Archive for October, 2011
Heritage Scholar Urges States: Don’t Implement ObamaCare Exchanges, Send Back Grants
Back in March, Heritage Foundation scholar Ed Haislmaier wrote that states could blunt ObamaCare’s impact (A) by creating non-ObamaCare compliant, “consumer-centered” Exchanges and/or (B) by creating ObamaCare-compliant, “defensive” health insurance Exchanges. Many states, including some that are suing to overturn ObamaCare as unconstitutional, saw this as a green-light from the free-market groups and forged ahead with creating an ObamaCare-compliant Exchange.
In a blog post last week, Haislmaier recanted on Strategy B. He writes that “defensive” Exchanges won’t blunt the impact after all, and that states should refuse to create any type of ObamaCare-compliant Exchange and send back all federal ObamaCare grants:
Initially, while HHS was still deciding how to implement the legislation, a narrow window of opportunity existed for states to pursue a “pushback” strategy of creating a restricted exchange and requiring it to contract with the state’s Medicaid program and insurance department to perform the eligibility, enrollment, and insurance regulation functions that state lawmakers seek to retain control of. HHS effectively closed that window in its proposed exchange regulations issued in July…
The combined effect of these regulations and grant requirements are that a state would have to agree to surrender any last vestiges of meaningful control over how Obamacare is implemented. Thus, a state would now have no more real control over an exchange it set up than over one HHS established…
Consequently, at this point the best course of action for states is to neither apply for nor accept exchange establishment grant funding.
Free-market groups are now united on these points.
Haislmaier still recommends that states pursue Strategy A: a “consumer-centered,” non-ObamaCare Exchange using only state-government dollars. As I explain here, however, there is no such thing as a non-ObamaCare Exchange. Insurance carriers will not patronize non-ObamaCare Exchanges, and the federal government will commandeer them or push them aside to create an ObamaCare Exchange. Creating any type of Exchange merely lends manpower to ObamaCare’s federal takeover of health care. States should refuse.
Transparency and Its Discontents
Remember when you had to wait until the end of the month to see your bank statement?
Last week, on the cusp of failing to pass any annual appropriations bills ahead of the October 1 start of the new fiscal year, congressional leaders came up with a short-term government funding bill (or “continuing resolution”) that would fund the government until November 18th. For whatever reason, that deal (H.R. 2608) wasn’t ready to go before the end of the week, so Congress passed an even shorter-term continuing resolution (H.R. 2017) that funds the government until tomorrow, October 4th.
Every weekend, I hunch over my computer and update key records in the database of WashingtonWatch.com, a government transparency website I run as a non-partisan, non-ideological resource (disclosure: it’s my own, not a Cato project). Then I put a summary of what’s going on into an email like this one (subscribe!) that goes out to 7,000 or so of my closest friends.
Last weekend, the Library of Congress’ THOMAS website, which is one of my resources, was down a good chunk of the time for maintenance. Even after it came up again, some materials such as bill text and committee reports weren’t available. (They had come up by the wee hours this morning.) Maintenance is necessary sometimes, though when the service provider I use for the WashingtonWatch.com email does maintenance, it’s usually for an hour or so in the middle of a weekend night.
But when I went to update the database to reflect last week’s passage of H.R. 2017, I could find no record of its public law number. When a bill becomes a law, it gets a public law number starting with the number of the Congress that passed and then a sequential number, like Public Law No. 112-29. The Government Printing Office’s FDsys system lets you browse public laws. At this writing, it isn’t updated to reflect the passage of new laws last week. When THOMAS came back up, its public laws page also had no data to reflect the passage of that continuing resolution last week (and still doesn’t, also at this writing).
There is barely any news reporting on humdrum details about governing like the passage of a law expending $40 billion in taxpayer funds. (That’s about what H.R. 2017 spends to operate the government four more days, roughly $400 per U.S. family.) Where can you confirm with an official source that this happened?
The winning data resource this week, if by default, is Whitehouse.gov, which has a page dedicated to laws the president has signed. That page says that President Obama signed four new laws on Friday (Sept. 30). When might FDsys or THOMAS reflect this information? It’ll happen soon, and that data will start to propagate out to society.
But I think that’s not soon enough. A couple of days’ delay is a big deal.
If I were to take $400 in cash out of my bank account at an ATM, I could review that transaction from that instant forward on my bank’s website. If I had a concern or even a passing interest, I could just go look. That is an utterly unremarkable service in this day and age.
But it’s remarkable that such a service doesn’t exist in systems that are as important as our bank accounts. When Congress and the president pass a bill to spend $40 billion dollars, the fact of its passage is pretty much undocumented by any official sources until enough Mon-Fri, 9-to-5 work hours have passed.
In my recently published paper, Publication Practices for Transparent Government, I go through the things the government should do to make itself more transparent (thus improving public oversight and producing lots of felicitous outcomes). A practice I cite is “real-time or near-real-time publication.” Why? Because then any of the 300 million Americans who have an interest, real or passing, can see what is happening with their money as it happens, just like they can with their bank holdings. People like me (and many more) can propagate complete and timely information, making it that much more accessible.
When you’re talking about a potential audience of 200 million people and $40 billion in expense (one of the tiniest spending bills—others are much larger), it is not too much to ask to have the data published in real time.
I don’t expect a lot of people to join me at the barricades with pitchforks and torches on this one. Government transparency is an area ruled by implicit demand. People don’t know what they are missing, so they don’t know to suffer a sense of deprivation. I do that for them—all of them. (Heroic, idn’t it?)
Before too long, though, the government’s opacity will be recognized as a contributor to the public’s general—and strong—distaste for all that goes on in Washington, D.C. The idea of spending $400 per U.S. family without documenting every detail of it on the Internet will seem as absurd as waiting until the end of the month to see what happened in your bank account.
Penn & Teller Tell a Lie
Cato Mencken Fellows Penn Jillette and Teller launch a new hour-long show, “Penn & Teller Tell a Lie,” on the Discovery Channel this Wednesday at 10 p.m. Eastern and Pacific Time. Discovery says:
Penn & Teller bring their unique vision of the world in a new interactive series with a twist. In each episode, Penn & Teller make up to seven outrageous claims. While most of the wildly unbelievable stories are absolutely, positively true – one of them is a BIG FAT LIE. It will be up to viewers to spot the fake and VOTE LIVE online or with the new GUESS THE LIE app.
They’ll put lots of scientific claims and myths through rigorous testing, continuing their longstanding interest in science, truth, and skepticism.
If you have a DVR, note that Showtime is rebroadcasting an episode of their former series, this one a skeptical look at the environmental movement, at the exact same time: 10:30 p.m. Wednesday.
And if you can’t wait till Wednesday, listen to Cato’s podcast with Penn Jillette recorded a few weeks ago.
New Video Shows the War on Poverty Is a Failure
The Center for Freedom and Prosperity has released another “Economics 101″ video, and this one has a very powerful message about the federal government’s so-called War on Poverty.
As explained by Hadley Heath of the Independent Women’s Forum, the various income redistribution schemes being imposed by Washington are bad for taxpayers — and bad for poor people.
The video has a plethora of useful information, but the data on the poverty rate is particularly compelling. Prior to the War on Poverty, the United States was getting more prosperous with each passing year and there were dramatic reductions in the level of destitution.
But once the federal government got involved in the mid-1960s, the good news evaporated. Indeed, the poverty rate has basically stagnated for the past 40-plus years, usually hovering around 13 percent depending on economic conditions.
Another remarkable finding in the video is that poor people in America rarely suffer from material deprivation. Indeed, they have wide access to consumer goods that used to be considered luxuries – and they also have more housing space than the average European (and with Europe falling apart, the comparisons presumably will become even more noteworthy).
The most important message of the video, however, is that small government and economic freedom are the best answers for poverty. As Hadley explains, poor people can be liberated to live meaningful, self-reliant lives if we can reduce the heavy burden of the federal government.
Last but not least, the video doesn’t address every issue in great detail, and there are three additional points that should be added to any discussion of poverty.
- The biggest beneficiaries of the current system are the army of bureaucrats that receive very comfortable salaries administering various programs.
- The Obama Administration is looking to re-define poverty in a way that would expand the welfare state and increase the burden of redistribution programs.
- The welfare reform legislation of the 1990s was a small step in the right direction because it eliminated a federal entitlement and shifted responsibility back to the state level. This success story should be replicated for programs such as Medicaid.
This last point is worth emphasizing because it is also one of the core messages of the video. The federal government has done a terrible job dealing with poverty. The time has come to get Washington out of the racket of income redistribution.
Awlaki and Due Process
The administration argues that suspected al Qaida terrorists – even U.S. citizens – can be targeted for assassination because they either (a) pose an imminent threat or (b) are part of an enemy army; and (c) other governments are unwilling or unable to act. Although the Fifth Amendment ensures that persons not be denied due process, it’s unclear what process is “due” – especially when the person is a citizen. For example, a U.S. citizen who threatens hostages with imminent loss of life can be killed by law enforcement authorities. Similarly, an American who serves in a foreign army against which the United States is at war is plainly a legitimate target.
Moreover, under the Nationality Act, a citizen can lose his citizenship if he intends to do so (although intent can be inferred by actions) and he either (a) declares allegiance to a foreign state, (b) serves in a post requiring such a declaration, (c) serves in armed forces in combat with the United States, or (d) serves as an officer or NCO in the armed forces of a foreign state.
Still, the killing of Awlaki is a close legal call. On balance, it’s probably unlawful. The imminent-threat contention isn’t credible. To my knowledge, no one has identified a threat that is imminent (meaning: about to happen). The part-of-an-enemy-army claim and the loss-of-citizenship argument raise several questions: First, is the Nationality Act itself constitutional? The Constitution establishes criteria for citizenship. Stripping someone of citizenship effectively changes those criteria, and Congress may not have that power. Second, even if the Nationality Act is constitutional, does al Qaida qualify as a foreign state for purposes of the Act? Are al Qaida agents equivalent to soldiers engaged in combat with the United States? Third, even if the Nationality Act might apply in Awlaki’s case, how do we know that he triggered the provisions of the Act? Can the administration simply assert that he met one of the tests for loss of citizenship, or must there be some threshold process to make that determination?
Finally, the Authorization for the Use of Military Force sanctioned force against those involved in the 9/11 tragedy. Awlaki, although not directly involved, probably qualified as part of an “associated force”; but actions that might self-evidently be lawful if Awlaki were actively fighting on a battlefield are less so when he’s allegedly plotting attacks from Yemen.
All told, when U.S. citizens are targeted, I’d be more comfortable with somewhat more process – not a trial before an Article III court, of course, but perhaps the equivalent of an assassination warrant that required a non-executive-branch body with relevant expertise to certify sufficient cause. Anything less risks disrespect for the Constitution, which could have regrettable implications in other areas. The separation of powers doctrine, if it means anything, stands for the proposition that citizens cannot be killed on command of the executive branch alone, without regard to the Fourth and Fifth Amendments. Naturally, exceptions are justified for truly imminent threats. If I were convinced that involvement of another branch might result in Awlaki-types escaping punishment, I’d be more willing to invoke “emergency” powers – similar to hot pursuit – but not in this case.
Happy Fiscal New Year (with an Unhappy Obama Hangover)
Today, October 1, is the first day of the 2012 fiscal year.
And if you’re wondering why America’s economy seems to have a hangover (this cartoon is a perfect illustration), it’s because politicians had a huge party with our money in FY2011.
We don’t have final numbers for the fiscal year that just ended, but let’s look at the CBO Monthly Budget Report, the CBO Economic and Budget Update, and the OMB Historical Tables, and see whether there’s anything worth celebrating.
- The federal government spent about $3.6 trillion in FY2011, more money than any government has ever spent in a 12-month period in the history of the world.
- The FY2011 budget is nearly double the burden of federal spending just 10 years earlier, when federal outlays consumed “only” $1.86 trillion.
- The federal budget in FY2011 consumed about 24 percent of national output, up sharply compared to a spending burden in FY2001 of “just” 18.2 percent of GDP.
- Defense spending is too high, and has increased by about $400 billion since 2001, but the vast majority of the additional spending is for domestic spending programs.
- Federal tax revenue in FY2011 will be about $2.25 trillion, an increase of 7-8 percent over FY2010 levels.
- Economic stagnation has affected tax revenues, which are lower than the $2.6 trillion level from FY2007.
- Federal receipts amount to about 15.3 percent of GDP, below the long-run average of 18 percent of GDP.
- The Congressional Budget Office does predict that revenues will rise above the 18-percent average – without any tax increases – by the end of the decade.
- Record levels of government spending, combined with low revenues caused by a weak economy, will result in a $1.3 trillion deficit.
- This is the third consecutive deficit of more than $1 trillion.
- The publicly-held national debt (the amount borrowed from the private sector) is now more than $10 trillion.
With budget numbers like these, no wonder America has a fiscal hangover.
And let’s be blunt about assigning blame. Yes, Obama has been a reckless big spender, but he is merely continuing the irresponsible statist policies of his predecessor.
Fortunately, there is a solution. All we need to do is restrain the growth of federal spending, as explained in this video.
But we also know that it is difficult to convince politicians to do what’s right for the nation. And if they don’t change the course of fiscal policy, and we leave the federal government on autopilot, then America is doomed to become another Greece.
The combination of poorly designed entitlement programs (mostly Medicare and Medicaid) and an aging population will lead to America’s fiscal collapse.
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