Relevant and even prescient commentary on news, politics and the economy.

More on Web Page Seizures

Earlier, I commented on the Justice Department seizing (pre-trial) a web site that has information on how to pirate X-Box and PlayStation games, and then redirecting visitors to a DOJ site. A ZDNET commentary has a bit more:

That’s why we should think twice before applauding this trend in police power. One reason is that the Justice Department’s privacy policy allows it to hand over information it collects from people visiting seized Web sites to “appropriate law enforcement officials” for criminal prosecution.

It’s possible to imagine a scenario where an innocent Web visitor becomes unfairly targeted by the Feds. It’s legal to browse the Web for information about illegal drugs and even legal to read about bypassing copy-protection technology (though under the DMCA, researchers writing such papers may have cause for concern). But in a newly security-conscious climate, the Justice Department may not be terribly sensitive to Americans’ First Amendment rights and may assume the worst about visitors to its collection of seized domains.

What’s more, the Justice Department is able to review the search terms that people type in before connecting to the seized site from search engines such as Google or AltaVista. That’s because Web protocols pass the search terms to the destination site in the Referer: header.


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If Only Nixon Knew you could do this with an Enemies List

In the too weird to not be true category:

Vanity Fair reported in the article that in 2000 [Michael] Jackson attended a voodoo ritual in Switzerland where a witch doctor promised that Spielberg, music mogul David Geffen and 23 other people on the entertainer’s list of enemies would die.


P.S. The title is only a reference to “Enemy Lists” and not meant to imply that Nixon wanted to kill anyone.

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Rate cut 1/4 point

To 1%, the lowest level since 1958:

NEW YORK (CNN/Money) – The Federal Reserve cut its key short- term interest rate Wednesday by a quarter percentage point to the lowest level in 45 years, expressing worry that the economy still isn’t strong enough to fight off deflation.

Because the rate cut came in at the minimum level that people expect, it was already largely priced into the stock market, so don’t expect to see much action there. It will help to keep finance rates around their current levels, continuing to prop up consumer durable goods and housing expenditures. Some of the effects will be attenuated by the fact that so many people expected a 1/2 point cut that those expectations will shift to expecting another 1/4 point rate cut at the next Fed meeting (in August)–so firms that might have borrowed now in response to a 1/2 point cut may choose to wait two months (for a second cut) before borrowing. On balance, it’s a “hold the course” cut that, given the current course, seems a little timid. On the other hand, the Fed doesn’t want to run out of bullets (it’s got four left now).


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Press Still Turning

Still slowly, but in ways medium and small (not yet big), the press is continuing to be less sycophantic towards the administration (see posts here, here, and the initial post here). Josh Marshall picks up on this phenomenon in this post [emphasis mine]:

Actually, in my Wednesday morning column in The Hill I said that there really is no new debate or new scandal. It’s really more that it’s suddenly become acceptable to discuss what everyone knew for the last year or so: that is, that the administration was willfully misrepresenting the evidence both on WMD and a purported link to al Qaida.

I keep harping on this point because if the press turns on Bush then Kerry or Edwards has a decent shot in 2004.


P.S. Yes, I left Dr. Dean out of the list of people with a chance in ’04. (That’s what the comments are for).

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Quotas and Metrics

Rehnquist made the argument that Michigan’s bonus point system is tantamount to a quota system, which was ruled unconstitutional under Bakke. Commenter Andrew wrote below that “There might be a distinction between quota or bonus-point affirmative action programs and a more subjective system, but I can’t see it.”

At first glance, there seems to be a substantial distinction: with a quota, a university does not know in advance how far down in the distribution of grades and test scores it will have to go to meet the quota. That is, under a quota, a university has to fill X slots with students from ethnic group Z, regardless of the academic performance of applicants from group Z. In contrast, under a bonus point system, the number of minorities admitted from each group can fluctuate from year to year, according to academic performance that year.

Moreover, consider the marginal white student—the one who was barely bumped because of affirmative action. Under a quota system, if the student does a little better, he could gain admission, but it would necessarily come at the expense of another white person, because the quotas bind. Under a bonus system, if the marginal white student had worked a little bit harder and gained admission, it could come at the expense of any student (i.e., at the expense of the lowest-scoring admitted student other than the student in question). So the bonus system is more flexible than a quota system and it’s a bit disingenuous to equate the two.

That said, there are a lot of applications every year, meaning that laws of large numbers apply. If a school’s Admissions Office has a target number of minorities to admit (a quota) in mind, they can readily infer what number of bonus points will achieve that target, give or take a few students. Metrics like Michigan’s can be mapped into quotas with a pretty narrow range of error, so it’s only “a bit” disingenuous.


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Slow News Day

Normal posting should be resuming now, but other than yesterday’s batch of Supreme Court rulings, news is pretty slow. Iraq is still a mess (see this one, also). The economy is still in bad enough shape that almost everyone thinks the Fed will drop rates on Wednesday. The only debate is whether the cut will be 1/4th or 1/2 a point–my guess is one quarter.


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Good News Bad News News

Actually, it’s on balance good news, at least compared to what the SCOTUS could have done: Affirmative action is constitutional. Using race-based bonus points is not. (Salon here and the NYT here). It was pretty easy to peg four of the votes on each side, and I feared that O’Connor would come out against, but I was wrong.

Now a university can’t use quotas (Bakke) and can’t use bonus points (today’s ruling), so the rule seems to moving towards something like “no quantifiable race-based advantage may be given to any racial group but subjective favoritism is fine and dandy”, which doesn’t really make sense, but has the potential advantage of not leaving a paper trail. If there is no “system” then the system can not be unfair and there will be no grounds for lawsuits.

What would a system with only subjective/non-quantifiable racial preferences look like? Teaching colleges already evaluate applications on a number of subjective dimensions (experience, leadership, teamwork, creativity) and many presumably already consider diversity in the way now sanctioned by the Supreme Court. Implementing such a system at the major state colleges (like the University of Michigan) will be much more difficult. I’m guessing here, but Michigan probably gets at least 20,000 applications per year. Due to the huge the numbers, large state schools use objective measures to determing admissions–e.g., Michigan’s infamous “formula” that takes into account GPA, class ranking, SAT score, whether the student is from certain poor areas of the state, and race. Switching to a qualitative system would be extremely costly for these schools.

The more likely outcome is that large schools will use quantitative measure based on GPA, class ranking, SAT score, and possibly a measure of the difficulty of the student’s high school, to set two thresholds. Students above the top threshold would be in; students below the bottom one would be out. Students landing between the two would be subjectively evaluated by hand, and in that process race could be a factor. This seems likely to give admissions officers more discretion over how and whether to weight race. I can’t decide if this is likely to be a good thing or a bad thing, but I’m leaning towards the latter. Not that I distrust admissions staff (I suspect they come from the ranks of educations majors and are on balance no less liberal than the population at large; likely they are more liberal). My fear is that universities can say “we consider race as a factor”, but they can never say how they do so–if they can articulate it, then it’s quantifiable, and therefore tantamount to quotas (Rehnquist’s logic). Any system that is constitutional under the new standards will surely be a morass of uncertainty. In general, as an activity becomes more costly and entails less predictable results, people and institutions engage in less of that activity. I don’t see a compelling reason why this will not apply to affirmative action, hence my pessimism.


Meanwhile, in the background I hear some jackass on CNN, his name may have been “Jeff Block”, doing interviews at the University of Michigan. His question for each minority he speaks to: “Are you here because of affirmative action?”

In other news, “A divided Supreme Court ruled on Monday that a Congressional mandate forcing the nation’s public libraries to equip computers with anti-pornography filters do not violate the First Amendment, even though it shuts off some legitimate, informational Web sites.” This is why the Democrats have to keep opposing, by any means necessary, Apellate Court nominees like Owens, Pickering, Estrada, and Pryor.

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In the News

See O’Reilly’s Online Spanking for some mocking of Bill O’Reilly by Kurtz, who quotes various bloggers. He manages to plug InstaPundit, Volokh, and Lileks, but no big lefties, unless you count Scott Rosenberg.

Katrina Leung, FBI employee and alleged double-agent, got bail today. If you didn’t already know it, there would be no way to tell that she was, until her arrest, a major player in Republican fundraising.

And whoever ends up as the Democratic candidate will need something other than prescription drugs and health care to blather about. The environment is a good topic for Democrats, particularly because it has a lot of appeal in the suburbs and higher income brackets. In an effort to point this out to the Democrats–who are unlikely to figure it out on their own, or possibly could figure it out but are afraid to say anything–the White House is redacting a forthcoming report on the environment.

Gone is any mention that the 1990’s are likely to have been the warmest decade in the last thousand years in the Northern Hemisphere. Gone, also, is a judgment by the National Research Council about the likely human contributions to global warming, though the evidence falls short of conclusive proof. Gone, too, is an introductory statement that ‘Climate change has global consequences for human health and the environment.'”


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I’ll be traveling for the next few days, so posting might be light. In the meantime, I offer this for your consideration. It’s a graph of Federal Revenue by year, on a deflated and per capita basis. To derive this, I took annual Tax Revenue (all sources) for 1980-2000, converted to constant 1996 dollars using the GDP deflator rather than the CPI, and then divided the constant dollar numbers by the U.S. population in each year. This should represent federal revenue over time, after controlling for inflation and population growth.

A few observations leap out: (1) Revenue declined after the 1981 tax cut. (2) Revenue did start increasing after 1983 (reflecting two things: first, some taxes were raised in 1983 and after; second, 1983 was when the first year shown in the graph without a recession. (3) After Clinton raised taxes, in 1993, federal revenue took off. This partly reflects the boom, but that didn’t really get into full swing until 1996.

So, on balance, it looks like when you raise federal tax rates, federal tax revenue goes up (at least for rates under 50%), and vice-versa. Stunning. (click to enlarge)


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