Economics and Social Policy – XXXVIII

Welcome to the November 19, 2007 edition of Economics and Social Policy.

Steve Bainbridge presents The Complete Guide to SOX: An Excerpt posted at Professor Bainbridge's Business Associations Blog. Prof. Bainbridge is pimpin’ his book. Fine by me; understanding SOX issues is critical for those in senior management or directors at public firms. The primary effects of SOX – allowing Congress to take credit for “doing something”, enriching consultants and auditors, eroding American competitiveness in capital markets, and serving as a barrier to public finance for small firms – have been pretty well established. As P.J. O’Rourke once noted, “the law of unintended consequences is the one Congress always passes”. In terms of sheer destructiveness, SOX will probably do more damage than the AMT and Estate taxes combined. By an order of magnitude. As Mr. Blumer would say, “London and Hong Kong love SOX”.

Dax Desai presents Why $100 Oil Maybe a Good Thing posted at Dax Desai. Well, $100 Oil will certainly lead to exploration of other resources. Assuming that Environmentalists don’t stand in the way – sometimes it appears as though the real issue here is keeping the great unwashed from cheap energy, rather than a concern for the environment. Frankly, if Big Oil had an effective lobby in this country, we’d be building new refineries and drilling in the ANWR. Or if those interested in renewable power did, we’d be building more nuclear power plants.

Adam Gurri presents Beware the Death Howl of the Old Media posted at Sophistpundit. Mr. Gurri has an interesting take. However, if the UN gets it’s hands on the internet, expect the governing panels to be composed of China, Russia, Zimbabwe, Cuba, and Venezuela. Are those the folks you want governing free speech on the net? And that’s just assuming for sake of argument that the Iranians and Saudis don’t get there first.

Numerian presents As Wall Street Awaits its Destruction posted at The Agonist. Interesting, but I’m not sure that I buy the combination of yin/yang & Hinduism. Still, not something you see everyday. Unfortunately, the subprime mess will likely lead to both staggering losses, staggering taxpayer bailouts, huge bonus payments to those responsible, grandstanding by state’s attorneys general, and yet more SOX type legislation to further damage the economy.

Dr Martin W. Russell presents Why Help Yourself? posted at Dr Martin W. Russell. The standard American answer – or at least it used to be the standard – is because it’s wrong to expect anyone else to. Unfortunately, all of us now demand that others pay for our own financial incontinence.

Steven Silvers presents Rockies ticket sales fiasco a case study in bad news. posted at Scatterbox at stevensilvers.com. Possibly not Dan O’Dowds finest moment.

Ian Welsh presents The Risks of "Spreading the Risk" posted at The Agonist, and Externalities, Taxation and Subsidies

On spreading the risk - Hey baby, owe the bank a hundred bucks, and they own you. Owe the bank a hundred million bucks, and you own them. On “externalities” why believe that a bunch of self-interested bureaucrats can actually figure out the externalities and tax appropriately?

Because they can’t. And if they could, given the likely incentive structures, they likely wouldn’t. Government employees first responsibility is to protect their budget allocation. The second is to increase that allocation. The remaining priorities are to repeat #1 and #2. Any actual good that comes from this is an externality.

Tiffany Washko presents Action Alert: Vaccinate Your Kids or Else! posted at Natural Family Living Blog. I’m not nearly as anti-vaccine as Ms. Washko. However, the heavy-handedness in Maryland is just another good reason to consider homeschooling.

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