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2 Judges on DC Court: “States” means “states”

While one federal court delivered the most significant rebuke to date of ObamaCare, another came to an opposite conclusion, setting the stage for more legal uncertainty.

First up,  the DC Court of Appeals ruled against the Obama Administration in Halbig v. Burwell. (The ruling is in this PDF link.)

At issue: Does the Affordable Care Act–particularly, its individual mandate and the means-tested subsidies to purchase insurance–apply to people in all 50 states, or only to some? The answer, according to the court, is “only to some,” and the implication is that the ACA has much less power than it would otherwise have.

Here’s a bit of the nitty-gritty on how this works. The text of the Affordable Care Act (ObamaCare) says that everyone must have health insurance. It also calls for taxpayer-funded subsidies to buy insurance, and sets out regulations to define acceptable forms of insurance. But the Act, through several provisions, defines that requirement and those subsidies in the context of people who live in states that have established (again, under the Act) insurance exchanges.

The law did not, however, require states to set up exchanges, so of the 50 states, only 14 have done so. So can the IRS dispense subsidies to people in the 36 states that have not set up an exchange? The short answer: No. What about the fines that businesses face for not paying for insurance for their employees? Gone. The individual mandate? Gone as well.

The three-judge panel of the Court, usually cited as the second highest in the land, decided that the IRS acted in a way that was “arbitrary, capricious, [and] an abuse of [its] discretion.” The Administration can and will ask the full Court to consider the matter, and you can expect that this will end up before the Supreme Court in a matter of time.

My favorite part of the ruling may be have come when the Court considers the argument that it ought to overlook the plain language of the relevant text (Section 36B) and instead consider the overall aim of the legislation. To quote the majority opinion, “the government and dissent in effect urge us to substitute our judgment for Congress’s. We refuse.” The opinion continues, “Section 36B plainly makes subsidies available only on Exchanges established by the states. And in the absence of any contrary indications, that text is evidence of Congress’s intent.”

In dissent, Judge Edwards leads off with this: “This case is about Appellant’s not-so-veiled attempt to gut the Patient Protection and Affordable Care Act (“ACA”).” To which the proper response might be: So what? The court needs to rule on whether the law was being properly administered, not whether the appellant’s motives were obvious or obscured. Judge Edwards also argues that it is “inconceivable” that Congress could enact a law in such a way that it could “crumble” absent state participation in exchanges. That strikes me as a naive understanding of the legislative process, overlooking the fact that in the sausage factory of lawmaking, strange things happen.

On the same day, though, the Fourth Circuit Court of Appeals came to the opposite conclusion, in King v. Burwell (link is in PDF). It said, “we cannot discern whether Congress intended one way or another to make the tax credits available on HHS-facilitated [federal] exchanges.” Thus it decided unanimously to “uphold the [IRS's] rule as a permissible exercise of the agency’s discretion.” The idea that the IRS should have a significant role in health insurance is … let’s just say it’s not comforting.

I’ll note that the various parties to the case show, once again, how “big health” is in favor of the ACA. Weighing in in support of the law in Halbig and King were not only officials from the U.S. government, but AARP (a major seller of health insurance), the American Cancer Society, the American Diabetes Association, the American Heart Association, and the American Hospital Association. Also on the pro-ACA side was America’s Health Insurance Plans, a trade association of insurance companies that have figured they would come out ahead from the law’s personal mandates and taxpayer subsidies.

For further reading, I commend to you Michael F. Cannon’s commentary in Forbes, Halbig v. Burwell would free more than 57 million Americans from the ACA’s individual & employer mandates. I’ve met Cannon several times, and he’s been a sharp critique of the ACA. CNN, meanwhile, observes that “The easiest fix — changing the law to specify that it allows subsidies for coverage purchased through the federal government as well as state exchanges” — won’t be happening anytime soon.

Search warrants required for cell phones: SCOTUS ruling

The Supreme Court has ruled a ruling with some significant implications for policing and personal privacy. To quote from a review from the Washington Post, “In a unanimous opinion by Chief Justice Roberts, the Court holds that searching a cell phone incident to arrest requires a warrant.”

A few comments on the ruling:

First, the analysis comes from Orin Kerr, a contributor to the Volokh Conspiracy (VC). The VC is a group of legal experts who for a long time maintained their own group blog, and I once had the task of editing a column maintained by one of its contributors. (He was, and is, an excellent writer.) The Post was wise to add VC to its stable of writers. Other legacy publications may find it wise to hire or otherwise establish branding agreements with non-journalistic experts with a proven track record of good writing and a healthy readership. (Any publication that works in the public policy or ski/snowboard space …. I’m here.)

Second, the Court observes that cell phones have many different functions: “The term ‘cell phone’ is itself misleading shorthand; many of these devices are in fact minicomputers that also happen to have the capacity to be used as a telephone. They could just as easily be called cameras,video players, rolodexes, calendars, tape recorders, libraries, diaries, albums, televisions, maps, or newspapers.” At the risk of endorsing the reasoning of the Court because I like the outcome, I think the Court got it right. It took the constitutional principles of the Fourth Amendment (printed in the next paragraph) and applied it to the society of today. By virtue of the data they can contain, cell phones have become the “houses, papers, and effects” of the digital age. The note that 12 percent of cell-phone users admit to taking their devices into the shower strikes me as a bit too much “jurisprudence by sociology.” I suppose the Court wanted us to know that it understands who connected we are to our phones.

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.

Third, the decision is a good time to review some developments that inspired the Fourth Amendment. Eugene Volokh has those, on a companion blog post.

Fourth, it’s encouraging that this case, Riley v. California (PDF), was a unanimous decision. This shows a significant endorsement of the idea that the state’s police power must abide by constitutional limits. (Justice Alito, though, issued a concurring opinion, asking legislatures to consider laws of their own and not rely on the “blunt instrument of the Fourth Amendment” and federal courts.)

Finally, as is true in many cases, this particular case came out of the actions of a not terribly attractive individual–someone quite possibly a gang-banger. But if you’re not willing to abide by a principle when it hurts, you’re not terribly committed to it.

Saving money on college, extreme edition

Many people who attend college will be saddled with large debts and unmarketable degrees. One Minnesota man, though has found one way around it: Load up on college classes while still in high school.

The Northfield News reports on one local resident who has earned a high school diploma and a college diploma in the same year. David Greer used Post Secondary Enrollment Options (PSEO) a program under which high-school students can take college classes free of charge. Greer also earned college credits through CLEP. 

School districts face incentives to not fully inform students about PSEO, as they lose some money whenever a student shifts enrollment from the district to the college. Colleges, for their part, have an incentive to tell high-school students about the financial savings — free money for college! — but have been prohibited by state law, in what some people call a gag rule. Why? Consider this: School districts are loathe to lose “their” money to colleges. (The district loses some money when a student enrolls at a college.) It appears that the gag rule was removed during this last legislative session. That’s a boost for students. Arguably, it’s a good thing for taxpayers, too. I haven’t seen a financial analysis of this, but I suspect that it’s a case of money being diverted from one institution (high school) to another (college), with minimal increase in exposure for the taxpayer. If it helps students complete college without more debt, so much the better.

Oh yes, there’s something else that should be mentioned about this story: Greer has been homeschooled, which means that for much of his schooling he drew nothing from the public fisc at all. In other words, homeschooling benefits the public treasury.

 

National sovereignty is not a sufficient reason for “the ultimate sacrifice”

Today is Memorial Day. It’s common to confuse it with Veterans Day. One example comes from the Twitter feed of one business, “Today we honor all Veterans, including those on our Staff here, we thank all of those who have served our country, and we remember those who made the ultimate sacrifice.”

There was a letter-to-the-editor someplace that captures the distinction nicely. It was posted on Facebook, but given that platform’s penchant for playing hide-and-seek with updates, I can’t find it now. So I’ll paraphrase: Memorial Day isn’t about military service or all veterans. It’s about the lives that are never lived to completion, and in the case of men who died before they became fathers, babies who were never born. Here’s my solitary example from my family history: My grandmother had a brother who saw military service in the Asian theater of World War II. He contracted malaria or yellow fever or some such disease, and died, leaving no heir. What contributions would he, or his children, made to America in the 1950s, 1960s, and beyond? We will never know. Lives cut short, or not lived at all. That’s what we should think about on this day.

One of my blogging friends, Mitch Berg, takes on Memorial Day from a related though different angle. He writes on Facebook (ellipses in the original): “The two challenges of Memorial Day: Remembering those who died to keep this nation free (and thanking those who didn’t die, naturally) … and making sure this nation is worthy of that sacrifice.”

That in turn got me thinking of some lectures I heard yesterday, by the late J. Rufus Fears. He argued that there are three components to freedom: (1) National sovereignty; (2) Freedom to participate in politics; (3) Freedom to live your life as you wish, as long as you don’t harm others.

Which components of freedom have America’s veterans died for? One hopes the answer is “all three.” After all, the conventional wisdom is that the United States is defined not by bloodline, race, or clan, but by an idea, roughly that of personal and national self-governance, with a large dose of regard for others thrown in. Each element of freedom, Professor Fears said, can exist independently of each other. (Note here that I’m expanding on his remarks.) A country can have national freedom but lack political and personal freedom. Its government is sovereign and not subject to any other state–but the people lack political and personal freedoms. Fears cites North Korea as an example. Or, a country can have national freedom, and the people can have a great deal of personal/economic freedom, as long as they don’t question the government. (Imperfect examples of this “ideal type” may include Chile under Pinochet, Spain under Franco, and today, Singapore and some regions in China.) Finally, a country could have national freedom and political freedom but lack economic freedom. (Perhaps Sweden after World War II until fairly recently is an imperfect illustration.)

What is the scorecard of the United States? We have national sovereignty nailed down, so yes, military personnel who die in combat today preserve national freedom. (Mitch asks whether the existence of “open borders” undermines my claim. No. The U.S.A. has chosen to have semi-open borders; this was not a decision forced on it by other countries.) What about political freedom? We’ve had a checkered history of that. See, for example, the various efforts throughout the decades to deny the vote to blacks. We’ve made strides toward improving political freedom (the Civil Rights Acts, despite their numerous flaws, are one example). Conservative groups can complain about the abuses of the IRS, and liberals can look back in the 1960s to the Department of Justice. But overall, the country is still doing pretty well on this regard. Personal freedom? Well, the status of that depends on how you define personal freedom. If you define it the way FDR defined it — “freedom from want” and in brief, risk and hardship — we’ve enacted an enormous federal government to promote that, though its efficacy and wisdom can certainly be questioned, even on its own terms. If you define person freedom from the perspective of “leave me alone,” we’re not doing so well. Something like one-third of all employed people work in jobs that require a state license or certification, for example. Then there is the alphabet soup of agencies–EPA, FDA, USDA, EEOC, DOL, not to mention IRS–that stands ready to pounce on the non-compliant.

Traditional conservatism might say that national freedom is sufficient reason to die. The argument goes, roughly, that each person is embedded in a specific culture and society, and fealty to that society is worthwhile. Maybe they’re right, but that is emotionally and intellectually unsatisfying. Traditional conservatism also embraces natural law, the idea that there is a right and wrong that transcends cultures. So dying for a national government at the expense of a gross violation of natural law (Nazi Holocaust, anyone?) is not commendable.

Is death in the service of the United States today a foolish thing? Some people would say yes, saying that the country has gone far off the rails, that personal and political freedom is a mirage. Military personnel die, if they think about it, only for their comrades, and if there’s any larger beneficiary of their deaths, it’s the “empire.” The ideas that may have made “the ultimate sacrifice” have been squashed, squandered, or never there in the first place.

So is this a correct point of view? I can’t say that it is, not now. Yet, I do fear our national politics and national culture are pushing us in that direction. We chant “USA! USA! USA!” at the Olympic Games, while governments and the culture at large put the squeeze on personal freedoms.

So perhaps one way to honor those who have died in uniform is to be an advocate for political and even more importantly, personal freedom.

Divided we live: Political, economic, racial polarization in Milwaukee metro

One concept from graduate school (political science) that has stuck with me is the benefit of cross-cutting cleavages, which has nothing to do with “wardrobe malfunctions.” (See Wikipedia for an explanation: http://en.wikipedia.org/wiki/Cross-cutting_cleavage.)

The Milwaukee Journal-Sentinel, however, has produced an analysis of its readership area, showing that there are plenty of “reinforcing cleavages,” or as we might call it outside of academic journals, polarization. Republicans and Democrats live in separate worlds. So do conservatives and liberals, whites and blacks, poor and white, and so forth. Pigeon-holing — or if you will, stereotyping — has become more and more accurate.

Here’s an introductory paragraph from the scene in Milwaukee:

Metropolitan Milwaukee is the most polarized part of a polarized state in a polarized nation. It combines in one political hothouse an unusual constellation of divisive forces: deep racial segregation; an intensely engaged and sometimes enraged electorate; and the Balkanizing effects of serving over the past decade and a half as one of the most fought-over pieces of political turf in America.

How did we get this way? There are plenty of possible explanations. I’ll just say this: As government grows larger and the value of political victory increases, expect more contentious battles.

Read the whole thing here: http://www.jsonline.com/news/statepolitics/democratic-republican-voters-worlds-apart-in-divided-wisconsin-b99249564z1-255883361.html?ipad=y

 

 

Leftist leanings in academia: Yet another chapter

It’s fine if people in a particular profession lean this way or that in their political views. There’s nothing particularly appealing about an ideological quota, after all. Sometimes, the leanings are simply driven by logic. I would not expect that people who believe that the use of fossil fuels is a moral assault on Gaia or future generations of humans, for example, to rush into the business of petroleum engineering.

On the other hand, what if the ideological leanings of an academic field of study came about not by the coincidental choices of candidates, but through people already in the field filtering out those of a different opinion? Today we’d call that “discrimination,” and it’s a common complaint among conservatives.

From the Washington Times comes news of a new research project. The conclusion: “In decisions ranging from paper reviews to hiring, many social and personality psychologists admit that they would discriminate against openly conservative colleagues.”

It’s not realistic to expect that academics would have no opinions on political or social questions. Is it, though, realistic to expect that they would be able to put their own views aside when it comes to hiring others, approving publication drafts, or inviting someone to sit in on a panel discussion at a conference? I would hope so — “we’re here to learn, to test hypotheses, so bring on differing opinions” — and all that. But perhaps that’s too much to expect today.

Here’s the Times article:

http://m.washingtontimes.com/news/2012/aug/1/liberal-majority-on-campus-yes-were-biased/?page=all

Switching from DC to DB after turning down repeated opportunities

A county commissioner in Hennepin County, Minnesota, has been given plenty of chances to switch from a defined contribution retirement plan to a defined benefit one. He’s refused the chances each time.

Now he wants to switch. The Legislature appears to be crafting legislation to let him do that.

Is this any way to operate an employee benefits policy? Given the unrealistic expectations that Minnesota public pensions have for investment returns, any change would also increase the risk incurred by taxpayers for the commissioner’s retirement income.

For more, see this article from Minnesota Public Radio:

http://www.mprnews.org/story/2014/05/09/hennepin-cmr-seeks-pension-switch-critics-cry-foul?refid=0

 

Google follows Microsoft to Washington

A group of nerds get together to start a company. They become wildly successful by focusing on their business. Then they go political.

Stop me if you’ve heard this story before. Oh wait. You have. In the 1990s, there was Microsoft, which had a tiny presence in Washington DC, until its competitors egged on the US Department of Justice to pursuit anti-trust actions against the company. So it entered the parasite economy.

A more recent entrant is Google. Says the Washington Post:

“Nine years ago, the company opened a one-man lobbying shop, disdainful of the capital’s pay-to-play culture.

Since then, Google has soared to near the top of the city’s lobbying ranks, placing second only to General Electric in corporate lobbying expenditures in 2012 and fifth place in 2013.”

When government has enormous powers to reward or punish companies, it is any wonder that money finds its way into politics?

Less bureaucracy, lower costs: Imagine that

The world of health care finance is one giant Rube Goldberg machine, with any number of third parties involved. Through Medicare, the U.S. government is the dominant player in setting prices for thousands of medical treatments. Corporate plans and private insurance companies add themselves into the mix, and of course the Affordable Care Care (ObamaCare) adds even more moving parts.

But there’s a small movement toward stripping away the various bureaucracies, private and public, that interject themselves into health care. For example, some physicians eschew insurance, and go on a cash-only basis. They say it lets them cut costs — no need to staff up with people whose job it is to wrangle with insurance companies. They also say it also lets them have a profitable practice with a lower volume of patients, which means more time for patients. (Cynically, you could also say it leaves more time for playing golf.)

This movement has been going on for a while, and the New York Times has published one of the latest examinations of this in the popular press: Doctors shun cash.

The war on e-cigs

So-called e-cigarettes, or e-cigs, are a curious product. They are called cigarettes, but they don’t contain tobacco, and people who use them don’t set anything on fire–except perhaps the desire of neo-prohibitionists to regulate them as if they were cigarettes.

Have they been proven completely safe? No. But then again, we know that real cigarettes are harmful. If e-cigs, or electronic nicotine delivery systems as they are more fully called, can help some people kick the tobacco habit, the FDA and various state and local agencies should not attempt to regulate them out of business. After all, “if it saves one life ….” Right?


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