The Lighthouse^®

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The Lighthouse^® is the weekly email newsletter of the Independent Institute.
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Volume 19, Issue 2: January 10, 2017

1. Four Reasons to Favor the Sessions-Cassidy Health Plan
2. Obama and the Drone Syndrome
3. Reforming the Federal Budget: Zero-Based Swamp Draining
4. The U.S. Constitution, Not Precedent, Is the Law of the Land
5. Independent Updates

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Obamacare is at best a flimsy framework for the nation’s health policy. Its fragility poses numerous risks, including increasingly higher premiums, higher deductibles, and narrower provider networks—all in evidence today. In the context of the new political environment, it also means that dismantling Obamacare requires tremendous legislative care, lest the edifice fall uncontrollably and create massive casualties. There are four pitfalls in particular that the new Congress must take steps to avoid, Independent Institute Senior Fellow John C. Goodman explains in a new piece for Forbes.

Donald Trump pledged to repeal Obamacare his first day in office. But if the new Congress sends him repeal legislation on Day One, yet delays sending him replacement legislation, the likely result is major inertia—the temptation to postpone replacement indefinitely, causing insurers to leave the Obamacare exchanges more rapidly and creating new and bigger headaches for consumers and the GOP. Thus, it’s better for Congress to quickly offer good replacement legislation, rather than a “perfect” bill months or years down the road, according to Goodman. Improvements could be added before the new law went into effect.

In addition, Congress should retain the revenues that Obamacare collects from the special interests that helped to pass the Affordable Care Act, including hospitals, insurers, and drug manufacturers. Without these revenues, “there will be no way to fund an Obamacare replacement,” Goodman writes. Nor should Congress impose a so-called Cadillac tax on generous employer health plans. The replacement legislation should include a tax credit that employers could use to help employees enroll in a group plan, Goodman argues. These four measures—ready-to-go replacement legislation, productive redirection of the Obamacare revenues, no tax increases on insurance benefits, and tax relief for employers—all sidestep four major pitfalls. They are currently embodied in two (and only two) bills—one that Sen. Bill Cassidy introduced in the Senate and another that Cassidy and Rep. Pete Sessions circulated in both houses. “I believe these bills can get Democratic support as well,” Goodman concludes.

Four Minefields in the Repeal of Obamacare and How to Avoid Them, by John C. Goodman (Forbes, 1/4/17)

Why the Republicans Don’t Have an Obamacare Replacement Plan, by John C. Goodman (Forbes, 12/20/16)

The Sessions-Cassidy Health Plan, by John C. Goodman (8/25/16)

A Better Choice: Healthcare Solutions for America, by John C. Goodman

Priceless: Curing the Healthcare Crisis, by John C. Goodman

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A pro-Obama blog, whose name shall go unmentioned, maintains a list of accomplishments by the nation’s forty-fourth president. So far, it runs more than 400 items long. Yet nowhere does the blogger mention what is likely to be President Obama’s lasting military legacy: his staggering use of drones in combat.

According to Independent Institute Research Fellow Abigail R. Hall Blanco, the U.S. military conducted 50 drone strikes under President Bush’s orders. By January 2016, Obama had ordered 506 known drone strikes. Drones—or unmanned aerial vehicles (UAVs)—are allegedly cheaper, more effective against terrorists, and safe for civilian populations. In reality, they fail by each of those measures, according to Hall Blanco.

Drones aren’t cheap—the cost of a single Northrup Grumman RQ-4 Global Hawk is just shy of one-quarter of a billion dollars. Moreover, the full costs of using a drone include its ground pilots and support personnel. As for their counterterrorism superiority, drone strikes may actually swell the ranks of terrorist groups. The reason cuts to the third falsehood about drones: They are associated not with public safety, but with large numbers of civilian casualties—10 times more than manned strikes, according to researchers at the Center for Naval Analysis. Less than one year into his first term, President Obama was awarded a Nobel Peace Prize. Future generations won’t be so charitable. “Obama will be known for drones,” writes Hall Blanco.

The Drone President, by Abigail R. Hall Blanco (Washington Examiner, 1/2/17)

Book Review: We Kill Because We Can: From Soldiering to Assassination in the Drone Age, by Laurie Calhoun, reviewed by Abigail R. Hall Blanco (The Independent Review, Fall 2016)

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If the next administration is to honor its pledge to “drain the swamp,” it must find alternatives to the usual way that federal budgets are built. Because each year’s budget is partly a function of last year’s budget (along with politically useful modifications), it bears the imprint of a long line of lobbyists and pressure groups. To reduce that influence—it will never be eliminated—the White House and the new Congress should look at one practice increasingly common in the private sector: zero-based budgeting.

Accounting giant Deloitte defines zero-based budgeting this way: “a budgeting process that allocates funding based on program efficiency and necessity rather than budget history.” When done right, according to a background paper published by Deloitte, zero-based budgeting can improve “organizational efficiency by encouraging stakeholders to work together to analyze operations.” In doing so, it “helps align resource allocations with strategic goals” and improves “transparency and accountability both internally within their organization and externally with the public.”

“That’s the kind of outcome that both elected and appointed officials across the entire political spectrum in Washington, D.C., need to deliver,” writes Independent Institute Research Fellow Craig Eyermann, creator of the Government Cost Calculator at MyGovCost.org. “Zero Based Budgeting has delivered those kinds of results in the past –its time has come again for the U.S. federal government’s desperately needed comprehensive fiscal reform.”

Fixing the U.S. Government’s Budget, by Craig Eyermann (MyGovCost News & Blog, 1/9/17)

Government Cost Calculator at MyGovCost.org – What’s Government Costing You?

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When the Senate Judiciary Committee begins to consider the next nominee to the Supreme Court, two questions are sure to get a hearing: Are the candidate’s views “in the mainstream”? Would he or she “respect precedent”? Focusing on these questions, however, reveals an anti-Constitution bias, as Independent Institute Research Fellow Gary M. Galles explains in The Hill.

Honoring precedent is a venerable legal principle (stare decisis), but its applicability is widely misunderstood, Galles argues. Precedents in law or behavior were never supposed to trump constitutional law, which is properly viewed as “the supreme law of the land.” Alexander Hamilton spelled this out in Federalist 78 when he wrote that when legislation clashes with the Constitution, “judges ought to be governed by the latter rather than the former.”

James Madison, widely considered the Constitution’s chief architect, articulated this view in the chambers of Congress and elsewhere. But while the principle is crystal clear, it’s anathema to liberal proponents of a “living Constitution,” who view the nation’s top court as the proper agent of progressive activism. “Stripped of the rhetorical camouflage,” Galles writes, this view “is an ugly assault on individual rights and liberties that would be opposed by anyone who recognized that their constitutional guarantees were being put in the crosshairs.”

Disrespect for Precedent Can Be Respect for the Constitution, by Gary M. Galles (The Hill, 12/30/16)

Crossroads for Liberty: Recovering the Anti-Federalist Values of America's First Constitution, by William J. Watkins Jr.

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