Category Archives: Economics

Miscellaneous economy stuff

Who Enrolls in Obamacare?

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What’s the effect of that on costs under Obamacare?  The Blue Cross Blue Shield Association rudely conducted a study of the matter, and they found

  • New enrollees in individual health plans in 2014 and 2015 had higher rates of hypertension, diabetes, depression, coronary artery disease, HIV and Hepatitis C than those enrolled before ObamaCare.
  • New enrollees received significantly more medical care, on average, than those with individual or employer-based plans.
  • New enrollees had more inpatient admissions, outpatient visits, prescriptions filled and emergency room visits.
  • Medical costs for new members were, on average, 19% higher than for employer-based members in 2014, and 22% higher last year. Average monthly medical spending for those newly enrolled members also rose at a higher rate in that period.

And

A recent Daily Caller examination of annual reports from insurers also found storm clouds on the horizon of the exchanges.  It found that 8 of the 11 remaining exchanges may fail this year, despite assurances from the Obama administration.

All of which will lead to rising costs.  That increased use of medical care and health coverage plans, paid for with OPM, will drive health plan providers’ costs and so their premiums charged the customer (read: the government/your tax money).  The greatly reduced ObamaMarts will drive costs to the health plan provider customer, since subsidies—OPM—will be lost to them, also.

A report from Freedom Partners earlier this year showed premiums on the individual market are rising by double digits in most states.

Didn’t President Barack Obama (D) promise the contrary?  Both the current Democratic Party Presidential candidates are promising to extend this even further, too.

Elections have consequences.

A State Appeals Court Missed the Point

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Recall the California case, Vergara v California, in which nine students and the nonprofit advocacy group Students Matter, sued the State of California, arguing that the State’s tenure laws and its firing and layoff policies made it too hard to fire bad teachers, thereby denying students a decent education.  At trial, the students won, and the laws were struck as unconstitutional.  Naturally, teachers unions—California Teachers Association and California Federation of Teachers—anxious to protect its tenure perks, appealed.

Last Thursday, a State appellate court

said the plaintiffs had not successfully proven that some students were indeed getting an inferior education because of job protection provisions.

The appellate court wrote, with a straight face,

Although the statutes may lead to the hiring and retention of more ineffective teachers than a hypothetical alternative system would, the statutes do not address the assignment of teachers.  Instead, administrators—not the statutes—ultimately determine where teachers within a district are assigned to teach.

What the appellate court carefully ignored is that it doesn’t matter where bad teachers are assigned to teach.  The statutes in question require that they be assigned somewhere, to inflict their incompetence on unfortunate students somewhere.

That was the point of the suit: the statutes…lead to the hiring and retention of more ineffective teachers….

Score another victory of union prerogative over the welfare of our children.

A Presumption of Guilt

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The White House’s Office of Management and Budget earlier this week accepted for final review a rule that would force banks to identify the owners of companies behind shadowy financial transactions, such as the firms revealed in the Panama Papers scandal or the ones used to buy real estate.  It would close a loophole that critics say allows criminal money into the US financial system.

Never mind that the vast majority of the Panama Papers’ shell companies are entirely legitimate.  Never mind that, in a free country, there has to be probable cause driven by a presumption of innocence to go looking for “criminal money,” not just a government man’s idle suspicion, or a dislike for a person or an entity, or a liking for fishing expeditions.

Of course Government must be above such petty concerns.

A spokesman for FinCEN [Treasury’s Financial Crimes Enforcement Network, the originator of this rule] said the agency couldn’t provide specifics on the contents of any final rule, nor could he predict the timing for publishing a final rule.  He declined to comment further.

Of course not.  And of course.

This also represents another instance of this Democratic administration’s post-America attitude.

The International Monetary Fund weighed in as well, criticizing the US in July 2015 for failing to move quickly enough on identifying beneficial owners, saying the rule, as proposed, was too weak.

“There were no requirements for [financial institutions] to look beyond a customer to establish the identity of the beneficial owners in all cases,” the IMF said at the time.

Nor need there be, absent a court’s order based on probable cause, but hey—it’s an extranational institution that’s objecting.  That matters.

Sure.

Anti-Competitive G-20

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And, yes, that includes an anti-competitive Democratic Party administration representing the US in this group of twenty.

G-20 finance officials called on the Organization for Economic Cooperation and Development to report by July countries and jurisdictions that haven’t signed up to new international standards on tax transparency and information sharing.

“Defensive measures will be considered by G-20 members against non-cooperative jurisdictions,” the officials said in their statement after two days of meetings in Washington.

Wrong answer, guys.  Your threats just expose your own dishonesty.

If you really want to rein in the so-called tax havens, out-compete them in a free market: lower your own tax rates to competitive levels, and simplify your tax rules to eliminate your cynically Byzantine structures which serve only to benefit (or, just as bad, to appear to benefit) cronies and other government-favored groups.

The best defense is a good offense, but that offense must be directed at the right target.

“There is one thing which has not gone very global and that is taxation, which is still very much a local affair associated with national sovereignty,” IMF Managing Director Christine Lagarde said.

Why must taxation be standardized globalized?  What part of national sovereignty is unclear to you, Madam?

And further cynicism:

Revenue lost to tax havens is a sore point for the G-20….

It isn’t lost to you, guys; it isn’t yours to begin with, so it cannot be “lost” to you.  Again, compete: lower tax rates, and reduce the incentives to hide in “tax havens.”

And just to be clear (although, surely I’m preaching to the choir here:

haven 2. A place of refuge or rest; a sanctuary.

Thus, tax haven is a place of refuge from abuse by tax.

A Timid Administration

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Saudi Arabia has told the Obama administration and members of Congress that it will sell off hundreds of billions of dollars’ worth of American assets held by the kingdom if Congress passes a bill that would allow the Saudi government to be held responsible in American courts for any role in the Sept. 11, 2001, attacks.

And in response, President Barack Obama (D) once again bowed to Adel al-Jubeir, Saudi Arabia’s Minister of Foreign Affairs, who personally delivered the threat, and virtually to King Salman bin Abdulaziz.  Obama then responded to the Saudi threat, meekly.  He

has lobbied Congress to block the bill’s passage, according to administration officials and congressional aides from both parties….

This timidity is a part of what Democratic Party Presidential candidates Hillary Clinton and Senator Bernie Sanders (I, VT) insist they will perpetuate, should they be elected.

Elections have consequences.