Category: too much government

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free trade & free markets too much government

No More Woolworths

The New York Times offers summer internships at $900 per week. From what I’ve gathered, most other editorial and journalistic internships don’t pay nearly that much.

Many pay nothing.

So why would anyone work for nothing? Well, for experience.

Thomas Sowell, in his recent book Applied Economics, tells the story of a young man named Frank, who applied for a position in a retail store and got it. When he asked about his wages, his employer said, “Pay you! You don’t expect me to pay you, do you? Why, you should pay me, for teaching you the business!” This, as Sowell notes, seems harsh, exploitative: Three months of hard work without pay.

But Sowell asks “Who benefited most?”

The answer is the young Mr. Frank Winfield Woolworth, who went on to found a retail empire, eventually hiring his old boss, the same man who wouldn’t pay him. But the old man sure did teach Woolworth the business.

Unfortunately, such relationships are illegal. “Convinced that many unpaid internships violate minimum wage laws,” the New York Times relates, “officials in Oregon, California and other states have begun investigations and fined employers.” The regulators’ campaign against internship programs is now going nationwide.

Bottom line: No more Woolworths.

Sure, the Woolworth chain died long ago. What’s left of the company is called Foot Locker. But I’m talking about future innovators, future Frank Woolworths.

Which makes this crackdown a prime example of a counter-productive policy.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies porkbarrel politics too much government

How to Simulate Stimulation

Historians have noticed something interesting about the Great Depression: The bulk of Roosevelt’s New Deal money and effort wasn’t directed at the hardest-hit states. It was directed at swing states.

FDR’s New Deal could thus be seen as a vast re-election drive.

Economist Veronique de Rugy, of the Mercatus Center, recently testified before Congress about her studies of recent stimulus spending. She noticed that Democratic districts received bigger bucks than did Republican ones. Coincidence?

Nick Gillespie wrote about this on Reason magazine’s blog, Hit and Run. And, nestled in the comments section, is testimony from someone in the federal government about how stimulus money is actually spent. The government does not look for especially hard-hit areas. It looks for prospect projects that have been designed and engineered and ready to be funded to reach completion quickly.

This is useful to know. If believed, I’ll leave to you the explanation why Democratic Districts might be further along this pork-project train than Republican Districts. But it’s worth noting that this method does not really show any targeted expertise on the part of the federal government. It’s just a spend-and-spend-quickly program. Throw out enough dollars and hope something “sticks” . . . to produce real growth.

You see, this is nothing like how markets for capital projects work in the private sphere. And it’s nothing like a good way of jump-starting a wounded market economy.

It’s just government-mismanagement-as-usual.

This is Common Sense. I’m Paul Jacob.

Categories
First Amendment rights too much government

You Go, Google

A few weeks back I asked what was going on with Google’s pledge to stop helping the Chinese government censor search results for sensitive topics like Falun Gong and Tiananmen Square. Google was presumably using its threat of withdrawal from the Chinese market as a negotiating chip to wrest privileged status from the Chinese authorities.

But the hope was naive. It was unlikely in the extreme that China would give up its program of censoring mainland culture and especially politics. It wants to control the dialogue and thwart political dissent. So I told Google, “Google, ya gotta go. Stop enabling Chinese censorship. Do as you promised and provide a desperately needed and inspiring example of refusing any longer to cooperate with tyranny.”

I feared Google would retreat from its public commitment. But now Google agrees that for the Chinese government, “self-censorship is a non-negotiable legal requirement.” So Google is redirecting Chinese users of its search engine (Google.cn) to its Hong Kong search engine (Google.com.hk), where results are not currently censored because of the “one country, two systems” policy that has been at least roughly followed since China took over Hong Kong in 1997.

Whether citizens on the mainland will be able to get uncensored search results from the Hong Kong Google search engine is an open question at best. But any censorship of those results will now be perpetrated by China without Google’s active cooperation. Good for Google.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies too much government

Sometimes a Great Prediction

Five years ago, I compared Social Security to the Titanic. Insolvency played the part of fatal iceberg. On Monday I noted that the first stage of insolvency —  projected back then to take place in 2017 — has been refigured to arrive early. This year.

So much for our leaders’ plan of “not putting off till tomorrow what can be put off a decade.” Decades sure aren’t what they used to be.

Neither are the budget numbers politicians throw around. Take the Democrats’ just-passed medical reform package. Do you really believe it will save us money?

Who’s right depends on the reliability of the reform package’s cost projections. And, from what I can tell, those projections are filled with trickery.

A typical sleight of hand is to project ten years in advance, and extoll how that decade’s first years don’t add much burden to the taxpayer. But that’s only because chunks of the programs stagger into effect over the first half of the decade.

But before you go poring over the bill’s two thousand and more pages, checking the  numbers, ask yourself: When have government economists correctly predicted costs of a major new entitlement?

Never.

Take Medicare. Initial projections for catastrophic coverage were half of the real amount; Medicare as a whole grew nine times over its promised size; and the costs of Medicare’s Disproportionate Share Hospital Adjustment program proved 17 times higher than originally predicted.

Congress is in the business of making bad law, not good prophecy.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies too much government

The $2.5 Trillion Tip of the Iceberg

This year, Social Security goes into the red, unable to pay out all that’s been promised . . . without somehow finding new funds. Five years ago, the estimated date for this was 2017. An economic downturn later and seven years disappear. Just like that.

It’s obviously time for a major overhaul. But Congress and the President had other priorities. Don’t fix the old entitlement program — add a new one to bankrupt the country, “health care reform.”

What to do? Well, Associated Press’s Stephen Ohlemacher writes that it is time to cash in the IOUs that Congress owes the Social Security Administration. Congress has been siphoning off the system’s revenue surplus since the ’80s.

Congress, that august body of spendthrifts and thieves, actually accounted for these funds by printing up non-negotiable bonds, rather than leaving them as electronic IOUs. They are stored in a folder in Parkersburg, West Virginia.

Fat lot of good that does us, though. To pay the bonds, Congress would have to raise taxes or borrow even more money.

Or it could auction off some property. Selling vast tracts of BLM land might make sense, but you won’t see that brought up. Instead, Congress will be sorely tempted to debase our money further.

Congress’s IOUs to Social Security add up, to $2.5 trillion. Of course, the money promised Americans in basic retirement is far more than that. The two-and-a-half trillion is just the tip of a very large iceberg . . . heading this way.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets national politics & policies too much government

In Case You Were Worried

It’s magic. Not only does the recently passed health care reform cover more people, it cuts deficits too.

Ha! You know it, I know, we all know it: Major government entitlement programs always end up costing far, far more than their original advocates claim.

Or should we just trust trust the reform’s advocates no matter what past experience and rational accounting say?

Democratic Congressman Jim Clyburn turned to MSNBC to explain all about how Obamacare would slash the deficit. “We’re extending the life of Medicare by nine years, and if you’re taking the waste, fraud and abuse out of this, the savings that you get there will come as things grow. Savings will grow.”

Ah, waste! Fraud! Abuse! Politicians love such talk, at least until the waste and fraud gets renamed “stimulus spending.”

Then Clyburn said: “You look at the community health centers. Savings will grow more in out years than in the first few years. So I believe — well, that’s my assessment, and that’s the way I’m explaining it to members. I hope I’m right.”

So there is hope.

Also, 32 million people will be coming into insurance plans and out of emergency rooms. (Unless there’s an emergency.) Also, Clyburn’s wife had bypass surgery and the bill included $15 for an aspirin. What we must understand is that the new command-and-control regime will “build savings into the system.”

Could what this third-ranking House Democrat really be trying to say is that he has no idea what he’s talking about?

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies Tenth Amendment federalism too much government

Idaho’s Healthy “No”

By hook and by crook — ignoring the constitution and twisting parliamentary rules — the president and his congressional allies are succeeding in imposing command-and-control health care on all Americans.

If the new law is allowed to stand, the scraps of freedom we still enjoy in matters of health care will dwindle as provisions of the bill kick in. And that’s only the prequel. Pelosi and other Democrats promise to introduce even more constrictive legislation once Obamacare Round One has been rammed through.

Friends of freedom aren’t giving up. There’s an election in 2010, for one thing. But many state governments aren’t waiting for that. The Idaho legislature just passed the Idaho Health Care Freedom Act, which states, in part, that “every person within the state of Idaho is and shall be free to choose or decline to choose any mode of securing health care services without penalty or threat of penalty.” Governor Otter is signing the Act because, in his view, health care laws should treat people as individuals “rather than as an amorphous mass whose only purpose in this world is to obey federal mandates.”

Idaho is the first state to pass such a measure, but similar legislation has been proposed in 22 others. Such declarations will most likely have only symbolic significance if Obamacare remains in effect and other legal challenges on the grounds of federalism get beaten down. But those are two big ifs. Americans aren’t ready to surrender to the health care commissars just yet.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets too much government

Keystone Cops in Philly Folly

This March, armed Pennsylvania State Police bravely raided three popular bars in Philadelphia.

They confiscated liquors that allegedly had not been properly registered with the state Liquor Control Board. Brewers and importers must pay a $75 registration for each separate potable they sell in the state.

Some unnamed concerned citizen had complained. The three bars were affiliated, so maybe a resentful competitor had something to do with it.

According to the owners, many of the confiscated ales had been duly registered. But when the state police couldn’t instantly confirm this, they just grabbed cases and kegs and towed them away.

Even in the case of unlicensed ales, what is the virtue of raiding a bar to sloppily “check” their status and then steal supplies? Especially when it’s not the bar owners who are legally obligated to register the brands?

Some clerk could have just dropped by, inspected the booze, asked a few questions. Or just called the brewery and said, “Hey, you forgot to register such-and-such.”

Of course, the whole idea of requiring separate registrations of each separate beverage is silly to begin with.

Further, the state police could have, and should have, simply declined this wrongheaded mission.

Apparently we can’t count on better lawmaking and better, more sensible regulations. But we do count on our police.

This is Common Sense. (Let’s practice it.) I’m Paul Jacob.

Categories
Accountability free trade & free markets too much government

Krugman’s Crazy Crotchets

Paul Krugman is getting sillier and sillier these days. He’s supposed to be an economist, and not long ago some people in Sweden gave him an award for his economic work. So why would he suggest that economic incentives just don’t matter?

The New York Times columnist bashed Republican Senator Jon Kyl for stating that generous unemployment benefits can reduce the incentive to look for new work. Krugman says that this isn’t the textbook view of things shared by himself and the Democrats. “What Democrats believe,” Krugman says, “is what textbook economics says.”

Gee. So what does textbook economics say?

James Taranto of the Wall Street Journal actually checked a textbook in economics. According to this textbook, “Public policy designed to help workers who lose their jobs can lead to structural unemployment as an unintended side effect. . . . In other countries, particularly in Europe, benefits are more generous and last longer. The drawback to this generosity is that it reduces a worker’s incentive to quickly find a new job.”

Interesting. So who wrote this textbook? Yes, that’s right: Paul Krugman.

This partisan fellow, Krugman, often seems to go out of his way to be contradictory as possible. Does he believe his own babbling? Or is he just trying to get a rise out of us?

Or is it to please his editors over at the Times?

Call it an economic incentive.

This is Common Sense. I’m Paul Jacob.

Categories
government transparency national politics & policies too much government

How to Find Out What’s In the Health Care Bill

When I heard what Nancy Pelosi said about the health care bill the other day, I did a double-take. And had to double-check the press release issued by Pelosi’s own office.

Yikes! She really said it! Then published it on her website to the accompaniment of bugles and trumpets!

Okay, maybe I invented the bugles and trumpets. But not the words:

“Prevention, prevention, prevention — it’s about diet, not diabetes. It’s going to be very, very exciting. But we have to pass the bill so that you can find out what is in it, away from the fog of the controversy.”

Ah yes, the “fog of the controversy”! The way critics of this 2000-page legislation have exposed the regimentation, price controls, new taxes, and choked-off choices we’ll all suffer if the bill passes. How dare we!

Terrible that there’s actually debate about whether we should permanently lose more of our freedoms. Can’t we all agree to be trampled and then find out what it all means? After it’s too late to stop it?

No. Let’s dispel the fog right now. Let the government mail a copy of the bill to every voter.

And let Congress agree that every voter must pass a 500-question multiple choice quiz on its contents before Congress moves forward.

Let’s dispel the fog before we’re saddled with this thing.

This is Common Sense. I’m Paul Jacob.