Week in Review
Let’s imagine you buy your groceries a different way. Instead of going to the store and picking things off of the shelves and paying for them at checkout imagine this. You don’t pay the store. A third party does. Like it does for everyone else that shops at this store. Sounds great, doesn’t it? Let’s say people pool their money together for purchasing power. And have this third party take that pooled money and use it to get better pricing. Because of the large amounts they will be paying for.
So everyone pays in a monthly amount to their third-party purchaser. Then goes to the store and takes what they want. And at checkout they just sign an invoice to acknowledge they took this stuff. And the store will submit the bill to the third-party purchaser. Of course, there would have to be some rules. Because if everyone pays a flat amount each month you can’t have someone picking up steaks every day when you’re buying hamburger for your kids. So there are limits to what you can buy. Requiring the third party to review every submitted invoice. Requiring a very large staff to review every grocery store purchase to approve and disapprove line items on each and every invoice for payment. To resolve billing and payment errors. And to bill shoppers for any unapproved purchases they made. Even if they didn’t understand that these items weren’t covered.
So, included with that monthly payment there must be an overhead fee. To pay for all those people reviewing those invoices. Those who bill shoppers for unapproved items. Those who pay for the approved purchases. And those who process payments from shoppers. Still, things slip through the cracks. People are getting unapproved purchases through the system. Grocery prices rise. The overhead costs at the third party grow due to new costly regulations. Etc. Such that on occasion the total amount of cash out at the third party exceeds the total of cash in. Requiring them to raise the monthly amount everyone pays.
Sounds a bit more complicated than just going to the store and paying for what you want out of pocket. And more costly in the long run. But if someone else pays the third party for those monthly fees it’s a whole different story. Say as a benefit at work. Because without you having to pay anything it’s just free groceries. At least, to you. And you will demand that your employer pays for more stuff so it’s free to you. Even though it’s not. Because the rising cost of third party grocery purchases will cost your employer. Which will limit your pay. And other benefits. Because in the real world nothing is free. Even if people think that a lot of stuff is free. Or should be free. Like health care (see Nearly 7 in 10 Americans say health plans should cover birth control by Karen Kaplan posted 4/22/2014 on the Los Angeles Times).
Among the various provisions of the Affordable Care Act, few are as controversial as the one requiring health insurance providers to include coverage for contraception. A new survey finds that support for this rule is widespread, with 69% of Americans in favor of the mandate…
Women, African Americans, Latinos and parents living with children under the age of 18 had higher levels of support for mandatory contraception coverage than people in other demographic groups, the survey found…
— 85% of those surveyed supported mandatory coverage for mammograms and colonoscopies.
— 84% supported mandatory coverage for recommended vaccines.
— 82% were in favor of mandatory coverage for diabetes and cholesterol screening tests.
— 77% backed the provision on mandatory coverage for mental health care.
— 75% supported mandatory coverage of dental care, including routine cleanings.
There’s a reason why the United States is a republic and not a democracy. For the Founding Fathers feared a democracy. And wanted responsible people between the people and the treasury. For once people understood they could vote themselves the treasury they would. And things like this would happen. Mob rule. Where the mob demands more and more free stuff while fewer and fewer people pay for that ‘free’ stuff. And people in government anxious to win elections will keep giving the people more ‘free’ stuff that others have to pay for. Until one day you end up with the health care system we have in the United States. All because other people were paying for routine costs people could expect and budget for. Things that if they paid out of pocket for would cost less in the long run. Which would keep insurance what it was supposed to be. Insurance. And not turn it into a massive cost transfer scheme that only allowed the price of health care to soar.
Tags: Affordable Care Act, benefit, bill, contraception, democracy, Founding Fathers, free stuff, health insurance, insurance, invoice, Mob rule, overhead, payment, prices, routine costs, third party
Week in Review
Health care is expensive. It’s why we have Obamacare. To lower the cost of health care. And give quality health care to everyone. But why exactly is health care so costly? And who’s to blame? Well, let’s take a look at the cost of an appendectomy to get an idea (see Reddit User Posts $55,000 Hospital Bill for Appendectomy by SYDNEY LUPKIN, ABC News, posted 1/1/2014 on Yahoo! News).
When a 20-year-old man got over the pain of having his burst appendix removed in October, he got hit with a hospital bill he wasn’t expecting.
The bill from Sutter General Hospital in Sacramento, Calif., said the total charges were $55,029.31 but that the patient owed only $11,119.23 because his insurance had covered the rest.
Shocked, the patient took to Reddit to post the bill and vent his frustrations.
“I never truly understood how much health care in the U.S. costs until I got appendicitis in October,” he wrote on the social media site. “I’m a 20-year-old guy. Thought other people should see this to get a real idea of how much an unpreventable illness costs in the U.S…”
But the bill was not so unusual, given recent studies that showed how the cost of medical procedures could vary from hospital to hospital, said Timothy McBride, a professor and health policy analyst at Washington University in St. Louis….
Sutter General Hospital spokeswoman Nancy Turner said hospital billing is complicated, and that the hospital has people available to help patients navigate it. She said hospitals often serve many patients who don’t pay at all or don’t pay the actual cost of treatment because they are on Medicare or Medi-Cal, California’s version of Medicaid.
“Sutter Health agrees that an improved billing structure is needed, where published charges are more closely aligned with actual costs,” Turner said. “And a more straightforward pricing system is only possible when reimbursement from government-sponsored patients covers actual costs.”
How much did your television cost? How much is your cable bill? How much was your laptop? Your tablet? How much was your mobile device? How much is your cable bill? How much is your cellular bill? People know these costs very well. For they are very discerning shoppers. And because they are manufacturers and providers bend over backwards to give their customers what they want at the lowest possible price. This is free market capitalism at work. Competition for our dollars makes businesses try to give us the highest quality at the lowest price. But none of this happens in health care. Because there are no free market forces in health care.
No one knows what their health care costs are. Because they don’t pay the bill. So they don’t know. And they don’t care. It’s so bad today that most couldn’t shop and pay for the own health care if they tried. On the rare occasion they pay attention to their bill what do they do? Blame the hospital for gouging on their bill. But there is a reason they do this. And it’s not because they’re greedy. They do it because it’s the only way they can keep their doors open. Thanks to the people who don’t pay their bills. And the government who doesn’t pay all of their bills. Leaving no choice for health care providers but to over-bill the insurance companies. Who are the only people paying their bills in full and then some.
Obamacare will only make this worse. By giving ‘free’ health care to more people. Health care that the government won’t pay in full. Which will force the health insurers to raise their premium prices further. Until it is so expensive that no one will buy it anymore. The so-called death spiral. Opening the door for single-payer health care. And Medicaid-quality health care for everyone. Well, perhaps not quite Medicaid-quality health care. With more people in the program wait times and rationing will be greater than they are currently in Medicaid. So it will be worse than Medicaid. The worse-quality health care currently available in the United States.
Tags: appendectomy, bill, free market, Health Care, health insurers, hospital, hospital bill, insurance, Medicaid, Obamacare, patients
The Obama Stimulus Bill was mostly Democrat Pork and Earmarks
The American Recovery and Reinvestment Act of 2009 was a huge stimulus bill to create jobs. And put people back to work. It cost about $800 billion. And it didn’t work. Some say it didn’t work because it wasn’t big enough. Others say it didn’t work because it wasn’t stimulus but rather a 40-year Democrat wish list of pet projects. Which the Democrats could finally enact having control of the House, the Senate and the White House for the first time in a long time. And they took control of this bill. As Nancy Pelosi said, “We won the election. We wrote the bill.”
So what’s in the bill? Well, President Obama said it would contain no pork. No earmarks. Just spending that would create ‘or save’ jobs. Like infrastructure projects. Rebuilding America’s roads and bridges. But according to the Wall Street Journal, “Some $30 billion, or less than 5% of the spending in the bill, is for fixing bridges or other highway projects.” They further note that of all the spending in the bill little would actually create jobs. About “12 cents of every $1…even many of these projects aren’t likely to help the economy immediately.”
Take high-speed rail, for example. The Washington Post noted the bill included “$8 billion for high-speed rail projects, for example, including money that could benefit a controversial proposal for a magnetic-levitation rail line between Disneyland, in California, and Las Vegas…” One thing about big rail projects, they don’t stimulate. Building railroads takes a long, long time. The higher the speed, the longer the time. Because high-speed trains have more costly infrastructure. And dedicated track. With no grade crossings. And before you build anything you have to do environmental impact studies. Then survey the entire route. Then, once you have a proposed route, you can begin the engineering. It could be years before any ground is broken.
If any ground is broken. Because currently high-speed rail is all pie in the sky. Only two lines to date operate at a profit. One in Japan (Tokyo to Osaka line). The other in France (Paris to Lyon line). All others require government subsidies in one form or another. Because these are costly to build. And costly to maintain. So this is stimulus that won’t stimulate. But it will set the stage for greater future government spending. Making it more pork than stimulus. Snuck into the bill by the Senate. When the House bill went to the Senate. For their turn to steal from the treasury.
Only Schools with Union Teachers did well in Stimulus Bill
The stimulus bill also included $90 billion for the Department of Education. But language in the bill restricted the use of that money. Quoting from the Wall Street Journal, “the House declares on page 257 that “No recipient . . . shall use such funds to provide financial assistance to students to attend private elementary or secondary schools.””
In other words, only schools with union teachers may use this money. Dues-paying union teachers. And the teachers unions support Democrat candidates. Which makes this not quite stimulus. But politics. Profitable politics at that. As some of this stimulus money will make it back to Democrat coffers thanks to those union dues.
According to Certification Map, education received some $90 billion in stimulus money. And their website breaks down the spending:
- $44.5 billion in aid to local school districts to prevent layoffs and cutbacks, with flexibility to use the funds for school modernization and repair (State Equalization Fund)
- $15.6 billion to increase Pell Grants from $4,731 to $5,350
- $13 billion for low-income public school children
- $12.2 billion for IDEA special education
- $2.1 billion for Head Start
- $2 billion for childcare services
- $650 million for educational technology
- $300 million for increased teacher salaries
- $250 million for states to analyze student performance
- $200 million to support working college students
- $70 million for the education of homeless children
For a bill not containing any pork or earmarks these look a lot like pork and earmarks. I mean, they sure ain’t ‘shovel-ready let’s rebuild the infrastructure jobs’ like we were led to believe. Sure, they may ‘invest in our future’ so we may ‘win the future’, but it doesn’t create jobs like a stimulus bill is supposed to do.
This isn’t stimulus. These are just Democrat pet projects. Added to the bill in a moment of crisis. To take advantage of the crisis. To get the things they’ve been unable to get during the normal legislative process.
Never let a Serious Crisis go to Waste when Writing a Stimulus Bill
When you look at the bill this is what most of it is. Just a bunch of Democrat pet projects. Passed when they still had control of both houses of Congress and the White House. And a delicious crisis. For as Rahm Emanuel said, “Never let a serious crisis go to waste. What I mean by that is it’s an opportunity to do things you couldn’t do before.”
Sure, they’ve always hidden things in bills before. But rarely does $800 billion of free spending come along. They weren’t going to attach this pork to a bill. This pork was the bill. And it included a little bit of everything. Including green energy. Green Chip Stocks list this spending on their website:
- $2.5 billion for energy efficiency and renewable energy research
- $1 billion energy efficiency programs including energy-efficient appliances and trucks and buses that run on alternative fuel
- $4.5 billion to boost the energy efficiency of federal buildings
- $6.3 billion for energy efficiency and conservation grants
- $5 billion to weatherize old buildings
- $2.3 billion in tax credits for energy efficiency technology manufacturers
Last time I looked ‘research’ was not a ‘shovel ready’ project. Neither are alternative fuel programs. Or federal renovation projects. Or the government granting process. (It takes forever and a day for construction projects to start when there is federal money involved.) And tax credits only help a few people work so they can build things that won’t sell at market prices.
Again, not stimulus. But pork. Earmarks. Despite everything they told us. They weren’t going to create jobs and fix the economy. They were settling their political accounts.
Democrats took Advantage of a Crisis to sneak Pet Projects into Law
This shameless Democrat spending spree (remember what Nancy Pelosi said – “We won the election. We wrote the bill”) helped to push the deficit into record territory. Which caused S&P to downgrade our credit. All because the Democrats took advantage of a crisis to sneak a lot of their pet projects into law.
It just goes to show you that you shouldn’t trust politicians. And, based on the American Recovery and Reinvestment Act of 2009, you should especially not trust Democrats. For they are quite sneaky. And often don’t do as they say. For the stimulus bill wasn’t going to have any pork or earmarks. But in reality about 88% of the bill was nothing but pork and earmarks. Which is a lot more than none.
Tags: bill, create jobs, Democrat, Democrat pet projects, dishonest politician, Earmarks, fix the economy, government spending, government subsidies, high-speed rail, infrastructure jobs, jobs, legislation, politician, pork, shovel-ready, sneaky legislation, stimulus, stimulus bill, teachers' unions, union dues, union teachers
GOVERNMENT FIXES PROBLEMS. Or so they say. And the people think. When something isn’t right in the country, the people demand that government do something about it. And politicians are more than happy to oblige. It strokes their egos. Increases their budgets. Their staffs. And they get to do what they like best. Tell others what to do. Well, that, and spend money.
Politicians are happiest when government grows. Because when it does, there’s more stuff to do. More people to manage. Bigger offices to move into. More people to hire. And the more they hire, the more people are indebted to them. Who love them. Respect them. Are in awe of them. Which inflates their egos even more. As if that was even possible. And, of course, there’s more money to spend.
As government grows, so does their job security. I mean, there may come the day that the good people may not reelect them. As devastating as that may be, they can be comforted in the fact that they will leave Washington far richer than they were upon entering Washington. And there’ll always be a place for them in an ever expanding government. A cabinet position. An agency position. Or, perhaps, they’ll be named a czar. Of something. In charge of a policy issue. Away from the oversight powers of Congress. Anything is possible. As long as government grows. And there is more money to spend.
And just why is that? Why does government continue to grow? Simple. They don’t fix problems. They’re always ‘fixing’ problems. But they’re never fixed. They’re always a work in progress. Because a fixed problem doesn’t require their services any longer.
DON’T THINK SO? Suppose the government gives you a federal job. An important one. You’re in charge of the Office of Getting People to Happily Accept the Banning of Smoking in Public Places. They give you a big office. A staff. A budget. And a title. You feel pretty good. Important. You diligently go about your work. You take polls. You analyze data. You place public service announcements. You intensify your polling before and after local laws are implemented banning smoking in public places.
You analyze your data. You correlate satisfaction with dissatisfaction. Pacification with irritability. Your numbers look good. As more and more localities ban smoking from most public spaces the more your numbers show that the satisfaction/dissatisfaction ratio is trending favorably. The trending is flatter with pacification/irritability but the trending is still favorable. You conclude that these new laws come in, on average, at 9.875. And that’s very good on the scale you created to measure overall effectiveness and acceptance of new laws to influence social behavior. You happily report your findings to your superior.
“What are you,” your superior asks, “stupid? Trying to put yourself out of a job? Are you trying to cut my budget? Because that’s exactly what’s going to happen if you turn in a report like this. Now here’s what you’re going to do. You’re going to report that your findings indicate some improvements in some select demographics. But overall there is still much work to do. Then write up a proposal for additional work required and throw in a budget that increases your current budget by 12%. For starters. Then I’ll critique your findings and find your funding request insufficient because of a mistake you made in your analysis. Have it on my desk by the end of the week.”
Sound ridiculous? That’s probably because it is. And probably all too true. I mean, how many federal programs do politicians shut down because they were successful in achieving their objective? I think few. If any. Because no one wants to put themselves out of a job. Especially a federal job. Because there’s no job like a federal job. At least, not in the private sector.
IN THE PRIVATE sector, your work has to have value. When people are voluntarily paying for goods or services, you can’t have fat payrolls and fat budgets to produce goods and services no one wants. You can only do that when government pays. And by government I mean you and me. With our taxes. Which we have little choice but to pay. For we are forced to under penalty of law. Which can be pretty persuasive in making you pay for stuff you don’t want. For we wouldn’t normally give away our hard-earned pay for the ridiculous wastes of resources known as government work. To make the lives of federal workers better than ours. And speaking of federal workers, what’s that joke? Question: What is federal work? Answer: Work for the unemployable. There’s a lot of truth in that. For a lot of these people couldn’t make it in the private sector. And if they had to, they would only do so with the utmost bitter resentment. They’d resent the longer hours. The huge cut in pay. The huge cut in benefits. And the accountability.
You see, in the private sector, failure has consequences. People get fired. If a business is losing money because of silly projects they’re pursuing, the board of directors will fire the corporate officers. If it’s a small business, the owner may lose his or her life savings. And their house (which is often mortgaged up to the hilt to support their business). There will be change after failure. And it will be painful to many. Unfeeling. Cold. But necessary. But it’s different in government.
When politicians fail, they reward themselves. When their policies fail, the politicians simply say they need more time to make those policies work. And more money. That’s always the answer. And they get away with it. More money. Keep throwing money at the problem. No matter what a train wreck their programs turn out to be. Or what the unintended consequences are.
POLITICIANS LIKE TO tinker. Often in things they shouldn’t. Because when they do, bad things often happen. Those unintended consequences. For when it comes down to it, they’re not very smart. They could have graduated from their Ivy League schools at the top of their class, but they often know squat about the things they’re meddling in. Most of them are lawyers. And what does a lawyer know about economics? Foreign policy? National security? Bupkis. But it never stops them.
And it doesn’t even matter. Because their motives were honorable. They acted with the best of intentions. At least, that’s what they say. As do their supporters. And when everything goes to hell in a handbasket, they don’t mind. Just more problems for government to fix. More programs. More staff. And more money to spend.
Of course, we ultimately pay the price for their actions. Whether it’s recession, depression or a more dangerous world to live in. Which is often the case. More times than not.
EVER WONDER WHY everything is a crisis? Because a crisis needs urgent action. By politicians in Washington. And that urgent action is typically vast new government programs with an exploding federal bureaucracy. Along with explosive federal spending. And because it’s a crisis, there’s no time to lose. If we don’t take immediate action the consequences could be dire. There’s no time for debate. For opposition. To read a bill. No. We have to act and we have to act NOW. Before this crisis gets any worse.
And when things do get worse after we take all that urgent action, you know what they’ll say? That they were wrong? Yeah, right. In some fantasy world maybe. No. Instead, they’ll say just imagine how bad things would have been if they didn’t act like they did. That we should be thankful things are only as bad as they are, for they could have been a whole lot worse if government didn’t act. Why, they’ll be patting themselves on the back. While you suffer more.
Hard to fight that logic. I mean, they can say anything. If their action takes unemployment to record levels, they can say unemployment would have been twice as high if they didn’t do what they did. Twice as high would be worse. But how do they know it would have been twice as high? How can they prove it? Well, they don’t have to. Because you can’t disprove it. And those who gamble know that a tie goes to the house. So they’re right. Because you can’t prove otherwise. So they act accordingly. And their supporters go along. And the answer to the new problems that are worse than the original problems? You guessed it. More of the same. More government programs. More government spending. At least, that’s what the historical record shows.
POLITICIANS LOVE FAILURE. They thrive on it. It gives them life. Success, on the other hand, destroys them. Removes their raison d’être. Their reason for being. A prospering nation, after all, doesn’t need government to fix anything. And that’s no good. Especially if that’s the business you’re in. Fixing things. Fixers need to fix. But it needs to remain a work in progress. So there’s still fixing to do. Always. And forever.
And they’ll never let a good crisis go to waste.
Tags: accountability, agency position, analysis, benefits, Big Government, bill, board of directors, budgets, Business, cabinet position, Congress, consequences, corporate officers, crisis, czar, debate, demographics, depression, Economics, effectiveness, expanding government, failure, federal bureaucracy, federal job, federal programs, federal spending, foreign policy, goods or services, government programs, government work, issue, Ivy League, job security, laws, lawyers, life savings, more dangerous world, mortgaged up to the hilt, national security, never let a good crisis go to waste, opposition, oversight, payrolls, policy, politicians, private sector, prospering nation, recession, small business, smoking, social behavior, spend money, taxes, throwing money at the problem, train wreck, unemployable, unemployment, unintended consequences, urgent action, value, Washington