Health Care and Federalism

Legislators in some states are prepared to challenge the constitutionality of the requirement that individuals carry health insurance on federalism grounds.

Sick Days

If you're in my M/W classes (and showed up today) you know class was cancelled because somehow I caught a bug. That's my fault for giving so many quizzes, I know.

I'm not feeling any better so I will have to cancel my Thursday classes also. Here's the plan for next week:

For 2301, we will postpone the week 5 quiz (on Federalist #51) and take it with the week 6 the following Monday, October 5th.

For 2302, I'm going to cancel the quiz altogether. We will start on the executive branch this coming Monday or Tuesday.

Luck for you online students, none of this affects you. Remember that the first paper is due this Sunday.

The Nones

A current survey predicts that in 20 years, 25% of the population will claim to be disinterested in any religion. Here are predictions about the consequences for party competition:

1. Secular voters will become an increasingly important component of the Democratic base.

2. American politics will become more polarized.

3. Republicans will have to choose between becoming a more overtly religious party and reaching out more seriously to the growing secular middle.

4. If secular voters become more aggressively antireligious, the Democrats' newfound faithiness faces big challenges.

David Souter on the Constitution

If you have hour to kill, here's a great interview with the ex-Supreme Court Justice.

The GOP and the Grassroots

Still no clear leader for the party. From the Hill:

Two recent controversies that became high-profile Republican victories sprouted from the grass roots far from Washington, and only later were adopted by congressional Republicans.

Republicans forced and then won a House vote on de-funding the Association of Community Organizations for Reform Now (ACORN) on Friday. That followed the high-profile resignation of White House green-jobs czar Van Jones, who left amid Republican attacks.

The twin successes highlight the biggest difference between today’s GOP and that of a few years ago, when former President George W. Bush was giving marching orders. There is no longer one voice speaking for the whole party.

Who Reads Whom?

From an Insider's Poll in the National Journal: A list if the columnists most likely to be read by Democrats and Republicans ("the one's most likely to shape your opinion or world view")

Democrats:
- Thomas Friedman
- Paul Krugman
- E.J. Dionne
- David Brooks
- David Broder

Republicans
- Charles Krauthammer
- George Will
- David Brooks
- Karl Rove
- Thomas Friedman
- Peggy Noonan
- William Kristol

The two parties seem to live in different worlds.

The Party of the South?

Here's evidence that the Republican Party is primarily popular in the South.

The Right to Zip It

Here's a great piece about an unappreciated and neglected right. It adds to our discussion of Federalist #10 in 2301.

Madison would understand.

Census Report: Incomes Rise only for the Old

This could lead to a seismic political shift:

The incomes of the young and middle-aged — especially men — have fallen off a cliff since 2000, leaving many age groups poorer than they were even in the 1970s, a USA TODAY analysis of new Census data found.

People 54 or younger are losing ground financially at an unprecedented rate in this recession, widening a gap between young and old that had been expanding for years.
While the young have lost ground, older people have grown more prosperous over the years and the decades. Older women have done best of all.

The dividing line between those getting richer or poorer: the year 1955. If you were born before that, you're part of a generation enjoying a four-decade run of historic income growth. Every generation after that is now sinking economically.

Household income for people in their peak earning years — between ages 45 and 54 — plunged $7,700 to $64,349 from 2000 through 2008, after adjusting for inflation. People in their 20s and 30s suffered similar drops. Older people enjoyed all the gains.

This coupled with the extra attention older Americans are paying to health care reform, sue to concerns it will harm them specifically, makes me wonder if age differences in political opinions are becoming more acute.

Bad Stuff About Goldman-Sachs

Here's a great, and damning, piece about the influence of Goldman-Sachs. The author sees them fueling and profiting from every bubble of the past seven decades.

Do U.S. Regulations Inhibit the Development of a Domestic Solar Energy Industry?

Thomas Friedman argues that solar power shows signs of booming in countries where regulations allow it to grow. He suggests that existing regulations in the United States do not, and continue to favor the oil, gas and coal industries that have dominated the energy sector for years.

The reason that . . . other countries are building solar-panel industries today is because most of their governments have put in place the three prerequisites for growing a renewable energy industry: 1) any business or homeowner can generate solar energy; 2) if they decide to do so, the power utility has to connect them to the grid; and 3) the utility has to buy the power for a predictable period at a price that is a no-brainer good deal for the family or business putting the solar panels on their rooftop.

Regulatory, price and connectivity certainty, that is what Germany put in place, and that explains why Germany now generates almost half the solar power in the world today and, as a byproduct, is making itself the world-center for solar research, engineering, manufacturing and installation. With more than 50,000 new jobs, the renewable energy industry in Germany is now second only to its auto industry.

. . .

If you read some of the anti-green commentary today, you’ll often see sneering references to “green jobs.” The phrase is usually in quotation marks as if it is some kind of liberal fantasy or closet welfare program (and as if coal, oil and nuclear don’t get all kinds of subsidies). Nonsense.

This is another example of demosclerosis, covered below and in our lectures on Federalist #10. It also illustrates the concept of agency capture, the process by which an interest group can effectively capture a regulatory agency and ensure that any regulations it issues will favor the industry, not the general welfare.

Socialized Police Forces

While people are talking mostly about the pros and cons of socialized health care, the same question is being applied elsewhere. We have socialized police protection. Should it be privatized?

Where Does Wealth Come From

This is a very provocative piece. It comments on an important dispute underlying politics in the United States, though it is never stated in this cleanly:

Who Are the Wealth Creators?

Is it labor? Is it the investment class? Is it management? Entrepreneurs? This is a vital question because one's answer will determine which groups one is likely to favor, and which public policy choices they are likely to make.

On Demosclerosis

In 2301 we are covering Federalist #10 and its consequences. In it Madison argues that the way to break up majority factions -- and thus prevent the violence of factions that undermines popular governments -- is to design the governing system so that a great number of issues will be brought into the political sphere which makes it impossible for permanent majorities to form. Every interest is a minority interest.

But this causes problems too because these interests can "clog the administration" meaning that they can make it difficult for government to respond to public needs. The current term for this is "demosclerosis." In a conversation about a recent rash of rude behavior (or at least a recent tendency of the media to pay attention to rude behavior), David Brooks touches on the terms and puts it in context. It should be useful for my 2301 students:

. . . there is a broad consensus on what we need to do to solve many of our major problems, but no political way to get there. Most experts of left and right believe we need a gas tax in order to address our energy problems. No political way to get there. Most believe that we need a flatter, fairer tax code, probably based on a consumption tax. No political way to get there. Most agree that the fee-for-service system drives up health care costs and the employer based insurance system is unsustainable. There is apparently no political way to change these things. Most experts agree that teacher quality is crucial to the schools and that bad teachers need to be fired. Again, no political way to do this.

I could go on. It all reminds me of a thesis that Mancur Olson came up with many years ago, which was nicely explained in Jonathan Rauch’s book, “Demosclerosis.” The thesis was that as nations age they develop entrenched relationships that close off certain avenues of change. This leads to the decline of nations. Germany and Japan, on the other hand, were able to grow so quickly after World War II because those entrenched arrangements had been swept away amid the national cataclysms.

The Baucus Bill

Story in

- the Washington Post.
- the New York Times.
- Baucus Press Release.

Against Corporate Campaigning

An NYT Editorial:

The Supreme Court may be about to radically change politics by striking down the longstanding rule that says corporations cannot spend directly on federal elections. If the floodgates open, money from big business could overwhelm the electoral process, as well as the making of laws on issues like tax policy and bank regulation.

. . .

Most disturbing, though, is the substance of what the court seems poised to do. If corporations are allowed to spend from their own treasuries on elections — rather than through political action committees, which take contributions from company employees — it would usher in an unprecedented age of special-interest politics.

Corporations would have an enormous say in who wins federal elections. They would be able to use this influence to obtain subsidies, stimulus money and tax loopholes and to undo protections for investors, workers and consumers. It would take an extraordinarily brave member of Congress to stand up to agents of big business who then could say, quite credibly, that they would spend whatever it takes in the next election to defeat him or her.

Health Care's Revolving Door

From Politico comes a report that some of the Senate Finance Committee aides that are helping piece together health care legislation have connections to the health care industry. This leads to the reasonable suspicion that the health care industry may well be writing the bill itself:

Some of the most influential aides in the closed-door Senate Finance Committee negotiations over health care reform have ties to interests that would be directly affected by the legislation.

Before she was hired last year as senior counsel to Finance Committee Chairman Max Baucus (D-Mont.), Liz Fowler worked as a highly paid public policy adviser for WellPoint Inc., the nation’s largest publicly traded health benefits company.

Mark Hayes, health policy director and chief health counsel for Finance Committee ranking member Chuck Grassley (R-Iowa), is married to a registered lobbyist for a firm that represents drug companies and hospital groups, although the couple says she doesn’t lobby Grassley’s office.

Frederick Isasi, a health policy adviser to Sen. Jeff Bingaman (D-N.M.), was a registered lobbyist at Powell Goldstein, where his clients included public hospitals and the American Stroke Association.

Kate Spaziani, senior health policy aide to Sen. Kent Conrad (D-N.D.), was also a registered lobbyist at Powell Goldstein, although Conrad’s office says she worked as a lawyer — not as a lobbyist — for public hospitals on Medicare issues.

There’s no evidence that the aides’ ties have shaped the bill that Baucus hopes to release Tuesday, and the ultimate decisions over its provisions rest with the senators themselves. But critics say the involvement of such well-connected insiders could lead to dangerous conflicts.

Interest Group Contributions to Committees

From the Center for Responsive Politics:

- Insurers On Alert Have Given $4 Million to Committees Grilling Them.

This puts an interesting spin on committee hearings. What if you are a member of Congress, and you are attuned to the need for campaign funding in order to hold onto your job, and you are going to hear testimony from interest groups representatives who also contribute to your campaign. Are you going to grill them hard, at the risk of losing support, or will you play softball instead?

It's back to school and 52 insurance companies or their subsidiaries have an assignment due today: they must disclose their financial records, including details on executive pay and entertainment expenditures, to House Energy and Commerce Chairman Henry Waxman (D-Calif.).

While this puts mega-insurers such as AFLAC and Blue Cross/Blue Shield on alert, they might find some comfort in that collectively they enjoy a financial bond with the current committee members. The members have collected $2.9 million from the employees and political action committees of the insurers that received letters from Waxman in August. Fifty-three percent of those donations has gone to Republicans.

Waxman himself has brought more money from the companies he's questioning than all but four other members of the committee. His total haul since 1989 is $106,500. Ranking member Rep. Joe Barton (R-Texas) has collected $84,350 in that time.

Wall Street Reforms Resisted

As we explore the influence of interest groups on government, we should look at the glacial pace the reforms aimed at Wall Street have taken in the past year since the financial melt-down happened.

From NPR:

In the immediate wake of the stock market crash and soaring unemployment, there were loud cries for tighter new financial regulations to prevent a repeat of such a painful episode.

Today, the energy behind such a push seems to have dissipated. The economy has not recovered yet, but it's no longer in free fall. The stock market has risen from the depths of earlier this year.
"While this recession is comparable to the 1930s in some respects, the deprivation and poverty is less visible than it was in the '30s," says Geoffrey Hodgson, a research professor in business studies at the University of Hertfordshire in the United Kingdom.

"There's a complacency amongst the public at large and among politicians."

One reason may be the difficulty in organizing the grassroots forces that may wish to rally for change versus the relative ease that anti-reform forces have in organizing on their side.

Heather Booth hopes that is not the case. She run Americans for Financial Reform, an advocacy group with nearly 200 members, including AARP and the AFL-CIO. As her group works to organize a push for widespread financial reforms, she expects a growing grass-roots call for change.

"We think people have been operating out of not just frustration, but fear," Booth says. "If that fear turns to hope for a real solution, and also, as fear changes to anger towards those who created this, we think there will be mobilization for change."

But mobilizing a mass movement is difficult under any circumstances, and the causes of this economic crisis are particularly complex and ill-understood by the American public.

The financial sector remains one of the most powerful interests in Washington. Here is a link to a page from the Center for Responsible Politics that shows the increase in the amount of money securities firms have donated to campaigns in the past electoral cycles. They do expect a return on their investment.

Party Polarization Increases

Though we may have thought it impossible that it could, and the development may not bode well for our ability to govern ourselves effectively.

From Ronald Brownstein:

America is steadily moving away from the ramshackle coalitions that historically defined our parties and toward a quasi-parliamentary system that demands lockstep partisan loyalty. It is revealing that Obama is facing nearly unanimous Republican opposition on health care just four years after President Bush couldn't persuade a single congressional Democrat to back his comparably ambitious Social Security restructuring.

In this emerging parliamentary system, legislators face enveloping pressure to stand with their side against the other on every major issue. Tellingly, Sens. Max Baucus, D-Mont., and Charles Grassley, R-Iowa, the leaders of the Senate Finance Committee's protracted negotiations, both confronted whispers that they might lose their leadership positions if they conceded too much to the other side. . .

Compounding the pressure has been the development of partisan communications networks -- led by liberal blogs and conservative talk radio -- that relentlessly incite each party's base against the other. Those constant fusillades help explain why presidents now face lopsided disapproval from the opposition party's voters more quickly than ever -- a trend that discourages that party's legislators from working with the White House.

. . . .

Party-line governing is intrinsically flawed. Any bill that must pass solely with votes from the majority party can't realistically incorporate ideas that divide the party. And that fact of life rules out half the tools in our policy toolbox. Though medical-malpractice reform would advance Obama's cost-control goals, for instance, it's impractical to include it in legislation that must pass solely with Democratic votes. Legislation is more balanced when both parties shape it.

How Rational are Markets Really?

After we discussed the central role rationality played in the development of the concept of natural rights comes questions about just how rational, at least in terms of economics, we really are. From Paul Krugman:

As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth. Until the Great Depression, most economists clung to a vision of capitalism as a perfect or nearly perfect system. That vision wasn’t sustainable in the face of mass unemployment, but as memories of the Depression faded, economists fell back in love with the old, idealized vision of an economy in which rational individuals interact in perfect markets, this time gussied up with fancy equations.

. . . this romanticized and sanitized vision of the economy led most economists to ignore all the things that can go wrong. They turned a blind eye to the limitations of human rationality that often lead to bubbles and busts; to the problems of institutions that run amok; to the imperfections of markets — especially financial markets — that can cause the economy’s operating system to undergo sudden, unpredictable crashes; and to the dangers created when regulators don’t believe in regulation.

A Few Laws to Review this Week

This week in 2302 we will dig into the internal workings of Congress. A good way to begin is to compare how different laws bills have been passed into law this session made their way through Congress. We'll look at the following:

- The Lily Ledbetter Fair Pay Act of 2009.
- Children's Health Insurance Program Reauthorization Act of 2009.
- Helping Families Save Their Homes Act of 2009.

What Kind of Chief Justice Will Roberts Choose to be?

John Marshall or Earl Warren? Will he be conciliatory and seek consensus or will he be willing to overturn precedence for the sake of his ideological vision? The answer may lie in how he approaches a decision in Citizens United v. the FEC.

From a commentary by Jeffrey Rosen:

. . . if the Roberts court issues a sweeping 5-to-4 decision in the current case, Citizens United v. the Federal Election Commission, striking down longstanding bans on corporate campaign expenditures, it would define John Roberts as indelibly as Miranda defined Earl Warren. And there is no reason for the court to do so: it would be easy for the justices to rule narrowly in the Citizens United case, holding that the corporate-financed political material in question — a documentary called “Hillary: the Movie” — isn’t the kind of campaign ad that federal law was intended to regulate.

But many conservatives, and even some liberal devotees of the First Amendment, are urging the Roberts court to uproot federal and state regulations on corporate campaign spending that date back to 1907, as well as decades of Supreme Court precedents. If Chief Justice Roberts takes that road, his paeans to judicial modesty and unanimity would appear hollow.

Generation Gap on Health Care Reform

Here's something worth discussing in 2301 as we investigate political conflict. The dispute over health care reform has revealed a growing generational gap between older voters who are opposed to it -- and the Obama Presidency in general -- and younger voters who are not:

. . . Older Americans are more likely to oppose Mr. Obama’s initiative than any other age group. The White House views this dynamic as one of the biggest obstacles to tamping down public concerns about its approach and assembling a legislative coalition to get a bill passed in Congress.

Older voters were one of the few groups Mr. Obama did not win in the presidential election last year, leaving him and his party particularly reliant on younger voters, who do not show up at the polls as reliably as older people do. They have a dimmer view of his presidency than the rest of the nation.

And there is no reason to think that whatever tensions have been unearthed with this fight are going to end once it is resolved. Mr. Obama has signaled his intention to tackle the long-term financial problems of Social Security, another issue the elderly play an outsize role in, and they tend to be resistant to change there, too.

Poll Results: Trust in Government Institutions

As I'm putting together notes for a discussion of the legislative branch, I'm faced with a quandary. While commentators dating back to Madison and before talk about the legislative branch as having a special connection to the general population, the contemporary Congress has lower approval ratings than either of the other two branches.

This is according to a recently released Gallup Poll:

At a time when President Obama is asking Congress to develop and pass far-reaching healthcare reform legislation, a record-low 45% of Americans say they have a great deal or fair amount of trust in the legislative branch of government, far fewer than trust the judicial (76%) or executive (61%) branches. Second only to the judicial branch are Americans themselves -- 73% trust "the American people as a whole" to make judgments about the issues facing the country.

It is especially ironic that the judicary is trusted more than the other branches since it is the one appointed for lifetime terms, and the most fully removed from the preferences of the general population. This goes against everything we say in class about the degree to which each institution is tied into the preferences of the general population.

I'm open for explanations.

I do have a cynical take on this however. We don't like Congress because it's closely tied to our immediate preferences. The general population is flighty, superficial and unstable and this is reflected in the behavior our representatives. When we see it in action, we don't like what we see. We prefer the institutions that are removed from our worst tendencies.

But maybe I'm just having a bad day.

Citizens United v. FEC

This may become the most important case argued before the Supreme Court this year. The case is Citizens United v the Federal Election Commission.

The case is essentially about whether corporations have first amendment speech rights and whether these were violated when a documentary critical of Hillary Clinton was not allowed to be shown before primary elections last year. The court seems poised to reverse years of precedence stating that such advertising can be limited.

Here's a bit from the NYT:

There seemed little question after the argument in an important campaign finance case at the Supreme Court on Wednesday that the makers of a slashing political documentary about Hillary Rodham Clinton were poised to win. The open issue was just how broad that victory would be.

For more background:

- Citizens United v. Federal Election Commission - ScotusWiki
- Citizens United v. Federal Election Commission - Wikipedia

Obama and the Bully Pulpit

One of the advantages that presidents are said to have over Congress is the ability to effectively take a message to the public and frame the debate around issues so that his proposals are advantaged over those of his opponents. That is effectively what last night's speech was about. The question will be whether his efforts are effective.

Here are links to additional info about the speech and some of the commentary surrounding it:

- video of the speech.
- video of the Republican response.
- NYT: An Attempt to Reignite Obama's Presidency.
- Gallup Poll page on health care.