Category: Current Events

There has been a flurry of activity in recent days from food companies responding to consumer demands to improve the quality of their products. New York Times provides a summary:

Chick-fil-A said on Tuesday that within five years it would no longer sell products containing meat from chickens raised with antibiotics…

A growing number of restaurant chains, including Chipotle and Panera Bread, have made commitments to serve meat only from animals raised without antibiotics, and consumers have responded enthusiastically…

Subway announced last week that it would eliminate azodicarbonamide, a chemical that commercial bakers use to increase the strength and pliancy of dough, but, as noted by the consumer crusader Vani Hari, is also used for the same purposes in yoga mats and shoe soles.

And on Tuesday, Kraft said it was taking sorbic acid, an artificial preservative that had come under attack by consumers, out of some individually wrapped cheese slices…

These are pretty exciting times. It looks like the Internet is continuing to help spread information and ignite and amplify voices to demand change in the marketplace. This is exactly what I predicted two years ago when the Internet facilitated a revolution in “pink slime” meat:

Consumers have always been able to demand products that businesses had incentives to supply. But now technology lets us join together in large enough numbers to demand that businesses stop doing sketchy things that they then have the incentives to stop doing, even if the slow-moving, lobby-infested government never says they have to.

It’s not perfect, and sometimes I think this technology also allows the public to unfairly criticize businesses or go too far, but in general I think it’s pretty awesome. Individual consumers are becoming more empowered than ever before, and I’m excited to see what we do next.

The last two years appear to have empowered individuals even further. And this empowerment continues to prove that consumers can make companies respond faster than government can; the FDA has dithered for decades in regulating antibiotic use and only barely took some limited, voluntary steps last year after an alarming CDC report about growing antibiotic resistance. But it seems to be the consumers who have ultimately extracted such “regulation” from a growing number of companies.

It’s hard to overstate how beautiful are these examples of capitalism creating good out of an industry that has long been associated with its underside. I recently read Salt, Sugar, and Fat, which details the last hundred years of companies competing to churn out cheaper, tastier, more addicting – and more health-destroying – products. (Sure, people choose to buy them, and most regulation would probably have been worse, but even the most hardcore libertarian has to at least admit that the Nash equilibria have not been very optimal.) I also recently read Fast Food Nation, which details the last hundred years of companies exploiting information and power asymmetries to hurt agriculture industry employees, pushing me the farthest to the left in my sympathies for labor movements that I have ever been (not that that’s saying much).

But if the twentieth century was marked by food companies competing to win the most customers by lowering the health quality of their products, perhaps the twenty-first century will be marked by food companies competing to win the most customers by improving the health quality of their products. When the customer cared most about price, taste, and convenience, they each tried to outdo each other by piling on more sugar or salt or sourcing chickens raised in the cheapest (and dirtiest) available environment. But when the customer cares more about health, they now try to outdo each other in removing questionable items from their ingredients so that they don’t lose their customers to whoever’s doing more.

This won’t lead to utopia. The consumer is a contradictory, multi-headed beast. Plenty of consumers still want cheap, junk food and will only pay so much for improved health. Even individual consumers do not consistently know what they want in the ever-changing dynamics of food choices. But the recent activism and responses proves there are plenty of relatively painless ways companies can improve their options once the demand shifts the equilibria just enough to make it so. I suspect there is still plenty of low-hanging fruit on this tree.

And one of the key differences is the increase in technology. The Internet allows us to learn more about how companies are creating their foods and what might be problematic about those processes (reducing information asymmetry). The Internet also allows us to group together to amplify our voices loud enough to be heard on these matters, encouraging companies to respond to the slightest worry about a drop in quarterly profits before it even happens (reducing power asymmetry). And that is a beautiful thing.

Last month, the EPA proposed reducing the ethanol mandate in 2014, due largely to unexpected decreases in fuel demand that would force producers to mix increasing percentages of ethanol into a smaller pool of fuel, with potentially dangerous consequences for older engines. News reports are calling it a victory of Big Oil over Big Ethanol, but regardless it’s a good piece of common sense finally coming out of government energy policy that has ignored the consequences of coddling ethanol for far too long. Commentators on the left and the right seem to agree.

Well, the regulation is now up for public comment until January 29, 2014. A quick perusal of the viewable comments shows plenty of pro-ethanol voices pushing to undo the rule, although contra the “Commenter’s Checklist” many of them don’t seem to have actually read the (long and wordy) proposal itself, which explains the rationale for the proposal and makes multiple requests for reasoned or knowledgeable arguments to change them.

I call on all citizens interested in sound energy policy to petition the EPA to keep or even further reduce the proposed mandates, so that we may finally begin to turn the tide against this boondoggle that has damaged the environment and economy for all of us in order to benefit a smaller set of connected energy interests. Read the Proposal And Submit Your Comments Now!

I believe this proposal is not likely to be overturned anyway, but the more voices rise up in support of the reduction, the easier it will be to carry the momentum to Congress to officially do away with the mandates altogether. And while I have no love for the special interests of oil companies either, I am not too concerned about their incidental benefiting from this proposal; electric cars and solar power have their days numbered, anyway.

Here is my comment. I used the multiple uncertainties stated in the report to strengthen my case. Please do not copy and paste it but feel free to use it as a basis for referencing relevant sections of the proposal to write your own. I encourage others with more knowledge about some of the specific environmental and economic costs of ethanol policy to elaborate on those in their comments, and to try to explain how those costs justify the regulation’s waiver authority and how those costs conflict with the regulation’s stated objectives.

I fully support the proposals to lower the RFS levels for 2014, and I fully support the broad interpretation of the waiver language required to justify it. In fact, I believe a broader interpretation that these requirements may “severely harm the economy or environment” would result in requirements that were lowered to 0.

Regarding the objective of “enhanced energy security,” the recent unexpected surge in domestic oil production has already provided far more security than these renewable fuels may ever do. Regarding the objective of “reductions in greenhouse gas emissions,” I believe there is significant uncertainty that ethanol even leads to a net reduction when all the costs and externalities are taken into account. Regarding the objectives of “economic development and technological innovation,” I believe the recent increases in gas mileage and the rise of electric vehicles are contributing more and have the potential to contribute to more innovation and development. Finally, I believe goals of energy security must be balanced with food security. When unpredictable drought strikes, every portion of the food supply that is diverted into fuel exacerbates supply and price shocks for the remaining portion, increasing the potential to “severely harm the economy” as increased food prices increase hardship and poverty both here and around the world.

I would also like to note that reducing the RFS requirements to 0 would fully satisfy the stated desire to “minimize the need for adjustments in the statutory renewable fuel volume requirements in the future,” as it would be unnecessary to reduce the standard further from 0. However, as such a severe reduction is unlikely, please consider the following recommendations regarding the proposed volumes.

Regarding cellulosic biofuels, I believe the proposed requirements are too optimistic due to the stated “common delays” in production ramp-up. Furthermore, even if the range of volumes (8-30 million ethanol-equivalent gallons) is as accurate as possible, I do not believe the Mean value of 17 million should be used, which implies there is a 50% chance that production will be below this value. It is inappropriate to mandate a level with such high odds of failure. I believe the 25th percentile of 12 million is the most appropriate of the options presented in Table II.C-2.

Regarding biodiesel production, I believe the proposed requirement of maintaining the 1.28 billion level is reasonable but perhaps even optimistic due to the likely expiration of the significant $1/gallon tax credit and the stated lack of estimates of production and demand if the credit is not extended.

Regarding ethanol production, I believe the estimates are too optimistic. I believe it is hasty to entirely dismiss E0, which has increasing demand as evidenced by the website pure-gas.org, as well as the record increases in electric car sales, which are essentially equivalent to “E0” as far as ethanol consumption is concerned. I also believe it is imprudent to assume that the very recent “conditions that have led to” the favorable “price relationship” of E85 over E10 will “continue in the future,” due to the historic relationship and a complete lack of explanation of what those new conditions may be and why we should expect it to become a long-term trend (or if it is even a trend at all since data was only available from two states). I also believe it is quite likely that non-ethanol fuel demand will continue to trend lower than currently estimated, and it should be remembered that the whole reason these standards are being lowered is that fuel demand has been overestimated in the past.

For all of these reasons I would support the 25th percentile of 15,084 million gallons as the most appropriate of the presented potential approaches, although I certainly would suggest even lower values for increased security, economic, and environmental benefits to the United States overall.

It is also important to note that a reduction in minimum production requirements does nothing to affect “maximum” production, or rather the potential for higher production levels if consumers demand it. If these renewable fuels are truly cleaner, cheaper, and better as claimed by proponents in many vigorous but shallow comments, reducing the minimum should have no effect as consumers could and would still rush to demand higher volumes via FFV/E85. If, however, these fuels have significant risks in supply, demand, and/or externalities, reducing the minimum could prevent severe negative effects on both the economy and the environment.

I have a set up a page for links I have discovered or bookmarked about Bitcoin at

postlibertarian.com/bitcoin.

(Disclaimer: Includes a shameless referral link for buying them to try to capitalize on the euphoria, not that I expect anyone to use it and at this point I have not bought any myself.)

I think it’s especially fun to track predictions, many of which are being proved true or false rather quickly. Let me know if you have any more or better resources than the ones I have at the link above.

Generally you only hear terrible news about the worsening state of fish in the ocean (I learned about some of it a few months ago). Recently though I have come across a couple encouraging nuggets.

First, a few countries seem to have had some success “rebuilding” their fish stocks in recent years, including the United States, whose seafood catch reportedly hit a 17-year high in 2011, followed by a slight decline but still relatively bountiful harvest in 2012. It appears that a combination of regulations and innovations are proving effective in limiting the overfishing “tragedy of the commons.”

The global picture is still discouraging, but regional successes make a catastrophic collapse in fish stocks seem far from inevitable, even before price signals really kick in.

Second, I learned that coal power plants are a major source of the mercury pollution that makes so many fish dangerous to eat. This increases my interest in recent news that U.S. coal use dropped sharply in 2012 and appears to be slowly continuing that trend in 2013. If coal’s days are numbered as an energy source, that means the negative externality of toxic fish should strongly decrease along with it.

Once again, the global picture is discouraging; coal use is still increasing worldwide. But if the technological advances in alternative energies continue, that won’t matter very much in a decade or two.

None of this necessarily makes me “excited” about government regulation of overfishing or coal, as I’m sure there plenty of inefficiencies and corruptions therein, but I find it hard to get too upset about them, either. And it definitely makes me want to encourage sustainable fishing and The End Of Coal (TM) via market forces and information.

This week was filled with stories about the number of people losing health insurance due to Obamacare rising into the millions, far outpacing any alleged numbers of people gaining insurance due to Obamacare, especially since the healthcare website continues to be plagued by problems stemming from far deeper and complex issues than mere site overload, including (as I predicted) security holes.

This week was also filled with Smart People pundit-apologists contorting themselves into painfully myopic and paternalistic theatrics to defend Obama’s now-infamous “if you like your health plan, you can keep it,” insisting that everybody always knew it wasn’t exactly true and besides, you didn’t really like your health plan anyway because it wasn’t any good. These flagrant elitist diatribes have been so ridiculous that plenty of other commentators have already saved me the work of exposing their futility.

Meanwhile, the website’s “woes” could be undermining the demographics required to make the law function by discouraging those “young and healthy” people that need to start paying lots of money into the system (one also wonders if they’re finally starting to realize they’ve been had). Now vulnerable Democratic senators are trying to delay deadlines and keep old plans from disappearing. The lawsuit arguing that the law does not give the government authority to do subsidies on state exchanges is still advancing. And the Obama administration keeps delaying its release of the number of people who have actually signed up – although we just learned that a grand total of six people got through the first day.

Comparisons have been made to Bush’s Medicare expansion, which got off to a slow and glitchy start. But I think the fundamentals here are far more flawed, the glitches far worse, and the pace incomparable; Obamacare may technically be “ahead” on signup numbers, but only if you ignore all the people losing insurance, too.

Now, I must admit I sort of enjoy seeing the lies “narrow untruths” and misunderstandings come home to roost for the politicians and pundits who spent so much time trying to convince us that the “Affordable Care Act” was better and smarter than the status quo. Although it appears that polling still “has not moved much on Obamacare for literally years now,” and it would be easy to overestimate the importance of all of the current hullabaloo; if things really do end up improving in spite of the mess, I’ll begrudgingly but openly admit it. So far, though, everything is vindicating everything I’ve long believed about the inevitable results of the sheer magnitude and complexity of the law, and the lies, lobbying, and corruption that were required to pass it.

But is there any value to my Schadenfreude? If things don’t turn around, we are stuck with both a worse status quo and the question of what happens next. Part of me wants to hope that a spectacular Obamacare failure (along with the continuing NSA revleations) will lead to a backlash against Big Government, that people will look at this boondoggle and conclude that they don’t want to trust government to be even more involved in their health. And I do expect a little backlash, at least in the short-term. Democrats didn’t have the votes for true universal healthcare when they settled for Obamacare and they certainly don’t have the votes for it now.

But the USA government’s dysfunction, no matter how ridiculous it gets, may never provide a convincing case to move back in the other direction. First, I’m not even sure what the other direction would look like. It’s easy to say people shouldn’t be forced into pre-packaged solutions that include maternity care for 60 year olds; it’s much harder to say that people with pre-existing conditions are doomed to the whims of the market and/or charity (though I’m also not sure if you can make the math and incentives work any other way). I wish the government was doing more to eliminate the information asymmetries and hidden pricings that makes all these costs high enough to be an issue in the first place, but I’m not naive enough to believe that even theoretically perfect information flow would make a perfect free market in healthcare, either.

But more importantly, the “single payer” whispers are growing again. And whether that was by design all along or not, I think it’s pretty hard to argue that “Medicare for all,” while technically even more “socialist,” wouldn’t be better than the corporate-crony-socialism hybrid monster we’ve had for some time (and recently kicked into overdrive), except for that fact that we can’t afford it. Yet there are a whole bunch of other countries that at least appear to have successfully implemented “universal healthcare” systems, which provides eternal fuel for the belief that it must be possible somehow!

So what I have in expectations for the next three years are arguments for how America can be successful with universal healthcare from the same politicians and pundits who spent the last three years arguing that Obamacare would be successful. What I don’t have in expectations is any clue about how well that is going to sell.

Electric cars continue to rise. I still see conservatives hating on them, and as I said a few months ago, I still think that hate is increasingly misplaced.

I still see conservatives hating on electric cars for the government subsidies being poured into them. As I said before, that’s a very good reason to hate on them; the arbitrary favor means we’ll never know what better innovations we might be forfeiting. But I was recently reminded of a similar subsidy for good ol’ oil-and-gas cars that doesn’t tend to generate as much outrage: ETHANOL.

The government’s terribly excessive ethanol subsidies and mandates arguably cause far more damage, and – in the classic spirit of overactive government programs contradicting themsleves – every subsidized electric car reduces the demand for subsidized ethanol. Since ethanol is just so terrible, I find that hard not to celebrate.

I still see conservatives hating on electric cars for the energy it takes to charge the batteries, but it still requires comparing the most energy-efficient oil-and-gas cars to the least energy-efficient electricity sources, which is still an increasingly losing argument.

But there’s one losing argument that might be officially lost. I used to see conservatives hating on electric cars for how poorly they were selling (here’s a random diatribe from April). This was a reasonable argument while the facts supported it; the government was spending a lot of money to stimulate demand for these things and the public still didn’t seem to really want it.

But we may be turning a corner. It appears that the public may really want these things after all.

Electric vehicles barely existed in 2010. Last year’s sales tripled from the year before, and this year’s is on pace to double to somewhere around 100,000. Range anxiety? What range anxiety? Remember the alleged chicken-and-egg problem of not enough demand for electric cars to sustain electric charging stations to sustain demand for electric cars? Well somewhere between the market and the subsidies that seems to be solving itself too:

If these trends continue, the old conservative mocking of such-and-such brand only selling so many hundred models in such-and-such quarter will increasingly look like petty tribal banter. It seems like every week now we hear about a new car manufacturer working on adding an electric vehicle to their lineup; apparently it’s not just Elon Musk that’s onto something with Tesla – which, by the way, is getting ready to release its electric SUV.

Does all this mean the government subsidies were worth it? Of course not. But I said it before and I’ll say it again: Conservatives need to stop arguing we should stop subsidizing electric cars because they’re so bad that they don’t do any good, and start arguing we should stop subsidizing electric cars because they’re getting so good that they don’t need the subsidies anyway. And while we’re at it, let’s cut the cord on ethanol. Although, if we don’t, I’m starting to think electric cars might just do it for us.

Ted Cruz stole the show at last weekend’s Value Voters Summit. His speech was littered with small-government rhetoric about the virtues of “freedom” and “liberty” and “free market values” and the “Constitution” and how Obama is destroying “this great nation” with all his “big government.”

I liked Cruz when I first heard about him. He seemed like he might be a smart, articulate libertarian-ish Republican defender of Constitutional principles and legitimate small government. But the more I heard from him, the more uneasy I became. He seemed too populist, too partisan, too eager to blame Obama for every possible problem in the world, but I haven’t put my finger on what really bothered me about him until now.

I’m sick of fake Republicans talking a big talk about how much they hate “big government” while only ever talking about a small part of it. I know, it’s nothing new, but it really bugs me when I hear it, especially from the Tea Party heroes who are supposed to be better than the establishment leaders.

Don’t talk to me about how much you hate Obamacare. Talk to me about how you want to get the federal government out of Medicare. Don’t talk to me about how much you hate food stamps. Talk to me about how you want to get the federal government out of farm subsidies. Don’t talk to me about gun control. Talk to me about how you want to get the federal government out of corrupt defense contracts and military bases and drone strikes and surveillance (to his credit, Cruz briefly mentioned the last two in the midst of his multiple “Obamacare” tirades).

Talk to me about how you want to get the federal government out of the War on Drugs, out of excessive disability benefits, out of ethanol subsidies and indefinite detention and militarized policing and patent extensions and anything the federal government does that gives even a little bit of help to farmers or seniors or veterans or CEOs or anybody else that looks just a little bit Republican.

Until then, don’t be shocked when leading progressives say things like, “This whole dispute is about the Republican Party fighting to make sure the working poor don’t have access to affordable health care.” You and I both know that’s an outrageous lie; if we really didn’t want the poor to access affordable health care we would support Obamacare full throttle because we think it’s terrible for the poor and everyone else! But until you start speaking out against the parts of Big Government that benefit you, don’t expect them to believe you.

I’ve always preferred to admit a general bias towards small government while allowing for reasonable arguments for various general regulations and interventions. I’ve always thought that was more humble and more likely to find truth than adamantly declaring all government as evil. But what’s far worse than really believing that is to say you believe it and then completely ignore all the parts of government that benefit you and your tribe. When you do that, it’s no wonder your poll numbers are hitting record lows.

The new Obamacare website, Healthcare.gov, officially opened on October 1, when it was immediately greeted by an onslaught on visitors that rendered the site unusable. Liberals trumpeted the millions of visitors as proof of Obamacare’s success (nevermind how many actually signed up or picked plans, as that was probably in the single digits). They attributed the early hiccups to the standard effects of really high traffic that would eventually be resolved.

But the Affordable Care Act site’s troubles run much deeper than just being coded too poorly to prevent empty drop-down menus or including too many javascript files on every page. My experience with the site so far indicates an embarrassingly rushed and incomplete product that I’m hesitant to trust with my personal information.

Only the government would decide to handle heavy traffic levels with a virtual waiting line! Though to be fair, an automatic queueing system is actually a fairly complex and impressive functionality for a website, and though I encountered it every time I visited it usually seemed to update to a log-in screen after a few minutes. But again, heavy traffic is the least of their problems.

Continue reading Yes, The Obamacare Website Really Is Really Bad