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OpenMarket: May 2009

  • Stimulus Package Shrinks Economy, Destroys Private Sector Jobs

    May 31, 2009
    Most of the $800 billion stimulus package has yet to be spent, but it's already harming the economy, both by triggering trade wars that have cost at least 40,000 jobs, and by driving up interest rates for businesses that need to borrow money to expand or create jobs. (The government is keeping down interest rates on its own debt by printing vast sums of money to buy its own bonds, in order to finance the exploding national debt, which will result in massively higher taxes). As economist...
  • Wasteful Obama Auto Bailouts Disturb Even Liberal Washington Post

    May 30, 2009
    Even the liberal Washington Post, which endorsed Obama and has not backed a Republican for president since 1952, is getting fed up with the Obama Administration's wasteful and politicized bailouts of General Motors and Chrysler. Today, it laments the "imminent transformation of General Motors into a government-owned company, infused with upward of $50 billion in federal money." "It doesn't take much imagination to forecast the political pressures that will buffet the government-as-auto-executive. We've seen one effect already in the preferential...
  • Against Freedom, Against Art, Against Reality

    May 29, 2009
    The crusade against film depictions of tobacco smoking is once again gaining momentum. The American Medical Association Alliance, in coalition with several other well-funded special interests, has launched a campaign called “Which Movie Studios Will Cause the Most Youth to Start Smoking This Summer?” The campaign, among other things, calls for an automatic "R" rating for any movie that depicts tobacco smoking. The New York Times reports:
    Studios, under pressure from health groups, have been urging filmmakers to trim tobacco scenes but have balked at an outright ban, citing the need for artistic license. An association spokeswoman, Angela Belden Martinez, noted that the movie industry now includes antismoking announcements on DVDs. “The industry understands the concerns of parents about smoking...
  • The AFL-CIO's "Creative Accounting"

    May 29, 2009
    The AFL-CIO has obscured its poor financial condition through "creative accounting," says Machinists union President Tom Buffenbarger, reports Associated Press.
    Tom Buffenbarger, president of the International Association of Machinists and Aerospace Workers, said in a report that the labor federation obscured its financial difficulties heading into last year’s presidential election campaign, in which it backed Democrat Barack Obama. Net assets of the 11 million-member AFL-CIO declined to a negative $2.3 million as of June 30, 2008, from a $66 million surplus on July 1, 2000. “A new leadership — leaders chosen by our members, leaders help accountable by our members — is needed,” wrote Buffenbarger, who is a member of the AFL-CIO’s finance...
  • Obama Justice Department Winks at Racist Voter Intimidation

    May 29, 2009
    Black Panthers in Philadelphia used nightsticks and racial epithets to drive white voters away from a polling place. "Career lawyers pursued the case for months, including obtaining an affidavit from a prominent 1960s civil rights activist who witnessed the confrontation and described it as 'the most blatant form of voter intimidation' that he had seen, even during the voting rights crisis in Mississippi a half-century ago." But Obama's political appointees at the Justice Department overruled them, dropping the case after victory was already assured because "the court...
  • Anti-GMO Zealots vs. Starving Zimbabweans

    May 29, 2009
    In Zimbabwe, the most food aid-dependent country in the world, officials and self-styled "consumer activists" have begun raiding shops suspected of selling genetically-modified food, The Zimbabwean reported earlier this week.
    [The Consumer Council of Zimbabwe] which fights for the rights of consumers last week started to inspect and recommend that shops selling GMO foods should be closed. CCZ said the GMO foods which have flooded Zimbabwe were mostly powered milk, meal-mealie, rice and chicken. “We have received a lot of reports of people, mainly children, getting sick after consuming the foods which in most cases will be expired,” said Comfort Muchekeza, the CCZ spokesperson. “We...
  • The Cost of Cybersecurity in Context

    May 29, 2009
    During his remarks, President Obama noted that "cyber crime has cost Americans more than $8 billion." He continued, "My presidency has so far cost Americans more than $4 trillion."
  • Does the ethanol mandate increase CO2 emissions?

    May 27, 2009
    That may seem counter-intuitive, because burning ethanol merely puts back into the air the carbon dioxide (CO2) that corn crops recently pulled out of it, whereas burning gasoline liberates carbon that had been stored in geologic deposits for millions of years. But other factors come into play, such as the fossil energy inputs required to produce the corn, turn it into ethanol, and deliver the ethanol to market.  In addition, as EPA argues in its proposed rule to implement the renewable fuel standard program established by the 2007 Energy Independence and Security Act (EISA), expanding corn production into forest and grass lands can release substantial amounts of carbon stored in soils and trees. Similarly, when U.S. farmers grow corn in areas previously used to produce soy beans, for example, farmers in Brazil have an...
  • More Bailouts at Taxpayer Expense

    May 27, 2009
    Mortgage lenders are getting even bigger taxpayer subsidies to write off mortgage loans for potentially delinquent borrowers, reports today's Washington Examiner. "President Barack Obama last week created another subsidy for home lenders, boosting benefits to lenders under the 'Hope for Homeowners' program created last summer. Under the 2008 law, Washington guarantees loans if lenders gave favorable terms, including principal reduction. The amendment Obama signed last week heightens cash payments to lenders and loosens standards." It's not just lenders who are getting federal payments for writing off loans, but also companies that service loans without owning them. The servicers now have a financial incentive...
  • Laffer Curve No Laughing Matter

    May 26, 2009
    The Laffer curve is the economic model that purports to demonstrate that by decreasing marginal tax rates, tax receipts may actually increase. It is a central concept of supply-side economics, famously denounced by George H.W. Bush as "voodoo economics" during his Republican presidential primary run against Ronald Reagan. Setting aside the debate over what constitutes an "optimal level of taxation" and the Laffer curve's other political implications, Maryland provides a good example of how "soak-the-rich" tax policies can lead to disastrous fiscal results. From the Wall Street Journal:
    Maryland couldn't balance its budget last year, so the state tried to close the shortfall by fleecing the wealthy. Politicians in Annapolis created a millionaire tax bracket, raising the top marginal income-tax rate to 6.25...

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