China Falters on Economic Liberalization

Is China’s economy more of a paper tiger than an Asian tiger?

Dan Mitchell:

Video on CNBC is embedded in there.

1. China’s economy is weak because of insufficient liberalization.

2. Trump’s unthinking protectionism hurts both sides, but China may be more vulnerable.

3. China’s cronyism presents a challenge for supporters of unilateral free trade.

4. Trump should have used the World Trade Organization to encourage Chinese liberalization.

5. The imperfect Trans-Pacific Partnership was an opportunity to pressure China to reduce cronyism.

6. Additional Chinese reform is the ideal outcome, both for China and the rest of the world.

 

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“Deregulation”. Coded Language for What?

Says Senator Elizabeth Warren (D-MA):

Deregulation is code for ‘let the rich guys do whatever they want’ … The Trump administration and an army of lobbyists are determined to rig the game in their favor, to boost their own profit, the cost of the consumer be damned.

But deregulation opens markets to competition because existing regulations protect existing businesses from competition. And competition brings more choices with many price points.

Hemp was deregulated in December, 2018 as part of the Farm Bill. It was removed from the list of controlled substances. Existing businesses operated in regulated markets, illegally — so strict were the regulations that the product was banned.

Now,

Hemp’s return to farm fields this spring coincides with a surge in demand for cannabidiol, a derivative of hemp or marijuana that has become a popular additive in drinks, foods and dietary supplements. Proponents say it relieves anxiety, inflammation and other maladies without the psychotropic ingredient that delivers a high to marijuana users.

Farmers and processors believe growing demand for cannabidiol will turn hemp into a lucrative cash crop.

… Hemp flourishes in rocky soils inhospitable to other crops. It also represents a new potential revenue stream for tobacco farmers abandoning that crop. Other growers are eager to diversify away from mainstream crops after several years of low prices spurred by a production glut and trade tensions.

… Growers can earn $200 to $400 an acre growing hemp for use in textiles, plastics, insulation and construction materials, according to Rodale Institute, a farming research agency. Hemp grown for cannabidiol could earn farmers thousands of dollars an acre, according to the institute. Farmers earned net profits of around $11 per acre for soybeans and lost $62 for corn in 2017, federal figures show.

… Processors in the U.S. also are expanding. Folium Biosciences is building a $30 million, 110,000-square-foot hemp extraction facility in Colorado to increase its capacity 10-fold, said Chief Executive Kashif Shan.

 

Chris Edwards:

Hemp regulations were bad for the economy, they did restrict freedom, and they made life harder for farm businesses. So Warren’s logic would only make sense to someone smoking a big, greasy cigarette of hemp’s sister species.

 

Democrats Against Affordable Health Insurance

Betsy McCaughey:

The outrage is that people who live in New York, New Jersey, California and other states dominated by Democrats can’t take advantage of these deals. Blue states are doubling down on ObamaCare, refusing to allow consumers other choices.

Welcome to the Democrats’ health care prison.

 

But, better choices are available if you live in other states.

Fortunately, President Trump is using his regulatory power to accomplish precisely what these states want: relief from ObamaCare’s rigid regulations.

It would be better if the rules were codified by law.

 

Regulate Big Tech — You Sure About That?

Europe’s Global Data Privacy Regulation went into effect last year had the expected effect of introducing uncertainty into businesses operating in those countries. Once they figure out a legal interpretation, they’ll proceed by either adopting the regulations or leaving the business altogether.

Of course, the big technology firms will get bigger because they can comply with the regulations, and indeed, help shape “enhancements” to them to better suit their business model. Another reason is that once the firms develop the new procedures for the new regulations, they’ll be able to adapt them to the U.S. at low cost and time. The result will be more dominant existing big tech firms.

Don’t be lured by Democrats or Republicans who promise to reduce big tech’s influence in your life, the economy, or society. Those Democrats and Republicans will benefit from the lobbying and control they’ll accumulate.

Tech writer Andrea O’Sullivan elaborates.

This is a statue in Washington D.C. depicting man holding back unrestrained commerce. In reality, the man is a delusional politician or bureaucrat, and the horse are the people making a living.

Restraining Commerce - Constit Ave

Regulate Big Tech?

Ah, no. Can we trust elected officials and regulators to even know how to regulate or restrict the activities of Amazon, Facebook, Google, Instagram (owned by Facebook), Apple, Twitter?

F.H. Buckley: 

Let’s start with the left’s version of this argument. Critics like former Labor Secretary Robert Reich point out that Big Tech is too big, that Silicon Valley’s vast wealth gives it too much political clout. It’s a complaint that recalls the trust-busters of a hundred years ago.

Yet the threat of government intervention is going to give us more, not less, money in politics. Microsoft went into lobbying overdrive following a 1999 breakup order, and it’s vigilance against government intervention that impels Google to spend $17 million a year on lobbying.

. . .

Now let’s turn to the right’s Big Tech anxieties. What really bothers conservatives is the liberal bias of the social-media giants. Mainstream conservatives have been banned on YouTube and “shadow-banned” on Twitter. Terrible, yes, but the proposed cure would be worse than the disease.

When politicians have taken it upon themselves to promote “balanced” speech, it’s been a disaster for conservatives. Until 1987, the Federal Communication Commission’s fairness doctrine required broadcasters to provide honest and balanced viewpoints, and that’s what kept the Rush Limbaughs off the air. But that’s just what conservatives are now asking for when it comes to Big Tech.

They’re asking the swamp to regulate Big Tech, and not just the swamp but the deepest of swamp-dwellers: Democratic pol­iticians who themselves have tried to silence opponents — as they did when they asked Lois Lerner’s IRS to slow-walk approving tax-exempt status for Tea Party groups. Why would conservatives trust the same crowd to promote free speech online?

 

Farm Bill Socialism in Senate

 

Republicans have criticized the socialism of Democrats such as Rep. Alexandria Ocasio-Cortez, but they should reflect on their own party’s socialist vote in the Senate yesterday. The upper chamber voted 87-13 for the bloated monstrosity known as the farm bill, which funds farm subsidies and food stamps. Republicans in the Senate voted in favor 38-13.

I’m less worried about the food stamp wealth distribution. After all, it is part of a safety net in a market economy. Its the corporate and industry control that is more worrisome: ” 807 pages of legalese laying out excruciating details on crop prices, acres, yields”. It also pays wealthy landowners who live in a city but qualify for subsidies because they finagle the rules that say they are farmers.

Some Republican hypocrites listed. But it is a bipartisan freak show.

 

U.S. State Comparison: FL, IL

Nancy Smith:

On a day when an editorial in the venerable Chicago Tribune newspaper is making national news for pleading with Illinois lawmakers to clean up the state’s fiscal mess, it’s a good time for Florida to count its blessings.

. . .

Right now, on the basis of its solvency in five separate categories, Florida ranks 4th among U.S. states for fiscal health, behind only Nebraska, South Dakota and Tennessee.

. . .

Illinois, on the other hand, ranks 50th — dead last and apparently in real trouble.

 

To be sure, fiscal policy at the state level is only one measure of economic health. Economic regulations, personal safety, rights also matter. Local government activity has an impact as well. Several localities raised taxes to pay for increased teacher pay and more police. Unfortunately, higher pay does not equate higher student competency.

It is scary that a far-left candidate for governor lost his race by a few thousand votes out of millions cast. Even with a GOP legislature, the governor controls a vast bureaucracy with which to implement policy.

One thing on the docket is for state-level elected officials need to write the regulations on marijuana legalization.

Report here.