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Archive for the ‘Regulations’ Category

I’ve already commented here and here on the government forcing us to use inferior lightbulbs.

The bad news is becoming worse news. Here’s a story from England that was linked on Instapundit, showing how big business (which conspired with the politicians to get rid of high-quality incandescent bulbs) will now reap a windfall selling the new CFL bulbs at much higher prices. Here’s an excerpt from the Daily Mail.

The price of energy-saving light bulbs will treble as the final supplies of traditional bulbs dry up, industry experts have warned. The Government has ordered energy companies to scrap the subsidies that have kept the price of eco-bulbs artificially low for the last few years. At the same time, manufacturers are increasing wholesale prices to take advantage of the European ban on ‘energy guzzling’ old-style bulbs. Retailers also claim bulbs that currently cost only 33p are expected to sell for more than £1 within three months. Some will cost £3 or more. The move comes as Britain is gearing up to phase out the last incandescent light bulbs in an effort to meet climate change targets. The EU has already banned shops from buying stocks of 100watt bulbs and stopped them stocking up on any type of frosted incandescent bulbs.

The only silver lining to this dark cloud is that (at least I don’t think) CFLs are not subsidized in the United States. So while it is likely that prices will increase once there no longer is competition from incandescent bulbs, hopefully American consumers will not face the same big price hikes as their British cousins.

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The mid-term elections were a rejection of President Obama’s big-government agenda, but those results don’t necessarily mean better policy. We should not forget, after all, that Democrats rammed through Obamacare even after losing the special election to replace Ted Kennedy in Massachusetts (much to my dismay, my prediction from last January was correct).

Similarly, GOP control of the House of Representatives does not automatically mean less government and more freedom. Heck, it doesn’t even guarantee that things won’t continue to move in the wrong direction. Here are five possible bad policies for 2011, most of which the Obama White House can implement by using executive power.

1. A back-door bailout of the states from the Federal Reserve – The new GOP Congress presumably wouldn’t be foolish enough to bail out profligate states such as California and Illinois, but that does not mean the battle is won. Ben Bernanke already has demonstrated that he is willing to curry favor with the White House by debasing the value of the dollar, so what’s to stop him from engineering a back-door bailout by having the Federal Reserve buy state bonds? The European Central Bank already is using this tactic to bail out Europe’s welfare states, so a precedent already exists for this type of misguided policy. To make matters worse, there’s nothing Congress can do – barring legislation that Obama presumably would veto – to stop the Fed from this awful policy.

2. A front-door bailout of Europe by the United States – Welfare states in Europe are teetering on the edge of insolvency. Decades of big government have crippled economic growth and generated mountains of debt. Ireland and Greece already have been bailed out, and Portugal and Spain are probably next on the list, to be followed by countries such as Italy and Belgium. So why should American taxpayers worry about European bailouts? The unfortunate answer is that American taxpayers will pick up a big chunk of the tab if the International Monetary Fund is involved. Indeed, this horse already has escaped the barn. The United States provides the largest amount of  subsidies to the International Monetary Fund, and the IMF took part in the bailouts of Greece and Ireland. The Senate did vote against having American taxpayers take part in the bailout of Greece, but that turned out to be a symbolic exercise. Sadly, that’s probably what we can expect if and when there are bailouts of the bigger European welfare states.

3. Republicans getting duped by Obama and supporting a VAT – The Wall Street Journal is reporting that the Obama Administration is contemplating a reduction in the corporate income tax. This sounds like a great idea, particularly since America’s punitive corporate tax rate is undermining competitiveness and hindering job creation. But what happens if Obama demands that Congress approve a value-added tax to “pay for” the lower corporate tax rate? This would be a terrible deal, sort of like a football team trading a great young quarterback for a 35-year old lineman. The VAT would give statists a money machine that they need to turn the United States into a French-style welfare state. This type of national sales tax would only be acceptable if the personal and corporate income taxes were abolished – and the Constitution was amended to make sure the federal government never again could tax what we earn and produce. But that’s not the deal Obama would offer. My fingers are crossed that Obama doesn’t offer to swap a lower corporate income tax for a VAT, particularly since we already know that some Republicans are susceptible to the VAT.

4. Regulatory imposition of global warming policy – This actually is an issue we needed to start worrying about before this year. The Obama Administration already is in the process of trying to use regulatory edicts to impose Kyoto-style restrictions on energy use, and 2011 may be a pivotal year for this issue. This issue is troubling because of the potential impact on economic growth, but it also represents an assault on the rule of law since the White House and the Environmental Protection Agency are engaging in regulatory overreach because they did not have enough support to get so-called climate change legislation through Congress. The new GOP majority presumably will try to use the “power of the purse” to limit the EPA’s power grab, and the outcome of that fight could have dramatic implications for job creation and competitiveness.

5. U.N. control of the Internet – The Federal Communications Commission just engaged in an unprecedented power grab as part of its “Net Neutrality” initiative, so we already have bad news for both Internet consumers and America’s telecommunications industry. But it may get worse. The bureaucrats at the United Nations, conspiring with autocratic governments, have created an Internet Governance Forum in hopes of grabbing power over the online world. This has caused considerable angst, leading Vint Cerf, one of inventors of the Internet (sorry, Al Gore) to warn: “We don’t believe governments should be allowed to grant themselves a monopoly on Internet governance. The current bottoms-up, open approach works — protecting users from vested interests and enabling rapid innovation. Let’s fight to keep it that way.” International bureaucracies are very skilled at incrementally increasing their authority, so this won’t be a one-year fight. Stopping this power grab will require persistent oversight and a willingness to reject compromises that inevitably give bureaucracies more power and simply set the stage for further demands.

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Too bad the gift-giving season is already over. Thanks to this story about three men who were arrested by Japanese police for providing coffee enemas without regulatory approval, I now know that I could have purchased a “rectal infusion kit” for only $110. But since Senator Reid will still be around next Christmas, let’s focus on the public policy angle and ask ourselves why Japan’s government has licensing rules for coffee enemas?

In almost all cases, licensing rules are imposed by governments to protect politically powerful providers in a certain industry. The Institute for Justice has done heroic work on this issue, and they are always fighting to break up government-sanctioned cartels that limit competition, lead to higher prices, and make it hard for new providers to enter the market.

I’m sure these Japanese rules exist to unfairly enrich that nation’s medical profession. I can’t help but wonder, though, whether Japan’s bureaucrats have covered all the bases. Are tea enemas also covered by the regulations? What about if you use “fair trade certified” coffee from Starbucks? Are people allowed to buy toilets with built-in enemas? And what about bidets? Surely regular people can’t be trusted to operate such equipments without some sort of government involvement!

So many…um…fascinating questions to ponder. Anyhow, here’s a blurb from the story.

Police in Chiba Prefecture arrested three men this month on suspicion of violating Japan’s Medical Practitioners Law by providing coffee enemas without the proper medical qualifications, according to local media reports. Chikayoshi Hishiki (55) and two associates offered coffee-based enemas as a beauty treatment at their now-defunct alternative medicine clinics, according to leading daily Sankei Shimbun. The three suspects denied any wrongdoing, claiming they only provided the equipment and cleaned up afterwards, while the clients themselves administered the procedure, the report said. Some Japanese have become interested in filling their bums with java, believing they have discovered a secret dieting technique used by celebrities in the US and Europe.

CYA Disclaimer: Just because the Internet is a handy way of accessing information, that doesn’t mean that everything you read is true. So I make no claims that this story is 100 percent true, though governments are so stupid that I’m guessing it is accurate.

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Some ideas are so horrible that I’m almost at a loss for words. The United Nations is a grotesquely wasteful and corrupt international bureaucracy with a long track record of failure and incompetence.

Yet some people think this collection of looters, moochers, and kleptocrats should have authority over the Internet. I’m not kidding. Here are some of the details from an Australian newspaper.

The United Nations is considering whether to set up an inter-governmental working group to harmonise global efforts by policy makers to regulate the internet. Establishment of such a group has the backing of several countries, spearheaded by Brazil. At a meeting in New York on Wednesday, representatives from Brazil called for an international body made up of Government representatives that would to attempt to create global standards for policing the internet… India, South Africa, China and Saudi Arabia appeared to favour a new possible over-arching inter-government body. However, Australia, US, UK, Belgium and Canada and attending business and community representatives argued there were risks in forming yet another working group that might isolate itself from the industry, community users and the general public.

For what it’s worth, this proposal is so crazy that it appears that even the Obama Administration is opposed. I certainly hope so, because this proposal inevitably would lead to many bad results, including restrictions on freedom of speech.

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The South Los Angelos City Council is not satisfied with the culinary choices of the people of South Los Angelos. While consumers have been voting one way with their wallets, the City Council has voted to use government force to override their preferences.

How many fast food eateries does one area really need? The Los Angeles City Council thinks South Los Angeles and South East Los Angeles need new choices as these regions face an over-concentration of such restaurants.

“This is not an attempt to control people as to what they can put into their mouths. This is an attempt to diversify their food options,” said councilmember Jan Perry.

Perry’s new plan bans new so-called “stand alone” fast food restaurants opening within half a mile of existing restaurants.

This is an argument straight out of Orwell’s Ministry of Plenty. Government does not offer diversity; markets do. Compare the diversity you see in any private industry, such as automobiles or cell phones, with that in more heavily regulated sectors, such as education and mail delivery.

Are we really supposed to believe that, in exercising control over the availability of goods, they are not attempting to influence how those goods are consumed? Please, councilmember Perry, you’ll have to do better than that. Of course you are trying to control what people eat.

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Government bureaucrats think it is their business to prevent individuals from entering voluntary contracts with companies or organizations if the level of compensation does not meet some arbitrary threshold. Congress has used minimum wage laws to prevent certain arrangements, while the Department of Justice has a set of rules detailing when unpaid internships are considered legal.  Naturally, these rules do not apply to government.

At CEI’s Open Market, Brian McGraw points to these rules from the DoJ that won’t apply for the currently advertised unpaid internships at the White House:

  1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
  2. The internship experience is for the benefit of the intern;
  3. The intern does not displace regular employees, but works under close supervision of existing staff;
  4. The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
  5. The intern is not necessarily entitled to a job at the conclusion of the internship; and
  6. The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

Yes, number 4 really does say that it’s legal only for a corporation to use unpaid interns if they are counter-productive. No such restriction will apply for the White House, though, as “Unpaid internships in the public sector and for non-profit charitable organizations, where the intern volunteers without expectation of compensation, are generally permissible.”

It is obviously hypocritical for government to restrict the use of unpaid interns for others, while at the same time everyone knows that Washington thrives on the practice. But there is no good reason for these restrictions on anyone. Individuals that enter into unpaid internships do so because they will receive something in return, usually training and experience to add to their resumes, that they value more than their labor. They would not take the position if this were not true. Like most government actions designed to protect people from themselves, prohibiting individuals from entering into voluntary unpaid internships actually harms them by limiting their opportunities.

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A new study from the Small Business Administration’s Office of Advocacy concludes that annual regulatory costs jumped by nearly $600 billion between 2005 and 2008. Thanks to the Obama Administration’s big-government agenda, the burden of red tape today doubtlessly is much higher, but the 2008 estimate is enough to generate some very sobering numbers. A $1.75 trillion regulatory cost works out to be more than $15,500 for every household and more than $8,000 for every employee in the country. Red tape is especially challenging for smaller firms, as noted in these key findings from the summary:

The research finds that the total costs of federal regulations have further increased from the level established in the 2005 study, as have the costs per employee. More specifically, the total cost of federal regulations has increased to $1.75 trillion, while the updated cost per employee for firms with fewer than 20 employees is now $10,585 (a 36 percent difference between the costs incurred by small firms when compared with their larger counterparts).

To be sure, some forms of regulation, such as environmental protection, generate benefits. There generally are not good estimates needed to produce cost-benefit analyses, but it is quite likely that the costs are much higher than necessary – particularly for economic regulation, the burden of which is more than three times larger than the costs of environmental regulation.

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