Coyote Blog

I have stayed away from the story about Hollywood producer/director James Cameron backing out of a climate debate at the last minute, a debate he demanded and previously had thumped his chest that he would win going away.  The event in Aspen was being run and attended by folks totally sympathetic to Cameron and completely hostile to the skeptic's position.  The event's founder and producer Chip Comins is almost defamatory in how he talks about skeptic Mark Morano, who was to debate Cameron and was actually on a plane flying to the event when Cameron backed out.  Its amazing that Morano would agree to debate in such a hostile environment with a biased organizer, but in fact it was Cameron who chickened out.  This statement by Comins tells you all you need to know about Hollywood culture:

"Morano is not at James Cameron's level to debate, and that's why that didn't happen," Comins said. "Cameron should be debating someone who is similar to his stature in our society."

This is an analysis from Denmark's Labor Market Commission. There are many people who simply stay on unemployment as long as they can.

Here is a chart I ran a while back on auto sales, showing how the cash for clunkers "stimulus" program simply spent a bunch of money to pull forward car sales by a month or two

Here are housing sales -- I don't have time this morning to annotate the chart but the housing stimulus program expired in May

Yes, I am among the geeks who miss Omni magazine.  Is there anyone who remembers a short story in that magazine about a traffic jam so bad they eventually just paved it over, people and all?  I am reminded of that given this story from China.

I had not realized that some Federal employees did not have to participate in Social Security.  Intriguingly, this fact was raised by people who were defending government pay as not being excessive -- they said something like, "well, some workers don't even get Social Security."  Via Bryan Caplan

Some government employees don't participate in Social Security. How does that change the benefits picture?

[T]hat's irrelevant because they're neither paying nor receiving benefits. If you follow Social Security, you know it pays a low rate of return... [N]ot to participate in Social Security is actually a benefit, because they're keeping more.

I agree. Not participating in Social Security is a huge benefit.  The implicit return on "premiums" paid by you and your employer is typically below zero.  In other words, if you took your social security taxes and stuffed them in a mattress, you would get a better return.  As I wrote in the link above

as a retirement program, [social security] is a really, really big RIPOFF.  Ever worker in this country is being raped by this retirement plan.  In fact, it is the worst retirement program in the whole country:

• As we see above, it pays a negative rate of return
• It is not optional "“ you go to prison if you choose not to participate
• Unlike a private annuity contract, the government can rewrite your benefits level any time, and you have to take it.  In fact, my statement says "Your estimated benefits are based on current law.  Congress has made changes to the law in the past and can do so at any time.  The law governing benefit amounts may change because, by 2040, the payroll taxes collected will be enough to pay only about 74 percent of scheduled benefits."
• There are no assets backing this annuity!!  An insurance company that wrote annuities without any invested assets backing them would be thrown in jail faster than Jeff Skilling.  The government has been doing it for decades.

I must say that I am not much of a fan of trying to find spurious relationships between long-term economic trends and the political parties who hold office at various times.  But I must say I kind of liked this one from Mark Perry:

PS-  I was around a dinner table this weekend with a group of Republicans, including some activists.  I asked them what exactly they thought Republicans would do next term if they won real gains in Congress.  None of them, many hard-core activists, could name anything except divide government and slow the pace of growth.  Which I suppose is better than we have now.

Maybe its because I live in Phoenix, but the local food movement has always seemed silly to me.  To somehow argue that food grown in our 6 inches of annual rainfall is better for the environment than trucking product in from more suitable growing regions has always struck me as crazy.  Russ Roberts links several good articles on the local food movement, one of which included this nice snarky observation:

The result has been all kinds of absurdities. For instance, it is sinful in New York City to buy a tomato grown in a California field because of the energy spent to truck it across the country; it is virtuous to buy one grown in a lavishly heated greenhouse in, say, the Hudson Valley.

The government terminology that tends to tick me off the most is calling commerce a "privilege" that can only be granted to the state and therefor must be licensed with appropriate tribute paid to the state for the "privilege."  Here in Arizona our sales tax is called a "transaction privilege tax."  Here is a story about licensing bloggers in Philly:

Between her blog and infrequent contributions to ehow.com, over the last few years she says she's made about $50. To [Marilyn] Bess, her website is a hobby. To the city of Philadelphia, it's a potential moneymaker, and the city wants its cut.

In May, the city sent Bess a letter demanding that she pay $300, the price of a business privilege license.

Selling one's labor, and conducting commerce to the mutual interest of two parties are fundamental rights rather than artificial constructs granted by the state.

One substantial problem with the TSA that is seldom discussed is that in the switch from using private security to government agents to screen passengers, there was always going to be a temptation by the Feds to expand the airport screening from narrowly a search for weapons that might endanger an airplane to a catch-all crime search point.  Here is an example of the latter:

That same screener started emptying her wallet. "He was taking out the receipts and looking at them," she said.

"I understand that TSA is tasked with strengthening national security but [it] surely does not need to know what I purchased at Kohl's or Wal-Mart," she wrote in her complaint, which she sent me last week.

She says she asked what he was looking for and he replied, "Razor blades." She wondered, "Wouldn't that have shown up on the metal detector?"

In a side pocket she had tucked a deposit slip and seven checks made out to her and her husband, worth about $8,000.

Her thought: "Oh, my God, this is none of his business."

Two Philadelphia police officers joined at least four TSA officers who had gathered around her. After conferring with the TSA screeners, one of the Philadelphia officers told her he was there because her checks were numbered sequentially, which she says they were not.

"It's an indication you've embezzled these checks," she says the police officer told her. He also told her she appeared nervous. She hadn't before that moment, she says.

She protested when the officer started to walk away with the checks. "That's my money," she remembers saying. The officer's reply? "It's not your money."

At this point she told the officers that she had a good explanation for the checks, but questioned whether she had to tell them.

"The police officer said if you don't tell me, you can tell the D.A."

Patrick at Popehat observes how a media outlet probably missed the fact that they were hearing sarcasm.  But there is a very good explanation of why sarcasm does not work on the web.  Think of a couple of sarcastic comments, like "Boy that Joe Arpaio is sure a friend of civil rights" or "wow, that Cynthia McKinney is one sharp legislator."  The problem is that on the web, there are likely any number of people arguing, quite seriously, that Arpaio is the greatest friend the Constitution ever had or that McKinney is a bastion of well-reasoned, sober deliberation.  We are getting to the day that without regularly reading an author on the web, it is virtually impossible to be sure a given remark is sarcasm.  I mean, if I didn't know where he stood politically, I would have initially pegged Kevin Drum's assertion that Tip O'Neil cut a deal to have poor people pay the taxes of rich people as some sort of clever joke.

I believe it is time for a public information notice reminding everyone the actual text of the First Amendment as it applies to speech:

Congress shall make no law ... abridging the freedom of speech

It does NOT say:

No citizen may ever experience any negative consequences from their speech

This is the reason the reminder seems necessary

From Kevin Drum

Bob Somerby is following the latest Social Security chatter and hopes that Paul Krugman can explain how the trust fund works in an understandable way:

The trust fund is just an accounting fiction "” a pile of worthless IOUs! Generations of voters have been misled by such skillfully-wrought presentations.

....Krugman is our most valuable player by far "” our only player at the top of the press corps. Can he disentangle the trust fund scam in a way average people will understand? We don't know, and it isn't his job; no player should be expected to carry the ball on every play from scrimmage. Tomorrow, we'll offer our own ideas at how the "there-is-no-trust-fund nonsense" might best be approached, in a way average people can follow.

Well, hell, I'll take a crack at it. Here's the simple version.

In 1983, when we last reformed Social Security, we made an implicit deal between two groups of American taxpayers. Call them Groups A and B. For about 30 years, Group A would pay higher taxes than necessary, thus allowing Group B to reduce their tax rates. Then, for about 30 years after that, Group A would pay lower taxes than necessary and Group B would make up for this with higher tax rates.

This might have been a squirrelly deal to make. But it doesn't matter. It's the deal we made. And it's obviously unfair to change it halfway through.

This is an incredible fantasy.  Absolutely no one thirty years ago (Drum dates the "deal" to 1983) explicitly or even secretly crafted any such deal.  Seriously, is Drum really positing that a Democrat-dominated Congress led by for-god-sakes Tip O'Neil really said "lets have poor people pay some of rich people's taxes for thirty years?"  Just last night I was reading a quote from Hitler late in WWII that asserted he actually let the British escape from Dunkirk on purpose because he wanted the British to know he had no real quarrel with them.  While it certainly is true Hitler never really wanted a war with Britain, this is just a self-serving rewrite of history.  Drum is doing the same thing.  Its amazing to me that an obviously intelligent person can convince himself of this.

Here is the real, simple explanation of the Social Security trust fund:  Social Security was spinning off huge piles of money and no Congress person of either the Coke or the Pepsi party could resist grabbing it and spending it in a way that would support their reelection.  They ended up spending it all.  Every bit of it, all gone.  The Social Security trust fund is the Enron 401K plan stuffed with Enron stock.

Drum gets to his bizarre theory because he believes the fiscal discipline problem over the last 30 years was all due to tax cuts rather than spending, and that all these tax cuts were for rich people.   Of course, throughout the last 30 years, the share of taxes paid for by the rich have steadily risen, so the claim is absurd on its face, but the false assumptions it is built on are ones that every progressive accept as holy writ.

This paragraph is particularly a howler:

The physical embodiment of this deal is the Social Security trust fund. Group A overpaid and built up a pile of bonds in the trust fund. Those bonds are a promise by Group B to repay the money. That promise is going to start coming due in a few years, and it's hardly surprising that Group B isn't as excited about the deal now as it was in 1983. It's never as much fun paying off a loan as it is to spend the money in the first place.

It would be some exercise to try to define groups A and B in a non-overlapping manner.  The fact is everyone is in group A, as almost everyone overpays into Social Security on a return on capital basis -- the retirement income most people get represents generally a negative net ROI on the "premiums" paid.  And it is amazing to me that I have never heard that we now have government bonds that must be paid back only by a specific sub-section of the population.  It may very well have been a progressive assumption that only rich people would be on the hook for every dollar of government debt run up over the last 30 years, but that fact will likely be a surprise to just about everyone else in the country.  Here is his conclusion:

But pay it off they must. The rich have been getting a loan from the middle class for decades...

Delusional.

It appears that for a principled defense of property rights, the exercise of religion in America, and limited government we have to turn to ... liberal blogger Kevin Drum

We already know that a large majority of Americans are opposed to building it, but here are the results of an Economist poll on a slightly different question:

Whether or not you think the Islamic cultural centre and mosque should be built near the World Trade Center site, do you think that Muslims have a constitutional right to build a mosque there?

Technically, I think the wording of this question should have been turned around: not whether Muslims have the right to build a mosque on Park Place, but whether the government has the constitutional right to stop them from building a mosque on Park Place.

Still, I think everyone probably understands what this means, and it's just depressing as hell. It's one thing to oppose the mosque just because you don't like the idea, but to deny that Muslims even have a constitutional right to build it? That should be a no-brainer. Of course they do.

Seriously, this is from a man who probably does not think you have the Constitutional right to choose your own doctor. Why are Republicans ceding the high ground on this to Democrats? Well, it turns out that is the theme of my new column this week in Forbes.

...prospective mosque-banners would argue that I simply don't understand how utterly, deeply offensive the proposed location of this mosque is to them. But that is not the case. I am offended as well by what might be a laudatory memorial to a terrorist incident. But the question for me is, do we have a right not to be offended?

The irony is that for the last decade or so, conservatives have fought the political correctness movement over exactly this issue. Conservative commentators, rightly I think, were up in arms over the "hate speech" trial of Mark Steyn in Canada, and more recently the cancellation of Ann Coulter's Canadian speaking tour. In both cases Canadian government and university officials argued that Steyn's and Coulter's criticisms of radical Islam were too divisive, too defamatory to Muslims, and in general too offensive to be allowed public voice....

This is what truly floors me about the Ground Zero controversy: Republicans all over the country are standing up and begging House Speaker Nancy Pelosi and President Barack Obama to void the property rights of a private entity, shut down the construction of a church, and do so to protect some mythical right not to be offended, a right that, until recently, conservatives argued did not exist. Do Republicans really want to encourage the federal government to tear up property rights and First Amendment protections, all in the name of hurt feelings? If conservatives set this precedent today, they are almost certainly not going to like how it is used tomorrow.

Postscript: I notice something in this poll that I have seen several times lately.  Traditionally, poll results for independents always fell somewhere between Republicans and Democrats.  In this poll, as in several others I have seen, Independent responses actually fell outside of these bounds.  Increasingly independents are shedding the "moderate" label and actually pacing the two political parties.  I find this encouraging, though it is probably too much to hope for that this is the leading indicator of some type of radical ideological restructuring of the Coke and Pepsi parties.

I have absolutely no confidence that we will get 25% more work from our city employees on Mon-Thur to make up for a Friday day off.

Thursday could become the new Friday for thousands of Phoenix city employees in an effort to save money and keep workers happy.

Phoenix officials are considering mandatory Fridays off for administrative employees but would exempt those who support functions that can't be shut down such as water-plant employees, aviation workers and public-safety staff.

If approved, Phoenix would become the largest municipality in the state and the country on a mandatory four-day schedule, where employees typically work 10-hour days with Fridays off.

I am not sure we currently get 8 hours of work from many of them, and having been programmed for years or decades to an 8 hour day, I don't see them changing their behavior.  My alternate plan would be to cut everyone back to 32 hours a week, cut their pay by 20%, AND save energy on Friday.  By "alternate" I mean alternate to my base case of sending them all home permanently and waiting to see how long it takes for anyone to notice.

I have no particular problem with this post from Kevin Drum where he would like to see some different polling questions about the Ground Zero mosque (though I do think they reflect some naivite about the founders' intentions in building the mosque, as telegraphed pretty strongly by its proposed name).  I think the underlying desire to raise awareness about how small changes to poll question wording can make big changes to poll outcomes is a good one.

Here is my problem with all polls like this.  Consider the question

Do you oppose construction of the Ground Zero mosque?

How I answer this is influenced by the unstated intent of the poller or whomever is paying for the poll.  That is, the answer is likely be used as justification for some government action, in this case confiscation of the property rights of the owners of the land by not allowing them to do with the land as they wish.

In this nanny state of micro-fascism, we have a very hard time separating opposition to something from be desirous of government intervention.  For example, I oppose teenagers spending all day watching crappy TV and playing PS3 games rather than reading.  I oppose overcooked steaks.  I oppose people who take forever in buffet lines, selecting one leaf of lettuce at a time.  I oppose airplane bathrooms that smell bad.  I oppose using "incent" as a verb.  I oppose writers who have really long passages without paragraph breaks.  I oppose commenters who constantly harass me about my horrible proof-reading rather than just getting over it and accepting that I suck.

However, in none of these instances would I advocate government action.  Now, of course, I go further than most, in that I also oppose government action in any number of more controversial activities that I also personally oppose but would never ask to be banned, including prostitution, meth use polygamy, driving without a seat belt, and pulling tags off mattresses.   So a better question would be:

Do you oppose government action to block construction of the Ground Zero mosque?

I find all the angst over evolution of the Internet in articles like this one in Wired to be pretty funny.  It used to be that nostalgic conservatism longed for days 40,50, even 100 years ago.  Now apparently in high tech, nostalgia is for the good old days five years ago, in this case before iPhones, YouTube, and Facebook.   Yawn.

We all know Conservatives are supposed to be conservative, but I have written a number of times about the enormous conservatism of self-styled progressives.   I suppose its a human trait that at some point in time, say in their teens or twenties, people psychologically define the world to be "normal," after which change is disconcerting.  I am not sure I have ever felt that way, so I am only guessing and trying to read between the lines of others' comments.

The only reason I followed the link to the Wired article at all is that I saw this terrible graph reproduced:

I mean, its pretty, but implies that email and web browsing are going to zero, which is absurd.  In fact, my guess is that they continue to grow, but shrink as a percentage because of the growth of new uses, which are disproportionately bandwidth-heavy so skew the chart.  And by the way, is anyone but a few hardcore geeks sitting around lamenting the decline of FTP and newsgroups, which died about 5 seconds after there was a more efficient way to download porn.  Is Facebook really anything but a much more capable substitute for newsgroups and chat rooms?

Read this story, and then imagine if the facts had been reversed:

"A sports conference that always scheduled weekday basketball doubleheaders in which women's teams played the first game -- letting the men play in the later time slot -- has altered the practice, after an anonymous sex discrimination complaint charged that this made the women's games appear to be a "warm-up" act for the men's games.

Now, hoping to avoid possible gender equity suits, other athletic conferences are considering similar scheduling changes.  Last month, the Great Lakes Intercollegiate Athletics Conference announced that it would alternate from season to season the order in which men's and women's teams would play in doubleheaders. The men will play first this season, and the women will play first next season.

Dell Robinson, the conference commissioner, said the decision was made after the league received an inquiry in March from the U.S. Department of Education's Office for Civil Rights. An anonymous complaint filed with the agency argued that the negative connotation conveyed by always having women's teams play first in these doubleheaders was detrimental to women's athletics."

So let's imagine a alternate world where women's basketball games had always traditionally been played in the second game of the double-header, after men's games.  Does anyone believe that the civil rights folks wouldn't have filed a complaint saying

Having women's games always played after men's games makes them appear to be an after-thought to the main contest, positioning the game later in the prime social hours where potential student fans will be more likely to leave early and head to the bar instead of staying to watch.  The negative connotation conveyed by always having women't teams play last in these doubleheaders is detrimental to women's athletics.

See, its easy to be a race/gender advocate.

A couple of stories really drive the title of this post home to me.  First, flash back to any number of these type of stories

To Protest Hiring of Nonunion Help, Union Hires Nonunion Pickets

Billy Raye, a 51-year-old unemployed bike courier, is looking for work.  Fortunately for him, the Mid-Atlantic Regional Council of Carpenters is seeking paid demonstrators to march and chant in its current picket line outside the McPherson Building, an office complex here where the council says work is being done with nonunion labor.

"For a lot of our members, it's really difficult to have them come out, either because of parking or something else," explains Vincente Garcia, a union representative who is supervising the picketing.

So instead, the union hires unemployed people at the minimum wage"”$8.25 an hour"”to walk picket lines. Mr. Raye says he's grateful for the work, even though he's not sure why he's doing it. "I could care less," he says. "I am being paid to march around and sound off."

So we follow that up with this story of a union employee who was fired for... wait for it ... trying to unionize his fellow employees

In a move of stunning hypocrisy, the United Federation of Teachers axed one of its longtime employees -- for trying to unionize the powerful labor organization's own workers, it was charged yesterday.

Jim Callaghan, a veteran writer for the teachers union, told The Post he was booted from his $100,000-a-year job just two months after he informed UFT President Michael Mulgrew that he was trying to unionize some of his co-workers.

"I was fired for trying to start a union at the UFT," said a dumbfounded Callaghan, who worked for the union's newsletter and as a speechwriter for union leaders for the past 13 years.

Callaghan said he personally told Mulgrew on June 9 about his intention to try to organize nonunionized workers at UFT headquarters.

"I told him I want to have the same rights that teachers have," said Callaghan, 63, of Staten Island. "He told me he didn't want that, that he wanted to be able to fire whoever he wanted to."

The UFT has long strenuously resisted city efforts to make it easier for school administrators to fire teachers.

"This is the exact antithesis of what they preach, and Michael Mulgrew is the biggest hypocrite out there," Callaghan fumed.

As it turns out, when unions like the UAW get an ownership position in a company, they tend to act exactly like management

You could also entitle it "meet the new boss, same as the old boss". What I'm talking about is a recent meeting between UAW bosses and GM workers. To say it didn't go well would be a vast understatement)(via Sweetness and Light):

Workers at a General Motors stamping plant in Indianapolis, Indiana chased United Auto Workers executives out of a union meeting Sunday, after the UAW demanded workers accept a contract that would cut their wages in half.As soon as three UAW International representatives took the podium, they were met with boos and shouts of opposition from many of the 631 workers currently employed at the plant. The officials, attempting to speak at the only informational meeting on the proposed contract changes, were forced out within minutes of taking the floor.

The incident once again exposes the immense class divide between workers and union officials, who are working actively with the auto companies to drive down wages and eliminate benefits.

Actively working with the auto companies? They are part owners now of the auto companies "“ they're "management" for heaven sake.

In each situation, when the tables are turned, union leaders suddenly discover the economic realities those of us who run businesses have always understood, ie

• You don't pay more for labor than you have to.  That is what markets are about.  If good people are running around unemployed who are grateful to make $9 an hour, then hiring them is a win-win for both of you.  Setting an arbitrary price floor out of some notion of fairness merely leaves more people unemployed.  From the first story, this is a position the union never takes with any business but itself, but is certainly correct

The union's Mr. Garcia sees no conflict in a union that insists on union labor hiring nonunion people to protest the hiring of nonunion labor.

He says the pickets are not only about "union issues" but also about fair wages and benefits for American workers. By hiring the unemployed, "we are also giving back to the community a bit," he says.

• Its nearly impossible to run a business if one can't hire and fire at will.  If, once hired, it becomes impossible (e.g. through a tangle of grievance processes) to fire people, then no business can operate well
• Contrary to certain progressive notions, corporations do not have some sort of infinite treasury full of horded Nazi gold that can pay for any possible wage level.  Given product pricing in a particular industry as well as productivity levels, the labor budget is finite.  At GM, the reasonable labor budget is both finite and likely lower than its current level.  It is admirable at some level to see UAW officials dealing with this hard fact of fiscal responsibility (better, in fact, than are most government officials).  But one wonders how incentives could have been structured better in the past so that this epiphany could have been reached 30 years ago before the golden goose was already killed.

Everyone else may know about this feature, but I wrote an email today where I was going to attach some tax documents for my accountant.  The email said something like "see attached..." but I forgot to attach the files before I hit "send."  Gmail popped up a message that said something like "you had 'see attached' in your text but did not attach a file, did you mean to?"  Why, thanks.

In this week's episode, your tax money goes to subsidizing low cost, low down payment loans for New York luxury condo buyers.

To:  David DeWitt (Press Secretary)

I am always happy to see more libertarian candidates in our Congressional races, but in the year 2010 I just don't think there is an excuse for sending out a mass email for anything other than Viagra without an "unsubscribe" link. This is particularly true given that your campaign must be harvesting email addresses from a variety of sources rather than using an opt-in system, since up until today I had never even heard of Travis Irvine nor do I live in Ohio.  There are many services that provide automated mailings that take care of all the list management and unsubscribe mechanics.  Constant Contact has a very nice service.

Since your candidate is a libertarian and, I assume, familiar with the concept of rational self-interest, I will put my suggestion in those terms.  Without an "unsubscribe" link, I am forced to hit the "report spam" button in Gmail.  If enough people do the same, there is a good chance your candidate's email will not be getting through to anyone's email box, even those who are interested.

Several observers, including Megan McArdle, said that I was too harsh when I wrote this in a post about pre-employment screening:

I understand that this is exactly what the Left is shooting for "“ an environment where the competent have no advantage over the incompetent.  If employers are resorting to FICO scores, it just demonstrates how all the other reasonable avenues of obtaining information have been closed to them.

Unreasonable?  Perhaps.  Or perhaps not.  From the US EEOC site:

There is no Federal law that clearly prohibits an employer from asking about arrest and conviction records. However, using such records as an absolute measure to prevent an individual from being hired could limit the employment opportunities of some protected groups and thus cannot be used in this way....

Even if the employer believes that the applicant did engage in the conduct for which he or she was arrested that information should prevent him or her from employment only to the extent that it is evident that the applicant cannot be trusted to perform the duties of the position when

• considering the nature of the job,
• the nature and seriousness of the offense,
• and the length of time since it occurred.

...

Several state laws limit the use of arrest and conviction records by prospective employers. These range from laws and rules prohibiting the employer from asking the applicant any questions about arrest records to those restricting the employer's use of conviction data in making an employment decision.

This means that a company cannot, according to the EEOC, maintain a blanket policy of, for example, never hiring anyone convicted of murder or bank robbery.  Just take that as your happy thought for the day next time you are snuggling up for bed at night in some hotel, wondering if you are in a state where the hotel was allowed to screen its night-time employees for felonies.

My sense is that the Left is shooting for employment based on paper qualifications rather than perceived capability.   I wrote before that the Left has cheered on tort actions that have almost shut down the provision of job references.  Or look at civil service or schools.  Hiring is based on minimum qualifications (e.g. possessing the correct teaching degree) rather than ability.  Promotion is based on seniority rather than performance.  Every grievance system ever invented makes it almost impossible to fire employees even for cause, much less for performance shortfalls.

A while back in my Forbes column on the incentives faces by government workers, I wrote

People sometimes say that problems involving difficult trade-offs are hard for government bureaucracies to handle. This isn't true--most of these trade-offs are in fact easy for them to handle, because the outcome is as predetermined as a river's path through a well-worn valley. The problem is having these trade-offs made well.

Most of the tough decisions in the Gulf involve violating a rule or standard practice for which an agency and its staff have specific accountability for compliance. This is balanced against the opportunity to gain some benefit that is outside of the agency's responsibility and for which it will not be rewarded or punished. An example would be the administration's ban, at EPA insistence, of what BP ( BP - news - people ) claims is the most effective oil dispersant because it is potentially toxic. Does this dispersant's toxicity create more or less harm than the lost opportunity of preventing a lot of oil from entering coastal wetlands? The answer doesn't matter, because there was only one way the EPA was ever going to rule on this--their employees are easily able to duck blame for any damage from the spill, but they would be right on the firing line if even a single living creature was provably harmed by their allowing the dispersant to be utilized. Fear of blame for consequences of an action outweigh the opportunity costs of inaction every single time.

We see this again in this video, where school teachers and nurses in California argue that it is better to allow kids to die from their inaction than to take an action (e.g. dispense a life-saving medication)  that might have harmful consequences.

OK, so after the monks and coffins, here is the future licensing act ripe for abuse by industry incumbents to protect their position.

New state licenses required for anyone handling a mortgage application could help prevent a repeat of the bad loans that contributed to Phoenix's housing crash....

The law, passed in 2008, creates state oversight for people who take loan applications, gives consumers an avenue for reporting misconduct and establishes a fund to help repay borrowers who lose money because of unethical or illegal acts by their loan officers.

The law faces hurdles, as cash-strapped Arizona struggles to process thousands of new applications.

Still, advocates call it a success. Many of the risky - and sometimes illegal - home loans that helped lead to record foreclosures in Arizona might not have been made if the more than 10,000 unlicensed loan officers working then had been subject to more oversight.

How?  If people were selling illegal home loans before, they were already breaking the law and the state obviously was unable to enforce the law.  How is adding a piece of paper that must be applied for each year going to help?  My company has all kinds of silly licenses - liquor licenses, guiding licenses, health licenses, tobacco sales licenses, over-the-counter drug sales licenses, even egg licenses - and in not a single case does the issuer of these licenses exercise any sort of oversight of our operations.  If they get their extensive paperwork (so workers have an excuse to retain their jobs - after all someone has to process the paperwork) and their check, that is generally the sum of interactions with these organizations.

Now, some of these licenses were hard to get in the first place, but not for any reason of my character or ethics or business model.  They were hard to get because their issuance has been co-opted by incumbent businesses in the state who use the process to limit competition.  Liquor licenses are a great example - in places like Shasta County CA and Lake Havasu City AZ, we had a real problem getting the liquor license over opposition from existing businesses.

This is almost mindless naivete:

"Loan-officer licensing is long overdue in Arizona," said Felecia Rotellini, who for five years served as superintendent of the Department of Financial Institutions, the state agency regulating the mortgage industry. She is running for Arizona attorney general.

"A lot of bad loans wouldn't have been made if we had it before," Rotellini said. "It gives me peace of mind for consumers to know we have licensing now."

The author of the article just throws the following statement out there without any source, as if it was an axiom with which we all would agree

In Arizona, the housing boom and crash were partly fueled by loan officers, how they operated and how they were paid.

In fact, the author's incredible confidence in licensing is undermined in this adjacent statement:

Mortgage brokers, who run firms that connect borrowers with the best loans, have long been regulated by the Department of Financial Institutions.

Brokers employ loan officers, who work directly with borrowers, collecting their Social Security numbers and financial information to determine whether they qualify for a loan. Loan officers usually recommend types of mortgages and lenders.

These officers, sometimes called originators, weren't subject to state scrutiny. They worked under the licenses of their brokers, much the way an apprentice would work for a licensed contractor. Previously, that oversight was considered sufficient.

So the firms these guys worked for were licensed, but the individual employees were not. But if that licensing of firms, which after all is the level where loan practices and compensation policy are set which supposedly are at fault, how does licensing individual employees help? This is a typical political step that a) gets some state organization more money and power, b) generates one sound bite in a news cycle for some politician to tell voters that they care and c) does zero for consumers.

At the end of the day, the real cause of the housing boom was easy credit, and yes loan officers participated in this given that their commission-based incentives caused them to want to make every loan possible.  But this incentive outcome would not have been some kind of insight to the people and system that employed the loan officers.  In fact, everyone from the loan officer to the Congress wanted easy credit, and to blame one link in the chain of delivering this credit to consumers is madness.  Going forward, there is absolutely no evidence that the government is going to reduce its history of promoting easy credit, as evidenced by any number of federal loan modification and lending programs over the last 2 years.  So the likelihood that a government regulatory agency could have somehow headed off the bubble and its bursting is just silly.  The government was a party to it.

In the long run this mechanism will almost certainly be co-opted by current loan issuers as a way to limit competition, much as real estate agents and lawyers and funeral home directors already do.  As a minimum, this is a way for mortgage brokers to outsource some of the cost of running background checks and such on their employment candidates onto taxpayers.  In fact, I wonder who was behind this law in the first place?

Backed by mortgage brokers and real-estate regulators, the law quietly went into affect on July 1

This week's episode -- Monk's making simple caskets to support themselves must desist because Louisiana has detailed licensing laws to protect current funeral homes from just this type of low-cost competition. This is what the monks would have to do to sell what is basically a nice wooden box

Louisiana law purports to require that anyone who is going to sell a casket has to jump through all same regulatory hoops as a full-fledged mortuary operation that embalms bodies. See, selling "funeral merchandise" (including caskets) means you are a "funeral director." And to be a "funeral director," you must be approved for "good moral character and temperate habits" by a funeral-related government entity [of course, that's in Louisiana, but still], complete 30 semester hours at college, apprentice with a funeral director for a year, pay an application fee, and pass an exam. But that's not all. If you want your facility to sell caskets, it's got to qualify as a facility for funeral directing, including a showroom and "embalming facilities for the sanitation, disinfection, and preparation of a human body."

The monks are being represented by the IJ (what the ACLU should have been if it weren't for its Stalinist founders) which hopes to get to the Supreme Court.  If I were one of the monks (wildly unlikely as that is) I might be tempted to sell them as "human-sized wood boxes" rather than coffins and see where that got me.