January 2012

The TSA Can’t Help Being Annoying

by Ivan Osorio on November 15, 2010 · 2 comments

in Mobility, Politics as Usual, Regulation

With the holiday travel season approaching fast, public anger at the federal Transportation Security Administration’s (TSA) increasingly invasive airport passenger screening procedures — full body scans and pat downs — seems to be growing louder by the day. Homeland Security Secretary Janet Napolitano argues that these measures are necessary to maintain an adequate level of security for the nation’s air travel.

Indeed, some types of safety measures, including passenger screening, are needed for air travel safety. The problem with the current security regime is its structure. In a way the TSA can’t help annoying travelers with petty, intrusive rules. It is in its nature, as a top-down, government regulatory bureaucracy. By design, it’s good at promulgating and enforcing rules, not so much at turning on a dime to react quickly to potential threats, which have an annoying habit of turning up unexpectedly and be ever shifting.

Hopefully, the public anti-TSA backlash can lead to greater public debate over the nature of government institutions and the incentives they face, compared to those in the private sector. At Forbes, Rhodes College economics professor Art Carden launches a strong early volley in this debate, arguing for abolishing the TSA.

But won’t that compromise safety?  I doubt it.  The airlines have enormous sums of money riding on passenger safety, and the notion that a government bureaucracy has better incentives to provide safe travels than airlines with billions of dollars worth of capital and goodwill on the line strains credibility.  This might be beside the point: in 2003, William Anderson incisively argued that some of the steps that airlines (and passengers) would have needed to take to prevent the 9/11 disaster probably would have been illegal.

This makes me wonder, as I often have, of what exactly goes through the mind of Naderite self-styled safety advocates when they advocate some new “safety” requirement. Do they really believe that companies have no economic self-interest in helping protect the safety of their customers? An auto manufacturer whose vehicles can’t withstand accident impacts or a restaurant where people routinely get food poisoning won’t stay in business for long.

That kind of failure to account for incentives underlies a lot of economic fallacies. It also distorts the political debate, by making possible the notion that taking an activity out of the marketplace somehow obviates any self-interest surrounding it. In fact, government intervention simply shifts self-interest from the voluntary exchange of the market to the coercive functions of government. The TSA debate is no different, as Washington Examiner columnist and former CEI Warren Brookes Fellow Tim Carney notes:

If you’ve seen one of these scanners at an airport, there’s a good chance it was made by L-3 Communications, a major contractor with the Department of Homeland Security. L-3 employs three different lobbying firms including Park Strategies, where former Sen. Al D’Amato, R-N.Y., plumps on the company’s behalf. Back in 1989, President George H.W. Bush appointed D’Amato to the President’s Commission on Aviation Security and Terrorism following the bombing of Pan Am Flight 103. Also on Park’s L-3 account is former Appropriations staffer Kraig Siracuse.

The TSA isn’t probably going away any time soon. However, the backlash can bring about some needed changes, in addition to introducing more questions about the role of government into the public debate — all the while air travel becomes even more unpleasant.

Debunking the Abner Doubleday Myth: Baseball as Spontaneous Order

by Ryan Young on November 15, 2010

in Culture, Odds & Ends, Zeitgeist

It turns out that Abner Doubleday did not invent baseball. The true story of the game’s origins is actually quite mundane — it evolved over time as a messy, Hayekian spontaneous order. No one person can claim to have invented the modern version of baseball.

The story of how Abner Doubleday was given his mythical status, however, is immensely entertaining. Apparently it came from a crazy person — literally — who wrote a letter to the founder of Spalding sporting goods. Spalding spread the story because he wanted people to believe that baseball was a uniquely American game, invented by an American. People were eager to believe him; some still are.

Joe Posnanski tells the tale well, as he does with everything he writes. Read the whole thing. It will make you laugh, and you will learn something about how easy it is for tall tales to become accepted fact. Lessons abound for the public policy world.

Photo credit: kfcempress’s flickr photostream.

Sam Kazman on Cigarette Warning Labels

by Marc Scribner on November 15, 2010

in Nanny State, Personal Liberty, Precaution & Risk, Regulation, Video

[youtube:http://www.youtube.com/watch?v=IaNCeIN0Ka8 285 234]

12 Ridiculous Regulations

by Ryan Young on November 15, 2010

in Deregulate to Stimulate, Regulation

Business Insider has a list of 12 of America’s most ridiculous regulations. Many of them have been covered on this site. But some of them haven’t, including:

  • In Texas, computer repair technicians are required to get a private investigator’s license.
  • In Milwaukee, it is illegal to close a business without a license. Closing businesses must also pay a tax of $2 for every $1,000 of inventory intended to be sold in a going out of business sale.

Photo credit: CPA Ireland’s flickr photostream.

TSA versus America

by Brian McGraw on November 15, 2010 · 21 comments

in Nanny State, Personal Liberty

The TSA doesn’t have very many friends these days. Do they deserve any?

In an interview (halfway down on the left sidebar), John Pistole (TSA director) was pressed twice at why the gentleman from San Francisco was told that he might be subject to a $10,000 fine for his unwillingness to go through with new invasive security procedures. He dodged this question both times it was asked, despite it being critically important for him to acknowledge how outrageous this type of fine would be.

For a background on what happened, you can read an account here. According to Tyner, he had looked at the San Diego Airport’s website ahead of time, which didn’t indicate that they were using these scanners. He didn’t feel comfortable using them and it seems he might not have made his trip (or driven instead, etc.) if he knew he would be subjected to the scanners.

So, when he was selected for the scan, he refused, then refused the pat-down when he found out the TSA agent would be patting down his private parts. The recurring attitude featured by the TSA, etc., here is that the peasant-citizenry should have no qualms with the enlightened technocrats and their unfortunate but necessary intrusion into the privacy of everyday Americans.

Even if you accept the premise that these technologies are necessary to keep our flights safe (which many people don’t), it doesn’t follow that he has violated any sort of reasonable law. He didn’t believe the benefits of his vacation outweighed the costs of his loss of privacy, so he “accepted” not being allowed to fly. What is the point of also attempting to fine him $10,000 other than bullying other Americans towards acceptance of these new procedures?

Many free-marketeers have suggested the U.S. would benefit from returning to non-nationalized airport security. It certainly makes sense — after all, airlines stand to lose a lot of money if anything goes wrong on their planes. In a security game that involves keeping up with ever-changing terrorist threats (i.e., 10 years ago, we could wear shoes and not need to buy new contact solution every time we left town), I trust the profit-seekers over the government to find an appropriate balance between consumer demands for privacy and airline security.

Is the TSA capable of finding that balance? Here is the TSA patting down a three-year-old. They also require pilots to go through the same security procedures (remember, pilots have the ability to steer planes into buildings), who undoubtedly already go through long background checks before they become licensed pilots.

Photo credit: jello2594′s flickr photostream.

Fiscal Commission Should Support Increased Energy Production, Not Increased Energy Taxes

by Ben Lieberman on November 15, 2010

in Agenda for Congress, Deregulate to Stimulate, Energy, Natural Resources

Among the many suggestions in the Fiscal Commission’s draft report is a 15 cents-per-gallon increase in the federal gasoline tax. No doubt, this proposed tax hike would raise revenues and make a modest dent in the deficit, but it would do so at the expense of the driving public and would disproportionately burden low-income motorists. There’s a better way. If raising energy-related revenues is the goal, why not fill federal coffers in a manner that actually reduces the price at the pump? Washington can accomplish this by allowing more oil drilling.

The federal government controls all offshore areas beyond three miles from the coast as well as vast expanses of energy-rich western lands. Unfortunately, only a fraction of these areas have been opened to energy leasing, due to legislative and regulatory restrictions. For example, a 2008 Department of the Interior report notes that only 8 percent of the estimated 31 billion barrels of oil beneath federal lands is fully available for leasing, while 30 percent is subject to significant restrictions and 62 percent is entirely off-limits. America’s offshore areas hold even greater potential but are also constrained. No other energy-producing nation on earth has limited itself to this extent.

Even with these restrictions, revenues from new energy leases reached $10 billion dollars in 2008. However, the Obama administration has thus far cracked down on domestic energy leasing, which helps explain why leasing revenues dropped below $1 billion in 2009 and don’t look to be much higher in 2010.

The up-front money the highest bidders pay to win these leases for offshore or onshore drilling rights is only the first installment in the payoff to the federal treasury. The energy companies also pay annual rents on each lease, and unless they hit a dry hole they must pay royalties of up to 18.75 percent on every barrel of oil and cubic foot of natural gas produced. Royalty revenues vary with energy prices as well as production levels, but have exceeded $9 billion in several recent years. With more leasing, royalty revenues would go up in the years ahead as new wells come online and start producing oil and natural gas.

Even more significant than the leasing and royalty revenues are the potential tax revenues. Energy company profits are subject to the federal corporate income tax as well as other levies — and the more energy produced the higher the taxable income.

Overall, the extra federal revenues from a judicious expansion in domestic energy production could easily reach into the tens of billions annually, quite possibly eclipsing the $25 billion or so from the proposed 15 cent per gallon gasoline tax increase. But contrary to a tax hike, allowing additional supplies of domestic oil to come online would lower gasoline prices, as well as those for natural gas and heating oil.

It would be an understatement to call increased domestic drilling a win-win situation. Compared to the proposed gasoline tax, it would be win-win-win. While raising federal revenues in a way that reduces energy costs, it would deliver yet another benefit no tax increase could provide – job creation. One study estimates a potential gain of 270,000 energy industry jobs from expanded offshore leasing.

Bills like the No-Cost Stimulus Act (S. 570 and H.R. 1431), The American Energy Innovation Act (H.R. 2828), the American Energy Act (H.R. 2846), the American Conservation and Clean Energy Independence Act (H.R. 2227), and others seek to reap the multiple benefits from enhanced production of American energy. All would serve as a good blueprint as the next Congress continues the look for solutions to high deficits, high energy prices and high unemployment.

Photo credit: christiannealmcneil’s photostream on flickr.

Quantitative Easing Explained (Video Comedy)

by Lee Doren on November 15, 2010

in Bailout Watch, Economy

Sometimes humor is better at explaining economic concepts than wonkish theory. Below is an interesting video regarding quantitative easing. Although it may place too much blame on companies like Goldman Sachs, it does a pretty good job describing the the corruption and absurdity that takes place with monetary policy in the United States.

While it is argued that the Federal Reserve must be entirely separate from politics in order to utilize independent judgment for its policy, often conflicts of interest appear to play a role nevertheless.

Enjoy and take this video below with a grain of salt.

Be Thankful for BPA-Lined Canned Goods this Thanksgiving

by Angela Logomasini on November 15, 2010

in Health and Illness, Precaution & Risk, Regulation

Well-meaning environmentalist Mindy Pennybacker, author of Do One Green Thing: Saving the Earth Through Simple, Everyday Choices, offers some sagely foolish advice today on Huffington Post.  She says, “This Thanksgiving, I’d rather have a can of worms than canned food with Bisphenol-A! At least worms make fertile soil. BPA, it appears, just makes us fat and infertile.” Accordingly, don’t eat canned food because containers are lined with BPA-based resins.

No thanks. I’ll stick with the BPA. I hope Pennybacker enjoys those worms with her holiday meal.

BPA — which is short for bisphenol A — is a chemical manufactures have used for 60 or so years to make hard plastics and resins used in food packaging without ever being traced back to any actual health problems. Ms. Pennybacker attempts to support her claims by citing a study that reports an association between BPA and human diabetes, as well as a study on pregnant mice.  Associations don’t show cause and effect and are often accidental; and humans and mice metabolize BPA very differently.  She doesn’t note that many scientific panels that reviewed the full body of research — such as the recent European Union review update — report no problems with BPA.  Yet that doesn’t stop such silly claims about its effects, nor does it stop the many calls for regulation.

The author does temper her folly with a note that we need not “fret” too much about BPA because human exposures from food packaging are well below what EPA considers safe. So then, why does she need to hype the risk at all? She goes on to note that exposures come from other things, like store receipts. Such exposures are not a concern according to the World Health Organization and the overwhelming exposure is from ingestion of food products. And even if you ate your store receipts, it is doubtful BPA would be a problem because humans (unlike mice) metabolize and pass BPA before it could cause problems.

Let’s not forget why we use BPA: It has many benefits! This Thanksgiving, I am going to be happy that the cans my cranberry sauce came in were lined with a resin made with bisphenol-A because it greatly reduces the chance that those cranberries will have been contaminated with botulism or some other dangerous organisms.  It also keeps my food free from rust, which would otherwise detract from the fruit flavors.

The benefits of BPA are just one thing for which I am thankful this year. In addition to good health and family, I am thankful for the freedom that makes America great. That includes the freedom to innovate and enjoy the results of that effort, be it BPA or some other helpful product that makes life better, safer, and more enjoyable. I fear those who would take those freedoms away.

Image credit: LarimdaME’s photostream on Flickr.

Morning Media Summary

by Lee Doren on November 15, 2010

in Economy, Energy, Environment, Legal, Personal Liberty, Regulation, Trade

Tech:

University Begins Reporting All P2P Users to the Police:
“Georgia’s Valdosta State University has updated its network with software that can pinpoint students who use P2P software. The university is committed to stop file-sharing on its network even if that results in prison sentences for students. Offenders will be disciplined by the school and then handed over to the police, the university has announced.”

Google’s growth online reflected by expansion in Mountain View:
“Google’s aggressive online growth increasingly has a counterpart in bricks and mortar, with the company’s Mountain View headquarters mushrooming in the past four years to occupy more than 4 million square feet, or the equivalent of about 40 Home Depot stores.”

Global Warming / Environment / Energy:

A suggestion to Dr. James Hansen: go protest coal in China:
“You see, Dr. Hansen of NASA GISS, has been using his position to protest the use of coal in America. That’s certainly his right. But, since his concern is global CO2 produced by coal, is he really being effective by protesting here? It seems that he should think locally, but act globally. Have a look at this graph and see if you think he’s making any difference in the places coal is being used the most:”

Alternative Headline: Guy wastes power to protest wasting power:
“The “Power Eater” is a public art piece that takes the shape of a giant igloo made from 312 refrigerators in the middle of Hamburg. Inside, there’s a “tower of consumption,” by artist Esa Ott, made from gadgets such as fans, TVs and toasters all plugged in and draining electricity. A nearby meter measures the total electrical requirement of the “Power Eater.””

Insurance / Gambling:

ChiliPoker Set to Show US Online Gambling Laws Are a Joke:
“The US government continues to keep prohibition of online gambling in place in the country, meanwhile, other countries have moved towards regulating the billion dollar industry. Now, as the prohibition continues, ChiliGaming is about to show once again just how ridiculous the current US laws are.”

Health / Safety:

FoodPolitik: Hypocrite Bloomberg behind latest salty Big Apple campaign:
“So here’s my question: Is New York City challenging San Francisco as the capital of Nannyland?”

San Francisco mayor vetoes happy meal ban:
“Despite Newsom’s opposition, the law may still end up on the books. The board passed it on an 8-3 vote Tuesday, the minimum needed to override a veto. An override vote has not been scheduled.”

Doctors brace for possible big Medicare pay cuts:
“Breast cancer surgeon Kathryn Wagner has posted a warning in her waiting room about a different sort of risk to patients’ health: She’ll stop taking new Medicare cases if Congress allows looming cuts in doctors’ pay to go through.”

Economics:

Secret Walmart Survey Shows Inflation Already Here:
“A new pricing survey of products sold at the world’s largest retailer showed a 0.6 percent price increase in just the last two months, according to MKM Partners. At that rate, prices would be close to four percent higher a year from now, double the Fed’s mandate.”

Losses double for U.S. Postal Service:
“The U.S. Postal Service more than doubled its losses in fiscal year 2010, despite cutting billions of dollars in expenses and trimming its staff.”

USPS puts significant blame on shift to online communication for $8.5 billion loss:
“The U.S. Postal Service announced Friday that it lost $8.5 billion dollars this fiscal year and blamed its financial problems on a significant decline in mail volume. The USPS operates off the revenue it generates from stamps and shipping costs, though it also has a $15 billion line of credit with the U.S. Treasury.”

White House Staffers Got a Bigger Raise Than You Did Last Year:
“Did you get a raise last year? Seventy-four percent of White House staffers did, according a Gawker analysis of the White House’s annual salary reports to Congress. Probably for the great job they’re doing with the economy.”

Legal:

Airport body-scan radiation under scrutiny:
“They’re arriving at airports across the country. Some complain they are invasive and an assault on our privacy. But are body scanners at security checkpoints dangerous?”

Full Frontal Nudity Doesn’t Make Us Safer: Abolish the TSA:
“The Republicans control the House of Representatives and are bracing for a long battle over the President’s health care proposal. In the spirit of bipartisanship and sanity, I propose that the first thing on the chopping block should be an ineffective organization that wastes money, violates our rights, and encourages us to make decisions that imperil our safety. I’m talking about the Transportation Security Administration.”

TSA encounter at SAN:
[These events took place roughly between 5:30 and 6:30 AM, November 13th in Terminal 2 of the San Diego International Airport. I’m writing this approximately 2 1/2 hours after the events transpired, and they are correct to the best of my recollection. I will admit to being particularly fuzzy on the exact order of events when dealing with the agents after getting my ticket refunded; however, all of the events described did occur.

Tobacco commission reforms needed, Baliles says:
“Former Gov. Gerald L. Baliles says it’s time for Virginia to act on reforms his blue-ribbon panel recommended for a state commission that was defrauded of $4 million in tobacco-settlement money meant to improve education in the state’s struggling tobacco belt.”

Labor:

Rough road ahead for Obama, unions as compromises loom:
“President Obama and labor unions are entering a new and difficult stretch in their relationship as the White House looks to find common ground with Republicans on issues like trade and the deficit.”

Unreal. SEIU Local 25 and 12 Other Unions Receive Obamcare Waivers:
“The Obama Administration recently handed out 111 Obamacare waivers to special US companies… And, they’re hiding this from the American public. It takes 6 clicks to find out this information on the government’s health care website.” (Listed here: http://www.hhs.gov/ociio/regulations/approved_applications_for_waiver.html)

Transportation/ Land Use:

Activists to rally in favor of Wis high-speed rail:
“Labor activists and supporters of high-speed rail are planning a rally in Milwaukee in favor of the imperiled project.”

High-speed rail forum looks at future:
“Politicians, business leaders, urban planners and academics converged on New York City Monday for a two-day symposium on the state of efforts to upgrade America’s train infrastructure and make high-speed rail a reality.”

Maryland Considers Privatizing Liquor Sales

by Michelle Minton on November 13, 2010

in Deregulate to Stimulate, Economy, Nanny State, Personal Liberty, Regulation

The only place residents of Montgomery County, Maryland, can purchase liquor is in county-owned stores, which until recently were only open six days a week. However, some big changes might be on the way for Montgomery.

Beginning on November 21st the county will run a pilot program, allowing the county’s 24 county-owned stores to remain open on Sundays for the next six months to test the waters (translation: to see how much money they can bring into the county). The move has private stores up in arms — claiming that now they’ll have to compete with government-run stores and lose revenue and customers as a result. According to Scott Yates, whose father owns Olney Beer and Fine Wine:

“It will hurt us pretty bad,” he said. “Sundays are part of the weekend. We sort of look forward to that day and them being closed, when we can do business and not worry about competing with [the county].”

Rather than opposing Sunday sales, Montgomery County alcohol outlets ought to be supporting the closure of the county-run stores; a proposal that just might be under consideration.

According to the Rockville Patch, County Executive Ike Leggett — the same official that ordered the six-month Sunday sale pilot program — is considering completely privatizing liquor sales in the county.

While his comments were very tentative, it should give Montgomery County store owners a legitimate target: end county sales: “Leggett said he would ask the Department of Liquor Control to study the privatization issue and the pros and cons of Sunday sales after the six-month Sunday sales trial concludes in May.”

The county currently collects around $28 million in profit each year from liquor sales and any privatization plan will likely attempt to protect that revenue. If liquor store owners in Montgomery County don’t want to compete with government-run stores, they should get on board with privatization in their county and the greater D.C. Metro area.

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