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Archives for Policy Memos

Minnesota Free Market Institute: Public Comment on Clean Water Act Guidance

The Minnesota Free Market Institute submitted a public comment last week to the EPA’s “Guidance” on the Clean Water Act. Under the leadership of policy fellow, Don Parmeter, we critiqued the Guidance and concluded that it should be withdrawn. We also submitted a letter from a coalition of individuals and organizations.

Why? The Obama administration, through the President’s Council on Environmental Quality, Environmental Protection Agency, and the U.S. Army Corps of Engineers, wants to control all the land and water in Minnesota.

Legislation that would have given the federal government that kind of unprecedented control went up in flames last year along with the 36-year political career of the bill’s author, Minnesota Congressman James Oberstar. But the Obama Administration won’t take no for an answer, and is now attempting to ignore two U.S. Supreme Court decisions, the will of Congress, the rights of state and local governments, and the vast majority of the American people.  Through this proposed “Guidance'” document, federal jurisdiction would be greatly expanded to effectively seize control of all water and land in the country.

This outrageous proposal has the backing of the wealthy and powerful environmental lobby, so we need to educate Minnesotans and our leaders to prevent this Guidance from becoming the “new” reality in Minnesota.

We will send our comment and that of our coalition members to our Congressional delegation with a special note to Senator Amy Klobuchar who is a member of the Senate Environment and Public Works Committee, and  co-author of the modified Oberstar/Feingold Clean Water Restoration Act that passed the Committee in June of 2009.

Here is an excerpt: This Guidance attempts to clarify the scope of the Agencies’ jurisdiction under the Clean Water Act following the 2006 decision by the U.S. Supreme Court in Rapanos v. United States. Through these actions, the Agencies expect to provide clarity for field staff and the regulated community, and fulfill the full extent of their obligations under CWA. The intended clarity, however, will not be provided by the Guidance document, because it leaves unresolved questions of proper rulemaking procedure, runs contrary to recent Supreme Court decisions, provides an unduly broad and ambiguous test for jurisdiction, and is insufficiently supported by scientific and economic data in its cost-benefit analysis.

And our Conclusion: In summary, the Agencies should take into account the following suggestions. Firstly, the content of this action does not lend itself to guidance for the reasons previously mentioned above, and ought to be immediately promulgated through a rulemaking which would be afforded the statutory safeguards of the APA instead. We reject the idea that the Guidance should serve temporarily until it can be replaced by a final rule. Secondly, because the content of this Guidance is clearly at odds with Supreme Court precedent, the standards for determining jurisdiction should be reconsidered, and promulgated through the rulemaking process. Thirdly, the standard for significance expressed in the Guidance is inappropriate, both because of court precedent and because it does not grant either clarification or certainty to those who must abide by it. Fourthly, the Agencies overlooked a number of cost factors which would seriously impact the cost-benefit analysis provided for in this Guidance, and which, if included, would make a strong case against proposing these standards through a guidance document rather than through the rulemaking process. Barring further analysis, the Agencies should clearly specify that the Guidance will only affect CWA Section 404 programs.

You can read the entire 14 page comment here. 

We will continue to educate Minnesotans and our elected officials about the danger of this Clean Water Act Guidance in the months to come.

One Year Later: Frank-Dodd “Reform” Leaves Fannie and Freddie Intact

You may recall that we have covered the Minnesota angle to the  Durbin Amendment to Frank-Dodd to bring light to the price controls and other measures designed to interfere with debit fees.  We joined the Competitive Enterprise Institute, Americans for Tax Reform and 60 Plus in comments to the Federal Reserve last winter on this issue.   Our friend and colleague, John Berlau, from the Competitive Enterprise Institute, has an article in National Review  “Dodd-Frank’s Fannie Trap”   that neatly updates us on this behemoth legislation parading as reform.

Recall that it was Fannie and Freddie that helped drive out nation to the brink of financial melt-down in 2008. It’s now 2011. Where are we?

Fannie and Freddie now securitize nine out of ten (90%) of home mortgages and have unlimited funding from you and me. This does not look Democratic Capitalism to me. That percentage is inverted from where it ought to be; the private mortgage market has been driven out of business by the Feds.

Berlau says there may be good news:

The good news is that a strong bipartisan bloc of more than 320 members of Congress isn’t buying the administration’s line. The legislators have written to regulators demanding the new rules be scrapped. The bad news is that if Congress doesn’t move fast to repeal, delay, or modify the qualified-residential-mortgage provisions, the administration is likely to dig in its heels, and the GSE-expansion option will become more appealing, even to some Republicans. Witness the bill of Rep. John Campbell (R., Calif.), which would create a single GSE potentially more costly than Fannie and Freddie

Thanks for the heads up, John and CEI!

Recessions and Recoveries: Lessons Not Learned by Tom Kelly

Tom Kelly is the chairman of the Minnesota Free Market Institute. He is also a fellow at the Center of the American Experiment (CAE) and a partner in the Finance and Restructuring Department at Dorsey & Whitney. He wrote the following piece for CAE and we republish it with CAE’s gracious permission. You can read Mitch Pearlstein’s wonderful forward and Tom’s piece entitled Recessions and Recoveries: Lessons Not Learned here.  Tom has a wonderful, conversational style we think you will enjoy. He explains why Keynesian policies have been and continue to be a failure–and why politicians are so attracted to them despite those failures. And Tom offers five lessons in hopes that we can stop repeating the past:

Lesson One: The future belongs to the new.

Lesson Two: The “new’ comes from the private.

Lesson Three: Creation requires destruction.

Lesson Four: Recessions are a normal part of the economic cycle.

And Lesson Five: Government must let markets solve economic problems.

Here is a teaser to get you started:

“We are now three years into the financial crisis triggered by the bursting of the housing bubble, and more than two years into the resulting recession and lingering aftermath. It was the deepest recession we experienced in a generation—by some measures, the deepest since the Great Depression of the 1930s. In terms of economic policy, however, we have regressed to the early 1970s, before the last “great recession” of 1974-82, when Richard Nixon infamously said “we are all Keynesians now.” Today’s policy debate has been dominated by ideas that were tried, and found wanting, during the 1970s. The policy responses to date have consisted of two sets of actions. One is increased federal spending and “targeted” tax breaks, based on the theory of a “multiplier” effect that will result in each dollar spent and each dollar of tax relief being respent several times. The second is unnaturally low interest rates. This combination of policies failed to generate economic growth a generation ago but is being tried again on a far grander scale today. Why has this happened?”

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