“We will promote free choice by limiting free choice!”

March 28, 2011

If that doesn’t make sense to you, well, it doesn’t to me, either. It apparently makes some sort of sense to LA City Councilman Bernard Parks, however, who helped push through a ban on new fast-food businesses in two districts of south Los Angeles. Why? Well because there are too many fast-food places in that area already (in Parks’ view) and, by limiting the “overabundance,” they’ll encourage more sit-down restaurants with healthier food.

Yeah, that sounds like nanny-stater nonsense to me, too. And it did to the crew at Reason.TV, who went out and shot this short doumentary:

Parks’ logic fall apart on several grounds. First, if he wants more sit-down restaurants in those districts, then create the conditions that will encourage them to set up shop. They’re not staying away because there are too many McDonalds; they’re staying away because it’s a low-income area with a high crime rate, so the cost of business is too high for these chains. Improve the local economy, improve public safety, and you’ll find more “nice” places.

Second, what has Parks got against small business? These aren’t all McDonalds and Taco Bell. Many of the small fast-food joints are individual Mom-and-Pop small businesses that provide cheap, quick food at affordable prices to the locals. They also provide jobs for the down-on-their-luck who might not get hired by the chains. By blocking any more small fast-food businesses, Parks and the Council cut off a source of jobs for an area already suffering from at least 14% unemployment.

Finally, the nutrition angle is bunk. As the video shows, the “junk count” at chain sit-down restaurants can be as bad or worse than a fast food place. Conversely, fast-food operations like McDonalds have responded to free-market pressure and customer demand to offer healthier options. City intervention is heavy-handed, unneeded, and counterproductive.

The bottom line is that this is another case of some nannystater thinking he knows your business better than you yourself do.

With Los Angeles facing a fiscal train wreck and a sour economy, perhaps Councilman Parks should spend more time on things like the budget and public pensions reform, and less on what we Angelenos get to eat for lunch.

(Crossposted at Sister Toldjah)


Privatize Social Security?

December 29, 2010

If empirical observation shows a better solution to old-age pensions and public debt, shouldn’t we take a serious look at it? It’s worked wonders in Chile:

Pinera’s proposal began with scrapping the payroll tax on the country’s social security system and inviting all workers to take the money they were contributing and move it into a private pension.

Workers would be free to choose the fund, how much to put in, and at what age they would retire, with a minimal safety net built into the design. Past contributions would be refunded to workers by government bond. And anyone who didn’t like the idea was free to remain with the system as it was. It was a huge success: 95% of Chile’s workers chose the private system.

Pinera told the public to expect a compounded 4% rate of return under the private plan. But as of 2010, the average annual rate of return was 9.23%, far higher than promised.

By contrast, the U.S. social security system, which today accounts for a quarter of the U.S. government budget, is slated to give retiring workers in the next decade a 1% to 2% rate of return. And those entering the system today will see a negative return.

Chile’s implicit pension debt fell to just 6% of GNP — compared with 100% in the U.S., 300% in France and 450% in Italy, leaving Chile with no net debt.

Better still, the accumulated savings in the pension funds fueled Chile’s spectacular economic ascent, taking real incomes from about $4,000 per capita in the early 1980s to $15,000 today, and GDP to the 6% range most years for nearly 20 years. With that record, is it any surprise that Chile this year earned itself a membership card into the club of rich nations, the OECD?

We know our current system is heading for collapse, so, other than fear fed by the demagoguery of the Left, what’s to stop us from looking at a model similar to Chile’s? Shouldn’t workers be able to keep their own money in their own retirement accounts, instead of relying on handouts from a government-run Ponzi scheme?

via Fausta

LINKS: Further observations at No Runny Eggs


Giving thanks for private property

November 25, 2010

Sure, that sounds pedantic and dull – who needs a lesson in the value of property rights to a free and prosperous society, especially on a day when we celebrate turkey and football… oh, yeah, and family, too?

We do.

In an era when government feels more and more able to take your property and do with it whatever it wants, and when one of our two major parties is dominated progressive leftists and the president himself is a socialist, when all the currents of our society seem to be pushing us against our will toward collectivism (and collective penury), we need to be reminded of the lessons our ancestors learned about the value of private property and free markets. And yes, there’s a direct connection to Thanksgiving. First, a video from Reason.TV, via Big Government:

Reporter John Stossel takes the story of the near-tragedy and eventual salvation of the Plymouth Colony further, explaining for us the lost lesson of Thanksgiving:

What Plymouth suffered under communalism was what economists today call the tragedy of the commons. The problem has been known since ancient Greece. As Aristotle noted, “That which is common to the greatest number has the least care bestowed upon it.”

If individuals can take from a common pot regardless of how much they put in it, each person has an incentive to be a free-rider, to do as little as possible and take as much as possible because what one fails to take will be taken by someone else. Soon, the pot is empty.

What private property does — as the Pilgrims discovered — is connect effort to reward, creating an incentive for people to produce far more. Then, if there’s a free market, people will trade their surpluses to others for the things they lack. Mutual exchange for mutual benefit makes the community richer.

(…)

Secure property rights are the key. When producers know their future products are safe from confiscation, they take risks and invest. But when they fear they will be deprived of the fruits of their labor, they will do as little as possible.

So there you have it, folks. When you sit down to that big turkey dinner and pass the potatoes, think back to the real lesson of Thanksgiving and give thanks for what made it possible: private property and free markets.

LINKS: Power Line quotes extensively from Professor Paul Rahe on Plymouth: America’s First Socialist Republic. Allahpundit cites some liberal rebuttals at Hot Air.

PS. I also want to give thanks to my blog-buddy, ST, who’s been gracious enough to let me play in her sandbox these past few months. It’s been a lot of fun, and I look forward to even more.

(Crossposted at Sister Toldjah)


Voting with our feet

November 17, 2010

One of the functions of the decennial census is to determine how many seats each state gets in the House of Representatives.  While this doesn’t enable us to determine  in detail who is moving where and why, one can make a few broad generalizations with some confidence based on the likely apportionment.

And one of the chief among them is that people are fleeing high-tax, heavy government states like the plague:

Migration from high-tax states to states with lower taxes and less government spending will dramatically alter the composition of future Congresses, according to a study by Americans for Tax Reform

Eight states are projected to gain at least one congressional seat under reapportionment following the 2010 Census: Texas (four seats), Florida (two seats), Arizona, Georgia, Nevada, South Carolina, Utah and Washington (one seat each). Their average top state personal income tax rate: 2.8 percent.

By contrast, New York and Ohio are likely to lose two seats each, while Illinois, Iowa, Louisiana, Massachusetts, Michigan, Missouri, New Jersey, and Pennsylvania will be down one apiece. The average top state personal income tax rate in these loser states: 6.05 percent.

The state and local tax burden is nearly a third lower in states with growing populations, ATR found. As a result, per capita government spending is also lower: $4,008 for states gaining congressional seats, $5,117 for states losing them.

The article also draws a correlation between states that require the payment of union dues (losing seats) and right to work states (gaining seats).

There are some obvious lessons to be drawn here about tax competition and free labor: first, businesses and wage-earners will be attracted to states that let them keep more of their own money and not burden them with excessive regulation.  The second and related point is that granting unions a monopoly over labor (or access to taxes disguised as “representation fees” for those who don’t join the union) drives up the cost of labor to such a point that businesses will look to relocate elsewhere. It’s no coincidence that businesses (and their jobs) are fleeing high-tax, big government California, while low-tax, light-regulation Texas accounts for half of all the jobs created in the nation over the last year.

Will job-killing states learn this lesson? But maybe, like so many addicts, not until they hit rock bottom.

UPDATE: A timely example, via Heliogenic Climate Change.

-ANAHEIM, R. Frautschy: (…)

A recent discussion with my accountant determined that in order to comply with AB32 it will cost me almost the same amount as my yearly payroll. Now add in all the new or raised business taxes, and I must more than double the company income to make ends meet.

I received an offer from the state of Nevada. If I move my company to Nevada, my taxes will be 83 percent lower, no AB32 complications. Lower health care costs and more. It’s a no-brainer. I am laying off my entire staff and moving to Nevada. So, as of Dec. 31, 2010, the state of California will have 32 highly skilled workers on their unemployment hands. The unemployment rate is high in Nevada, so I can hire all new employees for much less.

(Crossposted at Sister Toldjah)


If this is a recovery, where are the jobs??

October 31, 2010

President Obama (and especially his fawning sycophants in the media) likes to compare himself to Franklin Delano Roosevelt, who lead the nation during the Great Depression. In this brief video essay from Reason.TV, Ted Balaker looks at the current jobless recovery and see other similarities to FDR that Obama might not enjoy:

Balaker and Professor Ohanian blame the uncertainty caused by the raft of new regulations and laws coming from Washington, as well as uncertainty about the effects the progressives’ spend-and-borrow binge may have. Businesses hate uncertainty, because it leaves them with no way to forecast what conditions will be like, hence making them less willing to risk capital on new employees. It is, in fact, a rational response, something FDR never quite got: he wanted to tax retained earnings, solely to punish businesses that wouldn’t spend. The Obama administration has broached a similar idea.

While I agree about the uncertainty created by government intervention in the market, I’d add another factor: policies that are just plain bad, because they make the economic situation worse. In the video, we see one good example: the CEO of Nationwide Support Services wait anxiously to hear the details of a new FTC regulation; depending on how it goes, she may not be able to hire the new people she’d like to hire – or she may have to go out of business altogether.

Really, is this any way to run an economy?

Of course it isn’t. As is becoming increasingly clear as new research is done into the New Deal, the statist, interventionist policies of the Roosevelt administration (and Hoover’s) did not help. Indeed, they prevented a job-creating recovery.

The best thing the government could do would be to quit intervening in the marketplace and stop trying to engineer it. It’s simply much too complex to be controlled by a relatively small number of policy-makers. With minimal intervention and a lightened burden of spending, taxation, and regulation, the market economy will heal itself and create jobs.

Sadly, that’s a wise course we can’t expect from the current crowd, so this Tuesday we take step one in a two-step process of firing and replacing them with people who get it.

Step two comes in 2012.

PS: Yeah, I’ve been tapping Reason.TV a lot today, but, what can I say? They do good stuff. 

(Crossposted at Sister Toldjah)


Bill Whittle: What we believe – on wealth creation

October 23, 2010

Bill Whittle continues his series on what American conservatives believe by taking a look at the creation of wealth and the fundamentally different ways Right and Left think about it:

I have a good friend who’s a dyed-in-the-wool liberal, and I’m convinced his deepest feelings about wealth fit Whittle’s description to a “T.” That, somehow, the accumulation of wealth beyond a certain point must be morally compromised: either it was unearned or in some way stolen from others. It couldn’t be earned legitimately; there must be some taint of immorality about it.

That’s a fundamental difference between him and me, and I’d swear that same opinion about the essential immorality of wealth accumulation lies at the foundation of Leftist politics.

As our President said, “At some point, you’ve earned enough money:”

It reminds me of an old joke about the difference between a conservative and a liberal:

A conservative down on his luck finds himself wandering through a wealthy neighborhood and sees a beautiful house on a hill. He looks up and thinks to himself, “Someday, I’m going to be that guy.”

Later that day, a liberal down on his luck finds himself wandering through the same wealthy neighborhood and sees the same beautiful house on a hill. He looks up and thinks to himself, “Someday, I’m going to get that guy.”

It’s so true.

LINKS: More at Hot Air.

(Crossposted at Sister Toldjah)


What we believe: conservatism and the Tea Party

October 9, 2010

Bill Whittle has long been one of my favorite PJTV commentators; his video essays are incisive, uncompromising, and closely reasoned, all done in sincere, good-natured, and polite style. He’s not a firebreather; he doesn’t have to be, because he knows what he’s talking about.

Bill has a new video on his own YouTube channel (ht: Hot Air) in which he provides a clear, simple statement of the essential tenets of American conservatism: a belief in limited government and free enterprise. It’s well-worth the ten minutes of your time to watch:

While I think “classical liberal” is more accurate than “conservative,” that’s an argument over terminology that just isn’t all that important these days. What truly is important is the message: limited government versus the all-powerful state and individual liberty versus tyranny. Whittle introduces our side of the argument beautifully, and I’d like to see this video posted widely across the blogosphere.

And I dare any progressive to post as simple, clear, and honest an explanation of their beliefs in response. No emotional appeals to being “for the children” allowed.

It would be illuminating.

(Crossposted at Sister Toldjah)


Econ 101: the perils of Moral Hazard

August 8, 2010

I’ve occasionally posted videos from the Center for Freedom and Prosperity, an ally or affiliate of the libertarian Cato Institute, that touch on aspects of economics and why government intervention in the free market often causes more problems than it solves. In this offering, the speaker discusses “moral hazard,” in which government interventions provide incentives for people to engage in irresponsible behavior:

What I like about this series is that it teaches economics by focusing on human behavior, rather than abstruse formulae and obscure jargon, and I recommend taking the time to watch them all.

(Crossposted at Sister Toldjah)


Choice works: the rebirth of New Orleans schools

July 8, 2010

From Reason.TV, here’s a short documentary about how educators in New Orleans used the devastation caused by Hurricane Katrina to rebuild New Orleans’ school system, once one of the worst in the nation, along free-market lines founded in parental choice:

The results have been very encouraging. As Nick Gillespie explains at Big Government:

Today, New Orleans has the most market-based school system in the US. 60% of New Orleans students currently attend charter schools, test scores are up, and talented and passionate educators from around the country are flocking to New Orleans to be a part of the education revolution. It’s too early to tell if the New Orleans experiment in school choice will succeed over the long term, but for the first time in decades people are optimistic about the future of New Orleans schools.

And yet this is the very kind of program President Obama wants to deny the poor children of Washington, DC.

LINKS: More from Hot Air.


When bureaucrats get bored

June 30, 2010

Boredom must be a real problem for bureaucrats, especially in the European Union. How else does one explain jackassery such as this?

EU to ban selling eggs by dozen

Shoppers will be banned from buying bread rolls or eggs priced by the dozen under new food labelling regulations proposed by the European parliament.

Under the draft legislation, to come into force as early as next year, the sale of groceries using the simple measurement of numbers will be replaced by an EU-wide system based on weight.

It would mean an end to packaging descriptions such as eggs by the dozen, four-packs of apples, six bread rolls or boxes of 12 fish fingers.

The Government appeared to have been caught out by the change, but yesterday Caroline Spelman, the environment secretary, signalled Britain would now step in to prevent the rule being enforced.

MEPs last week voted against an amendment to new food labelling regulations that would allow individual states to nominate products that can be sold by number rather than by weight.

Individual countries are currently allowed to specify exemptions but the new rules under discussion make no such provisions.

The changes would cost the food and retail industries millions of pounds as items would have to be individually weighed to ensure the accuracy of the label.

That last should read “…needlessly cost the food and retail industries millions of pounds…” Sure, standardization has some benefits, but how much will EU consumer benefit as compared to the expenses born by the companies (which they’ll pass on to consumers)? Is it really worth it?

And why even bother? What pressing Union-wide need was there for this rule? Doesn’t Brussels have anything better to do? Doesn’t the European Parliament care about this further micromanagement of daily life by a distant bureaucracy?

I think we know the answer to that.

PS. And America is on the same path.

(via Dan Mitchell)


By Obama, you’ve made enough money!

April 29, 2010

Wrapped up as I was in the desperate efforts to protect the President from terrorist grannies, I missed this gem from his speech in Quincy, Illinois:

Excerpt via Ed at Hot Air:

We’re not, we’re not trying to push financial reform because we begrudge success that’s fairly earned. I mean, I do think at a certain point you’ve made enough money. But, you know, part of the American way is, you know, you can just keep on making it if you’re providing a good product or providing good service. We don’t want people to stop, ah, fulfilling the core responsibilities of the financial system to help grow our economy.

That was not in his prepared remarks, and I’m sure TOTUS wasn’t happy.

Is there any clearer expression of the statism at the heart of this administration? Not only do Obama and the (Social) Democrats claim the power and the requisite wisdom to regulate broad swathes of the economy, but the President himself claims to know better than you when you’ve earned enough money, beyond which, we assume, one enters the realm of “unfair.”

It also shows (again) that he just doesn’t “get” capitalism or market economies. The promise of possibly earning more money is what encourages people to start a business, hire more people (Remember jobs, Mr. President?), and take risks. That incentive system, coupled with a relative lack of government interference,  is why our economy has been phenomenally successful. By saying “you’ve made enough,” you take away any incentive for people to work harder. Why should I or anyone risk capital in an investment, or take a job that eats up most of my time, if you are going to tell us we can only make so much from it? What’s next, wage and price controls a la Diocletian and Nixon?

And the arrogance! That a man who has never worked in private business, whose whole adult life has been in academics, non-profit, and government work should think that he knows how much a businessman or an investor should make in return for their effort and risk? A man who knows next to nothing about economics? How is this even in Washington’s purview?

How about trying to do the jobs the federal government is assigned, rather than everything it isn’t?


A British view of US fiscal insanity

April 8, 2010

Nile Gardiner writing in at the Telegraph web site on Paul Volcker’s raising the possibility of a Value-Added Tax in the US:

I cannot think of any move by the US government that would be better designed to shed jobs, undercut small businesses, frighten foreign investment, and kill economic growth, than to raise taxes and build a climate of economic uncertainty. If Barack Obama wants a European-style tax system, he must also face the spectre of European-style levels of unemployment (as high as 20 percent in countries like Spain), capital flight out of US markets, and frightening levels of government bureaucracy.

The surest way to reduce the deficit, create jobs and spur economic growth is by cutting government spending, reducing taxes, and getting rid of excessive regulation and red tape. There is a direct correlation between levels of economic freedom and economic prosperity. By going down the well-worn route practiced by major European economies such as France and Germany, the Obama administration will only undermine both.

The introduction of a further layer of national taxation would be a huge leap forward for the United States towards a continental European vision of economic management. It would strike a significant blow against economic liberty in America, and would be another sign that Barack Obama is willing to sacrifice American global power on the altar of big government. There can be only one end result from this kind of folly – a large drop in US economic competitiveness and the decline of a superpower.

It seems the President’s agenda is the opposite of Reagan’s: whereas President Reagan wanted to cut taxes to “starve the beast” and reduce the size of the federal government (an effort in which he had limited success), Obama wants to first inject the beast with steroids so it grows so large that we have no choice but to feed it via higher taxes.

The trouble is that, in contrast to Reagan’s ideas, which unleashed the American economy and laid the ground work for roughly 20 years of unprecedented growth, Obama’s plans seem certainly to shackle and hobble that same engine of wealth-creation for the foreseeable future.

November, 2010, cannot come fast enough.

RELATED: “The Hungry Maw of Endless Taxation” at Blue Crab Boulevard.


Follow

Get every new post delivered to your Inbox.

Join 12,164 other followers