by Jon Decker
The Wall Street Journal overlooked many consequences to low-income consumers in its June 21 article “The Credit-Card Fees Merchants Hate, Banks Love and Consumers Pay.” If capping credit card interchange fees (the transaction fees which merchants are charged) would result in a windfall for the poor — why did the exact opposite happen when we capped them for debit cards?
When debit card interchange fees were capped in Obama’s Dodd-Frank legislation, fees on deposit accounts increased from an average of 3% to 5%. These fees included additional monthly account maintenance charges (with higher minimum balance requirements), insufficient-funds fees, inactivity fees, and fewer rewards. Taken together, this amounted to a direct attack on low-income families.
The fee cap also completely backfired from its intended result on the merchant side. The Richmond Fed found that, after the fee cap was instituted, 77 percent of merchants did not change their prices, just over 1 percent actually reduced prices, and over 21 percent increased prices.
Low-income consumers are being sold a trojan horse on capping credit card interchange fees. Thousands of years of history tells us that government price controls never result in more prosperity.
Photo Credit: Investment Zen
By Phil Kerpen
I recently testified before the House Select Coronavirus Subcommittee on the meltdown in nursing homes, which excluding New York (which deliberately underreports) now account for over 55 percent of deaths with COVID. The House Democrats’ goal was to blame these high death rates on President Trump – but the blame should belong squarely to the handful of governors who presided over these disasters.
More than 60 percent of both nursing home deaths and total COVID-19 deaths occurred in just seven blue states with about 20 percent of the U.S. population: New York, New Jersey, Connecticut, Pennsylvania, Massachusetts, Illinois, and Michigan. The governors in each of these states ignored federal guidelines and pursued some version of the policy of admitting infectious patients to nursing homes as soon as they were clinically stable.
Nationally about 2 percent of the long-term care population has died with COVID-19 – but over 12 percent in Connecticut, 10 percent in New Jersey, 9 percent in Massachusetts, and about 4 percent in Illinois. Even New York's dishonest underreported number is 4.4 percent of the state's long-term care population.
Carnegie Mellon and University of Pittsburgh mathematicians showed back in March that efforts to shelter everyone would lead to a far higher death total than efforts focused on the elderly, but the liberal governors chose to ignore that reality – even as we've seen over 80 percent of COVID deaths among seniors.
New York's policy was implemented via a March 25 advisory that said: "No resident shall be denied re-admission or admission to the NH solely based on a confirmed or suspected diagnosis of COVID-19. NHs are prohibited from requiring a hospitalized resident who is determined medically stable to be tested for COVID-19 prior to admission or readmission."
AMDA - The Society for Post-Acute and Long-Term Care Medicine warned in response: "Unsafe transfers will increase the risk of transmission in post-acute and long-term care facilities which will ultimately only serve to increase the return flow back to hospitals, overwhelming capacity, endangering more healthcare personnel, and escalating the death rate."
This caution was ignored and the policy stayed in effect until May 10. New York presently reports 6,413 deaths physically in long-term care facilities. Adding hospital deaths, which the state refuses to report, would likely double or triple that number.
Similar policies in New Jersey, Massachusetts, Connecticut, Illinois, Michigan, and Pennsylvania – where the state health secretary moved his own mother out of a nursing home while sending infectious patients in – produced similar outcomes.
As Dr. Anish Koka, described it: "Two weeks into the lockdown, Philadelphia hospitals had been emptied waiting for a New York-style surge that never came... But nursing home patients were treated like patients from the community who were too well to be admitted to the hospital – they were sent home. The consequences of keeping these patients at the nursing home meant the health system had to eventually deal with the entire nursing home being infected."
Pennsylvania now reports 4,345...
By Jon Decker
When weighing ones free market bona fides, few hold a candle to Senator Ted Cruz (R-TX.) He even made waves during the 2016 presidential primary for floating a return to the gold standard — a position typically reserved for only the most ardent followers of supply-side economics.
That’s why it was somewhat surprising and disappointing to see his recent introduction of the SCRIPT Act in the U.S. Senate. The SCRIPT Act intends to break down China's censorship of American films, but in practice, its imports China’s own tactics – hurting our movie industry by denying US government cooperation with filmmakers if the Department of Commerce determines they made any changes to a film – no matter how trivial – to access the Chinese market.
That could greatly disrupt US filmmaking, which relies on government cooperation for a host of production needs. Whether it’s filming with drones, shooting on public lands, soliciting advice from the military to accurately portray our Armed Forces, and more – the SCRIPT Act would bar collaboration that benefits storytellers and our national interest alike.
Moreover, Cruz’s legislation is a solution in search of a problem. China is a huge market for films, to be sure, and will soon be the biggest theatrical market in the world. But it’s misleading to think that market potential empowers Chinese censors to dictate the content of American films in exchange for access. Why? Because only 34 foreign films that share revenue with local distributors are allowed into China per year. That means only about 5% of the over 700 films produced in the US are ever released in China.
Therefore, instead of making it harder for US creators to produce films here at home, lawmakers should focus...
By Phil Kerpen
It became a major scandal when Philadelphia-based researcher Rich Weinstein uncovered video of Jonathan Gruber, the architect of Obamacare, saying: "This bill was written in a tortured way to make sure the CBO did not score the mandate as taxes. If CBO scored the mandate as taxes, the bill dies."
The quote became famous but was widely misunderstood; he was not referring to the penalty vs. tax question on which Chief Justice John Roberts would later uphold the law. The issue was whether the payment for a mandatory government insurance program should be scored as tax revenue – like Social Security or Medicare premiums – or considered private sector payments. This is crucial because a program scored as taxes and spending is transparently a government takeover, with potentially trillions of dollars shifted from the private sector to government.
There's bad news for Joe Biden's current plan. As Biden explained: "I'd bring back the individual mandate... and here's the deal. We're in a situation where if you provide an option for anybody who in fact wants to buy into Medicare for All, they can buy in."
It's hard to see how a mandate paired with a government plan could be scored by CBO as anything but taxes and spending.
The relevant CBO document is a report from May of 2009.
Biden's Medicare-for-All public option would unambiguously be scored as a government program, even if he tried to dress it up as a nonprofit. But what about the mandatory purchase of putatively private insurance under the Biden scheme? Could tortured language exclude that from the CBO score? Probably not this time.
The central framework of Obamacare, an individual mandate to buy a tightly regulated but notionally private insurance product, was a close call for CBO. Gruber, Pelosi, and Obama got away with it based the expectation that there would be many different companies in the exchanges (which in most of the country has not occurred) and on the lack of a public option.
Once Biden adds his public option, the whole program clearly becomes taxes and spending, exposing the massive expansion in the size of government expressly to the American people:
"In CBO’s view, a requirement that individuals purchase health insurance combined with tight federal constraints on the market for such insurance or a dominant role for a public plan would constitute a fundamentally governmental system, reflecting the exercise of the government’s sovereign power. In those situations, premiums appearing in the budget — for a public plan or for insurance purchased through exchanges or in the private market — should be recorded as federal revenues."
If CBO sticks to this standard, Biden will lose the principal advantage of the public plan strategy – its ability to camouflage from American voters that it leads directly to forcing everyone into a one-size-fits-all government plan by creating the illusion of allowing a choice of private plans.
The "public option" strategy for ending private insurance is to set it up in...
By Jon Decker
Last week, President Trump issued an executive order directing federal agencies to halt or repeal regulations that impede America’s recovery from the coronavirus. Trump’s focus on tackling government red tape for the next phase of the Covid recovery should be applauded — if there is one thing the pandemic has made clear, it’s that we need more social distancing between bureaucrats and the federal register.
From the onset of the virus, bureaucratic incompetence has hindered America’s recovery. First, the CDC mass-produced coronavirus tests that were contaminated with live virus. If that wasn’t enough, a federal regulation pre-dating the Trump administration made it more difficult for the private sector to step up and cover the CDC’s testing gap.
As the Competitive Enterprise Institute noted in a detailed report:
Under the Food, Drug and Cosmetic Act, diagnostic tests are considered medical devices and therefore subject to the FDA’s premarket review requirements. Under normal circumstances, the FDA has used its enforcement discretion to waive the premarket review requirement for tests developed and used exclusively within a single laboratory, known as “laboratory developed tests” (LDTs).
However, when the Secretary of Health and Human Services declares an official public health emergency, the agency does require premarket approval for LDTs, though it will grant an expedited Emergency Use Authorization for LDTs that meet the necessary criteria.
Translation: The CDC sent out tests contaminated with live virus, and the FDA said the private sector must have its approval before selling alternatives. No wonder Reagan said the scariest words in the english language were “I’m from the government, and I’m here to help.” Repealing the FDA’s burdensome testing regulations is critical to ensuring America is better prepared for...