Freedom Line Blog

Remember Darden Restaurants? As I blogged last year, they’re the parent company of Red Lobster, Olive Garden, and LongHorn Steakhouse that decided to codify Michelle Obama’s recommendations about nutrition in the menus of their franchises. But their latest change in corporate policy has far more ominous implications for 1600 Pennsylvania Avenue. From the Orlando Sentinel:

In an experiment apparently aimed at keeping down the cost of health-care reform, Orlando-based Darden Restaurants has stopped offering full-time schedules to many hourly workers in at least a few Olive Gardens, Red Lobsters and LongHorn Steakhouses.

Darden said the test is taking place in “a select number” of restaurants in four markets, including Central Florida, but would not give details. The company said there has been no decision made about expanding it.

In an emailed statement, Darden said staffing changes are “just one of the many things we are evaluating to help us address the cost implications health care reform will have on our business. There are still many unanswered questions regarding the health care regulations and we simply do not have enough information to make any decisions at this time.”

Analysts say many other companies, including the White Castle hamburger chain, are considering employing fewer full-timers because of key features of the Affordable Care Act scheduled to go into effect in 2014. Under that law, large companies must provide affordable health insurance to employees working an average of at least 30 hours per week.

If they do not, the companies can face fines of up to $3,000 for each employee who then turns to an exchange — an online marketplace— for insurance.

So in the course of a year, the Obama Administration has cost me my Olive Garden breadsticks and Darden employees a sizable chunk of their livelihood. I’ll be honest: the first one verges on an impeachable offense in my book. But the second one is inexcusable. It’s underemployment by legislative fiat.

So remember this fact when you hear Barack Obama tout himself as a champion of the middle class in tonight’s debate: the Darden example is representative — working Americans without healthcare and with smaller paychecks.

My column this week explains how AARP, formerly known as the American Association of Retired People, exploited its relationship with liberal politicians to reap a $2.8 billion windfall from ObamaCare.  The massive payout comes from regulatory exemptions that help AARP increase its lucrative Medigap endorsement scheme.

But it’s not like President Barack Obama’s landmark health law ushered in a new era of revenues for the premier non-profit advocate for seniors.  With $458 million in revenues for 2011, AARP would rank as the sixth most profitable for-profit health care company, according to a report by staff members to Senator Jim DeMint (R-SC).

This puts AARP just behind Humana and ahead of industry giants like Coventry, Amerigroup and Health Net.

Best of all for AARP, because it designates much of its revenue as “royalty fees” instead of “commissions” for endorsing certain private Medicare plans it gets to avoid paying taxes on millions of dollars in income to the Internal Revenue Service.

An investigation (pdf) by House Ways and Means Committee members has asked the IRS to investigate whether AARP’s reporting practices violate federal law, and for good reason.

The investigators note that “In 1994 AARP paid the Internal Revenue Service (IRS) a one-time settlement payment of $135 million in lieu of taxes, resolving an audit over tax returns for years 1985 through 1993 for failure to fully pay unrelated business income tax (UBIT) on its commercial activities.”  And, “In 1999, the IRS and AARP once again reached a settlement to conclude tax years 1994 through 1998 with respect to the treatment of revenues AARP received from licensing and selling its name and logo to insurance companies.”

Sounds like AARP merits more scrutiny from the IRS.

Dr. Barbara Bellar is running for State Senate in Illinois. That is a real shame for the Romney camp, which certainly could have used her services in the speechwriting department:

In an interview with CFIF, Congresswoman Nan Hayworth, M.D. (NY-19), the only female physician serving in Congress, discusses why repealing and replacing ObamaCare will provide immediate relief for millions of Americans who are desperate to find jobs and the need for a flatter, fairer and simpler tax code to relieve burdens on small business owners and employers, strengthen the economy and grow jobs.

Listen to the interview here.

Last week, I posted here about the fact that the growing crisis in the supply of American doctors is driven partially by structural deficiencies in Medicare. A new piece out today in the Wall Street Journal (subscription required) illuminates another key part of the puzzle: the growing tendency of doctors to refuse new patients under Medicaid — the vehicle that the Obama Administration intends to use to insure millions more Americans under Obamacare:

Some 31% of physicians in a sample of 4,326 said they wouldn’t accept Medicaid beneficiaries, economist Sandra Decker of the National Center for Health Statistics reported in an article in the journal Health Affairs published Monday. Most of the doctors cited the low reimbursement from Medicaid.

…

The health law passed by Democrats in March 2010 was supposed to expand coverage to around 16 million low-income people by signing them up for Medicaid. The Supreme Court decision in June effectively gave states the chance to opt out of the expansion. It isn’t yet clear how many will do so, although it’s likely to be a hot political issue. Either way, the coverage gained by low-income Americans could be less useful if they are unable to find a doctor to see them.

There are problems at the macro level too. Consider what Democratic(!) governors have been saying about the Medicaid expansion. Kentucky’s Steve Beshear has said “I have no idea how we’re going to pay for it.” California’s Jerry Brown has called it “devastating.” And Montana’s Brian Schweitzer — a man often touted by Democrats as a potential presidential candidate — has warned, ” I’m going to have to double my patient load and run the risk of bankrupting Montana.”

As Thomas Sowell is fond of saying, one of the hallmarks of liberalism is judging intent rather than outcomes when it comes to public policy. Thus do we get decades-long wars on poverty that do next to nothing for the impoverished, and stimulus programs of which it is always claimed that they would have worked if they only been a little bit bigger.

I’m not sure the abject failures of Obamacare will get a free pass based on good intent though. Theses sorts of consequences — patients unable to find doctors, states teetering on the verge of bankruptcy — are nearly impossible to ignore … no matter how desperately the White House will try.

Over the weekend a New York Times profile of my (and Ashton’s) hometown of Riverside, California sounded the alarm over the crisis-level shortfalls of doctors practicing in America. For a publication as married to do-gooder liberalism as the Times, it’s tone was surprisingly fatalistic:

The Association of American Medical Colleges estimates that in 2015 the country will have 62,900 fewer doctors than needed. And that number will more than double by 2025, as the expansion of insurance coverage and the aging of baby boomers drive up demand for care. Even without the health care law, the shortfall of doctors in 2025 would still exceed 100,000.

Health experts, including many who support the law, say there is little that the government or the medical profession will be able to do to close the gap by 2014, when the law begins extending coverage to about 30 million Americans. It typically takes a decade to train a doctor.

Well, there is at least one thing the feds could do: get out of the way. A helpful explainer from the Heartland Institute shows how badly government distorts the market for doctors:

[The Heritage Foundation’s Kathryn] Nix points out that when Congress passed the 1997 Balanced Budget Act, it included a cap on the number of residency positions Medicare is allowed to fund. The step wasn’t controversial at the time, and in fact it had the support of multiple organizations, since concerns abounded at the time that the United States had an oversupply of physicians.

Since then, the number of residency positions funded by Medicare has remained unchanged, capped at 1996 levels despite exploding population growth and increased demand. Groups such as the Association of American Medical Colleges (AAMC) and the American Medical Association (AMA) have since changed positions and now support increasing the 1996 cap or eliminating it entirely.

“The biggest concern is that the demand is going up as the population ages,” Nix continued. We’re going to have more people on Medicare, elderly who need more medical attention. The new health care law will exacerbate the problem, first of all by increasing and subsidizing demand, but several of the provisions of the new law will discourage physicians from staying in the profession and will discourage young people from joining it.”

An utterly avoidable human tragedy, bred by ignorance. Who could’ve anticipated that capping supply would lead to shortages? Anyone who’s ever cracked a basic economics textbook, that’s who. We can argue over the proper methods for restructuring Medicare, but it should be obvious that “restrict the number of doctors and leave everything else the same” isn’t going to cut it.

And this is just the tip of the iceberg. As has been widely noted, Obamacare’s virtually indestructible Independent Payment Advisory Board has the potential to morph into precisely the kind of “death panel” Sarah Palin warned about.

Bureaucratic incompetence has long been a bugbear of conservatives. But the day is soon arriving when the bean counters will go from costing money to costing lives.

When one tries too hard to be popular, the result is usually less popularity.  That appears no less true when it comes to the Supreme Court.

Last week, we highlighted how public approval of the Supreme Court instantly plummeted following last month’s ObamaCare decision.  One week prior to the Court’s decision, twice as many people – 36% to 17% – believed that the Court was doing a “good” or “excellent” job as opposed to a “poor” job.  In the immediate aftermath of that decision, almost as many said that the Court was doing a “poor” job as a “good” or “excellent” job.  Additionally, over twice as many Americans – 56% to 27% – now believe that the justices pursue political agendas as opposed to maintaining impartiality.

As reported by The Hill, a poll this week confirms that backlash:

Negative opinions of the Supreme Court jumped in the wake of its ruling on the constitutionality of the 2010 health care law, according to a new Pew Research Center poll released on Thursday that shows the percentage who have an unfavorable opinion of the Court is higher than at any point since Pew began tracking it in 1985.”

And that’s not just among Republicans.  According to the poll, disapproval among independents increased while approval remained unchanged.  That’s not good news for Barack Obama, and it certainly doesn’t reflect well on Chief Justice John Roberts’s apparent attempt to sacrifice judicial prudence at the altar of popularity.

The U.S. House of Representatives voted 244-185 this afternoon to repeal ObamaCare. 

Five Democrats joined all Republicans in the House to support the repeal measure.  The five Democrats included:

• Rep. Jim Matheson (D-UT)
• Rep. Larry Kissell (D-NC)
• Rep. Mike McIntyre (D-NC)
• Rep. Mike Ross (D-AR)
• Rep. Dan Boren (D-OK)

McIntyre, Ross and Boren all voted for repeal in 2011.  Matheson and Kissell, both facing tough reelection fights, voted against repeal last year and changed their votes today.

Pulitzer Prize-winning historian David Maraniss’ new book, Barack Obama: The Story documents nearly three dozen instances where the President misstated facts about his life in Dreams From My Father.

Among other defenses of Obama’s deliberate misstatements reported by Fox News’ James Rosen, this one takes the cake:

Gerald Early, a noted professor of English literature and African-American studies at Washington University in St. Louis, agreed. “It really doesn’t matter if he made up stuff,” Early told Fox News. “I mean, after all, it’s like you going to a psychiatrist and you make up stuff, and the psychiatrist can still psychoanalyze you because they’re your lies.”

My only regret is that Professor Early didn’t tighten up his argument so it can fit on a bumper sticker because it perfectly captures so much of what’s wrong with modern liberalism’s catechism.

Then again, maybe “It really doesn’t matter if Obama made up stuff…” could be understood to mean:

“…since he already got elected.”

“…because he can count on the Supreme Court to bail him out.”

“…because comprehensive health care reform is a BFD.”

“…since voters don’t care about integrity, just a President who can slow jam the news.”

If the Supreme Court’s ObamaCare decision hasn’t made you so despondent as to write off the topic of health care altogether, then you owe yourself a stop by the American Enterprise Institute’s online magazine, The American, where Cliff Asness has managed the near-impossible: writing a comprehensive overview of the defects of the American system that is breezy, informative, and, at times, laugh-out-loud funny.

Asness has as his goal debunking four common myths about American health care:

1. Health care prices have soared in the recent past
2. The pre-ObamaCare system was ‘insurance’
3. Stopping insurance companies from charging based on pre-existing conditions is the one good part of ObamaCare
4. Healthcare costs are very high in the United States compared to socialist countries

Asness’ deconstruction of every point is thorough, illuminating, and crystal clear. In fact, it’s safe to say that — if you haven’t been introduced to these arguments before — you’ll never think about health care the same way again. Here’s one example, hailing from section two, on ‘insurance’:

Due primarily to the tax subsidy given to employer-provided healthcare (a bipartisan, so-far-untouchable disaster), catastrophic health insurance is not Americans’ norm. Rather, employers provide essentially all healthcare from basic health maintenance and symptom relief to the most expensive life-saving procedures, and they do it because the government massively subsidizes this approach.

This is odd. You don’t go to your car insurer to fill your car with gas or to your homeowner’s insurance company to change a light bulb. Why do you go to your health insurance company for everyday medical services? That is not insurance, it is tax-subsidized provision of all your healthcare needs, and it causes two of our system’s biggest problems. 1) Health coverage is not portable, as it’s employer-provided, and 2) consumers are insulated from the cost of basic healthcare because they don’t pay directly for services. Educated consumers spending their own money would be far better shoppers for healthcare. Also, I wish I wasn’t asked for a $5 co-pay after a doctor’s appointment. Ask me to pay at least $200 or nothing. Paying $5 for a prostate exam is demeaning to both parties.

The conservative/libertarian intelligentsia has plenty of deeply-schooled policy wonks and plenty of engaging writers. But very rarely to both skill sets belong to the same author. Cliff Asness is the rare exception. Read it and grow wise.

I’ll join the scrum on this one, though in a much less organized fashion than either Ashton or Quin. Insulated as it is from direct political pressure, the Supreme Court’s actions are always much harder to predict than those of the other two branches, so I’ll offer a few thoughts rather than predictions:

• The now widely-held belief that Chief Justice Roberts is writing the majority opinion makes me nervous. The positive interpretation is that some or all of Obamacare is going to be struck down and that Roberts — ever-mindful of public perception of the Court’s legitimacy — is writing it to ensure the widest possible acceptance of the ruling. On the other hand, if Justice Kennedy drifted over to the left on this decision, this could be a 6-3 ruling upholding Obamacare, with Roberts switching only so he could write the opinion and blunt the damage done by the majority.

• If the individual mandate is struck down but found to be severable from the broader law, the health insurance market is going to be thrown into absolute chaos. There’s a reason that insurers themselves were lobbying so hard for the mandate — it’s the only thing that backfills the tremendous costs being imposed on them by the rest of the legislation. The combination of an explosion in costs with likely attempts by HHS to enact price controls will put American health care in a death spiral — itself a good reason to find the provision severable.

• I’m of the opinion that, as a political calculation, having only the mandate struck down is the worst possible outcome for Republicans. If the entire law is upheld, then the GOP and the Romney camp get to run the fall campaign on the message that only electing a Republican president and Republican majorities capacious enough to achieve repeal will be sufficient to get rid of Obamacare. If the entire thing is struck down, then the work is done. But the mandate is the most unpopular portion of the law and if the Court strikes it down while leaving all of the popular components (read: the benefits — like prohibiting insurance denials based on pre-existing condtions or guaranteeing eligibility to be on your parents’ health insurance until the age of 26), it’s entirely possible — and perhaps likely — that the public opposition will be defanged while many of the most pernicious effects of the law remain.

• One final thought: Regardless of whether he’s part of the majority opinion or the dissent, I sincerely hope that Justice Thomas uses this historic opportunity to write a separate opinion on Commerce Clause jurisprudence that can be called on by his proteges in years to come.

God bless New Hampshire, an outpost of sanity in otherwise deep-blue New England. In keeping with the Granite State’s strongly libertarian political culture, New Hampshire’s legislative Republicans led a charge to prevent the state from implementing a health insurance exchange program under Obamacare. The result: the state’s Democratic governor buckled. From the state’s free-market think tank, the Josiah Bartlett Center for Public Policy:

Governor John Lynch this morning signed legislation blocking implementation of a health insurance exchange in New Hampshire. The Obama Administration has been urging states to set up exchanges under the Patient Protection and Affordable Care Act, known as ObamaCare.

Lynch has supported setting up a New Hampshire exchange, including the proposal in his State of the State address in February. Senate legislation setting up an exchange, SB 163, won Committee approval in January before stalling on the Senate floor. Opponents argued that a state-run exchange would put New Hampshire taxpayers on the hook for the costs of administering much of the federal health care law, while giving the state little flexibility from federal mandates.

New Hampshire’s state motto — perhaps the nation’s most iconic — is “Live Free or Die.” It’s nice to know that those are more than just words on a license plate.

h/t: Adam Freedman at Ricochet

Remember when Obama  solemnly and repeatedly promised that “if you like your insurance plan, your doctor, or both, you will be able to keep them?”

If not, don’t beat yourself up.  He has broken so many promises that no reasonable person can keep tally.

But score another casualty to ObamaCare specifically.  According to The Wall Street Journal, college students should expect their plans to become more expensive or disappear altogether:

“Some colleges are dropping student-health plans for the coming academic year and others are telling students to expect sharp premium increases because of a provision in the federal health law requiring plans to beef up coverage.  The demise of low-cost, low-benefit health plans for students is a consequence of the 2010 health care overhaul.  The law is intended to expand coverage to tens of millions of uninsured Americans, but it is also eliminating some insurance options.”

Moreover, that consequence will likely be widespread:

“The new rules are likely to affect a broad swath of American colleges.  Some 60% of schools’ plans had coverage of $50,000 or less for specific conditions, and almost all of the rest have some sort of payout caps that they will have to do away with by 2014, the GAO study found.”

And the Obama Administration’s response?  They apparently couldn’t care a whole lot less.  “The Obama Administration,” the report notes, “argues that the most limited benefit plans colleges previously offered hardly counted as coverage at all.”

Yeah, that should motivate the youth vote for Obama just like those vapid, naive days of 2008.

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.

Reason has a great review of a new book on the Obama economic advisers who tried and failed to spend and regulate the economy into recovery.  But for all the space devoted to those around President Barack Obama, it’s the way he treats them – and wants them to treat him – that is most disturbing:

But Obama was not exactly a man without a team. He was loyal to the cult of policy smarts. He may have even been its high priest. As Scheiber reports, outside analysts reporting to the president were advised to highlight their expert credentials so he would know he wasn’t talking to cranks and dummies. Obama also wanted his inner circle to credit his own abilities: The president, Scheiber writes, “craved intellectual affirmation” and often badgered his lieutenants into acknowledging when his own ideas were perceived to have succeeded. Obama “had a habit of prompting his aides to acknowledge his wisdom and foresight,” Scheiber writes. The president would sometimes wonder aloud, “Whose idea was that?” when he deserved credit.

Whatever is Obama’s conscious motivation for overemphasizing credit and credentials at every turn, this window into his personality reveals a deeply insecure person.

Remember, this is the same man who’s boasted about being a better campaign manager than the one he employs, a better speechwriter than his scribes, and so on.

If this is the way the President wants to play it, why not let him own every decision by his administration?

$787 billion in stimulus spending and no change in the unemployment rate – Whose idea was that?

A federal takeover of the health care industry that raises the deficit while reducing services – Whose idea was that?

Selling thousands of guns to Mexican drug cartels so they could be traced to crime scenes – Whose idea was that?

The list could go on and on and on…

So ubiquitous is coverage of presidential candidates in this 24-hour news cycle era — and so pervasive is the numbness that results — that it’s easy to lose sight of some truly bizarre developments in this year’s election cycle; developments that have seen their novelty rusted away by saturation coverage.

Among them: the signature achievement in the political career of Mitt Romney, the almost certain Republican nominee for president (especially with Rick Santorum leaving the race today), is so deeply unpalatable to conservatives that it even divides his advisers. Consider this, from Politico:

Two of the five members of [Mitt] Romney’s recently announced Health Care Policy Advisory Group have a record of opposition to his Massachusetts health care reform plan.

Paul Howard, a senior fellow at the Manhattan Institute and a new addition to Romney’s advisory team, wrote in late 2010 that Romney’s plan has resulted in a dramatic increase in insurance costs for small businesses.

He also said it’s “no secret” that the state plan was the “template” for President Barack Obama’s federal health care law.

Scott Atlas, a senior fellow at the Hoover Institution and another new Romney health adviser, was sharply critical of Romney’s health plans in 2007 while Atlas was supporting New York Mayor Rudy Giuliani’s presidential campaign.

“Mitt Romney’s legacy is the creation of a multibillion dollar government health bureaucracy that punishes employers and insists middle income individuals either purchase health insurance or pay for their own health care,” Atlas told reporters. “The former is a mandate, the latter is a tax and neither one is free market.”

Lest the point be oversold, we should note that past Republican nominees have accessorized their necks with similar albatrosses. John McCain, for instance, was the co-author of a federal campaign finance law loathed by conservatives because it is inimical to political free speech. But there’s still a slight difference: Romney’s policy liability deals with one of the defining issues of the election he’ll be running in — and it also happened to be the intellectual predicate for his opponent’s crowning legislative achievement.

Virtually all the energy that has animated the conservative movement over the last three years — energy best exemplified by the Tea Party — has come in reaction to Obamacare and the government overreach it represents. Now the Republican Party will march into electoral battle behind the progenitor of that intrusion. We live in strange times.

Remember in 2009 when conservatives in Congress presented an alternative to ObamaCare that would have guaranteed bipartisan support for some of the outcomes the Obama White House and its liberal allies wanted?  Had the liberals concentrated on targeted reforms instead of a gargantuan“comprehensive solution” not only would the ultimate bill have been much shorter, it would have been much easier to read and comprehend.

That’s a point worth considering since judging by the comments from the Supreme Court this week, passing health reform piecemeal would have been a far better strategy for those wanting to salvage the legislation.

Due to ObamaCare’s massive size, Byron York notes that none of the Justices actually admitted reading the entire law.  “I haven’t read every word of [the law], I promise,” said Justice Stephen Breyer on Wednesday.  Justice Antonin Scalia’s comments to an attorney defending the law were more pointed: “You really want us to go through these 2,700 pages?”  “You really expect the court to do that?”

The problem for ObamaCare’s defenders is that the Justices’ refusal to read the entire law means that they are much less likely to rule the individual mandate unconstitutional and keep the rest.  Instead, they’ll just invalidate the whole thing and have Congress start over.

If that happens, the liberal mania for “comprehensive” solutions for everything from illegal immigration to financial transactions and health care will be dealt a much-deserved blow.  You can’t interpret what you can’t define.

If the Court strikes down ObamaCare in its entirety liberals will have only themselves to blame.  Had they listened to conservatives, some of the popular aspects of ObamaCare – guarantees of coverage and subsidies for premiums – would likely be in place with bipartisan support.  Now, they may have nothing to show for what could ultimately end up being a massive waste of time and money.

With the Supreme Court getting ready to hear arguments about the (un)constitutionality of ObamaCare, House Republicans yesterday voted to repeal the Independent Payment Advisory Board (IPAB), one of ObamaCare’s provisions that may be left unaffected by the Court’s decision.

As the Washington Times reports, this is “the 26^th time the House has voted to partially or completely repeal the sweeping overhaul” of the health care industry.

Like the other 25 times, this House vote won’t be seconded by the Democratic controlled Senate.  But in an election year that’s hardly the point.  What matters right now is that House Republicans continue to highlight how elements like IPAB destroy freedom and choice in health care by letting 15 unelected bureaucrats instead of the free market decide the price of services.

On to number 27!

House Budget Committee Chairman Paul Ryan (R-WI) this morning is releasing the House GOP budget proposal.  Ryan previews his budget in an op-ed in The Wall Street Journal here, and outlines the “choice of two futures” — the status quo of more debt and greater decline vs. a path to prosperity that includes less debt, lower taxes and inidividual opportunity — in the web video posted below.

Newsmax.com reports:

The gross costs of the national healthcare law rammed through Congress by President Barack Obama will reach an estimated $1.76 trillion over 10 years – nearly twice the amount originally projected.

The figure, which the Congressional Budget Office (CBO) revealed on Wednesday, is bound to cause embarrassment to the administration as it comes just as debate on ‘Obamacare’ is starting to heat up again, two weeks before the Supreme Court is set to hear arguments on whether the Affordable Care Act is unconstitutional.

Truth be told, nearly everyone already knew that the cost estimates used to sell ObamaCare to the American people were part of the White House shell game to get it passed.  That much is understood by both supporters and opponents of ObamaCare.  What is embarrassing is the administration’s response to the latest CBO estimate.

‘The bottom line is clear: the Affordable Care Act will reduce our deficit, control health costs and make health care more affordable,’ Jeanne Lambrew, deputy director of the White House office of Health Reform, wrote on the White House blog.

Remember, this is the same White House trying to convince you that algae is the answer to rising gas prices.