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Saturday, May 12, 2007


Stormwater bills are public, after all

I have paid my storm water bill. Is it a tax? Well, I'm not sure. Many think it is and if it turns out it is, then we should vote on it. The city says no, but this article tells how a lien can be put on your house if the bill is not paid. Now, when I received my bill, I was suspicious. Here I am, paying my property taxes, when I get a bill out of nowhere. The bill says that if I do not pay the bill, the city will put a lien on my house. So, using the knowledge I did in class, I analyze the bill.

If I enter into a contract with a lender, such as my mortgage company, then they can use government's coercive force to enforce the contract. But what contract did I enter into with the city concerning storm water runoff? This is a classic case of governments coercive power. I agree with those who see this as a tax. In Colorado, we have to vote on new taxes- we didn't vote.

My next question is why didn't we vote on it. The city says it doesn't have the money to do the projects concerning storm water and runoff. My first question is why? Is this a new problem that has surfaced? Why hasn't the city been planing for this for years, why such the urgency. The answer, I believe, is the city does not know how to budget. Can the city really tell us this came as a surprise?

The city has not taken into account if there is any actual runoff form the property to the city drains. There is no mention in the bill I received to contest if I were saving any run off of rain. And another thing, what if there is a drought and there is no run off, then what are we being charged for. Probably the reason it was not introduced as a tax might be because there is not a efficient amount of run off. If this goes to the Colorado Supreme Court (if challenged), I would hope that they have a corrective state of mind in deciding the case.

I also think this issue will coincide with the issue before the state right now concerning the new education bill- many think it is a new tax, supporters (like the storm water bill) disagree. I suppose the courts will decide.

Wednesday, May 09, 2007


Burrowing increases. fed out of touch?

And article on Yahoo recently posted that comsumer borrowing in the month of march rose at an annual rate of 6.7 percent. this shows good growth after a slight slump in the first quarter this year.

This sounds to me like the fed is out of touch, after a year of holding the target rate constant, they recently announced that they are continuing to hold the target rate constant. This seems out of touch with the economy.

The article in Yahoo claimed that the high consumer borrowing is remarkable, due to high prices and rates. For this reason and the fact that the first quarter had been week, (growth around 1.3 percent) the fed should have been lowering the rate. It would have helped last quarter and strengthened the consumer spending that had been strong in march, making it potentially even stronger.


Senate Panel approves higher required feul economy

The nationwide fleet fuel economy required for cars and truck has been increased by the Senate Commerce Science and transporation rom 25 to 35 miles per gallon.

"This is not a perfect bill, but I think we have reached a stage where most parties would say this is fair," said Sen. Daniel Inouye. My problem with this is that if "most parties" involved would be ok with this, and I am assuming that "most parties" he means businesses and firms who are in the transportation industry. If this is true and if businesses could easily comply with these standards then competition would have already induced them to have done this already.

If this bill is to improve the industry, then it is just a regulation that will do more harm than good, reducing the number of cars that can be sold, since, now we have both fuel efficient and non- fuel efficient cars in the market. The higher requirments won't dramatically increase the number of efficient cars, just dramatically reduce the number of innefficient cars.

The only way this bill would work is if it is INTENDED to reduce the number of cars one the road. this however does not seem to be what the bill's intended consequence is. It seems like they are trying to turn the innefficient cars being produced, into efficient ones, but if all cars could be efficient already, then they already would be.

Thursday, May 03, 2007


Imus suing CBS

As many of us may remember Don Imus was somewhat recently fired for his comments about the Rutgers basketball team. Well now Don Imus is suing CBS for 40 million dollars which was the amount of his contract that he was left unpaid due to him being fired. Imus and his lawyer are filing a breach of contract, citing a specific part of his contract, "Imus' services were "unique, extraordinary, irreverent, intellectual, topical, controversial." Now I must make clear that I do not agree with what Imus did but the 1st amendment does guarantee freedom of speech and even if what he says does offend others, this was acknowledged in his contract. So again, although I do not agree with what Imus has done, after looking at his contract and the 1st amendment I would side with Imus in a court case and would award him his 40 million.

On a side note. Personally I think contriversial topics are the best to discuss and need to be addresed and I beleive that everybody is offended by something and as long as you market your talk to show to be offensive you should be able to discuss these topics. Look at the howard stern show, he was donig all sorts of crazy things, but that was expected becasuse it was the howard stern show. Personally I would not have fired Imus.

Tuesday, May 01, 2007


Senate Discusses Overhauling PDUFA Act; Disincentive to Investment.

The Senate has been recently debating the possibility of overhauling the FDA. It would do this by amending and extending the Prescription Drug User Fee Act created in 1992. The Act was originally created to defray the costs the FDA incurred while reviewing prescription drugs. The FDA's proposal to Congress would have the drug industry pay $393 million in annual fees (Bridges, Associated Press). This spending would go to new drug and food safety measures. It would include provisions to ensure the safety of child drugs and devices as well as the safety and effectiveness of drugs currently on the market. The renewal of the Act also promises to make the approval process of drugs more quick and predictable. The provisions set forward however, do not allow for the importation of drugs nor generic drug approvals (all facts, from attached link, Andrew Bridges, the Associated Press).

This is sort of a grey area of market failure. There is market failure, but it may protect consumers to an extent. It creates a barrier to entry through government licensing, therefore violating perfect competition. It also violates the PC model by heterogeneous products and asymmetrical information. Generic drug companies and foreign companies have been left out of the new provisions so far. This renewal and amendment to the PDUFA Act was brought to the Senate by the FDA itself. There may be rent seeking on the part of the FDA and possibly the large drug corporations. The FDA can not act efficiently, so it seeks legislative coercion for additional aid. The larger drug corporations may not necessarily be too adversely affected by the increased costs, but may benefit from reduced competition. Although the Act promises to cut costs the FDA incurs by reviewing drugs, the Act is still economically inefficient. It seems to limit competition in the prescription drug market. It also promises to make the approval process faster by introducing more legislation into the drug industry.

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