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…Americans want health care reform because we want affordable health care. We don’t need subsidies or a public option. We don’t need a nationalized health care industry. We need to reduce health care costs. But the Senate Finance plan will dramatically increase those costs, all the while ignoring common sense cost-saving measures like tort reform. Though a Congressional Budget Office report confirmed that reforming medical malpractice and liability laws could save as much as $54 billion over the next ten years, tort reform is nowhere to be found in the Senate Finance bill. 
Here’s a novel idea. Instead of working contrary to the free market, let’s embrace the free market. Instead of going to war with certain private sector companies, let’s embrace real private-sector competition and allow consumers to purchase plans across state lines. Instead of taxing the so-called “Cadillac” plans that people get through their employers, let’s give individuals who purchase their own health care the same tax benefits we currently give employer-provided health care recipients. Instead of crippling Medicare, let’s reform it by providing recipients with vouchers so that they can purchase their own coverage…
More at the link.
The President’s proposed overhaul of the financial system ignores two key contributors to the crisis last fall. Fannie, Freddie Were at Center of Financial Crisis But Are Not Included in Obama’s New Financial Regulations
…Testifying before the Senate Banking Committee on Thursday, Treasury Secretary Tim Geithner said that the administration’s new regulations were only meant to address the most fundamental issues of the recession.
“We considered a full range of options and decided that now is the time to pursue the essential reforms,” Geithner said. “Those that address the core causes of the current crisis, and that will help to prevent or contain future crises.”
Those “essential reforms” include the establishment of a new Financial Oversight Council to coordinate between banking regulators and watch for systemic risk; new powers for the Federal Reserve to supervise all systemically important firms; a new National Bank Supervisor to oversee all federally chartered banks; and new powers to allow the federal government to wind down any failing financial institution…
Apparently Fannie and Freddie are just annoying distractions. A strange position for the White House to take, when you consider this:
The absence of either Fannie or Freddie is notable, because the two companies once owned or controlled nearly $6 trillion worth of home and commercial mortgages, nearly half of the total U.S. mortgage market – and both companies were pioneers of the now infamous sub-prime mortgages that caused the mortgage market to implode late last year.
During Geithner’s Senate testimony, he admitted that both Fannie and Freddie played a central role in the financial crisis, telling Sen. David Vitter (R-La.) that the two government-sponsored enterprises (GSE) were a “core part” of the country’s financial woes.
“Absolutely,” Geithner said. “Fannie and Freddie were a core part of what went wrong in our system.”
Don’t worry, though. Mr. Geithner plans to free up some time to deal with the duo, sometime:
Geithner explained that the administration did not have the time to come up with coherent regulations regarding Fannie and Freddie because of its other legislative priorities.
“We did not believe that we could have, in this time frame, lay out a sensible set of reforms to guide and determine what their future will be,” said Geithner. “We didn’t think it was an essential thing to do just now, but we do believe it is an essential thing to do.”
The delay is because he hasn’t yet come up with an endgame:
“Our challenge with Fannie and Freddie, and this is true about the government’s role in the housing market more generally, it’s more a challenge for exiting, what the future should be,” said Geithner.
“We have to fundamentally rethink what the appropriate role of the government is in the future [because] we did not get that right [in the past],” said Geithner. “It’s more about the questions we face about how the government gets out of and dials back and reverses these extraordinary actions we’ve been forced to undertake.”
I think Mr. Geithner and President Obama know exactly what role they want the Federal government to play in the housing market. They want more control, not an exit strategy, and the free market poses a fundamental problem for that. Why else did their reforms focus on increasing Federal control of the private sector?
It appears there are still a few free market advocates in Washington. From Human Events, Breaking Down Government Motors
…Thankfully, freedom still has a voice in Congress. Sen. Mike Johanns (R-Neb.) introduced legislation that would require Congressional approval before the government takes ownership of a private enterprise. This bill would allow Congress to stop the current shift away from free-market principles.
Johanns is not the only free-marketer. Sen. Lamar Alexander (R-Tenn.) has introduced legislation to require the federal government to distribute its ownership shares in General Motors and Chrysler to taxpayers when those companies emerge from bankruptcy proceedings. Alexander argues, “instead of the Treasury owning 60 percent of shares in the new GM and 8 percent of Chrysler, you would own them, if you were one of about 120 million individuals who paid taxes on April 15. This is the fastest way to get the stock out of the hands of Washington and back into the hands of the American people in the marketplace where it belongs.”
Sen. John Thune (R-S.D.) also joined the fray last weekend, introducing legislation that would restore private ownership to companies that have been effectively nationalized. The Thune proposal would make July 1, 2010 a new day of independence. By that date, the government would have to sell any ownership stake acquired over the past year-and-a-half. There’s no better way to fight the ever-expanding power of the federal government’s ownership in private enterprises than to legislate it out of existence…
Much more at the link.
We need more. The Tea Party movement needs to identify and support them.
Republican lawmakers have proposed what they describe as a revenue-neutral, free-market-based alternative to universal health care.
The bill is a response to the plan supported by President Barack Obama that would establish a separate government insurance program to compete with private insurance programs.
In contrast, the Republican proposal — called “The Patients Choice Act” — would redirect the $300 billion already spent on federal subsidies for employer-based insurance to annual tax credits of $5,700 for families and $2,300 for individuals to buy private insurance.
“There is no question we cut the uninsured in half,” Sen. Tom Coburn (R-Okla.) told CNSNews.com during a conference call Wednesday. “This is revenue neutral. Why would President Obama not support it? His plan costs another $1.5 trillion (over 10 years). Our bill forces insurance companies to have to compete.”
It gives Medicaid participants an option:
The legislation, if enacted, also has grants $5,000 for low-income earners to spend annually on health care. That would give Medicaid beneficiaries an option for another plan. Medicaid is the federal-state health insurance program for the poor.
Effectively, it unties health insurance from employment and gives people more choice. It would also help with Medicaid solvency. All without astronomical tax increases in one form or another, or suffocating bureaucratic control over private medical decisions. The Democrats will hate it.
For small businesses. From WSJ, Novel Approach to Health Plans Gains Traction
The programs typically involve collaboration between business owners, nonprofit groups and local hospitals, which offer enrollees a range of medical services at a reduced rate. The plans keep costs down partly by bypassing the extra costs that come with traditional insurance. That can be a big help for small-business employees who can’t afford traditional insurance. But for patients with costly chronic diseases or catastrophic illnesses, the coverage would likely be inadequate.
There are programs in Texas, Minnesota, Colorado and Arizona. A look at Galveston, Texas:
The UTMB plan in Galveston pays for 20 doctor visits a year and covers maternity care, visits to the emergency room, medical imaging such as CT scans and MRIs, and surgery. Enrollees can go only to UTMB and its staff doctors, and the coverage limits are lower than those of most employer-sponsored insurance plans: $1,200 per year for drugs, for instance, and a lifetime cap of $250,000. Family members aren’t covered.
These types of plans are called 3-Share, because employers and workers who participate each pay a third of the cost and the nonprofit groups find other sources of funds for the balance. The nonprofits generally look to government, foundations and hospitals as possible sources of money.
This kind of thing wouldn’t suit everyone, but why should it? Free markets aren’t about one-size-fits-all solutions. As always, it’s about the individual. This is a good idea and I hope it spreads.
By a Brit. In an article about the G20 conference this week, Janet Daley speaks a few home truths to the power of the mob: G20: If capitalism is ‘overthrown’, we’ll lose our political freedom
Some of the demonstrators in this week’s G20 protest jamboree are demanding the “overthrow” of capitalism. Well, there are lots of things than can be done to “capitalism” – it can be undermined, suppressed, sabotaged, even outlawed – but it cannot be “overthrown” because in itself, it has no power.
It is the very opposite, in fact, of a tyranny. It is simply the conglomeration of all the transactions made between individual and corporate players in an open market. Some people may gain power through those transactions but that power is transient and contingent on their own financial success: they are not installed in immutable positions from which they can be forcibly removed in a coup d’etat.
The question we are wrestling with now – and which the G20 will certainly fail to resolve – is how much the bodies which actually do have power should undermine, suppress, sabotage or even outlaw the practice of capitalist exchange.
Getting to the real issue:
When we make the case for capitalism, we are defending the political principle of freedom, not arguing for one kind of rigid economic organisation over another. The debate is being hopelessly muddied by those late converts to free enterprise – politicians like Mr Brown who believe that markets should only survive if they can be made to serve Left-wing purposes.
So the idea that the arguments which will dominate the summit are purely economic is quite wrong: this is about politics. The fundamental disagreement between the United States and Europe amounts to nothing less than the question of whether the great 200 year old experiment in national democracy – government of the people, by the people, and for the people – will survive.
Read the rest of this excellent article at the link.
…to spite your face appears to be the Fed’s modus operandi in the AIG bonus fiasco. Regarding the Administration’s and Congress’s screeching about blocking those payments, The Foundry notes:
Returning to the banking crisis, the White House’s willingness to abrogate contracts outside of lawful bankruptcy proceedings is guaranteed to undermine their plans for stabilizing the banking sector. The Washington Post reports: “The attack by lawmakers on AIG pay has provoked renewed complaints from some financial company executives that federal involvement in business decisions is making it difficult for struggling firms to return to profitability. … A senior executive at one of the nation’s largest banks said he had heard from several hedge funds that they would not partner with the government for fear that lawmakers would impose retroactive conditions on their participation, such as limits on compensation or disclosure requirements.”
This past Sunday, National Economic Council director Lawrence Summers told ABC News: “We are a country of law. There are contracts. The government cannot just abrogate contracts.” This is exactly why government participation in the market, and all the political considerations it necessarily entails, undermines the rule of law which is the foundation of our success as a free market nation. As one executive at a private-equity firm told the Washington Post:
“Why do you think Hong Kong is a better place to do business than Shanghai? Because of the certainty of the contracts. Once the uncertainty factor goes up, the less interested you are in doing business because it becomes a more risky proposition.”
They should have gone with “Haste makes waste.”
Contrary to politicians’ and legacy media’s hogwash, the American market was not free prior to the economic meltdown. From Voices For Reason, What Free Market?
The upcoming Spring issue of The Objective Standard includes an article by ARC’s Yaron Brook and Don Watkins challenging the notion that America had a free market economy before the recent crisis. In “America’s Unfree Market,” they argue that since World War I the U.S. economy has been increasingly saddled with–and damaged by–the anti-free market elements of taxes and government controls.
As noted in the article, with the latest federal budget surpassing $3 trillion and tens of thousands of regulations already on the books, people’s belief that America has a free market is only possible because of a gross misconception of what a free market actually is.
The article is only available to subscribers but there’s a link to a long excerpt at the site.