CEI Today: Santa capitalism, Volcker rule, nuclear power safety
SANTA CAPITALISM - IAIN MURRAY
We should call it the “Great Fact,” argues University of Illinois at Chicago economist Deidre McCloskey. “It” is the Industrial Revolution that, starting in Great Britain in the late 18th century, produced a 16-fold expansion in per capital wealth throughout the world. With that explosion in wealth came longer life spans, better health care, and the greatest improvement in human welfare the world has yet seen.
This explosion was not caused by government plans or at the behest of church leaders. It was the result of a force that has since become derided by those who claim to care about progress — free enterprise capitalism. In this festive season, we should reflect on its great gifts to mankind.
VOLCKER RULE - JOHN BERLAU
Even as written in the Dodd-Frank financial “reform” statute, the Volcker Rule was a solution in search of a problem, or in search of a factor that was not even a minor cause of the financial crisis. The provision, often referred to a “Glass-Steagall lite” – after the 1930s law that was repealed by President Clinton in 1999 – maintains Glass-Steagall’s false dichotomy of inherently “risky” trading vs. inherently “safe” lending.
And it doesn’t ban or restrict trading based on level of risk, but on whether the trading is ”proprietary.” Most discouragingly, in the statute and in last week’s edict, the Volcker Rule contains explicit exemptions for trading in risky government-backed securities, such as municipal bonds and foreign sovereign debt.
NUCLEAR POWER SAFETY - WILLIAM YEATMAN
Regardless the ongoing environmental impacts of the Fukushima Daiichi nuclear event in March 2011, which no doubt remain significant, the forced evacuation of more than a hundred thousand people in the region proximate to the power plant was an unmitigated disaster. As reported by the Wall Street Journal, there are a possible 194 excess cancers among the Fukushima population, while 1,600 persons died from the forced evacuation. That’s a terrible cost benefit ratio.