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Tag Archives: regulation

Why Small Government Reduces Income Inequality (And big government increases it)

Sadly this is counter intuitive in today’s American society. We have been told since childhood that government “evens things out” and helps reduce income inequality. We were all regaled with stories of the Great Depression, where big government’s patron saint FDR bestowed “relief” to those stricken by the downturn of the 1930s. We were too young to understand that these myths were being propagated by people who benefited from an expanded government, namely the teachers (unions). We were also too young to understand that government actually extended the Great Depression for reasons we won’t go into here. We have been told our entire lives that government makes things more fair.

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Lawmakers move to outlaw use of welfare benefit cards in marijuana shops

I am all for the liberalization of marijuana laws, as I have written many times before. The prohibition of cannabis is simply wrong in my estimation for a number of reasons, not the least of which is that it is a crony capitalist construct. For years millions (really billions) have been made off of keeping weed illegal. From prison unions to Big Pharma lots of interests wanted to keep the inexpensive, relatively innocuous drug in the illegal category. I think legalization of pot is a good thing.

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“Too Big To Fail” designation of banks makes economic disaster more likely

The big banks, which in 2008 nearly went belly-up because they were overleveraged and needed a taxpayer funded bailout in order to survive a reversal in the economic tide, are even bigger today. They pose more risk than they did 5 years ago. Because they have been designated as “too big to fail” the megabanks now enjoy an implicit subsidy courtesy of you and me. Their borrowing costs are lower because we backstop them. Because of the backstop and lower costs bankers are incentivized to take on more risk. Sooner or later this will create major instability as the market mechanism has been distorted and will seek to correct for this distortion.

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