Tag Archives: regulation

You Can’t Build This, Either

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Paul H Rubin, Professor of Economics at Emory University, had some thoughts on President Obama’s “You didn’t build that” oratory.  After giving Obama the benefit of the doubt and allowing that he really meant, without denigrating the accomplishments of entrepreneurs and other businessmen, that government needed to help private enterprise with infrastructure, Professor Rubin added a few items of interest in the infrastructure milieu.

  • the Obama administration, in its first three years, adopted 106 major regulations that cost over $100 million, compared with 28 such regulations in the Bush the Younger administration, and it has 144 more in the pipeline.

Of more immediate impact, with regard to the infrastructure of roads and bridges, the administration’s attitude toward other necessary components of our transportation infrastructure is clear.  It has

  • refused to allow a private company to build the Keystone XL pipeline
  • reduced permits for offshore drilling
  • slow-walked permits for drilling on Federal land
  • increased EPA regulation of pollutants, well past the point of diminishing returns, yet
  • committed to spend billions on California’s riderless bullet train to nowhere

Concerning another area of necessary infrastructure, access to capital, there’re these:

  • regulations needed to implement Dodd–Frank are not even being written, negatively impacting business’ ability to reasonably predict their fiscal future—so some won’t lend, and others won’t borrow.
  • increased minimum wage discourages hiring entry-level workers, or older workers into low-value jobs
  • Obamacare increases uncertainty regarding future labor health-related costs

And so on.  RTWT.

An Influence on Bank Lending

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Professor Alan Blinder, of Princeton University, has another laugher in The Wall Street Journal.  This time he wants the Fed to “encourage” private bank lending—in an environment where the intended market is vary chary of taking on debt, new or additional—but without “without interfering in private credit-allocation decisions.”

His idea is stimulated by a scheme (in both the British and American English senses) of the Bank of England’s, itself generated out of the premise that UK banks aren’t lending enough to suit the government suits.  Essentially, Blinder wants to ape the BoE scheme of giving private lenders preferential rates on central bank lending according to how much lending the private lenders are doing.

Hmm….

First, Blinder operates from a false premise.  It’s impossible for government to “encourage” without “interfering in private decisions.”  The whole point of government encouragement to execute exactly that interference.  To claim that compliance is voluntary and so not interference is disingenuous sophistry.  Banks are out to make money for their owners, just as any business must—its fiduciary duty drives it to—make money for its owners.  The offer of a goodie for doing what government wants is no less a cudgel than providing a penalty for not doing.

Second, Blinder gives his game away in the penultimate paragraph of his piece:

Last, but certainly not least, there is the crucial question of what types of bank lending to subsidize.

Of course, the sole purpose of a subsidy is to drive the recipient to a government-desired behavior.  The whole point of government encouragement to execute exactly that interference.

Some Thoughts on Climate

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There seems to be a problem with the location of the surface stations that are used to assess  (global) temperatures across a wide geographic area and over long periods (as “climatologists” see it) of time.  In particular, the US Historical Climatology Network, which has major contributions to the data sets used by “climatologists,” seems to have been giving invalid readings for quite a number of years, and at least one US agency involved in driving Federal climate policy seems to have badly “adjusted” the data these stations have been doing a bad job of providing. 

Specifically, as Anthony Watts, the lead author of the paper that investigates the implications of this error (“An area and distance weighted analysis of the impacts of station exposure on the U.S. Historical Climatology Network temperatures and temperature trends”), put it in an earlier paper,

[A]pproximately 90% of USHCN stations were compromised by encroachment of urbanity in the form of heat sinks and sources, such as concrete, asphalt, air conditioning system heat exchangers, roadways, airport tarmac, and other issues.

This is the result of the well-known urban heat island effect.  The cities grew out to surround the originally placed sensors, and nothing was done about those sitings.

In Watts’ present paper (that inspirationally titled “area and distance weighted analysis” paper), Watts used a better method of assessing the quality of the station locations, one developed by Michel Leroy of METEO-France and accepted for use by the World Meteorological Organization.

Watts’ findings:

…a spurious doubling of U.S. mean temperature trends in the 30 year data period covered by the study from 1979 – 2008.

Moreover,

Poorly sited station trends are adjusted sharply upward, and well sited stations are adjusted upward to match the already-adjusted poor stations.

Well sited rural stations show a warming nearly three times greater after NOAA adjustment is applied.

Urban sites warm more rapidly than semi-urban sites, which in turn warm more rapidly than rural sites.

And finally:

The new analysis demonstrates that reported 1979-2008 U.S. temperature trends are spuriously doubled, with 92% of that over-estimation resulting from erroneous NOAA adjustments of well-sited stations upward.

Hmm….

Federal Arrogance

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Jennifer Valentino-Devries reported on a case involving the recently expanded US Patriot Act in a recent Wall Street Journal.  In this case, an unnamed telecom company, a recipient of an FBI National Security Letter, is objecting to the letter and the demands in it, which are, in essence, to turn over to the FBI whatever the latter demanded, based on…well, because FBI inquiring minds want to know.

The Patriot Act has a lot of good things in it, but it grants a dangerous level of power to the government, also.  NSLs, for instance, don’t require a judge’s prior approval, as a search warrant does.  In fact, the company’s representative who physically receives the NSL is “legally” barred from even acknowledging the letter’s existence except to company lawyers.  The FBI’s secret demand is good enough; we’re to take their word for it.  Here, just to confirm the danger of such star chamber power, the FBI’s response to the telecom’s protest was to instruct its victim to sit down, shut up, and deliver the goods.  Or else.

The US Department of Justice fired back with a serious accusation. It filed a civil complaint claiming that the company, by not handing over its files, was interfering “with the United States’ sovereign interests” in national security.

As far as I’m concerned, this is grounds for dismissing the Government’s claim and its letter with prejudice.  It is never out of order to defend one’s rights.

Leaving that aside, though—the FBI’s case, nor its NSL, have not been dismissed out of hand—the opposing positions are starkly apposite:

[T]he company is arguing, among other things, that the gag orders associated with most of these letters improperly restrain speech without a judge’s authorization.

On the other hand,

The FBI says it must maintain the secrecy of national security letters to avoid tipping off potential terrorists.

This gives the game away.  DoJ has said in its filings

The object of the nondisclosure provision is not to censor private speech[.]

This is just a cynical red herring: the 1st Amendment isn’t there to protect private speech.  It’s there to protect public, political speech.

Finally, Stephen Vladeck, a professor at American University Washington College of Law and an expert on terrorism law says about this case

It raises a question Congress has been trying to answer: How do you protect the First Amendment rights of an NSL recipient at the same time as you protect the government’s interest in secrecy?

The 1st Amendment rights to free speech and to petition the Government for a redress of grievances are specifically intended to allow the sovereign people, individually or collectively, to rein in an overreaching government.  The government’s interest in secrecy plainly is subordinate to those sovereign rights—which it is the government’s duty to defend, not its duty to attack those who insist on them.

Motives Followup

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I wrote about motives a bit ago.  Here’s a followup on that.  From Fox News comes two items of interest.

First, the Department of Agriculture has been even more actively pushing its food stamps onto the non-needy than I had earlier written.  The Obama administration is trying harder and harder to pull Americans into government dependency, this time with a series of advertisements—paid for with your tax dollars—aimed at getting even those who don’t need food stamps to avail themselves of the “benefit.”  These advertisements are in the form of a 10-part miniseries called “Hope Park.”

The target of these vignettes is Diana, whose husband works (!) and who doesn’t think she needs the food stamps, as she notes in the 4th vignette:

I don’t need help from anyone.  My husband makes enough to take care of us.

By the last episode, though, Diana has been hooked, and she’s singing the praises of the stamps she didn’t need—but now needs badly.

As Senator Jeff Sessions (R, AL) describes this program,

It has become increasingly clear that, in recent years, the mission of the food stamp program has been converted from targeted assistance for those in need into an aggressive drive to expand enrollment regardless of need. … Read as a whole, USDA’s activities suggest that the program administrators take personal offense when people who technically qualify for their largesse decline to accept—and see it as an obstacle to overcome.

The other item of interest is this.

The Department of Health and Human Services has chosen to waive the work requirement that is part of the eligibility requirement for the Federal Temporary Assistance for Needy Families program, and it carefully has done so without fanfare.  The directive through which HHS does this can be read here, and a copy can be read here.

Governor and Republican Presidential Candidate (presumably) Mitt Romney correctly noted

[T]he linkage of work and welfare is essential to prevent welfare from becoming a way of life.

But as Congressman Jim Jordan (R, OH) said,

President Obama just tore up a basic foundation of the welfare contract….

It’s true enough that the directive insists that

Waiver requests must include an evaluation plan.  …the preferred evaluation approach is a random assignment methodology, unless the Secretary determines that an alternative approach is more appropriate….

and

The Secretary will not approve a waiver for an initiative that appears substantially likely to reduce access to assistance or employment for needy families.

But notice carefully.  What constitutes adequate evaluation by the states is carefully left unspecified, except that if HHS Secretary Kathleen Sebelius decides she doesn’t like a state’s evaluation methodology, she’s free to substitute her own, whose criteria also are carefully left unspecified.  Moreover, “substantially unlikely” to reduce access also is left to the unspecified whims of the Secretary.

There’s more in that last phrase, too.  “[A]ppears substantially likely to reduce access to assistance or employment” clearly means that access to assistance is to be maintained independently of access to employment.  The directive doesn’t require access to assistance and employment.

Without a work requirement as an eligibility criterion for TANF assistance, though, there is only eligibility for TANF dependency.

Again, I ask: what are we to make of the motives of government officials who do these things while knowing full well the outcomes of their actions?