John Goodman is correct that ObamaCare’s individual mandate — and Kathleen Sebelius’s power to make the mandate more burdensome at whim — threaten the continued existence of health savings accounts (HSAs). But ObamaCare’s price controls are no less a threat.
The new law requires insurers to charge enrollees of the same age the same average premium, regardless of health status. That’s a price control, and it will cause premiums for healthy people to rise dramatically and thus lead to massive adverse selection. Healthy people will gravitate to less-comprehensive insurance — in particular, HSA-compatible high-deductible plans — where the implicit tax is smaller.
As premiums for comprehensive plans spiral upward (ultimately causing comprehensive plans to disappear) and as ObamaCare proves more costly than projected, supporters will be desperate for new revenue. They will call for the elimination of both HSAs and high-deductible health plans on the grounds that those products — not the price controls, mind you — are causing the market to unravel.
HSAs allow young and healthy consumers to avoid the raw deal that ObamaCare offers them. And that’s precisely why ObamaCare’s supporters will try to kill HSAs. We will end up repealing one or the other.
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A Legal Analysis of the New Arizona Immigration Law
I’m a bit late to the immigration party — in part because I’ve been traveling on my Obamacare debate tour and in part because the Kagan Supreme Court nomination and end-of-term Supreme Court decisions have sucked away all my time. Still, I do have a few things to add beyond Dan Griswold’s excellent points about what real immigration reform would look like and why Arizona’s new law, love it or hate it, at least has the benefit of raising the need for such fundamental reform into the national political discussion. (Jeffrey Miron also offers some sensible suggestions, and Roger Pilon points out that doing nothing is simply not tenable as a matter of policy or politics.)
First, the Arizona law — which I’ve actually read, unlike the attorney general and the secretary of homeland security — is carefully crafted so as not to go beyond the scope of federal law and so, as Dan alludes in his thoughtful podcast (drawing on discussions with Roger), is probably constitutional. Here are the key things it does:
- Creates the new state crime of “trespassing by illegal aliens,” which essentially consists of being in the state in violation of federal immigration laws as determined by an officer or agency authorized by the federal government to verify immigration status;
- Sets out that no official or agency of the state or its political subdivisions (county, city, etc.) “may adopt a policy that limits the enforcement of federal laws to less than the full extent permitted by federal law;”
- State (and local) law enforcement officials shall make a “reasonable attempt … when practicable, to determine the immigration status” of any person with whom they have made “lawful contact … where reasonable suspicion exists that the [detained] person is an alien who is unlawfully present in the United States;”
- If an alien who is unlawfully in the United States is convicted of violating any state or local law [including the new “trespassing by illegal aliens”], the alien “shall be transferred immediately [on discharge from imprisonment or assessment of fine for the offense] to the custody of the [federal immigration authorities];”
- A police officer “may lawfully stop any person who is operating a motor vehicle of the officer has reasonable suspicion to believe the person is in violation of any civil traffic law and [the the pre-existing law against human smuggling];”
- Makes it illegal to stop to hire or pick up passengers for work if the vehicle “blocks or impedes the normal movement of traffic;”
- Makes it illegal for an illegal alien to knowingly apply for work, solicit work in a public place, or perform work as an employee or independent contractor;
- Makes it illegal for anyone violating the law (including the new illegal hiring law, as well as pre-existing prohibitions on hiring illegal aliens) to transport, move, conceal, or harbor persons who the alleged violator knows to be illegally in the United States, as well as to encourage or induce aliens to come to Arizona illegally;
- Provides an entrapment defense to the pre-existing crime of employing illegal aliens (whether knowingly or intentionally); and
- Authorizes the immobilization or impoundment of vehicles used to committ various vehicle-related offenses relating to illegal aliens.
None of these provisions, on their face, appear to be unconstitutional, in the sense of Arizona intruding on federal authority over immigration policy. Indeed, as reported last week by the Washington Post, this conclusion is backed by a 2002 memo from the Office of Legal Counsel — the Department of Justice unit that acts as the executive branch’s “outside counsel.” This memo concludes: first, that states have “inherent power” to make arrests for violating federal law and, second, “federal statutes should be presumed not to preempt this arrest authority.” OLC memos are not law themselves but they are the DOJ’s official position on various legal issue. Having said that, an OLC memo can at any time be withdrawn or replaced — as indeed the 2002 memo replaced an earlier 1996 memo on the subject (or, more famously, Jack Goldsmith withdrew the so-called “torture memos”). And, of course, Congress could pass a law saying states shall not enforce federal immigration laws.
Second, notwithstanding the new law’s facial constitutionality, state or local law enforcement officials could use it to behave in a way that intrudes on federal prerogatives or violates constitutionally protected individual rights. That circumstance could give rise to an “as-applied” legal challenge. If police officers stop Hispanic motorists on pretextual grounds just to ask for their papers, for example, that would constitute a Fourth Amendment violation. Notably, however, the sections relating to state enforcement of federal immigration laws contains a provision specifying: “This section shall be implemented in a manner consistent with federal laws regulating immigration, protecting the civil rights of all persons and respecting the privileges and immunities of United States citizens.”
Third, just because the law is constitutional doesn’t necessarily mean it’s good policy (just like not everything that some people say is good policy — like Obamacare, or torture during interrogations — is necessarily constitutional). There are many arguments against the Arizona law unrelated to civil liberties or racial profiling concerns, including that it misdirects state and local resources away from more pressing priorities (such as violent crime); that it’s driven by misguided fears of crime (when crime has actually been dropping in Arizona, and nationally the foreign-born commit crimes at lesser rates than the native-born); and that an “enforcement-first” mentality gets things backwards in that we should first reform and expand the ways people can come here legally and then take action against those who still come illegally. Similarly, there are many arguments in favor of the Arizona law not based in racism, or political opportunism, or misapplied economics.
Fourth, the boycotts of Arizona adopted by city councils around the country — at last count, Berkeley, Boston, El Paso, Los Angeles, Oakland, San Francisco, St. Paul, and West Hollywood have all passed resolutions restricting official travel, investment, and/or contracts with the Grand Canyon State — are likely themselves unconstitutional. That is, unlike private individuals, organizations, and businesses, states (and their political subdivisions) cannot erect barriers to trade against other states. Preventing such interstate discrimination was, of course, one of the original purposes of the Constitution and, specifically, its Commerce Clause (which grants Congress the power to regulate interstate commerce). We often discuss the Commerce Clause in terms of Congress incorrectly invoking it to justify legislation not having anything to do with either commerce or interstate activities — such as, again, the individual health care mandate — but just the same it protects economic liberty by forestalling trade wars. (Technically, the issue here is the “dormant” Commerce Clause in that cities are intruding on the boycott-less regime Congress has established by not passing boycott laws.) Lo and behold, Gary Pierce of the Arizona Corporation Commission sent a letter to L.A. Mayor Antonio Villaraigosa threatening to cut-off the 25 percent of its electricity that the City of Angels gets from its eastern neighbor. “I am confident that Arizona’s utilities would be happy to take those electrons off your hands,” the commissioner says. Stopping this sort of tit-for-tat silliness — along with being able to better muster national armies — is why we got rid of the Articles of Confederation.
In short, the Arizona immigration law presents a tremendously complex issue, as the Arizona Republic has recognized, that does not lend itself to easy calls or soundbites. I myself am not certain how I would have voted if I didn’t have the third option (as Arizona doesn’t) of imminent federal reform — to the disconsolation of state legislators around the country who have asked me what they can do to placate a (legitimately) aggrieved public besides enactiong Arizona-style laws.
President Obama and Congress, pass comprehensive immigration reform now!
Rand Paul and the ADA
Along with the rest, the Kentucky Senate candidate has come under fire for expressing some guarded criticism of the Americans with Disabilities Act in broadcast interviews. In particular, opponents have blasted Paul for getting some details about the law wrong in his off-the-cuff hypothetical example:
Let’s say you have a local office and you have a two story office and one of your workers is handicapped. Should you not be allowed maybe to offer them an office on the first floor, or should you be forced to put in a hundred thousand dollar elevator?
In fact ADA regulations specify that elevators will not be mandated for private buildings of “less than three stories” unless used for shopping, health care, or some other purposes. This leads Jed Lewison of Daily Kos, with the generosity of spirit toward opponents for which that site is known, to rant: “What an idiot… He has no idea what [the federal government] does. He’s like a toddler freaking out about monsters under the bed.” Right. Doesn’t everyone who gets asked about their position on the ADA on national TV know that the elevator cutoff begins at three stories, not two?
Associated Press reporter John Cook has followed up with a “Newsroom” blog entry pursuing the gotcha theme, and quotes me in the course of doing so. Since I might not have made myself sufficiently clear on the phone with Cook, let me try to have another go at it here.
Does the ADA ever mandate that a business install elevators in its three-story building? Yes, often it does, but typically not through its employment provisions, which, as federal guidance has made clear, seldom if ever require installation of an elevator as the requested “reasonable accommodation” for an individual worker. The other main branch of the ADA relevant here is the law’s architectural rules, which do not hinge on any calculation of reasonable accommodation to individual workers/users. Under these rules, so long as the owner of an older building leaves it alone without restoration, only “readily achievable” changes will be required, which will ordinarily not include elevator installation. Cook quotes spokespeople for the EEOC and DOJ who correctly deny — note the narrow wording, which may escape many readers — that elevators are required under the “reasonable accommodation” standard. And he quotes a court decision — again note the narrow ground — that elevator installation is not required under the “readily achievable” standard.
But where the rules on major improvements like elevators get their teeth — as some of Cook’s sources must surely be aware — is not from either of those standards, but from the rules that apply to new construction and, crucially, renovations of older spaces. Renovation, when not minor, triggers a requirement to bring the space up to broad ADA standards. This can easily result in elevators and other budget-busting outlays for the immediate benefit of perhaps a single employee or perhaps of no employees at all, since the requirements apply whether or not any disabled person has ever sought access to the space.
Next time federal agency spokespeople are asked about elevator mandates, I hope they address the renovation trigger rather than other, less relevant sections of the law. They might even want to check their own website (South Dakota restaurant owner “agreed to install an elevator” following complaint to the feds) or, amusingly, the Daily Kos site itself (contributor: “I was laid off from my job last November because the company I was working for was forced to install an elevator in their new building.”)
As I told Cook, I think it’s pretty common for Senators (let alone non-incumbent candidates) to display confusion about which provision does what in a complicated law. Last year Arkansas Senator Mark Pryor, defending the Consumer Product Safety Improvement Act of 2008 — a law he was himself instrumental in passing — claimed that “the law allows the CPSC to make ‘commonsense exceptions’ to anti-lead requirements.” It doesn’t, but the remark passed almost unnoticed since no gotcha narrative was running at the time.
If candidate Paul is looking for non-hypothetical examples of curious and untoward ADA applications, he might start here and here (restaurants), here (rugged hiking lodge), here (PDF, see p. 7 — resort accessible only on skis), or, on employment topics, here, here, or here. And thanks to Ira Stoll at Future of Capitalism, who cites my writing in responding to another critic of Paul, former Bush speechwriter Michael Gerson, who disputably appears to regard the ADA as among “the largest moral achievements of recent American history.”
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Rand Paul and Me in the Wall Street Journal
I’ve gotten some questions about these paragraphs in today’s Wall Street Journal (slightly shorter in the print version):
David Boaz, executive vice president of the libertarian Cato Institute, said that in many ways Americans are freer now than they were in any pre-1937 libertarian Halcyon day. Women and black citizens can vote, work and own property. “Micro-regulations” that existed before the Supreme Court shift, which controlled trucking, civil aviation and other private pursuits, are gone.
“Sometimes he talks the way libertarians talk in political seminars,” Mr. Boaz said of Mr. Paul. “There are not really many people who want to reverse Wickard, but there are many professors who could make a good case for it.”
Whenever a reporter takes a few sentences from an interview, some context is going to be lost. These quotations are accurate, but let me add some context. For a discussion of my view that we have not in fact followed a road to serfdom from a libertarian golden age, check out these blog posts and articles, as well as my book The Politics of Freedom.
When I said that Rand Paul “talks the way libertarians talk in political seminars” — and I should have said “philosophy seminars” — I was trying to make a distinction between the kinds of ideas that are commonly debated in classrooms and think tank seminars and those that are relevant to any particular political campaign. And my statement that there aren’t “many people who want to reverse Wickard” was in the context of a discussion about the tens of millions of Americans who believe in less government and more freedom, as noted here and here and here and, classically, here. I made the point that there were two great libertarian shifts in American politics and culture in my lifetime, the cultural/civil rights/women’s revolution of the Sixties and the entrepreneurial/economic/taxcutting revolution of the Eighties, and few people want to return either to the cultural strictures of the 1950s or the tax rates of the 1970s. And in that sense there’s a broadly libertarian center in American politics, and some of those people reacted against the excessive social conservatism (not to mention the over-spending and the endless wars) of the Bush Republicans in 2008, and are now reacting against the excessive statism of the Obama administration. But of course they’re not all as libertarian as I am, and not many normal people would recognize the term “Wickard v. Filburn,” much less call for its reversal. (On the other hand, pollsters should try asking voters, “Do you think the federal government should be able to tell a farmer what crops he can grow on his own farm for his own use?” I’ll bet more people would side with Rand Paul than with, say, the New York Times.) When Rand Paul gets back to talking about bailouts, deficits, debt, and Obamacare, he’s going to be appealing to many of those voters. And if his opponent accuses him of supporting medical marijuana, he’ll find that 81 percent of Americans agree. Sixty percent of Americans oppose federal mandatory minimum sentences for nonviolent crimes, as Rand Paul does. Paul has every likelihood of appealing to a broad swath of Americans who are broadly libertarian.
A Bum Rap for Limited Government
Every so often an editorial comes along that is so obtuse that you wonder if it came from human hand. I allude, not surprisingly, to the item in this morning’s New York Times, “Limits of Libertarianism,” which arises from the kerfuffle over Rand Paul’s critique of the 1964 Civil Rights Act for its undermining the private right to freedom of association.
The editorial’s main target, however, lies beyond the Paul senatorial campaign. It’s the tea party movement and its libertarian, limited government themes. But from the start the Times conflates limited government with anti government. They’re not the same. More broadly, the editorial shows beyond doubt that the Times, ever the friend of “enlightened government,” finds danger lurking mostly in the private sector. (One wonders just how it is that those not-to-be-trusted private actors become so quickly enlightened once they get their hands on monopoly government power.)
Thus, we’re told that the libertarian theory of private liberty has “roots in America’s creation, but the succeeding centuries have shown how ineffective it was in promoting a civil society.” Really? What history have the scribes at the Times been reading? Their next line, presumably supporting that claim, only compounds the mystery: “The freedom of a few people to discriminate meant generations of less freedom for large groups of others.” Is that what slavery was, private discrimination, to be corrected by government?
Apparently, because following immediately is the editorialists’ main point: “It was only government power that ended slavery and abolished Jim Crow, neither of which would have been eliminated by a purely free market. It was government that rescued the economy from the Depression.”
Where to begin. Skip the Depression point; it’s been so often refuted that one does so again only with embarrassment for its authors. The first claim, however, warrants more than passing attention. Contending that only government power saved us from slavery and Jim Crow, it ignores the role of private power – the abolitionists, and the civil rights movement – that brought about that government power. More important, it invites us to believe that government had little or nothing to do with slavery and Jim Crow in the first place when in truth we would have had neither without government’s creation of those legal institutions, with legal sanctions that kept them in place. Indeed, it is limited government, government limited to securing our rights, that is the surest guarantee against those twin evils.
The Anti-Defamation League and Private School Choice
In another of many recent signs that liberal and Democratic attitudes toward private school choice are changing, the Philadelphia branch of the ADL voted 13–4 this year to reject the national organization’s longstanding opposition to choice.
A core principle undergirding the ADL’s (and ACLU’s) longstanding opposition to school vouchers is that:
Proponents of vouchers are asking Americans to do something contrary to the very ideals upon which this country was founded. Thomas Jefferson, one of the architects of religious freedom in America, said, “To compel a man to furnish contributions of money for the propagation of opinions which he disbelieves… is sinful and tyrannical.”
Though the evidence has led me to strongly support private school choice, I am very sympathetic to this concern. Fortunately, there is a way to ensure universal access to a free educational marketplace without compelling citizens to pay for instruction that violates their convictions: education tax credits. Since the late 1990s, several states have enacted scholarship donation tax credit programs. Under these programs, businesses or individuals make donations to non-profit organizations that then subsidize tuition for the poor. The donor receives a dollar-for-dollar tax credit offsetting the value of the donation.
When properly designed, as in Pennsylvania for example, these programs lead to the creation of many different kinds of tuition-granting organizations: secular, Jewish, Protestant, Catholic, Muslim, etc. If they wish, taxpayers can choose to donate to none of them. But if they do make a donation, they can choose the organization most consistent with their values. Similarly, parents seeking tuition assistance can approach whichever tuition-granting organization most closely matches their own beliefs and preferences. In this way, private school tuition assistance is made available through an entirely voluntary process. (Of course, those who do not donate to scholarship-granting organizations must still pay their taxes. Those are not voluntary).
This system is not simply better than vouchers at avoiding “sinful and tyrannical” ideological compulsion, it is better in this regard than our conventional public school system. Liberals in Dallas and conservatives in San Francisco must pay for public school systems whose content is often at odds with their own convictions. Conflicts over the content of public schooling have been the inevitable result — dating back to the very origins of state control over schooling in the mid 1800s. Education tax credits expand parental choice while avoiding the compulsion that breeds these conflicts. No one protests today over what is taught in Catholic schools or yeshiva ketanas.
On top of this powerful civic advantage, tax credit programs have grown much faster than voucher programs. And building on existing programs such as Pennsylvania’s Education Improvement Tax Credit is generally much easier than introducing new programs of any kind.
Perhaps the national ADL organization will take these facts to heart. Either way, the tide is clearly turning.
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Why Not Try Term Limits?
Bob Bennett has been in the U.S. Senate for 18 years, not quite as long as the 24 years his father spent in the Senate. Arlen Specter has been in the Senate for 30 years. Rep. Alan Mollohan has been in the House since 1982, when he took over the seat his father had held since 1968. Sen. Blanche Lincoln told NPR this morning that she’s been trying to change Washington ever since she got here in 1992.
Do all of these folks really believe there’s no one else in Utah, Pennsylvania, West Virginia, or Arkansas capable of serving in Congress? Quite aside from the wars, bailouts, health care takeovers, and earmarks that have angered these officials’ constituents, there’s a good case for rotation in office. Cato analysts have been making the case for term limits for some two decades. The argument doesn’t seem to have gotten any weaker in the interim.
One of America’s Founders, George Mason, made the case for rotation in office:
Nothing is so essential to the preservation of a republican government as a periodical rotation. Nothing so strongly impels a man to regard the interest of his constituents, as the certainty of returning to the general mass of the people, from whence he was taken, where he must participate in their burdens.
It looks like the voters intend to rotate a lot of politicians out of office this year. But why should it take trillions of dollars of debt and millions of dollars of campaign spending to get some new thinking in Congress? Why not make rotation in office the law?