Nothing in the world can take the place of persistence.
Talent will not; nothing is more common than unsuccessful men with talent.
Genius will not; unrewarded genius is almost a proverb.
Education will not; the world is full of educated derelicts.
Persistence and determination alone are omnipotent.
Calvin Coolidge
Out of the Mouths of Babes...
Obama seems to be in an oddly obsessive competition with George W. Bush; it took Bush 8 years to almost double the national debt; it took Obama less than 4 years to double the public-held debt. At this point of the 2004 campaign, Bush had 79 fundraisers; Obama has had 160.
The President tells a joke (from IBD, my edits):
This young couple was at a campaign event with their adorable four-year-old son and pointed at a picture of the President. "They said, 'Sammy, who’s that?' And he said, 'That's Barack Obama.' 'And what does Barack Obama do?' And the boy thinks for a second and he says, 'He approves this message.'"If only Obama spent as much time and effort exercising leadership as he does working on his reelection, his fundraisers, his vacations, his golf games, his polarizing boring speeches, etc....
I Don't Claim Credit But....
I independently coined a term for the Democratic Financial Reform Law, i.e., Dodd N. Frankenstein, which I have repeatedly used for several months now. I realize that with 2319 pages of regulations and a Congressman named Barney Frank, it doesn't require that much imagination to come up with 'Frankenstein', but the first time I ever heard another party use a similar term was IBD on a recent podcast: Dodd-Frankenstein Strangling Economy On Second Anniversary.
A Pet Peeve: Disingenuous Progressive Rhetoric,
The Freeloader/Free Rider and Mandatory Insurance
Okay, I'm officially annoyed. Democrats, who in general tend to be grossly incompetent on matters of business and economics, have gleefully drafted off Romney's defending tax/penalties for insurance mandates as a strategy for dealing with freeloaders/free riders and thus reinforcing individual responsibility.
Romney and Gingrich trace their support for the mandate concept to a 1989 Heritage Foundation piece. (The Heritage Foundation is a conservative think-tank which I have often referenced during the history of the blog.) The Heritage Foundation had advocated a mandate in crafting a market-based alternative to Democratic attempts to nationalize health care.
[Heritage has responded to opportunistic (unprincipled) attacks by progressives in the wake of the emerging consensus against purchase mandates by saying, among other things, RomneyCare/ObamaCare differ significantly from their proposals (e.g., comprehensive vs. major medical (i.e., catastrophic)), the use of an incentive, not a penalty; etc.) and there have been developments in behavioral economics and risk adjustment over the past 2 decades.]
Why would a conservative organization suggest a mandate? Because of dysfunctional regulatory policies which effectively enable some policyholders to insure below their costs and restrict pricing/underwriting flexibility; these costs get passed along to other policyholders, including healthy people whom rarely use medical services. As price increases, demand shrinks (e.g., more profitable healthy policyholders elect to self-insure). The insurance business becomes a vicious circle of poorer risks and insurance companies can't cover their costs.
The insurance industry has a come-to-Jesus moment with a clueless, regulation-happy, "you're stuck with the unsustainable cost burden of our policies" progressive government:
"Look, your absurd regulatory policies make for an unsustainable business model. You have one of three options:"
- repeal the unsustainable, dysfunctional policies (e.g., community rating, guaranteed issue, comprehensive benefit mandates, etc.) [our preference]
- reimburse us directly for the additional costs of high risk policyholders
- reimburse us indirectly through your coercive powers, i.e., a purchase mandate requiring self-insuring individuals to purchase insurance above their own costs
That's why Milton Friedman (below) and other rational people, including myself, HAVE CALLED FOR REPEALING TAX EXPENDITURE POLICIES (i.e., TAX-EXEMPT BASIS) FOR HEALTH INSURANCE. Granting people tax exemptions for health care is sort of like giving everybody entering a race a blue ribbon: who do you think you're fooling? If everybody has a tax break, nobody has a tax break, because government has to make up the revenue elsewhere. While people have been focusing on the tax/penalty (i.e., Chief Justice Roberts' opinion), the fact is that people get charged either directly (e.g., the tax penalty) or indirectly (through above-cost insurance, probably with after-tax dollars)
I point this out because:
- from an equal protection basis, the self-insured are entitled to their fair share of government subsidies.
- it's patently absurd to scapegoat the (before RomneyCare) 7% (Massachusetts) - 16% of the population uninsured for the health care cost bubble. Catastrophic health conditions are spread across the population.
- a considerable portion of the uninsured are eligible for existing government programs (e.g., Medicaid) and/or are low-risk young adults whom rarely use medical services and if and when they do, pay them out of pocket.
- self-insured people do assume some of the relevant system costs (including makeup costs for government program participants) through out-of-pocket transactions for medical services, just like every customer of a retail store indirectly shares some of the costs of merchandise theft, etc.
It's not a tax on the American people -- a tax, it's a penalty for free riders. Those who want to be free riders have to pay their -- they either have to take responsibility and buy insurance, and there are many ways for them to do it, or they get, they get a penalty. And the penalty, yes, it is charged under the tax code. The penalty is on people who have the wherewithal but refuse to buy health insurance, figuring they won't be sick and if they do, other people will have to cover it. So these free riders, as they were identified by Governor Romney himself, he said people have the ability to pay and don't -- can't expect to be free riders. And I think that he termed it exactly right. These free riders make health insurance for those who are taking responsibility, making it more expensive. Personal responsibility is a principle of our country.Oh, yeah: the Democratic Party, responsible for up to 2 years of morally hazardous generous unemployment payments, welfare transfer payments, food stamps, public housing, low/no collateral for home mortgage loans, and 1001 other government freebies, is all about individual responsibility. So let us summarize here:
- the Democrats, whose Medicare/Medicaid program payments are generally below market costs and subsidized by private-sector plans, are talking about "freeloaders"
- the Democrats subsidize those whom are covered under employer or government plans at the expense of other taxpayers, and yet they have the audacity to talk about "freeloaders"
- the Democrats exacerbate costs through third party systems, competition-killing regulation, gold-plated benefit mandates (each creating their own set of freeloaders) and pass along their costs to captive taxpayers having to pay for their own medical costs out of after-tax money: these are "freeloaders"?
- the Democrats have an income tax system where half the workers do not pay a single penny towards ordinary government expenses. Not a dime for national defense or any other operational government service--but these aren't "freeloaders"?
Romney wants credit for fashioning a popular bipartisan achievement, which he can rightly contrast to the highly unpopular ObamaCare law which passed without a single Republican vote; he rightfully deserves kudos for basically driving a market-based alternative, certainly not a Democratic plan. From a standpoint of political strategy, it was a brilliant masterstroke.
I am highly amused by Democrats, without a single, creative thought on their own, deciding to imitate, on the surface level, a more statist alternative to RomneyCare, think that they have boxed in Romney. If I was Mitt Romney, I would say something to effect: "The Democrats like to talk about RomneyCare. Well, I know RomneyCare well: I was in my office alone when it came to designing RomneyCare, and I got RomneyCare passed. And I can tell you this: ObamaCare is NOT RomneyCare. Why should voters reelect a man whom wants to be like Romney, when they can elect the REAL Mitt Romney instead?"
But let's be clear: RomneyCare is not a panacea. Massachusetts has among the highest health insurance policy costs in the country. It's harder to find doctors. Costs have blown past projections; Governor Patrick has resorted to various schemes (like denying eligibility to new immigrants) to cut down costs.
In my view, RomneyCare is a failure because it fails to address the real issues: it distorts the free market in health care by perpetuating unsustainable regulations and benefit mandates. All RomneyCare and ObamaCare do is advance in a more stealth fashion a statist government takeover of the sector. The real solution is to restore the free market to the health care sector. Romney failed to do that, but I do not underestimate the difficulties of implementing legitimate free market reforms in progressive groupthink states like Massachusetts.
This week, given Milton Friedman's centennial birthday, I hadn't seen a piece that he wrote for the Hoover Institution back in 2001 on How to Cure Health Care until now, but he raises some of the same issues I've repeatedly mentioned: policyholders not vested in purchase decisions (third party), government subsidies through pretax basis, ordinary vs. risk-based expenses, catastrophic (not comprehensive or what I call "gold-plated" insurance):
We generally rely on insurance to protect us against events that are highly unlikely to occur but that involve large losses if they do occur—major catastrophes, not minor, regularly recurring expenses. We insure our houses against loss from fire, not against the cost of having to cut the lawn. We insure our cars against liability to others or major damage, not against having to pay for gasoline. Yet in medicine, it has become common to rely on insurance to pay for regular medical examinations and often for prescriptions.
A cure requires reversing course, reprivatizing medical care by eliminating most third-party payment, and restoring the role of insurance to providing protection against major medical catastrophes. The ideal way to do that would be to reverse past actions: repeal the tax exemption of employer-provided medical care; terminate Medicare and Medicaid; deregulate most insurance; and restrict the role of the government, preferably state and local rather than federal, to financing care for the hard cases.Be still, my beating heart. If a woman I dated said such things... I've been REPEATEDLY saying the same things independently of Friedman or others.
Interesting Pro-Romney Blog Comparison
of ObamaCare / Romney Care
NB: This blog OPPOSES both RomneyCare and ObamaCare.
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| Courtesy of Virginia Virtucon |
The Four Seasons, "Big Girls Don't Cry"
