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free trade & free markets international affairs repeal

The Milei Option

Argentina’s new president promised to take a chainsaw to the high taxes and controls that have been killing the country’s freedom and prosperity.

He has had successes. One of his decrees removed rent controls, and as a result the supply of rentals has jumped and rents have dropped.

But Milei cannot simply issue decrees to free up markets. He’s got to go through the legislature. And Argentina’s Senate recently rejected a mammoth Milei-issued emergency decree to deregulate the economy apparently in one fell swoop—revising or killing some 300 regulations.

The Financial Times reports that Milei’s coalition, La Libertad Avanza, “controls less than 10 per cent of Senate seats.” Many of the “centrist” senators could have helped pass Milei’s reforms over the objections of the adamantly leftist members. But these centrists profess to have constitutional reservations about the decree.

The real problem is probably that there is still a very large constituency for the subsidies and grift that have impoverished so many Argentinians.

The decree remains in effect until the House votes on it too. Milei’s administration is negotiating with the lawmakers of that chamber and with others who may have an impact on their vote.

If President Milei loses this fight in the near term, he must keep reminding voters why he can’t do more to lift them out of poverty and serfdom. His election to the presidency was a huge political change. But it’s not the only one Argentina needs.

This is Common Sense. I’m Paul Jacob.


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free trade & free markets political economy subsidy

When the CHIPS Are Weighed Down

Has DEI “killed the CHIPS Act”?

The CHIPS and Science Act of 2022 created a giant package of subsidies that shouldn’t exist to begin with and is made even worse by all the strings attached.

The Act authorizes giving $52 billion of taxpayer money to microchip manufacturers to make chips in the U.S. The boost to domestic production will supposedly help us if China invades Taiwan and disrupts Taiwan’s globe-leading microchip industry.

But chipmakers eligible for the largesse are recoiling from all the embedded DEI mandates. “DEI” means “diversity, equity, and inclusion.” It’s a collectivist mantra and ideology designed to make employers fret about racial and gender quotas and DEI indoctrination at the expense of hiring qualified people and making high-quality microchips.

According to Matt Cole and Chris Nicholson, writing for The Hill, nineteen sections of the Act are devoted to DEI. One gives the Department of Commerce a mission that Commerce describes as “strengthening the U.S. semiconductor ecosystem” by ensuring “significant investments to create opportunities for Americans from historically underserved communities.”

The authors believe that CHIPS is “so loaded with DEI pork that it can’t move.” Worse, it’s making it hard for chipmakers to move, forced to focus away from making microchips and, instead, onto the wasteful exercise of appeasing regulators.

Now that they are finally about to get CHIPS funding, Intel and others are delaying announced factories and foundries on U.S. sites and instead going ahead with more overseas plants.

I guess they want to get stuff done.

This is Common Sense. I’m Paul Jacob.


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free trade & free markets regulation too much government

The AB5 Agenda

AB5 is the code name for legislation passed in California a few years ago to kill freelance work. 

Ex-freelancers hate AB5; employers who can’t afford to convert contractors into regular employees hate AB5. 

Unions, on the other hand, love AB5; lawmakers also love AB5.

A California citizen initiative partly reversed it. Then the Ninth Circuit at least temporarily reversed the reversal.

Though Democrats have made several attempts to bring it to the federal level, Congress has not passed a federal version of AB5. But now the Department of Labor is acting to impose a rule to challenge the status of many independent contractors, scheduled to take effect March 11. This AB5-like rule enunciates six criteria determining whether contract work may still be called contract work.

This affects what I do. One of my dozen jobs is citizen-initiative work. Various state governments have done all they can apart from comprehensive AB5-like rules to impede my ability to collaborate with petitioners to get citizen initiatives on the ballot. It is most efficient to pay these contractors per thing they do instead of earning a fixed salary or getting paid an hourly wage. 

Politicians and bureaucrats know this.

If the Labor Department’s new rule takes effect, will contractors working with me pass the test? Or will we all be thrown into chaos and confusion?

It is being challenged in court. 

Many voters — who are, after all, wage-earners or salaried employees — may not care very much; it may seem irrelevant to them. But it is time for them to inquire why some politicians and union bosses want to destroy the ability of freelancers to freely work for outfits short of becoming full-time employees.

For the ramifications will reach far beyond my niche “industry.”

This is Common Sense. I’m Paul Jacob.


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free trade & free markets regulation too much government

SAD Regulators

Americans are getting sicker and fatter on government-approved, corporate-made foodstuffs, yet government continues to crack down on the sale of natural and home-made foods.

The classic case is raw, whole milk. I’ve talked about this before. The most recent case is from Amish country, where the State of Pennsylvania raided a farm “on suspicion of selling ‘illegal milk,’ among other products,” explains The Epoch Times, and the farm “is being sued by the Pennsylvania Office of the Attorney General and Pennsylvania Department of Agriculture.” 

The Amish farm “has been ordered to halt all sales of its dairy products, inspiring widespread anger over what critics have called a blatant example of government overreach.”

At issue is government interference in farmers and customers freely choosing to skip the major grocery outlets multinational companies and dealing with each other on a local, free-market basis. “Capitalist acts between consenting adults,” as Robert Nozick put it.

But it’s especially galling when placed in the wider context of the FDA’s and USDA’s obvious failure to produce a healthier populace. Though the state’s attorney general insists that “we cannot ignore the illnesses and further potential harm posed by [the] distribution of these unregulated products,” the illnesses caused by what many call the Standard America Diet (SAD) go unnoticed and unregistered as such. 

One standard for “the market,” another for the regulators.

Meanwhile, the State of Wisconsin is pushing a new bill to impose a $20,000 annual sales cap on participants in the state’s cottage food industry, “one of the most restrictive in the nation,” explains Suranjan Sen, an attorney at the Institute for Justice — a legal aid outfit often mentioned in these pages.

The very point of the law is to protect brick-and-mortar grocery and baked-goods stores — not the health of consumers. It has the backing of powerful lobbyists.

Looking for healthier foods and healthier economies? Don’t look to government.

This is Common Sense. I’m Paul Jacob.


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free trade & free markets general freedom ideological culture

Milei Defends Capitalism

Capitalism is better than socialism.

The new libertarian president of Argentina, Javier Milei, recently explained the virtues of the free market to attendees of the annual World Economic Forum in Davos, Switzerland.

Milei said that capitalism generates “an explosion of wealth,” that capitalism and the industrial revolution “lifted 90 percent of the world’s population out of poverty,” that a free market society is both practical and just.

“Far from being the cause of our problems, free enterprise capitalism as an economic system is the only tool we have to end hunger, poverty, and destitution across the planet. The empirical evidence is unquestionable.”

As its answer to the practicality and justice of a capitalist social system, the left proposes the injustice of “social justice,” according to which “capitalism is bad because it is individualistic” and “collectivism is good because it is altruistic.”

Collectivism hobbles the entrepreneur and “makes it impossible for him to produce better goods and offer better services at a better price.” Which only impoverishes us. This is neither practical nor moral.

The West is in danger because it is allowing capitalism to be destroyed. We need to remember why we need it.

Will any of the dignitaries who heard Milei’s talk learn its lessons? Maybe not if they’re like WEF’s founder, Klaus Schwab, who looks at the international predations of the Chinese Communist Party and sees a “responsible, responsive” state.

But maybe a few others will. And then a few more.

This is Common Sense. I’m Paul Jacob.


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free trade & free markets general freedom international affairs

Market Rents Work in Argentina

Markets work and markets for housing work.

This is what the new president of Argentina, Javier Milei, has sought to confirm by means of radically free-market economic policies. He is going as far as he can as fast as he can to make Argentina a freer and more prosperous country.

Can he succeed in the long run?

Many exploiters of the socialist status quo ante are bitterly opposed to his reforms and hope to undo them. We’ve seen before how quickly a relatively anticapitalist administration can kill the freedom-expanding reforms of a relatively procapitalist one.

But at least for now, Milei is proving his point, as witness the market for apartments in Buenos Aires.

The Buenos Aires newspaper El Cronista reports (with the help of Google Translate) that with the end of rent controls, the supply of rental units in Buenos Aires has doubled and prices for units have fallen by around 20%. The paper cites data by the Argentine Real Estate Chamber and the reports of brokers.

Under rent control, by 2023 the supply of rentals had shrunk to just 400 units. “Today we have a stock of more than 800 apartments, and it is growing day by day,” says Alejandro Bennazar, a director at the Chamber.

Eight hundred units is still low given the size of the capital city, but there’s light at the end of the tunnel. Getting rid of the controls caused supply to double instantly. An excellent start.

This is Common Sense. I’m Paul Jacob.


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