Author: Matthew G. Saroff

One of the worst of the anti-terror laws, adopted under Clinton, not Bush II, is the “material support law,” which makes it a crime to provide “material support” to any organization that is deemed a “terrorist organization” by the President (actually the Secretary of State).

The cases, Holder v. Humanitarian Law Project (08-1498) and Humanitarian Law Project v. Holder, are about what is a legitimate use of the law.

The case here is interesting because it appears that the law is criminalizing purely political speech:

CCR contends that the challenged provisions violate the First Amendment insofar as they criminalize the provision of forms of support such as the distribution of literature, engaging in political advocacy, participating in peace conferences, training in human rights advocacy, and donating cash and humanitarian assistance, even when such support is intended solely to promote the lawful and non-violent activities of a designated organization. Plaintiffs’ principal complaint is that the statute imposes guilt by association by punishing moral innocents not for their own culpable acts, but for the culpable acts of the groups they have supported. The statute does not require any showing of intent to further terrorist or other illegal activity. We also claimed that the statute was unconstitutionally vague, and that the Secretary of State’s power to designate groups was too broad, giving the executive too much discretionary power to label groups as “terrorist” and turn their supporters into outlaws.

As I see it, if a group sees the designation of another group as a “terrorist entity” as in error, the way that the current law is written, or at least enforced, actually publicly advocating for a change in that designation would be offering “material support.”

In this case, the Human Rights Project wants to train the PKK, the Kurdish Workers Party, designated a terrorist group, in, “human rights enforcement and peaceful conflict resolution,” but the material support law forbids this.

So this law is preventing the provision of training in how not to be a terrorist.

As with most of the anti-terror laws out there, it invokes Joseph Heller’s most famous work.

A good description of the oral arguments is here.

23 February 2010, 11:01 PM

Monopolies Are Strangling Our Economy

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Graphic Courtesy of the WaPo

In Washington Monthly, Barry C. Lynn and Phillip Longman argue that the increase in jobless recovery and stagnation is an artifact of the increasingly monopolistic marketplace that we encounter:

If any single number captures the state of the American economy over the last decade, it is zero. That was the net gain in jobs between 1999 and 2009—nada, nil, zip. By painful contrast, from the 1940s through the 1990s, recessions came and went, but no decade ended without at least a 20 percent increase in the number of jobs.

…………

But while the mystery of what killed the great American jobs machine has yielded no shortage of debatable answers, one of the more compelling potential explanations has been conspicuously absent from the national conversation: monopolization. The word itself feels anachronistic, a relic from the age of the Rockefellers and Carnegies. But the fact that the term has faded from our daily discourse doesn’t mean the thing itself has vanished—in fact, the opposite is true. In nearly every sector of our economy, far fewer firms control far greater shares of their markets than they did a generation ago.

Indeed, in the years after officials in the Reagan administration radically altered how our government enforces our antimonopoly laws, the American economy underwent a truly revolutionary restructuring. Four great waves of mergers and acquisitions—in the mid-1980s, early ’90s, late ’90s, and between 2003 and 2007—transformed America’s industrial landscape at least as much as globalization. Over the same two decades, meanwhile, the spread of mega-retailers like Wal-Mart and Home Depot and agricultural behemoths like Smithfield and Tyson’s resulted in a more piecemeal approach to consolidation, through the destruction or displacement of countless independent family-owned businesses.

It is now widely accepted among scholars that small businesses are responsible for most of the net job creation in the United States. It is also widely agreed that small businesses tend to be more inventive, producing more patents per employee, for example, than do larger firms. Less well established is what role concentration plays in suppressing new business formation and the expansion of existing businesses, along with the jobs and innovation that go with such growth. Evidence is growing, however, that the radical, wide-ranging consolidation of recent years has reduced job creation at both big and small firms simultaneously. At one extreme, ever more dominant Goliaths increasingly lack any real incentive to create new jobs; after all, many can increase their earnings merely by using their power to charge customers more or pay suppliers less. At the other extreme, the people who run our small enterprises enjoy fewer opportunities than in the past to grow their businesses. The Goliaths of today are so big and so adept at protecting their turf that they leave few niches open to exploit.

One of the points that I have made when I discuss the role of the large monopoly Telcos and how this effects the availability and price of broadband is that when a company gets large enough, it’s more profitable to keep out competitors than it is to improve the quality and efficiency of its process.

If one understands the nature of any corporation, which is that they are short-sighted sociopaths by design, this makes perfect sense: You can spend billions on innovation, or millions on locking out and/or buying up competitors.

Even Sci-Fi author Jerry Pournelle, who describes himself as being somewhere to the right of Attila the Hun, says that for the free market to function, aggressive anti-trust activities are essential. (No link, it was from his “Chaos Manor” column in Byte about 20 years ago)

Provision	Obama’s Bill	House Bill	Senate Bill
Affordability	Improves the Senate bill’s subsidies for lower income Americans. Families below $44,000 and above $66,000 would pay less in premiums. Also raises the percent of health costs that are paid by insurers from the Senate proposal.	Families earning below $55,000 would still receive more subsidies under the House bill, but Americans earning more than $55,000 would pay higher premiums (as compared to Obama’s proposal). The percent of costs paid by the insurers is higher than Obama’s proposal.	Families making under $55,000 would see higher premiums than Obama’s proposal and the percent of costs paid for by health insurers is lower than Obama’s proposal.
Excise Tax	‘Labor agreement’ for everyone. Changes effective date of the Senate policy from 2013 to 2018. Raises the amount of premiums that are exempt from the assessment from $8,500 for singles to $10,200 and from $23,000 for families to $27,500 and indexes these amounts for subsequent years at general inflation plus 1 percent.	No excise tax.	40% excise tax beginning in 2013 on individual polices worth $8,500 or higher and family policies starting at $23,000.
Payroll Tax	Adopts Senate bill approach and adds a 2.9% assessment on unearned income.	5.4% surcharge on high-income households.	Payroll tax increase of 0.9% on earnings above a specific threshold for a total employee assessment of 2.35% on these amounts.
Individual Mandate	Mixed bag. May be easier for younger Americans to opt out. Lowers flat dollar amount to $695 by 2016 from the Senate bill and raises the alternative percent of income to House levels that individuals will pay for not having health insurance. Hardship waiver when premiums over 8% of their income, and couples under $18,700 are exempt from the requirement.	2.5% of income by 2016 with a limit of the average national health premium.	Flat rate of $750 by 2016 and hardship waiver when premiums exceed 8% of income.
Employer Mandate	No mandate, free rider provision. Large employers (50+ workers) have to pay a fee if employees receive subsidies. Improves transition to free-rider policy by subtracting first 30 workers. (A firm with 51 workers that does not offer coverage will pay an amount equal to 51 minus 30, or 21 times the applicable per employee payment amount.)	Employer mandate. The House bill requires a payroll tax for employers that do not offer health insurance that meets minimum standards.	No mandate, free rider provision. Large employers have to pay a fee if taxpayers are supporting the health insurance for their workers.
Grandfathered plans	*Plans have to conform to new regulations.* Plans have cover adult dependents up to 26yo, prohibits rescission. After exchanges begin in 2014, plans can’t institute annual and lifetime limits or pre-existing condition exclusions. Beginning in 2018, the President’s Proposal requires “grandfathered” plans to cover proven preventive services with no cost sharing.	“Grandfather” policy that allows people who like their current coverage, to keep it. Abide by all rules after 5 years.	“Grandfather” policy that allows people who like their current coverage, to keep it.
Medicare Donut Hole	*Completely closes donut hole.* Replaces $500 increase threshold increase limit with a $250 rebate to Medicare beneficiaries who hit the donut hole in 2010. Closes donut hole by phasing down the coinsurance so it is the standard 25% by 2020 throughout the coverage gap.	The House bill fully phases out the donut hole over 10 years. Raise the dollar amount before the donut hole begins by $500 in 2010.	The Senate bill provides a 50% discount for certain drugs in the donut hole. Raise the dollar amount before the donut hole begins by $500 in 2010.