Civitas Review Online

Complete ignorance of economics and markets in general is the only explanation for those that continue to insist on "universal" or "single-payer" health care. Sheldon Richman explains why in this outstanding article.

"Case in point: How would one see through the flimflam served up as health-care policy without a working knowledge of economic principles? When politicians promise "universal and affordable" medical care and insurance, how else are we to know that those promises can’t be kept. Indeed, attempting to keep them would gravely damage our medical care (even more), our prosperity, our liberty."

Richman describes how an insurance market (and therefore the health care industry as a whole) simply can not function properly in the context of, say, Hillary Clinton’s vision of health care.

"Clinton declares, "I want to stop the health-insurance companies from discriminating against people because they’re sick."

One doesn’t know whether to laugh or cry at a statement like that. Is it ignorance, stupidity, or demagoguery?"

The article explains why such a mentality would inevitably lead to price controls, which of course everywhere and always leads to rationing and shortages. How refreshing would it be to find just one politician who could articulate why it is in fact the countless ways in which government interferes with the marketplace that is primarily responsible for escalating health care costs? Don’t hold your breath.

"In fact, the politicians love those interventions. So they promise to lower medical costs through direct controls. Even a modest familiarity with how markets work reveals that this would make things worse. Is it too late for Americans to see through the con game?"

Here in North Carolina, we have our own resident useful idiot who has bought the "con game" hook, line and sinker.

Earlier this week the News & Observer reported on the findings of the Pew Forum Survey on Religion and Public Life. The results were certainly worth reviewing and made for interesting reading.  Nevertheless, as I transplanted Catholic, I found the comments of Russ Elmayan, the chief operating officer of the Diocese of Raleigh far more interesting. In the article, Mr. Elmayan is quoted as saying there are approximately 210,000 registered Catholics in the diocese, and an estimated 225,000 unregistered Hispanic Catholics who attend mass weekly but do not fill out membership forms. Do we mean to say the number of unregistered Hispanic Catholics actually exceeds the number of registered Anglo-Catholics? No doubt the issue of illegal immigration is driving much of the numbers. While I know the diocese has an official policy of welcoming all illegal immigrants, the reality is the issue has divided those within the church as much as those outside of it. The figures speak of the great challenge facing the Church. Is there a better time for the Church and our communities to begin a public discussion on the issue of illegal immigration?

Apparently, the Triangle is struggling for jobs.  Or is at least struggling more than the more rural parts of the state.  Why else would the state be giving $5.6 million to lure 300 jobs to poor, desolate, struggling Cary.  It seems that any town that can afford to give a company $500,000 of taxpayer money in corporate welfare isn’t really hurting for jobs all that much, are they?

So why exactly are we subsidizing jobs, when according to the N&O:

The expansion underscores the strength of the health-care sector,
even amid a slumping economy, and its growing role in this state and
region. The aging population has increased demand for medical services
and technology, benefiting companies in that sector.

More of
those businesses have come to North Carolina in search of the talent
necessary to develop equipment and drugs. The state is the nation’s
third-largest hub for biotechnology, as measured by the number of
companies. Much of that activity is centered in the Triangle.

Let’s see… rapid growth in health care sector, aging population, high need for the services and many similar businesses already located in the area.

Seems like the market is showing there is already a need for these jobs, so why exactly are we paying Siemens to do something they were going to do already?

The company’s own growth is fueled by acquisitions and rising demand
for medical imaging, scanners and other technology it makes. That, in
turn, has increased the need for hospitals and its own employees to
improve their skills on the equipment.

"They’re expecting a lot
more people going through there for training," said Tom Schaffner, a
spokesman for Siemens Medical Solutions in Malvern, Pa.

Oh, there’s increased market demand for these products and Siemens is expanding to fill that role. Hmm… growth in the market, more opportunity to make money, need to expand already there to keep up with growth.  So, why exactly are we subsidizing them?

NC Justice Center has put out their new "At the Crossroads" agenda, which has a number of recommendations for transportation reform. In short, it’s pretty good. Next week Civitas will release its "Blueprint for Transportation in North Carolina". Observers of the political zigzag in North Carolina may be surprised at the overlaps between our respective recommendations.

To point out a couple of points of divergence, Civitas does not buy into "smart growth" and so-called anti-sprawl measures, which we believe are counterproductive when it comes to both environmental protection and urban livability. Of course, we also think light rail as a form of transit is not only regressive, but a kind of fetish that comes at astronomical (opportunity) costs. Nevertheless, while "At the Crossroads" includes smart growth and rail transit as elements of its overall recommendations, these are mostly muted. Their focus remains primarily on changing both the revenue model and the allocation model for transportation funding and construction statewide.

As a note, I believe both the Civitas and the NC Justice Center approaches to transportation reform will also mean a lot to the preservation of beautiful natural spaces around the state. After all, unnecessary roads don’t get built under our common schemes.

NC Justice Center (and, thus also NC Policy Watch) rarely have overlap with the Civitas Institute when it comes to most political issues. Our philosophies are very different. But when it comes down to the future of our state, if we find areas of common ground it becomes necessary to put down our pens-as-swords and extend the olive branch of transpartisan cooperation. This is only my opinion of course, but partisans, politicians, and bureaucrats should pay close attention to both of our recommendations before going any further down that tortuous, crumbling road — built at great cost by the status quo.

Kudos to NC Justice Center.
-Max Borders

On the situation in Iraq:

"As for the question of whether the surge is working, I can only state
what I witnessed: U.N. staff and those of non-governmental
organizations seem to feel they have the right set of circumstances to
attempt to scale up their programs. And when I asked the troops if they
wanted to go home as soon as possible, they said that they miss home
but feel invested in Iraq. They have lost many friends and want to be a
part of the humanitarian progress they now feel is possible."

John McCain?
Gen. Petraeus?
President Bush?

Nope.  It’s Angelina Jolie — yes, that Angelina Jolie, the actress.

Now John McCain hates the children. Can the left get any more self-parodying?
(Compare and contrast.)
-Max Borders

This outstanding article by John Chapman offers a blueprint for NC municipalities. One primary culprit in stagnating economic growth for a city? A high ratio of public employees to citizens:

"the ratio of residents to city employees, a key measure of city government productivity, is 50:1 in Detroit, one of the worst in the United States, but is 203:1 in Indianapolis, one of the best."

Which city would you rather live in right now?

This flies in the face of the "progressive" chatter about the "essential services" that must be provided by an ever-expanding government bureaucracy to ensure an acceptable "quality of life."

Towns and counties concerned about balancing their budgets in light of current and future population growth? Privatize services:

"This is how Indianapolis cut 43% (1,200 workers) of its non–public safety workforce, and shaved $480 million from its budget in 8 years."

But what about all those public employees losing their jobs?

"In fact, during Goldsmith’s (Indy’s mayor) 8-year tenure, not one city employee became unemployed; the employer merely changed, … And happily, the public sector union, AFSCME, generally applauded Indianapolis’s public-private partnership excellence, especially when workers received incentive bonuses allowed by new ownership and governance."

Of course, we are also bombarded regularly about how citizens "demand" services from their local government. It must follow, naturally, that Indy’s citizen’s moved out of town because there’s no way a reduced public service sector could accommodate such "demands," right?

"During his (Goldsmith’s) eight-year tenure as mayor, the city’s population increased by nearly 50,000 residents, induced by a more business-friendly environment and its corollary, smaller government."

So the city added 50,000 residents and simultaneously cut nearly half a billion from their budget? Yes, folks, it can be done.

The article is not exclusively devoted to Indianapolis, and is well worth the read. If nothing else, you’ll get your money’s worth with this quote from Green Bay Mayor Jim Schmitt: "entrepreneurs know what they’re doing; the best thing we can do is get out of their way."

Amen.

I came back from our Civitas luncheon yesterday, upset because the panelists largely ignored the bulk of the healthcare results of the DecisionMaker Poll, which I thought were far more important than all the speculating D.G. Martin and Tom Fetzer did on McCain, Clinton, Obama and the mobocratic winds of presidental politics.

Apparently someone felt the same way I did when Fetzer remarked that healthcare is just too "complicated" an issue to get any traction in the election — despite the fact that affordability in healthcare is the #1 concern among NC voters:

GOP political consultant Tom Fetzer at the Civitas Institute poll luncheon today said health care is too complicated to be a deciding issue in elections. It can’t be summarized in 30 seconds.

Let’s try 10 seconds:

I wouldn’t change a thing.

If I was stumping, I might only add some preliminary rhetorical questions — making the elevator pitch the punchline:

1) Why don’t you have the right to buy less expensive insurance in other states?
2) Why do employers get a tax deduction to buy employees insurance, but you get no tax deduction to buy your own insurance?
3) Why are North Carolinians forced to pay for 47 coverage items like drug abuse treatment and providers like chiropractors — when they could choose which items they need and pay less?
4) Why don’t we know much of what anything costs in this state if we wanted to buy healthcare out-of-pocket?
5) Why are we paying to put more and more people on Medicaid, when we could offer subsidies to buy health insurance at a much lower cost to taxpayers.
6) Why isn’t N.C. doing anything about malpractice awards, which drive up costs for everyone?
7) Why does the party in power in this state want our healthcare decisions to be controlled by government?
Why does the party in power in this state have no interest in making the health insurance market more competitive, and thus less expensive?
9) Why does NC punish the individual and group markets with costly, burdensome regulations, when that’s only about 40 percent of the insurance market?
10) Why is the state trying to put middle class kids on Medicaid, when parents can afford insurance, and when doing so only drives up insurance costs for everyone else?

OK, OK. Maybe I’m proving Fetzer’s point to a degree by offering this laundry list of grievances. It does get complicated. But Coletti’s point is simple: the healthcare "market", such as it is, is messed up because government has turned it into an expensive, complicated Rube Goldberg machine that has nothing to do with consumer choice and everything to do with bureaucratic, employer, special interest and insurance company control. Government must get out of the way to empower the consumer again. That is your right.
-Max Borders

North Carolina is losing it’s edge. This eye-opening state-by-state index by Art Laffer and Steven Moore illustrates convincingly the close correlation between state policy and economic prosperity.

Years of one party rule mean NC is moving toward the Jennifer Granholm/European socialist model that has left Michigan and Old Europe in economic stagnation for years now. Nearly double-digit unemployment, outward migration and capital flight mark the states with policies hostile to entrepreneurship and economic freedom.

The more North Carolina gets into the upper marginal tax rates, continues to overcompensate by giving away corporate welfare (unsustainable), and spends like drunken sailors, the faller we will slip on this index and the further we will sink into the economic malaise that puts us at #19 – fair to middling – but poor next to our southern neighbors (Tennessee 5, Virginia 4, and Georgia 8).
-Max Borders

With the release of our February DecisionMaker poll today, I wanted to explore some of the crosstabs to see if any noticeable trends develop.  We’ll start with the Presidential race.

First, as a reminder, we poll likely General election voters, and as such the head-to-head Primary matchups are not a predictor of how the election will turn out.

In the head-to-head of Obama v. Clinton, the poll shows Obama with a 14 point lead — 38-24.
But if you look at the groups who are more likely primary voters, Obama’s lead widens.
Among those who ID themselves as "Very liberal" or "Somewhat liberal" his lead widens to 24 points.
Among those who say they "Always vote Democratic" his lead widens to 22 points.
He has a 56 point lead with African-American voters (66-10).
He leads by at least 21 points in every age demographic except 65+ where he leads by 1%.

Therefore, I’d venture to guess Obama’s lead over Clinton is actually higher than the 14 point margin we have it.  I’d say if primary voters are polled, the lead may be up in the high teens to around 20.  All this is really moot though since this race will be over next Tuesday when Obama wins TX and OH (Yes, I’m making that prediction).

When we take a look at the General election matchup, some interesting trends emerge.  Our poll has McCain with a 12 point lead on Clinton (48-36) and a 10 point lead on Obama (46-36).
The fun in the numbers is where the differences occur.
Among Unaffiliateds, McCain leads Clinton 46-36, but Obama leads McCain 43-36.  So McCain goes from a +10 to a -7.  A pretty big swing.
Breaking the unaffiliateds down even more, Obama is making his largest strides among unaffiliated women.  McCain beats Clinton among unaffiliated women by 6, but Obama beats McCain by 17.
I know it’s early, but I think we just found one of the key demographics for this year’s election.  It’ll be interesting to watch these numbers over the next 8 months.

One potential problem for Obama is that his support seems to erode some among self-ID’d "Very liberals" or "Somewhat liberals".  Among "Very liberals" Clinton leads McCain by 73 points (85-12), but Obama only leads by 61 points (75-14), with an strong increase in those who "aren’t sure".
Are these just dissatisfied Clinton hard-cores who will come back around in November?  Is there a chance that the Clintonites get upset at what has happened to their candidate that they stay home?

Another interesting sample is that McCain is getting 10% of the African-American vote against Clinton.  Protest vote for Clinton’s earlier race baiting in South Carolina?  Quite possibly.

Similarly, many people have theorized that McCain is unappealing to the conservative base and they stay home.  So far, the numbers don’t show that happening.  His numbers among "very" and "somewhat" conservative voters hold the same against either Obama or Clinton and the number of "not sures" (the answer dissatisfied conservatives would give) is not any higher among those groups than any other demographic or the population as a whole — about 16%.  And converse to the argument, among people who say they "always vote Republican" (a truer indication of the base), only 5% say they are undecided and McCain leads Obama 92-3.