Obamacare

Prescience about Obamacare

The estimable Charles Krauthammer writes about Obamacare:

Obamacare was sold as simply a refinement of the current system, retaining competition among independent insurers but making things more efficient, fair and generous. Free contraceptives for Sandra Fluke. Free mammograms and checkups for you and me. Free (or subsidized) insurance for some 30 million uninsured. And, mirabile dictu, not costing the government a dime….

That was a fraud from the very beginning. The law was designed to throw people off their private plans and into government-run exchanges where they would be made to overpay — forced to purchase government-mandated services they don’t need — as a way to subsidize others. (That’s how you get to the ostensible free lunch.) …

Three years ago I predicted that Obamacare would turn insurers into the lapdog equivalent of utility companies. I undershot. They are being treated as wholly owned subsidiaries. Take the phrase “strongly encouraging.” Sweet persuasion? In reality, these are offers insurers can’t refuse. Disappoint your federal master and he has the power to kick you off the federal exchanges, where the health insurance business of the future is supposed to be conducted.

Moreover, if adverse selection drives insurers into a financial death spiral — too few healthy young people to offset more costly, sicker, older folks — their only recourse will be a government bailout. Do they really want to get on the wrong side of the White House, their only lifeline when facing insolvency?

Obamacare posed as a free-market alternative to a British-style single-payer system. Then, during congressional debate, the White House ostentatiously rejected the so-called “public option.” But that’s irrelevant. The whole damn thing is the public option. The federal government now runs the insurance market, dictating deadlines, procedures, rates, risk assessments and coverage requirements. It’s gotten so cocky it’s now telling insurers to cover the claims that, by law, they are not required to.

Welcome 2014, our first taste of nationalized health care.

I must say, in all modesty, that I (and others) predicted the shape of the future more than four years ago,  well before Obamacare became “the law of the land.” See, for example, my posts dated July 27, September 12, October 9, and October 18, 2009:

Rationing and Health Care
The Perils of Nannyism: The Case of Obamacare
More about the Perils of Obamacare
Health-Care Reform: The Short of It

Other related posts:
The Unconstitutionality of the Individual Mandate
Does the Power to Tax Give Congress Unlimited Power?
Does Congress Have the Power to Regulate Inactivity?
Obamacare: Neither Necessary nor Proper
Obamacare, Slopes, Ratchets, and the Death-Spiral of Liberty
Another Thought or Two about the Obamacare Decision
Obamacare and Zones of Liberty
“Social Insurance” Isn’t Insurance — Nor Is Obamacare

“Social Insurance” Isn’t Insurance — Nor Is Obamacare

Social Security, Medicare, and Medicaid (as revised and expanded by Obamacare) are by far the costliest forms of “social insurance” in the United States. According to estimates prepared by the Congressional Budget Office, those programs (including ancillary activities, such as insurance subsidies) will cost $3.3 trillion in 2023. However, the feds will collect only $1.6 trillion in “social insurance” taxes in 2023. That’s a $1 trillion increase in the “social insurance” deficit from its level in 2013. (Derived from Summary Table 1, Table 1-1, and Table 1-3 of “The Budget and Fiscal Outlook: Fiscal Years 2013 to 2023,” February 2013.)

I put quotation marks around “social insurance” because it isn’t insurance, for the reasons discussed in this post. What is it? Just another set of programs designed to redistribute income, mainly from those who’ve earned it to those who haven’t. “Social insurance” is a trickle-down transfer-payment scheme, wherein some of the money reaches its intended targets after passing through the sticky fingers of the overpaid bureaucrats who live in and around Washington, D.C.

What’s the difference between “social insurance” and real insurance? Insurance — to be insurance and not merely a subsidy — must have the following characteristics:

  • It must apply to defined, undesirable events that might befall any person or business in the insured group.
  • The group will be defined by specific characteristics (e.g., age range, gender, medical history, location relative to a known hazard such as forest fires).
  • The probability of occurrence (frequency) of a particular event can be estimated with some accuracy, for the group as a whole.
  • There is no way to predict the timing or frequency with which the event will befall a particular member of the group.
  • In exchange for a specified premium, an insurer agrees to pay each member of the group a specified amount should an insured event befall that member during a specified time period.
  • The insurer will periodically revise his estimate of the probability of the occurrence of various events and the costs of insuring against those those events, and may accordingly change the terms on which he offers insurance (e.g., covered events, premium, amount to be reimbursed, conditions for insurance eligibility).
  • Insurance should be self-sustaining. The insurer, taking into account risk and uncertainty, will strive for a situation where, in most years, premiums cover payouts plus administrative expenses and enough profit to keep the insurer from moving his capital to other, more-rewarding ventures.
  • But insurance cannot be sustained by force — through taxes levied on taxpayers at large to provide benefits to certain classes of persons, for example. Any such program fails to meet the criteria listed above, and is nothing more than a subsidy.

“Social insurance” isn’t insurance because it fails on all counts.

Consider Social Security. Retirement is not an undesirable event that might occur; it is a desirable event toward which almost everyone strives. Social Security is merely a government-imposed substitute for the prudent act of saving toward one’s retirement and then drawing on the accumulated nest-egg to finance that retirement. The usual excuse for Social Security is that a lot of people, especially low-income persons, can’t or won’t save enough to maintain some (arbitrary) standard of living during retirement. In other words, Social Security isn’t insurance against an unpredictable event, it’s a mechanism for subsidizing low-income and imprudent persons at the expense of their opposites.

The same analysis applies to Medicare, Medicaid, and other forms of federal and State “social insurance.” The risk pools are huge and ill-defined. The premiums are either nominal (Medicare) or non-existent (Medicaid and other programs). All such programs are nothing more than non-contractual “promises” to pay certain amounts for certain events, regardless of the probability of those events and their associated costs.

Even programs that mimic insurance — unemployment benefits and workers’ compensation, for example — are really subsidies because of their all-encompassing nature and the forcible extraction of “premiums” from employers. Those who are at risk for unemployment and on-the-job injuries have no say in the matter of how much insurance they wish to purchase and how much they are willing to pay for it. Unemployment “insurance” is an especially weird kind of “insurance,” in that the benefits expand and contract according to the whims of government actors.

Enough said about “social insurance” as insurance. It simply isn’t insurance. And thanks largely to Obamacare, health insurance is going the way of “social insurance.”

Health insurance, despite heavy regulation and the distortions produced by tax breaks, has until recently retained the characteristics of true insurance. Now comes Obamacare, the point of which is to move toward universal, government-controlled health care under the guise of “insuring” a larger fraction of Americans. What Obamacare really does, of course, is to force Americans, as consumers and taxpayers, to buy and subsidize “insurance” that covers events that aren’t health risks; for example: so-called preventive care, the use of contraceptives, abortion, various kinds of maternity and pediatric care, and the coverage of “children” up to the age of 26.

What about mandatory coverage of pre-existing conditions? Here’s Greg Mankiw on the subject:

A large part of the motivation of the Affordable Care Act is to provide insurance to those with pre-existing conditions. Under the law, insurance is offered to everyone at a price based on overall community risk, not the risk estimated by the insurance company based on a person’s particular characteristics. That has been deemed “fair” by advocates of the law.

I wonder whether advocates of this view are concerned with other insurance markets.  Teenage drivers pay a lot more for auto insurance. The old pay a lot more for life insurance.  Life insurance companies require health screening before granting a policy. Is this a problem, or the natural and desirable functioning of markets?

The answer to Mankiw’s question is that advocates of Obamacare aren’t really trying to insure anyone, they’re trying (successfully) to ram socialized medicine down the throats of Americans. Obamacare is a step in exactly the wrong direction. It’s an effort to emulate the long-discredited nationalized health-care systems of Canada and Britain (small sample here), complete with death panels. And sure enough, they’re already here, in Oregon.

I was prompted to write this post because I happened on a piece by Scott Gallipo, writing at The American [Pseudo-] Conservative. In a patent attempt to defend Obamacare, Gallipo begs real conservatives to “Stop Comparing Health Insurance to Car Insurance.” Gallipo’s “argument” is fatally confused; for example:

It’s helpful to step back and remind ourselves why we ask doctors to perform “preventative maintenance” on our bodies. If diseases are caught early, they’re often cheaper to treat or cure. If we stay in good physical shape, we reduce the chances of developing many diseases in the first place. When we preventatively maintain our cars, however, we are merely forestalling problems that we would have to pay out-of-pocket for anyway. If you don’t change your oil, your car insurance plan isn’t going to cover the cost of fixing a seized engine.

Gallipo is trying to distinguish preventive health care from preventive auto care, but he fails to do so. For one thing, he wrongly asserts that preventive maintenance forestalls problems that would have to be paid for out-of-pocket. Not necessarily. That’s why warranties (insurance) and their cost (premiums in disguise) are baked into the price of new autos. And that’s why many auto buyers obtain extended warranties. As it happens, I obtained my extended warranty from GEICO. It’s additional coverage under my auto policy, and it commands an additional premium And what does GEICO call my extended warranty? Mechanical breakdown coverage (i.e., insurance).

More fundamentally, Gallipo makes some heroic assumptions about preventive care. Yes, routine tests will sometimes result in the detection and treatment of conditions that would otherwise be detected at a later stage. But the cost of checkups and lab tests, when ordered wholesale by doctors because they’re “free,” far exceeds the benefits. (See this, this, this, and this, for example.)

Most fundamentally, Gallipo begs the question. In his (incorrect) view, preventive “care” on a massive scale is a “good thing.” Therefore, it should be covered by insurance. But the massive overuse of “free” checkups and lab tests has nothing to do with insurance, and everything to do with the nationalization of health care. Those “free” checkups and tests will not be paid for by risk-related premiums; they will be paid for by taxpayers and the millions of Americans whose Obamacare “premiums” are really “contributions” to an open-ended national health-care plan.

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Related posts:
Rationing and Health Care
The Perils of Nannyism: The Case of Obamacare
More about the Perils of Obamacare
Health-Care Reform: The Short of It
Toward a Risk-Free Economy
Enough of “Social Welfare”
Points of Agreement and Reinforcement
Death Panels
Government Failure Comes as a Shock to Liberals
The View from Here
Another Obama Lie, and a Rant

Another Obama Lie, and a Rant

From a CBS News story about the latest Obamacare fiasco:

President Obama on Thursday announced an administrative policy change that will let people keep their existing health insurance for another year, but the plan is already facing pushback from Republicans, some Democrats and the insurance industry….

…Mr. Obama predicted Thursday, “There’s gonna be some state-by-state evaluation on how this is handled.”

He added, however, that the “key point” is that it’s no longer the Affordable Care Act that’s responsible for plans being dropped….

What a whopper. Of course the ACA is responsible. Insurance companies were diligently complying with the ACA. And that didn’t happen overnight; they began to gear up for compliance as soon as ACA became law.

Now, one of Obama’s minions issues — by unconstitutional fiat — a “fix” that can’t easily be implemented, even if allowed by the insurance commissioners of some States. It’s a blatant and cynical PR move.

Here’s the rant — mine, not Obama’s (he can rant on his own time):

Left-wing amateur hour has dragged on 4-10/12 years too long. As the bumper sticker says, don’t blame me, I didn’t vote for him.

Did I foresee this particular fiasco? Of course not, but I foresaw that Obama would try to use government in ways that would harm most hard-working, tax-paying, law-abiding Americans. Well, thanks to Obamacare, tax increases, racial politics, and various regulatory edicts he’s met my expectations. He’s also doing a good job of turning the U.S. into a second-rate power, unable to defend Americans’ far-flung overseas interests against the Russian and Chinese power grabs that are almost certainly in the works.

Even if Obama had succeeded in “bringing the country together” (or something to that effect), it would be a country that millions of us want no part of. On Thursday, November 28, if I give thanks for anything, it will be for a divided nation in which there is still principled and vigorous resistance to the likes of Barack Obama.
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Related posts: Just about everything here.

The View from Here

You know what happens when a law is enacted to protect a “minority,” don’t you? The minority acquires privileged status in the eyes of the law. Any action that is claimed to deprive the “minority” of its rights brings the wrath of the state down on the purported offender. And the same law enables members of the “minority” to attain jobs, promotions, and university admissions for which they are otherwise unqualified.

My opening paragraph is prompted by the likely passage of a “gay rights in workplace” bill by the U.S. Senate. The bill is unlikely to be approved soon by the U.S. House of Representatives, but I won’t say “never.” Many members of the GOP are eager to seem “nice,” and enough of them might vote with Democrats to pass the bill and send it to B.O. for signature. Such an act of appeasement will, of course, go unrewarded by voters of the left. But panicked lawmakers are immune to logic, and devoid of principles.

The “gay rights” issue is only a symptom of America’s decay. The official elevation of gays to privileged status is of a piece with several other developments: the very possible failure of efforts to derail death-dealing Obamacare, the equally likely failure of efforts to curb murderous abortion (the gateway to involuntary euthanasia), the ever-growing dependence of Americans on an unaffordable welfare state, an unchecked regulatory apparatus, feminized and gutted defenses, groveling before enemies, and the suppression of dissent in the name of “rights,” “social justice,” “equal protection,” and other Orwellian catch-phrases.

It is altogether evident that America soon will be an irreversibly effete, statist, inhumane, and appeasing realm. In it, every truly beneficial impulse — like those that energized America’s revolution against Britain, the framing of a Constitution that promised the preservation of liberty, the defeat of oppressive regimes in wars hot and cold, and the creation of the world’s most dynamic and productive economy — will be squelched.

The barbarians within, and their willing dupes, are in the saddle. It can happen here, and it is happening here. America is about to become the land of the unfree and the home of the weak-kneed.

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Related reading: Joe Herring, “I Am Now a Dissident (and You Should Be Too!),” American Thinker, November 6, 2013

Related posts:
Diversity
Putting Hate Crimes in Perspective
The Cost of Affirmative Action
Why Not Just Use SAT Scores?
The Face of America
Affirmative Action: A Modest Proposal
Race, Intelligence, and Affirmative Action
Affirmative Action: Two Views from the Academy
Affirmative Action, One More Time
Libertarianism, Marriage, and the True Meaning of Family Values
Same-Sex Marriage
“Equal Protection” and Homosexual Marriage
The Course of the Mainstream
A Contrarian View of Segregation
Much Food for Thought
Guilty Until Proven Innocent
After the Bell Curve
A Footnote . . .
Schelling and Segregation
Law, Liberty, and Abortion
Black Terrorists and “White Flight”
Positive Rights and Cosmic Justice: Part IV (with links to earlier parts of the series)
Timely Material
Affirmative Action: Two Views from the Academy, Revisited
It’s the Little Things That Count
A Footnote to a Footnote
Let Me Be Perfectly Clear…
FDR and Fascism
An FDR Reader
“Family Values,” Liberty, and the State
Is There Such a Thing as Society
The People’s Romance
Intellectuals and Capitalism
Fascism
Conspicuous Consumption and Race
An Honest Woman Speaks Out
Fascism with a “Friendly” Face
The Interest-Group Paradox
Parsing Political Philosophy
Is Statism Inevitable?
Inventing “Liberalism”
Civil Society and Homosexual “Marriage”
A New, New Constitution
Fascism and the Future of America
The Indivisibility of Economic and Social Liberty
Rights, Liberty, the Golden Rule, and the Legitimate State
The Perils of Nannyism: The Case of Obamacare
More about the Perils of Obamacare
Health-Care Reform: The Short of It
The Real Constitution and Civil Disobedience
The Near-Victory of Communism
Tocqueville’s Prescience
First Principles
The Shape of Things to Come
Accountants of the Soul
Invoking Hitler
Is Liberty Possible?
The Left
Perry v. Schwarzenegger, Due Process, and Equal Protection
The Constitution: Original Meaning, Corruption, and Restoration
Rationalism, Social Norms, and Same-Sex “Marriage”
A Moral Dilemma
A Conversation with Uncle Sam
Society and the State
I Want My Country Back
The “Forthcoming Financial Collapse”
Undermining the Free Society
Our Enemy, the State
Pseudo-Libertarian Sophistry vs. True Libertarianism
“Intellectuals and Society”: A Review
Government vs. Community
The Evil That Is Done with Good Intentions
The Destruction of Society in the Name of “Society”
About Democracy
Externalities and Statism
Taxes: Theft or Duty?
Bounded Liberty: A Thought Experiment
More Pseudo-Libertarianism
The Meaning of Liberty
The Left’s Agenda
Substantive Due Process and the Limits of Privacy
In Defense of Marriage
The Left and Its Delusions
The Destruction of Society in the Name of “Society”
A Declaration of Civil Disobedience
Crimes against Humanity
Abortion and Logic
The Myth That Same-Sex “Marriage” Causes No Harm
The Spoiled Children of Capitalism
Politics, Sophistry, and the Academy
Subsidizing the Enemies of Liberty
Society and the State
Are You in the Bubble?
Defense as an Investment in Liberty and Prosperity
Our Perfect, Perfect Constitution
Abortion, Doublethink, and Left-Wing Blather
Race and Reason: The Derbyshire Debacle
Race and Reason: The Victims of Affirmative Action
Not-So-Random Thoughts (III)
Race and Reason: The Achievement Gap — Causes and Implications
Don’t Use the “S” Word When the “F” Word Will Do
Liberty and Society
Tolerance on the Left
The Eclipse of “Old America”
The Capitalist Paradox Meets the Interest-Group Paradox
Genetic Kinship and Society
How Not to Cope with Government Failure
Riots, Culture, and the Final Showdown (revisited)
Where We Are, Economically
The Economic Outlook in Brief
Is Taxation Slavery?
Obamanomics: A Report Card
Well-Founded Pessimism
A Declaration of Independence
The 80-20 Rule, Illustrated
America: Past, Present, and Future
Defending Liberty against (Pseudo) Libertarians
America: Past, Present, and Future
Restoring Constitutional Government: The Way Ahead
Economic Horror Stories: The Great “Demancipation” and Economic Stagnation
The Fallacy of the Reverse-Mussolini Fallacy
“Conversing” about Race
Economics: A Survey
IQ, Political Correctness, and America’s Present Condition
The Barbarians Within and the State of the Union
Why Are Interest Rates So Low?
Estimating the Rahn Curve: Or, How Government Spending Inhibits Economic Growth
America’s Financial Crisis Is Now
The World Turned Upside Down
“We the People” and Big Government: Part I
“We the People” and Big Government: Part I (continued)
“We the People” and Big Government: Part II (first installment)

Government Failure Comes as a Shock to Liberals

Richard Cohen of WaPo shares his disappointment in the god the failed:

Where is Casey Stengel when we need him? In 1962, as the manager of the brand new and determinedly hapless New York Mets — 40 wins, 120 losses — he looked up and down his bench one dismal day and wondered, “Can’t anybody here play this game?” That phrase kept coming at me recently as I watched the impressively inept performance of the Obama administration in both foreign and domestic policy. On a given day, this administration makes the ’62 Mets look good….

[Obama] has lately so mishandled both domestic and foreign policy that he is in mortal peril of altering his image. This unsettling and uncharacteristic incompetence became shockingly clear when Obama failed to come to grips with the Syrian civil war….

The debacle of the Affordable Care Act’s Web site raised similar questions about confidence….

Something went wrong. People could not sign up. Why? Not sure. Who’s at fault? Apparently no one. An act of God….

Poor Richard. He doesn’t get it. The problem isn’t just Barack Obama, it’s government. What Cohen is witnessing is government failure. It’s pervasive and inevitable — though its ill effects often go unremarked. (For example, the significant reduction of economic growth that has resulted from the growth of government spending and regulation.)

When government failure assumes spectacular proportions and can’t be ignored or explained away, it gets attention because it explodes the Nirvana fallacy about government that infects so many politicos, mediacrats, and real people (but not Americans on the whole).

What’s most striking about Cohen’s piece and similar outpourings from the media is that the target is a Democrat. I would say that a new dawn of realism is breaking, but that would be to indulge in the Nirvana fallacy.

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Related posts:
Undermining the Free Society
Government vs. Community
Government Failure: An Example
Bootleggers, Baptists, and Pornography
The Public-School Swindle
The Evil That Is Done with Good Intentions
Externalities and Statism
Society and the State
David Brooks, Useful Idiot for the Left
Don’t Use the “S” Word When the “F” Word Will Do
How Not to Cope with Government Failure
Well-Founded Pessimism
America: Past, Present, and Future
IQ, Political Correctness, and America’s Present Condition
The Barbarians Within and the State of the Union
Why Are Interest Rates So Low?
Vulgar Keynesianism and Capitalism
Estimating the Rahn Curve: Or, How Government Spending Inhibits Economic Growth
America’s Financial Crisis Is Now
The World Turned Upside Down
“We the People” and Big Government: Part I
“We the People” and Big Government: Part I (continued)
“We the People” and Big Government: Part 2 (first installment)

Not-So-Random Thoughts (VIII)

I begin with a post of mine, “Civil Society and Homosexual ‘Marriage’“:

[A]s sure as the sun sets in the west, the state will begin to apply the equal protection clause of the Fourteenth Amendment in order to protect homosexual “marriage” from its critics. Acting under the rubric of “civil rights” — and  in keeping with the way that anti-discrimination laws have been applied to date — the state will deal harshly with employers, landlords, and clergy who seem to discriminate against homosexual “marriage” and its participants.

And right on schedule:

[T]he New Mexico Supreme Court has found that a photographer who declined to photograph a gay “wedding” was at fault… (Tom Trinko, “New Mexico Takes a Stab at Nullifying the Constitution,” American Thinker, August 25, 2013)

See also my post “Abortion, ‘Gay Rights,” and Liberty.

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Keir Maitland nails the pseudo-libertarian mentality:

Libertarians are being torn apart from within. Two groups are responsible for this: the libertines and the liberal bigots. ‘Liberal bigots’ is a phrase that I have stolen from Peter Hitchens and I am using it to describe a group within the libertarian movement who are more concerned about being politically correct than defending anybody’s right to discriminate. By libertines, I mean simply those who view libertarianism as a rebellion against tradition, hierarchy, morality and authority….

The former, the liberal bigots, in my view are often ‘thin libertarians’ of the worst kind: libertarians who believe in the nonaggression axiom and nothing else. These people can only think in terms of libertarian legal theory and, as cultural Marxists, will defend anybody’s way of life, except, oddly enough, a traditionalist and antiegalitarian way of life. The latter, however, are usually ‘thick libertarians’…. Thick libertarians are libertarians who, in addition to being well-versed in libertarian law, think about how a libertarian society would, could and should function. Thick libertarians judge not only whether or not something is legal, but whether it is conducive to libertarian ends. However, sadly, the modal thick libertarian is a libertine: someone who believes that prosperity, happiness and other good ends, for which we all strive, are achieved not through a ‘sensible’ lifestyle but through a relatively reckless one. (“Libertines and Liberal Bigots,” Libertarian Alliance Blog, August 22, 2013)

Maitland’s assessment harmonizes with my own, which I’ve expressed in several posts, including “Defending Liberty against (Pseudo) Libertarians“:

(Pseudo) libertarians like to demonstrate their bogus commitment to liberty by proclaiming loudly their support for unfettered immigration, unfettered speech, unfettered abortion, unfettered same-sex coupling (and legal recognition thereof as “marriage’), and unfettered you-name-it.. In the minds of these moral relativists, liberty is a dream world where anything goes — anything of which they approve, that is….

Another staple of (pseudo) libertarian thought is a slavish devotion to privacy — when that devotion supports a (pseudo) libertarian position. Economists like Caplan and Boudreaux are cagy about abortion. But other (pseudo) libertarians are less so; for example:

I got into a long conversation yesterday with a [Ron] Paul supporter who took me to task for my criticisms of Paul’s positions. For one thing, he insisted, Paul’s position on abortion wasn’t as bad as I made it out, because Paul just thinks abortion is a matter for the states. I pointed out that in my book, saying that states can violate the rights of women [emphasis added] is no more libertarian than saying that the federal government can violate the rights of women.

Whence the “right” to abort an unborn child? Here, according to the same writer:

I do believe that abortion is a liberty protected by the Fourteenth Amendment….

This train of “logic” is in accord with the U.S. Supreme Court’s manufactured “right” to an abortion under the Fourteenth (or was it the Ninth?) Amendment, which I have discussed in various places, including here. All in the name of “privacy.”…

It is no wonder that many (pseudo) libertarians like to call themselves liberaltarians. It is hard to distinguish (pseudo) libertarians from “liberals,” given their shared penchant for decrying and destroying freedom of association and evolved social norms. It is these which underlie the conditions of mutual respect, mutual trust, and forbearance that enable human beings to coexist peacefully and cooperatively. That is to say, in liberty.

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A recent foray into constitutional issues unearthed this commentary about the opinion delivered by Chief Justice Roberts in the case of Obamacare:

Oh, how far we’ve deviated from our Founders in just over 200 years.

The entire country is pouring over an incoherent, internally contradictory, ill-conceived and politically motivated decision by Chief Justice Roberts, which grants Congress the power to regulate anything that moves and the power to tax anything that moves and anything that doesn’t move….

If we take the reasoning of Roberts to its logical conclusion, Congress would be able to coerce individuals to buy broccoli once a week, so long as they levy a tax on those who fail to comply with the law.  Putting aside the facial absurdity of Roberts’s tax power jurisprudence, his opinion on the Commerce Clause is nothing to cheer.  While Roberts clearly stated that the Commerce Clause does not grant the federal government the right to regulate inactivity (although it can evidently tax inactivity), he obliquely upheld their authority to regulate any activity under that misconstrued clause.

Amidst the garrulous analysis from the conservative pundit class on the Roberts decision, there is a one-page dissent from Justice Thomas (in addition to his joint dissent with the other 3 conservatives) that has been overlooked….

Take a look at this paragraph from Thomas’s dissent (last two-pages of pdf):

I dissent for the reasons stated in our joint opinion, but I write separately to say a word about the Commerce Clause. The joint dissent and THE CHIEF JUSTICE cor­rectly apply our precedents to conclude that the Individual Mandate is beyond the power granted to Congress under the Commerce Clause and the Necessary and Proper Clause. Under those precedents, Congress may regulate“economic activity [that] substantially affects interstate commerce.” United States v. Lopez, 514 U. S. 549, 560 (1995). I adhere to my view that “the very notion of a ‘substantial effects’ test under the Commerce Clause is inconsistent with the original understanding of Congress’ powers and with this Court’s early Commerce Clause cases.” United States v. Morrison, 529 U. S. 598, 627 (2000) (THOMAS, J., concurring); see also Lopez, supra, at 584–602 (THOMAS, J., concurring); Gonzales v. Raich, 545

….

Justice Thomas is hearkening back to the Founders.  Not only is every word of Obamacare unconstitutional and an anathema to every tenet of our founding, most of the other programs created in recent years are as well.  The fact that Roberts said the Commerce Clause and the Necessary and Proper Clause don’t apply to inactivity is not a victory for constitutional conservatives.  The implicit notion that the federal government can regulate any activity is appalling to conservatives.

Here’s what James Madison had to say about the Commerce Clause in a letter to Joseph C. Cabell in 1829:

For a like reason, I made no reference to the “power to regulate commerce among the several States.” I always foresaw that difficulties might be started in relation to that power which could not be fully explained without recurring to views of it, which, however just, might give birth to specious though unsound objections. Being in the same terms with the power over foreign commerce, the same extent, if taken literally, would belong to it. Yet it is very certain that it grew out of the abuse of the power by the importing States in taxing the non-importing, and was intended as a negative and preventive provision against injustice among the States themselves, rather than as a power to be used for the positive purposes of the General Government, in which alone, however, the remedial power could be lodged.

….

The reality is that not only is Obamacare unconstitutional, almost every discretionary department, welfare program, and entitlement program is unconstitutional…. (Daniel Horowitz, “Thomas Dissents: It’s All Unconstitutional,” RedState (Member Diary), June 29, 2012)

On the general issue of the subversion of constitutional limits on governmental power, see “The Constitution: Original Meaning, Corruption, and Restoration.” Specifically related to Obamacare and the individual mandate: “The Unconstitutionality of the Individual Mandate,” “Does the Power to Tax Give Congress Unlimited Power?,” “Does Congress Have the Power to Regulate Inactivity?,” and “Obamacare: Neither Necessary nor Proper.”

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Also from RedState, a story that reads in part:

Sadly, we have deviated from our constitutional form of government over the past century.  That’s why Mark Levin has written The Liberty Amendments, a set of proposed constitutional amendments that will unambiguously downsize the federal government by targeting specific loopholes that have allowed the statists to adulterate our Constitution.  Far from this being a radically new vision, Levin proves – through founding documents and floor debates at the Constitutional Congress – how his ideas are in line with what the Founders envisioned in our Federal government.  It’s just that after years of deviating from the Constitution, it has become clear that we need very specific limitations on federal abuses – abuses that have gone far beyond the imagination of our Founders – in order to restore the Republic. (Daniel Horowitz, “Mark Levin’s Liberty Amendments,” Red State (Member Diary), August 13, 2013)

The story includes a good summary of Levin’s amendments. Recommended reading.

A New, New Constitution” covers the same ground, and more. It’s long, but it closes a lot of loopholes that have been opened by legislative, executive, and judicial action.

*****

I turn, finally, to a pair of items by James Pethokoukis with self-explanatory titles: “The Great Stagnation: JP Morgan Declares US Potential GDP Growth Just Half of What It Used to Be” (AEIdeas, August 12, 2013) and “Why Wall Street Thinks the Future Isn’t What It Used to Be” (AEIdeas, August 13, 2013). Read those pieces, and then go to “The Stagnation Thesis” (and follow the links therein) and “Why Are Interest Rates So Low?” (which is replete with more links). The latter post concludes with this:

As long as business remains (rightly) pessimistic about the twin burdens of debt and regulation, the economy will sink deeper into stagnation. The only way to overcome that pessimism is to scale back “entitlements” and regulations, and to do so promptly and drastically.

In sum, the present focus on — and debate about — conventional macroeconomic “fixes” (fiscal vs. monetary policy) is entirely misguided. Today’s economists and policy-makers should consult Hayek, not Keynes or Friedman or their intellectual descendants. If economists and policy-makers would would read and heed Hayek — the Hayek of 1944 onward, in particular –  they would understand that our present and future economic morass is entirely political in origin: Failed government policies have led to more failed government policies, which have shackled both the economy and the people.

Economic and political freedoms are indivisible. It will take the repeal of the regulatory-welfare state to restore prosperity and liberty to the land.

Amen.

As for how the regulatory-welfare state might be repealed, read “Restoring Constitutional Government: The Way Ahead.

Obama and Obamacare, Back in the Dumps

Were it not for the fickleness of voters, we would be rid of Obama and Obamacare. Rasmussen’s latest poll results yield a net rating of -22 for Obama and a net rating of -27 for Obamacare. Compare those numbers with the ratings that prevailed from mid-2009 until late summer of 2012; contrast those numbers with Obama’s pre-election surge and short-lived post-election honeymoon:
Obama and Obamacare_approval-disapproval ratings
Sources: Rasmussen Reports, Obama Approval Index History and Health Care Law. Obama’s net disapproval rating measures the percentage of respondents who strongly approve of his performance, minus the percentage of respondents who strongly disapprove of his performance. The ratings for Obamacare are constructed as follows: For the period before Obamacare was signed into law on March 23, 2010, the numbers represent the percentage of respondents who strongly favored the passage of Obamacare, less the percentage of respondents who strongly opposed the passage of Obamacare. From the enactment of Obamacare to the present, the numbers represent the percentage of respondents who have strongly opposed the repeal of Obamacare, minus the percentage of respondents who have strongly favored the repeal of Obamacare.

Death Panels

Obamacare is an obama-nation — no doubt about it. The addition of many millions of persons to the rolls of the insured, at little or no cost to them, will cause the vast majority of Americans to receive worse medical care, and to pay more for it.

The federal government’s takeover of the health-care industry will lead, inevitably, to rationing of the constricted supply of medical products and services (limited by government action, that is). And one aspect of rationing, which was widely predicted years ago, is the establishment of death panels. They won’t be called that, of course, but whatever they are called, their function will be to determine who gets health care and who doesn’t. But that’s all right (isn’t it?) because everyone will be in the same, leaky boat (well, everyone but politicians and the “rich” whom they claim to disdain).

I must admit that I have mixed feelings about death panels. They are abhorrent in principle. But I have three parents and parents-in-law in their doddering, whining, inflexible, troublesome 90s, and I am beginning to think of death panels as a plus. (Though I may change my mind in about 20 years.)

Not-So-Random Thoughts (VI)

Arnold Kling reprises and expands on a point that I have made in “Liberty and Society” (among other posts, linked therein):

My inclination is to approve of organizations that promote group objectives and attempt to limit individual choices, as long as participation in these organizations is voluntary….

I read Adam Smith as approving of social pressure….

In Smith’s psychology, we imagine ourselves being regarded by others, and this imaginative exercise strongly influences our self-regard. Smith seems to me to suggest that this is good for mankind as a whole, because it encourages moral behavior.

Along these lines, there is a tradition within libertarian thought that champions the institutions of civil society as an alternative to statism….

In Hayek’s view, social norms are not the product of one person’s design; rather, they are the outcome of an evolutionary process….

Social norms, like the market, embody knowledge that is beyond the capability of any one individual to possess. I believe that for Hayek, trying to arrive at moral decisions solely on the basis of objective reasoning would be as futile a project as attempting to centrally plan an economy. Either project discards too much useful information to be successful….

I believe that modern research offers support for the views of Smith and Hayek on the nature of human psychology. For example, Jonathan Haidt, in The Righteous Mind, says that we have evolved to care about our status within groups. An important way to achieve status within a group is to adhere to and defend its norms.

One view is that systems of social norms are a necessary ingredient in human progress. For example, Haidt writes,

Moral systems are interlocking sets of values, virtues, norms, practices, identities, institutions, technologies, and evolved psychological mechanisms that work together to suppress or regulate self-interest and make cooperative societies possible.

…[W]e live in a world that demands enormous levels of trust among strangers. We want to be able to use credit cards in remote villages in underdeveloped countries, to be able to buy and sell used goods on eBay, to hire contractors and service workers on Craigslist, and so on. We could not live the way we do if our trust circles were limited to something like a Dunbar number (the 150 or so people we can know well enough personally)….

What I am saying is that we should not become wedded to the view that the world we want is one in which irrational group attachments have been completely eradicated from the human psyche. Yes, this capacity for group attachment is manifest in state-worship that we find troubling. But group norms are a fundamental component of human nature. We probably owe a debt of gratitude to the part of human behavior that becomes irrationally attached to groups and to group norm enforcement.

It may be that the role of libertarians is to point out that political demagogues are exploiting the tribal loyalty instincts of citizens against their better interests, as is typically the case. But it may be neither realistic nor desirable to “educate” people in order that they should lose all sense of group attachment, including attachment to the state. (“Libertarians and Group Norms,” Library of Economics and Liberty)

Kling’s academic even-handedness aside, he is on exactly the right track. Liberty is a social construct, not a Platonic ideal.

*   *   *

Call it selection bias, if you will, but The Hockey Schtick posts a seemingly endless stream of academic papers that refute “warmism” and support natural explanations of the brief period of warming during the final quarter of the 20th century. Go there, and then go to “Anthropogenic Global Warming Is Dead, Just Not Buried Yet, ” and follow the links therein.

*   *   *

Theodore Dalrymple addresses Britain’s National Health Service and rationing:

Traditionally, the NHS has been inexpensive compared with most health-care systems, Britain spending less on its health care per head and as a proportion of GDP than any other developed country. But this reality is changing quickly. The NHS was inexpensive because it rationed care by means of long waiting lists; it also neglected to spend money on new hospitals and equipment. I once had a patient who had been waiting seven years for his hernia operation. The surgery was repeatedly postponed so that a more urgent one might be performed. When he wrote to complain, he was told to wait his turn.

Such rationing has become increasingly unacceptable to the population, aware that it does not occur elsewhere in the developed world. This was the ostensible reason for the Labour government’s doubling of health-care spending between 1997 and 2007. To achieve this end, the government used borrowed money and thereby helped bring about our current economic crisis. Waiting times for operations and other procedures fell, but they will probably rise again as economic necessity forces the government to retrench.

But the principal damage that the NHS inflicts is intangible. Like any centralized health-care system, it spreads the notion of entitlement, a powerful solvent of human solidarity. Moreover, the entitlement mentality has a tendency to spread over the whole of human life, creating a substantial number of disgruntled ingrates.

And while the British government long refrained from interfering too strongly in the affairs of the medical profession, no government can forever resist the temptation to exercise its latent powers. Eventually, it will dictate—because that is what governments and their associated bureaucracies, left to their own devices, and of whatever political complexion, do. The government’s hold over medical practice in Britain is becoming ever firmer; it now dictates conditions of work and employment, the number of hours worked, the drugs and other treatments that may be prescribed, the way in which doctors must be trained, and even what should be contained in applicants’ references for jobs. Doctors are less and less members of a profession; instead, they are production workers under strict bureaucratic control, paid not so much by result as by degree of conformity to directives. (“Universal Mediocrity,” City Journal, Summer 2012)

Rationing? It can’t happen here, right? Wrong. For more, see my “Rationing and Health Care.” “The Perils of Nannyism: The Case of Obamacare,” “More about the Perils of Obamacare.” and “The Rationing Fallacy.”

*   *   *

Cato’s loony libertarians (on matters of defense) once again trot out Herr Doktor Professor John Mueller. He writes:

We have calculated that, for the 12-year period from 1999 through 2010 (which includes 9/11, of course), there was one chance in 22 million that an airplane flight would be hijacked or otherwise attacked by terrorists. (“Serial Innumeracy on Homeland Security,” Cato@Liberty, July 24, 2012)

Mueller’s “calculation” consists of an recitation of known terrorist attacks pre-Benghazi and speculation about the status of Al-Qaeda. Note to Mueller: It is the unknown unknowns that kill you. I refer Herr Doktor Professor to “Riots, Culture, and the Final Showdown” and “Mission Not Accomplished.”

Obamacare and Zones of Liberty

Uwe Reinhardt, a professor of economics at Princeton, offers this tantalizing idea:

Let us set up two distinct systems for health care within our nation. Call one the Social Solidarity system and the other the Libertarian system. Ask young people — at age 25 or so — to choose one or the other.

People joining the Social Solidarity system would know that they will be asked to subsidize their less fortunate fellow citizens in health care through taxes or premiums or both. They would also know, however, that the community will take care of them, and they will not go broke, should serious illness befall them.

People choosing the Libertarian system would not have to pay taxes to subsidize other people’s health care, and they would pay actuarially fair health insurance premiums — low for healthy people and high for sicker people.

Libertarians, however, would not be allowed to come into the Social Solidarity system, unless they were so pauperized as to qualify for Medicaid. Hospitals would have every right to use tough measures to make them pay their medical bills in full, to prevent freeloading at the expense of others.

Furthermore, care would have to be taken to prohibit the kind of estate planning that now often permits well-to-do individuals to take advantage of Medicaid benefits. ["Health Care: Solidarity vs. Rugged Individualism," in Economix, The New York Times, June 29, 2012]

Reinhardt’s suggestion has much merit — his loaded labels aside. The “social solidarity” model really amounts to freeloading, or the futile attempt to freeload. The “rugged individualism” model really amounts to a preference for making one’s own decisions instead of having decisions rammed down one’s throat by government — in other words, a preference for liberty.

But, as I say, the suggestion has merit. And the merit extends far beyond the matter of health care. As John Goodman puts it, “why restrict the choice to health care?”

Which leads to my immodest proposal for zones of liberty:

The 50 States (and their constituent municipalities) are incompatible with the kind of federalism envisioned by the Framers. Today’s State and municipal governments are too bureaucratic and too beholden to special interests; they have become smaller versions of the federal government. For, in today’s populous States and municipalities, coalitions of minority interests are able to tyrannize the populace. (The average State today controls the destinies of 25 times as many persons as did the average State of 1790.) Those Americans who “vote with their feet” through internal migration do not escape to regimes of liberty so much as they escape to regimes that are less tyrannical than the ones in which they had been living.

The kind of federalism envisioned by the Framers — and the kind of federalism necessary to liberty — would require the devolution to small communities and neighborhoods of all but a few powers: war-making, the conduct of foreign affairs, and the regulation of inter-community commerce for the sole purpose of ensuring against the erection of barriers to trade. With that kind of federalism, the free markets of ideas and commerce would enable individuals to live in those communities and neighborhoods that best serve their particular conceptions of liberty.

What do I have in mind? A zone of liberty would be something like a “new city” — with a big difference. Uninhabited land would be acquired by a wealthy lover (or lovers) of liberty, who would establish a development authority for the sole purpose of selling the land in the zone. The zone would be populated initially by immigrants from other parts of the United States. The immigrants would buy parcels of land from the development authority, and on those parcels they could build homes or businesses of their choosing. Buyers of parcels would be allowed to attach perpetual covenants to the parcels they acquire, and to subdivide their parcels with (or without) the covenants attached. All homes and businesses would have to be owned by residents of the zone, in order to ensure a close connection between property interests and governance of the zone.

Infrastructure would be provided by competing vendors of energy, telecommunications, and transportation services (including roads and their appurtenances). Rights-of-way would be created through negotiations between vendors and property owners. All other goods and services — including education and medical care — would be provided by competing vendors. No vendor, whether or not a resident of the zone, would be subject to any regulation, save the threat of civil suits and prosecution for criminal acts (e.g., fraud). Any homeowner or business owner could import or export any article or service from or to any place, including another country; there would be no import controls, duties, or tariffs on imported or exported goods and services.

The zone’s government would comprise an elected council, a police force, and a court (all paid for by assessments based on the last sale price of each parcel in the zone). The police force would be empowered to keep the peace among the residents of the zone, and to protect the residents from outsiders, who would be allowed to enter the zone only with the specific consent of resident homeowners or business owners. Breaches of the peace (including criminal acts) would be defined by the development of a common law through the court. The elected council (whose members would serve single, four-year terms) would oversee the police force and court, and would impose the assessments necessary to defray the costs of government. The council would have no other powers, and it would be able to exercise its limited powers only by agreement among three-fourths of the members of the council. The members, who would not be salaried, would annually submit a proposed budget to the electorate, which would have to approve the budget by a three-fourths majority. The electorate would consist of every resident who is an owner or joint owner of a residence or business (not undeveloped land), and who has attained the age of 30.

A zone of liberty would not be bound by the laws (statutory and otherwise) of the United States, the individual States, or any of political subdivision of a State. (The federal government could impose a per-capita tax on residents of the zone, in order to defray the zone’s per-capita share of the national budget for defense and foreign affairs.) The actions of the zone’s government would be reviewable only by the U.S. Supreme Court, and then only following the passage of a bill of particulars by two-thirds of each house of Congress, and with  the concurrence the president. (A zone could be abolished only with the approval of four-fifths of each house of Congress, and with the concurrence of the president.)

Absent such an experiment, I see only one hope for liberty — albeit a slim one — a Supreme Court that revives the Constitution. Politics as usual will only take us further down the road to serfdom.

I wrote that two years ago, and it is based on a post that is now more than six years old. Much has happened since, almost all of it to the detriment of liberty. Would our rulers dare allow at least a few of us to undertake an experiment in liberty? It is doubtful, because they fear the possibility that the experiment would succeed. And if it did, they would face the prospect of demands for more of the same. And where would that leave them? Without vast power. Scratch the idea of asking the federal government or any State government for a zone of liberty.

But maybe it isn’t necessary to ask. Suppose that a new (unincorporated) city were to spring up in, say, an isolated county with a friendly government. Suppose, further, that the new city’s citizens were to do nothing to organize themselves but (a) set up a police department and (b) hire legal counsel to ensure that the residents obey those State and federal laws that they must obey. And suppose that the city were to be an economic and social success, despite the absence of all of the codes and ordinances that ensnare the residents and businesses of today’s typical city.

Isn’t it worth a try? And doesn’t it beat trying to entice libertarians to move to New Hampshire (brrr!) or to live in international waters (pirates off the bow)?

Obama: Not Bailed out by CJ Roberts

UPDATED 07/03/12

Chief Justice Roberts’s bailout of Obama care — a.k.a. CJ Roberts’s sellout — may have brought some wavering believers in big government back into the corral, but probably not enough of them to rescue Obama from defeat at the hands of Mitt Romney. I continue to forecast a Romney win over Obama, the strong possibility of a GOP takeover of the Senate, and approximately no change in the GOP’s large House majority (see left sidebar).

Further evidence for my forecasts, is found in Scott Rasmussen’s polls about the “popularity” (i.e., unpopularity) of Obama and Obamacare:


Sources: Rasmussen Reports, Obama Approval Index History and Health Care Law.

The latest poll results show a net disapproval rating of -18 for Obama (as of July 3) and a net disapproval rating of -14 for Obamacare (as of June 29-30, the two days immediately following CJ Roberts’s bombshell).

Obama’s net disapproval rating measures the percentage of respondents who strongly approve of his performance, minus the percentage of respondents who strongly disapprove of his performance. It has been three years since the arithmetic yielded a positive number, which is why I usually refer to the poll results as Obama’s disapproval or unpopularity rating.

The ratings for Obamacare are constructed as follows: For the period before Obamacare was signed into law on March 23, 2010, the numbers represent the percentage of respondents who strongly favored the passage of Obamacare, less the percentage of respondents who strongly opposed the passage of Obamacare. From the enactment of Obamacare to the present, the numbers represent the percentage of respondents who have strongly opposed the repeal of Obamacare, minus the percentage of respondents who have strongly favored the repeal of Obamacare.

Needless to say, Obamacare has always been in negative territory. In the latest poll (June 29-30) it gained only one percentage point from the poll conducted a week earlier. The recent uptick began in May, probably as a result of the intense p.r. campaign conducted by Obama and other Democrats (most notably Sen. Patrick Leahy, chairman of the Senate Judiciary Committee).

The save-Obamacare campaign may have worked on CJ Roberts, but its overall effect has been small. In fact, the recent gain in popularity is minuscule in comparison to the bandwagon-effect gain that began in January 2010 — when it became clear that Obamacare would become law — and continued until the eve of enactment on March 23, 2010.

The real silver lining in the Supreme Court’s Obamacare decision — if there is any silver lining — is that the Obamacare target still hangs from Obama’s neck.

Another Thought or Two about the Obamacare Decision

In the preceding post, I alluded to commentators who found silver linings in Chief Justice Roberts’s alignment with the Court’s liberal wing in upholding the individual mandate. I feel compelled to say more about the supposed silver linings.

I begin with Ilya Somin, writing at The Volokh Conspiracy:

Although the Supreme Court upheld the individual mandate as an exercise of the Tax Power, a majority of the justices also ruled that it is not a legitimate exercise of Congress’ powers under the Commerce Clause. In doing so, they endorsed the plaintiffs’ argument that the individual mandate exceeds the scope of the Commerce power because it does not regulate “economic activity,” but instead targets inactivity.

But, as Somin points out:

The problem is that Roberts then proceeds to “empower Congress to make those decisions [to buy health insurance]” for us under the guise of imposing taxes.

Why did Roberts not simply join the four dissenting justices and throw out Obamacare while making clear the limits on Congress’s Commerce Clause power? The same (hypothetical) majority opinion also would have found unconstitutional the feds’ expansion of Medicaid.

Sean Trende, writing at RealClearPolitics, has much to say in Roberts’s defense, including this:

Thursday’s health care ruling shocked most observers. It upheld the health care law as constitutional. But rather than find that the law was justified under Congress’ authority to regulate commerce, it instead found it was justified only under Congress’ power to tax. It also imposed limits upon Congress’ ability to condition spending grants to the states upon those states taking certain steps. To my knowledge, former Solicitor General Walter Dellinger was the only person who thought that the court would ultimately rule on those grounds. I certainly was surprised.

Even more surprising, the decision was 5-4, and Chief Justice John Roberts authored the majority opinion upholding the law, rather than Anthony Kennedy. Conservatives are flabbergasted by the chief’s decision (or, in their view, betrayal)….

But I think if you scratch the surface here, Roberts embarked upon a gambit much like [Chief Justice John] Marshall did 200 years ago [in Marbury v. Madison]

Let’s start with Roberts’ presumed crass political considerations. Namely, as a conservative Republican, he would not want the health care law implemented….

If Republicans win the Senate and presidency, the law is doomed. They will use reconciliation to repeal it, or to gut it….

And the decision may help to ensure a GOP sweep in November by energizing unenthusiastic conservatives and fiscally prudent independents.

Trende continues:

Five justices just signaled to lower courts that, but for the unique taxation power argument, they were prepared to rule that a major act of Congress that plainly touched upon economic activity exceeded Congress’ commerce powers….

The most important aspect of the ruling, however, comes with respect to the spending clause. Seven justices just agreed to real limits on Congress’ ability to attach strings to legislation. This is significant. Until today, these limits were hypothetical, and it was believed that Congress could, for example, remove all Medicaid funding as a punishment for a state’s refusal to comply with the Medicaid expansion. I did not expect the court to rule the way it did here, much less to do so by a 7-2 vote….

Roberts has basically … [i]nsulate[d] the court from criticism of bald partisan bias and infidelity to, as he once put it, calling balls and strikes. He’s earning plaudits from the left. Though the right is grumbling, I suspect they won’t be doing so for long.

This is not the last battle to be fought on the Roberts Court. It might not even be the most significant. In the next term, for example, the court is being asked to reconsider its affirmative action jurisprudence. There are almost certainly five votes to overturn court rulings from a decade ago upholding some forms of affirmative action.

Following that, the court will face a variety of tough decisions. There are probably five votes to uproot the entire campaign finance system, a decision that would make Citizens United look like small fry. And there are probably five votes to invalidate Section 5 of the Voting Rights Act.

I don’t think invalidating the ACA would have affected the court’s legitimacy that much, at least outside of liberals in the legal academy. But taken as a whole, this series of decisions really might have irrevocably hurt the court’s reputation for independence.

But Roberts has something of an ace up his sleeve now. Accusations of hyper-partisanship are much harder to make against him, and he has more freedom to move on these issues….

Yes, but Roberts and his conservative brethren have life tenure, and what the public thinks about the Court surely is less important that what the Court does. Giving ground to seem “nice” is a classic conservative blunder.

Perhaps I can find solace in a column by Tom Socca, writing at Slate:

There were two battles being fought in the Supreme Court over the Affordable Care Act. Chief Justice John Roberts—and Justice Anthony Kennedy—delivered victory to the right in the one that mattered….

The scholars expected to see the court gut existing Commerce Clause precedent and overturn the individual mandate in a partisan decision: Five Republican-appointed justices voting to rewrite doctrine and reject Obamacare; four Democratic-appointed justices dissenting.

Roberts was smarter than that. By ruling that the individual mandate was permissible as a tax, he joined the Democratic appointees to uphold the law—while joining the Republican wing to gut the Commerce Clause (and push back against the necessary-and-proper clause as well)….

This is a substantial rollback of Congress’ regulatory powers, and the chief justice knows it. It is what Roberts has been pursuing ever since he signed up with the Federalist Society. In 2005, Sen. Barack Obama spoke in opposition to Roberts’ nomination, saying he did not trust his political philosophy on tough questions such as “whether the Commerce Clause empowers Congress to speak on those issues of broad national concern that may be only tangentially related to what is easily defined as interstate commerce.” Today, Roberts did what Obama predicted he would do.

Roberts’ genius was in pushing this health care decision through without attaching it to the coattails of an ugly, narrow partisan victory. Obama wins on policy, this time. And Roberts rewrites Congress’ power to regulate, opening the door for countless future challenges. In the long term, supporters of curtailing the federal government should be glad to have made that trade.

This strikes me as more of the same. But perhaps Trende and Socca are on to something. Roberts, by reaching out the the Court’s left, may have gained useful allies for future fights. Kennedy, despite his surprising (to me) absolute opposition to Obamacare, can and will stray off the conservative reservation without warning.

There is also the important and still-to-be-decided issue of Obamacare’s effects on religious freedom. This is from a post by Sarah Marshall and Jennifer Torre at The Foundry:

…The Court’s ruling to uphold Obamacare doesn’t mean the law has cleared its legal challenges, however. Twenty-three federal lawsuits against Obamacare’s Health and Human Services (HHS) mandate—which goes into effect on August 1—now take on added urgency….

The HHS anti-conscience mandate is a completely separate rule from the individual mandate, and its constitutionality was not considered by the Supreme Court in the cases decided today. The HHS mandate, along with the individual mandate and the rest of Obamacare, still presents a clear threat to individual and religious liberty. Nothing short of full repeal of the statute will adequately protect our freedoms from this federal overreach.

The next legal battleground against Obamacare resides in the fight to protect employers from the coercive requirement to provide coverage of abortion-inducing drugs, contraception, and sterilization under the HHS mandate….

Obamacare’s anti-conscience mandate affords the narrowest religious exemption in federal law, effectively covering only formal houses of worship. Countless other religious employers, like schools, hospitals, and religious charities, are forced to provide coverage for the mandated services despite moral or religious objections—simply because they step outside the four walls of a church to serve others.

Creating the choice to violate conscience or forgo providing health insurance entirely—and risk hefty fines under Obamacare—the HHS mandate profoundly and adversely affects many employers and the people they serve….

Perhaps this is one of the fights anticipated by Roberts. And perhaps he wants to win it by more than 5-4 (or to ensure that he wins it). Robert John Araujo of Mirror of Justice has some related thoughts:

[The following observation of Justice Ginsburg and her colleagues in their partial concurrence and dissent might suggest that the debate and probably the litigation involving the legality of this legislation will continue for some time to come. As she says about the provisions of the Constitution that exist to check Congressional overreaching:

A mandate to purchase a particular product would be unconstitutional if, for example, the edict impermissibly abridged the freedom of speech, interfered with the free exercise of religion, or infringed on a liberty interest protected by the Due Process Clause.

…[I]t would appear that this subject which Justice Ginsburg, and those who agree with her, has identified may well be in the courts in the not-too-distant future [as discussed in the preceding quotation].

Could Roberts be angling to enlist Ginsburg as an ally in the looming freedom-of-conscience cases? That strikes me as a long shot because Ginsburg — “good” statist that she is, will no doubt find a way to wiggle out of her implied commitment to the free exercise of religion. But Roberts’s real targets may be Justices Breyer and Kagan, who joined his opinion — including the ruling that the expansion of Medicaid was unduly coercive of the States.

If Roberts has made the political calculations attributed to him — and I wouldn’t be surprised if he has — my only wish is that his calculations prove correct. If they are not, he simply will have wasted what would have been a perfectly good majority opinion, namely, the dissent of Justices Scalia, Kennedy, Thomas, and Alito.

Obamacare, Slopes, Ratchets, and the Death Spiral of Liberty

Today’s ruling by the U.S. Supreme Court in the matter of Obamacare (National Federation of Business et al. v. Sebelius, Secretary of Health and Human Services, et al.) is portrayed by some commentators as a victory of sorts for limited government. Consider the following excerpts of the Syllabus:

[T]he individual mandate is not a valid exercise of Congress’s power under the Commerce Clause and the Necessary and Proper Clause….

The power to regulate commerce presupposes the existence of commercial activity to be regulated. This Court’s precedent reflects this understanding: As expansive as this Court’s cases construing the scope of the commerce power have been, they uniformly describe the power as reaching “activity.”…  The individual mandate, however, does not regulate existing commercial activity. It instead compels individuals to become active in commerce by purchasing a product, on the ground that their failure to do so affects interstate commerce.

Construing the Commerce Clause to permit Congress to regulate individuals precisely because they are doing nothing would open a new and potentially vast domain to congressional authority. Congress already possesses expansive power to regulate what people do. Upholding the Affordable Care Act under the Commerce Clause would give Congress the same license to regulate what people do not do. The Framers knew the difference between doing something and doing nothing. They gave Congress the power to regulate commerce, not to compel it. Ignoring that distinction would undermine the principle that the Federal Government is a government of limited and enumerated powers. The individual mandate thus cannot be sustained under Congress’s power to “regulate Commerce.”…

Nor can the individual mandate be sustained under the Necessary and Proper Clause as an integral part of the Affordable Care Act’s other reforms. Each of this Court’s prior cases upholding laws under that Clause involved exercises of authority derivative of, and in service to, a granted power…. The individual mandate, by contrast, vests Congress with the extraordinary ability to create the necessary predicate to the exercise of an enumerated power and draw within its regulatory scope those who would otherwise be outside of it. Even if the individual mandate is “necessary” to the Affordable Care Act’s other reforms, such an expansion of federal power is not a “proper” means for making those reforms effective.

So far, so good, but

for the reasons explained, the Commerce Clause does not give Congress that power.It is therefore necessary to turn to the Government’s alternative argument: that the mandate may be upheld as within Congress’s power to “lay and collect Taxes.”… In pressing its taxing power argument, the Government asks the Court to view the mandate as imposing a tax on those who do not buy that product. Because “every reasonable construction must be resorted to, in order to save a statute from unconstitutionality,”… the question is whether it is “fairly possible” to interpret the mandate as imposing such a tax….

The Affordable Care Act describes the “[s]hared responsibility payment” as a “penalty,” not a “tax.” That label is fatal to the application of the Anti-Injunction Act. It does not, however, control whether an exaction is within Congress’s power to tax. In answering that constitutional question, this Court follows a functional approach,“[d]isregarding the designation of the exaction, and viewing its substance and application.”…

Such an analysis suggests that the shared responsibility payment may for constitutional purposes be considered a tax.

What a strange tax it is that must be paid to the government in order to breathe life into a program for which there is no constitutional remit in the “limited and enumerated powers” of the government. The government’s powers to tax and spend are not open-ended; they must serve a constitutional purpose.

There is more:

[T]he Medicaid expansion violates the Constitution by threatening States with the loss of their existing Medicaid funding if they decline to comply with the expansion….

The Spending Clause grants Congress the power “to pay the Debts and provide for the . . . general Welfare of the United States.”… Congress may use this power to establish cooperative state-federal Spending Clause programs. The legitimacy of Spending Clause legislation, however, depends on whether a State voluntarily and knowingly accepts the terms of such programs…. When Congress threatens to terminate other grants as a means of pressuring the States to accept a Spending Clause program, the legislation runs counter to this Nation’s system of federalism….

Under the Affordable Care Act, Medicaid is transformed into a program to meet the health care needs of the entire nonelderly population with income below 133 percent of the poverty level. A State could hardly anticipate that Congress’s reservation of the right to “alter” or “amend” the Medicaid program included the power to transform it so dramatically. The Medicaid expansion thus violates the Constitution by threatening States with the loss of their existing Medicaid funding if they decline to comply with the expansion….

The constitutional violation is fully remedied by precluding the Secretary from … withdraw[ing] existing Medicaid funds for failure to comply with the requirements set out in the expansion.

Again, gratifying as the holding may be to some parties, it assumes (and therefore affirms) the constitutionality of an act that “meet[s] he health care needs of the entire nonelderly population with income below 133 percent of the poverty level.” Where does the Constitution set forth Congress’s power to do any such thing?

My outrage is echoed in the dissent by Justices Scalia, Kennedy, Thomas, and Alito; for example:

The striking case of Wickard v. Filburn, … , which held that the economic activity of growing wheat, even for one’s own consumption, affected commerce sufficiently that it could be regulated, always has been regarded as the ne plus ultra of expansive Commerce Clause jurisprudence. To go beyond that, and to say the failure to grow wheat (which is not an economic activity, or any activity at all) nonetheless affects commerce and therefore can be federally regulated, is to make mere breathing in and out the basis for federal prescription and to extend federal power to virtually all human activity.

As for the constitutional power to tax and spend for the general welfare: The Court has long since expanded that beyond (what Madison thought it meant) taxing and spending for those aspects of the general welfare that were within the Federal Government’s enumerated powers… Thus, we now have sizable federal Departments devoted to subjects not mentioned among Congress’ enumerated powers, and only marginally related to commerce: the Department of Education, the Department of Health and Human Services, the Department of Housing and Urban Development. The principal practical obstacle that prevents Congress from using the tax-and-spend power to assume all the general-welfare responsibilities traditionally exercised by the States is the sheer impossibility of managing a Federal Government large enough to administer such a system. That obstacle can be overcome by granting funds to the States, allowing them to administer the program. That is fair and constitutional enough when the States freely agree to have their powers employed and their employees enlisted in the federal scheme. But it is a blatant violation of the constitutional structure when the States have no choice.

The Act before us here exceeds federal power both in mandating the purchase of health insurance and in denying nonconsenting States all Medicaid funding. These parts of the Act are central to its design and operation, and all the Act’s other provisions would not have been enacted without them. In our view it must follow that the entire statute is inoperative.

Amen to that. And the same goes for Social Security and Medicare. (My words, not the words of the dissenting justices, unfortunately.)

Where does today’s ruling leave Americans? Further down the slippery slope to serfdom. The “slippery slope” is

an argument for the likelihood of one event or trend given another. Invoking the “slippery slope” means arguing that one action will initiate a chain of events that will lead to a (generally undesirable) event later. The argument is sometimes referred to as the thin end of the wedge or the camel’s nose.

That is to say, once it became accepted that the federal government could establish programs like Social Security, Medicare, and Medicaid, it became relatively easy to expand those programs to encompass the “national emergency” of the day. And so, the stage has been set for  government-run health care in the United States, with all that goes with it: long queues, worse care, rationing, and death panels, and more.

Another metaphor for the inexorable engrossment of state power is the ratchet effect,

the commonly observed phenomenon that some processes cannot go backwards once certain things have happened, by analogy with the mechanical ratchet that holds the spring tight as a clock is wound up.

The acceptance of the status quo (Social Security, Medicare, and Medicaid) as a baseline sets the stage for a ratcheting up to a new, more expansive and expensive status quo (Obamacare), on the ground that if X is good, X+ will be better. That X is good and X+ will be better are articles of faith, which become widely accepted without serious consideration of the burden they impose on the most productive citizens, the negative effect of that burden on the nation’s economy, or the liberty of the people. It has been heartening that most Americans have opposed Obamacare, in the main because of the perceived insult to liberty known as the individual mandate. But, alas, a majority of the Supreme Court has found a legalistic way in which to ratchet up the mainspring of government power.

Perhaps the best metaphor for today’s ruling is the death spiral. Reliance on government usually creates more problems than it solves. But, having become accustomed to relying on government, most Americans rely on government to deal with the problems caused by government’s previous enactments. That only makes matters worse, which causes Americans to rely further on government, etc., etc. etc.

In the case of Obamacare, what we have is a reaction to the high costs of medical services and the presumed failure of markets to provide adequate health care for large chunks of the population. It escapes the notice of most Americans — and is of no interest to most politicians — that the high costs and supposed “market failures” are due to government action: tax subsidies for employer-provided insurance (which results in an artificially high demand for medical services); mandated insurance coverages; barriers to interstate competition in insurance markets; the FDA’s long, death-inducing approval process for new drugs; the AMA’s government-sponsored stranglehold on the training and licensing of doctors; a similar stranglehold on the establishment of health-care facilities; and on and on.This is the real “national emergency,” which today’s majority blithely ignored in its quest to find an extra-constitutional (i.e., precedential) basis for the further expansion of government power.

It is long past time for Americans to declare their independence from the legislative, executive, and judicial tyranny under which we labor for the benefit of politicians, bureaucrats, and freeloaders.

Directly related posts:
Fear of the Free Market — Part I
Fear of the Free Market — Part II
Fear of the Free Market — Part III
Free-Market Healthcare
Social Security Is Unconstitutional
Rationing and Health Care
The Perils of Nannyism: The Case of Obamacare
More about the Perils of Obamacare
Health-Care Reform: The Short of It
The Unconstitutionality of the Individual Mandate
Does the Power to Tax Give Congress Unlimited Power?
Does Congress Have the Power to Regulate Inactivity?

Posts about government power, its effects, and ways to combat it:
FDR and Fascism
The People’s Romance
Fascism
Fascism with a “Friendly” Face
Secession
Democracy and Liberty
The Interest-Group Paradox
Is Statism Inevitable?
Inventing “Liberalism”
The Price of Government
A New, New Constitution
Zones of Liberty
Fascism and the Future of America
Secession Redux
A New Cold War or Secession?
The Price of Government Redux
The Real Constitution and Civil Disobedience
The Near-Victory of Communism
A Declaration of Independence
The Mega-Depression
Tocqueville’s Prescience
First Principles
As Goes Greece
Accountants of the Soul
Ricardian Equivalence Reconsidered
Zones of Liberty
The Constitution: Original Meaning, Corruption, and Restoration
Society and the State
I Want My Country Back
Estimating the Rahn Curve: Or, How Government Inhibits Economic Growth
The Bowles-Simpson Report
The Bowles-Simpson Band-Aid
Regime Uncertainty and the Great Recession
Re-Forming the United States
The Stagnation Thesis
Taxing the Rich
More about Taxing the Rich
America’s Financial Crisis Is Now
The Southern Secession Reconsidered
A Declaration of Civil Disobedience
The Repealer
Regulation as Wishful Thinking
The Real Multiplier
Vulgar Keynesianism and Capitalism
Why Are Interest Rates So Low?
The Commandeered Economy
Estimating the Rahn Curve: A Sequel
In Defense of the 1%
The Real Multiplier (II)
Lay My (Regulatory) Burden Down
The Burden of Government
Constitutional Confusion
Reclaiming Liberty throughout the Land
Economic Growth Since World War II
More Evidence for the Rahn Curve

In Mourning

I am in mourning for liberty in the United States, which has been killed by today’s ruling by the U.S. Supreme Court. Thus the black band at the top of this blog.

More to come.

UPDATE (09/06/13)

I’ve gone back to red because I’m fighting mad, and plan to stay that way.

Obama and Obamacare: Twin Disasters

A picture worth 2,000 words:


Sources: Rasmussen Reports, Obama Approval Index History and Health Care Law.

I could have added graphs about the unemployment rate  (2 percentage points above the peak reached during GWB’s administration), the employment/population ratio (5 percentage points below the GWB peak), and the federal debt (which has grown almost 50 percent in the 3 years and 3 months of Obama’s presidency, as against a 25-percent rise in the first 3 years and 3 months of GWB’s presidency) — but why rub it in?

Not-So-Random Thoughts (I)

Secession

Ilya Somin, writing at The Volokh Conspiracy, on secession:

The US Constitution, of course, is one of many where secession is neither explicitly banned or explicitly permitted. As a result, both critics and defenders of a constitutional right of secession have good arguments for their respective positions. Unlike the preceding Articles of Confederation, the Constitution does not include a Clause stating that the federal union is “perpetual.” While the Articles clearly banned secession, the Constitution is ambiguous on the subject.

Even if state secession is constitutionally permissible, the Confederate secession of 1861 was deeply reprehensible because it was undertaken for the profoundly evil purpose of perpetuating and extending slavery. But not all secession movements have such motives. Some are undertaken for good or at least defensible reasons. In any event, there is nothing inherently contradictory about the idea of a legal secession.

Of course, whether or not a secession is legal, it may be morally justified. Conversely, a legal secession may be morally unjustified, as was the case with the Southern secession. But the history of the Southern secession does not taint the legal and moral grounds for secession. As I say here,

The constitutional contract is a limited grant of power to the central government, for the following main purposes: keeping peace among the States, ensuring uniformity in the rules of inter-State and international commerce, facing the world with a single foreign policy and a national armed force, and assuring the even-handed application of the Constitution and of constitutional laws. That is all.

It is clear that the constitutional contract has been breached. It is clear that the Constitution’s promise to “secure the Blessings of Liberty to ourselves and our Posterity”  has been blighted.

Desperate times require desperate measures. I suggest that we begin at the beginning, with a new Declaration of Independence, and proceed from there to a new Constitution.

Obamacare

In a post at The American, John F. Gaski writes:

On the central issue of ObamaCare’s notorious mandate—i.e., whether it is constitutional for the federal government to compel a consumer purchase—everything hinges on the U.S. Constitution’s Commerce Clause. That element of the Constitution gives the federal government authority to regulate interstate commerce or activities affecting it. So far, so reasonable.

But the crux of the issue is whether forcing Americans to buy healthcare is regulation of commerce in the first place. Opponents note that non-purchase of healthcare should not be considered commerce or commerce-related activity. ObamaCare apologists, including some federal judges, make the remarkable claim that a decision not to purchase qualifies as interstate commerce or activity affecting interstate commerce, the same as a decision to purchase or a purchase itself. But even the non-partisan Congressional Research Service, in its 2009 assessment of likely PPACA constitutionality, acknowledged that Commerce Clause-based federal regulatory authority targets genuine activities that affect interstate commerce, not inactivity.

How to resolve this disagreement? The answer is staring us in the face, but has remained obscure to some lawyers and jurists who cannot quite see the forest for the trees. All you really need to know is what the word “commerce” means. To wit, commerce is “exchange of goods, products, or property . . . ; extended trade” (Britannica World Language Dictionary, 1959); “the buying and selling of goods . . .; trade” (Webster’s New World Dictionary, 1964); “the buying and selling of commodities; trade” (The Merriam-Webster Dictionary, 1974); “interchange of goods or commodities, especially on a large scale . . . ; trade; business” (Dictionary.com, 2012). Uniformly, we see, the definition of commerce involves activity, not just a decision to act, and certainly not a decision to not act. The meaning of the concept of commerce presumes action, and always has. Moreover, even casual philology will confirm that the accepted meaning of “commerce” at the time of the Constitution’s drafting referenced activity, not inactivity, at least as much then as it does now (see C. H. Johnson, William & Mary Bill of Rights Journal, October 2004). In the same way, the Commerce Clause has long been construed to apply to action in or affecting commerce, from the 1824 Gibbons v. Ogden Supreme Court case onward.

I am in complete agreement:

[T]he real issue … comes down to this: Does Congress’s power to regulate interstate commerce extend to “health care” generally, just because some aspects of it involve interstate commerce? In particular, can Congress constitutionally impose the individual mandate under the rubric of the Commerce Clause or the Necessary and Proper Clause?…

It is safe to say that a proper reading of the Constitution, as exemplified in the authoritative opinions excerpted above, yields no authority for Obamacare. That monstrosity — the official, Orwellian title of which is the Patient Protection and Affordable Care Act (PPACA) — attempts to reach an aggregation known as “health care,” without any differentiation between interstate commerce, intrastate commerce, and activities that are part of neither, namely, the choices of individuals with respect to health insurance.

It may be a valid exercise of Congress’s power to regulate actual interstate commerce that touches on the provision of health care. It is not a valid exercise to aggregate everything called “health care” and to regulate it as if it were all within the reach of Congress. When that happens, there is no room left — in “health care” nor, by extension, any other loose aggregation of activities — for State action or individual choice.

In sum, Obamacare is neither a valid regulation of interstate commerce nor necessary and proper to a valid regulation of interstate commerce. It is a governmental seizure of 1/9th of the economy. The individual mandate — which is a central feature of that seizure — is nothing more than coercion. It is no less peremptory than the military draft.

Freedom of Conscience

Yes, Virginia, there is freedom of conscience in Virginia:

A bill that ensures that faith-based adoption agencies in the state of Virginia won’t be forced to place children in households led by same-sex couples has passed both houses of the General Assembly and is heading to the desk of Gov. Robert McDonnell, a supporter of the legislation, who is expected to sign it soon.

Gov. McDonnell and the majorities in the Virginia legislature are standing up for freedom of conscience, which is among the negative rights that is trampled by grants of  “positive rights” (i.e., privileges). These

are the products of presumption — judgments about who is “needy” and “deserving” — and they are bestowed on some by coercing others. These coercions extend not only to the seizure of income and wealth but also to denials of employment (e.g., affirmative action), free speech (e.g., campaign-finance “reform”), freedom of contract (e.g., mandatory recognition of unions), freedom of association (e.g., forced admission of certain groups to private organizations), freedom of conscience (e.g., forced participation in abortions), and on and on.

Income Inequality

Thomas A. Garrett, a sensible economist, says good things about income inequality:

The apparent increase in U.S. income inequality has not escaped the attention of policymakers and social activists who support public policies aimed at reducing income inequality. However, the common measures of income inequality that are derived from the census statistics exaggerate the degree of income inequality in the United States for several reasons. Furthermore, although income inequality is seen as a social ill by many people, it is important to understand that income inequality has many economic benefits and is the result of, and not a detriment to, a well-functioning economy….

…[O]ver time, a significant number of households move to higher positions along the income distribution and a significant number move to lower positions along the income distribution. Common reference to “classes” of people (e.g., the lowest 20 percent, the richest 10 percent) is very misleading because income classes do not contain the same households and people over time….

The unconstrained opportunity for individuals to create value for society, which is reflected by their income, encourages innovation and entrepreneurship. Economic research has documented a positive correlation between entrepreneurship/innovation and overall economic growth.9 A wary eye should be cast on policies that aim to shrink the income distribution by redistributing income from the more productive to the less productive simply for the sake of “fairness.” 10 Redistribution of wealth would increase the costs of entrepreneurship and innovation, with the result being lower overall economic growth for everyone.

I am losing track of the posts in which I have made the same points. See this one and this one, and the posts linked in each of them.

The Left-Libertarian (“Liberal”) Personality vs. Morality

Will Wilkinson, a left-libertarian (i.e., modern “liberal”) if ever there was one, writes about his score on the Big-Five Personality Test:

I score very high in “openness to experience” and worryingly low in “conscientiousness”.

A true libertarian (i.e., a Burkean) would score high on “openness to experience” and high on “conscientiousness” — as I do.

As I have said, differences

between various libertarian camps and between libertarians, Burkean conservatives, yahoo conservatives, “liberals,” and so on — are due as much to differences of temperament as they are to differences in knowledge and intelligence.

But temperament is a reason for political error, not an excuse for it:

[T]he desirability or undesirability of state action has nothing to do with the views of “liberals,” “libertarians,” or any set of pundits, “intellectuals,” “activists,” and seekers of “social justice.” As such, they have no moral standing, which one acquires only by being — and acting as — a member of a cohesive social group with a socially evolved moral code that reflects the lessons of long coexistence. The influence of “intellectuals,” etc., derives not from the quality of their thought or their moral standing but from the influence of their ideas on powerful operatives of the state.

See also:
Libertarianism and Morality
Libertarianism and Morality: A Footnote

Obamacare: Neither Necessary Nor Proper

This is from my post “The Unconstitutionality of the Individual Mandate“:

The Constitution simply gives Congress the power to regulate interstate commerce. And not all activities comprised in “health care” occur in transactions that are properly considered interstate commerce. In fact, significant portions of it (e.g., the manufacture of products used in health care, the use of those products by health-care providers, and the personal services rendered by health-care providers) clearly occur outside the activities properly understood as interstate commerce: the sale and transmission of goods (tangible and intangible) across State lines.

With regard to the second question, it follows that the mandate cannot be “necessary and proper” if Congress lacks the authority to regulate “the massive interstate market in health care,” in the first place….

…If the power of Congress to regulate “health care” cannot be found in its power to regulate interstate commerce, where can it be found? Nowhere in the Constitution. And if such a power cannot be found in the Constitution, then there can be no “necessary and proper” law that requires individuals to buy health insurance….

The defenders of Obamacare and the individual mandate would argue that it is “necessary and proper” to regulate activities (commercial or not) that are tangentially related to the portion of “health care” that is comprised in interstate commerce. That is so, in their view, because otherwise the effort to regulate the portion comprised in interstate commerce would fail to have the desired effect. In other words, they would regulate everything that can be labeled “health care,” and everything beyond that which threatens to undermine the intended regulatory outcome.

In so many words, the defenders of Obamacare and the individual mandate, like many others before them, want Congress to have the power to regulate anything and everything that they want Congress to regulate….

James Madison held the same view:

…[T]he Constitution did not give Congress the power to establish an incorporated bank. Hamilton, [Madison] said, was urging the legislators to charter the bank based on the power that Article I, Section 8 of the Constitution gives them “to make all laws which shall be necessary and proper for carrying into Execution the foregoing Powers”—specific, limited powers that the section had just enumerated. But notice what “ductile” language Hamilton must use “to cover the stretch of power contained in the bill.” As the bill puts it, the bank “might be conceived to be conducive to the successful conducting of the finances; or might be conceived to tend to give facility to the obtaining of loans,” Madison quoted, adding emphasis oozing with incredulous contempt. So to begin with, the bank wasn’t even “necessary,” as the “necessary and proper” clause required; “at most it could be but convenient.”

Worse, Madison suggested, Hamilton’s reliance on a doctrine of implied powers instead of explicit ones courted disaster. “The doctrine of implication is always a tender one,” he warned. “Mark the reasoning” behind the bill: “To borrow money is made the end and the accumulation of capitals, implied as the means. The accumulation of capitals is then the end, and a bank implied as the means.” By such a chain of implication, we end up with “a charter of incorporation, a monopoly, capital punishments, &c.,” until finally we take in “every object of legislation, every object within the whole compass of political economy.” In that case, Madison cautioned, the “essential characteristic of the government, as composed of limited and enumerated powers, would be destroyed,” and Congress would bear “the guilt of usurpation.” We should not, he later wrote, “by arbitrary interpretations and insidious precedents . . . pervert the limited government of the Union, into a government of unlimited discretion, contrary to the will and subversive of the authority of the people.” (Myron Magnet, “The Great Little Madison,” City Journal, Spring 2011)

As for the Necessary and Proper Clause:

…[M]ost federal regulations today are justified by the Necessary and Proper Clause. They are said to be within Congress’s Interstate Commerce Power— but within not the core Commerce Clause (“The Congress shall have Power . . . To regulate Commerce . . . among the several States”). Rather, they are said to be supported by the accompanying authority to “make all Laws which shall be necessary and proper for carrying into Execution” the power to regulate commerce.

Now, here’s the irony of the situation: Far from granting “broad authority” to Congress, the truth is that Necessary and Proper Clause grants no power at all. It is placed at the end of Article I, Section 8 as an explanation—that is, a “recital.” A recital is a passage in a legal document that has no substantive legal effect, but serves to inform the reader of assumptions or facts behind the document. Another example of a recital in the Constitution is the Preamble.

In recent years, several constitutional scholars have investigated the true meaning of the Clause, and have worked to correct the record. The process began with an article written by Professor Gary L. Lawson and Patricia B. Granger: The Proper Scope of Federal Power: A Jurisdictional Interpretation of the Sweeping Clause, 43 Duke L. J. 267 (1994). It focused on the meaning of “proper.” A decade later, I delved into the historical record. I found that wording of this kind was extremely common in eighteenth-century documents granting power from one person to another. I also found the courts had issued cases interpreting this language, and that the Founders had adopted the courts’ interpretation. See articles here and here.

Finally, Professors Lawson and I teamed up with two other noted scholars, Geoff Miller, and Guy Seidman, and wrote a book on the subject. (We all have differing political views, by the way.) The book is called The Origins of the Necessary and Proper Clause, and it was published last year by Cambridge University Press.

Here’s what we found:

* The Clause is a mere recital. It informs the reader how to interpret congressional authority. It does not grant any power.

* The term “necessary” tells the reader that congressional authority is interpreted according to the intent behind the document, rather than very strictly (as the Articles of Confederation required).

* The Clause does this by telling the reader that the legal “doctrine of incidental powers” applies to the Constitution. This means that Congress can regulate certain activities outside the strict reading of its powers, but ONLY IF this ancillary regulation is (1) subordinate to an express power, and (2) a customary or necessary way of carrying out the express power. For example, in regulating commerce, Congress can require accurate labels on goods to be shipped in interstate commerce. But Congress cannot regulate the entire manufacturing process.

* The word “proper” means that a law must comply with Congress’s fiduciary (public trust) responsibilities. A law is not “proper”—and is therefore unconstitutional— if it invidiously discriminates among people, violates individual rights, is utterly irrational, or exceeds congressional authority.

* Contrary to prevailing legal mythology, Chief Justice Marshall’s famous case of McCulloch v. Maryland (1819) did not stretch the Clause, but applied it properly and with due regard for its limitations.

Recently, Dave Kopel, the Independence Institute Research Director, filed an amicus curiae brief in the most important anti-Obamacare lawsuit. He did so on behalf of Professors Lawson, Seidman, and me. The goal? To correct the record and inform the courts what the Necessary and Proper Clause REALLY means. (Rob Natelson, “The Constitution: Does the Necessary and Proper Clause Grant “Broad Authority” to Congress? Actually, None at All,” posted May 18, 2011, at The Cauldron: By Caldara, the blog of the president of the Independence Institute)

Which brings us full circle to the opening quotation.

Related posts:
Unintended Irony from a Few Framers
Freedom of Contract and the Rise of Judicial Tyranny
Social Security Is Unconstitutional
The Constitution in Exile
What Is the Living Constitution?
Blame It on the Commerce Clause
The Slippery Slope of Constitutional Revisionism
The Real Constitution and Civil Disobedience
The Constitution: Original Meaning, Corruption, and Restoration
The Unconstitutionality of the Individual Mandate
Does the Power to Tax Give Congress Unlimited Power?
Does Congress Have the Power to Regulate Inactivity?

Miss Brooks’s “Grand Bargain”

The idiot known as David Brooks — The New York Times‘s idea of a conservative — is true to form today:

Imagine you’re a member of Congress. You have your own preferred way to reduce debt. If you’re a Democrat, it probably involves protecting Medicare and raising taxes. If you’re a Republican, it probably involves cutting spending, reforming Medicare and keeping taxes low.

Your plan is going nowhere. There just aren’t the votes. Meanwhile, the debt ceiling is fast approaching and a national catastrophe could be just weeks away.

At the last minute, two bipartisan approaches heave into view. In the Senate, the “Gang of Six” produces one Grand Bargain. Meanwhile, President Obama and John Boehner, the House speaker, have been quietly working on another. They suddenly seem close to a deal.

There’s a lot you don’t know about these two Grand Bargains….

You are being asked to support a foggy approach, not a specific plan. You are being asked to do this even though you have no faith in the other party and limited faith in the leadership of your own. You are being asked to risk your political life for an approach that bears little resemblance to what you would ideally prefer.

Do you do this? I think you do….

You do it because while the Grand Bargains won’t solve most of our fiscal problems. They will produce some incremental progress. We won’t fundamentally address the debt until we control health care inflation….

Both Grand Bargains produce real fiscal progress. They aim for $3 trillion or $4 trillion in debt reduction. Boehner and Obama have talked about raising the Medicare eligibility age and reducing Social Security benefit increases. The White House is offering big cuts in exchange for some revenue increases, or small cuts in exchange for few or none. The Gang of Six has a less-compelling blend of cuts, but it would repeal the Class Act, a health care Ponzi scheme. It would force committees across Congress to cut spending, and it would introduce an enforcement mechanism if they don’t. Sure there’s chicanery, but compared with any recent real-life budget, from Republican or Democratic administrations, these approaches are models of fiscal rectitude.

You do it because both bargains would boost growth. The tax code really is a travesty and a drag on the country’s economic dynamism. Any serious effort to simplify the code, strip out tax expenditures and reduce rates would have significant positive effects — even if it raised some tax revenues along the way….

In other words, Republicans should simply give in, on Miss Brooks’s say-so.

But Miss Brooks doesn’t know what he’s talking about.

First, with respect to “health care inflation,” government is the problem, not the solution. There are two key reasons for rising health-care prices, aside from innovation that yields expensive but effective drugs, procedures, and equipment. They are (a) the tax break that enables employers to subsidize employees’ health plans and (b) the subsidization of old folks’ health care via Medicare and (indirectly) SS. Those two interventions result in the overuse of health-care products and services. (There’s a 25-year old but still valid RAND study on the subject.) A far better system — if one insists on government involvement — would be to provide means-tested vouchers that can be redeemed for a  limited menu of vital medical products and services (e.g., critical surgeries, cardiovascular medications, chemotherapy). That’s it — no more Medicare, Medicaid, or their expansion via Obamacare.

Second, with respect to “tax expenditures” — there ain’t no such thing. Any action that results in higher taxes is a tax increase, no matter what Miss Brooks and his fellow Democrats choose to call it. And tax increases are growth inhibitors, not growth stimulators.

So much for the wisdom of The New York Times‘s pet “conservative.”

Related posts:
The Laffer Curve, “Fiscal Responsibility,” and Economic Growth
Our Miss Brooks
Rationing and Health Care
The Perils of Nannyism: The Case of Obamacare
More about the Perils of Obamacare
Health-Care Reform: The Short of It
Toward a Risk-Free Economy
Undermining the Free Society
The Constitution: Original Meaning, Corruption, and Restoration
The Unconstitutionality of the Individual Mandate
Does the Power to Tax Give Congress Unlimited Power?
Does Congress Have the Power to Regulate Inactivity?
“Tax Expenditures” Are Not Expenditures
My Negotiating Position on the Federal Debt

The Continuing Resurgence of Obamacare

In October I noted a sharp turnaround in likely voters’ views of Obamacare, namely, that is had become markedly less unpopular. Why? I called it bribery (and still do):

Millions of $250 checks have been sent to Medicare beneficiaries in recent weeks — and more will be sent in the four weeks remaining until election day.

There’s more to the bribery than $250 checks. Here are excerpts of the letter that accompanies the checks:

The Affordable Care Act, a new law passed by Congress and signed by President Obama on March 30, 2010, provides a one-time rebate to help with your drug cots. The rebate is sent automatically to most people enrolled in Medicare Part D who reach the Medicare drug plans coverage gap (“doughnut hole”) in 2010….

As part of this new law, starting next year, you will get a 50% discount on covered brand name drugs if you reach the coverage gap. On top of this, Medicare will add even more savings over the next several years until the coverage gap is closed by 2020.

The Affordable Care Act has many other provisions that protect and strengthen your Medicare, reduce your costs, and give you and your familymore control over health care….

It’s the old “something for nothing” trick. In this case, millions of old folks are getting something for nothing, while millions of younger folks will be getting nothing for something — their tax dollars. But the tax bill hasn’t come due yet because the federal government is still able to borrow money from abroad. And so, most of the people have been fooled — for the time being. By the time they understand what’s happening, it will be too late for them to do anything about it.

What has happened since October? Bribery still pays. Obamacare, though still unpopular on balance, has been gaining adherents a bit at a time:


Derived from this article and its predecessors at Rasmussen Reports. Poll results before passage of Obamacare represent strong approval minus strong disapproval. Poll results after passage of Obamacare represent strong approval of repeal minus strong disapproval of repeal.

The steep decline early in 2010 reflects “fashionable” pre-enactment resistance to Obamacare among independents, many of whom quickly changed their mind and became “fashionable” supporters of the fait accompli.

The polynomial fit (curved line) simply highlights the trend to date, and does not necessarily indicate Obamacare’s future popularity. But … if the upward movement continues, Republicans will find it hard going to repeal Obamacare, even if they win the Senate and White House in November 2012.

The present budget crisis could lead to a paring back of Obamacare. But if the crisis is resolved decisively, Obama (if not Democrats generally) will get much of the credit, and it will be more difficult to unseat him — unless job creation and economic growth remain in low gear.

Uncertainty abounds, as always.