Archive for the ‘Government and Politics’ Category
Repeat after Me: There Is No Health Reform but ObamaCare
Here’s a poor, unsuccessful letter I sent to the editor of Politico:
An item in Politico’s health care newsletter Pulse [“Today: Christie Vetoes Exchange Or Else,” May 10] told readers that, because I oppose ObamaCare, I am a “health reform foe.”
Is that what Politico gleans from my conversations with its reporters about the need for health care reform, and how I would go about it? From the hundreds of articles and opeds and speeches and blog posts in which I detail my preferred reforms? And from the book I coauthored about how to reform health care? Is it Politico’s editorial policy that one cannot support health reform without supporting ObamaCare?
Other news organizations, moreover, avoid describing ObamaCare as “reform,” a term that connotes improvement. Is it Politico’s editorial policy to convey to readers that ObamaCare is an improvement?
By Edict of King Andrew, New York Employers Will Be Subject to ObamaCare’s Employer Mandate
Here’s a poor, unsuccessful letter I sent to the editor of the New York Times:
When Gov. Andrew Cuomo (D) created a new ObamaCare “exchange” by executive order, it was indeed “A Deft Health Care Move” [Apr. 18].
Really, what was he supposed to do? Let legislators decide whether to commit taxpayers to such an expense? (They had declined.) Sit back and let the federal government pay for its own Exchange? (That was the alternative.) Block a $3,000-per-worker tax on employers? (Had Cuomo done nothing, New York employers would have been exempt from ObamaCare’s “employer mandate.”)
Cuomo brilliantly and single-handedly volunteered New Yorkers to pay for a new government bureaucracy and burdened New York employers with a new, job-killing tax. Who needs a legislature!
Getting Serious about Fixing Washington
Demonstrating once again that it’s nothing if not the voice of the capital’s establishment, the Washington Post this morning opened its Sunday “Outlook” section with yet another major piece by establishment apologists Norman Ornstein (AEI) and Thomas Mann (Brookings), lamenting our “dysfunctional” politics and blaming it mostly on “extremist” Republicans who oppose “almost everything put forward by the Democrats.” Only three weeks ago the Post splashed a companion piece by the two across that Sunday section, “Let’s just say it: The Republicans are the problem.” And in the interim, Post associate editor Robert Kaiser wrote a glowing review of their new book on “the new politics of extremism” while several Post bloggers were pushing their thesis in their own posts. It must be an election year. (For a legal analogue of the Ornstein/Mann political thesis, see my “When All Is Politics, Nothing Is Law,” posted late Friday by the Daily Caller.)
Having set forth their critique three weeks ago, Ornstein and Mann today list five things that “won’t fix Washington” and four things that will. Four of the five that “will never work,” they say, are a third party, term limits, a balanced-budget amendment, and public financing of elections to restrain special interests. Read and judge for yourself whether their arguments are sound. They begin that fourth point, for example, by noting that “in the post-Citizens United world, the financing of political campaigns is a nightmare.” True, but the constitutional principles upheld by Citizens United aside, it seems not to have occurred to them that the welter of restrictions that they and others of their persuasion have promoted over the years go far toward explaining that nightmare.
The four things Ornstein and Mann believe will work begin, no surprise, with “realistic” campaign finance reform, including more disclosure and stricter enforcement of current law. From there they move on to redistricting reforms, restricting the Senate filibuster rules, and expanding the electorate by, among other things, fining or rewarding citizens so more will go to the polls, the idea being that “boosting overall turnout would help tilt the balance back toward where most Americans actually are: closer to the middle.” The upwards of half of all Americans who don’t vote are “closer to the middle”? If you’ve ever seen Jay Leno’s “man-on-the-street” interviews, you may want to question that—and question too whether encouraging such people to vote will solve many problems.
Here too, judge for yourself concerning all of those essentially structural proposals that Ornstein and Mann believe won’t and will work to correct our dysfunctional politics. I’ve saved for last the fifth of the things they say will never work because, in truth, it’s not really a structural proposal, like the others, but rather a perspective—and it leads to substantive issues that establishment people like Ornstein and Mann seem not to want to address. Their suggestive heading for this fifth thing that won’t work is “Stay calm—things will get back to normal eventually.” Those of this view argue that “acrimony and gridlock are built-in features of our political system” that wax and wane, Ornstein and Mann write; thus the 111th Congress “was extremely productive, passing health-care reform, financial regulation and an economic stimulus package.” They counter, however,
that an examination of the Obama presidency suggests that we are experiencing neither politics as usual nor an odd blip. We are witnessing unprecedented and unbalanced polarization of the parties, with Republicans acting like a parliamentary minority party opposing almost everything put forward by the Democrats; the near-disappearance of the regular order in Congress; the misuse of the filibuster as a weapon not of dissent but of obstruction; and the relentless delegitimization of the president and policies enacted into law.
Indeed, they contend that with “the defeat of problem-solvers such as Sen. Richard G. Lugar (R-Ind.) and the emergence of take-no-prisoners partisans such as Richard Mourdock, there is no reason to think the system will correct itself anytime soon.”
The thing to note in all of this is just what Ornstein and Mann count as “normal”—it’s government as “problem solver,” Congress as “extremely productive.” But that’s precisely the vision of government that is under assault today—and has been at least since Barry Goldwater challenged the “get-along, go-along” Republican establishment in 1964. Yet in truth that post-New Deal world that the establishment so longs to return to was the anomaly. We have “gridlock” today because the post-Goldwater challenge has finally reached critical mass. And that’s what the Washington establishment has yet to grant—witness its dismissal of Goldwater, its initial dismissal of Ronald Reagan, and its dismissal today of the Tea Party.
Still, it’s not problem solving as such that these anti-establishment “obstructionists” oppose—indeed, there’s no shortage of problems to be solved. Rather, it’s doing so through the big-government “solutions” that have given us those problems to begin with. Whatever the merits of the structural reforms establishment types like Ornstein and Mann are offering, their critique hardly explains our dysfunctional politics. Now that the opposition has reached critical mass, it’s increasingly clear that we have gridlock because the nation is deeply divided not over structure but over substance—over the very role of government. The establishment’s faith in government—in what are essentially public “solutions” to private problems, the core of progressivism—is under assault as never before, because that faith has come up dry. It’s long past time for the establishment to grasp that, because the reality that so animates the opposition—the ever growing deficits and debt the progressive faith has produced—is fast closing in upon us. And the inability of the Washington establishment to deal with it, except through more of the same government schemes that produced it, is the dysfunction that should most concern us all.
The Wall Street Journal’s Limited-Government Readers
The Wall Street Journal editorial page, usually a strong voice for limited government, was rapped by readers Thursday for positions that didn’t seem to meet that standard.
After the Journal urged President Obama to support the Defense of Marriage Act in order to allow the gay marriage issue “to be resolved democratically by the states,” Michael Weisberg wrote to point out that DOMA “overrides the laws and desires of the states, which have traditionally had jurisdiction in matters of marriage, as one would expect under the federal Constitution.” That’s a point we’ve also made here, and one that seems to confuse many of DOMA’s advocates.
Meanwhile, many readers objected to the Journal‘s support for the Census Bureau’s American Community Survey (also a point we’ve made in this space). Adam Marcus and Berin Szoka of TechFreedom noted that Census data aren’t as private as we’re promised:
Our government has abused census data to awful effect, most notably in the internment of Japanese-Americans during World War II, as documented in a Scientific American article in 2007. More recently, the feds violated their express privacy policy by publishing all individual responses to the 1940 Census’s similarly extensive questions—not just aggregated results.
Like Robert L. Umbarger, they also point out that “the Constitution authorizes a census only to apportion congressional representatives,” so the government exceeds its authority when it requires Americans to answer questions on, as the Journal put it, “everything from demographics to income to commuting times.” Lisa Greenman reflects a traditional American suspicion of government:
At worst it is the federal government collecting private, personal data that can be used against its citizens. How ironic this piece was published under the one titled “The President’s Hit List.”
Van Bussmann notes, “Here comes yet another program to solidify government control over our lives. Information begets power.” He unconsciously echoed Sir John Cowperthwaite, the former administrator of the British colony Hong Kong during its rapid rise from poverty, about whom the Journal editorial page wrote in 2006, “One of the better known stories about the undeservedly obscure Cowperthwaite was his refusal to collect economic statistics about Hong Kong during his tenure as Financial Secretary, lest they produce an impulse toward central planning among the bureaucrats.”
It’s good to know that even when the Journal editorial writers are tempted by unwarranted federal programs, their readers are on the case.
Daniel in the Looter’s Den: My Adventures at the UN
I was at the United Nations yesterday for something called “The High Level Thematic Debate on the State of the World Economy.”
Most speakers, including the secretary general of the United Nations, the president of the European Commission, Paul Volcker, and Joseph Stiglitz, to varying degrees blamed private markets for the fiscal and financial problems of the world. Not surprisingly, there also was a consensus for more government—usually wrapped up in buzzwords such as “sustainable development” and “equitable growth” and ”coolective action”
I spoke in the afternoon as part of a roundtable on the economic crisis (see full schedule here). There were five speakers on my panel, including yours truly. Here are my thoughts on what the others said.
Dr. Supachai Panitchpakdi, secretary-general of the United Nations Conference on Trade and Development, must have been part of the buzz-word contest I mentioned yesterday. Lots of rhetoric that theoretically was inoffensive, but I had the feeling that it translated into a call for more government. But maybe I’m paranoid, so who knows.
Professor Dato’ Dr. Zaleha Kamaruddin, rector of the International Islamic University of Malaysia, was an interesting mix. At some points, she sounded like Ron Paul, saying nice things about the gold standard and low tax rates. But she also called for debt forgiveness and other forms of intervention. She explicitly said she was providing Islamic insights, so perhaps the strange mix makes sense from that perspective.
Former U.S. senator Alan K. Simpson also was a mixed bag. Simpson was co-chair of President Obama’s fiscal commission, which I thought was a disappointment because it endorsed higher taxes and urged subpar entitlement changes rather than much-needed structural reforms. He also went after Grover Norquist because of the no-tax pledge, which I think is a valuable tool to keep Republicans from selling out for bigger government. All that being said, Senator Simpson is a promoter of smaller government and he wants lower tax rates. So while I disagree with some of his tactical decisions, he was an ally on the panel and would probably do a pretty good job if he was economic czar.
Last but not least, Professor Jeffrey Sachs of Columbia University was a statist, as one would expect based on what I wrote about him last year. We clashed the most, arguing about everything from tax havens to the size of government. Interestingly, we both said nice things about Sweden, but I was focusing on policies such as school choice and pension reform, while he admired the large public sector. But I will admit he was a nice guy. We sat next to each other and did find a bit of common ground in that we both were sympathetic to the way Sweden dealt with its financial crisis about 20 years ago (a version of the FDIC-resolution approach rather than the corrupt TARP bailout approach).
My message, by the way, was very simple: Higher taxes won’t work. The “growth” vs. “austerity” debate in Europe is really a no-win fight between those who want higher spending vs. those who want higher taxes. The only good answer is to restrain spending with—you guessed it—Mitchell’s Golden Rule.
The good news is that I wasn’t tarred and feathered. Indeed, I even got a modest amount of positive feedback. The bad news is that I doubt I moved the needle.
But at least the United Nations was willing to have contrary voices, unlike the Organization for Economic Cooperation and Development, which once threatened to cancel a Global Tax Forum because of my short-lived participation.
Yes, the IRS Can Use Liens and Incarceration to Enforce ObamaCare’s Individual Mandate
Here’s a poor, unsuccessful letter I sent to the editor of the Washington Post:
A recent article [“Could the health-care law work without the individual mandate?”, Mar. 28, A8] claims the IRS “will be barred from using … collection tools such as placing liens or threatening incarceration” to enforce compliance with the requirement that Americans obtain health insurance. Not so.
Suppose the IRS assesses me a $1,000 penalty for failing to obtain health insurance. It is true that the law prohibits the IRS from using liens or incarceration to collect that $1,000. But, money being fungible, the IRS may simply deem my first $1,000 of income-tax withholding to be payment of that penalty. As a result, I would owe an additional $1,000 in income tax at the end of the year, and the IRS could come after me with every tool at its disposal, including liens and incarceration.
You Do Know What Makes It a ‘Free’ Market, Right?
Here’s a poor, unsuccessful letter I sent to the editor of the Washington Post:
“Health-care provision at center of Supreme Court debate was a Republican idea” [Mar. 27, A7] describes the health care law Mitt Romney signed while governor of Massachusetts as comprised of “free-market ideas.” Really?
RomneyCare’s individual mandate, now mirrored in ObamaCare, uses the power of the state to compel people to health insurance. What could be more un-free than that?
If Thomas Edison Had to Submit His Innovations to Medicare, You Would Be Reading This by Candlelight
Two articles in the Washington Post sparked these two poor, unsuccessful letters to the editor. First this:
I’m no Republican, but “‘Innovation advisers’ chosen for ideas to improve health care, cut costs” [Jan. 21] gives short shrift to those who oppose the new health care law’s Center for Medicare and Medicaid Innovation when it reports, “Some Republicans have questioned the value of investing in experimentation to produce results at a time of limited resources.”
If some critic of the law actually said, “Resource limitations prevent us from investing in innovations that stretch resources further,” please do print it. I could use the laugh. But that’s not why critics oppose the Center.
The argument against the health care law’s efforts to promote innovation is that they won’t work. The Congressional Budget Office recently reported that out of dozens of supposed Medicare innovations, only one met its goal of saving taxpayers money. That pilot program ended 16 years ago. Medicare has yet to adopt it program-wide.
This is an important debate. Readers deserve to hear both sides, not caricatures.
And then this:
Recent coverage of the new health care overhaul [“‘Innovation advisers’ chosen for ideas to improve health care, cut costs,” Jan. 21; “Center for Medicare and Medicaid Innovation aims to cut health-care costs,” Jan. 26] let defenders make outlandish claims about government efficiency, but gave short shrift to critics.
Government is not more innovative than private health insurance. It was private health plans that developed important innovations like prepayment, bundled payments, pay-for-performance, and penalties for medical errors. Government adoption typically lags private insurers by decades. In the rare instance where Medicare successfully tests an innovation (read: bundled payments for heart bypass surgery), it goes nowhere. If Thomas Edison had to submit his innovations to Medicare, you would be reading this by candlelight.
We don’t need more pilot programs to tell us that Medicare blocks innovation. What we need is a little skepticism when presented with the latest Bureau of Government Efficiency.
When Bipartisanship Is A Dirty Word
In a blog post I wrote about two years ago, I said “Usually when I hear that a policy proposal has bipartisan support, I instinctively check for my wallet.” At that time I was lauding a bipartisan proposal to shut the USDA’s market access program (although it seems that idea didn’t get much traction) under the heading “When Bipartisanship Is Good News.”
I should have trusted my instincts; i.e., that “bipartisanship” is code for either:
(a) “we’ve just renamed a post office”;
(b) “cough up, because we’ve agreed to spend more of your money”;
(c) “brace yourself, because we’ve agreed to violate more of your liberties”; or
(d) both b and c (see, e.g., the Department of Homeland Security).
Last night we were treated to an example of (b), when the U.S. Senate in a 78 to 20 vote elected to follow the House’s lead (330 to 93, in that case) to re-authorize, with a bigger budget, the Export-Import Bank of the United States until 2014. (Please do click on the previous two links to the roll-calls so you can see how your friendly Representative or Senator voted on this taxpayer-funded slush fund for the biggest corporations in America, by the way). The bill will now go to the President for his signature.
Allow me a few comments. First, this is incredibly disappointing. One would think that this is an excellent time to shut down the Ex-Im Bank, what with bailout-fatigue, trillion dollar deficits and all. But this bill “had the backing of business and labor groups,” as this Washington Post article makes clear, and despite all of the rhetoric from both sides, it seems that Congress and the President loves them some special interest group pleadings.
Second, the fairly easily debunked talking points of Ex-Im supporters obviously resonated. Ex-Im Bank president Fred Hochburg (who one can hardly expect to do anything other than protect his job) showed an excellent ear for PR when he said “there are no Democratic or Republican exports. There are exports that create jobs. Good, middle-class jobs.” Exports! Jobs! Middle class! What’s not to love? And in the interest of non-partisanship, here’s a quote from Senator Lindsey Graham (R-SC) in response to the arguments made by what the WaPo article called ”tea party conservatives”:
“I live in the real world and the real world is that these financing mechanisms have to be available to American manufacturers to have a share of the overseas market”
Actually, Senator, I’m glad you raised “the real world”. Because in “the real world” stuff costs money, money that isn’t manna from heaven but taken from other people. And in the real world, regulations or other market interventions distort the economy, reallocating resources from their most productive uses as identified by volunteers putting their own money at risk and towards uses directed by political entities, responding to lobbying and other features of public choice. In the real world, there is nothing special about manufacturing per se, with lots of middle class (or “upper class” jobs, if the class system is something that matters to you) created in the service sector. Also in the real world? Private finance. Lots of it, as you would know if you spoke with any of the folks producing the 98 percent of U.S. exports that don’t rely on Ex-Im.
Third, and this is somewhat parenthetical, not one — NOT ONE — Democrat in either chamber voted against corporate welfare. Interestingly, according to the roll call for the 2002 re-authorization of the Ex-Im Bank, 26 democrats voted against re-authorization 10 years ago. So there was some opposition back when President Bush was in charge, but now that President Obama (as opposed to Candidate ”The Ex-Im Bank is little more than corporate Welfare” Obama) is supportive, apparently taxpayer guarantees for big business are ok. The following Democratic members switched their vote from “Nay” in 2002 to “Yea” (or should that be “Yay!”?) in 2012: Andrews, Baldwin, Conyers, deFazio, Jackson (IL), Kaptur, Matheson, Nadler, Owens, Pallone, Peterson (MN), Stark, and Waters (with Kucinich not voting in 2012, but voted “Nay” in 2002). I’d be curious to hear about what caused the change of heart.
Another Fairly Insane Cross-National Health Care Comparison
Yesterday, countless newspapers published a really disappointing story by Noam Levey that the Los Angeles Times ran under this title:
The article is little more than a puff piece for the hotly contested idea of universal coverage. It gives zero space to the competing strain of thought that the less the government does for the poor, the sick, and the vulnerable, the better off they will be.
It quotes “Dr. Julio Frenk, a former health minister in Mexico and dean of the Harvard School of Public Health” as saying, “As countries advance, they are realizing that creating universal healthcare systems is a necessity for long-term economic development.” A necessity? Gosh. It’s a wonder the United States ever became the world’s largest economy.
It speaks of such government guarantees as being popular, when what it really means to say is that people are dependent on the government for their health care and frightened to death that someone might take it away.
It laments the fact that the United States is an “outlier” because it fails to guarantee access to health care for all citizens, which “stands in stark contrast to America’s historic leadership in education…Long before most European countries, the United States ensured access to public schooling.” Yet it makes no mention of how U.S. students fare poorly in comparison to those in other advanced countries.
It devotes no time to the costs of such guarantees, other than to say that they are sometimes “more than twice what was expected.” But don’t worry, those costs are borne by the government. It does not say where governments get all that money. I guess we’ll never know.
Speaking of taxes, it makes no mention of how taxes suppress economic development. Evidently, unlike other taxes, those that support government-run health care systems do not incur the deadweight loss of taxation.
But the article was at its most ridiculous when it suggested that the health care sectors in poor countries like Rwanda and Ghana might possibly be ahead of the United States in any way whatsoever. As I have written about Rwanda:
The United States generates many of the HIV treatments currently fighting Rwanda’s AIDS epidemic, as well as other medical innovations saving lives there and around the world. More than any other nation, we create the wealth that purchases those and other treatments for Rwandans and other impoverished peoples. The United States is probably closer to providing universal access to medical care for its citizens — and, indeed, the whole world — than Rwanda. Rwanda’s “universal” system leaves 8 percent of its population uninsured. Though official estimates put the U.S. uninsured rate at 15.4 percent, the actual percentage is lower; and again, uninsured Americans typically have better access to care than insured Rwandans. The real paradox is here that Rwandan elites think the United States is doing something wrong.
Unfortunately, it’s not just the Rwandan elites. For my thoughts on how sensible people can make such insensible comparisons between the United States and other nations, read the rest of my post on Rwanda.
Stop Using Slippery-Slope Arguments? Where Would that End?
Richard Thaler writes in the New York Times:
Justice Scalia is arguing that if the court lets Congress create a mandate to buy health insurance, nothing could stop Congress from passing laws requiring everyone to buy broccoli and to join a gym…Can anyone imagine Congress passing a broccoli mandate law, much less the court allowing it to take effect?
Yes annnnd…yes. Next question.
Surely, the justices have the conceptual resources to draw a distinction between the health care market and the market for broccoli. And even if they don’t, then all the briefs, the zillions of blog posts and a generation’s worth of economic literature can help them.
If drawing a constitutionally meaningful distinction between the markets for health insurance and broccoli is child’s play for Thaler, he should school all the brief- and blog-post-writers who so far have failed. That would have been a more productive use of his thousand words than his build-up to this thesis:
If you are opposed to a policy, state your case based on the merits — not on the imagined risk of what else might happen down the road. The path of that road is so unpredictable that it may even produce a U-turn.
Good grief. Slippery-slope arguments are about principles. As in, “If you concede this principle because you don’t mind the result here, you will no longer have it to protect you against that bad result there.” Thaler’s thesis would lead, for example, to all manner of civil-liberties violations by the state because there simply isn’t enough political support to protect all the civil liberties of various minorities. But Thaler doesn’t want us to think about things like consequences or the future.
The potential for U-turns makes no more sense as an argument against invoking slippery slopes principles, because principled arguments can help generate the U-turn that opponents of, say, ObamaCare want to see.
I take silly arguments like this to be evidence that ObamaCare supporters are in complete panic mode.
Too Big to Manage
Yesterday I asked: If JPMorgan Chase’s loss of $2 billion shows the need for more bank regulation, what should the federal government’s $1.3 trillion deficit tell us? And Michael Cannon pointed out that in the private sector, people who make big mistakes tend to lose their jobs, unlike the public sector.
Today another theme is being heard, at the Wall Street Journal, on NPR, and many more places including even here at Cato@Liberty: banks like JPMorgan, which has annual revenue of $100 billion, are just “too big to manage.”
And again I have to wonder: if large banks are too big to manage, what should we think about the federal government? The federal government is the largest landowner, the largest insurer, the largest employer, the largest banker in the country. It operates everything from a judiciary to the most complex armed force in history to numerous health insurance programs to a retirement system to a highway system to a peanut subsidy program.
If JPMorgan is too big to manage, can we possibly expect competent management of such a massive operation that doesn’t even face the feedback of profit and loss?
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