California never seems to run short of bad policy ideas. But the Golden State’s latest exercise in ignoring the fundamentals of economics has to go to the top of the list.

This week the legislature narrowly passed the Fast Food Standards and Accountability (FAST) Recovery Act which would effectively allow the state to set wages, benefits, hours, and working conditions for their fast food industry. The legislation, AB 257, would establish a Fast Food Council as part of the state Department of Industrial Affairs, composed of representatives from fast food franchises, fast food workers, labor unions (euphemistically referred to as “advocates for employees”), and a representative from the Governor’s Office of Business and Economic Development; the council members would be appointed by the Governor, the Speaker of the Assembly, and the Senate Rules Committee. The Council would have the authority to impose labor agreements on all fast food franchises with at least 100 locations nationwide.

And, if the new statewide Council is not enough regulation of the fast food industry, the legislation would also allow any city or county with a population of at least 200,000 to establish their own councils to regulate businesses within their jurisdiction—as long as they don’t reduce any benefits established by the state Council. The ratchet works only one way: they can increase regulations, but never reduce them.

In a brief nod to economic sanity, the Council’s power is not unlimited. For instance, the Council(s) cannot raise wages above an initial $22/​hour, indexed annually to the CPI. The Councils also cannot establish new paid sick leave or vacation benefits. Even so, the legislation will almost certainly end up imposing substantial costs on franchise owners, customers, and the Californian economy. One study by economists at the University of California Riverside estimates that the legislation could eventually raise labor costs by as much as 60 percent and increase fast-food prices by about 20 percent. And, at a time when there is an extremely tight labor market, there is also likely to be a spill-over effect from raising labor costs in other retail industries. Moreover, the state’s Department of Finance warns that taxpayers will end up footing the bill for unknown but “significant ongoing costs” to monitor and enforce the measure.

The economic literature on minimum wage increases has become murkier in recent years, but the overwhelming majority of economists agree that large minimum wage increases in excess of productivity gains means that employers will operate at a loss as far as the effected workers go. Given that the average profit margin in the fast food industry is just 6–9 percent, those costs are almost certain to be passed along in terms of higher prices or lost jobs. It is unclear whether the Councils could prevent fast-food franchises from laying off workers in the event of higher labor costs (already automated kiosks are replacing many fast food workers), but there is nothing they could do to prevent some franchises from closing down and leaving the state. Some companies, such as McDonald’s, have already hinted at this. Layoffs and closed businesses will almost certainly end up hurting low-income communities and communities of color most heavily. Generally low-wage areas of the state, like the Central Valley, will also be hit disproportionately hard.

Making matters worse, this legislation is remarkably unnecessary. The statewide minimum wage is already $15/​hour and is set to rise 50 cents next year, and most large California cities, including Los Angeles and San Francisco, already have higher minimum wages. Besides, as noted above, there is a very tight post-pandemic labor market, giving workers strengthened bargaining power.

Governor Newsom has not yet announced whether he will sign the measure, and many analysts suggest he may be leaning towards a veto. Still, the governor is under enormous pressure from organized labor which has spent nearly $5 million lobbying in favor of the bill (outspending opponents by more than 5 to 1). If he signs this misguided legislation, he will end up damaging the state’s economy and hurting its most vulnerable workers.

A decision is expected in the next few days.

Last week the president and chairman of the Transportation Institute, James L. Henry, claimed that Jones Act carriers (shipping companies) were 27 times more affordable than non-Jones Act carriers during the pandemic. The basis for his statement was a new report released by the Transportation Institute—which lists the Jones Act’s preservation among its top objectives—touting the 102-year-old law’s alleged benefits to Puerto Rico. Even by the loose standards of Jones Act advocacy it’s an astonishing piece of misdirection and obfuscation.

Most people would probably interpret Henry’s statement to mean that Jones Act shipping was 1/​27th the price of non-Jones Act shipping in recent years. But that’s not what is going on here. Indeed, the study’s executive summary (curiously, no copy of the full report has been made public) explicitly states that the survey its findings were based on “did not directly assess price level differences between Jones Act and non-Jones Act routes.” Rather, the 27x figure comes from comparing the rate of increase in shipping prices during the pandemic for Caribbean routes—with Jones Act and non-Jones Act shipping routes in the region all lumped together—to a global average.

In other words, the claim is based on an apples-to-oranges comparison and utterly unmoored from reality.

That it was nonetheless made is perhaps explained by the far less eye-catching result from a more sensible comparison. When the report compared rate increases on Jones Act shipping to Puerto Rico with increases in non-Jones Act rates to the neighboring islands of Jamaica and the Dominican Republic it found them to be similar. In the report’s own words, “…rate increases on domestic [Jones Act] routes the prior three years are comparable to rate increases on other [non-Jones Act] Caribbean routes.”

It seems doubtful that was the result the Transportation Institute was hoping for, particularly during a time of turmoil in international shipping.

In evaluating these percentage increases, meanwhile, it must keep in mind that Jones Act rates begin at a significantly higher number. For example, a 2012 Federal Reserve Bank of New York report noted that shipping a twenty-foot container from the East Coast to San Juan, Puerto Rico was twice as expensive as to nearby Santo Domingo, Dominican Republic ($3,063 versus $1,504) and nearly twice that of shipping to Kingston, Jamaica ($1,687).

If one takes these rates and applies them to the percentage increases listed in the report for San Juan (19 percent from Jacksonville and 27 percent from Philadelphia), Santo Domingo (27 percent and 33 percent), and Kingston (20 percent from both), the price difference between Jones Act shipping and non-Jones Act shipping actually increases.

No wonder Jones Act shipping firms are so adamant about keeping out foreign competition.

Beyond its discussion of cost increases, meanwhile, the report also cites survey data indicating the superior performance of Jones Act-compliant carriers compared to their foreign counterparts in such areas as “customer service” and “ease of booking.” But there’s one true test for assessing which companies offer the better deal: competition. Determining product or service superiority is a task best left to consumers registering their votes through market forces, not industry-funded studies.

And that’s really the heart of the matter. Claims that Jones Act shipping is competitive or offers a good value ring hollow so long as the market is shielded from foreign competition. If Jones Act shipping was truly competitive then firms operating under the law wouldn’t cling to such protectionism.

There are also a few other items worth keeping in mind:

• It’s instructive that the Jones Act-exempt U.S. Virgin Islands, a U.S. territory that neighbors Puerto Rico, have not clamored to be placed under the law. Indeed, they have resisted past efforts in Congress to subject the island to the Jones Act.

• Some of the same companies that serve Puerto Rico with expensive U.S.-built and U.S.-flagged Jones Act vessels choose to employ foreign-flagged shipping on their routes to foreign ports in the Caribbean. Crowley, for example, operates Jones Act-compliant shipping to Puerto Rico but opts for foreign-flagged vessels to destinations in the Dominican Republic, Haiti, Jamaica, and other Caribbean ports. Saltchuk, meanwhile, serves Puerto Rico via its Jones Act-compliant TOTE Maritime subsidiary while another subsidiary, Tropical Shipping, offers foreign-flagged service throughout the Caribbean. If Jones Act shipping offers a compelling value proposition, why aren’t these vessels employed on all Caribbean routes?

• Jones Act shipping is sufficiently expensive that it appears to strongly deter Puerto Rico’s purchase of fuel from the U.S. mainland, even as neighboring Dominican Republic turns to the United States as one of its top suppliers. In the case of liquified natural gas (LNG) and liquefied petroleum gas (LPG), transporting these fuels from the U.S. mainland to Puerto Rico is simply not possible due to the complete lack of appropriate Jones Act-compliant vessels. That forces to Puerto Rico to purchase these fuels at higher cost from elsewhere, a burden that officials have placed in the hundreds of millions of dollars for LNG alone. Such costs and the non-existence of certain types of shipping merit inclusion in any discussion regarding the Jones Act and Puerto Rico.

The Jones Act has been hurting Puerto Rico for a long time. That’s the inevitable result of shipping protectionism that thwarts competition and requires the use of ships significantly more expensive to build and operate than their internationally-flagged counterparts. While the law harms the entire country, it is a particular hardship for an economically struggling island that is heavily dependent on ocean transport. That reality cannot be wished away or ignored, no matter how many unsupported claims or flawed studies Jones Act advocates release.

In a recent Bloomberg column, former New York Fed President Bill Dudley echoes a conventional Fed narrative, contrasting Fed interest rate cycles under two supposedly distinct chairmen.

“Powell will need to find a way to persuade [markets] that he has no intention of behaving like Arthur Burns (the Fed chair who relented prematurely in the 1970s),” writes Dudley, “lest he later be forced to act like Paul Volcker—who had to correct Burns’s mistake by putting the economy through two recessions.”

In this familiar parable, Arthur Burns (Fed chairman from Jan 21, 1970 to March 8, 1978) is depicted as a timid dove who let inflation get out of hand in the 1970s by not keeping the federal funds rate high enough long enough. “America suffered a decade of inflation,” write Thomas Sargent and William Silber, “because Burns failed to do enough, soon enough and for long enough.” After the 1975 recession, “he never raised interest rates high enough to curb accelerating prices.”

By contrast, his successor Paul Volcker (Fed chairman from August 6, 1979, to Aug 11, 1987) is commonly lionized as a hero who courageously broke inflation by relentlessly keeping the federal funds rate as high as 14–19%—assiduously avoiding a hasty “pivot” to lower rates in recessions.

Chairman Jerome Powell, in his recent remarks at the Jackson Hole conference, repeated the obligatory ritual of honoring Chairman Volcker’s resolve to “keep at it until the job is done”: “The successful Volcker disinflation in the early 1980s,” said Powell, “followed multiple failed attempts to lower inflation over the previous 15 years.”

This allegorical contrast between the fearless Paul Volcker and spineless Arthur Burns has long been retold among the Fed’s hundreds of economists. It is regularly reiterated in Wall Street Journal editorials and articles, such as “For the Fed, Easing Too Soon Risks Repeat of Stop-and-Go 1970s.” “Stop-and-go” the author explained, “refers to how the Fed oscillated between raising rates to tame inflation and then backing off to shore up growth—succeeding at neither… It worsened under Fed Chairman Arthur Burns, who raised rates significantly between 1972 and 1974 but cut them the following year in the midst of a sharp recession. Inflation fell but settled at still-elevated levels… Ultimately, it took a change in tactics by the Fed in 1981 under Chairman Paul Volcker to raise rates to far higher levels for inflation to come down and stay down.”

The implicit theory behind this story rests precariously on what Milton Friedman described as “the old fallacy of identifying tight money with high interest rates and easy money with low interest rates.” Interest rates were not extremely low from 1930 to 1933 because the Fed was pursuing an inflationary easy money policy. And Argentina and Turkey do not have higher interest rates than Switzerland and Japan because Argentina and Turkey are blessed with braver central bankers, eager to “fight inflation” with high rates for as long as it takes.

Irving Fisher (1867–1947) taught us to expect nominal interest rates to adjust to inflation, moving in the same direction eventually.

Even in Fisher’s time, low inflation and high interest rates were never seen together for long, nor were high inflation and low interest rates. Martin Uribe at Columbia University thus finds “monetary shocks that increase the nominal interest rate and inflation in the long run cause increases in interest rates, inflation, and output in the short run.” Since inflation causes higher interest rates, how can higher interest rates be considered the cure for inflation?

“Because the relation between interest rates (the price of credit) and the supply and demand for money is similarly ambiguous,” explains Scott Sumner, “the direction of rates should not be used as an indicator of expansionary or contractionary monetary policy, as lower rates could mean either.” As John Cochrane explains, “Nobody Knows How Interest Rates Affect Inflation.”

The “Fisher Effect” is one of several reasons why it is foolhardy to rely on interest rates as a target or indicator of the stance of monetary policy; Jeffrey Rogers Hummel enumerates others in an important paper questioning “Central Bank Control over Interest Rates” in the long-run.

In addition to being conceptually ambiguous, the Fed clerisy’s strong distinction between myopic interest rate suppression under Burns versus patient rate-hiking under Volcker also suffers the additional shortcoming of being factually untrue.

What really happened under the Burns and Volcker Federal Reserve regimes can be easily seen in three graphs.

The first graph, for 1970 to 1978, confirms that the Burns Fed did indeed cut the fed funds during two recessions. But so has every other Fed regime.

“In a typical recession,” Ben Bernanke writes in 21^st Century Monetary Policy, “the Fed stimulated the economy by cutting the funds rate by 5 and 6 percentage points” [page 93]. Six percentage point rate cuts turn out to be a big understatement, particularly during Volcker’s years.

During the first Volcker recession in 1980, the Fed quickly slashed the fed funds by more than ten percentage points: That rate averaged 18.8% from March 26 to April 20 in 1980 but fell to only 8.6% by early June.

The fed funds rate was quickly increased again to 19.1% when President Reagan took office in January 1981, ensuring a deep recession that began in July 1981 and ended in November 1982. Meanwhile, the fed funds rate was reduced from the 19.1% peak to 8.5% by February 1983. That was the second 10-point rate cut from a gentleman now celebrated for never “pivoting” to lower rates when the economy implodes.

The Greenspan Fed cut the funds rate more gradually, but deeply. In the first Greenspan/​Gulf War recession, the funds rate fell from 9.9% in March 1989 to 2.9% in December 1992. In the second, the funds rate fell quickly from 6.5% in November 2000 to 2.1% a year later, then continued dropping to 1% by July 2003.

The historical record of 7–10 percentage point rate cuts under Greenspan and Volcker helps to place Chairman Burns’ performance in perspective.

It is plausible that “Nixon persuaded [Burns] to keep interest rates down ahead of the 1972 election.” But the first graph makes that uncertain, were it not for the artificially low inflation numbers. If judged only by inflation statistics, the graph shows a quarterly fed funds rate of 4–5% in 1972 comfortably above year-to-year PCE inflation after the first quarter. But measured inflation was largely an illusion due to wage and price controls, which Burns had supported ever since his 1957 pamphlet “Prosperity Without Inflation.” His support for Nixonomics revealed Burns to be a dreadful economist, but his record as Fed chairman was typical for years with a major global oil shock (such as 1974, 1980 and 2008).

In 1973, Phase III price controls collapsed due to (1) growing shortages and (2) soaring oil prices as Arab oil producers cut production to protest Western support of Israel in the Yom Kippur War. Yet the graph nevertheless shows that the fed funds rate kept rising in step with (and slightly ahead of) the 12-month inflation trend until the middle of the recession.

The Burns Fed was no wimpier than the Volcker Fed when it came to gratuitous abuse of temporarily super-high interest rates in its quixotic battle with Arab oil producers. But their relatively stubborn refusal to pivot to a lower rate in the 1974–75 recession was not braver, just more reckless. For the Burns Fed to spend six months in recession before pivoting to common sense achieved nothing but senseless distress. Predictably, the fed funds rate fell more than 7 percentage points under Arthur Burns too—from 12.9% in July 1974 to 5.5% in March 1975.

“After that he never raised interest rates high enough,” according to Sargent and Silber, yet the first graph shows the funds rate was above the PCE inflation rate when Burns turned over the chairmanship to the now-forgotten G. William Miller in March 1978.

While Miller was chairman, from March 1978 to July 1979, the fed funds rate was raised from 6.8% to 10.5%, even though year-to-year PCE inflation rose by only one percentage point (from 6.4% to 7.4%). By July 1979, before Volcker took charge, the fed funds rate soared to 3.2 percentage points above the 12-month inflation (and 2 points above the 10-year bond yield).

Fast forward to the next big oil price spike under Ben Bernanke.

A 1997 paper by Bernanke, Gertler, and Watson demonstrated that every recession since the Suez Canal Crisis of 1957 was preceded by a spike in the world price of oil and a spike in the fed funds rates. Surprisingly, when Bernanke became chairman in February 2006, and the price of West Texas crude oil (WTI) was $61.63, he too presided over continual increases in the fed funds rates as oil marched above $145 by early July 2008.

The Bernanke Fed finally stopped raising the funds rate and left it at 5.25% from July 2006 to July 2007 before reducing it by one percentage point when the Great Recession started that December. That was ahead of the recession curve but behind the yield curve, which kept flashing a red warning sign of recession. Well after the Great Recession was obviously severe, the funds rate was still 2% from May to August 2008. It did not start falling sharply (to 0.15%) until the price of WTI crude fell from $133 in July 2008 to $44 in December. Like his predecessors, though, Bernanke too cut the funds rate by 5 percentage points eventually. Unlike them, he vastly expanded bank reserves by buying Treasury debt (QE), paid banks interest for holding those reserves, and offered “forward guidance” promising the funds rate would be kept near zero.

Comparing the rate-cutting record of Arthur Burns to that of Volcker, Greenspan, and Bernanke, it is obvious dishonesty to claim Burns merits special condemnation for cutting the fed funds rates after the FOMC inverted the yield curve and launched another recession. Every Fed Chairman since Burns raised rates until the recession was painful, then cut rates 5–10 percentage points.

The second graph repeats the first, except that the years describe the Volcker Fed. The blue line shows PCE inflation, and the red the fund rates.

Paul Volcker had the misfortune of being Fed Chairman during the second of the three biggest oil price shocks so far. Burns had the same rotten luck in 1973–73 and Bernanke in 2007-08. Since oil price spikes always inflate consumer inflation, even core measures, the Fed always tried to fight higher world oil prices with higher domestic interest rates. Each effort involved first pushing the federal funds rate unusually high, then unusually low.

The last graph depicts the Burns and Volcker eras—as nearly identical improper overreactions to two major oil shocks. The reduction in world oil supply during the Arab-Israeli War pushed crude oil prices up 184% by February 1974, compared with a year before, so the Burns Fed put the fed funds rate above 12%. The higher cost of energy and credit pushed the economy into recession, so the fed funds rate was quickly reduced.

The Iranian Revolution again pushed crude oil up 149% by April 1980, so the Volcker Fed put the fed funds rate above 15%. The higher cost of energy pushed the economy into recession, so the fed funds rate was reduced more deeply and quickly than ever before or since. In the Fed’s cherished Burns-Volcker allegory, the astonishing cut in the funds rate in 1980 is invariably described as “what happened in the ’70s”—under Burns or Miller—rather than what happened in 1980. Such stylized facts safeguard the folklore.

The price of a barrel of WTI crude oil rose from $14.85 in January 1979 to $39.50 in April 1980 but was back down to $11.58 by July 1986. What “forced” the Volcker Fed to raise the funds rate to 19% twice (before cutting it by 10 points in the twin recession) was a global oil price spike—like 1973–74 under Burns, 1990–91 under Greenspan, and 2007-09 under Bernanke.

The black line shows the monthly year-to-year changes in the price of WTI crude. The blue line shows the quarterly year-to-year PCE inflation, which rose and fell with oil prices. The red line shows the quarterly fed funds rate, which also tended to rise and fall with oil prices (though belatedly in 1982).

PCE inflation slowed in 1980, even as the funds rate was being cut ten percentage points, and inflation continued to slow in 1981 as the fed funds rate was briefly raised to 19% before being cut another ten points. The funds rate rose again from about 8% to 14% in 1983–84, even though core and all-items PCE inflation was 4% or less after mid-1983. The main reason for slowing PCI and CPI inflation after the 1980 oil shock was clearly the end of the Iranian Revolution and the subsequent Iran-Iraq War.

Oil fell from $35–40 between April 1980 to April 1981 to below $30 in 1983–84, to under $20 from 1986 to 1989. Paul Volcker’s famous victory over inflation in 1983–86 mainly consisted of a deep drop in the price of oil—thanks to peace in Iran and Iraq (until the 1990–91 Gulf War).

To sum it up, Burns was not an inferior Fed chairman because he cut interest rates sharply in two recessions for the obvious reason that Volcker cut interest rates even more in two other recessions, as did all other Fed Chairmen before and since.

Neither Burns nor Volcker seemed to realize how little a central could do to bring inflation down until the global price of oil stopped rising, then fell. High domestic interest rates might lower worldwide oil prices by contributing to a worldwide recession, but cyclically depressed prices from a global “going out of business sale” are temporary. The rising dollar under Volcker probably helped keep oil prices cheaper in the dollar than in other currencies, but that doesn’t help explain why inflation also came down when oil prices did during the Burns and Greenspan years when the dollar was weak.

What primarily allowed us to avoid major oil price spikes and related global inflation from mid-1983 to 2006, and again from 2010 to 2019, had essentially nothing to do with who happened to be Fed chair, and everything to do with the absence of wars and revolutions in oil-producing countries (such as Russia).

If Federal Reserve historians must single out specific chairmen for special recognition, many of them have earned credit for 13 hard landings.

[Cross-posted from Alt‑M.org]

How best can we keep America from entering a constitutional succession crisis or suffering a turn toward authoritarianism? As readers may remember from my post last month (see also), several of us at Cato contributed as “Team Libertarian” to the National Constitution Center’s essay project “Restoring the Guardrails of Democracy” on this topic. This week the Volokh Conspiracy is hosting a symposium featuring participants, with me writing for Team Libertarian, Prof. Ned Foley for Team Progressive, and David French for Team Conservative. Each of us is starting off with a post laying out our affirmative case. Mine is here.

You should read the whole thing, but a few highlights from my point-by-point proposals for preventing an election crisis:

• Electoral Count Act reform should confine each actor to its proper role after a presidential election, clear up ambiguous and confusing terms in the present law, and keep partisans from using the process to re-litigate the underlying election.
• Congress should move to constrain the executive branch’s resort to dangerous emergency powers. The law should make clear (or even clearer than now) that presidents do not have unbounded discretion to invoke the Insurrection Act, seize voting machines without a court order, declare martial law when civil order has not broken down, or in other ways use peremptory executive power to overturn or block an election.
• Counter distrust with a credibility agenda, recognizing that in an age of distrust systems need to be both secure against fraud and bad practice, and visibly so. Examples: improve methods of keeping voter registration rolls accurate and up-to-date; strengthen audits. States should facilitate, and where appropriate mandate, reporting of substantially complete returns on election night, to counter the viral popularity of “overnight steal” claims.
• Look for ways to incentivize losing candidates to concede. Former President Trump has set the worst example in crying fraud after losing a contest, but he has not been the only offender.
• Watch out for proposals to gather ever greater election say over election administration to Washington, D.C., which would provide a single attractive target for bad actors to pressure or subvert. We should be wary of what economist Steven Landsburg calls “centralizing the power to decide who will yield power.”
• Avoid innovations that invite succession crises. One example: the ill-thought-out National Popular Vote Compact, in which states pledge to cast their electoral votes for the national popular vote winner even though no way is offered to secure an authoritative tabulation of that vote, so that it can be agreed who won.
• Turn down the temperature and stop delegitimizing key institutions. Both sides need to listen on this. It’s one thing to decry worsening polarization as if it were all the other team’s fault. It’s another to resist the partisan temptation to delegitimize the existing institutions and machinery of our republic – whether the Supreme Court, the U.S. Senate, or local election administrators – because they don’t yield the short-term results you want.

I go on to summarize the report’s two other sections, by Cato colleague Clark Neily on the role of the jury and by Volokh Conspirator (and George Mason lawprof) Ilya Somin on the benefits of choice between governments.

I think classical liberals and libertarians can play a constructive role in a conversation about guardrails given our particular attachment to the rule of law, constitutionalism, checks and balances, and limitations on government power in general. By instinct, we understand and fear how a government is likely to start behaving once its top officials know that voters cannot turn them out of office.

Later in the week Foley, French, and I will each write a post responding to, and sometimes taking issue with, the proposals from the others. Check back to see how that develops.

As I have written on numerous occasions, most recently here, the opioid overdose crisis was never caused by doctors “overprescribing” pain medicine to their patients. As researchers at the University of Pittsburgh reported in 2018, the overdose rate has been rising exponentially since the late 1970s, with different drugs dominating at different points in time. The researchers stated, “This process may continue along this path for several more years into the future.” The U.S. Congressional Joint Economic Committee reported that overdose deaths began their rise as far back as 1959. Now a new report by modelers at Northwestern University, the University of Florida, and Yale University, reported in the Journal of the American Medical Association, predicts the U.S. may be heading towards an even larger wave of overdose deaths.

In a Cleveland Plain Dealer interview with the study’s lead author, Lori Ann Post of Northwestern University School of Medicine, reporter Gretchen Cuda Kroen wrote:

The reason for the most recent increases in opioid overdose fatalities is thought to be due to the fact that people are now mixing cocktails of extremely dangerous and potent opioids like fentanyl, which is 100 times stronger than morphine, and carfentanyl, which is 100 times stronger than fentanyl. In addition, users have begun adding stimulants like cocaine and methamphetamines to the mix.

“Now we have people taking a stimulant with their opioid cocktail, and they are killing themselves on it,” said Post.

What Post and her colleagues found even more striking was the fact that while opioid deaths have been the scourge of rural communities rather than cities in the past, the coming wave doesn’t appear to discriminate between the two.

All this is happening despite a 60 percent drop in opioid prescribing from 2011 to 2020. Furthermore, the Drug Enforcement Administration (DEA) placed quotas on the manufacturing of all types of prescription opioids, ratcheting those quotas downward year after year. By 2019, the reduction in the prescribing rate led the DEA to announce that less than one percent of controlled substances distributed to retail purchasers were getting diverted.

As I wrote with co‐​authors in the Journal of Pain Research, there is no correlation between prescription rates and non‐​medical use of or addiction to opioids. On June 7, 2022, I stressed this and other facts at a Soho Forum debate in New York City. I pointed to data from the National Survey on Drug Use and Health showing the addiction rate among persons aged 18 and above has been essentially unchanged while prescription rates were first surging to record highs and then, starting in 2012, dropped 60 percent. I also argued that there is no reason to conclude that doctors “hooking” patients on opioids would compel them to use multiple other drugs in “cocktails.” We now know the great majority of overdose deaths are “polysubstance” deaths.

No one familiar with the Iron Law of Prohibition should be surprised at the modelers prediction. Sadly, until policymakers finally realize that drug prohibition, not doctors treating patients in pain, is the cause of the overdose crisis and the coming “tsunami” of overdoses the modelers predict, expect the deaths to keep mounting and patients to continue suffering needlessly.

Despite the redactions contained in the search warrant affidavit, there’s enough there to give us a better idea of the sequence of events in this saga to date.

The Timeline

By May 6, 2021, National Archives (NARA) officials began asking Trump and his representatives to return records that were supposed to have previously been transferred to NARA by Trump’s last day in office. Those requests went unanswered until December 2021, when Trump’s representatives informed NARA officials that 12 boxes were at Mar-a-Lago.

For reasons that remain classified (per pp. 14–16 being either largely or completely redacted), it appears that the number of boxes examined by the FBI in May 2022 was actually 15 versus the 12 originally reported by Trump’s representatives. Fourteen of the boxes contained a total of 184 classified documents, ranging from CONFIDENTIAL to TOP SECRET, including documents labeled “HCS”—intelligence community short-hand for HUMINT Control System. As the affidavit notes, “The HCS control system protects human intelligence-derived information and information relating to human intelligence activities, capabilities, techniques, processes, and procedures.” (p. 4)

Upon discovering that the classified material was in no way secured according to established U.S. government policy on the handling and storage of classified information, the Department of Justice (DoJ) counsel overseeing the investigation told Trump’s counsel on June 8, 2022, “…that the room at Mar-a-Lago where the documents had been stored be secured and that all of the boxes that were moved from the White House to Mar-a-Lago (along with any other items in that room) be preserved in that room in their current condition until further notice.” (p. 22).

Last week, the New York Times reported that, “Aides to Mr. Trump turned over a few dozen additional sensitive documents during a visit to Mar-a-Lago by Justice Department officials in early June.” Why the FBI did not seize all of the material at that time is unclear, and the specific reasons may be contained in some of the redacted pages of the affidavit.

Sometime after June 9, the FBI came to believe that even more classified material remained at Mar-a-Lago in an improperly secured state. As we now know, the investigation intensified in the period between June and early August 2022, at which time the FBI seized over 20 boxes of material containing classified information.

The Implications

When Trump left office, he no longer could lawfully retain any classified information. Moreover, at no time has evidence surfaced that Trump issued any executive order declaring the information he wanted to take to Mar-a-Lago to be declassified, in contrast to how President Clinton handled a mass federal government document declassification decision in 1994. Absent such a formal, established declassification process, the material in question remains classified in the eyes of the agency or department from which it originated.

Further, even if Trump had properly declassified the original documents, those originals remain the property of the people of the United States via the Presidential Records Act, Section 2202, which states:

The United States shall reserve and retain complete ownership, possession, and control of Presidential records; and such records shall be administered in accordance with the provisions of this chapter.

The most serious charge Trump (and perhaps others in his orbit who had access to or responsibility for storing the purloined classified documents) faces is 18 U.S.C. § 793(e), a provision of the Espionage Act that, per the affidavit, states in relevant part:

“[w]hoever having unauthorized possession of, access to, or control over any document…or information relating to the national defense which information the possessor has reason to believe could be used to the injury of the United States or to the advantage of any foreign nation, willfully communicates, delivers, transmits or causes to be communicated, delivered, or transmitted” or attempts to do or causes the same “to any person not entitled to receive it, or willfully retains the same and fails to deliver it to the officer or employee of the United States entitled to receive it” shall be fined or imprisoned not more than ten years, or both.

What Comes Next

With the investigation clearly ongoing, it’s unknown at this point when, or even if, Attorney General Merrick Garland will move forward with formal charges against Trump or others involved in “Documentgate.” But there was one other line in the affidavit (p. 2) that jumped out at me, and it’s significant:

There is also probable cause to believe that evidence of obstruction will be found at the PREMISES.

Presumably, this is a reference to obstruction of justice (18 U.S. Code § 1503), which states:

Whoever corruptly, or by threats or force, or by any threatening letter or communication, endeavors to influence, intimidate, or impede any grand or petit juror, or officer in or of any court of the United States, or officer who may be serving at any examination or other proceeding before any United States magistrate judge or other committing magistrate, in the discharge of his duty, or injures any such grand or petit juror in his person or property on account of any verdict or indictment assented to by him, or on account of his being or having been such juror, or injures any such officer, magistrate judge, or other committing magistrate in his person or property on account of the performance of his official duties, or corruptly or by threats or force, or by any threatening letter or communication, influences, obstructs, or impedes, or endeavors to influence, obstruct, or impede, the due administration of justice, shall be punished as provided in subsection (b). If the offense under this section occurs in connection with a trial of a criminal case, and the act in violation of this section involves the threat of physical force or physical force, the maximum term of imprisonment which may be imposed for the offense shall be the higher of that otherwise provided by law or the maximum term that could have been imposed for any offense charged in such case.

Given how much concern DoJ officials expressed about potential witness intimidation attempts as a result of making the affidavit public, as has already happened with some witnesses who appeared before the House January 6 Select Committee, it’s understandable why they fought to keep witness names and affiliations secret for now.

The last five years have been among the most domestically tumultuous in American political history. If Garland does move forward with criminal charges against Trump, no matter how well founded, he will be taking the nation into uncharted political and legal waters. Fiat Justitia Ruat Caelum.

Despite their small size, microschools are having a big impact on education. And this week’s launch of the new National Microschooling Center is likely to help as parents, teachers, and education entrepreneurs will now have a central hub for information and resources.

“Microschools are designed in a way that every child can thrive,” notes Ashley Soifer, Chief Innovation Officer at the National Microschooling Center. “Relationships are at the heart of microschooling, and as microschooling leaders build relationships with each child as an individual, it creates an educational opportunity unlike any most children have yet experienced.”

Microschools have experienced tremendous growth over the past 10–15 years—especially in the wake of COVID-related school disruptions. But many people are still unfamiliar with the idea. There’s not really a standard definition for microschools, but they are often described as modern one-room schoolhouses.

Many microschools have as few as 10 children and meet in a home, church, or community center. Prenda Microschools, which started in 2018 with seven children learning in founder Kelly Smith’s home and has grown to more than 300 locations educating more than 3,000 kids today, follow this approach.

Others, like Acton Academy, might have as many as 100 learners divided into smaller classes. Acton Academy was started by Texas parents who wanted their children to have a student-driven education that nurtures their natural curiosity. From a single location in 2009, there is now a network of more than 250 Acton Academies around the world

Microschools don’t typically separate children in single-age groups; rather the learners are generally grouped in age or skill ranges. Since there can be a lot of variance in the skills or knowledge of children of the same age, this flexibility is one of the benefits of microschools.

In addition to their small sizes, microschools are able to offer unique educational environments that are impossible in many other education models. “Today’s microschools are created around the unique educational needs of each individual child, allowing them to deliver the powerful potential not possible in more traditional, institutional settings,” says National Microschooling Center CEO Don Soifer. “This fact makes microschooling’s proliferation around the country about its transformative potential, and not the particular failings of whichever incumbent school systems they are leaving.”

The National Microschooling Center plans to be a comprehensive resource center to help the microschool movement continue to grow. The Center says its focus will be to cultivate and grow demand, build and strengthen microschool leader capacity to equip for success, drive growth-friendly policies, and mobilize united communities of practice.