Freedom Line Blog

Here in Southern California, the biggest development in recent weeks has been the announcement that hyper-liberal congressman Henry Waxman — who’s held a House seat from the Los Angeles area for 40 years — is finally stepping down at the end of the current session.

Given how long Waxman has dominated the politics of the area, it’s no surprise that there’s a long list of candidates lining up to succeed him. There’s another reason, however, for the glut of competition: this is an enormous district of wildly divergent communities. In my weekly column for the Orange County Register, I argue that this stems from a mistake in how we’ve organized the lower chamber for the past 85 years:

The physical distance between the northwestern edge of Waxman’s 33rd District, in Malibu, and its southeastern terminus, in San Pedro, is more than 40 miles. The cultural difference can only be measured in light years. The South Bay, the Westside, the Conejo Valley, and the coastal refuges of Pacific Palisades and Malibu are all worlds unto themselves, populated by citizens who view themselves as distinct from one another. The idea that they should all be represented by one person in Congress makes a mockery of the notion that House districts represent discrete, coherent communities.

That sort of absurdity is inevitable, however, given the fact that the House was severed from its original purpose 85 years ago, when Congress passed the Reapportionment Act of 1929. That law fixed the number of seats in the House of Representatives at 435, dictating that the available seats would be redistributed among the states based on population changes in each census, instead of adding new ones, which had been the historical practice (the House had grown to 435 from its original number of only 65). As a result, the average House district now consists of over 700,000 people – a far cry from the original system, where there was one representative for approximately 33,000 souls.

Whoever inherits Waxman’s seat will represent more people than the U.S. senators from the states of Wyoming or Vermont. Were the ratios employed by the founders still in use today, California’s 33rd Congressional District would actually be split into 21 discrete House seats.

Returning to that standard may be overkill; it would swell the ranks of the House of Representatives to over 9,500 members. Some expansion, however, is surely justified to create House districts small enough to actually represent something like the will of a coherent community. Until such changes are made, the notion of the House as the “people’s chamber” will be little more than a touch of historical nostalgia.

I’ll also note that having an enlarged House would (A) make it harder for special interests to capture critical masses of legislators and (b) have the practical effect of making it cheaper to run for Congress and allowing more true citizen-legislators to emerge. In short, it would make it harder to consolidate power in Congress—which is precisely why most sitting lawmakers won’t support it…and why it’s the right thing to do.

Today marks the 40^th anniversary of Earth Day, now being celebrated in 190 countries by an estimated 1 billion people.  To put that in perspective, that number is roughly the amount of adherents claimed by the Roman Catholic Church.  And as Robert Nelson points out in the Detroit News, the environmentalism movement that birthed Earth Day has turned into its own religion.

America’s leading environmental historian, William Cronon of the University of Wisconsin, calls environmentalism a new religion because it offers “a complex series of moral imperatives for ethical action, and judges human conduct accordingly.”

In other words, issues such as climate change are now much more than about “science.”

And this places a greater burden on environmental theology than it is often able to handle. Success in stirring powerful religious feelings about the environment does not automatically lead to wise and effective policies.

But that’s not stopping Rep. Henry Waxman (D-CA), Chairman of the House Energy and Commerce Committee, from pleading for a comprehensive climate change bill, a measure that will take the price distorting regulations on gas prices and impose them on every other energy sector.

Americans don’t need to pay more for less energy, Chairman Waxman.  Pass this bill and we’ll see if your eco-gods can deliver you from the voters’ wrath this November.

Within days of ObamaCare’s passage, AT&T, Caterpillar and other American employers announced hundreds of millions of dollars in earnings writedowns pursuant to U.S. accounting laws.  Although Democrats falsely claim that these restatements are mere political attacks aimed at Barack Obama, the simple fact is that they are legally required to report the corporate costs of ObamaCare’s tax increase on the retiree drug benefits that they pay each year. Specifically, the Financial Standard Accounting Board’s 1990 Statement Number 106 mandates earnings restatements due to anticipated future retiree liabilities.  If these employers did not report the writedowns, they’d be prosecuted.

The most despicable reaction of all, however, may be that of two Congressmen who played a critical role in imposing ObamaCare in the first place.  Henry Waxman (D – California) and Bart Stupak (D – Michigan), those two profiles in cowardice and malevolence, have now demanded the CEOs of AT&T, John Deere, Caterpillar and Prudential appear to justify themselves before their committee.   According to their letter, “the new law is designed to expand coverage and bring down costs, so your assertions are a matter of concern.”

In other words, who are you going to believe – Henry Waxman, Bart Stupak, Barack Obama and their doctored Congressional Budget Office predictions, or your own actual bottom line and real-world numbers? Every person with a grain of sense anticipated the negative consequences of ObamaCare, but such effects seem to have blindsided ObamaCare’s advocates.

More generally, who are Henry Waxman and Bart Stupak to be hauling the CEOs of some of America’s most valuable and successful companies to Capitol Hill to explain themselves?  Shouldn’t it be the other way around?  How many jobs have Waxman and Stupak created in their lives compared to AT&T, Caterpillar, John Deere and others?  How many successful products have Waxman and Stupak contributed to the world economy and human progress?  Why aren’t the CEOs the ones hauling Waxman and Stupak to explain their retrograde economic views and the destruction that they are wreaking on America, rather than vice-versa?  Why aren’t Waxman and Stupak explaining their toxic behavior to a nationwide audience?

We live in an increasingly Orwellian era, and the sheer weight of absurdity may soon cause a snap.

During today’s health care summit at Blair House, Wyoming Republican Senator John Barrasso (an orthopedic surgeon by trade) dropped the jaws of Democrats in attendance by declaring that individuals who only have “catastrophic care” health insurance (which Democrats had been spent all day citing as a moral failure) often make better medical decisions than people with more comprehensive plans. Barasso’s reason was simple — these consumers actually have to consider the cost of their treatments.

Though President Obama and Congressman Henry Waxman were quick to ridicule Barasso, he got to a truth that is at the very root of meaningful health care reform: the system can’t work as long as consumers are being insulated from costs.

Two economic maxims suffice to make the point: (1) “If you’re paying, I’ll have the steak” — There is no incentive to keep your spending under control when someone else is footing the bill (2) “No one washes a rental car” — Ownership is the best motivation for vigilance, because if something goes wrong, you’ll be the one eating the costs. Having someone else shield you from health care expenditures only weakens your incentive to be vigilant in regard to your own well-being

Earlier in the day’s proceedings, Obama and Democratic Senator Dick Durbin of Illinois rained on the tort reform parade by claiming that the $5 billion a year that could be saved by reforming the malpractice system would be a drop in the $2 trillion health care bucket (as an aside, I’ve always thought this is a bizarre rationale — how can anyone expect to realize large savings if they ignore all the incremental savings that will get them there?). Yet if tort reform was too picayune, why are Democrats ignoring Barrasso’s point, which got to the heart of what drives health care costs through the roof?

The problem with modern health care is that is built on a triangular model. In most cases, one person pays for the care (an employer), one person consumes the care (the patient) and one person provides the care (the doctor). This is a recipe for unhappiness and inflation, because the person who consumes is unaccountable to the person that pays, and the person that provides is unaccountable to the person they provide for (Harvard’s Regina Herzlinger has been invaluable on this point).

The Republican talking point is that health care needs to be reformed in small, incremental chunks. That may be a sound legislative strategy, but it’s not true as a matter of policy. The system needs to be fundamentally reformed and placed on a consumer-driven basis (and yes, conservatives, you can learn from Europe — Switzerland has a pretty good model. If you’re really in the mood for right-wing apostasy take a gander at Whole Foods’ ideas too). Subsidies are always going to be necessary for the indigent, but more far-reaching government control is not the answer. Comprehensive reform that makes health care market-driven is.

Byron York posts a great article today culled from his discussion with an anonymous Democratic strategist. The topic is the rationale motivating Democrats to pass comprehensive health care “reform” over the vociferous objections from a majority of the public. For the White House, it’s the fierce urgency of now. In the Senate, it’s the calculation that senators vulnerable in next year’s election will be at risk of losing their seats with or without passing the bill. And in the House, it’s the belief by party stalwarts like Henry Waxman (D-CA) and Speaker Nancy Pelosi (D-CA) that the 20 or 40 members likely to be defeated because of the bill are nominal players.

But when pressed by York to explain why Democratic leaders keep pushing for something a majority of the public doesn’t want, his interlocutor reveals the essence of the liberal conceit.

“Because they think they know what’s best for the public,” the strategist said. “They think the facts are being distorted and the public’s being told a story that is not entirely true, and that they are in Congress to be leaders. And they are going to make the decision because Goddammit, it’s good for the public.”

How democratic.

Remember when sub-prime mortgages had Congress demanding more accountability (i.e. oversight) of the housing industry? It seems like a lifetime ago that the spark igniting the current recession (derivatives of risky mortgage deals) was a priority on Congress’s to-do list. That was before health care, cap-and-trade, and Afghanistan moved it to the back burner. Apparently, the issue is still simmering because there’s news of an impending compromise between Henry Waxman (D-CA) and Barney Frank (D-MA). At issue is whether to head the yet-to-be-created “Consumer Financial Protection Agency” (CFPA) with a single director or board of commissioners.

And just what would be the CFPA’s mandate? Here’s a description from the L.A. Times:

To begin with, be aware that the agency’s powers and oversight would extend far beyond mortgages and real estate — into all credit cards, debit cards, consumer loans, payday loans, credit reporting agencies, debt collection, stored-value cards and even investment advisory and financial advisory services, to name only part of the list.

And this from CNN:

The consumer agency would be a brand new regulator whose chief concern is looking out for consumers. It would write rules aimed at ensuring that financial products like mortgages and credit cards are fair, more transparent and more easily understood.

Raise your hand if you remember the last time a government agency made a process, form, or program easier to understand. At the end of the day, it doesn’t matter if the new regulator is a single director or a board of commissioners. The most direct effect of creating yet another federal agency will be an increase in both taxes to fund it and transactions costs to comply with it. If Democrats really wanted to help consumers and taxpayers, they’d step back and let prosecutors and plaintiffs sue for fraud. After all, no court will enforce a contract that was signed under duress.

Then again, that’s not really the point, is it?