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Free Markets, Free People

Economic Statistics for 19 Jun 13

Here are today’s statistics on the state of the economy:

The MBA reports that mortgage applications fell -3.3% last week, with purchases down 3.0% and re-fis down 3.0%.

The FOMC says that interest rates will remain unchanged for the present, but warns that the current easy money regime is coming to and end, or at least slowing. The Committee envisions a slowdown in the current round of Quantitative easing by the end of the year.

~
Dale Franks
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Regulation nation a symptom of an incurable disease?

Niall Ferguson has a piece in the Wall Street Journal which talks about the growth of regulation within the nation.  He starts with a quote from de Tocqueville in which de Tocqueville marvels at how Americans manage to self-regulate through associations.  He then notes that de Tocqueville wouldn’t recognize the US if he were to suddenly come back.  It looks too much like Europe.

Why?

Regulation has crept in to help smother us all the while the culture has changed to where Americans seem to no longer look to each other to solve problems, but instead look to government.

Regulations are simply a symptom of this business and autonomy killing movement.  And their growth track pretty well with our demise:

As the Competitive Enterprise Institute’s Clyde Wayne Crews shows in his invaluable annual survey of the federal regulatory state, we have become the regulation nation almost imperceptibly. Excluding blank pages, the 2012 Federal Register—the official directory of regulation—today runs to 78,961 pages. Back in 1986 it was 44,812 pages. In 1936 it was just 2,620.

True, our economy today is much larger than it was in 1936—around 12 times larger, allowing for inflation. But the Federal Register has grown by a factor of 30 in the same period.

The last time regulation was cut was under Ronald Reagan, when the number of pages in the Federal Register fell by 31%. Surprise: Real GDP grew by 30% in that same period. But Leviathan’s diet lasted just eight years. Since 1993, 81,883 new rules have been issued. In the past 10 years, the “final rules” issued by our 63 federal departments, agencies and commissions have outnumbered laws passed by Congress 223 to 1.

Right now there are 4,062 new regulations at various stages of implementation, of which 224 are deemed “economically significant,” i.e., their economic impact will exceed $100 million.

The cost of all this, Mr. Crews estimates, is $1.8 trillion annually—that’s on top of the federal government’s $3.5 trillion in outlays, so it is equivalent to an invisible 65% surcharge on your federal taxes, or nearly 12% of GDP. Especially invidious is the fact that the costs of regulation for small businesses (those with fewer than 20 employees) are 36% higher per employee than they are for bigger firms.

Got that?  224 new regulations which will have an economic impact that will “exceed $100 million” dollars.  Negatively of course.  That was the purpose of having regulations rated like that – to understand the probable negative economic impact.  And we have 224 in the hopper, in a very down economy, which will exceed the negative $100 million dollar mark.  What are those people thinking?  Or are they?  Indications are they give it no thought when these new regulations are proffered. They just note the cost and move on. No skin of their rear ends.

And if you think that’s bad, just wait:

Next year’s big treat will be the implementation of the Affordable Care Act, something every small business in the country must be looking forward to with eager anticipation. Then, as Sen. Rob Portman (R., Ohio) warned readers on this page 10 months ago, there’s also the Labor Department’s new fiduciary rule, which will increase the cost of retirement planning for middle-class workers; the EPA’s new Ozone Rule, which will impose up to $90 billion in yearly costs on American manufacturers; and the Department of Transportation’s Rear-View Camera Rule. That’s so you never have to turn your head around when backing up.

Yes, that’s right, they’re hardly done. In fact, they’re not even slowing down. The accumulation of power within the central government – the ability to intrude in almost every aspect of your life – is attempting to reach warp speed.

Finally, as if what I’ve noted isn’t enough, we have another costly travesty in the gestation stage, i.e. the “Gang of 8’s” immigration bill.  From PowerLine:

The CBO confirms that the bill provides for a vast influx of new, legal immigration. The Senate Budget Committee says:

CBO projects 16 million new immigrants will be added by 2033 on top of the current law projected flow of 22 million and that 8 million illegal immigrants will be granted permanent status – for a total of 46 million legal immigrants, including a doubling of guest workers to 1.6 million in a single year.

Contrary to the claims of the bill’s sponsors, this influx will be overwhelmingly low-skilled. The CBO says:

[T]he new workers would be less skilled and have lower wages, on average, than the labor force under current law.

The result is that unemployment will increase, and wages will be driven down, for America’s existing blue collar work force:

Taking into account all of those flows of new immigrants, CBO and JCT expect that a greater number of immigrants with lower skills than with higher skills would be added to the workforce, slightly pushing down the average wage for the labor force as a whole… However, CBO and JCT expect that currently unauthorized workers who would obtain legal status under S. 744 would see an increase in their average wages.

Terrific: the only ones who would gain would be those who came here illegally, while native born workers would suffer. The CBO report continues:

[T]he average wage would be lower than under current law over the first dozen years. … CBO estimates that S. 744 would cause the unemployment rate to increase slightly between 2014 and 2020.

Ruinous? Along with everything else, pretty much.

To say America has lost it’s way is, well, an understatement. We aren’t close to being what was envisioned at our founding and we’re almost kissing cousins of that which our Founders attempted to keep us from becoming – today’s Europe.

Unfortunately, that ruinous drift and over reliance on government seems to be fine for all too many of those who call themselves Americans today.

~McQ

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Economics statistics for 18 Jun 13

Here are today’s statistics on the state of the economy:

In weekly retail sales, ICSC-Goldman reports a 0.3% weekly sales increase, and a 2.5% year-over-year gain. Redbook reports a 2.9% annual increase.

May Housing Starts rose 6.8% to a 0.914 million annual rate, climbing back from a steep drop the previous month.

The Consumer Price Index rose 0.1% in May, with core rate, ex-food and -energy, rose 0.2%. On a year over year basis, the CPI is up 1.4% while the core CPI rose 1.7%.

~
Dale Franks
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And you wonder why we’re getting involved in Syria?

Really?

A growing number of Americans believe that senior White House officials ordered the Internal Revenue Service to target conservative political groups, according to a new national poll.

And a CNN/ORC International survey released Tuesday morning also indicates that a majority of the public says the controversy, which involves increased IRS scrutiny of tea party and other conservative groups seeking tax-exempt status, is very important to the nation.

Look, Obama’s legacy is important to Democrats because it may mean victory or defeat for the next Democratic presidential candidate.   And like it or not, a scandal plagued 2nd term isn’t going to help his legacy or the Democrat’s next chosen presidential candidate.  In fact, one of the reasons Obama is in the White House now is the successful negative portrayal of the Bush years by the left and the press.

In the case of Obama, the press and done it’s best to dampen the reach of the scandals, but it is, for once, failing in it’s endeavor.  The scandals are too wide ranging and hit too close to home to fears the citizenry has held concerning government’s abuse of power.  And make no mistake, these scandals are all about abusing power.

Last month only 37% of the public thought that the IRS controversy led to the White House, with 55% saying that agency officials acted on their own without direct orders from Washington. Now the number who say the White House directed that IRS program has increased 10 points, to 47%, virtually the same as the 49% who believe the IRS agents acted on their own.

“Younger Americans are much less likely than older Americans to believe in White House involvement, and there is, not surprisingly, a partisan divide as well,” says CNN Polling Director Keating Holland. “But the Obama administration may be losing independents on this matter. In May, only 36% felt the White House ordered the IRS to target conservative groups; now that number has crossed the 50% threshold.”

Of course naive youngsters who really haven’t been around for or paid attention to scandals of the past, certainly might want to believe their idol, Barack Obama, is involved in this.  But you can see as well as I can, as more and more info comes out, that minds are changing.  This is a serious shot at the Obama legacy.  Or at least that’s what 51% of Americans are saying:

Fifty-one percent of those questioned said the IRS controversy is a very important issue to the nation, compared to 55% who felt that way in May. In the past week and a half, the IRS story has been put a bit on the backburner, as the controversy over the federal government’s massive surveillance program has dominated the spotlight.

Ironic, no?  The 4% drop I mean.  It has dropped as a “very important issue to the nation” because another scandal has popped up.

So what’s the Obama playbook say you do when it goes from bad to worse?

Distract.

Hello Syria ….

~McQ

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Syria – so now what?

Our local Noble Peace Prize winner has put himself in quite a quandary, hasn’t he? He’s decided that since he thinks Syria has used chemical weapons, it is our business to intrude on what is essentially a civil war, and give arms to an opposition whose makeup includes Islamic terrorist groups. Because, you know, some “bright line” has been crossed … or we think has been crossed, and according to R2P (apparently) we have to “P” or something (I guess the horrific numbers of death just weren’t enough to invoke that until chemical weapons, huh?).

Of course an obvious possibility in this case, since the Syrian government thinks that it is being punished for the use of chemical weapons, is they’ll now say “screw it” and use them liberally. I mean, why wouldn’t they? Even if they haven’t used them, there’s no “up” side anymore for them not using them now is there? World condemnation? We’ll we’re in the middle of manufacturing that right now, aren’t we?

Meanwhile you might remember that we “reset” relations with Russia because that darn Bush administration had screwed them up so royally.

Russia, a veto-wielding member of the U.N. Security Council, will not permit no-fly zones to be imposed over Syria, Foreign Ministry spokesman Alexander Lukashevich said on Monday.

“I think we fundamentally will not allow this scenario,” Lukashevich told a news briefing, adding that calls for a no-fly zone showed disrespect for international law.

Oh. Wait. Didn’t they tell us if a Republican was elected we’d see relations with Russia head back toward the Cold War era (btw, what Russia is alluding to is hurrying the deployment of the advanced S-300 missile system if we persist in this nonsense)?

Syria is a “no-win” situation for us if we intervene. Most of the intel I read says the opposition is riddled with Islamic extremists and Islamic extremist groups. Is it wise to arm such people? Well, a sane person would say “no”. A sane person would also stay the heck out of interfering in Syria.

But there are scandals to be dampened and distractions to be made. Because, you know, the Chosen One’s rep is much more important that a sane foreign policy or the lives of our military members.

~McQ

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Observations: The QandO Podcast for 16 Jun 13

This week, Bruce, Michael, and Dale discuss Scandalpalooza and Syria.

The direct link to the podcast can be found here.

Observations

As a reminder, if you are an iTunes user, don’t forget to subscribe to the QandO podcast, Observations, through iTunes. For those of you who don’t have iTunes, you can subscribe at Podcast Alley. And, of course, for you newsreader subscriber types, our podcast RSS Feed is here.

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Economic Statistics for 14 Jun 13

Here are today’s statistics on the state of the economy:

Producer prices jumped 0.5% in May, while the core rate, ex-food and -energy, rose 0.1%. On an annual basis, prices rose 1.8% overall, and 1.6% at the core.

The nation’s current account deficit for the 1st Qtr came in at a smaller-than-expected $106.1 billion.

Foreign demand for long-term US securities rose to $-37.3 billion in April, the third consecutive monthly outflow of capital.

Industrial production was unchanged in May, while capacity utilization in the nation’s factories fell 0.2% to 77.6%.

The Reuter’s/University of Michigan’s consumer sentiment index fell 2.2 points to 82.7.

~
Dale Franks
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We can’t have ObamaCare effect these folks – they’re “federal employees” for heaven sake!

When I read articles like this they infuriate me.

Dozens of lawmakers and aides are so afraid that their health insurance premiums will skyrocket next year thanks to Obamacare that they are thinking about retiring early or just quitting.

The fear: Government-subsidized premiums will disappear at the end of the year under a provision in the health care law that nudges aides and lawmakers onto the government health care exchanges, which could make their benefits exorbitantly expensive.

Why?  Because there doesn’t seem to be any ability to relate their problem with the problems they’ve imposed on business through their ramming through this horrific legislation we call “ObamaCare”.  Even with the effects beginning to be understood, like that above, they don’t get it:

Rep. John Larson, a Connecticut Democrat in leadership when the law passed, said he thinks the problem will be resolved.

“If not, I think we should begin an immediate amicus brief to say, ‘Listen this is simply not fair to these employees,’” Larson told POLITICO. “They are federal employees.”

But apparently it is “fair” to the employees of business who, in some cases, will see 100% plus increases in their premiums.  It only becomes a problem when it effects who?  Why, ‘federal employees’, of course.  You know, our so-called “public servants”.  And then, apparently, only that subset of federal employees that work for Congress.  They seem oblivious to the fact that the same thing is happening in thousands of places and effecting multi-thousands of businesses.  Freakin’ clueless.

Even as mad as this made me, I got a chuckle out of this:

If the issue isn’t resolved, and massive numbers of lawmakers and aides bolt, many on Capitol Hill fear it could lead to a brain drain just as Congress tackles a slew of weighty issues — like fights over the Tax Code and immigration reform.

Talk about silver linings to storm clouds.

~McQ

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Economic Statistics for 13 Jan 13

Here are today’s statistics on the state of the economy:

Initial jobless claims fell 12,000 last week to 334,000. The 4-week average fell  7,250 to 345,250. Continuing claims rose 2,000 to 2.978 million.

May export prices fell -0.5% while import prices fell -0.6%. On a year-over-year basis, export prices fell -0.9% while import prices fell -1.9%.

May retail sales rose 0.6%, while sales ex-autos and ex-autos and -gas both rose 0.3%.

April business inventories rose 0.3%, while wholesale sales fell -0.1%.

The Bloomberg Consumer Comfort Index fell more than 2 points to -31.3.

~
Dale Franks
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