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OpenMarket: January 2009

  • CA Restaurant & Bar Owners (not drinkers) Will Feel the Pinch of Nickel Tax

    January 28, 2009

    February 1st 2009 is the day that California Governor Arnold Schwarzenegger's per-drink tax increase will go into effect throughout the state. The tax hike will be a seemingly small 5 cent increase on beer, wine, and spirits in an attempt to in an attempt to shrink the state’s budget deficit of $40 billion.

    Is this a wise idea? Well, “sin taxes” like those applied to drinking and smoking are, generally, intended as deterrents against an activity some government agent believes is harmful to “the public”. But discouraging people from drinking in California is like Vegas charging gamblers extra money each time they place a bet in a...

  • Al Gore, the lobbyist

    January 28, 2009
    In a letter dated January 26th, 2009 Al Gore’s company Generation Investment Management sent a coalition letter along with other institutional investors representing $1.7 trillion in assets to Senate Majority leader Harry Reid. The letter asked for: 1) longer-term economic incentives including extending the Production Tax Credit (PTC) for five years or more, 2) funding for energy efficiency programs – such as retrofitting buildings, 3) federal funds to flow to states that allow utilities to treat energy efficiency comparable to new supply; states that adopt energy efficiency resources standards to achieve energy savings goals; or, states that adopt strong building codes to encourage energy savings, and 4) that part of the funding in the stimulus package should be directed toward modernizing and improving the electric grid system. Today, two days later,  Al Gore, The Climate...
  • Liveblog of Al Gore Climate Hearing

    January 28, 2009
    No TV station seems to be covering this live, but you can watch here. Kerry in his introduction says "if there was a cost-free way of tackling climate change, we'd take it, but there isn't." There is (at least comparatively) - adaptation - and Kerry, Gore and their ilk have stood in the way of research and implementation of adaptation. Lugar makes this point in a slightly confused fashion (and gives too much credence to the finagled Stern Report), but eventually gets good on the subject of biotech. Gore links global warming, financial crisis and terrorism as all caused by our use of coal and oil. How convenient for him. Oh, and China as well. Urges Congress to pass "the entirety" of the shtimulus bill. Presumably including the resodding of the National Mall as a vital step in combating the climate crisis. Says...
  • 200 Economists Oppose the Stimulus Plan

    January 27, 2009
    CEI has been vocal in its opposition to the stimulus plan. Turns out, we're not alone. The Cato Institute has collected the signatures of 200 economists who believe that "Lower tax rates and a reduction in the burden of government are the best ways of using fiscal policy to boost growth."
  • Is the TARP Unconstitutional?

    January 27, 2009
    Also at Heritage today, FreedomWorks chief economist Wayne Brough described his organization's legal analysis of the constitutionality of the Troubled Assets Relief Program. "There is a very strong non-delegation argument against the TARP," he said. "They basically took all the debate out of the Congress and put it all in the Treasury in the Executive branch...They gave the Treasury a $700-billion blank check to spend at whim." For more on bailouts, see, a project of the Competitive Enterprise Institute and the National Taxpayers Union, as well as John Berlau's entry on bailouts in CEI's new Agenda for Congress.
  • DeMint's Smaller-Government Stimulus

    January 27, 2009
    This week, Senator Jim DeMint (R-S.C.), in response to President Obama's stimulus plan, announced his own alternative stimulus package, which David Weigel, at the Washington Independent, summarizes thus:
    • Make the Bush tax cuts permanent and “take uncertainty out of the economy.” • Let small businesses “write off more of their business expenses.” • Cut the top corporate tax rate from 35 percent to 25 percent. • Cut the capital gains tax. • Cut spending and “reign in the out of control congressional earmarking practice.”
    This would encourage investment in the most productive sectors of the economy, unlike Obama's proposed $825 billion of increased spending, which DeMint criticized today at the Heritage Foundation. Of the infrastructure component of the stiumulus, he said that, "Less than 10 percent...
  • Clinton: World "Exhaling" Under Obama?

    January 27, 2009
    Secretary of State Hillary Clinton reportedly declared "There is a great exhalation of breath going on in the world as people express their appreciation for the new direction that's being set and the team that is put together by the president."  That's a cute contrast to President Bill Clinton's claim that he "didn't inhale." Different context, perhaps, but it is change.
  • Kiss Off to Consumers

    January 27, 2009
    The appropriations portion of the House stimulus bill is not the only legislation with bad ideas.  The House Energy and Commerce Committee has also marked up their portion of the stimulus package.  During the Committee markup, Chairman Henry Waxman (D-CA) inserted a provision that would “decouple” utility rates from the amount of electricity or natural gas that the utilities sell.  According to the “decoupling” provision, states that accept federal energy efficiency grants from the economic stimulus package will have to ensure that utilities recover the revenue lost when consumers use less energy. In other words, in states that accept the energy efficiency grants, utilities that use the grants to help consumers lower the energy consumption will be able to raise their rates to compensation for the loss in revenue.  Consumers who participate in the programs may see their energy use go...
  • Green Pork

    January 27, 2009
    In addition to tens of billions of dollars in the House stimulus bill for infrastructure and other projects to create jobs, there are also funding items that appear to do the exact opposite.  For example, the House stimulus bill contains $175 million dollars for Natural Resource Conservation Service to purchase conservation easements in floodplains.  Funding for the program would effectively be spending tax dollars to pay farmers to stop farming.  Not only would such conservation easements not be creating any jobs, they actually would likely be doing the opposite by taking farmland out of production. What makes this funding even more egregious is that removing farmland from production tends to increase food prices.  What makes this provision seem even more out of place is the House stimulus bill also includes $200 million in funding for Senior Nutrition Programs, claiming the programs...
  • When the Irreversible Effects Meet the Immovable Policy

    January 27, 2009
    Apparently, global warming is now irreversible. Or, at least, it is if you don't consider any of the policy options that might, you know, reverse it. As Roger Pielke Jr points out, the study didn't examine the potential for geoengineering:
    Geoengineering to remove carbon dioxide from the atmosphere was not considered in the study. “Ideas about taking the carbon dioxide away after the world puts it in have been proposed, but right now those are very speculative,” said Solomon.
    Then only reason geoengineering remains speculative is because the global warming industry is locked into one policy model: mitigation. If...


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