9) Health Care Briefing Paper #4: Problems with a Single Payer Health System: Reassessing GAO's Study of Canadian Health Care (Released by Rep. Dick Armey, January 1991).

According to the General Accounting Office, enacting a Canadian-style health care system will save Americans $3 billion per year, but the GAO study is replete with factual and methodological flaws. A national health insurance program could end up costing U.S. taxpayers $81.5 billion per year. This study provides an in-depth look at the costs associated of such a government monopoly on health insurance.

10) The Cost of Health Insurance Administration (Testimony by Gordon R. Trapnell of the Actuarial Research Corporation before the JEC on October 16, 1991).

In his testimony, Gordon Trapnell discusses the estimated $28 billion Americans spent to administer health insurance in 1991 and examines the specific functions of this administrative spending. Trapnell then explores the impact of insurers' turnover on the level of expense. Components of cost directly associated with turnover include commissions, bonuses, sales support, underwriting, and issue expense. Finally, he considers the implications for national policy and suggests that the most productive solutions would be those that change the fundamental incentives of the insurance business.

11) Alternatives for Reform of the American Health Care Delivery System: A Small Business Perspective (Testimony by William Dennis, Jr. of the National Federation of Independent Business Foundation before the JEC on October 2, 1991).

William Dennis offers his observations on small business and health care, noting that many small businesses choose not to offer health insurance. Mr. Dennis says cost is the primary cause for non-provision of health insurance. Factors such as industry exclusions, new business waiting periods, expected future cost increases, high employee turnover, and employee preference for wages also influence coverage decisions. After discussing the pitfalls of the "pay or play" and "simple mandate" systems, Mr. Dennis says Americans are left with two choices for health care: a state-driven model or a consumer-driven model. He examines both in length, but in his final analysis concludes it will take "imagination to resolve the thousands of glitches, inconsistencies, and special circumstances that arise daily." "That is far more likely to happen in a consumerdriven health care model...than it is in a bureaucracy-driven model where a handful of people make decisions for millions of others."

12) Legislative Proposals for Health Care Reform (Testimony by Lee Tooman of the Golden Rule Insurance Company before the JEC on October 30, 1991).

Lee Tooman discusses a model law, developed by the Golden Rule Insurance Company and the Heritage Foundation, which brings several reforms to health insurance. Tooman says the thrust of the model allows people to stay in the insurance system and generates virtually no additional incremental costs to society. After discussing what he considers the misconceived problems facing the market today, he identifies the real problems in his opinion: stability in premiums and renewal practices; access to health insurance; portability of health insurance; and affordability. Finally, Tooman proposes the model's solutions to each.

13) Health Care Reform and the Canadian System (Testimony by Donald T. Lewers of the American Medical Association before the JEC on October 16, 1991).

Donald Lewers' testimony concerns the cost differences between the U.S. and Canadian health care systems and the goals of the American Medical Association for improving American health care. He refutes those who sing the praises of the Canadian system and says the American people would not accept the choices Canada has made. Mr. Lewers argues that administrative savings from adopting the Canadian system in the United States are highly overestimated and reveals that the system imposes intangible costs on patients and providers. He examines leaving intact the competitive system of health care delivery by seeking administrative savings through insurance market reform and claims administration reform instead.

LEGISLATIVE ANALYSIS

14) An Analysis of S. 5/H.R. 2: The Family and Medical Leave Act of 1991 and Its Impact on Poor Working Families (Released by Rep. Dick Armey and Sen. Bob Smith, June 1991).

The Family and Medical Leave Act of 1991 (S. 5/H.R. 2) would not help poor working families, women, and low skilled workers. This study concludes that if Congress enacts parental leave legislation, low skilled workers are likely to be phased out of the production process as employers shift to more capital-intensive processes, and that the burden of this legislation will be borne by those least likely to afford it.

15) Expanding Unemployment is No Benefit: An Economic Analysis of Proposed Changes in the Federal Unemployment Tax System (Released by Rep. Dick Armey and Sen. Bob Kasten, Senate Small Business Committee Ranking Republican, September 1991).

This study looks at the impact of increasing taxes to fund an emergency extension of unemployment benefits. It finds that the proposed financing changes contained in H.R. 2839 would increase the tax on jobs paying above $14,000 per year and eliminate 100,482 American jobs in 1993, an average of 231 jobs per congressional district. Firms of all sizes would face increased labor costs, and small business would be especially hurt because they are more sensitive to incremental labor cost increases than their larger counterparts. It further concludes that just as higher labor costs increase unemployment, they also create other dynamic effects throughout the economy, such as reduced output and increased Federal spending on income support programs.

16) Measuring HR 3201's Impact on Individual States and Unemployment Duration (Released by Rep. Dick Armey, September 1991).

This critical analysis of H.R. 3201, the Emergency Unemployment Compensation Act of 1991, finds that Congress has created provisions in unemployment law that will reward workers in states with relatively low-wage, low-skilled labor forces at a time when America's economic competitiveness is in jeopardy. This law will also violate the pay-as-you-go provisions of the 1990 budget agreement, as well as create additional unemployment since economic data strongly suggest a correlation between the duration of benefits (being increased up to 12 weeks) and the average duration of unemployment.

ECONOMICS

17) Distorting the Data Base: CBO and the Politics of Income Redistribution (Released by Rep. Dick Armey, April 1991).

Congress relies heavily on Congressional Budget Office (CBO) family income data when considering legislation on domestic policy, but CBO's methodology in the measuring of capital gains, a major component of family income, is flawed. CBO wrongly combines nominal capital gains with other components of income that have been adjusted for inflation; fully includes all net capital gains in nominal income but excludes net capital losses over $3,000; and counts capital gains that accrue mostly in the upper brackets but not those that accrue mostly in middle and lower brackets.

18) The U.S. Economy: Open Society or Caste System? (Released by Rep. Dick Armey, January 1992).

The use of misleading family income data allegedly showing that the rich are getting richer at the expense of the poor, presumably as a result of the tax policies of the 1980s, is a popular pastime with those interested in fomenting class warfare. This study refutes that idea by analyzing Census Bureau data and demonstrating the remarkable degree of upward and downward income mobility in our economy. It concludes that failing to take into account the constantly changing mix of individuals and families who make up quintiles not only contains serious mismeasurement problems, it also systematically distorts the dynamic nature of our economy.

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19) Rural Development and Telecommunications (Testimony of Phillip Mink, Citizens for a Sound Economy, before the JEC on May 22, 1991).

Mr. Mink states that improving telecommunications networks in rural areas will benefit all of America by fostering economic growth. Citizens for a Sound Economy advocates certain policy changes that are not in line with those advocated in the Office of Technology Assessment's report "Rural America at the Crossroads: Networking for the Future." CSE notes that due to anticompetitive policies in a highly regulated communications industry, mutual development in the computer and communications industries is not occurring. CSE advocates the following policy changes: lift the ban placed on the seven regional Bell companies that prohibits them from manufacturing telecommunications equipment; change the 1984 Cable Act which prevents telephone companies from providing service to their telephone service areas; and allow accelerated depreciation schedules for all telephone companies. In conclusion, by making the policy changes suggested, competition will flourish and the private sector will be able to determine how to meet rural America's telecommunication needs.

20) Presidents and Economic Performance: An Analysis by Fiscal Years (Released by Rep. Dick Armey and Sen. Connie Mack, November 1991).

This study debunks the emerging myth that the late 1970s were better in terms of economic growth and job creation than were the mid to late 1980s. The author emphasizes that one should not measure a president's economic performance by calendar year but should focus on the fiscal year. This evidence clearly shows that the Reagan years yielded lower inflation, lower unemployment, and higher real economic growth than the years under Jimmy Carter.

21) A Marshall Plan for America (Testimony of James C. Miller, III, Citizens for a Sound Economy, before the JEC on January 13, 1992).

Mr. Miller, the former director of the Office of Management and the Budget under President Reagan, answers calls for "governmental intervention" in the economy by setting up parameters where the economy can flourish on its own. He cautions that the government should not try to "fine tune" the economy, but that it should take action to eliminate economic dead weight. He calls for cutting the capital gains tax to zero, reducing tax rates to where they were before last year's budget accord, freezing government spending in nominal terms, and establishing a moratorium on new regulation. Mr. Miller concludes by urging Congress to adopt the economic parameters he has suggested and warns that more short-term fiscal maneuvering, as stressed in the "Marshall Plan for America," could well make economic matters worse.

SOCIAL POLICY

22) Rethinking Welfare Policy (Testimony of Stuart M. Butler at The Heritage Foundation before the JEC on November 19, 1991).

Mr. Butler begins by noting that heavy government spending has appeared to reinforce or actually cause trends that have led to a "culture of poverty." Mr. Butler continues by urging state and Federal governments to think more clearly about work requirements and training, urges lawmakers to gain an understanding of the incentive system, emphasizes that the Federal government must recognize the importance of empowerment, and asks the Federal government to expand the waiver process to allow states to try new approaches to the welfare problem. Mr. Butler concludes by stating there must be vigorous scientific evaluation and controlled experiments. Congress should design detailed strategies that relate to real conditions, and new Federal rules should give states the widest possible latitude to embark on radical reform.

23) The War on Poverty: What Worked? (Testimony of Walter E. Williams of George Mason University before the JEC on September 25, 1991).

Professor Walter Williams charges that any sensible discussion of poverty should include alternative definitions of poverty. Only then does he say that society can work to eliminate poverty. He also criticizes the Census Bureau for the way the agency measures poverty. He says that Americans have eliminated most aspects of material poverty as traditionally defined, yet are left with those that are "permanently dependent" and who have "poverty of the spirit." While the Federal government has played a large role, it has been anything but good. He cites numerous examples including the public housing situation, the socialized agriculture market, and the minimum wage laws. He says that those who want to help wrongly want to redistribute income. In his estimation, income is earned, not distributed, and Congress hinders greater efforts to earn.

24) Poverty in the United States (Testimony of Lawrence M. Mead of New York University before the JEC on July 25, 1991).

In his statement, Dr. Mead says that poor adults working at much lower levels than the nonpoor explains poverty among most families and children. He argues that barriers such as low wages, lack of jobs, and racial bias explain this inequality among workers better than a failure to work. Moreover, he says that nonwork is due mostly to demoralization. In his estimation, requirements that welfare recipients work as a condition of support have proven more effective than policies that promote work by raising skills or wages.