Category: free trade & free markets

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free trade & free markets too much government

Knot Cannibalism!

Midas, in honor of his peasant-turned-king father, King Gordias, dedicated an ox-cart to the gods, tying it with a knot so complex no one could undo it. It was there years later when Alexander of Macedon stopped by, and turned his hand to untying it. He couldn’t. So he took his sword and cut it open.

Some seemingly insoluble problems are best solved by stepping back and “cutting the Gordian knot.”

Take a current knot, fictional cannibalism. The auteur responsible for the gore-fest The Offspring recently sought funding for another cannibalism horror film, to be entitled The Woman.

The funder turned him down. “This film is unlikely to promote tourism in Michigan or to present or reflect Michigan in a positive light,” said the head honcho of the funding institution, the state’s film commission.

Two years ago, that tax-funded organization produced 26 separate efforts. “Isn’t that just amazing?” Commissioner Janet Lockwood gurgled.

But her turning down funding for a horror film, for reasons of content, have let loose a storm of criticism. Some say that when government says “no” to an artistic product on content grounds, that’s censorship.

They are right.

Others say they don’t want their tax dollars going to vile, disgusting depictions of cannibalism and other vices and crimes.

And they are right, too.

The solution? Cut the knot of this problem in one swipe: Governments shouldn’t fund films. End of story. [Roll credits.]

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets general freedom too much government

Prophet of Loss

What if Karl Marx was . . .  half right?

Marx’s theory of history elaborated that, with each bust of the boom-and-bust cycle, the rich would nab ever more property — capital — until impoverished workers united to take all that capital for “themselves” (as a collective) and run it for the common good.

That’s dialectical materialism. It didn’t predict what happened even in Communist countries. But something vaguely Marxian is going on now.

Today, when there’s a bust, government bails out the failed rich guys — even buying companies.

Further, governments keep hiring more people to “stimulate” the economy. Government workers increase as a percentage of the workforce, with higher-than-average wages and benefits.

This used to be called “creeping socialism.” Politicians move us closer to total government — measure by measure, tax by tax, law by law. No revolution necessary.

Except . . . well, as politicians put more of our eggs into the collectivist basket, each down-swoop of the business cycle makes the whole system less stable — and (with increasing taxes and debt) more burdensome to sustain.

It could all lead to revolt — a taxpayer revolt.

Taxpayers, who’ve had to put up with a lot of nonsense over the years, aren’t even a tad bit interested in the foolishness of communism — or a corporate, fascist super-state.

That’s where Marx and his followers had it all wrong. Only the build-up of instability seems Marxian. Americans’ response is to seek limits on government.

This is Common Sense. I’m Paul Jacob.

Categories
folly free trade & free markets

Finding Common Sense in China?

Las Vegas gambling entrepreneur Steve Wynn says that “common sense” has “disappeared in Washington, DC.” In a recent interview on CNBC, he complained about the federal government’s “wild, uncontrolled spending” and “unbelievable, unsustainable debt.”

Good point, of course, but nothing new. Still, Wynn’s rant went further.

Wynn is opening a new headquarters for his casino empire in Macau, China, and was asked if he expected to find “common sense in Macau.” He didn’t mince words, arguing that the “opportunities” were “far superior abroad than in America.”

But what about the regulation and government oversight in Macau, China, versus the U.S.?

“Macau has been steady,” he replied. “The shocking, unexpected government is the one in Washington. That’s where we get surprises everyday. That’s where taxes are changed every five minutes. That’s where you don’t know what to expect tomorrow. To compare political stability and predictability in China to Washington is like comparing Mount Everest to an ant hill.

“Macau and China is stable. Washington is not. Is there a businessman or a media person in America . . . that isn’t frightened about what the next crazy idea is coming from Washington? . . . Everything is cuckoo and God knows what’s next.”

Wynn closed by saying, “The uncertainty of the business climate in America is frightening, frightening to everybody. . . . there’s a sense of fear that the politicians are ruining us . . .  It’s got to stop.”

Amen.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets government transparency

Ignorance Is Strength (for Boodle Mongers)

Journalist Mark Tapscott helps spread the word about the boondoggles perpetrated by the Department of Agriculture. But his work is being thwarted by the Super Friends of Government Transparency, the Democratic Congress.

The Ag Department manages Congress’s wretched, anti-productive policy of paying farmers to grow fewer crops. It also applies these New-Deal-era policies in the silliest manner possible — for example, by giving former basketball star Scottie Pippen $130,000 over five years not to grow crops.

Other Dust-Bowl-afflicted tillers of the field rescued with taxpayer-funded largesse include Sam Donaldson, Ted Turner, Larry Flynt and Ben Bradlee. The ridiculous payouts were exposed thanks to the efforts of a nonprofit outfit called Environmental Working Group (EWG), which posted an Agriculture Department database on its website. It obtained the data from reluctant officials by dint of the Freedom of Information Act.

Back in 2002, Tapscott reported that then-Senate Majority Leader Tom Daschle had tried but failed to exempt such embarrassing spending details from freedom-of-information laws. Because he failed, the EWG could keep updating its database. But in 2008, the Democrats finally let the Department of Agriculture off the hook. Complying with information requests about its crazy subsidies is now “optional.”

So Aggie officials don’t bother.

Tapscott presses the obvious point: Wasn’t the new Democratic majority slated to embody the “most honest and transparent” Congress ever?

Perhaps their new slogan will be Ignorance is Strength?

This is Common Sense. I’m Paul Jacob.

Categories
folly free trade & free markets

Hedging Our Bets

Do congressmen know anything about anything?

Perhaps that’s an unfair question. These guys demonstrate a whole heckuva lot of savvy when it comes to logrolling, porkbarrelling, taxing, spending. Oh, and sniping, grandstanding and griping, and of failing to read bills they pass. I apologize if I implied any deficiency of proficiency in such areas.

I just wonder whether they know anything about real life outside the ways and byways of Capitol Hill.

For example, on the question of whether altering investment strategy in response to changing economic news constitutes “fraud.” If risk management equals fraud, lots of firms should close down tomorrow to protect themselves from congressional subcommittees eager to pretend that government policies have played no major part in screwing up the economy.

Power Line blogger John Hinderaker, after wading through transcripts of the senatorial interrogation of officers from Goldman Sachs, concludes that the senators, “seemingly without exception, are embarrassingly ignorant of modern risk management techniques. . . . [of] how and why firms like Goldman Sachs hedge their exposure to various economic trends . . . [They seem] to think that there was something ‘evil’ about taking a short position — that all investors were somehow required to try to keep the housing bubble going.”

Hinderaker’s observations are more detailed than I can recapitulate here. But the bottom line — that those who would run our lives don’t understand the bottom lines of those who actually work and trade for a living — is nothing new.

This is Common Sense. I’m Paul Jacob.

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

The Chamber, Loaded Against the Free Market

You are familiar with the notion that businesses support the free market, while concerned citizens demand some sort of “regulatory oversight” by government.

It’s a canard.

Oh, some businessmen do indeed support free markets and decry subsidies — and lots of businesses oppose this regulation or that — but, on the whole, the major support for a regulatory regime, or for subsidies and tariffs, for almost any scheme of government control of business, is usually business itself.

Like individuals, businesses too often turn to government for special advantages — over other businesses, or over taxpayers.

That’s why the United States Chamber of Commerce gave Congressman Ron Paul such low marks. You could hardly find a more pro-free-market gentleman in Washington. But, as Timothy Carney notes in the Washington Examiner, 90 percent of Democrats got higher marks on the Chamber’s 2009 congressional scorecard than did Paul, who also got the lowest marks of any Republican.

Why?

Rep. Paul opposed the recent stimulus bill. And he opposed subsidizing the tourism industry as well as solar energy.

The Chamber is a typical business lobbying outfit, favoring an inefficient, mixed economy because some of its leading members hope to milk the taxpayers.

If you are a member of the Chamber but support the fair play of the free market, not the rigged play of government-business “partnerships,” you might want to speak up against your Chamber’s policies.

Or join another group.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets national politics & policies

The Right Stuff Needs No Subsidy

When the president, in a rare fit of fiscal sanity, proposed cutting back on NASA, the subsidized sector of the high tech industry — the military-industrial complex — felt a shiver.

The first, I hope, of many.

NASA has long had a special, high-toned place in that hierarchy of government-funded industries. It’s the civilian wing of the military’s industrial juggernaut. As if to prove that government can accomplish things, NASA actually landed men on the moon. And it kept an ungainly shuttle program going long after its rightful expiration date.

But it’s time for private enterprise to take over in the space industry.

High time.

Still, questions remain — at least in the public mind. As a fascinating MSNBC article put it, “Can private companies build and operate space vehicles safe enough to carry astronauts?” The article’s author, James Oberg, focuses on the emerging market of space taxis, but does ponder the possibility of putting real astronauts out in space, privately. He consulted skeptical NASA engineers, who wondered how unsubsidized, for-profit businesses could mimic NASA’s record.

Where’s their collective experience?

Answer: Let most of NASA go, and that experience would be up for hire.

Our hopes for the future conquest of space depend, in part, on ceasing to subsidize it. Congress and the president should embrace that future, and realize that it is time to relinquish their control over another whole industry.

This is Common Sense. I’m Paul Jacob.

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

Don’t Kill The Angels

President Obama is blasting what he calls “the furious efforts of industry lobbyists” to fend off tighter regulation of the financial industry.

Pretending that Fed credit expansion and governmental incentives to take on temporarily cheap mortgages had no part in the current crisis, officials carefully direct our attention elsewhere. Widespread moral hazard stemming from bailouts, both guaranteed and implied? Shhhh.

But the government, uninterested in regulating itself and its own excesses, is instead targeting you and me.

“Tighter regulation” means less freedom to make your own decisions about your own time and resources.

Venture Beat magazine reports on a provision of Senator Chris Dodd’s proposed reform that would make it much harder for so-called “angel” investors to fund new start-ups.

An angel investor is somebody willing to fund a new business with his own wealth, even when venture capitalists managing others people’s funds decline to invest. Dodd’s bill would force start-ups raising funds to register with the SEC and wait 120 days for the filing to be processed. It would also increase the minimum capital that “accredited investors” must have in the bank before the government will permit them to invest.

Based on nobody’s considered judgment about a particular venture but only on lawmakers’ nebulous fear of entrepreneurial risk, the proposed law would kill in the crib many pioneering and timely, must-act-now innovations.

Accidentally, I’m sure, current businesses would be spared competition from upstarts.

And this is supposed to help the economy?

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets too much government

Carrying On About Carry-Ons

Poor Chuck Schumer. A vendor now charges for a service that it didn’t previously charge separately. So the senator wants to outlaw this.

“Airline passengers have always had the right to bring a carry-on bag” without separate fees, Schumer fumes. It’s a “slap in the face to travelers” that some airlines now consider charging for carry-on bags, a policy already in place at Spirit Airlines.

Horrors! The ugly spectacle of businessmen acting as if they . . . have the right to run their businesses freely, not merely as lackeys of congressional overseers.

Spirit, which is simultaneously reducing base ticket prices, says airplanes will empty faster if there’s less luggage looming overhead. I don’t like paying the fees, but airlines do have costs. And competition. An airline that kept heaping up fees until it was charging $1,800 per ticket wouldn’t get off the ground. Not if another airline was charging far less for the same journey.

The proper response to terms of trade that one dislikes is to complain to the vendor, take one’s business elsewhere, or both — not to decry any scrap of autonomy as a “loophole” in a regulatory regime not yet exhaustively draconian.

Yes, let airlines charge for carry-ons. And let Schumer take the bus to and from DC. This will give him less time to pursue phony-baloney crusades.

This is Common Sense. I’m Paul Jacob.

Categories
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.