I’ve wondered why state governors and legislators haven’t been more vocal opponents of the healthcare reforms being drawn up in Washington.  All these proposals would put huge financial burdens on the states.

I haven’t seen much in the news until this article appeared, reporting that two Florida state senators are proposing that the state examine dropping out of the Medicaid program (which is jointly funded by the federal and state governments) and starting a state-only program to replace it.

The story appeared in the Lakeland Ledger and as far as I know hasn’t been picked up by other papers.  Perhaps it will be in the next few days.

I’d like to see the story get lots of publicity, and I’d like to see state legislators in other states jumping on this bandwagon.  (OK, it’s not a bandwagon yet, but it could become one.)  I’m amazed that with Congress trying to place such a huge financial burden on state governments in their proposed healthcare reforms there hasn’t been more vocal resistance by state governments.

Congress is telling the states, “We’re going to design a healthcare reform, but we’re going to make you pay a substantial amount of the cost.”  Are state legislatures really so passive that they are content to let people in Washington dictate how a big chunk of their revenues will be spent?

As cities across the country face growing deficits, instead of their current strategy of raising taxes and cutting services, they might like to take a look at a few case study examples of how those before them solved their challenges.

As an example, ten years ago we hosted the then-mayors of Indianapolis, Stephen Goldsmith, and Oakland, Jerry Brown, at the Independent Institute’s conference center to discuss some creative ideas. Stephen Goldsmith had been elected mayor of Indianapolis—with a population of 900,000, 25% of it African-American—only to discover the city had a billion dollar deficit. He shared the steps he took that successfully turned that situation around. Excerpts follow:

Mayors get elected, they have lots of problems of poverty and urban decay. They’re intent on doing good deeds. In order to do the good deeds, they need money. So they tax the people who have it in order to redistribute it to those who don’t.

Now, this process was particularly aggressive east of the Mississippi, where essentially mayors taxed their way further into poverty. And my office is on the 25th floor of our City County building and on a very bright, clear day I can see dollar bills float across the city line and land in the suburbs, where the tax rate is less, the regulatory burdens are less, the crime rate is less and the schools are often better.

So we had this dynamic, a lot of people were moving out of the city, the tax rates were too high, the infrastructure was decaying, and it was clear that we really couldn’t continue to do business the way we had done it. I then began to look at ways to change the way government functions.

Mayor Goldsmith started his term by going around and doing a different city job each week. In the process, he learned that

the theory that public employees are inherently inferior to private employees is really not fair. Public systems are inherently inferior to private systems because they lack competition—they’re monopolies and bureaucracies and the people are trapped in those systems. So I wanted to see what I could do, structurally, to unlock these systems, to unlock the power of competition, to help the people who really wanted to do a good job perform better and buy the best I could from the private marketplace at the same time.

So we began this effort that we call marketization or competition. And we’ve done 80 of these. Without taking you through them all, let me just say the concept basically is: competition produces value and makes for more efficient delivery of public services. And we then created this model to let our public employees bid against the private sector.

So I reached an agreement on our labor contract and said, “I won’t privatize but I am going to submit a number of these transactions to the marketplace. You have a 90-day window in which to bid. We’ll provide you consultants. We’ll provide you help, but we want you to bid.”

In one example—fleet management—the union and their consultants figured out how to get rid of two-thirds of their own managers. They contracted out custodial service. They froze their wages. And as workers retired, they decided they didn’t need to fill the now-vacant positions. Bottom-line: they were able to submit a bid that won out over the private competition, and:

So we’ve now been through 80-plus of these, saved $400 million. And this effort is really not the end, obviously. The end is a higher quality of life for city residents. This was a way of freeing up capital to invest in either reducing taxes, more police officers, infrastructure, as the situation may be.

Mayor Goldsmith also learned:

Regulatory reform is important, as well. We fought the licensing issues and the permitting issues and the cab cartel issues…I had the Republican Council against me, the Democratic Council for me, and the NAACP on my side, because basically they were saying, “Our citizens are under served and we have a lot of folks who want to go in this business. And why is it the government is prohibiting small and minority-owned businesses from having an opportunity for enterprise in this community?

This was kind of a classic free market fight, one that we had actually lots of opposition and great fun in fighting and eventually won, and predictably, as the work of The Independent Institute would suggest, urban service went up; 60 new operators came into the marketplace, many of them moms and pops, and the configuration of services changed once the cartel was removed.

For the complete presentation, see here.

And for more creative ideas, see The Voluntary City: Choice, Community, and Civil Society

How many jobs has the “stimulus” package created? Sensible economists of course know this question cannot possibly be answered. Government spending directs resources toward politically favored projects at the expense of others, but the net effect on resource allocation, including the net effect on “jobs” — a heterogeneous category that depends on hours worked, job characteristics, and other small details — cannot be measured with precision. There are also important intertemporal effects — e.g., expectations of inflation, tax increases, new government programs, etc., may cause firms to delay hiring workers they otherwise would have hired.

Not to worry, says John Irons of the Economic Policy Institute. Indeed, the Obama Administration’s silly attempt to count “jobs saved” may actually underestimate the beneficial effects of stimulus, because “that construction worker [hired by stimulus funds] then goes out and spends money at a local diner, at a local McDonald’s or the local movie theater. That could very well mean an additional job.” Well, yes, but there’s the construction worker who wasn’t hired because investors, spooked by regime uncertainty, wouldn’t fund the construction project; the construction worker who won’t be hired tomorrow when taxes are hiked to pay for today’s stimulus; the construction workers who will sit idle at home when hyperinflation destroys the construction industry; and many other members of Bastiat’s “unseen” who would have spent money at diners and McDonald’s and movie theaters. But we never see those lost jobs, so — poof! — they don’t exist, and shouldn’t be counted against the free lunches wished into existence by Stimuluspalooza.

Update: My colleague Mike Sykuta beat me to it.

In Newsweek, November 16, 2009, p. 20, Fareed Zakaria says, “There are two general health-care crises in America — one involving coverage and the other cost.  The Obama plan appears likely to tackle the first but not the second.  This is bad economics but also bad politics: the crisis of cost affects 85 percent of Americans, while the crisis of coverage affects about 15 percent.  Obama’s message to the country appears to be ‘We have a dysfunctional health-care system with out-of-control costs, and let’s add 45 million people to it.’”

In Newsweek, November 23, 2009, p. 21, Robert J. Samuelson criticizes President Obama for saying the proposed health care reform will control costs and reduce government spending as government-financed health care is extended to millions of additional people.  He says, “The disconnect between what Obama says and what he’s doing is so glaring that most people could not abide it.  The president and his allies have no trouble.  But reconciling blatantly contradictory objectives requires them to engage in willful self-deception, public dishonesty, or both.”

One might expect criticisms like this from Glenn Beck or Sarah Palin, but these criticisms appeared in Newsweek, which advertises its pro-government bias.  Speaking of Sarah Palin, the cover of the November 23 edition in which Samuelson’s column appears features a photo of her (looking very good in her jogging atire) with the caption, “HOW DO YOU SOLVE A PROBLEM LIKE SARAH?  SHE’S BAD NEWS FOR THE GOP — AND FOR EVERYBODY ELSE TOO.”  And just a few weeks ago the cover featured a photo of Al Gore, with the caption, “THE THINKING MAN’S THINKING MAN.”

When Newsweek, a magazine that promotes it’s pro-government, and pro-Democrat, bias, is running columns critical of Obamacare, that suggests that its shortcomings are recognized across the political spectrum.  These aren’t just minor criticisms either.  Zakaria says the Obama plan would add to “a disfunctional health-care system with out-of-control costs,” and Samuelson accuses President Obama of “willful self-deception, public dishonesty, or both.”

The question then is: if it is so easy to see the faults, why does Obama, and his party, keep pushing something so obviously flawed.  The only answer I can think of is politics.  They said they were going to pass health care reform, they ran on that platform, and now they are determined to do it despite the widespread recognition that if they succeed the outcome will make the nation worse off.

Bob Barr, David Keene and Grover Norquist have called for civilian trials of terror suspects, and urged that the “scaremongering about these issues has to stop.”

There are problems with civilian trials, of course. Many detainees were freed by Bush’s extralegal system who would have likely been convicted and be sitting in prison right now. And should New York courts really try some of these cases – that don’t involve “terrorism” at all, but simply fighting back against military forces in the Afghanistan war?

A few weeks ago a 16 year old high school girl was gang-raped for a period of over two hours in a poorly-lit courtyard on the campus of her high school during the homecoming dance. While there have been outpourings of horror, sympathy for the victim, funds raised for her future, etc., I’ve seen absolutely no call anywhere for holding the school officials accountable. On the contrary, local media has accepted and reported the crime as “nearly inevitable:”

Charles Johnson, one of the high school’s security specialists said, “We know that courtyard, and we’ve been waiting for something to happen there.”

When we were raising teenagers, not so long ago, it was drilled into us that anything that happened at our home was our responsibility: if a kid got drunk or high at our house and drove drunk, we would be liable, and we took appropriate precautions. Of course, I’m not naive enough to think that nothing slipped by us, but it is inconceivable that we would have had chaperones or security insufficient at a school dance to be unaware of 10-20 boys drinking heavily and assaulting a young woman for more than two hours in a well-known hangout on campus.

Yet such now seems to be the accepted standard for public schools—from a mother telling me about her grade-school child who doesn’t drink anything at school because she’s afraid to go into the bathroom there, to our neighborhood’s high school newspaper routinely reporting on muggings on campus—imparted impassively, shrugging shoulders, as if to say, “That’s the way it is and that’s the way it has to be.”

There’s a very real alternative to continuing to moan and wring hands and call for government to “do something.” We see it in examples like neighborhood watch programs, and more dramatically, the Guardian Angels. In Baltimore, “Grandmothers Against Gangs” was formed; when they saw a bunch of kids selling drugs on street corners, they ran out with brooms to chase them away. In Oakland, residents of one of the poorest and worst neighborhoods decided to take back their street by gathering every Friday night to talk and drink coffee on a corner that used to be ground-zero for drug and sex deals. In each of these instances, crime in the areas dropped: criminals go somewhere all those people—largely poor people, armed only with red berets, coffee mugs or brooms—aren’t.

When the school administration and its “security specialists” can blithely declare that they were sitting idly by, “waiting” for this to happen, it’s time to wrench responsibility, funding, and authority from these hired “experts,” and take it for ourselves: It’s time to reassert control over our own neighborhoods, schools and kids. It’s time for parents, grandparents, siblings, neighbors, merchants, and/or church leaders to organize citizen patrols of the public schools: patrolling halls, bathrooms and the campus to establish the environment we want for our children.

We might also learn some lessons from the exercise that we decide to apply in other areas of our lives: a forgotten legacy of how we used to rely on mutual-aid and voluntary associations to address these and worse problems, with great effectiveness (see, for example, The Voluntary City)—before we allowed the government to convince us that we needed “them” to keep us safe. See also, Neither Liberty Nor Safety.

“That government is best which governs not at all,”

Said Henry David Thoreau,

But what did he know?
_______________________________________________

“Liberty:  not the daughter but the mother of order,”

Declared Pierre-Joseph Proudhon,

And then he passed on.
_______________________________________________

“When the government is too intrusive, people lose their spirit,”

Noted Lao-tzu,

As I would, too.
_______________________________________________

“Great men are almost always bad men,”

Declared Lord Acton

―some wisdom to act on.
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“Let us strangle the last king with the entrails of the last priest,”

Urged Denis Diderot.

―an extreme to which I will not go.
_______________________________________________

“Nothing is so prone to contaminate―under certain circumstances, even to exhaust―the source of all noble and ideal sentiments, which arise of themselves from normally developing sexual instinct, as the practice of masturbation in early years,”

Wrote Richard von Krafft-Ebing,

As he felt his sexual powers ebbing.
_______________________________________________

“Loyalty, decency, compassion, love―these are . . . irremediable, crippling flaws in a professional politician,”

Declared Erik Tarloff,

And then he ran off.
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If, all things considered, there is a national profit in increasing the size of the army, why not call the whole male population of the country to the colors?”

Asked Frédéric Bastiat.

So, in World War II, the Keynesians tried that.
_______________________________________________

“Our government makes no sense unless it is founded on a deeply felt religious faith―and I don’t care what it is,”

Declared Dwight D. Eisenhower,

A man of scant theological power.
_______________________________________________

“The Powers That Be literally stand on their dignity. Nothing deflates them more effectively than deft lampooning,”

Wrote Walter Wink.

An apt observation, I think.
_______________________________________________

“I beseech you, in the bowels of Christ, think it possible you may be mistaken,”

Cried Oliver Cromwell,

Several years before his dead head fell.
_______________________________________________

“Man, therefore, is a curious, dreamy, humourous and wayward creature,”

According to Lin Yutang,

Who wrote but never sang.
_______________________________________________

“There are two kinds of men and only two. / There’s the one staying put /In his proper place / And the one with his foot / In the other one’s face.”

Sweeney Todd knew

A thing or two.
_______________________________________________

“You can’t kill ideas. But you can sure shoot the people who hold them,”

Noted G. Gordon Liddy

―a statement both true and witty.
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“Whatever the State saith is a lie; whatever it hath is a theft: all is counterfeit in it, the gnawing, sanguinary, insatiate monster,”

Wrote Friedrich Wilhelm Nietzsche;

To which a wise Norwegian replied, “You betcha.”
_______________________________________________

“In the absence of justice, what is sovereignty but organized brigandage?”

Asked St. Augustine rhetorically.

And I affirm categorically.
_______________________________________________

“A politician who is poor is a poor politician,”

According to PRI wheeler-dealer Carlos Hank González,

Who put other people’s money where his mouth was.
_______________________________________________

“If the U.S. government were a private security agency, it would be fired and sued,”

Declared Llewellyn H. Rockwell.

Lew, said a government spokesman, can go straight to hell.
_______________________________________________

“Organized crime, or even outright terrorism, can do far less harm than the most well-meaning government. It’s a matter of power, not intentions,”

Wrote Joseph Sobran,

Obviously a wise man.
_______________________________________________

“[O]f course, the people don’t want war,”

Said Hermann Goering,

Who was known as overbearing.
_______________________________________________

“Men commit evil within the scope available to them.  . . .  They do what they can get away with,”

Wrote Theodore Dalrymple.

It’s just that simple.
_______________________________________________

“[I]t is a false deduction that one thousand human beings are worth more than one; that would be tantamount to regarding men as animals. The central point about being human is that the unit ‘1′ is the highest; ‘1000′ counts for less,”

Declared Søren Kierkegaard,

A man for whom I’d name a boulevard.
_______________________________________________

“The formula is simple: Keep’em scared and you can do anything. It works,”

Said Fred Reed

―true words, indeed.
_______________________________________________

“I’m not afraid
they’ll stamp me flat.
Grass stamped flat
soon becomes a path.”

Wrote the poet Blaga Dimitrova.

Don’t say I never told ya.
_______________________________________________

“The great are great only because we are on our knees.”

Observed Max Stirner,

A fast learner.

George W. Bush is launching a free-market think tank. The Washington Times reports:

With the Obama administration establishing far-reaching controls in the auto, real estate and financial sectors, Mr. Bush said that “the role of government is not to create wealth, but to create the conditions that allow entrepreneurs and innovators to thrive.”

So the guy who began the auto bailouts, whose federal “Ownership Society” was key in creating the biggest speculative bubble in memory, who had bragged in 2004 for having “passed the strongest corporate reforms since Franklin Roosevelt,” who trashed the Bill of Rights, inflated the welfare state and expanded government faster and in more directions than any president since Vietnam, if not since World War II — this guy is now promoting free markets and criticizing big government? This would be obscene if it weren’t so laughable.

Senator Jack Reed (D-RI) was asked “Specifically where in the Constitution does Congress get its authority to mandate that individuals purchase health insurance?”  He couldn’t cite a specific section, but noted that Congress has required individuals to do lots of things in the past.

As a practical matter, Senator Reed is right.

Originally, the Constitution created a federal government with a limited set of enumerated powers, and the Tenth Amendment says, “The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.”  Today, the Tenth Amendment is irrelevant and the idea of the federal government having a limited set of enumerated powers is laughable.

Where in the Constitution did Congress get its authority to force people into a compulsory retirement program, as Social Security does?  The Supreme Court’s ruling that Social Security is constitutional would appear to close the door on any notion of enumerated powers, or to reserving powers to the states or the people.

But Senator Reed came up with an even better example when he said “it is not unusual that the Congress has required individuals to do things, like sign up for the draft.”  This is a great example because the Thirteenth Amendment to the Constitution says, “Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States.”  The draft pressed people into involuntary servitude despite the Constitution’s explicit prohibition.

It has already been established that Congress has gained the authority to pass legislation that violates explicit provisions in the Constitution, as Senator Reed notes, so it is not surprising that the Senator would find the Constitution sufficiently irrelevant to the health care issue that he would not have — or need to have — an answer to the question.

Women’s rights were always a main argument behind invading and occupying Afghanistan. Now Malalai Joya, a female member of the Afghan Parliament, has called on Obama to withdraw:

Eight years ago, women’s rights were used as one of the excuses to start this war. But today, Afghanistan is still facing a women’s rights catastrophe. Life for most Afghan women resembles a type of hell that is never reflected in the Western mainstream media.

In 2001, the U.S. helped return to power the worst misogynist criminals, such as the Northern Alliance warlords and druglords. These men ought to be considered a photocopy of the Taliban. The only difference is that the Northern Alliance warlords wear suits and ties and cover their faces with the mask of democracy while they occupy government positions. But they are responsible for much of the disaster today in Afghanistan, thanks to the U.S. support they enjoy.

The U.S. and its allies are getting ready to offer power to the medieval Taliban by creating an imaginary category called the “moderate Taliban” and inviting them to join the government. A man who was near the top of the list of most-wanted terrorists eight years ago, Gulbuddin Hekmatyar, has been invited to join the government.

Read the rest.