“Dick Rowland Image”

”Shoots (News, Views and Quotes)”

– A New Take on Affordable Housing

By Adrian Moore, Vice President of Reason Foundation

Email: mailto:Adrian.Moore@Reason.org

Affordable housing is a hot topic these days where I live, and I bet
where you are as well. I live in a rural area, and it is such a big
deal here we have Habitat for Humanity projects going. And I can
understand the source of concern-my own house has appreciated 100
percent in just 5 years.

But when it comes to housing policy and concerns about making sure those
with low incomes have access to homes, the issue gets complicated. The
most common response by policymakers is mandated affordable housing
quotas or housing subsidies.

But a new report from the New York Federal Reserve by an economist from
Harvard and one from Pennsylvania’s Wharton School points a different

In “The Impact of Building Restrictions on Housing Affordability,” the
authors argue that in the most of the country housing prices are very
close to construction costs. Where prices are high relative to
construction costs, economic analysis shows that the major culprit is
restrictive zoning. They also point out that many popular policies,
like “smart growth” policies to increase density, affordable housing
mandates, and subsidies, don’t do much to help. Attacking zoning and
other regulations on housing is the best way to make homes more

You can get the study at

In Reason’s study “Repairing the Ladder: Toward a New Housing Policy
Paradigm,” Harvard’s Howard Husock lays out a new approach to affordable
housing policy — http://www.rppi.org/ps207.pdf

And at UrbanFutures.org you can find a wealth of research on housing
policy and alternatives — http://www.urbanfutures.org.

– SBSC Chair Karen Kerrigan Testifies Before Congress on the Status of
the Paperwork Relief Act

SBSC Chairman Karen Kerrigan testified before the House Government
Reform Subcommittee this week to review the results since the Small
Business Paperwork Relief Act (PRA) was passed in 2002. The legislation
aims to reduce government paperwork on small businesses.

In her testimony, Kerrigan stated: “Time and again, we have heard from
small businesses about their desire to have a more simplified approach
to filing and complying with federal regulations and their paperwork
requirements. The intent of the PRA 2002 reflected those chief and
long-standing concerns, which continue to be expressed by small
businesses to this day. Therefore, if it important that the OMB continue
to proceed and make progress on these specific actions in order to make
measurable inroads on paperwork reduction.”

Read the full text of Kerrigan’s testimony and analysis on www.sbsc.org

– New Zealand Tax Raisers in Deep Doo-Doo

While it wasn’t exactly reminiscent of America’s Boston Tea Party,
farmers in New Zealand have decided to raise a stink over the latest tax
imposed on them by their parliament. The Parliament there has approved a
tax for “research into methane gas emissions from agricultural animals,”
according to a recent AP story, known locally as the “flatulence-tax.”

As part of their protests, farmers and ranchers in New Zealand have
taken to sending sheep and cow manure thru the postal system to the
members who voted for the tax increase. One presumes it must be so the
members can do their own research on the matter.

Above articles are quoted from Small Business Survival Committee, Weekly
Briefing on Business and Government 7/18/03 http://www.sbsc.org

”Roots (Food for Thought)”

– Is Health Care a Commodity?

By Ronald Bailey

The drumbeat for nationalized health care is growing louder again.
Marcia Angell, a former New England Journal of Medicine editor and now
lecturer in social medicine at Harvard, declared in The New York Times
last October that our health system is near collapse. To prevent this
calamity, she claims, “What we need is a national single-payer system.”
She would model a national singlepayer system on Medicare and finance it
“through a new tax on income earmarked for health care.”

We should do this, Angell argues, because medical care is an essential
service “like education, clean water and air and protection from crime,
all of which we already acknowledge are public responsibilities.” Never
mind that many Americans do not believe that public agencies are in fact
providing adequate schooling, pollution control, and crime prevention.
Angell nevertheless insists, “The fatal flaw in the system is that we
treat health care as a commodity.”

The fatal flaw is really that we don’t treat it enough like a commodity.
Necessities like food, clothing, and housing are generally provided here
through private for-profit markets-markets in which we can choose for
ourselves, with an enormous range of options, exactly how much of any
given thing we want to purchase, and are using our own dollars to
purchase it. It is true in a sense that health insurance in the United
States is still provided mostly through private markets. It’s a product
that is purchased, though in most cases Americans get their health
insurance through their jobs as a form of compensation and have to take
what’s offered that way. This limits the ability to shop around for
exactly what you want to pay for.

Another big difference between health insurance and things like food is
that state insurance authorities mandate the minimum level of benefits
that insurance companies are allowed to offer. This means that Americans
who are insured generally get fairly extensive coverage, but at a high
price-and with severely limited choices.

In other areas, we accept that the distribution of wealth is unequal:
that some people live in small condominiums while others dwell in
McMansions. Some eat at Jean-Georges, while others are lucky to dine at
Carl’s Jr. And some shop Ross Dress For Less while others browse through
Saks. And these decisions seem to work out pretty well, with people for
the most part getting what they need, if not always what they want.

But imagine if state regulators insisted that only haute cuisine and
high fashion could be offered? Costs would obviously get prohibitive for
many. Why do state regulations stymie this process of choice and
differentiation leading to cheaper, more available options in health
care? Is there a better way?

There is, and South Africa, of all places, hints at how it works in
practice. It’s true, of course, that South Africa is still quite poor
compared to the U.S., and thus, according to Eustace Davie, a director
of the Free Market Foundation of South Africa, only 7 million of South
Africa’s 44 million citizens purchase private health insurance. But the
country’s health insurance industry at least is able to begin pursuing a
solution to the problem of money and coverage: It offers different
levels of coverage to fit different levels of income. Since 1992, a
private health care provider called Discovery has enrolled over 1
million members and is growing rapidly. Discovery offers “American
style” fee-for-service health insurance combined with medical savings
accounts, called personal medical funds. In fact, Discovery has launched
an American subsidiary called Destiny Healthcare, offering the same sort
of package.

Discovery offers a number of incentives for healthy living. For example,
your fees go down if you join a gym and exercise there a certain number
of times per year. Also, the plan includes an annual physical checkup.
In addition, as incentives, Discovery offers lowcost airline flights and
even cheap movie tickets.

Typically, health insurance from a company like Discovery costs 2,400
rand (around $240
U.S.) per month for a family. Comprehensive policies, without the
medical savings account and high deductibles, cost about 3,000 rand
($300 U.S.) for a family of four. This puts Discovery out of range for
many South African blue-collar workers. The average maid is paid between
600 and 800 rand ($60-80 U.S.) per month and the average miner makes
2,400 rand ($240 U.S.) per month.

Blue-collar workers in South Africa can also choose the Protector Group.
It offers an HMO option with unlimited benefits within its system (no
choice of service provider) for about 1,000 rand ($100 U.S.) monthly and
a Clinicare option which caps benefits at 100,000 rand ($10,000 U.S.)
for as low as 280 rand ($28 U.S.) per month, rising in tandem with the
insured’s income.

An even cheaper option, particularly popular with South African miners,
is offered by the Ingwe Health Plan, which features a variety of
low-cost options. Ingwe has a network of its own hospitals and contracts
out with a number of service providers. The cheapest health coverage
plan offered by Ingwe costs about 300 to 500 rand ($30-50 U.S.) monthly.
The Ingwe plan typically appeals to black South Africans moving up in
the job market.

In contrast to the robust commercial health care sector, South Africa’s
public/government health care system is falling apart, according to
Davie. The post-apartheid South African government declared in 1994 that
it would offer universal health care by 2008, but the government is
beginning to back down from that goal. Corruption and outright theft are
growing problems in the public hospitals, Davie says.

Nevertheless, excellent health care can be obtained in the private
sector. With the fall in the rand’s value, medical tourism is catching
on. The South African government even touts this trend toward “Sun, Surf
and Surgery” package tours. A coronary bypass operation that would
typically cost $30,000 in the U.S. costs the equivalent of $7,000 in
South Africa. Medical tourism is particularly popular among Britons who
are seeking faster and better care than they can get under their own
socialized medical system.

Clearly, as the example of South Africa shows, markets can provide
health insurance for people earning very different levels of income. And
in a country much richer than South Africa, like the United States, the
effect of that more diverse market on the percentage of citizens covered
is apt to be far more dramatic.

By allowing more differentiation in health insurance markets, many, if
not most, of those Americans who are currently uninsured could purchase
a basic level of health coverage. Furthermore, even insured Americans
could opt out of the third party payment system and purchase the
insurance they want rather than be locked into whatever plans their
companies impose on them. Finally, Americans offered a choice of health
insurance plans would be empowered to decide what level of coverage they
are comfortable with and able to afford. In other words, freely
functioning, less regulated markets in health insurance would go a long
way toward alleviating the “health care crisis.”

Ronald Bailey, Reason’s science correspondent, is the editor of Global
Warming and Other Eco Myths (Prima Publishing) and Earth Report 2000:
Revisiting the True State of the Planet (McGraw-Hill). This article was
originally published on Reason Online on February 12, 2003

Above article is quoted from The Heritage Foundation, The Insider May
2003 http://www.heritage.org

”Evergreen (Today Quotes)”

“Nationalism is an infantile disease. It is the measles of mankind”
— Albert Einstein

“When words lose their meaning, people lose their liberty.” — Confucius

”’Edited by Richard O. Rowland, president of Grassroot Institute of Hawaii, 1314 S. King Street, Suite 1163, Honolulu, HI 96814. Phone/fax is 808-591-9193, cell phone is 808-864-1776. Send him an email at:”’ mailto:grassroot@hawaii.rr.com ”’See the Web site at:”’ http://www.grassrootinstitute.org/