Slap a Warning Label on the CBO Scoring

Princeton classmate and über-economist Greg Mankiw cautions that the Congressional Budget Office numbers that Democrats are trumpeting do not withstand scrutiny.

There has been a lot of talk lately about the CBO scoring of the health bill.  Here is one thing people should understand about their numbers: When they estimate the budget impact of a bill like this, they assume the path of GDP is unchanged.

Recall that the bill raises taxes substantially.  Some of these tax hikes are the explicit tax increases on capital income to pay for the insurance subsidies.  Some of these tax hikes are the implicit marginal rate increases from the phase-out of the insurance subsidies as a person’s income rises.  Both of these would be expected to reduce GDP growth.

Greg is cogent and instructive as always, but I confess I was intrigued even more by the custom warning label he posted on his blog (shown above).  After downloading the JPEG file, on a hunch I Googled its filename, warninglabel.jpg, and sure enough, the top result was a Warning Label Generator with multiple customization options.

It’s disappointing that despite offering more than 40 alternatives, none of the icons have a financial theme.  So I settled for a health care theme, at right.

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The Fierce Urgency of “Demon Pass”

Megan McArdle (emphasis added):

But there is one thing of which I am nearly perfectly certain: If we pass this thing, no American politician, left or right, is going to cut any of these programs, or raise the broad-based taxes necessary to pay for them, without any compensating goodies to offer the public . . . until the crisis is almost upon us. I can think of no situation, other than impending crisis, in which such a thing has been done–and usually, as with Social Security, they have done just little enough to kick the problem down the road.  The idea that you pass a program of dubious sustainability because you can always make it sustainable later, seems borderline insane. I can’t think of a single major entitlement that has become more sustainable over time.  Why is this one supposed to be different?

I agree with everything except the word “borderline.”

Yuval Levin, on the latest CBO score:

All of the spending laid out by CBO yesterday (more than $2.4 trillion in the first decade of the program’s full operation) will certainly happen if the bill is enacted, but many of the offsets are very unlikely to happen. The bill would leave it to another president and Congress, in 2018, to impose a tax on “Cadillac” health-care plans — a tax whose definition of “Cadillac” would grow much more slowly than the cost of coverage, so that more and more people would be covered by it every year. Why should we expect a future Congress and president to make such a politically painful move if the present Congress and president won’t do it? It would also leave it to the next Congress to drastically cut physician pay in Medicare — even as today’s Congress refuses to make much more modest cuts, and so wants to pass a “doc fix” that will cost more than $300 billion. Simply everybody knows this cut won’t happen, and as the CBO (with its customary bureaucratic understatement) has put it: “the long-term budgetary impact could be quite different if key provisions of the bill were ultimately changed or not fully implemented.” This is not fiscal responsibility; it’s not even naïveté or self-delusion. It’s just plain dishonesty.

David Brooks:

But [Obama] has been so sucked into the system that now he stands by while House Speaker Nancy Pelosi talks about passing health care via “deem and pass” — a tricky legislative device in which things get passed without members having the honor or the guts to stand up and vote for it.

Deem and pass? Are you kidding me? Is this what the Revolutionary War was fought for? Is this what the boys on Normandy beach were trying to defend? Is this where we thought we would end up when Obama was speaking so beautifully in Iowa or promising to put away childish things?

Props to Tunku Varadarajan, apparently the first to say this maneuver sounds like “demon pass.”  It’s what we’ve come to.

House Offers Best Hope for Stopping Obamacare

While much of the discussion about health care has focused on the lack of 60 Democratic votes in the Senate, the House may pose an even bigger obstacle.  For legislative process geeks, John Podhoretz explains the coming maneuvers.  First the House has to pass the Senate bill, with the understanding that there would then be discussions on a second, “reconciliation” bill (normally just used for budget matters) that “fixes what’s wrong with the first bill.”

It appears that, in an effort to make this as easy as possible on the Senate, the House is now under pressure from the Senate and the White House to vote for the reconciliation bill before the Senate. At which point the Senate will take it up and ramrod through the second bill with 51 votes, Obama signs it, and there’s health-care.

This strategy requires the House not only to vote for a wildly unpopular bill once, but then to vote on its sequel almost immediately afterward. In other words, House members are going to be forced to cast two wildly unpopular, highly visible votes in succession, without anybody else taking the heat. And there is going to be deal-making and back-scratching and all manner of sleazy behavior to achieve it, all of which will just increase the public sense of a corrupt process that has ensnared Democrats just as corruption seemed to ensnare Republicans in 2006. All so the Senate can sneak it through. And the House has good reason not to trust that the Senate will hold to its part of the bargain. What if there is a colossal meltdown in public support just before the reconciliation vote? What if the Senate decides to change it a little and throws it all back into chaos again? What if House members were to cast two votes and there was no health care at the end of the process?

…Thus, the best hope of derailing health care will not derive from high motives – stopping this dreadful measure before it becomes law — but rather very low motives — sheer, panicked self-preservation on the part of Democratic pols hoping against hope to hold on in spite of the looming Republican wave.

And remember, the House only had a five-vote margin when it passed its own version of health care “reform” last year.

Disregard all the talk about the process being “broken.”  This is checks-and-balances as the Framers intended.  It’s supposed to be hard to pass sweeping legislation.

Lissenup, GOP: “Democrat” Is a Noun.
The Adjective is “Democratic”

These days I self-identify as a Republican, but some of my best friends are Democrats.  Actually, as a function of the town where I live, virtually all of my best friends are Democrats.

So on behalf of my friends and on behalf of simple civility, I hereby call on all Republicans everywhere to abandon the contemptuous use of “Democrat” as an adjective.  If you need a handy analogy to understand why references such as “Democrat leaders” or “the Democrat Party” are offensive, consider the difference between the phrases, “he’s a Jewish boy” and “he’s a Jew boy.”  Or, if the problem is not that you are obnoxious, but rather merely that you are ignorant, a quick glance at the party’s official homepage will confirm that the correct usage is “Democratic Party.”

I associate the misuse of the term with Bob Dole, who famously made an ill-received reference to “Democrat wars” in his vice presidential debate with Walter Mondale in 1976.  [Interestingly, Wikipedia’s lengthy entry tracing the ignoble history of “Democrat Party (phrase)” doesn’t mention Dole.  But I digress.]

All of this came to mind as I prepared to approvingly post a passage by Andrew McCarthy in The Corner, describing why he believes the Democrats will use unusual parliamentary tactics to force through a health care bill opposed by a majority of Americans.  My annoyance at the first few words below caused me to spin off on this lexicographic tangent:

In the Democrat leadership, we are not dealing with conventional politicians for whom the goal of being reelected is paramount and will rein in their radicalism. They want socialized medicine and all it entails about government control even more than they want to win elections. After all, if the party of government transforms the relationship between the citizen and the state, its power over our lives will be vast even in those cycles when it is not in the majority. This is about power, and there is more to power than winning elections, especially if you’ve calculated that your opposition does not have the gumption to dismantle your ballooning welfare state.

I admire McCarthy, and I note that earlier in the very same paragraph (before the bit I quoted), he properly uses the term “Democratic leadership.”  So I’m choosing to interpret this as a typo.

I also hope his analysis is incorrect, and that the desire for re-election will sway enough Democrats [note correct usage of noun form] to sink Obamacare.  But I fear he may be right.

OK, Now I’m Less Bored With Health Care Summit


I couldn’t be bothered to watch the seven-plus-hour health care summit yesterday (given my new full-time job and all), but I still care about the subject.  Count on the blogosphere and the punditocracy to plow through all the raw material and offer up the best bits.

Hat tip to Peter Wehner at Commentary for flagging a strong performance by GOP Rep. Paul Ryan of Wisconsin. The six-minute clip above is worth watching — Ryan offers a fact-based, forceful-yet-respectful explanation of the impossible economics of Obamacare.

Don’t have six minutes?  Here’s a transcript of Ryan’s remarks, via the Washington Post‘s very helpful, comprehensive library of transcripts from every speaker.  And if you don’t want to bother with the transcript, here’s a sample (emphasis mine):

Look, we agree on the problem here. And the problem is health inflation is driving us off of a fiscal cliff.

Mr. President, you said health care reform is budget reform. You’re right. We agree with that. Medicare, right now, has a $38 trillion unfunded liability. That’s $38 trillion in empty promises to my parents’ generation, our generation, our kids’ generation. Medicaid’s growing at 21 percent each year. It’s suffocating states’ budgets. It’s adding trillions in obligations that we have no means to pay for it. …

And if you take a look at the CBO analysis, analysis from your chief actuary, I think it’s very revealing. This bill does not control costs. This bill does not reduce deficits. Instead, this bill adds a new health care entitlement at a time when we have no idea how to pay for the entitlements we already have.

The one-minute clip below is also nice — via Did I Miss Something.  The unlikely pair of Arianna Huffington and George Will reach an agreement, of sorts, on the best tactical approach for Democrats now.

Health Care Summit? I’m Bored.

Doesn’t the debate on Obamacare seem so last week already? This morning I tried to force myself to pay attention to today’s steel-cage Kabuki match at the White House.  I got as far as the headlines on the Washington Post homepage (highlighting mine).

Just as a matter of politics, I fail to understand why the administration is so intent on enacting, during an election year, legislation that is so overwhelmingly unpopular.  David Brooks, who generally admires Obama, gives the gruesome numbers:

If you average the last 10 polls, 38 percent of voters support the reform plans and 53 percent oppose. Obama’s reform is more unpopular than Bill Clinton’s was as it died.

Brown Victory Should Spell an End to Obamacare

I guess we can’t call it the People’s Republic of Massachusetts any more.  At 52% to 47%, it wasn’t even particularly close.

Democrats in the House are stumbling over each other as they back away from the notion of approving the Senate-passed version of health care “reform” so that the Senate would not have to vote again.

Democratic pollster and operative Doug Schoen describes the result even more starkly than most Republicans (H/T: Contentions):

The defeat of Martha Coakley represents a complete repudiation of President Obama’s domestic agenda, going well beyond health care. Massachusetts voters made it clear tonight with the decisive victory they gave to Republican Scott Brown that they want and expect the administration to pursue a dramatically different approach.

Wow.  Unless the Obama administration starts veering sharply back toward the center, the mid-term election in November will be even more dramatic.

Health Care Debate Involves First Principles: Capitalism vs. Command Economy

Neo-neocon (owner of my favorite bloggish nom d’pixelle) explains the fundamental difference in world-view that underlies the highly partisan health care debate (link and emphasis added):

Americans on both left and right are unhappy with the current health care reform bills.

Neo-neocon

Neo-neocon

The left is upset because neither the House nor Senate version goes far enough towards putting government firmly in control of our medical decisions, with the goal of providing equal coverage for all no matter what the price. The right is upset because we see the bills’ provisions as unwarranted intrusions on our liberty that create a “right” where none existed before. We believe that reform would be better handled by fostering competition in the private sector rather than increasing government intervention in vital decisions that should remain between doctor and patient….

[E]mbedded in the second paragraph of this article is the most basic division between left and right, embodied in the phrases “providing equal coverage for all” and “unwarranted intrusion on our liberty.”

The first expresses the left’s push for equality of outcome, while the second speaks to the right’s concern with safeguarding liberty while providing equality of opportunity. Even if it were possible to put aside for a moment all the highly valid concerns about the way this bill has been advanced against the will of the American public — the lack of transparency, the fiscal fudging, the vote-buying, and the lies — this deep and primary philosophical difference between left and right would still remain.

The battle cry of the left is that “health care should be a right, not a privilege.”  This is brilliant framing — it sneakily implies that conservatives believe health care should be a privilege.

140px-CaduceusThe problem, of course, is that no health care system can provide every treatment for every person for every malady.  Health care expenditures have to be rationed, either by government, by the marketplace, or — as in our current system — by an imperfect combination of the two.

Thanks in large part to Joe Lieberman, the most pernicious element of the left’s health care agenda — the single-payer stalking horse known as the public “option” — has been eliminated from the current bill.  But the legislation still represents a massive shift of control, over one-sixth of the economy, from the marketplace to the government.  It’s a move in the wrong direction, and it will stifle competition and lead to higher, unsustainable costs.  (There still remains a faint hope that the reconciliation process between the House and Senate versions may scuttle the legislation altogether.)

You should read all of Neo’s article, but since you won’t, I’ll give away the ending.  Riffing on Churchill, she writes:

Our government has had to choose between liberty and social justice. They chose social justice. They will get neither.

A Disgraceful Vote for “Reform” in the Middle of the Night

slow_d16I was up with a touch of insomnia last night — this morning, technically — and realized the time was approaching for the Senate’s “historic” 1 a.m. vote to expand government control of the health care system.  So I tuned in to C-SPAN and caught the tail end of the run-up to the 60-40 vote that everyone knew was coming.

Clad in my jammies after a long full day of morning church, afternoon snow shoveling and evening blogging, I watched Senators in their suits and neckties make their post-midnight pitches, and I was impressed once again by Senate Minority Leader Mitch McConnell of Kentucky.  Here are some excerpts, laboriously transcribed by moi (McConnell’s remarks begin about 39 minutes into the video):

The bill we’re voting on tonight will impact every American.  It will shape the future of our country. It will determine whether our children can afford the nation they will inherit.  It is one of the most consequential votes any of us will ever take, and none of us take it lightly.

But make no mistake – if the people who wrote this bill were proud of it, they wouldn’t be forcing this vote in the dead of night.

He touched on the “cheap deals” that were cut to win the crucial 60th vote from Sen. Ben Nelson of Nebraska:

One state out of 50 – one state out of 50 – gets to expand Medicaid at no cost to itself,  while taxpayers in the other 49 states pick up the tab.  The same Senator that cut that deal secured another one that benefits a single insurance company – just one insurance company, in his state.

He reviewed the long history of bipartisan support for groundbreaking social welfare acts — Social Security, Medicare, Americans with Disabilities Act, all passed with large majorities.

“Americans believe that on issues of this importance, one party should never be allowed to force its will on the other half of the nation.  The proponents of this bill felt differently.  In a departure from history, Democratic leaders put together a bill so heavy with tax hikes, Medicare cuts and government intrusion, that in the end their biggest problem wasn’t convincing Republicans to support it, it was convincing the Democrats.

In the end, the price of passing this bill wasn’t achieving the reforms Americans were promised.  It was a blind call to make history, even if it was a historical mistake.  Which is exactly what this bill will be if it is passed.  Because in the end, this debate isn’t about differences between two parties.  It’s about a $2.3 trillion dollar, 2,733-page health care reform bill that does not reform health care, and in fact makes the price of it go up.

The impact of this vote will long outlive this long, frantic, snowy weekend in Washington.  Mark my words, this legislation will reshape our nation.  And Americans have already issued their verdict – they don’t want it! They don’t like this bill!  And they don’t like lawmakers playing games with their health care to obtain the votes they need to pass it.

Majority Leader Harry Reid followed McConnell, and on the theory that people will believe a lie if it is repeated often enough, stated “Everyone knows we’re here at one in the morning because of my friends on the other side of the aisle.”  Byron York stayed up late after the vote to debunk that:

But the fact is, there is no reason the Reid Amendment vote could not have been held at a more reasonable hour. One a.m. Monday was the earliest moment that Senate rules allowed a vote, but there is no rule keeping the Senate from voting at some time after 1 a.m. If Reid had scheduled the vote for, say, 11 a.m. Monday, that would have been fine. If he scheduled it for 4 p.m. Monday, or 10 a.m. Tuesday, that would have been fine, too. But Reid is determined to pass the national health care bill by Christmas, and to do so he has to get the cloture vote on his amendment done at the earliest moment. The timeline is Reid’s and Reid’s alone.

The final vote is now scheduled for 7 p.m. on Christmas Eve, when the Web Goddess and I will be dining with friends at their home and preparing for church.  As with Porkulus, the Democrats are pushing for action now now now now now because they know that the more people learn about the bill, the less popular it will be.

Democrats will likely pay a heavy price in the 2010 election — Harry Reid is particularly vulnerable. Why would they choose that reality to pass a highly unpopular health care bill?  Kim Strassel had the answer the other day:

So why the stubborn insistence on passing health reform? Think big. The liberal wing of the party—the Barney Franks, the David Obeys—are focused beyond November 2010, to the long-term political prize. They want a health-care program that inevitably leads to a value-added tax and a permanent welfare state. Big government then becomes fact, and another Ronald Reagan becomes impossible. See Continental Europe.

The entitlement crazes of the 1930s and 1960s also caused a backlash, but liberal Democrats know the programs of those periods survived. They are more than happy to sacrifice a few Blue Dogs, a Blanche Lincoln, a Michael Bennet, if they can expand government so that in the long run it benefits the party of government.

Hope (and Ammunition) for Opponents of Socialized Medicine

It seems clear after Saturday’s Senate vote that America will avoid the worst excesses of the various Democratic proposals to remake the health care system.  The Senate voted 60-39 to allow the debate to reach the Senate floor, but although the vote was a nominal victory for the Democrats, they had zero votes to spare as they (temporarily) averted a Republican filibuster.

In particular, while stalwart Independent ex-Democrat Joe Lieberman sided with the Democratic caucus on this procedural vote, he has made it clear he will join Republicans in blocking any bill that includes the single-payer stalking horse known as the “public option.”  A few Democrats have also signaled that the party cannot necessarily count on their votes on an actual bill, while I’ve seen no signs that any Republicans are likely to break ranks.

Thankfully, the public “option” appears to be dead.

But just in case it attempts to lurch zombie-like from the grave, I’m glad to see an increasing number of resources available making well-articulated arguments against the move toward socialized medicine.

The video at the top of this post is perhaps the best of four well-made films available at FreeMarketCure.com, a website “dedicated to correctly diagnosing the problems with the U.S. health care system and promoting solutions which preserve and extend individual liberty.”  Three of the films feature Canadians describing why America should not emulate Canada’s health care system, and the fourth examines the famous battle cry of  “45 million Americans without health care” and shows how it vastly overstates the problem.

The other health care system we’re told we should covet is the fully socialized European model.  Here, too, there is a helpful video, this time from the Center for Freedom and Prosperity,  titled “Don’t Copy Europe’s Mistakes: Less Government Is the Right Way to Fix Healthcare.”  (Hat tip: America on the Rocks.)

Another great resource, although a more cumbersome one, is James Taranto’s “Great Moments in Socialized Medicine” — a frequently recurring feature in his trenchant Best of the Web Today column on the Wall Street Journal‘s website.  These items cite news stories describing instances where the bureaucracy of the British health care system has impeded quality health care, and often are set up by Taranto’s trademark dry wit.  From an example last week:

If women are discouraged from getting mammograms, as a U.S. government panel recently advised, some will die, but at least others will be spared the discomfort of getting mammograms. There isn’t a similar upside to the following decision by Britain’s socialized medical system, described by London’s Daily Mail:

Liver cancer sufferers are being condemned to an early death by being denied a new drug on the Health Service, campaigners warn….

Each individual item could be dismissed as anecdotal evidence, but Taranto has posted dozens of such items, and the recurring drumbeat is quite effective.  It’s a pity that it’s so hard to find them.

Taranto is an important pioneer of the blogosphere — I’ve been reading his BotWT every weekday since before 9/11, and he continues to polish his craft.  Unfortunately, his site hasn’t kept up with innovations in blogging software.  His primitive format doesn’t even provide a way to link to individual items within his daily roundup, let alone make use of elementary organizational tools like tags, and the search function is highly unsatisfying.  But a jerry-rigged Google roundup of his columns that include “Great Moments” posts can be found here.

Rep. Artur Davis

Rep. Artur Davis

This is a bit of a tangent, but one last hopeful sign can be found in a particularly flagrant example of rhetorical over-reaching.  Jesse Jackson, who long ago squandered whatever moral authority he might once have had, last week said at a Congressional Black Caucus meeting, “You can’t vote against healthcare and call yourself a black man.”  This was a reference to a vote against Pelosi-care by Rep. Artur Davis of Alabama, who does call himself, and who from his photo appears to be, in fact, a black man.

If the increasingly desperate proponents of health care “reform” continue to serve up this type of poisonous rhetoric, it will only serve to stiffen the spines of Americans across the country who have been pressuring their representatives to tread carefully in remaking one-sixth of the economy.