Stock

Marc Joffe

Last week, Representative Sam Graves (R‑MO) and Senator Ted Cruz (R‑TX) sent a letter to Transportation Secretary Pete Buttigieg asking some pointed questions about the California High‐​Speed Rail project, which continues to absorb billions in federal funds without producing meaningful results. If the secretary fully responds to this congressional inquiry, the public will have a much better understanding of this troubled project.

The letter could be followed by a congressional hearing because Representative Graves is the chair of the Committee on Transportation and Infrastructure. Senator Cruz is the Ranking Member of the Committee on Commerce, Science, and Transportation.

Today, the California High‐​Speed Rail Authority continues construction work in the state’s Central Valley although it does not have sufficient funding to link the inland cities of Merced and Bakersfield, let alone build the full line which was supposed to connect San Francisco, Los Angeles, and Anaheim. Today, the prospect of speeding from the Golden Gate to the Magic Kingdom on a 220‐​mph train is about as fantastical as anything creators at Disney could imagine.

The state and federal governments continue to provide enough money to keep the project going without providing a path to completion. The strategy appears to be one of keeping the project alive in hopes that Congress and/​or California taxpayers will provide a new financial windfall that will get the project to the finish line.

This is problematic for those outside California who want funding for their transportation projects. The 2021 Infrastructure Investment and Jobs Act provides a finite amount of funds for projects nationally, so money “invested” (or perhaps squandered) on the California high‐​speed dream is unavailable for projects elsewhere. Because Amtrak and rail agencies in other states are seeking federal funds, their projects are probably also uneconomic, but perhaps less wasteful given California’s high construction costs, stagnant population, and politicized planning process.

One question Graves and Cruz are focusing on is ridership on the Merced to Bakersfield segment, if and when it is completed in the early 2030s. These cities are already served by intercity rail via Amtrak’s San Joaquins service. Replacing the relatively slow Amtrak service with 171 miles of high‐​speed rail would undoubtedly attract some new riders. But because Central Valley cities lack highly concentrated downtowns and dense local transit networks, one wonders how many travelers will ditch their cars to save 60–90 minutes of travel time on the train.

In its 2023 Project Update Report (on page 32), the Authority estimated that 2.3 million riders would use the new segment annually once it is up and running, A more detailed ridership forecast published earlier this year does not update this figure and instead provides ridership estimates for a network of bus and rail services intended to link Silicon Valley and the Central Valley when the high‐​speed rail service starts. Hopefully, stepped‐​up congressional attention will unlock the data needed to better understand and audit the Authority’s ridership numbers.

Brent Skorup and Laura Bondank

Todd and Heather Maxon live on five acres of land in northern Michigan and Todd fixes up old cars on the property in his spare time. Todd’s hobby, and their Township’s regulation of it, has resulted in a major legal fight that has gone before the Michigan Supreme Court twice in recent years. In a May 2024 decision, Long Lake Township v. Maxon, the Michigan Supreme Court issued a major ruling against the Maxons, holding that when the government unconstitutionally gathers evidence in regulatory investigations, in some cases that evidence can still be used in court.

The issues started years ago when to avert a citation from the Township, the Maxons agreed to cap the number of immobilized cars on their property. Around 2018, however, the Township investigated tips that Todd had more cars than the agreement allowed. The Township couldn’t prove a violation with a visual inspection from a public roadway, so municipal officials hired a private drone company to fly the drone in and around the Maxon property to gather evidence. After doing this on three separate occasions—each time without a warrant—the Township had enough video and photographs to bring a civil zoning action against the Maxons.

Rather than accept the citation, the Maxons sued in state court and moved to exclude all evidence resulting from the warrantless drone surveillance. In criminal cases, judges generally exclude all evidence gathered unconstitutionally—the “exclusionary rule.” The rule incentivizes law enforcement to act legally and get warrants. So, the Maxons argued that the Township violated the Fourth Amendment, which protects against “unreasonable searches,” and the evidence should be excluded. An appeals court agreed and ruled the drone footage inadmissible.

Unsatisfied with this outcome, the Township petitioned the Michigan Supreme Court for review. In 2022 the Supreme Court vacated the Court of Appeals’ opinion and sent the case back, asking them to address the issue of “whether the exclusionary rule applies to this dispute.”

Unfortunately, the Court of Appeals did not side with the Maxons the second time. The court held that the exclusionary rule did not apply to the Maxons’ case because it is a civil—not a criminal—matter. This time, it was the Maxons who petitioned the Michigan Supreme Court for review, asking them to decide two important questions: Was the Township’s warrantless drone surveillance of their property an unreasonable search in violation of the Fourth Amendment? And if so, does the exclusionary rule apply?

The Cato Institute, along with the Rutherford Institute, submitted an amicus brief arguing that the drone surveillance was an unreasonable search and that the evidence should be excluded. This month, however, the higher court agreed with the appeals court: the exclusionary rule does not apply in zoning cases like the Maxons’. Strangely, it declined to address whether the drone search was “an unreasonable search,” a relevant consideration in its exclusionary rule analysis.

The Michigan Supreme Court said that the exclusionary rule applies in criminal investigations but only in certain civil investigations. In civil cases, “it is clear that application of the exclusionary rule ‘involves weighing the costs and benefits in each particular case.’” For this case, the calculation was simple: there were no benefits to exclusion in this case, the court said.

Finding no benefits to exclusion in this case is odd because the court declined to rule whether the search was unconstitutional. If the court had found the search was unconstitutional, there clearly would be a benefit to exclusion: the Maxons would have their Fourth Amendment rights protected via an evidentiary benefit at trial.

The court added, “it is unreasonable to believe that excluding the photographs and video would deter future misconduct by law enforcement or any other actor in any way.”

However, if the court had instead excluded the evidence here, it would have put all state officials on notice that evidence acquired in civil investigations without a warrant would be inadmissible. It seems self‐​evident that such a holding would deter regulators from engaging in warrantless searches.

In the end, the Maxons lost. The videos and photos of their property, even if gathered unconstitutionally, can be used against them. So, when regulators and law enforcement officers gather evidence of civil violations—like code enforcement, tax compliance, and domestic disturbances—without a warrant, is that evidence admissible in court? The Michigan Supreme Court seems to say—it depends. The decision is not clear nor protective of residents’ privacy expectations. Unfortunately, it seems likely to invite more warrantless searches from Michigan regulators and law enforcement officials.

Scott Lincicome

The recent Wall Street Journal article, “Meet the Shirt Maker Who Loves U.S. Tariffs,” is a modern (and frustrating) version of French economist Frédéric Bastiat’s classic parable of the broken window. It praises the “seen” benefits of US apparel tariffs—the handful of American manufacturers whose products have “again become competitive in the global marketplace”—while totally ignoring their many “unseen” costs.

Most obviously, the article refers to the higher prices that American consumers will now pay for clothing as merely something US importers “say” might happen, when in fact we know from recent experience that these costs are real and significant.

According to the US International Trade Commission, for example, the “Section 301” tariffs on Chinese apparel imports—the very tariffs at issue here—increased the price of Chinese apparel by 14.5 percent, the price of US apparel by 3.1 percent, and average US apparel prices overall by 4.3 percent. That’s an invisible tax of more than $3.5 billion in 2021 alone—one that was disproportionately paid by lower‐​income American consumers and that constituted money that couldn’t be spent on other, more productive US enterprises.

Also unseen is the fact that, again per the ITC, the China tariffs resulted in only a modest (6.3 percent, or about $770 million) increase in American apparel production that same year, because US consumption shifted not to American‐​made clothing but other import sources (a 25.2 percent increase in 2021). Overall, therefore, the US economy has suffered yearly tariff‐​related losses more than four times as large as the gains the article cheers—a miserable result that’s anything but surprising given that the same commission in 2017 found that the removal of earlier US apparel tariffs would increase net US welfare by $2.4 billion.

And for what? Suits, t‑shirts, and jeans have no national security implications, so economic losses from forcing their production onshore are not “strategically” justifiable (non‐​China imports notwithstanding). Production jobs in the domestic industry pay as little as $11/​hour and only a few dollars more in New York City, where the Journal article’s chief protagonist is located (and where fast food workers make almost as much). The manpower and other finite resources directed to tariff‐​protected industries also now can’t be used for other, more productive business operations in the region—another unseen cost of protectionism.

Call me a heartless globalist if you must, but the US government shouldn’t be in the business of regressively taxing the clothing purchases of Americans still reeling from inflation, all to support—at a substantial net loss—relatively low‐​paying apparel jobs in the Big Apple. It’s a bad policy, and certainly nothing for a newspaper to cheer about.

Krit Chanwong

On April 22, 2024, the Center for Medicare and Medicaid Services (CMS) released a new rule that purportedly “enhances quality and fiscal and program integrity standards.” Unfortunately, this rule will likely increase Medicaid expenditures without achieving most of its stated goals.

Managed Care and “State‐​Directed Payments”

Most of the CMS’s new rules contain regulations on Medicaid managed care and state‐​directed payments. Explaining these terms will be essential in understanding the new rule’s shortcomings.

In the early 1980s, states began contracting with insurance companies to provide Medicaid care. This new delivery system, called “managed care,” was supposed to reduce the growth of Medicaid expenditures. By 2011, most states had adopted the system. Figure 1 shows that such cost savings did not occur. 

In managed care, states pay for services through a per‐​member monthly premium. This replaced an older delivery system called “fee‐​for‐​service,” whereby Medicaid paid providers for each specific service.

The switch from fee‐​for‐​service to managed care led to major problems for states. Generally, in a fee‐​for‐​service setting, Medicaid pays lower than Medicare and private insurance. To compensate, state Medicaid agencies provided hospitals with additional cash on top of their Medicaid patient revenues. The federal government forbade the sum of these additional payments and base Medicaid rates from exceeding what Medicare would have paid for the same services. As such, these payments came to be known as the “upper payment limit” (UPL) payments.

States could finance UPL payments using “hold‐​harmless arrangements.” As described in Figure 2, these arrangements exploit the Federal Medical Assistance Percentage (FMAP) to gain more money from the federal government. States liked hold‐​harmless arrangements, as it allowed them to receive more federal funds. Providers liked them because they would receive more revenue through increased reimbursement rates.

Historically, states with managed care could not make UPL payments as managed care payments were made through premiums and not by service. This meant that switching to managed care would have closed off hold‐​harmless arrangements.

The situation changed in 2016 when the federal government allowed state Medicaid agencies to direct additional provider payments through contracted insurance companies. These payments came to be known as “state‐​directed payments” (SDPs).

From 2017 to 2023, SDP expenditures grew from $10 billion to $69 billion, representing a compound annual growth of 38 percent. Multiple organizations, like the GAO and Medicaid Access and Payment Commission (MACPAC), have expressed concern about this rapid escalation. A large portion of the CMS’s new rule was written in response to these concerns.

The CMS’s New Rules

The first major SDP regulation found in the CMS’s new rule sets “a regulatory limit on the total payment rate using the ACR (average commercial rate) for inpatient hospital services, outpatient hospital services, qualified practitioner services at an academic medical center, and nursing facility services.”

The CMS believes that this reform will increase Medicaid expenditures, stating that “at least two thirds of the SDP submissions intended to raise total payment rates up to the ACR.” The CMS sees some value to this, claiming that rate increases will incentivize more providers to participate in managed care networks, thus increasing Medicaid accessibility.

The CMS’s claim is tenuous. It is unclear whether increasing Medicaid reimbursements improves Medicaid accessibility. In fact, a 2020 survey of physicians’ Medicaid acceptance found that the main barrier for accepting new Medicaid patients was capacity. Reimbursement rates were a tertiary concern. Moreover, a 2005 study found that the “effects of Medicaid fees on Medicaid acceptance are substantially lower in areas with high Medicaid managed care penetration and for physicians who practice in institutional settings.” Any rate increases, especially through managed care, are unlikely to increase accessibility.

In fact, increased Medicaid rates may also increase healthcare prices for other consumers. North Carolina’s SDP program increases Medicaid prices to 226 percent of Medicare rates. Much of this increased revenue goes to hospitals. According to Johns Hopkins professor Ge Bai, hospitals can then use “SDPs to subsidize and bolster physician practices they own, gaining a competitive advantage over other physician practices.” Acquisition lowers competition, which directly reduces the ability for insurers to negotiate lower prices for their members.

The CMS will also require states to “ensure that participating providers in an SDP arrangement attest that they do not participate in any hold‐​harmless arrangement for any health care‐​related tax.” (This regulation will not take effect until 2028.) The CMS also explicitly requires all SDP financing to conform “with all Federal legal requirements for the financing of the non‐​Federal share.”

The CMS believes that this regulation will improve program transparency and end hold‐​harmless arrangements.

However, seeing how this new regulation would increase transparency is hard. The CMS, for one, does not require these attestations to be made public. They will only be reviewed by government bureaucrats, who are not necessarily the model of transparency. Moreover, the hold‐​harmless attestations are simply that: attestations. This regulation does not change the underlying incentives for providers and states to enter into hold‐​harmless deals.

Moreover, making SDPs conform to federal regulations will probably not end hold‐​harmless arrangements. In general, federal regulations ban hold‐​harmless arrangements. An exception is made if the hold‐​harmless arrangement costs less than six percent of the provider’s revenues. A 2021 MACPAC review found that the vast majority of states’ arrangements cost less than this level. This rule will most likely lead states to restructure their hold‐​harmless arrangements to fit the six percent loophole.

Time for Congressional Action

The CMS’s new regulations are unlikely to accomplish any of its goals. Increasing Medicaid reimbursement rates is unlikely to improve accessibility. It may even harm non‐​Medicaid patients. Making providers sign attestations, but not making the attestations public, will add another layer of bureaucracy. And current federal regulations are not robust enough to prevent the rise of hold‐​harmless arrangements. These policies also have a high price tag of $50–220 billion over the next decade.

Congress needs to correct the careless policymaking of CMS bureaucrats. Closing the six percent loophole and other sensible Medicaid financial reforms may reduce Medicaid expenditures by $1.4 trillion over ten years. However, Medicaid has become too complicated. Congress should go further and consider turning Medicaid into a block grant program. My colleagues Chris Edwards and Michael Cannon have written extensively on the fiscal benefits of block‐​granting Medicaid.

Walter Olson

Free‐​expression advocates won a big victory at the Supreme Court in yesterday’s National Rifle Association v. Vullo, with Justice Sonia Sotomayor writing for a unanimous court with Justices Neil Gorsuch and Ketanji Brown Jackson concurring.

Brent Skorup, legal fellow in the Cato Institute’s Robert A. Levy Center for Constitutional Studies, responded with this statement:

The Supreme Court has been clear that a government official cannot directly or indirectly coerce a private party to punish disfavored speech on the government’s behalf. Today the Court unanimously reaffirmed that principle.

Acting on a tip from gun‐​control advocacy groups, in 2017 New York’s Department of Financial Services began investigating insurance companies who offered insurance products to NRA members. New York regulators and Governor Cuomo, via meetings with and emails, statements, and guidance to those insurers, signaled that the regulators would focus their enforcement and investigations on insurers who continued to provide insurance products to the NRA and similar “gun promotion organizations.” Insurers discontinued services to NRA members and the NRA sued for violation of the organization’s First Amendment rights.

The Supreme Court today reversed the Second Circuit Court of Appeals and held that the NRA plausibly alleged violation of the organization’s free speech rights. New York regulators’ actions were not “examples of permissible government speech” and were not “legitimate enforcement action.” The Court held that the NRA’s allegations, if true, were coercive threats aimed at punishing the NRA’s speech in violation of the First Amendment. The case is remanded for further proceedings. The Court reached the correct result and it’s encouraging to see a unanimous affirmation of an important precedent that the government cannot use its power to indirectly chill the speech of private parties and government critics.

Writing with David Rifkin in the Wall Street Journal in 2022, Cato adjunct scholar Andrew Grossman said that in its earlier decision upholding New York’s actions, the Second US Circuit Court of Appeals had “provided a road map for officials to circumvent the First Amendment’s protection for freedom of speech.” It was that Second Circuit ruling that the high court vacated and remanded yesterday,

In January, Andrew Grossman and I did a Cato Podcast with Caleb Brown previewing the case. On the podcast, The Reload, Cato adjunct scholar Robert Corn‐​Revere examined the stance of the US Justice Department, which weighed in on behalf of a somewhat narrower interpretation of First Amendment protection.

“The amusing part,” I wrote in 2020, “is that the public officials themselves are helping to provide the basis for these rulings by tweeting and speechifying about how much damage they intend to do the NRA.” I cited cases in California in which responsible officials had been even more candid than had been New York Gov. Andrew Cuomo about their motivations. And a Cato briefing paper last October by Andrew Grossman and Kristin Shapiro put the case into context of other efforts by government officials to jawbone or simply coerce private parties into constricting others’ speech.

Romina Boccia

This May, I had the privilege of hosting a Jeffersonian dinner with the speakers of the Cato Institute Social Security Symposium: A Global Perspective, where we delved into the experiences and policies that shape our views on the government’s role in retirement provision.

Watch the Symposium

A Jeffersonian dinner is characterized by being off‐​the‐​record (following the Chatham House Rule), guided by a set of targeted questions and clearly established norms, and moderated by a skilled facilitator. A well‐​run Jeffersonian dinner will lead to every participant learning something new through a generative ideas exchange. The goal is not to debate or persuade, but to shed new light on an issue and understand different perspectives more deeply. Our May dinner was guided by the following questions:

What personal or professional experience has most shaped your perspective on the role the government should play in people’s retirement?

What political, technical, or strategic key lessons should the US draw upon to address its dual challenges of an aging population and the unsustainable growth in old age benefit programs?

How can we shape the conversation around retirement program reform to spotlight its potential and highlight possibilities for positive outcomes in a way that sparks enthusiasm for transformative change?

Our discussion was rich and varied, touching on personal experiences that have influenced our perspectives: from the impact of grandparents’ financial situations, to witnessing old‐​age poverty, to researching the accumulation of Boomer wealth, to calculating our personal expected Social Security benefits, to being confronted with the skepticism of younger generations about receiving any benefits at all given system financing shortfalls.

We explored how behavioral finance, including tax incentives and compulsory savings, plays a role in retirement planning. Key questions arose about the fundamental purpose of Social Security: Are we insuring against poverty, providing replacement income, or combating myopia in retirement planning? We also discussed the often‐​overlooked geographic aspects, such as people moving to lower‐​cost areas and the role of Social Security in enabling them to stay in their communities despite rising property taxes.

On the policy front, we examined the total costs of pension systems and how much of a country’s GDP should go toward subsidizing consumption among older individuals, regardless of need. We debated the merits of pre‐​funding pensions versus relying on taxes collected by current workers (as is done in pay‐​as‐​you‐​go systems like Social Security), and how the size and eligibility criteria of benefits impact economic growth by increasing or decreasing labor supply.

Should benefits be pre‐​funded with taxes collected and set aside for retirees and saved in investment accounts they own and control? Or should most people be free to save and invest for retirement as they see fit with government programs acting as a basic backstop against poverty in old age?

Should benefits be tied to average wages or some measure of the poverty level rather than individual earnings?

Would increasing the retirement age and reducing the generosity of benefits encourage more work and savings?

Other thought‐​provoking topics included the efficiency of payroll taxes versus income taxes, the potential political and economic pressures of funding government retirement programs through general revenues, and the complexities brought about by actuarial calculations and what incentives factor into actuarial judgement calls.

We pondered how to make retirement program reforms politically feasible, possibly through bipartisan accords that transcend electoral politics. We also considered different international approaches to Social Security defaults, such as benefit cuts in the US when promised benefits exceed payroll tax collections, automatic tax increases in Germany, and Sweden’s balanced approach of reducing benefits and changing policies to boost growth. How do policy defaults shape political negotiations and influence legislative outcomes?

Ultimately, our discussions emphasized the importance of agreeing on facts and consulting longitudinal household surveys to better understand financial behaviors over peoples’ lifetimes. This can inform whether public benefits need adjustments, including deterring over‐​saving for retirement due to health uncertainty with long‐​term care supports and annuitization. We concluded by reflecting on FDR’s words: “We can never insure one hundred percent of the population against one hundred percent of the hazards and vicissitudes of life, but we have tried to frame a law which will give some measure of protection to the average citizen and to his family against the loss of a job and against poverty‐​ridden old age.” What’s the best way to uphold this promise without undermining the economic and financial future of the next generation?

This dinner left us inspired to seek transformative change in how we approach Social Security, with a commitment to setting clear system goals, learning from other countries informed by our nation’s unique history, and finding collaborative paths to achieve reform.

The symposium speakers built on this discussion during our panel sessions the next day at the Cato Social Security Symposium: A Global Perspective. I invite you to watch the video of our discussions if you haven’t done so yet.

Travis Fisher

The Inflation Reduction Act (IRA), the landmark climate law passed in 2022, offers energy‐​related subsidies for a variety of activities. Many of the IRA’s energy subsidies, such as tax credits for electric vehicles and green hydrogen production, are slated to end in the year 2032. Thanks to new guidance from the Internal Revenue Service (IRS), however, taxpayers may be on the hook indefinitely for tax credits for electricity production and energy storage. These subsidies have numerous bad effects that I’ve cataloged here and could end up costing $3 trillion or more.

The IRA’s longest‐​lasting energy subsidies—investment tax credits for energy storage and production tax credits for low‐​greenhouse gas (GHG) electricity production—have no fixed expiration date or spending cap. Instead, these tax credits only go away when the Treasury secretary determines that the US electricity sector has reduced its GHG emissions to 25 percent of 2022 emissions (or lower).

The IRS’s New Guidance

Under the new guidance, the IRS says the Treasury secretary must confirm that GHG emissions targets have been met by referencing two different data sets, each from a different federal agency, and each using different methodologies. Only when both sets of data—one from the Environmental Protection Agency (EPA) and one from the Energy Information Administration (EIA) within the Department of Energy—show that GHG emissions levels have fallen to or below 25 percent of 2022 levels will the last of the IRA subsidies begin to phase down.

The two data sets nearly agree on the 2022 emissions level. According to the IRS, the EIA data set establishes a 2022 baseline level of power sector emissions of 1,685 million metric tons (MMT) of CO2, whereas the EPA data would establish a baseline of 1,613 MMT of CO2‐​equivalent GHGs. Hence, the targets of 25 percent of each would be approximately 421 MMT CO2 and 403 MMT CO2‐​equivalent (CO2‑e). I do not view such a discrepancy as a showstopper.

The real trouble begins when we ask why the end of the IRA subsidies should depend on meeting a future standard—say, 403 MMT CO2‑e—under both a CO2‐​based and a CO2‐​e‐​based metric. Notably, CO2‑e incorporates other GHGs such as methane (CH4) and nitrous oxide (N2O), which have estimates of global warming potential (GWP) that are 28 and 265 times higher than CO2, respectively.

Source.

Perhaps my concern is premature, but there are many ways the EPA could abuse its new discretion. For example, imagine it’s the year 2045 and the CO2 target has been met according to EIA data. What if the EPA suddenly discovers new methane and nitrous oxide emissions that it attributes to the power sector? With estimates of GWP 28 and 265 times higher than CO2 (see table above), any adjustment to those data would have a large impact on the calculation of the CO2‑e metric and could delay the phase‐​down year for IRA subsidies.

If the above scenario seems far‐​fetched, consider the shift in the way advocates discuss the role of natural gas in reducing GHG emissions. Initially praised for outcompeting the coal industry and reducing CO2 emissions from the power sector, environmentalists later framed methane leakage as such a large problem that any CO2 emissions reductions from natural gas were more than offset. Natural gas became “as bad for the climate as coal.”

When faced with the end of the IRA subsidies, could favored corporations and environmentalists—the bootleggers and Baptists of the IRA—find new ways to keep the electricity sector’s CO2‑e emissions from hitting the phase‐​down target? Odder things have been documented by economists who study public choice.

Conclusion

Like the IRA itself, the recent IRS guidance is bad news for the American people—it deepens the problem of unlimited IRA subsidies and enables executive agency overreach. The IRA’s energy tax credits should not exist, but if they must, then the administration should establish an either/​or structure for competing data sets where hitting GHG targets under just one methodology will end the subsidies. Instead, the IRS’s new guidance seems designed to maximize taxpayer liability by keeping IRA subsidies around for as long as possible.

Colleen Hroncich

While the small Christian school her children attended was amazing, Angie Nippert felt a restlessness in her heart when she dropped them off each day. She didn’t know what it was, and the busyness of life kept her from investigating further. But eventually she and her husband decided they just didn’t want that life anymore, so they told their kids they were leaving the school.

“We had no idea what we were going to do, but we knew we needed something different,” she says. “And it was right around that time that we found all these resources around alternative education. My husband and I both are kind of researchers at heart, so we both dug deep and really started exploring.”

The book Courage to Grow by Acton Academy co‐​founder Laura Sandefer had a huge impact on Angie and her husband. They considered moving to be closer to an Acton Academy or starting their own. Then came the pandemic. “When COVID hit, it gave me confidence to say we can do this—we can homeschool,” Angie recalls. She realized she could use the same software programs they’re using at school right in her home for free.

Angie appreciated that having her kids at home let her see how they were wired when it comes to education. One liked learning directly from a teacher. Another learned best through projects. “We were able to see all these differences and nuances in our children, and we were like, ‘let’s try this next year,’ she says. “So we did. We pulled our kids, and our home became our school. We invited a couple of other families to join us. And it was at this point, in a very limited capacity, that we were able to try some of these ideas that we had read about but we weren’t able to implement.”

In December 2022, Angie learned about the KaiPod Catalyst program. She applied and was accepted into the program. In January 2023, she started working to create The Gathering Learning Studio. Angie explains that Gathering differs from a microschool. “We don’t do any direct instruction. Parents are homeschooling, so they are the official educators on record. We are providing the supplemental resources. Parents can choose two, three, or five days a week currently to come to the studio,” she says. “The parents pick the curriculum; we just support whatever curriculum they choose. And I help them with that. A lot of these families have never homeschooled before, and that’s such an overwhelming process. I try to help them as much as possible to figure out what might be good curriculum for them.”

Angie hired a learning coach who spends the day with the students. The mornings are spent on independent academic time where the students work on their individual lessons. The learning coach can answer questions, help them if they get stuck on a math problem, encourage them, and assist with time management.

Entrepreneurship is a big focus, so each year the kids will start their own business. “They have to decide: What are they going to do? Is there an end product that somebody’s going to pay for? How are they going to find the supplies—good supplies in a cost‐​efficient way?” Angie says. They learn about profit and loss, marketing, and other business skills. Then they set up booths at a citywide garage sale, and it’s a fantastic learning experience. Some had a lot of joy because people were buying their products. Others had disappointment when people stopped to look but didn’t purchase anything. But that was also a learning experience because entrepreneurial ventures don’t always succeed.

Afternoons at Gathering are for project‐​based learning. For the first project, they visited an escape room and learned how the owner creates the games, puzzles, and challenges for the participants to do in the escape room. Then the students had six weeks to work in small groups to create their own escape rooms. At the end, they had an exhibition night, and the people from the local escape room went through the students’ and gave them feedback. Angie says the kids learned game design and soft skills like collaboration, conflict management, time management, and how to set and persevere through the goals.

The second project focused on graphic design where they brought in someone who works in advertising and marketing. She led the students through a four‐​week session around how to create a brand. She taught them about how to use Canva, what colors go together, how to pick the colors, how to pick the fonts. And then they had to create a business logo and a marketing branding page that they would use for their business—real or fictitious.

Angie is clearly onto something. The Gathering has doubled in size and is close to needing a waitlist at the current location. She’s secured a new location that will be available in late fall after renovations are complete. That “will give us triple the amount of space we currently have, allowing us to open up registration to even more families,” she says. “We are also starting an option where parents can choose to have us pick their child’s academic curriculum, or they can continue to pick curriculum for their children. We are really starting to see momentum with families who are not having a good experience in traditional school and would like a more personalized, self‐​paced option of learning vs. just homeschooling families.”

Angie’s long‐​term vision is to have The Gathering be a true learning studio‐​type atmosphere with a student lounge that’s like a co‐​working space where they can get their work done. But there would also be little creative spaces throughout the studio where students could dive deep. For example, there could be a filming or podcasting studio, a crafting room, a woodworking space. “Areas where students can really explore, practice, hone those potential employable skills that could not only get them a job now, but could carry them through if that’s something that they find a lot of passion in,” she explains. She’d love to be able to open those spaces to the public for workshops as well so others can experience that type of learning.

Thomas A. Berry and Brent Skorup

Law enforcement officials around the country increasingly pressure criminal suspects, after arrest, to submit to continuous real‐​time location tracking. This invasive pretrial release monitoring practice is typically accomplished by attaching a GPS device to a suspect’s ankle. Prosecutors have defended location tracking as a beneficial alternative to keeping high‐​risk suspects in jail in the weeks and months between arrest and trial.

The City and County of San Francisco is one jurisdiction that uses such electronic monitoring. However, the county does not limit the use of its location tracking data solely to its own jurisdiction. Among the conditions the county sheriff enforces, suspects who accept electronic monitoring must also allow the sheriff to capture and share their location information with other law enforcement agencies across the country.

Three men who were charged with criminal offenses and subjected to San Francisco’s electronic monitoring for months objected to these surveillance and data‐​sharing conditions. They sued, alleging violations of their Fourth Amendment rights. And in February 2024, a federal court granted their request for a preliminary injunction and prevented the sheriff from sharing the GPS tracking information of any suspect in the pretrial monitoring program.

The government appealed to the Ninth Circuit in Simon v. San Francisco, asking it to reverse the lower court’s decision and reinstate the GPS monitoring program and conditions. Now Cato has filed an amicus brief, joining the Electronic Frontier Foundation and law professor Kate Weisburd to urge the Ninth Circuit to affirm the lower court’s decision.

The Fourth Amendment protects Americans’ right to be free from unreasonable searches. As our brief explains, people on pretrial release have not been convicted of a crime and do not relinquish their reasonable expectation of privacy in their location and movements. Location data reveal sensitive and private information about people, such as their movement within their own home or their visits to a doctor’s office, union hall, or house of worship. Therefore, the use and sharing of that location data must be strictly limited.

Our brief shows that there are two major Fourth Amendment problems with the sheriff’s electronic monitoring program. First, the sheriff shares comprehensive geolocation data with other agencies in a way that violates the program participants’ reasonable expectation of privacy. Second, the sheriff performs and shares the results of reverse location searches that reveal which program participants were in a particular location during a designated period. These reverse location searches are constitutionally deficient because they are not sufficiently particularized and are akin to the general warrants that the Fourth Amendment was intended to prohibit.

Our brief highlights these constitutional problems with San Francisco’s pretrial release monitoring program and urges the Ninth Circuit to affirm the district court’s decision granting the plaintiffs’ preliminary injunction.

David Inserra

In the United States, it is not uncommon to hear the refrain “hate speech isn’t free speech,” often for the speaker to be corrected that yes, free speech includes speech that many may find hateful or offensive. But in the recent debate over whether to create a regulator of online speech and otherwise expand speech restrictions, the Canadian justice minister unabashedly proclaimed, “Free speech in this country doesn’t include hate speech.”

Recently in Australia, the eSafety Commissioner ordered social media companies to remove videos of a terrorist attack. But the eSafety Commissioner went beyond its usual demand—instead of ordering the videos to be blocked only in Australia, it ordered that they be completely removed so that no users in the world could see them. X sued the eSafety Commissioner and even drew the attention of US free speech organizations, including the Foundation for Individual Rights and Expression (FIRE) and the Electronic Frontier Foundation (EFF).

While Americans often share a certain kindred spirit with other advanced democracies of the Anglosphere, it unfortunately does not extend to our legal treatment of disfavored speakers and speech. These recent incidents and proposals should remind free‐​minded people everywhere that giving the government greater control over their speech is dangerous. More than that, they should inspire Americans to stand up for our constitutional order’s truly liberal view of expression as nations around the world vie for control over expression online.

Looking first at Canada, Bill C‑63 would create a new safety commission with significant powers to regulate and investigate social media companies. Similar to Europe’s Digital Services Act, this bill makes a host of specific and vague demands of social media companies, such as requiring companies to adequately “mitigate the risk that users will be exposed to harmful content,” defined as everything from nonconsensual sexual content to content that “foments hatred.” Like the Digital Services Act, it also threatens large punishments of up to 6 percent of global revenue for companies that fail to meet these regulations.

On top of this new online speech bureaucracy, the bill also ramps up online and offline hate speech laws. For example, hate crimes would become their own crimes that could be charged separately from other normal crimes. Existing hate speech laws would have their punishments increased from two to five years for various statements that incite or promote hatred against an identifiable group, while “advocating genocide,” however terrible that may be, will increase from five years in prison to a lifetime sentence. The bill would also allow private Canadians to seek what are effectively orders of protection against someone targeting them with hate speech and to pursue private civil complaints with penalties of up to $50,000 (Canadian).

These changes will end up stifling the free speech of average Canadians and give the government more leverage to pressure and demand social media companies to do its bidding or that of its political appointees at the Digital Safety Commission.

And they can look down under to see what happens when democracies empower speech bureaucracies. The Australian eSafety Commissioner has been demanding X to remove content that merely shows a terrorist attack in Australia. Now, normally, many platforms would respond to a lawful order of this sort, and if it didn’t violate their rules, they would simply block it in the country issuing the legal order. But the eSafety Commissioner went further and demanded that the content be removed from the platform entirely. Users around the world wouldn’t be able to see the content because the Australian eSafety Commissioner said so.

This idea that Australia’s laws should govern what every person on the internet is allowed to see is the dream of every censor and authoritarian state. Dictators of every stripe would love to invoke this precedent by demanding internet platforms fully remove content their regimes find harmful. Even the bishop who was attacked by the terrorist said that such censorship is wrong. And so, X is fighting the eSafety Commissioner in court.

The negative impact on speech, both domestic and international, that came from this censorship even drew the attention of the US free speech organization FIRE and the internet freedom organization EFF. According to local news, both organizations “pulled off a rare legal manoeuvre” in this case and were granted the right to represent international speech interests in the Australian courts.

Even beyond this case, the eSafety Commissioner is pushing for greater censorship of political speech. In March, it wrote a letter to the Canadian activist Billboard Chris demanding that he remove his X posts that criticize the appointment of an Australian trans activist to a World Health Organization panel. The eSafety Commissioner also demanded that X remove the content, which it appears to have geoblocked in Australia pending legal litigation.

And as I’ve mentioned before, Australia has been contemplating expanding its speech restrictions by empowering government bodies to regulate misinformation online. According to Freedom of Information Act requests, they plan to allow the current government to direct and specify the terms of an investigation into misinformation on platforms. The Australian government’s own human rights council said the proposed measures “risk undermining Australia’s democracy and freedoms.”

While still a far cry from the tyranny of George Orwell’s Big Brother, these existing and proposed Australian and Canadian speech codes and bureaucracies are lauded by repressive censors and pave the way for greater suppression of core civil and political rights. Without a strong First Amendment to protect their expressive rights, Australians and Canadians must remember the importance of protecting disfavored speech and the dangers of empowering the government to remove such speech. And it should redouble Americans’ commitment to laws and culture that value an expansive and bold view of expression.