Tag: Jeff Flake

A Sad Day for the Republic

Sen. Jeff Flake (R-Arizona) has announced that he will not run for reelection. He announced his decision on the Senate floor in a searing speech about the state of our political culture, especially at the hands of President Trump:

It is time for our complicity and our accommodation of the unacceptable to end.

In this century, a new phrase has entered the language to describe the accommodation of a new and undesirable order – that phrase being “the new normal.” But we must never adjust to the present coarseness of our national dialogue – with the tone set at the top.

We must never regard as “normal” the regular and casual undermining of our democratic norms and ideals. We must never meekly accept the daily sundering of our country - the personal attacks, the threats against principles, freedoms, and institutions, the flagrant disregard for truth or decency, the reckless provocations, most often for the pettiest and most personal reasons, reasons having nothing whatsoever to do with the fortunes of the people that we have all been elected to serve.

Flake was anticipating a rough 2018 in Arizona. In polls a year ahead of the Republican primary, he was running well behind a former state senator who held a town hall on “chemtrails.” And Democrats have a strong candidate in Rep. Kyrsten Sinema, who promptly reached out to Flake supporters and Goldwater Republicans, telling the Arizona Republic, “It’s been an honor to know and serve with Jeff. He is a man of integrity and a statesman who is true to his convictions – an Arizonan through and through.”

Despite his political challenges, it’s disappointing that another of the few Republicans willing to call out President Trump for his misguided positions, his coarseness, and his damage to “our democratic norms and ideals” will be leaving the Senate. This is precisely the moment when clear-eyed senators such as Flake and Sen. Bob Corker (R-Tennessee) are needed. Flake and Corker do have another 14 months in the Senate. If they use their time well, they will deserve a new chapter in Profiles in Courage, John F. Kennedy’s book about senators who suffered criticism and electoral losses after taking a stand on principle.

It’s also unfortunate that Trump and Steve Bannon are seeking to drive out of the Republican party Reaganite leaders and replace them with protectionist populists. As Flake said:

It is clear at this moment that a traditional conservative who believes in limited government and free markets, who is devoted to free trade, and who is pro-immigration, has a narrower and narrower path to nomination in the Republican party – the party that for so long has defined itself by belief in those things. It is also clear to me for the moment we have given in or given up on those core principles in favor of the more viscerally satisfying anger and resentment. To be clear, the anger and resentment that the people feel at the royal mess we have created are justified. But anger and resentment are not a governing philosophy.

He said more on these topics in his recent book with the consciously Goldwateresque title Conscience of a Conservative: A Rejection of Destructive Politics and a Return to Principle, which is well worth reading.

I hope Senator Flake will find ways to serve the cause of limited and republican government over the next 14 months and beyond.

Members of Congress Introduce Cato ‘Large HSAs’ Concept

WASHINGTON, DC - JANUARY 29: (L-R) Sen. Jeff Flake (R-AZ), and Sen. Patrick Leahy (D-VT) speak at a press conference on Cuba at the U.S. Capitol January 29, 2015 in Washington, DC. Flake is introducing legislation with bipartisan support that would lift a longstanding ban on U.S. citizens traveling freely to Cuba. (Photo by Win McNamee/Getty Images)

Sen. Jeff Flake (R-AZ), Rep. Dave Brat (R-VA), and other members of Congress have introduced legislation based on the “Large HSAs” concept I first proposed here and developed herehereherehere, and here.

The “Health Savings Account Expansion Act” (H.R. 5324S. 2980) would expand the availability and benefits of tax-free health savings accounts (HSAs) in several ways. It would nearly triple existing HSA contribution limits from $3,400 for individuals and $6,750 for families to $9,000 and $18,000. It would allow tax-free HSA funds to purchase health insurance, over-the-counter medications, and direct primary care. It would eliminate the mandate that HSA holders purchase a government-designed high-deductible health plan. And it would repeal ObamaCare’s increase of the penalty on non-medical withdrawals. Americans for Tax Reform and FreedomWorks have endorsed the bill.

I’m sure I will have lots to say about Flake-Brat, but here are a few initial impressions.

  1. Flake-Brat would free workers from the government program we call employer-sponsored insurance—but only if that’s what workers want. The federal tax code currently tells the average worker with family coverage she can either surrender $13,000 of income to her employer and let her employer choose her health plan, or surrender a huge chunk of that money to the government by paying income and payroll taxes on it. The Flake-Brat bill would allow her to keep that money and either save it, use it to stay on her employer’s health plan, or use it to purchase better coverage somewhere else, all tax-free. The choice would belong to her, not to Congress or the IRS.
  2. Flake-Brat is a bigger tax cut than you’ve ever seen.  Large HSAs would be the largest-ever scaling back of the federal government’s role in health care. The Flake-Brat bill is effectively a $9 trillion tax cut. That’s how much money the current tax exclusion for employer-sponsored insurance will divert from workers to their employers over the next decade. Flake-Brat would return that money to the workers who earned it. Flake-Brat is thus an effective tax cut equal to all of the Reagan and Bush tax cuts combined. It is nine times the size of the tax cut associated with repealing ObamaCare.  Unlike health-insurance tax credits, Large HSAs involve no government spending and would not mandate that taxpayers purchase health insurance, as existing HSAs and health-insurance tax credits do. (The bill and its sponsors describe that requirement as a “mandate.”)
  3. Flake-Brat would make health care better, more affordable, and more secure. It would do so by dramatically reducing government’s influence over the health care sector. By shifting from employers to consumers nearly a quarter of the $3 trillion Americans spend annually on health care, Large HSAs would begin to make the health care sector and health policy respond to the needs of patients. Large HSAs are also less restrictive than existing HSA law or health-insurance tax credits. As a replacement for ObamaCare, Large HSAs would encourage innovative products like pre-existing conditions insurance that make coverage more affordable and secure.
  4. Flake-Brat shows Congress could create Large HSAs with or without repealing ObamaCare. Large HSAs are the most promising ObamaCare replacement plan to date, but Congress can create them before it repeals ObamaCare. The Flake-Brat bill would create Large HSAs even with ObamaCare still on the books. In fact, Flake-Brat would build support for repealing ObamaCare by exposing consumers to the full cost of its hidden taxes.
  5. Flake-Brat is a marker. The Flake-Brat bill defers consideration of a number of issues. All else equal, expanding tax breaks for HSA contributions would reduce federal revenues and increase federal deficits and debt. Like any proposal to level the playing field between employer-sponsored coverage and other coverage, the bill creates the potential for employer plans to unravel as (healthy) people choose better options. Were Congress to enact Flake-Brat with ObamaCare still on the books, there could be even more complicated interactions. The bill doesn’t totally level the playing field, either. Everyone would get an income-tax break, but only those with an employer who facilitates HSA contributions would get the payroll tax break. (Large HSAs can completely level the playing field with a simple tax credit that mimics that exclusion for such workers.) The authors don’t address these issues in the bill, or their supplemental materials. They will have to address them at some point. Fortunately, there are solutions. (For more on those solutions, see the “developed” links in the second paragraph.)

All in all, the Flake-Brat bill is a much-needed addition to the debate over the future of American health care.

Good News on Cotton

We’re another step closer to putting a shameful chapter of America’s trade policy behind us, with the good news that the House today approved (by a margin of 223-197, roll call here) an amendment offered by Rep. Ron Kind (D-WI) and Rep. Jeff Flake (R-AZ) to prohibit the use of funds in the appropriations bill to provide payment to the Brazil Cotton Institute: the administration signed a deal last year with Brazil to send $147 million a year of taxpayers money to Brazil so they would look the other way while the United States continued to subsidize our cotton farmers illegally. Mr Kind and Mr Flake rightly argued that was an egregious use of taxpayer money. Some lawmakers agitated against stopping the payments in case it sparked a trade war, but the answer to that, of course, is to bring U.S. cotton policy into compliance with WTO rules (and rulings). More background here.

Topics:

This Week in Government Failure

Over at Downsizing the Federal Government, we focused on the following issues this week:

  • Unfortunately, the president’s Fiscal Commission appears to have operated on the premise that the federal government should continue to do everything it now does.
  • Getting Rep. Jeff Flake on appropriations is a step in the right direction, but his appointment can’t be a token gesture.
  • A new study finds that policymakers needn’t fear spending cuts.
  • House Republican leaders’ support for “Prince of Pork” Hal Rogers to chair the chamber’s appropriations committee is a slap in the face of voters who demanded change in November.
  • Michigan Gov. Jennifer Granholm, whose state’s unemployment rate is almost 13 percent, has advice for Washington on how to create jobs. No, it’s not April 1st.

Rep. Jeff Flake to Appropriations

In-coming House Speaker John Boehner’s endorsement of Rep. Jeff Flake (R-AZ) for a seat on the chamber’s appropriations committee means that it’s probably a done deal. Flake is one of the few policymakers who actually lives up to the fiscal conservative label. Thus, Flake’s appointment to a committee that many members think only exists to increase spending on special interests would be welcome news.

Boehner also endorsed a suggestion from Rep. Jeff Kingston (R-GA), who has mounted a dark-horse campaign to chair the appropriations committee, to create a subcommittee focused on investigating federal programs. Flake would chair this subcommittee, and according to a release on his website, he has already lined up worthy targets like Head Start and farm subsidies.

How much success will Flake have within the committee?

The New York Times quotes Flake as boldly saying, “It has been a favor factory for years, and now it is going to become a slaughterhouse.” At the same time, Flake acknowledged to Politico that putting a few anti-spenders on appropriations isn’t going to be enough:

Flake said the conservatives that Boehner wants to get on the committee will be “marginalized” if they’re scattered throughout the panel.

“It’s not enough just to have a few going on the committee,” he said. “They could be dispersed among the subcommittees that are forgotten.”

I recently warned the House Republican leadership against serving tea party voters re-heated meatloaf by allowing old-school spenders to dominate the committees. Getting Jeff Flake on appropriations is a step in the right direction, but his appointment can’t be a token gesture. Anti-spenders like Flake will need support from their leadership to succeed because they sure won’t be making friends with the big-spending old bulls.

Dueling Earmark Op-Eds

With a key vote on earmarks slated for next Tuesday in the Senate Republican Conference, Republican leaders are having it out on whether their party should eschew earmarking or continue the practice. The debate centers on the division of power between Congress and the executive branch.

On NRO’s “The Corner” blog, Senator James Inhofe (R-Okla.) calls earmarks a “phony issue.” Doing away with earmarks doesn’t reduce spending. It simply transfers authority for spending decisions to the executive:

Earmarks have been part of the congressional process since the founding of our country. As James Madison, the father of the Constitution viewed it, appropriating funds is the job of the legislature. Writing in the Federalist, he noted that Congress holds the power of the purse for the very reason that it is closer to the people. The words of Madison and Article 1 Section 9 of the Constitution say that authorization and appropriations are exclusively the responsibility of the legislative branch. Congress should not cede this authority to the executive branch.

And he criticizes the anti-earmark movement as “pseudo” fiscal responsibility:

While anti-earmarkers bloviate about the billions spent through earmarks, many of them supported the trillions of dollars in extra spending for bailouts, stimulus, and foreign aid. Talk about specks versus planks! Over the course of the last several years, the overall number and dollar amount of earmarks has steadily decreased. During that same time, overall spending has ballooned by over $1.3 trillion. In reality, ballyhooing about earmarks has been used as a ruse by some to seem more fiscally responsible than they really are.

Taking the other side, Rep. Jeff Flake (R-AZ) writes in the Washington Post that earmarks are part and parcel of Congress’s abdication:

Those who view earmarking as an expression of the “congressional prerogative” sell Congress short of its preeminent role as the first branch of government. As the defenders of earmarking are fond of saying, earmarks represent less than 2 percent of all federal spending. Precisely! By focusing on a measly 2 percent of spending, we have given up effective oversight on the remaining 98 percent.

This lopsided exchange can be examined empirically. As the number of earmarks has risen significantly over the past two decades, the amount of oversight exercised by the House Appropriations Committee — as measured by the number of hearings held, witnesses called, etc. — has declined substantially. It is as if Congress has called a truce with the executive branch: Don’t hassle us about our 2 percent, and we’ll offer only token interference with your 98 percent.

Senator Inhofe misuses Federalist #58. The “power of the purse” refers to the fact that revenue measures must originate in the popularly elected House, strengthening its hand against the Senate, whose membership was to be selected by state legislatures. But he is right to castigate the earmark opponents who have thrown buckets of taxpayer money into the wind when Washington, D.C., has lately spun itself into a whirl.

Inhofe’s static view of earmarking produces the weaker of the two arguments, though. Rep. Flake is right to recognize earmarking’s dynamic effects. The fiscal weaklings—majorities in both parties—decline oversight and go along with spending bills they might otherwise oppose because of goodies for their home states or districts.

Earmarker comity may even cause fiscal conservatives to go wobbly. Try counting the number of amendments Senator Inhofe has offered seeking to strike earmarks in 23 years of debating spending bills on the Senate floor, and you may not need to raise a finger on either of your hands.

The right answer is to take what both of these debaters has to offer. Earmarks should go, and Congress should withdraw spending discretion from the executive branch while it reduces spending overall.

I’ll be speaking Monday at a Hill event on earmark transparency. Should be a barn burner!