Medicare for all would be a government takeover of health care. Peter Suderman writes:
Although [Rep. Pramila] Jayapal's plan would allow for the creation of a secondary market for supplementary coverage in addition to the government-run plan and direct cash payments to doctors, the market for the private health coverage that tens of millions of Americans currently have would be eliminated. Employers and insurers would be prohibited by law from providing the same benefits as the the government plan, a prohibition that goes further than some other countries with national health care systems. Private insurance as we know it today would be illegal.
And while the federal government would neither own hospitals nor employ doctors directly, it would be in charge of the vast majority of the nation's health care financing. That would include setting a "national health budget"—essentially, a federally imposed cap on total health care spending—and divvying up those funds by region. The federal government would also determine the budgets for capital improvements at medical facilities and set up a fee schedule imposing rates paid to doctors in private. In addition, the government would also specify staffing levels for physicians, and determine the preferred ratio of nurses to patients at any given facility.
It's true that the government already sets rates for Medicare in its current form, and those rates exert a significant influence on the administration of health care throughout the country. But today's Medicare exists alongside multiple private payers that would be eliminated under single-payer, leaving the government as the sole payer for most services.
So while doctors and hospitals would not technically be state owned under Medicare for All, the federal government would determine how the vast majority of the nation's health care dollars would be spent, making providers even more reliant on federal funds—and more susceptible to the influence and incentives of federal payment schemes—than they are today. Some practitioners might avoid this by accepting only cash payments, but it's reasonable to assume most would not. As a consequence, doctors and others in the health industry would become de facto federal employees, with significant staffing and payment decisions made by the federal government, according to formulas set by federal agencies.
Medicare for All, as envisioned by single-payer proponents like Jayapal and Sen. Bernie Sanders (I–Vt.), would thus bring about an explicit nationalization of health care financing and a tacit nationalization of health care delivery.
[Peter Suderman, "Medicare for All Would Actually Be a Government Takeover of Health Care," Reason, February 28]
Tariffs beget more tariffs. Veronique de Rugy explains:
In the end, the steel tariffs have made the production of American-made products more expensive. This makes those American producers who use steel less competitive on global markets.
Enter American producers of line pipe. As it happens, the raw materials these producers use in their domestic production of large-diameter welded line pipe and structural pipe are subjected to Section 232 tariffs (25 percent on steel imports from Canada, China, Greece and India, 50 percent on imports from Turkey and quotas on imports from Korea). As expected, the line pipe producers' production costs rose. And now these producers have gone before the USITC to argue that they are being injured by dumping — selling in the United States at prices below "fair value" — carried out by Chinese and Indian manufacturers of allegedly subsidized line pipe.
Three of the five USITC commissioners agreed. This ruling will trigger countervailing and anti-dumping duties from the Department of Commerce, and as a result, everything will end up being more expensive.
The question is: When and where does this cascading protectionism stop? Of course, the steel tariffs have affected products other than large-diameter line pipe. All American producers that use steel as inputs are negatively affected by the administration's import taxes. Inevitably, then, the USITC will see a surge of American manufacturers coming to ask for protection from foreign competitors for their products when, in fact, they need only protection from the Trump administration's trade hawks, who have made input more expensive.
[Veronique de Rugy, "Learning the Lessons of Protectionism the Hard Way," The American Spectator, February 28]
The taxes are high and the services are low! Steven Malanga debunks the idea that high-tax states provide better services:
[T]axes aren't the only reason people give for leaving or hoping to leave. When Monmouth University's polling institute asked Jersey residents, 30 percent listed taxes as a reason, the largest group. But 24 percent said that the overall high cost of living soured them on the state, and 28 percent listed reasons relating to quality of life, from government corruption and traffic congestion to lack of opportunity. A similar poll taken of the state's businesses in January of last year found that twice as many planned to expand elsewhere rather than keep growing in-state. While taxes were their biggest gripe, business executives rated quality-of-life problems close behind, with only 24 percent deeming New Jersey a better place to live than other states.
What do residents generally want from local government, and how do the states with heavy out-migration perform in those areas? In most polls, infrastructure—especially roads, bridges, and airports—ranks high among the basic things that citizens and businesses expect government to provide. Given how much revenue high-tax blue states rake in, this should be an area where they vastly outperform their peers—but the opposite is true. In its annual rankings of the best and worst places to do business in America, CNBC collects data on everything from roads and airports to water systems and ports, and then grades states on their performance. Among the bottom ten—that is, the places with the worst-rated infrastructure—are six Democratic states, which also rank among the highest in taxes collected per resident: Connecticut, Hawaii, Maryland, Massachusetts, New Jersey, and New York. No Democratic state makes the best-infrastructure list.
Even more startling, several top-rated states for infrastructure are among the lowest taxed. Governor Abbott's Jersey-poaching Texas boasts the top overall ranking. "No state ships more goods to more places than Texas," observes the study, and Texas, on average, does it better than other locales. Also scoring within the top ten: Tennessee, which collects the second-lowest state and local taxes per capita; Florida, ranked fourth lowest in taxes; and Utah, with the eighth-lowest burden. Judging by the list, an almost inverse relationship exists between the resources that state governments take in and how effectively they build and maintain infrastructure.
[Steven Malanga, "The Real Problem with the Blue-State Model," City Journal, Winter 2019]
The state and local tax deduction still distorts. Capping the state and local tax deduction was a good move, but repealing it would be even better, writes Michael Strain:
[T]he state and local deduction is a subsidy to states with large numbers of high-income individuals. Because they face higher marginal income tax rates, deductions are relatively more valuable to this group of taxpayers. (If you are in the 12 percent bracket, a deduction saves you 12 cents on your next dollar of income, compared with 35 cents if you are in the 35 percent bracket.)
Also, rich states are often high-tax states. And because states with high-income residents also have larger populations (New York, New Jersey, California, Illinois), the state and local deduction benefits places that are doing much better than many others, and distorts the tax-and-spending decisions made by these states' governments.
Supporters of this write-off argue that it prevents double taxation — to stop the same dollar of income from being taxed by both the federal and state government, taxes paid to the state should be excluded from income subject to federal tax.
But that argument doesn't really hold. State and local taxes are essential payments for goods and services, like schools, roads, police and fire departments, and public parks. Higher-tax states choose to provide more, or a better quality, of these services. Lower-tax states make a different choice.
Properly understood, state and local taxes don't reduce your ability to pay federal income tax, and don't tax the same dollar of income twice. Instead, they reflect a choice you made to live in a place in which the government provides a certain set of goods and services to taxpayers.
Residents of lower-tax states should not be on the hook for spending decisions of governments in higher-tax states.
Of course, higher-income households (many of which are located in higher-income states) do pay relatively more income tax, which is used to finance federal spending programs and transfer payments, some of which benefit citizens in other, lower-income states. Federal programs (like those that make up the social safety net) are supposed to operate this way, and the nation as a whole needs to decide how much to spend on them.
This is a separate issue from the state and local deduction, which distorts the decisions of state governments and finds citizens in one state financing the decisions of different states' governments.
[Michael R. Strain, "Get Rid of the State-Tax Deduction Altogether," Bloomberg Opinion, February 28]
Creating a new federal tax credit is the wrong way to promote school choice. Neal McCluskey points out the problem in the new school choice bill put forward by Sen. Ted Cruz (R-Texas) and Rep. Bradley Byrne (R-Ala.):
School choice is about individualization and freedom, and almost certainly that is what DeVos, Cruz, and Byrne want. But federal initiatives are a terrible way to deliver that. The reality is that what the feds fund, even indirectly, they inevitably want to control. DeVos, Cruz, and Byrne specifically acknowledge that historical reality in federal education policy. They write, "A series of administrations on both sides of the aisle have tried to fill in the blank with more money and more control, each time expecting a different result." Note that the primary vehicle for that control, the Elementary and Secondary Education Act, started aimed just at funding low-income districts. It eventually became the uber-controlling No Child Left Behind Act.
DeVos, Cruz, and Byrne are looking to skirt the control problem, sticking with tax credits instead of vouchers, and letting states opt in. But not only is this unconstitutional—taxes are authorized to execute specific, enumerated powers, not to lightly engineer state policy—it won't, ultimately, prevent encroaching federal control. If enacted, the credit would spur people to demand their states participate, and as more schools benefited from federally connected scholarships all schools would be financially pressured to use them. But the federal government will have the power to decide which state programs are or are not eligible, and on what grounds. As Corey DeAngelis and others have noted, what happens when, instead of a President Trump, we have a President Sanders or Harris and they don't like the policies of religious schools, or maybe how economics is taught? Suddenly lots of private schools and other options will be federally pressured to look very similar—shape up or credit eligibility goes away—and true choice will be curtailed.
Even the roll out of the proposal raises the specter of federal control. Though the great benefit of tax credits is they do not use government money, and hence are less prone to regulation than vouchers, DeVos, Cruz, and Byrne write that through their proposal they "are putting forward a historic investment in America's students." That sure sounds like the federal government is doing the funding, and what government funds it tends to control. Also, that Secretary DeVos is so prominent in the proposal release at least symbolizes not only federal intervention in education policy, but a strong connection to the executive—the dangerously regulatory—branch of the federal government.
[Neal McCluskey, "Even Something as Great as School Choice Should Not Be Federalized," Cato Institute, February 28]
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