Posted tagged ‘medicaid’

The Eastern Front?

May 22, 2017

Most historians cite Hitler’s decision to attacked Russia and opening a second front on the East as the crucial event which ultimately lead to Germany’s defeat in World War II. The argument goes that Germany spread its resources too thin and consequently could not win either in the west or the east. I wonder if history will repeat.

President Trump has a serious political and legal fight on his hands with regards to Russian Government involvement in the 2016 election. According to American security agencies, Russian entities did engage in hacking and dissemination of fake news during the campaign. After denying there was any Russian involvement, President Trump now asserts there was no “collusion” between his campaign and the Russians. The FBI and both the House and Senate have now investigations underway with the potential for serious political and criminal determinations. To make a matters worse and in true Roy Cohn style, the President fired FBI Director James Comey and told the Russian Foreign Minister that he had fired the “real nut job” (James Comes) and that would take pressure off this investigation. Hmmm.

Surprisingly this Russian investigation is not either the western or eastern front. Hmmm.

Instead, President Trump’s “western front” lays in his (and the Republican controlled House’s) tax cut proposals. The President is proposing “huge” cuts which will gift million and maybe billions to the wealthiest Americans. And, this Trump tax cut budget hole will need to be offset by budget cuts.

Therefore, the “eastern” (second) front will be Trump’s budget proposal itself.

Reports today say the President will propose sharp cuts to Medicaid in his budget proposal. Medicaid covers healthcare for the poorest of Americans and in many States covers millions of Obamacare newly covered Americans. While most Americans do not receive Medicaid benefits, these proposed Medicaid cuts signal the beginning of a wider attack, an all out attack upon healthcare coverage (America Health Care Act), followed by Medicare, and ultimately Social Security.

While tax cuts for the wealthy are shameful and unnecessary, offsetting these corporate and individual windfall tax gifts with cuts to programs used by the other 99% of Americans is mean spirited to the max.

Going for tax cuts is a mighty lift. Going for a huge reduction in government spending, particularly safety net and entitlement spending is an even bigger challenge. Going for both is likely to resemble a war with two fronts.

The Russian meddling investigation is a complication even Hitler did not have. While it is unlikely the President ever engaged directly with the Russians, it is not unlikely that several of his key staff and advisors did. The irony might turn out to be that any contacts with the Russians was really about potential future business deals (making money). not intent to sway the election.

The even larger irony might turn out to be that the President gets ensnared by coverup or obstruction activities (wanting the FBI investigation to simply go away) and not collusion with the Russians.  One would think the President would want, if only as an insurance policy, to boast high popularity ratings if the investigations were to turn political.  Offsetting tax cuts for the wealthy with entitlement cuts for everyone else may not appear popular as Americans think about things.  Hmmm.

It will certainly be hard fighting a war on two fronts.

Will The Hypocrites Please Stand Up

May 23, 2014

If there had been any doubt about rampant hypocrisy in Congress, it was erased yesterday. The House voted in a special authorization for military spending over $600 billion. The amount exceeded that requested by the Defense Department and flew in the face of previous calls for reductions in Government spending by these same representatives.

This spending, unlike any laws aimed at the social safety net, can be directly connected to votes and campaign donations in various States. The Defense Industry is good money spent, these legislators apparently think.

There are legitimate concerns, of course, about what military posture the US should maintain as we enter the 21st century. The lawlessness found in much of Africa, the nationalistic ambitions of China and Russia, and the inherent instability of the Middle East all pose potential threats to the US by disturbing established flows in international commerce.

What should the world’s policeman do?

For those who decry the role of world’s policeman, please reread the recent happenings in the Ukraine and Crimea. Or, try reviewing the Chinese bullying of Vietnam. And tell me about Iran, Iraq, Syria, Palestine, Israel, Egypt, and Libya.

So those who advocate for a strong military, in addition to rewarding a wide variety of supporters (read votes), could also have serious concerns about the future.

This vote by itself may not be the best bellwether predicting hypocrisy. One must look further, say to these House members’ campaign speeches and advertisements to get the clear smell of the hypocrisy.

How can the US cut healthcare (repeal Obamacare), adopt block grants for Medicaid, replace Medicare with vouchers, and put forward across the board cuts in most other safety net programs, insist upon remaining the world’s policeman?

For those who hold this position (raise defense spending, cut social ones), one can safely view them as hypocritical.

I’m afraid, however, the ugly truth is that, like it or not, the US must remain the world’s policeman.The US, however, must get smarter at it and undertake these duties far more efficiently.

Defense Department spending is by design inefficient and costly. Major defense projects are intentional segmented as that as many States can participate. The roles of the State Department and the military are poorly coordinated resulting in a balance that favors guns far more than diplomats.

And wasteful and fully useless engagements like the invasion and occupation of Iraq or the 12 year presence in Afghanistan must be avoided in any future policemen role. Maintaining the present US military footprint, in a more cost effective manner, would be prudent in view of the instability one can see in the rest of the world.

US military might could allow economic and cultural interactions to actually keep the peace.

The other side of the US domestic conundrum is a budget deficit.  This deficit has fueled this drive to reduce the social safety net spending.   But what if we attacked health care costs?

US healthcare spending approaches $3 trillion. On a per capita basis, this is about twice as much as two dozen other modern countries, and these countries produce equal or better health care outcomes. If the US could adopt a national healthcare system like Germany’s, this cost difference alone could eliminate our $700 billion budget deficit and put another $3-500 billion in US citizen’s pockets.

With such compelling economics, why isn’t Congress racing to implement these changes? The answer, while complicated, at the end of the day would require current participants in the doctors, hospitals, insurance companies, and drug suppliers to reduce their revenues by $1-!.5 trillion.

That would represent a lot of campaign donations, need I say more.

Just one word… hypocrisy.

Raise Foot, Aim, Shoot

May 22, 2014

Appealing to ones political base, is just that. This type of rhetoric, tell them what they want to hear, is seductive because the base will normally give back money and votes. But what if the political base in question is on a dead end path?

America finds itself today with two parties appealing to unsustainable “base” demands.

For example, Medicare, Medicaid, and even Social Security are on paths which financially the Country cannot afford… at least as the laws authorizing these programs are currently constructed. Speaking to one base that “we must shrink the size of government (a euphemism for just cutting benefits like Medicare, Medicaid, and Social Security)” will simply put the cost of these programs someplace else without impacting the need. Or speaking to the other base, “we can’t cut Medicare, Medicaid, or Social Security benefits or else we will break our nation’s promise ( an euphemism for there can be no cuts in these programs because I am counting on that group’s votes).  Both speeches are going no wheres.

The mid term elections will provide us with a new round of “base speech appeals”. We will hear speeches for a woman’s right to choose and others against. It is unlikely we will hear any speeches about how we can make abortions rare.

We will hear rousing demands for “sealing the borders” and others calling for immigration reform with a path to citizenship. We will not hear about creative ways to deal with the special situation involving Mexico. If these great workers and family oriented people were able to come and go freely (thus eliminating many undocumented residents), the largest piece of immigration reform could be removed. Instead the US will spend insane amounts of money with no prospects of achieving results.

In some areas, we will hear both sides talk about faith and how it important it is to them personally. It is unlikely we will hear anyone questioning the practice of some parochial schools to require their teachers to promise not to speak or practice such things as living with someone of the same sex or cohabiting with the opposite sex unless married.

Nor will we likely hear anyone speak out that it is incompatible with modern life for a University (Bryan) to demand of its teachers that they must accept and teach that Adam and Eve were magically created by god, and that we are biologically descendant from them (complete rejection of evolution).

There is no need to denounce the old political bases. Rather there is an urgent need to focus upon real problems facing the country, the State, or the locality. Job growth, pot holes, and hungry children are completely independent of religious views.

Healthcare (Medicare and Medicaid, plus any costs associated with the Affordable Care Act) presents a fundamental question for Americans, should every American have access to basic healthcare?

If the answer is no, end of discussion.

If the answer is yes, then the rich discussion of what constitutes “basic” care, what should it cost, and how should it be paid for would make for great election background material.

The GOP’s mouth is watering with the prospect of gaining total control of Congress. In 2012, a similar chance went down in smoke because too many GOP candidates spoke to their “base” and not the total electorate.

Will be see a repeat where the GOP lifts its foot, takes aim, and shoots?

Strange Behavior

April 3, 2014

It is unclear whether politicians with their eye on the 2016 GOP Presidential nomination intentionally vier to the right or that they are predisposed towards this strange behavior. Representative Paul Ryan and Governor Bobby Jindal offered this week two examples of “what are you thinking” politics.

Ryan released his committee’s budget recommendation with the headlines, “proposed budget to reduce spending by $5 trillion (over next 10 years)”. One might be struck by this as a sign of fiscal responsibility. But if one is not careful, one is sure to get struck by the “dumb stick”.

What are the details that Ryan proposes to achieve these savings?

The Ryan (Republican) plan is to chop discretionary spending across the board and cap government spending on Medicare and Medicaid. Medicare would be gradually phase into a fixed government grant to individuals who in turn would buy private insurance.

Medicaid would be changed to a block grant program and States could use that grant as they felt appropriate. These measure represent a big pill to swallow if you are anybody but the very wealthy. To put a little salt in the wound, Ryan proposes to increase military spending. Hmmm. But that’s still not all. Ryan proposes to reduce taxes to two tiers, 10% and 25% It is almost laughable that any national politician would propose this massive a present to the wealthy while taking so much from the most needy.

Gindal made news focusing only upon the Affordable Care Act. He assembled already proposed talking points which also converted Medicare to private insurance program and Medicaid to block grants. Everyone else would go back to sort of what like things were before ACA. Back to the future.

On one hand, I give credit to these GOP members for taking a shot at fiscal reforms. Democrats, who own the moral high ground, have not offered proposals on how to make the current government spending fiscally sound. In an entirely different way, Democrats are letting down the very people they publicly say they are defending.

Putting the government on a fiscally sound basis must involve capping and reducing the cost of healthcare. Affordable Care Act is a step in that direction. ACA, of course, may not work as envisioned, or ACA may still not keep rising health costs in check. With so many other countries enjoying better health outcomes at 1/2 the cost, it will become more and more difficult to keep proposing GOP solutions which also will do nothing to control costs.

With respect to military spending, there can be no less stringent a review of where money is spent than with the rest of discretionary spending. Without a doubt there is waste in the DOD budget. Real world realities may, however, require continued high spending in order to deal with rogue countries. While that is not justification to maintain high discretionary spending too, the issue of fairness will need a full explanation if defense goes up and discretionary goes down.

These reactions, however, are not new. Many have called the GOP out on these proposals in the past. As we think about this week’s Supreme Court decision allowing even greater political donations, one finds it hard to avoid thinking that the real goals are not a balanced budget, or a more workable healthcare system, or even reformed entitlements.

The GOP number one goal must be first and foremost lower taxes and let the fall out be as it will be. Adding to that “benign neglect”, indifference towards women, gays, and immigrants, I can’t see how the GOP can expect to do better in 2014, let alone 2016.

Bluff Called?

February 25, 2014

Secretary of Defense Chuck Hagel announced yesterday deep cuts to the Army.  The cuts were characterized as reducing the size of the Army to 440,000 or pre-WWII size.  Hagel said that the Country could not afford to maintain its technological edge, and still keep so many Americans under arms.  I guess he was saying its guns and butter again.

There are several logical arguments to support Hagel’s recommendations.  New technology can do a lot more but it also costs a lot.  While no one can be sure of the next war, the last two (Afghanistan and Iraq) were wasteful uses of traditionally supported ground troops.  Special Operations, on the other hand, have demonstrated much usefulness as an adjunct to diplomacy.

Exactly how our future military should be structured, such as numbers of ships and types, planes, or tanks, is a matter for our Joint Chiefs.  Entering wasteful wars like Iraq and Afghanistan is the providence of Congress, and ultimately the American voters.  So, here comes the bluff.

The GOP has been on a one handed deficit death march by cutting only government spending.  Economists can debate whether the deficit needs to be zero or just some small number, but running at current levels north of $500 billion is unacceptable and dangerous.

The danger arises because the deficit is not the result of a deliberative process, that is a conscious decision to spend in excess of tax revenues.  The deficit represents a dysfunctional governance process.

In the best of light, Congress is divided over whether to balance the budget by reforming entitlements (like Medicare and Medicaid), or to cut all spending while increasing tax revenues.  In the poorest of light, Congress is divided by which tactics will benefit which party at the next election and has nothing to due with true deficit reduction.

Defense spending is a cornucopia for all Congress members.  A little or a lot (of government dollars) goes to each district.  The mere idea of reigning in Defense spending sends chills down the backs of our blustery Congress members.  How can they remain tough on spending and still find ways to puff up the military?

The next few weeks should be a treat if your fancy is political double speak.  We will hear more about unnamed enemies and geopolitical threats.  And, once again, Republican Chuck Hagel will be castigated by his former colleagues.  How could Hagel be so irresponsible?

Using only Medicare and Medicaid cuts to reduce government spending has been a bluff in hopes of maybe getting cuts or at the least, a “grand bargain” which includes large reforms and a few new taxes.  This bluff comes off the tracks if Hagel’s recommendations are shot down.  In the process of advocating no military cuts, those “bluffers” will be exposed for what they are.


The Deficit and Debt Blues

February 4, 2014

Can you hear that tune coming back again?  You know, “the Deficit and Debt Blues”.  It’s a sad song which shows our Congress in a shameful light.  Each time the country approaches the statutory limits on borrowing, we hear this music begin.  Have you ever wondered what our politicians are thinking?

The deficit and debt are in fact important numbers.  Failure to balance the Federal Budget leads to the deficit, and deficits piled on top of other deficits makes our debt.  Just as with our personal household budgets, credit can bridge a period when one spends more than one makes.  Also, as with a personal debt, the more one borrows, sooner or later, the more ones bank will charge more to lend you more.  Lastly, just like with personal debt, banks will continue to loan providing one continues to make payments on the loan interest.

So for either Party to say they do not support increasing the debt limit, either displays a gross misunderstanding of credit markets or a totally reckless approach to life.

The US certainly has a deficit problem.  Congress cannot agree upon the role of Government and therefore cannot agree upon how to properly fund what Government we do have.  Just weeks ago, Congress passed its first budget in several years and said in effect, this is how we will spend our money.

Now with the ink just dry, some in Congress are saying we will only agree to increasing the debt limit if there are spending concessions.  What?  Why weren’t those concessions already in the budget?

These irrational arguments over the debt simply mask the fundamental legislative shortcomings.  Both parties are only too eager to approve spending (and take credit in their home district) while leaving the funding of that spending to borrowings.  Hence the difficult to contain deficit.

Medicare and Medicaid are the prime culprits.  Combined, the US spends over $ 500 million more than it collects (via wage taxes) on Medicare and Medicaid.  Given rising healthcare costs, the aging population, and the stagnation in average family income, it should be no surprise that Medicare and Medicaid are running deficits.  Isn’t it clear that something must be done if we are to balance the budget?

Regrettably, there is agreement that something must be done, there just isn’t agreement on what.

Some would cut Medicare and Medicaid availability (largely through forcing recipients to pay more).  This seems odd since both programs were specifically established to provide healthcare to fixed income and poor citizens.  Hmmm.

Others would look to other parts of the Federal Budget and make cuts there.  Unfortunately, there are no obvious “one cut” places.  While certainly there are reductions that are possible, these cuts would not stop the pace at which Medicare and Medicaid are outspending their funding.  Hmmm.

Increase taxes is also a favorite.  Some are quick to “tax the rich” (they can afford it).  The rich, of course, will see this differently and suggest consumption taxes if there are to be any taxes at all.  Hmmm.

And a few voice will sing an entirely different song.

Instead of the “Deficit and Debt Blues”, these people propose singing the “Universal Healthcare Rag”.  With Universal Healthcare, there is no need for Medicare or Medicaid.  To be sure there is a funding issue, but with a clean sheet of paper funding can be established on a combination of premiums, and consumption and income taxes.  All other modern countries have adopted a single payer, universal healthcare system and experience about one half the per capita cost than we experience here in the US… and have health outcomes equal to or superior to those we experience.

The “Deficit and Debt Blues” is a troublesome song.  It takes us no place where the sun shines.  The Congressional children (our elected representatives) will huff and puff again.  It is a good bet that no Congress member will speak to root causes.  Therefore, we can expect this crisis to pass without any steps being taken to fix the underlying causes for the deficit.

Hmmm.  I think “ragtime” is far more optimistic than the “blues”.


When No Deal Is The Deal

December 10, 2013

Representative Paul Ryan and Senator Patty Murray have been leading an effort to find a “deal”.  The scope of the deal would include some relief for the sequester and also set spending limits for the next two years.  The objective is to avoid another government shutdown or default on the debt.  Sounds sensible if not heroic, but the substance falls quite short.

Prima facia, the country’s tax code is so convoluted it should be against the law.  Entitlement, especially Medicare and Medicaid are woefully underfunded and should constitute fiscal mismanagement to be allowed to continue as is.    A pinch here or a pinch there on the over all budget without dealing with these two big problems won’t have much impact upon the growth of the debt.

These two elements (tax reform and entitlements) constitute the heart of a political impasse.  Without tax reforms (leading to more tax revenue) Democrats will not support any other changes, especially to entitlements.  Without cuts in entitlements, Republicans won’t budge on any changes in the budget, and as an article of faith, no new taxes will be considered.

The Obama-Boehner “grand bargain” which included tax reform and entitlement cuts, seemed so obvious.  Washington, today, is deafly silent about that possibility.  While it remains an option, it certainly is not one for an election year.

The Murray-Ryan deal is the equivalent of “no deal” even if it can be struck.  Nothing happens versus the systemic problems facing a slow growing nation.  At a time when decisive handling of the nation’s infrastructure could prepare the US for global competition in the 21st century, there is no budget room and sadly, no will to deal with the future.  Just as disturbing is the blind eye both parties are showing towards healthcare.  While the Affordable Care Act promises to reduce the inequality of healthcare delivery and may slow the growth of future healthcare costs, it still leaves the US far short of more than two dozen other modern countries in cost and quality of care.  Not dealing with healthcare also leaves in place the festering sores called Medicare and Medicaid.

If Representative Ryan and Senator Murray cannot lead us to a tiny deal, how can we expect our elected representatives to deal with real game changers?