Tag Archives: political economy

Catch-22?

Posted on by
Reply

No, typical Leftist “misunderstanding.”

In a piece about the possibility of an inflation-related increase in Social Security payments, Megan Henney, writing for FOXBusiness, cited this remark from Mary Johnson, The Senior Citizens League‘s Policy Analyst/Editor, about the supposed downside of the increase.

Higher Social Security payments are a bit of a Catch-22. They can reduce eligibility for low-income safety net programs, like food stamps….

That demonstrates a complete misunderstanding of safety net programs. With greater income, there’s less need for the safety net, so of course eligibility should be reduced commensurately.

Only a Leftist, who believes in ever-growing government, could say such a thing with a straight face.

Power to the People

Posted on by
Reply

Or not.

In a Friday op-ed centered on California’s hog-raising requirements for pork sold in the State, Robert Alt, President and CEO of the Buckeye Institute had this throw-away line:

California—which boasts of recent policies that require residents to reduce electricity use to prevent rolling blackouts….

The only State—and possibly the first nation in the world—to institutionalize steady state brownouts.

What a legacy for the Progressive-Democratic Party running California.

Rent Control Fails Again

Posted on by
Reply

And so does the St Paul, MN, city council, sort of.

Last November, the city’s voters passed a rent control law that caps annual rent increases at 3%. Then reality intruded, and the City Council was forced to attempt corrective actions.

The City Council noted in its reform bill that, “according to data from the Department of Housing and Urban Development, there have been only two hundred (200) residential building permits in Saint Paul through April of 2022, compared to 1,391 at the same point in 2021.”

That drop occurred as immediately as any economic reality can—beginning just two months after the cap was passed.

The City Council’s corrective actions are limited to

  • a 20-year rent-control exemption for new residential properties and some apartments that participate in government affordable-housing programs
  • after a tenant leaves or is evicted with just cause, landlords will be able to raise rent by 8% plus inflation
  • property owners can…apply to St Paul for an exemption to the 3% rent cap if their property taxes go up or if there are “unavoidable increases” in maintenance and operating costs, including increases owing to inflation

In truth, this may be all the City Council can do to…modify…the will of the city’s residents. To get serious correction to this rent control fiasco, the question really needs to be resubmitted to those residents.

If those voters reaffirm their position on rent control, we’ll all know what those worthies truly think about housing and access to it by those in the lower economic tiers of the city.

Truss’ Tax Cut “Fiasco”

Posted on by
Reply

UK Prime Minister Liz Truss withdrew her plan to reduce the Brits’ top tax bracket from 45% on annual incomes above £150,000 (roughly $169,000) to 40% amid a panicky self-serving outcry from the liberal Labourites and too many entrenched pseudo-conservatives among the Tories. The rest of her tax reduction and energy subsidy package seems to remain intact.

In the scheme of things politics, though, it seems to me that withdrawing that top tier tax cut is a small price to pay in order to get the rest of the tax cuts to pass. And it may be (though I frankly doubt it) that Truss deliberately overbid her tax cut package in order to allow herself be talked down a little bit to get to a package that could pass after her concession but that could not pass had she made her bid from the jump without the cut from 45%.

Regardless, the biggest error, and one that no one in Socialist Great Britain is decrying, is that enormous energy subsidy to businesses and households, ostensibly to help them pay for skyrocketing energy costs. Sure, the subsidy is supposed to be sunsetted after two years, but most of us know how well sunsetting works with subsidies.

Instead, the subsidies will serve only to maintain the current sky high energy prices to the end users and to consumers in all economic strata, all of whom must buy food, and housing, and transportation—all of which depend on energy.

The smarter way to reduce those energy costs would have been to push further deregulation of British domestic fossil fuel energy production and delivery. Truss is moving to allow fracking to resume, but that’s only a start.

Another Reason…

Posted on by
Reply

…to stop doing business with the People’s Republic of China—especially, stopping exporting American natural gas to that nation.

The Biden administration has been busily selling American, that is, domestically produced, liquified natural gas to the People’s Republic of China. LNG his administration sells there, mind you, isn’t LNG he can sell to the gas-strapped nations of Europe and Asia.

Selling energy to an enemy nation is bad enough, and it’s worse when those sales come in preference to sales of the same energy to our friends and allies.

The worst, though, is selling our energy to that enemy nation—the PRC—only to have that nation resell our energy to our friends and allies—the gas-strapped nations of Europe and Asia—at a steep profit for itself.

[PRC] companies that signed long-term contracts to buy US liquefied natural gas are selling the excess and making hundreds of millions of dollars per cargo. Buyers include Europe, Japan and South Korea.

For instance:

[The PRC]’s ENN Natural Gas Co is expected to profit from this trade when it sends the LNG tanker Diamond Gas Victoria to pick up a cargo of gas from Cheniere Energy Inc’s plant at Sabine Pass, LA, on the Gulf Coast on October 18, according to three industry sources.
Instead of dispatching the tanker to [the PRC]’s east coast, the vessel is scheduled to deliver LNG to Europe, they said. ENN is estimated to make a profit of between $110 million and $130 million on this one cargo shipment, analysts said, basing their calculations on market pricing data.

It’s true enough that the PRC’s resales to Europe and Asia are a drop in the ocean compared to those nations’ natural gas needs, but these are sales, and profits, that would be better done as a result of our directly selling our liquified natural gas to Europe and Asia, and at a lower cost, if only from cutting out the middle man. And from cutting out an enemy nation.