The Locker Room

December 29, 2008

It must be time for more incentives

Posted by Mitch Kokai at 4:52 PM

Economy in the tank? It must mean the state needs to offer more corporate welfare:

State commerce officials aren't cutting back on their targeted efforts to create jobs, and plan to focus in 2009 on about a dozen industries that promise good wages. The most promising prospects include aircraft engines and parts, transportation equipment, and data centers similar to the one Google opened in 2008 near Lenoir.

Commerce Secretary Jim Fain said North Carolina also plans to chase companies in life sciences, food production and services, solar-energy equipment production, nuclear services projects, and maybe even a few corporate headquarters.

Why is this a bad idea? Click here.

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Sad Farewell

Posted by Dr. Karen Y. Palasek at 2:06 PM

It is with great sadness that we note the passing on Dec. 21st of a devoted friend of the John Locke Foundation, Jerry Seaman of Sanford, NC. Jerry's many friends here will miss him, and I will especially miss his weekly visits to our Shaftesbury luncheon talks here in Raleigh. Regrets on this sad occasion are offered to Jerry's family and friends.

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Entreprenurial Creativity in Troubled Economic Times

Posted by Dr. Troy Kickler at 1:30 PM

History can offer lessons for the present circumstances.  In a letter to W.E.B. Du Bois, Charles Clinton Spaulding argued that the Depression would cultivate a generation of superior business managers by forcing them to operate businesses more efficiently.  His company, North Carolina Mutual Life Insurance Company, had suffered a series of economic setbacks during the 1930s, and he adjusted by trimming expenses--to name one example.  For more, see Charles Clinton Spaulding on northcarolinahistory.org

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The effects of unionization

Posted by George Leef at 11:12 AM

It isn't only the stratospheric hourly wages and benefits the UAW wrung out of the Big Three that now have them at the brink of bankruptcy, but also work rules that retard efficiency. Here's an enlightening blog post making that point.

The same thing is true in construction. Unionized construction has a hard time competing with non-union because the latter can make more efficient use of workers. You don't find the "Hey -- that's not my job" mentality that unionized firms are famous for.

Next year, Congress will debate the so-called Employee Free Choice Act, which is meant to grease the rails for Big Labor to fasten itself onto more companies and dragoon more workers into the dues-paying ranks. Since American firms face increasingly stiff international competition in many industries, is it really a good idea to promote unionization? Shouldn't we be looking for ways to help them become more efficient, not saddling them with a parasitic entity that will make them less efficient?

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The effects of unionization

Posted by George Leef at 11:12 AM

It isn't only the stratospheric hourly wages and benefits the UAW wrung out of the Big Three that now have them at the brink of bankruptcy, but also work rules that retard efficiency. Here's an enlightening blog post making that point.

The same thing is true in construction. Unionized construction has a hard time competing with non-union because the latter can make more efficient use of workers. You don't find the "Hey -- that's not my job" mentality that unionized firms are famous for.

Next year, Congress will debate the so-called Employee Free Choice Act, which is meant to grease the rails for Big Labor to fasten itself onto more companies and dragoon more workers into the dues-paying ranks. Since American firms face increasingly stiff international competition in many industries, is it really a good idea to promote unionization? Shouldn't we be looking for ways to help them become more efficient, not saddling them with a parasitic entity that will make them less efficient?

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Conservative giving

Posted by Joseph Coletti at 10:19 AM

Bill Simon talks to the Wall Street Journal on donor intent, the future of giving, and the importance of think tanks.

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The proper role of education

Posted by Mitch Kokai at 06:48 AM

The latest issue of Commentary (not yet posted online) includes historian Wilfred McClay’s review of Charles Murray’s book, Real Education.

There is both a populist and an elitist strain in Murray’s analysis. This becomes clear when he puts forward the four “simple truths” that form the backbone of the book’s argument. These are that ability varies; that half of the children are below average; that too many people are going to college; and that America’s future depends on how we educate the academically gifted.

One can sense the sheer delight with which Murray puts forward these blunt, calculated-to-offend statements. To many readers, they will seem intended to consign large numbers of Americans to permanent second-class status. But Murray insists that, to the contrary, he is merely pointing out something patently true. Although we have allowed the academic-credential mania to persuade us otherwise, going to college is, for a great many of life’s purposes, vastly overrated. In a free society there are other paths to learning about the world and finding one’s place in it, and a school-centered yardstick that de-values those means is not only false but impoverishing.

Hmm. College is oversold? I think I’ve read that somewhere before.

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Blame deregulation?

Posted by Mitch Kokai at 06:47 AM

The latest issue of First Things includes interesting observations from Michael Novak about the impact of the current economic crisis on the future of “democratic capitalism.” (Subscribers can access the article here. It’s titled “An Apology for Democratic Capitalism.”)

Among Novak’s more astute observations is his response to the notion that deregulation deserves much of the blame for our current economic woes.

In the case of the mortgage crisis, Democrats blame the Bush administration’s commitment to deregulation. Yet the facts do not bear them out. It was the Democrats who blocked the regulation of Fannie Mae and Freddie Mac, and the Republicans insisted that the regulation of these two government-sponsored enterprises was essential.

Most emphatically, regulation that establishes rules without biasing outcomes (like the rules for football or baseball) is necessary for the common good. But regulation that grants undue powers to the government, puts the bureaucrat’s thumb on one side of the scales, or weakens the balance of power between one competitive actor and another is unjust. More, it’s damaging to the economy.

Then, too, regulation that places the government in the position of being easily bribed or influenced by one party is dangerous for the liberties and rights of citizens. All those who argue that lobbyists are the source of corruption are overlooking the role of government in accruing unchecked powers of favoritism. When government has the ability to place its heavy finger on one side of the scales, it invites massive lobbying by all involved. Lobbies wax and wane in proportion to the unchecked powers the government — particularly through the staff-level writers and enforcers of rules — claims for itself.

Out of this aggrandizement is fashioned the famous “iron triangle” of government regulation. Lobbyists and interest groups stir up public opinion demanding action this way or that; the legislators bend to the winds of this pressure; the congressional committees and their friends in the bureaucracy write the immensely detailed and arcane rules that, with little oversight, put legislation into practice. Thus does the behemoth of government bureaucracy suffocate economic creativity, competition, and the invention of new products and new industries that lead to prosperity.

For more Locker Room discussion of economic regulation, click here, here, or here.

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A lobbyist’s dream? Higher tax rates

Posted by Mitch Kokai at 06:44 AM

If you don’t like the idea of special interests sneaking their nefarious ideas into the political decision-making process in Washington, D.C., beware the coming Obama administration.

That’s one of the warnings Arthur Laffer, Stephen Moore, and Peter Tanous deliver in their recent book, The End of Prosperity: How Higher Taxes Will Doom the Economy — If We Let It Happen:

The higher the tax rate, the greater the value of special-interest loopholes and carve-outs and the more coveted insider lobbyists become. Think about it: At a 40 percent tax rate a tax deduction is worth twice what a tax deduction is at a 20 percent tax rate. This is something that Barack Obama does not seem to understand. He says he wants to rid Washington of the lobbyists who get favors from Congress for their clients, but by raising tax rates to 50 percent or more, he makes lobbyists a prized commodity. If Mr. Obama really wants to put a muzzle on the undue influence of lobbyists, he should embrace a low flat rate tax with no deductions and loopholes that can be bought and sold inside congressional committee rooms.

Moore offered other highlights from the book during a recent Americans for Prosperity tour through central North Carolina. Click here for details.

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How will the terrorists react to Nov. 4?

Posted by Mitch Kokai at 06:41 AM

The latest print version of National Review focuses much of its attention on the good, the bad, and the ugly from George W. Bush’s eight years in office.

Among the more interesting observations are those of Mark Steyn, who has spent much of his time in recent years warning about a crisis in the ongoing task of preserving Western civilization. Steyn concludes his latest “Happy Warrior” column with this warning:

A couple of years back, over in The Corner at NATIONAL REVIEW ONLINE, some of the more bloodthirsty lads were demanding to know why Bush didn’t do this and why Bush didn’t do that. I forget what it was now — knock off Assad, freeze Saudi bank accounts, whatever. John Podhoretz responded that we were missing the point, which was this: Bush was as good as it was going to get.

The electors have made a bet that we can return to that happy capering playground at the Summit of the Americas where all the great questions have been settled and indulgent governments can subsidize their own anarchists. If 9/11 ultimately revealed America’s self-imposed constraints, November 4 is already understood as a comprehensive repudiation even of that qualified resolve. Like I said: For America’s enemies, that’s useful to know.

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Today's Carolina Journal Online features

Posted by Mitch Kokai at 06:34 AM

The week's first Carolina Journal Online exclusive features Jay Schalin's report about a recent roundtable discussion about the future of college sports.

John Hood's Daily Journal warns readers to expect some "ugly politics" in 2009 associated with tough economic decisions at all levels of North Carolina government.

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