The Regulating Game

Our friends at Powerline (does being a Facebook friend count?) offer a link to a Claremont Review of Books review by James Keller entitled, “Is Deregulation to Blame?”  The review is on two texts, A Failure of Capitalism by Richard Posner, and Getting Off Track by John Taylor.  I highly recommend reading the review, as it is deals with the ol’ ‘capitalism is to blame’ theory of this most recent financial calamity and recession.

The topic of financial regulation is one that I find extremely interesting as it parallels many views I have on other issues such as education, welfare, etc.  In this blog I will many times bemoan the lack of accountability to consequences that many government institutions create.  James touches on this in his closing paragraph:

Regulators need not be heroes if creditors have an interest in being vigilant; and creditors will have such an interest if recklessness faces the penalty of real loss. Unfortunately, we have just assured all creditors that their interests will be protected, no matter how reckless they are. (emphasis added)

Regulation is a fashionable word amongst those who despise capitalism and the free market, and even those who just mildly distrust it.  But as this review points out, the very areas that are most heavily regulated are most often the ones with the greatest problems:

The anticipated chain of events was a large hedge fund failing and taking down its lenders in a chain reaction. Instead, the banks failed, threatening the hedge funds. The rush to re-regulate ignores the reality that the least-regulated entities in the system—hedge funds—fared far better than the highly regulated entities like banks and insurance companies.

This article is far too small, and the financial collapse far too large to be covered sufficiently, however a benefit of Claremont reviews is that they are not the one paragraph People Magazine reviews, but longer articles that typically are able to be quite thorough in presenting the case of the author.  I will admit that relying too much on a review versus actually reading the reviewed text itself can be dangerous, so I won’t make any disclaimers about Posner’s or Taylor’s books or the arguments they make… but it is still well worth the read in that it can only serve to perk your interest in this topic and to maybe cause you to look into it a little more.

Whatever your views on capitalism and its evils, this review does provide a quick overview of the problem and offers compelling objections to the claim that the financial sector needs renewed regulation.  I find it ironic that the very regulators who didn’t respond to signals and warnings that existing regulations provided, now are asking for more power and regulations to administer.  As Keller states of Treasury Secretary Tim Geithner, “What in the world had he been busying himself with beforehand?”

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Lack Of Debate

A recurring topic that I have brought up on CAI before regards global warming (see here, and here) and the way that it is presented in the media and culture.  I most often feel that to even suggest a debate is looked upon as the same as holocaust denial.  It’s a frustrating and pointless response, that does nothing to validate the underlying concern.  And stories like this one from Powerline and also Newsbusters, do even more damage to the idea that this is in fact a phenomenon of human cause and that we need to take the drastic steps we are considering.  The Powerline article focuses on this doozy:

The Competitive Enterprise Institute has obtained an EPA study of the “endangerment” to human well-being ostensibly caused by carbon dioxide emissions, together with a set of EPA emails indicating that the study, which concludes that carbon dioxide is not a significant cause of climate change, was suppressed by the EPA for political reasons.

That doesn’t seem honest, especially since it was the EPA that requested the report to validate their proposal.  Another example of this seeming more political then scientific can be found with writers such as Paul Krugman (admittedly not a scientist).  As he says in his latest New York Times op-ed:

To fully appreciate the irresponsibility and immorality of climate-change denial, you need to know about the grim turn taken by the latest climate research.

And what is the research?

The fact is that the planet is changing faster than even pessimists expected: ice caps are shrinking, arid zones spreading, at a terrifying rate. And according to a number of recent studies, catastrophe — a rise in temperature so large as to be almost unthinkable — can no longer be considered a mere possibility. It is, instead, the most likely outcome if we continue along our present course.

Wait, that’s the research you point to… same old descriptors?  Where is the data, where is the title of the new peer-reviewed paper we should be reading? To his credit he does finally mention some statistics:

Thus researchers at M.I.T., who were previously predicting a temperature rise of a little more than 4 degrees by the end of this century, are now predicting a rise of more than 9 degrees. Why? Global greenhouse gas emissions are rising faster than expected; some mitigating factors, like absorption of carbon dioxide by the oceans, are turning out to be weaker than hoped; and there’s growing evidence that climate change is self-reinforcing — that, for example, rising temperatures will cause some arctic tundra to defrost, releasing even more carbon dioxide into the atmosphere.

But who are these researchers?  What about this M.I.T. scientist who disagrees?

Granted, most of us are not scientists and so we need other to try and distill their research into understandable bits for us, but I would be much more open to this possibility if it didn’t seem to come across so much as propaganda.  So I continue to remain skeptical, and will for the foreseeable future until it appears there is more quality answers to the questions that are brought up concerning mans part in our planets changes.

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Convenient II

Powerline has a post that elaborates on a column by Victor Davis Hanson, and slightly along the lines of the Convenient post I wrote earlier, about a seeming double-standard in reporting & condemning scandals or ill-behavior amongst republicans and not against democrats.  VDH wrote a very intriguing column and I highly suggest you check it out.  VDH is not playing sore loser, but genuinely wants equity:

Nor is there any regret whatsoever that liberals of good faith thankfully scrutinize the bad judgment and even criminal activity of wayward conservatives. The problem instead is why we continuously consider liberal transgressions as misdemeanors and their conservative counterparts as felonies.

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