VIDEO: Paul Ryan at Health Care Summit

Paul Ryan does an excellent job of summarizing the budget gimmickry and issues with the current health care bills. It amazes me that the conversation could just go on without addressing these numbers. Obama just said that he had some problems with Ryan's numbers and moved on to another Democrat to speak about something else.

I hate the format where each speaker gets to talk for a set period of time, and there's very little back and forth actually hashing out any issues. And the whole summit, Obama gets to constantly frame the discussion after every Republican speaks.

In this case, there should have been considerable discussion addressing the points that Paul Ryan made.

By the way, I wish the Republicans had tried a lot harder to pin down Reid and Obama by asking them both to commit to not passing a bill using reconciliation or signing a bill that was passed using reconciliation. It would have made headlines if while being pressed hard Obama and Reid refused to make that commitment during the bi-partisan summit. It would have exposed how much of a sham the summit was. I'm willing to bet that if the Democrats think they have the votes to pass the Senate bill in the House, and a 2nd bill in both houses that would pass the Senate via reconciliation, that they will jam in through in the next few weeks.

2 Graphs: Jobs and Housing prices

Powerline blog has a great post with two informative graphs.

1. A graph of job gains or losses per month. It shows the natural cycle already starting trending upwards before Obama's policies could have had any effect. It's always important to keep in mind the business cycle's trends when evaluating whether policies have helped or not.

2. A graph of the housing market, asjusted for inflation, since 1900. It makes it clear how government policies and lower lending standards and easy money policies and the market irrationality caused by opaque mortgage-backed securities and their derivatives had thrown housing prices completely out of whack. They are only now back down near, but still higher, than the historical average. Based on this graph, you could expect anything from a stabilization in prices in the near future to a further pendulum swing down another 20-30%.

Obama's Jobs Proposals

In the State of the Union address on Wednesday, and again at the Republican annual conference meeting on Friday, President Obama outlined several proposals for a "jobs bill". I'm trying to think through the pros and cons of each.

1) An up to $5000 tax credit for businesses for each employee hired in 2010.

2) A payroll tax refund (dollar for dollar) for employers who give raises to employees earning under $100,000 for the amount of the raise that is greater than the rate of inflation.

3) Eliminate the capital gains tax for small business investment.

4) Take $30 Billion returned from the Wall Street banks, and give it to community banks to start lending to small businesses again.

(well, I've typed out the proposals, but gotta run for now -- will analyze later)


Here's some more proposals from the meeting with Republicans on Friday:

5) A "modest fee on the nation's largest banks and financial institutions to fully recover for taxpayers' money that they provided to the financial sector when it was teetering on the brink of collapse, and it's designed to discourage them from taking reckless risks in the future."

6) "I propose that we close tax loopholes that reward companies for shipping American jobs overseas, and instead give companies greater incentive to create jobs right here at home."

7) "I've proposed a 3-year freeze in discretionary spending, other than what we need for national security... that's consistent with a lot of the talk... we can't blink when it's time to actually do the job."

8) PAYGO rules -- just passed in Senate.

9) Bipartisan fiscal commission -- I'm going to establish one by executive order, after one died in the Senate the other day. "I hope you participate fully..."

Obama goes on to health insurance, but I don't have time to fisk it all.

International Welfare Creates Dependency Too

Bret Stephens takes the occasion of Haiti's plight to remind people that long-term Foreign Aid (as opposed to short-term emergency humanitarian assistance which almost everyone supports) is part of the problem.

Take something as seemingly straightforward as food aid. "At some point," Mr. Shikwati [, a Kenyan economist,] explains, "this corn ends up in the harbor of Mombasa. A portion of the corn often goes directly into the hands of unscrupulous politicians who then pass it on to their own tribe to boost their next election campaign. Another portion of the shipment ends up on the black market where the corn is dumped at extremely low prices. Local farmers may as well put down their hoes right away; no one can compete with the U.N.'s World Food Program."

Foreign Aid more often than not destroys the local production capacity of the items being provided as aid, and thus creates dependency instead. And to make matters worse, it always props up corrupt local politicians who use their power in the aided country to direct aid for political reasons, or make money off the aid using various schemes, such as buying and running the trucking companies that actually deliver the aid.

American foreign aid, apart from emergency aid like in Haiti right now, in my opinion, should be carefully limited to forms that promote local good governance and increased production capacity in the aided country. Otherwise, it does more harm than good.

The reasons that poor countries are poor is directly due to their economic and government systems. There are numerous examples of countries quickly rising out from the third to first world in a matter of a decade or two with free markets and protecting property rights. The ones that stay mired in poverty are almost all characterized by corrupt governments and dysfunctional economic systems. Foreign investment is almost non-existent in these countries.

Those core reasons for why a country remains poor are by-in-large harmed by long-term foreign aid.

BigJourn: Fisking AP ClimateGate Article

On Andrew Breitbart's new BigJournalism.com website, there is a great fisking of the big AP writeup immediately after the ClimateGate scandal broke back in December 2009.

The AP's article probably had the largest reach of any writeup on the scandal, as it was no doubt featured prominently in most newspapers around the country as well as on countless news aggregator websites.

The AP assigned 5 reporters to the article, who reviewed the emails and got comment from only 4 scientists, taking pains to point out that the one AGW (anthropogenic global warming) skeptic was not a true scientist, even though the other quoted scientists were not in the field of climatology either. Further they distort what the scientists said, or at least what their positions were when contacted by the Big Journalism article's authors, to downplay the significance of the ClimateGate emails and computer code.

The AP article is also conspicuous in who it did not quote, including any of the Global Warming crowd who wrote the emails and computer code, or any of the skeptics who are frequently mentioned in the emails. I'll give them the benefit of the doubt that with the computer code, the AP just hadn't had enough time to have computer programmer pore through all the code yet.

Here's the link to the Big Journalism article.

Be sure to read it. Articles like these are crucial to understanding the bias inherent in supposedly "objective" news reporting.

The biggest error by the AP is in coming to such sweeping and pre-judged conclusions as the headline "Science Not Faked..." when that remains to be seen. There have been many articles since ClimateGate broke which question some of the data itself, and not much can be determined for sure until these Global Warming scientists open up their data and climate models for independent review. The AP headline could have just as easily and validly have been "Scientists' Methods & Motives Now In Question".

Real Health Reform

Reason has a pretty good summary of what real market-based health reform would look like.

House & Senate Health Care Bill Details

The AP did a fair job of summarizing the Senate and House health care bills.

The Senate Democratic bill (Patient Protection and Affordable Care Act):

WHO'S COVERED: About 94 percent of legal residents under age 65—compared with 83 percent now. Government subsidies to help buy coverage start in 2014. Of the remaining 24 million people under age 65 left uninsured, about one-third would be illegal immigrants.

COST: Coverage provisions cost $871 billion over 10 years.

HOW IT'S PAID FOR: Fees on insurance companies, drugmakers, medical device manufacturers. Medicare payroll tax increased to 2.35 percent on income over $200,000 a year for individuals, $250,000 for couples. A 10 percent sales tax on tanning salons, to be paid by the person soaking up the rays. Cuts to Medicare and Medicaid. Forty percent excise tax on insurance companies, keyed to premiums paid on health care plans costing more than $8,500 annually for individuals and $23,000 for families. Fees for employers whose workers receive government subsidies to help them pay premiums. Fines on people who fail to purchase coverage.

REQUIREMENTS FOR INDIVIDUALS: Almost everyone must get coverage through an employer, on their own or through a government plan. Exemptions for economic hardship. Those who are obligated to buy coverage and refuse to do so would pay a fine starting at $95 in 2014 and rising to $750.

REQUIREMENTS FOR EMPLOYERS: Not required to offer coverage, but companies with more than 50 employees would pay a fee of $750 per employee if the government ends up subsidizing employees' coverage.

SUBSIDIES: Tax credits for individuals and families likely making up to 400 percent of the federal poverty level, which computes to $88,200 for a family of four. Tax credits for small employers.

BENEFITS PACKAGE: All plans sold to individuals and small businesses would have to cover basic benefits. The government would set four levels of coverage. The least generous would pay an estimated 60 percent of health care costs per year; the most generous would cover an estimated 90 percent.

INSURANCE INDUSTRY RESTRICTIONS: Starting in 2014: no denial of coverage based on pre-existing conditions. No higher premiums allowed for pre-existing conditions or gender. Limits on higher premiums based on age and family size. Starting upon enactment of legislation: children up to age 26 can stay on parents insurance; no lifetime limits on coverage.

GOVERNMENT-RUN PLAN: In place of a government-run insurance option, the estimated 26 million Americans purchasing coverage through new insurance exchanges would have the option of signing up for national plans overseen by the same office that manages health coverage for federal employees and members of Congress. Those plans would be privately owned, but one of them would have to be operated on a nonprofit basis, as many Blue Cross Blue Shield plans are now.

HOW YOU CHOOSE YOUR HEALTH INSURANCE: Self-employed people, uninsured individuals and small businesses could pick a plan offered through new state-based purchasing pools. Would generally encourage employees to keep work-provided coverage.

DRUGS: Grants 12 years of market protection to high-tech drugs used to combat cancer, Parkinson's and other deadly diseases. Drug companies contribute $80 billion over 10 years with the majority of the money used to limit the prescription coverage gap in Medicare.

CHANGES TO MEDICAID: Income eligibility levels likely to be standardized to 133 percent of poverty—$29,327 a year for a family of four—for parents, children and pregnant women. Federal government would pick up the full cost of the expansion during the first three years. States could negotiate with insurers to arrange coverage for people with incomes slightly higher than the cutoff for Medicaid.

LONG-TERM CARE: New voluntary long-term care insurance program would provide a basic benefit designed to help seniors and disabled people avoid going into nursing homes.

ANTITRUST: Maintains the health insurance industry's decades-old antitrust exemption.

ILLEGAL IMMIGRANTS: Would be barred from receiving government subsidies or using their own money to buy coverage offered by private companies in the exchanges.

ABORTION: The bill tries to maintain a strict separation between taxpayer funds and private premiums that would pay for abortion coverage. No health plan would be required to offer coverage for the procedure. In plans that do cover abortion, beneficiaries would have to pay for it separately, and those funds would have to be kept in a separate account from taxpayer money. Moreover, individual states would be able to prohibit abortion coverage in plans offered through the exchange, after passing specific legislation to that effect. Exceptions would be made for cases of rape, incest and danger to the life of the mother.

____

The House bill (Affordable Health Care for America Act):

WHO'S COVERED: About 96 percent of legal residents under age 65—compared with 83 percent now. Government subsidies to help buy coverage start in 2013. About one-third of the remaining 18 million people under age 65 left uninsured would be illegal immigrants.

COST: The Congressional Budget Office says the bill's cost of expanding insurance coverage over 10 years is $1.055 trillion. The net cost is $894 billion, factoring in penalties on individuals and employers who don't comply with new requirements. That's under President Barack Obama's $900 billion goal. However, those figures leave out a variety of new costs in the bill, including increased prescription drug coverage for seniors under Medicare, so the measure may be around $1.2 trillion.

HOW IT'S PAID FOR: $460 billion over the next decade from new income taxes on single people making more than $500,000 a year and couples making more than $1 million. The original House bill taxed individuals making $280,000 a year and couples making more than $350,000, but the threshold was increased in response to lawmakers' concerns that the taxes would hit too many people and small businesses.

There are also more than $400 billion in cuts to Medicare and Medicaid; a new $20 billion fee on medical device makers; $13 billion from limiting contributions to flexible spending accounts; sizable penalties paid by individuals and employers who don't obtain coverage; and a mix of other corporate taxes and fees.

REQUIREMENTS FOR INDIVIDUALS: Individuals must have insurance, enforced through a tax penalty of 2.5 percent of income. People can apply for hardship waivers if coverage is unaffordable.

REQUIREMENTS FOR EMPLOYERS: Employers must provide insurance to their employees or pay a penalty of 8 percent of payroll. Companies with payrolls under $500,000 annually are exempt—a change from the original $250,000 level to accommodate concerns of moderate Democrats—and the penalty is phased in for companies with payrolls between $500,000 and $750,000.

Small businesses—those with 10 or fewer workers—get tax credits to help them provide coverage.

SUBSIDIES: Individuals and families with annual income up to 400 percent of poverty level, or $88,000 for a family of four, would get sliding-scale subsidies to help them buy coverage. The subsidies would begin in 2013.

HOW YOU CHOOSE YOUR HEALTH INSURANCE: Beginning in 2013, through a new Health Insurance Exchange open to individuals and, initially, small employers. It could be expanded to large employers over time. States could opt to operate their own exchanges in place of the national exchange if they follow federal rules.

BENEFITS PACKAGE: A committee would recommend a so-called essential benefits package including preventive services. Out-of-pocket costs would be capped. The new benefit package would be the basic benefit package offered in the exchange.

INSURANCE INDUSTRY RESTRICTIONS: Starting in 2013, no denial of coverage based on pre-existing conditions. No higher premiums allowed for pre-existing conditions or gender. Limits on higher premiums based on age.

GOVERNMENT-RUN PLAN: A new public plan available through the insurance exchanges would be set up and run by the health and human services secretary. Democrats originally designed the plan to pay Medicare rates plus 5 percent to doctors. But the final version—preferred by moderate lawmakers—would let the HHS secretary negotiate rates with providers.

CHANGES TO MEDICAID: The federal-state insurance program for the poor would be expanded to cover all individuals under age 65 with incomes up to 150 percent of the federal poverty level, which is $33,075 per year for a family of four. The federal government would pick up the full cost of the expansion in 2013 and 2014; thereafter the federal government would pay 91 percent and states would pay 9 percent.

DRUGS: Grants 12 years of market protection to high-tech drugs used to combat cancer, Parkinson's and other deadly diseases. Phases out the gap in Medicare prescription drug coverage by 2019. Requires the HHS secretary to negotiate drug prices on behalf of Medicare beneficiaries.

LONG-TERM CARE: New voluntary long-term care insurance program would provide a basic benefit designed to help seniors and disabled people avoid going into nursing homes.

ANTITRUST: Would strip the health insurance industry of a long-standing exemption from antitrust laws covering market allocation, price-fixing and bid rigging. The bill also would give the Federal Trade Commission authority to look into the health insurance industry at its own initiative.

ILLEGAL IMMIGRANTS: Would be barred from receiving government subsidies but permitted to use their own money to buy coverage offered by private companies in the exchange.

ABORTION: Private companies in the exchange could not offer plans covering abortion if those plans received federal subsidy money. Most plans in the exchange would be affected, because most consumers in the exchange would be using federal subsidy money to buy coverage. The new government plan could not offer abortion coverage. Insurance companies would be permitted to offer supplemental abortion coverage in separate plans that people could buy with their own money. Use of federal money for abortion coverage would be limited to cases of rape, incest or danger to the woman's life.