Filed under: Capitalism, Economy, Freedom, Health Care, Progressivism, Regulation | Tags: Can't Tell What Free People Might Do, Fear of Freedom, The Left Demands Control
The late Milton Friedman had a way of clarifying the subject. Contrary to “conventional wisdom — health insurance does not make health care more affordable. Perhaps you have noticed.
In his masterpiece Free to Choose, Milton Friedman wrote of four ways to spend money.
- Category I — You spend your money on something for yourself. Here you are very careful, because it is your money, and the good or service you are buying is for you.
- Category II — You spend your money on something for someone else. Here you have the same incentive as in Category I to economize, but since you are buying something for someone else, you are not quite as meticulous when it comes to the purchase meeting the needs or values of the recipient.
- Category III — You spend someone else’s money on something for yourself. Here you are not concerned about how much you spend, because it is not your money. But because you are spending on yourself, you make sure you are getting what you want.
- Category IV — You spend someone else’s money on something for yet another person or persons (This is what we ask our legislative representatives to do every day.) Here you are the least incentivized to economize, or to buy something that meets the needs or values of the recipient.
Third party payers operate under Friedman’s Category IV — think Medicare and Medicaid. When the government buys goods or services for other people with other peoples’ money, special interest pleading, politics and cronyism run the game. And “leakage” of money through “waste fraud and abuse” is a given.
Private insurance companies are also spending other people’s money — the premiums paid into a risk pool — on medical services for other people. When they negotiate compensation schedules with providers and facilities, they don’t have to bargain hard enough to reach the best price possible. They just have to reach a price that is good enough — one that allows them to charge premiums that compete well with rival insurance companies. They pass on the difference between what they could have negotiated and what they actually negotiated to the customers who pay the premiums.
People who negotiate direct payment from providers get better deals than the insurance companies get. When health care providers give discounts for direct payment they don’t lose money on the process, or they wouldn’t do it. To keep from losing the direct-pay patient they need to keep their prices acceptable to those paying the bill.
The foregoing is from an article by Dr. Jeffrey A. Singer. It should give you glimmerings of how health care insurance could be better done. Health savings accounts, where tried, have been both extremely popular and extremely effective.
Here’s another example of how medicine can be more affordable and more effective. Competition improves everything. And that goes for insurance too. With stiff competition, insurers will bargain harder to get good prices. When insurance policies have to compete on a national basis, and policies are sold across state lines, costs will come down significantly. There are hundreds of good ideas from Republicans. Keeping costs down doesn’t have to be slashing payments to doctors and hospitals, increasing deductibles to astronomical levels — that’s a command and control theme, where the left is always stuck. They just can’t give up control.
A small company called 23andMe offers a genetic-testing kit. It consists of a tube into which the customer spits and returns to the company. The actual test is conducted at a lab that is regulated by another agency. The FDA has chosen to go after 23andMe aggressively for marketing a “medical device” even though the only “device” is a plastic tube, and the client cannot cannot undertake further action on the test result without consulting a health care provider. This kind of device is part of the new economy, favoring the free flow of information. It is completely at odds with the old paternalistic model, in which regulators and the medical establishment control what patients may learn.
Liberals place great faith in the perfectibility of politics. They believe that the next law or the next regulation will make up for imperfect human nature. Freedom, to be sure, is frightening. There is no telling what values free people will hold, or even what they might do. That’s why they are so frightened by the Tea Party. They must be controlled.
Filed under: Capitalism, Democrat Corruption, Domestic Policy, Economy, Politics, Progressivism, Regulation, Taxes | Tags: Kills Innovation, Kills Jobs, Regulators' Hubris
Somewhere along the way, Congress got lazy and decided it would be better if they palmed off the annoying business of writing laws and regulations on the myriad federal agencies, and then they wouldn’t get so much disagreement from ordinary citizens, and they could do more important things like make speeches and fund raise.
Delegating such tasks to unelected bureaucrats has meant not only the vast expansion of am alphabet soup of agencies, but laws that sound as if they are written by faceless, unelected bureaucrats. Nobody understands the laws, every t may be crossed and i dotted, and every possible dereliction from the law may have its penalty and every regulation may attempt to control ever more of the actions of the public., but it’s not working and it should be stopped.
Agencies are working at cross purposes, regulations are based on inadequate understanding of economics, and caught between the proverbial rock and hard place, businesses close or decline to open, jobs are lost or are never created but the regulatory machine churns on unabated. The regulators remain completely unconcerned about their vast hubris, for they are convinced that they know better than the rest of us what is good for us.
Consider the 20,000 pages of the ObamaCare act which has not managed to be intelligible to anyone after 3½ years. Contrast that with the clean simple law of the Homestead Act of 1862: simple, clear language, 21,296 words that transformed the United States and populated the country. We could do with a lot more clear language and a lot less regulation.
A small company called 23andMe offers a genetic-testing kit. It consists of a tube into which the customer spits and returns to the company. The actual test is conducted at a lab that is regulated by another agency. The FDA has chosen to go after 23andMe aggressively for marketing a “medical device” even though the only “device” is a plastic tube, and the client cannot cannot undertake further action on the test result without consulting a health care provider. This kind of device is part of the new economy, favoring the free flow of information. It is completely at odds with the old paternalistic model, in which regulators and the medical establishment control what patients may learn. Walter Olson, a senior fellow at the Cato Institute said there are sound legal reasons for the FDA to have refrained from acting in this case. But you can’t fight city hall, or a federal regulator. They will perhaps move offshore, jobs will not be created, and regulatory excess trumps citizen health.
The EPA decided that the Renewable Fuel Standards, which would require the use of 35 million gallons of alternative fuels by 2017, would promote clean energy. Unfortunately the technology for producing some kinds of biofuel did not exist. The goals failed to take into account the difficulty of turning that much corn into fuel, scientific studies demonstrated that engines in older care would be damaged by the new fuels. And government agencies and the military are required to buy significant amounts of a fuel that does not exist.
Hubris reigns, common sense evaporates, and citizen’s respect for government goes a glimmering. They brought it upon themselves. As somebody remarked the other day, when the government refuses to obey the laws, rewrites them to suit themselves, and imposes silly regulations that destroy businesses and lives, pretty soon the people will act on the example, and decide that they don’t need to follow the regulations or the laws, and then where are we? Innovation goes where it is appreciated. Job growth will go where it is wanted.
Filed under: Foreign Policy, Intelligence, Iran, Israel, Middle East, National Security, Progressivism, Terrorism | Tags: John Kerry's Incompetence, The Geneva Accords, The Islamic Republic of Iran
So many of President Obama’s policies leave one puzzled. What can he possibly be thinking? Why would he do this? Why would he assume this to be a good idea? Particularly in the case of the interim agreement that the United States and its partners cut with Iran last week in Geneva which seems to be a centerpiece of President Barack Obama’s foreign policy. The core objective of the past two decades — preventing Iran from acquiring nuclear weapons — and threatening fundamental regional and global interests have been ignored. Nuclear proliferation in the Middle East, strengthening the forces of radicalism and terrorism in the region — what can he be thinking?
We have compared Obama to Neville Chamberlain, the British prime minister who pursued a policy of appeasing Adolf Hitler, and agreed to the Nazi demand that Czechoslovakia should cede the Sudetenland to Nazi Germany to stave off a threatened invasion — without consulting the Czechs.
Obama does manifest some of Chamberlain’s trusting naïveté and insular self-righteousness. More important perhaps, like Chamberlain, Obama thinks his job is to accommodate domestic war-weariness and to keep us out of foreign conflicts. Also like Chamberlain, Obama in the Middle East has inclined toward appeasing Muslims at the expense of Jews in the Holy Land. And like Chamberlain, Obama will go down in history as a failed leader of the leading Western democracy, one whose policies will have to be reversed—one hopes this time at less cost—by his successor.
Churchill succeeded Chamberlain in 1940 and saved the West.
The Obama administration apparently believes that the supreme leader might forsake his historic quest for nuclear weapons begun under the Ayatollah Khomeini and carried forth under Khamenei and every Iranian president. The United States, “the epicenter of evil” has rallied the West against the Islamic Republic.
The idea seems to be that the supreme leader, and his Revolutionary Guards who control the nuclear program, terrorist operations and domestic riot-control aren’t sufficiently committed to developing a nuclear weapon that the persuasive voices of moderation from the Obama administration can seduce them from this dangerous path. Um, they seem to believe that the newly elected president Hassan Rouhani, and foreign minister Mohammad Zarif are forces for moderation. The evidence for this is a nice smile and a lot of fantasy. They believe that Rouhani must be a reformer — he has a PhD from a Scottish university. Ruel Marc Gerecht, who is an expert, spells out the evidence for fantasy. Do read the whole thing.
At the core of Washington’s debate about Iran’s nuclear program is a confluence of naïveté and fear of another war in the Middle East. The latter reinforces the former and bends the analysis of Iran’s internal politics. It makes America’s foreign policy elite, which has never been a particularly God-fearing crowd, even more blind to the role of religion in Iran’s politics. The president himself appears to believe passionately that an irenic American foreign policy insulates the United States from Muslim anger and terrorism.
No one in the Middle East believes that Obama would order a strike. The Washington foreign-policy establishment have conceded the bomb to Iran. They argue for “containment.” The only thing that matters is that we will not bomb Iran’s nuclear sites. Most on the Left do not envision any need for a militarily strong and aggressive America pushing back against Iranian adventurism. Containment is a synonym for patient, peaceful engagement and American withdrawal. Gerecht summarizes:
President Obama’s eagerness to avoid an unpleasant binary choice—surrender publicly to Tehran’s nuclear fait accompli or preempt militarily—will have led him to a situation where he confronts the same choice, but with Iran’s hand stronger and America’s weaker. Khamenei will have called Obama’s bluff—and will have billions more in his bank account. In all probability, the president has bought into a process of diminishing returns that he cannot abandon for fear of the cruel binary choice. For that matter, he may already have decided that the left-wing of the Democratic party is right.
Well, that’s what we get when the president can’t be bothered to attend his intelligence briefings. Does he worry at all about the new ICBMs being developed by North Korea and Iran?
Dan Bongino, former Secret Service member, now running for Congress in Maryland, has said that the White House staff were like kids with a shiny new toy. No one knew anything about government, and they treated the president like a cult figure — if he said it, it must be true. Nothing could be more dangerous than an ideologically-driven megalomaniac surrounded by obsequious yes-men in the White House.
Filed under: Capitalism, Economy, Freedom, Politics, Progressivism, Regulation, Taxes | Tags: The Cost of Compliance, The Magic Economy, The Problem of Regulation
It must be pleasant to look out the windows at the Rose Garden and see the unicorns at play. As President Obama said in his weekly address, there are some silver linings to be found in the economy.
Actually he said “most of the headlines you’ve read have probably been about the government shutdown and the launch of the Affordable Care Act…but if you look beyond those headlines there are some good things happening in our economy. And that’s been my top priority since the day I walked into the Oval Office.” There he goes again.
Nobody believes anymore that improving the economy is Obama’s top priority. The brightest spot in the economy is the energy boom in America’s shale deposits, which is making America energy independent. This success has happened entirely in the private sector on private lands, much to Mr. Obama’s annoyance.
Oddly enough, a big chunk of the increases in hiring has been in compliance officers. The administration’s drive to regulate everything proceeds apace. But regulatory agencies don’t consider the impact they have on labor markets, even though they have been subject to requirements that they consider the effect of regulatory change on the economy.
In America, the administrative state traces its origins to the Progressive movement. Progressives believed that the triumph of the modern state marked an “end of History,” a point at which there is no longer any need for conflict over fundamental principles. Politics would give way to administration which would become the task of neutral and highly trained experts.
Regulation raises the cost of production, which leads to higher prices and reduced output. This causes job loss in the regulated industry. Job losses include lost wages, job search costs and retraining costs. Higher prices for regulated goods and services raise costs in other industries and lower the buying power of consumers. These too can impact jobs.
If you think in terms of ObamaCare, the idea is that neutral and highly trained expert bureaucrats will tell highly trained physicians how to care for patients, and highly trained bureaucrats will tell insurance company actuaries how much they should charge for insurance benefits. You see the problem.
Obama has repeatedly denied Republican assertions that over regulation is a problem, yet data from the Bureau of Labor Statistics shows an 18 percent increase in the number of compliance officers in the U.S. between 2009 and 2012. At last count there were an estimated 227,500 compliance officers employed. Those numbers do not include professions like bank examiners, tax collectors or Occupational Safety and Health Administration inspectors who monitor companies for fraud and safety violations.
Reform advocates argue that the private sector was left without proper oversight for too long.
Um, Benghazi, Cash for Clunkers, the IRS, Solyndra, Fast and Furious, EPA overreach, falsifying job numbers, auto bailout, seizing AP phone records, EPA attack on coal companies, the Keystone XL Pipeline, firing Inspector Generals, and it’s the private sector that has been left without proper oversight?
The pages in the Code of Federal Regulations hit an all time high of 174,545 pages is 2012. In 2012, the cost of federal rules exceeded $1.8 trillion, and regulatory burdens cost each U.S. household $14,768.
Private business has been telling the administration for nearly five years that over-regulation is a problem, but the administration denies it. Progressives know better. So the result is that the President of the United States looks out the windows of the White House at the unicorns playing in the garden, and explains to the people in his weekly address that there are some silver linings to be found in the economy. We need only 8.0 million jobs to get back to the pre-recession unemployment rate, which will take around five years.
Filed under: Democrat Corruption, Domestic Policy, Economy, Health Care, History, Progressivism, Regulation | Tags: The Kennedy Assassination, The ObamaCare Debacle, The Republicans Fault?
ObamaCare’s failures can be partly blamed on the failure of Republicans to applaud it enthusiastically enough. The Washington Post writes:
President Obama on Tuesday sought to redirect some of the political blame for the botched rollout of the federal health insurance exchange to Republicans, characterizing GOP lawmakers as rooting for the law’s failure. …
Obama said that fixes to the HealthCare.gov Web portal are underway and that the exchange will function for a majority of people by the end of November. But the president said staunch opposition from congressional Republicans is inhibiting the law’s implementation.
How does that work? Republicans can do no more than speak out against the law and the fallout from its implementation. The problems are a direct result of the failed rollout, Obama’s continuing lies to the public, and public recognition that the law is for the most part disastrous for them. It really isn’t failing because the Republicans say it is junk insurance. It is junk insurance.
Well, yes. The Affordable Care Act passed with no input from Republicans and every Republican in the House and the Senate voted against it, because it is a fraudulent law and will do great damage to the country and the people. Management of the Act has been beyond incompetent. Millions of people have lost the insurance they preferred and are stuck with junk insurance with higher premiums and deductibles for coverage they did not choose. You expected a Republican cheering section for a bad law that you consistently lied about?
So naturally Obama is going to “pivot to the economy” again. Expect infrastructure talk. Unfortunately, the economy is not improving. Businesses are hiring for the wrong reasons. U.S. News notes:
Businesses have increased the hiring of compliance officers in recent years to help manage the growing number of complex federal rules and regulations. While increased hiring is generally welcome news in the current labor market, it’s important to realize that a regulatory system that prompts the private sector to bring on employees whose sole purpose is to evaluate conformity with laws and regulations reduces productivity, raises the cost of production and has a negative impact on the economy.
Unfortunately, proposed government regulations often ignore the economic cost of job loss in the regulated industry. For instance, if an agency adopts a regulation that increases the costs of energy production, energy companies have to either lower production, raise prices, hire fewer workers or consider some combination of the three.
With the 50 year retrospective of the Kennedy assassination this week, the New York Times and the Washington Post each published pieces by two different authors who attempt to implicitly blame “the right-wing extremist environment in Dallas in 1963 for the Kennedy assassination on that environment. The Washingtonian is more explicit, “The City of hate had, in fact, killed the President.” The Left has long refused to accept the idea that JFK was killed by a Communist, who was committed to the communist cause, who had defected to the Soviet Union, and would have gone to live in Cuba.
The blame game never ends. The ideology of the Left promises a glorious future. They cannot admit the failure of ideology, so they blame Republicans. Fifty years later and they still cannot admit that JFK was killed by a Communist.
Filed under: Politics, Domestic Policy, Economy, Health Care, Liberalism, Democrat Corruption, Progressivism, Statism | Tags: "Doc Shock", Administration Incompetence, It is Known as ObamaCare
The White House knew all along that the “you can keep your policy if you like it” was pure hogwash. But perhaps the worst slip-up was the president’s admission that— gee, he didn’t know. He wasn’t informed that the website would not be working the way it was supposed to. Is this simply the usual “don’t blame me” evasion, or to what extent was he simply uninformed — and uninformed is not an acceptable excuse.
Reporters have been caught with their journalism degrees tucked safely away in some drawer, and they are beginning to realize that they didn’t ‘read the bill to find out what is in it’ either. Nancy Pelosi said no one ever told her that they liked their health care policy. Funny, it has never come up in my conversations with friends either.
Some few reporters are beginning to realize that they have been had, along with the rest of us. Some are free-lancers and are learning about ObamaCare first hand. So there are new revelations daily. We have learned that Obama seldom attends his intelligence briefings. We have learned that the White House staff is also inept. Their job is to keep the president informed about everything. The Chief of Staff is supposed to keep things faultlessly organized. Any president needs a team of competent people to can keep him and his projects humming along faultlessly. Not only are there serious questions about that signature initiative, but there are serious questions about the competence of the White House.
The White House is spinning like mad, attempting to find better vocabulary, to sell the unsaleable. ObamaCare will no longer be called “Obamacare” but referred to only as the Affordable Care Act. Dennis Miller tweeted that’ he would call it the Affordable Care Act when Obama changed his name to Barack Affordable.’ Most people will call it Affordable when it becomes affordable.
Democrats point to examples of people who have gotten cheaper premiums through the ACA. But lower premiums are the result of restricting provider networks. Pundits are calling it “Doc Shock.” We are already hearing stories of patients who are surviving their cancer because of specific treatment from specific doctors — and under ObamaCare are losing those doctors. Here in the Northwest:
In one closely watched case, Seattle Children’s Hospital has filed suit against Washington’s insurance commissioner after a number of insurers kept it out of their provider networks. “It is unprecedented in our market to have major insurance plans exclude Seattle Children’s,” said Sandy Melzer, senior vice president.
A number of the nation’s top hospitals — including the Mayo Clinic in Minnesota, Cedars-Sinai in Los Angeles, and children’s hospitals in Seattle, Houston and St. Louis — are cut out of most plans sold on the exchange.
Those who are defined as “poor” are being funneled into Medicaid, but most doctors will not accept Medicaid patients. Newly minted doctors avoid general practice, and train for a specialty. The problem is that Democrats view doctors as part of “the rich,” and Obama’s all-encompassing share the wealth ideology believes that :
Fat cats” and “corporate jet owners” have preyed on the body politic. Profit-driven doctors have unnecessarily lopped off limbs and yanked out tonsils. In a more philosophical vein, Obama advised that an individual should recognize a point beyond which he need not make any more money. The subtext is always that in this zero-sum world, personal success comes not through the individual’s efforts, but at the expense of someone else.
The multimillionaires in Congress and in the administration are, of course, different. They are doing “public service” and helping to transform America. They get raises. Patients on Medicaid will have trouble finding a doctor, will have long waits to see one, and will soon be assigned to nurse practitioners rather than physicians. Ignorance of basic economics keeps them from understanding that increased regulation means hiring more people to keep up with the paperwork requirements.
The Affordable Care Act was not intended just to extend health insurance to the uninsured or to decrease premium costs. Indeed, so far Obamacare has had the opposite effect of raising costs and increasing the numbers of the uninsured. Aside from growing government, increasing federal jobs, and limiting free choice, Obamacare federalized healthcare to ensure Americans fairness, defined as the economic equality of result as technocrats decide who had wrongly acquired too much healthcare, who unfairly had access to too little, and so on.
Victor Davis Hanson, as usual, is spot on in his essay about “The Politicization of Everything.“ Do read the whole thing.
Filed under: Domestic Policy, Democrat Corruption, Progressivism, Statism, Election 2012, Election 2014 | Tags: Hiding the Truth, Chicago Politics, 'Till After the Election
With all the revelations about ObamaCare, the terrifying escalation of costs for an individual health care policy and the accompanying drastically larger deductibles, Democrats are plainly worried about the 2014 midterms. So the Obama administration is back to its old tried and true tricks.
Health and Human Services plans to delay the start of the second year of Obamacare enrollment by one month to allow insurers more time to set rates after assessing their plan experiences during 2014, a department official said Thursday night.
The decision means that sign-ups for the 2015 plan year would begin on Nov. 15, 2014 and end on Jan. 15, 2015 instead of the Oct. 15-Dec. 7 window previously announced. The date change, first reported by Bloomberg, also lengthens the enrollment period by a week. Doing so would give companies more opportunity to account for individuals, particularly young adults, who come in late during the plan’s first year, which has gotten off to a rocky start. The goal is premiums that more accurately reflect costs for those insured.
The new calendar would move the start of the 2015 open enrollment season to shortly after the November midterm elections.
This is nonsense. Insurers calculate the changes from the previous year every year in setting new rates. They haven’t forgotten how to do it just because of Kathleen Sebelius. So far the federal government has been unable to convince healthy young consumers to buy comprehensive health insurance they don’t need, to pay for everyone else. This will force premium increases on everyone else to pay for the lack of the young. Letting people know how much the ObamaCare policies they are being forced to buy are going to cost them just before an election is, um, unfortunate timing. Which of the Chicago bunch was it who said “elections are too important to be left to chance?”
Employer-provided group health insurance is where costs will either skyrocket, or consumers will be kicked out of their group coverage altogether. There’s going to be a lot of outrage when it hits home for company employees.
I used to consider government departments as often inept as all bureaucracies are, but not as agencies involved in attempting to change election outcomes by manipulating data and calendars and changing regulations. Americans traditionally and rightly don’t place a lot of trust in their government. They really do work for us — and you have to keep an eye on your employees.
This president, however, has gone to extraordinary lengths to politicize government departments to achieve his political aims. What the long-term damage to the country will be, we will learn in coming years. That there will be long-term damage is assured.
Filed under: Capitalism, Democrat Corruption, Election 2014, Freedom, Health Care, Liberalism, Progressivism | Tags: It's Not a Health Policy, Redistribution of Wealth, Stick it to the Healthy Young
ObamaCare is meant not as a health policy, but as a mechanism for redistribution of wealth, created in the guise of medical insurance. By insisting that people pay for what they do not need, it is in effect a mandated policy imposed on the young and healthy, who are asked to pay big bucks for things they don’t need, to cover the costs of older people on the exchanges whose medical needs they will be paying for.
That is the big secret behind the cancellation letters people are receiving, and why people who get policies through their employers will find the firms they work for dropping their policies and forcing them into the exchanges as well. It was meant to do exactly that, because otherwise the whole program would collapse.
Ronald Radosh quotes a Facebook post from University of Chicago political scientist Charles Lipson who explains its meaning:
Why do I keep emphasizing the fundamental problems with Obamacare? Not just because I think it is a full-scale public policy shambles, the worst domestic policy mistake since high-rise public housing. Not just because I think the President either didn’t understand his own signature achievement or else he deliberately deceived the public when he said you could keep your policy and your doctor. Not just because the same problems that affect individual insurance policies will swamp group plans next year. Not just because I think the President’s statement yesterday was lawless when he said he would simply ignore the ACA’s specific provisions. (What happened to his constitutional oath to faithfully execute the laws?) All these are indicia of a deeper problem: Washington has become an overreaching Nanny State, run by smug elites who know better than ordinary people what we should do, think, buy, invade, or snoop on. This Nanny State is precisely the GOAL of this administration, sometimes nudging but more often simply ordering. It goes well beyond providing an essential safety net, which I favor. It starts to mandate more and more behavior, strip away the liberties of a free people, transfer wealth for the sake of distributional equity, and muddle headlong into complex markets with no understanding of the unintended consequences. That is EXACTLY what you are seeing with Obamacare. It raises the most fundamental questions about the country’s future–ultimately a choice between a European-style social democracy and an American-style central government of limited and specified powers.
This is Barack Obama’s “fundamental transformation of America” that was his goal. And how do you like it now?