The Unintended – But Expected – Consequences of Obamacare

Anti-Statism, Articles, Business, Health Care, Nanny Statism, The Basics, Totalitarianism
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The Patient Protection and Affordable Care Act – aka Obamacare – was expected by economists to cause economic changes.  (Here is the act in a handy 906-page .pdf file.)  Some predicted lower employment, either from employers’ reducing employees’ hours to keep them from being deemed full-time, or simply by firing employees whose marginal productivity isn’t more than the $300+ additional cost, per month, of complying with some of the employer mandates.

Put simply, mandating increased per-employee costs will cause employers to react, and the employees most at risk of losing hours or jobs will be the ones with the lowest productivity:  the minimum-wagers the government says it’s trying to protect.  Any time the government takes control of (more of) an industry, the result inevitably will be unintended consequences. People seek to do what produces the best outcomes for themselves; we are not the static, obedient walking statistics government pretends we are.  We actively seek ways to avoid burdens, because we need to feed our families.

Obamacare provides that employers cannot reduce employee wages to avoid the additional costs imposed on the employers, and every employer with 50 or more employees must participate in providing health care or face punitive fines. Individuals who are not covered by a welfare program (Medicare, Medicaid) or by their employer must purchase their own insurance on the new “health care exchanges” to be set up by the states, or pay a fine along with their income taxes every April 15.  Who are the people who don’t want medical insurance?  Healthy young males, who are expected to pay as much as $5,800 per year, essentially to subsidize health care for the poor and sick.  Their penalties will be far lower than that, at least at first, that we know of.  What do you think they will choose?

Enough about the act.  You can read about it from the links above.  Here are the consequences:

Those of you who told Trader Joe’s you won’t shop there any longer because they’re not covering health care for their part-timers should first read Trader Joe’s explanation (Trader Joe’s will give the employees cash and let them shop for themselves; that way, the employees get a tax break, and at any rate Trader Joe’s can’t offer the giveaway deal the government is forcing on everyone); and second, should be prepared not to shop in very many places any more:  Forbes writes of Walgreen and 17 other large retailers doing the same thing. Worse, 301 employers (that we know of so far) are cutting employee hours and firing people.  The most perverse part of that:  62 of the employers are private-sector, and 239 are government employers, including school districts.  In one survey of small businesses, 41% have delayed hiring, 20% have reduced hours, and 20% have reduced payroll, all because Obamacare would be too burdensome otherwise.

Another unintended consequence of creating government tax-and-spend “giveaways” that (as we saw above) threaten to harm the poor more than the rich:  Fraud.  Obamacare-related scams were and are being predicted—by federal officials, no less.  Thieves are expected to prey on the poor, the old, and the ignorant.  The fear is strong enough that the White House and the Justice Department have felt the need to reassure the public, with DOJ having to build a special initiative around the issue.  Here’s a list of the scams that have already been reported to law enforcement.

Some unintended consequences were not predicted by many, if at all.  Labor unions, the darling of the political left, are stung because they somehow could not foresee that employers would cut hours; and the Obama administration remarkably has refused to add special subsidies for them.

A headline from the notoriously left-leaning Pew research center:  Most uninsured Americans live in states that refuse to offer their own health insurance exchanges.  The people the government claimed it most wanted to help are going to have to use the federal exchanges.  (The real problem here, if you consider it a problem, is those people are the ones least likely to know they can use the federal system.)

Here’s a wild one:  Since Obamacare was enacted in 2010, 21 states have enacted new laws—and the federal government is powerless to stop this—banning private-insurance coverage of abortions.  THAT was certainly unexpected.

Obamacare subsidizes the health care of people who stay below certain income maxima.  The obvious and foreseeable unintended consequence of that, of course, is that some people at the margins will face incentives to earn less.  A dollar of additional income, for some, will mean losing a $5,000 subsidy.  It would be foolish for anyone facing that choice to work an additional hour and lose almost $5,000.

Finally (for now), employers who have just over 50 employees will fire workers to stay below that magic number and avoid the extra burdens, as several of the links above demonstrate.  If a CEO and board of directors will sell their bank, aggressively take the risk of buying other banks, or sell assets to avoid certain burdens that come with size under the Dodd Frank Act, a small business owner whose business feeds his family will certainly fire workers to avoid Obamacare.

There will be more unintended consequences, both expected and unexpected. I’ll stop here.  (Just one more:  To be able to continue to make a profit—i.e., stay in business—insurers are going to limit the insureds’ choices of service providers.)  I’m not even the first person to write about this; many of the links above are to articles with “Obamacare” and “unintended consequences” in their titles.  I’m just the most recent to write about it, so I have the newest data.  Google “unintended consequences of Obamacare” regularly for updates.  The insurance exchanges open October 1, so the coming months will be a busy time for discovering new problems with government medicine (or rediscovering known ones).  We appear doomed to repeat the inescapable history of government intervention proved sour, so we might as well be informed about it.

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On the Boston Lockdown

Immigration, Police Statism, Private Crime, The Left, The Right, Totalitarianism
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One doesn’t have to be any sort of radical to be appalled that thousands of police, working with federal troops and agents, would “lockdown” an entire city—shutting down public transit, closing virtually all businesses, intimidating anyone from leaving their home, and going door to door with SWAT teams in pursuit of one suspect. The power of the police to “lockdown” a city is an authoritarian, borderline totalitarian power. A “lockdown” is prison terminology for forcing all prisoners into their cells. They did not do this to pursue the DC sniper, or to go after the Kennedy assassin, and I fear the precedent. It is eerie that this happened in an American city, and it should be eerie to you, no matter where you fall on the spectrum. You can tell me that most people in Boston were happy to go along with it, but that’s not really the point, either. If two criminals can bring an entire city to its knees like this with the help of the state, then terrorism truly is a winning strategy. (And we should also keep in mind that the overwhelming majority of the massive police response did not aid in capturing the suspect—it ultimately turned on that old fashioned breakthrough—a normal denizen calling the authorities with information.)

If America suffered a bombing like the Boston Marathon atrocity every week, America would feel like a very different place, although the homicide rate would only be about one percent higher. I acknowledge the maiming was on a mass scale, but this kind of attack has to be taken in perspective in terms of how much of a risk it poses to the average American, because we have to consider what response the people would tolerate in the event of more frequent or far worse attacks.

If the people of the United States will cheer seeing a whole city shut down, even for just a day, in the event of a horrific attack that nevertheless had 1/1000th the fatalities and about two percent of the casualties of 9/11, what would Americans support in light of another 9/11? What about a dirty bomb going off in a major city? The question has nothing to do with what government wants to do, or whether police statism is a goal or simply a consequence. What will the *people* want and expect the government to do if tens of thousands were chaotically killed and injured in a terrible terror attack, or if many small attacks hit the country? I fear they would welcome the abolition of liberty altogether, given their reaction to last night. That, of course, is altogether the wrong response. If we cannot look at the police reaction last night very critically, there is really no hope for even moderate protection of our civil liberties today.

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Drone Rage: A Day Late and a Sequester’d Dollar Short?

Anti-Statism, Statism, Totalitarianism, War
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The brilliant Glenn Greenwald tweeted today:

Must-read from ProPublica: The Drone War Doctrine We Still Know Nothing About (via @robertgreenwald)

Must reading indeed. Here’s what I don’t get about the drone debate. Why the @#$% did it take so long to start? Admittedly, I’ve grown somewhat numb to the fact that so-called conservatives are attacking the current POTUS about issues that seemed somehow obscure to them when Shrub was manning the con. Still, one would hope that basic human decency would, maybe, cause some kind of reaction to senseless killing of men, women, and children even in the far-away Middle East. Yet, there has been an alarming lack of concern about the drone program before now. Given CIA director nominee John Brennan’s recent cageyness about plans to use drones domestically, everyone is up in arms. The British are coming! One drone if by land! Two drones if by sea!

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Unipartisanship is the new bipartisanship

Statism, The Left, The Right, Totalitarianism, Vulgar Politics, War
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Romney bans certain kinds of guns; Obama supports war and Bush-era doctrines; Romney enacts (even more) socialist-fascist health care; Obama has a near opaque administration in spite of the desire to be transparent.

The so-called “left” promotes a policy (say, universal healthcare or the individual mandate or the health care exchanges). The “right” opposes it. The opposition is usually superficial and us used as talking points to obtain votes. The object of power is power, after all. Assuming the policy becomes law, and assuming (as is often the case) it receives widespread support, the right becomes less vociferous about repealing the law. At best they want to reform; usually either nothing happens or the mildest of cosmetic changes are made, if only to appease the fringe party supporters. Today’s progressive, becomes tomorrow’s conservative. Already, for example, the financially devastating Obamacare that was such a hot topic a year ago is starting to go away in the eyes of most–that is, if you don’t have a business facing ever-higher health care costs. Soon the right will stop talking about repealing it or replacing it with something else. Florida governor Rick Scott, who initially opposed setting up the FL healthcare exchange, has changed his tune–how unexpected!

On the other “side” of the political spectrum, the totalitarian and warmongering right wing, whose most recent icon and trend setter is GWB, pushes for war and empire and crackdowns on civil liberties. The left claims to oppose it. When Bush II was in power the progressives, ever irate, regaled us with their smugness (and, as we now know, insincere) opposition to the Bush administration’s policies and tactics. Enter a democratic president. Oh my–what happened!? Suddenly Obama adopts and relishes in continuing core Bush doctrines as well as expanding into new territories of despotism: droning and NDAA come to mind. Today’s warmongering conservative is tomorrow warmongering progressive.

I for one welcome our new unipartisanship overlords.

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Reality-Checking Che

Pop Culture, Totalitarianism
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I have never understood the popular infatuation with Ernesto “Che” Guevara, the Argentine-born Marxist revolutionary who instigated socialist revolts in three countries, or why people would want to wear clothing emblazoned with his face.  The man was a mass murderer, after all, and the architect (along with Fidel Castro) of the communist police state that rules Cuba to this day.  Unless one believes murder, wealth seizure and destruction, and the abrogation of civil liberties are justified means to political ends, why would anyone want to celebrate a person who engaged in all of these atrocities?

Thor Halvorssen, founder of the Human Rights Foundation, doesn’t understand it either, and in an open letter to Urban Outfitters published on Huffington Post this week, he questions the company’s reasons for offering Che-themed merchandise:

Although Guevara’s image has appeared on countless items for consumption over the last few decades as a symbol of change for the better, Guevara’s actual record is that of a brutal tyrant who suppressed individual freedom in Cuba and murdered those who challenged his worldview.

Guevara undoubtedly played a key role in the overthrow of the dictatorial Batista regime in January of 1959. However, despite promises of a new democratic government, within a few months he and Fidel Castro had designed and installed a full-blown police state that deprived the overwhelming majority of Cuban citizens of democracy and human rights.

From 1959 to 1960, the new government carried out summary executions of at least 1,118 people by firing squad. Guevara himself presided over the notorious La Cabaña prison, where hundreds of the executions took place. For comparison’s sake, the Batista regime was responsible for 747 noncombatant deaths between 1952 and 1959. The Cuban revolution under the direction of Guevara also saw the rise of forced labor camps which gave way a few years later to full-scale concentration camps. These were filled with dissidents, homosexuals, Jehovah’s Witnesses, Afro-Cuban priests, and anyone else who had committed “crimes” against the new moral revolution.

Note: it appears that Urban Outfitters no longer carries the poster that prompted Halvorssen’s letter.

It’s not just Urban Outfitters, of course; many companies over the decades have offered Che’s mug on everything from key chains to jackets to backpacks, snapped up primarily by college kids who dig the rebellious motif, or by hipsters who appreciate the irony of a leftist revolutionary icon being used to enrich filthy capitalist pigs.  Either way, Halvorssen’s letter is a welcome reality check.

Just so long as they don’t start selling Obama T-shirts.

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