Another Obama record…
AMERICANS GETTING POORER – HOUSEHOLD NET WORTH IN DECLINE
The median household net worth under Obama is one-third what it was during the Bush years.
Under Barack Obama American households are worth two-thirds of what they were worth under George W. Bush.
The New York Times reported:
Economic inequality in the United States has been receiving a lot of attention. But it’s not merely an issue of the rich getting richer. The typical American household has been getting poorer, too.
The inflation-adjusted net worth for the typical household was $87,992 in 2003. Ten years later, it was only $56,335, or a 36 percent decline, according to a study financed by the Russell Sage Foundation. Those are the figures for a household at the median point in the wealth distribution – the level at which there are an equal number of households whose worth is higher and lower. But during the same period, the net worth of wealthy households increased substantially.
The Russell Sage study also examined net worth at the 95th percentile. (For households at that level, 94 percent of the population had less wealth and 4 percent had more.) It found that for this well-do-do slice of the population, household net worthincreased 14 percent over the same 10 years. Other research, by economists like Edward Wolff at New York University, has shown even greater gains in wealth for the richest 1 percent of households.
Hat Tip Banafsheh Zand
It should come as no surprise then that Republicans overwhelmingly represent the middle class districts by almost a two-to-one ratio.
This story is about a gilded class of people and corporations enriched by the new American economy while the rest of its citizens pay the tab. The protagonists could be any number of institutional elites, but this column happens to be about a Democratic senator from West Virginia, Joe Manchin, and his daughter, Heather Bresch, the chief executive of Mylan, a giant maker of generic drugs based outside Pittsburgh.
Her company’s profits come largely from Medicaid and Medicare, which means her nest is feathered by U.S. taxpayers. On Monday, Bresch announced that Mylan will renounce its United States citizenship and instead become incorporated in the Netherlands – leaving this country, in part, to pay less in taxes.
This is the sort of story that makes blood boil in populists – voters from the Elizabeth Warren wing of the Democratic Party to libertarians who follow Rand Paul and including tea party conservatives. These disillusioned souls, growing in numbers, hate hypocrites who condemn the U.S. political system while gaming it.
Populists can’t be happy with how this story was told by Andrew Ross Sorkin of the New York Times. Under the headline “Reluctantly, Patriot Flees Homeland for Greener Tax Pastures,” Sorkin cast Bresch as a helpless victim of a system that has made her wealthy and her father powerful.
Heather Bresch grew up around politics. Her father is Joe Manchin, the Democratic senator from West Virginia and a former governor. She has heard him say repeatedly, “We live in the greatest country on Earth,” as he did in countless political advertisements. And it appeared to rub off on her: Ms. Bresch was named a “Patriot of the Year” in 2011 by Esquire magazine for helping to push through the F.D.A. Safety Innovation Act.
Ah, so she’s a patriot. Bresch told Sorkin that she engineered the company’s divorce from the United States “reluctantly,” and, the reporter added, “she genuinely seems to mean it.” That credulous line was followed by two paragraphs about corporate tax rates, an important reminder of how slowly political and business leaders are adapting to the global, tech-infused economy.
If Ms. Bresch’s deal is not a call to Washington to address what is clearly a growing trend that it has remained nearly silent on, the nation will most likely continue to lose large employers and taxpayers in droves to countries with lower tax rates. Almost 20 large United States companies have announced plans to give up their United States citizenship over the last two years. Just on Monday, the Irish drug maker Shire cleared the way for a merger with AbbVie, the drug maker based in Chicago, and Walgreen is considering an inversion through a deal with Alliance Boots, a European drugstore chain.
“It’s not like I’ve not been vocal and up there talking to anybody who’d listen to me,” Ms. Bresch told me in an interview about the crusade she had been on in Washington for years, talking to lawmakers about overhauling the corporate tax code to make United States companies more competitive. “But you know what they all say? ‘Yeah, uh huh, O.K. Uh huh.’ “
That’s ripe. The daughter of a U.S. senator and former governor – a Patriot of the Year, no less – says she got lip-service from Congress. Just like you and me.
To his credit, Sorkin says there is something “morally disconcerting” about a company bolting a country that is among its biggest customers. Still, he writes, Bresch “insists that the merger is being driven mostly by its strategic merits, and that the lower tax rate is just an added benefit.” OK, now. That’s hard to swallow. How much in taxes will she save by jilting the United States?
Ms. Bresch, who said the company’s current effective tax rate is about 25 percent, said the rate would come down to 21 percent in the first year of the deal and then move into the high teens after three to five years. Mylan will continue to pay taxes in the United States on its domestic profits, but not on its business operations abroad.
All of which raises an important question: Even if the United States were to revamp its corporate tax code, how low would the rate have to drop to be competitive and still raise enough revenue to pay for the services that citizens expect?
Corporate taxes will go as low as ordinary voters can stand it, no doubt, because their rates are determined by powerful special interests and elites like Bresch and her father. Manchin wouldn’t speak to me, but he did issue a nugatory statement to Sorkin – something about being “disappointed” when U.S. companies “feel the need to move overseas because of the U.S. tax code.”
Too bad Manchin isn’t in a postion to feel the need and find a way to keep Mylan paying taxes to the United States, the country that presumably will continue to enrich her firm via Medicare and Medicaid. Would he try to cut federal drug payments to Mylan by roughly the amount of taxes his daughter is taking to the Netherlands? I don’t know, because my call to the senator’s office was not returned.
As for Americans less privileged and powerful than these two characters, your role is clear: Just cast your votes and pay the bills.
Trouble is brewing in Washington as those who still consider legitimate the national healthcare takeover known as Obamacare try to figure out which enrollees are even eligible for coverage. A new report issued by the Office of the Inspector General (OIG) admits that nearly 1.3 million Obamacare enrollees, or about 16 percent of the overall total, cannot be verified for legal status in the U.S. – in other words, most, if not all, of them are illegal immigrants rather than American citizens.
The shocking figures can be found on page 11 of the Department of Health and Human Services (HHS) report, entitled Marketplaces Faced Early Challenges Resolving Inconsistencies with Applicant Data. According to the figures, 1,295,571 “inconsistencies” – this is a politically correct way of implying missing or fraudulent data – found on Obamacare applications involved issues of citizenship, national status or lawful presence in the U.S., meaning applicants did not or could not verify this important information.
“The Federal marketplace was generally incapable of resolving most inconsistencies,” admits the report, noting that a large percentage of these faulty applications will likely never be resolved, at least not until the eligibility verification system becomes operable. “Without the ability to resolve inconsistencies in an applicant’s eligibility data, the marketplace cannot ensure that an applicant meets each of the eligibility requirements for enrollment in a [Qualified Health Plan] and when applicable, eligibility for insurance affordability programs.”
Nearly Half Of Total Obamacare Enrollees Cannot Be Verified As Eligible
What this implies is that the entire Obamacare program is nothing but a giant free-for-all, with absolutely no checks or balances in place to ensure that abuse and fraud don’t run rampant. Between abnormalities with income, employment verification and legal status in the U.S., it appears as though the bulk of Obamacare enrollees are either criminals, deadbeats or illegal aliens who don’t even belong in the country.
Of the roughly 8 million applicants who have signed up for Obamacare as of this writing, nearly 3 million of them cannot be verified by the current system as eligible, according to the HHS. And at this point in time, there is no way to ever verify them, as admitted by the Inspector General, further proving the massive swindle that has been levied on the American people by the Usurper-in-Chief who, ironically, has his own eligibility inconsistencies.
Four State-Run Exchanges Admit They Have No Way Of Verifying If Obamacare Enrollees Are Legal Citizens
Beyond the federal debacle, at least four state-run Obamacare exchanges are also incapable of verifying applicant eligibility. The HHS report explains that four of the 15 state marketplaces – Massachusetts, Nevada, Oregon and Vermont – haven’t figure out a way to resolve their “inconsistencies,” either. Much of this is due to their enrollment systems never having been designed with the capacity to verify applicants, a major oversight (or, perhaps, a deliberate design flaw).
Three other states – Hawaii, Colorado and Minnesota – have also had problems with inconsistencies. But these states sloughed the mess onto their state Medicaid offices, which are now having to individually verify each application by hand.
“One year ago, conservatives warned that the Obama administration’s decision to use the so-called ‘honor system’ for income eligibility was merely a backdoor way to get as many individuals on the public dole as possible,” wrote Wynton Hall for Breitbart about the ongoing dilemma. “The Office of Inspector General determined that ‘the federal marketplace was generally incapable of resolving most inconsistencies.’”
For many, it is difficult to decide whether Barack Obama is intentionally trying to destroy the United States or that he is doing so as a consequence of some type of ideology-induced stupidity.
The damage wrought through the implementation of his absurd and impractical liberal “solutions” to national problems is readily evident.
When Barack Obama was inaugurated on January 20, 2009 the national debt of the United States was $10,626,877,048,913. As of Jun 26, 2014, the debt was $17,512,592,730,102.
According to the Bureau of Labor Statistics (BLS), in 2007 on the eve of the recession, there were 146.6 million Americans working. Today, after six years of the Obama Administration, there are 145.8 million Americans in jobs, 800,000 below the previous peak. Since Obama came into office in 2009, 7.2 million people have left the workforce, making the true unemployment rate 8.3 percent, not 6.1 percent. Median household income is down almost $2,300 from what it was when Obama took office. Real wages are lower than they were in 1999. Growth in the first quarter of this year was a negative 2.9%, the biggest downward revision from the agency’s second GDP estimate since records began in 1976.
In April, prior to the present massive and growing surge in illegal minor immigration, Sen. Jeff Sessions (R-Ala.) said Obama has created an “open borders” situation by failing to enforce U.S. immigration law. One could fairly conclude that the current crisis was a deliberate policy decision because the Obama indicated that he would expand Deferred Action for Childhood Arrivals (DACA), a program that offers amnesty for illegal immigrant children and provides an incentive for exactly the type of mass illegal invasion we are witnessing on our southern border.
There should be little doubt that Obama’s open borders policy is meant to fundamentally transform the country’s demographics, produce millions of additional Democratic voters and welfare recipients and permanently undermine the national security of the United States.
The ATF “Fast and Furious” scheme, likely designed to erode Second Amendment rights, allowed weapons from the U.S. to “walk” across the border into the hands of Mexican drug dealers. The ATF lost track of hundreds of firearms, many of which were used in crimes, including the December 2010 killing of Border Patrol Agent Brian Terry.
Obama’s IRS targeted his perceived political enemies, conservative and pro-Israel groups, prior to the 2012 election. Questions are being raised about why this occurred, who ordered it, whether there was any White House involvement and whether there was an initial effort to hide who knew about the targeting and when. Obama apparently lied when he told Fox News’ Bill O’Reilly that there was “not even a smidgen of corruption” in IRS activities.
The Obama administration knew about allegations of secret waiting lists at the Department of Veterans Affairs (VA) as early as 2010, although, on May 19, 2014, White House spokesman claimed Obama learned about the scandal only recently through press reports.
The unfolding sectarian violence in Iraq is just the latest crisis where the Obama administration seemingly has been caught off guard. From the Veterans Affairs scandal to Russia’s swift annexation of Crimea, news of the world somehow keeps taking Obama and his team by surprise. Or are they just lying to camouflage flawed or failed policies, which have harmed the United States?
The attack on our “consulate” in Benghazi on September 11, 2012 was perhaps the most egregious of Obama’s many foreign policy failures because four Americans needlessly died due to a failure to provide adequate protection both before and during the attack.
Obama falsely blamed an internet video as the cause of the attack to hide the truth: the resurgence of jihadists in Muslim Brotherhood-governed Egypt, the continuing demand for the Blind Sheikh’s release (which underscored the jihadists’ influence), and the very real danger that jihadists would attack the embassy (which demonstrated that al-Qaeda was anything but “decimated”).
It is likely that a clandestine operation supplying weapons through Turkey to the Syrian rebels was being run out of Benghazi. Efforts were made not to draw attention to what was happening there. That could explain why local militias were paid to provide security, why requests for increased security were denied and why the US military was either unprepared to respond or told not to do so.
A Benghazi cover-up may have also prevented a thorough examination of the possible passivity or complicity of the Egyptian Muslim Brotherhood government in the attacks in Cairo and Benghazi and the potentially dangerous consequences of arming Islamic factions in Syria over which the US has little control, where the weapons we supplied may someday be used against us.
It should be obvious that Obama lied about Benghazi, he lied about Obamacare, the IRS, the VA scandal and in countless other instances.
Nevertheless, the liberal media remain willfully ignorant, will not report the truth and continue to protect Obama, regardless of the costs to the country.
Obama will survive in office until public awareness of his administration’s treachery matches its level of incompetence and exceeds the media’s capacity to tolerate corruption.
Jimmy Carter made mistakes. Barack Obama, a creator of crises, practices deceit and the willful betrayal of trust.
It does matter whether the damage inflicted upon our country results from ineptitude or premeditation.
It is ideology-induced treachery.
By its own estimate, the government made about $100 billion in payments last year to people who may not have been entitled to receive them – tax credits to families that didn’t qualify, unemployment benefits to people who had jobs and medical payments for treatments that might not have been necessary.
Congressional investigators say the figure could be even higher.
The Obama administration has reduced the amount of improper payments since they peaked in 2010. Still, estimates from federal agencies show that some are wasting big money at a time when Congress is squeezing agency budgets and looking to save more.
“Nobody knows exactly how much taxpayer money is wasted through improper payments, but the federal government’s own astounding estimate is more than half a trillion dollars over the past five years,” said Rep. John Mica, R-Fla. “The fact is, improper payments are staggeringly high in programs designed to help those most in need – children, seniors and low-income families.”
Mica chairs the House Oversight subcommittee on government operations. The subcommittee is holding a hearing on improper payments Wednesday afternoon.
Each year, federal agencies are required to estimate the amount of improper payments they issue. They include overpayments, underpayments, payments to the wrong recipient and payments that were made without proper documentation.
Some improper payments are the result of fraud, while others are unintentional, caused by clerical errors or mistakes in awarding benefits without proper verification.
In 2013, federal agencies made $97 billion in overpayments, according to agency estimates. Underpayments totaled $9 billion.
The amount of improper payments has steadily dropped since 2010, when it peaked at $121 billion.
The Obama administration has stepped up efforts to measure improper payments, identify the cause and develop plans to reduce them, said Beth Cobert, deputy director of the White House budget office. Agencies recovered more than $22 billion in overpayments last year.
“We have strengthened accountability and transparency, saving the American people money while improving the fiscal responsibility of federal programs,” Cobert said in a statement ahead of Wednesday’s hearing. “We are pleased with this progress, but know that we have more work to do in this area.”
However, a new report by the Government Accountability Office questions the accuracy of agency estimates, suggesting that the real tally could be higher. The GAO is the investigative arm of Congress.
“The federal government is unable to determine the full extent to which improper payments occur and reasonably assure that appropriate actions are taken to reduce them,” Beryl H. Davis, director of financial management at the GAO, said in prepared testimony for Wednesday’s hearing.
Davis said some agencies don’t develop estimates for programs that could be susceptible to improper payments. For example, the Health and Human Services Department says it cannot force states to help it develop estimates for the cash welfare program known as Temporary Assistance for Needy Families. The program is administered by the states.
The largest sources of improper payments are government health care programs, according to agency estimates. Medicare’s various health insurance programs for older Americans accounted for $50 billion in improper payments in the 2013 budget year, far exceeding any other program.
Most of the payments were deemed improper because they were issued without proper documentation, said Shantanu Agrawal, a deputy administrator for the Centers for Medicare & Medicaid Services. In some cases, the paperwork didn’t verify that services were medically necessary.
“Payments deemed `improper’ under these circumstances tend to be the result of documentation and coding errors made by the provider as opposed to payments made for inappropriate claims,” Agrawal said in prepared testimony for Wednesday’s hearing.
Among other programs with large amounts of improper payments:
- The earned income tax credit, which provides payments to the working poor in the form of tax refunds. Last year, improper payments totaled $14.5 billion. That’s 24 percent of all payments under the program.
The EITC is one of the largest anti-poverty programs in the U.S., providing $60.3 billion in payments last year. Eligibility depends on income and family size, making it complicated to apply for the credit – and difficult to enforce, said IRS Commissioner John Koskinen.
“EITC eligibility depends on items that the IRS cannot readily verify through third-party information reporting, including marital status and the relationship and residency of children,” Koskinen told a House committee in May. “In addition, the eligible population for the EITC shifts by approximately one-third each year, making it difficult for the IRS to use prior-year data to assist in validating compliance.”
- Medicaid, the government health care program for the poor. Last year, improper payments totaled $14.4 billion.
Medicaid, which is run jointly by the federal government and the states, has seen a steady decline in improper payments since 2010, when they peaked at $23 billion.
The program is expanding under President Barack Obama’s health law.
- Unemployment insurance, a joint federal-state program that provides temporary benefits to laid-off workers. Amount of improper payments last year: $6.2 billion, or 9 percent of all payments.
The Labor Department said most overpayments went to people who continued to get benefits after returning to work, or who didn’t meet state requirements to look for work while they were unemployed. Others were ineligible for benefits because they voluntarily quit their jobs or were fired.
- Supplemental Security Income, a disability program for the poor run by the Social Security Administration. Amount of improper payments: $4.3 billion, or 8 percent of all payments.
Social Security’s much larger retirement and disability programs issued $2.4 billion in improper payments, according to agency estimates. Those programs provided more than $770 billion in benefits, so improper payments accounted for less than 1 percent.
It’s an Obama world.
The US military is spending as much as $150 per gallon of jet fuel from algal sources rather than $2.88 a gallon for conventional jet fuel.
The Washington Times reported:
Last month, a Government Accountability Office report found that the military was spending as much as $150 a gallon on alternative jet fuel derived from algal oil rather than $2.88 a gallon for conventional jet fuel.
“Why should the Defense Department be paying for solar panels? Why should defense be paying for biorefineries? Those are not defense items. We have a Department of Energy that’s supposed to be doing that stuff. The disarming of America is not just what he’s been doing in cuts or delays like the F-35s, but less obvious is what he’s puts in [the defense budget] that we’re spending money on that should be spent on defense as opposed to his agenda.
“Now, [the president’s] true to his agenda, and you may agree with it and that’s fine. I don’t,” Mr. Inhofe said.
Meanwhile, veterans are dying before they can get help from the VA.
The Keystone Pipeline project was expected to create tens of thousands of high paying jobs in the oil industry. The project itself would create 20,000 construction jobs. And the pipeline would bring oil from Canada and North Dakota to refineries in the United States.
The proposed project would have extended from Alberta, Canada to Illinois, transporting approximately 400,000 barrels of crude oil per day. Estimated cost is $1.7 billion.
Democrats are beholden to the radical green movement – the poor and middle class be damned.
Canada pulled the plug on Keystone and will send the oil to Asia.
Watts Up With That reported:
Obama’s inability to make a decision on Keystone has finally yielded a result – Canada has made the decision for him.
The Canadian oil will still be burnt – in Asia, instead of America.
All the jobs and energy security which Canadian oil could have delivered to America, will instead be delivered to Asia.
Rather than purchasing crude from a friendly and allied neighbor, the United States will most likely need to continue its reliance upon hostile sources like Venezuela.
Only a Democrat could make such a dangerous and irresponsible decision for the country.
Right to work laws have led to skyrocketing manufacturing growth in the auto industry, according to a new study.
The National Institute of Labors Relations Research, an employment policy think tank, found that the auto industry’s flight from coercive unionization has produced a boom in right to work states, such as Tennessee. The institute traced federal labor statistics from 2002 to 2010 and discovered a dramatic shift in where the nation’s cars are being built.
“Considering just the 22 states that had Right to Work laws from 2002 to 2012, the Right to Work share of nationwide automotive manufacturing output grew from 36% to 52% over the decade,” NILRR researcher Stan Greer wrote on the institute’s website. “Real manufacturing GDP in these 22 Right to Work states grew by 87% from 2002 to 2012, but fell by 2% in forced-unionism states.”
Foreign carmakers, such as Toyota, Honda, and Volkswagen have established factories in right to work states, as well as non-union shops in Kentucky. Additionally, Ford, GM, and Chrysler have shifted jobs and supplier contracts from forced unionization states to right to work states.
“As recently as 2002, just 21% of the total U.S. output in automotive manufacturing took place in Right to Work states,” Greer found.
That gap will likely widen when the U.S. Commerce Department’s Bureau of Economic Analysis release manufacturing data for 2013 later this year.
Michigan and Indiana, two of the largest automobile manufacturing hubs in the United States, became right to work states in 2012 and 2013, respectively. Those laws will allow autoworkers to opt out of the United Auto Workers when their current contracts expire, which could signal a steeper decline of the number of cars built by unionized workers.
Auto expert Ted Niedermeyer said that Big Labor’s dominance of the auto industry “is on its last legs.”
“The fact that the UAW has not responded well to competition explains why auto production in this country is only expanding in non-union states,” he said.
The UAW has been trying for many years to insinuate itself into a manufacturing facility in a right-to-work state in order to boost its sagging membership. The union had its best chance when it secured Volkswagen’s support to unionize a Chattanooga, Tenn., facility, Niedermeyer said. While management embraced unionization, workers soundly rejected the UAW in a February vote.
Patrick Semmens, a spokesman at the National Right to Work Committee, said that workers have witnessed the negative effects that come with union representation, as companies shift jobs out of traditional manufacturing sites. The fact that business is booming in union-free shops reminds workers of the potential downsides of unionization.
“The moral case for Right to Work as a means of protecting the individual rights and free choice of workers is strong enough all on its own. But time and time again we see that freedom for workers also benefits the economy of states that choose to protect worker choice and the booming auto industry in Right to Work states is just another example,” Semmens said.
Niedermeyer added that the rejection of the UAW in Tennessee is only the first sign of lagging support for unions among autoworkers.
“Beyond even the UAW’s rejection at the Chattanooga, Tenn., Volkswagen plant we are now seeing pro-union workers at the Mercedes plant in Vance, AL telling the UAW that their presence has been counterproductive,” he said. “The UAW-affiliated automakers have been shedding production capacity over the long term due to eroding market share, and are unlikely to add any significant amount of new production jobs in the US any time soon.”
These trends could play a central role as right to work laws are debated in Missouri and other states, according to NILRR’s Greer writes. Lawmakers should have to reconcile the impact that forced unionization could have on local economies.
“The overwhelming advantage Right to Work states have enjoyed over forced-unionism states in attracting automotive manufacturing investment ought to put the burden of proof on Big Labor legislators in forced-unionism states like Kentucky, Missouri and Ohio who claim it makes no difference to companies considering new plant construction or expansions whether unionism is voluntary or not,” he said.
From the Los Angeles Times:
Obamacare subsidies push cost of health law above projections
By Noam N. Levey | June 17, 2014
WASHINGTON – The large subsidies for health insurance that helped fuel the successful drive to sign up some 8 million Americans for coverage under the Affordable Care Act may push the cost of the law considerably above current projections, a new federal report indicates…
You don’t say.
That assistance helped lower premiums for consumers who bought health coverage on the federal marketplaces by 76% on average, according to the new report from the Department of Health and Human Services…
While the generous subsidies helped consumers, they also risk inflating the new health law’s price tag in its first year.
The report suggests that the federal government is on track to spend at least $11 billion on subsidies for consumers who bought health plans on marketplaces run by the federal government… If these state [exchange] consumers received roughly comparable government assistance for their insurance premiums, the total cost of subsidies could top $16.5 billion this year.
That would be far higher than projections this spring from the nonpartisan Congressional Budget Office that the 2014 subsidies would cost the federal government $10 billion…
Imagine them being so badly mistaken in their projections. How does it happen, time and again?
The Congressional Budget Office estimated in April that the annual cost of subsidies will rise to $23 billion next year and $95 billion in 2024, although the budget office continued to project that all the law’s costs will be offset by additional revenue it raises and by cuts in other federal healthcare spending.
Right. Just like the way Medicare costs have been offset over the years.
So Secretary Eric Shinseki is now ex-secretary Shinseki, and cleaning up the Department of Veterans Affairs’ health care mess will now be someone else’s job. But there’s a good chance that no matter who is in charge, the cleanup will be, basically, impossible. That’s because the VA is government health care.
Not all that long ago, some people were boosting the VA’s government-run nature as a plus. Writing in the Washington Post during the debate over Obamacare, Ezra Klein suggested that we should expand VA coverage to non-veterans, because the government just does health care better than the private sector: “Medicare is single-payer, but VA is actually socialized medicine, where the government owns the hospitals and employs the doctors… If you ordered America’s different health systems (from) worst-functioning to best, it would look like this: individual insurance market, employer-based insurance market, Medicare, Veterans Health Administration.”
A couple of years later, in 2011, Klein hailed the VA health system as an example of “when socialism works in America“: “The thing about the Veteran’s (Affairs’) health-care system? It’s socialized. Not single-payer. Not heavily centralized. Socialized. As in, it employs the doctors and nurses. Owns the hospitals… If I could choose my health-care reform, I don’t think I’d go as far towards government control as the VA does. But the program is one of the most remarkable success stories in American public policy, and it needs to be grappled with.”
Now that the VA has erupted in scandals involving phony wait lists, and people dying because of treatment delays, an audit reveals a “systemic lack of integrity” in the system. According to the auditors, “Information indicates that in some cases, pressures were placed on schedulers to utilize inappropriate practices in order to make waiting times appear more favorable.”
In other words, they cooked the books. And what’s more, they did it to ensure bigger “performance bonuses.” The performance may have been fake, but the bonuses were real. (One whistle-blower compared the operation to a “crime syndicate.”)
And that captures an important point. People sometimes think that government or “nonprofit” operations will be run more honestly than for-profit businesses because the businesses operate on the basis of “greed.” But, in fact, greed is a human characteristic that is present in any organization made up of humans. It’s all about incentives.
And, ironically, a for-profit medical system might actually offer employees less room for greed than a government system. That’s because VA patients were stuck with the VA. If wait times were long, they just had to wait, or do without care. In a free-market system, a provider whose wait times were too long would lose business, and even if the employees faked up the wait-time numbers, that loss of business would show up on the bottom line. That would lead top managers to act, or lose their jobs.
In the VA system, however, the losses didn’t show up on the bottom line because, well, there isn’t one. Instead, the losses were diffused among the many patients who went without care — visible to them, but not to the people who ran the agency, who relied on the cooked-books numbers from their bonus-seeking underlings.
And, contrary to what Klein suggests, that’s the problem with socialism. The absence of a bottom line doesn’t reduce greed and self-dealing – it removes a constraint on greed and self-dealing. And when that happens, ordinary people pay the price. Keep that in mind, when people suggest that free-market systems are somehow morally inferior to socialism.
We were warned…
In January 2008 Barack Obama told the San Francisco Chronicle:
“Under my plan of a cap and trade system electricity rates would necessarily skyrocket. Businesses would have to retrofit their operations. That will cost money. They will pass that cost onto consumers.”
He promised that his plan would cause electricity rates to skyrocket.
He wasn’t kidding.
On Monday the Obama administration unveiled the first-ever national limits on carbon emissions from existing power plants.
FOX News reported:
The Obama administration on Monday unveiled the first-ever national limits on carbon emissions from existing power plants, a controversial regulation aimed at fulfilling a key plank of President Obama’s climate change agenda.
The Environmental Protection Agency wants existing plants to cut pollution by 30 percent by 2030, under the plan.
The draft regulation sidesteps Congress, where Obama’s Democratic allies have failed to pass a so-called “cap-and-trade” plan to limit such emissions. The EPA plan will go into effect in June 2016, following a one-year comment period. States will then be responsible for executing the rule with some flexibility.
They are expected to be allowed to require power plants to make changes such as switching from coal to natural gas or enact other programs to reduce demand for electricity and produce more energy from renewable sources.
They also can set up pollution-trading markets as some states already have done to offer more flexibility in how plants cut emissions.
If a state refuses to create a plan, the EPA can make its own.
Obama’s energy policies will disproportionately harm the poor, middle class and minorities.
Real Clear Energy reported:
A study by Eugene M. Trisko for American Coalition for Clean Coal Electricity reviewed the disproportionate impact of higher energy costs on differing income groups from 2001 to 2011.
The study found that the amount of money spent on energy for half of American households that make less than $50,000 almost doubled rising from 12 percent in 2001 to 20 percent in 2011.
Minorities with lower average incomes than white households are disproportionately harmed by rising energy prices.
For example, in 2009, 67 percent of black households and 62 percent of Hispanic households had average incomes below $50,000 in contrast with only 46 percent of white households.
Since minority households have lower incomes than white households, rising energy prices will take a larger share of their family’s disposable income leaving fewer dollars for housing, medicine and clothes.
Obama’s refusal to approve the Keystone XL pipeline, new greenhouse gas regulations from the EPA and discussions of a carbon tax provides more evidence that Obama’s anti-fossil fuel agenda will force energy prices higher.
The economy shrunk by 1.0% in the first quarter. (Trading Economics)
The Obama administration originally blamed the record cold for the dismal economic growth rate… While at the same time pushing global warming junk science.
The GDP did not grow but contracted by 1% in the first quarter.
The Wall Street Journal reported:
The U.S. economy contracted in the first quarter of 2014, the latest stumble for a recovery that has struggled to find its footing since the recession ended almost five years ago.
Gross domestic product, the broadest measure of goods and services produced across the economy, contracted at a seasonally adjusted annual rate of 1.0% in the first three months of the year, the Commerce Department said Thursday. It was the first time economic output contracted since the first quarter of 2011, when it declined at a 1.3% pace.
Government economists had previously estimated GDP slowed to a 0.1% growth rate in the first quarter as harsh winter weather disrupted work sites, curtailed foot traffic at retail stores and snarled transportation networks across much of the U.S. The newly revised estimate incorporates additional economic data released in recent weeks. Higher-than-expected imports and slower-than-expected inventory growth dragged the economy into negative territory.
The Internal Revenue Service ruled it will impose a tax penalty on employers of up to $36,500 per worker for dumping employees into the Obamacare exchanges.
The New York Times, which broke the story, reports:
When employers provide coverage, their contributions, averaging more than $5,000 a year per employee, are not counted as taxable income to workers. But the Internal Revenue Service said employers could not meet their obligations under the health care law by simply reimbursing employees for some or all of their premium costs.
The IRS ruling is an effort by the Obama administration to stop employers with 50 or more workers from doing what critics of the health law said they would do: pay a penalty for not providing insurance and dump workers into the unpopular Obamacare program.
With the Nov. 4 midterm elections looming, the Obama administration could not allow massive waves of employer cancellations before Democrats face an already angry electorate. So the IRS ruled it would slap any employer with a $100 tax penalty per day per worker that used tax-exempt health insurance monies to cut workers a lump check and dump them on the Obamacare exchanges.
The new IRS rule comes on the heels of the Obama administration’s announcement that it will bail out insurers which participate in the Obamacare program which lose cash. As the Times notes, “Administration officials hope the payments will stabilize premiums and prevent rate increases that could embarrass Democrats in this year’s midterm elections.”
When a controlling shareholder in a corporation sells shares to the public, and the corporation subsequently discloses damaging information known to it at the time of the sale, the SEC normally gets to work investigating a possible crime. Withholding such data can be a crime, defrauding investors by withholding material information.
It would appear that something like that happened when the federal government sold GM shares to the public. In the private sector, it would be time to call in the criminal defense lawyers.
Writing at The Federalist, Sean Davis notes, “GM Sure Recalled A Lot Of Cars Right After The Feds Sold Their Shares”:
…at least GM acted as soon as it knew there was a problem. Because it’s not like the company would sit on the information and do nothing about it, right? Right?
Not so much.
GM knew about serious problems with the ignition switch for years, going back to at least 2007. At that time, GM had hard data from multiple crashes showing that some of its ignition switches had failed to function properly. The U.S. government officially bailed out the automaker in December of 2008. Throughout the five-year period of U.S. government ownership, nothing was done to address the deadly switch. According to one timeline of events, GM’s new CEO, Mary Barra, claims she did not even learn of the problem until December of 2013, which just so happens to be when the federal government sold its final shares of GM stock (at a loss of $10 billion, naturally).
Even though the company had data demonstrating a faulty ignition switch for years, it didn’t initiate a full investigation or recall until February of 2014, two months after the government sold its stake in the company. The National Highway Transportation Safety Administration (NHTSA) didn’t initiate a full investigation of the issue until later that month, even though the U.S. government had owned the company for 5 years. The Justice Dept. also showed up late to the party, confirming that same month that it had initiated a criminal probe into the matter.
The timing of claimed knowledge of the problems is so suspicious that a full scale criminal probe by the SEC is warranted. That would be the case if any private shareholder had sold shares under similar circumstances.
Law professor and Instapundit blogger Glenn Reynolds sarcastically remarks, “I’m sure the SEC will be right on this.”
But even if the SEC doesn’t take action, buyers of GM shares have a case to make in civil court, if they take a loss on the GM shares. In such cases, the doctrine that a CEO “should have known” the damaging information applies.
I can assure you that executives at Toyota and other foreign automobile manufacturers are noticing that Toyota was fined a record $1.2 billion for failing to disclose safety-related complaints relating to sudden acceleration, while GM was fined a paltry $35 million for failing to disclose safety-related complaints for ignition switch problems involving 2 million vehicles and fatalities. This looks a lot like a national government putting its thumb on the butcher’s scale to favor its own producers.
We have entered a phase of corporatism in the United States, with the government rigging the game for favored companies, it would appear. And in the world of corporate integrity, appearances are as important as reality.
The number of VA facilities under investigation after complaints about falsified records and treatment delays has more than doubled in recent days, the Office of Inspector General at the Veterans Affairs Department said late Tuesday.
A spokeswoman for the IG’s office said 26 facilities were being investigated nationwide. Acting Inspector General Richard Griffin told a Senate committee last week that at least 10 new allegations about manipulated waiting times and other problems had surfaced since reports of problems at the Phoenix VA hospital came to light last month.
The expanded investigations come as President Barack Obama’s choice to help carry out reforms at the Veterans Affairs Department was set to travel to Phoenix to meet with staff at the local VA office amid mounting pressure to overhaul the beleaguered agency.
Obama announced last week that White House Deputy Chief of Staff Rob Nabors would be assigned to the VA after allegations of delayed care that may have led to patient deaths and a cover-up by top administrators in Phoenix. Similar claims have been reported at VA facilities in Pennsylvania, Wyoming, Georgia, Missouri, Texas, Florida, and elsewhere.
Nabors met Tuesday in Washington with representatives of several veterans’ organizations, including the American Legion and Disabled American Veterans, among others. He will meet Thursday with leadership at the Phoenix Veterans Affairs Medical Center, including with interim director Steve Young, White House spokesman Jay Carney said.
Young took over in Phoenix after director Sharon Helman was placed on leave indefinitely while the VA’s Office of Inspector General investigates claims raised by several former VA employees that Phoenix administrators kept a secret list of patients waiting for appointments to hide delays in care.
Critics say Helman was motivated to conceal delays to collect a bonus of about $9,000 last year.
A former clinic director for the VA in Phoenix first came out publicly with the allegations of secret lists in April. Dr. Samuel Foote, who retired in December after nearly 25 years with the VA, says that up to 40 veterans may have died while awaiting treatment at the Phoenix hospital. Investigators say they have so far not linked any patient deaths in Phoenix to delayed care.
The allegations have sparked a firestorm on Capitol Hill and some calls for VA Secretary Eric Shinseki’s resignation. The VA’s undersecretary for health care, Robert Petzel, has since stepped down.
However, Republicans denounced the move as a hollow gesture, since Petzel had already been scheduled to retire soon. And several lawmakers are proposing legislation to take on VA problems.
Republican Sen. Jerry Moran of Kansas, a member of the Senate Veterans Affairs Committee, told The Associated Press on Tuesday he plans to introduce legislation this week to ensure that internal probes by the VA’s Office of Medical Inspector are released to Congress and the public “so the full scope of the VA’s dysfunction cannot be disguised.”
Moran noted that a VA nurse in Cheyenne, Wyoming, was put on leave this month for allegedly telling employees to falsify appointment records. The action came after an email about possible wait-list manipulation at the Cheyenne hospital was leaked to the media.
But Moran said the Cheyenne center was already the subject of a December 2013 report by Office of the Medical Inspector. That report apparently substantiated claims of improper scheduling practices, but it’s unclear if action taken at the Cheyenne center was based on the medical inspector’s findings, Moran said.
“Because OMI reports are not available to the public and have not been previously released to Congress, it is impossible to know whether the VA has taken action to implement the OMI’s recommendations for improvement in each case,” Moran said.
Meanwhile, two Republican senators introduced legislation to prohibit payment of bonuses to employees at the Veterans Health Administration through next year. Sens. Richard Burr of North Carolina and Deb Fischer of Nebraska said the VA should focus its spending on fixing problems at the agency, “not rewarding employees entrenched in a failing bureaucracy.” Burr is the senior Republican on the Senate Armed Services Committee and Fischer is a panel member.
The House passed a bill in February eliminating performance bonuses for the department’s senior executive staff through 2018.
Texas Sen. John Cornyn, the No. 2 Republican in the Senate, also called on Obama to back off plans to nominate Jeffrey Murawsky to replace Petzel at the VA. Murawsky, a career VA administrator, directly supervised Helman from 2010 to 2012.
The White House has said Obama remains confident in Shinseki’s leadership and is standing behind Murawsky’s nomination.
Shinseki and Defense Secretary Chuck Hagel met with the House Appropriations Committee on Tuesday to discuss how the two departments can improve interactions between their health records systems. The two Cabinet members said in a joint statement that the meeting was productive and that both men share the same goal – to improve health outcomes of active duty military, veterans and beneficiaries.
Sen. Roy Blunt (R., Mo.) issued a blistering condemnation of the Obama administration for their handling of various scandals Wednesday in a statement to the press.
Blunt said there seems to be an endemic aversion at the White House to take responsibility for any of the scandals currently facing the administration. The Missouri senator listed the VA scandal, Serco Obamacare workers apparently being paid to do nothing, and the State Department’s obliviousness to the case of Meriam Ibrahim as instances where the Obama administration is simply failing to take responsibility.
Blunt was particularly apoplectic about the State Department being unaware of his letter concerning Ibrahim despite having it for four days. “This is a woman, one of her sentences in Sudan is to be flogged for marrying a non-Muslim. And the second after they flog her is to hang her for refusing to renounce her Christian faith,” he said.
“We don’t seem to be concerned about that. She and her toddler son are in a prison cell right now waiting for the baby to be born so the mother can be killed. And nobody in our government appears to want to say anything about it.”
President Obama’s plan to require private insurance carriers to reimburse the Department of Veterans Affairs for the treatment of troops injured in service has infuriated veterans groups who say the government is morally obligated to pay for service-related medical care.
Calling it a “desperate search for money at any cost,” Craig Roberts, media relations manager for the American Legion, told FOXNews.com on Tuesday that the president will “wish away so much political capital on this issue” if he continues to insist on private coverage for service-related injuries.
Cmdr. David K. Rehbein of the American Legion, the nation’s largest veterans group, called the president’s plan to raise $540 million from private insurers unreasonable, unworkable and immoral.
“This reimbursement plan would be inconsistent with the mandate ‘to care for him who shall have borne the battle,’ given that the United States government sent members of the Armed Forces into harm’s way, and not private insurance companies,” Rehbein said late Monday after a meeting with the president and administration officials at the Veterans Affairs Department.
“I say again that The American Legion does not and will not support any plan that seeks to bill a veteran for treatment of a service-connected disability at the very agency that was created to treat the unique need of America’s veterans,” Rehbein said.
Roberts said that 11 veterans service organizations were told to come up with another plan if they didn’t like this one. The groups met on Monday with Obama, Chief of Staff Rahm Emanuel, Veterans Affairs Secretary Eric Shinseki and Office of Management and Budget defense spending chief Steven Kosiak.
“What we’ve been tasked with now is to raise this money through alternative means and we’re supposed to have a conference call in two or three days… with Rahm Emanuel. So the implication was… you guys come up with a better idea or this is what’s going to happen,” Roberts said.
A summary of the proposed budget says the president wants to increase funding for VA by $25 billion over five years, and bring more than 500,000 eligible veterans of modest income into the VA health care system by 2013.
However, White House spokesman Robert Gibbs said Tuesday that no plans have been enumerated yet about veterans health care.
“Let me not make the case for a decision that this administration hasn’t made yet regarding the final disposition or decision on third-party billing as it relates to service-related injuries,” he said.
“The veteran service organizations… can have confidence that the budget the president has proposed represents an historic increase in discretionary spending to take care of our wounded warriors, those that have been sent off to war, have protected our freedom, and have come back wounded,” Gibbs continued.
But Roberts said the president’s plan would increase premiums, make insurance unaffordable for veterans and impose a massive hardship on military families. It could also prevent small businesses from hiring veterans who have large health care needs, he said.
“The president’s avowed purpose in doing this is to, quote, ‘make the insurance companies pay their fair share,'” Roberts said. “It’s not the Blue Cross that puts soldiers in harm’s way, it’s the federal government.”
Roberts said that the American Legion would like the existing system to remain in place. Service-related injuries currently are treated and paid for by the government. The American Legion has proposed that Medicare reimburse the VA for the treatment of veterans.
He added that the argument about the government’s moral obligation to treat wounded soldiers, sailors and Marines fell on deaf ears during the meeting.
“The president deflected any discussion when it got into any moral issue here,” he said. “Any attempt to direct the conversation (to the moral discussion) was immediately deflected.”
Private insurance is separate for troops who need health care unrelated to their service. But Roberts noted that if a wounded warrior comes back and needs ongoing treatment, he or she could run up “to the max of the coverage in very short order,” leaving his family with nothing
Roberts added that how the plan would raise $540 million “is a great mystery and it seems to be an arbitrary number… The commander said it seemed like this phantom number.”
Monday’s meeting was preceded by a letter of protest earlier this month signed by Rehbein and the heads of 10 service organizations. It read that “there is simply no logical explanation” for the plan to bill veterans’ personal insurance “for care that the VA has a responsibility to provide.”
The letter called it “unconscionable” to shift the burden of the country’s “fiscal problems on the men and women who have already sacrificed a great deal for this country.” Rehbein testified to both the House and Senate Veterans’ Affairs Committees on those same points last week
Rep. Joe Garcia (D., Fla.) suggested “communism works” while discussing the U.S.-Mexico border and the amount of money and federal government jobs that are offered in border towns such as El Paso, Texas.
“The safest city in America is El Paso, Texas. It happens to be across the border from the most dangerous city in the America’s, which is Juarez. Right?” Garcia asked a Google Hangout participant.
“Two of the safest cities in America are on the border with Mexico. Of course, the reason is we’ve proved that communism works. If you give everybody a good government job, there is no crime,” Garcia said.
It should be noted that Rep. Garcia has had a rough two weeks. Last week, he was exposed for eating his own ear wax.
Employees of an Obamacare contractor in a fourth state have now stepped up to admit that they’re doing no work while being paid taxpayer dollars, according to Missouri’s KOLR.
Now Serco offices in Arkansas are being added to the list of states where Obamacare contractors are being paid to do nothing, including Missouri, Kansas and Oklahoma.
Serco is an Obamacare contractor being paid over $1 billion to process any paper Obamacare applications.
Anonymous workers, who wished not to be named to avoid retribution, told Chris Nagus of KMOV in Missouri that they don’t have enough work to fill their time and are required to stay on the clock after work hours.
One worker said that he processed just 40 Obamacare coverage applications over six months, a similar situation to the Missouri office. A Missouri Serco employee named Lavonne quit her job with the company over frustration at the lack of work.
“I think for the entire month of December I processed six applications and that was pretty good,” Lavonne previously told Nagus.
In the Rogers, Arkansas office, workers are required to be on the clock, getting paid, but aren’t allowed to do any work. One worker told Nagus that employees aren’t allowed to make any outbound calls after 9 p.m. – but are required to stay on the clock until midnight.
“So why even be there until midnight,” Nagus asked the anonymous employee.
“I don’t know,” the worker responded. “Good question.”
“So they make the calls stop at 9, so from 9 to midnight are the callers kind of bored?” Nagus asked.
“Yeah, there’s nothing going on,” the worker concluded. But the employees are required to stay for the entire shift.
Even worse, the Rogers, Arkansas office is still hiring.
Watch the video report here.
$72 million in taxpayer funds down the drain.
The board of the Silver State Health Insurance Exchange voted this morning to dump the contractor that botched the building of its Nevada Health Link website, and to move partly into the federal system for at least the next year.
The move would let the state exchange keep its autonomy and its member-based funding, and to allow the marketplace to switch to an operational website from another state for its 2016 enrollment period.
The change to a new system could cost as much as $57 million in addition to the $72 million contract the exchange already had with Xerox. But exchange officials said they’ve already applied for federal grants to cover the cost. Plus, the cost of buying another system may drop considerably by the time the exchange is ready to go forward in late 2015, state officials said.
Obamacare offers subsidies to help pay for health insurance – if you are buying insurance through the federal exchange and your income qualifies. But now the word is out that at least 1 million people are probably getting the wrong subsidy amounts.
The Washington Post has inside sources providing all sorts of juicy details on this problem – but it didn’t take an investigative reporter to predict this was going to happen.
Heritage expert Alyene Senger warned that Obamacare’s subsidies are tied to income – and if your income changes at any point during the year, your subsidy is supposed to change, too. She explained in January:
if a person’s income fluctuates, which happens more frequently than many realize, the subsidy amount will change from month to month. Thus, when it comes time to file taxes in April, the amount of subsidy received over the past year must be reconciled with the final calculation of the total subsidy for which the individual was eligible—based on actual income for the entire tax year.
So if you qualify for more subsidy help than you receive during the year, you’ll get a tax refund. But if you were given more subsidy than your income qualifies you for, you will be required to repay the excess subsidy.
Now, the Post reports that the government is attempting to keep up with this – except that the part of Obamacare’s computer system that is supposed to match proof of income with people’s Obamacare applications is, well, not built yet.
Since taxpayers are funding the subsidies, it’s important to make sure the correct amounts are going to the correct people, right? Well, that does make the Obama administration “sensitive” these days, the Post says:
Beyond their concerns regarding overpayments, members of the Obama administration are sensitive because they promised congressional Republicans during budget negotiations last year that a thorough income-verification system would be in place.
This setup is a disaster. And it will ensnare a lot of people. Senger pointed to one analysis estimating that nearly 38 percent of families eligible for subsidies also experience “large income increases” at some point during the year – meaning they would have to pay back some or all of their subsidies.
“The issue is symptomatic of many problems that will plague the law in coming years,” Senger said.
Is it any wonder that 60 percent of voters in a recent poll said the debate about Obamacare is not over? And 89 percent said Obamacare will affect their voting decisions this fall.
Louisiana Gov. Bobby Jindal is right – Obamacare is still not the answer for America’s health care needs. It’s time for Congress to look at patient-centered alternatives that would restore choice to American health care – and stop the unending tales of Obamacare disaster.
If you have an aging parent or other elderly relative who is currently hospitalized with chronic heart or lung disease, the good news is he is coming home. The bad news is that he is likely coming home to die. That’s thanks to a strong disincentive for hospitals to readmit chronically ill Medicare patients under a provision of Obamacare.
Called the Hospital Readmissions Reduction Program (Section 3025 of the Affordable Care Act added section 1886(q)), the provision took effect on October 1, 2012 and penalizes hospitals for readmitting patients with one of several high-maintenance conditions – heart failure, heart attack and pneumonia – within 30 days of discharge. Two additional expensive-to-manage illnesses, Chronic Obstructive Pulmonary Disease (COPD) and follow-up treatment for coronary bypass surgery, are scheduled to be phased in this year.
In the view of the Medicare Payment Advisory Commission (MPAC), readmission of Medicare patients with any of these illnesses is an admission – of failure on the part of doctors. The government believes that if the correct treatment were administered during an initial hospital stay, these patients wouldn’t need to return. As a corrective measure, the law imposes a hefty fine on hospitals that readmit chronically ill patients. MPAC estimates that the fines collected will ultimately restore $1 billion to Medicare’s depleted coffers.
Currently, one in five elderly patients is readmitted within the 30-day window. Many of the readmissions result from unanticipated changes in the patient’s condition or a planned follow-up treatment. But roughly 12% are caused by patient confusion over new drug regimens, inadequate follow-up with primary care physicians, or a family’s inability to deal with home care. These “avoidable readmissions,” the government insists, are the fault of hospital staffs for not doing a better job of educating patients and/or administering better preventive care.
There are two problems with the approach. One, spelled out in an article at the British medical journal The Lancet, is that some of these chronic diseases in the elderly are tricky to manage. “Frequent readmissions,” the authors note, “might simply reflect the nature of the patient population rather than poor health care.” They add:
A 30-day readmission rate might be a suitable measure of health-care delivery for some conditions or surgical procedures, but for patients with COPD a more sophisticated gauge of success that incorporates medical, social, functional, and economic elements is needed.
The other problem is how hospitals and doctors on staff respond to the penalty. The most likely scenario is that they will now become de facto agents for the law’s death panels, urging Medicare patients at their time of discharge to sign do-not-resuscitate orders and seek “comfort care” instead of future medical treatment.