Category: zerohedge

Authored by Daniel Lacalle via The Mises Institute,

Anyone who believes the “rich” and large corporations will pay for $28 trillion in debt or the $2 trillion in new deficit has a real problem with math.

Biden’s announcement of a massive tax increase on businesses and wealthier segments of the population simply makes no sense. The tax hikes will have a significant impact on economic growth, investment, and job creation and do not even scratch the surface of the structural deficit. Even if we believe the gross domestic product growth and revenue estimates announced by the Biden administration, the impact on debt and deficit is negligible. So, what is their response? That debt and deficits do not matter because the key now is to spur growth and the cost of borrowing is low despite rising debt.

Furthermore, the Biden administration has been inundated by MMT (modern monetary theory) proponents who passionately believe that deficits are good because they attend to the rising global demand for US dollars. Additionally, the Biden administration argues that the deficit increase is not a problem because the Federal Reserve continues to purchase government bonds, keeping yields low and debt costs stable.

Nice, so why the tax hikes, then?

If debt and deficits do not matter and growth and jobs is what we need to focus on, then why increase taxes?

The entire tax increase argument crumbles. There is absolutely no rationale for such massive hikes either from the revenue perspective or the growth objective. If growth will take care of the rising deficit, the Biden administration should use all the tools to support growth.

There are three main reasons why the tax increase makes no sense.

First, estimated real revenue impact is negligible. In 2018, the federal capital gains tax revenue was $158.4 billion. A five–percentage point increase in the current regime would provide an additional $18 to $30 billion according to Princeton University estimates in an optimistic scenario where there would be no negative impact of the tax increase. The estimates of revenues of the corporate and personal tax increase assume $691 billion from corporate taxes, $495 billion from global minimum tax, and $271 billion from so-called repeal tax loopholes, end–fossil fuel tax breaks, and anti-inversion deals. Obviously, these estimates are optimistic and in many cases science fiction as they consider a perfect world where these taxes will not have any negative impact on the economy and a GDP growth that will not be affected at all. Even if we accept the estimates, these revenues are spread throughout a decade (yes, ten years), so the net-present-value impact is even worse.

These do not even start to address the rise in mandatory spending that drives the structural deficit above 2.5 percent of GDP.

Second, the impact on the economy will be larger than what the Biden administration estimates. These tax increases do not affect only “the rich.” Such high capital gains tax stifles innovation and reduces capital flow into private equity which is essential to boost start-ups and new high-productivity businesses. This is the reason why Europe has reduced capital gains taxes and even eliminated them. Belgium, Luxembourg, Switzerland do not have capital gains tax. Of the countries that do levy a capital gains tax, Greece and Hungary have the lowest rates, at 15 percent. European countries average 19.3 percent. The same happens with the corporate tax rate. The United States would have the highest corporate tax rate in the Organisation for Economic Co-operation and Development under Biden’s plan (28 percent). Many argue that effective corporate tax rates are lower and that in other countries firms pay value-added tax, and the arguments are only partially correct. The European Commission showed that the effective average tax rate of United States companies was 36.5 percent compared to 21.1 percent in the average of the European Union. When comparing effective rates, many United States analyses play the trick of adding loss-making companies or averaging what a tech giant pays in the US with the rest of the sectors. However, none of these arguments matter if you look at the tax wedge that United States companies pay relative to other OECD companies. According to PWC, the total tax wedge and contribution of United States businesses was 43.8 percent (profit, labor, and other taxes) compared with a region average of 38.9 percent.

The risk of outflow of capital from the United States to other countries with more competitive taxation is evident to anyone that has run a business or a financial firm. These tax increase may have little impact on multinational corporations, but they do have an exceptionally large negative effect on medium-sized businesses. That is why these measures are regressive.

Even Yellen knows this tax increase is damaging. That is why she wants a global tax. If she saw no negative impact, she would let other countries manage their taxes as they wish.

Third, the problem of mandatory spending is not even addressed. Mandatory spending in the United States has ballooned to $2.9 trillion in 2020 from $1.8 trillion in 2008 and is estimated to rise another trillion in the next ten years. The main cause of the United States deficit comes from the rise in mandatory spending as receipts cannot match the unstoppable increase in spending that no government can touch. Economies grow and enter recessions. It is impossible to cut the deficit via tax increases when the pace of growth of the expense side exceeds the economic output and receipts even in growth periods.

No serious economist can believe that tax increases will generate sustained annual revenues in any economic cycle, be it growth, stagnation, or recession to cover more than $200 billion every year in spending increases over a trillion deficit.

So why does Biden do it? To please the most socialist part of his administration and voter base, who do not worry about the economic implications; they only want to make the rich poorer.

If making money in capital markets is so easy, why don’t the politicians facilitate things to allow everyone to do it? Furthermore, if they believe making money in capital markets or in a business is so easy, why don’t they do it themselves?

Biden’s tax increase plan does not make sense from a growth, revenue, or deficit perspective. Furthermore, it does not make sense from a Republican or Democrat perspective. It simply does not add up and does not address the United States problem: ballooning mandatory spending.

Stocks are surging Thursday on reports that German Chancellor Angela Merkel has reportedly announced that she will oppose a proposal to waive IP protections for COVID-19 vaccines. The decision represents a major break with the Biden Administration, perhaps the biggest rift between Berlin and Washington since President Trump left office.

• MERKEL OPPOSES BIDEN PLAN TO WAIVE CORONA VACCINE PATENT

According to a spokeswoman, the plan would create “severe complications” for the production of vaccines, according to German government spokeswoman. Biden’s top trade rep revealed yesterday that the White House had decided to back the proposal for a waiver at the WTO, breaking ranks with a host of developed countries to join a host of developing nations in a conflict between rich and poor nations.

Shares of vaccine makers and biotech stocks more broadly sold off on news that Biden was backing the waiver. But they’ve bounced back on reports of Merkel’s opposition. The Nasdaq biotech stocks trimmed their losses, leading the index higher, while Moderna erased some of its losses.

The news dragged US stocks higher, reversing the losses triggered by news of Biden’s support for the proposal, which was originally put forward by India and South Africa. The countries are pushing for resolution of the issue by December.

Analysts at BofA pointed out that waivers are “not an existential threat..” but instead a “relatively modest threat” for the biotech sector given: (1) high barriers to vaccine development.. (2) a short window for competitors to contribute to supply given that $PFE $MRNA expect to .. produce >9B doses by YE22 ..”

It still remains to be seen whether other major developed powers, like Japan, Norway and the UK, will weigh in on the proposal.

With the Nasdaq set for its biggest weekly drop since the end of March, when “that” catastrophic 7Y auction sparked reflation fears and hammered tech stocks and duration in general…

… it will hardly come as a surprise that someone has been puking tech stocks, especially after we reported on Tuesday that in the past 4 weeks BofA’s hedge fund clients had sold a record amount of stocks.

Today, in an update report from Goldman’s Prime Brokerage, we learn just how acute the tech revulsion has been within the hedge fund community.

While superficially appetite for risk was present, with GS Prime writing that its book “was modestly net bought yesterday (+0.5 SDs vs. average daily flow of the past year), driven by risk-on flows with long buys outpacing short sales 1.6 to 1” with “7 of 11 sectors were net bought on the day led in $ terms by Comm Svcs, Real Estates, Consumer Disc, and Utilities” a detailed look reveals that the smart money has now decided to target continued declines in tech.

Indeed, validating the recent horrific price action in tech, Goldman Prime notes that i) Tech stocks were net sold for a 7th straight day (9 of the past 10), and more improtantly, ii) the bulk of this selling was short selling, i.e., the flows were “driven by short sales outpacing long buys 2 to 1.”

As a result of the aggressive selling/shorting, Info Tech’s weighting vs. the SPX now stands at -3.3%, the most underweight level since December. Digging deeper, on an industry group level, Goldman notes that managers are the most U/W Tech Hardware (-5.6%) followed by Semis & Semi Equip (-2.4%) while still O/W Software & Services (+4.8%).

Why does this matter? Because the last time we saw such coordinated hedge fund selling was at the end of April when we noted that “Hedge Funds Sell Stocks 7 Of The Last 8 Days“, a move which we said would precede a major short squeeze and sure enough in the days that followed both the S&P and Nasdaq hit all time highs.

Now that the selling is far more focused in tech – for obvious reasons: reflation fears, taper concerns, WFH trade ending, a coordinatred campaign to crush Cathie Wood, etc. – it is safe to say that tech is about to experience yet another squeeze, something we predicted first yesterday…

We are about to see a major tech short squeeze pic.twitter.com/eLLoW3SQPN

— zerohedge (@zerohedge) May 5, 2021

… and which today’s Goldman Prime data just confirmed.

Last week, we first highlighted an unusually large position being built in Eurodollar Mid-Curve options anticipating a Fed hawkish shift in outlook built around the Jackson Hole event held in late August.

Bloomberg’s Edward Bolingbroke was the first to highlight the massive ED trade by an unknown entity, who appears to be betting that the Fed’s dovish stance will end with a bang not in June, as many analysts predict, but in August with Powell making the inevitable taper announcement at Jackson Hole, which will lead to a bloodbath across the curve and especially the short-end.

Why Jackson Hole?

Because last year, Powell unveiled a new policy framework for inflation, while in 2012 Ben Bernanke signaled more bond purchases were on the table.

Since we first noted it, there has been a burst in eurodollar options activity involving a position that will benefit from this potential ramp-up in taper rhetoric in August, and Nomura’s Charlie McElligott notes that, ahead of tomorrow’s much-anticipated payrolls print, there has been a dramatic increase in the ‘eurodollar whale’ position.

Source: Bloomberg

In Sep21 3-year mid-curves OI rose 80.8k in 98.00 puts after outright buying in 100k at 6.5; open interest in the strike totaling 284.5k appears to reflect customer longs, as there appears to be ~200k in 3EU1 98.00/99.00 risk reversal (buying puts, selling calls)

To get a better handle on the demand for this position, we can look at implied vols for those options…

Source: Bloomberg

Eurodollar futures imply around 5 rate-hikes through September 2024 and the ‘eurodollar whale’ position is betting that The Fed will hike at a faster-than-expected pace (implying 7 rate-hikes)…

Source: Bloomberg

With Dallas Fed’s Kaplan saying that he “wants to see taper talks start sooner rather than later,” warning that there are “side effects” from Fed bond-buying and tomorrow’s payrolls data anticipated to be over 1 million jobs added, perhaps it’s not so far-fetched to see Jackson Hole as the place to begin thinking about thinking about normalization.

Baille Gifford and company has been one of the most ardent Tesla bulls over the course of the last few years, sticking with Musk through thick and thin, and vowing that it would always be a supportive shareholder refusing to sell its shares even when many others did.

But now, perhaps not unlike Tesla’s relationship with China, it looks as though the honeymoon could be over. The firm appears to have dumped 40% of its stake in Tesla in Q1 2021. It previously held more than 27 million shares of Tesla. 

In a Form 13F filed on Thursday, we learn that that Baillie Gifford sold 11,088,110 shares of Tesla in Q1, according to WhaleWisdom. This leaves the firm with a 1.68% stake in the company.

Recall, back in September 2020 when Baillie Gifford’s holdings in Tesla fell under 5%, the firm said they would remain significant holders in the name:

Anderson said Baillie Gifford would remain ‘significant shareholders for many years ahead’.

‘Tesla no longer faces any difficulty in raising capital at scale from outside sources but should there be serious setbacks in the share price we would welcome the opportunity to once again increase our shareholder,’ he said. 

It looks like Baillie Gifford could be rethinking that strategy.

Developing story

Authored by Paul Joseph Watson via Summit News,

Comedian Trevor Noah raged against health authorities in the U.S. insisting that people who have received the vaccine will still be subject to COVID-19 restrictions, arguing this will discourage others from getting the jab.

The CDC recently released new guidelines outlining how even those who get the vaccine should still wear masks and practice social distancing in a number of situations.

“The really frustrating thing…is that they’ve spent months, they’ve spent 5 months telling us to get vaccinated – ‘oh get vaccinated and this will all be over’ – and I was like great, I’ll get all four vaccines if it means I’ll get my life back,” said Noah.

“But now they’re putting out a chart and it says even if you get vaccinated, you can only do two more things without a mask on – two!”

“Guys, what the hell? The shit you’re telling people is incoherent. You’re telling us these new vaccines are 95% effective and will stop coronavirus but we still can’t do anything without a mask on – which is it?”

The penny may have finally dropped for this monumental dipshit. pic.twitter.com/l8VJCPV5SI

— Gar🐝 J👀man (@Gee2TheAitch) May 6, 2021

“Is this one of the most effective vaccines in the world or does it not work? It’s not clear messaging especially if you’re desperately trying to convince people to get the vaccine.”

Noah compared the situation to if every time someone ordered an Uber, they were told, “Oh, your Uber’s coming in 5 minutes, but maybe also get a lift, you know, just in case.”

Apparently, Noah didn’t get the memo that the “new normal” means continuing to be subjected to pedantic restrictions even if you’ve already slavishly complied with all the previous demands.

As we have previously highlighted, the scientific elite don’t really care about encouraging more people to get vaccinated, they’re just creating the justification to discriminate against those who refuse to do so.

Elsewhere, the Comedy Central host also suggested that media outlets shouldn’t report on adverse side-effects from vaccines.

“The media loves running stories about the few people who are having adverse reactions to the vaccine. ‘Oh man got a vaccine, now his foot is sore. Oh, woman got a vaccine, now she forgot it’s Thursday.’ Because even though those cases are a tiny minority, those are the stories that people want to hear the most, right?” he said.

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While most of the attention in recent days has focused on copper, overnight both Iron ore and steel climbed to records as Chinese investors returned from a three-day holiday and sparked a furious rally.

Spot iron ore prices topped $200 a ton for the first time ever, as futures in Singapore and China climbed. Iron ore with 62% content hit $201.15 a ton on Thursday, according to Mysteel. Futures in Singapore jumped as much as 5.1% to $196.40 a ton, the highest since contracts were launched in 2013. In Dalian, prices closed 8.8% higher.

The story is familiar: steel demand is soaring as economies emerge from covid lockdowns just as the world’s biggest miners have been hampered by operational issues, curbing ore supply.

The boom as Bloomberg notes, comes even as China’s steelmakers keep output rates above 1 billion tons a year, despite a swath of production curbs aimed at reducing carbon emissions and reining in supply. Instead, those measures have boosted steel prices and profitability at mills, allowing them to better accommodate higher iron ore costs.

“China’s plan to cut steel output is not showing any success,” wrote RBC analyst Kaan Peker. While steel production outside China has been slow to ramp up, output should start to recover from late in the second quarter, he wrote.

Meanwhile, according to Fitch, the rally has more room to run, though prices will likely grind lower during the second half of 2021 as supply improves and demand growth slows. There’s also a risk that China could engage in policies that may stymie the rise in iron ore prices abruptly, it said. As a reminder, a similar surge in copper prices which pushed them above $10,000 last week and set to make a new all time high, has unleashed havoc on China’s copper-reliant economy, as “some Chinese manufacturers of electric wire have idled units and delayed deliveries or even defaulted on bank loans, according to a survey by the Shanghai Metals Market.” Meanwhile, end-users such as power grids and property developers have also been pushing back delivery times, unable to pay for the metal, while producers of copper rods and pipes saw orders slump this week, said the researcher.”

Indeed, it’s all fun and games as long as leveraged speculators can keep piling on even more leverage to push the price higher, but to buyers of the end product, the price surge is nothing short of catastrophic.

The Thursday surge in iron ore came after Beijing said that it was suspending a ministerial economic dialog with Australia. While a largely symbolic move, ties have worsened in recent years and China has hit Australian barley and wine with crippling tariffs and told traders to stop buying commodities including copper, sugar, timber and lobster. So far iron ore has been spared in the spat, as the Asian nation relies on Australia for about 60% of its imports. Should iron be swept up in the growing trade war, there is no telling how high its price will rise.

Meanwhile, on the steel front, rebar closed at the highest since futures started trading in 2009..

… and hot-rolled coil was at the highest since contracts were launched in 2014.

Less than a week after Dalla Fed president and Former Goldman partner, Robert Kaplan sparked a selloff in markets when he pointed out the obvious saying that “we have real excesses int eh housing market” and said that rates should start rising in 2022, moments ago he sparked another dump in stocks when after several days of carefully worded statement by Fed officials, the non-voter expressed his desire for tapering to start soon, saying “the Fed should start the taper debate sooner rather than later.”

While saying that he still supports Fed bond buying, the economy has improved faster than expected and as a result the Fed is likely to achieve its “substantial progress” metric faster than expected.

He then poured some more gasoline on the fire, saying that he doesn’t want the Fed to be preemptive but doesn’t want it to be late either (too late for that Robert – take a look at some of the latest inflation prints).

Kaplan then provoked some speculation that he is trying to undo the Fed’s carefully worded party line – according to which QE is sainly and has no adverse side effects – by noting what everyone already knows, namely that there are side effects to Fed bond buying.

And the punchline:

• *KAPLAN:HAVEN’T DECIDED IF INFLATION IS PERSISTENT OR TRANSITORY

Well, Robert, here’s a question: when is the last time you saw a company cut prices after it had just raised them (and as we showed on Tuesday, about 50 corporations have done just that in the past few weeks). And since you won’t answer, we suggest you read the recent note from JPM’s resident permabull Marko Kolanovic according to whom there is surging risk of “more persistent inflation”, as in not temporary.

In response to Kaplan’s hawkish comments stocks, which were already weak in early trading, slumped to session lows, forcing the Fed to engage in damage control again as today’s remaining speakers offset Kaplan’s remarks, while Yellen White House appearance tomorrow will likely be dedicated entirely to easing frayed investor nerves.

That didn’t take long.

After a deal over fishing rights became a major sticking point that almost scuttled a Brexit trade deal between the UK and EU, France and the UK are already feuding over fishing licenses that are supposed to be approved by the UK-dominated island of Jersey, which is facing threats of having its electricity cut off by France if it doesn’t stop stalling on issuing fishing licenses to French ships.

Brussels has already backed France and accused the UK of breaking the newly ratified deal in dispute over Jersey fishing licenses.

Alarmed by France’s threats and a mass of fishing ships arriving in its harbor setting off red flares in protest, the Royal Navy has sent two ships that have just arrived in the island’s waters. PM Boris Johnson, who was reportedly only made aware of the conflict this week, says he stands behind the island of Jersey, which is a protectorate of the British Crown.

French fishermen and ministers have been complaining for two weeks about the difficulty of gaining access to British waters despite the agreement on fisheries reached at the end of last year. Apparently, the British applied new conditions to fisheries applications requiring fishermen to prove via GPS that they have been fishing in Jersey waters, the FT reports.

Small boat owners argue that they do not have GPS technology and the other electronic surveillance equipment required. Other special conditions attached to the licenses relate to the fishing gear itself. The EU-UK trade deal allows the UK to impose new requirements, but they must be based on “clear scientific rationale”. In this case, there doesn’t appear to be any rationale for its demands.

France’s warning followed claims from Paris that Jersey was stalling in issuing licenses to French fishing boats under the terms of the trade deal. The agreement provides for retaliatory measures to be taken. And Brussels has bolstered France’s claims, with the European Commission having “indicated to the UK” that the provisions of the trade deal “have not been met…have not been respected”. France supplies 95% of the island’s electricity via undersea cables.

Following the French threats to cut off the island’s electricity supply, two Royal Navy ships, the HMS Tamar and HMS Severn, have been sent to patrol the crowded waters off Jersey to ensure that French “protests” remain peaceful. France also deployed two vessels of its own along the maritime boundary between French and Jersey waters. According to reports from Bloomberg, French fishing boats have started to leave Jersey waters as the protest winds down.

A French boat has been spotted ramming a British vessel in Jersey waters.

More on this story 👉 https://t.co/k1YdveP8Wm pic.twitter.com/9lv7RLnBAC

— Sky News (@SkyNews) May 6, 2021

While Brussels backs France, Lord Daniel Hannan, a former conservative MEP and member of the UK Board of Trade, accused French President Emmanuel Macron of behaving more like an autocrat than a diplomat with his aggressive threats to cut electricity to Jersey. All of this, Hannan complained, is part of a disturbing trend of “dictatorial behavior” exhibited by President Macron.

Here’s more from the Daily Mail:

These days, France is supposed to be a Nato ally. Yet here it is threatening the sort of sanctions that might be more aptly deployed against an enemy, such as North Korea.

Part of the explanation might lie in Emmanuel Macron’s increasingly dictatorial behaviour. It is extraordinary to think that the French president was once hailed as a liberal centrist.

During the recent row over vaccines, for example, he made the kinds of statements that get anti-vaxxers banned from social media, claiming that the Oxford-AstraZeneca vaccine was ineffective, but simultaneously demanding legal action to get more of it.

His grandiose gestures — yesterday, he laid a wreath at the tomb of Napoleon, who destroyed the French republic with a putsch then plunged Europe into a series of disastrous wars — suggest autocracy rather than moderation.

Perhaps he is worried about the rise of Marine Le Pen, who is catching up with him in the polls. Last week, the leader of the National Rally endorsed a letter written by 20 retired generals that hinted at a military intervention to prevent France sliding into chaos — a letter backed, according to the polls, by 58 per cent of French voters.

Perhaps Macron wants to burnish his nationalist credentials. Perhaps he calculates that bashing the Brits (in the eyes of most French voters, Jerseymen count as Brits) plays well with the home crowd. Or perhaps he sees himself as another Bonaparte, leading France to glory.

Whatever the explanation, he plainly likes to exaggerate his quarrels with the UK, not least over fisheries.

Under the terms of the trade deal, should the dispute persist, the EU side could request the formation of an arbitration panel to review the situation and make a ruling. If that ruling isn’t followed, it could petition for sanctions.

Authored by Robert Wright via The American Institute for Economic Research,

I was recently driving east from Omaha for sixteen hours and there was nothing much to do so I let the radio linger on a “public news” show that consisted of two rational-sounding adults discussing how “the” science is now clear, the government must ban the production and sale of menthol cigarettes.

In 2019, I would have busted out laughing but now that America’s authoritarians have so clearly revealed their cloven hooves I figured I better pay close attention. I have never smoked and all my friends and relatives who did are now dead (none from smoking-related illnesses interestingly enough) so the matter interests me only as an example of the use and abuse of state power and the rhetoric of science.

According to the discussants, one of whom apparently is funded by the Kochs (who pay federal taxes), the Food and Drug Administration (FDA) wants to ban all “combusted” tobacco products but it is statutorily banned from eliminating an entire class of goods, so for now it is targeting just menthols and flavored cigars.

Before I could muse too deeply about that logical solecism, the Koch-funded guy said the ban was specifically designed to help African-Americans as four out of five of the smokers among that group prefer menthols. The host pushed back modestly, suggesting that menthols could become the new marijuana, i.e., the excuse to accost, arrest, and convict African-Americans for possessing or dealing something that should never have been illegal in the first place. Oh, the G-man said, law enforcement would never do that. The ban, he claimed, presumably with a straight face (but again it was radio so …), is all about stopping production.

Okay, let’s think this through. A ban will not appreciably diminish demand and in fact may increase it because, you know, people be people. And while there is no doubt that the FDA can crack down on mass manufacturing, it is almost powerless to stop smaller scale production. A ban will increase production costs and prices for African-American smokers and cause some to be hurt by botched illegal batches.

After all, tobacco would still be legal so nothing could be done about growing, processing, or shipping it. Tobacco turns menthol by adding synthetic chemicals, all legal for other purposes like mouthwash, or oil made from mint plants (Mentha arvensis), which can be farmed but also naturally grows throughout temperate Eurasia and North America. Even with concerted human effort to eradicate it, mint will go extinct the same time cockroaches and sharks do.

Because some mathematicians now claim that one plus one does not equal two, let me explain what those facts mean in the real world that policymakers, of all people, are supposed to inhabit. Anyone can easily make menthol cigarettes. In fact, entrepreneurs right now are probably planning on making menthol conversion kits that will allow smokers to soak legal tobacco in mint oil, dry it, and roll it by machine (here is an example of the last mentioned technology if you are unfamiliar), for self-consumption or under the table sale.

So to effectively ban menthol cigarettes, the FDA will have to ban tobacco entirely, something it has admitted is not in its power to do. Or it would have to destroy the environments in which mint grows naturally throughout the world and ban all possible chemical substitutes and their constituent parts.

This is why liberty lovers always warn about the “slippery slope” of regulatory authoritarianism. Effectively banning just one simple thing usually requires widespread repression.

The racial component of the FDA’s argument is extremely troubling. Too much of anything, even water, can be harmful. (No joke, it is called water toxemia among other things.) Apparently, nothing could stop the FDA from banning monosodium glutamate (MSG), matzo balls, Buffalo wings, or anything else. All it needs to do is to find “scientists” willing to publish studies showing such things to be harmful — and again everything, even MSG, is harmful to some extent — while carefully parsing the category so as not to include all sodium salts, dumplings, or chicken wings.

But the FDA would never have an incentive to ban such things, you might think. Well, what motivation, other than paternalistic control over others, does it have for banning menthol smokes and cherry blunts? Whatever happened to our bodies, our choice? Where does the government think that its power ends? How many Americans agree with that line? What is to become of those who disagree, who still believe in freedom and individual responsibility? Banishment? Reservations? Soft execution by forcing them to smoke seized menthols?

There exists only one thing that needs to be banned that I can think of — big, intrusive government.