Another unintended consequence of Dodd-Frank: Higher energy costs?

John Siciliano of the Washington Examiner reports concerns that the federal government’s recent financial regulations could raise your energy costs.

The Commodity Futures and Trading Commission, the nation’s lead financial market watchdog, appears to have gotten the message from energy companies that sweeping new financial regulations that the agency is rolling out could drive up energy costs for consumers if not handled correctly.

Commission Chairman Timothy Massad on Tuesday addressed the regulations that his agency has been charged by Congress to craft in response to the 2008 Wall Street financial collapse.

“I … know the regulatory change is a challenge for you,” Massad said at the Natural Gas Roundtable energy industry forum in Washington. “And as someone who spent many years in the private sector as a lawyer advising businesses that are trying to plan investment and trying to plan strategies, I appreciate the value of predictability and certainty in regulation. And I’m committed to trying to provide that as much as possible.”

The primary concern for natural gas and utility industries is the commission’s new rules for policing the “swap” markets, which until the collapse on Wall Street had served energy companies and other commercial end users “very well,” he said. “But we saw in 2008 how certain parts of the swaps market generated excessive risks that were not well understood.”

Swaps are basically contracts between two or more groups that define an exchange of one item for something else. In the case of the energy industry, they are used to manage fuel purchases to hedge volatility as prices change and costs move up and down. A utility could purchase a swap contract for natural gas or electricity over a specified time that locks in a certain price. Mortgage default swaps are the financial instrument that led to the Wall Street collapse, as banks used the swaps to hedge against the risk of mortgage holders defaulting on their loans.

The Dodd-Frank financial reform legislation, intended to reform the financial industry, set into motion the regulations for the swap markets. The energy industry said the broad language in early versions of the rules would not have differentiated between the swap markets, pulling the energy markets in along with everything else.

The new regulations — meant to regulate how the banks use swap markets — could pose challenges for how energy companies use them too, potentially raising the cost of doing business and leading to higher energy costs for consumers, industry groups have argued.

Stossel labels college a ‘scam’

John Stossel‘s latest column at Human Events explains why he’s unconvinced that college makes sense for most young people.

College has become a scam.

Some students benefit: those with full scholarships and/or rich parents so they don’t go deep into debt, those who love learning for its own sake and land jobs in academia and those who get jobs that require a college credential.

But that’s not most students.

Half today’s recent grads work in jobs that don’t require degrees. Eighty thousand of America’s bartenders have bachelor’s degrees.

Politicians such as Hillary Clinton promote college by claiming that over a lifetime, college graduates “earn $1 million more.” That statistic is true but utterly misleading. People who go to college are different. They’re more likely to have been raised by two parents. They did better in high school. They’d make more money even if they never went go to college.

Economist Bryan Caplan argues that there isn’t much evidence that college grads are paid more because they learned anything at college that is valuable to their jobs.

Getting into elite universities and graduating from them is mostly a “signaling” device, he says. It tells employers you’re a smart person, so employers can begin teaching you things you really need to know. Employers, not the colleges, turn out to be the ones making students valuable contributors.

This suggests college is more like a hurdle than an investment. It would be better if companies found cheaper ways to screen for talent than four years of college.

Surprise, surprise: The ‘Science Guy’ doesn’t understand the Constitution

Bill Nye, “The Science Guy,” whose grasp of science is questionable, also seems to lack a basic understanding of the U.S. Constitution, as Michael Bastasch reports for the Daily Caller.

“Well, first of all, I think denying climate change is in nobody’s best interests,” Nye told Vox in a recent interview. “But I also think denying science in general is in no one’s best interests.”

“When you have people denying this basic process, and how we all got here, it’s offensive to me intellectually,” Nye added. “And I happen to think it’s unpatriotic. Article I, Section 8 of the Constitution says the government shall ‘promote the progress of science and useful arts.’”
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“So if you’re a politician looking to derail the progress of science, I think you’re not doing your job,” Nye said. “I want voters and taxpayers to recognize this. Do you really want to vote for somebody who doesn’t believe in the scientific method — and doesn’t believe that we defeated smallpox? Do you really want that person running your government?”

Nye’s invocation of Article 1, Section 8 to shame lawmakers skeptical of global warming — basically a tactic to shame Republicans — omits a key part of the section that sort of ruins his point.

Here’s Section 8 in its entirety: “To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”

The clause does not relate to Congress deferring to the scientific method, but rather it allows lawmakers to create a system of patents and copyrights for inventors. In fact, this part of Section 8 is referred to as the “Copyright Clause.” It is not in fact called the “Scientific Method Clause.”

Heritage voting expert says new A.G. gets an early test

Hans von Spakovsky of the Heritage Foundation explains for National Review Online readers why he’s watching with interest for new U.S. Attorney General Loretta Lynch’s response to a current voting rights case.

A May 8 decision of the Ninth Circuit Court of Appeals has given new attorney general Loretta Lynch her first public test: Will she break from Eric Holder’s policies by enforcing voting-rights law on a race-neutral basis, as Congress intended, or will she continue Holder’s non-neutral enforcement policy?

For those who don’t remember, in 2011 the Center for Individual Rights and J. Christian Adams filed a lawsuit against the U.S. territory of Guam on behalf of Arnold Davis, a retired Air Force officer. The suit alleged blatant racial discrimination by the territorial government after it had refused to allow Davis to register for a plebiscite over Guam’s future relationship with the United States because he is white. Only individuals considered “Native Inhabitants” were allowed to register to vote with the “Decolonization Registry,” a policy that excluded the majority of Guam citizens who are of Western European, American, African, Asian, and Pacific-Islander descent, since only Chamorros, the racial designation given to the natives who originally inhabited Guam, are considered “Native Inhabitants.”

Guam’s refusal to allow Davis to register based on his race seemed on its face an obvious violation of the Voting Rights Act (VRA), the Fifteenth Amendment, and the equal-protection clause of the Fourteenth Amendment. However, when Davis complained to the U.S. Justice Department, which is responsible for enforcing the VRA, the Justice Department refused to sue Guam or to intervene on Davis’s behalf. A federal district-court judge in Guam held that Davis had no standing to file a lawsuit because he had not yet suffered any injury, and that his claim was not ripe because the plebiscite had not yet been scheduled at the time.

Fortunately, a three-judge panel of the Ninth Circuit disagreed, holding that Davis had asserted a judicially cognizable injury, and that his claim was ripe. As the Ninth Circuit panel explained, “Davis’s allegation — that Guam law provides a benefit to a class of persons that it denies him [the right to participate in a registration process that will determine whether a plebiscite will be held] — is ‘a type of personal injury [the Supreme Court has] long recognized as judicially cognizable.’” It’s an injury that the federal judge in Guam, Frances M. Tydingco-Gatewood, would never suffer: She is Chamorro, as she proudly notes in her official biography. …

… The Justice Department’s refusal to enforce the VRA in Guam was in keeping with its practice under Eric Holder of refusing to enforce the Voting Rights Act against racial minorities, no matter how egregious the violation. But this case is now back before Judge Tydingco-Gatewood, and we have a new attorney general.

It will be interesting to see whether Lynch instructs her office to intervene on behalf of Davis to help stop the unabashed racial discrimination being practiced by the territorial government.

Goldberg pans Huckabee’s ‘progressivism’

Jonah Goldberg explains in his latest column at National Review Online why he believes former Arkansas Gov. Mike Huckabee might have worked well with progressives from days gone by.

Huckabee has always struck me as a right-wing populist-progressive. A deeply religious — and by all accounts decent — man, Huckabee nonetheless has a view of the state that would have jibed almost perfectly with such forgotten titans of the Progressive Era as Richard Ely, Josephus Daniels, and even William Jennings Bryan.

Ely, a mentor to Woodrow Wilson and Teddy Roosevelt and the founder of the “Wisconsin school” of progressivism, believed that “God works through the state in carrying out His purposes more universally than through any other institution.” It “is religious in its essence,” and “a mighty force in furthering God’s kingdom and establishing righteous relations.”

Daniels, Woodrow Wilson’s secretary of the Navy, was a devout Evangelical who banned alcohol (and condoms) from the service. At Daniels’ insistence, officers were forced to replace wine with coffee in the officers’ mess. They took to calling their replacement beverage “a cup of Josephus,” which was quickly shortened and immortalized to “a cup of Joe.” Daniels ordered that prostitutes be kept five miles from every port, and with the aid of a young assistant secretary of the Navy, Franklin D. Roosevelt, oversaw a heavy-handed crackdown on homosexuality at the Naval Training Station in Newport, Rhode Island. Their tactics were so unseemly, Congress rebuked them both in 1919.

Bryan, the dashboard saint of populists for the last century, largely for his assaults on monied elites and his opposition to World War I, had no problem imposing his values on others — at home and abroad. After Prohibition was passed, he proclaimed, “Our nation will be saloonless for evermore and will lead the world in the great crusade which will drive intoxicating liquor from the globe.”

Huckabee isn’t as severe as the progressives of yore, but the same impulses are there. When he was governor of Arkansas — and on a weight-loss kick — he wanted Arkansas schools to track the body-mass index of students. In 2007, he favored a national ban on smoking and argued that we have a Biblical duty to fight global warming. In 1992, he told the Associated Press, “I feel homosexuality is an aberrant, unnatural, and sinful lifestyle, and we now know it can pose a dangerous public-health risk.”

New Carolina Journal Online features

Dan Way reports for Carolina Journal Online on the politics and principles of North Carolina’s certficate-of-need debate.

John Hood’s Daily Journal highlights the importance of ideas in guiding historical events.

Durham wants me to pay rent on something I already own

screwedI got a letter yesterday from Donald Long, the director of Durham’s Solid Waste Management department. In that letter he gave me, and everyone in Durham, I imagine, the good news that the city would begin, on July 1, charging a $1.50 per month rental fee for those large brown containers you fill with leaves, branches, and grass clippings. But here’s the problem: I bought mine from the city about 10 or 12 years ago.

Here’s what Mr. Long wrote in his letter:

We have one additional change to share with customers who purchased their cart in previous years. Effective July 1, all carts now have a rental fee regardless of past purchase history. This means that yard waste customers who were paying $6 per month ($72 per year) will now be charged an extra $1.50 per month for their cart rental, for a total of $7.50 per month ($90 per year).

Keep in mind that Mr. Long is telling me that he wants to rent me my container, which he readily admits I may have purchased previously.

I mentioned this to Roy Cordato, vice president for research and resident scholar at the John Locke Foundation, and an economist par excellence. “That’s just a property tax,” he exclaimed, pointing out that they wanted to put a rental fee on something that I owned.

And since localities can’t willy nilly create new property taxes without a vote of the local governing body, not to mention without being given the authority by the state legislature, this “rental fee” seems a bit dubious to me.

I have notified my neighbors, via our neighborhood listserv, of this, and have copied a couple of members of the city council.

Now, here’s the kicker. Mr. Long, in response to numerous queries about this policy, wrote in an email to the Trinity Park listserv:

We truly regret the implied financial imposition to subscribers who purchased carts, but once you purchased your cart we still provided replacement and maintenance service for the cart. Every year the cart depreciates and depending on when you purchased your cart you may have gotten the purchase value out of the cart already and we will continue to provide the replacement and maintenance service. The reasons for the changes are twofold. First of all the program had to at least pay for itself since we can’t ask taxpayers who don’t subscribe to supplement the cost and secondly, we had a strong need to change our billing system in order to get all of our subscribers on one payment schedule for the sake of efficiency. I hope I’ve made this understandable, but if not feel free to contact me directly.

My question: Since when did the City of Durham give a whit about asking taxpayers who don’t subscribe to a service to supplement the cost of that service to those who get it? That’s the backbone of politics in Durham.

(Cross-posted from Right Angles)

Obamacare will lead to fewer ER visits–or more ER visits

Since it was passed back in 2010 we have been told that the Affordable Care Act would lead to fewer emergency room visits because more people would be covered by both private insurance and Medicaid. Well, after more than a year of expanded coverage under Obamacare ER visits are on the rise. And we are told what by the Asheville Citizen Times? That it’s because of Obamacare. In fact we are told that without any sense of irony.  According to the Citizen Times:

Visits to hospital emergency rooms are on the rise in the Carolinas and around the country, with experts pointing to the physician shortage and Obamacare as possible reasons.

It goes on to point out that:

Nearly three in 10 ER doctors in the survey said visits have increased significantly since the Affordable Care Act, also known as Obamacare, took effect. More than half also said the number of Medicaid patients being seen in the ER has grown, according to the report released this month.

Hmmm. We all thought that being covered by Medicaid was going to get people out of the ER and into the doctor’s office.

Since the Affordable Care Act, or ACA, took effect, about 16.9 million Americans have gotten insurance, either through the state and federal marketplace set up under Obamacare, through expanded Medicaid coverage, or other insurance, according to RAND. That might account for at least part of the increase in states that expanded Medicaid coverage, experts say.

This is just all so confusing. Could the Citizens Times be telling us that Obamacare is actually having an effect that is the opposite of what we were told and what was originally intended? Well, I just can’t believe that.