Category Archives: regulation

Obamacare Subsidies

Posted on by
Reply

The government—i.e., us taxpayers—will pay for a significant portion of health “insurance” premiums under Obamacare, starting yesterday.  Under Obamacare rules, individuals making as much as 400% of the Federal Poverty Guideline—up to $45,000 per year—will get these subsidies.  Individuals making up to 250% of the Guideline—up to $28,725 per year—will get yet more subsidy (yet more of our tax money) to partly cover their deductibles, co-pays, and co-insurance costs.  The same applies for families, and 400% of the Federal Poverty Guideline for a typical American family of four works out to $94,200 this year.

Think about that.  Under the prior system costs were high.  Obamacare, instead of going after those costs (right wing kook solutions like competition, like letting the doctors and patients decide what care actually was warranted, etc), props them up with those subsidies.

Sounds like manufactured government dependency, to me.

There’s Hope, Again

Posted on by
Reply

Both Colorado State Senators, including the President of the State Senate, facing recall over their gun control legislation lost those recalls Tuesday.  These were solid defeats, too, nothing cliff-hanger-ish about them: State Senator John Morse (D), the Senate President, lost 51%-49%, and his colleague, State Senator Angela Giron (D), lost 56%-44%.

Moreover, these were not California-style recalls, where the firing occurs in one election and a separate election is held later (in which the just-fired incumbent could be a candidate).  These Colorado recalls were elections themselves, and on losing the recall, Morse and Giron were replaced by their opponents—Republicans Bernie Herpin and George Rivera.

The State Senate remains in Democrat hands, and it remains to be seen whether Herpin and Rivera will be any more responsive to their bosses, the citizens of their districts, but this is a clear step in the right direction: those who try to limit our individual liberties—in this case, try to foist onto honest citizens restrictions on 2nd Amendment rights—can expect to be fired forthwith.

The Danger of Accepting Federal Money

Posted on by
1

…made manifest.

Labor Secretary Thomas Perez…threatened to cashier federal grants for 83 local transit agencies because he claimed California’s pension reforms violate the Federal Transit Act, which requires the Labor Department to certify that “protective” arrangements are made for workers (i.e., the Teamsters) before the feds dole out dough.  Nearly $2 billion in federal funds are at stake this year alone.

And there’s this:

In July, HUD published…”Affirmatively Furthering Fair Housing” in the Federal Register…a sweeping set of land-use regulations…. The agency wants the power to dismantle local zoning so communities have what it considers the right mix of economic, racial and ethnic diversity.  A finding of discriminatory behavior, or allegations of discrimination, would no longer be necessary.  HUD will supply “nationally uniform data” of what it thinks 1,200 communities should look like.

Local governments will have to “take meaningful actions to further the goals identified.”  If they fail to comply, HUD can cut federal funding.

Of course, if the States weren’t addicted to Federal handouts, the Feds’ pushers wouldn’t be able to make such threats, much less have this control over a State’s internal affairs.

A Thought on Minimum Wage

Posted on by
1

The current minimum wage is $7.25/hr, and under the guise of that being not enough to live on (it works out to about $15,000/yr before taxes), there’s move afoot to raise the minimum—to anywhere between $9/hr and $15/hr.

I’ll ignore in this post the fact that the jobs that get minimum wage are low-skill and/or entry-level jobs whose product simply isn’t worth very much money.  I’ll ignore, also, the fact that very few minimum wage earners have this job as their sole source of income—it’s a second job, intended to supplement the income from the primary job.

I want, instead, to propose a wholly radical idea: how about reducing regulations, especially for small businesses (the ones hardest hit by minimum wage laws) and lowering tax rates (of which min-wage earners aren’t paying much, but which taxes contribute to the cost of the goods min-wage earners are trying to buy)?  Those tax and regulatory costs drive up our (which includes min-wage earners) cost of living, as the cost of the things we buy is driven by those regulatory and tax costs of doing business.

Here’s a brief look at (aggregated) regulation costs for small businesses.  Daniel Sutter, a Professor of Economics at Troy University, had this information in a recent piece in the Troy Messenger:

…compliance [with Federal regulations] often requires spending on new equipment, signs, or other changes to workplaces.  Both the Competitive Enterprise Institute and Small Business Administration estimate the cost of regulations at around $1.8 trillion.  …this $1.8 trillion (largely hidden) cost of [Federal] regulatory compliance exceeds the revenue from Federal individual and corporate income taxes combined.  It represents almost 12% of GDP, or nearly $15,000 per family, annually.

There’re those $15,000, again.  Also, that aggregate cost equals 10% of the current national debt.

Sutter also had this:

Automobile dealers, for example, must comply with over forty Federal regulations affecting every aspect of their business, from the showroom to the service bays.

They aren’t even allowed to run their own businesses without the Feds looking over their shoulder, telling them how to do so.

And it goes beyond compliance costs.

Regulation reduces the freedom of individuals and businesses to innovate or create new products.  Regulation reduces productivity growth, ultimately reducing standards of living, and particularly burdens small businesses, which are the source of many new jobs.  The greatest cost is likely the new products, services and businesses that are never created because of regulation.

Now, about those taxes….

The small business owner, rather than the business itself, typically pays the taxes on the business’ income, as that, and its costs, typically are passed through to him.

A small business might have an annual income of, oh, say, $500,000—and if it’s really successful, that’ll generate a profit of $50,000.  Any salary he might take out of the business is on top of that, but let’s ignore salary and only concern ourselves with the income tax on that profit.  On those $50k, he’ll pay roughly $8,400 in ordinary income tax—nearly 17% of that profit ultimately lost to the government—at 2013 single rates.  At married, filing jointly, the bite will be roughly $6,600—13% of his profit lost.

Rather than raising the minimum wage, and pricing the worker out of the labor market, it’d be better to enable the existing wage to go farther by getting rid of all those Federal regulations, and their costs, and lowering tax rates.

Another Government Takeover of an Industry

Posted on by
Reply

…and for what purpose?

The US government has used the merger-approval process to increase its influence over the telecom industry, bringing more companies under its oversight and gaining a say over activities as fundamental as equipment purchases.

The leverage has come from a series of increasingly restrictive security agreements between telecom companies and national-security agencies….

And

The security agreements…compel [telecom companies] to honor requests to access their systems.  What’s new is that consolidation in the industry and an influx of overseas investment have left much of the industry under the government’s sway.

Thus,

Three of the top four wireless carriers now operate under such agreements….

Three of the major equipment suppliers have come under these agreements in recent years as well.

What requests?

The deals routinely require the companies to give the government streamlined access to their networks.  At their most restrictive, they grant officials the right to require firms to remove certain gear and approve equipment purchases and directors.

And

when T-Mobile and MetroPCS sought approval for their merger this year…the US secured 30 days’ notice before the company uses a new vendor for network equipment, and T-Mobile agreed to resolve any security concerns the government raises relating to new equipment providers, according to a 2013 amendment to the 2001 security agreement.

All of this comes under the mirage of trading freedom for security.

Makes me wonder what the government isn’t telling us about why they blocked the AT&T-T-Mobile merger a couple years ago.