Trade Wars on an Otherwise Delightful Summer Day in Kansas

Tuesday was another sunny yet unusually temperate top-down summer day here in Kansas, and we had a nice meal with our California brother and his delightful longtime partner and our excellent parents, and then dropped in on Mort’s Cigar Bar in Wichita’s Old Town district to enjoy some swinging standards from the Great American Songbook performed by a crack quartet that included our favorite local chanteuse and a brilliant young musician we’ve happily known since the day he was born. After that we came home to check in on the news, though, and wound up grousing about the ongoing trade wars.
The latest development is that President Donald Trump is proposing $12 billion in subsidies to all the farmers whose bottom lines have lately been hit hard by the rest of the world’s expected retaliation to Trump’s tariffs, which offends our Kansas Republican sensibilities. Kansas grows more wheat and corn and alfalfa and all those other crops we can’t quite identify on our drives through the country than even America’s obese consumers can eat, so the state’s all-important agricultural sector has long been reliant on hungry foreign markets to buy up the excess production, and no one around here seems at all pleased that Trump has chosen to demolish such a mutually beneficial world trading order.
That $12 billion in subsidies is a nice gesture, especially if it actually happens, but it’s going to be distributed around a large number of far more populous agricultural states and amounts to a rounding error in the trillion-dollar deficit that America is predicted to incur, and around here it’s not playing well. Both of the state’s stalwart-as-usual Republican Senators are defiantly not on board with Trump’s trade war policies, and we hear the same sentiment on the ag stations we tune into on our drives around the state’s big city. The farmers and the politicians they’ve elected around here have long advocated the food stamp and subsequent welfare programs that buy up a lot of their excess production, and they’ve long relied on crop insurance and other federal subsidy programs, but with stubborn Kansas pride they’d rather make a living by selling their excellent crops on a free international market than get by on welfare.
Our own family here in the state’s big city is far more invested in the second-most-important aviation sector of the state’s economy, which is also dependent on a world market to buy up its but up its excess production of excellent aircraft, and it’s going to take a whole lot more than mere $12 billion in deficit spending to make up the difference if the rest of the world cancels all its American airplane contracts.
Here in Kansas we have our squabbles but mostly try to get along with everybody, a lesson we learned back in the “Bleeding Kansas” days, and we’re pleased to notice that Trump’s trade wars are not popular. The strategy might prove popular in the steelmaking and aluminum-produceing states that are being protected by Trump’s tariffs, but they’re probably unpopular in all the steel- and aluminum-bying states, and we don’t see it working out well for the country at large. Which might not make any difference in the coming mid-term elections at all, and given the local Democrats’ crazy turn to the far left it  probably won’t flip any seats in Kansas, except maybe in that educated and upper-crust district up in the Kansas City suburbs.
No matter how it shakes it out, we have family and friends and good music here in the state, and we  trust we’ll eventually get by.

— Bud Norman

Trump and the Stubborn Persistence of Obamacare

For more than eight long years we griped almost every day about almost everything President Barack Obama did, and were especially critical of his crackpot Obamacare law. Lately we’ve been griping almost every day about almost everything President Donald Trump does, though, and we even have some gripes about he’s going about undoing one of the worst mistakes of Obama’s administration.
Despite Republican majorities in both chambers of Congress and a Republican president in the White House, the Grand Old Party has thus far been unable to keep its seven-year-old promise to repeal and replace Obamacare, so Trump has chosen to hasten the crackpot system’s demise by executive action. First he signed an order that allows insurance companies to offer and consumers to choose low-premium but high-deductible programs that cover only catastrophic circumstances, which were previously disallowed by Obamacare, then he ordered a halt to federal subsidies for the low-income customers who have been forced to purchase the higher-premium but lower-deductible and more comprehensive coverage. Both moves would make perfect sense in an efficiently free market system of health care, but that seems unlikely to happen any time soon, and both are admittedly designed to wreck the crackpot health care system we’ve wound up with instead.
Obama’s promises that Obamacare would save you thousands of dollars and allow you to keep your doctor and your plan and not add a dime to the federal deficit while covering everyone have since proved complete balderdash, just as we glumly predicted back when we were griping almost every day about Obama and Obamacare, but even then what our anti-authoritarian instincts most hated about the crackpot scheme was the tyrannical notion of government mandating that individuals purchase a product and then limiting their choices of what to buy. We’re therefore grateful that Trump that has struck a blow for the liberty of those young and healthy and relatively low-wage workers whose best bet on the health insurance market is a low-premium and high-deductible catastrophic plan, and we fondly recall those halcyon days when we were among them, but our middle-aged have to acknowledge that without their coerced subsidies the rest of the current system is destabilized.
An end to those federal subsidies for low-income workers stuck with the high-deductible coverage is on even more solid constitutional ground, as the crackpot Obamacare law didn’t include them and they’ve been paid all along by executive orders of very dubious constitutionality, but Trump proudly admits that it’s intended to hoist Obamacare on its own petard, although we doubt he’d recognize the Shakespearean reference. Without those subsidies many insurers will will have no choice but to pull out of many markets, leaving millions of Americans without any coverage at all, and millions more paying higher premiums for the plans they’re still stuck with under the still-existing Obamacare law.
Trump’s plan is that the resulting catastrophe will force the Democrats to come begging for some efficiently free market solution such as the Republicans have been promising for seven long years, which we’d much prefer over the long term, but in the short-term it seems unlikely to happen. The plan assumes that the public will blame Obama and his crackpot law’s inherent flaws, rather than Trump for faithfully executing it to the letter and thus blowing it up, and it seems a rare case when Trump has over-estimated the public’s intelligence. If Trump expects the congressional Democrats to be so moved by the plight of those uninsured and over-paying low income workers that they will come begging for a efficiently Republican free market solution, rather than allowing the press to pillory him for admittedly blowing things up and gleefully watching his approval ratings further plummet, we think he’s overestimating them as well. He can plausibly blame those congressional Republicans, but he won’t have anything to claim to credit for, and it will make a complicated mid-term election next year.
In any case we won’t be any closer to that efficiently free market health system we’ve yearned for far longer than the past seven years, what we’re stuck with instead will wind up imposing misery on millions of Americans earlier than necessary, and there will be plenty of blame to go around.

— Bud Norman

Who Are the Rubes?

Not since the late, great Milton Friedman has a professor of economics done as much to advance the conservative cause as the Massachusetts Institute of Technology’s Jonathan Gruber. In Gruber’s case his contributions have been entirely inadvertent, but we appreciate them nonetheless.
In case you haven’t heard the nationwide grumbling, Gruber is the “architect of Obamacare” who has been caught on several different videotapes gloating about the numerous deceptions that were built into the bill in order to assure its passage. To compound the public’s outrage he has also been caught snickering about the stupidity of the average American on whose behalf he was supposedly practicing the deceptions, which neatly epitomizes the arrogance of modern liberalism, and it further exposes exactly who are the stupid Americans.
A clear majority of Americans were never fooled into thinking that Obamacare was a good idea, even as the bill was being ramrodded through the Congress by means of questionable legality, and conservatives were wise to its deceptions all along. Gruber takes a peculiar pride in the bill’s unprecedented tax on not buying health insurance being disguised as a mandate, a bit of semantic legerdemain that the Congressional Budget Office was obliged to honor lest the bill scare off even Democrats, but all along conservatives were pointing out that it made no difference to the people who would be paying the bill under either name. When the Supreme Court upheld the dangerous notion that government can compel citizens to buy something they do not want it did so on the grounds that the mandate was indeed a tax, conservatives’ only consolation was that the government had at least been forced to acknowledge its lie. Gruber also told his fellow academics that the average American was too stupid to understand that the tax on insurers would inevitably be passed along to the insured, but the very simple concept that a tax on corporations is always paid by its customers has been a staple of conservative economics since Adam Smith. Only liberals believe that corporations pay taxes, and we are grateful to Gruber for pointing out how very stupid they are to believe such nonsense.
Gruber’s kindnesses to conservatism do not end there, however. Efforts by the likes of House Minority Leader Nancy Pelosi and other Democrats to disavow their association with the professor allowed the conservative press to point out the $400,000 and the “architect of Obamacare” title he received from them, which can only stoke the indignation of the insulted American public. He also pocketed several million dollars giving advice to the states on how to deal with the law, and his videotaped instructions include repeated warnings that the law quite deliberately insists that citizens of states which do not set up their own health care exchanges will not be eligible for Obamacare’s generous subsidies. Now that the Supreme Court has agreed to hear the King v. Burwell case, which could result in the enforcement of that provision and deny subsidies to citizens of the 37 states that declined to set up their own exchanges despite Gruber’s warnings, the administration is arguing that it was merely an unintentional typographical error and not at all the intention of Congress. The testimony of Obamacare’s acknowledged architect, along with a few other choice items from the congressional record, could effectively debunk that deception and create all sorts of welcome havoc for the law.
The formerly brilliant Gruber was also credited with creating the Obamacare-like “Romneycare” plan enacted in earlier Massachusetts, and has helpfully admitted that its brief survival was due largely to federal assistance, so his association with eponymous former Massachusetts Gov. Mitt Romney should help the more rock-ribbed sorts of Republicans in staving off any attempt by Romney or any other northeastern moderate to win their party’s presidential nomination. Gruber might yet provide further service to the conservative cause, but his astoundingly stupid admissions that only the stupid believed the claims of Obamacare has been such a boon to the self-esteem of conservatives that he has earned our eternal gratitude. One can only hope that the liberals will take umbrage at his insults, but we suspect they’re too stupid to realize he was talking about them.

— Bud Norman

Lies For the Greater Good, or Something

One problem with practicing deception, aside from the obvious moral hazards, is that a perpetrator can never claim credit for having successfully pulled it off. The temptation to boast about one’s cleverness in fooling the gullible was too great for Jonathan Gruber to resist, however, and he’s been caught on tape proudly explaining all the lies that were told get Obamacare passed.
The Massachusetts Institute of Technology professor is widely known as the “architect” of Obamacare, having served as a technical advisor to the eponymous Obama administration during the law’s drafting, and with a surprising bluntness he admits that it was built on a foundation of lies. Speaking at a 2013 panel discussion during the University of Pennsylvania’s annual Health Economics Forum he said “The bill was written in a tortured way to make sure (Congressional Budget Office) did not score the mandate as taxes. If CBO scores the mandate as taxes, the bill dies.” That lie was also made necessary by the lie President Barack Obama told during the ’08 campaign that he would not allow any tax increases on anyone making less than $250,000 a year, and was acknowledged as a lie when the administration’s lawyers insisted the president always called a “mandate” was indeed a “tax” in order to win the Supreme Court’s approval for the law, but Gruber did not stop there. He also told his admiring audience that “If you had a law which said that healthy people are going to pay in, you made explicit healthy people pay in and sick people get money, it would not have passed,” which is basically an admission that the sales pitch about people keeping their plans if they liked their plans and the average American family seeing a $2,500 reduction in their annual health care costs and not adding a dime to the deficit and all the rest of it was a lie intended to obscure the redistributionist nature of the law. “Lack of transparency is a huge political advantage,” Gruber added, “and basically, call it the stupidity of the American voter or whatever, but basically that was really critical for the thing to pass.”
Lest one think that Gruber enjoyed bamboozling his stupid fellow Americans as much as he seems to relish the re-telling, he insists that “I wish … we could make it all transparent, but I’d rather have this law than not.” Despite his admissions of dishonesty we’re inclined to believe this disclaimer. We don’t doubt that he’s quite disappointed to live in a constitutional republic with so many stupid people who must be lied to in order for his policy preferences to be imposed on them, or that he truly believes he knows better than 300 million people he has never met what is in their best interests, and would much prefer some system that allowed him dictatorial powers without resort to such unpleasant obfuscations. The attitude is infuriatingly widespread these days, and enjoys such intellectual respectability that the likes of Gruber are not at all embarrassed to express it in a public forum, so we’ll regard such heartfelt regret as sincere.
So long as he was unburdening himself, we wish Gruber had further conceded that pretty much the entirety of the modern liberal project is also based on lies being told to the people that modern liberalism claims to champion. Modern liberalism is basically a plan to rob Peter to pay Paul, but Peter is presumed to be an idiot who will fall for promises of some payoff down the road at some richer fellow’s expense, and Paul’s support can be counted on no matter how the plan is presented, and it’s all in the name of social justice, and those Republicans Peter might be tempted to vote for if the plan were more frankly stated are such awful people, so the liberal conscience is untroubled by any liberties that might be taken with the truth. The theory that the best policies derive from a democratic process of public deliberation based on honest arguments by opposing sides is quaintly old-fashioned, given a population too stupid to appreciate the obvious brilliance that is Obamacare, and cannot assail the modern liberal’s religious faith that he knows best.
Honesty and a decent respect for the democratic rights of their fellow citizens would be nice, but they’d rather have the law.

— Bud Norman

Dueling Opinions on Obamacare

Two separate federal courts hearing two separate cases issued contradictory opinions Tuesday regarding the legality of subsidies being provided to people in states with federally-run health care exchanges, and Obamacare and all its embarrassments are back in the news. It’s all very complicated, as is the case with everything Obamacare, but well worth delving into if only for the comic relief.
The dispute in both cases arises from a few words among the 2,000-plus pages of the hilariously named Affordable Care Health Act, which state in unusually clear language that the subsidies shall be made to those who are eligible by their lack of income and had enrolled in exchanges “established by the State.” Only 14 states were willing to go along with the Obamacare boondoggle by establishing their own exchanges, so in the other 36 states the law as written would stick those under-funded suckers who signed up with the full cost of their over-priced plans, which would cause many of them to stop paying their premiums and pay the much smaller fine instead, thus leaving the insurers with a sicker and less profitable pool of customers, thereby raising the poor folks’  ire and everyone else’s premiums and further endangering the already unpopular law’s chances of political survival.
The United States Court of Appeals for the District of Columbia, in a two-to-one ruling in the Halbig v. Burwell case, insisted that the law says what it says and should be enforced accordingly. A few hours later the Fourth Circuit Court of Appeals ruled in the King v. Burwell case that the law doesn’t really say what it says, and in no case should be enforced according to something so silly  as the law’s  plain text. The unfortunate Burwell, whoever he or she might be, seems headed to the Supreme Court for a final resolution.
Until then, it will be amusing to hear Obamacare’s dwindling number of defenders argue that it is the most brilliantly written legislation in American history while simultaneously arguing that it should not be read as written because of its absurdity. The oxymoronically named White House Press Secretary Josh Earnest helpfully explains that “You don’t need a fancy legal degree to understand that Congress intended for every eligible American to have access to tax credit that would lower their health care costs regardless of whether it was state officials or federal officials who are running the marketplace,” but it takes an especially fancy legal education to conclude that is not what Congress wrote into the law. Some argue that the language was quite deliberate, and intended to force recalcitrant Republican governors into starting state exchanges or face the wrath of their dependent class voters, although the estimated four to five million people being subsidized are hardly a formidable voting bloc when spread across 36 states, and far outnumbered by the voters being asked to pick up the tab for the subsidies, but if the Democrats now want to insist that it was just one of those typographical errors that are bound to happen when you’re hastily ramming an unpopular law down the public’s throat in the literal dead of night without a single vote from the opposition party they are free to do so. The D.C. Court of Appeals rejected the government’s argument that the plain text of the Affordable Care Act “renders other provisions of the ACA absurd,” which seems reasonable given that the absurdity standard would render most of the Obama administration’s actions illegal, and any Republicans who insist that the law should be enforced according to what it says are also free to do so.
We’re not such reckless gamblers that we would wager any amount of the final resolution of this matter, but we hopefully note that Professor Laurence Tribe of the impeccably fancy Harvard Law School has said “I wouldn’t bet the family farm on this coming out in a way that preserves Obamacare.” The good professor probably doesn’t have a family farm, and even if he does we can’t imagine him plowing its fields, so we take his comment as merely allegorical, but it’s heartening nonetheless. Even if the argument that a law shouldn’t be enforced as it is written just because it’s written that way does prevail, it will be nice to at last be done with the archaic pretense that the law has any meaning other than what the president wants it to mean.

— Bud Norman

Flipping the Big Bird

The reviews are in, and the most panned political advertisement of the year is the one starring Sesame Street’s Big Bird character on behalf of the Obama campaign.

In addition to the massive amounts of ridicule being heaped on the ad by the conservative punditry, even such reliably pro-Obama media outlets as NBC, ABC, and Politico have all given it a rousing thumbs-down. Yet another rebuke, and one that will likely doom to the ad to a mercifully short run, was issued by the Sesame Street producers, who politely requested that their characters be left out of the political fray.

All of the criticisms, of course, are warranted. The spot opens with a montage of Bernie Madoff, Ken Lay, and Dennis Kozlowski being hauled off in handcuffs for their notorious white collar crimes, then cuts to footage of Mitt Romney citing the sizeable subsidies to the lucrative Sesame Street franchise as an example of wasteful government spending. For the benefit of those wondering what one has to do with the other, a voice-over dripping with sarcasm helpfully explains that Romney “knows it’s not Wall Street you have to worry about, it’s Sesame Street.”

One hardly knows where to begin mocking such nonsense. Perhaps Romney isn’t spending much time on the campaign trail railing against Madoff, Lay, and Kozlowski, but that’s likely because they are all currently imprisoned for their long-ago and largely forgotten misdeeds, a point implicitly acknowledged by the ad’s images of their arrests, and few Americans outside the Obama headquarters still regard them as a pressing problem. We note that Obama has been conspicuously silent regarding Bruno Hauptmann, but we don’t take that as evidence that he’s soft on those who kidnap and murder the children of aviation heroes.

As for Romney’s alleged obsession with Big Bird, the Republican party’s word-counters have documented that Obama has invoked the character’s name far more often in recent days. More importantly, Romney has the better argument. Sesame Street’s vast licensing empire earns it huge amounts of money, as a visit to any toy store will immediately reveal, and it makes no sense for a nation $16 trillion in debt to throw it a few more bucks. Indeed, if not for the show’s mushy multi-culturalism and soft-headed emphasis on a fashionable notion of unearned self-esteem it would likely be reviled by the left as a crassly commercial creature of the hated 1 percent. Obama correctly notes that the show’s subsidies represent an almost infinitesimal portion of the budget, but that only bolsters Romney’s point that a president unwilling to make such a cut is hardly equipped to tackle the more politically difficult reforms needed to keep the country solvent.

Being of a certain age we have no lingering affection Sesame Street, and reserve our childhood television nostalgia for the private sector Captain Kangaroo, but even the most naïve pre-schoolers tuning in to Big Bird should recognize that the latest approved-by-Obama message reeks of desperation.

— Bud Norman

Obama and the Jets

Here in Wichita, Kansas, the “Air Capital of the World,” where general aviation is the backbone of the local economy, we’re always alert to the news stories concerning corporate jets. For the past three and a half years or so the stories have mostly been about Barack Obama’s relentless war on the industry, so you can imagine our surprise upon reading that he’s now offering corporate jet builders a billion dollars in subsidies.

The new policy is apparently an unintended consequence of the protracted debate over the renewal of the Import-Export Bank. We assume it’s unintended, at any rate, as we can’t imagine that Obama has suddenly acquired a new affection for corporate jets or seriously hopes to curry favor with the bitter gun-and-Bible-clinging Kansans who build them.

The Im-Ex, as it is known to those in the know, was established back in the ‘30s to help finance the purchase of American-made products by foreign buyers, but has since acquired a reputation as a dispenser of corporate welfare, with the Boeing Company’s huge airliner business being by far the biggest beneficiary. The bank’s periodic renewal is usually a routine act of Congress, but this time around it faced stiff opposition from several of the more conservative congressional Republicans, who were backed by such free market advocates as The Club For Growth, as well as such aggrieved corporations as Delta Airlines, which believe the bank is unfairly supporting their competitors’ purchases of Boeing products. More centrist politicians from both parties still love such cozy arrangements between government and business, as do such organizations as the U.S. Chamber of Commerce, and even the most stridently anti-corporate Democrats had been brought on board, so the bill had considerable bipartisan support all along, but it wasn’t until the Im-Ex’s head honcho promised to sweeten the deal with money for makers of smaller planes that the bill finally won passage in the Senate.

Obama signed the bill on Wednesday, citing it as an example of the common sense legislation needed to improve the economy, but he didn’t emphasize the corporate jet subsidies. The GOP immediately took to the internet with a reminder that as a presidential candidate in 2008 Obama had promised to eliminate the Import-Export Bank and called it “little more than a fund for corporate welfare.” The Republicans also correctly noted that Obama had previously sought to increase taxes on jet ownership, and had repeatedly given speeches that used business jets as a symbol of wretched corporate excess and immoral income inequality. No explanation for the contradictions has been forthcoming from the White House, so far as we know, nor any indication that Obama has disavowed his previous policies and rhetoric.

There’s a reasonable argument to be made for Im-Ex, which makes loans that are routinely repaid, and even for its special relationship with Boeing, an important American company whose only global competitor is heavily subsidized by the European Union, but the Obama policy of bashing corporate aviation with one hand and lavishing it with a billion dollars from the other hand is simply incoherent. A smarter administration would seek to negotiate a multilateral end to corporate subsidies with the European Union, whose member countries might well be looking for something to painlessly cut out of their budgets these days, and to devise a simplified tax code and reasonable regulatory system that would make corporate jet ownership more and allow the industry to be profitable enough that it would have no need of subsidies.

At the further edges of the right and the left, from the Tea Party to Occupy Wall Street, there is a rare agreement that corporate welfare should be abolished, but both sides have their own reasons. The right hates anything with “welfare” in the name, while the left abhors any mention of corporations. Obama seems to have staked out a strange middle position that is pro-welfare, anti-corporation, and unlikely to be of much help.

— Bud Norman