Progressives: Soft Hearts, Soft Heads.

[PoliticalChic]

In his book, "Applied Economics," Dr. Thomas Sowell refers to the ability to analyze not only the short term (Stage One) political impact, but to also think ahead to their long term (Stage Two, Three, etc) economic impact. See, there is the problem with our progressive friends...economics and Stage Two thinking.

1. For example, FDR, August 14, 1935, on signing the Social Security Act: “We can never insure 100 percent of the population against 100 percent of the hazards and vicissitudes of life, but we have tried to frame a law which will give some measure of protection to the average citizen and to his family against the loss of a job and against poverty-ridden old age,…”

2. See, soft heart: who could argue with the intent? But where is the fiscal know-how?

a. No one considered that life expectancy would increase?
b. No one considered that the balance of workers and retirees might change?
c. No one calculated the long-term costs?

d. Ida May Fuller, the first person to begin receiving benefits, in January, 1940, when she was 65- she lived to be 100. “…worked for three years under the Social Security program. The accumulated taxes on her salary during those three years was a total of $24.75. Her initial monthly check was $22.54. During her lifetime she collected a total of $22,888.92 in Social Security benefits.” Social Security Online

e. “Social Security will pay out more this year than it gets in payroll taxes, marking the first time since the program will be in the red since it was overhauled in 1983, according to the annual authoritative report released Thursday by the program's actuary.” Social Security in the red this year - Washington Times

f. “…redeeming trust fund assets until reserves are exhausted in 2037, at which point tax income would be sufficient to pay about 75 percent of scheduled benefits through 2084.” Trustees Report Summary

3. Of course, Republicans passed Medicare Part D, but, credit where credit is due, progressives, unchecked, leave those budget time bombs: the New Deal gave us Social Security, Obama gave us Obamacare, and the Great Society left us Medicare. Beck, Balfe, “Broke, “ p. 207

a. Prior to passage, estimates for Medicare were about $1.1 billion for the following two years, and “several billion over this decade.” And this, just after passage, “The first full-year cost was estimated as $6.5 billion.” Medicare, 1965 Legislative Chronology | Journihilism and “The House Ways and Means Committee estimated that Medicare would cost only about $ 12 billion by 1990 (a figure that included an allowance for inflation).” The Medicare Monster - Reason Magazine

b. “But in 1990 Medicare actually cost $107 billion.” Ibid.
c. Current annual budget for Medicare: $498 billion. Obama?s 2011 Budget Proposal: How It?s Spent - Interactive Graphic - NYTimes.com


4. . ‘As background to its estimates, the CBO notes that spending on Medicare, Medicaid, and Social Security will rise rapidly in the future, pushing up "primary" federal spending (excluding interest payments on the debt) from 18.2 percent of GDP today to 28.3 percent in 2050 and 35.3 percent in 2082. With interest payments included, spending will hit 41.8 percent of GDP in 2050 and 75.4 per¬cent by 2082…."[t]he tax rate for the lowest bracket would have to be increased from 10 per¬cent to 25 percent; the tax rate on incomes in the current 25 percent bracket would have to be increased to 63 percent; and the tax rate of the highest bracket would have to be raised from 35 percent to 88 percent. The top corporate income tax rate would also increase from 35 percent to 88 percent." Peter R. Orszag, Director, Congressional Budget Office, letter to Representative Paul Ryan (R–WI), May 19, 2008,
Taxes to Pay for Medicare, Medicaid, and SSI | Medicare Insurance | eons.com

5. “Spending on the three major entitlements, Medicare, Medicaid, and Social Security, will more than double in the next 40 years. Without major reforms, entitlement spending will consume all federal tax revenues by 2052.” http://www.issues2010.com/pdf/Entitlements.pdf

Did you get that? Every penny of taxes for these three entitlements...we won't even be able to pay for the interest on the debt!!!!

Thanks, progressives.

 

[daveman]

"Uhhh...tax the rich!!" /progressive mode

 

[william the wie]

There is a simple and humane solution but it won't be used:

Index social security and medicare eligibility to life expectancy.

Create a DARPA style prize regime to increase health and life expectancy.

 

[PoliticalChic]

There is a simple and humane solution but it won't be used:

Index social security and medicare eligibility to life expectancy.

Create a DARPA style prize regime to increase health and life expectancy.

I like it, Willie..

How about we give extra consideration to folks who continue to work,

“Of 31 million people 55-64, 61.9% are in the work force.
Of 18 million people 65-74, 23% are in the work force.”

Compare to France, where only 50% work past fifty. How many people in the United States are over 50 years old in the workplace? I think this article has a typo: http://tr.im/kswp

So, at an advanced age, we make 'em eligible at younger age than those who have voluntarily stopped working.

And...also give that bonus to entrepeneurs, as opposed to those working for someone?
(Think the libs will come for me with torches and pitchforks when they read that one?)

 

[loosecannon]

There is a simple and humane solution but it won't be used:

Index social security and medicare eligibility to life expectancy.

Create a DARPA style prize regime to increase health and life expectancy.

The problems are two:

First SS is an extremely significant tax born largely by the middle and lower classes and stolen by the federal government to finance dreams programs.

FICA costs each wage earner 14.08% of their entire lifetime salary. That is HUGE! So you can't renig, and you can't raise the age of qualification so high that less than half ever live to collect bennies, because riots and revolution, even mass murder of elected officials would be justified if you did. Fully justified.

The reality is that for 30 years we have endured a TAX that is fully bogus and our money has been stolen, now the younger generations want to deny benefits incrementally and I can't really blame them.

But there can be no justice unless we burn 10,000 or so former and present politicos at the stake.

Because the money they stole is gone, the tax was real and onerous and the benefits are guaranteed by contract.

If SS isn't honored blood must flow in the streets.

 

[loosecannon]

I forgot to add that indexing to life expectancy makes SS a tax on those who die young to serve those who live too long.

Why don't we impose a maximum life span, or a maximum eligibility age instead and share benefits more equally?

You live to be 65 you get benefits, if you live to be 75 they expire.

I might add that the problem is kind of caused by the solution. One of the primary reasons why people live long past their productive years is because we pay them to retire.

In the real world if you stop working you die, or your spawn support you. What's wrong with the plan approved by Gawd and Nature's Gawd?

 

[PoliticalChic]

I forgot to add that indexing to life expectancy makes SS a tax on those who die young to serve those who live too long.

Why don't we impose a maximum life span, or a maximum benefits term instead and share benefits more equally?

You live to be 65 you get benefits, if you live to be 75 they expire.

This is starting to sound like soylent green...

yechhhhhh.

 

[finebead]

Well, let's take medicare. Does anyone else have any idea how to meet the health care needs of the population after they retire, given that the govt. in the US chose after WWII that healthcare would come from your employer, when most other major industrialized countries chose to provide healthcare via a govt. run single payer system.

You can talk about the weaknesses of the British or Canadian system, but they cover everyone for 10% of GDP vs. 17% of GDP in the US, while we leave out 18% of the population.

So, if we scrap medicare, how else would you provide healthcare to the over 65 population? Would everyone have to work until they die? If they worked and stayed employed, insurance companies would drastically raise rates to cover their higher healthcare expenses. I doubt many people could afford a private plan, and since most would have pre-existing conditions, the insurance companies would not want them on the rolls.

So, if we scrap medicare, what is your other plan? Do you plan to go on medicare at 65? Why?

 

[loosecannon]

I forgot to add that indexing to life expectancy makes SS a tax on those who die young to serve those who live too long.

Why don't we impose a maximum life span, or a maximum benefits term instead and share benefits more equally?

You live to be 65 you get benefits, if you live to be 75 they expire.

This is starting to sound like soylent green...

yechhhhhh.

I have like 50 species of wild vertebrates in my yard on any given day. There is not one species who isn't eating, or being eaten by the other species.

Retirement is an unsustainable platitude that the nanny state seeks to finance by taxing those who die young.

And we have far too many people on earth and more and more being born as we speak.

50,000 or more people have been dying of malnutrition every day in the underdeveloped world for 4 decades. By 2050 it is gonna get very, very ugly even in the developed nations.

Welcome to reality.

 

[PoliticalChic]

Well, let's take medicare. Does anyone else have any idea how to meet the health care needs of the population after they retire, given that the govt. in the US chose after WWII that healthcare would come from your employer, when most other major industrialized countries chose to provide healthcare via a govt. run single payer system.

You can talk about the weaknesses of the British or Canadian system, but they cover everyone for 10% of GDP vs. 17% of GDP in the US, while we leave out 18% of the population.

So, if we scrap medicare, how else would you provide healthcare to the over 65 population? Would everyone have to work until they die? If they worked and stayed employed, insurance companies would drastically raise rates to cover their higher healthcare expenses. I doubt many people could afford a private plan, and since most would have pre-existing conditions, the insurance companies would not want them on the rolls.

So, if we scrap medicare, what is your other plan? Do you plan to go on medicare at 65? Why?

The point of the OP is that we cannot afford to contiue on the current path....

I'd try the following:

1. Tort Reform:
While malpractice litigation accounts for only about 0.6 percent of U.S. health care costs, the fear of being sued causes U.S. doctors to order more tests than their Canadian counterparts. So-called defensive medicine increases health care costs by up to 9 percent, Medicare's administrator told Congress in 2005. "
Canada keeps malpractice cost in check - St. Petersburg Times

Now, compare those with these:
"Also, it’s worth noting that while these figures sound like a lot of money — and few would dispute the fact that health insurance company CEOs make healthy salaries — these numbers represent a very small fraction of total health care spending in the U.S. In 2007, national health care expenditures totaled $2.2 trillion. Health insurance profits of nearly $13 billion make up 0.6 percent of that. CEO compensation is a mere 0.005 percent of total spending."
FactCheck.org: Pushing for a Public Plan

The conclusion is that the cost of malpractice suits is equal to the profit of the entire industry.

This may be significant of and by itself, but when we look at the costs of defensive medicine, it alone adds to the costs of healthcare by a factor 15!!!
Once providers don’t have to watch over their shoulders for the lawyers, we should move toward coordinated care networks that take responsibility for their members' medical needs in return for fixed annual payments (called "capitation"). One approach is through vouchers; Medicare recipients would receive a fixed amount and shop for networks with the lowest cost and highest quality.


2. Reform of Insurance Policy Mandates:

Scrap all city, state, federal mandates for healthcare insurance policies. When a statute says policies must “cover mammograms of everyone 35 and over,’ how is this fair for a construction company with all male employees? What about ‘Podiatry,’ or ‘sexual reorientation surgery/? Allow insurance companies to write policies covering exactly what the consumer asks for:
Take two very different states: Wisconsin and New York. In Wisconsin, a family can buy a health-insurance plan for as little as $3,000 a year. The price for a basic family plan in the Empire State: $12,000. The stark difference has nothing to do with each state’s health sector as a share of its economy (14.8 percent in Wisconsin as of 2004, the most recent year for which data are available, and 13.9 percent in New York). Rather, the difference has to do with how each state’s insurance pools are regulated. In New York State, politicians have tried to run the health-insurance system from Albany, forcing insurers to deliver complex Cadillac plans to every subscriber for political reasons, driving up costs. Wisconsin’s insurers are far freer to sell plans at prices consumers want.
The gulf in insurance-premium prices among American states is a sign that too much government intervention—not too little—is what’s distorting prices from one market to the next. The key to reducing health-care costs for patients, then, is to promote competition, not to dictate insurance requirements from on high. Unfortunately, a government-run insurance plan is the core of ObamaCare.
Bigger Is Healthier by David Gratzer, City Journal 22 July 2009
a. NJ has some 68-69 mandates including in vitro fertilization, which adds some 2-2.5% to the cost of the policy

3.. Doctors currently have no ability to re-price or re-package their services that way every other professional does. Medicare dictates what it pays for and what it won’t pay for, and the final price. Because of this there are no telephone consultations paid for, and the same for e-mails, normal in every other profession.
Most doctors don’t digitize records, thus they cannot use software that allows electronic prescription, and make it easier to detect drug interactions or dosage mistakes. Again, Medicare doesn’t pay for it.

4. Another free market idea aimed at better quality is have warranties for surgery as we do for cars. 17% of Medicare patients who enter a hospital re-enter within 30 days because of a problem connected to the original surgery. The result is that a hospital makes money on its mistakes!

5. Walk-in clinics are growing around the country, where a registered nurse sits at a computer, the patient describes symptoms, the nurse types it in and follows a computerized protocol, the nurse can prescribe electronically, and the patient sees the price in advance

6. To reduce healthcare costs, increase the number of doctors. Both tax incentives and support of the tuition of medical school.

7. Identify the 8-10 million who need and are unable to get healthcare, including those with pre-existing conditions,and provide debit cards as is done for food stamps:

"Food debit cards help 27 million people buy food, similar to the number who need help buying health coverage. In all fifty states, debit card technology has transformed the federal food stamp program, which used to be notorious for fraud and abuse. (Only 2 percent of card users are found to be ineligible, according to the General Accounting Office.) Cards are loaded with a specific dollar amount monthly, depending on family size and income, and allow cardholders to shop anywhere. The same strategy could be adapted to provide purchasing power to families who need help buying high-deductible health coverage. It's what all Americans used to buy (see chart 5), and it's all that's needed for families with moderate incomes, who can afford a routine doctor visit. "
Downgrading Health Care

8. Current law provides unlimited tax relief for coverage obtained through an employer but no comparable relief for those who purchase coverage outside their places of work. Replace the current tax preference for employer-based health coverage with a new individual-based system. The bill would end the tax exclusion in the personal income tax for employer-based health insurance benefits and instead use a combination of subsidies and tax deductions for health insurance. Ideally, the current employer-based tax structure should be replaced with a fair and equitable universal tax credit. An across-the-board, fixed-dollar health care tax credit, for example, would offer every American federal tax relief for health care.

That's where I'd start.

 

[Oddball]

Progressives: Soft Hearts, Soft Heads.

They have real soft hearts for the visible beneficiaries of their benevolent patronage, but nothing the hardest of hearts for the invisible casualties and those who are being openly shaken down to pay for their "compassion".

 

[loosecannon]

Well, let's take medicare. Does anyone else have any idea how to meet the health care needs of the population after they retire, given that the govt. in the US chose after WWII that healthcare would come from your employer, when most other major industrialized countries chose to provide healthcare via a govt. run single payer system.

You can talk about the weaknesses of the British or Canadian system, but they cover everyone for 10% of GDP vs. 17% of GDP in the US, while we leave out 18% of the population.

So, if we scrap medicare, how else would you provide healthcare to the over 65 population? Would everyone have to work until they die? If they worked and stayed employed, insurance companies would drastically raise rates to cover their higher healthcare expenses. I doubt many people could afford a private plan, and since most would have pre-existing conditions, the insurance companies would not want them on the rolls.

So, if we scrap medicare, what is your other plan? Do you plan to go on medicare at 65? Why?

The point of the OP is that we cannot afford to contiue on the current path....

I'd try the following:

1. Tort Reform:
While malpractice litigation accounts for only about 0.6 percent of U.S. health care costs, the fear of being sued causes U.S. doctors to order more tests than their Canadian counterparts. So-called defensive medicine increases health care costs by up to 9 percent, Medicare's administrator told Congress in 2005. "
Canada keeps malpractice cost in check - St. Petersburg Times

Now, compare those with these:
"Also, it’s worth noting that while these figures sound like a lot of money — and few would dispute the fact that health insurance company CEOs make healthy salaries — these numbers represent a very small fraction of total health care spending in the U.S. In 2007, national health care expenditures totaled $2.2 trillion. Health insurance profits of nearly $13 billion make up 0.6 percent of that. CEO compensation is a mere 0.005 percent of total spending."
FactCheck.org: Pushing for a Public Plan

The conclusion is that the cost of malpractice suits is equal to the profit of the entire industry.

This may be significant of and by itself, but when we look at the costs of defensive medicine, it alone adds to the costs of healthcare by a factor 15!!!
Once providers don’t have to watch over their shoulders for the lawyers, we should move toward coordinated care networks that take responsibility for their members' medical needs in return for fixed annual payments (called "capitation"). One approach is through vouchers; Medicare recipients would receive a fixed amount and shop for networks with the lowest cost and highest quality.


2. Reform of Insurance Policy Mandates:

Scrap all city, state, federal mandates for healthcare insurance policies. When a statute says policies must “cover mammograms of everyone 35 and over,’ how is this fair for a construction company with all male employees? What about ‘Podiatry,’ or ‘sexual reorientation surgery/? Allow insurance companies to write policies covering exactly what the consumer asks for:
Take two very different states: Wisconsin and New York. In Wisconsin, a family can buy a health-insurance plan for as little as $3,000 a year. The price for a basic family plan in the Empire State: $12,000. The stark difference has nothing to do with each state’s health sector as a share of its economy (14.8 percent in Wisconsin as of 2004, the most recent year for which data are available, and 13.9 percent in New York). Rather, the difference has to do with how each state’s insurance pools are regulated. In New York State, politicians have tried to run the health-insurance system from Albany, forcing insurers to deliver complex Cadillac plans to every subscriber for political reasons, driving up costs. Wisconsin’s insurers are far freer to sell plans at prices consumers want.
The gulf in insurance-premium prices among American states is a sign that too much government intervention—not too little—is what’s distorting prices from one market to the next. The key to reducing health-care costs for patients, then, is to promote competition, not to dictate insurance requirements from on high. Unfortunately, a government-run insurance plan is the core of ObamaCare.
Bigger Is Healthier by David Gratzer, City Journal 22 July 2009
a. NJ has some 68-69 mandates including in vitro fertilization, which adds some 2-2.5% to the cost of the policy

3.. Doctors currently have no ability to re-price or re-package their services that way every other professional does. Medicare dictates what it pays for and what it won’t pay for, and the final price. Because of this there are no telephone consultations paid for, and the same for e-mails, normal in every other profession.
Most doctors don’t digitize records, thus they cannot use software that allows electronic prescription, and make it easier to detect drug interactions or dosage mistakes. Again, Medicare doesn’t pay for it.

4. Another free market idea aimed at better quality is have warranties for surgery as we do for cars. 17% of Medicare patients who enter a hospital re-enter within 30 days because of a problem connected to the original surgery. The result is that a hospital makes money on its mistakes!

5. Walk-in clinics are growing around the country, where a registered nurse sits at a computer, the patient describes symptoms, the nurse types it in and follows a computerized protocol, the nurse can prescribe electronically, and the patient sees the price in advance

6. To reduce healthcare costs, increase the number of doctors. Both tax incentives and support of the tuition of medical school.

7. Identify the 8-10 million who need and are unable to get healthcare, including those with pre-existing conditions,and provide debit cards as is done for food stamps:

"Food debit cards help 27 million people buy food, similar to the number who need help buying health coverage. In all fifty states, debit card technology has transformed the federal food stamp program, which used to be notorious for fraud and abuse. (Only 2 percent of card users are found to be ineligible, according to the General Accounting Office.) Cards are loaded with a specific dollar amount monthly, depending on family size and income, and allow cardholders to shop anywhere. The same strategy could be adapted to provide purchasing power to families who need help buying high-deductible health coverage. It's what all Americans used to buy (see chart 5), and it's all that's needed for families with moderate incomes, who can afford a routine doctor visit. "
Downgrading Health Care

8. Current law provides unlimited tax relief for coverage obtained through an employer but no comparable relief for those who purchase coverage outside their places of work. Replace the current tax preference for employer-based health coverage with a new individual-based system. The bill would end the tax exclusion in the personal income tax for employer-based health insurance benefits and instead use a combination of subsidies and tax deductions for health insurance. Ideally, the current employer-based tax structure should be replaced with a fair and equitable universal tax credit. An across-the-board, fixed-dollar health care tax credit, for example, would offer every American federal tax relief for health care.

That's where I'd start.

boring and way too little , way too late.

We already have a $50-100 trillion unfunded liabilities shortfall. Shedding a few billion in tort expenses and defensive medicine costs is a drop in the ocean.

End the entitlements but finish owning up to what has already been contracted and paid for. And claw back what has been stolen. Either in blood or with taxation on the richest.

 

[finebead]

PoliticalChic,

Some good ideas in there. Some not so good.

We voted in tort reform here in TX about 8 years ago. Costs have NOT come down a bit, they still accelerate at 2 to 3 times the inflation rate, just like everywhere else. I have seen no difference. One difference I have heard of is down on some of the border towns, there were no practicing obstetricians in some towns because of the frequency of lawsuits. Women had to drive LONG distances, like a hundred miles. Some obstetricians have returned to practice along the border now.

But the post addresses some ways to control costs, I think in minor ways compared to the total problem. It does NOT address who will pay for retiree healthcare in the model the US has chosen, where employers are supposed to provide healthcare. But more and more employers have been dropping healthcare for employees because costs are rising too rapidly. So, the whole model has failed. We have a great system for the wealthy and well insured, but not for everyone else.

I don't see how most people could pay for their own health insurance after retiring, heck, many can't pay their rent because they have not saved adequately for their retirement without the burden of healthcare. Employers certainly won't pay for their retirees healthcare. The govt. pays for medicare because there is nobody else to do it.

It needs to become more efficient. We need to prosecute medicare fraud more aggressively. We need to correct abuse where home services leave equipment at homes that is NOT WANTED by the patient, so they can continue to bill the govt. (don't worry, medicare will pay for it).

But I don't see an alternative to medicare. Anyone else think they can carry the freight when the premiums should be the highest, after you've stopped working?

 

[uscitizen]

One thing is for certain. Shortness of vision is not limited to the progressives.