The Affordable Care Act creates a new health insurance marketplace (the exchange). But because of the great uncertainty about what buyers will enter the market and who will buy what product, the law creates three vehicles to reduce insurance company risk.
Politicians and bureaucrats are notorious for manufacturing euphemisms -- clever but deceptive substitutes for what they really mean but don’t want to admit. That’s how the phrase “revenue enhancement” entered the vocabulary. Some of our courageous friends in government couldn’t bring themselves to say “tax hike.”
“It is difficult to make predictions, especially about the future,” says a proverb often attributed to Yogi Berra. Imagine the world of freedom, or lack of it. Who could foresee the technologies that make our lives so rewarding and convenient? The same technologies have us all under the government’s giant microscope. Thankfully, the brave have turned the microscope around.
In the months since Edward Snowden revealed the nature and extent of the spying that the National Security Agency (NSA) has been perpetrating upon Americans and foreigners, some of the NSA's most troublesome behavior has not been a part of the public debate.
National Treasury Union President Colleen M. Kelly recently described the 2014 IRS budget allocation as “woefully inadequate.” But the agency has not proven itself to be an efficient steward of taxpayer dollars. Here are ten ways the IRS lost the trust of the American people.
It’s easy to be negative about the U.S. economy these days. Find a glint of silver, and folks come running to point out all of the dark clouds looming about. This, of course, is what we got last week when the monthly jobs report was released from the U.S. Department of Labor (DOL). Folks pooh-poohed the number of jobs and whining that they’re not enough or that it’s less than a bunch of economists thought that it might be. But you know what? Stuff ’em.
Given how poorly states like California and Illinois have funded the pension funds for their own employees, one would think that this would stop dead in its tracks any plan to have the government assist in managing private sector funds too. The spate of recent activity, however, suggests otherwise.
Facts are easy. You can check facts. What supporters of the Affordable Care Act are doing, on the other hand, transcends factual bungling. It’s far more advanced: a warping of reality so debauched it looks like something out of a tale by H.P. Lovecraft.
The problem for NSA apologist is that when guys like Snowden disclose that the government conducts comprehensive surveillance in ways that would have made 1984’s O’Brien drool, it puts the entire progressive agenda in jeopardy.
The east coast and parts of the southern U.S. were to varying degrees paralyzed by blizzards a few weeks ago. The snow as expected rendered the roads treacherous, and in anticipation of slick streets, shoppers flocked to the grocery stores in advance.The rush into grocery stores, and its aftermath, offers worthwhile lessons in economics.First up, […]
The financial world is plodding along like a drunken sailor avoiding debt collectors by keeping no cash in his wallet. It’s not the kind of calm that’s going to last or end well. But the storm will have to wait until after the Olympics.What a game! We’ve never watched ice hockey closely before. But watching […]
“When they come for my gun, they will have to pry it out of my cold, dead hands,” is a common refrain I often hear from the Neo-Cons when there is a threat, credible or otherwise, that the U.S. government is going to take their firearms.And, when I hear this crazy talk, I agree with […]
The highest form of charity, argued the 12th-century Jewish philosopher Maimonides, is when the help given enables the receiver to become self-sufficient.But our systems of state charity — aka welfare — have too frequently had the opposite effect: They have actually created dependency. It is time to rethink the way we help people.I’m going to […]
In times of war and national emergency, it’s sometimes necessary to sacrifice civil liberties to secure vital gains in public safety. In those cases, we may have to accept a loss of privacy or freedom rather than invite mass slaughter of Americans.The National Security Agency’s domestic phone records collection is not one of those.Never have […]
President Obama crowed in his State of the Union speech about the economy, even mentioning “a rebounding housing market.” Maybe he was referring to friends in high places, like the seller of Penthouse One in New York, which just closed for $50.9 million, all cash. Millions of mere-mortal homeowners likely wanted to throw something at […]
The nonpartisan Congressional Budget Office is acting in a bipartisan way to cover up the biggest single threat to the bipartisan political alliance that is stripping America of its wealth: the United States Congress.There is no question that the following policy is bipartisan. Democrats and Republicans in Congress are completely agreed that the following information […]
Recent difficulties with implementing the Affordable Care Act have increased opposition to the program. A majority of Americans now oppose it. Problems with the HealthCare.gov website are in all likelihood temporary. However, there are serious long-term problems, particularly considering long-term finance and labor supply issues. Given the mounting difficulties with and growing concerns about the […]
Amidst all the revelations about how the American people, many of whom are absolutely convinced they live in a free society, have their telephone calls, emails, website visits, and who knows what else under surveillance by their own government, let’s not forget the massive infringements on financial privacy that have gone on for decades.Consider, for […]
Image: ShutterstockBitInstant CEO Charlie Shrem, along with alleged co-conspirator Robert Faiella, was arrested by federal authorities last week for allegedly laundering more than $1 million worth of Bitcoins. This is a tiny amount compared to the largest drug-and-terrorism money laundering case ever. Yet when British bank HSBC was found guilty in 2012 of laundering billions, […]
Do you trust your doctor? Most patients assume their doctor is working in their best medical interests whenever he or she orders a diagnostic test or recommends a particular treatment. Customers might wonder whether an unscrupulous auto mechanic is being truthful when he recommends a brake job or a new transmission. But most patients trust […]
The exercise had an awesome name, inspired by the movies: “Quantum Dawn 2.”On July 18, scads of U.S. banks, stock exchanges and government agencies took part in a digital fire drill — a practice run in the event all of Wall Street came under massive cyberattack.This isn’t the first time banks have come under an […]
The faces of the Detroit bankruptcy are the thousands of pensioners whose promised benefits are suddenly part of the restructure negotiation. When Motown filed for Chapter 9 last July, the city had $11.5 billion in unsecured liabilities. The vast majority of this was pension and health care benefits owed to retired city employees.The images of […]
So you’ve maneuvered the Obamacare website, plugged in your top-secret information and found out how much you are forced to pay to avoid a fine.And for some of you, it turns out you qualify for a government subsidy — making the premium sound like a bargain. But signing on that line to accept the government’s […]
“Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”As the inequality gap grows, there is an ideological battle unfolding in the West.On the one hand, there are those who think government can fix things. It must do more, tax more, […]
On Feb. 7 the United States will once again reach its statutory debt limit, meaning it cannot legally borrow any more money. Since the obvious option of cutting spending to match the amount of revenue that the government collects is off the table for some inexplicable reason, Congress will have to pass a new, higher […]
The New York Times published an interminable article on health care recently. Plenty of facts — how scrupulous are these journalists! — but the article displayed absolutely no comprehension of the basics of cause and effect. I was left wondering about the whole point.The article details how the health care system rewards specialists to an […]
For critics of the surveillance state, it is tempting to see President Obama’s speech a few weeks ago as a partial victory: Prompted by Edward Snowden’s leaks and the public pressure for National Security Agency reforms, he announced significant changes to the program that collects and stores information about all telephone calls. And he promised […]
Winter is upon us, and that means digging out of our closets a whole variety of different kinds of shoes. There are insulated hiking boots, trail shoes, specialized hunting boots, waterproof shoes, and more.
Ah, the wonderful varieties provided for us by the marketplace!
Thank goodness government never did to shoes what it has done to education and health care. If it had, prices would be going up, instead of down, and we’d probably have only a handful of models for all seasons.
Only government-approved shoe stores would exist. And there would probably be no such things as specialty outdoor shoes, which now account for 30% of the retail sales of outdoor equipment in general (which itself is a $646 billion industry).
Yet an interesting thing happened just following the election. The Obama administration, without warning, announced that it opposes prolonging a suspension of tariff walls on the materials that go into making these specialty products. To put it plainly, there is going to be a new tax on imports on your shoes. And it begins on Jan. 1, 2013.
(If you want to know more about the legal mechanism being overridden here, look up “miscellaneous tariff bill”; it is a slight window of freedom in an otherwise closed system.)
This puts many importers and foreign producers in a terrible bind. They’ve already made their business plans and purchases based on the assumption that the lower tariff rates will apply. Industry experts are predicting price hikes of an immediate 38% on outdoor shoes. It will hurt sellers, manufacturers, and especially consumers.
Why would the Obama administration do this? I have no inside knowledge. But if this action fits most such actions, it comes down to a political payoff for some industrial competitor somewhere. It has nothing to do with saving jobs. It is saving some friends of the government at the expense of everyone else. Another possibility is that this action helps give more work and power to the U.S. Customs agency and its public-sector union.
Maybe you have noticed: There is no national controversy about this. It is left to institutions like the Outdoor Industry Association to plead with their members to write, call, petition, beg, or do whatever is necessary to save themselves from the tax. After all, that’s what a tariff is. This tax hurts the many and benefits the few.
In effect, business is back to begging to do business. Does it work? Sometimes it does, provided the affected industries grease the right palms. Often, it doesn’t work. So people will show up at their favorite store in mid-January and be appalled at the suddenly soaring prices of outdoor shoes. Will they curse the Obama administration? Nope. Most people are completely unaware of just how protectionist U.S. trade policy truly is and how it affects millions of products. Instead, they will blame the retailer for gouging or the manufacturer for being greedy. The private sector will again be blamed for the actions of government.
I’m particularly intrigued by these kinds of actions because they suggest the real way that government undertakes its dirty work. Mostly, it is out of public view. It consists of petty bureaucrats working with various industry groups to rig the system in favor of whoever has the political power and muscle to pull it off. The public debates and the elections have very little at all to do with it. In fact, there is no debate about most of what government does.
It’s not so much that it takes place in secret. Most all information is publicly available. The problem is that no one but the most affected have the incentive to watch what is happening in any particular sector on a day-by-day basis. That’s why, if you really want to know what government is doing to business, you have to ask an industry expert. Only they get the communique. Only they have a strong incentive to act.
People think of protectionist policy as a benefit to domestic businesses. This is not true. This is a clear case in which most of the harm of the protectionist policy is done to American business. The reason is that economic production takes place over many stages of production, and these are ever more spread throughout the world. A tax on imports ends up affecting domestic manufacturers and sellers, imposing artificially high costs of doing business.
To be sure, there are remaining forms of protectionism that are a clear sop to American industry. To my astonishment, The New York Times ran an Op-Ed about one just the other day. Maybe you have noticed this, but foreign airlines are not allowed to serve domestic routes in the U.S. They can land in U.S. airports, but they have to head out with passengers destined for foreign countries.
As a result, U.S. air carriers do not face the level of competition they would otherwise. I noticed this only recently when I took a flight on Turkish Airlines. The plane was beautiful, the chairs comfortable, the service fantastic, and everything worked. I was amazed because this is a government-owned airline. Generally, it was vastly better than what we American consumers have come to expect from American companies.
Well, Turkish airlines serves a highly competitive market throughout Europe and the rest of the world. The U.S. is actually unusual in this respect. Only American companies are allowed to serve American domestic routes. The result is a lessening of price competition and reduced service. This serves to powerful interest groups: the air carriers themselves and the labor unions that work for them.
If you think about it, this is an egregious regulation, one that would never exist in a situation of free enterprise and free trade. And the hypocrisy is overwhelming. In the land of the free, the home of all things bright and beautiful, we have draconian laws that keep foreign suppliers out, like some kind of mercantilist medieval fiefdom. What possible harm could come from letting British Airways take me from Atlanta to Chicago?
The cause of free trade has always been about the common man. It is about the right of average people to trade with whomever they want. Protectionism, in contrast, is another way for powerful people to extract money from our pockets and reward their political friends with legal favors. In other words, it’s a rip-off.
You and I might be reminded of this in the dead of winter 2013, when that pair of hiking boots we had our eyes on suddenly soars in price and, instead of buying, we decide to stay home in our slippers and contemplate the fate of liberty in our time.
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