Ewan Watt writes about the recent decision of CVS to stop selling cigarettes, and how there is more than meets the eye.
Whether this has been prompted by government isn’t entirely clear, but with the lucrative Affordable Care Act and the carefully coordinated social media campaign with the White House, it certainly has some of the hallmarks of ‘Blue Eagle’-style corporatism. At least the skeptics among us won’t be too surprised if government rules or Congress legislates that any pharmacy receiving government funds via Medicare or Medicaid can no longer sell products they deem unwholesome.
But the real concern here stems from the fact that CVS is taking this ‘voluntary’ move because they’re simply replacing these lost revenues with fruits emanating from their hard fought battles to increase the size of government. Consumers lose choice; CVS will be compensated by their taxes. From the initial discussions around the Affordable Care Act to its eventual passage and botched implementation, CVS’s lobbying team has been omnipresent — and increasingly aggressive. In fact the company more than doubled its lobbying expenditures in the third quarter of 2013 to nearly $5 million. Such massive investment isn’t made to create a free market and enhance consumer choice. It’s to ensure that government — not competition — is augmenting your bottom line.
No, it’s not deja vu, it’s simply another professional sports franchise asking for taxpayer money to help fund its private operations. In this Sun-Sentinel report, it’s revealed that the team hasn’t delivered on almost all of its original promises to the taxpayers, and now they’re asking for even more money:
The Florida Panthers professional hockey team says it’s losing more than $20 million a year and needs more public funds to survive.
In August we noted that a new federal regulation would slow the revolving door between the SEC and the private sector. Well, the Office of Government Ethics is withdrawing the rule before it can take effect (a seemingly unusual event). The Project On Government Oversight reports:
A notice published in Monday’s edition of the Federal Register said that the Office of Government Ethics (OGE) was withdrawing the new rule at “the request of the SEC” so that the agency could have more time to “effectively educate affected employees before the exemption revocation takes effect.”
That being said, OGE is planning to republish the rule in January, for an effective delay of about 90 days.
The ethics office said it expects to republish the rule in January 2014, but it then would take another 90 days for the rule to go into effect, according to Monday’s announcement. As a result, SEC employees who would be affected by the rule change—including supervisory accountants, attorneys, economists, analysts, and administrative specialists—will have even more time to take advantage of the loophole.
The National Legal and Policy Center describes how one company is benefiting from the government ban on incandescent light bulbs… and how politicians are benefiting from the company.
Besides the federal and state governments’ coercive tactics in shaping citizens’ lighting practices, it shouldn’t surprise that Cree also is heavily invested in the same behavior that much of the rest of the “green” energy industry depends on: crony capitalism. In March 2010 Vice President Joe Biden, as he toured companies that had secured stimulus grants and loans, visited Cree along with then-Energy Secretary Steven Chu. Cree had received a $39-million tax credit through the Recovery Act, as well as $1.8 million in stimulus money for research and development. This coincided nicely with a visit by Swoboda to the White House the previous July, as well as a timely 2009 increase in Cree’s lobbying expenditures of 137 percent over the previous year.
The entire piece is an engrossing read, and portends a dark future for the light bulb.
According to a report by The Washington Post, nearly 38 percent of workers require some form of license or certification to do their job. This number represents a staggering growth of licensing when compared to the 5 percent of workers who needed a license in the 1950’s and even the 18 percent of workers in the 1980’s. Licensing benefits those already in the profession, which is why they often lobby for it.
“[The growth] tends to come from the occupations themselves,” he said. “They organize, they pay somebody to be the head of an organization, they lobby the legislature.”
Can federal drug reimbursement rates be affected by special interests? Tad Dehaven at the Cato Institute makes the case that they can be.
Thanks to a massive lobbying campaign from the dialysis industry ($8 million since 2009), Congress is now considering giving back the taxpayer-financed windfall. According to theTimes, “more than 100 of the same members of Congress who voted in January to impose the cut are now trying to push the Obama administration to reverse it or water it down.”
The Federal Reserve posses arbitrary control over every type of financial institution, and it’s tasked with impossible goals such as stopping bubbles, speculative excesses, and overheated markets. John Cochrane warns that when these powers are exercised it could make the Fed a focus of lobbying, political pressure, and cronyism. From the Wall Street Journal (may be gated):
[When the Fed regulates companies and sectors] Will not all of these people call their lobbyists, congressmen and administration contacts, and demand change? Will not people who profit from Fed interventions do the same? Willy-nilly financial dirigisme will inevitably lead to politicization, cronyism, a sclerotic, uncompetitive financial system and political oversight.
Navigating the Affordable Care Act has become so important that a number of folks who helped create it have been hired as lobbyists or consultants. From The Hill:
ObamaCare has become big business for an elite network of Washington lobbyists and consultants who helped shape the law from the inside.
More than 30 former administration officials, lawmakers and congressional staffers who worked on the healthcare law have set up shop on K Street since 2010.
The Export-Import Bank may provide a loan guarantee for the purchase of eleven Gulfstream aircraft by Russian billionaire Gennady Timchenko. From Reuters:
Billionaire Russian businessman Gennady Timchenko, a long-time associate of Russian President Vladimir Putin, plans to seek U.S. government-backed funding to buy luxury aircraft, Reuters has learned.
To smooth the path for financial backing from the U.S. Export-Import Bank and allay possible U.S. government concerns about him, Timchenko hired lobbyists from powerhouse Washington law firm Patton Boggs, according to emails and documents viewed by Reuters.
Robert Lenzner a Forbes Staff wrote the following article, in which Mr. Lenzner asks Tim Geithner some direct questions regarding crony capitalism, too-big-to-fail banks and Geithner’s relationship with investment banks.
My grudge about Geithner goes back to a brief scene in the Oscar-winning documentary, “Inside Job,” where he exclaims that he has never had experience as a regulator.
I have another query for Geithner. Why did you eject the tough and bold suggestion from your staff that the senior executives of Merrill Lynch and AIG and others, who received their hefty cash bonuses despite needing federal funds to bail them out, not face a special tax that required them to pay much of their ill-gotten gains back to Uncle Sam? Yes, such a move would have taken guts in playing hard ball with your cronies.