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Officials Responsible for Stadium Subsidies Get Privileged Seats for Free

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Officials Responsible for Stadium Subsidies Get Privileged Seats for Free

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

Freedom is easy to like. All it takes is for us to let it reign. But with crony capitalism being as ingrained in American political culture as it is today, most of the public isn’t aware of the disastrous consequences of the practice.

MinnesotaAccording to Reason magazine, at least six government appointees responsible for securing a great amount of public money for the construction of the Minnesota Vikings’ new football stadium are now getting access to luxury boxes at no cost.

The appointees are members of the Minnesota Sports Facilities Authority (MSFA), an agency created by the state government in 2012 to administer public subsidies granted to the building of the U.S. Bank Stadium. The stadium opened earlier this year with the help of $1.1 billion grant from the taxpayer and now, the six appointees who must have worked quite hard to ensure public money was readily available are able to enjoy all and any events in the stadium for free.

During an investigation by the Minneapolis Star-Tribune, reporters found that, while the Vikings claim that the very existence of these luxury boxes is a marketing move, family and friends of the same MSFA board members responsible for government’s generous grants are often in attendance.

While attempting to explain why they have access to the suites, at least two MSFA members told reporters that since they work “long hours on game days and spent long nights negotiating on behalf of taxpayers during construction of the building,” privileged access to events is “reasonable.” How about that?

Despite their comments, one of these privileged government workers happens to be the son of Walter Mondale, the 42nd Vice President of the United States under President Jimmy Carter, while a second MSFA board member is the daughter of Tom Kelm, the chief of staff for former Minnesota Gov. Wendell Anderson.

As you can see, power players in local and federal politics are often quick to identify. As many of them live their lives being involved in lobbying efforts to ensure special interests are being protected and propped by official entities, they also fatten their own bank account or enrich their lives as a result.

The lesson here is: Incentives always matter.

For this issue to be addressed in a direct and effective matter, those concerned with how their money is spent should always press for reform that removes these incentives from the game altogether. Change will come only when we are able to ensure that neither party is gaining something from government intervention.

Californians Continue to Flee as Public Pensions Eat Up 20 Percent of City Budgets

in Economic Liberty, Economics, Liberator Online, News You Can Use, Taxes by Alice Salles Comments are off

Californians Continue to Flee as Public Pensions Eat Up 20 Percent of City Budgets

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

California has, for a long period in American history, been the go-to place for entrepreneurs and seekers of fortune and fame. But as the regulatory burden grows, making it difficult for business owners to stay, they simply pack and move somewhere where the cost of doing business won’t be as overwhelming.

LuggageThat is a reality and it has been bad for quite some time.

According to CoreLogic’s recent analysis, for every home buyer coming into the Golden State, there are three Californians selling their property and flocking elsewhere.

What the study concluded, deputy chief economist at CoreLogic Sam Khater told reporters, is that the the current state of the California housing market shows that there’s a clear connection “between migration patterns and home prices.”

Since property costs in California have risen 71 percent since 2011, members of the middle and lower classes simply cannot afford to stay so they flee, taking their taxes with them. With local government’s worker pensions growing at a staggering rate — even after reforms were implemented — it isn’t farfetched to believe that, as young, hard-working people leave the state, local governments begin to face tough times, much like what happened in places like Detroit, Michigan.

In a state where the median home price is at $480,000 statewide due to the local and state government’s heavy-handed intervention in the real estate market, incomes aren’t keeping up with the home price increases, making it hard for young families to keep up with their expenses. Instead of opting for paying bills and taxes instead of spending on themselves, people are choosing to leave.

In cities like Los Angeles, taxpayers foot billionaire pension bills, which eventually added up to $1.04 billion in 2015, a sum that represents 20 percent of the city’s general fund. And despite the changes to the laws, city officials will continue to use up to 20 percent of the Los Angeles city budget just to cover pensions and retiree healthcare in the future.

But what about the tech industry? You might ask. Isn’t it making Californians rich?

While the tech industry in is, indeed, thriving, the wealth it creates helps to play into the hands of crony capitalism.

As wealthier tech giants become even more prosperous, they also become more influential among California and Washington politicians. But that’s not all. They also raise the overall cost of living for those around them.

With local governments eating into locals’ paychecks, only those who are powerful enough to influence policy will remain in California. And as history teaches us, this is bound to have a very bad ending.

Hamilton Fans, BEWARE: Anti-Scalpers Bill Will Hurt Concert Goers

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Hamilton Fans, BEWARE: Anti-Scalpers Bill Will Hurt Concert Goers

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

Scalpers are often “greedy,” and widely known for their “malicious” ways, at least that what we constantly hear. But when concert goers forget to buy tickets to their favorite band’s concert, the reliable scalper is their best friend. So what’s up with monopolies such as Live Nation Entertainment attempting to put an end to scalping “bots?”

HamiltonAs any major corporation would do, Live Nation spent no time attempting to develop a system that would keep said “bots,” or rather the scout bot software, from purchasing tickets en masse and reselling them online. Instead, the company decided to lobby the government for “help.” As a result, Senators Jerry Moran (R-KS) and Chuck Schumer (D-NY) introduced the BOTS Act in order to offer “equitable consumer access to tickets.”

In order to pressure the Senate to pass the bill, legislators are even using personal testimonies from fans who lost the opportunity to purchase cheap tickets to “Hamilton.”

But according to technology policy fellow at the R Street Institute, Anne Hobson and senior research fellow at the Mercatus Center at George Mason University Christopher Koopman, the legislation does not pass the smell test. Simply because the bill would not benefit fans as it promises.

What senators may call a solution, experts call a “solution in search of a problem.”

According to Koopman and Hobson, the problem is not a problem at all. Take Live Nation, for instance. The company’s Ticketmaster service sold over 147 million tickets in 2012. Even if bots acquired about 100,000 tickets a year, which hasn’t been proven since there isn’t enough data to support this claim, “that would still be significantly less than 1 percent of all tickets sold,” experts contend.

The company vows that 60 percent of its most desirable tickets are purchased by bots, but choose to ignore the fact that the company loses tickets by not selling them to the public directly.

By using a system such as Ticketmaster, Live Nation opens itself up to this type of issue.

On top of this problem, proponents of the BOTS Act ignore that by barring scalpers from operating the way they do today would help to push the price of tickets up, not down. Thus hurting the consumer.

By limiting the public’s access to tickets with the use of Ticketmaster, companies like Live Nation also help the cost of concert tickets to be artificially high by preselling or putting the majority of tickets on hold for artists and managers.

With artists and managers reselling these tickets to the highest bidders, they are also competing with scalpers. With that in mind, it’s easy to see why the industry is so concerned with this matter, willing to lobby Congress to act on it in such a dramatic fashion.

But if the goal is to create an “equitable consumer access to tickets,” government must step away from this fight.

But since my hint is that the goal is to just ensure the entertainment industry is protected from those “greedy” scalpers, I’m sure few in Congress will act with the consumer in mind.

Small CA City Employees Living Large, Making More Than Governors

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Small CA City Employees Living Large, Making More Than Governors

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

Governments lack knowledge. And it’s what that axiom in mind that we can safely say that acting without knowledge is, even in the short run, a waste.

SantaMonicaIn the city of Santa Monica, California, local bureaucrats are making more than $300,000 a year. That’s $187,000 more than current Vice President elect Mike Pence made as Governor of Indiana the past year.

According to a local investigation, at least 105 Santa Monica employees make more than $300,000 a year, including Santa Monica Police Chief Jacqueline Brooks, who makes $480,000 a year while public records show her base salary is at $306,000.

Overseeing 200 officers, Chief Brooks’ salary seems a bit unusual, especially when you compare it with next door’s Los Angeles Police Chief Charlie Beck, who makes $344,000 while overseeing more than 9,000 officers.

Still in Santa Monica, an unnamed police sergeant raked in nearly $500,000 last year while his base pay was only $137,000. With overtime alone, he was paid about $179,000 extra but unused sick and vacation time were also added to the total, bringing the sergeant’s pay to the total of $475,000.

Others in the local force such as lieutenants, other sergeants, fire captains, and even a marshal made up to six figures by working overtime. According to the Santa Monica city manager, the high number of city employees working overtime is due to the fact that several positions are still unfilled. Currently, however, 18 new firefighters are training in the local academy. Other 18 positions are still waiting to be filled within the local Police Department.

As local transparency groups ask officials why they are having such a hard time filling positions while offering such good pay rates, they want more answers. And if public pressure grows, they may even be able to push for an audit.

As the taxpayer is forced to foot the bill, these watchdogs want city officials to be able to explain in detail why so many of its employees are making more than governors and, sometimes, even as much as the president.

Currently, Santa Monica has some of the highest taxes in the region. With the imminent increase in sales taxes projected to pass by popular vote, they will become even higher.

In other local cities such as Long Beach, watchdogs found 13 city employees making more than $300,000. The same number of overpaid employees was found in Newport Beach, but both cities have populations that are about five times that of Santa Monica.

While the figures are exorbitant, the real problem in this case is not only that government officials are clueless about what the labor market looks from outside of their offices. The bottom line is: When the money doesn’t come out of your own pocket, you do not have to be careful about how you spend it.

Seeing taxpayers as a bottomless pit of money, governments have enough incentives to keep on spending without being held accountable for how they are spending this money. In a free market where the price system is in place, the cost of labor is varied and competitive. Without the pricing mechanism, service providers are not aware of the demand, making them incapable of determining real value.

The only solution to this problem is to shrink the government. Even local ones.

Yes, Corruption Cripples the Economy

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Yes, Corruption Cripples the Economy

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When analyzing the potential ramifications of picking one presidential candidate over the other, many prefer to overlook claims of corruption. On one hand, voters might not be exactly aware of what corruption may entail, but on the other, they might not be entirely sure of how corruption taking place in high levels of government will ever impact their personal finances. Unfortunately for those who do not seem to understand how corruption affects them, the consequences of rent-seeking and influence-peddling schemes go deeper than we expect.

corruptionIn Protectionism vs. Corruption: Which Is Worse for the Economy?, economist D.W. MacKenzie writes that while “an overwhelming majority of economists have agreed on the benefits of free trade since 1817,” many contemporary politicians believe that some trading restrictions help boost the U.S. economy.

But when it comes to analyzing the impact of corruption, few seem to take into consideration that political corruption “impairs economic efficiency and lowers living standards.”

Traditionally, corruption has always been treated as a legal affair, which might explain why the population’s attention is steered away from the real-world consequences of the practice.

According to MacKenzie, the problem with widespread corruption is that special interest groups take advantage of it, lobbying government elements directly to provide them with special treatment, therefore transferring wealth “from the general population into their pockets.” When analyzed closely, these special relationships between private industries and the government “make us all worse off” because the resources used to ensure these groups’ needs are being met could have been spared. In other words, taxpayer money spent on what many call corporate welfare could have stayed in the consumer’s pockets and then used for other purposes, getting that amount back into the economy and helping to make it grow.

Another aspect of political corruption that is often ignored is that free trade is the necessary condition for economic growth to occur, but in countries where markets thrive, their governments are often less impacted by corruption. Considering political corruption is inefficient and bad for growth, MacKenzie concludes, giving more power to politicians known for being corrupt will further damage the economy.

As voters cast their ballots for president, they must have in mind that the only policy that will bring economic growth and peace to America is the complete elimination of barriers to commerce, getting the government completely out of the business of picking winners. Unless the link between the government and the rent seeker is severed, there will be no room left for prosperity.

ACA’s Medicaid Expansion: Not Good for Your Health

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ACA’s Medicaid Expansion: Not Good for Your Health

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

In 2010, just a few weeks before Congress passed the Affordable Care Act, President Barack Obama said that taxpayers “end up subsidizing the uninsured when they’re forced to go to the emergency room for care…. You can’t get … savings if those people are still going to the emergency room.”

healthcarePart of what the current administration’s signature health law was supposed to do was to increase cost savings so visits to the ER weren’t as common. After helping to pass the law, then-Speaker of the House of Representatives Nancy Pelosi claimed that “the uninsured will get coverage [so they are] no longer [being] left to the emergency room for medical care.”

Six years have passed since those who supported ACA and its main provisions promised to bring the number of ER visits down and yet, a study published in the New England Journal of Medicine shows that assuming ACA would lower the number of ER visits was a mistake.

With the expansion of Medicaid in states like Oregon, ER visits increased. But the increase is not the only consequence of Medicaid expansion. When compared to 2015, this year’s Medicaid expansion spending is 49 percent higher per enrollee than what government had expected.

In order to expand Medicaid in Oregon, officials used lottery to expand Medicaid benefits to a limited number of lower income, non-disabled adults.

According to the study’s authors, “Medicaid’s value to recipients is lower than the government’s costs of the program, and usually substantially below,” perhaps because, researchers found, expanded Medicaid coverage “resulted in significantly more outpatient visits, hospitalizations, prescription medications, and emergency department visits.”

When it comes to how Medicaid expansion pushed individuals to the ER, researchers explain that, during the past 15 months, Medicaid increased ER visits by 40 percent.

Researchers found that even if patients have Medicaid, there’s “no evidence that Medicaid coverage makes use of the physician’s office and use of ERs substitutes for one another.”

What many choose to forget is that Medicaid expansion was made possible because of ACA. And according to the government’s own projections, each Medicaid enrollee cost the taxpayer roughly $6.366 in 2015, 49 percent higher than past predictions. This cost spike is mostly due to the fact the federal government reimburses 100 percent of state spending on enrollees who were added after the expansion was launched.

When ACA became law, states were given enough incentives to pay insurance companies high payment rates so new enrollees were cared for, but the high payment rates could only be covered by the federal taxpayer. Since many physicians are leaving the system altogether, preferring to not accept new Medicaid enrollees due to lower rates, patients continued to use ER at a high rate, even higher than years past. So coverage, in this case specifically, did nothing to help patients in need. The result is higher cost to the taxpayer. Instead of making people healthier and helping individuals who are unable to afford medical care, researchers found that the result has been the exact opposite, invalidating ACA apologists.

Will they continue to ignore these results?

Goldman Sachs’ CEO: Regulations Help Us Grow, Keeping Competitors at Bay

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Goldman Sachs’ CEO: Regulations Help Us Grow, Keeping Competitors at Bay

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

Crony capitalism continues to expand big government’s grip, extending the realm under government’s control in ways we once thought impossible. As businesses and employees hurt due to government’s increasing control over all business fields, so does the economy.

GoldmanWhile this issue is inherently a government problem, big business has a lot to do with the growing regulatory burden. Instead of downplaying their role, libertarians should be pointing out how both parties are to blame, and how even big businesses understand this reality and often use it to their advantage.

In a 2015 interview, Goldman Sachs’ CEO Lloyd Blankfein explained how regulations help to protect large, established firms, keeping smaller competitors from having access to the market.

In his own words, he gave the reporter an outline of what happens when a large firm like his is afraid of its competitors, and what’s funny is that few news outlets caught on to the CEO’s unabashed honesty, choosing to never reproduce his comments or downplay their importance.

When talking about how upstart tech companies and the threat they pose to Goldman, Blankfein said that while “all industries are being disrupted to some extent by new entrants coming in from technology,” regulations have been a friend of Goldman mostly because “there are some parts of [Goldman] business, where it’s very hard for outside entrants to come in, disrupt our business, simply because we’re so regulated.”

The burden of regulation, Blankfein added, is a serious issue for “people in our industry,” but, “in some cases,” Blankfein continued, “the burdensome regulation acts as a bit of a moat around our business.”

As you can see, Goldman Sachs’ own CEO refers to regulations as moats. In other words, the regulatory burden can be heavy and Goldman executives agree, but as long as the rules keep competitors from getting anywhere near the Goldman castle, the company doesn’t see a problem with complying.

According to Bill Anderson, a professor of economics at Frostburg State University in Frostburg, Maryland, America truly embraced regulations during the Progressive era, following the lead of progressive leaders such as Theodore Roosevelt, William Jennings Bryan, and Woodrow Wilson who believed that “the federal system of delegated powers was archaic and out of date for a ‘modern, progressive’ society.”

To these politicians, stripping “powers from state and local governments and transferring them to Washington, DC” and “convincing members of Congress to give up their own constitutionally-designated powers” were essential steps in making America a truly progressive nation. How did they manage to go about putting their plan in practice? By “crafting of regulatory agencies,” all of which are part of the executive branch.

So next time you see a Bernie Sanders or Hillary Clinton supporter go on and on about how government and big business should not be involved in any way, remind them of what has enabled this cozy relationship.

Arizona Business Pushing for More Prohibition Gets a Taste of Free Market Consequences

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Arizona Business Pushing for More Prohibition Gets a Taste of Free Market Consequences

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In The Economics of Prohibition, Austrian economist Mark Thorton explains that the “search for privilege and personal gain through the political process” embraced by major corporations and their lobbying minions are responsible for “any net losses to society produced by government policies.” Adding that, throughout history, we are able to see countless examples of prohibitionist policies being enacted due to this marriage of convenience.

boycottAs information is more readily available due to the widespread growth of the Internet, we now live in an era in which people are often made aware of how companies use their political influence to push for certain policies.

In Phoenix, a company whose political activities have been associated with marijuana prohibition is getting a taste of how the free market deals with unwanted subjects.

According to The Phoenix New Times, a Discount Tire Company is facing a growing boycott movement after its billionaire owner made a $1 million donation to help defeat the ballot initiative crafted with the goal of legalizing marijuana in the Grand Canyon state.

The boycott was first launched by local immigrant-rights groups following the company’s decision to hang a “Re-Elect Sheriff Joe Arpaio” sign in their windows. More recently, however, the company donated money to defeat marijuana legalization in the state, and the boycott movement grew.

The reaction did not come as a surprise, considering that the pro-legalization sentiment in Arizona is growing strong.

Prop 205, the initiative Discount Tires has invested money against, would legalize the use of cannabis for adults who are 21 or older. Individuals would be allowed to possess up to an ounce of the product. If Prop 205 wins, weed sales would also be legalized, and individuals would be allowed to grow the plant for personal use.

Possession of more than an ounce up to 2.5 ounces would be considered a non-arrestable civil offense. Nevertheless, the individual caught with more than one ounce of weed would have to pay a fine.

Despite the restrictions proposed by Prop 205, the law would help locals, offering a solution to an aspect of the drug war that continues to put countless of non-violent young men and women in jail.

In addition to Discount Tires’ donation, other groups have invested heavily in the campaign against the pro-marijuana legalization initiative.

Some of the groups behind the effort include the Arizona Chamber of Commerce, Insys Therapeutics, a synthetic THC-maker, Larry Van Tuyl, whose family’s string of car dealerships was sold to Warren Buffett in 2014, Bennett Dorrance, a local resident who’s the heir to the Campbell Soup fortune, Tucson real estate mogul Donald R. Diamond, Foster Friess of Wyoming, who’s known as a “Republican mega-donor,” Empire Southwest LLC, which sells, rents, and services machinery and power generation equipment to contractors, and the Arizona Republican Party.

As long as the boycotts are peaceful, the effort is a perfect example of how free individuals are able to show their preferences in a freer market setting, letting service providers know where they stand and thus, forcing company owners to cater to their clientele in a way they deem acceptable if they are willing to survive their competition.

SHOCKER: Prison Food Makers Don’t Want Arizona to Legalize Pot

in Drugs, Economic Liberty, Liberator Online, News You Can Use, Personal Liberty by Alice Salles Comments are off

SHOCKER: Prison Food Makers Don’t Want Arizona to Legalize Pot

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

Rent-seeking, better known as the practice many companies embrace while trying to obtain benefits through the political machine, is, more often than not, the reason why our liberties are clipped, one by one, in the name of the greater good.

The war on drugs is the perfect example of this.

WeedEver since the idea of the drug war was first considered a valuable policy, politicians have used it as a way to bring their own enemies to heel. Much like major companies — whose profits suffer greatly whenever new competitors enter the market — these politicians often exploit their titles while claiming to hold an entirely different position in public.

With the war against marijuana, we have seen countless industries such as the tobacco and pharmaceutical industries step up their efforts to ensure the plant remains criminalized. As some begin to embrace the trend — even adding marijuana to their portfolio — others remain stubborn, fighting against the change and pushing Washington insiders to keep weed as a Schedule I substance.

Still, there’s one particular industry fighting marijuana legalization that, up until recently, had not made it to the news.

While the law enforcement and prison sectors have always been anti-drug legalization — with the exceptions of groups such as Law Enforcement Against Prohibition (LEAP) — yet another prison-related company has been investing in keeping weed illegal in at least one state: The prison food industry.

According to official Arizona state reports, Services Group of America has donated $80,000 last month to a campaign committee that hopes to defeat the legal cannabis measure on this year’s November ballot.

SGA’s subsidiary, Food Services of America, is tasked with preparing meals for correction facilities. And, in the past, it has been accused of offering meals that fail to meet basic nutritional standards set by the government. They do not seem too keen on allowing prison demands for their food reach a new low.

Local news reports also add that other groups such as the state Chamber of Commerce in Arizona have also donated heavily to the anti-marijuana effort, addressing a $498,000 check to the campaign.

Before both groups offered their financial support, opioid maker Insys Therapeutics had gone further, donating $500,000 to the anti-pot campaign.

Other groups listed as major anti-weed donors include the Arizona Wine and Spirits Wholesale Association, and SAM Action, which is often described as the campaign arm of Smart Approaches to Marijuana.

Despite the heavy-handed efforts coming from these companies to defeat the marijuana legalization efforts, polls show voters are supporting the effort to legalize pot in the Grand Canyon state.

Will rent seekers win this time?

Pharmaceutical Industry Terrified Weed Legalization Will Put Them Out of Business

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Pharmaceutical Industry Terrified Weed Legalization Will Put Them Out of Business

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

The opioid epidemic is a real issue in America. So much so that the U.S. Attorney General Loretta Lynch started telling young folks that marijuana isn’t really the problem. Instead, Lynch explained, legally prescribed medications are to blame for the increase in opioid abuse.

But while learning that the head of the United States Department of Justice has just argued that weed does not represent a real threat may sound promising, it’s important to remember that marijuana is still a Schedule I drug. Meaning that the federal government still sees marijuana as a substance “with no currently accepted medical use and a high potential for abuse.”

ManufacturingRecently, a group of marijuana legalization activists got an initiative known as Proposition 205 in the ballot in Arizona.

The initiative would allow Arizona residents who are older than 21 to possess up to an ounce of marijuana in public. Prop 205 would also allow consumers to grow up to six plants at home, giving them the option to give other adults up to an ounce at a time of its produce “without remuneration.”

But with the good news came another discovery.

The group that, alone, donated $500,000 to the effort to oppose the Arizona marijuana legalization campaign, is a local pharmaceutical company known as Insys, and it produces oral sprays used in the delivery of an opioid painkiller known as fentanyl.

According to Reason, the same company is planning on marketing yet another device that would deliver dronabinol, a synthetic version of tetrahydrocannabinol, or THC: The main mind-altering ingredient in cannabis.

When donating to kill the initiative, the company contended that its opposition to marijuana legalization is due to Prop 205’s “[failure] to to protect the safety of Arizona’s citizens, and particularly its children.” According to Reason’s Jacob Sullum, what Insys is truly worried about is “the impact that legalization might have on its bottom line, since marijuana could compete with its products.”

And why is Insys so concerned? Perhaps because a recent study published in the American Journal of Public Health contends that, in states where marijuana use is legal to a certain extent, fatally injured drivers are “less likely to test positive for opioids.” Sullum adds that this finding, along with the results of other studies show that “making marijuana legally available to patients saves lives by reducing their consumption of more dangerous medications.”

The data analyzed by researchers comes from the Fatality Analysis Reporting System (FARS). By looking at the data gathered from 18 states where 80 percent of drivers who died in auto crashes were drug-tested, researchers found that, between 1999 and 2013, drivers between the ages of 21 and 40 were half as likely to test positive for opioids where medical marijuana laws had been implemented.

In these same states, researchers found that painkiller prescriptions fell by 3,645 daily doses per physician. Researchers concluded that “the passage of the medical marijuana laws” are directly associated with “the observed shifts in prescribing patterns.”

As the industry begins to fear the consequences of ending the drug war, we begin to understand that their dominance over the market is mainly due to their rent-seeking practices, which keep their leaders close to lawmakers, helping the industry to exert enough influence to sway public policy in a way that benefits them.

Without the presence of a government body giving companies special protections while outlawing particular drug transactions, drug providers are able to compete freely and in the open, giving consumers better and safer options.

It’s time to finally put an end to the drug war and admit that, rent-seeking will never help the nation heal from all of the negative consequences of our country’s ongoing romance with crony capitalism.

How Egg Regulations Hurt the Environment — And Your Pocket!

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How Egg Regulations Hurt the Environment — And Your Pocket!

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

Government has a way of making us all question our sanity. Especially when it comes to food regulations and its environmentally unsound consequences.

In many countries across the globe, the practice of washing eggs is seen as anti-hygienic. Because when egg producers wash fresh eggs, they also remove a layer of protein known as cuticle.

EggsThe cuticle is important because it prevents the egg shell from being porous. With a porous exterior, eggs are vulnerable to bacteria.

In the 1970s, regulators with the U.S. Department of Agriculture concluded that egg producers should invest in “fancy machines,” as NPR puts it, to shampoo eggs with soap and hot water. But once the eggs were washed, regulators added, producers should place them immediately in a refrigerator.

To justify the addition of yet another requirement for the egg industry, regulators claimed this step helped to avoid salmonella contamination. But washing the egg’s exterior does little to prevent contamination.

As NPR explains, the cuticle “is like a little safety vest for the egg, keeping water and oxygen in and bad bacteria out. Washing can damage that layer and ‘increase the chances for bacterial invasion’ into pores or hairline cracks in the shell, according to Yi Chen, a food scientist at Purdue University.”

Salmonella enteritidis often infects a chicken’s ovaries, which tends to impact the yolk before the shell hardens. The bacteria can be killed when consumers cook it. Washing the exterior of the egg does little to prevent contamination. As expected, salmonella continues to expose about 142,000 individuals to infections each year.

While many contend that washing the egg and refrigerating it or leaving the cuticle both work, only the method adopted by the United States government requires a great deal of electricity use to ensure the product’s safety. Considering only 10 percent of the total U.S. energy consumption comes from renewable sources, it’s hard to see why environmentalists are not urging government to nix this particular regulation.

But too much energy consumption is not the only negative consequence of egg-washing. The cost of purchasing an egg washing machine, the device’s maintenance, required labor, and the cost of electricity employed in maintaining the product shielded from contamination all add up, increasing the price of eggs and harming the consumer.

With reports showing just how salmonella is still a problem despite the regulatory requirements imposed on the egg industry, it’s hard to contend forcing all producers to wash their eggs is somehow productive. Especially when so much electricity is required to maintain the eggs refrigerated.

Why not try freedom for a change?

Drug Prices Are High Because Government Protects Monopolies

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Drug Prices Are High Because Government Protects Monopolies

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

Ever since the EpiPen scandal hit the public like a ton of bricks, many outlets contended that greed, not cronyism, was to blame.

pillsBut when looked closely, EpiPen is just another example of corporate influence and lobbying shaping public policy. The ones who benefit are always the same individuals who pressed for changes in the first place.

In an article for the Fiscal Times, Mercatus Center’s Marc Joffe contended that the drug price problem could be fixed by targeting the Food and Drug Administration. But not by giving the agency more regulatory power. Instead, Joffe argues that, stripping the agency of its power would do America a world of good.

In the article, Joffe tells the story of how the FDA obtained its power, noting that it was a morning sickness pill that prompted the nationwide support for the Kefauver Harris Amendment, which “gave the [FDA] most of the power it now exerts in regulating drugs.”

As the FDA expanded its power, regulating every single piece of medication in America, drug prices increased considerably, while access to many life-saving drugs remains restricted. To Joffe, the “drug crisis” we now face as a nation has everything to do with the empowerment of the FDA, prompting the scholar to urge lawmakers to look at the free market for a solution if what they are truly after is to lower drug prices.

In a competitive market, Joffe writes, “price equals the marginal cost of production.” But even in an imperfect world, he contends that, when “prices [are] well above production costs,” firms see an incentive to compete. But if markets are restricted and companies are granted exclusive rights to produce and sell certain drugs, firms are unable to compete. Without competition, monopolies set the rules, making way to high costs and low effectiveness.

In his article, Joffe argues that, if Congress is serious about helping patients from all walks of life, they must stop considering the idea of passing laws to expedite the FDA’s approvals for new drugs. Instead, Joffe writes, “[allowing] multiple organizations to approve drugs, providing competition to the FDA … [or allowing] pharmaceutical companies sell whichever medications they believe to be safe and effective — with the understanding that patients can win large judgments if the companies fail to produce and market their treatments responsibly,” would both be better options that would deliver better, and more effective results.

Freedom, after all, is the answer to most of our problems. And that’s why governments often contend the opposite.

How Regulations Helped to Kill the Blackcurrant Berry Market in America

in Business and Economy, Economic Liberty, Liberator Online, News You Can Use by Alice Salles Comments are off

How Regulations Helped to Kill the Blackcurrant Berry Market in America

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

It’s no secret that regulations are used as tools by rent-seeking firms in order to keep competitors off the market. But when US regulations restrict the production of items for long periods of time and for no apparent reason, it’s often hard to bring the same items back into particular communities.

FruitThis happened with the blackcurrant berry, which has impacted Skittles, the fruit-flavored sweets that are both produced and marketed by the Wrigley Company.

In the United States, the purple Skittle tastes like grape. But anywhere else, including the United Kingdom and Australia, the company uses blackcurrant to produce these pesky purple pieces of candy. Outside of the country, everyone knows what blackcurrant is. But in America, many haven’t even heard of the powerful fruit.

What many also don’t know is that blackcurrant berry is not widely known in America because of a regulatory black hole.

For many years, growing the sweet and tart berry in the United States was outlawed. Since the early 1990s, farmers were forced to drop the production, but it wasn’t because there wasn’t a demand. Instead, the policy was embraced after legislators learned that the berry bushes could act as a vector for white pine blister rust, which could destroy the wood. That was a problem for lumber producers, and the berry was outlawed.

While in the 1960s the federal government loosened restrictions, allowing states to set their own rules, a few have kept the ban in place. Nevertheless, most states now allow farmers to grow the berry. Regardless of the policy change, the decades of obscurity made Americans remain unaware of the very existence of blackcurrant berry. The fruit, which is widely popular in Europe, is seldom found anywhere in the United States.

One man’s journey to formally decriminalize the fruit in New York started in Germany, where he ran a restaurant in the Bavaria region. Coming back to New York, Greg Quinn lobbied local lawmakers, helping overturn the ban on growing the fruit. Ever since 2003, Quinn has been growing blackcurrants in Hudson Valley, and now counts with at least 10,000 bushes in his backyard.

Ever since the very first moment he learned about the berry, he knew he alone had to help reintroduce the flavor back to the American palate.

As his brand of juices and concentrates start to slowly hit the market, many cocktail bars and restaurants appear to like the products, but the flavor is so foreign to Americans that the product is often seen as a tough sell.

Until blackcurrant berries are popular in America again, one can only hope that this story will help others to think twice before supporting more restrictions in the future.

Former Felons Could Benefit from Free Markets Too

in Business and Economy, Criminal Justice, Economic Liberty, Liberator Online, News You Can Use, Personal Liberty by Alice Salles Comments are off

Former Inmates Could Benefit from Free Markets Too

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

For too many former convicts, life after prison is hard. Oftentimes, quite impossible. That’s why most of those who are given a second chance end up going back to jail.

But to this 35-year-old, his second chance came in the form of a local restaurant manager who was not scared of government’s formal tagging of felons.

Applebee'sAfter his release in 2011, Marcellus Benbow was struggling to find a job. He told reporters that, at the time, he was doing odd jobs, hoping to avoid going back to a life of crime while looking for a full-time opportunity. As he struggled to find a steady occupation in order to gain custody of his two oldest daughters, he also found no sympathy from potential employers.

That all changed when he answered an ad on Craigslist.

As soon as he met with the general manager at Apple-Metro, the New York franchisee of Applebee’s, both men hit off. That was it. Benbow had finally scored full-time employment with the company as a broiler cook.

“Applebee’s saved my life,” he said.

Now, Benbow is an assistant kitchen manager at Applebee’s Fordham Road location in the Bronx. He could soon be getting a promotion, taking the role of kitchen manager. He was lucky that his current employer was not afraid of his past, but many in his position aren’t as lucky.

In America, felons are required to disclose whether they have spent time in jail. But even if they don’t disclose this information, background checks help potential employers learn more. In many cases, non-violent felons are seen as a threat by employers who prefer to hire someone else, spurring a wave of discrimination suits against business owners.

The result is quite concerning.

The estimated unemployment rates among ex-prisoners are between 25 and 40 percent, despite the federal incentives some get by hiring felons. But laws that have helped to create so many non-violent criminals are still in effect. Instead of urging Congress to review some of these laws, namely the drug war and other pieces of legislation such as the Violence Against Women Act, many advocates for equal employment opportunities blame companies alone for their refusal to hire felons.

Recently, the often feared tycoons known as the Koch brothers announced they would stop asking potential employees about their criminal record. According to Koch Industries’ general counsel, Mark Holden, and Charles Koch, the decision came about after leadership noticed that overcriminalization had been affecting “us all but most profoundly harms our disadvantaged citizens.”

At the time of the announcement, both men penned an op-ed that asked the question: “If ex-offenders can’t get a job, education or housing, how can we possibly expect them to have a productive life?”

Instead of forcing employers to change, advocates could see a real change in the country’s employment environment by just pushing Washington to focus on real criminal justice reform.

BREED LOVE: What the Country’s First Female Self-Made Millionaire Taught Us About Free Markets

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BREED LOVE: What the Country’s First Female Self-Made Millionaire Taught Us About Free Markets

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“Don’t sit down and wait for the opportunities to come. Get up and make them!” Sarah Breedlove Walker

Sarah Breedlove, also known as Madam C. J. Walker, had a tough but incredibly fulfilling life.

WalkerThe African American entrepreneur, philanthropist, and political activist became one of the wealthiest black women in the country by launching Madame C.J. Walker Manufacturing, a company created to meet her communities’ cosmetic needs.

Born to enslaved parents in 1867, Breedlove was the first child in her family to be born as a free woman. As a young woman, Breedlove went through severe financial hardships, but once she moved to Saint Louis, Missouri, she became aware of some of the health difficulties people in her community suffered.

Some of the issues Breedlove saw other black women experiencing included severe dandruff and other scalp ailments associated with skin disorders caused by the lye added to the soap of the era, as well as other socio-economic factors.

Seeing so many women like her suffer from these ailments prompted her to act.

Once Breedlove saw a demand for better cosmetic products designed for different types of skin, she first sought more information on hair care with her brothers, who were barbers. In no time, she became a commission saleswoman for Annie Turnbo Malone, the owner of the Poro Company.

As the time passed, Breedlove used what she learned from her work along with the knowledge she had gathered as a result of her own research, developing her product line.

In 1905, Breedlove moved to Colorado where she and her daughter launched their business. The door-to-door saleswoman would teach other young black women how to style and care for their hair locally until 1910, when Breedlove established her business in Indianapolis, training other women to use “The Walker System,” her own method of grooming that promoted hair growth and scalp conditioning.

For about a decade, Breedlove employed several thousands of black women as sales agents. By 1917, Madame C.J. Walker Manufacturing had employed nearly 20,000 women.

Breedlove took pride in her system, but she also wanted to see others like her flourish.

Instead of just training employees, Breedlove started teaching others about finances and entrepreneurship, empowering an entire generation of black women through the establishment of the National Beauty Culturists and Benevolent Association of Madam C. J. Walker Agents.

During the National Negro Business League (NNBL) annual meeting in 1912, Breedlove celebrated her individuality and self-empowerment by stating:

“I am a woman who came for the cotton fields of the South. From there I was promoted to the washtub. From there, I was promoted to the cook kitchen. And from there, I promoted myself into the business of manufacturing hair goods and preparations. I have built my own factory on my own ground.”

Breedlove was special because she never complained. Instead, she looked around and saw an issue that she could solve. Through markets, she learned to compete by offering a product that met the demands of people in her community. As she grew as a businesswoman, she also gave back, teaching others that hard work and dedication pay off in the end.

Sarah Breedlove Walker may have not always seen her own story as an example of how markets help empower the individual. But this generation of young women could learn a great deal from her. Not just because of her defiance in the face of difficulties, but also because of her vision. Instead of simply demanding attention to her cause, Breedlove made her mark in the world by helping others (while helping herself).

As the F. A. Hayek character says in The Fight of the Century: “Give us a chance so we can discover/The most valuable ways to serve one another.”

Taiwan Streets: a Case of Free Markets in Action

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Taiwan Streets: a Case of Free Markets in Action

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In Liberalism: In the Classical Tradition, Ludwig von Mises explains that classical liberalism “was the first political movement that aimed at promoting the welfare of all, not that of special groups.”

TaiwanIn an article for the Foundation for Economic Education, Professor Peter St. Onge, a long-time Taiwan resident, discusses a real world example of free markets working to promote the welfare of all members of a community.

In “Taiwan’s Social Safety Net Is the Street Market,” St. Onge reviews some of the most striking traits of the streets of Taiwan and the state’s loose regulations, giving us a better idea of what Mises wrote nearly 90 years ago.

According to Onge, libertarians and free market apologists are “often ridiculed” when they claim that free enterprise is the best substitute for the welfare state. They are often called naïve for suggesting that fully capable individuals would have a better shot at making a living if they were given freedom instead of government dependence.

In Taiwan, Onge writes, the welfare state is “tiny,” and the regulations aren’t as restrictive when compared to the United States or Europe. The few regulations the state has in place are also lightly enforced.

With the gaps created by government’s hands-off approach in the island of Taiwan, commerce exploded. The result? “Near-zero homelessness.”

The obvious effect of less restrictive regulations is the growth of business, which makes local streets bright with store signs, consumers, and shop keepers. But brick-and-mortar stores are not the only ones benefiting from this freedom. According to Onge, the island hosts a number of pop-up businesses that take over the streets, employing “mainly low-skill labor.” These businesses give the poor and the unskilled the chances that the state’s handouts can’t.

To illustrate his point, Onge writes that, every morning at 5 am, farmers bring their produce to a street close to the university where he works. Using folding tables, they place their products along the street undisturbed. As the diverse sets of customers arrive, the street is filled with color and sound. Some of the customers include the elderly, who aren’t healthy enough to drive to a large store, mothers with small children, and fathers getting ready to cook breakfast. At 7 am, farmers pack up and leave the spots, opening up the space to breakfast pop-ups like noodle shops, sandwich places, and joints offering full English breakfast.

Past noon, these spaces are freed again, giving the night crew time to set up different types of restaurants and stores.

At night, Onge reports, you can buy anything in that street. From fried chicken to kids’ toys. Customers can be seen enjoying the creative madness until 3 in the morning. Just a couple of hours before farmers are ready to unload their produce once again.

This “small river of entrepreneurial income” helps low-skilled workers find jobs, even if temporarily, while also bringing consumers what they want, conveniently.

Instead of crony capitalism, these streets are filled with old-fashioned free markets, allowing competitive enterprise to shape commerce, not government-backed favoritism.

The result is happier customers, more jobs, more safety, and cheaper products.

Adding a Private Element to Public Schooling Boosts Diversity

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Adding a Private Element to Public Schooling Boosts Diversity

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

During the 2016 Amplify School Choice event promoted and organized by the nonprofit news organization Franklin Center, bloggers and journalists from across the country had the opportunity to visit two public schools in the Denver, Colorado area.

While the event brought several options of schooling to light, one of the programs most speakers focused on is known as a charter.

StudentsCharter schools are public schools. What makes them uniquely different from traditional schools is that they share a private element with for-profit organizations.

Instead of being run like a public school, charters are given the freedom to refrain from following regulations imposed on traditional schools, allowing leadership to resort to different educational methods. Charters usually hire teachers who are not unionized and often use unique educational techniques, giving students with special needs an opportunity to adapt.

But because these schools are publicly funded, students who would otherwise be stuck in the neighborhood’s traditional school are given the opportunity to choose.

Charters, which are often smaller, are able to work with students in a more direct way than traditional school teachers can. And low-income families with access to the charter option are often thankful in the long run.

During a conversation with Bill Kurtz, the CEO of DSST Public Schools—a local charter—we were lucky to get to know three DSST students, all who happened to be the children of immigrants.

According to Kurtz, the idea behind DSST is to boost the community. “As you can see,” he told the audience of bloggers and journalists, “the school is very diverse. [It] largely mirrors the population of Denver.”

With a 100 percent success rate in sending students to college, DSST stands out for the diversity of its students and its success rate in following its mission. But during the conversation, Kurtz didn’t go into the economic or praxeological reasons why his school excels in bringing diverse people together.

In the book The Liberal Archipelago: A Theory Of Diversity And Freedom, author Chandran Kukathas contends that the state has no place promoting any set of values. Kukathas argues that, if the government imposes values by force, individuals will feel compelled to rebel or to act against their conscience.

The author adds that the “most important source of human motivation is principle—or, better still, conscience. … not because conscience always overcomes or overrules other motives … [but because conscience is] what we think should guide us.”

In an environment where private elements come together, eliminating the need to follow the values imposed by a governmental body, individuals are compelled to follow their heart, so to speak.

Adding the private element to a traditional school removes many of the impositions traditional educators, parents, and students are often faced with, boosting efficacy and yes, diversity. Not only because schools might be effectively targeting minorities, but because children stuck with bad educational choices due to their zip code are now given the opportunity to choose.

Students may come from a variety of backgrounds, but they also resort to charters because they have specific goals in mind: get a better education.

Schools with the private element are freer to experiment, giving students who are willing to follow their style an opportunity to grow while “weeding out” those who are not particularly fond of that school’s mission.

In the traditional school system, a child’s fate is set by his or her zip code. But where choice abides, so does conscience. And that’s why the removal of value imposition through government often produces great results.

Revolving Door: Google Enjoys Privileged Position within the US Government

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Revolving Door: Google Enjoys Privileged Position within the US Government

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Putting an end to the revolving door used to be one of the issues presidential candidate Barack Obama appeared to be most passionate about. In December of 2007, then Senator Obama vowed to close the “revolving door … [in other words] the pattern of people going from industry to agency, back to industry,” as soon as he entered the White House. But by 2016, Franklin Center’s Watchdog.org reports, the practice couldn’t get more popular.

GoogleSince 2009, more than 250 people moved between Google and other related firms and the federal government. According to the results produced by Campaign for Accountability’s Google Transparency Project, there have been 258 revolving door instances associated with Google employees and other related firms. In many cases, these individuals were either involved with national political campaigns or with federal government agencies and Congress.

But according to Watchdog.org, one of the most eye-catching discoveries is that “[m]uch of that revolving door activity took place at 1600 Pennsylvania Avenue, where 22 former White House officials went to work for Google and 31 executives from Google and related firms went to work at the White House.”

In many of these cases, the Obama administration appointed these individuals directly.

Many of the Google employees who left the tech giant and its associated firms ended up in the President’s Council on Science and Technology and the President’s Council on Jobs and Competitiveness, two boards responsible for regulating programs that directly impact Google as a company.

When the other end of the revolving door is analyzed, we also learn that 25 government officials involved with the intelligence community, the Department of Defense, or national security have joined the Silicon Valley giant in the past few years. And at least 18 former State Department officials embraced new positions with Google as well, while five Google staffers were hired by the State Department, and at least three Google executives switched jobs, moving their desks to the DOD headquarters.

According to the general counsel for the Project on Government Oversight, Scott Amey, the number of people moving between the government and Google is high, raising concerns among anti-revolving door activists. Amey says that precisely because information concerning the quantity of people involved in this revolving-door game is hard to find, the actual scope of this mass migration may not be easy to grasp at the moment. Nevertheless, 250 individuals involved in this activity is “a very significant number.”

Amey told Watchdog.org that, if individuals working inside the government “have access to information on competitors and they go to Google … then you have to wonder if Google is getting an unfair advantage over others in their market.” Interestingly enough, Amey’s comment serves as the perfect example of why crony capitalism or, in other words, the marriage of the state and private special interests, is bad.

Without a government setting the rules, winners are only picked by the market, not the privileged few.

How Crony Capitalism Almost Destroyed a Small Vegan Business

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How Crony Capitalism Almost Destroyed a Small Vegan Business

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Crony capitalism, what many still believe to be actual capitalism, is everywhere. That’s why every aspect of modern life seems to be ruled by those who nurture a cozy relationship with government.

Even what you eat for breakfast is under their control.

PastaLast year, we learned that the American Egg Board, a group of egg producers supervised by the US Department of Agriculture (USDA), had used its influence and might to (try to) destroy a small company, the start-up Hampton Creek, which is behind Just Mayo.

The egg-less product became the target of the crony organization, which is funded by the mandatory fees members of the industry must pay, whether they are willing to be part of the organization or not. The USDA is in charge of overseeing the group’s budget and activities, making the AEB an arm of the state. So when the group’s president called the vegan Just Mayo a “crisis and major threat to the future of the egg product business” in an email and a USDA official suggested having Just Mayo’s labeling claims challenged with the US Food and Drug Administration, Hampton Creek was hit with a warning letter claiming that they had made unauthorized claims regarding their product, effectively “misleading” consumers by using the image of an egg on the label of a vegan item.

But the FDA move wasn’t enough. Later, the cartel group with direct ties to the US government moved to hire a lobbyist with the goal of making the grocery chain Whole Foods stop selling Just Mayo. While this step backfired, AEB ended up looking to another corporate ally to put an end to the competitor by convincing Unilever, the manufacturer of Hellman’s Mayonnaise, to file a lawsuit against Hampton Creek.

The lawsuit was later dropped.

A Freedom of Information Act request helped us learn more about this sordid pursuit against the small company just because of its competitive factor, giving us yet another great example of how government and special interests often work together to put an end to anything that makes them uncomfortable.

In a recent article for the Tenth Amendment Center, Mike Maharrey claimed that this episode in the recent history of food regulations shows the importance of fighting the federal government locally. After all, Maharrey wrote, “[t]he Constitution does not delegate the federal government any authority to regulate food safety.”

Despite the lack of legitimate authority, special interest groups like the American Egg Board continue to become involved with government, both local and federal. As they obtain privileges and special treatments that competitors do not enjoy, lobbyists work alongside lawmakers to solidify their clients’ position, oftentimes creating a scare regarding their competitors’ products that are sometimes powerful enough to nearly destroy small companies.

The result? Consumers end up having restricted access to variety, forcing the prices of commodities to go up.

Even if you’re not entirely positive the US Constitution should be followed at all times, you might agree that, if regulators and lawmakers do, indeed, have the health and safety of consumers in mind, they should be celebrating and welcoming new competitors in the food market, not fighting to keep the number steady. ​

How Regulation & the Fed Killed the Competitive Spirit in the Banking Community

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How Regulation & the Fed Killed the Competitive Spirit in the Banking Community

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During a recent House Committee on Oversight and Government Reform hearing, a group of lawmakers wanted to know why there have been so few new banks opening their doors in America in recent years.

MoneyWhile it’s hard to admit that, for once, a group of Washington insiders are actually asking the right question, it’s also important to go beyond their concern by looking at why the sluggish economy is, in fact, to blame, but not because of economic factors alone. The problem, Mercatus Center’s Stephen Matteo Miller wrote, is regulation.

As the country announced the end of the economic crisis of 2008, the Federal Deposit Insurance Corporation’s application process was prolonged, hoping to cap the number of failed banks over time.

While this explains part of the problem, another issue also brought up by the Mercatus scholar may explain the other reason why there’s so little competition in the banking business.

According to a study carried out by the Federal Reserve Bank of Richmond, the implementation of low interest rates defended by the Federal Reserve leadership may have had been directly to blame for low competition as well.

The conclusion both economists and the Mercatus scholar agreed on despite the findings by the Richmond Fed is that, laws like the Dodd-Frank Act, which adds to the regulatory burden, as well as the FDCI’s rule change had the most negative effect on the competitive aspect of the banking market, effectively protecting established banks and keeping smaller, more consumer-oriented banks out of the market. The artificial modifications made by the Fed have also contributed.

Over time, restrictions developed as regulations embodied in the Code of Federal Regulations have also had a negative effect on the overall health of the American economy. According to the Cumulative Cost of Regulations study carried out by the Mercatus Center, the regulatory burden may have helped to reduce gross domestic product (GDP) by $4 trillion. This aggressive and dramatic reduction may have also prompted entrepreneurs in the banking community to think twice before launching a new business.

So when reviewed carefully, the phenomena now under consideration by Congress has little to do with what many believe to be slow economic growth, or what many progressives like to call “record profits.” After all, it’s easy to measure how successful the established, too-big-to-fail banks have become over the past 6 or 7 years. What’s hard to assess is how much wealthier we would have been if government had gotten out of the financial system altogether.

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