Archive for the ‘affordable care act’ category

Reading Election Tea Leaves

November 8, 2017

Today is the morning after. Yesterday an off year election was held which featured two high profile governorships at stake. Democrats won both (Virginia and New Jersey) and surprisingly across the country, Democrats picked up previously Republican held offices. What was behind this Democrat resurgence?

Money was not a factor even though there was plenty of money spent. Performance in office did not seem to be a factor either, both governor’s races were open since the incumbents were term limited and could not run. So what provided the spark for Democrats?

Some pundits are saying yesterday’s races represented a repudiation of President Trump and his policies. Interestingly, Republican spokespersons disagreed and claimed instead that voters were dissatisfied with the lack of legislative action on the President’s campaign promises.

In other words, had Congress passed the Affordable Care Act “repeal and replace”, and pushed through a huge Middle Class tax reform, then voters would have rewarded the Party with victories. Hmmm.

Reality, however, is more likely different. According to news reports, women played a big role in Republican candidates’ defeat. Women came out to vote and did so in what might be record numbers. Overall voter turn out was unusually high for an off year election across the country.

Rather than conclude Republicans lost key elections because the White House and the Republican controlled Congress did not accomplish what they promised in 2016, it might be wiser to think Republicans lost because of the mean spirited, wrong headed ways the President and Republican controlled Congress conducted themselves.

Trying to cheapen healthcare many women depend upon, backing away from the Paris Climate agreement potential leaving a more severely damaged world for our children, and attempting to pass a tax cut which blatantly passes out billions to the very wealthy and puts the tab on our children and their children charge account (the Federal Debt) has not been missed by a growing number of voters.

Voters, especially women voters, see what’s going on, and are beginning to recognize that  the outlook is not promising in the Trump/GOP teapot.

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The Other Side Of The Coin

November 3, 2017

House Republicans have just released their proposed tax code rewrite. Experts are rushing to digest the proposal and perform the difficult task of assessing how this Republican bill will impact Americans. Wait, wait… if you are wealthy, you do not need to worry. This Republican plan will treat you well and provide opportunities for clever tax advisors to find new ways to save you tax payments.

The bill provides most (but not all) the gifts the rich have been expecting. The top bracket of 39.5% remains although the income threshold has been raised to $1,000,000 allegedly in deference to the “gift to the wealthy” optics.  Carried interest, estate tax elimination, and reduction of corporate taxes (35% to 20%) for private owner businesses will provide the wealthy with plenty of tax relief opportunities while the tax burden is shifted to lower income Americans.  And, for those unfortunate Americans earning $500,000 to $999,999, you will just have to pay in a lower bracket.

The deal is not set yet. Republicans from high tax States will argue for sweeteners in the restoration of State and local tax deductions and full credit for mortgage interest. Lobbyists representing all sorts of industries will go into full court press to preserve other deductions and credits. It is entirely possible that this attempt at tax code changes will stall or fail outright.

But it is entirely possible that this proposal or something substantially the same will pass. What then?

For sure it is maddening that very wealthy people like the Koch Brothers and Robert Mercer will pay less taxes.  It is maddening that as a consequence, the tax burden will shift to less wealthy people (like the Middle Class), or the cost of this tax cut will flow to the national debt, or both.

But that is not the real damage that this tax code change will bring.

A coin has two sides. On one side, heads, is the smiling faces of Americans paying less in taxes. The other side, tails, however, means there will be less government revenue to cover already approved government spending. Let there be no mistake, with lower tax revenues there must be less government spending sooner or later.

Republicans will be quick to assert that there are all sorts of waste and corruption in government spending. Why, Republicans will point out that there are able bodied Americans drawing social security disability benefits who could be working. And look at Medicaid excesses associated with the Affordable Care Act. And, with their faces now reddened, Republicans will bluster about spending in all sorts of other areas. Surely, cutting wasted money can be made.

Maybe. The problem usually boils down to which programs are viewed as wasted spending and what justification makes those expenditures “wasted”.

For example, Republicans have attacked the Affordable Care Act (train wreck, a jobs disaster) even though there were some 20 million more Americans insured with Obamacare than before. And, what have Republicans offered? Their best proposals offer less coverage and insure 10-15 million fewer Americans.

So, when it comes time to submit “post tax cut” Federal Budgets, what makes anyone think Republicans won’t feel that reducing programs which benefit all but the rich will be perfect targets?

The theme which comes up time and again is that there are no free lunches. Republicans are breathlessly trying to sell this tax code change as great for the middle class and the key to unlocking our economy, and best of all, there will be no cost to average Americans.

Really?

Governing Part II

November 2, 2017

The Republican Party now holds the reigns of government with control of the Presidency and both houses of Congress. Despite this apparent political control, Republicans have been relatively impotent. Governing Part I offers the thought that the Republican Party is a collection of disparate factions whose inherent policy goals are in conflict externally with a majority of voters’ interests, or conflict internally with other Republican factions’ policy demands, or both.

Implementing the Republican majorities has become surprisingly difficult and fraught with potential unwelcome blow back at the next elections.

Does this imply that Democrats would govern better?

Maybe… but at the very least, the Republican dysfunction speaks to the outsized influence mean spirited conservative big money (“dark money” per Jane Mayer) plays.

Democrat governance would speak to different financial interests. IMO, progressive views, characterized as “center, slightly left”, would be far more pragmatic and directionally sensitive than the current regressive Republican policies.

Contrary to Republicans’s notion that America’s future is destined to look like its past, “Make America Great Again” is on the wrong side of history.

  • Globalization is a fact from which retreat is not possible… and still have America grow in economic terms. Low cost manufacture will chase low cost, high quality labor. High cost manufacturing will reduce Americans’ standard of living. Free and fair trade are a must.
  • Growing income inequality is not a sign of globalization, but rather a greedy, thoughtless, and selfish product of wealthy Americans. Labor regulations and a creative tax code are needed to share the fruits of capitalism more productively.
  • Global warming is real and will drive dislocations in energy supplies. Attempts to favor oil and coal over natural gas or renewable energies denies the science behind global warming, increases the atmospheric carbon, and brings on the destruction associated with rising seas.
  • Digitalization (computers, internet, wifi, artifice intelligence and automation) has changed labor’s definition of “good jobs”, basic skill requirements, and the training and education needed.
  • Population growth rates in developed countries has slowed to below replacement rates and has placed a new value on immigration. Comprehensive US immigration reforms is a far wiser approach than building a wall.
  • Most of the developed world see basic healthcare as a citizen’s right and a necessary government/private sector service. Often over looked is that basic healthcare as a right helps center a person’s thinking around the value of government.
  • Retirement protection is an emerging need. With most companies no longer offering defined benefit retirement plans, and 401k savings plans subject to changes in the tax code, a national retirement pension fund would seem wise. The general notion is that retirement with dignity should be a right for everyone but how to fund such a program must be identified.

So, how does the Democrat Party stack up against these realities of our changing world?

  • Dark Money – Democrats have accepted campaign donations from a wide range of sources, dark money conservative sources excepted.  Reasonable limits and full transparency has been a Democrat position.
  • Globalization – Democrats have reluctantly embraced free trade including NAFTA and the TTP despite the objections from organized labor.
  • Global Warming – Democrats have openly embraced the science behind global warming theory and have endorsed policies which restrict carbon dioxide emissions. Democrats have given only lip service to dislocated labor (like coal miners).
  • Digitalization – Democrats have proposed a wide range of training and education programs but as in many other programs, have not told Americans what it will cost to implement their ideas nor what it will cost the Country if these ideas are not implemented.
  • Immigration and a diverse work force are solid Democrat principles, again if these positions can be sold to the Unions.
  • Basic healthcare – Democrats supported the Affordable Care Act but only a few Democrats strongly spoke out for single payer, universal healthcare for all (like that found in Europe).
  • Retirement Support – Democrats support the government’s role in assuring workers the dignity of a social security-like payment which makes retirement “livable”.

Are you ready to sign up for the Democrat Party?

Remember how Democrats acted after the majority Democrat Party passed the Affordable Care Act.   When election time rolled around, however, many Democrat candidates were silent and tried to change the subject when their Republican opponents criticized Obamacare. Democrats did not campaign on the idea of repealing Obamacare, as did Republican candidates, nor did Democrats vigorously defend Obamacare.

Lukewarm, would you call it?

Great leaders come along every so often. FDR, JFK, LBJ, and to a lesser extent, Bill Clinton were effective in passing important legislation. Barack Obama, when Democrats controlled Congress did get through healthcare reform but not much else (except by Executive Order). Obama will be more remembered for what he urged Congress to do as well thwarting what a mean spirited Republican Congress tried to do.

In this age of sound bites and tweets, will Democrats portray themselves in proactive terms? If Republicans are the Party of small government, low taxes, and individual initiative, what are Democrats?

Party of Opportunity, Security, and Leadership (for all Americans) in the 21st Century might be a place to start.

Hmmm.

Governing Part I

October 29, 2017

There has been much written about the inability of the 115th Congress, one with Republican majorities in both Houses, to pass meaningful legislation. In the 113th Congress, Elements within the Republican Party orchestrated a Government shut down squabbling over an ideological but relatively pointless issue. The question is why are current day Republicans so inept when at the Ship of State’s helm?

Could it be there internal inconstancy among policies Republicans claim they hold dear such as:

  • Federal Debt – “Massive, out of control, and an unfair burden for our grandchildren”. In fact, US Federal Debt is about average for all the countries in the world. US Debt is higher than Switzerland, about the same as Germany, and lower than Japan. The real underlying problem with US Federal Debt is that it results from the Congress’ inability to make rational decisions on spending and taxation.
  • Tax Reform – When Republicans mention “Tax Reform”, the are really voicing a free lunch message around “tax cuts”. Republicans claim tax reform will lower (big time) Middle Class tax burden when in fact the tax cuts are premised on lowering the tax for the wealthiest of Americans. Oh, and what about the Federal Debt? This is a shameful policy and consequently Republicans must use all sorts of misdirection and misinformation to keep the voting public from seeing through their scheme before tax cuts are enacted.
  • Healthcare – In the past, Republicans were mainly agnostic about healthcare. Since the enactment of the Affordable Care Act (Obamacare), Republicans have been like a dog chasing after a meat wagon. Not surprisingly the Republican mantra overlooks the fact that some 20 million more Americans have healthcare access with Obamacare than before, or that the US pays twice as much for healthcare than other modern countries. It would appear that the national Republican Party goal is to reduce Medicaid involvement and to eliminate taxes which the wealthy pay, and in return Republicans are willing to see millions less Americans receiving coverage. Hmmm.
  • Medicaid – Even if there was not a broader fight over healthcare, Republicans support only a much smaller application of Medicaid. Many Republicans see Medicaid as “an entitlement” (something Americans do not earn) and a naturally growing government handout.
  • Social Programs – Republicans use this broad terminology to imply that Government aid for specific social programs is a wasteful and wrong headed idea. Surprisingly, the tone was different this past week when President Trump declared an emergency around the growing (predominantly white population deaths due to overdosing with opioids. Hmmm.
  • Environment – when it comes to government policy towards issues such as smoking, industrial discharge into rivers, land, and the air, and most recently global warming, most Republicans have been unusually skeptical on the “science” demanding controls. Could campaign contributions drive Republicans to favor businesses and overlook the welfare of its citizens?
  • Immigration – One of the most convoluted arguments Republicans have made is the danger posed by Mexican undocumented workers. The approximate 11 million illegal workers has been labeled as the cause of most violence, a huge drain on social programs, and “line breakers” who are trying to gain citizenship by not following the rules. Mexicans are mostly church goers, family centered, and extremely hard workers who make model Americans if given the chance. Could it be that Mexicans, if given the vote, might vote Democrat?
  • Faith Based Issues – Probably the most shameful and hypocritical position Republicans candidates have taken lie around the issue of god and religion. Republicans stand firmly by the Constitution when they pander to gun owners but are willing to twist the Constitution and accept discrimination based upon ethnicity, gender, or sexual orientation (if the discriminator is motivated by deeply held religious beliefs). This is akin to one Bill of Rights phrase, overriding all other rights if it is favored by a large number of bible totting voters.

The reality of this boils down to who elects Congress members and which issues are the most important. Distorting the otherwise democratic process is the unparalleled amounts of campaign donations coupled with the “legal” and huge amounts of “issues” money.   Mostly all of this money has emanated from the wealthy, and has driven the political conversation to elect a majority of RINOs (Republican in name only). This group, depending upon where in the country they represent, bring a range of intensity to the issue mentioned above.

If instead of keeping the single name “Republican”, each member chose a more applicable name like Christian Republican, No-tax Republican, Big Business Republican, etc, then the current Republican Party would not hold the majority and power would shift to others. So, banding together, even with vastly different depth of feelings around specific issues, makes the Republican brand the majority.

Republicans, however, are showing that being the majority and providing effective governance are two different matters. This year’s Republicans are hopelessly compromised owing so much to so many (tax cuts to the wealthy contributors, discrimination rights to bible thumpers, anti-immigration action to the xenophobes, anti-science policies to short sighted business leaders, and second class and hugely expensive healthcare policies to ignorant (uninformed) Americans.

Republican Congress members are complex and thinking people. Most, if not all, know the real nature of this Post’s issues. Unfortunately too many are willing to “go along”, thereby making unbalanced choices which are setting in motion collisions between common sense and prejudices or flatly unsupportable policies. In such an environment, facts are not important, and democracy suffers while governance becomes problematic.

 

Taxes Make The World Go Round

October 18, 2017

Congress and in particular, the Republican majority are in a whirl. With majorities in both houses and a Republican President, the GOP has nothing to show for its hold on the reigns of power. I should be quick to say, nothing yet.

The two signature pieces of legislation Republican leaders boast about have been the “repeal and replace” for Obamacare and the “tax reform” for individual and corporate taxes. For a host of reasons the GOP has not been able to agree upon legislation which would accomplish these goals and have looked impotent in their efforts.

The most obvious reason for the GOP inability has been the absence of a sound logical rationale for either healthcare or tax reform even in the face of overwhelming evidence that the Affordable Care Act (Obamacare) and the current tax code are badly in need of modifications. One wonders why?

Would you believe that Republicans do not really care about either healthcare or about tax reform? True. Despite all the rhetoric and chest thumping, at the end of the day Republicans do not care about healthcare as a right of all Americans nor do they care about a tax code which generates sufficient revenue to cover government expenses. Hmmm.

One wonders how Republicans can justify a reduction in both benefits and the number of Americans covered with healthcare insurance while at the same time, and with a straight face, push for ending the individual mandate and the taxes higher income Americans pay under Obamacare. Republicans promise more healthcare options and lower costs for coverage without telling many Americans that they better hope they never get really sick (need coverage) or have pre-existing conditions.

But make no mistake Republicans do care about reducing taxes, especially on those Americans who are the major funders of their political campaigns. Hmmm.

The current individual tax code offers another insight.

Marginal Tax rate

On Earnings Per Year

10%

$0 – 9325

15%

$9325 – 37950

25%

$37950 – 91900

28%

$91900 – 191650

33%

$191650 – 416700

35%

$416700 – 418400

39.6%

$418400+

While the specifics of the Republican tax reform bill are not fixed, think about the impact of the rumored new rates and brackets. Gone will be the 10% bracket so one would assume that 15% would apply to all income from $0 to $37950. Sounds like a tax increase to me. (In truth, increased standard deductions could make the increase much smaller or even disappear.)

But let’s look at the other end where the top bracket of 39.6% is said to disappear. Someone earning, say $500,000 per year would see an immediate tax reduction $23,000 (4.6% x $500,000). For the average Fortune 500 corporate CEO earning $15,000,000 the savings looks more like $690,000. And you do the math for the billionaire earners.

For 2018 mid-term elections, it should not take a genius to inform American voters what the GOP has done (or tried to do) for the last two years and what lies in store for them in the future.. Most Americans have employer provided (group plan) health insurance or are on Medicare. They are not affected… now.

If the GOP is content to do dirty with some Americans, what makes anyone think that other Americans will soon be at risk?

The prognosis on taxes is just as dangerous. It is possible that the reformed tax code will only slightly hurt the average American (new deductions could offset those eliminated (like State and local taxes or mortgage interest). The baked in tax break for the very wealthy will reduce overall tax revenues which in turn will limit government spending on a variety of programs, and possibly leading to cuts in Medicare, Medicaid, and Social Security.

And, if Republicans do not try to cut enough spending to offset the tax revenue loss, the difference will go on the “credit card”, our Federal Debt.

Hmmm.

Beautiful Healthcare

October 8, 2017

The Tweet-meister has once again promised Americans “beautiful” healthcare, without the “high premiums” some individual insurance seekers are experiencing. What magic does President Trump have in mind? Do you think he will embrace Medicare for all? Do you think he will recommend the US adopt a single payer system like Australia, Canada, or most of Europe?

Unlikely.

To date, the GOP has been serious about controlling cost exposure for those in the single payer market. Shamefully, the Republicans have chosen various forms of “less coverage”, “fewer insured”, and outright mistruths to portray their proposal as providing “beautiful” healthcare coverage. Why?

Opposition towards the Affordable Care Act (Obamacare) has been mainly a partisan political event. Republicans have never been serious about maintaining (or increasing) the basic healthcare insured rolls. Republicans have eyed the single payer (largely individual owner proprietorships) who could be counted upon to vote Republican.  The rest of Americans were far less important.

The GOP has lamented rising rates and declining insurance company participation in certain markets. Behind these crocodile tears, however, has been (you select which one), either (1) a basic ignorance of how any insurance market works, or (2) a cruel belief that those added by Obamacare were mostly lazy Americans unwilling to do what it takes to work hard.

Why would insurance companies keep raising rates in many markets? Does anyone connect that people who were sick and now have insurance might just be using it?

Does anyone think that many who otherwise reneged on paying doctors and hospitals previously (and by the way, those costs were written off by everyone else paying through insurance), and were now enrolled in Obamacare, were not going to use healthcare?

There have been some commonsense proposals, short of single payer, such as putting all single individuals seeking insurance into a group composed of all other single individual Americans (forming groups like employers do). The idea is that insurance companies could then set rates based upon this much large pool.

This approach might stabilize insurance markets but over all there is no way this proposal will lower healthcare spending. People who are sick or have experienced healthcare coverage for the first time with Obamacare will still get sick and will still want to use healthcare services.

The tweet-meistre might do well if he asked questions about how to lower healthcare costs without reducing coverage or those covered.

Such a line of questioning will invariably lead to where costs are generated, namely doctors, hospitals, and drug companies. This healthcare industry is like no other in the modern world and represents 1/6th of the US economy. If in some magical way, President Trump decreed that the US should adopt a healthcare model like Germany or France, where healthcare spending is about 1/2 that of the US (with equal or superior healthcare outcomes), it would require years to transition to that model without bankrupting many doctors, hospitals, and drug companies, not to mention healthcare insurance companies.

All I can say is that after such a transition, healthcare would be “beautiful” for the average American.

Strategic Thinking?

October 6, 2017

President Trump has signaled that he plans to “decertify” (not recertify in terms of the agreement with Congress) the Iran Nuclear deal. This Presidential act is expected to add this mind boggling foreign policy move to walking away from the Paris Climate Agreement and the abrupt withdrawal from the Trans Pacific Trade Pact. The President seems to be steadily making progress isolating America from the rest of the world.

It might not be difficult to understand why the Iran Nuclear Deal might not seem such a great success. Iran promised to side line its nuclear development activities in return for an end to crippling economic sanctions. Iran, however, did not agree for ever and explicitly did not agree to change its ways beyond the narrow scope of the agreement.

For the John Boltons of this world, this was a weak, maybe useless, agreement.  Israel thought much the same.  Drive for a “better deal” was the conservative mantra.  Hmmm.

The preposterous justification for stretching out Iran negotiations was that their economy was failing and soon there might be a regime change.  What makes anyone think a new Iranian regime would be better than the one that currently exists? Recent history would strongly suggest that Iran would tend towards even greater extremes and regional destabilization. And which Middle East country might lead a better power than Iran? Syria, Iraq, Saudi Arabia Egypt, or Turkey?

Should the US impose economic sanctions and effectively refute the agreement, most foreign policy experts foresee a global realignment with China and Russia supporting Iran.

If the Trump Administration is expecting Europe to stand solidly behind US policy, this may be a short sighted view. From all technical reports, Iran has abided by the terms of the 6 nation agreement. How could Germany, France, or England convince its citizens that reimposing sanctions was now the right thing to do?

Of course being tough on Iran does play well with many Trump supporters and is music to the Bush era chicken hawks. But this does not answer the question, what is or would be President Trump’s strategy?

One could conclude the President could initiate some new round of negotiations where his self proclaimed deal making skills would come out on top. This is not a strategy.  One could also conclude that there might be some other motivation for what appears to be illogical behavior.

For example, President Trump could be so insecure that he will not rest until he has dismantled every policy established during the Obama years. The President may be so blinded that he can not grasp the advice aides are providing unless the advice reinforces his instincts.

One could also conclude that the President seeks an isolationist USA, separated from other world alliance by self inflicted decisions.  President Trump could see such a situation as producing a ripe set of financial opportunities for the Trump brand.

With no permanent alliances where there were implied mutual behaviors placed upon the US and the other country, the Trump enterprises (and its supporters) could forge all sorts of “one off” deals around the world without fear of breaking some treaty or international understanding. Hmmm.

President Trump is our President thanks to an open election. Although the outcome was close, as Americans we are expected to abide by the results. The implication here is that the President is free to disengage from, refute, or even form, new bilateral arrangements which may not be good for most Americans. Elections have consequences.

There is a picture emerging around the Trump Presidency. President Trump is combining the worst elements of the Republican Party (petty and selfish interests) with his own turmoil loving tendencies to turn the US into a country others do not understand and certainly do not trust. Previous Administrations gave far more attention to both domestic and foreign events, especially as they related to the overall strength of the US economy.

Today, the stock market is at all time highs. The President may think that this is the vote of confidence and high Dow Jones averages protects him from any unanticipated blow back from his policies. Think again Mr President. If big money, pension funds, and hedge fund managers. lose confidence when the market crashes, the Trump Presidency will be a lame duck if it even last to 2020.

Whether it be unpaid tax reform, cheapened healthcare, or discrimination under the name “religious beliefs”, history will quickly show how devastatingly poor the Trump Administrations choices have been.

And then someone will again ask, what was the President’s strategies? What was he thinking?  Did it consider the average American, or just himself?