Tag Archives: regulation

The Judicial Branch and the Law

Posted on by
Reply

In a couple of weeks, the Supreme Court will hear a case involving Federal subsidies to health coverage purchasers who bought their plans on ObamaMart instead of State exchanges. The Obamacare law limits those subsidies to purchasers via State exchanges argue the plaintiffs; the government demurs.

Some ACA critics fear the Supreme Court may hesitate to block the current subsidies because of a lack of confidence in the legislative branch in general.

Against that backdrop, Supreme Court Justice Ruth Bader Ginsburg has said

The current Congress is not equipped really to do anything[.]

That claim is the pseudo-logic President Barack Obama uses to justify his Executive Orders and “executive actions” that deliberately bypass Congress, and unconstitutionally so.

Justice Ginsburg, and others of like mind on the Supreme Court, may be entirely right on Congress’ ability—or willingness—to act. However, she, and they, would do well to remember that the Constitution they’re sworn to uphold does not authorize the Court to legislate in place of, or in addition to, Congress.

Justice Ginsburg and her fellows would do well to remember that the judiciary’s task is first to determine whether a law comports with the Constitution as the Constitution is written, and if it’s legitimate, to apply that law as that law is written.

Full stop.

Democrats and Those Pesky Laws

Posted on by
Reply

Three senior House members told The Associated Press that they plan to strongly urge the administration to grant a special sign-up opportunity for uninsured taxpayers who will be facing fines under the law for the first time this year.

The three are Michigan’s Sander Levin, the ranking Democrat on the Ways and Means Committee, and Democratic Reps. Jim McDermott of Washington, and Lloyd Doggett of Texas. All worked to help steer Obama’s law through rancorous congressional debates from 2009-2010.

Because, voters. Because, law? That’s too inconvenient; just ignore it.

The Obamacare law—which Democrats have been trying to stifle debate about by insisting “It’s the law of the land”—specified the signup period. If these worthies want to change the signup period, they need to change the law—which they helped write this way—not ignore it.

The lawmakers say they are concerned that many of their constituents will find out about the penalties after it’s already too late for them to sign up for coverage, since open enrollment ended Sunday.

Wait, what? These Democrats haven’t been talking to their constituents about their responsibilities under these Democrats’ law? Not since 2010? At all!?

Oh, yeah. Voters.

A Fatal Flaw

Posted on by
Reply

In a piece for Wired, FCC MFWIC Tom Wheeler offered rationalization for his decision to dismantle the Internet. He opened his apologia with this remarkable claim:

This proposal is rooted in long-standing regulatory principles….

That’s the problem. Regulatory “principles” proceed from the assumption that government regulation is a universal and primary good.

Of course, that’s precisely backward—and backwards. A free market is almost universally self-regulating: make a bad product, people find out and stop buying—the producer goes out of business. Lie about a product, people find out and stop buying—even if the product itself might be sound—and the producer or seller goes out of business. And so on.

Almost universally: yes, there are conditions within which government regulation is warranted. But such regulation must proceed from the fundamental assumption that regulating is bad or unnecessary, and the regulation proposer must prove—not merely justify—why this proposed regulation is necessary (not merely useful in some sense).

Wheeler’s regulatory travesty must be halted. Even its mere suggestion is sound reason for Congress to act—perhaps unsuccessfully until 2017 with a Republican President, too—now to reign in, to severely circumscribe, the regulatory authority of all Departments and Agencies.

Academic Apostasy

Posted on by
Reply

What are our post-high school academic institutions coming to?

Dartmouth Dean of the Faculty of Arts and Sciences Mike Mastanduno said this:

More than I’d like to, I hear this: “It’s really hard to teach on Thursday morning because of what the students do on Wednesday night.” I hear that from faculty. What I never hear, and what I’d love to start hearing from students is, “It’s really hard to do what we want to do on Wednesday night because of what’s expected of us on Thursday morning.”

Dude—party, man. It’s what we’re here for.

Maybe things might change a little, though. Dartmouth President Phil Hanlon is looking to make changes.

He wants to reorganize the dormitory system into “house communities” in which students will tend to reside for their college career instead of moving around frequently. Shockingly, they will

have dedicated space for study and social interaction….

Say, what!? Dude, chill.

But wait—there’s more:

I am asking the faculty to consider a number of ways to increase the rigor of our curriculum—from curbing grade inflation, limiting lay ups, to not cancelling classes around celebration weekends, to earlier start times for classes on Tuesday and Thursday mornings.

Dude, hold up—don’t listen to that Dean….

 

Dude….

NYSE Auctions

Posted on by
Reply

In the bad old days of stock auction markets [sic], owners of shares of companies—companies nominally public by their status as a shareholder company—would meet in a crowd, face to face, and offer their shares for sale at a price or offer to buy another’s shares at a price. Bid prices and asking prices would converge, and sales would be executed.

Only the rich could play this game, though; Middle America (and Middle Netherlands where such auctions got an early start some hundreds of years ago, and Middle You-Pick-the-Nation) couldn’t afford to play. To be sure, Middle America (and the others) in those early days had little interest in playing, and the matter was a no harm, no foul situation. Then the broker industry developed, and brokers would act as middle men in these auctions, doing the mixing and matching of buys and sells—for a small remuneration, of course—and the shareholders didn’t need to meet in person. But those remunerations—commissions—kept Middle America priced out of the game.

Then discount brokers developed (think Charles Schwab), and Middle America (and Middle xyz) could play. The broader breadth of participation both increased stock prices themselves, and they gave companies all across the economy access to tons of additional money, from us little people, with which to do R&D, sales, production, etc. After all, little peoples’ nickels and dimes add up—it’s how the earlier Five and Dime stores prospered and how today’s deep discount stores prosper. It also gave us little people additional ways to save and to build our nest eggs.

Today, there are even brokerages that operate entirely online, for a song: typical remunerations for effecting a buy or sell today range from $5 to $10 per some number of thousands of shares traded (when Schwab was starting out, they charged $35 per hundred shares traded).

Now the New York Stock Exchange wants to

introduce a midday auction

ostensibly to

draw trading away from private venues such as dark pools….

Never mind that those dark pools are capitalist, free market responses to excessive interference in today’s financial industry (of which stock markets are only a part) by the Security & Exchange Commission and the myriad mechanisms spawned by Dodd-Frank.

The new NYSE auction would take place in the middle of the day, when trading is at its slowest. One draw of such auctions is they allow big investors to put in large orders without immediately moving the price of a stock[.]

Auctions work differently than continuous trading on markets, which match orders as they come in at an ultrafast pace. In an auction, buyers put in a maximum price and quantity they are seeking to fill and sellers put in a minimum price and size they are willing to sell over a period of time. At the end of the period, orders are filled at a price set by supply and demand for shares.

Just like those original bad, old days.

I’m not sure this isn’t a return to those bad old days when only the rich could play. I’m not sure it is, either; it’s something that needs to be watched very carefully—even by the SEC.