One Reason for New York’s Pitiful Rollout of Legal Pot: License Preferences for Victims of Prohibition


More than two years after legalizing recreational marijuana, New York has just 12 licensed retailers.

It has been more than two years since New York notionally legalized recreational marijuana, and things are not going quite as planned. “Although Gov. Kathy Hochul suggested last fall that more than 100 dispensaries would be operating by this summer,” The New York Times notes, “just 12 have opened since regulators issued the first licenses in November.”

Part of the problem, as you might expect, is red tape and bureaucratic ineptitude. But another barrier to letting licensed marijuana merchants compete with the unauthorized vendors who have conspicuously proliferated since the spring of 2021 is the state’s affirmative action program for victims of pot prohibition.

New York, like several other states that have legalized marijuana, mandated preferences for license applicants who suffered as a result of the crusade against cannabis. While that idea has a pleasing symmetry, it never made much sense as a way of making up for the harm inflicted by cannabis criminalization. And in practice, executing the plan has drastically limited the legal marijuana supply, making it much harder to achieve the state’s avowed goal of displacing the black market.

To be clear: I don’t think people with marijuana convictions should be excluded from participating in the newly legal market, a policy that would add insult to injury. But that does not mean they should have a legal advantage over cannabis entrepreneurs who were never arrested but might be better qualified.

The state arguably does owe something to people who were punished for engaging in a business it has now decided to legalize. But why should reparations take the form of marijuana license preferences, as opposed to, say, direct financial compensation for legal costs and lost liberty? The method New York has chosen is limited to people who are currently interested in selling cannabis, which illogically excludes many others who were injured by enforcement of the state’s marijuana laws.

New York reserved the first batch of up to 175 retail licenses mainly for people with marijuana-related criminal records or their relatives. Those applicants needed to show they had experience running a “profitable” legal business in the state. Nonprofit organizations with “a history of serving current or formerly incarcerated individuals” also were eligible, provided they had “at least five full time employees,” “at least one justice involved board member,” and a track record of operating “a social enterprise that had net assets or profit for at least two years.” Another requirement was demonstrating “a significant presence in New York State,” which led to litigation and a temporary injunction against issuing retail licenses in five areas of the state.

Satisfying the state’s criteria required “a lot of documentation,” Bloomberg CityLab reporter Amelia Pollard noted last fall, which gave New York’s Office of Cannabis Management (OCM) “a mound of paperwork to wade through.” As of November, the OCM had received more than 900 applications from would-be marijuana retailers. On November 20, it announced that it had granted 36 “provisional conditional adult-use retail dispensary licenses” to individuals and organizations.

The first licensed shop to open for business, owned by the nonprofit organization Housing Works, began operating in Manhattan on December 30, just barely in time to keep the OCM’s oft-stated promise that legal recreational sales would start by the end of 2022. A month later, Hochul proudly announced the opening of the “first New York cannabis dispensary owned by a justice impacted individual”: Roland Conner, who was convicted of selling pot as a teenager in the 1990s.

Hochul noted that Conner had “owned and operated property management businesses in New York City for fifteen years.” She said he planned to launch his Greenwich Village store, Smacked!, with “a soft opening as a ‘Pop-up’ through February 20.” According to the store’s website, it is “temporarily closed while we get our new retail location ready for our grand re-opening.” Although “we are unable to take orders right now, either online or in person,” it says, “we’ll be opening up again soon with home delivery as an option.”

Those two outlets were later joined by 10 others. That’s a dozen licensed retailers—seven in New York City, plus one each in Albany, Binghamton, Ithaca, Plattsburgh, and Schenectady—in a state with 20 million residents, about a fifth of whom are cannabis consumers.

New Yorkers are not yet allowed to grow marijuana at home, a step that legislators worried would make it harder for licensed merchants to attract customers. But not to worry: The approved retailers are far outnumbered by unauthorized vendors, many of whom openly sell marijuana from storefronts, trucks, and tables, unencumbered by the state’s licensing requirements, regulations, and taxes. Yelp’s list of the “best recreational marijuana dispensaries” in New York City includes 90 outlets, only a few of which are blessed by the OCM.

What happened? In theory, plenty of assistance is available to budding marijuana merchants under New York’s “social and economic equity” initiatives. But many licensees say the state has been more of a hindrance than a help.

“In a letter to regulators and the governor’s office last month, a coalition of dozens of the prospective dispensary operators described being blocked by the state from selecting their own storefront locations,” the Times reports. “Some said that they felt pressured to accept inflated rents and construction costs, while others said that the state was withholding funding from those who wanted to lease space or handle matters on their own.” While the licensees “said that they appreciated how the state’s tight control over the program was meant to benefit them,” they found that it was actually “holding them back.”

Gahrey Ovalle, a Long Island businessman who signed the letter, said he and his brother, whose marijuana conviction qualified them for a retail license in April, sought advice from licensees who had started sooner and should have been further along in the process. Ovalle told the Times he was dismayed to learn those licensees were “in the same space as us,” even though “we came along six months later,” which was “very alarming.”

Carson Grant, a Queens businessman who was one of the 36 initial licensees last November, said “officials have yet to answer his most basic questions—’How much is this going to cost me? Where is my loan agreement?'” He “was beginning to fear that licensees have been set up to fail.” The experience “has been traumatic for all of us,” Grant told the Times, because “there’s no clear direction” and “no full transparency.” Despite his business background, he complained, “I’m just not being treated like a business person who makes business decisions, which to me could lead to my failure, my family’s failure.”

The delays have created problems not only for aspiring retailers but also for growers and processors who made the mistake of believing the state’s promises. As the Times notes, they are now “holding hundreds of millions of dollars in crops that are slowly deteriorating.” Some “said they were facing the loss of their land and businesses.”

In a concession of the state’s abject failure to get the recreational marijuana industry off the ground, OCM’s Cannabis Control Board “voted last month to allow the major cannabis firms behind the state’s medical marijuana program to wade into the recreational market in December—two years ahead of time.” That decision came “two months after some of the medical marijuana companies sued regulators to gain entry to the recreational market.”

Expanding the market, the Times worries, “will put the smaller dispensaries run by people with past marijuana convictions, currently the only ones who can legally sell recreational marijuana, into direct competition with large companies that have all but shut out small players in other states.” But if the state had not constrained the retail supply in the first place, the legal market would not be in such a pitiful state. “The New York authorities are almost promoting illegal cannabis,” Curaleaf Executive Chairman Boris Jordan, who runs one of those “large companies,” complained in February.

Another likely response to the disastrous rollout of recreational marijuana in New York is a crackdown on the unlicensed dealers who are serving a market that the state has deliberately prevented legal retailers from serving. That response seems more politically probable than a rollback of the licensing barriers, regulations, and taxes that have allowed the black market to continue thriving. But it will entail the same sort of injustices that New York sought to rectify with its misguided plan of preferences for selected victims of the war on weed.

The post One Reason for New York's Pitiful Rollout of Legal Pot: License Preferences for Victims of Prohibition appeared first on Reason.com.

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Santa Monica Residents Push Back Against Outdoor Needle Distribution Site For Homeless

Santa Monica Residents Push Back Against Outdoor Needle Distribution Site For Homeless

Authored by Rudy Blalock via The Epoch Times,

Some residents in Santa Monica, an idyllic beach town in Southern California, are pushing for an outdoor county-operated program that distributes clean syringes weekly to homeless drug users near the city’s parks to be moved indoors to a county-owned facility.

The “overdose prevention program”—which is overseen by the Los Angeles County Department of Public Health’s Division of Substance Abuse Prevention and Control—currently distributes syringes, first aid kits, opioid overdose reversal medication, and hygiene kits every Friday at three city parks, according to a spokesperson for the department.

Members of the Santa Monica Coalition, a group of retail and commercial tenants, residents, and property owners, are looking to put an end to the syringe distribution, which they say has been operating without public knowledge since 2019.

According to John Alle, who owns property on the Third Street Promenade, some city officials weren’t even aware of the county-funded program until he brought it to their attention a year ago.

“We raised it. We went to the local papers, and we wrote letters directly with photos to the city council and to downtown Santa Monica business owners and residents, so they had to address it,” said Alle, who also helped found the coalition.

The recently closed Wetzel’s Pretzels of Santa Monica, Calif., on June 2, 2023. (John Fredricks/The Epoch Times)

City Councilman Oscar de la Torre confirmed that he only learned of the program after Alle first raised the issue.

“There was never any discussion. We never really talked about it in city council meetings. It’s never been agendized, so it was kind of a shocker for me to just hear that that was going on,” he told The Epoch Times.

The county’s health department works with the Venice Family Clinic, a community health center with several locations in the Los Angeles area to carry out the distribution of medical supplies, including needles. According to the coalition, Santa Monica is the only city in the country that currently has a publicly funded outdoor needle distribution program.

The City of Santa Monica and the County along with Venice Family Clinic have been operating the only open-air, publicly funded needle, condom, and synthetic distribution program in the country,” reads a petition created by the coalition in March that has since received 8,000 signatures.

Petitioners are asking the city of Santa Monica to “force the County to move their distribution program indoors under medical supervision with supportive services.”

Some residents say they’re concerned that outdoor giveaways could lead to an increase in homelessness, drug use, and crime.

A Venice Family Clinic van is seen in a park in Santa Monica, Calif. (Courtesy of John Alle)

City officials sent a letter to the Los Angeles Board of Supervisors in September 2022 asking for the program to be halted in and near parks, noting that a large majority of residents are renters and rely on parks for open space.

“Because roughly 70 percent of Santa Monicans are renters, our community relies on the City’s parks and open spaces as they do not have access to private open space,” reads the letter, signed by then-Mayor Sue Himmelrich.

The city asked for the program to be moved to a “service-rich environment,” instead, that was “preferably” indoors inside a county-owned facility, with services for substance abuse and mental health.

De la Torre told The Epoch Times that county officials did respond, saying the distribution would instead be done from a van, parked near the parks.

But Alle said that’s not the case.

Recently, he posed as a homeless person at one of the parks and was almost given a syringe—until it became clear that he was testing the program—by one of the nonprofit’s social workers, when he told them he was unable to walk to the van to retrieve it for himself, he said.

“They’re not only operating from inside the van. They were giving out supplies to people in the park,” Alle said.

John Alle is seen in a recent photo disguised as a homeless person in Santa Monica, Calif. (Courtesy of John Alle)

Alle said he and two colleagues observed three workers of the clinic passing out Narcan—an opioid reversal medication—condoms, and syringes to several homeless people in the parks that day.

Officials from the Department of Public Health didn’t return a request for comment on the allegations.

According to Alle, such programs have exacerbated the city’s homeless and crime crisis.

He recounted how he leased one of his properties on the promenade to the NFL for a pop-up store this year in advance of the February Super Bowl. But the football league asked for its money back after less than a week, he said.

“After six days [they] said ‘John, we’ve had three break-ins, two of our employees have been hit over the head going to their cars, and we have people pissing against our windows during the day,’” Alle said.

According to Alle, the promenade is roughly 50 percent vacant now.

The clinic began passing out items in the area in 2019 at six locations in the city, including along Third Street Promenade.

The locations have now been reduced to three parks.

Bryan Paarlberg, who receives free meth pipes from the Venice Family Clinic, sits near his collection of items in Santa Monica, Calif., on June 2, 2023. (John Fredricks/The Epoch Times)

“Los Angeles County is currently experiencing the worst overdose crisis in its history, and overdose prevention services are critical to save lives and protect public health and safety,” a public health department spokesperson said.

Restricting access to such services will only lead to more overdoses and “exacerbate” the homelessness crisis, according to the spokesperson.

“As part of our commitment to save lives and protect public health, we are in constant communication with Santa Monica officials to address community concerns and needs,” the spokesperson said.

A family uses a playground near a homeless man in Santa Monica, Calif., on June 2, 2023. (John Fredricks/The Epoch Times)

According to the health department, the clinic distributes 200 syringes at the three Santa Monica locations every month to 100 people and disposes of the dirty needles.

It also refers those interested in substance use treatment services and refers individuals for free HIV or hepatitis C testing.

Tyler Durden
Tue, 06/06/2023 – 18:45

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US Knew Ukraine Planned To Blow Up Nord Stream Pipeline 3 Months Before It Happened: WaPo

US Knew Ukraine Planned To Blow Up Nord Stream Pipeline 3 Months Before It Happened: WaPo

The Washington Post is reporting that an unnamed European intelligence service told the CIA that Ukraine’s military was planning an attack on the Nord Stream pipelines a full three months before the September 26, 2022 sabotage blasts which disabled them.

The revelation is based on Pentagon and classified intelligence documents leaked by Air National Guard member Jack Teixeira, or part of the so-called Discord leaks. The intelligence report in question was drafted in June 2022 and shared with the Biden administration, which means the White House has known all along that the “Putin did it” narrative which the West rallied around was false from the start. According to the new report published Tuesday

Details about the plan, which have not been previously reported, were collected by a European intelligence service and shared with the CIA in June 2022. They provide some of the most specific evidence to date linking the government of Ukraine to the eventual attack in the Baltic Sea, which U.S. and Western officials have called a brazen and dangerous act of sabotage on Europe’s energy infrastructure.

Image: AFP

Among the more interesting aspects to the intelligence leak is that it says the Ukrainians conducting the sabotage operation reported directly the country’s top military officerGen. Valerii Zaluzhnyi, in order to avoid sharing it with Ukrainian President Volodymyr Zelensky, likely for the sake of plausible deniability. 

The US government reportedly saw the information as of enough importance or authenticity to share it with Germany and other European intelligence services. It appears to be based on a single source or asset in Ukraine: “The intelligence report was based on information obtained from an individual in Ukraine” – as the Post report indicates.

The intelligence describes a plot which is very similar to a theory which recently came to prominence as German investigators spent months attempting to uncover a culprit, which claimed that six individuals under false identifies utilizing a small boat conducted a deep diving operation in the Baltic Sea to plant the explosives on the pipeline. 

The Washington Post writes in its Tuesday report, “The highly specific details, which include numbers of operatives and methods of attack, show that for nearly a year Western allies had a basis to suspect Kyiv in the sabotage.”

“That assessment has only strengthened in recent months as German law enforcement investigators uncovered evidence about the bombing that bears striking similarities to what the European service said Ukraine was planning.”

And WaPo offers the following verification that European intel services were briefed by the US on the information in its possession: “Officials in multiple countries confirmed that the intelligence summary posted on Discord accurately stated what the European service told the CIA.”

The paper noted: “The Post agreed to withhold the name of the European country as well as some aspects of the suspected plan at the request of government officials, who said exposing the information would threaten sources and operations.”

The timing of this revelation is interesting, as the WaPo report was published the same day as the Kakhovka hydroelectric power plant dam was blown up. In fact, Russians are already seizing on the parallels

Many are now calling it the new Nord Stream sabotage mystery, as just like with the pipeline attack both the Russian and Ukrainian sides are quickly pointing the finger at the other.

One thing is clear in the wake of Tuesday’s Washington Post Nord Stream reporting: the White House is lying about major, war-shaping events related to Ukraine. The US is lying about the conflict, and the US has been lying for a long time

Tyler Durden
Tue, 06/06/2023 – 18:25

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What Are Older Office Towers Worth In The New Era? Second San Francisco Office Tower Sells For 70% Off Original Listing Price

What Are Older Office Towers Worth In The New Era? Second San Francisco Office Tower Sells For 70% Off Original Listing Price

Authored by Wolf Richter via WolfStreet.com,

The burning question arose over the past two years what these largely empty older office towers in San Francisco are worth.

The market had frozen over.

There were no transactions because no one knew what anything was worth as San Francisco’s office market has morphed in just a few years from being one of the hottest office markets in the US with a vacancy rate of 7% in 2019 and some of the highest rents in the US, to being put on ice by working-from-home. About 33% of all office space is now on the market for lease – worse even than Houston, which was for years the worst office market in the US.

So now there’s the second deal in about a month — though the sale hasn’t closed yet. Wells Fargo found a buyer for one of its office towers in San Francisco, the 13-story 355,000-square-foot 1960s-era tower at 550 California, across the street and around the corner from its headquarters tower on Montgomery.

Wells Fargo had purchased the tower in 2005 for $108 million. It is vacating the building. Last year, it listed it for $160 million, but then pulled the listing after receiving bids reportedly below $40 million. Earlier this year, it engaged real estate investment bank Eastdil Secured to relist the tower.

And it has now made a deal – the name of the buyer has not been disclosed – for about $42.6 million to $46 million ($120 to $130 per square foot), according to sources cited by the San Francisco Business Times. That would be 71% below the original asking price and nearly 60% below the purchase price in 2005.

The first tower to find a buyer in the new era of working-from-home and office-footprint reduction had been the Union Bank headquarters tower at 350 California, which changed hands in early May at 75% off the original listing price in 2020, at around $200 to $225 per square foot. But it had undergone $41 million in seismic upgrades and renovations recently.

The price of the Wells Fargo tower ($120 to $130 per square foot) and the price of the Union Bank tower ($200 to $225 per square foot) now serve as benchmark for other older office towers. It seems, as price discovery is beginning to take place, the door has been opened to more deals.

And maybe the buyers, who will have a much lower cost basis, can figure out what to do with those towers, such as leasing office space at lower rents that are attractive to potential tenants, which could then start bringing down the prohibitive office rents in the City.

Office-to-residential conversions are now a hot topic in San Francisco. Everyone knows that if it can happen, it should happen. Earlier this year, the mayor’s office introduced legislation that would amend the planning codes to make conversions easier.  So we’re off to the political races. But a conversion, if it even makes economic sense, will take years.

Neither the Wells Fargo tower nor the Union Bank tower involve defaults, foreclosure sales, and huge losses for creditors. There are no hapless CMBS holders involved that would lose their shirts. The towers did not serve as collateral for debt. Both properties have been owned by banks for many years to use as their offices. But the banks – like most other major companies in the area – are shrinking their office foot print. And in doing so, they’re now establishing benchmark prices.

*  *  *

Enjoy reading WOLF STREET and want to support it? You can donate. I appreciate it immensely. 

Tyler Durden
Tue, 06/06/2023 – 18:05

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FSB Alleges Ukraine Plotted Dirty Bomb Attack On Russian Territory

FSB Alleges Ukraine Plotted Dirty Bomb Attack On Russian Territory

Russia’s Federal Security Service (FSB) has alleged that Ukraine’s military intelligence mulled plans to detonate a “dirty bomb” on Russian territory as retribution for the ongoing invasion. 

The FSB released a Tuesday statement claiming that Ukraine’s Main Directorate of Intelligence (GUR) considered a high stakes plan to utilize a light aircraft capable of flying at low altitudes to fly saboteurs into Russia as well as a dirty bomb, or explosive device covered with radioactive material capable of dispersing contamination over a large area.

Illustrative, Getty Images

The statement said the “terrorist attack” was under preparation but never happened, and the alleged information appears to have been gained in part after interrogation of a captured Ukrainian pilot. 

This comes at a time of near daily cross-border attacks on Russian regions lying near Ukraine, including artillery and rocket attacks, and now multiple instances of ground raids by Kiev-aligned militia men in Belgorod.

According to further details of the alleged plot described in state media:

The Russian agency released footage of an interview with an alleged Ukrainian pilot who was intercepted while flying one such mission. Identified as Dmitry Shimansky, he was detained in May in Tula Region some 200km south of Moscow, when his plane landed to deliver drone parts and explosives for a planned attack on a Russian military airfield.

The pilot claimed that the GUR leadership had considered using the same tactics to prepare a dirty bomb attack in Russia. A dirty bomb is a conventional explosive device covered with radioactive material, which contaminates a large area around it after detonating.

The significant, though unverified, allegation by the FSB comes a day after CNN issued a bombshell report describing how Ukraine is overseeing a network of agents and sympathizers inside Russia who are conducting covert sabotage campaigns inside the country.

Ukraine’s military and intelligence has begun providing the agents with drones to heighten the impacts of the attacks they are staging, CNN was told by multiple US intelligence sources.

“US officials believe these pro-Ukrainian agents inside Russia carried out a drone attack that targeted the Kremlin in early May by launching drones from within Russia rather than flying them from Ukraine into Moscow,” CNN wrote.

The report underscored that “cash works wonders” – given the impact of the ongoing war and the chaotic nature of border security at this point:

A European intelligence official noted that the Russian-Ukrainian border is vast and very difficult to control, making it ripe for smuggling – something the official said the Ukrainians have been doing for the better part of the decade that they’ve been at war with pro-Russian forces.

“You also have to consider that this is a peripheral area of Russia,” the official said. “Survival is everyone’s problem, so cash works wonders.”

This without doubt sets the stage for greater unpredictability and escalation in the war, with President Putin having recently vowed “mirror actions” and retaliation for these attacks on Russian territory. But the cross-border raids from Ukraine are also meant to have a demoralizing effect on the Russian populace, and put it on edge, building pressure on Kremlin decision-makers. 

To some degree this demoralization strategy is having a serious impact, given for example Wagner is using the events in Belgorod to continue its scathing critiques of the Russian military command and top decision-makers.

Tyler Durden
Tue, 06/06/2023 – 17:45

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DeSantis Claims On Chicago Kid Shootings: Hyperbole Or Fact?

DeSantis Claims On Chicago Kid Shootings: Hyperbole Or Fact?

Authored by Ted Dabrowski and John Klingner via Wirepoints.org,

“When you think of a place like Chicago, these kids, you’re more likely to get shot than you are to get a world-class education in some of these places.”

That was Florida Gov. Ron DeSantis’ comment about Chicago’s crime and failed education system late last month

Hyperbole, maybe, but not that far off if you only consider the city’s struggling black community.

Data from the Mayor’s Violence Reduction Dashboard shows there were 3,512 fatal and non-fatal shooting victims in 2022, nearly 20 percent of which were aged 19 and under.

With black Chicagoans, on average, making up over three quarters of all victims, that’s about 500 black youths shot in 2022.

How does that compare to the number of black Chicago Public School students getting a “world-class” education? 

We looked at the Illinois Report Card data for 2022 and found that only a dismal 0.4 percent of Chicago’s 110,000 black students exceeded the requirements for math – a proxy for “world-class” education. That’s just shy of 500 black students.

DeSantis basically nailed it.

The fact that his statement is even close to true shows just how badly Chicago’s leaders are failing the city’s children – not only through their failure to tamp down on violent crime but also through their inability to educate.

Tyler Durden
Tue, 06/06/2023 – 17:25

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Like, Totally Orwellian: Nearly A Third Of GenZ Favors ‘Government Surveillance Cameras In Every Household’

Like, Totally Orwellian: Nearly A Third Of GenZ Favors ‘Government Surveillance Cameras In Every Household’

Nearly one-third of Generation Z says they’d be just fine with government-installed surveillance cameras in every household under the guise of reducing domestic violence and other illegal activity.

“Would you favor or oppose the government installing surveillance cameras in every household to reduce domestic violence, abuse, and other illegal activity?” asks a new survey from the Cato Institute. Of the responses, 29% of those aged 18-29 said yes.

As the NY Post notes;

In 1791, the utilitarian philosopher Jeremy Bentham proposed building a “panopticon” in which people’s behavior could be monitored at all times.

But Bentham’s panopticon was meant to be a prison. A sizable segment of Generation Z would like to call it home.

When it comes to other age brackets, 20% of millennials (between the ages of 30 and 44) also want everyone watched.

Then, wisdom appears to kick in – as just 6% of Americans aged 45 and older were OK with government surveillance in every home.

Broken down by politics, 19% of liberals and 18% of centrists agreed that our daily lives should be monitored by the government for our own safety, while 9 – 11% of those who identify as conservative, very conservative, or very liberal agreed in what appears to be a “horseshoe” issue that unites both ends of the political spectrum.

It’s the middle that has the ethic of old East German secret police — or the KGB.

Maybe that’s not surprising considering the way respectable liberal institutions now run themselves.

From Ivy League campuses to the publishing industry and the digital domains of Facebook, there is an Orwellian sense of perpetual emergency, an irrational fear that misinformation and hate speech will overwhelm society unless every utterance is subject to a censor’s scrutiny.

Even Orwell didn’t imagine Newspeak would require new pronouns. -NY Post

Broken down by race, 33% of black Americans said they’re fine with government in-home surveillance, as did 25% of hispanics, 11% of whites, and 9% of asians respectively.

The question was asked as part of the Cato Institute’s survey on American attitudes on the prospect of a ‘central bank digital currency.’ What’s interesting about that is that 53% of Americans who support a CBDC also support in-home surveillance cameras.

Notably, Americans who support a CBDC stood out in how they think about in‐​home government surveillance cameras. A majority (53%) of Americans who support a CBDC support the government installing in‐​home surveillance cameras to reduce abuse and other illegal activity. This suggests that some of the psychology behind support for a CBDC springs from an above average comfort level with trading some personal autonomy and privacy for societal order and security. -Cato Institute

What’s more, those who view the Federal Reserve favorably are more likely to support a CBDC (duh).

Sheep gonna sheep?

Tyler Durden
Tue, 06/06/2023 – 17:05

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Women-Only Naked Spa Lacks Constitutional Right to Exclude Transgender Patrons with Pensises

From Judge Barbara Jacobs Rothstein’s opinion yesterday in Olympus Spa v. Armstrong (W.D. Wash.):

The Olympus Spa is a Korean spa “specifically designed for women,” and the services offered there “are closely tied to the Korean tradition,” meaning patrons are “require[d] … to be naked” during certain services. The facilities include “a bath area containing multiple whirl-pools, a traditional Korean body-scrub service area, standing showers, sit-down showers, a steam room, and a dry sauna.” As noted, patrons are “typically fully naked” while utilizing these areas and thus “have visual access” to other nude patrons. Nor is nudity optional. It is allegedly “required for certain procedures called ‘Seshin'” pursuant to Korean tradition. According to Plaintiffs, female patrons receiving a Korean body scrub “must do so unclothed,” and all employees who provide those scrubs (“ddemiri”) are women.

Olympus Spa maintains a “female-only policy” under which it restricts admission to women—or, more specifically, individuals who “physically present[ ] in the nude as … female.” It apparently advertised this entry policy on its website with the following language: “Biological women are welcome[.] It is the policy of Olympus Spa not to discriminate on the basis of race, color, national original, sex, age, or disability in its programs or activities, as required by applicable laws and regulations.” Olympus Spa thus admits transgender women only if they have “gone through post-operative sex confirmation surgery.” Plaintiffs attribute the policy to their “traditional, theologically conservative” Christian values. They believe in “modesty as between the sexes” and “hold the conviction that a male and female should not ordinarily be in each other’s presence while in the nude unless married to each other.” See also Dkt. No. 1-2 at 4 (“Women are in a vulnerable position when they are unclothed and/or having treatment while unclothed and we seek to ensure that they feel their privacy and rights are respected. This is a biblical principle from 1 Peter 3:7, 1 Timothy 3:1-7, 1 Timothy 5:2, Phillipians 4:3, Genesis 1:27, Proverbs 31:17, Phillipians 2:3 and more.”). The Jane Doe Employees accordingly refuse to perform massages or body scrubs on naked men. And Jane Doe Patron, a Christian “who frequently receives treatments at Olympus Spa,” likewise “believes that men and women should not be viewing each other’s naked bodies unless married to each other.” …

The Washington State Human Rights Commission concluded that the spa’s policy violated Washington’s ban on gender identity discrimination in public accommodations, and the court held that this didn’t violate the Free Exercise Clause, Free Speech Clause, or the right of intimate association:

As for their [Free Exercise Clause] claim, Plaintiffs observe that they “have the liberty to not only believe as they do about males and females in a state of undress, but they also have the right to freely exercise their religious rights, i.e., to act in accordance with their faith-based convictions.” Plaintiffs allege that the Commission’s enforcement of the WLAD against them, “which requires them to service nude males and females in the same rooms,” forces them “to choose between violating the law or their religious convictions.” This, according to Plaintiffs, imposes a substantial burden on the exercise of their religious beliefs. The Commission counters that the WLAD is a neutral law of general applicability and therefore does not run afoul of the First Amendment. The Court agrees with the Commission and dismisses this claim … .

Plaintiffs fail to plead—let alone plausibly—that the WLAD is anything but neutral. The law does not discriminate on its face, and it does not by its terms favor a particular religion or the non-exercise of religion. Nor have Plaintiffs alleged facts to suggest that the legislature was motivated by a masked intent to discourage religious exercise or discriminate against their religion. Plaintiffs have also not alleged that the Commission’s application of the WLAD in this case was motivated by any “clear and impermissible hostility toward the sincere religious beliefs that motivated [their] objection,” and the Court is unable to discern any facts in the record that would support such a claim … .

Plaintiffs attempt to raise a “hybrid rights” claim. In Smith, the Supreme Court excepted from rational basis review “hybrid situation[s]”—those cases that involve “not the Free Exercise Clause alone, but the Free Exercise Clause in conjunction with other constitutional protections, such as freedom of speech and of the press[.]”Plaintiffs accordingly wish to tether their free exercise claim to “either or both” of their remaining claims in the hopes that the Court will apply strict scrutiny to the WLAD. See San Jose Christian Coll. v. City of Morgan Hill (9th Cir. 2004) (“If … a law burdens the free exercise of religion and some other constitutionally-protected activity, there is a First Amendment violation unless the strict scrutiny test is satisfied[.]”). But a hybrid rights claim requires more than a bald allegation that a companion right is implicated or has been violated. “[T]o assert a hybrid-rights claim, a free exercise plaintiff must make out a colorable claim that a companion right has been violated—that is, a fair probability or a likelihood, but not a certitude, of success on the merits.” Put differently, a hybrid rights claim is not entitled to strict scrutiny analysis merely because it “combine[s] a free exercise claim with an utterly meritless claim of the violation of another alleged fundamental right[.]”For the reasons discussed below, Plaintiffs fail to allege a plausible free speech or free association violation. Neither of those claims, then, combines with their free exercise claim to create a viable hybrid rights claim. The Court dismisses Plaintiffs’ free exercise claim.

Note that the Washington Constitution’s religious freedom provision—unlike the Free Exercise Clause—has been read as presumptively mandating religious exemptions even from generally applicable laws, but the plaintiff didn’t bring that claim in this case, perhaps because plaintiffs seek an injunction, and federal courts generally can’t order state officials to follow state law.

The court also rejected the free speech claim:

Plaintiffs contend that the Commission required Olympus Spa to “remove language from its website that has a viewpoint that ‘biological women’ are females and distinct from males.” …

The law at issue here, however, is not a content-based speech restriction. The Commission correctly observes that the WLAD does not target speech—indeed, it says nothing at all about speech and does not purport to outlaw a particular idea, topic, message, or viewpoint. The WLAD instead regulates discriminatory conduct. It “imposes a flat ban” on discrimination in places of public accommodation—”one that is applied without regard to [the] content” of a business’s message. And as the Supreme Court has repeatedly observed, “[a] regulation that serves purposes unrelated to the content of expression is deemed neutral, even if it has an incidental effect on some speakers or messages but not others.”

The compelled speech to which Olympus Spa points is “plainly incidental” to the WLAD’s regulation of discriminatory conduct. The WLAD bars Olympus Spa from denying services to customers based on sexual orientation and, in this regard, it incidentally burdens Olympus Spa’s speech by prohibiting advertisement of discriminatory entrance policies (e.g., one that permits only “biological women”). But that does not convert the WLAD into a content-based regulation. To borrow an analogous example from the Supreme Court, “Congress … can prohibit employers from discriminating in hiring on the basis of race,” and “that this will require an employer to take down a sign reading ‘White Applicants Only’ hardly means that the law should be analyzed as one regulating the employer’s speech rather than conduct.” Rumsfeld v. FAIR … .

And the court rejected the freedom of association claim:

In their final claim, Plaintiffs allege that enforcement of the WLAD against them “would require females … to remain in the presence of naked males” and therefore violates their “freedom protected by the Bill of Rights to selectively enter into and carry on intimate or private relationships—or refrain from such relationships.” … “To be exposed to the shocking and jarring visual of a penis while naked and to be viewed by someone who could become turgid due to viewing the female form would be an extreme offense and violative of the right to feel secure in one’s person and association.” …

The Supreme Court distinguishes between two constitutionally protected freedoms of association: the “freedom of intimate association” and the “freedom of expressive association.” The former involves the right “to enter into and maintain certain intimate human relationships”—relationships which “must be secured against undue intrusion by the State because of the role of such relationships in safeguarding the individual freedom that is central to our constitutional scheme.” The freedom of intimate association “receives protection as a fundamental element of personal liberty.” On the other hand, the freedom of expressive association refers to the “right to associate for the purpose of engaging in those activities protected by the First Amendment—speech, assembly, petition for the redress of grievances, and the exercise of religion.” It is viewed “as an indispensable means of preserving other individual liberties.”

Plaintiffs raise an intimate association claim. Although the “precise boundaries of this type of constitutional protection” remain unmarked, the intimate relationships that have qualified for the protection include “marriage; the begetting and bearing of children; child rearing and education; and cohabitation with relatives.” This is not to suggest that intimate association is restricted to family matters. Rather, qualifying relationships “are distinguished by such attributes as relative smallness, a high degree of selectivity in decisions to begin and maintain the affiliation, and seclusion from others in critical aspects of the relationship.” The Court must conduct a “careful assessment” of the relationship’s characteristics to locate where it falls on a spectrum “from the most intimate to the most attenuated of personal attachments.”

The relationship between Olympus Spa and its customers clearly falls “outside of the category of relationships worthy of this kind of constitutional protection.” It is a business—not a private club with an exclusive membership. As such, Olympus Spa is open to the public and provides services to countless (female) strangers on a daily basis. The Supreme Court has for these reasons observed that “a large business enterprise” is the type of association that “seems remote from the concerns giving rise to th[e] constitutional protection.” Although Olympus Spa may not constitute a large enterprise, the analogy is still apposite: spa-goers “are not members of any organized association; they are patrons of the same business establishment. Most are strangers to one another, and the [spa] admits all [biological females] who are willing to pay[.]”

Plaintiffs emphasize Olympus Spa’s female-only exclusivity and female-oriented purpose. They likewise suggest that the business is sufficiently personal and private to warrant constitutional protection because “the state of being unclothed requires the most intimate of settings[.]”But this again elides a basic, controlling fact: Olympus Spa is a business that provides services to the public. And as was the case in Jaycees, Olympus Spa does not—”[a]part from … sex”—employ any criteria for judging patrons, who are routinely “admitted with no inquiry into their backgrounds.” …

The Court does not minimize the privacy concerns at play when employees are performing exfoliating massages on nude patrons. Aside from this nudity, though, there is simply nothing private about the relationship between Olympus Spa, its employees, and the random strangers who walk in the door seeking a massage. Nor is there anything selective about the association at issue beyond Olympus Spa’s “biological women” policy. The Court therefore has little difficulty concluding that the personal attachments implicated here are too attenuated to qualify for constitutional protection. Plaintiffs’ intimate association claim is dismissed.

The post Women-Only Naked Spa Lacks Constitutional Right to Exclude Transgender Patrons with Pensises appeared first on Reason.com.

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The Student Loan Pause Has Made Borrowers Worse Off


Headshot of President Joe Biden overlaid on a green background with orange money seals

The over three-year-long moratorium on federal student-loan repayment has long been hailed as a godsend for student loan borrowers. While announcing yet another extension of the moratorium in December 2021, President Biden praised it as “badly needed breathing room during the economic upheaval caused by the global COVID-19 pandemic.”

However, a new working paper from the National Bureau of Economic Research indicates that borrowers whose loans were frozen by the moratorium actually ended up in a worse position than they started inand have even accrued more student loan debt.

In March 2020, the Trump administration announced a moratorium on federal student loan payments for 60 days, citing the financial hardship faced by borrowers in the early days of the pandemic. In the three years since, the pause has been extended eight times with a variety of legal justifications. Payments are still currently paused, though the recently signed debt ceiling bill sets a hard expiration date for the moratorium on August 30.

The total cost of the pause is estimated to be as high as $5 billion per month, or almost $200 billion by the time repayment starts in September. And all that spending might not have even helped those whom the moratorium was supposed to benefit. According to the paper, those whose loans were frozen by the moratorium actually took on more debtborrowing more on credit cards and mortgages and even accruing more student loan debt rather than working to pay off other debt they owe. 

The paper compared those whose student loans were frozen by the moratorium because their loans were held federally to those whose student loans were not frozen because their loans were private. There were stark differences between the two groups. For those whose loan payments were paused, they did reap some benefits, like increased credit scores and a decrease in delinquency on student loan debt. However, by other metrics, they actually became worse off. By the end of 2021, borrowers who saw their student loan payments paused increased their credit card, mortgage, and car-loan debt by $1,800 on average and even took on an additional $1,500 in student loan debt compared to those whose loan payments were not paused by the moratorium. Rather than being the “badly needed breathing room” that Biden suggested, the student loan payment pause has actually resulted in borrowers ending up financially worse off than they were before.

“Perhaps paradoxically, temporary student debt relief leads to higher overall household debt levels and larger future debt burdens,” the paper reads. “The results indicate that debt payment pauses can increase consumption in the short term, but that overall debt increases, as borrowers use increased liquidity to service new debt.”

Not only did the student loan payment pause cost taxpayers billions, but it also didn’t even help decrease the debt owed by those whom the pause was supposed to benefit. Like many expensive government interventions, the student loan moratorium made everyoneincluding those the program was meant to helpworse off. 

The post The Student Loan Pause Has Made Borrowers Worse Off appeared first on Reason.com.

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Netanyahu Threatens Iran, Slams IAEA Amid Major War Drills

Netanyahu Threatens Iran, Slams IAEA Amid Major War Drills

Authored by Connor Freeman via The Libertarian Institute,

Israeli Prime Minister Benjamin Netanyahu ramped up his threats of war against Iran and slammed the International Atomic Energy Agency (IAEA), the UN nuclear watchdog, for cooperating with Tehran on Sunday.

Netanyahu’s warning was included as part of a video statement recorded from Tel Aviv’s underground command bunker – at Israel’s military headquarters – where a rare cabinet war drill was convened. The Israeli leader reemphasized his willingness to launch a preemptive war, including bombing the country’s nuclear facilities, if international diplomacy fails with Iran.

“We are committed to acting against Iran’s nuclear [drive], against missile attacks on Israel and the possibility of these fronts joining up,” Netanyahu said. The stepped-up threats come as Israel is carrying out a two-week series of military exercises dubbed “Firm Hand.” The drills are eyeing a war on multiple fronts with Lebanese Hezbollah, Syria, as well as Iran, simulating “multi-arena combat” across the “air, sea, land, electromagnetic spectrum, and in the cyber arena.”

Since taking power last December, the current regime in Israel has waged a brutal bombing campaign in the Gaza Strip which has killed 33 people, doubled the number of air raids in Syria, conducted strikes in Lebanon, as well as drone attacks in Iran. Additionally, Israeli forces and settlers have killed at least 119 Palestinians in the West Bank and East Jerusalem so far this year.

While flanked by his security cabinet ministers and defense chiefs, Netanyahu warned that the possibility of a multi-front war means Israeli leadership must “consider, if possible consider ahead of time,” major decisions.

Earlier, Netanyahu also took aim at the IAEA, after the Vienna-based org reportedly resolved some outstanding inquiries with the Islamic Republic over its nuclear energy program. The concerns put to rest pertained to one of three so-called “undeclared” nuclear sites, where trace particles of unprocessed uranium had been found previously, as well as some recently discovered highly enriched uranium particles.

Netanyahu blasted the IAEA’s success with Tehran, including re-installing some monitoring equipment originally put in place under the the Joint Comprehensive Plan of Action (JCPOA), the Iran nuclear deal which the US illegally exited. The Israeli leader declared “Iran is continuing to lie to the International Atomic Energy Agency,” insisting the “agency’s capitulation to Iranian pressure is a black stain on its record.”

Without providing evidence to support his claims, Netanyahu said Iran’s explanations are “technically impossible,” and that the agency is politicizing the issue and endangering its own credibility. However, coming under pressure from the US and Israel in recent years, the watchdog group has been increasingly politicized against Tehran.

The issue of the unprocessed uranium traces found at what have long been dubbed the “undeclared sites,” an allegation which originated in Israel, is highly controversial. This is because the the trace particles themselves never posed any proliferation risk, but the allegation has long been used by Washington and Tel Aviv to thwart diplomatic progress on saving the JCPOA. Iran provided the IAEA with full documentation on these inquiries last year and allowed inspectors to access to the sites as well. Only now is the Islamic Republic’s cooperation being officially recognized, something which the White House had actively opposed.

Entrance to Israel’s government bunker in 2018. Image via CTech

For their part, the Israelis have railed against the JCPOA, hailed the US “maximum pressure” sanctions campaign, and called for a credible military threat against Iran. If Israel was truly concerned about Iran’s alleged pursuit of nuclear weapons, Netanyahu would support the JCPOA, which mandates the most comprehensive international inspections regime ever implemented.

In any case, both the Pentagon and the CIA have repeatedly denied Israel’s accusations that Iran is seeking a nuclear bomb and the country has been a signatory of the Non-Proliferation Treaty (NPT) for more than 50 years. Israel has never signed the NPT due to its open-secret nuclear arsenal thought to contain hundreds of warheads – technically making decades of American aid to Tel Aviv illegal under US foreign assistance laws.

Tyler Durden
Tue, 06/06/2023 – 16:45

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