Cost of Health Care Law Is Seen as Decreasing

See on Scoop.itDidYouCheckFirst

A slowing trend in health care spending has lowered the law’s price by billions, and future cost controls may save billions more.

Greg Russak‘s insight:

"Already, the Congressional Budget Office has quietly erased hundreds of billions of dollars from its projections. It now estimates that Medicare spending in 2020 will be $137 billion lower than it thought in 2010, a drop of 15 percent; Medicaid spending will be $85 billion, or 16 percent, lower; and private health insurance premiums are expected to be about 9 percent lower.

Some economists say they believe that the Congressional Budget Office might be underestimating the long-term effect of the slowdown, because it expects that spending growth will eventually return to its previous trend line. David M. Cutler, a Harvard economist and former Obama adviser, cautiously suggests that the slower growth might stick around, and if so the savings for the government might be a whopping $750 billion over 10 years, he says.

 

Whether such improvements will last depends on whether private firms — nudged along by Washington — create and retain incentives to keep spending low."

See on www.nytimes.com

Republican Voters: You’re Shutting Down Yourselves and Your Neighbors

UncleSamWantsYou

Whether shutting it down temporarily or shrinking the government permanently, the facts are that doing so tends to hurt the people in Republican states more than other states and to greater degrees than Republican voters seem to realize or are willing to admit.

On Friday, September 27th, The New York Times published Off the Charts: Big Government States. The charts don’t lie, and the opening statement sums it up:

States with a larger government presence — as measured by either employment or economic impact — tended to vote Republican in the 2012 election, while states with a smaller government presence tended to vote Democratic.

It begs a couple of questions.

Do Republican voters understand that they are more often the greater beneficiaries of direct government employment? They and their neighbors are more likely to actually work for the government. When the government shuts down or shrinks, that hurts their neighbors and the economy in the same way that a layoff or business shutdown in their community does.

That’s the direct employment part. How about government spending?

Do our Republican family and friends not understand that the only true “trickle down economics” comes *FROM* government spending? Government agencies not only employ our fellow Americans, the government also spends money through private businesses. That spending creates private sector jobs and prosperity for themselves, their communities, their families, and their neighbors.

The state G.D.P. figures may well understate the importance of — and the decline in — government activity. That is because they are computed differently from the national G.D.P. number. The national number is based on spending, while the state numbers are based on profits and income of workers. As a result, if a government pays for the construction of something, whether a school or a fighter jet, that will show up as government activity in the national figure.

But for the state figures, it will show up as private-sector activity because the work was done by employees of construction or aerospace companies.

(http://www.nytimes.com/2013/09/28/business/the-most-republican-states-tend-to-rely-more-on-government-jobs.html)

Doesn’t that mean the government is a legitimate job creator? After all, who else is going to place orders with private companies for fighter jets, roads, bridges, and schools, not to mention the $517billion spent on outsourcing?

All of this adds up to a mystery.

Why do some middle class Americans insist on voting against their own economic self-interests? It makes absolutely no sense. For that kind of voting to be even more common in states where the economy is even more dependent on government makes even less sense.

Let’s not shy away from this fact, either. It is only Republican legislators who want to shrink government to the point that they can drown it in the bath. Middle class Americans who vote for them are voting to commit economic suicide.

FDR had this to say in his famous “I welcome their hatred” speech in 1936. It’s just as true today as it was back then.

The very employers and politicians and publishers who talk most loudly of class antagonism and the destruction of the American system now undermine that system by this attempt to coerce the votes of the wage earners of this country. It is the 1936 version of the old threat to close down the factory or the office if a particular candidate does not win. It is an old strategy of tyrants to delude their victims into fighting their battles for them. (http://docs.fdrlibrary.marist.edu/od2ndst.html)

Let’s hope that our Republican friends, family members, neighbors, and strangers will come to their senses soon and stop allowing themselves to be deluded by the tyrants of their party.

The Real IRS Scandal

See on Scoop.itDidYouCheckFirst

Yesterday, in response to recent IRS admissions, President Obama called the enhanced investigation of conservative groups seeking tax-exempt status “intolerable and inexcusable.” And, Attorney General Eric Holder announced a criminal investigation…

Greg Russak‘s insight:

"The IRS shouldn’t be apologizing for investigating phony “non-profit” organizations, they should be investigating all politically-motivated groups who want to be subsidized by the tax payers." – Thom Hartmann

See on www.thomhartmann.com

The Economics and Patriotism of Infrastructure Jobs Programs

Infrastructure map courtesy of The Atlantic

The Economics and Patriotism of Infrastructure Jobs Programs

America’s crumbling infrastructure is both a safety hazard and a drag on our economy that is projected to only get worse. If we’re going to tackle the really big challenges of government budgets, deficits, debts, and the economy, then every citizen must understand the realities of what a deteriorating infrastructure means to this country. We then need to demand that our elected leaders stand strong against austerity and, instead, do whatever it takes – including raising taxes on corporations and the wealthy – to improve our infrastructure.

Properly-funded federal and state infrastructure improvement jobs programs would produce immediate and lasting benefits, including but not limited to:

1) Putting large numbers of Americans back to work in good paying middle class jobs which would immediately boost the economy from the bottom up (since trickledown economics has proven to, once again, be an unmitigated and disastrous failure)

2) Making all of us safer and less vulnerable to infrastructure inefficiencies, failures, or acts of terrorism

3) Demonstrating to American companies and to the world a sense of patriotism that includes spending public funds on the infrastructure that is so vital to our economic and commercial success

Putting patriotism and safety issues aside for the moment (although I don’t know why we should), the sheer impact to our economy and our own selfish financial interests are at stake. This is usually motivation enough for most Americans to demand action from our politicians.

I think it ought to be more than just self interest. Americans have become the experts at professing their patriotism at every opportunity. We’re known the world over for our self-proclaimed exceptionalism. It’s why I believe that we ought to be thinking about and talking about funding the repair and expansion of our infrastructure as one of the most truly patriotic things we can do for ourselves and our country.

First, the economics. Math, after all, doesn’t require an emotional investment or belief system. It just is.

The Economics of Infrastructure

In his blog post, “Crumbling Infrastructure Has Real and Enduring Costs,” William A. Galston of the Brookings Institution points out that a study by the American Society of Civil Engineers projects that, “…by 2020, if the mounting investment gap in infrastructure is not addressed, ‘the economy is expected to lose almost $1 trillion in business sales, resulting in a loss of 3.5 million jobs . . . the cumulative cost to the U.S. economy will be more than $3.1 trillion in GDP and $1.1 trillion in total trade.'”

He also tells us that the Building America’s Future Educational Fund report reveals that a lack of a national infrastructure plan puts a serious drag on our economy. The example he cites is “…in 2010, Americans spent a total of 4.8 billion hours stuck in traffic, wasting 1.9 billion gallons of fuel, at a total cost of $101 billion.”

Let these numbers sink in.

$1 trillion – that’s a ‘1’ followed by 12 zeros; $1,000,000,000,000 – in LOST BUSINESS SALES and 3.5 million lost jobs in just 7 years.

$101,000,000,000 wasted sitting in traffic in just one year.

So in addition to patriotism and public safety, do we as Americans really want to waste greater and greater amounts of time, energy, and money sitting in traffic or waiting for delayed flights and trains?

Do you want to waste even more of it in the future?

Do you want American businesses to forego realizing ONE TRILLION DOLLARS in sales between now and 2020?

If not, then ask yourself how or why we ought to buy into Paul Ryan’s thinking that what’s needed most right now is greater austerity.

His budget – which unless I’ve missed it still seems to be the GOP’s position, too – proposes we spend $78 billion, or 25% less, on infrastructure than the White House’s proposed budget of $104 billion per year over the next decade. According to Galston and some think tanks, the White House’s budget is already less than one-half of what’s needed to repair our infrastructure, and yet Ryan would have us believe we need to spend even less.

How does that solve the problem? I simply cannot believe there’s that much waste and, true to form, Ryan still is unwilling or unable to offer any substantive details.

So as far as the economics go, one would think that numbers like the lost sales, lost jobs, trade imbalances, and lost productivity would be enough to rally the public *and* the business community to demand that something be done immediately to repair, improve, and expand our infrastructure. It’s not like there aren’t precedents to follow with proven outcomes. We – meaning the government hiring both workers and outside companies as contractors – have done big infrastructure projects before.

It took courageous leadership in government to get those projects moving. The private sector was and still is the beneficiary of that leadership. Where is it now?

No, You Didn’t Build That

With all due respect and admiration for the courage and creativity of entrepreneurs and captains of industry everywhere, I remind you that, “NO, YOU DID NOT BUILD THAT!”

You just get to benefit from it. The nation’s infrastructure is, without question or doubt, part of the reason for any commercial success and, hence, at least part of the resulting wealth that’s made possible in America for those who want to start, run, and work in the private sector. Trust me; I’m your fan and one of your biggest cheerleaders. I just think it’s time that you and your followers put your copy of Atlas Shrugged down and join the rest of us in the real world.

Business people everywhere – from the titans running multinational corporations to the small business owner on Main Street struggling to compete with Walmart – owe it to themselves and their self respect to please stop this self-indulgent and self-serving love affair with the Randian mythology. It’s tedious and tiresome and, truthfully, a complete fantasy. Where would you be if your workers quit tomorrow, and when was the last time you built a bridge, an airport, or an electrical power station?

To the business people busying themselves complaining endlessly about the government, please stop your childish whining and please start acting like real leaders. You can start by acknowledging that if you’re going to continue to benefit from everything a democratic society has to offer – including infrastructure – then you are going to have to pay for it. That’s how capitalism works, right? Payment for goods and services rendered?

Yes, I know that means higher taxes than the historically low taxes you pay now. The only sympathy you’re going to get are from fellow wealthy individuals and the people you’ve duped into believing in another fantasy – trickle-down economics.

Look, if your business cannot survive an increase in taxes and the closing of loopholes, well then maybe you’re not such a successful business person after all. Don’t feel bad. Lots of people have tried and failed more than once, including yours truly. It’s what makes me your cheerleader. I know how hard it is. We both know that there are no guarantees, but I will say this; never once did tax obligations figure into my thinking or have any impact on my results.

Real entrepreneurs don’t let things like taxes get in their way; they don’t use them as a lame excuse for not trying, nor are they the cause for why one tries and fails. Only someone who has never started a business would believe such a thing.

It’s only in bad novels by Russians with absolutely no economic credentials where real entrepreneurs give up and disappear because they were somehow defeated by government or society.

To the average citizens who rises in Randian defense of all things private and corporate, including infrastructure, I’d like to ask you a few questions.

How well do you feel you understand the profit motive and the demands it places on the business managers to maximize revenues and minimize expenses?

Have you really thought through what it would be like living in a country where every other river crossing or highway exit extracts a toll from us that goes only to a corporation and their shareholders?

If you have thought about it and you do want to see infrastructure privatized, then I would like to hear how and why you believe that the corporation collecting your tolls will forego maximizing profits and, instead, do what’s best for the nation and for the local community once they’ve built their monopolies modeled on Matty Moroun and his Ambassador Bridge?

It all comes down to money, of course, and, like it or not, it takes money to fund a democracy.

So here we are. We’ve arrived at a point in our political and societal evolution where, hyperbole and ignorance of the facts notwithstanding, American corporations, wealthy individuals, and their toadies in the GOP continue to foist upon us their strategy of fear, uncertainty, and doubt – along with unhealthy doses of outright lies – to keep us at bay and living in fear that they’ll abandon our shores if they can’t keep – and even reduce further – their already historically low tax obligations when they do pay any taxes at all. (Yes, I’m looking at you Mitt Romney, GE, and the rest of you uber-rich individuals and corporations paying very little taxes or actually getting tax refunds.)

The message from Big Money America and the GOP is clear: they are completely and utterly devoid of care or concern for this country and its citizens outside the now well-known 2%.

Where’s The Patriotism?

Galston reminds us that we’ve pulled together as a nation under both Democratic and Republican administrations before to do big infrastructure projects. We’ve done what’s been needed before. We can do it again.

A federal (and state) infrastructure program now would put lots of people to work. In addition to safer and more efficient infrastructure, big and bold new projects – hell, even repair and rehabilitation projects – would mean lots of decent paying middle class jobs for Americans. That is exactly what is needed right now to get the economy growing faster and better. What we don’t need and can’t afford is more austerity and more of our fellow citizens left with little choice or opportunity outside of working in retail or the fast food industry.

We need a sense of patriotism.

Federal infrastructure projects are patriotic and need to be talked about as patriotic. They are physical and enduring evidence of the love and devotion we should have to our country and to each other. Our society simply cannot operate without infrastructure, so programs to repair and improve it is service to our country, isn’t it?

Since the days of the Erie Canal, infrastructure projects have proven to deliver huge economic and societal benefits both at the time they are undertaken and for generations to come. We Americans need to remember this every time we merge onto an interstate, get on a train, board an airplane, turn on our lights, or buy bananas in January. None of that is possible without infrastructure, and that infrastructure was built by Americans for Americans.

Our roads, airports, railways, and sea ports have become too small, too old, and crumbling too quickly after decades of use for us to stand by and let it happen. They’re more and more unsafe and, for all the true capitalists out there, it’s a drag on our economic vitality and growth that will only get worse unless we do something about it.

And when it comes to defining what it means to be an American, letting our infrastructure deteriorate turns us into a second-rate first-world nation. It’s an embarrassment and a shame on all of us. We’re always making lots of noise about being number 1. I don’t know about you, but I never hear any Americans proudly proclaiming, “We’re #33!”

It’s time to show some real patriotism outside of military excursions. It’s time for Americans to rally together to demand that our elected officials put us to work fixing and rebuilding America’s infrastructure.

It’s good for us citizens. It’s good for business. It’s good for America.

Sounds like patriotism to me.

Sources:

(1) Galston, W. (2013, January 23). Crumbling Infrastructure Has Real and Enduring Costs. http://www.brookings.edu/blogs/up-front/posts/2013/01/23-crumbling-infrastructure-galston?cid=em_alert012813

(2) Plumer, B. (2012, March 30). What Paul Ryan’s budget actually cuts – and by how much. http://www.washingtonpost.com/blogs/wonkblog/post/what-paul-ryans-budget-actually-cuts–and-by-how-much/2012/03/20/gIQAL43vPS_blog.html

(3) Berfield, S. (2012, May 3). Matty Mouron, Detroit’s Border Baron. http://www.businessweek.com/articles/2012-05-03/matty-moroun-detroits-border-baron

How I Solved the Debt Crisis

How I got the U.S. to an acceptable debt level at http://crfb.org/stabilizethedebt/. My selections are in bold below.

Iraq and Afghanistan

Reduce Troops to 60,000 by 2015
-$350B

Reduce Troops to 30,000 by 2013
-$740B
Maintain Current Funding Levels
$0

2001/2003 Tax Cuts
Renew All the Tax Cuts
$3,280B
Renew the Tax Cuts on Income Below $250k/200k
$2,590B
Reduce Lower Rate Cuts by Half and Let Upper-Income Cuts Expire
$2,060B
Allow All the Tax Cuts, Except for AMT Patches, to Expire
$480

Discretionary Spending Growth
Grow Regular Discretionary Spending with GDP
$1,290B
Adopt the Discretionary Spending Growth Rates in the President’s Budget
$680B
Grow Regular Discretionary Spending with Inflation
$0

Defense, Diplomacy & Security
Enact Administration’s Proposed Weapon System Cuts
-$30B

Foreign Aid
Cut Foreign Economic Aid in Half
-$110B

Increase Foreign Economic Aid by 50%
$110B

Veterans’ Benefits
Reduce Veteran’s Income Security Benefits
-$50B
Expand Veteran’s Income Security Benefits
$30B

Cancel Missile Defense System
-$50B

Reduce Spending on Ship Building
-$50B

Increase Homeland Security Spending
$50B

Troop Levels
Increase Number of troops by 46,000
$70B
Reverse “Grow the Army” Initiative
-$90B

Domestic Social & Economic Spending
Cancel TARP and Rescind Unused ARRA Funds
-$350B

Enact New Jobs Bill
$210B

Food Stamps
Gradually Reduce Benefits to 2008 Levels
-$100B
Index Current (Post-Stimulus) Benefits to GDP
$140B

Freeze Average Unemployment Benefits at 2009 Levels
-$50B
Cut Temporary Assistance to Needy Families (TANF) Program
-$50B
Cut Federal Funding of K-12 Education by 25%
-$60
Eliminate the New Markets Tax Credit
-$40B
Cut School Breakfast Programs
-$30
Double Funding on Adoption and Foster Care
$70B
Increase Funding for the Education of Disadvantaged and Disabled Children
$290

Social Security
Raise the Normal Retirement Age to 68
-$110B

Slow Initial Benefit Growth
Gradually Reduce Scheduled Benefits (by 30% in 2080)
-$100B

Progressively Reduce Benefits, Protecting Low Earners
-$80B
Progressively Reduce Benefits, Protecting Low and Medium Earners
-$60B
Use An Alternate Measure of Inflation for COLAs
-$100B

Reduce Spousal Benefits from 50% to 33%
-$20B
Increase Years Used to Calculate Benefits
-$40B
Include all New State and Local Workers
-$80B
Institute a Minimum Benefit
$130B

Health Care
Modify Health Care Reform Law

Expand Coverage to an Additional 5 Million People
$130B
Reduce Insurance Subsidies by 20%
-$160B
Repeal Entire Legislation
$160B
Repeal Legislation, but Keep Medicare/Medicaid Cuts
-$260B
Increase Cost-Sharing for Medicare
-$100B
Raise Medicare Premiums to 35% of Costs
-$140B
Reduce Spending on Graduate Medical Education
-$20B
Enact Medical Malpractice Reform
-$50B
Increase the Medicare Retirement Age to 67
-$80B
Replace Traditional Medicare with Insurance Vouchers
-$120B
Modify Federal Medicaid Funding to States

Reduce Funding Removing Floor on Matches
-$130B
Increase Average Matches from 57% to 60%
$140B

Other Spending
Eliminate Certain Outdated Programs
-$40B
Reduce Federal Highway Funding
-$70B
Reduce or Eliminate Certain Transportation Programs
-$20B
Cut Federal Workforce by Five Percent
-$130B
Cancel NASA Missions to the Moon and Mars
-$40B
Reduce Farm Subsidies
-$80B
Expand Spending on Federal Research & Development
$100
Cut Earmarks in Half
-$80B

Increase Mass Transit Funding
$60B

Revenues
Increase User Fees Across the Board
-$40B
Sell Certain Government Assets
-$70B
Impose Financial Crisis Responsibility Fee
-$80B
Reform International Tax System
-$120B
Enact Carbon Tax or Cap-and-Trade
-$330B
Increase Gas Tax by 10 Cents per Gallon
-$80B
Enact Five percent VAT With Partial Rebate
-$630B

Gradually Increase Dependent Exemption by $3,500
$190B
Impose Surtax on Income above $1 million
-$190B
Gradually Increase Payroll Tax by One Percentage Point
-$130B

Raise Social Security Payroll Tax Cap
Raise Cap to Cover 90% of Earnings
-$420B

Institute Two Percent Surtax on Earnings Above Cap
-$190B
Reduce Corporate Tax Rate from 35% to 30%
$390B
Index Tax Code to Alternate Measure of Inflation
-$80B
Improve Tax Collection (Reduce Tax Gap)
-$20B

Tax Expenditures
Convert Mortgage Interest Deduction to a 20% Credit
-$190B
Limit Itemized Deductions for High-Earners
-$250B
Curtail State and Local Tax Deduction
-$470B
Eliminate Life Insurance Tax Benefits
-$220B

Eliminate Subsidies for Biofuels
-$110B
Make Research & Development Tax Credit Permanent
$80B
Extend $400/person Making Work Pay Credit
-$400B

Tax Credits for Children and Families
Cut the Earned Income Tax Credit (EITC)
-$70B
Expand the EITC and Child Tax Credit
$90B
Extend “American Opportunity” College Tax Credit
$60B

Tax Treatment of Employer Sponsored Health Insurance
Begin Excise Tax on High-Cost Plans in 2013 Instead of 2018
-$110B

Repeal Excise Tax on High-Cost Plans
$10B
Replace Employer Health Care Exclusion with a Flat Credit (In Place of Excise Tax)
-$340B