Category Archives: Business

Government Fat Cats

An interview with Iain Murray (my colleague at the Competitive Enterprise Institute) on his new book.

[Update a few minutes later]

An excerpt:

LOPEZ: What do you have against the Consumer Product Safety Commission? Do you like lead in toys?

MURRAY: No, I don’t like lead in toys, but I don’t like people who make toys that have never been anywhere near lead being forced to pay $30,000 to prove that to the CPSC, which gets to almost double its budget to administer these ludicrous requirements. I don’t like the fact that libraries have had to sequester children’s books that were printed before 1985 and may have to burn them. Above all, I don’t like the fact that the people who did put lead in our children’s toys were able to lobby for and win an exemption to the testing requirements. Again, this is an issue where people who like wooden toys — often, in my experience, on the liberal end of the political spectrum — can come together with conservatives to oppose this insanity.

LOPEZ: Is anybody doing this reform right?

MURRAY: People such as Scott Walker in Wisconsin and John Kasich in Ohio have twigged that current conditions are unsustainable and have shown political courage in standing up to the government-sector special interests. It’s been a long fight so far and they may yet lose, but they’re showing the way. At the local level, there are municipalities that have done it right, essentially doing away with their government sector entirely. Sandy Springs in Georgia springs to mind. Some places, such as the Southside Fire Department, also in Georgia, have even worked out how to protect public safety without the bureaucracy.

LOPEZ: Does the Tea Party know this?

MURRAY: The Tea Party understands this can’t go on, but isn’t great when it comes to promoting workable solutions. I’m completely with the Tea Party in terms of motivation, so that’s one of the reasons I wrote the book, to give them some suggestions for workable solutions that can get us from here (Greece) to there (a functioning liberal democracy).

LOPEZ: How much of this is about the New Deal and the Great Society?

MURRAY: The New Deal showed the way, but much of this is more recent. In 1990, we spent $2 trillion in today’s dollars. By 2000 we’d only added $300 billion to that, but in the past decade that’s gone up by a further $1.4 trillion. Moreover, even at the height of the New Deal, FDR recognized that allowing government workers to unionize was asking for trouble.

Read the whole thing.

The President’s Bluff

James Taranto has some thoughts on the fading/faded powers of Barack Obama:

A lot of people have been making fun of the president for supposedly saying, “Don’t call my bluff,” as if he’s admitting he’s bluffing. That seems to us a bit pedantic. Surely what he meant was something like “Don’t think you can call my bluff.”

What got our attention about this exchange as reported by Cantor is the president’s threat to take his case “to the American people.” Would those be the same American people who aren’t paying attention and don’t understand all this complicated stuff?

This seems to us an empty threat not least because since his election, Obama has a poor track record when it comes to taking his case to the American people–who still overwhelmingly oppose ObamaCare, give him poor marks on the economy, and think the debt limit shouldn’t be raised even though it pretty much has to be. He always ends up wishing he’d done a better job “explaining” his position, which at least sounds more humble than saying the American people don’t get it.

Of course, even if that’s what he meant, he’s still implying (in fact clearly stating) that it’s a bluff. And he’s right.

[Update a few minutes later]

Charles K. — “Call Obama’s bluff.”

[Update a couple minutes later]

Eric Cantor — “This is not a game.”

[Update a while later]

“Sounds like Obama won’t even call his own bluff.”

On The Chopping Block

(My CEI colleague) Iain Murray says that part of a budget deal should be to eliminate the Department of Commerce.

It’s not actually the first one I’d go after (I’d get rid of e.g., Education, Labor and Energy first), but I understand the potential appeal. But it does serve many necessary functions that would have to be redistributed elsewhere. For instance, the National Institute of Standards and Technology (NIST) wouldn’t find a comfortable home in the State Department, nor would NOAA or the weather service. Granted, the latter is kind of a mess right now, in terms of not getting needed new satellites up (particularly now that we’re headed into the heart of hurricane season), though it’s not clear whether that’s NOAA’s fault, or NASA’s, which actually manages the development of the satellites. Also, giving over the commercial export list to the State Department could make ITAR even more of a disaster than it already is. It would also raise the issue of finding a new home for the Coast Guard (and the Space Guard, if we ever get one).

There is a reason that Commerce has been around a lot longer than the three agencies I mention above as better targets — if it didn’t exist, we’d probably have to invent it in some form. And unlike education, energy, or labor, we actually do have a Commerce Clause in the Constitution (flawed and overstretched though its interpretation has become).

High-Speed Rail

is dead:

Advocates have excoriated opponents to high speed rail, but have shown themselves largely utterly unserious about the enterprise as they have put no focus on overcoming major institutional barriers such as the steam road era thinking of the Federal Railroad Administration which is stuck in the 90s – the 1890s – or the mismanagement at Amtrak. Getting to an HSR system that works is going to involve major reform (or replacement) of those agencies since all proven, international HSR systems are illegal in the US under current rules. Witness here also the histrionics about a Republican proposal to privatize the Northeast Corridor rail operations rather than engage with it as a starting point. Even in Europe and Japan, many HSR operations are private, so there’s no reason they can’t be in the US too.

To be clear, though I myself have been ambivalent about the high speed rail enterprise, I do not consider myself anti-rail in the slightest. I agree that HSR could bring potentially significant benefits, particularly in the Northeast, although it’s a somewhat more speculative enterprise in most parts of the country. This is one on which reasonable people can disagree. But however one feels, getting to the benefits will require a properly designed and operated true high speed system, something few of the current proposals would provide.

It’s time to take a major gut check on high speed rail in America and rethink the direction. Clearly, with the budgetary and political situation, significant future HSR investments are unlikely. Even if some billions materialize, the experience of the stimulus suggests that they will be frittered away as salami slices sent hither and fro.

A better approach might be to take some time to think more clearly about what we want high speed rail to look like in America. It starts with learning from best – and worst – practices abroad, while noting the important differences versus the US. We need to put a proper regulatory regime in place and reform the FRA; to set up a framework for a successful privatization of any system, probably with operations contracted to an international operator with high speed experience; and to jettison any thought of Amtrak as the ultimate HSR system operator.

But all of that would defeat the true purpose of the system. And unfortunately, many of these programs will zombie on, especially in those states that can least afford them (like California) until the real economic tsunami hits. But I think I can already start to see the waters starting to recede…

Raise Taxes

…or Granny gets it:

…he drew plaudits from what used to be called the mainstream media. “Obama Grasping Centrist Banner in Debt Impasse” read the New York Times headline. The Washington Post’s Chris Cillizza dubbed him “Dad-in-Chief,” explaining: “Boil Obama’s message down and you get this: Adults sometimes have to do things that they don’t want to do. This is one of those times. So, let’s get it done.”

The kids are acting up, so he threatens to starve Granny to death. That’s just how a strong father behaves.

It looks to us as if Obama may once again be overestimating his persuasive powers by relying for feedback on journalists who, for a combination of ideological, partisan and personal reasons, are predisposed to take his side. NewsBusters.org has a useful compilation of what it calls the “softballs” reporters lobbed at yesterday’s press conference. Some of them were actually a bit adversarial, but only from the left.

I hope he continues to live in his leftist media cocoon. It will only reduce his chances of reelection.

His advice to the American people seems to be that if one has a problem with taxes, one should get better tax software and stop asking so many questions, or find the severed head of a horse in your bed.

If I were a Republican candidate, I’d make a statement that, if I were president, I wouldn’t use the elderly as human shields to compel people meet my unreasonable demands.

[Update a few minutes later]

Speaking of press sycophancy, is Obamageddon coming to a city near you?

The election of the first African-American president was widely hailed as a giant step forward for American racial politics. The future, however, may remember this administration as a giant step back for Black America during a period of deepening alienation, anger and despair in America’s inner cities.

Not since the 1960s, when scores of American cities were shaken by one race riot after another, have African-Americans faced such deadly conditions: high expectations and hopes running up against a reality of vanishing jobs, shrinking government budgets and a fractured and fragmented leadership. Barring an unlikely change in economic fortunes we could soon face a new period of explosive anger and even violence; alternatively, the urban poor could fall prey to a new kind of passive despair and anomie as hope dies on one inner city street after another.

Either way, the mainstream press’s slowly fading intoxication with the Obama administration has led it to miss the dimensions of the new urban crisis now stalking the United States. The liberal Reagan, they swooned back in the good old days. No — the new FDR! No, wait! The new Lincoln!

But as the rosy glow surrounding the administration and all its works slowly dies away, many Americans will be taken aback at the urban crisis that quietly and unostentatiously took shape while the fatuously exhilarated press choirs sang about the hope and the change that was coming our way.

It is ironic that he may be the worst president for blacks, ever.

[Update a while later]

The president needs to stop scaring seniors. Apparently he disagrees.

Our Brilliant Betters

Let’s see, does Kathleen Sebelius have any business experience? Hmmmmm…nope.

I guess that might explain how she could say something so monumentally stupid:

Health and Human Services Secretary (HHS) Kathleen Sebelius told CNSNews.com on Monday that a provision in President Barack Obama’s health-care law that requires small businesses to begin buying health insurance for their workers when they hire their 50th employee–or otherwise pay a penalty to the federal government–“will actually be a great incentive” for businesses to grow.

Not to imply, of course that there couldn’t be other explanations.

[Update a few minutes later]

More from Ed Morrissey.