Free Markets, Free People

Monthly Archives: November 2012

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But remember, government knows best …

And if you need an example of why you should always rely on government to get it right, well, just consider the latest concerning the mandated use of food ethanol for fuel:

The AAA says the Environmental Protection Agency and gasoline retailers should halt the sale of E15, a new ethanol blend that could damage millions of vehicles and void car warranties.

AAA, which issued its warning today, says just 12 million of more than 240 million cars, trucks and SUVs now in use have manufacturers’ approval for E15. Flex-fuel vehicles, 2012 and newer General Motors vehicles, 2013 Fords and 2001 and later model Porsches are the exceptions, according to AAA, the nation’s largest motorist group, with 53.5 million members.

“It is clear that millions of Americans are unfamiliar with E15, which means there is a strong possibility that many may improperly fill up using this gasoline and damage their vehicle,” AAA President and CEO Robert Darbelnet tells USA TODAY. “Bringing E15 to the market without adequate safeguards does not responsibly meet the needs of consumers.”

Ya think?

Hey look buddy,  the ideological agenda waits on no one and if you’re among those driving the 228 million “other” vehicles, tough nuts.

The government has said 15%.  Nuff said.

BMW, Chrysler, Nissan, Toyota and VW said their warranties will not cover fuel-related claims caused by E15. Ford, Honda, Kia, Mercedes-Benz and Volvo said E15 use will void warranties, says Darbelnet, citing potential corrosive damage to fuel lines, gaskets and other engine components.

Gee, I wonder if anyone will question the “fairness” of this.

Anyone doubt who will pick up the tab for this, Mr. and Mrs. Consumer?

~McQ


Economic Statistics for 30 Nov 12

The following US economic statistics were announced today:

Personal Income was unchanged in October, while spending fell -0.2%. Both the headline and core the PCE Price Index rose 0.1%. On a year-over-year basis, both income and spending rose 3.1%, while inflation rose 1.7% at the headline level and 1.6% at the core level.

The Chicago Purchasing managers Index is essentially unchanged for November, up 0.1 points to 50.4, indicating barely any growth.

~
Dale Franks
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Economic Statistics for 29 Nov 12

The following US economic statistics were announced today:

Chain stores are reporting mostly lower sales growth for November, as weak sales early in the month wasn’t offset by stronger sales later.

Initial claims for unemployment fell 23,000 last week, to 393,000. The 4-week moving average remains high at 405,250. Continuing claims fell 70,000 to 3.287 million.

The first revision for 3rd Quarter GDP was revised upwards substantially to 2.7% annualized, but due to inventories, not demand growth. Consumer spending and business equipment were both revised downwards. The GDP Price Deflator, an inflation measure, remained high at 2.7%, though the core rate, ex-food and energy, was revised down to 1.3%.

Corporate profits in the 3rd quarter grew to $1.752 trillion annualized, versus $1.665 trillion in the 2nd quarter.

The Pending Home Sales Index rose 5.2% to 104.8 in October.

The Bloomberg Consumer Comfort Index rose 0.9 points to -33.0.

The Kansas City Fed Manufacturing Index fell to -6 in November, down from -4 in October.

~
Dale Franks
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“Fiscal Cliff” negotiations with Democrats? Gimme the usual please …

When is the GOP (and the public) going to learn?

How many times have we heard that the only thing standing in the way of a grand bargain to reduce our growing national debt is Republican intransigence on taxes? If Republicans would only agree to dump Grover Norquist, Democrats will agree to cut spending and reform entitlements. Then, we can all join hands and sing Kumbaya as we usher in a new era of compromise and fiscal responsibility.

Except that now that Republicans have agreed to raise taxes, er, revenue, as part of an agreement to avoid the looming fiscal cliff, liberals appear to have decided that there really isn’t a need to cut spending after all.

Yup, in fact they’ve taken entitlement reform “off the table”.

Senate Democratic leaders signaled Tuesday they would not agree to any entitlement reforms before the end of the year that cut spending on Medicare and Medicaid beneficiaries.

They also said that any year-end deal to avoid the expiration of tax cuts and implementation of spending cuts — known as the fiscal cliff — must include a provision to raise the debt ceiling, which would otherwise have to be addressed early next year.

The White House and Reid have indicated they will not consider cuts to Social Security, a notable change from 2011, when President Obama said “everything is on the table,” including entitlement programs dear to his party’s base.

In other words, we’re back to “tax the rich”, raise the debt ceiling and spend, spend spend.  Meanwhile, it is left up to the GOP to “compromise” by breaking the tax pledge (led by the Judas goats, Saxby Chambliss and Lindsey Graham) or be forever branded as the intransigent “bad guys” in this.

Meanwhile, low information Americans who, by over 60% approve of taxing the rich, will buy the spin by the press painting the GOP as the cause/reason for the calamity while Democrats “lament” the problem (“but, hey, that’s now the law thanks to Republicans”) and gleefully rub their hands in delight at all the new revenue they’ll have to “redistribute”.

Some things never change, do they?

~McQ


Worst. Pro-Assault. Weapon. Ban. Argument. Ever.

Interested in seeing one of the dumbest attempts to counter an argument against reinstituting the “assault gun” ban?

It’s, well, pretty pathetic, and, coming out of Media Matters, shouldn’t really surprise you.

First the graphic that started it all:

Okay, you’re in the ballpark now.

The Media Matters person (Timothy Johnson) says:

The image was created by a blogger who used it to argue in favor of the ban, writing that “If you can buy the gun on the top, but can’t buy the bottom gun, who cares? You still have a gun.” McArdle responded that “if it makes no difference, than why have the law?” and argued that “‘assault weapon’ is a largely cosmetic rather than functional description.”

But Johnson says there are vast differences which mean that, hey, they’re just not the same.  The bottom one, per Johnson, is much more lethal.  And he’s got the reasons why:

In fact, the lower pictured weapon, a Mossberg 500 Tactical Persuader, has a number of features that increase its lethality compared to the top pictured shotgun. Contrary to what the graphic suggests, the only difference between the two weapons is not just the pistol grip featured on the Tactical Persuader. The Tactical Persuader also has an adjustable stock that can be removed from the firearm completely, which allows the gun length to be shortened for increased concealability. Furthermore, when combined with a pistol grip, the firearm can be more easily maneuvered, allowing the shooter to fire from the hip and more easily use the weapon from vehicles and in other close quarters situations.

An almost identical configuration was sought out by Suleman Talovic, a teenager who used a Mossberg-derivative pistol grip shotgun during a rampage that killed five and wounded four at the Trolley Square Mall in Salt Lake City, Utah on February 12, 2007. A recent report issued by the John Hopkins Center for Gun Policy and Research found that firearms with assault weapon features are disproportionally used in mass shootings and that when used result in higher numbers of casualties.

OK?  You get my point about silly?

A “pistol grip” doesn’t “increase lethality” unless you beat someone over the head with it (by the way, I can make a pistol grip on the other using a saw in about 5 minutes, or, just buy one aftermarket and install it on the top gun).  Pistol grips are non-lethal “features”, not lethal weapons.

Secondly, being able to conceal something doesn’t make it more lethal either.  It simply means you can hide it better.  How hiding something better becomes “lethal” will have to be answered by Mr. Johnson who seems not to know what “lethal” actually means.

In fact the blogger is correct – they are exactly the same gun where it counts.  And to be lethal, you must still load them, point each of them at someone and pull the trigger.   One doesn’t shoot more rounds than the other, one doesn’t use a “bigger” round than the other, one won’t shoot faster than the other.   They are each 12ga 6 round pump shotguns.  Period.

Finally, correlation is not causation (i.e. the gun made him do it where he might not have had he had the top shotgun available instead) and the fact that someone on a rampage chose a shotgun with a pistol grip over a rifle stock doesn’t make the one with the pistol grip more lethal (I do wish this guy would look up “lethal”).

Additionally the fact that one might be able to be used in “close quarters” better than the other again doesn’t make it more lethal.  It simply provides a perceived advantage over the other that may or may not, in fact, play out.  If, however, it is something anyone would want, it is easily done to the top gun with a minimum of effort or cost.

Then, I assume, thinking he has just nailed it by pointing out the “lethality” of the pistol grip, he throws this up from some activist group that is just about as silly as the rest of his stuff:

All assault weapons–military and civilian alike–incorporate specific features that were designed for laying down a high volume of fire over a wide killing zone. This is sometimes known as “hosing down” an area. Civilian assault weapons feature the specific military design features that make spray-firing easy and distinguish assault weapons from traditional sporting firearms.

Civilian “assault weapons” or those which look like them are “semi-automatic” by law.  Military assault weapons usually have the option of automatic fire.  It is on the automatic selection that a large volume of fire is going to be projected (and, unless you know what you’re doing, very ineffectively).  Civilian guns don’t have that option.  They’re not the same freakin’ thing regardless of how they look!

Consequently they’re not going to be doing any “spray firing” or “hosing down” of an area in semi-auto mode.  Can a semi-auto put out a decent amount of fire?  Yes, especially if it has a large capacity magazine.  But those two shotguns in question are pump action and only hold 6 rounds each.

Shotgun A will fire no faster or slower than shotgun B in the picture above.  If A can do it, so can B and the reverse is also true.  And whatever they do will involve shoot, pump, shoot, pump, shoot, pump etc.  The bottom shotgun doesn’t go “boom, boom, boom, boom, boom”.  It does exactly what the top one does – “boom, pump, boom …” (I wanted it to make it easy for Johnson to understand).

So, in sum, the blogger is correct, but even more correct is Megan McArdle.   What’s the point?  They’re pump action shotguns that are, except cosmetically, exactly the same (and each can be modified in any number of ways from their stock appearance).  What again is the point of the law?

Uh, control, that’s what.

~McQ



So why are private unions in decline and government unions still strong?

If you haven’t figured it out yet, it has to do with competition in one area and none in the other.

How so?  James Taranto sums it up pretty nicely on the private union side of things:

The trouble for private-sector unions is that the global economy vastly increases the supply of labor, diminishing their bargaining power. If it’s too expensive to run a factory in the U.S., companies can simply move their facilities to other countries.

Or, labor isn’t worth what it once was thanks to globalization. We call that “economic reality”.  Back in the good old days for unions, they were getting wonderful pensions, outrageous benefits and $20 bucks an hour for a guy to open and close a blast furnace door.  Now they can make and ship steel across the Pacific Ocean and truck it to its destination in the US cheaper than we can make it.  Thus the shift of the industry from here.

The bonus for these companies?  No labor negotiation hassles, lower wages to pay (comparatively) and the option to move again if the costs again become onerous (and the steel industry has done that a couple of times).

However labor hasn’t yet allowed that lesson to sink in – well, at least unions haven’t.

Taranto points to a very recent example of the point as well as some union members who “get it”:

Last May, after contract negotiations stalled, nearly 800 IAM-represented employees walked off the job at Caterpillar’s hydraulic-parts factory. After a few weeks, more than 100 returned to work, fed up over the lack of progress in the talks and pinched by the union’s $150-a-week strike pay, some workers say.

When an agreement was reached in mid-August, the contract provided less than the one before it: The IAM gave in to an hourly pay freeze for veteran employees, an end to pensions, a doubling of health care premiums and a one-time ratification bonus of $3,100 instead of $5,000 under the previously proposed pact. The terms were almost identical to a Cat contract ratified by the UAW [United Auto Workers] a year earlier.

Doug Oberhelman, chairman and chief executive of the Peoria-based heavy-equipment maker, acknowledges that the givebacks hurt employees. But, in a recent speech in Chicago, he explained that management compared compensation to factory hands across Illinois and around the world and concluded that to be “market competitive,” Caterpillar had to insist on the concessions.

100 of the members of the International Association of Machinists apparently saw the handwriting on the wall, figured their family came first and returned to work.

So much for solidarity.

Hostess is another example of out of touch private sector unions.  When the Teamster’s union confronted Hostess over its claims it couldn’t afford their demands and giving into them would cause the company to have to liquidate, the Teamsters examined Hostess’s books and agreed.  They backed off.  Not the Baker’s union though.  Apparently their union chief never bothered to examine the books or negotiate.  He just advised his union to strike.  The result is well known and, by the way, the Teamsters were livid – not at Hostess, but at the Baker’s union.

Meanwhile a few facts have surfaced about the Baker’s union boss that should make members of unions everywhere recognize at least this guy for what he is:

BCTGM boss Frank Hurt encouraged the strike (knowing it could shut down the company).

As BCTGM membership has fallen 30% since 2000, Hurt’s salary has gone up nearly 45% to over $260,000

The bakery industry union pension fund is less than 50% funded ($10 billion in liabilities), yet bakery union bosses have their own fully-funded (100%) pension plan — funded by members.

Bakery union bosses Hurt and the Sec.-Treasurer both have their kids on union payroll.

We often hear complaints about CEOs who get pay raises while their companies go down the tubes.  I wonder if the left is willing to apply the same criticism to a guy who raises his own pay 45% while losing 30% of the membership and funds his own pension 100% while shorting the union member’s fund by over 50%?

Unions also tend to play at stupid games that simply frustrate people trying to run a business and make a profit.  In this case it is two different unions fighting about who gets to plug in and unplug refrigerated containers.

A federal judge has been forced to intervene in a dispute between two unions over who is in charge of plugging and unplugging refrigerated shipping containers at the Port of Portland.

Oregon district court judge Michael H. Simon ordered the International Longshore and Warehouse Union (ILWU) to abandon its efforts to snatch the responsibility of manning the outlets from the rival International Brotherhood of Electrical Workers (IBEW).

“[The ruling] simply means that the same people who have been doing the work since 1974 will continue to do it,” said IBEW spokesman Norman Malbin.

Absurd.

The ILWU’s reaction?  It said the contract with the electrical workers represented a “lost work opportunity” for members.  Of course it was a job they’d never had nor had when they tried to take it over.  But these are the sorts of things private unions are reduced too these days.  Stealing each other’s jobs.

As we’ve covered here, the great Wal-Mart walkout wasn’t a spontaneous event or even an event demanded by the workers of  Wal-Mart.  In fact, as mentioned, only 50 of 1.4 million Wal-Mart workers even walked out.

It was a union event using the front group “OUR Wal-Mart (Organization United for Respect at Wal-Mart)”, it was all set up by the United Food and Commercial Worker’s Union.   And if flopped, hideously.  In fact, the real reason the UFCWU tried to make this happen is because their stores are uncompetitive with Wal-Mart grocery stores.  If you can drive up salaries and benefits, you’ll eventually drive up prices.  You?  They couldn’t care less about you, Mr. and Ms. Consumer.

Those examples all deal with private unions.  Competition and the cost of labor are driving the reality of today’s wages.   Unions can’t deliver on the big promises anymore.  Many have not done a good job of managing their members benefits either.  Smart companies make it clear that they will willingly provide good wages and benefits without unions.  Tack on tough economic times and the need for a union becomes even less apparent.  At one point paying union dues was considered to be a positive thing.  Workers got something for the dues that they felt was greater than the cost of the dues.   Today?  More and more are seeing those same dues as a liability.

Finally, government unions.   They remain strong because there is no competition.  And, their bosses are in bed with them, negotiating with your money, not theirs.  Government’s don’t have to make a profit to stay in business, do they?

But perhaps even their act is wearing a little thin.  Take the LAX protests by the SEIU:

At LAX, although a large crowd of union members came out to protester, CBS LA notes that ”the majority of them [the protesters] were not airport workers.” They were other members of the SEIU.

So troubled were the airport workers by the Thanksgiving Day protest, the Associated Press reports that according to a press release from former union members, “a majority had signed petitions to leave the union and called upon the SEIU to cancel the demonstration.” One former union member Fred McNeill admitted to CBS LA that it had gotten “personal” for the leadership of the SEIU, “And that’s just not right.”

Another woman, who CBS LA interviewed through her car window at the airport, said she she was a union member (she did not specify which union she belonged to), but even she didn’t agree with the way the union was blocking traffic on one of the busiest travel days of the year.

Unions on both sides have become short-sighted and petulant because their golden age is demonstrably dead.  Economic reality and a changing world have dealt them severe blows and instead of looking at ways to shore up their base and maintain their presence, they’re reduced to throwing tantrums and thumbing their noses at the very people they need to suppor their cause.

Government unions can still get away with that.  Private unions can’t.   And the only reason that difference is made is because competition and economic reality rule one side and monopoly and government protection rule the other.

~McQ


Laugh of the day: Arab Spring

I do love this title in The New Republic … TNR of all places: “Shame on Anyone Who Ever Thought Mohammad Morsi Was a Moderate”

I do admit to laughing out loud when I read it, but I also thought that it was a bit too specific. In fact, and when you read the article I’m sure you’ll agree, the title should have read “Shame on Anyone Who Ever Thought the Muslim Brotherhood Was Moderate.”

But if that sort of article can show up in TNR, it indicates that at least some Western Liberals may have taken off the blinders and are now, finally, dealing with the reality of what “Arab Spring” brought. In Egypt’s case an extremist Islamist with dictatorial tendencies.

Granted Hosni Mubarak wasn’t exactly a peach of a guy. A dictator by any other name is still a dictator. But in terms of the interests of the United States and peace in the Middle East, he did a fair job on keeping a lid on the Islamists in his country like, well, Morsi.

It appears, though, and I hate to say we told you so, but a) the best organized group took power (i.e. the Muslim Brotherhood) and b) they’re reverting to form (i.e. Islamist totalitarianism).

Oh, sure, there are demonstrations and riots going on in Egypt right now against Morsi’s move, but you had better believe the Muslim Brotherhood is mobilizing to counter them. The only reason Morsi hasn’t stomped them right now is likely two-fold. World opinion (he just got a huge pat on the back for the Israeli/Palestinian cease fire – one “aw crap” negates any “attaboys”) and the fact that he likely hasn’t consolidated power to the point that he feels comfortable in doing so via the army. But his power grab certainly removes all doubt about his “democratic” leanings or lack thereof, doesn’t it? And, like I said, he’ll let the Brotherhood do the heavy lifting if it comes to that.

I’m sure this is quiet disappointing to the liberals who were sure democracy would flower in a country with no democratic institutions, no democratic history and an organized extremist group poised to exploit the troubles and sieze power, but then they’re the same sort of “fellow travelers” who thought Uncle Joe Stalin ran a heck of a good gulag show in the good old USSR, weren’t they?

~McQ


CO and WA’s pot laws – what’s going to happen?

Colorado and Washington had referrendums on their ballots this past election day in which growing pot for one’s own use was legalized.  Much like home brewing laws, users were given the go ahead to grow enough marijuana for their own, private use.

So what does that mean in the big scheme of things?  Certainly it will mean that at a state level, given the new law, state and local police aren’t going to be looking for small time users or growers.   And the Fed certainly doesn’t have the manpower to go after them.

The Washington Post points out:

But it’s unrealistic and unwise to expect federal officials to pick up the slack left by state law- enforcement officers who used to enforce marijuana prohibitions against pot users and small-time growers. Unrealistic, because it would require lots more resources.

Resources they don’t, frankly, have.

So here we have two states acting as sort of “labs” for freedom.  You know, trying something out as we were told states should do under a “federal” system.

Now, you may not agree about this particular application, but that’s how this system was supposed to work, wasn’t it?

The next obvious question then is will the Federal government allow that to happen or will it attempt to stop it.   My guess is even the Federal government knows it can’t stop it physically, so it will likely resort to legal means (i.e. somehow have the laws declared invalid, thereby again making Federal law supreme and requiring LEOs to enforce them).  But that could be a very long and protracted process.

For once (is there a blue moon out there?) in a very long time, the Washington Post and I agree for the most part:

[W]e favor decriminalizing possession of small amounts of pot, assessing civil fines instead of locking people up. Also, for that reason and others, the Justice Department should hold its fire on a lawsuit challenging Colorado and Washington’s decision to behave more leniently. And state officials involved in good-faith efforts to regulate marijuana production and distribution according to state laws should be explicitly excused from federal targeting.

It’s not yet clear how a quasi-legal pot industry might operate in Colorado and Washington or what its public-health effects will be. It could be that these states are harbingers of a slow, national reassessment of marijuana policy. Or their experiment could serve as warning for the other 48 states.

For now, the federal government does not need to stage an aggressive intervention, one way or the other. It can wait, watch and enforce the most worrisome violations as they occur.

Where we disagree is the next to last sentence.  If you’re going to stay out of it now, stay out of it later.  You can’t “leave it up to the states” until you decide not too.  And, it would be a nice decentralization of power – you know, federalism – which allow the states what they were originally supposed to enjoy – a certain level of autonomy (remember, the federal government was originally supposed to be mostly focused externally while the states, within Constitutional limits, pretty much looked after themselves.).

It would be a nice change from the constant attempts by the Fed to accrue power.

~McQ


Economic Statistics for 27 Nov 12

The following US economic statistics were announced today:

In weekly retail sales, Redbook reports a big 4.5% increase from the previous year. Similarly, ICSC-Goldman reports a weekly sales increase of 3.3%, and a 4.0% increase on a year-over-year basis.

Durable goods orders were unchanged in October, though they were up 2.3% on a year-over-year basis. Ex-transportation, orders were actually up 1.5% for the month, but down -2.3% from last year.

Case-Shiller’s seasonally adjusted monthly home price index rose 0.4% in September, the third consecutive monthly increase.

The Conference Board’s consumer confidence index improved in November to a reading of 73.7.

The FHFA House Price Index rose 0.2% for September, and was up 4.3% on a year-over-year basis.

The Richmond Fed Manufacturing Index rose sharply to 9 from last month’s -7, as activity picked up in the district.

State Street’s investor confidence index for November remains "quite weak" at 81.2.

~
Dale Franks
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