Gonzales and the Constitution

Attorney General Alberto Gonzales presumably resigned because he had lost support in Congress, especially over issues relating to the firing of U.S. attorneys. But Tim Lynch, director of Cato’s Project on Criminal Justice, has long insisted that the real problem with Gonzales was not incompetence, faulty memory, or his confusing explanations of how the U.S. attorneys came to be dismissed. Rather, he wrote in May:

In area after area – from habeas corpus to separation of powers to executive responsibility – he has sought to strip out the limits that the Constitution places on presidential power. His fiasco regarding the firing of federal prosecutors is a petty offense when compared to the legal advice that he has conveyed to the President. The real scandal is his disregard for constitutional principles.

That’s why you have to appreciate Gonzales’s decision to resign effective September 17, Constitution Day. Maybe he wants to send a subtle signal that the end of his tenure could be an occasion to recover our commitment to constitutional limits on federal power and on presidential power.

Constitution Day is also, of course, famous as the day that the Cato Supreme Court Review is released at an all-day symposium on the Supreme Court’s most recent term.

The Blue Dog Fraud

Many of the newly-elected Democrats in the House of Representatives campaigned as fiscally conservative independents, but the Wall Street Journal reveals that these so-called blue-dog Democrats generally have been supporters of higher taxes and bigger government. Too bad these fiscal frauds aren’t more like the “Boll Weevil” Democrats, members of Congress who provided the margin of victory for many reforms to limit the burden of government during the Reagan years:

So far this year the blue dogs have been almost all bark when it comes to fiscal restraint and debt reduction. Thirty of the 48 have voted for every one of the non-defense spending bills their committee chairman have sent them. …28 of the 48 blue dogs voted “no” on each of the 27 amendments that Republicans proposed to cut the costs of these bills. …Voting records from recent years confirm that the blue dogs are less than consistent spending hawks. The National Taxpayers Union did some checking and found that the blue dogs had an average fiscal score of 24 out of 100, earning them a grade of D as a group. It also found that last year the blue dogs sponsored $145 of new spending for every dollar of budget reductions, for a net spending increase per member of more than $140 billion. The blue dogs are consistent on one fiscal issue: stopping tax cuts. As a group they opposed the Bush tax cuts and the extension of those tax cuts, and a super-majority vote requirement to raise taxes–all in the name of easing the debt burden on future generations. But those concerns evaporated when all but nine in the blue dog coalition voted to expand the Schip health-care program to include many middle-class families, at a cost of $132.6 billion over the 2008-2017 period.

Politics Today

The Washington Post reports today that John Edwards’s new strategy is to reposition himself as a “straight talker,” emulating the model that worked for John McCain in 2000. As someone said, “Sincerity is everything. If you can fake that, you’ve got it made.”

Meanwhile, the Post also tells us about the lifelong congressional insider who’s helping Barack Obama craft his image as a Washington outsider.

What a country. It reminds me of the presidential campaign manager who once told me, “We’ve made a tentative decision to run a bold campaign.”

The Privatization Revolution Reaches the Kibbutz

A fascinating headline in the New York Times today:

The Kibbutz Sheds Socialism and Gains Popularity  

It seems that one of the proudest accomplishments of socialism – one that never degenerated into totalitarianism! – the Israeli kibbutz, began to decline in the 1980s as even small-scale socialism proved not to work very well. People left the kibbutzim, and they seemed doomed. But now, as the Times puts it, “most are undergoing a process of privatization,” though just as in China and other reforming socialist societies, they prefer not to use such a word. Nevertheless, the Times says,

On most kibbutzim, food and laundry services are now privatized; on many, houses may be transferred to individual members, and newcomers can buy in. While the major assets of the kibbutzim are still collectively owned, the communities are now largely run by professional managers rather than by popular vote. And, most important, not everyone is paid the same.

Once again, people are lining up to get in.

One difference between libertarianism and socialism is that a libertarian society allows for voluntary experiments in socialism, while a socialist society can hardly accommodate people who prefer to live in a libertarian community. In a free society, if kibbutzim or other experiments in communal living can make a go of it, more power to them. And if the original design doesn’t quite work, then adjustments can be made. And the rest of us benefit by having more patterns and models available to choose from.

The Few, the Proud, the SiCKO Audience

This fun quote from the Kaiser Family Foundation, which polled the public regarding Michael Moore’s film SiCKO, just landed in my inbox:

“Our poll shows how the combination of good timing, a controversial director, and lots of free media attention can generate real impact for a film that very few people have actually seen,” said Kaiser President and CEO Drew E. Altman, Ph.D.

Talking Cancer with the Candidates

The Lance Armstrong Foundation will host forums for presidential candidates today and tomorrow in Cedar Rapids, Iowa. The forums, Democrats today, Republicans tomorrow, will focus, not surprisingly, on health care and the fight against cancer.

As a cancer survivor, this is an issue of great concern to me. Unfortunately, we can expect both the questions and answers to focus around more federal spending for research and the Democrats support for a government-run national health care system. I wish Chris Matthews, who will moderate this forum, would point out to them that cancer survival rates in the U.S. have been rising, and that one reason for this is the free-market health care system that these candidates love to criticize.

The one common characteristic of all national health care systems is that they ration care. Sometimes they ration it explicitly, denying certain types of treatment altogether. More often, they ration more indirectly, imposing global budgets or other cost constraints that limit the availability of high-tech medical equipment or imposes long waits on patients seeking treatment. In the U.S. there are no such limits, meaning that the most advanced treatment options are far more available. This translates directly into saved lives.

Take prostate cancer, which I suffered from, for example. In most countries with national health insurance, the preferred treatment for prostate cancer is…to do nothing. Prostate cancer is a slow moving disease. Most patients are older and will live for several years after diagnosis. Therefore it is not cost-effective in a world of socialized medicine to treat the disease too aggressively. The approach saves money, but comes at a more human cost.

Even though American men are more likely to be diagnosed with prostate cancer than their counterparts in other countries, we are less likely to die from the disease. Less than one out of five American men with prostate cancer will die from it, but 57 percent of British men and nearly half of French and German men will. Even in Canada, a quarter of men diagnosed with prostate cancer, die from the disease.

Similar results can be found for other forms of cancer. For instance, just 30 percent of U.S. citizens diagnosed with colon cancer die from it, compared to fully 74 percent in Britain, 62 percent in New Zealand, 58 percent in France, 57 percent in Germany, 53 percent in Australia, and 36 percent in Canada. Similarly, less than 25 percent of U.S. women die from breast cancer, but 46 percent of British women, 35 percent of French women, 31 percent of German women, 28 percent of Canadian women, 28 percent of Australian women, and 46 percent of women from New Zealand die from it.

Even when there is a desire to provide treatment, national health care systems often lack the resources to provide it. In Britain, for example, roughly 40 percent of cancer patients never get to see an oncology specialist. Delays in receiving treatment under Britain’s national health service are often so long that nearly 20 percent of colon cancer cases considered treatable when first diagnosed are incurable by the time treatment is finally offered.

But the advantages of free-market health care go far beyond an absence of rationing. With no price controls, free-market U.S. medicine provides the incentives that lead to innovation breakthroughs in new drugs and other medical technologies. U.S. companies have developed half of all the major new medicines introduced worldwide over the past 20 years. In fact, Americans played a key role in 80 percent of the most important medical advances of the past 30 years. Eighteen of the last 25 winners of the Nobel Prize in Medicine either are U.S. citizens or work here.

Obviously there are problems with the U.S health care system. I am sure we will hear plenty about that during these forums. But it is important to understand that for all its faults and all the criticism that it has received, the United States’ free market health care system has made it the place you want to be if you have a serious illness. Millions of cancer patients have discovered that. It would be nice if Lance Armstrong, Chris Matthews, and the candidates would stop to think about this.

Unfair Criticism of the Fair Tax

Regular readers know that I think the flat tax is the more astute tax reform option, but I admire the Fair Tax because it has the same pro-growth features as a flat tax (low tax rate, no double-taxation of saving and investment, no special loopholes, etc). As such, I feel compelled to offer a partial defense against Bruce Bartlett’s anti-Fair Tax column in the Wall Street Journal. Bruce notes some of the political obstacles to a national sales tax, and I largely agree with those observations, but Bruce also says that Fair Tax advocates are wrong to advertise the “tax-inclusive” rate. It is true that ordinary Americans think of “tax-exclusive” rates when looking at state sales taxes, but the Fair Tax people are seeking to compare their proposal to the current income tax, which is calculated on a “tax-inclusive” basis. So while it’s true that sales tax advocates should not let people assume that the Fair Tax is calculated the same way as a state sales tax, this does not mean the “tax-inclusive” rate is not an appropriate measure when looking to overhaul the tax code. Bruce also cites the revenue estimates of the Joint Committee on Taxation as if they were carved on stone tablets, but the JCT has a long track record of inaccurate predictions because of their assumption that tax policy has no affect on economic growth. Using the JCT as an authority is akin to letting the other side serve as both player and umpire:

In reality, the FairTax rate is not 23%. Messrs. Linder and Chambliss get this figure by calculating the tax as if it were already incorporated into the price of goods and services. (This is known as the tax-inclusive rate.) Calculating it the conventional way that every other sales tax is calculated, with the tax on top of the price, yields a rate of 30%. (This is called the tax-exclusive rate.) The distinction is confusing, but think of it this way. If a product costs $1 at retail, the FairTax adds 30%, for a total of $1.30. Since the 30-cent tax is 23% of $1.30, FairTax supporters say the rate is 23% rather than 30%. …professional revenue estimators have always concluded that a national retail sales tax would have to be much, much higher than 23%. A 2000 estimate by Congress’s Joint Committee on Taxation found the tax-inclusive rate would have to be 36% and the tax-exclusive rate would be 57%. In 2005, the U.S. Treasury Department calculated that a tax-exclusive rate of 34% would be needed just to replace the income tax, leaving the payroll tax in place. But if evasion were high then the rate might have to rise to 49%. If the FairTax were only able to cover the limited sales tax base of a typical state, then a rate of 64% would be required (89% with high evasion).