Tag Archives: political economy

A Couple of Regulatory Environments

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These need to be dealt with along with the EPA’s effort to deregulate energy production. “These” are the FAA’s regulation of rocket launches—the conservative right blames the FAA’s climate impact concerns, but those are not the only ones—and the FCC’s regulation of satellite deployment. Here, Progressive-Democrats are letting their hatred of all things Evil Rich get in the way of intelligent decision making.

The Federal Aviation Administration separately evaluates the environmental impact of rocket launches in the US, which has in the past delayed satellite launches.

And

Maria Cantwell objected because the bill [that would streamline and accelerate FCC satellite approvals] would help Mr Musk’s AI space ambition.

As The Wall Street Journal‘s editors closed their piece,

Permitting difficulties are America’s economic Achilles’ heel. Let’s hope they don’t get in the way of US space innovation.

Middle Man?

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Andy Kessler touted San Jose Mayor and California candidate for Governor, Matt Mahan, as presenting a sufficiently centered (Progressive-)Democrat who opposes Party’s supposedly (they promise!) one-time billionaire tax on those Evil One-Percenters’ wealth, whether liquid or not.

But, Mr Mahan goes on [says Kessler], “I don’t believe that high-net-worth individuals should be able to borrow against appreciated assets endlessly as a way to avoid paying capital gains.” The mayor of the country’s 12th-largest city thinks that rather than impose wealth taxes, California should press Congress to eliminate the step-up in basis at death, so that estates or heirs would pay a tax on the appreciation of a decedent’s assets. (California has no estate tax.) That wouldn’t put “our economy, our engine of innovation and prosperity, at risk.”

Three guesses where that would take our economy. Here’s a hint:

No one wealthy would own capital assets, whether personal or enterprise—they’d lease them. That would thoroughly alter the structure of our private economy, real, financial, business ownership, and it would do so in ways that we won’t know until it starts happening. That’s dangerous.

And that doesn’t get to the ability of parents to leave to their children what those parents spent a lifetime building—at least not in any substantial way. That’s even more dangerous.

This is an example of careless compromise: Mahan’s position doesn’t move things to the extreme left, but it does move things toward the left, rather than making an even split, much less moving things a little bit to the right. That’s a loss, not just for Conservatives, but for all of California’s citizens, wherever they are on the political spectrum.

Universalized Choices of K-12 Schools

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Our public national education system—an inchoate agglomeration of local public school systems—is badly failing our children and through that badly failing our nation both in our economy and in our national security. Parochial schools, charter schools, voucher schools, homeschooling and pod-schooling (a pooling of homeschooler resources), which I’ll term choice schools—all of these do far better at educating our children than do those public schools, whether run by teacher unions or not. The ability to choose among those options is critical to our children’s education. The competition even produces improvements in the public schools. Hence, ESAs, Education Savings Accounts.

A limitation on ESAs is their funding. Formal funding for ESAs functionally caps their availability for students, with the result that vast numbers of students can’t get into one; the ESA program for their area has expended all of its funds before the enrollment lists got to them. The Wall Street Journal‘s editors propose a solution:

To create truly universal programs, states can remove enrollment caps and fund ESAs outside of annual appropriations…. They can boost scholarship amounts….

More money isn’t necessary. More money would help, even if it is government money, provided it’s allocated and spent wisely—but it would be government money.

More money could be made available for ESAs, if only indirectly, though, not by increasing spending but by allocating existing education dollars to the student rather than to the school district. In this way, when a parent moves his child out of the public school and into a choice school, the money would follow the student to that choice school, defraying the cost of attending that alternative school.

Other mechanisms for supporting school choice also are available. These include State governments removing such barriers to choice as caps on the number of charter or voucher schools allowed to exist in a jurisdiction, forcing homeschooling parents into teacher unions, limiting use of under-used or empty public school facilities by choice schools, onerous licensing and accreditation requirements for choice schools—even caps on the number of students allowed into an ESA program.

Wrong Distinction

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There’s a new challenge, allegedly, for grocers and their junk food sales; although their problem is whether, and if so how much and where, they should stock junk food on their shelves. This is suggested by the headline:

Is a Cookie a Type of Candy? Supermarkets Have a New Food-Stamp Conundrum

This is a trivial question, though, one that awaits only a government definition of what foods are eligible for food stamps. The larger, and the far more serious problem is posed by this claim, buried in the middle of the article:

Critics said that limiting grocery options ignores the real causes of poor diets, such as low incomes, high food prices and access to healthy food. Studies, they said, show little difference between what SNAP recipients buy and the purchases of non-SNAP households.

Say the critics are correct, and food stamp food eligibilities don’t address those root causes. Say, further, that those studies are accurate in their conclusions.

Those criticisms are wholly irrelevant. The fact remains, and it remains unaddressed, as well, that there is no reason for the rest of us to pay with our tax dollars for the poor diet choices those eating on our dime—those food stamp programs—make. If they want those junk foods, let them pay for them on their own dime, just as the purchasers in non-SNAP households do.

How dare we presume so, some might bleat. It’s a simple dare. We’re the ones paying and with our money. We’re the ones who should be determining how our tax dollars are spent.

It’s that straightforward, and it should be that simple.

Electricity Price Controls

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New Jersey’s newly elected Progressive-Democratic Governor, Mikie Sherrill wants them.

Ms Sherrill used her maiden speech to lay out her plans to ease electric rates. “In short, you are sick of the status quo,” she said, “Well, guess what, guys, so am I.” Guess what: Her proposals are more of the same progressive policies that have fueled higher prices: Subsidies, mandates, and price controls.

Especially those price controls.

Her worst idea is a pause on utility “rate increases or cost recoveries to the extent permitted by law.” This is a price control that will reduce grid investment, including in new supply. ….
If utilities can’t pass on their costs, they will skimp on maintenance. It’s that simple.

Of course, those rate increases or cost recoveries permissions are specified by State laws, and Sherrill and her legislature can alter those laws at will. Her “extent permitted” is disingenuous.

Maintenance skimping is well-known to renters in rent-controlled apartments.

If the provider—landlord or utility (or any other)—can’t recoup his costs as those increase, whether they’re supply costs, regulatory compliance costs, or taxes, he has less money to spend on procuring the items he needs to produce electricity or rental housing or… and especially critically, he has less to spend on simply maintaining what he has. Rental homes/apartments and power generators deteriorate, those residences become badly substandard to the point of uninhabitable, and power generation becomes unreliable. That last is bad in a hot summer, and it’s deadly in a cold winter.

With unreliable power generation, we get rolling blackouts where broad areas in succession see the lights go out; oil, natural gas, and coal generators, all of which depend at bottom on electricity, stop; and electric heating (or cooling) systems stop. On-off cycling from those rolling blackouts, even if in longer intervals than shorter, adds to the wear and tear on the generators, and on the heating and cooling systems, requiring increased maintenance for which those price controls, and rent controls, severely limit the money available to pay.

But never mind. Progressive-Democrats want those price controls because that’s their exercise of political power.