Change We Can't Afford

On Tuesday, January 20, the world witnessed the Immaculate Inauguration of Barack Obama. With him as President, the country will get the change we need, in health care, economics, and the war on terror. But I'm not so sure it's change for the better.

Obama wants to see universal health care in the US. His appointed health czar, Tom Daschle, wrote a book describing a plan to create a Federal Health Board, much like the Federal Reserve, to oversee American health care. That means, like the Federal Reserve, this board would consist of private health care workers (insurance companies, doctors, etc.) with no government control. Not to mention, Daschle wants to merge employers' plans, Medicaid and Medicare with an expanded FEHBP (Federal Employee Health Benefits Program) that would cover everyone.

Universal health care is BAD.
#1. There isn't a single government agency or division that runs efficiently; do we really want an organization that developed the U.S. Tax Code handling something as complex as health care?

#2. "Free" health care isn't really free since we must pay for it with taxes; expenses for health care would have to be paid for with higher taxes or spending cuts in other areas such as defense, education, etc.

#3. Profit motives, competition, and individual ingenuity have always led to greater cost control and effectiveness, as well as better technology. Without it, the health care technological advances will diminish.

#4. Government-controlled health care would lead to a decrease in patient flexibility--ONLY if the government says you can receive care, will you get care.

#5. Patients aren't likely to curb their drug costs and doctor visits if health care is free; thus, total costs will be several times what they are now, making health care more expensive.

#6. Just because Americans are uninsured doesn't mean they can't receive health care; nonprofits and government-run hospitals provide services to those who don't have insurance, and it is illegal to refuse emergency medical service because of a lack of insurance.

#7. Government-mandated procedures will likely reduce doctor flexibility and lead to poor patient care. Kind of like what the government did to teachers: the government takes away their expertise and makes them follow rules, and pass tests, instead of allowing them to act as the professionals that they are, in other words: the dumbing down of America.

#8. Healthy people who take care of themselves will have to pay for the burden of those who smoke, are obese, have STDs, have more kids than they need, etc.

#9. A long, painful transition will have to take place involving lost insurance industry jobs, business closures, and new patient record creation.

#10. Loss of private practice options and possible reduced pay may dissuade many would-be doctors from pursuing the profession.

#11. Malpractice lawsuit costs, which are already sky-high, could further explode since universal care may expose the government to legal liability, and the possibility to sue someone with deep pockets usually invites more lawsuits.

#12. Government is more likely to pass additional restrictions or increase taxes on smoking, fast food, drinking soft drinks, eating candy, etc., leading to a further loss of personal freedoms.

#13. Like social security, any government benefit eventually is taken as a "right" by the public, meaning that it's politically near impossible to remove or curtail it later on when costs get out of control.

Lest us not forget the economy. Obama loves to harp on the "disappearance" of the working middle class, and openly states that only the wealthy have it good in America. Really? According to the Bureau of Labor Statistics, average hourly earnings of production and non-supervisory workers, adjusted for inflation, fell by 4 percent between 1975 and 2005. But those figures deceive because they omit fringe benefits like health insurance, pensions and paid leave, which make up a bigger share of total compensation than before. The numbers also rely on a mismeasure of inflation.

When those flaws are corrected, a very different trend leaps off the page. Median wages, says Fitzgerald, rose 28 percent between 1975 and 2005. Nor were the gains restricted to Bill Gates and Hannah Montana: Significant gains occurred in the middle as well.

The figures that suggest families are struggling to stay even overlook some types of income, and they don't account for the fact that households have gotten smaller on average. After accounting for such things, Fitzgerald found that "inflation-adjusted median household income for most household types increased by roughly 44 percent to 62 percent from 1976 to 2006."

Once again, kudos to American capitalism (the drive to make profits) for making life easier for Americans. The School of Gloom doesn't want you to know this, because then you wouldn't support things like an $800 BILLION dollar "stimulus package", which will nothing but create problems:

The $800 billion economic "stimulus" bill may be more appropriately called the "Obama debt plan." It will, after all, dump $6,700 per household of new debt into the laps of our children and grandchildren.

Whether it will actually stimulate the economy is another matter. So perhaps politicians can first answer a few questions from the back of the classroom:

1) President-elect Obama claims that spending approximately $800 billion will create 3.675 million new jobs. That comes to $217,000 per job. This doesn't sound like a very good value, especially with the national average salary around $40,000. Wouldn't it be cheaper to just mail each of these workers a $40,000 check?

2) Politicians say deficit spending will expand the economy (as if President Bush's $300 billion budget deficits brought economic nirvana). If that were true, then the current $1.2 trillion deficit — the largest in history — would already be rescuing the economy. It's obviously not. So why would $800 billion more of the same suddenly end the recession?

3) We're told that government spending will add new spending power to the economy. But Congress doesn't have a vault of money waiting to be distributed: Every dollar lawmakers "inject" into the economy must first be taxed or borrowed out of the economy. If government borrows the money from American investors, investment spending drops accordingly. If it's borrowed from foreigners, net exports drop accordingly. How does borrowing $800 billion from one group of people and giving that $800 billion to another group of people make us wealthier?

4) Some answer the previous question by saying that transferring income from savers to spenders keeps more money circulating through the economy. That made some sense in the 1930s when people hid their savings in mattresses because they didn't trust the banks. But today, people use their savings to pay down debt, invest, or put it in banks — in each case, making the purchasing power available to others wishing to borrow. Thus, savings circulate through the investment spending side of the economy. How does transferring money out of investment help?

5) Policymakers are basing the "stimulus" bill on economic models that wrongly assume every $1 of government spending increases the economy by approximately $1.60. Is it really that simple? By that logic, debt-ridden, big-government countries like Italy, France, and Germany should be wealthier than America. And why stop at $800 billion? Such logic suggests unlimited prosperity could be guaranteed by the government borrowing and spending $800 trillion. Should America be basing such costly decisions on these types of economic models?

6) Lawmakers tell us every $1 billion in highway "stimulus" can be spent creating 34,779 new construction jobs. But Congress must first borrow that $1 billion out of the private economy. Won't the private sector then lose the same number of jobs?

7) During the 1930s, New Deal lawmakers doubled federal spending — and unemployment remained above 20 percent until World War II. More recently, Japan responded to a 1990 recession by passing 10 "stimulus" bills over 8 years (building the largest national debt in the industrialized world) — and their economy remained stagnant. Why do lawmakers believe the same failed approach will succeed for the U.S. today?

8) The economy sank because people over-borrowed for houses they couldn't afford, and financial institutions over-borrowed for investments they badly misjudged. Washington's solution is to borrow $800 billion that it cannot afford. How will adding $800 billion to the national debt (which will also raise interest rates) solve a recession created by imprudent borrowing? And who will bail out the American taxpayer when the bill comes due?

9) Temporary tax rebates were implemented in 1975, 2001, and 2008, and most economists agree they failed to help the economy. Long-term marginal tax rate reductions implemented in 1982 and 2003 both substantially increased economic growth. So why are lawmakers planning another round of temporary tax rebates, followed by an increase in tax rates?

10) Mayors have pledged to spend stimulus funds on items such as a mob museum in Nevada, a polar bear exhibit in Rhode Island, and curbing prostitution in Dayton, Ohio. As National Review asked, how come one Bridge to Nowhere is a national embarrassment and 1,000 Bridges to Nowhere are a "stimulus?" Given the 11,000 annual earmarks, why should taxpayers trust politicians to spend this money better than they would spend it themselves?

Now the War on Terror. Obama has pledged to close Guantanamo, leave Iraq, and forge peace in Afghanistan. Closing Guantanamo, means finding other countries to take in released prisoners, who are dangerous to the US. This translates to American involvement/surveillance of any country that takes in a released Guantanamo prisoner. No country wants to do that, not to mention, these prisoners have been held for almost 8 years, without a trial. There is no evidence against these "terrorists", therefore we should let them go without any further ado.

Leaving Iraq sounds noble, but I guarantee you by July, we will send in more troops. Or Iran might act up, and we'll send in troops there. Same with Afghanistan, I bet Pakistan is where we send in troops. Point being: the War on Terror will never end, and there will always be a reason why our troops and bases must be sent and maintained overseas. The reasons being: oil, cheap labor, and drug trade--but of course the American public will hear the noble "we need to spread democracy" argument because the "extremists want all Christians dead". It's an historical repeat of the Crusades.