“Everyone agrees that the recession is over.” - Larry Summers, director of the National Economic Council
“Of course not.” – Outgoing Council of Economic Advisers Chairwoman Christina Romer, when asked if the recession was over.
The two senior White House economic advisers made their comments on the same day.
From Think Progress -
Paul Ryan says he has a plan to balance the budget. He’s been saying this for months, and his proposals have been scrutinized by experts. So I see two possibilities. One is that Paul Ryan’s plan would balance the budget. The other is that Paul Ryan is dishonest. And yet while it’s uncontroversial among wonky center and center-left types in Washington DC that Ryan’s would not balance the budget, it remains bizarrely controversial whether he deserves a reputation for honesty.
Paul Krugman, standing up for common sense and citing a Tax Policy Center analysis of Ryan’s proposals says he is not honest. The Tax Policy Center, however, is standing up for Ryan before conceding the substance of his point:
TPC did analyze Ryan’s tax-specific proposals and found they would fall short of this revenue goal. For example, Ryan’s proposal would lead to federal tax revenue of approximately 16 percent of GDP, which amounts to a $4 trillion revenue shortfall over ten years compared to the alternative fiscal scenario. But that doesn’t mean that Ryan’s plan is a fraud. Instead, it shows that Ryan’s vision of broad-based tax reform, which essentially would shift us toward a consumption tax, needs to be adjusted in order to meet his stated goal of matching historical levels of revenue as a proportion of GDP. This indeed poses a challenge to Congressman Ryan to make specific changes to his tax reform plan in order to meet his revenue goal.
For Ryan’s plan to work, he needs 19 percent of GDP, which is what he claims to have. The Tax Policy Center pointed out months ago that he has 16, not 19. And Ryan hasn’t offered any new ideas. Instead, he’s still walking around DC dining out on his reputation for honesty and bold thinking. But to offer an honest plan to balance the budget your plan needs to balance the budget. I don’t really understand why this has become the subject of dispute. It seems to me that the 90 percent of members of congress who don’t claim to have a 70-year budget plan are the honest ones. For one thing, they’re not lying! For another thing, why do we even care about Paul Ryan’s plan to balance the budget in 2080? Ryan will almost certainly be dead in 2080. But of course maybe by 2080 we’ll all be disembodied immortals, with our consciousnesses downloaded into computers. It’s bizarre to make (pretending to) tackle this pseudo-issue the prime criterion for serious policy thinking.
Late last month, Gov. Chris Christie (R-NJ) followed through on his threat to veto a millionaire’s tax passed by the state legislature. The bill would have implemented a surcharge on income above $1 million, raising $635 million to fund property tax relief for senior citizens and the disabled (among other programs).
New Jersey Democrats are planning to hold a vote to override Christie’s veto today, but lockstep opposition from the state’s Republicans is rendering success unlikely. As the Newark Star-Ledger reported, “Republican leaders have vowed not a single GOP vote will flip.”
The end result of Christie’s veto, if it is not overridden, will be to increase taxes on seniors while cutting them for the wealthy. In fact, according to the state’s nonpartisan Office of Legislative Services, “a retired couple living on a fixed income of $40,000 would see an increase of $1,320 in taxes under the governor’s plan while a family making $1.2 million would receive a tax cut of $11,598.”
As Citizens for Tax Justice added, “there is glaring hypocrisy in Christie using his anti-tax pledge to justify his veto of the millionaire’s tax”:
While Christie has no appetite for tax increases on the wealthiest New Jerseyans, he continues to support a reduction in the Earned Income Tax Credit (EITC) for hard-working low-income taxpayers (which amounts to a tax increase) and increases in fees in addition to his proposed suspension of property tax rebates for older adults and the disabled. And, his more than $1.2 billion cuts in aid to local governments and school districts will more than likely force local leaders to increase property taxes — the very taxes he claims he wants to “control”.
“New Jerseyans are going to need a thesaurus to decipher all the ways Governor Christie’s administration is trying to insist their budget plan doesn’t increase taxes on senior citizens and working-class New Jerseyans,” said state Rep. Gordon Johnson (D-Englewood). “Call them what they may, this budget would mean this simple fact — senior citizens, the middle class and the poor are about to pay significantly more while the wealthy enjoy a nice tax cut.”
New Jersey is facing a $10.7 billion budget deficit, which, at 37.4 percent of the current year’s budget, is the second-highest in the country behind Nevada. But failing to accept the millionaire tax is not the only way in which Christie is mucking up his state’s tax policy. He has also proposed a cap on property taxes which, if implemented, would lead to massive cuts in funding for education and other vital services, according to the Center on Budget and Policy Priorities.
Another GOPer saying screw the poor and disadvantaged.
In their infinite wisdom, the GOP, with the help of Democrat Ben Nelson, has once again voted against the (H.R.4213) – American Jobs and Closing Tax Loopholes Act of 2010, more commonly known as the tax extenders unemployment bill.
This finally has bought about much criticism from the left, the White House, and the blogosphere.
House Speaker Nancy Pelosi (D-Calif.) on Thursday twice ripped Senate Republicans for blocking legislation containing extended unemployment benefits.
Gibbs’ office e-mails this statement:
Statement by the Press Secretary on Republican Obstruction of Jobless Benefits and State Aid
Today, Republicans in the Senate for the second time blocked a bill that includes critical aid for states and American families. This legislation extends benefits for Americans looking for work and would save the jobs of thousands of teachers, firefighters and police officers by providing relief to states struggling with budget shortfalls. And it includes tax cuts for businesses that keep research and development jobs here in the United States. By blocking an up or down vote on this legislation, Republicans in the Senate obstructed a common-sense package that would save jobs, extend tax cuts for businesses and provide relief for American families who have suffered through the worst economic downfall since the Great Depression, even after Democrats offered multiple compromises to gain Republican support for the bill. The President has been clear: Americans should not fall victim to Republican obstruction at a time of great economic challenge for our nation’s families. The President will continue to press Congress to pass this bill and bring this relief that’s critical to our economic recovery.
Senate Democrats on Thursday failed for a third time to advance legislation to extend unemployment benefits through November.
The 57-41 vote rejected ending debate on the legislation, which would have sent the bill to a final vote.
No Republicans voted yes, while Sen. Ben Nelson (D-Neb.), who had also rejected earlier versions of the legislation, voted no. Sen. Joe Lieberman (I-Conn.) voted yes after voting on previous procedural motions. Sens. Robert Byrd (D-W.Va.) and Lisa Murkowski (R-Alaska) were absent.
After the vote, Senate Majority Leader Harry Reid (D-Nev.) repeated comments he made earlier Thursday that the Senate will now move to a small-business bill. Reid said the unemployment benefits would not be added to that bill, but others have speculated that the provisions could still be attached to the small-business measure.
The failure to move the tax extenders package, which also would have renewed scores of individual and business tax breaks, illustrates the extent to which fears about the deficit are dominating the legislative process five months before a midterm election in which Democratic control of Congress will be on the line.
The legislation cost about $100 billion and would have added roughly $33 billion to the deficit by extending unemployment benefits for six months. The cost of the added unemployment insurance was not offset with other tax hikes or spending cuts.
Hundreds of thousands of unemployed Americans will lose their benefits because of the GOP Senate. The Senate Republicans held together to block cloture on the jobs bill.
The vote was 57 – 41. Olympia Snowe and Susan Collins sided with Mitch McConnell’s over their constituents in Maine. Of course they did. All the other GOPers voted no, too. As did Ben Nelson.
The Republicans created the economic crisis. Families across the country are suffering. Really suffering. But, the GOPers have decided those families don’t matter.
That really is how the GOP governs. Sell out to Big Oil and Wall Street. Screw over the unemployed.
Today on a press call with bloggers, in response to the impending Republican filibuster of the jobs bill, Senator Debbie Stabenow of Michigan said that Senate Republicans “want the economy to fail.” She additionally said that it was the most cynical political move she has ever seen, likely because Republicans stand to gain from the economic pain they will cause.
Senator Stabenow also said that the moderate Republicans she was negotiating with–such as Susan Collins, Olympia Snowe, and Scott Brown–were negotiating in bad faith. Democrats satisfied all of their concerns, Stabenow said, but “they kept changing what the concerns were.”
Sounding extremely frustrated, Stabenow said that “we have no choice but to move on,” and drop the bill. The votes simply are not there for it right now, and other legislation needs to be addressed. She did urge calls to Senators as a last ditch attempt to pass the bill.
When asked if using the reconciliation process was a possibility, Stabenow noted that would require the Senate to pass a budget resolution that contained reconciliation instructions. And, she noted, all of that would take quite a bit of time, and face obstruction of its own.
When asked if Democrats should employ the nuclear option in response to this bad faith negotiating, Senator Stabenow said they are still looking at changing the Senate rules at the start of 2011, not right now.
Finally, Senator Stabenow noted that the White House had been involved in the negotiations, and were forcefully advocating to get the bill done.
In light of the very likely failure of the tax extenders bill, Steve Benen speculates:
It’s unpleasant to think about, and I really hope it’s not true, but it may be time for a discussion about whether GOP lawmakers are trying to deliberately sabotage the economy to help their midterm election strategy. After all, these same Republicans have supported deficit-financed tax-extenders before — there’s no credible reason to change course now. On the contrary, with the economy struggling to break through, the need for this package is more obvious, not less, if your goal is to actually improve economic conditions.
Losing this bill definitely would sabotage the economy. Estimates of additional jobs lost without the key funding in this bill ranger from 200,000 to 900,000. Because of the loss to state budgets, those will be jobs that will be particularly obvious–teacher, police, firefighters. Lost jobs that will infuriate the public and maybe, just maybe, help the Republicans if there’s an anti-incumbent wave because of it.
Of course, Republicans can’t kill this on their own. Not with
4941 votes. On the last vote they had both Ben Nelson and Joe Lieberman. And if they do kill it with a failed loture vote, it’s completely dead. There isn’t time in the schedule to bring it back up.
So, if you’ve got some time today, call Snowe, Collins, Voinovich, Scott Brown, Ben Nelson, and Lieberman. Here’s a toll free number: 888-254-5087. Ask them if their seats really are worth further wrecking the entire economy.
Everybody’s talking about Senator Debbie Stabenow’s aggressive words today accusing the Republicans of tanking the economy and throwing millions out of work for political gain. I don’t see why this is even slightly controversial. The GOP is a party whose mouthpieces said from the very beginning that they wanted the president to fail and that they were planning his “Waterloo.” And anyone who understood how our government works (or even understands simple logic) knew that saying that in the midst of an economic crisis translates to making people suffer. There was no other way to interpret that so it makes sense.
As expected, the Senate Republican caucus — along with Democrat Ben Nelson (NE) — stood firm today in their opposition to a jobs bill that would have extended the filing deadline on emergency unemployment benefits through November, voting 41-57 to block cloture on the legislation (H.R. 4213). Immediately following the roll call, Minority Leader Mitch McConnell (R-KY) submitted a motion to extend the filing deadline one additional month using a small portion of the funding identified in the bill.
That’s when Illinois’ own Sen. Dick Durbin unloaded on the minority party, suggesting that political posturing, rather than concern about the deficit, is driving their obstruction. “The record is clear: It is a party of no that is hoping that the voters will vote yes in November,” he said. “I hope they remember that the Republicans had no alternative [proposal] when it came to this disastrous economic situation.”
I understand the need for fiscal sanity, too, but at a time of economic crisis — and we’re not out of it yet — punishing the unemployed is hardly the right thing to do. And it really is ridiculous to think that many of the unemployed are living happily off government benefits. Whitehouse continued:
The notion that you’re going to cut off somebody’s unemployment insurance and have them go out and find a job is just plain nuts. There aren’t a lot of people lying around enjoying the luxury of unemployment insurance payments. They want to be getting to work.Welfare is always an “allure,” as Republicans have put it, but it’s also a necessary safety net precisely for times like this. And it’s not just the unemployed who will suffer at the hands of the Republicans. As Arthur Delaney of HuffPo reports:
Democratic leaders in the Senate have apparently failed to win enough support to overcome a Republican filibuster of a bill to help the poor, the old and the jobless, despite making a series of cuts to the measure over the past several weeks to appease deficit hawks.
“It looks like we’re going to come up short,” said a senior Democratic aide on Wednesday evening. “It looks like Republicans are prepared to kill aid to states, an extension of unemployment benefits, and ironically, the Republicans are prepared to kill efforts to close loopholes that allow companies to export jobs overseas.”
The legislation, known as the “tax extenders” bill, would reauthorize extended unemployment benefits for people out of work for six months or longer, would protect doctors from a 21 percent pay cut for seeing Medicare patients, and would provide billions in aid to state Medicaid programs.
Come Friday, 1.2 million people will lose access to the extended unemployment benefits, a number that will grow by several hundred thousand every week after that.As Steve Benen correctly notes, the votes are actually there for the bill. The problem is the filibuster, and the Republicans won’t even let the bill get to the floor for a vote.
A quick list of presidents who wouldn’t have been inaugurated if 57 percent of the vote was insufficient: Barack Obama, George W. Bush, Bill Clinton, George H.W. Bush, Ronald Reagan, Jimmy Carter, Richard Nixon, Lyndon Johnson, John F. Kennedy, Dwight D. Eisenhower, Harry Truman … I could go on.But the tax extender bill failed in the Senate today. It only got 57 percent of the vote. If there’s anything encouraging here, it’s that Olympia Snowe is making noises about a standalone vote for unemployment benefits. But there’s really not much that’s encouraging here, and that’s particularly true if you’re a small business that can’t find a loan, or an unemployed person who can’t find work. As far as the Senate is concerned, the recession is over. The election has begun.
Welfare and unemployment beneficiaries would have to pass a drug test to qualify for programs under an amendment offered Tuesday by Sen. Orrin Hatch (R-Utah).
Hatch introduced an amendment to the tax extenders bill that would require those who are applying for some of the benefits in that bill, including unemployment and welfare benefits, to pass a drug test in exchange for the benefits. “Drugs are a scourge on our society — hurting children, families and communities alike,” Hatch said in a statement. “This amendment is a way to help people get off of drugs to become productive and healthy members of society, while ensuring that valuable taxpayer dollars aren’t wasted.”
Under the Hatch amendment, individuals who fail to qualify for benefits because they failed a drug test wouldn’t necessarily be jailed, but would be enrolled in a state or federal drug treatment program.
Dave Lindorff over at After Downing Street is right on the money..
If you are sitting in class taking a test, and you’ve chosen to sit amongst your bone-headed, slacker friends, don’t turn to them for help when you can’t figure out of any of the answers. They may all tell you the same thing, but they’ll all be wrong.
That’s the situation President Obama finds himself in today in the White House. Having surrounded himself with the very Wall Street con men who set up the crooked game that led to the current financial crisis and economic collapse, and finding that the lousy advice they have been giving him since last January has left the country still mired in deepening economic decline, with the banks still not lending and unemployment still mounting, and with growing signs that instead of bottoming out and starting to recover, the economy is threatening to fall a second time, to new lows and higher unemployment, Obama has turned to the same rotten advisors for answers.
A few days ago, in an interview with Fox-TV while he was in China off all places (a country that has made a stupendous stimulus investment to create domestic jobs!) Obama warned, for the first time, that America faces the possibility of a “double-dip” recession. That’s fine as far as it goes. I agree. But what did he say the risk was? Not that the government has been failing to put significant numbers of people back to work, but that the government keeps piling up deficits.
This has to be the lamest economic thinking since Herbert Hoover started tightening the screws on government spending at the onset of the Great Depression in 1930.
Clearly the American government needs to do just the opposite of worrying about deficits. The only growth the US economy has seen to date has been the result of government funding—the cash-for-clunkers program gave a brief restoration of pulse to the auto industry, and the $8000 tax credit for buying a first home kicked up home sales briefly. We know this because when the clunkers program ended, auto sales crashed, and when the deadline approached for the end to the new home tax credit, home building plunged almost 11%. The hundreds of billions of dollars poured into so-called “shovel-ready” state and local projects like roads, schools, etc., may have added or saved as much as a million jobs, but the economy lost many times that many jobs over the same period.
The problem with these stimulus programs is that they are inefficient ways to create jobs or preserve jobs. If roughly one million jobs were created through the stimulus spending of say $200 billion (assuming that the February $800-billion stimulus program, to mollify Republicans, consisted of one-half tax cuts and only one-half actual federal spending, and that this federal spending was spread evenly over a two-year period, that’s $200,000 per job!
If, instead, Obama had chucked the dunces at Treasury and in his Council of Economic Advisors, and instead asked your Labor Secretary to initiate a wide-ranging $200-billion-per-year jobs program, hiring the unemployed at perhaps $20-25,000 per person to do everything from teach in overcrowded urban schools to laying high-speed rail trackbeds, from cleaning up parks to putting insulation in homes, he could have given jobs to close 8 million people—people who would have then spent their money on goods and services and helped rally the economy from the bottom up.
Deficits? Who gives a damn about deficits at this point! The country is up to the gills in debt without creating any jobs. (It’s kind of like my mortgage. Why would I worry about using my credit card to buy food for the week if I was low on cash, when my mortgage has me deep in the red for the next ten years? Obama’s financial advisors, on the evidence, would tell me I should let my family go hungry, because I need to worry about my total debt load.) If you’re worried about deficits, Mr. Obama, end the god-damned wars in Iraq and Afghanistan. It is costing one million dollars a year to send one lousy grunt to Afghanistan or Iraq. And you want to have at least 100,000 guys over there. That’s $100 billion a year right there—enough to hire four million unemployed Americans back here at home!
This president is well on the way to rescuing President Hoover from history’s crap heap by one-upping him in the realm of economic mismanagement. We already have Obamavilles springing up around the country. We haven’t started calling them that, but Naming Day isn’t far off.
At least Hoover didn’t mire the country in another war while the economy was collapsing around him.
President Obama is on a short leash at this point. His fans, and I was one of those who was willing to give him a shot last November, are mostly giving up on him. Activists are already turning on him. My union friends are disgusted. My African-American friends just shake their heads in dismay. Liberal friends act embarrassed. A leftist friend, retired, who devoted a month to campaigning for Obama full time in Pennsylvania last fall now writes angry letters almost weekly to Obama’s former campaign manager David Plouffe and others, blasting Obama’s handling of the bank crisis and his Afghan War plans. Clearly Obama cannot continue to appease Republicans and cater to Blue Dogs in Congress and expect to be re-elected in 2012.
Indeed, if he doesn’t toss the crooks and charlatans in the Fed, the Treasury and his Council of Economic Advisers out, and doesn’t stop listening to the self-serving crazies in the military, he won’t even have a Democratic majority in Congress by the end of next year.
President Obama, aren’t you tired of being an embarrassment to your friends and family? Aren’t you tired of being mocked by your foes?
Come on. We’re sick of your speeches! Suck it up, be a leader.finally and kick some butt. Do something unconventional and daring. End the wars, bring the troops home, announce a huge jobs program, issue an executive order expanding the Medicare program, raise taxes on the wealthy to back where they were in the 1960s, and let’s get the country moving forward again.
Universal Single Payer Health Care Coverage: An Economic Stimulus Plan
By Stephen Lendman
The Institute for Health & Socio-Economic Policy (IHSP) is “non-profit policy and research group and is the exclusive research arm of the California Nurses Association/National Nurses Organizing Committee, (focusing on) current political/economic policy analysis in health care and other Industries….to enhance, promote and defend the quality of life for all.”
In January, it released a “First-of-Its Kind Study” titled, “Single Payer/Medicare for All: An Economic Stimulus Plan for the Nation” to reform the system by providing universal care, adding productive new jobs, billions in public and private revenues, billions more in employee compensation, and added tax revenues. More on that below.
IHSP calls its study an “econometric,” not an “arithmetical” health care system analysis, covering both their costs and economic benefits to the nation. Its methodology drew on:
“widely-used and accessible data bases and econometric models which are capable of showing how changes in one economic variable (such as health demand, pricing of services, or taxation of consumers and employers) will affect not only the health care sectors directly, but also their suppliers….their employees and their households, and the generation of federal, state, and local taxes.”
Elements of its comprehensive coverage include:
- universal eligibility; everybody in, no one excluded;
- everyone under a uniform single standard similar to Medicare Parts A, B, and D; and
- all enrollees having “the same health services, costs, eligibility requirements, and administrative cost burden.
These occur when providers buy services or supplies to deliver care:
- in America, $2.1 trillion in expenditures generates an additional $1.37 trillion in indirect transactions;
- manufacturing with $307.6 billion benefits most; and
- in 2006, health care totaled 9.2% of GDP.
These are health care worker household consumption transactions, and the indirect sector spending their income:
- they total an estimated $2.3 trillion; and
- again, manufacturing benefits most with another $442.8 billion, for an indirect $750.4 billion total.
Total Revenue Generation
IHSP “calculated the economic multiplier to be 2.78, nearly three times the revenues generated within the industry proper.” Total direct and indirect health care revenue is $5.856 trillion.
Tax Revenues Generated
- federal: $538.3 in 2006; and
- state and local: $826 billion.
- 18 million health care workers;
- another 26 million jobs in other industries for a 45 million total; and
- nationwide, “health care value added generated 12.1% of employee compensation, and 10.5% of total employment.”
Health service industries include 511 occupations, 43% in management, administration, finance, physical plant operations, and many other non-health related fields. Registered nurses number about 2.1 million, about 25% of health care professionals. Nursing aides, orderlies, attendants and home health aides comprise another 25%. Doctors are 3% of the total.
Medicare for all, including Part D will generate:
- $317 billion in increased public and private revenues;
- 2.6 million new permanent jobs at an average income of $38,262 annually;
- $100 billion in worker compensation;
- $44 billion in new tax revenue – “exclusive of the funding changes to replace employer insurance contributions;”
- Medicare Part B coverage for 2.6 million Medicare enrollees;
- Part D coverage for 15 million more;
- full coverage for the 50 million or more uninsured and millions more underinsured;
- elimination of the uninsured’s uncompensated demands on providers;
- 27.7 million Medicaid recipients will get the same coverage as others, not the inconsistent kind now offered;
- elimination of $134.9 billion in state and local expenditures and $175.7 billion for the federal government;
- for the privately insured, ending problems of eligibility, exclusions, family coverage, premium costs, high out-of-pocket ones, and likelihood to be uninsured if lose employment;
- for employers, replacing their administrative and financial burden under a shared universal approach;
- for taxpayers, a reduction of $56 billion in unnecessary, unproductive insurance costs; and
- for the nation, joining the rest of the industrialized world that provides universal coverage.
Enhanced Medicare for All
- adding 2.6 million Part A only enrollees and 15 million without Part D will cost about $59 billion, 62% publicly borne;
- the added expense will generate an additional $154.7 billion in total economic activity, about one million new jobs earning $43.2 billion, and new tax revenues of about $21.2 billion.
Covering the Uninsured
For a net total spending increase (net of the eliminated costs for the uninsured) of $44 billion “in 2006 values,” a $120 billion in economic impact will be generated, 945,600 new jobs will be created earning $36.5 billion, and $16.5 billion in taxes will be raised. In addition, the formerly uninsured will pay a small premium above their current expense, but will get greatly enhanced care. Providers will also reduce losses because of non-payments, and emergency rooms will function as intended.
The current system is fragmented, inconsistent, expensive, and fails to provide the full range of preventive and routine care. Discontinuing it at the federal and state levels will generate a “total net direct economic impact” of $16.2 billion dollars breaking down as follows:
- total new expenditures of $88.9 billion; and
- discontinuance of $72.7 billion in costs.
Total economic activity will increase by $43 billion. About 336,900 new jobs will be created generating $14.3 billion annually, and tax revenue increases of $6.3 billion.
Medicare Coverage for the Privately Insured
It will bring 196.1 million new enrollees into the new program, standardize their coverage, replace the above enumerated problems, and eliminate an onerous burden on employers that paid (in 2006) 71% of insurance premiums, or $510 billion annually. Burdensome administrative costs will also be eliminated, an estimated $56 billion.
The net effect will shift an employer obligation to public funding and not increase national health costs. It will require more public administrative capacity, and possibly a new or revised tax structure to replace the current privately-financed system.
An Overview of the Health Care Industry
Providers include hospitals, physicians and other health care professionals, nursing care, home health care, ambulatory health services, laboratories and testing facilities, and others. They’re closely linked to pharmaceutical, medical equipment, and other producers and suppliers.
Employer-provided coverage is the largest funding source. Privately insured households pay deductibles, or co-pays, and often part of the insurance premium. Taxpayers are the second largest funding source, through federal, state, and local health care programs, including Medicare, Medicaid, and others.
IHSP’s report includes a detailed analysis of US health care in 2006, including the composition of the industry, its share of the economy, and the full, direct and indirect, impact that health care activities have on other economic sectors.
IHSP’s study concludes that:
“a comprehensive Medicare based Single Payer system can make significant contributions to access of quality care for all US residents and in the process generate a much needed and very substantial economic stimulus in the form of jobs, enhanced business and public revenues and increased wages for the population at large.” All this for a small net $63 billion increase yielding much more in benefits.
According to Geri Jenkins, co-president of the National Nurses Organizing Committee/California Nurses Association (NNOC/CNA):
IHSP’s analysis shows “for the first time that a single-payer system could not only solve our healthcare crisis, but also substantially contribute to putting America back to work and assisting the economic recovery.”
The study’s lead author and director of the Institute for Health and Socio-Economic Policy (the NNOC/CNA research arm), Don DeMoro, added:
“If we were to expand our present Medicare system to cover all Americans, the economic stimulus alone would create an immense engine that would help drive our national economy for decades to come.”
All for a tiny fraction of the Wall Street bailouts that looted the federal Treasury, gravely harmed the country, and delayed for a future time a far more serious day of reckoning.
Physicians for a National Health Program (PNHP) Support for Universal Single-Payer Coverage
PNHP calls the current system “outrageously expensive, yet inadequate” because of the 50 million or more uninsured and another 30 million or more underinsured. It spends more and delivers less through:
“a patchwork system of for-profit payers. Private insurers necessarily waste health dollars on things (unrelated to care): overhead, underwriting, billing, sales and marketing (plus) huge profits and exorbitant executive pay. Doctors and hospitals must maintain costly administrative staffs to deal with the bureaucracy (consuming nearly one-third) of Americans’ health dollars.” The potential savings from single-payer financing is “more than $350 billion per year….enough to” cover everyone at no more than the current cost and perhaps less depending on services provided and if government negotiates lower drug prices the way other countries do.
Consider the benefits – single-payer will cover “all medically necessary services, including: doctor, hospital, preventive, long-term care, mental health, reproductive health care, dental, vision, prescription drug and medical supply costs. Patients” will have free choice of providers, and doctors will “regain autonomy over patient care,” no longer restricted by insurance company gatekeepers. Overall, health care in America will achieve a quantum leap improvement compared to the dysfuntional state it’s now in, worse still if Obamacare passes.
“HR 3962: Affordable Health Care for America Act” – The Public Betrayal Act to Enrich the Insurance, Drug, and Large Hospital Chain Cartels
On November 7, by a narrow 51 – 49% majority, the House passed legislation former CIGNA executive, now critic, Wendall Potter calls “the Insurance Company Profit Protection and Enhancement Act.” Add the drug and hospital chain cartels that will profit hugely if it’s enacted.
Voting for it – 219 Democrats and one Republican. Against it were the remaining Republicans and 39 Democrats.
Among its supporters were cosponsors of “HR 676: United States National Health Care Act or the Expanded and Improved Medicare for All Act,” including universal single-payer advocates:
- Anthony Weiner (D. NY);
- Danny Davis (D. IL), this writer’s representative;
- Jesse Jackson, Jr. (D. IL);
- Barney Frank (D. MA); and
- Barbara Lee (D. CA).
Dennis Kucinich (D. OH) explained “Why I Voted No,” saying:
The current “for-profit insurance system….makes money (by denying) health care.” HR 3962 strengthens the source of the problem. “Clearly, the insurance companies are the problem, not the solution. They are driving up the cost of health care.” They’re the reason why “31 cents of every health care dollar goes to administrative costs, not toward providing care. Even those with insurance are at risk. The single biggest cause of bankruptcies in the US is health policies that do not cover you when you get sick.”
Instead of fixing the problem, HR 3962 “accelerate(s) the privatization of health care. (It) inevitably will lead to even more costs, more subsidies, and higher profits for insurance companies – a bailout under a blue cross. (The bill) continues the redistribution of wealth to Wall Street at the expense of” Americans getting the kind of health care they deserve and badly need.
Former president of Physicians for a National Health Program, Dr. John Geyman, cited HR 3962 saying “No Bill is Better Than a Bad Bill” in enumerating its negatives, including:
- enriching providers “on the backs of patients and their families;”
- having “no effective cost containment mechanisms;”
- a public option available only to about six million people or 2% of the population, and in 2013 will cost more than private programs for sicker people because insurers are unrestricted on what they can charge;
- health care will be more, not less expensive; and
- will still leave millions uninsured and millions more underinsured.
“In sum, this (monster won’t) fix the major problems of cost and affordable access. (It) will add new layers of bureaucracy and complexity, is not fiscally responsible, and is not sustainable.”
Debate now shifts to the Senate where the best outcome will be killing Obamacare because “no bill is better than a bad” one.
The California Nurses Association (NSA) said the following:
“This Bill Fails to Control Costs.” While providing “limited assistance for some, the inconvenient truth is (it falls) far short in effective controls on skyrocketing insurance, pharmaceutical and hospital costs, (does) little to stop insurance companies from denying needed medical care recommended by doctors, and (provides) little relief for Americans with employer-sponsored insurance worried about health security for themselves and their families.” And the Senate legislation is even worse.
The National Organization for Women said the “Bill Obliterates Women’s Fundamental Right to Choose” that became law in the landmark 1973 Roe v. Wade decision, and is still the law of the land. The Court held that a woman may abort her pregnancy for any reason, up to when “the fetus becomes viable.”
HR 3962 violates that right. Except in cases of rape, incest, or if a woman faces death, the Stupak (D. MI) amendment prohibits using federal money for insurance covering abortion. It prevents women participating in insurance exchanges from using their own money to buy abortion coverage. It denies low-income women access to it entirely.
According to the Congressional Budget Office (CBO), it:
- will cost $1.055 trillion over the next decade, netting out at $894 billion after revenue enhancements;
- mandates coverage and penalizes those without it up to 2.5% of their income;
- insurance for individuals earning $44,000 pre-tax will be $5,300, plus another $2,000 in out-of-pocket expenses for an annual $7,300 total, or 17% of their annual income; families earning $102,000 pre-tax will pay $15,000 in premiums plus another $5,300 in out-of-pocket costs for a total annual $20,300 cost, or 20% of their annual income; those earning below these amounts will be eligible for subsidies, based on a sliding scale, paid directly to insurers;
- includes a watered-down public option by setting up insurance exchanges through which low income households are subsidized to make coverage more affordable; the plan is so weak, only an estimated 6 million or fewer will qualify; Physicians for a National Health Program (PNHP) lists myths and facts about it below;
- expands eligibility for Medicaid;
- lowers the federal deficit by $104 billion by 2019 and even more in the following ten years;
- “substantially reduce(s) the growth of Medicare’s payment rates for most services” by cutting over $400 billion in costs; the true figure is much higher; more on that below; and
- leaves 18 million uninsured by 2019, including about six million undocumented immigrants; the Senate Finance Committee’s bill leaves 25 million uninsured.Pre-existing condition exclusions will be prohibited, but insurers may charge what they wish, so effectively nothing changes. Endorsing the bill:
- the drug cartel;
- the American Medical Association;
- the US Conference of Catholic Bishops because of the anti-abortion provision; and
- the AARP, an insurance/financial broker masquerading as an advocacy group for anyone aged 50 or older.
The Centers for Medicare & Medicaid Services’ (CMS) Assessment of Medicare Cuts Under HR 3962
On November 13, CMS released estimates of the “costs, savings, and coverage impacts” of HR 3962, showing Medicare spending will be cut by a draconian $570.6 billion, well above the CBO figure. Enrollees unable to cover the difference will be devastated. Millions will get less care when they most need it. In some cases, hospitals and nursing homes may deny it altogether.
Medicare will introduce “permanent annual productivity adjustments to price updates for institutional providers” to maximize “efficiency” – costing $282 billion, over half the total cuts. They’ll affect acute care hospitals, nursing facilities, and home health agencies, and be based on economic productivity overall, but CMS notes that:
“Except in the case of physician services, we are not aware of any empirical evidence demonstrating the medical community’s ability to achieve productivity improvements equal to those of (the) overall economy.”
As a result, provider costs will rise faster than Medicare payment increases. They, in turn, will reduce care or opt out of the program altogether. Many providers have done it because of low compensation. CMS states:
“Providers for whom Medicare constitutes a substantive portion of their business could find it difficult to remain profitable and might end their participation in the program (possibly jeopardizing access to care for beneficiaries).”
Medicaid eligibility will also be impacted, threatening access for millions of poor people, dependent on it as their sole source of care. Although HR 3962 increases spending by $77.5 billion to cover the cost of new enrollees, CMS says higher demand may cause providers:
“to accept more patients who have private insurance (with relatively attractive payment rates) and fewer Medicaid” ones because it won’t be cost effective to do it.
Physicians for a National Health Program (PNHP) on Myths and Facts about a Public Option
Myth: More choice.
Provider and location choices will be limited. Seeking care outside networks will cost more, and authorization will still be required.
Myth: Patients may keep their doctors regardless of employment changes or health.
The employer-based system stays intact. If a new plan is chosen, only doctors in it may be accessed. Patients retaining their own will incur higher out-of-network fees. Insurers may also cherry pick the healthy and avoid the sick. Patients becoming ill risk losing employer-based coverage or face higher premiums to keep it.
Myth: Private insurers will have to compete on a level playing field.
HMO’s “undermine fair competition despite regulations.” They “cherry-pick” the healthy and avoid the high-risk. They also cost up to 19% more than traditional Medicare despite their lower age category enrollees.
Myth: Everyone will have quality, affordable care.
The current system is unsustainable. It will worsen if Obamacare passes. In whatever form, the “international experience with public option schemes” shows they don’t provide universal coverage – because insurers pick the best and screen out the rest.
Myth: Patients will get better care because of “innovation in the quality care physicians provide.”
Quality won’t improve. Today’s dysfunctional system won’t change. It’s driven by profits, high costs, and for insurers denying expensive care or delaying it as long as possible.
Myth: Cost will be reduced.
False because no provider bureaucracy savings will be achieved. “Adding a public option to the array of private insurance companies….will only exacerbate the waste and inefficiency inherent in a patchwork system….”
Health care is a fundamental human right no different than food, shelter, clothing, clean air and water, and other essentials to life and well-being, not something to be bought and sold as a commodity. Universal single-payer coverage is the solution, not America’s dysfunctional for-profit model.
If Obamacare is enacted, it will cost more, deliver less, leave millions uninsured, millions more underinsured and leave a broken system in place. It will enrich the insurance, drug and large hospital chain cartels at the expense of universal coverage. It will solidify a class-based system delivering the best care money can buy. Others will get sub-standard treatment, and for millions none at all. The solution is everybody in, nobody out under a universal, single-payer system. No one should accept less or politicians who won’t provide it.
Political “leadership” of the two oligarchy parties spin their economic policy as being for the public benefit. Professional economists increasingly cast economic policy in unprecedented harsh criticism, even calling for public demonstrations against what they claim as gross violations of financial law. Let’s consider current facts of high importance:
• Transfer of somewhere over $3 trillion with a total potential of $23.7 trillion to banks and financial institutions for the socialization of their gambling losses on illegal sub-prime mortgages and credit default swaps. We know the sub-prime lending was illegal because the FBI concluded 80% of all sub-prime criminal fraud originated from the lenders.
• A so-called bailout designed to give money to the banksters without accountability of where the money is going. This is according to testimony of Elizabeth Warren, Harvard law professor appointed to oversee the bailout for Congress, with video explanation below. The bankster-bailout was chosen rather than simply protecting depositors and reorganizing the banks under standard bankruptcy procedure. The two oligarchy political parties denied Congressional hearings for the bankster-bailout, which should have considered cost-benefit analysis for public banks rather than private banks. An important fact that would have come out of the hearings is that the total market capitalization of all the major US banks was less than $300 billion; meaning that the government could have outright bought all of them for less than a tenth of the amount given away. Think about that.
• A 2009 record payout to bank employees, including lucrative bonuses, on pace for $140 billion. Goldman Sachs, with three recent CEOs who have also been Secretary of the US Treasury, is doubling their bonuses from 2008.
• Depression-level unemployment, with the government’s “official figures” understating true unemployment by half.
• 100,000 laid-off teachers with class sizes expanding to over 40 students per class, and over a million homeless US students.
• The economic crushing of the American middle class, as explained by Elizabeth Warren in her video.
• Record high home foreclosures. An alternative policy to the bankster-bailout would have been to have the banks write-down the value of the mortgages they fraudulently wrote, and reset that lower value as the new loan amount for the homeowner. This could have been a preliminary move to creating non-profit mortgage rates for the public benefit.
• Record federal budget deficit of $1.4 trillion.
• Record federal debt of $12 trillion with annual interest payments of ~$450 billion every year. The oligarchy has no policy to ever pay the national debt, only to make the minimum interest payment. They don’t even try to defend that the national debt is in the public good and never discuss monetary reform to end the debt.
• Record total US debt from all sources of over $70 trillion.
Dylan Ratigan of MSNBC’s show, “Morning Meeting,” calls the economic “bailout” and subsequent policy, “the largest theft and cover-up ever,” “the worst deal since the Indians sold Manhattan,” “the ‘Masters of the Universe’ are on the take from the taxpayers,” “the biggest transfer of money in the history of the world,” and “No one, the Pharaohs, you pick ‘em, no one even comes close to how much the banks and politicians have stolen from us.” His video is also below.
Paul Craig Roberts, Assistant Secretary of the Treasury during President Reagan’s first term, Associate Editor of the Wall Street Journal, and Senior Research Fellow at the Hoover Institution of Stanford University simply writes, “The rich have stolen the economy.”
If it’s any comfort, remember that America was born from recognition that our government was playing us, exploiting our labor for their financial gain and not for the public good. Remember that our government labeled Thomas Jefferson, John Adams, Benjamin Franklin, George Washington, James Madison, and all the Founding Fathers as “traitors” when they didn’t blindly and stupidly believe the empty spin that the government was acting in the public good. They also predicted that future generations would have to fight to retain the liberty they wrested from lying political whores who murdered the public good in exchange for personal wealth, fame and power.
If you ever wondered how educated Germans could ever believe Nazi propaganda, all you have to do is look around the US today.
The good news is that the structural economic change for the public good is simple. Monetary reform ends the banks from creating money, shifts this power to the Treasury for the direct payment of public goods and services and minimizing the peoples’ cost of credit (think 1% interest-rate mortgages). Real regulation will end casino capitalism with exotic derivatives betting on future economic outcomes that produce no public benefit in the gambling. Taking money out of elections and politics will limit political corruption. Breaking up the five corporations that currently serve as the propaganda arm of the oligarchy will help; the so-called mainstream media, or sheepstream media corpse as I like to call it.
To get from here to the good news is a formidable task. I suggest a Truth and Reconciliation process to exchange our getting the complete truth and ending all criminal and damaging political and economic acts for the perpetrators’ cooperation and return of public assets. I’d even allow them a stipend to facilitate their surrender of our government and economy; what the oligarchy presently consider their own twisted private playground.
The two interviews are necessary education for the public to see the economy for what it is. They are 6-minutes and 7-minutes.
John Conyers and some allies on the House Judiciary Committee have come up with a fabulous way to get the insurance industry in line — by threatening to remove their anti-trust exemption.
Many people don’t know that the insurance industry, under the McCarran-Ferguson Act of 1945, has a broad anti-trust exemption that facilitates regional monopolies. The Act allows states to regulate the insurance business instead of the federal government, but also allows that, as long as the state regulates the industry, federal anti-trust laws would not apply.
As a result of this exemption, states have seen markets for health insurance where one or two companies predominate. In the state of Maine, Wellpoint controls 71% of the market. In North Dakota, Blue Cross controls 90%. Using the Herfindahl/Hirschman Index, a metric for market concentration, a 2007 study by the AMA found almost every health insurance market in the United States is highly concentrated.
This edition of the study analyzed 313 MSAs. This compares with 292 metropolitan areas in the 2005 study, 84 in the 2003 study, 70 in the 2002 study, and 40 in the 2001 study.
In terms of market concentration (HHI), the study found the following:
In the combined HMO/PPO product market, 96 percent (299) of the MSAs are highly concentrated (HHI>1,800), applying the 1997 Merger Guidelines.
In the HMO product market, 99 percent (309) of the MSAs are highly concentrated (HHI>1,800), applying the 1997 Merger Guidelines.
In the PPO product market, 100 percent (313) of the MSAs are highly concentrated (HHI>1,800), applying the 1997 Merger Guidelines.
Here’s the AMA study. Paul Rosenberg has a lot more on this.
The point is that the concentration of the health insurance market among regional monopolies leads to higher costs for consumers, almost by definition. What the legislation by Conyers (D-MI), Hank Johnson (D-GA) and Diana DeGette (D-CO) would do is end that anti-trust exemption for health insurers, allowing for enforcement in all of these highly concentrated markets. The Senate has companion legislation:
“This legislation would specifically prohibit price fixing, bid rigging, and market allocation in the health insurance industry,” said Conyers. “These pernicious practices are detrimental to competition and result in higher prices for consumers. Conduct that is unlawful throughout the country should not be allowed for insurance companies under antitrust exemption. The House Judiciary Committee held extensive hearings on the effects of the insurance industry’s antitrust exemption throughout the 1980s and early 1990s. It became clear then that policyholders and the economy in general would benefit from eliminating this exemption. “The legislation we introduced today is intended to root out unlawful activity in an industry grown complacent by decades of protection from antitrust oversight. In doing so, we aim to make health insurance more affordable to more Americans. I want to thank my friend Senator Leahy for his leadership on the bill and for working with the House on this joint introduction.”
Many of the actions taken by the insurance industry over the years simply violate federal law. Repealing their anti-trust exemption would force the industry to end their criminal ways or face punishment. As a companion to insurance regulations designed to lower prices for consumers, but perhaps without the kind of enforcement necessary to maintain it, I couldn’t think of anything better. And if nothing else, this legislation is a powerful whip to keep the industry in line as they try to extract more perks from the health care bill. Combine this with the multiple investigations into industry practices from Dennis Kucinich, Henry Waxman and others, and you have real pressure on the industry for the first time in a while.