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InsiderOnline Blog: November 2013

To Do: Discover Why We’ve Got Things as Good as We Do

Learn how most of humanity has escaped grinding poverty and early death. Angus Deaton will talk about his new book The Great Escape: Health, Wealth, and the Origins of Inequality at the Cato Institute at noon on December 3.

Take in a “gripping, heart-wrenching look at the risks North Koreans are willing to endure to escape a despotic regime to reach freedom.” The Heritage Foundation will screen The Defector: Escape from North Korea, at 5:30 p.m. on December 5. 

Get the latest ideas on reforms in the states. The American Legislative Exchange Council’s 2013 States & Nation Policy Summit begins December 4 at the Grand Hyatt in Washington, D.C.

Find out how economists are integrating cultural data into their analyses. Jonah Goldberg will moderate a panel discussion on the intersection of economics and culture. The discussion will begin at noon on December 6 at the American Enterprise Institute.

Nominate a freedom champion for a Milton Friedman Prize. The Cato Institute gives the award every other year to “an individual who has made a significant contribution to advance human freedom.” The winner not only gets a $250,000 cash prize, but also feted at a dinner at the Waldorf-Astoria Hotel, to be held in May 2014. Nominations are due by December 31, 2013.

• Save the date for Resource Bank 2014: March 26 – 28 at the Sheraton New Orleans.

Posted on 11/27/13 05:49 PM by Alex Adrianson

ObamaCare Will Kill Jobs

President Obama and some Members of Congress want to raise the federal hourly minimum wage to $10.10 per worker. But as James Sherk and Patrick Tyrrell note, ObamaCare has already raised the effective minimum wage:

Obamacare requires many employers with 50 or more employees to offer qualifying health coverage to their full-time workers. This health coverage is expensive. In 2015, it will add $2.24 per hour to the cost of employing a worker with single coverage. Those that do not provide coverage face a fine of $2,000 per employee per year (after the first 30 workers) that comes out of after-tax dollars. This equates to a $3,279 increase in pre-tax payroll costs—$1.64 per hour. The Administration has delayed the mandate’s implementation until 2015. When it takes effect, it will increase the cost of hiring unskilled workers.

These costs are on top of other government mandates. Businesses must also pay the minimum wage, the employer share of payroll taxes, and unemployment insurance (UI) taxes. Normally, businesses defray these costs by reducing workers’ wages by an offsetting amount. However, employers cannot reduce the pay of minimum-wage employees, so they must pay these payroll costs themselves or forgo hiring. […]

Full-time employees with qualifying health benefits will cost their employers at least $10.92 per hour (with single coverage). Employers who opt to pay the penalty instead will nonetheless pay at least $10.30 per hour for labor. [Internal citations omitted.]

Sherk and Tyrell calculate that if the hourly minimum wage were raised to $10.10, employers would actually face costs of $13.27 per hour per full-time employee if they provide health insurance coverage. Those that choose to pay the penalty would still face hourly per-employee costs of $12.71.

One way for businesses to respond to those higher costs would be to raise prices and cut production, which means fewer jobs. Or businesses could substitute capital for labor—e.g., put robot hamburger makers to work. Another problem:

Employers can further avoid the penalty for [not providing health insurance] by cutting employees’ hours below 30 per week. Under Obamacare, that qualifies employees as part-time workers and exempts their employers from the penalty. Many firms have already announced plans to cut hours below the Obamacare threshold. [The Heritage Foundation, November 22]

Posted on 11/27/13 05:29 PM by Alex Adrianson

Just in Case Your Thanksgiving Doesn’t Usually Include Discussion of Annoying Subjects

ObamaCare is not only taking over much of health care, it’s taking over Thanksgiving dinner, too. The group Organizing for America has launched a campaign, complete with creepy video, to get Americans to needle their family members over the holidays about signing up for insurance. In the video, a young adult experiences that needling at the hands of his parents.

Young adults are the target for the message that getting insurance is a good idea. That’s probably because it is in fact not such a good idea for them. ObamaCare is less a way of providing insurance than a way of cross-subsidizing health care for older Americans at the expense of younger Americans. Insurers cannot charge different rates based on health condition. Many services have to be covered, regardless of whether the insured wants them or is likely to need them. That means premiums are going up for everybody, but especially younger Americans.

According to calculations by Drew Gonshorowski, in all but five states Americans will pay more for health insurance premiums in the ObamaCare exchanges than they had paid in the individual health insurance market. And in 34 states, the increases experienced by those who are age 27 are greater than the increases experienced by those who are age 50. [“How Will You Fare in the Obamacare Exchanges,” by Drew Gonshorowski, The Heritage Foundation, October 16]

Of course, young Americans could be eligible for subsidies. At the same time, by not signing up, they theoretically face a tax penalty. Yet, many young American will still come out ahead by not signing up. David Hogberg calculates that over 3 million young people would save $1,000 per year by paying the fine instead of buying a bronze plan from the exchanges. [“Why the ‘Young Invincibles’ Won’t Participate in the Obamacare Exchanges and Why It Matters,” by David Hogberg, National Center for Public Policy Research, August 2013]

And don’t forget, thanks to ObamaCare’s insurance regulations, insurers can’t turn you down. So why wouldn’t young Americans just wait till they get sick and then sign up? Maybe OFA wants to make them sick of their parents bugging them.

Posted on 11/27/13 05:03 PM by Alex Adrianson

The Ways of Power

Reflecting on the recent death of Jennifer Lynch, the Chief Commissioner of the Canadian Human Rights Commission and the chief antagonist against his free speech rights, Mark Steyn points to a fundamental lesson about government power:

Ms. Lynch lamented the “completely unbalanced” discussion in which she was cast as the Queen Censor, or even the Chief Commissar.

How odd to hear the head of a state agency whose principal purpose is to label citizens – Racist! Sexist! Homophobe! Islamophobe! – object to being labeled herself. I’m proud to say I gave her both names, and made a point of referring to her as “Commissar Lynch” in Canadian media appearances. We never met, mainly because she didn’t want to and went to great lengths to avoid my company. Nevertheless, we had several mutual friends, who told me that Jennifer was a decent, well-meaning sort who was simply in a mess not of her making. I don’t doubt it. When the Canadian thought police began their campaign against me and Ezra Levant, a number of outraged American readers wrote to me, saying, “You need to start kicking up a fuss about this, Steyn, and then maybe Canadians will get mad and elect a conservative government that will end this nonsense.” Made perfect sense. Except that Canada already had a Conservative government, under a Conservative Prime Minister, with a Conservative Justice Minister, who had appointed a Conservative to serve as the very head of the “human rights” commission investigating me: Jennifer Lynch. Ms Lynch had been Chief of Staff to Joe Clark, a former Conservative (after a fashion) Prime Minister. But, as a current cabinet minister once remarked to me, when an incoming Conservative ministry takes over the reins of Big Government, there are thousands and thousands of positions to fill in the bureaucracy, and nowhere near enough reliable Conservatives to fill them. So you find who you can, and the bureaucracy trundles on regardless. As I say somewhere in After America, you don’t need a president-for-life if you’ve got a bureaucracy-for-life. Jennifer Lynch, garlanded with every bauble the Canadian state could confer (the Queen’s Golden Jubilee Medal, etc), was the sort of person a government turns to fill all these posts. I’m sure she was decent and well-meaning and pleasant and likeable, but she put her fine qualities in the service of a squalid and corrupt regime whose practices could not survive the light Ezra and others shined on them. [SteynOnline, November 27]

Conservatives aren’t changing anything if they just win elections in order to put different people in control of the same levers of power. The bureaucracy will always tempt its appointees, even the conservative ones, to the dark side; and many appointees arrive there not even realizing they now work for evil ends.

Posted on 11/27/13 01:59 PM by Alex Adrianson

The World Needs More Free Market Competition, Not Less

Pope Francis is no fan of free markets, we learned this week from his Evangelii Gaudium. In particular he writes:

Today everything comes under the laws of competition and the survival of the fittest, where the powerful feed upon the powerless. As a consequence, masses of people find themselves excluded and marginalized: without work, without possibilities, without any means of escape.

What’s actually going on is pretty much the opposite of what the Pope thinks. Earlier this year, Economist reported:

In 1990, 43% of the population of developing countries lived in extreme poverty (then defined as subsisting on $1 a day); the absolute number was 1.9 billion people. By 2000 the proportion was down to a third. By 2010 it was 21% (or 1.2 billion; the poverty line was then $1.25, the average of the 15 poorest countries’ own poverty lines in 2005 prices, adjusted for differences in purchasing power). The global poverty rate had been cut in half in 20 years. [Economist, June 1; h/t: Matt Welch at Reason, November 26]

We don’t know any place on the planet where everything comes under the laws of competition and the survival of the fittest,” but nobody should doubt that freer markets do better job of lifting the people out of poverty than less free economic systems. Consider this graph from The Heritage Foundation/Wall Street Journal Index of Economic Freedom:


Posted on 11/27/13 11:36 AM by Alex Adrianson

The Iran Deal Will Make Future Bargaining Harder

On Sunday, the United States and Iran announced an agreement over Iran’s nuclear program. The Iranians are happy with the deal, but Israel and Saudi Arabia are not. James Phillips explains why that might be:

The agreement will marginally slow, but not halt, Iran’s nuclear efforts. It has been incorrectly described as a “freeze,” but many elements of Iran’s nuclear program will continue. Iran is allowed to enrich uranium, despite the fact that this explicitly violates U.N. Security Council resolutions. Tehran pledged to halt uranium enrichment above the 5 percent level appropriate for power reactors.

But the agreement does nothing to reduce Iran’s stockpile of low enriched uranium, ostensibly meant for its nuclear power reactor at Bushehr, despite the fact that reactor will be fueled by the Russians for at least 10 years anyway. […]

This is a flawed deal that risks reducing sanctions pressure on Iran over the next six months in return for easily reversible Iranian pledges, some of which Iran has given before but subsequently reneged on. The nuclear deal requires Iran to curb some, but not all, of its nuclear activities in return for about $7 billion in sanctions relief over six months. The problem is that easing sanctions will make the final step harder. To force Tehran to make the necessary deeper concessions in a final deal, more sanctions are required. But the deal commits the Administration to refrain from imposing more sanctions over the next six months. [The Foundry, November 26]

The agreement does send a message, says Victor Davis Hanson:

The president’s dismal polls are only a multiplier of that general perception abroad that foreign policy is an auxiliary to fundamental transformation at home, useful not so much to create international stability per se, as to enhance Obama influence in pursuing his domestic agenda. Collate reset, lead from behind, “redlines,” “game-changers,” ”deadlines,” the Arab Spring confusion, the skedaddle from Iraq, Benghazi, the Eastern European missile pullback, and the atmosphere is comparable to the 1979–80 Carter landscape, in which after three years of observation, the opportunists at last decided to act while the acting was good, from Afghanistan to Central America to Tehran.

There is not a good record, from Philip of Macedon to Hitler to Stalin in the 1940s to Carter and the Soviets in the 1970s to radical Islamists in the 1990s, of expecting authoritarians and thugs to listen to reason, cool their aggression, and appreciate democracies’ sober and judicious appeal to logic—once they sense in the West greater eagerness to announce new, rather than to enforce old, agreements. [National Review, November 24]

Posted on 11/26/13 05:54 PM by Alex Adrianson

The FDA Now Wants to Regulate the Sharing of Genetic Information—in Other Words, Free Speech

For several years up until this week, the company 23andMe had been selling kits that allow consumers to take their own DNA samples at home and then mail them in for testing that will identify genetic risks for certain diseases and conditions. This week, the Food and Drug Administration informed the company that it can no longer sell the kits because the agency considers them unapproved medical devices.

The FDA claims its wants to make sure consumers aren’t being given inaccurate information about their genetic risks. What it’s really doing, says Alex Tabarrok, is unconstitutionally preventing individuals from receiving information about their own bodies:

[T]he FDA wants to judge not the analytic validity of the tests, whether the tests accurately read the genetic code as the firms promise (already regulated under the CLIA [Clinical Laboratory Improvement Amendments]) but the clinical validity, whether particular identified alleles are causal for conditions or disease. The latter requirement is the death-knell for the products because of the expense and time it takes to prove specific genes are causal for diseases. Moreover, it means that firms like 23andMe will not be able to tell consumers about their own DNA but instead will only be allowed to offer a peek at the sections of code that the FDA has deemed it ok for consumers to see.

Alternatively, firms may be allowed to sequence a consumer’s genetic code and even report it to them but they will not be allowed to tell consumers what the letters mean. Here is why I think the FDA’s actions are unconstitutional. Reading an individual’s code is safe and effective. Interpreting the code and communicating opinions about it may or may not be safe—just like all communication—but it falls squarely under the First Amendment.

Tabarrok also notes that the only way of discovering and validating connections between genes and diseases is to collect genetic data from a very large number of people—precisely what the FDA is now telling 23andMe that it can’t do. “There are some 7,000 known diseases and only about 500 have a treatment. Individual and disease heterogeneity is so large that even the diseases that we can treat are often not treated well. New approaches are necessary for progress.” [Marginal Revolution, November 26]

Posted on 11/26/13 05:07 PM by Alex Adrianson

Here’s the ObamaCare Conversation Starter We Really Need

ObamaCare’s stumbles aren’t just a failure of government experts to design a program that makes sense and works. They are, as Peter Boetke points out, part of a pattern of government failure that arises whenever we rely on government experts to plan things that no set of government experts can plan because they cannot gather in one place all the knowledge they would need to improve on market (or in the case of health care, hybrid market-government) outcomes:

It is human arrogance and human opportunism with guile that gets us all the time in our efforts to pursue idealized plans for public management of economic and social affairs with the purpose of human betterment. And this isn’t just a matter of slouching toward a solution. Arrogance and opportunism have huge costs in terms of money and lives, and very few benefits in terms of devising better solutions.

Any governmental plan that exhibits the arrogance of the pretense of knowledge, and unleashes opportunities for the most opportunistic of us to benefit at the expense of others, must be resisted and ultimately rejected as an approach to public policy. We need a stronger filter on policies within the given structure of government – e.g., a generality norm – but more importantly we need to make sure the structure of governance is such that we do not ask the government and its officers to do things that they are incapable of doing. We need to address not only questions of the size of government, but more importantly the responsibilities of government.

What better time to start this conversation than now? [Coordination Problem, October 31]

If this theme of questioning the scope of responsibilities we give government sounds familiar to you, then perhaps you read Peter Boetke’s article in our Summer 2013 issue of The Insider: “Why Does Government Overspend? Because It Has Too Much Power.” If you haven’t read it yet, what better time than now?

Posted on 11/26/13 12:06 PM by Alex Adrianson

Another Rough Week for the ObamaCare Rollout

Here are some highlights:

• In a Rose Garden address last month, President Obama cited Jessica Sanford as an example of an ObamaCare success story. However, the state of Washington recently told her it had miscalculated her tax credit eligibility and that her monthly premiums would increase from $198 to $280. She has decided she cannot afford the coverage. “It was a huge disappointment, and especially since my story had been shared by the president,” said Sanford. [CNN, November 19]

• On Tuesday, Secretary of Health and Human Service Kathleen Sebelius visited some health care navigators in Miami, Fla. Local media were on hand to record the visit, and as Secretary Sebelius spoke with a couple in the middle of signing up, crashed. Someone said: “Uh oh.” How could she have not figured that might happen? [Washington Post, November 20]

• Oregon, a state that leans to the progressive side of the political spectrum, has so far enrolled nobody through its state exchange. That’s because its online portal isn’t ready at all. The state is now scrambling to process the 18,000 paper applications (19 pages each) it has received. [, November 20]

• Coloradan Shane Smith got a letter informing him that his dog Baxter had been enrolled in coverage through the state’s health insurance exchange. Smith says he has no idea how his dog got enrolled, though he did provide his dog’s name as the answer to a security question when he logged on to create his own account. [Fox News, November 21]

• On Friday, the Obama administration announced another ObamaCare delay. The open enrollment period has been pushed back—for 2015. The start of the period will now be November 15, 2014, instead of October 1, 2014. Curious timing, that—right after the 2014 elections. Could it be the administration is worried about something enrollees might discover were they to re-enroll on October 1? Laura Trueman points out that the cost of plans next year is likely to spike since “current enrollment in the exchanges is drawing older people, as young adults discover they can’t afford the Cadillac plans mandated by Obamacare. The 2015 plans will be priced based on the experiences of the older than expected population.” [The Foundry, November 22]

Posted on 11/22/13 10:32 PM by Alex Adrianson

It Pays to Be a Broker in Government Largess

At least one region of the country is doing rather well. A Washington Post special report from Greg Jaffe and Jim Tankersley finds that affluence has been on the rise in Washington, D.C.

During the past decade, the region added 21,000 households in the nation’s top 1 percent. No other metro area came close […] big companies realized that a few million spent shaping legislation could produce windfall profits. They nearly doubled the cash they poured into the capital.

The signs of the new Washington are everywhere — from the Tiffany store that Fairfax County (Va.) development officials boast is the most profitable in the country to the new Tesla dealership in Tysons Corner. Every morning on the Beltway, contractors, lobbyists and some of the country’s highest-paid lawyers sit in the nation’s worst traffic. […] Essentially, Washington has been the beneficiary of a decade-long, taxpayer-funded stimulus package. […] It’s hard to say exactly how many of Washington’s households in the top 1 percent draw their incomes from the broad business of serving, supplying or influencing the government. But an analysis of tax data by the Economic Policy Institute shows that the area’s 1-percenters are most likely to be lawyers and executives. […] Nearly 1 in 10 of those households is headed by a government worker. […]

Government relations has become so important to the bottom line of a modern company, Becker said, that it should be a required course at business school. The numbers suggest she’s right. Companies spent about $3.5 billion annually on lobbying at the end of the last decade, a nearly 90 percent increase from 1999 after adjusting for inflation, political scientist Lee Drutman notes in a forthcoming book, “The Business of America Is Lobbying.” […] The more companies spend on influence, the lower their effective tax rates and the higher their stock returns compared with competitors’, according to recent research. A company called Strategas has built an index to track the stock performance of the 50 companies that lobby the most; last year, that index outperformed the rest of the market by 30 percent. [“Capital gains: Spending on contracts and lobbying propels a wave of new wealth in D.C.” by Greg Jaffe and Jim Tankersley, Washington Post, November 17]

Posted on 11/22/13 09:38 PM by Alex Adrianson

Who Needs Kyoto?

China and India both signed the Kyoto protocol on greenhouse gas emissions in 1997. The United States did not. From James Taylor, here’s a snapshot on how that has worked out:

U.S. carbon dioxide emissions declined by 3.7 percent in 2013, the Tyndall Centre for Climate Change Research at the University of East Anglia (UK) reports. The decline in U.S. emissions continues a dramatic drop in U.S. emissions this century, even as global emissions rapidly rise. […]

Global emissions will rise by 2.1 percent during 2013, powered mainly by a 5.9 percent increase in China and a 7.7 percent increase in India.

U.S. emissions have declined 14 percent since the year 2000. The decline is even more dramatic since 2007, with U.S. emissions down 16 percent in that short time.

Global emissions continue to rise despite the ongoing decline in U.S. emissions. Global emissions are up 45 percent since 2000, and up 16 percent since 2007.

China now emits approximately double the emissions of the second largest emitter, with China accounting for 27 percent of global emissions and the United States accounting for 14 percent of global emissions. Since the year 2000, China alone is responsible for two-thirds of the global increase in carbon dioxide emissions. [Heartland Institute, November 19]

Posted on 11/22/13 07:26 PM by Alex Adrianson

Some First Amendment Plaintiffs the ACLU Likes; Some It Doesn’t

On November 8, Elaine Huguenin asked the U.S. Supreme Court to hear her appeal of the New Mexico Supreme Court’s ruling that her photography business cannot refuse on moral grounds to provide wedding photography services to same-sex couples.

The American Civil Liberties Union has filed a brief in this case. Can you guess which side the ACLU has taken? Here is the ACLU talking about one episode in its history:

One of the most noted moments in the ACLU’s history occurred in 1978 when the ACLU defended a Nazi group that wanted to march through the Chicago suburb of Skokie, Illinois where many Holocaust survivors lived. The ACLU persuaded a federal court to strike down three ordinances that placed significant restrictions on the Nazis’ First Amendment right to march and express their views. The decision to take the case was a demonstration of the ACLU’s commitment to the principle that constitutional rights must apply to even the most unpopular groups if they’re going to be preserved for everyone. Many now consider this one of the ACLU’s finest hours.

If Nazi’s can march through the neighborhoods of Holocaust survivors, shouldn’t photographers be able to walk away from a same-sex wedding? Aren’t they both engaged in forms of expression? Nope, that’s not what the ACLU thinks. Adam Liptak got an explanation of the ACLU’s position from one of its lawyers, Louise Melling:

Ms. Melling said the evaluation had required difficult choices. Photography is expression protected by the Constitution, she said, and Ms. Huguenin acted from “heartfelt convictions.”

But the equal treatment of gay couples is more important than the free speech rights of commercial photographers, she said, explaining why the A.C.L.U. filed a brief in the New Mexico Supreme Court supporting the couple.

“This is a business,” Ms. Melling said. “At the end of the day, it sells services for photographing weddings. This is like putting up a sign that says ‘Heterosexual Couples Only.’” [New York Times, November 18] [H/t: Jacob Sullum, Reason, November 19]

The folks who make a living producing not images but sentences and paragraphs still earn some sympathy from the ACLU. Mark Steyn reports that the ACLU has filed a brief supporting Steyn and National Review against defamation lawsuit filed by global warming proponent Michael Mann. Steyn writes:

And they’re very strong on a couple of key points — that what they call “the value protecting of free speech on issues of public interest” is paramount, and that in suits like these the litigant’s goal is not to win or lose but “to intimidate the advocate ‘into silence.’” [National Review, November 14]

If the ACLU wanted to be consistent, it would support the free expression rights of both Mark Steyn and Elaine Huguenin. We’re pretty sure that Steyn, like Huegenin, makes a living plying his trade.

Posted on 11/22/13 06:45 PM by Alex Adrianson

What to Remember About November 22

Sure, the assassination of John F. Kennedy 50 years ago Friday is a big deal historywise, but did you know that Aldous Huxley and C.S. Lewis also died on that same day in 1963? Dan Hannan remembered:

Both men wrote dystopian novels. Huxley’s Brave New World foresaw a time when reproduction would be industrialised and the population drugged. Lewis’s That Hideous Strength tells of Britain being taken over by an apparently benign, but in fact diabolical, bureaucracy. Art often anticipates life and, deliciously, the bureaucracy is known by the acronym NICE.

Lewis’s work now seems the more relevant. Regular readers will know that what I call the EU’s hideous strength its ability to make good people do bad things – has been one of the long-running themes of this blog for the past six years. What stays in my mind from Brave New World, by contrast, is not the science fiction, but the way the main character comes to see that, in a plastic society, reality is reached through Shakespeare, “that other world of truer-than-truth”. [The Telegraph, November 22]

Posted on 11/22/13 04:26 PM by Alex Adrianson

To Do: Be Thankful

• Celebrate Thanksgiving, and if you happen to be in the neighborhood of Plymouth, Mass., on November 23, you can celebrate a little early. Plymouth is the location of the colony formed by the Pilgrims after they disembarked from the Mayflower in 1620. The Pilgrims held the first Thanksgiving in 1621. Plymouth’s Thanksgiving parade this year will celebrate heroes from throughout America’s history, including Squanto, Abraham Lincoln, and the first responders to the Boston Marathon bombing. Attendees are encouraged to bring non-perishable food items for a local food bank.

• Discover how economic liberty can improve life in the Middle East. The Fraser Institute, the International Research Foundation, and the Friedrich Naumann Foundation will host the 8th Annual Economic Freedom of the Arab World Conference in Muscat, Oman, on November 25 and 26.

Learn about the problematic science and failed predictions of anthropogenic climate change. Professor Michael Beenstock will speak at the Institute of Economic Affairs in London. His lecture will begin at 6 p.m. on November 27.

• If you have a nonprofit in the Washington, D.C., area and it excels in the areas of fiscal management, communication, organizational and resource development, planning, human resources, risk management, or use of technology, then you should consider applying for the Washington Post Award for Excellence in Nonprofit Management. Your nonprofit might win $10,000. Applications are now open for the 2014 award; the application deadline is January 6, 2014.

Posted on 11/22/13 03:37 PM by Alex Adrianson

In Louisiana School Choices Lives—for Now

The Department of Justice has backed off of its efforts to keep kids in failing schools in order to preserve what it deems to be the right racial balance—at least temporarily. In a motion filed in August, the Department had claimed that Louisiana’s school voucher program would upset the racial balance in the 34 Louisiana school districts governed by court-supervised desegregation plans.

On Monday, a federal district judge issued a procedural ruling that describes the DOJ’s position as having shifted from seeking to require federal pre-approval for any voucher issued to a student in those school districts to seeking the creation of a notice procedure. The DOJ now wants Louisiana to give it information on the assignment of students to voucher schools 45 days before assignments are finalized and the parents notified.

A big problem for the DOJ’s initial motion seems to have been that there is no evidence that school choice makes segregation worse. A literature review conducted by Greg Forster earlier this year finds that many studies measuring segregation are flawed because they compare the racial composition of individual schools to the racial composition within the school district, a method that effectively masks any segregation caused by school district boundaries themselves. Among studies that do not have that flaw, Forster reports:

Seven of these studies find that school choice moves students into less racially segregated classrooms. The remaining study finds that school choice has no net impact on racial segregation. None find that choice increases racial segregation.

This result should not be surprising says Forster: “Public schools are intractably segregated by race because students are assigned to schools based on where they live, and school choice has the potential to break down these residential barriers.” [“A Win-Win Solution: The Empirical Evidence on School Choice,” by Greg Forster, Friedman Foundation for Educational Choice, April 2013]

Two recent studies have examined the Louisiana Scholarship Program specifically. Anna J. Egalite and Jonathan N. Mills, graduate students at the University of Arkansas, find:

In the school districts under federal desegregation orders, which are the focus of the Department of Justice litigation, LSP transfers improve integration in both the sending schools and the private schools that participating students attend (receiving schools). […] For sending schools, 74 percent of the moves improve integration, while just 26 percent have a negative impact. In receiving schools, 56 percent of total transfers improve integration. Again, when we break out our results by race, we find that nearly 90 percent of African American transfers improve desegregation in their sending schools. [Education Next, Winter 2014]

And Boston University political science professor Christine Rossell also finds that vouchers improve desegregation. As described by Politico’s Caitlin Emma, Rossell’s study finds:

[I]n all but four of the districts – some of which are majority white, some majority black and some more evenly split – vouchers improved or had no effect on racial imbalance. And in the districts where racial imbalance worsened, the effects were “miniscule.” [Politico, November 8] [H/t: Jason Bedrick at Cato at Liberty, November 12]

The court is scheduled to hear arguments on the Department of Justice’s new request on Friday, November 22.

Posted on 11/22/13 01:22 PM by Alex Adrianson

Forgoing Growth

Most of the fiscal “austerity” accomplished during 2013 was composed of tax increases not spending cuts, reports Salim Furth:

Several tax increases took effect in January 2013: new Obamacare taxes, the expiration of the payroll tax, and “fiscal cliff” tax increases. During the fiscal year (which ended on September 30), those together increased taxes by $188 billion.

The spending cuts (i.e., sequestration) took effect in March 2013. Sequestration reduced fiscal year (FY) 2013 budget authority by $85 billion, but only $42 billion of the cuts took effect during FY 2013.

But what would have happened if we had traded $188 billion of tax increases for the same amount of spending cuts? Here are the estimates produced by four different economic models:

[The Heritage Foundation, November 14]

Posted on 11/21/13 04:35 PM by Alex Adrianson

Taxpayers Are Paying for Pro Tax Advocacy

The Small Business Administration, a government agency established to support small businesses and entrepreneurs, has weighed in on the side of more taxes—and used taxpayer funds to do so, of course. The agency commissioned an $80,000 study on how an Internet sales tax would affect small businesses by longtime advocates of an Internet sales tax. Not surprisingly, as John Berlau reports, Donald Bruce and William F. Fox of the University of Tennessee’s Center for Business and Economic Research reached a conclusion favorable to an Internet sales tax—specifically that the so-called Marketplace Fairness Act would affect only 1,817 online retailers.

Berlau notes that the study is based on a survey of 1,000 companies by Internet Retailer magazine, which may not be representative of the many retailers who sell online. [, November 20]

Posted on 11/20/13 06:02 PM by Alex Adrianson’s New Metrics Won’t Tell Us Anything

The Obama administration says will be a success “if 80 percent of users can buy health-care plans online,” report Amy Goldstein and Juliet Eilperin:

According to a government official familiar with the new target, the 20 percent who are unlikely to be able to enroll online are expected to fall into three groups: people whose family circumstances are so complicated that the Web site cannot determine their eligibility for subsidies to help pay for health plans; people uncomfortable buying insurance on a computer; and people who encounter technical problems on the Web site. [Washington Post, November 16]

But what does “80 percent of users can buy health-care plans online” mean? The new metrics are as clear as mud, says Megan McArdle:

The [Post] article says that the administration has related metrics for things such as lag time and the error rates in delivering pages, which imply that the answer is “80 percent of attempts will succeed.”

But then why would you lump “people who are uncomfortable buying insurance on a computer” into the group of people who won’t succeed? Presumably, something close to none of the attempts to use the website to buy insurance will be made by people who are uncomfortable buying insurance on a website.

“Eighty percent of total enrollees having gone through the site” is a pretty useless metric; the administration could theoretically satisfy this metric by getting five people enrolled: four on the exchanges and one through a paper application. […]

[I]t’s unlikely that the administration is measuring this directly; rather, they’d be constructing a model based on lower-level metrics such as ... lag times and page-delivery errors. The nice thing about models is, of course, that they can be tweaked. All of which is to say that if the administration does not want to fail this metric, it won’t. [Bloomberg, November 18]

Posted on 11/19/13 05:45 PM by Alex Adrianson

This Month in Liberal Condescension

“It’s fascinating to me that some of the pushback is coming from, sort of, white suburban moms who—all of a sudden—their child isn’t as brilliant as they thought they were and their school isn’t quite as good as they thought they were […] . Do we want more for our kids, or do we want less? Do we want higher standards or not?
—Arne Duncan, trying to explain why some people oppose national Common Core education standards. [Politico, November 18]

“Well, it really wasn’t any fun. I did not enjoy having to answer to the voters. I didn’t like the idea that someone could stop you on the street and fill your ear full for 30 minutes just because they voted for you. I got to where I couldn’t stand the voters. And when you’re a politician, that’s a bad place to be.”
—John Grisham, remembering his short stint as a Mississippi state representative in the 1980s. [Los Angeles Times, November 16]

“Just shop around in the new marketplace. You’re going to get a better deal. […] Remember, before the Affordable Care Act, these bad-apple insurers had free rein every single year to limit the care that you received, or used minor pre-existing conditions to jack up your premiums, or bill you into bankruptcy.
—President Barack Obama, advising voters who don’t like the fact their health insurance plans are being cancelled for not complying with ObamaCare’s insurance regulations. [Reuters, October 30]

Politicians never think their ideas are wrong; they think the people just don’t know what’s good for them. And maybe they’re right. Think of how much better life could be if weren’t for the fact that it’s really hard to give people stuff they don’t want: Right now you could be driving a DeLorean on your way home from watching a USFL game, looking forward to watching your kids play lawn darts; then you could record the fun for later viewing on your Polaroid Polavision Home Movie System—while sipping a New Coke, of course. But unless we can go back to the future that people didn’t want, you’re out of luck.

Posted on 11/18/13 04:57 PM by Alex Adrianson

To Do: Applaud the Good Work of Some Young Conservatives

Recognize young conservatives who have made a significant contribution to the conservative movement in the past year. The Young Conservatives Coalition will hand out its Buckley Awards on November 19 at the Capitol Hill Club. The event will begin at 6 p.m. (See our post on the Buckley Award winners for more details.)

Journalists, apply for a Robert Novak Journalism Fellowship from the Fund for American Studies. The program provides full-time ($50,000) and part-time ($25,000) fellowships to working journalists with less than 10 years of professional experience to pursue writing projects “supportive of American culture and a free society.” Applications are due by February 11, 2014.

Learn about the historical roots of American conservatism. David Davenport will talk about his new book, The New Deal and Modern American Conservatism: A Defining Rivalry (co-authored with Gordon Lloyd), at The Heritage Foundation at noon on November 19.

• Keep sharing your stories of higher premiums, sky-rocketing taxes, and reduced care on the National Republican Congressional Committee’s Living Under Obamacare website.

Hear Sen. Marco Rubio’s thoughts on the false choice between dovish and hawkish foreign policy. Sen. Rubio (R-Fla.) will speak at the American Enterprise Institute on November 20 at 10 a.m.

Posted on 11/15/13 05:49 PM by Alex Adrianson

Know the Illogical Arguments Statists Will Make

There are lots of illogical arguments against libertarian ideas out there. Max Borders had cataloged 30 of them. Here are two:

The Unicorn: You’ll recognize this fallacy from the question, “Why does no libertarian country exist anywhere in the world?” Embedded in the question is the assumption that libertarian countries don’t exist because they are fantastic creatures, like unicorns. Of course, just because something doesn’t exist yet does not mean it can’t exist. Indeed, the Internet in 1990 and the American Republic in 1775 beg to differ. And the unicorn fallacy fundamentally confuses the libertarian worldview with some “L”ibertarian platform that might be the product of some electoral processes—processes most libertarians reject. Michael Lind and E. J. Dionne have brandished this fallacy rather shamelessly, and have had it parried rather effectively by better minds. […]

The We/Society Fallacy: This common form of hypostatization occurs when the user ascribes rational individual agency to “society” and conflates or confuses society with the State. Both usually happen immediately, or somewhere hidden, before the opponent even speaks. The opponent wants his moral position or emotional state to be reflected somehow in the organization of society. Although “we” or “society” is a useful ersatz word that appears to confer legitimacy on some aspect of the opponent’s claim, it is almost always an intellectual sleight-of-hand. Only individuals can act. Groups must work through processes of either collaboration or coercion. (Note: “The market” is often misused this way, by both supporters and detractors.)

For 28 more illogical arguments, see Max Borders article, “Effectively Irrational,” published by The Freeman, November 13.

Posted on 11/15/13 05:15 PM by Alex Adrianson

Two Awards for Promoting the Free Society

The Atlas Economic Research Foundation recognized a book and a think tank this week during its annual Liberty Forum, held this year in New York City. The book How China Became Capitalist by Ronald Coase and Ning Wang won the Sir Antony Fisher Memorial Award for the publication that made the greatest contribution to public understanding of the free society. Ronald Coase was a Nobel Laureate who died earlier this year and Ning Wang is a senior fellow at the Ronald Coase Institute. How China Became Capitalist was published by the Institute of Economic Affairs. The Atlas announcement states:

[The book] makes new claims about the role of spontaneous private behavior in driving economic reforms, with the Communist Party moving slowly out of the way. The authors detail major, mostly unplanned shifts such as private farming, street-level exchange, and regional competition, the latter serving to transform China into “a gigantic laboratory where many different economic experiments were tried simultaneously.”

Atlas also awarded this years’ Templeton Freedom Award to the TaxPayer’s Alliance for its campaign to reform Britain’s outdated and unfair tax system. The Atlas announcement states:

The TaxPayers’ Alliance team […] completed a strategic, multi-phase public education campaign, recruiting high-profile and influential figures to spend twelve months developing the economic, moral and practical case for lower taxes. The commission’s meticulous 417-page report reframed the debate over Britain’s economic growth strategies and became almost instantly influential, with more than 10,000 downloads its first week of publication.

The project played a critical role in achieving: a scheduled reduction in the Corporation Tax from 24% in 2012 to an expected 20% in 2015, with the system simplified by merging the standard and small business rates; a reduction in the top rate of Income Tax from 50% to 45%; and an abolition of the beer and motor fuel duty escalators.

Posted on 11/15/13 04:36 PM by Alex Adrianson

Young Conservatives Are Making a Difference

The Young Conservatives Coalition handed out its Buckley Awards this week to five young professional conservatives “who’ve made a significant contribution to the conservative movement at large in the last year.” Here is the list of the winners along with some highlights from the YCC’s announcement:

Yuval Levin, editor of National Affairs: “Levin has been the organizer of a group of devoted conservatives who are interested in creating a conservative reform agenda […] . He has been referred to as the ‘conservative movement’s greatest intellectual hope,’ an ‘expert rhetorician,’ and is even read by Rep. Paul Ryan (R-WI) […] .”

Will Weatherford, Speaker of the Florida House of Representatives: “Speaker Weatherford led his caucus of 76 members in opposition to an expansion of Medicaid through Obamacare. In the face of calls to expand Medicaid, a total of 75 of 76 Republicans in the Florida House held firm and as a result, stopped this legislation.”

Ryan T. Anderson, Fellow at The Heritage Foundation’s DeVos Center for Religion & Civil Society: “Justice Samuel Alito cited [Anderson’s] book [What Is Marriage? Man and Woman: A Defense] twice in his dissenting opinion in the Supreme Court case involving the Defense of Marriage Act. […] His […] ‘courage under fire’ was displayed in a memorable 2013 debate on CNN’s ‘Piers Morgan Live’ as he articulated his defense for traditional marriage in a viscerally intimidating environment.”

Alex Smith, National Chair of the College Republican National Committee: “Smith embarked on a nationwide effort to help rebrand the GOP, titled ‘Grand Old Party for a Brand New Generation.’ Her efforts led to commissioning a comprehensive nationwide report, with The Winston Group, utilizing numerous youth surveys and focus groups detailing how the GOP could win back the youth vote.” 

Remy Munasifi, video artist for ReasonTV: “Munasifi […] serves as an example of how conservatives and libertarians can fight the left using humor and social media outreach. […] In 2013, his timely videos received national acclaim with ‘Tap It: The NSA Slow Jam,’ the ‘Healthcare Mash,’ ‘Obamacare Video Contest Song,’ ‘Jim Carrey’s Cold Dead Hand – A Rebuttal,’ [and] ‘Blurred Lines: The Anthony Weiner Version,’ […] .”

Posted on 11/15/13 03:51 PM by Alex Adrianson

ObamaCare’s Assault on the Rule of Law Continues

On Thursday, President Obama reacted to the furor over people losing health care plans they liked by proposing to change ObamaCare’s insurance regulations through administrative discretion. You may have heard the term “administrative discretion” before in connection with ObamaCare. As Grace-Marie Turner observes, the Obama administration has changed how ObamaCare works by executive action at least 10 times since the law was passed. [Galen Institute, November 15]

But this latest “fix” is not a fix, explains Jonathan Adler:

According to the President’s announcement, insurance companies will be allowed to renew policies that were in force as of October 1, 2013 for one additional year, even if they fail to meet relevant PPACA requirements. What is the legal basis for this change? The Administration has not cited any. […] According to various press reports, the Administration argues it may do this as a matter of enforcement discretion (much as it did with immigration). In other words, the Administration is not changing the law. It’s just announcing it will not enforce federal law (while simultaneously threatening to veto legislation that would authorize the step the President has decided to take).

Does this make the renewal of non-compliant policies legal? No. The legal requirement remains on the books so the relevant health insurance plans remain illegal under federal law. The President’s decision does not change relevant state laws either.  So insurers will still need to obtain approval from state insurance commissioners. This typically requires submitting rates and plan specifications for approval. This can take some time, and is disruptive because most insurance companies have already set their offerings for the next year. It’s no wonder that some insurance commissioners have already indicated they have no plans to approve non-compliant plans.

Yet even if state commissioners approve the plans, they will still be illegal under federal law. Given this fact, why would any insurance company agree to renew such a plan? It’s nice that regulators may forbear enforcing the relevant regulatory requirements, but this is not the only source of potential legal jeopardy. So, for instance, what happens when there’s a legal dispute under one of these policies? Say, for instance, an insurance company denies payment for something that is not covered under the policy but that would have been covered under the PPACA and the insured sues? Would an insurance company really want to have to defend this decision in court? After all, this would place the insurance company in the position of seeking judicial enforcement of an illegal insurance policy. [Volokh Conspiracy, November 15]

Did anybody ask state insurance commissioners what they think? Apparently not. Here is part of a statement from Jim Donelon, President of the National Association of Insurance Commissioners:

For three years, state insurance regulators have been working to adapt to the Affordable Care Act in a way that best meets the needs of consumers in each state. We have been particularly concerned about the way the reforms would impact premiums, the solvency of insurance companies, and the overall health of the marketplace. The NAIC has been clear from the beginning that allowing insurers to have different rules for different policies would be detrimental to the overall market and result in higher premiums. 

We have expressed these concerns with the Administration and are concerned by the President’s announcement today that the federal government would use its “enforcement discretion” to delay enforcement of the ACA’s market reforms in 2014 for plans that are currently in effect. This decision continues different rules for different policies and threatens to undermine the new market, and may lead to higher premiums and market disruptions in 2014 and beyond.

In addition, it is unclear how, as a practical matter, the changes proposed today by the President can be put into effect. In many states, cancellation notices have already gone out to policyholders and rates and plans have already been approved for 2014. Changing the rules through administrative action at this late date creates uncertainty and may not address the underlying issues. [National Association of Insurance Commissioners, November 14]

Creating the kind of chaos that seems to justify extra-legal actions is one way for a President to give himself more power.

Posted on 11/15/13 02:14 PM by Alex Adrianson

Don’t Worry, You’ll Get Your Money’s Worth from ObamaCare as Long as You Do Stupid Things

“Not sure how I ended up here perched on top of this keg. I could totally fall, but that’s OK.”

That’s copy from one of the “DoYouGotInsurance” ads. You’ve probably seen some of the others that show young adults doing risky things but not worrying because they signed up for ObamaCare. On the surface, the message is that going without insurance is dumber than the things young adults usually do. The subliminal message, however, is that young adults should love ObamaCare because it lets them do stupid things even more frequently. In the world of insurance, that’s called “moral hazard”—when people behave differently because they’re insured.

Now why would the folks promoting ObamaCare find that message helpful in getting young adults to sign up? Probably, as Nick Gillespie explains, because it distracts from the reality that ObamaCare is a really bad deal for young adults—even if they get dumber:

Obamacare is simply the latest instance of generational theft being perpetrated against younger Americans. It’s a feature and not a bug of the President’s signature health care law that insurance premiums for those under 30 are likely to increase significantly to allow premiums for older Americans to fall. Indeed, the whole plan hinges on getting 2.7 million whippersnappers out of a total of 7 million enrollees to sign up in the individual market during the first year. If too many older and sicker folks flood the market, the system will crash even faster than the website. […]

There’s no reason to believe that even the greatest ad campaign in the world will jack up the youth numbers to where they need to be. Yes, young people foolishly believe themselves to be indestructible. But the actuarial truth is that most of them won’t ever need the sort of wide-ranging benefits mandated by Obamacare.

And given Obamacare’s ban on excluding people with pre-existing conditions and the relatively small financial penalties for not having insurance, the smart move for many people—whether young or old—is to wait until you actually need health care before shelling out for monthly premiums. [Time Magazine, November 25]

Posted on 11/15/13 02:12 PM by Alex Adrianson

Death Spiral Update

More people in England and Wales identified Jedi Knight as their religion in the 2011 census (170,000) than have signed up for ObamaCare so far. [, November 13]

The Department of Health and Human Services finally released some ObamaCare sign-up numbers this week, but the department’s figure of 106,185 indicates only the number who have “enrolled and selected a Marketplace plan” from either a state-run exchange or the federal exchange in October. Those folks are ObamaCare’s Potemkin village, explains Peter Suderman:

That’s really just an awkward way of saying that the report counts all the people who have done the equivalent of moving a plan into their online shopping carts—regardless of whether or not they have actually paid their first month’s premium yet. Given that those who don’t pay won’t be covered, this means that the true enrollment number so far is almost certainly significantly lower.

The report does provide a sense of how much the federal exchange network has struggled. Of the 106k plan selections, just 26,794, or about 25 percent, came through the federal exchange system, which includes Florida and Texas, two key large states where the administration has indicated that enrollment is critical to the law’s success.

The report’s state-by-state breakdown of plan-selection totals also offers some hints about the difference between the number of people who have taken the step of “clicking a button on the website page” and the number of people who have fully enrolled. For example, the HHS report lists 97 people as having selected a plan in the state of Delaware, one of the 36 states relying on a federal exchange, between October 1 and November 2. But the Associated Press reported last week that Delaware’s federally funded marketplace guides have successfully managed just four total enrollments in the state. [Reason, November 13]

As Suderman notes, “administration officials expected that about 500,000 people would enroll in private coverage through the exchanges during October.”

Posted on 11/15/13 02:09 PM by Alex Adrianson

Meet the New Social Engineering …

Obamacare’s stumbles are revealing the new social engineering—i.e., “libertarian paternalism”—to be just as wrongheaded as the old social engineering, writes Lee Lane:

With the rollout of Obamacare, the debate over the merits of libertarian paternalism ceased to be purely abstract. Obamacare was the first large-scale attempt to implement the principles of libertarian paternalism that, as its architects assured us, would make us all healthier, wealthier, and happier. Prior to the rollout, Obamacare’s architects were only able to present their designs in the form of abstract blueprints—blueprints which looked just as beautiful and elegant on paper as the collective farm movement had looked to its Soviet designers. Mandates would nudge the uninsured to buy health insurance. Since many of those who were uninsured were the young and healthy, this would allow insurance companies to lower costs for the old and sick. Federal subsidies would make health care cheaper for those less able to afford it. If all went according to plan, everyone would benefit and no one would lose.

Yet, like all schemes of social engineering, the blueprint for Obamacare was strikingly like one of the bizarrely complicated machines imagined by the great cartoonist Rube Goldberg, where a simple effect, like opening a bottle, was achieved only after a maddeningly roundabout series of oddball mechanical actions, where something could always go wrong, but miraculously never did. [The American, November 13]

Rube Goldberg did not have to fit human nature into his contraptions.

Posted on 11/15/13 02:08 PM by Alex Adrianson

ObamaCare Has Reduced Insurance Competition

In 39 out of 50 states plus the District of Columbia, there are now fewer insurers offering insurance on the ObamaCare exchanges than there were insurers offering coverage in the individual market, according to a tally from Ed Haislmaier. In only five states is there now more competition on the exchange than there was in the individual market, and in seven states there is no change. [The Heritage Foundation, November 12]

Posted on 11/13/13 06:02 PM by Alex Adrianson

Green Energy Is Bad for Bats; Aren’t They Part of Nature, Too?

Reports Michael Todd:

A new study published in the journal BioScience estimates that more than 600,000 bats died from interactions with wind turbines in the continental United States last year alone. Given the various issues bats have had with deadly white-nose syndrome, climate change, and that they generally only give birth to a single bat pup a year, this is a worry. How much of a worry is unknown, writes author Mark A. Hayes, a bat biologist at the University of Colorado-Denver: Since their subjects are small and nocturnal, researchers don’t have a good handle on how many bats are in the U.S.

Even if the population was known definitely, Hayes says his estimate of deaths—based on fairly elaborate “distribution-fitting analysis”—is almost surely on the low side, perhaps only two-thirds the real figure. [Pacific Standard Magazine, November 7]

Are 600,000 bat deaths per year something to worry about? Beats us, but we’re pretty sure that if coal could be blamed for killing that many bats, environmentalists would call it an ecological apocalypse. Comments Steven Hayward: “But since we don’t know [how big the problem really is], wouldn’t the ‘precautionary principle’ tell us to impose a moratorium on further windmill installations?” [Powerline, November 11]

Posted on 11/12/13 06:09 PM by Alex Adrianson

To Do: Share Your ObamaCare Story

• If you liked your plan, but couldn’t keep it, let the world know. Post a picture of your ObamaCare-induced health insurance cancellation notice to the Independent Women’s Forum’s website Or share your story at Heritage Action for America’s My Obamacare Increase website.

Peek into the dark world of the radical left. David Horowitz will discuss his experiences as a former Communist-progressive, as detailed in The Black Book of the American Left: The Collected Conservative Writings of David Horowitz. Horowitz will speak at The Heritage Foundation on November 12 at noon.

• Honor our nation’s veterans on Veterans Day, November 11. One way to do that is to see the film Honor Flight: One Last Mission, a documentary about efforts to give World War II veterans a trip to see the World War II Memorial in Washington, D.C. The film is showing in various theaters around the country. (At Marcus Theatres, veterans can see the film for free on Veterans Day.)

High school juniors and seniors, win a scholarship in the Foundation for Individual Rights in Education’s Freedom in Academia Essay Contest. The foundation will give first ($10,000), second ($5,000), and third ($1,000) prizes to the best written essays explaining why free speech is important at our nation’s colleges and universities. Submissions are due by January 1.

• If you want to find a job working for liberty in Texas, check out the Texas Public Policy Action’s Liberty Jobs Bank, “a central hub for Texas-based liberty-minded job creators and job seekers to connect.”

• Find out if the Federal Reserve was a good idea at the Cato Institute’s 31st Annual Monetary Policy Conference. The discussion will start at Cato at 9 a.m., November 14.

Take in an advance screening of Unlikely Heroes of the Arab Spring, “an eye-opening exploration of the volatile economic conditions that led to the 2010 Arab uprisings in the Middle East and North Africa.” The Illinois Policy Institute will host the screening of this Free to Choose Network documentary. The reception begins at 5:30 p.m. on November 13 at the ShowPlace Icon at Roosevelt Collection venue in Chicago. A panel discussion will follow.

Learn what fusionist conservatism is. Free Think University now offers Becky Norton Dunlop’s lectures on the topic as part of its Conservatism 101 series.

Posted on 11/08/13 05:40 PM by Alex Adrianson

Liberals, This Is Not the Argument You Were Looking For

Some liberals argue that low-wage-paying employers “cost” taxpayers money when their employees become eligible for public benefits. They haven’t quite thought through the implications of that argument, observes Andrew Biggs:

[The National Employment Law Project] has a new headline-generating report claiming that “Taxpayers are shelling out $1.2 billion a year to help pay workers at McDonald’s.” Overall, they state “the low-wage business model at the 10 largest fast-food companies in the United States costs taxpayers more than $3.8 billion each year.” Low fast food pay, the NELP logic goes, causes employees to become eligible for taxpayer-funded benefits such as Food Stamps and the Earned Income Tax Credit. If fast food chains paid a living wage, NELP argues, taxpayers would save billions.

The idea that welfare programs are a cost to taxpayers created by low-wage paying jobs implies that employers are able to employ their workers at a much lower wage than they would be able to offer absent welfare programs. Biggs points out what that means:

If NELP is right, though, that has important implications for how we view the welfare state. For instance, a dollar-for-dollar offset implies that federal transfer programs drive down working-class wages, since the higher benefits rise, the more wages fall. Thus, according to NELP’s logic, it is federal government policy that lies behind working-class wage stagnation in recent years.

This same logic also suggests that the hundreds of billions spent over decades on social transfer programs for the working poor have done nothing to raise the standard of living of beneficiaries, since every dollar is skimmed off by Ronald McDonald and the shareholders he fronts for. [RealClearMarkets, November 6]

In any case, the idea that people become willing to do the same job for less when the government gives them money makes no more sense than saying that a person becomes willing to take a pay cut because his rich uncle died and left him a fortune. Or, it makes no more sense than saying you found a $100 bill that you had forgotten about, so now you’ll have to lose five $20 bills from your wallet in order to make things even.

Posted on 11/08/13 05:07 PM by Alex Adrianson

The Bravest School Choice Activist

The story of Malala Yousafzai, the Pakistani girl that the Taliban tried to murder, isn’t being told correctly, reports James Tooley:

Education International, the global teachers’ union umbrella group, is typical. Malala is campaigning, they say, so that all can benefit from ‘equitable public education’; that is, government education. The BBC summary of her talk on her 16th birthday to the UN highlighted only ‘her campaign to ensure free compulsory education for every child’. […]

In fact, everything in her life story—related so beautifully in her just-published autobiography, written with journalist Christina Lamb—points to something importantly different. In her life story, she’s not standing up for the right to government education at all. In fact, she’s scathing about government education: it means ‘learning by rote’ and pupils not questioning teachers. It means high teacher absenteeism and abuse from government teachers, who, reluctantly posted to remote schools, ‘make a deal with their colleagues so that only one of them has to go to work each day’; on their unwilling days in school, ‘All they do is keep the children quiet with a long stick as they cannot imagine education will be any use to them.’ […]

In fact, Malala’s life story shows her standing up for the right to private education.

For the school she attended, on her way to which she was famously shot by the Taleban, was in fact a low-cost private school set up by her father. […]

A senior economist at the World Bank, Jishnu Das, suggests that in Pakistan generally there were 50,000 private schools in 2005; that meant one in three of all schoolchildren in private education, many of them attending the kind of low-cost private schools created by Malala’s father. […]

It’s not just in Pakistan. At least half of India’s villages have access to a low-cost private school, and they are estimated to serve the vast majority—70 per cent or more—of the urban poor. […] A study just completed in Lagos State, Nigeria, shows 73 per cent of primary-school-age children are in private schools. In the slums of Monrovia, Liberia, only 8 per cent of children use government schools; while 21 per cent are out of school, 71 per cent—from some of the poorest families on the planet—use low-cost private schools. [The Spectator, November 9]

Posted on 11/08/13 03:41 PM by Alex Adrianson

Politifact Lies About Checking Facts

Between 2008 and 2012, Politifact, the so-called fact-checking project at the Tampa Bay Tribune, ran six columns rating the truthfulness of claims regarding President Barack Obama’s various statements that under Obamacare people could keep their health insurance if they like it. That’s according to a tally by Sean Higgins at the Washington Examiner.

In none of those columns did Politifact hold the President accountable for telling a lie. The best Politifact could do was rate the President’s claim “half true.” It wasn’t totally false, Politifact reasoned, since “one of the points of reform is to change the way health care works right now.” Politifact might as well have said: “Anybody who looks into it must realize the claim can’t be true, so it’s not really a lie to say it.”

By the way, that reasoning, from an August 2009 column, perfectly tracks the liberal talking points now. Jared Bernstein, for example, defends the President by writing: “[A]s clearly stated at the time, if such a plan were to significantly change in ways that are inconsistent with consumer protections under the ACA, it would lose its grandfathered status. Like I said, this has been known since the law was written.” [On the Economy, October 29]

Higgins also observes that Politifact regularly engages in “goal-post moving”: While it purports to evaluate the truthfulness of statements, it’s really assessing the merits of ObamaCare from a liberal perspective. One example:

Politifact took another swing on June 28, 2012, the same day it was calling Romney a liar. This column reacted to Obama’s statement:

“If you’re one of the more than 250 million Americans who already have health insurance, you will keep your health insurance.”

It was his most definitive statement yet. Politifact noted: “Obama suggests that keeping the insurance you like is guaranteed.”

It nevertheless gave the president a pass because “many Americans already lose their current health plan for reasons that have nothing to do with the new law.” So, hey, what’s the big deal?

Politifact concluded: “Americans on balance benefit from the law’s provisions. We rate Obama’s claim Half True.” [Washington Examiner, November 4]

It’s getting harder and harder to tell a lie these days.

Posted on 11/08/13 12:50 PM by Alex Adrianson Earned a Send-Up from the Country Music Awards

Carrie Underwood and Brad Paisley borrowed from George Strait’s “Amarillo by Morning”:

Posted on 11/08/13 11:37 AM by Alex Adrianson

Cash for Clunkers’ Familiar Failure

Cash for Clunkers—in which the government gave vouchers for the purchase of a new car to people who turned in their old gas guzzlers—didn’t help the economy, didn’t help the poor, and it didn’t help the environment says a new report by Ted Gayer and Emily Parker. George Will summarizes:

Most of the 677,842 sales were simply taken from the near future. That many older vehicles were traded in—and, as required by law, destroyed. Gayer and Parker accept as reasonable an estimate that the cost per job created by the program was $1.4 million. […]

Because the program was not means-tested, it had only a slight distributional effect of the sort progressives favor: Voucher recipients had lower incomes than others who bought new cars in 2009. Against this, however, must be weighed the fact that the mandated destruction of so many used vehicles probably caused prices for such vehicles to be higher than they otherwise would have been, meaning a redistribution of wealth adverse to low-income consumers.

As for environmental benefits from Cash for Clunkers, the reduction of gasoline consumption was small and “the cost per ton of carbon dioxide reduced by [the program] far exceeds the estimated social cost of carbon.” [Washington Post, November 6; see also“Cash for Clunkers: An Evaluation of the Car Allowance Rebate System,” by Ted Gayer and Emily Parker, Brookings Institution, October 31]

But it was a preview of what can go wrong when the government tries to rig demand. Will, again, points to a key passage, this from a New York Times report:

 Around the country, dealers had put off the laborious task of applying for the rebates?[…] which requires entering the 17-character identification numbers of each vehicle to be scrapped, scanning images of proof of insurance and filling out other paperwork. The computer system was overloaded, according to the dealers. They said they would finish one page in the application, hit enter and nothing would happen. Eventually a message would appear notifying the dealer that the page had “timed out.” Tom Frew, the business manager at Galpin Motors in Los Angeles, said that he needed 35 tries to register just one of the company’s 11 dealerships on the day that the program opened because of problems with the government Web site. On Friday, he spent an hour processing just one rebate application, he said. [“In Congress, a Jump-Start for Clunkers,” by Matthew L. Wald, New York Times, July 31, 2009]

The history book on the shelf keeps repeating itself.

Posted on 11/07/13 08:57 PM by Alex Adrianson

There’s a Marriage Penalty in Obamacare

Garance Franke-Ruta explains:

Any married couple that earns more than 400 percent of the federal poverty level—that is $62,040—for a family of two earns too much for subsidies under Obamacare. “If you’re over 400 percent of poverty, you’re never eligible for premium” support, explains Gary Claxton, director of the Health Care Marketplace Project at the Kaiser Family Foundation.

But if that same couple lived together unmarried, they could earn up to $45,960 each—$91,920 total—and still be eligible for subsidies through the exchanges in New York state, where insurance is comparatively expensive and the state exchange was set up in such a way as to not provide lower rates for younger people. (Subsidy eligibility is calculated using a complicated formula involving income in relation to the poverty line, family size, and the price of plans offered through a state’s marketplace.) […]

“In the tax code, you have a different set of tax rates for married couples that mitigates the marriage penalty to some degree,” says Robert Rector, a senior research fellow at the Heritage Foundation who has been writing about the marriage penalty in health reform since 2010. Under Obamacare, however, there are “dramatic” penalties that are “substantial—particularly with couples in the upper age range,” he says.

“What you are doing is saying ... you have to pay a penalty of multiple hundreds of dollars—a substantial portion of your income—to stay married,” Rector says. “It’s saying society is basically hostile to the institution of marriage.” [The Atlantic, November 5]

Posted on 11/06/13 05:22 PM by Alex Adrianson

Health Care Entitlements Can Be Repealed, and History Proves It

Now that millions of Americans have been told the health insurance they had chosen to buy with their own money isn’t good enough under the new ObamaCare regulations and that they will have to buy more expensive insurance instead, perhaps it’s time to revisit the idea that federal entitlement programs can never be repealed after the benefits begin to flow.

Actually, that did happen once. In November 1989, Congress repealed the “Medicare Catastrophic Coverage Act of 1988.” The law provided new hospital services, home health care services, and a drug benefit for Medicare beneficiaries, while putting lower limits on out-of-pocket expenditures. But seniors didn’t like it. Ed Haislemaier wrote about the problems with the law at the time:

Responding to a flood of angry phone calls and letters from their elderly constituents, a growing number of Congressmen and Senators are seeking to repeal or revise the “Medicare Catastrophic Coverage Act of 1988” enacted in June of that year. The amount and the tenacity of elderly opposition to the law, particularly to the new taxes that will fund it, took many Congressmen by surprise. It also has provoked an open and widespread grass-roots rebellion within the nation’s largest senior citizen lobby, the American Association of Retired Persons (AARP), whose national office pushed hard for the original legislation. Already, some 30 bills have been introduced to repeal the catastrophic act in whole or in part or to change the way it is financed. More bills are expected. […]

The elderly understandably are most upset about the new income surtax used to fund two-thirds of the catastrophic act. The surtax penalizes prudent senior citizens who saved and invested for their retirement and those who choose to supplement their income by continuing to work. Worse still, the surtax rate is scheduled to increase annually with no limit. This makes the surtax a constantly escalating assault on the financial health and independence of America’s retirees. […]

When the program was enacted, the Congressional Budget Office estimated that the surtax would collect $21.7 billion in revenues in fiscal 1989 through 1993. The CBO now estimates that the new tax will collect $25.9 billion during that period. The Bush Administration puts the amount at $28.3 billion. [“Dealing with the Protests over the Medicare Catastrophic Coverage Act,” by Edmund F. Haislmaier, The Heritage Foundation, August 23, 1989]

Lesson: Everybody likes to hear promises of benefits but when they learn they will face significant new costs as part of the bargain their views of an entitlement program can shift quickly. People are now finding out how ObamaCare will cost them. [See also: “The Prospects for Ending Obamacare: Learning from Health Policy History,” by Robert E. Moffit, The Heritage Foundation, June 21, 2010.]

Posted on 11/05/13 05:17 PM by Alex Adrianson

A New Employment Bill Tramples Free Association

On Thursday, the Senate passee the Employment Non-Discrimination Act (ENDA). If it becomes law, the measure would make it illegal for organizations with 15 or more employees to “fail or refuse to hire or to discharge any individual, or otherwise discriminate against any individual […] because of such individual’s actual or perceived sexual orientation or gender identity.”

Aside from trampling Americans’ right to associate freely as they choose, there are some other problems with the law, observes Ryan Anderson:

ENDA also raises serious concerns regarding religious liberty. Although the bill provides some protections for religious liberty, they are inadequate and vaguely defined. They build on Title VII’s religious-liberty exemptions, which have been subject to repeated litigation with conflicting rulings by different courts.

Still, while it isn’t clear which religious organizations would be exempted from ENDA, it is clear that the bill would not exempt those who wish to run their businesses and other organizations in keeping with their moral or religious values. […]

Issues of sex and gender identity are psychologically, morally, and politically fraught. But we all ought to agree that young children should be protected from having to sort through such questions before an age-appropriate introduction. ENDA, however, would prevent employers from protecting children from adult debates about sex and gender identity by barring employers from making certain decisions about transgendered employees. […]

Moreover, whatever the significance of gender identity, we can’t deny the relevance of biological sex in many contexts. An employer would be negligent to ignore the concerns of female employees about having to share bathrooms with a biological male who says he identifies as female. Failing to consider these repercussions raises a host of concerns about privacy rights. But ENDA would prevent taking these concerns into account. [National Review Online, October 31]

Posted on 11/04/13 05:18 PM by Alex Adrianson

To Do: Discover Conservative Internationalism

Learn about the often overlooked conservative internationalism perspective on foreign policy. Henry Nau will talk about his new book Conservative Internationalism: Armed Diplomacy Under Jefferson, Polk, Truman, and Reagan at The Heritage Foundation at 11 a.m. on November 4. And if you can’t make that event, you can also catch him at 5:30 p.m. the same day at the American Enterprise Institute.  

Hear Benjamin Carson talk about his new book America the Beautiful: Rediscovering what Made this Nation Great at the Alabama Policy Institute’s Annual Birmingham Banquet. The event will start at 7 p.m. on November 7 at the Cahaba Grand Conference Center in Birmingham.

Students, meet fellow liberty lovers at the Students for Liberty Austin Regional Conference on November 9 in Austin, Texas. The University of Texas Libertarian Longhorns will host a full day of panels, breakout sessions, free food, and speakers including Ted Carpenter, Jeffrey Tucker, Dan D’Amico, Nick Capaldi, and Mimi Gladstein. It’s all free of charge and followed by a pizza networking social.

Pull back the veil on the Federal Reserve. The Cato Institute will host a screening of the movie Money for Nothing: Inside the Federal Reserve, a feature-length documentary on the workings of America’s central bank and its impact on our economy and our society. The event begins at 5:30 p.m. on November 6.

Find out how ObamaCare will affect Texas employers. The Texas Public Policy Foundation will host a briefing at the State Capital, Capital Grill in Austin on November 5 at 11:30 a.m.

Learn some lessons from Margaret Thatcher. Nile Gardiner and Stephen Thompson will talk about their new book, Margaret Thatcher on Leadership: Lessons for American Conservatives Today at noon on November 5 at The Heritage Foundation.

Posted on 11/01/13 11:23 PM by Alex Adrianson

Toolkit: What Not to Do When Seeking Foundation Grants

Here are three ideas for how to waste your time: Write one proposal and mail it to all foundation prospects, fail to follow up a negative response to learn more about a foundation’s interests, and fail to build a relationship with foundation officers over time. For more ideas on what not to do, see Michelle Taylor’s “Top 7 Time Wasters When Seeking Foundation Grants,” at The Nonprofit Partner.

Posted on 11/01/13 11:22 PM by Alex Adrianson

Nearly 1 Millions Canadians Are Waiting for Medical Procedures

In Canada’s single-payer health care system:

Wait times between 2012 and 2013 increased in both the segment between referral by a general practitioner and consultation with a specialist (rising to 8.6 weeks from 8.5 weeks in 2012), and the segment between a consultation with a specialist and receipt of treatment (rising to 9.6 weeks from 9.3 weeks in 2012). While wait times have fallen over all, physicians themselves believe that Canadians wait approximately 3 weeks longer than what they consider is clinically “reasonable” for elective treatment after an appointment with a specialist. […]

Data from this year’s survey indicate that in 2013, across all 10 provinces people are waiting for an estimated 928,120 procedures. This means that, assuming that each per son waits for only one procedure, 2.7 per cent of Canadians are waiting for treatment. [“Waiting Your Turn: Wait Times for Health Care in Canada, 2013 Report,” by Bacchus Barua and Nadeem Esmail, Fraser Institute, October 2013]

Posted on 11/01/13 10:51 PM by Alex Adrianson

A Win for Religious Liberty

Reports Julian Hattem for The Hill:

A federal appeals court on Friday struck down the birth control mandate in ObamaCare, concluding the requirement trammels religious freedom.

The D.C. Circuit Court of Appeals—the second most influential bench in the land behind the Supreme Court—ruled 2-1 in favor of business owners who are fighting the requirement that they provide their employees with health insurance that covers birth control.

Requiring companies to cover their employees’ contraception, the court ruled, is unduly burdensome for business owners who oppose birth control on religious grounds, even if they are not purchasing the contraception directly.

“The burden on religious exercise does not occur at the point of contraceptive purchase; instead, it occurs when a company’s owners fill the basket of goods and services that constitute a healthcare plan,” Judge Janice Rogers Brown wrote on behalf of the court. [The Hill, November 1]

Posted on 11/01/13 10:41 PM by Alex Adrianson

Bank Customers Are Paying for the Durbin Amendment

The Durbin Amendment, which instructed the Federal Reserve to impose maximum rates that banks could charge retailers for debit card swipes, is looking more and more like a classic case of price controls hurting the consumer. Wayne Brough notes one study finds “the Durbin Amendment transferred more than $8 billion from banks to retailers”; but banks are passing on the losses:

In fact, consumers have already felt the pinch of the price caps with the disappearance of free checking, and additional fees at banks and credit unions. Indeed, fees on checking accounts have increased by 25 percent since the passage of the Durbin Amendment. Despite the pro-consumer arguments made by the retailers, the real world application of the Durbin Amendment is not so consumer friendly. One credit union recently announced that the price caps will create $35 million to $45 million in losses, causing the credit union to revisit pricing on other consumer products such as mortgages and other loans. [Real Clear Markets, November 1]

David John said this would happen:

Faced with sharply lower profits from debit card use, card issuers are almost certain to react by doing one or more of the following: imposing an annual fee on debit cards; raising other fees that would be paid by consumers; or reducing the interest rates paid on consumer deposits. While such a response would hurt all consumers, it would especially damage those with moderate and lower incomes.

Increased fees on debit cards will discourage some consumers from using them. Instead, they might go back to using credit cards, which typically have higher fees and interest charges. In the wake of the recent recession and legislation that tightened regulatory controls on credit cards, many banks and credit unions have tightened credit standards by lowering credit limits, increasing interest rates and fees for certain cardholders, and refusing to issue cards to certain less profitable customers. [The Heritage Foundation, March 17, 2011]

Posted on 11/01/13 10:25 PM by Alex Adrianson

Socking It to the 27-Year-Olds

From the Texas Public Policy Institute, a snapshot of what ObamaCare is doing to the individual market in Texas:

For a 27-year-old, non-smoking male, low-cost catastrophic plans on the exchange, which are available only to those under age 30 or those with low incomes who qualify, will be on average 84 percent more expensive than pre-ACA catastrophic plans. For women, these plans will be 40 percent more expensive. Catastrophic exchange plans for men in Austin will be on average 158 percent more expensive than catastrophic plans prior to the ACA […] . Such plans are not eligible for subsidies, so the premium costs must be paid entirely by the enrollee, out of pocket. […]

A 27-year-old Houston resident earning 250 percent FPL, or about $28,725 annually, will only qualify for a subsidy of $8.40 a month, leaving more than $192 in out-of-pocket monthly costs for the second lowest-cost plan on the exchange.

A 27-year-old making $30,000 a year in Austin will not qualify for any federal subsidy at all, and will have to pay about $109 a month out-of-pocket for a low-cost catastrophic plan on the exchange, amounting to more than $1,300 annually. [“The High Cost of ObamaCare Mandates in Texas’ Individual Health Insurance Market,” by John Davidson, Texas Public Policy Foundation, October 2013]

Posted on 11/01/13 10:02 PM by Alex Adrianson

The Obamacare Alternatives Are Out There—and Always Have Been

When critics point out what’s wrong with Obamacare—for example, that forcing people to buy more expensive insurance isn’t a way to control health care spending—the law’s defenders invariably charge that the critics are just sniping, hoping the law will fail so that we can all go back to the previous system. “What’s your alternative?” they ask, as if conservatives just started talking about health care only after Obamacare was proposed. [Christopher J. Conover reviews the making of this myth: “Seriously? The Republicans Have No Health Plan,” Forbes, August 28]

Liberals of course, haven’t been paying attention. Conservatives have been talking about the maladies of the U.S. health care system many years before Barack Obama first ran for public office. In particular they’ve been pointing out that the health care system we had before Obamacare was not really a free market system, and that more competition and less regulation would give health care consumers more options at lower prices.

Before Obamacare came along, conservatives wanted to increase competition in health insurance by ending state laws that prevented consumers from buying health insurance from out-of-state insurers. See, for example, J. Patrick Rooney and Dan Perrin’s “For Better Health Insurance, Let Consumers Buy Across State Lines,” in The Insider, Summer 2008.

A related argument made by conservatives was that state regulations requiring health insurance to include coverage for specific services made health insurance more expensive, and that ending those coverage mandates would give consumers more economical options. See, for example, “The Effect of State Regulations on Health Insurance Premiums: A Revised Analysis,” by Michael J. New, published by The Heritage Foundation, July 25, 2006.

Even before Obamacare, the chief problem with the U.S. health care system was that most people most of the time were spending other people’s money. No wonder we spent too much. Health savings accounts are one way of fixing that problem. Some conservatives spent decades building the case for Health Savings Accounts. See for example, “A Brief History of Health Savings Accounts,” published by the National Center for Policy Analysis, August 11, 2004; and John Goodman and Gerald Musgrave’s book, Patient Power: Solving America’s Health Care Crisis, published by the Cato Institute in 1992.

The incentive to spend too much on health care as well as to organize the delivery of health insurance through the workplace comes from the tax code’s exclusion of employer-provided health insurance, as Milton Friedman explained in a 1996 Wall Street Journal article, “A Way Out of Soviet-Style Health Care.” Friedman proposed extending the exemption “to all expenditures on medical care, whether made by the patient directly or by employers, to establish a level playing field.” That idea would let consumers own their own plans that they could take with them from job to job.

Other conservatives have seconded this notion, while adding that the exclusion should be limited, since the tax preference makes health care seem relatively more valuable than non-health care spending. The exclusion also makes health plans offering first-dollar coverage appear attractive relative to plans that actually function as insurance. The proliferation of those plans, which were essentially pre-payment plans, drove health care spending up. See for example, “Health Care Reform: Changing the Tax Treatment of Health Insurance,” by Greg D’Angelo and Robert E. Moffit, published by The Heritage Foundation, March 16, 2009; and Letter to the President’s Advisory Panel on Federal Tax Reform, by Grace-Marie Turner of the Galen Institute and Dan Mitchell of The Heritage Foundation, June 27, 2005.

The foregoing annotated bibliography, of course, is but a few drops in the ocean of conservative literature on health care policy. We spent about 30 minutes digging that stuff up. Imagine if liberals had spent that much time looking into it. But now they don’t have to take even that much trouble. In August, the American Enterprise Institute released a plan that incorporates many of those free market reform ideas. It’s called “Best of Both Worlds: Uniting Universal Coverage and Personal Choice in Health Care.”

And now this week, the Heritage Foundation has released a statement of principles on health care reform: “After Repeal of Obamacare: Moving to Patient-Centered, Market-Based Health Care.” The Heritage principles include support for many of the ideas mentioned above, such as equalizing tax treatment of different kinds of insurance as well as capping the tax benefit, allowing cross-state purchase of health insurance, ending coverage mandates, and bolstering Health Savings Accounts which have already helped reduce health care expenditures. The Heritage plan also calls for reforming Medicaid with a premium assistance plan that would give Medicaid beneficiaries more choices, fighting Medicaid and Medicare fraud more aggressively, letting states pursue tort reform, and reforming state licensure laws that restrict the supply of doctors and certificate-of-need laws that restrict the supply of hospitals.

The key thing to remember is that conservatives are not and have never been in favor of the status quo ante. Getting to a real free market system requires doing more than just repealing Obamacare, and conservatives have spelled out what those other steps are.

Posted on 11/01/13 05:48 PM by Alex Adrianson

The President Meant to Say: “If I Like Your Health Plan, You Can Keep It”

So, did nobody bother to tell the President that lots of people do in fact like their plans?

Earlier this week, David Hogberg tallied numbers from news reports of health insurance cancellations this month; he reported that almost 1.5 million insurance cancellations have hit so far. [Amy Ridenour’s National Center Blog, October 28]

Health insurance industry analyst Robert Laszewski believes that as many as 16 million of the 19 million people covered in the individual health insurance market before October 1 have plans that will not be grandfathered at their next renewal. [Health Care Policy and Marketplace Review, October 17]

If you do the math, of course, you can’t both change the way health insurance works and force nobody to do anything differently. And sure enough, President Obama’s defenders are now claiming that everyone really understood this point all along.

David Henderson isn’t buying:

Imagine how different Obama’s rhetorical flourish would have been had he said: “And folks, the opponents of my plan are trying to scare you. But if you like your health insurance the way it is, and if I like your health insurance the way it is, then you can keep it.” [EconLog, October 29]

Neither is Megan McArdle:

We forget that when millions of people hear the president say that “if you like your insurance, you can keep it” and “premiums will fall by $2,500 for the average family,” they don’t listen with a wry smile. They don’t write it off as understandable hyperbole from a president who is working to pass a great law with a few flaws. They don’t think this speech means “I care about getting the best insurance for as many people as possible.” They think it means “if you like your insurance, you can keep it” and “premiums will fall by $2,500 for the average family.” If they didn’t think it meant that, they might not have supported the law.

That gap matters – not least because there’s a strong risk that when the people outside Expertopia finally figure out what everyone knew all along, they will turn on the people who allowed all that tacit knowledge to stay tacit. That’s what Democrats are now experiencing. It’s kind of surprising, in fact, that not everyone knew this was going to happen. [Bloomberg, October 30]

Posted on 11/01/13 04:19 PM by Alex Adrianson

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