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Sweet Briar Shuts Down

March 3, 2015 at 2:03 pm

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Amid the talk of a higher education bubble, it's worth remembering that not every institution makes it. Sweet Briar College in Virginia announced today that this year's graduating class will be its last. "Efforts will begin immediately to help current students transfer to other colleges and universities," the college said.

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Summers on Taxation

March 3, 2015 at 1:40 pm

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Former Harvard president and Treasury secretary Lawrence Summers has an interview with the Washington Post in which he calls for action to fight inequality:

insofar as the goal is to address inequality, I think we will need a combination of more substantially more progressive taxation than we have at present in the United States...There is, for example, no reason why the estate tax should be so riddled with loopholes and sheltering devices, as is currently the case. We need to look at places where there are substantial economic rents being earned, whether those are property values protected by exclusionary zoning, franchises contributing to the politically fortunate, overly generous protections of intellectual property, or implicit subsidies to the financial system, as examples.

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Buffett's Letter

March 3, 2015 at 12:03 pm

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Warren Buffett's annual letter to Berkshire Hathaway shareholders is the topic of my column this week. Please check it out at the New York Sun (here), Reason (here), and Newsmax (here).

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The Odious New Yorker

February 27, 2015 at 11:54 am

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No sooner had I posted my column from this week about the New Yorker magazine's political tilt than the magazine confirmed it with a piece that begins, "let's stipulate up front that Scott Walker, the governor of Wisconsin, is an odious politician whose ascension to the Presidency would be a disaster." The article decries Governor Walker's "hat tip to the Book of Genesis brigade," as if the New Yorker would prefer the Bible without the first book.

These sort of "up front' stipulations were what I meant when I wrote about the way the magazine seems to assume its readers share a certain political view, and how annoying that is for those of us readers who don't share it.

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Preet's Fire-Ax

February 27, 2015 at 8:38 am

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From the press release announcing David Ganek's Fifth- and Fourth-Amendment-based lawsuit against the U.S. attorney for the Southern District of New York, Preet Bharara, in connection with raid that the release calls "one of the only instances ever when FBI agents have raided a financial services organization without simultaneously making arrests or filing charges. That raid directly and predictably led to the closing of Level Global and cost nearly 60 innocent people their jobs and reputations"...

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Good for Ganek

February 26, 2015 at 10:26 pm

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Money manger David Ganek has sued the U.S. attorney for the Southern District of New York, Preet Bharara, "claiming that the government violated his constitutional rights by fabricating accusations against him," the New York Times reports, adding that "Mr. Bharara's image as an invincible prosecutor...is beginning to fray." Let's hope so. And good for Mr. Ganek and his legal team for pushing back and giving Mr. Bharara at least a modest sense of what it is like to be on the other end of things.

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The New Yorker's Demented Attack on Reagan

February 24, 2015 at 8:49 am

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The 90th anniversary issue of the New Yorker magazine, which included an article about commas and a profile of Apple executive Jonathan Ive, is the subject of my column this week. Please check it out at the New York Sun (here), Reason (here), and Newsmax (here).

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Laugh Line of the Day

February 23, 2015 at 10:54 am

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From a New Republic critique of Patricia Arquette's Oscar speech: "addressing people as taxpayers is a rather unsavory (and typically right wing) habit that advances the notion people are worth what they pay in taxes."

It's a good thing no one ever told Samuel Adams that or we American taxpayers would still be stuck supporting the British royal family in their palaces.

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Preet Parties

February 23, 2015 at 10:40 am

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For the second year in a row, the U.S. Attorney for the Southern DIstrict of New York, Preet Bharara, attended the Vanity Fair Oscars party. (The New York Post has the 2015 news; the New York Times reported the 2014 news.) In 2014, Mr. Bharara had explained his attendance by saying that an Oscar-nominated movie was based on one of his office's cases. I've seen no explanation yet for this year's appearance. It certainly makes it possible for people to interpret Mr. Bharara's prosecutorial zeal against so-called insider traders as somehow associated with the political opinions of the Vanity Fair editor, Graydon Carter, who wrote, "the disconnect between the country's richest and its most downtrodden is looking very much the way it did during the first Gilded Age, in the late 1800s...Like grubs, slugs, and moles, Goldman prefers to work in the dark."

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Obama's Credibility Gap

February 23, 2015 at 10:18 am

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Foreign policy isn't our usual concentration here, but this scathing column by the editor of the Washington Post editorial page, Fred Hiatt, is worth making an exception:

By most measures, though, the world has not become safer during Obama's tenure. Islamist extremists are stronger than ever; democracy is in retreat around the globe...allies are questioning U.S. steadfastness.

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Fannie Mae and Property Rights

February 23, 2015 at 12:33 am

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John Carney reports in the Wall Street Journal's "Heard on the Street" column:

Fannie Mae isn't the immensely profitable company some of its biggest investors hoped it would be.
Despite a sizable increase in the fees Fannie charges for its mortgage guarantees, the company on Friday reported fourth-quarter net income of $1.3 billion, down 80% from a year earlier. Revenue fell 21% to $5.5 billion...

the results severely undercut the argument that a 2012 change to the company's bailout, which allows the government to sweep substantially all of Fannie's profits, amounts to an illegal expropriation. In fact, Fannie's quarterly payout to the Treasury would have been about $1 billion higher under the bailout's original terms. And to date, the internal rate of return to the Treasury on the bailout of Fannie is an unimpressive 5.6%.

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The End of Snow

February 16, 2015 at 9:17 pm

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It's been the snowiest month on record here in Boston, which for me was a chance to curl up in front of the computer and re-read some of the climate-change coverage in the New York Times, which is almost as funny, in a dark way, as the 40th anniversary program of "Saturday Night Live." This is the topic of my column this week; please check it out at the New York Sun (here) and Reason (here).

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Fannie, Freddie, and Privilege

February 15, 2015 at 10:11 pm

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Gretchen Morgenson has a pretty good column in Sunday's Times about how the government is asserting presidential privilege to try to keep secret the records of its deliberations over seizing the profits of Fannie Mae and Freddie Mac:

In a Jan. 28 letter to investors, Bruce Berkowitz, Fairholme's managing member, questioned the broad sweep of the government's claims to secrecy.

"Why are F.H.F.A. and, particularly, Treasury resisting discovery so fiercely?" he wrote. "Is it because the document trail directly implicates some of the president's most senior advisers in the White House?"

Fairholme officials and their lawyers declined to comment further about the case.

The question that Mr. Berkowitz raised is more than fair...

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Amazon Competitor Jet

February 11, 2015 at 9:40 pm

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The Authors Guild (of which I used to be a member until President Obama effectively shut down its ability to offer health insurance to authors) and the group Authors United have been pressing the Justice Department to take antitrust action against Amazon.com. Now it looks like there's a possibility that Amazon may face some additional competition in the free market, without any government action.

Jet.com, a site that plans to compete with Amazon in the online shopping space, has raised a reported $220 million pre-launch for its site, which is promising the lowest prices on the web to shoppers who pay a $50 annual membership fee. The idea, the founder told Re/Code, is to do to Amazon what Costco did to Walmart.

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Bribery at the Buildings Dept. — Again

February 11, 2015 at 11:38 am

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The New York Times reports:

More than a dozen New York City buildings inspectors and clerks have been charged with exploiting their positions as gateways to the city's booming real estate industry to obtain hundreds of thousands of dollars in bribes, law enforcement officials announced on Tuesday.

This seems to be a recurring problem, and is a wonderful (or horrible, depending on how you look at it) example of the rule that it is the regulation that creates the opportunity for the corruption. One reason to be for smaller government is that it would be more honest, because there would be fewer opportunities for shakedowns.

Some background on past problems:

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