Replacing Obamacare with a Means-Tested Tax Credit

In his first joint address to Congress, President Trump promoted the idea of a tax credit to support people’s purchase of health insurance. This is in line with the approach taken by Health and Human Services Secretary Tom Price, when he was in Congress, and by the House Republican leadership.

Some self-styled conservatives, however, oppose a refundable tax credit because it would cost taxpayers a lot of money. That which we currently understand to be the Republican replacement bill would offer a tax credit to individuals based on age but not on income, if they do not get employer-based health benefits.

That may be changing to a means-tested tax credit in order to win the support of conservative Republican lawmakers. “Oh, the irony,” exclaims one journalist: Don’t those Republicans know Obamacare contains means-tested tax credits? It’s still Obamacare-Lite!

No, it would not be.

Politics without Romance? Yes and No

James Buchanan, a pioneer in the development of public choice, viewed his approach to the study of government and politics as the analysis of “politics without romance.” But Jim couldn’t really live without the romance, and no sooner had he expelled it out the front door than he let it in the back door, calling it “constitutional political economy” and supposing that “constitutional level” politics, related to the most basic rules for collective decision making, could be separated from and made more durable than the “rent-seeking” decision-making related to ordinary politics.

My understanding of political history led me to conclude that Jim was engaged in wishful thinking in the “constitutional political economy” phase of his project. In my view, constitutional issues are as constantly and as hotly contested as the issues of ordinary politics—politics is politics, and political actors seize every instrument available for attaining their ends.

Yes, one can adopt a constitution that makes its amendment difficult, but that very feature explains why, from the outset, political actors in the United States of America usually undertook to amend the U.S. Constitution not by explicit, formal amendment in accordance with the stipulations expressed in the original document, but by judicial reinterpretation of legal and constitutional meanings. Judges that make law, as opposed to merely interpreting it, are not, as many conservatives imagine, a relatively recent occurrence for which Progressives or New Dealers are to blame. Such judicial law making goes back at least to the Marshall court of more than 200 years ago, and conservative justices practice it as well as progressive ones.

Notice how, today, appointments to the Supreme Court elicit such fierce politicking. (Indeed, this heated wrangling has been the case for a long time.) Such would not be the case if there were no judicial law making. All sides expect it, however, and act accordingly.

Charles Murray and Middlebury College

The Atlantic, not a place to find conservative or libertarian views, has a good essay from a self-proclaimed liberal on the events at Middlebury College.  Just as a recap, a student group at Middlebury College invited Dr. Charles Murray to speak on his book Coming Apart: The State of White America, 1960-2010.  Also invited to this event was Allison Stanger,  a progressive professor at the college, to engage Murray in a public conversation following his talk.  But no talk or conversation was allowed to take place.  Instead, students shouted Murray down and then launched an attack.  Here is how The Atlantic summarizes the events:

[Murray and Stanger] found themselves surrounded by protesters. The protesters—some of whom were wearing masks and may not have been Middlebury students—began pushing them. When Stanger tried to shield Murray, according a Middlebury spokesman, a protester grabbed her hair and twisted her neck.

Murray, Stanger and their escorts made it to a waiting car, but the protesters “pounded on it, rocked it back and forth, and jumped onto the hood. . . . One took a large traffic sign, attached to a concrete base, and placed it in front of the car to prevent it from leaving.

Finally, Murray and Stanger got away. They had planned to eat dinner at a local restaurant, but, upon learning that the protesters planned to disrupt their meal, left town altogether. Stanger later went to the hospital, where she received a neck brace.

Unbelievable.  A liberal professor defending the idea of debate and speech is injured by a crowd of student radicals when she tried to shield a conservative writer from physical attack.  What will be of our country in 10 or 20 years when these young “social justice warriors” start to take positions of authority in government and business?  They fear discussing ideas and resort to violence when someone disagrees with them.  They have a sense of entitlement that they are the only proper judges of which opinions are acceptable and which may be voiced.  What awaits us??

Review: Logan Shows Superhero Films Can Also Have Soul

Logan is the kind of movie that restores my faith in superhero action films. The story is layered, the characters have defined arcs, and the suspense keeps the audience engaged. Its R rating is well earned, with gruesome violence and disturbing situations involving children. The Hunger Games looks like a playground dust-up compared to what the mutant children in Logan deal with—and respond to in kind.

The violence may seem gratuitous to some viewers, but mostly it serves the purpose of the story. James “Logan” Howlett is the mutant Wolverine of Marvel Comics fame, and his personality is volatile and emotional. He also has a conscience. These dimensions—including the guilt that comes with the curse of having steel claws that decapitate, impale, and slash his attackers—are portrayed well by Hugh Jackman (his ninth movie performance as Wolverine). Logan’s mutant powers are used defensively, not offensively. The violence is not portrayed as honorable or noble, and this becomes an integral part of a very thoughtful film.

The story picks up on the tail end of a purge of mutants in a somewhat dystopian America of 2029. Logan is holed up in an abandoned factory, just over Texas’s border with Mexico, caring for Charles Xavier, a.k.a. “Professor X” (Patrick Stewart, Star Trek: The Next Generation), and assisted by the albino mutant Caliban (Stephen Merchant). Both Logan and Xavier are dying. Logan has been poisoned by the adamantium alloy fused into his bones to make his claws. Professor X is suffering from a degenerative neurological disease that unpredictably unleashes devastating telepathic powers.

Meanwhile, the evil global corporation Transigen is tracking down all the remaining mutants and replacing them with the new X-24 breed cloned from the DNA of first-generation mutants. The program is run by Transigen’s brilliant if authority-hungry surgical head Zander Rice (Richard E. Grant, Bram Stoker’s DraculaThe Iron LadyJackie), whose father was killed by Logan at the end of X-Men: Apocalypse. Assisting Rice are the “cyber-enhanced” (non-mutant human) chief of security Donald Pierce (Boyd Holbrook, Milk, Gone Girl) and a small army of cyber-enhanced “enforcers” called “reavers.”

Xavier, Logan, and Caliban live below the radar until Gabriella (Elizabeth Rodriguez, Orange is the New BlackFear the Walking Dead), a former nurse for Transigen, tracks them down in an effort to save 11-year-old Laura (Dafne Keen, The Refugees), part of a new generation of X-23 warriors cloned from mutant DNA. Gabriella implores Logan to transport Laura to safety in Canada. Transigen, having determined that the X-23 children were too hard to control, had killed them after another breed of mutant, the X-24, was perfected. Gabriella sees the humanity in the children and helps several to escape, but Laura is the only one who makes it to Logan’s compound. Gabriella also reveals that Laura was cloned from the DNA of Logan and thus is his daughter.

In the hands of a lesser filmmaker, the father-daughter twist could easily have been nothing more than a cinematic cliché. But in the hands of writer-director James Mangold (Walk the LineGirl, Interrupted, 3:10 to Yuma) the revelation becomes central to the film’s psychological theme: how violence affects the human mind. Logan’s relationship with Laura rekindles a fundamental humanity in him. The real story, however, is his role in teaching the undisciplined, intense, and volatile Laura the value of preserving life rather than taking it. Logan’s internal torment is driven by his guilt from having killed people, not all of whom were evil. Teaching warrior Laura a moral lesson—the dangers and responsibilities that come with her mutant powers—provides Logan with a path to redemption as he grapples with his own impending death.

As his healing powers weaken and his life grows increasingly precarious, Logan experiences his humanity resurfacing long enough for him to awkwardly but effectively teach Laura the value of life. Dafne Keen’s portrayal of Laura is riveting and compelling. The young actress convincingly shows us how Laura evolves, from a darkly unstable and violent warrior into an inquisitive and contemplative child who has genuinely bonded with Logan. Mangold deftly uses Laura’s Spanish-English bilingualism to pull back the layers of her character and eventually reveal her complexity and compassion.

Through Logan’s torturous self-loathing from having blood on his claws, the film shows how violence traps and degrades humanity. But it also imparts a hopeful vision, by showing Laura’s growing understanding of the value of human life and connection to her father. This message is not just one of many interpretations of the events unfolding on the screen—it is unavoidable. As the mutant children make their way to Canada, Laura quotes the 1953 western movie Shane. “A man has to be what he is, Joey,” says Shane to the young boy who idolizes the gunslinger turned protector.

“You can’t break the mould… I tried it and it didn’t work for me….  Joey, there’s no living with a killing. There’s no going back from one. Right or wrong, it’s a brand. A brand sticks. There’s no going back. Now you run on home to your mother, and tell her…tell her everything’s all right and there aren’t any more guns in the valley.”

Logan is a superhero action film with soul. It provides entertaining escape, but it also provokes meditations for viewers hoping for more depth.

Why Do Late Middle-Aged Women Allow Obamacare to Gouge Them?

In February, Professor Mark Pauly of the Wharton Business School wrote a short article proposing reforms to individual health insurance, in which he reminded us the biggest premium hike in the market for individual insurance consequent to Obamacare was among women in their 60s. His actual research was published in 2014, but I have wondered about it ever since.

Obamacare prevents insurers from charging premiums for 64-year olds that are more than three times those charged to 18-year olds. (A multiple of about five would be fairer, according to actuaries’ consensus.) Intuition tells us that should reduce premiums for older people. That intuition is wrong. Nevertheless, if politicians can convince people it is true, it makes political sense to impose the rule, because older people are much more likely to vote than younger people.

However, Obamacare also prevents insurers from charging different premiums to men and women of the same age. Pro-Obamacare politicians have a provocative slogan: “Being a woman should not be a pre-existing condition.”

Because Obamacare mandates maternity benefits, women of childbearing age cost a lot more than men. So the rule hikes young men’s premiums. Because men in late middle age have “bad habits” (according to Pauly), their health care costs more than older women’s health care does. So, it hikes those women’s premiums.

Politically, this is hard to figure out. Pre-election polling indicated 69 percent of women aged 18 to 34 supported Hillary Clinton, but only 60 percent of women aged 50 to 64 did. That alone suggests Democratic (therefore pro-Obamacare) politicians would seek younger women’s support by imposing a rule that favors them but punishes older women.

But does this overwhelm voter turnout? In the 2012 election, only 44.5 percent of women aged 18 to 24 voted, while 69.5 percent of those aged 45 to 64 voted. So, in raw numbers, there are surely more late middle-aged women who vote Democrat than young women.

Employer-Based Coverage Does Not Equalize Access to Health Care

One reason public policy favors employer-based health benefits instead of individually owned health insurance is that policymakers believe it equalizes access to health care among workers of all income levels. Insurers usually demand 75 percent of workers be covered, which leads to benefit design that attracts almost all workers to be covered.

Employers do this by charging the same premium for all workers but having workers pay only a small share of the premium through payroll deductions. Most coverage is paid by the firm. Last year, the average total premium for a single worker in an employer-based plan was $6,435, but the worker paid only $1,129 directly while the employer paid $5,306.

Although this suppresses workers’ wages, workers cannot go to their employers and demand money instead of the employers’ share of premium. The tax code also encourages this practice, by exempting employer-based benefits from taxable income.

Does this equalize access to care? No, according to new research:

When demographics and other characteristics were controlled for, employees in the lowest-wage group had half the usage of preventive care (19 percent versus 38 percent), nearly twice the hospital admission rate (31 individuals per 1,000 versus 17 per 1,000), more than four times the rate of avoidable admissions (4.3 individuals per 1,000 versus 0.9 per 1,000), and more than three times the rate of emergency department visits (370 individuals per 1,000 versus 120 per 1,000) relative to top-wage-group earners.

(Bruce W. Sherman, et al., “Health Care Use and Spending Patterns Vary by Wage Level in Employer-Sponsored Plans,” Health Affairs, vol. 26, no. 2 (February 2017): 250-257.)

The reasons for these differences are not fully explained. Nevertheless, this research suggests employer-based benefits are not a good equalizer of access to health care, and the tax code’s prejudice in favor of those benefits and against individual health insurance should be revisited.

* * *

For the pivotal alternative to Obamacare, see Priceless: Curing the Healthcare Crisis and A Better Choice: Healthcare Solutions for America, by John C. Goodman, published by Independent Institute.

Why Health Coverage Does Not Equal Healthcare Access

Readers know I disagree with using measurements of “coverage” as measurements of access to health care. New data from the Louisiana Department of Health, which cheers the expansion of Medicaid dependency in the state, shows (unwittingly) exactly why.

Healthy Louisiana’s Dashboard shows that 402,557 adults became dependent on Medicaid as a result of Obamacare’s expansion. The Department notes benefits for some sick people. For example, screening resulted in 74 people being diagnosed with breast cancer and 64 diagnosed with colon cancer.

The Dashboard stops there, not telling us how those newly diagnosed were treated. (Medicaid patients often receive treatment later than privately insured.)

However, there is another, likely bigger problem. Of these almost half million newly dependent, only 62,742 received “preventive healthcare or new patient services.” As David Anderson of the Duke-Margolis explained to me on Twitter, this number excludes those who became dependent on Medicaid but who were already being treated or did not get any treatment. That is, the Medicaid enrollment resulted in zero change in access to health care for 339,815 of the newly dependent. That amounts to 84 percent of the population.

Why did these people enroll in Medicaid when they were already receiving care or did not want to receive care? Well, the Medicaid expansion involved a lot of promotion, including enrollment “fairs” in high-traffic areas, so why not sign up and get a balloon or lapel pin or whatever?

More seriously: Those receiving care either paid for it or received it as charity. If they paid for it themselves, we need better understanding of whether or not this drove them into financial distress. If they received charity care, taxpayer funding is unnecessary.

Of course, most of the privately insured population at any given time is healthy. However, they are paying for “insurance” and cannot just get it whenever they want. People who get Medicaid do not need to enroll in open season: They can sign up when they get sick.

So, measuring health reform’s success by the number of people covered by Medicaid expansion is a very, very poor way to estimate increased access to health care.

* * *

For the pivotal alternative to Obamacare, see Priceless: Curing the Healthcare Crisis and A Better Choice: Healthcare Solutions for America, by John C. Goodman, published by Independent Institute.

Resist!

I’m somewhat amused by the anti-Trump protests the nation has seen since Trump’s election.  He’s been a big talker, but as far as actually doing things, so far the only substantial thing he’s done was to try to implement his immigration ban.  While I understand why people oppose his immigration policies, for the most part they are protesting Trump, personally, and the things he’s said rather than what he’s done in his young presidency.

I’m not against the protests.  I have a lot of sympathy for anyone who protests against the use of government power by the executive branch (and the other two branches as well, for that matter).  Regardless of whether I support or oppose any particular policy views Trump has espoused, any pushback against government power is always a move in the right direction.

Over the last century we’ve seen continual growth in the power of the executive branch, which at one time or another everyone has thought was undesirable.  Progressives liked it when Obama was president; they dislike the power the chief executive holds now.

The on-going threat is that when government power expands, someone is going to gain control of that power to use it for purposes we oppose.  So regardless of whether we support or oppose the specific person who holds that power now, our long-run interest is always to oppose any expansion of that power.

These protesters overwhelmingly come from the political left—the supporters of big government.  It’s even better when those who have traditionally supported big government protest against the government’s exercise of power.

I’m on board with the Trump protesters, not because they are resisting Trump specifically, but because they are resisting the power of the executive branch of government.

The USA—Best Not to Go There Unless You Have an Urgent Reason to Do So

I am a consistent defender of allowing free passage of peaceful people across national borders. I understand full well why someone from an impoverished Mexican village or a violent hellhole such as Tegucigalpa might wish to migrate to the USA, where wage rates are 5-10 times greater for unskilled labor and, for Hondurans, Salvadorans, Guatemalans, and many people from the Middle East, physical security is better.

However, if you are not in such desperate straits, I would strongly suggest that you avoid attempting to enter the USA, however legally you might try to do so. Those entering the country through government checkpoints, either at the border or at an airport, run a high risk of being treated with great contempt by the border thugs and are at considerable risk of worse, including not only being detained and interrogated at great length (and completely without a plausible basis) and being compelled to surrender computer, phone, and social media passwords along with the devices, but also being denied permission to enter and forced to return to their place of departure.

The USA is simply not a welcoming place. It is a police state, and a hostile one at that. It makes virtually no attempt to distinguish potentially threatening people from ordinary people who, to anyone with a trace of brain, obviously pose no threat to national security or the personal well-being of current U.S. residents. So, be smart, amigos: don’t go there unless your have a very important reason to do so.

I am now kicking myself for having agreed to attend a conference in Maui in April. I should have listened to my wiser angel. I doubt very much, however, that afterward I shall ever make the same mistake.

The State, No Friend of Harmony and Peace

Turmoil and conflict

Politics nourishes them

Nature of the beast

Private property

Free markets and firm contracts

Foster harmony

Human rights basic

State thrives on war and plunder

Freedom works better

  • Catalyst
  • Beyond Homeless
  • MyGovCost.org
  • FDAReview.org
  • OnPower.org
  • elindependent.org