Tag Archives: spending

A Trade War

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Russia has announced that it won’t buy certain goods from certain of the nations that are sanctioning Russia over its invasion of Ukraine and its fomenting of rebellion in eastern Ukraine. This is a trade war that Russia shouldn’t be expected to win.

For one thing, Russia’s economy is the size of Italy’s and more moribund, so any trade war can only hurt Russia relatively more than it can hurt the far larger economies of the US, the EU, Australia, Canada, even Norway, who are the targets of the Russian boycott.

For another thing, here are some facts related to this boycott.

[Russia has] banned imports of meat, fish, milk and milk products, and fruit and vegetables….  The ban has been introduced for one year

[Russia] may also introduce restrictions regarding imports of planes, navy vessels, and cars…

And

Russia depends heavily on imported foodstuffs—most of it from the West—particularly in the largest and most prosperous cities such as Moscow, where imported food fills an estimated 60-70% of the market. Food and agricultural imports from the US amounted to $1.3 billion last year, according to the US Department of Agriculture, and in 2013 the EU’s agricultural exports to Russia totaled €11.8 billion ($15.8 billion). [This is against GDPs of $17.3 trillion and €13.1 trillion for the US and the EU and ₱75.8 trillion ($2.1 trillion) for Russia.]

A year, though, is plenty of time for the banned sellers to find new markets, which reduces the long-term need to sell to Russia at all. This, in turn, produces a capacity functionally to embargo Russia with respect to those goods—not by explicitly and legally refusing to sell to Russia, but by voluntarily and economically selling elsewhere instead.

A year also is plenty of time for Russia to find other sellers: Latin America, Turkey, other ex-Soviet nations, and so on. Russians won’t starve. However, the reason these other sources aren’t current suppliers is because the boycotted nations can sell into Russia at lower prices than those alternatives. These alternative sellers will, almost necessarily then, cause higher prices in Russian stores.

Funding Israel’s Enemies

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Last week, Hamas terrorists butchered three Israeli teenagers—one of them holding dual citizenship: he was an American, too. Shortly after, a Palestinian was butchered in an act of claimed vengeance. The Israelis promptly tracked down and arrested six suspects in the Palestinian’s murder. Hamas celebrated the butchery of the three Israelis (and American) and have pressed their terrorism with a continuing barrage of rocket attacks into Israel, ostensibly to “punish” Israel for its impertinence in objecting to the murders and, more so, for Israel’s rudeness in existing.

The Obama administration has pushed both the Israelis and Palestinians to “show restraint,” as though President Barack Obama seriously believes there is a moral equivalence between the two acts and between the two societies. Indeed, Obama wrote in his op-ed for Haaretz

[I]n President Abbas, Israel has a counterpart committed to a two-state solution and security cooperation with Israel.

We’re seeing now the Hamas Palestinian Authority leader’s view of “security” cooperation with Israel.

Yet, the moral equivalence which Obama insists exists between a democratic Israel—a democracy that includes its Arab citizens—and the terrorist organization that the Palestinian Authority has become since its integration with Hamas acts to justify $400 million in annual aid, first to the PA, and now to Hamas.

Whether it’s the intent or not, the effect is that this continued aid funds a terrorist gang whose primary goal is the destruction of Israel. And Obama knows this.

YGTBSM

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Wasting taxpayer money edition. This one is from Watchdog.org.

Take careful steps.

When possible, stay in your seat and, by all means, grab hold of that railing.

Simple advice, apparently from much simpler times.

Today, Hawaii seems compelled to pay someone—rather handsomely—to offer such ubiquitous and common-sense advice.

Of course, common sense and government oftentimes are mutually exclusive.

Hawaii taxpayers will spend $81,000 in 2015 on a new government position—fall prevention coordinator, who will teach Hawaii’s senior citizens, well, how not to fall.

Governor Neil Abercrombie (D) signed House Bill 2053 into law this week, which creates the new fall prevention and early detection coordinator position within the Department of Health’s Emergency Medical Services and Injury Prevention branch.

Because the good folks in Hawaii don’t have their own uses for that money, but Hawaii’s Big Brother does.

Contradictions of the Export-Import Bank

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The Export-Import Bank is a hoary, old financial institution with the purpose of facilitating American exports by providing financing or guaranteeing loans for cross-border transactions in which the private sector declines to participate.

There’s a hint there.

It may be that such government involvement might have done some good in the bad, old days before widespread free trade agreements. It may be, too, that tariffs were a good idea a long time ago. Or maybe not.

Free trade agreements signed since those days have facilitated lower prices, more freely moving “factors”—economist-speak for the goods that companies take in and process into goods that they then sell—and more freely moving labor.

Free trade agreements, in this way, have resulted in a broader range of goods for American consumers and American companies and have produced them at lower prices than heretofore.

The hint is this: if no one in the private sector wants a part of a deal, it’s likely to be a waste of taxpayer money for the Ex-Im Bank to get involved.

Some supporters of the function of an Ex-Im, if not of the bank itself, mention as William Galston did in a recent Wall Street Journal op-ed that

Ex-Im supported the exports of more than 3,400 small businesses that probably could not have obtained commercial financing, for reasons unrelated to the creditworthiness of the prospective borrowers or to the quality of their proposed transactions.

There is, however, nothing stopping those small businesses from forming their own private-enterprise association to support each other with such needed financing.

Galston cited other supporters who see the aircraft industry as an industry desperately needing the Ex-Im Bank [emphasis added].

[T]he manufacture and sale of commercial aircraft is far from a free market. Boeing’s major competitor—Airbus—receives massive export subsidies from a European consortium. In the best case, Europe and the US would negotiate the mutual elimination of subsidies. But until that happens, say Ex-Im’s supporters, it would be self-destructive for the US to stand down unilaterally.

These supporters, apparently, think this is another area where the US should lead from behind.

No, let the Ex-Im’s authorization expire, say I.

Wasted Money and the VA

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Only this time, it’s not the VA’s fault.

Veterans Administration hospitals have spent at least $420 million on solar panels and windmills while vets wait months—or even lay dying—to see a doctor.

In total, VA hospitals reported 23 deaths due to 76 instances of delayed care, an April 2014 VA fact sheet said. Then on June 5, Acting Veteran Affairs Secretary Sloan Gibson revealed that at least 18 Phoenix patients died while waiting for treatment on a secret list kept off the books. It is not clear if that number is in addition to the 23 deaths reported earlier.

In truth, though, this failure, appalling as it is, isn’t the VA’s fault. This failure relates to the color of money: money appropriated for this purpose (physical plant improvements, for instance) cannot be redirected for that purpose (an HR move toward increasing numbers and availability of medical personnel, say) by the VA (in this case); such a redirection requires a change to the specific budget law that appropriated the two sets of funds.

The fault here lies in the misallocation of those $420 million—and that’s in the hands, ultimately, of Congress (both parties’ worth), even if “informed” by “environmentalists” and the VA management who assembled the original budget request.