Cato Daily Dispatch for December 16, 2004
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Missile Defense Test FailsFCC Won't Regulate Stern's Satellite Show
SEC Orders Fannie Mae to Correct Accounting
Missile Defense Test Fails
"An experimental interceptor missile failed to get off the ground in a test of the U.S. national missile defense system early Wednesday, raising new doubts about prospects for the imminent activation of the system," the Associated Press reports.
In "Missile Defense: Defending America or Building Empire?" Charles V. Peņa, Cato director of defense policy studies, argues for a limited, land-based missile defense system. "The administration's vision of missile defense is not just a global system that protects the United States against long-range missiles but a global system capable of engaging all classes of ballistic missiles to protect U.S. forces deployed worldwide, U.S. allies, and other friendly countries," Peņa writes. "Thus, the purpose of missile defense is extended well beyond protecting America and Americans.
"... A better alternative -- especially given the post-September 11, 2001, realities of the al-Qaeda terrorist threat -- is for the United States to adopt a more restrained foreign policy. A more prudent security strategy would recognize that U.S. security would be better served by not engaging in unnecessary military deployments and interventions that fuel the flames of vehement anti-American sentiment."
FCC Won't Regulate Stern's Satellite Show
"Howard Stern will be free to be indecent on satellite radio, the Federal Communications Commission effectively said Wednesday -- a decision that should also make cable- and satellite-TV providers breathe easier, at least for now," according to Broadcasting & Cable.
In "Howard Stern and the Future of Media Censorship," Adam Thierer, Cato Institute director of telecommunications studies, writes: "While the Senate failed by one vote to pass the amendment imposing traditional 'indecency' fines and regulation on cable and satellite networks, the fight is hardly over. Several members of Congress such as Rep. Joe Barton (R-Texas), have hinted that they will continue to push for traditional broadcast regulation to be imposed on new, subscriber-based media outlets. If Congress or the FCC try to impose traditional content regulations on Stern -- or anyone else operating in the new media space (cable, satellite or the Internet) -- it will force the constitutional question of whether government can and should censor the media in the future.
"Whether Howard knows it or not, he may be ushering in a revolution in censorship policy and First Amendment law."
SEC Orders Fannie Mae to Correct Accounting
"The Securities and Exchange Commission's top accountant last night told mortgage funding giant Fannie Mae that it should correct its past accounting, a directive that could erase 38 percent of the profit the government-sponsored company has claimed since the beginning of 2001," the Washington Post reports. "Fannie said last month that if it was required to make such a correction, it might have to record $9 billion of previously unreported losses."
In "Fannie Mae, Freddie Mac, and Housing Finance: Why True Privatization Is Good Public Policy," New York University economist Lawrence J. White, a former Freddie Mac board member, argues in favor of the privatization of Fannie Mae and its sister corporation Freddie Mac.
"The special governmental links that apply to Fannie Mae and Freddie Mac yield little that is socially beneficial, while creating significant potential social costs," White argues. The best way to cut down on those costs and risks is privatization, he adds. "This would imply that the two companies would no longer enjoy any special privileges, but would no longer be restricted to their current narrow slice of the financial world. How these companies and their owners would fare in that scenario would then be a matter for markets, and not the Congress or [the Office of Federal Housing Enterprise Oversight], to decide."
Wyatt DuBois, editor, wdubois@cato.org