by | ARTICLES, OBAMA, OBAMACARE, POLITICS, TAXES
So, the Supreme Court ruled yesterday that ObamaCare is constitutional because it is a tax. That settles it, right?
Not so fast.
On Friday, the day after the ObamaCare ruling, White House Press Secretary Jay Carney insisted the fine is still just a “penalty”.
Carney went on to say Friday that the “penalty” will affect only about 1 percent of Americans, those who refuse to get health insurance. He said the penalty was modeled after the one put in place in Massachusetts when Mitt Romney was governor.
“It’s a penalty, because you have a choice. You don’t have a choice to pay your taxes, right?” Carney said.
Carney was initially reluctant to assign a label to the fine when pressed repeatedly by reporters Friday. “Call it what you want,” he said.
and more:
“You can call it what you want,” he said. “If you read the opinion, it is not a broad-based tax. It affects one percent, by CBO estimates, of the population. It is not something that you assess like an income tax.”
It was unclear which Congressional Budget Office estimate Carney was referring to. Despite being pressed on the issue, though, the spokesman would not relent.
It didn’t even take 24 hours for the games and backtracking by the White House to begin. Don’t forget, they insisted to the American people — in order to get the bill passed — that it was not a tax. Clearly, they are worried about the tax narrative shaping the rest of the election season rhetoric.
by | ARTICLES, CONSTITUTION, HYPOCRISY, OBAMACARE, POLITICS, TAXES
The WSJ editorial this morning, The Roberts Rules, was excellent — as it dissects the inconsistencies within the ObamaCare decision. Read it through, but here are some highlights:
The remarkable decision upholding the Affordable Care Act is shot through with confusion—the mandate that’s really a tax, except when it isn’t, and the government whose powers are limited and enumerated, except when they aren’t.
and this:
The Chief Justice ruled that ObamaCare’s mandate violated the Commerce Clause, joined by the Court’s conservative bloc, but he also said that the mandate fell within Congress’s power to tax, joined by the Court’s liberal bloc. In practice this is a restraint on federal power without real restraint—and, worse, the Chief Justice had to rewrite the statute Congress passed in order to salvage it. The ruling will stand as one of the great what-might-have-beens of American constitutional law.
more:
According to Chief Justice Roberts, the penalty is merely a tax on not owning health insurance, no different from “buying gasoline or earning income,” and it thus complies with the Constitution. This a large loophole.
and this:
But if the mandate is really a tax, why doesn’t the law known as the Anti-Injunction Act apply, which says that taxes can’t be challenged legally until they’ve been collected? The Chief Justice actually rules that the mandate is a tax under the Constitution and a mandate for the purposes of tax law.
Additionally, the WSJ lent some more credence to the assertion that Chief Justice Roberts was actually in agreement with Scalia, Thomas, Kennedy, and Alito (giving a 5-4 strikedown), but at the last minute changed his mind. “One telling note is that the dissent refers repeatedly to “Justice Ginsburg’s dissent” and “the dissent” on the mandate, but of course they should be referring to Ruth Bader Ginsburg’s concurrence. This wording and other sources suggest that there was originally a 5-4 majority striking down at least part of ObamaCare, but then the Chief Justice changed his mind”. This theory was floated yesterday first by Paul Campos and Brad Delong who noticed language confusion and tone changes in the opinion. Their ideas are examined more in depth here.
Now that we have a both a scrutiny of the dissonance and a peek at some silver linings, where do we go from here? It is clear that November must be our top priority — both at the Presidential level and Congress, especially the Senate. And then, we’ll see whether American can be preserved.
Update #1:…and the White House (Jay Carney) is already insisting today that it is NOT A TAX
by | FREEDOM, OBAMACARE, POLITICS, TAXES
There are a few good aspects of the Supreme Court ruling, which upheld the ObamaCare mandate as a tax. Among them are 1) the deception by which Obama’s administration passed ObamaCare in Congress; 2) the preservation of the Commerce Clause; 3) the ease at which ObamaCare can now be repealed and 4) the invalidation of the Medicaid expansion, which upheld State’s rights and may ultimately undermine the entire efficacy of ObamaCare.
For the first time in history, a major piece of legislation passed Congress as an intentional deception of the American electorate. The only way this law was passed in March 2010 was the result of a clear and patent lie by the Obama Administration. ObamaCare supporters, including the President himself, repeatedly and emphatically denied that ObamaCare was a tax, and instead pointed to the Commerce Clause to validate its existence. Then, in front of the Supreme Court, the Obama Administration argued that ObamaCare was a tax. “Taxation Without Representation?”. This bait-and-switch tactic must be relentlessly hammered home between now and November. Between Obama’s aggressive use of the Executive Order and now this clear example of deceit, the American citizens must be continuously reminded that Obama will use any tactic to get what he wants — and is a tax-raiser too.
That being said, the Supreme Court opinion gave us five clear votes that this law would not have passed muster under the Commerce Clause. Thus this ruling clarified, strengthened and protected the Commerce Clause while establishing a precedent from further Congressional usurpations. The Supreme Court has now firmly stated Congress does not have the power of commerce coersion. It also upheld the separation of the three branches of government – that it was not the Supreme Court’s job to prevent Congress from passing a bad law (and thus a check against overt judicial activism); rather its function was solely to interpret the constitutionality of said law. ObamaCare however, is still bad law.
Furthermore, ruling that ObamaCare is a tax creates the opportunity for a simpler repeal than if it was considered valid under the Commerce Clause. Here’s how: the ObamaCare mandate is now a constitutionally established tax to be levied. It becomes revenue provision of a budget, and therefore can be subject to the Budget Act’s reconciliation process. During such a process, the number of votes necessary to appeal it is a simple majority: 51 votes. Ironically, this reconciliation process was the same procedure that the Democrats used to pass the bill in Congress. Ultimately then, an ObamaCare repeal would not be subject to the filibuster process.
Finally, the Medicaid provision may be the lynchpin for undermining ObamaCare’s efficacy. Remember, the reason so many states sued the Administration was because the Medicaid expansion program would have caused severe fiscal distress to the states while simultaneously creating expansive and coercive Federal spending power over States Rights. Thankfully, the Supreme Court ruled that the such an act was unconstitutional. Therefore, this established that not only can the federal government not compel the states to participate in expanding Medicaid, it also cannot withhold existing funding for it as a punishment. States can now decline to participate. So, what happens if enough states do just that?
Even though ObamaCare was not struck down in its entirety, the rulings on various parts of the law had some positivity. It preserved the integrity of the Commerce Clause while simultaneous restricting the federal government’s ability to coerce spending onto states. Firmly establishing ObamaCare as a tax greatly enhances its probability for successful repeal, and also stamps Obama and its Congressional and political supporters as tax hikers for the November election. All in all, not an entirely bad outcome for a very bad piece of legislation.
Update: Here’s a take on the dissonance in the ObamaCare Ruling
Update x2: Jay Cost over at the Weekly Standard has a good analysis as well.
by | CONSTITUTION, FREEDOM, POLITICS, SOCIAL SECURITY, TAXES
The act of defiance of our President against our Constitution and Congress is the latest in a string of executive activism that defines Obama’s administration. The content of the Dream Act is, in and of itself, not that controversial. What Obama announced was a policy very similar to Mark Rubio’s undrafted legislation that was expected to enter Congressional debate very soon. Instead, the controversy lies with Obama’s blatant disregard for the proper function of our government.
The astonishing thing is that Obama didn’t even try to work with Congress. Remember, Obama was the guy who was supposed to bring everyone together – and he just ran roughshod over everyone. Now compare Bush to Obama. I’m not much of a fan of Bush in general; however, he did try to get his somewhat unpopular ideas passed through Congress – and a fairly hostile Congress at that (remember Social Security reform, immigration reform, etc). Yet Bush didn’t circumvent our Constitution – and he wouldn’t have even considered the idea. Obama, on the other hand, did precisely that, with no attempt to work together, and no notice that the Executive Order was coming other than a few hours prior to a press statement.
With this action on a very volatile and polarizing issue, Obama is purposely catering to a particular voting bloc in order to gain for himself the election in November. He attempted this with his HHS mandate, expecting the majority of women to support his initiative…which he found was not quite the case. What’s next? Speculation has it that it will be marijuana legalization in October, mainly to bring independents, youths, and libertarians to the voting booth.
It is not the issue itself –immigration — that is the problem in this case. Rather, it is the willful disregard for our Constitution for the sake of an election power grab. Obama has demonstrated that he is willing to toss aside our founding document on a major and specific issue as a means to sway a large segment of the population. If Obama can cheapen the presidency by begging for donations vis-a-vis gift registries, and if he can imperialize the presidency through his continued unchecked actions, this country is in grave danger for November. Obama doesn’t have to commit blatant voter fraud anymore; he merely has to Executive Order it done.
by | ARTICLES, ECONOMY, POLITICS
Poverty spending is up 41% since the start of the Obama administration, according to a recent study by the Cato Institute. The poverty rate remains at 15.1%, which is the same rate it was in 1965, when LBJ declared his “War on Poverty”.
The poverty rate since then has hovered in the 11-15% range since then; the only time it fell below 11% was a short time in the 1970s. In FY2008, federal anti-poverty spending totaled $475 billion dollars. For FY2011, spending was $668 billion in 126 anti-poverty programs.
According to Cato,
The study faults the way poverty programs are designed, saying that the increase in spending and largely unchanged poverty rate showed that the issue is not a matter of money, but a matter of what the programs aim to achieve.
“The vast majority of current programs are focused on making poverty more comfortable – giving poor people more food, better shelter, health care, and so forth – rather than giving people the tools that will help them escape poverty.”
Instead, the study recommends refocusing anti-poverty efforts on keeping people in school, discouraging out-of-wedlock births, and encouraging people to get a job – even if that job is a low-wage one.
Trillions in debt. Nearly 50% of taxpayers don’t pay federal taxes. Uptick in anti-poverty spending with no tangible results. What will Obama do next?
by | ARTICLES, ECONOMY, POLITICS, TAXES
Food stamps cost taxpayers $80 billion a year, but how those funds are spent by the recipient remains largely unknown
Food stamps can be spent on goods ranging from candy to steak and are accepted at retailers from gas stations that primarily sell potato chips to fried-chicken restaurants. And as the amount spent on food stamps has more than doubled in recent years, the amount of food stamps laundered into cash has increased dramatically, government statistics show.
Information regarding how and where the funds are distributed apparently can’t be released due to federal rules.
When a FOIA attempt was made to state officials in Maryland — the request was denied: “the information belonged to the federal government, which instructed states not to release it”. Furthermore, when the Washington Times inquired about how and where the food stamps funds are disbursed, the Times was offered the information — for $125,ooo. The USDA also keeps the program under tight wraps, and would not disclose any information.
The Washington Times concluded,
As a result, fraud is hard to track and the efficacy of the massive program is impossible to evaluate.
So there you have it — your tax dollars, unaccounted for. Surprised?
UPDATE: “>The USDA suggests Food Stamp Parties and games to increase participation
by | ECONOMY, OBAMACARE, POLITICS, TAXES
FLASHBACK: Don’t forget that the House voted to repeal the Medical Device Tax on June 7, 2012 with “H.R. 436, the Protect Medical Innovation Act of 2012”. The Senate never did — not then, not now. Who’s looking out for businesses? See my post from June 2012:
This little-talked about tax seems to be absent from news coverage. Are media outlets are avoiding discussion of Obamacare items in advance of the Supreme Court ruling expected later this month? In case you missed it, on June 7th, the House voted 270-146 to repeal the medical excise tax. The bill must now pass the Senate, where current speculation is that it will not pass.
What is the medical excise tax? Medical device manufacturers employ 360,000 people in 6000 plants across the country. This law imposes a new 2.3% excise tax. It exempts items retailing for <$100. [Bill: PPACA; Page: 1,980-1,986]
Many are ardently opposed to the new tax, and rightfully so. As an excise tax, it taxes gross sales – even if the device company doesn't turn a profit that year. Note: this tax is one of many slated to go into effect January 2013.
As a revenue raiser, its impact is nominal. The government speculates it could raise $20-$30 billion. Though that sounds like a lot to you and me, it's a drop in the bucket in terms of government revenue.
Furthermore, from an business perspective for the companies subject to this tax, the extra resources needed to comply will be burdensome for companies. Price changes and paperwork will take time and manpower away from the company's main purpose -- to produce a product -- in order to handle this new regulation.
From a common sense perspective, why would the federal government want to make medical devices -- which save lives -- more expensive? Will the Senate support small businesses and repeal an unnecessary, expensive, and burdonsome tax? The House has done so. The Senate should follow suit.
by | ECONOMY, FREEDOM, POLITICS, TAXES
From an article in the Washington Post:
The net worth of the American family has fallen to its lowest level in two decades, according to government data released Monday, driven by a more than 40 percent drop in their stakes in their homes.
The Federal Reserve’s detailed survey of consumer finances showed families’ median wealth plunged from $126,400 in 2007 to $77,300 in 2010 — a 39 percent decline. That put them on par with median wealth in 1992.
The Fed’s data underscore the depth of the wounds of the Great Recession and how far many families remain from healing. The median value of Americans’ debt did not change between 2007 and 2010. Meanwhile, the housing market crash inflicted particularly severe damage, with the Fed showing that the median value of Americans’ equity in their homes plunged 42.3 percent between 2007 and 2010.
The survey is conducted every three years, and this report offers one of the most exhaustive looks to date at the greatest economic upheaval in a generation. Although there have been some signs that the recovery has picked up steam — housing prices have begun to stabilize and unemployment has fallen — Fed economists said those improvements largely do not change the survey results.
“Recovery from the so-called Great Recession has also been particularly slow,” the Fed said in its report.
And yet, spending has increased at a greater rate than has even been seen in the history of this country. Spending, on the backs of the taxpayer. No wonder we are poorer. We are shouldering a staggering amount of federal debt.
by | ARTICLES, ECONOMY, POLITICS, TAXES
From the WSJ:
U.S. stocks posted their biggest losses of the year following another disappointing employment report.
The Dow industrials sank 274.88 points, or 2.2%, to 12118.57, turning negative for the year. The Nasdaq composite lost 79.86, or 2.8%, to 2747.48. The S&P 500 fell 32.29, or 2.5%, to 1278.04.
Gold prices shot up 3.7% to $1,620.50 a troy ounce. The yield on the 10-year Treasury note fell to 1.467%, its first time ever below 1.5%. Crude-oil slumped 3.8%. The dollar retreated against the euro and yen.
However, want some really sobering numbers?
Go down to International Stock Markets and start looking at their 1-yr % change.
Spain? 41.34% of their stock value GONE.
Italy? 36.84% of their stock value GONE.
France? 25.58% of their stock value GONE.
Britain? 11.27% of their stock value GONE.
Canada? 16.02% of their stock value GONE.
Argentina? 28.95% of their stock value GONE. (remember them? Right now they are denying devaluation speculation)
Hong Kong? 21.45% of their stock value GONE.
China? 13.49% of their stock value GONE.
Japan? 13.16% of their stock value GONE.
Israel? 15.03 of their stock value GONE.
Egypt? 15.15% of their stock value GONE. (didn’t they just have a revolution? On par with Israel…)
The U.S. Dow Jones? Down a mere 3.14%
I don’t think we’ve seen numbers such as these since the Great Depression or the fall of Rome. Worse, this is all being done on speculation on the Greek market’s impact on the Euro.
Two things:
(1) The world markets are tanking and that “full faith and credit of the United States” on your money is what’s keeping America afloat.
(2) You should be investing in precious metals if we don’t get a budget out of Congress by the end of the year. Not gold and silver, either… but copper and lead.
Between the federal statutory debt limit and the November Presidential elections, Autumn 2012 is certain to be just as volatile.
by | ARTICLES, ECONOMY, OBAMA, POLITICS, TAXES
The folks over at CNS news had a little article about our current federal debt. They pointed out that federal debt is currently $15.709 trillion.
They went on to calculate that since March 4, 2011, the federal debt has increased $1,526,126,486,886.61.
The first spending deal the White House and leaders of both parties in Congress made last year was on March 2. On that day, the president signed a continuing resolution to keep the government funded past March 4, when the previous continuing resolution, passed by a lame-duck Congress in late 2010, expired.
The March 4 CR kept the government funded for two weeks and was approved by a bipartisan 335-91 vote in the House and a bipartisan 91-9 vote in the Senate.
Since that March 4, 2011 bipartisan continuing resolution, the federal government has been funded by a series of bipartisan deals cut between the White House and congressional leaders.
They further tabulated the debt per household since the first Continuing Resolution:
Given that the Census Bureau estimates there are about 117,538,000 households in the United States, the per household increase in the federal debt since Congress enacted its March 4, 2011 bipartisan spending deal has been approximately $12,984.
This got me thinking about some more facts and figures:
If the total debt it 15,709,000,000,000.00, and there are 117,538,000 households in the United States, each household is responsible for $133,650.39.
Given that the US Population Clock records that there are 313,582,673 persons in the United States as of today, each person is responsible for $50,095.24
Given that it is estimated that 46% of households either paid no federal income tax in 2011 or will receive more from the IRS than they pay in, that means 63,470,520 households (54%) did. If you divide the entire debt per taxpaying household, each is responsible for $247,500.72 of the total debt, or an increase of $24,044.65 since last March. (14 months ago)
The next statutory limit on our debt $16.394 trillion, so we’ve got another $685 billion to go. Some have estimated the debt limit will be reached before election day, around October 15. A February 2012 study by US Senator Rob Portman, former director of the OMB, has noted that,
“Following the contentious debt ceiling last August, President Obama promised that he would take action to address the country’s fiscal crisis. He has failed to do that. In fact, his new budget increases spending and projects that Washington will be hitting the debt ceiling again in mid-October – burning through a $2.1 trillion debt limit increase in just over 14 months. This is an unfortunate but clear signal to the American people that Washington is spending too much, borrowing too much, and putting our nation’s fiscal stability at risk.
So some final calculations here.
By around Election Day, the total debt of the United States will be $16,394,000,000,000.00 ($16.394 trillion).
Based on today’s (May 20th) population numbers,
That’s $55,279.67 per person
That’s $139,478.29 per household
That’s $258,293.14 per taxpaying household
Pretty sobering.
