Categories
judiciary tax policy too much government

Supreme Oxymorons

With the Supreme Court’s decision in National Federation of Independent Business v. Sebelius, the Patient Protection and Affordable Care Act has achieved its first milestone: The repudiation of logic, the Orwellian assertion that A both is and is not A.

The reform package, popularly known as Obamacare, requires that individuals buy medical insurance. If you fail to do so, the law imposes a fine.Justice Roberts

The zillion page legislation refers to this financial penalty 18 times. It never refers to a tax.

Its principal booster, President Obama, repeatedly insisted it wasn’t a tax. And as Justice Antonin Scalia wrote in his dissent, “We have no doubt that Congress knew precisely what it was doing when it rejected an earlier version of this legislation that imposed a tax instead of a requirement-with-penalty.”

But Chief Justice John Roberts, a George W. Bush-nominee, joined the four liberal justices to declare that what was not a tax, when proposed and passed, now is a tax — so that it could be declared constitutional under Congress’s taxing power. Roberts explains:

Congress did not intend the payment to be treated as a “tax” for purposes of the Anti-Injunction Act. The Affordable Care Act describes the payment as a “penalty,” not a “tax.” That label cannot control whether the payment is a tax for purposes of the Constitution, but it does determine the application of the Anti-Injunction Act.

Only were Obamacare not a tax could it be litigated at this time under the Anti-Injunction Act. Accordingly, the majority says it is not a tax. But it can only be ruled constitutional if it is a tax. So, the High Court calls it a tax and not a tax at the same time.

The dissent called this “remarkable.” Stronger words spring to mind.

This is Common Sense. I’m Paul Jacob.

Categories
folly responsibility

The Stockton Bust

Stockton, California, had seen a flurry of new home projects right up till the mortgage market crash. But, boy, did that come to a screeching halt. The crash led to foreclosures, which led to lower revenues from property taxes for the city. And though the city tried some spending cuts, they haven’t been enough. The Stockton City Council just voted, six to one, to seek federal bankruptcy protection.

Reasons for the bankruptcy, however, are not confined to reduced revenues. Add “soaring pension costs” and “contractual obligations” to the list of disaster factors.Stockton Bankruptcy - an illustrative image, not a photojournalistic artifact

And it’s pensions and medical insurance that make up the elephant’s share of “contractually obligated” must-pays. We’ll see if official bankruptcy will allow the city to get out from under that mess. The Chapter 9 plan includes dropping medical benefits for currently fully-covered retirees.

Who’s to blame? Politicians who negotiate really cushy deals for their (our) employees. The contracts obligate future taxpayers to pay out huge pensions for future retirees, rather than being funded (through insurance and investment) at the time of salary disbursement. The problem is that politicians love to make promises others must keep. Specifically, in this case, they contract defined benefit pensions not defined contribution pensions.

It makes no sense to do this, of course. It encourages irresponsibility, and is (to use a buzzword that should be used often against its usual purveyors) unsustainable. As proven by the Stockton bankruptcy.

Stockton is, so far, the largest American city to go belly up. We can expect further such busts, since the cause of Stockton’s problems — under-funded pensions coupled with full-coverage, gold-plated, lifelong health insurance for government retirees — remain endemic throughout the country.

This is Common Sense. I’m Paul Jacob.

Categories
Thought

Abraham Lincoln

Adhere to your purpose and you will soon feel as well as you ever did. On the contrary, if you falter, and give up, you will lose the power of keeping any resolution, and will regret it all your life.

Categories
Thought

Abraham Lincoln

This is a world of compensations; and he who would be no slave, must consent to have no slave. Those who deny freedom to others, deserve it not for themselves; and, under a just God, can not long retain it.

Categories
insider corruption too much government

Squelching the Revolution

During the months of primaries and caucuses, the popularity of Ron Paul was a fear expressed amongst both neoconservative and “mainstream” Republican insiders in hushed tones, rarely ever surfacing, but instead roiling under politics’ prudential lid. Now that Mitt Romney has sealed the nomination with enough delegates from the primary states, GOP insiders are trying to solidify their position.

Instead of magnanimously bringing Ron Paul’s supporters into the party to court them for the next four years, they seem to be doing their darnedest to keep them out. Take Romney’s gubernatorial state, Massachusetts.No Revolution

The GOP machine, there, has required that the Ron Paul nominees to the Tampa convention sign an affidavit to support Mitt. This is something new. Just for Ron Paul delegates. And of course some

libertarian-leaning delegates balked at the notion of signing legal affidavits pledging what they had committed verbally at the caucuses where they were elected. Many later submitted them, but not until after the deadline.

As a result, the committee disqualified them, winnowing the number of Liberty delegates and alternates to the convention from 35 to 19. . . .

Not surprisingly, the duly elected delegates “feel cheated.”

A spokesman for the Massachusetts Republican Party would not say why the affidavits were required of delegates this year, and the chairman of the Allocations Committee would not agree to an interview. Instead, the chairman offered an e-mailed statement saying that the Romney campaign, through its representative on his committee, had the right to reject delegates for “just cause.”

When I prophesy negative consequences of a Mitt Romney presidency, this sort of thing lingers in my mind. What is the GOP afraid of? Actual limits on government?

This is Common Sense. I’m Paul Jacob.

Categories
Today

June 26

On June 26, 1997, the Supreme Court of the United States rules that the Communications Decenty Act violates the First Amendment. Six years later, to the date, the Supreme Court rules that gender-based sodomy las are unconstitutional. Exactly six more years later, the Supreme Court decides, in District of Columbia v. Heller, that the Second Amendment to the United States Constitutional protects an individual right to bear arms, at least in the District of Columbia, which is directly supervised by Congress.

Categories
free trade & free markets general freedom ideological culture individual achievement

Two Legacies

Two great economists died this month.

Anna Schwartz, co-author with Milton Friedman of the classic A Monetary History of the United States, 1867-1960, passed away last Thursday, at age 96. For reasons known only to a few Swedes, she did not receive the Nobel along with her more famous research partner.Anna Schwartz and Elinor Ostrom

Elinor Ostrom, on the other hand, who died about two weeks earlier, at age 78, did manage to nab a Nobel.

While Mrs. Schwartz may not have received the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, she had received the more popular honor of being dubbed “the high priestess of monetarism.” She knew more about the history of banking and finance than just about anyone. Tellingly, her intellectual odyssey didn’t stop when she reached retirement age.

In recent years, she attacked the politically popular notion that bailouts are a good idea during economic downturns. She also came out against the reappointment of Ben Bernanke as Fed chairman, and argued that government was the main instigator of the 2008 financial bust.

She knew how to make waves.

Elinor Ostrom focused her work not on finance but on the problems associated with managing common-use resources. She found that government regulations tended to mismanage resources, while individuals and communities better negotiated creative and effective solutions to problems that previous economists deemed insoluble without government.

Like Anna Schwartz, she was much more than an armchair theorist. She didn’t merely draw equations on a blackboard and pontificate on how necessary it is for “government” to “fix it.” The evidence — which they collected — is in, government most often is the problem that must itself be fixed.

This is Common Sense. I’m Paul Jacob.

Categories
Thought

Abraham Lincoln

Mr. Clay’s lack of a more perfect early education, however it may be regretted generally, teaches at least one profitable lesson; it teaches that in this country, one can scarcely be so poor, but that, if he will, he can acquire sufficient education to get through the world respectably.

Categories
judiciary national politics & policies term limits

Reform Follows Function

Waiting for this week’s Supreme Court decision on Obamacare, which most folks expect to strike down the mandate and perhaps the entire law, George Washington University Law Professor Jonathan Turley argues in the Washington Post that the court should be expanded from nine justices to 19.

FDR, no doubt sitting up in his grave listening for details, would find Turley’s suggestion of allowing each of the next five presidents to choose two new justices very politic, even sneaky.Jonathan Turley

One reason to add more justices, Turley hazards, is the damage caused to popular government when controversial issues are decided narrowly. Predicting a 5-4 vote on Obamacare, he unaccountably thinks it would be less controversial to then give the President two new justices so that this law (or other Obamanisms) would be upheld 6-5.

If I have my arithmetic correct, there can be legal cases decided by a single justice with any odd number of justices . . . nine, eleven, 13, 15, etc. That is why we choose odd numbers, if not odd justices.

Prof. Turley is correct, however, in addressing the awesome power of each Supreme Court justice, the fierce political battles each nomination now engenders and the ensuing politicization of the Court. He simply applies the wrong medicine.

A better reform would be to end lifetime tenure for justices on the High Court (but not for lower level federal judges). By requiring rotation no one could lock in a majority on the court for decades without sustained majority support of the people.

Turley informs us that 60 percent of the public already favors this approach. But the Washington elite? No such support.

This is Common Sense. I’m Paul Jacob.

Categories
Thought

Abraham Lincoln

Slavery is founded in the selfishness of man’s nature — opposition to it is in his love of justice.