Archive for March, 2011
‘Medicare Loses Nearly Four Times as Much Money as Health Insurers Make’
The latest from Jeffrey H. Anderson, which I’ll file under I-Wish-I’d-Said-That:
In a newly released report, the Government Accountability Office (GAO) estimates that, in fiscal year 2010, $48 billion in taxpayer money was squandered on fraudulent or improper Medicare claims. Meanwhile, the nation’s ten largest health insurance companies made combined profits of $12.7 billion in 2010 (according to Fortune 500). In other words, for every $1 made by the nation’s ten largest insurers, Medicare lost nearly $4…
Actually, it may have been even worse than that: The GAO writes that this $48 billion in taxpayer money that went down the drain doesn’t even represent Medicare’s full tally of lost revenue, since it “did not include improper payments in its Part D prescription drug benefit, for which the agency has not yet estimated a total amount.”
Courtesy of The Weekly Standard.
Cops on Camera: LAPD Edition
The L.A. Times has an article highlighting the twentieth anniversary of the Rodney King beating and how video of that event introduced the LAPD to modern citizen journalism.
Today, things are far different and the tape that so tainted the LAPD has a clear legacy in how officers think about their jobs. Police now work in a YouTube world in which cellphones double as cameras, news helicopters transmit close-up footage of unfolding police pursuits, and surveillance cameras capture arrests or shootings. Police officials are increasingly recording their officers. Compared to the cops who beat King, officers these days hit the streets with a new reality ingrained in their minds: Someone is always watching.
“Early on in their training, I always tell them, ‘I don’t care if you’re in a bathroom taking care of your personal business…. Whatever you do, assume it will be caught on video,’ ” said Sgt. Heather Fungaroli, who supervises recruits at the LAPD’s academy. “We tell them if they’re doing the right thing then they have no reason to worry.”
That’s progress, and as I’ve said before, a video camera is an honest cop’s best friend.
There’s still plenty of room for improvement. The LAPD paid $1.7 million to a news camera operator injured by its officers at the 2007 May Day melee. LAPD officers have also been caught on camera assaulting a bicyclist and illegally detaining a man for taking photographs on a public sidewalk. You can track police intimidation of citizen journalists at Cop Block’s War on Cameras interactive map, patterned after Cato’s own Raidmap.
Here is the Cato video, Cops on Camera:
For more on cops and cameras, check out the event Cato hosted last year and Radley Balko’s feature at Reason, “The War on Cameras.”
Will U.S. Finally Keep Its Word with Mexico on Cross-border Trucking?
President Obama and Mexican President Calderon announced this afternoon that the U.S. government will finally allow qualified, safety certified Mexican truckers to deliver goods in the United States, fulfilling a commitment our government made more than 17 years ago in the North American Free Trade Agreement. It’s about time.
America’s violation of the agreement had resulted in sanctions against $2.4 billion worth of U.S. exports to Mexico. According to one press report today,
The plan, announced at a news conference by the two presidents, will allow for half of those tariffs to be lifted immediately. It will establish a reciprocal, phased-in pilot program that allows Mexican trucks to operate inside the U.S. provided they comply with a series of safety and driver-skills and language tests monitored by the U.S. Department of Transportation.
Under the NAFTA agreement, the United States and Mexico agreed to allow trucks from each country to deliver goods to destinations inside the other country, provided the trucks met the same safety regulations that apply to domestic truckers. But under pressure from the Teamsters Union, President Clinton refused to implement the program during his presidency.
President George W. Bush, to his credit, tried to fulfill the U.S. obligation under NAFTA. His administration launched a pilot program in 2007, which allowed a limited number of Mexican trucking companies to deliver goods to U.S. destinations beyond the 25-mile commercial zone along the U.S.-Mexican border. Citing unsubstantiated safety concerns, and in the face of ongoing union pressure, a bipartisan majority in Congress voted to cut off funding for the program in 2009.
After years of patiently waiting for its northern neighbor to do the right thing, and after lawfully pursing its grievance through procedures set up by NAFTA, the Mexican government responded to the end of the pilot program by imposing punitive duties on $2.4 billion worth of U.S. exports to Mexico. The duties were strategically aimed at a range of politically sensitive products.
The safety issue was never a valid reason to suspend the program. As we’ve noted at the Center for Trade Policy Studies (time and time again), the NAFTA agreement requires Mexican trucks to meet every safety standard and then some that are imposed on U.S. trucks. Under the pilot program, Mexican trucks actually proved to have a better safety record than U.S. trucks.
Under the NAFTA agreement, President Obama has the authority he needs to bring the United States into full compliance. He should act quickly to bring this embarrassing and damaging episode to an end.
Is the REAL ID Rebellion Coming to Florida?
Until now, Florida has not been one of the states to buck the federal government’s national ID mandate, established in the REAL ID Act of 2005. A pair of grand jury reports in 2002 had moved the state to tighten its driver licensing processes prior to any federal action, so it was already doing many of the things that the Department of Homeland Security is now seeking to require of states in the name of REAL ID.
Full compliance with REAL ID remains a distant hope, so DHS has set out a list of 18 “milestones,” progress toward which it is treating as REAL ID compliance. Full compliance with REAL ID includes putting driver information into a network for nationwide information sharing—including scanned copies of basic identity documents. It includes giving all licensees and ID holders a nationally uniform driver’s license or ID card so their identity can be checked at airports, federal facilities, and wherever the Secretary of Homeland Security determines to have federal checkpoints.
Again, the state of Florida meets DHS’ milestones. Starting from an already strict driver licensing regime, the state’s bureaucrats have been doing (and asking the legislature to do) things that match up with the requirements of the national ID law. But now, thanks to the work of Florida’s Tenth Amendment Center, Floridians Against REAL ID, and others, the legislature is beginning to pay attention.
Why is it so hard for law-abiding citizens and residents of Florida to get or renew their licenses? What kinds of barriers to progress are being thrown in front of lawful immigrants from Haiti, who haven’t the documentation required to get a license and thus a job?
Rep. Geraldine Thompson (D-Orlando) has lived in Florida since 1955 and was elected to the Florida legislature in 2006. She was born in New Orleans and is not able to get a copy of her birth certificate. The Florida Department of Motor Vehicles would not accept her Florida House ID card as proof of her identity!
Several members of the Florida legislature are concerned that the state is scanning and databasing the basic identity documents of Floridians, exposing those documents and the people of Florida to unknown cybersecurity risks. If these databases were hacked, Floridians’ data would be treasure trove for identity fraud. A breach of an entire state’s identity data could collapse the system we now rely on to know who people are. This is not an improvement in security for Floridians.
Florida’s Cuban ex-pat population has some idea of what could result if they were herded into a national identity system. They are too familiar with central government control of access to goods, services, employment, and other essentials of life. Advocates of national ID systems here in the United States have already argued for using REAL ID to control access to employment, to financial services and credit, to medicines, to housing, and more.
In my testimony to the Florida legislature, I noted that the federal government is impotent to enforce REAL ID. The political costs of a DHS attack on air travel (if it refused to recognize drivers’ licenses from non-compliant states at airport checkpoints) would be too high. Indeed, word is spreading that DHS will soon extend the REAL ID deadline once again.
What’s clear from my visit to Florida is that legislators there respond to what they hear from their constituents. It’s unclear what the Florida legislature will do to reassert control of its driver licensing policy from the concerted action of the federal government and its motor vehicle bureaucrats.
One of the questions they might ask is, “Who committed Florida to comply with REAL ID?” That’s item number seventeen in the DHS’ eighteen-point material compliance checklist.
It’s Official: Governors Implementing ObamaCare Are Undermining the Lawsuits
Judge Roger Vinson of the U.S. District Court for the Northern District of Florida has just responded to the Obama administration’s “motion to clarify” his prior ruling, which declared ObamaCare unconstitutional and void. That “motion to clarify” essentially asked Vinson, “Didn’t you really mean that we can keep implementing ObamaCare while we appeal your ruling?” Today, Vinson answered, “No.”
The attorneys representing the plaintiffs, who include Florida and 25 other states, argued that the administration’s “motion to clarify” was actually a veiled request to have Vinson stay (i.e., set aside) his original order blocking implementation. Vinson agreed, and therefore treated the Obama administration’s “motion to clarify” as a motion to stay, which he granted. Vinson made clear, however, that if the administration fails to file a notice of appeal by March 10 or fails to seek an expedited appeal either with the 11th Circuit Court of Appeals or the Supreme Court, then his stay will lift and the administration will (once again) be barred from implementing or enforcing ObamaCare. In other words, Vinson prevented the Obama administration from treating his stay as an excuse to ignore his ruling while the further entrenching the law.
It would have been better if Vinson had stuck to his original order blocking implementation. Yet he made clear that one of the reasons he did not is that many of the states asking him to strike down the law are implementing it anyway. Vinson wrote that the case for blocking implementation:
is undercut by the fact that at least eight of the plaintiff states…have represented that they will continue to implement and fully comply with the Act’s requirements — in an abundance of caution while this case is on appeal — irrespective of my ruling.
As the Obama administration explained to the court:
[S]ince the Court entered its judgment on January 31, at least 24 of the 26 plaintiff states have applied for additional grants authorized or appropriated by the ACA, continued to draw down grant funds previously awarded under the ACA, or otherwise availed themselves of resources made available by the ACA. Indeed, South Carolina has continued to drawn down exchange planning grant funds, even though it has declared the Act “void and unenforceable.” Similarly, Utah has described the declaratory judgment as an “injunction against further implementation” of the Act, but has continued to draw down Pre-existing Condition Insurance Plan (“PCIP”) funds and to request Early Retiree Reinsurance Program (“ERRP”) reimbursements.
Now would be a good time for the South Carolina Gov. Nikki Haley (R), Utah Gov. Gary Herbert (R), and the governors of the other 22 plaintiff states to join Alaska and Florida in refusing to accept any further ObamaCare funds, returning the ObamaCare funds they have already received, and ceasing all implementation activities, including “planning” efforts.
Tea partiers and other conservative groups turned on House Republicans in a dispute over when the House would vote to cut off all ObamaCare spending. Where’s the outrage over the governors and state legislators that are eagerly pursuing that funding, actively implementing the law, and preventing judges from stopping implementation?
Privatizing Public Broadcasting
I appeared on WFPL, the NPR affiliate in Louisville, Kentucky, today to argue for ending the federal funding for NPR and PBS. Sort of like Daniel in the lion’s den. But since I survived, and since NPR stations are using all their government dollars to mount a vigorous radio and internet campaign to get more government dollars, I thought I would pull together some of my writings on the topic.
You should shortly be able to listen to the show here. I made the point that we have a $1.5 trillion deficit, and every spending program has to be on the table. But more importantly, as I said in my article on the top ten reasons to privatize public broadcasting,
And the number one reason to privatize public broadcasting is:
1. The separation of news and state. We wouldn’t want the federal government to publish a national newspaper. Why should we have a government television network and a government radio network? If anything should be kept separate from government and politics, it’s the news and public affairs programming that Americans watch. When government brings us the news—with all the inevitable bias and spin—the government is putting its thumb on the scales of democracy. It’s time for that to stop.
Here’s my testimony to the Senate Appropriations Committee — four public broadcasting CEOs and me — which is actually more balanced than most congressional hearings. This includes data on public broadcasting demographics that I cited on the air.
Here’s the Cato Handbook for Policymakers chapter on “Cultural Agencies.”
Here’s my speech, “The Separation of Art and State,” delivered at the Delaware Center for Contemporary Arts.
Read my reflections on the scandals in public broadcasting here.
Corporations Aren’t People But They Are (Legal) Persons
Recently, activist and filmmaker Annie Leonard released a video titled “The Story of Citizens United v. FEC,” an eight-and-a-half-minute criticism of last year’s Supreme Court case of the same name.
Well, sort of.
Competitive Enterprise Institute’s Lee Doren made his own video critique in response to Ms. Leonard’s offering, and points out quite clearly that Ms. Leonard doesn’t really deal with any actual constitutional problems in her position—essentially ignoring the decision and its rationale—and instead spends most of her time corporation bashing.
Lee was kind enough to cite, inter alia, a blogpost I wrote last year about what “corporate personhood” does and does not mean. If Ms. Leonard was going to ignore the decision, it may have at least served her well to read that post before producing her video. As I pointed out, under the logic she puts forth, “individuals acting through corporations should be denied their freedom of speech because corporations are ‘state-created entities.’ The theory goes that if a state has the power to create corporations, then it has the power to define those entities’ rights.” Ms Leonard’s video was made by (or coordination with) Free Range Studios—a corporation—and thus she’s making the argument that Congress should be able to keep her from or punish her for making that video because Free Range Studios shouldn’t have rights.
Despite the misinformation in Ms. Leonard’s video, we believe she and Free Range Studios have every right to be wrong as publicly as they see fit, even if she doesn’t.
Please watch Lee’s full video below, and look for the Cato shout-out around the 12:20 mark. If you’re in the Chicagoland area, I’ll be speaking about corporate rights and corporate personhood at John Marshall Law School tomorrow at 10:15AM local time. Feel free to stop by and please introduce yourself.
For a Dollar
The Crossed Pond has long been one of my favorite blogs. Here’s a recent post I liked a lot:
I belatedly realized that I needed a calculator today so after quick stop by a gas station to try my luck, I ended up in my local Walmart. I was in a bit of hurry so I asked a very nice lady where I could find the calculators and was pleasantly surprised when it was much closer than where I would have gone if I didn’t ask. I made my way to the aisle and pondered my options. Because it looked to be a familiar style, I grabbed a Casio that was priced at $4.97 and was just about to double back to the registers when I noticed something on the top shelf that had exactly the same features like memory recall but was priced at a mere dollar. I quickly exchanged the one that was priced five times higher and headed out.
As I sat admiring my new purchase a few minutes later, I was struck by just how amazing this little piece of hardware really was. It’s about 20% bigger than a credit card and is encased in a rather attractive translucent case. This translucency allowed me to notice the interior guts of the calculator and got me thinking. Within the price point of a dollar, this little device had somehow managed to include an eight digit liquid crystal display, a little solar panel, a battery, a pcb board with attached cables from the buttons to the board and from the board to the screen, a system of buttons and a backing for them that transmits their signal and of course actual calculator microchip itself. It doesn’t have the largest of screens or the biggest battery and the whole device is only about half an inch thick at the thickest point. Yet it’s got nice soft buttons that do things accurately on the screen when I press them. Yet somehow, this marvel was able to be sold to me for a dollar.
That dollar includes all of the hardware physically inside of it. It also includes the cost of all of those who handled this device on its journey to me. Aside from manufacturing and the initial assembly, portions of that dollar were spent on transporting this all the way across the Pacific and then inland from container box to semi truck to the back area of Walmart where someone actually unpacked it and put it on the shelf for me to buy. This was all done for less than 100 pennies. Think about that for a moment.
Ain’t modern life grand?
Now, when people on the left hear me say things like this, they often seem to conclude that I must be speaking in code.
What I must be saying — truly, deep down — is that the poor should be happy with what they have. That all great concentrations of wealth are held justly and should be preserved as national treasures. That ours is the best of all possible worlds. And that you should all vote Republican.
Surely this is the most probable interpretation, right? I mean, what else could it be? Pocket calculators are so pedestrian. They’re not grand. They don’t make big explosions. They don’t last forever. They don’t even impress the neighbors. Pocket calculators are the most non-monumental objects around.
Rivkin and Casey on Obama and DOMA
David B. Rivkin Jr. and Lee A. Casey, prolific conservative lawyer-writers, have an op-ed in the Wall Street Journal deploring President Obama’s decision not to defend the constitutionality of Section 3 of the Defense of Marriage Act. They write:
DOMA posits that the definition and regulation of marriage has always been a state issue….DOMA recognizes and protects the unique constitutional role of the states in deciding these issues.
And the subhead, which of course they didn’t write and may not have seen, emphasizes,
DOMA leaves the issue of gay marriage to the states, which is exactly where it belongs.
But there’s a problem here. As they well know, Section 3 of DOMA is the most controversial part, and it precisely does not leave marriage to the states. It says:
In determining the meaning of any Act of Congress, or of any ruling, regulation, or interpretation of the various administrative bureaus and agencies of the United States, the word ‘marriage’ means only a legal union between one man and one woman as husband and wife, and the word ‘spouse’ refers only to a person of the opposite sex who is a husband or a wife.
That is, the federal government for the first time said in 1996 that it would not recognize marriage licenses lawfully issued by the several states but rather would override state decision-making on marriage in favor of a uniform national rule as it pertains to taxes, immigration, benefits, and other federal issues. Surely that was an unprecedented intervention into state authority over marriage (save for the Loving decision that barred the states from banning interracial marriages).
And also, as the authors know, the very first sentence of Attorney General Holder’s letter to Speaker Boehner read, “the President of the United States has made the determination that Section 3 of the Defense of Marriage Act (“DOMA”), 1 U.S.C. § 7, as applied to same-sex couples who are legally married under state law, violates the equal protection component of the Fifth Amendment.” Yet the article, deploring the administration’s action, ignored Section 3, the precise section of DOMA at issue.
There’s a respectable federalist case for Section 2 of DOMA, which guarantees that no state will have to recognize a same-sex marriage made in another state. (There’s also a respectable constitutional case for applying the logic of the Loving case to the question of gay couples seeking to marry, as Cato chairman Bob Levy argued in the Washington Post.) But Section 3 of the act, the section that Obama and Holder consider unconstitutional, is not federalist, it is centralist. Rivkin and Casey should at least have addressed that point, rather than criticizing the president by dodging the actual issue at stake.
Footnote: Rivkin and Casey have done noble work recently in defense of limited government and federalism with regard to President Obama’s health care law. And in 2006 they warned conservatives against taking marriage law out of the state legislatures and enshrining rules in state constitutions. It’s too bad they didn’t bring the same acuity to their analysis of DOMA and the president’s bold but narrow decision.
Corruption from Sea to Glistening Sea
Last night, the Seattle Public School Board fired the district’s superintendent as well as its chief financial and operations officer after the local media uncovered a multimillion dollar fraud spree that had gone unchecked for years. In the opposite corner of the nation, a grand jury has just found that the Broward County Public School Board “wasted hundreds of millions” while “doing the bidding of a select group of contractors and lobbyists.” The grand jury’s preferred recommendation would have been to “abolish the… School Board altogether,” but Florida’s constitution mandates its existence.
Why are waste and fraud so common in the nation’s public school systems, and what can we do about it? One of the most compelling answers I’ve ever seen to those questions can be found in a letter written by… a corruption prosecutor. He was born in the early sixties, and the tiny town where he grew up still didn’t have its own high school—so he decided to found one himself. Rich guy. He could have afforded to not only build it, but also to fully endow it so that tuition would be free. Instead, he decided to cover only a third of the operating costs. In a letter to a friend, he explained his decision:
I would promise the whole amount were I not afraid that someday my gift might be abused for someone’s selfish purposes, as I see happen in many places where teachers’ salaries are paid from public funds. There is only one remedy to meet this evil: if the appointment of teachers is left entirely to the parents, and they are conscientious about making a wise choice through their obligation to contribute to the cost. People who may be careless about another person’s money are sure to be careful about their own, and they will see that only a suitable recipient shall be found for my money if he is also to have their own… I am leaving everything open for the parents: the decision and choice are to be theirs—all I want is to make the arrangements and pay my share.
What’s particularly interesting about this letter is that its author was born in the early sixties…. Not the 1960s… or the 1860s… the early 60′s of the first century A.D. The author was Pliny the Younger, and he was writing to his friend Tacitus.
Though Pliny was basing his analysis on his personal and professional experiences, it is born out by a wealth of modern econometric research. Schools paid for at least in part directly by parents are consistently more efficient and responsive to their demands.
Learning Liberty
The Institute for Humane Studies recently launched LearnLiberty.org, a project aimed at providing videos of varying length that educate on basic economic concepts and philosophy rooted in individual liberty. Cato’s Jeffrey A. Miron is among the faculty featured.
More videos are coming. Check it out.
Hate the Deception, Not the Teacher
This morning the New York Times ran one of those stories that just drives me nuts. You know, one of those articles that’s packed full of anecdote; sad, beleaguered victims of societal cruelty; and a gaping vacuum where balancing facts should be found.
I’m referring to “Teachers Wonder, Why the Scorn?” which suggests that broad, angry swaths of Americans hate teachers. Of course, it offers almost no actual evidence of that save an angry email one teacher received. Indeed, the article cites polling data that greatly belies the point.
Worse than this is that the article contains incredibly deceptive — but all too standard — reporting on teachers’ compensation, ignoring that teachers’ salaries are based on much shorter working hours than are those of most other professionals. And this is to say nothing of public-school teachers’ typically very nice benefits packages — the main concern when it comes to crumbling state budgets. So we read with a tear in our eyes of the situation of Erin Parker, a second-year teacher in Madison, WI earning $36,000 a year plus benefits. Her situation is so desperate, we’re told, that she is contemplating moving back to Colorado so she can live, presumably rent-free, with her parents.
So what does Ms. Parker make per hour, the best assessment of her pay? (We’ll leave aside the very big, but harder to calculate, matter of benefits.) According to the Madison CBA, Ms. Parker is required to work 182 days (the requirement after the first year of teaching). She also is required to be at school from 8:00 am to 4:00 pm — slightly longer than most teachers typically work, including time spent working outside of contracted hours. A recent “time diary” analysis pegged total working hours per school-week at slightly less than 40.
So, multiply 8 by 182 and you get 1,456 hours per year. Divide $36,000 by that and Ms. Parker’s hourly wage is $24.73.
What would that look like for a standard, 2,000 hours worked per year (40 hours per week for 50 weeks)? $49,460. That’s certainly not riches, but it comes very close to Wisconsin’s 2008 median household income of $52,103. That’s not too bad for a single person, which is probably something many taxpayers intuit when they rightly note how much time teachers have off.
Of course, we are also told that Ms. Parker has $26,000 in student loans. We’re not told how she got them, but the amount exceeds the 2010 average debt of $23,186, and we don’t know what school(s) she attended, how she spent her time, etc. At least as important as knowing the “why” of her debt, the article also ignores that paying it back is quite possible given her salary and hours. I won’t go into the details of that here, but I lay it out in this 2008 Policy Analysis.
Now, is any of this to say some teachers aren’t paid too little? Absolutely not, but you need a market to determine who should get paid what because value ultimately depends on what people are voluntarily willing to pay for your services. Unfortunately, in large part at the behest of the unions — and it is the unions, not the teachers, who are most often held in contempt – teachers generally all get paid on the same schedule. So if Ms. Parker is a great teacher – and I have no reason to believe she isn’t – she might very well deserve to get paid more. But she shouldn’t blame the public for her pay — she should blame her union.
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