by | ARTICLES, CONSTITUTION, ELECTIONS, FREEDOM, GOVERNMENT, OBAMA, TAXES
What happens when the government uses its power to give money from one group of people to another group of people? It’s happening. It’s not supposed to happen. See, in our Constitution, the government has the right do things — limited things — in order to safeguard the rights of the people. Our Constitution relates to individual rights; it’s not a document on democracy. Unfortunately, these lines are becoming more blurred all the time.
Maybe democracy as a system of government by itself cannot work; in other words, if a democracy allows two foxes and a chicken to vote on what to have for dinner, it reveals a fatal flaw — because it allows an unfortunate outcome. Of course the two foxes are going to vote on having the chicken for dinner!
At the same time, democracy is the only best form of government if the majority protects the rights of the minority, whether it’s racial, economic, or whatever — those rights must be protected. But this applies to all. In the same way, a democracy voting to allow the lower 51% to usurp the property of the upper 49% is just as intolerable as usurping rights based on gender, religion, or race.
You can elect a Chavez or a Castro in a duly elected election, but you can’t allow him to just use the fact that he got a majority of the people’s as an excuse to abuse a minority of the people. People just can’t vote to take all the money for themselves.
You could have a referendum on whether the richest people (making over $200,000/year) should give their money to those making under $200,000. You could vote that… but not really because people also have the right to their own property. What then? How do you resolve this kind of conflict?
There is no mandatory, compulsory requirement to vote. If our Founding Fathers want to put voting in the Constitution they could have, but they didn’t. On the other hand, our Constitution specifically does not allow our government to take money from somebody and give it to someone else. Our Constitution merely gives the Federal government enumerated powers, and it in no way allows us to take money from some people and give it to someone else that the government has deemed more worthy.
When Barack Obama stated for the first time that he would take money from one group and give it to another — when he announced he was going after millionaires and billionaires to pay their fair share — it was the first time he verbally stated something unconstitutional.
In contrast, the states are allowed to make laws to do that — they don’t have Constitutions with enumerated powers as in the case of the federal Constitution.. States can legally, actually vote that more wealthy people must give money to less wealthy people. If and when that happens, people have the right to move within the United States to a different state with different laws — but yet still remain a US citizen. You can see the effect of this mentality even now, as high tax states have seen a population exodus to states that are less punitive.
So, what do when it is happening at the federal level? Vote for a new president? Perhaps that will change it. But how do we curb the effects of people receiving more and more wealth transfers and benefits? The unintended consequence of such policy is that the recipients will learn to always vote for the person that will create or continue policy that will benefit the voter in a tangible, direct, and economic way. As a result, the elections become less fair and based on being an informed citizen, and more on “How can I benefit? What’s in it for me?”
In this way, it logically follows that the argument could be made that you shouldn’t be able to vote if you have a conflict of interest. The suggestion of curtailing voting rights from those who are recipients of such egregious and unconstitutional policy is indeed drastic. But perhaps it should be a consideration for those who are too short-sided to see the long-term problems for this country — because the idea that our federal government can economically abuse a segment of the population for monetary gain is also radical.
by | ARTICLES, BLOG, BUSINESS, ECONOMY, FREEDOM, GOVERNMENT, OBAMA, TAXES
Earlier in the month, Steven Russolillo correctly reported on weak business investment as a key reason for poor economic growth. However, it was incredibly frustrating that as an economic writer, Russolillo, could actually suggest this was a surprising phenomenon. It’s not surprising. In fact, it’s downright predictable. The Obama Administration has been steadily undermining businesses for years and this is the fallout of their policies.
Even though Russolillo should have known this, he could have also easily interviewed any number of business owners for his article; if he did, he would have found a multitude of reasons for weak business investment, including 1) anti-business attitudes; 2) threats of higher taxes; 3) actual higher taxes; and 4) increased government regulations. Instead, Russolillo made the rookie mistake of only talking to fellow economists, the ones who look at data and trends instead of actually being in the trenches of everyday business activity.
Russolillo acts as if low rates are the only key to business spending; they’re not. Businesses won’t spend if they continue to feel the threat of the government’s heavy-hand. Better to keep the company stabilized than attempt to stretch and expand and invest; you have no idea what new regulation or new tax will continue to wreak havoc on your long-term business plans and cash flow — they way this administration has done for the last seven years.
Businesses are tired of being treated as an both a source of extra government revenue and a playground for intrusive, burdensome policies that hurt, rather than help, our economy. It’s a no-brainer to anyone who is anyone in the business world why businesses are hesitant to invest; it’s a shame that more economists don’t know how to engage in critical thinking and basic journalism.
by | ARTICLES, BLOG, FREEDOM, GOVERNMENT, OBAMA, POLITICS
My good friend Don Boudreaux recently wondered aloud about the possibility of a Trump presidency, where he writes,
“I can understand and appreciate why some people believe that Donald Trump would be a less-dangerous president than would Hillary Clinton. (Although I no longer hold that view, I once did. And I concede that my current reckoning of the relative risks might be mistaken.) But I cannot understand why any sensible person believes that a Pres. Trump would serve any good purpose (beyond a Pres. Trump preventing there being a Pres. H. Clinton). I cannot understand why any sensible person thinks that a Pres. Trump will diminish rent-seeking and otherwise make the U.S. government less hostile than it currently is to Americans’ freedoms and prosperity.
Pres. Trump’s politically incorrect harrumphing and mad verbal ejaculations will no doubt give heartburn to “Progressive” academics with offices on the Charles and to “Progressive” editorialists with offices in Manhattan. But so what? Is a man such as Trump – a man so ignorant of civics, so boastfully boorish, so openly contemptuous of the rule of law, so flamingly ignorant of economics, so nastily bullying, so full of nativist fallacies, so fond of (and skilled at) rousing the rabble, and so megalomaniacal – likely to be someone who does positive good does not do great harm? Uh-uh.”
On the other hand, one could argue that the most important reason to vote for Trump is a chance to not screw up the Supreme Court for generations.
If Hillary wins and brings a Democrat Congress, we are in a Socialist regulatory state. If Trump wins, with a Republican Congress, the Congress will not pass any of his agenda.
by | ARTICLES, BLOG, BUSINESS, ECONOMY, FREEDOM, GOVERNMENT, OBAMA, OBAMACARE, POLITICS, TAXES
This is an excellent editorial piece from the Wall Street Journal discussing the surprise announcement that Aetna, one of the leading insurers in this country, was withdrawing from the vast majority of Obamacare exchanges. But instead of sitting up and seriously considering this massive defection as a wake-up call (unlike all the previous failures), the Democrats want to blame Aetna itself in order to safeguard the narrative that Obamacare is working perfectly well. I have reproduced the piece in its entirety below; it’s worth the read.
“Democrats claimed for years that ObamaCare is working splendidly, though anybody acquainted with reality could see the entitlement is dysfunctional. Now as the law breaks down in an election year, they’ve decided to blame private insurers for their own failures.
Their target this week is Aetna, which has announced it is withdrawing two-thirds of its ObamaCare coverage, pulling out of 536 of 778 counties where it does business. The third-largest U.S. insurer has lost about $430 million on the exchanges since 2014, and this carnage is typical. More than 40 other companies are also fleeing ObamaCare.
The mass exodus will leave consumers consigned to the exchanges with surging premiums and fewer options, but don’t mention these victims to Democrats. They’re trying to change the subject by claiming Aetna is retaliating because the Justice Department is trying to block Aetna’s $37 billion acquisition of Humana.
The 2010 ObamaCare law makes it nearly impossible for non-mega insurers to operate, and a tide of regulations has encouraged consolidation. Aetna says the Humana tie-up will create economies of scale that could sustain the money-losing exchange policies.
But Massachusetts Senator Elizabeth Warren is now emoting on Facebook that “The health of the American people should not be used as bargaining chips to force the government to bend to one giant company’s will.” This week the Administration also released a July 5 letter from Aetna in response to a Freedom of Information Act request. Democrats claim the document shows CEO Mark Bertolini conditioning Aetna’s ObamaCare cooperation on merger approval.
This is some gall. Aetna was answering a June 28 “civil investigative demand,” in which Justice’s antitrust division specifically asked how blocking the merger would “affect Aetna’s business strategy and operations, including Aetna’s participation of the public exchanges related to the Affordable Care Act.”
Soliciting sensitive internal information that Aetna is legally compelled to provide—and then making it public to sandbag the company—is the behavior of political plumbers, not allegedly impartial technocrats. If police tried this, it’d be entrapment.
Mr. Bertolini had merely replied that the legal costs of an antitrust suit would strain Aetna’s performance. The insurer would have “no choice but to take actions to steward its financial health” and “face market realities,” such as reducing unprofitable business. Public companies have a responsibility to shareholders, and the wonder is that any insurer is still part of the exchanges.
ObamaCare’s troubles aren’t the result of any business decision. The entire industry is caught in the law’s structural undertow. Despite subsidies, overall enrollment is flat, there’s too much monthly churn, and the exchanges aren’t attracting enough healthy people to make the economics work.
Blame the law’s architects, not Mr. Bertolini, who must wonder what happened to the political goodwill he has tried to bank over the years. Aetna was inclined to accept the exchanges as loss leaders to support ObamaCare’s mission of universal coverage. The company led ObamaCare’s industry pep squad in 2009 and 2010.
The calculation then was that subsidies would open a new market, and consumers would be mandated to buy their products. But in the final frenzy to pass the law, Democrats decided that insurers made too much money and they imposed price controls on profit margins. Now insurers are accused of declining to throw away more money.
The ObamaCare implosion means that about a quarter of U.S. counties will have only one or two plans, and in some zero. Areas in Arizona, North Carolina, Pennsylvania and Texas seem to be hardest hit, though the extent of the damage is still emerging.
Democrats figure they have insurers over a barrel because a Hillary Clinton Presidency is coming. She’s running on higher subsidies for beneficiaries, a taxpayer bailout for the industry, and a “public option” akin to Medicare for the middle class. In health care the solution to a problem caused by government is always more government, which will create new problems and beget more government.
Republicans have no obligation to participate. They had no hand in creating this mess and they’ve been mocked by Democrats and the media for years for warning about ObamaCare’s flaws and trying to repeal and replace the law. Assuming the GOP holds at least the House, they should insist that any “fixes”—which are fast becoming inevitable—create a rational health-care market. Democrats deserve to be held accountable for the collapse of their ideas.”
by | ARTICLES, BLOG, BUSINESS, CONSTITUTION, ECONOMY, ELECTIONS, FREEDOM, GOVERNMENT, HYPOCRISY, OBAMA, OBAMACARE, POLITICS, TAXES
Aetna’s decision to withdraw from 11 out of 15 state exchanges is a big deal; it follows the paths of UnitedHealth Group and Humana, both large insurance companies who have also chosen to cut ties with Obamacare. (Incidentally, the DoJ is trying to block a Aetna-Humana merger; are they worried about competition?)
A short analysis by Market Watch provides some insight into the decision and the current state of Obamacare:
**Aetna explained the decision as a way to “limit our financial exposure moving forward,” after pretax losses of $200 million in the second quarter and losses totaling $430 million on individual products since January 2014. The company did not specify what portion of the losses was attributable to individual public plan offerings.
**The company criticized the ACA’s “inadequate” risk-adjustment mechanism, which is meant to limit insurers’ losses as they start covering sicker individuals. It’s a common criticism from health insurers, which have long said that the risk-pool program isn’t working the way it’s supposed to, though others say big insurance companies should instead change their model to keep costs down.
**Of Aetna’s exchange membership this year, more than half is new, with those needing expensive care making up “an even larger share” in the second quarter, the company said.
**Coupled with the risk pool, this makes premiums costlier and “creates significant sustainability concerns,” the company said.
The affect of these withdrawls means fewer insurers and fewer choices for consumers than when the law first began several years ago. That’s not good. The law needs some reform. MarketWatch notes, “The Centers for Medicare and Medicaid Services has indicated a willingness to make changes to the risk-pool mechanism, although it’s unclear whether legislation to that end would be passed.
Any fixes will also depend on strong enrollment figures. Premiums have increased for 2017, but the financial penalty for not having health insurance has also increased. Whether that penalty, an average of $969 per household, according to a Kaiser analysis, will prompt increased enrollment is a “big wild card,” according to a co-author of the Kaiser report. A rise in premium costs “suggests additional enrollment growth is not a given,” said Riggs, having potential negative implications for hospital and managed care, along with investors in those spaces.”
Will this have an impact on the 2016 election? It will be interesting to see — especially since the open enrollment period is slated to begin on November 1, just days before the 2016 election. The cost of premiums, especially if they are substantially higher, may affect people’s voting decisions. Of course, don’t put it past the Administration to delay open enrollment until Nov 15 and shift everything by two weeks, in order to avoid a “November surprise”. The only thing that’s not a surprise at this point is that the law continues to founder considerably, at the expense and disruption of everyday citizens.
by | BLOG, ECONOMY, FREEDOM, GOVERNMENT, OBAMA, TAXES
I always like to periodically check in on what’s going on in the world of federal debt and federal tax collections. The good folks over at CNS News consistently report the figures that come out of the U.S. Treasury so we can periodically see how our federal finances are doing. Here’s the latest snapshot:
During the 90 full months President Barack Obama has completed serving in the White House—February 2009 through July 2016–the U.S. Treasury collected approximately $19,966,110,000,000 in tax revenues (in non-inflation-adjusted dollars), according to the Monthly Treasury Statements.
During those same 90 months, the federal debt rose from $10,632,005,246,736.97 to $19,427,694,579,786.64—an increase of $8,795,689,333,049.67.
In July, according to the Monthly Treasury Statement released today, the federal government took in $209,998,000,000 in taxes and spent $322,813,000,000—running a one-month deficit of $112,815,000,000.
So far in fiscal 2016, according the Treasury statement, the federal government has collected approximately $2,678,824,000,000 in taxes and spent approximately $3,192,487,000,000—running a deficit of $513,662,000,000 for the first ten months of the fiscal year.
Given that the Bureau of Labor Statistics has reported that there were 151,517,000 people employed in the United States in July, the $19,966,110,000,000 in taxes the Treasury has collected during Obama’s first 90 full months in office equals approximately $131,775 per worker.
The $8,795,689,333,049.67 in additional debt the federal government incurred during Obama’s first 90 full months in office equals approximately $58,051 per worker.
The Treasury only needs to pull in another $33.89 billion in taxes to reach the $20 trillion mark for Obama’s presidency. (The $19,966,110,000,000 the Treasury pulled in during the first 90 full months of Obama’s presidency equals approximately $221,845,666,666.67 per month).
During the first 90 full months George W. Bush was president (February 2001 through July 2008), according to the Monthly Treasury Statements, the Treasury collected approximately $16,048,182,000,000 in taxes.
(From February 2001 through January 2009, the Treasury collected $17,251,191,000,000 in taxes. Bush was inaugurated on Jan, 20, 2001 and left office on Jan. 20, 2009, when Obama was sworn in.)
The $16,048,182,000,000 in taxes the Treasury collected during Bush’s first 90 full months in office equaled approximately $110,273 for each of the 145,532,000 persons who had a job as of July 2008.
During the first 90 full months of George W. Bush’s presidency, the debt rose from $5,716,070,587,057.36 to $9,585,479,639,200.33—an increase of $3,869,409,052,142.97. That equaled approximately $26,588 in added debt for each of the 145,532,000 persons who had a job as July 2008.
Here, according to the numbers published in the Monthly Treasury Statements, are the total receipts the Treasury has brought during the 90 full months President Barack Obama has completed in office:
Feb. 2009-Sept. 2009: $1,330,887,000,000
Fiscal 2010: $2,161,728,000,000
Fiscal 2011: $2,302,495,000,000
Fiscal 2012: $2,449,093,000,000
Fiscal 2013: $2,774,011,000,000
Fiscal 2014: $3,020,371,000,000
Fiscal 2015: $3,248,701,000,000
Oct. 2015 – July 2016: $2,678,824,000,000
90 Month Total: $19,966,110,000,000
by | BLOG, OBAMA, POLITICS, TRUMP
After the embarrassing Democratic National Committee (DNC) Wikileaks dump, Debbie Wasserman Schultz resigned earlier today from her position as Chair of the Democratic National Committee. Wasting no time, Hillary Clinton immediately brought Debbie onto her campaign in several key capacities. You can read the text of the press release below. It’s also available on Hillary Clinton’s campaign website.
by | ARTICLES, ECONOMY, OBAMA, OBAMACARE, TAXES
I just read a recent Letter to the Editor in the Wall Street Journal from a Francis X. Cavanaugh, “founding chief executive of the Federal Retirement Thrift Investment Board.” I guess his title allows him the ability to be an ignorant elitist, mocking the alarm of the ordinary American with the current amount of crushing US debt.
Mr. Cavanaugh writes that the “concern that ‘we have borrowed so heavily from future generations’ is baseless.” Baseless. Really Mr. Cavanaugh? As if anyone concerned with debt is a poor, uneducated, silly, misunderstood citizen, and all the smart federal people know and understand that the debt will never be paid off, never needs to be paid off, and therefore is a non-issue. How utterly wrong.
In his economic ignorance, Mr. Cavanaugh must be assuming that, as with major corporations and other organizations with indefinite lives, debt can be a part of a permanent capital structure, so there is no need to actually pay it off. But in order for the debt to be rational, it needed to be incurred to acquire something with ongoing benefit – such as land or equipment whose ongoing use will justify the ongoing debt service to pay for it.
That is the difference between the federal government and other entities that will maintain “permanent “ debt. Corporate permanent debt has funded capital improvements that will provide benefits into the future. They would never use debt to fund current operations, because this would burden future activities with having to pay back unproductive debt. In contrast, federal debt is funding only operating deficits – paying for more vote-buying crony-building current goodies than our tax receipts could provide – and which will need to be paid back by our children and grandchildren who will have received none of the goodies.And the cumulative effect of piling operating deficits on top of operating deficits is catastrophic.
Mr. Cavanaugh does not believe that the debt needs to be paid? What needs to be paid — at minimum — is the interest and the capacity to roll over the debt coming due; however, when the amount of debt explodes such as it has in the past 8 years, the interest explodes too, especially when interest incurred at historically low rates will need to be refinanced at rates much higher. Likewise, those creditors funding the debt will certainly take pause or stop funding all together. Subsequently, the interest liabilities become a debt for future generations paying for the debt service and the unfunded liabilities of the past generations’ profligate spending.
The attitude of Mr. Francis X. Cavanaugh is thoroughly repulsive — but what do you expect from a bureaucrat whose sole job was to oversee, protect, and administer the retirement savings and investment plans for Federal employees?
by | ARTICLES, BLOG, ECONOMY, FREEDOM, GOVERNMENT, HYPOCRISY, OBAMA, POLITICS, TAXES
Dear Speaker Ryan,
I write to you today to ask about why the Jones Act amendment proposed by Rep. Gary Palmer and the reasonable minimum wage exceptions were left out of the Puerto Rican assistance act (PROMESA). If the purpose of the fiscal rescue bill was to aid the Puerto Ricans suffering from a fledgling economy and corrupt government, these two items would have greatly helped the Puerto Rican people.
The Jones Act, as you know, requires that all cargo shipped between U.S. ports be carried by U.S.-built, U.S.-crewed, U.S.-owned ships. The J0nes Act puts an unnecessary burden on our U.S territories; exempting Puerto Rico from this provision would have provided a much-needed burst of commerce and lower the cost of living. As it is now, the Jones Act limits international competition for competition for imports and creates higher taxes on basic necessities such as energy and food. This recent article in the National Interest, which covers the history and impact of the Jones Act, is a must-read.
In a similar way, allowing Puerto Rico to be exempted from federal minimum wage requirements would give businesses a chance to compete without artificial wage impediments. How can it be acceptable to deny the Puerto Rican people this tool to help aid recovery, when it once allowed American Samoa to be exempted as a favor to Nancy Pelosi because of her constituent operations there? When the favor was discovered and the exemption rescinded, the damage to the American Samoa people had already been done; the amount of subsequent layoffs and hiring freezes prompted delays in phasing in the minimum wage requirements in 2010, 2012, and most recently in 2015. Why in the world would not then make a minimum wage exemption for the Puerto Rico in order to help spur more rapid job creation and economic growth?
This would be the right time for Congress to enact stand alone law exemption US territories for laws such as the Jones Act and federal minimum wage. In that way, our territories can not only manage to survive, but actually thrive.
by | ARTICLES, BLOG, ECONOMY, ELECTIONS, FREEDOM, OBAMA, POLITICS, TAXES
Here’s another ridiculous article by “economist” Grep Ip, wondering aloud once again why the economy isn’t doing any better. (“Why Aren’t Low Rates Working? Blame Dividends!” WSJ, June 5). Either he’s truly incompetent as an economist not to see the detrimental effects of government policies on businesses and the economy, or he’s playing dumb to give political cover to the Obama Administration by pretending their policies aren’t harmful and looking the other way in his analysis.
Ip writes, “One of the great mysteries of the recovery is why low interest rates have done so little to lift business investment. After all, that is supposed to be one of the ways monetary policy works: A lower cost of capital makes any project more viable. But what if lower interest rates are actually hurting investment by encouraging companies to pay dividends or buyback stock instead?”
This is exactly what is happening — it’s no mystery. But he draws no substantial conclusions. If he would just come down from his ivory tower of what is “supposed to happen” under Keynesian economics, and actually observe what is happening, he might actually learn something. The fact of the matter is, Obama’s policies are destroying our business environment and eliminating the opportunity.
The burden of overregulation, the increases in taxes, the litigation-friendly environment, the overreaching government agencies, Obamacare, unprecedented debt and more — all of these factors cause businesses to essentially pause their business strategy. Who in their right mind really would consider substantial investment in an environment that is hostile to workers, and an economy that is now seeing more businesses close instead of open? The risk is often too great. Sitting it out is a safer bet.
Not only is it not a mystery as to why low interest rates haven’t spurred growth, it’s a no-brainer. To ignore the government’s effect on business and the economy is unprofessional and incompetent. “It’s the government, stupid!”
