Elon Musk’s Controversial Politics: Beyond the Financials

As U.S. President Trump signed his “Big Beautiful Bill” into law on July 4, 2025, Elon Musk, shareholder and CEO of Tesla, announced that he would create a new political party (or “group” in European-speak). Musk opposed the projected trillions of dollars that the bill would add to the debt held by the U.S. federal government, though, as CEO of SpaceX, he was fine with cutting a trillion dollars from Medicaid, which provides health coverage to the poorest of the poor, and from food assistance while the defense budget was augmented. Musk’s proposed “America” group would likely draw support from Trump’s “MAGA” base, rather than from moderate Republicans and any Democrats. Whether Musk was more motivated by breaking up the political duopoly of the two major parties, or groups, to increase the practical options for voters or to split Trump’s support and punish the Republican party, such controversial political involvement by a major shareholder CEO is without doubt risky business. This is not to say that CEO’s should not be active politically apart from business strategy, for even business managers are citizens and thus may feel compelled to become active politically. This is to be lauded especially if the motive is out of duty to repair or otherwise improve a political system.

On the next working day after Musk’s announcement that he would be forming a new political party, “Tesla shares plunged nearly 7 percent . . . as investors registered dismay” at Musk’s “plans to form a third party and his intensifying feud with President Trump.”[1] Even though 7% is not exacting “plunging” or “crushing” Testa shares, beyond the hyperbole of journalists is the point that not avoiding controversy politically has costed Tesla and Musk himself financially. To be sure, billionaires can afford to lose significant wealth and still be left standing comfortably, and even in the case of business practitioners, economic reductionism doesn’t always hold. Also, political involvement can raise stock prices, as, for example, “Musk’s involvement in politics and his financial support for the president’s campaign were once seen by investors as a benefit to Tesla, fueling a steep rise in company shares after the election” in November, 2024.[2] No one but the most cynical would deny, however, that Musk’s chief motivation that led to his involvement in “DOGE” in the White House was for his businesses to benefit even though they did, initially. So that they took a hit when Musk broke from President Trump and then formed the America Party cannot be assessed only as concerns the financial impact on Tesla or SpaceX.

In American history, the notion that wealthy people should devote some time to public service for the benefit of the Union or their respective member-states was once well-known. Both because such people could afford financially to take time off from business and because their experience could be useful in governing, the notion of public duty was beneficial to the public good. Men like Thomas Jefferson and George Washington did not make public service into a career and did not go into politics primarily for its positive financial benefit. As a frustrated General dependent on the sovereign states whose delegates met in the Second Continental Congress, Washington would not have endured such hardships as he did were his motivation simply to benefit himself and his landholdings in Virginia financially. Even though Musk is by no stretch another Washington, more has been involved in Musk’s political motivation than maximizing Tesla’s stock price or gaining government contracts for SpaceX, and even getting back at Donald Trump. Government, moreover, is not just the aggregate of business interests without remainder.

Other billionaires might look to Musk’s example not in terms of his political ideology necessarily, but in terms of having enough financial cushion to weather political-turned-financial pushback from going beyond business to engage in public service—to give back, as it were, so to improve the system of government and add to the public good. It is admittedly very easy to be guided by personal and business financial considerations in delving into politics, whereas being willing to hold those at bay out of a sense of public duty is more difficult, and, frankly, increasing rare as American history has proceeded but not necessarily evolved politically. The notion that duty pertains to citizenship has become increasingly recessive in public discourse and consciousness. This is to say that duty-bound CEO’s are saints; rather, it is to say that we shouldn’t be so surprised when a billionaire businessman jumps into politics not merely for financial reasons, and thus not turn back to shore after a financial hit. Even if motivated by political ideology rather than in saving the union from itself (e.g., public debt), personal and business financial benefit is not the whole story, and the public good can still be a beneficiary. 

Mozi says, "'worthy people [are] those who are well versed in virtuous conduct, discriminating in discussion, and broadly knowledgeable!’ . . . . When the wealthy and eminent in the state heard this they retired and thought to themselves, ‘At first, we could rely on our wealth and eminence, but now the king promotes the righteous and does not turn away the poor and the humble. This being the case, we too must be righteous.'"[3]

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1. Jack Ewing, “Musk’s Idea of 3^rd Party Is Crushing Testla Shares,” The New York Times, July 8, 2025.

2. Ibid.

3. Philip J. Ivanhoe and Bryan W. Van Norden, ed.s, Readings in Classical Chinese Philosophy (New York: Seen Bridges Press, 2001), 58.

Is Healthcare a Human Right?

Humanity still has not come to a consensus on what are entailed specifically within the rubric of human rights. Even in terms of those specifics that have come to be generally held to be human rights, such as in designated war crimes and crimes against humanity by international agreement, the lack of de jure and de facto enforcement render such agreement nugatory in practice. As a result, calls for human rights are in effect calls for warring to stop. The enforcement that goes along with laws legislated by governments render any consensus on what constitutes human rights more substantive in practice. This is undercut, however, in empire-scale polities of polities, such as the E.U. and U.S., to the extent that human rights are carved out at the federal level to applied across differing cultures. Such ideological diversity between the American member-states has triggered drastically-different notions of just what are included as human rights to be played out in Congress. The debate over the government-financed health-insurance program for the poor in 2025 illustrates such a lack of consensus, which in turn suggests that the member-states should play more of a role in how or even whether to provide free insurance to the poor. Sometimes, one size doesn’t fit all. In short, the matter of federalism is very relevant up front, before matters of the proper role of government itself and of human rights are decided. In other words, the qualitative and quantitative differences between a union of states and a state are very relevant up front, lest states eventually peel off in utter frustration with a one-size-fits-all approach to policy-making to fit an empire composed of member-states.

As the U.S. Senate considered changes to the Medicaid program, Republican Sen. Josh Hawley acknowledged “that the main cost-saving provision in the bill—new work requirements on able-bodied adults who receive health care through the Medicaid program—would cause millions of people to lose their coverage. All told, estimates are 10.9 million fewer people would have health coverage under the bill’s proposed changes to Medicaid and the Affordable Care Act.”[1] Millions would be relegated to not getting medical attention or going to the emergency rooms of hospitals mandated to treat the uninsured, who would be strapped with unaffordable medical bills and thus bad credit-reports.

That a significant number of poor people in the United States would lose health-insurance was known and anticipated by the legislators. Speaking on the bill as it was taking shape in the U.S. Senate, Sen. Hawley said, “I know that will reduce the number of people on Medicaid.”[2] What, then, justifies the loss of health coverage? The senator answered this question by adding, “But I’m for that because I want people who are able bodied but not working to work.”[3] In other words, being able to have access to medical services should be conditional on having a job. The conditionality itself means that health care is not a human right because such rights are inherently unconditional.

Some or even many of Sen. Hawley’s constituents doubtless favored excluding medical services from being included among other human rights, perhaps in the belief that people who are able to work but refuse to work do not deserve to be kept alive if they fall sick, which in turn can be based on a belief that only the strong of any species should survive. Sen. Hawley represents Missouri, when is generally conservative. Sen. Warren of Massachusetts, on the other hand, would find that the conditionality and thus the exclusion of medical care from human rights much less popular in her member-state. Such a wide divide by state on this question would be unlikely in the E.U., even between the states of Hungary or Poland and Sweden or the Netherlands. The European notion of subsidiarity would thus be more applicable in this case to the U.S. than the E.U., given the greater diversity of ideology on the question in the United States. In other words, federalizing universal healthcare would come with less ideological tensions between E.U. citizens in different states than between U.S. citizens in different states; there was more consensus within the empire-scale European Union than within the American bloc.

The imposition of work requirements as a condition for the poor having access to medical treatments may be just fine with most people in Texas and Utah, for example, and yet be very objectionable to most people in Vermont and Connecticut. To conflate these various member-states as being ideologically and culturally homogenous is suboptimal and comes with political costs as opposition pressure is likely to result where the federal policy is unpopular; more optimal politically would be transferring the program of Medicaid to the member-states so their respective peoples could tailor the program—or even cancel it—according to their respective political ideologies. The notion that policy in another state should reflect one’s own views is anathema to federalism, and even to there being empire-scale unions of states. Toleration within a union is thus necessary lest one size be applied throughout and eventually republics break off in frustration, as Britain did from the European Union due primarily to anti-federalist sentiment.

In short, finding a large gap from consensus in Congress (or in the E.U.’s legislature) can be an indication that a policy question would be better resolved by the member-states than at the empire-level, given the heterogeneity between states on the question. Congress and the federal president applying work requirements on what most people in some states regard as an unconditional human right may be intolerable emotionally to those people, but so too, Obamacare had been viewed as an intolerable overreach of government to most people in some other states. Behind this chasm, ideological and thus as emotional as cognitive, lies a basic disagreement on just what should constitute human rights, and thus be an obligation of government. In other words, besides different political philosophies of the proper role of government, different moral principles are involved on the question of whether government should pay for healthcare for the poor. In a federal system, the matter of where such a divisive policy question should be decided should be decided before both the proper-role-of-government and the human-rights questions are decided, or else the federal system itself would be compromised and thus put at risk.

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1. Leah Askarinam, “The GOP’s Big Bill Would Bring Changes to Medicaid for Millions,” Apnews.com, June 15, 2025.
2. Ibid.
3. Ibid.

Beyond Collectivism and Individualism: Freedom from Fear

In his speech on April 13, 2011 on reducing the U.S. Government deficits, President Obama identified two strains that had run through the country’s political history and thus informed the American political culture. “More than citizens of any other country” he said, “we are rugged individualists, a self-reliant people with a healthy skepticism of too much government. But there has always been another thread running throughout our history – a belief that we are all connected; and that there are some things we can only do together, as a nation.  We believe, in the words of our first Republican president, Abraham Lincoln, that through government, we should do together what we cannot do as well for ourselves.”[1]  These two strains can be identified as individualism and collectivism, respectively. I contend that collectivism enables both individual and collective security. Individual security is oriented to a person’s survival and collective security is exemplified by national defense. 

In his speech, the president explicitly placed individual security within the collectivist strain. “Part of this American belief that we are all connected also expresses itself in a conviction that each one of us deserves some basic measure of security.  We recognize that no matter how responsibly we live our lives, hard times or bad luck, a crippling illness or a layoff, may strike any one of us.  ‘There but for the grace of God go I,’ we say to ourselves, and so we contribute to programs like Medicare and Social Security, which guarantee us health care and a measure of basic income after a lifetime of hard work; unemployment insurance, which protects us against unexpected job loss; and Medicaid, which provides care for millions of seniors in nursing homes, poor children, and those with disabilities.”  That is, limits to rugged individualism exist, whether in the state of nature or in an interdependent economy, and collectivized programs can bridge the gap on an individualized basis such that individuals can continue to enjoy liberty. The individualist/collectivist dichotomy is thus not so clearly dichotomist.

According to Obama, societal connectedness with others, something limited to the family or clan in the state of nature, implies the societal duty of individuals with economic surplus to contribute to the survival needs of other individuals, especially those who cannot fend for themselves. Individuals pay taxes and individuals receive sustenance benefits—the collectivism seems in actuality to mean systemic.

I have noticed that rich Europeans tend to acknowledge both that they too may someday be in need of such benefits, and that, under the principle of solidarity, a duty exists to pay higher taxes than otherwise so other people may survive rather than perish. As the American president pointed out in his speech, hard luck can befall each of us; no one is immune from calamity and ruin. Europeans seem to get this; American’s don’t.

Europeans also seem to recognize a basic psychological ease of mind exists in knowing that even in the worst-case scenario, a safety net exists. Even if a rich or middle-income American never needs to draw on Social Security and Medicare in retirement, whether due to age or disability/illness, the psychological security afforded by this recognition through life is surely worth something to the individual. Such a person (i.e., with economic surplus year to year) can justify on self-interest alone paying more in taxes to feel even this subtle peace-of-mind (i.e, individual security) through life. In other words, the narrow breed of self-interest (i.e., selfishness) that exists in American culture as a common trait among individuals is not even in the individual’s own interest. Such individualism is thus faulty.

I have not come across many rich Americans who recognize that they too may need such services (ignoring the stock market crashes of 1873, 1929 and others); such people thus view sustenance-oriented taxes as paying for lazy people to play or do drugs. Should such people therefore die? As disgusted as I am with the American inner-city “ghetto” mentality that potential employers justifiably eschew, I believe that to say people with such entrenched mentalities should therefore die for want of sustenance violates human rights, which are not conditional. Too many Americans may be guilty of an entrenched selfishness whose greed knows no bounds even at high levels of wealth. The selfishness that sees narrowly only that earning or amassing more wealth is possible at any level is utterly blind to the foundational peace of mind that comes with having confidence that a safety net even for oneself exists.

Together, callousness toward others less fortunate and selfishness concerning wealth are, I submit, just as ugly as a “fuck society, the rules don’t apply to me” ghetto mentality. A bad odor surrounds both even if some noses are immune to their own smell. In contrast, imagine a society in which the fear stemming from a recognition that survival itself is conditional even out of the state of nature, in “advanced” societies, is absent. The psychological effects even from the removal of such a subtle, subterranean fear, can be significant. My dad used to refer to “quality of life” as being an important attribute of reaching an old age. Yet the importance of obviating a sustenance-conditional fear in a person’s quality of life even when the quality is otherwise good tends to be missed by most Americans in their prime. The Titanic can’t sink!

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[1] Barak Obama, “Text of Obama Speech on Deficit,” The Wall Street Journal, April 13, 2011.

A U.S. Senator Aiding a Contributor While Averting a "Fiscal Cliff": Turning a Crisis into an Opportunity

The law passed by Congress on January 3, 2013 to avert the across-the-board tax increases and “sequester” (i.e., across-the-board budget cuts) was “stuffed with special provisions helping specific companies and industries.” While many of the provisions would increase the U.S. Government’s debt, at least one would decrease it. Is the latter any more ethical because it is in line with the more general interest in reducing the federal debt? Put another way, does the end justify the means?  Do good consequences justify bad motives?  These are extremely difficult questions. The best I can do here is suggest how they can be approached by analysis of a particular case study.

In the legislation, a provision reduced the Medicare reimbursement rate for a radiosurgery device manufactured by the E.U. company Elekta AB. The cut was pushed by a competitor, Varian Medical Systems. Senate Majority Leader Harry Reid asked Sen. Max Baucus, chair of the Senate Finance Committee, to write the cut into the legislation. While both senators could point to the public interest in the debt-reduction result of the cut, their relationship with Varian makes their motives suspect. Specifically, they may have exploited personal conflicts of interest that eclipsed a more expansive duty to the wider (i.e., not private, or personal) public interest. 

While it is perhaps simplistic to relate campaign contributions to a senator’s subsequent action, it is significant that Varian spent  $570,000 in 2012 on lobbying. The company added Capitol Counsel, which had contacts to Sen. Baucus. Vivian already had connections to Reid through Cornerstone Government Affairs lobbyist Paul Denino, a former Reid deputy chief of staff. Additionally, the leading beneficiary of the contributions of Varian executives and the company’s PAC over the previous four years was Sen. Reid, whose committees received $21,200. Varian’s lobbyists added $42,700 more to Reid’s campaign.[1] While Sen. Reid’s subsequent urging of the reimbursement rate cut could have been unrelated to these contributions and contacts, the senator’s involvement compromises him ethically. Put another way, it is at the very least bad form, or unseemly. It implies that companies making political contributions and hiring lobbyists connected to public officials do so (or worse, should do so) to have special access to those particular officials to turn upcoming legislation to the companies’ financial advantage. Even if the public also benefits, it can be asked whether the companies deserve their particular benefits. In the case of Varian, it may be asked whether the company deserved the cut in the reimbursement rate going to Elekta.

As could be expected, spokespersons at both companies sought to argue the merits of their respective cases in the court of public opinion.  It is more useful to look at the regulators’ rationale for increasing the reimbursement rate for Elekta’s  “Gamma Knife” in the first place. Originally, the knife and Varian’s linac machines were lumped together by the Centers for Medicare and Medicaid Services (CMS) under the same CMS code. In 2001, the Centers separated the devices in terms of data collection so an analysis could be conducted on whether the devices should receive different reimbursement rates. The Huffington Post reports that the reimbursement rate for the Gamma Knife was increased because “it typically requires only one treatment, while the linacs often require multiple treatments.” Also, “Gamma Knives machines are more expensive to obtain and maintain due to the storage of radioactive cobalt and regulation by both the Nuclear Regulatory Commission and the Department of Homeland Security. Linacs don’t use nuclear material and are regulated by the Food and Drug Administration.”[2] So, due to the cost and use differential, CMS  increased the Gamma Knife reimbursement in 2006 to $7000. From the standpoint of the criteria of regulators, the data-collection and analysis method and the rational rationale are legitimate. In contrast, because neither the use or cost differential had changed by January 2013, the cut in the reimbursement rate cannot enjoy such legitimacy. Hence it is possible that exogenous factors, such as the political influence of Varian’s lobbyists and campaign contributions, were behind the change. From the standpoint of the previous rate differential, the change cannot be justified. Neither Sen. Reid nor Sen. Baucus could justify their actions (and motives) by the substance of the case. However, they could still appeal to the salubrious budget-cutting effect as justifying their involvement.

The question here is whether the favorable consequences of the cut on the government’s subsequent deficits mitigates or reduces the shady scenario of a senator acting on behalf of a company that had contributed to his or her campaign. I would advise a member of Congress to avoid even the appearance of a conflict of interest. If the result in this particular case is in the public interest (i.e., reducing the deficit), does this positive consequence justify the senators’ actions and even the questionable appearance?  It’s a no-brainer that the senators would immediately point to the public interest in the consequence, but does it effectively remove the taint of immoral political conduct (and perhaps motive)?

The link between the company-senator relation, the senators’ action in which the company stands to benefit financially in a material way, and the financial benefit to the company can be distinguished ethically from a good consequence to the public. A bystander would naturally view the consequence to the public as salubrious even while having a sentiment of disapprobation toward the company’s own benefit as well as the senators’ action and relation to the company. In other words, the favorable impact on the public does not remove the stain on the company and the senators. To be sure, that stain would be greater were the public harmed rather than helped, but even with the positive general consequence the senators may have acted for the private benefit. Also, their action could have come from other senators, hence obviating the ethical problem. In short, the public interest does not remove either senator from the ethically problematic situation in which they decided to occupy.  Even if their motive had been solely for the public interest, they violated the appearance of unethical motive and conduct.

“The end justifies the means” is a slippery slope in terms of what the human mind can rationalize as legitimate. Great harm has been seemingly justified by great ideals. Even in the face of the ideals, the harms provoke a sentiment of disapprobation by the observer (excepting sociopaths). This suggests that the ideals cannot completely justify unethical means.  It may indeed be that unethical means are necessary in some particular cases, but this does not render the devices ethically pure. Ethical principles do not know practical compromise. Rather, people do.

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1. Paul Blumenthal, “Varian Medical Systems Used Fiscal Cliff Deal to Hurt Competitor,” The Huffington Post, February 8, 2013.

2. Ibid.

Unsustainable Structural Fiscal and Federal Imbalances: The American Union

The nonpartisan Congressional Budget Office (CBO) announced on January 26, 2011 that the U.S. Government’s budget deficit for the year would soar to nearly $1.5 trillion, which represents $414 billion more due to the extension of the Bush tax cuts. The deficit had been $1.4 trillion in 2009 and $1.3 trillion in 2010. According to the New York Times, based on the CBO, “the deficits of $1.4 trillion in 2009 and $1.3 trillion in 2010 are, when measured as a share of gross domestic product, the largest since 1945 — representing 10 percent and 8.9 percent of the nation’s output.” The budget officials also projected the deficit for 2012 would be $1.1 trillion. These figures dwarf the budget deficits even of the 1980s.

In his State of the Union speech on January 26th 2011, President Obama called for a partial five-year freeze in domestic spending by the federal government — what the New York Times calls “a more gradual imposition of fiscal discipline, while still increasing some spending in education, research and other areas.” It is hardly imaginable how a freeze alone could make a dent where the debt is over $14.3 trillion—a figure that is scarcely conceivable to a human mind, let alone sustainable. It is not clear that the U.S. Government will ever be able to pay off the mammoth debt, let alone arrest the annual increases in the debt (i.e., the deficits).

For their part, Republican congressional leaders used the need for a budget and an extention in the debt-ceiling in 2011 to pressure Democratic leaders to adobt substantial cuts, rather than merely a freeze. As a result, President Obama himself came to urge $4 trillion in cuts over several years. Yet even as the Republicans, whose penchant for less government (and perhaps restoring federalism) dovetailed with more cuts in federal spending, this position too did not take sufficiently seriously the U.S. Government's deficit and debt, for tax increases were to be off the table. 

In short, neither of the major parties were taking the structural fiscal imbalance in the U.S. Government sufficiently seriously.  It is as though they were urging the use of a bicyle rather than a car or train to get from Orlando to Miami in Florida (and let's add just for fun, "in August"). Beyond other objectives (such as less government) being allowed to intercede, the proposals were not sufficient. Were reducing the structural deficits and debt of the U.S. Government the overriding goal, both trillions in tax increases and spending cuts would be instituted over many yeears. I contend that it to be a moral imperative that the debt amassed since the surpluses in the late 1990s be paid off before the mean age in the generation of 18 to 38 year-olds in 2000 retire. The remaining debt could be paid off in incremental installments over many years. Simply passing on our debt for others to pay would be as immoral as it is convenient. 

Fortunately for us, restoring a balanced federalism can facilitate paying off the debt in our lifetimes. Rep. Paul Ryan's proposal for block grants to the state governments for medicaid claims to shift that program for the poor from the U.S. Government to the states. It is thus in the direction of restoring a balance in American federalism. However, the block grant element retains the federal purse-strings, and thus falls short in this regard. Both in terms of reducing the federal government's annual deficits and restoring a federalist balance, Rep. Ryan should have proposed that the states both run and pay for medicaid by raising state taxes. It would be up to the respective voters of the states to decide the level of coverage and the amount of tax increase--taking into account their respective state's' fiscal position so as to deal with any deficit there as well. Medicare too could be transferred to the states, though it would not be prudent to leave it up to the states to fund it until after states such as Florida, California and Illinois have solved their own structural deficits. Policy decisions involving health-care for the poor and the elderly could thus be tailored to the circumstances and ideologies that tend to differ in a union on an empire-scale. However, federal taxes would not decrease accordingly on account of the structural deficits and the objective of paying off the accumulated federal debt. Once the latter is eliminated, the federal taxes could come down.

One might squauk, "But that would mean raising my state taxes without corresponding tax cuts at the federal level!" Correcto! The lack of symmetry here is the mirror image of the asymmetry that has been involved in running deficits of over $1 trillion for years and having amassed a federal debt of over $14 trillion. We like asymmetry when it is convenient but abhor it when it goes against our pocket books. This combination of sentiments is what we must counter, bottom-line.  

Sources:

David M. Herszehhorn, “Deficit Forecast Nears $1.5 Trillion, Fueling Partisan Battle on Federal Spending,” The New York Times, January 26, 2011.

Stephen Gandel, “View from Davos: How Bad is a $1.5 Trillion Deficit?” Time, January 27, 2011.

De-Funding Obamacare

It is odd that even after a bill becomes a law, it can be defunded, thereby effectively killing it even though it has not been voted down.  One would think that it would be required to pass the funding that is required by the law. The Republican Party has strategized on how to deconstruct Obama’s health-insurance law through various means.

Republicans could turn to the annual appropriations and budget process or push stand-alone bills to delay or stop funding for provisions of the law they dislike, including the individual mandate, the health insurance exchanges and the Medicaid expansion. They might also work to weaken provisions in the bill that deal with Medicare physician reporting requirements that some physicians find onerous and block the creation of a nonprofit research institute to examine the effectiveness of various medical treatments. Mandatory funding, which comprises much of the health measure that began in 2014, will continue unless Republicans can change current law. Discretionary funding must be approved each year but differences between House and Senate versions of appropriations measures must be ironed out and that generally produces a compromise package. Why all of the law’s funding would not be mandatory as part of the law defies logic and government functioning. Also, how the mandatory funding could comprise much of the law when the individual mandate, the exchanges, and the medicaid expansion can be defunded, is also beyond me.

A major problem with the defunding strategy is that since so much of the bill is inter-related, trying to dismantle it piecemeal could lead to unintended consequences. While the individual mandate is unpopular, “you can’t pull it out of the law without all sorts of other elements falling apart,” Reischauer says. And scrapping the mandate, which requires most people to have coverage or pay a penalty, would anger health insurers — a core GOP constituency. Insurers have agreed to abide by new consumer protections, such as not denying coverage based on a pre-existing medical condition, in exchange for 32 million new customers. Hospitals agreed to payment cuts on the premise that more people would have health care and hospitals would have less uncompensated care. In other words, because the health insurance industry got basically what it wanted—the mandate without a public option—it would be highly unlikely that certain parts of the law would be defunded unless it were in the interest of the health insurance companies.  Therefore, the mandate is not apt to be defunded unless the rest of the law is to go down too.

I contend that law should not be allowed to be defunded. That is, upon passage, the law should have its required funding established as a matter of law.  Secondly, I contend that private companies with a vested interest in a law should not be allowed to have such power that they can tailor the law to their liking. Extant industries have too much power in the US Government.  As a reflection of this condition, we over-rely on private companies and the market—ignoring their downsides. Where basic necessities such as access to basic health-care is concerned, our over-reliance can be fatal.

Source: http://www.msnbc.msn.com/id/39295110/ns/health-health_care/

Leadership by Elected Representatives: Transcending the Politics of Slashing Vulnerable Federal Programs and Avoiding Tax Increases

On January 20, 2011, months before the Republicans would use leverage of a baleful debt-ceiling-default to extract additional cuts, the Republican Study Committee (RSC)—a group of fiscally conservative members of the U.S. House of Representatives—announced a plan by which $2.5 trillion could be cut from the U.S. Government's spending over ten years. According to The New York Times, the proposed cuts “would exclude the military, and would not touch the big entitlement programs, Medicare and Social Security. As a result, [their] effect on the entire array of government programs, among them education, domestic security, transportation, law enforcement and medical research, would be nothing short of drastic." The leaders of the RSC claimed that the cuts were “appropriate and necessary, given the government’s $14 trillion debt and annual deficits at their highest levels since the years just after World War II." The RSC "proposed generally reducing agency budgets to their levels in 2006 — the last time Congressional Republicans controlled the budget process — and then freezing them, with no annual inflation adjustments.” The RSC also recommended “slashing the federal workforce by 15 percent and canceling pay raises for five years, for a total of $2.29 trillion in savings.” Finally, the proposal included “an additional $330 billion in cuts to specific programs, including Amtrak, foreign aid and even the Washington subway system" (Source #1).

Analysis:

Back in July 2009, The New York Times reported that most Americans continued to want "the federal government to focus on reducing the budget deficit rather than spending money to stimulate the national economy" (Source #2). Nevertheless, Congress and the President went ahead in 2010 with extending the Bush tax cuts, which were expected to add an expected $850 billion to the deficits of 2011 and 2012. The President had proposed to extend the tax cuts for the lower and middle classes, which would be more apt to spend rather than save the difference and thus stimulate the economy then in a weak, jobless recovery. The congressional Republican leadership demanded that the tax cuts be continued for the wealthy as well, even though the latter could afford to pay more in tax and would be less apt to spend than save the money from the cuts. If the proposed spending cuts were “necessary” given the sizes of the deficits and debt, it would seem that the tax cuts—even those likely to be spent and thus stimulating—would have been a luxury the U.S. Government could ill-afford. That is to say, the deficits and debt could play second fiddle to stimulating the economy, only to be the reasons for “necessary and appropriate cuts.”

Besides dovetailing with the Republican goal of less government—particularly at the federal level—the combination of tax cuts and budget cuts sends mixed signals as to the importance of the U.S. Governments deficits and accumulated debt. Within the proposed spending cuts alone, cutting in some areas while leaving others—notably defense—completely untouched sends similarly schizophrenic signals regarding the seriousness of the deficits and debt. If the financial affairs are perilous, the U.S. Government could ill-afford protecting defense contractors and other sacred cows.

To be sure, Americans polled overwhelmingly said that they prefer cutting government spending to paying higher taxes, according to The New York Times (Source #3). The RSC's proposal was in line with this finding. Also, the proposal was in line with the poll's finding that nearly two-thirds of Americans do not want Medicare or Social Security benefits cut even to reduce deficits. At the same time, unlike the RSC’s proposal, the poll indicated that Americans by a wide margin preferred cutting the Pentagon's budget to cutting benefits in Medicare and Social Security; the RSC proposal treats all three areas the same (leaving them all off the chopping block).

However, those who are led by polls cannot lead, for leading involves moving the polled rather than being moved by them. Furthermore, the citizenry may not have fully aware of how serious deficits of over $1 trillion and a debt of over $14 trillion are to the viability of the United States. The seriousness of the deficits and debt require tax increases and spending cuts (including sacred cows) even if the general populous is not much bothered by the threat.

Representatives have to use judgment to know when to be agents reflecting the will of the people who sent them and when to lead constituents who sent them but would view the indebtedness as more precarious had they studied the matter more fully. In other words, elected representatives sometimes need to be critical of what their constituents think is in their true interest and that of the United States as a viable system. As faithful agents, representatives must look in such cases to the best interest of their district and to the United States as a viable concern. Going beyond polls, leaders are oriented to protecting the led even from themselves.

Sources:

1.      David M. Herszenhorn, “G.O.P. Bloc Presses Leaders to Slash Even More,” The New York Times, January 20, 2011.

2.      Dalia Sussman, “New Poll: Bring Down Debt, Don’t Spend More,” The New York Times, July 29, 2009.

3.      Jackie Calmes and Dallia Sussman, "Poll Finds a Willingness to Cut Spending, Just not Medicare or Social Security," The New York Times, January 21, 2011, p. A11.