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OpenMarket: February 2013

  • The Dangers Of Crying Wolf On BPA

    February 28, 2013 5:43 PM

    Anyone with an interest in the science of bisphenol A (BPA)--a chemical used to make hard, clear plastics and resins that line food containers -- should read Trevor Butterworth's recent Q&A with researcher Richard M. Sharpe, who specializes in male reproductive health issues at the University of Edinburgh.

    I've commented many times on significant problems surrounding many of the recent studies on BPA and how hype about its risks can harm human health. Sharpe has been critical as well, and in December 2009, he lamented:

    "research on Bisphenol A has ... become literally bogged down in the mire of controversy, much of which stems from the earliest findings and seems to have little to do with the current state of the science ... Fundamental, repetitive work on bisphenol A has sucked in tens, probably hundreds, of millions of dollars from government bodies and industry which, at a time when research money is thin on the ground, looks increasingly like an investment with a nil return."

    Judging from the Butterworth's interview things have not changed much. Sharpe notes some additional dangers that arise from alarmist journalism and bad science:

  • Chicken Little Lives Vicariously Through Federal Union Bosses

    February 28, 2013 2:21 PM

    We know the story of Chicken Little. The little chick thought the sky was falling because he was hit in the head by an acorn. He convinced the other barnyard animals that the sky was falling and soon they were all in hysterics.

    Well, when it comes to sequestration cuts impact on federal employees, union officials have adopted a Chicken Little approach. Feeding Big Labor’s frenzy is tomorrow’s March 1 sequestration deadline with no deal to delay budget cuts in sight.

    For the past few weeks, federal union leaders have been lobbying anyone who will listen to deflect cuts away from federal workers in favor of anything else. Today in U.S. News and World Report, I criticize these union officials, which many never do any government work:

    When President Carter signed the Civil Service Reform Act in 1978, he said he did so to "promote the general welfare, contribute to the effective conduct of public business and to facilitate and encourage amicable settlements of labor-management disputes." He said nothing about creating dozens of jobs within government devoted solely to the conduct of union business. But that is precisely what has happened.

    According to records obtained by Americans for Limited Government through Freedom of Information Act requests, the Department of Transportation had 35 employees who did nothing but union work in 2012, and the Environment Protection Agency had 17. All 52 made at least $72,000 per year, and 37 made more than $100,000.

  • Progressives Should Be Wary Of A Minimum Wage Increase

    February 28, 2013 12:28 PM

    Over at the American Spectator, I argue that progressives should look elsewhere for ways to help the poor:

  • Wells Fargo Economists: Sequestration Helps The Economy In The Long Run

    February 28, 2013 12:28 PM

    Yet again, the Obama administration is busy engaging in scare tactics about sequestration, inflating its impact on the government and the country (to the point of falsely claiming it will result in budget cuts at an non-existent agency that closed its doors last June).

    But in reality, the sequestration's automatic budget cuts will help the economy in the long run, as we previously pointed out. Wells Fargo's chief economist now says that the sequestration will be economically helpful in the long run, much for the reasons I have given in the past. It will "eventually help the economy grow faster than it would have otherwise," since "the sequester will reduce future budget deficits — and with them the odds of federal borrowing costs increasing several years from now."

    As Wells Fargo's chief economist John Silvia and a colleague noted on page 3 of their recent report, "Should the Congress and the administration decide to cancel the sequestration completely without replacing the cuts, the result would be a lower long-run rate of economic growth stemming from higher budget deficits today and higher federal interest outlays in the future. In addition, there is a significant likelihood that the United States would face another debt downgrade, and, in turn, raise the possibility of higher interest rates." "Should the sequestration be reversed or canceled," noted Silvia and Wells Fargo economist Michael Brown this week, "the result would" come "at the cost of reducing the long-run rate of growth of the U.S. economy."

  • VAWA Bill Likely To Pass Congress This Week, Despite Violating First Amendment

    February 27, 2013 3:29 PM

    Congress never lets the Constitution get in the way of passing a law with a catchy title. Thus, the Senate’s version of the bill reauthorizing the Violence Against Women Act will likely pass the House this week, even though UCLA law professor Eugene Volokh, a leading First Amendment scholar, earlier noted that provisions in it violate the First Amendment. (Legal scholars have criticized other provisions in the bill as violating Articles II and III of the Constitution, and for undermining due-process safeguards.) The House GOP had earlier objected to the Senate's version, citing various flaws in the bill, but under political pressure, some GOP members in swing districts have switched sides and endorsed the bill, which is backed by Democratic leaders and the White House.

  • The Myth Of British Austerity, And Why It Was Concocted

    February 26, 2013 5:20 PM

    Opposition to spending cuts in America has been based heavily on "the myth of British austerity," even though "if the British government is practicing austerity it is hard to see," since government spending still consumes half of Britain's GDP, and government spending there is virtually unchanged.

    Indeed, spending is "projected to" grow modestly in England over the next few years. If England is not actually practicing austerity, why have critics of austerity falsely made Britain the poster child for austerity? A commenter at Bloomberg explains it in a nutshell: due to the United Kingdom's structural economic weaknesses, and its heavy dependence on the devastated and anemic financial sector, Britain will underperform much of the world over the next few years no matter what it does. So whatever government policy is associated with it will look bad by association -- giving those who oppose austerity, like Paul Krugman of The New York Times, a motive to falsely claim England is practicing austerity and suffered as a result of it (ludicrously, Krugman calls Obama a "small spender”). With government spending at around half the size of England's economy,

  • Immigration Restrictions Violate Americans' Liberty

    February 26, 2013 4:50 PM

    Immigration restrictions are more than just violations of the liberties of foreigners. Truly a society that restricts the freedom of certain groups restricts the freedom of all. Apologists for state action will reassure voters that each new intrusion into society will only impact the “one-percent” -- that is to say that restrictions on the liberty of marginal groups will leave yours unaffected. The message underlying each government intervention is that your freedom is safe, or even enhanced by another’s loss in liberty.

    Immigration restrictionists assure Americans that the sacrifice of the immigrant’s freedom of movement entails no limitation on the liberty of Americans. But liberty is not atomistic. The government cannot simply excise the liberty of one group and leave the freedom of all others unaffected. Just as free speech violations violate not just the rights of the speaker to speak, but also the right of listener to hear, so immigration limits injure not just foreigners who want to move, but also Americans who want to associate with them.

  • National ID, By Itself, Violates Liberty

    February 25, 2013 4:40 PM

    As I have pointed out over the past month and The Wall Street Journal’s Danny Yadron noted last week, many members of Congress are looking to impose a mandatory national identification system. Demonstrating that this attempt is gaining momentum, The Washington Post editorialized in favor of a national ID system earlier this month. Its editors wrote:

    Critics on both the civil-liberties left and the libertarian right have long resisted such cards as the embodiment of a Big Brother brand of government, omniscient, invasive and tentacular.  Their criticisms ring hollow…. The proliferation of passports for foreign travel has not encroached on Americans’ civil liberties. Why would another form of ID, used for employment verification, pose such a threat?

    Three things to notice about this line of reasoning: 1) It presupposes that a restriction of one’s ability to remain anonymous does not “encroach on Americans’ civil liberties”; 2) It cites without evidence that the government’s involvement in the regulation of travel has not violated (in other ways) Americans’ civil liberties; and 3) It assumes that this universal worker ID would remain limited to employment verification. Nothing could be clearer than that each of these arguments is totally false.

  • Why The Sequester Budget Cuts Are Good

    February 25, 2013 8:41 AM

    As we noted earlier, the automatic budget cuts contained in the sequester will help the economy in the long run, even if they are painful in the short term. This is partly because the budget cuts, by reducing America's trillion dollar budget deficits, will reduce the future economic burden of servicing America's skyrocketing national debt, a burden that will crowd out private investment.

    The Cato Institute describes why most of these cuts are a good thing on their own merits as well (and not just for the macroeconomic reasons we gave). For example:

  • Europe's Latest Wake-Up Call: Italian Elections

    February 25, 2013 6:00 AM

    Europe, which has been enjoying a recent respite from financial chaos, is about to get a rude awakening: Italian elections. Voters will go to the polls this Sunday through Monday, and the winner will soon upset the Eurocrat and financial calm that has surrounded Italy since Mario Monti’s caretaker government took office in November 2011. In the months following this weekend’s election results, financial markets will increasingly expect progress on reform of Europe’s third-largest economy. But Rome will be unwilling to deliver.

    That’s because the almost certain winner, a centre-left coalition led by the Democratic Party is resistant to the kinds of reform that Italy badly needs. There is some hope for change, however.

    Although Italy’s centre-left coalition is likely to win a majority in the House of Deputies (Italy’s lower parliamentary chamber), a clean victory in the Senate (the upper chamber) is much less probable. As a result, the centre-left group will probably coalesce with the centrist group backing former technocrat Prime Minister Monti. Despite his technocrat government’s lackluster record, Monti has at least attempted liberalizing reforms and budget consolidation. And he has set forth a new agenda pushing for more. In contrast, the Democratic Party wants to go in the opposite direction: adding more regulations to an already broken labor market and easing the drive for austerity begun under the Monti government. But a centre-left coalition that includes pro-Monti centrist parties will have to make concessions for liberal reforms and budget consolidation, or risk governmental collapse.

    There’s also the specter of the populist Five Star Movement threatening to compound parliamentary logjam. Although it seems highly unlikely that it will be part of any governing coalition, current polls place the movement at receiving roughly 15 percent of the general election vote. That translates into a smaller percentage of parliamentary seats because of a special “majority bonus” going to the proportional winner in this weekend’s elections, but the movement is loud and has an enthusiastic following. Unfortunately, its economic illiteracy is rampant—with radical propositions like banning stock options.


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