May 2012

Thoughts about McCarran-Ferguson

by Eli Lehrer on March 26, 2007

in Insurance

Senate Minority Whip Trent Lott, angry with the whole insurance industry over the situation in his home state of Mississippi, has announced that he wants to do away with the 1945 McCarran-Ferguson law. Friends on the Hill tell me he’s quietly gathering support. It won’t move forward for now, but I could see things changing.

Right now, the McCarran-Ferguson Act grants insurance companies a limited antitrust exemption. The law lets insurance companies share risk and rating data in a way that other private companies typically couldn’t. (The law also implicitly mandates state insurance regulation.) I’m skeptical of most antitrust law and, in the insurance industry in particular, there are real consumer benefits to allowing companies to share data on price and risk.

So how does this impact Mississippi and Trent Lott? Best as I can tell, it doesn’t. As I discuss in The Weekly Standard, Mississippi faces a complicated and thorny situation that leaves almost all players with a variety of bad short-term choices. There are, I think, long term solutions but ultimately, I can’t see how what Lott is proposing will help Mississippi in the short term.

[click to continue…]

The poor are always with us (and enviros mean to keep it that way)

by Iain Murray on March 26, 2007

in Environment, Nanny State

In Scotland and Australia, two places as far apart on the globe as you can get, people are realizing that rationing carbon is a socially regressive move.

In Scotland:

An energy underclass could develop in Scotland if personal carbon trading is introduced in the fight against climate change, urban planning experts warned yesterday.The Royal Institution of Chartered Surveyors in Scotland voiced concerns that low-income households could be driven into an eat-or-heat situation if tradable allowances were introduced.

In Australia:

THE jobless would be hardest hit by carbon pricing, with new research showing low-income households would have to pay about $600 a year to fight climate change.

The research by academic Peter Brain found carbon pricing would disproportionately affect people on low incomes, especially the unemployed.

When they’re not suggesting that the poor and unemployed will find new, highly-paying jobs in the wind-farm construction and hybrid battery industries, the preferred solution of the greens is to advocate a vast new income-redistributing bureaucracy to provide energy welfare to the poor, because government has all the answers (particularly, it seems, to the problems it creates).

Commenting on GW — what can economists contribute?

by Fran Smith on March 26, 2007

in Economy, Global Warming

The excellent classical liberal economics blog www.cafehayek.com had a short post Friday by Russell Roberts on Richard Lindzen’s podcast on Bloomberg. The posting generated a lot of interesting comments on global warming — and whether economists have anything to contribute on that issue.

Death by Regulation 2.0

by Iain Murray on March 26, 2007

in Precaution & Risk

A firefighter in the UK is facing suspension for breaking fire service regulations.  His breach?  Saving a drowning woman’s life:

The brigade’s rules state: “Personnel should not enter the water.” The fire crew should instead have tried to haul the woman out using poles and ropes.

Stephen Hunter, chief fire officer of Tayside Fire and Rescue, admitted that fire engines in Perth were not equipped with the correct poles and ropes, but insisted that Mr Brown had broken the rules.

He said: “Firefighter safety is of paramount importance to us. Although our duties include rescues from flooding, there is no statutory obligation to carry out rescues from moving water.”

Tim Worstall has more.

Give Us Some Decent Games

by Cord Blomquist on March 26, 2007

in Personal Liberty, Tech & Telecom

Last week, Rep. Fred Upton (R-Mich.)introduced H. R. 1531, the “Video Game Decency Act.” This bill is in response to the Hot Coffee controversy, which refers to the sexually explicit unlockable mini-game in Grand Theft Auto: San Andreas.

Sen. Brownback (R-Kan.) has also introduced a bill to deal with this controversy (see my 2/15 post on Sen. Brownback’s bill). His bill would require the Entertainment Software Ratings Board (ESRB) to play the “entire game,” a measure that shows Senator Brownback and his staff have never played a modern video game.

Unlike classics like Mario Brothers, modern games don’t play from left to right, level by level. Instead, they are worlds of infinite possibilities. You can no more play the “entire game” than you can play every game of football.

Rep. Upton’s bill avoids this pitfall by mandating that unlockable portions of games must be disclosed to the ESRB. Yet the ESRB has already included this in its contracts with game publishers:

Every publisher of a game rated by the ESRB is legally bound, by contract, to disclose all pertinent content during the rating process, including, as of July 2005, content that may not be playable but will exist in the code on the final game disc (i.e. “locked out”)…incomplete disclosure…could result in revocation of the original rating and the imposition of sanctions, including monetary fines.

Rep. Upton’s bill avoids the First Amendment violations and industry-paralyzing consequences of the the Brownback bill. However, Congress is lagging nearly two years behind the industry, which has already changed their policy to conform to changes in the technology, leaving one to wonder if this bill has any purpose at all. Certainly it’s already illegal to commit fraud or a break a contract. It seems as though Rep. Upton would like to claim credit for a policy change that the gaming industry has already made.

Raters such as the ESRB are concerned about accuracy, so their policies will continue to change to make sure that accuracy is maintained. Contracts, not Congress, have already solved this bug in the ratings system.

Fortune smiled on these companies

by Fran Smith on March 23, 2007

in Environment, Sanctimony

Fortune magazine has come out with its list of “America’s Most Admired Companies.” Here are the top ten:

1. General Electric

6. FedEx

2. Starbucks

7. Apple

3. Toyota Motor

8. Google

4. Berkshire Hathaway

9. Johnson & Johnson

5. Southwest Airlines

10. Procter & Gamble

According to the magazine:

To create the top 20 for our 25th annual rankings, Fortune and its survey partners at Hay Group asked 3,322 executives, directors, and securities analysts to select the 10 companies they admire most. Having fresh ideas and being green are among the qualities that distinguish this year’s winners.

It’s fun to read the blog postings. A lot of disgruntled shoppers, and a lot of political correctness — I think PETA had a campaign going to object to P&G making the top 10 — lots of “animal torture” statements. And, of course, the usual Wal-Mart attacks, something like, “they exploit workers, especially the elderly, single mothers, the disabled and people on welfare.”

Occasionally, a different view comes through — like this one:

Is it the 20 most admired companies or the 20 most eco-friendly companies? Hug a tree, park the car.

Posted By Jeremy, visalia, ca : March 7, 2007 2:48 am

Boutique Poverty

by Richard Morrison on March 23, 2007

in Environment, Sanctimony

I love The New York Times. Not the news and editorial departments of course – the true object of my desire is the food, style, design and travel coverage. The reason for this is very simple: whenever I need a pretentious, out-of-touch theme story on the latest trend in sustainable caviar-spoon technology, my beloved Times is there. The lifestyle editors would rather vacation on the Jersey coast than print something as prosiac and bourgeois as, say, “10 Easy Chicken Recipes a Busy Single Parent Can Prepare in 30 Minutes or Less.” Let the weeklies in the sticks run that trash. Much better to profile a free range poultry farm where heritage breeds are pre-infused with provencal herbs by grazing among organically-fertilized plots of rosemary and chervil.

Today’s Home & Garden section has a special gem of classic Times ridiculousness. Colin Beavan and Michelle Conlin live with their 2-year old daughter Isabella in “an elegant prewar [co-op apartment] on Lower Fifth Avenue” decorated with chic “neo-Modern furniture.” He’s a nonfiction author, she’s a writer at Business Week. They have a great apartment, successful careers, an adorable toddler, and seemingly everything a successful Manhattan couple could want. Except, that is, toilet paper in their bathroom. You see, the Beavan-Conlins have decided to pursue a “No Impact” lifestyle, which means organic, locally-grown food, no significant material purchases, no carbon-fueled transportation and no disposable paper products:

Toothpaste is baking soda (a box makes trash, to be sure, but of a better quality than a metal tube), but Ms. Conlin is still wearing the lipstick she gets from a friend who works at Lancôme, as well as moisturizers from Fresh and Kiehl’s. When the bottles, tubes and jars are empty, Mr. Beavan has promised her homemade, rules-appropriate substitutes. (Nothing is a substitute for toilet paper, by the way; think of bowls of water and lots of air drying.)

Yet since the beginning of No Impact, and to the amusement of her colleagues at Business Week, Ms. Conlin has been scootering to her office on 49th Street each day, bringing a Mason jar filled with greenhouse greens, cheese and her husband’s bread for lunch, along with her own napkin and cutlery. She has taken a bit of ribbing: “All progress is carbon fueled,” jeered one office mate.

Here, here, unnamed Business Week colleague. Of course, there are a few exceptions. They still use the stove and a few incandescent light bulbs (why haven’t they gone compact fluorescent?), as well as the laundry facilities in their building, but they’re trying real hard. Amazingly, even after all of their sacrifices, they still feel guilty. Father Colin tells a story of going to a used clothing shop to buy their daughter a $1 present for her birthday:

It was freezing cold that day, Mr. Beavan said, picking up the story. “We went into a restaurant to warm her up. We agonized about taking a cab, which we ended up not doing. I still felt like we really screwed up, though, because we ate at the restaurant.”

He said he called the 100 Mile Diet couple to confess his sin. They admitted they had cheated too, with a restaurant date, then told him, Yoda-like, “Only in strictness comes the conversion.”

It seems living life like a primitive while residing in New York City is a fascinating experience, if you can afford it.

>>Seen on Drudge and passed on by Marc Morano.

Ethanol ain’t no magic bullet (2)

by Fran Smith on March 23, 2007

in Environment

Citizen groups in many small Midwestern towns are trying to stop ethanol plants from being built in their communities, according to today’s front-page article in the Wall Street Journal (subscription required). Fueled by a 51 cents per gallon federal government subsidy and other incentives for “alternative energy sources,” ethanol production from corn is driving up the cost of food, meat and poultry, as well as the prices of Midwestern farmland.

Corn-based ethanol has been touted by policymakers — and producers — as a panacea to solve both energy security and environmental problems.

Now, community groups are objecting to ethanol plants because of their environmental impact. As the WSJ puts it:

Opponents complain that ethanol plants deplete aquifers, fraw heavy truck traffic, pose safety concerns, contribute to air pollution and produce a sickly-sweet smell akin to that of a barroom floor.

While the article focuses on the town of Cambria, Wisconsin, and its resistance to a local ethanol plant, the WSJ notes: “Fights have broken out in Indiana, Illinois, Missouri, Nebraska, Kansas and several towns in Wisconsin.”

For CEI’s take on potential problems with government-subsidized ethanol production, see Dennis Avery’s recent monograph here.

After Gore: Observations on Bjorn Lomborg’s Testimony

by RJ Smith on March 23, 2007

in Environment

For those of you who missed Bjorn Lomborg’s testimony after Gore’s “triumphant return” (Katie Couric’s words, not mine) to Capitol Hill, he did a great job attacking the crisis mentality on climate change. His main point was that all peer-reviewed cost-benefit studies suggest we should do very little regarding the climate and referred to “vast frivolous projects like the Kyoto Protocol.”

Chairman Bart Gordon (D-TN) did a vicious hit job on Lomborg in his introduction. He said while America takes great pride in freedom of speech, we have to separate science from opinion and that every “credible organization” has said Lomborg is basically wrong and dishonest: the Danish Scientific Committee on Dishonesty, the NAS, Science, Nature, Scientific American, etc. Gordon also said Lomborg believed “Jews weren’t singled out by Nazis”–which is an outright lie. (My colleague, Iain Murray, says that someone reviewing Lomborg’s book, The Skeptical Environmentalist, said that Lomborg’s arguments were the equivalent of saying the Nazis didn’t single out Jews.)

Lomborg quietly responded “Thank you very much for your welcome here.”

Rep. Jay Inslee (D-WA), who always wraps himself in God, was even nastier, if possible. He said: “In Genesis we were given the moral obligation to take care of the Creator’s garden.” You’re not telling us that we should not obey the word of God are you? You’re saying America is not capable of taking care of HIV, malaria, and global warming all at the same time. But I am here to tell you you’re wrong. Maybe Denmark can’t do all those things at the same time, but America can.”

Lomborg’s response was great: “If you say you can and will do all these things, why didn’t you do them in the past 10 years?” He went on to point out “If it’s so easy (costless) to reduce CO2, why did CO2 emissions rise 18% while Gore was VP?”

After Gordon’s initial ad hominen attack on Lomborg, he left and the only Democrat who stayed was Inslee as chair. There were no other Dems at any time. There were about 9-12 Republicans, most of whom commented on the fact that the Dems had no interest in ideas or the truth, that they only wanted to applaud Gore and then leave. By far the two outstanding GOP stars who asked the most intelligent questions and who seemed to understand what was going on, etc., were John Shadegg of AZ and John Shimkus of IL. Clearly they were both well-versed and had had some good staff work. (Shadegg also said the Dems must be afraid to hear what you’re saying and that’s why none of them are here.)

Lomborg to Shadegg: re Gore freezing CO2 emissions, “You could do it, but it wouldn’t accomplish anything.” On cutting C02 emissions by 90%, Lomborg said “I just think it is ludicrous and cost would be in excess of $85 trillion.”

Sullivan of Oklahoma asked for the two most outrageous Gorisms. Lomborg’s response: “The 20 foot sea level rise is unbelievable — especially that he can get away with saying those things.” And “That it’s actually going to be costless reducing emissions and that we’ll actually make money doing it.”

Inslee became indignant that Lomborg was criticizing Gore, “You have constantly, repeatedly misrepresented what the vice president of the United States has said.”

Lomborg also stressed how Gore and others never discuss both sides of an issue. They go on and on about heat deaths and never mention cold deaths. A couple of times he talked about how in the UK everyone is still talking about 2,000 heat deaths from a few years ago but don’t say a word about the 25,000-plus cold deaths that occur every year. He said of course there will be an increase in heat deaths, but there will be a vast decrease in cold deaths.

I’m sure Lomborg irritated Inslee and Gordon appearing suitless and tieless, wearing his tight black muscle T-shirt.

Modern Prometheus

by Greg Conko on March 23, 2007

in Economy, Environment, Nano & Biotech, Precaution & Risk

Norman Borlaug, the Nobel Peace Prize winning agronomist, will turn 93 on Sunday, March 25, 2007. It’s a birthday well worth celebrating. His life’s work — known around the world the Green Revolution — is estimated to have saved more than a billion human beings from starvation. Still, at age 93, Borlaug still spends much of his time in the wheat and corn fields outside Mexico City, helping teams of scientists and farmers breed new and improved varieties. And, he jets around the world, working with farmers in Africa and Asia, and trying to convince governments that they should free their people and allow them to apply the best new technologies and their own ingenuity to conquering the problems that cause low agricultural productivity and food insecurity.

I first met Norm (and this kind and amiable man always insists that people call him Norm, not Doctor, Professor, or Sir) some years ago. But I had the enviable opportunity to spend a good deal of time with him when CEI gave him our Prometheus Award for Human Achievement in 2004. We hosted him in Washington for four days, and over that time I got to know him reasonably well. He always spoke with great passion about his own work and that of the countless others whose innovative research he has helped to spread around the world.

He also spoke with great passion about the love of his life, his wife Margaret. Tragically, Mrs. Margaret Borlaug passed away on Wednesday, March 7, 2007 at the age of 95. It’s not every spouse who will gladly pick up her family and move it to a foreign land, where they will live in modest conditions. But, Margaret was a strong and wise woman, and she gladly moved with Norm and their children to Mexico, where they dedicated their lives to helping others by promoting science, technology, and common sense. Her contributions were thus as important to the Green Revolution as almost any other person’s. So, anyone who values freedom and progress owes both Norm and Margaret a great deal of thanks.

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