COMPETITIVE ENTERPRISE INSTITUTE

VOL. 30, NO. 2 | SUMMER 2017

FEATURED ARTICLES

The Institutions of Liberty:

What is Old Must Be New Again
4
BY RYAN RADIA
A Chance to Improve the FCC

5
BY WAYNE CREWS
The Only Way Washington
Can Be Smaller In Four Years

move through a wave of 21st century popu-

BY KENT LASSMAN lism, are the institutions of liberty.

12 This article is excerpted from Kent Lassmans

Populism elevates majoritarianism above
what we know to be the just goals of gov-
keynote speech delivered at the recent ernmentto secure the natural rights of all,
BY MICHELLE MINTON European Resource Bank meeting in among them life, liberty, property, and the
End the Madness by Letting Podgorica, Montenegro. pursuit of happiness.
States Legalize Sports Betting James Madison studied the democra-

ALSO IN THIS ISSUE

C lassical liberals of every stripe have
gathered to share information, build
human capital, and to learn how to create
and maintain the institutions of liberty.
Africas Economy Needs to We are at the crossroads for classical
Come out of the Shadows. . . . . . . . . . . . . 6 liberalism and liberal democracies. The clas-
Quit Paris Climate Treaty: sical liberal tradition calls for respecting the
Opposing View. . . . . . . . . . . . . . . . . . . . . . 7 liberty of individuals and of conscience, the
freedom to trade goods and services, and
The Good, the Bad, and the Ugly. . . . . . 14
the mobility of people.
Media Mentions. . . . . . . . . . . . . . . . . . . . 15 I submit that what makes us alike are our
End Notes . . . . . . . . . . . . . . . . . . . . . . . . . 16 natural rights. What holds us together, as we
cies of the pastnotably, failed democra-
ciesin Athens and Rome. But his greatest
insight came from the intellectual heritage of
the Enlightenment. Among others, Madison
learned from the Scottish philosopher David
Hume that representation in our governing
institutions can refine the popular will. A dose
of republicanism cools the tempers of the
most impassioned.
Madison also knew, in perhaps his most
famous turn of phrase, if men were angels we
would need no government.
(continued on page 3)
 A New Beginning with Old Friends
by Jim Harper
T he fight for freedom has many happy warriors, and
Im pleased to have joined Kent Lassman and the
Competitive Enterprise Institute team earlier this year in
CEIs version of that fight.
In a way, Im actually rejoining CEI. Sixteen years
ago, CEI was the first outlet beyond my own website to
FROM THE VICE PRESIDENT
publish my arguments against Internet regulation in the
name of privacy. Solveig Singleton and I co-wrote With
a Grain of Salt: What Consumer Privacy Surveys Dont
Tell Us in 2001 to caution against Internet regulation
based on abstract consumer fears.
History has shown that consumers prefer the big,
rollicking, and challenging commercial Internet weve
got to the small, tightly controlled Internet that federal
bureaucrats were pushing for in the early 2000s.
CEI continues to give young analysts a chance.
Former intern Daniel Press, whom we recently hired as
a research associate, has an excellent article out, co-
authored with Vice President for Strategy Iain Murray.
Press and Murray point out how secure property rights,
institutional reform, and affordable energy can unlock
prosperity in Africa.
But international bureaucrats are fighting to keep the
worlds people contained within their ideological and
bureaucratic systems. Thats why I think a recent paper
by Angela Logomasini is so important. Two recent World
Health Organization reports have made a hash of the
issues around pollution and development. By intermin-
gling the challenges of less developed nations with
those of more developed ones, they argue against the
pro-growth, free market policies that would let people
in developing nations enjoy higher living standards and
longer lives.
It often takes years, but works like these and many
others lay the groundwork for policy change that will
move our country and world further in the direction
of prosperity and liberty for all. There are no better
examples of those payoffs than what were seeing in
policy areas that are particular CEI strengths.
The regulatory reforms happening in Congress
would be smaller, more timid efforts if it hadnt been for
Wayne Crewss years of toil in the regulatory trenches.
Publisher
Kent Lassman
Editor
Richard Morrison
Editorial Director
Ph (202) 331-1010
Ivan G. Osorio
Fax (202) 331-0640
info@cei.org Contributing Editor
Molly Dreisbach
ISSN#: 1086-3036
2 CEI.ORG
His publication, Ten Thousand Commandments, has
become the annual catalog of growth in the regulatory
state along every dimension. Lately, with yet another
recent paper, Wayne has popularized the concept of
regulatory dark matter, those sub-regulatory guid-
ances, letters, statements, and cock-eyed glances that
regulators use to manipulate American companies,
landowners, and small businesspeople.
Energy and environment is another area where CEI
work is paying off big time. Myron Ebell and colleagues
have helped create the circumstances for policy change
in this area. Lets make it so that the United States can
use all of its energy and material resources and to build
our strong and productive, free society. Lets protect
the environment through non-coercive means using the
ideas of R.J. Smith, who recently celebrated his 80th
birthday with us.
Of course, litigation is a CEI specialty. Lately, CEI liti-
gators have had to fight for the organizations ownand
yourfree speech rights.
When Kent Lassman first joined CEI as president,
he was greeted by a subpoena asking for information
about CEI advocacy and donor information going back
over 10 years. Because of a stiff challenge led by CEIs
general counsel, Sam Kazman, a group of state attor-
neys general calling themselves AGs United for Clean
Power has lost a lot of energy.
CEIs Center for Class Action Fairness is leading the
fight against bogus class action settlements that reward
attorneys far more than they should for the small benefits
they bring to plaintiffs.
In the background of all this work, I see a better
vision for organizing society.
The fight for freedom at CEI rests on the vision of a
free people deciding for themselves, through billions of
personal and marketplace decisions, what their society
is going to look like. When the restraint or corrective of
the law is needed, its the common law of contract, prop-
erty, and torts, anti-fraud and harm-based criminal law.
If I can help make this vision more explicit at CEI and
nurture the growth of freedom in the United States and
around the world, Ill be one happy CEI warrior.
The CEI Planet is produced by the Competitive Enterprise
Institute, a pro-market public interest group dedicated to
free enterprise and limited government.
CEI is a non-partisan, non-profit organization incorporated in the
District of Columbia and is classified by the IRS as a 501 (c)(3)
charity. CEI relies upon contributions from foundations, corporations
and individuals for its support. Articles may be reprinted provided
they are attributed to CEI.
COMPETIVE ENTERPRISE INSTITUTE
 Liberty, continued
Ive seen many people in govern-
ment and have not seen many angels.
Therefore, governing institutions must
both be limited, and limit the authority
of any one faction.
Id like to remind everyone
of Madisons wry observation in
Federalist No. 55.
If every Athenian citizen had been
a Socrates, every Athenian assembly
would still have been a mob.
Large popular mandates are nice
as far as they go. They are oftentimes
necessary to effect big changesand
we have a lot of big changes in mind
but they are insufficient.
The question is not whether our gov-
ernment will be controlled by an elite
group or by the democratic masses.
The people holding political authority
will always, by definition, constitute
an elite. The question is whether our
future governing elites will respect and
defend our rights or sweep them aside.
Ive asserted that many familiar
20th century institutions are coming
undone. They will be remade or they
will be replaced. Ive warned explicitly
against too much faith in populism that
is divorced from our shared principles.
But lest there be any confusion,
popular support, in and of itself, is not
a bad thing.
But while nearly always necessary,
popular support must not become an
end in itself.
At the Competitive Enterprise
Institute, our work is focused on regula-
tory power, perhaps the area of law
most allergic to popular will.
America faces a fundamental
question for economic regulation. Will
we adopt an increasingly technocratic
Kent Lassman (kent.lassman@cei.org) is President of CEI.
COMPETIVE ENTERPRISE INSTITUTE
The question is
whether our future
governing elites will
respect and defend
our rights or sweep
them aside.
regime and move toward the full R.M.
embrace of the precautionary principle?
Not on my watch. Not while CEI FREEDMAN
exists.
Our job now is to inject a healthy SOCI ET Y
dose of local knowledge and common
sense into an ailing system poisoned
by politically fashionable expert opin-
Help the Competitive
ion and unaccountable bureaucrats.
We know that law is a tool of Enterprise Institute
economic dynamism. It sets familiar carry on its work for
boundaries for contract, fraud, prop-
erty, and trespass, maximizing oppor-
generations by joining the
tunity within a common framework. R.M. Freedman society.
Regulation is a tool for control. It
permits behavior and creates monitor-
ing systems for enforcement. It mini- In 2013, CEI established the R.M. Freedman
Society in honor of Robert M. Freedman,
mizes perceived risk and increases the
a business owner from West Bloomfield,
investment necessary to comply with
Michigan, who placed CEI in his estate
expert, technical codes.
and, in 2009, sadly passed on and gave
Like you, I want to see a society CEI its first legacy gift. We named the
where people are in charge of deci- society in appreciation of his generosity.
sions about their own lives. A tolerant
society. A society based on laws rather Many of CEIs extended family choose to
than on men. It means, simply, that include CEI in their estate plans through:
Im with you. I lead a think tank and Bequests,
our role is to promote the institutions of Charitable Remainder Trusts,
liberty, now and always, the new and
Charitable Lead Trusts, or as a
emergent, as well as the old.
Life insurance beneficiary.
If you make the decision to include CEI in
your estate plans, please reach out and let
us know.
While these sorts of decisions should be
undertaken with the help of an estate
planner, Lauren Avey and Al Canata of
CEI can be a resource to you. You can
reach them anytime at 202-331-1010.
C E I . O R G 3
 A Chance to Improve the FCC
BY RYAN RADIA
T he new Chairman of the Federal
Communications Commission
(FCC), Ajit Pai, has his work cut out
for him. He must move the FCCs
approach to technology and telecom
policies from the heavy-handedness
that characterized the Obama era,
as with the public utility regulation
of broadband providers, to a lighter
touch focused on advancing Internet
freedom, fostering innovation, and pro-
moting access to new technologies.
This transformation is critical for
consumers, given that the FCC regu-
lates Americans ability to access and
use many technologies that younger
generations now take for granted.
From our mobile devices and GPS to
cable television, government regula-
tors at the FCC dictate what com-
munications-related innovations and
infrastructure are available to you and,
indirectly, at what cost.
Chairman Pai has already signaled
his willingness to revise and improve
FCC regulations, which grew increas-
ingly harmful and obsolete during
the Obama era. One such rule is
already off the books due to a recent
vote in Congress, which used the
Congressional Review Actto elimi-
natethe FCCs broadband privacy
rule in early April. That rule distorted
the Internet marketplace, treating
telecom companies such as Comcast
and Verizon differently than Internet
content providers such as Amazon and
Netflix.Instead of fostering competi-
tion for individualized advertising, the
privacy ruleundermined it, depriv-
ing consumers of discounted Internet
access thanks to advertisers subsidiz-
ing their broadband provider.
But the most harmful FCC regula-
tions issued during the Obama adminis-
tration have been in place long enough
that they cannot be undone through
the Congressional Review Act, which
allows Congress to vote to repeal a
rule up to 60 days after it is finalized.
4 CEI.ORG
The Open Internet
Order, inspired by
the net neutrality
movement, has
thwarted broadband
providers efforts
to give consumers
better Internet plans
at lower prices.
Undoing these rules, therefore, is now
the responsibility of the FCC.
The agencys top priority should
be undoing net neutrality by reversing
the so-called Open Internet Order.
This 2015 ruleclassified broadband
providersas common carriers under
Title II of the Communications Act of
1934. The upshot of this decision was
to place broadband companies under
the same regulatory structure origi-
nally crafted over 80 years ago to
oversee the long-defunct Ma Bell tele-
phone monopoly. The Open Internet
Order, inspired by the net neutrality
movement, has thwarted broadband
providers efforts to give consumers
better Internet plans at lower prices.
Chairman Pai is reportedly finalizing
his plans to roll back the 2015 order,
while defenders of Internet regulation
are gearing up for a fierce battle.
Lifting rigid regulations on Internet
providers would help create a freer,
more consumer-friendly, telecom sector.
But that will not be enough. Decades of
legacy regulationsfrommedia owner-
ship restrictionsthat originated in the
1940s to telephone fees that are really
just corporate welfareshould be on
the chopping block as well.
The FCC should also revisit the tele-
vision marketplace. During the Obama
administration, the agencyproposed
bringingmany online streaming plat-
forms into the regulatory framework
governing cable and satellite provid-
ersdespite the fact that Netflix is
hardly an old-school cable company.
More recently, the FCCsought to
issueextensive rules dictating how TV
set-top boxes are designed. Chairman
Pai has already announced the FCC
will abandon the set-top box pro-
posal. He could go further by sunset-
ting existing regulations that apply to
these boxes.
Making these changes will take
some time, especially if the FCCs
new leadership is to stay on the right
side of theAdministrative Procedure
Act, the federal law governing how
agencies issue and revise regulations.
As the FCC works to achieve broader
reforms, it should follow the precedent
set by the Obama administration in
2009, which declined to defend in
court controversial regulations such as
the net neutrality rule. (The legality of
that rule remains a live issue, currently
at theen bancstage in the U.S. Court
of Appeals for the D.C. Circuit.)
Ultimately, Congress, not the FCC,
needs to rein in the agencys years of
regulatory excesses. Otherwise, every
four years, three unelected individuals
will acquire immense power to shape
the future of the Internet and the
telecommunications market in gen-
eralchecked only by the willingness
of federal judges to reverse agency
actions. Therefore, imposing clear limits
on the FCCs roleor even abolishing
large chunks of the agencys author-
ityis necessary if the Internet is to
remain open and free. In the meantime,
with Chairman Pai at the helm, the
FCC has an opportunity to change its
course on significant regulations.
Ryan Radia (ryan.radia@cei.org) is
research fellow and regulatory counsel
at CEI. A version of this article was
originally published in RealClearPolicy.
COMPETIVE ENTERPRISE INSTITUTE
 The Only Way Washington Can Be Smaller In Four Years
BY WAYNE CREWS
T here are now several moving and
overlapping parts to President
Donald Trumps streamlining, swamp-
draining agenda.
April brought Office of
Management and Budget (OMB)
Director Mick Mulvaneys memo-
randum for agency heads on a
Comprehensive Plan for Reforming
the Federal Government and Reducing
the Federal Civilian Workforce. Theyll
have to report back in 180 days on
streamlining, with public input.
Mulvaney calls much agency
activity, costly solutions in search pf a
problem:
The result has been too many over-
lapping and outdated programs,
rules, and processes, and too many
Federal employees stuck in a system
that is not working for the American
people.
Overlap isnt the real issue. Its
the existence of most programs and
agencies, period. What is it exactly that
agencies are doing? What are they
there for? The premises of the supervi-
sory state are the issue.
If we were starting with a blank
sheet of paper, we may not keep most
federal agencies .
Of course we did start with a
blank sheet of paper at the Founding.
Somehow, we had houses before HUD
and we learned before the Education
Department appeared on the scene.
The Founders didnt seek to control
us back then, yet our complex society
is even harder, not easier, to supervise
centrally.
But back to Trumps Bureaus
against Bureaucracy. Alongside
Mulvaneys Comprehensive Plan
for Reforming Government, weve
recently seen:
COMPETIVE ENTERPRISE INSTITUTE
1. Theestablishment of Regulatory
Reform Offices and Task
Forcesat each agency to cut
out red tape (E.O. 13777,
Enforcing the Regulatory
Reform Agenda)
2. Trumps initial Executive Order
ona Comprehensive Plan for
Reorganizing the Executive
Branch, now fleshed out by
Mulvaneys guidance and
queries to agencies;
3. New detailedguidance from
OMB to agencieson carrying
out Trumps Executive Order
12771, Reducing Regulation
and Controlling Regulatory
Costs on implementing a
cost freeze, and eliminating
two rules for each new one
implemented;
4. Establishment of theOffice of
American Innovationtasked
with bringing private sector
business and management
expertise.
The Trump administrations actions
here are the most aggressive aimed at
reduction of bureaucracy sincePresident
Ronald Reagans original regulatory
oversight executive order cut both rules
and number of pages in the Federal
Register by more than a third.
But executive actions arent perma-
nent. Congress created this bureau-
cracy and only Congresscan reduce it.
The administrative states century-
long premise is that expertise consists
in a priestly, guiding hand from above,
for efficiency and safeguarding the
public.
My favorite recent takedown of
the administrative states premises is
Steve Haywards article, The Threat
to Liberty, and I highly recommend
it, especially to those carrying out the
new Trump/Mulvaney directives.
Real expertise means something
else entirely in free economies; it
C E I . O R G 5
Real expertise
means ensuring that
the once-public
and centralized
endeavors of
mankind are moved
into the voluntary,
competitive
marketplace.
means ensuring that the once-public
and centralized endeavors of mankind
are moved into the institutions of the
voluntary, competitive marketplace.
This, arejection of administrative state
premises, should guide Trump and
Mulvaney streamlining initiatives.
Blueprints for thede-escalation of
central power is the essence of what
should count as agency expertisein
todays world. If Trump and Mulvaney
can make agencies back off their
brazenness, especially as applied to
growing new sectors, the downsiz-
ing can take care of itself. That is, if
Congress does its part and prevents
agency interference in new areas
where it hasnt explicitly legislated
authority.
The fiscal side gets most of the
attention, and will again soon with the
budget proposal. But stop giving agen-
cies new work to do, stop appointing
commissioners and directors in the
first place, and budgets take care of
themselves.
Wayne Crews (wayne.crews@cei.org)
is Vice President for Policy at CEI. This
article is excerpted from a column origi-
nally published onForbes.com.
 Africas Economy Needs to Come out of the Shadows
BY IAIN MURRAY
W esterners used to call sub-Saha-
ran Africa the Dark Continent.
That epithet reflected a willful igno-
rance of the continents civilizations,
cultures, and history, and helped justify
a shameful period of colonization,
exploitation, and oppression. Yet in
two respects the characterization is
accuratemuch of the regions econ-
omy exists in the shadows, and energy
infrastructure to light the continent is
supbar. Correcting these two problems
will go a long way to improving the lot
of every African.
In the international development
community, there is much talk of
an informal sector in developing
economies. That means that businesses
and individuals operating in it do so
without the protection of law, and are
probably doing so illegally. They may
well thrive through some combination
of corruption, benevolent neglect by
the government, or the public holding
the laws in question in general disre-
pute. Yet if a problem arises, informal
entrepreneurs have no leg to stand on
in front of a court of law.
Growing central business district and railroad in Gaborone, Botswana, 2017
6 CEI.ORG
This is a massive problem. As Daniel
Press and I write in a new Competitive
Enterprise Institutestudy: Studies
conducted across Sub-Saharan Africa
estimate that the informal economy
accounts for some 50 to 80 percent of
the regions GDP, 60 to 80 per cent of
employment, and as much as 90 per
cent of new jobs. Having that many
people dependent essentially on luck
for their livelihood grossly exacerbates
Africas longstanding problems of busi-
ness climate uncertainty and lack of
investment.
Most development agencies tend
to blame lack of infrastructure, educa-
tion and skills training, and limited
access to technology for the problem
of the informal economy. But what
Africa really suffers from is oppressive
government. Taxes are high, regula-
tions are either strict or nonsensical
(sometimes both), and property rights
lack protection. So people take the
rational approach and work around
the problemwhich means operating
in the informal economy.
Responsible African governments
can follow the example ofBotswana,
which has worked to establish a reli-
able rule of law (although its courts
are still backlogged), allow businesses
more freedom, and provide an expe-
dited process for entrepreneurs to set
up businesses. As a result, it is one of
the most prosperous countries in Africa
per capita, withone of the worlds fast-
est growth rates.
However, allowing entrepreneurs to
run their businesses free from govern-
ment interference will not be enough to
propel the continent to the next level of
development. That will require access
to affordable energy, which is the
lifeblood of large-scale business and a
sure provider of real wealth.
Unfortunately, too many Western
development officials see Africa as a
testing ground for unproven renewable
energy technologies. Their goal? To
see if African nations can industrial-
ize without fossil fuels. That is a fools
errand. As the World Bank hasnoted,
theres never been a country that has
developed with intermittent power.
Climate concerns are also over-
blown. Africa is currently responsible
for just 4 percent of global emissions of
greenhouse gases. Even if Africa were
to develop entirely on fossil fuels, the
International Association for Energy
Economicsfindsthat will increase total
global emissions by as little as2 per-
centover current levels.
Western governments owe Africa
a huge debt for the way they have
treated it in the past. One of the best
ways of repaying this debt is to encour-
age their African counterparts to solve
these two problems, and empower
figuratively and literallythe African
entrepreneur to light the way forward.
Iain Murray (iain.murray@cei.org) is Vice
President for Strategy at CEI. A version
of this article was originally published
onThe Huffington Post.
COMPETIVE ENTERPRISE INSTITUTE
 Quit Paris Climate Treaty: Opposing View
BY CHRISTOPHER C. HORNER
P resident Trumps advisers are debat-
ing recommendations on the Paris
climate treaty. Reported arguments
for staying in it appear to be no more
than rationalizations to break Trumps
campaign promise to leave.
Consider the line that it is not a
treaty because its not binding. This
is, respectively, untrue and irrelevant.
State Department guidelines (Circular
175) establish treaty criteria, and the
Paris Climate Agreement requires
Senate ratification to be valid under our
Constitution. Do it legally, or get out.
President Obama claimed that the
Senates treaty-power role existed at
his discretion in order to confer treaty-
like status on his domestic climate
agenda without making the apparently
futile case to gain political support.
COMPETIVE ENTERPRISE INSTITUTE
Accepting this precedent guarantees
that future pen and phone presidents
will also avoid constitutional review of
unpopular commitments by just declar-
ing them not a treaty.
Climate catastrophe?No computer
modelcited by the United Nations
projects a detectable temperature
reduction from the Paris Agreement. The
ultimate aim of the agreement is instead
to make the most abundant energy
increasingly costly, artificially rationing
its availability.
Seeking subsidies or competitive
advantage for the renewable energy
industry under these schemes have
motivated climate treaties since Enron
pioneered the move in the mid 1990s.
They seek to use government to profit at
your expense.
Remaining in the agreement endan-
gers energy prices underpinning the
U.S. manufacturing renaissance Trump
C E I . O R G 7
favors, while also risking that activist
courts will reimpose restrictions such as
the EPA war on coal rules that Trump
says hell undo.
We hear climate policy leadership
will be ceded to China. Did you hear
about the mule who refused to shed his
reins because he didnt want to give
up his leadership position? Me neither.
Withdrawing means take one lump,
now, and avoid sticking us all with the
bill once Trump leaves office. Trump
promised as candidate to withdraw.
Breaking that vow amounts to a costly
betrayal.
Christopher C. Horner is a senior fellow
at CEI. A version of this article was
originally published in USA Today.
 C E I E V E NT S UP DAT E

CEI Experts Reach out to Global Allies

Left to right: CEI President Kent Lassman, former Spanish Prime Minister
Jose Maria Aznar, and UK Member of the European Parliament Daniel
Hannan at the Conservatives International Conference
In April and May, CEI experts spoke at two major
international conferences that brought together allies
from around the world. On April 22, CEI President
Kent Lassman delivered the keynote address at the
European Resource Bank meeting, held April 21-23 in
Podgorica, Montenegro. On the same day, CEI Vice
President for Strategy Iain Murray spoke on a panel
on regulation in the sharing economy. Then on May
26-27, CEI cosponsored the Conservatives International
conference in Miami, along with the Alliance of
Conservatives and Reformists in Europe and others.
On May 26, Iain Murray participated on the panel,
Capitalism for the Little Guy. Later that evening, Kent
Lassman and Daniel Hannan MEP gave remarks at the
Freedom Reception, which CEI hosted. On May 27, CEI
Founder Fred Smith participated on a panel discussion
on how business leaders canand shouldengage
with the public to promote pro-market policies.

CEI Vice President for Strategy Iain Murray speaks at the

Conservatives International Conference.
CEI Founder Fred Smith speaks at the Conservatives
International Conference.

8 CEI.ORG COMPETIVE ENTERPRISE INSTITUTE

 Jim Harper Calls for Stronger Fourth Amendment
Protections at National Constitution Center
On May 11, CEI Vice President Jim Harper joined a panel of experts at
the National Constitution Center (NCC) in Philadelphia to discuss how
to apply the Fourth Amendment in the digital age. Harper discussed
his proposal for applying the Amendments protections to data and
telecommunications so modern Americans may enjoy the privacy
protections the Framers of the Constitution sought, a goal the Supreme
Court has stated in recent Fourth Amendment cases. The NCC recently
published Harpers paper, Administering the Fourth Amendment in the
Digital Age, in which he argues that courts should eschew doctrine,
such as the reasonable expectation of privacy test. Instead, they
should assess whether there was a search or seizure, whether it was of
the items listed in the Fourth Amendment, and whether such searching
or seizing was reasonable.

CEI Hosts FCC Chairman and Former FCC Chief Economist

On May 16, CEI hosted Federal Communications
Commission (FCC) Chairman Ajit Pai at a Capitol
Hill forum. CEI President Kent Lassman interviewed
Chairman Pai regarding the FCCs plans to repeal
burdensome Internet regulations issued in recent
years (pictured). Following this discussion, Lassman
moderated a panel of telecom policy experts, including
CEI Research Fellow and Regulatory Counsel Ryan
Radia, who explained how Congress can ensure that a
future FCC does not impose heavy-headed regulation
on the Internet. Then on May 17, CEI hosted a book
party featuring Professor Thomas Hazlett, a former
FCC chief economist and author of the new book on
spectrum policy, ThePolitical Spectrum: The Tumultuous
Liberation of Wireless Technology, from Herbert
Hoover to the Smartphone. Radia interviewed Hazlett
about his new book, which chronicles how free market
forces have improved the allocation of spectrum
and the ways in which the government is still far too
involved in how spectrum is used by market participants.

COMPETIVE ENTERPRISE INSTITUTE C E I . O R G 9

 Myron Ebell on the Energy and
Environment Policy in the
Trump Administration
On March 16, Myron Ebell, director of CEIs Center for
Energy and Environment, participated in a luncheon
discussion at the Independence Institute in Denver, on his
recent role leading the incoming Trump administrations
EPA transition team (pictured). The event attracted around
120 attendees.He also recorded a 30-minute interview
for Independence Institute President Jon Caldaras
weekly show, Devils Advocate, on Colorado Public
Television.Then on March 23 and 24, Ebell spoke at
the Heartland Institutes 12th International Conference
on Climate Change in Washington, D.C., where he
was presented the Speaking Truth to Power Award
by Heartland President Joseph Bast.On April 5, Ebell
debated Jeremy Symons of Environmental Defense at an
event hosted by Georgetown University.Then on April 24,
Ebell spoke on the prospects of energy sector deregulation
in the Trump administration, climate policy, and other
topics at the Bloomberg New Energy Finance (NEF) 10th
annual Future of Energy Summit in New York City, an
invitation-only event with over 1,000 attendees, which was
livestreamed to Bloomberg NEF clients. Finally, on May
15 and 16, Ebell spoke at the Washington Policy Centers
annual Solutions Summit policy conference, in Spokane
and Bellevue, Washington, on environmental policy in the
Trump administration.

Marlo Lewis Discusses U.S.-Canada Energy

Cooperation and Auto Fuel Efficiency
On April 5, CEI Senior Fellow Marlo Lewis participated in a Heritage
Foundation panel discussion of U.S.-Canadian economic and security
issues (pictured). Saskatchewan Premier Brad Wall keynoted the
event. Then on April 14, Lewis participated in a panel discussion,
sponsored by the R Street Institute, on fuel economy and vehicle
emission regulation. Lewis argued that auto markets are a discovery
process for finding outconsumer preferences. He was joined on the
panel by Chris Nevers of the Alliance of Automobile Manufacturers,
Steven Nadel of the American Council for an Energy Efficient
Economy, Ian Adams of R Street, and Rod Richardson of the Grace
Richardson Foundation.

10 CEI.ORG COMPETIVE ENTERPRISE INSTITUTE

 Marc Scribner on Transportation and
Infrastructure
On February 22, CEI Senior Fellow Marc Scribner
spoke on a panel before House staffers on how to
reform airport financing in a free market direction. Then
on March 6, he appeared on a Cato Institute panel on
the prospects for transportation regulatory reform in the
forthcoming infrastructure package being developed by
the administration. On March 29, Scribner spoke at an
event sponsored by The Hill newspaper at the Newseum
(pictured) on infrastructure modernization and what the
United States could learn from Canada.

CEI Unveils New Agenda

for Congress
On March 23, 2017, CEI hosted
an evening reception on Capitol
Hill to launch Free to Prosper:
A Pro-Growth Agenda for the
115th Congress. Free to Prosper
is designed to be the go-to
resource for policy makers and
their staff for market-oriented
policy solutions. All of CEIs policy
experts attended the reception
to meet and speak with over 70
congressional staff who joined
us. CEI President Kent Lassman
provided welcoming remarks.

COMPETIVE ENTERPRISE INSTITUTE C E I . O R G 11

 End the Madness by Letting States
Legalize Sports Betting
BY MICHELLE MINTON
D uring the recent National
Collegiate Athletics Association
(NCAA) Mens Basketball
Championship, sports fans around the
nation eagerly followed the action
not just to see how their teams per-
formed, but how well they did in their
March Madness betting pools, with
the chance of winning a small sum of
money by predicting the winner. Few
realize, however, that their friendly
wagers on the games are illegal due to
an archaic federal statute. For the sake
of the millions of fans who enjoy betting
on the game and the constitutionally
guaranteed sovereignty of the states,
this law must be changed.
12 CEI.ORG
Gambling regulation has histori-
cally been a state matter. As a form of
commerce conducted entirely within
state borders, Congress generally
leaves it up to the states to decide how
it ought to be regulated. However, in
the 1990s more than a dozen states
contemplated legalizing sports wager-
ing, which provoked concern, largely
among the major national sports
leagues, that more gambling would
lead to corruption and an erosion of
public trust in sports.
Acting on that fear, Congress
passed the Professional and Amateur
Sports Protection Act (PASPA), which
blocked states that had not already
legalized sports betting (namely, just
Nevada) from doing so in the future.
Congress justified this unprecedented
intrusion into state matters by claiming
a national interest in protecting the
integrity of sports.
Over the past three decades,
PASPA has proven to be a failure. The
sports gambling market in the U.S.
swelled from around $40 billion per
year in 1991 to an estimated $140
and $400 billion per year today, with
Americans filling out around70 mil-
lion bracketsduring March Madness
alone. Clearly, preventing states from
legalizing the activity has done little
to stop the spread of sports bet-
ting, as explained in my recent CEI
study,Time to End the Madness
around March Madness. What the
ban has done is prevent states from
legalizing sports betting, generating
revenue, and instituting real, legally
enforceable consumer protections.
Worst of all, the law treats adults like
COMPETIVE ENTERPRISE INSTITUTE

What the ban has
done is prevent
states from legalizing
sports betting,
generating revenue,
and instituting real,
legally enforceable
consumer protections.
children and makes criminals out of
otherwise law-abiding citizens.
The law is also unconstitutional.
As the State of New Jersey has
argued many times in court, the 10th
Amendment to the Constitution reserves
powers not delegated to Congress
to the states and to individuals. The
Constitution makes no reference to
giving Congress the power to prevent
states from legalizing certain types of
commercial activities, such as gam-
bling. The courts, however, have sided
with the sports leagues, who have sued
the Garden State each time it tried to
legalize sports betting, arguing that this
violated PASPA.
In October 2014, the New Jersey
legislature repealed the states laws
that explicitly prohibited sports gam-
bling at casinos and race tracks,
attempting to decriminalize but not
expressly legalize the activity. Again,
the sports leaguesled by the NCAA
sued. Disturbingly, federal courts have
sided with the leagues twice, agreeing
that PASPA not only barred states from
legalizing sports betting but even pre-
cluded them from modifying their own
laws in a way that appeared to conflict
with spirit of federal law.
Though courts have rejected the
argument that PASPA unconstitution-
ally prohibits state-based commerce,
the U.S. Supreme Court has indicated
interest in hearing New Jerseys
appeal, asking for the opinion of the
acting Solicitor General on the case.
Hopefully the Court will hear the case.
Otherwise, we are left with a big prob-
lemnot just for sports betting but for
any issue on which the states deviate
from Washington and attempt to repeal
their own laws.
The citizens of each state deserve
to have their interests well represented
by their own state lawmakers. And the
states should be protected from federal
legislators commandeering the will of
state lawmakers and citizens.
Meanwhile, PASPA has also done
nothing to protect the integrity of sports.
In fact, it has actually increased the
likelihood of match-fixing. In Europe
and much of the rest of the world where
sports betting is legal, sports leagues
rely on the gambling industry as an
early warning system. Bookmakers
can alert the leagues when they spot
signs of match-fixing and work with the
authorities to bolster game integrity,
to mutual benefit. In the U.S., bookies
who want to alert authorities to signs of
corruption cant do so without fear of
being prosecuted.
It is not the role of the federal
government to protect the reputation
of our sporting events or dictate the
types of wagering individuals may
engage in or states may authorize. It is
time for Congress to place its bets on
the American people and American
federalism by repealing PASPA and let-
ting states decide for themselves on the
question of sports betting.
Michelle Minton (michelle.minton@
cei.org) is a fellow at CEI. A version
of this article was originally published
by theAmerican Legislative Exchange
Council.

I, Whiskey: The Movie

COMPETIVE ENTERPRISE INSTITUTE C E I . O R G 13

 THE
GOOD
The Good: Court Criticizes
Schneidermans Evasion of
Open Records Law
A new court ruling criticizes New York
Attorney General Eric Schneidermans
illegal stonewalling of public records
requests. At issue in the case is the
key document related to a coalition
orchestrated by Schneiderman last
year that was aimed at shutting down
the climate science debate. The State
of New York Supreme Court handed
down a ruling on April 19, which
awarded attorneys fees to CEI in our
successful legal challenge to obtain
an official copy of Schneidermans
Common Interest Agreement, the
document behind his multi-state, anti-
free speech campaign. Even after the
agreement became available on the
Internet, Schneidermans office refused
to release an official copy of it.
In the ruling, the court character-
ized Schneiderman as having stone-
walled and as having completely
failed to explain his conclusory
reasoning for withholding the docu-
ment. It noted that the fee award was
particularly appropriate to promote
the purpose of the states Freedom
of Information Law. CEI sought the
agreement after having successfully
fought off a wide-ranging subpoena
from U.S. Virgin Islands Attorney
General Claude Walker, a member of
Schneidermans anti-speech coalition.
14 CEI.ORG
THE
BAD
The Bad: Glass-Steagall
May Return
On May 1, President Trump told
Bloomberg News that he was consid-
ering breaking up Americas biggest
banks. Im looking at that right now,
he said. Theres some people that want
to go back to the old system, right? So
were going to look at that. It was the
latest rumbling from this administration
about government action against banks.
Trumps chief economic adviser, Gary
D. Cohn, has previously talked about
bringing back the Glass-Steagall Act,
a Depression-era law that separated
investment and commercial banks but
was partially repealed in 1999 by the
Gramm-Leach-Bliley Act.
Whatever one thinks about break-
ing up the big banks, thats not what
bringing back Glass-Steagall would
do, warns CEI financial policy expert
John Berlau. Re-imposing Glass-
Steagall restrictions would just prevent
banks of any size from dealing in
securities through an affiliate, hurting
their bottom line and denying consumer
choice. Regional and community banks
couldnt supplement their income with
other financial services, which is espe-
cially important during hard times, and
consumers couldnt receive brokerage
and insurance services from their com-
munity banks. Bringing back Glass-
Steagall would be destructive but for
small banks more so than big ones.
THE
UGLY
The Ugly: House GOP
Abandons Repeal of
Payment Card Price Controls
In May, House Republicans gave up
efforts to repeal a provision of the 2010
Dodd-Frank financial law that imposes
caps on the fees that banks and credit
unions place on debit card purchases.
The provision, known as the Durbin
Amendment, for its sponsor, Sen. Richard
Durbin (D-Ill.), enjoys the support of
large retailersincluding Walgreens,
which is based in Sen. Durbins home
state of Illinois.
All the evidence suggests the cap on
debit card interchange fees resulted in a
windfall for retailers who failed to pass
on savings to consumers, said CEI Vice
President for Strategy Iain Murray. The
result has been a net loss of around $25
billion a year for American consumers,
most of it born by low-income house-
holds. The House had a chance to right
this wrong, and they blew it.
A Home Depot executive bragged
on a stock analysts conference call that
price controls could add up to $35 mil-
lion per year to the chains bottom line,
said CEI Senior Fellow John Berlau. If
the Durbin amendment explicitly bars
banks and credit unions from recouping
the full cost of a debit card transaction
from a retailers, who pays these costs?
Consumers. The costs have been shifted
to them in the form of reduced benefits,
like free checking, and higher fees at
their banks and credit unions.
COMPETIVE ENTERPRISE INSTITUTE
 MediaMENTIONS
The Wall Street Journals editorial
board highlights the findings of
the 2017 edition of Ten Thousand
Commandments.
As if taxes havent been high
enough, the U.S. Government also
forced Americans to spend an eye-
watering $1.9 trillion in 2016 just to
comply with federal regulations. Thats
according to the latest annual 10,000
Commandments report released today
by Wayne Crews of the Competitive
Enterprise Institute. If it were a country,
U.S. regulation would be the worlds
seventh-largest economy, ranking
behind India and ahead of Italy, notes
Mr. Crews. He adds that our regulatory
tab is nearly as large as the total pretax
profits of corporations.
May 31, The Wall Street Journal
Senior Fellow John Berlau dis-
cusses the changing finance and
banking regulatory landscape
under the Trump administration.
Consumers, investors and entre-
preneurs have been winners under
Trump, said John Berlau, senior fellow
at the Competitive Enterprise Institute, a
free-market think tank. The banks that
want more freedom, that are innovative,
will be winners. The banks that want
government support for things like the
SIFI designation and use regulation to
block their competition are going to be
some of the losers.
April 26, CNBC
Research Fellow and Regulatory
Counsel Ryan Radia discusses
the Federal Communication
Commissions Chairman Ajit Pais
plan to eliminate net neutrality
rules.
The rigid rules that now govern
Internet providers forbid an array of
business models that could benefit
consumers, Ryan Radia, a research
fellow at the pro-business Competitive
Enterprise Institute, said in a statement.
Freezing todays Internet in place,
COMPETIVE ENTERPRISE INSTITUTE
with all its shortcomings, will preclude
the experimentation and bargaining
among companies that causes markets
to progress.
April 25, Fortune
The Washington Post highlights
CEIs campaign urging President
Trump to withdraw from the Paris
Climate Treaty.
On Tuesday, the Competitive
Enterprise Institute, a conservative
advocacy group, released an ad urging
Trump to jettison the Paris climate deal.
The ad includes footage of Trump on the
campaign trail, promising to cancel
the Paris deal.
Mr. President, dont listen to the
swamp, it goes on to say. Keep your
promise. Withdraw from the Paris cli-
mate treaty.
In a statement accompanying the
ads release, CEIs Myron Ebellwho
headed up Trumps EPA transition
teamsaid exiting the Paris agreement
is an integral part of the new adminis-
trations push to unravel Obama-era
environmental regulations.
April 19, The Washington Post
Center for Class Action Fairness
founder Ted Frank discusses how
plaintiff lawyers use class action
settlements to enrich themselves
at the expense of class members.
In general, this is a systemic issue
with class actions, where lawyers
structure settlements to benefit them-
selves rather than the class, said Ted
Frank, a lawyer and director of the
Center for Class Action Fairness at the
Competitive Enterprise Institute think tank
in Washington D.C. Its a consistent
problem.
Frank said judges who must approve
settlements in such cases sometimes
approve seemingly lopsided agree-
ments, despite laws designed to prevent
attorneys from structuring settlements to
benefit themselves more than the class.
April 5, The Boston Globe
C E I . O R G 15
The Wall Street
Journal reports
on the release of
Wayne Crews
latest study on
Regulatory Dark
Matter.
According toa
report out todayfrom
the indispensable Wayne Crews of the
Competitive Enterprise Institute, on top of
the thousands of rules the federal govern-
ment churns out, the feds have also been
issuing nearly 25,000 notices every
year telling Americans what to do in the
absence of any new law or regulation.
Mr. Crews also finds that not even federal
agencies can agree on how many fed-
eral agencies there are. Estimates range
from 61 to 443.
March 14, The Wall Street Journal
Senior Fellow Marc Scribner
discusses how increasing airline
competition may be the solution to
incidents of poor service:
As Marc Scribner of the Competitive
Enterprise Institute put it this week: If
American consumers wish to enjoy
improved service quality in air travel,
they should demand that Congress
repeal 90 years of anti-competitive
federal law. Less regulation of air travel,
not more, is the solution.
January 14, Los Angeles Times

...END NOTES
If You Build It, Taxpayers Will Pay for It Part I
The National Football League hates gambling so much
that it recently approved the Oakland Raiders move to Las
Vegas. But its a winning bet for Raiders owner Mark Davis,
who is essentially gambling with house moneyexcept
this time the house is the taxpayer. At $750 million, its the
largest direct public subsidy for a stadium ever granted,
and Clark County will soon be floating a bond to raise
all that money and raising hotel room taxes on the Strip
by 0.88 percent in order to pay back their debt hold-
ers over the next 30 years, notes Deadspin writer T. M.
Brown. Worse, this isnt an isolated case. Mercatus Center
researcher Michael Farren finds that by 1992, 77 percent
of all professional sports stadiums in the U.S. had been
financed by taxpayers. Within a decade, nearly half of all
professional sports franchises were once again request-
ing public funds for new facilities or were already in the
construction or renovation process.
If You Build It, Taxpayers Will Pay for It Part II
Local politicians often tout municipal broadband as key
to their regions economic development. Yet, the results to
date are less than stellar. In a new study, Christopher Yoo
and Timothy Pfenninger of the University of Pennsylvania find
that few city- and county-owned broadband networks in the
U.S. are earning back predicted revenue, and many threaten
to jeopardize other local spending priorities because of
cost overruns. Examples include the Minnesota city of
Monticello, which established a municipal fiber network in
2009, expecting it to eventually turn a profit. Instead, the
network, known as FiberNet, has lost millions of dollars,
suspending payments to bondholders in 2012. The service is
still operating it at a loss, running a $100,000 operational
deficit in the last half of 2016 alone. Today the network costs
$5,549 per household, or $16,875 per subscriber.
16 CEI.ORG
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PAID
Permit 425
Southern MD
D.C. Transit Agency Making Delays More Aromatic
The Washington, D.C.-area Metro subway system
which The Washington Post called a national embarrass-
ment last yearhas its share of well-known troubles. From
service interruptions to fires so frequent they led a local
resident to create the website ismetroonfire.com, transit
agency officials have their work cut out for them. So in an
effort to improve riders experience, Metro is installing
air fresheners. The fresheners, installed on Metros green
line, come in two scents: cucumber melon and mango. The
results? Metro spokeswoman Sherri Ly said that customer
surveys found an increase in rider satisfaction with the level
of railcars cleanliness. On social media, rider reaction has
been mixed. While some have said they like the new train
smell, one rider wrote to the Post, asking, Why not just
clean the trains really well with nontoxic cleaning agents
and get rid of the moldy, mildewed, smelly carpeting on
many trains?
Excuses, Excuses
On May 24, Vermont Governor Phil Scott became the
first state executive to veto a bill to decriminalize marijuana.
His reason? The supposed lack of a reliable roadside test to
determine driver impairment from THC, the intoxicant found
in marijuana. But the absence of a reliable roadside sobriety
test for THC is a poor excuse for striking down the legisla-
tion. Reason magazine columnist Jacob Sullum recently
reviewed several Automobile Association of America (AAA)
reports that looked at THC-related traffic incidents. One
report was based on THC-related traffic incident data in
Washington State between 2005 and 2014 (Washington
and Colorado legalized recreational marijuana in 2012).
While AAA reported a 30-percent increase in THC-related
traffic incidents events over that period, 66 percent of drivers
who tested positive for THC in fatal accidents also tested
positive for other substances. Irresponsible behavior, it
seems, doesnt depend on access to any one substance.
COMPETIVE ENTERPRISE INSTITUTE