Category Archives: Economics

Miscellaneous economy stuff

A Good Start

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President Donald Trump (R), through Treasury Secretary Scott Bessent, has announced Operation Economic Outcast, a far more broad based and farther reaching set of economic sanctions on Iran than any prior set.

It’s a badly needed expansion of the economic circumcision of Iran, but it assumes that the terrorists running Iran will feel the pain of the cutoffs and isolation that Iranian citizens will experience. That’s unlikely, since those terrorists don’t care about their subjects, only about their personal power and their mantra of destruction.

A kinetic component remains badly needed.

Sanctioned oil tankers need to be seized wherever they are, whether or not they still have Iranian oil on board, and they need to be sold to legitimate shippers or to breakers.

The roads, railroads, bridges, and pipelines in Iran that carry oil, natural gas, and other cargo toward the People’s Republic of China need to be cut in several places, with the servicing repeated as necessary.

Shipping in the Caspian Sea that carries Iranian goods to Russia or to other nations on that Sea for transshipment to Russia and that carry foreign goods to Iran need to be sunk.

These kineticisms won’t impact the terrorists’ pain threshold enough to get them to accept the terms of renouncing and dismantling their nuclear weapons program and acknowledging that the Hormuz Strait is international water and not controlled or influenced by Iran. They will, though, severely circumscribe the terrorists’ ability to do much of anything beyond Iran’s borders.

That Part Would be Easy

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In California Progressive-Democrat Attorney General Rob Bonta’s ongoing feud with Paramount, which is attempting to acquire Warner Bros. Discovery, Bonta now is going to demand that Paramount sell off some cable channels and commit to keeping its movie studio separate from Warner Bros. Disney.

It wouldn’t be the end of the world for the new company to sell off a few of the loser cable channels (there always are some, or at least a few that are the smallest revenue generators and/or with the smallest margins). The truly easy part, though, would be the bit about keeping Paramount‘s movie studios separate from Warner Bros. Disney. Simply relocate Paramount to Tennessee, and move Warner Bros. Disney to, say, Texas. Then set up the two to be overseen by an executive in the C-Suite of the new company rather than merging the two studios into a single set with a common senior direct management team.

The real benefit, to Paramount, to Warner Bros. Disney, to the combined company, to the employees of all three, and to the shareholders of all three, would be getting them all out of California with its decidedly anti-business environment and enormous cost of living* and into business-friendly environs with their concomitant much lower living costs.

 

*A $100,000 salary in Los Angeles would need only $62,000 to match its value in upscale Plano, Texas, and only $58,500 in Nashville, Tennessee.

Rent Freezes

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Are rent freezes unconstitutional? The question comes up in my pea brain by the moves of Democratic Socialist and Progressive-Democrat Mayor Zohran Mamdani’s move to freeze rents in New York City (though he’s merely expanding on prior city administrations’ rent freezes) and of Democratic Socialist and Progressive-Democrat candidate for Florida Senator Angie Nixon, whose campaign platform plank was a national rent freeze.

The Fifth Amendment says, in part, nor shall private property be taken for public use, without just compensation. A rent freeze plainly caps a landlord’s income, blocking him from increasing it at will or even consistently with market values or imperatives.

Nah—that won’t work. Government can’t take what doesn’t exist, and those increases are purely speculative.

But those rent freezes lead to reductions in value of the landlord’s property through denial of the revenue increases required, not merely useful or even needed, to maintain his rental properties in the face of rising costs of maintenance through aging degradation, misuse or abuse of the property by the tenants, and inflation which drives the prices plumbers, electricians, etc must charge.

Surely that freeze-driven devaluation of the property constitutes a taking within the meaning of the Amendment.

Probably not here, either. For one thing, the government wouldn’t be taking for public use, it would be just taking. That’s a technicality. One the merits, it likely isn’t a taking at all. All government regulations in one form or another impact the value of the businesses in the industries being regulated. In some cases, those regulations actually increase the value of the regulated industry participants. If regulatory caps are takings, then regulatory-prompted gains would seem to be taxable capital gains.

But those gains aren’t transfers by government to the regulatees anymore than the regulation-driven losses are takings.

Rent freezes are bad for business, bad for tenants in the long run, and bad for government revenue, but they aren’t unconstitutional. Just monumentally stupid.

The Evils of Dynamic Pricing

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At least according to Massachusetts’ Progressive-Democrat Senator Elizabeth Warren.

To hear Senator Elizabeth Warren tell it, dynamic pricing is the biggest scam since Madoff. She has her war bonnet in a twist at the idea that brick-and-mortar retailers could do what e-commerce sellers have been doing for decades.

The trouble with her position is that all pricing in a free market economy is dynamic, as Hennessey pointed out in his article. Warren is pretending that she’s only talking about prices being changed in “real time,” but she carefully declines to specify what time frame constitutes “real time.”

The only time frame within which it would be wrong to change pricing, though, is between price agreement and delivery of the product to the specific purchaser, as illustrated in a couple of dumba** TV ads involving pizza delivery and hamburger joint ordering (even though the latter’s price changes occur before the customer makes his order).

Canceling dynamic pricing, though, is strongly consistent with the Senator’s socialist goal of government controlling production, which would give, also, control over pricing to government.

Next up: Warren comes out against dynamic pricing in the stock and bond markets. That’s the epitome of prices changing across traders, where one trader gets one price, and another trader gets another for the same product. That’s a fast-moving environment, though, where traders acting at different times, even measured in seconds, will get differing prices, and an environment (now slightly different from dynamic pricing per se) where traders offer different prices within the same bid-ask spread. Even in the stock and bond market, though, the agreed prices don’t change in the time between acceptance and fulfillment. But a freely operating stock or bond market (much less both) is anathema to a socialist.

Rationing Energy

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It seems that the cost of energy to end users—us average Americans and our businesses—is higher in Progressive-Democrat-run States than in Republican-run ones.

Always On Energy Research and the Institute for Energy Research…completed an analysis of electricity rates and found that residents of blue states see higher electricity bills than those of red states.

Tom Pyle, Institute for Energy Research President:

While there are many factors that influence electricity rates, the one constant we see is that states that have pursued climate or net-zero policies above all else have some of the highest rates in the country[.]

For example,

California mandates 100% carbon-free electricity by 2045 and operates a cap-and-trade program, while its average electricity price has climbed from 16.6 to 27.6 cents per kilowatt-hour since 2018 [2nd highest in the US]. New York requires a zero-emissions grid by 2040, and its average price has risen from 14.8 to 21.6 cents per kilowatt-hour [8th highest in the US][.]

Other Progressive-Democrat States, from the report:

  • Hawaii’s average electricity price was 35.72 cents per kilowatt-hour in 2025, highest in the US (excluding DC)
  • Rhode Island’s average electricity price was 25.86 cents per kilowatt-hour in 2025, 3rd highest
  • Connecticut’s average electricity price was 25.68 cents per kilowatt-hour in 2025, 4th highest
  • Massachusetts’s average electricity price was 25.56 cents per kilowatt-hour in 2025, 5th highest

By contrast,

  • North Dakota’s average electricity price was 8.2 cents per kilowatt-hour in 2025, 51st highest—lowest in the US, even including DC
  • Oklahoma’s average electricity price was 9.5 cents per kilowatt-hour in 2025, lowest in the US, back to not counting DC
  • Louisiana’s average electricity price was 9.5 cents per kilowatt-hour in 2025, 2nd lowest
  • Nebraska’s average electricity price was 9.55 cents per kilowatt-hour in 2025, 3rd lowest
  • Idaho’s average electricity price was 9.74 cents per kilowatt-hour in 2025, 4th lowest
  • Wyoming’s average electricity price was 9.75 cents per kilowatt-hour in 2025, 5th lowest

Beyond mere rankings, those are some pretty significant dollar differences in costs.

Mandating “green” sources for producing energy, which results in increasingly unreliable energy production and delivery, which results in increasingly unreliable energy at the end user level—that’s functionally rationing energy, even if that’s not the goal of the green funding industry, although the goal of the climate funding industry affirmatively goes much farther: the bankrupting of hydrocarbon-sourced energy producers. The only distinction here is that the rationing isn’t on the demand and price side, rather it’s on the supply side.

And as any pupil in a high school economics class understands, limiting supply without concomitant reduction in demand—via whatever mechanism—produces increasing prices to those end users.

This is what Progressive-Democrats running those blue States studiously ignore as they blithely enact mandate after mandate to use more “green” energy, use less hydrocarbon energy, limit atmospheric CO2 emissions, participate in cap and trade emissions programs, or some combination of them all.