Paradise Is Too Expensive
In a federal system with competition between states there are winners and there are losers.
Not Even Beautiful Hawaii Is Immune to ‘Tax Flight’
Tax competition and regulatory competition should heat up in the next four years. The elimination of SALT deductibility accelerated this trend; its repeal may slow the process. But, still.
‘Tax flight is when the residents of a state with high taxes leave to go live in a state where the tax burden is lower. The extent to which tax rates directly influence migration patterns is a matter of debate. But the data do demonstrate that people tend to leave higher-tax states in favor of states with lower taxes.
‘For fleeing Hawaii residents, a popular destination is Las Vegas, Nevada, which has no state income tax and now is often called “Hawaii’s Ninth Island,” due to its high number of former Hawaii residents’
Wall Street regulation needs a rethink under Donald Trump
Regulation generally, but financial regulation specifically, needs massive simplification to be effective.
The current regime isn’t working.
The current backup in interest rates could cause some more bank pain. This would reinforce the message of a broken system, even as advocates for bureaucracy demand more regulation to be laid on the rickety foundation that contributed to the weakness in the first place.
‘The US banking system is burdened by a convoluted regulatory architecture, where multiple agencies — federal and state — oversee financial institutions with overlapping jurisdictions and, at times, competing interests.
‘This fragmented structure, originally intended to enhance oversight, often creates inefficiencies, delays and inconsistencies in enforcement. Donald Trump’s incoming administration now has an opportunity to address some of these flaws.
‘The failures of Silicon Valley Bank and First Republic Bank, where regulators shifted blame and acted too late, reveal a system that is reactive rather than proactive. It is time to question more whether this multi-regulator framework truly fosters stability or instead stifles innovation, responsiveness, and accountability.’
Sixth Circuit strikes down new neutrality regulation
Net neutrality is the biggest scalp Loper has claimed.
So far.
‘In the early days of internet commerce, President Bill Clinton’s 1997 “Framework for Global Electronic Commerce” advocated that “governments must adopt a market-oriented approach to electronic commerce, one that facilitates the emergence of a global, transparent, and predictable environment to support business and commerce.” Now that an appeals court has rejected the FCC’s attempt to impose regulatory power over the internet, commerce and other activity on it is once again guided by the market process, and not by regulators seeking to expand their powers.’
What Could Less Regulation Mean for AI?
No matter what the incoming administration does, regulatory room is going to be an issue for AI with the uncertainty acting as a brake on innovation.
‘Even if the Trump administration opts for less regulation, companies will still have to contend with state and international regulations. Several states have already passed legislation addressing AI and other bills are up for consideration.‘
Fundamental Tensions in Building a Department of Government Disruption, Part I, by Daniel Epstein
When it comes to the administrative state, it’s an interesting question as to who is the principal to the agency’s agent. Is it Congress or is it the executive branch?
‘Our present jurisprudence and ideas of reform tend to ignore the reality that Congress and the executive branch have disparate views on who controls the bureaucracy. Some scholars still describe the bureaucracy as “Congressional.” Current constitutional doctrines dictate that whenever an establishment head is nominated by the President and confirmed by the Senate, an executive, rather than legislative, agency exists. And yet establishments that fit that rule – the Government Accountability Office or Library of Congress (both headed by presidentially appointed and Senate-confirmed heads) – have been determined to be arms of Congress.
‘Related to the debates about the proper branch charged with supervising the bureaucracy, scholars get into thorny debates about Congress’s delegation of legislative responsibility to the executive branch. Technically, the argument goes, the delegation is impermissible if the grant of power lacks an intelligible principle; with an intelligible principle, the delegation is simply an authorization of executive power. But what is an intelligible principle? If anything, it is some indicia that Congress remains in an oversight capacity over the agency. In this sense, and consistent with principal-agent theory, Congress cannot delegate to an agency it may not control.‘
Fundamental Tensions in Building a Department of Government Disruption, Part II, by Daniel Epstein
Agencies get to determine their own jurisdiction. They have their own courts, so why is this surprising and disturbing? Because it is.
This derives from a negotiated bargain between the public agency and the special interests in a particular industry. No wonder it protects the incumbents.
‘The federal courts universally defer to agency statements of jurisdiction due to a longstanding precedent from a case that held that agencies are given deference in investigating to determine whether they have jurisdiction. That principle gets it backward, yet the idea that organic statutes must specify an agency’s regulatory authority has never been the law of the land.‘
You would think that it would be the left that exploited public sentiment when it comes to bureaucracy. It’s hard to be a hippie when the man has rules about what kind of granola you can sell at the local farmers’ market.
Yet, here we are.
Here comes the pushback in defence of the civil service. Michael Lewis’ new book, Who Is Government?, will be a powerful shot across the bow.
‘Fears of an undemocratic, overweening bureaucracy haven’t only served as a right-wing talking point. Some of the administrative state’s most pointed critics have been intellectuals on the left, like the anthropologists James C. Scott and David Graeber, each of whom has argued that a domineering bureaucratic state is hostile to local ways of living. But anarchist critiques like theirs are harder to marshal into a mass political movement. In 2015, a time when the Tea Party, a MAGA precursor, was already well underway, Graeber lamented that the right had figured out how to politicize antipathy toward the bureaucracy, deploying the rhetoric of “anti-bureaucratic individualism” to push through a free-market agenda that guts social services while bolstering business interests.’
Alcohol Warning Labels Are Nanny Statism at Its Worst
Water is wet. Excessive consumption of alcohol is unhealthy.
But sure, let’s slap another label on a bottle that already has labels about the ill effects of drinking.
‘Just as Joe Biden is about to exit the presidency, his surgeon general, Vivek Murthy, issued an advisory recommending new labels on bottles of alcohol that link drinking to cancer. Claiming alcohol is a “leading preventable cause of cancer in the United States,” Murthy suspects slapping bottles with cancer warning labels can save up to 20,000 American lives per year.
‘Of course, bottles of alcohol already have government-mandated labels that warn about things like drinking while pregnant and drinking while operating heavy machinery. Most importantly, they warn that drinking alcohol “may cause health problems” — so the fact drinking may be harmful for you is already on the label.’
Good luck trying to get through the environmental reviews necessary for proper timberland management.
‘Yup. When the Forest Service identifies high-risk forests needing prescribed burns, it takes an average of 4.7 YEARS just to get through environmental reviews. For complex projects, it's 7.2 years - longer than many fire cycles.’