Category: free trade & free markets

Auto Destruct

car, automobile, auto, loan, bubble, illustration

Just when you thought it safe to go back into the loan market. . . .

Yes, you guessed it: a bubble may be about to pop.

There are actually several, but here’s one you might not expect: the automobile loan market.

Though less regulated and tampered with than the housing market, auto loans aren’t immune to “moral hazard” and other government-induced dangers. The Fed’s low interest rates are almost certainly stimulating the new car market. “Subprime” car loans are way up and so are delinquencies. Do the bankers making these decreasingly solvent loans expect a bailout?

As Eric Peters notes at his immensely fascinating automobile website, the average car loan is now $32,000, “a record high.” And then there’s the “ever-increasing duration of new cars loans. They are now on average six years long — and seven year loans are becoming pretty common.”

Why? “In order to spread out payments (now averaging almost $500 a month) that have become simply too much to manage for most people.”

But then of course car prices are rising. And not just because of simple inflation. It’s the result of government regulations, mandates, and . . . general craziness. Many buyers now finance used car purchases, too, as Mr. Peters explains. That used to be fairly uncommon. The used-car market has been unduly affected by government insanity as well. Remember Cash for Clunkers? Politicians boasted about their managed destruction of millions of used autos.

What they really achieved was a tighter-than-ever supply of usable older cars.

Cruising toward the auto-destruct of the auto-loan markets.

This is Common Sense. I’m Paul Jacob.

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Tags bubble, housing bubble, loans, moral hazard

Accountability free trade & free markets general freedom government transparency moral hazard national politics & policies

Banking on Clinton

Hillary Clinton, Wall Street, Bernie Sanders, corruption, crony, presidential race, two-faced, 2 faced, illustration, Common Sense

I’ve been tough on Bernie Sanders, the socialist Vermont Senator and Democratic Party presidential candidate. Why? Because socialism is — to quote a current GOP candidate — “a disaster.”

But I appreciate his campaign for showing former Secretary of State Hillary Clinton for what she is, the ultimate establishment insider.

Even while, as SNL parodied, she seeks to co-opt Sanders’s progressivism.

Nowhere is Hillary’s have-it-both-ways mode of operation more obvious than in regard to Big Finance. She attacks the big banks, promoting her “very aggressive plan to rein in Wall Street.” Yet, she is supported politically and has been enriched personally by Wall Street firms. In 2014 and 2015 alone, Mrs. Clinton was paid $11 million dollars for speeches to various groups, including these financial interests.

On the campaign trail, Bernie has been calling on Mrs. Clinton to release transcripts of her speeches to Wall Street firms:

She gets paid $225,000 for a speech. Now you know that is a lot of money for an hour speech. . . . It must be mind-blowing speech, it must be a Shakespearean speech, it must be a speech that could educate and enlighten the entire world.

An anonymous attendee of Mrs. Clinton’s speeches to Goldman Sachs has characterized her remarks as “far from what she sounds like as a candidate now. She sounded more like a Goldman Sachs managing director.” Another said making the transcript public “would bury her against Sanders.”

Understandably, Hillary refuses . . . until every other living person who has ever spoken a word to anyone on Wall Street does so first.

At his rallies, Bernie now throws his empty hands up into the air to release his non-existent speech transcripts.

This is Common Sense. I’m Paul Jacob.

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Tags 2016 Presidential race, banks, Bernie Sanders, Hillary Clinton, Presidential campaign 2016, Wall Street

free trade & free markets general freedom ideological culture moral hazard nannyism national politics & policies too much government

Socialist Stasis, Disturbed

Post author By CS Admin
Post date March 21, 2016
3 Comments on Socialist Stasis, Disturbed

Cuba, stasis, Obama, visit, illustration

As the President of the United States treads ground previously trod by such a personage nearly ninety years ago — Calvin Coolidge was the last U. S. Commander in Chief to make the trip to Cuba — we are understandably inundated with coverage.

Obama’s Cuba trip is Big News.

We see that Cuba is backwards — it is socialist, after all, so no surprise there — but slowly opening up to American travel and trade. The nation’s voluntary sector squirms under the omnipresent, oppressive feet of its regulators.

What we see now is the result of socialist repression. Cuba shows, perhaps, socialism’s best-case-scenario result, stasis. The island dystopia is in many ways a time capsule. Some of its current charm is that stuck-in-timed-ness.

But there is also endemic hopelessness in the country. The people are held back. Infantilized. Ruled.

And there is no disputing the fact that this is all the result of an excess of socialism. As I have argued before, the old standby, the Blame the US Embargo ploy, is one that socialists wield with devastating results — to their own ideology. Socialism is the suppression of free trade; pure socialism abolishes all trade, along with all private property. Blaming an embargo shows how important private property and capitalism itself are to socialism’s few successes.

Barack Obama is, right now, demonstrating the best case against socialists in his own party, by opening up Cuba to the wonderfully corrosive processes of the market.

This is Common Sense. I’m Paul Jacob.

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Tags Cuba, freedom, Havana, Obama, socialism

Accountability crime and punishment free trade & free markets general freedom moral hazard nannyism national politics & policies

The Peace Dividend

legalization, pot, marijuana, crime, drug war, illustration

Has the War on Drugs actually, finally, made some progress?

Well, yes . . . but, really, no.

“Legal marijuana may be doing at least one thing that a decades-long drug war couldn’t,” explains Christopher Ingraham in The Washington Post’s Wonkblog, “taking a bite out of Mexican drug cartels’ profits.”

Certainly “legal marijuana” is not the drug war. It’s that war’s antithesis.

Let’s recall, too, that legalization didn’t come about after five decades of drug war failure because politicians came to their senses, admitted their mistakes and advocated a different approach.

Instead, frustrated citizen leaders teamed up with successful entrepreneurs to launch ballot initiatives, allowing voters to directly decide the issue.

Domestic production isn’t driven merely by Colorado, Oregon, Washington State and the other Washington, the nation’s capital, where voters fully legalized possession. Marijuana for medical use is legal in 23 states, including California, where most domestic marijuana is grown. In these states, pot is widely prescribed.

Thus, a quasi-legal domestic marijuana industry was created. Lo and behold, now pot produced in the good old USA is outperforming pot grown south of the border.

The Drug Enforcement Agency (DEA) acknowledges that U.S. marijuana is being illegally smuggled into Mexico. (Maybe the smugglers will pay for the wall.)

On the other hand, what does it matter that the Mexican drug cartels are losing market share to non-violent American businesses?

Well, those cartels have waged a war with the Mexican government killing more than 164,000 citizens between 2007 and 2014. Less profit to fuel the Mexican drug lords in that bloody war is more for our peace and security.

This is Common Sense. I’m Paul Jacob.

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Tags cartel, crime, Drug War, legalization, marijuana legalization, Mexico

crime and punishment folly free trade & free markets general freedom ideological culture nannyism too much government

Potluck Rites, and Rights

potluck, food, inspection, safety, regulations, government, folly, Common Sense, illustration

Progressives are becoming increasingly defensive about nearly all forms of Big Government, relentlessly telling us that we need government for everything from money and roads to food inspection and subsidies and . . . well, the list is endless.

Food safety is one of their favorite subjects, but I’m increasingly skeptical. Do we really need to be protected from our neighbors’ produce and cooked goods, as can be found in community bake sales and potlucks?

In Arizona, legislators had long carved out an exemption from commercial food safety regulations for potluck and similar “noncommercial social events.” Great. But there was an unfortunate limitation to the exemption: it applied only to such events that took place at a workplace.

Home or church? Potlucks there are still against the law.

So of course officials took the occasion of said “loophole” to crack down on some neighborly events in an Apache Junction mobile home park, in Pinal County.

I’m sure hundreds, perhaps thousands of these events are routinely ignored by Arizona’s police. Indeed, I bet half of the state’s better cops engage in such activities themselves — just because potlucks are part of everyday life all over the country.

But the idiotic regulation allowed public servants (loosely so called) discretionary powers to attack a few people for reasons tangential to community safety. Thankfully, Rep. Kelly Townsend has introduced HB 2341, which would extend potluck freedom beyond the office or warehouse workplace.

Let us be clear: this was not a problem waiting to be solved by Big Government. It is a Big Government problem to be solved by new legislation to de-regulate home and community potlucks.

This is Common Sense. I’m Paul Jacob.

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Tags big government, food, regulation, regulations

folly free trade & free markets ideological culture meme moral hazard nannyism national politics & policies too much government

What Kind of a Socialist is Bernie?

Post author By CS Admin
Post date February 7, 2016
No Comments on What Kind of a Socialist is Bernie?

Bernie Sanders, monopoly, control, redistribution, central. planning, government, meme, illustration

He’s never met a government monopoly he didn’t love, or a free market service he didn’t distrust or despise…

…but don’t worry, he’s not really a socialist!

Click below for a high resolution version of this image:

Tags Bernie Sanders, meme, socialism, socialist

Accountability folly free trade & free markets moral hazard porkbarrel politics too much government

Crony Corn

pig, port, corn, ethanol, subsidies, gas, fuel, Common Sense, Paul Jacob

The presidential campaign officially begins in Iowa. The Hawkeye State is also the nation’s corn-growing champion. Each year, Iowans sell 47 percent of that crop to produce ethanol, which accounts for a not-insignificant 8 percent of the state’s gross product.

Ethanol has friends in Washington, too. Congressional wizards have mandated that the gasoline pumped into cars throughout the land be diluted with ethanol — talk about a market guarantee!

At National Review, Jeremy Carl explains that “energy-policy experts of all political stripes can agree . . . mandates and subsidies to promote the use of corn ethanol (a policy first implemented by Jimmy Carter) are wasteful boondoggles that harm our environment and food supply while imposing billions of dollars of hidden costs on consumers. However, most energy-policy experts are not running for president in the Iowa caucuses.”

In 2008, both Sen. Hillary Clinton and Sen. John McCain flip-flopped to support the ethanol subsidies they had previously opposed.

But, this year, Sen. Ted Cruz and Sen. Rand Paul haven’t pandered along.

When Cruz rose to first place in the polls, Gov. Terry Branstad attacked, arguing, “It would be a big mistake for Iowa to support [Cruz]” because “his anti-renewable fuel stand . . . will cost us jobs, and will further reduce farm income . . .”

Yesterday, Fox News Sunday host Chris Wallace asked Cruz, “Why should [Iowa] voters side with you over the six-term governor of this state?”

“I think there should be no mandates and no subsidies whatsoever,” Cruz replied.

In today’s Iowa caucus, can Cruz overcome the forces of crony corn?

This is Common Sense. I’m Paul Jacob.

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Tags 2016 Presidential race, corn, ethanol, porkbarrel, porkbarrel politics, Presidential campaign 2016, subsidies

Accountability free trade & free markets government transparency ideological culture media and media people nannyism national politics & policies responsibility

A Diminishing Lagtime

Flint, water, crisis, government, austerity

The modern age sports an amazing feature that used to be hard to detect, because so drawn out: a shorter-than-ever-before lag between the proposal of some popular inanity and its complete debunking.

It used to take seemingly forever for a bad idea to be shown up, either in argument or evidence. Now it can be a matter of days or even hours. Call it the Buncombe/Debunking Lagtime.

Take the Flint, Michigan, water fiasco.

When the story hit the news cycle, almost immediately the progressive meme machinery began cranking out slogans imposed upon visuals — jpegs and gifs — to the effect that the poisoned water was the result of Republican “austerity” or (even) “libertarian” policy.

Somehow a Democratic mayor was less to blame than a more distant Republican governor, but in the minds of knee-jerk partisans, common sense is not as important as an in-your-face accusation.

But now, days and scant weeks into the story, it turns out that the story behind the story is not merely wrong, but entirely, upside-down wrong. The Flint water fiasco was caused by a stimulus project, and the switch from bad to worse water sources was made to promote “jobs”!

In the words of Reason’s Shikha Dalmia, “the Flint water crisis is the result of a Keynesian stimulus project gone wrong.”

Yes, another failed Big Government policy — just like progressives are always pushing.

And it didn’t take years for the truth to seep out.

Hooray for today’s accelerated history! Now, if we could only decrease the lagtime between lesson given and lesson learned.

This is Common Sense. I’m Paul Jacob.

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