There are frequent complaints that U.S. income inequality has increased in recent decades. Estimates of rising inequality that are widely cited in the media are often based on federal income tax return data. Those data appear to show that the share of U.S. income going to the top 1 percent has increased substantially since the 1970s. A new study by Cato scholar Alan Reynolds shows that these claims are wrong in both their premises and their conclusions. In “Has U.S. Income Inequality Really Increased?,” Reynolds concludes, “There is no clear evidence of a significant and sustained increase in the inequality of U.S. incomes, wages, consumption, or wealth since the late 1980s.” Cato will also host an event on income inequality on January 11.

Cato’s Center for Trade Policy Studies is putting together its ideas for a sensible farm policy (the current farm bill comes up for renewal later this year). Needless to say, the Cato plan will look substantially different from the anachronistic, interventionist pork-fest that was the 2002 Farm Bill.

In the meantime, those interested in U.S. farm policy might like to check out the following links: today’s editorial in the Washington Post and an article by Jonathan Rauch in Friday’s National Journal. Both contain plenty of arguments for what is wrong with U.S. agricultural policy today and are best read on an empty stomach. For a good overview of the farm bill debate, this article by Catherine Richert (Congressional Quarterly) is a pretty good bet.

One can’t swing a dead cat in Washington these days without hitting someone who’s ranting about how plug-in hybrid vehicles (part gasoline engine, part battery-powered engine, but rechargeable like a wall appliance) are the wave of the future. Of course, if they really were the wave of the future, there would be no need for ranting in Washington — automobile manufacturers would be busy making them as we speak. It’s only when corporate America is cool to an idea that the prophets turn to the taxpayer or the regulator. This illustrates Taylor’s law — “the commercial merit of any particular technology is inversely related to the degree of political tub-thumping heard in Washington for said technology.”

Which brings us to plug-in hybrids. Noted automobile engineers James Woolsey, Frank Gaffney, and Gal Luft, among others, have been going into overdrive of late to demand federal action to compel the manufacture and sale of these sorts of cars, which they assure us perform so splendidly and can be so wildly profitable for both buyer and seller that only some sort of inexplicable insanity explains their absence from car lots all across America. This “Neo-Cons for Neo-Cars” alliance is picking up steam and is increasingly embraced by all sorts of smart opinion leaders who can barely program a VCR, much less design an engine.

An invaluable reality check, however, can be found in the Sunday New York Times. There, reporter Lindsay Brooke notes that, while automobile companies are busily developing plug-in prototypes, there remains one little problem — the battery necessary to make such a car go from here to there has yet to be invented. While the industry is optimistic that something will come along in the near future, industry executives confess when pressed that the cars would be so expensive to manufacture that they probably wouldn’t sell without government subsidies or consumption mandates.

Why are Neo-cons and other assorted hawks so obsessed with automotive powertrains? My guess is that they fear U.S. foreign policy is being terribly constrained by our need to import oil. Plug-in hybrids would liberate the country from worrying about how our actions play on the Arab street, freeing Uncle Sam to act even more uninhibitedly around thew world.

Look, if the auto industry wants to make these things and consumers want to buy them, fine with me. But before we start bossing Detroit or their customers around and turn over automobile manufacturing to the very same crowd that manufactured the war in Iraq, consider yourself warned. 

Any scan of the business pages will reveal anecdotally that foreign-born scientists, engineers, and entrepreneurs are playing an important role in our high-technology economy. A Duke University study released yesterday on “America’s New Immigrant Entrepreneurs” confirms that fact.

Conducted by a team of researchers at Duke’s Pratt School of Engineering, the study surveyed thousands of U.S. high-tech companies and examined a decade of patent records. The study found that:

• One-quarter of all engineering and technology companies launched between 1995 and 2005 had at least one key founder who was foreign-born. Those companies with at least one immigrant co-founder produced $52 billion in sales and employed 450,000 workers in 2005.
• India was the most common home country among the foreign-born entrepreneurs, followed by the United Kingdom, China, Taiwan, and Japan. Most of the immigrant-founded companies were in the software and innovation/​manufacturing services sectors. 
• Foreign nationals living in the United States were listed as inventors or co-inventors on almost a quarter of the patents filed from the United States in 2005.

Many members of Congress worry that the United States may be losing its edge in high technology industries. Yet the same Congress maintains a cap of 65,000 on H1‑B visas that allow highly skilled immigrants to live and work in the United States, a cap that falls far below the actual needs of our nation’s resurgent high-tech sector.

The Duke study shows clearly why Congress should raise the cap — unless congressional leaders believe America already has too many high-tech companies and patents too many new inventions. 

Oprah Winfrey has plunked down $40 million on a private school in South Africa to offer poor kids there a better education than can be had in their local government schools. When asked why she was investing in students from South Africa rather than, say, South Chicago, Oprah shot back that:

I became so frustrated with visiting inner-city [U.S.] schools that I just stopped going.… The sense that you need to learn just isn’t there. If you ask the kids what they want or need, they will say an iPod or some sneakers. In South Africa, they don’t ask for money or toys. They ask for uniforms so they can go to school.

Clearly, Oprah has not been visiting the Milwaukee private schools serving low income black and Hispanic students. Having done so recently myself, I can report first hand that those students are so ambitious, motivated, curious, and hungry for learning that they bring joy to the hardest heart and water to the driest eye.

The modern belief that poor urban kids don’t want to learn completely misunderstands the problem. It isn’t the kids. It’s the schools.

Visit independent, parent-chosen schools in America’s inner cities and you will seldom find the disaffection Oprah has apparently seen so often in (presumably) government-run schools. 

And when I say the it’s the schools, what I really mean is: “it’s us.” It’s our fault. If we would only realize that the ideals of public education can best be advanced by a system of universal parental choice, rather than a centrally planned government factory system, we’d see a lot more engaged, energized kids who not only want to go on to college and successful jobs and lives, but who have the educational foundation to do it.

I’ve collected some of the evidence on this point here, for those unfamiliar with it.

“We’ve done a better job of holding the line on domestic spending.…By continuing these policies, we can balance the federal budget by 2012.”

–President Bush in the Wall Street Journal, January 3, 2007

The New York Daily News is reporting that the Bush administration has asserted the legal authority to search and inspect the mail without having to get search warrants. 

There is an “emergency” exception to the warrant requirement. For example, if some bank robbers decide to take hostages and start making demands, a SWAT team can move in without a warrant. When the emergency exception is ordinarily relied upon, the search is done out in the open — so the government’s actions are transparent. The homeowner or business owner knows fairly quickly that agents conducted a search and can bring any abuse to the attention of the news media, the courts, or the legislature. Those “checks” on police power are not in place with respect to mail openings. We just don’t know what may be going on at the post office before we get our mail.

Rep. Jeff Flake (R‑AZ) specifically asked Attorney General Alberto Gonzales about mail openings at a 2005 hearing. Here’s the exchange:

REP. JEFF FLAKE (R‑AZ): Thank you, Mr. Chairman. Thank you, General Gonzales.

Let me just try to bring this to the real world for a minute here, the real-world scenario, and see if we’re on the same page here. You may be familiar with one of the Fox News analysts, Andrew Napolitano, who wrote an op-ed a while ago. And let me just read a portion of it and get your response to it.

Quote: “The government can now, for the first time in American history, without obtaining the approval of a court, read a person’s mail and prosecute a person on the basis of what is in the mail.” Is that an accurate reflection of the law?

ATTY GEN. GONZALES: I’m not — I don’t believe it is an accurate reflection of the law. Again, if we’re talking about the exercise of authorities under the Patriot Act, in most cases it does involve the department going to a federal judge and getting permission to use a proposed authority.

REP. FLAKE: I understand in most cases. But is that possible now, for the first time in history, without obtaining the approval of a court, to read a person’s mail and then prosecute the person on the basis of what is in that mail?

ATTY GEN. GONZALES: That sounds to me like it would be a search. And I think that you would need probable cause to do that. You would need a warrant to do that, and you’d have to go to a federal judge in those cases, except, I think, in very rare circumstances, if in the event of an emergency. But even then you’d have to go to a judge after the fact and explain what you’ve done. So I don’t think that what he has said is accurate.

REP. FLAKE: But it would be accurate if you say in certain cases you would have to go to the judge after the fact.

ATTY GEN. GONZALES: But those are very rare and extraordinary circumstances. And so —

REP. FLAKE: How many of those circumstances have we had?

ATTY GEN. GONZALES: I’m not aware of any.

REP. FLAKE: None?

ATTY GEN. GONZALES: I’m not aware of any.

REP. FLAKE: If there are some, could you get back to my office with that information?

ATTY GEN. GONZALES: I can certainly look into it.

Source: Hearing before the House Judiciary Committee, April 6, 2005.

I will be blogging about this some more later, but I expect the Senate and House Judiciary Committees will immediately begin to investigate this matter and call Mr. Gonzales in for questioning.

For background on the constitutional record of the Bush administration, read this.