January 26, 2025
A Whirlwind Policy Start to the Year
Before everyone recovered from their inaugural hangovers, Indiana’s new administration and legislature got to work with a number of policy items that should be met with bipartisan approval.
That does not mean everyone will embrace every development. But I do think most Hoosiers will either appreciate the changes, or we will learn something about ourselves in the process.
I begin with government reorganization. An observer of Gov. Mike Braun’s campaign should have real doubts about his organizational abilities. This was particularly true of the proposed property tax plan, which was clearly not discussed with anyone in possession of a clue about taxation.
In contrast, the Braun administration’s proposals after the election should inspire confidence.
The first big step is a proposal to reorganize state government under eight functional cabinet posts. This plan would organize several dozen agencies under a single leader responsible for a broad area, like management and budget or public safety.
No doubt this plan will face some legislative scrutiny. For example, I don’t see a clear reason why the Hoosier Lottery reports to the secretary of commerce, but I am certain there are reasons. Moreover, few honest observers would see much to quibble with in this plan.
To be fair, state government has long been loosely organized this way, but this plan formalizes the arrangements. After all, state government employs about 110,000 people, and clear organizational structure makes sense. No matter how one views their policy positions, the Braun administration is hiring experienced, competent people to fill those cabinet and agency heads.
In his first week in office, Braun signed several executive orders that should be widely appreciated. The first of these created the cabinet positions. He pushed to cut occupational licensing restrictions (see https://www.in.gov/gov/files/EO-25-18.pdf), eliminate degree requirements for state jobs (see https://www.in.gov/gov/files/EO-25-15.pdf) and institute a broad review of state regulations (see https://www.in.gov/gov/files/EO-25-17.pdf).
While Indiana is among the least restrictive states on occupational licenses, there remain many that impose restrictions on entrepreneurs and consumers without benefits. This executive order will prompt a review and reduce many of these barriers to workers doing jobs they are able to do. Among the many examples, Indiana is among eight states requiring a septic tank cleaner license (see https://csorwvu.com/indiana-snapshot/). That stinks, and this executive order should help.
Degree requirements for jobs are equally unwise, and several states have already taken the step of outlawing arbitrary credential requirements. In those places—Maryland in particular—the result was no statistically discernable change in the mix of people with degrees working in state government. So, it is very unlikely to have that effect here, but opening the door to more people is nearly always a constructive move.
Third, Braun’s executive order requiring a regulatory review is welcome. This could include new benefit-cost analysis, and comparison with surrounding states. While this imposes short-term costs on state agencies, it is likely to uncover rules that can be eliminated or modified because their benefits are well below their costs.
Braun also eliminated public funding on diversity, equity and inclusion programs funded by the state (see https://www.in.gov/gov/files/EO-25-14.pdf). Citing the Equal Protection Clause (see https://constitution.congress.gov/constitution/amendment-14/) and Students v. Harvard (see https://www.oyez.org/cases/2022/20-1199), this executive order should be welcomed by every Hoosier.
This order ends a broad range of activities that were deemed unconstitutional last year and closes the state’s DEI office. Now, no agency can maintain an office that grants preferential treatment based upon race, color, ethnicity or national origin. No employee can be required to attend any training that endorses such preferential treatment, nor can an employee be forced to write a DEI statement as part of a job application program.
The executive order also ensures that no one can be mandated to disclose their pronouns. That issue is a clear First Amendment issue, settled in 1943 (see https://www.thefire.org/research-learn/pronouns-free-speech-and-first-amendment#:~:text=Any%20policy%20compelling%20the%20use,especially%20pernicious%20abuse%20of%20power). More likely this was included to appease those Hoosiers who want to read something about pronouns, without bothering to understand it. Though, to be fair, parts of the First Amendment—like the establishment clause—might pose certain challenges over the coming years.
I am aware that many Hoosiers feel that the promise of equality that animates our Constitution remains unfulfilled. I share that view, and suspect most Americans do as well. I trust we’ll continue to work for a more perfect union. But, as Students v. Harvard made abundantly clear, current DEI programs and policies have morphed into a counterproductive set of practices.
They are also unconstitutional. It is past time for them to go.
Taken together, these executive orders streamline government, offer the opportunity to cut waste, allow more worker freedom in Hoosier labor markets and eliminate the contentious, unhelpful and unconstitutional activities within the state government DEI programs. It is a good start to a term that will wrestle with many more difficult challenges.
The legislature has been just as busy as the governor, but their leading legislative proposals are likely to face stiffer backlash than Braun’s executive orders.
Among my favorite is House Bill 1004, which would strip nonprofit protections from large multi-location hospital chains that overcharge for services. State Reps. Martin Carbaugh, Julie McGuire and Ben Smaltz authored this bill, which is long overdue. It makes the rather sensible observation that if nonprofit hospitals are going to behave like for-profit firms, then they should be treated as such.
The beauty of this legislation is that it offers hospitals a choice—behave like you are concerned about the health of patients and your community, or be treated like any other business. Among other things, the removal of nonprofit status would allow them to be taxed on property, sales and profits. Indiana’s big five hospital systems are the most profitable industry in the state, and they own an astonishing amount of property. This could be a windfall for Hoosier taxpayers.
The end of nonprofit status would also end their noncompete clauses, which they currently wield skillfully to prevent competition from other hospitals. It would also expedite antitrust enforcement by the Federal Trade Commission and Department of Justice.
This law would be a huge victory for Hoosier businesses, Hoosier consumers, and state and local governments.
House Speaker Todd Huston has also created the Indiana-Illinois Boundary Adjustment Commission, which would be tasked with exploring ways to entice several Illinois counties that have voted to secede from the state to join Indiana. This is first-rate trolling, and I look forward to reading the commission minutes.
I also look forward to writing more about the legislature’s valiant efforts to return sanity to the state’s health care markets, and what the benefits—and costs—of absorbing disaffected Illinois counties might be.
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The views expressed here are solely those of the author, and do not represent those of funders, associations, any entity of Ball State University, or its governing body.
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