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OpenMarket: Subsidies and Bailouts

  • Bad Highway Policy Is a Bipartisan Affair

    February 28, 2014
    Two major pieces of surface transportation policy news dropped this week. President Obama is readying the release of his budget, which will contain over $300 billion in transportation funding. Across the aisle, Rep. David Camp, R-Mich., the powerful chairman of the House Committee on Ways and Means, released a sweeping proposal to overhaul the U.S. tax code, which includes a component that would direct $120 billion in tax savings into the Highway Trust Fund. The president's latest budget is far from surprising, as it differs very little from his previous surface transportation proposals. Of the combined highways and transit spending ($278 billion), he proposes to allocate 25 percent ($72 billion) to mass transit -- a mode that makes up about 5...
  • No Obamaloans at the Post Office!

    February 12, 2014
    While Sen. Elizabeth Warren may proudly brand herself a populist, in her latest crusade, she is casting her lot with fat cats. Warren wants to bestow banking privileges upon the United States Postal Service (USPS), an organization with executives living high on the hog even as, by Warren’s own admission, its “financial footing” is in doubt. The USPS pleaded poverty last month as it raised the price of a first-class stamp from 46 to 49 cents and promised that more rate increases are on the way. Yet in 2012, it managed to pay Postmaster General Patrick Donahoe $512,000 in total compensation, according to page 67 of the annual report filed by the Postal Regulatory Commission. And in 2008, then-Postmaster General John E. Potter received more than $800,000 in total compensation and retirement...
  • CEI Experts on the State of the Union

    January 28, 2014
    ECONOMIC MOBILITY Iain Murray, Vice President for Strategy: “The fact is: Today’s America is divided between those who work for government and those who don’t. Those who work for government have a job for life, guaranteed retirement and other benefits, and financial security,” said Murray. “Those who don’t, have uncertain prospects. They are at the mercy of an administration that is making their benefits more expensive and restricting their access to credit with more and more regulations. That is the true inequality in President Obama’s America.” Ryan Young, Fellow: “Given what reports suggest will appear in the president’s State of the Union address, we need to keep in mind three things. First: A higher minimum wage is not a free...
  • The Great Italian Auto Bailout -- Courtesy of U.S. Taxpayers

    January 1, 2014
    At the beginning of 2014, Detroit may be bankrupt, but they're cheering the five-year-old U.S. auto bailout in Italy. That's because after being the beneficiary of billions in U.S. taxpayer largesse, Fiat, the leading Italian auto company, is going to buy its final stake in Chrysler from that other big bailout recipient, the United Auto Workers (UAW). "Chrysler's Now Fully an Italian Auto Company," reads the Time magazine online headline. But wait a minute! Wasn't the bailout supposed to be about saving the American auto industry? As Mark Beatty and wrote in The Daily Caller in November 2012, after presidential candidate Mitt Romney made the controversial claim that Fiat would be expanding production of Chrysler's Jeep in...
  • The Volcker Winter Storm -- Bad Rule, Worse Implementation

    December 11, 2013
    On a snowy day in Washington, several federal agencies packed some mean regulatory snowballs that will most likely overshoot their supposed destination of Wall Street and crash-land with a thud on the businesses and investors of Main Street. Rather than postpone the planned vote on Tuesday, when the federal government was officially closed, agencies sheltered themselves from public view and pushed through the rules. According to USA Today, "CFTC spokesman Steven Adamske said his agency will not hold a public meeting, but commissioners will approve the rules in writing." This lack of transparency on voting on the rule was symptomatic of a series of last-minute changes from the rule the agencies had initially proposed two years ago. The agencies never submitted...
  • Volcker Rule Curbs Useful, Profitable Proprietary Trading, Not Risky Lending

    December 11, 2013
    The government just approved a regulation called the Volcker Rule to curb proprietary trading by banks -- even though such trading did not cause the financial crisis, or lead to massive financial losses by banks and taxpayers the way other, much riskier practices by banks did (like risky mortgage loans, which the Obama administration has...
  • Mel Watt Fails Taxpayer, Privacy, and Transparency Tests

    October 31, 2013
    Former Rep. Mel Watt, D-N.C., failed his procedural confirmation vote today to head the Federal Housing Finance Agency, which oversees the government housing entities Fannie Mae and Freddie Mac. His defeat -- so far -- is a victory not just for fiscal integrity, but for privacy and transparency as well. As a congressman, Watt egged on the reckless policies of Fannie Mae and Freddie Mac that got us into the mortgage crisis from which the economy is still recovering. But just as bad, he was on the wrong side of both liberals and conservative reformers on two crucial issues. Watt was a co-sponsor and vocal supporter of the Stop Online Piracy Act (SOPA), which collapsed in 2012 after a transpartisan coalition made the public aware of its threat to privacy and innovation. And...
  • Public Pensions Are Not Property

    October 21, 2013
    Across the nation, state and local governments in dire financial straits face great difficulty in their efforts to bring their budgets under control. Pensions are one of the biggest drivers of deficits, and therein lies the problem. Many states treat pensions not as a form of compensation, but as a contractual obligation to the employee. As a result, states and cities that have tried to bring pension obligations under control have seen roadblock thrown up in court by government employee unions. As the Manhattan Institute's Steven Malanga explains:
    In the private sector, pensions are governed by the federal Employee Retirement Income Security Act. Although a private employer may not cut benefits that a worker has already earned, ERISA allows a business to change the rate...
  • J.P. Morgan Settlement Rips Off Taxpayers and Investors, Punishes Some Alleged Victims

    October 21, 2013
    Recently, The Washington Post reported that J.P.Morgan will pay $13 billion to settle lawsuits against it by the federal government and two state attorneys general. Judging from the story, the proposed settlement contains provisions that rip off taxpayers and punish the very investors victimized by the misconduct alleged. This is depressing, but perhaps not surprising from an administration that has used past mortgage settlements to rip off innocent mortgage investors, and enrich...
  • Shut Down Fannie and Freddie Permanently

    October 11, 2013
    Cross-posted from Newsbusters.org “U.S. Government Shutdown Threatening Housing Recovery,” screams the Oct. 2 headline of a shutdown scare screed in Bloomberg BusinessWeek. Wade into the story, however, and we see that what’s really at hand is a mere delay of processing of mortgages because of some employees furloughed at the Federal Housing Administration. Furthermore, as the article explains, the government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac will remain completely open because ” the government-controlled mortgage aggregators fund operations through fees collected from private lenders”...

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