On Election Eve…
With Tuesday’s election widely predicted to bring a near-historic shake-up of the political establishment, here are some things we can say for certain even before the first results are tallied:
- This election will be a win for economic conservatives, not social conservatives. Not surprisingly given the economic climate, economic issues dominated the campaign, with social issues barely registering. This was particularly helpful for Republicans, since economically conservative, socially moderate suburban voters, who backed Democrats in 2006 and 2008, switched to Republicans this year. There is a lesson here for Republicans in the future.
- In the months leading up to the election, we have heard a great deal about the so-called “civil war” in the Republican Party. As it turns out, there wasn’t one. Despite some spirited, even bitter, primary fights, Republicans of all stripes were able to unify around a common opposition to the Obama agenda. But having achieved electoral success, Republicans will now be forced to confront the serious divisions in their party: tea partiers vs. the GOP establishment; economic conservatives vs. social conservatives; budget hawks vs. neoconservatives. The “civil war” will be back with a vengeance.
- Voters will choose Republicans in this election because they aren’t Democrats. It doesn’t mean that voters have fallen in love with the Republican party. In fact, polls show that Republicans remain only slightly more popular than used car salesmen—or Democrats. At best, voters are willing to give Republicans one last chance. If they don’t deliver, it will be a long, long time before they get another one.
- No issue hurt Democrats as much as the health care bill. It wasn’t just that voters hate the bill—they do—but that it crystallized the average American’s antipathy to a government that was too big, too costly and too out of touch. Voters will declare that they don’t want government running health care…and come to think of it, they don’t want government running much else either.
Missourians Don’t Like Mandate
As Roger Pilon mentioned, yesterday’s Politico question was “Is Health Care Repeal Gaining Steam?” A timely question in light of Monday’s court decision allowing a lawsuit against the health care mandate to proceed.
And perhaps an even more timely question today, now that 71 percent of Missouri voters have voted for a proposition to exempt the state from the mandate.
Polls show continuing opposition to the Obama-Reid-Pelosi health care overhaul. It’s constitutionally dubious. And now, in the only popular vote on the bill, it received a full 29 percent of the vote. Just maybe this wasn’t a good idea.
Bad Medicine: A Guide to the Real Costs and Consequences of the New Health Care Law
At more than 2,500 pages and 500,000 words long, the new health care bill — the Patient Protection and Affordable Care Act — is the most significant transformation of the American health care system since Medicare and Medicaid.
The bill’s complexity has created confusion, frustration, false expectations, and conflicts about its coverage and impact. An incisive new report by Cato scholar Michael D. Tanner provides an authoritative and deeply revealing explanation of its provisions.
The diagnosis: the bill is bad medicine. It is likely to make Americans less healthy, less prosperous, less able to direct their own health care decisions, and places huge burdens on our economy and already massive national debt. It is now certain that the debate over health care reform will be with us for much longer.
Update: Printed copies are now available for purchase for $10.
Support for Repealing ObamaCare Hits 63 Percent
The polling firm Rasmussen Reports reports:
Support for repeal of the new national health care plan has jumped to its highest level ever. A new Rasmussen Reports national telephone survey finds that 63% of U.S. voters now favor repeal of the plan passed by congressional Democrats and signed into law by President Obama in March.
Prior to today, weekly polling had shown support for repeal ranging from 54% to 58%.
Currently, just 32% oppose repeal.
The new findings include 46% who Strongly Favor repeal of the health care bill and 25% who Strongly Oppose it.
Repeal the bill.
Columbus Dispatch: ObamaCare = Malpractice
Popular discontent with ObamaCare extends even so far as the traditionally left-of-center Columbus Dispatch editorial page:
Almost daily, the ill effects of the health-care overhaul passed by Congress last month are becoming apparent. As employers and government bureaucrats analyze the law’s effect on bottom lines for the private sector and for government, the alarm bells are ringing.
The tragedy is that these ill effects could have been and should have been calculated before the law was passed, not after.
In fact, many of them were prophesied before passage of the bill, but the prophets were ignored by President Barack Obama and the Democratic majority in Congress. That’s because their uppermost goal was not to pass the best health-care bill possible but merely to pass anything that could be called “health-care reform” and could be claimed as a political victory by a president desperate for one.
The latest analysis of the bill’s likely effects comes from the Office of the Actuary in the federal Centers for Medicare and Medicaid Services. The report by Chief Actuary Richard S. Foster says that, far from reducing the cost of health care, the overhaul will add $311 billion to the nation’s health-care costs over the first decade the law is in effect…
As the weeks roll by, more and more unintended and should-have-been-anticipated consequences of this ill-conceived law will be revealed.
This should be no surprise, considering that the law was slapped together behind closed doors without proper testimony and vetting by health-care, financial and insurance experts, and is a patchwork of political and special-interest deals rammed through Congress using procedural gimmicks.
The nation deserved something much, much better than this.
Read the full editorial. Repeal the bill.
Costly IRS Mandate Slipped into Health Bill
Most people know about the individual mandate in the new health care bill, but the bill contained another mandate that could be far more costly.
A few wording changes to the tax code’s section 6041 regarding 1099 reporting were slipped into the 2000-page health legislation. The changes will force millions of businesses to issue hundreds of millions, perhaps billions, of additional IRS Form 1099s every year. It appears to be a costly, anti-business nightmare.
Under current law, businesses are required to issue 1099s in a limited set of situations, such as when paying outside consultants. The health care bill includes a vast expansion in this information reporting requirement in an attempt to raise revenue for an increasingly rapacious Congress.
In a recent summary, tax information firm RIA notes the types of transactions covered by the new 1099 rules:
The 2010 Health Care Act adds “amounts in consideration for property” (Code Sec. 6041(a) as amended by 2010 Health Care Act §9006(b)(1)) and “gross proceeds” (Code Sec. 6041(a) as amended by 2010 Health Care Act §9006(b)(2)) to the pre-2010 Health Care Act categories of payments for which an information return to IRS will be required if the $600 aggregate payment threshold is met in a tax year for any one payee. Thus, Congress says that for payments made after 2011, the term “payments” includes gross proceeds paid in consideration for property or services.
Basically, businesses will have to issue 1099s whenever they do more than $600 of business with another entity in a year. For the $14 trillion U.S. economy, that’s a hell of a lot of 1099s. When a business buys a $1,000 used car, it will have to gather information on the seller and mail 1099s to the seller and the IRS. When a small shop owner pays her rent, she will have to send a 1099 to the landlord and IRS. Recipients of the vast flood of these forms will have to match them with existing accounting records. There will be huge numbers of errors and mismatches, which will probably generate many costly battles with the IRS.
Tax CPA Chris Hesse of LeMaster Daniels tells me:
Under the health legislation, the IRS could be receiving billions of more documents. Under current law, businesses send Forms 1099 for payments of rent, interest, dividends, and non-employee services when such payments are to entities other than corporations. Under the new law, businesses will be required to send a 1099 to other businesses for virtually all purchases. And for the first time, 1099s are to be sent to corporations. This is a huge new imposition on American business, costing the private economy much more than any additional tax that the IRS might collect as a result.
There appears to have been little discussion before this damaging mandate was slipped into the health bill and rammed through Congress, but a few business groups did raise concerns. Here’s what the Air Conditioner Contractors of America said:
The House bill would extend the Form 1099 filing requirement to ALL vendors (including corporate) to which they pay more than $600 annually for services or property. Consider all the payments a small business makes in the course of business, paying for things such as computers, software, office supplies, and fuel to services, including janitorial services, coffee services, and package delivery services.
In order to file all these 1099s, you’ll need to collect the necessary information from all your service providers. In order to comply with the law, you would have to get a Taxpayer Information Number or TIN from the business. If the vendor does not supply you with a TIN, you are obligated to withhold on your payments.
Private transactions are the core of a market economy, and the source of America’s growth and prosperity. Now the federal government is imposing a vast new web of red tape on perhaps billions of these growth-generating private exchanges.
For what purpose? So the spendthrift Congress can shake a few extra bucks out of private industry? The business sector is the generator of America’s high living standards, but most federal legislators just see it as a kitty to be raided or a cow to be milked dry.
I’m stunned that there wasn’t a broader debate before such a costly mandate was enacted. If it goes into effect, it will waste vast quantities of human effort in filling out forms, reworking computer systems, collecting and organizing data, and fighting the IRS. The struggling American economy can’t afford anymore suffocating tax regulations. This mandate is a giant deadweight loss. It should be repealed.
Media Coverage of the Health Care Overhaul
Over the course of the health care debate, the media often reported and editorialized — and sometimes it was impossible to tell the difference — quite favorably on the Democratic proposals running through Congress. While some upheld their journalistic responsibility to scrutinize and offer objective analysis of the legislation, many did not.
It was not surprising to read stories almost daily about how Obamacare would lift millions of poor, elderly, sick, and generally down-trodden Americans out of financial and medical crisis, and even go so far as to singlehandedly save the lives of hundreds of thousands of Americans over the course of the next decade. (It would even provide one free turkey for Thanksgiving to every family living 400 percent below the poverty level.)
This morning, however, the headlines read something like this:
- “Rasmussen: Public Favors Repeal 58%-38%” (Rasmussen Polls)
- “Lawmakers, Staff May Lose Coverage” (New York Times): Adds the Times, “The confusion raises the inevitable question: If they did not know exactly what they were doing to themselves, did lawmakers who wrote and passed the bill fully grasp the details of how it would influence the lives of other Americans?”
- “Healthcare Law Could Boost Costs For Less Healthy Americans” (New York Times)
- “Healthcare Law Unlikely To Curb Premium Increases” (Los Angeles Times)
My question is this: where were these reporters before the passage of the health care bill?
Thursday Links
- Too bad no one saw this coming: Social Security is now in the red.
- Now that the health care bill is law, you should know exactly how it’s going to affect you, your premiums, and your coverage over the next few years. Here’s a helpful breakdown.
- As the health care overhaul crosses home plate, global warming legislation steps up to bat.
- Appreciate this: Chinese currency rise will have a negligible effect on the trade deficit. For more, read the whole paper.
- Podcast: “A Plea for Divided Government” featuring John Samples, author of the forthcoming book The Struggle to Limit Government.
Is Obama Losing David Brooks?
New York Times columnist David Brooks, President Obama’s biggest fan among self-proclaimed conservatives, has been plunged into the depths of despair by the latest machinations of Obama and his congressional allies:
Deem and pass? Are you kidding me? Is this what the Revolutionary War was fought for? Is this what the boys on Normandy beach were trying to defend? Is this where we thought we would end up when Obama was speaking so beautifully in Iowa or promising to put away childish things?
Yes, I know Republicans have used the deem and pass technique. It was terrible then. But those were smallish items. This is the largest piece of legislation in a generation and Pelosi wants to pass it without a vote. It’s unbelievable that people even talk about this with a straight face. Do they really think the American people are going to stand for this? Do they think it will really fool anybody if a Democratic House member goes back to his district and says, “I didn’t vote for the bill. I just voted for the amendments.” Do they think all of America is insane?
Wednesday Links
- Busy with an ambitious domestic agenda, the Obama administration has put trade issues on the back burner. Let’s hope it stays that way.
- A little lesson on how government works. (As opposed to how it’s supposed to work.)
- There has been talk that House Democrats are planning to “deem” the health care bill into law without calling for a vote. If you’re not sure how that process works, read this.
- Contrary to a growing belief in Washington, revaluing China’s currency will not cure the trade deficit.
- Podcast: “ObamaCare Threatens Innovation” featuring Michael F. Cannon.
The Bill Is Deemed Passed
Today’s question at Politico Arena is:
Should Democrats be worried that health care could be subject to a successful court challenge?
My response is:
I’m the first in my family not to be a lawyer. But Mike McConnell’s article seems compelling to me. As he notes, Article I, Section 7, of the Constitution requires that a bill must pass both houses of Congress to become a law. Duh. And for those who have trouble with that concept, he goes on: “As the Supreme Court wrote in Clinton v. City of New York (1998), a bill containing the ‘exact text’ must be approved by one house; the other house must approve ‘precisely the same text.’”
So the “deemed passed” rule doesn’t seem to be constitutional. Then the interesting question is, Will the Supreme Court strike down a major piece of welfare-state legislation just because Congress didn’t dot all the i’s and cross all the t’s. After all, some of us think the Supreme Court has failed to strike down legislation whose substance violates the Constitution. Would it be more forthright on a procedural issue? Would it dare to tell the political branches that they can’t have the health-care program they worked on for 14 months, negotiating careful and complicated compromises in both houses?
But then, the reason that Democrats are contemplating such an audacious scheme is precisely that they can’t find a bill that a majority of the House will vote for. So this wouldn’t be like the Supreme Court striking down Franklin Roosevelt’s Agricultural Adjustment Act, which passed Congress quickly and overwhelmingly in May 1933. It would not involve the Supreme Court standing up to the unified political branches. Rather, it would only require the Court to tell Congress that they have to actually pass bills before they become law, which apparently a majority of the House is not prepared to do.
More on the Last-Shot Strategy
Related to my post below on whether last-second shots with time expiring, while good for basketball, might be bad for governance, Steven Horwitz offers a compelling hypothetical in academic governance at Coordination Problem:
…Nonetheless, the leadership insists this curriculum change is crucially important to the future of the institution and if only the Faculty Senate would pass it and put it in place, the faculty and students would then realize just how good it is. In fact, the faculty leadership, working with the clear approval of the president and VPAA, are now scouring Roberts Rules of Order to find a series of sure-to-be controversial parliamentary maneuvers to get the Faculty Senate to approve the new curriculum without it ever going to the full faculty, and possibly without the Faculty Senate ever actually taking a clean vote on it. The president, meanwhile, is going around to students and alumni telling them how important this new curriculum is and, in the process, criticizing the faculty opponents by charging they have self-interested reasons for defending the status quo, even as the new curriculum proposal contains the aforementioned special deals for some of the faculty supporters.
The faculty as a whole and the student body continue to oppose the new curriculum by a consistent majority.
Having considered this hypothetical scenario, here are my questions for you my friends:
Would you consider this a legitimate way to pass a new curriculum? If the faculty leadership in conjunction with the administration were to ram this through by questionable parliamentary procedure and over the objections of a clear majority, do you think this new curriculum would have any legitimacy? …
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