Tag Archives: political economy

Yet Another Reason…

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…for State and local jurisdictions to stop taking government funds. This one is from HUD.

In proposed regulations that would touch any jurisdiction that accepts any sort of HUD funding, fair housing must mean a plan to “promote equity in their communities, decrease segregation, and increase access to opportunity and community assets for people of color and other underserved communities.”

Sounds reasonable.

However.

Those required to comply will include more than 1,200 cities and counties receiving HUD funding. All will be required to develop “equity plans.”
Such equity could mean anything from building low-income housing to redrawing school district lines for racial or socio-economic integration, all as assessed by the HUD bureaucracy.

Because folks moving from here to there still will be told, on arrival there, where they will be permitted to live and where their kids will be permitted to go to school and on and on—they’ll still be under government control. If they want, for good or bad reasons, to live with folks who look like them, or who share their values, or…, central government under these rules will not permit them that choice.

Racial discrimination in housing is pernicious, Husock concluded his piece (at the link). But he doesn’t go far enough in his conclusion. For Washington to invoke it to socially engineer neighborhoods across America is dangerous. No. For the Federal government itself to give special treatment to one group of Americans over other groups of Americans is especially pernicious racism.

This is another example of Federal government funds that are being transferred to State and local jurisdictions coming with strings attached, for good reasons or ill. Government strings only increase the central government’ ability to dictate terms to locals, to reduce our States to the same relationship to the central government as counties have relative to their States: merely convenient districts whose sole purpose is to enforce Federal law. That works for counties in States, but the structure of our system of federal government puts the States—individually as well as a group—on par with our central government on nationally domestic matters—and on higher authority on matters domestic to an individual State.

It is this federal republican structure, the role of our several States as [50] separate experiments in democracy, that string-loaded Federal funds transferred to States and locals so severely deprecates.

Should be Good for Us

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Russian President Vladimir Putin wants to start another arms race, which of necessity includes a technology race and a matching of economic strengths.

Russian President Vladimir Putin said Tuesday that Russia would suspend its participation in the last remaining nuclear-arms treaty between Moscow and Washington, a vestige of the security architecture that has helped keep the peace for decades.

Despite the outcomes of Progressive-Democrat Party policies, we still have the strongest economy in the world, with lots of potential for getting even stronger, and we still have the largest economy in the world, with lots of potential for getting even larger. That feeds into our ability to innovate more rapidly than our competitors or our enemies, and so more rapidly in technology arenas, including weapons and cyber tech. And both our economic and technical capabilities potentiate our ability to produce existing weapons and the ammunition and logistics systems needed for them faster than our competitors or our enemies, and to more quickly develop new weapons and get them deployed in useful numbers.

We dissolved the USSR with that nation’s initiation of its late-stage arms race. Russia’s economic and technological establishment is even more fragile.

The People’s Republic of China? That nation is stronger than Russia, but not as strong—still—as the USSR was.

There’s this, too:

An entente between the two would replicate their Cold War anti-Western partnership with one significant difference, that Beijing rather than Moscow would be the dominant partner.

That prior entente was one in which the two nations routinely exchanged gunfire across their border, especially along the Amur River. One factor leading to those exchanges is the PRC’s—and Kuomintang China, and emperor-ist China and on back—longstanding holding that Siberia belongs to China and that Russia stole it centuries ago. This time around, the PRC is not only the dominant partner, it’s much more dominant than was the USSR in that prior arrangement. And the PRC still insists that Siberia is Chinese. Gunfire exchanges would be much more dangerous for Russia, although it would bleed the PLA, also.

That’s a risk worth taking seriously, but this is the much more likely outcome:

The prospect of the two great autocratic powers that dominate the Eurasian landmass moving closer together carries risks for Beijing. It would probably force European countries that now are hoping to maintain close commercial ties with China to move more decisively toward Washington, on which they depend for security. If that happened, geopolitical competition between the West (along with Asian democracies such as Japan and South Korea) and the Moscow-Beijing axis would solidify.

And that also would redound to the benefit of the US and to the West in general, for all the reasons listed earlier.

Bring it.

Lobbyists

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In particular, lobbyists representing the interests of the People’s Republic of China and companies domiciled there.

It turns out that the multinational retail and tech conglomerate Alibaba—headquartered in Hangzhou, Zhejiang, PRC—has lobbied, and donated lots of money to, American politicians, to the tune of $2.5 million just last year.

And this, via Voice of America:

Public information shows that Mercury, a lobbying firm, lobbied the White House repeatedly on behalf of Alibaba on technology policy issues, access to US capital markets, issues related to e-commerce, and small- and medium-sized enterprise export promotion.

That brings me to my beef about lobbyists and the White House. It’s one thing (however questionable or legitimate) for lobbyists to jawbone White House officials on behalf of companies, whether foreign or domestic. It should be unacceptable for lobbyists to jawbone White House officials on behalf of foreign governments—which in the case of the PRC, includes all businesses domiciled there, since all of those businesses are arms of the PRC’s intelligence community under that nation’s 2017 national intelligence law.

Foreign governments, in particular the PRC government, already have professional, talented, and perfectly suited lobbyists to White House officials: those governments’ Ambassadors and ambassadorial staff personnel. No one else should be lobbying.

Yet Another Reason

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…to stop trading with and to bar exports altogether to (and imports from) the People’s Republic of China.

A US manufacturer of X-ray equipment had a decade-old patent invalidated by a Chinese legal panel. A Spanish mobile-antenna designer lost a similar fight in a Shanghai court. Another Chinese court ruled that a Japanese conglomerate broke antitrust law by refusing to license its technology to a Chinese rival.

This is the PRC weaponizing its legal system as that nation prosecutes the economic axis of its cold war against the US and against the West in general.

This goes further, to include efforts to extend PRC legal jurisdiction into other nations:

In December, the EU sued China in the World Trade Organization on behalf of Swedish telecom-equipment maker Ericsson AB and other companies, complaining that China has barred EU companies from suing to protect their patents in courts outside China. The EU called China’s policy “extremely damaging,” saying Chinese companies requested the intervention “to pressure patent right holders to grant them cheaper access to European technology.”

This is just naked theft by a nation that insists on using its laws and courts as weapons of war rather than as tools for protecting its citizens.

It’s time for us and for the EU to stop technology transfers—under any guise—to the PRC, and that must include what I wrote in my lede: bar all exports to the PRC and stop trading with that enemy nation. The transition will be deucedly expensive, but it’ll only get more so the longer we dither and delay taking that step.

Debt Limits and Spending

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The Congressional Budget Office is out with its projection for our nation’s economic future.

As for the much-discussed federal debt, the nearby chart shows how fast it has grown in the last several years. Debt held by the public—the kind we have to pay back to creditors like the Chinese and Japanese based on contracts—is now 97% of the economy, and will soon rise to 100% and keep going to 118.2% in 2033. How high can it go before creditors stop lending? No one knows, but it will be ugly if they do.

Here is that nearby chart:

This illustrates the tight relationship between spending and debt limits, and why future spending cuts must be part of negotiations related to raising today’s debt ceiling limit. It’s barely possible to see any effect from the 2011 debt limit increase that was agreed in exchange for some “freezing” of Federal spending levels, a pseudo-freeze that in the end ended rather quickly.

There need to be real reductions in Federal spending, not just a reduction in spending growth or even a pretend freeze. There’s plenty of room in welfare spending, for instance, for cutting. Furthermore, all Federal spending is discretionary, the bad habit of calling some spending mandatory notwithstanding. Finally, to put a legitimate floor under spending (which doesn’t contradict the forgoing because it’s a floor not a mandatedly ever-increasing level), there’s a Constitutional requirement to spend adequately on national defense and debt repayment.

In the end, too, tax rate cuts, leaving more money in the hands of private economy actors—us average Americans and our businesses—leads to increases in Federal revenues. This has been empirically demonstrated by every tax rate cut since President John Fitzgerald Kennedy’s reduction of the top rate from the neighborhood of 90% to the region of 70%.

Federal spending cuts coupled with Federal tax rate cuts—they’re win-win for our economy and our nation, if only the Progressive-Democratic Party politicians in Congress and the White House would get out of the way.