Obama recess appointments unconstitutional
This could wipe out a lot of regulations
In a case freighted with major constitutional implications, a federal appeals court on Friday overturned President Obama’s controversial recess appointments from last year, ruling he abused his powers and acted when the Senate was not actually in a recess.
The three-judge panel’s ruling is a major blow to Mr. Obama. The judges ruled that the appointments he made to the National Labor Relations Board are illegal, and hence the five-person board did not have a quorum to operate.
But the ruling has even broader constitutional significance, with the judges arguing that the president’s recess appointment powers don’t apply to “intra-session” appointments — those made when Congress has left town for a few days or weeks. They said Mr. Obama erred when he said he could claim the power to determine when he could make appointments.
“Allowing the president to define the scope of his own appointments power would eviscerate the Constitution’s separation of powers,” the judges said in their opinion.
The judges said presidents’ recess powers only apply after Congress has adjourned a session permanently, which in modern times usually means only at the end of a year. If the ruling withstands Supreme Court scrutiny, it would dramatically constrain presidents in the future.
A Health Scare for Small Businesses
Obamacare is discouraging job creation
During her two-plus years in business, Elizabeth Turley has steadily recruited new employees for her apparel company, Meesh & Mia Corp., to keep pace with its rapid growth. But this year could be different. Instead of increasing her staff, she plans to hire independent contractors for tasks that can be outsourced, such as marketing and product development.
Her reason? Meesh & Mia is on the cusp of having 50 full-time employees. If the company hits that threshold, it will have to provide health coverage that meets government standards or potentially pay a penalty.
Elizabeth Turley, CEO of Meesh & Mia, plans to hire independent contractors this year because of health-insurance changes. Ms. Turley looked at fabric options at a trade show Tuesday.
"We are poised this year to more than double or even triple business," says the 58-year-old Ms. Turley, whose Idaho-based company makes "spiritwear," or clothes with licensed college and football-team colors and logos. "And then this happened.... We have to find another way to get there."
Even though the rule doesn't go into effect until early 2014, a business could be subject to the so-called employer mandate if, during 2013, it averages 50 or more full-time equivalent employees, according to recently released regulations from the Treasury Department and the Internal Revenue Service.
Many small-business owners haven't yet realized that the way they structure their firm in 2013 could determine their status under the law in a year's time.
The government issued the little-noticed regulatory guidance on Dec. 28. Ms. Turley says she wasn't aware of the rules until a Journal reporter informed her.
To avoid the health-care law's penalties, many employers are considering hiring only part-time employees or deliberately curbing growth so that they have no need to hire.
For Ms. Turley, that isn't an option. Meesh & Mia needs more hired help. The best solution, she believes, is to hire independent contractors, who would be able to take on certain tasks without upping her headcount.
Typically, independent contractors are less expensive for employers, who don't have to pay taxes on wages or supply benefits, as they would for their employees. Reliance on independent contractors has increased over the years, particularly in the recession, when employers sought less expensive labor.
In December 2012, 6.7% of payroll checks written by small employers went to 1099 workers, or those not considered employees of a company, according to SurePayroll, a Chicago-based payroll firm that caters to 40,000 small employers with an average of seven employees. That's roughly double the 3.5% of payroll checks that went to 1099 workers in December 2007.
The trend is expected to accelerate this year given the framework of the looming health-care law, employment analysts predict.
Ms. Turley knows that hiring independent contractors isn't always ideal. "You have less control over hours they work and how much involvement they have in other parts of the business," she says. "Employees take more pride and ownership [in the company] than contractors."
In the past, in fact, she has hired contractors but later brought them into the fold as full-time employees.
Using independent contractors has long been a sensitive issue because of how they are classified for tax purposes. In late 2011, the IRS vowed to be more vigilant in finding employers who improperly label workers as independent contractors. At the same time it launched an amnesty program for employers to voluntarily reclassify workers in exchange for a reduced payment to cover back taxes.
"If anything, [audits] will increase more" in light of the health-care law, says Monique Warren, partner at workplace law firm Jackson Lewis LLP in White Plains, N.Y. "Employers have to be real careful about calling someone an independent contractor."
Government auditors would determine whether a worker misclassification triggers the health-care law's employer mandate. That means the stakes are higher for employers, particularly those who have close to 50 full-time employees. They could have to pay back taxes in addition to potential penalties associated with the health-care law, should the revised classification push their employee headcount over the threshold.
"Some businesses may be tempted to classify someone as an independent contractor to avoid the headcount that could subject them to the [employer mandate]," says Edward Lenz, senior counsel at the American Staffing Association, an Alexandria, Va., lobbying group for temporary and contract staffing firms. "If anything, the risks of misclassifications are exacerbated by the [health-care law]."
Adding to the confusion for small firms is that an employer's view of who is an independent contractor may not align with the government's. The guidelines defining independent contractors "aren't black and white," says Ms. Warren. "To some extent, it is deliberately vague. The IRS can't... account for every different situation."
Some considerations include an employer's level of control over a worker, the permanency of the relationship and how the business pays the worker. Because the definition lacks strict parameters, employers can file a form requesting the IRS to make the determination.
"This is on the hot list for the Department of Labor and the IRS," says Penny C. Wofford, employment law attorney at Ogletree, Deakins, Nash, Smoak & Stewart, P.C. in Greenville, S.C. "It's not enough to say a worker should be 1099 status just by their work contract. That's just one factor in a test."
The Collectivist Mind Game: Demonizing Human Nature
If Robert Heinlein were to write The Moon today (see Part 1), there's no doubt his notion of the future oppressive global government on Earth would be very different. With such forces at play, the free-market revolution in Lunar colonies would likewise be fought by different means, struggling to overcome the tidal wave of government indoctrination and demonization, in addition to an army of statist looters hiding behind the army of statist moochers, who will be hiding behind an army of statist Blue Helmets of the statist United Nations.
That would be an asymmetrical warfare if ever there was one. The individualist free-market rebels wouldn't be able to respond in kind by playing the collectivist mind games with the statists because it would turn them into their own enemies. Their only hope would be to learn to recognize the game when it is being played, not to fall for any of its seductive illusions, methodically expose the players at every turn, call every little manipulative trick in their arsenal for what it is, and help to immunize the rest against its corruptive influence.
The tidal wave of propaganda notwithstanding, the rebels would still have the most important ally on their side -- human nature. No matter into what society they are born and what mind conditioning they receive, people will never stop being competitive individuals. They will always long for individual freedom, rationality, objectivity, personal achievement, and the pursuit of a better life for themselves and their families.
Without these traits humanity would never have risen from the ignorant tribal collectivism of hunters and gatherers, with its brutal mores, dark superstitions, and average life expectancy of 30 years, when few lived long enough to develop complete self-awareness, formulate a coherent individual thought, and pass it onto others. There would be no division of labor, no markets, and no capitalist wealth to sustain the advances in science, arts, and technology -- let alone to feed the multitudes of Marxist intellectuals and statist plutocrats. There would be nothing to lose and nothing to fight for.
Admittedly, the Marxist notion of human progress is a spiral that would return humanity to that stateless, moneyless, classless, and selfless collectivism -- except on a higher level. For that purpose they must, so to speak, put the genie of individualism back into the bottle, and the only way they can do it is by demonizing human nature itself.
However, the 74 years of the morbid Soviet experiment failed to breed the New Collectivist Man. The communist "engineers of human souls" isolated millions of people from the rest of humanity by sealing off the nation's borders and creating a pressurized Marxist bubble. They rearranged the society, rewrote history, and reorganized the culture. They subjected several generations of children to intense mind programming. They blocked all undesirable news sources, books, films, and music. They rewarded "correct" thoughts and impulses, and punished the "incorrect" ones. They demonized greed, selfishness, individualism, and self-interest. They taught altruism, collectivism, and self-sacrifice. They ran relentless campaigns that dehumanized non-compliant individuals.
Ultimately, not a single trait of human nature had changed. In the months before the collapse, the indisputable failure of collective farming forced the Soviet communists to resurrect the idea of individual farms -- and, in order to survive, Chinese communists reverted to private entrepreneurship, while maintaining the pretense of Marxist orthodoxy.
This alone should be enough to discredit the fundamental Marxist doctrine that the human mind is a "social construct" shaped entirely by manipulation and social conditioning. As an unintended consequence, the Soviet experiment proved the existence of something that Marxist science has always denied: that our individual thoughts, motives, and actions are governed, on the most part, by absolute moral standards, which are objectively derived from the unchangeable nature of human beings and the nature of the world.
Obviously, it is more beneficial to accept human nature in its entirety as an absolute standard and to build the society on that foundation, rather than to erect an artificial construct first and rearrange the foundation later, trying to discard parts that don't fit into the design.
And yet that failed philosophy is now flourishing in America's academia and leftist think tanks, which currently formulate U.S. government policies.
From the economy to crime prevention to education to foreign relations, America's policies today are based on the Marxist premise that crime results from poverty, economic crisis results from greed, injustice results from capitalist exploitation, corruption results from the free markets, and militant Islamism results from Western colonialism. Therefore, peace and harmony can only be achieved through equal redistribution of wealth, appeasement, and a global effort to reshape human nature through politically correct, collectivist indoctrination.
Predictably, a faulty premise leads to a faulty outcome: the economy is stumbling, education is failing, corruption is spreading, crime is rising, and militant Islamism is gaining more ground. Instead of creating the New Man, the suppression and demonization of natural human traits breeds moral and intellectual freaks. Where normalcy is outlawed, abnormalities flourish.
The most damaging outcome of this fallacy, however, is also the least visible -- and thus rarely mentioned: the government effort to demonize our individual thoughts, impulses, and human nature itself can only result in the eventual dehumanization of our society, turning independent American citizens into mindless statistical units, spiritless cogs in the machine, and powerless subjects of the state, ripe for abuse by any sociopathic government official with dictatorial tendencies.
The Game can only exist in symbiosis with big government. They equally need each other for survival, nourishment, and expansion. Downsizing the government would not only deprive the Game of its nourishment, but would remove the very reason for its existence. Of course, the Game's state sponsor can also be a foreign government -- as it was with the network of KGB influence agents -- but that is a matter for another discussion.
A free-market revolution's primary function, therefore, would be to discard any policies or government structures that are based on the collectivist philosophy of demonization and dehumanization of the individual, starting with the Department of Education.
Human nature has taken us this far; there is every reason to believe it will continue to help us in the future.
Obama won't allow the best hospitals to expand
The Obama administration says it's identified hospitals that provide patients with the most value under a new ObamaCare bonus program. Unfortunately, the sweeping health law also makes it very hard for such facilities to expand or new ones to be built.
The law's Hospital Value Based Purchasing program rewards hospitals that meet certain quality standards with a small percentage increase in their Medicare payments. Those that fall short face small Medicare payment percentage cuts.
The standards include "process measures," such as the percent of patients receiving an antibiotic within an hour of surgery, and patient satisfaction measures, including how well a doctor communicates with a patient.
Nine of the top 10 hospitals in the first round of HVBP were physician-owned. Indeed, doctor-owned hospitals accounted for 48 of the 100 top spots, according to data from the Centers for Medicare and Medicaid Services. Over 3,400 hospitals were included in the program.
Treasure Valley Hospital got the top bonus, a 0.83% increase in its Medicare payments. The Boise, Idaho, physician-owned hospital offers an array of surgical services.
Most physician-owned hospitals tend to specialize in one field, such as cardiac or orthopedic surgery.
Physician-owned hospitals did so well because they "have more focus on patients and patient care. They put more money at the bedside," said Paul Kerens, president of Physician Hospitals of America. "Unlike major hospitals, we don't have as many bureaucratic layers to go through to get quality to the patient bedside."
Nancy Foster, vice-president for safety and patient quality at the American Hospital Association, said, "The measures are dominated by heart care and orthopedic care, which is where physician-owned hospitals are likely to excel. Additionally, hospitals that are new and smaller do better on the (patient satisfaction) measures and those differences make it more challenging for general, acute-care hospitals to score well."
While ObamaCare highlights and rewards physician-owned hospitals for their high patient value, the law also effectively bars any more from ever being built. Provisions withhold Medicare funds from any physician-owned hospital built after 2010.
That was a big victory for traditional hospitals, which claim their physician-owned rivals don't take as many low-paying Medicaid patients and thus are unfair competition. For years the AHA and the Federation of American Hospitals lobbied Congress to stop the expansion of physician-owned hospitals.
ObamaCare also put regulatory hurdles in the way of existing physician-owned hospitals that want to expand. The owners must first apply to the federal Department of Health and Human Services. They can do so only once every two years.
They must then wait while members of the community provide input. Further, the physician-owned hospital must be in a county where population growth is 150% of the overall state's growth in the last five years. Inpatient admissions to the physician-owned hospital must be equal to or greater than the average of such admissions in all hospitals located in the county. Its bed occupancy rate must be greater than the state average. And it must be located in a state where hospital bed capacity is less than the national average.
Even if the physician-owned hospital meets all of those conditions, it is prohibited from expanding more than 200%.
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