February 10, 2011
Reading through the headlines, the top economic stories are about scrutiny of regulation and spending proposals regarding the federal budget. But the similarities and differences in this scrutiny are striking.
In proposing spending cuts, the House Republicans are targeting wasteful and destructive spending in entities such as the Environmental Protection Agency. Similarly, a...
February 7, 2011At 11:30, in a much-anticipated speech at the U.S. Chamber of Commerce, President Obama used Super Bowl analogies to urge American businesses to "get off the sidelines," "get in the game," and "invest in America." But some two hours later, an action by Federal Deposit Insurance Corporation proposing to slash bonuses at financial firms illustrated why so many private-sector players are reluctant to enter a "game" in which the referees change so many of the rules at mid-quarter.
The proposed rules issued by the FDIC would require banks, brokerages, and other financial firms to defer 50 percent of executives' bonuses for three years. The FDIC, in coordination with other agencies, was given the...
February 3, 2011Although the U.S. Senate voted along partisan lines to defeat repeal of the Patient Protection and Affordable Care Act -- also known as Obamacare -- it overwhelmingly voted to repeal one of the provisions that has prove most burdensome to entrepreneurs: the mandate for business to file IRS 1099 reports on any purchase over $600.
The House should follow suit, and President Obama should be true to his new-found dislike of the provision expressed in the State of the Union and sign the repeal into law. Then, while the law's constitutionality is before the courts, Congress should continue pruning the branches that have proved to be the most burdensome to doctors, entrepreneurs, consumers, and savers and investors.
The next "branch" that should be up for...
February 2, 2011Monday's decision by Florida federal judge Roger Vinson striking down the Patient Protection and Affordable Care Act -- also known as Obamacare -- in its entirety was a huge and welcome victory for constitutional liberties. As CEI's Hans Bader, who along with CEI General Counsel Sam Kazman filed an amicus brief in the case on behalf of the governors of Minnesota and Rhode Island, wrote on the ruling, "Judge Vinson rightly declared the health care law’s individual mandate unconstitutional, since the inactivity of not buying health insurance is not an 'economic activity,'" and "...
January 18, 2011On Tuesday, the Financial Stability Oversight Council may issue its recommendations for implementing the Volcker Rule, the provision of the Dodd-Frank financial legislation that bans so-called proprietary trading by banks.
Initial reports indicate that the council may try to assuage some concerns about the rule's economic effects by attempting to draw a line between long-term investing from short-term trading. Congress, however, should still repeal this senseless rule that is already showing signs of doing lasting damage to the economy and which will most likely add, not lessen, systemic risk.
The Volcker rule is based on the faulty premise that a financial institution making a loan -- any loan -- is somehow inherently more dangerous than investing or...
New Year's Musings: My WSJ Arts Piece on "Cry Me a River" and More on Debit Card Interchange Price ControlsDecember 30, 2010For those of you on the East Coast and in parts of Europe, I hope you weren't too inconvenienced by the winter weather. We in D.C. were lucky that after we were warned about an eight-inch blizzard (still nothing compared to the two feet we had early this year that paralyzed the city for a week), we got off with a light dusting.
In what should my last blog post this year (though I could always have one tomorrow -- ha ha!), I wanted to share with you a piece I had a couple weeks ago in The Wall Street Journal, but this time on the Leisure & Arts page on the journey of a fairly common expression and the song that gave it birth.
Interchange Price Controls: Gift to Big Merchants, Lump of Coal for Consumers and Community Financial InstitutionsDecember 15, 2010On Thursday, the Federal Reserve -- at the direction of Congress in the Durbin Amendment to the Dodd-Frank financial "reform" bill -- will give a giant gift to some of the nation's biggest retailers. This present is in the form of of direct and indirect price controls on the interchange fees they pay to financial institutions to process debit cards payments
Yet unless Congress acts to delay or repeal the Durbin Amendment, consumers, community banks, and credit unions will be getting a large lump of coal in their stockings by next December as the expenses of running an efficient payment card system are shifted almost entirely onto their shoulders. Consumers have already seen the costs of this rule through the loss of free checking as a result of banks' anticipation of an estimated 60 to 80 percent...
December 7, 2010Over at Cato@Liberty, David Boaz points to a post by Chris Cardiff on RootedinProsperity.com praising a song and video of country superstar Brad Paisley. Cardiff praises Paisley's hit song "Welcome to the Future" for promoting "technology-driven product innovation" and linking it to the more "profound theme of social change."
With a couple caveats, which I will get to in a minute, I share this praise. And Paisley has had clever songs before. CEI President Fred Smith and I are both fans of another of his hits, "Alcohol," in which Paisley interestingly narrates from the perspective of the...
November 23, 2010This post was coauthored by CEI Research Associate Andrew Kwiatkowski
As we write, President Obama and Vice President Biden are doing a victory lap around a Chrysler plant in Kokomo, Indiana, in the wake of last week's successful initial public offering of General Motors. They will likely rattle off a litany of positive statistics that they and an adoring audience will attempt to attribute to the $82 billion bailout of Chrysler and GM.
But the figures the president has cited, and will likely...
November 17, 2010In his 1953 confirmation hearing for Secretary of Defense in the incoming Eisenhower administration, former General Motors CEO Charles "Engine Charlie" Wilson was asked how he would handle conflicts of interests in the Defense Department's dealings with his old firm. Wilson replied that "for years I thought that what was good for our country was good for General Motors, and vice versa."
For decades, Wilson's comment -- misquoted as "What's good for General Motors is good for the country" -- has been paraded by liberals as an example of conservatives putting the concerns of a giant corporation ahead of those of the rest of America.
But since GM's multi-billion dollar bailout and government takeover, the misquote from Wilson has become the philosophy of the Obama administration. They are treating the success...