January, 2015, Part 1,The Unfolding Disaster That Is Obama Care: Harvard Professors In a Snit, Vermont Abandons Single Payer, and A New Year With New Disasters

We spent the past eight days reviewing the latest insanity from the Washington political class. Wasteful spending by many different government entities but especially the Defense Department,  fraud riddled government programs, government programs that seem to always be over budget and under delivering, and a whole array of other insanity and idiocy

We stayed away from the unfolding disaster that is Obama Care since that piece of legislation deserves its own, dedicated set of insanity posts. For many years, but especially over the past two years, we have written extensively on the myriad of disasters that this law keeps spawning. To review these past disasters, enter the search term "the unfolding disaster that is Obama Care" in the search box above. 

The main reason why Obama Care is failing, and will eventually fail, is the simple reality that it never addressed the root causes of our high healthcare costs in this country.  Americans eat too much of the wrong kind of food, Americans smoke and drink too much, Americans do not exercise enough, Americans on average are aging which brings a whole slew of aging disease into play, etc.  As we review the latest disasters from Obama Care this week, you will see that it has still not addressed these root causes and thus, it is still destined to failure.

Let’s see what disasters have popped up from this legislation in just the past month or so:

1) The website Minority Report recently did a nice summary of what disasters we are likely to experience in this new year from Obama Care:

• Effective in 2015, small businesses with at least one hundred employees must provide health insurance plans to their employees or pay a fine. You can bet that companies with 101, 102, or so employees are actively or have already trimmed their workforce to under 100 in order to avoid paying for health insurance that many small businesses simply cannot afford. That will result in higher unemployment and higher under employment and lower economic growth without having more people afforded health care insurance, the whole point of the legislation it the first place. Thus, all negative impacts, no positive impacts.
• For the first time ever, when American file their income taxes in a few months they may have to pay a fine if they did not purchase health care insurance in 2014. While this year’s penalty is small, it wil growth exponentially in the coming years, placing an additional burden on your annual tax filing.
• One of the big selling points of Obama Care is that the legislation expanded the definition of who could be enrolled in the Medicaid insurance program by raising the income threshold. This resulted in millions of lower income Americans getting enrolled in Medicaid. The bad news is that Medicaid payments to primary care Medicaid doctors will decrease an average of 43% in 2015, per the Obama Care legislation tenets. Thus, fewer and fewer doctors will accept Mediciad patients, especially if those patients are now 43% less valuable to them. Which gets us back to what we have often said about the whole Obama Care legislation: the good news is that you now have health care insurance. The bad news is that there are no doctors that accept that insurance, i.e. your have health care insurance but you do not have health care.
• The CHIP program, the Child’s Health Insurance Plan, has been providing low cost health care insurance for the nation’s lower income kids for 27 years. However, while Obama Care reauthorized the program through 2019 it only funded it until next year when the program will crash and burn unless reauthorized and budget money allocated. Given how dysfunctional Washington is, that budget reauthorization exercise is probably not a slam dunk and a 27 year old program that helps our kids will die off as a result of shortsightedness of the Obama Care legislation.

These provide a good baseline view of just some of the major disasters still unfolding out of Obama Care.

2) Sometimes there is justice in the world and a recent article in the New York Times provided that. Apparently, many Harvard University professors have supported Obama Care in the past, either with actual consulting and direct input or just cheerleading from the sidelines.

But recently, reality struck the faculty and the university and those that are the Harvard family are not happy, according to the Times article.  Apparently, members of the Faculty of Arts and Sciences, the main core of the university, voted overwhelmingly in November to oppose changes to their university health care plans which now require them and thousands of other Harvard employees to pay substantially more for health care and health care insurance. 

The university counters by stating that  the increases are in part a direct result of  Obama Care requirements and tenets, which many Harvard professors originally supported. I guess what goes around comes around...usually to bite your where the sun don’t shine. What did these professors think would happen, that they would somehow be exempt from the pain that the rest of the country is going through?

In its 2015 health care insurance enrollment guide, the university said it “must respond to the national trend of rising health care costs, including some driven by healthcare reform,” in the form of the Affordable Care Act. The guide said that Harvard faced “added costs” because of provisions in the health care law that extend coverage for children up to age 26, offer free preventive services like mammograms and colonoscopies and, starting in 2018, add a tax on high-cost insurance, known as the Cadillac tax.

Despite this reasoned argument, some of the Harvard professors went crazy, according to the article:

• Richard F. Thomas, a Harvard professor of classics and one of the world’s leading authorities on Virgil, called the changes “deplorable, deeply regressive, a sign of the corporatization of the university.”
• Mary D. Lewis, a professor who specializes in the history of modern France and has led opposition to the benefit changes, said they were tantamount to a pay cut. “Moreover,” she said, “this pay cut will be timed to come at precisely the moment when you are sick, stressed or facing the challenges of being a new parent.”

Poor babies, welcome to the real world. Millions of Americans have been living though these same financial and health care pains for over a year and they never endorsed the Obama Care legislation to begin with. Two quoted professors understood reality better than many of their peers:

• Jerry R. Green, a professor of economics and a former provost who has been on the Harvard faculty for more than four decades, said the new out-of-pocket costs could lead people to defer medical care or diagnostic tests, causing more serious illnesses and costly complications in the future. Well, duh, that has been the reality for over a year in the rest of the country as a result of Obama Care.
• Meredith B. Rosenthal, a professor of health economics and policy at the Harvard School of Public Health, said she was puzzled by the outcry. “The changes in Harvard faculty benefits are parallel to changes that all Americans are seeing,” she said. “Indeed, they have come to our front door much later than to others.”

Advice to Harvard professors and others like them: be careful what you support and endorse, it could come back to haunt you and your pocketbook. 

3) One last piece of Obama Care disasters for today, more to follow tomorrow. Some liberals in this country think that Obama Care did not go far enough, that they wanted a single payer system where the government and the politicians that operate it have total control over your health care fate. 

Never mind that where countries have implemented single payer systems the costs have gone way up while the quality of care has gone way down. Also, never mind the reality that American politicians and government entities in this country cannot operate simple functions effectively and efficiently never mind managing the healthcare experiences and finances of over 300 million people. Do you really want people like Nancy “we have to pass the legislation to see what is in it” Pelosi to have anything to do with your health?  Never going to happen.

Nor should it from a financial perspective. The state of Vermont was once hot to trot about passing a single payer health insurance program in their state. However, their governor recently stopped its implementation based strictly on the reality of the financials, as recently reported by the Against Cronyism website from Forbes magazine:

• The state government baseline view for the state of Vermont estimated that the state revenue would be about $1.7 billion in fiscal year 2017.
• However, if the state implemented a single payer health insurance program for state residents, the state budget would have to increase an amazing 151% to cover the expenses of a single payer system.
• This translates into the state increasing its tax burden on state residents by $2.6 billion, on top of the baseline $1.7 billion budget, just to cover the single payer system costs.
• Obviously, this would have been the largest component, by far, of any operating expense in the entire state government budget.

Thus, even the politicians that wanted to go to a single payer system were not able to make the numbers work. And one reason for that is that they are trying to fix the wrong things. We do not have a health insurance problem in this country, we have a health problem in this country as we have said many times before.

Until we address the underlying root causes of high healthcare costs in this country, e.g. too many smokers, not enough exercise, too much obesity, a fat, salt, and sugar infected food chain, etc., no amount of any kind of insurance is going to reduce costs. It may move costs around due to fees, fines, taxes, and subsidies, but the overall healthcare costs stays the same or even gets worse. 

That is why Obama Care continues to be an unfolding disaster, they never addressed the real problems. And more disasters follow tomorrow.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:

Term Limits Now: http://www.howmuchworsecoulditget.com
http://www.reason.com
http://www.cato.org
http://www.bankruptingamerica.org
http://www.conventionofstates.com
http://www.youtube.com/watch?v=08j0sYUOb5w

Snoopy And The Fiscal Downfall Of America, Part 2: The Whole Federal Government Debt Bomb

This is our second post in a three part series that is supposed to scare the daylights out of you regarding our dire financial situation, relative to debt and out of control government spending. Last Friday we focused only on the impending collapse of just the Social Security system and how even if that was the sole financial problem facing this country, if we stay on the current trend line even this one problem will bankrupt the country and destroy our freedoms and liberty. 

Today, we will look at the whole Federal government financial picture, leaning heavily on the recent dismal analysis from the nonpartisan Congressional Budget Office. Before we get into today’s discussion of fiscal doom, let’s review the Snoopy analogy we used to start off yesterday’s post since it still applies to the overall government financial malaise:

Many years ago there was a Sunday Snoopy comic that sets up today’s post. Seems Snoopy was going out for job on a cold, dark winter morning. Before long his knees started complaining because they were taking all of the pressure form the jog steps. The feet chimed in to complain that the knees did not know what they were talking about since the feet got the initial shock of each step. Before long the lungs started to complain from sucking in the cold winter air.

This went on for a while, with each body part complaining that they did not want to be out on an early morning winter jog. Finally one of them asks, “Whose idea was this anyway, to go jogging on this early and on this very cold morning?” At that point, the heart spoke up and said: “It was my idea because jogging is good for me and if I go, you all go.”

There are many serious issues facing America today. Failing public schools, a lost war on drugs, a leaky border, inept and lazy politicians, the constant battle for gay rights, etc. these are all important and need to be worked. However, relative to the Snoopy story, these are just body parts that need attention on a cold, dark winter morning relative to the basic fact: the United states Federal government is on a dangerous and fast track to fiscal ruin and collapse. 

And if that fiscal and financial integrity collapses, much like the heart, every other issue becomes secondary in face of an economic collapse, a collapse that trashes all of our freedom and liberty. We are going to take a few days to look at how dangerous that track is and how close we are to having a fatal financial heart attack that will make the other body parts, i.e. national issues, wilt in comparison to the dire consequences.

Okay, so from Friday we know that 1) Social Security alone will bankrupt the country if nothing is done and 2) that story of financial doom is likely to be present in other major government spending programs. Today we will prove the second point using the research and analysis of the Congressional Budget Office (CBO).

The specific basis of this discussion is the recently released CBO’s annual Long-Term Budget Outlook. which had some sober news for the American people. The basic bottom line from the report is the following graph:



The gruesome details from the graph include the following:

• Federal debt held by the public almost doubled in the first five and a half years of the Obama administration, rendering his 2008 campaign promise of cutting the annual Federal deficits in half either economic ignorance or another Obama Care-like deception.
• While the debt percentage will level off for a few years, the advancing aging and retirement of the baby boomer generation will cause it to start skyrocketing with the next five to six years. 
• At no point in the current trend of Federal government spending is there EVER a budget surplus, a surplus that could be used to start reining in the runaway debt.
• Within 25 years, the public debt will be about five times as large as the annual Federal government tax revenue stream, making any delays in paying down this debt harder and harder to do as time goes by.
• And this is just current public debt. The debt that one part of the government owes to another part of the government will eventually turn into public debt also so this is an underestimation of how bad things are.

The CBO went from this graph and the underlying analysis to predict how things might turn out if nothing is done, as summarized by the Minority Report website:

1. Federal Debt Is Soaring: The debt has doubled since the onset of the financial crisis, and CBO concludes the growth in the debt is “unsustainable.”
2. Now Is the Time to Act: CBO says that prompt decisions to rein in future deficits would expand employment and economic growth.
3. The Economy Is Slowing Down: CBO has again lowered its projection of GDP growth, and the average number of hours worked by Americans is shrinking.
4. Spending Is Still the Problem: Major entitlements and interest on a growing stock of debt will cause real spending to soar by 27 percent over the next two decades.
5. Raising Taxes Will Cost Jobs: Taxes will exceed their historic average level this year, and they are on pace to rise even further. Yet these tax increases still never match the pace of spending, even while they discourage work, saving, and investment.
6. Entitlement Reform Is Key: We run the risk of breaking our promise to seniors and future generations if we don’t reform our entitlement programs soon. 
7. The Debt Threatens Our National Security: CBO warns that our growing national debt could compromise national security by constraining defense spending and limiting the country’s ability to prepare for future challenges.

As we discussed yesterday, many issues that concern many of us today wilt in comparison to how far into debt the American political class has gotten us. If we do not take care of our debt like Snoopy was trying to take care of his heart, the other body parts (e.g. failing public schools, gay rights, climate change, lost war on drugs, etc.) do not matter at all once the heart gives out.

Our total national debt is currently around $18 TRILLION. Unless something changes and the politicians in Washington find some courage, abilities, and creativity to change the trend we are on, almost another $10 TRILLION will be added to that debt load within the next ten years. This will theoretically put a person debt load onto every American of over $100,000 each. Or, the whole financial system collapses before we add another $10 TRILLION and Snoopy and the United States die of a heart attack of epic proportions.

If you care about other issues, then your first action item is to help find a way to convince the politicians and out of control spenders in Washington to grow a pair and start acting fiscally responsible. Otherwise, your favorite causes are just a moot point in our country’s now fiscally endangered history.

A good place to start your efforts to help fix the debt issue is to visit our website for term limits, 

www.howmuchworsecoulditget.com

Because really, how much worse could new people be in Congress and the White House do if the current ones are running up a debt load that will quite quickly exceed the annual GDP level? These are the same incompetents that got us into this fix, I doubt they are the same that can get us out. And so far, despite the dire warnings of the CBO and other rational Americans, I know of no one in Washington who has put forth any kind of plan to resolve the growing debt bomb in this country, do you?

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:

Term Limits Now: http://www.howmuchworsecoulditget.com
http://www.reason.com
http://www.cato.org
http://www.robertringer.com/
http://www.youtube.com/watch?v=08j0sYUOb5w