The military will limit the use of third-party accusations when investigating homosexuality among troops, in the Pentagon’s first substantive effort to ease enforcement of the “don’t ask, don’t tell” policy, which President Barack Obama wants repealed.

The new measures, which take effect immediately, will make it harder for the military to investigate homosexual troops who were outed against their will.

Not enought of a change, but a step in the right direction.

SACRAMENTO, Calif. — When California voters head to the polls in November, they will decide whether the state will make history again – this time by legalizing the recreational use of marijuana for adults.

If this measure passes, the ramifications could be far-reaching, and not just for drug policy.

Marijuana is illegal under both state and federal law.  Repealing California’s prohibition does not repeal federal prohibition.

So what will the federal government do if California legalizes?

If the Feds do not intervene, it suggests that states can ignore federal laws they do not like, such as Obamacare. That’s not an outcome the administration desires, so it will make some attempt to enforce the federal law.

California will then challenge that enforcement, all the way to the Supreme Court, on 10th Amendment grounds:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

The federal government will argue in response that marijuana cultivation and use, even if entirely within California, is “interstate commerce” and that the federal government has the power to regulate such activity under the Interstate Commerce Clause.

If the Supreme Court rules for the federal government, the Feds can then try to enforce prohibition despite California’s objections. A similar situation occurred under Alcohol Prohibition, since New York, among other states, did not adopt state-level prohibition. The results were not impressive.

If the Supreme Court rules against the federal government, it will open the door for a constitutional challenge to virtually every federal economic policy enacted since the New Deal.

This could get interesting; stay tuned!

VIENNA—The U.S. has backed away from pursuing a number of tough measures against Iran in order to win support from Russia and China for a new United Nations Security Council resolution on sanctions, according to people familiar with the matter.

Conservatives will presumably give President Obama a hard time for this move, but I have no objection. This is not because I have a benign view of Iran; it is no doubt determined to acquire nuclear weapons, and may be getting close.

But sanctions do not seem to have much impact on such regimes; they find ways to circumvent the restrictions. So sanctions just make it easier for a totalitarian regime to convince its citizens that the world is against them.

PARIS–France is backing down from a plan to tax carbon-dioxide emissions that had been a central plank of President Nicolas Sarkozy’s push for a more prominent role in the global fight against climate change.

The plan, launched last September, has been on the back burner since being ruled unconstitutional in December. Mr. Sarkozy’s government had insisted a reworked tax would nonetheless go into force by July.

Leading conservative legislator Jean-François Copé said after meeting the prime minister Tuesday that they agreed that any carbon tax “would be Europe-wide or not [exist] at all,” instead of being a French-only tax.

This illustrates why climate agreements are unlikely to work. No country will reduce emissions unless it knows other countries will do the same. Yet enforcement of multi-country agreements is problematic.

The difficulty is even greater because, rightly or wrongly, many people are not convinced that the warming threat justifies significant emissions reductions.

What’s the implication? If you believe warming is a major problem, you should be depressed. If you think warming or its costs have been exaggerated (my view), you should be grateful that coorindation problems are hard!

For months, Wall Street banks and the troubled automakers feverishly protested that their top executives would flee if they were not lavishly rewarded for their talents. New data, however, suggests the departures were more of a trickle than a flood.

Of the 104 senior executives whose pay was set by the federal pay regulator in the last two years, 88 executives, or nearly 85 percent, are still with the companies even though their pay was drastically cut back, according to people briefed on the government data.

One interpretation of these facts is that executives’ willingness to supply their talents is not that sensitive to compensation over the range in question.

Another interpretation is that financial firms have discovered ways to compensate executives in ways that do not run afoul of the limits, such as promises of greater compensation “when the heat dies down.”

These data, moreover, tell us at most about the short-run response of executives to pay limits. Over a longer period, the response could be much greater (assuming the restrictions continue).

TAMPA — The drive from Orlando to Tampa takes only 90 minutes or so. Despite the short distance, the Obama administration awarded Florida $1.25 billion in stimulus money to link the cities with a fast train to help kick off its efforts to bring high-speed rail service to the United States.

The Florida train would indeed be high speed — as fast as 168 miles per hour. But because the trains would make five stops along the 84-mile route, the new service would shave only about half an hour off the trip.

Time-pressed passengers may also find themselves frustrated at the end of their trip. Neither city is known for great public transportation, so travelers may discover that they have taken a fast train to a slow bus.

In other words, this project is unlikely to make sense from a standard cost-benefit perspective. That is especially true because the cost estimates are probably being low-balled.

So is this spending good for the economy? Under the strict Keynesian logic, yes, since that logic holds that producing widgets and throwing them in the ocean is effective stimulus.

Do we really believe this?

I think the answer is, “it depends.”

If the economy is recovering at a good rate by October (e.g., an unemployment rate below 8%), then my hunch is that the Democrats will do just fine. The main costs of Obamacare take decades to really kick in, so these will not be salient in the next six months. Democrats will tout the aspects people like, some of which kick in right away, and the Republicans will look like Grinches or sore losers for objecting. 

If the economy is still limping along in October (e.g., unemployment above 9%), then all bets are off.

The uncertain line between hope and despair divides this exurb of Phoenix, where the trim stucco houses used to sell so briskly. …

On one side are people like the Setbackens, Gary and Cissie, who moved here from Washington State and, with prudence, have managed to pay their mortgage bill month after month. On the other side are those like Kelley Carter, who never dreamed that home prices would fall so hard, and got in over their heads. …

Arizona is one of five states that, with money from Washington, hopes to help at least some of these people hold on to their homes.

The idea is as controversial in Washington as it is here. Do the neighbors next door who lived beyond their means — the ones who, say, bought that house they could not afford, or who binged on home equity loans to buy new cars and flat-panel TVs — really deserve to be bailed out with taxpayer dollars?

You can guess my answer. In addition to the inequity between existing homeowners, the federal program induces delay in putting foreclosed homes back on the market, where more deserving households would  be able to purchase them.

In commenting on Obamacare, Greg Mankiw writes that

Arthur Okun said the big tradeoff in economics is between equality and efficiency. The health reform bill offers more equality (expanded insurance, more redistribution) and less efficiency (higher marginal tax rates).

This perspective is undoubtedly correct in the short term, but it is less obvious in the long term. The rich will find ways to circumvent the rationing and other restrictions that a government-run health care system creates – such as by utilizing private clinics outside the government system – while the poor will have no choice but to accept the crummy government health care. Thus the exact distribution of who gets how much will surely change, but not necessarily in the direction of more equality.

In my view, the latter.

Why? Because ObamaCare will kill innovation. Other rich countries have survived socialized medicine with only bad, not horrendous, results because they free-ride on the innovation produced here.

Along with Medicare, ObamaCare means that federal expenditure on health insurance will increase rapidly, and the political response will be to slash payments to providers. This will destroy innovation here as well, and the whole world will suffer.

Addendum: Apparently I did not explain myself well in this post.  My position is exactly the interpretation offered by Eric Hagan in the comments:

if you take the profit motive out of health care, you destroy the incentive to innovate. We’ll get the same level of innovation you see out of utility companies.

And here is one piece of evidence that innovation is greater here than abroad: zillions of people want to train at U.S. medical schools and hospital residency programs, but not the reverse.