Category Archives: markets

Repealing Obamacare

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Republicans—leadership, rank and file—and Conservatives want to repeal Obamacare, and they’re right to do so. Obamacare has been an unvarnished disaster for our nation.

To this end, Republicans need to pass repeal legislation and put it on President Barack Obama’s desk, where he surely will veto it. That veto will work to Republicans’ benefit as it helps shape the 2016 elections, but things must not stop there.

The leadership also is playing small ball, working a piecemeal approach. This includes

  • a bill that would define a full-time worker under the health law as working 40 hours per week
  • repeal [of] the…2.3% tax on medical devices such as X-ray equipment and artificial joints
  • a bill that would allow Americans to opt out of the law’s individual requirement to buy insurance

Other pieces that need to be addressed, say I, include

  • repeal of the employer mandate to provide insurance
  • repeal of the contraceptive mandate

All of this will require the Republicans on the right side of the party—the Cruzes, Gohmerts, and so on—to exercise far more patience than has been their wont. Repeal’s veto won’t be overridden, we need a Republican President to sign a re-passed repeal. Most of the piecemeal approaches also will be vetoed, and most of those will be sustained by the Democrat minority in each House. But all of these votes, initial passage and veto override alike, should be by roll call. With all the Democrats—every single one of them—explicitly on the record as favoring the Obamacare disaster, those votes will very favorably shape the ’16 elections.

But that’s not enough. Even when successful, the result will be a return to the status quo ante-Obamacare. The then-existing health insurance and health provision industries badly need restructuring. Republicans need to have in place a plan to achieve that and a timetable for the plan’s execution.

House Ways and Means Committee Chairman Paul Ryan (R, WI) has been cited as saying

that Obamacare would be replaced with something that gives Americans more choices and lowers costs, improves their access to care and is “truly patient centered….”

But he says he does not have a “timeline.”

House Speaker John Boehner (R, OH) has said

Our challenge, our opportunity is to pass common-sense solutions…that repeal Obamacare and replace it with patient-centered reforms that will help our constituents have better access to high-quality health care in America….

That’s not enough: it’s time to get specific. It’s time to lay out exactly what legislation will be proposed to restructure those two industries.

There’s this critical caveat, too. Accepting arguendo Obamacare as a general solution for the restructuring, it was doomed to fail because it tried to do too much all at once. The restructuring of those two industries, even in accordance with Conservative imperatives, will see a similar doom if it attempts the restructuring all at once. These industries need to be restructured piecemeal. Pass legislation to correct (some of) the worst ills in one session, and use the year to observe how those corrections worked and where they failed. In the next year of the session, correct the corrections where necessary and pass legislation correcting the next worst ills. And so on, year by year. The industries can be favorably and successfully restructured over the course of 4-6 years (much faster than the 80 years it took to get to the point of Obamacare, but not overnight, and especially not in one fell swoop).

But that takes patience. All or nothing right damn now will only achieve nothing. With Obamacare left in place.

Carbon Footprint

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[I]n 2011, the University of Technology Sydney made a significant breakthrough by synthesizing something called graphene paper (GP), an ultra thin layer of graphite that has five to six times lower density than steel, but is two times harder with 10 times the tensile strength and 13 times higher bending rigidity.

GP also works well in lithium-ion batteries and even better in lithium-sulfur batteries. The latter kind has far greater storage capacity and is a whole lot cheaper; GP solves the sulfur degradation problem.

There’s a lot more at the link.

Of course there are practical problems yet to be solved at this early stage. A carbon fire burns hot. Get the car, or pickup, too light, and the shock absorbers will need serious redesign—a particular problem for working pickups that do off-road work. But still….

An all-carbon vehicle? Gah. The horror.

Colleges, Again

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Frank Mussano and Robert Iosue opened their op-ed in The Wall Street Journal with this claim:

College tuition rates are ridiculously out of hand.

They’re right, too. College costs, and not just their tuition costs, are way out of whack with the value received. One evidence of that (eliding interest costs) is the extreme difficulty too many college graduates have paying back their student loans out the salaries their degrees get them.

They continued:

[T]uition has surged more than 1,000%, while the consumer-price index has risen only 240%. The percentage of annual household income required to pay the average private four-year tuition reached 36% in 2010, up from 16% in 1970.

They spent much of their piece describing where a college’s money goes, a number of a college’s cost drivers, and the way in which much of the money is outright misallocated, and they’re not far wrong.

Mussano and Iosue then suggested that one way of getting costs back under control would be to do a business model-type financial audit of the schools.

However, they missed one important driver of cost: demand. I’ve written before about the lack of any universal need for a college education.

We as a society need to de-stigmatize the lack of a four-year degree. College isn’t for everyone. Not everyone is cut out for college, especially right out of high school; colleges don’t always teach what the student wants, or needs, on a practical level; and where they do, they’re not cost competitive with other sources of that knowledge and training.

Trade schools, office skills training, and the practical, hands-on here’s-how-you-do-this-stuff-to-make-a-living-at-it training available at junior colleges (two-year colleges that are nearly always cheaper than two years at a four-year college) are excellent places to learn to earn a living.

The trades are critical skills, too. Who can build a house or an office building—or live or work in one—without a plumber, an electrician, a carpenter? Who can build a road or an internet or telephone network without heavy equipment operators, electricians, someone who understands networks at the construction level?

Skills like these don’t need a four-year degree, especially in women’s studies, or anthropology, or English, or even STEM. Yet without those skills, our country would come to a screeching halt. There’s a crying need for STEM graduates, even for English and anthro majors. But there’s a bawling need for the trades. We can’t use the STEMs or English and anthro types without them.

Oh, and demand: with the commensurately lowered demand for college, watch tuition and other college costs come down.

Government Intrusion

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…into citizens’ lives, and one State government’s response.

Virginians who try to sell homemade food from their kitchens are feeling the heat from state and local inspectors.

“I have to turn down my neighbors when they ask if they can buy pesto I make from my own basil plants,” says Bernadette Barber, a farmer in Lancaster, VA.

And

In Arlington, government inspectors shut down a home-based soup maker, even though no customer complaints had been registered. Others have encountered similar fates, stripping them of needed income.

Because Government Knows Better. And there might be a problem.

No. Our Constitution was designed to facilitate us restraining government beforehand, not the other way around. The Virginia legislature appears to understand that.

HB 1290, sponsored by Delegate Rob Bell, R-Charlottesville, would end home-kitchen inspections on items produced for direct sale. The goods would bear a label stating that the products are not for resale and were processed without state inspection.

Absent this, government, “You’re missing a good opportunity to shut up.” It’s worth tracking this bill to see whether it gets enacted.

How’s Obamacare Working Out?

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How’s Obamacare Working Out?

President Barack Obama offered this justification for the structure of his Obamacare:

My guiding principle is, and always has been, that consumers do better when there is choice and competition. That’s how the market works. Unfortunately, in 34 states, 75% of the insurance market is controlled by five or fewer companies. In Alabama, almost 90% is controlled by just one company. And without competition, the price of insurance goes up and quality goes down.

How’s he doing by his own standard?

  • In 2015, 89% of total US counties will have five or fewer companies selling coverage in the exchanges. In 2014, 94% of counties had five or fewer insurers on the exchange.
  • In 2015, the exchange market in 57% of US counties will feature competition among three or fewer insurers. In 2014, 78% of all counties had three or fewer insurers.
  • In Texas, 62% of the state’s counties have only one or two insurers offering coverage in the exchange in 2015. There are 14 different insurers selling policies on the Texas exchange, but no Texas county has more than nine carriers offering coverage.
  • West Virginia still has only one insurer offering coverage on the exchange in 2015. Thus, any state resident purchasing coverage on the ACA’s exchange has no choice of insurer.

A tiny bit of improvement over last year, except in West Virginia, where 100% is controlled by just one company.

But.

By another measure, this one the GAO’s, as reported at the link above,

…in 2013 the individual insurance market encompassed 1,232 insurance carriers selling full health coverage. Obamacare exchanges support just 310 insurance companies as of 2015.

Lastly, this is the trend according to the GAO since Obamacare became law; some of the data predate ObamaMart’s activation:InsurerShare

Hmm….