From Cato Institute, a discussion of net neutrality.
The debate continues over whether “net neutrality” is the equivalent of old-school utility regulation of telecommunication firms. The President and others are now asking the FCC to treat telecom firms in the same ways telephone companies were treated decades ago. Berin Szoka, president of TechFreedom, comments.
View below, or click here to view at YouTube.
A complicated regulatory landscape for genetically modified foods would shift power to large food producers at the expense of small companies and innovative startups.
Have you ever seen a product that displayed a label that states: “This product contains a chemical known to the State of California to cause cancer and birth defects or other reproductive harm.” And notifying you that you should wash your hands after handling it?
In my case, it was a cable attached to a computer peripheral.
How is that that the State of California “knows” this product is harmful, but none of the other states or the federal government have such knowledge? And why should I — here in Kansas — be discouraged by buying a product and then be scared to use it, just because California believes it is harmful?
The answer is that California has a list of about 900 chemicals that it believes are harmful. If you want to sell a product in California, and if your product contains one of these, you must provide a warning label on your product.
Now, can you imagine the confusion that would result if other states had their own list of chemicals that they believe are harmful. It’s quite likely that each state would have a different list. Complying with the multitude of different harmful lists and labeling requirements would be a burden. It might be impossible — or very costly — to comply.
Today, we have similar potential for regulatory complexity cropping up in the form of state-based label requirements for foods that contain GMOs (Genetically Modified Organisms). Dozens of states are considering their own labeling requirements for food sold within their borders. It’s quite likely that each state would have a different set of labeling requirements. The complexity of complying with such disjointed regulations is costly and forbidding.
To help in this situation, United States Representative Mike Pompeo has introduced legislation that would eliminate the ability of states to require labeling. The bill is H.R. 4432: Safe and Accurate Food Labeling Act of 2014.
The proposed law does not prohibit voluntarily labeling.
What’s interesting is that opponents say this bill will create a new federal bureaucracy to enforce GMO regulations. I suppose that’s true. But it’s either that, or 50 states with 50 sets of regulations, all different. Cities could add regulations, too, further complicating the regulatory landscape.
Another observation: Critics of this bill say its supporters have “sold out” to the large food producer companies, Monsanto being mentioned most prominently. But it is large companies like Monsanto that are best able to cope with complicated regulations. Large companies have fleets of lawyers and compliance officers that can deal with burdensome regulation. And being large, these companies can spread the cost of regulation over a large sales volume.
But small companies, start up companies, and innovators don’t have lots of lawyers and compliance officers. Being small, they can’t spread the cost of regulation over a large sales volume. These are the companies that are most harmed by regulations like those that H.R. 4432 is designed to squelch.
It’s in the interest of large companies to have regulations that create barriers to entry to markets by new competitors. We often see companies lobbying to create such regulations. But H.R. 4432 will create a uniform playing field that is easier and simpler to navigate and obey.
Finally, markets have a remarkable ability to provide the products and information that consumers want. If a food producer senses that consumers want information about the ingredients in a product, they’ll provide it. Their competitors — if they see themselves disadvantaged — will also provide the information that consumers demand. The alternative is relying on 50 sets of government bureaucrats operating in 50 state capitals, plus ambitious city bureaucrats.
By Clyde Wayne Crews
Ten Thousand Commandments is the Competitive Enterprise Institute’s annual survey of the federal 
regulatory state. Authored by CEI Vice President for Policy Clyde Wayne Crews, it shines a light on the large, growing, and hidden costs of America’s regulatory state.
The scope of federal government spending and deficits is sobering, but federal regulations cost hundreds of billions – perhaps trillions – of dollars annually. Unfortunately, they get little attention in policy debates. Regulatory costs are difficult to quantify because, unlike taxes, they are unbudgeted and often indirect. Ten Thousand Commandments compiles scattered government and private data on the numbers and costs of regulations and about the agencies that issue them, in an attempt to make the regulatory state more comprehensible.
Highlights of the 2014 Edition Include:
The New York Times has provided a story on the future of advanced biofuels, using a plant under construction in Kansas as the centerpiece. The plant, near the western Kansas town of Hugoton, produces cellulosic ethanol. Instead of using kernels of corn as input, the plant uses material like corn stalks and wheat straw. When the Hugoton plant starts operations in May, it will be twice as large as the largest plant currently in operation.
A few notes:
The lede of the story: “There is an old joke in the energy business that advanced biofuels are the fuel of the future, and always will be.”
The legislation requiring the use of advanced biofuels (Energy Independence and Security Act of 2007) was the product of a Republican administration.
The executive vice president of Abengoa complains that the government is changing the rules.
Experts are not convinced of the potential of cellulosic ethanol plants to be economically viable.
A Canadian biofuel company wants the EPA to create regulations requiring the use of its product, and to provide incentives.
The Kansas cellulosic plant has received a $134 million loan guarantee from the Energy Department, the same type of benefit the notorious Solyndra company received.
Following is a message from Ann & Phelim Media on the continuing success of the crowdfunding campaign for the Gosnell Movie. I’ve made a contribution, and I hope you do too, as the goal is not yet met.
The movie on Philadelphia abortion doctor Kermit Gosnell has just become the most successful film ever on the Indiegogo crowdfunding website.
Gosnell, a made for TV project on the doctor who is America’s most prolific serial killer, has just smashed through the $900,000 mark — overtaking the previous record holder which had raised $898,000.
Gosnell was convicted of the murder of several live and viable babies at his clinic. It is thought that over a 40 year killing spree he murdered thousands of infants. Gosnell is currently serving several life sentences.
His case became controversial after the trial received almost no media coverage — and sparked allegations of a media coverup.
Gosnell Producer Ann McElhinney said the record breaking success of the Gosnell Movie was a testament to the thousands of small donors who wanted the truth to be covered.
“Dr Kermit Gosnell is America’s biggest serial killer — but there was almost no media coverage of his trial — and then Hollywood — which loves to make movies and TV programmes about serial killers — also decided to ignore the story.
That’s why we decided to crowdfund and it’s also why we have been the most successful project ever. This was the biggest crime in US history, which led to one of the biggest media cover ups. It makes sense that the American public has responded with the biggest ever crowdfunding campaign.”
Co-Producer Phelim McAleer said they were “ecstatic” to have achieved a record breaking amount but warned that they would not be relaxing until they had raised the $2.1m needed.
“We have a fixed funding campaign — which means that if we don’t reach our target, all the money goes back to the contributors.”
Producer Magdalena Segieda said the record breaking amount raised for the project is proof that people are fed up with censorship.
“This sends a message to the media and Hollywood that they need to stop ignoring stories that don’t match their political beliefs. By helping Gosnell smash these records the public are making a very strong statement about their dissatisfaction with media bias.”
More information on the Gosnell Movie crowdfunding campaign can be found at www.gosnellmovie.com.
When the Wichita City Council passed new taxicab regulations in 2012, the focus was on dirty cabs and slovenly drivers who were not acting as goodwill ambassadors for the city. Mayor Carl Brewer said he was “tired” of hearing complaints about drivers.
So the council passed new regulations regarding taxicabs, including the requirement that drivers attend customer service training provided by Go Wichita Convention and Visitors Bureau. Other regulations determine taxicab office staffing levels and level of supervision.
But something very important slipped through the cracks. The Wichita Eagle has reported the city didn’t competently enforce regulations designed to protect passenger safety:
A Wichita taxicab driver now in prison for raping a passenger last year shouldn’t have been allowed to operate a taxi in the first place.
That’s because at the time Bryon Scott Spohn applied for a taxi driver’s license in late 2012, he was on a state sex offender registry for possession of child pornography. A city ordinance that went into effect in July 2012 says a taxi driver’s license shall not be issued to anyone who “is now or has ever been registered as a sexual offender with any state, county or local government.”
Spohn shouldn’t have received a taxi license but did because the new change banning registered sex offenders wasn’t communicated to staff members doing background checks on taxi driver applicants, city officials told The Eagle on Friday. The city has fixed the problem that led to the oversight in Spohn’s case, they said. Taxi driver in prison for raping passenger was on sex offender registry, March 3, 2014
The regulations regarding customer service training were implemented. But the really important regulations? Lack of oversight, says the city.
I wonder: Who is regulating the regulators?
The breach of consumer data at Target has brought the issue of data security in focus. Yesterday a senator called for more protection and accountability for consumers and retailers. The following story from Watchdog.org tells us that government does not want to hold itself to the standards it wants the private sector to observe. There has been legislation proposed. Rep. Diane Black [R-TN6] has introduced H.R. 3731: Federal Exchange Data Breach Notification Act of 2013, whose title is “To require an Exchange established under the Patient Protection and Affordable Care Act to notify individuals in the case that personal information of such individuals is known to have been acquired or accessed as a result of a breach of the security of any system maintained by the Exchange.”
By Eric Boehm
HACKED OFF: Hackers or careless bureaucrats could cause private information to be spilled across the Internet. But the federal government, unlike most states, don’t have to tell users when they have been compromised.
By Eric Boehm | Watchdog.org
Americans who buy health insurance through the federal Obamacare exchange website could have their personal information stolen by hackers and never even know it.
Most of the state-run health exchange websites will be covered by state laws that require notification when government databases are breached by hackers. But there is no law requiring notification when databases run by the federal government are breached, and even though the Department of Health and Human Services was asked to include a notification provision in the rules being drawn up for the new federal exchange, it declined to do so.
Other protections for individuals’ privacy, like the Health Insurance Portability and Accountability Act, or HIPAA, do not apply to the government-run exchange, only to health providers and insurance companies operating within the exchange.
Privacy advocates and cyber-security experts have had concerns about the lack of a federal notification law for years and hope the scrutiny of the Obamacare exchange will finally bringchange.
“The notification requirement is a very important part of overall security,” saidDeven McGraw, director of the Health Privacy Project at the Center for Democracy and Technology. “People should be told when their information is at-risk.”
The lack of a notification requirement is particularly bad for the health insurance exchange website because of all the questions surrounding the site’s security. Poor security, coupled with the website’s high-profile problems, could make it a target for hackers either seeking to steal identities or embarrass the government.
Unfortunately, security is often an afterthought for the government, said David Kennedy, CEO of TrustedSEC, an Ohio-based cyber-security firm. Kennedy has testified before Congress about security threats in the Obamacare exchange and the need for notification laws.
“All we need is something that says if the federal government is breached, all we have to do is alert the public,” he told Watchdog.org. “Healthcare.gov is just one website of hundreds that have had these issues going back through the years.”
Together it creates a possible nightmare scenario. Without strong security on the front end, the hastily built and not fully operational website could become a treasure trove for hackers looking to steal identities. But without any laws requiring that those victims be notified by the federal government users of the Federal health exchange will be in the dark about any potential security breaches of their private data.
When the federal Obamacare exchange was being developed by HHS prior to its troubled launch on Oct. 1, experts told the department that it should include a data-breach provision in its policies for the website even though one was not required under federal law.
The department flatly declined to do so.
The final rules for the exchanges were approved on March 27, 2012, meeting of HHS officials, according to the Federal Register.
The department’s response: “We do not plan to include the specific notification procedures in the final rule. Consistent with this approach, we do not include specific policies for investigation of data breaches in this final rule.”
Since there is no federal notification requirement, breaches of any and all federal databases can occur without the public ever being informed.
The only way to find out a hack has occurred is when the government decides to disclose it — as several federal law enforcement agencies did last month in response to attacks from Anonymous, a group of super-hackers who threatened to take down the FBI website and others.
But hacks that happen behind the scenes —potentially stealing everything from Social Security numbers to Department of Homeland Security watch lists — never have to be reported.
“That’s alarming because there could be a number of federal databases that are compromised already and we don’t know about it,” Kennedy said. “The exchange is part of a bigger problem.”
Federal privacy protections contained in HIPAA also do not apply to the databases created by the federal exchange website, McGraw said, even though health insurers doing business through the exchange must be HIPAA compliant.
In other words, the health plan itself is covered by HIPAA and any breaches of security that affect a consumer who has purchased a specific plan would have to be reported. But the process of choosing and purchasing a plan through the federal exchange — along with any information entered into the federal exchange as part of that process — is not subject to HIPAA protections.
“The problem with the exchanges is that they are such new entities, and they are so unique that existing laws don’t really cover them,” McGraw said.
But 48 states have laws on the books requiring that they give notification to individuals who may have had personal information stolen or leaked from a government database. Many states require that government agencies and departments alert the state attorney general so investigations can be launched.
In states that opted to run their own health insurance exchanges, those laws generally cover security breaches of the exchanges, McGraw said, though it depends on the specific wording of each state law.
Those state laws are how data breaches of several state-level health insurance exchange websites have come to light.
On the federal exchange, such breaches are possible, maybe even likely, since the site was launched without comprehensive testing of the security controls for the system.
A Sept. 27 memo to Medicare chief Marylin Tavernner said insufficient testing of the website before the Oct. 1 launch “exposed a level of uncertainty that can be deemed a high risk,” the Associated Press reported in October.
Even though the federal government does not have to report any breaches of security, at least a few already have occurred.
The most high-profile case so far is that of Thomas Dougall, a South Carolina lawyer who had his personal information accidentally leaked to another person after using the Obamacare exchange last month.
Dougall only found out about that breach of security because the recipient was kind enough to give him a call. Without a requirement that the exchanges report such problems — whether the result of nefarious hackers or glitches in the programming — it is impossible to tell how many other Americans have had their private information released by the federal exchange.
Kennedy said he would not recommend that anyone use the federal exchange until it is more secure and until breaches of security are reported.
“I would say think twice about it, at least until we get more details,” he said.
Kennedy says he supports universal health care and his criticisms of the website are not rooted in political motivations. But the former U.S. Marine whose firm provides computer security to several Fortune 100 companies says there have been “zero changes” to the security of the health insurance exchange website in the run-up to the much-touted Dec. 1 re-launch.
Congress has debated a federal notification law in each of the past three years, but one has never been passed.
David Thaw, a law professor at the University of Connecticut who specializes in cyber-security and the legal framework around it, said data breach notification laws, combined with comprehensive data security, are an essential part of protecting consumers and businesses.
With the federal health insurance exchange, there are questions about whether the vault door has been adequately locked.
But there is no doubt that the back window is still wide open.
Boehm is a reporter for Watchdog.org and can be reached at EBoehm@Watchdog.org. Follow him on Twitter @EricBoehm87
Events in recent months have justifiably caused Americans to ask whether a powerful, activist, and interventionist government and bureaucracy is good to have. Those who have been looking at overcriminalization, however, have known that government and regulatory agencies have been targeting and oppressing Americans for a long time. And it’s getting worse.
The new website USAvsYOU.com holds useful information for Americans to know about how law has changed in recent years, compared to how it operated for centuries before. The booklet available for reading is titled USA vs. You: The flood of criminal laws threatening your liberty.
As an example, here is a troubling trend:
In many criminal laws, the “guilty mind” requirement has been removed or weakened. This means people can go to prison regardless of whether they intended to break the law or knew their actions were in violation of the law.
Traditionally, crimes had two components: (l) mens reu (guilty mind), and (2) actus reus (bad act).
Today, many criminal laws and regulations have insufficient or no mens rea (guilty mind) requirement — meaning, a person need not know that his or her conduct is illegal in order to be guilty of the crime.
An example story is the following:
THE CRIME: Rescuing a baby deer
Jeff Counceller, a police officer, and his wife Jennifer spotted an injured baby deer on their neighbor’s porch. Instead of turning a blind eye to the dying fawn, the Councellers took the deer in and nursed it back to health.
An Indiana Conservation Officer spotted the fawn (named Dani) in the Councellers’ yard — and promptly charged the couple with unlawful possession of a deer, a misdemeanor offense. Fortunately for her, the day that “Little Orphan Dani” was to be euthanized by the state, the deer escaped into the wild. Due to public outrage, the government dropped the charges.
The website and booklet is a product of Heritage Foundation and it partners such as the American Civil Liberties Union. Heritage has been covering the issue of overcriminalization here. It describes the problem as this: “Overcriminalization describes the trend to use the criminal law rather than the civil law to solve every problem, to punish every mistake, and to compel compliance with regulatory objectives. Criminal law should be used only if a person intentionally flouts the law or engages in conduct that is morally blameworthy or dangerous.”
We have problems like this in Wichita, believe it or not. An ordinance passed by the Wichita City Council in 2010 might ensnare anyone visiting city hall, if they happen to have a broad-tip marker in their purse or briefcase:
“Possession of Graffiti Implements Prohibited in Public Places. It is unlawful for any person to have in his/her possession any graffiti implement while in, upon or within one hundred (100) feet of any public facility, park, playground, swimming pool, skate park, recreational facility, or other public building owned or operated by the city, county, state, or federal government, or while in, under or within one hundred (100) feet of an underpass, bridge, abutment, storm drain, spillway or similar types of infrastructure unless otherwise authorized.”
“Graffiti implements” are defined broadly earlier in the ordinance.
If you’re thinking about a career in taxicab driving, be advised that the city has ordinances punishing you if you’re found to have violated these standards: “Fail to maintain their personal appearance by being neat and clean in dress and person” and “Fail to keep clothing in good repair, free of rips, tears and stains.”
The United States government is in the third day of a partial shutdown. It’s quite a coincidence that Chapter 9 of Henry Hazlitt’s book “Economics in One Lesson” talks about government employees right at the time we’re in a government shutdown.
Here, Amanda BillyRock illustrates this chapter of “Economics in One Lesson.” (Click here to view at YouTube.)
You know how on a day when it has snowed or there’s been an ice storm, you hear on the news that “only essential government employees should report to work today.” When I hear that, I’ve wondered “Why do we have non-essential government employees?”
Here’s something that’s a little shocking. I didn’t believe it when I first heard it. The news agency Reuters is reporting that the Environmental Protection Agency — the EPA — has decided that only seven percent of its employees are essential. The others are non-essential. So why do we have them, if they are not essential?
At the Department of Education, only five percent of the employees are considered to be essential and will work during the shutdown. How, I wonder, are we going to educate children during this time?
Do private sector companies have non-essential employees? Of course. But market competition provides a balancing force, a motivation to avoid waste. That’s not present as strongly in government, if at all.
I understand that we depend on government for so many things that during a shutdown — be it partial or whatever — people’s lives will be disrupted. We’re seeing news stories of people showing up at our great national parks, for example, and being turned away because the park is closed. The solution to these problems is to take these products and services away from government and let the private sector operate them.
That’s something that seems very foreign to a lot of people. Take the inspection of airplanes, for example. Right now people are saying that if government inspectors are not available to inspect airplanes, they’re going to crash. Well ask yourself this question. Does an airline strive to operate its airplanes safely only to satisfy government inspectors, or does it wish to protect the lives of its customers and employees, and safeguard its physical assets like the expensive airplanes?
Or consider a meatpacking plant. Does it endeavor to produce safe beef only because inspectors are watching, or because it is concerned for its customers and wants to avoid the terrible publicity and economic harm of a recall?
I’m not saying that beef and airplanes should not be inspected. But they shouldn’t be inspected by government. It’s very difficult to hold government accountable. When we see episodes where government breaks down, such as perhaps government inspectors who might not be doing a good job inspecting beef, the proposed solution is always more money for government. More money for more inspectors and bureaucrats. But, what if we had a private market for inspection services? If there was a failure of inspection, in other words, if a private inspection company was not being thorough, that would become known. The reputation of that company, which is its primary asset, would be harmed. No longer would we trust that company when it says the beef is safe. The company would likely fail, and someone else would provide these services. We can’t really do this with government.
Markets can provide a very strong form of regulation, if we let them work.
To some extent, this happened during the financial crises of 2008. The credit rating services were not owned by government, but they had a government-granted monopoly on providing credit rating services, and many say that their failure to produce accurate assessments of the risks of securities was pivotal in contributing to the collapse. Might it have been different if there was a free market for credit rating services? We don’t really know.
This government shutdown is an opportunity to realize what we really need government to do, what can be better done by the private sector, and maybe even what doesn’t need to be done at all.
It’s a tough battle, though. Last week Nancy Pelosi said there was nowhere to cut. How about this: $325,000 was spent on a robotic squirrel named “RoboSquirrel.” This National Science Foundation grant was used to create a realistic-looking robotic squirrel for the purpose of studying how a rattlesnake would react to it. Can’t we cut that? I’m sure Pelosi would say “what would the scientific researchers do if we didn’t fund this program?” As Hazlitt tells us, they’d do something else. Hopefully something else that the market — that is, you and I — value enough to buy it because we want it, not because government taxed us to pay for it. But we can’t see that right now, while we do see robosquirrel. The seen and unseen, again.
I don’t know. Maybe I shouldn’t be so harsh in my criticism. We did learn that a successful rattlesnake attack on a squirrel involves three steps. First, striking and hitting a prey animal, and that’s usually from only about 10 inches away. Then envenomating the prey animal, and the animal may attempt to escape. Then the rattlesnake must relocate the envenomated prey animal after it succumbs to the venom.
Envenomating. I’d never heard that word before. Maybe we really need to get government back to work after all.