Wednesday, April 15, 2009

T.E.A. Party Day

Hooray for the Tea party organizers. I'm going to my local Tea party today to see what happens.

The stimulus bills and associated pork may have been the catalysts for the Tea party movement. However the larger and longer term issue is the growth of government spending as a percentage of GDP. That is bad, on top of all the other reasons, because a dollar cycled through the government has a lower multiplier than a dollar kept circulating in the private sector. That subject is explored in detail in any good first- or second-year economics course.

For those that don't care about wealth, or want to lower it, the lower multiplier is not a problem. For the rest of us it's a key issue, even if it's not usually argued in those terms.

So I'm off to my local Tea party. Here's an article that surveys the Tea party phenomenon.

Thursday, April 2, 2009

What To Do About the Cap and Trade Idea?

What really should be done from a normal free-markets and American perspective? Forget it; it’s nothing but a big market distortion. People willingly buy goods and services that return utility to them – not the right to cause dis-utility to another unidentified and nebulous group. Only a small part of the population would pay into such a fund voluntarily. If they feel better contributing, great. If a Cap and Trade tax program is implemented as the Obama administration has proposed, the only logical place for the revenue is to fund forests and other plants that efficiently convert carbon dioxide back into oxygen. Imagine paying Brazilian rain-forest owners and farmers a fee to recycle carbon dioxide! But that’s not what our environmentalists or the Executive Branch are thinking. They want to use the funds to create further market distortions subsidizing their chosen energy technologies and groups.