Category: reason

An inspector general’s report has found the U.S. Air Force spent $549 million on Italian-made cargo planes for the Afghan government. Afghan pilots made numerous complaints about the safety of the planes, and they had frequent maintenance issues, with delays in obtaining spare parts. The planes were sold for scrap metal for $40,257 just six years after the program began. An Air Force general heavily involved in the program later retired from active duty and was hired by the company that sold the planes as its main contact with the Air Force on the program.

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A lot has been said about the harm to people resulting from government lockdowns imposed in the name of fighting COVID-19. However, lockdowns aren’t the only misguided policies that we’ve had and continue to endure because of this pandemic. In fact, we will suffer many tragic effects from the pandemic-induced changes long after lockdowns are lifted and the coronavirus is endemic.

The case against lockdowns is pretty well established. In fact, contrary to accusations issued by lockdown advocates, one doesn’t have to believe that COVID-19 isn’t a serious disease to oppose lockdowns. Nor does one have to make the claim that doing nothing would have worked wonders in controlling this nasty virus. All you have to show is that lockdowns do not control the spread of the virus any better than less-draconian alternatives. In fact, when all costs are considered, such as the short- and long-term health, educational and psychological harms the lockdowns caused, their costs far exceed their benefits.

It’s also hard to avoid the label of tyrannical policy today when still talking about lockdowns a year into this pandemic. Many academic studies about their lack of effectiveness and enormous evidence of their harms are available, yet lockdowns aren’t fully lifted, and many schools still aren’t opened. It’s particularly frustrating since it has become obvious that those protesting the lifting of these policies—aside from the politicians who directly or indirectly benefit from them—are the wealthier and politically connected people who are less affected by lockdowns than most.

However, there are other terrible consequences of the pandemic response that we’ll have to live with long after the lockdowns are lifted. The main one is the utterly insane expansion of federal spending. It’s traditional for the federal government to expand during emergencies. Yet the size of the response this time around is both unprecedented and unwarranted. Uncle Sam’s $6 trillion (so far) in COVID-19 relief spending can’t be justified based on the GDP loss, on wage and salary losses, or on any other measures.

A second round of individual checks, independent of how COVID-19 has affected their income, or unemployment benefits that pay workers more for being unemployed than from working, could worsen people’s expectations of what Uncle Sam should do for us or what benefits we’re entitled to.

Furthermore, this spending is turning into more debt. Federal indebtedness now stands at 136 percent of GDP. And that’s before President Joe Biden’s COVID-19 relief package. It’s hard to overstate how insane it is that these levels are rising without an end in sight. Debt reached unprecedented heights during World War II, but it was always projected to fall when the war ended.

It’s now fashionable to claim that debt doesn’t matter. After all, we’ve been warning about the unsustainability of our debt for years. True. It’s also true that a full-on debt crisis may not happen for years. But that doesn’t mean that it won’t ever happen. Just looking at the numbers reveals the inevitability of such a crisis. Who will finance our debt when it reaches 300 percent of GDP? Who will finance the debt Uncle Sam will need to pay for the $101 trillion in unfunded liabilities accumulated by Social Security and Medicare?

Debt crises take a long time to develop until they’re suddenly upon us. But before that happens, we will still have to live with the other nasty side effects of our overbearing debt such as new taxes, big cuts to entitlement programs and slower economic growth. All of these effects will, once again, affect poorer people the most.

Finally, perhaps the greatest cost of the policy reactions to COVID-19 is that it will have left Americans believing that governments can and must do anything to achieve a zero-risk society. That mindset means spending trillions of dollars on any bills that pretend to protect us from adversity. But it also entails a worrisome tolerance for intrusive policies, such as vaccine passports, daily symptom surveys in schools, a permanent mask mandate in planes, and many other forms of hygiene socialism, regardless of the merits of these policies.

Yet, as economist Steve Horowitz recently wrote to me on Facebook, “The reality is that we can never achieve” a zero-risk society, and “the costs of trying to are enormous, in terms of both material resources and human freedom.”

COPYRIGHT 2021 CREATORS.COM

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Congress on Wednesday passed a $1.9 trillion COVID-19 aid bill, complete with relief checks, school funding, state bailouts, and emergency business loans, among other provisions. While some aspects of the American Rescue Plan are related to the coronavirus, much of the bill is not.

There’s a healthy debate to be had about what the government owes the American people: With mandated closures upending livelihoods, it’s fair to argue that, in some sense, the state owes the public some redress. Emergency loans for businesses—restaurants, bars, airlines music venues, and others—will go to those who demonstrate some sort of economic hit. Single adults making less than $75,000 a year and couples who file jointly and make less than $150,000 will qualify for $1,400, though there are likely few individuals or families below those income cutoffs who genuinely need $1,400.

No such means test will be applied to money headed for state government coffers, yet it perhaps should be. Many states aren’t doing poorly at all, with California, for instance, reporting a $15 billion surplus. American taxpayers are about to send them several billion dollars more.

The same can be said for school funding. As Reason‘s Peter Suderman notes, Biden campaigned on speedily reopening schools and quickly backtracked, citing a need for more education funding to ensure proper COVID-19 protocols. The problem is that there remains unspent $100 billion allocated for schools by previous coronavirus bills. The additional billions allotted to schools by the American Rescue Plan also won’t be used anytime soon, though it’s supposedly necessary to reopen schools in the near future.

“Just $6 billion would be spent in the 2021 fiscal year, which runs through September,” writes Suderman. “Another $32 billion would be spent in 2022, and the rest by 2028. Biden is insisting that schools must reopen soon—and also that the only way for them to reopen is to authorize more than $120 billion in spending, most of which wouldn’t roll out for years. It doesn’t make much sense.”

In that vein, the bill is peppered with standard Democratic policies disguised as COVID-19 relief. For example, Congress just approved 15 weeks paid leave for every federal employee who has a child in virtual learning, even if their children are enrolled in districts where schools have reopened and remote learning is merely an option provided to cautious parents. It’s evocative of the Democrats’ first coronavirus aid bill a full year ago, which attempted to carve out a permanent paid leave program for victims of stalking and domestic violence.

The $15 minimum wage proposal, another policy with no connection to COVID-19, was nuked by the Senate parliamentarian and centrist Democrats. That, too, was packaged as coronavirus aid for struggling workers, notwithstanding the fact that it wouldn’t have gone into full effect until 2025.

Funds for a bridge connecting New York to Canada, as well as for a new metro in San Jose, California, were also scrapped from the legislation.

But other unrelated provisions survived to make it into the final bill. As Reason‘s Eric Boehm reports, the Congressional Budget Office “estimates that a total of $480 million in the bill will be spent on ‘miscellaneous’ educational matters like ‘grants to fund activities related to the arts, humanities, libraries, and museums, and Native American language preservation and maintenance.'” It will also fund a temporary increase to the child tax credit.

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A jury acquitted Des Moines Register reporter Andrea Sahouri today of two misdemeanor charges stemming from her coverage of protests last year in a case closely watched by press freedom advocates.

Sahouri was pepper-sprayed and arrested by Des Moines police while covering protests over the police killing of George Floyd last May. Prosecutors and police claimed that Sahouri and her boyfriend ignored orders to disperse and interfered with an arrest, two misdemeanor offenses.

According to the U.S. Press Freedom Tracker, 128 journalists were arrested or detained in the U.S. last year during the months of unrest that followed Floyd’s killing, but Sahouri was one of the only journalists whose charges weren’t dropped by prosecutors. The case drew national attention and outrage from press freedom groups, which called the Polk County District Attorney’s decision to prosecute Sahouri outrageous, excessive, and wasteful.

“The acquittal of journalist Andrea Sahouri in Iowa today is a welcome relief, but Polk County prosecutors never should have filed charges against her in the first place,” Committee to Protect Journalists program director Carlos Martinez de la Serna said in a press release. “Reporting is not a crime, and journalists should not be punished for doing their jobs and covering matters of public interest.”

The arresting officer, Luke Wilson, testified that he was clearing a street of an unruly mob and wasn’t aware that Sahouri was a reporter. Sahouri was not wearing a press badge. However, Sahouri and other journalists who were on the scene sharply disputed the police account of her arrest.

“I see an officer coming at me, so immediately I put up my hands and I say ‘I’m press’ because he was coming like, right at me, and I didn’t think it was a good idea to run from officers,” Sahouri testified during her trial. “He grabbed me, he pepper-sprayed me and as he was doing so said, ‘That’s not what I asked.'”

"I put up my hands. I said, 'I'm press. I'm press. I'm press.' He grabbed me, pepper-sprayed me."

Register reporter Andrea Sahouri describes the moment she was arrested covering a racial justice protest this summer. See more from her trial at https://t.co/fgn8vFmfw9 pic.twitter.com/O1FrwvHnxj

— Des Moines Register (@DMRegister) March 10, 2021

Body camera footage could have cleared this up, but, after a judge ordered prosecutors to produce the video, it was revealed that Wilson did not save the footage of Sahouri’s arrest and did not report it to his supervising officer, as department rules required.

Last year, a federal judge in Portland ordered police to stop targeting reporters with less-than-lethal munitions and exempted journalists and legal observers from orders to disperse.

New York Attorney General Letitia James filed a lawsuit in January against New York City for what she says was unchecked excessive force and false arrests by NYPD against protesters, medics, and legal observers.

After her trial concluded today, Sahouri tweeted one word: “Acquitted.”

Acquitted.

(Photo credit: Ted Nieters/Polaris Images) pic.twitter.com/sUkjJHQ4gg

— Andrea May Sahouri (@andreamsahouri) March 10, 2021

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Buried within the $1.9 trillion emergency spending bill that Congress sent to President Joe Biden’s desk on Wednesday is a provision that could effectively block states from cutting taxes if they accept federal bailout dollars.

That provision, added to the bill by the Senate last week, could put a halt to several states’ plans to cut taxes this year as a way to stimulate economic growth following the COVID-19 pandemic. Depending on how the text is interpreted, the measure could also make it illegal for states to create new tax credit programs like the ones that have become a popular mechanism for expanding school choice. Critics say this expansion of federal control over state policymaking is murky at best, and potentially unconstitutional.

First, the basics: The COVID-19 relief-bill-that-isn’t-really-a-relief-bill contains $350 billion earmarked for state governments, local governments, and Native American tribes. That money is supposed to help governments fill temporary budget holes created by the pandemic—even though the funding vastly exceeds actual state and local budget shortfalls, as Reason’s Christian Britschi has previously reported. States are in such non-dire straits, in fact, that about $150 billion of the state aid distributed as part of last year’s Coronavirus Aid, Relief, and Economic Security (CARES) Act hasn’t even been spent yet.

Since the federal government is giving states money that they don’t need, there are two things state lawmakers can do: Use the federal money to grow government spending or pass that extra cash along to taxpayers by lowering their tax burdens.

However, the Senate inserted language in the American Rescue Plan expressly telling states that they “shall not use the funds provided…to either directly or indirectly offset a reduction in the net tax revenue,” or do anything that “reduces any tax (by providing for a reduction in a rate, a rebate, a deduction, a credit, or otherwise) or delays the imposition of any tax or tax increase.”

That same section of the bill also bans states from depositing the federal bailout into their public pension funds. That’s probably a good idea, but it’s pretty ironic considering that the American Rescue Plan also contains a completely indefensible bailout of some private-sector pension funds run by labor unions.

The bill doesn’t categorically prohibit any changes to state tax policies, but “adjudicating what counts as indirect use to facilitate a tax cut is messy,” Jared Walczak, vice president of state projects at The Tax Foundation, a nonpartisan tax policy think tank, tells Reason. “States will receive federal aid regardless of their budget situation, and many potential uses of that funding could theoretically offset the need to spend state dollars. If that is enough to block a tax cut, states could find themselves barred from cutting taxes even though they could have done so without taking a dollar in state aid.”

And because the language also forbids states from using the federal bailout to forgo a potential tax increase, it may prohibit using the aid to repair state-level unemployment insurance trusts funds that have been dented by pandemic-related unemployment. Instead, states like Maryland might have to go through with a 600 percent hike in unemployment taxes despite getting a windfall from the federal government.

But the biggest losers are states like Mississippi, New Hampshire, and West Virginia that were planning tax cuts next year and now might have to worry about the feds dragging them into court if they do. “This is terrible, this is absolutely terrible,” West Virginia Gov. Jim Justice, a Republican, said Tuesday.

Do states have a choice? They could simply return the bailout dollars to the federal government unspent, of course, and then no restrictions on their use would apply.

Or there might be a legal remedy. The Wall Street Journal editorial board suggests that the provision could violate the Supreme Court’s “anti-commandeering” doctrine that prohibits the federal government from dictating policies to states—that was a bit of an issue in the pandemic’s early days too, you might recall, but for very different reasons.

Even if this bill passes constitutional muster, however, it’s clearly a coercive provision that ties the hands of state policymakers. If Congress doesn’t want states to use bailout dollars for certain purposes, it could more easily accomplish that goal by simply not bailing out states that don’t need the help.

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The American Rescue Plan Act is hurtling toward final passage, but only a few percentage points of its massive $1.9 trillion price tag is specifically geared toward, you know, addressing the pandemic. How little? House Minority Leader Kevin McCarthy (R–Calif.) says just 9 percent of it goes “directly to toward Covid-19 relief.” The nonpartisan Committee for a Responsible Budget puts the number even lower, declaring, “Only about 1 percent of the entire package goes toward COVID-19 vaccines, and 5 percent is truly focused on public health needs surrounding the pandemic.”

Most of it is instead a pre-existing Democratic Party wishlist of increased spending on virtually every aspect of government, including bigger unemployment benefits, even more money for schools, a gigantic child tax credit, and subsidies for Obamacare insurance policies that would phase out only at a household income of more than $580,000. This legislation comes on the heels of the $4 trillion in coronavirus-related spending passed last year.

Peter Suderman, features editor at Reason, joins Nick Gillespie to discuss his cover story in the new issue of the magazine, which is titled “Josh Hawley’s Toxic Populism,” a deep dive into the anti-libertarian platform of the Missouri senator who is one of the Republican Party’s rising stars. They also walk through the nearly $2 trillion of new spending—passed along strict party lines—that is about to be signed into law by President Joe Biden.

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From Karton v. Ari Design & Construction, Inc., decided yesterday by my former colleague Justice John Shephard Wiley, joined by Justices Tricia Bigelow and Elizabeth Grimes:

Trial judges deciding motions for attorney fees properly may consider whether the attorney seeking the fee has become personally embroiled and has, therefore, over-litigated the case. Similarly, judges permissibly may consider whether an attorney’s incivility in litigation has affected the litigation costs.

Here, the trial judge found attorney David Karton’s fee motion triggered these concerns. Karton had a dispute with his home remodeling contractor: defendant and appellee Ari Design and Construction, Inc. At one point, their difference amounted to only $22,096: Karton said Ari owed him $35,096, while Ari contended it owed $13,000.

Karton sued Ari and won a judgment for $133,792.11 plus postjudgment interest [largely under a state statute] {which entitles those using an unlicensed contractor to all compensation they paid the unlicensed contractor, even if they knew the contractor was unlicensed}. Karton then sought attorney fees of $271,530, which were later increased to $287,640 in the trial court and now to $292,140 in this court. The trial court awarded $90,000 in attorney fees. We affirm this award against Karton’s argument that $90,000 is not enough….

[T]he Kartons said their attorney devoted more than 600 hours to this litigation. The court did not doubt it, but thought the hours were “excessive by a lot.”

The court gave five good reasons for concluding 600 plus hours was unreasonable.

First, the trial court rightly found the questions in this case were relatively simple…. Here the issues were pedestrian: whether a contractor had insurance and a license. On the issue of how much Ari owed the Kartons, Cheryl Karton testified Ari owed $35,096, and “[t]his testimony was not controverted by the Defendants.” …

Second, the court had an ample basis to conclude the Kartons over-litigated this matter. They had about a $23,000 dispute with their contractor: the Kartons had said Ari owed $35,096 and Ari had claimed the debt was only $13,000. A $23,000 argument must be resolved, but it does not justify launching a disproportionate litigation offensive. The Kartons’ strategy netted them windfall gains: the harshness of contractor licensing laws allowed them to recoup all their construction monies, plus $10,000, and to retain the benefit of months of free construction work….

Third, the trial court fairly attributed some of the over-litigation to Karton’s personal embroilment in the matter. Karton is an experienced lawyer. He brought this suit about his own home. Karton declared, “I was substantially involved in this case because I was cheated. So, yes, I was involved.” The trial court observed Karton’s demeanor at the hearings and saw he was “agitated about this case. This is your personal matter, and I understand that. I see that you have strong feelings about this case and strong feelings about the course of this litigation and how it has proceeded.” The court had reason to conclude embroilment undermined objectivity about the appropriate scale of litigation.

Fourth, the trial court rightly sought an appropriate relationship between the result achieved and the size of the fee. For a century or more, California courts have considered the success or failure of attorney efforts when evaluating attorney fee requests.

The size of a judgment is pertinent to rational evaluation of a requested fee. Rational decisionmaking weighs benefits and costs…. [R]ational investors or buyers would not spend [$2] to get something worth $1. The trial court properly connected the fee to the judgment.

Fifth, the court correctly noted the incivility in Karton’s briefing. Attorney skill is a traditional touchstone for deciding whether to adjust a lodestar. Civility is an aspect of skill.

Excellent lawyers deserve higher fees, and excellent lawyers are civil. Sound logic and bitter experience support these points.

Civility is an ethical component of professionalism. Civility is desirable in litigation, not only because it is ethically required for its own sake, but also because it is socially advantageous: it lowers the costs of dispute resolution. The American legal profession exists to help people resolve disputes cheaply, swiftly, fairly, and justly. Incivility between counsel is sand in the gears.

Incivility can rankle relations and thereby increase the friction, extent, and cost of litigation. Calling opposing counsel a liar, for instance, can invite destructive reciprocity and generate needless controversies. Seasoning a disagreement with avoidable irritants can turn a minor conflict into a costly and protracted war. All those human hours, which could have been put to socially productive uses, instead are devoted to the unnecessary war and are lost forever. All sides lose, as does the justice system, which must supervise the hostilities.

By contrast, civility in litigation tends to be efficient by allowing disputants to focus on core disagreements and to minimize tangential distractions. It is a salutary incentive for counsel in fee-shifting cases to know their own low blows may return to hit them in the pocketbook….

The Kartons respond to criticism of their personal attacks by attacking.

First the Kartons maintain opposing counsel indeed did knowingly make false statements. They point to a report by a discovery referee. The cited pages, however, recount the parties stipulated certain evidence would be inadmissible. They do not find someone knowingly made false statements. In oral argument on appeal, however, Karton continued to assert opposing counsel was a liar.

Next the Kartons defend calling opposing counsel’s comments “frivolous.” They claim a meet and confer letter was so meritless as to justify this language. The Kartons do not, however, cite a finding faulting this supposedly meritless letter.

On this point, the Kartons quote the Phil Spector murder case at some length, to no avail. There, in closing argument a prosecutor told a jury that expert witnesses will say anything if you pay them enough. This case is irrelevant. Spector involved neither an attack on opposing counsel’s integrity nor appropriate factors in setting an attorney fee award. Instead, it involved a closing argument about an expert witness jurors had to evaluate.

Finally, the trial court noted the Kartons denigrated the actions of opposing counsel as “typical of the improper tactics employed by defendants and their counsel.” The Kartons argue “this characterization falls within the scope of the type of advocacy approved in People v. Spector ….” The Spector case did not involve attacks on the integrity of opposing counsel. This argument fails.

In short, in this appeal the Kartons have come out swinging, apparently believing the best defense is a good offense. This approach demonstrates the trial court was within its discretion to conclude the Kartons conducted litigation that was less than civil.

In sum, these five grounds were sound bases for reducing the requested attorney fee from about $300,000 to $90,000….

Disclosure: The judge whose decision on this point was affirmed by the court, L.A. Superior Court Judge Elaine Mandel is a very dear friend of mine, but I didn’t even notice this was her case until I was about to put up the blog post.

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