Sunday, February 26


Mandatory household recycling is a money loser.

For materials with no natural markets for their reuse, the benefits of recycling are less than its costs – and, therefore, government efforts to promote such recycling waste resources.

Obama's faulty economics thinking

Peter Morici writes:
Regarding the financial crisis, the president assigns blame to the lack of regulation. The facts are banks got into trouble making loans on real estate assigned inflated values to borrowers who could not repay. Loans were bundled into bonds and sold to investors. When not enough unwitting fools bought bonds, the big Wall Street banks put unsold securities into offshore special investment vehicles whose potential losses were not supposed to be a claim on bank capital. Other firms, like AIG, sold insurance against potential losses on bonds without sufficient assets to back up that protection.

When the loans and bonds failed, it turned out those special investment vehicles were indeed a drain on bank capital, and Citibank, AIG and others needed bailouts to avoid the complete collapse of bank credit available to the economy.

All this was a massive accounting fraud, something big public accounting firms were supposed to catch in audits of banks but didn't — a failure Sarbanes-Oxley regulations, passed in 2002, were supposed to avert.
The solution imposed by the Dodd-Frank bill is to ban propriety securities trading by banks and impose burdensome lending regulations on surviving community and regional banks, which were more victims of the bubble than malefactors in the crisis.

Proprietary trading had little to do with instigating the mess, and profits from trading actually helped big banks rebuild balance sheets more quickly. And now onerous regulations have hamstrung community and regional banks and are forcing them to seek buyouts by larger Wall Street banks, which caused the crisis and have little interest in lending to small and medium sized businesses that create jobs.

When faced with resulting problems, the president explains he is saving the country from unstable growth of decades past. Yet, economists of all stripes refer to the 20 years prior to the crisis as the "Great Moderation," owing to exceptional stability in economic activity and employment not before experienced in U.S. history.

President Obama persistently preaches that solar, wind and other alternative technologies will make America energy independent and sustain economic superpower status. Yet, any reasonable reading of the prospective economic viability of these technologies, and any assessment of the likely transition of the automobile industry to hybrids and electrics, indicate the nation will remain significantly dependent on petroleum for at least the next two decades.

Yet, with oil above $100 a barrel handicapping the U.S. economy, the president imposes regulations that all but shut down deep water drilling in the Gulf of Mexico and other offshore locations where the real potential for new American oil supplies lies. Instead, he plows money into projects like Solyndra that independent financial analysts predicted would likely fail.

Americans pay at least 50 percent more than Europeans for health care, often with less satisfactory outcomes, because the federal government pays for more than half of health care but does not impose price and access controls as effective as those in Europe.

Obamacare simply doesn't fix what's broke. Instead, it raises taxes to provide more subsidies and imposes more mandates on businesses. Any economist will tell you subsidies and mandates to purchase a product raise its price, and health care is no exception.

Tuesday, February 21

Why Obama opposed SOPA and PIPA

Joel Kotkin: President Obama Courts Silicon Valley’s New Digital Aristocracy
Even when they’ve competed with and acted like more established power brokers, the digital ruling class are treated with kid gloves compared to other wealthy elites, rarely suffering the disdain aimed at amoral bankers and at Hollywood’s general venality. Instead, the creators of our iPhones, social networks and Twitter accounts are held up as tool makers and business titans....
The new plutocrats are unburdened by the obligations that come with existing large institutions; with no union presence, they don’t have to worry about anxious retirees or redundant older workers. Green pet causes that align with their financial interests buy more cover from the left, while conservatives, who rarely see anything wrong with extreme wealth, seem somewhat unconscious about the political orientation of the emerging new elite. Ninety-two percent of Facebook executive donations so far this year went to Democrats. This exceeds even the rock-solid support the Democrats enjoy among more established firms like Google and Apple, where support for Democrats runs to the high 80s.
The Obama administration’s opposition to the anti-piracy bills SOPA and PIPA came despite intense lobbying for the bill by his party’s long-time allies in Hollywood. Whatever the bills’ failings, their defeat also formally introduced the new power of the digerati moguls and their millions of followers....
In California, the alliance between progressive Democrats and high tech is palpable. The digital elite has been a consistent backer of Gov. Jerry Brown’s jihad on greenhouse gases, helping finance the campaign against a 2010 measure intended to reform state’s draconian and likely job-killing energy and land-use laws. Google has emerged both as a key backer of the state’s climate-change politics and sought to profit by investing nearly a billion dollars in renewable-energy companies. These firms in turn depend on the state’s strict mandates on utilities to use “green” electricity for their revenues. It’s no coincidence that prominent valley VCs have been particularly active in alternative-energy firms such as Solyndra.

Wednesday, February 15

Access Denied

That's the message I get when I try to access

The page adds: You are not authorized to access this page.

Here's a couple of screen caps:


Oh, it's been updated.

Saturday, February 11

Does Obama hate renters and people who live on interest earnings?

Does Obama hate renters? Or is this supposedly smart guy unaware of their existence?
I haven’t heard one word about the poor, struggling renters, the ones who scrimped and saved and put money away each month towards a down payment, who kept the credit cards paid off, stayed out of trouble, and lived modestly, and thought that maybe, just maybe, the fall in housing prices meant that they, finally, could afford a house — maybe one of those foreclosed units down the street. These people are Bastiat’s unseen. For them, Obama’s housing plan is a giant slap in the face. To hell with the prudent. Party on, profligate! Now that’s what I call moral hazard.
Does Obama hate people who live on interest earnings? Or is this supposedly smart guy unaware of their existence?

Wednesday, February 8

Romney & the Republicans

A party with irreconcilable goals:
The distinction between Romney’s support for properly managed stimulus and his criticism of the Obama plan as passed is murky enough to give even his advisers pause. Asked over the phone whether it would be fair to say that Romney supports stimulus spending as long as it’s the right kind of stimulus spending, Romney’s policy advisor starts to answer, then pauses for several seconds before responding hesitantly that he has the impression that’s true but will need to check further.


Romney’s insistence on having it both ways at every opportunity reveals not just his own incoherence but a party with irreconcilable goals: a leaner federal government that cuts no major programs, a balanced budget with a beefed-up defense budget, entitlements that are reformed and reduced but never cut or changed.