Wednesday, June 28, 2017

'Facts Are Just The Bare Bones Out Of Which Truth Is Made'

Even the dry bones of Ezekiel can do basic math to
see the truth of federal budgeting and health care policy
So said historian Shelby Foote who was a Civil War expert and was featured on Ken Burns' PBS documentary on that topic.

Here's some observations and guidelines to use when trying to evaluate the merits or demerits of the currently-extant ACA or the House Republican to change it, AHCA or the American Health Care Act or the Senate Republican plan, BCRA, the Better Care Reconciliation Act:

  1. Never argue with anyone who doesn't even know what these acronyms mean; if they don't, it means they have not read any of them at all on their own.
  2. Never argue with anyone who can't refer to any underlying basis of fact from any accredited most-likely government source such as the CBO (Congressional Budget Office), GAO (Government Accounting Office) or BLS (Bureau of Labor Statistics) among about 20 others.
  3. 'Never argue with stupid people. They just drag you down to their level and beat you with experience'--Mark Twain.
You really are not going to get a full picture from the news media nowadays either so don't rely on them for any in-depth understanding or knowledge of the health care system in America or any of proposed solutions. Many if not most of major American news outlets today rely on the same talking points put out by the respective national political party apparatchiks in Congress and print them as 'real news' when in fact, they are pure political spin gruel.

So don't eat it. It is bad for your mental health.

Here's some basic 'bare-boned facts' you need to know so you can find the truth on your own and not have to rely on cable or network news which seems to have put ratings and business concerns ahead of nuts-and-bolts basic journalism which is so important to the workings of a democratic republic such as ours:
  • There is a limited amount of money taxpayers are willing to part with to pay for national, state and local public policy needs and goals. Any time someone says: 'Just raise taxes then!' you can dismiss them as starry-eyed dreamers who really don't even know what is currently being paid in taxes to support current government as it is today.

    Federal tax revenue has stayed at roughly a fairly even level of 18.5% of GDP for the past 40 years and counting. There is no reason to believe that all Congress and the President have to do is snap their fingers and pass higher taxes...and Americans will blindly and blithely go along with them without trying to find ways to avoid paying them. It just won't happen.

  • Add in local and state taxes and over 40% of our national GDP is accounted for by taxation. It was half that in 1940 and half that amount again in 1914.

    Our Founders must be doing head-spins in their graves.
  • There is a limited amount of money that can be borrowed from overseas or from private sources. Foreign investors just won't send another $100 trillion or so of their money to the United States 'just because we are the United States of America and nothing bad will ever happen to our currency or economy!"

    They aren't that crazy. Bond market investors, domestic and foreign, understand the risks of lending capital to countries that overspend their revenues and what that can do to the underlying currency valuations and ability to repay those enormous debts.

    We have written about this for almost a decade now but we now have over $20 trillion of federal debt to pay back somehow which represents close to 100% of annual GDP.

    In 1980, federal debt accounted for 32% of annual GDP. High debt-to-GDP ratios are typical of war time eras. Peace time eras are the time when national debt is usually paid off or reduced as a percentage of GDP through economic growth.

  • We can't spend every available tax dollar on Medicaid in expansions across the nation. Just like we can't pay every available dollar on Medicare, Social Security, defense or welfare programs.

    Although pretty soon, 100% of every available tax dollar we bring in each year, as in the year 2025!!!!, WILL be spent on some combination of Social Security, Medicare, Medicaid and interest on the national debt...AND NOTHING ELSE!

    Every dime we spend on new aircraft carriers, fighter jets, homeland security, environmental protection, welfare, housing, education, transportation, R&D will have to be borrowed from somewhere. Even though we will be way over the 100% of debt-to-GDP ratio most observers deem as 'dangerous' fiscal territory for any nation.

So, what does this all mean for the AHCA, BCRA and ACA?

It means 'something has to give'. We are not fighting about politics or philosophy right now.

We are fighting basic math and arithmetic. And the forces of economic reality that have not been overturned yet.

Here are two articles worth your read that are too extensive to explain right now, both by Avik Roy written in Forbes:

But read them with the context of these 'bare-boned facts' stated above in your mind so you will begin to understand the critical nature of doing health care reform the right way.

2 truly revolutionary things are in the Republican alternatives:
  1. Reverting total control of Medicaid spending and policy back to each state.
  2. Adjusting the tax credit part of buying health care insurance to a level where most people could afford to use it rather than face an enormous $10,000+ or more per year financial 'cliff' that would otherwise force them to just do without health insurance in the first place.

    More on both these articles later.
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Friday, June 16, 2017

People Who Believe 'Government Can Solve Everything' Obviously Have Never Worked In It

'Don't You Want Someone To Love?'
We were talking to a decided liberal the other day who has been pretty adamant about his opposition to any budget cuts proposed under President Trump and the Republicans.

He was complaining about the difficulties he had been facing as he was working with various government agencies in Washington and various states to get an alcohol and drug remediation program funded not over the past 6 months but the past 10 years, 8 of which were under President Obama.

'I hate the government!' he exclaimed. 'You can't believe how many hurdles and blockades we have run into getting this program going!' he huffed.

'But you are the one who LIKES more government, aren't you?' we humbly asked.

'Not in this case!' he stormed.

Welcome to the party, pal.  The party of the 'real world' of human nature versus the esoteric theoretical 'world' of postulations and lofty expectations for what government can or should possibly do.

Before you start screaming about any federal or state government budget cuts proposed by President Trump or the mean old Republicans in any legislature, ask yourself the following questions:

  1. Do you think every government program ever passed should be funded in perpetuity forever and ever and ever regardless of the actual results of the program? 
    'Oh, no! Not another immortal federal program!'

    In that case, we should still be funding a federal bounty program to kill wolves in the West, a program that started in the 1800's and was only stopped in 1965.

    Which would be totally ridiculous, yes?
  2. If a government program has achieved its stated purpose, should it be dissolved or continued?

    Our very favorite example of this wasteful spending of your tax dollars has been and always will be the Federal Helium Reserve Act of 1925.

    What was helium used for back then, you ask?

    Filling surveillance dirigibles for war purposes, of course. Blimps. Like the one that just crashed at the US Open yesterday by the way.

    Care to guess when this program was finally stopped by Congress?

    1996. Except that it was not 'finally stopped' then either. It is still with us in 2017 as amendments were passed to continue the program for some unknown reason.

    Unless we have figured out a way to use helium to produce a cloaking device on all stealth bombers and fighters, the strategic military use of helium has long gone the way of the dodo bird and passenger pigeon. And still, Congress has some of your tax dollar going to support this program.
  3. If a federal or state government program HAS NOT 'solved' the targeted problem it was aimed at, should it be continued or changed, amended or eliminated?

    LBJ's grand idea, The Great Society, was a slew of anti-poverty programs passed in 1964-65 designed, in LBJ's words:

    "(The Great Society) rests on abundance and liberty for all. It demands an end to poverty and racial injustice, to which we are totally committed in our time. But that is just the beginning.”

    $22 trillion adjusted-for-inflation of your tax dollars have been spent to eradicate poverty and lift everyone up economically since 1964 and the poverty rate remains the same, if not higher.

    A various array of social and societal ills still beset our nation, some of which have been exacerbated by the very Great Society programs that were intended to fix the problems, not complicate them.

    Should all of these programs be continued without question or concern? Or should all of them be subject to serious public oversight by our elected representatives in Washington to see which should be continued, which should be amended and which should be ended forthright?
If you had ever worked inside of the federal government, or the state or local government for that matter, you would know what we are talking about. Looking to government to 'solve everything' might be an enticing dream from the 'outside looking in' but from the inside, government in many cases 'just ain't what it is cracked up to be'.

Hence, one of the reasons why we are for less of it. Not more.

The problem with turning to government to 'solve everything' ignores the fact that government workers are human beings, just like you and me, all with their various human quirks and foibles who respond to incentives and avoid pain and risk just like we all do.

Sometimes, as in the case of The Manhattan Project or NASA landing a man on the moon before the end of the 1960 decade, government workers and contractors can pull off the most outlandish, impossible-sounding feat imaginable. Many times, however, government becomes the slow drag on progress, a never-ending cycle of delay, obfuscation, over-regulation and diversion of responsibility and nothing of any great consequence ever 'gets done' as our friend above lamented.

They are not all angels, although a few may be from time to time. They are not all rocket scientists, great financial money managers, detail-oriented task solvers or even nice people all the time.

Just as in any business, school, academic of higher learning, science lab, gas station or church setting.

Almost all government workers, as well as all of us outside of government, respond positively to praise and possibilities for personal advancement either through promotion, higher pay or bonuses and negatively to harsh criticism and perceived unfair treatment by superiors.

It is just human nature.

We are of the opinion that there is not one federal government program that can not be reduced in spending, except the amount of money we are legally obligated to pay each year for interest on the burgeoning national debt, now at $20 trillion and still climbing.

If you accept the notion that the federal government budget is not a sacred text handed down from on high and can, and should be, inspected thoroughly as noted above, then you should join the effort to reduce federal spending whether you are an avowed liberal as our friend above or a committed conservative as any Tea Party person might be.

Uniting to reduce unnecessary federal spending across-the-board should be one thing we should all do this year and every year.

Just let us know if you are interested in learning how to do it. Here's a place to start for your summer reading at the beach: CBO Options for Reducing the Deficit 2017-2026.

Read it with a cold Corona Extra or margarita nearby. You are gonna need it.

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Friday, June 2, 2017

'We Will Always Have Paris (Accords) To Deal With'

We wrote several posts over the past couple of years that basically asked this question of supporters of President Obama's executive actions and unilateral agreement-making through the White House and not with the cooperation of the US House or Senate:

'Will you be just as happy to see a Republican President in the White House use those very same executive unilateral powers to A) unwind all of President Obama's executive unilateral actions and/or B) bind the US to policies that only he and a minority of his political party want to see passed?'

The Paris Climate Accords are just the latest casualty of that failure to adhere to the US Constitution as currently written. What was written and signed essentially by one man in the 3-part governing system of the United States has now been upended by another man with the stroke of a pen and 1 press conference.

Is that really the way the Founders wanted to see us run this country, essentially through one-man rule from the White House?

Setting aside all of the arguments for and against controlling carbon emissions, what should President Obama have done to make sure the US would abide by and adhere to the Paris Climate Accords: 

Submit it to the US Senate for ratification as a treaty.

Sure it would have been difficult to get it through the US Senate and get the 2/3rds votes necessary for ratification.

But passing legislation and treaties in the United States has never been easy. Nor should it be. The process is set up to insure that legislation duly passed by majorities and super-majorities last for a long time.

Consider the enormous challenge faced by President Abraham Lincoln when he wanted to pass the 13th Amendment to the Constitution to abolish slavery. The process started in the Senate in 1864 before the elections that fall when it looked like President Lincoln might lose because of the duration of the Civil War.

However, in the midst of the bloodiest war our country has ever experienced in terms of loss of life for American soldiers and citizens, President Lincoln lobbied and cajoled and persuaded enough House and Senate members to get to the 2/3rds majority necessary to send the amendment to the states for ratification.

If you saw the Steven Spielberg movie 'Lincoln', you will remember that passage of such controversial legislation was not based just on lofty philosophical musings and speeches but on cold hard deal-making, job offers and political jockeying.

That is the 'real world' of politics and legislation. It does not operate in a vacuum or in some sterilized laboratory somewhere. It happens on Capitol Hill and in all state legislatures and municipal government councils and commissions each and every day.

President Obama chose not to do the 'dirty work' of passing such a controversial piece of legislation, this time in the form of a binding US treaty, to ratify the Paris Climate Accords that only he signed, not the US government as a whole.

Just to say that is is 'too hard' to pass something through the Senate or Congress is not enough to justify not trying to get it done. Not trying to pass something because it will be difficult to pass is, quite honestly in our constitutional form of governance, lazy. It also goes against close to 241 years now of American history where a lot of things appeared to be too hard to try to change only to see those things actually change and improve through the fortitude and leadership of just a few key people.

Our guess is that President Trump and his team will change some of the terms of the Paris Accords, particularly in the area of synchronizing the effective dates of compliance so that China and other nations all start on the same date as the United States, and then resubmit them to the other partners for their consideration.

Remember: This President wrote a book called 'The Art of the Deal'. Other signatories to the pact say that 'The Paris Accords can not be renegotiated!' which is a little silly when you think about all of the bills, treaties and agreements that have been rewritten and renegotiated over time.

It is hard work. But it can be done.

So, so far into 5 1/2 months of President Obama's retirement, thousands of his unilateral executive actions have been reversed or canceled in their entirety; thousands of pages of regulations put forth by his Administration are now being unwound or reversed by the new Administration; his ban against the construction of the Keystone Pipeline has been lifted; his fuzzy 'red line' drawn against Syria has been obliterated and now his unilateral acceptance of the terms of the Paris Climate Accords has been reversed.

You know the only thing that has not been reversed yet, for those who supported President Obama and his term in office?

The Affordable Care Act. Obamacare.

You know why?

Because it was, contrary to so much else done under President Obama's two terms in office, duly passed through both the US House of Representatives and the US Senate and signed into law by President Obama in compliance with the US Constitution.

Until a majority of the US House and US Senate can pass something to either repeal it in its entirety or replace it with something else, the ACA will remain the law of the land.

Keep that in mind next time you cheer on a US president who says he or she is signing this or that in the name of the United States of America.

Because, as we are now seeing in the aftermath of President Obama's executive actions, they won't last for very long. Especially when the other side wins the next election.

We have a Constitution for a reason. Read it every now and then to remind yourself of the incredible foresight our first generation of elected leaders had to look far into the future and implement ways to limit the powers of one person in this country to run things without the consent of the majority of citizens as expressed through elected representatives, not public opinion polls.

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