Category: reason

New permitting and registration fees have killed off at least one bike-sharing company previously operating in Dallas, Texas.

Which means that instead of helping people commute, run errands, or visit friends, thousands of yellow bikes previously operated by Ofo, a Beijing-based bike-sharing firm, are now heaped in a city recycling center like a massive modernist monument to poor civic policy.

Ofo decided to pull out of Dallas after the city passed new rules requiring an $800 registration fee and permit fees of $21 per bike, according to The Dallas Morning News. While there were more than 20,000 shared bikes available in Dallas—including roughly 5,000 operated by Ofo—before the city’s new registration fee system went into effect, there are now only about 3,500 such bikes available, the paper reports.

Bike-sharing companies and other app-based transportation options like electric scooters have popped up in many major American cities over the past two years, offering a competitively priced alternative to struggling public transportation systems and ride-sharing services. They are hip, useful, and environmentally friendly—in other words, they are everything that city transit planners usually love, except for the fact that they are operated by private companies instead of as public monopolies.

They also operate on razor-thin margins, with users typically paying only $1 per ride, plus additional per minute costs of a few pennies. It’s the type of business model that might struggle to survive if subjected to huge fees like the ones imposed in Dallas.

But judging from some reactions, people are happy to blame the victim for the pile of useless yellow bikes waiting to be melted down and recycled. People including Dallas Mayor Mike Rawlings.

Terrible. -MR https://t.co/puYnMuAjSV

— Mike Rawlings (@Mike_Rawlings) August 5, 2018

Others have criticized Ofo for not donating their bikes to youth centers or other charitable causes after the company decided to cease operations in Dallas—something the company said it did with bikes that were in good working condition.

But criticizing Ofo for it’s decision to trash bikes or donate them is missing the point. All those brightly painted bikes would still be serving as a useful and affordable transportation alternative if city officials had not driven Ofo out of Dallas. Rawlings can use Twitter to throw shade at Ofo all he wants, but his city government is what’s ultimately responsible for that big pile of useless bikes.

Terrible, indeed.

Your outrageous cannabis story of the day—maybe even the summer—comes from Clare County, Michigan, where 80-year-old Delores Saltzman, a great-grandmother and arthritis patient, was jailed for the first time in her life after a Clare County deputy found her in possession of a small amount of medical marijuana and an expired medical cannabis recommendation.

Marijuana Moment’s Chris Roberts reports that

Saltzman had been a medical cannabis patient for about four years when Clare County Sheriff’s Deputy Ashley Gruno visited Saltzman’s home at around 9 p.m. on June 13.

According to court records, Deputy Gruno was there to locate Saltzman’s great-granddaughter, who had lost her phone and ID, when she smelled marijuana while on Saltzman’s porch.

Saltzman told the deputy the marijuana was hers. She also revealed that while she was a licensed medical marijuana patient, she had let her recommendation expire.

The officer seized “several pipes, four joints and one purple jar” with less than an eighth of an ounce of cannabis, Saltzman said.

The deputy then searched the octogenarian’s bedroom, handcuffed her and took her off to jail for the night, where cold conditions severely aggravated her arthritis, she said.

There is no pretense of protecting public safety in cases like this one and no remotely believable argument that arresting Saltzman for unlicensed cannabis possession served as punishment for crimes the state can’t prove (two arguments prosecutors routinely trot out to justify charging drug offenders). In fact, Clare County Prosecutor Michelle Ambrozaitis dropped the charges against Saltzman after the elderly woman renewed her medical marijuana card. Hell, she even made the entire fiasco sound reasonable:

“[O]ur goal is to ensure that individuals who utilize medical marijuana are doing so legally,” Ambrozaitis wrote in a statement provided to Fox 17. “As such, Ms. Saltzman was encouraged to obtain her medical marijuana card and if she did so, the case would be dismissed. She did obtain her medical marijuana card and the case was dismissed.”

A better goal might be training law enforcement officers to use discretion, not waste taxpayer dollars, and avoid traumatizing elderly residents. A citation should’ve been the most drastic action Deputy Gruno even considered, and her prosecutor should know better than to justify the excess Gruno displayed. I am frightened for the residents of Clare County that they are policed by people who think any of this was necessary or appropriate.

This kind of thing may be happening less as more and more states reform their marijuana laws, but the fact that it continues to happen anywhere, ever, is a reminder that the enforcement arm of the state seldom honors the spirit of a drug reform law if it doesn’t have to.

Today Washington imposed sanctions on anybody doing business with Iran’s automotive sector. Companies selling car parts and services in Iran could be denied U.S. export licenses, frozen out of government contracts, and have visa applications for their corporate officers rejected. The new sanction also target anyone who helps the Iranian government purchase U.S. banknotes or precious metals.

“The Iran sanctions have officially been cast. These are the most biting sanctions ever imposed, and in November they ratchet up to yet another level,” President Donald Trump wrote on Twitter this morning. “Anyone doing business with Iran will NOT be doing business with the United States. I am asking for WORLD PEACE, nothing less!”

The sanctions themselves are hardly a surprise, coming three months after the administration announced it was terminating the 2015 Joint Comprehensive Plan of Action, which lifted financial and trade restrictions on Iran in exchange for limits on the country’s nuclear program. They are nevertheless inflaming tensions both within Iran itself and among America’s European allies, who were far more committed to the 2015 agreement and whose companies were quick to reinvest in Iran following the rollback of sanctions.

“We deeply regret the re-imposition of sanctions by the U.S.,” say the chief diplomats of France, the United Kingdom, Germany, and the European Union in a joint statement. “We are determined to protect European economic operators engaged in legitimate business with Iran.”

The E.U. Commission has enacted a statute that prohibits European companies from complying with U.S. sanctions without explicit permission from the European Union. This so-called “blocking statute” gives business a rather nebulous instruction to ignore “any requirement or prohibition” of U.S. Iran sanctions; what exactly this will look like in practice, or what kind of penalties the E.U. might bring against sanction-abiding companies, is anyone’s guess. The European law also allows these businesses to recover damages from any institutions helping to enforce U.S. trade sanctions.

This leaves such firms as the French automaker Renault and the German engineering company Siemens—both of whom had invested in Iran’s auto industry—between a rock and a hard place, unable to satisfy the mutually exclusive demands of E.U. and U.S. policymakers.

Both companies announced plans to scale back their Iranian dealings prior to today’s sanctions. Honeywell, Boeing, General Electric, and other American companies have similarly said they’ll be exiting the country.

In Iran itself, the sanctions have sparked protests from citizens increasingly frustrated with their government and its continuing isolation. Reuters reports that crowds of demonstrators numbering between a few dozen to a few hundred took to the streets in Tehran and nearby towns, chanting anti-government slogans like “death to the dictator” and throwing rocks.

Both the Iranian protests and the decision of some European companies to back out of the country have been treated as a win by U.S. National Security Advisor John Bolton, who said Monday that “reimposition of sanctions has already had a major effect.”

The Iranian-American commenter Hamid Zangeneh rejects this notion, saying the Trump administration’s hardline anti-Iranian actions have only undermined the U.S.’s reputation with the Iranian public.

“In general, Iranians, unlike their government, sentimentally have been pro-American. Yet, they have been shunned by the Trump administration, through the imposition of an unjust travel ban and now resumed sanctions,” writes Zangeneh in an article for the Atlantic Council. “The Iranian government has exploited these issues to whitewash social, economic and political failures caused by its own mismanagement and corruption.”

It’s laughable to think these sanctions will get the country to come to the table, let alone agree to U.S. demands that it open all its military facilities to international inspection, roll back its support for pro-Iranian factions across the Middle East, and become best friends with Israel. At best, this attitude shows a naive belief that threats and bullying will convince the world’s nations just to lay down and accept U.S. demands. At worst, it suggests that the Trump administration is not really interested in coming to an agreement with Iran at all.

Here’s one for the Summer of Snitches file. A New Jersey family thought they were doing neighborhood kids a favor by opening up a free “mailbox library” on their own property and filling it with books. One neighbor apparently didn’t agree.

“We thought it was a really fantastic idea,” Grace Hagemeyer says of the little free library, which she and her husband Peter set up in front of their house in Point Pleasant Borough, New Jersey. Little free libraries, which have become a nationwide phenonenom, aim to expose children to various books. “We have three children who love to read. It’s so cool to think that kids would be running back and forth with books, trading with each other,” Grace tells NJ Advance Media.

But then someone called the cops. “We had a grand opening on [July] 29. The 29th is when we had a visit from the police,” Grace tells News 12.

A day after that, code enforcement officers informed the Hagemeyers of the library’s specific infractions. The problem, Advance Media reports,

was that the mailbox stood more than 2 and a half feet tall, meaning it would have to be placed 10 feet from the property line. Another issue, she was initially told, was that such libraries are not allowed because they’re not mentioned in the land-use ordinance.

The Hagemeyers were given 10 days to comply. But they couldn’t understand why someone had such an issue with their library in the first place. “I’m still trying to wrap my head around the fact that this is such a problem,” Grace says to Advance Media. “It’s a waste of time, it’s a waste of resources. Police should not be knocking on people’s door because they want to give away books.”

Point Pleasant Borough Administrator Frank Pannucci admits the situation “got blown out of proportion” because a neighbor decided to involve police. “There’s nothing wrong with [the library] itself,” he tells Advance Media. Instead of taking the library down, he says the Hagemeyers need to move it back. “You can’t have the little free library there, because you’re going to have kids walking down the street. It’s causing a hazard.”

Pannucci says other mini-libraries in the area are probably fine.

Incoming female students at Harvard University will have one less Greek-Life option now, thanks to the school’s recent restrictions on single-sex organizations. The Zeta Phi-Cambridge Area, a chapter of the Delta Gamma organization, has chosen to disband rather than comply with the new rules.

In the spring, Harvard Delta Gamma members had signed a letter (“We Believe Women Should Make their Own Choices“) along with two other sororities, Alpha Phi and Kappa Alpha Theta, expressing their plans to continue operating and continue recruitment of female students.

“We realize that including freshman women as members in our organizations is in contravention of the current sanctions Harvard’s administration has imposed on single-gender social groups,” said the letter. “Yet penalizing our future members for their involvement in a sorority, in reality, denies them access to member-driven education and support systems shown to be effective in battling sexual assault, as well as alcohol abuse, mental health issues, and the particular challenges inherent in college life.”

But in May, Delta Gamma national voted to instead shut down its Harvard chapter entirely.

“The decision does not mean that we are succumbing to the university’s new sanctions and policies regarding participation in unrecognized single-gender organizations like ours,” Wilma Johnson Wilbanks, Delta Gamma president, said in a press release. “We will continue to champion our right to exist on campuses everywhere.”

Some former members of Harvard Delta Gamma have formed a new organization called Kali Praxi, a co-ed social organization.

Additionally, Kappa Alpha Theta announced in July that “Harvard’s chapter of the all-female sorority Kappa Alpha Theta will become the gender-neutral social group ‘Theta Zeta Xi’ and will disaffiliate from its national organization in the fall of 2018,” according to Harvard student newspaper The Crimson.

Not all affected organizations have been willing to go away without a fight. Numerous all-male organizations have gone to lobby members of Congress to pass the PROSPER Act, a piece of legislation that can pressure universities to avoid penalizing student for joining single-sex organizations or lose federal dollars. In its current state, the bill would not impact current Harvard but students are hoping to convince Congress to add provisions that would impact them.

The Yale Daily News has speculated that if lobbying efforts are unsuccessful then students may pursue a lawsuit.

New Orleans courts have long relied on money snatched from defendants through fees and bail bonds; the people who can’t pay get locked up. But now two federal rulings could push the courts away from that system.

On Friday, U.S. District Judge Sarah Vance ruled that Orleans Parish Criminal District Courts were unconstitutionally jailing people for failure to pay court fines and fees without any sort of neutral forum or any consideration of whether they had the ability to pay. And on Monday, U.S. District Judge Eldon Fallon ruled that Orleans Parish Magistrate Judge Harry Cantrell violated the constitutional rights of defendants by arbitrarily setting high bail requirements without any consideration of whether they could pay them and without any willingness to consider alternatives.

At the heart of both rulings is a court system that uses the money generated by these practices to fund itself, a fact that compromises the neutrality of the judges’ decisions. The Orleans Parish criminal court gets more than half of the revenue for its general fund from fines and from a 3 percent fee it collects from bail bonds. Judges thus stand to benefit from the fines and fees.

According to the complaint against Cantrell, the judge had a practice of setting a minimum of $2,500 for bail, regardless of the charges; he did not consider or care whether defendants were able to pay. He resisted letting defendants post unsecured bonds on their own (meaning they wouldn’t have to pay up front and would owe the court money only if they didn’t show), and he pushed defendants to go through bail bondsmen, guaranteeing the court would get a cut of the money the defendant paid. Court transcripts show him going so far as to threaten defense attorneys with contempt for trying to request bail reductions.

Bail is not supposed to be a way courts can fund themselves. Bail is supposed to be a form of security to make sure a defendant shows up for trial. Making it a source of revenue gave Cantrell an incentive not to care whether it was necessary in any particular case. Indeed, it created a conflict of interest: When Cantrell assigned higher cash bail amounts, the courts made more money. As Judge Fallon notes in the ruling, “Judge Cantrell’s participation in the management of the [court’s general] Fund in conjunction with his determination of Plaintiffs’ ability to pay bail and the amount of that bail is a substantial conflict of interest that produces a ‘possible temptation…not to hold the balance nice, clear, and true between the state and the accused.'”

After the bail lawsuit was filed last year, Cantrell informed the court that he has instituted changes to add some actual due process to his decisions and not just spit out demands for $2,500. Fallon said in the decision that he appreciated Cantrell’s openness to changes, but he added that proper due process required the judge to consider both the defendant’s ability to pay bail and whether alternative conditions could be considered for a defendant’s release.

Both of these cases have been advanced by lawyers with the Civil Rights Corps. For the bail case, they partnered with the MacArthur Justice Center. For the debtors’ prison case, they partnered with the Lawyers’ Committee for Civil Rights Under Law and the law firm of Orrick, Herrington & Sutcliffe. You can read more about each lawsuit here and here. The Civil Rights Corps has been involved in fighting excessive bail systems across the country, and Reason interviewed the group’s founder, Alex Karakatsanis, for our cover story on the growing bail reform movement. Read that here.

A bill signed into law yesterday by New York City Mayor Bill de Blasio will allow all inmates in city jails to make free phone calls.

“This piece of legislation will ensure that no incarcerated person will have to pay to reach their loved ones on the phone and maintain crucial connections to the support networks key to their rehabilitation,” de Blasio said in a statement.

In the 2017 fiscal year, 76 percent of NYC Department of Correction (DOC) inmates were pretrial detainees, meaning they had not yet been convicted. But unless they could pay up, their criminal status (or lack thereof) didn’t matter. The New York Time reports:

Currently, calls from Rikers Island cost 50 cents for the first minute and 5 cents for each additional minute to local numbers. There are 26,000 calls from the city’s jails every day that generate more than $20,000 in daily revenue, according to an analysis by the Corrections Accountability Project, which advocated for the bill.

The DOC already allows some inmates to make calls free of charge. But the new law, which was approved by the city council in July and takes effect in nine months, makes New York the nation’s first major city to guarantee free calls for all inmates.

The city estimated that in the 2019 fiscal year, it would collect about $5 million in revenue from inmate telephone fees. The city itself doesn’t manage the phones in its jails. Instead, it contracts with Securus, a private company that rakes in about $2.5 million a year from the deal. According to the Times, NYC “will still likely pay a private company that amount.”

Elias Husamudeen, president of the city’s correction officers’ union, is concerned the bill will allow gang leaders to maintain control even while incarcerated. “This is just one more nail in the coffin of creating safer jails, to be honest with you,” he tells the Times.

But the law has garnered praise from prison reform advocates. “People who are incarcerated, and especially people who are incarcerated pretrial without conviction, should be able to contact lifelines without cost,” Bianca Tylek, director of the Corrections Accountability Project, tells the Times.

City council Speaker Corey Johnson, who sponsored the law, expressed similar sentiments. “No one should have to choose between speaking to their loved ones and paying the bills and I am proud to say that New Yorkers with loved ones who are incarcerated will no longer have to make this decision,” Johnson said in a statement.

Judging by President Donald Trump’s favorite metric—America’s trade deficit—he is losing his trade war.

Luckily, trade deficits don’t matter too much.

According to data released Friday by the U.S. Census Bureau and the U.S. Bureau of Economic Analysis, America’s trade deficit rose to $46.3 billion in June, up from $43.2 billion in May. A trade deficit is the gap between the amount of goods a country exports and imports—the amount it “sells” versus the amount it “buys”—and June’s increase was driven by a less than 1 percent uptick in imports along with a comparatively small reduction in exports.

Trump worries a lot about the trade deficit. He’s argued that America’s trade deficit is such a threat to domestic manufacturing that it justifies an expensive trade war. In announcing tariffs targeting Chinese goods in March, Trump specifically pointed to America’s trade deficit—”it’s out of control,” he said at the time—as one of the justifications for the bellicose trade actions. Going back to his time as a presidential candidate, Trump has singled out the trade deficit as a serious problem, pointing to it as evidence that China is “killing us” on trade. As president, Trump has made reducing the trade deficit a main policy goal, asking not only Chinese officials but also those from the E.U. and Canada (a country with which America has a trade surplus) to reduce their deficits by buying more American goods.

Politically, Trump has used the trade deficit as an easy way to signal his support for blue collar workers and to justify protectionism. Economically, though, there’s really not much reason to worry.

In fact, a rising trade deficit can be a good thing.

“Despite the false narrative of rising trade deficits leading to U.S. job losses, the exact opposite has been true for nearly the last half-century,” says Mark Perry, an economist at the American Enterprise Institute and editor of the think tank’s Carpe Diem blog. “Increases in the U.S. trade deficit are associated with rising, not falling, employment levels in the U.S.”

It’s also worth keeping in mind that the trade deficit isn’t something that the leaders of two countries can really negotiate. Sure, governments can impose policies that favor or disfavor trade, but the existence of a trade surplus or deficit is the result of millions of individual decisions made by businesses and consumers in the United States and China.

“People typically forget that the imports that make up the U.S. trade deficit are, like all American imports, goods and services that Americans voluntarily purchase—meaning, goods and services each of which is judged by its American buyer to be worth more than the money paid for it,” writes Don Boudreaux, an economist at the Mercatus Center, a free market think tank based at Virginia’s George Mason University.

None of those exchanges are forced. American consumers and businesses voluntarily trade their dollars for imported goods. Cutting off that trade, Trump has argued, would “save us a hell of a lot of money,” but that really misses the point. You’d save a hell of a lot of money if you didn’t buy groceries every month, but you probably wouldn’t be better off.

As long as the national economy remains strong, America will likely continue to run a trade deficit and an investment surplus—the result of personal consumption being high and the United States remaining an attractive place for investments. Indeed, the trade deficit essentially disappears if you also consider foreign investment in America as a form of trade, which it really is.

Trump’s continued obsession with the trade deficit remains a bit of a mystery. It could be, as Reason editor-in-chief Katherine Mangu-Ward speculated on yesterday’s edition of the Reason Podcast, that Trump fails to understand the distinction between the budget deficit and the trade deficit. This actually makes a lot of sense, particularly in light of the president’s bizarre tweet over the weekend suggesting that tariff revenue could be used to pay down the national debt. After all, tariffs generate tax revenue and tax revenue is what you need to reduce the deficit—the budget deficit.

But economists mostly agree that tariffs won’t do much of anything to reduce the trade deficit—though tariffs could have a secondhand effect on the trade deficit if they become severe enough to slow the economy as a whole and reduce consumer spending, which is the thing that really drives the trade deficit.

“A country is far more likely to run a trade deficit when its economy is booming and personal consumption is high,” writes Daniel Drezner, a professor of international politics at Tufts University, in The Washington Post. “If Trump really wanted to shrink the trade deficit, he would push to revoke his own tax bill. But he really does not want to do this.”

Unfortunately, a widening trade deficit combined with Trump’s apparently faulty understanding of what’s driving the trade deficit could be a formula for an escalating trade war—a war that could do a lot of damage without accomplishing what the president wrongly thinks it will.

Baltimore just took a big step toward becoming the nation’s first major city to ban the privatization of its water and sewer system.

The Baltimore City Council overwhelmingly approved a charter amendment yesterday that makes the sale or lease of its water system illegal, The Baltimore Sun reports. The measure ensures that the public owns and controls the water system.

Baltimore Mayor Catherine Pugh, who supports the measure, has until August 13 to sign it. Then, it will be put on the ballot for voters to approve or reject in November.

City council President Jack Young, who proposed the amendment, thinks voters will approve it. “I think overwhelmingly the citizens of Baltimore are going to vote to keep a system that’s an asset to them,” he said, according to WBAL. “I think they’re smart enough to realize that this belongs to them. It doesn’t belong to me, personally, it belongs to the citizens of Baltimore. I want to make sure that it stays that way.”

For years, companies have been making the case for privatization. The French company Suez Environment, for instance, has proposed what seems like a mutually beneficial deal. The Sun reports:

Suez—a descendant of the company that built Egypt’s Suez Canal—has pitched city officials on a lease agreement in which the company would pay the city upfront to take control of operating Baltimore’s water system and then collect the money charged from water bills. The company has said it would hire current Department of Public Works employees, honor union contracts, and pledge to raise water rates only minimally.

Proponents of a ban on privatization say it would raise rates and generally hurt customers. “Communities that have privatized their water systems see skyrocketing rates, lost jobs and declined quality of service, because when corporations come in to run water and sewer systems, they have one goal and one goal only, and that is profit, not the public good,” Rianna Eckel, a state organizer for the advocacy group Food and Water Watch, tells WBAL.

But private companies’ concerns about making a profit may actually help consumers. As Reason‘s Adrian Moore noted in 2016:

Private utilities simply borrow the money to build new water supply pipelines or treatment plants when they need them, and they have every incentive to build them fast and keep costs down. In contrast, for a municipal utility it is a long and painful political process, fighting against other agencies and political priorities, to get approval to borrow money to build new facilities.

Plus, privatizing water systems and other utlities means less long-term risk for cities. “Sales and leases,” says Reason Foundation policy analyst Austill Stuart, “allow cities to transfer risks of deferred maintenance to the private sector.”

According to the National Association of Water Companies, private water companies serve nearly 73 million people on a daily basis. These private utilities are accountable to their customers, and that accountability motivates them to provide better service. Unfortunately, Baltimore residents may never get the chance to experience such benefits.

A young girl in Iowa has learned the hard way that even doing something as innocent as selling cookies without a permit can warrant a police response.

Savannah Watters, who dreams of owning her own bakery, thought of a way to raise money for her school clothes this year. With an entrepreneurial spirit and a batch of cookies from her mom, the young girl decided to host a cookie sale in her Cedar Falls neighborhood.

That’s when Cedar Falls Police Chief Jeff Olson said his department received three calls over the span of five days about the cookie business.

Why call the police on a 10-year-old selling cookies?

One neighbor said that she did so out of concern for other neighborhood children. She claimed that her own daughter was almost hit by a car belonging to one of Watters’ customers.

“Well, we’ve got a little girl been selling cookies and water for four weeks and the traffic is getting to the point that they’re using our driveway to turn around, which is fine, but they almost hit my daughter,” the neighbor said in a phone call to emergency services. “I mean, it’s just adding. It’s getting out of control.”

Another neighbor called to conduct a welfare check to make sure Watters was being properly supervised.

“I wish that we could have known first, ’cause we didn’t know anything. And it’s just hard to believe that they didn’t come talk to my mom first,” Watters said, reports KDSM-TV. According to WRIC, her mother similarly stated, “I am not a bad person and I am a good mom, and I would never risk, you know, and I didn’t know anything that anyone was bothered, and so I just wish they were to come to me instead of making it all of us you know all of this.”

Police have since informed Watters that she can sell her cookies as long as she remains in the driveway. Unfortunately for Watters, she reported that the change in visibility hurt her business.

Bonus link: Stories like this make us wonder if 2018 is the Summer of Snitches?