marijuana-infused Halloween candy from a South Carolina man,” the CBS station in Greenville reported. It described the seizure as “200 Nerds Rope candies allegedly infused with THC,” presumably a doctored version of this product. The station added that “detectives think the candy was going to be distributed at college parties and said there’s ‘no reason to believe it was intended to be distributed to young children trick or treating.'”

This year there has been no shortage of stories alerting parents to a danger that has never been documented and never made much sense, since substituting expensive marijuana edibles for cheap candy from Walmart or Target offers no obvious payoff even for maliciously minded stoners: If anyone managed to trick kids into eating medicated munchies, he would not be around to witness the effects. After two decades of this nonsense, however, the implausibility of the warnings and the lack of evidence to support them are starting to penetrate. On Monday, the Indiana State Police posted a Facebook warning that was covered by several news outlets, at least one of which showed appropriate skepticism.

“Parents, here is an example of what to look for in your child’s Halloween candy this year,” the Facebook message said. “These were seized just this past weekend by one of our Troopers from the Lowell post. While they are packaged and marketed to look like candy, they are not. You have to look closely to see the ‘Medicated’ wording. Please thoroughly check all candy and don’t assume it’s ‘OK’ just because it looks ‘OK.'”

The pictures accompanying the post showed bags of “Medicated Starburst Gummies” and “Medicated Sour Skittles” from California. These are knockoffs of the familiar brands, and Mars Wrigley, which makes both products, is not happy about that. But despite the superficial resemblance, both packages are clearly labeled as marijuana products: In addition to the word medicated, the bags are speckled with cannabis leaves and have state-mandated labels indicating the nature of the product and the THC content. In any case, as usual, there was no indication that anyone planned to pass out the candy to children.

While outlets such as Fox News echoed the scaremongering, the ABC station in Chicago offered this caveat in the second paragraph of its story: “In the past, people have been worried about poisoned or contaminated Halloween candies. Those fears were unfounded. There has actually never been a single confirmed case of a trick-or-treater being poisoned by candy.” The last paragraph added this: “There have been no confirmed cases of kids getting marijuana edibles in their Halloween candy. But Indiana police wanted to make sure you check your kids’ candy anyway.” The NBC station in Indianapolis was less wary, although it noted that “there’s no evidence the person booked for possessing the medicated candies had any intention of giving them to children.”

In addition to such notes of caution, straightforward debunkings are becoming more common, not just in alternative papers like the East Bay Express but also in more mainstream publications. “No One’s Going to Give Your Kids Free Weed in Their Halloween Candy,” said the headline over an October 2019 Slate piece by Jane C. Hu, who noted, “There are no actual reports of this ever happening.” A week later, the Washington Examiner ran an opinion piece by freelance writer Tom Joyce with the same message: “No one is giving your children marijuana candy this Halloween.” Around the same time, NBC News ran an essay by Simon Moya-Smith with this headline: “The Halloween tale of marijuana handed out to trick-or-treaters is as real as a ghost story.” This month the Spokane Spokesman-Review noted that “tainted treats turn out to be mostly make-believe.”

It looks like people are beginning to understand that the risk of THC in their kids’ trick-or-treat haul is about as plausible as the risk of razor blades in apples or needles in chocolate bars. But given the apparently inexhaustible demand for Halloween horror stories, it seems likely that some other menace will take its place.

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In 2018, President Donald Trump teamed up with then–Wisconsin Governor Scott Walker (R) to offer $4.5 billion in subsidies and tax incentives to the Taiwanese manufacturer Foxconn in exchange for building a 20-million-square-foot factory in the rural community of Mount Pleasant.

“I think we can say this is the eighth wonder of the world,” Trump said at a groundbreaking ceremony in June 2018.

The project was supposed to employ 13,000 local workers, helping to make good on Trump’s campaign promise to increase the number of domestic factory jobs.

More than two years later, planners have flattened a residential neighborhood and built an unfinished data center and warehouses, which are a fraction of the size of the state-of-the-art LCD panel factory that was originally planned.

After Foxconn failed to reach employment benchmarks, Governor Tony Evers, a Democrat, who defeated Walker in 2018, clawed back some of the subsidies that his predecessor had promised. The major facility constructed by the company is one-twentieth the size of what was originally promised, and its planned use has changed from manufacturing to storage, according to an article in The Verge.

The Foxconn debacle is just the latest government-led development deal riddled with false promises in which the state provided the rich with giveaways and used the threat of eminent domain to push ordinary citizens out of their homes to benefit a private company. The Mount Pleasant neighborhood where the Foxconn factory was supposed to be built was flattened—questionably so, since the buildings that have been constructed occupy a tiny portion of the area that was demolished. 

When Reason did a story on the project in 2018, Kim and Jim Mahoney were some of the only residents left within 1 1/2 square miles. They were fighting the local government, which was attempting to bully them into selling their dream home by threatening that the state would step in and force them out.

“How can they take my house? To me, it’s stealing,” Jim Mahoney told Reason in 2018.

The Mahoneys, unlike all their neighbors, managed to stay put, and today their house overlooks a warehouse and unfinished construction site. It’s unclear what ultimately will become of the project.

“You’re setting people up for failure if you encourage them to locate in a place where they fundamentally shouldn’t be locating,” says economist Matthew D. Mitchell, a senior research fellow and director of the Equity Initiative at the Mercatus Center at George Mason University. Mitchell, who co-authored a study on the Foxconn deal, says it’s a cautionary tale of what happens when politicians become private sector deal-makers.

“You’re not spending your own money and you don’t reap any upside reward from the benefits. So you have no incentive to minimize the costs and no incentive to maximize the benefits,” Mitchell notes.

“If a private entrepreneur went to you and said, ‘I’ve got this great plan. I would like you to invest $3.6 billion into my company. And here’s the best part, it would employ 13,000 people. Isn’t that awesome?’ You would say, ‘Why are you talking to me about the costs?'”

What the public doesn’t see at a ribbon-cutting ceremony is all the economic activity that will never take place because of the burden that taxpayer subsidies shift onto other businesses and activities. Mitchell estimated that the Foxconn deal contained $2.8 billion in outright subsidies. The taxation needed to fund those subsidies would have reduced Wisconsin’s gross domestic product by about $20 billion over that same period.

Using government funds to broker business deals remains popular among politicians. One survey of American mayors found that 84 percent favored using the government for targeted economic development.

“The very best thing that a governor could do is to announce that they will never, ever preside over any ribbon-cutting ceremony in which they subsidize a particular firm,” says Mitchell. Even though the economics don’t make sense, the political incentives encourage mayors and governors to “outbid” neighboring states to attract investment.

“There is a way to get around this that sort of appreciates the political economy of the situation,” Mitchell notes. “States could enter into interstate compacts with one another, whereby they agree to a mutually disarm in the subsidy war—’I’ll put away my subsidies if you put away yours.’ This is really the same kind of logic that governs things like the WTO, and it’s been extraordinarily successful.”

He emphasizes that the Foxconn debacle isn’t a story about Trump’s unique incompetence, as some critics portray it. It’s about the perils of government-led business deals, no matter who’s in charge and what political party they belong to.

Democrats in the Connecticut town of New London partnered with a Republican governor to seize the land of homeowners like Susette Kelo in order to then hand it over to the pharmaceutical giant Pfizer. The project was never built, leaving an empty lot where Kelo’s house once stood 13 years later.

In 1981, Detroit and Hamtramck, Michigan politicians partnered with General Motors to use eminent domain to displace more than 4,000 people in the predominantly immigrant neighborhood of Poletown to make way for a car assembly plant.

In 2009, the Obama administration directed a $535 million government loan to the solar manufacturer Solyndra to construct a manufacturing facility in California, but the company went bankrupt soon after, costing U.S. taxpayers more than half a billion dollars.

“Democrats were very enthusiastic about the subsidies to Solyndra during the Obama years, and they were very down on the subsidies to Carrier and Foxconn during the Trump years,” says Mitchell. “Unfortunately, I think that partisans see target economic development incentives pretty clearly when the other side is doing it, but they have an extraordinary blank spot when it comes to their own incentives.”

Produced by Zach Weissmueller; graphics by Isaac Reese 

Photos: Mark Hertzberg/ZUMA Press/Newscom; Brian Snyder/REUTERS/Newscom; Mark Hoffman—Pool via CNP/picture alliance / Consolidated News Photos/Newscom; Yichuan Cao/ZUMA Press/Newscom; Brian Cassella/TNS/Newscom; Brian Cassella/TNS/Newscom; SMG/ZUMA Press/Newscom; DARREN HAUCK/REUTERS/Newscom; Kevin Lamarque/REUTERS/Newscom; Pete Souza/PSG/Newscom; Chris Bergin/REUTERS/Newscom; Brian Cassella/TNS/Newscom

Music: “Wonder” and Moment in Time” by Tristan Barton.

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