Author: CS Admin

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folly free trade & free markets general freedom moral hazard nannyism national politics & policies property rights responsibility too much government

What’s the Big Deal?

Standard Oil, monopoly, merger, antitrust, Aetna, CVS Health Corp

Big news: in a $69 billion deal, CVS Health Corp. plans to buy Aetna Inc. The AP story by James F. Peltz says the move “would shake up healthcare industry.”

Should we worry?

Because corporations aren’t cancerous, growth and consolidation are not to be feared as such. 

But speaking of cancerous growths … the federal government will not likely take the news of the merger with the tranquility of a Taoist sage. 

Over at Forbes, last month, Bruce Japsen predicted that the deal wouldn’t go through, arguing that “a full-​blown merger of the healthcare giants would be complicated and unlikely given recent antitrust scrutiny in the sector and given that the drugstore chain is already going into business with an Aetna rival, Anthem.”

Government antitrust to the rescue?

No. We may have been schooled to believe that antitrust “protects competition,” but it has always limited competition, instead. Antitrust was always about fear — of bigness. It was definitely not designed to help consumers. The classic case is the infamous break-​up of Standard Oil, which produced more fuel while lowering prices — even as it grew humongous.* Standard Oil grew because it satisfied consumer demand. Which is what businesses are for. 

And yet government broke it to pieces, using antitrust rationales, for the benefit of some producers, some businesses.

Think of it as crony capitalism in action.

So, my remaining question runs like this: is the CVS/​Aetna merger a response to pure market demand, or as a way to wiggle around insane state and federal regulations?

Health care in America is sick. The merger is not likely the cure. But it would not kill the patient. 

We have government for that.

This is Common Sense. I’m Paul Jacob.

 

* For background, consult the studies of economist Dominick T. Armentano.

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Categories
Accountability folly general freedom government transparency initiative, referendum, and recall local leaders moral hazard national politics & policies term limits

Illinois’s Chicken-​and-​Fish Supreme Court

Illinois, Supreme Court, term limits, initiative, democracy, gerrymandering

A constitution is the law of the land only to the extent that it’s enforced. And in Illinois, the right of citizen initiative — provided for in the state constitution — is not enforced.

The constitution’s wording is explicit: “Amendments … may be proposed by a petition signed by a [specified number of electors].… Amendments shall be limited to structural and procedural subjects contained in Article IV.”

Does that Article IV discuss the subject of election procedures, including eligibility requirements, thereby opening the door to a citizen-​initiated term limits amendment? Yes, it does. Section 2, subsection ©, for example, specifies citizenship, age, and residency requirements.

Yet the Illinois Supreme Court has repeatedly chucked the results of effective petition drives to get a state legislative term limits question on the ballot.

The justices rely on the venerable Fallacy of Tortured Misreading. 

Former Illinois legislator Jim Nowlin recently pointed out that in 1976, the court concluded that the wording about how initiative proposals “‘shall be limited to structural and procedural subjects’… meant a proposal must make both kinds of changes.” The lone dissenter on the court “opined to the effect: When I see a restaurant sign that says, ‘We have chicken and fish,’ that doesn’t mean you have to order both chicken and fish!”

The right of citizen initiative is a crucial means of reforming government when those in government won’t reform themselves. The citizens of Illinois have that right. But, for now, they also don’t.

That ain’t Common Sense. I’m Paul Jacob.

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folly government transparency media and media people national politics & policies too much government U.S. Constitution

Peel Back the Onion

The Onion, satire, humor, CFPB, bureaucracy

Yesterday, an Onion title caught my attention: “Hooded Members of Congress Drown Another Love Child in the Potomac to Prevent Affair from Getting Out.” This is not funny because it is true, but because it is so close to the truth. Too close for comfort.

A similar story, the day before, sported a title so sublime that you do not really need to read further: “Al Franken Tearfully Announces Intention To Step Down From Role As Harasser Of Women.” The week before that, another satire gave us this extravaganza: “Paul Ryan Announces New Congress Sexual Harassment Training Will Create Safe Work Atmosphere, Plausible Deniability.”

But sex scandals are easy. If The Onion were seriously in the satire biz, the farcical-​on-​the-​surface nonsense of the Consumer Financial Protection Bureau brouhaha that I wrote about on Tuesday would get incisive treatment as well.

My advice to Onion writers? Don’t go halfway into the problem, like David A. Graham does in The Atlantic: “The Fight Over the CFPB Reveals the Broken State of American Politics.” Sure, that’s true. But concluding that “neither party sees the political process as effective in resolving these basic issues is worrying” hardly goes far enough, and the next line — “the fact that they might both be right is worse still” — shies from the full extent of the predicament.

The Constitution was designed to avoid problems like the CFPB nonsense. Start there. Something like this comes close: “Politicians Shocked, Shocked to Discover That an Un-​Constitutional, Partisan Bureau Becomes Subject to Constitutional Dispute Along Partisan Lines.”

I have confidence that, if The Onion went there, it’d be funnier. 

Even without a sex angle.

This is Common Sense. I’m Paul Jacob.

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Categories
Accountability free trade & free markets insider corruption moral hazard national politics & policies porkbarrel politics responsibility too much government

Cry Me an Amazon

cronyism, Amazon, taxpayers, black hole

My idea of a “free market” is not our politicians’. Their idea is to give away free stuff to their new and old business buddies … at everyone else’s expense. 

That sort of “crony capitalism” has been writ large per Amazon’s search for a location for a second headquarters (HQ2). The world’s biggest retailer — valued higher on the market than all other major retailers combined — announced it would spend $5 billion and bestow 50,000 new jobs on HQ2’s locale. Subsequently, 238 cities, states and provinces in the U.S., Canada, and Mexico offered to take from their current citizenry to give unfairly to Amazon.

Chicago’s proposal would allow Amazon to keep the income taxes their employees pay. Seriously. This “personal income-​tax diversion” would add up to over a billion dollars for the company.

New Jersey state government offered a cool $7 billion in subsidies should Amazon choose to locate in Newark.

Seattle Times columnist Danny Westneat described this sorry spectacle of subsidy as not so much a corporate “takeover” as a government “surrender.”

The most egregious example, though, has to be Fresno, California, where the city “promises to funnel 85 percent of all taxes and fees generated by Amazon into a special fund.… overseen by a board, half made up of Amazon officers … supposed to spend the money on housing, roads and parks in and around Amazon.”

“Rather than the money disappearing into a civic black hole,” explained Larry Westurland, Fresno’s economic development director, “Amazon would have a say on where it would go.”

Selling out the taxpayers? Moolah in the millions. Referring to a normal city budget as a “black hole”? Priceless.

This is Common Sense. I’m Paul Jacob.

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Categories
Accountability general freedom government transparency ideological culture insider corruption moral hazard nannyism national politics & policies responsibility too much government U.S. Constitution

Invulnerable Government

cfpb, Consumer Finance Protection Bureau, director, Richard Cordray, Mick Mulvaney, deep state, administrative state, bureaucracy

As of this week, there are two heads of the Consumer Financial Protection Bureau.

Two claimants to the throne, so to speak. 

The bureau’s previous director, Richard Cordray, resigned last week, and as he left he appointed a deputy director, Leandra English. Ms. English sent out a nice Thanksgiving email, billing herself as “Acting Director.”

Meanwhile, in advance of Cordray’s exit, President Trump appointed Mick Mulvaney to fill the role. Mulvaney showed up at work yesterday and took possession of the director’s office. He ordered a hiring freeze … and brought donuts.

It gets juicier. English has filed suit against the president and his appointee, claiming to be, herself, the directorship’s rightful heir. She cites the enabling legislation, which allowed for deputization by the director. And she cites her commitment to the agency’s mission, of which Mulvaney and Trump have none.

Republicans generally regard the agency as having gone rogue. 

And the squabble over the directorship sure seems to validate that charge. 

The legality? Presumably, the legislation that established the agency — which deliberately insulated the CFPB from oversight by funding it from the Federal Reserve — does not void an established law, the Vacancies Act, which does allows the president to fill vacated posts.

Sen. Elizabeth Warren has taken up English’s side in the dispute, because she believes in the agency’s mission.

Now, I get it: to make government as impregnable as a high mountain fortress is an idea that many folks flirt with, from time to time. But the results are always the same: government secure from democratic checks and constitutional balance.

Come on, Democrats! Give democracy a chance.

This is Common Sense. I’m Paul Jacob.

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Categories
Accountability crime and punishment government transparency incumbents term limits

Power Abuse

term limits, sexual abuse, sexism, accountability, settlements, taxpayer, hush money

At the core of sexual harassment and misconduct is an unchecked power dynamic permitting the abuse. No surprise, then, that our unaccountable Congress is rife with it. 

What to do?

Our sicko congressmen must immediately stop using taxpayer funds to provide “hush” money to keep their victims from telling their stories, as I argued at Townhall yesterday.

Mandatory anti-​sexual harassment training for all congressional employees? Normal folks don’t need special training to avoid acting in despicable ways, and as far as protecting employees goes, such training seems to serve perpetrators more than victims.

One thing Congress won’t do in response? Slap term limits on themselves. 

But term limits, in this as in other forms of corruption, would be very beneficial. 

First, they would mercifully limit the duration of any abuser’s reign. There is indeed some value here. 

But requiring rotation in office creates another critically helpful impact. The expectation that a creep congressman will continue to wield power plays a major role not only in the calculations of that abuser, but also sometimes in the calculus of the victim … especially regarding the fear of coming forward. 

And a limited time in power also has its affect on the thought processes of those around the congressmen, people who might be more likely to do the right thing in reporting misbehavior if they didn’t view their own advancement as so closely tied to the advancement of the member of Congress for whom they work. 

But remember, Congress won’t impose term limits on themselves. That’s our job. 

This is Common Sense. I’m Paul Jacob. 

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