Cochrane on ObamaCare’s Contraceptive-Coverage Mandate
My Cato colleague John Cochrane – who is way smarter than I am — has a generally excellent op-ed in today’s Wall Street Journal on ObamaCare’s contraception mandate:
Salting mandated health insurance with birth control is exactly the same as a tax—on employers, on Catholics, on gay men and women, on couples trying to have children and on the elderly—to subsidize one form of birth control…
The tax rate and spending debates that occupy the media are a small part of the effective taxes and spending that the government achieves by these regulatory mandates…
The natural compromise is simple: Birth control, abortion and other contentious practices are permitted. But those who object don’t have to pay for them. The federal takeover of medicine prevents us from reaching these natural compromises and needlessly divides our society…
Sure, churches should be exempt. We should all be exempt.
My only quibble is with his claim, “Insurance is a bad idea for small, regular and predictable expenses.”
That’s generally true. But medicine is an area where, potentially at least, small up-front expenditures (e.g., on hypertension control) could prevent large losses down the road. So it may be economically efficient for health plans to cover some small, regular, and predictable expenses. Both the carrier and the consumer would benefit. In fact, that would be the market’s way of telling otherwise uninformed consumers, “Hey! Controlling your hypertension is a really good for you!” And really, if someone is so risk-averse that they want health insurance with first-dollar coverage of everything – and they’re willing to pay the outrageous premiums that would accompany such coverage — why should we take issue with that?
ObamaCare’s contraceptive-coverage mandate demonstrates that government does a horrible job of picking only those types of “preventive” services for which first-dollar coverage will leave consumers better off. But I also think advocates of free-market health care generally need to let go of the idea that health insurance exists only for catastrophic expenses.
RTD: ‘Insurance Exchange: Just Say No’
Regarding legislation to create an ObamaCare “Exchange” in Virginia, the Richmond Times-Dispatch explains:
Republicans at the General Assembly are falling prey to the fallacy of the false alternative…
[H]ere are the real options facing Virginia: (a) federal bureaucrats determine the form of our exchange, or (b) federal bureaucrats determine the form of our exchange. There is no (c)…
Running a health-insurance exchange would cost a lot of money — money Virginia does not have. Since Washington will dictate how it will be run, Washington should pick up the tab.
The Ethos of Universal Coverage
Associated Press photojournalist Noah Berger captured this thousand-word image near the Occupy Oakland demonstrations last month.
(AP Photo/Noah Berger)
Many Cato@Liberty readers will get it immediately. They can stop reading now.
For everyone else, this image perfectly illustrates the ethos of what I call the Church of Universal Coverage.
Like everyone who supports a government guarantee of access to medical care, the genius who left this graffiti on Kaiser Permanente’s offices probably thought he was signaling how important other human beings are to him. He wants them to get health care after all. He was willing to expend resources to transmit that signal: a few dollars for a can of spray paint (assuming he didn’t steal it) plus his time. He probably even felt good about himself afterward.
Unfortunately, the money and time this genius spent vandalizing other people’s property are resources that could have gone toward, say, buying him health insurance. Or providing a flu shot to a senior citizen. This genius has also forced Kaiser Permanente to divert resources away from healing the sick. Kaiser now has to spend money on a pressure washer and whatever else one uses to remove graffiti from those surfaces (e.g., water, labor).
The broader Church of Universal Coverage spends resources campaigning for a government guarantee of access to medical care. Those resources likewise could have been used to purchase medical care for, say, the poor. The Church’s efforts impel opponents of such a guarantee to spend resources fighting it. For the most part, though, they encourage interest groups to expend resources to bend that guarantee toward their own selfish ends. The taxes required to effectuate that (warped) guarantee reduce economic productivity both among those whose taxes enable, and those who receive, the resulting government transfers.
In the end, that very government guarantee ends up leaving people with less purchasing power and undermining the market’s ability to discover cost-saving innovations that bring better health care within the reach of the needy. That’s to say nothing of the rights that the Church of Universal Coverage tramples along the way: yours, mine, Kaiser Permanente’s, the Catholic Church’s…
I see no moral distinction between the Church of Universal Coverage and this genius. Both spend time and money to undermine other people’s rights as well as their own stated goal of “health care for everybody.”
Of course, it is always possible that, as with their foot soldier in Oakland, the Church’s efforts are as much about making a statement and feeling better about themselves as anything else.
The Real Tragedy of the Komen/Planned Parenthood Flapdoodle
…is that it overshadowed news that the U.S. House of Representatives overwhelmingly voted to repeal one of two new entitlement programs created by Obamacare—the ironically named CLASS Act—with a bipartisan three-fifths majority. (With numbers like that, Congress could even repeal Obamacare’s death panel!)
But really, one private organization pulling funding for another private organization is way more important than Congress voting to repeal an entitlement program … isn’t it?
Two Thoughts on Susan G. Komen & Planned Parenthood
I’m sure that many of you are following the controversy over the Susan G. Komen for the Cure Foundation’s decision to suspend its partnership with and funding of Planned Parenthood. Two thoughts on this:
First, this controversy provides a delightful contrast to the Obama administration’s decision to force all Americans to purchase contraceptives and subsidize abortions.
The Susan G. Komen Foundation chose to stop providing grants to Planned Parenthood. Lots of people didn’t like (and/or don’t believe) Komen’s reasons. Some declared they would stop giving to Komen. Others approved of Komen’s decision and started giving to Komen. Many declared they would start donating to Planned Parenthood to show their disapproval of Komen’s decision.
Notice what didn’t happen. Nobody forced anybody to do anything that violated their conscience. People who don’t like Planned Parenthood’s mission can now support Komen without any misgivings. People who like Planned Parenthood’s mission can still support it, and can support other organizations that fight breast cancer. The whole episode may end up being a boon for both sides, if total contributions to the two organizations are any measure. Such are the blessings of liberty.
Contrast that to Obamacare, which forces people who don’t like Planned Parenthood’s mission to support it.
Contraceptives Mandate Brings ObamaCare’s Coercive Power into Sharper Focus
President Obama is catching some well-earned blowback for his decision to force religious institutions “to pay for health insurance that covers sterilization, contraceptives and abortifacients.” You see, ObamaCare penalizes individuals (employers) who don’t purchase (offer) a certain minimum package of health insurance coverage. The Obama administration is demanding that coverage must include the aforementioned reproductive care services. The exception for religious institutions that object to such coverage is so narrow that, as one wag put it, not even Jesus would qualify. HHS Secretary Kathleen Sebelius reassures us, “I believe this proposal strikes the appropriate balance between respecting religious freedom and increasing access to important preventive services.” Ummm, Madam Secretary…the Constitution only mentions one of those things. The Catholic church is hopping mad. Even the reliably left-wing E.J. Dionne is angry, writing that the President “utterly botched” the issue “not once but twice” and “threw his progressive Catholic allies under the bus.”
As I wrote over and over as Congress debated ObamaCare, anger and division are inevitable consequences of this law. I recently debated the merits of ObamaCare’s individual mandate on the pages of the Wall Street Journal. Here’s a paragraph that got cut from my essay:
We can be certain…that the mandate will divide the nation. An individual mandate guarantees that the government—not you—will decide what medical services you will purchase, including contraceptives, fertility services that result in the destruction of human embryos, or elective abortions. The same apparatus that can force Americans to subsidize elective abortions can also be used to ban private abortion coverage once the other team wins. The rancor will only grow.
Or as I put it in 2009,
Either the government will force taxpayers to fund abortions, or the restrictions necessary to prevent taxpayer funding will reduce access to abortion coverage. There is no middle ground. Somebody has to lose. Welcome to government-run health care.
The same is true for contraception. The rancor will grow until we repeal this law.
ObamaCare highlights a choice that religious organizations — such as the United States Conference of Catholic Bishops, where my grandfather served as counsel — have to make. Either they stop casting their lots with Caesar and join the fight to repeal government health care mandates and subsidies, or they forfeit any right to complain when Caesar turns on them. Matthew 26:52.
New Video Has Important Message: Freedom and Prosperity vs. Big Government and Stagnation
The folks from the Koch Institute put together a great video a couple of months ago looking at why some nations are rich and others are poor.
That video looked at the relationship between economic freedom and various indices that measure quality of life. Not surprisingly, free markets and small government lead to better results.
Now they have a new video that looks at recent developments in the United States. Unfortunately, you will learn that the U.S. is slipping in the wrong direction.
The entire video is superb, but there are two things that merit special praise, one because of intellectual honesty and the other because of intellectual effectiveness.
1. The refreshingly honest aspect of the video is its non-partisan tone. It explains, in a neutral fashion, that Bush undermined prosperity by making government bigger and that Obama is undermining prosperity by increasing the burden of government.
2. The most important and effective argument in the video, at least from my perspective, is that it shows clearly that a larger government necessarily comes at the expense of the productive sector of the economy. Pay extra-close attention around the 2:00 mark.
It’s also worth pointing out that there are several policies that impact on economic performance. The Koch Institute video focuses primarily on the key issues of fiscal policy and regulation, but trade, monetary policy, property rights, and rule of law are examples of other policies that also are very important.
This video, narrated by yours truly, looks at economic growth from this more comprehensive perspective.
The moral of the story from both videos is very straightforward. If the answer is bigger government, you’ve asked a very strange question.
David H. Padden, R.I.P.
All of us at the Cato Institute are saddened to announce the passing of David H. Padden, one of our original Board members, at the age of 84. Dave took Emeritus Director status a couple of years ago, but for our entire 34 years he was closely involved in Cato’s activities, as director, contributor, and constant reminder of the principles on which we were founded. Ed Crane, Cato’s co-founder and president, often called him “the conscience of the Cato Institute.”
Dave was a Chicago businessman, the president and founder of Padden and Co. and Padco Lease Corp. A onetime conservative, he saw the light in the 1970s and became a radical and devoted libertarian. He created the Loop Libertarian League, a group that met monthly at the Union League Club in downtown Chicago to discuss politics and philosophy. At various times he was a director of Citizens for a Sound Economy, the Acton Institute, the Bionomics Institute, the Foundation for Economic Education, and the Center for Libertarian Studies. Besides his long service with Cato, he was best known as the founder of the Heartland Institute, where he served as chairman from 1984 to 1995.
Dave graduated from Loyola University in Chicago and received an MBA from Harvard. And while he devoted a great deal of time to studying liberty and helping build institutions to protect it, he knew that politics isn’t all of life. He was married to Joan for 61 years, a father of 7, a devoted grandfather and great-grandfather, a director of St. Xavier College and the Epilepsy Foundation, and a lifelong supporter of the Lyric Opera of Chicago. R.I.P.
Ayn Rand on the Front Page of Ecuador’s Major Newspaper
El Universo, the newspaper with the largest circulation and the paper that publishes my weekly column, ran a mostly blank front page today that features only this quote from Ayn Rand’s Atlas Shrugged:
When you see that trading is done, not by consent, but by compulsion–when you see that in order to produce, you need to obtain permission from men who produce nothing–when you see that money is flowing to those who deal, not in goods, but in favors–when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you–when you see corruption being rewarded and honesty becoming a self-sacrifice–you may know that your society is doomed.
This quote is from Francisco D’Anconia’s speech on “The Meaning of Money” which you can read here. (I used it in my column last month.) How did Rand’s quote get there? It’s a response to the latest and most prominent attack on freedom of the press in Ecuador and Latin America.
In less than four months the Ecuadorian courts, known for being slow, resolved the specious lawsuit President Rafael Correa filed against op-ed writer and editor Emilio Palacio, the directors of El Universo and the newspaper itself for libeling the country’s president. According to Correa, Palacio slandered him in this op-ed (in Spanish), and the newspaper and its directors “contributed” to committing the supposed crime. Incidentally, this court has had five different judges overseeing this case since February; the last one came in on Monday and issued his judgment yesterday, minutes before his authority expired.
The court’s decision sentences the directors of El Universo and Emilio Palacio to three years in jail and orders them to pay a total of $30 million to the President. The judge also ordered that the newspaper company pay an additional $10 million to President Correa.
This decision sets a dangerous precedent of making third parties responsible for what an individual says. It is a clear act of intimidation of all independent media outlets and of the citizens of Ecuador. Even though this is not the first blow to freedom of expression during this government, it certainly is the most radical given the context. On May 7th, a referendum gave the President unprecedented power to essentially pack the courts. Soon, the entire judiciary will be on the long list of state institutions captured or co-opted by the executive (including the constitutional court, the electoral authority, and the national assembly, among others).
Once the judiciary is completely captured and after this historic decision, we can expect more self-censorship or more people sued/jailed for expressing their opinions, or a combination of both. It is a harsh blow against liberty in our country, but a logical outcome of Correa’s populist push to centralize ever more economic and other power in his own hands.
Female Force: Ayn Rand
John Blundell, former director of the Institute of Economic Affairs in London, has written a new comic book biography of Ayn Rand. Find it in comic book stores, at Barnes and Noble, or on Amazon. Publisher Bluewater says:
“Female Force: Ayn Rand” will hit comic shops and online retailers on June 22nd. The 32-page comic retails for $3.99….
The comic book provides an entertaining yet scholarly look at the author of such seminal works as The Fountainhead and Atlas Shrugged. Even 30 years after her death, her sales of her books continue to sell in the hundreds of thousands each year. Bluewater also worked with the Ayn Rand Institute on the comic book.
“When the American economy went into a nose dive recently what did we all turn to? Did we dig out battered old Econ 101 textbooks? Did we turn to the writings of some aged Ivy League professor? NO! Instead we dusted off or repurchased The Fountainhead and Atlas Shrugged those great classic American novels by Russian immigrant Ayn Rand which deal so brilliantly with the fundamentals of a free and prosperous society of responsible individuals,” said author John Blundell.
Blundell, author of Margaret Thatcher: A Portrait of the Iron Lady as well
as Bluewater’s Thatcher bio comic, and formerly the Director General of the
Institute of Economic Affairs in London, emphasizes the relevancy and
potency of Rand’s Objectivism ideas in 21st century America.
Blundell also has a book coming in September, Ladies for Liberty: Women Who Made a Difference in American History. That one, I think, will have words but no pictures.
Presidents Should Obey the Law
In Star Wars III: Revenge of the Sith, when Chancellor Palpatine transforms the republic into an empire, Senator Amidala remarks:
So this is how liberty dies . . . with thunderous applause.
But it can also happen in silent acquiescence. For decades now, successive Congresses have evaded their responsibility to make decisions about the deployment of U.S. armed forces abroad. I write about the latest instance of this, in Libya, in today’s Britannica column:
Presidents have an obligation to obey the Constitution and the law. But one of the ways that separation of powers works is that each branch of government is supposed to jealously guard its prerogatives from usurpation by the other branches. Too often Congress ducks that responsibility, preferring to let presidents make decisions, make law, and make war without the involvement of Congress. As Arthur M. Schlesinger, Jr., explained in his book The Imperial Presidency, the expansion of presidential war-making power has been “as much a matter of congressional abdication as of presidential usurpation.”
The president is derelict in his duty to obey the Constitution and the War Powers Resolution. And Congress is derelict in its duty to assert its constitutional authority. And I’m still wondering what’s happened to the antiwar movement, which ought to be loudly protesting not just the continuing wars in Iraq and Afghanistan but the newborn war in Libya.
As George Will said last week, “even if you think the War Powers Resolution is an unwise law—it is a law.” And a former law professor who is now the president of the United States should obey the law. Will expanded on that point in his Sunday column, titled “Obama’s Illegal War,” in the old-fashioned print edition of the Washington Post.
Full Britannica column here.
Wisconsin: Post-Mortem & Predictions
Last night’s vote by the Wisconsin-based portion of the Wisconsin Senate has received enormous attention. The scope of collective bargaining by school district and other government employees has been narrowed, and the state will no longer automatically garnish workers’ wages to pay union dues.
This was the right thing to do. But how much of a difference will these changes actually make to the state’s bottom line? As I’ve noted, the presence or absence of collective bargaining is not strongly correlated with school district spending. Instead, unions have won their massively (42%) above- market compensation through well-funded political action; which brings us to the question of automatic paycheck deduction of union dues.
Without automatic dues withdrawals, will public school unions still be able to afford their fantastically successful political activities? There’s no reason to doubt it. Given the huge compensation premium public school employees enjoy over their private sector counterparts, they have a powerful incentive to voluntarily keep funding the political action that helped win it.
Indeed, we can see this already in right-to-work states like South Carolina. Public school employees there have no collective bargaining rights and there is no automatic union dues withdrawal, but the Palmetto State nevertheless has a teachers’ union and an administrators’ association that have spent large sums of money on political action. It’s worked. Despite not being the wealthiest of states, South Carolina still spends roughly $12,000 per pupil on its public schools, and its public school teachers earn more than the state’s median household income. The teacher and administrator groups have also successfully defeated every legislative effort thus far to open up the state’s education system to private sector competition and parental choice.
The only way to rein-in out-of-control public school spending is thus to give both families and taxpayers an alternative to the government monopoly status quo. Cut taxes on folks who pay for their own children’s education, or who donate to non-profit scholarship organizations that subsidize private school tuition for the poor. Many states are doing this already on a small scale. By so doing so on a larger scale, families will have much greater choices and taxpayers will reap enormous savings.
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