August 15th, 2014 at 7:22 am
Podcast – Net Neutrality: A Solution in Search of a Problem
Posted by CFIF Staff Print

In an interview with CFIF, Mike Wendy, director of Media Freedom, discusses how so-called “Net Neutrality” is a solution in search of a problem and why heavy-handed government regulations are not good for consumers or investment.

Listen to the interview here.


August 14th, 2014 at 8:35 pm
Indiana Jumps on the Halbig Bandwagon
Posted by Ashton Ellis Print

Add Indiana to the list of states arguing that ObamaCare’s subsidies can’t be used on Healthcare.gov, the federal exchange.

The challenge is the same mounted by other states contesting the IRS’s unilateral decision to go against the clear language of ObamaCare which makes subsidies available only on state-based exchanges, a restriction intended to induce states to shoulder the implementation costs for fear of angering residents by exposing them to ObamaCare’s real costs.

U.S. District Judge William T. Lawrence will decide whether Indiana’s case has merit in October. Precedent from other circuits isn’t all that helpful, since the D.C. Circuit upheld the statutory scheme while the Fourth Circuit sided with the IRS.

The silver lining: Whatever Lawrence and the appellate circuit decide will further fragment ObamaCare’s implementation, increasing the likelihood that the Supreme Court will weigh in.

Whenever that happens, hopefully there will still be five votes to uphold the plain meaning of the law.

H/T: Indianapolis Star


August 14th, 2014 at 3:25 pm
Like IRS, CMS Emails Go Missing
Posted by Ashton Ellis Print

It looks like Lois Lerner – the former IRS manager at the center of the scandal targeting conservative groups – isn’t the only Obama administration official who lost emails subpoenaed by Congress.

Marilyn Tavenner, the head of the Centers for Medicare and Medicaid Services, is now believed to have deleted emails sought by congressional investigators trying to understand why Healthcare.gov had such a horrendous rollout.

“In order to stay below the agency’s Microsoft Outlook email size limit, Tavenner would regularly delete emails after copying or forwarding them to her staff for retention,” says the MSNBC report that broke the story. “However, Tavenner didn’t follow that procedure every time, meaning some emails never made it to her staff for safekeeping before being deleted.”

That could turn out to be a costly oversight for Tavenner.

As Jillian Kay Melchior points out, “Federal law tasks heads of all federal agencies with ‘mak[ing] and preserv[ing] records containing adequate and proper documentation of the organization, functions, policies, decisions, procedures, and essential transactions of the agency and designed to furnish the information necessary to protect the legal and financial rights of the Government and of persons directly affected by the agency’s activities.’”

Unlike Lerner who claims her IRS computer crashed taking with it unrecoverable emails – a claim disputed by IT experts inside and outside the tax-gathering agency – Tavenner, at best, is pleading that she’s too busy to follow the law. At worst, she’s the latest Obama administration official caught skirting her legal obligations to hide inconvenient truths.

To my knowledge, Tavenner isn’t considered an overt Obama loyalist, so it’s possible that the missing emails are a genuine oversight by a busy administrator. The trouble is, Tavenner works in an administration seemingly filled with people who are unwilling to comply with the kind of document sharing necessary for the people – through Congress – to understand and judge what unelected bureaucrats are doing. One of the tragedies of bad behavior by some is the suspicion it casts on everyone else on the team.

So be it.

Darrell Issa (R-CA), Chairman of the House Oversight Committee, has already pledged to hold hearings on alleged wrongdoing by agency heads when Congress returns from its August recess.

Don’t be surprised to see a hearing scheduled to get the truth about Tavenner’s missing emails.


August 13th, 2014 at 3:10 pm
Ramirez Cartoon: Tax Inversion
Posted by CFIF Staff Print

Below is one of the latest cartoons from two-time Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.


August 12th, 2014 at 6:06 pm
Signs Emerge that ObamaCare Enrollment Is Dropping
Posted by Ashton Ellis Print

It looks like the Obama administration’s much celebrated achievement of 8 million ObamaCare enrollments is actually dropping over time.

“The nation’s third-largest health insurer [Aetna] had 720,000 people sign up for exchange coverage as of May 20,” writes Jed Graham of Investor’s Business Daily. “At the end of June, it had fewer than 600,000 paying customers. Aetna expects that to fall to ‘just over 500,000’ by the end of the year.”

While no other insurance company has publicly reported declines as steep as Aetna, many others have not denied it is happening during recent conference calls discussing earnings.

Some attrition in ObamaCare signups is to be expected since a number of major life events could cause a change in status. Getting a new job with health benefits, for example. But the Obama administration’s refusal to publicize monthly enrollment numbers makes it impossible to get a clear picture of how well the law is working.

Which may be precisely the goal.


August 11th, 2014 at 2:24 pm
HHS to Fund Coming ObamaCare Bailout of Insurance Companies
Posted by Ashton Ellis Print

What makes conservatives so sure that the Obama administration will bailout insurance companies losing money under ObamaCare?

“According to a recent investigation conducted by the House Oversight and Government Reform Committee chaired by Darrell Issa, insurers widely expect to receive funds from the bailout program,” writes U.S. Senator Marco Rubio (R-FL). “One large insurer recently filed financial statements claiming they expect part of their revenue to come from American taxpayers via the ObamaCare bailout ‘fund.’”

Thwarted by the GOP majority in the U.S. House of Representatives who refuse to appropriate money for this part of ObamaCare, the Department of Health and Human Services “figured out a way to use general funds available through the Centers for Medicare and Medicaid Services to pay off health insurers,” says Rubio. “The effect is to circumvent Congress’ power of the purse for the purpose of bailing out health insurers with taxpayer funds.”

Whether it’s the CIA lying about spying on congressional investigators or IRS officials conveniently losing potentially damaging emails, executive branch officials in the Obama administration are destroying the ability of anybody outside their clique from being able to trust anything they say.


August 11th, 2014 at 2:11 pm
This Week’s “Your Turn” Radio Lineup
Posted by Timothy Lee Print

Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CDT to 6:00 p.m. CDT (that’s 5:00 p.m. to 7:00 p.m. EDT) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CDT/5:00 pm EDT:  Lori Lowenthal Marcus, co-founder of Z STREET — Politicization of the IRS and Z STREETS lawsuit against IRS for First Amendment violations;

4:30 CDT/5:30 pm EDT:  Mike Wendy, director of MediaFreedom — Net Neutrality;

5:00 CST/6:00 pm EDT:  Dr. Sunil Gupta, founder, chairman and chief medical officer of IRIS — Barriers to Medical Care and Access to Latest Technologies; and

5:30 CDT/6:30 pm EDT:  Quin Hillyer, political commentator and contributing editor for National Review Online — An Early Look at Elections 2014.

Listen live on the Internet here.   Call in to share your comments or ask questions of today’s guests at (850) 623-1330.


August 11th, 2014 at 9:51 am
Ramirez Cartoon: Trampled Under Foot
Posted by CFIF Staff Print

Below is one of the latest cartoons from two-time Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.


August 10th, 2014 at 10:03 am
Inversions and the Urgent Need for Corporate Tax Reform
Posted by CFIF Staff Print

In an interview with CFIF, David R. Burton, Senior Fellow in Economic Policy at the Institute for Economic Freedom and Opportunity at The Heritage Foundation, discusses why the U.S. corporate tax rate makes it difficult for domestic companies to compete in the global economy, the Obama Administration’s efforts to stop companies from incorporating overseas and the urgent need for tax reform in the U.S.

 Listen to the interview here.


August 8th, 2014 at 11:00 am
Liberty Update
Posted by CFIF Staff Print

August 7th, 2014 at 6:18 pm
Would President Romney Be Allowed to Disregard the Law?
Posted by Ashton Ellis Print

Robert Delahunty, a former Department of Justice attorney, poses an interesting counterfactual to those defending President Barack Obama’s possible legalization of 5 million illegal immigrants.

“One has to wonder how those who consider such non-enforcement to be constitutional would react if a President Mitt Romney announced that his Internal Revenue Service would simply stop collecting capital gains tax on the rich, or that his Environmental Protection Agency would no longer seek to impose legal penalties on polluters,” writes Delahunty.

Delahunty’s thought experiment is worth elaborating. If it’s true that presidents can assume lawmaking powers when Congress refuses to implement his will – a point I’m only granting for the sake of argument; Articles I and II of the Constitution clearly foreclose this possibility – then it stands to reason that any Republican running for president in 2016 can simply campaign on a promise not to enforce any law he does not like. Why worry with winning control of Congress? All any political party needs to do is win one race – the presidency – and the entire executive branch can be put in the service of the party’s platform.

It’s an outcome so at odds with our constitutional system that in saner days it would have been ruled out as a serious option as soon as it was floated. But we are in transformative times. Future presidents and their would-be advisors are taking notes. If President Obama is allowed to get away with such a regime-shattering power grab – and unilaterally importing 5 million new citizens would be just that – then there is very little reason to justify limits on even bigger abuses hereafter.


August 7th, 2014 at 3:24 pm
The Coming ObamaCare Bailout
Posted by Ashton Ellis Print

Because of ObamaCare’s mismatched incentive structure, some savvy commentators are warning of an impending, multi-billion dollar bailout of the insurance companies selling health care policies under the law.

“Pre-ObamaCare,” writes Dan McLaughlin, “insurers had to price their policies mainly by reference to market forces (albeit in an already heavily-regulated market)… Guess wrong and you lost money. But under ObamaCare, consumers no longer have the choice whether or not to buy policies, and insurance companies no longer face any risk of losing money, because they’ve been promised a bailout. Money will still be lost, but it will be taxpayer money, and you never run out of that, do you?”

McLaughlin is talking about ObamaCare’s “3 R’s” – reinsurance, risk corridors and the risk adjustment program. I’ve written about this multi-year, $20 billion bailout before. In different ways, each is designed to subsidize insurers for lost revenue traceable to the health law’s dysfunctional mandates. The threefold scheme was buried in the legislation to buy the support of large insurance companies who would have refused to participate without it.

Now the bill is coming due.

Based on interviews and documents containing discussions between Obama administration officials and insurance industry executives, a House Government Oversight report reveals that insurers are expecting the following payments:

1)      $640 million from the Risk Corridor program for the 2014 plan year

2)      $346 million from the Risk Adjustment program

The reinsurance program redistributes money among private insurance companies, as determined by the federal government.

The numbers quoted above are two to three times higher than originally anticipated because of the high level of adverse selection – i.e. too many older and sicker enrollees, not enough younger and healthier ones. The latter group is avoiding enrollment, preferring to pay ObamaCare’s relatively low penalty. But even that is a mirage. Reports are surfacing that as many as 25 million uninsured Americans are getting ObamaCare penalty waivers for next year; further increasing the federal budget deficit.

Bailouts can be nice, if they apply to you. But as a governing strategy, they eventually bankrupt the entire system.


August 7th, 2014 at 9:42 am
The Fate of ObamaCare and the Courts
Posted by CFIF Staff Print

Timothy Lee, Senior Vice President of Legal and Public Affairs at CFIF, discusses the recent contradictory federal appeals court rulings on ObamaCare subsidies and what they mean for consumers and the ultimate fate of ObamaCare.

Listen to the interview here.


August 6th, 2014 at 1:36 pm
Vermont Latest to Fire ObamaCare Website Maker
Posted by Ashton Ellis Print

After nearly a year of failed attempts, Vermont is firing CGI Federal – the company that bungled both the federal healthcare.gov and Massachusetts’ online insurance exchange – as its web designer.

“With Vermont still lacking a fully functioning health website more than 10 months after its glitch-plagued debut last October, Vermont officials said late Monday that they were pulling the plug on CGI’s CGI Technologies and Solutions’ contract,” reports Newsweek.

The decision will cost CGI almost $20 million, but at least Vermont has agreed not to sue the company for damages.

Vermont’s announcement follows several other states that have abandoned their original – and very expensive – ObamaCare websites. Some, like Nevada, Hawaii, and Oregon, are planning to cut their losses and transition to the federal healthcare.gov website. Others, like Massachusetts, Maryland, and now Vermont, are switching to new contractors hoping to recoup at least some of their investments.

Of course, there are success stories. State exchanges in Kentucky and Connecticut are routinely cited as well-functioning websites – though even these have glitches. However, the prevalence of so many high-profile failures indicates that this massive experiment in public-private partnerships has resulted in a huge transfer of wealth with precious little to show for it.


August 5th, 2014 at 7:43 pm
New Study: Pre-Release Movie Piracy Compounds Box Office Loss by 19%
Posted by Timothy Lee Print

Piracy of movies is wrong in and of itself, as it constitutes straightforward theft and deprives the creative community the right to the fruits of its labor and investment.  The sheer amount of money, time, creative energy and physical effort necessary to bring a film from concept to theaters is only possible where reliance upon return on investment exists.

For the viewing public, piracy also adds to the cost of a movie ticket.

That reality remains obvious, and the academic consensus confirms the high cost of piracy.  Of particular interest, however, is the specific issue of pre-release piracy of movies, as distinguished from post-release piracy.  In the case of post-release piracy, consumers obviously possess alternative legal avenues to see the film in question – one can view it in theaters, through legal streaming services, on DVD, etc.  Pre-release piracy, in contrast, occurs during a period in which legal options to view the film do not yet exist.  In recent weeks we witnessed an example, as the new film “The Expendables 3″ was leaked online and viewed 189,000 times in just 24 hours.

Pre-release piracy is thus a particularly pernicious form, but quantification of its damages remained relatively unexplored.

Now, however, Carnegie Mellon University professor Michael D. Smith and his colleagues have conducted a study on film piracy that occurs during that pre-release period:

Our study was accepted for publication last month in the peer-reviewed journal Information Systems Research, making it the first peer-reviewed journal article we are aware of to analyze the impact of pre-release movie piracy.  In our study we applied standard statistical models for predicting box office revenue, but added a variable for whether a movie leaked onto pirated networks prior to its release using data obtained from the site VCDQ.com.  Our analysis concluded that, on average, pre-release movie piracy results in a 19% reduction in box office revenue relative to what would have occurred if piracy were only available after the movie’s release.  As we discuss in the paper, this result is robust to a variety of different empirical approaches and sensitivity tests.”

That’s an immediate 19% loss to piracy, in addition to piracy that might occur post-release.  That’s something that no creator or investor should have to suffer, and it therefore remains imperative that we pursue existing and potential methods to combat such theft.  For the time being, however, we can thank Smith and his colleagues for helping put a number on the damage involved and illustrating the significance of the problem.


August 4th, 2014 at 2:21 pm
Obama’s CIA Caught Spying on Congress
Posted by Ashton Ellis Print

Obama’s CIA Director was caught lying to Congress about spying on a Senate investigative committee, and so far it looks like his only punishment will be an apology tour.

In March, CIA Director John Brennan took issue with a line of questioning by U.S. Senator Dianne Feinstein (D-CA) alleging that the agency had hacked into a computer system used by Senate investigators. “Nothing could be further from the truth. I mean, we wouldn’t do that,” he said.

His cover blown, Brennan is facing bipartisan calls for his resignation. Despite his earlier claim, the embattled director is hoping his apology will quiet the critics and spare him the same fate as David Petraeus, his predecessor who was hounded from office by revelations of an extra-marital affair.

I’m no fan of firing people to make a point, but one does wonder what Congress could and should do now that the CIA – an executive branch agency – has been shown to be spying on a portion of the legislative branch.

Glenn Harlan Reynolds provides some answers.

“Congress can, of course, charge Brennan with contempt of Congress, or refer him for prosecution under the False Statements Act. But in both cases, the decision to prosecute would be made by Attorney General Eric Holder, who seems to see his role not as administering justice, but as running interference for the Obama administration and protecting its officials from consequences.”

Perhaps better, then, to make the agency as a whole feel the brunt of punishment for acting badly. “Probably the best that Congress can do is to punish the entire CIA by using its budgetary power to make employees’ lives worse: Cutting back on bonuses, raises, conferences, and other perks.”

None of these answers are completely satisfying. Punishing everyone for the misdeeds of a few can be precisely as unjust as the initial bad act. The truth is we want and need competent, honest public servants whose tenure in office won’t trigger massive expenditures of time and money cleaning up their messes. Until the man in the Oval Office sets a better example for following the rule of law, we’ll likely continue to see his subordinates faithlessly executing their duties.


August 3rd, 2014 at 5:38 pm
FCC Should Focus on Releasing More Spectrum, Not Maligning Network Optimization Practices
Posted by Timothy Lee Print

Back in the days before nearly everyone possessed a cell phone, people who needed to place calls while away from home often used pay phones.  In many circumstances, it was considered common courtesy to make conversations as quick as possible, so that the next person in line could make their calls.  In crowded areas, however, some pay phones actually enforced time limits in a form of usage optimization.

Fast forward to today, with another form of optimization at issue.

In a recent letter to Verizon, Federal Communications Commission (FCC) Chairman Tom Wheeler proclaimed himself “deeply troubled” by Verizon’s announcement that it will extend its Network Optimization policy to 4G LTE devices.  “Network Optimization,” or “network management,” is not a new concept.  It enables wireless carriers to deliver the best possible service to the highest volume of customers, by optimizing the data speeds of the heaviest 5% of unlimited plan customers, but only when a specific cell site is significantly congested.  It serves as a necessary tool to ensure the best network experience for all customers, which should logically be the number one priority for wireless providers.

Under Verizon’s announced extension, customers affected will be those using a 3G or 4G LTE device on an unlimited data plan, who have fulfilled their minimum contract term, who are among the top 5% of data users and who are connected to a cell site experiencing high demand at that time.  In practice, that essentially means a person streaming a movie while playing a video game in the middle of Times Square for days on end – not the average consumer sending emails or scrolling through Facebook.

Chairman Wheeler’s letter, however, did not come as a surprise.  Unfortunately, it the type of action that we’ve witnessed all too often from President Obama’s other past FCC Chairmen.  To wit, they habitually flex their regulatory muscles and ostentatiously harass wireless providers in order to placate the 1% of digital elites, at the expense of everyday consumers.  The simple fact is that every national wireless carrier employs some similar type of network management practice, because it serves the best interest of consumers.  The US wireless market it is highly competitive, and carriers must strive to satisfy consumer demand or invite customer defection.

If Chairman Wheeler truly seeks to ensure that consumers receive the highest-quality wireless service, he would instead refocus the FCC’s best efforts toward releasing more spectrum, which constitutes a critical lifeline for the wireless industry, and which has the potential to resolve looming network congestion issues.  The FCC’s core mission is to manage spectrum – not to needlessly intervene in private market business decisions.

Accordingly, Chairman Wheeler should redirect his efforts away from government overreach designed to help the proverbial “1%” of digital elites, and more toward measures that actually matter to and benefit the 99%.


August 1st, 2014 at 10:55 am
Video: Abused By The Government? It’s Your Patriotic Duty.
Posted by CFIF Staff Print

CFIF’s Renee Giachino discusses the senseless legislative and PR push by the Obama Administration and many Congressional Democrats against U.S. corporations legally working to reduce their tax burden.  Giachino explains that the most effective way forward is to reduce the U.S. corporate tax rate – currently the highest in the developed world – so American companies can better compete in the global economy.


August 1st, 2014 at 10:30 am
Liberty Update
Posted by CFIF Staff Print

August 1st, 2014 at 7:58 am
The Arab-Israeli Conflict: Is Peace Possible?
Posted by CFIF Staff Print

In an interview with CFIF, Bruce Herschensohn, Professor at Pepperdine University School of Public Policy, author and CFIF Board Member, discusses the war between Israel and Hamas, Secretary of State John Kerry’s bungled attempt to achieve a cease-fire and President Obama’s performance on foreign policy issues.

Listen to the interview here.