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20 March 2010

Today’s Tabbloid


CBO: ObamaCare Would WWJC? [Cato at Liberty]

MAR 19, 2010 05:50P.M.
Increase Deficits by $59 Billion
By Michael F. Cannon
[Cato at Liberty]
MAR 19, 2010 05:52P.M. Or, whom would Jesus coerce? That’s the question that comes to mind
when I read the Center for American Progress’ latest attempt to argue
By Michael F. Cannon that, if Jesus were a member of Congress, He would vote for President
Obama’s individual mandate.
Of course, it depends on what the meaning of “the Obama health plan”
is. I was raised Catholic, and I don’t remember Jesus teaching that we
should put people in jail for not buying health insurance. As I recall, He
If the Obama plan is understood not to include the $208 billion let the priest and the Levite go their merry ways.
Medicare “doc fix” that the House removed from its bill to pass
separately, and if the Obama plan would be sealed in an impenetrable OK, technically all the CAP report claims is that the Obama plan is
vault within the National Archives, never again to be touched by God or consistent with Catholic social teaching.
man, then yes, the Congressional Budget Office predicts the Obama plan
would reduce federal deficits by $138 billion over the next 10 years and The authors invoke all the right Catholic doctrines: “human dignity,
by maybe one-half percent of GDP in the 10 years after that. solidarity, special status of the poor … concern for the common good …
stewardship.” Except they omit the Catholic doctrine of subsidiarity,
If, however, the doc fix is actually part of the Obama plan, and that law which teaches that problems should be addressed at the most local level
would be subject to normal political forces plus the new political possible.
dynamics the law would create, then the CBO predicts the Obama plan
would increase federal deficits by $59 billion over the next 10 years and They left out what Pope John Paul II wrote about the welfare state in a
maybe one-quarter percent of GDP in the subsequent decade. 1991 encyclical:

So really, the Obama plan’s impact on the deficit comes down to which By intervening directly and depriving society of its
one of those scenarios best describes the Obama plan, and which one is a responsibility, the Social Assistance State leads to a loss of
partisan fantasy. human energies and an inordinate increase of public agencies
which are dominated more by bureaucratic ways of thinking
than by concern for serving their clients and which are
accompanied by an enormous increase in spending.

They sidestep the small matter of whether the legislation would actually
force taxpayers to finance abortions, which Catholic doctrine teaches is
the taking of innocent human life.

They note that “the Catholic Health Association is the largest provider of
nongovernmental health care in the United States,” and the CHA has
essentially endorsed the Obama plan. They do not mention the material
fact that the CHA therefore depends on the government for much of its
revenue, and is susceptible to retribution if it doesn’t play ball.

But I keep coming back to the absurdity of suggesting that using

government coercion to achieve social change is the Christian thing to
do. The authors do not channel Christ so much as Richard III:

Today’s Tabbloid PERSONAL NEWS FOR 20 March 2010

And thus I clothe my naked villany • Tax Bases. The addition of new tax bases provides the means of
With old odd ends stolen forth of holy writ, government expansion. The best example is the addition of the
And seem a saint when most I play the devil. federal income tax in 1913, which fueled huge government growth
in subsequent decades. This can be called “feeding the beast.”
Or to put it differently, they cast their lots with Caesar, not Christ.
• Ideology. The rise of populism and progressivism during the late
19th and early 20th century broke down the traditional American
resistance to big government.
I would add an additional cause of growth: legislative precedent.
Full List of Backroom Health Politicians push the envelope on their allowable powers, and they build
on the power grabs of prior policymakers. This is evident, for example,
Deals in “Deem and Pass” when you look at the steady destruction of federalism over the last
century due to the growth in federal aid to the states.
Healthcare Bill [Americans for
In the 19th century, presidents routinely vetoed legislation that provided
Tax Reform] subsidies to state and local governments. But subsidy advocates started
MAR 19, 2010 03:15P.M. gaining traction in the 1910s with the enactment of a series of new aid
programs. The 1916 Federal Aid Roads Act, for example, was an early
(This content originally appeared on “These negotiations will “matching” grant, whereby the federal government gave states higher
be on C-Span, and so the public will be part of the conversation and we’ll subsidies the more they spent.
see the choices that are being made.” ...
What started as a trickle became a flood as federal politicians found that
they could use state aid to cater to an array of special interest groups that
they previously had no access to, such as teachers. The matching idea
FISCALLY CONSERVATIVE BLOG FEEDS was copied in dozens of other aid programs, and it has helped to propel
Medicaid spending through the stratosphere.
Precedents in Government
The health care bill being pushed through Congress contains a number of
Growth [Cato at Liberty] dangerous legislative precedents, such as the mandate to purchase health
MAR 19, 2010 03:14P.M. insurance. I’m astounded that members of Congress think it’s OK to use
government power to force Americans to buy a certain product, or else
By Chris Edwards face stiff fines. Where did they get such an outrageous idea? Well, from
the precedent set by Mitt Romney’s Massachusetts health bill of 2006.
As an opponent of government growth, I’m interested in what we can
learn from history to help us reverse the trend going forward. We need to If the current health legislation passes, we can sadly expect politicians to
understand the mechanisms of government growth if we are to combat pursue the mandate approach further. Will mandatory broadband be
the disease. next? That sounds crazy, but with the Treasury empty, politicians are
looking for ways other than spending to impose their will on the people.
In a new Federal Reserve Bank of St. Louis article, Thomas Garrett and
coauthors provide a useful overview of explanations for the federal With the health care mandate, Congress is crossing the Rubicon,
government’s historical growth. They note that while the economic breaking another traditional restraint on government and ramping up its
depression of the 1930s helped boost the size of the government, the war on individual rights.
severe recession of the 1890s did not do so. What was the difference
between the 1890s and the 1930s?

The authors identify a number of factors that paved the way for
sustained federal growth beginning in the 1930s:

• Path Dependency. Governments have inertia such that once a

program is in place it is difficult to remove. When new programs
are added during crises, they take root and aren’t cancelled when
the crisis passes. Thus, government programs tend to accumulate
over time.

Today’s Tabbloid PERSONAL NEWS FOR 20 March 2010

FISCALLY CONSERVATIVE BLOG FEEDS all the time, the strategies for approximating that desired state vary
considerably in their effectiveness. The best is the one most famously
“What Do You Do, Sir?” [“Cato touted (though not necessarily followed) by John Maynard Keynes:
“When the facts change, I change my mind. What do you do, sir?” The
at Liberty”] sooner we adopt an education system that is actually effective and
MAR 19, 2010 01:41P.M. efficient, the sooner people can stop being wrong defending the current
profligate monopoly.
By Andrew J. Coulson

Brandon Dutcher of the Oklahoma Council of Public Affairs recently

wrote a commentary for The Oklahoman featuring (in the print FISCALLY CONSERVATIVE BLOG FEEDS
edition) a chart I created of percent change in the state’s ACT scores and
per pupil revenues over time. (Hint: one line’s pretty flat, the other goes This Week in Government
up lots.)
Failure [Cato at Liberty]
Some folks didn’t like what this chart reveals, and so offered a variety of MAR 19, 2010 01:32P.M.
excuses for it in today’s letters to the editor. I’ve just responded with a
letter to the editor of my own, reproduced here: By Tad DeHaven

It is an unfailing characteristic of human nature that, when Over at Downsizing Government, we focused on the following issues this
faced with evidence undermining their accomplishments or week:
beliefs, people look first to excuses in the hope of deflecting
the blow. So it’s no surprise to see a letter to the editor • Another day, another cost overrun at the Pentagon. This time it’s
discounting Oklahoma’s relatively flat ACT scores despite the Joint Strike Fighter.
rising spending on the grounds that the ACT “was never
meant” “as a tool for evaluating the success of the common • Office of Personnel Management director John Berry has a hissy fit
education system.” The only problem with this claim is that over Cato shining a light on excessive wages and benefits for
it’s absolutely false. According to the official ACT government employees at a time when the private sector is
publication ”The Sensitivity of the ACT to Instruction“: bleeding jobs.

Consistent with [its co-founder’s] intent, the ACT is an • Nationalizing federal higher education subsidies is still a loser for
educational achievement test that measures the typical taxpayers. The best solution is to get rid of them altogether.
content and skills learned from college preparatory
curricula. Consequently, the ACT can … provide direct • Sugar subsidies aren’t so sweet for consumers and manufacturers
feedback to high school teachers about the effectiveness of who use it in their products.
their teaching.
• The only way to stop ACORN from getting taxpayer money is to kill
Another excuse offered for Oklahoma’s education the programs that fund it.
productivity collapse is that student achievement is limited
while “the amount of money that can be potentially spent on • Greece is turning to privatization to help solve its debt problems.
education has no limit.” Oklahoma taxpayers will be pleased The U.S. should do the same.
to learn they have limitless financial resources, but this is no
defense of the status quo. If it was foolish to think in 1990
that spending 40% more on a state monopoly school system
would substantially improve student learning, then the same
is presumably true today. That, it seems to me, was the point
of Mr. Dutcher’s op-ed.

To answer that same letter-writer’s question about the initial

year of comparison for the chart’s percent change
calculations, it is 1990 (as could have been surmised from the
fact that the reported changes for 1990 are both zero).

That’s the end of my letter, but I can’t help adding an observation that
would have exceeded the word count. While everybody likes to be right

Today’s Tabbloid PERSONAL NEWS FOR 20 March 2010


Tennessee Takes Heat for ATR Will Double-Rate A Vote

Proposing Tax on Free AGAINST Rule “Deeming”
Breakfast [Americans for Tax Senate Health Bill As Passed
Reform] [Americans for Tax Reform]
MAR 19, 2010 01:19P.M. MAR 19, 2010 11:52A.M.

We’re used to legislators proposing all kinds of crazy-tax hikes to make This Sunday, the U.S. House of Representatives will be voting on a
up for their overspending, but at times even we are surprised. And this is budget reconciliation bill. The contents of that bill, while damaging to
one of those times. Tennessee legislators have prop... the economy, are secondary in importance to the rule w...


Weekend Links [Cato at The FTC on Steroids: Will the

Liberty] ‘National Nanny’ Take Over the
MAR 19, 2010 12:47P.M.
Internet and the New
By Chris Moody
Information Economy? [Cato at
• Michael Cannon exposes and corrects seven myths about the health
care overhaul. Liberty‘National Nanny’ Take
• The real problem with the American health care system: Nearly Over the Internet and the New
nine of ten medical dollars is paid in the first instance by someone
else. When you don’t have skin in the game, there’s little incentive Information Economy?]
to keep costs down. MAR 19, 2010 10:53A.M.

• GOP Reps say that most Republicans in Congress now think the By Jim Harper
Iraq War was a mistake.
Writing on the TechLiberationFront blog, Berin Szoka warns of the
• “In sheep’s clothing”…how to spot a politician who calls himself a extensive Internet regulation that could come with huge grants of
libertarian, but is really just another conservative. authority to the Federal Trade Commission in H.R. 4173, the “Wall Street
Reform and Consumer Protection Act of 2009.”
• Podcast: “Transparency Suffers in Health Care Fight” featuring Jim
Harper. Congress is about to reinvent the FTC as the “National
Nanny” it was well on its way to becoming back in the 1970s.
Today, the FTC is not merely the general overseer of our
economy, but the key regulator of the Internet. If the Senate
passes Rep. Frank’s bill with its so-called “improvements” to
the FTC Act, future generations will look back and wonder
why, without even taking the time to consider what it was
doing, Congress radically transformed Internet governance as
an afterthought to financial regulatory overhaul.

Today’s Tabbloid PERSONAL NEWS FOR 20 March 2010

FISCALLY CONSERVATIVE BLOG FEEDS I’ll parse the senators’ description of their national ID plan here. In a
later post, I’ll examine how the Schumer-Graham biometric national ID
Schumer and Graham on stacks up in terms of privacy, cost, and other considerations. Of course,
in the decade or two it will take to build this extravagant national
Immigration Reform: Why Not identity system, we will learn much more than I can predict.

Do it Without the Biometric We would require all U.S. citizens and legal immigrants who
want jobs to obtain a high-tech, fraud-proof Social Security
National ID? [Cato at Liberty] card.
MAR 19, 2010 09:45A.M.
First, let there be no doubt that this is a national ID card. As I’ve written
By Jim Harper in past, a national ID has three characteristics: It is national—this is. It’s
practically or legally required—this is. And it’s for identification—yep.
There is much to commend in the op-ed on immigration reform that
Senators Chuck Schumer (D-NY) and Lindsey Graham (R-SC) published Students of card security will recognize one of the adjectives in the
in this morning’s Washington Post. Unfortunately, they lead with their sentence as rather extravagant. No, it’s not “high-tech”—that’s a
worst idea: a biometric national ID card, mandatory for all American throwaway. The extravagant claim is “fraud-proof.”
The senators may mean one of three things, only one of which might be
Here’s the good: “Americans overwhelmingly oppose illegal immigration true. All three have to be true or their implication of a bullet-proof card
and support legal immigration,” they say. “Throughout our history, system is false:
immigrants have contributed to making this country more vibrant and
economically dynamic.” 1) Impervious to fraud in issuance. Issuance is the weakest link in card
security. Today at the hundreds and hundreds of DMVs across the
Their plan includes problem-solving proposals: “creating a process for country, ingenious young people (under 21—understand their
admitting temporary workers” and “implementing a tough but fair path motivation?) regularly submit identity documents falsely—siblings’ birth
to legalization.” The latter would reduce the population of illegal aliens in certificates or driver’s licenses, for example, or fake Social Security cards,
the U.S.—good—and the former would reduce the need to enter illegally utility bills, and such. Illegal aliens do too. Many DMV workers are gulls.
in the first place—also good. Some can be made willing gulls for the right price. The same will be true
of Social Security Administration workers. If the motivation is high
Joined with the enhanced border security they propose, these ideas enough, there is no practical way of making a national identity document
would address the immigration challenge as well as anyone knows how. fraud-proof in issuance.
(Details matter, and my colleagues will have more to say, I’m sure.)
2) Impervious to alteration. With various printing methods, secure card
But then there is their gratuitous national ID proposal for all American stocks, and encryption, card security is the easiest to do. It is possible to
workers, and stepped up interior enforcement. “Interior enforcement” is create a card that can’t be altered except at extraordinary expense.
a euphemism for “rounding up illegal workers” under some
administrations and “raiding employers” under others. 3) Impervious to forgery. Odd though it may seem, technology does not
govern whether a card can be forged—motivation does. Any card can can
This is the most specific Senator Schumer has ever been about his be forged if the price is right. Were a single card to provide entrée to
biometric national ID proposal, though he’s had it in mind since at least work in the United States, it’s virtually guaranteed that criminal
2007. But it is hardly satisfactory, and the claim there will be no national enterprises would forge the physical card and defeat the digital systems
ID database is almost certainly not true. they need to.

Here is the paragraph that captures the senators’ plan: The idea of a “fraud-proof” card (in whatever sense the senators mean)
sounds nice. But it doesn’t bear up under the stresses to be encountered
We would require all U.S. citizens and legal immigrants who by a national ID system that governs whether people can earn a living
want jobs to obtain a high-tech, fraud-proof Social Security (and probably much more). During the decade or more that this system
card. Each card’s unique biometric identifier would be stored is being designed and implemented, new ways of attacking biometrics
only on the card; no government database would house and encryption will emerge. A reasonably ”fraud-proof” card today is not
everyone’s information. The cards would not contain any still fraud-proof in 2020.
private information, medical information, nor tracking
devices. The card will be a high-tech version of the Social Each card’s unique biometric identifier would be stored only
Security card that citizens already have. on the card; no government database would house everyone’s

Today’s Tabbloid PERSONAL NEWS FOR 20 March 2010

It is possible to have a biometric card without a biometric database. The Understand that the Social Security number is an identifier. It is already
card would hold a digital description of the relevant biometric (such as used in government, throughout the financial services system, and in
fingerprint or iris scan). That algorithm would be compared by the card much of health care to administer services and benefits, and to perform
or by a reader to the person presenting it, determining wether it should surveillance (both for good or for bad).
be accepted as theirs.
With a uniform biometric Social Security card in the hands of every
The promise not to create a biometric database is a welcome one. The worker, the card would be demanded at more and more points in society.
senators should require—in law—that the enrollment process and Americans would have to present their national ID when they use credit
technology be fully open and transparent so that non-government cards, when they check into hotels, at bars, in airports, pharmacies,
technologists can ensure that the system does not secretly or mistakenly doctors’ offices, and so on.
collect biometrics.
A card may contain only a biometric algorithm and a Social Security
But the promise not to create a national identity database is almost number—unlikely though that may be. It will still act as a tracking device
certainly false. when it integrates with the card readers and databases that grow up
around it.
Let’s review how an identity card is issued at a motor vehicle office
today: People take the required documents to a DMV and hand them The card will be a high-tech version of the Social Security
over. If the DMV accepts their documentation, the DMV creates a file card that citizens already have.
about the person containing at least the material that will be printed on
the card—including the person’s photograph. Then the DMV gives the This claim—to be making a simple, sensible change to the Social Security
person a card. card—is wrong. The biometric national identification scheme Senators
Schumer and Graham propose is much, much more than a “high-
What would happen if DMVs didn’t keep this file? A couple of tech” Social Security card. It’s the biggest, most difficult identity system
things—things that make the senators’ claim not to be creating a national ever proposed. It will take decades and tens or hundreds of billions of
identity database highly doubtful. taxpayer dollars to build.

If there were no file and a card were lost or stolen, for example, the About the only similarity between today’s Social Security card and the
person would have to return to the card issuer again—with all the biometric national ID card these senators propose is that they’re both
documents—and run through the entire process again. Because they have rectangular.
databases, DMVs today can produce a new ID and mail it to the address
of record based on a phone call or Internet visit. (They each have their In an earlier post, I called Senator Graham’s support of
own databases—much better than a single database or databases Schumer’s national ID plan inexplicable (before taking a stab at
networked together.) explaining it). Seeing the outline of their entire proposal, which would
alleviate various pressures and begin a welcome transition back toward
If no file exists, multiple people could use the very same documents to the rule of law in the immigration area, I am truly at a loss to understand
create ID card after ID card after ID card in the same name but with why they would attach this grauitous and punitive plan to force law-
different biometrics. Workers in the card issuing office could accept abiding American citizens into a biometric national ID system.
bribes with near impunity because there would be no documents proving
that they had issued cards wrongly. Criminal use of the system would Senators, why not do it without the national ID?
swamp it.

So that they can provide customer service, and for security reasons, state
DMVs keep information about license holders, including a biometric of a
sort—a photograph. Senators Schumer and Graham may think that they
are designing a database-free biometric identity system—such a thing
can exist—but the realities they confront will drive it to become a full-
scale biometric national identity database.

The cards would not contain any private information, medical

information, nor tracking devices.

This is a welcome pledge, and to fulfill it, they should bar—in law—the
use of writeable chips or RFID chips. And there is no way to prevent the
card itself from acting as a tracking device. It will be a pointer to
private medical information, financial information, and much more.