Halbig versus Burwell is the famous lawsuit that claims that Obamacare federal health-insurance exchanges cannot pay tax credits to health insurers. The plain language of the law is that only state-based Obamacare health-insurance exchanges can channel these tax credits. The real champions of this argument are Michael Cannon and Jonathan Adler of the Cato Institute, who recently encapsulated their argument in the Wall Street Journal.

The question is still unsettled. Last week, two different Circuit Appeals Court panels came to different conclusions: The DC Circuit agreed that the subsidies could go only to insurers in state exchanges; while the 4th Circuit ruled that they could go through federal exchanges too.

The Obama administration is horrified that the Supreme Court could decide that it is illegal to subsidize insurers in federal exchanges. Most states have declined to set up their own exchanges. Further, some of those that did are closing up shop.

So, imagine the surprise when a researcher at the Competitive Enterprise Institute dug up a 2012 video of Jonathan Gruber, who earned about $400,000 from taxpayers as the “architect” of Obamacare, stating the obvious:

“What’s important to remember politically about this is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits…”

Of course, Mr. Gruber is now trying to wriggle out of his previous comments. Read the whole story at the CEI blog.

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For the pivotal alternative to Obamacare, please see the Independent Institute’s widely acclaimed book: Priceless: Curing the Healthcare Crisis, by John C. Goodman.

One hundred years ago today, Austria-Hungary fired the first shots of World War I, sparking its conflict with Serbia. Gavrilo Princip, a Bosnian Serb, had assassinated Archduke Franz Ferdinand. Mutual defense agreements ensured that the political clash did not remain regional. Austria-Hungary got support from Germany, the Ottoman Empire, and Bulgaria. Serbia found allies in Britain, France, Belgium, Greece, Romania, Italy, Russia, Portugal, Montenegro, Japan, Brazil and the United States. The global war likely qualified as the worst bloodbath the world had yet to see, certainly in such a short duration. Fifteen million or more died in less than five years. Tens of millions were wounded, displaced, or orphaned. Disease spread. The international trade and exchange that existed before the war never fully recovered.

World War I was a low point for liberties within the United States, once America finally got engaged in the battle. People went to prison for criticizing the military or opposing the draft. Surveillance of the citizenry and crackdowns on dissent became normal. Domestic regulation and taxation skyrocketed. Almost nothing that happened during the New Deal did not have some precursor in Wilson’s wartime domestic governance. There was hope for the United States becoming freer and freer in the early 20th century. World War I altered that picture dramatically. Almost everything the federal government has done in the last century has roots in the 1910s.

“Barbarians at the gate.” That’s what Arizona Superintendent of Public Instruction John Huppenthal called opponents of Common Core national standards several weeks ago. His remarks are symptomatic of just how far elected officials within and outside Arizona have strayed from our Constitution, which doesn’t even contain the word “education.”

Supporters claim Common Core will provide a consistent, clear understanding of what students should know to be prepared for college and their future careers. On the contrary, many experts serving on Common Core review committees warn that academic rigor was compromised for the sake of political buy-in from the various political interest groups involved—including teachers unions.

Unsurprisingly, the curriculum is being used to advance a partisan political agenda, showcasing one-sided labor union, ObamaCare, and global warming materials, along with more graphic, adult-themed books under the auspices of promoting diversity and toleration. But the politicization doesn’t stop there.

Secretary of State John Kerry was right to call Israel’s Operation Protective Edge against Hamas “a hell of a pinpoint operation” in an apparently private comment that had the hallmark of a diplomatic move aimed at putting pressure on Tel Aviv. Except that he was referring ironically to the military aspect of the operation, and it is the political aspect that truly expresses the “pinpoint” nature of what Israel is doing—without the irony.

Israeli Prime Minister Bibi Netanyahu’s precise target is the alliance between Fatah—led by Mahmud Abbas, the president of the Palestinian Authority—and Hamas, formed in April after seven years of conflict in the occupied territories. His strategy has always been to make unviable any Palestinian entity (let alone the possibility of sharing the same land with the Arabs under equality before the law). His tactics are at the service of that strategy. All he needs is to gain time until the “fait accompli” makes things irreversible. Operation Protective Edge serves that purpose.

Netanyahu knows three things work in his favor. The nature of Hamas, an organization that has engaged in terrorism, makes the atrocities arising from the land, air, and naval attacks easy to justify with the argument that the Palestinians use civilians as shields and that leaving their capability intact will expose Israelis to rockets. The tragic Jewish history confers impunity on Tel Aviv’s authorities: criticizing Israel can easily be construed as anti-Semitism. Finally, no U.S. administration can afford, domestically, to really distance itself from Tel Aviv.

Let’s remember how we got to Operation Protective Edge. In July 2013 the Obama administration launched a Middle East initiative and set a nine-month deadline for Israel and the Palestinians to reach an agreement. But the Israelis continued to expand the settlements (thousands of permits for new units were issued). When the deadline was near, Netanyahu reneged on his commitment to free hundreds of prisoners. He got the response he wanted from Abbas, who gave up and engaged in unilateral initiatives aimed at conveying the impression that the Palestinian Authority, which gained observer status at the UN in 2012, is a state in process. It was only a matter of time before an incident would trigger violence in Gaza, which houses not only Hamas but also a wing of the ruthless Islamic Jihad.

Imagine a pill that could cure cancer with one course of therapy or reverse an inherited, deadly disease. If it cost $1 million, could you access it?

This was the question asked at a recent panel discussion held by the American Enterprise Institute. The panel discussed a couple of new proposals to finance new medicines that come at a high price. Because these medicines address the needs of only a small number of patients, manufacturers contend that prices need to be high to make the investment worthwhile.

One proposal was put forward by Scott Gottlieb, MD, (of the American Enterprise Institute) and Tanisha Carino (of Avalere Health). They put forward a redefinition of spending on specialty drugs as capital investment rather than consumption spending. This is because, for example in the case of Sovaldi, the expensive upfront costs of the drug are more than paid for by dramatically reducing costs over the next twenty or thirty years for a patient who might otherwise require a liver transplant.

Medicaid “crowd-out” is the hypothesis that enrolling more people in Medicaid will cause some people to drop private coverage in favor of Medicaid. The rate of crowding out may reach 60 percent.

Now, courtesy of the Robert Wood Johnson Foundation (RWJF), we have evidence that the entire effect of Obamacare so far is to crowd out private coverage. RWJF’s new report (“First Observations Around the Affordable Care Act”) further confuses the consequences of Obamacare on coverage and access to care. This is not the RWJF’s fault: The emerging evidence on Obamacare is a jumble of contradictions. In this instance, the report insists that physicians saw no increase in patient demand after Obamacare, as demonstrated in Figure 2. More sophisticated metrics showed that the complexity of patients’ needs also did not increase after Obamacare.

However, there was a significant increase in Medicaid patients as a share of patients seen. In states that expanded Medicaid, this proportion increased by one-quarter, from 12.3 percent to 15.6 percent, and barely budged in states that did not expand Medicaid. Both of these findings contradict other evidence that Obamacare patients consume many more specialty drugs than non-Obamacare patients; and that many states that did not expand Medicaid also experienced a (smaller) increase in Medicaid dependency than states that expanded the program.

Nevertheless, if the RWJF report trumps this earlier evidence, we are left with an equally disturbing conclusion: Obamacare did not increase access to medical services at all, it merely replaced privately paying patients with taxpayer-funded patients. And need we remind you that at the beginning of June, almost three million Medicaid applications had not been processed?

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For the pivotal alternative to Obamacare, please see the Independent Institute’s widely acclaimed book: Priceless: Curing the Healthcare Crisis, by John C. Goodman.

Today, we received dueling circuit court decisions on Obamacare’s tax credit component. The D.C. Circuit held (2-1) that the tax credits do not apply to health insurance purchases through an exchange established by the federal government, whereas the Fourth Circuit held that they do. If the subsidies are not available for insurance purchased through exchanges established by the feds, then Obamacare could unravel. Because of this split in the circuits, this issue is almost guaranteed to be taken up by SCOTUS in the coming term.

Exchanges operate websites that allow individuals and employers to shop for and purchase approved health insurance. The president and Congress envisioned all the states scurrying to establish exchanges, but only 14 states and D.C. have done so. The Obamacare statute recognized that some states might not establish exchanges, and provided that the federal government could establish exchanges in states that refused to create an exchange for its citizens.

The individual mandate of Obamacare requires that folks purchase health insurance or suffer a monetary penalty. The penalty does not apply to individuals for whom the annual cost of coverage, less any tax credits, would exceed 8 percent of projected household income. If credits are unavailable in states with federally created exchanges, the number of people subject to penalties decreases dramatically — without the substantial tax credits, they fall into the exempted category because the costs of health insurance will exceed 8 percent of household income. If the individual mandate is gutted, then Obamacare suffers a major setback.

The statutory language provides that the tax credits are available only when purchasing a “qualified health plan” purchased through “an Exchange established by the State under [section] 1311” of the statute. There is no mention in the statute of tax credits applying to insurance purchased through federally established exchanges. Accordingly, the plain language dictates that tax credits do not apply in the federally established exchanges and thus millions of Americans will be exempt from the penalties of the individual mandate.

Unlike the D.C. Circuit, the Fourth Circuit avoided the clear language of the statute and held that the statute is “ambiguous” and thus allows for flexible agency interpretations about the applicability of the tax credits.

Chief Justice John Roberts worked hard to save Obamacare in the first go-round. It will be interesting to see if he chooses to yet again save Congress and the president via judicial legerdemain.

Following up on my nationally syndicated column on the pending re-authorization of the Export-Import Bank (“Let the Ex-Im Bank Fail”), the Financial Services Committee of the U.S. House of Representatives issued a press release on July 21, 2014, stating that

“Two of the four Russian firms targeted with new sanctions announced last week by the Obama administration have received more than $1 billion in U.S. taxpayer-financed subsidies from the Export-Import Bank.Vnesheconombank (VEB) and Gazprombank – two state-owned Russian banks – have together received more than $1 billion in Ex-Im financing since 2003.

“Here are the deal details: In 2003, Gazprombank received a five-year loan guarantee worth $22.6 million from Ex-Im. VEB alone has received over $1 billion in Ex-Im backed loan guarantees. This includes a $496 million loan guarantee in 2012 and a $703 million loan guarantee in 2014.

“The sanctions do not apply to these existing arrangements, ‘meaning Ex-Im is under no obligation to cancel previous deals it has with either company’, according to one report.”

So, in addition to financing the exports of Boeing, Merck, Caterpillar and other very large domestic corporations, which hardly need taxpayer subsidies to sell overseas, the Ex-Im Bank also is financing purchases of U.S. goods by buyers located in countries increasingly hostile to American interests.

Free and unfettered international trade is the path to peaceable relations with the rest of the world. (Can anyone think of a benefit from the longstanding embargo of Cuba that possibly offsets the harm suffered by U.S. cigar smokers?) But, the Ex-Im Bank should not be a subsidizer of Vladimir Putin’s Russian-centric geopolitical strategy to bring the Ukraine under his hegemony.

The Kremlin, it turns out, is funneling money to environmental activist groups in Europe to stop or delay the introduction of hydraulic fracturing (“fracking” is a U.S. technology) in order to keep Europeans dependent on Russian natural gas. In that respect, at least, the Ex-Im Bank and the KGB’s successors seem to be on the same page (see my column in Forbes here).

If a better reason exists for ending the crony capitalism of the Ex-Im Bank on or before the current fiscal year expires on September 30, I cannot think of one.

My hometown of Tallahassee, Florida, has recently shown an increased concern about gun violence.  Not only are Tallahasseans shooting each other, so far in 2014 the Tallahassee Police have shot four people, killing two.  A related concern is that people seem to have little trust in the police.

The concern has been manifested in a town meeting chaired by the police chief, who wants to earn the people’s trust, and a series of articles in the local newspaper.

Much of Tallahassee’s gun violence is in the poorer sections of town, where in many cases, people’s drugs of choice are illegal.  If your drug of choice is alcohol or nicotine or caffeine, government will tax it and protect your right to use it.  But if your drug of choice is marijuana or cocaine, not only will government not protect you or your property, it has declared war against you.

We call it a war on drugs, but it is actually a war on drug buyers and sellers.  The government seeks them out, and when it finds them, confiscates their property and sends them to prison.

If the government will not protect someone’s property, then the owners of that property will have to protect it themselves. That’s why they want guns.  If someone steals your drugs, government police and courts will work against you, rather than helping you recover your property.

Of course, not everyone in these violence-prone neighborhoods buys or sells drugs, but many will have friends and neighbors who do, and it stands to reason that people will not have much trust in groups their friends and neighbors view as adversaries.  And of course, they should view the police as adversaries, because the police are the front line in the war on drugs that has been openly declared against them.

This sets up a culture of violence, but why?  It is because our government has openly declared war against a significant subset of the population.  Is it realistic to expect to fight a war without violence?  We saw the same type of violence in the 1920s when there was a war on alcohol.

The same local newspaper that decries violence also reports on a regular basis cases where police have made traffic stops, or answered domestic violence calls, and found drugs, leading to arrests on drug charges.  The local police also set up sting operations to try to entice citizens to sell drugs to undercover police personnel.

The government is fighting a war against the buyers and sellers of drugs, and gun violence is a consequence of that war.  Shouldn’t we expect that when a government declares war against a group, the group would try to arm themselves for their own protection?  As for the police who want to earn citizen trust, is it realistic to hope that those you have declared war against will trust you?

The leftish think tank Demos has published a very thorough criticism of how we measure Gross Domestic Product. Scholar Lew Daly argues that we give government too little credit for its spending, because government invests in goods and services that increase total GDP. For example, household incomes increased dramatically in the 20th century due to an increase in “human capital,” much of which resulted from government-funded education. Therefore, he concludes, government funding of education is good!

Interestingly, Mr. Daly’s evidence relating education to human-capital development and rising incomes is mostly from the 1950s. Needless to say, this was before public-sector-unions and the federal government got involved, and a period in which most people would agree that public schools did a better job than today.

Mr. Daly notes with concern that household incomes have been shrinking as a share of GDP for some years now. However, he does not connect this decline with the fact that households control less of their own consumption than they did in earlier decades. When third parties control so much of what we consume, and we believe those third parties are financed by others, it is unsurprising that those third parties will seize control of a greater share of GDP. Mr. Daly’s shows us that in 1959, households financed 92.8 percent of their own consumption. By 2009, that had fallen to 70.3 percent, with government and employers supplying the balance.