Friday, December 27, 2013

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


Obamacare Showdown: Missouri Bill to Gut Obamacare, Ban Penalties, Ban Healthcare Exchange; How Would Obama Respond?

Posted: 27 Dec 2013 04:30 PM PST

If enough states act, we are on the way to a constitutional showdown over Obamacare. The Washington Times reports Missouri bill would gut Obamacare
Next month, the Missouri Senate will consider a bill which would effectively cripple the implementation of the Affordable Care Act within the state.

Following the lead of South Carolina, where lawmakers are fast-tracking House Bill 3101 in 2014, and Georgia, where HB707 was recently introduced by Rep. Jason Spencer, Missouri State Senator John T. Lamping (R-24) pre-filed Senate Bill 546 (SB546) to update the Health Care Freedom Act passed by Missouri voters in 2010. It passed that year with more than 70% support.

SB546 would ban Missouri from taking any action that would "compel, directly or indirectly, any person, employer, or health care provider to participate in any health care system." That means the state would be banned by law from operating a health care exchange for the federal government.

The bill also proposes suspending the licenses of insurers who accept federal subsidies which result in the "imposition of penalties contrary to the public policy" set forth in the legislation. Since it is unlikely that any insurer would then accept a subsidy, not a single employer in the state could be hit with the employer-mandate penalties those subsidies trigger.

Following significant portions of the Tenth Amendment Center's four-step plan to nullify Obamacare on a state-level, Fox News Senior Judicial Analyst Judge Andrew Napolitano noted that such actions were not just legal, but effective.

"If enough states do this, it will gut Obamacare because the federal government doesn't have the resources … to go into each of the states if they start refusing," he said.

Tenth Amendment Center national communications director Mike Maharrey suggested that a large-scale effort against the Act would be coming. "Our sources tell us to expect at least ten states moving in this direction in the coming months. But that will only come true if people start calling their state representatives and senators right now. State lawmakers need to know they should introduce bills to ban the state from participating in any Obamacare programs."
Nullify Obamacare

Inquiring minds are investigating the Nullify Obamacare website for further information.
INTRODUCTION

States have always held the prerogative of whether or not they will enforce or participate in federal acts or regulatory programs.  This legislative package seeks to ban the state from enforcing or assisting in the enforcement of the federal Patient Protection and Affordable Care Act of 2010.  It also seeks to ban the State, along with all its political subdivisions, from operating or participating in the operation of a health care exchange under the federal act.  It also provides for penalties for violations of the act.

FOUR STEPS

Step 1: Ban State Enforcement, Participation and Material Support
Step 2: Reject Medicaid Expansion
Step 3: Protect Residents from Mandates
Step 4: Challenge the IRS's illegal ObamaCare taxes

LEGAL BASIS

The "approach is on sound legal footing"
-Mercer University law professor David Oedel, part of the legal team that represented Georgia in its court challenge to Obamacare

There is a long-standing legal tradition which supports the choice of the State to determine whether or not they will participate in a federal act.

James Madison, writing in Federalist #46, recommended state responses to "unwarrantable" (unconstitutional) or merely "unpopular" federal acts which included "a refusal to cooperate with officers of the Union."

Supported by Supreme Court opinions spanning more than 150 years, the "anti-commandeering doctrine" is the legal principle that states are not required to help the federal government enforce federal acts or regulatory programs.

The cases are as follows:

* 1842 Prigg: The Court held that states were not required to enforce federal slavery laws.
* 1992 New York: The Court held that Congress could not require states to enact specified waste disposal regulations.
* 1997 Printz: The Court held that "the federal government may not compel the states to enact or administer a federal regulatory program."
* 2012 Sebelius: The Court held that states could not be required to expand Medicaid even under the threat of losing federal funding.

Anti-commandeering is virtually undisputed by legal experts from both the left and right.

EFFECT

A number of states following this plan will "gut Obamacare."
-Judge Andrew Napolitano on Fox News, 12-10-13
For more details on each of the steps, please see Model Legislation: Nullify Obamacare in 4 Steps

How Would Obama Respond?

Regardless of the constitutionality of this action by states, how could Obama act in response?

I suppose Democrats could cut off various state funding. But that would take a Democratic controlled Congress (and its pretty safe to assume that's not going to happen).

Would the Federal government setup health exchanges in states? With what funding?

This could get interesting if even three states nullify Obamacare, and allegedly 10 states are considering such action.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Fear the Octopus: Judge Says NSA Phone Surveillance Is Legal; Case Likely Headed to Supreme Court

Posted: 27 Dec 2013 11:48 AM PST

December 16 Ruling vs. Ruling Today

On December 16, in a rare victory for constitutional freedoms, U.S. District Court Judge Richard Leon, ruled NSA phone program likely unconstitutional. (See District Court Judge Rules NSA Phone Taps Likely Unconstitutional; 68 Page Ruling Cites "Orwellian Technology" and Unreasonable Searches).

In contrast, a Manhattan District judge ruled today NSA Phone Surveillance Is Legal
U.S. District Judge WIlliam H. Pauley III in Manhattan sided with the government in his decision Friday, calling the collection program a "vital tool" to combat terrorism and deeming it "the Government's counter-punch."

The ruling stands in conflict with a decision issued earlier this month in a separate case by a federal judge in the District of Columbia who said the program "almost certainly" violated the Constitution.

The New York case was brought in June by the American Civil Liberties Union, which claimed that the NSA was violating the group's constitutional rights by collecting metadata from the ACLU's phone calls. It was among the first big legal challenges against the NSA program after it was disclosed in June.

The group sought a court order declaring that the mass call logging violated federal law governing foreign intelligence surveillance as well as constitutional free speech and search-and-seizure protections.

Judge Pauley disagreed. "The right to be free from searches and seizures is fundamental, but not absolute," he wrote.
Case Likely Headed for Supreme Court

The Guardian comments on today's NSA Phone Ruling.
A legal battle over the scope of US government surveillance took a turn in favour of the National Security Agency on Friday with a court opinion declaring that bulk collection of telephone data does not violate the constitution.

Friday's ruling makes it more likely that the issue will be settled by the US supreme court, although it may be overtaken by the decision of Barack Obama on whether to accept the recommendations of a White House review panel to ban the NSA from directly collecting such data.

But the ruling from Judge William Pauley, a Clinton appointee to the Southern District of New York, will provide important ammunition for those within the intelligence community urging Obama to maintain the programme.

Judge Pauley said privacy protections enshrined in the fourth amendment of the US constitution needed to be balanced against a government need to maintain a database of records to prevent future terrorist attacks. "The right to be free from searches is fundamental but not absolute," he said. "Whether the fourth amendment protects bulk telephony metadata is ultimately a question of reasonableness."

Pauley argued that al-Qaida's "bold jujitsu" strategy to marry seventh century ideology with 21st century technology made it imperative that government authorities be allowed to push privacy boundaries.

"As the September 11 attacks demonstrate, the cost of missing such a threat can be horrific," he wrote in the ruling. "Technology allowed al-Qaida to operate decentralised and plot international terrorist attacks remotely. The bulk telephony metadata collection programme represents the government's counter-punch: connecting fragmented and fleeting communications to re-construct and eliminate al-Qaida's terror network."

The ACLU said it would appeal the decision, starting in the New York circuit. "We are extremely disappointed with this decision, which misinterprets the relevant statutes, understates the privacy implications of the government's surveillance and misapplies a narrow and outdated precedent to read away core constitutional protections," said Jameel Jaffer, ACLU deputy legal director.

Judge Pauley said his ruling did not mean it was right to continue with the program, which he acknowledged was a "blunt tool" that "imperils the civil liberties of every citizen" if unchecked. "While robust discussions are under way across the nation, in Congress, and at the White House, the question for this court is whether the government's bulk telephony metadata program is lawful. The court finds it is," he wrote. "But the question of whether that program should be conducted is for the other two coordinate branches of government to decide."
Conflicted Ruling

Pauley appears to to talking out of both sides of his mouth at the same time, each side saying a different thing.


  1. "The right to be free from searches and seizures is fundamental"
  2. "The right to be free from searches and seizures is not absolute" 

  1. Collection program a "vital tool".  Al-Qaida's "bold jujitsu" requires government to push privacy boundaries.
  2. Phone collection "blunt tool" that "imperils the civil liberties of every citizen" if unchecked. 

  1. "Bulk telephony metadata program is lawful"
  2. "It's for the other two coordinate branches of government to decide"

Fear the Octopus

Is Pauley a constitutional as well as hypocritical wimp or what? Hopefully the Supreme Court gets it right.

My fear is Obama makes some totally meaningless changes in the program to get the Supreme Court ruling he wants, then after the ruling, lets the NSA do whatever it wants, which is to collect everything on everybody, stored permanently.

Nothing Beyond the Octopus Reach

For more on the NSA and its illegal actions, please see the chilling report Nothing Beyond the Octopus Reach

My conclusion ...
The Patriot Act was anything but. It should be scrapped. James Clapper [Obama's Intelligence Director] should be prosecuted and spend the rest of his life in prison where he can think about the true meaning of patriotism.

Meanwhile, those looking for a true patriot ought to stand up and salute Edward Snowden. He risked his life, security, and personal freedom to protect the US constitution. What's more patriotic than that?
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Madrid Bans Vacation Home Rentals to "Protect Tourists" and "End Unfair Competition"

Posted: 27 Dec 2013 09:55 AM PST

In the name of "Protecting Tourists" Madrid Prohibits Vacation Rental Homes. Via Mish-modified translation from El Economista ...
Proposed rules would effectively prohibit homeowners from renting their homes. Rental licenses will be only given to properties for primary uses (hotels, offices, etc.), not to individuals for temporary use.

The Community of Madrid seeks "to establish minimum requirements designed to "protect the rights of tourists" and to "end unfair competition."

News follows rent laws published in June in which prime minister Mariano Rajoy allowed each of the 17 regions to legislate rentals on their own.

If approved, individuals will find it almost impossible to temporarily rent their home through internet sales as it will be very difficult to obtain a license to conduct such activity. According to the Hoteliers Association of Madrid (AEHM), there are currently about 8,000 community accommodations.
Clearly, the proposal seeks to eliminate competition to the unfair advantage of hotels. If hotels cannot compete against homeowners, they are charging too much for what they offer.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

European Monetary Union Misnamed; I Propose GEU (German Economic Union) or USG (United States of Germany)

Posted: 26 Dec 2013 11:23 PM PST

The irony and hypocrisy in chancellor Angela Merkel's first parliamentary speech of her third term would be astounding were it not par for the "Everything for Germany" course of action.

Please consider Chancellor Urges Reforms to Preserve Euro
In her first parliamentary speech since her re-election for a third term on Tuesday, she warned that Europe needed to take further action to make the euro zone crisis-proof.

More European Control

"I know that pushing through treaty changes in the member states can be difficult, but if you want more Europe, you have to be prepared to develop it further," Merkel said. "In a world that is constantly changing, we can't stand there and say that at some point we agreed the Lisbon Treaty and there's no need to change it again. This won't work."

Germany wants closer economic policy coordination and will push at a summit of European Union leaders on Thursday and Friday for members to agree binding contracts with the European Commission to implement further reforms.

It is also pushing for changes to the Lisbon Treaty to give greater European control over policy. Germany's closest ally in Europe, France, opposes such a move, as do other member states.

"European unity remains one of the most important tasks of the grand coalition," said Merkel. "Germany is only strong if Europe is strong."

Criticism of EU Green Energy Probe

She said she would fight an EU probe announced on Wednesday into exemptions from a green energy surcharge for some 2,000 German companies. The European Commission is examining whether the exemptions, totalling some €5 billion and granted to heavy energy users like the steel industry, were unfair and should be repaid.

The German government would not tolerate a weakening of German industry or job losses, she said. "Germany wants to remain a strong industrial location, we need competitive companies," she said. "This is about companies and when it's about companies, it's about jobs."

She said Germany's new Economy and Energy Minister, Social Democrat Sigmar Gabriel, would make this very clear to the European Commission.
Merkel the Hypocrite

Allegedly Merkel wants more EU controls. She is even at odds with France over controls. But let the EU propose energy controls and all of a sudden she does not want them.

Recall that Germany backtracked on the  banking union. Heck, Germany fought bitterly to have some of its banks specifically excluded from banking union provisions, and won.

Now Germany wants more integration. Except of course when it doesn't, like a true banking union deal a week ago, and energy controls today.

I am certainly not defending EU energy policy. But I am critical of the inherent hypocrisy in Merkel's plea for more EU controls when she does not want more EU control, but rather more German control.

Since this is par for the course, (and it will remain that way), let's put an appropriate label on it.

Do You Prefer

  1. GEU - German Economic Union
  2. USG - United States of Germany

Is it number 1 or number 2?

The question is moot actually, except for the short-term. Long-term, the European Monetary Union is doomed.

I made the case for a disorderly breakup in Laughable Eurozone Banking "Non-Union".

Merkel's first parliamentary speech of her third term adds credence to the disorderly breakup thesis.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

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