Tag: job creation

Talk of Replacing ObamaCare Is a Bit Premature

Now that a bipartisan coalition in the House has voted to repeal ObamaCare, an even larger bipartisan coalition has approved a Republican resolution directing four House committees to “replace” that ill-fated law.  House Resolution 9 instructs the committees to “propos[e] changes to existing law” with the following goals:

  1. “Foster economic growth and private sector job creation by eliminating job-killing policies and regulations.”
  2. “Lower health care premiums through increased competition and choice.”
  3. “Preserve a patient’s ability to keep his or her health plan if he or she likes it.”
  4. “Provide people with pre-existing conditions access to affordable health coverage.”
  5. “Reform the medical liability system to reduce unnecessary and wasteful health care spending.”
  6. “Increase the number of insured Americans.”
  7. “Protect the doctor-patient relationship.”
  8. “Provide the States greater flexibility to administer Medicaid programs.”
  9. “Expand incentives to encourage personal responsibility for health care coverage and costs.”
  10. “Prohibit taxpayer funding of abortions and provide conscience protections for health care providers.”
  11. “Eliminate duplicative government programs and wasteful spending.”
  12. “Do not accelerate the insolvency of entitlement programs or increase the tax burden on Americans;” or
  13. “Enact a permanent fix to the flawed Medicare sustainable growth rate formula used to determine physician payments under title XVIII of the Social Security Act to preserve health care for the nation’s seniors and to provide a stable environment for physicians.”

Three things about the Republicans’ “replace” effort:

First, America’s health care sector has historically been handicapped by one political party committed to a policy of (mostly) benign neglect, and another party committed to degrading that sector’s performance through government subsidies, mandates, price controls, and other exchange controls.  Republicans now appear to be taking a different posture, and that’s encouraging — but not entirely.  When Republicans set their minds to reforming health care, they are often as bad as Democrats.  (See the Republican “alternatives” to ClintonCare.  Or Medicare Part D.  Or #4-#7 above.)  Exactly how House Republicans plan to deliver on the above goals remains to be seen.

Second, no matter how House Republicans plan to deliver on the above goals, their proposals will be preferable to ObamaCare.  Republicans quite literally could not do worse if they tried.

Third, no matter how good the Republicans’ proposals are, they will be utterly ineffective so long as ObamaCare remains on the books.  ObamaCare’s influence is so pervasive and harmful that it makes real health care reform all but impossible.

So it’s a bit premature to be talking about replacing ObamaCare.

Is National Journal Giving ObamaCare a Big, Wet Smooch?

Come September, National Journal will host a policy summit titled “Prescription For Growth,” funded by Eli Lilly, that will probe “the potential impact of recently passed health care reform as an economic engine” and ask whether “health care reform [will] serve as a jobs creator and accelerate growth in health-related industries?”

Oy, where to begin?

I suppose I could start with how a news organization that bills itself as “the leading source of nonpartisan reporting” could lend ObamaCare a positive gloss by calling it “reform” – a term that even NPR declines to ascribe to actual legislation (for that reason).

Next, there’s this inane question of whether ObamaCare will spur job growth in the health care sector.  With two new health care entitlements and maybe a trillion dollars of new health spending…gosh, d’ya think?

But then there’s the presumption that creating new health care jobs is a good thing.  You’d think it would be.  After all, unemployment is near 10 percent.  But one of our biggest health care problems is that there are too many health care jobs.  The Dartmouth Institute’s Elliot Fisher has quipped, “In theory, we could send a third of the U.S. health care workforce to Africa and improve the health of both continents.”  ObamaCare will just make this country’s health care sector even more bloated and inefficient.

Wrap your head around all that this summit aims to accomplish.  It could give a boost to an unpopular and embattled law by taking one of the law’s biggest liabilities and dressing it up as an asset.  It could create a meme that helps turn around President Obama’s low approval rating on the economy – never mind that ObamaCare is stifling the right kind of job creation.

Of course, I may have this summit all wrong.  It may give all these issues a fair hearing.

Did I mention the summit’s sponsor is one of the biggest special-interest beneficiaries of ObamaCare?  (Tim Carney, call your office.)

Political Economy in Three Panels

Indeed, every improved product or service may make us no longer value products and services we previously used. That’s what Schumpeter called “creative destruction.” A longer version of the same phenomenon was on the front page of Monday’s Wall Street Journal, in an article about how Wal-Mart’s rivals secretly fund “grassroots local campaigns” against Wal-Mart, organized by political consulting firms, to protect the existing firms’ positions. Every innovator puts somebody out of business, as Agnes’s friend recognizes.

Trade Gap Plunges in 2009, but Where Are the Jobs?

Lost in the buzz last week over health care was the news that the broadest measure of the U.S. trade deficit fell sharply in 2009 from the year before. According to the Bureau of Economic Analysis, the U.S. current account deficit plunged from $706 billion in 2008 to $420 billion last year – the smallest deficit since 2001.

I’ve been waiting for a few days now for the usual trade deficit hawks to hail this development as great news for millions of Americans looking for work.

In years when the trade deficit was rising, it was common practice for the labor-union-friendly Economic Policy Institute to publish detailed studies showing that larger trade deficits caused the U.S. economy to lose hundreds of thousands of jobs each year. For example, according to an October 2008 EPI paper, rising non-petroleum trade deficits from 2000 to 2006 caused a lost of 484,400 jobs per year, while the shrinking deficit in 2007 lead to the creation of 272,500 jobs.

By the EPI’s own internal logic, the past two years should have been a boom time for job creation. Between 2007 and 2009, the non-petroleum trade deficit dropped by $174 billion as the sagging domestic economy cut demand for impost. If that was good news for jobs, somebody forgot to tell the U.S. labor market. Since the end of 2007, the U.S. economy has shed a net 8 million jobs.

Oops, maybe it’s time for EPI to rework its model.

David Goldhill: “A Democrat’s Case For ‘No’ ”

David Goldhill has done it again.

You may recall his article, “How American Health Care Killed My Father,” from the September 2009 issue of The Atlantic.

Now, at HuffingtonPost, he comments on the health care legislation that may soon face a final vote (of some sort) in the House:

[C]ontinuing our Party’s almost unquestioned conflation of health insurance with health care, the central feature of the proposed “reform” is further extension of our flawed insurance-based system…[D]espite the Administration’s recent heated rhetoric, most of the entrenched health industry interests are quietly or openly in favor of this bill. Should the bill become law, I suspect we will look back at it as an industry bailout…

How…can Democrats in the depths of a recession support a massive tax increase on middle-class job creation…? How…could we justify diverting even more of middle class income to support our broken system of care, further starving families of funds for all their other needs? Most uninsured Americans lack insurance only temporarily; how many of them would trade lesser lifetime job prospects and lower disposable income for the short-term retention of health insurance?…

If the legislation had any real prospect of controlling health care spending, would the pharmaceutical industry be funding the “yes” campaign?

As a former Democrat who hung door knockers for Michael Dukakis in 1988, I know the heavy heart with which he writes.  Read the whole thing.

Watch the video to hear Goldhill’s story:

State of the Union Fact Check

Cato experts put some of President Obama’s core State of the Union claims to the test. Here’s what they found.

THE STIMULUS

Obama’s claim:

The plan that has made all of this possible, from the tax cuts to the jobs, is the Recovery Act. That’s right – the Recovery Act, also known as the Stimulus Bill. Economists on the left and the right say that this bill has helped saved jobs and avert disaster.

Back in reality: At the outset of the economic downturn, Cato ran an ad in the nation’s largest newspapers in which more than 300 economists (Nobel laureates among them) signed a statement saying a massive government spending package was among the worst available options. Since then, Cato economists have published dozens of op-eds in major news outlets poking holes in big-government solutions to both the financial system crisis and the flagging economy.

CUTTING TAXES

Obama’s claim:

Let me repeat: we cut taxes. We cut taxes for 95 percent of working families. We cut taxes for small businesses. We cut taxes for first-time homebuyers. We cut taxes for parents trying to care for their children. We cut taxes for 8 million Americans paying for college. As a result, millions of Americans had more to spend on gas, and food, and other necessities, all of which helped businesses keep more workers.

Back in reality: Cato Director of Tax Policy Studies Chris Edwards: “When the president says that he has ‘cut taxes’ for 95 percent of Americans, he fails to note that more than 40 percent of Americans pay no federal incomes taxes and the administration has simply increased subsidy checks to this group. Obama’s refundable tax credits are unearned subsidies, not tax cuts.”

Visit Cato’s Tax Policy Page for much more on this.

SPENDING FREEZE

Obama’s claim
:

Starting in 2011, we are prepared to freeze government spending for three years.

Back in reality: Edwards: “The president’s proposed spending freeze covers just 13 percent of the total federal budget, and indeed doesn’t limit the fastest growing components such as Medicare.

“A better idea is to cap growth in the entire federal budget including entitlement programs, which was essentially the idea behind the 1980s bipartisan Gramm-Rudman-Hollings law. The freeze also doesn’t cover the massive spending under the stimulus bill, most of which hasn’t occurred yet. Now that the economy is returning to growth, the president should both freeze spending and rescind the remainder of the planned stimulus.”

Plus, here’s why these promised freezes have never worked in the past and a chart illustrating the fallacy of Obama’s spending claims.

JOB CREATION

Obama’s claim:

Because of the steps we took, there are about two million Americans working right now who would otherwise be unemployed. 200,000 work in construction and clean energy. 300,000 are teachers and other education workers. Tens of thousands are cops, firefighters, correctional officers, and first responders. And we are on track to add another one and a half million jobs to this total by the end of the year.

Back in reality: Cato Policy Analyst Tad Dehaven: “Actually, the U.S. economy has lost 2.7 million jobs since the stimulus passed and 3.4 million total since Obama was elected. How he attributes any jobs gains to the stimulus is the fuzziest of fuzzy math. ‘Nuff said.”

Monday Links

  • Beware the “Crusader Temptation”: “Afghanistan has become a target of aggressive pro-war activists in America, including feminists who believe in waging war to improve the status of women.”