Preserving a Viable Democracy

Our politics and policies have regressed to a level that threatens democracy.

Political Spittle: A recent email from Jim Messina, Barack has the subject “This is some sick crap.” This guy leads Obama’s political efforts. He is not some small time leftist blogger. The tone and purpose of this stuff is to enrage the gullible and motivate their hatred of some object of scorn, in this case the Koch brothers. That this language goes out under Jim Messina’s name is the same as if it went out directly from Barack Obama.

The purpose of the spittle is to inspire hatred, resentment, and envy to motivate action.

While there is nothing new about political spittle there is something new about the number of voters dependent on government to whom the spittle is targeted.

Vested Financial Interest:

I could find no study that measures the number of people eligible to vote who also receive benefits from federal programs, but can extrapolate from the above that about 90 million voters, 40% of all voters, depend on government aid and many more have family members who depend on government aid.

Stated another way, at least 40% of current voters have a financial vested interest in voting for candidates who promise to maintain or expand federal aid programs. Now add in 20 million public sector employees and about 50% of all voters have a direct vested financial interest in growing government.

Political Spittle + Financial Vested Interest = Votes

Those with a direct financial vested interest in an election outcome easily embrace false and fabricated arguments supporting that vested interest.

Fomenting hatred and resentment among those dependent on government largess is unethical, yet it has become the standard modus operandi of Democratic politics.

A republic that is trusted by the citizenry depends on independent individuals voting based on their conscience, not their financial interest. The reason conservatives must get control of the Federal government is not to lower spending, it is to lower dependency and in the process preserve our republic.

Regards, Pete Weldon

Choice Goes Begging

The realities of Obamacare bring to light the failure of our health insurance and health delivery systems, systems built on government rules rather than patient needs. This reality predates, and is only made more oppressive due to, Obamacare.

One of the big deals about Obamacare is that individual health insurance policies must be “guaranteed issue” meaning that that coverage cannot be denied due to pre-existing conditions. The other big deal about Obamacare is that every individual not covered by an employer plan is supposed to be forced to buy coverage or pay a tax (they call it a “Shared Responsibility Payment”). When you combine these two key attributes you are supposed get everyone in the game so, while everyone shares in the cost of everyone’s medical problems, the risk pool is very large and the costs therefore spread across almost all healthy and sick people.

Nice concept. Lousy reality.

Little discussed is the more important reality that no one in America has market driven choice of health insurance and delivery. Government mandates across the spectrum of health care insurance and delivery limit choice of products and procedures, and also disincentivize doctors and other medical professionals.

This post has the numbers. The realities are:

  • You are stuck with your employer’s plan, which may be very good for you but you better check the plans of a potential new employer before you change jobs. Further, many employers may drop coverages under Obamacare, forcing you into an individual “Marketplace” policy.
  • You are stuck with an Obamacare “Marketplace” policy. Use of the term “Marketplace” is something out of a George Orwell novel. There is no marketplace. There are just paper pushers selling one set of government approved coverages and requirements with add-ons that cost even more.
  • You qualify for Medicaid. You get what the government tells you are are going to get and you must go to doctors and medical facilities the government tells you to use.
  • You are 65 or older and qualify for Medicare. The government forces you to take Medicare under penalty of a rising premium for every month you qualify that you don’t enroll. Another interesting twist to Medicare Advantage and Supplement plans is that they are (with few exceptions) only “guaranteed issue” during the initial six month enrollment period beginning when you are about to turn 65. After that, you may be denied the right to coverage if you want to change your Medicare Advantage or Supplement plan or insurance provider. As a practical matter for most people, you are stuck with the Medicare choice you make when you turn 65, for the rest of your life.

Contrast the realities above with other consumer driven market based insurance products such as auto, life, home, and liability coverages. We must ask why health care is treated with such an over bearing government presence both before and after Obamacare.

You need to ask the question, “Why don’t I have any choice in the matter?”

Regards, Pete Weldon

Obamacare Is Near Death

You now have the choice not to buy health insurance.

The foundation of Obamacare is the individual mandate. That is, without the mandate it was presumed that millions of healthy people would choose to remain uninsured, driving up the cost of insurance for everyone else.

The mandate was the core issue in a case brought before the US Supreme Court. The Court upheld the mandate as constitutional.

But now, the Obama administration has effectively waived the mandate through administrative rule making.

These new rules provide waivers for almost all of Obamacare until October 1, 2016. That’s right! The one year waiver previously put in place in late 2013 is now a three year waiver.

Further, there are now 14 reasons you can avoid paying the tax (see page 9)¬†(“the Shared Responsibility Payment”) for not complying with the mandate (not buying health insurance). I love this one, “You experienced another hardship in obtaining health insurance. – Please submit documentation if possible.”

Current 2013-2014 Obamacare Marketplace sign up statistics show insufficient participation of the young and healthy to establish a self sustaining risk pool.

Now, the waiver of most of the insurance requirements until October 2016 plus the effective waiver of the “Shared Responsibility Payment” will further bias that risk pool toward the old and sick, increasing the cost to those actually purchasing health insurance. In other words, there will be little or no “shared responsibility” and the government (taxpayers) will be forced to further subsidize health insurance pricing to keep insurance companies in business (through direct payments to the insurance companies unless the Obamacare law is changed by Congress with the President’s signature). Similarly, the government will experience ever increasing pressure to control actual health care costs, limiting patient choice and disincentivizing medical professionals and health care facilities.

Obamacare is near death and it is time to pull the plug. What we now have is a comatose political contraption on life support that is costing hundreds of billions of dollars a year to provide health insurance to a few million people. By any objective measure Obamacare is a complete disaster.

The challenge now is to stop complaining and start building a truly competitive national health insurance market supplemented by taxpayer support of those in financial need through Federal catastrophic coverage and direct tax credits.

Regards, Pete Weldon

Compulsion and Freedom

Values implicit in American principles continue to be destroyed in service to power.

The source of government funding and thus power is compulsion, the threat of loss of your assets or freedom if you don’t comply.

In an American world this very power to compel carries with it the responsibility to serve for our government is of, by, and for the people. Implicit in serving the people is respect for diversity of beliefs, free markets, ownership, and rule of law.

It is clear, however, that the concept of public service is now corrupted to mean getting elected for the purpose of imposing your will on those who disagree with you.

What world do we live in when our government compels us to financially support people so they can choose not to work, compels us to buy healthcare coverage we don’t want, compels us to accept Medicare as the only healthcare choice when we turn 65, limits the amount of money we can spend speaking, selectively prohibits political speech, maintains a digital history of our personal behavior, and in the case of our current President, unilaterally changes laws to suit a personal agenda?

The world we live in now is definitely not American. It has many of the characteristics of cronyism and fascism. Large businesses, trade groups, and unions seek rents with explicit government approval while the government seeks to control the economy and control political opposition. If you have doubts see the recently passed farm bill, the 2009 stimulus bill, the Affordable Care Act, the Dodd-Frank bill, the Federal Reserve, and the IRS as starting points.

We do not live in America.

Our political leaders have sacrificed our freedoms, our opportunities, and our futures to political expediency of the moment, to getting re-elected at any cost in dollars and principle, to political bribes, to a false promise of human security that can never be purchased and can only be earned.

Where are the leaders who will stand for individual freedom and individual responsibility? Where are the voters who will elect them?

We must apply our time and treasure to the continual pursuit of American leadership if we believe in these principles for, even in America, freedom is never free.

Find candidates for political office who are committed to American principles then work and spend to get them elected.

Regards, Pete Weldon

Prioritizing: Charity or Investment

I consider myself a compassionate person who wants to help other people suffering economic distress. We have reached the point, however, where we are increasing charity dollars (transfer payments) at the expense of work, investment, and economic growth.

The responsible policy tradeoff that serves the long term interest is jobs over charity with an understanding that a safety net serves our best long term interest and that a safety net is not the same thing as perpetual charity. Mr. Obama’s rationalization that such charity is an economic stimulus ignores the question of where the money comes to pay for it as well as ignores the social costs of the dependency resulting from it.

The honest political question is whether we are prepared to forgo work, job creation, and economic growth in exchange for increases in perpetual charity. Mr. Obama’s response to the February 4, 2014 CBO report that notes an expected reduction in work expected from Obamacare/ACA subsidies is, “yes;” promoting the notion that being subsidized to the extent that we can choose not to work more or not to work at all is a good thing for our society.

University of Chicago economist Casey Mulligan clarifies reality near the end of this video clip (be sure to watch the balance of the clip from its starting point):

Transfer payments are not purchases. Charity is not work.

This issue focuses the essential political choice before us. More charity, dependency, and debt or more jobs, opportunity, and economic growth. We may be able to elect people who offer us a free lunch now but this is at the expense of our children’s future.

It is my personal hope that Americans, with the implications our President’s policies and priorities now clearly before us, will change direction.

Regards, Pete Weldon