Filed under: Domestic Policy, Economy, Health Care, Liberalism, Democrat Corruption, Capitalism, Law, Statism | Tags: The Congressional Budget Office, The Affordable Care Act, Incentives Matter
The Congressional Budget Office says that ObamaCare will increase unemployment. There are 7.8 million Americans working part-time who want full-time work. Mr. Obama changed the subject to raising the minimum wage.
On Tuesday no less than the Congressional Budget Office reported that the health law is causing Americans to work less or not at all, in a remarkable intellectual turnabout for the budget shop that Democrats cited repeatedly when selling ObamaCare. Now CBO—full of liberal-leaning economists—says the economy will lose the equivalent of two million full-time workers by 2017 and 2.5 million over the next decade, a threefold increase over its prior estimate.
ObamaCare’s complex design includes new subsidies, new taxes and new mandates. For low wage, lower-skilled or discouraged workers ObamaCare offers incentives that can force them to trade jobs for entitlement benefits. The CBO concludes that ObamaCare will encourage people to supply less labor by working fewer hours to qualify for more benefits. The incentives suggest watching carefully the overtime, a promotion or training in hopes of higher future earnings — it might boost you into another category with less or no subsidy. The question becomes how many people can the nation support on entitlements? I thought the numbers were already too high.
The CBO’s job-loss prediction doe not include the impact of ObamaCare’s employer mandate, which requires businesses with 50 or more full-time employees to offer insurance or pay a $2,000 penalty for each worker beyond 30 employees. The mandate has been delayed by executive order for a year. so it won’t take effect till 2015, which probably means the CBO is vastly underestimating job losses.
The White House, of course, denies everything. “Claims that the Affordable Care Act hurts jobs are simply belied by the facts in the CBO report,” the White House, in the person of Jay Carney, declared. The White House seems to mean that the report is positive because”individuals will be empowered to make choices about their own lives and livelihoods” and “have the opportunity to pursue their dreams.” Didn’t Nancy Pelosi suggest that they would have more time to do art or crafts or maybe music?
Incentives matter. People respond to incentives. And there’s nothing in the act that encourages businesses to hire more workers and be more competitive. Like “if you like your doctor,” it may include “If you like your job…” The law is a job destroyer that is taking away rungs from the ladder of upward economic mobility.
Filed under: Capitalism, Democrat Corruption, Economy, Health Care, Liberalism, Politics | Tags: Economic Ignorance, Incentives Matter, Medical Device Tax
Another comment on changing times: In 2012 and in 2013, roughly $34 billion went into venture capital deals in the United States. The cities were what you would expect, Silicon Valley, Boston, Austin, Seattle, New York and Los Angeles. Innovation is fast and varied.
One sector that is seeing a rapid drop in investment is in healthcare and devices. ObamaCare has a big medical device tax buried in it, and money has pulled back from taking a risk in healthcare while ObamaCare gets sorted out. Once again, it is all about incentives. When you tax something, you will get less of it. What Obama is taxing is not “devices” — but innovation.
What this appears to relate to is a vague idea that insurance companies are greedy rip-offs, doctors get paid way too much and hospitals charge outrageous amounts for an aspirin — which seems to be the impetus behind ObamaCare. That is, a bunch of people, with no qualifications for the job, have devised regulations — the impact of which they do not understand — for a business, the workings of which they do not understand in the slightest.
Next time you are in a doctor’s office or in the hospital, assuming it’s routine, look around and count up the “devices,” from the stethoscope around the doctor’s neck, to the examination table, the sink, the thermometer and blood pressure monitor to the $1 million CT scanner or the $4 million radiation machine. Take a serious look at one of the Stryker hospital beds.
Consider the absurdity of developing a new government-run health care plan — because health care costs too much, (a health care plan that actually increases cost and decreases care), that increases the cost of everything used by the medical profession with a tax on each item — and then expects costs to go down in the future because of medical innovation.
Hospitals across the country are engaged in cutting costs wherever they can. This will have the inevitable effect of gradually diminishing quality and care. The incentives for the medical establishment become how to get adequately paid for their services. The incentive for the government is reducing costs in a system in which they have guaranteed a rising spiral of expense.
Filed under: Capitalism, Democrat Corruption, Domestic Policy, Economy, Energy, Health Care, Politics, Regulation, Taxes | Tags: Bad Economic Ideas, No Help For The Economy, State of The Union Speech
Democrats mostly don’t read Republican stuff, whether history, economics, or foreign policy. We are the enemy and our opinions and our writings are suspect. A liberal member of the family refused to read a piece I had extracted from the Wall Street Journal because he considered the Journal to be right-wing territory — even though only the Opinion page leans right and the news pages lean left. Anecdotal, of course, but typical of many on the left.
Do you suppose that many Democrats have watched the great videos of Milton Friedman explaining troublesome ideas like the minimum wage, or extending unemployment benefits. They just don’t. And they would reject it, not because it didn’t make sense, but because they were enemy ideas.
Republicans study issues to determine what works. Democrats cite studies that they believe will help them win. Republicans are looking for growth in the economy and successful strategies to get there. Democrats are looking for issues that will sway their voting groups, and testing potential language to see what words will be most effective.
Many studies over time have shown that increasing the minimum wage is an unemployment act for young people. Many states have minimum wage rates that are higher than the national minimum wage. It is meant as a starter wage for people just learning to work, not as a wage to support a family. The official poverty level for a one person household is $11,490. A full-time worker earning $7.25 an hour is above the poverty level. For a two-person household, the poverty level is $15,510, and two people earning the minimum wage would not qualify as being below the poverty level. In most cases, the person who earns the minimum wage belongs to a household where the family income is $50,000 or more. Most people who earn the minimum wage get an increase within a year. Most businesses that hire people at the minimum wage are finding it advantageous to replace workers with self-checkout aisles, and mechanization and robots will soon be replacing more. Then where do beginners learn how to work?
New research shows that extending unemployment benefits is a net economic drag. The liberal case for extension of benefits rests on the supposedly stimulative effect of greater disposable income for the unemployed. The new study conducted by economists at the University of Pennsylvania and the Federal Reserve Bank of New York contends that any such stimulus is dwarfed by the economic damage done by extending jobless benefits. People respond to incentives, and unemployment benefits reduce one’s incentive to look for a job. They allow some people to wallow in discouragement longer than they otherwise would, or encourage the recipients to wait for a better job.
The White House pays women less than it pays men.
Universal pre-kindergarten does not improve outcomes. There are modest positive effects during the preschool era, but they do not last even into kindergarten, much less through elementary years.
There is no evidence that Michelle Obama’s obesity initiatives for children have reduced obesity. Mostly, the kids won, because they hate the lunch menus.
Maybe some people spend a lot of time worrying about those who make more money than they do. It has always seemed to me that it is only a challenge to yourself. What matters is your own success at the things that matter to you. Some mothers take a part-time job so they can be home with their kids when they aren’t in school. When you retire, you and your company part company, They are through with you and concerned with current employees. When you ponder your accomplishments in your old age, it will have more to do with your family and friends than with what you did at work. I just don’t think people spend a lot of time envying those who make more money, though the federal government it insistent on encouraging envy.
Filed under: Capitalism, Domestic Policy, Economy, Election 2014, Foreign Policy, Freedom, Health Care, National Security, Regulation, Taxes, The United States | Tags: Big-Tent Conservatism, Free Markets / Free People, United We Stand
[American Elephant adds: While I wrote the paragraph quoted from our "About" page, I did not write this post and do not agree with the insulting characterization of the Tea Party.]
If you have ever clicked on the “ABOUT” line in the sidebar, it says :
American Elephants is the internet home of big-tent conservatism — black, white, brown, gay, straight, Christian, Jew or Hindu — it takes elephants of all persuasions, united, to beat back the liberal clowns and lead the circus of politics. So, ladies and gentlemen! Children of all ages! Step right up and come on in under the Big Top!
I have no story about my magical conversion from a youthful romance with the Democratic party, I have always been a Republican. In fact, I’m a 4th generation Republican, one of my great-grandfathers wrote around 1860 that he “was a quiet but interested member of the Republican Party.”
“Republican” is a term in current disfavor, Liberals have gone to great lengths to call us racist, bigots, mean, uncaring, racists, and now “conservative” is the preferred term. My party registration remains the same. The “Big Tent” part has lapsed into disfavor among many Republicans as the Tea Party people are furious with the Republicans in Congress because they haven’t taken down the Democrats, impeached the president, and denied funding to ObamaCare. Business interests are furious with the Tea Party because of their encouragement for shutting down the government, and opposition to increased immigration. Libertarians keep complaining about the regulatory state, and want more conversation about liberty — personal and economic. Republicans disagree about a lot of things, but they also agree about most of the really important ones.
Democrats apparently agree about everything, They even agree in exactly the same words, so one must assume that “the words” are passed down from a particular source, probably the Center for American Progress, the home of those who now want to be called ‘progressives’ instead of ‘liberals’ because ‘liberal’ has become somewhat out-of-favor word. Since they are well-informed by the left-wing media, they scrupulously avoid anything that might question their certainties, which makes it hard to find ways to compromise with opponents.
There is a lot on which Republicans agree. Free markets, free people, respect for the Constitution, support for the military, small government, avoiding over-regulation, low taxes, balanced budgets, fiscal conservatism — a very partial list. But some are neglecting what is meant by a big tent. The Founding Fathers put together a government where the process was meant to be slow so that all sides could be heard and disagreements fully aired. Individuals have their own opinions. Expecting everyone else to agree, or attempting to drum out of the party those who do not agree is a recipe for disaster. Concentrate on the areas of agreement, and support those who agree most of the time.
I agree with the Tea Party. I think the Obama administration is the most incompetent and corrupt administration that we have ever had. I agree with the Libertarians that big government and the administrative state are way out of control, and that Americans are perfectly capable of managing their own affairs without government interference. I agree with business that over-regulation and uncertainty are devastating to business; and if we want a recovery we need to remove the barriers we put in the way of business. There is no reason in the world why America should have the world’s highest corporate tax. Corporations don’t pay taxes, they pass them through to consumers in the price of their goods. No candidate is going to be perfect. We are human, a quarrelsome, flawed species, and we are not going to agree on everything. Don’t expect perfection. If we are going to win, we need everybody in the big tent.
Filed under: Capitalism, Democrat Corruption, Domestic Policy, Economy, Health Care, Progressivism | Tags: Canadian Medical Tourism, Escaping Inadequate Care, The Failure of ObamaCare
Democrats like to claim that the inspiration for ObamaCare came from Massachusetts’ Romney Care. They did copy the individual mandate, I believe, and had as an adviser someone who had helped to develop RomneyCare.
However, the main group of Obama’s health care advisers: Ezekiel Emanuel MD, Tom Daschle, Peter Orzag, Donald Berwick MD and Jacob Hacker, were all great admirers of Britain’s National Health Service (NHS). Much of their admiration was centered on the idea that the highest medical costs came from elderly people in their final years, and that to significantly cut costs, they would have to limit those costs in some way.
Why they would admire a system so mired in scandal — with elderly patients dying in hospital from dehydration and starvation — is hard to understand, for the stories are published regularly in the British newspapers, from people who are using super glue to fasten in their teeth due to inability to see a dentist, to patients parked in ambulances outside hospitals to keep the numbers at emergency rooms down.
Back before ObamaCare first passed in this country, we noted that Canadians unable to get the care they needed in Canada were coming to the US for care in droves. They were suffering from long wait times to see a specialist, lack of availability of advanced diagnostic equipment or long wait times to get to use it. Here, an appointment for a CT scan can be had in 45 minutes.
You don’t get sent to a specialist unless you have a potential problem. Some potential problems are far too catastrophic to wait for several months. Now, we learn that today, as many as 41,838 Canadians — out of a population of around 35 million — left the country last year for health care treatment. More than 42,000 did so in 2012, and more than 46,000 sought treatment elsewhere in 2011. The Fraser Institute calls the 2013 figure a conservative number and says that it is deeply damning about Canadian care.
Canada has companies devoted to arranging medical tourism, including Costa Rica, India, Thailand and the U.S. Some companies send clients to Mexico, Turkey, Poland and the Dominican Republic. Those who leave Canada for treatment do so for reasons related to the country’s government-run health care system: better outcomes, avoidance of the consequences of wait times, concerns about the quality of medicine in a country whose system destroys the incentives needed to build more advanced facilities and develop higher tech medicine. [Note the word "incentives" in that last sentence.]
It is hard to tell, but ObamaCare seems to be in a death spiral — the insurance pool equivalent of bankruptcy — when too many older and sicker people sign up for insurance relative to the number of younger healthier people. According to figures released this week over half the people who have enrolled are over the age of 45, and only 24 percent are between the ages of 18 and 34, half the number needed to keep premiums affordable.
Democrats will not admit the depth of the problems, and most probably will attempt to switch it to a “single-payer” plan which is what they wanted all the time like Britain’s failed NHS.
The most frightening possibility is attempts to patch, jigger, or reform the current plan. Obama is determined to do whatever is necessary by executive order, but how far he will take that is unknown. ObamaCare cannot be fixed. The most basic need is to get government out of the business of running American health care. They are not competent to do so.
Free markets, free people — and let innovation triumph.
Filed under: Capitalism, Democrat Corruption, Economy, Election 2014, Health Care, Law, Politics, Regulation | Tags: $56 Billion In Faulty Payments, Fiscal Irresponsibility, Waste and Fraud
John Steele Gordon wrote at Commentary magazine:
Imagine that a health insurance company chose a random sample of payments made to its claimants and found that 10.1 percent of them should not have been paid at all, either through error or fraud. What do you suppose would happen?
First, whoever was in charge of accounts payable would be fired on the spot, his office contents on the sidewalk in cardboard boxes before the day was out. Second, a thorough overhaul of procedures would be quickly put into place to make sure the error rate was reduced to as near zero as possible. Third, a federal prosecutor would open an investigation into possible criminal activity. Fourth, a congressional committee would convene hearings and beat up the CEO for charging such high premiums when simply running his company properly would have allowed them to be drastically reduced.
But when Medicare’s fee-for-services programs ran exactly this error rate, the result was … oh, look, a squirrel!
At what point do we start talking about “real money?” Do our government officials get so accustomed to speaking in terms of trillions (the budget deal just signed into law) and billions that they lose any sense of what their casual expenditures and sloppy bookkeeping mean to a taxpayer’s family budget? Or do they simply think of it all as “government money” and fail to recognize that it all came out of the pocketbooks of real people?
The Department of Health and Human Services (HHS) had exactly that error rate in 2013, and paid no less than $33.2 billion that it shouldn’t have paid at all. Overall they paid out $55.9 billion improperly. Was anyone in accounts payable escorted to the street accompanied with their office contents? Don’t be silly.
The Center for Medicare and Medicaid services spokesman Tony Salters said CMS doesn’t even attempt to recover all of its estimated overpayments. He said that agency contractors attempt to recover improper payments, and get “most” of that back, but those improper payments represent only a fraction of the total amount paid out incorrectly.
The White House’s Office of Management and Budget (OMB) estimates that in just 13 “high-error programs” in fiscal 2012 wrongly paid out a shocking $101.3 billion. That’s a 2.86 percent of total federal spending — $16 billion more than the entire sequester for fiscal 2013. The sequester, with shrieks of pain and suffering, amounted to $85.4 billion and the end of the world.
Insurance companies, criticized and demonized, run tight ships, constantly looking for ways to cut costs and eliminate fraud and error. Any business with a 10.1 percent error rate would quickly end up in bankruptcy court. But there seems to be no check on government agencies. They cannot go bankrupt, and they apparently cannot be held to account for their intransigence. After all, it’s just “government money.”
Filed under: Democrat Corruption, Domestic Policy, Health Care, Law, Politics, Progressivism, Regulation | Tags: Late-Night Humor, ObamaCare Signups, Will The Young Sign Up?
When a program or a policy becomes the feature of late-night comedy routines, is it a sign that the program or policies are failing? Jimmy Kimmel did a bit on ObamaCare and the supposition that young people would sign up in droves to support the more expensive health care of older people that was truly funny. Perhaps the ACA is a rip-off for the young?
Is this a sign that the left is turning on Obama? Too early to tell, but hope springs eternal.