Hipsters and not so cheap beer

Can’t really vouch for the study discussed here which attributes watered down beer inflation to people with lots of facial hair and skinny jeans:

Cheap beers are becoming less cheap, and for that you can thank hipsters.

A recent study by Restaurant Sciences found that your everyday, low-cost beerslike Budweiser, Miller Light and Coors Light are getting pricier, a trend the firm attributes to the rise in popularity of Pabst Blue Ribbon — a favorite among your bearded, flannel shirt-wearing friends.

Basically, as Chuck Ellis, the head of Restaurant Sciences, put it, PBR has become “quite fashionable.” This has allowed bars and restaurants to get away with charging more for the beer’s low-price peers.

“I believe the single biggest driver in sub-premium beer price increases is indeed specifically PBR,” Ellis told the New York Daily News.

But for those in a certain age group, any discussion of PBR naturally brings this to mind:

Cutting the insurance cord

A story about one South Portland doctor’s fight against the system:

SOUTH PORTLAND, Maine — Dr. Michael Ciampi took a step this spring that many of his fellow physicians would describe as radical.

The family physician stopped accepting all forms of health insurance. In early 2013, Ciampi sent a letter to his patients informing them that he would no longer accept any kind of health coverage, both private and government-sponsored. Given that he was now asking patients to pay for his services out of pocket, he posted his prices on the practice’s website.

The change took effect April 1.

New York State Tax Cuts (for some..)

Here is the story which details the proposal:

Syracuse, N.Y. – Gov. Andrew Cuomo would give qualifying businesses that move onto state college campuses a free ride – no property taxes, no corporate taxes, no sales taxes and no income taxes for their workers.

Yes, the governor said today as he repeated the plan in Albany, Buffalo and Syracuse: 100 percent tax free.

“I mean tax free,” he said at the SUNY Upstate Medical University in Syracuse. “That’s why I said tax free.”

Cuomo, a Democrat in his third year, says the Tax-Free NY program would encourage start-ups that grow out of college campuses to stay put and expand their business in New York. Existing businesses, both in New York and out-of-state, would also qualify so long as they created new jobs and had a mission related to the academic mission of the university or community college.

Under the proposal, a business’s tax-free status would last a decade. Workers would go five years without paying income taxes. After that, their first $200,000 of income would be tax free, under the governor’s plan.

If passed by the New York State Legislature, the plan would put a total of 120 million square feet across the state into tax-free zones. That’s equal to all the office space in Buffalo, Rochester and Syracuse combined, the governor said.

“It’s big, it’s bold,” Cuomo said this afternoon at an editorial board with The Post-Standard and Syracuse Media Group. “I think it could make a major difference.”

 Frankly, this looks like a recipe for more State control of the economy and more power for those in government.  Certain businesses that curry favor with the administration will get special benefits and everyone else, by necessity, will pay more.  The Governor admitted as much:

Cuomo acknowledged his tax-free proposal sets up winners and losers in the state tax code.

“That is the way of the world, now,” Cuomo said. “The tax code is riddled with benefits, burdens for specific businesses. In a perfect world, would you say, ‘Everyone — equal footing?’ Yes. But it’s not a perfect world.”

I guess that makes sense since if all taxes were cut and if everyone were treated alike no one would feel the need to financially support their political overlords. For those in the business of government that world would be far from a perfect one indeed.

The War on Men

Most of the taxes paid into the government are paid by men. Most of the benefits taken out of the government are taken by women. Walter Russell Mead reports that Obamacare will further exacerbate this imbalance by generally transferring wealth from younger men to older women.

Young men will be the biggest losers in the transition to Obamacare, according to a new report by the actuarial and consulting firm Milliman. The report estimates that males as a whole will see an 11 percent increase in insurance premiums, while females as a whole will see a nine percent decrease. Men under 40 will face insurance hikes of 18 to 31 percent; females under 40 will benefit from 13 to 19 percent decreases.

But here’s the real kicker: premiums for young men ages 25-36 could increase by more than 50 percent.

The balance of political power is shifting against men. And as the government gets more and more involved in rationing health care, America’s non-elite, non-ruling-class males might have to consider themselves lucky if they receive any medical care at all. Indeed, Yet, Freedom’s crystal ball predicts that scarce funding for research and treatment will increasingly tend to favor women’s health issues, like breast cancer, at the expense of men’s health issues, such as prostate cancer. This trend reflects the relatively diminishing political and economic power of men, as well as the natural, though not necessarily moral, human instinct to view beta males as expendable. And so the beta males, as usual, will just have to suck it up.

The French Culture of Taxes

Under the apparent belief that more government and higher taxes can halt their economic decline, the French government is considering a new “culture tax” on technology products:

Smartphones and tablets are at the center of new proposals from former Canal Plus CEO Pierre Lescure, whom France’s socialist government tasked with finding new ways of funding French cultural projects in the face of an economic downturn, Reuters reported on Monday. Lescure, noting that consumers are spending more money on hardware than on content, proposed a one percent tax on the sale of Internet-compatible devices.

The new tax would target iPhones and iPads from Apple, but also Android tablets and Amazon’s Kindle Fire devices.

Lescure’s plan would likely yield roughly 86 million euros per year. That revenue would go to support cultural industries creating French music, images, and videos, according to the proposal. Television users, TV and radio broadcasters, and Internet service providers already pay a similar tax.

In France, cinema, music, and other creative sectors fall under the “cultural exception,” which largely protects them from foreign competition. France lobbies heavily for the protection of its culture, with officials from the country expected to push for the exemption of its cultural products from free trade rules in forthcoming talks.

We are not sure what it means to say that “France” lobbies heavily for protection, but we’re pretty sure a lot of lobbying does take place from the “cinema, music, and other creative sectors”. 

 

Is the IRS scandal the worst political scandal in American history?–Updated.

Bookworm tries to make the case:

The absolute worst scandal that’s emerged lately, and the worst administration scandal in American history is the IRS scandal. Why? Because you, the People, became the targets of a comprehensive federal government effort to stifle dissent, one made using the government’s overwhelming and disproportionate policing and taxing powers.

All of the other scandals, going back to Andrew Johnson’s post-Civil War scandals, Warren G. Harding’s 1920s Teapot Dome scandal, Nixon’s Watergate, Reagan’s Iran-Contra, and Clinton’s Oval Office sexcapades have actually been narrowly focused acts of cronyism, garden-variety political chicanery, or personal failings. It’s been insider stuff.

The IRS scandal, by contrast, is a direct attack on the American people.

Good points, and given that the IRS has the power to destroy people, abuse of that power is always a very serious matter. But concerning the historical merits of Bookworm’s argument, we note that, when it comes to suppressing dissent, it’s very difficult to match the depredations of the administration of Woodrow Wilson.

 [T]he Espionage Act even made it illegal to teach, suggest, defend, or advocate any criticism of the government. The bill gave the Postmaster the right to refuse delivery of any periodical he deemed unpatriotic or critical of the administration. The Postmaster soon stopped delivery of virtually all publications and any foreign-language publication that hinted of dissent…

The Federal Bureau of Investigation created a volunteer group, called the American Protective League (APL) and made it an adjunct of the Justice Department. The APL was authorized to carry badges identifying them as “Secret Service” and within a year 200,000 APL members flooded the country, targeting any dissent.

This remarkable act made it virtually illegal to criticize the war or the government in any way. As a result, the Civil Liberties Bureau, a forerunner of the American Civil Liberties Union (ACLU), was formed in 1918 to oppose this legislation and the corrupting influence it had on American freedoms (the ACLU was formed in 1920).

And if that weren’t bad enough, then came the Palmer Raids on suspected radicals.

At 9 pm on November 7, 1919, a date chosen because it was the second anniversary of the Bolshevik revolution, agents of the Bureau of Investigation, together with local police, executed a series of well-publicized and violent raids against the Russian Workers in 12 cities. Newspaper accounts reported some were “badly beaten” during the arrests. Many later swore they were threatened and beaten during questioning. Government agents cast a wide net, bringing in some American citizens, passers-by who admitted being Russian, some not members of the Russian Workers. Others were teachers conducting night school classes in space shared with the targeted radical group. Arrests far exceeded the number of warrants. Of 650 arrested in New York City, the government managed to have just 43 deported.

The Justice Department launched a series of raids on January 2, 1920 with follow up operations over the next few days. Smaller raids extended over the next 6 weeks. At least 3000 were arrested, and many others were held for various lengths of time. The entire enterprise replicated the November action on a larger scale, including arrests and seizures without search warrants, as well as detention in overcrowded and unsanitary holding facilities. Hoover later admitted “clear cases of brutality.” The raids covered more than 30 cities and towns in 23 states, but those west of the Mississippi and south of the Ohio were “publicity gestures” designed to make the effort appear nationwide in scope. Because the raids targeted entire organizations, agents arrested everyone found in organization meeting halls, not only arresting non-radical organization members but also visitors who did not belong to a target organization, and sometimes American citizens not eligible for arrest and deportation.

The Department of Justice at one point claimed to have taken possession of several bombs, but after a few iron balls were displayed to the press they were never mentioned again. All the raids netted a total of just four ordinary pistols.

We can hope that this nation never again sees the likes of the Wilson Administration. But we must also remain vigilant in defense of our liberties.

Update. America’s top political journalist, Michael Barone, notices that the current political scandals do indeed harken back to the restrictions on civil liberties enacted during the Wilson era. In particular, the Obama Administration seems regrettably to have revived prosecutions under the Espionage Act of 1917, which was passed shortly after the U.S. entered World War I, but has been used very little since then.

Wilson’s Justice Department successfully prosecuted Eugene Debs, the Socialist candidate who received 900,000 votes for president in 1912, for making statements opposing the war. The Wilson administration barred Socialist newspapers from the mails, jailed a filmmaker for making a movie about the Revolutionary War (don’t rile our British allies), and prosecuted a minister who claimed Jesus was a pacifist. German-language books were removed from libraries, German-language newspapers were forced out of business, and one state banned speaking German outdoors.

It was an ugly period in our history. It’s also a reminder that big-government liberals can be as much inclined to suppress civil liberties as small-government conservatives can — or more so.

Fortunately, things changed after Wilson left office. A Republican Congress allowed the Sedition Act to expire in 1921. Debs received 915,000 votes for president in 1920 while in Atlanta federal prison, but President Warren Harding, a former journalist and a Republican, commuted Debs’s sentence to time served, effective Christmas day 1921, and invited him to the White House.

The Espionage Act of 1917 remained on the books and was amended to cover news media. But it was used sparingly…

Presidents and attorneys general of both parties have been reluctant to use the Espionage Act when secret information has been leaked to the press because they have recognized that it is overbroad. They have understood, as Moynihan argues in Secrecy, that government classifies far too many things as secrets, even as it has often failed to protect information that truly needs to stay secret.

Barack Obama and his Justice Department seem to be of a different mind. They have used the Espionage Act of 1917 six times to bring cases against government officials for leaks to the media — twice as many as all their predecessors combined.

“Gradually, over time,” Moynihan writes, “American government became careful about liberties.” Now, suddenly, it seems to be moving in the other direction.

Indeed, liberty moving in the wrong direction is an all too common theme of late.

Cui Bono? European Olive Oil Regulations

Whenever a regulatory restriction is passed we try to evaluate the policy change by looking at the winners and losers. The winners tend to have the capacity and incentive to lobby for the change.  Since Yet, Freedom! is currently in Rome, illustrating this point with this example seems appropriate:

The small glass jugs filled with green or gold coloured extra virgin olive oil are familiar and traditional for restaurant goers across Europe but they will be banned from 1 January 2014 after a decision taken in an obscure Brussels committee earlier this week.

From next year olive oil “presented at a restaurant table” must be in pre-packaged, factory bottles with a tamper-proof dispensing nozzle and labelling in line with EU industrial standards.

The use of classic, refillable glass jugs or glazed terracotta dipping bowls and the choice of a restaurateur to buy olive oil from a small artisan producer or family business will be outlawed.

Teenage Wasteland

The 26th amendment to the United States Constitution lowered the voting age for elections in the U.S. to 18 years of age. It was passed on March 23, 1971 and officially ratified on July 1, 1971.   This change made a lot of sense.   With the prior minimum, which was  set at 21 years of age,  young Americans could join the military and potentially be killed in a foreign war, but could not vote.  Can’t really think of much of a downside? Oh, wait!

 

Today’s universities are vacation resorts

We’ve discussed previously how public subsidies for “higher education” have fueled a massive expansion of useless campus bureaucracy, and more info on administrative bloat can be found here. A lot of that excess cash, however, has financed something else:  highly extravagant recreational facilities. Check out Texas Tech’s “leisure pool.”

See also Freddie DeBoer‘s excellent and extensive report on Purdue’s new recreational sports facility, known as the “CoRec.” The facility’s amenities include:

  • Five stories and 338,000 square feet. In comparison, the Anytime Fitness in Springboro encompasses about 5,000 square feet.
  • Dozens of flat-screen TVs, even in the locker rooms.
  • A “stretching cage”
  • Fitness Loft, Fitness Pavilion and…wait for it…Fitness Mezzanine!
  • About twenty basketball hoops, plus racquetball, volleyball, badminton, indoor soccer and indoor hockey.
  • A bouldering wall, not to be confused with the 55-foot climbing wall.
  • 26-person Jacuzzi spa, plus indoor pool with two water-basketball hoops.

And on and on. Read the whole thing. If students want to pay for all this through their tuition, that’s fine. But the problem is that a significant portion of all this extravagance is paid for by the taxpayers, who probably have better uses for their money than enabling upper-middle-class 21-year-olds to lounge around in Jacuzzi hot tubs.

Meanwhile, time-use studies report that college students spend hardly more than half as much time studying as they did 50 years ago.

According to time-use surveys analyzed by professors Philip Babcock, at the University of California Santa Barbara, and Mindy Marks, at the University of California Riverside, the average student at a four-year college in 1961 studied about 24 hours a week. Today’s average student hits the books for just 14 hours.

Well, maybe if there weren’t so many distractions…

Finally, note that the “leisure pool” video above was posted to YouTube by Texas Tech itself. They are actually proud of this profligacy. Hopefully, Texas taxpayers will get a good look at their tax dollars at work.

 

The UAW bailout

Milton Friedman had a pithy, one-line explanation for why government can’t be expected to spend money wisely: You can’t expect someone else to spend your money as carefully as you would spend it yourself. The news this week shows that you also should not want government to invest your money, as the US Treasury announced plans to sell its remaining shares in General Motors–at an $11 billion loss. The loss is considerable, but would have been even higher if not for the recent run-up in stock prices, engineered by the Federal Reserve.

In any event, the $11 billion loss must be borne by everyone who pays taxes, which includes everyone who writes for this website. So what did we get for our money? Well, according to Tim Massad, assistant secretary for financial stability at the Treasury, the government’s “emergency support to GM during the financial crisis was necessary to prevent the collapse of the American auto industry and save more than 1 million American jobs.”

Oh really? Which American auto industry would that be? Because there are really two American auto industries. There’s an almost entirely non-unionized one run by foreign companies such as Honda, Nissan, Hyundai, and BMW. These and other foreign automakers

have invested $44 billion into their U.S. operations, accounting for 80,000 direct vehicle-manufacturing jobs and an additional 500,000 dealer and supplier jobs, according to the trade group Global Automakers.  Their 300 U.S. facilities also account for nearly half of all vehicles built in the U.S.

Then there’s the fully-unionized auto industry: Ford, GM, and Chrysler. The bankruptcies occurred only in the unionized industry, but did not include Ford: only GM and Chrysler. Moreover, GM and/or Chrysler may well have survived even without bailouts; they might have been merely restructured in Chapter 11 bankruptcy, as have many other large companies such as United Airlines.

Otherwise, even if one or both of GM or Chrysler had in fact been liquidated, much of their productive assets would have transferred to other automakers, who would have filled the gap by expanding their own production. Notwithstanding the statement by assistant secretary Tim Massad, we conclude that the auto bailout did not “prevent collapse of the American auto industry.”

How about Massad’s claim that the bailout saved “more than one million American jobs?” Some jobs associated with the auto industry may have been lost, but it cannot be true that America’s entire economy would have lost one million jobs overall. For instance, it cannot be true that America would have had 144 million jobs with the bailout, but only 143 million without it. Why? First, as noted above, not all jobs supported directly or indirectly by GM or Chrysler would have been lost because one or both of those firms might have emerged from Chapter 11. And even if they had not survived, their assets would have been productively employed by other automakers, thus expanding employment among those other auto firms.

It is, however, possible that a few auto and related jobs might have been lost, but probably far less than one million. Moreover, the resources freed up from the auto industry would become available to support employment in other industries. Every dollar that Americans no longer spent on GM or Chrysler products becomes available for spending on other products, perhaps including landscaping or health care. So while America might have lost some auto industry jobs, these would largely or entirely be offset by new jobs in landscaping, health care, and other occupations. The best guess is that the overall number of jobs should hardly change at all.

But what if Chrysler and GM had failed, and the money previously spent on their products were diverted to purchasing imports? Money spent on imports would not directly support production and jobs in the U.S., so wouldn’t the U.S. lose jobs in that case?

No, because money spent on imports still supports jobs in the U.S. indirectly. The reason is that money spent on imports must either a) come back to the U.S. as foreigners spend the money on U.S. exports or b) if there’s a trade deficit, what’s not spent on U.S. exports comes back to the U.S. as investment. Either way, the money spent on imports indirectly supports production and jobs in the U.S.

We conclude that Tim Massad’s claim that the bailout saved “more than one million American jobs” is false. Indeed, his statement is so inaccurate that he must be either pathetically ignorant and incompetent, or he is a public servant who is willfully misleading his employers–the American people. In a world where the people held their public servants to a higher standard of accountability, he would be tarred and feathered.

So, the taxpayers basically get nothing in return for their $11 billion. Most of the benefit of the bailout goes instead to the UAW. Note that the bailouts did not prevent bankruptcy; GM and Chrysler both did go through bankruptcy. But without the bailout money, the bankruptcies would almost certainly have voided the union contracts. That outcome, and not concern about overall U.S. employment, is what motivated the bailouts. The UAW used its political influence to get the government to structure the bankruptcies in a way that preserved the union contracts. The bailouts didn’t rescue an industry, or even specific firms, so much as they rescued a labor union. Rather than “auto bailouts,” they should more accurately be called the “UAW bailouts.” The bailout money was needed to finance rigged, and frankly lawless, bankruptcy plans that preserved the UAW’s perks, privileges, and 2,000 pages of work rules. That’s what taxpayers got for their $11 billion. What a deal!

And note that the $11 billion must be paid for by people who worked hard, chose wisely, and acted responsibly and who, unlike the UAW, didn’t run their businesses into the ground. As usual, government punishes the prudent to reward the imprudent. This phenomenon is what a typical college professor might describe as “social justice,” the modifier “social” being necessary to distinguish it from regular, plain-old, you know, justice.