May 7, 2005

This Weekend’s Unanswered Questions (TWUQs for 050705)

Another installment in an irregular series of mysteries and pseudo-mysteries this inquiring mind would like to have answers for:

  • When is Big Labor going to read the Employment Retirement Income Security Act of (ERISA)? The law, originally passed in 1974 and amended dozens of times since, prohibits the expenditure of any money, time, or even attention, to political activities such as lobbying against Social Security private accounts. The Wall Street Journal noted in a Friday editorial (link requires paid subscription) that the Department of Labor reiterated ERISA’s obvious relevance to the AFL-CIO’s threats to move its participants’ money out of brokerage firms whose managements support private accounts:

    “A fiduciary may never increase a plan’s expenses, sacrifice the security of promised benefits, or reduce the return on plan assets, in order to promote its views on Social Security or any other broad policy issue,” wrote Alan Lebowitz, a deputy assistant secretary and career Labor official, in a letter to the union group.

    As noted here, “ERISA requires plan fiduciaries to discharge their duties for the ‘exclusive purpose’ of providing participants and beneficiaries with benefits.” That is, no money, time, or effort can be spent on any other matter, and participants’ money must be placed with those who the fiduciary believes will achieve the highest long-term returns, PERIOD. Any participant who believes that the actions taken recently by the AFL-CIO are sacrificing his financial well-being has standing to sue.

  • When will the naysayers acknowledge that the economy is at least performing passably? After pretty darn good reports on productivity (2.6% annualized increase) and employment (274,000 new jobs in April, and over 700,000 in the past three months), you would think the reporting on the economy might be a little more upbeat. Well, not really. The New York Times (link requires registration) said that “(the news) dented much of the gloom that had accumulated after a number of recent measures provided evidence that last year’s robust growth might be fading.” Did the NYT use the term “robust growth” to describe the economy while it was clearly growing last year? Donald Luskin refers to a more comprehensive look at the downbeat business reporting during the two years of the recovery, and has more on the contortions a liberal think tank had to go through to avoid being positive.
  • (A personal peeve) When are the wifi providers at the airports going to realize that lower prices mean more business and more revenue? It would be great to check e-mail, catch up on other news, and maybe even blog a bit during the hour or so before boarding a flight, but not if it costs $7-$10 to do so. If the price were $2-$3, I’d do it in a heartbeat, and I would think that the volume of users would absolutely explode. With bandwidth costs as low as they are, I’m not seeing a downside to a $2-$3 charge from the providers’ perspective. If I’m wrong, e-mail me and tell me why.