Coyote Blog

Gee, why isn't the Congress doing something about this price gouging in a scarce commodity post-Katrina?

Burger King is offering a $6,000 signing bonus to anyone who agrees to work for
a year at one of its New Orleans outlets. Rally's, a local restaurant chain, has
nearly doubled its pay for new employees to $10 an hour...

On any given day, contractors and business owners pass out flyers in
downtown New Orleans promising $17 to $20 an hour, plus benefits, for people
willing to swing a sledgehammer or cart away stinking debris from homes and
businesses devastated by Hurricane Katrina ...

"I'd say I'm paying two to three times as much as I would in normal
circumstances," said Iggie Perrin, the president of Southern Electronics, a
supplier in New Orleans, who has offered as much as $30 an hour when seeking
salvage workers on Canal Street...

One of the things that takes some of the fun out of running a small business is knowing that, despite all your best efforts, you are probably violating the law somewhere and there is a bureaucrat (or in California, a tort lawyer) trying to make a name for themselves by nailing you for this technical violation.  Now, I'm not talking about chaining employees to the assembly line or even paying below the minimum wage.  I am talking about $45,000 fines for not splitting the two portions of a Davis-Bacon wage out correctly on a pay stub or getting sued for not properly posting one of your required labor department posters or having a counter 1/2" too high for ADA regulations.

Via Overlawyered comes this Independence Institute (pdf) report about the criminalization of everything, a practical primer on the philosophic  musings on individual decision-making here.

There is a principle in jurisprudence that "ignorance of the law is no excuse." In other words, no one can justify his illegal conduct on the grounds that he was unaware of the law. But what happens when the sheer volume, complexity, and ambiguity of the law means that neither citizens, nor the government, can reasonably know
what is and is not against the law?

Colorado currently has some 30,000 laws filling more than 50 volumes of the Colorado Revised Statutes, both criminal and regulatory. Every session, the Colorado General Assembly passes hundreds of new laws for government to enforce and citizens to both understand and obey. Aside from the sheer number of laws, the definition of what constitutes a criminal act has changed; often the legislature actually creates new crimes, and thus, new criminals, where no inherent criminality exists.

We operate in 11 states.  Think of it.  50 volumes times 11 states plus the federal code.  Eeek.

In his book Drug War Addiction, Sheriff Bill Masters of San Miguel County Colorado describes his discovery of the Colorado Statutes of 1908. At the time, "all the laws of the state fit in one volume. Murder, rape, assault, stealing, and trespassing were all against the law in 1908.

So the other 49 volumes outlaw, what?

Update:  Welcome Overlawyered readers.  More thoughts on the dangers of the over-regulated state here.

Only the government (in this case the state of Texas) could have a line on a form like this:

17.  Enter the ending date of the twentieth week of employment in the calendar year in which this organization had at least one person employed in Texas

So I am confused about this.  What week do I enter if operations started in September of this year, pushing 20 weeks into next year?  Well, fortunately the state included a sheet along with this form to provide instructions for filling it out.  This is how these instructions explain it:

Item 17:  Enter the ending date (Saturday) of the 20th week of the calendar year in which one or more individuals performed services in Texas.

Well, now its clear.

...the spectacle of Congress calling oil executives on the carpet
for not investing enough in domestic oil exploration, and then 24 hours
later extending the ban on oil exploration in the ANWR. 

Priceless.

The other day in my post on Politics without Philosophy, I mentioned in passing the philosophical inconsistencies on the National Organization for Women (NOW) website.  Specifically, I referred to the premise that women should control the decision-making for their own body (a premise I accept) and noted the inconsistency of some of their positions, notably opposition to breast implants, with this position.  As usual, I got several emails on "my attack on women", which is pretty normal nowadays:  People tend to associate an attack on an organization purporting to represent a certain group with an attack on the group itself. 

Anyway, this post was just going to be an update, to provide the specific links on NOW's seemingly conflicting positions on abortion and breast implants, but in the process, I discovered another very interesting inconsistency, which I will get to in a few moments (its in bold at the bottom if you really can't wait).

In posting on the breast implant - abortion conundrum, I should have linked to this post, where I explained in more detail:

When it comes to defending abortion, women's groups are great
libertarians. They will point out that abortion is about the right to
choose and about protecting the "fundamental civil and human right of
women to make the most intimate decisions about their bodies and their
lives".  Its about not letting the government interfere with individual
decision-making or a "woman's right to privacy".  Its about assuming
women are grown-up enough to make difficult choices about their fetus
and their own health and safety.  Opponents of such choice are
"ultra-conservatives trying to deny women control over their own
bodies".  (all quotes from the NOW web site).

So, women's groups seem to be good libertarians concerned with the primacy of women's decision-making over their own body.  Except when they're not.
NOW has been feverishly campaigning to get the government to limit a
women's right to choose breast augmentation, despite the fact that the
science is overwhelmingly behind the safety of implants.  Sure, as in
any medical procedure, there are some risks, but I defy anyone to tell
me that the risks associated with breast implants are greater than the
risks associated with abortion.  Abortion is a much weightier and more
difficult decision, and, unlike breast implants, it is irreversible.
If women are mature enough to make abortion decisions, they certainly
are mature enough to weigh the risks of breast implants.  Or take the
birth control pill -- the impact to a woman's body of silicone sacks in
their boobs is far less than that of trashing their entire hormone
balance.  Sure, the pill makes sense for a lot of people and its great
that the option exists, but don't tell me that the the changes the pill
engenders in the body are OK but bags of silicone are not.

Note that if you accept the notion of a woman's right to choose for her own body, the risks of breast implants shouldn't matter.  A good government might make sure these risks are revealed, but would leave decision making on the risks vs. rewards to the individual.  For the sake of completeness, though, here is NOW's argument that breast implants are just too risky and here is the counter-argument, supported by most scientists and the medical profession, that there is nothing wrong with them.  Note, however, the NOW would not tolerate casting the abortion debate around safety or risk, arguing in that case that it is up to the woman to make these informed trade-offs.

Anyway, here is what I learned from grabbing a few of the links above.  Consistent with their position on breast implants (and their heavy funding from the tort bar) NOW also is criticizing the FDA for allowing the Vioxx painkiller on the market.

Whether it's Vioxx or Bextra or silicone implants, the rule now
is 'Buyer Beware, said [NOW President Kim] Gandy. The drug and device companies own
the FDA and it is the companies' profit potential that rules the
review and approval process - except when the profit motive is
overridden by the White House morality police, as with the
morning-after pill.

Yep, the FDA is apparently not doing a good job in limiting the number drugs or procedures women choose to put in their bodies (more on Vioxx on the NOW web site).  But this is still not the really funny part, just another illustration of how NOW only seems to apply "Its her body" to abortion, rather than any other decision.  What was really interesting was this (emphasis added):

An assisted suicide
bill (AB 654) passed the Democrat-controlled Assembly Judiciary
Committee on Tuesday, following two hours of debate. It now moves to
the full Assembly, where a vote may come in May.

Groups
officially supporting the bill include the pro-euthanasia group
Compassion & Choices; the American Civil Liberties Union, the
California Alliance for Consumer Protection, the California National Organization for Women; the Conference of Delegates of California Bar Associations; Drug Policy Alliance Network; and End-of-Life Choices.

I am OK with legal suicide as the last-ditch pain-relief strategy, though I am uncomfortable allowing doctors to help, given the inherent conflicts (maybe create a new suicide midwife profession?)  Anyway, note from this that while NOW opposes women's access to legal Vioxx, they support legal access to assisted suicide.  In case you are missing the full irony, I will restate it:  NOW supports the legality of a pain-relief strategy (assisted suicide) with a 100% chance of death but opposes the legality of a pain-relief strategy (Vioxx) with a less than 1% chance of death.

I don't really mean to pick on NOW in particular.  As I said before, nearly any organization on the right or left tends tends to espouse contradictory positions in the same manner.  NOW is just a particularly easy target since it takes positions on so many things.  Also, I must admit that they particularly piss me off some, articulating a fine libertarian point of view that women, and not the government, should control decision-making for their own body, and then abandoning this premise on nearly every non-abortion topic they address.

Anyway, you can read more on how the left really doesn't want to address the full implications of the Roe v Wade privacy right here.  If you want to understand why NOW takes the positions it does, beyond the usual we-know-better-what-is-good-for-women-than-they-do-themselves elitism, you might look at the NOW relationship to the tort bar.  NOW is usually prominently featured on the ATLA web site.

Last week, I posted on why Wal-Mart may be calling for higher minimum wages, and hypothesized that it may be because it won't hurt them (since they already pay well higher than the minimum) and may hurt competitors.  Llewellyn Rockwell of the Mises Institute, one of the few people in America with three sets of double-L's in his name, expands on this hypothesis:

The current minimum is $5.15. According to studies, Wal-Mart pays between
$8.23 and $9.68 as its national average. That means that the minimum wage could
be raised 50% and still not impose higher costs on the company....

So who would it affect if not Wal-Mart? All of its main competitors. And the
truth is that there are millions of businesses that compete with it every day.
Many local stores have attempted to copy Wal-Mart's price-competitive model, but
face lower costs and can actually thrive....

Even similar stores such as K-Mart can pay lower wages, and that can make the
margin of difference. K-Mart pays over a much wider range, as low as $6.75 an
hour. A major competitor is mainstream grocery stores, where workers do indeed
start at minimum wage. Target too pays starting employees less than Wal-Mart, if
the Target Union can be
believed.

Now, if Wal-Mart can successfully lobby the government to abolish lower-wage
firms, it has taken a huge step toward running out its competition. The effect
of requiring other firms to pay wages just as high as theirs is the same as if
the company lobbied to force other companies to purchase only in high
quantities, to open large stores only, or to stay open 24 hours. By making
others do what Wal-Mart does, the company manages to put the squeeze on anyone
who would dare vie for its customer base.

Now here is the great irony. The left has long been in a total frenzy about
how Wal-Mart saunters into small towns and outcompetes long-established local
retailers. Wal-Mart's opponents have whipped themselves into a frenzy about the
company's success, claiming that it always comes at a huge social cost.

Now, most of this rhetoric is overblown and ignorant. Wal-Mart would not have
made any profits or grown as it has without having convinced the consuming
public to purchase from the store. Consumers could put the company out of
business tomorrow, just by failing to show up to buy.

The left's claims of unfair practices would be valid if Wal-Mart did indeed
work to impose legal disabilities on its competitors "” in effect making it
illegal to outcompete the company. And yet that is precisely what raising the
minimum wage would do: impose a legal disability on those companies engaged in
lower-wage competition with Wal-Mart. So the economically ignorant left
advocates raising the minimum wage.

Apparently, though I can't dig up a link right this second, Wal-mart is putting its support behind a higher minimum wage.  One way to look at this is a fairly cynical ploy to get the left off its back.  After all, if Wal-mart's starting salary is $6.50 an hour (for example) it costs them nothing to ask for a minimum wage of $6.50.

A different, and perhaps more realistic way to look at this Wal-mart initiative is as a bald move to get government to sit on their competition.  After all, as its wage rates creep up, as is typical in more established companies, they are vulnerable to competitors gaining advantage over them by paying lower wages.  If Wal-mart gets the government to set the minimum wage closer to the wage rates it pays, it eliminates the possibility of this competitor strategy.  Besides, a higher minimum wage would surely put more low-skilled people out of work, increasing the pool of people Wal-mart can hire  (and please do not bring up the NJ convenience store study that supposedly shows that higher minimum wage increase employment - no one in their right mind really believes that demand for labor goes up when the costs go up).  I am not sure what the net effect on Wal-mart's customers would be -- some would have more money, from higher wage, and some would have less, from fewer hours or due to being laid off.

I have defended Wal-mart in the past, but I am going to stop if they become the new auto or steel industry and use the government to protect their market position.  Already they are losing my sympathy with their whoring for local relocation subsidies and eminent domain land grabs.  I wrote on minimum wage from a small business perspective here.

I had seen some Internet posts on this before, but I thought it was from the "Aliens were behind the 9/11 attacks" crowd.  But it does appear to really be Big Brother at work:

The pages coming out of your color printer may contain hidden information that
could be used to track you down if you ever cross the U.S.
government.

Last year, an article in PC World magazine pointed out that printouts
from many color laser printers contained yellow dots scattered across the page,
viewable only with a special kind of flashlight. The article quoted a senior
researcher at Xerox Corp. as saying the dots contain information useful to
law-enforcement authorities, a secret digital "license tag" for tracking down
criminals....

Yesterday, the Electronic Frontier Foundation, a San Francisco consumer privacy
group, said it had cracked the code used in a widely used line of Xerox
printers, an invisible bar code of sorts that contains the serial number of the
printer as well as the date and time a document was printed...

The EFF said it has identified similar coding on pages printed from
nearly every major printer manufacturer, including Hewlett-Packard Co., though
its team has so far cracked the codes for only one type of Xerox
printer.

The U.S. Secret Service acknowledged yesterday that the markings, which
are not visible to the human eye, are there, but it played down the use for
invading privacy.

This kind of stuff really scares me.  Is there anyone out there that thinks that this won't be used to trace a leak, track down a whistle-blower, or identify an anonymous political critic?  And, even if you are able to conjure up trust that the US government will not use these codes for anything other than fighting counterfeiting, what about use of these codes by private parties?  Or, even more depressing, remember that these printers are being sold today in China, Syria, Iran, Zimbabwe, etc.  Does anyone at all doubt that these governments will use the print codes to identify and silence dissent?

Shame on the government for instituting this program.  Double shame on HP and Xerox for going along in silence, joining the ranks of Microsoft, Cisco, and Yahoo in making adjustments to their technology to make government surveillance and censorship easier.  I don't know of any legislative mandate that requires these printer companies to go along with this, so they are doing this voluntarily - sort of (see below).

For those on the left feeling smug that this is solely a right-wing Bush-is-a-fascist problem, shame also on those who built the economic regulatory state that we live in.  In a truly free economy, HP and Xerox would likely have told the government to take a hike.  However, the government holds a huge regulatory hammer over corporations' head in so many realms that companies in our society find it difficult to tell the government off when they get this type of request.  Its the same story with airlines and banks, who feel compelled to share otherwise private customer data with Homeland Security under the threat of having government retribution fall on them from any number of directions.  We have got to start realizing that government control of economic activity is just as much an imposition as government control of speech or the press.  Freedom of expression does not become voided just because money changes hands.

Many thanks to Marginal Revolution for the link.  Their comment:

Would the Berlin Wall have fallen if East European governments had access to
this kind of technology twenty years ago?

I read an interesting article in the NY Times, via Marginal Revolution, interviewing the CEO of homebuilder Toll Brothers about housing prices.  His assertion was:

"In Britain you pay seven times your annual income for a home; in the U.S. you
pay three and a half." The British get 330 square feet, per person, in their
homes; in the U.S., we get 750 square feet. Not only does Toll say he believes
the next generation of buyers will be paying twice as much of their annual
incomes; in terms of space, he also seems to think they're going to get only
half as much. "And that average, million-dollar insane home in the burbs? It's
going to be $4 million."

I don't necessarily buy this whole story.  For one, Mr. Toll has business reasons for taking a public position that prices will keep rising - after all, his customers buy his product in part as an investment, and would be leery about paying current prices if they thought prices might fall in the future.  Second, as I have talked about a number of times with petroleum, when prices of any product start to rise, observers always tend to underestimate market and technology responses that might bring supply more into balance.

However, the one exception I did make in my oil price posts was that government supply restrictions, both on lands that can be explored for oil as well as things like refinery permitting, may indeed put structural upward pressure on prices.  And in fact, this is where Mr. Toll puts the blame for high housing prices as well:

Toll agrees with Glaeser et
al. that the key force driving up prices is zoning and growth regulations. 
In New Jersey it now takes Toll Brothers up to two million dollars in legal fees
and ten years in time to get the permits necessary to build.

Which got me thinking that home owners (of which I am one) may be the worst rent-seekers of all.  Most people are already familiar with the very large tax breaks for home buyers, in the form of the mortgage interest tax deduction, that is not available to people who rent or to people who borrow for purposes other than home purchase.  However, it may be that a much larger implicit subsidy to home-owners is the government restrictions on new home supply.  By restricting supply, the government is keeping prices up for current home-owners and restricting new entrants who might compete with our homes in the resale market.

Apparently, some of our local politicians in the Phoenix area are upset about payday loan companies.  According the an AP report in the AZ Republic:

The stores cater to customers who live paycheck to paycheck who need
quick access to a few hundred dollars for rent, car repairs or just to
make ends meet. Banks traditionally don't make those type of small,
short-term loans.

So these stores provide loans to people no one else will touch.  And customers use their services of their own free will.  So what is the problem?  Well, not surprisingly, the rates on these loans are high, and the default terms tend to be drastic.  "Activists" think that people are making the wrong decision using these services, and, to be fair, I would certainly advise anyone who asked to try to find another alternative.  But what do my preferences matter?  Its easy for me to say in my middle-upper class hubris that such services don't make sense, but I have a steady job and ready access to bank loans.  In a free society, both I and those activists are free to convince people to not use these services, but its wrong to artificially limit people's choices out of some elitist sense that we can make decisions for other people better than they can for themselves.

Besides, lets think about the alternative.  These folks are not going to get bank loans -- in fact many customers may be illegal aliens who are, post 9/11, effectively barred from the banking system.  The only other alternative before these payday loan companies were loan sharks, whose interest is even higher and whose penalty for non-payment even more dire. This reminds me of the people who decry Nike "sweatshop" jobs in poor countries.  "Activists" similarly decry these jobs as if the alternative is $25 an hour office work, when in fact the alternative is actually grinding subsistence agricultural work for half the pay.  You may not like the payday loan companies, but they are replacing a much worse system.

But the really funny thing about this article is their proposed solution to the problem of rates for these payday loan services being too high.  Their solution?  Limit competition!  (emphasis added)

Arizona now has more than 600 payday loan stores - with 165 in the [Phoenix suburb] Mesa area alone - and some residents are upset about it.

"People are sick of it in west Mesa," said Dave Richins, a neighborhood
activist and executive director of the West Mesa Community Development
Corporation.

Richins and other critics claim the stores exploit customers with high interest rates.

[Phoenix suburb] Peoria blocks the shops from opening within 1,000 feet of a competing
store. Phoenix and Tucson are looking to that city's restrictions as a
model for new rules in their communities, with action possible by early
next year.

Gee, I bet that will help keep rates down -- make sure there are no competitors nearby!  Lets make sure it is as hard as possible to compare rates, particularly since the customer base is one that can't afford the gas, or doesn't even have a car, to drive all over town shopping.  I wonder why no one is suggesting the same thing for gas stations to keep gas prices down, lol.

California has another confusing slate of initiatives on the ballot for the next election, including several related to various interventions in pharmaceutical pricing  (helping to demonstrate that grass roots democracy can be just as tyrannical to individual rights as any other form of government).  Bill Leonard, of the California BOE, notes in his weekly email:

Proposition 79 seeks to capitalize on public outrage over high drug prices by creating a new big government program that would supposedly mandate drug discounts for low-income Californians.

It turns out that the initiative contains a little-noticed provision that will allow private trial lawyers to sue drug companies for the new tort of "profiteering in prescription drugs."  Under this sneaky provision, which will be effective immediately even if the drug discount program is never implemented (Federal approval is required), drug makers would be prohibited from demanding "an unconscionable price" or demanding "prices or terms that lead to any unjust and unreasonable profit." These terms are not defined anywhere in the initiative or elsewhere in state or federal law, so your guess as to what these terms mean is probably as good as mine.  A violation of this new offense would carry a minimum fine of $100,000 or triple the amount of damages (whichever is greater) plus court costs and legal fees.  You can see why the trial lawyers love this initiative!  It is bad enough to have government bureaucrats setting drug prices, but imagine having drug prices set by randomly-selected jurors!

Can you imagine offering a product in a market and not knowing if your pricing was legal until after a jury trial?  Actually, until after multiple jury trials, since in cases like this there is effectively no restriction on being tried one, two, or ten thousand times for the same thing.  Not only will prices be set by a jury, but they will be set by the single most aggressive jury in what is sure to be an onslaught of trials.

In case you have any confusion or failure of imagination as to how poorly this will work out, California tort lawyers have slipped this same provision into other laws, notably the sue your boss over picayune labor code violations law and the Unruh Act, which allows lawyers to serially sue businesses for picayune technical violations of the ADA.  Here is an example of Unruh at work:

Molski, who lives in Woodland
Hills, has sued dozens of Central Coast businesses, from the Santa Ynez
Valley to Paso Robles, for alleged violations of the ADA. Among them
are Firestone, Fess Parker and Kalyra wineries in the Santa Ynez
Valley, Cambria Winery in northern San Luis Obispo County, and Fosters
Freeze restaurants in San Luis Obispo and Morro Bay.

A provision of California state law known as the Unruh Act allows Molski to demand $4,000 in damages per violation, per day.
                  

Molski
has said in the past that an average settlement is $20,000. He
testified in the Los Angeles trial that he personally nets an average
of $4,000 per settlement, after paying attorney's fees, Beardsley said....

As of Friday, 528 cases were listed under Molski's name in federal civil courts....
   

Also
fighting Molski in court is Harmony Cellars in northern San Luis Obispo
County. Winery owner Chuck Mulligan sees the L.A. decision as a good
sign, but isn't counting on winning.

"You
just never know. A jury trial is always a crap shoot," Mulligan said.
"I think the public sees through this whole quagmire that's going on.
They claim they are trying to do something for society but it's really
just pulling money away from society that could be used for jobs," and
other purposes, he said.
                   

Molski's
suit against the Hitching Post in Casmalia alleged a wheelchair ramp
was too steep, and the bathroom wasn't accessible because the toilet
was a half inch too close to the wall; and the sink was three inches
too high, and the soap dispenser was too high.
                   

Stricklin contends the bathroom is fully accessible.
                   

"Our
restaurant's accessible and has been for a long time. Our mother is in
a wheelchair. Of course it would be accessible," Stricklin said. "Every
customer we have that's disabled has gotten into our restaurant, and
we've never had a complaint."

"I've
talked to about five people in Solvang and Cambria who have been sued
twice in the last year," Stricklin said. "They're stuck. Unless you
close your doors, somebody else can come along and sue you, and that's
why we're fighting. If they can see that we're not going to roll over
and settle, they'll think twice about going to trial."

At least in the case of Unruh, there is a defined legal standard, even if suing for $4000 per day for violations of 1/2-inch are ridiculous.  Prop 79 would allow suits with no standards, except whatever a jury happens to come up with on a particular day.  And we all know how smart and thoughtful juries can be (from recent Vioxx case):

Jurors who voted against Merck said much of the science sailed right over their
heads. "Whenever Merck was up there, it was like wah, wah, wah," said juror John
Ostrom, imitating the sounds Charlie Brown's teacher makes in the television
cartoon. "We didn't know what the heck they were talking about."...

... [juror] Ostrom, 49, who has a business remodeling homes, was also disturbed
that former Merck Chief Executive Raymond Gilmartin and another top Merck
official gave videotaped testimony but weren't in the courtroom. "The big guys
didn't show up," said Mr. Ostrom. "That didn't sit well with me. Most definitely
an admission of guilt."...

One juror, Ms. Blas, had written in her questionnaire that she
loves the Oprah Winfrey show and tapes it. "This jury believes they're going to
get on Oprah," Ms. Blue told Mr. Lanier. "They only get on Oprah if they vote
for the plaintiff."

Previously, I made my own tongue-in-cheek suggestions for follow-ups to Unruh, but prop 79 may be worse than any of these:

So, I would like to propose my
own Unruh II law.  I propose that in California, every citizen now has
the right to sue any other person they observe violating any sort of
traffic law.  If you observe someone speeding, doing a rolling stop at
a stop sign, failing to signal a lane change or turn, with a burned out
tail light, not wearing a seat belt, jaywalking, etc, you may now sue
them for $4000 per occurrence. 

Coming in future posts, I will
propose Unruh III to empower citizens to sue over health code
violations, Unruh IV to empower citizens to sue over fire code
violations, and Unruh V to sue anyone for any reason if they have a net
worth higher than you do.

It strikes me that my suggestion for Unruh V is where we are really going.

Update: More bounty hunting here, via Overlawyered.

Truck and Barter is not very impressed with Bush's call for us all to drive less. 

I'd like to know just why I should conserve. We supposedly live in a
capitalist society based on property-rights and free-trade; why, all of a
sudden, do you ask that I not trust that the price of fuel incorporates all the
scarcities at every level of production? What economic lever broke in the past
month? Why do you think the price system is failing so bad that we need to
"conserve" more than the price signal warrants?

I won't pretend that market prices don't exist, or that markets have suddenly
stopped working; I won't pretend that prices are inefficient allocators of
resources; I won't pretend that I cannot buy as much gasoline as I can afford at
current prices.

Furthermore, Mr. President, I will not pretend that you have legal or moral
authority to tell me how much gasoline I may purchase. I will not pretend that
your feeble call to use less has any impact whatsoever on my psyche. I will not
pretend that the Federal Government knows better than me how much gasoline I
should purchase.

Awesome, well said.  Maybe if Bush had worn a cardigan, like Jimmy Carter did when he asked the same thing, he might have been more successful.  Or then again, maybe Bush should have thought twice about channeling Jimmy Carter on any energy or economics related issue.

By the way, there is much more to the post - make sure to read it all.

Update: This one attracted a number of comments fast.  Here are some additional thoughts

Doesn't it make sense to conserve gas?  Isn't what Bush said correct?

Sure it makes sense, but I didn't need Bush to tell me.  Seeing my average 15 gallon fillup go from $30 to $45 nearly overnight told me everything I needed to know.   I adjusted my driving behavior based on how I value various types of trips.  And so, apparently, did everyone else, as gas consumption in this country dropped almost 10%.  Bush doesn't have to tell you to refinance your home when mortgage rates drop, or to buy less OJ when the orange crop failed -- prices signal these things quite nicely.

By the way, I limited my driving years ago (e.g. I live 1 mile from my office) but not because of gas prices.  Lets say 1 hour of driving gets me 30 miles in the city, and requires 1.5 gallons of gas.  The recent increase in gas prices has increased the cost of that 1 hour of driving by about $1.50.  That is NOTHING compared to how I have increased how I value my free time as I have grown older.  That hour may use up five bucks of gas but hundreds of dollars of my leisure time.  I have often told people that the biggest change you go through getting older is how much your internal valuation of your own free time goes up.  In college, I would wait for 8 hours in a line to get concert tickets at face value.  Today, I buy them market up at eBay, because that 8 hours is now worth far, far more to me than the markup.

Wouldn't voluntary conservation beyond what you have already cut back help reduce gas prices in the US?

Sure, if everyone cut back some percentage more than what they would have already done due to the price increase, then yes that might help push prices down.  Of course every person who did this would lose from doing so.  When the price increases, everyone eliminates their marginal use of gasoline, ie every use or trip that is worth less to them than the cost in fuel.  That means that the trips that remain are worth more to them than the gas (and other)  costs.  Therefore, remaining trips are a net increase to their well-being.  If a remaining trip is then eliminated voluntarily, or the cost of that trip is increased due to the increased hassle of carpooling or using public transit, then their well-being is reduced. 

However, this is the great thing about America:  If you personally value voluntarily reducing your gas consumption to help reduce prices for others, in a free society, no one is going to stop you.

By the way, here is the reason I don't worry about it:  I am old enough to have been driving in the late 1970's.  And I know from experience that allowing prices to shoot up for a period of time, without government price caps or windfall profit confiscation silliness, is going to lead to more supply and lower prices in the future.

Don't you think its unethical not to conserve in times like this?

No.  I don't associate consumption and ethics.  If it is sold legally at a certain price, and I can afford and wish to pay that price, then I don't see that morality or ethics come into play.  While there certainly can be ethical problems spending money unwisely (e.g. blowing money on coke or gambling that was needed to feed your kids), that is a different situation.  I don't feel guilty about consuming gas.

Isn't it a security issue?  Shouldn't we be asked or forced to conserve more to make the US independent of foreign oil?

There is only one time this argument makes any sense - if the world is in a full scale shooting war and all foreign trade and international markets are halted, and then we would have much bigger problems.

Short of the breakdown of world trade and markets, being "independent of foreign oil" is a mirage, an impossible non-goal.  Lets say that the world energy supply and demand was exactly the same as it was today, except that the US produced domestically exactly enough oil to satisfy domestic demand.  But in this case there is still a world market for oil.  The price of oil and gas in this country would not be more or less than it is today, except maybe for a few cents of transportation cost differences.  And if there is an oil supply shock, the pricing in the US will be virtually the same in this hypothetical situation as it would be in today's structure.

Shouldn't the President be doing something?

Sure.  Get the hell out of the way of the people who can fix the problem.  Rethink the regulatory regime that is preventing refinery construction.  Revamp the licensing approach for nuclear power.  Open up oil drilling in proscribed areas.  And find his lost veto pen and ax any dumbshit regulation out of Congress managing energy prices, taxing windfall profits, or attempting to pick winners via subsidies.

Technorati Tags:  Energy, Economics

Yes, it has a stake in its heart along with a couple of silver bullets, but a number of members of Congress are attempting to reanimate the broadcast flag.  I celebrated its demise here, perhaps prematurely.  I am sad to say that my Congressman John Shadegg, according to Boing Boing, seems to be among the twenty Frankensteins responsible for this effort.  I have given props to Shadegg a couple of times, and now I have to express my deep disappointment in him.

I know, I know. We keep killing
this thing, and it keeps on coming back. But the important thing is
that we keep killing it. Us. They put tens of millions of bucks into
this bid to make technology subservient to the superstitious fantasies
of venal film execs, and we killed it by sending thousands and
thousands and thousands of letters, calls, and faxes to DC. We made it
happen. We'll make it happen again. They're not going to win this one,
EVER

Frequent readers of this blog, all 12 or so of them, are probably tired of my recent obsession with Katrina examples of how government values control over results (posts here, here, here, here, here, and here, lol).  So I will let someone else say it now:

There has been a lot of political and ideological discussions surrounding
Katrina. Clearly the political sector handled the disaster with great
inefficiency. Yet many people, including (as usual) most of the media, seem to
believe government failure somehow proves we need bigger government.

This is an odd conclusion. If the voluntarily sectors (market and civil
society) fail we hardly conclude that government must shrink. To put it another
way, if Katrina had been handled with great efficiency by the state the same
people would conclude this was an argument for even stronger government. But now
the exact opposite is also taken as meaning we need greater government. I am
curious to know if there is any world development the NYT does not see as
evidence for expanding the welfare state, at the expense of individuals and of
the civil society.

There is much more, from Truck and Barter.

The FEC is suing the Club for Growth for campaign finance violations, basically arguing that they are controlled by the Republican Party and therefore not an independent political group (or whatever, I can't really be bothered to understand just what argument the FEC is using to trash the First Ammendment).

So I have Exhibit #1 for the trial.  Yesterday I published a blog piece blasting the Republican Party, concluding:

The Republicans are lost.  Combine this kind of spending with their
Patriot Act and Sarbabes-Oxley driven Big-Borther-Is-Watching
intrusiveness, luke-warm committment to free-trade, and bizarre , and I find nothing at all attractive about the party.  Only the economic insanity of the opposition party continues to keep Republicans in power.

If the Club for Growth is a subsidiary of the Republican Party, then why are they linking my post today from their home page? 

Cafe Hayek has a fabulous fisking of Missouri governor Matt Blunt's letter to the editor explaining why his call for price controls on gasoline is consistent with his free market principals.  Its all good, I can't pick out any one quote.  Read it all.

But wait!  This just in!  Maybe our governor IS this dumb.

Our great benevolent leader, Janet Napolitano, has stated in press conference
the she is going to investigate these fuel prices of ours. Mostly she was
ruffling her feathers right after Hurricane Katrina shutdown a good 30% of the
domestic supply source. So of course prices increased slightly to account for
the lack of supply. This trend that followed exactly what even very simple
supply and demand theory would predict was not enough to convince miss Gov. J.No
not to call for yet another investigation. No way! She was not going to be
swayed by facts, reality or "assurances from the oil industry" that these were
fair market prices. Nope. An investigation was needed.

A little over a year ago, a pipeline broke and the only source of gasoline into Phoenix was stopped.  Due to EPA regulations, Phoenix requires a special gas blend made in only one refinery coming to us through one pipeline, so it is not surprising that if that source is interrupted, gas might be short here for a while and prices might spike up.  Which they did.  Governor Napolitano at that time blamed the whole situation on the oil industry and called for investigations.  Tellingly, she took only three policy actions:

• Temporarily waived regulations for a special blend of gas in Phoenix
• Temporarily waived regulations on truckers that were preventing them from filling in for the broken pipeline
• Considered circumventing regulations that were preventing a local refinery to serve the Phoenix market from being built.

So the rhetoric at the time was "its all the oil companies faults" but the solution was "repeal government regulations".  Hmmmmm.  By the way, the Commons Blog created a nice chart showing how those filthy rich oil companies are making, uh, ahem, lower profits than average for US industry (click to enlarge).  I wish they were more profitable- we would probably have a lot more oil.

Following up on posts here, here, here, here, and here is yet another in a series on government preference for control over results, this time via Overlawyered.com:

In the midst of administering chest compressions to a dying woman
several days after Hurricane Katrina struck, Dr. Mark N. Perlmutter was ordered
to stop by a federal official because he wasn't registered with the Federal
Emergency Management Agency. "I begged him to let me continue," said Perlmutter,
who left his home and practice as an orthopedic surgeon in Pennsylvania to come
to Louisiana and volunteer to care for hurricane victims. "People were dying,
and I was the only doctor on the tarmac (at the Louis Armstrong New Orleans
International Airport) where scores of nonresponsive patients lay on stretchers.
Two patients died in front of me.

"I showed him (the U.S. Coast Guard official in charge) my medical
credentials. I had tried to get through to FEMA for 12 hours the day before and
finally gave up. I asked him to let me stay until I was replaced by another
doctor, but he refused. He said he was afraid of being sued. I informed him
about the Good Samaritan laws and asked him if he was willing to let people die
so the government wouldn't be sued, but he would not back down. I had to
leave."

In a formal response to Perlmutter's story, FEMA said it does not accept the
services of volunteer physicians:

"We have a cadre of physicians of our own," FEMA spokesman Kim Pease
said Thursday. "They are the National Disaster Medical Team. ... The voluntary
doctor was not a credentialed FEMA physician and, thus, was subject to law
enforcement rules in a disaster area."

So for those of you who draw the conclusion from Katrina that we need more big government rather than less, that would help.... how?

Technorati Tags:  Katrina

From the Mises Blog:

For those who maintain that the government "failed" its "mission," I must say
that they are wrong. True, the government with its ham-fisted policies of
blocking relief missions, imposing price controls, and acting in a dictatorial,
but incompetent style, seems to have "failed" in making things better,
especially in the days directly after the storm passed. But, if you understand
that government is a mechanism by which some people impose their will by force
over others, then you would have to admit that the government succeeded and
succeeded beyond its own expectations.

Thus, I leave readers with this question: If you believe that the government
"failed" in the aftermath of Katrina, will the government then have less or more
"authority" when the next disaster strikes? I think all of us know the
answer.

You can always expect government to behave exactly like government. When you
consider your political position, consider whether this institution ought to be
put in charge or disaster relief at all, or the economy, or society, foreign
policy, health care, education, courts, the environment or anything at all.
Katrina and its aftermath is only the latest exhibit in the ongoing historical
documentary in favor of a government-free society

I had similar thoughts here and here.

I have never been a Richard Branson groupie, but I must say for once I am appreciative of his efforts.  Branson has helped to make crystal clear the process by which governments take control of the economy.  The story comes to us via the Mises Economics blog, and starts this way:  According to Branson:

"The big oil companies are making extortionate profits out of the current oil
price," he announced, in his most calculating, populist style.

How anyone who runs the Virgin Megastores can complain about someone else's high pricing is beyond me, but lets let him run a little further:

"The biggest problem with the oil price is the lack of refinery capacity. There
is enough oil for everyone in the world, but the refineries are just not there."

And they are not there because...governments do not allow oil companies to build new refineries.  The government having created the problem, the solution would seem to be for the government to repeal the offending restrictions that caused the problem.  But here is where we get to the great tool of statism:  The problem created by the government is blamed on private enterprise and "market failure" and portrayed as necessitating... more government intervention:

"There has been talk of a windfall tax on big oil companies. Perhaps the
Government should use that money to invest in refinery infrastructure."

Of course, the big oil companies would invest those windfall profits in refining capacity on their own had they been allowed by government, but lets ignore that messy detail.  Ahh, but here is the best part.  Not only does the government now get to invest in refineries, but it gets to do it by channeling the money to the political supporters (i.e. Branson) of those in power, thus cementing their power and control.

According to the paper, Britain's favourite "entrepreneur" aims to put $100
million behind his latest scheme to build an oil refinery for airline fuel. Yes,
the Bearded Wonder is said to be about to launch a new company called - you
guessed it! - "Virgin Oil" within four or five months and is "seeking to attract
funding from other airlines and the Government...."

But, not content with this, our man from the tropical paradise has scented an
easier mark, for Sir Richard has seemingly exploited the crass celebrity-worship
of our New Labour masters, while also playing up to our ineffable Chancellor's
ever present desire to meddle in the markets.

For those of you who have held up Branson as some archetype of entrepreneurship: Stop it.  Here you see a man who is attempting to finance his entry into an industry by getting the government to take money by force from the current competitors in that industry and to give it to him to finance his startup.  I have always suspected Branson of being from the Orrin Boyle school of business and this just proves it.

Technorati Tags:   Economics

This was funny, from labor boss John Sweeney (via Cafe Hayek):

Let's require big, profitable companies such as Wal-Mart to provide health care
to their employees instead of passing the cost along to everybody else, and
let's begin to develop a national health care plan that provides affordable
coverage to all Americans.

This is really, really funny.  Notice that in the first half of the sentence, he decries passing health care costs "along to everybody else" and then in the second half advocates a national health insurance plan that would pass individual health care costs onto... everybody else.  Also note that since Wal-mart, despite Mr. Sweeney's description as being big and profitable, has one of the lowest profit margins in the Fortune 100, it would likely have to raise prices in order to... pass these costs along to everybody else.

What Mr. Sweeney is actually frustrated about is that there are a large number of individuals in the labor force that he does not make decisions for and who do not in turn contribute to his personal power.

Cafe Hayek has more.

Advocates of the statist web of regulation in California argue that this mass of government control makes California a more desirable place to live.  Andy Roth asks, does it?

Some high income earners are
leaving California because of its punitive tax rates. Could low- and
middle-income workers be leaving as well? One crude measure is to examine the
one-way rental rates for U-Haul vans. Using U-Haul's website, I queried a one-way rental for a 10-foot van
for October 1st, 2005.

   
   
   
   
   
   

One-Way Trip	Price
Los Angeles to Las Vegas	$454.00
Las Vegas to Los Angeles	$119.00

Well, our most socialist state is attempting to repeal the laws of supply and demand:

Hawaii issued a list of wholesale price caps for gasoline, the
state Public Utilities Commission said, amid this month's
record-breaking run up in retail gas that saw island residents paying
some of the highest prices in the nation.

This marks the first state cap on gasoline prices since the 1970s
energy crisis, when the average inflation-adjusted price of a gallon of
regular unleaded hit $3.

Hawaii's recently enacted gas cap law goes into effect on September 1, with the pre-tax wholesale cap in Honolulu set at $2.1578

Gee, I bet this will work out really well.  Either the price cap will be set high, such that it is meaningless, or it will be set low, such that Hawaii will likely get this:

update:  given the structure of the price caps, the result could actually be higher rather than lower prices at the pump -- see update #2 below.

It's good to know that Hawaii is looking to China for economics ideas.

The Chinese government and its state-owned oil companies are locked
in battle over artificially low gasoline prices at the pump that has
caused a massive shortage in the southern manufacturing province of
Guangdong....

The crisis
highlights the persistent problems Beijing faces as the economy is
transformed to a more market-based system but that is often retarded by
authorities who fear loosing political control in the face of
full-fledged capitalist rules.

Beyond the obvious run-up in world-wide oil prices and Hawaii's logistical isolation that raises all of the prices on the island, the article on CNN identified one other possible culprit for high prices: the state government

Higher-than-average taxes on gasoline in Hawaii contribute to those
high prices. The state levies a 16 cent per gallon tax, and various
local authorities add on other taxes.

In Honolulu, for example, total state, federal and local gas taxes
amount to about 53 cents per gallon, one of the highest rates in the
United States. The national average, according to the American
Petroleum Institute, is about 42 cents per gallon

It seems like only a few days ago I was pointing how governments have a hard time resisting meddling in oil markets, and that this meddling never works out well.

Even in the US, which is typically more comfortable with the operation
of the laws of supply and demand than other nations, the government has
been loathe to actually allow these laws to operate on oil.  During the
70's, the government maintained price controls that limited demand side
incentives to conserve, thus creating gas lines like the ones we are
seeing in China today for the same reason.  When these controls were
finally removed, a "windfall profits tax" was put in place to make sure
that producers would get none of the benefit of the price increases,
and therefore would have no financial incentive to seek out new oil
supplies or substitutes.  Within a few years of the repeal of these
dumb laws, oil prices fell back to historical levels and stayed there
for 20 years.

Like the gas rationing and price controls in the 1970's, this occurs in a Republican administration (Hawaiian Governor Lingle).  It continue to be difficult to take the Republican Party's professed support for free markets seriously.

Hawaii's Star Bulletin reported that Governor Linda
Lingle (R) is an opponent of the caps. The newspaper said Lingle
believes it would be better to force oil companies to open their books
and show consumers how much money they make at each stage of business.

If she is so opposed to it, why didn't she veto the bill?  And is having government officials marching into private offices to confiscate accounting data really her preferred "free market" alternative?

Update:  Apparently the cap in Hawaii was passed pre-Lingle, and she fought to reverse it, so I will cut her some slack. Lynne Kiesling has more details on the plan, which includes how the cap will be calculated week to week.  Politicians there are calling it a "market-based price cap".  LOL.  Next we will see freedom-based speech limitations and privacy-based telephone taps.  Note that how the cap is calculated does not change the statement I made before:  Either the price cap will be set high, such that it is meaningless, or
it will be set low, such that Hawaii gets gas lines.

PS- Lynn is the economic goddess of energy markets, so if energy and power markets and regulation interest you, I recommend her blog.

Update #2:  Jane Galt makes the good point that the Hawaiian price caps are on wholesale gasoline prices, so while there may be gas shortages at the wholesale level, retail prices may be able to float higher to close the supply gap.  This would ironically lead to higher, not lower prices at the pump, and large profits for gasoline retailers.  Since wholesale sources of gas tend to be out-of-state corporations, and gasoline retailers tend to be smaller, locally owned businesses, I wonder if this is a case of rent-seeking by gas station owners.

I won't go too much into the details of the recent Vioxx jury verdict.  Professor Bainbridge has a complete roundup which is worth reading, and Reason had an analysis of the merits of the case a while back.  Though its not really the point of this post, I can't resist a few snippets:

Jurors who voted against Merck said much of the science sailed right over their
heads. "Whenever Merck was up there, it was like wah, wah, wah," said juror John
Ostrom, imitating the sounds Charlie Brown's teacher makes in the television
cartoon. "We didn't know what the heck they were talking about."

One juror considered the fact that the CEO, whose company faces thousands of law suits, didn't show up as an admission of guilt:

... [juror] Ostrom, 49, who has a business remodeling homes, was also disturbed
that former Merck Chief Executive Raymond Gilmartin and another top Merck
official gave videotaped testimony but weren't in the courtroom. "The big guys
didn't show up," said Mr. Ostrom. "That didn't sit well with me. Most definitely
an admission of guilt."

And of course there is this now famous gem:

One juror, Ms. Blas, had written in her questionnaire that she
loves the Oprah Winfrey show and tapes it. "This jury believes they're going to
get on Oprah," Ms. Blue told Mr. Lanier. "They only get on Oprah if they vote
for the plaintiff."

Read the Bainbridge post, it has much more.

Anyway, the point of this post is that this verdict represents a very dangerous assault on individual choice.  Recognize that there are many, many activities in life where individuals are presented with the following choice:

If I choose to do X, my life will be improved in some way but I may statiscally increase my chance of an early death.

You may react at first to say that "I would never risk death to improve my life", but likely you make this choice every day.  For example, if you drive a car, you are certainly increasing your chance of early death via a auto accident, but you accept this risk because driving allows you to get so much more done in your life (vs. walking).  If you ride a bike, swim, snow ski, roller blade, etc. you are making this choice.  Heck, everyone on the California coast is playing Russian Roulette with an earthquake in exchange for a great climate, beautiful scenery, and plentiful jobs.

The vast majority of drugs and medical therapies carry this same value proposition:  A drug will likely improve or extend your life in some way but carries a statistical chance of inducing a side effect that is worse than the original problem, up to and including death.  The problem is that we have structured a liability system in this country such that the few people who evince the side effects can claim more money in damages than the drug was worth to all the people it helped.  For example, if a drug helps 999 people, but kills the thousandth, and that thousandth person's family is awarded $253 million in damages (as in this case), the drug is never going to be put on the market again.  Even if the next 1000 people sign a paper saying we are willing to take the one-in-a-thousand risk to relieve the pain that is ruining our lives, they still are not going to get the drug because the drug companies know that some Oprah-loving jury will buy the argument that they did not understand the risk they were taking and award the next death another quarter of a billion dollars.

This exact same effect nearly killed the vaccination industry.  In the end, Congress had to pass legislation  immunizing (ha ha) vaccine makers from lawsuits when known 1-in-10,000 side effects occur.  While I am not a big fan of the FDA, if it is going to exist and put drugs through 20 years of tests and a forest full of paperwork to get approved, I think that approval process should confer some sort of litigation immunity. 

By the way, have you noticed the odd irony here?  Robert Ernst (the gentleman who died in the Vioxx case) is assumed, both by the FDA and the litigation system, to be unable to make informed decisions about risk and his own health.  But a jury of 12 random people who never experienced his pain can make such decisions for him?  And us?

Richard Epstein said it better than me, in the WSJ but I will like to Reason which is free:

I would like to send my message to [plaintiff's lawyer Mark] Lanier and
those indignant jurors. It's not from an irate tort professor, but from
a scared citizen who is steamed that those "good people" have imperiled
his own health and that of his family and friends. None of you have
ever done a single blessed thing to help relieve anybody's pain and
suffering. Just do the math to grasp the harm that you've done.

Right now there are over 4,000 law suits against Merck for Vioxx.
If each clocks in at $25 million, then your verdict is that the social
harm from Vioxx exceeds $100 billion, before thousands more join in the
treasure hunt. Pfizer's Celebrex and Bextra could easily be next.
Understand that no future drug will be free of adverse side effects,
nor reach market, without the tough calls that Merck had to make with
Vioxx. Your implicit verdict is to shut down the entire quest for new
medical therapies. Your verdict says you think that the American public
is really better off with just hot-water bottles and leftover aspirin
tablets.

Ah, you will say, but we're only after Vioxx, and not those good
drugs. Sorry, the investment community won't take you at your word. It
realizes that any new drug which treats common chronic conditions can
generate the same ruinous financial losses as Vioxx, because the flimsy
evidence on causation and malice you cobbled together in the Ernst case
can be ginned up in any other. Clever lawyers like Mr. Lanier will be
able to ambush enough large corporations in small, dusty towns where
they will stand the same chance of survival that Custer had at Little
Big Horn. Investors can multiply: They won't bet hundreds of millions
of dollars in new therapies on the off-chance of being proved wrong.
They know they'll go broke if they win 90% of the time.

Your appalling carnage cries out for prompt action. Much as I
disapprove of how the FDA does business, we must enact this hard-edged
no-nonsense legal rule: no drug that makes it through the FDA gauntlet
can be attacked for bad warnings or deficient design.

I get email and comments from time to time that my language deriding government's intervention into every aspect of our lives is overblown and exaggerated.  My answer:  Oh yeah, well how about this:

Mike Huckabee, the Governor of Arkansas, now
requires annual fat reports. These are sent to the parents of every
single child aged between 5 and 17; a response, he says, to "an
absolutely epidemic issue that we could not ignore" in the 1,139
schools for which he is responsible.

I just cannot craft any reasonable theory of government where this is the state's job.   The "obesity" crisis in this country just amazes me.  "Experts" every few years broaden the definition of who is overweight or obese, and suddenly (surprise!) there are more people defined as overweight.  Even presuming it is the state's job to optimize our body weights, is it really the right approach to tell everyone they are too fat?  Having known several people who were anorexic, including at least one young woman who died of its complications, is it really a net benefit to get young people more obsessed with looks and body style?  And what about the kids that are genetically programmed to be overweight?  Does this mean that years of taunting and bullying by their peers is not enough, that the state's governor wants to pile on now?

It is interesting to note that governor Huckabee apparently started this initiative after his own personal battle with weight loss:

[Huckabee] lost 110lb after being warned that his
weight, more than 280lb after a life of southern fried food, was a
death sentence. A chair even collapsed under him as he was about to
preside over a meeting of state officials in Little Rock.

We all have friends who have lost weight or gotten into homeopathy or became a vegan and simply cannot stop trying to convert their friends now that they see the light.  Now we have the spectacle of elected officials doing the same thing, but on a broader scale and with the force of law, rather than  just mere irritation, on their side.  One can only imagine what report cards kids would be carrying home if Huckabee had instead had a successful experience with penis enlargement.  What's next, negative reports for kids with bad acne?  For women whose breasts are too small?  For kids who are unattractive?

As I have argued many times in the past, a large part of the blame for these initiatives is public funding of health care.  Beyond the efficiency and choice arguments, I have tried to point out that publicly funded health care is a Trojan horse for a number of truly intrusive nanny-state government controls of our lives.

It isn't such a stretch to imagine the effect
when people realise "” as residents of Arizona have been told already "”
that about 40 per cent of their healthcare charges are spent treating
the consequences of avoidable obesity.

When health care is paid for by public funds, politicians only need to argue that some behavior affects health, and therefore increases the state's health care costs, to justify regulating the crap out of that behavior.  Already, states have essentially nationalized the cigarette industry based on this argument.

By the way, I am willing to make a bet with anyone that no where near 40% of our healthcare charges in Arizona are due to obesity.  I am positive some advocate made up this number, or created it using some ridiculously broad assumptions, and it has now been swallowed by the credulous and scientifically-illiterate press.

Update: Wow, the solution to obesity!  Government funded shrubbery:

City dwellers living in areas with little greenery and high levels of
graffiti and litter are more likely to be obese than those living in
pleasant areas with lots of greenery, say researchers in a study
published on bmj.com today.

Reason number 6,345 not to ever take "facts" from a "study" reported in the media at face value.

Update #2: More about the health care as a trojan horse for statism  (emphasis added)

BangkokThe World Health
Organization (WHO) has always had a rather expansive notion of what it
means to be healthy. If one looks at the official definition it defines
health as a "state of complete physical, mental and social well-being
and not merely the absence of disease or infirmity." According to that
understanding there isn't much that is not in some way connected with
health.  And for the health promoters at WHO's recently completed Bangkok conference that means that health is the supremely important value that trumps everything else.

After
all, the health promoters argue, it is surely obvious that health is a
necessary condition for any sort of life, so it must follow that for
any truly rational person health must outweigh any other value that
might conflict with it. But the "obvious" -- especially the obvious of
the health promoter -- is often likely to be untrue. While it may be
true that being alive is in some not very interesting sense necessary
for having a life, it is not at all true that being "healthy,"
especially as defined by WHO, is a necessary condition for having a
good life.

 

All
of us make trade-offs between optimal health and other values all of
the time. We travel by car for instance, for reasons of economy or
convenience, even though we might recognize that statistically planes
are safer. We smile at Alan Dershowitz's cardiac calculus where a
patient chooses between ten years of inactive life and the risk of
sudden death:

 

"My
doctor has made a prognosis/That intercourse fosters thrombosis/But I'd
rather expire/Fulfilling desire/Then abstain, and develop neurosis."

As most of you know, Andy Warhol once predicted that "In the future, everyone will be world-famous for 15 minutes."  The statement seems eerily correct given the explosion of talk shows and reality TV, which mainly happened after his statement.

I would like to follow-up on Mr. Warhol's bold prediction with one of my own:

In the future, everyone will be on the TSA's no-fly list

The TSA has the ridiculous policy of stopping everyone with a similar name as a single terrorist subject.  So, once a John Smith comes under scrutiny as a possible terrorist, every John Smith gets turned away at the gate. 

Sarah Zapolsky's 1-year-old son had better get used to being looked at as a
possible terrorist every time his family gets on a plane.

That's because experts and officials say there's no way the toddler's name
will be taken off the federal no-fly list - even after he and another tot made
headlines for being stopped as potential terror threats.

"His name is the same or similar to someone on the no-fly list," said Ann
Davis, a spokeswoman for the Transportation Security Administration, explaining
that even though a baby is not a threat, someone out there with the same name
is, and the name must be kept on the list.

Hat tip to Hit and Run.