Monday, October 08, 2007

Two tidbits from Cato Institute

The first one is particularly interesting to me because a while back I got an email from the ORP about what the priorities for the upcoming state legislature should be and 'de-regulation' was one of the options.

Market Fix Rests on Bright Ideas

"Texas power rates have increased 56 percent since 2000, and the state's electricity is among the most expensive in the country despite promises prices would go down when the state opened electric power to competition," reports The Houston Chronicle. "Many in the industry say the market is working, particularly for customers willing to shop for the best rates. Two of the state's top three political leaders, House Speaker Tom Craddick and Gov. Rick Perry, share that view."

In "Short-Circuited," Jerry Taylor, Cato senior fellow, and Peter Van Doren, editor of Cato's regulation magazine, write:

"After a pretty good 30-year run, deregulation is on the political ropes. Although loosening the shackles on banking, trucking and airlines delivered lower prices, robust competition and political applause, it hasn't worked for electricity. ... So did free market reformers take deregulation too far? Yes and no. Yes, because they promised rate reductions they had no business promising. No, because deregulation of some parts of the system was offset by more ambitious regulations elsewhere. The end result is even more economically artificial than the one we started with. ... True deregulation involves allowing market actors to run their businesses in whatever manner they like, price what the market will bear, and discover for themselves how best to deliver goods and services without government influencing those decisions with carrots and sticks. The faux deregulation we have in the electricity market unfortunately falls short on most of those counts. And that -- rather than the rate increases -- is the real problem.

And then there was this one, particularly interesting considering the upcoming political discussion on SCHIP:

Democrats See Wedge Issue in Health Bill

"Representative John R. Kuhl Jr. of New York received just his second telephone call ever from his state's Democratic governor, Eliot Spitzer, last week and was not surprised at the topic: children's health insurance," reports The New York Times. "'He said, 'I am calling you to come over to the dark side,' 'said Mr. Kuhl, who was urged by the governor to drop his opposition to health care legislation and join the effort to override President Bush's veto of the bill. Mr. Kuhl, a Republican who narrowly survived the Democratic sweep of 2006, said he was unlikely to budge. As a result, voters in his district will also be getting calls -- from Democrats and advocacy groups who are planning a telephone, radio, television and even text-message barrage against Republicans over what is shaping up as a defining domestic policy issue of the 2008 campaign."

In "Sink this SCHIP," Michael F. Cannon, director of Cato's health-policy studies and co-author of Healthy Competition: What's Holding Back Health Care and How to Free It, writes:

"SCHIP is senseless. Like its much larger sibling, Medicaid ... both programs force taxpayers to subsidize people who don't need help, discourage low-income families from climbing the economic ladder - and make private insurance more expensive for everyone else. ... All told, SCHIP is a very costly way of helping targeted families obtain health coverage...Some will complain that scrapping SCHIP would leave dependent families in the lurch. As a transitional step, Congress could convert federal Medicaid and SCHIP funding into a smaller, lump-sum payment to each state. That would serve as a halfway point toward eliminating these payments and simultaneously cutting taxes. States that want to maintain their current spending levels could raise the tax revenue themselves.

Whatever your position on the current legislation, I think the whole issue of the Federal government doing this - especially when it's called STATE Children's Health Insurance Plan - just adds more to the bureaucracy, and that's money which could be spent, instead, on direct services.


Tim Higgins said...


You look for reasoned discussion on the S-CHIP bill and I'm sorry, but that train already left the station going in the wrong direction.

Nancy Pelosi is already in full spin mode calling the smaller "increase" in the number of children covered a "cut".

To stretch the analogies to breaking point: The Liberals with their one-track mind, narrow gauge thinking are up to full steam. Anyone attempting rational discourse is now standing on the tracks with the train coming through.(wow, that one hurt)

Art A Layman said...

My Maggie, your choice of reference sites seems to have a decidely one-sided bent. Perhaps consider branching out. Look at all sides of an issue. Take off the blinders.

Many of the arguments posited on Cato range from the inane to the fatuous.

A truly intellectual mind is one that envelopes all sides of the issue, preferably in depth. To hide behind the typical sleight of hand malarky of the right is to limit a mind capable of far more.

Maggie Thurber said...

tsk tsk, art. Shame on you for assuming that this particular post is indicative of my total reading habits...

Did you notice WHY I found this tidbits interesting? The first was because of what the Ohio GOP was considering as one of their "main" issues in the upcoming legislative agenda.

The second was because SCHIP discussions are going to be more about politics rather than policy - no matter how much the American public objects...and I think it's a good question in terms of policy. Why do we let the Feds determine this rather than the states? Why does the Fed gov. take our money and then dole it back out to us with all kinds of strings attached? Wouldn't we be better off just eliminating them from the equation? Wouldn't each state save money by not paying the overhead of the federal bureaucracy?

Sadly, such policy questions will never be asked as part of the discussion in D.C. ... that might actually result in accomplishing something other than maintaining political power. (and note I'm not picking political sides in this criticism.)

Art A Layman said...

Also was interesring that in the diatribe about the electricity industry as compared to airlines, trucking, etc., th author failed to mention that one is a monopoly and the comparatives are free market players.

Sort of an apples to oranges viewpoint.

Just a thought.

Maggie: it would seem I have curried disfavor with you. For what I know not but for whatever I offer my sincerest apologies.

Maggie Thurber said...

no disfavor - none at all...

I've been really busy and am still catching up on some things...while still trying to get comments posted in a timely manner...

Maggie Thurber said...

Also, Art...I don't know about other bloggers, but sometimes I post interesting things without actually taking a position on them.

Just because I post something I find intriguing, it does not mean I agree with it, fully or even partially.

perhaps this is a unique-ness to me...

Art A Layman said...

Have not run across many states arguing against the feds providing funds for much needed programs.

Some of the problem might be that many states cannot afford what they deem as necessary to support their residents.

Interesting note: North Carolina is one of those states where both Senators voted against SCHIP. Now our median income I believe is greater that the $42,000 level but nevertheless the Governor was beside himself with their votes.

Rather than wisdom often politicians vote their party dictates.

Maggie Thurber said...

The feds have only what they first take from the residents of the states...

I still wonder why any state would want to pay a portion of the available funds (taxes) to the fed to administer a program and then dictate back to a state what they can and can't do...

And I wonder this on many issues - not just SCHIP...

Art A Layman said...

Could be wrong but it is my understanding that SCHIP, much as Medicaid is administered by the states not the fed. The fed is the bank and as such imposes restrictions on the use and appication of funds in much the same manner as banks. Most states further delegate Medicaid administration to counties and I would presume impose some general restrictions.

The issue of why funding for certain prgrams originates with the fed instead of the states is a complex discussion. Having always been a man of few words I will defer entering that debate at this point.

Have a hard time understanding, whether it's city, county, state or fed, the imposition of taxes to the conservatives is always anathema, ergo, where's the dilemma?

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