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OpenMarket: July 2015

  • Dodd-Frank’s Dire Legacy: The Durbin Amendment

    July 21, 2015

    Today is the fifth anniversary of the passage of the Wall Street Reform and Consumer Protection Act, better known as Dodd-Frank. As the Mercatus Center revealed this week, it may be the biggest law ever written, because it gives the administration so much discretionary power to make secondary law. It has harmed consumers by reducing choice in financial services and failed to solve the problems it was purported to solve, as I outline in my new paper, How Dodd Frank Harms Main Street. One of the worst examples of this stems from the Durbin Amendment, a last minute addition to the bill that gives the Federal Reserve the power to cap interchange fees  charged by debit and credit card networks...

  • Happy “No Food is Junk Food” Day!

    July 21, 2015

    Yes, there’s a holiday for everything, but National Junk Food Day has particular relevance in light of a recent decision by the Food and Drug Administration. As the Cato Institute pointed out, the foods we indulge in today may be very different when we celebrate next year. That is because the FDA decided to create a de facto ban on partially hydrogenated vegetable oils (aka artificial trans fats). While most food producers eliminated the much maligned additive in the last 15 years and Americans have reduced consumption from 4.6 grams per day in 2003 to less than a gram in 2013, some products still contain trans fats—most of which are sweets that require long shelf-life. Despite a dearth of research on the effect of consuming trans fats at the low levels Americans do, the FDA asserted...

  • Reports of Capitalism’s Demise Have Been Greatly Exaggerated

    July 20, 2015

    British journalist Paul Mason has famously declared that capitalism is dying, and he is in no sniffling state of mourning about it. In advance promotion for the publication of his forthcoming book, Postcapitalism, he was penned a nearly 5,000-word article for the Guardian that covers quite a bit of anti-capitalist/leftist/techno-utopian theory. There’s a lot to respond to in this piece (not to mention the full 368 pages of his book), but one assumption in particular strikes...

  • Not Dodd-Frank, Not Glass-Steagall, But Real Competition to End TBTF

    July 20, 2015

    Progressives cheered Hillary Clinton last week when she said policy makers need to “go beyond Dodd-Frank.” She didn’t rule out repeal of some sections, but most took it to mean preserve virtually all of the law—which turns five on July 21—plus expand government intervention further into banking.

    But that praise was short-lived when Clinton’s economic adviser Alan Blinder told Reuters, “You’re not going to see Glass-Steagall” reinstated in her administration. The New Deal-era Glass-Steagall Act separated commercial and investment banking until it was partially repealed by the Gramm-Leach Bliley Act, which passed Congress overwhelmingly in 1999 and was...

  • HUD's "Affirmatively Furthering Fair Housing" Rule Is about Social Engineering, Not Desegregation

    July 20, 2015

    Failure to meet a racial quota is not the same thing as segregation. That basic fact has eluded the federal Department of Housing and Urban Development, which recently adopted a rule called “Affirmatively Furthering Fair Housing” that seeks to alter the racial makeup of America’s cities and towns even when there is no justifiable reason to do so.

    This recently issued Fair Housing Act rule wrongly defines “segregation” as a “high concentration of persons of a particular race” or “religion.” (See 78 Fed. Reg. 43709, 43730.)

    But mere “concentration” is not segregation. For example, Orthodox Jews are concentrated in certain...

  • CEI's Battered Business Bureau: The Week in Regulation

    July 20, 2015

    It was a busy week for the Federal Register, which included a 629-page proposed regulation from the EPA for greenhouse gas emissions and fuel economy for cars and trucks, as well as final regulations covering everything from finishing wood to inspecting tunnels.

    On to the data:

    • Last week, 78 new final regulations were published in the Federal Register, after 56 the previous week.
    • That’s the equivalent of a new regulation every two hours and nine minutes.
    • So far in 2015, 1,736 final regulations have been published in the Federal Register. At that pace, there will be a total of 3,168 new regulations this year, which would be several hundred fewer rules than the usual total of 3,500-plus.
    • Last week, 2,764 new pages were added to the Federal Register, after 1,647 pages the previous week.
    • ...
  • EEOC Legislates New Federal Ban on Discrimination Based on Sexual Orientation

    July 17, 2015

    When Congress declines to pass a law that would expand an agency’s powers, the agency will sometimes respond by making up the law on its own. The Equal Employment Opportunity Commission recently did this, by adding a new protected class to federal employment laws, at the expense of America’s employers.

    Congress has never enacted a ban on private-sector sexual orientation discrimination, so the subject is governed largely by state or local law (most, but far from all, of America’s workplaces are covered by a state...

  • The Persistent Truth of Income Mobility

    July 17, 2015

    There’s a lot being written these days about income (and wealth) inequality, and how a free market economy allegedly exacerbates the divide between the rich and the poor. Statistical measures of inequality look at income groups in the aggregate, though—they don’t tell us which people are in those low and high income groups, or how the composition of those groups change over time. As the George Mason University’s Tyler Cowen wrote in The New York Times earlier this year:

    Income inequality and...

  • After 80 Years, Labor Law Needs Reform

    July 17, 2015
    Senator Patty Murray (D-Wash.) recently penned an op-ed that celebrates the 80th anniversary of the National Labor Relations Act and praises the work of the National Labor Relations Board, which is charged with enforcing the Act. In same piece, she sharply criticizes attempts to reform the Act and Board.
  • Slate Exposes Deceitful Heart of the Anti-GMO Movement

    July 17, 2015

    Will Saletan has an exhaustively researched and cogently argued piece at Slate on the dishonesty of the anti-biotechnology activists and the harm they have caused. He lays out, for all to see, the naked truth about their efforts. It has nothing to do with the truth. They only care about pushing their agenda, even if it comes at the cost of human lives. As Saletan writes, “[t]hey want more studies. They’ll always want more studies. They call themselves skeptics. But when you cling to an unsubstantiated belief, even after two decades of research and experience, that’s not skepticism. It’s dogma.”

    Saletan describes the tactics employed by activists to hoodwink the public and politicians. Fear-mongering...

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