Get Ready to Be Reamed

With so many scandals percolating, there are lots of good cartoons being produced.

But I think this Chip Bok gem deserves special praise.

It manages to weave together both the costly Obamacare boondoggle with the reprehensible politicization of the IRS.

So BOHICA, my friends.

If you want other Chip Bok cartoons, click here, here, here, here, here, here (my favorite), here and here.

And for cartoons that mix the IRS and Obamacare, click here, here, and here.

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Cartoonists Go to War against Obamacare

After the Supreme Court’s politically motivated decision to approve Obamacare, I shared a bunch of depressing (but funny) cartoons, including a few focusing on added power for the IRS.

That was a miserable point in time.

Five Justices on the Supreme Court basically said the Constitution didn’t limit the federal government, even though that’s exactly what our Founding Fathers were trying to do when they put together the document! And they gave the green light to a costly expansion of the welfare state.

Oh, and that decision was handed down on my birthday. What a kick in the gut.

Since that time, though, I’ve become a bit more optimistic.

I’m feeling hopeful because Obamacare is turning out to be a disaster. But why is that a reason for optimism?!?

Well, as I recently wrote, this creates an opportunity to help people understand that big government is the problem in health care.

Obamacare was enacted in 2010, and it was perceived to be a paradigm-shifting change in the healthcare system, even though it was just another layer of bad policy on top of lots of other bad policy. …But because people think we’ve had a paradigm shift and government now is in charge (pay attention, since this is my key argument), they will be much more likely to blame “Obamacare” and “government” for all the warts and inefficiencies of the healthcare system. This means the public will be more receptive to pro-market policies, such as Obamacare repeal, tax reforms to reduce over-insurance, as well as the Medicaid and Medicare reforms in the Ryan budget.

Here are some new cartoons that illustrate the law’s growing unpopularity.

We’ll start with this contribution from Eric Allie.

For obvious reasons, it sort of reminds me of this Jerry Holbert cartoon.

Our next cartoon is from Henry Payne.

And here’s one from Chuck Asay, our runner-up from the cartoon contest.

What makes the Asay cartoon so appropriate is that people who supported the law will now have to defend every bad thing that happens.

Speaking of which, a prominent Democrat recently warned that Obamacare was turning into a “train wreck,” and Steven Kelley turned that comment into a very good cartoon.

Let’s close with another Henry Payne cartoon.

A very relevant cartoon since the job market remains far below its potential. Something else that defenders of the law will have to justify.

If you haven’t exhausted your interest in anti-Obamacare cartoons, you can enjoy some others here, here, here, and here.

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Should Politicians Be Allowed to Exempt Themselves and their Staff from Obamacare?

I get upset by a lot of what happens in the corridors of power, but two things really irk me.

First, I hate it when the rich and powerful use the coercive power of government to screw ordinary people. That’s one of the reasons I hated the TARP bailout.

Second, I hate the utter hypocrisy of the political elite exempting themselves from the bad policies that get imposed on everyone else. That’s why, for instance, it galls me that the pro-tax bureaucrats at the OECD get tax-free salaries.

Well, now we have a new example of political hypocrisy. Behind closed doors, the crooks in Washington are seeking to exempt themselves from Obamacare.

Here are some of the sordid details reported by Politico.

Congressional leaders in both parties are engaged in high-level, confidential talks about exempting lawmakers and Capitol Hill aides from the insurance exchanges they are mandated to join as part of President Barack Obama’s health care overhaul, sources in both parties said. The talks — which involve Senate Majority Leader Harry Reid (D-Nev.), House Speaker John Boehner (R-Ohio), the Obama administration and other top lawmakers — are extraordinarily sensitive, with both sides acutely aware of the potential for political fallout from giving carve-outs from the hugely controversial law to 535 lawmakers and thousands of their aides. Discussions have stretched out for months, sources said. …if Capitol Hill leaders move forward with the plan, they risk being dubbed hypocrites by their political rivals and the American public. By removing themselves from a key Obamacare component, lawmakers and aides would be held to a different standard than the people who put them in office. …There is concern in some quarters that the provision requiring lawmakers and staffers to join the exchanges, if it isn’t revised, could lead to a “brain drain” on Capitol Hill, as several sources close to the talks put it.

Well, to be thoughtful and analytical, my reaction is boo hoo and cry me a friggin’ river.

Obamacare is a fiscal disaster and a healthcare disaster. Our best bet to get the law repealed is to make sure the politicians and their underlings are subject to all of the law’s bad provisions. Period.

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Why We Should Be Optimistic about Repealing Obamacare and Fixing the Healthcare System

I’m going to make an assertion that seems utterly absurd.

The enactment of Obamacare may have been good news.

Before sending a team of medical attendants to cart me off to a sanitarium, allow me to elaborate. I’m not saying Obamacare is good policy. After all, I’ve written over and over again that it is a budget-busting boondoggle that will exacerbate our real healthcare crisis of third-party payer.

What I am saying, though, is that Obamacare may turn out to be a major political mistake for the left, one that sets the stage for sweeping free market reforms.

Here’s my six-part hypothesis.

1. Our healthcare system as a mess before Obamacare. Normal market forces were crippled by government programs such as Medicare and Medicaid and also undermined by government intervention in the tax code that resulted in pervasive over-insurance that exacerbated the third-party payer problem.
2. These various forms of intervention led to all sorts of problems, such as rising prices and indecipherable complexity, and most people blamed that the “free market” and “private” healthcare.
3. Obamacare was enacted in 2010, and it was perceived to be a paradigm-shifting change in the healthcare system, even though it was just another layer of bad policy on top of lots of other bad policy. Immediately after the legislation was approved, I offered a rough estimate that we went from a system that was 68 percent dictated by government to one that was 79 percent dictated by government.
4. Not surprisingly, all of the same problems still exist, but now they’re exacerbated by the mistakes in Obamacare.
5. But because people think we’ve had a paradigm shift and government now is in charge (pay attention, since this is my key argument), they will be much more likely to blame “Obamacare” and “government” for all the warts and inefficiencies of the healthcare system.
6. This means the public will be more receptive to pro-market policies, such as Obamacare repeal, tax reforms to reduce over-insurance, as well as the Medicaid and Medicare reforms in the Ryan budget.

All this will be much easier said than done, of course, and it is disconcerting that we’ll probably have to rely on feckless Republicans to implement these reforms.

But at least there’s a plausible scenario for systemic reform, and that wasn’t the case before Obamacare was enacted. In other words, the President’s signature achievement may turn out to be a Pyrrhic victory for the left.

P.S. Watch this excellent video from Reason TV to see how a genuine free market could deliver health care at lower cost and with greater efficiency. For another example, here’s a report from North Carolina on free-market healthcare in action.

P.P.S. This post is part of my let’s-be-optimistic series. Previous editions include:

• The fiscal cliff was a smaller loss than I expected.
• The sequester was a real victory.
• We have good evidence that the Tea Party has made a positive difference.
• The Democratic-controlled Senate rejected a permanent expansion of funds for the IMF.
• The burden of government fiscal policy has been reduced since the 2010 elections.
• The Democrat-controlled Senate approved dynamic scoring.

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Pick Your Favorite April Fool’s Day Prank

Even though I appreciate clever humor, I’ve never shared any April Fool’s Day jokes.

• Looking back in my archives, I didn’t post anything on April 1, 2009.
• I did post a joke about the IRS on April 1, 2010, but it had nothing to do with April Fool’s Day.
• In 2011, I posted about Paul Krugman’s misreading of budget data from the United Kingdom. That should have been an April Fool’s joke, but he was serious.
• I also shared some horrifying stories about the welfare state on April 1, 2012. I wish they were April Fool’s jokes, but they’re sadly true.

Indeed, the only time I even referenced April Fool’s Day came on the following day, when I stated that America’s high corporate tax rate meant that every day was April Fool’s Day for American companies.

So it’s time for me to remedy my oversights by sharing four good examples of April Fool’s Day humor.

Our first contribution is from Senator Ted Cruz. He takes a jab at President Obama for the budget-busting Obamacare legislation.

Our next contribution comes from Americans for Tax Reform. They’ve issued a press release announcing that America’s leading crony capitalist will voluntarily subject himself to the higher taxes he advocates for other Americans.

As you can see from this video, don’t hold your breath waiting for that to happen.

Then we have some mockery of Chris Matthews from the Media Research Center. There are a bunch of absurd, yet mostly believable, quotes.

Since I’m a fan of entitlement reform, here’s the one I’m highlighting.

But the most implausible April Fool’s Day joke comes from CNS.

America’s Spender-in-Chief wants to be a role model of fiscal rectitude.

Hey, maybe the President can give every teenager an unlimited credit card and tell them that more spending is good for the economy according to Keynesian economics. Though I’m not sure whether who that joke will hurt the most, the kids, the parents, the economy, or the nation?

Feel free to add any good April Fool’s Day humor in the comments section.

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Obamacare May Be a Joke, but We’re Paying a Heavy Price for some Amusing Cartoons

I’m not sure why political cartoonists have been revisiting the issue of Obamacare in recent days, but I’ve been enjoying their humor.

I shared three funny cartoons a couple of days ago, adding to my collection of Obamacare humor (see here, here, here, here, here, here, here, and here).

Now let’s enjoy three more, beginning with this gem from Lisa Benson.

Though we shouldn’t laugh at this cartoon. As we saw with both Medicaid and Medicare, entitlement programs routinely cost far more than original projections.

If you somehow think Obamacare might be different, watch this video.

Gary Varvel hits a different part of Obamacare, noting that the President’s promise of lower premiums is an utter fantasy.

And Michael Ramirez looks at the big picture.

I want to close with an optimistic point about the prospect of changing this terrible law.

Thanks to government programs and other forms of regulation and intervention, we had a bad healthcare system before Obamacare.

And even though it was government that was causing the system to malfunction, many people blamed the free market. And the President took advantage of that misunderstanding to push he legislation.

So now we have Obamacare, which has made the system a bit more statist.

But most people think Obamacare was much bigger than it actually was, with some actually thinking we used to have a free market!

Anyway, this flawed perception works to our advantage since it will now be possible to blame any bad news in the healthcare world on  Obamacare.

As such, I expect that Obamacare will remain unpopular.

The real question will be whether reformers will rally behind proposals to not just repeal Obamacare, but to actually restore a free market.

If you want to understand what needs to happen, I encourage you to watch two short videos, one from Reason TV and the other from the Center for Freedom and Prosperity.

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An Obamacare Chart to Make You Cry…Balanced by Obamacare Cartoons to Make You Laugh

I’ve shared a nightmarish flowchart to show the Byzantine complexity of America’s healthcare system under Obamacare. Sort of makes you wonder whether the healthcare system will now be more complicated than the internal revenue code.

But some people may be skeptical because this flowchart was prepared by Republicans from the Joint Economic Committee.

Well, here’s a flowchart from the pro-Obamacare Washington Post, and it shows how just one small piece of the law will require complicated gymnastics.

It’s hard to feel anything but misery about this situation. The Obamacare taxes largely took effect earlier this year and a big chunk of the Obamacare spending starts next year.

So let’s with a great cartoon from Henry Payne showing the Secretary of Health and Human Service force-feeding Obamacare to states.

I would have replaced “states” with “patients,” but you get the point. We’re being saddled with a one-size-fits-all monstrosity that will cripple what little is left of a functioning marketplace for health care and health insurance.

Next we have a Lisa Benson cartoon, showing the very unhealthy meal we’re expected to digest. Where’s Mayor Bloomberg when we actually need him?!?

Both Benson and Payne were part of the political cartoonist contest, so you can see their best work by clicking here.

Last but not least, here’s Steven Breen’s take on the third birthday of Obamacare. As you can see, there’s not a lot to celebrate.

Indeed, this is a good opportunity to share my video explaining why Obamacare will be a budget buster.

P.S. Lawmakers did repeal one of Obamacare’s tax provisions, a 1099 reporting rule that would have buried everyone under a blizzard of paperwork (here’s the cartoon version of that issue). And the Democratic-controlled Senate recently voted 79-20 to repeal the medical devices tax. So there are small reasons for optimism. And I think the bulk of Obamacare spending could be repealed as part of a Medicaid block grant if and when Washington is controlled by lawmakers who are serious about addressing the entitlement crisis.

P.P.S. If you want to enjoy some more Obamacare humor, click here, here, here, here, here, here, here, and here.

P.P.P.S. If you want to know how to restore a functioning market-based healthcare system, this video from Reason TV is must watching.

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Which Nation Has the Most Per-Capita Government Spending on Healthcare: France, Italy, the United States, Sweden, Canada, Greece, or the United Kingdom?

What government spends the most on health care?

• Is it Canada or the United Kingdom, which are famous (or, if these stories are any indication, infamous would be a better description) for single-payer healthcare systems?
• Is it Sweden, the home of the cradle-to-grave welfare state?
• Or France, the land of the world’s most statist people?
• How about Italy or Greece, nations that have spent themselves into fiscal crisis?

Nope, nope, nope, and nope.

The United States spends more money, on a per-capita basis, than any of those countries. Here’s a chart from a Forbes analysis prepared by Doug Holtz-Eakin and Avik Roy.

There are three big reasons why there’s more government-financed healthcare spending in the United States.

1. Richer nations tend to spend more, regardless of how they structure their healthcare systems.

2. As you can see at the 1:18 mark of this video, the United States is halfway down the road to a single-payer system thanks to programs such as Medicare and Medicaid.

3. America’s pervasive government-created third-party payer system leads to high prices and costly inefficiency.

So what’s the moral of the story? Simple, notwithstanding the shallow rhetoric that dominates much of the debate, the United States does not have anything close to a free-market healthcare system.

That was true before Obamacare and it’s even more true now that Obamacare has been enacted.

Indeed, it’s quite likely that many nations with “guaranteed” health care actually have more market-oriented systems than the United States.

Avik Roy argues, for instance, that Switzerland’s system is the best in the world. And the chart above certainly shows less direct government spending.

And there’s also the example of Singapore, which also is a very rich nation that has far less government spending on healthcare than the United States.

If you read the Avik Roy articles linked above, and also this study by my Cato colleague Mike Tanner, you’ll see that there’s no perfect system.

Our challenge is that it’s very difficult to put toothpaste back in a tube. Thanks to government programs and backdoor intervention through the tax code, the United States healthcare system is nowhere close to a free market (with a few minor exceptions such as cosmetic surgery and – regardless of what you think of the procedure – abortion).

Yes, I think entitlement reform can make things better, though fixing Medicare and Medicaid should be seen as a necessary but not sufficient condition. As I show in this post, we would simply move a little bit in the right direction on the spectrum between markets and statism.

Tax reform could solve another part of the problem by removing the bias for over-insurance, which presumably would lead people to pay out of pocket and use insurance for large, unexpected costs.

Fundamental tax reform is also the best way to improve the healthcare system. Under current law, compensation in the form of fringe benefits such as health insurance is tax free. Not only is it deductible to employers and non-taxable to employees, it also isn’t hit by the payroll tax. This creates a huge incentive for gold-plated health insurance policies that cover routine costs and have very low deductibles. …Shifting to a flat tax means that all forms of employee compensation are taxed at the same low rate, a reform that presumably over time will encourage both employers and employees to migrate away from the inefficient over-use of insurance that characterizes the current system. For all intents and purposes, the health insurance market presumably would begin to resemble the vastly more efficient and consumer-friendly auto insurance and homeowner’s insurance markets.

In other words, as this poster suggests, government is the problem and less government is the solution.

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What’s the Difference Between Romneycare and Obamacare?

That’s a trick question, of course, as illustrated by this biting Henry Payne cartoon.

But let’s look at one of the commonalities of Romneycare and Obamacare – higher premiums, thanks to mandates and third-party payer.

Here’s a quick look at what’s been happening to premiums in Massachusetts.

The same thing is already happening with Obamacare, as explained in a Wall Street Journal column by Merrill Matthews and Mark Litow.

The congressional Democrats who crafted the legislation ignored virtually every actuarial principle governing rational insurance pricing. Premiums will soon reflect that disregard—indeed, premiums are already reflecting it. …Guaranteed issue incentivizes people to forgo buying a policy until they get sick and need coverage (and then drop the policy after they get well). While ObamaCare imposes a financial penalty—or is it a tax?—to discourage people from gaming the system, it is too low to be a real disincentive. The result will be insurance pools that are smaller and sicker, and therefore more expensive.

How bad will it be? Well…

Many actuaries, such as those in the international consulting firm Oliver Wyman, are now predicting an average increase of roughly 50% in premiums for some in the individual market for the same coverage. …Arizona, Arkansas, Georgia, Idaho, Iowa, Kentucky, Missouri, Ohio, Oklahoma, Tennessee, Utah, Wyoming and Virginia will likely see the largest increases—somewhere between 65% and 100%. Another 18 states, including Texas and Michigan, could see their rates rise between 35% and 65%.

Which is why 2014 is the “Year of the Snake” in more places than just China.

If you like Ramirez cartoons, you can see some of my favorites here, here, here, here, and here.

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What’s the Best Term for Describing Obamanomics and Obamacare?

I’m a big fan of John Mackey, the CEO of Whole Foods. Not only is he a successful, job-creating entrepreneur, but he also cited my work (specifically, this budget analysis) when interviewed by the statists at Mother Jones.

He also has some good insights about the economics of Obamacare. Here’s the key passage from the Washington Times report.

The CEO of Whole Foods compared President Obama’s health care law to “fascism” in a radio interview on Wednesday, a turnabout from earlier comments in which he compared the signature reforms to socialism. “Technically speaking, it’s more like fascism,” John Mackey told NPR’s Morning Edition. “Socialism is where the government owns the means of production. In fascism, the government doesn’t own the means of production, but they do control it — and that’s what’s happening with our health care programs and these reforms.”

I’ve already provided my two cents on the underlying theory of Obamanomics, and I agree that socialism is not the right term.

Like Thomas Sowell and John Mackey, I think that it’s technically more accurate to say that Obamacare is fascism – nominal private ownership but government control.

But I’ve also concluded that it’s a distraction to use that term. Which is why I prefer to call Obama a statist or corporatist. Though maybe we should add redistributionist to that list.

P.S. Here’s the Obama version of Socialism for Kids.

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More Stomach-Turning Horror Stories from the UK Government-Run Healthcare System

During the Obamacare debate, Paul Krugman told us we could ignore stories about what was happening across the ocean, writing that “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.”

Every so often, I wonder how Krugman would define a “scare story.” How about starving babies to death, as I wrote about last month? Would he say that’s “false,” or simply not a “scare story”?

Let’s look at some new information from the U.K.’s government-run system and see whether we can expect our healthcare to improve or deteriorate now that Obamacare’s beginning to get implemented.

We’ll start with a look at how the overall British system is performing, including the remarkable and depressing fact that more than 1 in 10 patients are victimized by “basic errors,” leading to 5.2 percent of deaths.

The largest and most detailed survey into hospital deaths has revealed that almost 12,000 patients are needlessly dying every year as a result of poor patient care. The researchers from The London School of Hygiene and Tropical Medicine based the study on 1,000 deaths at 10 NHS trusts during 2009. The study revealed that basic errors were made in more than one in 10 cases, leading to 5.2% of deaths, which was the equivalent of nearly 12,000 preventable deaths in hospitals in England every year. The research published in the British Medical Journal’s Quality and Safety publication found that errors occurred when hospital staff made an incorrect diagnosis, prescribed the wrong drugs, failed to monitor a patient’s condition or react when a patient deteriorated. Errors in omission were more frequent than active mistakes. The majority of patients who died were elderly suffering with multiple health conditions, but the study found that some patients whose deaths were preventable were aged in their 30s and 40s.

Now let’s look at healthcare – if you use the term loosely – at one Government-run hospital. The UK-based Telegraph has the stomach-turning details.

Hundreds of hospital patients died needlessly. In the wards, people lay starving, thirsty and in soiled bedclothes, buzzers droning hopelessly as their cries for help went ignored. Some received the wrong medication; some, none at all.Over 139 days, the public inquiry into the Stafford hospital scandal has heard testimony from scores of witnesses about how an institution which was supposed to care for the most vulnerable instead became a place of danger. Decisions about which patients to treat were left to receptionists…and nurses switched off equipment because they did not know how to use it. …patients were left so dehydrated that some began drinking from flower vases. By the time the hospital’s failings were exposed by regulators, in 2009, up to 1,200 patients had died needlessly between 2005 and 2008. …on the wards, patients – most of them elderly – were left in agony and screaming for pain relief, as their loved ones desperately begged for help. The human toll was dreadful. In the course of 18 months, one family lost four members, including a newborn baby girl, after a catalogue of failings by the hospital. …Patients were left without medication, food and drink, and left on commodes. Basic hygiene was neglected: a woman was left unwashed for the last four weeks of her life. Relatives tried to keep their loved ones clean, scrubbing down beds and furniture and even bringing in clean linen. One consultant described how amid the chaos, it seemed at though nurses became “immune to the sound of pain”.

It’s disturbing to read something like this, but can you imagine the horror of having a sick child in one of these wretched British institutions?

I’m not saying there aren’t mistakes and instances of sub-standard care in U.S. hospitals. I’m sure that’s the case. And regular readers know that I’ve complained about the absurd government-caused inefficiency of the American healthcare system.

The point I’m making is that horror stories are more common from the U.K. because the entire system is a bureaucracy. The nurses and doctors on that side of the Atlantic are akin to clerks at the Postal Service and DMV on this side of the Atlantic.

P.S. If you want more horror stories about government-run healthcare in the United Kingdom click here, here, here, here, here, here, here, here, here, here, here, here, here and here.

P.P.S. And to close on an upbeat note, click here to learn how we can save America’s healthcare system.

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The Sadistic Brutality of England’s Government-Run Healthcare

I’m not easily grossed out or nauseated. Heck, I’m on email lists for a half-dozen softball teams and you can only imagine the strange/filthy/nasty things that guys send to each other.

But I read a story about the death panels in the United Kingdom that left me discombobulated. I can’t even begin to describe how I feel.

Here’s the intro of a disturbing report in the Daily Mail.

Sick children are being discharged from NHS hospitals to die at home or in hospices on controversial ‘death pathways’. Until now, end of life regime the Liverpool Care Pathway was thought to have involved only elderly and terminally-ill adults. But the Mail can reveal the practice of withdrawing food and fluid by tube is being used on young patients as well as severely disabled newborn babies.

And here are some of the horrifying details. Read at your own risk.

One doctor has admitted starving and dehydrating ten babies to death in the neonatal unit of one hospital alone. Writing in a leading medical journal, the physician revealed the process can take an average of ten days during which a  baby becomes ‘smaller and shrunken’. The LCP – on which 130,000 elderly and terminally-ill adult patients die each year – is now the subject of an independent inquiry ordered by ministers. …Earlier this month, an un-named doctor wrote of the agony of watching the protracted deaths of babies. …‘I know, as they cannot, the unique horror of witnessing a child become smaller and shrunken, as the only route out of a life that has become excruciating to the patient or to the parents who love their baby.’ …Bernadette Lloyd, a hospice paediatric nurse, has written to the Cabinet Office and the Department of Health to criticise the use of death pathways for children. She said: ‘The parents feel coerced, at a very traumatic time, into agreeing that this is correct for their child whom they are told by doctors has only has a few days to live. It is very difficult to predict death. I have seen a “reasonable” number of children recover after being taken off the pathway. …‘I have also seen children die in terrible thirst because fluids are withdrawn from them until they die. ‘I witnessed a 14 year-old boy with cancer die with his tongue stuck to the roof of his mouth when doctors refused to give him liquids by tube. His death was agonising for him, and for us nurses to watch. This is euthanasia by the backdoor.’

My first reaction is to hope that this story is wildly wrong, filled with exaggerations and lies.

My second reaction (and this is why I got so agitated) is to imagine what it must be like for the parents. They get talked into letting their kids die, which must be agonizing, and then (assuming they stick around) they have to watch them slowly starve to death or die of thirst. Wouldn’t it be better to just give your kid a fatal injection? Setting aside the moral issue of deciding to let a kid die because he’s disabled or something like that, doesn’t simple decency mean that death should be painless rather than agonizing?

My final reaction is to wonder what Paul Krugman would say about this scandalous neglect and mistreatment. During the Obamacare debate, he told us we could ignore stories about what was happening across the ocean, writing that “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.” So I guess starving children don’t qualify as a scare story.

P.S. If you want more horror stories about government-run healthcare in the United Kingdom click here, here, here, here, here, here, here, here, here, here, here, here, here and here.

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Must-Watch Video From Reason TV on How Free Markets – not Obamacare – Can Solve the Healthcare Mess

When I travel, particularly overseas, I run into a lot of people who are totally confused about the American healthcare system.

For all intents and purposes, they think the United States relies on the free market and that government (at least in the pre-Obamacare era) was largely absent.

So they are baffled when I tell them that nearly one-half of all health expenditures in America are directly financed by taxpayers  and that the supposedly private part of our healthcare system is massively distorted by government interference and intervention.

When explaining how government has screwed up private health insurance, I talk about third-party payer and  how genuinely private insurance works for home ownership and automobiles. And I cite examples of genuine free markets for cosmetic surgery and even (regardless of your views) abortion.

But from now on, I think I will simply tell people to watch this superb video from Reason TV.

This shows how a true free market operates. Efficiency and low prices are the norm, and consumers get a good deal.

My only quibble is that the video doesn’t explain how government policies – such as the healthcare exclusion in the tax code – should be blamed for the grotesque waste, inefficiency, and featherbedding in most parts of the medical industry.

But that’s a minor gripe. You should share this post with any and all fuzzy-headed friends and colleagues and tell them this is how smoothly the market would work if the government simply would get out of the way.

And if they want another example, here’s a report from North Carolina on free-market healthcare in action.

If we want this kind of system to be the rule rather than the exception, we need to scrap the healthcare exclusion in the tax code as part of a switch to a simple and fair flat tax. That will help bring some rationality to the health insurance market and address the part of the third-party payer crisis caused by indirect government intervention.

Then we also should reform Medicaid and Medicare to help address the part of the third-party payer crisis caused by the direct government intervention.

P.S. As this poster cleverly illustrates (and as Ronald Reagan correctly warned in the second video of this post), government is the problem, not the solution.

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Rewarding Hospitals to Let Old People Die? That’s the Wrong Way to Cut Government Spending

I used to think I was in favor of every possible step to reduce the burden of government spending.

• Are agricultural subsidies wasteful and corrupt? Yes, so get rid of the Department of Agriculture.
• Is Medicaid spending out of control? Yes, so cap outlay growth and block grant the program to the states.
• Has NATO outlived its usefulness? Yes, so let’s save money and bring troops home from Europe.

But I confess I’ve come across a budget-cutting strategy that even I can’t support. And it’s not in the area of national defense or public safety, which even I agree are legitimate functions of government.

Instead, I’m talking about the government-run healthcare system in the United Kingdom, which apparently is bribing hospitals to make greater use of the “Liverpool Care Pathway,” which is the UK version of a death panel. Here are some jaw-dropping excerpts from the Daily Mail.

Hospitals are paid millions to hit targets for the number of patients who die on the Liverpool Care Pathway, the Mail can reveal. The incentives have been paid to hospitals that ensure a set percentage of patients who die on their wards have been put on the controversial regime. In some cases, hospitals have been set targets that between a third and two thirds of all the deaths should be on the LCP, which critics say is a way of hastening the deaths of terminally ill patients. At least £30million in extra money from taxpayers is estimated to have been handed to hospitals over the past three years to achieve these goals. Critics of the method warned last night that financial incentives for hospitals could influence the work of doctors.

Here’s some additional info of how the program works.

The use of CQUIN payments to encourage the spread of the LCP through the wards and to persuade doctors to meet Pathway targets was revealed in answers to Freedom of Information requests. Among trusts that confirmed the use of targets was Aintree University Hospitals NHS Foundation Trust, which said that in the financial year which ended in March the percentage of patients who died on the Pathway was ’43 per cent against a target of 35 per cent’. Over the year the Trust received £308,000 for achieving ‘goals involving the Liverpool Care Pathway’. Salford Royal NHS Foundation Trust had CQUIN payments connected to the Liverpool Care Pathway almost halved after failing to reach targets.

Somebody should ask Paul Krugman about this horrific story. Even if the occasionally overly sensational British press is exaggerating and the real story is only half as bad as these excerpts, this is a nightmare. And it definitely shows that Krugman was wrong in 2009 when he wrote that, “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.”

Unless, of course, proponents of bigger government don’t think bribing hospitals to hasten death qualifies as a “scare story.” In that case, I’ll give them credit for being consistent, but only if the political elite has to live (or, in this case, die) by the same set of rules.

For some reason, though, I don’t think the Paul Krugmans, David Camerons, and Gordon Browns or the world will be subjected to the same treatment as the rest of us peasants.

And that’s also an issue with Obamacare. When push comes to shove, I strongly suspect the politically well connected somehow will avoid any of the headaches that are bound to result from that costly legislation.

If rationing is going to happen, I’d rather it be the result of markets rather than connections.

P.S. Other horror stories about the UK health system can be perused here, here, here, here, here, here, here, here, here, here, here, here and here.

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The Deadly Impact of Government-Run Healthcare in the United Kingdom

I’m not a fan of the American healthcare system. It suffers from huge inefficiencies because of problems such as third-party payer, which is caused by government programs such as Medicare and Medicaid along with a system of tax code-driven over-insurance in the supposedly private sector.

But regardless of how much I grouse about the damage government causes in the United States, I can say with considerable confidence that the government-run system in the United Kingdom has even larger problems.

Here are some of the shocking details from a report in the UK-based Daily Mail.

Patients having major surgery in NHS hospitals face a much higher risk of dying than those in America, research has revealed. Doctors found that people who have treatment here are four times more likely to die than US citizens undergoing similar operations. The most seriously ill NHS patients were seven times more likely to die than their American counterparts. Experts blame the British fatality figures on a shortage of specialists and lack of intensive care beds for post-operative recovery. They also suggest that long waiting lists mean diseases are more advanced before they are treated. Researchers from University College London and Columbia University, in New York, studied 1,000 surgery patients at the Mount Sinai Hospital, Manhattan, and compared them to nearly 1,100 people who had similar operations at the Queen Alexandra Hospital, in Portsmouth. The results showed that just under ten per cent of British patients died in hospital afterwards compared to 2.5 per cent in America. Among the most seriously ill cases there was a seven-fold difference in the death rates.

Here are some additional findings.

Professor Monty Mythen, head of anaesthesia at University College London and Great Ormond Street Hospital, said: “In America, after surgery, everyone would go into a critical care bed in a highly-monitored environment. That doesn’t happen routinely in the UK. …Prof Mythen said waiting lists in the NHS would “put patients at greater risk”. He added: “We would be suspicious that the diseases would be more advanced simply because the waiting lists (in the UK) are longer.”

Since I’m in London right now, I guess the moral of the story is to stay healthy.

On a slightly more serious note, I wish I had this story in front of me when I was guest-hosting Larry Kudow’s show a couple of years ago and my lefty British co-host got all agitated when I said the British system was worse for patients.

I think I saw this guy at the Paddington tube station this morning

And on a completely serious note, the point of this post is not to say the United States has a perfect system. I hope that’s obvious from my opening paragraph. And nor am I asserting that the UK system is universally bad. In my limited understanding, British doctors and nurses do a fairly good job with basic medicine and emergency medicine.

But any system is likely to deteriorate and suffer adverse effects as government takes a larger role. I’ve had fun over the past few years with anecdotal horror stories about government-run healthcare in the United Kingdom. But as you can see from all the links in this post, I sometimes share those just for the enjoyment of mocking Paul Krugman.

The academic study linked above is far more important if you want to assess the damage of giving politicians and bureaucrats even more control over healthcare.

That’s actually a good rule for just about everything. As shown in this poster, if you ever think the answer is more government, you’ve asked the wrong question.

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Another British Healthcare Horror Story, but It’s “False” According to Paul Krugman

Paul Krugman assured us back in 2009 that, “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.”

If that’s the case, then the British press is filled with liars who deliberately make up horror stories about their nation’s healthcare system, as you can see here, here, here, here, here, here, here, here, here, here, here and here.

We now have another nightmare to add to this list. Here are some of the horrific details from the UK-based Daily Mail.

An elderly woman died alone after doctors failed to tell relatives they were ending her life on the controversial Liverpool Care Pathway. Olive Goom, 85, passed away with no one by her side after medics neglected to consult with her family about her treatment at Chelsea and Westminster Hospital. …As Miss Goom lay dying alone, staff reassured relatives on the phone just hours before her death that there was no urgent need to visit – even though doctors had already removed tubes providing vital food and fluids. Her family discovered that she had died only when her niece went to visit her and found she was already being prepared for the mortuary. They said last night that they will never be able to stop feeling guilty that no one was there in her final hours. The Mail has been contacted by several families who claim that relatives were put on the Liverpool Care Pathway – the controversial system designed to ease the suffering of the dying in their final hours – without any consultation. Some said they found out that their relatives were on the pathway only after they happened to read their medical notes; and by that time it was too late.

Keep in mind, by the way, that the Liverpool Care Pathway is sort of akin to the IPAB “death panel” in Obamacare.

Defenders of government-run healthcare say that’s nonsense and assert that there won’t be any rationing, denial of care, or requirements for euthanasia. That’s technically true, but the Obamacare death panel will be determining what’s an acceptable treatment and what’s the government-approved payment schedule.

Crushed by Obamacare?

So it’s sort of like holding a rock in your hand, standing over a kitten, letting go of the rock, watching it hit the kitten, but then claiming that you did nothing wrong because gravity caused the rock to fall.

Okay, that’s a morbid example, but you get the point. And my concern isn’t that rationing only exists with a government-run system. Any healthcare system will involve rationing. The real issue is whether individuals are part of a free society so they can make the choice of how to ration.

(h/t: Ben Domenech)

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The Federalism Solution to the Medicaid Nightmare

This election season has seen lots of talk (and demagoguery) about whether investors, entrepreneurs, and small business owners should be hit with class-warfare tax policy.

And there’s also been lots of sturm and drang about the best way of averting bankruptcy for Medicare, which is the federal government’s health care program for the elderly.

But there’s been surprisingly little discussion so far about the issue of Medicaid, which is the federal government’s health program for poor people.

I’m not prone to optimism, but I can’t help but wonder if this is because even statists grudgingly accept that the program needs to be reformed.

If so, the right approach is block-granting the program back to the states. Here’s some of what Paul Howard and Russell Sykes had to say about the issue in the Wall Street Journal.

Medicaid, America’s safety-net program for more than 62 million low-income uninsured Americans, is broken. It’s broken at the state level, where program costs are swamping state budgets. It’s broken for federal taxpayers, as Medicaid waste, fraud and abuse drain tens of billions of dollars from federal coffers every year. …The best hope for Medicaid reforms that can improve care for low-income enrollees, reduce fraud, and put the program on a sustainable trajectory is to cap federal spending to the states by using block grants. Block grants would offer states a predictable source of federal funding in return for broad state flexibility in Medicaid administration, benefits and copays.

Howard and Sykes explain that the federalism approach already has been tried with welfare reform, which was very successful.

We know that well-designed block grants can work and attract bipartisan support. The best example is the successful 1996 Temporary Assistance for Needy Families program for welfare reform, which helped move millions of women and children out of poverty and into the workforce. Critics of Medicaid block grants argue that they would leave insufficient funds to cover new state expenses, creating a “race to the bottom” as states slashed funding on services for the poor. But such objections were also raised about block-granting welfare, and they turned out to be wrong.

They also reveal some very useful and interesting information about a test program in Rhode Island that shows the benefits of shifting health care decisions to the state level.

In 2009, Rhode Island accepted a five-year cap on combined state and federal Medicaid spending as part of a waiver from the federal government. ..To date, Rhode Island projects that by various new measures—focusing on community-based care that keeps seniors out of expensive nursing homes, for instance, and medical supervision that can keep children and adults out of emergency rooms—the state has saved $100 million. The flexibility to plan care has also helped reduce its projected Medicaid spending rate to 3% from 8% annually.

It’s worth noting, by the way, that Rhode Island is a very left-leaning state. Indeed, one of the reasons why I’m semi-optimistic about Medicaid reform is that governors and state legislatures – regardless of partisan affiliation – know that the current Medicaid system is unsustainable.

For more information, here’s my video explaining why block grants and federalism are the right way of dealing with Medicaid.

Since I’m not used to being optimistic, let me also give you a nightmare scenario for how this issue could evolve. My greatest fear is that a future president (perhaps Romney!) will decide to impose a value-added tax. In normal circumstances, that might upset state politicians since it would complicate their efforts to impose sales taxes.

But if a future President promised to have the federal government take over 100 percent of Medicaid financing, I suspect state politicians would jump at the trade.

So we would get the worst of all worlds. A giant new tax and more centralization.

P.S. Here’s the full three-part video series on entitlement reform.

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Maybe It Is Possible to Reform Health Entitlements

I’m never guilty of being an optimist, but two items caught my attention today that suggest the tide may be turning on entitlement reform.

We’ll start with something from the New York Times.

Regular readers know that I’ve criticized that paper on a few occasions.

Sometimes it’s because of silly editorializing, such as this bit of amateur political analysis by Thomas Friedman, this foolish look at international taxation by the editors, and this laughable column arguing that America should copy Italy’s fiscal policy.

I also hit them for ignorant reporting, such as the story implying that things are free when they’re financed by government, this column that inadvertently makes the opposite point from what was intended, and this story mis-characterizing tax reform.

Paul Krugman, needless to say, is in a league of his own. I’ll just cite this beatdown about Estonia and leave it at that.

But it’s also important to cite good journalism when it occurs, and a new story in the New York Times on healthcare is a prime example. It’s straightforward and unbiased. And it shows the benefits of even small steps in the direction of markets. Here’s some of what Robert Pear wrote.

Even as President Obama accuses Mitt Romney and Representative Paul D. Ryan of trying to privatize and “voucherize” Medicare, his administration crows about the success of private health plans in delivering prescription drug benefits and other services to Medicare beneficiaries. More than a quarter of the 50 million beneficiaries receive coverage through private Medicare Advantage plans, mostly health maintenance organizations, and Medicare’s drug benefits are delivered exclusively by private insurers, subsidized by the government. …“Medicare Advantage premiums down 7 percent on average, enrollment up 10 percent,” the administration announced in February, and it said the quality of care under Medicare Advantage was improving. This month the administration reported the results of competitive bidding for 2013: “Medicare prescription drug premiums to remain steady for third straight year.” Federal spending on Medicare drug benefits has been about 30 percent lower than the Congressional Budget Office predicted when the drug legislation was passed in 2003. Mr. Ryan, a Wisconsin Republican who is the chairman of the House Budget Committee, said the drug program “came in below cost projections because it harnessed the power of choice and competition.”

Pear’s article raises an interesting issue about incremental reform. Proponents of liberty and markets obviously don’t like government-financed healthcare, but there are very-bad ways of doing the wrong thing and there are less-bad ways of doing the wrong thing.

That’s never an argument for doing something bad, but if bad policies already are implemented, then it does make sense to grab any opportunity to make those policies less destructive.

Ideally, we should restore free markets overnight. But given the constraints of the political system, I’ll gladly take the modest reforms that Paul Ryan is proposing for Medicare and Medicaid.

Here’s a back-on-the-envelope image I created to show the spectrum of healthcare policy. It’s obviously very simplified, but I think the overall point about Ryan’s reforms being very incremental is correct.

One final point about the political implications. President Obama clearly wants to scare seniors into thinking that the Ryan reforms are radical, but this is why the New York Times article is significant. It shows that Ryan isn’t proposing anything unusual, and it shows that the incremental reforms being proposed have a successful track record.

This may be why we’re now seeing some remarkable poll results.

Despite a furious onslaught of negative ads and harsh rhetoric, neither President Obama nor Mitt Romney has much of an advantage on critical issues heading into the fall campaign. …On Medicare — long considered a political vulnerability for Romney and his running-mate Paul Ryan — 49 percent of likely voters say Obama would handle the issue better while 48 percent prefer Romney. On health care, voters are just as divided — with 49 percent favoring Obama’s policies and 48 percent favoring Romney.

P.S. Since I’m favorably commenting on an article from the New York Times, allow me to remind you that the paper does publish good material every so often. They allowed this great column on tax sovereignty on their editorial pages, this powerful expose of IRS abuse by a business columnist, and this great graphic on the connection between big banks and government bailouts in Europe.

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In Addition to Its Many other Flaws, Obamacare Is Becoming a Racket for Overpaid Government Bureaucrats

I’ve certainly complained about Obamacare from a fiscal perspective, warning that it means higher taxes and more spending.

And I’ve also warned that it will make our health care system less efficient and could lead to some of the horrifying examples of rationing and poor care that you find in the United Kingdom (scroll to the bottom of this post for some shocking examples).

But if you need another reason to be upset, it turns out that Obamacare is going to be a very lucrative gig for a new crop of government bureaucrats.

Here are some very disturbing details from the Pueblo Chieftan in Colorado.

Eye-popping salaries proposed for employees of the health benefits exchange being formed in Colorado grabbed the attention of Republicans and Democrats alike on Thursday. A subcommittee of the board charged with establishing the exchange  is considering a draft budget for its federal grant application that would create 24 positions and pay those employees a total of more than $3 million annually to manage the health care cooperative. The average annual salary of a health benefits exchange employee would exceed $125,000 under the plan. …“We have executive directors (of state departments) that are in charge of thousands of people here that make significantly less than that,” said Sen. Bill Cadman, R-Colorado Springs. …A Democrat on the committee overseeing enactment of health benefits exchange legislation in the state agreed that the figures are worthy of scrutiny. …Under the health care overhaul, states were required to establish exchanges. Colorado authorized its exchange this year in SB200.

Keep in mind that the $125,000 figure is an average, which means many of the bureaucrats will be getting much bigger paychecks.

“Obamacare is a great racket!”

And also remember that we’re talking Colorado, not someplace like New York City where the cost of living is a bit higher.

Even more important, the article refers to the “average annual salary,” which means it probably doesn’t include the gold-plated benefit packages that are far more generous than generally available in the private sector (state and local bureaucrats, for instance, make out like bandits on pensions).

And to show that this story is just the tip of the iceberg, let’s recycle my video about overpaid government bureaucrats.

And if all the data in the video doesn’t convince you, check out this chart.

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Repealing Obamacare Won’t Solve the Healthcare Mess (but It’s a Good Start)

I’ve often complained that government-created third-party payer is the main problem with America’s healthcare system, and I was making that point well before Obamacare was imposed upon the country.

Simply stated, people won’t be smart consumers and providers won’t compete to keep costs low when the vast majority of expenses are paid for either by government programs or by insurance companies.

That’s why I want to see reforms to Medicare and Medicaid, not only to save money for taxpayers, but also because that’s one of the steps that is needed if we want market forces to bring down the cost of healthcare.

And I want to see a flat tax, not only for the pro-growth impact of lower tax rates, but also because it gets rid of the internal revenue code’s healthcare exclusion, thus ending the distortion that encourages over-insurance.

With all that in mind, I’m obviously a big fan of this new video from the Center for Freedom and Prosperity.

Narrated by Julie Borowski from FreedomWorks, the video explains that third-party payer has been a growing problem for decades and that it would have required fixing even if the Supreme Court hadn’t botched the Obamacare decision.

And now that we’re stuck with Obamacare, at least temporarily, it’s more important than ever to deal with this underlying problem.

P.S. This new video expands upon the analysis provided in a previous CF&P video.

P.P.S. Setting aside the debate about whether it’s right or wrong, the abortion market also is an interesting case study of how prices don’t rise when consumers pay out of pocket.

P.P.P.S. Government-created third-party payer also is screwing up the market for higher education.

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An Amusing Look at Taxes, Penalties, Obamacare, and the IRS

I recently posted a bunch of cartoons about the Supreme Court’s shameful Obamacare decision (which was terrible, but probably not as awful as the Kelo decision).

Most of those cartoons, as well as the ones I posted here, focused on how Chief Justice Roberts put politics above the Constitution, but let’s return today to the broader issue of why Obamacare is bad news.

Let’s start with this cartoon, which deals with the pointless and irrelevant debate about whether the Obamacare enforcement mechanism is a tax or a penalty.

What we do know (and what we knew back when Obamacare was being debated) is that the IRS will be in charge of enforcement, which is what makes this next cartoon funny – albeit in a painful way.

Returning to the debate about taxes or penalties, this cartoon will be very painful for GOP partisans.

Very appropriate, since this cartoon from back in 2011 shows that there is no meaningful difference between the two plans.

And this also explains why I’m still predicting an Obama victory in November, even though his economic record is awful.

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More Obamacare Cartoons for the July 4th Holiday

I posted five good Obamacare cartoons last week (and included two others in this post and this post), and was planning on stopping there.

But the cartoonists have come out with a lot of good material, so let’s enjoy this new material. After all, we deserve a few laughs before we deal with the pain of more spending and higher taxes.

Let’s start with my favorite, which is very appropriate for today.

Sticking with that theme, here’s one that uses the Constitution instead of the Declaration of Independence.

Here’s one that should be in this same group. It’s very good as is, but I would have replaced the Tea Party flag with either the Constitution or Declaration of Independence (yes, I’m becoming an armchair cartoonist, as you can see here and here)

Since the last two cartoons have mocked Chief Justice Roberts, let’s continue with that theme.

By the way, I can’t resist adding a bit of what Thomas Sowell just wrote.

…there are people in Washington — too often, Republicans — who start living in the Beltway atmosphere, and start forgetting those hundreds of millions of Americans beyond the Beltway who trusted them to do right by them, to use their wisdom instead of their cleverness. …ObamaCare was an unprecedented extension of federal power over the lives of 300 million Americans… These are the people that Chief Justice Roberts betrayed when he declared constitutional something that is nowhere authorized in the Constitution of the United States. …What he did was betray his oath to be faithful to the Constitution of the United States.

Powerful, but accurate.

Now let’s go with the theme of mocking Both Roberts and Nancy Pelosi.

She’s an easy target, having become infamous for utterly inane comments, so let’s pile on with another.

Now let’s look at another good cartoon, but this one should worry us because it shows the door that Roberts opened.

This seems over the top, but 15 years from now, we’ll look back at this cartoon with better (and bitter) understanding.

Last but not least, here’s a cartoon that should worry Republican readers.

I’ve already explained why Mitt Romney is not a proponent of liberty. This cartoon underscores that sentiment and also shows why he will have a problem going after Obama on this issue.

But that’s a depressing way to end this post, so put all the statists out of your mind. Go out and enjoy the 4th, ideally with some illegal fireworks to show that the spirit of rebellion still exists.

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The Joy of Government-Run Healthcare: The UK’s Gilded Bureaucrats and Dying Patients

I’m not sure whether this is a post about America’s dismal future if Obamacare is allowed to take root or whether this is a post about bureaucrats ripping off taxpayers.

But I do know that it shows that the insiders take care of themselves quite nicely when the government seizes more control of a nation’s healthcare sector.

Here’s a report from the UK-based Telegraph about how bureaucrats at a Scottish branch of the National Health Service are bilking taxpayers.

National Procurement, a branch of the NHS National Services Division, arranged for staff who are deemed to be “regular users” of cars for business to get the cars through a taxpayer-backed vehicle-leasing scheme. …Figures provided by National Procurement in response to a Freedom of Information request showed that…one in eight members of staff, had used the 4x4s and convertibles to drive to work. Much of the insurance, petrol, road tax and leasing is funded by the state.

And we’re not talking cheap automobiles. Keep in mind, when you read this next passage, that £25,000 is almost $40,000.

One employee was leased a £27,000 Mercedes, while three other workers have been driving £23,000 S-line Audi A3 sports cars. Another employee received a £28,300 Audi TT. Since the beginning of this year, five new cars have been leased to staff, including a four-door BMW worth more than £30,500. Other leased vehicles include another Audi sports car worth more than £25,000 and three Range Rover Evoques costing up to £29,500.

So how do they work this scam? Simple, they take needless trips.

…staff have had to clock up a minimum of 5000 business miles during office hours to qualify for the scheme. …A department source told the Herald newspaper that some members of staff were using their leased cars for 80-mile round trips between National Procurement’s two offices, in Larkhall, Lanarkshire, and South Gyle in Edinburgh, even though there are adequate video conferencing facilities at both locations.

One hopes that this scandal in a Scottish branch is an exception and that most bureaucrats don’t behave in a similarly reprehensible fashion.

But given the bloated size of the National Health Service bureaucracy, it’s more likely that this is just the tip of the iceberg.

There is an entitlement culture in most government bureaucracies, and I would be shocked in the paper pushers and memo writers hadn’t figured out how to manipulate the system

And since there are more than 1.6 million of them, the magnitude of the fraud is presumably enormous.

The obvious follow-up question is whether taxpayers in the United Kingdom are getting some good value from this army of cosseted bureaucrats?

Unfortunately, that’s not the case. Here are some chilling excerpts from a story in the Daily Mail.

NHS doctors are prematurely ending the lives of thousands of elderly hospital patients because they are difficult to manage or to free up beds, a senior consultant claimed yesterday. Professor Patrick Pullicino said doctors had turned the use of a controversial ‘death pathway’ into the equivalent of euthanasia… There are around 450,000 deaths in Britain each year of people who are in hospital or under NHS care. Around 29 per cent – 130,000 – are of patients who were on the LCP. Professor Pullicino claimed that far too often elderly patients who could live longer are placed on the LCP and it had now become an ‘assisted death pathway rather than a care pathway’.

Here are a couple of horrifying examples.

Professor Pullicino revealed he had personally intervened to take a patient off the LCP who went on to be successfully treated. He said this showed that claims they had hours or days left are ‘palpably false’. In the example he revealed a 71-year-old who was admitted to hospital suffering from pneumonia and epilepsy was put on the LCP by a covering doctor on a weekend shift. Professor Pullicino said he had returned to work after a weekend to find the patient unresponsive and his family upset because they had not agreed to place him on the LCP. ‘I removed the patient from the LCP despite significant resistance,’ he said. ‘His seizures came under control and four weeks later he was discharged home to his family,’ he said.

In other words, government-run healthcare in the United Kingdom is a great scam if you’re an insider. But not such a good deal if you’re someone who needs, well, healthcare.

Sort of makes you wonder what Paul Krugman was thinking when he wrote, “In Britain, the government itself runs the hospitals and employs the doctors. We’ve all heard scare stories about how that works in practice; these stories are false.”

I guess the English newspapers are making up stories to denigrate their own nation. If you want to see more of these “false” stories, click here, here, here, here, here, here, here, here, here, here and here.

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Obamacare’s Corrupt Conception, Sleazy Gestation, and Tawdry Birth

One of my very first blog posts was about the link between big government and big corruption.

For the rest of my life, I can now cite the Obamacare travesty as an example.

Here’s some of what Tim Carney wrote for the Washington Examiner.

Chief Justice John Roberts’ judicial sleight of hand, transforming Obamacare’s mandate into a tax, was a fittingly twisted save for a law of such grisly provenance. Born of tawdry liaisons between industry lobbyists and political hacks, passed through naked logrolling and legislative skullduggery, Obamacare wasn’t finalized until Thursday, when the chief justice, in effect, amended the bill so that it would become constitutional.

Tim recounts some of the sleaze and corruption that allowed Obamacare to move through Congress.

…within weeks of his inauguration, Obama started playing the game. An early Obamacare confab was held at the headquarters of the Democratic Senatorial Campaign Committee — showing how this was a political exercise as much as a policy one. At this April 2009 meeting, top lobbyists from the drug industry and White House Deputy Chief of Staff Jim Messina hammered out a deal — exposed by recently released emails — whereby the drug industry would pay for pro-Obamacare ads basically written by the White House. Big Pharma would also spend big to re-elect Democrats who voted for the bill. …The Senate bill was authored mostly by Finance Committee Chairman Max Baucus and Majority Leader Harry Reid, probably the two senators most notoriously cozy with lobbyists. To win over wavering Democrats, Reid loaded the bill up with special favors. Nebraska’s Ben Nelson got the “Cornhusker Kickback,” and Reid bought Mary Landrieu’s vote with the “Louisiana Purchase” — both deals giving those states extra Medicaid money. … Democratic staffers who wrote the bill cashed out to K Street nearly immediately, becoming health industry lobbyists. Democratic Reps. Bart Stupak and Earl Pomeroy, who both lost their seats (Stupak retired, Pomeroy was defeated) thanks to their votes for Obamacare, were also rewarded with lobbying gigs for health care companies.

The combination of a politically motivated Chief Justice and a tawdry legislative process led Tim to this conclusion.

If this is how a bill becomes a law, our kids are going to need new civics textbooks.

Since this is a very depressing topic, we need to add some levity. I already did a post with several good Obamacare cartoons, but I can’t resist adding this one.

Returning to our unpleasant topic, Richard Epstein opined last Friday in the New York Times about the Obamacare decision and explained (as I noted last week as well) that the power to tax does not create a power to spend.

By giving Congress independent powers over taxation and other revenue sources, the Constitution ended that dependency. But as a quid pro quo, the Constitution also restricted the use of these revenues to classical public goods — benefits that must be given to all citizens, if given to any — like paying off national debts and paying for the nation’s defense. General welfare, mentioned in parallel with these two phrases, is best read as covering only matters that advance the welfare of the United States as a whole. The redistribution of income, or “transfer payments” among citizens, like those mandated under the Affordable Care Act, doesn’t qualify for taxation in this originalist reading of the Constitution. Through the early 20th century, the Supreme Court was cognizant of this tight relationship between the power to regulate an activity directly and to the power to tax it. The basic idea relies on a simple economic insight: taxation and regulation are close substitutes, so a limitation on one power matters little if the other power is still available. There is no practical difference between ordering an action, and taxing or fining people who don’t do that same thing. If the Constitution limits direct federal powers, it must also limit Congress’s indirect power of taxation.

Unfortunately, Supreme Court Justices sometimes don’t care what the Constitution says.

P.S. This is the second time the Obamacare Frankenstein monster has appeared on this blog. He was with his twin brother last time.

P.P.S. This is a post about the unseemly genesis of Obamacare, but I’m a fiscal policy wonk, so I want to remind everyone that this new entitlement will be a budget buster.

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Cartoons about the Supreme Court’s Obamacare Decision: Laughing in the Face of Tragedy

I’ve already thrown in my two cents on yesterday’s disappointing decision, and I was planning on ignoring the issue for a few days because I’m so irked by the result.

But they say laughter is an effective part of grief therapy, so let’s take some solace in these cartoons.

This first one is about the very serious issue of increased authority and power for the IRS.

Technically, the Supreme Court decision didn’t give the IRS any more power than it already had been given under the legislation, but the cartoon isn’t claiming otherwise, so it gets points for being accurate and (tragically) amusing.

By the way, here’s a cartoon making a similar point from back in 2010 when Obamcare was being debated.

Next we have a cartoon about Chief Justice Roberts and his new BFF status with Obama. I almost didn’t include it because Roberts deserves nothing but scorn, but I don’t want my feelings to interfere.

Speaking of Roberts, this next cartoon is accurate in many ways.

It’s designed to blame Bush for appointing a Justice who would put establishment approval before fealty to the Constitution, but I think it’s also true because Obama might not have won – and the Democrats certainly wouldn’t have picked up so many seats in the House and Senate – if Bush had not imposed so much statist legislation and weakened the economy, thus paving the way for big Democrat victories in 2006 and 2008.

And here’s a cartoon making the obvious point that Obama prevaricated.

I’ve saved my favorite for last, showing how the Supreme Court botched its responsibility.

But even though it’s my favorite of the five cartoons, I would make a change (just like I suggested alterations to a very good Chuck Asay cartoon back in April).

In this case, I also would amend this gem by replacing “economy” with “Constitution.”

I hope all these cartoons make you feel a bit better. If not, you can look at some R-rated Obamacare humor here, here, and here. And, just for the heck of it, here’s a PG-rated Obamacare joke to end on a more subdued note.

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Yes, the Federal Government Has a Broad Power to Tax, but that’s Different from Having a Green Light to Spend

I’m not a lawyer, or an expert on the Constitution, though I sometimes play one on TV.

But I can read, and I’ll agree with my friends on the left that the federal government has a broad power to tax. I wish the 16th Amendment had never been ratified, but its language gives the federal government a green light to rape and pillage.

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

That being said, the power to tax is not the same as the power to spend. And at the risk of sounding old fashioned, my big objection to the Obamacare decision is that health care is not listed as one of the federal government’s enumerated powers in Article I, Section VIII of the Constitution.

Sadly, that horse got out of the barn many decades ago, culminating in a horrible 1942 Supreme Court decision that said a man couldn’t grow crops on his own land to feed his own animals for consumption by his own family.

But let’s look at the bright side. Even though the Obamacare case was decided incorrectly, at least the judiciary is beginning to reconsider these issues, thanks in large part to the work of the Cato Institute’s legal scholars and adjunct legal scholars.

P.S. While the federal government has a broad power to tax, I should add that this doesn’t – or at least shouldn’t – vitiate other provisions of the Constitution. This is why it is so disappointing that we’ve seen the erosion of key civil liberties such as the presumption of innocence and the 4th Amendment’s protection against unreasonable searches and seizures.

P.P.S. This Michael Ramirez cartoon about Obamacare and the Constitution is amusing, though that’s not much solace given what happened. And here’s another one of his cartoons, this one on the broader theme of Obama vs. the Founding Fathers.

P.P.S. Speaking of cartoons, this one seems especially appropriate today.

If you like that one, you can see another Breen cartoon here.

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It’s My Birthday and I Want a Constitutional Present from the Supreme Court

I was born 54 years ago in the People’s Republic of New York.

Back then, all I wanted was a new baseball glove

But I don’t mention that because I want you to send me a present or to say Happy Birthday.

Instead, I’m hoping at least five of the Justices on the Supreme Court will make this day special by rejecting Obamacare.

And I mean the entire legislation, not just the mandate. I want them to throw out all the new taxes, all the new spending, all the new subsidies, and all the new market distortions.

My video on Obamacare, for instance, completely focused on how the legislation would expand the burden of government. The mandate is a bad idea, without question, but it’s also a big mistake to impose more spending and taxes when government already is far too big.

I’m worried, though, that the Court will reject the mandate and decide the rest of the law is okay. Not only does this mean we’ll be stuck with bigger government, but it also creates a scenario where politicians – including squeamish Republicans – may decide to enact other bad laws.

John Stossel shares my concerns about what may happen after a Supreme Court decision.

I’m scared. I fear that even if the Supreme Court overrules most of Obamacare (or did already, by the time you read this), Republicans will join Democrats in restoring “good” parts of the law…parts of Obamacare are popular. People like getting what they think is free stuff.

John elaborates, noting that politicians may enact laws that destroy the insurance market.

…discrimination is what makes insurance work. An insurance regime where everyone pays the same amount is called “community rating.” That sounds fair. No more cruel discrimination against the obese or people with cancer. But community rating is as destructive as ordering flood insurance companies to charge me nothing extra to insure my very vulnerable beach house, or ordering car insurance companies to charge Lindsay Lohan no more than they charge you. Such one-size-fits-all rules take away insurance companies’ best tool: risk-based pricing. Risk-based pricing encourages us to take better care of ourselves. Car insurance works because companies reward good drivers and charge the Lindsay Lohans more. If the state forces insurance companies to stop discriminating, that kills the business model. No-discrimination insurance isn’t insurance. It’s welfare. If the politicians’ plan was to create another government welfare program, they ought to own up to that instead of hiding the cost.

And since big business has a dismaying habit of getting into bed with big government, John isn’t expecting the insurance industry to defend markets.

Women go to the doctor more often than men and spend more on medicines. Their lifetime medical costs are much higher, and so it makes all the sense in the world to charge women higher premiums. But Sen. John Kerry pandered, saying, “The disparity between women and men in the individual insurance market is just plain wrong, and it has to change!” The industry caved. The president of its trade group, Karen M. Ignagni, said that disparities “should be eliminated.” Caving was safer than fighting the president and Congress, and caving seemed to provide the industry with benefits. Insurance companies wouldn’t have to work as hard. They wouldn’t have to carefully analyze risk. They’d be partners with government — fat and lazy, another sleepy bureaucracy feeding off the welfare state. Alcoholics, drug addicts and the obese won’t have to pay any more than the rest of us. But this just kills off a useful part of insurance: encouraging healthy behavior. Charging heavy drinkers more for insurance gives them one more incentive to quit. “No-discrimination” pricing makes health care costs rise even faster.

I’ve repeatedly written that the only way to fix healthcare is to get rid of the government-created third-party payer problem.

Unfortunately, that will be very difficult precisely because people like the illusion that they don’t pay (even though they do bear the costs in the form of lower take-home wages and higher taxes).

So while I want a full-repeal birthday present from the Supreme Court, that will only provide fleeting happiness unless we solve the third-party payer problem caused by Medicare, Medicaid, tax distortions, and other forms of government intervention.

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The Legal Case Against Obamacare

I’ve narrated a video on the fiscal nightmare of Obamacare and written several times about the serious problem of government-caused third-party payer – including just as few days ago while nit-picking about an otherwise excellent column by Robert Samuelson (and I’ve even used the abortion market to make the point that prices don’t rise when consumers are spending their own money).

But, other than mocking E.J. Dionne’s sophomoric understanding of America’s political system and making a general point about how the judicial branch is supposed to protect us from untrammeled majoritarianism, I haven’t said much about the constitutional issues being discussed at the Supreme Court.

Simply stated, I’m not a lawyer or an expert on the Constitution, so I try not to pontificate too much where my knowledge is lacking. Fortunately, though, I can turn to others who are competent to discuss such matters, and this new Learn Liberty video is a great introduction to the key issue that the Justices must decide.

Seems pretty straightforward. For all intents and purposes, the Justices are being asked to decide whether the Founding Fathers were serious when the outlined the limited powers of the federal government.

Let’s all keep our fingers crossed that the Court will imminently announce that the entire law is unconstitutional.

P.S. The Learn Liberty videos are superb. Here’s one on protectionism and here’s another about how excessive federal spending is America’s real fiscal problem.

P.P.S. Just in case the Court makes the wrong decision, here’s some Obamacare humor to cheer you up, including one on a new medical device the Administration is introducing, a cartoon about the real impact of the new health system, an R-rated explanation of the difference between private health care and government health care, the White House’s new motto for Obamacare, and (ouch!) a look at vasectomies once the government is in charge.

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Disagreeing with a Critic of Obamacare

Writing for the Washington Post, Robert Samuelson has a column on “The Folly of Obamacare.” This piece criticizes the President’s signature achievement for many good reasons, including increased uncertainty, the negative impact on job creation, rising levels of red ink, and generational unfairness.

I agree with all those complaints, but then Samuelson makes another point that rubbed me the wrong way because he’s complaining about a symptom and overlooking the underlying problem. Here’s what he wrote.

Uncontrolled health spending is the U.S. system’s main problem — and the ACA makes it worse. Spiraling health costs crowd out other government programs and squeeze wage increases by diverting compensation dollars into employer-paid insurance. Because insured people use more health services than the uninsured, the ACA (covering an estimated 30 million more) raises spending. As for the ACA’s cost-control provisions, even the government’s own actuaries don’t believe they will do much. By their latest projection, total health spending — government and private — rises from 17.9 percent of the economy (gross domestic product) in 2010 to 19.6 percent in 2021. In 1980, health care was 9 percent of GDP.

I assume all his facts are correct, but Samuelson is missing the point. The reason we have “spiraling health costs” is because of something called third-party payer. As the chart shows, nearly 90 percent of health care costs in America are financed by someone other than the consumer. And when folks get to consume with other people’s money, they have very little reason to care about costs.

In my speeches, I frequently cite myself as an example. When my kids were small and it seemed like there was an earache or sore throat every other week, I was always at the pediatrician. But I never cared about the bill because I knew my employer-provided coverage limited the out-of-pocket amount I would pay.

The same is true for the tens of millions of other Americans with health plans provided by their employers, and it’s also true for the tens of millions of Americans who use Medicare, Medicaid, or some other government program.

By the way, this is why undoing Obamacare – either legislatively or through a Supreme Court decision – doesn’t solve the problem. Third-party payer was a huge problem even before the President made the problem a bit worse with his misguided scheme.

This video explains why free-market reform is necessary to solve the problem of third-party payer.

One final point is that there are parts of our health care system where consumers still pay out-of-pocket, and you shouldn’t be surprised to learn that those are areas – such as cosmetic surgery (or even abortion) – where costs are restrained and quality keeps rising.

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The Supreme Court’s Job Is to Protect Americans from Democracy

I have to give the Washington Post credit. It may have a bias for statism, but at least they have some diversity on the op-ed pages. Less than two months after E.J. Dionne wrote an embarrassing column showing he didn’t understand the difference between untrammeled majoritarianism and a constitutional republic, the Post publishes a terrific piece by George Will on the proper role of the Supreme Court.

Here’s some of what George Will wrote.

…a vast portion of life should be exempt from control by majorities. And when the political branches do not respect a capacious zone of private sovereignty, courts should police the zone’s borders. Otherwise, individuals’ self-governance of themselves is sacrificed to self-government understood merely as a prerogative of majorities. The Constitution is a companion of the Declaration of Independence and should be construed as an implementation of the Declaration’s premises, which include: Government exists not to confer rights but to “secure” preexisting rights; the fundamental rights concern the liberty of individuals, not the prerogatives of the collectivity — least of all when it acts to the detriment of individual liberty. Wilkinson cites Justice Oliver Wendell Holmes as a practitioner of admirable judicial modesty. But restraint needs a limiting principle, lest it become abdication. Holmes said: “If my fellow citizens want to go to Hell I will help them. It’s my job.” No, a judge’s job is to judge, which includes deciding whether majorities are misbehaving at the expense of individual liberty. …The Constitution is a document, one understood — as America’s greatest jurist, John Marshall, said — “chiefly from its words.” And those words are to be construed in the bright light cast by the Declaration. Wilkinson worries about judges causing “an ever-increasing displacement of democracy.” Also worrisome, however, is the displacement of liberty by democracy in the form of majorities indifferent or hostile to what the Declaration decrees — a spacious sphere of individual sovereignty.

I offered my two cents on this issue, rhetorically asking why the Founding Fathers would have bothered listing enumerated powers if the interstate commerce clause was designed to be a blank check for politicians in Washington.

But Thomas Sowell, as usual, wrote about the issue with greater eloquence and clarity.

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