Tag Archives: political economy

It’s a Start

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The House, by an overwhelming bipartisan majority—424-8—passed a bill that would strip Russia and its satrap Belarus of Most Favored Nation status. The bill, if passed by the Senate and signed by President Joe Biden (or his veto overridden), would allow us to

raise tariffs on goods from Russia and Belarus and give President Biden power to impose even stricter import taxes on their exports amid the ongoing invasion of Ukraine. …
The bill also sets up strict guidelines for when the president can restore normal trade relations with Russia and Belarus based on the state of the Ukraine war.
The Biden administration will additionally be obligated to push for Russia’s removal from the World Trade Organization and oppose Belarus joining the group, which would subject both to higher tariffs and steeper trade barriers.

Eight Republicans voted against the bill; their concerns centered in part on their push to make President Joe Biden’s Executive Order barring importation of Russian oil statutory by including that in the bill.

The more we pile economic burdens onto Russia over its invasion of Ukraine and the atrocities Putin’s barbarians are perpetrating on Ukrainians, the better. However, we need to keep such moves in perspective: they’ve forced Putin to withdraw zero battalions from Ukraine, and they forced Putin to drop zero fewer bombs, rockets, or missiles on Ukrainian women, children, hospitals, schools,…. Weapons, ammunition, and medicines need to flow freely and rapidly to the Ukrainian military.

Political Disapproval of Private Enterprise Production

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The Wall Street Journal‘s editors are touting the withdrawal of Sarah Bloom Raskin from the nomination to the Federal Reserve Board’s Vice Chairman position, laying that defeat off to this:

But Ms Raskin’s most significant opponent was her oft-expressed view that the Fed and other regulators should deny credit to companies that produce or heavily consume fossil fuels.

It’s good that this one failed, but it’s just an early skirmish.

The problem is broader than this. It’s dangerous to our republican democracy that anyone would be nominated to the Fed or to any Executive Branch position who would willingly abuse that position’s authority to discriminate against any government-disapproved American enterprise.

Earmarks—Congress Has Them

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They’re back, in spades, courtesy of Congress’ latest spend-a-thon, the $1.5 trillion omnibus spending bill just rushed through under the guise of billions more dollars in aid and weapons for Ukraine. The funding for Ukraine is sorely needed, but that should have been argued and enacted through a separate, stand-alone bill. Instead, Progressive-Democrats and too many Republicans (vis., Senator Richard Shelby, R, AL) used the blood and bodies of Ukrainians to speed through their personally convenient spending wishes—earmarks.

The argument for earmarks is that Congress should direct this spending rather than leave it to the federal bureaucracy. But the bureaucracy is better placed to make trade-offs based on economic value and urgent need in a world of limited resources.

There are two failures in this claim by The Wall Street Journal‘s Editorial Board.

One is that earmarks are perfectly fine as compromise grease and tradeoffs—they just should occur from within a separate budget and allocation line item for earmarks, and each such earmark should be openly debated on the House and Senate floors so We the People can see them and approve or disapprove of them.

The other is the incredibly naive claim that bureaucracy is better placed to make trade-offs based on economic value and urgent need. No, it’s not. Bureaucrats, just like any other politicians, whether elected or Civil Servant, will make the trade-offs that best suit the bureaucrat(s) involved. On top of that, it’s Congress that controls spending, not bureaucrats. Spending decision should be left to our elected representatives in those houses; delegation needs to be reined in and severely curtailed.

Drill, Baby, Drill

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Progressive-Democrats really do not want our nation to be energy independent or to be able to support our friends and allies—and acquaintances around the world—with energy exports for the foreseeable future. For motives known only to themselves, they want to kill our energy capability until their dream of “green” energy comes to fruition, in that future distant beyond the foreseeable.

Senate Democrats are threatening to punish US oil companies with a windfall-profits tax if they increase production.

This also illustrates Progressive-Democrats’ utter disinterest in the way economics and economies work (I’m reluctant to say these Know Betters are ignorant of those ways).

The Senators plan would require companies that produce or import at least 300,000 barrels of oil per day (or did so in 2019) to pay a per-barrel tax equal to 50% of the difference between the current and average price between 2015 and 2019 (about $57 a barrel).

Since increasing supply relative to demand brings down price, one counter to this Progressive-Democrat war on our energy economy is to drill, baby, drill.

Another counter becomes available this fall—we need to fire Progressive-Democrats from our State and Federal governments so that energy producers can drill, baby, drill.

A Step

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The Securities and Exchange Commission is thinking about requiring publicly traded companies “promptly” to report data breaches and other significant cybersecurity incidents; “promptly” meaning within four days. Targeted companies, further, would be required to provide periodic updates about previous incidents and to report when a series of previously undisclosed, individually immaterial cybersecurity events has become material in the aggregate.

SEC Chairman Gary Gensler:

Cybersecurity incidents, unfortunately, happen a lot. Thus, investors increasingly seek information about cybersecurity risks, which can affect their investment decisions and returns.

Good to see Captain Sort of Obvious is more or less on top of this. There’s more to it, though, than just investment decisions.

Hacking our businesses aren’t only detrimental to the targeted companies. They’re far too often deliberate, coordinated attacks across industries, and so are threats to our national security. The attacks, even if done in isolation from each other by independently acting criminals (which is what hackers are), far too often aggregate into a threat to our national security.

Requiring reporting within four days is an improvement over the current weeks to months of delay. However, at the speed with which a hack attack can proceed through networks and across the Internet to other networks—especially with the cloud so ubiquitously in the middle—it’s necessary for the attacked business to report the fact of the attack immediately, not some convenient period of time later.

The rule should be expanded, too; although the expansion I suggest would be beyond the SEC’s ken, and so it would need to be enacted by Congress: private companies should be required to report such attacks, also, and just as promptly.