Wednesday, November 05, 2008

Prediction: A Change of Tune

Just a prediction from your friendly neighborhood pre-professional prognosticator, but watch carefully over the next days, weeks, and months as a new tune is sung. From Obama himself to his staff to his press agents on down to just his supporters, you will begin to hear backpedaling, you will hear downplaying and lowering of all the hype, promises and expectations of Obama’s campaign.

Now that they have promised money, global peace, pies, unicorns and rainbows for every man, woman, and child in order to win the election, you will now hear them begin to speak of reality again. They will subtly start telling people not to expect “change” for awhile. They will imply that we should “hope” not for a new and brighter future, but just that things don’t get any worse.

Examples to be on the watch for:

“Let’s be realistic.”
“We have to be patient.”
“We can’t expect change overnight.”
“It will take time for his policies to effect things.”
“Things are so bad that it may be awhile before we see any improvement.” (This ‘bad’ will be blamed on Bush of course)

Not to mention Obama’s favorite history re-writing catchphrase:

“What I’ve said is …”

After losing even more seats in Congress, the best thing Republicans can take away from this election is that for once, Democrats won’t have someone else to blame and point the finger at when things go bad.


What am I saying, Bush’s legacy will live on for years and years in the form of insinuations and outright accusations.

So says the Great Swammi

Sunday, May 11, 2008

Help Fight Log Rolling (apologies to Lumberjacks)

In my reading about "log-rolling" (the term that describes the legislative bundling I was talking about earlier), I came across DownsizeDC. This site believes that the govt is too large and needs to be slimmed down. As an example (and primary culprit) of this monstrosity, it explains how Congress has lacked to fulfill its responsibilities to the people regarding making laws. Two proposed pieces of legislation that aim help that situation are the 'Write the Laws Act' and the 'Read the Bills Act'.

When this country was founded, they specifically designed Congress to be slow and lethargic. Well, Congress found a way around it by creating these organizations like the FDA, FAA, SEC, etc, etc ad nauseum. Each of these organizations don't just make guidelines, but regulations.

To summarize, the WTLA says that Congress has delegated the creation of laws and regulations to these unelected groups of bureaucrats. Worse even than this is that then these bureaucrats have then granted themselves the authority of prosecutor, judge and jury for those that may break the rules.

Take, for example, the early April grounding of hundreds of American Airlines planes. Well, this wasn't a law enacted by Congress. This was a regulation made by the FAA. And what was the regulation that American Airlines so cavalierly ignored at the risk of peril to their very customers? Well, the FAA says that the cabling in the landing gear must be bundled by zip ties (or equivalent) every 1 inch. Well, in an inspection, they found that American Airlines had the audacity to have gaps of not only 11/8inches, and 11/4inches, but even 11/2inches!!!! *gasp* The gaul!

So the WTLA basically says that an individual or organization can only be held legally liable to laws that Congress makes. Now when I first read about this, I wondered what would happen if we actually enacted something like this. Would businesses suddenly start doing whatever they wanted at the expense of the consumer? Would foods suddenly start containing rats and leading to food poisoning because of the cleanliness standards now lacking teeth to enforce them? Would planes start falling out of the sky because the safety regulations have no muscle? Would we go back to the days before government oversight when "buyer beware" wasn't just because it might cost you a little extra money? The reason I don't believe this is simple: the Internet! Consumer watchdog groups are all over the place and with the advent of the internet, people can now more easily determine which companies are lacking the high quality we expect now. And if for whatever reason, whether lack of money or being greedy capitalist pigs wanting to maximize profit at the expense of quality control, consumers and similar groups can more easily expose bad corporations willing to cut quality corners. Because of this, I believe that if a company gets a reputation for low quality, then they would begin to feel the consequences in revenue. Besides, if Congress determines that it's necessary that the airlines have certain safety regulations since it would be deadly not to, then it could pass the bill that contains those regulations.

This would also possibly free up another pet peeve of mine: licensing EVERYTHING. I can't open a shop in my own home to cut hair if I don't get a certified license from the govt saying ... I don't know, that I'm qualified not to cut someone's ear off I guess (which I probably am not ... thus the reason I don't have that license ... but that's beside the point). I could understand wanting to get a license to prove that I'm GOOD at cutting hair, but requiring it before someone can open such an establishment is just too much for me.

Anyway, the other law, the RTBA says that many of these laws don't even get read by members of Congress. They're put together so quickly and are so massive that they aren't actually read completely. This means that there are things that could potentially get slipped in unbeknownst to those Congresspersons that wouldn't agree to it, but because it doesn't get properly vetted, it slips through and becomes law. So the RTBA says that members of Congress must sign under penalty of perjury that either they read the bill in its entirety or that they were present if/when it was read out loud during a session of Congress. While I'm not sure that the 'reading out loud' part would pass, I do think that the concept of having them sign saying that they actually read it is a good idea. It at least puts the onus on them that they can't claim they didn't know some section was in there.

However, beyond the requirement on Congress to actually read the bills, one of the things that I most like about the RTBA is that it requires that the final version of the bill be made available online 7 days prior to voting it into law. If an amendment is made to a bill, it must again sit for 7 days online before it can be voted into law. (Obviously this could be overridden by a super-majority in an emergency.) I LOVE this idea. It allows govt watchdogs to have the time to really find the questionable appropriations, pork barrel projects, and other seemingly hidden clauses.

For another time, two additional things that I think would help clean up Washington:
  • Term limits
    • Consider perhaps 2, 6 year terms
  • Signed amendments
    • Every amendment, every inserted clause and whatnot, has the name of the legislator who made the motion for the change. This way we can see who wants to add what things.

Friday, May 09, 2008

Legislative Tarballs

Ok, here's a pet peeve of mine: bundling 47 completely different pieces of legislation into one bill. What a cop out!

Take the minimum wage hike that the Democrats pushed through in 2007. The title, Fair Minimum Wage Act of 2007, sounds like a self-contained piece of legislation, right? I mean, it's an entire ACT. However, here's the trick. Both parties in Congress got together and they merge all this stuff into one massive bill called:

U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007

So this bill, based on just the title, already deals with troops in Iraq, veterans health care, Katrina assistance allocations, and money for Iraq. There (which already seems like somewhat of a lot for one bill). Yet, they weren't done. They decided to include the Fair Minimum Wage Act of 2007 into a single section of the whole bill. Scanning throu
gh the text of the bill I feel that this whole thing is basically just one big "give more money to X program" bill. Which, if spent on US programs would only be questionable. But as I looked a little more closely, I found that there is allocated money for helping Liberia get out of debt, conditions for granting Pakistan an extra $5million, and conditions for possibly considering lowering the amount of money we give to Lebanon. I could go on and on with little questionable allocations, but beyond those questions, the main thing that I wondered was 'Why would they bundle everything in one massive piece of legislation like this? Don't they know that makes it harder to determine what's in the bill?'

Then it hit me. Of course they do. By putting both raising minimum wage (Democrat item) in the same bill as continuing the funding of Iraq (Republican item), they both win. They both look like they've successfully gotten what they wanted. And even better, if someone looks at their voting history and sees that they voted for this bill, they can each point to their own item and say "I voted for this bill because of this item. I believed it was more important than what was wrong with the rest." Not to mention that by making the whole thing so enormous, it's less likely that someone would stumble across some of these inane addendums. This is exactly how all those pork barrel projects get into these bills.

Now I'm not a policy expert, and definitely not a legal mind, but it seems to me it would be a good thing to require that a bill ONLY contains things that have directly to do with the title of the bill; or at least that the items in a bill explicitly have to do with each other. They should not be able to allocate money for a peanut factory in Georgia in the same bill that sets
business reporting requirements. Basically it should be proper parliamentary procedure to challenge a section of a bill that it isn't sufficiently related to the core subject of the bill. This would at least make those that want it in there to get up and defend why they want it included. I think it would be at least entertaining to see Senator Robert Byrd get up their and defend the need for his appropriation of money to the 'Robert L. Byrd Expressway' in the campaign finance reform bill.

Thursday, May 08, 2008

The Effects of Minimum Wage

I keep getting into discussions with liberal friends of mine about increasing the minimum wage. I have problems with minimum wage in general and especially with raising it. Now I'm not positive that getting rid of it altogether would be good, but I do believe that raising it causes small problems to be exposed and compounded, and bigger problems to become "crises" (sorta like we're seeing now). Now I'm not an economist, but despite the fact that I've heard remarkably little about the raise in minimum wage with regard to the current economic strain, I still feel that there's an impact that's going unreported. So I thought it through, past the initial hike and the more money people would initially get. I wanted to post the cause-and-effects with regard to minimum wage as I see them.

Firstly, let's make it clear. When the govt raises minimum wage, what they're doing is basically forcing companies to pay ALL of their employees more. Because when you raise the rate you have to pay your entry level positions, they would be earning the same as the second tier employees. Because these second level positions usually require some additional training or skills, you have to pay them more than the bare minimum. Then to keep wages competitive, corporations have to raise the amount they pay their third tier workers as well. Etc, etc on up the chain.

Remember that as long as we're in a capitalistic society, the goal of companies is to ethically make as much money as possible. Now, as I see it, in order to be able to pay all their employees more money, there are really only a few options they have:

  • Absorb the extra costs and take a cut in profits
    • Some would say this is acceptable considering how outrageously large the profits are for some of these corporations. Problem is, while these multi-billion dollar profit oil companies could probably absorb the increase, the vast majority of businesses in America are small-medium businesses.
      • [Admittedly, small businesses (<$125,000 revenue) get some tax cuts to help with the additional costs. However, I'm dubious if the cuts cover the entire cost of paying higher wages, so they still have to come up with more money.]
    • How would a non-profit deal with this?
    • Also ask yourself, how do you think the stock of a publicly traded company would react if the company suddenly announces a cut in profits?
  • Increase prices
    • If you don't take the money from profits, then you have to get more money from somewhere. So many companies will resort to increasing the costs of their goods and services. By increasing costs (and hoping their demand doesn't decline) they will look to increase revenue and hopefully be able to handle the extra expense of paying their workers more without reducing profits.
    • Now to me, the widespread increase in costs is basically artificial inflation. And inflation was the reason why people were shouting for the increase in minimum wage in the first place! So by increasing the minimum wage, we've indirectly increased the cost of living and artificially accelerated the rate of inflation. So in another 5-10 years, guess what they say is needed again?
    • [I'm picturing a dog chasing its tail right now.]
  • Lay off employees
    • If you don't take the money from profits and you don't increase prices to increase revenue, then you don't have enough money to spread out across the employees. So something has got to give. The next relief valve is to reduce the number of employees. So it's not surprising to me that we're now hearing about numerous companies laying off batches of workers.
  • Move overseas
    • Say you don't want to lose profits, price-tolerance says you can't raise prices, and you can't afford to reduce supply by eliminating employees. Now say you're considering updating or expanding production. What incintive is there to open a new factory in the US? Not much other than being closer/easier to manage and perhaps patriotism. Looking that the possible advantages:
      • Lower cost of materials
      • Lower cost of labor
      • Minimal environmental regulations
      • Less red tape and paperwork requirements
      • Lower taxes (a whole other article)
    • Add into that the fact that the US has free trade agreements with numerous countries and I'm surprised there are still even factories left in the US!
Now I'm not an economist. I have only looked at what seems to me to be logical cause-and-effect. And what we're observing in the economy lately seems to be support me. Please someone tell me where I'm wrong, because both Democrats are talking about raising it to a "living wage" which could be $10 or $11 /hour or more!

Economics Reading

I've been interested in learning more about economics. I'm going to assume that, as with most things, I don't even know how much I don't know. But I do know that I'm currently pretty libertarian in my views. I'm going to begin reading some in that vein (Ayn Rand, Milton Friedman, etc) and see if I agree with their views or not. After that, I may look for some opposing views and see what I think of them. Any suggestions?