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

Don’t Bank On It

It’s not a chorus.

If you’ve been watching the “debate” over how best to con American voters into giving troubled banks $700 billion for bad loans, you might think it’s a chorus in the financial industry, especially from bank presidents.

You might assume they’re all shouting: GIVE US THE BAILOUT MONEY! NOW!

Not so. At least one banker dissents. John Allison, president of BB&T — with $136 billion in assets and 1500 branches — sent an open letter to Congress protesting the bad economics behind the bailout. He notes that his own company, though affected by the downturn, is in a much stronger position than many of BB&T’s competitors.

Why? Well, his bank did not join the orgy of bad lending, despite the enticement of the Federal Reserve’s easy credit policies and government pressure to give loans to bad-risk borrowers.

So why should the government reward the bad economic conduct of institutions that played along with the bad government policies? Why make it harder for the economy to recover by punishing sound and productive economic conduct with burdensome new government taxes?

Allison thinks the debate has suffered from domination, as he says, by those “financial institutions [that] made very poor decisions.”

Perhaps it’s because politicians have a whole lot more in common with foolish decision-makers than wise ones. . . .

This is Common Sense. I’m Paul Jacob.

Categories
term limits

A Bloombergian, Buzzing Confusion

A politician has changed his mind about term limits.

Over the years, Mayor Michael Bloomberg of New York City has often expressed firm support for the city’s two-term limit on officials. But lately his comments about term limits have been getting fuzzier.

And now the newspapers report that the mayor openly supports a unilateral revision by the city council to weaken the limits from two terms to three.

The change would have to be unilateral. Bloomberg is a popular mayor, but his own polling shows that most New Yorkers, although they may like him, would dislike any weakening of the term limits law.

New Yorkers passed the two-term limit in 1993. They confirmed their support in 1996. Bloomberg and city councilors will be showing an extraordinary contempt for the voters if they dictatorially trash term limits to cling to power.

The bad news gets worse, alas.

Ronald Lauder, the billionaire who financed the term-limits drive in 1993, now says he supports a third term for Bloomberg, and supports bypassing voters.

Lauder contends that in these trying financial times, it is just too risky to let anyone else man the helm. Funny, though, how the city managed to carry on in the wake of 9/11, letting Mayor Giuliani step down. That was a worse mess.

But then, the mess may be in the eye of the incumbent.

This is Common Sense. I’m Paul Jacob.

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

$700 Billion Bad Bet

The administration’s proposed $700 billion bank bailout has finally passed the Congress — in large part because of fear that the economy would crumble if “something” wasn’t done.

But the magic men in Washington don’t have any guaranteed fixes in their bag of tricks. Certainly robbing the taxpayers of $700 billion — that’s a billion, 700 times — won’t cure the economy.

It will, long run, hurt the economy. How? By hampering realistic adjustment to current market conditions. It means taking $700 billion from productive economic activities to buy up debt at prices nobody in the private market is willing to pay. As economist Arnold Kling points out, “If [Bernanke and Paulson] were taking their plan to a venture capital firm to seek funding, they would be laughed out of the office.”

How did we get here? In previous years, the federal government compelled banks to give mortgages to persons who really couldn’t afford them. Meanwhile, the easy credit policies of the Federal Reserve made it easy for banks to obey these irresponsible demands.

Hence the housing bubble. Which popped.

The only long-term solution is to get the government out of the market. Stop trying to paper over the horrendous consequences of past government interventions with even worse government interventions. The free market ought to be free. Otherwise, we’ll one day end up with no market at all.

This is Common Sense. I’m Paul Jacob.

Categories
Accountability insider corruption

Corrupt Cooking

Can you be kicked out of the government for serving sautéed shad roe?

Prime Minister Samak Sundarave of Thailand has just been ousted by a Thai court for violating the constitution. His crime? Hosting TV cooking shows while in office.

Samak was the host of “Tasting, Grumbling,” and “Touring at 6 a.m.” After becoming premier, he kept doing them for weeks, until finally quitting the shows in response to political outcry.

Samak probably violated Thai law. But I can’t say I’m appalled by the spectacle of someone in the government also holding a legitimate private-sector job. And I don’t think the concept of “appearance of corruption” should be so elastic that it distracts us from recognizing and combating real corruption.

In the U.S., Senator Tom Coburn has been battling the loose and even corrupt spending habits of senatorial colleagues. He has also, as senator, continued working as a doctor delivering babies. Coburn has agreed to collect no pay for his work, but the Senate’s so-called ethics committee wants him to stop. Ridiculous.

I’m no expert on politics in Thailand. Perhaps Samak is verifiably corrupt — for reasons having nothing to do with mixing sauces on television. Opponents have also been gunning for Samak’s cabinet. Perhaps the complaint about his cooking was just a handy way to get rid of him.

But in my book, that’s the wrong way to cook up a scandal.

This is Common Sense. I’m Paul Jacob.

Categories
term limits

Reader’s Remorse

You know what buyer’s remorse is, right? The New York Times doesn’t.

When you purchase something and then realize it wasn’t worth what you paid, that’s buyer’s remorse. The Times stretched the concept to enacting a public policy and then realizing the policy isn’t working.

David Chen and Michael Barbaro’s recent article on term limits led off by informing us that “A decade after communities around the country adopted term limits, at least two dozen city governments are suffering from a case of buyer’s remorse.”

But hold on. City governments [read: city politicians] didn’t bring us term limits. It was the voters, using the initiative process. Because politicians never “bought” the idea, they can’t have buyer’s remorse.

Politicians do complain about term limits. For instance, Tacoma, Washington, Councilwoman Connie Ladenburg fears that if she has to give up her seat a $2 million pedestrian and bike trail she’s been pushing might not be completed.

In Rowlett, Texas, a Dallas suburb, the mayor decries that term limits make it harder to land positions on national organizations like the U.S. Conference of Mayors.

New Yorkers have twice voted for term limits. Still no voter’s remorse. That’s why Mayor Bloomberg and the City Council are scheming to repeal the limits, without a vote of the people.

Many have talked about Bloomberg as a possible independent candidate for president. But it looks like he’ll go down as just another politician.

This is Common Sense. I’m Paul Jacob.

Categories
free trade & free markets

When Do We Become Adults?

What is being an adult all about?

Doesn’t maturity have to do with taking responsibility for your life, for your decisions?

Of course, it is often appropriate to ask for help, to underwrite dreams or salvage the shipwrecks of them when we screw up.

But even when seeking help, you do it like a grown-up rather than, say, a whining child. You ask for the help. Politely. As opposed to assuming that other people just owe it to you, to heck with their own circumstances and priorities.

Yet government now subsidizes every big-ticket project on our every wish list, hurling more money at us when we botch the job. It’s as if they’re paying us to be irresponsible.

No shock, then, when people do in fact act irresponsibly, buying homes or making loans they can’t really afford.

Ford, GM, and Chrysler — the Big Three of American automakers — now ask for a $50 billion low-interest loan from the U.S. government. Why? So they can modernize their plants to make more efficient cars. What, just $50 billion?

What about me? I need to re-shingle my roof.  Please, government, give me a million. Just take it from my neighbors, no problem.

You know, if Chrysler had been allowed to fail back in Iaccoca days, GM and Ford may have learned a lesson — grown up — and wouldn’t think to ask for handouts today. Or need to.

This is Common Sense. I’m Paul Jacob.

Categories
national politics & policies

Must It Be Racism?

One of the two major-party candidates for president is black, the other white.

Obviously, there is much more to say about them. We can talk about their ideas, character, experience, communication skills. Presumably, conscientious voters will choose the person they think can best do the job — regardless of race.

Not so, says Jacob Weisberg of Slate.com. According to Weisberg, given the collapse of the Republicans and the weak economy, everything is stacked in favor of Barack Obama. Therefore, if Obama loses the election, only racism could explain it.

Weisberg offers no coherent argument. He simply asserts that Obama has vastly more advantages than liabilities, while with McCain it’s vice versa. So the right choice is transparently obvious.

And hey, even if you disagree with Obama’s policy prescriptions, at least they’re “serious attempts” to deal with big problems. It doesn’t seem to occur to Weisberg that the “seriousness” of a proposed policy is not what makes it right or wrong. Or that a voter might reasonably consider the actual content of a proposal.

Of course, some voters might reject Obama out of racism. But it’s not self-evident that “racism is the only reason McCain might beat him.”

And would it not be racist, condescending, unjust, and downright stupid for us voters to treat a black man’s qualifications for the job of president as irrelevant, just to prove we’re not racist?

To his credit, Mr. Obama would expect more of us than that.

This is Common Sense. I’m Paul Jacob.

Categories
initiative, referendum, and recall term limits

Fast-Moving Planet

This presidential campaign is about change, but it’s outside of government that change comes fast and furious. Maybe it’s just my advancing age but the world seems to be speeding 90 miles an hour into the future.

Actually, we’re spinning at over 1,000 miles an hour and soaring around the Sun at 67 times that rate. Some days it feels like it.

Yes, there is going to be change. It ought to come from us, not the insiders — or the politicians running to purportedly change Washington, or to change your neck of the woods, often after decades in office.

Most of our changes won’t come through government policies. They’ll happen in the marketplace, or at church, through a non-profit group, or in the neighborhood or family. But some changes do require politics.

Then, “We, the People” must be able to act. Which means citizens must be able to pass an initiative or call a referendum on a law passed by legislators.

Americans overwhelmingly agree, but some reformers don’t get it.

Once I argued with a major term limits supporter who suggested that term limits would improve legislatures enough to render the initiative process unnecessary.

Not long after, I debated an advocate of public financing for political campaigns. He said the initiative wouldn’t be needed once his reform was achieved.

There are many reforms. Because we live in an ever-changing world, we need the ability to keep making reforms. That’s the voter initiative.

This is Common Sense. I’m Paul Jacob.

Categories
local leaders

A Burr Under the Government Saddle

His name is not Dan Kramer Burr, it’s simply Dan Kramer. The “Burr” stands for what he is, metaphorically: “a burr under their saddle.”

The “their” stands for Delaware’s Sussex County Council.

I found out about Dan on SunshineReview.org, which not long ago honored him as Sunshine Troublemaker of the Week. A local paper’s profile on the semi-retired bean farmer filled in some fascinating details.

He sits near the back of the room, and, before meeting’s end, he stands up to introduce himself. “This is Dan Kramer,” he explains . . . but doesn’t really need to. In Sussex County he’s attended more meetings than even the elected officials.

The paper calls him an ombudsman . . . and that fits, for his telephone answering machine sports an interesting outgoing message: “Your problem is my problem,” it intones.

And, by going to every meeting, he can help. His voice carries weight.

He carries a copy of the Freedom of Information Act to every meeting. And he’s a stickler on a number of subjects. “People call me a watchdog,” he admits, but goes on to clarify: “I’m really a junkyard dog who will bite you in the gasket.”

My kind of troublemaker.

I hope you have someone like him in your area. If you don’t, the position is yours to take. According to Dan Kramer, the rewards are many.

This is Common Sense. I’m Paul Jacob.

Categories
initiative, referendum, and recall

Letting Citizens Vote

Congressman Randy Kuhl has the right idea. Or half of it.

His notion is to let constituents help him choose the bill he will introduce in the Congress this fall. It’s part of what he calls the “Fix Washington” Project. Most people think Washington is broken. So Congressman Kuhl wants constituents to tell him how it might be fixed.

Voters in his district were invited to submit their suggestions for legislation that might put DC back together again. He received four hundred suggestions. Of these, he picked five for everybody to vote on. Some of the proposals make me think that my idea of fixing Washington isn’t always the same as other people’s idea of fixing Washington. But I like number five: term limit the Congress.

The proposed term limits are kind of weak, capping the tenure of both senators and House members at twelve years. And I doubt such a bill would get past square one with this Congress. But sure, let’s go for it. At this moment, the winning proposal hasn’t been announced. But I’m rooting for term limits.

I’m also rooting for a way to give all voters a chance to propose and even pass laws statewide, locally, nationally. Twenty-four states have the right of citizen initiative, which enables voters to end-run the stonewalling of their sometime representatives. Let’s make that possible everywhere.

This is Common Sense. I’m Paul Jacob.