Tag: road to serfdom

NRO Op-ed: IPAB, ObamaCare’s Super-Legislature

Yesterday, Cato released “The Independent Payment Advisory Board: PPACA’s Anti-Constitutional and Authoritarian Super-Legislature,” by the Goldwater Institute’s Diane Cohen and me.

Today, National Review Online publishes our op-ed based on that study. An excerpt:

[U]nder the statute as written, if Congress fails to repeal IPAB in 2017, the secretary must implement IPAB’s edicts even if Congress votes to block them. Nancy Pelosi was right: We needed to pass ObamaCare to find out what was in it. We’re still finding out.

ObamaCare is so unconstitutional, it’s absurd. It delegates legislative powers that Congress cannot delegate. It creates a permanent super-legislature to supplement—and when conflicts arise, to supplant—Congress. It tries to amend the Constitution via statute rather than the amendment procedure of Article V.

ObamaCare proves economist Friedrich Hayek’s axiom that government direction of the economy threatens both democracy and freedom. After decades of failing to deliver high-quality, low-cost health care through Medicare, Congress struck upon the “solution” of creating a permanent super-legislature—or worse, an economic dictator—with the power to impose taxes and other laws that the people would reject.

Fortunately, one Congress cannot bind future Congresses by statute. If the Supreme Court fails to strike down ObamaCare, Congress should exercise its power to repeal IPAB—and the rest of ObamaCare with it.

Cohen is also the lead attorney for the plaintiffs in Coons v. Geithner, which challenges the constitutionality of IPAB and which a federal court has put on hold pending the Supreme Court’s ruling in the individual-mandate and Medicaid-mandate cases.

Why the Worst Get on Top

Susan Stamberg reports on Martha Gellhorn, “one of the first great female war correspondents,” whose marriage to Ernest Hemingway is being dramatized by HBO next week. Gellhorn had a healthy skepticism toward power:

In 1983, a British TV interviewer posed this loaded question to Gellhorn, then 75 and still gorgeous: “I.F. Stone once described governments as comprised entirely of liars and nothing they say should ever be believed.”

The response was a typical no-holds-barred Gellhorn opinion: “Quite right. And Tolstoy once said governments are a collection of men who do violence to the rest of us. Between Izzy Stone and Tolstoy, you’ve got it about right.”

The title of this post is of course a chapter title from Hayek’s The Road to Serfdom.

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Happy Birthday, F. A. Hayek

Today is the 113th anniversary of the birth of F. A. Hayek, perhaps the most subtle social thinker of the 20th century.

He was awarded the Nobel Prize in Economics in 1974. He met with President Reagan at the White House, and Margaret Thatcher banged The Constitution of Liberty on the table at Conservative headquarters and declared “This is what we believe.” Milton Friedman described him as “the most important social thinker of the 20th century,” and Lawrence H. Summers called him the author of “the single most important thing to learn from an economics course today.”

He is the hero of The Commanding Heights, the book and PBS series by Daniel Yergin and Joseph Stanislaw. His most popular book, The Road to Serfdom, has never gone out of print and sold 125,000 copies last year. John Cassidy wrote in the New Yorker that “on the biggest issue of all, the vitality of capitalism, he was vindicated to such an extent that it is hardly an exaggeration to refer to the 20th century as the Hayek century.”

Last year the Cato Institute invited Bruce Caldwell, Richard Epstein, and George Soros to discuss the new edition of The Constitution of Liberty, edited by Ronald Hamowy. In a report on that session, I concluded:

Hayek was not just an economist. He also published impressive works on political theory and psychology.

He’s like Marx, only right.

Cato published two original interviews with Hayek, in 1983 and 1984.

Find more on Hayek, including an original video lecture, at Libertarianism.org.

Inside Every Leftist Is a Little Authoritarian Dying to Get Out

I’ve been meaning to write about how ObamaCare’s unelected rationing board — innocuously titled the Independent Payment Advisory Board — is yet another example of the Left leading America down the road to serfdom.  (Efforts to limit political speech — innocuously called “campaign finance reform” — are another.)

As Friedrich Hayek explained in The Road to Serfdom (1944), when democracies allow government to direct economic activity, the inevitable failures lead to calls for a more authoritarian form of governance:

Parliaments come to be regarded as ineffective “talking shops,” unable or incompetent to carry out the tasks for which they have been chosen. The conviction grows that if efficient planning is to be done, the direction must be taken “out of politics” and placed in the hands of experts — permanent officials or independent autonomous bodies.

The problem is well known to socialists.  It will soon be half a century since the Webbs began to complain of “the increased incapacity of the House of Commons to cope with its work.”

Sound familiar?  National Review’s Rich Lowry picks up on the theme here.

Making this connection got a lot easier the other day when the University of Chicago’s Harold Pollack, a leading advocate of a “public option,” vented his frustrations over at The American Prospect blog about how Congress is likely to defang the Independent Payment Advisory Board. And he ends up just where Hayek predicted:

Despite many reasons for caution — the words George W. Bush foremost among them — I’m becoming more of a believer in an imperial presidency in domestic policy. Congress seems too screwed up and fragmented to address our most pressing problems.

This isn’t how it starts. This is how it snowballs.

Paging Dr. Hayek…

Good Point

In his recent book Ill Fares the Land, a passionate defense of the democratic socialist ideal, the historian Tony Judt writes that Hayek would have been (justly) doomed to obscurity if not for the financial difficulty experienced by the welfare state, which was exploited by conservatives like Margaret Thatcher and Ronald Reagan.

Yes, if Hayek had been wrong about the viability of the welfare state, then his warnings would have had less resonance.

This line appears in a generally thoughtful treatment of how The Road to Serfdom has stayed in print for decades and become a bestseller in the past two years. The article by Jennifer Schuessler appeared in the New York Times Book Review last July, but has only just come to my attention.

ObamaCare’s Threat to Free Speech

On Friday, I blogged about HHS Secretary Kathleen Sebelius’ letter to the health insurance lobby, in which she attempts to stifle political speech by using the new powers that ObamaCare grants her to threaten health insurance companies that claim ObamaCare’s coverage mandates are one cause behind rising premiums.  (Never mind that the insurers’ estimates – which project that ObamaCare will increase premiums in 2011 by as much as 9 percent – are in line with those put forward by HHS.)

Here’s a smattering of reactions from others.

  • The Wall Street Journal: “The Health and Human Services secretary…warned that ‘there will be zero tolerance for this type of misinformation and unjustified rate increases.’   Zero tolerance for expressing an opinion, or offering an explanation to policyholders? They’re more subtle than this in Caracas.”
  • Chicago Tribune: “President Obama’s health care reform plan, enacted in March, is not terribly popular with the American people…The administration can’t tell the public to stop grousing. It can, however, try to silence health insurers who have the nerve to say out loud what basic economic theory indicates…Apparently, harsh punishment is in store for anyone who refuses to parrot the administration line. But there is every reason to think this alleged libel is true.”
  • Tyler Cowen: “Nowhere is it stated that these rate hikes are against the law (even if you think they should be), nor can this ‘misinformation’ be against the law…[The letter] is worse than I had been expecting.”
  • Ed Morrissey: “Rarely have we heard a Cabinet official tell Americans to stay out of political debates at the risk of losing their businesses. It points out the danger in having government run industries and holding a position where politicians can actually destroy a business out of spite.”
  • Michael Barone: “Sebelius is threatening to put health insurers out of business in a substantial portion of the market if they state that Obamacare is boosting their costs…The threat to use government regulation to destroy or harm someone’s business because they disagree with government officials is thuggery. Like the Obama administration’s transfer of money from Chrysler bondholders to its political allies in the United Auto Workers, it is a form of gangster government.”
  • Eugene Volokh: “even if such action would be constitutionally permissible, it would be quite troubling, as would threats that seem to hint as such action: It would involve the Administration’s deliberately trying to suppress criticism of its policies, under a ‘misinformation’ standard that sounds highly subjective and politically contestable. (Consider [Sebelius’] reference ‘to our analysis and those of some industry and academic experts’ — what about the analysis of other industry and academic experts?) Perhaps I’m missing some important context here. But my first reaction is that this is ominous behavior on the Administration’s part, and seems to have both the intent and effect of suppressing criticism of the Administration’s policies — including criticism that simply expresses opinions the Administration dislikes, and makes estimates that it disagrees with, and not just criticism that contains objectively demonstrable ‘misinformation.’”

In The Wall Street Journal, economist Russ Roberts recently explained one of the main themes of Friedrich Hayek’s The Road to Serfdom:

When the state has the final say on the economy, the political opposition needs the permission of the state to act, speak, and write. Economic control becomes political control.

One need not agree with all of Hayek’s conclusions to see how ObamaCare is threatening political freedom.

Can We Be Both Up from Slavery and on the Road to Serfdom?

At Reason.com I argue that libertarians are wrong to look back at some point in the past for a golden age of liberty, and especially wrong to write paeans to the gloriously free 19th century without mentioning the little matter of 19 percent of Americans being held in chains.

For many libertarians, “the road to serfdom” is not just the title of a great book but also the window through which they see the world. We’re losing our freedom, year after year, they think….

Has there ever been a golden age of liberty? No, and there never will be. There will always be people who want to live their lives in peace, and there will always be people who want to exploit them or impose their own ideas on others. If we look at the long term—from a past that includes despotism, feudalism, absolutism, fascism, and communism—we’re clearly better off. When we look at our own country’s history—contrasting 2010 with 1776 or 1910 or 1950 or whatever—the story is less clear. We suffer under a lot of regulations and restrictions that our ancestors didn’t face.

But in 1776 black Americans were held in chattel slavery, and married women had no legal existence except as agents of their husbands. In 1910 and even 1950, blacks still suffered under the legal bonds of Jim Crow—and we all faced confiscatory tax rates throughout the postwar period.

I note that “I am particularly struck by libertarians and conservatives who celebrate the freedom of early America, and deplore our decline from those halcyon days, without bothering to mention the existence of slavery,” and I name a couple of examples. When we talk about how free Americans were in the 19th century, we should remember that many millions of Americans look back on those years and say

“My ancestors didn’t have the right to worship in their own way. My ancestors didn’t have the right to keep and bear arms. My ancestors didn’t have the protection of centuries-old legal procedures. My ancestors sure as heck didn’t have the right to keep what they produced, or to pursue an occupation of their choice, or to enter into mutually beneficial trades. In fact, my ancestors didn’t even have the minimal right of ‘the absence of physical constraint.’”

Read the whole thing.

Postscript: In late-breaking news after the Reason article was written, Gov. Robert McDonnell (R-VA) has issued a proclamation declaring April “Confederate History Month.” As politicians often do with news they’re not really publicizing, McDonnell posted the proclamation on his website Friday, but no one noticed until Tuesday. The proclamation urges Virginians to “understand the sacrifices of the Confederate leaders, soldiers and citizens during the period of the Civil War” but does not mention slavery. Virginia’s last Republican governor, in issuing a proclamation remembering the Civil War, had at least acknowledged reality:  ”The practice of slavery was an affront to man’s natural dignity, deprived African-Americans of their God given inalienable rights, degraded the human spirit and is abhorred and condemned by Virginians … Had there been no slavery, there would have been no war.” Amazingly, he was criticized for that simple and obvious statement, as was I when I quoted it a few years back.