Posts tagged ‘Capitol Hill’

When Microsoft Was Forced to Join the Corporate State

Via Radley Balko.  He is quoting Tim Carney in turn

People think money drives politics. It doesn’t. Money is merely the vehicle. Power drives Washington. As Carney points out, Hatch has spent a good deal of his time on the Judiciary Committee targeting Microsoft. So he wasn’t mad that the company wasn’t giving him money—they weren’t giving to his opponents, either. Hatch was angry that the company wasn’t acknowledging that it needs Washington, that it needs people like him. He finds that offensive. So people like Hatch make companies like Google need people like Hatch.

More:

 . . . it grated on Hatch and other senators that Gates didn’t want to want to play the Washington game. Former Microsoft employee Michael Kinsley, a liberal, wrote of Gates: “He didn’t want anything special from the government, except the freedom to build and sell software. If the government would leave him alone, he would leave the government alone.”

This was a mistake. One lobbyist fumed about Gates to author Gary Rivlin: “You look at a guy like Gates, who’s been arrogant and cheap and incredibly naive about politics. He genuinely believed that because he was creating jobs or whatever, that’d be enough.”

Gates was “cheap” because Microsoft spent only $2 million on lobbying in 1997, and its PAC contributed less than $50,000 during the 1996 election cycle.

“You can’t say, ‘We’re better than that,’ ” a Microsoft lobbyist told me on Friday. “At some point, you get too big, and you can’t just ignore Washington.”

You know what happens next . . .

After the Hatch hearings, Microsoft complied. Its PAC increased spending fivefold in each of the next two elections. In the 2010 elections, Microsoft’s PAC contributed $2.3 million to House and Senate candidates. The PAC has contributed the maximum $10,000 to each of Hatch’s last two campaigns.

Back before the antitrust case, Microsoft’s tiny lobbying contingent sat in the company’s local sales office in Chevy Chase. Since the Hatch hearings, Gates’ company has poured more than $100 million into K Street’s economy, hiring up members of congress and Capitol Hill staff, many of whom then became top fundraisers — such as Republican Jack Abramoff and Democrat Steve Elmendorf.

And of course now that Microsoft has a strong Washington presence, it uses its influence to lobby the government to harass its competitors. Like Google, which must then open its own Washington lobbying outfit in response. And the cycle starts all over again. (If you’re really on your game, you then hire the government regulators you’ve lobbied to investigate your rival to come work for you.)

Money is not the problem in politics, and is not the root of the corporate state.  Power is.  Money in politics will never go away as long as the government has the power to micromanage winners and losers.  Take the power away, and the money would disappear.

Anti-Consumer Trade Policy

I have to reprint this Carpe Diem post nearly in its entirety.  Mark Perry does some editing on a Harold Meyerson WaPo article:

"This week, committees on both sides of Capitol Hill will plumb the conundrum of Chinese currency manipulation. The conundrum isn't that -- or why -- China is manipulating its currency: By undervaluing it, China is systematically able to underprice its exports, putting American (and other nations') manufacturing consumers and businesses that purchase China' cheap imports at a significant disadvantage. The conundrum is why the hell the United States isn't doing thinks it should do anything about it.

There are certainly plenty of senators and congressmen -- and Main Street Americans U.S. producers that compete with China -- who'd like to see the White House place some tariffs taxes on American consumers and businesses who purchase the underpriced low-priced Chinese imports. If the administration doesn't act, Congress may just consider mandating some tariffs punitive taxes against American consumers and business on its own."

Accountability?

From New York Magazine

The wrinkly old men that we elect to Congress are so horny and gross that the American taxpayer shells out on average $1 million a year in settlements to sexually harassed Hill staffers, according to the Office of Compliance. The level of perviness fluctuates from year to year "” in 2007, 25 staffers were paid a total of $4 million.

Kids Prefer Cheese comments

Wouldn't such settlements possibly be of interest to voters, the media, and opponents of the crotch-grabbing perv-boys? It sure would! And that is why Congress passed a law saying that no one can obtain this information!

Via the South Bend Seven.  The New York article also makes this observation:

According to the same Office of Compliance, which is on a roll today, "the Capitol and other congressional buildings are rife with fire traps and other pervasive problems of age and dangerous design, with an estimated 6,300 safety hazards lurking on Capitol Hill this Congress." Congress has exempted itself from federal workplace safety regulations, so it isn't legally obligated to repair any of these hazards, many of which will be expensive. It's the kind of short-sightedness we've all come to expect from our lawmakers.

It is irritating that they exempt themselves from the same laws everyone else has to follow, though I can't say I am too worked up at the thought of some Senator slamming his or her head on a low doorway.

Tort Lawyer Full Employment Act

From Walter Olson, on the House health care bill:

Contacts on Capitol Hill inform me that Republicans yesterday managed to block a remarkable provision that had been slipped into the House leadership's 794-page health care bill just before it went to a House Ways & Means markup session. If their description of the provision is accurate "” and my initial reading of the language gives me no reason to think it isn't "” it sounds as if they managed to (for the moment) hold off one of the more audacious and far-reaching trial lawyer power grabs seen on Capitol Hill in a while.

For some time now the federal government has been intensifying its pursuit of what are sometimes known as "Medicare liens" against third party defendants (more)....

The newly added language in the Thursday morning version of the health bill (for those following along, it's Section 1620 on pp. 713-721) would greatly expand the scope of these suits against third parties, while doing something entirely new: allow freelance lawyers to file them on behalf of the government "” without asking permission "” and collect rich bounties if they manage thereby to extract money from the defendants. Lawyers will recognize this as a qui tam procedure, of the sort that has led to a growing body of litigation filed by freelance bounty-hunters against universities, defense contractors and others alleged to have overcharged the government.

It gets worse. Language on p. 714 of the bill would permit the lawyers to file at least some sorts of Medicare recovery actions based on "any relevant evidence, including but not limited to relevant statistical or epidemiological evidence, or by other similarly reliable means". This reads very much as if an attempt is being made to lay the groundwork for claims against new classes of defendants who might not be proved liable in an individual case but are responsible in a "statistical" sense. The best known such controversies are over whether suppliers of products such as alcohol, calorie-laden foods, or guns should be compelled to pay compensation for society-wide patterns of illness or injury.

He has a lot more detail.  Ask anyone in a public contact business in California how similar laws for ADA violations have worked out.  Just one more horrible, failed law from California that has driven the state into the ground now being emulated at the national level.

It's Official, We're Living in France Now

From Cafe Hayek:

President Obama's modest proposal to slice $17 billion from 121 government programs quickly ran into a buzz saw of opposition on Capitol Hill yesterday, as an array of Democratic lawmakers vowed to fight White House efforts to deprive their favorite initiatives of federal funds.

Sen. Dianne Feinstein (D-Calif.) said she is "committed" to keeping a $400 million program that reimburses states for jailing illegal immigrants, a task she called "a total federal responsibility."

Rep. Mike Ross (D-Ark.) said he would oppose "any cuts" in agriculture subsidies because "farmers and farm families depend on this federal assistance."

And Rep. Maurice D. Hinchey (D-N.Y.) vowed to force the White House to accept delivery of a new presidential helicopter Obama says he doesn't need and doesn't want. The helicopter program, which cost $835 million this year, supports 800 jobs in Hinchey's district. "I do think there's a good chance we can save it," he said.

The news releases began flying as Obama unveiled the long-awaited details of his $3.4 trillion spending plan, including a list of programs he wants to trim or eliminate. Though the proposed reductions represent just one-half of 1 percent of next year's budget, the swift protest was a precursor of the battle Obama will face within his own party to control spending and rein in a budget deficit projected to exceed $1.2 trillion next year.

Trough Leader

Holman Jenkins argues that despite the fact that GM's all-electric car the Volt will likely lose money on every sale, GM knows exactly what it is doing with this program.  The main customer, apparently, is not the end consumer, but the government.  GM is betting that an Obama, beholden in his new presidency to unions and environmentalists, will be open to a massive government subsidy of the US auto industry.  The Volt program may be part of a plan to buff up GM's attractiveness at the government trough:

GM executives are not nuts. They justify the costs and
risks of the Volt as a way of changing GM's image in the minds of
consumers and politicians. To commit a pun, the Volt is GM's vehicle
for making a bailout of GM politically acceptable.

The company has already started signaling it expects
Washington to provide a whopping $7,000 tax credit to Volt purchasers.
In Europe and the U.S., under whatever fuel economy and emissions
regulations prevail, GM also expects special favoritism for the Volt.
The goal is to re-enact the flex-fuel hoax, in which GM receives extra
credit for making cars that can burn 85% ethanol, even if they never
see a drop of such fuel.

CEO Rick Wagoner last week laid out the case to Barack
Obama personally for turning GM into a ward of the state, by way of
direct and indirect subsidies to support a transition to "alternative"
fuel vehicles. GM has done yeoman's work getting its structural costs
(i.e., labor) in line, but shareholders should note that a big part of
the company's turnaround gamble consists also of eliciting favor once
again from Washington after a period in which the domestic auto makers
were nothing but whipping boys on Capitol Hill.

But We Can Run Healthcare

By now, this story has been linked all over, but it is still hilarious.  The folks who want to run the US healthcare system and the US energy industry have found that they are not competent enough to manage even the Senate cafeteria:

Year after year, decade upon decade, the U.S. Senate's network of
restaurants has lost staggering amounts of money -- more than $18
million since 1993, according to one report, and an estimated $2
million this year alone, according to another.

The financial condition of the world's most exclusive dining hall and its affiliated Capitol Hill
restaurants, cafeterias and coffee shops has become so dire that,
without a $250,000 subsidy from taxpayers, the Senate won't make
payroll next month....

In a masterful bit of understatement, Feinstein blamed "noticeably
subpar" food and service. Foot traffic bears that out. Come lunchtime,
many Senate staffers trudge across the Capitol and down into the
basement cafeteria on the House side [where food service is provided privately]. On Wednesdays, the lines can be
30 or 40 people long.

This is not a new issue - it has been a festering sore that the Senate has been unable to manage for decades.  And we're talking about a single freaking cafeteria here.  More from Alex Tabarrok

Carbon Tax vs. Cap and Trade

I don't believe man-made global warming is substantial enough or catastrophic enough in its effects to warrant expensive public action.  But if we did feel the need to do something, John Tierney echoes a theme I have been sounding for a while (emphasis added):

The CBO report concludes that a tax on carbon emissions "would be
the most efficient incentive-based option for reducing emissions and
could be relatively easy to implement. If it was coordinated among
major emitting countries, it would help minimize the cost of achieving
a global target for emissions by providing consistent incentives for
reducing emissions around the world." But the major presidential
candidates aren't supporting such a tax, and the few proposals on
Capitol Hill to impose a tax are not expected to go anywhere anytime
soon.

Instead, the candidates and most legislators prefer to talk about
cap-and-trade schemes like the Kyoto protocol. These schemes have the
great political advantage of hiding the costs from consumers and
voters, but they cost more and accomplish less.
The CBO calculates that
the net benefits of a tax would be five times higher than for a
cap-and-trade with inflexible targets. A more flexible cap-and-trade
system wouldn't be quite as bad a deal economically, but it would
create all sorts of political temptations for doling out exemptions and
subsidies to well-connected industries and companies.

Stop Right There or I Will Shoot Myself!

Via the Washington Post:

It has become a Capitol Hill ritual: A few senators, always including the New York Democrat Charles E. Schumer, introduce a bill to punish China
if its leaders do not raise the value of the nation's currency. Photos
are taken, news releases are issued, but nothing really happens.

This
year, the atmosphere on the Hill is markedly different. Powerful
senators from both sides of the aisle, Schumer among them, are pushing
two bills that threaten retaliatory action if China does not budge. For
the first time, the idea is gaining broad support. The bills are moving
swiftly through the Senate, and many analysts expect one will pass.

If the bill's authors are successful, the effect at a minimum will be to raise consumer prices in the United States and lower them for Chinese citizens.  So we are going to "punish" China by making our own citizens pay higher prices.  How does this make any sense?  Also, in the process, let's make sure we reduce the capacity of China to buy US government debt, which to this point has been reducing the cost of the Federal budget deficit.

Tyler Cowen argues this is the best we can expect -- the worst is a substantial debalization in the Chinese economy... and ours.  I wrote much more on continuing to allow the Chinese government to subsidize American consumers here.

Vote Buying?

This reminded me a bit of the Michael Keaton Batman movie, where the Joker was handing out money to voters in a bid for popular support:

The Capitol Hill newspaper writes that Democratic
House challengers "think they have found a clever way to harness voter
anger over high gasoline prices" by selling it for less, a move that
Republicans defending their seats say is "tantamount to vote buying."

Rep. Ron Lewis (R-KY) has asked the U.S. attorney in
Louisville to investigate whether his opponent, Democrat Mike Weaver,
violated criminal code with his recent "cheap gas event
at an Elizabethtown station, where motorists filled up for $1.22 a
gallon "“ the price of gasoline when Rep. Lewis took office in 1994.

Beyond the obvious question of just what the hell Ron Lewis had to do with or could have done to stop the run-up of gas prices from $1.22 to their current levels, it would be interesting if this turns out to be legal at the same time that actual political speech is illegal.

I don't know election law very well.  Clearly handing out subsidized gas below cost as part of a political rally is roughly equivalent to handing out $20 bills to anyone who attends said rally.  The party officials involved argue that this activity is legal as long as there is no way to track who got the largess or to tie the money handouts to actual voting decisions:

"The gas is available to whomever wishes to purchase it
at the subsidized sale price for a short time ... there's no condition
attached," Bauer told the newspaper, adding that there is no way to
track whether motorists purchasing the lower-priced fuel are registered
to vote in the district the candidate is running for, or whether they
will vote at all.

I don't know election law very well, so I will ask the readers.  If I was running for office, and holding a publicity event at which I handed out $20 bills to attendees, would that be a legal election practice if, as with the party's logic above, I hand them out to all comers regardless of their voter registration status or party affiliation and I don't do anything to track who they are?