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OpenMarket: May 2013

  • CEI Joins Push for Corporate Tax Reform

    May 31, 2013 3:25 PM

    Today, the Competitive Enterprise Institute signed on to a letter with taxpayer groups and other public policy organizations that urges Congress to act on corporate tax reform. “High taxes on businesses hinder job creation, drive up costs and make America less competitive,” said Iain Murray, vice president of strategy at CEI. “Today, the United States has the highest corporate tax rate in the developed world. This seems incongruous with rebuilding our economy.”

    The letter can be viewed here.

  • Senate Bill Won't Stop Illegal Immigration Without More Work Visas

    May 31, 2013 5:00 AM

    When the Senate “Gang of 8” released their immigration reform principles earlier this year, they made an important admission: that drastic restrictions on low-skilled work visas incentivizes illegal immigration. The principles called for “a humane and effective system” for the “overwhelming majority of the 327,000 illegal entrants” apprehended in 2011 “to prevent future waves of illegal immigration.” Unfortunately, although the Gang’s bill improves legal immigration options, it clearly doesn’t live up to this principle.

    The Senate legislation deletes one option while creating two new ones—one for agricultural work and another for non-agricultural work. It allocates 112,333 ag visas (W-2/W-3 visas) per year for the first five years. But it replaces the H-2A farm visa program that already brought in around 80,000/year. This means the new ag visa program initially adds at most  just 32,333 net visas each year. For other employment (W-1 visas), the bill grants just 46,250/year over the first four years—meaning, the government would issue up to (no guarantees!) 78,583 new visas per year for the next four years.

    In other words, the bill’s quotas are 250,000 below what the Gang claimed was necessary just a few months ago. Worse still, the actual shortfall is much greater than this because the Gang’s estimate of visa demand 1) excluded demand from would-be legal immigrants and 2) only included “apprehended” entrants 3) from a single year and 4) from a single border region.

    1) Many more would-be legal immigrants would want to come if legal options open up; 2) the apprehension figure ignores all those avoided detection (about 350,000/year during the 2000s); 3) FY2011 had extraordinary few apprehensions—even in 2008 the number was twice as high (475,000/year over last five years); 4) these visas might primarily go to immigrants from Mexico and central America, the primary sending nations for border crossers, but other nations would also compete for the limited supply; 5) finally, the calculation ignores how increasing the availability of work visas to new sectors (dairy, meatpacking, etc.) and new job categories (employment longer than a year) might affect U.S. employer demand.

  • CEI Podcast for May 30, 2013: The Politics of Caffeine

    May 30, 2013 5:16 PM

    The Food and Drug Administration recently announced plans to investigate, and possibly regulate, caffeine consumption. Fellow in Consumer Policy Studies Michelle Minton prefers separation of food and state.

  • Retailers Should Keep Consumers -- Not Greens -- In Mind

    May 30, 2013 2:27 PM

    culture-of-alarmism_ltrAs part of its Culture of Alarmism project, the Independent Women’s Forum (IWF) has recently launched a coalition letter -- which includes CEI -- to retailers to combat the greens so-called “Mind the Store" campaign. We (IWF, CEI, and 21 other groups) advise retailers to ignore radical greens' advice to remove certain products from store shelves, and instead honor consumer freedom.

    The greens' effort, led by Safer Chemicals, Healthy Families, calls on the nation’s top 10 retailers -- Walmart, Kroger, Target, Walgreens, Costco, Home Depot, CVS Caremark, Lowe's, Best Buy, and Safeway --to remove a wide range of useful products from store shelves because they contain one of 101 so-called hazardous chemicals.

    According to this group:

    Since we began in 2009 the evidence that unregulated chemicals are having profound health impacts has only grown. The Presidents Cancer Panel report and the recent United Nations report are just two examples. (Our own report summarizes the state of the science linking chemicals and various health impacts here.) And yet the government is too slow to respond in the face of chemical industry opposition.

    In reality, there is no compelling evidence that trace chemicals in consumer products pose significant risks, particularly when used as directed. As I noted in a recent IWF paper on cancer, the President's Cancer Panel report is a political document, not a scientific study and its claims have been rebuked by reputable cancer researchers. The IWF paper and material found on CEI's SafeChemicalPolicy.org offer lots of other reasons why consumers should not be alarmed by these products.

  • Regulatory Opacity

    May 30, 2013 11:29 AM

    In today’s Investor’s Business Daily, Wayne Crews and I make the case that one of the biggest obstacles to regulatory reform is a lack of agency transparency.

  • TTB to Allow, Not Require, Nutritional Labeling on Alcoholic Products

    May 30, 2013 11:28 AM

    It’s a rare occasion that we get to praise government agencies. While the federal agency governing alcoholic beverages certainly took it’s time to make a ruling on nutrition labeling on alcoholic products -- a topic it has been considering since 2003 -- it appears the Alcohol and Tobacco Tax, and Trade Bureau (TTB) ultimately made the right decision to allow, not require, companies to add a “serving facts” nutrition panel to their labels. According to a press release dated May 28, 2013, the TTB reviewed the issue of having a “serving facts” statement on beer, wine, and spirits -- something that the spirits suppliers have been asking for -- and it concluded that it will allow, but not require the use of nutrient analysis in labeling as well as advertisements.

    Happily, companies will not have to apply for approval for a new label, so long as the added nutritional facts panel follows the example provided by TTB and they may include information regarding the serving size, number of servings in a container, calories, carbs, protein, and fat per serving.

    This is good news because there had been some talk in the past about requiring all suppliers of alcohol to add this nutritional information to all of their products, a change that could have been disastrous for some smaller producers of alcohol and consumers who like variety. As I wrote back in 2011:

  • Education Department Attack on Free Speech and Due Process Criticized in Washington Post, Chronicle, and Other Papers

    May 29, 2013 10:00 AM

    Earlier, I wrote about a recent letter from the Education and Justice Departments demanding that the University of Montana define as a reportable "sexual harassment" offense "any" speech on sexual topics that is "unwelcome" to any listener, even if most listeners do not find it "unwelcome," and it would not offend the "reasonable person." This pretty obviously violates the First Amendment, as I explain here in the Chronicle of Higher Education at this link.

    The government calls this letter a "blueprint" for the nation's colleges and universities to use. If the colleges follow this "blueprint," they will open themselves up to First Amendment lawsuits, as The Washington Post's George Will notes, quoting civil libertarians (and me) objecting to the government's demands. Other op-eds criticizing the government's demand for censorship, such as Wendy Kaminer's commentary in The Atlantic, and syndicated columnist Mona Charen's op-ed, can be found here, here, and here.

    The government's demands also disregard past government guidance as to what constitutes "sexual harassment"; Supreme Court decisions defining sexual harassment and rejecting college curbs on "indecent" speech in campus debates; and rulings by the U.S. Third Circuit Court of Appeals, and federal district court judges, striking down campus sexual harassment codes that restricted speech protected by the First Amendment.

    As George Will notes,

    The OCR-DOJ “blueprint” requires, Kaminer says, colleges and universities to hear harassment complaints under quasi-judicial procedures “that favor complainants.” Under 2011 rules that establish a low standard of proof, Kaminer says, “students accused of harassment are to be convicted in the absence of clear and convincing evidence of guilt, if guilt merely seems more likely than not.” And schools are enjoined to “take immediate steps to protect the complainant from further harassment,” including “taking disciplinary action against the harasser” prior to adjudication. So the OCR-DOJ “blueprint” and related rules not only violate the First Amendment guarantee of free speech but are, to be polite, casual about due process.

    Hans Bader, a former OCR lawyer now with the limited-government Competitive Enterprise Institute, notes that this “Alice in Wonderland” — “sentence first, verdict afterwards” — system “casts a cloud over academic freedom and the ability to discuss topics that are offensive to some listeners.” Indeed, to one listen

  • Canada Not Happy with New Country of Origin Labeling Rules

    May 28, 2013 3:40 PM

    trade1Protectionism through non-tariff trade barriers is alive and well in the trade arena, even with the U.S.’s largest trading partner, Canada. New U.S. Department of Agriculture regulations on mandatory Country of Origin Labeling (COOL) for meat and some other commodities aim to comply with a 2012 World Trade Organization decision on a dispute brought by Canada against the U.S., but fall short of that mark and may open the door to Canadian trade retaliation.

    When the U.S. regulations were issued May 23, 2013, the Canadian government issued a statement asserting that the rule does not comply with the WTO ruling, would significantly increase costs for producers in both Canada and the U.S., and damage the meat and pork producing industries. The statement also said that Canada “will consider all options at its disposal, including, if necessary, the use of retaliatory measures.”

    The current brouhaha arose from U.S. regulations that were dictated in the 2008 farm bill, which required retailers to notify their customers of the country of origin of certain commodities, including meat. The difficulty arose because beef and pork are part of an integrated multi-country supply chain among Canada, the U.S., and Mexico, where cattle or pigs may be born in one country, raised in another, and moved to the U.S. for slaughtering. To label the final product as “Made in America” required that all of those stages be carried out in the U.S.

    When the rules were issued, Canada and Mexico brought a complaint to the WTO that the rules discriminated against those two countries and were in violation of the WTO Agreement on Technical Barriers to Trade. A WTO dispute panel ruled last summer that indeed the COOL regulations were a violation and gave the U.S. until May 23, 2013, to bring its rules into compliance.

  • How to Have Enough Water for Everybody

    May 28, 2013 11:00 AM

    Last week I testified in the Water and Power Subcommittee in the House of Representatives (hearing linked here). The concern was water availability and federal funding for for research and development in desalinating (de-salting) seawater and brackish water for human consumption or use in irrigation or industry.

    I argued against the funding and pointed out that water shortages are almost always rooted in poor pricing for water. Without market pricing, scarcities and havoc will rule. I call for the separation of water and state. My long-form written testimony is linked here, and my oral comment appears below.

    I am Wayne Crews, VP for Policy at the Competitive Enterprise Institute and I thank the committee for the invitation to speak on federal desalination efforts that, while they won't break the fiscal bank, distract from the infrastructure and regulatory liberalization actually needed, and embrace principles at odds with an adaptable and lightly regulated water sector.

    Desalination does boast impressive working applications, but it is an energy-intensive, by-product-laden way to make expensive potable water.

    Happily, water is not getting more scarce overall; it’s an earthly constant.

    But pricing and allocation of that constant water supply do matter. We should avoid having Government Steer While the Market Merely Rows.

  • More than Taxing and Spending

    May 28, 2013 10:33 AM

    The cost of government is far more than it taxes and spends. The Pittsburgh Tribune-Review’s editorial board agrees, as they opined yesterday:

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