Ted Frank asks that salient question in regard to the New York City transit workers strike.
Or does such an action not meet Spitzer’s lofty standards?
Inquiring minds want to know.
Update: On second thought, maybe Spitzer isn’t needed, after all.
The now three year-long criminal investigation into corruption of the City of Houston administration of former Houston Mayor Lee Brown turned another page yesterday as this Southern District of Texas U.S. Attorney press release reports that federal authorities have charged Atlanta, Ga. businessman, Floyd Gary Thacker, with mail and wire fraud charges. Dan Feldstein’s Chronicle article on the indictment is here, and previous posts on the criminal probe into Brown Administration corruption are here.
The implication of the form of the charges against Mr. Thacker — a criminal information rather than a grand jury indictment — is that Thacker is cooperating with prosecutors in the probe. Thacker is accused of bribing former Brown Administration director of building services Monique McGilbra with thousands of dollars in cash and gifts in return for favorable treatment in regard to a city energy services contract. Thacker’s company designed the energy saving system for the city, but the Bill White Administration ultimately canceled Thacker’s contract in 2004 and paid Thacker liquidated damages of $202,000.
Walter Mischer, one of Houston’s best-known real estate developers and banking investors over the past generation, died yesterday at the age of 83 after a long illness. The Houston Chronicle story on Mr. Mischer’s life is here.
Mr. Mischer’s most interesting venture was his acquisition in the 1970’s of the town of Lajitas, near the Big Bend National Park on the southwest Texas border with Mexico. Mr. Mischer initially planned to develop Lajitas into a Palm Springs-type resort, but the remoteness of the location ultimately undermined that plan. Nevertheless, Lajitas over the years has developed into a unique getaway spot in one of the most beautiful areas of the nation.
2004 Nobel Laureate Edward Prescott is a Clear Thinkers favorite, and his work on Social Security reform reflects (here and here) a remarkable ability to present economic principles in a clear manner. In this Wall Street Journal ($) op-ed, Mr. Prescott criticizes playing politics with tax rates on capital gains and dividends, and — in so doing — provides this astute reasoning on the adverse economic effect of taxation:
So what are good tax rates? It’s useful to begin with consideration of a simple principle: Taxes distort behavior. From this powerful little sentence comes the key insight that should inform our thinking about setting tax rates. Any tax, even the lowest and the fairest, will cause people to consume less or work less. Taxes that are inordinately high only exacerbate this reaction, and the aggregate accumulation of these individual decisions can be devastating to an economy.
Good tax rates, then, need be high enough to generate sufficient revenues, but not so high that they choke off growth and, perversely, decrease tax revenues. This, of course, is the tricky part, and brings us to the task at hand: Should Congress extend the 15% rate on capital gains and dividends? Wrong question. Should Congress make the 15% rate permanent? Yes. (This assumes that a lower rate is politically impossible.)
For many years, the State of Alaska has been trying to persuade Exxon Mobil Corp. and BP PLC to invest with the state in a natural gas pipeline that would be built from the North Slope Oil Field to Valdez in the southern part of the state, where the companies’ natural gas would be liquefied and loaded onto tankers. But BP and Exxon Mobil prefer an alternative, longer pipeline over which they would own a larger share that would run through Canada to the Midwest. According to the companies, such a pipeline would deliver the natural gas directly to markets and be less risky than the state’s proposal. As a result of the disagreement between the state and the companies, there is currently little natural-gas production generated from the North Slope even though U.S. natural-gas prices are soaring.
So, what’s Alaska to do? Compromise and cut a deal with the owners of the natural gas? No way, not when the state can hire David Boies to come up with an implausible lawsuit against the companies (W$J article here) that plays on the public’s resentment of greedy capitalists.
Let’s see if we have Alaska’s lawsuit right. Exxon Mobil and BP, which generate less than 10% of the U.S. natural gas production, are refusing to enter into the pipeline deal that the state favors (and which might make the companies more money now, but maybe not) because the price of natural gas in the future will probably be higher than it is now. Thus, the companies prefer to “warehouse” their gas for the time being so that they can make more money in the future than they would make now.
That’s a lawsuit? Sounds as if Exxon Mobil and BP are making either a good or bad business decision to me (too early to say how it will turn out), but that should not be the basis of a lawsuit. Unless, that is, the purpose of the lawsuit is to punish those companies for having the right to make that decision in the first place.