Browsing the blog archives for March, 2017.

Why Ryancare Failed

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Health care reform is a complicated topic, but explaining why Ryan’s health care proposal failed is not.

With all its flaws, Obamacare has forever changed public expectations about healthcare. It’s now unconscionable to expect average Americans to take financial responsibility for their own coverage. Insurance companies are expected to eat losses from consumers with preexisting conditions. Older pre-Medicare Americans shouldn’t have to shoulder the burden of additional health care costs associated with age. Somehow government is supposed to subsidize all of this with a magic wand and additional taxes on “the rich.”

The current mess can only be fixed with a strong dose of free enterprise that requires consumers to budget, make choices, and accept personal responsibility. Many Republicans are too squeamish to back this type of serious reform, so Paul Ryan developed a package of marginal improvements that he thought would placate the moderates. He didn’t figure there would be enough principled Republicans unwilling to accept a dubious promise about more serious changes in phases 2 and 3. He miscalculated.

President Trump had little to do with Ryancare’s failure. It’s just a numbers game. Democrats will oppose any repeal, so the Republicans need to stick together. Moderate Republicans will likely reject a strong market-oriented plan like the one Rand Paul developed. Liberty-minded Republicans have already demonstrated their unwillingness to support a proposal and tweaks the current system. Threading the needle with a compromise acceptable to both ends of the party is not impossible, but it will be very difficult. For the time being, letting the ACA die on the vine is the only option.

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Navigating Health Care

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Senator Paul’s caricature of Ryan’s health care bill as Obama Light seems to be accurate. As the debate ensues, several realities must remain front and center.

As I’ve reminded readers in the past, those of us who warned in 2009 that it would be almost impossible to overturn the ACA were correct. The reason is political. Ending or limiting an entitlement is presented by Democrats and the press as “taking something away from the poor,” and few Republicans have the conviction or the stomach to make the argument. Leftists continue to ask Republicans how they will ensure that anyone who benefitted from Obamacare won’t lose their benefits with a reform. Most Republicans accept the ACA entitlement as a starting point and suggest limited modifications, such as ending the mandate and allowing purchases across state lines. When Representative Jason Chaffetz politely suggested that it might be necessary to forego purchasing a new iPhone to pay for healthcare, the left went crazy. While he is obviously correct, we must accept political reality. Undoing the entire Obamacare entitlement simply will not happen.

While healthcare is not a right because proclaiming it as such creates obligations on others to pay for it, EMTALA requires ERs to provide care to anyone to enters regardless of ability (or willingness) to pay. As a result, basic care at public expense is already encoded in federal law. Conservatives and pragmatic libertarians would be wise to recognize this reality and attack the left’s inconsistency. While Democrats claim to favor the type of “universal access” to healthcare found in other developed countries, but they aren’t willing to tax everyone to pay for it. Granted, wealthier Canadians and Brits pay more that low wage earners to support socialized medicine, but everyone who’s working pays a significant amount into the system. The real issue for the Democrats is not access, but who pays the tab, which is why Chaffetz’s comment struck a nerve.

Most Republicans agree that Americans should not be required to purchase health insurance, but requiring insurance companies to accept applicants with preexisting conditions is equally wrong. This policy cocktail encourages healthy Americans to use EMTALA when they get sick and wait until they need coverage to buy it, thereby creating losses for insurance companies that must be covered by government subsidies, higher premiums, or some combination of the two. The “free rider” reality must be faced head on.

There are sound, free-market ideas that should be a part of healthcare reform. If Republicans are going to unite around a bill that makes a real difference-not just Obamacare Light—they must insist on individual accountability. Quality healthcare will be cheaper in a free market, but it won’t be free. Anyone unwilling to forego an iPhone upgrade to pay medical expenses should be ashamed.

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Illegal Immigration 101

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I’d like to revisit the issue of illegal immigration, but let me make two points at the outset:

First, I am addressing illegal immigration. Like most Americans, I believe immigration is a good thing when managed properly. We can debate issues around legal immigration, but that’s a different topic.

Second, opposing illegal immigration has nothing to do with racism. The idea that anyone who supports immigration law enforcement doesn’t like people of a certain racial or ethnic background is nonsense. It’s a charge designed to gin up fervor on the left and avoid the real discussion. the You could just as easily argue that those who favor open borders are racist because they want to create an ethnic underclass in American society. I’m sure there are a few racists on both sides of this and any issue, but it doesn’t mean that one’s position on the issue is based in racial, ethnic, or religious ideology.If you are not willing to accept these points, then we can’t have a conversation. If you are, let’s talk.

My views are fairly libertarian, so I generally favor individuals moving freely across borders. But several realities must be checked. First, the ongoing terrorist threat is real, and I expect my country to take action to restrict immigration that could create a threat. Doing so requires difficult judgment calls that might not always be the perfect ones, but we must be diligent and take this responsibility seriously.

Second, illegal immigration results in massive cost shifting. Businesses claim that illegal immigrants do the jobs that Americans won’t do, but they don’t finish the sentence—at the wages they are offered. Americans would be willing to do any job at the right wage. Illegals are willing to work for less because they lack job skills and their prospects for employment are not attractive in their native countries. For this reason, they will always be willing to undercut Americans for any jobs they can perform.

But here’s the problem. Businesses might save on wages when they hire illegals, but the additional medical, law enforcement, education, and other costs are passed on taxpayers. Robert Rector’s analysis concludes that the net cost to Americans is $54.5 billion per year (http://www.heritage.org/immigration/report/the-fiscal-cost-unlawful-immigrants-and-amnesty-the-us-taxpayer). Economist Milton Friedman encapsulated this problem in his famous retort, “You cannot simultaneously have free immigration and a welfare state.” If you support open immigration, you are supporting a constant fiscal drain to pay for it. The benefits of cheap labor and cheap prices are overshadowed by lower wages for American workers and higher taxes and deficits.

These two realities require that we address illegal immigration responsibility by enforcing the rule of law. President Trump’s proposals—a temporary ban from seven countries and building a wall on the southern border—are rarely evaluated seriously by the left. They constantly conflate immigration and illegal immigration, and simply tag anyone who thinks we should enforce federal law as racist or anti-Muslim. This is disconcerting to someone like me who cherishes people from all over the world. I don’t blame others for wanting to come to the U.S., I just love my country and want a common sense approach to illegal immigration enforcement.

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