Here are some good think-tank reads for your Hump Day.
• The Heritage Foundation’s Jack Spencer is wondering why the new energy bill from Ed Markey and Henry Waxman contains virtually no mention of nuclear power. Well, okay, Spencer is not so much wondering as he is withering in his criticism:
While the bureaucratic-laden approach offered by the legislation is extremely problematic, the fact that it has virtually no mention of nuclear power calls the entire green initiative into question. If reducing carbon dioxide and other emissions, creating jobs, and promoting domestic energy sources were truly the objective, then nuclear energy should be central to the legislation.
Nuclear power already provides the United States with 20 percent of its electricity and 73 percent of its CO2-free electricity. When it comes to affordable near-term reduction of CO2 and other atmospheric emissions, the importance of nuclear power cannot be overstated.
• Michael Greve of the American Enterprise Institute has written a thoughtful new paper on the issue of federal preemption. While devolving more power to states and localities to operate (and fund) public services would be a good thing, subjecting multistate enterprises to dozens of separate and often capricious regulatory schemes is neither good nor truly conservative. Greve argues that the U.S. Supreme Court has recently weakened the preemption doctrine in a decision involving a medical provider’s improper use of a drug made by Wyeth:
Wyeth arose over a tragic injury to a patient whose doctor and nurse, in an act of flagrant malpractice, had administered a drug in direct contravention of the federally approved warning label. The wording of that label conformed with–in fact, was practically dictated by — FDA requirements. This should have sufficed to shield the drug company from liability in state courts in cases of misuse; in legalese, the federal law — in this case, the Food, Drug, and Cosmetic Act (FDCA) — should “preempt” the imposition of state-law liability. But by a six-to-three majority, the court decided against preemption. (Justice Samuel Alito dissented, joined by Chief Justice John Roberts and Justice Antonin Scalia.) The adequacy of drug labels will henceforth be determined not by FDA experts but by random juries with massive hindsight bias.
The effects of this ruling reach far beyond the pharmaceutical industry. Federal preemption is the only available defense for virtually any industry against rapacious tort lawyers and ambitious state attorneys general. Without it, a manufacturer will potentially be subject to fifty-odd different sets of rules within the United States, all of them subject to change at the whim of juries and judges. The risk of confusion and balkanization is compounded by a relentless proregulatory bias: in integrated product markets, producers must of necessity comply with the law of the most restrictive state.
• Writing in The Economist, Chris Edwards of the Cato Institute analyzes both the economics and the politics of using the tax code to further punish the nation’s most-productive entrepreneurs and professionals, making an interesting argument about the source of public anger:
In America, it is not rich and productive people that create resentment. Instead, it is corrupt politicians handing out special favours, it is the bungling bureaucrats we saw after Hurricane Katrina, and it is cabinet nominees who cheat on their taxes. Americans are not upset at wealthy Steve Jobs and his amazing innovations, but they are upset when they hear that global warming advocate Al Gore lives in a mansion that consumes 15 times more electricity than the average US home. It is hypocrisy, fraud and corruption that people do not like, not hard work and high incomes.