The Pin Factory Blog

California is at it again. This time it is trying to ban trans fat from all restaurants in the state. Forget that these restaurants are privately owned. Forget that costumers buy and eat food of their own free will and volition. Forget that doing so carries no externalities that would endanger the health of those who do not eat trans fats. The nanny is saying no.

As Assemblyman Chuck DeVore said, "For gosh sakes, this is taking government power to an absurd extreme."

For gosh sakes, is true. Many restaurants now voluntarily use trans fat free substitutes because consumers are increasingly aware of products that cause obesity and heart disease. But some restaurants cannot use substitutes without compromising the quality of their food. According to the California Restaurant Association:

Ethnic-food restaurants could be hit particularly hard by a ban on trans fats, because some of their entrees are difficult to prepare with substitutes... The particular oil used in a food affects product taste, appearance, texture, performance and stability.

Let restaurants and consumers decide. Children have mothers, and adults generally have enough brain capacity to decide what kind of food to eat.

The legislature approved the bill, which is now awaiting the Governator's approval or veto. For freedom's sake, let us hope Arnold Schwarzenegger terminates it.
 

Governor Jon Huntsman Jr. of Utah is bringing radical change to his state next month. Currently state employees work eight hours a day, five days a week. Starting in August, they will work ten hours a day, four days a week. The idea is to help employees save on gas and to reduce the state’s energy bills. By closing hundreds of buildings for an extra day of the week, the state will save $3 million a year.

Unfortunately, when politicians try to solve problems they usually make them worse. But this idea shows a keen understanding of supply and demand. Tariffs, taxes, minimum wages, and price controls distort markets because they work against supply and demand. But a four-hour workweek will help 16,000 state employees.

Further, the money workers save will be spent in other sectors of the market and the $3m the state saves can be invested in infrastructure, schools, or given back as tax breaks. In March, Utah was named the best-managed state in America and last year it had the most economic growth and it continues to perform well even as the economy slows.

Creativity, intelligence, and an understanding of economics. Imagine the possibilities.

The Conservative Party plans to harden the line for welfare recipients if it wins the next election by requiring any able-bodied person on welfare who is under 21 and unemployed for three months to attend an intense work-training program. It is hoped that the proposed course would improve their work discipline and teach the skills necessary to obtain work.

Even better, they plan to "ask private sector companies and voluntary organisations to run the… centres." But what if they still don’t find a job? After a year of unemployment, they’ll be required to work full-time in community programme.

This proposal should increase productivity and decrease government spending on a deadweight program. By using private companies and charities, the worker-incentive program has a much better chance of being both effective and efficient.

As the party’s welfare spokesman Chris Grayling said, "Staying at home doing nothing will be a thing of the past."

It all fits in nicely with our line on welfare reform, which you can read more about in our 2007 report, Working Welfare.
 

This week’s Economist warns that America could have the infrastructure of a third world country within a few decades if does not change course quickly.

Thomas Friedman wrote in the New York Times that America, more than Iraq or Afghanistan, is in need of a better-functioning democracy that can work to solve the big issues.

Each year, the federal government collects 2 TRILLION dollars in taxes. State and local taxes push the total amount of taxes collected even higher. Sadly, while infrastructure crumbles and the economy goes to the pits, the government wastes billions of dollars on useless projects and subsidies—and spends far more than the two trillion it takes in.

This situation is not wholly unique to America. The UK sends a ridiculous amount to the EU each year and gets little in return. Meanwhile, consumer confidence is at a 26 year low and housing prices have fallen for the ninth consecutive month.

What should the government do? 1) Focus spending where it is absolutely necessary. 2) Eliminate wasteful spending. 3) Get rid of useless subsidies and entitlements. 4) Get rid of protectionist regulations and tariffs. 4) Lower taxes.

A new government report claims Britons are wasting more than £1 billion a year, and the Cabinet Office inquiry into food policy says the average family wastes £420 worth of food each year. All these numbers have prompted Gordon Brown to ask Britons to stop wasting food.

The numbers, however, don’t quite add up. The UK has 60 million people—meaning the average waste per person is less than £20. If the average family size is 21 people, then it is true that each family wastes £420 each year. If not...

Anyway, encouraging Britons to reduce the amount of wasted food is Brown’s latest brilliant idea:

“If we are to get food prices down, we must do more to deal with unnecessary demands, such as by all of us doing more to reduce our food waste," he said.

Yeah, and we can reduce greenhouse gasses enough to save the planet by switching our light bulbs. Enough has already been said about agriculture that anymore simply feels redundant. But what do governments really expect when they subsidize bio-fuel production so heavily, and subsidize food production but then pay the same farmers to leave some plots of land empty to prevent overproduction?

I spent a lovely evening at the Waterstone's bookstore in Picadilly last night and enjoyed perusing Mr Jones' Rules for the Modern Man by Dylan Jones. As I read the table of contents, I noticed a chapter entitled "How to Fire Someone." Jones then outlined what he claimed was the complicated procedure of giving warnings--both written and verbal--and of notifying HR, recording bad behaviour, and keeping witnesses.

Little does he know how good he has it. According to a Times article:

Talking to one headmaster at a London school last week, he told me that his hands were tied. Getting rid of a poor teacher, he explained, was nigh on impossible. Even though parents had complained about one of his own members of his staff, he had done little because the process was long and arduous, created dischord in the school, and might not even work.

An anecdote from my own lovely education. My history teacher when I was 16 did nothing more than make us read our textbook. She never lectured, never taught--just told us to read. If someone spoke, she yelled. Our principal wanted to fire her, but was scared she would sue. After several years of poor performance, she assaulted a student. Finally the axe fell.

It should not be this hard! Are the students for the teacher or the teacher for the students? I love and respect the thousands upon thousands of truly excellent teachers. There is hardly a more dedicated and altruistic bunch. But making it difficult to fire protects teachers at the expense of children.

As things are, if children get stuck with the poor teacher, they just have to accept it.
 

Good news for those who support ethanol production as a means to reduce greenhouse gasses. You can get a beautiful mahogany table and chairs set, made from rainforest land converted to farmland to grow crops for ethanol.

According to Time Magazine, ethanol production isn’t just raising food prices:

An explosion in demand for farm-grown fuels has raised global crop prices to record highs, which is spurring a dramatic expansion of Brazilian agriculture, which is invading the Amazon at an increasingly alarming rate.

Worse yet, ethanol is increasing food prices, which in turn has significantly increased the demand for soybeans. Hmmm… where could soybeans grow? Northern Brazil. On land formerly known as the Amazon. Remember the 1980s and 1990s when saving the rainforest was all you talked about in science class? The last great environmental cause is being destroyed by the current one. In fact: “Bio-fuels now look less green than oil-derived gasoline."

So please, Congress, Parliament, EU, Gordon, George: just stop. Like always, your mandates, regulations, and subsidies are doing the reverse of their supposed intentions.

The Times reports today that the EU may suspend subsidies to farmers that don’t go green. Various bureaucracies hope subsidies will solve overproduction, the impact of farming on flowers and bird habitats, worldwide food shortage, watercourses, and the use of pesticides. Here’s a better idea: don’t stop there!

The good news, however, is that the European Commission will no longer pay farmers to leave 8% of their fields empty. But that leaves the question: What Einstein had the idea to pay farmers for production, and then to avoid the overproduction caused in part by subsidies themselves, pay them even more to leave part of their fields empty?

I had a flatmate once who tried the same techniques to woo various women over the course of several months, but to no avail. After being rejected dozens of times, he said, “I guess if I try the same things over and over and get the same result, I should try something else."

Touché. How many times will our governments try the same old things and expect different results? Supply. Demand. Prices. Free markets. Same old things that always result in economic growth. Subsidies, government planning, market manipulation, and regulation? Take a wild guess…

Cristiano Ronaldo is under fire for claiming he is like a slave because Manchester United will not release the final year of his contract so he can play at Real Madrid. We should all mourn this blatant violation of human rights.

Poor Ronaldo. In 2004, Man U exploited a helpless and innocent teenager, and then tricked him into signing a new contract in 2006 for £56 million 2010. When he said, "United have stood by me and been there for me and I want to repay that," it was probably against his will. Those monsters at Man U made him say it. In April 2007, he renegotiated his contract through 2012 for £120,000 per week and said, "I am very happy at the club and I want to win trophies and hopefully we will do that this season."

Those guys in Manchester United can manipulate anyone to say anything. It’s ludicrous to believe anyone could possibly be happy playing football for a living—especially for such little money. It won’t be long until the bosses at Man U realize their errors and write the greatest hymn of anguish and repentance since “Amazing Grace" and Ronaldo releases his album of freedom songs.

For someone named after the Great Ronald Reagan, Ronaldo should realize that this is actually called CAPITALISM, not slavery. Two people negotiate, agree on the terms of a contract, and sign it. Then both parties do what they agreed. In this case Man U agreed to pay Ronaldo a ridiculous amount of money and Ronaldo agreed to play football for 5 years. A little different than being transported from Africa to South Carolina in the barracks of a terrible ship, being sold from one owner to the other, and performing forced labour your whole life…

The United Kingdom and the United States are both affected by and concerned about the war in Iraq, the credit crises, the housing market, oil prices, globalisation, immigration, and a host of other challenging situations.

Notice some similarities in recent events:

US: A Democrat won one of the safest Republican seats in the House of Representatives last week.

UK: Last week, the Conservatives thumped Labour in the Crewe and Nantwich by-election.

US: “The Republicans [are] busy dying. The brightest of them see no immediate light. They're frozen, not like a deer in the headlights but a deer in the darkness, his ears stiff at the sound. Crunch. Twig. Hunting party." - Peggy Noonan, former Reagan speechwriter, Wall Street Journal columnist, and influential Republican

UK: “The lesson tonight for the Labour Party is that it is change or bust." - John McDonell

US: “[I’ll]… build a coalition for change that stretches through red states and blue states because that's how we'll win in November, and that's how we'll finally meet the challenges that we face as a nation." - Barack Obama

UK: “I want to go on building this broad coalition for change so we can bring our country better government." - David Cameron

I guess it's the political cycle at work!