Archives: 07/2012

States Resist ObamaCare Implementation, Oklahoma Edition

The Washington Post reports:

The Supreme Court may have declared that the government can order Americans to get health insurance, but that doesn’t mean they’re going to sign up.

Nowhere is that more evident than Oklahoma, a conservative state with an independent streak and a disdain for the strong arm of government…

When it comes to health insurance, the effort to sign people up isn’t likely to get much help from the state. Antipathy toward President Obama’s signature health-care overhaul runs so deep that when the federal government awarded Oklahoma a large grant to plan for the new law, the governor turned away the money — all $54 million of it.

The idea that the federal government will persuade reluctant people here to get insurance elicited head-shaking chuckles at Cattlemen’s Steakhouse…

But some in Oklahoma aren’t so sure the population here will be easy to persuade, especially if the state government continues to condemn “Obamacare.”

“If we’re not being cooperative and all the rhetoric is hostile, then that’s going to be a real barrier to providing information to people,” said David Blatt, director of the Oklahoma Policy Institute, a state policy think tank. “There’s a lot of important outreach that needs to happen before January 1, 2014, and it’s going to be extremely difficult to do that when you have state leaders standing there saying, ‘Over our dead bodies.’ ”

Resistance remains strong in other states as well, with some governors promising to opt out of parts of the law.

Wait until states find out that they can block ObamaCare’s employer mandate just by refusing to create an Exchange.

20 Years and Counting: America’s Vicious Cycle of Intervention in Somalia

Yesterday, the L.A. Times revealed that the United States is equipping and training thousands of African soldiers to fight al-Shabab, the militant wing of the Islamist Somali government. For now, outsourcing the combat to African countries may appear to bring America minimal risk, but Washington’s renewal of its multi-decade attachment to Somalia continues a cycle of deciding its winners and losers. Among an assortment of tribes, clans, and African states fighting for self-serving ends, Washington has handcuffed itself to a hornet’s nest.

The hubris of policymakers who believe they can remedy Somalia’s problems could produce policies that draw more recruits to the cause of militant groups, much as similar policies have in the past. Policymakers have failed repeatedly to bring order to the destitute African state, such as when it descended into clan-based warfare in the early 1990s.

At the time, U.S. officials agreed to enforce a March 1993 U.N. resolution that pledged to rehabilitate Somalia’s economy and reestablish national and regional institutions. State Department official David Shinn spoke of “basically re-creating a country,” while then-U.N. ambassador Madeleine Albright said America’s mission in Somalia “aimed at nothing less than the restoration of an entire country as a proud, functioning and viable member of the community of nations.” The humanitarian mission eventually tasked America’s military with disarming Somali warlords and conducting house-to-house weapons searches. What began as U.S. leaders imbued with the best of intentions eventually ended with our brave military’s ignominious defeat.

Today, the United States fights al-Shabab by proxy. The group poses no direct threat to the security of the United States; however, exaggerated claims about the specter of al Qaeda could produce policy decisions that exacerbate a localized, regional problem into a global one. Amid news that African troops are doing the fighting, but that “The United States is doing almost everything else,” African Union forces could be seen as a puppet proxy of Uncle Sam.

Washington is supplementing the training of African troops with private contractors. Outsourcing makes intervention easier, as policymakers can hide the costs of a mission they have yet to clearly define. Intervention on the cheap also becomes costly in other ways. For a commander in chief who allegedly believes he should take moral responsibility for America’s lethal counterterrorism operations, privatizing intervention allows him and his administration to escape accountability should the forces we train, or the weapons we provide, turn against us or our allies.

Like moths to a flame, disparate Somali groups may rally around the perception they are fighting against the injustice of foreign meddling. Moreover, while military analysts were boasting back in June that al-Shabab could be facing the end of its once-powerful rule, questions surrounding what form of political stability will fill the al-Shabab vacuum remain unasked and unanswered.

The United States began fighting al-Shabab after December 2006, when Washington backed Ethiopia in toppling Somalia’s loose network of Islamist Sharia courts. The intervention backfired. The Islamist movement grew more powerful and today, U.S. officials fear al Qaeda could gain a foothold unless al-Shabab is defeated.

Sadly, America’s history of intervention in Somalia aptly demonstrates the resiliency of unintended consequences. Although developments in Somalia have some observers arguing that America should become more involved, the more reasonable conclusion to draw—looking at the historical record—is that America has tried and failed repeatedly to transform Somalia at an acceptable cost.

Note to Education Reporter: GDP Is HUGE, Just like Education Spending

Last week I testified before the Senate Appropriations subcommittee that deals with education. The topic was sequestration, and my case was, frankly, overwhelming, showing that education spending has ballooned for decades while achievement for 17-year-olds – our schools’ “final products” – hasn’t budged.

At least I thought it was overwhelming. But apparently a Huffington Post reporter was underwhelmed by it and wrote the following:

Some lobbyists in the education reform camp note that U.S. education spending has skyrocketed, while test scores have stagnated. Neal McCluskey – an expert witness who serves as associate director for the Cato Institute’s education center – took this line, but a recent report from the nonpartisan Center on Education Policy shows that education spending has actually not grown at all as a share of the gross domestic product.

Aside from the odious implication that I am either a lobbyist or take my cues from them, the big problem with this rebuttal is that it is flat-out wrong. Open the link to the CEP report, go to page 35, and there you will see that the share of GDP taken by elementary and secondary education in fact grew between 1999 and 2009, from 4.4 percent to 4.6 percent.

Perhaps the writer thinks a 0.2 percentage point uptick isn’t big enough to constitute growth. If so, she should really take a look at the Digest of Education Statistics table that furnished the GDP data. It reveals just how big a spending increase that seemingly dinky rise was, a function of GDP starting very large and growing  substantially. Indeed, there was an increase of over $237 billion, or a 57 percent ballooning, with spending rising from $413 billion in 1999 to $650 billion in 2009!

Those are current dollars so we should really adjust for inflation. Doing that moves the 1999 figure to $531 billion, but that still means there was a real increase of $119 billion, or a 22 percent move. That’s no growth by no means.

To her credit, the Huff Po reporter included one piece of context that’s crucial when discussing cuts to federal education spending, context that belies the irresponsible rhetoric of people like Education Secretary Arne Duncan, who said sequestration would “jeopardize our nation’s ability to develop and support an educated, skilled workforce that can compete in the global economy.”

Surely to justify such doomsaying cuts would have to be very large – perhaps 10 or 20 percent – right?

Nope. As Sen. Shelby (R-AL) rightly noted at the hearing – and the Huff Po reported – the 7.8 percent cut to federal education programs likely under sequestration would only translate into about a 0.84 percent cut in total education spending. Why? Because the Feds – though spending far too much on education – still only supply about 10.8 percent of the total. Most funding comes from state and local governments.

When you look honestly at the numbers there really is no question: Sequestration should fully include education.

‘Coverage Will Not Necessarily Translate into Care’

Members of the Anti-Universal Coverage Club already knew this. Members of the Church of Universal Coverage may want to take heed. The New York Times reports:

In the Inland Empire, an economically depressed region in Southern California, President Obama’s health care law is expected to extend insurance coverage to more than 300,000 people by 2014. But coverage will not necessarily translate into care: Local health experts doubt there will be enough doctors to meet the area’s needs. There are not enough now.

Other places around the country, including the Mississippi Delta, Detroit and suburban Phoenix, face similar problems…

Moreover, across the country, fewer than half of primary care clinicians were accepting new Medicaid patients as of 2008, making it hard for the poor to find care even when they are eligible for Medicaid. The expansion of Medicaid accounts for more than one-third of the overall growth in coverage in President Obama’s health care law.

But isn’t the important thing that they’ll have a piece of paper that says “health insurance”?

Police Use of Drones Leads to Arrest of North Dakota Farmer

From a Minneapolis Star-Tribune account last week:

…a Predator drone led to the arrests of farmer Rodney Brossart and five members of his family last year after a dispute over a neighbor’s six lost cows on his property escalated into a 16-hour standoff with police.

It is one of the first reported cases in the nation where an unmanned drone was used to assist in the arrest of a U.S. citizen on his own property…

Many more cases are likely to follow, in areas that include drug enforcement, child welfare and environmental regulation. Warns the ACLU in a report issued in December:

All the pieces appear to be lining up for the eventual introduction of routine aerial surveillance in American life – a development that would profoundly change the character of public life in the United States.

Lots of money is being made from drone (UAV) operations already, and those who are dubious about the privacy and Constitutional aspect of the trend can expect to run into comebacks like the following:

“If you’re concerned about it, maybe there’s a reason we should be flying over you, right?” said Douglas McDonald, the company’s director of special operations and president of a local chapter of the unmanned vehicle trade group.

Read the whole thing. The Fourth Amendment to the U.S. Constitution states:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Related on the surveillance state here. Cato Unbound published a symposium on drones in January which included discussion of their domestic implications.

Ten Years of Quack Corporate Governance

Ten years ago today, President Bush signed another one of his great bipartisan accomplishments, the Sarbanes-Oxley Act.  You may recall the failures of Enron and WorldCom, driven by accounting fraud and a stock market bubble.  A lot has been written on Sarbanes-Oxley or SOX as it’s known to its friends, such as Cato’s Corporate Aftershock.  I continue to believe that the most insightful analysis was that of Yale Law Professor Roberta Romano, who in the Yale Law Journal, described SOX as “Quack Corporate Governance”.

Professor Romano observed that despite Enron being the claimed rationale, the provisions of SOX bear “absolutely no relation to the source of that firm’s demise.”  In her more generous moments, Professor Romano notes that “with the scholarly literature at odds with the proposed governance mandates being treated as though it did not exist, the quality of decisionmaking that went into the SOX legislative process was, to put it mildly, less than optimal.”

As her long analysis repeatedly shows, there is a large academic literature, both empirical and theoretical, whose generally robust conclusions outright contradict the policies pushed by SOX. For instance, despite the obvious failings of the credit rating agencies, remember it was the short-sellers who first called attention to problems at Enron and WorldCom, not the regulators or the rating agencies, SOX absolutely fails in correcting these flaws, even after spilling considerable ink on the topic.  Had the rating agencies been reformed, the most recent financial crisis would likely have been smaller.

Perhaps more troubling should be the fact that some of the same Congressional staff authors of SOX, individuals whom I like personally and believe are well-intended, are the same people who drafted the Dodd-Frank Act.  It is unlikely a coincidence that much of Title IX of Dodd-Frank reads like it was directly lifted from SOX, but replacing “auditor” with “rating agency”.  Given the failure of SOX to even moderate the recent crisis, we should be doubly skeptical as to Dodd-Frank’s ability to forestall future crises.

To Help the Poor, Don’t Expand Medicaid — Just Get out of the Way

The gods tell me I’m not allowed to post the article, “Medical volunteers not free to cross state lines; Charity wants changes so it can help more,” from The Tennesseean in its entirety. So here’s an, ahem, excerpt:

The founder of the Knoxville-based charity Remote Area Medical Volunteer Corps says his nonprofit is hamstrung by laws preventing medical volunteers from crossing state lines.

Stan Brock told the Bristol Herald Courier that RAM has provided free medical and dental care to more than half-a-million patients since 1992, but it could serve even more if state laws were changed…

Brock said the group recently went to Joplin, Mo., with a mobile eyeglass lab. But they were not allowed to make free glasses because their volunteer optometrists and opticians were not licensed in the state.

Events in California have had dozens of empty dental chairs as patients were turned away — not for lack of willing volunteers but because state law creates impossible hurdles for out-of-state providers.

“Before Georgia told us to stop, we used to go down to southern Georgia and work with the Lions Club there treating patients,” he said.

Brock said the laws are designed as “turf protection,” but his charity efforts pose no threat to traditional medical providers…

RAM began providing its free services, which it calls “expeditions” in South America. Its first expedition in the U.S. was in Tennessee, which also passed the first law allowing the providers to cross state lines for charity care. Illinois later adopted a similar law, modeled after Tennessee’s.

Brock said those laws have three key components: They allow health providers from out of state to provide charity care, protect them against frivolous lawsuits and are simple enough to allow busy volunteers to come without jumping through hoops.

See also this moving photoblog about a Remote Area Medical “expedition” to Appalachia.

For more about Remote Area Medical, click here.