Where We Need to Go on Health Care.
Health care is the wedge issue for those who would insert more government control over the individual's life. And why not, given public dissatisfaction with the status quo? But there's a better way.

From Sen. Norm Coleman's junk mail one page "annual report" comes these encouraging words on health care policy. It's a start. (I have introduced paragraph breaks to make the text more readable.

Every American should have access to an affordable high quality health plan. Minnesota has the highest rate of insured citizens but we can and must do better. The answer is not bureaucratic, socialized medicine, as some have proposed, where government makes the decisions for you regarding your health care options.

Instead we should rely on the power of the private market, which gives you the quality of care you deserve and leaves you in the driver's seat regarding health choices. I believe government should offer incentives for positive change and care for the neediest. I think government should give you control over your helath spending dollars through an insurance tax credit that ensures everyone has health insurance regardless of a person's job.

Additionally, the federal government needs to encourage states to create a one-stop-shop to help people understand all their insurance options and make good choices for their families.

States should also be given incentives to organize the private insurance market in order to create cost-saving efficiencies and make sure no one is turned away. You should own and control your own health insurance, not the government.

What government can and must do is reduce barriers and help everyone get insurance. That's a goal we can reach, and I am developing a plan to do it.

Without parsing each sentence, I'll have to say that I'm pleased with the theme of this message. Too often, free-market folks have avoided the health care field, except to say "no government."
Private bureaucracies--HR departments, HMOs, hospital billing departments--don't have a great record, either. That makes it easy for the public to say "Hey, can it get worse?"

Yes it can, if we let government take over.

This isn't to say that the status quo is defensible, either. Do you depend on your company's HR department to select what kind of clothing you buy? What kind of house you live in? No. But we depend on corporate America for our health insurance plans.

How did we get into that situation? In large measure, government. Specifically, federal tax law.

Much needs to change in our health care policy. Two good places to start are Who Killed Health Care? and The Cure: How Capitalism Can Cure American Health Ca (permalink)

You May NOT Shop at Wal-Mart
"I know what's better for you than you, and I'm going to use the power of law to make sure you don't do something stupid."

Whether it's a smoking ban (you're too stupid to decide where to eat dinner), Social Security (you're too stupid to plan for your own retirement) or any number of other issues, there's a lot of that attitude going around.

Another expression of that is the battle against Wal-Mart, as "community activists," backed by labor unions that don't like a non-union shop opening up in their market, worry about the implications of a new WallyWorld down the street. "Oh sure," they may say, "you'll have lower prices. But you'll suffer."

In other words, you're too stupid to judge matters for yourself. Government must step in to deny Wal-Mart the opportunity to open a new store.

(I should say here that not everything the company does is admirable.)

I'm reminded of all this when I go through the archives of drafts I have never finished, and come across an article by George F. Will. He notes the benefits of Wal-Mart to individuals and the economy (money saved, productivity enhanced, jobs offered, etc.)

He contrasts these benefits of the company with the stubborn attitude of the city council of Chicago, which drove the retailer--and its tax revenues--to a suburb. The people who shop at the new store? City residents.

Will closes with a swipe at the political attitude of superiority:

Liberals think their campaign against Wal-Mart is a way of introducing the subject of class into America's political argument, and they are more correct than they understand. Their campaign is liberalism as condescension. It is a philosophic repugnance toward markets because consumer sovereignty results in the masses making messes. Liberals, aghast, see the choices Americans make with their dollars and their ballots, and announce -- yes, announce -- that Americans are sorely in need of more supervision by ... liberals.

I'd add that conservatives can be guilty of this attitude as well.

Finally, for more on Wal-Mart as a political punching back and economic force, I'd recommend a series of interviews conducted on The Box Program, which originates in Pennsylvania. (permalink)

Something New Coming Your Way.

Watch this space.

Coming soon (permalink)

Billions for Schools. And what for taxpayers?
Are courts going out of the school budgeting business? Maybe, though I have my doubts.

Back in October 2006, Sol Stern wrote about what happens when a politician, beholden to a teachers union, must then find a way to pay when the union's demands threaten to impose significant burdens on the state.

A group in New York sued the state for another $5 billion in school funding, and won. And there we get the strange world of lawyers determining school budgets.

Anticipating the results of the next month's election, Stern had this to say: "[Soon to be Gov. Elliot] Spitzer knows all the reasons why this case has been a perversion of the judicial process, why it has nothing to do with education improvement and why it poses a grave threat to the state's fiscal future.

After all, it was Attorney General Spitzer, acting as the state's lawyer, who noted that the court started down a perilous path when it decided that a single sentence in the state Constitution - one that merely requires New York to provide a "system of free common schools" - allowed judges to substitute their judgment about school funding for that of the legislative and executive branches."

The journal Education Next, by the way, offers a review of these sorts of lawsuits in its 2007 Summer edition.

The New York group didn't get the $5 billion, but "only" $1.9 billion. Josh Dunn and Martha Derthick see in the New York case, as well of others, signs that courts are growing wearing of handling such cases.

"Staring into the political abyss of adequacy litigation has apparently prompted some state courts to step back from the edge. Over the past two years, the highest courts of New York, Texas, and Massachusetts have decided to end or limit their support for adequacy plaintiffs. These decisions have all professed respect for separation of powers. However, the rulings seem motivated just as much by the recognition that courts lack the capacity to solve the problems of education and the institutional resources to enforce their decisions."

The state's highest court recognized that budgetary questions belong with the legislature. "Deference to the legislature is especially necessary where it is the State’s budget plan that is being questioned.... The Legislative and Executive branches of government are in a far better position than the Judiciary to determine funding needs throughout the state and priorities for the allocation of resources.”

On the other hand, the high court in Kansas went in the other direction (PDF), forcing the state into spending hundreds of millions of extra dollars. Once again, the legislative function of determining budgets was outsourced to courts and hired guns.

Labels: K-12 education

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Private Gain, Private Pain.
If a tree falls in the middle of your property and there's not a government employee around, will it still be cleaned up?

When I returned to town from a recent trip up north, I noticed that many homeowners had placed tree branches, some of them very large, out by the curb. Of course that told me that a significant storm had passed through. But it also raised a question about public policy: who's going to pick up and dispose of that debris?

I've lived in several cities in my life, and so I've seen several approaches to refuse disposal. Some cities have an in-house garbage disposal unit, often employing union labor. Others follow the monopoly model, but contract out the collection to a commercial firm such as Waste Management or BFI.

In my current city, each landowner is responsible for selecting his own refuse hauler. Though it means that multiple trucks will be bearing down on residential streets on collection day, it also means that residents are able to choose in a competitive market for the combination of price and service that works for them.

Given that background, I was surprised to see the branches out by the road. Had people forgotten that the city won't come out and haul this away?

Perhaps. I looked up the city web site, and sure enough, there was an announcement, front page: your trash if your responsibility. That includes tree limbs that fall solely on your property. Late that evening, I got a "Reverse 911" call to that effect as well, just to drive home the message.

My lot is fairly small and (sadly) with few stately trees. The upside is that the scrub trees along the back property line produced only one "large" branch that needed disposal. Within a week, I had attacked it with vigor, resulting in a nice addition to my stockpile for winter burning.

It certainly can be a nuisance to make your own arrangements, especially if, unlike me, you have many trees to take care of. But I wouldn't have it any other way.

Why? Trees add value to the land. You pay more, but when you sell, you get more back, too. Like a spacious, up-to-date bathroom, a grove of trees adds to your property value.

I would no more expect taxpayers to pay for the tree-related expenses of my property than I would expect them to pay to replace a leaky toilet. My gain, my pain. Your gain, your pain.

Save tax money for truly public services. Clean up after yourself.

(Same message as before; re-written on 8/20/07 because the first edition was in dire need of an edit.)

Labels: Economics

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Which Risk do You Prefer?
Bad stuff happens in life, some of it predictable, much of it not. Trade-offs are inevitable (guns versus butter, you know). So is risk.

Lately I've been wondering if the most accurate way of describing the political divisions in the country is to ask some questions about risk.

Take retirement planning, for example. If you prepare by investing in a broad portfolio of bonds and stocks, you're going to have some investment risks. Interest rates will rise and fall, and the stock market will tank from time to time.

A lot of people think that's a good example of risk. They prefer that government take money from everyone, pass it to other people, and continue the process indefinitely.

I happen to think that THIS is risky behavior. It's trusting politicians, who inevitably have short-term horizons, to do the right thing. It also counts on one generation of politicians to keep the promises made by earlier generations. But that's not the wisest course. The retirement age has been raised and various taxes have been imposed over time. In other words, promises broken.

There are other examples that could be spun out, but that's a start. The point is the same: risk and uncertainty are inevitable, and in this life, "stuff happens." Is it better to diversify the risk and uncertainty through the voluntary actions of many (e.g., investing in a total market index fund) or through concentrating the risk in the hands of a relatively few number of politicians? (permalink)

We Need Grown-Up, not Childish Reaction to Bridge Collapse.
Bridge collapses into a river, killing several, traumatizing many. The reaction of some? Blame the no-new-taxes pledge.

Childish? Yes, especially when put into rhyme by one resident who used a child's song in a letter-to-the-editor, published in one of the metropolitan area's major newspapers. Ah, the wisdom of children!

Children want what they want when they want it, which is "everything" and "now."

People who carp about the Iraq war, foreign aid, corporate welfare (I'm against two of the three, for whatever it's worth) engage in a game of "Imagine," which is also the title of one of the most childish pop songs of all time.

Imagine a world without tax cuts, by golly, nothing would ever go wrong. There would be no tax collapse.

Sure. As if. Raise taxes in the name of fixing bridges, and how much of that money will actually go towards fixing bridges?

Less than 100 percent. It will get sucked into pet causes of various sorts, none of which have anything to do with bridges. The problem isn't a lack of government revenue. How about a new slogan? "It's the priorities, stupid!"

Raise taxes to fix a problem? As if. Give government all the money it says that it needs, and no harm will ever assail us.

Right.

Sorry. The lesson of the bridge is not that tax cuts are bad, or even that ever increasing tax rates are bad.

It's that the political process gives us fun social experiments and "let's make the world a better place" dreaming, which take the attention off the basics.

And even if government focused exclusively on the basics, there would still be tragedies dues to randomness, bad luck, whatever. That's because we've forgotten two very important words.

Stuff happens. (permalink)