Author Archives: Ryan Young

CEI Podcast for May 31, 2012: Ten Thousand Commandments


Have a listen here.

Congress passed 81 bills last year, while agencies passed 3,807 regulations. This, according to Vice President for Policy Wayne Crews, is regulation without representation. Crews discusses this and other findings from the just-released 2012 edition of his annual report, “Ten Thousand Commandments: An Annual Snapshot of the Regulatory State.”

Small Mercies: At Least He’s an Ex-Congressman

The Hill: GOP ex-Rep. Hoekstra: FBI, CIA should vet candidates’ citizenship

This birther nonsense just refuses to die. Also notice that, at least to my knowledge, every single birther opposes President Obama. Not a single one says, “I agree with him, though I think he was born in Kenya.” Weird, huh?

It’s not enough to simply disagree with his policies. They have a need to make it personal. “I disagree with him, therefore he must be ineligible for office.” This is not a healthy mindset.

If anything, I think the U.S. citizenship requirement should be abolished. In 1812, it might have mattered quite a bit if a foreigner — a British citizen, perhaps? — became President. Here in 2012, that once-wise policy is no longer needed.

“Because That’s Where the Money Is.”

In one of those too-good-to-be-true urban legends, a man once asked the famous criminal Willie Sutton why he robbed banks. “Because that’s where the money is,” he replied. Fast forward eighty years or so, and one sees that the business world has learned from Sutton’s wisdom.

LightSquared is a technology company that is going through chapter 11 bankruptcy despite receiving a $267 million government loan. Its satellite-based high speed wireless network has a fatal flaw: it interferes with GPS devices, making it useless. The FCC is blocking it, leaving the company with essentially zero business until they can solve the problem.

The company has laid off about half of its workforce so far. But The Hill’s Brendan Sasso and Kevin Bogardus found out that LightSquared is making sure to retain its most lucrative employees. Those would be its lobbyists, not its engineers:

Despite the financial troubles and staff cutbacks, LightSquared has yet to disband its lobbying army — an implicit acknowledgment that the company’s future is contingent upon what happens in Washington.

In other words LightSquared, just like Willie Sutton, knows where the money is. And it isn’t in the marketplace.

Businesses fail all the time. If they don’t create value for their customers, they don’t deserve to stay in business. Capital that is being wasted by these companies is then freed up for more valuable uses. Schumpeterian creative destruction doesn’t work without that destructive part. When Washington puts its thumbs on the competitive scales as it has with the LightSquared loan, it should surprise no one that companies suddenly swarm Capitol Hill for a piece of the action.

The result is less destruction, but also less creation. Corporate welfare means less innovation and less economic growth. It creates plenty of jobs for lobbyists and lawyers, but at the expense of other jobs that create actual value for consumers – such as many of LightSquared’s layoffs, who could be finding a technical solution for its GPS interference problem.

CEI’s Battered Business Bureau: The Week in Regulation


Just another week in the world of regulation:

  • 95 new final rules were published last week, up from 84 the previous week. That’s the equivalent of a new regulation every hour and 46 minutes — 24 hours a day, 7 days a week. All in all, 1,583 final rules have been published in the Federal Register this year. If this keeps up, the total tally for 2012 will be 3,968 new rules.
  • 1,628 new pages were added to the 2012 Federal Register last week, for a total of 31,432 pages. At this pace, the 2012 Federal Register will run 77,040 pages.
  • Rules are called “economically significant” if they have costs of $100 million or more in a given year. The 22 such rules published so far in 2012 have compliance costs of at least $14.3 billion. Two of the rules do not have cost estimates, and a third cost estimate does not give a total annual cost. We assume that rules lacking this basic transparency measure cost the bare minimum of $100 million per year. The true cost is almost certainly higher.
  • No economically significant rules were published last week. So far, 172 significant final rules have been published in 2012.
  • So far this year, 292 final rules affect small businesses. 40 of them are significant rules.

Highlights from final rules published last week:

  • Good news on the international trade front: the International Trade Administration published a rule withdrawing a tariff quota on imported fabric that expired in 2009 (timely!). The rule also repeals rules for short supply procedures. “Short supply procedures” means that when domestic supply falls short of demand, the government blocks fewer imports than usual to ease the shortage. Now the ITA will stay out of the way entirely, as far as cotton is concerned. This bit of housecleaning came about through President Obama’s January 2011 Executive Order, “Improving Regulation and Regulatory Review.”
  • The official legal meaning of the term “unblockable drain” has been revised, thanks to the Consumer Product Safety Commission.
  • It is against federal rules for a commercial driver to make entries to an automatic on-board recording device while his vehicle is in motion. A new Federal Motor Carrier Safety Administration rule specifies that it’s ok for anyone else in the vehicle to do so.
  • Morelet’s crocodile is no longer an endangered species, though the crocs “will remain protected under the provisions of the Convention on International Trade in Endangered Species of Wild Fauna and Flora.”

For more data, updated daily, go to TenThousandCommandments.com.

Gone Fishin’

I’ll be out of town over the long weekend, and mostly off-grid.

Regular blogging will resume on Tuesday.

CEI Podcast for May 24, 2012: Driverless Cars


Have a listen here.

Driverless cars are a new technology that could revolutionize the way we think about transportation. A prototype driverless car made by Google recently made the rounds in Washington, DC, and Land-use and Transportation Policy Analyst Marc Scribner got to take a ride. He shares his experience, talks about the potential benefits for road safety and congestion, and the regulatory hurdles that driverless cars must clear before they can enter the marketplace.

An Economics Disaster

Even Nobel laureates forget their economic fundamentals sometimes. Paul Krugman, who knows better, recently fell for the broken window fallacy in a post at his New York Times blog. He argues that the tsunami that hit Japan last year has boosted the economy. An error that basic demands correction; my attempt ran today in The American Spectator:

Imagine for a minute that the tsunami never happened. Japan’s GDP growth would probably be slower; Krugman is almost certainly correct on that. And yet, a tsunami-less Japan would be better off. For one, the survivors wouldn’t have 15,000 holes in their hearts where their families, friends, and neighbors used to be.

As far as the economy goes, all that reconstruction spending would instead go to creating brand new wealth, as opposed to merely replacing what people already had to begin with. It is better to build than to rebuild.

Read the whole thing here.

CEI Podcast for May 17, 2012: Ethanol’s Overstated Benefits


Have a listen here.

Senior Fellow Marlo Lewis takes apart a study claiming that ethanol lowers gas prices by more than a dollar per gallon in some regions. Unrealistic assumptions and dodgy methodology make the results less than trustworthy. Ethanol, Lewis argues, is widely used only because the federal government requires it to be. If it had to compete on a level playing field like most other products, it would be a flop.

Guess the State

“Please, don’t take the steam tray. Sir!”

Man Protests All-You-Can-Eat Restaurant After Getting Kicked Out for Eating Too Much

CEI’s Battered Business Bureau: The Week in Regulation


Just another week in the world of regulation:

  • 62 new final rules were published last week, down from 70 the previous week. That’s the equivalent of a new regulation every 2 hours and 43 minutes — 24 hours a day, 7 days a week. All in all, 1,384 final rules have been published in the Federal Register this year. If this keeps up, the total tally for 2012 will be 3,838 new rules.
  • 1,577 new pages were added to the 2012 Federal Register last week, for a total of 28,191 pages. At this pace, the 2012 Federal Register will run 76,606 pages.
  • Rules are called “economically significant” if they have costs of $100 million or more in a given year. The 20 such rules published so far in 2012 have compliance costs of at least $15.4 billion. Two of the rules do not have cost estimates, and a third cost estimate does not give a total annual cost. We assume that rules lacking this basic transparency measure cost the bare minimum of $100 million per year. The true cost is almost certainly higher.
  • One economically significant rule was published last week. There were a total of 5 significant actions last week, as defined by Executive Order 12866. So far, 152 significant final rules have been published in 2012.
  • 12 of last week’s final rules affect small business. So far this year, 259 final rules affect small businesses. 40 of them are significant rules.

Highlights from final rules published last week:

  • An economically significant rule from the Centers for Medicare and Medicaid Services implements section 2401 of the Affordable Care Act. It increases this year’s federal Medicaid spending by $820 million, and this year’s state Medicaid spending by $480 million. Since these costs are government spending instead of compliance costs, I am scoring it as zero-cost for this year’s compliance cost tally.
  • Just in time for summer, the FDA published a rule delaying implementation of an earlier rule amending its surprisingly detailed sunscreen regulations.
  • The EPA is liberalizing its [alpha]-[p-(1,1,3,3-Tetramethylbutyl)phenyl]-[omega]- hydroxypoly(oxyethylene) tolerance requirements for pesticides. A separate rule liberalizes “residues of α-(p-nonylphenol)-ω-hydroxypoly(oxyethylene) mixture of dihydrogen phosphate and monohydrogen phosphate esters and the corresponding ammonium, calcium, magnesium, potassium, sodium, and zinc salts of the phosphate esters and α-(p-nonylphenol)-ω-hydroxypoly(oxyethylene) sulfate, ammonium, calcium, magnesium, potassium, sodium, and zinc salts” in pesticides.
  • If you want to get a commercial driver’s license, you should be aware of new federal minimum standards.

For more data, updated daily, go to TenThousandCommandments.com.