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Stupid Before Congress

Wednesday, December 10th, 2014

MIT economist Jonathan Gruber has had a big influence on American life, much of it “behind the scenes.” He helped put together RomneyCare in Massachusetts, then Obamacare at the federal level. And he made a curious case for abortion that was picked up by Steven Levitt and made famous in Freakonomics.

But he wasn’t summoned before the U.S. House of Representatives’ Oversight Committee, yesterday, to talk about abortion. His boastings, in public, that the Affordable Care Act had been designed to deceive caught congressional attention.

And referring to voters as “stupid” doesn’t sit well with politicians — maybe because they’re living evidence.

Gruber started with some newfound humility. He had been bragging. In truth, he wasn’t that important to the process.

None of this was very convincing.

His explanations for his too-honest statements? Less than satisfactory: he chalked it all up to a spoken “typo.”

More entertainingly, when repeatedly asked whether he would give the committee his work product relating to his Health and Human Services contracts, he reiterated one simple answer: the committee should “take it up with my council.”

“You’ve been paid by the American taxpayer,” stated Rep. Jason Chaffetz, with escalating frustration. “Will you or will you not provide that information to this committee?”

But what was the Utah representative expecting?

Full disclosure?

Transparency?

Responsibility?

A straight answer?

Yeah, yeah, I know . . . talk to Gruber’s lawyer.

Even with the stonewalling, I think we’ve already seen enough of Mr. Gruber’s “work product.”

This is Common Sense. I’m Paul Jacob.

Rewarding Gruber

Monday, November 24th, 2014

Revealing to all the world the contempt for the American people that Washington insiders possess might garner for Prof. Gruber a future Medal of Freedom.

Perhaps by a president elected by the Irony Party.

What Gruber is unlikely to get, however, is a Nobel Prize for Economics.

Benjamin Zycher, writing at The Hill, questions Gruber’s astuteness as an economist. The MIT professor surely has the wit to sucker those representing American taxpayers out of six million bucks for his consulting, but, otherwise, reveals some blind spots about where incentives should be figured in.

“Economists may disagree about many things,” writes Zycher, “but absent among them is the central role of incentives as determinants of behavior,” a principle that “applies fully to government.”

To reward one constituency at the expense of others, health care bureaucrats will quickly come to regard limits to spending as a kind of “savings.”

From this type of rationing, Zycher suggests, there will be “a reduction in the flow of research and development investments in new and improved medical technologies, yielding fewer new medicines, devices and equipment.”

This means that the most negative effects will be seen down the road. While the easier-to-publicize positive effects of more people covered by insurance can be pointed to right now, as a “benefit.”

However, even that upfront goody isn’t what we might pretend it is. “Gruber seems actually to believe that an expansion of insurance ‘coverage’ is the same as an expansion of actual healthcare,” Zycher notes, with apt incredulity.

By ignoring negative effects of his convoluted program, and concentrating on a few dubious upfront benefits, Gruber proves himself more con artist than economist.

This is Common Sense. I’m Paul Jacob.

As Stupid Does

Wednesday, November 19th, 2014

“Stupid is as stupid does,” said the great American prophet, Forrest Gump.

Meanwhile, Obamacare maestro and MIT professor, the illustrious Dr. Jonathan Gruber, has declared in not one but a multitude of videos that the American people are, well, “stupid.”

You see, when the elites wielding political power lie to us, trick us, cheat us — as with Obamacare — they think that proves that “We, the People,” aka their victims, are all morons. I’m not a fan of fraud or fraudsters; I don’t think it forms the basis for a very happy, healthy society.

Still, I do get their perverted logic. Problem is that, even as far as it goes, the American people didn’t fall for the deceit at the heart of the Affordable Care Act. Poll after poll leading up to Congress passing the ACA demonstrated that most folks opposed it, disbelieving Gruber’s and Obama’s distortions.

Barely a majority of the clueless Congress even fell for the lies! All of them were Democrats.

No, stupid would do something like rake in $6 million from government contracts obtained from politicians with a direct probe into every American’s pocketbook and then call all those Americans paying his lavish tab names. Indeed, Gruber does make a cogent argument about the wisdom of purchasing his services.

Stupid also does stuff like deny even knowing that Dr. What’s-His-Name fellow . . . though previously raving, on camera, about what a wizard the stupid-slinging Prof. Gruber is.

Right, Mr. Obama, Mrs. Pelosi?

Goodness, the American people seem brilliant in comparison. But it’s a low bar.

This is Common Sense. I’m Paul Jacob.

Is “Less Big” Possible?

Wednesday, October 15th, 2014

The idea of a streamlined welfare state is utterly foreign in today’s political climate. Offering some social services, but not others? Anathema — at least to our “progressives.”

It is also, even more obviously, not nurtured by current political process.

After all, we’ve witnessed two major expansions in “welfare” programs in the last decade, the bipartisan Medicare “Part D” and the Democrats’ “Obamacare.” The first was underfunded from the start, and the second was and remains a mess. Both are financial time bombs.

But if you think America has it bad, it’s worse in France.

Jean Tirole, the new (just announced) Nobel Laureate in Economics, calls the condition of the French labor market “catastrophic.” And he thinks France’s government has to be smaller.

Now, he’s no heir to J.-B. Say and Fredéric Bastiat. He does not support an extremely limited government, a “nightwatchman” state. He says he likes France’s basic model. But it has grown too far in size and scope:

Tirole remarked that northern European countries, as well as Canada and Australia, had proven you could keep a welfare social model with smaller government. In contrast, he said France’s “big state” threatened its social policies because there will not be “enough money to pay for it in the long run.”

He’s basically just demanding that government live within its means.

It’s not too far from common Tea Party sentiment.

But tell that to your average progressive pol. Or blogger. Or activist. Given protective cover for ever-growing spending by the likes of New York Times’s Nobel columnist, Paul Krugman, any idea of federal spending cutbacks have been and remain off limits.

Maybe Professor Tirole can convince them.

This is Common Sense. I’m Paul Jacob.

Google Mugged By Reality?

Tuesday, July 22nd, 2014

Google says health care is unhealthy.

Venture capitalist Vinod Khosla has conducted what he calls a “fireside chat” with Google founders Larry Page and Sergey Brin. In one much-cited passage, Brin observes that although he is excited about making gadgets like glucose-measuring contact lenses, health care, because “so heavily regulated,” is “just a painful business to be in. It’s not necessarily how I want to spend my time. . . . [T]he regulatory burden in the U.S. is so high that I think it would dissuade a lot of entrepreneurs.” Page echoes his colleague.

A blunt, and fair, observation. But it makes one wonder why these super-entrepreneurs have not been more critical (at least so far as their search engine can tell me) of Obamacare, which multiplies mandates and prohibitions in the medical industry by an order of magnitude.

Top Google executives are known to be liberal in their politics, and presumably have been sincere. It seems, though, that reality is not cooperating with any ideological tilt they may yet harbor in favor of government paternalism.

It’s in fields with which a businessman is best acquainted that he is most likely to recognize the value of freedom — at least his own, if not always that of competitors. So perhaps we should hope that Brin, Page and other Google principals try to achieve something great in every industry there is. That way, they can come around to consistent, principled support for freeing markets.

This is Common Sense. I’m Paul Jacob.

Preparing for a Bailout

Tuesday, May 20th, 2014

In his 2012 State of the Union speech, President Obama declared, “It’s time to apply the same rules from top to bottom: No bailouts, no handouts and no cop-outs.”

Yes. He said that. But in reality, the handouts and cop-outs have kept on coming, like the solar wind.bucket for bailout

A Washington Examiner editorial notes that while “Obama blasted the influence of insurance lobbyists and vowed to take on the industry … as president, he passed a health care law that funnels more than $1 trillion in subsidies to insurers, and fines Americans who do not purchase their products.”

Go ahead: call that a handout.

But what about bailouts?

While newspapers like The Washington Post insist that Obamacare is exempt from such an eventuality, there remains the part of the Affordable Care Act known as the risk corridor programs. These reimburse “insurance plans for claims that cost significantly more than premiums that new subscribers paid in,” according to The Post’s Wonkblog. The goal is to protect health insurance companies from the risks they face in the new Obamacare exchange.

Companies that make money will pay into a fund that will be used to bail out companies that lose money. But, after obvious complaints about limits, the Centers for Medicare and Medicaid Services (CMS) pushed a mandate that the program be revenue neutral, that the money paid out not exceed that paid in.

Last Friday, in 435 pages of regulations, CMS abandoned this call for budget neutrality. Instead, the regulation states, “In the unlikely event of a shortfall for the 2015 program year, HHS recognizes that the Affordable Care Act requires the secretary to make full payments to issuers.”

A taxpayer bailout: fully in place.

This is Common Sense. I’m Paul Jacob.

Rand Paul’s No-Special-Deals Petition

Thursday, April 17th, 2014

Are you tired of members of the political class foisting burdensome laws on us from which they liberally exempt themselves? Sign the petition.

I mean the “No Special Deals” petition expressing support for “Senator Rand Paul’s Constitutional Amendment to stop Congress from passing legislation that doesn’t apply equally to U.S. citizens, the Executive Branch, Congress and the Supreme Court.”

This is one of those amendments with the job of shouting “Read and adhere to the document I’m attached to!!!!!!!” We need almost as many such amendments as there are constitutional provisions, considering how chronically the Constitution is violated.

The spur is Obamacare, the latest package of law and politics to combine crippling mandates for most of us with special deals for those with political pull. Some people are deemed more equal than others when it comes to “equal protection of the laws” and so forth.

The rationale for equally applying laws that are tyrannical? To discourage tyrants loathe to be battered by their own bludgeons. And to disallow their divide and conquer gambits.

That’s the hope, anyway.

But if officeholders find a way to tyrannize to begin with, and don’t hesitate to tyrannize, will any formally enshrined demand for equality of tyranny serve to deter them?

No, sadly, Sen. Paul’s amendment won’t prevent assaults on our rights that aren’t already supposed to be prohibited by the rest of the Constitution. Not by itself. But the amendment could help and certainly can’t hurt.

(Hurt us, that is —  if it hurts our lawmakers, that’s the idea.)

This is Common Sense. I’m Paul Jacob.