Federal 
8 May 2008
Gas Tax Holidays, Part 3:
Do economists' predictions make economic sense?
by Richard Belzer
in Regulatory Economics
It has been widely reported that over 200 recognized economists, spanning the political spectrum, have signed an open letter opposing the federal gas tax holiday proposed by Sens. John McCain (R-AZ) and Hillary Clinton (D-NY). Despite the ubiquitousness of reporting about the letter, we've been unable to locate an authoritative copy of it. Still, what we have have found raises questions about the economists' economic reasoning. More...
Gas Tax Holidays, Part 2:
The value of symbolic benefits
by Richard Belzer
in Regulatory Economics
Economists often complain that they are ignored when they make policy recommendations, or recommend against policies they believe are ineffective, inefficient, or counterproductive. A large number of economists have signed a joint letter objecting to the gas tax holiday proposed by Sens. John McCain (R-AZ) and Hillary Clinton (D-NY).
Clinton has responded saying "I'm not going to put my lot in with economists." This remark appears to have been widely interpreted as a dismissal of the economics profession with respect to its area of specific expertise. An alternative interpretation is that she believes economists have little or no expertise with respect to politics, and the value of a gas tax holiday is political, not economic.
Today, economist Bryan Caplan of George Mason University writes in support of a gas tax holiday because of these symbolic benefits. More...
2 May 2008
Gas Tax Holidays...
...and how they conflict with the candidates' energy policy proposals
by Richard Belzer
in Regulatory Economics
Recently, Sens. John McCain (R-AZ) and Hillary Clinton (D-NY) have proposed a "gas tax holiday" in which the federal government would suspend its collection of motor fuel taxes during the summer vacation travel season. Sen. Barack Obama (D-IL) has opposed it because it would provide minimal relief.
The proposed gas tax holiday is an odd idea to dominate an energy policy debate. All three candidates have promised to take action if elected that would dramatically and permanently increase gasoline prices. More...
23 Apr 2008
Proposed New Fuel Economy Standards:
A test for benefit-cost analysis
by Richard Belzer
in Regulatory Economics, Regulatory Policy
The Department of Transportation's National Highway Traffic Safety Administration proposed on April 22 to significantly increase the fleet average fuel economy standards motor vehicle manufacturers must meet beginning in the 2001 model year. More...
2 Apr 2008
Academic Success and the Final Four
by Richard Belzer
in Amusements
College basketball programs are not known for producing college graduates. Now that the Final Four tournaments are set, how do the competing teams perform academically? More...
1 Apr 2008
Regulating How Drop-Out Rates Are Reported:
The tip of the iceberg of a persistent information quality problem
by Richard Belzer
in Information Quality
Department of Education secretary Margaret Spellings has announced a new regulation to control how states report drop-out rates. Under existing law, the states have the discretion to devise their own formulas. This makes interstate comparisons problematic. It also reflects the states' interest in devising formulae that under-report actual drop-out rates.
Under the proposed rule, all states would have to use the same federally prescribed formula. More...
21 Mar 2008
The Revised Ozone Standard:
Simple math and simple constitutional law
by Richard Belzer
in Regulatory Science, Regulatory Policy
The Washington Post's environment reporter says EPA has weakened the national ambient air quality quality standard for ozone. Given that the standard is going down, what does she mean? More...
12 Mar 2008
The Haze of Carbon Dioxide
According to the Washington Post, anyway
by Richard Belzer
in Regulatory Science, Regulatory Economics, Regulatory Policy
The Washington Post says carbon dioxide is visible to the naked eye. More...
8 Mar 2008
Virginia's New "Voluntary Tax" on Its "Bad" Drivers, Part 4:
The backlash wins
by Richard Belzer
in Regulatory Economics, Regulatory Policy
Washington Post staff writer Tim Craig reports that the Virginia legislature is expected to repeal the law that authorized the voluntary tax on bad Virginia drivers. The action follows a Virgina Supreme Court decision issued on February 29 declaring unconstitutional the legislature's other 2006 transportation policy innovation -- the creation of unelected regional authorities with the power to levy taxes. More...
6 Mar 2008
Energy Star Compact Fluorescent Light Bulbs:
EPA's savings calculator exaggerates savings
by Richard Belzer
in Regulatory Economics
Following up on yesterday's post, we now look at compact fluorescent (CFL) light bulbs. June Fletcher of the Wall Street Journal reported that the payback period for CFLs is "about four months." She provided no source for this figure. More...
5 Mar 2008
Energy Star Appliances:
EPA's savings calculator exaggerates savings
by Richard Belzer
in Regulatory Economics
Wall Street Journal reporter June Fletcher says (link temporarily available to nonsubscribers) it's not easy being green at home because a lot of heavily-promoted household renovations and products cost more that they deliver in environmental benefits, including energy savings. "Most homeowners like the idea of going green," she writes, " -- until they get the bill.
With home sales slumping and consumers rethinking their remodeling budgets, building contractors and suppliers are dangling green upgrades. They hope that energy-efficient systems and products made from sustainably harvested materials will hook consumers concerned about global warming, pollution and natural resources.Some consumers are willing to pay for green goods and services even if they are not cost-effective. Making significant headway into the market, however, requires that they demonstrate cost-effectiveness. Fletcher says there are two examples of green products that pass this test: home appliances and comfact fluorescent (CFL) light bulbs. Citing estimates from US EPA's Energy Star web site, Fletcher says Energy Star clothes washers and refrigerators have a "relatively short payback" of 3.5 years and 3.1 years, respectively, and that CFLs "pay back their extra cost in about four months."
Yet with a few exceptions, green materials and construction cost extra, making them a hard sell. Enermodal Engineering, a Canada-based consulting firm, estimates the premium at 5% to 10%, depending on how extensively a builder uses recycled materials and water- and energy-efficient products. When Specpan, an Indianapolis research firm, surveyed builders recently for Building Products magazine, the greatest number estimated a 10% to 19% cost increase when going green.
Today we look at the claims for Energy Star appliances. More...
21 Feb 2008
How Not to Estimate Benefits:
The case of Avastin
by Richard Belzer
in Regulatory Economics, Regulatory Policy
The Wall Street Journal editorializes today against a longstanding Food and Drug Administration policy that values the benefits of drugs for terminal cancer patients solely in terms of life extension. Some visual aids may help make the issues easier to understand. More...
19 Feb 2008
The Precautionary Principle in Action:
Is taking or not taking Vytorin 'precautionary'?
by Richard Belzer
in Regulatory Science, Regulatory Policy
A recent study raised doubt about the benefits of Vytorin, a patented combination of two anti-cholesterol drugs, ezetimibe and simvastatin. Some cardiologists say the study is sufficient evidence to stop prescribing it as widely; others disagree.
The decision whether to take Vytorin or its component drugs rests with patients, but they rely heavily on the advice of their doctors? How can patients makes sense of this debate? More...
18 Feb 2008
Taxing Illegal Markets to Raise Revenue:
To plug a budget deficit, NYS Governor Spitzer proposes to tax illegal drugs
by Richard Belzer
in Regulatory Economics
New York State Governor Eliot Spitzer has proposed to plug part of an expected $4.4 billion budget deficit by enacting a tax on illegal drugs. Similar laws have been enacted elsewhere to enable law enforcement to charge drugs distributors and dealers with another form of tax evasion. (Chances are they already evade federal and state income taxes.)
Are there any conditions in which this proposal could raise significant revenue? More...
17 Feb 2008
When Does a Normal Phenomenon Equal a Crisis?
The declining ranks of nuclear forensics experts
by Richard Belzer
in Regulatory Economics
The Washington Post reports today that the ranks of experts in nuclear weapons forensics is declining, and that the situation requires immediate action by government to avoid a crisis. More...
