Reuters has helpfully published another article demonstrating that ObamaCare’s biggest cheerleaders are the insurance and drug industries. That’s because, barring repeal and despite the Obama administration’s fatuous rhetoric about standing up to the special interests, ObamaCare will shower those industries with massive subsidies. Excerpts follow.

Health Overhaul Should Press Ahead: Industry

By Susan Heavey

Thu Nov 11, 2010 1:39pm EST

NEW YORK (Reuters) — Repeal reform? No thanks, say health insurers, drugmakers and others looking for a clearer picture of the U.S. healthcare market after the bruising passage of the controversial overhaul law…

The new healthcare law created “a stable, predictable environment, however painful it has been in the short term,” GlaxoSmithKline Plc’s (GSK.L) Chief Strategy Officer David Redfern said at the summit in New York.

“When you are running a business, the hardest thing is changing policy and a changing environment because it is very difficult to plan, predict and ultimately invest in that sort of scenario,” he said, echoing other speakers.

True enough. How’s a firm supposed to develop a business plan around uncertain taxpayer subsidies?

Health officials must still hammer out how to implement the law and finalize hundreds of new rules and regulations. Many such details are key, as the sector looks to adjust its business for 2011 and beyond.

Wait, I thought the law created a “stable, predictable environment” and repeal would create uncertainty. Hmmmm.

“Anti-reform made good talking points before the election,” said the Department of Health and Human Services’ Liz Fowler, adding that people “will find more to like than to dislike” in the law once it is more in place.

Boy, they just won’t let go of that chestnut, will they? Remember: voters need re-education, not the Obama administration.

Even insurers, which were vilified by Democrats in passing the reforms, said they don’t want a repeal, even as they push for clarity on forthcoming rules and seek additional changes.

Cigna Corp CEO David Cordani and Aetna Inc President Mark Bertolini both urged the nation to move forward on the overhaul.

Even the insurance industry is against repeal? The folks whose products the law will force 200 million Americans to purchase? Never saw that coming.

Since the start of 2009, the Morgan Stanley Health Care Payor index has risen 75 percent, outperforming a roughly 35 percent rise for the broader Standard & Poor’s 500 index.

You don’t say.

Unlike insurers[!], drugmakers have escaped largely unscathed under the law, although there is still incentive to shape it.

You don’t say.

My colleagues, Dan Mitchell, Jagadeesh Gokhale, Michael Cannon and Chris Edwards have already provided their thoughts on the chairman’s mark released yesterday by the bipartisan deficit reduction commission. A few additional thoughts:

The commission provides a good-faith look at the magnitude of the problem we face, and the magnitude of cuts necessary to bring spending down to even 21 percent of GDP (and it really should be far lower). In doing so they show just how unserious Republicans are in proposing a paltry $100 billion in spending cuts. And the commission makes it clear, unlike Republicans, that both entitlements and defense spending must be on the table.

The commission also starts the debate in a useful direction by implicitly acknowledging that their need to be some limits to government spending—that government cannot consume an ever-increasing proportion of GDP. (Without a change in policy, the federal government will consume 43 percent of GDP by 2050.)

But ultimately the report falls short because it fails to address the proper role of government. In fact, it tacitly accepts the idea that government should be doing everything it is doing now. It even acquiesces to the new health care law. As a result, it fails to reduce the size of government sufficiently to avoid tax hikes, let alone permit tax cuts in the future.

Moreover, because the commission leaves the basic structure and role of government intact, it raises questions about the future viability of its proposed mix of spending cuts and tax increases. History demonstrates that it is far too likely that tax hikes will be permanent, while spending cuts will last as long as the next year-end emergency appropriations bill.

As the commission moves toward a final report on December 1, members would be advised not to focus just on the details of these proposals, but to have a serious and deliberative discussion of what the federal government should and should not be doing.

When I first started arguing that now is the time to press the case for eliminating the U.S. Department of Education, I noted that the biggest obstacle to scaling down fed ed has long been the cheap-shot smearing of would-be downsizers. Today, I want to thank Kevin Carey, Policy Director at the think tank Education Sector, for brilliantly illustrating that very unsightly strategy.

Writing on Education Sector’s blog yesterday, Carey ripped into a post I put up that morning, a post that primarily linked to a call to abolish ED from a left-leaning educator. Carey’s rejoinder: Basically, Cato hates public education, and there’s a whole lotta crazy goin’ on:

The Cato Institute is dedicated to creating “a future where government-run schools give way to a dynamic, independent system of schools competing to meet the needs of American children,” i.e. destroying public education as we know it. As such, Cato wants to abolish the U.S. Department of Education. This fringe notion was first advanced by Ronald Reagan, until A Nation at Risk was published and the Great Communicator abruptly made an about-face and became very interested in an expanded federal role in K‑12 policy as way to appeal to moderate voters in the 1984 election. The idea come up again a decade later during the brief rise of Gingrichism before fading into deserved obscurity for the next 15 years.

Then Tea Party candidates like Sharron Angle revived the kill Education platform, based on a general antipathy toward the federal government combined with not knowing anything about education.…

So now reporters are calling me all the time asking me whether to take this stuff seriously. The answer is: No. Do not take it seriously. Nobody is shutting down the U.S. Department of Education. If one thing is sure in this life, one certainty that can be clung to like a rock in a storm, it’s that Congressional Republicans don’t actually want to shrink the size of the federal government, reduce the deficit, or cut federal programs in any meaningful way, particularly programs that enjoy broad public support as education programs do.

That plain fact, however, hasn’t prevented Cato’s education analysts from excitedly suggesting that the Department of Education abolition movement is on the rise. Few have joined their cause, because few people want to destroy public education as we know it. However, today Cato’s Neal McCluskey identified an ally in the reactionary anti-reform left.…

[Long quote from my post]

There you have it: if you were wondering who besides the Cato Institute, an organization dedicated to applying principles of extreme privatization to all walks of public life, is out there enough to abolish the Department of Education — well, now you know.

That said, beyond the “There will always be strange bedfellows in Crazy Town” aspect of this, it does raise the interesting question of whether the NEA and other hardcore anti-accountability / anti-charter / anti-testing / anti-merit pay / anti-TBD people would be willing to join forces with Congressional Republicans to visit some kind of serious harm on the federal education framework of standards, testing, and accountability.

Where to begin…

Let’s start with what’s not in Carey’s big bag o’ belittling: substance. At the root of my argument for eliminating ED is the reality that federal intervention in education has produced little by way of educational improvement while costing significant amounts of money. It is also of highly questionable constitutional validity. So my argument isn’t driven by blind ideology, or just plain wackiness, but serious policy concerns, foremost of which is that ED isn’t actually good for education — which is our main concern, right? — or the country. But those concerns are nowhere mentioned in Carey’s post, and he implies that if you share my opinion, as Sharron Angle does, you probably know nothing about education.

Carey’s dismissal of George Wood, whose blog post is the heart of the entry I wrote that sent Carey over the edge, is similar. Wood makes very logical arguments for why ED is a net loss and should be absorbed into a department like Health and Human Services. I don’t agree with all of his reasoning, but it clearly shows logical thinking about why ED should go. Carey’s response: Forget your arguments, you belong in “Crazy Town” with McCluskey.

How about the stuff that is in Carey’s post?

First, there’s the usual attack that Cato-types are nutty fringers who want to destroy “public education.” As I have (obviously ineffectually) tried to explain to Carey before, I am not against public education, in which government ensures that everyone can access education. I am against public schooling, in which government runs the schools. This gets directly to the bedrock question of how best to operate education in a free society, as well as make schooling work primarily for parents and kids. And contrary to the connotation of phrases like “destroying public education as we know it,” government run schooling with a huge federal presence has hardly been the standard for most of American history.

Here’s another bit of history Carey misrepresents. He suggests that Ronald Reagan’s efforts to abolish ED in the early 1980s were part of a “fringe notion” that there shouldn’t be an ED. That’s a little hard to take, considering that ED was created by legislation signed in 1979, and didn’t start functioning until 1980. Oh, and the final House vote on the Department? It won by a scant 4 votes, 210 to 206. And heck, even American Federation of Teachers President Albert Shanker opposed the new Department. So yeah, very fringy.

Where Carey does make sense is in his argument that for political reasons it is not very likely that the Department of Education will be abolished. “If one thing is sure in this life,” he writes, “it’s that Congressional Republicans don’t actually want to shrink the size of the federal government, reduce the deficit, or cut federal programs in any meaningful way, particularly programs that enjoy broad public support as education programs do.”

Carey is far too certain about what’s in Congressional Republicans’ hearts — I bet many really do want to shrink government and reduce the deficit — but based on recent history it’s certainly reasonable to be dubious that as a group they’ll do those things. But I have never said anything different — indeed, I fully acknowledged the political obstacles:

Yesterday, Tad DeHaven wrote about an interview with Rep. John Kline (R‑MN), likely chairman of the House Education and Labor Committee should the GOP take the House majority. Tad lamented that Kline seemed to declare any potential effort to kill the U.S. Department of Education (ED) already dead in the water. Unfortunately, Kline is certainly right: Any effort to kill ED in the next couple of years would not only have to get through a (presumably) GOP-held House, but (also presumably) a Dem-controlled Senate and Obama-occupied White House. There just aint no way ED will be dismantled — and more importantly, it’s profligate programs eliminated — in that environment.

That said, if many Tea Party-type candidates win today, it will be precisely the time to start pushing the immensely powerful case for ending fed ed.

I have been very clear in stating that now is the time to start pushing in earnest to end ED, not that success is almost here. But that just doesn’t fit in the “Crazy Town” narrative, I guess.

Anyway, thanks to Kevin Carey for furnishing a terrific example of this most crucial of points: The federal education war is rarely fought with reason and evidence. No, cheap shots and demonization, sadly, are the weapons of choice.

The following exchange took place yesterday on the Christian Broadcasting Network between host David Brody and Tea Party Express Chairwoman Amy Kremer.

Brody: Mitt Romney…on the Massachusetts health care situation, you’re going to tell me that’s going to fly in the Tea Party movement?

Kremer: Absolutely not…I’m being honest here…You can’t get away from that. And that’s the thing is, the days of people being able to do one thing in their state in front of a microphone, and then going to Washington and doing something else. I mean, the Internet, and 24-hour news cycles changed it all, and these people don’t have short memories, they’re digging up everything from the past, and they’re not going to let go of the health care.

Hmm. I wonder why…

Video of the CBN exchange is available here. For more on RomneyCare, read “The Massachusetts Health Plan: Much Pain, Little Gain.”

Last week I urged readers to be on the lookout for Republicans seeking to exclude farm subsidies from any cuts they plan to make to federal spending. And it seems the first example of “smaller government for thee, but not for me” has been provided by incoming congresswoman Vicki Hartzler, who campaigned on a Tea Party-ish platform and defeated long-time congressman Ike Skelton (in Missouri’s 4th congressional district).

Ms. Hartzler calls Margaret Thatcher her role model because she “took principled stands.” (As, indeed, she often did.) Ms. Hartzler also says economic issues — cutting government spending, complete repeal of the health care bill — are her main concern. But read the fine-print in this article from the St. Louis Beacon:

Hartzler says cutting spending is a top personal priority; she wants to roll back non-discretionary funding levels to 2008 levels, before the economic stimulus and TARP programs. …

The congresswoman-elect would exempt some of the federal budget’s high-cost categories — including Social Security, Medicare and the Pentagon budget — from cutbacks. But she would not exempt agricultural subsidies,* another major area of federal spending popular in rural areas such as west-central Missouri’s Fourth District. Among the many farms to receive such subsidies is the 1,700-acre Hartzler farm, which — according to the Environmental Working Group’s “Farm Subsidy Database” — received about $774,000 in federal payments (mainly commodity subsidies for corn, soybeans and wheat) from 1995 through 2009.

“Everything should be on the table,” she says. While she says some agriculture programs represent a “national defense issue” because they help guarantee that “we have a safety net to make sure we have food security in our country,” Hartzler adds: “Should we continue the CRP [Conservation Reserve] program, where you pay farmers to not plant ground and set it aside for awhile? I’m not sure. The time for that may be over.” [emphasis added]

Let’s be clear about what Ms. Hartzler is talking about here. Those “some” agricultural programs she says should be guaranteed on “national defense” grounds (see below) are what we commonly think about as “farm subsidies” — payments to farmers to produce certain commodities, whether those payments are funded by taxpayers or consumers. They encourage overproduction and thus alienate our trade partners, complicate efforts to make global trade freer, harm poor farmers abroad and damage America’s reputation in the process. They cost us billions of dollars a year.

She is, on the other hand, open to cutting farm programs that at least pretend to have environmental benefits. I’m not commenting here on the validity of those sorts of “public goods” claims, and of course I am not conceding that the federal government should be involved in them. But I think most reasonable people would agree that they are less economically damaging than traditional farm subsidies. In other words, in the hierarchy of damage, and therefore in the hierarchy of what should be cut first, I would put farm subsidies ahead of the CRP. And I fail, in any event, to see how anyone calling themselves a fiscal conservative can promote the idea of excluding a priori that which we commonly think of as “farm subsidies.”

[Also, can we please abandon once and for all this nonsense idea that we need farm subsidies to have food security? Appeals to “national defense” are disingenuous and cynical. They are also belied (rather obviously) by the fact that we see abundant supplies of fruit, vegetables and other horticultural goods even though those products attract no subsidies directly. The best way to ensure a food security is to ensure open markets, so food can flow from where it is abundant to where it is scarce. Self-sufficiency is a misguided policy, as the experience of North Korea can attest.]

So, in summary, when Ms. Hartzler says “everything should be on the table”, she basically means “not much, and certainly nothing that might harm powerful special interests that I care about.” I lost count of the number of Republican politicians being interviewed during the campaign and on election night talking about the need for “across-the-board cuts to discretionary spending” as their fiscal plan. Most if not all of them emphasized that so-called mandatory spending (which includes some farm subsidies) would be exempt from their cuts. I’m sorry, but I cannot take seriously the “fiscal conservative” credentials of any politician who adopts such a line.

*It appears, judging from the quote below, that she would indeed exempt farm subsidies from cuts, even if other farm programs would be on the chopping block. I’m going to assume here the reporter was using the term “farm subsidies” in an imprecise manner.

It’s kudos to President Obama’s Debt Commission co-chairs for clearly outlining the gargantuan size of the fiscal problem facing the United States. The reforms will re-direct the exploding debt trajectory downward by reforming taxes and cutting spending – reminiscent of recent fiscal reforms in the United Kingdom. Unfortunately, history is likely to repeat itself: Even if they are enacted soon — which seems unlikely — chances are bleak that we’ll stick with them for long enough to achieve their stated goals.

The Debt Commission co-chairs have done a stellar job in framing the nation’s fiscal challenge and placing it squarely before the American public. The contrast between the current trajectory that increases the national debt beyond 80 percent of GDP by 2040 and one of declining debt under their reforms likely to be consistent with long-term economic growth because the Commission also proposes limiting government spending to 21 percent of GDP — is striking.

The Commission has marked wide-ranging reforms — to broaden the federal tax base, reduce income tax rates and simplify the tax system; cut discretionary expenditures that are unaffordable and antiquated in all spheres; reduce long-term health care cost growth, and restore Social Security to financial solvency through a combination of benefit cuts and revenue measures.

It’s sad but true that the political barriers stacked up against this promising approach appear to be insurmountable. Given the make-up of Congress and with Obama as President, the chance that something even remotely resembling the Commission’s proposals would be enacted is negligibly small. With the Democratic majority in the Senate, President Obama is unlikely to even have to use his veto.

But what if my conjecture is proved incorrect and a roughly similar set of reforms is enacted in 2011? Remember that our fiscal problem is of a long-term nature. It is produced by an aging population; rapid health care cost growth; slower revenues from a flagging economy as a large cohort of experienced workers retires; slowing education and skill acquisition by younger workers; and slower capital formation as more resources are consumed by an aging population. The commission’s reforms have to be enacted and maintained for at least 30 years to deliver its “target” debt-to-GDP ratio of 40 percent. History tells us that such an outcome is quite unlikely. For example, the Budget Enforcement Act of 1990 — that helped President Clinton accumulate his now much touted laurel as a fiscal conservative — was maintained for just 12 years — until Congressional Budget Office projections revealed “budget surpluses as far as the eye could see” in 2002. With those projections in hand, lawmakers raced to the exits: the BEA was abandoned and federal spending shot through the roof. Even as conservative a policy maven as Alan Greenspan shone a green light to adopt budget busting tax cuts.

To improve the chances that history does not repeat itself, the commission’s proposals need to be combined with proposals to reform the budget process. The first thing to consider on that score is to use better budget measures to assess if reforms are achieving their goals. Stating those goals in terms of the national debt and annual cash flow deficits is unlikely to work – just as those measures have not worked for the European Union in the context of their now defunct Stability and Growth Pact.

Federal debt and the current budget deficit that is reported on the government’s books is the result of past policies and outcomes. They summarize where we came from, not where we’re going. If the commission’s reforms are enacted, a better method would be to anchor judgment about their success on the size of prospective debt—the value in today’s dollars of all future deficits that the federal government would incur under the new policies; alternatively under premature abandonment of those policies – as happened in 2002 when the BEA was abandoned. It is also important to know whether the sacrifices that the commission’s policies require from today’s generations are fairly distributed and are being invested for the future rather than being dissipated. For example, will the Social Security surpluses that the reforms generate be effectively saved and invested, or would they promote additional government spending as in the past? Without a budget process that delivers real investments for the future, and without metrics to measure their operation properly, chances are that even if Congress and the President enact them into law next year, the reforms will be abandoned too soon.

That’s what the attorney for former CIA officer Jose Rodriguez is saying about his client. Rodriguez and other CIA personnel destroyed videotapes of detainee interrogations. The Justice Department announced that Rodriguez will not face criminal charges, but did not elaborate on the reasoning behind the decision.

Rodriguez’s decision to get rid of the tapes came after White House lawyers, responding to a court order, instructed the CIA not to destroy any evidence associated with detainee interrogations.

I know that the term “slippery slope” is overused, but it’s clearly evident here. Thwart the rule of law by declaring torture legal, thwart it again to cover up your actions.