Obamacare, Federalism, Big Government and Liberty

Recently, I have been considering a post about the encroachment of government into the lives of individuals.  While I live in Canada and clearly have a better handle on issues here than I do elsewhere, I have found myself fascinated by events in Europe and America (partly because Canada’s problems aren’t as immediately pressing).

Today, the SCOTUS decided that the individual mandate portion of the Obamacare program is constitutional.  I read through the decision, including the arguments of Roberts and Ginsberg in support and the dissent by Scalia, Kennedy, Thomas and Alito.  I will say that I found the decision as written by Roberts to be well written and well argued.  The supporting argument by Ginsberg seemed unnecessary.  The dissent was too partisan, in my opinion, and failed to make as good a legal argument.  However, I think the problem is not that the SCOTUS misread the precedents or the statutes.  I honestly don’t think SCOTUS made a bad decision – the problem isn’t a simple legal question.  The ability of the state to use taxation to influence social behaviour is well accepted, particularly since the 1940s.  My problem is that while the US government will impose a tax on those who don’t buy health insurance, I don’t see how this money flows to the insurance industry to help hold down rates.  It seems like just a revenue grab for the federal government, and insurance rates will not fall for the reasons given by the Chief Justice.

There are a number of problems in the US health insurance system – problems largely created by government.  Many of the states have imposed regulations on health insurance plans, forcing insurance companies to bundle coverage and forcing consumers to pay for bundles that contain coverage they may not want or need.  This drives up insurance costs, perhaps as much as does the failure of some to procure insurance and the need for health care providers to recover costs of treating the uninsured against those who do have insurance.  The other problem is that Medicare and Medicaid provide rich coverage at taxpayer expense, and when you have that many people covered by the state there is little incentive to hold down costs because the consumer doesn’t see the cost and doesn’t have to make economic decisions on health care.  If the states did not force bundled coverage, health care costs would be lower and more people would purchase health insurance.  For instance – catastrophic health insurance should be available that doesn’t cover mundane care such as check ups or minor procedures.

The Chief Justice writes that the power of the federal government has expanded in the 220 years since the US constitution was drafted, particularly through it’s power to regulate commerce and raise taxes.  This should not be an excuse to allowing further growth in the power of the government.  I think he should have relied more fundamentally on the idea that “any powers not explicitly given to the federal government are left to the States and the People”.

The growth of national/federal governments has reduced the Liberty of the citizens, regardless of whether we are talking about the USA, Europe or Canada.  Federal governments have used their substatial taxation powers to bribe the states/provinces and the people into giving up freedom in return for being “taken care of”.

However, this leads to to ever growing government that is less and less responsive to the people.  Europe is going bankrupt because the people don’t understand that the state doesn’t have unlimited funds to pay for lavish pensions, health care, education and welfare programs.  America is heading down a similar road, with Canada not far behind.

Alexis de Toqueville wrote in the early 19th century that the strength of America came from it’s focus on local government.  The federal and state governments, at that time, had limited powers, limited revenues and limited involvement in the regulations that governed business or day to day life.  This is no longer the case, and is not the case in Canada or in Europe.  As government has raised more money and expanded it’s programs, we have lost much of the liberty our forefathers in America and Canada believed so strongly in.   Europe is in even more dire straights, because the populous and leaders of many EU states still fail to understand you can’t live on borrowed money forever.   Proposals to expand the federal powers of the EU, to include fiscal oversight will accelerate the downfall of Europe as a civilized society.