Posts Tagged ‘Government’


Collapse of Global Warming

February 18, 2010

Collapse Continues

IBD: 17 Oct. 2010

Climate Change: The scientific “consensus” that man is warming the planet is cracking, and so is a group that was going to push for cap-and-trade. Some business members no longer feel threatened by the government.

Oil giants ConocoPhillips and BP and heavy equipment maker Caterpillar said Tuesday they’d be leaving the U.S. Climate Action Partnership, described on IBD’s front page as “a coalition of green groups and leading corporations pushing for a cap-and-trade bill to curb emissions of carbon dioxide.”

IBD on Wednesday reported that the three corporations “indicated that their leaving was based on disputes within USCAP over the direction the legislation was taking in Congress,” that it has become “now tilted toward coal-based energy producers.”

We’re not as diplomatic as these companies, so we can provide a more plausible explanation: They see the agenda of the global warming alarmists crumbling and have determined they don’t have as much to fear from government regulation as they once did.

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Cartoon: Out of Control Spending

October 26, 2009


More Bloomin’ Czars

August 24, 2009

More Bloomin’ Czars


Big Government: Ron Bloom, who heads the government’s auto task force, may soon have a new job. As Bloomberg reports, the White House wants him to become a new de facto manufacturing czar. What next?

Read More: Business & Regulation

Once in power, Democrats love nothing more than finding a problem so they can create a new level of government to deal with it. Even if there’s no problem, they will — pardon the phrase — manufacture one.

So it is with the possible appointment of Bloom, a former United Steelworkers union adviser who now heads the U.S. auto task force, to be a kind of national industrial policy czar.

The manufacturing sector has indeed been hit hard by the downturn. But so has the rest of U.S. industry. The only real growth sector, as the Rockefeller Institute reported Thursday, is government. While private jobs have shrunk 6.9 million since the start of the recession, state and local governments have added 110,000 positions.

Problem is, President Obama signed a $787 billion stimulus bill in February and vowed to create 3.5 million jobs over the next two years. And a major part of his support comes from unions.

His “stimulus” isn’t working, and he must be seen as “doing something.” Thus, Bloom gets named factory czar.

The question naturally arises: Do we really need a factory guru, especially one whose expertise is in advising labor unions — the cause of much of the U.S. steel and car industries’ woes?

The obvious answer is no. This is just another attempt to revive the long-discredited idea of industrial policy — the notion that markets are inefficient and unfair, and the economy can best be managed by government “experts.”

In the case of manufacturing, it isn’t as sick as we’ve been led to believe. In fact, total value added by the nation’s factories in 2008 hit a record $1.64 trillion for a gain of 21% since 2003.

And despite talk of the U.S. losing its industrial might, we still make up 25% of the world’s manufacturing value added — nearly 2 1/2 times China’s output, U.N. data show.

True enough, manufacturing has lost jobs in recent years. But most of the decline is due to rising productivity. Since 1990, factory output has soared 44%, while the number of factory jobs has fallen 32%. This may be the greatest productivity boom since the Industrial Revolution — an economic triumph rather than a tragedy.

Do manufacturers need a bureaucrat as boss? Or even as their advocate? Of course not. They need what the rest of us need — a healthy private economy. Create conditions for that — with lower taxes, fewer regulations and freer trade — and factories will flourish. And Obama’s 3.5 million jobs might not be such a pipe dream.


Health Care Industry Shouldn’t Be Taken Without Due Process And Compensation

August 12, 2009

IBD      6 Aug 09

Under the Fifth Amendment, if the government takes property, the holder is entitled to due process and compensation. Usually, this concept of eminent domain applies to real estate seized for a public purpose.

What if the seizure is not of real property, but a business? The broad concept is still the same: If the government takes your property, you are entitled to your day in court and adjudicated compensation.

What if the government uses its cash to muscle into your territory and forces you to surrender customers by underpricing you for the sake of the “uninsured”?

Further, what if the government passes such stringent regulations that only a few large insurers already in bed with the government can survive?

The current House medical insurance bill and the purported Blue Dog compromise constructively take property without due process of law and compensation. Speaker Nancy Pelosi calls the insurers “immoral” and “villains” and contends “they are doing everything they can to stop a public option.”

Why is someone a villain if he doesn’t agree to being robbed?

The speaker has forced the question: Who is the villain?

The medical industry is much more complicated than it needs to be. The terrible compromises made by large insurers with big government are well beyond the scope of this article.

The criticism of proposed government expansion of medical insurance was muted when the insurance industry thought it was going to keep its preferred tax status and pick up an extra 46 million subsidized Medicare Plus-type clients, and the pharmaceutical companies and the AMA had been squeezed or bought off enough.

But reality bites. The insurers are finding the government is a hungry partner with an insatiable appetite, and next up on the menu is their prime territory.

The proposed House legislation contemplates the government will offer competing health insurance. The law would bar some health insurance companies from adding new customers, which ensures that through attrition the firms will liquidate their business.

The Blue Dog “compromise” doesn’t quite do that, but it does sanction overwhelming public sector competition. President Obama has disingenuously criticized critics of his bailout plans by saying if the government is such a bad business manager, why do they fear us as a competitor?

Well, all businesses fear predatory monopoly pricing in a competitor, especially a stupid one with the ability to print dollars and set regulations a competitor that can easily bankrupt you and doesn’t care about losing money.

And like shareholders of Ford, shareholders of the private insurers will have their tax dollars used to shore up their ignorant but powerful competitor.

America was built on real competition, based on supply and demand and real price discovery. The original sin of the health insurance industry was in its birth as a non-taxable employment benefit. How did that happen?

Just as Franklin Roosevelt tried to support falling prices during the Depression (making it worse), the government disguised rising wages during World War II by labeling medical insurance nontaxable. Cash wages were deductible by the employer, taxable to the employee and portable.

Once health insurance was deductible by the employer, but nontaxable to the employee, health insurance became nonportable. Yes, the industry grew faster than others, but with twisted incentives that severed the consumers from the producers, and increasingly without price discovery. Without true price discovery, no one can really compete and medical insurance is misallocated.

Recently, the CBO said the House plan would be more expensive for the country than the limited form of competition we have. Real competition is the only way to reduce costs on a sustainable basis.

The health insurance industry has a public market capitalization of about $100 billion, down from much higher amounts a while back. The CBO never gave any consideration to the constitutional requirements of providing eminent domain reimbursement to the shareholders of the health insurers whose property is being taken away from them bit by bit.

If it did, the scales of justice would tip even further against the proposed law. The truly private portion of the health insurance industry would be entitled to something like an additional $50 billion to $100 billion to compensate them.

If the government were judged by its own laws, a case could be made for antitrust damages arising from predatory pricing by a monopoly. In the House bill, the government self-consciously exempts itself from just such liability.

At the very least, the shareholders of the private insurers that stand to be driven out of business deserve compensation.

Anything less is slow motion theft by the real villains.

our comments- and the real villains are?

• Singer is the manager for the Congressional Effect Fund.


Are We In America Or Amerika?

August 12, 2009


10 Aug 09

Public Debate: Democrats, bloodied over their attempt to force health care “reform” on Americans, are looking more unreasonable and hysterical by the day. This isn’t healthy for the republic.

Their increasing anxiety and fear of failure are typified in the words of the leader of their party, who wants Republicans to keep their mouths shut while he “fixes” health care.

“I don’t want the folks who created the mess to do a lot of talking,” the president said Thursday at a political rally in Virginia. “I want them to get out of the way so we can clean up the mess.”

So much for the promises of bipartisan lawmaking. So much for open discussion. So much for understanding who really caused the “mess” in the first place. Like Al Gore claiming the debate about global warming is over, the White House simply wants to shut down dialogue over who controls more than one-seventh of the economy.

House Speaker Nancy Pelosi has yet to come out in favor of repressing speech. But she’s inclined to ignore it. The San Francisco Democrat vowed Thursday in Denver that the swelling public opposition to government-run health care would not persuade party leaders to back down.

“The plan for August is to have a discussion, to listen carefully to what people are saying, what ideas they may have to improve the legislation as it affects them,” Pelosi said. In other words, Americans can suggest changes, but the elitists in Washington will not withdraw plans to take over the best health care system in the world.

Earlier in the week, Senate Majority Leader Harry Reid walked the same line as Pelosi, making it clear that the Democratic leadership had no intention of listening to fed-up voters.

“In spite of the loud, shrill voices trying to interrupt town hall meetings and just throw a monkey wrench into everything,” he said, “we’re going to continue to be positive and work hard.”

By Thursday, Reid was saying that protesters were trying to “sabotage” the democratic process, which apparently in his world is a place where there is no opposition to the Democrats’ process of invading every corner of private life.

On the same day, Sen. Blanche Lincoln, Democrat of Arkansas, said she thought the protests against government health care at lawmakers’ town hall meetings were “un-American and disrespectful.” Hours later, she retracted the statement, probably less concerned about the inaccuracy of her statement than mindful of the fact that she had just insulted a large group of voters who can unseat her.

Truth is, there’s nothing more American than revolting against heavy-handed authority, be it a long train of abuses from a king or the lawmaking of elected officials with strong authoritarian urges. This is a nation founded on independence, and there is a large portion of it that wants to retain that priceless heritage.

This seems to confuse some lawmakers. Rep. Brian Baird, D-Wash., can’t understand that what he’s watching is a freedom movement. In his eyes, the protesters are Nazis — or almost.

“What we’re seeing right now is close to brownshirt tactics,” Baird said Wednesday, by way of explaining why he was refusing to face his constituents directly in town hall meetings and would instead hold telephone town halls.

Voters’ deep anger is justifiable. They have every right to disrupt and shout down public figures who, as the protesters can be heard chanting, work for them. At dispute is not a mere difference of opinion that can and should be discussed in a civil manner, but a fundamental question of who is in charge of peoples’ lives.

We are not advocating violence, though coercive government is at its core violent as the state is required to resort to force to ensure that its directives aren’t violated.

But we do support our fellow citizens’ right to express their rage at an injustice, particularly if it makes lawmakers uncomfortable. Shouldn’t Americans bristle when their independence is threatened, when a federal official, in this case White House deputy chief of staff Jim Messina, says party leaders “will punch back twice as hard” when voters merely show their displeasure?

The freedom the protesters are defending can sometimes be messy and imperfect. A lack of freedom, however, is eternally oppressive. It is an unrelenting prison that poisons the human spirit, even when cloaked in allegedly humane programs such as government-run health care.


Logic Gets Lost Amid Hysteria About ‘Reform’

July 21, 2009

IBD   21 July 09

by Thomas Sowell

Is there a coherent argument for government-controlled medical care or are slogans and hysteria considered sufficient?

We hear endlessly about how many Americans don’t have health insurance. But, if we stop and think — which politicians hope we never do — that raises the question as to why that calls for government-controlled medical care.

A bigger question is whether medical care will be better or worse after the government takes it over. There are many available facts relevant to those crucial questions but remarkably little interest in those facts.

There are facts about the massive government-run medical programs already in existence in the United States — Medicare, Medicaid and veterans’ hospitals — as well as government-run medical systems in other countries.

None of the people who are trying to rush government-run medical care through Congress before we have time to think about it are pointing to Medicare, Medicaid or veterans’ hospitals as shining examples of how wonderful we can expect government medical care to be when it becomes “universal.”

As for those uninsured Americans we keep hearing about, there is remarkably little interest in why they don’t have insurance. It cannot be poverty, for the poor can automatically get Medicaid.

In fact, we already know that there are people with substantial incomes who choose to spend those incomes on other things, especially if they are young and in good health. If necessary, they can always go to a hospital emergency room and receive treatment there, whether or not they have insurance.

Here, the advocates of government-run medical care say that we all end up paying, one way or another, for the free medical care that hospitals are forced by law to provide in their emergency rooms.

But unless you think that any situation you don’t like is a reason to give politicians a blank check for “change,” the relevant question becomes whether the alternative is either less expensive or of better quality. Nothing is cheaper just because part of the price is paid in higher taxes.

Such questions seldom get asked, much less answered. We are like someone being rushed by a used car dealer to sign on the dotted line. But getting stuck with a car that is a lemon is nothing compared to signing away your right to decide what medical care you or your loved ones will get in life-and-death situations.

Politicians can throw rhetoric around about “bringing down the cost of health care,” or they can even throw numbers around. But the numbers that politicians are throwing around don’t match the numbers that the Congressional Budget Office finds when it analyzes the hard data.

An old advertising slogan said, “Progress is our most important product.” With politicians, confusion is their most important product. They confuse bringing down the price of medical care with bringing down the cost. And they confuse medical care with health care.

Nothing is easier than for governments to impose price controls. They have been doing this, off and on, for thousands of years — repeatedly resulting in (1) shortages, (2) quality deterioration and (3) black markets. Why would anyone want any of those things when it comes to medical care?

Refusing to pay the costs is not the same as bringing down the cost. That is why price controls create these problems. When developing a new pharmaceutical drug costs roughly a billion dollars, you are either going to pay the billion dollars or cause people to stop spending a billion dollars to develop new drugs.

The confusion of “health care” with medical care is the crucial confusion. Years ago, a study showed that Mormons live a decade longer than other Americans. Are doctors who treat Mormons so much better than the doctors who treat the rest of us? Or do Mormons avoid doing a lot of things that shorten people’s lives?

The point is that health care is largely in your hands. Medical care is in the hands of doctors. Things that depend on what doctors do — cancer survival rates, for example — are already better here than in countries with government-run medical systems. But if political rhetoric prevails, we may yet sell our birthright and not even get the mess of pottage.


Give The Gov’t A Year To Exit Private Sector

July 21, 2009

IBD 22 June 09

By Sen. John Thune

Last fall’s economic downturn and liquidity crisis were very serious. However, in the course of responding to them, the government abandoned its initial plan of action to purchase toxic assets and instead took to buying ownership stakes in a large number of private companies. 

An attempt to respond to an emergency quickly changed into something unanticipated by most Americans and most members of Congress. When the dust settled, the federal government had become a major investor in more than 500 private American businesses.

I share the concerns of those who are alarmed at the federal government’s increasing role in our economy, both through spending enormous sums of borrowed money and unprecedented intervention into private businesses.

A poll released last week by Rasmussen Reports found that 80% of Americans want the federal government to sell its stakes in auto companies as soon as possible and 71% want the federal government to sell its stakes in banks as soon as possible.

The public opposition to government ownership of private businesses is well-founded.

The whole adventure undercuts the free-market principles that have guided our economy since our nation was founded.

The fundamental assumptions about how a market economy should function are contradicted by insertion of government bureaucrats into business decisions and by a market where government-favored firms compete against nonfavored, privately owned firms. 

A market economy can be compared to a sporting event, where teams play by rules enforced by a neutral referee.

In a market economy, the government serves as the referee, enforcing the laws adopted by Congress or the private contracts freely entered into by private firms.

When the government also becomes a player, it can no longer serve as an impartial referee; the government’s team will be favored. The fundamental dynamics of competition are disrupted.

Today, we are witnessing the behavior of companies for which the president of the United States is serving as a de facto CEO and Congress is serving as a 535-member board of directors. Business decisions are clouded by political calculations.

This arrangement does not inspire confidence. The American people realize that elected officials and government bureaucrats are ill-equipped to run banks, insurance companies and car manufacturers.

Last week I introduced legislation along with a dozen of my colleagues that would scale back the government’s involvement in the private sector.

My bill, the Government Ownership Exit Plan Act, would prohibit the future purchase of new or additional ownership interests in private firms through the Troubled Asset Relief Program (TARP).

Of equal importance, my bill would make the federal government end its ownership of private businesses acquired through TARP by July 1, 2010.

My bill would require the Treasury Department to sell any ownership interest such as warrants or stocks and use any revenue from the sale of those assets to reduce the national debt.

This straightforward legislation would also prohibit the federal government from making or unduly influencing management decisions, including appointing senior executives or board members.

The federal government does not have the knowledge or the resources to continue trying to run successful companies, and the American taxpayers deserve better.

Nobody understands this better than the Chamber of Commerce, the world’s largest pro-business advocacy group, which has voiced its support for my new legislation.

To reverse the alarming trend toward government ownership of private business, it’s important to move quickly.

Sadly, the Treasury secretary, who recently testified before the Senate Banking Committee, stated he has no such plan when it comes to divesting the federal government’s ownership stake in private firm. 

If we do not adopt an exit strategy, we risk government ownership becoming a permanent state of affairs. 

Increased government control of private businesses threatens the fair competition and economic freedom that Americans have enjoyed throughout our nation’s history.

A growing number of individuals are rightfully leery of the government’s ability to effectively manage the taxpayer money that has been diverted into private entities, but without congressional action the intervention will continue unchecked.

The Government Ownership Exit Plan Act is an important first step toward restoring the limited role of government in the economy.

In the weeks ahead I will work to see that this matter is considered by the full Senate.

Thune is the junior senator from South Dakota.