Surprase, Surprase, Surprase

Well, to quote that well known sage Gomer Pyle, "Surprase, surprase, surprase". President Obama was born in this country after all. But, we shouldn't be surprised that so many folks were swept up in the silly notion that he was born in a foreign country, despite the clear evidence to the contrary.

It wasn't all that long ago that the previous Administration took us into a war that cost hundreds of billions of dollars and thousands of lives using justifications that turned out to be totally specious. After that experience, it will take a long, long time for people to regain faith in our institutions, if it will ever happen.

Too bad there was no certificate we could have gotten to show there were no WMDs, no nukes, and that Sadaam had nothing to do with 9-11.

First Steps To Balance The Budget

Folks from throughout the political spectrum should be able to agree on one thing – we are living beyond our means. We’ve been doing so since 2001, after a brief sojourn in the 1990s when the budget was balanced. It’s much harder to reach consensus on what we should do about it. Some, like Rep. Paul Ryan, say we must balance our budget solely by cutting federal expenditures. The inevitable result of this will be substantial cuts to programs that benefit the neediest in our society, including ending Medicare as we have known it.

One way to get at a possible solution to this dilemma is to look at some statistics. In 2007, the last year for which such information is available, the top 1% of the US population held 43% of the country’s financial wealth and 35% of the total net worth. By contrast, the bottom 80% of the population has only 7% of financial wealth and 19% of the total net worth. The percentage held by the very wealthy has been steadily increasing during the past generation, and dramatically so since 2001, when the Bush tax cuts on the rich came into effect. We have become a nation of haves and have-nots, reminiscent of the gilded age of the robber barons.

There is no question that we will all have to do more with less to balance out federal budget. But, surely the place to start is to eliminate the Bush tax cuts on the rich. They have benefitted richly from our great country. They should be willing to repay their fair share.

Don’t Throw Seniors Under The Bus To Balance The Budget

I was in the optician’s office the other day, waiting for a new lens to be put in my glasses. I was feeling a bit sorry for myself as I struggled to read a magazine without glasses. Then, a fellow came in pushing an elderly lady in a wheelchair. I try not to be nosy, but it was hard not to overhear them.

She had just been to the ophthalmologist, and had been told she needed to have cataract surgery. It became clear that she lives alone without any family close by. The gentleman who brought her in goes to the same church as her, and has been helping her for years, transporting her to appointments and helping her with financial matters. The cataract diagnosis had obviously had upset her, and she struggled to hold back tears as she tried to work out whether or not she should have this surgery at 90 years of age. Her friend from church tried to console her. When she asked what she would owe for the visit to the ophthalmologist as well as this minor repair to her glasses, he had encouraging words. The doctor visit was covered by Medicare and the optician probably wouldn’t charge to fix her glasses.

Folks like this lady can sometimes struggle through what are supposed to be their golden years. Things promise to get even worse for her successors if the plan to privatize Medicare is enacted. Under Rep. Paul Ryan's proposal, seniors and others on Medicare would begin receiving a set amount of money, starting in 2022, to offset the cost of buying a private insurance plan. This plan to replace the federal government's Medicare plan sounds good in theory. Ryan says that applying what he calls "free-market principles" to the insurance market is the best way to control costs.

But, will it really work out that way? The independent Congressional Budget Office (CBO) says otherwise. CBO’s review of Ryan’s program estimates seniors would end up paying almost twice as much out of their own pockets — or more than $12,510 a year. Altogether, the total cost of health care would be higher. That is why a number of studies show that voucher programs like the one Rep. Ryan is proposing will not reduce health care costs.

Why is that? It turns out that buying health insurance is different from picking out a car or groceries. You and I can figure out which auto will be best for us by comparing different models and using resources like Consumer Reports. We can choose whether we want to buy the name brand box of corn flakes or the generic store brand. But, how many of us can figure out which is the best health care plan for us, given the myriad factors like deductibles, exclusions from coverage, lifetime caps, etc., etc.?

Rep, Ryan says he wants seniors to be covered by a plan that is similar to that currently in effect for federal employees. But, here’s an interesting fact. Under the Federal Employees Health Benefits Program, costs have risen over 64% over the last five years, far faster than health care costs generally and faster than Medicare costs have increased. Of course, under Rep. Ryan’s plan, the federal government will only be paying a fixed amount to each senior for health care, meaning that our seniors will bear the brunt of higher health care costs.

Now, maybe, you and I can educate ourselves so that we can make an intelligent choice among health care providers. But, is this a burden we want to impose on frail seniors like the lady in my optician’s office? Is it morally right to make her have to figure out which health insurance option is best for her? Is it right to make her bear a steadily increasing share of health expenses as we switch from a program with a good track record of containing costs to one that has let costs rise much faster?

We will all need to make sacrifices to balance our federal and state budgets. Rep. Ryan’s plan mostly imposes the sacrifices on the elderly and less fortunate, those least able to bear it. I think we should couple some cuts to these programs with some revenue increases. These should include a repeal of the Bush tax cuts on the rich. We should also close some loopholes in the individual and corporate tax codes that allow those with the brightest lawyers and accountants to avoid paying taxes. Those who have benefitted the most in our society should contribute their fair share. Just throwing the elderly under the bus is the wrong solution to our budget problems.