The Freedom Bulletin

Good news for anyone who is opposed to the individual mandate requiring all Americans to purchase health insurance. Virginia’s lawsuit against the mandate has taken a step forward, as a judge gave it the okay to proceed today. From Fox News:

“U.S. District Court Judge Henry Hudson said he is allowing the suit against the U.S. government to proceed, saying no court has ever ruled on whether it’s constitutional to require Americans to purchase a product.

‘While this case raises a host of complex constitutional issues, all seem to distill to the single question of whether or not Congress has the power to regulate — and tax — a citizen’s decision not to participate in interstate commerce,’ Hudson wrote in a 32-page decision.”

I sure hope the lawsuit succeeds. If judges still care about the Constitution, it will. Although the Commerce Clause gives the federal government the power to regulate interstate commerce, it does not allow the government to force people to engage in commerce.

On Tuesday, Missourians will vote on a ballot measure to outlaw the individual mandate, the part of health insurance reform that requires all Americans, except those who are unable to afford it, to have health insurance. From Missourians for Health Care Freedom, the organization that supports the initiative…

“Patients should have the right to pay directly for medical services with their own money. That’s because when consumers control the dollars, the patient makes the medical treatment decisions… Preserving the rights of patients to pay directly for medical care ensures that patients – not government bureaucrats – decide which doctor to see or what medical treatment to choose.”

Support Proposition C!

I was reading a post at the CNN Political Ticker about an NAACP resolution to condemn the “racism” of the Tea Party movement. The post quoted Mark Williams, a spokesman for the Tea Party Express, who made a really good point:

“It’s the Obama administration that rolled back civil rights to a pre-civil rights era with ‘Obamacare’ in which they removed the concept of individual rights…it’s the Obama administration that put a tax on white people with a tanning salon tax.”

I never thought of that before, but it makes sense.

Suppose that there was a product that was used almost exclusively by black or Hispanic people. Then suppose that the government decided to tax it. Wouldn’t the NAACP and lots of other people and organizations call this racist?

Tanning salons are used predominantly by white people, and the Democrats’ version of health reform puts a tax on them. Why is no one calling this racist?

Is it just me, or is there a double standard here?

President Obama recently gave a speech praising the recently passed version of health insurance reform and warning insurance companies not to use the new law as an excuse to raise prices. But unless strong measures are taken to prevent this, “Obamacare” will actually cause the price of health insurance to rise.

I oppose Obamacare, primarily because it requires all Americans to have health insurance. In my opinion, this violates everyone’s rights because people have the right to decide how they want to spend their own money, as long as they don’t do anything that violates the rights of anyone else. But according to economic theory, the individual mandate has a bad side effect as well – it makes the cost of health insurance go up.

If you haven’t studied economics before, here are the basics:

Usually, the higher the price of a good, the less the demand. Makes sense, right? Also, the higher the price of a good, the higher the supply, because producers are more willing to make a product if they can sell it for a high price. The supply and demand curves (or lines) can be shown on a graph. The point where the two lines intersect is called the equilibrium. This represents the quantity and price that will be produced in a free market.

However, by requiring everyone to purchase a product (in this case health insurance), the government stops demand from responding naturally to price. The degree to which demand for a good responds to price is called price elasticity of demand. People will buy necessities such as food, water, or insulin for diabetics regardless of their price. In economics-speak, the demand for these goods is inelastic. The demand for things such as lattes, CDs, and stuffed animals is elastic, because people can live without them and therefore tend to buy less of them if the price goes up. When demand is perfectly inelastic, the demand curve looks like a vertical line.

By forcing everyone to buy health insurance, the government makes the demand artificially inelastic. The problem with this is that when demand is perfectly inelastic, price basically approaches infinity. If consumers are going to buy something no matter what it costs, you can bet that producers are going to charge a lot.

Bottom line: according to traditional economics, the individual mandate will make the cost of health insurance go up.