Remembering The Constitution In The Health Care Debate
I’ve been thinking, lately, about the constitutional basis (or lack thereof) for the health care reform proposals making their way through Congress, trying to understand how people could believe that a massive federal government intrusion into such a significant part of the private sector and of citizens’ private lives could possibly be justifiable. The other day, I came across an article addressing just that, and saying, basically, that there’s no worry about constitutional issues, because of the Commerce Clause, which gives the federal gov’t the power to “regulate” interstate commerce, and the fed’s power to levy taxes. The former gives the gov’t the power to mandate the kinds of health services that must be made available in each state, and who must purchase insurance, because health care activity in one state can create economic effects that cross state lines (hence impacting “interstate commerce”), and the latter provides a second justification for the so-called individual mandate (forcing people to buy insurance) because the penalty for not buying will actually take the form of a tax: if you have approved insurance, you don’t pay the tax, if not, you pay.
On the other side, I read this article, arguing that the federal government has little constitutional justification for most of the spending it does. The article has its flaws, such as the fact that the author says that the first 9 Amendments in the Bill of Rights define the rights/powers of the federal government (more of an oversight, I think, as it is pretty apparent that he meant what the 10th Amendment says: that the federal government cannot assume powers not specifically given to it in the Constitution, itself). But the point is clear… and accurate. The role and powers of the federal government were intentionally limited by the framers of the Constitution, and so twisting its meaning to justify any and all spending and expansion of government authority violates its fundamental principle, and essentially renders the document meaningless.
Look at the justifications in the first article. The Commerce Clause has been used (Wickard v. Filburn, 1942) to tell a farmer in one state how much wheat he could grow for his own personal use (to feed his own chickens), because growing his own wheat would affect a wheat farmer in another state (presumably by reducing demand — his — and hence the price other farmers could command). The extension of this, with respect to health care, is that an individual’s use of health services impacts the broader economy, rippling along across all state lines — the ultimate interstate commerce! Except it’s not. Because, if you accept this premise, then practically every consumer choice we make could fall under the umbrella of interstate commerce. If I decide to drink only tap water, then I’m decreasing the demand for bottled water or water filters, potentially bottled or manufactured in another state. There is no way to argue that people electing to not drink bottled water would not ripple through the entire economy. So, should drinking bottled water be mandated? Of course not. The “economic ripple” argument is ridiculous. And the fact that it’s being used to apply the Commerce Clause to justify a federal takeover of health care demonstrates just how stretched and tortured the Commerce Clause has become. The clause was meant to address issues arising from direct commercial dealings across borders, where problems caused by different currencies, tariffs, and regulations affected the ability to conduct commerce. One effect was that no single state could exercise too much power over another by controlling the rules of commerce. This did not and should not mean that the people within one state should be required to be any more or less productive — or any more or less wasteful. The Commerce Clause gives the federal government power to set the framework for commercial dealings “with foreign Nations, and among the several States, and with the Indian Tribes” – it does not give the government the power to control the behavior of individuals within any of these entities, and such power cannot be assumed. So, while the government may have a role in breaking down regulatory barriers to allow health insurers to operate more effectively (or, in some cases, operate at all) across the several states, it does not have a right to tell the businesses or the citizens how to conduct business within a state.
The individual-mandate-via-tax-penalty argument is ridiculous, as well. It is a circular argument, which says that because the federal gov’t wants to involve itself in something it should not be involved in (mitigating the economic impact of you not having insurance), it therefore has an interest (mitigating the economic impact of you not having insurance) that justifies its involvement (penalizing you through the tax code). In other words, the federal government can tax you into buying health insurance because the government wants you to buy health insurance. That’s nice. Extending that logic a bit, then the government can use the tax code to purposefully push you into living in a smaller house, living in a different location, working in a different profession, having a certain number of children, and so on. Yeah, sure there are those who actually believe these things are good and correct uses of government power. But such influence, without question, goes against the principles of liberty that the Constitution was created to protect.
Article 1, Section 8:
The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
Reading this language in a way that justifies taxation to control behavior goes way beyond practical interpretation of general principles. There is no justification for behavioral penalties (or exemptions, for that matter). The only justification given is to pay for things, not to manipulate the behavior of individual citizens.
Justifying a federal takeover of health care by further twisting and stretching the meaning of the Constitution, with the reasoning being that it’s been stretched before, is outrageous. Courts make mistakes, and although we must abide by the standing rulings, that does not mean that we should not seek to push the government, including the Court, back to the Constitution when they stray too far. The purpose of the Constitution was to help to guarantee freedom from the tyranny of the few over the many. Using the Constitution to justify the continued expansion of federal power, totally misses the point of the document, and spits in the face of the liberty it is meant to protect.
The President Thinks You’re An Idiot
Imagine: It’s 5 AM. You’re tied up and stuck on some railroad tracks, certain to die, if no one comes along to free you before the 4 PM train comes through. From somewhere over on your left, a man claiming to be your hero appears, telling you he can burn the ropes off of you and pull you from the tracks, but he thinks your shoes are stuck, so he says he’ll have to cut off your feet. Oh, and he’s going to blow up the tracks, too — just to be safe. You’re not too excited about his solution. Then, from somewhere to your right another person appears. He tells you there’s no need for fire or hacksaws, he can just untie the rope (and your shoes, if they’re really stuck) and you can walk away. Hero-man on your left shouts at you that his way is better, and that he must do it NOW! The other guy repeats that such drastic measures are not necessary, but hero-man presses on. “Some people say we should do nothing! But doing nothing will be much worse than my plan,” he assures you.
This is what our president is doing. He’s proposing fire and hacksaws and demolition crews to avert the imminent disaster that our health care system will lead us to, and equating anyone advocating a less drastic alternative with someone wanting to do nothing. He did the same exact thing with the stimulus bill, claiming a $750B mess of Democrat pet projects — a bill he did not write and probably did not read — was absolutely necessary to rescue the economy, and had to be passed immediately. Anyone who disagreed was said to prefer to “do nothing,” the implication being that they did not care about suffering Americans. Now, he wants to completely overhaul the US health care system, using new powers and hundreds of pages of new rules and regulations, involving the government deeply in an area in which it is at least questionable (to any reasonable person) for it to be involved. And he wants his plan approved before people have time to really understand it. Those who believe that he is going too far? According to him, they just want to do nothing. This has been his m.o. all along: promote his plans by attacking straw men.
Can this strategy work? Only on idiots. Yet the president uses it, repeatedly. You decide what that means.
‘Health Care Mythology’ Meets Reality
Just read an excellent breakdown of the flawed thinking behind many of the justifications for the radical restructuring of the US health care system being pushed by the Obama Administration. It’s somewhat long (though not a dry read), so I won’t rehash the arguments here. But I did want to highlight something that I think was expressed beautifully, and does a better job of getting across a point I tried to make, in a previous post, about access to health care not being a right:
Listing rights generally involves enumerating things you may do without interference (the right to free speech) or may not be done to you without your permission (illegal search and seizure, loud boy-band music in public spaces). They are protections, not gifts of material goods. Material goods and services must be taken from others, or provided by their labor, so if you believe you have an absolute right to them, and others don’t choose to provide it to you, you then have a “right” to steal from them.
Exactly.
Come On, Krugman, Aren’t You Smarter Than That?
Paul Krugman gets a lot of respect, and perhaps deservedly so. In 2008, he won the Nobel Prize in Economics (a fact used to sell papers, I guess, like “Academy Award Winner” is used to sell movies). So, he’s “influential,” as they say, and, one would guess, intelligent. His Nobel was given for his work regarding international trade — but, apparently, that means he’s an expert on “economics.” However, I happen to think he’s wrong about economic policy, pretty much all of the time. I read his work because, being an influential lefty economist, he lends intellectual heft to the left’s economic policy agenda. But I often find myself shaking my head at many of the things he says as they seem unbelievable, coming from someone who’s supposed to “get” economics. Normally, I just let it go, but I couldn’t, this time.
In an op-ed in the NY Times about how the “Blue Dogs” aren’t making sense, Krugman drops these gems:
This would stop insurers from gaming the system by covering only healthy people.
On the other side, individuals would also be prevented from gaming the system: Americans would be required to buy insurance even if they’re currently healthy, rather than signing up only when they need care.
“Gaming the system?” It’s “gaming the system” to not want to insure people against the chance of illness when they already have it? It’s “gaming the system” to not want to buy something you do not want or need until you decide that you want or may need it? So, is it “gaming the system” to not buy shoes every time you go shopping, and to only buy them when yours are wearing out? Is that “gaming the system?” Spending your money in the way you see fit is somehow cheating? Providing a service in a way that allows you to sustain a business is somehow unethical?
Apply this “thinking” to housing and mortgages. Are lenders “gaming the system” by lending in such a way that they can profit from the money they lend? Should they not be allowed to consider risk? Should everyone, regardless of whether they plan to buy a home this year or in 10 years (or never), be required to take out and start paying for a mortgage now, so that they’ll have it, should they ever need it, or so that lenders will make enough money to overcome losses from risky lending? Or is it “gaming the system” to wait and take out a loan when they need one?
Come on, Mr. Krugman. You’re smart, right? How about applying some of your understanding of scale and consumer behavior toward making the economics of the free market health care system work? Describe some models under which insurers can leverage scale and the power of open competition to continue to make money while expanding access to care. Show consumers how they can pool their resources and use scale, choice, and competition to their advantage. That’s what you should be doing, instead of criticizing people for not wanting to be forced to provide services to support a system that will destroy their incentive to continue to do so, or to hand over money to support a system that will likely wind up limiting their freedom.
Good for the Goose…?
The other day, I saw an article about how President Obama is opposed to the move by congress to restore some of the dealerships cut in the restructuring plans of GM and Chrysler. While I happen to agree with the president, 100%, that the dealers should not be reinstated, it still struck me as funny that the president is essentially telling congress not to do what the president himself has done: intervene in what should be a matter handled by the bankruptcy courts and the parties involved in the business relationships impacted by the bankruptcy. Just as the president stepped in to “save” the automakers, with “saving jobs” as the stated rationale and rewarding political supporters as the practical effect, the various representatives simply want to do the same thing. This is yet another example of why it is stupid to get the government involved in running businesses. Congress has just as much of a legitimate claim — as representatives of the taxpayer owners of these companies — as the administration does for making business decisions (good, bad or terrible).
Meanwhile, I heard President Obama on the radio today, dismissing critics of the ridiculous monstrosity of a health care reform bill working its way through congress as simply trying to “score political points.” Right. Couldn’t be that anyone who doesn’t like the bill might have any legitimate concerns about handing over so much more power and responsibility to the federal government, or about the price tag, or the possible effects on the quality of care. No. They just want to stop these thousand plus pages of complex legislation from flying through congress, before anyone can even truly understand what they say, for political gain. I see. So, when your were on the campaign trail, Mr. President, and you criticized anything your opponent said, or the previous administration did, or when you were a Senator (all those long 3+ years) and you spoke out against or voted to block legislation you did not agree with, was that simply to “score political points?” How absurd. Oh yeah, I forgot — change, right?
Sotomayor Should Be Approved – That’s How It Works
I have no idea how “liberal” or “moderate” or “activist” or “restrained” Judge Sotomayor really is. But it doesn’t really matter. The people of the United States elected a liberal Democrat as president, and gave him a large, sympathetic majority in the US Senate. That means that, barring the discovery of any truly disqualifying behavior (abuse of her position on the bench, illegal activity), the president should get his choice. Every Republican in the Senate should vote to approve the appointment. Their job is “advice and consent” — that’s all. While I’m sure the president didn’t seek much advice from Republicans, and probably disregarded any he received, it is still not the responsibility of the Senate to make the appointment. That is the sole responsibility of the president, whether a Republican or Democrat. The Senate’s role is basically to guard against an outrageous appointment. So, approver her, Republicans, and don’t make a silly show of the hearings. And next election cycle, try making a better case for your point of view about the role of government, the importance of the Constitution, and how the Supreme Court fits into that picture.
This Health Care Bill Must Be Stopped
Look, I admit there are issues with the health care system in the United States. The entire industry could do with some reform to help bring costs down and make access to care easier for more people. But having the government basically take over the entire system is simply not the way to do it. This is true for a number or reasons:
1) The federal government does almost nothing right. Waste, fraud and corruption are almost inevitable in any large government enterprise. It is impossible for a massive federal bureaucracy to be responsive to the needs of individuals. Politics will invariably play a role in the administration of the system, and will most certainly lead to inefficiency and ineffectiveness.
2) It is beyond ridiculous to believe that putting the government, with its propensity to spend money it does not have, in charge of health care will lead to anything but higher overall costs and lower quality. In an effort to control costs, the government will likely impose some form of price controls on services and drugs, and some form of rationing. These things will be necessary, because otherwise doctors will charge as much as they want, and people will take much more than they need. Clamping down on such overindulgence will involve some amount of arbitrary decision making (and some based on politics and lobbying), meaning doctors will have an incentive to seek out procedures that maximize what they can earn, and people will not necessarily get the care appropriate for their needs. Price controls will also provide an incentive for health service providers to try to make up in volume what they lose in margin.
3) Most importantly, it is an absolutely improper role for the federal government, and is a threat to the very idea of liberty upon which this country was built. The federal government will wind up with an unbelievable amount of control over the health of every individual. Even granting that it is not the intention of the plan’s backers to wield such influence in any harmful way, the power will nonetheless have been given to the government, with its passage. Think about it, the current private health insurers already (rightly) try to influence how we live, by providing incentives for healthier living (no smoking, exercise, preventative care, etc). They do so in their own self-interest, which generally happens to mesh with the interest of better health. They also each have their own rules for what is covered, which drugs patients have access to, which doctors patients can see. But at least right now, if you don’t like what your insurance company offers, there is at least a possibility for you to go elsewhere. There is competition (though it is distorted, and could use some opening up). But with only one massive insurer in the picture, and that is what a federal system would almost certainly become, there would be no alternatives for anyone. They could tell you what kind of care you could get, and that would be that. They could tell you how to live, using the threat of withholding care or higher taxation, and you would have no possible recourse. They could — and would — tell drug companies which drugs to develop, based on their idea (subject to lobbying and political pressure) of what is most needed, as opposed to the free market’s.
The federal government of the United States was created with one idea in mind: maximizing the liberty of all US citizens. To achieve that goal, the founders placed limits on the role of the central government, with the purpose of keeping power as close to the people as possible. The federal government exists essentially to facilitate cooperation between the states, allowing for the pooling of resources, where necessary, such as in the area of defense, and in most areas providing rules under which the states must operate, when dealing with one another. Its other essential responsibility is to insure that none of the individual rights, enumerated in the Bill of Rights and subsequent amendments, are denied to any citizen. Access to health care is only a right insofar as no government should have the power to deny such access to any citizen. This does not mean the government must or should provide that care, just like it is not the business of the government to provide you with a religion, just because it guarantees your freedom to access the religion of your choice. Nor should the government provide you with a gun, even though it is supposed to protect your right to have access to one. It would be foolish beyond imagination to grant so much more power to a government so unresponsive to the people whose freedom it is supposed to protect. This bill must be stopped.
Everyone Wants To Keep Their Cake
If you didn’t know, we’re in some pretty tough economic times. Oh, you’ve heard? Because, obviously, many people have not… or at least that’s the conclusion you could draw, if you’ve been following some of the big developments, lately. Exhibit A: The auto follies. The headlines this week tell of how GM and Chrysler will now have to defend their decisions on dealership closings before the senate.
Because the federal government is slated to own most of General Motors and 8 percent of Chrysler, some of the senators said they have a responsibility, as major shareholders do, to review company decisions.
Oh, sure. And “as major shareholders do,” I’m sure you’ll be considering what’s best for the company, rather than what’s going to help you look good for voters in your state. Hey folks, welcome to reality! GM and Chrysler are bankrupt. They are restructuring, under the direction of the courts and the federal government. They were told to trim their product lines, eliminate brands, and ratchet down their operations, in order to achieve something like sustainability. This has to happen. If it doesn’t, GM and Chrysler die. And then ALL of their dealers will be out of luck.
“Let me be very clear — I don’t believe that companies should be allowed to take taxpayer funds for a bailout and then leave local dealers and their customers to fend for themselves with no real notice and no real help. It’s just plain wrong,” [Sen. Rockefeller] said.
Just plain wrong? The whole idea here is to try to save an American industry so that it can again become a job creator, and so that it can again support the businesses built up around it (parts suppliers, tool makers, dealerships, etc). Is there to be no pain? Should we be bailing out the auto dealerships, too? Yeah, let’s send ‘em all a check for the money they would have made had GM and Chrysler not gone belly-up. The Fed can print more money. Who cares?
Exhibit B: The (Once) Golden State. California is on the brink of bankruptcy. Years of free spending in fat times have finally caught up to the state, and now, if it is to have any hope of avoiding a financial collapse, meaningful cuts have got to be made. But, surprise surprise, no one wants to be on the receiving end of those cuts. The California state government worked out a plan that would have involved trimming the state contribution to home healthcare workers’ wages, and the SEIU (which represents those workers) rebelled, taking the case to Washington. The Obama administration decided to use the stimulus money slated for California as a stick (another big surprise) to bully the state into undoing the wage cutbacks. So, instead of a $2 per hour cut, the SEIU would prefer to have the state go bankrupt. Another example comes with California’s decision to close ~220 state parks — people are rallying against it. Sure, there’s a potentially legitimate argument to be made that shutting down the parks will impact economic activity to such an extent that the move defeats its own purpose. But there are still plenty of reasons for tourists to visit the state — and something has to be cut. If California cannot close it’s budget gap, destroys its credit rating, and cannot secure the funds it need to keep operating, more than just the state parks will be closing.
I hate to resort to generational generalizations, but it’s hard not to see that Americans have become incredibly spoiled. We can’t all have everything we want, all the time. We can’t always expect things to be the same as they are during the best of economic times. The government can’t artificially support the fat living that we’ve grown accustomed to, when times are lean. The economy and the financial system have to go through a necessary process to right themselves. The process can be painful, but if it doesn’t happen, nothing gets fixed. We simply cannot have our cake and eat it, too.
Because the federal government is slated to own most of General Motors and 8 percent of Chrysler, some of the senators said they have a responsibility, as major shareholders do, to review company decisions.
A Lesson In The Problem Of ‘Big Government’
<sound of cobwebs being cleared…>
Got back from a 2-week semi-vacation (I worked, most of it) about 2 weeks ago. I had meant to post something sooner, but I couldn’t find much motivation. But just now I came across an article in Forbes describing what is being done wrong, with respect to the Chrysler bankruptcy. After reading it, I realized that what’s happening in this case actually illustrates a point about government expansion that I had tried to make in a pre-election post. Essentially, that point was that handing over more of the private economy to the government is a bad idea, because government agencies do not respond to the realities of the market, and are therefore destined to be inefficient and to exacerbate the problems they’re supposed to be addressing. Or, more generally, giving more power to the government will inevitably lead to abuse of that power, as well as waste. The Chrysler saga seems to demonstrate this pretty well.
As we all know, the federal government got involved in the “rescue” of GM and Chrysler, by loaning them billions of dollars, intended to give them a chance to fix themselves. At the time, there were some voices saying that the companies should be allowed to go into bankruptcy, if they were not able to fix themselves without government help. But, mostly, what we heard were things like, “Bankruptcy is not an option!” and “They’re too big to fail!” President Obama promised to “save” the US auto industry (yes, I know the Bush administration started the ball rolling), while also saying he had no interest in running the car companies.
And where are we now? The president has demanded that Chrysler and GM submit to his administration plans to achieve viability — and has rejected parts of the plans, demanding revisions (so much for “no interest” in running the companies). In the case of Chrysler, after dumping billions more in taxpayers’ money into the company (read: waste), he has forced it into bankruptcy (not an option?) and into a deal that will divide ownership of the company among Fiat, the US and Canadian governments, and the UAW — with the union getting the majority stake in the company. In the process, the administration is strong-arming Chrysler’s creditors into taking a much less equitable deal than they would expect under the law, in a normal bankruptcy (read: abusing power). He has allegedly used the TARP money awarded to many of those creditors as leverage to get them to agree to the deal. (Funny thing here, he’s actually forcing TARP-receiving creditors to further hurt their own balance sheets by giving up money to which they are legally entitled.)
Why are things being done this way, when Chrysler declaring bankruptcy months ago would have saved billions in taxpayer money, and left legal decisions in the hands of the courts, where they belong? Well, the two reasons I can come up with are foolishness: the president believes he knows better than the bankruptcy courts and people with relevant industry experience; and politics: the president gets to claim that he’s “doing something,” he gets to tilt the deal to favor a major constituent group (unions), and he gets to gain more leverage over private industry, and therefore more political power. This is exactly the problem with expanding the role of government further into the private sector. The motivations and accountability are very different, and most often are not focused on or responsive to the true needs of the market, a.k.a., the people. Instead of getting the most efficient solution to the problem at hand, we get grandstanding, power-grabbing, and billions more dollars wasted.
Now, let’s get the government into the health care business….
… But He Doesn’t Like Big Government
“Let me be clear: the United States government has no interest or intention of running GM. What we are interested in is giving GM an opportunity to finally make those much-needed changes that will let them emerge from this crisis a stronger and more competitive company.”
These words are from President Obama’s address about his plans for the auto industry. We don’t want to run the auto companies… aside from maybe making some staffing decisions, exercising veto power over restructuring plans, providing “guidance” in developing such plans, and being directly involved in negotiations with potential partners. That’s all. Oh, and we’ll back the warranties. But that’s it. Oh yeah, and we’ll fund operations for a while.
This tendency of Obama’s to do one thing and then say the total opposite brings to mind an old Eddie Murphy bit, in which a woman catches her man coming out of another woman’s house, confronts him about it, and he just says, “Wasn’t me.” She keeps after him, but he just keeps saying, “Wasn’t me,” until she comes around: “Well, maybe it wasn’t you.”
But more than the sheer audacity of his double-speak, the real problem is with what Obama’s administration is actually trying to do here. They are doing nothing short of attempting to take over for the free market and the existing legal system. The US auto companies are “too big to fail,” so, we can’t let them go bankrupt, so, we’ll loan them money to give them a chance to fix themselves. But then we’re going to treat them pretty much the same as if they had declared bankruptcy – force everyone involved to renegotiate contracts, force them to come up with a recovery plan that meets an outside party’s criteria, involving selling off parts of the companies, and consolidating (eliminating) brands — but with the administration running the show, instead of a court. In the case of Chrysler, at least, the government will even mandate what kinds of cars the company can produce!
What the hell is going on, here!?
This country was conceived around the idea of freedom. Freedom meant that no authority could tell you how to live, force you to follow a particular religion, keep you from seeking to rise up from the “class” into which you were born. There were to be no noble lords, here. Anyone, through hard work, dedication, and luck, would be free to succeed. That freedom includes — necessarily! — the freedom to fail. Our history is littered with failures, big and small. But it is also littered with successes, most of which have come out of the failures. And, on balance, the successes have vastly outweighed the failures — which is why ours has been the most successful country in human history.
Does the President of the United States not know this? Can he really believe that bankruptcy at GM and/or Chrysler would mean the “disappearance” of the auto industry from the US? That entrepreneurs would not find opportunities in the ashes of the old, burnt out, auto companies? Does he really believe that government agencies and politicians can force businesses to be successful? (It is pretty obvious that he does.) Just think about the audacity involved here. What his actions are saying is that he, with the experience of his 47 years of life, never running any business, can manage not one company to success, but entire industries! He knows better. He knows who can do the best job. He can identify the best course. It is absolutely insane!
I’ve said this before: Either you believe in free-market capitalism, or you do not. So, when the president says he doesn’t “like big government, ” and when he says he doesn’t want government running the auto companies, and when he says that he’s not interested in nationalizing the banks, but then he turns around and explodes the size of government, and tells the auto companies and banks how they’re going to run their business, the truth is pretty obvious. It doesn’t matter what he says about these measures being temporary – he simply does not trust free-market capitalism. Period. And that means that he doesn’t really trust freedom, because the two are inextricably intertwined.
When Obama was elected, I was more worried about congress running right over him, with spending on all kinds of big-government projects, than I was about him. Though he had promised everything to everyone, in his nomination acceptance speech, I still thought that maybe he really could be something different — that maybe he would try to exercise some restraint in his application of government power. But in just a couple of months, he has shattered any illusions I had about him. He is a man who absolutely believes that the government — better than the mass of the free people, better than the free market — can solve all of our problems. He truly believes in a very different America than the one in which I believe.
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