Government – Page 119 – artdiamondblog.com

Stagnation Caused by “Depriving Creative Individuals of Financial Power”

(p. 164) The key to growth is quite simple: creative men with money. The cause of stagnation is similarly clear: depriving creative individuals of financial power. To revive the slumping nations of social democracy, the prime need is to reverse the policies of entrepreneurial euthanasia. Individuals must be allowed to accumulate disposable savings and wield them in the economies of the West. The crux is individual, not corporate or collective, wealth.

Source:
Gilder, George. Recapturing the Spirit of Enterprise: Updated for the 1990s. updated ed. New York: ICS Press, 1992.

“Public Money Was Being Used to Rehab a House, and Later to Demolish It”

“Karen Gadbois,a New Orleans activist, has helped expose corruption within a federally funded program designed to help rebuild the city.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A13) But Ms. Gadbois has a dangerous affection for the city’s shotgun houses and Creole cottages in a place where so much is falling down. She is the daughter of a plaster lather — a textile artist herself, and wife of a painter — and she cannot let the sagging porches and ragged cornices go. They have turned her into a full-time activist.

Lists of homes to which things are going to be done — there are many in post-Hurricane Katrina New Orleans, where nearly 60 percent of the dwellings were damaged in the storm — are red meat for Ms. Gadbois. But this time she did not even need to leave her own house, a rambling, cheerfully messy raised green cottage in the Carrollton section (it took on four feet of water in the hurricane) to know something was terribly wrong with the list of houses NOAH claimed to work on.
“It wasn’t even that the house didn’t exist; the whole block didn’t exist,” Ms. Gadbois recalled. “Something’s not right here. We saw properties that had supposedly been remediated by NOAH coming up to be declared imminent health threats, and then demolished.”
It galled her, she said, that public money was being used to rehab a house, and later to demolish it, often by agencies sharing the same office space.

For the full story, see:
ADAM NOSSITER. “Amid Ruined New Orleans Neighborhoods, a Gadfly Buzzes.” The New York Times (Weds., August 13, 2008): A14.

The Most Fertile Margins of the Economy Are Always in People’s Minds

(p. 151) The most fertile margins of the economy are always in people’s minds: thoughts and plans and projects yet unborn to business. The future emerges centrifugally and at first invisibly, on the fringes of existing companies and industries. The fastest-growing new firms often arise through defections of restive managers and engineers from large corporations or through the initiatives of (p. 152) immigrants and outcasts beyond the established circles of commerce. All programs that favor established companies, certified borrowers, immobile forms of pay, pensions, and perquisites, institutionally managed savings and wealth, against mobile capital, personal earnings, disposable savings, and small business borrowing, tend to thwart the turbulent, creative, and unpredictable processes of innovation and growth.

Source:
Gilder, George. Recapturing the Spirit of Enterprise: Updated for the 1990s. updated ed. New York: ICS Press, 1992.

Government Elevator Inspectors Vote with Their Feet for the Private Sector

“The chief inspection official, Charles Miraglia, works on the side for at least one private elevator company.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A27) More than a dozen members of the New York Housing Authority’s elevator staff — including the official who directs all safety inspections — also work second jobs for private companies in the elevator industry, according to interviews and city records.

The employees, including three managers and nearly half the inspection staff, say their second jobs do not conflict with their duties maintaining the 3,300 elevators in the authority’s 2,600 buildings. Tenant complaints and inspection records indicate that the authority’s elevators are among the worst maintained in the city.
All of the elevator staff members with second jobs, including the chief inspection official, Charles Miraglia, have received a waiver from the city’s Conflicts of Interest Board, which ruled the second jobs did not present an ethical conflict. Each waiver was granted, the board said, based on the endorsement of the Housing Authority chairman, Tino Hernandez, and an assurance from the employee that the job would not interfere with his authority duties.
. . .
Criticism of the way the authority, the nation’s largest public housing landlord, maintains its elevators intensified recently, after a 5-year-old boy died trying to escape a stalled elevator in an authority-owned building in Williamsburg, Brooklyn, on Aug. 19. The Brooklyn district attorney’s office continues to investigate that accident.
. . .
Some of those who received waivers to work a second job said in interviews that they worked only part time, and always after hours or on weekends.
Scott T. Hayes, a longtime elevator consultant and inspector for building owners in the city, said 99 percent of all commercial and residential inspections take place during normal business hours, and almost never on weekends. “If a building super works till 4:30 or 5 o’clock and then they’re off, and you show up at 6 o’clock and say I want to inspect the elevator, he’ll throw you out of the building,” Mr. Hayes said. “So I don’t know what kind of work they could be doing. It doesn’t make sense.”
Mr. Miraglia earns $104,000 a year in his authority post and received his waiver to work outside jobs in August 2007, at a time when the authority’s difficulties in inspecting elevators were already apparent.

For the full story, see:
RAY RIVERA. “Fixing Elevators: For the City, and on the Side.” The New York Times (Tues., September 30, 2008): B1.
(Note: ellipses added.)

The Policy Agenda to Euthanize the Entrepreneur

(p. 151) The agenda is simple: the stealthy and unannounced euthanasia of the entrepreneur. It can be accomplished easily by following two seductive themes of policy: lowering tax and interest costs for large corporations and a few other favored institutions, while shifting the burden increasingly to individuals and families. By reducing corporate taxes, subsidizing corporate loans, sponsoring a wide range of favored borrowers, institutionalizing personal savings, and discreetly allowing taxes to rise on personal income, government can painlessly extinguish the disposable wealth of entrepreneurs.

Source:
Gilder, George. Recapturing the Spirit of Enterprise: Updated for the 1990s. updated ed. New York: ICS Press, 1992.

Houston Rejects Irrational Recycling Fad

Source of graph: online version of the NYT article quoted and cited below.

(p. A13) HOUSTON — While most large American cities have started ambitious recycling programs that have sharply reduced the amount of trash bound for landfills, Houston has not.
. . .
Landfill costs here are cheap. The city’s sprawling, no-zoning layout makes collection expensive, and there is little public support for the kind of effort it takes to sort glass, paper and plastics. And there appears to be even less for placing fees on excess trash.

“We have an independent streak that rebels against mandates or anything that seems trendy or hyped up,” said Mayor Bill White, . . .

For the full story, see:
ADAM B. ELLICK. “Houston Resists Recycling, and Independent Streak Is Cited.” The Wall Street Journal (Tues., July 29, 2008): A13.
(Note: ellipses added.)

Instead of Government Money, Benson “Just Wanted the Opportunity to Compete”

“Jim Benson” Source of caption and photo: online version of the WSJ obituary quoted and cited below.

(p. A10) “A number of people had told me they wanted to start space businesses,” Mr. Huntress says, “but they always wanted government money. Jim said he didn’t want any government money. He just wanted the opportunity to compete. That got my attention.”

Mr. Benson, who died Oct. 10 at age 63 of a brain tumor, put it directly: “If we’re going to space to stay, space has to pay.”

He thought he’d found a business model. “We offer FedEx-like package delivery rides,” he proclaimed in 1999. He imagined getting customers like NASA itself and the armed forces, as well as scientists and industry. Always looking for an angle, he also envisioned a more terrestrial use for his rockets: sending a package from San Jose, Calif., to Taipei in 20 minutes.

With organizational ability he developed at software start-ups in the 1980s, Mr. Benson assembled a team of mostly young engineers plus some NASA veterans and set to work. To avoid high development costs, he used off-the-shelf technologies and designs. He quickly landed several contracts, including one from the University of California at Berkeley for ChipSat, a small satellite built for carrying scientific instruments to study interstellar gas. It cost $7 million to build — peanuts in space bucks — and has continued to function since its 2003 launch.

For the full obituary, see:
STEPHEN MILLER. “REMEMBRANCES; Jim Benson (1945 – 2008); Rocket Man Ran a Proper Business, But Loftiest Plans Were Ill-Starred.” The Wall Street Journal (Sat., OCTOBER 18, 2008): A10.

“The Vast Inefficiencies of Public Sector Airports”

“One aviation expert said the Midway deal was a way to overcome inefficiencies of public airports.” Source of caption and photo: online version of the NYT article quoted and cited.

(p. A16) CHICAGO — Midway Airport is poised to become the first large privately run hub airport in the country, officials said Tuesday, after an investment group bid $2.52 billion to win rights to a long-term lease.
. . .
An aviation expert at the Brookings Institution, Clifford Winston, said he saw the deal’s attractiveness as helping to overcome “the vast inefficiencies of public sector airports.”
“The Midway experiment is important,” Mr. Winston said, “but it’s only a tiny step.”

For the full story, see:
SUSAN SAULNY. “In Chicago, Private Firm Is to Run Midway Airport.” The New York Times (Weds., October 1, 2008): A16.
(Note: ellipsis added.)

No Fooling: Government Plants Dead Trees

(p. A25) Years ago, when I was a reporter, I remember getting a call from a woman in the Bronx who was screaming: “They’re over on Moshulu Parkway planting dead trees!”

A city work crew was, sure enough, digging holes along the side of the street and carefully sticking in brown and dried-up pieces of foliage. The men claimed the trees had simply lost their leaves for the winter — an explanation somewhat undermined by the fact that they were evergreens.
I’m telling you this because on Tuesday I was talking with a high-ranking Obama administration official about the stimulus plan. “There will be a dead tree planted, figuratively speaking,” he said somberly. “That will happen.”

For the full commentary, see:
GAIL COLLINS. “The Dead Tree Theory.” The New York Times (Thurs., February 25, 2009): A25.
(Note: the online version is dated Feb. 26, and has some substantial differences from the midwest print edition version I have, though there are only minor differences in the brief passages quoted above, which agree with my print copy.)

Vaclav Klaus: The Czech Republic’s Free Market Crusader

“President Vaclav Klaus of the Czech Republic is known for his economic liberalism.” Source of caption and photo: online version of the NYT article quoted and cited below.

(p. A6) To supporters, Mr. Klaus is a brave, lone crusader, a defender of liberty, the only European leader in the mold of the formidable Margaret Thatcher. (Aides say Mr. Klaus has a photo of the former British prime minister in his office near his desk.)
. . .
As a former finance minister and prime minister, he is credited with presiding over the peaceful 1993 split of Czechoslovakia into two states and helping to transform the Czech Republic into one of the former Soviet bloc’s most successful economies.
But his ideas about governance are out of step with many of the European Union nations that his country will lead starting Jan. 1.
While even many of the world’s most ardent free marketeers acknowledged the need for the recent coordinated bailout of European banks, Mr. Klaus lambasted it as irresponsible protectionism. He blamed too much — rather than too little — regulation for the crisis.
A fervent critic of the environmental movement, he has called global warming a dangerous “myth,” arguing that the fight against climate change threatens economic growth.
. . .
Those who know Mr. Klaus say his economic liberalism is an outgrowth of his upbringing. Born in 1941, he obtained an economics degree in 1963 and was deeply influenced by free market economists like Milton Friedman.
Mr. Klaus’s son and namesake, Vaclav, recalled in an interview that when he was 13, his father told him to read Aleksandr Solzhenitsyn to better understand Communism’s oppressiveness.
“If you lived under communism, then you are very sensitive to forces that try to control or limit human liberty,” he said in an interview.

For the full story, see:
DAN BILEFSKY. “A Fiery Czech Is Poised to Be the Face of Europe.” The New York Times (Tues., November 25, 2008): A6.
(Note: ellipses added.)

“Government Interventions Only Prolonged the Crisis”

The comments of Maart Laar, former prime minister of Estonia, are worth considering:

(p.A13) It is said that the only thing that people learn from history is that people learn nothing from history. Looking at how the world is handling the current economic crisis, this aphorism appears sadly true.

World leaders have forgotten how the collapse of Wall Street in 1929 developed into a world-wide depression. It happened not thanks to market failures but as a result of mistakes made by governments which tried to protect their national economies and markets. The market was not allowed to make its corrections. Government interventions only prolonged the crisis.
We may hope that, even as we see several bad signs of neo-interventionist attitude, all the mistakes of the 1930s will not be repeated. But it is clear that the tide has turned again. Capitalism has been declared dead, Marx is honored, and the invisible hand of the market is blamed for all failures. This is not fair. Actually it is not markets that have failed but governments, which did not fulfill their role of the “visible hand” — creating and guaranteeing market rules. Weak regulation of the banking sector and extensive lending, encouraged by governments, are examples of this failure.

For the full commentary, see:
MART LAAR. “Economic Freedom Is Still the Best Policy.” Wall Street Journal (Fri., FEBRUARY 13, 2009): A13.