Gas Prices, the Federal Reserve and Insurance Regulation
Senator Barbara Boxer (D-CA) claims that the global warming legislation she recently endorsed would not result in an increase in gas prices.
Federal Reserve Bank of New York President Tim Geithner calls for more power for the Fed to prevent financial crises.
A House of Representatives subcommittee considers a proposal to create a federal insurance information agency.
1. CONSUMER
Senator Barbara Boxer (D-CA) claims that the global warming legislation she recently endorsed would not result in an increase in gas prices.
CEI Expert Available to Comment: Energy Policy Analyst William Yeatman corrects Sen. Boxer’s inaccurate characterization:
“Under the Lieberman-Warner ‘cap and trade’ scheme, industrial users and suppliers of energy would have to buy the right to emit greenhouse gases from an annual government-run auction, whereas now these emissions are free. But businesses would not simply absorb higher input costs; instead, they would pass along the burden to consumers. That’s why, in a report released last April, the Congressional Budget Office says that ‘most of the cost of meeting a cap on CO2 emissions would be borne by consumers, who would face persistently higher prices for products such as electricity and gasoline.’”
2. FINANCE
Federal Reserve Bank of New York President Tim Geithner calls for more power for the Fed to prevent financial crises.
CEI Expert Available to Comment: Center for Entrepreneurship Director John Berlau on how Geithner is trying to change the Fed’s role:
“Geithner was the Fed official most responsible for putting together the deal to sell Bear Stearns to JP Morgan Chase and bail out Bear Stearns’ creditors. Syndicated columnist Robert Novak called Geithner the ‘initiator’ of the bailout, and wrote a very disturbing account of how Geithner — a former Clinton administration Treasury appointee who is not an economist — crafted the plan that the Bush administration basically just rubber-stamped… Now Geithner uses the bailout he rammed through to argue that the Fed’s role has changed, and now that it has assumed the responsibility for bailing out investment banks, it needs to add regulations as well.”
3. INSURANCE
A House of Representatives subcommittee considers a proposal to create a federal insurance information agency.
CEI Expert Available to Comment: Senior Fellow Eli Lehrer on how a new information agency could help consumers:
“A proposal recently introduced in Congress, the Insurance Information Act of 2008 (H.R. 5840), would create a new Office of Insurance Information (OII), which, if enacted as a stopgap measure, and not as a policy end point, would begin the process of removing impediments for U.S. firms to operate in a liberalized national – and ultimately international – environment. The creation of this office would represent an incremental – though temporary – step in efforts to open America’s insurance markets to greater competition and innovation.”
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FOR MORE INFORMATION
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