Free Markets, Free People

Daily Archives: April 27, 2010

Open Borders

Over the past few days, I’ve been watching with interest on Twitter as Doug Mataconis and Jason Pye have been moaning about the new immigration law in Arizona. Now, I grant it’s a bad law from a civil liberties perspective. I’ve seen to much of policing from the inside to trust police not to run a truck through any ambiguities that they find in the law.

But some of the links they’ve posted seem a bit overdone. For instance, one of them linked to an article that implied that there’s a white supremacist behind the movement to pass the law. But what really caught my eye was a link to an article that gave all the standard libertarian reasons for having open immigration.

There was only one thing wrong with the article. It made all sorts of arguments about natural rights and economics, but nowhere did it address national security.

So, I guess my question is this: If you are going to argue for opening the borders, how will you go about doing so in a world of hostile nation-states, whose citizens may wish to do us harm? Clearly, the framers gave some thought to the issue, as they gave Congress plenary power to regulate immigration.

So, even granting that the rights-based and economic arguments are correct, which, mainly, I do, I still would like to know how you would address the security implications of open borders in a hostile world.

Surely, our agreement on the general principles of liberty don’t require us to commit seppuku by allowing hostile foreign powers to take advantage of them, do they?

The ObamaCare fallout continues

You remember when AT&T and other companies immediately took write downs against profit soon after the ObamaCare legislation was signed into law?

Henry Waxman and Bart Stupak reacted immediately calling for a Congressional hearing so the CEOs of some of these companies could be called on the carpet for trying to show up this fabulous law.  Waxman whined that wasn’t its intent.  And then, mysteriously, a week or so later, they quietly canceled the hearings.

In a memorandum summarizing its investigation, the Democratic staff of the committee said, “The companies acted properly and in accordance with accounting standards in submitting filings to the S.E.C. in March and April.”

Moreover, it said, “these one-time charges were required by applicable accounting rules.” The committee staff said this view was confirmed by independent experts at the Financial Accounting Standards Board and the American Academy of Actuaries.

Oops.  Waxman and Stupak tried to recover a little by  saying:

“Companies like AT&T, Verizon and a range of stakeholder associations are hopeful that the benefits of the new law will outweigh the costs,” Mr. Waxman and Mr. Stupak said in a memorandum to committee members. “But they cannot quantify the benefits until the law is implemented.”

Well, apparently they’ve found some more of those “benefits” in the law:

AT&T, which took a $995 million charge to reflect the impact of the health care overhaul, said it would be “evaluating prospective changes to the active and retiree health care benefits offered by the company.”

Under another provision, employers may be subject to financial penalties if they do not offer health insurance to employees. Documents provided to Congress by AT&T indicate that its medical costs in 2009 were $4.7 billion, divided about equally between active employees and retirees — far more than it would pay in penalties if it did not provide coverage.

Verizon said it was taking a $970 million charge against earnings because of the change in tax treatment of a subsidy it receives for retiree drug coverage. In addition, Verizon said it could be affected by a new tax on high-cost health plans that takes effect in 2018.

“Many of the plans that Verizon offers to employees and retirees are projected to have costs above the thresholds in the legislation and will be subject to the 40 percent excise tax,” the company told employees.

So obviously, in the case of AT&T (and many other companies) they’re going to be called into Congressional hearings for breaking Obama’s “if you like your doctor and you like your plan, you can keep it” promise, right?  I mean, those are the “benefits” the employees of AT&T and Verizon seem likely to “enjoy” when the law is implemented.

In a general analysis of the new law, Verizon said, “To avoid additional costs and regulations, employers may consider exiting the employer health market and send employees” to state-run insurance exchanges, where people can buy insurance.

A Caterpillar executive made a similar point in an e-mail message to colleagues, saying the tax changes could “drive many employers to just drop coverage for retirees altogether, and let the government foot the whole bill.”

I’d like to write this off to the law of unintended consequences, but that would be pure nonsense.  Not only was this known as a probable outcome, but Democrats lied through their teeth when they denied it. It was and is completely intended. It is the companies, however, that will be demonized for doing precisely what Democrats hoped they’d do (or, one assumes, the penalty for not supplying health care would have been much higher and any tax on Cadillac plans much lower).  Single payer, here we come.

And you wonder why they kept it hidden so no one could read it until after it passed?



No Happy Meal for you!

The Nanny State never rests.  In Santa Clara county, California (surprise, surprise) county supervisors are proposing a ban on toys in fast food meals:

Convinced that Happy Meals and other food promotions aimed at children could make kids fat as well as happy, county officials in Silicon Valley are poised to outlaw the little toys that often come with high-calorie offerings.

The proposed ban is the latest in a growing string of efforts to change the types of foods aimed at youngsters and the way they are cooked and sold. Across the nation, cities, states and school boards have taken aim at excessive sugar, salt and certain types of fats.

Believed to be the first of its kind in the nation, the proposal would forbid the inclusion of a toy in any restaurant meal that has more than 485 calories, more than 600 mg of salt or high amounts of sugar or fat. In the case of McDonald’s, the limits would include all of the chain’s Happy Meals — even those that include apple sticks instead of French fries.

Because Nanny knows best, one size fits all,  and besides you parents out there are just incompetent.

Supporters say the ban would encourage restaurants to offer more-nutritious foods to kids and would make unhealthful items less appealing. But opponents believe it amounts to government meddling in parental decisions. The Santa Clara County Board of Supervisors will consider the proposal Tuesday.

Anyone – do you really believe that taking a toy out of a meal will make the meal “less appealing”, or do you suppose the taste of the meal has more to do with the appeal and the toy is just a bonus.  Or ask another way, if you take the kids to McD’s and toys are no longer available, will they order or want something other than what is normally found in a Happy Meal.

My four grandson survey says “no”.  But the nanny’s will not be denied:

Ken Yeager, the Santa Clara County supervisor who is behind the effort, says the toys in kids’ meals are contributing to America’s obesity epidemic by encouraging children to eat unhealthful, fattening foods.

“People ask why I want to take toys out of the hands of children,” said Yeager, who is president of the Santa Clara County Board of Supervisors. “But we now know that 70% of the kids that are overweight or obese will be overweight or obese as adults. Why would we want to burden anybody with a lifetime of chronic illness?”

Who is “we” Mr. Yeager and by what right do you reach down into a retail establishment and decide what it can or can’t offer to its customers? Just as importantly, since when is it the role of government to decide what is or isn’t appropriate for someone to eat?

This is just the beginning of what you can expect to see from the food nazis (the FDA and salt?) now that government health care reform is law.



Does the Jones joke suggest an attitude?

I’m sure you’ve head about the joke National Security Adviser James Jones told at a recent speech to the Washington Institute For Near East Policy. If not, here it is:

I’d like to begin with a story that I think is true, a Taliban militant gets lost and is wandering around the desert looking for water. He finally arrives at a store run by a Jew and asks for water. The Jewish vendor tells him he doesn’t have any water but can gladly sell him a tie. The Taliban, the jokes goes on, begins to curse and yell at the Jewish storeowner. The Jew, unmoved, offers the rude militant an idea: Beyond the hill, there is a restaurant; they can sell you water. The Taliban keeps cursing and finally leaves toward the hill. An hour later he’s back at the tie store. He walks in and tells the merchant: “Your brother tells me I need a tie to get into the restaurant.”

Jones went on to deliver his speech. But the damage was done. He’s been called everything but a child of God since. Many believe the joke to be anti-semetic.

It certainly plays to a stereotype, doesn’t it? And at a minimum, it was inappropriate.

But Jones obviously thought nothing of telling the joke. And I was rather surprised by his suggestion that he believes the “story” to be “true”. Wiggle out of that one if you can.

So why did Jones feel comfortable in delivering a joke that was obviously of questionable taste and certainly inappropriate for the occasion? Did he actually believe it to be appropriate? Did he not think anyone would take offense? And if so, why?

Those questions get to the heart of my point. There are few rational people who have followed this administration’s dealings with Israel over the last year who would quibble with the word “disrespectful” as a description of how it has dealt with that country. Never, to my knowledge, have the Israelis been treated so badly by the US during their entire existence as a state (and Israel and I share a birth year). The recent diplomatic dust up in which a fairly routine announcement about housing in Jewish east Jerusalem was turned into a crisis by the US, not Israel. Subsequent treatment of the country and its leaders has been just a shabby. So shabby, in fact, that the only bipartisan thing to come out of Congress in a while is a condemnation of the administration’s treatment of Israel.

To me, that suggests an attitude. Jones joke suggest a pervasive attitude. The fact that the White House didn’t demand an apology from Jones only adds to the strength of that suggestion. Frankly it’s an attitude we can ill afford and certainly one that isn’t going to advance any peace process in the region.

On April 20th, apparently recognizing that the administrations treatment of Israel was causing problems within the US Jewish community, President Obama sent a letter to Alan P. Solow, Chairman of the Conference of Presidents of Major American Jewish Organizations in an effort to calm the storm that was brewing. In the letter he spoke of the “special relationship” the US has with Israel and promised it would not change. But he also said:

Since we have known each other for a long time, I am sure you can distinguish between the noise and distortion about my views that have appeared recently, and the actual approach of my Administration toward the Middle East.

Typical Obama doublespeak. The actions of his administration are what brought on the concern. It wasn’t “noise and distortion”, it was the words of administration spokespersons and Obama himself that caused consternation among supporters of Israel.

And now, after the letter, we have the Jones issue with no White House disclaimer (remember, this is a WH that felt it necessary to speak about the arrest of a person in DC and condemnation of the police – leading to the infamous “beer summit”).

To me, that points to an attitude – an unproductive attitude – that permeates the administration and clouds its ability to pursue meaningful peace in the Middle East.



Stimulus had no impact

That’s according to a survey of the members of the National Association for Business Economics (NABE):

NABE conducted the study by polling 68 of its members who work in economic roles at private-sector firms. About 73% of those surveyed said employment at their company is neither higher nor lower as a result of the $787 billion Recovery Act, which the White House’s Council of Economic Advisers says is on track to create or save 3.5 million jobs by the end of the year.

That sentiment is shared for the recently passed $17.7 billion jobs bill that calls for tax breaks for businesses that hire and additional infrastructure spending. More than two-thirds of those polled believe the measure won’t affect payrolls, while 30% expect it to boost hiring “moderately.”

The point, of course, is these are the people who would have seen any such positive impact within the market created by both the stimulus and the “jobs” bill.  Almost 3/4s saw no effect whatsoever.  That’s because the stimulus, among other things, was ill conceived, ill timed (if you’re going to do it, you don’t pay “stimulus” out over several years) and despite what President Obama said, almost 100% pure pork.

So apparently, as the recovery begins, it will be under its own steam and without the impact of any government “stimulus” spending.



Editor and Publisher: “Sky isn’t falling as fast as you might think; ignore chunks coming through ceiling around you”

The newspaper industry loves dramatic headlines. At least, until they’re looking at their own problems. Then it’s time to look for a silver lining, even if it’s a pretty tarnished one. So here’s the headline for the Editor and Publisher article that tells us that circulation for newspapers, which fell 10.6% last year, fell again this year by 8.6%:

Like Newspaper Revenue, Decline in Circ Shows Signs of Slowing

I guess the good news is that instead of plunging to oblivion immediately, they’re merely on a rapid glide path towards it, with no noticable prospect of reversing course. For any other industry or trend (e.g. global warming), I’m guessing we would see somewhat more dramatic headlines.

Newspapers are high-volume businesses. As a whole lot of newspapers in medium-to-large cities discovered in the last twenty years, it isn’t necessary to lose all, or even most, of your subscribers to become non-viable as a business. A certain reasonably sized subscriber base is required to sustain a large staff, a huge printing press facility, and a distribution network.

So how much more loss on top of the 20% in the last two years will it take for the major to start imploding? I don’t know, but it’s hard to see how they can tolerate more than four or five more years of that type of decline with anything like their current business model.

But they’re determined to find good news:

And newspapers — including some that reported big declines in print paid circ — showed significant growth when print and online audiences are combined.

OK, but for any major newspaper that doesn’t have “Wall Street” in its name, there’s no direct revenue from online “circulation”, and any advertising money from an on-line presence is a small fraction of the advertising revenue in print publication. Nobody except Google has figured out a way to turn online content into significant revenue, and it seems pretty unlikely that stodgy newspapers will be the ones to do it.

For those just tuning in, the basics for these guys are absolutely horrible. Traditionally, the biggest chunks of their print advertising revenue include:

– Classifieds

– Movie listings

– Automotive dealership ads

– Retail chain ads

Now lets take these one at a time. Classifieds have almost been destroyed by Craigslist. Teenagers would no more think of buying a newspaper to check movie listings than they would consider buying a leisure suit. Car sales are down, we don’t know when they’re coming back, and that entire industry is going through a re-structuring. Retail is in turmoil, as shown by the vaporization of Circuit City, Linens and Things, Media Play, S&K Menswear, and others.

It looks unlikely that any one of these four will get significantly better as revenue sources for newspapers. The top two are gone for good. I suppose the last two might stabilize if the economy improves, though I certainly would bet on merely slower declines instead of increases.

Newspapers also have the same problem as broadcast news programs: an aging customer base. Young people are shifting their reading habits away from print publications in general and newspapers in particular. This has been going on a while, and in the absence of all other factors presages a decline to irrelevance for print pubs.

That doesn’t even touch on the ongoing drop in quality and increase in bias many of us see in newspapers. I used to occasionally actually put money in a rack for USA Today. No more. I see it in hotels a few times a year, and it’s just awful. I’m considering stopping reading it even when it’s free because it’s just a waste of time.

It’s interesting, in fact, to note that the only major newspaper with a small increase in circulation was the Wall Street Journal. I don’t consider the WSJ to have gold-plated quality, but they at least try to do some in-depth work and not be totally blinded by their biases.

As a counterpoint, the very liberal San Francisco Chronicle has the largest percentage drop among the majors, down 22.68% in one year! Another year or two like this, and San Francisco will be left with no significant daily newspaper. That is, unless the Chronicle just does the same thing as the other majors in the Bay area and combines with the San Jose Mercury News:

There was a new kid in the top 10 as the San Jose Mercury News posted a weekday circulation of 516,701 by incorporating the Oakland Tribune and Contra Costa Times as editions of the Mercury News.

Our liberal friends often tell us we’ll miss these institutions when they’re gone, but as with climate alarmists and their huge houses, they don’t back up what they say with their own actions.

For those of us who love to beat up the majors for incompetence and biased reporting, take note: indulge while you can. With numbers like these, who knows how long it will last.