February 4, 2016
Cronyism and boondoggles in an energy bill is nothing new in the U.S. Congress. But this week, senators of both parties are taking the process to new lows in amendments they are offering to the pending S.2012—the Energy Policy Modernization Act.
Not only are these politicos picking winners and losers through subsidies and mandates favoring selected “green” industries and technologies, they are roping in housing and finance agencies into their “environmentally correct” schemes. At best, this would divert the agencies away from their missions at a time of great economic volatility. At worst, it could cause a financial crisis of its own.
First, there is an amendment from Sen Johnny Isakson (R-Ga.), a former real estate agent, which would loosen credit standards for “green” homes...
January 11, 2016
On Tuesday evening, President Obama will give his final State of the Union address. In evaluating the state of the U.S., it’s useful to look at the state of economic freedom, including the ability for ordinary Americans to start and invest in a new business without undue government interference.
By several measures, economic freedom has declined rapidly since 2009. Though some harmful policies were enacted in during the Bush administration, such as the Sarbanes-Oxley accounting mandates that made it so much more difficult smaller companies to go public, the Obama administration has not reversed those policies and pushed through many new detriments to economic freedom. These include Obamacare, which makes it difficult for small and midsize firm to hire new employees to due to the expensive and prescriptive insurance coverage mandates, and the Dodd-Frank “financial reform,”...
December 29, 2015
As 2015 comes to a close, it’s time for year-end retrospectives, in which the past year is proclaimed the “year of” something. So in that spirit, I declare 2015 to be the Year of Equity Crowdfunding. Some proclaimed 2012 the “Year of Crowdfunding. But 2015 has been the year that regulatory barriers to equity crowdfunding slowly but surely began to fall at the state and federal level.
As I explain in my rcent paper, “Declaration of Crowdfunding Independence,” significant regulatory roadblocks – including laws more than 80 years old – have stopped entrepreneurs...
December 16, 2015
My Competitive Enterprise Institute colleagues and I have made the case for members of Congress to use the omnibus spending bill as an exercise of its “power of the purse” to hold the Obama administration accountable. Unfortunately, negotiators in Congressional leadership opened that purse way too soon and way too wide to give President Obama nearly everything in terms of the spending he wanted while inexplicably leaving out regulatory relief measures that members of both parties were clamoring for in the thousand-plus page omnibus bill (read it here) to be voted on later this week.
While there were a couple good measures like lifting the oil export ban and repealing the expensive and...
December 15, 2015
As the year-end omnibus spending bill is about to be unveiled, there will be a scramble to examine its provisions. In many policy areas, my colleagues and I have urged Congress to use its “power of the purse” to insist on significant regulatory relief as a price for the new spending in the omnibus.
I have written that Congress should freeze funding for the Department of Labor’s (DOL) “fiduciary rule,” referred to by many as “Obamacare for your IRA,” which would greatly limit investment choices in IRAs and 401(k)s and even restrict what financial broadcasters like Dave Ramsey could say to listeners.
Defunding of this rule was also urged by a ...
November 30, 2015
It is indeed sad that 40 percent of millennials favor the government banning speech that some deem offensive, according to a recent Pew poll. Even more distressing is that college students have plenty of company with members of other age groups and professions who want to shut down speech they disagree with.
Take speech about personal finance. This is an area where there would certainly seem to be room for a diversity of opinion, given the complexity of the topic and differences in individual financial goals and circumstances. That’s why there is no shortage of books and radio and television shows with differing viewpoints about financial planning. If you don’t subscribe to what Suze Orman or others have to say, you can always read or tune in ...
November 12, 2015
The behemoth Consumer Financial Protection Bureau (CFPB) played a big role in Tuesday night’s GOP presidential debate on Fox Business, both during the commercials and in the candidate’s answers.
A new ad by American Action Network that made its debut during commercial break correctly linked the CFPB—created by the Dodd-Frank so-called financial reform act rammed through Congress in 2010—to denial of mortgages and car loans due to the CFPB’s costly and paternalistic rules that hit Main Street bank and credit unions. The candidates critical of Dodd-Frank dinged those same policies, but often without naming the CFPB.
Carly Fiorina called out the CFPB directly and for another disturbing policy. She pointed out that...
November 4, 2015
I wish baseball great Yogi Berra were still here—upon the release of Freddie Mac’s new quarterly report showing a sudden Q3 loss—so he could offer his famous Yogism “it’s déjà vu all over again.” After seemingly smooth sailing under which Freddie and its sister Fannie Mae turned profits over the last couple years, this net loss of $475 million raises the specter of yet another government bailout.
Fannie Mae and Freddie Mac, the two government-sponsored enterprises (GSEs) that many observers—from American Enterprise Institute scholar Peter Wallison to New York Times business...
October 30, 2015
More than three years after the JOBS Act was signed into law by President Obama, the Securities and Exchange Commission (SEC) today will finally vote to approve equity crowdfunding rules. The final rule implementing Title III of the Jumpstart Our Business Startup (JOBS) Act of 2012, though late in coming, represent a first step for policymakers in getting public policy in step with America’s crowdfunding heritage.
When a small firm grows by giving a community of funders a share in the profits—rather than just token items such as t-shirts—that’s known as equity crowdfunding. And it’s an idea whose time has come, because it is an idea that has always been here. Henry Ford, as I have written in a paper for CEI, crowdfunded among his friends and neighbors 100...
October 27, 2015
I’m here on the Las Vegas Strip at Money20/20, a trade show and forum in the area of FinTech—a term used to describe a cross-section of alternative lending, cryptocurrencies, and new payment technology—that is a pretty big shindig. At around 10,000 attendees, Money20/20 is fast becoming the Consumer Electronics Show (CES) of FinTech. Or as the show’s boosters might say, CEA is becoming the Money20/20 of tech.
Anyways, some big news breaking here, such as JPMorgan Chase’s announcement of a mobile payments system to rival Apple Pay, and MasterCard’s “internet of things” initiative to enable mobile payments through keys,...