More Excessive Government

Posted on 20 February 2015 by eehines

US financial regulators are focusing renewed attention on Wall Street pay and are designing rules to curb compensation packages that could encourage excessive risk taking.

Regulators are considering requiring certain employees within Wall Street firms hand back bonuses for egregious blunders or fraud as part of incentive compensation rules the 2010 Dodd-Frank law mandated be written, according to people familiar with the negotiations. Including such a “clawback” provision in the rules would go beyond what regulators first proposed in 2011 but never finalized.

Congress created a bureaucracy, and it expanded it enormously with that Dodd-Frank. Now the bureaucrats have to do something to justify their existence. Regulators gotta regulate. And so we get this.

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The Judicial Branch and the Law

Posted on 19 February 2015 by eehines

In a couple of weeks, the Supreme Court will hear a case involving Federal subsidies to health coverage purchasers who bought their plans on ObamaMart instead of State exchanges. The Obamacare law limits those subsidies to purchasers via State exchanges argue the plaintiffs; the government demurs.

Some ACA critics fear the Supreme Court may hesitate to block the current subsidies because of a lack of confidence in the legislative branch in general.

Against that backdrop, Supreme Court Justice Ruth Bader Ginsburg has said

The current Congress is not equipped really to do anything[.]

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It’s Time

Posted on 17 February 2015 by eehines

…for the Party of No to get out of the way and let legislation happen. House Minority Leader Nancy Pelosi (D, CA) had this to say through her spokesman Drew Hammill about her fellow Democrats’ insistence on shutting down DHS* in favor of protecting President Barack Obama’s unconstitutional “executive actions” concerning immigration:

With only four legislative days left until the Republican Homeland Security Shutdown, Speaker Boehner made it clear that he has no plan to avoid a government shutdown. The speaker’s reliance on talking points and finger-pointing was a sad reflection of the fact that the Tea Party continues to hold the gavel as they insist on their futile anti-immigrant grandstanding.

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Journalistic…Naiveté

Posted on 17 February 2015 by eehines

Throughout the long negotiations over the fate of Iran’s nuclear program, President Hassan Rouhani has withstood scathing criticism from hard-liners at home by sticking to his case that a deal with his country’s longtime enemies will bring peace and prosperity.

So the political stakes are high for the moderate president as talks enter their homestretch toward a June deadline.

If he succeeds in sealing an agreement, Iran could see much-hoped-for relief from withering sanctions that are dragging down the economy at a time when the OPEC producer is trying to ride out a severe slump in oil prices.

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Who’d-a Thunk?

Posted on 16 February 2015 by eehines

According to President Barack Obama’s Department of Education, his student loan forgiveness program already is experiencing cost overruns to the tune of nearly $22 billion. Obama’s 2010 PAYE expansion at the time was projected to add $9 billion to the taxpayers’ bill for students not repaying their debt. As the DoE put it,

The 2015 amount includes a net upward reestimate of $21.8 billion, primarily related to revised interest rates and increased participation in income-driven repayment plans.

Or, in the words of James Schneider, who wrote the article at the second link,

[S]welling enrollment due to looser loan rules is driving up costs….

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Oil Price “Tax Cut”

Posted on 15 February 2015 by eehines

US retail sales slumped in January for a second straight month…. Sales at retailers and restaurants fell 0.8% last month [January 2015]…. Retail sales dropped 0.9% in December….

This despite sharp oil and gas price drops since the summer, resulting in similarly sharp drops in fuel costs, including especially gasoline and airline jet fuel.

If we’re not spending all those savings, then, where is the money going? One clue comes from a Trading Economics graph.

It was being spent, all through the fall. Then, apparently, the windfall started getting saved.

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Senate Democrats and a DHS Shutdown

Posted on 14 February 2015 by eehines

The House has passed a bill fully finding the Department of Homeland Security while canceling President Barack Obama’s unconstitutional “Executive Actions” regarding immigration. The Senate Democrats have successfully filibustered the Senate version of that bill.

The Senate Democrats thus have shown themselves entirely willing to shut down the DHS, severely damaging our nation’s ability to defend itself against terrorist attack—or any man-caused disaster. These Democrats are holding American citizens hostage against their ability to impose their minority position on all of us.

Let Senator Mark Kirk (R, IL) say this about that.

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Collateral Damage

Posted on 13 February 2015 by eehines

In an era of antiseptic war, one fought with drones and precision weapons that limit to an amazing degree the collateral damage done by these limited strikes executed during very limited conflicts, we’ve gotten spoiled. We expect war generally to be antiseptic.

And our “leaders” in DC have gotten spoiled, too.

Several large-scale cyberattacks in recent months have prompted a number of lawmakers and policy makers to call for a more forceful response, including suggestions that the US engage in counterattacks that would disable or limit the culprits’ own networks.

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A Fatal Flaw

Posted on 9 February 2015 by eehines

In a piece for Wired, FCC MFWIC Tom Wheeler offered rationalization for his decision to dismantle the Internet. He opened his apologia with this remarkable claim:

This proposal is rooted in long-standing regulatory principles….

That’s the problem. Regulatory “principles” proceed from the assumption that government regulation is a universal and primary good.

Of course, that’s precisely backward—and backwards. A free market is almost universally self-regulating: make a bad product, people find out and stop buying—the producer goes out of business. Lie about a product, people find out and stop buying—even if the product itself might be sound—and the producer or seller goes out of business. And so on.

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The Party of Stupid on the Right

Posted on 8 February 2015 by eehines

A group of young conservatives, dubbed “reformicons,” are making inroads among Republican presidential candidates by arguing the party’s traditional reliance on broad-based tax cuts…isn’t enough to cure middle-class woes.
Instead, they are calling for crafting subsidies, tax credits, and other public-policy tools based on conservative philosophies and tastes to help the unemployed and other struggling middle-income households.

And

“For the past 10 years, our biggest issue was whether the top tax rate was 35% or 39.5%. I don’t care anymore,” said Michael Strain, 33 years old and an economist at the American Enterprise Institute think tank. One of his ideas gaining fans on the right: let employers pay some workers less than the minimum wage as an inducement to hire them and use the federal tax code to bump up salaries.

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Category Archives: political economy