Cities around the nation are spending thousands in taxpayer dollars to promote tap water because of the alleged environmental problems with bottled water. But these campaigns just go to show how silly the issue has become. Minneapolis recently dropped $75,000 just to build a website encouraging people to drink only tap water. A college kid probably could have put up a site just as useful with a few hundred bucks. But governments are not that efficient! The site is part of a total $180,000 paid to a public relations firm to address this “pressing” issue. Why does Minneapolis need this campaign? Because their tap water stinks—literally! It comes from the Mississippi River and sometimes during the spring, purification techniques are not sufficient to clean out certain odors and flavors probably from algae that grow at that time of year. City officials say it’s not unsafe, but people surely can tell it doesn’t taste good. And no government taxpayer-dollar funded PR campaign can change that. Why not try a market solution? Let people drink bottled water, and don’t nag them for making that choice. After all, much of the information on government sites complaining about bottled water is simply self-serving propaganda anyway.
For some details watch this news report below.
Photo above: Mississippi River, drinking water source for Minneapolils; source is adamsfelt photostream on Flickr.
Not all stimulus programs are created equal. If the goal of the latest economic bailout package that Congress is considering is as President Elect Obama has declared, job creation, there is a significant disparity between many of the programs. While only 39 of the variously appropriated federal programs even attempt to quantify the number of jobs that they would create, there is a huge disparity in how effective various programs are at job creation — ranging from $1,000,000 per job created down to $16,000 per job created.
For a bill that is designed to stimulate job creation, it is disgraceful that Congress would appropriate any money for programs where the agency has not even attempted to estimated the number of jobs that the appropriation would generate. For the few programs that have estimated the number of jobs created there are obviously some that are economically more efficient than others. And Congress should certainly direct resources to those programs that would maximize the job benefit for the buck. At a minimum, Congress should focus on those programs that are more rather than less efficient. If a program cannot even estimate the number of jobs that if would create, that program certainly doesn’t qualify for emergency economic recovery legislation. Congress should insist on knowing how many jobs a program is estimated to generate before appropriating huge sums of American taxpayer dollars.
Here is a list of programs from the stimulus bill and the estimated cost per job.
The Bush administration’s outline of its automaker bailout package lists some seemingly sensible changes in labor practices that GM and Chrysler need to make. (Ford, to its credit, is seeking private financing instead.)
Targets: The terms and conditions established by Treasury will include additional targets that were the subject of Congressional negotiations but did not come to a vote, including:
Reduce debts by 2/3 via a debt for equity exchange.
Make one-half of VEBA payments in the form of stock.
Eliminate the jobs bank.
Work rules that are competitive with transplant auto manufacturers by 12/31/09.
Wages that are competitive with those of transplant auto manufacturers by 12/31/09.
But…
These terms and conditions would be non-binding in the sense that negotiations can deviate from the quantitative targets above, providing that the firm reports the reasons for these deviations and makes the business case to achieve long-term viability in spite of the deviations.
Conditions with a loophole wide enough to drive a GMC truck through are hardly the stuff of which corporate transformations are made. To be fair, the Bush administration has recognized the biggest labor-related problems affecting these companies, so it is particularly unfortunate that it is being this timid.
The requirement to pay contributions to VEBAs (voluntary employee benefit associations) draws welcome attention to a looming problem. VEBAs are intended to serve as health care trusts that allow companies to pass their health insurance obligations on to another party, in this case a union. It makes sense for a company to want to shed those costs, and GM has already passed $35 million on to the United Auto Workers.
But, as Brian Johnson and Ryan Ellis of Americans for Tax Reform point out:
[T]he United Auto Workers has been given a free hand to define “health care” under the Treasury regulations—not coincidentally written by IRS officials of Presidents Lyndon Johnson and Jimmy Carter—which implement VEBAs.
Payments in the form of stock would at least help make VEBAs less liquid and thus prone to abuse — but even then, the requirement is only for half of payments, and is only a non-binding target for use of taxpayer money.
Finally, handing a large union a large wad of cash requires holding the union to a high standard of accountability, something for which President-elect Obama’s pick for Labor Secretary doesn’t provide confidence.
Freddie Mac & Fannie Mae were the catalyst for our current financial crisis. By buying up risky sub-prime mortgages, Freddie & Fannie encouraged banks to make risky loans to folks who otherwise wouldn’t have received mortgages.
Freddie & Fannie did this because they had the backing of the U.S. Treasury. The executives at Freddie/Fannie knew that if they made a bad move and lost billions in the market, the government would bail them out.
This notion was laughed at a few years ago by Rep. Carolyn Maloney (D-N.Y) when Fred L. Smith, the president and founder of CEI, suggested that Freddie & Fannie might use more than their allotted line of credit at the Treasury. Maloney scolded Smith and said of what was then a $2 billion credit line:
It is really symbolic, it is obsolete, it has never been used,
Mr. Smith responded that it was still important to repeal any such promise of credit from the Treasury, stating:
As long as the pipeline is there, it is like it is very expandable. It is only $2 billion today. It could be $200 billion tomorrow.
Fred was wrong, but only because he underestimated. Freddie & Fannie took more than $300 billion of our tax dollars for their foolish decisions.
Now it seems that every bank in the country is backed up by the Treasury. Look no further than the Citigroup and its bailout. Citi has already received $7 billion in taxpayer dollars and will now receive a possible $300 billion more. This is sounding a lot like a sequel to Freddie Mac and Fannie Mae, and yet this is a private business, not a “government sponsored entity” like Freddie/Fannie.
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