by Mario Rizzo
I am disturbed by the Obama administration’s revised rule regarding the provision of birth-control products and service under the new health insurance system they have created. The original rule required all employers, particularly for our purposes institutions affiliated with the Catholic Church, to provide insurance that covers birth control without copayment , coinsurance or deductible. The Church hierarchy and others protested that they should not have to provide insurance that reimburses or pays for activities they regard as immoral. So then after a politically troublesome firestorm, President Obama and Secretary of Health and Human Services Kathleen Sebelius announced a revised rule.
The revised rule requires all employers, particularly for our purposes institutions affiliated with the Catholic Church, to provide insurance that covers birth control without copayment, coinsurance or deductible. What a relief.
Re-read that sentence. It is exactly the same as the previous rule. Can it be?
Previously, the Catholic institutions would have had to pay for the birth control coverage in the insurance. Now they have been relieved of that by their masters. The insurance companies will be required to provide the coverage free of charge.
The first thought of a rational person should be that the costs will simply be spread over all of the insured in the institution. The insurance company will make a single estimate of the payouts and come up with appropriate premiums. The law, as I understand it, does not permit the federal government to make sure that the insurance company absorbs the cost. (But I do not know what schemes they may come up with.)
But we need not worry about this. Secretary Kathleen Sebelius assures us that the coverage is costless. She said that experience tells us that the savings in child birth and child services will more than offset the costs of birth-control pills and sterilization. But, to be on the safe side, she said we shall just assume that it offsets the cost.
But that was true (presumably) under the old rule. Under the old rule the Catholic institutions would be paying nothing extra for the coverage. Under the new rule the Catholic institutions will be paying nothing extra for the coverage. I am repeating myself…
Perhaps there will be some different paperwork for reimbursement. Yes, I insist. The government could at least include that as a token of the difference between the two rules.
What foolishness this is.
But let’s go back. Was the Catholic hierarchy wrong in objecting to the old rule because under the Sebelius actuarial calculus they would not have been paying (extra) for it all along?!
Let’s look more closely at that. Is the objection paying for coverage or providing access to coverage in the course of employment at a Catholic institution? The fact that I do not pay the provider of such services does not mean that I am not responsible for letting him on my property, so to speak. In any event, people need not take jobs at institutions whose values they do not share.
There is more. Of course the institution is paying for the services. A woman gets a prescription for birth-control pills. She fills out a form for reimbursement. The insurance company goes into the pot of money into which the premiums have been paid and takes out the appropriate amount and pays her. Simple. The institution pays.
It is true that the woman did not, in a counterfactual state of the world, seek reimbursement for birth services and child medical services. That is where the savings come in. But that is not what is happening. What is happening is that she is getting reimbursed for birth control out of the premiums paid by the institution.
One more point, (I am really getting tired now.) In those institutions which self-insure – that is, collect the premiums, run the risk of shortfall themselves and allocate to the insurance companies only the task of management – there can be no pretext that the “insurance company pays.”
So far the Catholic bishops are resisting this. They are right to do so. First, the rights of religious institutions as independent moral agents were denied by the first rule. Second, their intelligence is mocked by the second rule which is the first rule restated.
There are two lessons in all of this. The first lesson is that Obama and his team are what Adam Smith referred to as men of system. They cannot tolerate foci of different values in their world:
“The man of system, on the contrary, is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it. He goes on to establish it completely and in all its parts, without any regard either to the great interests, or to the strong prejudices which may oppose it. He seems to imagine that he can arrange the different members of a great society with as much ease as the hand arranges the different pieces upon a chess-board. He does not consider that the pieces upon the chess-board have no other principle of motion besides that which the hand impresses upon them; but that, in the great chess-board of human society, every single piece has a principle of motion of its own, altogether different from that which the legislature might chuse to impress upon it. If those two principles coincide and act in the same direction, the game of human society will go on easily and harmoniously, and is very likely to be happy and successful. If they are opposite or different, the game will go on miserably, and the society must be at all times in the highest degree of disorder. (Theory of Moral Sentiments, VI,ii, 42) “
Secondly, the Catholic bishops must realize that they are reaping what they sowed. By and large, they supported Obamacare. Furthermore, they should realize the broader point that religious values are not the only important values in a free society. Policies which suppress the free choices of employers and employees alike through diktat are immoral.
18 thoughts on “Morality as Word Magic”
For those who have the arrogance to believe they can improve the citizens’ lives by controlling them, every person is no more than a chesspiece, to be moved around as the elite at the top think best. This belief is then a short step from believing that they can also make the country “better” by manipulating the chesspieces.
It wouldn’t be so bad if they made these moves within the constraints of income available, but they get so enamored with their great schemes that they borrow trillions of dollars to carry them out! Consequently, even if the schemes somehow proved to be beneficial, we would still all end up broke!
[…] Morality as Word Magic […]
The Smith quote doesn’t make sense. It must be transcribed wrong.
I’m pleased Mario posted on this controversy, which has many dimensions. The conflict between Obama and religious institutions (not just the Catholic Church) harkens back to one between Mussolini and the Catholic Church. It involves hatred of all private, mediating institutions.
As I read it, the Catholic Church has now hardened its position. It now supports the right of conscience for all individials (which should have been its position from the start). As John Cochrane has observed, the solution is for everyone to be able to opt out.
Good post in the link, Jerry.
Today’s Wall Street Journal has devoted the entire Letters section on the Opinion page to this issue.
These are the kinds of conflicts that inevitably arise when government power is allowed to progress to the point it has reached.
What is particularly galling is how left-collectivists are couching the issue in terms of people being “denied” birth control. You’re not denied something just because somebody else is not required to pay for it.
On the other hand, rightwing-collectivists, including especially religious zealots, have not been averse to using the power of government to coerce others into conformity with their preferences, so it’s hard to have a whole lot of sympathy for them either.
How the heck is birth control a matter for insurance, anyway? Without all this government intervention, I should think people would carry medical insurance only to cover large, unpredictable expenses, as from a developing a serious disease or suffering a major accident.
@ Allan Walstad: Very good question. “How the heck is birth control a matter for insurance, anyway? Without all this government intervention, I should think people would carry medical insurance only to cover large, unpredictable expenses, as from a developing a serious disease or suffering a major accident.”
A WSJ piece makes a similar argument from a legal perspective:
[…] a hypothetical group of professionals would find the “compromise” to be Orwellian (see Rizzo and Landsburg and […]
It turns out that, according to the New York Times, some 70-80% of large Catholic institutions self-insure. This means that even the illusory revised rule clearly does not apply there.
Jerry writes, “The conflict between Obama and religious institutions (not just the Catholic Church) harkens back to one between Mussolini and the Catholic Church. It involves hatred of all private, mediating institutions.”
The last sentence is a masterpiece of misguided exaggeration. Does Mr. Obama really hate “all private mediating institutions”? Does he hate all churches, all neighborhood organizations, all PTAs, all tennis clubs, and all labor unions?
And, by the way, why should we accept the Catholic bishops’ view on contraception rather than the view of 98% of sexually active Catholic women who practice birth control?
Carilli and Dempster want to shift the emphasis of ABCT from the effects of interest rate changes to changes in the monetary footprint. They cite an example of a small increase in the value of firm’s debt due to an increase in the interest rate from 6 to 7%.
They mention Mises’ division of interest into the originary rate and the entrepreneurial component, the latter being determined on the loan market with the involvement of political risk factors.
Like all Austrians of whom I’m aware, they overemphasize the loan market in the analysis of the effects of interest rates on the economy, and ignore other markets, such as the equity market, both publicly traded (stock market) and private equity.
Interest rates are used to value cash flows for both debt and equity, as well as in making other capital investments.
(The 1990s tech boom was an equity market event, not a debt market occurence.)
Boehm-Bawerk (capital structure) and Wicksell (natural rate of interest) /Mises (originary and entrepreneurial rates) put the two major components of the ABCT into place.
It’s time to expand the ABCT by enlarging the enrepreneurial component from the (overemphasis on) loan market to all the markets it affects via cash flow calculations.
Doing this will improve the theory and show just how irrelevant the criticisms of Tulloch, Wagner, and other critics are.
Those are not my words and you know it. I invite readers to go the link I provided and see how you distorted what I wrote. Just as you are distorting the nature of the controversy.
Greg asks: “Does (Obama) hate all churches, all neighborhood organizations, all PTAs, all tennis clubs, and all labor unions?” The answer is he does, unless they give him money and unwavering support. Obviously the labor unions he loves–He gave them most of the stock in General Motors! He loves ACORN and tried to grant them mucho government subsidies. But he hates the mainstream religious organizatuions because he is an over-educated liberal intellectual atheist.
Greg also asks : “And, by the way, why should we accept the Catholic bishops’ view on contraception rather than the view of 98% of sexually active Catholic women who practice birth control.”
Because that 98% usuage, if true, proves beyond any reasonable doubt that there is no problem for anyone gaining access to birth control. Therefore why force church hospitals to do anything? His goal is simply a vengeful vendetta to impose his atheistic beliefs on everyone else. Enough already with this False Messiah!
Jerry, you write, “Those are not my words and you know it. I invite readers to go the link I provided and see how you distorted what I wrote. Just as you are distorting the nature of the controversy.”
I didn’t quote anything from your link. I quoted from your post above (February 13, 2012 at 10:56 am), which reads,
“The conflict between Obama and religious institutions (not just the Catholic Church) harkens back to one between Mussolini and the Catholic Church. It involves hatred of all private, mediating institutions.”
I’m not sure what you mean when you say “those are not my words” because they are, in fact, your exact words.
[…] Hat tip: Mario Rizzo […]