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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Maybe It’s Not Paranoia If We’re All Paranoid: A Review of Jesse Walker’s New Book

History, Non-Fiction Reviews, Pop Culture, Reviews
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9780062135551_custom-b59aef367c02e28f5b19c4597390912eb7cbf621-s6-c30The United States of Paranoia: A Conspiracy Theory, by Jesse Walker, HarperCollins, 448 pages, $25.99

Circa 2009, in a fit of 1990s nostalgia that should make BuzzFeed proud — and motivated in part by a clunky Department of Homeland Security paper — some of the left decided that incidents like the murder of abortion provider George Tiller, the shooting death of a guard at the Holocaust Museum in Washington, DC, and the lingering rumor that Obama was a Muslim from Kenya meant that the right couldn’t handle a black, Democrat president without losing their Goddamned racist, fascist, conspiratorial minds. It wasn’t true, but it made great headlines and cable news concern-trolling. In a while the left cooled off a bit. (They didn’t even blame any right-wing pundits for the schooting at Sandy Hook Elementary school!) But the notion of a paranoid (loosely-defined) right remains (and will forever, if the Southern Poverty Law Center has anything to say about it).

Talking about paranoia or conspiracies is not as simple as Birthers, Truthers, or even the fair-is-fair point that the left has big fears, too. (Or that paranoia about the paranoid may count as paranoia!) There are a lot more baseless or exaggerated fears dwelling deep in a lot more humans than any partisan could ever admit. And, writes Reason magazine books editor Jesse Walker in his new book, that fear has been with us since before America was the United States.

To make our long history of hiding and screaming in terror easier to filter, Walker divides his types of conspiracy theories into five groups: the Enemy Outside (say, rogue Indians and scheming Catholics), the Enemy Within (Commies, Satanists, anyone quietly scheming), the Enemy Below (slave rebellions, populist uprisings), the Enemy Above (the state! And corporations, and Illuminati, and Bilderbergs, anyone powerful who secretly runs everything and may even be inciting the faceless mobs in their own supposedly organic outrages), and the Benevolent Conspiracy (angels, friendly aliens, and benevolent puppetmasters and societies). And there are scads of examples of each, surprising numbers for a book that isn’t about any of those one things. Indeed, there is so much of interest in United States of Paranoia that its biggest problem might just be a reader’s desire to stop a minute and talk even more about this or that specific thing. Any chapter could have made a whole, adsorbing book in itself.

Because while strolling through American history, Walker manages to mention almost every seemingly random, fascinating bit of human endeavor possible, including, but not limited to: the myth of the superchief Indian, the meaning of Invasion of the Body Snatchers, the multilayered interpretations of Rambo, aliens, Satan´s influence on Your Children and Women, plenty of communists, fears of commie and gay conspiracies, real conspiracies like COINTELPRO, and a bracing defense of (most) militias. Indeed, one of Walker’s most fascinating chapters is the one where he explores the New World Order/Illuminati fears that bridged ´90s militia and black nationalist movements.

The simplest, most convenient libertarian takeaway in these pages is that a lot more people are paranoid than your average loony — say, the cheap caricature of a libertarian writing anti-government manifestos, then piloting a plane into an IRS building (or something). We´re not alone, fellow residents of government watch lists! That´s the thing about United States of Paranoia, anyone, libertarian or not, could read it in two ways: optimism that the oft-cackled critique of ¨you’re paranoid!¨ can be directed at at least every other human; pessimism, or actual alarm, that this many people over this many years have let their fears turn into sometimes-real monsters that kill or at least ruin lives.

But instead of worrying about that, maybe just follow Walker´s lead, and enjoy the journey — the often-creative myth-making and the psychology of paranoid tales and what they say about us. Walker´s a big fan of the late Robert Anton Wilson, and another of his best chapters discusses Wilson and the Discordians and other folks who got into conspiracy theories for their weirdness, not for any Grand Explanation of All Things. (Paranoia as art! Finally an understanding of my inability to be be outraged over Alex Jones, not matter how horrible he is for libertarianism!)

Walker´s writing style is brainy, but off-kilter and  quietly funny, like the man himself. Any creeping libertarian propaganda is in short, subtle supply. There’s nothing much here to turn off the readers who might disagree with Walker’s politics. The story he tells is captivating, human, bizarre, and endlessly surprising, in short, accessible to all but  the most ardent Southern Poverty Law Center employee or sincere user of the word “sheeple.”

The entire book filled me with a strange fondness for America, simply because of the strange creativity of many of these myths. Yes, paranoia run amok can cause real casualties (ask Giles Cory, or parents in Kern County, California). But seeing patterns, conspiracies, and cabals is normal; as is building up our enemies, be they small, or entirely imaginary, into something vast and all-powerful and terrifying. This is who we are, we humans. And Walker’s exploration of the normalcy of this fear should make us all a little less paranoid.

But it won’t.

Maybe It’s Not Paranoia If We’re All Paranoid: A Review of Jesse Walker’s New Book Read Post »

The Golden Age at Twilight

Corporatism, History, Pop Culture
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Rod SerlingWhen I was in 5th grade, the teacher, Mr. Kelly, asked the class if anyone could tell him the definition of the word twilight. I raised my hand, excited to know the answer for once: “A dimension not only of sight and sound but of mind — a journey into a wondrous land whose boundaries are that of imagination…”

“You idiot!” interrupted Mr. Kelly. (Does the setting of New York City in the 1970s explain at all why the teacher talked to his pupils that way?) “That’s the Twilight Zone! — Twilight is the period between sunset and darkness…”

Oh, I thought. So that’s why the show is called the Twilight Zone. It’s an in-between thing.

I wonder if there are kids today who will some day tell a similar story — probably with a less ill-mannered teacher — where they answer the vocabulary question by stating that “twilight” is when high-school vampires are in love with teenage mortals.

When I was a kid, The Twilight Zone was the smartest television show I watched. And I watched a lot of TV. It had already been off the air for a decade, but so had most of my shows. I grew up in the 1970s watching the TV of the 1950s and ’60s on a portable black-and-white television set with antennas made of coat hangers and tinfoil.

I loved the plot twists, and I didn’t mind all the moralizing. Most of the television I watched was preachy — and kids are used to being preached at from all directions, not just their TV viewing — but unlike all the other shows I watched, The Twilight Zone dealt with mind-bending ideas, and its plots weren’t predictable, at least not to me. Each episode ended with a revelation, and I enjoyed trying to guess what it would be, though I seldom guessed right.

The critics had loved it from the beginning — well before the show became popular with viewers — and later critics ranked it as a high point in television history:

In 1997, the episodes “To Serve Man” and “It’s a Good Life” were respectively ranked at 11 and 31 on TV Guide‘s 100 Greatest Episodes of All Time.…

In 2002, The Twilight Zone was ranked No. 26 on TV Guide‘s 50 Greatest TV Shows of All Time. In 2013, the Writers Guild of America ranked it as the third best written TV series ever. (Wikipedia)

The show’s creator, executive producer, and head writer, Rod Serling was one of the star television writers from the first “Golden Age of Television.”

His successful teleplays included Patterns (for Kraft Television Theater) and Requiem for a Heavyweight (for Playhouse 90), but constant changes and edits made by the networks and sponsors frustrated Serling. In Requiem for a Heavyweight, the line “Got a match?” had to be struck because the sponsor sold lighters; other programs had similar striking of words that might remind viewers of competitors to the sponsor, including one case in which the sponsor, Ford Motor Company, had the Chrysler Building removed from a picture of the New York City skyline. (Wikipedia, “The Twilight Zone”)

In the Golden Age of Television, sponsors not only attached their names to the TV shows they sponsored — Kraft Television Theater, Philco TV Playhouse, Goodyear TV Playhouse, The Alcoa Hour, The Voice of Firestone, The US Steel Hour — they developed shows, produced them, and paid the networks to put them on the air.

Television's Second Golden AgeRobert J. Thompson, a communications professor at Syracuse University, writes,

This arrangement led to some legendary stories of sponsor interference. Alcoa, manufacturers of aluminum, for example, would not let Reginald Rose set a tragic event in his episode of The Alcoa Hour in a trailer park, where most of the homes are made of aluminum. The Mars company, which sponsored Circus Boy, made it known to those making the show that they didn’t appreciate references in the program to ice cream, cookies, or other treats that competed with Mars’s candy products for the sweet tooth of America’s youth.

And for those of you who’ve read my earlier post “Who destroyed the first golden age of television?” take note of this one:

In “Judgment at Nuremberg,” an episode of Playhouse 90, about the trials of Nazi war criminals, a reference to “gas chambers” was deleted by the sponsor, the American Gas Association. (Television’s Second Gold Age)

Two years before Serling created The Twilight Zone, he wrote a long introduction to a paperback release of his historic teleplay Patterns. (“Many of the scripts for these [1950s TV] plays were collected and sold in book form,” writes Professor Thompson, “a distinction prime-time programs would not enjoy again for many years.”)

In his introduction, Serling reviews the history of television drama and his career in the medium, gives advice to young writers, and voices his regret about the medium’s dependence on commercial interruptions and busybody sponsors.

RodSerlingPatternsFor good or for bad, the television play must ride piggy-back on the commercial product. It serves primarily as the sugar to sweeten the usually unpalatable sales pitch. It’s the excuse to wangle and hold an audience.

Serling is clearly trying for a measured tone in that introduction. In Submitted for Your Approval, a documentary about his career released 20 years after his death, we get a more candid opinion:

How can you put out a meaningful drama when every fifteen minutes proceedings are interrupted by twelve dancing rabbits with toilet paper?

Still, Serling understood that his career depended on the dancing rabbits:

A sponsor invests heavily in television as an organ of dissemination. That organ would wither away without his capital and without his support. In many ways he hinders its development and its refinement, but by his presence he guarantees its survival. (Patterns, introduction)

In addition to specific cuts and changes, the TV sponsors of the 1950s had informal rules limiting content. While Serling was already known as a writer of television drama, The Twilight Zone made him famous ever after for fantasy and science fiction. In his 1957 introduction to Patterns, you can already see him being pushed in that direction as a reaction to the sponsors’ fiats:

One of the edicts that comes down from the Mount Sinai of Advertisers Row is that at no time in a political drama must a speech or character be equated with an existing political party or current political problems.

Serling’s 1956 teleplay about the US Senate was gutted. Several million television viewers tuned in to his political drama “The Arena,” Serling writes, and

were treated to an incredible display on the floor of the United States Senate of groups of Senators shouting, gesticulating and talking in hieroglyphics about make-believe issues, using invented terminology, in a kind of prolonged, unbelievable double-talk.

“In retrospect,” Serling mused,

I probably would have had a much more adult play had I made it science fiction, put it in the year 2057, and peopled the Senate with robots. This would probably have been more reasonable and no less dramatically incisive.

Serling insists that he did not make trouble: “I’m considered to be a cooperative writer — even now. I don’t get my back up at requests for rewrites.” But he was known in the industry as the “angry young man of Hollywood,” and when he died of a heart attack at age 50, many newspapers “mentioned that he had been a heavy smoker for years and was angry and stressed most of his life” (Wikipedia).

But while he fought television executives and sponsors over what he unfortunately called “censorship” (see my post “censorship schmensorship” on why this label is misleading, at best), he fell short, in the 1950s at least, of proposing government intervention — or any other specific solution:

I don’t really believe there exists a “good” form of commercial. There are some that are less distasteful than others, but at best they’re intrusive.… I make reference to this by way of pointing out a basic weakness of the medium. I do not presume to suggest any antidotes or alternatives. At the moment none seems possible. (Patterns, introduction)

Sadly, by the ’60s, he was willing to call on the state. According to a 1964 article about Rod Serling and “TV censorship,” we learn that Serling

proposed that the Federal Communications Commission “pass muster” in some fashion on the quality of advertising in television. The FCC has never been a “strong arm of the government” because it was afraid of being accused of censorship, he said. (“Serling Rips TV Censorship,” Binghamton Press & Sun-Bulletin, May 1, 1964)

Note the irony of his fighting the “censorship” of private editorial policies within the networks, then dismissing concerns about the real-deal coercive variety from the central government.

There’s another irony to Serling’s shift. You need to note the dates and know a little television history to catch it.

The television industry in which Rod Serling had established his name was dominated by sponsors — this was precisely Serling’s problem with it:

No dramatic art form should be dictated and controlled by men whose training and instincts are cut of an entirely different cloth. The fact remains that these gentlemen sell consumer goods, not an art form. (Submitted for Your Approval)

And yet the era of Serling’s ascendancy is now considered the Golden Age of Television and the TV drama of the era is recognized as an art form at its peak (until the present new golden age of television drama came to surpass it). According to television producer Sherwood Schwartz, the success of that earlier era resulted directly from its domination by the sponsors:

[T]he networks were conduits and they had no control of programming. Sponsors had more power, and the creative people who created the shows had more authority.

Professor Thompson indicates other benefits of the 1950s arrangement:

Television's Greatest Year: 1954[S]ingle sponsorship also had advantages. R.D. Heldenfels, TV critic and author of Television’s Greatest Year: 1954, points out that “Unlike the current system, where a terribly low-rated show is pulled after one or two telecasts, a single sponsor willing to wait for good numbers — or to settle for lower numbers because the show increased the sponsor’s prestige — could keep a show going.” Since networks made money as long as the show remained sponsored, the only reason for them to cancel a sponsored series was if the ratings were so low that they threatened to reduce the size of the potential audience for the next show on the schedule. Indeed, many companies were more concerned with prestige than they were with numbers. If not for prestige, why would a company like US Steel have sponsored an anthology? There were no raw US Steel products that a mass audience could buy over the counter and most viewers had no idea where the steel in their automobiles came from. It was even possible that a show would continue to be sponsored based on the tastes of a single executive or company owner. The classical music on The Voice of Firestone played for five years on NBC and another five on ABC to comparatively small audiences because the Firestone family was more concerned with attaching their name to a cultural show than they were with ratings.

Yet here was Serling in 1964, calling for a stronger hand from the FCC and pooh-poohing the idea that such intervention would constitute censorship — this just after the three-year reign of FCC chair and “culture czar” Newton Minow, who

gave networks authority and placed the power of programming in the hands of three network heads, who, for a long time, controlled everything coming into your living room. They eventually became the de facto producers of all prime-time programs by having creative control over writing, casting, and directing. (quoted by Russell Johnson, aka the “Professor,” Here on Gilligan’s Island)

In the famous “vast wasteland” speech before the National Association of Broadcasters in 1961, Minow told the television industry, “You must provide a wider range of choices, more diversity, more alternatives.”

“Yet,” according to University of Virginia professor Paul Cantor,

Minow’s speech resulted in centralizing power in the television industry and thus actually reducing the range of choices in programs.… [H]is words contained clear threats that if the television industry did not voluntarily do what he wanted, the FCC would make sure that it did. (Paul A. Cantor, “The Road to Cultural Serfdom: America’s First Television Czar” in Back on the Road to Serfdom: The Resurgence of Statism, edited by Thomas E. Woods, Jr.)

Rod Serling, the angry young man of Hollywood, clearly preferred the rule of the FCC to the rule of the American sponsors, and in 1964 — after three years under Newton Minow had radically changed the television landscape, and JFK-appointed FCC chair E. William Henry was still “fully committed to Minow’s agenda” (Thompson) — Serling all but advocated an even stronger hand from the federal government to limit commercial interruptions.

Is it possible that the sponsors were requiring ever more commercials in response to their dwindling power in the production end? After all, you don’t have to push Kraft-brand cheese slices as ardently when the anthology showing Rod Serling’s famous “Patterns” is called The Kraft Television Theater.

If that’s right, then Rod Serling is yet another example of the intervention spiral that Ludwig von Mises described: first you call for government intervention, then you fail to see that the intervention created the new problems you dislike, so you call for further intervention, and the cycle repeats.

So why wasn’t Serling afraid of implicit censorship from the FCC?

One unfortunate possibility is that Rod Serling was less vigilant about the FCC because Newton Minow’s agenda was better aligned with Serling’s own politics. Serling’s teleplays were antiwar well before antiwar sentiment took over a later generation. His stories also focused on questions of racial prejudice and sexual equality at a time when the sponsors considered the topics divisive and controversial. Recall that one of the edicts from “Advertisers Row” was that “at no time in a political drama must a speech or character be equated with an existing political party or current political problems.”

But in the early 1960s, the edict from Washington DC reversed the mandate.

Newton Minow was an appointee of the Kennedy administration. “His chief ‘qualification’ for the FCC job,” according to Paul Cantor, “was the fact that he was a personal friend of the president’s brother Robert Kennedy.”

Lacking any grasp of aesthetic criteria, Minow had to employ political criteria in his evaluation of television, and the industry responded accordingly.… [T]he changes in television content in the 1960s chiefly followed a political agenda — greater representation of minorities on shows, especially African-Americans; more dramas devoted to controversial political issues, displaying a deepened social conscience; in particular a number of shows dealing with the issue of civil rights, which not coincidentally was being promoted at the same time by the Kennedy and Johnson administrations.… [T]elevision in the 1960s increasingly fell in line with the program of the Democratic Party. This is exactly what one might have predicted under the leadership of an activist FCC chairman appointed by a Democratic president. (Cantor)

If Rod Serling wanted to push the Democrats’ agenda, then pressure from the federal government for television networks to do exactly that may have felt less like oppression and more like freedom.

Serling may have welcomed the new era of the American culture czar. Minow certainly recognized Serling as a comrade in the crusade. In his speech to broadcasters, Minow had called television a “vast wasteland,” but he listed a handful of exceptions by name. Serling’s Twilight Zone was one of them.

The preachy tone I now hear in the show was a sign of the times. It felt familiar to me because I had grown up on 1960s television. I believe in tolerance and diversity largely because TV taught me to believe in tolerance and diversity. But over time, I came to believe that the tolerance of left-liberalism was a shallow tolerance, a tolerance only for certain forms of diversity — those that aren’t in conflict with the rest of the left-liberal agenda. That agenda was about more than cosmopolitan open-mindedness and acceptance of ethnic and cultural differences; it was about greater centralization of power, the need for coercive intervention, trust in certain elites, and a distrust of local values and local authority.

Serling may have seen a greater number of heroic, middle-class blacks and strong, smart women on television and believed that it was evidence that the medium was advancing. But did he also notice that the stories took fewer and fewer risks? Did he notice that the chorus of social consciousness could sing only one note?

He bridled against the sponsors’ mandate not to offend anyone and bemoaned the television writers’ practice of “pre-censoring,” by which he meant anticipating sponsor reaction and thereby avoiding any risks. And he was right that creativity requires risk-taking. In recent decades we’ve seen the cable-TV drama raised to the level of art precisely because commercial-free cable networks can afford to take chances that commercially supported broadcast networks just can’t.

But the strong arm of Kennedy liberalism, in the form of an activist FCC, drove risk-taking off the air and replaced it with homogeneity and blandness under the guidance of a fearful cartel of network heads who were willing to sing the administration’s preferred lyrics so that they could continue to sell soap. Rod Serling may have played a starring role in the golden age of television drama, but his agenda brought that age to an end.

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