Ted Cruz, PolitiFact, ObamaCare & Jobs

I have two posts up at Darwin’s Fool on ObamaCare’s impact on jobs. In one post, I critique Politifact’s ruling that GOP presidential candidate (and Iowa caucus winner) Sen. Ted Cruz (TX) is a liar for claiming that ObamaCare is a job-killer. An excerpt:

In their rush to label Ted Cruz a liar, PolitiFact ignored economic theory, ignored economic consensus, ignored problems with the evidence they had amassed, ignored that some of the evidence they collected supports Cruz, ignored reams of anecdotal evidence, and dismissed Congressional Budget Office projections based on nothing more than a subjective and arbitrary distinction PolitiFact themselves invented.

In the other post, I offer a compilation of media reports about employers who have eliminated jobs or switched to part-time hiring. 

President Obama’s FY2017 Budget

President Obama has released his budget for fiscal year 2017. The president’s spending and revenue proposals will be mainly dead on arrival on Capitol Hill, including his $3 trillion in proposed tax hikes.

So it is more interesting to look at the budget baseline, which presents projections assuming no changes in law going forward. Since Obama’s proposals will go nowhere in Congress, the baseline gives us a better picture of what the next president will face when he or she comes into office next year.

Under the baseline, fast-growing spending inflates the deficit from $616 billion this year to $1.4 trillion by 2026. As the deficits accumulate, federal debt held by the public will soar from $14 trillion this year to about $24 trillion by 2026.

If you stacked $24 trillion in $100 bills in a pile, it would stretch 16,000 miles high, or about the height of 150,000 Washington Monuments. Government debt—driven by deficit spending—is by far Washington’s largest monument.

Where is all the spending going? The chart below shows federal outlays divided into four pots, as a share of gross domestic product (GDP) from 1970 through to 2026, with projections under the baseline. The chart reveals that entitlement spending—driven by rapid growth in Social Security and health programs—will increasingly dominate the budget in coming years.

I suspect that entitlement spending will also dominate the next president’s tenure in office as it drives up debt to unprecedented and dangerous levels, although you wouldn’t know that from the campaign trail so far this year.

Andrew Coulson’s Legacy

Andrew J. Coulson was my friend and mentor in school choice policy. He was a good, principled, brilliant, and funny man whom I will miss deeply, along with many, many, others. Andrew was so much more than his work, but I’d like to focus here on that legacy he leaves behind for those who never had the pleasure of knowing him personally.

There is no one else beside Andrew Coulson that you must read to discover what reforms we need in education and why they will work. That is not hyperbole. There are many very sharp people who have contributed important thoughts on education reform, but you will get everything essential that you need from reading through Andrew’s collective works. I have a short list of links to material representing Andrew’s core ideas below. In the near future, his final project – a documentary series on the history and future of education – will be released and should be added as mandatory viewing.

All the way through Andrew’s illness, he continued work on his passion; bringing freedom and excellence to education and opportunities to children. I know he has made a huge difference already, but I hope even more people read and learn from Andrew after his passing. If you have even a fleeting interest in education reform, please do yourself a favor and read as much as you can by Andrew Coulson.

I was first introduced to Andrew in graduate school, about twelve years ago. I’d written an article for NRO on vouchers, playing off a West Wing episode to encourage conservatives and Republicans to provoke a wedge-issue fight for targeted vouchers and black voters. Someone working in the choice movement emailed to compliment me on the article, but gently suggested I might be missing some important concerns about school choice policy.

A Modest Proposal: To Stop War, Draft Congressional Staffers

Given all the recent controversy about whether Congress should require women to register for the draft (answer: no, Congress stop requiring anyone to register), over at Darwin’s Fool I offered an alternative proposal for all those who still think conscription would reduce unnecessary wars: 

The only argument for the draft for which I have any sympathy is one the anti-war Left offers. (Remember them? They existed briefly during the Bush years.) It is the idea that conscription might make Congress and the president less eager go to war, because it would impose more of the cost of war on influential middle- and upper-class voters…

If the goal is to make Congress feel the burdens of war, drafting congressional staff would be a more effective deterrent to war than general conscription.

Read the whole thing.

How Congress Can Remove Barriers to Affordable, Quality Telemedicine

Over at TimeCato adjunct scholar Shirley Svorny offers a proposal that GOP and Democratic presidential hopefuls would be wise to endorse:

Ted Cruz won Iowa’s Republican presidential caucus promising to repeal every word of Obamacare. When pressed for details, he said he would separate insurance from employment, expand the use of health savings accounts, and allow people to purchase insurance across state lines. These are good ideas, ones we’ve heard before. There are, however, a number of other policy initiatives worthy of attention, whether the Affordable Care Act is repealed or not. There’s one simple thing Congress could do that would expand access to high-quality care, especially for patients in rural areas, without costing taxpayers a dime.

Telemedicine providers [use] telecommunication to provide health care over distances [and] have made great strides in improving access to care for rural communities. Telemedicine allows quick access to specialists, as with stroke victims where time is of the essence. Video interactions are expected to replace a sizable chunk of face-to-face office visits.

But the current system of state licensing stands in the way of interstate practice. Physicians must maintain licenses in each state in which they treat patients. Congressional action to define the location of telemedicine services as the location of the physician would allow physicians to practice with a single license in multiple states. It would allow telemedicine to achieve its full potential.

Read the whole thing. Svorny explains this proposal at greater length in a forthcoming Cato policy analysis.

Obamacare’s Low Enrollment Numbers Also Show Why Exchange Coverage Will Get Worse

The Obama administration has released the numbers from the 2016 open enrollment period for Obamacare’s health insurance exchanges. The Congressional Budget Office had already downgraded its enrollment projection for 2016 from 21 million to 13 million. The news is actually just slightly worse: only 12.7 million enrollments, a number that is likely to shrink over the course of the year. Naturally, the administration declared success because enrollments exceeded the 10 million it had predicted back in October (thereby confirming speculation it had deliberately low-balled that prediction so it could later declare victory in spite of what it knew would be terrible enrollment numbers). Yet most observers overlooked what may be the worst news of all: evidence suggesting significant adverse selection in the Exchanges.

The administration reported that 70% of those who re-enrolled for 2016 shopped for a better plan, while 43% switched plans. The administration spun this as a positive, as evidence that Obamacare is expanding choice.

In reality, those numbers mean the vast majority of enrollees were dissatisfied enough with their Obamacare coverage to look for a better option , and a near-majority were so dissatisfied with their premiums or their coverage that they switched to what they hope will be a better plan. Most importantly, such widespread plan-switching is strong evidence of the type of adverse selection that is already eroding Obamacare’s promise to the sick , and could cause the exchanges to collapse.

Free Trade Is Good for the 99%

Here is a recent Bernie Sanders tweet: 

We need trade policies that work for the working families of our nation and not just the CEOs of large, multi-national corporations.

I agree. And that is why Bernie Sanders and other progressives should support free trade: Current U.S. tariff and trade policy is bad for poor working families.  Economist Ed Gresser has explained that import tariffs are the most regressive of our taxes: 

… Tariffs are highest on the goods important to the poor. The trade agreements and bills of the past 25 years have sharply cut tariffs on luxury products and industrial inputs. But domestic industrial lobbies have fought hard and usually successfully to keep tariffs on cheap consumer goods high. The result of these bills is that as a percentage of total revenue, tariffs are now lower than at any time since at least the 1950s and perhaps ever; but on a few products, most of all shoes and clothes, the tariff system has changed little since the 1960s.

Therefore, shoes and clothes make up only one-fifteenth of America’s merchandise imports, but bring in almost half of America’s annual tariff revenue. In comparison to other major expenses—education, transport, entertainment, and so on—these goods are relatively small expenses for middle-class and wealthy families, but very large expenses for poor families with children.

This is why tariffs now hit maids and secretaries harder than company vice presidents—the more the tariff system raises money from shoes and clothes, therefore, the more it becomes some thing like a large excise tax on necessities especially important to the poor. Its regressive nature is especially striking in comparison to other federal taxes. …

Getting rid of these regressive taxes should be a priority for anyone truly interested in helping the poor.