• Obama Administration Is Illegally Diverting Billions to Insurance Companies


    A government watchdog has determined the Obama administration is violating its own health care law by illegally diverting up to $5 billion to private insurance companies participating in Obamacare.

    The U.S. Government Accountability Office is the nonpartisan federal watchdog that determines whether federal officials are spending taxpayer dollars in accordance with the law. In a legal opinion issued last week, the GAO accused the Obama administration of illegally diverting billions of taxpayer dollars to private insurance companies. READ MORE...

  • To End North Korea's Nuclear Push, We Must First Understand Its Fears


    North Korea’s Kim Jong-un continues his confrontational course. After Pyongyang conducted its fifth nuclear test last month, US defence secretary Ashton Carter declared it to be a “direct challenge to the entire international community”.

    But this is complete hooey, to use a technical term. It’s about time for the “international community” to stop acting as if there really is an international community. Even more, it’s fair to assume that Kim isn’t much concerned about what the “international community” thinks, let alone intends to “challenge” it. READ MORE...

  • How Meddling with Monetary Policy Shaped Modern Mortgages


    The mortgage market has seen a tremendous amount of change over the last four decades. The vast majority of this change can be attributed to the Great Inflation of the 1970s, which permanently changed the nature of our mortgage finance system. If we wanted a face for the Great Inflation, Arthur Burns, who served as Chairman of Federal Reserve from 1970 to 1978, would be the most appropriate.

    In 1976, over half of mortgages were originated by savings and loans, with commercial banks, mutual banks and mortgage companies taking up most of the remaining origination. This was largely an era of originate-to-hold. Securitization was largely unheard of, while the activities of Fannie Mae and even Ginnie Mae were rounding errors. Even the Federal Housing Administration was a relatively small part of the market. READ MORE...

  • Fiscal Grades for the Governors


    State governments got squeezed during the last recession as tax revenues fell. But since then budgets have rebounded, and general-fund revenues are up 33 percent since 2010. What are the states doing with the inflows of cash?

    The Cato Institute’s new “fiscal policy report card” finds out by looking at the tax and spending policies of each state governor. It assigns grades of “A” to “F” based on how frugal or spendthrift each leader has been. The best governors have restrained spending and pursued tax cuts, while the worst have grown their budgets rapidly and pushed tax hikes. READ MORE...

  • Will 2016 Be the Year Classical Liberalism Died?


    Liberalism is in trouble.

    No, not the authoritarian, big-government, modern variety. That’s doing just fine, with the two leading presidential candidates more or less equally devoted to it. But the classical liberalism of free markets, equal treatment under law, and individual rights is taking a real beating.

    >One needn’t paper over past political disagreements to recognize that there is something qualitatively different about what seems to be happening today. We are not arguing about whether federal spending should rise or fall by some small percentage of GDP, whether taxes should go up or down, or how to regulate this or that. Sure, those issues come up, but at a more fundamental level, this election is about the relationship between the individual and the state, and neither of the major candidates is taking the side of the individual. READ MORE...

  • Is Modern Science Polluted?


    For years, scientists and non-scientists alike have complained that something is fundamentally wrong with the way we do this business. Something has corrupted the integrity of our science.

    This is a serious charge because it means that more and more government policy — from limiting carcinogens to regulations on carbon emissions — is based upon an increasingly polluted canon of knowledge. If that were somehow corrected for, we would live under a far less intrusive government.

    Last week, this view received strong support when two researchers, Paul Smaldino and Richard McElreath, published a bombshell article in a journal of Britain’s Royal Society called “The Natural Selection of Bad Science.” Put simply, it is a closely argued, mathematically rigorous demonstration that the way we now reward scientists is actually making science worse. READ MORE...

  • It's Time to Suspend America's Alliance with the Philippines


    The United States has an unfortunate history of acquiring ugly authoritarian allies even when America’s security interests do not justify making such moral compromises. Malou Innocent and I described many of those unfortunate relationships in our book Perilous Partners, noting that a majority of the security relationships did not involve situations in which America’s vital interests were imperiled.

    Washington faces another increasingly problematic relationship: its alliance with the Philippines. As I’ve noted previously on this site, Philippine president Rodrigo Duterte is the personification of a “loose-cannon” ally. Among other things, he referred to President Obama as “a son of a bitch,” and made it clear that he had no intention of necessarily following Washington’s lead on foreign policy. READ MORE...

  • Short-Term Government Built Short-Term Capitalism


    Hillary Clinton recently highlighted a major problem in the U.S. economy: The business community increasingly pursues short-term profits at the expense of the long-term investments that increase employment, wages and innovation. This weakens the economy and leaves the American people worse off.

    I applaud Clinton for identifying this issue — I witnessed it firsthand during my tenure as CEO of BB&T Bank. But if she’s serious about solving it, she needs to identify the real culprit: the federal government, especially the vast — and growing — regulatory state. READ MORE...

  • What If ISDS Lawsuits Were Used to Fight Climate Change?


    For many years, the battle lines over investor state dispute settlement (ISDS) have been clearly drawn. On one side, progressive groups such as environmental NGOs have criticized ISDS as a nefarious tool used by multinational corporations to undermine domestic regulation. On the other side, business groups have supported ISDS as a neutral mechanism for arbitrating disputes between foreign investors and governments. Since the earliest investment disputes were brought, these positions have not budged. READ MORE...

  • The Complicated Dynamics of Insurance Companies and Drug Prices


    What constitutes a “fair” price for a drug? Unsurprisingly, that depends on who’s asking the question, as well as who’s answering. To get a price that can actually be construed as fair, it is essential that these are not the same entity.

    Many insurance companies would prefer that the Institute for Clinical and Economic Review, or ICER, be tasked with determining fair prices. That makes perfect sense, given that they created ICER in the first place and continue to fund it. ICER received its initial seed money a decade ago from the Blue Cross Blue Shield Foundation, and much of its subsequent funding has come from the insurance industry. It has become a prominent force in the healthcare marketplace and payers use its key offering, the ICER Value Assessment Framework, to guide their decisions on which drugs and medical services to cover and how much to pay. READ MORE...