The Socialist Delusion Is Alive And Well In The Democratic Party

If you look into world economic statistics even minimally, the first thing you notice is the remarkable correlation between economic freedom and economic success.  The Heritage Foundation puts out an annual ranking of all countries in the world by economic freedom.   The number of countries ranked is 178.  I'm sure there's plenty to question in their methodology, but it would just be quibbling.  There really isn't much to argue about over whether the likes of the likes of Hong Kong, Singapore, New Zealand, Australia and Switzerland belong at the top in economic freedom (or at least somewhere close) while Zimbabwe, Venezuela, Cuba and North Korea belong at the bottom.  Should Haiti really be ranked as high as 151?    That seems rather generous to me, but then there's not a lot of difference between number 150 and number 170.

And the more free the country, the greater the economic success.  The correlation is not perfect, of course.  But Singapore, Switzerland and Australia are now all ahead of the United States in GDP per capita in all rankings.  Meanwhile, Zimbabwe and Venezuela are collapsing, and for Cuba and North Korea, it's hard even to figure out if they have an economy at all.  Over at Econlib, economist Scott Sumner points out that every country except one with an IMF PPP per capita GDP over $25,000 has a Heritage Foundation economic freedom index in the top half of the 178 countries.  Can you guess the one?  It's Greece!  Greece is way down at number 130 in economic freedom.  The government meddles everywhere in the economy, and the labor markets are tied up in knots.  Sorry, but that $25,000 GDP per capita is very likely to prove to have been an illusion -- some combination of the spending of other people's money and fallacious counting of unproductive government spending at 100 cents on the dollar in GDP.  Greece's GDP is projected to decline by something like 7% this year.  Actually, that "decline" probably mostly results from correcting the previously-inflated measurement to something closer to the level the economy was at all along. 

And then there was the Soviet Union.  OK, its collapse was 24 years ago.  Have we all forgotten?

I ask because out there on the campaign trail, Democratic presidential candidate Bernie Sanders is drawing big crowds and rising rapidly in the polls.  Jim Tankersley in today's Washington Post points out that Sanders not only embraces the term "socialist," but also has expressed complete willingness to give up economic growth in favor of income redistribution:

[Sanders is] saying that America’s leaders shouldn’t worry so much about economic growth if that growth serves to enrich only the wealthiest Americans.  “Our economic goals have to be redistributing a significant amount of [wealth] back from the top 1 percent,” Sanders said in a recent interview, even if that redistribution slows the economy overall.  “Unchecked growth – especially when 99 percent of all new income goes to the top 1 percent – is absurd,” he said.

The Sanders economic program calls for increased government spending and programs without any recognition of capacity or limits.

• Increase federal spending by $1 trillion to "support 13 million jobs"!
• Affordable child care!  Paid family leave!
• Expand Social Security!
• Expand Medicare and Medicaid!  (They're headed for a crash?  Raise taxes!)
• Government pays for all healthcare!
• $15 minimum wage!  (How has a high minimum wage worked out for Puerto Rico?)
• Free college for all!
• Protectionism to help retain manufacturing jobs!
• Higher taxes!  Still higher taxes!

Does the idea occur to Bernie or his followers that it is possible to kill the goose that laid the golden egg?  For those willing to look, there actually are examples of countries that fell back from relatively rich to lower middle income (Argentina, Greece), and from middle income back to poor (Venezuela).  And the route there is always the same.  It's the route advocated by Sanders.

And by the way, how different is the route advocated by Hillary Clinton?  As far as I can see, the difference between the two is that Sanders is willing to advocate specific proposals, while Hillary sticks to vague generalities.  

How I Know That The Paris Climate Meetings Won't Accomplish Anything

The big U.N. climate meeting to end all climate meetings is set for November 30 to December 11 in Paris.  It's only July, and already the pre-meetings to the pre-meetings to the big meeting are getting into swing.  President Obama talks endlessly about saving the planet.  You can almost feel the excitement among the greenies.  Finally the rich world is to be cleansed of the sin of industrial civilization and fossil fuel burning!

Don't worry.  This thing is going nowhere.  Sure lots of people are still keeping up their game faces, but the program is falling apart everywhere you turn.  Time to start looking at what people are doing instead of what they are saying.

Take the U.K.  PM David Cameron has always talked a "green" game.  In the real world his party just won full control of Parliament and has dumped its former Lib/Dem partners, one of whom was the minister of the Department of Energy and Climate Change.  Now with the Tories fully in charge they are actually starting to look at the costs.  From the Telegraph of July 5:

The cost of subsidising new wind farms is spiralling out of control, government sources have privately warned. Officials admitted that so-called "green" energy schemes will require a staggering £9 billion a year in subsidies – paid for by customers – by 2020. The Chancellor believes the figures demonstrate the need to rein in the cost of policies to tackle climate change. 

Germany?  The so-called Energiewende ("energy transition") has already cost over 100 billion euros and approximately doubled electricity prices, while getting the percent of their electricity derived from wind and solar all the way up to about 16%; but electricity is only about half of their energy consumption (the rest being heat and transportation), so wind and solar have only reached about 8% of overall energy consumption.  A new study from consultants Roland Berger, reported in Frankfurter Allgemeine Zeitung on July 1, estimates that meeting current "politically-demanded" renewable targets will require another 280 billion euros: 
The German energy transition has cost more than 100 billion euros so far. It has hit large and small electricity suppliers with force and put traditional business models in question. But 15 years after the start of the transition of the power sector with the aim of renewable, low-carbon generation, experts are asking themselves an anxious question: is the energy transition running out of money?

I guess that means that electricity prices will be doubling again, or maybe tripling.  Is that OK with, say, the lower middle class over there, soon to be cast into energy poverty?

How about India?  They have several hundred million people who still don't have electricity at all.  Can those poor people now get access to it?  From Anil Swarup, permanent secretary of the coal ministry, quoted in the Guardian on May 27:

“We are looking to double Indian coal production by 2020,” Swarup said, “and to reduce reliance on imports.” Beyond that date, he said production would continue to rise to 1.5bn tonnes a year, with most of this being burnt in coal-fired power plants. In the past six months, the government has given environmental clearance to 41 new mining projects. The consequence, Swarup said, is that from now until 2020, “a new mine will be opened every month. You have to work on the assumption of requirement, and in India, there is a need for power.”

Or try this from Prakash Javadekar, the cabinet minister in the new Modi government responsible for the environment and climate (among other things), quoted in the same Guardian article:

“Our emissions will grow because we are not developed and we have a right, every person on this Earth has a right, to develop. If today the world is 0.8C warmer [than it was in pre-industrial times], it is not my fault. It is the historical responsibility of those who started emitting with the industrial revolution.”

Here in the U.S., the media outfit most known for endlessly promoting the climate scare and other left-wing political causes is undoubtedly NBC.  For example here on February 24:

The experts said heading off a food crisis will require changes in every aspect of production and consumption.

NBC's "experts" include famous doom-monger Paul Ehrlich, who is quoted as saying "we may have [only] 10 or 20" years to stop using fossil fuels to solve the climate crisis.  Well, that's NBC's left hand.  With the right hand, they've just started a ten year partnership with --- NASCAR!!  Otherwise known as the most over-the-top blowout completely unnecessary just-for-the-fun-of-it mega-consumption of fossil fuels ever conceived.  Won't that 10-year partnership take us right up to the edge of Ehrlich's window of doom?

But actually, even that can't top our President, Barack Obama.  You may recall that back in April on Earth Day the President flew down to Florida on Air Force One to give a speech hectoring everybody else to use less carbon.  While there his spokesman Josh Earnest then had to field this question from Mark Knoller of CBS:

On the Everglades trip, does the President risk undermining his message when he flies to the Everglades hundreds of miles on a 747 to make a statement about climate change?

(The short version of Earnest's answer was "no."  What else was he going to say?)  But what Knoller's question didn't even mention, of course, was that the President doesn't actually ever go anywhere with just one 747.  Air Force One is actually two 747s, the second of which is never more than 30 minutes away.  You know, just in case.  Each uses about 5 gallons of fuel per mile flown, and costs over $200,000 per hour of operation.  Do you think that might be a little excessive?  Actually, the government, under the direction of our President, is in the process of getting replacements for the two Air Force Ones, which of course will be larger and far more expensive.  The old ones are mere 747-200Bs, with about 4000 square feet of space each.  The new ones are to be 747-8s with more like 4,786 square feet.   The list price of the planes -- before upgrades for the President, which undoubtedly will be extensive -- is $367 million each.  Did I mention that they are talking about getting three of them, instead of the current two?  I can't find anywhere where they say whether all three will now be going around everywhere with the President.  But hey, why not?  For the President, all excess, no matter how wild, is normal.

This is the guy who supposedly is going to talk India into not building any more coal power plants and keeping hundreds of millions of people in abject poverty?  As I said, this Paris thing is going nowhere.  

What Do Greece, Puerto Rico, Detroit and Baltimore Have In Common?

Consider four disparate government jurisdictions:  Greece, Puerto Rico, Detroit and Baltimore.  Mostly what you've read recently about these places is that they have high government spending and unsustainable debt, supposedly incurred in the effort of the government to achieve some combination of helping the people, growing the economy, and creating greater fairness.  What you've probably read much less of is how the overspending and run up of debt play out in the realm of real economic performance.  

When you look at the statistics, what stands out dramatically in case after case is the association of too much spending and debt with high levels of idleness and unemployment, particularly among younger people.  Is it cause and effect?  You be the judge!

Greece is of course the European champion of profligate spending and exploding debt.  According to statistics at Eurostat here, government spending in Greece exceeded 50% of GDP continuously from 2008, and even broke 60% in 2013.  Add in a tax system famous for extreme levels of avoidance, and you get extraordinary deficits.  According to Trading Economics here, Greece's government budget deficits averaged 7.19% of GDP from 1995 to 2014, with peaks of 15.7% of GDP in 2010 and 12.3% in 2014.  (Supposedly the Greek government budget is now in surplus.  Do you believe it?)

If you think that those huge levels of economic "stimulus" must have really put people to work in Greece, the statistics sure don't show it.  According to World Bank numbers here, the labor force participation rate in Greece is just 53%.   That compares to 63% in the U.S., 62% in the U.K., 60% in Germany, and 56% in France.  (Do you notice a correlation there with government spending levels?)  But unemployment, and even more so youth unemployment, are where it really gets ugly. The latest numbers from Eurostat give Greek unemployment at 25.6%, and youth unemployment (ages 15 - 24) at an extraordinary 49.7%.  (The comparable numbers for the U.S. are 5.5% and 12.2%.)  And don't get the idea that these low labor force participation and high unemployment rates are somehow a consequence of the recent "austerity."  Greek labor force participation was the same 53% back in 2000 and even lower at 51% in 1995, even as it engaged in the usual Keynesian deficit spending prescriptions.  According to statistics here from indexMundi, Greek youth unemployment has averaged over 25% since 1990, never below 22% and sometimes over 30%.

In Puerto Rico it's the same thing: high spending and extraordinary public debt accompanied by dramatic underutilization of the labor force.  Puerto Rico's public debt of about $72 billion hit the headlines a few days ago when its governor announced that the debt "is not payable."  The $72 billion, a little over $20,000 per capita, seems not that much worse than New York's (around $19,000 per capita), until you realize that median household income in New York is almost triple that in Puerto Rico.  But anyway, all that government spending in Puerto Rico must at least have put lots of people to work, right?  In fact, add to all the spending by Puerto Rico full access to U.S. welfare, food stamp, medicaid and other handout programs.  By standard Keynes/Krugman theory, its economy should be booming.  But actually, it's the opposite.  Puerto Rico has spectacularly low labor force participation rate of under 43%.  That's a full 10 points worse than Greece.  And even with 43% labor force participation, Puerto Rico still has 12.2% unemployment.  (If Puerto Rico had the same labor force participation, 63%, as the rest of the U.S., and the same level of employment, its unemployment rate would be close to 50%.)  Youth unemployment?  The latest figures I can find are World Bank figures from 2013, which give a rate of 27.3% for Puerto Rico; and again, that must be taken in context of the spectacularly low labor force participation.

And check out the usual suspects of "basket case" U.S. cities, and time and again you find the same thing: blowout spending and borrowing does not cause the economy to improve, but instead is accompanied by high levels of idleness.  In Detroit, a city that famously spent and borrowed its way into bankruptcy, the labor force participation rate for black males is 52.1% according to most recent BLS data (2011).  That's even worse than Greek levels.  Baltimore?  The overall BLS statistics for the Baltimore/Tyson metropolitan area do not seem at first blush to reflect the same levels of idleness.  For example, these BLS statistics for 2011 show black male labor force participation for that area as 65%.  But in the aftermath of the recent Baltimore riots, multiple sources have reported that in specific areas like the one where Freddy Gray lived, non-working rates for working age black males were in the range of 50%.  For example, see this op-ed in the New York Times by Michael Eric Dyson.   The areas with the lowest rates of working are the same area where so-called "anti-poverty" government spending is the highest.

So perhaps it is time to consider the hypothesis that the high spending and borrowing is actually the cause, or at least one of the causes, of the unemployment and idleness.  It's not just that the "anti-poverty" programs don't work.  It's also that the high spending and borrowing actively discourage business formations and relocations.  What entrepreneur wants to put his or her business in a place where massive public debt indicates a future of increasing taxes as far as the eye can see?

Puerto Rico: Here Comes The Next Greece

Even as Greece has shut its banks and its stock market and prepares for its big default, the next big sovereign default is coming right behind it.  I'm talking of course about Puerto Rico.  On Sunday the New York Times reported that Puerto Rico's governor, Alejandro Garcia Padilla, had said that Puerto Rico's debt of some $72 billion "is not payable."

You are probably thinking: but Puerto Rico is part of the United States!  It has the huge advantages of free trade and free travel with the United States.  It's in the U.S. dollar currency union.  How could it possibly be in such a position?

But if you start investigating Puerto Rico's economy, you find that it is far worse than you might have imagined.  Median household income is only about $20,000 (per badly lagged Census data here from 2014).  That compares to well over $50,000 for the United States as a whole, and about $36,000 for the poorest of the 50 states, Mississippi.

Completely free trade should gradually be bringing Puerto Rico up to the income levels of the rest of the country, but it is not happening.  Instead, it's income is stagnating, and indeed the population has been shrinking.

And then there is the most astounding statistic of all about Puerto Rico, the labor force participation rate -- the percentage of working age people either working or seeking work.  For the U.S. as a whole, that rate has recently been 62.8%, itself a significant decline from numbers around 67% prior to the recent financial crisis.  In Puerto Rico the figure is around 42%.  That means there is a full 20% of adults who would be working if they were in the rest of the United States, but are not working in Puerto Rico.   Knowing that, is it any wonder that the government is broke?

Now, in considering why this might be, I would invite you to entertain the hypothesis that the federal minimum wage might have something to do with it.  That minimum wage is only $7.25 per hour, far lower than numbers like $15 per hour that are gradually taking effect in places like San Francisco and Seattle, or than the $12 per hour that President Obama has discussed for the country as a whole.  But for Puerto Rico, $7.25 per hour for a year of full-time work represents a very high percentage of that median household income figure above -- assuming full time work of around 1900 hours per year, it's in the range of 70%.  By contrast, full time work for one person at the current federal minimum wage is only about 40% of median household income in Mississippi, and not much more than 25% for the country as a whole.  A $12 minimum wage would only bring the full-time minimum wage worker's annual pay to about 35% of median household income for the country as a whole.

I am not the only person noticing these dramatic numbers.  Here is what Max Ehrenfreund had to say in yesterday's Washington Post wonkblog:

While labor organizers around the country along with most major Democratic politicians have said the federal minimum wage is too low, it seems clearly too high in Puerto Rico, at 77 percent of per capita income. That puts a lot of people with less education and fewer skills out of consideration for a job.

Of course it is not possible to do fully controlled experiments to see what is causing economic performance to lag in one location versus another.  But it's hard to come up with an alternative hypothesis that explains Puerto Rico's dramatically low labor force participation.  The next best one is that federal benefits, like food stamps, are of much more relative value in poor Puerto Rico, and strongly discourage work.  Of course, those two factors could be working together.

If the minimum wage hypothesis is correct, it means that that law has put a huge contingent of low-education, low-skill workers out of work in Puerto Rico.  Intended to benefit the poor, it in fact has made huge numbers of them much poorer.  As to the $15 dollar minimums in rich coastal cities like San Francisco and Seattle, likely the effect will not be so large as to show up quite so dramatically in the government statistics.  But that doesn't mean that the effect will be zero.  And those who get hurt are of course the poorest of the poor.  Shouldn't they be the ones that public policy should most be seeking to benefit?  

On Socialist Death Spirals

Here in the world of capitalism, we are accustomed to the idea that the economy grows every year.  Sometimes the growth is 4 percent in a year, and sometimes it's only 1 or 2 percent, but it is rare to have actual economic shrinkage that goes on for longer than a couple of quarters before growth resumes.  What's going on is that hundreds of millions of people, all seeking to better themselves, and working under the incentives of a (relatively) free marketplace, each year find many small ways to work a little more effectively or efficiently.

In a world of public ownership, government handouts, and "each according to his needs" -- that is, in a world of socialism -- the incentives are the opposite.  Where most of the economy is government-controlled, then for most people, the immediate way to improve your economic condition is to qualify for more handouts; and the way to qualify for more handouts is to become less rather than more economically productive.  For fully or substantially socialized economies one would expect to observe long-term gradual economic decline, and the more fully socialized the faster the decline.  Call it the socialist death spiral.

And yet when you look at statistics coming out of fully or largely socialized economies, that's not what you find.  Instead, what you find is that the official statistics for years and decades show growth comparable to, and sometimes faster than, that in capitalist economies; and then one day, it all falls apart.  Think the old Soviet Union and its satellites.  In my youth in the fifties, sixties and seventies, they regularly put out official numbers showing that their rate of economic growth was faster than that of the United States -- sometimes two or three times as fast.  They tightly controlled internal travel, so there was no way to check their numbers independently.  Then in 1990 and 1991, it all suddenly fell apart in a matter of months.  An economy that even the CIA thought was more than half as big as that of the U.S. turned about to be 10% the size at most.

Of course the numbers had been fictitious all along.  There really was a gradual decline going on, but the numbers didn't show it.  And, without knowing all the tricks the Soviets used at the time, the main one is obvious, namely counting all or most government spending as a full addition to GDP.  Where government owns the main businesses and controls most of the distribution of resources, not to mention prices, the measure of GDP becomes more and more arbitrary.

Something like this is going on in Venezuela right now.  In that country, Hugo Chavez came to power in 1999, and began a gradually-tightening transition to a government-controlled economy.  In his first few years, the official statistics conceded economic decline, as Chavez battled for control of the oil industry and suffered a strike of oil workers.  But starting in 2003, the official numbers showed rapid growth.  Here is a 2012 report from left-wing think tank CEPR on Venezuela's economy from 2002 to 2012.    A few highlights:

[E]ven after the [oil] strike was over [in early 2003], analysts predicted a dire future and a slow, difficult recovery. International Monetary Fund (IMF) forecasts repeatedly underestimated GDP growth by a gigantic 10.6, 6.8, and 5.8 percentage points for the years 2004-2006. Instead, the recovery was very rapid and the economy grew at a record pace over the next five years, with real GDP nearly doubling from the end of the oil strike (first quarter 2003) through the fourth quarter of 2008. . . .  

And then after the recession of 2009:

A recession began in the first quarter of 2009, and forecasts remained dire well beyond the beginning of the recovery in the second quarter of 2010. In 2011, the Venezuelan economy defied most forecasts by growing 4.2 percent, and is up 5.6 percent for the first half of 2012.  

But was it real?  It seems like a lot of the growth was government spending:

In 2011, government spending boosted and consolidated the recovery. . . .   For 2012, the economy grew 5.6 percent in the first half of the year, as compared with the first half of 2011. Here growth was led by construction, which expanded by 22.5 percent over the first half of 2011, due to the government’s program to build housing and alleviate a national housing shortage. In 2011, there were about 147,000 houses built under this program, with two-thirds built by the public sector and one-third from the private sector. 

Those "analysts" who have been "predicting a dire future" for Venezuela for all these years are probably people like me who think that GDP numbers inflated by blowouts of government spending do not reflect real growth.  The CEPR report basically gloats that these nay-sayers don't understand socialism and are always wrong.  The other way of looking at it is that government spending and control of the economic statistics can paper over economic decline for a long time, but not forever.  In the case of Venezuela, it seems that they are running out of time.  This year the IMF is predicting economic decline of 7 percent for Venezuela -- and that is with a continuation of counting government spending at 100 cents on the dollar in GDP.  Real numbers would likely be far worse.  Here's a report from Bloomberg this past week on the disappearance of beef from the country.  

Or maybe the IMF will be proved wrong and Venezuela will put out far better numbers when the year is over.  But it is likely that the Venezuela's numbers are just papering over what is in reality a gradual decline.  When the thing starts to come apart, it will come apart all at once.

So, dear readers, keep all this in mind when you read the next column by Official Manhattan Contrarian Worst Economics Writer Paul Krugman.  According to an article this week in Bloomberg News, since the financial crisis Krugman has written no fewer than 74 columns and blog posts attacking what he calls the "austerians," that is, the analysts and economists who advocate some combination of cutting government spending and raising taxes as the way to achieve real improvement in an economy.  In his screeds, Krugman constantly cites economic statistics from countries that increase government spending showing that their economy has "grown."  Is it real, or are they in a papered-over socialist death spiral?  I mean you, Greece.    

The FDA And The Irresistible Urge To Control Other People's Lives

A few days ago the FDA came out with a "final determination" that "partially hydrogenated oils," sometimes known as trans fats, are no longer considered "generally safe" for human consumption.  These substances will now be banned from the food supply as of 2018, unless someone can talk our all-knowing but merciful overlords into granting a reprieve for some specific use.

So yesterday New York Times food writer and op-ed columnist Mark Bittman uttered the typical New York Times take on the situation.  Basically, the take is "it's about time," and moreover it's only because of immense pressure from "Big Food" that they have waited so long, let alone granted another three years to comply while thousands more people get killed.  As usual in Pravda, no mention is given at all of the idea that individual citizens should have some freedom or say in the matter.

The good news is that — finally — the Food and Drug Administration is banning food containing trans fats, although really only sort of, and really only after overwhelming evidence (and more than one lawsuit) made their dangers impossible to ignore. And in typical pro-industry fashion, the F.D.A. is not only allowing companies three years to get trans fats out of most foods, but will consider manufacturers’ petitions to keep them in. 

Sorry, Mark, but this narrative is complete baloney.  As far as I remember -- and I was around at the time -- it was the government that pushed trans fats on the people.  OK, they didn't explicitly use the word "trans fat," but what they did do was go on a campaign against saturated fat.  And there aren't a hundred alternatives to saturated fat that come close to mimicking its taste and texture.

Here's a history of the subject by Steve Malanga from the Spring 2011 issue of City Journal.   Malanga traces government meddling in your diet back to the 1970s:

Nevertheless, in the 1970s, Democratic senator George McGovern’s Select Committee on Nutrition and Human Needs decided to fight the apparent epidemic by making recommendations on nutrition. . . .   Settling on the unproven theory that cholesterol was behind heart disease, the committee issued its guidelines in 1977, urging Americans to reduce the fat that they consumed from 40 percent to 30 percent of their daily calories, principally by eating less meat and fewer dairy products. The committee also advised raising carbohydrate intake to 60 percent of one’s calories and slashing one’s intake of cholesterol by a quarter.

The government was telling us all to reduce fat in the diet.  And not just any fat -- the fat they really said should be reduced was the fat in "meat and dairy products," that is, saturated fat.    Well, if you cut out meat and butter and your body still wants some fat, that leaves you with margarine and cooking oils as the obvious alternatives.  In other words, trans fat.

So where was the food activist community on this?  Of course, they were accusing the food industry of resisting the government's efforts so that they could keep selling the killer meat and butter.  Malanga:

A good example was the Center for Science in the Public Interest, which in 1975 organized a National Food Day that included, the New York Times reported, an “all-out attack” on foods that it considered harmful. On the hit list: prime beef, high in fat and cholesterol.  When the McGovern committee issued its guidelines, these advocacy groups attacked opponents as shills for the food industry. . . .

In the 70s you were a shill for the food industry if you stood up for meat and butter, and today you are a shill for the food industry if you stand up for margarine and cooking oil.  Go figure.

In 1980, and every five years since, the Department of Agriculture has come out with its official government-approved Dietary Guidelines.  In the 1980 Guidelines and every iteration since, they have strongly urged reduction of saturated fat in the diet.  The 2010 Guidelines -- which are the most recent version and are still out there -- continue to urge reduction of saturated fat in the diet, with barely a passing mention of trans fats.  (The 2015 Guidelines are expected out shortly.  We'll see how they walk this one back.)

Did the government know what it was doing when it urged reduction in dietary saturated fat?  They didn't have a clue.  This ridiculous campaign was based on no more than some simple-minded unproven ideas, like the idea that "fat" must be what makes you "fat," or the idea that fat is kind of sticky so it must be what is "clogging you arteries."  Forty years since the McGovern committee, and still there literally isn't any evidence whatsoever to support the idea that consumption of saturated fats leads to more heart disease or any other bad health outcome.  The longer this goes on the worse it gets.  For example, Malanga cites a meta-analysis of studies published in Scientific American in 2010:

More recent research has further undermined the cholesterol-as-bad-guy hypothesis. Scientific American summed up the disturbing state of the evidence in April 2010. The magazine cited a meta-analysis—that is, a combination of data from several large studies—of the dietary habits of 350,000 people worldwide, published in The American Journal of Clinical Nutrition, which found no association between the consumption of saturated fats and heart disease.

So now, exactly what reason is there to think that these people know any more what they are doing this time around than they did last time?  Do they, for example, have a study of large numbers of people showing a statistically significant correlation between eating high amounts of trans fats with heart disease and early death?  Absolutely not.  Read the "science" section of the FDA's determinations here, and you will search in vain for any such study.  Instead they rely on a weak chain of logic that could have multiple flaws:  the theory is that there is a correlation between eating trans fats and increased LDL ("bad") cholesterol in the blood, which in turn is correlated with increased risk of heart disease.  Plenty of the commenters to the FDA's proposed rule accused the FDA of cherry-picking studies to claim the correlation between trans fat consumption and higher LDL, and the FDA just responds, "We disagree."  And the link between blood cholesterol and heart disease is weak and has never been established at all for huge sections of the population, for example, women.  So that supports a total ban for the whole population?

Here is Bittman's take on whether a ban is justified:

Why wait three years? Why not get these heart-stopping products off the shelves now, as we do when food is contaminated with E. coli? If the evidence is that trans fats are more harmful than other fats, and other fats exist, why delay? Protecting Big Food’s profits is the only possible answer.

The answer, Mark, is that these people have no idea what they are doing.  They just want the thrill that comes from the feeling of power from ordering other people around.  This isn't remotely like e-coli, which has a near 100% correlation with serious infection.  This is double layers of weak correlation with lots of confounding factors that may be involved and no thorough understanding of the causal mechanism.  The uncertainties are huge and it is entirely possible that this whole thing is completely wrong, just like they were the last time with saturated fat.

Now in my own case, I never liked margarine.  I thought it tasted bad.  And baked goods made with margarine are hugely inferior to those made with butter.  So I won't miss the stuff. 

But lots of people could have good reason to want to buy food made with trans fats.  Baked goods made with margarine are a lot cheaper than those made with butter.  At a supermarket where I shop, the difference can be up to a factor of three.  So this is yet another example of elites unthinkingly imposing a big new burden on lower income people.  Based on essentially no evidence whatsoever.