Category Archives: markets

The FTC Misunderstands

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The Federal Trade Commission in its 100-year history has never agreed on formal principles for policing companies engaged in “unfair” competition. That looks set to change.

Members of the FTC are close to a bipartisan agreement to lay out for the first time how the commission views its authority to bring cases against businesses it believes compete unfairly, according to people familiar with the deliberations.

An accord would be a breakthrough for Democrat and Republican commissioners who have clashed over when and how the FTC should deploy the century-old Section 5 of the FTC Act in enforcement matters. The provision declares “unfair methods of competition in or affecting commerce” to be unlawful. But the agency has faced criticism that with no formal guidelines or parameters, it is hard for anyone—businesses as well as regulators—to know what may be considered unfair.

“Unfair” in this context is a purely legal definition, and there already are laws on the books governing what is and is not permissible in our commerce. We have anti-trust laws that govern abuse of monopoly power. We have truth-in-advertising laws that govern how businesses can market their products. We have contract laws that sanction dishonesty in contract negotiations and that define liability when mistaken, but fundamentally honest, statements are made in those negotiations.

That’s all that we need, that’s all the FTC needs, and the FTC has had that for well over 100 years, dating at least to the Sherman Antitrust Act. This new “accord” will be just another bureaucratic nightmare, adding layers of compliance requirements and determinations to any FTC action—and so elevating costs for any business the FTC contemplates violating in some way.

Underlying all of that is all of this: Americans don’t need a rule, or a “guideline,” to govern every aspect of every action in their lives.

Democrats and Planned Parenthood

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The Senate failed a cloture vote on a bill related to one already passed by the House that would have diverted some $550 billion of American taxpayer money from Planned Parenthood and sent it, instead, to a number of other women’s health facilities around the country, facilities that don’t do abortions. The bill would have preserved access to health care for women who need it and don’t have, for instance, the economic resources to get it. As a result of the failure, the bill is near death—Majority Leader Mitch McConnell (R, KY) voted against it when it became clear it would fail; his vote means he can bring it up again this session. He and his fellow Republicans have said the question is far from dead.

The Senate Democrats who caused the cloture vote to fail, though, did so explicitly because they want that money to keep going to Planned Parenthood. The key distinction between Planned Parenthood and the other women’s health facilities? One dissects aborted babies’ bodies for parts, and the others do not abort babies in the first place.

So much for any war on women. Sending money to women’s health facilities—regardless of whether you think the Federal government should be doing that at all—hardly constitutes a war on women.

Never mind, too, the increased risk of breast cancer that women face from pregnancies that are catastrophically interrupted (from any of a variety of causes of which abortion is one).

The Democrats’ war on babies, though….

Some Duplicity in Obamacare

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Recall that a while ago, in 2014, the GAO ran some tests of Obamacare: they set up 12 fake persons with invalid Social Security numbers, fake citizenship, and/or false income claims. Eleven of these got coverage, several of them got subsidies, many of them got renewed for this year, and some of the renewals got increased subsidies.

…officials running Obamacare told the GAO they possess “limited ability to respond to attempts at fraud….”

Worse, these guys added in wide-eyed innocence

that measures to ensure program integrity would undermine “consumers’ ability to ‘effectively and efficiently’ select Marketplace [Obamacare] coverage.”

It’s like voter ID: if we protect the sanctity of an American’s vote, the Democrats’ favorite demographic—the frauds—won’t be able to vote Democratic.

Changing the Subject

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Planned Parenthood and President Barack Obama are partners in this misbehavior.

Recall the hoo-raw over the videos published by Center for Medical Progress showing Planned Parenthood doctors discussing the best way to harvest valuable (monetarily) body parts from freshly aborted babies. Planned Parenthood President Cecile Richards spent her time decrying the videos as “edited” and insisting that Planned Parenthood behavior was both legal and ethical.

Obama’s only comment on the matter came through his Press Secretary Josh Earnest, and it was centered on the editing and a repeat of Richards’ claim of “ethical behavior.”

Neither of them addressed the question of aborting babies and cutting out the good parts for resale (or “donation”). Both of them ran screaming from the subject.

The PRC’s Markets

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Beijing thought they could “rescue” the PRC’s stock market. Recall that those markets had tanked collapsed last month, with no bottom in sight. Then the government stepped in:

There is the buying program financed by the central bank. A state pension fund has gone into equities for the first time. Beijing mandated that anyone holding 5% of a company can’t sell for six months. And brokerage firms, directed by regulators, are sitting on a boatload of shares as inventory, notes Erwin Sanft of Macquarie.

There’s also the government rule that stocks aren’t allowed to fall more than 10% in a day—at that threshold, trading in the stock must halt. This, of course, only adds sell-off pressure to the next day…. There are additional overt government interferences, but you get the idea. Associated with this, the markets stopped falling and rose quite a bit. And there’s the PRC buying for its government accounts shares of Chinese blue chip companies, ostensibly to prop up those share prices.

Monday, all that propping up came to a screeching halt. Those markets fell, in that single day, 8.5%, and the representative indices stand at just 5% above the pre-intervention low of three weeks ago.

All of that fall represents investors—at least the ordinary citizenry and those investors not directly under government control—leaving the PRC’s markets. At this pace, the only players left will be the government and its agencies and government run “private” institutions. And the government’s blue chip stock holdings.

That’s a centrally planned economy by another name.