January 2012

Civil Rights Commission Criticizes Obama Health-Care Plan’s Racially-Discriminatory Affirmative Action

by Hans Bader on August 12, 2009 · 2 comments

in Healthcare, Legal, Personal Liberty, Politics as Usual, Sanctimony

The U.S. Commission on Civil Rights says Obama’s health-care plan is racially discriminatory. The House health-care bill backed by Obama is filled with “sections that factor in race when awarding billions in contracts, scholarships and grants” and give “preferential treatment to minority students for scholarships.” Taxpayers of all races will end up paying more because of these arbitrary racial preferences. The Civil Rights Commission has concluded that this racial discrimination is unjustified, and that it will neither “reduce health care disparities among racial and ethnic groups,” nor “improve health care in underserved areas.”

Earlier, I wrote about other provisions backed by Obama that would mandate affirmative action in health care to promote “cultural competence” — whatever that means — and fund left-wing community organizers. “ObamaCare” also contains preferences for illegal aliens, who are exempt from its taxes and penalties, but can access its benefits due to lack of eligibility verification safeguards. The safeguards were blocked by liberal lawmakers allied with Obama.

Historically, affirmative action did not apply to health-care in general, only to employment, education, and government contracts, although Obama has advocated expanding it to health-care in his published writings. When critics of affirmative action passed state constitutional amendments banning racial preferences in California, Michigan, and Nebraska, they applied such bans only to “employment,” “education,” and “contracting,” because it never occurred to them that anyone would advocate affirmative action elsewhere. But Obama seems determined to go further than any other president in pushing affirmative action. In his 2006 book “The Audacity of Hope,” he advocated race-based “affirmative action” in the form of “targeted programs to eliminate existing health disparities between minorities and whites.”

Earlier, the Civil Rights Commission chided the Obama Administration for letting an Obama poll-watcher and Democratic official get away with racist voter intimidation against non-black voters in Philadelphia (even though they were caught on videotape wielding a nightstick and using racial epithets) and for backing a hate-crimes bill designed to allow people who have been found innocent of hate crimes in state court to be reprosecuted all over again in federal court.

One of Obama’s own advisers says the Obama Administration’s health-care plan will harm people with insurance while raising their taxes. ObamaCare will take away 5 important freedoms, notes a CNN commentary. It will also destroy many affordable health-care plans while breaking Obama’s campaign promises.

More alternatives to Obamacare

by Fran Smith on August 12, 2009

in Healthcare, Nanny State, Personal Liberty, Regulation

company-about

Lots of commonsense suggestions to rein in health care costs that won’t bankrupt the country in John Mackey’s op-ed in the Wall Street Journal today. Mackey, the CEO of Whole Foods, points to eight steps to health care reform that involve less government intervention and greater individual choice, while driving down costs.

Mackey’s recommendations are similar to those of Gov. Bobby Jindal and those of  Susanne Lomatch as outlined here.

Also enjoyed this quote framing Mackey’s article:

“The problem with socialism is that eventually you run out
of other people’s money.”

—Margaret Thatcher

Neutering the Net

by Jack O'Connor on August 12, 2009 · 1 comment

in Regulation, Tech & Telecom

The Washington Examiner has published my op-ed on net neutrality:

A war is waging over the future of the Internet. On one side are the supporters of “net neutrality,” a proposal to ban Internet service providers (ISPs) from giving different treatment to network traffic from different sources. The Internet Freedom Preservation Act of 2009, introduced in the House two weeks ago, is their latest salvo.

On the other side are those who believe that regulation will threaten the very freedom that has allowed the Internet to thrive.

The net neutrality movement is an unfortunate departure from the “keep your hands off my Internet” attitude long held by many on the Web. Advocates of neutrality legislation are asking Congress to write into law what they see as an Internet that treats everyone equally. They are concerned that new technologies and business models might give big players an advantage over the little guy, or worse, that ISPs might use their market power to force a crippled Internet on their customers. Both fears rest on significant misconceptions.

The Internet has never been a level playing field. Big companies like Google, for example, offer their customers an Internet “fast lane” by building server farms all over the world. Cable broadband providers still reserve most of their bandwidth for cable TV. Far from hurting the Internet, these non-neutral elements have been essential to pay for the wires and servers than carry the Web as we know it.

Neutrality is not an all-or-nothing choice. Different elements coexist and make each other better. Companies that take advantage of openness can wipe the floor with those who do not, as AOL’s competitors did in the late nineties. At the same time, if Google’s servers gave the company no advantage, Google would never have built them, and the Internet would be slower for everyone.

Future innovations will be just as helpful, if we allow them. ISPs might save their customers money by “unbundling” Internet access, as we often wish cable companies would. Or they might take a cue from mobile providers and let their customers choose “preferred sites.” Some of the strongest proponents of neutrality laws—Google, Amazon, and eBay—made their fortunes with the same “dynamic pricing models” that they want to deny to ISPs. No one could have predicted the diversity of prices and services that has made AdWords possible, and there is no reason ISPs and their customers cannot benefit from the same strategy.

Many neutrality advocates admit that non-neutrality could help the Internet, but they worry that ISPs will exploit non-neutrality to swindle their customers. Doomsayers warn that ISPs will start cutting users off from some parts of the Internet in exchange for bribes from powerful players. Neutrality advocates want to make these practices illegal, to stop the problem before it starts.

That theory has several problems. The first mark of a monopolist is price gouging, not shoddy service. There is no evidence that ISPs are gouging prices, and even if they were, net neutrality would do nothing to stop them. More importantly, though, if competition were lacking, neutrality laws could only make the problem worse.

It is nearly impossible to compete directly with a powerful company. Instead, competitors try to enter the market by offering something new, like Progresso did with upscale canned soup or Apple did with the iPhone. Yet the goal of neutrality legislation is that ISPs should compete only on price. By forcing new companies to use the same business model as the big dogs, the law would make competition much more difficult.

Many advocates answer that ISPs will never be competitive, and that the best we can hope for is to regulate them. In fact, that is exactly what regulators thought in the 1920s, when the Bell telephone monopoly was just taking off. They assumed that competition had no chance, so they ignored the anti-competitive effects of their rules. Those mistakes choked the telephone industry for decades.

Competition is not perfect. It never has been and never will be. But assuming that we can do without it, that we can help consumers by prohibiting diversity, is a blunder too costly to make again.

The Internet is a process in motion. New sites and applications come and go in the blink of an eye, and that dynamism has created a wealth of content like nothing ever before. We cannot expect anything less of the technologies that carry that content, or of the businesses that pay for those technologies. They too must come and go and change as the Internet grows. The Web should not rely on one unchanging business model any more than it should run on just one browser.

We had it right the first time. Congress, keep your hands off!

UBS-IRS deal — U.S. Constitutional liberties, privacy rights at risk after Obama bullies the Swiss

by John Berlau on August 12, 2009 · 2 comments

in International, Mobility, Nanny State, Personal Liberty, Politics as Usual, Sanctimony, Trade, Zeitgeist

Lawyers for the U.S. government and the Swiss bank UBS AG have announced that they have reached a deal on releasing to the US the names of UBS account holders. No new details of the agreement have been released, other than what was previously speculated on a week ago.

 

I will be watching for and examining details that are released. Whatever deal is reached, the Obama administration’s conduct in the case, disregarding both privacy interests and the sovereignty of other nations, has been deplorable. It has set a precedent that could endanger U.S. competitiveness as well as civil liberties throughout the world.

 

As Fred Smith and I had explained in a Washington Times op-ed, after UBS, with the Swiss government’s full cooperation, turned over the names of 250 customers suspected of violating U.S. tax laws, the U.S. government turned around and asked for a whopping 52,000 names. The Swiss government objected to such a fishing expedition as violating the nation’s privacy laws. 

 

Switzerland rightly argued that such a large volume of names could not be justified by probable cause or “reasonable suspicion,” a condition of the tax treaty Switzerland had negotiated with the U.S. In addition, such a fishing expedition goes against the spirit of the Fourth Amendment of the U.S Constitution, which protects Americans from “unreasonable searches.” A forensic analysis commissioned by UBS from Alix Partners (scroll down the right side of this page to open the PDF) found that many international students, diplomats, and Americans who work in Switzerland – and banked in Switzerland by necessity — could have been swept up in this dragnet.

 

It’s far from clear if the shoe were on the other foot, and a foreign country were to demand the names of 52,000 customers of an American bank, the U.S. would have complied. The United States Model Income Tax Convention of 2006, used as a template by the U.S. to negotiate tax treaties, states that no country should be required to honor “a request in which a Contracting State simply asked for information regarding all bank accounts maintained by residents of that Contracting State in the other Contracting State, or even all accounts maintained by its residents with respect to a particular bank.”

 

Previous reports had indicated that UBS would surrender 5,000 names, a large amount but still less than a tenth of what the U.S. had originally called for. It will be important to scrutinize if there is indeed “reasonable suspicion” for however large the volume of names that are released. American civil liberties advocates on whatever side of the political fence should be alarmed by the U.S. government’s sweeping disregard of privacy interests in its demands to the Swiss, and should encourage their home country to never treat privacy and another country’s sovereignty so cavalierly again.

Smart Is As Smart Does

by Iain Murray on August 12, 2009 · 1 comment

in Energy, Environment, Global Warming, Mobility, Odds & Ends

This picture accompanying this post is doing the rounds on the internet.  The commentary normally reads:

Below is a photo of a wreck in Jefferson Parish, LA (near New Orleans ) between two
trucks and a Smart Car. Think Il (sic) pass on the Smart Car.

As with any email circular, especially ones with egregious spelling errors, you should always take it with a pinch of salt.  The goldmine that is snopes.com says the following:

According to a reader who relayed information to us from the Jefferson Parish Sherriff’s Office, the accident pictured above involved a Ford Escape not (as is commonly reported) a Smart Car.  The impact did not occure dead center as apparently shown in the photograph; it was offset to the right, and thus the driver’s side was not nearly as heavily damaged.  the driver of the Ford survived the crash and has since been released from the hospital.

So does this mean that a Smart car is safe and you should be happy if your son or daughter wanted to drive one?  Up to a point:

Ouch.

As Long As It’s Free

by Kevin Hilferty on August 12, 2009

in Odds & Ends

As reported in Business Week’s BTW section, the U.S. Chamber of Commerce recently studied the word associations people have with various free-market terms.

The results were not surprising; some terms that generally mean the same thing bring starkly different associations. The piece quotes Rich Thau, who ran the testing, as saying:

“There were those who associated ‘capitalism’ with greed and with the powerful dominating the vulnerable.” But those negatives, he says, didn’t apply at all to “free enterprise.”

Call it capitalism or free enterprise; to me it doesn’t matter as long as it’s free. But indeed, for full impact in convincing those on the fence, it probably does matter how you say it.

HT to Claire S. Forman at the Mackinac Center for Public Policy.

Regulation of the Day 30: Labeling Mustard

by Ryan Young on August 12, 2009

in Deregulate to Stimulate, Economy, Nanny State, Regulation, Regulation of the Day

If your company makes mustard bottles that are reusable as beer mugs, you are specifically required to put a country-of-origin label on your product.

Strangely specific, that one.

John Berlau on the future of GM

by Richard Morrison on August 11, 2009

in Video, Zeitgeist

[youtube:http://www.youtube.com/watch?v=Y-LDvpZNLW4 285 234]

Policy Peril Segment 7: Fuel economy standards

by Marlo Lewis on August 11, 2009 · 1 comment

in Global Warming, Mobility

Today’s excerpt from CEI’s film, Policy Peril: Why Global Warming Policies Are More Dangerous Than Global Warming Itself, is on two global warming policies Congress has adopted: fuel economy standards and biofuel mandates.

Here are my previous posts in this series:

To watch today’s film excerpt, click here. To watch the entire film, click here.

The text of today’s film clip immediately follows. It includes footnotes to additional commentary and supporting information.

Narrator: If stopping new coal is the global warming movement’s top priority, a close second is jump-starting a ‘beyond petroleum’ transport system. They propose to do this by tightening new-car fuel economy standards. Why?

A car that gets more miles to the gallon emits less CO2 per mile [1]. But the federal fuel economy program, also known as CAFE, has serious downsides.

Sam Kazman (General Counsel, Competitive Enterprise Institute): Now there are lots of problems with fuel economy mandates. One thing, they raise new car prices. [2] Secondly, they restrict consumer choice. [3] But the worst thing is an effect you never hear their advocates talking about. Namely, fuel economy mandates kill people. [4]

Narrator: Here’s why. Heavier cars provide more mass to absorb collision forces, and bigger cars provide more space between the occupant and the point of impact. [5] Make a car smaller and lighter, and it will go farther on a gallon of gas.

Kazman: But you also make it less safe. According to the National Academy of Sciences, the current CAFE standard by downsizing cars, contributes to about 2,000 fatalities per year. [6]

Narrator: Legislation Congress passed in December 2007  requires a 40% increase in fuel economy by 2020. [7] In 2007, only two out 1,153 vehicle models met the new standards. [8] So expect more downsizing in the years ahead.

Another ‘beyond petroleum’ policy is to require the sale of alternative fuels. In December 2007 Congress also mandated that motor fuel producers sell 36 billion gallons of ethanol a year by 2022, with 15 billion gallons coming from corn kernals. [9] The result, we’re diverting massive quantities of grain from food to auto fuel. This contributes to the surge in global grain prices that is pushing millions of the world’s poorest people to the brink of starvation. [10]

But at least ethanol cuts down on CO2 emissions, right? Actually, no.

Dr. Dennis Avery (Hudson Institute): As we expand the cropland, then we get into the real trouble, because we release the greenhouse gas that’s stored in the soil as carbon. And with corn, we release twice as much gas as we would have released if we burned gasoline in the first place. [11]

[1] A gallon of gasoline (which weighs about 6.3 lbs.) produces 20 lbs. of CO2 when burned. If a car gets more miles to the gallon, it will emit fewer lbs. of CO2 per mile driven. The relationship between fuel economy (mpg) and lbs. CO2/mile is so strict that EPA bases its fuel economy ratings of vehicle models on tests that measure the carbon content of the emissions, principally CO2.

Unsurprisingly, virtually all CO2-reduction options for new motor vehicles are fuel-economy-increasing options. See p. 10 of the National Automobile Dealer Association’s comment on EPA’s reconsideration of California’s request for a waiver to establish greenhouse gas emission standards for new motor vehicles. 

[2] There are basically two ways to increase fuel economy–downsizing (making cars smaller and lighter) and new technology. Typically, advanced technology costs more than conventional technology. The Energy Information Administration, for example, estimates that California’s greenhouse gas/fuel economy standards, which President Obama recently adopted, will increase the average price of a new car by $1,860 in 2016. [Obama's program will also impose heavy burdens on the nearly prostrate U.S. auto industry, as economist Keith Hennessey explains.]

[3] The CAFE program all but killed the market for large station wagons, because automakers could not produce millions of these once popular “family cars” and meet the CAFE standard for their vehicle fleets.

In addition, as a general matter, because fuel economy mandates increase vehicle cost, they inevitably price some consumers out of the market for certain vehicle models, restricting their choices.

Ironically, the federal fuel economy program boost the production and sale of gas-guzzling SUVs. Consumers who might otherwise have purchased big station wagons instead bought large SUVs. Congress regulated SUV fuel economy less stringently because (1) SUVs are built on a light-truck chassis and thus are classified as trucks rather than as passenger cars, and (2) most SUVs traditionally were used for farming and business rather than commuting. Fuel economy standards helped create the boom market for low-mpg SUVs–a classic case of the law of unintended consequences.

[4] Sam debates the issue of whether CAFE kills with an analyst from Natural Resources Defense Council (NRDC) here.

[5] I am always amazed when people with scientific credentials deny the safey implications of regulatory-induced vehicle downsizing. How can they claim that size and weight don’t matter? That’s denying the laws of physics. There’s a reason why boxing matches don’t pit lightweights against heavyweights, or why marathon runners don’t play professional football.

Yes, new technology can improve the crashworthiness of small cars. But, as Sam explains elsewhere, a large car with new technology will still be safer than a small car with new technology. To the extent that CAFE constrains the production and sale of larger, heavier vehicles, it limits auto safety.

[6] Sam refers to a National Academy of Sciences/National Research Council (NRC) study, Effectiveness and Impact of Corporate Average Fuel Economy (CAFE) Standards. See pp. 25-29, especially p. 27. The NRC estimates that in 1993, a typical year, downweighting and downsizing of cars contributed to 1,300 to 2,600 auto fatalities, 13,000 to 26,000 incapacitating injuries, and 97,000 to 195,000 total injuries.  

[7] The so-called Energy Independence and Security Act (EISA). Click here to read the Congressional Research Service’s summary of the EISA provisions.

[8] Prior to investigating, I had assumed there must be at least 30-50 models on the road that met the fuel economy standards mandated by the 2007 Energy Independence and Security Act. But EPA’s fuel economy ratings for model year 2008 reveals that only two out of 1,153 models, the Toyota Prius and Honda Civic Hybrid, met or exceeded the standard (35 mpg for both city and highway driving conditions).

[9] Click here to read the Congressional Research Service’s summary of the EISA provisions.

[10] I provide references here on biofuel policy and world hunger. In May 2008, the International Food Policy Research Institute estimated that biofuel demand accounted for 30% of the increase in world cereal prices during 2007-2008. For further discussion, see Dennis Avery’s October 2008 paper for the Competitive Enterprise Institute. 

[11] Dennis’s CEI paper recaps the literature on CO2 increases from biofuel policy-induced land-use changes, including Searchinger et. al. (2008) and Fargione et al. (2008). Additional reviews of these studies are available on World Climate Report and CO2Science.Org.

NCAA V. Delaware Sports Gambling

by Michelle Minton on August 11, 2009 · 3 comments

in Legal, Odds & Ends, Personal Liberty

Over the past few months the NCAA, along with the four major pro-sports leagues, has been a vocal opponent of Delaware’s attempts to legalize per-game sports gambling in the State. They were among the group of sports leagues that petitioned a federal judge to issue an injunction to stop the state. Like the pro-sports leagues, the NCAA believes that allowing gambling in the state will damage the reputation of college athletics and increase the temptation for players to cheat.

When the federal judge denied their request for the injunction the NCAA retaliated by establishing a new policy that prevents college championships from being played in cities that allow per-game gambling. Finally, the NCAA is acting appropriately-though the championship denial will do nothing to prevent cheating and little to nothing to stop Delaware from pursuing gambling on sports as a revenue source for the state.

Could legalized, licensed sports gambling increase the likelihood that cheating will occur? Possibly, but it’s not likely. As multiple scandals involving college athletes cheating, or getting caught up in gambling show, just because an activity is illegal does not preclude people-even athletes, from engaging in it anyway.

Of course, even if cheating, gambling, drug use, or any other behavior the NCAA finds unacceptable suddenly rises in occurrence, even if it can be directly correlated with the legalization of gambling, it is not the responsibility of the court system to ensure the integrity of private organizations.

As an independent association, the NCAA, like all the pro-sports leagues, is free to create any rules it wants and penalize members for breaking them. In order to get the prestige that goes along with participating in a league, members should conduct their activities to the leagues standards. If member do not abide by the league’s rules the image and prestige of the league suffers. That is the fear with legalized gambling on sports.

Sports leagues contend that increased gambling on their game could make it more likely, or at least, make it seem more likely that players will get involved in plans to throw games.  But as I wrote about last week, that problem is not for the American taxpayer, nor the American court system to remedy. It is up to the league to set up a framework to ensure that its members continue to operate within its standards. If they think banning championships in gambling states is the way to do this, so be it (no matter how unlikely to produce results that strategy is).

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