How to sabotage a recovery: Raise taxes

Even before Covid-19, many Californians were struggling with the high cost of living here. The long-time willingness of many Californians to pay the “sunshine tax” premium for living in a state with great weather, universities, entrepreneurial culture, and lifestyle has eroded in the face of high costs of daily life.   

Things have gone from bad to worse during the pandemic crisis. The Sacramento response to the economic and jobs calamity has been not to cut costs, but instead propose more taxes – higher property taxes on commercial, industrial and agriculture property; a new sales tax on services; a new tax on jobs; and most recently another hike in income taxes for families and small businesses that make more than $1 million a year.

These tax proposals each present a host of policy problems, but more broadly they reveal a massive gap between the lawmakers making decisions in Sacramento and the views and needs of average Californians trying to get ahead and take care of their families.     

Sacramento politicians hear “tax” and envision billions of dollars in additional revenue to fix all those basic problems they haven’t solved to date – worsening schools, deteriorating infrastructure, homelessness, economic disparities – despite having spent a trillion dollars in the last five years to address these problems.  

California voters hear “tax” and think about the dollars coming out of their pockets, and wonder if they’ll ever see much benefit from government spending their money.

But beyond the politics, these measures have profound policy problems.

  • Hiking taxes on the wealthy will send a message to the very people who together provide 40% of personal income tax revenue: is it worth it to you to keep California as your home and business location?  One take-away from the recent catastrophe is that skilled individuals can work at or start a business from almost anywhere. And even higher income taxes will exacerbate the state’s budget volatility.
  • Creating a new tax on services will drive up the costs of nearly every good and service in the state, hamper our efforts to build affordable housing and infrastructure, and punish small businesses.
  • Prop 15 claims to target just big commercial and industrial owners, but it also taxes farmers and ranchers, driving up food costs, hikes costs on small businesses who lease their space, and eventually winds up being paid by consumers. 
  • tax on jobs created by large employers will have the predictable effect: fewer jobs created by these employers – at least in California.

A recent poll of California voters by EMC Research for the California Tax & Budget Research Project revealed some trends long felt by California voters and long understood by those who actually listen to them: 

  • 66% of likely voters at the November election said they agree that California taxes are out of control and they would oppose any tax increase.
  • 77% of these voters said they agree taxes on corporations and businesses just get passed on to consumers in the form of higher costs.

Covid-19 and the resulting impacts on the state budget don’t change this foundational reluctance toward taxes. 

When asked about the $54 billion budget deficit due to the pandemic, by a two-to-one margin voters said California is too expensive and highly taxed already, and would oppose any tax increases because they would make a bad economy worse and raise costs for consumers. They soundly rejected the position that the state needs to consider increasing taxes to fund schools, health care and COVID-related services.

Put simply, voters have had enough. They’re wise to the shell game pretending taxes on someone else won’t get passed on to all residents.

Nobody in California is immune to the havoc wreaked by the Covid-19 pandemic – a health crisis compounded by an economic collapse which is eroding our social cohesion. We’ve seen how an economic recovery can be thwarted by new virus outbreaks. Our elected leaders should similarly resist public policies that would prevent a healthy restoration of jobs and the economy.  

Loren Kaye is president of the California Foundation for Commerce and Education

This article was originally published by Fox and Hounds Daily.

Judge orders changes to voter guide for property tax measure

A California judge has ordered changes to an election guide mailed to every registered California voter this fall, ruling Wednesday that some arguments opposing a hotly contested property tax initiative are “false or misleading.”

Proposition 15 will ask voters to raise taxes on business properties with a value of $3 million or more. Supporters say the change will generate an additional $12 billion for struggling local government and public school budgets that depend on property taxes for most of their revenue. But opponents say the measure will hurt businesses during a pandemic-induced economic recession that has already cost millions of people their jobs.

The measure would repeal portions of Proposition 13, the landmark 1978 ballot initiative that changed how California assesses property taxes. The law set property taxes for homes, businesses and farmland at 1% of the sales price and limited tax increases at 2% per year. Proposition 15 would let local governments assess the taxable value of some business properties based on their market value at least once every three years. …

Click here to read the full article from the Associated Press.

California bill would make employers report Covid-19 exposures

A California bill supported by labor unions and opposed by business groups would force employers to quickly notify employees and health officials if a worker is exposed to coronavirus.

Under Assembly Bill 685, sponsored by The California Labor Federation and United Food and Commercial Workers, public or private employers would face fines up to $10,000 for failing to providenotifications of exposure within 24 hours. Failure to provide any of the notifications would be a misdemeanor, under the bill authored by Eloise Gómez Reyes (D-San Bernardino) and promoted by Robert Rivas (D-Hollister) and Lorena Gonzalez (D-San Diego).

“As the average age of those falling ill from COVID-19 has become younger, it is critical to track workplace exposure and to use that data to find ways to keep workers safe on the job,” the bill says. “With infections and deaths disproportionately high in the Latino, Black, and Asian-Pacific Islander communities, more information about workplace illness and industry clusters can inform policy makers in addressing healthcare disparities and protecting vulnerable workers.”

Existing law fails to make employers’ reporting requirements clear, the bill says. …

Click here to read the full article from the San Jose Mercury News

Kamala Harris ‘Very Much in Contention’ To Be Biden’s Running Mate

Joe Biden said Sen. Kamala Harris is “very much in contention” to be his running mate on the 2020 Democratic ticket, clarifying that he doesn’t hold a grudge against the California lawmaker for attacking him in an early primary debate.

The presumptive Democratic nominee’s conciliatory tone toward Harris comes after senior members of Biden’s vetting team had thrown cold water on her vice presidential bid in the final stretch of Biden’s search.

In late July, POLITICO reported that former Sen. Chris Dodd, who is part of Biden’s vice presidential search committee, told a longtime Biden supporter that Harris had “no remorse” when asked about her confrontation with Biden at the first Democratic primary debate.

CBS News correspondent Errol Barnett asked Biden about those reports during an interview that aired Thursday morning as part of the virtual convention of the National Association of Black Journalists and the National Association of Hispanic Journalists.

“No, he didn’t say that to the press, he was talking to somebody offline, and it was repeated,” Biden said, referring to Dodd’s comments. “Now, I don’t hold grudges. I’ve made it really clear that I don’t hold grudges. I think it was a debate, it was as simple as that. And she’s very much in contention.”

Harris sharply criticized Biden at a June 2019 Democratic presidential debate over his previous stance on federally mandated busing to integrate public schools, raising her personal experience as one of the first children to integrate her own school in California. The then-presidential contender also ripped Biden’s warm recollection of segregationist senators as well as the former vice president’s record on race.

The exchange, punctuated by Biden cutting his response short and saying, “Anyway, my time is up,” led to a short-lived boost in the polls for Harris and created one of the primary cycle’s early defining moments But the momentum for Harris did not last and Biden maintained his status as the Democratic frontrunner.

The debate attack has nonetheless irked Biden allies, who were surprised that Harris would go after the former vice president given her close relationship with Biden’s late son, Beau.

While Harris rose to the top tier of Biden’s running mate shortlist, POLITICO reported members of Biden’s search committee expressed trust issues with the California senator. But after the POLITICO report of Dodd’s comments, Harris allies met with the Biden campaign to advocate for her as a potential running mate. …

Click here to read the full article from Politico

The Financial Power of California’s Government Unions

There is no special interest in California that wields more influence over state and local politics than public sector unions. At every level of government, from the office of the governor to a school board managing a district with only a few hundred students, public sector unions are omnipresent. With rare exceptions, to defy their agenda is certain political suicide.

The reason for this power is money. Lots of money. Every two-year election cycle, not millions, but hundreds of millions of dollars are spent by California’s public sector unions to support or oppose candidates, campaign for ballot measures, lobby the legislature, and pay for public relations campaigns. While wealthy individuals or powerful corporations may at times challenge these unions, their concerns are narrow in focus. Nothing matches the perennial torrent of public sector union money; the opposition may stir up a flash flood, but these unions are the Amazon.

Twice in the past five years the California Policy Center has attempted to estimate just how much money public sector unions collect and spend each year. In 2015, a rough top-down estimate that used US Census Bureau data on union membership and general assumptions on the average union dues payment came up with $1.0 billion per year. In 2018, exercising an abundance of caution, referring to the 990 forms that unions file with the IRS, as well as researching membership information that is often provided by the unions on their websites, the total public sector union spending estimate was $800 million per year.

This time, using the same methods as 2018, but going into somewhat more detail, the new estimate is $921 million. It should be noted that available information online is usually about 18-24 months behind. For example, our 2018 report referenced Form 990s that were filed for 2015. This 2020 report used Form 990 data for the year 2018, the most recent currently available.

The fact that data presented here represents 2018 numbers raises an important question: Has the Janus decision, which found that the application of public sector union fees to non-members is a violation of the First Amendment, had any effect on public sector union revenue and membership? Because Janus took effect in mid-2018, the results shown here may only serve as a baseline. Form 990s for 2019 will not be available to the public for another year.

Moreover, unless the trends in total revenue estimates show truly dramatic changes, which is unlikely, there are too many variables at work to know what may be generating the variance. If the numbers are up, would they have been up higher without the Janus decision? Will any downward results in 2019 merely be the impact of unions losing non-members who still had to pay agency fees, or would some of the downturn be the result of losing members? How will the bureaucratic obstacles put up by the unions delay individuals from exercising their new rights under Janus? And how would one account for new bargaining units, such as the 45,000 child care providers who in July 2020 voted to become new AFSCME members?

Much of this discussion, however vital, falls outside the scope of this analysis. Here then is an assessment of just how much public sector unions collected in 2018.


The biggest public sector union in California, by far, is the California Teachers Association. From their website’s “About Us” page, the CTA’s declared membership is 310,000, down from the “Fact Sheet” they’d posted two years ago (since removed) which declared a membership of 325,000. On the surface, this may suggest the CTA has lost members, but in reality what was the CTA’s loss was another union’s gain.

As reported by EdSource in August 2019, the faculty associations representing 19,000 staff working in the Cal State University System voted to “disaffiliate” from the CTA. The CTA, for its part, claims new recruits have made up for this. Whatever the net effect will be, during 2018 these Cal State workers were still part of the CTA, so 325,000 remains a valid membership estimate for that year.

Using an average annual dues estimate of $1,040 per member, which is based on an analysis published in June 2018 in LA School Report, the CTA and all of its local affiliates had an estimated total dues revenue in 2018 of $338 million. The CTA also had “other income” in 2018 of $18 million, which brings their total revenue estimate up to $356 million.

A distant second to the CTA, but still one of the biggest public sector unions in California, is the California Federation of Teachers. Like the CTA, the CFT is comprised of separate local and regional affiliates, making the challenge of estimating their consolidated revenue best approached by multiplying their average dues by their stated membership. According to their “About Us” page, their membership is 120,000, and their average member dues, reputedly somewhat lower than the CTA at $900 per year, puts their total revenue at $108 million.

The California School Employees Association, which according to their “About Us” page has a massive membership of 250,000 school support staff, reported on their 2018 Form 990 total revenue of $81 million. This implies an average annual dues of only $327 per member, which seems low. Without reviewing the 990s for all of the CSEA affiliates, and accounting for the net effect of all internal transfers of funds, it is impossible to discern a more accurate number for CSEA. It may be that the number of CSEA members is a relatively low percentage of the number of people represented in their bargaining units.


The decentralized nature of most of the major public sector unions in California makes any reasonably accurate but rough estimate dependent on two variables – total membership and average dues per member. To arrive at the number of members of police unions in California, we relied on an October 2018 Public Policy Institute of California study “Law Enforcement Staffing in California.” Quoting from the study:

“In 2017 there were more than 119,500 full-time law enforcement employees in California; roughly 78,500 were sworn law enforcement officers (with full arrest powers) and 41,000 were civilian staff.” We are assuming that 100 percent of the sworn law enforcement officers are unionized. If this is incorrect we would appreciate the opportunity to know the accurate percentage.

To arrive at the average union dues paid by California’s police officers, we reviewed the Form 990s for the unions representing sworn police officers in California’s ten largest cities. On these forms the “revenue from dues” is a separate line item. We then collected, for each city, the number of police officers on the force. In most cases, this information was available from the city websites, in a few cases, we had to rely on news reports, and in two cases, we called the police dept. in those cities and asked them. Using this method, the weighted average annual union dues we calculated was $1,340.

The product of average police union dues of $1,340 and 78,500 sworn law enforcement officers yields an estimated total revenue for all police unions in California of $105 million per year.

A similar method was used to estimate the total dues collected by California’s many firefighter unions, mostly local affiliates of California Professional Firefighters. On its “About CPF” page, the California Professional Firefighters claim membership of 30,000. Applying the same average annual dues assumption we used with members of police unions, $1,340 per year, we estimate the total dues collected by firefighter unions from their members at $40 million per year.

California’s prison guards are represented by the California Correctional Peace Officers Association (CCPOA), a centralized union which reported on its Form 990 total revenue in 2018 of $30 million. This is consistent with a membership of around 31,000, implying average dues of $983 per year.


Two very large public sector unions that belong in any analysis of public sector union revenue in California are the California affiliates of the American Federation of State, County, and Municipal Employees (AFSCME), and the California State Employees Association which includes the massive SEIU Local 1000.

AFSCME California includes a diverse group of “Councils” that represent an impressive variety of professions. This can be quickly appreciated by reviewing their “Who is AFSCME California” webpage. From the information on these pages, along with phone calls to some of the actual Local offices, the total number of AFSCME members in California is estimated at 220,000 people. If anything, this estimate is low, insofar as some large agencies were unable to provide membership numbers.

Because the AFSCME dues assessment varies roughly between 1.25 and 1.5 percent, because a high percentage of AFSCME’s job descriptions involve skilled professionals, and based on conversations with experts on public sector unions, we believe an average annual dues collections estimate of $600 per year is reasonable, since even at the lower withholding percentage this implies an average member income of $48,000 per year. Based on these assumptions, we estimate AFSCME California’s consolidated dues revenue at $132 million per year.

Last but not least is the California State Employee Association, which includes three major unions of active state and local government employees. The Cal State University Employees Union, which declared revenue of $7 million in 2018, the massive SEIU 1000, representing 96,000 employees with revenue of $56 million in 2018, and the smallest of the three, the Association of California State Supervisors, representing 6,500 members with an estimated 2018 revenue of $4 million.

When it comes to the possible impact of the Janus decision, the 2017 and 2018 Form 990s for SEIU 1000 offer intriguing data. In 2017, SEIU had service revenue considerably higher, at $67 million. Understanding the reason for this drop, and watching the revenue trends over the coming years for all of California’s public sector unions, should make for interesting future analysis.


As shown on the following summary chart, California’s public sector unions collect and spend well over $900 million per year, or $1.8 billion per two-year election cycle. While only about one-third of this money is spent on explicitly political purposes such as campaign contributions and lobbying, this is still a staggering amount of money. What other special interest in California is willing and able to spend $600 million every two years on political advocacy, year after year, for decades on end?

And where the spending is not declared as political, it may still have a political impact. As the plaintiffs argued in the Janus case before the U.S. Supreme Court, and in the deadlocked Friedrichs case before that, all public sector union spending is inherently political. Public education campaigns, for example, are not considered “political,” but unions rarely embark on these efforts, often at levels where they saturate California’s expensive media markets, without at least an indirectly political motivation. And what about negotiations for compensation and work rules? Aren’t these political decisions?

When considering the total spending estimate here, it is worth emphasizing that in most cases these estimates understate the ultimate total. In every case, the average dues we assumed for our calculations of total dues revenue were lower than what virtually all anecdotal evidence suggests. And in only one case, the state branch of the CTA, did we include “other income” apart from dues revenue. How many of these unions and their many affiliates, most of them flush with cash and other invested assets, had additional revenue beyond just what they collected from their members?

Moreover, what about the many unions we didn’t identify here, but which are active in California and, cumulatively, add significant numbers to the estimates of total members and dues collections? What about the Council of UC Faculty Associations, an amorphous group that represents potentially tens of thousands of professors, associate professors, post-docs, etc.? Under what umbrella do these bargaining units fall? Were they excluded from this analysis? Probably.

To get another glimpse of just how Sisyphean the task of identifying and tracking all of California’s public sector unions is, have a look at this website, put up by the Freedom Foundation. Scroll down this page and consider the following: Were all of these various Locals included in this analysis? Here’s your answer: No. They weren’t. There’s simply too many of them. Some years ago, a professor at Pepperdine University who was considered an expert on public sector unions in California was asked if there was an accurate compilation, anywhere, ever, showing how much, collectively, these unions rake in every year. His answer, emphatically to the negative, was too obscene to be repeated here.

If anyone wishes to undertake a comprehensive analysis of every single public sector union in California, every state headquarters, every regional council, every Local, they’re welcome to it. The reporting requirements are almost nil. Unlike private sector unions, which are somewhat more accountable due to having to file the more detailed Form LM-2 with the U.S. Dept. of Labor, the only public disclosure required of public sector unions is the Form 990, mostly used for tracking nonprofits. The diligent analyst, using Form 990s, will have fun attempting to net out the thousands of cases where funds are transferred between affiliates – dues trickling upwards to regional, state and national offices, as well as sometimes horizontally between Locals, and sometimes from the top down. Have at it.

California’s public sector unions are not only the most powerful political special interest in the state, but most of them are nakedly partisan. To have all this power, and merely use it to push for more staff, more restrictive work rules (which equates to more staff), more pay, and more benefits, that would be bad enough. Not because workers shouldn’t want to optimize their opportunities to work and live with security and dignity, but because public sector unions simply do not have to deal with the natural checks on their demands that create more balance between management and private sector unions. But with only a few exceptions – primarily among the law enforcement unions – the websites of these public sector unions read like a pamphlet describing the agenda of the Democratic party. Is this appropriate? Does this represent the membership? And even if so, shouldn’t public sector unions, with all the power they wield, be politically neutral?

A long overdue reckoning with public sector unions faces California’s electorate. It might start with the public schools, which labor under a public sector union monopoly that has nearly destroyed accountability. The CTA, for example, has endorsed the absurd goal to “defund the police.” Perhaps defunding the CTA itself might be a more appropriate way to rescue California’s disadvantaged.

But between the political reality of public sector union power, and the necessary reforms that Californians desperately deserve, are nearly one billion dollars per year of cold hard cash.

Edward Ring is a contributing editor and senior fellow with the California Policy Center, which he co-founded in 2013 and served as its first president. The California Policy Center is an educational non-profit focused on public policies that aim to improve California’s democracy and economy. He is also a senior fellow of the Center for American Greatness.

This article was originally published by the California Globe.

California may crack down on bad cops in wake of George Floyd’s killing

Just as the California Legislature was adjusting to the new reality of a session reshaped by the coronavirus pandemic, the killing of George Floyd on Memorial Day upended it again.

Video of white Minneapolis police Officer Derek Chauvin kneeling for nearly nine minutes on Floyd’s neck, killing the unarmed Black man, sparked a national upheaval that has thrust issues of police brutality and misconduct back into the spotlight at the state Capitol.

Dozens of bills before lawmakers could transform policing in California — opening up more personnel records, holding officers liable for not intervening when their colleagues use excessive force, and creating a process to strip police of their badges statewide when they break the law. …

Click here to read the full article from the San Francisco Chronicle.

Mandated Diversity: California Bill Would Ban All-White Corporate Boards

Photo by Benjamin Child on Unsplash

All-white corporate boards would be prohibited in California under a bill in the Legislature that follows in the footsteps of a controversial law that mandated women in corporate boardrooms.

More than 600 publicly held companies with California headquarters would be required to have at least one person of color serving on their corporate boards by the end of 2021 under the legislation introduced by Assembly members Chris Holden, a Pasadena Democrat, and Cristina Garcia, a Bell Gardens Democrat. 

Holden said many corporations need to be prodded into racially diversifying their boards. 

“This is the time to do something bold,” he said. People of color “need to have the same access as those who have benefitted for so long, and the time is now.”  

Nationally, 19.5% of board members of Fortune 100 companies are people of color, according to a 2018 report by the Alliance for Diversity.

In California, many large corporations — including Disney, Apple, Intel, Tesla, Oracle, Chevron, Facebook, Wells Fargo, Cisco Systems and Alphabet Inc., the parent company of Google — already have at least one person of color on their boards. But some, like Monster Beverage Corporation and Chegg, Inc., have all-white board members.

The law, if enacted, would be the first in the nation to mandate the racial makeup of corporate boards. Last year, Illinois considered a bill that would have required companies based there to have a woman, Latino and a Black person on their boards, but instead only required them to report the gender, race and ethnicity of the members.

California’s bill, AB 979, faces its next hurdle on Aug. 13 in the Senate Banking and Financial Institutions committee. The Legislature has until Aug. 31 to pass bills unless Gov. Gavin Newsom calls lawmakers back for a special session

The California Chamber of Commerce and the California Manufacturers & Technology Association declined to comment on the bill. Both opposed California’s 2018 gender diversity bill, SB 826.

Opponents say the diversity bill will trigger legal challenges, just as the law mandating female corporate directors did. 

“The Legislature seems intent to make the same mistake again,” said Michael Bekesha, a senior attorney with Judicial Watch. 

Judicial Watch challenged the gender diversity law as unconstitutional on behalf of three California taxpayers. The California Secretary of State aimed to have the lawsuit thrown out but a court ruled in favor of Judicial Watch and the case will go to trial sometime next year, Bekesha said. 

When Gov. Jerry Brown signed the bill into law that required corporations to include women on boards, “he was aware that there would be concerns that the law was unconstitutional and I think you’ll see similar statements playing out as this new bill progresses,” Bekesha said. 

Some opponents say such laws are patronizing. 

Anastasia Boden, senior attorney at the Pacific Legal Foundation, which also challenged the gender diversity law in court, said that race and sex-based laws “very often can harm the very people they intend to help.”

“It relegates women to quota hires,” Boden said. “Women will now be seen as being hired simply because of the government mandate rather than because of their qualifications and achievements when they may have even been hired without the quota.” 

The diversity bill defines underrepresented communities as people who self-identify as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian or Alaska Native. 

The requirements would ramp up in 2022. For corporations with nine or more directors, at least three directors must be people of color by the end of 2022, and corporations with between five and eight directors must have at least two. Companies would be fined $100,000 if they don’t comply. 

Supporters say the new diversity bill is sorely needed because racism is widespread.

“What COVID has revealed is systemic racism and the impact on different ethnic groups or racial groups,” said Maeve Richard, a former assistant dean at Stanford’s Graduate School of Business. “And so the post COVID answer is we need to do something about it.” 

Richard said some companies rely heavily on their social network, which often leads to a predominantly white board of directors. Companies, she said, should use objective criteria to ensure their boards have qualified and diverse members, adding that government can play a role in creating a more equal system.   

Others emphasize how little has changed over the years. Maria Contreras-Sweet, administrator of the Small Business Administration from 2014 to 2017, served on the  U. S. Department of Labor’s Glass Ceiling Commission, which was formed in 1991. She said she sees some of the same problems still persisting now. While she sees progress, she recognizes how slow it’s been. 

“I definitely think that these times have brought a greater awareness and more conversations in boardrooms about maybe unconscious bias that may exist,” she said. “People are having hard conversations. It’s a journey, it’s not like you turn on a switch and all of a sudden people are enlightened.” 

The Latino Corporate Directors Association reported that 86% of California-based public companies have no Latinos on their boards even though Latinos represent 39% of the state. The organization has not taken a formal position on the bill.

“This moment feels a lot different from other moments, that’s why I’m going to say I’m hopeful,” said Linda Akutagawa, the CEO of LEAP, a nonprofit which aims to cultivate Asian and Pacific Islander leadership. “But despite the kind of change that we’re going through right now, I don’t think this is going to change as quickly as maybe advocates and activists want to see.”

McKinsey & Company researchers found that companies with ethnically diverse executive teams are 33% more likely to outperform companies with less diverse teams on profitability, according to 2017 data. 

Even though diversifying a company can improve the bottom line, Akutagawa explained why change has been slow:

“People with power do not give up power that easily,” she said. “And corporate boards have power.”

Elizabeth Castillo is a reporter for CalMatters.

This article was originally published by Fox and Hounds Daily.

Tesla could still leave California, Musk says

Despite winning a standoff with local health officials over reopening his factory, Tesla Chief Executive Elon Musk is sticking with his threat to move company headquarters to another state.

“There’s no question that our headquarters will remain in California for the short term,” he said in a recent interview with Automotive News. “Long term, we’ll have to wait and see.”

He didn’t specify what he meant by short term and long term, or what might eventually prompt such a move.

Musk’s take-his-ball-elsewhere warnings first came in a May 9 tweet, after Alameda County officials ordered him not to reopen Tesla’s Fremont assembly plant until COVID-19 closure restrictions were lifted. …

Click here to read the full article from the L.A. Times.

Democrats Use Coronavirus To Push ‘Medicare-For-All’

Stethoscope on a printed sheet of paper

More than 5 million Americans have lost their employer-sponsored health insurance due to coronavirus-related unemployment, according to a new study from FamiliesUSA. In response, Democrats are renewing their push for “Medicare-for-all”.

Just this week, 360 Democratic delegates promised to vote against any party platform that doesn’t endorse single-payer health care. In their formal petition, they cite insurance losses from the pandemic as a chief reason why they consider “Medicare-for-all” non-negotiable.

But this political ploy is based on bad information. While the pandemic has cost millions of workers their jobs, many of them still have access to affordable coverage. Citing the coronavirus-fueled economic crisis as a reason to scrap private insurance is deeply irresponsible — and would leave the vast majority of Americans worse off.

For starters, it’s far from clear that the turmoil in the labor market has led to droves of people ending up uninsured. According to an analysis by the Galen Institute, nearly 98 percent of Americans who had employer-based coverage before the pandemic have maintained employer coverage.

Further, more than half of workers who have been furloughed during the pandemic still have their employer-sponsored insurance, according to a recent survey from the Commonwealth Fund.

Those who lost employer-sponsored coverage because they lost their jobs have the option of staying on their health plan through a federal program known as COBRA. Such coverage can be pricey since patients must pick up the entire premium. But for Americans who enjoy their job-based coverage and can afford it, these high premiums can be worth the expense.

Those subsidies are often necessary to make exchange coverage affordable, as ObamaCare’s onerous insurance-market regulations have caused premiums to surge. As of 2017, average premiums for individual plans on the federally run exchange had more than doubled from where they were in 2013, before the marketplaces opened for business in January 2014.

Short-term, limited-duration health plans are another option for the uninsured. According to research from eHealth, an online insurance broker, average premiums for an individual short-term plan are $113 a month — about one-fourth those for a traditional plan.

A study from the Manhattan Institute found that premiums for short-term plans were lower than — and in some cases, almost half the cost of — premiums on the exchange for similar levels of coverage.

Short-term plans are cheaper because they’re exempt from many of ObamaCare’s cost-inflating mandates. They’re expressly designed to fill gaps in coverage for people who are between jobs.

In 2018, the Trump administration boosted the utility of short-term plans by extending their maximum duration from three months, as it was under President Obama, to 364 days. The administration’s rule has been challenged twice — and upheld by the courts twice, most recently in a 2-1 ruling in July by a panel of the U.S. District Court of Appeals for the District of Columbia.

Unfortunately, some states — including New York, New Jersey, and California — have outright banned the plans. But for patients who haven’t been deliberately denied affordable coverage in this way, short-term plans remain a workable tool for staying insured during the coronavirus downturn.

Finally, enrolling in Medicaid is an option for those with no savings to fall back on. So the idea that Americans rendered jobless by the pandemic are without coverage options is plainly false.

Yet much of Democrats’ case for “Medicare-for-all” relies on scaring Americans into thinking that they’re one misstep away from ruin — and thus need the government to take care of them.

But as we see in other countries with socialized medicine, single-payer would consign Americans to long waits and rationed care. They wouldn’t have access to the latest drugs and medical technology. And they’d have fewer choices in where and how to receive care. Doctors are likely to respond to Medicare for All’s lower payment rates by reducing the supply of care they’re willing to provide — or leaving the profession altogether.

It makes little sense to cancel the coverage of the more than 150 million people who get it through work to address the needs of a mere fraction who are currently uninsured because of the worst economic crisis in a century. But that’s what Democrats bent on “Medicare-for-all” are aiming to do.

Sally C. Pipes is President, CEO, and Thomas W. Smith Fellow in Health Care Policy at the Pacific Research Institute. Her latest book is False Premise, False Promise: The Disastrous Reality of Medicare for All (Encounter 2020). Follow her on Twitter @sallypipes.

This article was originally published by the Pacific Research Institute.

California to let absent lawmakers vote during pandemic

The California Assembly changed its rules on Monday to let lawmakers at high risk for the coronavirus vote on bills without being present in the chamber, defying advice from the Legislature’s own lawyers who say the new rule is likely illegal.

It’s the first time in the state Assembly’s 170-year history that absent lawmakers will be allowed to vote on bills. Assembly leaders say the rule is necessary to protect the health and safety of its members after a coronavirus outbreak last month infected at least six people who work there. One of two lawmakers to get sick was briefly hospitalized.

But critics warn legal challenges could cancel any bills the Legislature passes over the next month as they rush to finish a pandemic-shortened session. …

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