Tuesday, November 24, 2009

Tell me something good about health reform

President Obama has directed everyone on the White House staff to read A Milestone in the Health Care Journey by Ronald Brownstein at The Atlantic. The takeaway from the article: the current Senate bill contains a whole lot of good ideas for controlling costs, with a built-in exploratory process for service improvement and cost containment. There are no guarantees that it will work, but it sure will try hard. It seems this just might be the rare bird that has been improved (so far) by Senate delay and tweaking. We'll have to see what happens on the floor, but Brownstein's assessment gives me hope that the final product could be something good.

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Tax reform on the net

Just in case you might have been thinking not enough has been written about tax reform, Bruce Bartlett has assembled an impressive list (hat tip Ezra Klein). This is to get out ahead of a plan to simplify the US tax system expected to come from the White House next week.

This reminds me of an article (fee required) in the New York Times by Russell Baker back in 1985 about complifying the tax code in the reform act that eventually passed in 1986. That reform simultaneously added a bunch of new deductions and exemptions while removing a lot of existing ones and reducing the number of tax brackets.

If I were king, I would:

  • Eliminate the corporate income tax and replace it with a consumption-based value-added tax (VAT). Invite state governments to replace their sales and corporate income taxes with a VAT that could be collected on their behalf by the federal government and also collected on all internet purchases.
  • Broaden the base of the personal income tax and reduce the marginal rates by eliminating most deductions and exemptions from the personal income tax, including the home mortgage deduction and the medical insurance exemption, while simultaneously raising the standard deduction and the Earned Income Tax Credit (EITC).
  • Do away with separate treatment of capital gains and tax them like ordinary income.
  • Eliminate the income caps on the Social Security tax (FICA) and reduce the marginal rate.
  • Levy a carbon tax. This would include a rise in the gasoline tax to $2 per gallon, by 3 cents per month over many months, and use these revenues to reduce income taxes.

Piece of cake. Let's see what the White House comes up with.

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Friday, November 20, 2009

Texas' gay marriage ban may have banned all marriages

Cutting off the nose to spite the face department:


Barbara Ann Radnofsky, a Houston lawyer and Democratic candidate for attorney general, says that a 22-word clause in a 2005 constitutional amendment designed to ban gay marriages erroneously endangers the legal status of all marriages in the state.

The amendment, approved by the Legislature and overwhelmingly ratified by voters, declares that "marriage in this state shall consist only of the union of one man and one woman." But the troublemaking phrase, as Radnofsky sees it, is Subsection B, which declares:

"This state or a political subdivision of this state may not create or recognize any legal status identical or similar to marriage."


Uh-oh! The rest of the article from the Fort Worth Star-Telegram is here.

Thursday, November 12, 2009

Carbon sinks

Evidently there are naturally occurring minerals that absorb carbon dioxide from the atmosphere. These minerals are abundant. There may be enough in the United States, for example, to store 500 years' worth of US carbon dioxide emissions. But the rock absorbs CO2 slowly. It would take thousands of years to absorb an amount needed to have a significant impact on global warming. Trying to speed up the process is expensive and in the lone demonstration project cited in the article, the process consumed so much energy that it created more carbon dioxide than it absorbed. More in a recent news article here.

The article makes an argument for more research funding on mineral sequestration:

Insufficient research funding is the working scientist's perennial complaint. But considering how much money the federal government has already extended toward dubious climate solutions like biofuel, and considering how overwhelming the need to develop big solutions to climate change has become, it's difficult to understand why mineral sequestration — the potential merits of which are so impressive — hasn't garnered more attention.

The article doesn't address the costs of mining the material. How much digging would it take to mine a significant amount, and what would be the environmental consequences of the mining? Here is an older academic paper that raises some of these issues.

Here's another short summary with nice graphics that identifies these other issues as well, from about 2002. An interesting bit of overoptimism: this paper cites a prediction that mineral sequestration will be successfully demonstrated at a cost of one cent per kilowatt-hour by 2007. (Average cost per kwh in the United States currently is between 10 and 11 cents.)

Still, it doesn't seem we'd lose much if we shifted to mineral sequestration research some of the money currently allocated to corn ethanol or underground injection of CO2 gas.

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Monday, November 09, 2009

Health insurance and lessons in government funding

The House of Representatives passed the health insurance bill Saturday night, moving near-universal health insurance in the US the farthest it has ever progressed in the 60 years since Truman first tried to enact it. But in order to pass, Speaker Pelosi had to allow a vote on an amendment to the bill that prevents any plan in the "public exchange" from covering expenses for abortions (except in cases of incest, rape, or threat to the health of the mother).

Had the unamended bill passed, no federal money would have been allowed to be spent on abortions. Insurance plans that covered abortions would have had to segregate public and private funds, using only private funds to pay for abortions. The amendment says the plans in the exchange will not be able to pay for abortions at all. The public exchange will include any public option, should it survive passage in the Senate, as well as private plans offered as individual policies or small group plans.

Not all private plans cover abortion, and current federally subsidized plans like Medicaid and the federal employee plan also do not cover abortion. The insurance exchange has potential to grow in the future to include a large portion of the population, including many families who will pay entirely with their own funds and no federal subsidy. Even these families will not be able to buy a plan that covers abortion and will have to pay out of pocket should they ever find themselves in need of one.

Much of the credit for passage of the abortion amendment belongs to a high-profile lobbying effort by Catholic bishops, who said they would oppose any legislation that didn't ban abortion coverage for insurance policies offered in the public exchange. They lined up a bloc of Democrats big enough to defeat the bill (along with all the Republicans) if it did not ban abortions.

This is an interesting position for the Catholic bishops to take. If federal money touches an insurance policy (or even if it doesn't, but the policy is in the public exchange), then it violates the conscience of some taxpayers to be funding (or not funding) abortions. This is exactly the opposite of the Catholic Church's argument concerning school vouchers.

Many primarily urban school districts have school voucher plans that allow poor children or children from underperforming schools to use public vouchers to attend private schools. Many of these schools are Catholic. The Catholic schools and their supporters argue that public money flowing to religious schools does not violate the establishment clause of the first amendment because the government is not making the decision; individual voucher recipients are. The Supreme Court, in the Zelman case, accepted this argument and upheld the practice in a 5-4 vote in 2002.

So families are entitled to freedom of conscience when using public money to pay tuition at private schools. This is not establishment of religion. This is not an offense to taxpayers who are not Catholic (or not other denominations whose schools might receive voucher funding). But when families use vouchers partially funded with public money (or not funded at all with public money) to buy insurance, the policies must comply with Catholic tenets. The recipients of public money (or not recipients) are not entitled to freedom of conscience when making a decision about their own health insurance.

Some people opposed to school vouchers make the argument that the Catholic Church should oppose funding tuition at religious schools via public vouchers, because the public financing may lead to restrictions on the funds that will permit government influence over the religious schools' curricula.

I think this argument is mostly disingenuous, made by people who aren't religious, but the possibility is there. This should also be a warning to the political left when they argue for expansion of government-funded services. As seen with the public-exchange abortion ban, government micromanagement is hard to avoid.

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