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Walter Olson

The Supreme Court today hears oral argument in Acheson Hotels v. Laufer, in which it will decide whether a self‐​appointed Americans with Disabilities Act “tester” has Article III standing to challenge a place of public accommodation’s failure to provide disability accessibility information on its website, even if she lacks any intention of visiting that place of public accommodation.

The constitutional breadth of Article III standing aside, the case is one that Congress could have long ago have defused simply by clarifying that a consumer who lacks genuine intent to patronize a business, or who could have gotten a defect in accessibility fixed on simple request to the business, has not suffered a cognizable legal injury from the problem.

In the meantime, the case spotlights the enduring phenomenon of mass‐​production ADA complaint mills, which may file hundreds of lawsuits against Main Street or online businesses with cookie‐​cutter complaint language, demanding a sum of money to go away that is often related to the cost of legal defense. While this is dressed up for its visit to the high court as “tester” litigation, it tends to be a good bit more cash‐​driven than the activities of, say, law school clinics that send so‐​called testers to apply for apartment vacancies to see whether landlords are treating applicants of one race less well.

I’ve written about ADA filing mills often at this site over the past decade. Here are a few examples: “New York Times Covers ADA Shakedown Lawsuits;” “Clint Eastwood, Lawyers, and the ADA;” “ADA’s Assault on the Web: Your Turn, Congress;” and “Lawyers Sue Retailers for Not Putting Braille on Gift Cards.”

Those in search of a deeper dive on the subject should check out my Cato blog Overlawyered, which ran from 1999 to 2000 and at which ADA filing mills were a recurring theme through a hundred or more posts.

Adam N. Michel and Chris Edwards

Republican presidential candidate Nikki Haley recently proposed eliminating the 18.4 cents per gallon federal gas tax. She reiterated her support for the idea at the second Republican debate in California.

Federal gas tax revenues go into the Highway Trust Fund and then are dished out to the states to use on highway and transit projects. However, since 98 percent of the nation’s streets and highways are owned by state and local governments, it would be simpler and more efficient if those governments were responsible for the funding. Having the federal government raise the funds and then return the funds to the states with regulations attached is unnecessarily bureaucratic.

States have the best information to determine their local infrastructure needs. States that want to improve their highways can increase their own state‐​level gas taxes, sales taxes, or user charges. Or they can issue debt or pursue full or partial privatization. The states have all the necessary fiscal tools to tackle their own infrastructure challenges.

In contrast to presidential candidate Haley, many policymakers favor raising the federal gas tax rate. They note that the tax has not been raised since 1993 and that its real value has been eroded by inflation. That is true. But in the absence of federal tax increases, states have filled the void.

The chart shows Federal Highway Administration data for federal gas tax rates and average state gas tax rates. The average state rate rose from 19.3 cents per gallon in 2000 to 27.8 cents per gallon in 2021, a 44 percent increase. On top of the gas excise tax, states impose an additional 6 cents per gallon on gasoline in other taxes and fees. States know their own highway demands and can raise taxes or user charges anytime they need to.

A Fox News story makes Haley’s proposal to cut the federal gas tax sound like a policy reversal because she supported a state gas tax increase as South Carolina governor. But from our perspective, these proposals are entirely in sync. The states should have responsibility for highway funding, and we need to start reversing the increase in central control over infrastructure supported by many Republicans and Democrats.

By the way, Haley’s proposed swap of higher state gas taxes for lower state income tax rates when governor was sound economics.

Nikki Haley’s proposal to repeal the federal gas tax would be a positive step away from the continued consolidation of government power in Washington. We encourage all the presidential candidates to propose strategies for reviving the more efficient and democratic federal structure of the U.S. Constitution.

Chris Edwards

Congress may consider a farm bill in coming months, which provides an opportunity for the two parties to come together on spending reforms. Republicans and Democrats should be able to agree that millionaire farmers do not need taxpayer subsidies.

Cato held a Capitol Hill forum last week on the economics of farm subsidies. The keynote speaker was Vincent Smith, director of agricultural policy studies at AEI and professor emeritus at Montana State University. The following are some excerpts from Vince’s comments on the need for farm program reforms.

Vince discussed the complexity of the farm bill and the power of special interests to set the agenda.

There are quite literally hundreds of programs and thousands of rules and regulations … The extraordinary complexity of the farm bill makes it easy for vested self‐​interest groups—such as the Farm Bureau, national agricultural commodity associations, private insurance companies, agribusinesses, and environmental groups—to persuade congressional members to put in provisions that serve their own interests.

In many cases, these provisions come at the expense of the nation as a whole by encouraging the wasteful use of resources, government spending in excess of the benefits accruing to the farm sector, and the redistribution of income to wealthy households from average taxpayers. The federal crop insurance program is the poster child for such wasteful initiatives.

Vince then discussed how federal crop subsidies are not crucial to the farm economy. If subsidies were repealed, there would be modest improvements in efficiency and America’s farm production would continue apace.

[The rationale for crop subsidies] is the claim asserted by some legislators that the U.S. farm economy and agricultural production will collapse and U.S. consumers will face the threat of significant food insecurity if programs that provide subsidies to farmers go away or are funded at a lower level.

This claim is unambiguously incorrect. Multiple studies have found that most farm income safety net subsidies have relatively small impacts on the production of most commodities. With one exception, they also have very small impacts on the amount of land used for crop production. To the extent that the subsidies bring new land into production, which is the case for the crop insurance program, that land is of relatively poor quality, fragile, and subject to soil erosion and other degradation (including increased carbon emissions) when moved out of grazing land, pasture, or forestry.

To see why this is the case, consider that apart from three recent years—2018, 2019, and 2020—such government subsidies provide exceptionally modest shares of total farm revenues from all sources including market sales and government subsidies. Further, subsidies translate rapidly into higher land prices, as peer‐​reviewed quantitative research has consistently demonstrated. This creates the associated problem of increasing the costs of entering farming for new, often younger farmers.

To repeat, there is no credible content to claims that the farm sector and agricultural production would collapse if farm income safety net programs, including the federal crop insurance program, were to go away.

If anything, the evidence points the other way. Current farm subsidy programs allow poorly managed, inefficient farms to survive for long periods of time, inhibiting the transfer of those resources to more efficient and productive operations, which are also likely to be more environmentally responsible. The case study that supports this conclusion is the well‐​documented and substantially positive productivity impacts of ending farm subsidy programs in New Zealand.

Vince also tackled “the claim that farm subsidies are essential for the survival of the family farm, which is a major appeal to the heart and purse strings of the public.” He finds that the vast majority of American farms are family farms, including most of the largest farms in the nation. The largest farms receive the great bulk of federal subsidies even though these farms are in top financial shape and do not need taxpayer handouts.

Over 97 percent of all farms in the United States are family farms, and that includes the overwhelming majority of such businesses often described as factory or corporate farms, which in terms of production are in the largest 10 percent of all farms. Those farms produce over 50 percent of all output and receive about 60 percent of all subsidies, as documented by AEI scholars and other researchers using USDA survey data. Large farms have low levels of debt and substantial assets, and they can readily access loans when commodity prices are lower than expected or crop yields are low because of adverse weather. Absent farm subsidies or the federal crop insurance program, large farms face almost no risk of going out of business because of year‐​to‐​year variations in farm income.

Mid‐​sized and small commercial farms that produce about 10 percent of U.S. agricultural output likely face more financial risks, but they get very little from price and income support programs. For example, under the crop insurance program, median‐​sized farms that use crop insurance receive about $2,500 a year in subsidies, while farms in the largest 10 percent receive over $70,000, on average, and the very largest farms (the top 1 percent) receive hundreds of thousands of dollars. That pattern is replicated in other farm income support initiatives, and initial research indicates the same holds true for the large conservation programs.

Vince Smith provides extensive analyses of agricultural programs and farm subsidies on his AEI webpage.

Scott Faber of the Environmental Working Group also presented at the Cato forum. His commentaries on farm programs are available here.

I echoed many of Vince’s and Scott’s points about crop subsidies at the forum, but I also pointed to foreign food aid as another area for budget reforms.

Romina Boccia

It’s a positive sign that Congress avoided an unnecessary and wasteful government shutdown this weekend. But the work to responsibly fund the government for the next fiscal year remains. Meanwhile the bigger fiscal challenge – growing debt and rising interest costs – continues to worsen.

As I predicted about six weeks ago, Congress would likely punt on funding the government in full by the statutory deadline of October 1, due to deep divisions over discretionary spending levels, how to fund federal disaster relief accounts, and whether to provide additional emergency spending for Ukraine.

Now they’ve done it, punting this fight to the Friday before Thanksgiving, once again pushing lawmakers up against a holiday deadline. This is an old story in Washington that continues to repeat itself. There’s nothing quite like deadline pressure to persuade legislators to let bad policy slide.

It’s not a completely clean continuing resolution, as Congress added $16 billion in emergency designated spending to shore up federal disaster accounts. This new deficit spending is in addition to the spending caps Congress agreed to in the debt limit deal (FRA, Fiscal Responsibility Act) to primarily cover a pre‐​existing Federal Emergency Management Agency (FEMA) budget shortfall that legislators knew about for many months. FEMA’s disaster accounts should be fully budgeted for under existing spending caps, not rely on a separate deficit funding stream because it’s more convenient for Congress to spend more than to cut wasteful and ineffective federal spending in other parts of the budget. Congress once again took the easy way out.

Congress should adhere to the spending caps agreed to in the debt limit deal without phony budget gimmicks and without blowing the budget by designating regular funding as if it were for emergencies.

More importantly, Congress must get serious about addressing the unsustainable growth in the U.S. debt that’s almost entirely driven by increases in health care, Social Security, and interest costs. Just last week, the interest rate on the 10‐​year Treasury bond reached 4.5% for the first time since 2007, driving up the cost of federal debt servicing—a debt that’s now as large as the entire U.S. economy and growing at a dangerous rate.

Under current projections, the federal government will seek to borrow in excess of four times the amount of debt, in just the next 30 years, as the United States has borrowed over its entire history ($120 trillion versus $26 trillion in publicly held debt).

While controlling discretionary spending, which funds a declining share (now 27 percent) of the federal government’s activities, is important, the ongoing government funding debate, which will resume in earnest before the November 17 shutdown deadline, is largely symbolic. America’s biggest fiscal challenge lies in the unchecked growth of federal health care and old‐​age entitlement programs.

Repeated shutdown fights and continuing resolutions have gotten us no closer to reforming Social Security and Medicare, which are responsible for 95 percent of long‐​term unfunded obligations.

A nonpartisan commission, modeled after the successful Base Realignment and Closure Commission (BRAC), is our best hope for reining in unsustainable health care and Social Security spending growth, before a severe debt crisis forces more drastic and painful measures.

Cato Editors

Erec Smith, a Visiting Scholar of Politics and Society at the Cato Institute, is the co‐​founder of Free​Black​Thought​.com and the author of A Critique of Anti‐​Racism in Rhetoric and Composition: The Semblance of Empowerment. In a September 19 interview on CSPAN’s Booknotes+, Smith discussed his work and commented on several controversial topics, including racism and DEI, diversity, equity, inclusion. Below are excerpts from the interview.

Asked about his favorite writers as a young man, Smith said, “Ralph Waldo Emerson and Frederick Douglass were my favorites [of the 19th century]. … Emerson’s self‐​reliance was a big motivator when I was in college as an undergrad. It resonated with me. … He has a wonderful essay titled ‘Self‐​Reliance,’ and he goes through life saying here’s why we shouldn’t have to depend on others too much. … We have knowledge ourselves. We should live life, you know, get out of the library and go out and live life. … I liked his grit, I liked his moxie, and I like what he was saying about self‐​reliance. Unfortunately, I think it’s something that is starting to wane in society today.”

Frederick Douglass is “an amazing story,” Smith said. “An escaped slave who became the most famous speaker of the 19th century. I could put ‘arguably’ in front of that, but no. If you look at the speaking engagements he had, the newspaper articles, he was in demand. People wanted to hear how this black slave escaped and became so eloquent.

“Well, he did it because of self‐​reliance. Hard work, knowing what he wanted to do, and going for it. Being pragmatic. And he admired Emerson for that. … They were inspirations for how to go out in this world and succeed. If Frederick Douglass can escape slavery and become the person he was, there’s no excuse for me not achieving my goals. What’s more, self‐​reliance is one of my favorite attributes, along with individuality – two things that Emerson embodied.”

Explaining his co‐​founding of Free​Black​Thought​.com, Smith said, “Free Black Thought is a non‐​profit focused on displaying viewpoint diversity within black America. There’s this idea that black people think alike, that they agree on certain interpretations, they agree on certain goals, things like that. They share the exact same values, attitudes, beliefs – and that is not true. So, Free Black Thought is out there to dispel that myth, and provide a voice for black writers, and poets and artists, who aren’t represented in mainstream media.”

After criticizing a speech by an academic who argued that learning standard English was wrong, Smith said he got a lot of pushback, people writing that he was “not a real, authentic black person, that I had a colonized mind, and I wasn’t as enlightened as everybody else about race relations in America and things like that. It got pretty vicious. It spilled over into social media. That motivated me to focus on the rhetoric of anti‐​racism and to fight race‐​essentialism, and to carve out free black thought.”

Smith: “There are certain people out there who don’t agree with me. It’s interesting when white people tell me I’m not being black correctly. That’s always fun. … I’ve been accused of white supremacy because I value things like self‐​reliance and individualism. I value learning as many dialects as you can, especially the one that’s the most common certainly in the professional spaces. Because of that I am [described] in quote/​unquote the white ways of knowing, and therefore a danger to the black community. And when white people tell me that it’s really disquieting, and infuriating, if I’m to be honest.”

When asked what he says back to those critics, Smith said, “It hasn’t really happened to my face. It’s happened on social media. I’m not entirely sure it would happen to my face anytime soon. But I remind people of the hypocrisy coming from a lot of anti‐​racist scholars, activists, what have you, who insist that we believe black voices – but not mine. They insist we should embrace the lived experiences of black people – but not mine. So I point out that hypocrisy and they typically have nothing to say.”

Smith was then asked to define certain phrases from his book.

Smith: “Systemic racism is the idea that racism, they say, is baked‐​in to American society and to American institutions. The idea is that these institutions are built with the oppression of minorities in mind. Certain policies are made so that white people maintain superiority. And every disparity in race relations is because of this systemic racism. Right? Every problem is because of this systemic racism and nothing else. That’s the idea.”

Asked if he sees systemic racism actually happening, Smith replied, “I don’t typically see it actually happening. But that’s the nature of it, if you ask the people who believe in it. It’s supposed to be hidden, insidious. It’s something you have to look for. And if you don’t see it, then you are suffering from false consciousness. You have a quote/​unquote colonized mind….”

Asked what white supremacy means to him, Smith said, “White supremacy is the act of maintaining supremacy by people of European ancestry. It is aligned with Enlightenment values like self‐​reliance and individualism, primacy of reason, rule of law. All these things are derived from people who derived from Europe, a.k.a. white people, and therefore, because of that connection, they are already considered inherently racist. A lot of people go so far as to say these things are worsening racism because they help hide it.”

Smith was then asked if he believes there is white supremacy and he said, “No. [People] who are most adamant about white supremacy are the ones that tend to have the least interaction with white people. They tend to be people who grew up in predominantly black and predominantly Latino areas and didn’t really meet and interact with white people until later on in their lives.

“I grew up in a predominantly white area and went to a very diverse school with many white people and black people around me. I liked it, I was proud of it for that. … At a young age I realized that white supremacy was not really legitimate. I was sitting in class and I looked to my left, and the white kid to my left was eating paste and I said, ‘He’s superior to me?’ (Laughter.) This is clearly a myth. … White supremacy is not the bogeyman, the specter that some people say it is.”

As for Black Lives Matter, Smith said, “I love the term. But the organization has some flaws, as most people are starting to realize. Forget about the financial issues they’re in. They’re coming from a particular ideology that I think is not conducive to improving race relations. That ideology is based in Marxist thought. They call it critical theory, or critical social theory. It basically — it takes Marx and instead of proletariat bourgeoisie, it’s [garbled] and project that on society and move from there. It’s based on that idea and I think it’s profoundly flawed.

“… A lot of black people feel like me. They don’t speak up because it doesn’t seem to be in their best interests. They like their jobs. They like being part of a community, whatever, and they don’t want to rock the boat. They understand the flaws in the logic of organizations like BLM.”

Commenting on DEI, diversity, equity, inclusion, Smith said, “The terms came from the civil rights movement in the 60s. … However, the definitions we have now are derived from a critical social justice mindset, and those terms have changed. … [Today] diversity means diversity of bodies but not viewpoint. … Equity means equality of outcome not equality of opportunity. … And inclusion is basically tantamount to censorship. You can’t say anything that might offend a minority or — they call it micro‐​aggressions. If you ask someone where he or she is from, that is considered inherently racist, whether consciously or unconsciously. So, these things are not quite what they used to be.

“That makes all the difference because that leads into the redefinition of other terms, like racism, for example. That can only be a white person discriminating against a black person, regardless of the white person’s socio‐​economic status or a black person’s socio‐​economic status. … Racism can only be done by white people. If I am discriminatory against people because of their white skin, that’s just discrimination, that’s just prejudice. Racism is something different.

“Most Americans don’t know that. Yet their DEI officials in their workplace or their school, or something like that, are abiding by those definitions, which is part of the reason why they can get away with it.”

To listen to the interview, click here.

Colleen Hroncich

I recently toured Freedom Learning Academy in Overland Park, Kansas, and was really inspired by what I saw there. Josiah Enyart was a public school teacher and coach for more than 10 years. Over time, he started to get a bit disillusioned by what he was seeing in his school. But it was really when his oldest child entered public school and started having some issues that he began paying closer attention to what was happening.

Then Covid hit, and the district’s mask and vaccination policies were the final straw. He pulled his kids from the district and decided to homeschool them. Other parents found out and wanted Josiah to teach their kids, too. He quickly remodeled his basement and launched Freedom Learning Academy in fall 2021 with 15 students. Word continued to spread, and he had 18 students by the end of the year—with nearly 80 on a waitlist.

With so much interest in his school, Josiah was scrambling to find a bigger location. But it’s hard to find a place that can work for a variety of educational needs, including classrooms, a community space, and outdoor space. Eventually he found a church that was happy to let the school come in on weekdays for an affordable price. Because of the trouble with finding a location, many of the interested families had already committed to other educational options. Despite the delay, Freedom Learning Academy had 36 students in the first year in the church and almost 50 the next year.

Freedom Learning Academy is registered as a Non‐​Accredited Private School in Kansas, which Josiah likes because it gives him a lot of flexibility and freedom from government intrusion. It is strongly influenced by Montessori principles, like self‐​directed learning with lots of hands‐​on activities. Teachers strive to maintain a homeschool‐​like atmosphere with one‐​on‐​one attention and giving students time to explore topics in depth and move at their own pace.

FLA uses Kansas state standards as a guide because Josiah believes it will help students when they transition to other learning environments, but students can move up and down as needed rather than being locked into a certain level based on their age or grade.

So far, Josiah’s experiment seems to be working. Enrollment has grown each year, and he hasn’t lost any students. “The families at FLA have been greatly impacted by our school,” he says. “With FLA, they have found a safe community that supports parental rights, hard work, strong character, good decision making, and a desire to build up every child in their academic and social skills through meaningful and engaging work mixed in with the opportunity to experience nature and participate in society.”

Josiah isn’t just bullish on FLA; he’s bullish on the sector as a whole. “Alternative education models like home‐​school, micro schools, and hybrid schools are the wave of the educational future,” he explains. “They are the only way I see us strengthening our country and maintaining the family values that shaped our country’s success that so many hold dear. It is a leap of faith. It is a lot of change if you’ve only been in public or private school, but it is worth it.”

To any would‐​be education entrepreneurs, including parents and teachers, who are considering starting a new learning environment, Josiah is very encouraging. “There are so many people willing to help and support your endeavor to improve education and the lives of those involved. The more options we can provide for parents, the more successful this next generation of leaders will be. We need to rebuild the bedrocks of our society: Strong family values, virtuous behavior, and skilled and knowledgeable individuals with the ability to collaborate, problem solve, and think critically. Alternative education is the answer.”

Anastasia P. Boden and Nathaniel Lawson

Arizona thinks that some people ought to be able to take other peoples’ property when they can put it to “better use.” We think not.

Under the Arizona Condominium Act, a supermajority of condo owners can force a minority of owners to sell their units against their will. That’s exactly what happened when an LLC called PFP Dorsey Investments bought ninety out of ninety‐​six units in a condo building in Tempe and then forced the sale of the remaining six units to itself—never mind that the remaining owners, including Jie Cao, did not want to sell or to leave their homes.

After the condo association changed the locks and shut the owners out, Cao brought a lawsuit seeking to invalidate the Act. Now the case is on appeal in the state’s highest court and we’ve filed a brief in support.

Defenders of Arizona’s law say it’s necessary to prevent the “holdout problem”—property owners who supposedly strategically refuse to sell at market price to compel extra compensation. In theory, such holdouts hinder economic development projects and their alleged trickle‐​down effects.

But as we wrote in our brief, the fact that some people would rather see private property go to a supposed “better use” can’t justify confiscating it. The Founders were very worried that private interests might coopt government power for their own ends. In Calder v. Bull, 3 U.S. (3 Dall.) 386 (1798), Justice Samuel Chase wrote of a “law that takes property from A. and gives it to B.” and explained that “[i]t is against all reason and justice, for a people to entrust a Legislature with such powers.… The genius, the nature, and the spirit, of our State Governments, amount to a prohibition of such acts of legislation; and the general principles of law and reason forbid them.”

John Locke, whose works were very influential on the American founders, stated, “I have truly no property in that which another can by right take from me when he pleases against my consent.” William Blackstone, a similarly influential figure to early American jurists, said that an “absolute right, inherent in every Englishman, is that of property,” which cannot be violated “even for the general good of the whole community.”

The understanding that, as John Adams once said, “liberty cannot exist” without property rights led the Founders to draft the Fifth Amendment’s Takings Clause. That clause prohibits the taking of private property for private use and demands that, even when the government takes property for public use, it must offer property owners “just compensation.”

Unfortunately, the clause has been watered down over the years by a Supreme Court that has effectively written the words “public use” out of the Constitution and that now largely defers to governmental assertions that its property theft will lead to some public benefit. The results can be tragic.

In the infamous Kelo case, for example, the Court permitted the City of New London to confiscate Suzette Kelo’s little pink house to make way for a new business development spearheaded by Pfizer. Even after that tremendous legal battle, Pfizer abandoned its New London facility in 2009, costing New London 1,400 jobs.

A decade after the Kelo decision, the condemned properties at the center of it remained “empty and undeveloped,” occupied only by feral cats.

Kelo ignited popular pushback across the nation, including in Arizona, where residents passed the Private Property Rights Protection Act (PPRPA). In Cato’s brief, we argue that the Condominium Act is a quintessential private taking that violates the Arizona constitution and the PPRPA.

The Condominium Act is also terrible policy. Multiple studies have shown a strong connection between protection of property rights and economic well‐​being, including increased income per capita. Nations with similar languages, cultures, and traditions have greatly disparate Gross National Income (GNI) per capita depending on their respect for property rights. South Korea’s GNI per capita is at least 17 times the income of North Korea’s, Finland’s is between 2.5 times and more than 7 times Estonia’s, and Taiwan and Hong Kong’s are both more than four times China’s. The sheer benefit of property rights justifies their enforcement.

Moreover, eminent domain abuse causes more harm than any holdouts supposedly cause. In the early 1990s, for example, Bremerton, Washington, settled a suit about odor complaints from a sewage treatment plant and agreed to install odor controls. The city then condemned 53 homes near the sewage treatment plant, including one owner’s home of 40 years, supposedly to create an odor easement. However, days after the condemnations were finalized, the city rezoned the land and sold it to a car dealership for $1.99 million. The city never created the easement.

In 1997, Hurst, Texas, used eminent domain to seize 127 homes to expand a real estate company’s mall, hoping to increase sales and property tax revenue. Ten couples, who had lived in those homes for as many as 30 years, sued to stop the condemnations. The trial judge refused to stay the condemnations while the suits were ongoing, so the residents lost their homes. The judge also refused an extension to a resident whose wife was in the hospital for brain cancer, forcing him to leave her bedside to move out his belongings. A total of three couples died and four others suffered heart attacks during the litigation. There was evidence that the land surveyor who designed the roads for the mall was told to change the path of one road to run through eight of the litigants’ houses. After years of litigation and receiving no compensation, the families were forced to settle.

In contrast, the holdout problem is not as problematic as some suggest; economic development has long managed to succeed despite holdouts. Some have even gone on to become cherished parts of the community.

In 1902, Macy’s decided to move its flagship New York store to the corner of 34th Street and Broadway. The new store was planned to cover the entire block. However, the owners of the competing Siegel‐​Cooper Co. bought one parcel on the corner of the block to bargain for a lease of the old Macy’s location. Macy’s thwarted this plan by refusing to negotiate, and it instead built the store around the tiny parcel.

Macy’s has never owned the parcel since, but it advertised on the parcel’s exterior from the 1940s until Amazon outbid it in 2021. Despite Macy’s being unable to get part of the property it sought, it still successfully built the store and even leased the holdout parcel for advertising space.

When Wickham’s Department Store wished to expand onto the land of Spiegelhalter’s jewelry shop to create a grander structure, the jewelry store owners refused to sell. Ultimately, Wickham’s built its grand structure around Spiegelhalter’s. The resulting lopsided look became extremely popular. Decades after both stores shut down, when new developers planned to demolish Spiegelhalter’s and replace it with a tall, glass atrium, campaigns by local groups managed to get the developers to keep Spiegelhalter’s intact.

We detail several more examples of charming holdout stories that ended happily, all while respecting property rights, in our brief.

In sum, our Constitution, and Arizona’s, protects property owners’ ability to hold onto their property even when others would rather see it go to someone else for a purported better use. The Condominium Act directly contradicts that foundational principle. We hope the Arizona Supreme Court will agree.

Read our full brief here.

Thomas A. Berry

Social media sites face many choices when they set rules for users. How much speech is permissible? Will conversations be “anything goes” or strictly moderated for relevance and decorum? Will moderation decisions be automated, human, or a mix? Different sites have made different choices, and that’s as it should be. Indeed, the First Amendment requires that sites have the freedom to make these decisions for themselves.

Although social media may be a relatively new medium, long‐​established First Amendment principles give sites the right to control what content they host, just as newspapers and book publishers have a right to select the editorials and manuscripts they print.

Some states, including Texas and Florida, have attempted to infringe the First Amendment rights of social media companies in blatant ways, such as by forcing sites to host user content they do not wish to. And now New York State has joined the fray with its own unconstitutional intrusion into the editorial freedom of social media sites.

New York recently enacted an “Online Hate Speech Law” that requires social media sites to promulgate policies governing so‐​called “hateful conduct” and create “mechanisms” by which users can report such conduct. “Hateful conduct” is defined by the statute to include online speech that can “vilify” or “humiliate” a group or a class on the basis of race, sex, and other traits.

New York’s law was soon challenged in a lawsuit brought by several operators of online platforms, including law professor and First Amendment expert Eugene Volokh. As the operator of the “Volokh Conspiracy” blog, which allows user comments, Volokh himself would be forced to comply with the law’s requirements.

A district court ruled in favor of Volokh and blocked the law from going into effect, holding that it likely compelled speech in violation of the First Amendment. The court found that the law impermissibly required sites to publish a “hateful conduct” policy even if they would prefer not to publish any such policy, forcing them to speak when they would prefer to remain silent.

New York appealed that decision to the Second Circuit, and Cato has filed an amicus brief urging the Second Circuit to affirm the lower court and hold the law unconstitutional (with thanks to attorneys Joshua Zuckerman and Brian McCarty of Gibson Dunn, who drafted the brief on behalf of Cato).

In our brief, we explain why the law’s “reporting mechanism” requirement violates the First Amendment rights of both social media sites and their users by chilling free expression. Some sites may prefer not to have a reporting mechanism for so‐​called “hateful conduct,” given that most of the speech falling under New York’s mandated definition of that term is itself lawful speech protected by the First Amendment.

These sites may reasonably expect that if they did have such a reporting requirement, users would naturally self‐​censor for fear of being reported. By compelling unwilling sites to create a mechanism for users to report on each other, the law is likely to stifle the uninhibited flow of speech that these sites would prefer to allow.

Of course, social media sites are free to voluntarily create reporting procedures, and many had already done so prior to New York enacting its law. But the choice of whether to create such a mechanism, how it operates, and what speech to make reportable must be up to each individual site.

New York’s one‐​size‐​fits‐​all definition of “hateful conduct” puts a thumb on the scale, with the clear aim of inducing self‐​censorship of some lawful speech that New York would prefer to suppress. The Second Circuit should make clear that states can’t use mandates like “reporting requirements” to indirectly achieve online censorship that states couldn’t impose directly.

Thomas A. Firey

Usually, when some government proposal is floated in D.C., it should be evaluated with careful, sober policy analysis. But in the case of the Federal Communications Commission’s new “net neutrality” push to more‐​or‐​less reinstate regulations that were repealed a half‐​decade ago, an old internet meme suffices:

If you don’t remember net neutrality, it prohibited internet service providers (ISPs) from treating some data streams differently than others, typically by either charging more or limiting the delivery speeds for, say, high‐​definition movies from outside the ISP. Regulation supporters claimed that all data streams should be treated the same. ISPs and other internet infrastructure providers responded that if they were to provide more and better services for heavy users, they should be able to charge those users higher prices or moderate their use.

Net neutrality supporters predicted that, if the internet companies got their way, disaster would result. Among the foretold parade of horribles: the rise of a vicious ISP cartel, wide‐​ranging internet censorship and loss of privacy, and the end of internet innovation and perhaps even the internet itself. For a sense of these apocalyptic visions, check out some editorial cartoons from the time.

But the internet companies won the political fight, net neutrality was repealed and … the World Wide Web continued on. In fact, most users didn’t realize that anything had changed. And a few years later, when a large chunk of American life suddenly moved online because of the COVID pandemic, the nation had a more built‐​out internet to handle the flood of electronic commerce, virtual education, and home entertainment.

Unfortunately, policymakers often do not react rationally when their ideas are disproven by reality; hence the FCC’s new net neutrality push. The same thing is happening at the Federal Trade Commission and the Justice Department’s Antitrust Division, where policymakers are undaunted by their string of false predictions of doom from specific corporate mergers and acquisitions.

To learn more about net neutrality, see this summary of articles on the topic that have appeared in my journal, Regulation, and the work of my Cato colleagues.

Jeffrey Miron

This article appeared on Substack on September 29, 2023.

The United Nations has released a report that calls for ending criminal penalties for drug use. Decriminalization is in line with libertarian principles, and penalties against users generate substantial harms, even when jail terms are absent (lower employment prospects, loss of public housing, deportation, reduced individual liberty, and racial disparities in police interactions).

But legalizing use is a halfway measure that often fails to eliminate harm from prohibition or even makes things worse.

Legalizing possession, but not production, does not eliminate the underground market, so violence and quality control issues remain. Indeed, to the extent decriminalization increases demand, it expands the black market and thus causes more violence. This describes Oregon, where violence and overdoses failed to decline even after decriminalization.

Another risk is that the criminal justice resources freed up from decriminalization shift to increased enforcement against drug supply, making violence and quality control problems worse. Enforcement pushes more transactions out of the legal sphere and disrupts agreements between market participants, increasing the scope for violence.

These concerns might seem inconsistent with the experience of some cities, states, or countries that have decriminalized and experienced reductions in prohibition‐​induced harms. Portugal’s drug decriminalization, for example, is often seen as responsible for the country’s low drug mortality rate. Decriminalization in the Netherlands is similarly praised for producing low heroin use and low HIV prevalence among users.

The likely explanation is that, while these places have labeled their policies as decriminalization, the policy changes also reduced supply‐​side enforcement, implying less disruption of the underground markets. Thus these examples again show that eliminating supply‐​side prohibition is crucial.

The UN should call for total legalization, the only approach that will fully resolve the harms identified in its report.