Tag Archives: Medicare

Representation Without Taxation Doesn’t Work Either

Today being tax day, it seems a good time to remind ourselves of some key figures. Most Americans give at least a cursory look at their household budget monthly as they pay their bills or perhaps weekly if they’re in the tough position of living paycheck-to-paycheck. But, few stop to review their country’s financial state even once a year. Perhaps that should become a tradition on tax day. After all, Americans would call their cell phone provider and dispute a $10 unexplained charge; so why do they continue to pay thousands each year without asking why or where it’s going?

So here it is, the federal budget for the next ten years, as laid out by President Obama. Be sure to note, it is displayed in billions of dollars.

Allow me to round some figures off in summation: This year, the federal government will take in $2.2 trillion while spending $3.7 trillion (a $1.5 trillion deficit on top of the existing $11 trillion federal debt). Notice they expect the best year in the next ten, 2014, to still be a net loss of $706 billion, even if some wild optimism on Washington’s part comes to fruition.

This is the equivalent of an American family that earns $100,000 per year spending $168,000 while carrying $600,000 in debt; writing IOUs for the $68,000, and planning to do the same thing each of the next ten years and beyond. None of us would do that, so I can’t believe there’s a person in this country dumb enough to think the government’s numbers work, but there is. In fact, there are millions of them. A few of these work in the Lame Stream Media and will go on TV tonight and deride their fellow citizens who are at rallies all over the country today protesting this very spending lunacy, even though it seems the protesters are the only ones paying attention.

But how can millions of people who think the government’s budgetary suicide is ok? Well, that’s easy – 47% of all Americans pay NO FEDERAL INCOME TAX! Put simply, these people have no skin in the game. They are too short-sighted to realize that at the very least, their kids might some day have to pay this bill; or much worse, that a financial default by this country will mean financial pain for all – especially those who currently live off the taxpayer’s largess. Still, come election day, they have the same voting power as those footing the bill, and therein lies the problem. As Ben Franklin so accurately said, “When the people find that they can vote themselves money, that will herald the end of the republic.”

Taxation without representation was cause for a Declaration and War of Independence. Turns out representation without taxation doesn’t work so well either.

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Filed under Government Spending, Taxation

Will There Be a Doctor In the House?

Today the Wall Street Journal reports that the U.S. will likely face a doctor shortage in coming years. Now who could have ever predicted that this would happen? Oh, that’s right, I DID! And frankly, I believe this article vastly underestimates the problem. The heaviest users of medical services are not those with their own insurance – no, having paid handsomely for it, they know better than to abuse it. Instead it’s those who have been granted “free” health care by the state, and we’ve just added 17 million people to that category, and if the administration gets its way with amnesty in the coming months another 12-17 million.

On top of that, there is a high probability of many current doctors leaving the profession due to dissatisfaction with the new system. My primary care doctor tells me he’s closed to new patients for the specific reason that he refuses to take on more medicare patients and the mountains of paperwork and pitiful compensation they bring with them. If you don’t believe the system underpays, just ask Walgreens who recently announced they will no longer fill medicaid prescriptions in the state of Washington because it’s a “money losing proposition”! At the behest of the corporately owned hospitals who don’t like competition, the bill also bans doctor-owned hospitals which will result in the immediate cancellation of 60 planned new hospitals across the country and what would have been hundreds more in the future.

But, allow me to go a step further and make a new prediction, one which will take years to unfortunately come to fruition and then decades (if ever) to reverse. I shouldn’t really call it a prediction as it’s simple supply and demand logic; Adam Smith could have predicted this 250 years ago. What happens when there is a shortage of a product – in this case, doctors? The price goes up. But, what happens when an all-knowing (at least they think they’re all-knowing) government holds prices down while the demand is going up? Quality goes down, way down!

In the coming decade, medical schools will be under immense pressure to fill this void of doctors. Students who would not have been admitted in the past will likely get in, and those who would have washed out may very well be passed on. Once in the field, these sub-standard doctors will be without the free-market incentive of do the best work, make the most money. They will be seeing too many patients, too infrequently while being pressured by the government to keep costs down. That should work out well…

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Filed under Health Care

Medicare and Social Security Running Out of Money

2017. That is when the Medicare system will run out of money at the current pace. Eight short years from now the federal government will have to begin borrowing money (on top of all the money it is already borrowing) to pay for its obligations under Medicare. The Social Security picture seems practically rosey by comparison with 30 years of solvency remaining. But, don’t be lulled into a false sense of security on that front. Social Security is the single largest government expenditure next to Defense costing roughly $650 billion annually. When it goes insolvent, and it will, the magnitude of that problem will be staggering.

So then, it makes perfect sense that while the government can’t fund the obligations it has, we should add more un-fundable obligations to the books in the form of national health care, right? ‘Cause if any one of us had a mortgage we couldn’t afford to pay what we’d do is run right out and buy a second home with a price tag 10 times the size, right? Let’s have a little common sense people. Anyone with even the slightest ability to reason, should be able to take one look at the chart below and understand that the jig is up, the game’s over, or whatever other cliche’ you prefer.

federal spending

Note that Medicare, Medicaid and Social Security spending alone will exceed TOTAL FEDERAL TAX RECEIPTS in roughly 40 years. Now imagine that we tack on a new program larger than all of those combined (yes I said larger than all of those combined!); where will that put us? It is time for this government, this administration, to put the brakes on its giddy spending spree and first see if they can even figure out how to fund their exisiting obligations before they go saddling the American people with more.

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Filed under Financial, Government