Friday, March 24, 2017

Common Ground!

Why do people claim that Congressional Democrats and Republicans can't work together?  The Nancy Pelosi Gang and the House Freedom Caucus agreed not to support AHCA, and Paul Ryan withdrew it (thank heavens).  Cooperation at its best!

I will have comments on health care reform very soon.

Friday, March 17, 2017

Steele auf Deutsch

Was bedeutet der Sieg von Donald Trump hinsichtlich Energie? 

A quick note: my comment for Heartland on what Donald Trump's electoral victory might mean for energy policy was picked up and translated by a German website devoted to climate and energy.  I just came across this.  All readers of Unforeseen Contingencies are strongly urged to go to the page immediately and read.  What better time than now to work on one's German?

Thursday, March 09, 2017

Heartland press release: Steele's comments on AHCA

I promised I would post my comments that were included in the Heartland Institute press release on the House Republicans' AHCA.  Here it is, and link to whole press release:

“I’m skeptical of the House Republican plan. It seems to be a modification of the ACA, keeping some of the Obamacare features and replacing the subsidies with tax credits. But the tax credits seem less than the likely premium increases, at least for older purchasers of insurance. It replaces the penalty for being uninsured with a penalty surcharge for the uninsured who eventually take up insurance. This seems like an incentive not to purchase insurance until one needs health care. I’m not sure why this plan would be more sustainable than the ACA.

“In my view, the real problem with all the plans cooked up by Washington D.C. are that they focus almost entirely on the demand side, on how to help people pay for health care. They also impose complex schemes, rather than market-based approaches. While the health insurance market is a mess that needs fixing, the real gains that might be made are on the supply side. These insurance fixes – the ACA and the Republican proposal – do nothing for the supply of health care. At best what they can do is increase demand for health care services while doing little to promote innovation and entrepreneurship in health care, pushing prices up. The entire approach is wrong. What’s called for is a free market in health care.”

I am measured and polite and guarded in the above comments.  But come on.  The more I hear and read about this plan, the more outrageous it seems.  Here is a major problem: it creates an obvious incentive for adverse selection, which will destroy insurance markets.  Under the ACA (Obamacare), the exchanges were to provide insurance to people without coverage.  Under the "pre-existing conditions" provision, no one can be refused insurance, and there's no limit to how much an insurance company might be compelled to pay out.  So, for example, if one asks to buy a policy costing $6,000 and has a health problem that will cost $100,000 to treat, the insurance company must sell it, at a guaranteed loss of $94,000.

Given this, no healthy person has any incentive to buy insurance, only sick people enter the pool, and insurance prices begin soaring to the heavens.  To avoid this, Obamacare mandated insurance; everyone was required to buy it.  The mandate involved a small fine, errr, "tax," that proved to be ineffective.  The Obamacare pools consist of sick people and are collapsing as premiums skyrocket.

The Republican solution is to eliminate the mandate.

Good lord!  This reduces the incentive for healthy people to buy insurance.  This proposal will accelerate adverse selection.  It will accelerate the skyrocketing of premiums.  It is not sustainable.  It will lead to increasing premiums,higher deductibles, and shrinking networks for everyone.

There's plenty more wrong with it, but this is enough to make AHCA worse than the dreadful Obamacare. It accelerates the wrecking of health insurance and does nothing at all to move us toward a free market, and nothing at all to expand the supply of healthcare.  GOP needs to retract this dishonest and destructive plan and repeal Obamacare, not tweak it.  They need to get a new Speaker while they are at it.

Tuesday, March 07, 2017

Republican Congress lies

The House Republicans have revealed their proposal for "repealing the ACA, "Obamacare."  It is not a repeal at all, but rather a tweaking of the basic framework.  So far as I can tell, the main features are these: it replaces the subsidies with tax credits, which are effectively the same thing.  It keeps the "pre-existing conditions" provision and replaces the mandate with a premium surcharge for those who go without insurance but then buy it later.  This should worsen, not reduce, adverse selection, in which the sick have incentive to buy insurance and the healthy don't.  It retains the comprehensive coverage of everything from pregnancy in men to prostate problems in women, and it retains the infinite dollar coverage provision.  It has a number of other bad features, but most importantly it is another convoluted bureaucratic monstrosity that does nothing to advance us to a free market, nor to good incentives for consumers, health care providers, and insurers.

This strikes me as an utterly fraudulent "plan."  If ACA doesn't work (and it doesn't, it's collapsing) why should this work better?  I suspect that when CBO scores it, it will look very bad.  Robert Laszewski calls it "mind-boggling" and explains why it won't work.  He also links to Sarah Kliff's clear and non-partisan summary of the proposal on Vox.  And here's something a little more partisan, Daniel Horowitz' scathing analysis on Conservative Review.  All agree, this is a bad proposal.

As I wrote to a colleague, this is just what I was afraid of.  I'd repeatedly said I didn't believe the Republicans wanted to get rid of Obamacare, that they'd always have an excuse..."we can't do anything until we control the Senate,"... "yes, we now have the Senate but can't do anything until we have the presidency".  Now it's, "yes, we can't do anything."

This monstrosity is possibly worse than the current ACA; it is probably less financially sound (yikes!) and might do even more to encourage adverse selection.  I hope this asinine proposal doesn't pass, but if it does the wrecking of private health insurance seems assured.

This is just what I expected of the GOP leadership, of course.  I remember all these GOP *^@$^#*(! excoriating Ted Cruz for trying to defund Obamacare..."terrible strategy, Ted, you must wait until we have both houses and the presidency.  You are a traitor who will sabotage our clever PRACTICAL strategy for repealing Obamacare."

There were also the phony repeal votes, which Cruz characterized this way: "We'll have a vote on repealing Obamacare," he said. "The Republicans will all vote yes; the Democrats will all vote no. It will be at a 60-vote threshold. It will fail. It will be an exercise in meaningless political theater."

And now that Republicans have both houses and the presidency, we see that, as Cruz warned us and Horowitz now puts it, "they lied all along."

I made a few comments on all this for a Heartland Institute release.  Once they are up I will link to them or post here.

Thursday, March 02, 2017

Murray Rothbard's Birthday!

His 91st.  And as part of the celebration, I did a podcast for Heartland Institute with Sterling Burnett, and had a piece in American Spectator.  Both have the stamp of approval of the entire staff of Unforeseen Contingencies and are highly recommended.

Happy Rothbard's Birthday to all of "our" readers!
P.S. (Note: modified from original to be more polite.  I did not like my previous tone.  I've also added some additional thoughts.)

The comments section on the American Spectator piece attracted the anarcho-capitalists who treat the ideas as a religion, as expected.  I find this somewhat entertaining because it is so predictable, but it's also instructive.  In my piece I pointed out, correctly, that the primary argument in economics for a state is the public goods argument and that Rothbard didn't refute it but sidestepped it.  I did not say the public goods argument is correct (I think it isn't).  But one of the earliest commenters labelled my statement "false" and began making a claim that the free market can solve free rider problems via "dominant assurance contracts," (DAC) a hypothetical non-existent kind of contract.

The DAC is an interesting idea.  It's almost certainly wrong to say it solves the public goods problem. It does not eliminate the free rider problem, although it might reduce it should it ever exist somewhere besides an academic blackboard (it's a hypothetical), but that's irrelevant to my point.  This idea is not Rothbard's theory, and Rothbard fails to seriously address the public goods problem -- that's my point.

But even better, I point out it's silly when Rothbard claims that private defense agencies would never behave in predatory fashion or fight with each other.  (I'm more polite than this in the piece, but it really is a silly point.)  I use Al Capone and the St. Valentine's Day massacre as one example, and Hitler invading Poland as another.  People with armed might who are in an anarchic situation will use it if they think the benefits outweigh the costs.  The same commenter objects to my argument because Al Capone's gang gained its wealth during guvamint Prohibition and Hitler was a politician.  I see... so the state made Al Capone commit murders, but in an anarchic society he and his gang would never even think of killing competitors?  This is not a rational argument.  I expected it and prepared.  When the commenter "explains" Hitler by saying he was a "politician," commenter falls into the trap I set: "There’s nothing special about whether we call an organization a “state” or not that changes the benefit-cost analyses of the leaders in these matters."

I included that line precisely because whenever one points to how people in anarchic relations actually behave, a standard anarcho-capitalist response is that the state currently exists so this can't be considered anything like the way people would behave in anarchic relations if there were no state -- people would behave entirely differently.  I.e. they simply repeat Rothbard's claim.  They add to the silliness of the argument by saying that certain people's behavior can't be counted, because they are statists, politicians, criminals, etc.  These "answers" make no sense as responses to logical arguments from critics.  They make more sense if one realizes they are affirmations of faith made in the face of nonbelief.

The anarcho-capitalism of most Rothbardians I've encountered is not political theory, it's religion.

Tuesday, February 28, 2017

Donald Trump's Speech

This was the best speech I have heard from an American president at least since Ronald Reagan.

It was long, and I won't go into detailed analysis, but I agreed with most of what Trump said, and I was pleased by the tone.  I have been waiting for 26 years to hear a President speak who wasn't leftist,  mealy-mouthed, or just plain disingenuous.  I thought this was great stuff.

The few MSM commentators I've heard seemed disoriented.  I suppose they wanted to pick it apart and attack Trump as outrageous, but that's hard to do with this.  Commentators also focused on Mrs. Owens as the emotional highlight, and I suppose it was, but what really struck me emotionally was Trump's earlier emphasis on education.  America's government education is a catastrophe, and arguably the worst threat to or nation, because ignorant people who can neither think nor learn can't defend freedom, and will lose it.  Trump's call for freedom for people to choose among all kinds of education had me cheering.  Freedom!  That's exactly what people both need and deserve.  I cheered.
Elizabeth Warren, Al Franken, Nancy Pelosi, and similar scoundrels seemed particularly incensed by this.  Freedom for citizens to choose their own way is so far from what they believe that they could only glare in hatred...which pretty much sums up the platform of the Democrat party these days, the party of hate.

I also appreciated the presence of the Jamiel Shaw, the gentleman whose son was murdered by illegal alien gang members.  I suppose in the next few days Alex Nowrasteh, the Bier brothers,  Ben Powell, Bryan Caplan, and Alex Tabarrok will try to explain why it's actually a good thing that Shaw's murderer, or the twice deported felon who murdered the husbands of Jessica Davis and Susan Oliver weren't prevented from entering the country.  But no sensible or decent person will buy such vicious madness.

And I especially loved it when Trump made this point: "My job is not to represent the world, it's to represent the United States of America."  Until recently, I can't imagine this would have made sense as a statement; it would have been as non-controversial as saying there are two sexes.  But in these Crazy Years its now dogma that sex and "gender" are fluid and infinite, and the idea that the President is supposed to be concerned with serving Americans, rather than foreigners or the "international community" is no doubt considered Nationalist, Fascist, Racist, and Authoritarian.  Well, that's ridiculous.

Trump's comments on international trade were interesting.  I am an advocate of free trade.  But I noticed what Trump explicitly condemned in trade is not trade itself, but other countries applying high tariffs in cases where we have none.  What he called for, I think, was pressure to make other countries drop their trade barriers.  Adam Smith himself suggested this, and the principle of WTO enforcement is built on such retaliatory tariffs.  If so, it's not an inherently objectionable idea.

There was much more, but in short, Trump laid out good principles and, by and large, a good agenda.  I hope he sticks to it, and I hope Congress gets to work.

Sunday, February 12, 2017

“It’s not immoral for one human to own another human" ... "Consent isn’t necessary for lawful sex"

The title of this post comes from a recent lecture given by a Muslim professor from Georgetown University, and refer to slavery and rape in Islam.

A fair share of the libertarian intelligentsia seems to share the left's outrage over the temporary moratorium on immigration from seven threat countries.  From Cato, Alex Nowrasteh and David Bier are both on their usual jihads against any immigration controls whatsoever.  FEE has recently had pieces by two economists I respect, Sandy Ikeda and Don Boudreaux, criticizing arguments for restricting immigration.

There's a lot of this material, and it is tedious spending time evaluating arguments point-by-point, so I won't do it.  Suffice it to say there is no sensible argument for restricting productive workers.  But most of the stuff coming out now doesn't deal with this at all, a great deal of it denies there is any problem at all with Muslim immigration, and a fair amount suggests that the threat of terror is way overblown.  Much of it denies we should be concerned about cultural change, and treats us as bigots if we are.

This is madness.

Here's a very "nice" (i.e. horrific) example of why we should be concerned about the cultural attitudes that Islam promotes.  Professor Jonathan A.C. Brown of Georgetown University recently gave an address in which he repeatedly defended both slavery and rape as moral, if conducted in the Islamic way.  You see, worrying about individual autonomy and consent is merely a Western fetish, and once we shed it and understand that Mohammed practiced both of these things, they certainly are moral, since by definition he was the most moral man.

This not some nutty outlier position.  Linda Sarsour, one of the main organizers of the "women's march," has been promoting sharia.  The more I read about her, the clearer it is she is working for the Islamization of the United States. (Read all the way through the 2017 updates.)  Or consider Rep. Keith Ellison (D, MN), a radical Muslim and anti-Semite, and the choice for DNC Chair of Bernie Sanders, Elizabeth Warren, and Chuck Schumer.

It's so disconcerting to realize all the women at the "women's march" imagining themselves in solidarity with Sarsour, some donning hijabs to protest Trump's "ban."  They do realize that in Islam most abortion is banned, at least after four months, and that a male's consent is generally needed, right?  They do realize that Sarsour defends the treatment of women in Saudi Arabia, and claims it is better than here?  I think they are beyond reason -- it's really madness.  So too with Sanders and co.

At some point, one also must start to wonder if libertarians for completely unrestricted immigration are playing with full decks, or if maybe they really share with leftists a desire to see existing society overthrown at any cost.  Or perhaps some are simply so naive and uninformed on anything other than economics and libertarian philosophy that they are unaware of what they are actually advocating.  (I hope this is the case with Boudreaux and Ikeda; I am fairly sure it's not for Nowrasteh and Bier, since they claim to be immigration experts who study this stuff for a living.)

It's hard to know what to say, other than that this is madness.  Bringing in large numbers of Muslim immigrants from the most fundamentalist and violent parts of the Islamic world is a terrible idea.  They'll not assimilate (leftist dogma these days is that "assimilation" is an exclusivist and racist concept!), they will not become productive citizens, and most importantly they'll promote a foreign culture that is incompatible with liberty.  (See the three charts below from the Pew Research surveys on attitudes of Muslims around the world.

I hope libertarians return to their senses on this soon.

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