Tag Archives: regulation

Free Speech and the UN

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There is a carefully sub rosa international attack on free speech in progress, and unless our government takes a more active role than it has been, that attack is going to have very serious negative repercussions right here at home.  Gordon Crovitz described this in a recent Wall Street Journal op-ed.

The UN’s International Telecommunications Union is hosting a World Conference on International Telecommunications this December, which will be attended by all 193 of the UN member nations, including the US.  This meeting has been utterly devoid of publicity, and any knowledge we have about the agenda and goals have come to us only through leaks.  But here’s what we know, according to Crovitz.

A 200+ page “planning document” indicates the UN’s goals for the conference, and Eli Dourado, a George Mason University researcher, summarized the document’s contents thusly:

These proposals show that many ITU member states want to use international agreements to regulate the Internet by crowding out bottom-up institutions, imposing charges for international communication, and controlling the content that consumers can access online.

The proposals include the following:

  • give countries authority over “the information and communication infrastructure within their state”
  • require that online companies “operating in their territory” use the Internet “in a rational way”

Since these proposals come from the People’s Republic of China, this means government authorities and government definitions of “rational way.”

Other proposals would actually let the UN regulate Internet content:

  • “protect” against computer malware or spam
  • inspect private communications
  • measure Internet traffic along national borders and bill the originator of the traffic
  • give the UN authority over allocating Internet addresses, replacing ICANN, the self-regulating body that presently ensures the stability of the Internet

These proposals come from Russia and Iran; although amazingly, Europe supports the billing drive (perhaps not so amazingly considering the penchant for government controls that EU member nations have).

So far, our government’s reaction to this assault on free speech—and on American free speech—has been…muted.  The best the Obama administration has been able to do is to mumble about

“unnecessary and beyond the appropriate scope” of UN regulation

and

the text [of the planning document] suggests that the ITU has a role in content-related issues.  We do not believe it does.

This is a far cry from the bolder response we took took when the UN’s UNESCO became too ideological and not enough concerned with science and education: we cut off funding to the organization.

This administration needs to become a whole lot more forceful in opposing this attempt to grab the Internet and to use that control to stifle free speech.

Progressives, Unions, and Taxpayers

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James Sherk and Todd Zywicki described, in a recent Wall Street Journal op-ed, a rather shocking and blatant sweetheart deal between this administration’s Progressives and the United Auto Workers, at the expense of two car companies’ other unsecured creditors and us taxpayers.  I’ll just summarize the numbers; RTWT.

The UAW were unsecured creditors of GM and Chrysler via the UAW’s Voluntary Employee Beneficiary Association: the two companies owed VEBA $20.6 billion and $8 billion, respectively, stemming from why VEBA was created—to transfer to the union responsibility for its pension fund.  Other unsecured creditors also were owed some $29 billion by these two companies.  Under bankruptcy law, these two sets of creditors would have received equal shares of the bankrupts’ assets in situations where the assets were insufficient to make everyone whole.  But under the Obama bailout, the UAW’s VEBA got 17.5% of the new GM and $9 billion in preferred stock and debt obligations, while the other creditors got 10% of the new GM and warrants to purchase 15% more in preferred stock.  At today’s stock prices, that’s over $12 billion more than the other creditors got.  With Chrysler, the imbalance was even greater: Chrysler’s non-union unsecured creditors were completely shut out—they got nada while the union got half the company and billions of dollars in a 9% promissory note.  So much for equal treatment.

It gets “better.”  Bankruptcy law allows bankrupts to improve their post-bankruptcy competitiveness by renegotiating union contracts to competitive rates.  The Obama bailout didn’t allow this.  New hires will come in, for now, at reduced wages, but the existing union employees retain their old highest-in-the-industry wages—higher by $9 an hour than their nearest competitor.

One outcome of this sweetheart deal is that, together with a little understood decision by GM to throw $1 billion at another company’s (Delphi) pension obligations, Sherk and Zywicki estimate the bailout cost was

increased…by $26.5 billion.

and

The Treasury expects the auto bailout to ultimately cost taxpayers $23 billion.  The funds diverted to the UAW account for the taxpayers’ entire net loss.

Hmm….

Regulations and Foreign Law

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The Fed wants to put our own banking system under the aegis of international banking regulators.  Not directly, but by requiring all American banks—including even our smallest institutions—to meet the capital requirements of Basel III.  Basel III is an international standards “agreement” carrying international bureaucrats’ view of what constitutes a bank’s capital adequacy; those bureaucrats’ view of proper stress testing of a bank; and those bureaucrats’ view of the adequacy of a bank’s liquidity, apart from its capital adequacy.

There’s more: the Fed intends to impose on each bank a 1%-2.5% surcharge on its (increased) capital—because the Fed has a better understanding of how the bank’s capital should be used than does the bank.

Aside from whether US businesses should be under the control of foreign quasi-governmental agencies—a meme this administration is increasingly embracing—smaller financial institutions will have trouble meeting the additional requirements.  This is apparent from the results, in market share and profit margin, of this sort of intervention.  Lenders with $1 billion or less in assets have seen their market share fall to the neighborhood of 10% from the 31% they held in the early ’90s, and smaller banks had a return on assets of 1.22% for the first quarter of this year, compared with 1.52% for those with more than $1 billion in assets, just from the existence of the Fed’s domestic regulatory requirements.  So much for too big to fail.  The Fed is busily instituting too small to survive.  (And as an aside, notice those profit margins.  So much for fat cat bankers.  Those are the margins of chain grocery stores.)

There’s yet more.  The Fed doesn’t want banks to rate their riskiness in any effective way.  It intends to  force banks to stop relying on credit ratings when looking at their own assets’ riskiness.  Instead, the risk classifications of another foreign entity, Organization for Economic Cooperation and Development, are to be used.  The OECD Knows Better.

Hmm….

Coal and CO2

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We get over half our national electricity supply from coal.  Nevertheless, President Obama is intent on shutting down our coal-based electricity through his EPA regulations.  This has been commented on by lots of folks.

The Obama fantasy driving this is that by killing off the US’ capacity to use coal in energy production, he’ll put a serious dent in the production of CO2.

Never mind that CO2 is not a harbinger of disastrous warming (its atmospheric warming capacity is quite trivial, especially compared to, oh, say, methane, or to the atmospheric cooling capacity of water vapor through its reflection of sunlight back into space), but a confirmation of the health of the planet.  The record, for instance, from ice cores as widely disparately collected as Greenland and Antarctica demonstrate that atmospheric CO2 increases lag global warming, not precede it.  And of course the increases would lag.  The planet warms, as from a major Ice Age, or the Maunder Minimum, or…, and life flourishes.  That life exhales carbon dioxide, and as the life spreads in the warming climes, CO2 in the atmosphere increases.

But nor the Obama administration nor the pseudo-scientists of the Global Warming Funding Project want to talk about that.  Except the latter, to change their group name to the Climate Change Funding Project.

Some Government Health Mandate Fallout

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President Obama  insists, in response to religious organizations’ concerns, that the costs of birth control coverage can simply be shifted to insurance companies for those organizations with religious objections. This, though, simply demonstrates Obama’s cynicism.  The costs are far more than those of mere money.  The costs are moral, and shifting pecuniary costs to others (itself an egregious immorality) has no impact on this.

Some organizations recognize this moral cynicism and are demonstrating the courage of their convictions.  Vice President of Advancement at Franciscan University in Steubensville, OH, Mike Hernon told Fox News

We couldn’t believe the price (increase).  We had [their insurance company] go back and reconfirm it.  They said it was dictated by coverage limits that were released by the Obama administration.

The university had been excluding contraceptive services and related medications from its health insurance programs for its students.  The price increase that so shocked Hernon was a tripling: from $600 per year per student to $1200 for the fall semester and to $1800 the following year.  A large part of this increase was driven by the Patient Protection and Affordable Care Act’s mandate that the coverage available be increased to $100,000 for the students—for coverages that students don’t need.

As a result of the cost and of the moral violation the PPACA mandates demand, Franciscan University will be dropping its student health insurance coverage altogether.  This school cannot take part in a plan that

requires us to violate the consistent teachings of the Catholic Church on the sacredness of human life.

Hernon added that

This is putting people in a position where they are having to choose between their faith and their morality, and now an unjust cost.  These sorts of regulations from the government are forcing our hand in a way that’s really wrong. … At the end of the day, it’s the students who are hurt by this[.]

Franciscan University’s complete statement on the matter can be found here.

They’re not alone.  Ava Maria University, a private university in Florida is considering taking the same step for the same reasons.  University President James Towey says

My own sense is, I don’t see…how it makes sense for us to stay in this.

Towey noted that Ava Maria is looking at a cost increase of 65% – 85% from their current insurer.  He tried shopping the coverage, but other major insurers “wouldn’t even give us a quote.”

Do it my way, insists Obama.  Your moral objections don’t matter.  And never mind the cost, just pony up.  But this just demonstrates the failures: Obama not only is terrified of a free market in goods and services—dependency on government isn’t needed in such an economy.  But he’s also terrified of a free market in ideas.

Update: On Monday, Ave Maria University decided to go through with discontinuing its student health insurance plan.  University President James Towey said in a written statement

It is a sad day when Ave Maria’s students are forced to choose between enrolling in a health insurance plan that is both costly and offers morally objectionable benefits, and having no coverage at all.