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Tag: Mandate

Shared Responsibility in the Affordable Care Act

Craig GarthwaiteRecently we wrote that it was well past time to end the employer mandate in the Affordable Care Act.  In light of some commentary, we thought it best to revisit this issue in more detail.  It seems that most of the support for the employer mandate comes from a misguided understanding of why employers are currently the primary source of private health insurance.  It is explicitly not because of a sense of “responsibility” to the employee, at least not any more responsibility than they feel when they pay employee wages for their work.

Here is a basic summary of how labor markets work, based on decades of very widely accepted academic research and practical experience. Employees receive compensation from their employers in return for their work product.  In other words, employers aren’t running charities for their workers, but neither are workers volunteering their time at firms.  Each expects something from the other. Some employee compensation comes in the form of cash wages and some in the form of fringe benefits such as health insurance, pensions, free coffee, parking, etc.Continue reading…

SCOTUS Ruling An Unappreciated Win for the GOP

The ruling upholding most of Obamacare was an as-yet-unappreciated boon for the GOP. A brilliant move by Roberts, he managed to preserve the remaining integrity of the court — and raise his own stature — while at the same time increasing the odds of a Romney win. How?  By recasting the mandate as that third-rail of politics, a tax.  Let’s dissect both these statements.

First, how can we be sure it wasn’t a major victory for Obama, pundits notwithstanding?  There is a “market” in presidential election predictions, www.intrade.com.  One may place bets on candidates and while, like the stock market, it is wrong sometimes, the “price” of each candidate does react to events. So, for instance, Rick Perry’s price fell 75% within seconds of his forgetting the name of the third cabinet department he was going to eliminate.  And yet, a full day after Obama’s “victory” the “price” his re-election chances still has not budged. It bumped briefly and has since fallen back to the same $5.40 (to win $10 if he wins—a 54% probability) that it’s been hovering at for weeks.

Second, was Roberts accurate, or just politically astute, in re-casting the mandate as a tax?   Answer:  The latter.

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