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John Galt Is Everywhere and His Killing Spree Continues

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On Thursday, I wrote about the central role that absolute free market libertarianism, as personified by the fictional John Galt, played in the horrific explosion in West, Texas that took the lives of fourteen people, most of whom were volunteer firefighters fighting a fire at an unregulated fertilizer facility. We have now learned that the facility had a checkered history of ignoring regulations and had 1350 times more ammonium nitrate on hand than the amount that triggers a legal requirement to report the facility to Department of Homeland Security. Of course, the facility’s owner chose to ignore that regulation along with the many other regulations he chose to ignore. Sadly, some press accounts of the owner chose to focus more on his role as a church elder (Update: he was even at Bible study when the fire broke out!) than on how his choice to flout regulations and good sense led directly to this tragedy. Whatever the cause of the original fire that eventually triggered the explosion, the plant owner’s decision to maintain such a large and unreported amount of highly explosive ammonium nitrate so close to so many people played a huge role in how this tragedy played out.

Those deaths, and their roots in blatant disregard for government regulation in the belief that it harms business, are sadly just a small part of the larger picture of how free marketeers have corrupted the public marketplace of ideas to sow widespread death and destruction so that the “job creators” can go about their usual business of pocketing massive profits while refusing to make microscopic investments in small steps that would save many lives.

Remember the other, larger Massachusetts tragedy that killed at least 50 and injured 722? No?  It was discovered last fall that New England Compounding Center in Framingham, Massachusetts had been flaunting the rules on drug manufacturing and in their haste to reap maximum profits shipped out vials of steroids contaminated with fungus. Thousands of patients around the country were injected with contaminated material and deaths and injuries followed.

You would think that since this tragedy played out last fall, the government would have realized the error of letting companies call themselves compounders when they are in reality manufacturing drugs on a large scale. Drug manufacturers are subject rigid FDA standards while compounders are regulated as if they are simple neighborhood pharmacies where the druggist might mix single vials of drugs into a form a local doctor has requested for individualized treatment of a patient. But no, because of massive lobbying on the part of compounders, who have become a huge presence because of the vast sums of money they can earn by working the margins of regulation, lawmakers pocket the proceeds of the lobbying and proclaim themselves powerless to harm the job creators as they bring these products to market. It should be viewed as no surprise then, that a different compounder, this time in Florida, now is recalling all of its products because it has been found to have been shipping product that was contaminated with bacteria. It is not yet known if any patients have been harmed by products from this compounder, but at least today’s article on the recall was able to update the death toll from the Massachusetts compounder to 53.

The Boston Marathon bombing and the subsequent search for the perpetrators also was touched by John Galt. Technology has existed for nearly 20 years that can make individual production lots of explosives traceable. But when it came time to implement the technology, the NRA and other gun enthusiasts managed to limit the inclusion of taggants to plastic explosives and to specifically exempt black powder (otherwise known as gunpowder) from being required to be traceable. The Boston bombs used black powder. If investigators had been able to know within hours of the blast where and when the black powder was purchased, would they have been able to arrest the bombers sooner and without the subsequent death of one police officer and near death of another? The full shutdown of Boston on Friday would not have happened if the brothers had been arrested Wednesday or Thursday through tracing the black powder they purchased. But no, John Galt said that gunpowder manufacturers shouldn’t have to spend the extra pennies to tag production lots and the inclusion of taggants in gunpowder infringes the rights of gun owners in a de facto registration of their ammunition, so society has to suffer the consequences of this freedom.

Oh and all that gun freedom. It appears that we have five more gun freedom victims in Seattle today.

John Galt is a very busy guy, sowing death and destruction from one side of the country to the other. But since he continues to make good money, we have to give him his freedom and keep those markets wide open. Praise the lord of the free market and pass the untagged ammunition.

“Cozy Ties Between Regulators, Politicians and Utilities” Gives New Nuke Agency in Japan, Business as Usual on Wall Street

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Reuters reports this morning that Japan’s lower house of parliament has passed a law authorizing creation of a new nuclear regulatory agency. The second paragraph of the story stands out to me:

The 2011 Fukushima disaster cast a harsh spotlight on the cozy ties between regulators, politicians and utilities – known as Japan’s “nuclear village” – that experts say were a major factor in the failure to avert the crisis triggered when a huge earthquake and tsunami devastated the plant, causing meltdowns.

The underlying cause of the “nuclear village” where regulators are captured by the industry they regulate and the politicians also are owned by the same system applies equally as well to the situation that enabled the meltdown of global financial markets in 2008. There is far less recognition of the village aspect of Wall Street’s lack of regulation in the financial crisis, and where there have been moves ostensibly toward regulation or even prosecution of crimes, they have been a sham:

On March 9 — 45 days after the speech and 30 days after the announcement — we met with Schneiderman in New York City and asked him for an update. He had just returned from Washington, where he had been personally looking for office space. As of that date, he had no office, no phones, no staff and no executive director. None of the 55 staff members promised by Holder had materialized. On April 2, we bumped into Schneiderman on a train leaving Washington for New York and learned that the situation was the same.

Tuesday, calls to the Justice Department’s switchboard requesting to be connected with the working group produced the answer, “I really don’t know where to send you.” After being transferred to the attorney general’s office and asking for a phone number for the working group, the answer was, “I’m not aware of one.”

The promises of the President have led to little or no concrete action.

In fact, the new Residential Mortgage-Backed Securities Working Group was the sixth such entity formed since the start of the financial crisis in 2009. The grand total of staff working for all of the previous five groups was one, according to a surprised Schneiderman. In Washington, where staffs grow like cherry blossoms, this is a remarkable occurrence.

We are led to conclude that Donovan was right. The settlement and working group — taken together — were a coup: a public relations coup for the White House and the banks. The media hailed the resolution for a few days and then turned their attention to other topics and controversies.

But for 12 million American homeowners, collectively $700 billion under water, this was just another in a long series of sham transactions.

Perhaps in homage to the Schneiderman and other sham units, the Reuters article on Japan’s new agency does show a bit of caution regarding the new agency:

The legislation, however, swiftly came under fire for appearing to weaken the government’s commitment to decommissioning reactors after 40 years in operation, even as it drafts an energy program to reduce nuclear power’s role.

Under a deal ending months of bickering by ruling and opposition parties, the new regulatory commission could revise a rule limiting the life of reactors to 40 years in principle.

“Does this reflect the sentiment of the citizens, who are seeking an exit from nuclear power?” queried an editorial in the Tokyo Shimbun daily. “Won’t it instead make what was supposed to be a rare exception par for the course?”

And as for the coziness between politicians in the US and the financial industry, we need look no further than Wednesday’s appearance by Jamie Dimon before the Senate Banking, Housing and Urban Affairs Committee. One of Marcy’s tweets during the hearing says all we need to know about that “hearing”:

BOB CORKER WIPE THAT SPOOGE FROM YOUR CHIN RIGHT NOW!

Japan’s response to its meltdown has been to shut down all nuclear plants while the framework for how they will operate if they are allowed to restart is debated. Imagine how much better off the world would be if JP Morgan Chase and Goldman Sachs had been shut down while a proper regulatory framework for them was developed.