regulation

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Google Mugged By Reality?

Tuesday, July 22nd, 2014

Google says health care is unhealthy.

Venture capitalist Vinod Khosla has conducted what he calls a “fireside chat” with Google founders Larry Page and Sergey Brin. In one much-cited passage, Brin observes that although he is excited about making gadgets like glucose-measuring contact lenses, health care, because “so heavily regulated,” is “just a painful business to be in. It’s not necessarily how I want to spend my time. . . . [T]he regulatory burden in the U.S. is so high that I think it would dissuade a lot of entrepreneurs.” Page echoes his colleague.

A blunt, and fair, observation. But it makes one wonder why these super-entrepreneurs have not been more critical (at least so far as their search engine can tell me) of Obamacare, which multiplies mandates and prohibitions in the medical industry by an order of magnitude.

Top Google executives are known to be liberal in their politics, and presumably have been sincere. It seems, though, that reality is not cooperating with any ideological tilt they may yet harbor in favor of government paternalism.

It’s in fields with which a businessman is best acquainted that he is most likely to recognize the value of freedom — at least his own, if not always that of competitors. So perhaps we should hope that Brin, Page and other Google principals try to achieve something great in every industry there is. That way, they can come around to consistent, principled support for freeing markets.

This is Common Sense. I’m Paul Jacob.

Let Us Drive

Thursday, July 17th, 2014

How about letting us drive?

Who’s us? Passengers—taxi-ride buyers. Plus anyone else who participates in the market transactions that take us places.

Many Orlando, Florida cabbies are eager to work with the ride-sharing company that makes the smartphone app Uber. They’re tired of leasing cabs for $129 a day while scrambling for enough price-controlled fares to earn a decent living after paying that steep cost. Uber drivers provide their own car and let the firm’s technology connect them to customers. Uber gets 20 percent of fare revenue.

The politics are mostly hostile to the innovation in places like New York City where markets are mangled by super-high license fees and other regulations. The politics are also tough in Orlando, which has been cracking down on Uber drivers. But the mayor and Uber executives have been talking about a deal under which Uber could operate if it submits to . . . regulation. (Sigh.)

Cab companies in the City Beautiful expect to rapidly lose revenue if innovators like Uber and Lyft get to operate freely. But Orlando taxi drivers expect to gain.

“If you talk to 1,000 drivers,” says one, “950 will tell you they are going to Uber.” Says another: “Let Uber come here. It’s going to be good for the customer and the driver.”

Let them come. Also kill all regulations, including fare caps, that make it harder for cab companies to adapt. Let terms of trade be driven—regulated—by traders. Not by governments.

This is Common Sense. I’m Paul Jacob.

Greek Recipe for Disaster

Thursday, July 10th, 2014

Several years ago, Despina Antypa and her husband worked at a leading newspaper in Athens.

Then came the economic crisis.

The bad news was “just a whisper” at first. But when friends began losing work, she had the foresight and discipline to plan a new career. One unrestricted by language or country — just in case they ever had to leave Greece. She chose pastry, taking classes every weekday for two years, practicing techniques on weekends.

Sure enough, in 2011 the couple lost their own jobs. Despina threw herself into the task of confecting a signature delicacy good enough to sell; some 3,000 trials and errors (“mostly errors”) later, she was satisfied.

Then came the work of developing a website, packaging, selling.

Orders poured in. The labors were paying off. Except that—

The business was killed in its crib by bureaucrats.

The Greek government demanded a lot, including

  • advance taxes equal to “50 percent of estimated profit in the first two years” (money never to be returned were the business to fail);
  • minimum square footage for her shop much greater than necessary; and
  • a separate toilet for walk-in customers (although there would be no walk-in customers).

The arbitrary burdens proved too great. In 2013, her husband got a job offer that meant moving to Brussels. They jumped at the chance. There they forged the new life they could have forged in Greece — had they been allowed to.

It seems that the road to recovery is not helped by hobbling the runners.

This is Common Sense. I’m Paul Jacob.

Abridge Too Far

Wednesday, May 7th, 2014

Sick and tired of “too much money” in politics? Worried the average citizen’s voice is being drowned out?

Thirty-six Democratic U.S. Senators have just the thing: a re-write of the First Amendment.

They’ve co-sponsored a proposed amendment to the U.S. Constitution: Senate Joint Resolution 19.

“We would give the power back to the Congress,” says chief sponsor Sen. Tom Udall (D-NM).

Wait. That’s amending reality. Congress never had any such power. The instructions in the Constitution are quite clear: “Congress shall make no law … abridging the freedom of speech, or of the press …”

These 36 solons reverse course with the wording

… Congress shall have power to regulate the raising and spending of money and in-kind equivalents with respect to Federal elections, including through setting limits on —

  1. the amount of contributions to candidates for nomination for election to, or for election to, Federal office; and
  2. the amount of funds that may be spent by, in support of, or in opposition to such candidates.

Our brand new constitution would not contain a single word of restraint. Instead, powerful congressional incumbents would wield complete and total control over all money to be raised or spent by their competitors.

And note: they already enjoy a tremendous name recognition advantage over their challengers. What happens when incumbents limit campaign spending too low for challengers to compete?

Its negation of rights is so sweeping that the amendment actually states, “Nothing in this article shall be construed to grant Congress the power to abridge the freedom of the press.”

No worries for the New York Times, then. But just how much of the First Amendment do the rest of us get to keep?

This is Common Sense. I’m Paul Jacob.

This Is the Government We Pay For

Tuesday, April 15th, 2014

We live in a time when the governing political party and the dominant strain in the major media constantly harp on two themes:

  1. Capitalism is wasteful, not environmentally sound, and
  2. We need more regulation from government.

So, it is especially droll to witness the Food and Drug Administration pounce upon an age-old recycling practice between breweries and farms. In the name of “better regulation,” and “safety,” of course.

For well over a century beer brewers have disposed of their spent grain product — the non-beer product of the beer-making process — by giving or selling it cheaply to farmers, who feed it to livestock.

It would cost a lot to dispose of this in landfills, so brewers save money by letting farmers take the dregs off their hands.

But now the FDA, in a new set of proposed rules (proposed not by Congress, by the way), wants to protect cattle’s food supply by requiring brewers to dry the spent grain before shipping it off.

That’s a killer cost. One Oregonian brewer referred to it as an “enormous burden,” and warned that higher consumer prices would be the result.

I’m with Oregon Senator Ron Wyden (D), who demands that the agency go back to the drawing board.

“I don’t know everything about beer,” Wyden has been quoted, “but I do know when a federal agency acts like it has had one too many.”

For my part, I don’t see this as aberrant behavior from a federal agency. I see it as typical.

Typically drunk on power.

This is Common Sense. I’m Paul Jacob.

Just What We Need

Monday, February 3rd, 2014

Why is schooling so expensive? Government makes it so.

Take the recent example, in California, of “coder boot camps.” These are “schools” where computer coders receive training. We now learn that the Golden State’s education bureaucrats are cracking down on this unlicensed and unregulated form of learning.

Unless they comply, these organizations face imminent closure and a hefty $50,000 fine. These organizations have two weeks to start coming into compliance.

In mid-January, the Bureau for Private Postsecondary Education (BPPE) sent cease and desist letters to Hackbright Academy, Hack Reactor, App Academy, Zipfian Academy, and others.

The regulators insist that these private enterprises fall under their regulatory domain, and they are going to do their job, dangit, even if it helps . . . no one.

Reaction from the coder academy heads has been boilerplate. They’ve attested to their will to co-operate with regulators, but worry that current regulations do not really have much to do with what they are up to.

Hey, regulators, rather than shut these academies down, or cook up new regs, why not just let the operations go on as before?

Worried about quality control in a consumer-protection sense? Then make one requirement: The schools should notify paying students that the academy’s services and education contracts are unregulated by the state. Make do, students, with caveat emptor, as before. That is, by the principles of market supply and demand, and undergirding laws against fraud.

This is Common Sense. I’m Paul Jacob.

Planners Cover Up Waste

Friday, January 3rd, 2014

You know that politicians waste money. You guess that they waste a lot of time.

But did you know they deliberately waste our time?

Transportation scholar Randal O’Toole regales us with the fix that California’s overlords have put themselves in. Merely assuming that dense city living decreases commuting, California’s legislators cooked up a law requiring local governments to increase population density.

But it turns out “transportation models reveal that increased densities actually increase congestion, as measured by ‘level of service,’ which,” O’Toole informs us, “measures traffic as a percent of a roadway’s capacity and which in turn can be used to estimate the hours of delay people suffer.”

So what to do? Golden State’s august solons have exempted cities and municipalities from calculating and disclosing the bad effects of their own legislation. They offer other standards, all of which, O’Toole explains, demonstrate only “that planners and planning enthusiasts in the legislature don’t like the results of their own plans, so they simply want to ignore them.”

The gist of the new standards of “regulation”? “[T]hey ignore the impact on people’s time and lives: if densification reduces per capita vehicle miles traveled by 1 percent, planners will regard it as a victory even if the other 99 percent of travel is slowed by millions of hours per year.”

It’s quite apparent that politicians are willing to sacrifice our time to get what they — not we — want. Time is not money. Time is more important than money.

This is Common Sense. I’m Paul Jacob.