Wednesday, June 27, 2012

The Anatomy of Failed Legislation

Why do so many congressional bills become failures? There are many reasons that are outlined in this writing.

First, there is too much special interest influence. This is one of the reasons that bills are so long, complicated, complex, and convoluted and therefore, they fail to meet their intended objectives and goals. For instance, the goal of the American Recovery Act (the 862 billion dollar stimulus) was to create jobs and it failed miserably. The goal of the healthcare reform legislation (ObamaCare) is to reduce the cost of healthcare, but it too will fail. The Recovery Act was riddled with pork and special interest projects and it therefore, neglected to create jobs. The same can be said about ObamaCare, lobbyist from unions, big pharmaceutical companies, trial lawyers, hospitals, doctors, AARP, and so forth made no sacrifices to lower healthcare costs. In fact, most of the burden of reducing healthcare costs relies solely on the insurance companies and that is not enough to lower healthcare costs. Let’s face facts; as long as lobbying remains legal, there is a potential for fraud and corruption when writing legislation.

Major legislation is much too long and confusing. In fact, most politicians fail to read and understand their own legislation. Thus, they have absolutely no idea how it will work in reality. Each provision in a bill can be interpreted differently because they are written by lawyers in very general terms. Thus, provisions in a bill can be implemented in a manner completely different than how the author of the provision intended. For this reason, it would make sense to not only simplify legislation, but to try it on a smaller scale. For instance, ObamaCare could be tried in a few select states to see how it works before implementing it nationally. And what is worse, is that politicians routinely piggy back non related legislation onto bills. For example, a government takeover of the student loan business was added to the ObamaCare legislation.

The Congressional Budget Office (CBO) cost estimates for bills are generally not only incorrect; they miss the mark by large margins. First of all, the CBO provides precise estimates with absolutely no accuracy to take into account potentially worse case scenarios. All entitlement legislation such as Medicare, Social Security, Medicaid, welfare, and Food Stamps, has missed cost projections by 10 or 100 times. There are a few reasons for the CBO’s abysmal projection performance. For one, the CBO does not consider the effect of the legislation on variables. In other words, they assume all variables will remain static after a bill passes. For instance, in ObamaCare, the CBO fails to consider that employers may opt to drop employee healthcare plans and instead pay fines. This may force millions into the ObamaCare program they did not anticipate. Secondly, the CBO and legislators lack any strategic vision. For instance, when computing entitlement costs they failed to consider how much the life expectancy of Americans will increase over time. Did the CBO or legislators consider that over 40% of all doctors are over 55 years old when writing or computing the impact of ObamaCare? This means in 10 years there will be over 40 million more people in the healthcare system with 40% fewer doctors. Likewise, did the CBO and legislators consider the impact of ObamaCare if 15 million illegal immigrants are given amnesty? No, there is absolutely no strategic vision when writing legislation or computing the impact of legislation.

Politicians are more likely to make legislative decisions based on ideology than on logic or commonsense. For instance, the recent Disclosure Act was supposedly written to provide transparency into campaign contributions. But in essence, the law was written in a way to give liberals an unfair advantage in future elections. The recent financial reform legislation was written to regulate Wall Street, but it conveniently omits liberal government financial agencies (Fannie Mae and Freddie Mac) from any oversight and regulation.

Legislation often fails to be applied consistently across all populations, corporations, and organizations. In other words, there are exceptions to every law, which not only makes it unfair, but harder to enforce since it is going to face constant legal scrutiny. ObamaCare, for instance, gave special deals and carve outs to Nebraska, Louisiana, and Florida residents. The Disclosure Act gives unions an exemption from disclosing campaign contributions.

And finally, many new laws and entitlements are paid for using fiscally irresponsible methods. For example, my generation is currently funding those people who are currently on Medicare and Social Security. When I retire, the working class will pay for my social security and Medicare. In other words, these programs operate using a Ponzi scheme similar to one the Bernie Madoff used. As with the Bernie Madoff scheme, the money will run out as more and more baby boomers head into retirement.

My Book: Is America Dying? (, Barnes and Noble)


  1. You bring up a lot of good points, Patrick, but when it comes to legislation introduced by those on the Left I think there is a key element that must be understood. You said:

    >>”the goal of the American Recovery Act (the 862 billion dollar stimulus) was to create jobs and it failed miserably.”

    I would disagree that the goal was to create jobs. Regardless of what the stated goal was, I think the real intention of the Recovery Act was to expand government, advance the Left’s agenda, reward the democrat base (unions) and transfer wealth – all on the taxpayer’s dime. The proof of that is evident in the selection of programs targeted in the bill. So from the Left’s perspective, it was a success.

    We can’t and shouldn’t underestimate this fact when evaluating legislation and the actions of the Left. When the stated purpose of a law is overshadowed by ulterior motives that conflict with the original intent, the intent is effectively changed or altogether nullified. I think we kid ourselves when we play along with the lie that the stated objective was the real objective.

    Same for Obamacare. It was sold based on the stated objective of reducing healthcare costs, but the real objective was always to get free healthcare for “the poor” (there’s your wealth transfer), expand the gov’ts role in healthcare and increase entitlement dependency. Everyone knows those goals are counterproductive to reducing costs, so I think it would be fair to say that reducing costs was never a sincere objective of Obamacare.

  2. CW, I agree, probably another poor choice of words on my count. I have written in the past how the Stimulus was used to push Obama's green energy agenda, education agenda (Race to the Top), etc. I completely understand your point. The goal of the stimulus should have been to create jobs and for healthcare to reduce costs, but when the left is involved there is always another agenda.