American Elephants

It’s Not Only the Spending, It’s That the Policies Won’t Work. Part I by The Elephant's Child

I am deeply troubled by the policies of the Obama administration.  Not because I disagree with them, although I do, but because I  believe that they will not work, and that the money appropriated is completely wasted. Policies have been enacted based on ideology, because they want it.  But no one has really investigated the evidence.  They simply believe that it will work because they want it to work.

We have the recent example of the Environmental Protection Agency (EPA) wanting to regulate dust on farms.  I have always suspected that the ardent environmentalists that populate the EPA are city people, unfamiliar with the environment they want to regulate.

The EPA set up a program to make sure that any contractors who worked on a building or disturbed an area of wall larger than a few feet square, would be required to be certified for working on any home built before 1978. Participants will be trained in how to identify lead paint (commercially available kits are inaccurate between 48 and 72% of the time). Classes cost around $225 each.

Fines for non-certified work range up to $37,500 per occurrence.  In many areas, the EPA could not find people to teach the classes, but the end of the year was the deadline to get certified.  Contractors are having a hard time getting into classes. Rebecca Morley, executive director of the nonprofit National Center for Healthy Housing said contractors have had plenty of warning.  “Countless children have already suffered the consequences of lead exposure due to delays in finalizing the rule. Any delay at this point is unnecessary and will only harm children for years to come.” Thus spake the voice of a clueless non-profit Nanny.  Contractors are required to keep records of a renovation project for 3 years to prove that their work was performed according to EPA rules.  Contractors say their costs will go up by thousands of dollars.

The program known as “Property Assessed Clean Energy (PACE) is designed to promote energy efficiency in American homes involves a government loan that remains with the home, transferring to a future owner if the home is sold.  Unfortunately PACE financing is a first lien on the property.  If the home lands in foreclosure, mortgage lenders do not have first call on repayment. Unacceptable to Fannie Mae and Freddie Mac.  Federal regulations prohibit mortgages that are subordinate to other loans, so no mortgage.  Ooops!

A report released by the special inspector general for the TARP bailout program, Neil Barofsky, said Treasury didn’t show why the cuts [closing auto dealerships] were “either necessary for the sake of the companies’ economic survival or prudent for the sake of the nation’s economic recovery.  Treasury made a series of decisions that may have substantially contributed to the accelerated shuttering of thousands of small businesses.”  These decisions resulted in “potentially adding tens of thousands of workers to the already lengthy unemployment rolls — all based on a theory and without sufficient consideration of the decisions’ broader economic impact.”

Chrysler quickly closed 789 dealers, and GM promised to cut dealer ranks by 1,454 by October 2010.  Responding to protests, Congress insisted on arbitration, GM reinstated more than 660 dealers, Chrysler reinstated 80.

The Bureau of Labor Statistics , responsible for developing and implementing the collection of new data on green jobs, placed a notice in the Federal Register.  It said there is “no widely accepted standard definition of green jobs:”  they asked that readers send in definitions. The Department of Labor, at the same time had hundreds of millions to dispense for “green jobs’ and no idea what a green job actually is.  The Recovery Act contains more than $80 billion in clean energy funding to promote economic recovery and develop green energy jobs.

There a constant of policies not clearly thought through, of unintended consequences, of policy based on fantasy rather than fact, and of mathematically illiterate  consideration of costs.  Policies should be based on careful consideration to see if they will work before they are passed into law.  This has not been the case.  Policies were drummed up in haste to get the bill passed as quickly as possible with the attitude that it can be fixed later.   But when the unintended consequences result in lost jobs, raised costs that citizens can’t afford, destroyed savings and lost hope — it really isn’t amenable to casual “Oh we’ll fix it later” rhetoric.

Is it any wonder that ordinary people are heading for Tea Party rallies, and making themselves heard at town halls, and cannot wait to vote in November?


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