17 November 2009
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17 November 2009
Today’s Tabbloid PERSONAL NEWS FOR [email protected]
FISCALLY CONSERVATIVE BLOG FEEDS
FISCALLY CONSERVATIVE BLOG FEEDS
Taking Over Everything (2) [Cato at Liberty]
ATR Endorses “Health Savings Account Expansion Act of 2009” [Americans for Tax Reform]
NOV 16, 2009 07:48P.M. “My critics say that I’m taking over every sector of the economy,” President Obama complained to George Stephanopoulos back in September. And I responded:
NOV 16, 2009 05:13P.M.
Not every sector. Just
ATR sent the following letter to Congressman Jeff Flake (R-Ariz.) today: On behalf of Americans for Tax Reform, I write to congratulate you for
• health care
sponsoring H.R. 3971,...
• energy • local schools
FISCALLY CONSERVATIVE BLOG FEEDS
A Handy PATRIOT Act Cheat Sheet [Cato at Liberty]
• banks • insurance companies
NOV 16, 2009 04:52P.M. • automobile companies While there are a slew of USA PATRIOT Act reform bills buzzing about Capitol Hill, the focus in Congress is now on two chief contenders, reported out by the House and Senate judiciary committees respectively. The very very short version is that the Senate version renews expiring PATRIOT powers with very few modifications, and that the House version includes an array of moderately more robust civil liberties safeguards. As Kevin Bankston of the Electronic Frontier Foundation has argued cogently, these differences are really far less important than the need to reform the FISA Amendments Act, which vastly expanded the surveillance powers of the National Security Agency, in effect permitting the Bush administration’s program of warrantless wiretapping to proceed with some cosmetic trappings of oversight. Still, the House bill does go some ways toward restoring the quaint notion that government should pry in to the private records of its citizens only when some evidence exists to provide grounds for individualized suspicion.
• compensation at financial firms • newspapers • the internet And now check out the lead story in Sunday’s Washington Post: Federal Oversight of Subways Proposed The Obama administration will propose that the federal government take over safety regulation of the nation’s subway and light-rail systems, responding to what it says is haphazard and ineffective oversight by state agencies. Not everything. But more and more. So much that even the growing
The Obama administration, alas, has decided to back the Senate’s bill, though the Justice Department also expressed “concerns” about the handful of actually-substantive checks on government spying power, and made clear that it intends to continue “working with the Committee” to gut those before the bill reaches the floor. For those with a taste for the gory details, Wired points to CDT’s handy dandy cheat sheet comparing
opposition can’t keep up with it all.
the main provisions of the two bills.
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Today’s Tabbloid PERSONAL NEWS FOR [email protected]
17 November 2009
That leads to a very familiar, but nonetheless dispiriting, conclusion: in education, a blizzard of rhetoric is all it takes to blind people to reality. FISCALLY CONSERVATIVE BLOG FEEDS
Minnesota Budget Shouldn’t be Based on Money Politicians Hope to Have [Americans for Tax Reform]
FISCALLY CONSERVATIVE BLOG FEEDS
House Key Vote Alert - ‘Doc Fix’ [The Club for Growth] NOV 16, 2009 04:39P.M.
NOV 16, 2009 04:45P.M.
KEY VOTE ALERT
Year after year states build their budgets around what they expect to raise in tax revenue for the upcoming fiscal year. This means that states
“NO” to “Doc Fix” (H.R. 3961)
budget revenue for programs and services with money they...
NOV 16, 2009 04:43P.M.
The Club for Growth urges all members of the U.S. House to vote “NO” on the so-called Medicare Physician Payment Reform Act of 2009, otherwise known as the “Doc Fix” bill (H.R. 3961). A vote on this proposal is expected later this week. This key vote will be part of our 2009 Congressional Scorecard.
When you get to the top of a mountain, what do you find? Other than maybe a mountain goat, or the frozen remains of an ill-fated previous climber, snow, that’s what. That’s why it’s almost appropriate that the Obama administration’s Race to the The Top Fund, as I have written before and write again in this new op-ed, is essentially a snow job. And it seems to be a particularly blinding one.
This bill is not offset with any spending cuts so the overall tab will recklessly add over $200 billion over ten years to the national debt. This is also a deceptive attempt to hide the true cost of health care reform.
To qualify for Fund dollars, states have to make hardly any meaningful changes to their education systems. For the most part they just have to submit plans for how they could conceivably do good stuff. Moreover, the same “stimulus” that furnished the $4.35 billion for Race to The Top supplied roughly 20 times that amount to protect the abysmal, obese education status quo from recessionary pressures. Nonetheless, many conservatives, including former House Speaker Newt Gingrich, are going out of their way to lionize Obama & co. for their reform efforts.
Reasonable people can argue about the merits of a “doc fix”, but fiscal prudence demands that it not add one penny to the national debt. This bill needs to have a full offset of spending cuts to meet that requirement. Also, it’s clear that Senate leaders are stripping this bill out of comprehensive health care reform legislation in order to avoid the task of selling an expensive proposal to the public that breaks the President’s revenue neutral pledge. When it comes to overhauling one-sixth of the national economy, the American people are entitled to honesty and transparency from their elected leaders in
FISCALLY CONSERVATIVE BLOG FEEDS
Fed Ed Snow Job [Cato at Liberty]
Why the cross-spectrum adulation? One problem is certainly that some conservatives have given up on real reform — universal school choice and getting the feds out of education — in favor of being seen as “doing something” from Washington. Probably more important, though, is that Race to the Top is constantly being festooned in brash, combative rhetoric about pushing what are actually relatively minor — but still disliked by teacher union — improvements such as linking educator pay to student performance and increasing charter schools. (For a taste of the hyperbole, check out Secretary of Education Arne Duncan’s opening commentary from Sunday’s Meet the Press.) That Race to the Top falls far short of actually doing even these very limited things seems not to matter.
Washington.
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17 November 2009
relationship. Access to housing, jobs, new goods, and the possibility of minor improvements in life, all depend on a well documented support of the revolution through attendance of mass meetings and membership in the communist party, for example.
Cuban Blogger Yoani Sanchez Keeps Speaking Truth to Power [Cato at Liberty]
Or through personal relationships with those in power. Sanchez describes how young women long ago began prostituting themselves to high ministry or military officials in exchange for non-monetary goods or privileges. Such “courtesans of socialism” later turned to traditional prostitution with the arrival of currency convertibility in Cuba. Sanchez also optimistically describes the role that technology, especially the internet, is playing in creating spaces of liberty. In a country where people increasingly feel the regime’s days are numbered, such exercises
NOV 16, 2009 02:36P.M.
of personal freedom can be powerful.
FISCALLY CONSERVATIVE BLOG FEEDS
Even Obama’s Make-Believe Jobs Are Not Real [Cato at Liberty] NOV 16, 2009 01:38P.M. It’s the 490th anniversary of Havana today and the Cuban government has arranged for celebratory activities. Ordinary residents of Havana and all Cubans who cherish their civil and human rights have less to celebrate, however, as Cuban blogger Yoani Sanchez regularly reminds us. Sanchez has become a major irritant of the regime because of her penetrating posts about the absurdities and injustices of everyday life in communist Cuba. You can see her blog in Spanish here, and in English here.
The White House recently began claiming that the “Recovery Act” had “created or saved” 640,000-plus jobs. This turns out to have been a political mistake, in part because even sympathetic reporters understand that the “jobs saved” measure allows for creative accounting. But the White House also erred by providing (supposed) details about the jobs that were created. This made it very easy for reporters and other curious people to do a bit of fact checking, which has generated a spate of stories showing that the White House’s numbers are wrong, even using makebelieve methodology. The Washington Examiner has put together a very useful interactive map which links to many of the news reports
Just over a week ago, in an incident that was widely reported in the international press and that reveals the threat to the Cuban regime of the growing Cuban blogger movement, Sanchez was assaulted in Havana by plain-clothed government agents. Though she was forcefully beaten, she and her friends managed to fight back and get away. More than that, they took pictures of their assailants and of the incident for posting on the blog, prompting the government thugs to leave the scene. One photo of an agent features the caption “She is covering her face…Perhaps afraid of the future.” Another photo features Sanchez pursuing her assailants with the caption: “They have watched us for decades. Now we are watching them.” Very smart.
debunking the Administration’s fraudulent numbers.
As it happens, last week we posted a beautifully written paper by Sanchez (in Spanish) on Cato’s Spanish-language web page, www.elcato.org. (The paper just won a prize in an essay contest in Mexico organized by TV Azteca at which my Cato colleague Juan Carlos Hidalgo was a judge.) Her essay, “Liberty as a Form of Payment,” describes the fraudulent deal that Castro promised when he came to power. In exchange for liberty, Cubans would be better off culturally, economically, and in other ways. Sanchez describes the reality of social control under communist Cuba in which the real exchanges occur as a consequence of the power
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Today’s Tabbloid PERSONAL NEWS FOR [email protected]
17 November 2009
FISCALLY CONSERVATIVE BLOG FEEDS
FISCALLY CONSERVATIVE BLOG FEEDS
The New Threats to Free Speech [Cato at Liberty]
Monday Links [Cato at Liberty] NOV 16, 2009 12:17P.M.
NOV 16, 2009 12:26P.M.
• Report: New threats to free speech.
In a new Policy Analysis, Cato Research Fellow Jason Kuznicki examines the ongoing threats to free speech both at home and around the world, from hate-speech laws in the United Kingdom and Canada and university speech codes in the United States, to the Cairo Declaration on Human Rights in Islam:
• The politics behind the health care overhaul. • Mass corruption in Afghanistan. Malou Innocent: “Washington has already surged into Afghanistan once this year. The United States should not spend more American blood and more of its everdiminishing financial resources to prop up Karzai’s ineffectual regime.”
The result is not more happiness, but a race to the bottom, in which aggrieved groups compete endlessly with one another for a slice of government power. Philosopher Robert Nozick once observed that utilitarianism is hard-pressed to banish what he termed utility monsters—that is, individuals who take inordinate satisfaction from acts that displease others. Arguing about who hurt whose feelings worse, and about who needs more soothing than whom, seems designed to discover—or create—utility monsters. We must not allow this to happen.
• A government takeover of health care is not pro-choice — for anyone: “Whatever your views on abortion, the fight over abortion in the Obama health plan illustrates perfectly why government should stay out of health care. When the government subsidizes health care, anything you do with that money becomes the voters’ business. And rather than allow for choice between different ways of doing things, the government typically imposes the preferences of the majority — or sometimes, a vocal minority — on everybody.”
Instead, liberal governments have traditionally relied on a particular bargain, in which freedom of expression is maintained for all, and in which emotional satisfaction is a private pursuit, not a public guarantee. This bargain can extend equally to all people, and it forms the basis for an enduring and diverse society, one in which differences may be aired without fear of reprisal. Although world cultures increasingly mix with one another, and although our powers of expression are greater than ever before, these are not sound reasons to abandon the liberal bargain. Restrictions on free expression do not make societies happier or more tolerant, but instead make them more fractious and censorious.
• Podcast: “A Proposed Beat Down for Banks“
FISCALLY CONSERVATIVE BLOG FEEDS
ATR and CFA to House: Pass the TARP Accountability and Disclosure Act [Americans for Tax Reform] NOV 16, 2009 11:49A.M.
Read the whole thing. As a possible extension of the TARP program looms, the House is set to vote on a measure that will bring more transparency and accountability into the program this week. An amended version of H....
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Today’s Tabbloid PERSONAL NEWS FOR [email protected]
17 November 2009
FISCALLY CONSERVATIVE BLOG FEEDS
FISCALLY CONSERVATIVE BLOG FEEDS
Dollar Crisis [Cato at Liberty]
Monday’s Daily News [The Club for Growth]
NOV 16, 2009 11:31A.M. Over the weekend, Liu Mingkang, a senior Chinese official, blasted the economic policies of the Obama Administration. He identified low interest rates in the U.S. as the cause of “massive speculation” that was inflating asset bubbles around the world. The U.S. dollar is being used in what is known as a carry trade and is borrowed cheaply to finance the purchase of real estate in Asian cities like Hong Kong and Singapore. The easy money policies of the Fed are also fueling a boom in commodity prices.
NOV 16, 2009 11:20A.M. The New York Times cuts union jobs and replaces them with nonunionized labor. A government agency says House health care bill will increase costs. A neighborhood in Brooklyn with $600,000 apartments is declared ‘blighted.’
The ordinary American, if not the political class, recognizes that neither the Fed’s monetary actions nor the trillions in spending have helped them. Unemployment is in double digits. Former senior Bush economic adviser Larry Lindsey is reported to have estimated that Americans’ net worth has dropped $13 trillion since the beginning of the recession in December 2007. Americans suffer while speculators profit.
WSJ Editorial: “How to return $200 billion to the Treasury.” Economist Greg Mankiw discusses supply, demand, and health care. For the record, Deroy Murdock reminds us that Dede Scozzafava is no GOP moderate.
We are on the cusp of a dollar crisis. President Jimmy Carter faced a similar crisis in his presidency. Carter ousted his own choice for Chairman of the Fed and appointed Paul Volcker to that position. Volcker recognized that the dollar crisis needed to be ended and instituted painful but necessary sound money policies. President Reagan re-appointed Volcker and together they restored American prosperity. Volcker advises President Obama and can explain to the president why
General Motors is going to accelerate the repayment of their bailout money.
he must act now.
Virginia’s Department of Transportation has paid over $60,000 in court costs and appraiser fees to avoid paying $30,000 in an eminent domain case. It has been expensive for VDOT because their own lawyers have an overload of eminent domain cases.
FISCALLY CONSERVATIVE BLOG FEEDS
“The results of a new survey suggest that one-fifth of UK-based entrepreneurs earning more than GBP150,000 are planning to flee Britain in search of countries with more favorable tax rates”
Centers for Medicare and Medicaid Services Report On Obamacare [Americans for Tax Reform]
IBD Editorial: America’s corporate tax to grind.
NOV 16, 2009 11:25A.M. Last Friday, the the non-partisan and independent Centers for Medicare and Medicaid Services, the agency in charge of running Medicare and Medicaid, issued a report analyzing the effect of Obamacare i...
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Today’s Tabbloid PERSONAL NEWS FOR [email protected]
17 November 2009
FISCALLY CONSERVATIVE BLOG FEEDS The aforementioned panel will debate.
The High Cost of European Union Bureaucracy [Cato at Liberty]
“HEALTHCARE WILL PASS THE SENATE” Sen. Judd Gregg (R-NH) will join us with his perspective. BULL/BEAR DEBATE
NOV 16, 2009 11:13A.M. *(bull) Jack Ablin, Harris Private Bank Chief Investment Officer *(bear) Joe Battipaglia, Stifel Nicolaus Market Strategist
The clever folks at the Taxpayers Alliance in the United Kingdom have a new video documenting some of the wasteful European Union programs that are imposing a heavy burden on average people.
Please join us. The Kudlow Report. 7pm ET. CNBC.
FISCALLY CONSERVATIVE BLOG FEEDS
FISCALLY CONSERVATIVE BLOG FEEDS
On CNBC’s Kudlow Report [Larry Kudlow’s Money Politic$]
How Is Sotomayor Doing? [Cato at Liberty]
NOV 16, 2009 11:03A.M.
I was one of those who opposed the nomination of Sonia Sotomayor to the Supreme Court, mainly because the pick was based on race and gender rather than merit and she was disingenuous and obfuscatory at her confirmation hearings. Well, the Court still hasn’t decided any cases argued with Justice Sotomayor on the bench — and the first term isn’t always indicative of the kind of jurist a new justice will be – but we do have some early statistics about her performance.
NOV 16, 2009 10:47A.M.
It turns out that, unlike her next most junior colleague, Justice Alito — who hung back early in his tenure while learning the rhythms of the Court – Justice Sotomayor has not been a shrinking violet in her questioning of advocates. Indeed, according to a National Law Journal tally, during the 13 November arguments that just concluded, she asked 146 questions (or 11.2 per case), which is even ahead of where Chief Justice Roberts was at this point in his career. And, because Sotomayor speaks more often than her more reserved predecessor, Justice Souter, she has made a “hot” bench even hotter.
This evening at 7pm ET: BEN BERNANKE’S SPEECH: An eye on the Fed, dollar & gold Panel: *Steve Liesman, CNBC senior economics reporter *Peter Morici, University of Maryland Robert H. Smith School of Business Professor; U.S. International Trade Commission Fmr. Chief Economist *Andy Busch, BMO Capital Markets; CNBC Contributor *David Goldman, Associate Editor First Things Blog
By another indicator, however, Sotomayor ranks at the bottom of the Supreme Court table: Apparently her questioning has not yet generated a single laugh (as measured by such indications in the argument transcript). Not surprisingly, Justice Scalia leads in that department — as he long has, both in absolute and per-question terms – with the Chief being the only other justice in double figures. Joining Sotomayor with a goose-egg so far this year are Justices Ginsburg and Thomas (who hasn’t asked a question since 2006). If you’re curious about last year’s final standings, see here.
OBAMA IN CHINA The China challenge & currency buzz CNBC chief Washington correspondent John Harwood will join us from Beijing.
For what it’s worth, all this accords with the sense I’ve gotten from the handful of times I’ve been to the Court for oral argument so far this term. To my mind, Sotomayor is still acting as a Court of Appeals judge — or maybe even a district judge – asking simpler questions about the factual record or procedural history rather than the broader issues the
CHINA CURRENCY DEBATE Yuan a strong dollar?
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Today’s Tabbloid PERSONAL NEWS FOR [email protected]
Court tends to grapple with. And therefore I’ll go out on a counterintuitive limb here to predict that, as Sotomayor settles into her new role, her questioning will become less frequent but more
17 November 2009
The health-care reform proposals now before Congress could further strain state budgets because they would expand Medicaid, Genest said.
substantive. Genest said Congress should overhaul Medicaid, now funded jointly by state and federal governments but run by the states. The federal government should cover more of the costs, give states more flexibility or even make a drastic switch and let federal officials take over Medicaid completely, he said.
FISCALLY CONSERVATIVE BLOG FEEDS
Federal Assumption of Medicaid Costs [Cato at Liberty]
“If you want to imagine a crisis, as a thought experiment, imagine all 50 states writing a letter to the federal government saying, ‘We’re no longer providing Medicaid.’ That would get Congress’ attention. And that’s about the only real leverage we have,” Genest said.
NOV 16, 2009 10:43A.M. From the standpoint of Americans who prefer less government, one of the worst developments of the 20th century was the federal subsidization of state and local spending. The result has been bigger government at all levels. Medicaid represents the largest portion of federal money to the states. The states administer their own Medicaid programs, but the federal government picks up 50 to 83 percent of the tab depending on a state’s income. The estimated price tag of the federal share for fiscal year 2009 is $260 billion.
Current health care legislation in Congress threatens to increase state Medicaid spending. In the House passed bill, the federal government would pick up 100 percent of Medicaid’s expansion until 2015 when it would drop to 91 percent. However, the future is unpredictable and it’s not hard to imagine a future Congress keeping it at 100 percent federal funding.
One result of the federal government paying for half or more is that it encourages the states to expand enrollment and benefits. It also makes it politically difficult to cut state Medicaid spending because of the accompanying loss of federal dollars.
According to the Congressional Research Service, the House bill also contains a provision that could be intended to create a justification for greater federal assumption of state Medicaid spending: H.R. 3962 would require GAO to study federal matching payments made to state Medicaid programs to make recommendations on the FMAP formula to Congress. By February 15, 2011, GAO would be required to submit a report based on this study assessing the effect on the federal government, states, providers, and beneficiaries of making the following changes to the FMAP formula: (1) removing the 50% floor or 83% ceiling, or both and (2) revising the current FMAP formula to better reflect state fiscal capacity, state efforts to finance health and long-term care services, and to better adjust for national or regional economic downturns.
A 2007 analysis on the exorbitant future costs of Medicaid by Jagadeesh Gokhale illustrates how the program’s price tag has skyrocketed since its creation in 1965 (see chart here). Over the decades, the states expanded their programs whenever the economy was growing and the tax revenues were flowing. When the economy went into recession and the revenue dried up, the states generally didn’t scale-back benefits and sometimes they asked for bailouts from the federal government. The 2009 stimulus package provided an estimated $87 billion in federal Medicaid money for the states. If the economy remains stagnant over the next few years and state tax revenues fail to rebound, further pressure will mount on the federal government to continue bailing out state Medicaid programs. The nightmare scenario would be for the federal government to assume the full costs of Medicaid under state pressure.
See this essay on the need for a return to fiscal federalism. Update: The Washington Post reports this morning that the House health care reform bill contains an additional $23.5 billion Medicaid bailout for the states. The provision would extend by an additional six months (through 2011) the stimulus legislation’s “temporary” increase in
California Gov. Arnold Schwarzenegger’s budget director, Michael Genest, recently raised the idea:
the federal government’s share of total Medicaid spending.
Genest, who is retiring at the end of the year, warned that California’s budget problems will persist even after the state works its way through this recession. He singled out MediCal, the state’s Medicaid health-care program for the poor, as unaffordable for the state. If the program’s costs continue to climb 8 percent a year, the state will have little money left for anything other than schools and debt service by 2040, he said.
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The Remnants of “War on Terror” [Cato at Liberty“War on Terror”] NOV 16, 2009 10:37A.M. Former New York City mayor Rudy Giuliani appeared on Fox News Sunday this weekend to argue against the Obama administration’s plan to try some alleged terrorists in New York courts. He did not acquit himself well. Giuliani argued, for example, that criminal defendants aren’t tried “at the scene of the crime.” Criminal defendants are almost always tried in the jurisdictions where their crimes took place (not at the actual crime scene, of course). Giuliani’s insistence on misstating basic criminal procedure showed that he was twisting to score points against the administration. This is inappropriate political use of terrorism issues. But Chris Wallace roasted Giuliani—with quotes from Rudy Giuliani. Of prosecuting the 1993 World Trade Center bombers, Giuliani said: “[Y]ou put terrorism on one side, you put our legal system on the other, and our legal system comes out ahead.” Giuliani said that the trial of Zacharias Moussaoui shows “that we can give people a fair trial, that we are exactly what we say we are. We are a nation of law.” As he did during his failed presidential campaign, Giuliani appears caught in a terror-warrior time warp. He criticized the Obama administration for eschewing the regrettable phrase “war on terror,” and he betrayed no awareness of what has dawned since 9/11 on the rest of the country: Terrorism seeks overreaction on the part of victim states. Cool, phlegmatic prosecution of terrorists deprives them of rhetorical victories that empower them by drawing others to their side.
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17 November 2009
Today’s Tabbloid PERSONAL NEWS FOR [email protected]
FISCALLY CONSERVATIVE BLOG FEEDS
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Taking Over Everything (2) [Cato at Liberty]
ATR Endorses “Health Savings Account Expansion Act of 2009” [Americans for Tax Reform]
NOV 16, 2009 07:48P.M. “My critics say that I’m taking over every sector of the economy,” President Obama complained to George Stephanopoulos back in September. And I responded:
NOV 16, 2009 05:13P.M.
Not every sector. Just
ATR sent the following letter to Congressman Jeff Flake (R-Ariz.) today: On behalf of Americans for Tax Reform, I write to congratulate you for
• health care
sponsoring H.R. 3971,...
• energy • local schools
FISCALLY CONSERVATIVE BLOG FEEDS
A Handy PATRIOT Act Cheat Sheet [Cato at Liberty]
• banks • insurance companies
NOV 16, 2009 04:52P.M. • automobile companies While there are a slew of USA PATRIOT Act reform bills buzzing about Capitol Hill, the focus in Congress is now on two chief contenders, reported out by the House and Senate judiciary committees respectively. The very very short version is that the Senate version renews expiring PATRIOT powers with very few modifications, and that the House version includes an array of moderately more robust civil liberties safeguards. As Kevin Bankston of the Electronic Frontier Foundation has argued cogently, these differences are really far less important than the need to reform the FISA Amendments Act, which vastly expanded the surveillance powers of the National Security Agency, in effect permitting the Bush administration’s program of warrantless wiretapping to proceed with some cosmetic trappings of oversight. Still, the House bill does go some ways toward restoring the quaint notion that government should pry in to the private records of its citizens only when some evidence exists to provide grounds for individualized suspicion.
• compensation at financial firms • newspapers • the internet And now check out the lead story in Sunday’s Washington Post: Federal Oversight of Subways Proposed The Obama administration will propose that the federal government take over safety regulation of the nation’s subway and light-rail systems, responding to what it says is haphazard and ineffective oversight by state agencies. Not everything. But more and more. So much that even the growing
The Obama administration, alas, has decided to back the Senate’s bill, though the Justice Department also expressed “concerns” about the handful of actually-substantive checks on government spying power, and made clear that it intends to continue “working with the Committee” to gut those before the bill reaches the floor. For those with a taste for the gory details, Wired points to CDT’s handy dandy cheat sheet comparing
opposition can’t keep up with it all.
the main provisions of the two bills.
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Today’s Tabbloid PERSONAL NEWS FOR [email protected]
17 November 2009
That leads to a very familiar, but nonetheless dispiriting, conclusion: in education, a blizzard of rhetoric is all it takes to blind people to reality. FISCALLY CONSERVATIVE BLOG FEEDS
Minnesota Budget Shouldn’t be Based on Money Politicians Hope to Have [Americans for Tax Reform]
FISCALLY CONSERVATIVE BLOG FEEDS
House Key Vote Alert - ‘Doc Fix’ [The Club for Growth] NOV 16, 2009 04:39P.M.
NOV 16, 2009 04:45P.M.
KEY VOTE ALERT
Year after year states build their budgets around what they expect to raise in tax revenue for the upcoming fiscal year. This means that states
“NO” to “Doc Fix” (H.R. 3961)
budget revenue for programs and services with money they...
NOV 16, 2009 04:43P.M.
The Club for Growth urges all members of the U.S. House to vote “NO” on the so-called Medicare Physician Payment Reform Act of 2009, otherwise known as the “Doc Fix” bill (H.R. 3961). A vote on this proposal is expected later this week. This key vote will be part of our 2009 Congressional Scorecard.
When you get to the top of a mountain, what do you find? Other than maybe a mountain goat, or the frozen remains of an ill-fated previous climber, snow, that’s what. That’s why it’s almost appropriate that the Obama administration’s Race to the The Top Fund, as I have written before and write again in this new op-ed, is essentially a snow job. And it seems to be a particularly blinding one.
This bill is not offset with any spending cuts so the overall tab will recklessly add over $200 billion over ten years to the national debt. This is also a deceptive attempt to hide the true cost of health care reform.
To qualify for Fund dollars, states have to make hardly any meaningful changes to their education systems. For the most part they just have to submit plans for how they could conceivably do good stuff. Moreover, the same “stimulus” that furnished the $4.35 billion for Race to The Top supplied roughly 20 times that amount to protect the abysmal, obese education status quo from recessionary pressures. Nonetheless, many conservatives, including former House Speaker Newt Gingrich, are going out of their way to lionize Obama & co. for their reform efforts.
Reasonable people can argue about the merits of a “doc fix”, but fiscal prudence demands that it not add one penny to the national debt. This bill needs to have a full offset of spending cuts to meet that requirement. Also, it’s clear that Senate leaders are stripping this bill out of comprehensive health care reform legislation in order to avoid the task of selling an expensive proposal to the public that breaks the President’s revenue neutral pledge. When it comes to overhauling one-sixth of the national economy, the American people are entitled to honesty and transparency from their elected leaders in
FISCALLY CONSERVATIVE BLOG FEEDS
Fed Ed Snow Job [Cato at Liberty]
Why the cross-spectrum adulation? One problem is certainly that some conservatives have given up on real reform — universal school choice and getting the feds out of education — in favor of being seen as “doing something” from Washington. Probably more important, though, is that Race to the Top is constantly being festooned in brash, combative rhetoric about pushing what are actually relatively minor — but still disliked by teacher union — improvements such as linking educator pay to student performance and increasing charter schools. (For a taste of the hyperbole, check out Secretary of Education Arne Duncan’s opening commentary from Sunday’s Meet the Press.) That Race to the Top falls far short of actually doing even these very limited things seems not to matter.
Washington.
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Today’s Tabbloid PERSONAL NEWS FOR [email protected]
FISCALLY CONSERVATIVE BLOG FEEDS
17 November 2009
relationship. Access to housing, jobs, new goods, and the possibility of minor improvements in life, all depend on a well documented support of the revolution through attendance of mass meetings and membership in the communist party, for example.
Cuban Blogger Yoani Sanchez Keeps Speaking Truth to Power [Cato at Liberty]
Or through personal relationships with those in power. Sanchez describes how young women long ago began prostituting themselves to high ministry or military officials in exchange for non-monetary goods or privileges. Such “courtesans of socialism” later turned to traditional prostitution with the arrival of currency convertibility in Cuba. Sanchez also optimistically describes the role that technology, especially the internet, is playing in creating spaces of liberty. In a country where people increasingly feel the regime’s days are numbered, such exercises
NOV 16, 2009 02:36P.M.
of personal freedom can be powerful.
FISCALLY CONSERVATIVE BLOG FEEDS
Even Obama’s Make-Believe Jobs Are Not Real [Cato at Liberty] NOV 16, 2009 01:38P.M. It’s the 490th anniversary of Havana today and the Cuban government has arranged for celebratory activities. Ordinary residents of Havana and all Cubans who cherish their civil and human rights have less to celebrate, however, as Cuban blogger Yoani Sanchez regularly reminds us. Sanchez has become a major irritant of the regime because of her penetrating posts about the absurdities and injustices of everyday life in communist Cuba. You can see her blog in Spanish here, and in English here.
The White House recently began claiming that the “Recovery Act” had “created or saved” 640,000-plus jobs. This turns out to have been a political mistake, in part because even sympathetic reporters understand that the “jobs saved” measure allows for creative accounting. But the White House also erred by providing (supposed) details about the jobs that were created. This made it very easy for reporters and other curious people to do a bit of fact checking, which has generated a spate of stories showing that the White House’s numbers are wrong, even using makebelieve methodology. The Washington Examiner has put together a very useful interactive map which links to many of the news reports
Just over a week ago, in an incident that was widely reported in the international press and that reveals the threat to the Cuban regime of the growing Cuban blogger movement, Sanchez was assaulted in Havana by plain-clothed government agents. Though she was forcefully beaten, she and her friends managed to fight back and get away. More than that, they took pictures of their assailants and of the incident for posting on the blog, prompting the government thugs to leave the scene. One photo of an agent features the caption “She is covering her face…Perhaps afraid of the future.” Another photo features Sanchez pursuing her assailants with the caption: “They have watched us for decades. Now we are watching them.” Very smart.
debunking the Administration’s fraudulent numbers.
As it happens, last week we posted a beautifully written paper by Sanchez (in Spanish) on Cato’s Spanish-language web page, www.elcato.org. (The paper just won a prize in an essay contest in Mexico organized by TV Azteca at which my Cato colleague Juan Carlos Hidalgo was a judge.) Her essay, “Liberty as a Form of Payment,” describes the fraudulent deal that Castro promised when he came to power. In exchange for liberty, Cubans would be better off culturally, economically, and in other ways. Sanchez describes the reality of social control under communist Cuba in which the real exchanges occur as a consequence of the power
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17 November 2009
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The New Threats to Free Speech [Cato at Liberty]
Monday Links [Cato at Liberty] NOV 16, 2009 12:17P.M.
NOV 16, 2009 12:26P.M.
• Report: New threats to free speech.
In a new Policy Analysis, Cato Research Fellow Jason Kuznicki examines the ongoing threats to free speech both at home and around the world, from hate-speech laws in the United Kingdom and Canada and university speech codes in the United States, to the Cairo Declaration on Human Rights in Islam:
• The politics behind the health care overhaul. • Mass corruption in Afghanistan. Malou Innocent: “Washington has already surged into Afghanistan once this year. The United States should not spend more American blood and more of its everdiminishing financial resources to prop up Karzai’s ineffectual regime.”
The result is not more happiness, but a race to the bottom, in which aggrieved groups compete endlessly with one another for a slice of government power. Philosopher Robert Nozick once observed that utilitarianism is hard-pressed to banish what he termed utility monsters—that is, individuals who take inordinate satisfaction from acts that displease others. Arguing about who hurt whose feelings worse, and about who needs more soothing than whom, seems designed to discover—or create—utility monsters. We must not allow this to happen.
• A government takeover of health care is not pro-choice — for anyone: “Whatever your views on abortion, the fight over abortion in the Obama health plan illustrates perfectly why government should stay out of health care. When the government subsidizes health care, anything you do with that money becomes the voters’ business. And rather than allow for choice between different ways of doing things, the government typically imposes the preferences of the majority — or sometimes, a vocal minority — on everybody.”
Instead, liberal governments have traditionally relied on a particular bargain, in which freedom of expression is maintained for all, and in which emotional satisfaction is a private pursuit, not a public guarantee. This bargain can extend equally to all people, and it forms the basis for an enduring and diverse society, one in which differences may be aired without fear of reprisal. Although world cultures increasingly mix with one another, and although our powers of expression are greater than ever before, these are not sound reasons to abandon the liberal bargain. Restrictions on free expression do not make societies happier or more tolerant, but instead make them more fractious and censorious.
• Podcast: “A Proposed Beat Down for Banks“
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ATR and CFA to House: Pass the TARP Accountability and Disclosure Act [Americans for Tax Reform] NOV 16, 2009 11:49A.M.
Read the whole thing. As a possible extension of the TARP program looms, the House is set to vote on a measure that will bring more transparency and accountability into the program this week. An amended version of H....
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17 November 2009
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Dollar Crisis [Cato at Liberty]
Monday’s Daily News [The Club for Growth]
NOV 16, 2009 11:31A.M. Over the weekend, Liu Mingkang, a senior Chinese official, blasted the economic policies of the Obama Administration. He identified low interest rates in the U.S. as the cause of “massive speculation” that was inflating asset bubbles around the world. The U.S. dollar is being used in what is known as a carry trade and is borrowed cheaply to finance the purchase of real estate in Asian cities like Hong Kong and Singapore. The easy money policies of the Fed are also fueling a boom in commodity prices.
NOV 16, 2009 11:20A.M. The New York Times cuts union jobs and replaces them with nonunionized labor. A government agency says House health care bill will increase costs. A neighborhood in Brooklyn with $600,000 apartments is declared ‘blighted.’
The ordinary American, if not the political class, recognizes that neither the Fed’s monetary actions nor the trillions in spending have helped them. Unemployment is in double digits. Former senior Bush economic adviser Larry Lindsey is reported to have estimated that Americans’ net worth has dropped $13 trillion since the beginning of the recession in December 2007. Americans suffer while speculators profit.
WSJ Editorial: “How to return $200 billion to the Treasury.” Economist Greg Mankiw discusses supply, demand, and health care. For the record, Deroy Murdock reminds us that Dede Scozzafava is no GOP moderate.
We are on the cusp of a dollar crisis. President Jimmy Carter faced a similar crisis in his presidency. Carter ousted his own choice for Chairman of the Fed and appointed Paul Volcker to that position. Volcker recognized that the dollar crisis needed to be ended and instituted painful but necessary sound money policies. President Reagan re-appointed Volcker and together they restored American prosperity. Volcker advises President Obama and can explain to the president why
General Motors is going to accelerate the repayment of their bailout money.
he must act now.
Virginia’s Department of Transportation has paid over $60,000 in court costs and appraiser fees to avoid paying $30,000 in an eminent domain case. It has been expensive for VDOT because their own lawyers have an overload of eminent domain cases.
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“The results of a new survey suggest that one-fifth of UK-based entrepreneurs earning more than GBP150,000 are planning to flee Britain in search of countries with more favorable tax rates”
Centers for Medicare and Medicaid Services Report On Obamacare [Americans for Tax Reform]
IBD Editorial: America’s corporate tax to grind.
NOV 16, 2009 11:25A.M. Last Friday, the the non-partisan and independent Centers for Medicare and Medicaid Services, the agency in charge of running Medicare and Medicaid, issued a report analyzing the effect of Obamacare i...
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17 November 2009
FISCALLY CONSERVATIVE BLOG FEEDS The aforementioned panel will debate.
The High Cost of European Union Bureaucracy [Cato at Liberty]
“HEALTHCARE WILL PASS THE SENATE” Sen. Judd Gregg (R-NH) will join us with his perspective. BULL/BEAR DEBATE
NOV 16, 2009 11:13A.M. *(bull) Jack Ablin, Harris Private Bank Chief Investment Officer *(bear) Joe Battipaglia, Stifel Nicolaus Market Strategist
The clever folks at the Taxpayers Alliance in the United Kingdom have a new video documenting some of the wasteful European Union programs that are imposing a heavy burden on average people.
Please join us. The Kudlow Report. 7pm ET. CNBC.
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On CNBC’s Kudlow Report [Larry Kudlow’s Money Politic$]
How Is Sotomayor Doing? [Cato at Liberty]
NOV 16, 2009 11:03A.M.
I was one of those who opposed the nomination of Sonia Sotomayor to the Supreme Court, mainly because the pick was based on race and gender rather than merit and she was disingenuous and obfuscatory at her confirmation hearings. Well, the Court still hasn’t decided any cases argued with Justice Sotomayor on the bench — and the first term isn’t always indicative of the kind of jurist a new justice will be – but we do have some early statistics about her performance.
NOV 16, 2009 10:47A.M.
It turns out that, unlike her next most junior colleague, Justice Alito — who hung back early in his tenure while learning the rhythms of the Court – Justice Sotomayor has not been a shrinking violet in her questioning of advocates. Indeed, according to a National Law Journal tally, during the 13 November arguments that just concluded, she asked 146 questions (or 11.2 per case), which is even ahead of where Chief Justice Roberts was at this point in his career. And, because Sotomayor speaks more often than her more reserved predecessor, Justice Souter, she has made a “hot” bench even hotter.
This evening at 7pm ET: BEN BERNANKE’S SPEECH: An eye on the Fed, dollar & gold Panel: *Steve Liesman, CNBC senior economics reporter *Peter Morici, University of Maryland Robert H. Smith School of Business Professor; U.S. International Trade Commission Fmr. Chief Economist *Andy Busch, BMO Capital Markets; CNBC Contributor *David Goldman, Associate Editor First Things Blog
By another indicator, however, Sotomayor ranks at the bottom of the Supreme Court table: Apparently her questioning has not yet generated a single laugh (as measured by such indications in the argument transcript). Not surprisingly, Justice Scalia leads in that department — as he long has, both in absolute and per-question terms – with the Chief being the only other justice in double figures. Joining Sotomayor with a goose-egg so far this year are Justices Ginsburg and Thomas (who hasn’t asked a question since 2006). If you’re curious about last year’s final standings, see here.
OBAMA IN CHINA The China challenge & currency buzz CNBC chief Washington correspondent John Harwood will join us from Beijing.
For what it’s worth, all this accords with the sense I’ve gotten from the handful of times I’ve been to the Court for oral argument so far this term. To my mind, Sotomayor is still acting as a Court of Appeals judge — or maybe even a district judge – asking simpler questions about the factual record or procedural history rather than the broader issues the
CHINA CURRENCY DEBATE Yuan a strong dollar?
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Court tends to grapple with. And therefore I’ll go out on a counterintuitive limb here to predict that, as Sotomayor settles into her new role, her questioning will become less frequent but more
17 November 2009
The health-care reform proposals now before Congress could further strain state budgets because they would expand Medicaid, Genest said.
substantive. Genest said Congress should overhaul Medicaid, now funded jointly by state and federal governments but run by the states. The federal government should cover more of the costs, give states more flexibility or even make a drastic switch and let federal officials take over Medicaid completely, he said.
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Federal Assumption of Medicaid Costs [Cato at Liberty]
“If you want to imagine a crisis, as a thought experiment, imagine all 50 states writing a letter to the federal government saying, ‘We’re no longer providing Medicaid.’ That would get Congress’ attention. And that’s about the only real leverage we have,” Genest said.
NOV 16, 2009 10:43A.M. From the standpoint of Americans who prefer less government, one of the worst developments of the 20th century was the federal subsidization of state and local spending. The result has been bigger government at all levels. Medicaid represents the largest portion of federal money to the states. The states administer their own Medicaid programs, but the federal government picks up 50 to 83 percent of the tab depending on a state’s income. The estimated price tag of the federal share for fiscal year 2009 is $260 billion.
Current health care legislation in Congress threatens to increase state Medicaid spending. In the House passed bill, the federal government would pick up 100 percent of Medicaid’s expansion until 2015 when it would drop to 91 percent. However, the future is unpredictable and it’s not hard to imagine a future Congress keeping it at 100 percent federal funding.
One result of the federal government paying for half or more is that it encourages the states to expand enrollment and benefits. It also makes it politically difficult to cut state Medicaid spending because of the accompanying loss of federal dollars.
According to the Congressional Research Service, the House bill also contains a provision that could be intended to create a justification for greater federal assumption of state Medicaid spending: H.R. 3962 would require GAO to study federal matching payments made to state Medicaid programs to make recommendations on the FMAP formula to Congress. By February 15, 2011, GAO would be required to submit a report based on this study assessing the effect on the federal government, states, providers, and beneficiaries of making the following changes to the FMAP formula: (1) removing the 50% floor or 83% ceiling, or both and (2) revising the current FMAP formula to better reflect state fiscal capacity, state efforts to finance health and long-term care services, and to better adjust for national or regional economic downturns.
A 2007 analysis on the exorbitant future costs of Medicaid by Jagadeesh Gokhale illustrates how the program’s price tag has skyrocketed since its creation in 1965 (see chart here). Over the decades, the states expanded their programs whenever the economy was growing and the tax revenues were flowing. When the economy went into recession and the revenue dried up, the states generally didn’t scale-back benefits and sometimes they asked for bailouts from the federal government. The 2009 stimulus package provided an estimated $87 billion in federal Medicaid money for the states. If the economy remains stagnant over the next few years and state tax revenues fail to rebound, further pressure will mount on the federal government to continue bailing out state Medicaid programs. The nightmare scenario would be for the federal government to assume the full costs of Medicaid under state pressure.
See this essay on the need for a return to fiscal federalism. Update: The Washington Post reports this morning that the House health care reform bill contains an additional $23.5 billion Medicaid bailout for the states. The provision would extend by an additional six months (through 2011) the stimulus legislation’s “temporary” increase in
California Gov. Arnold Schwarzenegger’s budget director, Michael Genest, recently raised the idea:
the federal government’s share of total Medicaid spending.
Genest, who is retiring at the end of the year, warned that California’s budget problems will persist even after the state works its way through this recession. He singled out MediCal, the state’s Medicaid health-care program for the poor, as unaffordable for the state. If the program’s costs continue to climb 8 percent a year, the state will have little money left for anything other than schools and debt service by 2040, he said.
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The Remnants of “War on Terror” [Cato at Liberty“War on Terror”] NOV 16, 2009 10:37A.M. Former New York City mayor Rudy Giuliani appeared on Fox News Sunday this weekend to argue against the Obama administration’s plan to try some alleged terrorists in New York courts. He did not acquit himself well. Giuliani argued, for example, that criminal defendants aren’t tried “at the scene of the crime.” Criminal defendants are almost always tried in the jurisdictions where their crimes took place (not at the actual crime scene, of course). Giuliani’s insistence on misstating basic criminal procedure showed that he was twisting to score points against the administration. This is inappropriate political use of terrorism issues. But Chris Wallace roasted Giuliani—with quotes from Rudy Giuliani. Of prosecuting the 1993 World Trade Center bombers, Giuliani said: “[Y]ou put terrorism on one side, you put our legal system on the other, and our legal system comes out ahead.” Giuliani said that the trial of Zacharias Moussaoui shows “that we can give people a fair trial, that we are exactly what we say we are. We are a nation of law.” As he did during his failed presidential campaign, Giuliani appears caught in a terror-warrior time warp. He criticized the Obama administration for eschewing the regrettable phrase “war on terror,” and he betrayed no awareness of what has dawned since 9/11 on the rest of the country: Terrorism seeks overreaction on the part of victim states. Cool, phlegmatic prosecution of terrorists deprives them of rhetorical victories that empower them by drawing others to their side.
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17 November 2009
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