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CEI Today: Farm Bill, Obamacare impact on jobs/state courts, and misuse of E-Verify

Nicole Ciandella — Wed, 19 Jun 2013 12:58:18 +0000

FARM BILL - FRAN SMITH

Farm Subsidy Programs in House Farm Bill

The House is expected to vote this week on the five-year farm bill. But representatives from a diverse coalition of groups - such as CEI, the Environmental Working Group, National Taxpayers Union, National Black Farmers Association, U.S. PIRG, and Defenders of Wildlife - have voiced serious concerns with massive farm subsidy programs contained in the bill.

OBAMACARE IMPACT - BILL FREZZA

Forbes: Coming Soon: A Dramatic Downshift In Company Size, Plus Hours Worked

The effect [of Obamacare] will be a dramatic shift in firm size, as many medium-sized companies restructure to avoid the law, spinning out functions to subsidiaries. Outsourcing, subcontracting, and shifting employees from full to part time will become the norm. Entirely new corporate forms are likely to emerge—for example restaurants with no wait staff will contract work to wait staff firms with no restaurants, allowing each to operate under the thresholds. Small businesses will put off growth plans to avoid tripping the limits, learning, like Italian firms, that when growth is punished, small is beautiful indeed.

E-VERIFY - DAVID BIER

Openmarket.org: E-Verify National ID System Threatens Americans’ Privacy

“I’m not a criminal, so there’s really no reason for me to be in a criminal database.” That was James Shepherd, a Kentucky native and a roofer, after he was stopped by police under “suspicion of trespassing” at a Florida hotel. The officer on the scene asked to take his picture and ran it through Florida’s facial recognition database. Finding no matches, he uploaded Shepherd’s photo with the label “suspicious person.”

This should make those who support, in order to stop illegal immigration, the E-Verify national ID system contained in the Senate immigration bill consider what other applications authorities could find for the System. >

CEI Staff

Wed, 2013-06-19

Sub Title:

Today in the News

Halbig v. Sebelius: Government motion to defer briefing on plaintiffs’ summary judgment motion

Sam Kazman — Fri, 14 Jun 2013 16:08:21 +0000

Halbig v. Sebelius: Government motion to defer briefing on plaintiffs’ summary judgment motion

Sam Kazman

Fri, 2013-06-14

Halbig v. Sebelius: Plaintiffs’ opposition to government motion to defer summary judgment briefing

Sam Kazman — Fri, 14 Jun 2013 18:19:49 +0000

Sam Kazman

Fri, 2013-06-14

America should learn from Europe on wind power

Iain Murray — Thu, 13 Jun 2013 17:53:39 +0000

As the Department of Energy considers a loan guarantee for the Cape Wind Project in Massachusetts, it should learn from Europe's failed wind energy experiments – and from its own troubled experiences with renewable energy projects.

Germany and Spain are waking up to the inevitable truth about renewable energy, especially offshore wind. They are now realizing the projects cannot survive without subsidies and that they make energy much more expensive to households and businesses. In an age of austerity, they are a luxury even Germany, Europe's economic powerhouse, cannot fully afford any more.

When Germany decided to close down its nuclear power stations after the Fukushima disaster in Japan, the original plan was to replace most of the lost generating capacity with wind power. However, wind power is expensive, and the growing size of the industry has meant that subsidies – and energy bills – have surged. The German subsidy is paid for by a surcharge on household electricity bills. The growth in wind power meant that in January the surcharge increased to over 5 cents (euro) per kilowatt hour, representing 14% of all electricity bills.

In Germany, Chancellor Angela Merkel, realizing that wind power is economically unsustainable, has proposed capping the subsidy until the end of 2014 and capping further rises to 2.5%, with the probability of further significant reform after the federal elections this year. It's a similar story in Spain, where subsidies have been cut so much that the chairman of the country´s Association of Renewable-Energy Producers said recently: "Spain's government is trying to smash the renewable-energy sector through legislative modifications."

President Obama has repeatedly said we should look to Spain and Germany for the lead on renewable energy policy. He is right, but not in the way he thinks.

Furthermore, he should look to the Cape Wind project in Nantucket Sound. The project will cost $2.6 billion, and it has secured funding for $2 billion of that from a Japanese bank. But this is believed to be subject to the project gaining a loan guarantee from the U.S. Department of Energy. And there is every reason to believe that this would be as bad a bet as its loan guarantee to Solyndra.

The contracted cost of the wind farm's energy will be 23 cents a kilowatt hour (excluding tax credits, which are unlikely to last the length of the project), which is more than 50% higher than current average electricity prices in Massachusetts. The Bay State is already the 4th most expensive state for electricity in the nation. Even if the tax credits are preserved, $940 million of the $1.6 billion contract represents costs above projections for the likely market price of conventional power. Moreover, these costs are just the initial costs, and like in Germany, they are scheduled to rise by 3.5 percent annually for 15 years.

This massive increase in energy costs is bad news for Bay State businesses and may well drive some of them out of the state entirely. That's a disaster for jobs and for tax revenue.

The likelihood that businesses will not be willing to pay the bill means that the burden will fall increasingly on households. Yet, in all probability, this will be politically unsustainable, and the cost will therefore fall back on taxpayers across the nation, via the loan guarantee.

That's just the economic argument. When you consider the environmental arguments, the case becomes a no-brainer. As the Alliance to Protect Nantucket sound points out, "Cape Wind threatens the marine environment and would harm the productive, traditional fisheries of Nantucket Sound."

The Alliance also notes that, "Cape Wind would not make a significant contribution to the effort to reduce pollution emissions, and, in fact, could aggravate the problem by causing dirty power plants to run more often in order to be ready to generate power instantly when the wind stops blowing."

For the Department of Energy to grant the loan guarantee to Cape Wind would be a triumph of blinkered ideology over real economic and environmental concerns. The president, true to his word, should learn from Germany and turn down the loan guarantee to Cape Wind.

Iain Murray

Thu, 2013-06-13

Citation Source:

USA Today

http://www.usatoday.com/story/opinion/2013/06/13/america-wind-power-column/2397447/

Border Security Amendments Won't Work Without Legal Immigration Fix

Nicole Ciandella — Thu, 13 Jun 2013 15:54:29 +0000

WASHINGTON, D.C., June 13, 2013 — Yesterday, Sen. John Cornyn proposed a major amendment to the Senate immigration bill (S. 744), which would completely replace the bill’s current border security provisions. The proposal—nicknamed the RESULTS amendment—increases security funding in the bill and strengthens the bill’s security “triggers” by delaying the pathway to citizenship for newly legalized immigrants until border patrol has surveillance of the entire border and apprehends at least 90 percent of all attempted illegal entries.

David Bier, Immigration Policy Analyst at the Competitive Enterprise Institute, congratulated the senator for his focus on security, but said the proposals would waste money without changing the legal immigration sections of the bill.

“The senator’s proposal would create a stronger political incentive to secure the border,” Bier said. “But the amendment fails to account for why so many people attempt to enter illegally. Without legal means to enter the United States, border patrol will continue to be overwhelmed by illegal crossings. The bill offers a yearly average of just 45,000 guest work visas over the next four years. In future years, the number could increase to 200,000 annually. But that is still hundreds of thousands fewer than what is needed to meet the border security targets.”

Bier said that the bill should connect border security to guest work visas. “The number of guest work visas should automatically rise in any year that border security fails to meet the 90 percent apprehension rate,” Bier said. “When people are willing to risk their lives and freedom to cross the border, it is a market signal that visa supply is nowhere near visa demand. It should always be less costly to enter this country legally than illegally. Sen. Cornyn’s efforts to drive up the costs of illegal immigration are a good start, but ultimately will only be successful in conjunction with reforms that cut red tape in the legal immigration process.”

CEI Staff

Thu, 2013-06-13

Sub Title:

Reforms Don't Address Why Workers Enter Illegally, Says CEI Analyst

CEI Today: Libertarian government, Julian L. Simon Award, and passenger rail problems

Nicole Ciandella — Thu, 13 Jun 2013 14:07:42 +0000

LIBERTARIAN GOVERNMENT

What Would Libertarian Government Look Like? CEI Offers Some Steps to Find Out

Washington Post columnist E.J. Dionne wrote in a recent column that if true small-government, libertarian policies are the best way to organize society, then why doesn’t a single country on Earth embrace this framework.

At the Competitive Enterprise Institute, we say, “Let’s give it a try.” How about, as we survey a country in which the IRS is targeting right-of-center groups, the National Security Agency is monitoring our phone calls and the government is tapping phone lines of reporters, we stop and consider a few steps to reduce the size, cost and scope of government?

CEI lays out a few such steps in Avoiding the Regulatory Cliff: A Bipartisan Agenda to Restore Limited Government and Revive America’s Economy.

JULIAN L. SIMON MEMORIAL AWARD

Scholar Awarded Julian L. Simon Memorial Award for Moral, Historical Defense of Freedom

CEI is pleased to announce that Deidre McCloskey, Distinguished Professor of Economics, History, English, and Communication, at the University of Illinois at Chicago, is the recipient of CEI’s prestigious Julian L. Simon Memorial Award. McCloskey’s groundbreaking scholarly work has focused on historical analysis of the factors that led to advancement in human achievement and prosperity.

The award will be presented at CEI's annual gala dinner, June 20, 2013, in Washington, D.C. Previous award recipients include Stephen Moore of the Wall Street Journal, President Václav Klaus of the Czech Republic and "Skeptical Environmentalist" Bjørn Lomborg.

OVER-REGULATED RAIL - MARC SCRIBNER

WRVA: How to Boost Rail in the US

If passenger trains are ever to attract ridership and become a viable part of the country’s transportation mix again, it is vital that operators have access to the best practices and the best, most cost effective trains available. Yet presently, American passenger railways are forbidden from purchasing trains in the most cost-effective manner possible. The Federal Railroad Administration (FRA) has strict crash safety regulations for passenger railcars which trains in Europe—where passenger rail is well established and remarkably safe—do not have to meet.

Thu, 2013-06-13

Sub Title:

Today in the News

Climate Models Predict Heat That Hasn't Occurred

Marlo Lewis, Jr. — Thu, 13 Jun 2013 17:49:47 +0000

Making the case against the models even stronger is the fact that the observed temperatures were taken from the tropical troposphere where, according to Marlo Lewis of the Competitive Enterprise Institute, "the models project the strongest, least ambiguous, greenhouse warming signal."

Marlo Lewis, Jr.

Thu, 2013-06-13

Citation Source:

Investor's Business Daily

http://news.investors.com/ibd-editorials/061113-659660-observed-temperatures-cooler-than-scientists-projections.htm

Scholar Awarded Julian L. Simon Memorial Award for Moral, Historical Defense of Freedom

Christine Hall — Thu, 13 Jun 2013 09:31:56 +0000

WASHINGTON, D.C., June 13, 2013 - CEI is pleased to announce that Deirdre McCloskey, Distinguished Professor of Economics, History, English, and Communication, at the University of Illinois at Chicago, is the recipient of CEI’s prestigious Julian L. Simon Memorial Award. McCloskey’s groundbreaking scholarly work has focused on historical analysis of the factors that led to advancement in human achievement and prosperity.

“Deirdre McCloskey is a great intellectual and one of the most prominent economic historians alive today,” said CEI Founder and Chairman Fred L. Smith, Jr. “McCloskey offers a moral defense of freedom: She understands that for society to really thrive, society can’t just accept or tolerate economic freedom – society must embrace it. When societies value freedom and capitalism, they prosper.

“McCloskey's impeccable research has documented the cultural transformation in 17th and 18th Century Europe that changed the way society thinks about trade and commerce, which in turn resulted in lifting people out of squalor. Before then, only aristocrats had wealth. That new way of thinking freed people from thousands of years of grinding poverty.”

The Simon Award was established in 2001 in honor of the late free market economist, Julian L. Simon, whose classic 1981 work, The Ultimate Resource, debunked alarmist predictions of eco-doomsayers such as Paul Ehrlich. The award will be presented at CEI's annual gala dinner, June 20, 2013, in Washington, D.C. Previous award recipients include Stephen Moore of the Wall Street Journal, President Václav Klaus of the Czech Republic and "Skeptical Environmentalist" Bjørn Lomborg.

“Professor McCloskey perfectly embodies the spirit in which CEI’s Julian Simon Award was created,” said CEI President Lawson R. Bader. “Her work contributes tremendously to our understanding of the value of free markets, vigorously defends capitalism and entrepreneurialism and makes the case for freedom with a rare eloquence. It is our pleasure to honor her work.”

Quotes & wisdom from Deirdre McCloskey, in The Bourgeois Virtues: Ethics for an Age of Commerce:

One can think of the calamities of the 20th century as caused by the sins of capitalism. The left does. Capital was born, wrote Marx, “dripping from head to foot, from every pore, with blood and dirt.” I think on the contrary that most of the calamities were a consequence of the attacks on capitalism.
Viewed over a longer period, however, the most amazing political fact since, say, 1800, as Tocqueville noted as early as 1835, is the spreading idea of equality in freedom, that theory of the ascendant bourgeoisie. Cynics and Jeremiahs to the contrary, it spreads yet. According to Freedom House, the percentage of “free” countries rose from 29 percent in 1973 to 46 percent in 2003, containing 44 percent of the world’s population. Think of Ukraine and South Korea. The world continues to draw on a lost, failed, used-up liberalism. Liberal democracy keeps on explaining events.
Possibly modern economic growth is as large and important an event in human history as the sudden perfection of language, in Africa around 50,000 BC. In a scarce 200 years our bourgeois capitalism has domesticated the world and made it, Chicago to Shanghai, into a single, throbbing city.
The triple revolutions of the past two centuries in politics, population, and prosperity are connected. They have had a cause and a consequence, I claim, in ethically better people. I said “better.” Capitalism has not corrupted our souls. It has improved them.
On the political left it has been commonplace for the past century and a half to charge that modern, industrial people, whether fat or lean, are alienated, rootless, angst-ridden, superﬁcial, materialistic; and that it is precisely participation in markets which has made them so. Gradually, I have noted, the right and the middle have come to accept the charge. I claim that actually existing capitalism, not the collectivisms of the left or of the right, has reached beyond mere consumption, producing the best art and the best people. People have purposes. A capitalist economy gives them scope to try them out. Go to an American Kennel Club show, or an antique show, or a square-dancing convention, or to a gathering of the many millions of American birdwatchers, and you’ll ﬁnd people of no social pretensions passionately engaged. Yes, some people watch more than four hours of TV a day. Yes, some people engage in corrupting purchases. But they are no worse than their ancestors, and on average better.

Christine Hall

Thu, 2013-06-13

Avoiding the Regulatory Cliff

Nicole Ciandella — Wed, 12 Jun 2013 15:54:24 +0000

Full Document Available in PDF

Whether you are new to Congress or have weathered many a political campaign welcome (back) to Washington. I too have recently taken on a new role as the president of the Competitive Enterprise Institute. I trust we are wise to remember, however, that our respective new (or renewed) roles are nothing more than a transfer of a precious intellectual inheritance. We all should be focused on implementing the legacy of centuries of ideas about how individual and economic liberty combined with limited public institutions improve human dignity, from Adam Smith to the U.S. Founders to Lord Acton to F. A. Hayek and many others.

To put ideas into action, CEI has always been more than “just a think tank.” Instead, we take a full-service approach to public policy— combining rigorous policy work with an activist’s ability to market, educate, and propagate our research findings and principles. We at CEI are always willing to explain, to anyone who will listen why economic liberty make us all better off, but we do not stop there. We are committed to being honest idea brokers. We are eager to engage, build coalitions, file Freedom of Information Act requests, broadcast our message near and far, and, when necessary, sue to ensure our economic future remains grounded in these timeless principles.

Many agree on the importance of free enterprise, but perceptions vary on what exactly it is. Some think it is a system about money and how to make it—a method for how to foresee the ups and downs of Wall Street, the movement of interest rates, or the right time to buy a house. These are woefully inadequate and shallow understandings of the idea, but unfortunately they are widespread. Thus, it is no surprise that many think “market perspectives” are of little help to policy makers as they wrestle with real and challenging problems.

CEI views markets not as an ideology or a set of specific policy prescriptions, but as a tool for understanding the world. Money does not need be involved to make a decision be “economic.” The free enterprise way of thinking helps us to understand what happens whenever people make choices in pursuit of goals. When we apply it this way, it becomes very effective in exploring how the world works. A central insight we gain from free enterprise is that the world is enormously complex and interconnected. We believe that markets are a key form of this interconnectedness that is not only crucial to the functioning of a modern economy, but that enables us to understand what is not always obvious.

We are not naïve, however. We also understand that political discourse often focuses on what is visible and immediate. This can create conflicts between the economically sensible and the politically fashionable. Consequently, I am pleased to present Avoiding the Regulatory Cliff: A Bipartisan Agenda to Restore Limited Government and Revive America’s Economy. In this document, CEI policy experts have created concrete, achievable proposals to liberate the creative energies of American entrepreneurs, companies, and workers.

Our compendium highlights four important lessons.

The first is that markets are dynamic. Contrary to textbook models, real-world markets are not static, predictable, or perfectly efficient—like machines. Rather, they are dynamic, unpredictable, and self-organizing—like organisms.

The second lesson is that markets encourage experimentation, and through trial-and-error, innovations produce progress. Markets lead to economic progress because they encourage and test on-the-spot experimentation among millions of individuals. From this decentralized trial-and-error process come innovations and coordination that no single mind could have planned.

The third lesson is when altering rules of the game, be aware of “unseen” consequences. The institutions governing markets are crucial. Given that markets are so complex and ever changing, and given that people respond to incentives created by institutions, minor changes in market institutions can have far-reaching effects— both positive and negative—that are difficult to see and even harder to predict.

The fourth lesson is act like market-growing gardeners, not blueprint-writing engineers. Public policies that pick winners or prescribe one-best-way solutions will tend to freeze markets and reduce innovation. The better role for public policy is to ensure underlying rules of the game that (a) maintain the openness and dynamism of already-established markets; and (b) encourage the evolution of decentralized, self-organizing markets where they do not yet exist.

On a personal level, “Free enterprise” is just another phrase for what I call the “freedom to prosper.” And, as Adam Smith knew well, material prosperity is only a means to an end. The question is: To what end? Some pursue wealth to stockpile villas and private planes. Some start charities to fight sex trafficking and cure AIDS. Along the way one creates new jobs for thousands, another soothes shattered souls. We who advocate economic liberty recognize these endeavors as the choices that free individuals make to realize their dreams and all are necessary to improving the human condition. And by doing so, we contribute to a more dynamic and innovated American economy.

Promoting this freedom to prosper should be Congress’s top priority for the next four years—and beyond. CEI stands ready to be a resource to you to help make this a reality.

CEI Staff

Wed, 2013-06-12

Sub Title:

A Bipartisan Agenda to Restore Limited Government and Revive America's Economy

What Would Libertarian Government Look Like? CEI Offers Some Steps to Find Out

Nicole Ciandella — Wed, 12 Jun 2013 16:30:23 +0000

WASHINGTON, D.C., June 12, 2013 – Washington Post columnist E.J. Dionne wrote in a recent column that if true small-government, libertarian policies are the best way to organize society, then why doesn’t a single country on Earth embrace this framework.

CEI lays out a few such steps in Avoiding the Regulatory Cliff: A Bipartisan Agenda to Restore Limited Government and Revive America’s Economy. The publication, produced every two years, lays out practical steps Congress can take to reduce the burden of government, curb costly regulations and increase liberty, prosperity and economic vitality.

Some items within the publication, such as an essay that calls for rejecting the precautionary principle as a threat to technological progress, require a change of thought. Others, such as a piece that calls for improving food safety by promoting consumer awareness and choice, require a change in how government informs us about research, risk and other matters. Others, such as a piece on ending bailouts and government ownership in Fannie Mae, Freddie Mac, General Motors, AIG and other entities, require a change in approach.

But many amount to reforming regulations and how they are developed and keeping citizens in mind when promulgating the rules and laws we all must live by.

For instance, Wayne Crews, CEI’s Vice President for Policy and Director of Technology Studies, lays out six achievable steps to slow the regulatory juggernaut:

• Establish a bipartisan Regulatory Reduction Commission to survey and purge outdated or poorly functioning rules.

• Develop a sunsetting schedule for new regulations and agencies.

• Approve major regulations with an up-or-down vote.

• Publish a regulatory report card alongside the federal budget.

• Require agencies to report costs so Congress can measure effectiveness.

• Have agencies and the Office of Management and Budget rank rules’ effectiveness and recommend the least-effective for elimination.

Other suggestions would guide legislative initiatives, such as:

• Curb crop subsidies, separate nutrition and energy from the farm bill and end the sugar program.

• Streamline testing of new medicines and medical devices, so new treatments can reach patients quicker, and protect intellectual property to encourage pharmaceutical innovation.

• End corporate welfare in all forms – subsidies, tariffs, regulations that favor the powerful, the Export-Import Bank, the Economic Development Administration and others.

• Roll back Sarbanes-Oxley to make it easier for startups to go public.

• Rethink anti-consumer antitrust legislation.

• Reject content regulation on TV and other media outlets.

• Privatize passenger rail, encourage private investment in freight rail and liberalize air travel.

• Spend money collected for highways on highways, not mass transit; and embrace tolling so highway users pay their fair share.

• Bring back private contractors for airport security. They did not fail on 9/11, and the Transportation Security Administration has been a disaster from the start.

The publication includes nearly 70 pages of productive solutions to roll back the overgrown regulatory state, and thus provide certainty and the proper incentives to American businesses and entrepreneurs, who are the true engines of our nation’s prosperity.

“Our task is to get Congress to act like market-growing gardeners rather than blueprint-writing engineers,” said Lawson Bader, president of CEI. “The better role for public policy is to ensure underlying rules of the game that maintain the openness and dynamism of established markets and encourage the evolution of decentralized, self-organizing markets where they do not yet exist.”

>> Read Avoiding the Regulatory Cliff: A Bipartisan Agenda to Restore Limited Government and Revive America's Economy here.

CEI Staff

Wed, 2013-06-12

Sub Title:

Agenda for Congress Lists Ways to Streamline Government, Aid Economy, Promote Innovation

Senate Immigration Bill Needs Rewrite on Guest Workers, Visa Regs, E-Verify, CEI Analyst Says

Nicole Ciandella — Tue, 11 Jun 2013 20:40:49 +0000

WASHINGTON, D.C., June 11, 2013 — Today, the Senate voted to proceed with debate on the Border Security, Economic Opportunity, and Immigration Modernization Act (S. 744). David Bier, Immigration Policy Analyst at the Competitive Enterprise Institute, applauded the vote but urged senators to address several problems with the bill before voting for final passage.

“This vote demonstrates that the Senate is truly committed to fixing America’s immigration system,” Bier said. “But major changes to the bill are still required if Congress hopes to keep America competitive and prevent future waves of illegal immigration.”

Most importantly, Bier said, the bill’s severe restrictions on guest workers need to be relaxed. “Without an expansion of the guest worker program, the bill will fall far short of the number of visas needed to prevent future waves of illegal immigration,” he said. “Moreover, Congress should not grant bureaucrats the authority to limit the flow of these workers. It should set visa limits that automatically increase if illegal entries continue – an indication demand is dramatically outstripping supply.”

Bier also pointed out that the current bill places unfair regulatory burdens on employers who hire highly skilled workers, such as longer wait times, more fees, and minimum wage and job advertisement requirements. “No one disputes that highly-skilled workers are great for America’s economy, so why would Congress add new burdens to the already-expensive visa process?” Bier asked. “America should roll out the red carpet for these workers rather than continue to push them to other countries.”

Another point of concern, Bier said, is E-Verify, the employment verification system in the Senate bill. “This system will impose major costs on American businesses,” Bier said. “The bill should eliminate penalties for employers if system errors deny hundreds of thousands of legal employees. As written, this system intends to create an electronic national ID system, complete with biometric profiles on every U.S. citizen. The bill needs strict limits on how this system can be used and what information it can contain.”

CEI Staff

Tue, 2013-06-11

Sub Title:

Reform Effort "Will Fall Short" If Guest Worker Program Is Not Expanded

CEI Today: Obamacare lawsuit, Barone on passenger rail regs, and nanny state attack on donuts

Nicole Ciandella — Mon, 10 Jun 2013 20:22:35 +0000

OBAMACARE LAWSUIT - SAM KAZMAN

Plaintiffs in Obamacare Suit File Motion for Summary Judgment

The individuals and small business owners who are suing the federal government over a major IRS regulation imposed under the Affordable Care Act filed a motion for summary judgment in the case.

The regulation extends Obamacare’s employer mandate to the “refusenik” states that have decided against setting up their own insurance exchanges. The Competitive Enterprise Institute is assisting in the coordination and funding of the lawsuit. Sam Kazman, general counsel at CEI, explained, "As the summary judgment motion makes clear, the IRS rule is illegal, period. It is an unauthorized attempt by the agency to override the decisions of 34 states to stay out of the Obamacare insurance exchange program and to avoid the huge burdens of the employer mandate.

GOV'T REGS vs PASSENGER RAIL

Michael Barone: Government regs hurt passenger rail

That’s the message of this paper from the Competitive Enterprise Institute. The writers point out the American safety regulators require passenger rail cars to be much heavier than European regulators do. But over the years, they say, the European cars have proved just as safe, and perhaps more so. >

DONUTS + LIBERTY - SAM KAZMAN

Fox News: On National Donut Day, eat a donut and strike a blow for liberty

What do donuts have to do with liberty, you might ask? Plenty.

Government today has crept into most areas of our lives and is rampaging into the rest. It’s no longer just the Nanny State; it’s Niagara, overwhelming and seemingly unstoppable. We have the White House nagging us to eat this and not eat that; FDA slapping warning labels on everything in sight; EPA declaring that every breath we take poisons the climate; and the Department of Energy pushing incandescent lights bulbs into contraband status.

CEI Staff

Mon, 2013-06-10

Sub Title:

Today in the News

Now the Environmental Protection Agency

Nicole Ciandella — Mon, 10 Jun 2013 20:13:01 +0000

The allegations were first made by the Competitive Enterprise Institute, a conservative Washington, D.C., think tank. It claimed the EPA was not being fair as it weighed whether to charge fees to groups seeking information via Freedom of Information Act requests.

Now the Environmental Protection Agency

CEI Staff

Mon, 2013-06-10

Citation Source:

Commentary

http://www.commentarymagazine.com/2013/06/10/now-the-environmental-protection-agency/

Government regs hurt passenger rail

Nicole Ciandella — Mon, 10 Jun 2013 20:09:44 +0000

The problem is that Amtrak and other passenger rail authorities set out to provide higher speed service, they can’t buy rail cars commonly used in Europe. Cars must be custom designed–which has produced real problems, as those Amtrak encountered with the Acela. It also means that American rail cars can’t go as fast as European cars can. European models, they say, could get from Washington to New York in two hours and 15 minutes. The Acela takes half an hour longer.

CEI Staff

Sun, 2013-06-09

Citation Source:

The Washington Examiner

http://washingtonexaminer.com/government-regs-hurt-passenger-rail/article/2531489

Plaintiffs press health act fight

Nicole Ciandella — Mon, 10 Jun 2013 20:14:23 +0000

The Competitive Enterprise Institute (CEI), which is coordinating the lawsuit, is following the lead of Oklahoma, which sued last year after the Internal Revenue Service issued a rule in May 2012 that would make federally run exchanges eligible for the subsidies.

The Obama administration, through the Treasury Department, says it is implementing the law appropriately while states work to reach benchmarks. In the Oklahoma case, it has argued the state does not have standing or jurisdiction to bring its lawsuit.

Plaintiffs in the CEI complaint are individuals and small businesses in states that have opted not to set up exchanges on their own.

CEI Staff

Sun, 2013-06-09

Citation Source:

The Washington Times

http://www.washingtontimes.com/news/2013/jun/9/plaintiffs-press-health-act-fight/

White House knew about Lisa Jackson’s secret email account

Christopher C. Horner — Mon, 10 Jun 2013 20:16:26 +0000

“I’m unclear how grown men and women could think that it’s acceptable to have a nonexistent employee sign in as the test-taker [or to have an] administrator take required certification training in the name of a false identity,” said Chris Horner, senior fellow at the Competitive Enterprise Institute, who was behind the lawsuit that forced the EPA to release the Richard Windsor emails.

Christopher C. Horner

Sun, 2013-06-09

Citation Source:

The Daily Caller

http://dailycaller.com/2013/06/09/white-house-knew-about-lisa-jacksons-secret-email-account/

‘Transparency’ through obstruction

Christopher C. Horner — Mon, 10 Jun 2013 20:17:56 +0000

But it wasn't the AP that originally uncovered Team Obama's penchant for email sock-puppetry. Chris Horner, Competitive Enterprise Institute fellow and author of “The Liberal War on Transparency,” first exposed former EPA Chief Lisa Jackson's Internet alter ego, “Richard Windsor,” last year. The free-market environmental think tank filed suit against the government last fall, seeking records on the secret, illegal “secondary” email accounts of high-level EPA officials after the agency ignored multiple FOIA filings.

Christopher C. Horner

Sun, 2013-06-09

Citation Source:

The Pittsburgh Tribune-Review

http://triblive.com/opinion/editorials/4143508-74/obama-transparency-email#axzz2VqWILrt4

Dodd-Frank’s Early Returns

John Berlau — Wed, 12 Jun 2013 19:22:26 +0000

‘Admit it . . . you haven’t read it all either.”

Thus said a New York Times op-ed (by Bono, of all people) about the Dodd-Frank Wall Street Reform and Consumer Protection Act, just a couple of months after that law’s passage in 2010. The line reflected a common sentiment toward the 2,600-page law, and things haven’t improved since. Both supporters and opponents of Dodd-Frank will concede that, as with Obamacare, members of Congress passed the law before they — or the public — knew or understood what was in it.

But give Obamacare this much: So far, in digging through its thousands of pages, no one has found any hidden provisions that significantly affect foreign policy, international trade, or energy policy. The same can’t be said for the so-called financial-reform bill.

“Hidden somewhere in the Dodd-Frank financial reform bill,” noted the op-ed, “there is a hugely significant ‘transparency’ amendment. . . . Now energy companies traded on American exchanges will have to reveal every payment they make to government officials.”

Hold on. A provision targeting energy companies — in a banking bill?

In the almost three years since Dodd-Frank was rammed through Congress, Fannie Mae and Freddie Mac — significant players if not the largest culprits in the mortgage crisis — are bigger than ever. The law did not lay a hand on them.

And many on both left and right say Dodd-Frank didn’t make a start on curbing the power of too-big-to-fail banks. In fact, the law’s designation of “systemically important financial institutions” through its Financial Stability Oversight Council enshrines too-big-to-fail by telling creditors which financial firms the government will spare from a normal bankruptcy.

But rest assured that Dodd-Frank is working — at great cost — to force energy companies to tell shareholders each and every payment they make to foreign governments, and all public companies to say whether they have ever used tin or tungsten from the Democratic Republic of the Congo. As explained by Mercatus Center scholars Hester Peirce and James Broughel in their book Dodd-Frank: What It Does and Why It’s Flawed, the law’s “miscellaneous provisions” in Title XV offer “a clear example of how a statute invoked as the answer to the financial crisis is, in reality, an odd conglomeration of responses to issues, many of which had nothing to do with the financial crisis.”

The specific provision championed by Bono ended up as Dodd-Frank’s Section 1504. With the stated aim of combating the use of “dirty money” by U.S. energy companies, it requires firms developing oil, gas, or minerals to disclose payments they make to foreign governments to further their development activities. Section 1502, championed by some of Bono’s fellow celebrities, including Ashley Judd and Ben Affleck, requires all types of firms to disclose their products’ use of five “conflict minerals” — including gold, tin, and tungsten — that can be sourced to war-torn regions of the Congo.

Fighting corruption and violence in the Congo is a laudable goal, but it is a bad idea to pursue foreign-policy objectives through a financial bill. There are a number of reasons for this, the most important being that the government entity charged with enforcing these provisions is neither the State Department nor the Defense Department, but rather the Securities and Exchange Commission — which no one would call an agency well-schooled in the nuances of foreign policy.

Under Dodd-Frank’s Title XV provisions, the SEC requires companies listed on U.S. stock exchanges to disclose these things in the same annual reports in which they disclose financial information to investors. This new mission creep imposed on the SEC could impair its efforts to protect U.S. investors from financial fraud, as Peirce and Broughel warn: “Title XV not only fails to address any issues that arose during the crisis, but it also distracts the SEC from undertaking reforms designed to prevent future crises.”

For Bono and other activists, it’s all worth it to be making a stand against — in the immortal words of musical satirist Tom Lehrer — “poverty, war, and injustice, unlike the rest of you squares.” Bono, who has in the past made thoughtful arguments on the role of trade and development in combating poverty, becomes almost a caricature of the rock-star crusader when he talks about this Dodd-Frank provision, spouting the tired and untrue platitude that “corruption [is] more deadly than the deadliest of diseases.” He concludes that this kind of forced disclosure “is the kind of daylight that makes the cockroaches scurry. . . . And the cost to us is zero, nada.”

In fact, even under the SEC’s constrained cost-benefit analyses, the costs of these rules are far from nada. The SEC has estimated that each provision would costs companies more than $1 billion in initial costs, with annual costs after that in the hundreds of millions. Moreover, U.S. energy companies exploring for resources abroad are now required to disclose to the general public information that fits into the category of trade secrets, by revealing how much they paid for each individual project. This means that the state-owned oil companies in some of the most corrupt regimes — which aren’t subject to Dodd-Frank because they don’t list on U.S. exchanges — now have access to this valuable info, giving them a competitive edge over their U.S. private-sector rivals. As American Petroleum Institute president Jack Gerard points out in a Wall Street Journal op-ed, “the 16 biggest oil companies in the world do not fall under SEC jurisdiction.”

And if the costs of these provisions force U.S. companies to pull out of developing countries, the results will not be pretty for the ordinary citizens of those countries — as has already been shown to a large extent with the “conflict minerals” provision.

Because it is nearly impossible to source many minerals used in manufacturing to their countries of origin — gold has been called “the world’s most recycled material” — many manufacturers have told their suppliers to avoid all regions of the Congo and all nearby nations. Bono and his fellow celebrity activists would do well to read another Times op-ed, in which freelance journalist David Aronson describes how Dodd-Frank’s backdoor tariffs are re-impoverishing Africa. Among the effects Aronson describes: “Mining towns are virtually cut off from the outside world because the planes that once provisioned them no longer land. . . . Villagers who relied on their mining income to buy food when harvests failed are beginning to go hungry.”

Dodd-Frank has already entrenched too-big-to-fail and worsened Third World poverty. That’s some achievement for a law that’s not yet three years old.

John Berlau

Fri, 2013-06-07

Citation Source:

National Review

http://www.nationalreview.com/article/350420/dodd-franks-early-returns-john-berlau

Plaintiffs in Obamacare Suit File Motion for Summary Judgment

Nicole Ciandella — Fri, 07 Jun 2013 16:01:05 +0000

WASHINGTON, D.C., June 7, 2013 — Yesterday, the individuals and small business owners who are suing the federal government over a major IRS regulation imposed under the Affordable Care Act filed a motion for summary judgment in the case. The regulation extends Obamacare’s employer mandate to the “refusenik” states that have decided against setting up their own insurance exchanges. The Competitive Enterprise Institute is assisting in the coordination and funding of the lawsuit.

Sam Kazman, general counsel at CEI, explained, "As the summary judgment motion makes clear, the IRS rule is illegal, period. It is an unauthorized attempt by the agency to override the decisions of 34 states to stay out of the Obamacare insurance exchange program and to avoid the huge burdens of the employer mandate. But those state decisions are based on a congressionally enacted statute, not a bureaucratically contrived rule. That may be unfortunate for the IRS, but it’s very fortunate for the rest of us.”

>> Read the motion here.

CEI Staff

Fri, 2013-06-07

Online 'Fairness' Tax Could Hit Your 401(k)

John Berlau — Wed, 12 Jun 2013 19:25:50 +0000

Financial transaction tax proposals have prompted much debate over the past year, both in the U.S. and internationally.

In February, the European Union proposed allowing its member countries to levy taxes on the trading of stock, bonds and derivatives.

Supporters argue that in addition to raising revenue, the tax would act as a "speed limit" that reduces volatility in the markets. Opponents counter with studies showing that the revenue estimates are overstated, and that the tax could actually increase volatility.

Additional concerns include the indirect impact on middle-class investors — the tax would hit trades done by mutual funds and retirement plans such as 401(k) accounts — and the competitive effects on particular jurisdictions, as the tax creates incentives for such transactions to move across borders.

Given these concerns, one would think that the U.S. Congress would carefully debate the merits of a financial transaction tax, not rush to approve it. Yet the U.S. Senate just passed a bill that may enable states to impose their own financial transaction taxes — a recipe for increasing economic uncertainty.

Supporters of the Marketplace Fairness Act (MFA), which the U.S. Senate passed on May 6 on a 69-27 vote, claim that online retailers enjoy an unfair advantage over their brick-and-mortar competitors. The bill, they maintain, addresses this imbalance by allowing states and localities to require "remote sellers" to collect taxes for "sales" to their residents.

However, the bill is silent on the particular products and services of "sellers" and "sales" it covers. Thus, it could open the door for state and local governments to tax financial transactions they deem as "sales" on businesses throughout the country.

Financial industry trade groups, including the Financial Services Roundtable and the Securities Industry and Financial Markets Association (SIFMA), have expressed concern. "The bill could lead to unexpected costs being passed on to consumers of financial services, including sales taxes on services or state-level stock transaction taxes," SIFMA says in a statement.

Similarly, Brian Graff, executive director of the American Society of Pension Professionals and Actuaries, notes, "The legislation would allow states to impose a financial transaction tax that would apply to American workers' 401(k) contributions and other transactions within workers' accounts."

Marketplace Fairness Act proponents have failed to counter these fears. In response to a questionnaire by Americans for Tax Reform, MFA co-sponsor Sen. Mike Enzi, R-Wyo., says there's nothing to fear, because now, "no state imposes a sales tax on financial transactions."

But states have done so in the past, and the legislation would give them incentive to do so again, because it would stifle tax competition.

For an idea of what a state-level financial transaction tax would look like, the history of a 20th century tax in New York state is instructive. From 1905 to 1981, the state imposed a transfer tax on securities transactions. After a 50% increase was proposed in the 1960s, the president of the New York Stock Exchange threatened to build a second trading floor in Trenton, N.J., to bypass the New York tax.

New York settled on a 25% increase instead, but even that caused many investors and financial firms to flee. A NYSE analysis from the late 1960s noted that, "New York securities markets have experienced increasing competitive problems in recent years from regional stock exchanges located in San Francisco, Los Angeles, Chicago, Detroit, Philadelphia and Boston. . . . From 1965 through 1967, the volume of trading on the regional exchanges increased by 73.2%."

This competition prompted New York to phase out the tax starting in the 1970s. The state still collects a nominal tax, but since 1981, the proceeds have simply been returned to traders.

If the Senate version of the Marketplace Fairness Act were to sail through the House unchanged, states would have little reason to worry about financial firms fleeing. If New York were to re-impose a stock transfer tax, as some progressives propose, the state could blunt the impact of the NYSE leaving by simply classifying it as a "remote seller" and requiring it to remit taxes to state coffers for any sale that might involve a New York business or resident.

For that matter, New York and other states could also tax "remote sales" made from the BATS Exchanges in Lenexa, Kansas (a suburb of Kansas City), which now make up more than 10% of equity trading in the U.S. The possibilities are seemingly endless for states hungry for revenue or seeking to wage populist crusades against the financial industry.

Middle-class savers would lose out as hidden taxes chip away at their 401(k)s, mutual funds, and brokerage accounts.

So would U.S. competitiveness. A uniform tax from EU countries would look mild to international investors in comparison to an unpredictable tax regime of varying tax rates on financial transactions from several different states.

Despite warnings, the Senate brushed aside these dangers to the U.S. financial system as it rushed through the Marketplace Fairness Act.

To borrow a phrase from investing, the House needs to undertake some much-needed due diligence on the bill before it completes the transaction of passage.

John Berlau

Thu, 2013-06-06

Citation Source:

Investor's Business Daily

http://news.investors.com/ibd-editorials-viewpoint/060613-659071-marketplace-fairness-act-could-hamper-financial-competitiveness.htm?p=full