health care reform

Professors Give Failing Marks to Democrats Financial Reform Bill

College students know better than anyone the importance of listening to your professor. OK, given that most of us have laptops and iPhones, maybe we’re the last people you should ask. But still, what the professor says can sometimes be the difference between an A and a C. Recently some academics got together to grade the Democrats’s financial reform legislation. Their final marks? Well, let’s just say, it looks like the bill could be another low grade on an already poor report card.

Whereas a low grade for a college student may mean taking some easier courses to pull up the GPA, for the Democrats’ reform legislation, it could mean that the nation could lapse into another major crisis. As the New York Times reports,

As Democrats close in on their goal of overhauling the nation’s financial regulations, several prominent experts say that the legislation does not even address the right problems, leaving the financial system vulnerable to another major crisis.

Some point to specific issues left largely untouched, like the instability of capital markets that provide money for lenders, or the government’s role in the housing market, including the future of the housing finance companies Fannie Mae and Freddie Mac.

Others simply argue that it is premature to pass sweeping legislation while so much about the crisis remains unclear and so many inquiries are in progress.

“Until we understand what the causes were, we may be implementing ineffective and even counterproductive reforms,” said Andrew W. Lo, a finance professor at the Massachusetts Institute of Technology. “I understand the need for action. I understand the need for something to be done. But what I expect from political leaders is for them to demonstrate leadership in telling the public that we need to proceed about this in a much more deliberate and rational and thoughtful way.”

The problem is that patience has gone out the window. Democrats have taken a kamikaze approach to passing their agenda – introduce an idea, pump out a few positive sounding (if ultimately misleading) talking points, rush it through Congress using their big majorities, and then run an election strategy around “look how much we accomplished.”

Health care is the primary example. Democrats sensed a winning political issue that would appeal to everyone incensed by ever increasing health care premiums. They then trumped up their bill’s ability to bend the cost curve downwards, preserve Medicare, and change the way medicine is delivered. The bill zoomed through the House before anyone knew what happened and then faced a hard fought battle in the Senate before ultimately being passed using reconciliation. But as Nancy Pelosi now (in)famously said “we have to pass the bill so that you can find out what is in it.” She turned out to be exactly right. After passage we found out that companies were going to have to pay billions to comply with the new laws provisions, we found out from the Center for Medicare and Medicaid Services that the bill was actually going to increase the cost of health care more than if we had done nothing, and we found out from the CBO that many hospitals would stop treating Medicare patients if the planned cuts were imposed.

Unwilling to learn from their mistakes, Democrats are now taking the same pedal-to-the-metal approach to passing financial regulatory reform. The results will be just as flawed. For instance, consider the concerns of these professors, as compiled by the New York Times:

  • Andrew W. Lo, a finance professor at the Massachusetts Institute of Technology says that “until we understand what the causes were, we may be implementing ineffectiveand even counterproductive reforms.”
  • Gary B. Gorton, a finance professor at Yale, said the financial system would remain vulnerable to panics because the legislation would not improve the reliability of the markets where lenders get money . . . “It is unfortunate if we end up repeating history,” Professor Gorton said. “It’s basically tragic that we can’t understand the importance of this issue.”
  • David A. Skeel Jr., a corporate law professor at the University of Pennsylvania, said it would be a mistake for Congress to leave the drafting of these standards to the discretion of regulators.
  • Lawrence J. White, a finance professor at New York University, said it made no sense to overhaul financial regulation without addressing the future of federal housing policy. He said he was trying to find the strongest possible words to describe the omission of Fannie Mae and Freddie Mac from the legislation.“It’s outrageous,” he finally said.

It is important to get something done, but it is more important to get it right. Democrats want to claim that they are “the party of results,” but if those results don’t lower health care costs or prevent another financial collapse, what do they really have to show? The problem is that they see the trouble that lies ahead in November. Facing down the barrel of a brutal election season has led Democrats to make some bad decisions in the name of trying to find something (anything) to run on. The public wants real reform. They don’t want a slapdash mixture of provisions that fails to address the underlying problems that led to the reform conversations in the first place.

Democrats seem determined to push this flawed financial reform bill despite its failing marks from professors. If the reforms wouldn’t pass in college, Democrats shouldn’t let it pass through Congress.

by Brandon Greife, Political Director of the College Republican National Committee

Hate to Say We Told You So: New CMS Report Shows “Reform” Raises Costs

I hate to say we told you so. Really…we hate it. The first comprehensive report of the recently passed health care law was unveiled today. The study, done by the Center for Medicare and Medicaid Services (CMS), shows that many Republican criticisms of the health care law are likely to become reality.

We told you so. Representative Paul Ryan said

“Cost containment underpins the entire argument for reform. You’ve all been assuring us: ‘This plan will slow the growth of health care costs for our families, our businesses, and our government.’ Here again – the substance falls short of the rhetoric.”

The public agreed with Ryan. A Rasmussen poll taken directly before the health care reform vote found that 57% of voters believed that the costs of health care would go up while only 17% believe costs would go down if Democrats’ reform passed.

The CMS report showed these fears were not unfounded. The economic experts at the Health and Human Services Department found that the new reforms will do little to curb the runaway health care costs. In fact, they argue that it will bend the cost curve up, raising baseline spending by 1% over 10 years. The report states that,

“In aggregate, we estimate that for calendar years 2010 through 2019, [national health expenditures] would increase by $311 billion, or 0.9 percent, over the updates baselines projection that was released on June 29, 2009.”

CMS admits that even this figure may be more generous than the reality due to some unrealistic cuts being made to Medicare. Again, we told ya so. Senate Minority Leader Mitch McConnell repeatedly said that

“Medicare is already in trouble. The program needs to be fixed, not raided to create another new government program.”

According to the new report we were right. CMS says that cuts to Medicare could drive 15% of hospitals into the red and thus possibly lower the quality of care for Medicare beneficiaries.

“Over time, a sustained reduction in payment updates…would cause Medicare payment rates to grow more slowly than…the provides cost of furnishing services to beneficiaries. Thus, providers…could find it difficult to remain profitable and, absent legislative intervention, might end their participation in the program (possibly jeopardizing access to care for beneficiaries.”

Cutting access to Medicare would be political suicide. The government will be unwilling to accept this reality and will be forced to act to restore Medicare payment rates. But by doing so the Democrats’ claim that the reforms actually reduce the deficit would fall by the wayside.

The question everyone should be asking is why we are only hearing about this now. Before the bill was passed Democrats knew that the CMS was going to release a report analyzing the costs of the bill. At the time the CMS lamented that under the “very tight time frame” and due to the “complexity” of the reform legislation they would not be able to analyze the costs before the House voted on the legislation.

Instead, Democrats touted the score by the nonpartisan Congressional Budget Office as showing everything they needed to know before a vote was taken. Unfortunately for democracy, the CBO score was gamed. Unlike the CMS report the CBO is not a neutral calculator of costs. The CBO was forced to use unrealistic assumptions in determining the cost of the legislation, a constraint not shared by the CMS. It is little wonder then that today’s report provides a much less flattering picture; one that actually increases health care costs and decreases the quality of care.

We told you so. But we take no satisfaction in saying it. The sad reality is that this bill was sold to America based on faulty numbers. It was forced upon taxpayers without a full understanding of what it would truly cost. Democrats could have delayed the vote. With trillions of dollars in taxpayer money at stake they should have delayed the vote. Whether they didn’t do so because they wanted the debate to be over, or worse, because they expected the CMS report would show their savings claims were false, the victim is the American people. Regardless of whether Democrats’ motivations were naïve or insidious they must pay the price in November. We may be stuck with an overpriced health care reform package, but we aren’t stuck with Democratic majorities.

by Brandon Greife, Political Director of the College Republican National Commitee

Read more:

The True Costs of Student Loan Reform

Shhh. Be vewy, vewy quiet. I’m hunting refowm.

Perhaps you haven’t heard of the new student loan plan. It was a mere footnote tacked onto the health care bill in order to make the overall CBO score more palatable. Just because little was said does not mean little was done. In fact it represents a complete overhaul of the student loan industry – removing private and nonprofit lenders and replacing them with a sole originator and servicer – the federal government.

In theory student loan reform makes sense. The current system makes an adulterated mess out of free market principles. The problem began in 1993 when the federal government first got involved in offering student loans by creating the Direct Loan program to “compete” with private lenders. Unsurprisingly, when competing with someone who doesn’t face the same market pressures, private lender profit margins suffered and they raised their interest rates to compensate. The federal government, who deserves praise for their desire to keep loans affordable for students, stepped in and mandated a low interest rate.  The government, realizing that it may have just killed an industry, they began subsidizing private lenders so that they could maintain affordable loans without going under.

The Frankenstein-ish system doesn’t make much sense. Subsidizing businesses should not be the business of government. That said, is originating student loans really the business of government either? Senator Mitch McConnell recently lamented the government’s expansion into traditionally private sectors saying,

“we have the government running banks, insurance companies, car companies, health care and now the student loan business.”

Certainly there are some positives for young adults. The law allows for lower monthly caps on student loan payments – down to 10% of discretionary income. It also shortens the forgiveness period to 20 years after which the balance may be forgiven.

That said the bill is not all rainbows and butterflies. The initial CBO projection that the student loan reform bill would save $62 billion was recently downgraded after a more “comprehensive” assessment. The new CBO score explains that the original figure was determined using a procedure specified by the Federal Credit Reform Act of 1990. However, “estimates made under the FCRA do not provide a comprehensive measure of the cost to taxpayers of the federal student loan program” because it doesn’t include factor in “certain risks involved in lending” or “administrative expenses.” When scored under this “fair value basis” the CBOconcludes that:

“CBO recently estimated that whereas loans issued in the direct loan program between 2010 and 2020 would reduce the deficit by a total of $68 billion under FCRA accounting, those loans would increase the deficit by $52 billion on a fair value basis . . . The savings from implements the President’s proposals . . . decline from a total of $62 billion . . . to $40 billion.”

Moreover, the debate on savings has overshadowed the fact that the planned reforms still add to the deficit. As the CBO explains,

“Whereas on average over the 2010-2020 period a representative loan issues in the direct loan program has a negative subsidy rate of 9 percent under FCRA (meaning that it reduces the deficit), the same loan has a positive subsidy rate of 12 percent on a fair value basis.”

So while the reform may (if many of the CBOs assumptions prove true) reduce the deficit compared to the current broken system of a private-public hybrid, that is not the same thing as saying it will actually end up in the black. In other words, we’re just making something less awful…maybe. I say maybe because the government’s track record on staying on budget is shaky at best. Fannie Mae and Freddie Mac, as government-sponsored housing finance giants, may be the closest analogue to the government’s involvement in ensuring affordable student loans. Together these two firms have burned through $125 billion in taxpayer money and the CBO now predicts that the final price tag may exceed $380 billion.

Students will one day be taxpayers. As taxpayers they will be required to fund the liabilities of their government. So while a lower cap on payments sounds great in the short term we may be asked to make up for that plus interest in taxes to pay down our national debt. Perhaps this is why a new Rasmussen poll shows that only 35% like the new student loan plan while 49% think it is a bad idea.

True reform would have removed the government from the process, not gotten them more deeply involved. As with health care reform, we should have worked to make the student loan market more like a free market in that it is price sensitive. When government first got involved, by creating the Direct Loan program, it distorted the market, eliminated competition, and hid the price of an education from consumers. The new reforms will only worsen these problems with the likely effect being that colleges will capitalize through higher tuition and costs. After all, if the student, having been removed from the responsibility of costs, is not concerned with tuition price in their college decisions, there is very little incentive for colleges to compete for lower tuition.

The government snuck one by the American public. While health care reform was on the main stage nobody bothered to see what else was behind the curtain. The few words that were spoken made it seem impossible to like – after all who doesn’t want to save hard-working, Ramen-eating, college students some money. But this covers up the scary reality…we’ll be paying for this one way or another.

by Brandon Greife, Political Director of the College Republican National Committee

Some Thoughts on Change, Large and Small

There is nothing new about one’s political opponent’s trying to define your philosophy. This is a part of politics as old as the republic, and the more stinking and fearsome you can define how your enemy thinks, the more hay you will make with the electorate.

It worked so well for movement conservatives that they have chased the designation “liberal” from public discourse, perhaps for all time, by demonizing, exaggerating, and ultimately condemning those who identified themselves thusly as less than patriotic, less than American.

And previous to that, liberals worked wonders with the word “conservative” as they branded anyone of that philosophical bent a frothing at the mouth anti-Communist, a danger to American liberties, an ignorant, unlearned rube distrustful of intellectuals, and a mossback who looked with suspicion on international entanglements.

So goes the unending war between the two great philosophies – the yin and yang of the soul of America, forever condemned to be at odds while the country would find it impossible to do without both.

The complementary forces at work that make both liberals and conservatives necessary for a healthy society far exceed the puny efforts to rip asunder the the soul of America where these philosophies reside. While we have seen in recent decades an excessive partisanship that seeks dominance and control over the mechanism of government, what has been happening beneath the surface hasn’t changed; the slow, grinding forces of history that shape the destiny of America in ways we can only understand when we remove ourselves from the present political skirmishes and see the contours revealed by looking over our shoulder at what we have become.

American history is not a straight line proposition. It is tempting for narrative historians to paint it that way, but by doing so, much is missed in the translation. And the reason that is basically true is because of how America changes over the years, and the nature of change itself.

Generally speaking, America is a nation created to embrace change. Our Constitution has codified this notion by including the radical idea that future circumstances may require that the founding document be amended. But at the same time – and this is the key – the founders made it damn near impossible to alter their masterpiece. The Constitutional amendment must be passed by a 2/3 vote Congress and then approved by 3/4 of the states. A tall order that, as evidenced by the fact that, excluding the Bill of Rights, we have altered the text of our founding document only 17 times in 221 years.

Clearly, the founders wanted a little built in prudence to govern the engine of change. There is nothing wrong with that, as any conservative could tell you. Prudence is perhaps the most important civic virtue to which a society and by extension, government can aspire. It allows for change without overturning society in a helter skelter effort to address the issue of the day, putting a break on passion and forcing the citizenry to deal with what needs to be done in a rational manner. Change should be managed and well considered with a sharp eye directed toward consequences both seen and perhaps unseen.

This has usually been the case in America. And when it hasn’t been so, the worst consequences have usually been outweighed by the gains we have made by marching into the future with little or no idea of where we were going. Only the fact that we were moving ahead seemed to matter.

You can pick your own examples from history but I like the radical change found in Jacksonian democracy overturning the established order and giving ordinary people power they were previously denied. The “Age of the Common Man” had begun and since then, politicians have pandered to that notion of the “ordinary American,” sometimes masking schemes that accomplished exactly the opposite by claiming solidarity with regular folk.

Thinking of what has been done by government in the name of the “Middle Class” is to contemplate the unforeseen consequences that Old Hickory unleashed. And yet, we certainly wouldn’t trade what we have with what the Jacksonians defeated; the idea that there was a landed aristocracy who should rule by birthright.

In a similar fashion, we welcome the effects of destroying slavery even with the monumentally awful consequences of war, bitterness, divisiveness, and the system of Jim Crow that replaced bondage because slavery was such a fundamental evil that the unforeseen consequences didn’t matter. It could be said that in the case of getting rid of involuntary servitude and flushing it forever from the Constitution, that we could well say to hell with prudence, the actions we’re taking are long past due.

There are other examples of great change leading to unforeseen and deleterious consequences. Think of the Great Depression and the revolution in government begun by FDR. Until that time, the only contact people had with Washington was basically through the post office, or the draft. FDR changed that forever by initiating a massive government intervention in the economy in order to “save capitalism” while ordinary people were helped via government assistance with jobs, food, and housing. By today’s standards, these changes were modest indeed. But whether you are a liberal or conservative, you have to agree that there were unintended consequences to these changes and that not all of them were good.

Think of World War II and the rise of the national security state, the baby boom, the creation of a consumer driven economy – all changes that have good and bad consequences for our society, most of them unforeseen. War seems to accelerate change whether we want it or not which is a consequence in and of itself. How different we would be if we had not been drawn into the conflict? Alternate history parlor games notwithstanding, it would be impossible to say.

This brings us to the present and our president’s charge that opponents of his health insurance reform plan failed to embrace it because of their fear of change. There is something to that idea, although I would strenuously argue that for many on the right, it was not a question of being fearful of change per se, only the imprudent, unforeseen, uncontemplated changes inherent in a 3000 page bill few had read, fewer still understood, and no one could imagine the worst of what this effort at comprehensive reform of 1/6 the economy would mean.

Russel Kirk may be talking about conservative philosophy here, but I think he speaks to prudent people everywhere:

Any public measure ought to be judged by its probable long-run consequences, not merely by temporary advantage or popularity. Liberals and radicals, the conservative says, are imprudent: for they dash at their objectives without giving much heed to the risk of new abuses worse than the evils they hope to sweep away. As John Randolph of Roanoke put it, Providence moves slowly, but the devil always hurries. Human society being complex, remedies cannot be simple if they are to be efficacious. The conservative declares that he acts only after sufficient reflection, having weighed the consequences. Sudden and slashing reforms are as perilous as sudden and slashing surgery.

It’s almost as if the old professor had health insurance reform in mind when he wrote those words more than 50 years ago. The difference here between “real conservatives” (Kirk) and “true conservatives” (Palin) is probably lost on the partisans from both sides. But there is a universality to what Kirk is saying that strays beyond ideology and speaks to something far more important; our innate common sense.

President Obama has made a passionate case for health insurance reform. Indeed, many on the left have declared America deficient because we refuse to follow the lead of our European betters and embrace government run health care. I don’t doubt for a minute their sincerity in believing what the Democrats hath wrought on health care reform isn’t good and necessary, although I would gently point out that our founders went about writing a Constitution that put as much distance as possible between us and their ancestors across the sea.

I do question their common sense and prudence in advancing legislation that so many don’t want, and so many have pointed out potential disastrous consequences. Given that all change brings with it these unforeseen happenstances, and that the bigger the change, the more potential for catastrophe, one can only conclude that this kind of massive reform of the entire health care system was unnecessary and imprudent.

Change for the sake of change is mindless idiocy. Change because we are unique, and altering our society to conform to someone else’s idea of what is proper is nonsensical. There must be purpose, logic, and reason to change or you allow passion to govern. And if that be the case, you not only lack prudence, but judgment as well.

The American people would have embraced a far less ambitious, less costly, more tailored reform effort. We could have insured the uninsured and made insurance available to those denied it because of a pre-existing condition. We could have placed the hand of regulation less heavily on insurance companies while forcing them to conform to better standards, with more consumer protection. We could have done all of this and then carefully weighed the consequences before proceeding further.

But we didn’t. And the unforeseen consequences of this imprudent alteration in our health care system may far outweigh any good done in the passing of it.

Not just the Party of 'No'

Mitch Daniels makes some excellent points and suggestions for health care reform....

Congress could have done what Republicans should suggest now: Shift to a system that allows individuals—not businesses—to buy health insurance tax free. They could also create tax credits for buying health insurance based on income and health status to guarantee everyone coverage and encourage medical care and insurance competition. Republicans should push to lower barriers for buying insurance across state lines, create incentives for states to repeal mandates, and limit frivolous lawsuits that increase the price of insurance.

I like it.  All politics aside, the problem is that this bill serves the notion that insurers are to blame for high costs, and therefore are the ones to blame for being unaffordable for the 32 million without health insurance.  In reality, health insurance costs are a result of high medical costs.  Consumers buy insurance to protect themselves in case something happens to them.  If the original costs of medical services weren't so expensive to begin with, perhaps insurance costs wouldn't be so high.

This bill doesn't cut medical costs, it just penalizes health insurance companies.  With that in mind, I have a hard time believing that this will do anything but have an adverse effect on our economy and our health care industry.

I guess time will tell.

Did Evan Bayh Brad Ellsworth's HCR vote?

IN Democrat Brad Ellsworth, an ostensibly "conservative" Blue Dog Democrat, opposed the health care bill in November.

Sunday, he was one of the handful of Democrats who switched their vote to yes, providing the decisive margin for passage.


Money talks

Sen. Evan Bayh (D) announced today that he has contributed $1M of his campaign cash to help Rep. Brad Ellsworth (D-IN) succeed him in the Senate. The reward comes just a couple of days after Ellsworth suddenly and unexpectedly announced that he was voting "yes" on the Senate bill.  

I've seen Ellsworth running web ads suggesting we need to elect a "sheriff to the senate" (he had been Sheriff in Evansville before going Washington). Maybe it's time the IN AG, or hmmm. some sheriff, convene a grand jury and depose some witnesses to find out if the old Sheriff is now on the take? It's been atributed to a NH waitress that if the health care bill was any good, people didn;t need to be bribed to vote for it. We've found this bribe. I'm sure there's more where this came from.  And Evan, that's your reputationfor rectititude you smell burning about now 


The Republican Health Care Failure

Much ink and many pixels are being expended on writing health care's political postmortems, but the focus should rightly be on the policy front -- in the think tanks and in the legislative priorities of recent Republican administrations and Congresses. In short, the battle was lost before the first shot was even fired because Republicans did not present a compelling alternative story of what was wrong with the health care system, or how they would fix it. 

When it comes to health care policy, conservatives have been seriously outgunned. And I say this in all fairness to the friends I have who work night and day on free market solutions to health care. On economics, you always know what the conservative answer is: tax cuts and generally hands-off regulatory policies to spur economic growth. No matter how good the Democrats' promises sound, we return to these simple, pro-growth touchtones that resonate with a majority of Americans who intuitively get that you can't micromanage your way to a better future. 

On health care, I have no idea what our basic guiding principle is. Seriously, I don't. 

We have tried ineffectively to stretch free market rhetoric to health care without appreciating that health care is already too far removed from a free market for the analogy to make sense. Real markets are sensitive to price. Health care isn't. The insurance companies hide the cost of actual care from the consumer. 

What we have lacked in this debate is a simple clarion call to address an aching need -- bringing free market principles to bear to improve tangible health outcomes.

Instead, we have allowed the left to define the problem as exclusively one of access -- of the nearly 50 million without insurance dying in the streets (of course, we don't talk about that number anymore because nearly a third of that number are illegal immigrants, an issue Obamacare studiously avoids). 

And it's no surprise. The left has had a far greater number of health care analysts devising grand plans for the eventual takeover. And they have invested more political capital in this issue than any other. It should surprise no one that the conservative effort in this space has been paltry in comparison. We just haven't had as many people thinking about health care, and we didn't actively move legislation on it when we were in power. 

Perhaps you might say that's beside the point of the awfulness of this plan, and that our full efforts must go towards repeal. Be that as it may, Republican inattention to health care and the failure to develop a compelling free market narrative on the issue led to the place we are now. By pounding home the notion that the uninsured were the central problem with the health care system, and pointing to the fact that their numbers were growing each and every year, liberals built a sense of urgency that conservatives didn't have and were able to demand action -- even if that action was political suicide. 

At the outset of his Administration, George W. Bush set out to neutralize a key Democratic issue, education, with his No Child Left Behind Act. NCLB was a grab bag and not beloved by conservatives for its massive expansion in Federal spending in education, but it did insist on the vaguely conservative principle of accountability. 

The merits of that legislation can continue to be debated, but one political outcome is clear. We don't talk much about education at the federal level these days. There is a sense that the problem was "solved" by NCLB, which is now nearly a decade old. Likewise, no one will try to move welfare reform legislation because the successful 1996 reform law substantively and politically took the wind out of the sails of that issue. 

Imagine if instead of the Medicare Part D entitlement, the Bush administration had moved a smart, substantive health care bill that addressed cost as the key to unlocking access, making health plans dramatically more affordable, addressing medical liability, and moving away from employer-based plans by giving any group -- whether an employer or not -- the ability to organize their own health insurance pools? 

I was there, and I can attest that the Bush Administration did make good faith efforts to move medical liability and association health plans, but it was never the central, overarching focus. It was clear they would never expend political capital like they did on the prescription drug issue that they let themselves get baited on by Al Gore in the 2000 campaign, or the war, or tax cuts. 

A well-developed Republican health reform effort could have addressed the high cost of health care -- actually the most glaring issue in our system -- in a way that would have served as a kind of tax cut for the already insured. And in lowering costs, we could have covered the people who wanted health care but couldn't afford it -- the nub of the uninsured problem. 

Debate the details of this all you want, but the political upshot of this would have been to render the health care issue, a major Democratic hobbyhorse, politically dead for a generation. A bill less ambitious in scope, designed to address real pain points not a quixotic campaign for 100% insurance, could have forestalled this bill even in the event of a complete Democratic takeover. 

This may be oversimplified. There are certainly many very good conservative health care scholars whose work I should have been reading more closely these last few years. But politics is a battle of perceptions, and the perception -- that became reality -- was that Republicans brought a knife to a gun fight when it came a debate about the scope and reach of health care reform. We may have won the political battle over health care, in that a majority of Americans opposed Obamacare, but sometimes it is the policy battles that set the tone for the future political battleground, moving the entire spectrum on which they are fought further left. 

Sunday, Bloody Sunday

I can't believe the news today

I can't close my eyes and make it go away

How long, How long must we sing this song, how long....

and the battle's just begun

there's many lost ,but tell me, who has won?..

Sunday, Bloody Sunday... Sunday, Bloody Sunday..


Shallow, Misinformed, and Feaful: Tea Partiers or Their Critics?

The answer is, Alex -- both, of course.

From the beginning, opposition to the tea party movement has sought to portray participants as a fringe element of conservatism; radical, anti-government protestors who never met a program they could support, or a Democrat who wasn't either a communist or socialist. Racist, homophobic, rabidly partisan, and dangerously myopic, such analyses of the tea partiers was de rigueur in both liberal and major media outlets.

The "CBO Street" Memo

You know the amazing accounting miracle of the health care reform bill,  where we can add a trillion dollars to federal spending and reduce the deficit.

Once again, if it sounds too good to be true, then it isn't.

Since the announcement that made Democrats 'giddy" we've ben treated to how this report isn;t worth the ink used on the paper. Forget the obvious dodge here, where the taxes kick immediately for ten years and the expensive part of the bill ony runs for six; we've got bigger fish to fry.

There seems to be a hard to justify $29 billion "plug number" in Medicaid reductions years from now.  

Unless the Democrats are really eager to hammer the medical community, it is assumed that they will forego a reduction in Medicare reimbursements...i.e. the "doc fix".  Remove this spurious budget reduction and there's about $208 billion in added costs; and this alone makes the bill in the red by $59 billion.. 

The Democrats have challenged the authenticity of a memo outlining this pretty little scam, but there's no doubt of the truth of the central allegation....the bill's true cost is being hidden so that in the midst of an era of trillion dollars deficits a fig leaf of fiscal responsibility is provided to the Blue Dogs.

I also suspect that one way the federal numbers were managed was to expand the unfunded Medicaid mandates on the states, therefore shifting expenses on their backs and imploding their already precarious budgetary situations. 

I'll leave to the likes of Megan McArdle and Keith Hennessey to find the other scams and gimmicks embedded in whatever bill Nancy Pelosi can cajole 216 votes for this evening. One message to deficit hawks. Tax increases and budget cuts deferred now for political expendiency now are highly likely to be deleted in the out years for political expendiency. But the left will defend the entitlement rules and expenditure levels.  Don't fall for the "Wimpy" approach.

I've seen documents like this before. It's like a sham appraisal used to get a subprime lender to approve a loan for more than what the property is really worth. It's like a Moody's rating on the MBS instruments secured by the bogus mortgages. It's a transparent "Made as Instructed" canard only Bernie Madoff could love.  Subsitute "Blue Dog" Congressman for "pension fund" and we now see a bogus deficit neutrality score is like a bogus investment grade rating. It justifies unwise investments.

Once upon a time there was an urgent matter for the national administration, which it sought to gain public and congressional support.  Supposedly the folks supposed to provide objective analysis were pressured into providing the evidence necessary to gain support for the policy agenda.

There were also allegations about memos and reports being "sexed up" to better sell the policy.

After we are years into the quagmire of expanding entitlements as the nation careens towards bankruptcy like a Toyota with a stuck accelerator, I suspect we will get some tell-all book about how the CBO budget process was manipulated.  I can;t wait to read the "CBO Street Memo"   Once upon a time even Ezra Klein complained about gimmicks.  I look forward to the meal of crow down the line.

 P.S. Last night on the House floor Ohio Democrat Rep. Ryan compared health care reform to Chevrolet.  Rep. Ryan is aware that General Motors went bankrupt, isn't he?    

Syndicate content