U.S. Veterans Administration: Still “Dysfunctional” with “Unaccountability at Every Level”

veritas logoJames O’Keefe, founder of Project Veritas, reports:

It has been over a year since the truth about the VA’s abysmal and unacceptable practices were thrust to the forefront of American politics, and yet there has been no discernible change in this bureaucratic nightmare. Our nation’s veterans deserve so much more and this continued mistreatment of our nation’s heroes is a troubling trend that shows no signs of any, let alone imminent, improvement.

Watch Project Veritas’ latest undercover video below showing that after more than a year of significant public outcry over incredibly long wait times, which in numerous cases resulted in the deaths of veterans, the VA is still failing to meet the basic needs of our veterans. Project Veritas investigative journalists captured on hidden camera a host of VA doctors, staffers, and one top official speaking about the many problems that persist at the VA despite official claims to the contrary.

Among the outspoken was Dr. Kristoffel Dumon, a general surgeon for the VA in Philadelphia, who told a Project Veritas undercover journalist that the VA has a “culture of unaccountability at every level.”

In this latest Project Veritas video, VA Undersecretary and Brigadier General Allison Hickey was captured on hidden camera saying that once veterans enter “the appeals process all bets are off, the only solution to that is changing the law or more people.”

A Project Veritas journalist also spoke with Scott Westguard, a VA contractor, who said on hidden camera that “it’s messed up, it’s dysfunctional, it’s incapable of getting the job done because people are there simply picking up the paycheck. There’s no accountability.”

Project Veritas also caught up with Dr. Raul Zambrano, a VA Medical Officer in the VISN & Network Office, who stated that: “we’re way below water in terms of the ability to supply, to meet the requests that’s demanded.”

It’s been 16 months since we learned of the waiting time scandal at the VA. In our last video covering the VA scandal, we identified that 22 of our nation’s heroes were dying by their own hands each day, as opposed to on the battlefield. Our first VA video has already been used to brief Congressmenabout overprescribing dangerous medications to veterans at a recent hearing on Capitol Hill.

In this video, we reveal some of the key underlying flaws within the VA which clearly make the system seem absolutely broken. Our veterans clearly deserve better.

RELATED VIDEO: A Veteran Seeking Help From a VA Office Received a Response No Veteran Should Ever Hear [+video]

Is There a Middle Road between Marijuana Incarceration and Marijuana Legalization?

As part of its special series titled Race Matters, an investigation by Miami’s CBS4 News this week, provides an opportunity to consider new ways to think about marijuana and racial imbalances in the way our laws are enforced.

CBS4 News gathered and analyzed police records of every misdemeanor marijuana case in Miami Dade County between 2010 and 2014. They found:

  • Misdemeanor marijuana arrests accounted for ten percent of all cases filed in the court system.
  • Of 44,860 closed cases, 55 percent had African-American defendants, even though the county is less than 20 percent black.
  • Just two percent of these cases resulted in a conviction.
    • Of these, 74 percent were black.
  • Prosecutors dismissed or dropped 49 percent of these cases.
    • Of these, 56 percent were white.
  • The other 49 percent of cases were settled by a “withhold of adjudication,” an admission of guilt but not a formal conviction. However, the admission stays in a person’s permanent record, hurts his or her ability to find work or housing, and can prevent the person from enlisting in the military, receiving student loans, or becoming a citizen.
    • 65 percent of these were black.

CBS4 News writes, “Miami Dade Police Director JD Patterson and others in his department have argued police officers are not targeting blacks, they are merely making stops and arrests in neighborhoods with a high crime rate. And those neighborhoods just happen to be predominantly black.”

“Donald Jones, a constitutional and civil rights law professor at the University of Miami, says that may have been the initial intent of the police, but what has happened over time is that officers begin looking at everyone in those neighborhoods as a suspect and begin treating them differently as well. ‘It says to me that we’re profiling,’ Jones said. ‘We’ve gotten to a point where we criminalize whole communities. We see certain communities as being communities of criminals and we police them that way.’ Jones said it can have a chilling effect on the relationship between the police and the community. ‘It creates an atmosphere as if this is a different America,’ he said.”

We note that the 44,000-plus marijuana cases CBS4 News examined are only 10 percent of all cases that went through the Miami Dade County court system over the five-year period.

Proponents have built their case for marijuana legalization on racial inequities in the enforcement of marijuana laws like these in Miami Dade County, implying that legalizing pot will end unequal enforcement of the law. But the problem of racial disparities in the criminal justice system is much deeper than marijuana alone, as Professor Jones explains. Until we can see that, we won’t be able to change it effectively.

Few Americans believe that putting low-level marijuana offenders, black or white, in jail is appropriate. Few believe that straddling them with lifetime criminal records is fair or just. Judges in Miami Dade County hope the county commission will adopt a proposed civil citation ordinance that would give police the option of issuing a $100 ticket to marijuana offenders. This would keep them out of the criminal justice system and reduce costs to taxpayers.

We believe that is a good first step, but it does not go far enough. Despite denials from legalization proponents, marijuana is addictive. Some nine percent of people who try the drug will become addicted. The number rises to 17 percent if use begins in adolescence and to 25 percent to 50 percent for daily use. We would like to see a public health/social justice system replace the criminal justice system for low-level marijuana offenders. Its goal would be to provide public health and social services to them after they pay their fines. Such services would medically assess them to determine if they are addicted. Those who are would receive treatment. Those who aren’t would receive educational and social services to help them pursue more productive lives. Money saved from removing marijuana cases from the courts could be used to finance this system.

Or we could do away with the marijuana laws, legalize pot, and ignore the consequences. To do so would be to allow a commercial marijuana industry to emerge that will rival the tobacco and alcohol industries, as all three prey on children, the addicted, the poor and the vulnerable, while simply discarding the victims who can’t handle their products.

Read “Race Matters: Marijuana Cases Flood Court System” here.


National Families in Action and partners, Project SAM and the Treatment Research Institute, welcome our new readers. We hope you enjoy this weekly e-newsletter to keep up-to-date with all aspects of the marijuana story. Visit our website, The Marijuana Report.Org, and subscribe to the weekly e-newsletterThe Marijuana Report to learn more.

National Families in Action is a group of families, scientists, business leaders, physicians, addiction specialists, policymakers, and others committed to protecting children from addictive drugs. We advocate for:

  • Healthy, drug-free kids
  • Nurturing, addiction-free families
  • Scientifically accurate information and education
  • A nation free of Big Marijuana
  • Smart, safe, FDA-approved medicines developed from the cannabis plant (and other plants)
  • Expanded access to medicines in FDA clinical trials for children with epilepsy

Is Michelle Obama a Brilliant Experimental Economist? by B.K. Marcus

A consensus is emerging among advocates of personal freedom and economic literacy that the Healthy, Hunger-Free Kids Act, passed in 2010 with the support of Michelle Obama, is a typical failure of the nanny state.

Reason’s Robby Soave writes, “Like so many other clumsy government attempts to make people healthier by forbidding the consumption of things they like, the initiative is a costly failure.”

But I’d rather imagine the first lady is conducting a sophisticated empirical test of economic theory. All she needs are a few more interventions to correct the “unintended consequences” of the 2010 law, and we’ll be swimming in data.

As Ludwig von Mises explained in “Middle-of-the-Road Policy Leads to Socialism,” each round of intervention into voluntary exchange leads to consequences the interventionists find undesirable. Over and over, the officials are confronted with a choice: undo the initial intervention or initiate the next round of laws and regulations in an attempt to undo the effects of the previous round. Rinse, lather, repeat.

Testifying before the House Subcommittee on Early Childhood, Elementary, and Secondary Education, school administrator John S. Payne from Hartford City, Indiana, told Congress about some of the supposedly unintended consequences in evidence at his area’s public schools.

“Perhaps the most colorful example in my district is that students have been caught bringing — and even selling — salt, pepper, and sugar in school to add taste to perceived bland and tasteless cafeteria food.”

“This ‘contraband’ economy,” says Payne, “is just one example of many that reinforce the call for flexibility” on the part of local government officials.

While laissez-faire liberals may call for the scrapping of government-managed school lunches altogether, and federalists might join Payne in advocating the efficacy of decentralized, local authority over dietary central planning from Washington, DC, those who care more about economic science than nutrition or freedom should look forward to the next several rounds of loophole-closing, ratcheting coercion, and other adjustments needed to isolate students from their remaining lunchtime alternatives.

Currently, according to Payne, some of the parents in his district are signing their children out in the middle of the school day and taking them out for a quick fast-food meal. Those without the option of escape simply choose to eat less during the day. “Whole-grain items and most of the broccoli end up in the trash,” Payne told the subcommittee.

While exit and abstention are of some interest to economic theorists, the real intellectual treat is in seeing what happens when an isolated and otherwise powerless community is reduced to black markets and barter.

In “The Economic Organisation of a POW Camp” in the November 1945 issue of Economica, former prisoner of war R.A. Radford described the economic laboratory of German prison camps:

POW camp provides a living example of a simple economy which might be used as an alternative to the Robinson Crusoe economy beloved by the text-books, and its simplicity renders the demonstration of certain economic hypotheses both amusing and instructive.

In Radford’s camp, everyone received the same rations from both the prison and the Red Cross. Some prisoners also received private parcels, but these were less reliable. At first, barter exchange among the prisoners made them all subjectively better off: the lactose-intolerant smoker will feel richer from trading his tinned milk for the nonsmoker’s cigarettes.

While those who weren’t hooked on tobacco were at first happy to trade their extra smokes for more appealing products, over time, “cigarettes rose from the status of a normal commodity to that of currency.”

This means that all goods could be exchanged directly for cigarettes. There was no longer any need to find another prisoner who both (1) had a surplus of exactly what you needed and (2) wanted just what you had in excess. Everything took on a “price” in cigarettes, eventually listed on “an Exchange and Mart notice board in every bungalow, where under the headings ‘name,’ ‘room number,’ ‘wanted’ and ‘offered’ sales and wants were advertised.”

The public and semi-permanent records of transactions led to cigarette prices being well known and thus tending to equality throughout the camp, although there were always opportunities for an astute trader to make a profit from arbitrage.

Cigarettes were the best money in the context of a POW camp. A good commodity money is valuable, countable, and fungible — divisible in such a way that it retains proportional value. A half an ounce of gold, for example, is worth about half the value of a full ounce of gold. Cutting a diamond in half is not only difficult; it could render two smaller stones whose combined value is far lower than the one you began with.

Cigarettes are somewhere in between gold and diamonds: a single cigarette isn’t as easily divisible, but a half carton probably trades for half the value of a full carton. And the cigarette itself plays the same role with its tobacco contents as coinage does with precious metals: it establishes a countable unit that makes trade more convenient and prices easier to establish and track. And in a POW camp, where the supply is limited and relatively predictable, price inflation isn’t a problem.

Today’s Hartford City schools have not yet developed the economic sophistication of Radford’s German stalag. Students smuggle in packets of salt, pepper, and sugar, and trade them directly for consumption. But if a few more rounds of intervention can reduce students’ lunch options, we can expect to see a new medium of exchange emerge. I’m betting on salt, which already has a long history as commodity money throughout the ancient world.

But if the nanny-state nutritionists are forced to back off and allow either more flexibility or more freedom, we will lose an excellent opportunity to study the evolution of basic monetary economics in a controlled setting.

Won’t someone please think of the science?

B.K. Marcus

B.K. Marcus is managing editor of the Freeman.

President Obama Is God?! — and That Ain’t Good

Whenever a culture exchanges the real God for a facsimile god, the results are ALWAYS culturally and personally disastrous. Welcome to a new, transformational moment in American history as President Obama gets exactly what he wanted from the Supreme Court of the United States, the affirmation of Obamacare and the legalization of Gay marriage, as found in the U.S. Constitution!

Sounds crazy, yep, but crazy is what Obama likes because crazy TRANSFORMS.

From a cultural mess to a national security mess we touch base with Dr. Tim Furnish regarding the FOUR Islamic jihad attacks that occurred over the Ramadan weekend.

What a way to start the day!


In-Depth: 4 Harms the Court’s Marriage Ruling Will Cause

American College of Pediatricians Calls Same-Sex Marriage Ruling ‘a Tragic Day for America’s Children’

Who’s the “Evil Empire” Now? Russia Says It’s Godless America

Christian Farm Family Penalized in Gay Wedding Refusal Cites ‘Orchestrated Set-Up’

VIDEO: Gay men blow kisses, taunting guy in ‘Ask Me About Jesus’ shirt; watch his reaction

“SCOTUScare”: Supreme Court Guts Obamacare to Uphold Subsidies by Daniel Bier

The Supreme Court has voted 6-3 (with Chief Justice Roberts writing the majority opinion, joined by Justice Kennedy and the four liberal justices) to uphold the subsidies the IRS is distributing for health insurance plans purchased on the federal insurance exchange.

This ruling sets a dangerous precedent, and its reasoning is, as Justice Scalia wrote in his dissent, “quite absurd.”

There will no doubt be much written about the decision in the coming days, and almost all of it will mischaracterize the ruling as the Supreme Court “saving” the Affordable Care Act again.

This is a crucial error: The Court’s ruling guts the ACA and rewrites [it] in a way that is politically convenient for the president — again.

When the Patient Protection and Affordable Care Act was passed in 2010, the law was designed to work through a “cooperative federalism” approach. For example, the portion of the law expanding Medicaid, like the rest of Medicaid, would be a joint federal-state program, partly funded and regulated by the feds but administered by the states.

The part of the law meant to increase individually purchased insurance coverage was similarly designed to work through federal-state cooperation.

Each state would set up its own health insurance “exchange,” and the federal government would issue tax credits for qualified individuals who purchased policies on the state exchanges. The logic here is that the states are best suited to run exchanges for their residents, as they have particular and specialized knowledge about other state healthcare programs, state regulations on insurance, and their residents’ health needs.

But the law did not (and constitutionally could not) force state governments set up exchanges. So as a backstop, a separate section of the law allows the federal government to set up an exchange for residents in states that did not set up their own.

Here’s where it got problematic: The plain text of the law only authorizes tax credits for policies purchased on an “exchange established by the State.”

There’s no easy way around this fact. Nowhere does the ACA authorize subsidies for plans purchased on the federal exchange. None of this would have been an issue if every state had chosen to build an exchange, as the law’s authors anticipated.

But in reality, the ACA has been persistently unpopular, and only 14 states (and DC) had working exchanges. The details of the backstop provision suddenly became a lot more important as the residents of 36 states were cast onto the federal exchange.

Faced with uncooperative federalism, the Obama administration suddenly had a big political problem, and it would have been quite embarrassing for the law’s biggest benefit to evaporate just as the president was planning to run for reelection on it.

So 14 months after the bill was signed into law, the IRS issued a rule, by executive fiat, to issue subsidies on the federal exchange. Because the penalty for failing [to] purchase health insurance is based on the cost of insurance, including subsidies, relative to a person’s income, individuals and businesses in states without exchanges who would otherwise have been exempt from fines and mandates were now in violation.

Lawsuits followed, which argued the IRS’s decision to issue subsidies in states that had declined to create exchanges was against the law, and it had resulted in actual harm to them.

In one of the lower court rulings on this issue, the DC Circuit concluded that the law offered no clear basis for issuing subsidies through the federal exchange.

If Congress intended to issue subsidies through the federal exchange, it would have been perfectly easy for them to say so, in any number of sections. And if Congress intended to treat the federal exchange as though it were a State entity (as the ACA does with US territories’ exchanges), it knew how to do that too. Yet there is no section of the law that does this.

Some argued that this omission was a “drafting error,” a legislative slip-up. If so, it was one it made over and over again, in at least ten different sections. And, as Michael Cannon rather pointedly asks, if it was a drafting error, why didn’t the government make that case in court? Why didn’t the IRS make that claim when they issued the new rule?

The answer may be that the law meant what the law says. The scant legislative history on this question doesn’t show that Congress ever thought that subsidies were going to be disbursed through the federal exchanges. Perhaps the law’s authors simply didn’t think about it or did not consider the possibility that most states would refuse.

But, in fact, it is entirely plausible that the ACA’s authors intended to only offer subsidies to residents of states that created exchanges, as an incentive to states to build and run them.

The reasons why Congress wanted the states to run the exchanges are perfectly clear. But, apart from the possibility of losing the subsidies, there seems to be little reason for state governments to take the risk of building one of the notoriously dysfunctional exchanges if they could dump their citizens onto the federal exchange with no consequences.

Jonathan Gruber, an MIT economist who was involved in the design of the health care law, explicitly claimed that the law’s authors did this on purpose:

If you’re a state and you don’t set up an Exchange, that means your citizens don’t get their tax credits. … I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these Exchanges, and that they’ll do it.

On the other hand, the government argued (and Roberts accepted) that the text of the law is ambiguous, and ambiguous phrases should be interpreted “in their context and with a view to their place in the overall statutory scheme,” the goal of which was to increase health insurance coverage.

Given that, Roberts concludes, we should construe “exchange established by the State” to mean any ACA exchange, whether Federal or State.

Roberts got to this reasoned, methodical, and preposterous conclusion by arguing that the plain meaning of the text would lead to “calamitous results” that Congress meant to avoid. To wit, that only allowing subsidies for plans purchased on state exchanges would cause a “death spiral” in the insurance market in states that refused to establish exchanges.

The ACA reform has three basic components: subsidies for insurance plans, the individual mandate to purchase insurance, and regulations requiring insurers to issue coverage to people with preexisting conditions (“guaranteed issue”) and banning them from charging higher premiums to sicker people (“community rating”).

The “death spiral” logic goes:

  • If states chose not to establish exchanges, their residents would not get subsidies;
  • If they couldn’t get subsidies, many people would be exempt from the insurance mandate;
  • If they were exempt, they could just wait until they got sick to buy insurance;
  • If they did that, insurers would have to accept them, under the guaranteed issue rule;
  • If that happened, the price of insurance would go up for everyone, under community rating;
  • If that happened, more healthy people would drop out of the insurance market, leaving insurers with a pool of ever sicker and more expensive patients (“adverse selection”), thus forcing insurers out of business and leaving even more people without insurance. And so on.

Hence, “death spiral.” In fact, this is exactly what happened in the 1990s in many states with guaranteed issue and community rating, before Massachusetts invented the mandate to force people to buy insurance and keep the pool of insured people relatively healthy.

But in the ACA, the mandate rests on the cost of insurance with subsidies, and (under the plain text of the law) the subsidies rest on the states establishing exchanges. If the subsidies go, fewer people will buy insurance, and the mandate crumbles, leading to a spiral of higher costs and fewer people insured.

Roberts concluded that this risk would have been unacceptable to Congress, arguing: “The combination of no tax credits and an ineffective coverage requirement could well push a State’s individual insurance market into a death spiral. It is implausible that Congress meant the Act to operate in this manner.”

This perceived implausibility, combined with the alleged ambiguity of the text, caused the Court to rule in favor of the subsidies:

Petitioners’ plain-meaning arguments are strong, but the Act’s context and structure compel the conclusion that Section 36B allows tax credits for insurance purchased on any Exchange created under the Act. Those credits are necessary for the Federal Exchanges to function like their State Exchange counterparts, and to avoid the type of calamitous result that Congress plainly meant to avoid.

The basic problem with Roberts’ decision is that the text isn’t ambiguous. It’s actually pretty clear, as he acknowledged. But the second issue is that Roberts has no strong basis for his speculations about what Congress thought was likely to happen with states or what risks it was willing tolerate.

If the ACA’s authors thought (as almost everyone did) that the states would get with the program and establish their own exchanges, there is no reason that they would have assumed a serious risk of a death spiral. In fact, Gruber suggested that was the plan all along: offer a carrot to the states (the subsidies) and a stick (the risk of screwing up their insurance market).

But more importantly, the “implausible” risk that Roberts bases his interpretation on is precisely what the ACA deliberately did to US territories by imposing guaranteed issue and community rating without an individual mandate.

The DC Circuit Court that ruled against the subsidies last year made exactly this point:

The supposedly unthinkable scenario … one in which insurers in states with federal Exchanges remain subject to the community rating and guaranteed issue requirements but lack a broad base of healthy customers to stabilize prices and avoid adverse selection — is exactly what the ACA enacts in such federal territories as the Northern Mariana Islands, where the Act imposes guaranteed issue and community rating requirements without an individual mandate.

This combination, predictably, has thrown individual insurance markets in the territories into turmoil. But HHS has nevertheless refused to exempt the territories from the guaranteed issue and community rating requirements, recognizing that, “[h]owever meritorious” the reasons for doing so might be, “HHS is not authorized to choose which provisions of the [ACA] might apply to the territories.”

But, it seems, the Supreme Court feels that is authorized to choose what provisions of the ACA should apply, on the grounds that doing so would make better policy, regardless of what the law actually requires.

This is essentially what Roberts did in the previous Obamacare ruling, in which he rewrote the individual mandate and the Medicaid portions of the law in order to make them pass constitutional muster.

In his scathing dissent, Justice Scalia noted,

Having transformed two major parts of the law, the Court today has turned its attention to a third. The Act that Congress passed makes tax credits available only on an “Exchange established by the State.”

This Court, however, concludes that this limitation would prevent the rest of the Act from working as well as hoped. So it rewrites the law to make tax credits available everywhere. We should start calling this law SCOTUScare.

… This Court’s two decisions on the Act will surely be remembered through the years. The somersaults of statutory interpretation they have performed (“penalty” means tax, “further [Medicaid] payments to the State” means only incremental Medicaid payments to the State, “established by the State” means not established by the State) will be cited by litigants endlessly, to the confusion of honest jurisprudence.

This decision is not disastrous because it “saved” Obamacare — it did no such thing: The Court gutted the law and let the Obama administration stuff it with whatever policy it thought best.

No, the ruling is a catastrophe because it establishes the principle that the president can unilaterally override the plain meaning of the law whenever he or she thinks that doing so will lead to a better outcome, one more in keeping with his or her policy goals.

As is often the case with elaborate government programs, things didn’t turn out the way that the planners expected. And, once again, the Supreme Court allowed the government to skate around both the Affordable Care Act and the law of unintended consequences.

This decision sanctifies the administration’s decision to defy Congress, circumvent the states, and flout the law. And as the authors of Obamacare knew, if you subsidize something, you’ll get more of it. Expect this ruling to stimulate more sloppy legislation, executive overreach, and subversion of the rule of law.

Daniel Bier

Daniel Bier is the editor of Anything Peaceful. He writes on issues relating to science, civil liberties, and economic freedom.

VIDEO: Senator Ted Cruz on Washington, Congress and “The Age of Cronyism”

U.S. Senator Ted Cruz (R-Texas) delivered a speech at The Heritage Foundation revealing the cronyism that runs deep in Washington, powered by the Washington Cartel of establishment politicians and corporate lobbyists who continue to benefit big government and big business at the expense of millions of Americans.

“Washington has done a great job of one thing – picking winners and losers, except it’s clear each time who the losers are: American families, who are struggling to pay skyrocketing health care premiums and tuition costs; it’s our community banks and marketplaces that are going out of business; it’s young entrepreneurs and small business owners.”

“What’s happening in Washington is no accident,” Sen. Cruz said. “It is a concerted effort by corporate lobbyists and establishment politicians. Lobbyists and career politicians make up the Washington Cartel. Let me explain to you how it works: A bill is set to come before Congress, and career politicians’ ears and wallets are open to the highest bidder. Corrupt backroom deals result in one interest group getting preferences over the other, although you give the other a chance to outbid them. Or even worse, a very small interest group getting special carve-outs at the expense of taxpayers.”

Sen. Cruz discussed four examples of the Washington Cartel at work:

Regarding the Export-Import Bank, Sen. Cruz said:

“It is hard to imagine an institution that is more emblematic of cronyism than the Export-Import Bank…. The Export-Import Bank kills American jobs, and often favors foreign investment over American investment. It also has this terrible record of subsidizing unfriendly regimes with problematic human rights records. In 2013, just one year, the Ex-Im bank streamed $35 million to Venezuela banks and investors; $335 million to Argentina; $1 billion to Russian financiers; and $2.7 billion to communist China.”

Regarding renewable energy mandates, Sen. Cruz said:

“A two-year extension of wind credits alone costs taxpayers more than $13 billion, which is enough to pay the monthly electricity bills for 124 million Americans. How about putting that up for a referendum? Do we continue to benefit one favored industry, or do we pay the electricity bill for 124 million Americans? You know, I don’t think that would be a close vote for the American people. And what’s interesting: it’s not a close vote in Washington. Because the only people voting in Washington are the lobbyists with bags of cash. And the lawmakers in both parties eager to get that cash.

“For decades, the federal government has teamed up with specific industries to pick winners and losers in the energy industry. Aside from further complicating an already Byzantine tax code, this type of corporate welfare has only distorted the price of energy and empowered failed companies like Solyndra.”

Regarding sugar subsidies, Sen. Cruz said:

“This form of subsidy seems particularly un-American. After all, before the Tea and Stamp Act came the Sugar Act in 1764… and it was then that the cry of ‘no taxation without representation’ was widely voiced by the colonists. You know what, we do have representation, but our representatives are not representing us.

“The Wall Street Journal reported last December that at the time, sugar was 58 percent more expensive here at home than at the global market…. This price control increases food costs for businesses and families, particularly low-income households…. From 1997 to 2011, nearly 127,000 jobs were lost in domestic sugar-using industries.”

Regarding the Internet sales tax, Sen. Cruz said:

“The Internet has been an incubator for new ideas. It has been a haven for entrepreneurial opportunity. It has allowed millions of people to create small businesses…. Today, parents can purchase Christmas presents for their kids with the click of a button; a teenager can design an app that revolutionizes the way things were done; a mom can sell her hand-made cards on Etsy; with a few taps, an Uber can come to your doorstep.

“And yet Congress is talking about passing the Orwellian-named Marketplace Fairness Act, we’ve seen the pattern of Washington fairness. What is Washington fairness? Hammer the little guy, help the big guy… [The Marketplace Fairness Act] would take every online retailer in America and tell them you must now collect sales taxes for over 9,600 different tax jurisdictions all across the country.”

Sen. Cruz concluded, “How do you break the Washington Cartel? You make the political price of doing the wrong thing higher than the price of doing the right thing, and that can only come from ‘we the people.’”

Here is the full speech by Senator Cruz at the Heritage Foundation:

Transcript of Sen. Cruz’s Remarks at the Heritage Foundation:

Thank you for the warm welcome. It is great to be with so many friends back at Heritage yet again. Today, what I want to address is the people versus the Washington Cartel. Restoring liberty in an age of cronyism. I want to start by thanking my friend Jim DeMint, who’s a big part of the reason that all of us are talking about Washington’s cronyism. Jim, when he was in the Senate, saw his colleagues eagerly packing pork into just about every bill. And he stood up and led a valiant fight against earmarks. When Jim started that fight, it was viewed as Don Quixote: tilting at windmills. And yet, today, thanks to his leadership, a Republican conference has officially sworn off earmarks.

But yet, that hasn’t solved the problem of cronyism in Washington. Indeed, just yesterday, the Senate voted for cloture for the Trade Promotion Authority Act. To leadership’s dismay, yesterday, I voted against it. Now I have always been for free trade, I campaigned on free trade. Free trade, I believe, creates more opportunities for Americans; when we open up foreign markets, it helps farmers, and ranchers, and manufacturers. And so I intended to support TPA. Indeed, when it first came up for a vote a couple of months ago, I did support TPA. But unfortunately when the package came back to the Senate floor, it had gone far beyond simply being about trade.

Once again, Congress has become enmeshed in backroom deals, and they were using TPA as an opportunity to promote, among other things, reauthorizing the Ex-Im bank and potentially even enabling President Obama’s illegal expansion of immigration.

And this seems to be an all-too-common trend in Washington. That whatever is happening, corrupt backroom deals dominate the end product.

When American families, when small businesses, and when the most vulnerable among us are hurting, Washington has a tendency to jump to action – but not to help those who need it the most. Washington is looking for solutions – for Washington. Not solutions that empower citizens across the nation to succeed.

Instead, Washington’s solutions invariably help the rich and well connected.

When the 2008 housing crisis hit millions of Americans leaving families with real estate at a fraction of the value, sunken savings accounts, and mortgages they couldn’t pay back, what did Congress do? Bail out big business. It handed out hundreds of billions of dollars to banks and institutions that were deemed “too big to fail.” Sadly the American workers is never deemed too big to fail.

This enabled the banks to concentrate even more power and, in fact, to buy out “weaker banks.” For example, PNC received $7.5 billion while National City didn’t receive anything, which then gave PNC the advantage, and then they turned around and bought out National City.

Since 2008, the big banks have only gotten bigger: As the Fed noted at the end of 2011, five banks held more than 8.5 trillion in assets… equal to 56 percent of the U.S. economy and that’s up from 43 percent five years earlier. Remember, Dodd-Frank was sold to the American people as stopping “too big to fail”. What do we see today? The big banks are even bigger.

As car-owners struggled with high gas prices in 2009, the federal government responded by handing over $80 billion to GM and Chrysler and its suppliers.

In 2010, as many hard-working Americans crawled out from under the financial crisis to revive their communities and regain their financial footing, Congress passed the Dodd-Frank Act, with 19,000 pages of regulations. No bill that large, no regulation that voluminous, could possibly be good for any small institutions. And since then, hundreds of community and regional banks have closed.

Now it’s important to understand, that was not an unintended consequence. That wasn’t, “oops, we didn’t know that was going to happen.” The lobbyists for big banks were sitting at the table when Dodd-Frank was written. It was designed by Washington to favor the big guys over the little guys. And I would note, the proponents of that regulations, inevitably, they claim they’re helping the little guy. Now, either they’re not telling the truth, or they’re really, really bad at what they do. Because every single time they jump in with massive regulations, it helps the giant corporations, and the people that get hammered are the little guys.

In 2013, When Obamacare went into effect it imposed huge burdens on small business owners and young people, union bosses and members of Congress received special favors and exemptions. The very people who wrote the law-Harry Reid and the Senate Democrats–they wanted out of it- and this administration was only too happy to oblige. Today, the taxpayers subsidize their platinum plans while millions of Americans across this country have lost their jobs, have been forced into part-time work, have lost their health insurance, have lost their doctors, are facing skyrocketing premiums. Members of Congress retain their illegal exemptions from Obamacare.

Washington’s favors have gone on for far too long.

If you take a look at a map of the U.S., our office took every county in the country and color coded it, for whether median income had gone up or gone down. It’s quite striking, that map looks almost exactly like a geological map of shale formations across this country. Indeed on the Senate floor, I put that map up with a clear plastic overlay of the shale formations. You can see up in the Bakken, North Dakota, the counties, all of those counties median income is static. You can see the Barnett shale, and the Permian and the Eagle Ford, median income has skyrocketed, you can see the Marcellus shale, median income has skyrocketed.

Although it’s interesting; Marcellus shale doesn’t end at the Pennsylvania border, the jobs do. Because the politicians in New York have decided, apparently, New Yorkers don’t want jobs, they don’t want to provide for their family; or their idiot politicians are going to stand in the way and prohibit them. So even though they have resources in New York, the very same resources that are in Pennsylvania, the line between the states is like the finger of God drew in on the ground. South of that line, there are jobs, median income has gone up. North of that line, not a single one of those counties’ median income has gone up.

You look at the Monterey shale in California-abundant resources. None of those counties have gone up because the California politicians, just like the New York politicians, think California men and women don’t want to provide for their families. But do you know the one notable exception to that rule? The counties in and around Washington, D.C. are bright, bright green. Six of the 10 most affluent counties in the country are located in the D.C. metropolis. Those who live off the federal government are getting fat and happy, and almost every other county in America, median income has stagnated.

Washington has done a great job of one thing: picking winners and losers. Except, it’s all too clear who the losers are each time; it’s American families, who are struggling to pay skyrocketing health care premiums and tuition costs; it’s our community banks and marketplaces that are going out of business; it’s young entrepreneurs and small business owners.

The majority of Americans don’t have the time, don’t have the resources to lobby Washington politicians. They are too busy going about their daily lives, working hard to provide for their families and take care of their kids.

For example, when Tesla successfully lobbied Washington for a $1.3 billion taxpayer subsidy, average Americans were hard at work, and certainly weren’t spending their time thinking about the need to subsidize rich yuppies to spend $100,000 to buy an electric car. Look, If rich people want to buy an electric car, knock yourself out. But why should we be hammering hard working taxpayers to add another car to the 4-car garage? That doesn’t make any sense.

While big government looks out for the powerful and well-connected, average Americans, over and over again, get the short end of the stick. With a ruling expected any day now in King v. Burwell, the Obama Administration has already, at the behest of the insurance companies, crafted a contingency plan that allows insurers to cancel plans in the event that their subsidies go away. But the fat cat insurers are taken care of by big government. ‘You guys are fine, here’s the contingency plan.’ But the average American taxpayer? They don’t have a contingency plan. The Obama Administration has no credible claim whatsoever for the millions of Americans who will be left to pay the full price of Obamacare’s big-government mandates.

The rich and well-connected keep getting more and more favors at the behest of hard-working Americans. And we have got to stop this. Here is a very simple rule of thumb, and it is contrary to everything our friends in the media tell us. Big government benefits big business. Small government benefits small business and hard working men and women. You will never hear that on the nighttime news because the purveyors of big government always promise they’re helping the little guy, and yet they keep getting the fat cats richer and richer and richer.

Lobbyists and career politicians today make up what I call the Washington Cartel. And it operates very much like other cartels. It operates like OPEC. I don’t know, like sheikhs, if they actually wear robes. But they nonetheless, on a daily basis are conspiring against the American people. Let me explain to you how it works:

A bill is set to come before Congress, and career politicians’ ears and wallets are open to the highest bidder. Corrupt backroom deals result in one interest group getting preferences over the other–although you give the other a chance to outbid them–or even worse, a very, very small interest group getting special carve-outs at the expense of taxpayers.

And those who don’t oblige, well, they are shunned by the Cartel – effectively locked out.

Just this week, we saw a shameful example of this as House leadership threw Representative Mark Meadows out of his chairmanship because of his principled objections to TPA. Just this morning, news broke that leadership is seeking to strip Ken Buck, another conservative in the House, of his leadership position. Why is it that Republican leadership always, always, always cuts deals with the Democrats, and with Washington, and throws overboard the conservatives that, come October and November in an election year, they are desperately asking to turn out at an election?

The Washington Cartel has amassed more and more power at the expense of the American taxpayer with the same recipe repeated over and over again.

So today, I want to look at four examples of the Washington Cartel at work. I want to talk about who their schemes are hurting. And how we can restore freedom, bring back jobs and growth and opportunity, and how we can defeat the Washington Cartel.

It is hard to imagine an institution that is more emblematic of cronyism than the Export-Import Bank.

The Export-Import Bank is essentially welfare for big corporations, both foreign and domestic.

President Franklin Delano Roosevelt, who as you all know is the source of much of progressivism, instituted the Bank.

What does the bank actually do? It provides loans and loan guarantees to hand-picked corporations. It’s one of the favored methods of cronyism: Washington handing out taxpayer money to selected giant corporations.

Now, on principle, there’s nothing wrong with loans being given except it’s not private investment. It’s not people actually risking their own capital and assessing the risk and reward. Rather, it’s funded on the taxpayer’s dime. Prior loan guarantees from the Export-Import Bank have benefited such paragons of corporate virtue as Enron and Solyndra. As it stands now, taxpayers are currently on the hook for over $100 billion in loan guarantees. If the projects succeed, the giant corporations make a profit. If they fail, the taxpayers foot the bill. Now those are pretty good odds. In Vegas, that’s called playing with the house.

As it stands, today the Ex-Im Bank funds roughly 2 percent of American exports.

And yet, of that 2 percent, from 2007 to 2013, the majority of the benefits have gone to 10 select companies. It’s good to be the king and it’s good to be a major donor to the king and to be gathering billions of taxpayer dollars because of it. Along with subsidies that support foreign companies it’s not just domestic companies. Foreign companies do very well with the Ex-Im bank, at our expense.

For example: Air India, a state-owned company, that’s right now putting at risk approximately 7,500 American jobs with the help of Ex-Im. Or Australian Roy Hill mine, to the detriment of our manufacturers and ultimately resulting in an estimated loss of $1 billion of iron ore sales here in America. That’s the taxpayers funding the government, funding foreign corporations, to hurt American workers.

Ex-Im kills American jobs, and often favors foreign investment over American investment.

It also has this terrible record of subsidizing unfriendly regimes with problematic human rights records.

In 2013, just one year, the Ex-Im bank streamed $35 million to Venezuela banks and investors, $335 million to Argentina, $1 billion to Russian financiers, and $2.7 billion to communist China. Mind you, this is at the same time Russia is invading Ukraine. We’re saying, “this is unacceptable, by the way, here’s a billion dollars.” That sort of makes the foreign policy protestations of the administration a little bit hollow.

Several companies that have received taxpayer-backed Ex-Im financing even admitted to previously doing business in Iran through their subsidiaries, undercutting efforts to sanction the Iranian regime. Moreover, the Justice Department recently indicted former Ex-Im loan officer Johnny Gutierez, with bribery chargers. More charges could be coming. And this very institution, Heritage Foundation, uncovered some 74 cases of fraud and corruption at the Ex-Im since 2009.

The Washington Cartel’s favoritism and cronyism inevitably breeds corruption. When you have government officials giving out billions of dollars of taxpayer money, suddenly the people who want that taxpayer money have every incentive in the world to further that corruption both latent and blatant.

And yet, the process of passing TPA, it appears that Senate and House leadership have made a deal to schedule a vote to reauthorize the Export-Import bank, that that was part of the price of TPA. That was a major reason why I voted, “No.” Now, in response to my criticism, leadership in both chambers have said, there is no deal. Excellent. If there is no deal, we should let Ex-Im expire and let it stay expired. For once, all Congress has to do is do nothing and if Congress is good at anything, it’s doing nothing. If leadership, as it says this week, “there is no deal on Ex-Im,” then simply do nothing, let it expire, and end the gravy train for Washington lobbyists on the Export-Import Bank.

A second example, renewable energy mandates are arbitrary government regulations that distort the free markets and artificially raise the cost for American families and job opportunities.

In 2005, Congress passed the Energy Policy Act, and one of the provisions in it was the Renewable Fuel Standard, which requires that renewable fuels be mixed into our gasoline supply.

Now, I support renewable fuels, I support biofuels, but I don’t support policies from Washington that pick winners and losers in the market.

One of the mandates included was the ethanol mandate. Over the years, it has been proven there is a demand for ethanol in the market, but ethanol should stand on its own, not atop the footstool of the government.

The ethanol mandate requires 16 billion gallons of biofuels, requiring a plot of farmland roughly equal to the size of the state of Kentucky, as a result, that has diverted corn from livestock and the food supply, and has contributed to increased food prices.

Several months ago, there was an agriculture summit in the state of Iowa. Most of the Republican candidates for president attended that summit. Every single candidate but one pledged his support for continuing the Iowa ethanol mandate. It’s very easy for conservative politicians to talk about ending cronyism, but when you’re standing in front of people who are the beneficiaries, that’s when you separate talk from action.

Big government energy mandates don’t stop with ethanol. There are tax credits for almost every form of energy. Each designed to give one industry a leg up over the other. There’s enhanced oil recovery credits for producing oil and gas from marginal wells. There’s an advanced nuclear power generation credit. Clean coal investment credits. And a credit for plugging electric and fuel cell vehicles. And of course the infamous wind energy credit.

Talking about wind: A two-year extension of wind credits alone costs taxpayers more than $13 billion, which is enough to pay the monthly electricity bills for 124 million Americans. How about putting that up for a referendum? Do we continue to benefit one favored industry, or do we pay the electricity bill for 124 million Americans? You know, I don’t think that would be a close vote for the American people. And what’s interesting: it’s not a close vote in Washington. Because the only people voting in Washington are the lobbyists with bags of cash, and the lawmakers in both parties eager to get that cash.

For decades, the federal government has teamed up with specific industries to pick winners and losers in the energy industry. Aside from further complicating an already Byzantine tax code, this type of corporate welfare has only distorted the price of energy and empowered failed companies like Solyndra.

My good friend, Senator Mike Lee, has taken the lead in previous Congresses to level the playing field, to end the special interest handouts, and stop the energy cronyism. How about instead of picking one industry after the other after the other, and benefitting them all to compete against each other, we take the taxpayer out of the game and let them fight it out on a fair field. Senator Lee has introduced the Energy Freedom and Economic Prosperity Act-a bill designed to eliminate all energy tax credits, and a bill that Senator Jim DeMint championed before Mike took lead.

A third example: sugar subsidies that artificially drive prices higher for the benefit of the few.

It should come as no surprise that another poster child for big government picking winners and losers traces its origins back to the New Deal. The Sugar Act imposed quotas on U.S. sugar production and restrictions on imports of sugar all while subsidizing U.S. production.

Now, I will note, this form of cronyism seems particularly un-American. After all, before the Tea and Stamp Act, came the Sugar Act in 1764. You’ll recall, we fought kind of a bloody revolution over that. And it was then that the cry of “no taxation without representation” was widely voiced by the colonists.

Well you know what, we, do have representation now, but our representatives aren’t representing us. They’re representing large corporations and lobbyists rather than the American people. And it’s the exact same circumstance of no taxation without representation. How about the representatives in Washington actually represent the men and women back home that we’re supposed to be working for?

The sugar program imposes restrictions on how much sugar can be sold-it provides a “benevolent” allotment for each processor and makes it illegal to sell more than the government’s designated amount.

Now, one could be forgiven for thinking this kind of centralized planning came from former Soviet apparatchiks: “You go sell that! You go sell that!” I mention the cartel. It’s what OPEC does every year. They sit around a table and say, “you go sell that. You go sell that, we’re going to conspire against the American taxpayers.” Both cartels, by the way, have the same principal victims.

Unfortunately, both Republican and Democrat administrations have kept this program essentially unchanged for eighty years-increasing the cost of sugar for Americans.

The Wall Street Journal reported last December that at the time, sugar was 58 percent more expensive here at home than at the global market. Why should Americans pay 58 percent more for sugar than people in the rest of the world? Only because the Washington cartel is taking that additional money and giving it to the select few favored lobbyists. And it’s not just sugar that you put into your coffee or your tea. Sugar is an ingredient in a great amount that we eat. From pastries to sodas-and as my two little girls will tell you, treats on a nightly basis.

And this price controlling increases food costs for businesses and families, particularly low-income households. If you’re a single mom struggling to make ends meet, if you see the food costs when you go to the grocery store and try to feed your kids, prices go up and up and up and your salary doesn’t seem to match it, part of the reason is that the Washington cartel isn’t listening to you, and they’re happy to take money from your paycheck and make fat cats even fatter. That’s the corrupt game that’s going on.

In fiscal year 2013, the average price for American raw sugar was 6 cents per pound higher than the average world price. As a result, Americans paid an unnecessary $1.4 billion extra for sugar. Now, there’s some Americans who don’t even make 1.4 billion in a year. That’s real money. And every time Washington picks winners and losers, the winners are concentrated, but the losers you could identify.

From 1997 to 2011, nearly 127,000 jobs were lost in domestic sugar-using industries. 127,000 jobs-think of the men and women who were working in chocolate factories, working in bakeries, working in soda factories, who now are unemployed, and one of the reasons is, the federal government is driving up the cost of their inputs, and valuing the interests of the lobbyist more that your job.

According to a 2006 study by the U.S. Department of Commerce, for every sugar-growing job that stems from artificially high sugar prices, approximately three manufacturing jobs are lost. Now that’s math that makes sense only in Washington, D.C.

And here’s the kicker – you want to understand the concentration: Sugar companies make up just 0.2 percent of the farms in America, anyone know what percentage of the crop industries total lobbying expenditures come from sugar? 40 percent. 0.2 percent of the farms generate 40 percent of the lobbying. Why?

Because if your lobbying is yielding 1.8 billion dollars, that’s good math. And the single mom who’s paying higher food prices, the chocolate factory owner who’s laying off, neither one of them have lobbyists. Neither one of them have a whole lot of representatives who are listing to them.

The fourth and final example: Internet sales tax.

We’ve looked at one example of how the Washington Cartel helps foreign nations and foreign investors, how it chooses winners and losers among American industries.

Now let’s look to an industry that’s been-blessedly-largely free from government regulators: the Internet. I want to turn to how it wants to make its network even broader and more intrusive – what’s the one thing that’s been left largely unmitigated by the government until now – the Internet.

The Internet has been an incubator for new ideas, it has been a haven for technological creativity. It is allowing millions of people to create small businesses. And by the way, the people who are the most freed up on the internet are the most vulnerable. It’s young people, Hispanics, African Americans, single moms, people who want a better life.

You know, it used to be, 20 years ago, if you wanted to start a business, you needed some capital. You needed to be able to buy an inventory. You needed a warehouse. You needed a distribution system. That took money. If you’re just getting started, if you’re a teenage immigrant, like my dad was in 1957, washing dishes, making 50 cents, an hour you’re not likely to have the capital to start a business. What does the internet do? It transform it. You have a good or service you want to sell– You can set up a website and suddenly you have a worldwide market. Someone clicks on the website says, “I want to buy your good or service, you can send it on Fed-Ex and boom, you can send it anywhere in the world, You know who that terrifies? Politicians in Washington. This freedom thing is very, very scary for politicians in Washington. Washington is all about power.

Today, parents can purchase Christmas presents for their kids with the click of a button. A teenager can design an app that revolutionizes the way things are done. A mom can sell her hand-made cards on Etsy. Or with a few taps, an Uber can come to your doorstep.

And by the way, the next time you take Uber-I’ll let you know, I don’t have a car in Washington. Uber is transformational. The next time you take an Uber, ask the Uber driver how he or she likes his job. I have yet to find an Uber driver who isn’t thrilled at the freedom of becoming a small business owner that the Internet has enabled.

And yet, what is Congress talking about doing ? It’s talking about passing the Orwellian-named Marketplace Fairness Act. Now, we’ve seen the pattern of Washington fairness. What is Washington fairness? Hammer the little guy, help the big guy. That’s very fair to lobbyists.

What would the Marketplace Fairness Act do? It would take every online retailer in America and tell them you must now collect states taxes for over 9,600 taxing jurisdictions all across this country, in real time. I want you to think about it. Let’s suppose you’re that single mom who started the business you’re selling online. You’re supposed to collect the Albany school taxes. Now Bret, do you know what the Albany school tax is? Do you know there’s a hearing scheduled next week to try to change it? Well, if you decide to start a small business, you’re expected to know.

And you could face an audit from 9,600 jurisdictions across this country if you haven’t correctly collected the Albany school tax, and you don’t know that they raised it by a quarter point in their last vote., which I have no idea if they did or not.

Why does the Marketplace Fairness Act have support? It has support because it’s a perfect storm for lobbyists. Number one, the Big Box stores, a major bricks and mortar retailers, they want to hammer the heck out of these online retailers. But here’s the interesting thing that’s shifted, so do the big online retailers. Of the 20 largest online retailers, 19 of them have physical presences, and so collect sales taxes in each of the states that has sales taxes. So suddenly you have the big box stores, the brick and mortar retailers, the big guys, and the giant online retailers, joining forces and suddenly they have a common enemy: all of these pesky little startups that have the temerity to try to take their customers.

And in Washington, there’s nothing more beautiful than when the lobbyists all align. When all the money is pointing in the same direction. Suddenly you see Republicans, and Democrats saying, “that is an inspired policy.” And yet, all of the millions of young people, of entrepreneurs, of people with an idea that want to topple the next giant company, they don’t have a single lobbyist. The American people are with us on this. The 2013 Gallup poll showed 57 percent of likely voters opposed taxing the Internet. Among young people, the demographic that represents the future of this country, 73 percent oppose a tax on the Internet. We should stand with the people. It is time to break the Washington Cartel.

We should stand with the people. It is time to break the Washington Cartel.

Instead of cutting blue-collar jobs by investing millions in foreign mining corporations, we should welcome jobs and production here at home. Instead of giving ethanol producers an automatic check, we should let the market determine their viability, and stop hurting farms from Connecticut to California. Instead of forcing restaurants and bakers and families to pay more for sugar – and undercut competition – we should welcome lower prices. And instead of handing over more power to big corporations and regulators, let’s keep the Internet free and encourage young entrepreneurs to keep innovating and to keep government’s hands off the Internet.

How we beat back the Washington Cartel, how do we restore power to the people?

The answer is simple – Americans across the country rise up, they engage on the issues, and we bring back the voice of the people.

The book of Ecclesiastes tells us there’s nothing new under the sun. I think where we are today is very much like the late 1970s. I think the parallels between Jimmy Carter and Barack Obama are uncanny: the same failed domestic policy, the same misery, stagnation, and malaise, and the same feckless and naiveté foreign policy. In fact, the very same countries, Russia and Iran, openly laughing at and mocking the President of the United States. The one person in America thrilled with the job Barack Obama’s doing is Jimmy Carter.

Why does that analogy give me so much hope? Because we know what comes next. The late ‘70s and 1980s, there was a grassroots movement of millions of men and women who rose up and became the Reagan revolution, and it didn’t come from Washington – Washington despised Ronald Reagan. If you see a candidate who Washington embraces, run and hide. And in 1980, Reagan rose up to break the Washington Cartel. How did he do it? He changed the rules: 1978, 1979, Reagan didn’t get on a plane and fly to Washington and sit down with the old bulls in Congress, sit down with Republicans and say, come on guys, you got to stand for something. He recognized that then and now they weren’t listening to the American people. Instead, he took the case to the American people. And it transformed this nation. How do you change, how do you break the Washington Cartel. You change the rules. You know, there’s an old saying that politics is Hollywood for ugly people.

But there is nothing that focuses the minds of elected politicians like the prospect that they might be voted out of office and have to find an honest job. How do you break the Washington Cartel? You make the political price of doing the wrong thing higher than the political price of doing the right thing, and that can only come from ‘we the people.’ It’s the only power strong enough. That’s what the Reagan revolution demonstrated. Washington despised Reagan until the revolution swept in, and suddenly a bunch of politicians said holy cow, ‘I’m not messing with that,’ and magically they supported lower taxes and lower regulations and stopped the favoritism and standing up and defeating the Soviet Union.

I think 2016 will be an election like 1980. As Reagan said, we win by painting in bold colors and not pale pastels.

I am going to close with a story.

We all know the story of the Wright brothers.

But a name we don’t as often hear is that of Samuel Langley. The Department of War gave him $50,000 to create a flying machine. Upon its launch, “it fell like a ton of mortar,” according to one reporter.

On December 17, 1903, only 9 days after Langley’s second experiment failed, two young Ohio boys with only $2,000 set out at Kitty Hawk, and to become the first men to sail in the air.

$50,000 on failed government programs picking winners and losers versus two entrepreneurs, two brothers with a vision and a dream and just $2,000. One a miserable failure; the other transformed the world.
That is power of American innovators free from the government. It’s the can-do spirit that has propelled scientists and entrepreneurs and immigrants who came with nothing, pioneers, and farmers to make this land the greatest nation on earth.

And it remains just that if we come together and break the Washington Cartel that is telling us far too much about what we can do and can’t do. And if we instead return the power to the people so they can do what they have always done best – achieve the unimaginable and leave a landscape of greater opportunities for generations to come.

The Left Will Always Blame the GOP on Obamacare

With the 2016 elections right around the corner, conservatives must begin immediately preparing to rebut the massive Democratic Party/mainstream media, symbiotic messaging operation. I read a piece this week by the Washington Post’s Greg Sargent that summarizes the far Left’s new Obamacare messaging strategy in the event of a Supreme Court loss in the King v. Burwell (Obamacare subsidies) case.

Here is a short summary of where we are. The far Left is terrified that the Supreme Court is going to rule against the Obama administration in King v. Burwell, essentially voiding the Obamacare subsidies in the states using the federal exchange even though the legislative language in the law regarding the “subsidies” was written this way to punish states for failing to set up state exchanges. The far Left and the Obama administration are disputing this point despite clear, videotaped evidence of Professor Jonathan Gruber, one of Obamacare’s lead architects, stating otherwise.

Now, the Obama administration has never let videotaped evidence of their prior contradicting statements dissuade them from continuing to lie to the American people (i.e. “If you like your plan, you can keep your plan. Period.”) but, in this case, their lies are especially egregious because their plan to withhold subsidies from states that refused to set up a state exchange was designed to punish the citizens of that state for not complying with Obamacare. When the punishment backfired because of public opposition to Obamacare, and support for the governors and legislators who refused to comply with its exchange language only increased, they went with plan B: lie. As usual, after their strategic miscalculation they are desperately trying to find a way to blame Republicans for this disaster, although not one Republican in the House or Senate voted for the final version of Obamacare.

The far Left’s messaging strategy to avert political disaster because of their tactical miscalculation regarding the Obamacare subsidies is to say that the Republicans have “taken away” the subsidies and pin the blame on Republicans if the court rules against the Obama administration. But, here’s the catch; the Dems destroyed our already-troubled healthcare system all by themselves by unilaterally supporting Obamacare. The reason the Obamacare “subsidies” (which are your tax payer dollars given back to you after the government takes a cut) are necessary is because insurance costs are exploding because Obamacare forces Americans to buy expensive insurance they do not want and do not need. And the reason these “subsidies” may be taken away is because the Democrats unilaterally wrote and passed the law this way to punish Americans for resisting this legislative debacle.

Unsurprisingly, when you combine the mandate to purchase health insurance policies, which included multiple unwanted and unneeded services with the community rating and guaranteed issue provisions designed to redistribute costs according to government edicts, you have a recipe for explosive healthcare cost growth. Of course, none of this was a mystery to the Republican Party when they warned America about the coming storm of healthcare premium hikes, a warning the mainstream media largely downplayed to ensure the “wizard” stayed well-hidden behind the curtain.

So here it is in a nutshell: Obamacare was shoved down your throats using parliamentary trickery. Obamacare forced you to buy expensive insurance you don’t want or need at dramatically inflated costs to compensate for the redistributive, big-government, effort to price-control the health insurance market. Obamacare taxed you to gather a honey pot of money. Obamacare then used this honey pot of taxpayer money to “give back” to Americans to pay for their new, and more expensive insurance.

You will never fix this legislative disaster by doubling down on absurdity. The economics won’t work because they can’t work. The Republican Party must prepare their counter message right now to explain to the American people the horrible tsunami that Obamacare has created. If we allow the far Left to continue to distort markets, engage in massive income redistribution operations, and instill more big-government coercion schemes to force compliance on the American people by simply pledging to prolong the misery by “fixing” the subsidy system and continuing the misery, then we are no better than the president who lied to us to sell us this jalopy.

EDITORS NOTE: This column originally appeared in the Conservative Review. The feature image of the Supreme Court building is by Tom Williams | AP Photo.

Marijuana: Lies, Damn Lies and Julia Negron


Julia Negron

Have you ever heard the name Julia Negron who lives in the Sunshine State? Negron, her former husband(s), mother, sister and son were drug abusers. Her mother and sister died from drug overdoses. You would think Negron would be against all forms of drug use and abuse. You would think she would be a proponent of the Just Say No campaign. You would be wrong, in fact she is feverishly working to legalize drug use.

Negron believes that no one should be arrested, tried or convicted for the use, abuse, selling or trafficking of drugs. She is for legalizing the use of marijuana in Florida. Negron is the Director of PATH Florida, and a Steering Committee member of Moms United to End the War on Drugs.

On July 18th, 2015 Negron will be speaking at the Venice United Church of Christ monthly meeting. According to the meeting notice posted on Facebook, “Her passion is decriminalization and ending the mass incarceration of drug offenders.”

There is a problem with Negron’s pitch, it is based upon an ideology, not the facts.

Julia Negron claims to be a Drug Policy Alliance (DPA) grantee according to her Facebook page. The Drug Policy Alliance is funded by George Soros. The Drug Policy Alliance is focused on ending the war on drugs, calling it a failure. The question is what would make the War on Drugs a success? Negron has photos on her Facebook page carrying end the drug war signs (with the DPA logo) and photos of her in New York at the DPA headquarters.

Negron may use Open Society Foundation as a reference for her data….the Open Society Foundation (OPF) is another project funded by George Soros. According to the OP website they believe that, “Prohibition-based policies have led to a rise in drug-related violence, prison overcrowding, and an increase in HIV epidemics. The Open Society Foundation’s support organizations that put forward alternatives.” Alternatives that OPF supports include: marijuana legalization and Onsite, facilities where heroin users can bring their drugs and have them injected by staff members. George Soros has made no attempts to deny and openly admits that he is for legalization of all drugs.

Negron talks about the “mass incarceration of drug offenders.” This is not true based on prison data. The two charts below show what Negron is saying is not born out by the facts on those in prison for marijuana use:

prison myth


The majority of “drug charges” are actually paper citations not resulting in a physical arrest or jail time. Those who are in jail or prison on marijuana charges, the 0.1 or 0.3 percent, are cases that have been pleaded down from trafficking large amounts of drugs and related charges.

Negron is a promoting one side of the story, when both sides deserve equal time. Perhaps Reverend Donald H. Wilson, the Senior Pastor of the Venice United Church of Christ, would want his flock to hear both sides of this important social issue?

As Negron so very well knows drugs kill.


STUDY: Scant Evidence that Medical Pot Helps Many Illnesses

Some Physicians Concerned about Cannabis Oil Use

Boston Hospital fires Physician for Discussing ‘Gay’ Medical Dangers!

On March 30, a major Harvard-affiliated hospital in Boston, Beth Israel Deaconess Medical Center (BIDMC), expelled a well-respected urologist from its medical staff because he voiced concerns about the unhealthy nature of homosexual behavior and objected to the hospital’s aggressive promotion of “gay pride” activities.

Beth Israel Deaconess Medical Center is a sprawling hospital complex in Boston.

People trust the medical profession to protect them – on both the personal and public health levels. But in recent years, a nightmare has taken hold. Now, a medical doctor is being expelled from his hospital for telling the politically-incorrect truth about a serious medical issue. What you are about to read is truly Orwellian.

Dr. Paul Church has been a urologist on the BIDMC staff in Boston for nearly 30 years. He is a member of the Harvard Medical School faculty. He has done research on diagnosing prostate and bladder cancer, and has been a frequent volunteer for medical mission projects in Mexico and Africa. He has also spoken before educational and civic groups on the subject of high-risk sexual behaviors.

Voicing serious medical (and moral) concerns

Over a decade ago, Dr. Church became concerned about the hospital’s aggressive promotion of and involvement in LGBT activities — including Boston’s annual “Gay Pride Week” – and its emphatic push for staff participation in them. He felt compelled to speak out.

Through emails to hospital officials and later posting on the hospital’s Intranet system, Dr. Church cited irrefutable medical evidence that high-risk sexual practices common to the LGBT community lead to (among other things) a higher incidence of HIV/AIDS, STD’s, hepatitis, parasitic infections, anal cancers, and psychiatric disorders.

Promoting such behavior, he said, is contrary to the higher mission of the healthcare facility to protect the public welfare and encourage healthy lifestyles.  Dr. Church also reminded the administration that its staff and employees represent a diversity of moral and religious views, and many believe that homosexuality is unnatural and immoral.

The BIDMC contingent at a “Gay Pride” parade in Boston. [MassResistance photo.]

Response by the hospital: Attempts to silence and censor Dr. Church

The hospital did not at any time dispute the truth of his medical statements, nor did they address his other concerns.

They did not claim that Dr. Church ever discussed this with patients, or treated patients any differently if they were involved with these behaviors.

Instead Dr. Church was met with increasingly harsh efforts by the hospital administration to silence and censor him. They told him that his admonitions about homosexual behavior constituted “discrimination and harassment,” were “offensive to BIDMC staff,” and could not be tolerated.

In July 2011, he was called into the Chief of Surgery’s office and told he should consider resigning or else he would face an investigation. He refused to resign. So a few months later a formal “Peer Review Committee” of BIDMC staff physicians was called together to “assess” his “conduct.” He again presented them with the medical facts, which they did not dispute, but ignored. The committee instead sent him a “letter of reprimand” ordering, “You shall have no communications [in any manner, to anyone in the hospital] concerning your opinion about sexual orientation, homosexuality, or other protected status.”

It was an unusual order – that a physician be banned from discussing critical medical facts relating to his expertise, that could affect the health of people the hospital serves.

Dr. Church subsequently requested that the hospital not send any more promotions about LGBT activities to his email or hospital web connection. The hospital refused that request and continued sending them to him.  (They rejected the idea that these communications constituted a religious-based harassment of Dr. Church, or the possibility that such a “gag order” was illegal.)

As the emails and postings sent to Dr. Church by the hospital grew more frequent — as BIDMC’s LGBT activities expanded — he again voiced his concerns via a brief posted comment on one occasion in 2013 and twice in 2014.

Dr. Church is expelled from the staff

The hospital reacted with vehemence. In September 2014 a special “Investigating Committee” was assembled to investigate him. “Charges” were brought against him.

But also, over the next few months the Investigating Committee and BIDMC’s president received an outpouring of letters from colleagues, ethicists, public health experts, and others supporting Dr. Church and his advocacy for healthy behaviors. But the committee was not moved by the concerns of Dr. Church or those who wrote letters on his behalf.

In January 2015 the Investigating Committee submitted its findings to the hospital’s highest body and most prominent group, the 25-member Medical Executive Committee, which then met in February to decide on Dr. Church’s fate. At the meeting they allowed Dr. Church to read a statement defending himself.

On March 30, 2015, the Medical Executive Committee announced its decision. Dr. Church was informed that because of his “unsolicited views about homosexuality that were offensive to BIDMC Staff,” he was being terminated from the hospital staff. Further, he was told that that his statements on the subject of homosexuality were “inconsistent with the established standards of professional conduct” and constituted a violation of the hospital’s “Discrimination and Harassment Policy.”  It was beyond belief.

Read an expanded description and timeline of these events HERE.

Appeal hearing

According to the hospital’s bylaws, Dr. Church can ask for an appeal hearing, which he has done. It has been scheduled for the end of July. However, it is not a “legal” process per se, but completely run by hospital rules. Dr. Church can at least be accompanied by an attorney, which was not allowed in any of the previous hearings.

Given the way the hospital has handled this so far, the odds of a successful appeal are not good.

A few scenes from the Boston “Gay Pride” parade:

Sado-masochism – man in high-heel boots with lash leads other man by a leash around his neck.
[MassResistance photos]


Left: Man in dress – part of “transgender” group.

Right: Hatred of Christianity is a common theme.

Is this the future for us all?

Dr. Church has essentially done what virtually no one in the pro-family establishment has been willing to do for at least a decade: unflinchingly tell the medical and moral truth about homosexual behavior. In our opinion, that failure is the main reason why we have lost so much ground in the courts, the public forum, and just about everywhere else.

And this is what it’s come to. The insanity of this decision by a major hospital against a respected physician is staggering. It is one thing for the education system, big business, or even government to succumb to the lunacy of “political correctness.” But when the medical profession do so – especially such an irrational and oppressive manner – it is time for all of us to be fearful. Is this the future?

If you do nothing else, make sure that Beth Israel Deaconess Medical Center hears from you – and as many others as you can get — on this. Dr. Church has put his career on the line for all of us. It’s time for us to step up for him.

Contact the president of BIDMC right now. Tell him this is an unacceptable way for a hospital to act. Dr. Church must be reinstated to his position immediately!

Kevin Tabb, MD
President and CEO, BIDMC
Feldberg 230
Boston, MA  02215
Phone: 617-667-4607
Fax: 617-667-3626

National Center on Sexual Exploitation launches Resource Center

The mission of the National Center on Sexual Exploitation is defending human dignity and confronting sexual exploitation. It’s Vision is to insure all individuals have a right to be free from the effects of pornography and all other forms of sexual exploitation. In order to provide help to those in need the National Center on Sexual Exploitation has launched a new Resource Center website for those who want more information and become educated on this topic.

The Resource Center currently includes help for:

  • Those who are struggling with pornography and sex addictions
  • Partners and spouses of those who struggle
  • Parents
  • Survivors and victims of sexual exploitation
  • Technology Solutions & Tools
  • Ways you can take action
  • Talking Points
  • Free Handouts and Tools
  • Links to finding Research

The Center will soon launch its new website  www.EndSexualExploitation.org.

RELATED RESOURCE: Trucking and Human Trafficking

5 Reasons the FDA’s Ban on Trans Fat Is a Big Deal by Walter Olson

The Obama administration’s Food and Drug Administration today announced a near-ban, in the making since 2013, on the use of partially hydrogenated vegetable fats (“trans fats”) in American food manufacturing.

Specifically, the FDA is knocking trans fats off the Generally Recognized as Safe (GRAS) list. This is a big deal and here are some reasons why:

1. It’s frank paternalism. Like high-calorie foods or alcoholic beverages, trans fats have marked risks when consumed in quantity over long periods, smaller risks in moderate and occasional use, and tiny risks when used in tiny quantities. The FDA intends to forbid the taking of even tiny risks, no matter how well disclosed.

2. The public doesn’t agree.2013 Reason-RUPE poll found majorities of all political groups felt consumers should be left free to choose on trans fats.  Even in heavily governed places like New York City and California, where the political class bulldozed through restaurant bans some years back, there was plenty of resentment.

3. The public is also perfectly capable of recognizing and acting on nutritional advances on its own. Trans fats have gone out of style and consumption has dropped by 85 percent as consumers have shunned them.

But while many products have been reformulated to omit trans fats, their versatile qualities still give them an edge in such specialty applications as frozen pizza crusts, microwave popcorn, and the sprinkles used atop cupcakes and ice cream. Food companies tried to negotiate to keep some of these uses available, especially in small quantities, but apparently mostly failed.

4. Government doesn’t always know best, nor do its friends in “public health.” The story has often been told of how dietary reformers touted trans fats from the 1950s onward as a safer alternative to animal fats and butter.

Public health activists and various levels of government hectored consumers and restaurants to embrace the new substitutes. We now know this was a bad idea: trans fats appear worse for cardiovascular health than what they replaced. And the ingredients that will replace minor uses of trans fats – tropical palm oil is one – have problems of their own.

5. Even if you never plan to consume a smidgen of trans fat ever again, note well: many public health advocates are itching for the FDA to limit allowable amounts of salt, sugar, caffeine, and so forth in food products. Many see this as their big pilot project and test case.

But when it winds up in court, don’t be surprised if some courtroom spectators show up wearing buttons with the old Sixties slogan: Keep Your Laws Off My Body.

Walter Olson

Walter Olson is a senior fellow at the Cato Institute’s Center for Constitutional Studies.

EDITORS NOTE: This post first appeared at Cato.org.

Bed Bugs Are the New Plague by Jeffrey A. Tucker

It must have been pretty rotten to sleep in, say, the 12th century Europe. Your floor was dirt. Your mattress was made from hay or bean husks. The biggest drag of all must have been the bed bug problem. It’s not so fabulous to lie there asleep while thousands of ghastly critters gnaw on your flesh. You wake with rashes all over your body.

They heal gradually in the course of the day, but, at night, it starts all over again.

No, they don’t kill you. But they surely make life desperate and miserable. They know where you are. They sense the carbon dioxide. They are after your blood, so they can stay alive. No wonder some people have been driven to suicide.

It stands to reason that among the earliest priorities of civilized life was the total eradication of bed bugs. And we did it! Thanks to modern pesticides, most especially DDT, generations knew not the bed bug.

That is, at least in capitalist countries. I have a friend from Russia whose mother explained the difference between capitalism and socialism as summed up in bed bugs. In the 1950s, capitalist countries had eliminated them. The socialist world, by contrast, faced an epidemic.

But you know what? They are back with an amazing ferocity, right here in 21st century America.

There is a new book getting rave reviews and high sales: Infested: How the Bed Bug Infiltrated Our Bedrooms and Took Over the World.

You can attend Bed Bug University, which is “an intensive four day course that covers bed bug biology and behavior, treatment protocols and explores the unique legal challenges and business opportunities of bed bugs.”

You can browse the Bed Bug Registry, with dozens of reports coming in from around the country. You can call a local company that specializes in keeping them at bay.

Welcome to the post-DDT world in which fear of pesticides displaced fear of the thing that pesticides took away. Oh, how glorious it is to embrace nature and all its ways — until nature begins to feed on you in your sleep.

The various restrictions and bans from the 1970s have gradually brought back the nightmares that wonderful, effective, killer chemicals took away. Some people claim that today not even DDT works because the new strain of bed bug is stronger than ever.

Forget innovating with new pesticides: the restrictions are just too tight. There is not a single product at your local big box hardware store that can deal with these blood suckers. And the products that more-or-less work that are available online, such as Malathion, are not approved for indoor use — and I know for sure that everyone obeys such rules!

In our current greeny ethos, people are suggesting “natural” methods such as: “take all of your laundry and bedding to the Laundromat and wash and dry it at high temperatures.”

Why not do it at home? Well, thanks to federal regulations, your hot water heater is shipped with a high temperature of 110 degrees, which is something like a luxurious bath for the bed bug. Add your detergent — which, by government decree, no longer has phosphates — and your wash turns into Mr. Bubble happy time for Mr. Bed Bug.

So you could stand over gigantic pots of boiling water in your kitchen, fishing beddings in and out, beating your mattresses outside with sticks, and otherwise sleeping in plastic bags, like they do in the new season of “Orange Is the New Black.” You know, like in prison. Or like in the 12th century.

No matter how modernized we become, no matter how many smartphones and tablets we acquire, we still have to deal with the whole problem of nature trying to eat us — in particular, its most wicked part, the man-eating insect. There is no app for that.

Google around on how many people die from mosquitos, and you are immediately struck by the ghastly reality: These things are even more deadly than government. And that’s really saying something.

But somehow, starting in the late 1960s, we began to forget this. Capitalism achieved a wonderful thing, and we took it for granted. We banned the chemicals that saved us, and gradually came to prohibit the creation of more. We feared a “Silent Spring” but instead created a nation in which the noise we hear at night is of an army of bugs sinking their teeth into our flesh.

A little silence would be welcome.

So here we are: mystified, afraid to lie down and sleep, afraid to buy a sofa from Craigslist, boiling our sheets, living in fear of things we can’t see. It’s the Dark Ages again. It gets worse each year, especially during summer when the bed bugs leave their winter hibernation and gather en masse to become our true and living nightmare.

How bad does it have to get before we again unleash the creative forces of science and capitalism to restore a world that is livable for human beings?

Jeffrey A. Tucker

Jeffrey Tucker is Director of Digital Development at FEE, CLO of the startup Liberty.me, and editor at Laissez Faire Books. Author of five books, he speaks at FEE summer seminars and other events. His latest book is Bit by Bit: How P2P Is Freeing the World.

Hidden Camera: Veterans Administration ‘Turning Veterans into Drug Addicts’

Project Veritas caught on hidden camera, Deputy Veterans Administration Chief of Patient Services (for the entire VA) Maureen McCarthy, MD, said many of our military veterans “have drug problems, some of which are caused by us and our prescribing.”

In the undercover video, she admitted that the combination of “opiates, like morphine and benzodiazepine like Ativan and Klonopin” are like “candy” for a lot of veterans, “it’s like they want it, they want it, they want it.”

“He had a ten foot step ladder and a rope,” says Bob Cranmer, the father of a Marine Iraq veteran named David who recently took his own life. “And for some reason decided to hang himself.”

On average each day, twenty-two U.S. veterans take their own life. In David’s case, he waited over a year to be seen by the VA, and when they did eventually see him, they prescribed him a combination of opiates and psycho-pharmaceuticals very similar to the ones described by Dr. McCarthy in the undercover video. When you watch the video above/on the right, you will see one VA official after another saying what Nurse-Anesthetist Joe Salmon admitted: “The VA does push pills.”

“In my opinion, they are creating drug addicts,” opined a senior volunteer at a New York Veterans Administration facility.

A VA facility in Wisconsin is under heavy fire for patient deaths due to over medication. This video illustrates that the over-medication problem extends to facilities in Pittsburgh, Little Rock, Buffalo, Minneapolis and the DC area. As an institution, the VA is far too eager to simply write prescription after prescription and quickly move on to the next patient, instead of dealing with the actual problems veterans face on a daily basis.

Bob Cranmer blames his son’s suicide on the VA. So do a lot of VA staffers, when caught on undercover video. Watch it here to find out why.

Our veterans deserve better!

“Paid Family Leave” Is a Great Way to Hurt Women by Robert P. Murphy

In an article in the New Republic, Lauren Sandler argues that it’s about time the United States join the ranks of all other industrialized nations and provide legally guaranteed paid leave for pregnancy or illness.

Her arguments are similar to ones employed in the minimum wage debate. Opponents say that making particular workers more expensive will lead employers (on aggregate) to hire fewer of them. Supporters reject this tack as fearmongering, going so far as to claim such measures will boost profitability, and that only callous disregard for the disadvantaged can explain the opposition.

If paid leave (or higher pay for unskilled workers) helps workers and employers, then why do progressives need government power to force these great ideas on everyone?

The United States already has unpaid family leave, with the Family and Medical Leave Act (FMLA) signed into law by President Clinton in 1993. This legislation “entitles eligible employees … to take unpaid, job-protected leave for specified family and medical reasons with continuation of group health insurance coverage under the same terms and conditions as if the employee had not taken leave.” Specifically, the FMLA grants covered employees 12 workweeks of such protection in a 12-month period, to deal with a pregnancy, personal sickness, or the care of an immediate family member. (There is a provision for 26 workweeks if the injured family member is in the military.)

But “workers’ rights” advocates want to move beyond the FMLA, in winning legally guaranteed paid leave for such absences. Currently, California, New Jersey, and Rhode Island have such policies.

The basic libertarian argument against such legislation is simple enough: no worker has a right to any particular job, just as no employer has the right to compel a person to work for him or her. In a genuine market economy based on private property and consensual relations, employers and workers are legally treated as responsible adults to work out mutually beneficial arrangements. If it’s important to many women workers that they won’t forfeit their jobs in the event of a pregnancy, then in a free and wealthy society, many firms will provide such clauses in the employment contract in order to attract qualified applicants.

For example, if a 23-year-old woman with a fresh MBA is applying to several firms for a career in the financial sector, but she has a serious boyfriend and thinks they might one day start a family, then — other things equal — she is going to highly value a clause in the employment contract that guarantees she won’t lose her job if she takes off time to have a baby. Since female employment in the traditional workforce is now so prevalent, we can expect many employers to have such provisions in in their employment contracts in order to attract qualified applicants. Women don’t have a right to such clauses, just as male hedge-fund VPs don’t have a right to year-end bonuses, but it’s standard for employment contracts to have such features.

Leaving aside philosophical and ethical considerations, let’s consider basic economics and the consequences of pregnancy- and illness-leave legislation. It is undeniable that providing even unpaid, let alone paid, leave is a constraint on employers. Other things equal, an employer does not want an employee to suddenly not show up for work for months at a time, and then expect to come back as if nothing had happened. The employer has to scramble to deal with the absence in the meantime, and furthermore doesn’t want to pour too much training into a temporary employee because the original one is legally guaranteed her (or his) old job. If the employer also has to pay out thousands of dollars to an employee who is not showing up for work, it is obviously an extra burden.

As always with such topics, the easiest way to see the trade-off is to exaggerate the proposed measure. Suppose instead of merely guaranteeing a few months of paid maternity leave, instead the state enforced a rule that said, “Any female employee who becomes pregnant can take off up to 15 years, earning half of her salary, in order to deliver and homeschool the new child.” If that were the rule, then young female employees would be ticking time bombs, and potential employers would come up with all sorts of tricks to deny hiring them or to pay them very low salaries compared to their ostensible on-the-job productivity.

Now, just because guaranteed leave, whether paid or unpaid, is an expensive constraint for employers, that doesn’t mean such policies (in moderation) are necessarily bad business practices, so long as they are adopted voluntarily. To repeat, it is entirely possible that in a genuinely free market economy, many employers would voluntarily provide such policies in order to attract the most productive workers. After all, employers allow their employees to take bathroom breaks, eat lunch, and go on vacation, even though the employees aren’t generating revenue for the firm when doing so.

However, if the state must force employers to enact such policies, then we can be pretty sure they don’t make economic sense for the firms in question. In her article, Sandler addresses this fear by writing, in reference to New Jersey’s paid leave legislation,

After then-Governor Jon Corzine signed the bill, Chris Christie promised to overturn it during his campaign against Corzine. But Christie never followed through. The reason why is quite plain: As with California, most everyone loves paid leave. A recent study from the CEPR found that businesses, many of which strenuously opposed the policy, now believe paid leave has improved productivity and employee retention, decreasing turnover costs. (emphasis added)

Well, that’s fantastic! Rather than engaging in divisive political battles, why doesn’t Sandler simply email that CEPR (Center for Economic and Policy Research) study to every employer in the 47 states that currently lack paid leave legislation? Once they see that they are flushing money down the toilet right now with high turnover costs, they will join the ranks of the truly civilized nations and offer paid leave.

The quotation from Sandler is quite telling. Certain arguments for progressive legislation rely on “externalities,” where the profit-and-loss incentives facing individual consumers or firms do not yield the “socially optimal” behavior. On this issue of family leave, the progressive argument is much weaker. Sandler and other supporters must maintain that they know better than the owners of thousands of firms how to structure their employment contracts in order to boost productivity and employee retention. What are the chances of that?

In reality, given our current level of wealth and the configuration of our labor force, it makes sense for some firms to have generous “family leave” clauses for some employees, but it is not necessarily a sensible approach in all cases. The way a free society deals with such nuanced situations is to allow employers and employees to reach mutually beneficial agreements. If the state mandates an approach that makes employment more generous to women in certain dimensions — since they are the prime beneficiaries of pregnancy leave, even if men can ostensibly use it, too — then we can expect employers to reduce the attractiveness of employment contracts offered to women in other dimensions. There is no such thing as a free lunch. Mandating paid leave will reduce hiring opportunities and base pay, especially for women. If this trade-off is something the vast majority of employees want, then that’s the outcome a free labor market would have provided without a state mandate.

Robert P. Murphy

Robert P. Murphy is senior economist with the Institute for Energy Research. He is author of Choice: Cooperation, Enterprise, and Human Action (Independent Institute, 2015).

FLORIDA: 25 Reasons NOT to Take Federal Dollars to Expand Medicaid

Monday, The Florida Legislature opened a special session to decide on the state budget and debate how Florida should move forward in regards to our healthcare future. The Senate offered a plan that supporters, including many business interests, sugarcoated in conservative buzzwords such as “a free market approach,” even though the plan is anything but. As we say here at The James Madison Institute, pro-business isn’t always pro-free market. House Republicans and Governor Rick Scott, for good reason, oppose expanding federal control and a flawed program in our state. The Senate approved its plan Wednesday and the House is set to debate the bill today and vote on it this Friday [May 5th].

The Tampa Bay Times recently released an editorial giving 25 reasons Florida should take the money and encouraging Floridians to “tell (lawmakers) to listen to the powerful moral and financial arguments for taking the money and providing access to affordable health care.” Yes, there is a powerful moral and financial argument to be made. Yes, solutions exist to provide access to affordable healthcare. No, the Times does not have the right answers for either.

As Forbes opinion editor, senior fellow at the Manhattan Institute for Policy Research, and friend of JMI, Avik Roy points out, “Progressives have long enjoyed wielding the straw man. “If you oppose expanding Medicaid,” they say, ‘you oppose health care for the poor. Plain and simple.’ But the truth is, if you support expanding Medicaid, you’re doubling down on a failed system, one that shuts the door on real reforms that could provide quality health care to those who most need it.”

The James Madison Institute offers “25 Reasons NOT to Take Federal

Dollars to Expand Medicaid.” Share our infographic today and tomorrow through social media. RT on Twitter here. Share through Facebook here. Find on our website here.

  1. Medicaid already takes up more than 30% of Florida’s budget: Currently, Medicaid takes up more than 30 percent of Florida’s budget and crowds out other public priorities such as education, public safety and infrastructure.
  2. Medicaid payment rates are well below market rates:Payments to healthcare providers under Medicaid are well below market rates. Exasperating this system would be anathema to free-market reforms in healthcare.
  3. The federal government is already $18 trillion in debt; Obamacare costs rise daily:The federal government is $18 TRILLION in debt with the cost of Obamacare rising daily, requiring even more money from taxpayers to feed the beast.
  4. The supply of doctors accepting Medicaid is shrinking: As a consequence of federal Medicaid price controls, the supply of doctors that will accept Medicaid patients is shrinking — this shrinkage will become more rapid under an expansion of Medicaid.
  5. Medicaid expansion leads to greater use of ERs, not less: A March 2015 survey of 2,098 emergency-room doctors showed Medicaid recipients newly insured under the health law are struggling to get appointments or find doctors who will accept their coverage, and consequently wind up in the ER.
  6. Arkansas’s “private option” costs state taxpayers tens of millions: Medicaid expansion is not working in Arkansas. The Arkansas legislature passed a “private option” healthcare plan similar to what the Senate in Florida is proposing and the price tag is rising by the month under Obamacare’s Medicaid expansion and state taxpayers will now have to pay tens of millions to cover the unexpected costs. The proposed plan in Florida could cost far more than projections indicate.
  7. Mandated premiums create inefficiencies in supply and demand for healthcare services: When premiums for healthcare plan participants are mandated and set by legislative action, it is nothing more than market distorting price controls, which ultimately create inefficiencies in the supply and demand for healthcare services
  8. Feds won’t approve Senate’s special waivers; Florida left with traditional Obamacare expansion: The Senate’s plan includes a requirement that enrollees work, attend classes or prove they are seeking work in order to maintain eligibility for healthcare coverage. However, to date the federal government has rejected all state-run expansion plans with a work requirement. They will deny this special waiver and we’ll be left with traditional Medicaid expansion.
  9. Oregon study revealed Medicaid enrollees hardly better off than uninsured: Medicaid expansion is not working in Oregon. In Oregon, a study was conducted among Medicaid enrollees that found Medicaid “generated no significant improvements in measured physical health outcomes.”
  10. Medicaid Expansion will do nothing to lower cost of overall healthcare delivery: Medicaid expansion would not lead to any type of price transparency in healthcare delivery, which does nothing to help lower the cost of healthcare delivery.
  11. Medicaid expansion does not lead to better health outcomes for the poor: Research consistently shows Medicaid patients frequently receive inferior medical treatment, are assigned to less-skilled surgeons, receive poorer postoperative instructions, and often suffer worse outcomes for identical procedures than similar patients both with and without health insurance.
  12. New Hampshire feels the financial burn and is reconsidering Medicaid expansion: Medicaid expansion is not working in New Hampshire. According to the National Association of State Budget Officers’ annual report, in New Hampshire Medicaid grew from 24 percent of the overall state budget in 2012 to 27 percent in 2014. In January 2015, the state’s Department of Health and Human Services announced that it was $82 million over budget, thanks to Obamacare, Medicaid expansion and to the original Medicaid program expanding with additional enrollees. Lawmakers are now deciding whether to continue the expanded Medicaid program which sunsets in 2016.
  13. The federal government’s promises aren’t reliable: The U.S. Supreme Court told the federal government mandating Medicaid expansion was unconstitutional. However, they admitted this year that if Florida didn’t expand Medicaid under Obamacare, they would not be incentivized to continue the Low Income Pool funding. If they would pull funding from some of the most vulnerable in the system, what wouldn’t they do?
  14. Florida taxpayers will foot the bill for billions: Florida taxpayers will be responsible for a tab of billions of dollars as the federal government requires increasing shares from Florida’s budget after a certain point if the state expands Medicaid under Obamacare. Even if the federal government keeps its “promise” on the funding percentage, Florida taxpayers will be responsible for 10 percent of the total cost of expansion, a tab that will run into the billions based on even the most conservative estimates.
  15. Having health insurance isn’t the same as receiving healthcare:Medicaid is socialized health insurance, not access to healthcare. There is no guarantee that just receiving socialized insurance means an individual receives quality service.
  16. The majority of the Medicaid expansion population consists of working-age adults: The overwhelming majority of the Medicaid expansion pool are made up of childless, able-bodied, working-age adults. Expanding a failing entitlement program for this population will only lock people into the cycle of dependence.
  17. Medicaid expansion creates a perverse disincentive to improving one’s financial status: In many cases, making just a few more dollars per year will actually cost a person thousands in copayments, deductibles, and out-of-pocket expenses resulting in being pushed out of Medicaid rolls.
  18. Illinois faced unanticipated cost increases in the billions:Medicaid expansion isn’t working in Illinois. Forbes’s Akash Chougule reports, “Health officials originally estimated it would cost $573 million from 2017 through 2020 when the state’s funding obligation kicked in. But nearly 200,000 more people enrolled in the program in 2014 than originally projected. State budget officials were forced to revise their cost estimates to $2 billion—more than triple initial estimates.”
  19. Medicaid will cost Florida way more than anticipated: The cost projections for a Medicaid expansion in Florida are unreliable and grossly underestimated. Several states are experiencing the financial strain of Medicaid enrollment figures well higher than initial projections.
  20. Medicaid expansion wouldn’t necessarily result in more coverage or access to care: Florida’s own Medicaid director stated that he couldn’t guarantee the expansion would result in more coverage or access to care.
  21. Medicaid expansion increases private insurance rates: Expanding Medicaid rolls will inevitably distort the risk pool causing private insurance premiums to rise, effectively shifting more of the cost of expansion onto taxpayers and those not receiving Medicaid benefits.
  22. Ohio taxpayers face a $400 million bill: Medicaid expansion isn’t working in Ohio. Ohio’s Medicaid expansion is expected to be nearly $1 billion over budget in June. With Ohio on the hook for 10 percent of the expansion’s cost by 2020 (if the federal government keeps its promise) that will result in an annual cost of over $400 million for Ohio taxpayers.
  23. Expanding Medicaid will likely increase fraud: Medicaid expansion will increase the amount of fraud and abuse within an already strained government program
  24. The systemic issues in the healthcare system will not go away:Expanding Medicaid does absolutely NOTHING to address systemic issues facing Florida’s healthcare system that impact everyone.
  25. Dependency cycle will expand beyond true safety net intent: 
    The idea behind the safety net programs has always been to serve individuals in need, while providing mechanisms to pull out of dependence into productivity, not to create generations of citizens who know nothing except government reliance. By expanding Medicaid to populations that are outside the typical safety net composition, we effectively enlarge and encourage the cycle of dependency to grow and become more ingrained in our culture.