Tag Archives: political economy

GIGO

Posted on by
Reply

The Garbage Out is easily summarized: the Progressive-Democrats’ $1.9 trillion Wuhan Virus “relief” bill that the House is putting its finishing touch on and then will send to the Senate.

The garbage going in:

  • $350 billion for state and local governments, cities, and counties. Progressive-Democrats also changed the funding formula to ensure most of the dollars go to blue states that shutdown their State economies—to the detriment of neighboring States as well as to their own
  • $86 billion to bail out 185 or so multiemployer pension plans insured by the Pension Benefit Guaranty Corp. Never mind that these so-called plans have been badly underfunded since their inception by both the employers and the unions that created them
  • $129 billion for elementary and secondary schools, whether they reopen for classroom learning or not. Never mind, either, that most of the funds allocated by CARES remains unspent—or that of these new $129 billion isn’t scheduled to be spent until years later

And this garbage:

  • $50 billion for the Federal Emergency Management Agency
  • $39 billion for child care
  • $30 billion for public transit agencies
  • $19 billion in rental assistance
  • $10 billion in mortgage help
  • $4.5 billion for the Low Income Home Energy Assistance program
  • $3.5 billion for the program formerly known as food stamps
  • $1 billion for Head Start
  • $1.5 billion for Amtrak
  • $4 billion to pay off loans of “socially disadvantaged” farmers and ranchers
  • nearly $1 billion in world food assistance.

Never mind that of these $162.5 billoin, only the FEMA money might have utility. The rest of it is utterly unnecessary for anything other than vote-buying. The “needs” implied here would disappear were the States to reopen their economies and the Federal government to get out of the way so businesses could operate and Americans go back to work.

And this raw sewage:

  • $15 an hour minimum wage

Never mind the business- and job-destroying (to the tune of 1.4 million jobs) nature of such a mandate.

  • an increase to the child tax credit to $3,000 from $2,000 ($99 billion)
  • expansion of the Earned Income Tax Credit to certain additional childless adults ($25 billion)

Which wouldn’t be necessary were Government out of the way and our State and national economy reopened.

Even earmarks:

  • $1.5 million for the Seaway International Bridge connecting New York to Canada
  • nearly $500 million for, as the CBO puts it, “grants to fund activities related to the arts, humanities, libraries and museums, and Native American language preservation.”

But this is what the Progressive-Democrats are demanding. Watch Senators Joe Manchin (D, WV) and Kyrsten Sinema (D, AZ) vote these up because they’ll vote up the overall $1.9 trillion bill, along nakedly partisan reconciliation, for all their pious sermons about requiring bipartisanship on all bills.

Earmarks

Posted on by
Reply

Leave it to Progressive-Democrats to want to bring this exemplar of spendthrift back. You know what earmarks are:

“member-directed spending,” [that] are provisions discreetly tucked away in large spending vehicles that directly fund a pet project championed by a specific member of Congress for the member’s own constituents.

Congresswoman Rosa DeLauro (D, CT) and Senator Pat Leahy (D, VT)—the respective chairs of the House and Senate Appropriations committees are about to introduce legislation that would restore the business.

In contrast, Senator Ted Cruz (R, TX) and Congressman Ted Budd (R, NC) are pushing the Earmark Elimination Act, which would ban earmarks permanently. Citizens Against Government Waste President Tom Schatz told Just the News that

Earmarks are the most corrupt, costly, and inequitable practice in the history of Congress. They led to members, staff, and lobbyists being incarcerated. In a form of legalized bribery, members of Congress vote for tens or hundreds of billions of dollars in appropriations bills in return for a few million dollars in earmarks. Earmarks go to those in power, as shown during the 111th Congress, when the 81 members of the House and Senate Appropriations Committees, who constituted 15% of Congress, got 51% of the earmarks and 61% of the money. Restoring earmarks will lead to the same results.

I’m not as adamantly opposed to earmarks as some: they can be useful horsetrading tools, usable to facilitate political tradeoffs to get important legislation passed—or other useless legislation blocked.

The major problem, it seems to me, has been the secretive nature of earmarks. They tended to be negotiated behind closed doors, out of the public’s view, and then buried in one or another appropriations bill. The process needs to be better structured.

In that 111th Congress, the total amount that wound up being spent on earmarks amounted to some 3% of that session’s first year budget. Accordingly, break out those 3% into a separate appropriations bill as a sort of earmark slush fund. Then have every earmark proposal individually debated on the House and Senate floors until the 3% is committed, and where differences occur between the final House and Senate slush fund appropriations bills, let the bills be reconciled via House-Senate joint committees, just as every other bit of legislation is.

Let the horsetrading occur in plain sight of the House and Senate member constituencies. Ordinary Americans can handle the sight of sausage making. Honest.

And they’ll take appropriate action at the next election. ‘Course, that’s what the politicians are afraid of.

A Proposed Response

Posted on by
Reply

Texas State Congressman Matt Shaheen (R, Dist 66 [which includes my county]) has tweeted access to a Request for Comment regarding last week’s snow and cold storm with various utilities’ associated failures to keep supplies of electricity, natural gas, and potable water flowing in major areas of the State.

Kudos to Shaheen for publicizing this RFP.

Below are my inputs.

  1. All, without exception, ERCOT board members and senior executives (C-suite equivalents and their deputies) must reside within Texas. Half of the board members, a separate half of the C-suite, and a separate half of their deputies must reside in separate rural regions of Texas. Within that last, a C-suite executive and his deputy must not reside in the same region.
  2. Each of these board members, senior executives, and their deputies must have demonstrated expertise and empirical experience in energy and potable water supply—e., they must be energy and water engineers. Personnel with legal expertise can serve as board consultants and as assistants to the senior executives’ deputies.
  3. The State government must encourage—but not mandate—all utility providers to amortize their bills that result from the sort of event the storm of 15-19 Feb 21 represents over the succeeding 12 months. Single bills of $9,000-$17,000 (to the extent these numbers aren’t just press hype) shouldn’t occur; they should be spread over the succeeding year.
  4. Exceptionally high single-month bills like those suggested in 3) above should be investigated for their legitimacy—but from the going-in assumption that they are legitimate free-market, high demand/limited supply prices. “Price gouging” is what must be proven.
  5. All utility providers and their suppliers must winterize their systems against worst-case scenarios, with the minimum threshold being a 100-year temperature excursion, sustained for more than “a few” hours. The current winterizing was against only “bad” case scenarios. This winterizing must come solely at the expense of the individual utility, that utility’s customers, and each utility’s supplier(s). The costs should be amortizable over a reasonable period of time, and PUCT should allow the rate increases needed for cost recovery within that amortization schedule for those utilities within its jurisdiction. Other regulators must be required to do the same. The amortization schedules should be those initially proposed by the utilities/suppliers, and the regulators should be spring-loaded to accept them, rejecting a particular schedule only for concrete, measurable cause(s).
  6. Utilities with out-of-state suppliers that can’t or won’t comply with 5) above should be encouraged to find Texas-domiciled suppliers with which to replace them. Failure to find substitutes should not absolve the impacted utility of its responsibilities or liabilities related to energy/water supply so long as they are making concrete, measurable, publicly viewable ongoing efforts to find Texas-domiciled replacements. The Texas government should support the search efforts with its own research facilities, but not with taxpayer funds.
  7. Eliminate energy subsidies—both renewable and hydrocarbon

“Working Off” Student Debt

Posted on by
Reply

A letter writer in The Wall Street Journal‘s Tuesday Letters section posited an alternative to student debt: trade it for community service.

I would readily support loan forgiveness if the beneficiary were required to do community service for the forgiven debt.

Only so long as the community service work is low-skill, low-education work, with the student debt scofflaw—because that’s what he still would be—working directly under the controlling supervision of a low-skill, low-education person who’s had that job for a while.

Let the scofflaw see who he’s displacing with his preciousness and his debt-ducking.

Let him see the college student, during the school year, trying to earn some night shift money with which to pay for some college without “borrowing” money.

Let him see the high schooler trying to earn some summer job money and to obtain some initial, entry-level work experience for his future use in working his way up the employment and economic ladders.

On that last, especially, I employed a high school sophomore last summer to mow my lawn, edge it, and clean the sidewalk of the mowing and edging detritus. I ordinarily do my own yard work, but this enterprising young man, by his enterprise, earned the job. A student debt scofflaw would get this sort of work from me only if he worked under the hiring and firing authority of my high school sophomore contractor. Which would give the sophomore some valuable supervisory experience, too.

Which supervisory experience also would benefit those other low-skill, low-education workers for whom the community service debtors would be working.

Win Customers, Raise Revenue

Posted on by
Reply

That’s the Post Office’s goal. Doesn’t seem like they have a viable plan for that, though.

Postmaster General Louis DeJoy is preparing to put all first-class mail onto a single delivery track, according to two people briefed on his strategic plan for the US Postal Service, a move that would mean slower and more costly delivery for both consumers and commercial mailers.
[They plan to] eliminate a tier of first-class mail—letters, bills and other envelope-sized correspondence sent to a local address—designated for delivery in two days. Instead, all first-class mail would be lumped into the same three- to five-day window, the current benchmark for nonlocal mail.

And

The plan also prevents first-class mail from being shipped by airplane….

After all,

The Postal Service spent more than $457 million flying first-class mail in 2020, according to data it filed with the Postal Regulatory Commission, and spent $314 million transporting mail by truck.

Of course, putting all that air cargo onto trucks won’t increase truck transport cost. Uh, uh.

Oh, and the Post Office is planning to raise postage rates in order to make up for this degradation of service.

Brilliant.