Bryan Caplan  

Exegesis, Public Choice, and the Senate Health Care Bill

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When I explain the antitrust laws to my Industrial Organization students, I begin with the Fable of the Martian.  Suppose you're driving 66 miles per hour in a 55 mph zone with a fresh-off-the-spaceship Martian passenger.  No one in sight is going less than 60 mph.  The Martian asks for an explanation.  "Why is everyone breaking the rule?  Doesn't anyone ever get in trouble?" 

If you're wise, your approximate answer will be, "People get in trouble all the time.  However, it has little to do with the posted speed limit.  The punishment primarily depends on how fast the other motorists are going, the ratio of motorists to police cars on the road, and dumb luck."  The moral of the Fable: It's a mistake to focus on the letter of the law; it's a lot more useful to ask how the laws work in practice.

The more I hear wonks explain the details of the Senate health care bill, the more I keep thinking about the Fable of the Martian.  Ezra Klein, for example, seems to know a lot more about pending legislation than I would ever bother to learn.  But if you take the Fable of the Martian seriously, his replies to critics seem beside the point.

Case in point: I assume that when Ezra assures us that "[T]he bill isn't funded primarily by taxes. It's funded primarily by changes to Medicare," he is accurately stating the letter of law.  But it is reasonable to believe that policy will work this way in practice?  Medicare and Medicaid cuts have already been repeatedly passed - and repeatedly postponed.   Why should we expect things to be any different this time around? 

Bottom line: Critics may misunderstand the letter of the Senate bill.  In fact, at 2000+ pages (and almost 400 pages of amendments), there probably isn't a person alive who knows what the whole thing says.  This doesn't mean that critics misunderstand the actual consequences of passing the bill.  Textual exegesis is no substitute for public choice.


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COMMENTS (7 to date)
E. Barandiaran writes:

Bryan, you're right. Thanks for taking time to explain to Martians and Dems the meaning of a critical mass and and its relation to law enforcement.

Curt Doolittle writes:

Barandiaran,

Democrats and socialists use textual exegesis to as a means of masking incrementalism. (and they accuse, wrongly, libertarians of concentrating wealth using the same process.)

So, Bryan isn't educating democrats and socialists, who fully understand what it is that they are doing. He's educating conservatives and libertarians who do not understand that we rely on a process of evolutionary debate within our system of government to accomplish what it cannot: guarantee that participants are using that system for the shared pursuit of truth, rather than using that system as a device to legitimize the use of state violence to accomplish their desired ends.

Textual exegesis is simply a form of deception under the guise of the legitimacy of a democratic process, whose only legitimacy relies upon debate as a means by which parties who wish participate in shared pursuit of truth.

Violence is the only guarantor of freedom. Markets accomplish everything else. Political institutions exist entirely to use the violence of the state to eliminate both freedom and markets.

Why? because property and markets exist no matter what we do, simply by virtue of a division of knowledge and labor, and people try to game the market, even if only by taking advantage of ignorance.

And conservatives and libertarians, if they believe in the efficacy or legitimacy of our political process, are being taken advantage of. Because Democratic Republicanism (representative government) is a class strategy. Once multiple classes have political power, it's simply a chimera of oppression.

Jim Glass writes:

I assume that when Ezra assures us that "[T]he bill isn't funded primarily by taxes. It's funded primarily by changes to Medicare," he is accurately stating the letter of law.

But it is reasonable to believe that policy will work this way in practice?

The Senate just dropped the 5% tax on elective cosmetic surgery because it couldn't stand up to the elective cosmetic surgery lobby.

And it is still telling us that fully 40% of the cost of reform is going to be paid for by cuts to Medicare.

We all believe that, right?

R. Richard Schweitzer writes:

How can it be said that these Bills (they now ARE Bills) will not be paid for at least equally by taxes.

Example: That assertion totally disregards how the several states must fund the increases in Medicaid coverages (persons & benefits).

One might hope more states will do what TN has done and set a "cut-off date" (which has now passed)for Medicaid enrollments . That will be the first step in "rationing," some just won't get a "ration card." But, they will still get "HealthCare," just as has been the past practice, and those costs will continue to be spread through the same mechanisms as before - probably less efficiently with higher transaction costs.

The thrust of all this legislation is to provide the core of the "political class" with a rent-seeking significance through creating additional lines of control over the distribution of costs and benefits of an essential set of services. It is much the same as adding 40-odd additional layers of "middlemen" into transactions that need a reduction in those already existing layers.

However, it will be fascinating to see the Constitution-based challenges to specific elements which are crucial to these propositions for redistribution via federal "laws" other than simply through the coercion of taxes.

Right now, this thing is just two piles of stacked bricks. Under Constitutional challenges, there will not be enough mortar to make those two into a single structure that will stand on its own. Further revisions are to come to achieve the real "Public Choice" objectives of the legislators.

R Richard Schweitzer writes:

OH -

The "Public Choice" mentioned is as in Public Choice Theory as presented by Gordon Tullock and James Buchanan.

Jim Glass writes:

I assume that when Ezra assures us that "[T]he bill isn't funded primarily by taxes. It's funded primarily by changes to Medicare," he is accurately stating the letter of law.

But it is reasonable to believe that policy will work this way in practice?

The Senate just dropped the 5% tax on elective cosmetic surgery because it couldn't stand up to the elective cosmetic surgery lobby.

And it is still telling us that fully 40% of the cost of reform is going to be paid for by cuts to Medicare.

We all believe that, right?

David C writes:

"Ezra Klein, for example, seems to know a lot more about pending legislation than I would ever bother to learn. But if you take the Fable of the Martian seriously, his replies to critics seem beside the point."

Are you saying if the speed limit was changed to 70 mph, this would have no effect on the way people drive? Similarly, if the speed limit was lowered to 40 mph, would this not have the opposite effect?

The difference between the letter of the law and the way laws work in practice can be important in certain scenarios. But how can anybody know how a law will work in practice if they don't know what the law is?

Ezra Klein's response to critics who don't understand the letter of the law is perfectly reasonable. If critics think practice of the law will defer from the letter of the law, then they need to explain why.

Ezra's arguments cannot simply be brushed off because of a belief that nobody will pay attention to that particular rule. That's impossible to know if you don't understand the rule in the first place and in particular its method of enforcement.

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