Posted on 06/26/2009 9:19:10 PM PDT by sickoflibs
Misguided government policies have already dealt vicious body blows to our economy, but that hasn't stopped politicians this week from launching two new kicks to the groin: a national health insurance plan and a carbon emissions regulation system called "cap and trade." Even if these plans could achieve their desired ends, which is highly unlikely, I would have hoped Washington would refrain from throwing more monkey wrenches into the economy until it shows some signs of resurgence. The last thing we need right now is to further encumber our economy with higher taxes and additional regulations.
The meteoric rise in health care costs, which has become an unending nightmare for U.S. businesses and consumers, is not an accident. This painful condition has arisen from excess government involvement in the system, tax provisions that encourage the over-utilization of health insurance, and government support of an out-of-control malpractice industry. Rather than allowing more bad policy to drive health care costs further upward, we should be looking at ways to allow market forces to reign them back in.
If left alone, the free market drives quality up and costs down. Government programs produce the opposite result. Despite the president's claim that a federal plan will bring costs down, there is no historical precedent for such faith.
Simply providing more widespread health insurance, as the Obama plan offers, is not a solution. In fact, it will aggravate the problem. Since consumers no longer pay for routine medical expenses out of pocket, comprehensive health insurance creates a moral hazard for both patients and doctors. To maximize the value of the health insurance "benefit," most workers opt for low deductibles and co-pays. Therefore, doctors learn that their patients are not concerned with the cost of care, and so they are free to bill insurance companies at the maximum allowable rates.
Given our current tax code, the simplest way to bring down medical costs would be to fully tax health care benefits as wages and simultaneously increase the personal deduction by an amount significant enough to neutralize the effect of the tax increase. This would do two things. First, the uninsured would get a huge pay increase, enabling them to buy reasonably priced catastrophic policies. Second, those currently insured could opt out of expensive employer-provided plans, trading premiums for extra wages, then buy a more economical plan. The savings would go right into their pockets.
The bottom line is that aggregate medical costs will never come down unless services are rationed more wisely. Rather than being used as a pre-payment plan for routine care, insurance should only cover unpredictable, catastrophic costs.
As a comparison, homeowners often carry fire insurance, but seldom maintenance insurance. You buy fire insurance to guard against a catastrophic loss, which is a low probability but high cost event. As a result, fire insurance is relatively affordable, since premiums paid by all those homeowners whose houses do not burn down more than pay for the losses on those few whose houses do.
On the other hand, no one carries home maintenance insurance to pay for a clogged drain or broken garage door. If insurance paid for the plumber visit every time a toilet overflowed, we would now have a plumbing crisis, and Congress would be looking to reign in runaway plumbing bills with "national plumbing insurance."
In his press conference, President Obama claimed that government insurance would not drive private providers out of business. This is absurd. As the government provider will not have to produce a profit or accurately account for its contingent liabilities, it will provide insurance on an actuarially unsound basis. With taxpayer subsidies, the government provider can run losses indefinitely. If private insurers did this, they would either be shut down or go bankrupt. Therefore, the cost of government provided health insurance will not be confined to the premiums paid, but will include the taxpayers' bill to continually bail out the government provider.
When Medicare was first proposed back in 1966, it cost $3 billion per year, and the projection was for inflation-adjusted annual costs to rise to $12 billion by 1990. The actual cost in 1990 was $107 billion, and the 2009 estimate is a staggering $408 billion! So much for government estimates on health care.
As if this were not bad enough, today the House votes on "cap and trade" legislation. Disguised as an environmental bill, this proposal would merely be another gigantic tax. The lion's share of the new revenue is already committed to politically connected special interests that will reap windfalls at everyone else's expense. To make matters worse, the bill before Congress amounts to a blank slate, with the EPA empowered to draft the details in any manner they see fit. If Congress is going to shoot the economy in the knee, they should at least be required to pull the trigger themselves.
"Cap and trade" will do nothing to reduce pollution, yet it will drive up production costs throughout the economy - rendering us even less globally competitive that we are today. In addition to the huge cost of paying the tax, its enforcement involves the creation of an entire new bureaucracy, the costs of which will be borne by American consumers in the form of higher prices.
Years of reckless borrowing and spending have left us in a gigantic hole. Getting out of it requires that we make the most effective use of all available resources. We need labor and capital to operate as efficiently as possible so we can save and produce our way back to prosperity. Unfortunately, national health insurance and "cap and trade" are two steps in the wrong direction. Rather than getting us out of this hole, they will merely cave in the walls around us.
If you realize both parties in Washington think our money is theirs and you trust them to do the wrong thing, this list is for you.
If you think there is a Santa Claus who is going to get elected in Washington and cut a few taxes and spend a few trillion and jump start the economy, and get our lost money back, this list is not for you.
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It didn’t have to happen. Republicans could have stopped the Obama Express to Socialism dead in its tracks today. As usual, they decided to screw the pooch instead.
***If Congress is going to shoot the economy in the knee, they should at least be required to pull the trigger themselves.***
But this way it makes them look more credible when they propose a “solution” down the road.
With our LW legislative morons, 'historical precedent' is somewhere between terra incognita and an insult. Their mantra is 'maybe this time we can get it right, and if we don't, it's your fault - you effed up because you trusted us'.
The real term for this is scorched earth.
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Bravo, Amen, Halelujia! This should be the Republican hymnal. Healthcare reform efforts should move in this direction only. It’s common sense to empower the individual. Anything else is un-American. All republican dissenters should be shot.
If one truly wanted to provide some minimal level of health maintenance as a public service, such as a few free screening tests at appropriate ages, etc. it could be done and wouldn't be a budget breaker. MRI scans for everyone with a backache type care will absolutely destroy us and simply is never going to happen no matter what you want to believe. So what is going on here? Well it is fairly obvious, as I posted above MSAs aren't on the table so the "healthcare reform" is really a gummint power grab. There is just no other logical explanation. The libtards want the river of cash that flows thru healthcare to be diverted through their little piece of the territory. If anyone sees some other explanation I would certainly like to hear it. Like the Monster that ate New York the gummint is just sucking up everything it can attach to is's maw. A black hole of astronomical proportions. (10 to the 12th is truly an astronomical number.)
So what will happen? Well there is no way that a plan that is unsustainable can be sustained. Eventually the hot air runs out of every balloon. How our nation and economy crashes remains to be seen but crash is inevitable with what passes for leadership.
God help our children and grandchildren because increasingly we can't.
bump
Over the past 15 years since Hillary-care went down I have come to the conclusion that the industry is SO socialized that no market based solution can compete with the current system(without dismantling it) , which is a non-starter politically. Government employees get free health care both on the job AND retirement. With medicare they make up a huge pool that can force price controls on the provider(dems call that negotiation). So if YOU try to get treatment with your MSA the provider will likely charge YOU for those in the pool. The provider also makes money on volume and YOU are a VOLUME of one.
It is hopeless sadly, gone too far , like social security is. Even republicans think they earned social security. So Democrats WON!
Thank’s Ron Paul for voting NO!!!
Maybe reinvest in America when a new Reagan looks like he might win and reverse all this socialism.
Schiff clears the murk.
Congress & The Hopium King are SO going to make all the illegal aliens legal well before the 2010 elections. And they're all going to vote Democrat.
This whole situation isn't going to end well...
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