Tag Archives: political economy

Wasted, Slow, and Toothless

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The European Union is moving, in its glacially stately pace, toward addressing another vestige of slavery: the use of forced labor in production.

The Council of the EU on Tuesday approved a regulation that would forbid throughout the bloc’s 27 member states the sale of goods made with forced labor either within Europe or outside it.

That’s broader than the US’ ban on forced labor, which is primarily targeted at the People’s Republic of China’s use of Uighur forced labor. So far, so good. Unfortunately, the Council then wasted the effort.

The Council said the regulation will be applied three years and a day after it is published in the European Union’s official register.

There’s no reason for that much delay; it needn’t take that long to adjust supply chains, even by the bureaucrats of European businesses. Eighteen months to two years from enactment is all that’s really needed.

Then,

Investigations into forced labor within the bloc will be led by national governments, whose decisions will be binding on all EU members, the council said.

That’s the toothless part. A national government (Slovakia? Hungary? Germany?) that decides a region’s forced labor matter really isn’t by its own standards would bar all the other 26 member nations from objecting to that region’s use of forced labor as defined by any of those other member nations.

Another Misapprehension

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Some tax cuts are better than others goes the headline, and that’s true enough. But then the newswriter wanders afield.

…extending the lower individual tax rates that expire after 2025—by far the largest component of any likely tax bill and the one that directly affects the most voters—would put more money in consumers’ pockets without driving a meaningful change in the economy’s long-run trajectory. There is broad bipartisan support for retaining those lower tax levels that Republicans created in 2017, but keeping individual tax rates in place is unlikely to change most people’s decisions about whether and how much to work.

It’s certainly true that not all tax cuts would change, or have any effect, on us taxpayers’ spending behavior. So what? Those favoring higher taxes have yet to articulate a coherent government need for the money, beyond expansive welfare payments and expansive welfare transfers to the States—all without any sort of work requirement.

At bottom, too, it’s our money, not government’s, and we should be the ones who decide how to spend it, or not. Nor do the taxers and government bureaucrats and politicians get to tell us how or whether to spend our money—not directly (that’s part of the intrusiveness of Obamacare that has yet to be corrected), and not indirectly by taxing us and spending our money in government’s name. We’ll allocate our money to our financial needs and desires far more efficiently and with far more specificity than government can ever be capable of.

Full stop.

Regulatory Oversight

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The Wall Street Journal outlined what its newswriters think are the four priorities of the incoming FCC chairman Brendan Carr, assuming he gets confirmed. On the whole, those priorities foster reduced government involvement in business decisions and increased business competition. One of those priorities drew my eye, though:

Clearing a path for media consolidation

One consolidation possibility: Meta or Alphabet or Truth Social acquiring one or more of the legacy broadcast media: ABC, or ESPN (OK, that’s a legacy cable medium, but my point stands), or….

That would create some serious consolidation, and I’m not convinced that degree, or consolidation across those milieus, would be a good idea.

Still, let the markets determine the utility of such acquisitions, within government’s optimal oversight: blocking abuse of monopoly power rather than blocking the monopoly itself. Aside from the economic forces involved, the one is a reaction to an actual misbehavior, the other would be a preemptive action regarding a purely speculative outcome.

One of those would remain consistent with the American style of jurisprudence, and that’s to the general good.

Labor Unions, Labor Workers, and Employers

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The lately formed Republican Party coalition, led by President-elect Donald Trump, consists of business-friendly and labor-friendly folks from opposite wings of the party.

Opposite, though, is not the same as opposing, a distinction the misconception of what’s involved masks. For instance:

People close to the transition said Trump’s potential appointments to key labor positions could include old-guard Republican functionaries, corporate executives, or individuals who are closer to the New Right and see themselves as more pro-worker.

Maybe and individuals who are pro-worker.

This makes plain the misconception:

[U]nion officials said Trump’s record is at odds with his pro-worker rhetoric. “It’s going to be a rude awakening for a lot of folks who wanted to take Trump at his word,” said Steve Smith, a spokesman for the AFL-CIO, which campaigned for President Biden and, subsequently, for Vice President Kamala Harris. “They talk a big game when it comes to workers, but…they’re going to attack the working class.”

Not at all. It’s entirely possible—useful, too—to be both pro-company and pro-working class while simultaneously opposing today’s unions. This is especially the case with today’s unions, where union management, far from concerning themselves with their membership—those working class folks—concern themselves more with what’s good for them personally.

That misplaced concern includes threatening employers with destruction of their businesses—striking and denying the businesses’ ability to function at all unless and until the union managers get their demands satisfied—and with ripping off workers with their efforts to force unionization in businesses where employees continually reject unions in labor votes. Union management in the past ripped off workers even more blatantly by exacting tribute union dues from workers whether they were union members or not. Court rulings have slowed that particular abuse, but they’ve not eliminated it.

What’s needed, and what becomes possible with the incoming administration, is bringing those pro-business and pro-labor folks into the same room to work out processes that benefit both, without the middle man union management in the room clouding things up and constantly trying to pit the one against the other, rather than helping them collaborate on business-labor policies.

Inflation vs Prices, but Not in Isolation

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Not in isolation from each other, but more importantly, not in isolation from other factors that also impact our economy.

The Biden-Harris administration and the associated “advisors” on staff focused on inflation during the just concluded campaign season (the article at the link mentions spending packages during the first Trump administration along with spending packages at the onset of the Biden-Harris administration as causes of that inflation), but they missed other key factors.

…roughly 40% of voters said the economy was their top issue, far outstripping any other. Those voters backed Trump by a 22-percentage-point margin. Inflation has declined without a recession, but many were thinking instead about how prices are still high.

This was while the Progressive-Democrats and the Left kept on about how inflation was abating (that the Biden-Harris administration’s spending had caused the sharply higher inflation is beside the point of this post), while us average Americans were concerned about prices. After all, we pay our bills based on actual, extant prices, not based on how prices change from time to time.

That’s not all, though:

White House officials interviewed for this story defended their record by pointing to how the ARP was designed at a time when it wasn’t at all clear the country was about to escape the pandemic. Virus counts and deaths were rising as Biden took office.

The data, collected in real time, made clear that while the Wuhan Virus was enormously contagious, it wasn’t very dangerous except to one relatively small slice of our (and the world’s) population: the very old and especially those with severe comorbidities. Outside of that, the mortality rate from the virus was a very small fraction of one percent; even the risk of hospitalization was not much larger than that tiny rate. The rising virus counts and deaths were solely the result of the virus’ enormous infection rate.

And yet, the Biden-Harris administration extended the virus-related declared national emergency for another two years, which facilitated the administration’s ability to control our economy wholly independently of actual economic factors.

Then,

Strong demand from Biden’s additional fiscal stimulus…ran headlong into crippled supply chains and discombobulated labor markets.

This would have been known, and was at the time, to any high school economics student. The hard drop in labor had already occurred—those shutdowns—and was already in rapid recovery at the end of the Trump administration, for all that employment still had a considerable ways to go, and the disruption to the supply chains—from the various nations’ shutdown of their borders—had already occurred and was in full disruption. It’s a basic tenet of economics, too, that when demand outstrips production supply, prices have nowhere to go but up. It was clear at the time, too, that production supply was going to be disrupted for some time as producers were not going to be able to expand production (they couldn’t even maintain their original production rates) from those labor and input supply chain dislocations.

The administration worthies and the press ignored all of this in their determination to panic-monger and deprecate everything Trumpian in that preceding administration.

There’s this laugher (otherwise it’s simply insulting to our intelligence), too:

White House and Democratic officials have argued that overall US economic outcomes were better than those achieved in nearly every other advanced economy.

Whoopty-do. None of us, average Americans and elitists alike, live in any of those “other advanced economies.” We live here, in our US economy, confronted with our US economic outcomes, and those outcomes were highly disruptive to our lives when they weren’t being outright destructive of our livelihoods.

That these folks still are making excuses rather than learning from those mistakes makes it unlikely that Party can be trusted with our economy any time soon.