Relevant and even prescient commentary on news, politics and the economy.

Dr. Richard Wolff on the Sequester

I watched  Dr. Wolff (Professor emeritus, UMass) on this past week  episode with Bill Moyers.   At the end of this show, Mr. Moyers invited the viewers to submit questions to Dr. Wolf who has agreed to return in a couple of weeks to answer them.

Here is he with an interview by Julianna Forlano of Absurdity Today report.  If you are not familiar with Julianna, she does a very funny short news broadcast on the issues of the moment.  I am a subscriber.  It’s is worth your time for sure.

This is the first part of 4.  It is about 12 minutes.  I want to say, at the end, Dr. Wolff is also pointing out that the cuts do not come all at once.
    

I figure this video is also posted in response to the video rjs linked to in comments to Bev’s post.

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Gerrymandering the Jobs Bill

op ed by run75441

Think Progress offers a look at relevant parts of the ‘jobs bill’. In the US, the winds of Washington Politics don’t blow, they suck.

Gerrymandering the Jobs Bill:

The piece of the jobs bill Republicans will pass would end a requirement that the government withhold three percent of the cost of projects contracted out to private companies, to assure tax compliance. It’s a rule that Congress adopted during the Bush administration to cut down on tax cheating by government contractors.”

The proposals would incorporate a permanent repeal of the withholding which today saves $10 billion in lost taxes. To counter the revenue loss the Republicans have a solution (as paid for by Medicaid/SS recipients):

“all legislation other than permanent tax cuts for wealthy people must be paid for — typically with cuts to federal programs. So Republicans have selected a provision from Obama’s deficit reduction recommendations that would limit Medicaid eligibility for people who also receive Social Security benefits.

A concept called Modified Adjusted Gross Income is used to determine Medicaid eligibility. Currently, it only incorporates the taxable portion of Social Security income in that calculation. Under t a new proposal, it would factor in all Social Security benefits. That means some seniors who currently qualify for Medicaid would no longer be eligible. Doing this would save about $14.6 billion over 10 years — more than the cost of repealing the 3 percent withholding compliance measure.” GOP Lays Trap for Obama on Jobs Bill”

Finance the tax cheats and sacrifice Medicaid and SS recipients.

Watching Your Back???

In Order to open negotiations with the Repubs, the Dems on the Super Committee

“are offering to cut Medicare and Medicaid benefits as part of a roughly $3 trillion grand bargain, which would well exceed the $1.2 trillion minimum goal the committee is tasked with meeting.

The Democratic plan proposes cutting the deficit by $2.5 trillion to $3 trillion and calls for between $200 billion and $300 billion in new stimulus spending to boost an ailing U.S. economy. It would be paid for with lower interest payments from reducing deficits.

It also seeks around $400 billion in Medicare savings, with half coming in benefit cuts and the other half in cuts to healthcare providers. Details of that proposal were scant but tackling the popular Medicare program is always politically risky for politicians in Washington, especially Democrats.

The Democratic proposal also identifies $100 billion in cuts to the Medicaid healthcare program for the poor, according to a lobbyist in contact with the committee.”

Dems Seek $3trillion in Savings

Fortunately, The Repubs would not accept a tax increase on the income rich even with throwing Grandmother under the bus to finance it . . .

The Party of “No”rquist

It appears that many of the signers of the pledge representing “No”rquist beliefs and the Repub party over the constituency which elected them have feet made of sand as the currents of public anger are over whelming the views proffered.

ATR currently has signatures from 238 House representatives, 41 Senators, 13 governors, and all of the GOP presidential candidates except former Utah Governor Jon Huntsman.”

Anti-Tax Crusader Grover Norquist’s Grip is Slipping

Who elected these turkeys??? Hmmm, that’s right, we did and the views they are espousing? Even that ever lovable former Senator from that wilderness state west of the Hudson Wyoming is calling for a resistance to outside influence (ATR) which has no impact on getting elected again. And Senator Coburn challenged Norquist on Ethanol subsidies? Such bravado . . .

“Have we really reached a point where one person’s demand for ideological purity is paralyzing Congress to the point that even a discussion of tax reform is viewed as breaking a no-tax pledge?” Senator Wolf asked.

And the man with the perpetual sun tan Boehner asked of Norquist’s relevance.

“some random guy,

Grover told me that he saw himself as the Lenin of the conservative revolution and that Ralph Reed was his Trotsky and Jack Abramoff was his Stalin.”

As Oliver Wight used to say “Cement heads!” Someone has sounded the “abandon ship” alert as the Repub-titanic has struck the iceberg of public dissent. Maybe Occupy America has struck a nerve? It doesn’t take a weatherman . . . We will make the same mistake again and re-elect these turkeys.

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It used to be "slightly left of center". The budget, taxes, economy from that other side.

By: Daniel Becker
HT: Digby

More people need to hear this perspective regarding the economy and the budget debate if only to remind them that there is another perspective…if only to hear what it sounds like when a congress person is actually fighting and working for you. You, the one without enough money to influence congress.
JUDY WOODRUFF: Well, the president has talked about corporate — corporate tax reform. And he said, in two years, in — for 2012, he’s going to propose letting all those tax cuts expire that were allowed to continue in December.
You spent, what, eight-and-a-half-hours on the floor of the Senate in December in a — in a protest against that. Are you confident the president is going to let the tax cuts expire?
SEN. BERNIE SANDERS: No, of course I’m not. I mean, that’s what the president said when he ran for president. And yet, when the Republicans stood up to him and said, we want to give more tax breaks, extend the Bush tax breaks, essentially, the president gave in.
When the Republicans said that, we want to lower the estate tax, Judy, which appeals — which only applies to the top three-tenths of 1 percent — these are not rich folks — these the very richest people in America — the president gave into that.
So, the president may tell us that he has this in mind, but I think the record is that he has not fought for those principles. The American people want him to fight for those principles.
And I think what this whole budget debate is about is do we stand up and say, no, we’re not going to cut programs for those who need it?
The other issue that I think we have to talk about is, in the president’s budget, he talks about Social Security. And he makes me a little bit nervous, because I think, as many of our listeners know, the Social Security trust fund today has a $2.6 trillion surplus.
Social Security can pay out every benefit owed to every eligible American for the next 27 years. Social Security, because it is funded by the payroll tax, hasn’t contributed one nickel to the deficit.
See, there is another voice, and some are finally experiencing the results of ignoring it. Remember this! Remember what a congress person sounds like when they are for real about working and fight for you. No more excuses you did not know. This is what you will sound like once you decide to influence congress.

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Will catastrophic only health insurance be rescinded in the end?

rdan

Taunter explains how the .5% rescission rate figure discussed in the hearings on health insurance premiums and coverage is used to dismiss Congressional concerns as inconsequential and actually is a good business practice that will not change. It is worth going to the post to accurately follow the train of thought. Taunter concludes that the chances for rescission for a serious illness is:

If the top 5% is the absolute largest population for whom rescission would make sense, the probability of having your policy cancelled given that you have filed a claim is fully 10% (0.5% rescission/5.0% of the population). If you take the LA Times estimate that $300mm was saved by abrogating 20,000 policies in California ($15,000/policy), you are somewhere in the 15% zone, depending on the convexity of the top section of population. If, as I suspect, rescission is targeted toward the truly bankrupting cases – the top 1%, the folks with over $35,000 of annual claims who could never be profitable for the carrier – then the probability of having your policy torn up given a massively expensive condition is pushing 50%. One in two.

Rescission definition practice can be found here and unfair examples here. Here is why door number two is NOT 50/50.

It is suggested that application forms are formed to allow for inaccuracies and that some criterion used to cancel policies is easily avoidable at the time of the application, the implication being future use for the inaccuracy makes it worthwhile to allow ambiguity and not vet information, mainly for those who wind up claiming over $35,000 and who have severe, chronic conditions that make premiums from that person irrelevant to profit.

This may have not been the intent long long ago, and certainly fraud occurs, but rescission having a basis purely monetary and not legal (from a common consumer point of view on what fraud is), is the policy today if testimony is to be believed.

The first notion, that it is a small problem except for the person involved, is discussed in the first post. The key to amended %’s lies in the fact that Medicare takes care of the 65/over group of chronically ill and elderly clients, so the privately covered population is smaller than the per centages indicate as well, a major oversight. The second and third part of the problem will be in Part 2 and 3 (clever, huh?)

StatsGuy wrote in comments to the Taunter Media post:

StatsGuy
The same light bulb went off when I read the 0.5%, but I could not have explained it _nearly_ as well. Very nice post.

I still wonder, though, whether it might be slightly worse than even this picture.

1) I believe your data is for the US population as a whole. (If I’m wrong, then this comment is meaningless – apologies.) But, in fact, much of the sickest part of the population receives health care via Medicare because older people are (to use your technical term) sicker.

So the % of people in the top tier AMONG PEOPLE NOT ON MEDICARE is much lower, which means that the conditional probability of suffering rescission given that you need treatment is much higher. Roughly, if the % of people among under-65 (and not on Medicaid) in the top bracket was half of what it is for the entire population, then the probability of suffering rescission given that you have a large claim is double even your current estimates.

2) The probability of losing the policy given that you really need it may be X% in any given year. But there’s a cumulative effect – over time, you build up a reservoir of uninsurable who lost insurance due to rescission, and now cannot get it back because they have a chronic condition.

on July 29, 2009 at 10:03 am | Reply Taunter
You are absolutely correct about #1, and this is a huge error factor. 10% of Medicare costs take place in the last month of life alone, and Medicare is roughly 45% of the national health care spend. So all of those patients are clogging up the top end of national distribution and not on private insurance in the first place. Unfortunately, I can’t find a private-only, or individual-pay-only distribution, and of course if I did find an individual-pay-only distribution it would be skewed on the top with denied claims (some people should be spending a lot, but actually spend much less, because their policy was pulled). The Reuters article says Medicare spends 30% of its outlay on the top 5% of its population, which means it has a flatter curve than non-Medicare (I would assume, without evidence, that fewer Medicare beneficiaries have negligible health expenses). This implies non-Medicare spending is even more highly concentrated with a few very high spenders.

On #2, I’m a little less confident, and it was one of the reasons I may have misunderstood James’ original post. There is a cumulative effect, but that effect is blunted to some degree by the fact that the people who account for the very high medical expenditures do not necessarily change much from year-to-year (with the obvious exception of the end-of-life expenses typically borne by Medicare). In fact, one of the reasons I suspect rescission became such a powerful phenomenon is that if Sally has breast cancer at a young age, she is going to be in the 99th percentile several times; the carrier is weighing years of such expenses against her premium. So it might not be the case that in a forty year career an average person has a 33% chance of ending up at some point in the top percentile (1-(.99^40)); it is probably the case that most people have a tiny chance of ever getting an expensive chronic condition (or at least an expensive, chronic condition before turning 65), and some people have a large chance of repeatedly being in the top percent.

Keep the discussion going. It is clear a profit motive has serious impact for some people…how would you bet even catastropohic only insurance premium money?

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A Civil Libertarian is a Congressperson who got Wiretapped

Greenwald on Harman. Read the whole thing.

Sample:

when the U.S. Government eavesdropped for years on American citizens with no warrants and in violation of the law, that was “both legal and necessary” as well as “essential to U.S. national security,” and it was the “despicable” whistle-blowers (such as Thomas Tamm) who disclosed that crime and the newspapers which reported it who should have been criminally investigated, but not the lawbreaking government officials. But when the U.S. Government legally and with warrants eavesdrops on Jane Harman, that is an outrageous invasion of privacy and a violent assault on her rights as an American citizen, and full-scale investigations must be commenced immediately to get to the bottom of this abuse of power. [links in original omitted; emphasis his]

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US Legislators Profiting from War? Say it ain’t so, Joe

Seems it’s not just the executive branch and their friends that have “invested” in this war. From IPS comes a news article about the money invested by our legislators.

Members of Congress invested nearly 196 million dollars of their own money in companies that receive hundreds of millions of dollars a day from Pentagon contracts to provide goods and services to U.S. armed forces, say nonpartisan watchdog groups.

The article is based on a report by the Center for Responsive Politics, via their site: Opensecretes.org

Before we get to the meat of this, consider that I found this via Common Dreams.org’ copying the news article. The article is not a US based media article. Oh nooooooooo! It is a nonprofit, global news organization out of Rome publishing an article on a report by a US based watch dog group. THANK GOD FOR THE INTERNET!
Ok, I feel better. Don’t you?

The original article, Strategic Assets has a wonderful chart. Of the top 10 legislators invested in our military industrial complex, can you guess who has the most tied up? A hint: Of the top 10, 3 are democrats and they don’t include Nancy or Diane.

According to the most recent reports of their personal finances, 151 current members of Congress had between $78.7 million and $195.5 million invested in companies that received defense contracts of at least $5 million in 2006. In all, these companies received more than $275.6 billion from the government in 2006, or $755 million per day, according to FedSpending.org, a website of the budget watchdog group OMB Watch.

In 2004, the first full year after the Iraq war began, Republican and Democratic lawmakers—both hawks and doves—had between $74.9 million and $161.3 million invested in companies under contract with the Department of Defense.

Our esteemed colleagues have seem to have no concern about the image such investing may present:

The minimum value of Congress members’ personal investments in these contractors increased 5 percent from 2004 to 2006,…

Granted, some of the companies counted may seem unlikely candidates for being considered defense until you read:

As the military operations in Iraq and Afghanistan have expanded and transformed, so, too, has the need for goods and services that extend beyond helicopters, armored vehicles and guns. Giant corporations outside of the defense sector, such as Pepsico, IBM, Microsoft and Johnson & Johnson, have received defense contracts and are all popular investments for both members of Congress and the general public. So common are these companies, both as personal investments and as defense contractors, it would appear difficult to build a diverse blue-chip stock portfolio without at least some of them.

So, what’s a person to do with their 401K money if they want to be in the good, secure companies but does not want to promote war profiteering? As noted in the article, even without war, the solder needs tooth paste. But we are exercising our military currently and we’re using it up, which means replacement costs are accelerated. Though maybe tooth paste is used at no greater rate. Though we did call in all those reserves. Which might explain Pepsico getting $187 million in 2006 but it does not explain:

In the case of Sen. Jay Rockefeller (D-W.Va.), chair of the Senate Select Intelligence Committee, his stock in Pepsico, which is worth at least $1 million, is actually held by his wife, who is on the food and beverage corporation’s board of directors.

Nor does it explain this:

Petraeus will speak on April 8 and 9 to the Senate Foreign Relations and Armed Services committees. In 2006, members of these two committees had between $32 million and $44 million invested in companies with DOD contracts. Foreign Relations member Kerry’s investments accounted for most of it—between $28.9 million and $38.2 million. Members of the two committees held between $3 million and $5.1 million in defense-only companies.

What is there to say? Military spending of war does increase GDP for the good? Privatization of the military goes far beyond mercenaries? The USA is an economy of war making? It’s just business? I’m a fool for not riding the money wave?

The army and the empire may be falling apart
The money has gotten scarce.

One mans word held the country together
But the truth is getting fierce.

END

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