Monthly Archives: August 2007

Venezuela & DC — Price Controls From The Barrel Of A Gun

I was checking in to see the latest news from Venezuela, and saw how Chavez is using the threat of nationalization to bring down steel prices:

Ternium SA, the only maker of flat- steel products in Venezuela, agreed to sell its goods at a discount in the South American country, warding off a threatened nationalization by President Hugo Chavez.

As part of the three-year agreement, Ternium’s Siderurgica del Orinoco SA unit will offer discounts ranging from 2 percent to 4 percent for certain programs and some businesses, Ternium said today in a statement. The company also agreed to transfer operations of a port on the Orinoco River to the government and invest $500 million in its Venezuelan facilities through 2012.

The deal comes three months after Chavez threatened to nationalize the unit, claiming that the company charged too much for steel while buying electricity and other resources at a discount. Luxembourg-based Ternium holds a 60 percent stake in Sidor, as the unit is known, while the government and workers at the steel mill each own 20 percent.

Now, I’m known for criticizing Chavez. And there should be no exception here. His threats of nationalization erode foreign investment, and will eventually destroy the country.

Yet I’m often criticized for focusing too much on Venezuela, and not enough here at home. So lest I be taken to task for considering the beam in Venezuela’s eye, I should bring up a mote in our own.

The District of Columbia was concerned about “excessive” drug prices… So they decided to threaten drug companies with arbitrary lawsuits based upon prices for drugs in other nations:

The controls, signed into law in October 2005, allow residents to sue a drug company if the wholesale price of a patented drug is 30 percent higher than the drug’s price in Canada, Germany, Australia or the United Kingdom.

“In the District’s judgment, patents enable pharmaceutical companies to wield too much market power, charging prices that are ‘excessive’ for patented drugs,” the panel wrote. “The Act is a clear attempt to restrain those excessive prices, in effect diminishing the reward to patentees in order to provide greater benefit to District drug consumers.”

Luckily for freedom’s sake, the law was just struck down in court. But that doesn’t make it’s biggest proponent, Council Member David Catania very happy. His comments suggest a quite different understanding of property than I might hold:

A three-judge appellate panel concluded that the D.C. Council and mayor might have had noble intentions with the pricing law but that it improperly usurps Congress’s power and interferes with the decisions it made in passing the federal patent law. That law allows drugmakers to maintain a monopoly — and a pricing advantage — for years after they patent a new drug.

“This may be a worthy undertaking on the part of the District government, but it is contrary to the goals established by Congress in the patent laws,” the judges continued. “The District has thus seen fit to change federal patent policy within its borders.”

Catania yesterday called the ruling “extreme in its scope” and said he will discuss appealing it with the D.C. attorney general.

“It implies that patents would ban any legislation that affects the ability of patent holders to charge whatever they please, which is absurd,” Catania said. “The Supreme Court has already upheld legislation that mandates price discounts to participate in Medicaid formularies. And no one has argued that states cannot enforce antitrust and other rules that limit monopoly prices of drugs indirectly — although the full logical thrust of the opinion would do just that.”

You see, to David Catania, drugs are not owned by pharmaceutical companies, and they have no right to decide what to charge. Drugs are owned by “the public”, and David Catania will set a “fair” price for those drugs.

Property rights are under assault from Caracas to DC. Those who believe property is communally owned, and who would rather give power to the government than the market to provide goods, are quick to reach for their sidearm in to force companies to bend to their will. They do this without an understanding of economics, or the incentives to produce, because the short-term incentive to gain power trumps the long-term goals of ensuring Venezuela has access to steel or that the world has access to newly-developed drugs.

I criticize Venezuela, because Chavez is a brash, unapologetic example of socialism in action. I often highlight Venezuela, because the changes we see in that country are a wonderful case study in what will happen if we allow socialism to further take hold here in the US. But the case in DC shows that we are facing the same pressures here, and never should our willingness to criticize Chavez allow us to forget that while we are using him as an example, the fight needs to be centered here at home.

Strippers For Ron Paul

It seems that Congressman Paul is drawing support from all kinds of people:

[T]he issue at hand is “Strippers for Ron Paul.” Why would the adult entertainment industry support such an obvious Christian? It is because the Christian congressman, Ron Paul, understands the proper role of government in the United States of America. Government should not dictate morality. Christians are instructed to cast stones if only free from sin. According to Biblical teaching, we are all born into sin and Ron Paul is the only candidate of the Republican Party doing both what his Constitution and Bible demands. I don’t know which he puts first, but I presume that it doesn’t matter because they aren’t incompatible.

Free will and free persons. Ron Paul will not likely be giving personal support to strippers, in dollars or encouragement, but he supports, in legislation, their right to be free. For that, this mother, wife, small biz owner, inventor, Libertarian Party county chairman, and ex-stripper thanks him.

As they say, politics makes for strange bedfellows.

H/T: Hit & Run

It’s Time To Write Off Mike Huckabee

His apparent support for the FairTax notwithstanding, I’ve pretty much decided that Mike Huckabee isn’t worthy of my support.

The reason ?

The fact that one of his biggest supporters is champion of the Bridge to Nowhere, and worthy of the title King of Pork:

Little Rock, AR – Former Governor Mike Huckabee announced Friday that U.S. Representative Don Young (R-AK) will serve as congressional chairman of his presidential exploratory committee and U.S. Representative John Boozman (R-AR) will serve as co-chairman.

“It’s an honor to have the strong support of such dedicated and well respected members of the U.S. Congress,” said Huckabee.

“As Governor of Arkansas and NGA Chairman, I worked closely with Don on a range of critical issues, including transportation – which is a passion we both share.  I’ve seen him in action and respect his commitment – not only to the people of Alaska, but to our country.  I have deep respect for the job he has done in Congress, and I know he’ll do a great job as chairman of my congressional team.”

I’ve written before about Congressman Young, here and here. He’s skilled at getting as much of your/my money for his constituents as possible, even if if means investing in a complete boondoggle of a transportation project, or asserting that cutting back on pork barrel spending is taking away “his money.”

I’ll give this much credit to Congressman Young. He’s a guy who knows how the system works. But, given the fact that the system itself is inherently corrupt, that can only lead to the conclusion that he’s dedicated to the idea of grabbing as much taxpayer money for his constituents as he can, regardless of whether its Constitutional, or even moral.

The fact that Huckabee would take this guy on as a supporter.

Well, you can draw your own conclusions.

The Iraq War Coalition Continues To Crumble

This time, though, we’re not talking about the international coalition of nations supporting the United States’ polices in Iraq, we’re talking about the coalition in the United States Senate, and, more specifically, one very influential Senator:

Sen. John W. Warner, one of the most influential Republican voices in Congress on national security, called on President Bush yesterday to begin withdrawing U.S. troops from Iraq in time for Christmas as a new intelligence report concluded that political leaders in Baghdad are “unable to govern effectively.”

Warner’s declaration — after the Virginia senator’s recent four-day trip to the Middle East — roiled the political environment ahead of a much-anticipated progress report to be delivered Sept. 11 by Gen. David H. Petraeus, the commanding general in Iraq. Although Warner had already broken with Bush’s strategy, this was the first time he endorsed pulling troops out by a specific date.

Warner’s comments followed the release of a new National Intelligence Estimate that provided a mixed assessment on Iraq seven months after Bush ordered more U.S. troops to the country. The report, produced by the CIA and 15 other intelligence agencies, determined that “there have been measurable but uneven improvements in Iraq’s security.” But it predicted the Iraqi government “will become more precarious” in the next six to 12 months with little hope of reaching accommodation among political factions.


At his Capitol Hill news conference, Warner, a former Navy secretary and Armed Services Committee chairman, threw Bush’s own words back at him by noting that the president has said the U.S. commitment in Iraq must not be “open-ended.” Warner said it was time for the president to come up with an “orderly and carefully planned withdrawal,” suggesting that Bush “send a sharp and clear message” to the Iraqis by announcing a pullout plan by Sept. 15 — one that would involve at least a symbolic fraction of the 160,000 troops coming home by the holidays.

“I can think of no clearer form of that than if the president were to announce on the 15th that in consultation with our senior military commanders, he’s decided to initiate the first step in a withdrawal of armed forces,” Warner said. “I say to the president respectfully, ‘Pick whatever number you wish.’ . . . Say, 5,000, could begin to redeploy and be home to their families and loved ones no later than Christmas of this year. That’s the first step.”

This isn’t some wishy-washy Republican we’re talking about here. Warner is a former Secretary of the Navy and Chairman of the Senate Armed Services Committee. On issues of national security, he’s generally considered pro-military, and, on issues of foreign policy, very conservative.

Losing the support of a man like John Warner is a sign that the Bush Administration’s plans in Iraq are not going well at all.

Jimmy Justice: Policing the Police

As a general rule, I believe that most police officers are brave, respectable, and truly do their best to honor their mission statement: to serve and protect. As with any organization, there are some bad apples, however. And what happens when a police officer abuses his or her badge to break the law or harass a citizen? If it goes to court and it’s the citizen’s word against the police officer’s, unfortunately, many judges and juries will give the police officer the benefit of the doubt.

As Doug has pointed out in several of his posts, cities are considering adding surveillance cameras on city streets to keep an eye on the citizens. One man who calls himself Jimmy Justice is turning the tables and is doing some surveillance of his own on police officers and government officials who abuse the power given to them by the public.

As you might expect, some of these government officials don’t appreciate their bad behavior filmed and later broadcast on the internet for the whole world to see. Jimmy Justice’s work has put public pressure on the respective government agencies to investigate these incidents further and take disciplinary action.

In a time where government is taking more and more control over our lives, its refreshing to see that everyday citizens have the will and the technology to serve as a check on government abuse of power. This first clip is a news story on Jimmy Justice and his mission to police the police.

This second video is Jimmy Justice confronting a police officer who parked in front of a fire hydrant (if an average citizen were to do the same thing he or she would be ticketed and fined). Notice the contempt this woman and her friend have for the citizens; it’s both disturbing and revealing.


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