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Posts Tagged ‘Reform’
April 17th, 2013 at 6:45 pm
Immigration Reform Snarled by ObamaCare?

Hat tip to Investor’s Business Daily for pouncing on what will be a very unpopular unintended consequence of passing the Senate Gang of Eight’s immigration reform bill:

Under the immigration reform bill, some employers would have an incentive of up to $3,000 per year to hire a newly legalized immigrant over a U.S. citizen.

In avoiding one controversy — the cost of providing millions of newly legalized immigrants with ObamaCare subsidies — the Senate “Gang of Eight” may have risked walking into another.

The bipartisan legislation released Wednesday dictates that those granted provisional legal immigrant status would be treated the same as those “not lawfully present” are treated under the 2010 health law.

That means they would neither be eligible for ObamaCare tax credits nor required to pay an individual tax penalty for failing to obtain qualifying health coverage. It also means some employers would face no penalty for failing to provide such workers affordable health coverage.

So, in order to avoid the charge that legalization would give illegal immigrants citizen-like access to ObamaCare subsidies, the Gang of Eight simply bars them from access. But that means that legalized immigrants are cheaper to hire than comparable native-born workers who will be competing with more people for less jobs.

There may be a fix, but it will be messy.

Good luck with that.

April 16th, 2013 at 1:46 pm
Legalization Bad for Low-Income Native Workers?

Now that the Gang of Eight’s immigration reform bill has been slowed down a bit, it’s worth pausing for a moment to consider what economic trade-offs might occur if millions of illegal immigrants become eligible to enter the job market. Since many of these newly eligible workers are low-skilled, they’ll be competing with low-skilled, low-wage native workers in an economy with 7.6 percent unemployment.

Members of the U.S. Commission on Civil Rights are taking notice, says Byron York:

Last week, three members of the U.S. Commission on Civil Rights wrote to Ohio Democratic Rep. Marcia Fudge, chairman of the Congressional Black Caucus, arguing that legalizing currently illegal immigrants will have far-reaching effects on African-Americans.

“Such grant of legal status will likely disproportionately harm lower-skilled African-Americans by making it more difficult for them to obtain employment and depressing their wages when they do obtain employment,” the commissioners wrote. “The increased employment difficulties will likely have negative consequences that extend far beyond economics.” Among those consequences, according to the commissioners: increased crime, incarceration, family breakdown, and more.

A recent review of the academic literature by Harvard economist George Borjas confirms the negative impact mass legalization will have on low-skilled native wages:

For American workers, immigration is primarily a redistributive policy. Economic theory predicts that immigration will redistribute income by lowering the wages of competing American workers and increasing the wages of complementary American workers as well as profits for business owners and other “users” of immigrant labor. Although the overall net impact on the native-born is small, the loss or gain for particular groups of the population can be substantial.

The best empirical research that tries to examine what has actually happened in the U.S. labor market aligns well with economy theory: An increase in the number of workers leads to lower wages.

If you increase the supply of something, you lower its value. If they want a way to frame opposition in positive terms, expect to see Republican opponents of the Gang of Eight’s reform bill to become the champions of the forgotten working class.

April 10th, 2013 at 5:24 pm
Gang of Eight Border Strategy: Let DHS Decide

The New York Times is reporting that new details are emerging about the border security component of the Senate’s bipartisan, self-appointed “Gang of Eight” plan for comprehensive immigration reform.

The following is particularly interesting:

According to the draft, the legislation would provide $3 billion for the Department of Homeland Security to draw up and carry out a five-year border security plan. Officials must present the plan within six months, and no immigrants can gain any provisional legal status until the plan is in place.

The plan must include how border authorities will move quickly to spread technology across the border to ensure that agents can see along its entire length. The authorities will also have five years to reach 90 percent effectiveness in their operations, a measure based on calculations of what percentage of illegal crossers were caught or turned back without crossing.

Homeland Security officials also have six months to draw up plans to finish any border fencing they deem necessary.

The problem with this proposal is that it puts the responsibility and the discretion over how to secure the border in the hands of the very people who are committed to keeping them open.

As I wrote last week, the Department of Homeland Security is refusing to create a metric to track border security. According to White House aides, that’s because President Barack Obama doesn’t want a distracting – and damning – focus on DHS’s failure to capture more than half of illegal border crossers to derail his push for legalization and amnesty.

Simply giving DHS $3 billion to do a job it is already on record as refusing to do is nonsensical.

Now that Congress has found the one area where the Obama administration refuses to regulate, it’s time for the people’s representatives and senators to get back in the game and pass a border security program that specifies in detail what DHS’s job is, and puts in serious penalties for refusing to implement the law.

April 9th, 2013 at 5:21 pm
Obama DHS Caught Misleading Congress About Border Crossing Data

Here’s everything you need to know about the corruption of border security under Obama’s Department of Homeland Security, helpfully summarized in two stats and one quote by Byron York.

“According to internal reports, Border Patrol agents used the airborne radar to help find and detain 1,874 people in the Sonora Desert between October 1 [2012] and January 17 [2013],” reported the Los Angeles Times last week. “But the radar system spotted an additional 1,962 people in the same area who evaded arrest and disappeared into the United States.”

That means officers caught fewer than half of those who made the crossing in that part of Arizona. If those results are representative of other sectors of the border, then everything the administration has said about border security is wrong.

“These revelations are in stark contrast to the administration’s declaration that the border is more secure than ever due to greater resources having been deployed to the region, and that lower rates of apprehensions signify fewer individuals are crossing,” Rep. Michael McCaul, chairman of the House Homeland Security Committee, wrote in an April 5 letter to Homeland Security Secretary Janet Napolitano.

New information is coming to light almost daily as members of Congress try to assess whether the federal agencies responsible for ensuring the integrity of America’s borders are, in fact, doing their job.

These revelations of malfeasance are compounded by the secretive deliberations of the so-called “Gang of Eight” as they haggle over an estimated 1,500 page version of comprehensive immigration reform that Democrats are trying to rush through the Senate without formal debate.

The more we learn about how badly the Department of Homeland Security is failing to police the border, the less congressional Republicans should entertain any thoughts about comprehensive immigration reform.

April 9th, 2013 at 2:35 pm
Jindal “Parks” Controversial Income-for-Sales Tax Swap

With opposition from Louisiana’s business and religious communities, as well as resistance from Republican state lawmakers, Governor Bobby Jindal announced he will “park” his plan to replace the state’s income tax with a higher sales tax.

The devil was in the details, says Josh Barro, a Bloomberg economics and financial writer.

The other problem was that Jindal’s method of tax-base expansion was not very sensible. An ideal sales tax should apply to all consumption exactly once, meaning it should include business-to-consumer transactions and exclude business-to-business transactions. Taxing transactions between businesses leads to “tax pyramiding”: a sale is taxed multiple times before reaching the final consumer, meaning the tax embedded in the price far exceeds the actual tax rate. This is unfair and also inefficient, because it punishes businesses that choose not to vertically integrate: If I run a restaurant, my customers pay more tax if I buy my pastries from a third-party baker than if I bake them myself. (Depending on how my state taxes pastries.)

Jindal’s administration was bragging that his plan would cause lots of tax pyramiding. An official in Jindal’s department of revenue told the Louisiana House Ways and Means Committee that 80 percent of the new sales tax on services would be borne by businesses. This announcement was meant to be an explanation of how the plan could cut taxes on individuals in all income brackets. But it caused yet two more problems. One, it led the Louisiana Association of Business and Industry, normally friendly to Jindal, to come out against the plan. Two, it undermined the case for reform: Sales-tax base broadening is supposed to make the tax base more ideal, but Jindal was effectively announcing that it would not.

For conservatives, it is part of Economics 101 to remind liberals that all taxes paid by businesses get passed on to consumers.  With a statewide popularity rating now lower than President Barack Obama’s, it’s too bad the very bright Governor Jindal had to (re)learn that lesson the hard way.

April 5th, 2013 at 3:52 pm
HHS Refuses State Requests for Medicaid Expansion Flexibility

States looking for flexibility under ObamaCare in how to structure and pay for expanding Medicaid can take a hike, according to an analysis by the Heritage Foundation.

States like Arkansas and Indiana have requested waivers from the health reform law’s expansion formula that creates millions of new enrollees at an eventual cost of billions of dollars to states.

The hope was to use existing state-based models like Indiana’s successful health savings account for low-income Hoosiers to increase Medicaid enrollment while retaining cost certainty for state budget writers.

But those hopes were dashed after the federal Department of Health and Human Services released a frequently asked questions (FAQ) sheet that flatly denied any request to deviate from ObamaCare’s one-size-fits-all, open-ended spending commitment for Medicaid.

With this announcement, the Obama administration has definitively articulated its idea of bipartisan reform.  Republican governors who capitulate and get in line are welcomed with open arms.  Those like Indiana’s Mike Pence can take their policy entrepreneurship somewhere else.

April 1st, 2013 at 2:49 pm
Indiana’s Pence Makes Progress with Innovative Medicaid Expansion

The Indianapolis Star reports that Indiana Republican Governor Mike Pence, a possible 2016 presidential candidate, cleared an important hurdle today when the state’s House Public Health Committee approved a bill to expand Medicaid eligibility without relying on ObamaCare’s open-ended spending incentives.

Pence’s plan would increase Indiana’s Medicaid enrollment by an estimated 400,000, but within the state’s Healthy Indiana initiative begun in 2007.  As a health savings account, Healthy Indiana allots a certain amount of money to qualifying Hoosiers who then shop for doctors and treatment options within their budget.  In effect, it transfers the decision making process for health care away from government bureaucrats to private citizens.  By capping the amount, Healthy Indiana also gives state budget writers more certainty about the cost of Medicaid expansion in future years.

Contrast this with the unlimited spending commitment envisioned by the Medicaid expansion system under ObamaCare, and conservatives will see why Pence’s proposal should be watched closely.  Under ObamaCare, states would pay no cost for expanding their eligibility pool up to 138 percent of the federal poverty line.  But starting in 2017, those that expanded enrollment would pay for 10 percent of the increase.  Though seemingly a small percentage, the costs will run into the billions, with even more likely if the federal government decides to reduce its 90 percent subsidy, as President Barack Obama has already hinted at doing.

The future of health insurance reform looks like it will include some mix of government-regulated exchanges, subsidies, and cost controls.  The question dividing conservatives like Mike Pence and Paul Ryan on one hand from liberals like Obama on the other, is who gets to make the lion’s share of the decisions on how health insurance dollars are spent.  Conservatives value individual choice, while liberals favor centrally planned mandates.

Ironically, if the President wants ObamaCare to be fiscally sustainable, he’ll have to accept that the only way to do it is allowing conservatives like Pence and Ryan to inject into it as much personal freedom as possible.

March 30th, 2013 at 9:42 pm
Obama Should Call an Audible with Late Budget Proposal

With President Barack Obama’s legally required budget proposal arriving two months late (April 10 when it was due February 4), here’s a suggestion to ensure the document is something other than a White House-approved paper weight.

Because of the President’s unprecedented delay, both the Republican House and Democratic Senate have passed budgets, each with only party-line support.  Now that both sides have put their opening bids on the table, it would be wise to make the White House version a kind of third way compromise that includes some elements that both sides like.

One example would be to incorporate Paul Ryan’s idea for putting Medicare plans on a state-based, federally-regulated health insurance exchange.  Then, make the now obvious point that this plan, coupled with ObamaCare’s exchange for non-seniors indicates bipartisan agreement on a major aspect of health insurance reform.  Doing that would help change the focus of the debate on what Republican and Democrats have in common when it comes to moving forward on this issue.

March 30th, 2013 at 6:33 pm
Jindal Raises Sales Tax Estimate Amid Growing Opposition

A new, higher-than-originally-estimated sales tax will be needed to recoup revenue lost if Louisiana legislators adopt Governor Bobby Jindal’s proposal to swap the state’s income taxes on individuals and businesses for an expanded sales tax.

The revision, released by Jindal’s office last Thursday, raised the proposed sales tax rate from 5.88 percent to 6.25 percent, according to reporting by The Times-Picayune of New Orleans.

The timing of the announcement could hardly have been worse.  So far, no business group has mobilized in support of the proposal.  Instead, some of the state’s most influential business associations are opposing the measure because it shifts $500 million in taxable events onto business transactions that are currently exempt.

On the other side of the spectrum, a group of three hundred religious leaders signed a letter to Jindal arguing that the tax swap would amount to a tax increase on the poor.

Even fiscally conservative Republicans are wary because of the administration’s inability to peg a consistent revenue amount if the state moves from income to sales to fund the government.  That skepticism will now grow with Jindal’s higher tax rate, since it looks to some like a tacit admission that previous estimates were overly optimistic.

So far, Jindal appears to be making one of his few missteps in an otherwise very successful run as Louisiana’s governor.

March 28th, 2013 at 12:55 pm
The Liberal Origins of Paul Ryan’s Pro-Market Medicare Reforms

Peter Ferrara, a budget expert at The Heartland Institute, a free market think tank, reminds us where many of Paul Ryan’s ideas on Medicare reform originally came from:

This Medicare reform plan was actually developed by President Clinton’s Medicare Commission, so it had bipartisan support at a time when the Democrat Party had grown ups in influential positions, rather than just adolescent, Marxist, revolutionaries posing in grown up drag.  The legislation providing for these reforms was actually introduced in the Senate by liberal Democrat Sen. Ron Wyden of Oregon.  It has been endorsed by long time liberal academic Alice Rivlin, the Godmother of the CBO, serving as its first director.

Indeed, the plan was developed from an initial proposal in 1995 by two lifelong liberal scholars, Henry Aaron of the Brookings Institution, and former CBO Director Robert Reischauer.  They were the first to propose a premium support system for Medicare in a 1995 article in the journal Health Affairs.  The Reischauer/Aaron concept was later embodied in Medicare Parts C and D in the 2003 Medicare reforms, where they have already worked very effectively.

That’s right – Proposed by liberals, passed by conservatives.

With this in mind, who’s out of the mainstream now?

March 26th, 2013 at 6:33 pm
Update on Jindal’s Sales-for-Income Tax Swap

Two state-based think tanks, Louisiana’s Pelican Institute and Massachusetts’ Beacon Hill Institute, released a study (pdf) highlighting the likely benefits of Louisiana Republican Governor Bobby Jindal’s proposal to scrap the state’s income tax and raise its sales tax.

In a nutshell, the study estimates that Jindal’s plan would increase disposable income by $1.749 billion by 2017. That’s an extra $910 for each Louisiana family.

The question left unaddressed by the study is the one most likely to be asked by critics – What will be the impact on low income citizens whose cost of living (along with everyone else’s) will go up with a greatly expanded sales tax base?

Whereas progressive income taxes take a larger bite out of the paychecks of wealthy citizens, sales taxes take a larger bite from those of the poorer classes.

One way to avoid the charge that a sales-for-income tax swap would amount to a disproportionate tax increase on the poor is to exempt certain items like food and other necessaries from the tax. So far, Jindal’s plan does this.

That, of course, can lead to the same kind of pockmarked tax code that currently infects most states, as well as the IRS.

To my mind, it makes the most sense to argue for a flat tax on income with very few exemptions or deductions. It’s fair, easy to understand, and is the concept most resistant to special interest tampering.

Moreover, when it comes to the national debate over tax reform, it has one huge advantage over a beefed up sales tax: It can be easily replicated at the federal level.

Unless Jindal has become a fan of a national sales tax replacing the national income tax, then maybe his push to swap Louisiana’s income tax for a bigger sales tax is the clearest sign yet he’s not running for President of the United States in 2016.

H/T: The Pelican Post

March 14th, 2013 at 6:02 pm
Jindal’s Louisiana Tax Reform a (Possible) Model for Other States, Feds

A few weeks ago I wrote on the income-for-sale-tax swap some conservative governors are pursuing as an alternative to Washington’s income tax rate debate.

Today, Governor Bobby Jindal of Louisiana, a big proponent of the sales-for-income-tax swap, announced his plan in Baton Rouge.

A press release from Jindal’s office lists the estimated benefits:

The plan will ensure revenue neutrality by:

  • Eliminating~$2.7 Billion in personal income tax and corporate income and franchise tax
  • Eliminating over 200 exemptions, resulting in $114 Million in additional revenue
  • Broadening the state sales tax base and raising the state rate to 5.88%, which will result in ~$2.1 billion in revenue
  • Maintaining vital local tax offsets and business competitiveness incentives
  • Implementing targeted tax offsets, including a change in the cigarette tax rate, and tightening severance tax exemptions

But there are also some possible drawbacks. As I mentioned in my column, moving to a heavier reliance on the sales tax often requires lawmakers to carve out lots of exemptions. The danger is that, over time, a sales tax code could become as special interest driven as the current income tax code with all its byzantine deductions and exemptions.

Without agreeing to the substance of this critique, Jindal’s press release gives a clue as to what might be in store if his plan passes:

To keep the sales tax rate as low as possible, the plan will expand the sales tax base to many services that are already taxed in other states in addition to eliminating over 200 current exemptions. Many of these exemptions are no longer relevant since they were related to the personal income tax and/or corporate income and franchise tax.

Reducing the number of tax exemptions has many benefits, including limiting the state sales tax rate increase required to generate sufficient revenue and greater stability in revenues. The sales tax exemptions retained under the plan will help protect low-income residents and also preserve Louisiana’s business competitiveness. These include:

  • Constitutionally protected sales tax exemptions, including food for home consumption, residential utilities, prescription drugs and fuel.
  • Manufacturing, machinery, and equipment (MM&E), non-residential utilities, farm and agriculture, drilling rigs, vessels greater than 50 tons, tangible personal property for lease or rental, manufacturers’ rebates and trade-in value on new vehicle purchases, and preservation/rehabilitation of historic structures.
  • Exemptions for vendors compensations
  • Exemptions for certain non-profit organizations (religious, military, disabled)
  • Sales tax exemptions on purchases whose cost is already borne by the taxpayer: those made by federal, state and local governments.

Reasonable people can debate the merits of which kind of tax reform is best to make the code simpler and fairer. Personally, I prefer a flat tax on income with few if any exemptions because it leaves the least amount of room for special interest mischief.

That said, Jindal’s plan deserves a hearing. If it passes and works in practice, expect to see Jindal’s tax reform model – if not Jindal himself – on the 2016 presidential campaign trail.

March 12th, 2013 at 3:06 pm
Florida’s ObamaCare Medicaid Expansion on Hold

Republicans in the Florida house and senate have rejected Governor Rick Scott’s plan to expand the state’s Medicaid population.  Under ObamaCare, states are promised three years worth of federal funding to cover the cost increases.  Last week, Scott reversed his earlier opposition and accepted those terms.

The move by Florida’s Republican legislators is a welcome corrective to the knee-buckling capitulation of Scott and other GOP governors.  Borrowing a play out of Rep. Paul Ryan’s budget proposals, State Senator Joe Negron is using his no vote to pivot in a new direction.

“This will be the beginning of a transformation of the entire Medicaid system,” committee Chairman Sen. Joe Negron said. “My goal is that we will get out of the federal Medicaid system as we know it. Now, we can’t do that all at once, but we have an opportunity to begin that process.”

Negron wants the state to create a basic health insurance plan for the expanded Medicaid population and require recipients to pay a sliding scale premium based on their income. He suggested using Florida Healthy Kids, a managed care program that provides health insurance to low-income children, as the vehicle for delivering the new system.

Negron and his colleagues are showing real policy leadership.  Now that Scott’s dash for cash is on hold, it’s time for the former health care executive to rediscover his private sector creativity and help Negron put Florida on a path toward sustainable social safety net spending.

H/T: Tampa Bay Online

February 27th, 2013 at 2:55 pm
Chris Christie to Expand Medicaid

The key passage from Governor Chris Christie’s budget speech yesterday speaks volumes about where the New Jersey Republican stands on principle:

Let me be clear, I am no fan of the Affordable Care Act. I think it is wrong for New Jersey and for America. I fought against it and believe, in the long run, it will not achieve what it promises. However, it is now the law of the land. I will make all my judgments as governor based on what is best for New Jerseyans. That is why I twice vetoed saddling our taxpayers with the untold burden of establishing health exchanges.

But in this instance, expanding Medicaid by 104,000 citizens in a program that already serves 1.4 million, is the smart thing to do for our fiscal and public health. If that ever changes because of adverse actions by the Obama Administration, I will end it as quickly as it started.

Almost all of the same criticisms I leveled at Florida Governor Rick Scott this weekend apply to Christie and his reasoning.

The Governor’s characteristic bluntness, though, merits one further point.

By claiming that the Affordable Care Act (aka ObamaCare) “is wrong for New Jersey and for America,” and that “in the long run, it will not achieve what it promises,” Christie is admitting that he has decided to entangle New Jersey in a fundamentally flawed program that will fail to achieve its goals.  But don’t worry.  In the meantime, New Jerseyans can breathe easy because Christie, like Scott and the other Republican capitulators, will make sure to gobble up as much “free” federal taxpayer money as possible until he decides to pull the plug rather than help cover the costs.

One of the first rules of persuasion is to be coherent.  Christie’s tortured, self-serving logic doesn’t come close.

February 26th, 2013 at 5:03 pm
ObamaCare Burden Tracker

In case you haven’t seen it yet, check out the ObamaCare Burden Tracker (pdf), a summary of 157 rules and regulations that will impose an annual paperwork burden of 127,602,371 hours on the American economy.

The ObamaCare Burden Tracker is a joint project of the House Committees on Ways and Means, Education and Workforce, and Energy and Commerce.

Scrolling through one discovers such things as

  • The new “340B Drug Pricing Program Forms” (#6) will impose an annual paperwork increase of 14,504 hours
  • A new “Medicare Enrollment Application” (#32) will be 70,693 hours
  • Navigating the “Process for Obtaining Waivers of the Annual Limits Requirements of PHS Act Section 2711” (#50) will cost 178,183 hours per year
  • The process to file a “Letter Requesting Waiver of Medicare/Medicaid Enrollment Application Fee; Submission of Fingerprints; Submission of Medicaid Identifying Information; Medicaid Site Visit and Rescreening” (#71) will add a whopping 1,248,082 hours per year
  • Changes to Medicaid eligibility (#77) will mean 21,279,702 new hours
  • The form to get credits for Small Employer Health Insurance Premiums (#131) will be 40,189,456 additional hours

There are many, many more.

Though depressing to read, the report is due to a lot of tedious work by hardworking committee staff members.  Because of it, Americans can see just how much economic productivity is being sacrificed in compliance costs.

February 25th, 2013 at 1:37 pm
White House Tries to Avoid Sequester by Shaming the Public

As usual, Ezra Klein’s Wonkblog has an interesting series of graphs that show the power of the federal government in granular detail.  Today’s installment, courtesy of the White House, provides a state-by-state assessment of how the coming budget sequester will impact a range of federally-funded, state-run programs.

These include popular spending on initiatives such as teachers and schools, work-study jobs, Head Start, job-search assistance, military readiness, law enforcement, child care, vaccines for children, public health, nutrition assistance for seniors, STOP Violence Against Women Program, and clean air and water.

But while the White House is putting out these details to (ostensibly) convince the public that 10 percent across-the-board cuts in discretionary spending will be devastating to popular programs, there’s also a bit of subtle public shaming thrown in as well.  Reading through the graphs it becomes painfully obvious just how much of modern American life is subsidized by federal tax dollars (and in some cases, also supported by state taxes).  Getting confronted with that reality isn’t comfortable; especially when many people have come to rely on this kind of help.

And yet, something has to change.  We simply can’t raise enough taxes to cover the cost of every liberal social experiment, or even to pay for every good idea.  Instead, we as a country need political and other leaders to think carefully about how to modify the social contract we’ve been under since the New Deal so that the generations to come will not be cheated out of their inheritance.

Much like how they react to any reasonable reform ideas to Medicare (see any number of ‘Medi-scare’ tactics), liberals can’t lead on this modification project because they refuse to acknowledge that America has a spending problem in the first place.  It thus falls to conservatives to improve on what we have, preserving what’s good and making it better.

Part of the reason I’m optimistic about the future is that I don’t believe that details about our nation’s financial problems will shame a majority of citizens into zero-sum taxation.  Rather, I think that once people become aware of how overextended is our current welfare state, they will reward politicians who can show how to scale back the public sector so that the private sector can flourish.

February 23rd, 2013 at 7:02 pm
Florida Joins Dark Side on Medicaid Expansion

With all due respect to Newsmax CEO Christopher Ruddy, and as a fan of his website I mean that sincerely, I couldn’t disagree more with his defense of Florida Governor Rick Scott’s decision to accept ObamaCare’s Medicaid expansion.

Like other Republican governors who’ve flipped on the issue, Scott announced last week that even though he remains philosophically opposed to ObamaCare, he would accept at least the law’s Medicaid expansion for the next three years because federal taxpayers – not the state – would pick up the entire price tag.  Like many of the other capitulators, Scott claims that because the Supreme Court ruled ObamaCare constitutional, it doesn’t make financial sense for Florida residents to pay for ObamaCare through fees and penalties while other Medicaid-expanding states reap a windfall.

Ruddy defends Scott’s about-face with two arguments I don’t find compelling.

The first:

Scott has also made it clear that he has not agreed to continue the Medicaid expansion beyond three years, when federal funding will drop to 90 percent, and Florida could opt out at that point.

Let’s get real.  Once a state accepts more federal dollars and grows a politically sensitive program like Medicaid, the trend is to grow, not cut back.

Moreover, Scott’s calculation betrays a canny reading of the political calendar.  He’s up for reelection in November 2014, but will get credit for expanding Medicaid at no cost to state taxpayers in January of that year.  If successful in his bid, Scott can continue to enjoy favorable press until January 2017 when the federal largesse starts receding and Floridians start feeling the cost of all that “free” healthcare.  But by the time that happens Scott will be wrapping up his second term, and handing off that political football to a predecessor.

Which brings us to Ruddy’s other unpersuasive argument:

So governors like Scott and [Arizona’s Jan] Brewer have to put aside their personal views and accept the reality of the situation.

Since when do conviction conservatives want one of their own – as the Tea Party-backed Rick Scott claimed to be in 2010 – to “put aside their personal views” in favor of growing government?

The “reality of the situation” with ObamaCare’s Medicaid expansion is that it’s completely voluntary.  Any governor that accepts its terms is intentionally saddling his or her state’s future taxpayers with a costly new entitlement that will be impossible to scale back through the political process.

After all, if politicians like Scott can’t weather the storm of saying no to entitlement increases when they don’t even exist, how does it pass the laugh test to think he’ll have the political courage to scale back when the feds re-impose reality?

To be fair, Ruddy isn’t alone trying to defend the indefensible.  Charles Krauthammer is singing a similar tune.  But again, with all due respect, it’s just not true that you can claim to be a fiscal conservative and then capitulate on something as basic as a budget-busting expansion of Medicaid.

February 22nd, 2013 at 12:30 pm
More on the Growing Charter School Movement

Nationwide, there are 5,277 charter schools serving 1.6 million K-12 students.

But not all of them are urban minority, low-income students.  Some serve suburban middle class families looking for an alternative to the curriculum on tap in a traditional public school.

For example, Hillsdale College is spearheading a national campaign to create at least one charter school in every state with a classical education curriculum.  Readers of the school’s popular Imprimus publication won’t be surprised to learn that that “These schools will be based on a classical liberal arts model and have a strong civics component that will equip students to understand and defend the principles of the Declaration of Independence and the Constitution,” according to the college’s website.

So far, three parent groups have partnered with Hillsdale to create this distinctive new brand of charter school in Georgia, New Mexico, and Texas.  The Texas version, Founders Classical Academy in Lewisville, began construction in 2012, and expects to start classes this fall.

Hillsdale’s involvement shows that the real genius of the charter school option is that it allows any community of families, regardless of socio-economic status, to opt out of a public school system overburdened by bureaucracy, unions, and questionable curriculum standards.  The charter school option gives local families the choice to spend their tax dollars to, in the words of Founders Classical Academy, “provide a well-rounded education that is distinctively classical, that pursues knowledge, promotes virtue, and prepares students for prosperous lives in a free society.”

What more could a conservative education reformer ask for?

February 19th, 2013 at 12:31 pm
More Local Govt. Corruption in California

An investigative report from the Orange County Register deserves to be read in its entirety, but here’s my executive summary.

Hundreds of schools in California enlisted the services of a bank to underwrite school construction bonds, known on Wall Street as “capital appreciation” bonds.  The key attraction: no payments on principal or interest for 35 years.

Of course, that kind of delay isn’t free.  One school district in Orange County is estimated to owe $13 for every $1 borrowed when the bills come due.  This means that for one $22 million bond issue in 2011, the Placentia-Yorba Linda school district will eventually owe $280 million – 13 times the original amount.

It gets worse.  In 2008, thanks to arguably illegal politicking by the bank underwriter, district voters approved up to $200 million in bond issuances.  But while not all of the total are capital appreciation bonds, those that are could very well bankrupt the district for a generation or more.

The failures on display here are all too familiar.  Public officials opting to mortgage the future to look like a hero in the present saddle taxpayers with huge financial burdens.  Financial whizzes with no ethical scruples abuse the system for big profits.  And money wasted on concrete eye-candy – a football stadium and 600 seat performing arts center – while funding for classroom instruction gets reduced.

While there is no silver lining to the Register piece, it’s worth reading as a reminder of how much American government at all levels needs a deep renewal of ethics, thrift, and a commitment to the common good.

February 15th, 2013 at 12:45 pm
Los Angeles Approves First Conversion of Public to Charter School

The Daily Caller spotlights a landmark decision in the Los Angeles Unified School District this week:

The Los Angeles Board of Education signed off on a parent-led plan to turn a failing public school over to a private charter company this week — the city’s first use of the controversial “parent trigger” law.

The 5-1 vote granted parents in downtown Los Angeles final approval to convert 24th Street Elementary School into a charter school. The new school will be better equipped to handle demographic changes to the area, parents said.

Unsurprisingly, and despite the fact that the parents pushing for the change met for over a year to put together a charter proposal, the United Teachers of Los Angeles, affiliated with the deplorable California Teachers Association, has been opposing the parents’ move by essentially calling the group insane.

In relevant part, the union’s statement declares:

We believe parents do not want a private charger corporation to take over 24th Street Elementary, which is exactly what is happening at Desert Trails Elementary School in Adelanto as a result of the Parent Trigger.

So, parents who have deliberated for over a year about converting their public school into a charter school, used the state’s parent trigger law to do it, have now been approved for the change, and will get a privately run charter school don’t, in fact, want any of this to happen?

It’s hard to know which is more offensive – saying that adults who navigate a rigorous legal process don’t understand the consequences of their actions, or that the union who released this statement is in a superior position to judge what’s best for students in a failing school.

Thanks to the parent trigger, California parents of kids in failing public schools now have a mechanism for saving their child’s education – and their future.

Conservatives looking for ways to grow the movement’s electoral base should pay close attention to this development.  If championed, it could become a key reason why traditionally liberal voters start supporting more conservative candidates.