Tag Archives: political parties

State of the Union

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Third verse, same as the first.  President Obama’s speech Tuesday night before the Congress, although couched in rousing terms of “teamwork” and “rebuilding America,” was in the end just more of the usual Progressive fare of class warfare, higher taxes and spending, and bigger government.

While promising to work toward job creation, Obama already has cancelled the Keystone XL pipeline, which would have been worth a prompt 20,000 construction and construction-related jobs and an additional 100,000 plus follow-on, more permanent jobs.  While promising vast reductions of intrusive regulations (he actually cited only a single elimination, that of 40-year-old regulation concerning treating spilled milk as an oil spill), his EPA has been running amok with intrusive regulations, from dictating the light bulbs we’re allowed to have in our bed- and bathrooms, to closing down badly needed electricity power plants (with their jobs and the jobs of the businesses that need that power) with excessive “pollutant” regulations that will do nothing to improve our environment or our health, to expanded regulations in the medical device industry that will stifle innovation in that vital area, and on and on.

He wants to reform our tax system, he said, but only to raise taxes on disfavored groups while “reforming” it through extending a payroll tax holiday that guts funding for Social Security;  “double[ing] the tax deduction” for businesses that manufacture in the US, adding to the Byzantine complexity of our corporate tax code; taxing revenue (all of it) from the sale of those severely regulated medical devices; and so on.  But he refuses to accept an overall reduction in income taxes in substitution for that general payroll tax reduction, he refuses to simplify the code and reduce the rates for all corporations—or for all individuals.  Instead, he wants to raise taxes on his “wealthy,” the top 5% of whom pay nearly 60% of the nation’s income taxes, while he refuses to talk about the taxes of the 50% of Americans who pay around 3%-4% of the nation’s income taxes while.  He wants to eliminate the tax breaks for

an [oil and gas] industry that’s rarely been more profitable, and double-down on a clean energy industry that’s never been more promising. Pass clean energy tax credits….

Yes—he refuses to eliminate the same subsidies for his “green” energy efforts, like Solyndra, et al.

Obama said he wants an “an economy where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same set of rules.”  This from the president that shoved senior creditors (at least as defined by existing bankruptcy law) to the back of the bus and gave preferential treatment to his union donors in the government-union takeover of GM and Chrysler.

And he promised openly to continue to govern by fiat whenever our democratic process won’t let him get his way:

With or without this Congress, I will keep taking actions….

Next, there are factual errors in Obama’s speech.  He claimed that Obamacare “relies on a reformed private market, not a government program.”  But the fact is that fully half the more than 30 million currently uninsured are expected to receive coverage through government programs, while the other half are expected to be enrolled in government-approved “private” health insurance through state-based insurance markets.  Moreover, many of these will be get federal subsidies to do so.  Further, Medicaid will be expanded drastically.

And there’s this:  “On the day I took office, our auto industry was on the verge of collapse. Some even said we should let it die. With a million jobs at stake, I refused to let that happen.”  I’ve addressed above some of the corrections to this claim.  Here’s more: the bailout actually began under President Bush the Younger.  Ford, though, the other member of the American auto industry as Progressives define it (eliding Toyota, Nissan, Honda, Volkswagen, etc. that also have major manufacturing plants in the US and so are key participants in the American auto industry) took none of the bailout money.  Furthermore, if we’re limiting the “American auto industry” in the Obama manner, Chrysler is no longer a part: it’s owned by Fiat, an Italian company.

Finally, although Obama gave short shrift to America’s foreign affairs, he did claim this.  “The Taliban’s momentum has been broken, and some troops in Afghanistan have begun to come home.”  However, the latest National Intelligence Estimate says that the Taliban will grow stronger, and it’ll use Obama’s unilateral offer of “negotiation” for delay.  The NIE adds that the Taliban in fact will end controlling the Afghan countryside—which gives it the cities

Government Intervention Gone Awry

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Peter Suderman, writing for Reason, suggests that Obamacare, far from being the cost saver the Progressives insist it to be, actually is a cost increaser.  It seems that Obamacare is inflating health benefit costs at a sharply more rapid pace than was the rate of increase before Obamacare’s ram-through.  According to a series of Kaiser Foundation annual surveys of employee health benefits, in 2008, the cost increase for employer-provided family health benefits was 5%.  In 2009, the cost increase was 5% again, and in 2010—the year Obamacare was passed before anyone was allowed to know what was in it—the cost increase was only 3%.  But in 2011, that cost increase was 9%.  And it’s going to get worse.

This is reminiscent of another government intervention into our health care system: the creation of Medicare.  Under the Johnson administration, Medicare (and Medicaid) were established as interventions in the market for medical services because government Knew Better then, too, how markets should work.  Far from reducing costs, though, these programs also made the situation worse.  In the year before Medicare was passed, the cost of a hospital bed was rising at 5% per year—three percentage points above the overall rate of inflation for that year.  By the fifth year following Medicare’s enactment, the cost of that same hospital bed was rising at 8% per year, a 60% increase in the rate of inflation for that bed, against a baseline, still, of just 4% overall inflation—the relative cost of a bed had doubled.  Further, the combined “advantage” of Medicare and Medicaid, through 2001, accounted for fully 25% of the inflation in the overall cost of medical care.  The tax exempt status of employer-provided medical coverage (another “boon” for the individual), accounted for another 33% of the inflation in total medical services cost: these two government interventions were responsible for nearly 60% of the inflation in the cost of medical care.

Medicare premiums themselves have risen rapidly since the inception of the program.  1965’s $3 per month premium had risen to $94.60 in 2011.  If the premiums had only risen with general inflation, they would be in the $14-$15 per month range today.  Additionally, the doctor and hospital reimbursement rates—those Medicare-approved amounts—are too low to allow the doctors and hospitals involved to recover their costs.  As a result, these health service providers are driven increasingly to refuse Medicare patients altogether.  Despite this, Medicare participation is mandatory: Americans must purchase Medicare, whether they want it or not, even in the face of this dwindling service, and this artificially elevated demand for a decreasing supply also contributes heavily to cost increases.

Mandatory participation in Medicare has not achieved the goal claimed for it: an overall reduction in the cost of health services.  It is, though, succeeding in reducing the availability of medical services generally.

And so it is with Obamacare.  New mandates—the Individual Mandate, requirements that insurance companies cover people’s health condition, regardless of risk and at government mandated price ranges—increase demand.  Although there are those price controls, the regulations will drive insurers increasingly out of an increasingly unprofitable market, and this will drive costs upward in the form of inaccessibility of health services and long waits.  Further, Obamacare’s tax hikes will be passed on to consumers.  There are those price controls, but as we saw with the Nixon price controls, ways will be found around them.

Rest assured, also, the quality of care will fall through the floor, too.  There’s another Obamacare regulation: medical loss ratios, whose values are mandated under Obamacare, require insurers to spend a high percentage of their premium revenue on federally defined clinical services (Government-mandated, not market-driven, and so not necessarily wanted by us), and this is at the direct expense of R&D.  And of course health insurers are interested in research—not only in how to better provide insurance products to customers (there are profits to be made in offering better products and doing so more efficiently, and without those profits, the search for more and better won’t occur), but also in medicine itself.  Medical research is part of that search for profit: more, and more efficiently provided, medical services also are profitable, as is a long-lived, healthy customer base.  Only now there’ll be less money available for that research.

Once again, we’re stuck with an artificially elevated demand for dwindling supplies, and this time supplies of decreasing quality as well as quantity.

Some Thoughts on a New Hampshire Exit Poll

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A Fox News Exit Poll has some interesting tidbits from the just concluded New Hampshire Republican primary.  It’s important to note that in New Hampshire, Independents can vote in the Republican (or Democrat) primary, unlike the Iowa caucuses, where caucusers(?) must register in one party or the other (albeit they can register on the spot).  Finally, my summaries below talk about pluralities of the vote, rather than absolute majorities, unless I explicitly indicate otherwise.

The nearly final votes (Fox News was reporting with 95% of the precincts calling in their numbers) notwithstanding, the race was essentially between Romney and Paul, with Huntsman a strong afterthought and the others just getting in the way.  This is clearest with the age breakout exit polling: as the voters got older, they went more strongly for Romney; their only other serious candidate was Paul—who lost his edge somewhere in the voters’ mid-30s.  The other candidates just siphoned votes from these two.

The more educated the voters, the more strongly they went for Romney over Paul, although the split was, at all education levels, strongly pro-Romney.  Income level outcomes roughly mirrored the education level results; however, this is expectable, as education level strongly influences income level, especially as voters age into their careers.

On more politically oriented characteristics, the results get interesting.

Self-identified Democrats went for Paul  (the cynic in me sees two possible reasons; take them with a shaker of salt: the Democratic Party tried to influence the Republican primary, and/or Paul’s foreign policy is even more strongly Democratic than President Obama’s), while self-identified Independents split roughly evenly between Paul and Romney, with a slight edge for Paul.  On a self-identified Liberal-Conservative spectrum, the more conservative the voters, the more strongly they went to Romney, but Paul never had a significant advantage on the Liberal end: these split roughly evenly between Paul and Romney.  (Compare this with the self-identified party affiliation outcome….)

There aren’t any self-identified liberal tax and spenders in this state; the farthest Left they go is “moderate.”  And these all went strongly for Romney.  Interestingly, moderates and moderate conservatives slightly favored Huntsman over Paul.

On the social issue (gay marriage and abortion) Liberal-Conservative spectrum, only the most Liberal went to Paul; although Huntsman got a significant per centage of their votes.  The Somewhat Liberals favored Huntsman over Paul, and this group also liked Huntsman nearly as much as Romney (slightly more than one-third went to Romney, slightly less than one-third to Huntsman).  All the rest of the spectrum—Moderates to Strongly Conservative—went strongly for Romney.

Those strongly opposing the Tea Party strongly favored Huntsman.  Everyone else on the Tea Party Oppose-Favor spectrum went to Romney; although the somewhat opposers split their votes between Romney and…Huntsman (slight edge to Romney).

The single-issue voters were the only ones where Santorum had a good showing: where abortion was key, Santorum received a very strong plurality.  On the budget deficit, the voters were split between Romney and Paul, and on the economy, they strongly favored Romney.  Health care wasn’t a factor.

The single-candidate-quality voters who considered beating Obama the be-all and end-all went for Romney with a strong absolute majority—62%.  Where being a true conservative was most important, they went to Paul with a strong plurality, and Romney, Gingrich, and Santorum essentially split the rest (slight edge to Santorum among these three).  Where having a strong moral character was the thing, the voters again gave a sharp plurality to Paul, this time with the rest split among Romney, Santorum, and Huntsman.  The right experience voters split between Romney and Huntsman.

Among those feeling dissatisfied with the Obama administration, or outright angry with it (not many were as favorable toward it as “satisfied, but not enthusiastic”), most went to Romney; among the outright angry, Paul and Santorum split those who didn’t vote for Romney.  Among those somewhat to very worried about the future of our economy, the voters again went to Romney; although among the moderately worried, the rest of the voters essentially split between Paul and Huntsman.

The voters themselves were split between whether their elected officials should compromise to get things done or stick to their principles.  Both groups, though, favored Romney.  The compromisers also liked Huntsman, and the principles first-ers like Paul nearly as much as Romney.

The series of questions concerning voter satisfaction if this or that candidate won the nomination was interesting.  Nearly two-thirds of the voters would be dissatisfied if Gingrich were to win, three-fifths would be if Santorum were to be nominated, and over half would be if Paul were to be nominated.  On the other hand, three-fifths would be satisfied were Romney to be nominated.

The long series of debates paid off in New Hampshire: 80% of the voters considered them somewhat to very important to their voting decision, while over half the voters didn’t give a hoot about campaign advertising.  However, nearly a third gave some weight to the ads.

Oddly, unmarried voters broke more strongly for Paul than did their married counterparts, handing Paul a strong plurality in this demographic.

This is a strongly conservative state; they went strongly for Romney; and the more strongly they felt about anything, the more strongly they went for Romney, with some isolated exceptions.  They also liked the Libertarian Paul and the RINO Huntsman, but the self-proclaimed “true conservative” candidates the state essentially told to take a hike.

Federal Spending: Why Is It Still Rising?

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As The Wall Street Journal reports, total Federal spending will run to $3.65 trillion in 2012, up from $3.6 trillion for the just concluded 2011.  So, what happened to the spending cuts the Republicans promised in the run up to the 2010 elections?  A funny thing happened on the way to the Washington pig trough.

The Democrats, in the summer debt ceiling “negotiations,” blocked any savings more extensive than $7 billion before they would allow any sort of deal on the debt ceiling to be concluded.  Only 28 programs, out of the thousands Washington uses for vote buying, got cut—and these involved nothing but walking around money: a $1.2 million program for “civic education” was eliminated, for instance.  With the Solyndra scandal pushing hard, DoE’s loan guarantee program for “green” startups got axed, though.

What else?  Amtrak, the Legal Services Corporation, National Public Radio, the United Nations population program, mass transit grants, funding for the UN’s Climate Panel all were retained. Spending actually went up for other programs: the National Institutes of Health, the Consumer Product Safety Commission, Indian Health Service, Bureau of Land Management, for instance.

Again, I ask: what happened?  The House did, after all, pass a serious budget with real cuts in it and a plan for entitlement reform.  But Obama and the Democratic Party-controlled Senate simply blocked everything else.  In the Senate, the Democrats simply refused to propose a budget of their own so those negotiations could be carried out—no discussion at all occurred.  The Democrats scored Congressman Paul Ryan (R, WI) for being so rude as to propose changing entitlements, instead of debating the matter, or offering their own ideas.

And the Republican leadership acted like a bunch of neophytes and idiots. The Republicans failed to respond to the attacks on Ryan for his proposals.  They got conned by a boxer from Nevada and a small-time neighborhood organizer from Chicago.  Republicans were suckered into secret meetings with Obama, who publically assured all who would listen that he really wanted fiscal discipline, and then in those secret meetings, he demanded $1 trillion in tax hikes.  When the Republicans could not accept that increase, Obama attacked them publically for blowing up the negotiations.  Then they let the Democrats beat them up over payroll tax cuts instead of calling the Democrats out for defunding Social Security and pushing instead for income tax cuts—of the permanent kind—of the same per centage reductions as the Dems’ payroll cuts.

It went like that all year.  Republican naïve (naïve! after all their years in Washington) leadership being played like a cheap fiddle, and they were unable to respond.  Maybe this crop of Republican leaders are too used to being in the minority, too used to losing: they no longer know how to win.  Worse, they no longer have actual conservative principles to defend and to push for.

The WSJ suggests this for the Republicans:

They need to draw contrasts with Democrats on taxes, spending, regulation and reform that at least educate the public about what’s at stake.  Pick some programs and make them budget-cutting showcases.  Use the savings to finance tax cuts that promote growth.  Or simply vote for tax reform whether or not it is “revenue neutral” under Congress’s silly budget rules.  Follow votes in the House by bringing pro-growth bills to the Senate and forcing Democrats to vote up or down, as they did with the Keystone XL pipeline.

Maybe the Republicans need new leadership—in both chambers—before they’ll be able to do this.  The current crop of leaders started strong—and then let the community organizer lead them around like a trained pony.

Progressives, RINOs, and Taxes

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Now that the Republican fiasco with the temporary payroll tax cut is sort of ended for a little bit, it’s time for these gentlemen and gentlewomen to recover their heads from rectal storage and get serious—and coherent—about tax policy for the US.

This last week has been a textbook example of a Keystone Kops failure to perform.  Others can run the post mortem on their failure; I want to look ahead to early in the next year.

When the new year dawns, and the “negotiation” over the payroll tax cut extension for a whole year begins, we can expect the Progressives to resume their hobby horse demand to pay for the tax cut with their class war-oriented tax increase on groups of Americans of whom they utterly disapprove.  The House Republicans and the Senate RINOs need to change the terms of that debate, rather than continuing to surrender the frame of the discussion to the other side.

The discussion needs to acknowledge, with gratification, the Progressives’ avowal that tax cuts are good for Americans and our economy.  The discussion needs to acknowledge, with enthusiasm, that the Progressives want a 2% tax cut for Americans, and that their leader, President Obama, wants a 3% tax cut on both employees and employers.

Then the House Republicans, and their nominal colleagues, the Senate RINOs (assuming the latter can find their principles anywhere at all nearby), need to push for an income and corporate tax cut of 3%—just as Obama has asked for.  And also acknowledging the need for stability and predictability for all Americans, these worthies need to push for the income tax cuts to be permanent—no more of this annual dual between talking point lists for personal political gain.  After all, as Obama himself said all week long, the $40 per paycheck that this small cut represents “makes all the difference in the world” to those who get it.  Of course, these $40 should be made permanent.

The Republicans and RINOs also need to push the Progressives, when the latter resist the income tax cut and its permanence, about the Progressives’ demand, instead, to reduce funding for an already dysfunctional Social Security system while they also refuse to allow reform of the system (or of Medicare or Medicaid, come to that).

I look forward to the Republicans and the RINOs getting their act and their message together, recovering their integrity and their principles, and arguing for a more serious, income, tax cut.  And after that, they need to push, for the same reasons, for the permanence of the Bush tax cuts (and not allow this also to be merely another periodic talking points duel).