Tag Archives: economics

American Companies Beholden to Foreign Governments?

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Now it appears that the Obama administration is taking yet another step to make us look like Europe: he’s negotiating an agreement that could end up requiring American companies, domiciled in America and operating in America, to report to European Union authorities.

Recall the European Court of Justice’s ruling last month that European citizens’ personal data that winds up being stored in the US as a result of various business deals is too exposed and the 15-yr-old, successful data-transfer Safe Harbor agreement between the US and the EU. This is the arrangement that’s being renegotiated, and potentially included in the new agreement is this:

American businesses could be required to report requests by US intelligence services for the data of European users under a trans-Atlantic data-transfer pact now being negotiated, according to the European Union’s justice commissioner.

Worse, it seems to be one-sided: EU companies in the US aren’t being required under this new deal to make similar reports to US authorities.

Hmm….

Democrats and the VA

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I’ve written a number of times about the Veterans Administration and the need to get rid of this dysfunctional government entity.

Now we get Democratic Party Presidential candidate Hillary Clinton doubling down on this failed VA and on her desire to expand Big Government further and to extend crony capitalism to a new arena.

Democratic presidential candidate Hillary Clinton is offering her vision for veterans’ health care, promising to fight full-fledged privatization while proposing the government contract with private providers for a range of health services.

Government has shown its incompetence in matters of health (among others), so her answer—the typical Progressive Democrat answer—is to have more of it. Crony capitalism has shown its profitability for politicians of any stripe, so this Progress Democrat wants more of that pie for herself. She wants Big Government to stay involved in the health care of our nation’s veterans, but she wants to shift that involvement to the health providers her administration will favor.

This would be foolishness if it weren’t dishonesty.

Veteranos administratio delende est.

A Look at Dodd-Frank

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Banks are having trouble peddling risky loans they’ve made in conjunction with the current (and dying down?) mergers and acquisition boom. These are loans made when one company buys another for their mutual benefit, and the buyer borrows some or most of the purchase price.

Here’s the kicker:

In past decades, banks sometimes held the loans until markets stabilized, but such warehousing became prohibitively expensive because of high capital charges required under the Dodd-Frank law that was passed in response to the 2008 financial crisis.

If it becomes too difficult or expensive to borrow—or to lend—to support a merger/acquisition, those deals won’t get done.

Often, the target of the deal is a company in trouble, and the deal would save some or all of the company by merging it with a stronger company that has better management and/or more efficient processes. The deal thereby also saves a large number of jobs (not all—that’ll be part of the improved efficiency in the acquiree). The deal also winds up being beneficial to the consumer as the acquiree’s products or services both continue to be available and often at a lower price.

If the deals aren’t done, those jobs won’t get saved, and the goods and services won’t continue to be available.

Will these lost mergers/acquisitions be a big deal for our struggling economy? I don’t know. But I am very certain that those who passed Dodd-Frank didn’t give an iota of thought to the possibility.

Because Power Addiction

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The headline and sub-headline in the Wall Street Journal article pretty much tells the story.

China Delays Economic Liberalization

As Beijing debates how to quickly boost economy, it delays long-term plans to loosen financial grip

The men governing the PRC do not see the contradiction between their behavior and their actions.

China has taken new steps to slow plans that had been meant to loosen control over the financial system, adding to similar delaying moves since summer.

Never mind that loosening these controls, and all other government controls—all other CPC controls, all other controls maintained by President Xi Jinping and his cohorts—would produce exactly that boost. Leaving money and decision-making in the hands of the general population citizens, the hands of the folks who earned that money and who, as rational adult human beings, are fully capable of making their own decisions would let those folks allocate their money according to their imperatives, their goals, their desires and to do so far more efficiently than any government can do. These strictly voluntary exchanges between themselves and their fellow citizens are what in their aggregate strongly boosts economies.

It’s hard to believe that the leadership of the CPC and of the PRC’s government, themselves rational adult human beings, don’t understand that.

However, freeing up the economy would let the citizenry make decisions of which these government men disapprove; freeing up the economy would lessen the personal power of these government men.

These government men are too addicted to their power; that addiction prevents them from making rational decisions, just as any drug addiction prevents the addict from making rational decisions.

Democrats, Pseudo-Science, and our Economy

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President Barack Obama stopped the Keystone XL pipeline (fortunately, it’s not permanent; a better informed President can undo this damage, but that’s for another post). Obama, supported by his Democrat confreres (though, as I said, it was his decision), offered these excuses for the stoppage:

the pipeline would create few jobs

Even taking that as accurate (thousands of jobs are not “few,” though), job creation in our present economy is not a thing to be dismissed as casually as this. Further, the John Kerry State Department’s analysis that the jobs created would amount to fewer than 0.1% of “the nation’s total employment” is fatuous on its face: other than Big Government, there are vanishingly few enterprises that don’t employ fewer than 0.1% of our nation’s total employment.

would fail to lower gasoline prices

Not initially, perhaps, as the current relative slowness of gasoline prices to fall in line with falling oil prices. However, the increased supply of oil and its associated easier delivery to refineries, can only increase the supply of gasoline relative to demand, and so the pipeline would, ultimately reduce the price of gasoline. Of course there are two sources of reduced prices, only one of which is easily visible. One is an absolute drop in price at the pump. The other, though, is easily ignored by Democrats: that’s the smaller rise in price as demand continues to outrun supply, even as that latter gap shrinks from the pipeline’s influence on supply.

exacerbate[e] climate change

Umm, no. Even were man a serious player in climate warming (this was the climatista panic-mongers’ claim; they don’t get to run away from it with a name change), the pipeline’s influence can’t be seen in the noise, given the PRC’s and India’s contribution to climate warming. However, the pseudo-science of “climate warming” is being more and more debunked—not only through exposure of all the falsified data and failed models, but with actual real data contradicting pseudo-scientists’ claims. There’s nothing present for the pipeline to influence, even minisculy.

No, canceling Keystone is nothing more than a continuation of Democrats’ pushing their crony green capitalists’ welfare, a functional if not purely intentional attack on our economy.