States Reject Insurance Exchanges. Who’s Next?

by Christina Sandefur, Goldwater Institute

As last week’s so-called “deadline” for states to decide whether or not to establish a “health insurance exchange” came and went, Arizonans were given good news: Governor Jan Brewer will not stick Arizona taxpayers with the bill for implementing the new federal health insurance mandates – for now. The Governor has decided to delay her decision as she continues to study Arizona’s options.

Early on, some state policymakers were misled into thinking that setting up a state exchange would give them flexibility from federal control. There’s also been discussion of urgent “deadlines” states must meet to “comply” with the federal law.

Federal bureaucrats, ill equipped to execute a comprehensive takeover of the nation’s health insurance industry, have been hoping governors and legislatures would buy these stories.

What the feds don’t want states to know is that federal law does not require states to establish exchanges. In fact, there’s no rush to make a decision – states may opt in at any time. If states choose not to set up an exchange, the federal government will have to create and fund one on its own.

Fortunately, governors across the country are finally learning the truth about insurance exchanges.


Why do we keep giving the federal government our money?

“People have been brainwashed. People have been told that you need this income tax system to fund government, which is absolutely ridiculous. My question is that if that is true, then how did we fund government from 1776 to 1913.” – Peter Gibbons, Tax Attorney.

I can’t even count the number of false arguments I have heard to defend the federal governments collection of federal income tax.  Among them….

“Who’s going to pay for the highway system?”

“What about our public schools?”

“We have to support our military!”

“What about traffic lights and stop signs, and street signs”

Let’s just pretend for a minute that all of these are constitutional programs that the federal government has the authority to fund.  Doing some research I found that…

Schools are paid for by property tax.

Highways are paid for by gasoline tax.

Military is paid for by corporate tax.

Sales taxes pay for an array of local needs, including traffic signals.

Incidentally, the program that most conservatives critique, the federal welfare program, is paid for by Social Security tax.  One unconstitutional program, paying for another.

Let’s examine history for a moment and find out why our federal income tax is so high, and how it became so out of control.


Courting Nullification

Ed “NJWeedman” Forchion hopes the Oct.18, 2012 not-guilty verdict a Burlington County, N.J.  jury rendered in his pot distribution trial plants a seed for other medical marijuana patients and sparks a change in the law.

“I expected to get one juror, but I got 12.”

It was a case of jury nullification, which Forchion hopes will be utilized in other court cases involving marijuana possession.

Forchion is the first defendant in New Jersey to be allowed to present his use of medical marijuana as a defense in a criminal trial. He possessed a pound of marijuana that he claimed he used for medicinal purposes. (He owns a medical marijuana dispensary in California.) He admitted that he will still face sentencing in January 2013 for possession, but believes that he will get probation on that charge.

The concept of jury nullification is nothing new. In the 1735 trial of John Peter Zenger, who was charged with printing libelous material about William Cosby, the Governor of the Colony of New York, a clearly guilty Zenger was found not guilty by a jury who sympathized with him. This is clearly a case where jury nullification foreshadowed present-day law where one can openly say something about a public figure without fear of prosecution because said figure was “offended.”


South Dakota will not be Creating a State Health Exchange

Gov. Dennis Daugaard said that South Dakota will not be creating a state health insurance exchange.  This comes amidst several other governors following suit.

Gov. Daugaard said that “After extensive research and analysis, it has become very apparent that operating our own exchange will simply not work for South Dakota.”  Daugaard also said he opposes the federal law, “Because it is a large expansion of government that does little about the rising cost of health care.”

While this is not a full nullification of the Affordable Care Act, it’s a start.  The law only appropriates funds for the exchanges if it is created by the state.  If enough refuse, it will put much pressure on the federal government.   This may cause the unconstitutional federal mandate to become unsustainable.

Gov. Daugaard continued by saying he will not be increasing fees, or taxes to fund the exchanges.

“The federal law requires exchanges to be self-sustaining by 2015, which means we would either have to charge a fee to South Dakota citizens using the exchange, or increase taxes, neither of which I am willing to do.”


Andrew Cuomo, Get a Clue!

Gov. Andrew Cuomo is requesting $30 billion in federal aid to rebuild after Superstorm Sandy, which heavily damaged parts of New York City and Long Island.

“The administration will seek a supplemental appropriation to cover infrastructure, repair and emergency costs beyond those normally covered by federal emergency aid.”

Cuomo  added…

“I’ve asked for 100 percent reimbursement, The equity and the fairness is inarguable in this case, It will probably be a regional plan including New Jersey and Connecticut, with money for infrastructure, housing, local governments and small business.”

Generally, the Federal Emergency Management Agency (FEMA) will reimburse up to 75 percent of public costs, with the state and local authorities covering the remaining 25 percent. There have been cases, such as Hurricane Katrina, where the federal government has reimbursed up to 90 percent of costs.

DEAR GOVERNOR, you should dry the water from behind your ears, wipe the milk from your mouth and realize you are playing big boy games now, the kind your dad used to play. And your motives are as transparent as his were.  You’re apparently trying to set a precedent, not only for your state, but all of the other states, to rely completely on the federal government to solve all of their problems.


Why I’ve become a foreign policy non-interventionist

Over the last few of weeks, a couple of people have asked me why I’ve turned into such a foreign policy non-interventionist. Or as one friend put it, “What turned you into such a bleeding-heart?”

To put the question into context, I was once quite the hawk. I supported the first Gulf War to “liberate Kuwait,” I urged on the invasion of Afghanistan after 9/11, and I stood behind G.W. Bush’s invasion of Iraq. And I’m not going to lie, I still love military hardware, I respect the toughness and dedication of our warriors, and I am awed by projections of force.

But over the last few years, I’ve struggled to develop a cohesive political philosophy that also encompasses my faith in Christ. And I’ve realized, at times, my previous “conservative” political viewpoints contradicted the tenants of my faith, even occasionally contradicting each other.

After a great deal of reading and thought, I’ve settled upon the non-aggression principle to guide my political philosophy. Simply put, I find the use of coercive force in a non-defensive context morally objectionable.  This principle provides a moral constant against which I can evaluate both domestic and foreign policy.

With that in mind, it becomes clear why I can no longer support U.S. inverventionalist foreign policy.


States are Rejecting Exchanges, 4 more states looking to Nullify. And more. Tenther News: 11-19-12

This week’s episode is made possible in part by the new book, Our Last Hope. The status quo has failed you – voting the bums out is a failure as a strategy. This book offers a new path – one that is already winning. Get it online at

States around the country are refusing to implement Health Exchanges as mandated under Obamacare, the so-called Affordable Care Act. Rick Perry has said Texas will not implement. So has Governors Haley in South Carolina, Parnell in Alaska, Deal, Kasich in Ohio – and others.

Maine’s Governor Paul LePage took what appears to be the strongest stand in opposition when he sent a letter that said, “Because the guidance issued in the August 13, 2012 request of the U.S. Department of Health and Human Services (HHS) is not legally binding, the State of Maine will not be submitting a Declaration Letter. Instead, this letter serves as the state’s position regarding this issue. Since the ACA was signed into law, the State of Maine, along with several other states, has repeated on a number of occasions and we continue to believe that the law has severe legal problems, is bad policy, and overreaches into the lives and pocketbooks of fellow Americans.”

Some Obamacare opponents still wonder what these steps will actually achieve. While refusing to create an exchange won’t eliminate the Act, it will certainly create heavy logistical and financial difficulties for the federal government. The idea behind the refusal is simple: If the federal government had the resources and the manpower to do all this on its own, it wouldn’t have attempted to mandate the states into covering such massive costs. When enough states refuse to comply, the theory goes, it’ll create a burden that could cause the feds to reconsider, as it has done repeatedly since 2008 over the Bush-Era Real ID act.

At very least, even if not successful in bringing down the Affordable Care Act, resisting implementation at every turn possible holds the high moral ground. As Governor LePage seems to be indicating as well when he said, “Maine will not be complicit in the degradation of our nation’s health care system.”

But make no doubt about it, while this is a good first step, it is only a first step. As Tenth Amendment Center communications director, Mike Maharrey, put it, “Hopefully, mass refusal will not only gum up the system, but set the stage for more aggressive efforts to block this unconstitutional and economically untenable act.”

For information on how to deal with the next step, you can download the TAC’s FREE 18-page organizer’s toolkit at

In other news, Joel Poindexter reports that in the wake of two states – Washington and Colorado – flat out defying the federal government’s war on weed by fully legalizing the plant, more states will be considering legislation to do the same in 2013.


Where Do Rights Come From?

A reader writes: “My non-religious Libertarian friends completely disagree with my view that we are endowed with unalienable rights by our Creator. That being said, do you agree with that? (Right to be free, right to live) and if so, how can I defend my position to someone who feels rights can only come from a state?”

If your friends don’t believe in a Creator, then of course they aren’t going to believe that rights are bestowed by a Creator. That gap is unbridgeable as long as one of you is a religious believer and the other is not.

But I don’t understand why your friends think the only remaining option is that rights come from a state. There are other options, too: (1) there is no such thing as rights; and (2) rights exist, but are not divinely bestowed. They would be odd libertarians indeed to think people have no rights until a group of people wearing funny hats declare that they do, especially given that your friends would now need to explain how, if there is no such thing as rights prior to the state, these people get the right to establish a state and start barking out commands in the first place.


Governor Mary Fallin: No Health Exchange for Oklahoma

Today, Oklahoma Governor Mary Fallin sent a letter to HHS Secretary Sebelius indicating that the Sooner State will not create a state insurance exchange under the Patient Protection and Affordable Care Act. She wrote, in part:

“After careful consideration, I have today informed U.S. Secretary of Health Kathleen Sebelius that Oklahoma will not pursue the creation of its own health insurance exchange. Any exchange that is PPACA compliant will necessarily be ‘state-run’ in name only and would require Oklahoma resources, staff and tax dollars to implement. It does not benefit Oklahoma taxpayers to actively support and fund a new government program that will ultimately be under the control of the federal government, that is opposed by a clear majority of Oklahomans, and that will further the implementation of a law that threatens to erode both the quality of American health care and the fiscal stability of the nation.”

“Despite my ongoing opposition to the federal health care law, the state of Oklahoma is legally obligated to either build an exchange that is PPACA compliant and approved by the Obama Administration, or to default to an exchange run by the federal government. This choice has been forced on the people of Oklahoma by the Obama Administration in spite of the fact that voters have overwhelmingly expressed their opposition to the federal health care law through their support of State Question 756, a constitutional amendment prohibiting the implementation of key components of PPACA.”

Tenth Amendment Center communications director Mike Maharrey noted that refusing to implement exchanges in multiple states is a positive first step. “The feds depend on state cooperation to make these huge programs work. If a large number of states refuse to set these exchanges up, it puts and increasing burden on the federal bureaucracy, one I’m not convinced they are really prepared to deal with. Hopefully, it will lead to more aggressive action to block implementation down the road,” Maharrey said.

Maharrey noted that Fallin’s statement included something that other governors have been leaving out of their rejection letters to Sebelius, their state constitution.