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OpenMarket: April 2009

  • A Bounty on Your 401(K)

    April 6, 2009
    The Obama Administration's mortgage bailout for irresponsible borrowers (including wealthy borrowers with modest mortgage payments) provides a bounty for reckless sub-prime mortgage lenders like Countrywide to rip off your retirement plan. Countrywide sold its junky mortgages on Wall Street, where they ended up being owned by mutual funds that probably are in your 401(K). But it continued to service the mortgages and make money doing so.
  • The newest altruist: Fidel Castro

    April 6, 2009
    “The financial crisis is not the only problem. There’s another worse one, because it has to do not with the means of production and distribution but with our very existence. I’m referring to climate change. Both are here and will be discussed simultaneously,” Castro said in the latest of his commentaries on current events.," according to the Latin American Herald Tribune. He'll fit right in with the altruistic designers and promoters of the Waxman-Markey bill, which is "modeled closely on the recommendations of the U.S. Climate Action Partnership (USCAP)"  industry lobbying organization.
  • "Newspapers are dying; Are universities next?"

    April 3, 2009
    Wikinomics warns that non-elite colleges risk the same plight now facing newspapers. Rarely do the dominant industries lead innovation, and in the case of the papers:
    [L]eaders of old paradigms have the greatest difficulty embracing the new. Why didn’t Gannett create The Huffington Post? Why didn’t NBC invent YouTube? Why didn’t AT&T launch Twitter? Yellow Pages should have built Facebook and Microsoft should have come up with Google. And Craigslist would have been a perfect venture for the New York Times.
    As for the universities:
    But less-selective private colleges and regional public universities, by contrast - the higher-education equivalents of the city newspaper - are in real danger. To survive and prosper... universities...
  • Crucial Military Votes Excluded in New York Special Election

    April 3, 2009
    The outcome of a special Congressional election in New York's 20th Congressional District will likely turn on the illegal exclusion of up to 1,000 overseas military ballots, which otherwise would have tipped the race in favor of James Tedisco (R). Tedisco and Scott Murphy (D) are in a dead heat, with 77,225 votes each. Democrats on the state elections board blocked GOP attempts to allow overseas military voting in the special election. Overseas ballots take weeks to reach voters and be returned unless...
  • That G20 Communique

    April 3, 2009
    Yesterday’s communiqué from the leaders of the G20 – a motley collection of democracies and dictatorships – has some good points, but in general it represents a new version of what economist Friedrich Hayek called “the fatal conceit.” It believes that government has all the answers, and demonstrates that the world's leading governments recognize few boundaries. As such, not only does the communiqué promise far more than it can deliver – something the voters in G20 democracies should remember – but it may also impede global economic recovery. The communiqué holds that, “We start from the belief that prosperity is indivisible; that growth, to be sustained, has to be shared” and to “do whatever is necessary.” In clause after clause, this pro-government rather than pro-prosperity declaration...
  • Climate alarmists call for more groupthink

    April 3, 2009
    Nothing is more Orwellian than quoting Orwell to attack freedom of thought and discussion. Today's ClimateWire (subscription required) provides a case in point. "Scientists need to stop doublespeak on climate, [PR] experts say," reports Christa Marshall. By doublespeak, Orwell meant a political orthodoxy so pervasively embraced as a party line that everybody sheepishly repeats and even believes manifest falsehoods: Ignorance Is Strength, Freedom Is Slavery, War Is Peace. But to the PR experts cited by Marshall, "doublespeak" means that the world's scientists, journalists, and government agencies do not all speak about climate change with one voice. Because of this "doublespeak," say the experts, "The dangers of global warming are not getting through to the public." I have a better explanation. Blaming SUVs for...
  • Regulation of Local, Non-Interstate, Non-Commercial Conduct OK'd

    April 2, 2009
    Congress's power under the interstate commerce clause has been interpreted by a legion of court rulings to reach even non-commercial, local conduct that doesn't cross state lines! Some of those rulings smack of judicial activism. Here are some examples of rulings allowing even local, non-interstate activity to be regulated under the interstate-commerce clause: (1) Wickard v. Filburn, 317 U.S. 111 (1942) (Supreme Court rules that farmer's growing of grain on his own farm, for purposes of consumption, was subject to regulation under the interstate Commerce Clause); (2) Gonzales v. Raich, 545 U.S. 1 (2005) (Supreme Court rules that consumption of locally-grown medical marijuana not even sold, miuch less sold across state lines, can be...
  • The mark-to-market relief rally

    April 2, 2009
    The events leading to the Dow's climbing over 8000 today can be properly called the Mark-to-Market Relief Rally. More than any expected action of the bureaucrats and politicians at the G20, the decision today of the Financial Accounting Standards Board (FASB) to relax strict application of mark-to-market accounting mandates, urged on by members of Congress of both parties, it what's giving investors something to cheer for. In this era that supposedly signifies the return of big government, it is heartening that on this issue, Republicans and Democrats worked together to push for this common-sense free-market reform that will do much to get our economy going and could save taxpayers billions in avoiding the need for bailouts. In CEI’s recently released “...
  • Could carbon capture and storage keep the lights on in a carbon-constrained future?

    April 2, 2009
    Only if the costs decline dramatically, a recent Congressional Research Service report suggests, as I discuss here. Currently, the costs of carbon capture and storage (CCS) are too high to justify continuing investment in coal-based power--the source of 50% of U.S. electricity--under increasingly stringent caps or taxes on CO2 emissions. In addition, the storage component of a CCS system must be very nearly leak proof or it will flunk federal environmental impact assessments. As Cal Tech chemist Nathan Lewis observes, "The collective leak rates of the reservoirs must be significantly lower than 1%, sustained over a century-to-millennium time-scale. Otherwise, after 50 to 100 years of...
  • Markets Rally on Hopes of Regulatory Relief

    April 2, 2009
    The stock market has gone up by 280 points so far today, fueled by FASB's vote to relax rigid mark-to-market accounting rules, which require financial institutions to value assets at their current fire-sale prices, and magnify boom-bust economic cycles. The market may also be getting a boost from the Senate's earlier vote undercutting the Obama Administration's proposed $...

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