Bill Gates is addressing the Council of Chief State School Officers today. According to the NYT, he’ll tell them to bite the bullet and start making sound budgetary decisions like rewarding teachers based on merit instead of time served, and not handing out raises simply for the trappings of higher learning, but rather for demonstrated prowess in the classroom. In principle, that’s good advice.

But it’s an ultimately futile effort, and here’s why:

Bill established himself early on as a pretty sharp computer programmer, and no doubt he still is. But there’s only so much you can do when the hardware you’re writing for is a pile of junk. Public schooling is the Coleco Adam of education systems.

The Adam was a pretty cute looking machine for its time (1983), but it had some fundamental flaws. Among other things, turning the power on or off had a habit of sending out electromagnetic pulses that fried the data on its storage tapes. Oops. Now a good programmer might figure how to mitigate the damage caused by that problem (I dunno, treat the two tapes as a RAID 1 array, maybe?), but then the machine also had its power-supply located in the mandatory (and noisy, and slow) printer that came with it. So if the printer had to be serviced, you were left with a paperweight. Hard to fix that one in software.

It’s the same with public schooling. By its very design, it lacks the freedoms and incentives that relentlessly allow and pressure executives to make sound decisions in the free enterprise sector of the economy. Bill’s a sharp corporate executive as well as a sharp programmer. He’ll no doubt give the state superintendents of public instruction some reasonable advice. And ultimately it won’t matter.

If they make great decisions, these execs will at best get a pat on the back. If they make terrible ones, it likely won’t affect their compensation or careers much, because millions of families have little choice but to send their children to the official state-run schools. Given the state-run system’s monopoly on $13k / pupil of tax funding, it’s hard for most parents to pay for a better quality education for their kids.

This is a systemic problem. Without the necessary freedoms and incentives, good decisions made today will eventually be supplanted with worse ones in the future because public schooling has no built-in mechanism to consistently encourage the good over the bad.

Bill, it’s a hardware problem.

I don’t particularly relish picking on a president who, on virtually every policy front, is showing all the markings of a man in way over his head. But the president’s actions and statements are becoming excruciating to watch—like a highly-touted Olympic figure skater who can’t complete a maneuver without falling to the ice. 

President Obama’s salutary statement about GM’s IPO yesterday reveals a man so focused on defending his policies that he can no longer conceal the incongruity between his political objectives and the country’s imperatives.

American taxpayers are now positioned to recover more than my administration invested in GM, and that’s a good thing. (My emphasis)

Besides revealing the president’s preference for LIFO accounting procedures, the statement strikes me as sub-presidential. Shouldn’t the POTUS be concerned about American taxpayers getting back all of the money invested in GM? Even though former President Bush is complicit, shouldn’t the sitting president of a country that owes its wealth, freedom, and future to the endurance of the rule of law and the other long-standing, bedrock institutions that were defiled and abused to bail out two automakers issue a statement of regret and reassurance that such extreme measures will never be undertaken again? 

I think President Obama missed an opportunity to make amends, build a bridge, and reassure businesses and investors that the White House will do its part to reduce the economy-stifling problem of regime uncertainty going forward. But, then again, that might have been too presidential for a politician who appears motivated more by avoiding blame than by advancing the country’s best interests.

I wrote an op-ed for National Review (Online) last week showing how conservative exploitation of the Supreme Court’s broad misreading of the Commerce Clause to reach intrastate medical marijuana facilitated liberal exploitation of the same to create the individual mandate in Obamacare.

A principled stand on the limits of federal power does not begin and end with health care. The Commerce Clause is a double-edged sword: Conservatives cannot wield it in the drug war without making it a useful tool for advancing progressive visions of federal power.

I’m happy to see Barton Hinkle, winner of the 2008 Bastiat Prize for Journalism, pick up on my writing and drive the point home in today’s Richmond Times-Dispatch:

So far, many conservatives outraged over Obamacare do not seem to have reconsidered their enthusiasm for national drug prohibition. Whether they do so could provide a good indication as to whether they’re standing up for a principle — or merely against the president.

Hinkle points to a recent Heritage Foundation paper opposing Prop. 19, California’s referendum on marijuana legalization. The Commerce Clause makes a prominent appearance:

In 2006, the Supreme Court held in Gonzales vs. Raich that the Commerce Clause confers on Congress the authority to ban the use of marijuana, even when a state approves it for “medical purposes” and it is produced in small quantities for personal consumption. Many legal scholars criticize the Court’s extremely broad reading of the Commerce Clause as inconsistent with its original meaning, but the Court’s decision nonetheless stands.

Yes, the decision “nonetheless stands.” That doesn’t make it right. Several prominent conservative drug warriors signed on to an amicus brief in Raich endorsing an expansive use of the Commerce Clause. Copy, paste, and replace the word “marijuana” with “health insurance,” and you just wrote a Department of Justice brief for any of the suits defending Obamacare across the nation.

Or, for a good laugh, go read former Oklahoma congressman Ernest Istook, now working for Heritage, who frames the health care debate as “Obamacare vs. Limited Government.” As he puts it: “Straining to find a constitutional basis for mandating that everyone must buy health insurance, Obama’s lawyers resorted to the all-purpose Interstate Commerce Clause.” Istook signed on to the drug warrior brief in Raich.

There’s no good reason for this inconsistency. State attorneys general from both sides of the aisle opposed the federal intrusion in Raich. Deep red Alabama, Mississippi, and Louisiana touted their drug warrior prowess but argued against an overly broad Commerce Clause reading on federalism grounds. True blue California, Maryland, and Washington argued that the Controlled Substances Act did not bar states from regulating intrastate markets.

I make many of these points in a Cato Podcast, Conservatives, Obamacare, and the Commerce Clause. For some more Cato work on the drug war, check out how Portugal decriminalized drugs without the social ills that conservatives forecast, and how ending the war on drugs would save billions annually.

I wrote last week about my concerns regarding the fiscal conservatism of tea party candidates when it comes to farm programs. Edward Lotterman, writing in the (Minnesota) Pioneer Press Online, asks the key question:

If you campaign on a platform of lower taxes, smaller government, no budget deficits and ending government redistribution of income to small interest groups, how on Earth can you vote for continued spending on federal commodity programs?

Read the whole thing here.

You’ve probably heard that a jury found Al Qaeda bomber Ahmed Ghailani guilty on only one out of 286 charges associated with the 1998 embassy bombings in Kenya and Tanzania.

A predictable debate followed. Glenn Greenwald cited the outcome as proof that the system works, while Liz Cheney, Debra Burlingame and Bill Kristol described the trial as a reckless experiment. Thomas Joscelyn called the trial a miscarriage of justice.

The most insightful commentary I’ve seen is over at Lawfare. Benjamin Wittes and Robert Chesney summed things up pretty well: “Trial in federal court didn’t work out the way the Obama administration wanted, but it wasn’t a disaster–and we can’t honestly say it worked out worse than the military commission alternative would likely have done.”

I’ve disagreed with Wittes on lawfare issues before, but he and Chesney are right on this case: (1) the defendant will serve a minimum of twenty years in jail, possibly life; (2) it’s not certain that the military commissions would have allowed evidence obtained by coercion (Charlie Savage also made this point in his article for the New York Times), (3) the conspiracy conviction in civilian court is solid on appeal, but not necessarily so in a military commission (conspiracy is not a traditional law of war violation, and three sitting Supreme Court justices have questioned its application in that forum); (4) the forum of conviction is less ripe for attack in courts of law and public opinion.

That’s a good outcome.

On Thursday the Senate Judiciary Committee unanimously approved the Combating Online Infringements and Counterfeits Act. Its backers, including Hollywood and the recording industry, are hoping to rush the legislation through Congress during the current “lame duck” session. The legislation empowers the attorney general to draw up a list of Internet domain names he considers to be “dedicated to infringing activities,” and to obtain a variety of court orders designed to block access to these sites for American Internet users.

To understand the proposal, it helps to know a bit about the Domain Name System, or DNS, that is the focus of the bill. The DNS is the Internet’s directory service. Computers on the Internet are assigned (mostly) unique numbers like “72.32.118.3,” but these numbers are not convenient for human users to remember. So instead websites use domain names like “cato​.org,” and our computers use the DNS system to automatically translates these names into their corresponding IP addresses. DNS is a distributed system; thousands of Internet Service Providers operate DNS servers for the use of their own customers.

Under COICA, when the attorney general accused a domain name of being “dedicated” to copyright infringement, the courts would issue orders not against the owners of the domain name (who may be overseas) but against domain-name registrars and the operators of DNS servers here in the United States. This means that thousands of systems administrators would be required to maintain a large and constantly-changing list of blacklisted domains. This is a significant and unfair administrative burden on private parties who have absolutely no connection to infringing activities.

The legislation falls far short of constitutional due process requirements. Legal injunctions would be issued upon the attorney general’s mere accusation of “infringing activities.” Not only would the owner of the domain name not have an opportunity to contest the allegations, he would not even have to be notified. And the parties who would receive notice under the legislation—DNS registrars and server administrators—will typically have no knowledge of or connection to the accused domain, which means they would have neither the knowledge or the motivation to dispute unreasonable orders.

This is especially problematic because we are talking about constitutionally-protected speech here. The Supreme Court has long held that prior restraints of speech are unconstitutional. The websites on the government’s blacklist may have a large amount of constitutionally-protected speech on them, in addition to allegedly-infringing material. Not only does COICA not require the government to prove its allegations before a domain name is blocked, it doesn’t require the government to ever prove them.

Earlier this year, my colleague Jim Harper praised Secretary Clinton’s speech making Internet freedom a centerpiece of the Obama administration’s diplomatic agenda. Secretary Clinton was right to lecture foreign governments about the evils of Internet censorship; her former colleagues in the US Senate should listen to her.

There seems to be a lot of confusion about the meaning of GM’s IPO today. A common narrative in today’s media is that GM’s return to the stock market affirms the wisdom of the auto bailout. Some tougher customers in the media insist on a higher threshold being met—that taxpayers get back the entirety of their $50 billion investment in GM—before declaring “mission accomplished.” And then there are the rabid partisans who—in their seething animosity toward the Obama administration—reach conclusions devoid of logic and rich only in conspiratorial-mindedness. For example, yesterday I was contacted by a media outlet vetting this conclusion: “The IPO is evidence of the failure of the bailout because taxpayers were excluded from buying shares at the IPO price and, therefore, denied the opportunity to get their money back.” Huh?

All of those analyses are wrong. Let me dispense with the last one first, as it simply betrays a gross misunderstanding of how taxpayers are on the hook. By divesting of GM (i.e., selling its shares), the government is beginning to make the taxpayer whole. But just as there were no checks written directly from taxpayers to GM, there will be no checks written to taxpayers, as the Treasury liquidates the public’s share of GM. Whether main street Americans could participate in the IPO has nothing to do with making the taxpayer whole. And, by the way, IPOs typically limit sales of shares at the initial price to a chosen few. So let’s just shelve the canned indignation on this claim. It’s a distraction.

Here’s the real issue. Today’s IPO is nothing more than testament to the fact that the government threw GM a lifeline, enabling the company to expunge most of its debts and firm up its balance sheet on terms more favorable than a normal bankruptcy process would have yielded. That enabled GM to partake of the cyclically growing U.S. auto market in 2010 and turn a profit through the first three quarters. So what? Did anyone really think that a chosen company so coddled and insulated from market realities couldn’t turn a short-run profit? Yes, even GM, under those favorable conditions should have been expected to turn a profit this year.

But at what cost? That answer—even the question—seems to be elusive in the public discussion of the IPO. The cost was not only $50 billion—the amount diverted to GM in the first place. Nor was it that $50 billion minus the proceeds raised in today’s IPO (and minus the proceeds raised later when the government divests entirely of GM – it will still hold 33% of GM after today). In other words, making taxpayers whole does not absolve the Bush and Obama administration’s for the auto intervention. Recouping the $50 billion only gets us partially out of the hole. (And I’m not even sure who “us” includes because the costs are so far reaching.)

Yes, GM is making sales and accounting for market share, but only at the expense of the other automakers. Had GM been forced to severely atrophy or liquidate, the other automakers would have had greater revenues, more market share, and probably higher profits). They would have been able to attract GM’s best engineers and line workers. They would have more money to invest in R&D and to lead the industry into the future. Instead, by keeping GM in the mix, some of those industry resources remain misallocated in a company that the evolutionary market process would have made smaller or extinct. 

The auto industry wasn’t rescued with the GM bailout. GM was “rescued.” By rescuing GM, the government overrode market forces, and there are significant costs to assign for that. Witness the stagnant economy with 9.6 percent unemployment. Is it not plausible that businesses are sitting on their cash and not investing or hiring because of the fear inspired by the government interventions starting with the bank and auto bailouts? It’s more than plausible. The regime uncertainty that persists to this day was spawned by the GM bailout and other interventions.

What about the weakening of the rule of law? Doesn’t the diversion of TARP funds by the Bush administration, in circumvention of congress’s wishes and in contravention of the language of the law, represent a cost? How about the property right of preferred bondholders who were forced to take pennies on their investment dollars under the Obama bankruptcy plan? Any costs there? What about U.S. moral authority to dissuade other goverments from meddling in their markets or indulging industrial policy? That may be costly to U.S. enterprises. And with the government still holding a third of GM, its hard to swallow the idea that public interest will be the driver of policies affecting the auto industry. And that suggests even more costs.

But don’t mistake this blog post for an anti-IPO rant. I’m in favor of the IPO. It couldn’t have happened sooner. But I suspect the investment bankers, the administration, and the other members of GM’s Board of Directors reckoned that, with the hype over the new Chevy Volt and the recent newsleak of GM’s $43 billion in unorthodox tax deferrments on the balance sheet, now was the perfect time to go public.