The idea that America needs transforming, and that he is the man to do it, did not start with Barack Obama. The grandiosely named Center for Health Transformation (CHT) was started by former House Speaker Newt Gingrich.

In 2003, Newt Gingrich wrote Saving Lives & Saving Money: Transforming Health and Healthcare. It does offer some “free market” solutions. But doctors are apparently free only as long as they do what Newt thinks they should.

The backup plan is: “When all else fails, mandate.” Specifically, physicians who “insist on doing it the old way…should simply not be allowed to practice medicine.” As far as I know, even Obama doesn’t go this far.

In developing his plans and strategies, the CHT boasts a lot of allies: along with top leaders in federal and state governments, it includes “key corporations, top hospitals, disease advocacy groups, professional and industry associations, and leading research institutions.” Many if not all of them probably endorsed the Patient Protection and Affordable Care Act (“ObamaCare”).

Newt has embraced the key fallacy that “the number of uninsured in America is a threat to our civilization.” He thinks that medical errors are “morally unacceptable,” and that they could somehow be prevented by forcing everybody to use the health information technology that his supporters, just coincidentally, happen to sell. He speaks favorably of outgoing CMS director Donald Berwick, an avowed admirer of the British National Health Service’s rationing system. He is convinced that “disease management programs” can” dramatically improve outcomes.”

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I’ve already bragged that the Cato Institute is America’s best think tank, highlighting the fact that we took the lead in battling against Obama’s faux stimulus at a time when many were dispirited and reluctant to fight big government.

I’m biased, of course, so I’ll understand if you discount what I say. But I hope you’ll agree that my colleagues have put together an excellent video response to the President’s state-of-the-union speech.

As part of my contribution to the video, beginning around 6:35, I debunk the President’s class-warfare tax agenda by citing IRS data from the 1980s to explain that higher tax rates don’t necessarily mean higher tax revenue.

After a night’s sleep, here are a few additional observations on the President’s remarks.

• I was disappointed, but not surprised, that he repeated the economically foolish assertion that Warren Buffett pays a lower tax rate than his secretary.
• I also was not surprised that he didn’t say much about jobs and the economy. These four charts show he doesn’t have much to brag about.
• It was also noteworthy that he didn’t spend much time talking about Obamacare, which suggests that White House pollsters understand that government-run healthcare isn’t very popular.
• It was equally revealing that he didn’t spend much time on the so-called income inequality issue. Redistribution was implicit in what he said, to be sure, but the Occupy-Wall-Street crowd is probably disappointed that he didn’t explicitly embrace their agenda. More evidence that the pollsters played a big role in this speech.
• I’m definitely not surprised that he talked about eliminating Osama bin Laden. Kudos to the Commander-in-Chief.
• I was amazed that he had the gall to say “no bailouts,” particularly given his support for TARP, the Dodd-Frank bailout bill, and the giveaway to GM and the auto unions. And if the GM bailout is supposed to be a success, I’d hate to see his definition of failure.
• And I was stunned that he could talk about the housing meltdown and mortgage crisis without mentioning the Federal Reserve, Fannie Mae, or Freddie Mac. Sort of like analyzing World War II and pretending Germany and Japan didn’t exist.

Since most of the previous observation are critical, I want to stress that I’m not being partisan. I also was disappointed in the Republican response. Was the GOP smart to showcase a governor who was part of the big-spending Bush Administration? Especially one who has said nice things about the value-added tax?

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Earlier this week the Obama administration announced that health insurance plans must now be extended to include birth control without copay. These new guidelines for women’s health also include breast pumps, regular “well woman” visits, counseling about HIV and sexually transmitted infections, screening for gestational diabetes, domestic violence counseling and screening, in addition to several other services. For the most part, these new requirements will take effect Jan. 1, 2013.

Health and Human Services Secretary Kathleen Sebelius said, “These historic guidelines are based on science and existing (medical) literature and will help ensure women get the preventive health benefits they need”.

However a recent Fox News article states “generic versions of the pill are available for as little as $9 a month. Still, about half of all pregnancies are unplanned. Many are among women using some form of contraception, and forgetting to take the pill is a major reason.” This shows that even if we offer them free birth control, we have no guarantee they will not get pregnant.

Who will pay to offset the cost of these new “free” services? We all know that nothing is truly free. The rest of us will be forced to pay for these services and premiums all over will be increased. In a Bloomberg editorial they admitted, “The average yearly cost to an insurer of providing full coverage for the entire range of contraceptive methods and counseling services (with no copays or deductibles) is about $40”.

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This new video from the Center for Freedom and Prosperity explains why Medicaid should be shifted to the states. As I note in the title of this post, it’s good federalism policy and good fiscal policy. But the video also explains that Medicaid reform is good health policy since it creates an opportunity to deal with the third-party payer problem.

One of the key observations of the video is that Medicaid block grants would replicate the success of welfare reform. Getting rid of the federal welfare entitlement in the 1990s and shifting the program to the states was a very successful policy, saving billions of dollars for taxpayers and significantly reducing poverty. There is every reason to think ending the Medicaid entitlement will have similar positive results.

Medicaid block grants were included in Congressman Ryan’s budget, so this reform is definitely part of the current fiscal debate. Unfortunately, the Senate apparently is not going to produce any budget, and the White House also has expressed opposition. On the left, reducing dependency is sometimes seen as a bad thing, even though poor people are the biggest victims of big government.

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I just read something that unleashed my inner teenager, because I want to respond with a combination of OMG, LMAO, and WTF.

Donald Berwick, the person appointed by Obama to be in charge of Medicare, has a column in the Wall Street Journal that makes a very good observation about how relative prices are falling for products bought and sold in the free market. But he then draws exactly the wrong conclusion by asserting that further crippling market forces for healthcare will yield similar cost savings for programs such as Medicare.

Here’s the relevant passage from his Wall Street Journal column.

The right way is to help bring costs down by making care better and improving our health-care system. Improving quality while reducing costs is a strategy that’s had major success in other fields. Computers, cars, TVs and telephones today do more than they ever have, and the cost of these products has consistently dropped. The companies that make computers and microwaves didn’t get there by cutting what they offer: They achieved success by making their products better and more efficient. …Under President Obama’s framework, we will hold down Medicare cost growth, improve the quality of care for seniors, and save an additional $340 billion for taxpayers in the next decade.

I have no idea whether Berwick realizes that he has inverted reality, so I can’t decide whether he is cynically dishonest or hopelessly clueless. All I can say with certainty is that what he wrote is sort of like asserting “gravity causes things to fall, so therefore this rock will rise when I let go of it.”

To explain, let’s start by looking at why relative prices are falling for computers, cars, TVs and telephones. This isn’t because the companies that make these products are motivated by selflessness. Like all producers, they would love to charge high prices and get enormous profits. But because they must compete for consumers who are very careful about getting the most value for their money, the only way companies can earn profits is to be more and more efficient so they can charge low prices.

So why isn’t this happening in health care?

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Today is the six-month anniversary of the passage of President Obama’s signature legislation, what has come to be known as ObamaCare.  The White House is feting this semi-anniversary, but few Americans are in a mood to join the celebration.

Obama, who can be thin-skinned when people disagree with him, was downright irritated when the early polls showed that a majority of Americans opposed his health care “reform” bill.  On April 1, he criticized the polls as premature, saying “So before we find out if people like health care reform, we should wait to see what happens when we actually put it into place.  Just a thought.”

The problem with his argument is that the more Americans find out what is actually in this monstrosity of a bill, the less they like it.  Polls conducted by Rasmussen Reports show that 55 percent of the public supported the repeal of ObamaCare on March 25, just two days after its passage.  Today, a half-year later, the number of those favoring repeal has grown to 61 percent.

I am not one to call the President a liar.  I have too much respect for the office held by giants like George Washington and Ronald Reagan for that.  But I do believe that much of what Obama has said about his own health care bill is simply not true.  He claimed in Maine that people could keep their own health insurance, in Maryland that people could keep their own doctors.  In Washington, DC, he promised that his plan would cut costs but would not lead to the rationing of care.  He has consistently claimed that it would not fund abortions, and that its “end-of-life visits” would not lead to euthanasia.

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Today, Missouri voters will vote on Proposition C, the nation’s first statewide referendum on Obamacare.

The measure—based on the American Legislative Exchange Council’s model Freedom of Choice in Health Care Act now proposed in 42 states—challenges the individual mandate, a key provision of the new federal healthcare law that requires people to have health insurance or pay fines by 2014.

Predictably, special interest groups and their big-government allies have launched a full-scale assault on Proposition C and the concept of health care freedom.

But as the late Senator Daniel Patrick Moynihan once said, “Everyone is entitled to his own opinion, but not his own facts.”

Let’s look at the most common accusation launched by Proposition C opponents and why the Show Me State would benefit from a little truthtelling.

The Missouri Hospital Association charges that, without a requirement to purchase health insurance, people will become “freeloaders” who impose their costs on taxpayers and clog emergency rooms.

Although the cost of treating the uninsured is borne by those of us with health insurance, researchers estimate these costs to be just 2-3% of overall health spending.

And the most recent study from the National Center for Health Statistics shows that people on Medicaid—a program that, thanks to Obamacare, will add 300,000 Missourians to its rolls—are more than twice as likely to visit the emergency room than the uninsured.

What Proposition C opponents don’t tell you is that so-called “freeloaders” will continue to show up in the emergency room with or without a mandate.  Massachusetts, a state that imposed an individual mandate in 2006, has seen its ER use climb by 17% since the law was enacted.

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Republicans in the House of Representatives are seeking to force a vote, using a discharge petition, on repealing Obamacare. This has caused some infighting since some Republicans want to simply repeal the monstrosity that passed earlier this year, while other GOPers are in the repeal-and-replace camp (Heritage Action is leading the pure repeal effort and National Review has good coverage here and here).

I’m not an expert on the politics of healthcare and discharge petitions, but my gut instinct is that a pure repeal vote is the best short-term strategy. Having said that, there should be no question that good policy requires much more than repeal. In this new Center for Freedom and Prosperity video, Eline van den Broek of the European Independent Institute explains that Obamacare should be repealed, but she also makes a key observation that the American healthcare system was in deep trouble even before that legislation was adopted and sweeping reforms are needed for Medicare, Medicaid, and the tax code’s healthcare exclusion.

I especially like the “Health Freedom Meter” in the video. Citing government data on the huge share of healthcare spending that already is being financed by taxpayers – and showing that only 12 percent is financed directly by consumers, the Health Freedom Meter shows that Obamacare moved America from having a healthcare system 67 percent controlled by government to a system 79 percent controlled by government. That’s obviously a step in the wrong direction, but it also makes clear that repealing Obamacare means a system that will still be burdened with far too much government invovlement and intervention.

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So where do we go from here now that Obama has succeeded in pushing through a corrupt and bloated healthcare bill?

Let’s start with some good news. This is not the end of the world. If this was 1920, Obamacare would be a paradigm-shifting expansion in the size and scope of Washington. But we do not have a free-market healthcare system today. Government already directly finances nearly one-half of all health expenditures, and the ostensibly private part of our healthcare system is immensely distorted by regulations and tax policy (particularly the exclusion of fringe benefits in the tax code).

Source: CATO Institute

We have deviated so far from a free market that only 12 percent of healthcare costs are paid for out-of-pocket by consumers. And health insurance, rather than being based on risk and protecting against catastrophic expenses, has morphed into a grossly inefficient form of pre-paid health care.

So what does this mean? The way to think of Obamacare is that we are shifting from a healthcare system 68 percent controlled/directed by government to one that (when all the bad policies are phased in) is 79 percent controlled/directed by government. Those numbers are just vague estimates, to be sure, but they underscore why Obamacare is just a continuation of a terrible trend, not a profound paradigm shift. Yes, it is very bad news. Yes, it will cost more than politicians claimed. Yes, it will reduce the quality of care. All those things are true, but we are going 79 mph in the wrong direction instead of 68 mph.

By the way, the 2008 elections did not make that much difference.

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President Obama has been barnstorming the country saying that CBO scores his health care takeover plan as reducing the deficit by over $100 billion in the first 10 years, and by almost a trillion dollars over the second 10 years.  What is that based on?

Wading deep into documents available from CBO and the House and Senate Budget Committees reveals that the claim that Obamacare, in the form of the Senate health bill Democrats are now trying to deem through the House, would reduce the deficit is based on the assumption of an immediate 21% cut in payments to doctors and hospitals under Medicare.  But that is just the beginning.

The growth of these payments would be arbitrarily limited over time, so this cut would effectively become bigger and bigger.  For the second 10 years, the claim that Obamacare would reduce the deficit by close to a trillion dollars is based on assumed Medicare cuts over those years of over $2 trillion.

This would cause havoc and chaos in health care for America’s seniors.  They would often not be able to find doctors, specialists and hospitals to provide needed health care.  Most enjoying superior coverage from Medicare Advantage plans would lose that coverage, as indicated by the Chief Actuary for Medicare.  Investment in new health care technology, new breakthrough medical treatments and services, and new miracle cure drugs would dry up, which has already started.

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President Obama and congressional Democrats are claiming that a giant new entitlement program will reduce red ink.  It’s tempting to laugh and dismiss such a preposterous claim. After all, these are the same people who told us that squandering $787 billion on a so-called stimulus would create jobs. Unfortunately, the joke’s on us. According to the “official” scoring estimates on Capitol Hill, Obamacare supposedly will lower the deficit because taxes are being increased more than spending is being increased (not that this should matter since America’s fiscal crisis is spending and deficits are merely a symptom). But these numbers, produced by the Congressional Budget Office and Joint Committee on Taxation, are highly suspect. I’ve explained elsewhere why the spending projections from the CBO are grossly flawed, and many other experts have made similar observations. The same problem exists on the revenue side of the ledger.  This video explains why we should be very skeptical of any numbers produced by the Joint Committee on Taxation.

Let’s put this in context by reviewing the supposedly nonpartisan numbers that the JCT has produced. The Senate bill has big tax increases on insurance companies, medical device makers, and so-called cadillac health plans. The House plan, meanwhile, largely relies on higher income tax rates on investors and entrpreneurs. And both bills impose huge marginal tax rate increases on middle class taxpayers thanks to the phase out of subsidies, as explained in gruesome detail by my Cato Institue colleage Michael Cannon.

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Writing for Forbes, Bruce Bartlett puts forth an interesting hypothesis that healthcare legislation could have been made better (hopefully he meant to write “less destructive”) if the GOP had been willing to compromise with Democrats:

Democrats desperately wanted a bipartisan bill and would have given a lot to get a few Republicans on board. This undoubtedly would have led to enactment of a better health bill than the one we are likely to get. But Republicans never put forward an alternative health proposal. Instead, they took the position that our current health system is perfect just as it is.

Bruce makes several compelling points in the article, especially when he notes that it will be virtually impossible to repeal a bad bill after 2010 or 2012, but there are good reasons to disagree with his analysis. First, he is wrong in stating that Republicans were united against any compromise. Several GOP senators spent months trying to negotiate something less objectionable, but those discussions were futile. Also, I’m not sure it’s correct to assert Republicans took a the-current-system-is-perfect position.

They may not have offered a full alternative (they did have a few good reforms such as allowing the purchase of insurance across state lines), but their main message was that the Democrats were going to make the current system worse. Strikes me as a perfectly reasonable position, one that I imagine Bruce shares. But let’s further explore Bruce’s core hypothesis: Would compromise have generated a better bill? It’s possible, to be sure, but there are also several reasons why that approach may have backfired:

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Just sit back and let big daddy government show you the way. The Democrat Party is assuring us that they know better because they have science, educated people, doctors and all that “expertise” in their control. Further more they “care” about us all and they want us to know that they’d never do anything to lead us astray.

If you feel like the con is about to begin, you are right.

Of course, we don’t need mere suspicion to divine that the Democrats are liars. We can look at what government and Democrats have already done in several related areas — science, smoking and healthcare — to prove that this newest attempt to “help” us is based on lies, smoke and mirrors.

Let us begin with science. In two areas we see the failure that Democrats perpetuate even with science as their justification: global warming and healthcare.

We are all by now familiar with the lies that global warming is based upon, as revealed by the scheming to hide failure of the science that went on behind the scenes with the email correspondence of the “scientists” at the University of East Anglia Climatic Research Unit (CRU). The science went from settled “consensus” to “ClimateGate” in only a matter of weeks. Yet governments all across the globe have based their policies on these lies. Total failure.

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According to the Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT), the government-run healthcare plans in the House and Senate will reduce budget deficits. To use a technical phrase, this is utter nonsense. A giant new entitlement program will be a budget buster. This new video from the Center for Freedom and Prosperity provides 12 reasons in less than 6-1/2 minutes – including real-world evidence showing how Medicare and Medicaid cost far more than originally forecast.

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After holding the first successful “House Call” yesterday, Republican Congressmen Steve King (R-IA) and Michele Bachmann (R-MN) are pleased to announce a second rally in the nations capitol tomorrow.

Second “House Call” Event Planned For Tomorrow.

King Calls on American People to Come to Washington and Kill PelosiCare

Congressman Steve King today made the following statement urging American citizens to descend on Washington to kill ‘Pelosi Care’.

“Nancy Pelosi and Washington liberals cannot ignore what transpired yesterday in Washington. Americans from every state stormed Capitol Hill. They took over the Hill. And they loudly chanted ‘Kill this bill!’ “We can kill this bill and stop the government takeover of health care. We need the help of every American willing to stand up for freedom and liberty. I urge all Americans who oppose this bill to come to Washington tomorrow morning and join us to stop this bill.”

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From the House Ways and Means Republicans:

Today, Ranking Member of the House Ways and Means Committee Dave Camp (R-MI) released a letter from the non-partisan Joint Committee on Taxation (JCT) confirming that the failure to comply with the individual mandate to buy health insurance contained in the Pelosi health care bill (H.R. 3962, as amended) could land people in jail.  The JCT letter makes clear that Americans who do not maintain “acceptable health insurance coverage” and who choose not to pay the bill’s new individual mandate tax (generally 2.5% of income), are subject to numerous civil and criminal penalties, including criminal fines of up to $250,000 and imprisonment of up to five years.

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Special to Big Government from Helen Rittelmeyer, The Daily Caller:

Capitol Police arrested ten people on the second floor of the Cannon House Office Building at a sit-in this afternoon.  The demonstrators had crowded into the office of Speaker Nancy Pelosi with a print-out of the health care bill, intending to tear up the bill in protest.

“It was a mess.  There was paper all over the hallway,” said Jeanette Beam, who traveled from Georgia to join the protest.  “They took a little old lady away in plastic handcuffs.”

The arrests, which happened a little before three o’clock, prompted plenty of chatter but little surprise.  Earlier in the day, an organizer with a megaphone had explained the plan for the sit-in.  “The police know we’re coming,” he announced.  “No one has to get arrested if they don’t want to.”

The protesters were part of a crowd of 10,000 that gathered on Capitol Hill to protest the Democratic health care bill.  The “emergency house call” was initiated by Rep. Michele Bachmann and organized by Americans for Prosperity.

Bachmann greeted the crowd from the Capitol steps: “You came.  You came to your House.”  When her remarks were interrupted by a chant of “Kill the bill,” Bachmann joked, “Oh, don’t hold back.  Tell them how you really feel!”  She continued, “Kill the bill – that’s exactly what you’re going to tell them.”

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If there were a Death Panel empowered by legislative fiat to determine the political viability of legislative agendas in Washington, D.C., it would declare ObamaCare all but dead, not worth any further time and expense incurred by the American people.  “Do Not Resuscitate,” the tribunal would vote, citing the best comparative effectiveness research in its non-negotiable determination.

Unfortunately, that merciful committee does not exist, so we have been subjected to yet another clarifying speech from President Obama on his proposed hostile government takeover of our health care.  In just a few weeks, we have gone from “health care reform” to “insurance reform,” and now “health security.”  Is it just me, or does this White House simply repackage the very same bad ideas with more carefully chosen new words, confusing rhetorical elegance for good policy?  Ok, maybe less rhetorically elegant than once believed.

Regardless, the timing of last night’s hastily arranged speech before a joint session of Congress was weird.  Such special sessions are themselves weird, exceedingly rare forums usually reserved for dramatic effect, like when Presidents declare war.  The glaring exception, it seems, was Bill Clinton’s ill-fated, pen-wagging veto threat to Congress if they failed to pass his (Hillary’s) health care plan.  So why did Obama do it?  Why now?  According to USA Today before his speech, “the ever more noisy opposition to his health care objectives has had one result: It prompted Obama’s decision to address a joint session of Congress on Wednesday in an effort to regain momentum on the issue.”

So the President wants to have another argument with the voters. He already has ridiculed publicly citizens who have the audacity to disagree, like the lady who asked him to keep government out of her Medicare. (Maybe she was referring to his proposed $500 billion in cuts from a system that is already $46 trillion in the red, to fund another government-run health care system for new populations?)

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