In April of 2010, Jonathan Gruber, one of the architects of ObamaCare and an adviser to the Obama Administration, suggested that we tax people based on their weight. (Full essay here.) The theory is that fat people spend more in health care dollars, so we can tax to “modify behavior and raise revenue.”
If people who smoke, drink, don’t work out, or are professional bungee jumpers have higher health care costs than everyone else, then I have no problem with a private insurance company raising their rates. We do this for auto and homeowner’s insurance all the time: you pay more if you speed, drive drunk, or live in a place that gets hit by hurricanes. A private insurance company that charges people too much for various “sins” will lose those customers; an insurance company that charges too little will lose money. The force of the free market will push companies to get the most accurate risk assessment possible, and those companies would be just as happy with people quitting smoking and paying less as they would with smokers paying a penalty to cover their additional costs.
None of this is true about government sin taxes. Aside from the creepy and coercive nature of the government attempting to regulate our lives through financial penalties, extorted from us with the threat of jail if we do not comply, the government will tend to rely on increased ‘sin’ revenue. The money from cigarettes or adipose that pays for schools will no longer be there if people quit smoking or slim down. The government also has an incentive to increase this tax to the point just before political backlash: there is no downward pressure from competing governments that are ready to charge an amount that is more tailored to the expenses incurred from such weight.
Economics of sin taxes and insurance premiums aside, this is also problematic because weight is not what causes people to incur excess health care costs: it is fat, lack of physical fitness, high blood pressure, low muscle mass, and a host of other things. Most likely, the government will simply calculate our BMIs and tax us, rather than attempt the fine-tuned calculation of taxing people whose body composition puts them at a higher risk for health problems. It also highlights one of the many problems with socialised medicine: once you are forced to pay for some stranger’s health care, you have every right and incentive to stick your nose in that stranger’s business and dictate how his life ought to be run. It’s an ugly business, served up to us in the name of compassion.
This is a health care law and policy blog, but I really loathe writing about ObamaCare these days: every single post would be some version of I told you so.
Just for the record, a few links about the current state of the O-care debacle: the people signing up for the exchanges are older and sicker than anticipated (hat tip), and five ways in which Charles Balhous was right about the “Affordable” Care Act and its proponents were wrong (hat tip). Those five issues are not small issues; they are fundamental problems that will cripple this health insurance “reform.”
The latest revelation in the VA scandal again highlights why governments are inherently incapable of doing private-sector jobs as well as the private sector: psychiatric patients received no evaluations for years. (Hat tip.) It gets better: “[The Office of Special Counsel} is reviewing even more cases — approximately 60 — of allegations that those who came forward with concerns about scheduling, understaffing, and patient care faced retaliation by their superiors.”
The private sector is not perfect, but this stuff would not last nearly as long in the competitive marketplace. A competitive industry would take customers away from the one that performed poorly; those companies that retaliate against their employees, treat their patients/clients like dirt, and cook the books will lose people to other businesses. Falling profits force such companies to either root out the problems or go out of business.
The government can also intervene: when aggrieved clients, patients, and customers can sue the offending company, the government is a neutral arbitrator. However, when normal citizens attempt to seek redress through the court systems against a government institution, they are either outright barred by suing due to sovereign immunity, or they are seeking justice in a system wherein the defendant is on the same team as the judge. It would be like suing one of the Koch brothers, walking into the courtroom, and finding that the other brother is the presiding judge. See the problem?
See the problem?
Filed under Law, ObamaCare
The Veteran’s Administration debacle is such a scandal because it involves breaking a promise to those who risked their lives, health, bodily integrity, and sanity for the country, and it also underscores the many problems that come with government-run businesses. One such problem is that the government cannot act as an umpire when it is also a player in the game: while it can regulate other businesses in the marketplace and bring prosecutions or civil charges as needed, it is fundamentally incapable of policing itself. Rather than have the government as a neutral third party to ensure that people and companies do not commit rampant fraud, we have a government that is structurally accountable to no one, and victims of its malfeasance lack any redress. While the IRS and Benghazi scandals are dismissed as ginned-up ideological issues, it is hard to do the same for the V.A. when the underlying issues (i.e. total lack of accountability for a government agency or actors) are involved.
Just as the government holds corporations accountable, so do markets. An inefficient corporation that does not provide quality goods or services will find that its customers go elsewhere. While it may struggle to pinpoint the source of the problem (e.g. bad customer service, faulty reporting by employees, or a poor product), it will either find and redress the problem or go out of business.
While I agree with Megan McArdle that the scandal is bigger than any one President, I disagree with her that such an idea exempts Obama from criticism. In 2008, Obama was more than happy to play the Wonderball game: the one holding the ball when the timer runs out (in 2008, it was on the housing and stock markets) is the loser. If that was his standard in 2008, it should be the standard to which he is held in 2014.
In a larger sense, Obama has done things that promote the evils of the V.A. scandal: on a structural level, he has presided over a massive growth in the federal government, and his signature accomplishment is to bring the V.A. system to all Americans. It’s not that his actions are neutral on this and momentum carried the malfeasance through his term; his entire Presidency has been aimed at making these scandals happen to all of us. Without government or market oversight, this is our future under ObamaCare – a future that we warned the nation about, but for which we were viciously derided by the current occupant of the White House.
The prescriptions for avoiding such scandals in government agencies are simple: reduce the size of government, eliminate sovereign immunity, outsource as much as possible to the private sector and let competition clear things up, and ensure that at least some reporting is done by the people, not the bureaucrats.
When I started this blog over a year ago, my intention was to write about health care policy and the law. I wrote about the ways to fix health care, why ObamaCare is inherently flawed, and the problems in Europe. Lately, I’ve written about other subjects, because the big ObamaCare news is how we (conservatives and libertarians) were right: the system is inherently broken amd will create an insurance death spiral. (Hat tip.)
Remember how ObamaCare was “budget neutral” and would provide higher-quality insurance to more people for no extra money?
Sorry, folks: the numbers are out, and it’s going to cost us $1.5 trillion – and yes, if current trends continue, fewer people will have health insurance than before this monstrosity took effect.
In a free-market system, costs go down and access goes up: people find a way to streamline production and delivery of goods and services so that they can undercut their competition and gain market share. That’s why it cost about ten thousand dollars a year for a car phone in 1980, but modern cell phones with Internet access are available for $50/month.
However, Moore’s law and its equivalents do not apply to socialist (or heavily government-run) systems. In fact, the reverse happens: more money for less product. It is, in all ways, the reverse of the free-market progress outlined above. That, my friends, is what happened with ObamaCare.
As speculation has grown about the Republicans retaking the Senate this November, so has the discussion about what it would mean for Democrats. Short answer: nothing, unless the GOP grows a set. If that happens, however, it will be a death knell for liberalism.
The House and the Senate can repeal the “Affordable” “Care” Act and replace it with a simpler act that enables people to buy insurance across state lines, removes the employer and individual mandates, allows for a broader range of insurance products to be sold (e.g. catastrophic insurance, 80/20 plans, and those with great networks), and ends the business of having young people subsidise older people. Of course, the IRS would not be a part of it: it would be nothing more than free-market principles on display.
They then send this Act – which would be rather popular with the people – to the Resolute Desk for a signature. President Obama would then either have to sign in the repeal of his signature achievement or veto a very popular bill.
The added bonus? Republicans would be the party of good idea that people like, not the party of no.
James Taranto discusses Obama as a celebrity in regards to ObamaCare and how young people are just not that into it:
Obama supporters have a quaint faith in the power of marketing. They don’t seem to grasp that persuading people to vote for one politician over another–essentially a cost-free proposition–is a far smaller order than persuading them to purchase an expensive product, especially one that offers a poor value for their money.
With all respect due to Mr. Taranto, I think the problem is not one of marketing, but of reality. President Obama seems to think that saying something will bring it into being, as if he had watched too many Hollywood movies wherein a particularly inspiring speech changed the course of history. A speech can remind people why they fight, but it can’t save lives; it can inspire people to try something, but it cannot ensure their success; and there is nothing about speech that is inherently accurate.
I know that this is a law blog, so I should be writing deep lawyerly thoughts on the Hobby Lobby case, but my comments are related to policy and feminism:
Did anyone else notice that the anti-Hobby Lobby argument (i.e. that women need their employers to buy their contraception) is really insulting to women?
My boss doesn’t pay for my rent, car, cat’s vet bills, food, or gun, but no one thinks that he’s denying me housing, transportation, the health of my pet, nutrition, or personal protection.
Yet these “feminists” are applying a different set of rules to contraception, claiming that if their boss doesn’t pay for it, they are denied access to it. The underlying assumption seems to be that sexually active women are too mentally incapacitated to use their paychecks to buy whatever contraception they need or do not need.
Isn’t THAT insulting to women? How insane would it be to say, “My boss won’t buy me my groceries he wants me to starve to death”? Normal people just buy their own food and leave their boss out if it – after all, the entire point of money is that it’s fungible and can be used for whatever legal ends the owner wants to use it for.
Why are empowered women too stupid to figure out how to use this thing called a “paycheck” to buy birth control, when they already use that very same paycheck to take care of other adult needs? Isn’t that assumption the one that is really infantilising to women, i.e. that we need smarter people to figure out basic life skills for us?
Dwight G. Duncan wrote a op-ed in the Boston Globe wherein he outlined the American tradition of using corporate charters to advance religious liberty. (Duncan filed an amicus brief for the Hobby Lobby case on behalf of Massachusetts Citizens for Life, the Massachusetts Family Institute, and the Pro-Life Legal Defense Fund.) As Duncan writes, “The argument has been made that since corporations don’t go to heaven or hell, family businesses should not be able to freely exercise religion.”
The problem with that argument is that a “corporation” is nothing more than an agglomeration of individual people. If a “corporation” has to certify that they are providing potential abortifacients, then some human being within that company must sign off on the paperwork, cut a check to the company providing Plan B, and ensure that all female employees have access to it. That a “company” does this action hardly means that it just magically happens: rather, an employee or employees must be the ones to ensure that the mandated action occurs and other individuals within the company must pay for it.
Imagine a rule that required companies to be open on the Sabbath. “You’re just a corporation; the corporation does not need a day of rest,” goes the logic.