The Heritage Insider: Even the IRS thought the plain meaning mattered, Stan Evans's conservative revolt, what if Wisconsin had been right-to-work 30 years ago? and more
Updated daily, InsiderOnline (insideronline.org) is a compilation of publication abstracts, how-to essays, events, news, and analysis from around the conservative movement. The current edition of The INSIDER quarterly magazine is also on the site.
March 7, 2015
Latest Studies
45 new items, including a Tax Foundation dynamic analysis of the President’s tax initiatives, and a 36-step plan for ed reform from the Center for College Affordability and Productivity
Notes on the Week
Even the Internal Revenue Service thought the plain meaning of ObamaCare mattered, Stan Evans sparked a conservative revolt, what if Wisconsin had been right-to-work 30 years ago?
To Do
Find out what’s next for relations between Russia and the West
Latest Studies
Budget & Taxation
• To Cut or Not to Cut? – Cato Institute
• Revisiting the Rain Tax: Fix it or Scrap it? – Maryland Public Policy Institute
• Florida Fiscal Policy: Responsible Budgeting in a Growing State – Mercatus Center
• Regressive Effects: Causes and Consequences of Selective Consumption Taxation – Mercatus Center
• A Dynamic Analysis of President Obama’s Tax Initiatives – Tax Foundation
• Eliminating Double Taxation Through Corporate Integration – Tax Foundation
• Suggestions for Improvement in the Ohio FY 2016-17 Budget – Tax Foundation
• The Growth Effects of the Nunes Plan to Reform Business Taxation – Tax Foundation
• Economic Effects of Eliminating Texas’ Business Margin Tax – Texas Public Policy Foundation
• Time for Property Tax Reform – Texas Public Policy Foundation
• Washington Governors Show Pattern of Breaking No-Tax Promises – Washington Policy Center
• Crowding Out What Matters: The 2016-2017 State Budget – Yankee Institute for Public Policy
Crime, Justice & the Law
• Pretrial Justice 101: Key Points for Policymakers – Texas Public Policy Foundation
Economic and Political Thought
• Federalism and Freedom: Orestes Brownson’s Case for the Federal Constitution – The Heritage Foundation
Economic Growth
• Making the New Normal Meaningful – American Enterprise Institute
• Patent Policy Change Would Undermine Property Rights and Innovation – The Heritage Foundation
Education
• A Policymaker’s Guide to No Child Left Behind Reauthorization – American Enterprise Institute
• Thirty-Six Steps: The Path to Reforming American Education – Center for College Affordability and Productivity
• The State of K-12 Union Contract Transparency – Independence Institute
Elections, Transparency, & Accountability
• Advance Notice of Proposed Rulemaking on Aggregate Biennial Contribution Limits – The Heritage Foundation
• The Liberty City: A New Concept for Self-Governance – Texas Public Policy Foundation
Foreign Policy/International Affairs
• Combating Human Trafficking in Asia Requires U.S. Leadership – The Heritage Foundation
• U.S.–India Relations: From Possibilities to Progress – The Heritage Foundation
Health Care
• A Post-King Bridge to Somewhere Better – e21 – Economic Policies for the 21st Century
• King V. Burwell and the Rule of Law – The Heritage Foundation
• King v. Burwell: An Opportunity for Congress and the States to Clear Away Obamacare’s Failed Policies – The Heritage Foundation
• King v. Burwell – Independent Women’s Forum
• Certificate-of-Need Laws: Implications for Florida – Mercatus Center
• The Crisis in Drug Research and Development – National Center for Policy Analysis
Immigration
• A Review of the Department of Homeland Security Policies and Procedures for the Apprehension, Detention, and Release of Non-Citizens Unlawfully Present in the United States – Center for Immigration Studies
• The President’s Executive Actions on Immigration and Their Impact on Federal and State Elections – The Heritage Foundation
Information Technology
• Title II Reclassification Is Rate Regulation – Free State Foundation
• The FCC’s Anticompetitive Greenlight: Commission Is Wrong to Override North Carolina Law for Municipal Broadband – John Locke Foundation
International Trade/Finance
• The Trans-Pacific Partnership and America’s Strategic Role in Asia – American Enterprise Institute
Labor
• How Unions and Right-to-Work Laws Affect the Economy – The Heritage Foundation
• State Labor-Management Policy and the Texas Model – Texas Public Policy Foundation
• The Economic Impact of a Right-to-Work Law on Wisconsin – Wisconsin Policy Research Institute
Monetary Policy/Financial Regulation
• Federal Reserve Accountability and Reform – American Enterprise Institute
• Consumers Shortchanged? Oversight of the Justice Department’s Mortgage Lending Settlements – The Heritage Foundation
National Security
• Congress Should Expand Trusted Traveler Programs and Private Airport Screeners – The Heritage Foundation
Natural Resources, Energy, Environment, & Science
• Too Much Energy? Asia at 2030 – American Enterprise Institute
Regulation & Deregulation
• A Questionable History of Regulatory Reform Since the APA – Mercatus Center
• Comprehensive Regulatory Impact Analysis: The Cornerstone of Regulatory Reform – Mercatus Center
• Regulatory Reform Can Amount to a Progressive Tax Refund, If Done Right – Mercatus Center
Transportation/Infrastructure
• Massachusetts Experience with Hard and Soft Receiverships – Pioneer Institute for Public Policy Research
Notes on the Week
Even the Internal Revenue Service thought the plain meaning of ObamaCare mattered—at first. This week, the Supreme Court heard oral arguments in King v. Burwell, the central question of which is: Did Congress really mean to provide subsidies only for health insurance purchased in state exchanges and not federal exchanges, too? That would appear to be the case judging from the plain meaning of the section that authorizes tax credits for health insurance purchased “through an Exchange established by the State.” One key argument advanced by the government, however, is that “Exchange established by the State” is merely a term of art that includes the fallback federal exchanges. If that were true, then the Internal Revenue Service would be exactly right to make the credits available in all exchanges.
But the agency’s behavior in 2011 suggest it didn’t really believe that. Michael Cannon notes that an early draft of the IRS was faithful to the text of the law, but was later changed when IRS officials realized that fidelity to the text might undermine the goal of broad expanding coverage. Further:
IRS officials recognized that what they wanted to find in the statute simply wasn’t there. In a March 25, 2011, e-mail, Treasury and IRS officials described the lack of authorization for subsidies in federal Exchanges as a “drafting oversight.”
IRS officials also recognized the “apparently plain” language limiting tax credits to state-established Exchanges. Investigators found that a draft of the final rule contained a discussion of this issue that “stated that agencies have broad discretion to reasonably interpret a [law] if the ‘apparently plain statutory language’ is inconsistent with the purpose of the law.” Agency officials dropped that discussion from the final rule shortly before issuing it.
IRS officials chose to issue tax credits in federal Exchanges “because they concluded this was required for the new health-care initiative to succeed,” the Washington Post reported. “And, the officials reasoned, Congress would not have passed a law that it wanted to fail.” [National Review, March 4]
If agency officials had understood the phrase was a term of art, then they wouldn’t have needed to ponder the outer limits of executive discretion. And if the phrase had really been a term of art, then why didn’t the agency charged with implementing the law understand that?
Another argument advanced—mostly in the media—by those trying to save the IRS’s interpretation is that ObamaCare’s regulations would make health insurance too expensive without the subsidies, which would undermine health insurance markets in the states that chose not to establish exchanges. And that would, so this theory goes, amount to unconstitutional federal coercion of the states, which Congress couldn’t have intended.
As James Taranto points out, however, an interpretation of a law can be both correct and unconstitutional, since “Congress has been known to enact unconstitutional laws[.]” And anyway, there is a simpler remedy than letting the executive branch change tax laws without congressional authorization:
[I]t is more or less the same one the court used with Medicaid in NFIB v. Sebelius: permit states to opt out of ObamaCare’s regulatory burdens at the cost of their residents’ forgoing subsidies. If the appellants prevail in King, one suspects state attorneys general will be standing by to file lawsuits seeking such relief. [Wall Street Journal, February 27]
M. Stanton Evans, R.I.P. 
After graduating from Yale, Evans began writing for National Review in the magazine’s very early days. He would write for both National Review and Human Events regularly for decades.
In 1960, he became the youngest editor of a metropolitan daily newspaper, the Indianapolis News. That same year he helped found Young Americans for Freedom, authoring the group’s founding statement of principles. Adopted at the first YAF meeting at William F. Buckley’s family home in Sharon, Conn.—and thus known as the Sharon Statement—the Evans-authored credo shaped the modern conservative movement as a fusion of libertarian and traditionalist principles. William Rusher said the statement came as close as “there will ever be to a statement of the original principles of the modern American conservative movement.”
As chairman of the American Conservative Union from 1971 to 1977, Evans helped the Reagan campaign mount a challenge to President Ford for the 1976 Republican nomination. Ford eventually won the nomination, but Reagan’s momentum leading up to the convention laid the foundation for his 1980 run. Reagan’s challenge, however, would have died in March of that year had he not won the North Carolina primary. And he would not have won the North Carolina primary without Stan Evans and the American Conservative Union.
ACU had joined the lawsuit known as Buckley v. Valeo, the landmark case that challenged federal limits on campaign contributions and spending. After the Supreme Court upheld contribution limits but not spending limits, Evans convinced the ACU board to approve independent expenditure campaigns on behalf of Ronald Reagan in Illinois, North Carolina, and Texas. Candidate Reagan had lost the previous five state primaries and was being urged to pull out. ACU’s campaign, which featured over 882 radio commercials that aggressively outlined the differences between the moderate Ford and the conservative Reagan, helped Reagan pull off the upset in North Carolina.
Evans founded the National Journalism Center in 1980 because he believed that the best way to fight liberal bias in the news was to have more reporters producing good, honest journalism. He explained: “I don’t think that the way to correct a spin from the left is to try to impart a spin from the right. […] [A]n information flow distorted from the right would be just as much a disservice as distortion from the left. What we really should be after […] is accurate information. And I don’t see what any conservative or anybody else for that matter has to fear from accurate information.”
Under Evans’ direction NJC trained thousands of journalists, including John Fund of National Review, William McGurn of the Wall Street Journal, John Merline of USA Today, book writer Malcolm Gladwell, columnist Ann Coulter, and commentator Greg Gutfeld.
In addition to Revolt on Campus, Evans wrote seven other books. Evans’s The Theme Is Freedom challenged the liberal view that the writers of the U.S. Constitution were primarily inspired by enlightenment ideals. Evans traced their influences back to Christian roots, showing how their commitment to individual liberty was built on Christian precepts.
Evans undertook another debunking of the liberal version of history in Blacklisted by History: The Untold Story of Senator Joseph McCarthy and His Fight for America. He dug into the declassified files of the Federal Bureau of Investigation and showed that McCarthy, while perhaps imprudent in some of his methods, was essentially correct in his charge that there was a security problem in the United States government in the early 1950s.
Evans also published Consumers’ Research magazine for over two decades. The magazine, published since 1927, had been one of the few consumer magazines sympathetic to the idea that the free market is the consumer’s best friend. Evans took over publication of the magazine in order to keep it going, explaining that it would be a shame if Consumer Reports were to have a monopoly on consumer reporting. Evans’s Consumers’ Research published articles explaining how the rise in third-party payment was at the center of the problems in health care, how competition in cable television lowers prices, and why energy regulations never work. “Consumers’ Research,” he would tell people “is the magazine that understands that Ralph Nader is hazardous to your health.”
Evans was also the author of some of the most memorable bon mots on politics. Here are three of our favorites:
“Liberals don’t care what you do as long as it’s compulsory.”
“We have two parties here, and only two. One is the evil party, and the other is the stupid party. I’m very proud to be a member of the stupid party. Occasionally, the two parties get together to do something that’s both evil and stupid. That’s called bipartisanship.”
“We all know that Mrs. Clinton has complained about the vast right-wing conspiracy, and of course, she is correct about that, and we are all part of it, but when I was starting out, it was only half vast.”
Indeed, today the movement is a lot more right-wing and a lot less half-vast because of Evans; and the country is at least a little bit freer, too, because of his good works.
Stan Evans on how Indiana is a little different than Washington, D.C. We could reprint a bunch of Stan’s best lines, but there’s nothing like hearing them delivered by the man himself. Here is Stan accepting the American Spectator’s 2011 Barbara Olson Award:
Evans’s words live on. When the country lost Stan Evans earlier this week, it lost one of the most brilliant exponents of conservative principles of the past half century. Lovers of clear thinking and truth telling will still be reading Stan’s books and articles generations from now. But one of Stan’s most important works does not contain his byline. That is the Sharon Statement, adopted by Young American for Freedom at its founding meeting in 1960. Ed Meese III calls the Sharon Statement “a declaration of the modern conservative philosophy that guided the movement for decades and continues to be a strong statement of conservative principle today.” We think you’ll not find a more succinct and precise statement of conservative beliefs. Like the rest of his works, it stands the test of time and should be a source of inspiration for coming generations of conservatives. Here it is in full:
IN THIS TIME of moral and political crisis, it is the responsibility of the youth of America to affirm certain eternal truths.
WE, as young conservatives, believe:
THAT foremost among the transcendent values is the individual’s use of his God-given free will, whence derives his right to be free from the restrictions of arbitrary force;
THAT liberty is indivisible, and that political freedom cannot long exist without economic freedom;
THAT the purpose of government is to protect those freedoms through the preservation of internal order, the provision of national defense, and the administration of justice;
THAT when government ventures beyond these rightful functions, it accumulates power, which tends to diminish order and liberty;
THAT the Constitution of the United States is the best arrangement yet devised for empowering government to fulfill its proper role, while restraining it from the concentration and abuse of power;
THAT the genius of the Constitution – the division of powers – is summed up in the clause that reserves primacy to the several states, or to the people in those spheres not specifically delegated to the Federal government;
THAT the market economy, allocating resources by the free play of supply and demand, is the single economic system compatible with the requirements of personal freedom and constitutional government, and that it is at the same time the most productive supplier of human needs;
THAT when government interferes with the work of the market economy, it tends to reduce the moral and physical strength of the nation, that when it takes from one to bestow on another, it diminishes the incentive of the first, the integrity of the second, and the moral autonomy of both;
THAT we will be free only so long as the national sovereignty of the United States is secure; that history shows periods of freedom are rare, and can exist only when free citizens concertedly defend their rights against all enemies…
THAT the forces of international Communism are, at present, the greatest single threat to these liberties;
THAT the United States should stress victory over, rather than coexistence with this menace; and
THAT American foreign policy must be judged by this criterion: does it serve the just interests of the United States?
Soon responds. Global warming skeptic Willie Soon responded to his critics this week. They had accused him of failing to disclose funding he had received from industry sources. Noting how the controversy has spawned a congressional fishing expedition targeting other scientists whose work doesn’t fit neatly into the doomsday narrative of climate change, Soon stated: “This effort should be seen for what it is: a shameless attempt to silence my scientific research and writings, and to make an example out of me as a warning to any other researcher who may dare question in the slightest their fervently held orthodoxy of anthropogenic global warming.”
Regarding the allegations about his disclosures, Soon stated:
I have never been motivated by financial gain to write any scientific paper, nor have I ever hidden grants or any other alleged conflict of interest. I have been a solar and stellar physicist at the Harvard-Smithsonian Center for Astrophysics for a quarter of a century, during which time I have published numerous peer-reviewed, scholarly articles. The fact that my research has been supported in part by donations to the Smithsonian Institution from many sources, including some energy producers, has long been a matter of public record. In submitting my academic writings I have always complied with what I understood to be disclosure practices in my field generally, consistent with the level of disclosure made by many of my Smithsonian colleagues.
If the standards for disclosure are to change, then let them change evenly. If a journal that has peer-reviewed and published my work concludes that additional disclosures are appropriate, I am happy to comply. I would ask only that other authors—on all sides of the debate—are also required to make similar disclosures. And I call on the media outlets that have so quickly repeated my attackers’ accusations to similarly look into the motivations of and disclosures that may or may not have been made by their preferred, IPCC-linked scientists. [Heartland Institute, March 2]
What if Wisconsin had been a right-to-work state 30 years ago? Wisconsin is poised to become a right-to-work state, which means workers can’t be required to join a union as a condition of employment. Wisconsin workers can expect more investment in their state and faster wage growth as a result of this move. Richard Vedder, Joseph Hartge, and Christopher Denhart:
Over the last 30 years, states with right-to-work (RTW) legislation have experienced greater per capita personal income growth than other states. And that positive correlation between right-to-work and higher incomes remains true even after controlling for other important variables (such as tax rates in various states) that might have had a simultaneous impact.
Our statistical results suggest that, in fact, the presence of a RTW law added about six percentage points to the growth rate of RTW states from 1983 to 2013. With such a law, Wisconsin’s per capita personal income growth of 53.29% would have been, instead, about 59.29%. Wisconsin would have gone from having economic growth below the national average over those three decades to having slightly above average growth – enough above average that it would have erased the current income per capita deficit between Wisconsin and the nation as a whole.
Wisconsin’s per capita personal income received from all sources in 2013 was $43,244, according to the Bureau of Economic Analysis – $1,521 less than the national average of $44,765.
Our regression analysis suggests that had Wisconsin adopted a RTW law in 1983, per capita income would have been $1,683 higher in 2013 than it actually was – and would have brought the state slightly over the national per capita personal income average. [“The Economic Impact of a Right-to-Work Law on the Wisconsin Economy,” by Richard Vedder, Joseph Hartge, and Christopher Denhart,” Wisconsin Policy Research Institute, February 2015]
Class warfare! Finds the Joint Committee on Taxation:
For 2015, the top 10 percent (in terms of income) of all tax returns receive 45 percent of all income and pay 82 percent of all income taxes. The top five percent of all tax returns receive 34 percent of all income and pay 71 percent of all income taxes. The top one percent of all tax returns receives 19 percent of all income and pay 49 percent of all income taxes. [“Fairness and Tax Policy,” Joint Committee on Taxation, February 27, as quoted at TaxProfBlog, March 2]
To Do: Find Out What’s Next for Relations Between Russia and the West
• Assess how the Ukraine conflict will affect Russian-Western relations in the years ahead. The Heritage Foundation will host a talk by Eugene Rumer, co-author of Conflict in Ukraine: The Unwinding of the Post-Cold War Order. Rumer’s talk will begin at noon on March 10.
• Find out what it will take for two of America’s most important allies to get along with each other. The American Enterprise Institute will host a panel discussion on Japan-Korea relations at 50. The event will begin at 9 a.m. on March 13.
• Celebrate the life of Stan Evans. The Heritage Foundation will host a reception honoring the man who helped spark the conservative revolt. The event will begin at 11 a.m. on March 13.
• Examine our options for combating terrorism. The John Locke Foundation will host a talk by author Tony Tata at noon on March 9.
• Discover what’s next for trade between Canada and the United States. The Hudson Institute will host a panel discussion on how small and medium businesses can find customers across the U.S.-Canadian border. The discussion will begin at 1 p.m. on March 11.
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