Part Two - #s 6-7
6. Obamacare
Stanford economist Thomas Sowell summed it up in his usual cogent manner:
It is amazing that people who think we cannot afford to pay for doctors, hospitals, and medication somehow think that we can afford to pay for doctors, hospitals, medication and a government bureaucracy to administer it.
President Obama ignored the obvious and rammed his healthcare bill through Congress, disdaining the Republicans' offer to work with him. With the chutzpah with which we were to become familiar, Obama proclaimed:
Elections have consequences, and at the end of the day, I won. http://www.realclearpolitics.com/articles/2014/08/13/too_bad_obama_didnt_follow_his_own_advice_123650.html#ixzz4TOJItPKw
The bill was the Affordable Care Act, known popularly as Obamacare, a title he seemed to relish. The plan proved to be the folly Sowell indicated.
As to questioning the legislation, we were told that the bill had to be passed before we could tell what was in it. https://www.youtube.com/watch?v=gw3yoyIw3oM
Using all the pressure the White House could bring to bear upon reluctant Democrats, the bill was passed before legislators could assess what was in it. To their credit, Republicans did not vote for the bill so cavalierly imposed upon the country.
In securing its passage, Obama famously promised:
If you like your doctor, you can keep your doctor. If you like your health care plan, you can keep your health care plan.
Politifact judged this "The Lie of the Year."
In 2013, when insurers found the numbers did not work, 4 to 5 million people lost their health plans.
In an about-face we were to see again and again, Obama claimed he never said what he said.
In fact, it was said 37 times!
The numbers continue not to work, and more and more insurers are bailing.
Enrollment growth on the ACA exchanges has not come close to meeting projections. Apparently, middle-income people find the insurance offered too expensive even with the availability of subsidies and the penalty for not having insurance.
More and more, the mass media avoid calling it "Obamacare' and have reverted to the Affordable Care Act. A rose by any other name? Obamacare or the ACA, a mess is still a mess.
Ramirez does his usual brilliant job - a picture worth a thousand words:
The Trump administration is committed to repealing the ACA. [endif]Many plans have been proposed to replace it.
All incorporate Republican free market principles.
Some suggest any repeal and replacement must take place over 2 years. I can see that bogging down in a confusion of resolutions and amendments, a fertile field for democrat obstruction which we know is coming.
Why not a full repeal immediately while the GOP has the votes, assuming the RINOs cooperate? Then deal with the fall out problems on a case by case basis.
In the meantime, implement basic, long advocated reforms which may fix or mitigate some of the problems..
- Remove the ban on insurance companies competing across state lines. Will spur competition for coverage and rates.
- Dollar for dollar deduction for health care insurance . Young people, who now go without insurance in the mistaken belief that they will not need it until they are older, would have an incentive to obtain it. Reduces impact on 'free' Emergency Room care.
- Dollar for dollar deduction for medical expenses including non-prescription remedies. Provides Incentive for people to take care of themselves.
7. Federal Bureaucracy -The Augean Stable
In Greek mythology, Heracles, a/k/a Hercules, was charged to perform twelve labors for atonement, one of which was to clean out the stable of King Augeas. The stables were home to 1000 cattle and had not been cleaned for 30 years. The labor was designed not only to defeat Heracles but to humiliate him.
Heracles dug trenches to divert the waters of two rivers so that they flowed through the stables, washing out all the filth. He then redirected the rivers to their normal paths but retained a bubbling brook near the stables for the comfort of the animals.
Today, the phrase "clean the Augean stable," means "clear away corruption" or "perform a large and unpleasant task that has long called for attention." https://www.merriam-webster.com/
That sums up the task for the Trump administration with the federal bureaucracy. Sounds a lot like "Drain the Swamp."
For the most part, the private sector does things better than governmental agencies.
That is a judgment based on my experience. In more than 6 decades of employment, I have worked the public sector at both the state and federal level, and the private sector from large corporations to small companies, and I have established and managed my own business.
There are those who embrace the concept that government can provide services better and be a fair competitor with the private sector. That of course is a horrible misconception.
First, government does not have to raise capital, it simply raises taxes – or it can print money to fund its programs. Government does not have to pay for advertising its “product,” it uses unlimited taxpayer funds. Government does not have to produce a superior product, it can use the legislative process to “mandate” – we call it coerce – behavior, forcing acceptance.
http://www.ncpa.org/commentaries/government-and-the-private-sector-a-case-study#sthash.YUM2nkjr.dpuf
There are some significant exceptions: the military, the police, and other law enforcement agencies. Yet even those agencies have bureaucrats diverting from the assigned task.
...within the DoD [Department of Defense]...the bloated bureaucracy. The growth in civilian and staff numbers continues to exceed what is necessary, while the number of general and flag officers positions has increased disproportionately to the personnel they oversee: Roughly 2,000 GFOs oversaw 12 million military personnel in 1945. Now, nearly 900 GFOs oversee 1.3 million active duty personnel. In fact, over the past 30 years, the military’s end-strength deployable/fieldable forces has decreased 38 percent, but the ratio of four-star officers to the overall force has increased by 65 percent. A 10 percent cut among general and flag officers and their staffs alone could save nearly $11.5 billion over 5 years.
Government employees produce nothing. Yet, average federal wages far outstrip those in the private economy. When benefits are included, federal worker compensation averages $123,000 — more than double the private-sector average of $61,000.
That is so because the scales are tilted in favor of public sector unions. With private sector unions, there is genuine bargaining with management because the persons on both sides of the table have skin in the game. Management needs to make profit and has an incentive not to give into every demand. Correspondingly, the private sector unions have an incentive to get a deal done that keeps the company viable and their jobs alive. Bargaining to a deal is real.
Not so with public sector unions. Government representatives are on the other side of the table. They have no skin in the game. It is not their money. They have no motivation to make a profit. In fact, it is often to their advantage to give the public sector unions whatever they demand because they can expect contributions from the union for their political party and their personal political futures. The irony is that it was never contemplated that collective bargaining should be used for the public sector http://www.nytimes.com/roomfordebate/2011/02/18/the-first-blow-against-public-employees/fdr-warned-us-about-public-sector-unions
Abuses abound. In 2014, the GAO reported thousands of federal workers who have been put on administrative leave often for misconduct have been allowed to collect a paycheck, and accrue vacation days and pension benefits, at taxpayer expense. ...53,000 civilian employees were kept home for one to three months. Another 4,000 were kept off the job for three months to a year and hundreds more for one to three years. The number eclipses the number at private companies. Private companies will rarely pay employees while investigating claims and in the cases where they do, the leave lasts for only a few days.
Waste is endemic to the federal government. In the private sector, one who does the job for less than the budgeted amount, is rewarded. In the government, incentives run the other way. Years ago, I witnessed first hand people in the Department of Justice, 6 weeks before the end of the fiscal year, frantically looking for projects to fund lest they go before Congress with surplus money. How could they then ask for more? Advancement depended on growing one's agency.
Researchers found that federal procurement spending was five times higher in the last week of the fiscal year than the weekly average for the rest of the year, and the quality of the projects was scored well below average.
http://www.ncpa.org/pdfs/ib190.pdf
https://sites.hks.harvard.edu/jeffreyliebman/LiebmanMahoneyExpiringBudgets.pdf
Bureaucracies metastasize. The federal bureaucracies burden the economy in two ways: taxes exacted to fund their ever increasing payrolls and expansive and expensive regulations curbing private enterprise. The risk that regulators pose to business is up 79% from 2010—a burden that falls heavy on industry. http://www.wsj.com/articles/the-rust-belt-is-right-to-blame-obama-1482098189
Prior posts have detailed those abuses in two agencies: The Department of Education, [Archive Issue 18] and the Environmental Protection Agency [Archive Issue 21] both of which, while spending billions, failed to accomplish the intended goals.
The DoE should be cut 25% each year with a goal of terminating it in four years. A 2010 Cato Institute Study demonstrated that a shut down would save $107 billion annually. http://www.downsizinggovernment.org/education/spending-cuts
The EPA's budget for 2016 was more than $8 billion and it had 15,000 employees. In its first seven years its budgets averaged a little over 1 billion dollars with 6000 employees.The EPA should be cut back to those levels while it is returned to the common sense of its original purpose. https://www.epa.gov/planandbudget/
These agencies were worse than ineffectual; they were harmful. Unfortunately, they are the rule.
Similar cuts need to be made in all the agencies. A wealth of information on waste can be found here. http://www.cagw.org/
There are remedies - Inspectors General. There are 73 federal offices of inspectors general...The offices employ special agents ... forensic auditors, or "audigators," evaluators, inspectors, administrative investigators, and a variety of other specialists. Their activities include the detection and prevention of fraud, waste, abuse, and mismanagement of the government programs and operations within their parent organizations.
When it was reported in Oct. 2006 that Department of Interior employees wasted $2,027,887.68 worth of taxpayer time annually surfing sexually explicit, gambling, and auction websites while at work, it was the Interior Department's own Office of Inspector General that conducted the investigation and issued the report. http://usgovinfo.about.com/od/thepresidentandcabinet/a/oig.htm
Remember Obama' s promise to make government transparent. In 2014, 47 Inspectors General signed an open letter complaining the Obama administration was stonewalling their investigations....with 'serious limitations on access to records that have recently impeded the work'...
Zero-based budgeting is a system proven to decrease expenditures and improve efficiency within private sector companies and public institutions. This budget method identifies wasteful spending and helps purge unnecessary expenses by obligating each department to justify its proposed spending each and every year. This method automatically eliminates the practice of carrying over the budget from the previous year. …has saved large corporations 10 percent to 25 percent, according to independent studies. And those savings are more sustainable over a longer period …The annual requirement to defend each and every expenditure as necessary and worthwhile would cause an agency like the EPA to collapse under the weight of its own uselessness.
“Midnight” regulations refer to new administrative rules enacted after Election Day. Obama's agencies are working to enact as many new regulations as possible before Trump takes over. .... The American Actions Forum estimates that the Obama regulations in total will cost the country about $44 billion. So much for Obama’s promise of cooperation for a “smooth transition” – that goes the way of “shovel ready jobs” and “you can keep your plan, your doctor.”
The Congressional Review Act, passed in 1996, gives a new Congress the authority to undo “midnight” regulations by a simple majority vote in both chambers. Congress can undo any particular rule within 60 days of it being written. It will not be easy as the law calls for consideration of only one rule at a time. Equal time must be considered in both the House and Senate chambers. There is a solution. The House passed the Midnight Rules Relief Act. which will allow multiple regulations to be considered together. If it becomes law in time, the Act would greatly expedite the process of undoing Obama’s burdensome regulations.
In 2009, the Senate confirmed seven of Obama's Cabinet nominees. By the end of that week, it had cleared more than a dozen senior-level nominees. Does anyone believe there will be reciprocity for Trump's choices? [Archive 22 #2]
The link below contains a marvelous rant provoked by classic chutzpah - Federal employees petitioning for another day off with pay, citing the hardships they suffer. This might provide a needed chuckle.
Extreme taxation, excessive controls, oppressive government competition with business, frustrated minorities and forgotten Americans are not the products of free enterprise. They are the residue of centralized bureaucracy, of government by a self-anointed elite...
Bureaucracy is adept at protecting its nest...
Unless bureaucracy is constantly resisted, it breaks down representative government and overwhelms democracy...
Ronald Reagan