Category: moral hazard

Big-Dollar Impact

campaign finance reform, contributions, Hillary Clinton, Bernie Sanders, corruption

Last Saturday, The Washington Post’s top-of-the-front-page headline blared, “50 donors with outside impact.”

If that doesn’t curdle your blood, readers were further warned of a new “Gilded Age.” Yes, in concentrated fundraising the Post heard “echoes of the end of the 19th century, when wealthy interests spent millions to help put former Ohio governor William McKinley in the White House.”

McKinley. The horror. The echoes.

Hopefully, self-immolations can be kept to a bare minimum as Americans discover the report’s main (only) thrust: 41 percent of $607 million contributed to 2,300 super PACs this election cycle has come from just 50 donors … at least, if you also aggregate gifts from the relatives of these 50 folks and their business interests as well.

Isn’t that terrifying? Destructive of democracy? Are our elections simply being bought by the billionaires?

No. No. And no.

Any common sense analysis of this year’s presidential contests, both Republican and Democrat, must acknowledge that big money did not trump. Pun intended. Sen. Bernie Sanders is now outraising Hillary Clinton with millions of small donations — not “millionaires and billionaires.” Jeb Bush’s massive financial warchest made no discernible difference. Even the Post concedes “the mixed impact that big-money groups have had on the presidential contest so far.”

Mixed? Name a single state where “big spending” determined the outcome.

Ideas matter. And securing the resources to advance and advertise ideas obviously matters, too. Same goes for candidates — and their ideas.

More money, more campaign spending, means more ideas and candidacies can reach the political marketplace. That’s where voters, not big donors, do the deciding.

This is Common Sense. I’m Paul Jacob.

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Tags 2016 Presidential race, campaign finance reform, democracy, Presidential campaign 2016, SuperPACs

Accountability folly government transparency ideological culture moral hazard national politics & policies

Money Means Nothing to Her

Post author By CS Admin
Post date April 18, 2016
2 Comments on Money Means Nothing to Her

Hillary Clinton, Bernie Sanders, campaign finance reform, big money, illustration, angel, Saint Hillary

Campaign finance reform is surely dead … if Hillary Clinton is elected president.

Which would be good.

Not Clinton being elected, mind you. What would be good is the death of so-called campaign finance reform — the kind supported by Democrats, including Sen. Bernie Sanders and Hillary Clinton. They insist on a constitutional amendment to partially repeal the First Amendment’s freedom of speech protection and give Congress awesome new powers to regulate their own and their opponents’ campaigns.

But wait — if Mrs. Clinton supports campaign finance reform, why would her election kill this seriously bad proposal?

Well, Hillary Clinton made it abundantly clear at last week’s Democratic presidential debate, as I explained this weekend at Townhall: large campaign contributions do not influence her in any way. Even a fat $15 million from Wall Street interests to her super PAC — or $225,000 a pop speeches paid by Goldman Sachs and their ilk — registers no corrupting effect whatsoever.

And those millions deposited in Clinton Foundation accounts from foreign governments?

They couldn’t possibly sway the steady former Secretary of State. Not even the smallest smidgen.

Just like there has never been corruption at the IRS.

Don’t believe Hillary? Then trust President Obama, who also gobbled up major Wall Street funding when he ran in 2008 and 2012. But again, according to her, “President Obama was not at all influenced when he made the decision to pass and sign Dodd-Frank, the toughest regulations on Wall Street in many a year.”

Not. At. All.

So the solution to government corruption is simply to elect trustworthy, incorruptible candidates … like Hillary Clinton.

Well, call her half right.

This is Common Sense. I’m Paul Jacob.

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Tags 2016 Presidential race, Bernie Sanders, campaign finance reform, Hillary Clinton, Presidential campaign 2016

folly free trade & free markets ideological culture moral hazard national politics & policies

Cranks for President

Donald Trump, Bernie Sanders, cranks, nuts, populists, illustration

Some of us who think of ourselves as populists — or just ordinary people, hence “outsiders” — are having a hard time this political season. The two most talked-about outsider candidates, billionaire Donald Trump and socialist Bernie Sanders, make for strange populists.

A billionaire as a “man of the people”? Not very plausible. It is his lack of a self-censor, his free-wheeling, stream-of-conscious grade-school-level discourse, that impresses many folks. Definitely not scripted.

A socialist as populist? Socialism, long associated with elitists, would put the State into every area of everyday life. Most folks with horse sense resist that.

But Trump and Sanders do have something in common. They rely upon common misconceptions about everyday market life. They both fan the flames of conspiracy theories about prices.

When the price of fuel was spiking a few years ago, Bernie Sanders warned us: “Forget what you may have read about the laws of supply and demand. Oil and gas prices have almost nothing to do with economic fundamentals.” It’s all greed, you see: arbitrary power.

But, as Daniel Bier reminds us at The Freeman, believing that businesses are superpowers out to screw us with ever-rising prices, unhampered by supply and demand, is not just socialist silliness, it’s Billionaire Trump silliness, too — four years ago, the developer not only trumpeted the idea that we simply threaten OPEC for lower prices, but suggested we actually seize foreign oil fields.

This is not common sense. It’s crankism.

It’s the kind of thing folks say when they’re drunk.

Maybe on power.

This is Common Sense. I’m Paul Jacob.

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Tags 2016 Presidential race, Bernie Sanders, cranks, Donald Trump, populism, Presidential campaign 2016

folly free trade & free markets moral hazard nannyism national politics & policies responsibility

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 crime and punishment moral hazard national politics & policies property rights too much government U.S. Constitution

Return to Robbery

civil asset forfeiture, asset, forfeiture, police, abuse, stealing, theft, property, Common Sense

Last week, the crooks in Washington proved themselves nice enough to let us know that their rip-off machine is back in action. The Obama Justice Department announced the resumption of the “equitable sharing” program, whereby the Feds sing Kumbaya with state and local police while sharing the loot they snatch from innocent folks through “civil asset forfeiture.”

Yes, there again is that strange three-word, legalistic, police-pocketing term: civil asset forfeiture.

Free country? Not so long as local police and federal government agencies seize people’s stuff without ever charging or convicting those people of a crime. Simply by claiming suspicion … about their stuff.

To get their money or property back, the victims must hire an attorney and sue the government. Guilty until proven innocent. Only those raking in the ill-gotten gains are shameless enough to defend this completely un-American practice.

Which more than doubled in use during President Obama’s first five years in office, according to The Washington Post. Today, police and various government agents actually take more value from innocent Americans through civil asset forfeiture than do burglars through burglary.

“As President Obama counts down the days of his last year in office,” the Cato Institute’s Adam Bates wrote back in January, “one positive step he could take for his legacy would be to halt the federal government’s use of civil asset forfeiture and make the suspension of the equitable sharing program permanent.”

Yet, despite Mr. Obama’s talk about criminal justice reform, and despite his ability to bring justice with a stroke of his pen (and actually within his constitutional authority), last week the Feds instead went back to business as usual, ripping people off.

This is Common Sense. I’m Paul Jacob.

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Tags asset forfeiture, civil asset forfeiture, corruption, crime, law, police

folly ideological culture moral hazard national politics & policies tax policy

Rebranding the Odious?

tax, taxes, charity, IRS, I.R.S., Alain de Botton, branding, rebranding, illustration, folly, Common Sense

Being a clever person is hard work. Many of the truly clever things about everyday life have already been said. New and innovative cleverness? A rare thing indeed.

But if you are in the business of being clever, that puts you in a pickle, if “being relevant” and “worth our attention” is part of your cachet.

Take Alain de Botton, a very clever man who has written at least one brilliant book … and several not-so-brilliant ones. He has tackled Proust, Epicureanism, and is now deeply into religion.

Well, maybe not so deeply.

He wants politicians to follow the lead of religious leaders, who, he asserts, are masters of rebranding. (I had thought that was for marketing specialists.)

Recognizing that the word “tax” is an odious one — few people really like paying their taxes — de Botton says that politicians should follow what “religions do” and “rebrand ‘tax’ as ‘charity.’”

Charity, he notes, is a “much more appealing word.”

Well, yeah. That’s because charity is a word for love. It is all about deep concern, sympathy, etc., and “acts of charity” are expressions of love and concern.

And the only way that acts of charity can be determined to be expressions of concern is that they are voluntary. Taxes, on the other hand, are not voluntary. They are taken by force (try not paying them — force will find you).

Forcing people to “be charitable” will automatically scuttle that very purpose.

Trying to rescue politics from the stench of compulsion should not be done with rebranding, but by limiting government.

The less government, the less force.

And more scope for charity.

This is Common Sense. I’m Paul Jacob.

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