The View From 1776

Strangling Regulation

I have frequently alluded to strangling regulation as a major reason for the glacially slow recovery from the Great Recession of 2001-08, noting that it is a recapitulation of Franklin Roosevelt’s socialistic New Deal tactics.  During the dreary days of the 1930s Depression, everybody was continually being hammered with huge tax increases, and businesses were continually threatened with punitive regulations, along with governmental support for Spanish-style syndicalist, industrial labor unions and nationalization of agriculture.

Obama has bullheadedly rampaged along that same path, with the same result: businesses have feared to invest in new or expanded production, not knowing what future costs and restrictions may be.

Reader Robert Stapler gives us a picture of the Obama modus operandi in his recent comment to one of my earlier posts.  Let me emphasize one element that Mr. Stapler mentions in passing: Obama’s open declaration of intent to destroy the coal mining industry, throwing thousand workers into the unemployed ranks and greatly increasing the cost of energy for households and business.  At the very moment when our nation is on the threshold of increased abundance of petroleum and natural gas, which makes our industries more competitive with the rest of the world, Obama and his radical left-wing supporters are employing every available device to kill fracking and building new pipelines to transport oil and gas.

A reader commented:

I am trying hard to remember any ways this administration was hostile toward business, other than perhaps trying to get them to pollute less.

To which Mr. Stapler replied:

I am so glad you asked that question.

Before going into actual evidence of administrative hostility (or abuse), however let’s look at the public perception of administrative hostility. Perception isn’t proof, but it does establish a lack of credibility for your argument. A recent Rasmussen poll (see ) found that significantly more than half of those polled agree the administration is hostile. Even a substantial number of Democrats polled agree it is hostile, though I must assume these particular Democrats agreed because they regard his hostility as justifiable in much the same ways you do (i.e., approve of it and too dumb to disguise the fact). Thus it is no secret Obama, his base, and his ideologically driven department heads are openly hostile toward capitalism generally and certain industries specifically. Any president who declares himself in favor of redistribution before he was elected can only be of the opinion ‘profit is theft’ (which is its own justification for confiscation), and that is precisely what hostility-approving Democrats applaud.

[As a sidebar, the poll results indicate voters clearly recognize the extraordinary extent to which crony-capitalism (i.e., corruption, 71%) plays a part in this administration. But, of course, you are in denial of that as well.]

So too, the 2012 election was a Democrat ‘vote of confidence’ regarding his first term, including his harsh treatment of big oil, carmakers, and insurance companies. The ‘Occupy Wall Street’ movement of a couple of years back was a protest against corporations of most descriptions, which (both you and) the President openly supported, is another clear indication of this hostility. His callously dismissive dig against American industries suggesting they had little to nothing to do with creating our many infrastructure achievements was another give away. Therefore (and because you share in this hostility), your apparent ‘surprise’ is bogus and was meant for effect. Or, if not feigned, then you are seriously out of touch with your own party’s collectivized bitterness.

Although he eventually relented, Obama’s 2011-2012 very real threat of allowing the Bush tax cuts to expire was regarded hostile by the small-business community. Corporate tax hikes are regarded somewhere between hostile and indifferent by mid-sized companies as well. Yet, it must be recognized the same is not true of many super-sized corporations as give heavily and preferentially to Democrats (see,_greedy_ceos_give_heavily_to_democrats ) in 2008, 2010 and 2012; including Obama. This begs a question – why did they do that knowing they would increase burdensome taxes and regulation on them? After all, the effect of high corporate taxes and regulations (oft complained of within these pages) is entrepreneurial discouragement. High tax rates and regulation (relative to some other country or state) tend to drive smaller businesses either into relocating or giving up. Part of the answer may lie in that many large corporations have already relocated offshore or lobbied for loopholes effectively sheltering them from the consequences of these policies. Therefore, it may be they support new taxes and regulations for the relative advantage it gives them over the competition. Thus, it isn’t always obvious why big corporations give lavishly to tax & regulate politicians until you realize how it works in their favor. Also, the subsidies derived from these same hikes wind up going right back to many of the same (highly favored) corporations, partly compensating them for losses. Thus, the whole thing may be rigged in their favor, which is an idea your own party has promoted a long time. I am not saying this is the case, I am merely suggesting the complaint has merit.

You brought up pollution as a justification for hostility, so let’s explore that for a moment. Has pollution gone up or down under Obama, and, even if down, is the decrease attributable to him alone or to some combination of him and predecessors (or Congress or courts, &c)? Putting this another way, if N-presidents make large strides toward a common goal, and president N+1 adds only small amount to it, does all credit accrue to the last president standing? Or do we, in fairness, give credit where it is really due. For the sake of argument, let’s concede it has gone down recently (though there is a great deal of reason to suspect government [especially the current one] of playing fast and loose with data). Accepting EPA’s most recent assessment (see ), it is down but stubbornly remains far greater in urban than in non-urban areas of the country, and that correlates strongly with mass transit and jammed traffic. This argues for de-urbanization to the extent feasible. Yet, one of Obama’s stated goals is to push us in the direction of greater urbanization and mass transit; which, as it turns out, is counter-productive from the vantage of meeting his also oft stated pollution-reduction goals. Yes, I know you socialist are more impressed by vague promises and lofty intentions than by actual results; but here you are hypocritical because you refuse giving recognition to Republicans who pursue those very same objectives but with far greater success. In fact, it galls you when that happens.

The same is true of Obama’s ill-conceived and supposedly ‘environmentally-friendly’ policies favoring renewable over fossil fuels. One of renewable energy’s big selling points is that it (supposedly) reduces pollution. The reality, however, is that fuels like ethanol and bio-diesel pollute more than fossil fuels; whether as consumed or in production. One of Obama’s major efforts has been push for increases for these two fuels, even if it means certain staple foods become scarcer and costlier. He has also thrown his presidential weight behind solar and wind. But solar/wind represents a far smaller share of the renewable pie than do bio-fuels, which, itself, represents a shrinkingly small part of the energy-supply pie. Moreover, both of these energy sources are so unreliable as to require backup fossil systems, thereby nullifying their primary advantage by causing the associated fossil burners to cycle often. Turning burners off & on simply to gratify renewable’s advocates we are maximizing solar/wind operations is terribly inefficient, and translates into an increase in pollution (rather than a reduction). Therefore, solar/wind in practice increases pollution, and is the tail wagging the dog. Given Obama’s preferential treatment of renewables without sufficient reason to give them such a preference, combined with his open harassments and disparagements of oil, coal and gas companies (and utilities), we can be forgiven thinking him hostile toward the latter.

These two areas (regulation and renewables) represent the largest contributions Obama has made thus far to pollution reduction, neither of which is especially effective. Bush was also an advocate for bio-fuels, renewables, subsidies and the like, but where Bush tread lightly and worked cooperatively with industry, Obama has been almost entirely adversarial and from the very start of his administration.

Both presidents did, indeed, move us in the direction of greater regulation, and that resulted in somewhat less pollution. Yet, it is somewhat speculative as to which of these two presidents should be credited more with this achievement as no assessment has been made regarding their relative contributions, and would, in any case, be difficult to prove. We do have some indications to guide us however. Four major pieces of legislation affecting energy use and pollution were passed and signed into law by Bush. So far, there has been no major environmental legislation either coming from or supported by Obama (the one supposedly more committed to this goal) other than to tweak some earlier laws. However, there has been a massive increase in regulation (i.e., backdoor lawmaking) and prosecution at his and Holder’s specific direction for which there is no real accountability. Therefore, any reasonable approval ought to go to Bush on this score. Moreover, there is no other reasonable interpretation for Obama’s almost exclusive preference for prosecutorial (rather than cooperative methods) of accomplishing his pollution objectives, unless by it he means to punish more than addresses an issue.

I can go on dredging up more and more examples of this hostility if you like, but this should suffice to prove to any casual reader, at least, you were blowing partisan smoke in your last post. If your argument is that Obama’s behavior isn’t hostile given it can be justified, then you are going to have to prove that is the only or best way to get things done AND that it represents a sufficient justification for bullying and lawbreaking; which you haven’t and can’t.

Additional readings: - Gibson guitars took its share of harassment in stride and settled rather than fight; but still managed to make a statement its treatment by DOJ was both petty and a cause for alarm. As this additional report shows (see ), DOJ went after Gibson over some imported wood (which is only a crime in the wood’s country of origin; i.e., illegal to export it, not illegal to import it here). The report further suggests the real reason Gibson was targeted was because its CEO gave money to Republicans, tying this to the IRS scandal.