Part 3, August, 2013 Obama care Update: Poll Results Are Unfavorable, Hospitals Getting Screwed, Illogical Pricing, and More

This is the third post of what is hopefully only a four post series for this month that reviews the disaster that is Obama Care. In the past two days we have learned how the majority of Americans and small businesses correctly assessed that Obama care will raise health insurance costs, curtail economic and business growth, and will not solve the problem of escalating health care costs in this country. We have learned of American workers getting their work hours and salaries cut as businesses and government entities try to cope with the onerous taxes, fines, and requirements of Obama Care. Not a pretty picture.

And the next pieces of that not pretty picture continue below:

1)  Fox News recently conducted its own public opinion poll relative to how people feel about Obama care and found the following results, all consistent with the previous polls we reviewed from NBC, CBS, Huffington Post, The Wall Street Journal and the U.S. Chamber of Commerce:

• The poll found that 57% of registered voters believe that implementation of  Obama Care is a joke while 31% say it’s “going fine.”
• Poll participants overwhelming say that Obama Care will have a negative effect on their wallet.
• 71% of those polled  believe Obama Care will  raise their taxes.
• 62% agree with the premise that Obama Care  increase their health insurance premiums.
• 65% believe Obama Care will raise the Federal budget deficit.
• Pluralities of participants of the survey agree with the notion that ObamaCare will reduce the quality of healthcare for themselves and all Americans.
• 63% of Americans say that the law needs to be amended and that Congress should continue working on legislative fixes for the law. 
• That’s up from 58% in July. 
• Only 31% say think that Congress should move onto other issues and leave Obama Care as it is.

Again, for my liberal friends that automatically knee jerk and convulse whenever Fox News is mentioned, feel free to ignore these poll results, but they are consistent with poll results from mainstream news sources other than Fox.

2) The Associated Press recently did an investigative report on what Obama Care is doing to smaller sized hospitals across the country. Remember that Obama Care cuts the funding for hospitals that accept Medicare and Medicaid patients in order to fund Obama Care’s programs. 

If the cut in  Medicaid and Medicare funding to hospitals goes through, many of these hospitals will either close because of financials or stop accepting Medicare and Medicaid patients, endangering the health and welfare of those patients:

• Since 2000, 19 hospitals in New York have closed due to financial pressures and two more are about to close. 
• Among other causes, the article notes that, “Revenue from government health programs like Medicaid has gotten smaller,” and that situation is expected to get more dire as a result of Obama Care.
• According to the article, actuaries at the Centers of Medicare and Medicaid Services have been warning about this growing crisis since the passage of Obama Care in 2010.
• Paul Spitalnic, the acting chief actuary of the Centers for Medicare and Medicaid Services, is quoted in the article that assuming the Obama Care cuts go into effect, “the prices paid by Medicare for health services are very likely to fall increasingly short of the costs of providing these services. Medicare prices would be considerably below the current relative level of Medicaid prices, which have already led to access problems for Medicaid enrollees, and far below the levels paid by private health insurance. Well before that point, Congress would have to intervene to prevent the withdrawal of providers from the Medicare market and the severe problems with beneficiary access to care that would result.”

What a mess. We actually have a health care law that will make health care less accessible to Americans in the form of fewer financially viable hospitals or fewer hospitals that take Medicare and Medicaid patients in order to stay financially viable. And if the Washington political class gets scared enough to restore the funding to Medicare and Medicaid hospital payments, then the financial model for Obama Care blows up even more.

How badly does it blow up? According to a General Accountability Office  analysis, such a scenario would add about $6.2 TRILLION to the national debt. So much for Obama Care “not adding a single dime to the national debt,” as was promised when the legislation was enacted. Just another unintended consequence/disaster of Obama Care, fewer hospital resources to treat the sick.

3) We have made the case many times that those who actually wrote Obama Care were pretty much out of touch with reality. For instance, the law says you will be fined if you do not purchase health care insurance for yourself and your family:

• But the financial penalty for not purchasing insurance is a small fraction of the cost of purchasing insurance so why would anyone feel the overriding need to pay more, especially younger, healthier Americans, for insurance that they probably do not need. 
• Additionally, that fine can only be imposed if your IRS tax return says you are entitled to a tax refund and the government/IRS withholds the Obama Care small penalty from that refund. Assuming they can even find out that you do not have insurance AND you are getting a refund.
• Additionally, the law says anyone with a pre-existing condition cannot be turned down for health insurance, so why not delay purchasing health care insurance until you need it since you cannot be turned down? Insanity and a complete loss of touch with reality. 

We go through this review to show an example of how inane this law is when you get down to the details. Consider the following scenario, as calculated via the Kaiser Foundation’s Obama Care benefits calculator:

• If an individual or family makes “too much” money, they will lose their eligibility for a Federal Obama Care health insurance subsidy, and be stuck paying the entire insurance premium themselves and their families. 
• Theoretically, a pay raise or other household income enhancement would force them to fork over thousands of dollars more to the insurance companies, all because they made over the federally mandated income threshold.
• The income thresholds are based on the Federal Poverty Level (FPL), which varies by family size, age and other factors. 
• For example, if a family made between 300% and 400% of the FPL, that family would be responsible for paying no more than 9.5% of their income toward insurance premiums. As long as the family’s income remains at or below 400% of their respective FPLs, they would get federal Obama Care subsidies to pay the remainder of the insurance premium.
• As soon as a family makes even $1 over 400% of the FPL, they’re no longer eligible for a federal subsidy, and they must pay the entire premium themselves.
• Consider an American family of five as an example. Both parents are 56 years old, and they have three kids. Their income is exactly 400% of the FPL at $110,280. 
• Because their income is at the highest threshold, they are responsible for paying no more than 9.5% of their income toward insurance premiums, and they qualify for an Obama Care  subsidy that picks up the difference.
• Using this data and the Kaiser Family Foundation “subsidy calculator,” the calculator determines that the Obama Care “Silver” plan’s annual premium is $19,832. 
• The subsidy would cover $9,355, and the family would be responsible for the remaining $10,477 (9.5% of their $110,280 income).
• Now assume that mom and dad each get a 50-cent raise in their ANNUAL salaries. 
• Their household income climbs an entire dollar to $110,281, putting their household income exactly $1 over 400 percent of the Federal Poverty Level. 
• This $1 annual increase to household income means that the family no longer qualifies for Obama Care’s 9.5-percent-of-household income cap on their health-insurance premiums. 
• According to the legislation’s inane calculations, the family’s total annual premium for their Silver health-insurance plan remains $19,832 but now because they earn too much money to qualify for the Federal Obama Care subsidy, they must pay all of that $19,832 premium. 
• As a result, the cash they must pay out of pocket for their health insurance plan goes from $10,477 per year to $19,832 per year, an increase of $9,355.
• Thus, a $1 dollar annual increase in annual household income is negatively offset by the additional $9,355 they must pay for health insurance.

This is obviously an extreme example. No one gets an annual raise $1. But the concept is still valid. The drop off in benefits and help in paying sky high health insurance costs, given changes in household income, is drastic and plain stupid relative to whoever wrote the law. If we were going to have a law like this, the dropoffs should have been smoothed over so that American workers could still enthusiastically look forward to raises without having to worry about losing money as a result of those raises. Government logic run amok.

Americans who think the legislation is a joke. Hospitals going bankrupt or cutting services as result of the legislation, the exact opposite of what you want in a health care crisis. And dumb government logic that makes workers' raises a potentially very large negative on household income. What else could go wrong? Come back tomorrow to find out.

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 

Part 2, August, 2013 Obama Care Update: Navigators That Cannot Navigate, More Polls Down On Obama Care, And Breaking The Law That Is Obama Care

Yesterday was the first update for this month regarding the ongoing disaster that is Obama Care. In that post we found that insurance premiums are gong up, not down, as promised by Obama. Insurance companies are either pulling out of state based Obama Care exchanges because they cannot make money by being in them or they are proposing premium increase that are gag-worthy. Opinion polls from the Wall Street Journal and other mainstream media news sources all show the substantial opposition to the law’s tenets, requirements, and absurdity.

But all of the bad news could not be contained in just one post, Today we continue with the disasters we did not cover yesterday.

1) The Washington Post recently did an investigative report on the implementation of Obama Care. One aspect of the report is a series of quotes that they found from SUPPORTERS of Obama Care, not the majority of Americans who think Obama Care is not a good thing. As you read these supporters’ quote, remember that we are less than 60 days from a rollout of a major component of the law:

• “Advocates on the ground are really struggling with that group. They want to have a positive message but don’t know what to say.”
• “We’re in an environment [now] where 40 percent are against it, 35 percent are for it and neither side knows what’s actually in it.”
• “How hard does the insurance department or Medicaid department in a red state [that opposes the law] make it to implement this?”
• “Everybody is having sleepless nights given the magnitude of the effort and the short amount of time.”
• “It’s like building a bridge from both ends and hoping, in the end, they connect.”
• “I read [the delay of the employer-mandate] as an admission that not all of the components of the [data] hub are working.”
• “Some of the guidance from the federal government is still coming. That means we can’t get to our wish list.”

I especially like the quote of building a bridge from two different shores and hoping that they actually connect in the middle of the river (this quote could probably apply to all Federal government programs). These are what supporters say about this unfolding fiasco.

2) Two other noteworthy facts were included in the Post’s negative report on Obama Care:

1. A recent  Huffington Post opinion survey found that 52.5% of Americans are against ObamaCare, compared to 40.5% who are for it. This 12-point gap is the largest gap that this poll has ever measured.
2. Another recent survey, according to the article, asked younger Americans whether a $210 premium under Obama Care was affordable. Only 29% of likely marketplace enrollees said yes.

This second point is critical. The Post concluded in its report that if a large number of young Americans do not sign up for Obama Care, which today is a highly likely occurrence according to poll results, the “law will fail.” 

3) Cato had a recent analysis of the potential risk Obama Care faces from a set of lawsuits that have been filed across the country. These lawsuits are particularly important in light of the critical need for the Obama administration to have a lot of young people sign up for Obama Care health care insurance:

• The attorney general of Oklahoma, a group of small businesses, and individual Americans across the country have filed lawsuits which challenge the Obama administration’s plans to issue Obama Care tax credits in the 34 states that have opted not to establish one of Obama Care’s health insurance exchanges themselves. 
• The law’s writing explicitly only  authorizes those credits and related subsidies “through an Exchange established by the State.” 
• Nowhere, and in no manner, does Obama Care allow the administration and Federal government to issue credits through the 34 state Federal-based exchanges established and operated by the Federal government. 
• Despite the wording of the legislation, the White House is trying to spend an estimated $700 billion over 10 years in those 34 states without state health care exchanges and without Congressional authorization.
• Both the non-partisan Congressional Research Service and Harvard Law Review have found that these lawsuits are credible. 
• Plaintiffs in one of the suits have asked the court to block that illegal spending before it begins in 2014. 
• Supporters of the law admit that if that happens, according to the Cato report,  Obama Care does not just fail, it collapses.

It is hard to believe that this monstrosity of a law still works if about 68% of the young Americans in 34 states do not get any support at all to pay for overpriced Federal health insurance exchanges. 

4) We have reported on how many entities, both private and governmental, have had to cut workers and/or cut workers’ hours since Obama Care will impose impossible costs on their operations, costs that require them to find other ways to stay solvent. A recent article from July 23, 2013 in Florida Today reported on how a Florida county has had to cut staff hours strictly as a result of Obama Care:

• Obama Care’s Mandates Would Cost Brevard County $10,000 A Year Per Employee: Brevard County Insurance Director Jerry Visco said every employee added to the county’s health insurance program could cost the county about $10,000 a year per person, and ‘that money is not there’ in the county budget.
• Annual Estimated Total Cost To Brevard County — $1.38 Million A Year: According to Director Visco’s analysis, providing health insurance to 138 part-time workers under Obama Care would cost the county $1.38 million a year.
• To Date, 37 Brevard County Library Employees Have Had Their Hours Cut: Brevard County Library Service Department Director Jeff Thompson said 37 of his department’s employees have had their hours cut as a result of the health care issue. 

More Americans losing salary dollars as a result of a Federal government law that has no chance of being successful. Pitiful.

5) Even though the President has delayed the rollout of some facets of Obama Care for businesses until January, 2015, probably illegally, a recent U.S. Chamber Of Commerce shows how devastating Obama Care will be to small business growth and financial health:

• 24% of small businesses polled say they will reduce hiring as a result of Obama Care‘s tenets, requirements, and taxes.
• 23% of small businesses  plan to replace full time employees with part-time workers to avoid triggering Obama Care’s insurance  mandate.
• Only 30% are ready for the law or even understand what is required.
• Dealing with Obama Care is the biggest worry of small businesses.
• The Chamber survey found that "nearly one-in-four employers say the health care bill is their biggest obstacle to hiring more employees."

Different survey of a different set of Americans but the same results: Obama Care is bad news, more costs for little or no problem resolution.

6) Last set of bad news from Obama Care today. The following distressing and scary facts come from a National Review article from July 22, 2013. Much of the following disasters-waiting-to happen come from testimony given to Congress’ House Oversight and Government Reform Committee in the spring of 2013. Hold on for what will scare the daylights out of you:

• Obama Care "navigators" are supposed to be highly trained specialists that will help Americans understand and obtain the best health care insurance for themselves under Obama Care insurance exchanges. They will theoretically have access to every American’s personal information including name, address, medical history, social security numbers, etc., an identity thief’s data paradise.
• Given that 34 states will not be setting up exchanges, the Federal government will now have to find resources to become navigators and are turning to a wide variety of organizations that have no experience in health care and health care insurance including Planned Parenthood, churches, senior citizens groups, and other organizations that are ill prepared to get things right.
• The Government Accountability Office recently reported that the administration is considering allowing navigators to assist with outreach and enrollment tasks even before completing their formal training. The reason? The navigators program is behind schedule and drowning in its own complexity. So, given that they are untrained, let’s go forward anyway? Insanity.
• Despite the reality that navigators will have access to sensitive personal data such as Social Security numbers and tax returns, there will be no criminal background checks required for them. Indeed, they won’t even have to have high-school diplomas. Can you say massive identity theft? Hiring potential criminals to have such access to such data is beyond stupid.
• Navigators will take a 20–30 hour online course (i.e. no idea of how well they learned in the absence of a trained trainer) about how the 2,000-page law works. This works out to only about four days of training to learn everything they need to know about Obama Care and all of the related insurance plans they will be offering. Not going to happen.
• Even worse, many of the exchanges are also going to serve as voter registration outlets. Talk about incompatibility of objectives, you are either a health insurance expert or a voting registration expert. Trying to do both tasks with severely limited training is a disaster for both objectives.

Tell me this is not a disaster waiting to happen. We have already reported on how calling the IRS “navigators” on their 800# support line almost always gets you different answers for semi-complex tax issues, how can anyone expect a brand new Federal bureaucracy to get it right when the IRS has not gotten it right after decades of trying?

A similar comparison is made at the end of the article relative to the Federal government trying to get any complex task successfully implemented:

If there is a silver lining in all of this, it is that the potential failure of the navigators program could further convince voters that Obama Care is simply unworkable. “The Obama administration wants something the federal government has never done: a computer system that connects HHS, the Internal Revenue Service, the Social Security Administration, Homeland Security and perhaps other departments,” John Goodman, a health-care expert with the National Center for Policy Analysis, wrote in the Wall Street Journal in May. “For perspective, consider that the Veterans Administration converted to electronic medical records in 1998 and the VA and the Defense Department tried without success to share records until February [2013] when then-Secretary of Defense Leon Panetta announced that the plan would be abandoned.”

Fifteen years and probably billions of dollars wasted to get to highly interrelated Federal entities to have their computers talk to each other, an effort that ended in failure. There is no chance that the exchanges and their navigators cannot also end in failure.

More Obama Care failures 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.robertringer.com/
http://www.youtube.com/watch?v=08j0sYUOb5w 

Part 1, August, 2013 Obama Care Update: Higher Insurance Rates, Less Competition, More Disgust with the Law

It has been about a month since we talked about the disaster that is Obama Care. That is not because the disaster has not continued to unfold. We will need a few posts, at least, this month to get up to date with how this horrid piece of legislation is falling apart in front of our faces and the collateral damage it is doing to American families, the economy, and our freedom.

In no particular order, rhyme or reason, the disaster that is Obama Care:

1) Remember how the President promised that if you liked your current health care insurance and your current doctors you could keep them under Obama Care? We have previously reported on how the Congressional Budget Office has officially estimated that seven million Americans will lose access to their current health care insurance plans and doctors, Obama’s promise not withstanding.

In an August 6, 2913 article on their website, the Heritage Foundation illustrated why this is happening from a real American family’s perspective. In Indianapolis, married couple Rod Coons and Florence Peace were happy and satisfied with their current health insurance coverage: “I’d prefer to stay with our current plan because it meets our needs.”

But their happiness is going to have to take a back seat to what Obama Care will dictate for their lives.  Their current insurance won’t qualify as “government-approved” coverage under Obama Care, meaning they will have to find different coverage if they do not want be considered criminals under Obama Care’s tenets and restrictions.

You see, their current plan has a $10,000 deductible, a fact that the couple are happy with.: “I’m only really interested in catastrophic coverage” in the event of a medical emergency like a heart attack or cancer. But Obama thinks he knows what is best for them, not what they think is best for them. 

By invalidating what had been a valid health care insurance option for this family, Obama Care will now force them to change health insurance plans to meet the laws’ mandate to purchase health insurance, as defined by the Washington political class. How does that happen in a free country?

2) Major components of Obama Care are supposed to start rolling out for implementation within the next 60 days. The administration has had years to get ready and to educate Americans on the benefits of Obama Care. How good of a job have they done, with less than two months to go to a major rollout of the law’s processes? Not well, if you believe a recent poll conducted by the Wall Street Journal and NBC, as discussed in an August 5, 2013 posting on the Journal’s website:

• 47% of Americans say the law overhauling the nation's health system is a bad idea, compared with 34% who call it a good idea.
• More than half of working-class whites say it is a bad idea. 
• What is really amazing,  48% of those Americans currently without health insurance, the Americans most likely to gain something from the law and the reason the law was enacted in the first place, also said that Obama Care is a bad idea. 
• By a 30-point spread, political independents think they will be worse off under the law than previously.
• Only about six in 10 liberals and a similar share of Democrats said the law was a good idea and that support has even dropped slightly in the past month. 
• Just 30% of those making less than $30,000 a year, and 37% of young adults, call the law a good idea. That's a weak showing among two core Obama constituencies.
• Suburban women, a key voting bloc for both parties, say, by 43% to 13%, that they will be worse off under the new law. 
• Political independents say the same by a similar count of 42% to 12%.

We have always maintained and shown how poor this legislation is and it seems most of America believes the same thing. If these feelings and beliefs cannot be turned around with 60 days or so, the rollout of Obama Care processes will be met with a big yawn or outright repulsion and avoidance. 

What happens if Obama Care shows up but no Americans do? It is likely to die from its own weight because for this monstrosity to work, everyone has to go out and buy overpriced and under featured Obama Care health insurance policies and that is not going to happen if current opposition to the law stays where it is today. 

If Obama has not been able to sell this in the YEARS leading up to this point, I doubt he can sell it in the next few MONTHS. A quote from the article from Democratic pollster Peter Hart best sums up President Obama's health-law predicament this way: "He signed it, but he never sold it."

3) A July 23, 2013 article from the Washington Post looked at a different poll but basically came up with the same results:

• Soon after Obama Care was passed in 2010, 74% of moderate and conservative Democrats supported the new legislation.
• However, now, only 46%  of these same people support the law.
• This level of dissatisfaction is down 11 points in the past year. 
• Liberal Democrats, by contrast, have continued to support the law at very high levels – 78% in the latest survey.
• Overall, 42% of Americans support and 49% oppose the law, a substantial difference from an even split at 47% apiece last July

Different survey, different source, same results: the majority of Americans correctly understand that this is one lousy piece of legislation.

4) One last poll finding. In late July, a CBS survey poll found that only 13% of those polled think Obama Care will help them, and almost three times that number, 38%, think the law will hurt them. Are we seeing a trend here? America does not like or want Obama Care. 

5) On August 5, 2013, Aetna, one of the country’s largest health insurance companies, announced it was withdrawing from Maryland’s new health insurance exchange under Obama Care due to insurance policy rate cuts. Obama Care would have required Aetna to drop its monthly health insurance premium that it charges its customers under the Obama Care exchanges by 29%, from $394 to $281 a month.

In a letter to Maryland Insurance Commissioner Therese M. Goldsmith, Aetna said that the plan “would not allow us to collect enough premiums to cover the cost of the plans.” Additionally, Aetna issued the following statement relative to its pulling out of Maryland’s Obama Care health insurance exchanges: “This is not a step that we take lightly. We believe it is critical that our plans not only be competitive, but also financially viable, allowing Aetna and Coventry [an Aetna subsidiary] to meet the long-term needs of the Exchanges in which we choose to participate.”

Aetna has also dropped out of the exchanges in California and Georgia, presumably for the same reasons: Obama Care’s rules and tenets are not financially reasonable or viable. Thus, what was supposed to be a highly competitive marketplace for health care insurance plans, through the exchanges, probably just a got a whole lot less competitive and fewer options for Maryland residents if and when any resident tries to get health insurance coverage through the Maryland exchange.

This is a perfect example of what we have been saying from day one. Obama Care never addressed the underlying, root causes and drivers of our escalating high health care costs. It tried to solve a health care cost issue with a Rube Goldberg-like health care insurance approach which never attacked the real reasons why our costs are so high. 

With the root causes not addressed and resolved, high health care costs will continue to get higher and higher, and cause companies like Aetna to look for other ways to remain financially viable. In the mean time, Americans will increasingly not be able to afford health care insurance because those underlying drivers are still driving up costs.

6) The Savannah Morning news reported on July 31, 2013 that Georgia may not start its Obama Care health exchange October 1 along the rest of the country. Apparently, the state submitted an emergency request to the Obama administration to delay its rollout of its Obama Care exchanges for one month.

Why the request for the delay? Georgia Insurance Commissioner Ralph Hudgens asked U.S. Health Secretary Kathleen Sebelius for another 30 days beyond the deadline to approve the health plans submitted by seven insurance companies wanting to do business in the state‘s Obama Care exchanges because some of those insurance premium rates were 198% higher than current plans available in the state: “Georgia consumers cannot afford these massive rate increases,” Hudgens wrote in his letter to Sebelius.

A whopping 198% increase over pre-Obama Care’s rollout? Who would have thought? The real problem Georgia has, according to the article, is that independent actuaries have done their specialized analysis and found that six of the seven requests for substantial premium increases is justified under Obama Care guidelines. The seventh company is only 11% higher than what is justified, nowhere close to 198% higher. 

Another example of reality being just the opposite of what Obama, Reid, and Pelosi promised when Obama Care legislation was enacted. All across the nation, anyone getting close to implementing Obama Care exchanges are finding that insurance premiums will go up significantly rather than the promised drop in rate levels. What a train wreck, to quote Democratic Senator Max Baucus.

The Obama Care disasters will continue tomorrow. Increased prices, loss of current insurance plans, less competition, this legislation got it wrong on EVERYTHING.

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 

Will The Economic Plight and Suffering Of Young Greek Adults Become the Same Plight For Young American Adults?

As most informed people know, Greece has been a fiscal basket case for the past several years. Corruption, mismanagement of the economy, and political economic ignorance has driven the country into defacto, if not official, bankruptcy. Sky high national debt, sky high and chronic unemployment, and no viable economic or financial plan to turn the country around has created hardships for just about every Greek citizen.

But it seems that young adults in Greece, those that should be embarking on their careers and building their futures today, seem to be getting hit especially hard. Consider some of the findings from a recent Businessweek article about the young adults in Greece:

• While overall unemployment in Greece is about 27%, for young Greek adults that unemployment figure is about twice as high.
• In 2013 and 2014 it is estimated that about 40,000 government employees will lose their government funded jobs, making a horrible unemployment situation even worse.
• Over 100,000 young Greek adults have left the country to find better paying employment overseas.
• The Businessweek article discusses the plight of a young Greek woman who applies for one of 21 social worker jobs that are being interviewed for. She is one of about 2,000 people trying to land on of those 21 jobs.
• Many young Greeks have been forced to move back in with their parents and families or need financial support from their families to get by.

Heart breaking that people have to leave their country to have any chance of a good life and good paying job and career.

But, the situation in Greece is not that different than the heartbreaking challenges and frustration of young adults in this country. Consider some facts and realities, as pointed out in a recent article from the Independent Journal Review website (“8 Signs You're a Young Adult During the Obama Administration“)
from August 6, 2013:

• Since young American adults struggle to find a decent-paying job these days after graduating from high school or college, they are often left with no other financial option than to return home to live with their parents and families. According to a recent Pew Research poll, a record 36% of young adults (that's over 21 million) live with their parents. 
• This fact has consequences all throughout the economy. Since fewer households are formed, the housing market does not grow as fast to accommodate the lower number of new households formed, less furniture and appliances are sold since there are fewer new households, etc., all of which depress economic growth beyond the fact that young adults cannot find decent employment.
• As proof of this previous point, the article points at some research from Pew which found that while 40% of young adults owned their homes in 2007, the number dropped to 34% in 2011 in just four short years, and in a few of those years we were supposedly in an “economic recovery“ mode.
• The Independent Journal article cites another article, this one from Soopermexican, that pointed out 7 out of every 8 jobs added by the Obama administration have been part-time employment. Given that 2 million American young adults graduate college every year, this administration and its economic policies are turning most of those graduates into part time workers.
• While part time work for a college graduate can be frustrating, consider a recent assertion from NPR. NPR claimed as many as one-third of internships in this country are unpaid, and an even higher percentage pay less than minimum wage. Thus, it may be a better option, from a financial perspective, to flip hamburgers at minimum wage than to work for nothing or near nothing as an intern with only a faint promise of moving into full time work out of the internship.
• No job means no money which probably means no new set of wheels. According to CNW Research, while young adults account for 27% of new car sales, that is down significantly from 38% in 1985. Thus, not only does the housing industry suffer from the economy’s inability to create worthwhile employment for young Americans, the auto industry suffers also.
• Not only can’t young Americans look forward to that first big, full time, good paying job, they are already looking at how hard it is going to be to pay off their college loans. The Project on Student Debt estimates that in the past 25 years, the cost of college has risen by 900%. The Wall Street Journal estimates that two-thirds of college graduates have mounting student debt. Thus, young Americans might almost immediately take a hit on their credit scores since they cannot pay off their college loans because their college loans did not pay off in a good job. Thus, bad credit leads to the future inability or lessened ability to get a home mortgage or car loan, further depressing those two industries.
• As a direct consequence of delayed financial, career, and housing stability, young adults in America are waiting until they're older to get married. A Pew Research analysis estimates that the median age at first marriage is higher than ever in America, 26.5 years old for brides and 28.7 years old for grooms.
• Given the fact that young Americans are finding it difficult to find a good paying, full time job, they are saddled with debt , and raising kids is an expensive proposition, the Population Reference Bureau estimates that the U.S. fertility rate (# of children per woman) is now 1.9. How bad is that? 1.9 is lower than the fertility rate during the Great Depression, another bad economic time when kids were viewed as an expensive like to have, not have to have. Only this time, it is worse than the Great Depression.

Let’s go beyond these global trends and look at the latest Federal government jobs report as reported in Yahoo Finance on August 3, 2013 (“We Have Become a Nation of Hamburger Flippers”): 

• Only 162,000 jobs were created in the month of July, a month that most economists expected to see at least 200,000 jobs created.
• Even worse, updated job creation estimates for May and June were revised downward from their current estimates.
• 69% of the jobs created in the second quarter  and 57% created in the first half of 2013 – were in the three lowest-paying sectors of the economy: retail trade, administrative services, and leisure and hospitality. 
• These positions, which account for 33% of all private sector jobs, pay an average of $15.80 per hour.
• “What you’re seeing is now the spreading of low wage growth,” says Dan Alpert of Westwood Capital, “Really, we have become a nation of hamburger flippers, Wal-Mart sales associates, barmaids, checkout people and other people working at very low wages. The fact is that the U.S. employment situation is more of a wounded beast than a bull.” 

Consider more, yet similar, details from an Associated Press report from August 3, 2013:

• The 162,000 jobs the economy added in July were a disappointment as were the poor quality, pay wise and career wise, of those 162,000 positions.  Low-paying retailers, restaurants and bars supplied more than half of July's job gain.
• "You're getting jobs added, but they might not be the best-quality job," said John Canally, an economist with LPL Financial in Boston.
• Year-to-date in 2013, low-paying industries have provided 61% of the nation's job growth, even though these traditionally low paying industries represent just 39% of all U.S. jobs, Mid-paying industries have contributed just 22% of this year's job gain.

This is the so-called economic recovery that the Washington politicians have created for us, the weakest and lamest economic recovery in a long, long time in this country. We have over 20 million Americans either unemployed or under employed. We have the record for longest number of consecutive months with the official unemployment rate over 7%. We have a sky high national debt of almost $17 TRILLION that every American will have to pay off. 

And we have a train wreck (Senator Max Baucus’s words) called Obama Care about to hit young adults in America where they will become criminals in the eyes of Obama Care and Washington if they do not sign up for compulsory health care insurance, an added expense that many just cannot afford. Yes, from a young American adult’s perspective, the Washington political class has made their world and their future look a lot like Greece.

What can be done to change the situation before we actually become Greece? Albert Einstein once said that “the definition of insanity is doing the same thing over and over and expecting different results.”  Four years after the Great Recession ended we obviously have to do some things differently. What Obama, Reid, Pelosi, Boehner, McConnell, et al have been doing for the past four years has not worked, especially for young adults in this country.

Here’s a couple of potential solutions, based on Einstein’s observation:

1. Kill Obama Care altogether and start over in addressing our health care cost crisis.  This act that would terminate the asinine requirement that anyone working over 30 hours a week  is “full time.” This insanity is causing/forcing businesses across the country to change their personnel profile from full time employment to part time employment, all because of Obama Care. Killing this law would free up time for business people to focus on growing their business, with both full time and part time employees, and growing the economy and not on what Obama Care’s 2,500 pages mean for their business.
2. Dramatically reduce the thousands and thousands of  useless Federal government regulations on the books that cause business owners to waste time, energy, and money complying with many regulations that are useless from an environmental and safety perspective. 
3. Create a one time tax holiday that would amnesty the over one trillion dollars of cash that American businesses have stashed overseas in order to avoid paying high Federal taxes on. Put in some restrictions that prevent those funds from being used for executive compensation, stock buybacks, etc. and allow only employment creating expenses to be incurred with these funds (e.g. building factories, hiring more shifts, providing job training, etc.)
4. We need to overhaul our entire education system so that it is more focused on efficiently spending the way too much money the country already spends on education for far too poor results. Find out what other countries do to educate their kids far better than how we educate ours and then steal their good ideas. Make a case that becoming a welder, plumber, etc. is not a bad thing to pursue, that college is NOT for everybody.
5. Rewrite the tax code so that it fosters economic growth rather than foster revenue growth for the Federal government and for the Washington politicians to waste.
6. Allow only individual citizens to contribute to politicians’ campaign funds, not corporations, unions, PACs, and super PACs. I recent read an article that touched home in this area. The article made a data, fact based case that it is now a better business decision to spend a million dollars on Washington incumbent politicians and lobbyists to get a sweetheart deal from the government than it is to invest that million dollars in new plant and facilities, an option that would generate jobs in the process. Currently, that million dollars only creates a handful of high powered lobbyist jobs while corrupting the democratic and governmental processes in this country.

Unfortunately, according to Einstein, the odds of the current set of politicians doing something different, something effective is pretty small. They thrive and advance their political careers by maintaining the status quo. They keep their full time jobs, the fates of the careers of young American adults be damned. Even if it does turn the country into Greece.

But there is a way to take Einstein’s advice before it is too late. Visit the following website and join the cause to impose term limits on all Federal politicians. The current set of politicians are part of the problem, join the term limits drive and you can be part of the solution that results in Greece becoming a nice vacation and not becoming the financial reality for our kids and family members:

www.howmuchworsecoulditget.com

Doing things differently to help the young adults in America: sounds like a good idea and besides, how much worse could it get?

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