Posted on May 11, 2009 by Bill Dahlin
In late January 2009 State Farm Insurance in Florida announced it was entirely withdrawing from providing homeowners’ insurance in the state of Florida. The decision to withdraw from that market came roughly two weeks after the state’s “insurance commissioner” denied a request for a rate increase. The insurance company, presumably after analyzing its exposure and rate structure, determined that the liability exposure and cost of doing business in Florida was not warranted by the potential (premiums) revenue to be obtained.
Insurance commissioners and “rate structures” have been adopted in a number of jurisdictions, including, for example, California. While all of us have observed that so-called “predatory” pricing may occur in certain circumstances the overall concept and theory for doing business in the United States is the ability to set prices for your product or service. If no one wants to pay that price, they shop elsewhere. This is what has made Walmart and Rolls Royce cultural icons. When the right to set prices at what the market will pay is removed through price fixing or other regulation the incentive to remain in a business can be largely eliminated. The homeowners in Florida will, in all probability, be the single biggest “losers” as a result of a government agency decision that is purportedly justified on behalf of consumers. The repeated weather and forest fire related emergencies in Florida, Louisiana and California impact the cost of doing business. That fact cannot be escaped. Will California suffer a similar fate for homeowners’ insurance, auto insurance, commercial liability insurance? Time will tell.
Regulations frequently lead to unanticipated results. Enacting legislation without a thorough analysis of its probable impact, intended and otherwise, leads to bizarre results. Unwinding the maze of regulation can have unintended consequences. The collapse of Enron in the national economy arose, in large part, out of the deregulation of portions of a utility that as much as invited nefarious activity by persons with a criminal mindset. Price regulation, whether for Mobilehome spaces (rent control) or for services like insurance always leads to additional collateral damage.
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Posted on May 3, 2009 by Mark Alpert
We have an opening coming on the Supreme Court and President Obama repeated his campaign promise that empathywill be key to his choice of a replacement for Justice Souter. We value empathy in our personal relationships. It is part of what makes us human and anyone without empathy is very ill. But is empathy something we should highly value in a Supreme Court Justice? Do we want Supreme Court Justices deciding cases based on empathy or the law? In fact, don’t we want just the opposite–someone who will apply the law regardless of his or her personal feelings about a party? It is the role of a judge to exercise dispassionate justice, not empathize with the parties.
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Posted on April 24, 2009 by Mark Alpert
The politicization of science has scary implications for property rights. Indeed, the religion of man made global warming has practically no limit on its reach. On April 17, 2009, the Obama administration announced the EPA’s formal finding that carbon dioxide and several other greenhouse gases “endanger” public health and welfare as a landmark and long overdue step toward slowing global warming. The finding gives the EPA the authority to regulate emissions under the Clean Air Act. I’m still trying to figure out why we are planning to incur hundreds of billions of dollars in green technology costs based on a science with models that can predict rain with a 50 percent accuracy the next day. But the reach of the global warming crowd knows no limit. Researchers at the London School of Hygiene and Tropical Medicine have issued a study which concludes that obesity contributes to global warming. I have to draw a line in the sand. I am officially revoking my citizenship when the government starts regulating my intake of In-N-Out Burgers.
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Posted on July 30, 2008 by Mark Alpert
The environmental movement has been hijacked by anti-growth, anti-business and really anti-free market radicals, who oppose the very idea of individual property rights and view private business as the enemy. These causes are also hijacked by “NIMBY’s” who have no true environmental concern, but oppose a project they don’t want in their area. For them, the environmental cause of the day is just a tool. Global warming is a perfect tool for these activists because one can argue that almost any new project will result in some activity that could result in additional use of evil fossil fuels or electricity that will cause more greenhouse gas emissions.
Enter California Attorney General Jerry Brown. The Associated Press reports that Brown is suing to stop a water bottling plant, which has already been subject to extensive environmental scrutiny. Brown’s opposition is based on his contention that the environmental analysis “failed to include an examination of whether the operation will contribute to global warming through the production of plastic bottles, the operation’s electrical demands and the diesel soot and greenhouse gas emissions produced by trucks traveling to and from the plant.” Why don’t we require an environmental impact report be submitted for all the enormous resources which are wasted as a result of this kind of ridiculous litigation?
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Posted on July 3, 2008 by Mark Alpert
James Madison was a principal author of the United States Constitution. He was also a great proponent of property rights. Thus, it is particularly sad and ironic that property rights seem to have received short shrift for reasons of political expendiency. Indeed, this was a fear of Madison. I thought the Fourth of July was a good time to remind people of Madison’s wisdom on property rights and the role of government:
“Where an excess of power prevails, property of no sort is duly respected. No man is safe in his opinions, his person, his faculties, or his possessions.”
“The rights of persons, and the rights of property, are the objects, for the protection of which Government was instituted.”
“As a man is said to have a right to his property, he may be equally said to have a property in his rights.”
“In Republics, the great danger is, that the majority may not sufficiently respect the rights of the minority.”
A quote for all the Judicial Activists out their attempting to make a living Constitution—This is what the author of the Constitution thought about that:
“Do not separate text from historical background. If you do, you will have perverted and subverted the Constitution, which can only end in a distorted, bastardized form of illegitimate government.”
And as many of you set off on your summer vacations, consider this quote:
“Let me recommend the best medicine in the world: a long journey, at a mild season, through a pleasant country, in easy stages.”
Happy Fourth of July!!!
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