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Health Care Farce Voted Up Last Night
By: Karl Denninger   Monday, November 09, 2009 12:20 AM

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Do we live in a Constitutional Republic any longer?

The 16th Amendment made lawful the income tax - that is, a direct tax on Americans.

But nowhere in The Constitution is the power found to force people, under penalty of law (including fines and imprisonment), to pay private parties for services they do not desire to purchase.

Yet that is in the bill passed last night.

Yes, we have Congressfolk - both men and women, and all Democrats (save one Republican) who voted for this.

This sure appears to be blatantly unconstitutional - and, I would argue, those who voted for the bill know it.

If you watched CSPAN yesterday you heard the speeches.  All those who rose in favor of the bill talked not about The Constitution and how this bill was a solution to the problems facing America's Health Care System - a system that consumes some 17% of our GDP - but rather it appealed to how individuals with specific circumstances would be helped.

But a desire to help someone is not the test for legislation.  All legislation by definition is designed to help someone.  The test is whether whatever is being proposed comports with the black-letter requires of The Constitution, and the even-blacker-letter requirements of the laws of mathematics. 

This bill meets neither essential test of all legislation; it instead proposes to destroy our Constitutional system of government.

Yet despite member after member rising last evening in opposition and stating that these mandates were unconstitutional not one rebuttal of that point was made by those in support.

The "Holy Grail" for the so-called "private" insurance businesses is forcing everyone onto one of their plans.  This is due to the problem of "adverse selection" - that is, you would not buy insurance until you got sick if it is quite (or very) expensive.  The more expensive the insurance gets the worse this problem becomes and the "insurance" ceases to be insurance at all.  Remember, "insurance" is a thing you buy to protect against an unlikely outcome - if you're already ill or believe you will become ill the outcome isn't unlikely - it is either probable or known.

Yet the desires and demands of private business do not give license to use The Constitution as toilet paper.

But the extra-constitutional game didn't stop there.  Oh no.  This 1990 page monstrosity goes much further.  It mandates that employers not only cover everyone they hire and pay at least a specific percentage of their premiums (or face a fine) it also mandates that said employer cover all members of that employee's family. While it is unlawful to discriminate against people based on their family status, what do you think is going to happen to salaries across the board to cover the risk of someone showing up for a job interview and having eight kids? 

Does Octomom become permanently unemployable - or does every employer in the nation reduce your salary offer now and forever to guard against the possibility of another Octomom showing up for a job interview?

You know the answer here - nobody is going to take the risk of a multi-million dollar discrimination lawsuit.  Your salary offer will be reduced, and if you are currently employed, you can forget about raises for a long time.

There are Constitutional solutions to this mess.  I have posted about them before. My chronicle of those posts in The Ticker is found here; it encompasses a reasonably small set.


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The above story is the opinion of the author only and it does not reflect iStockAnalyst opinion. Further, the author is not personally advising you regarding the suitability of the story for your investment needs. In no event iStockAnalyst will be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from or arising out of, or in connection with the use of this information. Please consult your investment advisor before making any investment decision.
  
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