Vote Blue, Go Green, Ruin Britain (UK Telegraph)

James Delingpole

James Delingpole is a writer, journalist and broadcaster who is right about everything. He is the author of numerous fantastically entertaining books including 365 Ways to Drive a Liberal Crazy, Welcome To Obamaland: I've Seen Your Future And It Doesn't Work, How To Be Right, and the Coward series of WWII adventure novels. His website is www.jamesdelingpole.com.

 

By James Delingpole Politics Last updated: June 10th, 2011

799 Comments Comment on this article

And yet at Oxford he was so sound....

Sometimes it takes a trip abroad properly to ram home just how screwed your country is. And so it proved when, on the deck of a Baltic cruise ship, I first read reports of Scottish Power’s dramatic gas and electricity price rises. Instead of experiencing a wave of fury, as no doubt I would have done at home, what I felt instead was the sort of detached, sardonic amusement an alien might feel on viewing from outer space a once-great civilisation destroying itself over an issue of immeasurable triviality.

That issue, of course, is “Climate Change”. Never before in history, I doubt, has so much money ever been squandered, so much suffering and poverty exacerbated, so much economic damage been inflicted, so many lies promulgated and so much environmental destruction wrought in order to deal with a problem so microscopically miniscule. Really, if Barack Obama were to declare war on Belgium because he’d always found Tintin Au Congo offensively racist, or if David Cameron were to launch a nuclear strike on Mykonos because all those white-painted buildings were “way too gay”, you still wouldn’t be even half way close to equalling the quite breathtaking stupidity, purblind ignorance and suicidal wrongheadedness of the disasters currently being inflicted on the world by our boneheaded political and administrative classes on their holy mission to “combat climate change.”

Let’s concentrate on the British example since, thanks to Cameron’s determination to lead the “greenest government ever”, we’re further down the road to Eco Hell than most, and let’s look at the reasons behind those electricity and gas price rises.

These are outlined here in this must-read piece by the Global Warming Policy Foundation’s Benny Peiser, which lists the various mechanisms (Renewables Obligations, European Emissions Trading Scheme, Feed-In Tariffs, etc) which, this year alone, will drive up our domestic energy bills by around 15 per cent and business energy costs by 20 to 25 per cent. Every one of these mechanisms is based on the so-far-very-much-unproven hypothesis that Anthropogenic Carbon Dioxide emissions are contributing dangerously to “Global Warming” and that this “Global Warming” is an undesirable thing. In other words, our political classes are imposing on both our domestic expenses and on the broader economy swingeing costs whose sole justification is the threadbare theorising of a small number of heavily compromised scientists brandishing dodgy computer models.

“How did those charlatans get away with it?” That is the question historians will be asking in generations to come. And: “Why, given his hearty endorsement from the start of all this green lunacy, was there ever a period when David Cameron was treated by significant segments of the media as an homme serieux?” And: “How can it possibly have been that, during the worst global recession since the 1930s, the world’s political leaders were able to impose such enormous, unjustified extra costs on their ailing economies without serious criticism from the commentariat or rebellion from their electorates?”

You’ll find at least one answer to the last question if you have a look at how these gas and electricity price rises are being spun. Consider this article, cited by Richard North, from “Scotland’s top-selling evening paper” the Evening Times. It’s titled “Energy Companies Are Mugging Customers”:

ScottishPower put up gas prices by almost 20% and electricity by 10% yesterday, adding hundreds of pounds to the average annual household energy bill from August this year, with other firms expected to follow suit.

John Robertson, Glasgow North West Labour MP, has called on Chancellor George Osborne to take action and to rethink his cut in the winter fuel allowance this year.

Mr Robertson, a member of the Energy and Climate Change Select Committee, said pensioners would be hardest hit as they will lose up to £100 this winter just as the increased bills start to be delivered.

He said most of those aged 60-79 will get £200 instead of last year’s £250 when the payment is made in November or December. Those who are 80 or older will get £300 instead of £400.

He said “People in Glasgow and the rest of Scotland are struggling to keep warm at winter, and the big energy companies are mugging the poorest people in our country.

“The big six energy companies are acting like a cartel and instead of price rises being the last alternative it seems to be the first. They seem to view consumers as cash cows and the Chancellor seems to view the poorest consumers with contempt.

“These companies are pinching money out of the pockets of the poorest people in this country at a time when ordinary household budgets are threadbare.”

Housing charity Shelter Scotland said the rise would put even more families into poverty.

Gordon MacRae, head of policy, said: “Prices cannot keep going up – something’s got to give. Either the short-term profit margins of utility companies or, for families, the choice of heating or eating. We fear that more families will not be able to pay their bills and eventually lose the fight to keep a roof over their head.”

The SNP also condemned the price rise. Energy spokesman Mike Weir MP said: “People just cannot keep absorbing continuous and colossal energy price increases like this, and the UK Government must step in.”

ScottishPower said the rise was necessary due to increasing cost of wholesale prices.

Raymond Jack, ScottishPower’s UK Retail director, said: “Wholesale prices for gas and electricity have increased significantly since the end of last year and continuing unrest in global energy markets means future prices are volatile.

“We understand times are difficult for many people, and we have done what we can to absorb these additional costs for as long as possible to minimise the impact on our customers.”

I’ve quoted the article in full just to show you how much of it is dedicated to explaining the hidden costs being imposed on the consumer as a result of eco-scaremongering. Not one single word. And the Evening Times is no exception. Here is a report from our own paper in which MPs are heard making much the same claims:

Michael Meacher, the Labour MP, said: “These are enormous increases. Energy companies claim they put up prices when wholesale prices go up. But then they are very sticky on prices when wholesale prices are coming down. They are profiteering at a time when everyone else is suffering austerity.”

Ed Miliband, the Labour leader, took to Twitter, to call for the Prime Minister to personally intervene.

He wrote: “David Cameron should urgently meet w Scottish Power to get prices down. PM needs to stop sitting idly by.”

and

Tim Yeo, Conservative MP and head of the Commons energy and climate change select committee, said: “If energy companies want to win back trust they should make clear what they have paid. Until we have that transparency, the public will remain suspicious that prices go up rather quickly and come down rather slowly.

“The amount by which they increase their prices should relate to what they have actually paid rather than to some theoretical calculation. We know that energy prices are rising, but what we will not accept is companies who appear to be exploiting their position.”

“Action is needed. It is best if it was voluntary, but if that does not happen then the government would be right to compel disclosure.

The technical term for all this, I believe, is “democratic deficit.” Here we have Tim Yeo MP – a Conservative MP, allegedly, and one with an influential position on Britain’s energy policy – joining up with various violently left-wing members of the Opposition to promulgate exactly the same almighty whopper: that the reason are energy prices are skyrocketing is down to a combination of insufficient regulation and corporate greed.

Let me just repeat that: here is an influential member of Britain’s Tory-led Coalition essentially arguing that what Britain needs right now is a less free market and more regulation. And also pretending that a policy for which he himself is partly responsible – the costly and pointless drive for renewables in the name of combatting climate change – DOESN’T EVEN EXIST.

How much longer are they going to get away with this? Well, I said at the beginning that this country was doomed, but I’m encouraged to see signs that just a hint of a fightback is beginning.

It’s nice, for example, to see my previously fairly agnostic colleague Charles Moore take up the baton for climate realism in this excellent Telegraph column. The Daily Mail, too, has been going MENTAL (but in a good way) on the subject all week, the latest entrant into the fray being the goose-downishly light-of-touch Richard Littlejohn.

Charles Moore is bang on the nail:

High energy costs kill economic growth. That is another way of saying that they make people poorer. Higher energy bills are implacable, direct, and impossible to avoid without personal discomfort. They are coming in now, whereas the counter benefits of any “Green Deal” are much more speculative and long-term. If people think that politicians are making them poorer for no good reason, they will not vote for them.

Say what you like about David Cameron – and you’ll have noticed I do, quite a bit – but if there’s one thing he’s good at it’s being more slippery than a jellied eel in a tub of KY Jelly. And he’ll need this skill in spades if he’s not to go down in history as the Prime Minister who, in the name of a non-existent problem, presided over the devastation of the British countryside with bat-chomping eco-crucifixes for rent-seeking toffs (aka wind farms) and the destruction of the British economy thanks to the imposition of wholly unnecessary costs and regulations. The best of luck to you Dave. And I don’t wish it you for your sake but the sake of our country. It deserves better than this, really it does.

The US Economy Visualized in 10 Horrifying Economic Charts

By Ken Cauley on March 18, 2011 · View Comments Comments · in Business

It is no mystery that the United States economy is struggling right now. We hear the consistent cries across virtually every medium of communication, online and offline, stating the same thing. While the causes and culprits are tirelessly up for debate by those with opposing viewpoints and beliefs, one thing we can hopefully all agree upon is that something is terribly wrong. Rest assured that you will not hear about Charlie Sheen giving his ‘winning’ approval on the US economic decisions over the past several decades. Make no mistake, if you think the US federal government is the only bad seed in this party, you’re as blind as they are. This growing fiasco has involved everybody that has ever made a financial decision; from federal and local governments to large and small businesses to the most powerful decision makers of all…everyday consumers.

The America Family Association has organized ten powerful economic graphs that put financial facts and figures into visual form. Sometimes you can quote economic statistics to people until you are blue in the face and it won’t do any good, but when those same people see charts and pictures suddenly it all sinks in. As you examine the economic charts below, pay special attention to what has been happening to the U.S. economy over the last 30 or 40 years. All of the economic problems that we are experiencing now have taken decades to develop. The sad fact of the matter is that we have been living in the biggest debt bubble in the history of the world over the last 40 years. All of this debt has purchased a wonderful standard of living for the vast majority of us, but all of this debt has also destroyed the economic future of our children and our grandchildren. Someday future generations will look back on what we have done in absolute horror.

With absolute sincerity to our great nation, my professional recommendation is to be prepared for the worst. Let’s of course go out kicking and screaming and not give up without a fight, but the writing is on the wall. Short of a miraculous recovery that takes, at the minimum, decades to complete (anything is possible), I would start thinking about how to best take care of you and your family for the remainder of your living years and beyond. It involves NOT relying on anybody else but yourself to make sound short and long-term financial decisions. It involves having a backup plan and a backup plan for your backup plan. And heck, if we as a nation get smart and make a true recovery (even if it takes 40 years), you’ll be one step ahead of the competition and able to pass down your financial wisdom and advice to younger generations.

Take a good look at these graphs and allow the information to sink in. Use common sense to determine how this has and will continue to impact your life and build a strategy on how you plan to get active in protecting yourself against the seemingly inevitable economic brink wall.

Federal spending is almost 18 times higher than it was back in 1970. Now Barack Obama has proposed a budget that would increase U.S. government spending to 5.6 trillion dollars in 2021. Just imagine what the following chart would look like if that happens....

he U.S. national debt is currently $14,081,561,324,681.83. It is more than 14 times larger than it was back in 1980. Unfortunately, the national debt continues to grow at breathtaking speed. In fact, the Obama administration is projecting that the federal budget deficit for this year will be an all-time record 1.6 trillion dollars.

The chart is from an official U.S. government report to Congress. As you can see, it is projected that interest on our exploding national debt is absolutely going to spiral out of control if we continue on the path that we are currently on....

The sad truth is that it is not just the U.S. government that has a massive debt problem. U.S. households have also been accumulating debt at a staggering rate. Total U.S. household debt did not pass the 2 trillion dollar mark until the mid-1980s, but now total U.S. household debt is well over 13 trillion dollars.

The total of all debt (government, business and consumer) in the United States is now well over 50 trillion dollars. For the past couple of years this figure has been hovering around a level that is equivalent to approximately 360 percent of GDP. This is a debt bubble that is absolutely unprecedented in U.S. history.

There are about 3 and a half times as many unemployed workers in the United States today as there were when 1970 began. These jobs losses are going to continue as long as we allow our corporations to pay slave labor wages to workers on the other side of the globe. All of the major trends in global trade are very bad for the U.S. middle class. For example, the U.S. trade deficit with China for 2010 was 27 times larger than it was back in 1990.

For most of the post-World War 2 era, when the median duration of unemployment in America reached 10 weeks that was considered a national crisis. Well, today competition for jobs is so intense that the median duration of unemployment is now well over 20 weeks

Since the Federal Reserve was created in 1913, the value of the U.S. dollar has declined by over 95 percent. One of the reasons given for the existence of the Federal Reserve is that the Fed helps control inflation. But that is a huge lie. The truth is that the United States never had consistently rampant inflation until the Federal Reserve took control. In particular, once the U.S. totally went off the gold standard in the 1970s inflation really started escalating out of control.

Now the Federal Reserve says that the solution to our current economic problems is to print even more money out of thin air. The games that the Federal Reserve is playing with our money supply are simply inexcusable. Just look at what the Federal Reserve has done to the monetary base since the beginning of the recession.

The price of oil is now ridiculously high. A high price for oil is very, very bad for the U.S. economy. Our entire economic system is based on being able to use massive quantities of very cheap oil. Unfortunately, that paradigm is starting to break down and the consequences will be very bitter. Back in mid-2008, the price of oil hit an all-time record of $147 a barrel and subsequently the world financial system imploded a few months later. Well, the price of oil is on the march again and that is very bad news for the U.S. economy.

Source: http://www.afa.net/Blogs/BlogPost.aspx?id=2147503555

Tagged with: america • americans • debt • dollar • economy • federal reserve • government • household debt • inflation • money • print money • unemployment

Do We Deserve Our Fate?

June 1, 2011

 

By Walter E. Williams

6/1/2011

The latest Social Security Trustees Report tells us that the program will be insolvent by the year 2037. The combined unfunded liability of Social Security and Medicare has reached nearly $107 trillion in today's dollars. That is about seven times the size of the U.S. economy and 10 times the size of the national debt. Those entitlement programs, along with others, account for nearly 60 percent of federal spending. They are what Congress calls non-discretionary spending. About half of discretionary spending is for national defense. Each year, non-discretionary spending consumes a higher and higher percentage of the federal budget.

The language Congress uses to describe their spending is corrupt beyond redemption. Think about the term entitlement. If one American is entitled to something he didn't earn, where in the world does Congress get the money? It's not Santa or the Tooth Fairy. The only way Congress can give one American a dollar is to first take it from another American. Therefore, an entitlement is a congressionally given right for one American to live at the expense of another. In other words, Congress forcibly uses one American to serve the purposes of another American. As such, it differs in degree, but not kind, from that uglier part of our history where black people were forcibly used to serve the purposes of their slave masters.

What about the terms discretionary versus non-discretionary congressional spending? Non-discretionary refers to uncontrollable things like sunsets and sunrises, low tides and high tides and laws of thermodynamics. By contrast, all congressional spending is discretionary and controllable. For political expedience, Congress has written laws to shield certain spending from annual budget scrutiny by calling it non-discretionary.

The level of congressional spending is unsustainable, but how willing are Americans to do anything about it? A courageous member of Congress, Paul Ryan, R-Wis., chairman of the House Budget Committee, has put forth a budget plan that would trim the deficit by $4.4 trillion over 10 years by reforming Medicare and Medicaid, making defense cuts and imposing hard spending caps on domestic spending.

Ryan's plan was immediately attacked as trying to balance the budget on the backs of the poor. In the wake of this attack, even some of his Republican backers, including House Speaker John Boehner, have become lukewarm in support.

The president and his supporters call for tax increases as a means to cover the deficit, but higher tax revenues cannot eliminate the deficit. Controlling for inflation, federal tax revenue today is 23 times greater than it was in 1960, but congressional spending is 42 times greater. During the last half-century, except for five years, the nation has faced a federal budget deficit. It's just simple math. If tax revenues soar, but congressional spending soars more, budget deficits cannot be avoided.

People ask what can be done to save our nation from decline. To ask that represents a misunderstanding of history and possibly a bit of arrogance. After all, how different are Americans from the Romans, Spaniards, French and the English? These were once mighty nations standing at the top of civilization. At the height of these nation's prosperity, no one would have predicted that they'd become third-rate nations, especially England. If during Queen Victoria's Jubilee in 1887 had a person suggested that England would become a third-rate nation and later challenged on the high seas by a sixth-rate nation (Argentina), he would have been declared insane.

One chief causal factor for the decline of these former great nations is what has been described as "bread and circuses," where government spends money for the shallow and immediate wants of the population, and civic virtue all but disappears. For the past half-century, our nation has been doing precisely what brought down other great nations. We might have now reached the point of no return. If so, do we deserve it?

Walter E. Williams

Dr. Williams serves on the faculty of George Mason University as John M. Olin Distinguished Professor of Economics and is the author of More Liberty Means Less Government: Our Founders Knew This Well.
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QE2: Debasement Of The Dollar An Abject Failure (Karl Denninger)

 

 

You got a 20% debasement (roughly) in the currency, a 20% increase in the stock market (net zero) but look at what went for a rocket ride.... just all the things you need to buy....

QE2 and Bernanke: FAIL

 

QE2: Debasement Of The Dollar An Abject Failure

Deconstructing the Left's Argument for Increasing Tax Rates on the Rich

Return to the Article

May 16, 2011

 

By Jim Stuart

In response to the deficit and to the debt crisis, the left repeatedly and forcefully argues for higher taxes on the "rich."  Aside from the fact that the entire income of the rich -- beyond what they already pay -- is insufficient to eliminate the deficit, conservatives argue that the top earners already pay a disproportionate share of federal income taxes.  In addition, conservatives argue that raising taxes on the rich, and particularly on small business owners, would suppress job creation, making the already serious unemployment problem worse at a time when we can least afford it.  The left responds that the rich should pay the lion's share of taxes because they earn the lion's share of income, arguing that since Reagan, almost all growth in income has gone to the rich.  The top 1% (the rich) earned 20% of all personal income in 2008 versus 8.51% in 1980 (See Figure 2 at the end).  Meanwhile, the bottom 50% of earners (the poor) earned 12.75% of the total income in 2008 versus 17.68% in 1980 (Figure 2).  Given that the income share for the rich went up while the income share for the poor went down, the left argues that it is unfair to pursue policies that will continue to disproportionately benefit the rich.

Let's examine the numbers a little more closely, looking at the tax share relative to income share for the two groups between 1980 and 2008.  The share of income tax paid by the rich in proportion to the share of their total income went from 2.25 to 1.9 between 1980 and 2008, while the same ratio for the poor went from .40 to .21 (Figure 2).  The effective tax burden (tax share in relation to income share) was 5.62 times higher for the rich than for the poor in 1980 and 9.0 times higher in 2008.  Thus, the relative tax burden on the rich -- relative to income -- compared to the poor nearly doubled from 1980 to 2008 -- from 5.62 to 9.0 (Figure 3).  Nevertheless, and despite the heavier and increasing tax burden on the rich, the fact that the income share for the rich increased while the income share for the poor decreased creates a seemingly irrefutable talking point for the left in the current budget debate.

 

Like many seemingly straightforward arguments, however, the claim that income growth has primarily benefited the rich does not in fact signify inequity, as it would appear.

 

The key is that the individuals paying taxes in the top 1% or bottom 50% in 1980 are not the same individuals as the taxpayers in the top or bottom segments thirty years later.  Over a period of many years, people move up and down the income ladder, depending on their ability, ambition, and experience and other factors.  The income categories more appropriately refer to classes of jobs or positions, not classes of people, and most individuals change jobs over their lifetime.  Arguably, it would be unfair for John, CEO, to have benefited from tax policy over the last thirty years, while Frank, dishwasher, did not.  It makes no sense, however, to argue that it is unfair to Frank that CEO salaries in general have gone up relatively more than dishwashers', particularly when John, 50, started out his career thirty years ago as a dishwasher and rose to become CEO through hard work, and Frank, 19, dishwasher, is in his first job and aspires to be CEO some day in the future.  It is not at all obvious that Frank is harmed rather than benefited by the fact that opportunities for him at the upper end of the income spectrum are improving over time, and if he is able to prepare himself, work hard, and advance, his prospects of earning an excellent living will get better as time goes by.

 

It is interesting to speculate about the reasons why higher-level positions have appreciated more than lower-level positions.  The compensation of nonunion workers, whether dishwashers, engineers, CEOs, or media celebrities, is determined by supply and demand in the free market.  The salaries of surgeons and engineers may be high because too few are willing to undergo the rigors of science and mathematics curricula and could perhaps be pushed downward by policies encouraging the education of more doctors and engineers, as well as policies facilitating entrepreneurship.  The salaries of dishwashers could perhaps be pushed upward by policies that reduce the competition from unskilled illegal aliens or reduce the number of high school dropouts and instead prepare them for better jobs.  Factors such as the increasing pervasiveness of computers may put added emphasis on knowledge and information-processing skills and concentrate more and more economic value in top positions and high-tech, fast-growing companies.  In any case, railing against the fact that economic compensation for unskilled positions isn't increasing faster than GDP makes no more sense than railing against the prices of food, energy, or raw materials, whose markets are increasingly global in scope and are largely unrelated to tax policy.

 

A ladder of opportunity will always exist that starts at the bottom with minimum wage jobs for new and unskilled workers and rises to the most competitive and demanding positions at the upper end of the scale.  How rich a person becomes depends on how far he or she is able to advance up the ladder and not on how much any particular position at any particular level at any particular moment in time is worth.

 

Whatever the explanation for pricing trends for high-paying versus low-paying work categories, the tax code should not be used in a misguided attempt to level after-tax income, when the result will be to discourage ambitious workers from preparing and competing for much-needed but demanding high-value positions.

 

A further reason for not increasing the relative federal income tax burden on the rich is that since the bottom half pay only 2.7% of the total federal income taxes and since nearly half of taxpayers pay no income federal income taxes at all, an incentive exists for a majority constituency to vote to accelerate the growth and spending of the federal government and to increase income taxes that they themselves do not pay.  Perhaps the solution would be "no representation without taxation."

 

Finally, as can be seen in Figure 1, showing adjustable gross incomes in 1980, 2007, and 2008, the income of the rich is much more volatile than that of the poor.  The income of the rich decreased by 16% between 2007 and 2008 as a result of the recession; compare that with less than 1% for the poor.  Overdependence of federal revenue on the rich thus exacerbates the problem for the federal government of falling tax revenue and resulting deficits during recessions.

 

In summary, there is a high and increasing progressivity in our tax code, which results in the rich currently paying nine times as much as the poor after taking income into account, and this progressivity has increased dramatically since 1980.  Both for maintaining individual economic independence and federal income stability, a broader tax base is desirable. Finally, when we look at how the benefits of growth are distributed from the perspective of individuals rather than income groupings, we realize that income is not static and that workers realize their hopes and dreams through preparation, advancement, and promotion or entrepreneurship, not through magically gaining higher wages for the same, static position.  What conservatives seek to offer are conditions of full employment in a dynamic, prosperous economy that permits new entrants in the labor market to readily find jobs at the start of their working lives and that at the same time, provides an abundance of higher-paying jobs that workers at all stages of their work life can aspire to.

 

Figure 1: Adjusted Gross Income between 1980 and 2008 ($ Billions)

Year	Adjusted Gross Income   Top 1%	Adjusted Gross Income   Bottom 50%
1980	138	288
2007	2008	1078
2008	1685	1075

Figure 2: Federal Income Tax Burden, 1980 and 2008

Year	Share of Tax %	Share of Income %	Tax Share/Income Share Ratio
1980	19.05	8.46	2.25
2008	38	20	1.9

Top 1%

1980	7.05	17.68	.4
2008	2.7	12.75	.212

Bottom 50%

 

                                                                       

Figure 3: Ratio of Tax Burden Top 1% to Bottom 50%, 1980 and 2008

Year	Tax Burden Ratio -- Top 1% Relative to Bottom 50%
1980	5.62
2008	9.0

              

All tax figures taken from the Tax Foundation at http://www.taxfoundation.org/news/show/250.html

Page Printed from: http://www.americanthinker.com/2011/05/deconstructing_the_lefts_argum.html at May 16, 2011 - 10:37:45 AM CDT

The Health Care Number You Didn't Hear

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February 26, 2010

 

By David Gratzer

On Thursday, the President gathered with Congressional members to discuss health reform. The President and Democratic leaders spoke of many numbers in their attempt to rebuild support for their proposals.

They mentioned 30 million (the number of uninsured Americans, according to the White House), 17 (the percentage of GDP spent on health care), and 1912 (the year when Teddy Roosevelt first called for universal coverage). But here's the number that no one mentioned: 12. And while all the other numbers are important, the key to reforming American health care rests with that one number, unmentioned.

American health care is expensive. If we spent what Switzerland does, we could cut income tax rates by 80%. And American health care is getting more expensive. Federal government figures indicate that health costs rose by 3.4% last year, roughly double the rate of inflation. It's not surprising, then, that the Obama White House has advocated "bending the curve" of health costs since Inauguration.

And, for the past year, the Administration has attempted to explain to Americans why health costs keep rising. The President spoke in July of Americans being offered two pills - "a red pill and a blue pill" - that are equally good, but one is half the price. Translation: drug companies are greedy. The President toured the Mayo Clinic, one of the best hospital complexes in the world and noted that Mayo physicians are on salary. Translation: your fee-for-service doc is greedy. The President used his September address to a joint session of Congress to bemoan the dearth of competition in the health insurance industry. Translation: insurance companies are greedy (and running a cartel).

If greed is the trouble, the White House seeks to address these woes with a raft of new regulations and rules. Obamacare will cut the profitability of pharmaceutical companies; it will create a committee to pay doctors for what the committee views as quality medicine; it will introduce a new Medicare-style public insurance to compete with private providers. Washington, in other words, will grow. The House version of the White House's proposal would create more than 100 new federal agencies and bodies.

But the problem with American health care isn't greed, its structural. After all, food and clothing are all organized with the profit motive - and the President isn't giving speeches that your butcher is too greedy or that Macy's is overly concerned with the bottom line.

The problem, ultimately, is 12.

A bit of background: American health care is an accidental system. Private coverage - the type most Americans have - has its origins in the wage controls of the Second World War as employers offered rich health-insurance benefits in pre-tax dollars. Public coverage like Medicaid and Medicare, on the other hand, takes its inspiration from the Beveridge report in Britain, drafted in the early 1940s; Lord William Beveridge believed in zero-dollar health care - that people ought to pay nothing at the point of use. Today's American health care fuses these two systems, but with a common economic flaw: people are overinsured, paying pennies directly on every dollar of health service they receive.

The end result: for every dollar spent on health care in the United States, just 12 cents comes out of the individuals' pockets. Imagine what food costs might be if your employer paid 88% of your grocery bill or what a trip to Saks might be like if your company covered the vast majority of the costs of the shopping spree.

Far from addressing the 12 cent problem, Obamacare would exacerbate it. With its rich subsidies, expansion of government programs, insistence that all insurance cover specific services (and some with no copayments at all), Obamacare would pour fuel on the fire of health inflation. It's one reason that even the chief actuary of the Centers for Medicare and Medicaid Services - a federal employee - predicts cost rises under the President's plan.

The White House has been sharp with its critics, demanding that they outline an alternative vision. Here's one: that Washington move decisions away from bureaucrats (be they corporate or government) and empower individuals and families. In other words, American health care should be more like the other five-sixths of the economy where consumers spend more of their own money - certainly much more than 12 cents on the dollar - and get more value for it.

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Dr. David Gratzer, a physician, is a senior fellow at the Manhattan Institute. He is the author of Why Obama’s Government Takeover of Health Care Will Be a Disaster (Encounter Books, 2009).

Page Printed from: http://www.realclearmarkets.com/articles/2010/02/26/the_health_care_number_you_didnt_hear_98362.html at May 13, 2011 - 07:30:01 AM CDT

Obamacare Explained By Maxine!

Obamacare Explained By Maxine!
4/19/11 | ?????

Posted on Tuesday, April 19, 2011 12:27:27 PM by Freepmanchew

Let me get this straight . . . .
We're going to be "gifted" with a health care
plan we are forced to purchase and
fined if we don't,
Which purportedly covers at least
thirty million more people,
without adding a single new doctor,
but provides for 16,000 new IRS agents,
written by a committee whose chairman
says he doesn't understand it,
passed by a Congress that didn't read it but
exempted themselves from it,
and signed by a President who smokes,
with funding administered by a treasury chief who
didn't pay his taxes,
for which we'll be taxed for four years before any
benefits take effect,
by a government which has
already bankrupted Social Security and Medicare,
all to be overseen by a surgeon general
who is obese,
and financed by a country that's broke!!!!!
'What could
possibly go wrong?'

The Incomparable Mark Steyn!

DOWNHILL ONLY ... Mark Steyn
Steyn Online ^ | 19 Apr 2011 | Mark Steyn

Posted on Tuesday, April 19, 2011 7:00:26 AM by Rummyfan

Wandering round this great republic predicting the apocalypse, I’m often asked by audience members why it is I’m being quite so overwrought if not an hysterical old queen about the whole business. After all, President Obama’s now-forgotten “Deficit Commission” produced a report melodramatically emblazoned “The Moment of Truth” and proposing such convulsive course corrections as raising the age of Social Security eligibility to 69.

By the year 2075.

With wake-up calls like that, we can all roll over and sleep in for another half century, right?

But some of us have been here before. We know the smell of decay, and we recognize it in America today. Last year, Niall Ferguson, professor at Oxford, at Harvard, and on highbrow telly documentaries, joined Barbra Streisand, James Brolin, and other eminent thinkers at the Aspen Ideas Festival. “Having grown up in a declining empire, I do not recommend it,” he told them. “It’s just not a lot of fun actually, decline.”

Amen, brother. It’s the small things you remember. The public clocks that stop and are never restarted. “Stands the church clock at ten to three? / And is there honey still for tea?” wrote Rupert Brooke, aching from abroad for an eternal England. If the town-hall clock stopped at ten to three, it stands there still, and the one above the splendid Victorian railway station stands at twelve past four, and the one on the Gothic Revival opera house at 7:23: You are literally in a land that time forgot. Likewise, the escalators. In “developing nations,” they’re a symbol of progress. In decaying nations, they’re an emblem of decline. In pre-Thatcher Britain, the escalators seized up, and stayed unrepaired for months on end. Eventually, someone would start them up again, only for them to break down 48 hours later and be out of service for another 18 months. It was always the up escalators. You were in a country that could only go downhill: All chutes, no ladders.

If you live in certain of our more obviously insolvent states, you may already recognize the phenomenon. A waggish reader wrote to me from the nation’s capital a few weeks ago hailing what he called Union Station’s cutting-edge bidirectional escalator technology. The conventional escalator on the left had been out of order for a month and “requires two full-time maintenance workers to stare at it for hours at a time while discussing football and women.” But during the same period the equally non-moving escalator on the right had been used every rush hour to accommodate thousands of both upward and downward commuters simultaneously. All the advanced technology of a staircase — now in an escalator! The bright new future of mass transit: no-speed escalators to high-speed trains.

Incremental decline is easy to get used to. I’m sure a few of my correspondent’s fellow commuters are equally droll about it and a few more get angry, but untold thousands more just shuffle uncomplainingly up and down, scuffing shoes and bumping backpacks. That’s the trick with decline: persuading people to accept it. The Transportation Security Administration, which in a decade of existence has never caught a single terrorist, has managed to persuade freeborn citizens to accept that minor state bureaucrats have the right to fondle your scrotum without probable cause. The TSA is now unionizing, which means that this hideous embodiment of bureaucratized sclerosis will now have its fingers in your gusset until the end of time.

What was it they used to say? If we give up our freedoms, the terrorists will have won! Whether or not the terrorists have won, the bureaucrats have. And they’re a more profound existential threat to America than the terrorists will ever be. My accountant was trying to explain to me the new 1099 requirements of Obamacare, but who cares? In the Republic of Paperwork, there’ll be a new set of new requirements along any minute. I’m ashamed of myself for even knowing what a 1099 is. But that’s the issue: Once you accept the principle that one citizen cannot contract with another without filing paperwork with the state, imposing ever more onerous conditions is merely a difference of degree.

In such a world it becomes more difficult to innovate, and frankly not a priority. When I deposit a New Zealand check at my bank in Montreal, the funds are available to me within two seconds. The last time I deposited a New Zealand check at my bank in the U.S., they sent it for “collection” (an entirely artificial concept in the computer age) to Australia, and by the time it came back it had expired. They couldn’t understand why I was annoyed — c’mon, man, we were in the ballpark! To resolve the issue, I had to go to the bank president, who, on being informed of my Canadian comparison, said, “Well, you must understand smaller countries by their nature have to get used to dealing with the rest of the world. It’s different for America.”

This might have been reasonable enough in 1950, when America was last man standing on a Western world otherwise reduced to rubble. But it seems an odd attitude for a country whose households are entirely filled by products made elsewhere and whose future is mortgaged to foreigners. And it made me wonder if perhaps Ferguson and I are being insufficiently apocalyptic. A gargantuan bureaucratized parochialism leavened by litigiousness and political correctness is a scale of decline no developed nation has yet attempted.

It doesn’t have to go like that. Abolish the 1099. Get the feds out of your underwear. Restart the escalator. But the clock is running down, fast.

from National Review

Political Thoughts For A Friday (Karl Denninger)

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Posted 2011-04-15 09:54
by Karl Denninger
in Politics

Political Thoughts For A Friday

Reflecting some more on the speech that Obama gave on the 13th, I'd like to focus in on a couple of specific sections:

We believe, in the words of our first Republican president, Abraham Lincoln, that through government, we should do together what we cannot do as well for ourselves.  And so we’ve built a strong military to keep us secure, and public schools and universities to educate our citizens.

The former is an enumerated power of the Federal Government in the Constitution.  The latter is not.  The latter, such as it exists, is in State Constitutions.

This is rather important, because there is no broad agreement on what the public's "burden" is for such a thing.  Bearing children is an individual choice.  Some people choose to have many, some few, some none. 

The common defense of the nation is a benefit that falls on all.  But the education of children is a duty occasioned by individual and consensual adult acts of intercourse.  The two are entirely-disjoint.

Thus the State (not Federal) focus on education.  This provides choice.  Those who believe that the proper allocation of cost should go to the person can choose a state to live in where that is respected.  Those who believe that the proper allocation of cost should be common can choose a state where that is required.  The Federal Government lacks the authority, as a matter of Constitutional Law, to force this issue.  (Not that The Federal Government has given a damn about Constitutional anything for the last hundred years or so.)

Part of this American belief that we are all connected also expresses itself in a conviction that each one of us deserves some basic measure of security.  We recognize that no matter how responsibly we live our lives, hard times or bad luck, a crippling illness or a layoff, may strike any one of us.  “There but for the grace of God go I,” we say to ourselves, and so we contribute to programs like Medicare and Social Security, which guarantee us health care and a measure of basic income after a lifetime of hard work; unemployment insurance, which protects us against unexpected job loss; and Medicaid, which provides care for millions of seniors in nursing homes, poor children, and those with disabilities.  We are a better country because of these commitments.  I’ll go further – we would not be a great country without those commitments.

Really?

I couldn't disagree more.

Let's make this personal, because in fact it is.  See, Obama would argue that there is this nebulous "whole" that covers such expense.  But he knows this is a lie, because there is nothing "paid in" and "retained" for either Social Security or Medicare.

So let's look at the facts and make it personal, Barack.

Do you, Barack Obama, have the right to demand that your daughters pay for your triple bypass when you are an old man should you be such a pig that you have not provided for such a possibility yourself via personally stashing either money or purchasing insurance against said risk?

I'll ask question personally as well:  Do I, having a daughter, have the right to force her to pay for my triple bypass (or two new hips) should I be so much of a pig that I have failed, for whatever reason, to put aside the necessary provisions to be able to pay for such myself in my old age?

We must make this question personal and turn the debate toward the personal form of this question because in each and every case it is.

This nebulous "society" argument is one that those on both the left and right continually use as a means of intentional deception and fraud upon the public.  There is no such thing.  All taxes are paid by people, and when it comes to social insurance costs, most of them are ladled upon those without the ability to vote.

When my daughter was a young child, barely in grade school, Medicare Part "D" was under debate.  I had a monstrous blow-up with my family over this very issue.  While she was blithely playing in their living room, my father proceeded to tell me that he believed he was entitled to that drug benefit.

This, despite the fact that the cost of such a benefit would fall most-directly on a young girl who had no right to protest or vote for or against it herself.

Medicare Part D, like all such social insurance programs, is an intentional fraud upon our children and grandchildren.  This is particularly true for medical "insurance" for the elderly, as our medical capacity has risen in both ability and cost at several times the direct inflation and thus "contribution" rate.  As a result of this fact all such arguments are in fact a claim that you have the right to hold up, at gunpoint, your children and grandchildren to pay for that which you are unable to personally whether as a result of your decision to spend those funds earlier in your life or through misfortune.

That's the essence of the debate about "social insurance" as it applies to the elderly.  It is not about a nebulous "societal" obligation, it is about your arrogation to yourself as you age of a right to literally steal, using the force of government, from your own children and grandchildren.

The argument is one for pigheadedness of epic proportion.  Through 5,000 years of recorded history intergenerational care has been provided as a matter of honor and choice by both the older and younger generations.  This bond was formed through the love of both groups for one another from the point of birth and largely constrained what could otherwise be unconscionable acts.  As parents we have the ability to be monsters, just as children do as well.  Historically the act of either party being a monster came with a sanction of not only being cast out, but the punishment later in life of being unable to access the love and care of your progeny and parents.  Both consequences were quite serious.

We have made a serious social mistake in our failure to deal with this problem honestly.  Steve Southerland and other so-called "Conservatives" have often bleated about how the degeneration of family lies at the root of many of the problems we have as a nation.  This may well be true, but the provision of these social programs, which provide a substitute that amounts to the forcible financial rape of one's progeny, means that parents no longer have an affirmative obligation to raise their children well and transition from an absolute power relationship at birth to one of mutual respect before adulthood, lest they die alone, hungry and wanting for care.

You want to know what has been largely responsible for the destruction of the American family?  The provision of a viable alternative, enforced at gunpoint against the next generation by government, for the support functions that family used to provide.

I declare as a matter of principle, morals, ethics and fact that I have no right to demand that my daughter provide one dime of funds of any sort for my care as I age, whether my failure to be able to do so myself is a consequence of my hubris, pigheadedness, profligacy and consumerism or simply bad luck.

Any such care, direct or indirect, that she chooses to provide is only mine to enjoy through a fully-free election of choice made by her, without the compulsion of government.

It is also my considered position that if you believe otherwise in any form, under any set of circumstances, you're an inhuman monster.

The President's Budget Address and the Reality of Taxing the 'Rich' (American Thinker)

 

By Steve McCann

The President is going to address the nation yet again.  He apparently intends to unveil another revised plan to fool the American people into believing he is sincere about reducing the deficit and reign in spending after the unserious budget he presented in February was soundly rejected by the country.  While his hand has been forced by the twin factors of the Republicans in the House (buoyed the effectiveness of the Tea Party movement) and the upcoming Presidential election, he will nonetheless bring up increasing taxes on the so-called wealthy and corporations as one of the primary means of solving the debt and deficit problem.

Unfortunately this approach plays well among the less enlightened and Obama's left-wing base who are in the thrall of class warfare and the capability of that argument to enflame passions and potential violence.  This argument is solely being utilized to keep the Democrats and their allies in power.  The reality is raising taxes and demonizing the wealthy will not solve but will instead exacerbate the current economic woes the country is experiencing.

There are stubborn things called facts that refuse to go away.  Normally the left and the media dismiss any argument coming from those on the conservative side of the spectrum as being unreliable and subject to right-wing bias.  One of the favored agencies of the liberals is the IRS (except when they are being audited), so let us focus entirely on the statistics they have published.

The wealth of Americans is an obsession with the left.  The last time the IRS published any statistics on that matter was in 2004, when the economy was doing far better than it is today.  At that time there were 2.7 million adults in the United States with a net worth (total value of all assets less debts and liabilities) in excess of $1.5 million for a total of $10.2 Trillion.  The IRS reference can be found here; Data Table: All top wealth holders by size of net worth.

If the government were to decide that no one should have a net worth above $1.5 million and would confiscate all wealth above that level, then there would be a one-time windfall of $6.1 Trillion to the Treasury.  As the total national debt is nearly $14.5 Trillion, this action would result in the reduction of the debt to $8.4Trillion.

However this tactic presents a major problem; how is the government going to realize the value of the seized assets?  For example within the net worth of the now confiscated assets are upwards of $2+ Trillion in real estate, but who is going to buy that at market value as no one will have the leverage or cash to do so?  Or who will buy the stocks, both publicly traded and closely held, where there are nearly $3 Trillion in present value, without collapsing the markets entirely?  The same is true of state and local bond issues or corporate bonds, US Treasury Bonds, mutual funds etc. etc.  The government, if it could at all, might realize a quarter of the value of the seized assets (if China were really interested) which had been previously used to underwrite the national economy.

The long term devastation to the economy would be unfathomable, as who would create jobs and wealth if they knew their assets would be seized above a certain point? 

If the left were to be convinced that this tactic would be counterproductive, then their argument turns to having the wealthy pay more income taxes every year as a major means of reducing the annual deficit and minimizing the amount of spending cuts necessary to balance the budget.

As a starting point lets us stipulate that the projected budget deficit for the current fiscal year is $1,665.0 Billion.  Per the Obama Budget it will be $1,100.0 Billion next year.  The IRS data for the following exercise is found as follows:  Section: Tax Generated; subsection, Tax and size of Adjusted Gross Income (2008): Table 3.5

The tax year of 2008 was the last to date that the IRS has done this kind of analysis.  In 2008 the highest marginal tax rate of 35% was applied to all AGI above $357,700.00.  In that year the total amount of AGI subject to the highest rate was $662.8 Billion.  The government collected in taxes $218.0 Billion (35%).

Assuming no change in behavior and a general eagerness to pay more, and if Obama and the left convince the Congress to raise taxes on the so-called rich, then the potential increase in revenue would be as follows.  If the highest rate of 35% were raised by a factor of 29% to 42%, the additional revenue would be $43.5 Billion, not much of a dent in the $1,665 Billion deficit.  If the rate was raised by a factor of 50% to 52.5%, the additional revenue would be $108.9 Billion.  Still nowhere near enough, so let's just tax it at a rate of 100% thus bringing in an additional $404.8 Billion.  Unfortunately the country is still $1,260.0 Billion in the hole for the year.

The top 1% of all income earners now pay nearly 40% of all income taxes collected by the Government.  There is a point at which the so-called rich would cease to have any incentive to earn above the highest tax threshold, particularly as the above exercise does not take into account state and local income taxes, Medicare, as well as a myriad of other "revenue enhancers."

From 1958 to 2008 the total tax revenue to the Federal Government has averaged between 16% and 20% of GDP.  (The highest level in history was in 1944 when it hit 20.9 %.) This despite the fact that the top marginal rate has varied between 90 and 35% over that period.  The historical lesson: there is simply no way the Government will change the way the people, particularly the wealthy, pay their taxes short of outright confiscation and permanent damage to the economy.

The left will argue that the wealthy should pay more even if it only makes a slight impact on the deficit.  Why, other than out of spite?  The only way to increase revenues to the Treasury, as has been proven by history, is to grow the economy, and to do that, the government cannot destroy the incentive of the producer class to do so.  That requires dramatically reducing spending, regulations and the size of government at all levels.

When Obama and the Democrats, in league with the Unions and the radical left, continue their mantra of the need to tax the rich and berating the so-called wealthy, it is not because their diatribes offer a viable solution to the country's fiscal woes or that they genuinely care about the citizenry, but because it serves their purpose to divide the people against each other and maintain their power base, as does their refusal to cut spending in order to buy votes.

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