Our Screwed Up Health Care System In Two Charts

March 15, 2017

Two charts show the problem with our health care system.

First, from FreedomAndProsperity.org:

And then from the Wall Street Journal:

This is the perverse outcome created by the third-party payer public programs and the tax and regulatory provisions tilted in favor of third-party payer insurance: consumers’ pocketbooks are hit more and more for health care costs despite the fact that consumers pick up less and less of the tab for total health care costs.

Obamacare reinforced this trend with its various regulations. The Republican alternative, which trades subsidies for “tax credits” and punishes consumers for not maintaining third-party coverage, further reinforces the trend. Until true free market reforms (deregulation, ending tax code distortions) are introduced, these trends will only continue.

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The Republican Prescription To Health Care “Reform”: An Individual Mandate

March 11, 2017

Another aspect to the Republicans’ health care bill that’s starting to get attention: a revision of Obamacare’s reviled individual mandate. From CNBC:

The Republican plan would require anyone who has a lapse in their coverage of longer than 63 days in the prior year to pay their insurer a penalty equal to 30 percent of the premium of the individual or small group health plan they are purchasing.

The Commonwealth Fund, which produced the analysis, said there were 30 million working-age adults who reported having a gap in insurance coverage that was longer than three months.

These penalties, per CNBC, could end up being more punitive on lower income people than Obamacare’s “the higher of $695, or 2 percent of household income” penalty.

Are Republican voters having buyer’s remorse yet?

Obamacare 2.0 (Or Republican Health Care “Reform”)

March 8, 2017

For years, I’ve blogged how the third-party payment structure for routine health care is the source of problems with America’s health care system. Addressing this problem would be true reform. There are real-world examples of this in action, and the results are promising. True reform would address the regulations and tax-code distortions that favor third-party payments.

Obamacare reinforced the third-party payment structure. It continues to fail.

So what are Republicans proposing? It ain’t good:

It would repeal far less of ObamaCare than the bill Republicans sent to President Obama one year ago. The ObamaCare regulations it retains are already causing insurance markets to collapse. It would allow that collapse to continue, and even accelerate the collapse.

Michael Cannon has the gory details.

Not surprisingly, this bad legislation garners President Trump’s endorsement.

The Threat Of Trumpism

February 19, 2017

Brian Doherty has written a long, thoughtful piece on the threat posed by the Trump presidency:

Given the nature of human beings’ productive powers, the best way to ensure the collective “we” gets richer faster is to ensure the individual freedom to exchange with others as we choose, and by doing so build long and complex chains of production and exchange that benefit us all (or even just some/many of us), irrespective of accidents like national boundaries.

Free trade and free migration are, then, the core of the true classical liberal (libertarian) vision as it developed in America in the 20th century: if you don’t understand and embrace them, you don’t understand liberty, and you are not trying to further it.

The Trump administration may not in every specific policy area do the wrong thing in libertarian terms. But whatever it gets right is more an epiphenomenon of certain alliances within the Republican Party power structure or the business interests he’s surrounding himself with. Trump and his administration can’t be trusted to have any principled and reliable approach to shrinking government or widening liberty, since Trumpism at its core is an enemy of libertarianism.

Today’s Dose Of Trump Authoritarianism

February 8, 2017

After being told by a sheriff about a policy that would require people to have been convicted of a crime before police take their assets, Mr Trump encouraged law enforcement to make the name of the politician public.

“Who is the state senator? Do you want to give his name?” Mr Trump asked during a meeting at the White House. “We’ll destroy his career.”

Because heaven forbid we introduce a little due process in America.

Full story here.

Infrastructure Spending Boondoggles

February 6, 2017

More evidence that undergoing major infrastructure spending, as President Trump proposes, would be foolish for boosting economic growth:

Performance data for megaprojects speak their own language. Nine out of ten such projects have cost overruns. Overruns of up to 50 percent in real terms are common, over 50 percent not uncommon. Cost overrun for the Channel Tunnel, the longest underwater rail tunnel in Europe, connecting the UK and France, was 80 percent in real terms. For Boston’s Big Dig, 220 percent. The Sydney Opera House, 1,400 percent. Similarly, benefit shortfalls of up to 50 percent are also common, and above 50 percent not uncommon.

As a case in point, consider the Channel Tunnel in more detail. This project was originally promoted as highly beneficial both economically and financially. In fact, costs went 80 percent over budget for construction, as mentioned above, and 140 percent for financing. Revenues have been half of those forecasted. The internal rate of return on the investment is negative, with a total loss to the British economy of $17.8 billion. Thus the Channel Tunnel detracts from the economy instead of adding to it. This is difficult to believe when you use the service, which is fast, convenient, and competitive with alternative modes of travel. But in fact each passenger is heavily subsidized. Not by the taxpayer this time, but by the many private investors who lost their money when Eurotunnel, the company that built and opened the channel, went insolvent and was financially restructured. This drives home an important point: A megaproject may well be a technological success but a financial failure, and many are. An economic and financial ex post evaluation of the Channel Tunnel, which systematically compared actual with forecasted costs and benefits, concluded that “the British economy would have been better off had the tunnel never been constructed.”

More here.

A Libertarian Look At Neil Gorsuch

February 2, 2017

Amen

February 1, 2017

Trump Strikes Out Defining American Greatness

January 20, 2017

American greatness is defined by one word: liberty.

Generally, liberty is the right to live our lives as we see fit, as long as we don’t violate the rights of others. Government’s job is to protect those inalienable rights (not grant them). Government, through our system of checks and balances, is not supposed to act in an arbitrary manner and do what it wants just because. This is the rule of law.

Liberty means individuals:

-Have the right to speak out.
-Have the right to worship whatever deity they wish, or abstain from worship altogether.
-Are free from arbitrary searches and seizures of their persons or property.
-Are free from punishment without due process.
-Are free to defend themselves.
-Are free to pursue their dreams and (if successful) make a profit from that pursuit.

To paraphrase the 9th Amendment, the list above is not meant to deny or disparage other freedoms.

The United States has struggled to live up to these ideals in the course of its history, but it has done better than any other country to allow liberty to flourish.

Which leads us to Donald Trump’s inauguration.

President Trump said he would use today’s speech to define American greatness. Sadly, the components of liberty were missing from his speech.

Instead, we got the fallacy of protectionism. Some key quotes:

For many decades, we’ve enriched foreign industry at the expense of American industry.

Every decision on trade, on taxes, on immigration, on foreign affairs will be made to benefit American workers and American families. We must protect our borders from the ravages of other countries making our products, stealing our companies and destroying our jobs.

Protection will lead to great prosperity and strength. I will fight for you with every breath in my body and I will never ever let you down.

We will follow two simple rules; buy American and hire American.

This demagogue is clueless. These facts have been stated before on this blog, but they bear repeating again if protectionism is going to be our governing policy for the next 4 years:

-Free trade makes us wealthier. According to Daniel Griswold’s excellent book Mad About Trade (reviewed here), an American family of four is $5000.00 richer because of trade. Internationally, countries with open trade are significantly wealthier, have lower hunger indexes, and even have stronger environmental standards.

-“Buy American” provisions are job losers, depending on the level of export losses we endure due to trade retaliation. From the book Out of Work: Unemployment and Government in Twentieth-Century America, economists Richard Vedder and Lowell Gallaway estimate 20% of the increased unemployment from 1929 to 1932 was a result of the notorious Smoot-Hawley Tariff Act.

-While the job creation aspect is sometimes overstated by free trade proponents, there is a benefit.

-Protectionism that benefits certain industries always comes at the expense of other parties.

There is no morality in forcing one party to essentially pay a ransom to a second party because the second party has special political connections. If a business wants my money, than make a superior product. Provide superior service. Otherwise, you shouldn’t be in business.

If this is what the Republican Party stands for now, it’s a disgrace. I hope they fail.

We need a Milton Friedman now more than ever.

**UPDATE 1/20/17: Here’s a study showing the impact of withdrawing from NAFTA. Not too good for Trump’s vaunted manufacturing sector. Also, Radley Balko ponders the ramifications of Trump’s vow to end the country’s “anti-police atmosphere.” Not too good if value your civil liberties.

Nat Hentoff, RIP

January 14, 2017

In early 2009, I wrote an article for a now-defunct website on the so-called “Fairness Doctrine.” In it, I cited the views of famed columnist Nat Hentoff. A few days after the article was published, I received an e-mail from Mr. Hentoff to call him, because “I admire your reporting.”

To have one of your heroes tell you of their admiration for your work is something, nearly 8 years later, I’m still humbled over.

It took me a couple weeks to muster the courage to make the call. When we spoke, our conversation was brief. I told him of my admiration for his work, he asked where he could find my work, and we both expressed our dismay over the offerings of the 2008 presidential election. The call probably wasn’t more than 3 minutes, and it was the only time we ever spoke.

My blogging is now, just as it was in 2009, a hobby and not a vocation. But this hobby was spurred by a passion to speak truth to power, regardless of political affiliation. There was nobody more formative in influencing me to take up this hobby than Nat Hentoff.

The self-professed “Jewish, atheist, civil libertarian, left-wing pro-lifer” spoke the truth as he saw it, no matter the consequences. No president went unscathed: Reagan was pro-life “up to the moment of birth,” Bill Clinton “dishonored his office,” George W. Bush had a “hole in the soul,” and Barack Obama is “possibly the most dangerous and destructive president we have ever had.” Rest assured, Donald Trump’s pending presidency would not have been spared, either.

When it came to human rights, nobody wrote with more passion and persuasion than Nat Hentoff. His columns on Bush-era torture gave us a righteous anger. Hentoff’s articles about abortion gave blunt clarity to its barbaric features. And nobody was a greater champion for free speech.

Hentoff’s politics almost guaranteed you would never be in complete agreement with him. I find his favorite president to be vastly overrated, for example. But a powerful thinker will make you stop and reconsider your views. Nat Hentoff was most certainly that.

Now more than ever, we need voices that aren’t afraid to be a “pain in the ass” to those in power. Here’s hoping there are other contrarians ready to take the mantle Hentoff leaves behind. RIP.