Category Archives: Libertarians

The Death of David Koch

by Peter Galuszka

Imagine the coincidence. On Friday I was reading business writer Christopher Leonard’s excellent “Kochland” book on the hard-right, billionaire industrialists, Charles and David Koch. I put my Nook down for a moment to check the news. David Koch had died at age 79.

He, his brother, the rest of the family and their sprawling, secretive business empire based on oil trading and petrochemicals are fascinating topics. And, the Kochs, especially Charles, have had a huge influence in Virginia as they spread their gospel of free market libertarianism.

David Koch, who lived in New York City rather than Wichita, the headquarters of Koch Industries, had been known as a man-about-town.He was a bachelor until later in life and gave freely to medical research and the arts.

Gifts include $100 million for cancer research art his alma mater, the Massachusetts Institute of Technology where he still held the record for the most points ever scored in a school basketball game. He also gave $100 million to underwrite a ballet theater at the Lincoln Center in New York.

When he died, David and his brother were each worth about $50 billion. They got their money by running the family business, which buys and sells oil and distributes it through pipelines. They also have petrochemical plants where they make plastics used in windows, clothing and a lot more.

With Charles taking the lead, they developed a tough corporate control system that involved loyalty, secrecy and tough discipline. According to Leonard’s even-handed book, they Kochs were accused of making millions by cheating oil producers by under-reporting the amount of crude oil they received. The company settled the case. That and smart business led to success. Continue reading

Will Virginia Legalize Recreational Marijuana Use?

High times today.  The marijuana legalization wave is beginning to wash over North America. Nine states (WA, OR, CA, NV, CO, MA, VT, ME and AK) along with the District of Columbia have legalized the recreational use of marijuana.  Well over 20% of Americans now live in states which have legalized recreational marijuana use. On Oct 17 of this year recreational marijuana use will be legalized across Canada. While the various provinces will regulate the sale and use of marijuana in their own unique ways, it will be legal across Canada.

Higher times to come. Several more states are slated to decide the question of legalized recreational marijuana use this November (or sooner)…

Michigan – Voter initiated measure to permit those over 21 to grow and possess personal use quantities of cannabis and related concentrates.  Statewide polling data from this spring shows 61% of voters intend to vote “yes” on the measure. While you may not be able to drink the water in Flint it looks like you’ll be legally able to use it in a bong come this November.

New Jersey – The New Jersey legislature is debating bills that would legalize recreational marijuana in the Garden State. Interestingly, some of these bills would also expunge the criminal records of anybody convicted in the past of marijuana-related crimes. Was I ever arrested for weed?  Fuhghetaboutit!

North Dakota – A voter – initiated referendum will appear on North Dakota ballots this November. Uniquely, the North Dakota initiative would set no limits on the amount of marijuana people can possess or cultivate. Perhaps a large stockpile is required to get through those long, dark winters.

New York – A recent state commissioned study on recreational marijuana legalization came out strongly in favor of making ganja legal. Gov Andrew Cuomo quickly sprang to action setting up a working group to write a marijuana legalization bill. Put New York in the “when, not if” column.  This should give new meaning to Billy Joel’s song “New York State of Mind” (which has the opening line, “Take a holiday from the neighborhood”).

Oklahoma – This June Oklahoma voters approved a broad medical marijuana usage law. Activists have collected a lot of signatures to get the question of legalized recreational marijuana on the Nov 6 ballot. Whether there are enough signatures or enough time to get the ballot question approved this year remains to be seen. Sadly, Merle Haggard died in 2016 before being able to revise the first line of his famous song Okie from Muskogee … “We don’t smoke marijuana in Muskogee”.  It seems that sooner, rather than later, people will be openly smoking marijuana in Muskogee.

Delaware – In June, a majority of House lawmakers voted in favor of legislation to legalize marijuana use and retail sales. However, because the legislation imposed new taxes and fees, state rules required it to receive super-majority support. Lawmakers are anticipated to take up similar legislation again next year. I’ll predict that by 2020 people will be legally getting small in the Small Wonder.

A spot of hemp, Mr. Jefferson? Five of the first six presidents of the U.S. were Virginians and there is evidence that all five of them smoked a little hootch from time to time. You can read the evidence from an unimpeachable source … High Times …  here.

Will River City go up in smoke? But what of modern Virginians and Virginia politicians? In a 2017 Quinnipiac poll Virginia voters supported allowing adults to legally posses and use small amounts of marijuana by 59 – 35 percent. So, the voters would like to see marijuana legalized in Virginia. But since when did the voters matter to Virginia’s political elite? They don’t listen to voters, they listen to dollars. The Virginia Public Access Project tallies up the following donation totals for “all years”:

Beverages – Alcohol Distributors / Brokers – $20,885,384
Retail Sales – General $10,113,070
Restaurants – $6,533,357
Beverages – Alcohol Manufacturers – $3,993,418

As point of reference, Dominion Energy donated $11,354,842 during the same period.  Meanwhile, PepsiCo, owner of Frito-Lay – the maker of Cheetos – only donated $82,385.

— Don Rippert

The Scalia School: a Bastion of Conservative Thought

The Scalia School of Law at George Mason University has significant disadvantages in the scrabbling for prestige among American law schools. Founded in 1979, it’s a relatively young institution, which means graduates have had less time to accumulate wealth, donate, and leave bequests than their counterparts at older institutions have done. As a result, the school’s endowment is a negligible $4.4 million. Scalia also is part of a public institution that for many years treated it as a cash cow to be milked rather than an asset to be invested in.

Yet Scalia fares well in rankings of law school prestige — having made it into the Top 50 among 200 law schools every year over the past 18 years and having scored 41st in the most recent US News & World-Report ranking. In a 2015 ranking of scholarly impact based upon the number of law journal citations by its faculty, Scalia did even better: It scored 21st.

One reason that Scalia “punches above its weight,” suggests Dean Henry Butler, is the intellectual diversity of its faculty. “Conservatives and libertarians are under-valued in the academic marketplace,” he says. “That allows us to recruit a stronger faculty.”

Lawyers tend to be more liberal than the general population, and law school professors more liberal than practicing lawyers. A 2017 research working paper, “The Legal Academy’s Ideological Conformity” found that only 15% of law school professors are politically conservative compared to 35% for lawyers as a whole.

Scalia is a marked exception to the national norm. Of the 49 highest-ranked laws schools in the country, Scalia had the largest percentage of conservative professors, roughly 80%. Only two other law schools, Brigham Young University and Pepperdine, had majority-conservative faculties.

Not surprisingly, the conservative faculty of GMU’s law school, named after deceased conservative Supreme Court Justice Antonin Scalia, has made it a target of the left. A group called UnKoch My Campus used the Freedom of Information Act  to obtain emails and copies of gift agreements purporting to show undue influence by the conservative/libertarian Charles Koch Foundation and the conservative Federalist Society for Law and Public Policy over the appointment of faculty members and creation of programs. The allegations were repeated by the New York Times and Washington Post. GMU President Angel Cabrera has ordered an inquiry into the terms of the gifts, but he has described only two such deals as “problematic” and noted that both have expired.

UnKoch My Campus expressed shock — shock! — at evidence it uncovered showing that Dean Butler had communicated extensively with the wealthy conservative donors. Butler offers no apologies. As dean of the law school, he is the fund-raiser in chief, which makes him the schmoozer in chief. He is proud of the school’s success in funding programs that elevate its profile in the legal community.

I had the opportunity to visit Butler earlier this month. School was out for the summer, and the dean greeted me clad in shorts, sockless, tassled loafers, and an untucked button-down shirt. He came across as affable, enthusiastic, and passionate — but not dogmatic — about conservative causes. While Scalia’s law professors are mostly conservative, he noted that there are “a couple of Democrats” on the faculty. Perhaps more importantly, students feel free to express liberal views. “We don’t muzzle anybody here.”

Unsurprisingly for a free-market conservative, Butler touts the “marketplace of ideas,” and he sees the Scalia School playing an important role in that marketplace.

Founded in 1979, the law school entered its modern incarnation in 1986 when Henry G. Manne became dean at the recommendation of GMU’s two Nobel Prize winners, James M. Buchanan and Vernon Smith. Manne was a proponent of the Law and Economics school of thought pioneered by economist Ronald Coase and legal scholar Richard Posner. The breakthrough idea was that the discipline of economics could provide insights into not only areas of business law such as antitrust compliance but torts, property, contracts, domestic relations, procedure, even constitutional law.

In a 1994 essay Manne recounted how Law and Economics took root at GMU:

Much of the credit for what occurred at GMU belongs to the University President, Dr. George W. Johnson. He repeatedly said that he did not want “just another good law school.” Rather, consistent with his entire style at this new, innovative and burgeoning university, he wanted to be at the cutting edge, to set new models for other universities, and to take chances in order to move George Mason’s reputation along in a hurry. When he heard in some detail my idea for a law school, he is reported to have said to an associate, “whether Henry Manne comes here or not, that is the kind of law school we want.”

A student of Manne’s, Butler has built on the Law and Economics foundation. He has fought to keep a bigger share of the law school’s tuition revenue for the law school itself. He has raised money for massive renovations of the Arlington campus, including the digitization of much of the law library to replace oppressive stacks of books with light-imbued study and meeting space. He orchestrated the school’s name change to honor Scalia, a leading light of conservative legal thought. And he has increased outside fund raising. Most of the money goes to support six centers and institutes. Continue reading

Yes, Virginia, There Still Is a Libertarian Party

And in other news largely ignored by Virginia media over the weekend… The Libertarian Party of Virginia nominated Matt Waters, an Alexandria fund-raising consultant, as its candidate for U.S. Senate. Waters will run against Democratic Senator Tim Kaine and whoever wins the Republican Party free-for-all.

In his speech to LPVA delegates, Waters said his biggest concern is the unsustainable national debt. He characterized the $21 trillion debt as the United States’ biggest national security threat, greater than ISIS or China, and he called for an end to the failed war on drugs, the war on terror, and the war on poverty.

Vowing to campaign under the Virginia flag, the motto of which is, “Thus always to tyrants,” Waters said:

My campaign will call fellow Virginians to remember who we are, and why we fight. The tyrant today is not the king of England. It is our $21 trillion debt. The tyrant is a massive welfare-warfare state funded by the Federal Reserve that is completely unaccountable, unauditable, and 100 percent  responsible for killing the value of every single dollar we earn in this room. The tyrant is invasive. The tyrant is corrupt. The tyrant is bankrupting this country. … The tyrant invades pulpits, businesses, families, laptops, and smart phones.

It doesn’t have to be this way. I say it’s time to crush the tyrant and restore our liberty now.

Waters’ immediate challenge is collecting 10,000 signatures of registered voters, always a big hurdle for third-party candidates. Beyond that, he faces the perennial Libertarian Party obstacle of gaining media recognition. Libertarians’ traditionally low vote percentages make it difficult for candidates to get reporters to take them seriously.

One outside factor might help Waters. The Republican Party of Virginia seems to be in the process of imploding. Mini-Trump candidate Corey Stewart seems best positioned to capture the Republican party nomination, although his victory is far from certain given the number of other candidates also vying for the honor. If Stewart is nominated, he is so polarizing that he will drive many mainstream Republicans out of the party. While Kaine is widely regarded as a genuinely decent guy, he is a cog in a Democratic Party machine that is tilting farther Left every day. Homeless Republicans may well seek refuge with the Libertarian Party.

The Self-Employed as a Political Constituency

Will 3-D printers swell the ranks of self-employed manufacturers?

Will 3-D printers swell the ranks of self-employed manufacturers? Image credit: CNN

The maker movement is transforming the American economic landscape. The number of people who make a self-employed living making stuff is still small — almost imperceptible in a U.S. labor market of 160 million — but it is growing.

In 2014 more than 350,000 manufacturing establishments in the U.S. had no employee other than the owner, up almost 17% over ten years, according to Commerce Department data reported by the Wall Street Journal. By comparison, the 293,000 establishments with employees had experienced a 12% decline in number over the same period. Overall, there are roughly 12 million manufacturing jobs in the U.S.

The boom in self-employed manufacturing is most pronounced in the “food” category, but also notable in chemicals (including soaps and perfumes), transportation, leather, and beverages & tobacco.

I expect the movement to gain momentum as the revolt against mass, industrial-era standardization gives way to mass customization. Technologies such as Computer Aided Design and 3-D printers continue to gain in capability and come down in price, making them available to almost anyone. Many colleges have 3-D printers on campuses, and students are learning how to use them. Meanwhile, just as the Miller-Budweiser beer duopoly has given way to the craft beer revolution — the biggest advertising budgets in the country could not halt that consumer trend — we are seeing the revival of artisinal foods, beverages, and craft products.

The proliferation of self-employed, small-scale manufacturers is part of a larger trend toward the so-called “gig” economy. So far, the needs and aspirations of makers, hackers, craftsmen and free-lancers have gone mostly unrecognized by the political establishment. These self-employed workers are even more politically invisible than small business. They are unorganized politically. They don’t have trade associations, they don’t hire lobbyists, and they don’t donate money to politicians. Indeed, the only politician I can think of who takes them seriously is Sen. Mark Warner, D-Virginia. While the senator has performed a valuable service in highlighting the group and its unique needs, his interest in the topic does not appear to be widely shared, and he can cite few tangible accomplishments yet.

Making a living as a free-lance writer and blog publisher for the past 14 years, I feel a strong affinity for this group. In Virginia, there are hundreds of thousands of us. And as consumer tastes continue to shift from standardized products and services to personalized products and services — our numbers will grow.

We are the petite bourgeoisie. We are noted for our stubborn independence and our ornery attitude toward our “betters” who would tell us what to do. In my view (which, I concede, may not be universally shared), we don’t seek special treatment. We don’t want subsidies, tax breaks or special privileges. We just want a level playing field.

The most important legislative priority for self-employed workers is to gain more control over our health care insurance and retirement plans. Our health insurance should enjoy the same tax status as health plans provided by corporations and other major employers. Our pension vehicles should be portable as we move back and forth between conventional employment and self employment. Oh, and it wouldn’t hurt to keep a lid on taxes.

As I scan the political economy of Virginia, I don’t see anyone (other than Warner) representing the interests of the self-employed. Neither Democrats nor Republicans, beholden as they are to established corporate and bureaucratic interests, provide a natural home for us.

The Libertarian Party could become that home if it moved beyond articulating abstract principles to applying those principles to real-world problems. Indeed, if the Libertarian Party has a natural constituency, it would be the free-lancers and small businesses whose interests are routinely subordinated to those of better organized, more vocal groups who turn to the government for everything. As Libertarians run for office, they would do well to cultivate the large and growing ranks of the self-employed.

Who Will Champion Mobility as a Service?

Uber was just the first step. The App-algorithm-transportation revolution will evolve into Mobility as a Service.

Uber was just the first step. The App-algorithm-transportation revolution will evolve into Mobility as a Service. Virginia Virginians lead the way or fall behind?

Around the world, companies and muncipalities are experimenting with Mobility as a Service (MaaS). Fast Company describes how a new company, MaaS Global, is changing the thinking about transportation, in Helsinki, Finland:

If you need to go somewhere, you pull up a new app, which calculates the best way to get there—public transit, a bike-share bike, taxi, a rental car, or a combination. Instead of buying individual tickets, you pay a monthly fee of €249. …

Users can choose to link their calendars with the app, so routes will be planned in advance. With each trip, it’s possible to make a choice of transport mode based on what’s cheapest or greenest or most convenient—or mood….

MaaS Global is “in talks” with several cities in North America, Fast Company says. The company may or may not have devised a viable economic model — a fixed monthly prescription that doesn’t vary by usage seems problematic to me. But the company is only one of many experimenting in this space. Sooner or later, someone will figure out how to make it work.

Bacon’s bottom line: I’ve often referred to the integration of smart phones, algorithms and transportation as the Uber revolution because the ride-scheduling company Uber developed it first. But Mobility as a Service (MaaS) is much bigger than Uber, and its potential ramifications are even more far reaching. First and most important, it can save people money and expand their transportation options, thus improving their quality of life. Second,  MaaS could reverse the decades-long decline in shared ridership, meaning that we can get much more mileage (so to speak) out of our existing infrastructure.

Virginia can continue approaching transportation as it always has — by building new stuff, at a cost of billions of dollars a year — or it can foster the growth of Mobility as a Service. We Virginians need to ask ourselves, how can we encourage innovative transportation companies to set up shop in Virginia? We reached the right solution with Uber and Lyft, enabling them to compete in the transportation marketplace. That was a good start,  but what else can the public sector do to create a welcoming environment for entrepreneurs to expand beyond what is essentially a taxicab service?

The idea is just hanging out there, waiting for a champion. We probably can’t expect much from Republicans and Democrats, who are beholden to entrenched special interests. (The “transportation” sector has contributed roughly $35 million over the past decade to Virginia political candidates, according to the Virginia Public Access Project.) Republicans are the party of roads, and Democrats the party of mass transit. Both transportation modes are more than a century old, and both have much to fear from the MaaS revolution.

Only one party, the Libertarian Party, is the natural home for entrepreneurs and innovators who seek to disrupt the status quo. If Libertarians want to broaden their popular appeal by creating community-based, private-sector solutions for real-world challenges, then they should lead the charge for Mobility as a Service.

How to Give Virginians Real School Choice

Vouchers could make school choice a reality for thousands of Virginians.

Students at Immanuel Christian School in Northern Virginia. Tuition ranges from $7,500 to $10,000 a year. Four thousand-dollar vouchers would make school choice a reality for hundreds of thousands more Virginians.

Virginians enjoy a wide range of school choice… providing that they are affluent enough. If they can’t afford to pay private school tuition or buy a house in neighborhoods served by the best public schools, however, their options are limited.

The Old Dominion has among the smallest number of charter schools in the country — nine. The state does provide a tax credit to encourage donations to approved educational foundations, of which there are 34. But in fiscal 2016 those foundations provided only 2,882 scholarships — no more than a rounding error in the Commonwealth’s nearly 1.3 million school-age population. Virginia does allow parents to home-school their children, but the number of families in a position to pursue that option also is modest — the Virginia Department of Education counted only 33,400 home-schooled students in fiscal 2016.

In sum, Virginia’s educational system does a fine job of serving the state’s more affluent citizens but restricts opportunities for those who are less better-off. The poorest households are stuck in failing inner-city and rural school districts with no way of getting out. And the quality of education in Virginia’s worst schools is abysmal. Of the state’s 1,825 public schools, 22% were either denied accreditation or received only partial accreditation under the state’s minimalist standards.

The traditional solution espoused by the teacher’s lobby is mo’ money. There is nothing about Virginia’s educational system that can’t be improved by dumping extra dollars into it! But let’s face it: Given impending budget shortfalls, the big question facing the General Assembly in January is which programs get cut and by how much. Virginia’s K-12 school system won’t be getting any more state funding next year, and chronic budget pressures over the next decade suggest that there won’t be much more forthcoming in the decade ahead.

Tinkering with the system won’t accomplish anything meaningful. The inability of the political establishment to alter the educational status quo creates a tremendous opportunity for an insurgent movement such as the Libertarian Party to advance a bold proposal.

It’s time to think big.

Broadly speaking, there are three main sources of revenue for K-12 education in Virginia: local revenue, state revenue and federal revenue. The state component, referred to in the General Fund budget as “Direct Aid to Public Education,” is budgeted to receive $5.8 billion this fiscal year, although that sum might be trimmed during the upcoming General Assembly session in anticipation of a revenue shortfall.

That $5.8 billion is distributed to local governments according to a complicated formula, but it averages about $4,500 per student.

I propose transforming K-12 education by using the state aid to empower parents and promote school choice. Parents could continue sending their children to public school if they desired, and the school district would continue receiving state aid as it always had. But anyone choosing to send a child to a private school (or home school) would receive a $4,000 voucher reflecting the state’s cost in providing that education.

Admittedly, $4,000 is not enough by itself to cover a private school tuition. But it’s enough to cover a significant portion of the tuition, making private school more affordable for middle-class families than it is today. Families that couldn’t afford to pay, say, $8,000 a year in tuition perhaps could afford to pay $4,000. For poor families, the $4,000 would supplement scholarship dollars, enabling scholarship foundations to stretch their resources over more students. For home schoolers, the sum would be a boon to distance learning, teaching collaboratives and free-lance teachers, spurring innovation in how education is organized and delivered.

The beauty of the arrangement is that it benefits public schools, too. While public districts would lose some state money, they would have fewer students to educate. Fewer students would translate into more local dollars per student. Everybody wins — everybody, that is, but the ideologues who oppose private education.

This idea is a broad framework only, and there could be many wrinkles to iron out. The most obvious is the need to hold private schools accountable. Perhaps any school accepting voucher funds would be required to meet the same Standards of Learning criteria as public schools do. Not all private schools are created equal. There needs to be a mechanism for weeding out the bad schools, and the SOLs might do the trick.

Another problem is that state aid is not distributed to school districts equally. Wealthier school districts get fewer state dollars; poorer school districts get more. Handing out vouchers would create winners and losers, and losers would oppose any change to the status quo. But that’s a small price to pay to give financially strapped families genuine school choice and to foster innovation by entrepreneurs and educators.

Natural Libertarians, a Virginia Majority

Natural Libertarians -- leaving other Virginians alone since 1776.

Natural Libertarians — leaving other Virginians alone since 1776.

It’s the holiday season, the news is slow, and I’ve been thinking about things that I probably shouldn’t be thinking about.  One is how to convert the latent “small L” libertarian potential of Virginia’s electorate into a meaningful political force.

A large percentage of the Virginia population, I firmly believe, is what writer Lee Harris has termed “natural libertarians” — libertarians by inclination, not ideology. In 2011 he wrote prophetically:

The natural libertarian, whenever he feels that his self-image as a free and independent individual is under assault, will turn to a defense mechanism that is not listed in the classic Freudian inventory: he will become ornery. … Orneriness is often a highly effective defense mechanism against bossy people and bullies. …

One of the most striking characteristics of ornery people is that they don’t want to boss other people around any more than they want to be bossed around themselves. … The ornery man’s idea of liberty is the liberty to be left in peace, to tend to his own affairs, to pursue his business, make his home, raise his kids, without being told what to do or how to do it by other people.

Without question, orneriness fueled Donald Trump’s electoral victory — although I am not sure how natural libertarians will feel about their new president after he has governed a couple of years. Be that as it may, the live-and-let-live, leave-me-alone-and-I’ll-leave-you-alone impulse is a strong one in Virginia.  Natural libertarians skew toward Republicans and conservatives on issues relating to fiscal responsibility, lower taxes, less regulation but they lean toward Democrats and liberals on cultural issues such as gay rights and abortion. The Republican-Democratic duopoly offers no haven for natural libertarians.

A February 2016 Wason Center poll indicates how much of the population is up for grabs. Here’s how the Virginia electorate broke down by party loyalty:

Republican — 21%
Independent, leaning Republican — 20%
Independent — 16%
Independent, leaning Democrat — 14%
Democrat — 24%

More than half the electorate describes itself as independent to greater or lesser degree.  The Wason poll also provided this breakdown by liberal/conservative ideology:

Strong liberal — 5%
Liberal — 13%
Moderate, leaning liberal — 15%
Moderate, leaning conservative — 25%
Conservative — 23%
Strong conservative — 10%

Moderates outnumber both liberals and conservatives (although by a smaller plurality than independents outnumber Rs and Ds.) I would bet that if you queried most moderates and independents, you would find them to be natural libertarians. If the natural libertarians had a party that fully represented their priorities, it would dominate state politics.

Given the make-up of the electorate, I cannot help but wonder why the “Big L” Libertarian Party hasn’t made bigger gains in the Old Dominion. Robert Sarvis won about 6.5% of the vote in the 2013 gubernatorial election, a record, but he was running against duopoly-party candidates with high negatives: Terry McAuliffe and Ken Cuccinelli. It’s far from clear that a Libertarian candidate would fare as well in 2017.

One reason for Libertarians’ limited electoral success might be be that the party duopolists have stacked the rules of the game against third-party upstarts. Strict balloting rules compelling third-party candidates to gather 10,000 signatures to run for statewide office is one example. Gerrymandering safe districts for Republicans and Democrats is another.

A third explanation for limited Libertarian Party success in Virginia is the widespread perception that Libertarians are a fringe group of crackpots and dope smokers preoccupied with nutty ideas such as legalizing drugs, abolishing the Federal Reserve Bank, or eliminating the military. Many voters regard Libertarians as dreamy utopians with little inclination to engage in the nitty-gritty work of governing. I believe that view is unfair, but without question the view must be overcome.

To achieve electoral success in Virginia, Libertarians must identify issues that will gain traction with the huge number of “natural libertarians” out there and build a broad coalition of like-minded constituencies. They also must advocate a politics of the possible. Repealing the income tax, a fiscal impossibility in Virginia, is not an option. Libertarians have a lot of thinking to do. While news is slow during the holiday season, I will sketch out some ideas.