Nothing Good Can Come From FDA’s Proposed Ban of Menthol Cigarettes

By Jeffrey A. Singer of Cato.

"Food and Drug Administration Commissioner Robert M. Califf announced today that the agency plans to seek a ban on menthol cigarettes and cigars.

This ironically comes in the wake of recent research that shows menthol smokers have no greater difficulty giving up smoking than non‐​menthol smokers. Even more ironic is the fact that FDA researchers reported in the journal Nicotine and Tobacco Research:

We found evidence of lower lung cancer mortality risk among menthol smokers compared with non‐​menthol smokers among smokers at ages 50 and over in the U.S. population

And a prospective cohort study involving more than 85,000 participants in 12 southern states, reported in the Journal of the National Cancer Institute in 2011 concluded:

The findings suggest that menthol cigarettes are no more, and perhaps less, harmful than nonmenthol cigarettes.

The Centers for Disease Control and Prevention report that 60 percent of teen smokers choose non‐​menthol cigarettes. And teen smoking in general has dropped to an all‐​time low of 1.5 percent of teens—only 1 in 250 teens are daily smokers. Teen smoking has practically disappeared.

A recent study by the Reason Foundation found states with the highest menthol consumption had the lowest youth smoking rates. Furthermore, menthol smokers tend to smoke fewer cigarettes per day than non‐​menthol smokers.

Countries that have banned menthol cigarettes have generally found smokers have either switched to non‐​menthol cigarettes, come up with ways to add menthol to their cigarettes, or purchased menthol cigarettes on the black market.

Because menthol cigarettes are much more popular among Black and Brown smokers than white smokers, banning menthol cigarettes runs counter to efforts to reduce health disparities. But even worse, as I wrote last year, prohibition of menthol cigarettes is likely to worsen inequities in criminal justice. The last thing this country needs is yet another reason for law enforcement to engage with minorities they suspect are committing the victimless crime of selling menthol cigarettes in the black market.

A ban of menthol cigarettes and cigars will only lead to negative, even if unintended, consequences."

A Bad Day for Incandescent Light Bulbs – and Freedom of Choice

By Ben Lieberman of CEI.

"Consumers are better off with choices, and worse off when federal regulators step in and take them away. That’s the best way to view today’s Department of Energy (DOE) Final Rule that will likely spell the end of the road for incandescent light bulbs.

DOE asserts that it is required by law to create a 45-lumens-per-watt (LPW) minimum efficiency level for all light bulbs, which incandescent bulbs cannot meet without prohibitively expensive modifications. But as CEI and 14 other free market organizations argued in our comments to the agency last January, the applicable statutory provisions do not compel the agency to do so. We also argued that the 45 LPW standard would violate the consumer protections in the law that forbid the agency from setting efficiency standards that have the effect of reducing available choices.

The only good news is that light-emitting diode (LED) bulbs that can meet the new 45 LPW standard are very good and continue to improve. They are also coming down in price but still cost more than incandescent bulbs and are inferior for certain functions such as dimming. Overall, consumers are better off if they can choose between incandescent bulbs and LEDs rather than regulating LEDs into the only game in town. Ironically, DOE asserts that growing market share of LEDs supports its rule, but in truth it shows that the market is working on its own and that government interference is unnecessary.

Also problematic is DOE’s projections of the rule’s climate benefits. In effect, the agency calculates the tons of reduced greenhouse gas emissions attributable to more efficient light bulbs (the result of marginally less electricity generated) and then multiplies it by the estimated damage done by each ton of such emissions to come up with a midrange estimate of $591 million in annual climate benefits. Our comment pointed out that such calculations of the social cost of greenhouse gas emissions are highly speculative and subject to bias, especially in the hands of an agency like DOE with a regulatory agenda. We also noted that it and other environmental considerations have a limited role in setting appliance efficiency standards, the statutory focus of which is the direct benefits to consumers. Nonetheless, the Final Rule is a sign that DOE sees these efficiency regulations as climate policy tools and that inflated climate considerations are likely to become a prominent feature in subsequent rulemakings."

What Sweden Got Right About COVID

The U.S. botched the pandemic—overprotecting kids at low risk of serious illness and under-protecting older Americans. Stockholm pursued a light touch and fared far better. 

By Shannon Brownlee and Jeanne Lenzer. Shannon Brownlee is a lecturer at George Washington University School of Public Health. Jeanne Lenzer is the author of The Danger Within Us; America's Untested, Unregulated Medical Device Industry and One Man's Battle to Survive It.

"Talk about killjoys. While the rest of us are enjoying what’s starting to feel like a return to everyday life, some experts are warning that there’s another COVID-19 variant coming. Philadelphia has reinstituted its mask mandate. The wave of new infections in Europe will hit us soon, they say, and failing to maintain at least some of the lockdowns we’ve endured for the last two years is “denialism.” That message is echoed by the People’s CDC, a group of epidemiologists, doctors, and other people with long COVID. They argue that the federal Centers for Disease Control and Prevention’s recommendation to focus on protecting those at the highest risk and a return to “normal” for everybody else is precisely the wrong course of action. 

But is it? 

While most countries imposed draconian restrictions, there was an exception: Sweden. Early in the pandemic, Swedish schools and offices closed briefly but then reopened. Restaurants never closed. Businesses stayed open. Kids under 16 went to school. 

That stood in contrast to the U.S. By April 2020, the CDC and the National Institutes of Health recommended far-reaching lockdowns that threw millions of Americans out of work. A kind of groupthink set in. In print and on social media, colleagues attacked experts who advocated a less draconian approach. Some received obscene emails and death threats. Within the scientific community, opposition to the dominant narrative was castigated and censored, cutting off what should have been vigorous debate and analysis.

In this intolerant atmosphere, Sweden’s “light touch,” as it is often referred to by scientists and policy makers, was deemed a disaster. “Sweden Has Become the World’s Cautionary Tale,” carped The New York Times. Reuters reported, “Sweden’s COVID Infections Among Highest in Europe, With ‘No Sign Of Decrease.’” Medical journals published equally damning reports of Sweden’s folly. 

Stockholm Solution

But Sweden seems to have been right. Countries that took the severe route to stem the virus might want to look at the evidence found in a little-known 2021 report by the Kaiser Family Foundation. The researchers found that among 11 wealthy peer nations, Sweden was the only one with no excess mortality among individuals under 75. None, zero, zip. 

That’s not to say that Sweden had no deaths from COVID. It did. But it appears to have avoided the collateral damage that lockdowns wreaked in other countries. The Kaiser study wisely looked at excess mortality, rather than the more commonly used metric of COVID deaths. This means that researchers examined mortality rates from all causes of death in the 11 countries before the pandemic and compared those rates to mortality from all causes during the pandemic. If a country averaged 1 million deaths per year before the pandemic but had 1.3 million deaths in 2020, excess mortality would be 30 percent.

There are several reasons to use excess mortality rather than COVID deaths to compare countries. The rate of COVID deaths ignores regional and national differences. For example, the desperately poor Central African Republic has a very low rate of fatalities from COVID. But that’s because it has an average life expectancy of 53. People in their 70s are3,000-fold more susceptible than children to dying of COVID, and even people in their 20s to 50s are far less likely to die than the elderly. So, it’s no surprise that the Central African Republic has a low COVID mortality rate despite its poverty and poor medical care. The U.S., by contrast, with its large elderly population (and general ill-health compared to most wealthy countries), was fertile soil for the coronavirus. 

Excess mortality is the smart, objective standard. It includes all deaths, whether from COVID, the indirect effects of COVID (such as people avoiding the hospital during a heart attack), or the side effects of lockdowns. And it gets rid of the problem of underlying differences among countries, allowing a direct comparison of their performance during COVID.

Using data from the Human Mortality Database, a joint project of the CDC and the Max Planck Institute in Germany, Kaiser compared mortality during the five years before the pandemic and mortality in 2020, the first year of the pandemic. Sweden had zero excess mortality in 2020 among people younger than 75. In other words, COVID wasn’t all that dangerous to young people. 

Even among the elderly, Sweden’s excess mortality in 2020 was lower than that in the U.S., Belgium, Switzerland, the U.K., the Netherlands, Austria, and France. Canada, Germany, and Australia had lower rates than Sweden among people over the age of 70—probably because Sweden failed to limit nursing home visits at the very beginning of the pandemic. 

The U.S., by contrast, had the highest excess mortality rate among all 11 countries in the Kaiser study. We also had a stunning number of COVID deaths—more than 1 million. Our lousy rate is probably due to multiple factors, says Jay Bhattacharya, a professor of medicine at Stanford University and senior fellow at the Stanford Institute for Economic Policy Research. Our underlying health is worse than most wealthy countries because of our wide wealth gap, high rates of poverty and obesity, spotty access to high-quality health care for the poor, and an aging population. 

The Kaiser results might seem surprising, but other data have confirmed them. As of February, Our World in Data, a database maintained by the University of Oxford, shows that Sweden continues to have low excess mortality, now slightly lower than Germany, which had strict lockdowns. Another study found no increased mortality in Sweden in those under 70. Most recently, a Swedish commission evaluating the country’s pandemic response determined that although it was slow to protect the elderly and others at heightened risk from COVID in the initial stages, its laissez-faire approach was broadly correct. 

This brings us to the other insight from Kaiser researchers. By looking only at 2020, before the advent of vaccines and other medical treatments, the researchers could measure the effect of lockdowns. While those who could retreat to home computers may have viewed restrictions as simply annoying disruptions, for many Americans they were devastating, as reflected in our high excess mortality rate. 

One of the most pernicious effects of lockdowns was the loss of social support, which contributed to a dramatic rise in deaths related to alcohol and drug abuse. According to a recent report in the medical journal JAMA, even before the pandemic such “deaths of despair” were already high and rising rapidly in the U.S., but not in other industrialized countries. Lockdowns sent those numbers soaring.

The U.S. response to COVID was the worst of both worlds. Shutting down businesses and closing everything from gyms to nightclubs shielded younger Americans at low risk of COVID but did little to protect the vulnerable. School closures meant chaos for kids and stymied their learning and social development. These effects are widely considered so devastating that they will linger for years to come. While the U.S. was shutting down schools to protect kids, Swedish children were safe even with school doors wide open. According to a 2021 research letter, there wasn’t a single COVID death among Swedish children, despite schools remaining open for children under 16.

Of the potential years of life lost in the U.S., 30 percent were among Blacks and another 31 percent were among Hispanics; both rates are far higher than the demographics’ share of the population. Lockdowns were especially hard on young workers and their families. According to the Kaiser report, among those who died in 2020, people lost an average of 14 years of life in the U.S. versus eight years lost in peer countries. In other words, the young were more likely to die in the U.S. than in other countries, and many of those deaths were likely due to lockdowns rather than COVID. 

Looking to the Future

Lockdowns may not come back when the next COVID surge hits, but many public health officials say masks likely will be. Even that may not be worth the effort, at least for kids in schools. Despite headlines claiming that they work, the only two decent scientific studies of masks found minimal benefit against COVID. 

The more extensive study of the two, published last September, was used as ammunition to support school mask mandates—even though children had been excluded from the study. The study found that masks failed to prevent 90 percent of infections; only the elderly benefited modestly. Ashley Styczynski, one of the principal investigators, said “further study” was needed to know if masks provide any protection to kids.

Last month, the Senate Committee on Health, Education, Labor and Pensions voted overwhelmingly to establish an independent panel to investigate the nation’s response to the pandemic, modeled on the much-heralded 9/11 Commission. Such a COVID commission should study Sweden, even if the American medical and public health establishment continues to scoff at this Scandinavian success. Whether it was Sweden’s light touch or America’s lockdowns, no public health response could have prevented COVID deaths entirely. But the data shows that Sweden did better and suggests we’d be better off with their light touch when the next coronavirus crisis comes ashore."

New evidence on schooling and pandemic learning

From Tyler Cowen.

"We estimate the impact of district-level schooling mode (in-person versus hybrid or virtual learning) in the 2020-21 school year on students’ pass rates on standardized tests in Grades 3–8 across 11 states. Pass rates declined from 2019 to 2021: an average decline of 12.8 percentage points in math and 6.8 in English language arts (ELA). Focusing on within-state, within commuting zone variation in schooling mode, we estimate districts with full in-person learning had significantly smaller declines in pass rates (13.4 p.p. in math, 8.3 p.p. in ELA). The value to in-person learning was larger for districts with larger populations of Black students.

That is from a new paper by Rebecca Jack, Claie Halloran, James Okun, and Emily Oster."

 

Compared to young women, young men were less likely to graduate from high school, more likely to drop out of high school, less likely to enroll in college after high school, and more likely to be unemployed

See Chart of the day: For every 100 young women in October 2021 by Mark Perry. Excerpt:

"Yesterday the Bureau of Labor Statistics released its annual report on “College Enrollment and Work Activity of Recent High School and College Graduates – 2021” based on data as of October 2021. Here’s a description of the BLS data used for the report:

The estimates in this release were obtained from a supplement to the October Current Population Survey (CPS), a monthly survey of about 60,000 eligible households that provides information on the labor force, employment, and unemployment for the nation. The CPS is conducted monthly for the Bureau of Labor Statistics by the U.S. Census
Bureau. Data in this release relate to the school enrollment status of persons in the civilian noninstitutional population in the calendar week
that includes the 12th of October. Data about recent high school graduates and dropouts and the enrollment status of youth refer to persons 16 to 24 years of age. Data about recent associate degree recipients and college graduates refer to persons 20 to 29 years of age.

The data in the BLS report are presented in three tables that correspond to the three sections in the chart above:

• Table 1. Labor force status of 2021 high school graduates and 2020-2021 high school dropouts 16 to 24 years old by school enrollment, educational attainment, sex, and rate in October 2021
• Table 2. Labor force status of persons 16 to 24 years old by school enrollment, educational attainment, sex, and race in October 2021
• Table 3. Labor force status of 2021 associate degree recipients and college graduates 20 to 29 years old by selected characteristics in October 2021

Although the BLS report highlighted several gender differences in educational and labor force outcomes between young men and young women, most of the 23 gender differences displayed in the chart above were not mentioned in the text of the BLS report. Specifically, the data in the chart above show that:

• Compared to young women, young men were less likely to graduate from high school, more likely to drop out of high school, less likely to enroll in college after high school, and more likely to be unemployed. For example, for every 100 young women who graduated from high school in 2021 and did not enroll in college in the fall, there were 166 young men. For every 100 young women who were recently dropped out of high school, there were 133 young men. For every 100 young women who were recent high school dropouts and unemployed, there were 238 young men.
• Compared to women ages 16 to 24, men in that age group were less likely to be enrolled in college, far less likely to have earned a bachelor’s degree or higher, and far less likely to be employed with a college degree. Compared to young women in that age group, young men were far more likely to have less than a high school diploma, much less likely to attend college after high school, and more likely to be unemployed with or without a high school diploma. For example, for every 100 young women ages 16-24 who were enrolled in college and working last fall, there were only 69 young men.
• Compared to females ages 20-29 years old who recently earned an associate’s degree or hold a bachelor’s or advanced degree (master’s, professional or doctoral), their male counterparts were far less likely to have recently earned an associate’s degree, less likely to hold a bachelor’s or advanced (master’s, professional or doctoral) college degree and far less likely to have a college degree (bachelor’s degree or higher) and be employed. Young men ages 20-29 who were recent associate degree recipients, recent college graduates with a bachelor’s degree or higher, and those with a bachelor’s or advanced degree were far more likely to have those degrees and be unemployed than their female counterparts. For example, for every 100 women who were recent associate degree recipients, there were only 67 men. For every 100 women with an advanced degree (master’s, professional or doctoral) and working, there were only 30 men. For every 100 women who were recent college graduates with a bachelor’s degree and working there were only 55 men. For every 100 women who were recent college graduates with a bachelor’s degree or higher and not working, there were 249 unemployed men in that cohort.

The significant gender differences favoring young women for a variety of educational outcomes detailed above provide additional empirical evidence that it is men who are increasingly struggling to finish high school and attend and graduate from college. Actually, men have been increasingly underrepresented and “marginalized” in higher education for 40 years going back to the early 1980s. And young women are more likely than their male counterparts to be working after earning a college degree. College-educated young men with any degree (associate’s, bachelor’s, or advanced) are more likely than female college graduates to be either unemployed or not in the labor force.

It is young men, more than young women, who are at-risk and facing serious educational and work-related challenges, which show up later in large gender disparities for a variety of measures of (a) behavioral and mental health outcomes, (b) alcoholism, drug addiction, and drug overdoses, (c) suicide, murder, violent crimes, and incarceration, and (d) homelessness."

Some Pandemic Unemployment Fraud Was Inside Job

By Craig Eyermann of the Independent Institute.

"Getting pandemic unemployment benefits was easy money in 2020. Lockdowns by state and local governments shut down thousands of businesses, throwing millions out of work. Uncle Sam rode to their rescue with billions in unemployment benefits, doled out through state unemployment offices.

That flood of aid triggered “the biggest fraud in a generation.” In New York, part of that fraud has proven to be an inside job, pulled off by two bureaucrats in the state’s labor department. The Albany Times-Union’s Brendan Lyons explains:

Two state Department of Labor workers allegedly conducted a massive identity fraud scheme to steal more than $1.6 million in unemployment benefits during the pandemic using co-conspirators they enlisted through an ad on Craigslist as well as “friends and acquaintances,” according to federal court records.

The pair, Wendell C. Giles, 51, a former Buffalo resident living in Albany, and 33-year-old Carl J. DiVeglia III of Albany were snared as part of investigation by the FBI and the U.S. Department of Labor. Both have been terminated from their jobs, according to state comptroller’s records.

It is good news that both DiVeglia and Giles were terminated from their state government jobs. That’s not often the case when bureaucrats get caught behaving badly. It is better news that DiVeglia pled guilty to charges of mail fraud and identity theft in federal court on April 13, 2022. Giles was arrested on charges for his role on April 22, 2022.

How the Fraud Was Made

Lyons’ report describes how DiVeglia and Giles’ pulled off their scheme to get rich at U.S. taxpayer expense:

According to DiVeglia’s plea agreement, he and Giles had work duties that included “processing unemployment insurance claims and distributing state and federal unemployment insurance benefits to eligible New Yorkers.” That work gave them access to the department’s computer systems, which they used to enter the fraudulent claims and to instruct the systems to release the benefits.

The plea agreement also said that DiVeglia “used other people’s identifying information, including names, dates of birth, and Social Security numbers, to fraudulently create and approve unemployment insurance applications.” Sometimes he would make up the information in required fields in the applications—which include information such as the maiden name of an applicant’s mother or their work history.

In many instances, the pair would make agreements with the individuals whose identities were used to file the fraudulent applications to share the payouts, which often were in the tens of thousands of dollars.

The payments were issued through debit cards in the name of banking institutions, including KeyBank, and mailed to the addresses in the unemployment applications. DiVeglia used his computer access to release partial payments “to secure his share of the fraud proceeds before releasing the remainder of the funds due on the claims.”

Overall, New York dished out $68.3 million of pandemic unemployment benefits to people who weren’t eligible for them. That larger fraud was enabled by other bureaucrats, who disabled the state’s anti-fraud safeguards to dish out the welfare payments faster."

‘Tangled Web’ of Laws, Regulations Stifles Carbon Capture Push

By Dean Scott of Bloomberg.

"President Joe Biden faces significant hurdles in his effort to reach net-zero emissions by 2050, including a daunting maze of environmental concerns and permitting requirements that stand in the way of thousands of carbon capture projects that may be needed to help reach that goal.

The administration estimates more than 1,000 carbon capture operations may be needed to trap as much as 1.7 billion tons of carbon dioxide emissions per year. It would be an ambitious undertaking, requiring a ten-fold increase in current projects over the next decade.

Power plants and big-emitting industries like steel and cement also face challenges to make carbon capture—a decades-old process that has traditionally been limited to oil recovery—cost-effective. They’d also need big technological leaps to divert significant emissions into permanent underground reservoirs and other geological formations.

Congress has chipped away at some permitting hurdles and expanded tax credits, pilot projects, and research dollars for permanent storage of carbon dioxide, the most prevalent greenhouse gas. But without comprehensive climate legislation or carbon tax plans on the horizon, the wave of carbon capture projects seen as vital in combating climate change could amount to little more than a trickle.

And there’s still nothing on the horizon to distill federal requirements spanning some 15 laws into a cohesive regulatory roadmap to speed carbon capture deployment, said Matt Fry, the Great Plains Institute’s state and regional policy manager for carbon management.

“The reality is, no matter what the project is, you have to meet the criteria of all those laws,” Fry said. “It is a tangled web.”

Virtually every pathway to global net-zero emissions considered by the United Nations Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency includes significant carbon capture deployment.

NEPA Needed

Despite supporting carbon capture, Biden hasn’t embraced significant streamlining of the 50-year-old National Environmental Policy Act, which empowers environmental groups to challenge environmental assessments in court. NEPA remains “the overriding environmental statute” posing an obstacle to wide-scale carbon capture deployment, said Hunter Johnston, a partner with Steptoe & Johnston LLP who navigates requirements for carbon capture projects.

Much-anticipated Council on Environmental Quality guidance released in February was skimpy on regulatory changes Biden might support but also less than a full-on embrace of the technology, Johnston said.

The interim guidance said “successful widespread” carbon capture deployment will require “efficient regulatory regimes” and meaningful public engagement.

It echoed CEQ’s June 2021 report, which said the U.S. “has an an existing regulatory framework capable of safeguarding the environment, public health and public safety,” said Sarah Forbes, CEQ’s Director of Carbon Capture Utilization and Sequestration. The proposed guidance will be finalized after CEQ reviews nearly 50 comments it received from unions, industry, and environmental groups.

And while carbon capture tax incentives were crucial to launching many U.S. projects in the pipeline, “incentives alone are not enough for successful and responsible technological deployment, which also requires standards that provide regulatory certainty,” the report said.

Environmental Justice Tensions

The Biden administration also faces resistance from environmental justice advocates who fear carbon capture projects will add to burdens on disadvantaged communities.

Biden should have addressed those issues head-on in the guidance, Johnston said, by making the case “that carbon capture and sequestration is beneficial to society at large” for all, including disadvantaged communities that already suffer disproportionately from climate impacts.

The technology remain “unproven” for large-scale emissions storage, said Anthony Rogers-Wright, environmental justice director for the New York Lawyers for the Public Interest. It’s the newest “epoch of environmental racism,” he said, which will slow the transition from fossil fuel power plants to clean energy and saddle disadvantaged communities with pipelines and other infrastructure.

But navigating U.S. regulations can be daunting, particularly for projects getting federal funds or crossing federal lands, which can trigger requirements under as many as 15 federal statutes, including the Clean Air Act, Safe Drinking Water Act, and Endangered Species Act. Getting bipartisan agreement to streamline those requirements isn’t likely anytime soon, said Sen. John Barrasso (R-Wyo.), who has worked to shepherd legislation chipping away at some regulatory hurdles.

Barrasso’s USE IT Act, signed by President Donald Trump in 2020, included narrow Clean Air Act tweaks to push EPA to support technologies pulling carbon dioxide from ambient air, and made some carbon capture infrastructure, such as pipelines, eligible for streamlined permitting.

But Biden’s guidance failed to “put forth any real solutions,” Barrasso said in an e-mailed statement. If CEQ fails “to provide a reasonable roadmap” for faster deployment, “I believe Congress should look at additional opportunities to streamline permitting and speed up deployment of this critical technology.”

Outdated Requirements

The current regulatory framework is manageable for many carbon capture projects underway, Fry said. But many environmental requirements are outdated “and didn’t contemplate” the accelerated deployment now being considered, he said.

“Without wholesale rewrites, the opportunities to adjust things in a way that would be more efficient and drive projects at a more reasonable pace” could be lost, he said.

Carbon capture backers say there’s been some progress in states now stepping in to try to fast-track regulatory approvals: states including Wyoming, North Dakota, and Louisiana have taken the reins on some regulatory reviews.

Administration officials say Biden has shown his commitment by backing more generous tax incentives and signing the 2021 infrastructure package, the single largest investment ever of $10 billion in carbon management and carbon capture.

Those efforts still aren’t likely to be enough to construct the 1,000-plus carbon capture projects envisioned to meet U.S. climate goals. Accelerating permitting and even more incentives are needed—including giving projects until the end of 2030 to break ground and still qualify for tax credits—according to the Carbon Capture Coalition, representing industry, labor, and several environmental groups

Beyond its guidance, CEQ is also reworking NEPA requirements, though it’s restoring Obama-era requirements to have agencies consider projects’ indirect and cumulative effects—which carbon capture backers say could slow approvals.

Daunting Review Process

U.S. carbon capture projects have grown rapidly over the last decade to about 45 projects in operation or in the pipeline and 5,200 miles of pipelines—more than any other nation.

But Brittany Bolen, a former EPA policy chief and senior counsel for the Trump administration, said regulatory reviews for such projects are time-consuming. Navigating reviews to inject carbon dioxide into underground wells, which require EPA approving Class VI well requirements, can take four to six years.

Some states have responded by seeking “primacy” which could speed up reviews, said Bolen, attorney and senior policy adviser in Sidley Austin LLP’s environmental and government strategies practices.

Multiple permits or reviews could be required for individual projects, Bolen said at a March 9 Sidley forum on carbon capture. They can include Clean Water Act permits for discharges to surface water; Title V operating permits under the Clean Air Act; new source review pre-construction permits for new or modifying sources; and permits under the Safe Drinking Water Act Underground Injection Control requirements for wells.

“And this is not an exhaustive list,” Bolen said. EPA greenhouse gas reporting requirements also are “a key component” for operations seeking 45Q carbon capture tax credits to verify their stored emissions, she said."

Policies that make it more difficult for working parents to work flexibly should be reviewed and updated

See The Future of Working Parents by Vanessa Brown Calder of Cato. Excerpt:

"For instance, local labor regulations that make workplaces more rigid to “protect” workers make work less flexible and therefore make work and family life less compatible. Meanwhile, federal labor regulations, like the Fair Labor Standards Act, that require workers be compensated for overtime with payment rather than through future time off also make balancing work and family life more difficult. These rules should be reformed to accommodate families with needs for flexible work.

Additionally, regulations that limit gig economy work make flexible work more difficult to come by for parents, especially since parents are more likely than non‐​parents to take gig economy jobs. The Biden administration has said that it is “committed to ending the abusive practice of misclassifying employees as independent contractors, which deprives these workers of critical protections and benefits,” but this is the wrong approach. The administration should consider that a majority of gig workers in a variety of surveys prefer the independent contractor designation that makes flexible work possible and are happy with their employment arrangement.

Moreover, home based businesses must be legalized. Currently, zoning bans and restricts many types of home based businesses, and additional permitting and licensing requirements create barriers to entrepreneurship. As one example, the cottage food industry took off during the pandemic, but in some states like Rhode Island, moms can be shut down for selling something as benign as home‐​baked cookies. This is unfortunate because selling food online—and working from home more generally—are opportunities for working parents balancing childcare needs, families balancing elderly care needs, and for recent refugees and immigrants.

Occupational licensing laws also need reform to accommodate flexible work. For example, certain states require lawyers to have practiced full‐​time for a series of consecutive years to be licensed, and this penalizes working parents that want to work part time or take time off in order to balance family and career. These rules should be reformed to accommodate working parents and workers of all stripes.

This is only a sample of the many reforms that should be made to increase flexible and remote work opportunities, and as workers and companies are rethinking expectations around work, policymakers should rethink the many policies that prohibit the flexible and remote arrangements that working parents crave.

If what parents say is any indication, flexible work is the future. Policymakers would be wise to clear the way for it."

An Oil Leasing Fig Leaf

The Biden Interior Department does the bare minimum to comply with a court order to allow lease sales on federal land

WSJ editorial. 

"In case you missed the Good Friday news dump, the Biden Administration plans to restart oil and gas leasing on federal lands this week. Or so its press release claims. The Administration as usual is restricting oil and gas development while pretending that’s not what it’s doing.

During his first week in office, President Biden ordered the Interior Department to halt oil and gas lease sales on federal lands. Federal judge Terry Doughty last June ruled the ban violated the Mineral Leasing Act, which requires the government to hold quarterly lease sales “for each State where eligible lands are available.” The judge ordered Interior to resume leasing.

Interior appealed while dragging its feet. Finally in November it held an offshore sale in the Gulf of Mexico. But months later another judge vacated the leases, quibbling that Interior didn’t calculate the potential greenhouse-gas emissions from oil produced from the leases that is consumed abroad. Interior didn’t appeal that ruling.

Energy companies threatened to seek another judicial order to compel Interior to hold an onshore lease sale this spring. Interior’s Friday announcement is an attempt to head off that effort. It says it will hold a sale for 173 parcels on roughly 144,000 acres of land. This is doing the least possible to comply with Judge Doughty’s ruling last summer.

This is two-thirds less land than the average during the Trump Presidency. Interior says it is “prioritizing the American people’s broad interests in public lands,” but the sale amounts to a mere 0.00589% of federal land. Americans have a significant interest in more domestic energy production. They don’t want to keep paying more than $4 a gallon for gasoline.

Interior also plans to increase the federal royalty rate for the first time to 18.75% from 12.5%, which it says will “ensure fair return for the American taxpayer and on par with rates charged by states and private landowners.” But the federal rate has long been lower in order to compensate for the more onerous federal permitting process.

The Administration took 182 days to issue a drilling permit last year compared with a few days for the state of Texas. Time carries a monetary value, and the leasing suspension has increased the cost of new investment. It’s hard to avoid the conclusion that Mr. Biden doesn’t want to increase U.S. oil and gas production. He wants to duck political responsibility for high energy prices."

Cut Tariffs to Help Inflation and Ukraine

A modest easing of border taxes could lower inflation by 1.3 points

WSJ editorial.

"President Biden is deploying gimmicks to try to show the public that he is fighting 8.5% inflation, but here’s something he could do that really would help: ease President Trump’s destructive tariffs. This isn’t a panacea. But while prices keep rising, the feds could at least stop making products more expensive on purpose.

A recent paper from the Peterson Institute for International Economics shows the tangible effect that smarter trade policies could have. “A feasible package of liberalization,” it says, “could deliver a one-time reduction in consumer price index (CPI) inflation of around 1.3 percentage points.”

Last week’s CPI report shows that prices are up 8.5% from a year ago. A modest easing of tariffs, in other words, could counteract a meaningful portion of that inflation, which is better than what Mr. Biden is doing. He is releasing oil from the Strategic Petroleum Reserve and permitting summer sales of E15 gasoline, neither of which will matter much. On the other hand, the trade remedy “would amount to $797 per US household, about half the size of pandemic relief in 2021,” the Peterson report says.

Tariffs are taxes. They’re paid by consumers. They make U.S. manufacturing less competitive by driving up the price of inputs like steel. The Peterson report says Mr. Trump raised the cost of Chinese imports by $81 billion. Mr. Biden could aim for overall tariff relief of two percentage points, which comes out to $56 billion in savings. Imports “contribute to 12 percent of the CPI,” and a share of those lower costs “would quickly reach consumers through lower prices at retail outlets,” the authors say. Increased competition would put downward pressure on the prices of domestic goods.

Since the poor spend more of their money on consumption, the report adds, “trade liberalization counts as progressive policy in the same way that cutting a sales tax is progressive policy.” This should also appeal to Republican Senators who claim to be the new tribunes of working people—unless their real trade-policy motivation is corporate welfare.

The White House could further target the tariff relief to staples like clothing and school supplies. Because the President has been granted broad trade power, Mr. Biden could act on at least some of this agenda with the stroke of an autopen.

Good trade policy is also good geopolitics. Sens. Pat Toomey and Dianne Feinstein wrote Mr. Biden this month asking him to “remove the 25 percent U.S. tariff on steel imports from Ukraine to help it eventually stabilize and rebuild its economy.” The immediate effects might be muted, given how the Russian invasion has hampered Ukrainian industry.

But in the longer term it’s a win-win-win: Let Americans buy Ukrainian steel without a hefty border tax, improving competitiveness for U.S. manufacturers. Trim inflation. And help a country struggling for freedom regain its economic footing. What is Mr. Biden waiting for?"

Hamptons Opponents Hound Offshore Wind-Power Project

Residents of the exclusive New York hamlet of Wainscott are waging legal battles that could further complicate a project to power 70,000 homes 

By Amrith Ramkumar and Jennifer Hiller of The Wall Street Journal. He is a senior fellow at the Manhattan Institute. Excerpts: 

"South Fork Wind will power 70,000 homes around East Hampton, N.Y., when it starts generating electricity next year. Construction began recently after a six-year approval process from federal, state and local governments."

"More than 200 wind and solar projects face local opposition"

"That is up from roughly 165 in September."

"Opponents say they support the project and clean power but feel the cable’s installation will disrupt residential life and contaminate the area. Other routes would be less intrusive, they argue."

"The Mahoneys have filed a lawsuit against federal agencies alleging they didn’t adequately assess environmental and pollution risks, including groundwater contamination."

"Locals in eastern Washington state have fought wind and solar farms that would cover hundreds of acres and deliver power largely to urban areas such as Seattle. The projects mar vistas and hurt tourism and wildlife in the state’s shrub-steppe habitat and wine country, said state Republican Rep. Mark Klicker. 

The height and blinking lights of wind projects can ruin the landscape, he said. “They dwarf the Seattle Space Needle,” he said."

BLM’s Anti-Police Racket Is Coming Undone

The organization has squandered its moral authority by acting like a hustler on the make 

By Jason L. Riley. He is a senior fellow at the Manhattan Institute. Excerpts:

"After the New York Post reported in April 2021 that a BLM co-founder had purchased four homes for a total of $3.2 million, the head of a local BLM chapter in New York City called for an independent investigation into how money was being spent. In July, BLM leaders in Canada, with help from its U.S. affiliate, purchased another multimillion dollar mansion in Toronto, which prompted several activists in the local chapter to resign. And earlier this month, New York magazine reported that BLM leaders purchased a $6 million California home in cash with money that had been donated to the organization.

“The transaction has not been previously reported, and Black Lives Matter leadership had hoped to keep the house’s existence a secret,” the article said. “Internal emails dating to 2016 show activists voicing concern about how donations were being spent and how the organization was being run. . . . The families of some Black victims of police violence have complained that they have seen little of the funds that have flowed to the movements most visible facet.” Floyd’s death produced a windfall for the group. In October 2020, it took in $66.5 million in contributions. Weeks later, it purchased the California property. BLM told the magazine that it had “always planned” to disclose the purchase, but didn’t explain why it hadn’t."

"attorneys general in California and Washington state had ordered BLM to cease fundraising activities until the group submitted delinquent financial disclosures. The organization told Fox that “we take these matters seriously and have taken immediate action.” If the public doesn’t know more about these shenanigans, New York magazine explained that it might be because the organization carefully monitors social media for negative mentions, “with members using their influence with the platforms to have such remarks removed.” It’s also hired private investigators “to look into [BLM] detractors and journalists.”"

"The BLM movement’s other problem is that its prominence has been propelled in part by lies and half-truths. Michael Brown was shot dead after he attacked a police officer, and the “Hands up, don’t shoot!” story is a myth. Trayvon Martin was a troubled young man, and based on physical evidence the jury determined that Mr. Zimmerman fired at him in self-defense.

"There is nothing wrong with calling out dirty cops or police brutality, which aren’t figments of black people’s imaginations. But neither do most blacks believe, as BLM types insist, that policing is a larger problem than criminal behavior."

BLM represents a fringe minority of black Americans rather than the mainstream majority. A Pew Research Center survey released last week found that crime is the top concern of black adults, which is nothing new. The 1968 Kerner Commission report noted that the loudest complaints from black neighborhoods concerned the lack of police protection—specifically, the relatively small number of cops assigned to black neighborhoods and their slow response to emergency calls."

Student-Loan Reparations

Biden takes another big step toward mass debt forgiveness

WSJ editorial.

"The Biden Administration this week announced another installment in its student-loan forgiveness plan to “fix longstanding failures” in the program. Translation: Taxpayers will pay again for the mistakes of Congress and the Obama Administration.

Congress created income-based repayment plans in 2007 to help borrowers manage mountains of debt they can’t repay. Initially borrowers could cap monthly payments at 15% of their discretionary income and discharge their remaining balance after 25 years. Those who went to work in “public service” had to pay 10% for 10 years.

Democrats made the terms more generous when they nationalized the student-loan market to pay for ObamaCare, reducing payments for new borrowers after June 2014 to 10% of their income and canceling debt after 20 years. In the runup to the 2016 election the Obama Administration expanded these plans to older borrowers.

Many of the eight million or so borrowers now enrolled in these plans aren’t paying enough to reduce their balances and have continued to accrue interest. This is one reason federal student debt has more than doubled since 2010, even though the number of borrowers has increased by only some 25%.

The plans have also been a headache for loan servicers that have to certify income, which can change. Rather than enroll in the plans, many borrowers have opted to pause payments for a time, though this means their loans won’t eventually be forgiven. Progressives have lambasted servicers for following borrowers’ wishes.

The Education Department is now riding to the rescue by announcing it will credit up to three years of paused payments toward loan forgiveness—on top of the two-years-and-counting pandemic pause. The Administration is taking the “income” and “repayment” out of income-based repayment.

About 3.6 million borrowers will benefit. Who knows how much it will cost, but an internal Trump Administration analysis projected that the government would lose $435 billion on the $1.4 trillion federal loan balance in 2018, mainly due to these loan forgiveness plans. That was before the pandemic pause.

The Administration has already canceled more than $100 billion in student debt by discrete regulatory actions and extending the pandemic pause through August. None of this has been authorized by Congress or satisfied the demands of progressives. White House Press Secretary Jen Psaki tipped last week that the pause will “be extended again or we’re going to make a decision” about “canceling student debt.”

Progressives won’t sleep until President Biden erases all $1.6 trillion in federal student debt. As ever, the saps are those who worked to repay their debt on time."

Mississippi Loses Some Licensing Weight

A dietician wins a legal victory over health department tyrants

WSJ editorial.

"Mississippi residents have the highest obesity rate in the U.S., but the state is about to shed a few regulatory pounds. Raise your protein shake to personal trainer Donna Harris and her lawyers at the Mississippi Justice Institute.

Effective May 16, the Mississippi State Department of Health will no longer require residents who don’t claim to be dieticians to get a dietician’s license before they can offer non-medical weight-control services. The reform is part of a settlement with Ms. Harris, who was targeted by state regulators.

In addition to her personal trainer’s certification, Ms. Harris has a bachelor’s degree in food science, nutrition and health promotion and a master’s in occupational therapy. In early 2020 she debuted a weight loss challenge that included one-on-one coaching and a private Facebook page where participants could swap recipes and cheer for each other. Seventy people paid $99 for her eight-week program.

Enter the state health department, which complained that Ms. Harris was working as an unlicensed dietician, though she never claimed to be one. Regulators threatened her with six months in jail, a fine of up to $1,000, and criminal and civil actions if she didn’t cease and desist. That forced Ms. Harris to cancel her program, and she refunded nearly $7,000 to those who had signed up. 

Ms. Harris sued, claiming that the health department’s rules amounted to “government censorship of speech on the age-old topic of weight loss.” Under an agreement reached late last year, the health department agreed to tighten its regulatory belt.

The fat old rules were prohibitive. Mississippi’s requirements for a dietician’s license have fluctuated amid the pandemic, but when Ms. Harris began her program she would have had to undergo 1,200 hours of supervised practice and pay $300 for exams and fees.

Occupational licensing laws are a form of guild protectionism that reduces competition and blocks millions from making a better living. Congrats to Ms. Harris on this victory over petty government tyranny."

Jesus a Socialist? That’s a Myth

The early church was egalitarian, but it wasn’t committed to an economic system

By Alexander William Salter. 

"The idea that the teachings of Jesus are akin to socialism has been spreading around the internet for years in the form of memes, chain emails and Facebook posts. Some elected officials have a history of supporting the idea: The Rev. Raphael Warnock, a U.S. senator from Georgia, contended years ago that “the early church was a socialist church.” He’s not alone in holding this misguided belief.

A much-cited passage from the Acts of the Apostles, the first work of church history, has strong socialist overtones. Christian socialists use this passage to argue socialism was a historical reality for the followers of Christ. If they’re right, that has huge implications for a country that remains majority Christian. Fortunately, they’re wrong.

Acts 4:32-35 gives believers a picture of a highly egalitarian church. Among the believers, “no one claimed private ownership of any possessions.” Those who had property sold it and brought it to the church. The proceeds were “distributed to each as any had need.” This sounds almost like the classic Marx line—“from each according to his ability, to each according to his needs”—but read a little further.

Acts 5 contains a harrowing account of two church members, Ananias and Sapphira, who sold their property but lied about the price. Confronted in their deceit by St. Peter, they suddenly perish. The passage states they were not punished merely for holding back their wealth. “Were not the proceeds at your disposal?” St. Peter asks, indicating the property and its fruits were theirs. The real lesson is the imperative of absolute truth before God. For those who have received the Holy Spirit, falsehood is perilous.

Later, Acts tells of St. Paul’s missionary journeys, during which he worked as a tentmaker to support his ministry. While not motivated by private profit, Paul nevertheless made recourse to the marketplace. Also, we know from his letters he solicited financial support for the Jerusalem church throughout his travels. Early Christians wouldn’t have been able to donate without producing and trading. There’s scant biblical evidence for a wholesale condemnation of ownership and commerce.

Ultimately claims of early church socialism miss the mark because they conflate two kinds of communities: organizations and orders. Organizations are consciously crafted to achieve the goals of their members. Orders are spontaneous and emergent, arising out of the interactions between organizations. Businesses, educational institutions, charities and communes are organizations. But economic systems like socialism and capitalism are orders.

Calling the church an organization in no way diminishes its divinity. It simply means one can think about the church, in part, as an intentional community with its own canons and customs. This matters greatly for interpreting early church history.

Whether discussing a 21st-century business corporation or a first-century religious society, who gets what is determined by purposefully designed rules. Those rules can be meritocratic (bonuses and stock options) or egalitarian (relief for widows and orphans). They can be consensual (committees, voting) or hierarchical (executives, commands). But they aren’t socialistic. Neither are they capitalistic. Those terms refer to orders, not organizations.

Markets didn’t allocate resources inside the church, but that’s true of any organization. In fact, the whole point of organizations, for-profit or not, is to avoid markets. They’re temporary shelters against the fickle forces of supply and demand. If we call “socialism” all attempts to suppress the market allocation of resources, then even the most profit-hungry firm you can think of is socialist. Zoom in close enough and all organizations look like central planners.

It’s foolish to apply the categories of economic systems to the church. Socialism regiments society, an unplanned give-and-take among countless organizations, according to an all-encompassing economic blueprint. That isn’t the church’s mission. Reconciling all of creation to God in Christ is. While the church has a strong communitarian ethos, it isn’t committed to a specific set of economic institutions. Exploring the church’s internal constitution can be fascinating, and the generosity of the earliest Christians should serve as an example for us. But this has no relevance to the merits of single-payer healthcare or nationalizing railroads.

Knowing whether an economic system comports with Christianity requires careful study of the church’s social teachings, but church history matters too. Historical memory and interpretation are powerful forces for shaping contemporary beliefs. A socialist can be a good Christian, but the narrative of early church socialism is a myth.

Mr. Salter is an economics professor at Texas Tech University, a research fellow at TTU’s Free Market Institute, and a senior fellow at the American Institute for Economic Research."

Retirees’ Re-Entering the Labor Market Isn’t ‘Good for the Economy’

There’s more to wealth than work

By Walter E. Block.

"Does inflation increase wealth? That is the contention of some economists and business journalists who should know better. Inflation has a silver lining for economic welfare, they claim, or price increases are good for the economy as a whole.

The argument in a nutshell is that inflation induces newly impoverished retirees back into the labor force. Their work increases gross domestic product, and we will all benefit from the increased goods and services it creates. So too for those who put off retirement, unable to afford it because of inflation.

It is true that inflation makes people on fixed incomes poorer, and that some people respond by going back to work. But does that really help the economy?

No. It boosts the GDP and its growth prospects, but it hardly amounts to an overall economic benefit. Economics 101 teaches that there is such a thing as a labor-leisure dichotomy. Why don’t people seek to work all the time? Because they value the leisure they would thereby forgo more highly than the additional money they could earn. Most people are reasonably happy with 40-hour weeks and a vacation of one month a year or so. But GDP would be higher if they labored 80 hours a week and took no holiday at all. The prospects for economic growth would also increase.

Would the average person be happier, and would it help the economy, if people were compelled to work that much more merely to boost GDP? Of course not. Most people would be miserable with 80-hour workweeks, and economic conditions would be worse, not better.

The same considerations apply to the decision to retire. Many people look forward to retirement and regard the leisure they obtain as a greater value than the extra wages they could earn by remaining on the job. But then inflation hits. They feel—and actually are—poorer than they were before. So they return to the labor force.

The returning workers may have more money, but, based on their own revealed preference, the leisure they had to forgo was of even more value. That decision is good for the economy, only if we define “the economy” merely as maximizing GDP.

Mr. Block is a professor of economics at Loyola University New Orleans."

How to Kill American Infrastructure on the Sly

The White House revises NEPA rules that will scuttle new roads, bridges and oil and gas pipelines

WSJ editorial.

"Americans are going to need a split-screen for the Biden Administration’s policy contradictions. Even as the President on Tuesday promoted the bipartisan infrastructure bill he signed last November, the White House moved to make it harder to build roads, bridges and, of course, oil and natural-gas pipelines.  

The White House Council on Environmental Quality is revising rules under the National Environmental Policy Act for permitting major construction projects. CEQ Chair Brenda Mallory says the changes will “provide regulatory certainty” and “reduce conflict.” Instead, they will cause more litigation and delays that raise construction costs, if they don’t kill projects outright.

NEPA requires federal agencies to review the environmental impact of major projects that are funded by the feds or require a federal permit. Reviews can take years and run thousands of pages, covering the smallest potential impact on species, air or water quality. Project developers can be forced to mitigate these effects by, say, relocating species.

While the 1970 law was intended to prevent environmental disasters, it has become a weapon to block development. The Trump Administration sought to fast-track projects by limiting NEPA reviews to environmental effects that are directly foreseeable—e.g., how a pipeline’s construction would affect a stream it crosses.

Some liberal judges, however, have interpreted NEPA broadly to require the study of effects that indirectly result from a project such as CO2 emissions. Now the Biden Administration is mandating this. CEQ’s new rule will require agencies to calculate the “indirect” and “cumulative impacts” that “can result from individually minor but collectively significant actions taking place over a period of time.” This means death by a thousand regulatory cuts for many projects.

The Transportation Department will likely have to examine how a highway expansion could increase greenhouse-gas emissions in concert with new warehouses. The Federal Energy Regulatory Commission might have to calculate how a new pipeline would affect emissions from upstream production and downstream consumption.

Wait—didn’t FERC recently walk back its policy to do exactly this? The White House is thumbing its nose at West Virginia Sen. Joe Manchin, who blasted FERC’s now-suspended policy for shutting “down the infrastructure we desperately need as a country.”

The rule’s obvious intent is to make it harder to build pipelines, roads and other infrastructure that would enable more U.S. oil and gas production, even as the Administration makes phony gestures to reduce energy prices. Last Friday the Administration announced it would comply with a court order to hold oil and gas lease sales on public land. Those leases won’t matter if energy companies can’t get federal permits for rights-of-way.

While fossil fuels may be the rule’s political target, don’t be surprised if green energy is snagged in this trip-wire. Environmental groups have used NEPA to block new mineral mines and transmission lines that connect distant renewable energy sources to population centers. In this Administration, the left hand doesn’t seem to know what the far left hand is doing."

California’s Medical ‘Misinformation’ Crusade Could Cost Lives

As with Covid treatment, the intolerance of different views risks stifling scientific advances

By Allysia Finley of The WSJ. Excerpts:

"Early in the pandemic, Covid patients with very low oxygen levels were put on ventilators, the standard of care for severe respiratory diseases. But some doctors noticed that severely ill patients responded better to noninvasive ventilation such as high-flow nasal tubes. They shared their findings with other physicians, and gentler oxygen support became the norm. That change in treatment has saved tens of thousands of lives.  

But it would have been illegal under a new bill that Democratic lawmakers have proposed in California. The legislation would require the state Medical Board to take action against doctors found to be spreading “misinformation” related to the “nature and risks of the virus, its prevention and treatment; and the development, safety, and effectiveness of COVID-19 vaccines.”

What is “misinformation”? It’s not clearly defined, but the bill would instruct the board to consider whether a doctor’s order or opinion deviates from the “standard of care” (i.e., recommendations by government bodies or treatments that are widely used by healthcare practitioners) and is “contradicted by contemporary scientific consensus.”

So doctors who prescribe or recommend treatments that haven’t been approved by the Food and Drug Administration for Covid-19—for example, the antidepressant fluvoxamine, which has shown strong results in trials—could be disciplined and even lose their medical licenses no matter if they have scientific evidence to support them. Same for doctors who disagree with masking and vaccines for children."

Much of what was learned early in the pandemic was from doctors sharing their clinical experiences and knowledge. Patients receiving oxygen did better when placed in a prone position, for instance, and the steroid dexamethasone could tamp down the “cytokine storm” in severely ill patients. Early in the pandemic some doctors hypothesized that the virus could spread through aerosols, and therefore 6 feet of distance wouldn’t necessarily prevent infection. This outlier view could have been deemed misinformation under California’s law. It is now conventional wisdom."

"Emails obtained by the American Institute for Economic Research showed how the National Institutes of Health’s Francis Collins and Anthony Fauci tried to discredit the authors of the Great Barrington Declaration, which opposed the lockdown consensus. “This is a fringe component of epidemiology,” Dr. Collins told the Washington Post. “This is not mainstream science. It’s dangerous.”" 

‘Green Inflation’ Is Nothing New. But More Is on the Way

We pay once in higher general prices and again for energy.

Letter to WSJ.

"The “The Coming Green-Energy Inflation” ( Mark Mills, op-ed, April 18) is already here. The hundreds of billions of federal dollars spent on “green” energy has been increasing budget deficits for decades—and thus inflation finance (monetary expansion).

Start with the Energy Department’s civilian energy programs; continue with the tax subsidies for politically correct, economically incorrect renewable energies. The “temporary” Production Tax Credit for wind power, enacted in 1992, has been extended 13 times. The Investment Tax Credit for solar has been extended thrice. Add the $7,500 tax credit that most electric vehicles owners receive, and the picture becomes clear. “Green inflation” needs to enter the lexicon as a double whammy. We pay once in higher general prices and again for energy.

Robert L. Bradley Jr.

Institute for Energy Research

Washington"

Corporate Tax Reform Worked

Revenue is surging, exceeding what CBO and critics predicted

WSJ editorial. 

"Democrats are still looking to raise $1.6 trillion in new taxes this year, and even Joe Manchin says he’d support a corporate tax increase. The West Virginia Senator might reconsider if he looks at the actual revenue results of the 2017 tax reform that cut corporate tax rates. Reform has been a winner for the economy and federal tax coffers.

Remember the claims during the 2017 tax debate that reform would drain the Treasury, especially the cut in the corporate income tax rate to 21% from 35%? Corporate revenue was supposed to fall to historic lows as a share of the economy. Big business supposedly got a windfall and government was robbed.

It hasn’t turned out that way. Corporate tax revenue declined in the immediate wake of reform as the rates fell. But the big news now is that more corporate tax revenue is flowing into the Treasury at record levels even with the lower rate.

The nearby table tells the story for fiscal year 2021, with an estimate for fiscal year 2022 based on results in the first half through March. The pandemic year of 2020 was anomalous, but by fiscal 2021 the economy had recovered enough to make a fair comparison between the revenue that the Congressional Budget Office predicted and what happened.

In June 2017, before tax reform passed, CBO predicted corporate tax revenue of $383 billion in fiscal 2021. But in April 2018, after reform passed, CBO lowered its estimate to $327 billion. Actual corporate income tax revenue in 2021 was $372 billion—nearly as much at a 21% rate as CBO expected at the 35% rate that was among the highest in the world.

Fiscal 2022 is turning out to be even better for the Treasury. Corporate tax revenue for the first six months was up 22% from a year earlier to $127 billion. William McBride of the Tax Foundation estimates that if the pace of the first half continues, corporate tax revenue will hit a new record of $454 billion in fiscal 2022. (Corporate tax revenue increases in the back half of the year.)

That compares to CBO’s estimate after tax reform of only $353 billion. Corporate revenue of $454 billion would exceed the annual revenue that CBO predicted from the corporate tax all the way through fiscal 2028 ($448 billion).

What accounts for this windfall for Uncle Sam and a comparable one for state tax coffers? Corporate profits have been very strong, and government is sharing in the wealth even at a lower rate. Inflation in the last year has also increased nominal corporate profits, though CBO’s estimates did include some inflation.

But the Occam’s razor policy answer is that corporate tax reform worked as its sponsors predicted: Lowering the rates while broadening the base by eliminating loopholes created incentives for more efficient investment decisions that paid off for shareholders, workers and the government.

One example is the way reform provided an incentive for companies to repatriate overseas earnings to invest in the U.S. Dan Clifton of Strategas Research Partners says companies have brought back some $1.8 trillion since the 2017 reform. Previously, companies that repatriated capital paid a punitive tax rate. They kept the money abroad instead.

Mr. Clifton estimates that the repatriation of overseas earnings amounted to about 2.4% of GDP from 2018-2021, versus 1% from 2014-2017 and 0.9% from 2010-2013. Reform supporters predicted this. Mr. McBride of the Tax Foundation estimates that corporate tax revenue this year will come in at 1.9% of GDP, the highest level since 2015 and higher than CBO’s prediction before tax reform.

All of which suggests that it would be a mistake to raise corporate taxes on either economic or revenue grounds. Mr. Manchin is worried about the budget deficit, but it’s hard to see corporate tax revenue rising at a faster pace than 22% a year. Higher rates would restart the game of companies looking to invest elsewhere in search of lower rates.

The 15% global minimum corporate tax that Treasury Secretary Janet Yellen is pushing still hasn’t been ratified by many nations—and may never be. Democrats would be passing a tax increase whose main effect would be to make U.S. companies less competitive. It would be the Chinese business advantage tax.

By the way, individual income-tax revenue rose by $300 billion, or 36%, in the fiscal year through March from the same period in 2021. Washington is having a very good year and doesn’t need more money to spend."

An Economist’s Winding Path to an Inflation Reality Check

Alan Blinder goes from ‘Team Transitory’ to ‘wish the Fed luck.’

Letter to WSJ. 

"Alan S. Blinder has had an epiphany (“Wish the Fed Luck as It Seeks a Soft Landing on Inflation,” op-ed, April 7). Just two months ago, Mr. Blinder, a self-acknowledged member of “Team Transitory,” implored the Federal Reserve to raise interest rates “gently.” He now says that at the time he believed that the Fed had “a fighting chance—probably below 50%” of controlling inflation. If the problem was that bad, why did he want the Fed to “wait to see how things unfold”?

Two months ago, he also said the Fed was behind the curve in ending its bond buying. Now he says the Fed’s only tool is to raise interest rates. Apparently he is not concerned that M2 is at an eye-popping $21.8 trillion; there is enough liquidity in the economy to keep the fires burning should inflation expectations ramp up.

Mr. Blinder takes solace that the 10-year break-even inflation rate is only 2.8%. But that measure is a terrible indicator of future inflation, which is notoriously difficult to predict. One would think that a member of Team Transitory from only two months ago would be more reticent in predicting where inflation is heading.

Dan Thornton

Des Peres, Mo.

Mr. Thornton was vice president of the Federal Reserve Bank of St. Louis."

The Coming Green-Energy Inflation

Demand for metals and other commodities will keep skyrocketing unless mandates are reversed

By Mark P. Mills. He is a senior fellow at the Manhattan Institute. Excerpts:

"Producing energy from wind and solar machines, and especially from batteries, requires an enormous increase in supplies of copper, nickel, aluminum, graphite, lithium and other minerals. Each electric vehicle contains about 400 pounds more aluminum and about 150 pounds more copper than a conventional car. That’s really going to add up at the proposed levels of production. The same goes for the suite of minerals necessary to build the tens of thousands of wind turbines and millions of solar modules needed for green plans. Unfortunately, as the International Energy Agency and others have pointed out, supply of critical minerals isn’t expanding apace. Not even close. That’s an incendiary formula for inflation.

To wit: In Paris on March 24, the IEA convened a summit of member nations to strategize on replacing Russian oil and gas supplies while also reaffirming “decarbonization” goals. Attendees issued a declaration to “accelerate” as a “top priority” the green-energy transition to replace hydrocarbons. President Biden and the president of the European Union both reinforced the theme of a green-energy “double down.”

On the face of it, that seems logical. Huge increases in the use of solar and wind power, and electric vehicles, could displace enough fossil-fuel use to bring down prices of natural gas and oil. Or it could insulate markets from inflation triggered by the loss of, or sanctions against, of Russian supplies. Energy Secretary Jennifer Granholm said as much when opening that Paris summit.

Whether realistic or not, the mere pursuit of such a strategy is inflationary. And it would last longer than food or fuel inflation. International Monetary Fund economists last year looked at mineral commodity data going back to 1879. They calculated the inflationary impact from trying to meet mineral demands to build enough machinery for a green double-down. Metal prices would reach historical peaks, they wrote, “for an unprecedented, sustained period of roughly a decade.” The IMF also pointed out that the “integrated assessment models” for the energy transition “do not include the . . . potential rise in costs.”"

"Lithium—now well-known because of car and grid batteries—has seen prices soar nearly 1,000% in the past two years. Prices of copper and nickel, more widely used, are up 200% and 300% respectively over the same period. Aluminum, the second-most-used metal on earth after iron ore, is up 200% and trading at a 30-year high.

While metals historically have constituted a minor share of the fabrication cost of most products, the picture changes with stratospheric input prices. A doubling of aluminum prices would add input costs that wipe out nearly the entire profit margin for U.S. manufacturers of heavy vehicles, according to a 2020 United States Geological Survey paper. Higher prices for cars and trucks are inevitable.

Commodity materials inflation has already ended the long-run decrease in battery, solar-module and wind-turbine costs. That’s because minerals alone constitute over half the cost of fabricating batteries and solar modules, and about 20% for wind turbines. Well before the latest mineral escalations, forecasters saw cost rises in 2022 of 5% for batteries, 10% for wind machines and 25% for solar modules. The biggest Chinese and U.S. electric-vehicle makers, BYD and Tesla, recently announced price increases.

The potential for greater inflationary pressure should be obvious. Despite fast growth, the world still gets only 3% of its energy from wind and solar. Less than 1% of all cars on global roads are battery-electric. ING determined in late 2021 that a double-down on electric-vehicle goals would alone soak up about half of all current aluminum and copper production and about 80% of global nickel output."

"Mining is like anything else. Eventually high prices stimulate more production. But the slow real-world expansion capabilities of mining explains the IMF’s forecast that mineral inflation would last “roughly a decade” until supply catches up.

Most analysts focus on where the gigatons of new minerals will come from, and the derivative geopolitical impacts of the new supply chains. It would shift Europe’s dominant dependency from Russia to China; for America, from domestic industries to China. But policy makers are going to be hit first by the fast and furious inflationary effects of chasing minerals."

Deregulate Home Food Businesses

By Chris Edwards of Cato.

"The pandemic has created lasting changes to the economy. More employees are working from home, videocalls are replacing business travel, and home‐​based entrepreneurship is booming. The internet is a key driver of home entrepreneurship—the number of arts‐​and‐​crafts businesses on Etsy​.com, for example, jumped from 2.6 million in 2019 to 7.5 million by 2021.

Another thriving area of internet‐​driven entrepreneurship is home‐​based food production for retail sale, often called the cottage food industry. Popular cottage foods include baked goods, canned goods, pickled goods, chocolates, candies, jams, fruit pies, honey, and pasta.

Home‐​based food businesses offer entrepreneurs cost savings and lifestyle advantages. Aspiring entrepreneurs may not be able to pursue their dreams if they have to rent commercial kitchen space and pay for childcare and commuting. Homes are a low‐​cost incubator to test business ideas before making larger investments. The vast majority of commercial craft brewers, for example, got their start brewing at home.

However, cottage food industry growth faces a major barrier: government health and zoning rules that ban, restrict, or raise costs for home‐​based businesses, as I discuss here. State and local rules vary widely regarding food items that can be sold, where they can be sold, and the sales volume allowed. At one end of the freedom spectrum, Wyoming home businesses can sell any type of food except meat within an annual sales limit of $250,000. At the other end of the spectrum, Rhode Island only allows farmers to sell food made in their homes, and even sales from farmers are tightly restricted.

The New York Times on Monday profiled the rise in internet sales of food produced by small businesses, including home businesses. The article captures the tension between restrictive regulations and the desire of individuals to earn a living from their passion for food.

Several days a week, Juliet Achan moves around the kitchen of her apartment in Greenpoint, Brooklyn, stirring up dishes from her Surinamese background: fragrant batches of goat curry, root vegetable soup and her own take on chicken chow mein.

She packages the meals, and they are picked up for delivery to customers who order through an app called WoodSpoon. “Joining WoodSpoon has made a huge difference during the pandemic, giving me the flexibility to work safely from home and supplement my income,” Ms. Achan said in a news release from the company in February.

However, in the state of New York, there are no permits or licenses that allow individuals to sell hot meals cooked in their home kitchens. And WoodSpoon, a three‐​year‐​old start‐​up that says it has about 300 chefs preparing foods on its platform and has raised millions of dollars from investors, including the parent company of Burger King, knows it.

… start‐​ups like WoodSpoon and Shef have emerged, pushing what has been an underground industry of selling food to friends and family into the mainstream through apps.

… The companies paint themselves as part of the new gig economy, a way for the people making the food to earn a little or a lot of money, working whatever days and hours best fit their schedules. Selling meals online presents an opportunity for women who have struggled to work outside the home because of limited child care options or for refugees and recent immigrants, said Alvin Salehi, a senior technology adviser during the Obama administration and one of the founders of Shef.

… From her kitchen in the Lower East Side of Manhattan, María Bído uses WoodSpoon to sell classic Puerto Rican dishes like mofongo, bacalaitos and sancocho, using recipes she learned from her grandmother. “My whole life, people told me, ‘You need to do something with your food,’ but I always shut myself down without even trying,” Ms. Bído said. “How are you going to do that? How is it going to happen? How is it going to work out? “Now I have weekly income. I can see my earnings. And I’m getting reviews.” She believes this will help toward her next goal of moving to a commercial kitchen and offering her specialties across the country.

Some people may think that tight restrictions make sense for safety reasons. One problem with that position is that if laws are too strict, cottage food goes underground. Atlanta magazine examined Georgia’s cottage food laws. Before reforms, producers “were prohibited, under most circumstances, from selling any type of food that was not prepared in a commercial‐​grade kitchen used solely for commercial purposes.” So “if you wanted to sell birthday cakes out of your home, you had to build a second kitchen used only for that purpose.” The result was “a lot of home cooks selling baked goods under the table, without licensing or food safety training.” With reforms in Georgia, home entrepreneurs can now sell many foodstuffs, including “breads, cakes, cookies, fruit pies, jams and jellies, dried fruits, herbs and mixtures, cereals and granola, nuts, vinegars, popcorn and candies.”

Another problem with overly restrictive rules is that they strangle nascent entrepreneurship and undermine the economy. Harvard Law School’s Food Law and Policy Clinic profiled Mark Stambler, who was shut down by Los Angeles County for selling bread made in his home. Stambler fought back and was successful in getting local cottage food laws liberalized. His business grew, he won baking awards, and he ultimately founded a successful brick‐​and‐​mortar business. The Harvard researchers noted that because “Mark was able to start his business out of his home kitchen, he was able to test the market for his product and take a risk that ultimately led to a very successful business.”

I don’t know what level of cottage food regulation is ideal. I do know that markets generally work better than regulations, and that when regulations are too tight, activities go underground to nobody’s benefit. Cottage food laws vary widely by state, and so an obvious way forward is for the most restrictive states to consider reforms to match the freest states. Rhode Island, which shuts down moms for selling home‐​baked cookies, could learn from Wyoming, which “is a model for the food freedom approach.”

People want to produce food at home to earn income, to test business ideas, and to benefit their communities. Other people want to buy the products, and a general rule of markets is that voluntary exchanges are mutually beneficial. So rather than knee‐​jerk banning home food production, governments should work to facilitate the growing industry and expand opportunities for food entrepreneurs."