In 1998, after years of scandals ranging from governors being indicted to legislators taking bribes, Arizona passed the Citizens Clean Elections Act. This law was intended to “clean up” state politics by creating a system for publicly funding campaigns.

Participation in the public funding is not mandatory, however, and those who do not participate are subject to rules that match their “excess” private funds with disbursals to their opponent from the public fund. In short, if a privately funded candidate spends more than his publicly funded opponent, then the publicly funded candidate receives public “matching funds.”

Whatever the motivations behind the law, the effects have been to significantly chill political speech. Indeed, ample evidence introduced at trial in a lawsuit challenging the law showed that privately funded candidates changed their spending — and thus their speaking — as a result of the matching funds provisions. In elections, where there is no effective speech without spending money, the matching funds provision of the Clean Elections Act diminishes the quality and quantity of political speech.

In 2008, the U.S. Supreme Court in Davis v. FEC struck down a similar provision in the federal McCain-Feingold law in which individually wealthy candidates were penalized for spending their own money by triggering increased contribution limits for their opponents. Even this modest opportunity for opponents to raise more money was found to be an unconstitutional burden on political speech.

Cato has thus filed a brief supporting a request that the Supreme Court review the lower court’s decision upholding Arizona’s Clean Elections Act. We highlight Davis (in which Cato also filed a brief) and numerous other cases that point to a clear conclusion: if the mere possibility of your opponent getting more money is unconstitutional, then the guarantee that your opponent will get more money (Arizona’s act automatically disburses matching funds) is even more so. Allowing the government to abridge political speech in this fashion not only diminishes the quality of our political debate, but it ignores the fundamental principle upon which the First Amendment is premised: that the government cannot be trusted to regulate political speech for the public benefit. 

The Supreme Court will decide later this fall whether to review this case, McComish v. Bennett.

Today is Constitution Day, when all educational institutions are supposed to teach something about our founding document and when all citizens should think about the liberty that is so precious, but that requires, as Jefferson said, eternal vigilance. We at Cato celebrate Constitution Day with our annual symposium – this year held yesterday so as to accommodate Yom Kippur, which begins tonight – and by releasing the Cato Supreme Court Review, the nation’s first in-depth review of the Supreme Court term just ended.

We’ve now had nine such conferences – which take place about two and a half months after the previous term concludes and two weeks before the next one begins – and published nine such volumes. We are proud of the speed with which we publish the Review – authors of articles about the last-decided cases have little more than a month to provide us full drafts – and of the tome’s accessibility, at least insofar as the Court’s opinions allow for that. Both the book and the conference are intended for everyone from lawyers to educated laymen and interested citizens.

I hope that our Constitution Day event and the Review’s collection of essays will deepen and promote the Madisonian first principles of our Constitution, giving renewed voice to the Framers’ fervent wish that we have a government of laws and not of men. In so doing, we hope also to do justice to a rich legal tradition in which judges, politicians, and ordinary citizens alike understood that the Constitution reflects and protects the natural rights to life, liberty, and property – including The Right to Earn a Living, to quote the title of a new book by my friend and Cato adjunct scholar Timothy Sandefur (for which we’re having a Hill briefing today and book forum Monday) – and serves as a bulwark against the abuse of government power.

In this uncertain time of individual mandates, endless “stimulus,” financial “reform,” and general overreach, it is more important than ever to remember our Constitution’s roots in the Enlightenment tradition.

Not that we need more evidence, but here is a story from Los Angeles revealing that the city only created 55 jobs with $111 million of stimulus funds. This translates to a per-job cost of $2 million, which is a grossly inefficient rate of return. But this calculation is incomplete because it doesn’t measure how many jobs would have been created if the money had been left in the productive sector of the economy. Moreover, it’s also important to consider long-term costs such as the fact that Los Angeles now has more overhead, which will exacerbate the city’s fiscal problems.

A snippet:

The Los Angeles City Controller said on Thursday the city’s use of its share of the $800 billion federal stimulus fund has been disappointing. The city received $111 million in stimulus under the American Recovery and Reinvestment Act (ARRA) approved by the Congress more than a year ago.

“I’m disappointed that we’ve only created or retained 55 jobs after receiving $111 million,” says Wendy Greuel, the city’s controller, while releasing an audit report.

…The audit says the numbers were disappointing due to bureaucratic red tape, absence of competitive bidding for projects in private sectors, inappropriate tracking of stimulus money and a laxity in bringing out timely job reports.

During the (initial) congressional debate over ObamaCare, President Obama vilified Anthem Blue Cross of California for a 39 percent rate increase. On Wednesday, the Hartford Courant reported that ObamaCare itself may increase premiums by similar amounts:

Health insurers are asking for immediate rate hikes of more than 20 percent in Connecticut for some plans, citing rising medical costs and federal health reform laws as reasons…

In what might appear to be an oddity, companies are citing a huge range of effects that the health care reform mandates will have on plan prices — from near zero to well over 20 percent. The reason is that among all the plans, some already deliver the provisions required by health reform, while others do not…

Anthem Blue Cross and Blue Shield in Connecticut, by far the largest insurer of Connecticut residents, said in a letter that it expects the federal health reform law to increase rates by as much as 22.9 percent for just a single provision — removing annual spending caps. The mandate to provide benefits to children regardless of pre-existing conditions will raise premiums by 4.8 percent, Anthem said in the letter. Mandated preventive care with no deductibles would raise rates by as much as 8.5 percent, Anthem said.

It was unclear how those separate factors would add up for Anthem’s plans, but those potential increases were all on top of rising medical costs.

If those increases are cumulative, ObamaCare could increase premiums for some Connecticut residents by more than 36 percent.

Compare that to what President Obama said in his weekly radio address on February 20:

The other week, men and women across California opened up their mailboxes to find a letter from Anthem Blue Cross. The news inside was jaw-dropping. Anthem was alerting almost a million of its customers that it would be raising premiums by an average of 25 percent, with about a quarter of folks likely to see their rates go up by anywhere from 35 to 39 percent…

And as bad as things are today, they’ll only get worse if we fail to act… We’ll see exploding premiums and out-of-pocket costs burn through more and more family budgets.

It sure seems like President Obama promised that ObamaCare would make things better. Instead, it pushed us out of the frying pan and into the fire.

HHS Secretary Katheleen Sebelius said that Anthem Blue Cross of California’s 39 percent rate increase “just doesn’t make a lot of sense to people across America.” She said those “extraordinary” increases threaten “to make health care unaffordable for hundreds of thousands of Californians, many of whom are already struggling to make ends meet in a difficult economy.” Will she say the same about ObamaCare’s premium increases? Or will she threaten to put Anthem Blue Cross and Blue Shield of Connecticut out of business for its insolence?

I grow increasingly amused at how some people carefully avoid saying that ObamaCare is unpopular.

When Poll​ster​.com aggregates all the various polls on ObamaCare’s popularity, it reveals that a plurality or majority of the public has consistently opposed the law since before the angry town-hall meetings of August 2009:

It’s no surprise when HHS Secretary Kathleen Sebelius avoids the U‑word by saying stuff like, “We have a lot of reeducation to do.” (To be clear, she’s talking about reeducating you, not herself.)

But it’s odd when a Washington Post news item describes the public as “profoundly ambivalent” toward the law. (According to Merriam-Webster, ambivalence means holding “simultaneous and contradictory attitudes or feelings,” “continual fluctuation,” or “uncertainty as to which approach to follow.”) Or when Kaiser Family Foundation president and CEO Drew Altman tells NPR: “The public is split, has been split, and continues to be split.”

I guess those descriptions are true (though “continual fluctuation” and “uncertainty” seem like a stretch). But they’re not very informative. “Ambivalent” doesn’t tell you if one side dominates. “Split” could accurately describe anything shy of unanimity. “Opposed” or “unpopular” or “consensus” would convey so much more information. Why convey less?

Why was the recent $10 billion public school bailout bad for kids as well as taxpayers? How much does Ben Chavis’ #1 ranked middle school in California spend per pupil? Does Michelle Rhee expect to still be DC schools superintendent after Mayor Fenty leaves office? Why do I use the word “unicorn” in describing public school budgets? Tune in tonight to find out: “Stossel,” Fox Business News, 9:00pm Eastern/6:00pm Pacific.

I must be losing my touch. I’ve let nearly two months pass without responding to Ezra Klein’s defense of RomneyCare, ObamaCare, and other centrally planned health care systems. (For those who want to get up to speed: his original post, my reply, and his response.) So here goes.

Klein notes that he and I had each used flawed measures of RomneyCare’s impact on health insurance premiums in Massachusetts. Fair enough. But Klein ignores the study I cited by John Cogan, Glenn Hubbard, and Dan Kessler, which estimates that RomneyCare increased premiums in Massachusetts by 6 percent. The CHK study has limitations, but it is the best estimate available. I hope Klein addresses it.

Klein’s fallback position is that even if RomneyCare increases premiums, that’s not an indictment of the law because cost-control was not one of its goals. Never mind that Mitt Romney boasted, “the costs of health care will be reduced.” Klein knows political rhetoric when he sees it. Yet he oddly sees no parallels between the phony-baloney promises of cost-control used to sell RomneyCare and the phony-baloney promises of cost-control used to sell ObamaCare — despite ample assistance from people like Medicare’s chief actuary and Alain Enthoven (“the American people are being deceived”).

Then Klein throws down his trump card:

[E]ven a cursory read of the evidence would show that whatever the drawbacks of central planning, it covers people at an extremely low cost. Romney Care’s cost problem is a result of pasting a coverage-oriented quick fix atop our insane health-care system. Compare its costs to the British system, the French system, the German system, or any other system, and whatever your conclusions, you won’t walk away unimpressed by the ability of centralized systems to cover whole populations for much less money than we spend.

Oy, where to begin? First, Klein violates Cannon’s First Rule of Economic Literacy: he writes that centrally planned systems cost less, when what he means is that they spend less.

Second, the phrase “whatever the drawbacks of central planning” is some serious hand-waving. Those “drawbacks” include (among other things): the Medicare program’s suppression of comparative-effectiveness research, error-reduction efforts, care coordination, and other delivery innovations; Canada’s human-rights violating Medicare system; and the suppression of untold innovations in health insurance and medical treatment by government price controls. Other than a few drawbacks, Mrs. Lincoln…

Third, our “insane health-care system,” as I blogged previously, “is the product of the old raft of government price & exchange controls, mandates, and subsidies.” Prior to ObamaCare, government already controlled half of all U.S. health care spending directly, granted control over another quarter to employers, and regulated health care more heavily than perhaps any other sector of the economy. Klein and his fellow central planners can’t deny paternity. Our “insane health-care system” is the product of central planning.

Finally, only a cursory read of the evidence could lead to the conclusion that central planning contains health care spending. Klein posts the following charts and concludes that since all those (other) centrally planned systems spend less on health care than the United States, central planning must result in lower health care spending.

[caption align=“aligncenter”]

Photo credit: By Robert Giroux/​Getty Images[/caption]

But if that were true, then one would expect per-capita spending on elderly Americans — who have universal coverage through the centrally planned Medicare program — would not be far out of line when compared to how much other nations spend per elderly resident. Yet the United States is just as far out of here as overall. According to the OECD, the United States spends about twice as much per elderly person as Canada, and more than twice as much as Australia spends. (Alas, I’m not cherry-picking; these are the only four nations for which the OECD provides recent data.)

[caption align=“aligncenter”]Source: OECD, author’s calculations[/caption]

(One could argue that the reason for this is that Medicare exists alongside the world’s largest (ostensibly) private health care sector, whose evils spill over into Medicare. If that were the case, then moving all Americans into Medicare should reduce U.S. health care spending, bringing it back into line with other nations. But consider that Klein and The New Republic’s Jonathan Chait both acknowledge that Congress had to throw $2 at the health care industry for every $1 that ObamaCare cut from future Medicare spending. How exactly could Congress move 250 million Americans into Medicare (which presumably would reduce overall spending), or reduce Medicare spending later, given those constraints? How, exactly, would an independent rationing board survive the political dynamics that produce such outcomes? Prediction: it won’t. The narrative that central planning contains health care spending just doesn’t hold water.)

Klein, The New Republic’s Jonathan Cohn, and others have taken a big step by acknowledging that RomneyCare is struggling. When they shift the blame to “the American health care system,” however, they obscure what’s really happening. As I closed my previous post: “RomneyCare and its progeny ObamaCare are attempts by the Left’s central planners to clean up their own mess. If Klein and Cohn want to defend those laws, pointing to the damage already caused by their economic policies won’t do the trick. They need to explain why government price & exchange controls, mandates, and subsidies will produce something other than what they have always produced.”