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OpenMarket: December 2007

  • Friedman colleague to Fed: Stop throwing money at credit crunch

    December 28, 2007
    Anna Schwartz, longtime colleague of the late Milton Friedman and celebrated free-market economist in her own right, had some interesting things to say about the current credit crunch. In a story published on December 23 in the London newspaper the Telegraph, Schwartz told reporter Ambrose Evans-Pritchard that the buckets of money being thrown into the system by central banks in the U.S. and Europe were not getting to the root of problem. In fact, they were probably making things worse. “Liquidity doesn't do anything in this situation,” Schwartz said. “It cannot deal with the fear that lots of firms are going bankrupt.” Schwartz's comments are especially significant given that in her research with...
  • "Every obese adult started eating as a child."

    December 27, 2007
    ---As CEI's prez Fred Smith will tell you. Over the holiday, our friend Sally Pipes at the Pacific Research Institute penned a Washington Post oped called "Brave New Diet" on the growing food police movement in America, pointing out some bugs in the "BMI" calculus and making other observations about sensible, healthy behavior. Indeed, a lot of us are overweight and don't exercise. But as Sally says:
    People make choices. And government should protect -- not restrict -- the freedom to make those choices so long as we're not harming others. While we may not always like the choices others might make, it is essential that we all have the freedom to choose for ourselves. Once we accept the idea that the Nanny State should step in when it's "for our own good," we've...
  • CIGNA Mistakes? Maybe, but Murder...?

    December 26, 2007

    Imagine you are going on vacation and you pay your neighbor to tend to the hanging plants you have outside of your house. While you're gone the weather turns and a frost sets in, eventually killing all of your plants. You return home and are understandably distraught to find out that your neighbor neglected to bring your plants indoors,  allowing them to perish in the harsh elements.  You promptly file vandalism charges against your neighbor for the damage done to your plants.  I'd wager that no court, (even one in California) would agree to hear a case on those grounds. I am willing to bet, however, that California courts will entertain the...

  • Diversity Training Backfires

    December 26, 2007
    Employers pay a lot of money for diversity training and sexual harassment training, but often the training backfires and blows up in the face of the employer that paid for it.  In Hartman v. Pena (1995), the Federal Aviation Administration got sued for sexual harassment after it subjected employees to three days of diversity training that scapegoated white males.  After a federal judge refused to dismiss the case against it, the agency had to pay out a settlement to the white male employee who sued. Diversity training often imparts bad legal advice to managers and employers that can come back to haunt them in court.  Gail Heriot, a law professor and member of the U.S. Civil Rights Commission, reports on the sexual harassment training she received at the University of San Diego, in a state (...
  • Christmas Choral Music and What it Says About America

    December 26, 2007
    It's Christmas Eve (although you probably won't read this until some time after) and I'm sitting in front front of the television now watching the St. Olaf College Christmas Festival. This morning I listened to the radio broadcast of the Festival of Nine Lessons and Carols from the famous King's College Chapel at Cambridge University. Both festivals date from the early decades of the 20th century, both are widely listened to around the world, and both involve lots of wonderful Christmas music. For professionalism and pomp, however, Cambridge's presentation beat St. Olaf's. This shouldn't surprise anyone: the Cambridge event takes place at one of the world's top universities, in an ancient and iconic building, and involves the 100 or so top musicians from a...
  • Rent seeking or lack of private insurance markets?

    December 26, 2007
    Monsanto has talked the federal government into giving farmers a break on their crop insurance if they use crops that produce pesticides. If other companies are involved in this too, it is a good thing--it is reasonable that lower risk crops should have a lower premium. It is not reasonable that only Monsanto's pesticide producing crops should be considered lower risk. The greens are crying foul though; they claim this is rent seeking and corruption, government should not "endorse a product" they argue. I would have to agree, but they have defined the problem wrong. The government should not be involved in crop insurance in the first place. If this was a private market, the risk assessment would not be considered a political move on the part of USDA.
  • New Energy Law Needs to be Flushed

    December 26, 2007
    Leave it to Congress to make things worse under the guise of promoting new energy sources and environmental protection.  If you want to understand how government mucks up the market, explains Ben Lieberman of the Heritage Foundation, just look back a few years:

    If it's a low-flush toilet, that is. These water-stingy models were mandated under the 1992 Energy Policy Act. After the provisions took effect in 1994, millions of Americans remodeling their bathrooms came in for an unpleasant surprise. Many of the new water-saving toilets cost more and performed worse than the ones they replaced. Homeowners complained that they had to flush more than once, which, in addition to being annoying, cut into the water conservation purpose behind the law. It took many years before the bugs were worked out of the new...

  • Private or Government Health Care: Who Gets to Choose?

    December 26, 2007
    There may be no less appreciated industry than insurance.  We hate paying for it and hope never to use it.  If we make a claim, the company is devoted to protecting its own interest irrespective of what we want. The health insurance industry naturally yields up more than a few "Roger Moore" moments, examples of denial of benefits which, no matter the justification, look like examples of greedy corporations sacrificing helpless people.  Cigna has recently been hit over its initial denial of a liver transplant to a young leukemia patient. But there are no easy choices, and a government takeover of the medical system doesn't make the decisions any easier.  Observes Investor's Business Daily:
    Any insurer, public or private, would have had to make the same tough calls that Cigna did. It's...
  • Gingerbread wars in Europe

    December 26, 2007
    Now the Italian food police are after my cultural heritage! The Italian version of FDA is concerned that Swedish gingerbread has too high levels of coumarin. Coumarin constitutes the skeleton of many flavanoid compounds, or to put it more succinctly, coumarin is the building block of many flavorings we use in our food, such as cinnamon. The Swedes don't really think it is a problem, but then the Italians probably haven't discovered Surströmming yet, which is...
  • Crisco, and invented food made by chemist, now give me a slice of pie!

    December 26, 2007
    I have an issue with this holiday fuzzy feeling piece from Marketplace, because the anchor's intro goes as follows: "Crisco is a staple in many American kitchens and a must-have for homemade pies. But it's also an invented food made by chemists …" An invented food made by chemists, how little does a reporter have to know about the history of food to know that most all of it is made by chemists? Those chemists are often called, mom, pop, grandma, and grandpa, but they are chemists none the less. Beer and wine are two items that were "invented and made by chemists", the same goes for pickling and curing and canning and most other cooking and preservation techniques. And while we are on the subject of pies and Crisco, here's my friend Miranda baking Lemon Meringue pie while she is chatting...


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