January 2012

Whither Union Transparency?

by Ivan Osorio on January 20, 2009 · 1 comment

in Economy, Labor, Regulation

As Barack Obama is sworn in as the nation’s 44th President today, Rep. Hilda Solis (D-Calif.) will likely be the next Secretary of Labor. As I’ve noted here recently, her cozy relationship with organized labor should raise concern among not only lawmakers and the public, but among rank-and-file union members who could soon find it harder to find out how union leaders spend their dues. The Department of Labor, under outgoing Secretary Elaine Chao, has enacted stronger reporting requirements. Reports The Los Angeles Times:

The federal government has adopted new financial disclosure rules for labor organizations that officials say would help expose the sort of corruption allegedly found in the largest California chapter of the Service Employees International Union.

The U.S. Labor Department, in the final hours of the Bush administration, has toughened standards to require most unions to publicly report nearly all compensation and expenses for officers and employees, the agency announced Friday.

Also broadened were disclosure requirements for the sale and purchase of property, with the aim of revealing whether any union officers or employees profit from the transactions.

In the alleged SEIU scandal, the Los Angeles-based local’s former president, Tyrone Freeman, has been accused by the union of enriching himself and his family with more than $1 million in misappropriated dues money. The SEIU ousted him after The Times reported on his spending practices last summer.

Unsurprisingly, union chiefs are howling, deriding the requirements as “onerous,” and calling for them to be pulled back — except for one.

An SEIU dissident, however, said he welcomed further disclosure. Sal Rosselli, president of an Oakland-based local, has feuded with the SEIU’s national leadership over the direction of the union. He said the national office has refused to fully disclose how much money it has spent on the internecine fight.

“Transparency on how unions spend their members’ dollars, from our point of view, is wanted,” Rosselli said. “We let our members look at every check.”

Rosselli’s local was recently forcibly merged into a giant “superlocal” with the scandal-riddled local formerly headed by Tyrone Freeman.

Having consistently hewed to the union line, Solis could yet surprise by taking seriously the concerns of Rosselli and others with similar criticisms. Step one is simple: First do no harm. In other words, do not scale back reporting requirements only because union bosses want the Department to do so.

In many states, workers must pay union dues as a requirement for employment, through legally imposed exclusive (i.e. monopoly) representation. Short of reform of this situation, the least workers deserve is to know where their dues are going.

For more on the Freeman scandal see here and here.

Departing President Bush to Establish “Freedom Institute”

by Cord Blomquist on January 20, 2009 · 4 comments

in Politics as Usual, Zeitgeist

The Washington Post reports that President Bush will be starting something called the “Freedom Institute” as part of his presidential library in Dallas. This institute would focus on a what the Post describes as a “broad portfolio of topics, including the expansion of democracy abroad and education reforms of the kind Bush implemented during his presidency, according to organizers.”

The Post story goes on to talk about the institute’s goal of focusing on debate:

“The president’s vision is for it to become an incubator of ideas, discussion and debate about the issues that were front and center during his presidency, including the controversy,” said Dan Bartlett, a former counselor to Bush who is acting as a spokesman for the project. “The idea here is to have a place where that debate can continue.”

Not surprisingly, many find President Bush creating something called the “Freedom Institute” to be ironic, or even offensive.  David Boaz of the Cato Institute had this to say at the Cato@Liberty blog:

The president who launched our longest war, arrogated more power to the executive than ever before, increased federal spending by a trillion dollars, pushed for the biggest expansion of entitlements since Lyndon Johnson, further nationalized education, tried to nationalize marriage, and held Americans in jail without access to a lawyer or a judge has found a theme for his presidential library: freedom.

Surely this is an effort to repair George W. Bush’s reputation—his approval rating is the lowest since Richard Nixon resigned in 1974.  But the soon-to-be (at the time of this post) former president insists that the library and public policy institute won’t be about him.  Again, from the Washington Post:

“This is not going to be a ‘George Bush Is a Wonderful Person Center,’ or ‘The Center for Republican Party Campaign Tactics,’ ” Bush said during one of his last media interviews as president. “It’s going to be a place of debate, thought, writing, lecturing.”

Well put, Mr. Bush.

Britain Prays for Obama Miracle

by Iain Murray on January 20, 2009 · 2 comments

in Bailout Watch, Economy, Features, International, Stimulus to Nowhere, Zeitgeist

Over in the UK, their own financial mess is reaching genuine crisis levels. With a trillion dollar national debt, a currency crisis and their own bank bailout (the model Paulson followed) having conclusively failed, Britain is on the edge of bankruptcy:

The country stands on the precipice. We are at risk of utter humiliation, of London becoming a Reykjavik on Thames and Britain going under. Thanks to the arrogance, hubristic strutting and serial incompetence of the Government and a group of bankers, the possibility of national bankruptcy is not unrealistic.

The political impact will be seismic; anger will rage. The haunted looks on the faces of those in supporting roles, such as the Chancellor, suggest they have worked out that a tragedy is unfolding here. Gordon Brown is engaged no longer in a standard battle for re-election; instead he is fighting to avoid going down in history disgraced completely.

The tastefully-named Iain Martin is obviously angry, but he has every right to be. Gordon Brown encouraged Britain to gamble much more of its national income on his watch than America did, all the time proclaiming he had put an end to “boom and bust.” Brown’s bust is now so large it wouldn’t look out of place in a Russ Meyer movie.

That is why Brown and his cronies will be watching today’s inauguration with an audacious hope in their hearts:

In this gloom, the Prime Minister has but one slender hope: that somehow, by force of personality, the new President Obama engineers a rapid American recovery restoring global confidence, energising the markets and making us all forget this bad dream.

If this is the case, it is plain that officials of Her Majesty’s Treasury have not read the So-Called Stimulus Bill.

UPDATE: More on Britain’s plight from the excellent Andrew Lilico.

A Tide Turning?

by Iain Murray on January 20, 2009 · 1 comment

in Energy, Environment, Global Warming

Very interesting new poll from Rasmussen that suggests a significant reversal in public opinion over the causes of global warming.

Forty-four percent (44%) of U.S. voters now say long-term planetary trends are the cause of global warming, compared to 41% who blame it on human activity.

Seven percent (7%) attribute global warming to some other reason, and nine percent (9%) are unsure in a new Rasmussen Reports national telephone survey.

Fifty-nine percent (59%) of Democrats blame global warming on human activity, compared to 21% percent of Republicans. Two-thirds of GOP voters (67%) see long-term planetary trends as the cause versus 23% of Democrats. Voters not affiliated with either party by eight points put the blame on planetary trends.

In July 2006, 46% of voters said global warming is caused primarily by human activities, while 35% said it is due to long-term planetary trends.

In April of last year, 47% of Americans blamed human activity versus 34% who viewed long-term planetary trends as the culprit. But the numbers have been moving in the direction of planetary trends since then.

I must put in the obligatory disclaimer here: I believe that the weight of the scientific evidence points towards human activity having an effect on climate. However, I also believe that this effect is minor and that it is likely to remain minor. Which means that I believe these 44% are wrong. But what is and isn’t true actually isn’t the case here.

The truth is that political action in a democracy depends on what people believe, not on what actually is fact. This significant reversal trend suggests that it will be much harder to justify significant costs – particularly at household level – to combat global warming.

The new Administration and Congress would therefore be wise to step away from expensive anti-energy measures and concentrate instead on improving the resiliency and adaptive capacity of those who are most vulnerable should global warming turn out to be a problem. Otherwise, they run the risk of the electorate reacting like Batman.

HIGH NOON–Inauguration Global Warming Temperature Watch

by Sam Kazman on January 20, 2009 · 7 comments

in Energy, Environment, Global Warming, Regulation

When President Bush leaves office today, will the capital be warmer or colder than when he was sworn in eight years ago?

It’s not scientifically meaningful, but it is interesting.

Bush has been heavily criticized for doing precious little to curb our emissions of carbon dioxide. During his eight years in office, atmospheric CO2 levels climbed by over four percent.

So what did Bush’s dilly-dallying produce in terms of deadly global warming? The temperature at noon in Washington DC will give us one factoid. It’s a scientifically meaningless factoid, since the local temperature on any one day, let alone any one hour, tells us nothing about long-term temperature trends, but it’s heavy in symbolism.

When Bush was first sworn in, in 2001, the temperature at noon in DC was 36 degrees F. What will it be today, when he leaves office? Will the capital be warmer or colder than when he took office eight years ago?

Don’t be surprised if it’s colder. Today’s forecast is for relatively low temperatures. More importantly, despite steady increases in atmospheric CO2, and despite everything you’ve heard about climate catastrophe, there’s been no warming for about the last decade, and the planet has actually cooled over the last three years. (This is from the British Hadley Centre’s data on land and sea surface temperatures. The Centre’s global surface temperature graph shows this in somewhat compressed form, but you can easily graph its data yourself to get a better idea.)

That should lead us to ask where’s the warming?

But first, let’s see what the temperature is at noon, when President Obama is sworn in.

And I repeat–this is scientifically meaningless, but I think it’s interesting.

(As for Bush’s failure to curb CO2 emissions, I doubt that even stringent curbs would have had any effect on atmospheric CO2 levels.  More importantly, that failure was, I believe, a good thing in terms of affordable energy and human wefare.  And the CO2 curbs that Bush did support and which will soon go into effect, such as higher fuel efficiency standards for cars, will prove extremely harmful to both consumers and the auto industry.  But that’s off topic, sort of.)

Economic Hype We Can Believe In?

by Cord Blomquist on January 20, 2009 · 3 comments

in Economy, Features, Stimulus to Nowhere, Zeitgeist

As millions gather on the national mall today to witness the inauguration of Barack Obama, many are looking to the new president not only as a role model and the fulfillment of Martin Luther King’s dream for America, but also as a leader capable of saving us from economic disaster.

Yet, it seems that the economy may not be in as bad a shape as some would have us believe.

The Minneapolis Federal Reserve says that things aren’t that bad. In fact, they’ve made up some handy charts to prove it.

The charts place the current economic downturn into historical (post-WWII) perspective and show that currently the recession is mild.  Of course, we won’t know the length and severity of the recession until it’s over, but right now signs aren’t pointing to it being the worst economic situation since the Great Depression.

Yet that’s what we’re hearing from officials in the Obama administration.  Rahm Emmanuel said so on Meet the Press this weekend.

Even if all of this bluster were accurate and the economy were in a tailspin, there is plenty of reason not to CHANGE as Mr. Obama would have us change. In fact, many are saying that the Great Depression was extended, not curtailed, by FDR’s policies. If Mr. Obama seeks to fashion himself after Mr. Roosevelt, he may extend this recession into a depression no matter how much he “stimulates” the economy.

Hat Tip: Thanks to Bureaucrash Social member Ryan Evans for giving me the heads-up on the Minneapolis Fed charts.

Stimulus Bill Lacks Bold Ideas for Reform

by Cord Blomquist on January 20, 2009 · 1 comment

in Deregulate to Stimulate, Economy, Stimulus to Nowhere

USATODAY.com reports that the stimulus plan has swelled to $850 billion but lacks the bold ideas that are needed for the economy to truly recover.  As USA Today reports:

Obama had proposed an economic stimulus package that aides, including adviser David Axelrod, estimated at $775 billion, nearly 40% of which would be taken up by tax cuts, including a $3,000 job-creation tax credit.

The tax cuts are a good start, but that leaves 60% of the proposal composed of spending programs.  The spending programs are a mixed bag, but many of the suggested programs set a high price on job creation.  A program to modernize Social Security sets the price of job creation at $1 million per job.  Other programs attack the employment issue by hundreds of thousands of dollars to create just one job.  These aren’t the kinds of “shovel-ready” programs that we heard were designed to help the middle class.

When you compare these high-dollar program to other proposed expenditures, like highway projects, you see that the bill isn’t really focused on getting the most bang for our buck.   The highway projects included in the bill would create jobs at roughly $35,000 a piece.  If Mr. Obama and Democratic leaders in Congress want to achieve their goal of job creation, they ought to be focusing on creating the most jobs per dollar and cut the fat from this proposal.

Meanwhile, Republicans on the Hill are proposing that the tax cut portion of the bill be expanded.  As USA Today’s coverage also reports:

The Republican Study Committee, a group of fiscally conservative GOP House members, released a proposal Wednesday that includes trimming individual tax rates by 5% and cutting the top corporate tax rate from 35% to 25%.

While this is a better proposal than a multi-billion-dollar spending spree, it lacks the boldness needed during this crisis.

Granted, politicians are comprise-seeking creatures, but this proposal seems particularly meek when the US is staring at the worst financial crisis since Herbert Hoover was in office.  Someone needs to let the economy out of the chains that Washington has put on it and let America start working again.

Cutting the corporate tax rate to 0% would be the ideal as it would usher in an era of jobs flooding into America, rather than crossing our border to the south and fleeing toward cheaper labor in Asia.  This is likely to be politically untenable, but perhaps a cut down to 15% would be possible now.  It would put the United States on equal ground with Ireland, Europe’s fastest growing economy, and still reverse the trend of job flight.

Perhaps the most overlooked and most important thing we could do to help the economy would be to engage in a systematic program of deregulation.  Mr. Obama could defy political expectations by creating a BRAC Commission for regulations.

BRAC, Base Closure and Realignment Commission was designed to take the politics out of closing military bases.  Because local economies grow around military bases, it became political suicide for Congressmen to vote for base closings in their district or State.  This stalled progress in shutting down any bases, creating incredible headaches for our nation’s military, which needs to be able to shift its resources when needed.  BRAC was created to decided what bases would be closed and then to present the bill to Congress, which it would then have to vote either up or down, with no amendments.

The same local interests are often involved in regulations.  One state might benefit from a regulation on steel makers because it produces aluminum.  Similarly, mountains of compliance paperwork can often benefit large companies because it prevents small competitors from ever getting started—the little guys don’t have the lawyers and accountants needed to comply with Washington’s regulatory nightmares.  Representatives and Senators know that businesses benefit from regulations, and they’ll work to see that other regulation get repealed before those that help their constituents.

We can get around this political reality  by creating a deregulatory commission that would pour through the federal register and would then recommend large slates of regulations to be cut.  Just like BRAC, this comission could  force Congress to vote Yes or No.

Deregulation wouldn’t result in income loss for the federal government, it would clear the books of many dead-weight, no-gain rules, and would get the economy chugging along more efficiently.  This is exactly what America needs.  This, combined with lower income taxes and a much lower corporate tax rates, would be a far greater stimulus—and less open to corruption and playing favorites—than the spending boondoggle now before law makers in Washington.

The Dishonesty of Poltical Adjectives

by Fred Smith on January 19, 2009

in Culture, Politics as Usual, Sanctimony, Zeitgeist

Rhetoric is a noble field — the ability to use language skillfully to clarify and justify a policy. But the political use of language is often used In a far less honest fashion. Consider the language of some policy positions advanced today:

Fair Trade: No one likes to be seen as a protectionist.  Protectionism—the idea that a nation should help its own industries by taxing their foreign competitors—is now widely viewed as a discredited policy.  This is largely due to the failures of protectionism’s past, like the Smoot-Hawley Tariff policy which exacerbated the suffering of the Depression and was one of many causes of WWII.

Thus, modern protectionists favor trade that is “fair.”   This term signifies that voluntary exchanges between individuals is only justified if it meets the criteria of a wide array of other interests such as labor, human rights advocates, internationalists, environmentalists, religious advocates, or feminists. These other goals may be legitimate but if this criteria is used only trade approved by Greenpeace, Amnesty International, the AFL-CIO, the Christian Coalition, and NOW would be allowed. Few trading arrangements could meet the utopian demands of these disparate groups.   Thus, “fair” trade is another way of arguing for protectionism.

Safe Nuclear and Clean Coal: Americans believe that energy should be accessible and that the poor should not be shouldered with unnecessary costs.  Thus, those opposed to energy development allege that they favor expanded use of nuclear power — as long as it is “safe”, greater use of coal power as long as it is “clean.”

But there are no “safe” energy sources (only “safer” ones) and no “clean” sources of power.   Even the cleanest and safest processes for creating anything have some risks and some waste associated with them.  So, if we’re being honest, there are only really “safer” and “cleaner” methods than those now in use.  Environmentalists and others seeking restrictions on American energy (and thus higher prices) use the absolutes—”safe” and “clean”—  which are very deceptive qualifiers.

Green Jobs: A capitalist economy seeks to employ people to meet human needs and job creation is very politically popular. However, some environmentalists and others would focus job creation efforts on employment in those areas which would advance their anti-development aims — thus, “green” jobs.

Social Justice: We all favor “justice” but, as Friedrich Hayek noted long ago, “social” is a weasel word designed to weaken this core value of any moral civilization into a tool of redistributive policy. According to “social justice,” creating wealth and knowledge is irrelevant unless such achievements also increase income equality.

One professor was told by one of his Canadian students that he could never migrate to America. “How,” he asked, “could anyone live in a world with such a poor GINI (a measure of income dispersion) value?”

That those income differences (like the prizes granted athletes and others) might increase general welfare is viewed as secondary.

Political discourse would be more transparent and honest if such deceptive adjectives were banned.

Land Grab Bill: Senators Check Principles at the Door

by Myron Ebell on January 17, 2009 · 1 comment

in Energy, Environment, Politics as Usual

I have heard several Republican congressional leaders say that the party has learned its lesson from their disastrous losses in the past two elections. From now on, it’s back to being the party of limited government, fiscal discipline, lower taxes, and against pork barrel spending.

Sounds good, but Senate Republicans have blown their first opportunity to demonstrate that they mean what they say. The first bill that Senate Majority Leader Harry Reid (D-Nev.) brought to a vote in the 111th Congress is the omnibus land grab bill that was blocked in the waning days of the last Congress by Senator Tom Coburn (R-Okla.). It was re-introduced by Senator Jeff Bingaman (D-NM), Chairman of the Energy and Natural Resources Committee, as S. 22. It contains around 160 titles. Lots of new National Parks, Wilderness Areas, Wild and Scenic Rivers, National Trails, and National Heritage Areas. Plus making official a whole new designation of public land lockups for the Bureau of Land Management called Areas of Critical Environmental Concern. And withdrawing 1.2 million acres from the Bridger-Teton National Forest in Wyoming from future oil and gas production–an area with high gas potential.

The Senate voted on Thursday 73 to 21 to pass this monstrosity. Twenty-one Republicans voted against it, but nineteen Republicans (and all 54 Democrats who voted) voted for it. This first vote suggests that it’s going to be business as usual for many Republican Senators in the 111th Congress. Talk about shrinking government and reducing federal spending. Talk about increasing domestic energy production. Talk about stopping pork barrel spending. And then vote the other way.

The twenty-one Senators who voted against S. 22 were:
Brownback (Ks.), Burr (NC), Chambliss (Ga.), Coburn (Okla.), Cornyn (Tex.), DeMint (SC), Ensign (Nev.), Graham (NC), Grassley (Ia.), Hutchison (Tex.), Inhofe (Okla.), Isakson (Ga.), Johanns (Neb.), Kyl (Az.), McCain (Az.), McConnell (Ky.), Roberts (Ks.), Sessions (Ala.), Shelby (Ala.), Thune (SD), and Vitter (La.). They should be congratulated.

If you hear any of the nineteen Republicans who voted for the land grab bill talk about getting back to the basic conservative principles of less government, lower spending, and protecting property rights, have a good laugh.

S. 22 now moves to the House of Representatives.

$6 Billion For Broadband, Or How I Learned To Stop Worrying And LOL At The Recovery Act

by Nick Brown on January 16, 2009 · 5 comments

in Economy, Stimulus to Nowhere, Tech & Telecom

Speeding its way across the Internetz today are copies of the American Recovery and Reinvestment Act of 2009. Eager policy analysts, lobbyists, and grassroots organizations all over the country are scouring its 258 pages as we speak. As a tech policy analyst who is very interested to see what was going to happen with the Promised One’s Broadband Stimulus plan, I too dove into the fine reading that my giant PDF copy of the proposed act would provide.

Prior to my study of the bill, as I sent the document to my printer, visions of the sorcelations such a mighty plan might bring wrought both excitement and fears for the future of the Internet. I grabbed the freshly printed document from the copier, my fingertips brushing the pages and sending chills that delivered the grandeur of the most daring broadband project ever conceived on the face of our planet to my mind’s eye. The thought was both intriguing to see how such a plan would be delivered, and brought with it the scourge of the possibility of enforced government regulation, and implementation of mandatory net neutrality policy via acceptance of the funds by the bidding project companies.

I returned to my desk and began reading. I read it. Then I read it again.  (The section on broadband is very short, especially for a plan that will, “get true broadband to every community in America“.)

And that’s when I started to LOL.

$6 Billion. That’s it. $6 Billion to increase broadband penetration to the “underserved” part of America. Current penetration of broadband in this country is just over 25%, connecting roughly 71 million Americans to high-speed Internet. Most of these individuals live in areas where they have access to readily available sophisticated networks. Obama’s broadband stimulus is for rural areas; areas where many companies have avoided going because the problems getting broadband in those areas are not miniscule and will cost more money to develop than in populated regions where an infrastructure backbone is present.

So let’s put this into perspective. AT&T announced roughly a year and a half ago that it underestimated its U-Verse project that uses fiber-to-the-node and fiber-to-the-point technology.  They now estimate it will run them $6.5 Billion. Verizon, who many feel is keeping their true costs for their FiOS service out of the press, announced publicly back in 2006 that they anticipated spending $18 billion to connect 7 million customers nation wide with fiber.

$6 billion to reach a vast and widespread audience with broadband in the distinct regions and rural areas in this country is a laugh. Additionally, the funding is actually broken down even farther.  $2.825 billion is focused on rural area business development.  Another $2.825 Billion is focused on rural wireless and broadband; $1 billion of which is aimed at wireless deployment, with the remaining $1.825 going toward broadband deployment.  The final $350 Million of the $6 Billion will go to the State Broadband Data and Development Grant program established by the Broadband Data Improvement Act in October of 2008.

I cannot believe that this tiny allotment in the grand scheme, after it is spread thin over state projects, grants, and various companies awarded funds for infrastructure projects will even make a recognizable dent in the state of broadband here in the US.  And this is not even to mention the sneaky requirement to enforce the FCC’s broadband policy statement by accepting the funds; essentially sneaking in net neutrality policy light into the mix.  This, of course, along with the requirement for any network built with these funds to be open access, and how that will affect the nature of other networks is a bigger question.  But ultimately, I would argue that based on what we are seeing in the act, that these funds would probably just be better suited going somewhere entirely different…preferably back in the tax payers pocket.

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