American Elephants


ObamaCare Comes Before the Court Next Week. by The Elephant's Child

ObamaCare will be argued next week in the Supreme Court. The justices will be considering the application of the health care law in the light of the United States Constitution. While the justices consider the constitutionality of the law, most of the arguments have to do with the economics of the law.

We were lied to in the first place, directly and purposefully. It was necessary for Democrats to drum up nationalized health care in the back rooms of Congress, because the costs of health care were spiraling out of control, and the only solution was socialized medicine the Affordable Care Act and Patient Protection something or other.  That was not true. Medical costs had been moving downwards towards the normal rate of inflation for a decade. There was NO emergency.

Consider the individual mandate to purchase health insurance. The Obama administration defends the mandate on the ground that a person’s decision to not buy health insurance affects commerce by materially increasing the costs of others’ health insurance. The government adds that health care is unique and therefore can be regulated constitutionally in ways other markets cannot.

The government’s other defense is that the health-care market does not exhibit textbook competition. No market does. The economic features relied upon by the government…are characteristic of many  markets.

Health care, Douglas Holtz-Eakin, and Vernon L. Smith point out, is typically consumed locally, and health-insurance markets themselves primarily operate within the states.

The administration’s attempt to fashion a singular, universal solution is not necessary to deal with the variegated issues arising in these markets. States have taken the lead in pas reform efforts.  They should be an integral part of improving the functioning of health-care and health-insurance markets.

Mr. Holtz-Eakin is a former director of the Congressional Budget Office, and president of the American Action Forum. Mr. Smith is a professor of economics at Chapman University and the 2002 Noble Laureate in Economics.

Professor Richard Epstein argues that the health law’s expansion of Medicaid is problematical. An expenditure of federal funds is unconstitutional when it coerces states rather than encouraging them to participate in a federal policy. ObamaCare transforms Medicaid from a health-care program for the poor into a mandatory federal entitlement— obligatory on both the states and the beneficiaries alike.

What the Supreme Court will do is completely unknown. Speculation does not help. Kind thoughts, prayer, voodoo dolls and worrying probably won’t help either, but  you might try your favorite remedy anyway.


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