- Jun 6, 2007
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Washington has gotten on the wrong path with respect to raising the nation's debt ceiling. A week to two weeks ago the whole "debt ceiling " debate was headed in the direction of lets cut the nation's deficit by two trillion over the next ten years with three parts cuts in federal spending and one part federal revenue raising. That course seems to have fallen by the wayside with now the plan being to come up with four trillion dollars of deficit spending cuts over twelve years in conjunction with a lifting of the debt ceiling. This change of plans is super unwise and super foolish, to implement the first plan many experts would characterize as climbing a ninety degree cliff that would stretch human limits to achieve now the new plan is to climb a cliff twice as high, its foolishness and bad judgment beyond accurate description!
President Obama and Democratic leaders should stick to the two trillion plan and all the politicians on both sides of the aisle should keep some things in mind if they want to reach a deal and save America from the economic "debt ceiling caused" catastrophe the nation is racing toward in August of this year! The politicians on both sides of the aisle have to stop the Trojan Horse proposals they are offering as solutions which are really sucker deals for the other side. There is many being tossed about but here is a sampling. The Democrats have proposed cutting Medicare by a trillion dollars over twelve years through cuts to hospital providers; many hospitals are operating in the red taking a trillion dollars from the hospital industry will cause many more to go into the red the public outcry from hospitals and vested parties and the ensuing politician backlash would never let such cuts go through, its like the medicare doctor cuts which medicare law mandates but every year or two Washington blocks, for crying out loud the Medicare Advantage cuts which the 2010 Health Care Reform Law mandates and which equities compelling calls for to be implemented aren't being implemented because of political blowback from Medicare Advantage issuer and enrollees and their supporters. The Democrats proposal to cut $100 billion from Medicaid over ten years what is this from the waste, fraud and abuse in the system, politicians have been using that line since the program began no one thinks Washington is going to cut enrollees, enrollees being people in poverty or the children that receive medical care through this program, let's see a significant number of Washington politicians first put on their website that their calling for significant cuts to the "CHIP" program before this proposal is pursued. The Republicans fare no better with their proposal that they will agree to close the unpalatable tax loopholes for businesses if it is accompanied with a lowering of the business tax rates which they espouse will increase American businesses income and thus increase tax revenue; if Republicans are pressed for details they will only agree to close the politically unpalatable, indefensible and the like loopholes and that is "at best" which will only amount to a small reduction in corporate tax rates resulting in a negligible increase in corporate tax income to America and squandering an opportunity created by these indefensible loopholes to really fix America's tax system for businesses.
If Democrats hold any chance of getting a debt ceiling raising with deficit reduction with three parts spending cuts one part revenue raising this is what they need to do, this comes from an independent Reaganite which means that my perspective is probably in the ball park of moderate Republicans in Congress which Democrats need to garnish support from if they are to succeed here. First, Democrats stop your offers of generalize cuts in spending if a smart republican is to agree to specific revenue raising he or she is going to want specific spending cuts that will stick (won't be reversed in future budgets) in the debt lifting legislation. Don't offer generalized cuts in Medicare offer specific cuts like offer to change Medicare law so that there is a ban on Medicare paying nursing homes $422 per day for one hundred days after one of their residents is released from a hospital admission back to the nursing home where the regular cost for a nursing home resident is a $172 per day and is paid by Medicaid this whole pay arrangement encourages nursing homes to send residents to hospitals unnecessarily - nursing homes should just get the regular compensation, however if the resident needs extra nursing care or the like upon return to the nursing home Medicare can compensate the nursing home for its actual added cost but it has to be medically necessary costs. Don't offer generalized cuts to Medicaid offer specific cuts like the following, this is a layman characterization of the issue so recognize there may need refinement on this idea - today a person can enter into a nursing home under the following arrangement turn all their assets over to the nursing home sell their personal residence and turn the proceeds over to the nursing home and once all these person's assets have been exhausted paying the nursing homes charge for staying at the facility the respective state medicaid program begins paying that nursing home for the stay of that person at the facility. In short, medicaid programs are paying the cost for a lot of people who are residents in nursing homes across America that was fine and dandy when America could afford this expense, today there is no issue America can't afford this expense so the Congress and the President should put in this debt ceiling legislation that this Medicaid program will end immediately and that means end forever except nothing will change for those residents already in the program Medicaid will continue to pay their nursing home for their staying in the facility; the cessation of the program should save billions over the long-term plus when one thinks about it is really unfair to many seniors because this results in many seniors living in nice nursing homes and others living in not so nice nursing homes and others not having the benefits of living in a nursing home at all and the government paying the tab for this first group to put it another way the government here is paying for the disparity of treatment of seniors it is frankly discriminatory!
Democrats should hammer at the shared sacrifice argument it is a winning argument. In addition, the Democrats should hammer at the wrongfulness of these tax loopholes argument it is likewise a winning argument. The ethanol subsidies are a bad subsidy ethanol producers should stop using corn as feed stock they need to be using cellulosic feedstock farmers should be using their fields to grow food to feed people, haven't you folks in Washington noticed that the price of grain commodities have skyrocketed in the last eighteen months because of shortage of supply. This tax loophole for hedge fund and private equity managers where they get to treat their compensation as income subject to capital gains and not ordinary income tax rates is egregiously unfair compensation is compensation whether your picking up and delivering goods as truckers do or picking up and delivering investments as hedge fund managers do, these guys and gals should have their compensation taxed at ordinary income tax rates however they shouldn't have to pay their tax bill for seven/ten years from when they received their interest or when they turn that compensation which is often a portion of a business into cash. The tax breaks for oil companies for oil production is wrong and unfair and should be eliminated, American consumers and end users over pay for petroleum products a perfectly fair price for a barrel of oil is around seventy-five to eighty-five dollars that would give oil producers at least a good profit and still provide a good incentive for further oil development; since oil companies are getting such a great and excessive price for their products at the expense of American consumers they can forego the tax break from American consumers/taxpayers related to the manfucturing (I mean production) of their product!
You bigwigs in Washington need to get it that there is no time for a grandiose bargain on the nation's deficit when it comes to the "raising the debt ceiling" legislation. If Washington's delay here causes a downgrade in America's credit rating and the corresponding increase in America's various interest rates and the drop in the dollar and/or causes America's financial markets to panic or otherwise experience a dramatic drop in value the American people will and should never forgive you! Listen to the most credible voice on economic matters living in America today and I think his reconfirmation hearings corroborates such a claim - I am referring here to Ben Bernanke; Mr. Bernanke recently cautioned Congress and the President essentially to not play games with lifting the nation's debt ceiling - this is not the circumstances to bring a big confrontation over deficit spending this debt ceiling must be raised and raised quickly a catastrophe of historic proportions could result from delay here!
President Obama and Democratic leaders should stick to the two trillion plan and all the politicians on both sides of the aisle should keep some things in mind if they want to reach a deal and save America from the economic "debt ceiling caused" catastrophe the nation is racing toward in August of this year! The politicians on both sides of the aisle have to stop the Trojan Horse proposals they are offering as solutions which are really sucker deals for the other side. There is many being tossed about but here is a sampling. The Democrats have proposed cutting Medicare by a trillion dollars over twelve years through cuts to hospital providers; many hospitals are operating in the red taking a trillion dollars from the hospital industry will cause many more to go into the red the public outcry from hospitals and vested parties and the ensuing politician backlash would never let such cuts go through, its like the medicare doctor cuts which medicare law mandates but every year or two Washington blocks, for crying out loud the Medicare Advantage cuts which the 2010 Health Care Reform Law mandates and which equities compelling calls for to be implemented aren't being implemented because of political blowback from Medicare Advantage issuer and enrollees and their supporters. The Democrats proposal to cut $100 billion from Medicaid over ten years what is this from the waste, fraud and abuse in the system, politicians have been using that line since the program began no one thinks Washington is going to cut enrollees, enrollees being people in poverty or the children that receive medical care through this program, let's see a significant number of Washington politicians first put on their website that their calling for significant cuts to the "CHIP" program before this proposal is pursued. The Republicans fare no better with their proposal that they will agree to close the unpalatable tax loopholes for businesses if it is accompanied with a lowering of the business tax rates which they espouse will increase American businesses income and thus increase tax revenue; if Republicans are pressed for details they will only agree to close the politically unpalatable, indefensible and the like loopholes and that is "at best" which will only amount to a small reduction in corporate tax rates resulting in a negligible increase in corporate tax income to America and squandering an opportunity created by these indefensible loopholes to really fix America's tax system for businesses.
If Democrats hold any chance of getting a debt ceiling raising with deficit reduction with three parts spending cuts one part revenue raising this is what they need to do, this comes from an independent Reaganite which means that my perspective is probably in the ball park of moderate Republicans in Congress which Democrats need to garnish support from if they are to succeed here. First, Democrats stop your offers of generalize cuts in spending if a smart republican is to agree to specific revenue raising he or she is going to want specific spending cuts that will stick (won't be reversed in future budgets) in the debt lifting legislation. Don't offer generalized cuts in Medicare offer specific cuts like offer to change Medicare law so that there is a ban on Medicare paying nursing homes $422 per day for one hundred days after one of their residents is released from a hospital admission back to the nursing home where the regular cost for a nursing home resident is a $172 per day and is paid by Medicaid this whole pay arrangement encourages nursing homes to send residents to hospitals unnecessarily - nursing homes should just get the regular compensation, however if the resident needs extra nursing care or the like upon return to the nursing home Medicare can compensate the nursing home for its actual added cost but it has to be medically necessary costs. Don't offer generalized cuts to Medicaid offer specific cuts like the following, this is a layman characterization of the issue so recognize there may need refinement on this idea - today a person can enter into a nursing home under the following arrangement turn all their assets over to the nursing home sell their personal residence and turn the proceeds over to the nursing home and once all these person's assets have been exhausted paying the nursing homes charge for staying at the facility the respective state medicaid program begins paying that nursing home for the stay of that person at the facility. In short, medicaid programs are paying the cost for a lot of people who are residents in nursing homes across America that was fine and dandy when America could afford this expense, today there is no issue America can't afford this expense so the Congress and the President should put in this debt ceiling legislation that this Medicaid program will end immediately and that means end forever except nothing will change for those residents already in the program Medicaid will continue to pay their nursing home for their staying in the facility; the cessation of the program should save billions over the long-term plus when one thinks about it is really unfair to many seniors because this results in many seniors living in nice nursing homes and others living in not so nice nursing homes and others not having the benefits of living in a nursing home at all and the government paying the tab for this first group to put it another way the government here is paying for the disparity of treatment of seniors it is frankly discriminatory!
Democrats should hammer at the shared sacrifice argument it is a winning argument. In addition, the Democrats should hammer at the wrongfulness of these tax loopholes argument it is likewise a winning argument. The ethanol subsidies are a bad subsidy ethanol producers should stop using corn as feed stock they need to be using cellulosic feedstock farmers should be using their fields to grow food to feed people, haven't you folks in Washington noticed that the price of grain commodities have skyrocketed in the last eighteen months because of shortage of supply. This tax loophole for hedge fund and private equity managers where they get to treat their compensation as income subject to capital gains and not ordinary income tax rates is egregiously unfair compensation is compensation whether your picking up and delivering goods as truckers do or picking up and delivering investments as hedge fund managers do, these guys and gals should have their compensation taxed at ordinary income tax rates however they shouldn't have to pay their tax bill for seven/ten years from when they received their interest or when they turn that compensation which is often a portion of a business into cash. The tax breaks for oil companies for oil production is wrong and unfair and should be eliminated, American consumers and end users over pay for petroleum products a perfectly fair price for a barrel of oil is around seventy-five to eighty-five dollars that would give oil producers at least a good profit and still provide a good incentive for further oil development; since oil companies are getting such a great and excessive price for their products at the expense of American consumers they can forego the tax break from American consumers/taxpayers related to the manfucturing (I mean production) of their product!
You bigwigs in Washington need to get it that there is no time for a grandiose bargain on the nation's deficit when it comes to the "raising the debt ceiling" legislation. If Washington's delay here causes a downgrade in America's credit rating and the corresponding increase in America's various interest rates and the drop in the dollar and/or causes America's financial markets to panic or otherwise experience a dramatic drop in value the American people will and should never forgive you! Listen to the most credible voice on economic matters living in America today and I think his reconfirmation hearings corroborates such a claim - I am referring here to Ben Bernanke; Mr. Bernanke recently cautioned Congress and the President essentially to not play games with lifting the nation's debt ceiling - this is not the circumstances to bring a big confrontation over deficit spending this debt ceiling must be raised and raised quickly a catastrophe of historic proportions could result from delay here!
