I believe the nation and even the world would benefit if our president underwent some psychiatric therapy. He seems to have a pathetic need to always have an enemy to do battle with and often it is the wrong one. He is intelligent enough to know fact from fiction but he seems to revel in un-truths and the Rep. from S. Carolina has been proven correct as was Justice Alito - we have a president who lies.
Then today, Nancy Pelosi spoke out about threats to various members who voted against their previous spoken principles. She is right to speak out against such threats. However, when Pelosi talked about being an open society my eyes rolled. She and her minions did everything in the book to obfuscate, hide and employ deceitful tactics to ram through legislation that was almost universally opposed. She even stated the need to pass the bill first so that it could then be understood and corrected. One of the Representatives even flatly acknowledged disregarding rules was what Democrats were all about. You reap what you sow.
Now Obama is about selling a bill which, with each days passing, brings new revelations of what it might mean.
Shame on Democrats for their thuggery. (See 1, 1a and 1b below.)
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Daniel Henninger offers two solutions: Repeal the legislation as well as the Democrats! (See 1c below.)
Finally more shenanigans as Obama sneaks in legislation with the health care bill to control more of our once free economy. (See 1d below.)
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Now that movie ticket prices are going up akin to insurance premiums will the Obama price czar raise a stink and start calling for regulation? (See 2 below.)
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Max Boot sees a correlation between Obama's spending and its impact on both our future military power and ability to meet threats from emerging nations. I would not doubt that this is what is also in the back of Obama's mind - weaken America and the world will be a safer place because it curbs our appetite for war mongering. (See 3 below.)
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Health care costs and the declining fortunes of The Social Security "Mother Hubbard" lock box per The New York Times. (See 4 below.)
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Congratulations you played dirty but you won and winning is everything when your sole principle is based on the means being justified by the results.
Obama is selling. The question is whether the voters are buying. Personally I would not buy a used car from him.(See 5 and 5a below.)
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You must be a ninny if you want to become a nanny nation! (See 6 below.)
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After 'Obamascare' got passed I could not resist! (See 7 below.)
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The happiest of Passovers which begins Monday evening and Easters which begins next Sunday a week.
Dick
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1)Companies Confused by Health Legislation
Critics Say Bill Discourages Firms From Expanding, but Others Hope Plan Will Help Cut Premiums, Level Playing Field.
By SARAH E. NEEDLEMAN
Small businesses, some of which had fought against the health-care reform bill, will now have to adjust to life with it.
Starting in 2014, organizations with more than 50 employees that don't offer affordable coverage will pay a penalty starting at $750 a year per full-time worker. A new proposal that still requires Senate approval would raise that penalty to $2,000. Smaller companies are exempt from the penalties, and some will receive a tax credit for providing health insurance—as long as they have fewer than 25 employees and average annual wages of less than $50,000 per employee.
Some groups, such as the National Federation of Independent Business, are concerned that the legislation discourages businesses with fewer than 50 employees from expanding their payrolls. "The tax credit itself is limited by a firm's size and wages, so if you want to remain eligible, you need to remain small and not pay high wages," says Amanda Austin, the trade group's director of federal public policy.
Others say the legislation, which would create state-based exchanges through which companies can purchase coverage, doesn't address a chief concern: the spiraling costs of health insurance.
Keith Ashmus, chair of the National Small Business Association says the bill is likely to increase insurance premiums because it eliminates caps on benefits and requires insurers to cover children on their parents' policies until they turn 26. "Premiums will go up under this bill faster than they would otherwise," he says. "Some of that will be offset by subsidies for some small businesses but only for a limited period of time."
Samantha Lapin, president and chief executive of POD Inc., a small computer-services company in Albuquerque, N.M., says insurance premiums have increased for her 60-employee firm up to 15% a year for the past decade. "The big disappointment is there's nothing in this bill to prevent our rates for continuing to increase the way they have," she says. "There's no cost containment."
But Jim Houser, co-owner of Hawthorne Auto Clinic Inc., in Portland, Ore., says he thinks the health-care overhaul will help lower insurance premiums for small businesses. "There will be more people in the system and so the costs will be spread out among a larger pool of people," says Mr. Houser, whose shop covers 100% of the health-insurance costs for its nine full-time employees as well as their families. He says premiums have doubled over the past eight years and now account for 20% of the company's payroll.
"My hope is that we'll have more predictability in our premium costs and they will go down over time," says Mr. Houser, a member of Main Street Alliance, a national network of small business coalitions focused on health care.
Georgia Berner, owner of Berner International Corp., a manufacturer in New Castle, Pa., has 60 employees and covers 100% of their insurance premiums. She says she expects the health-care bill to benefit her firm by requiring her rivals to make a comparable financial investment.
"It is leveling the playing field," says Ms. Berner, also a co-chair of the health committee for Women Impacting Public Policy, a support organization for women and minorities in business. "If my competitor doesn't have to have coverage then he can price his product more market friendly."
A number of small-business owners say they are uncertain as to what the health bill will mean for their ventures.
Nickolas C. Ekonomides doesn't currently provide health insurance for the seven to 10 employees he typically keeps on the payroll for his Clearwater Beach, Fla., Web-services firm, Ekomerica LLC, which operates under the name TG Web Media.
Now Mr. Ekonomides is concerned that the new legislation will force his workers to buy health insurance on their own or pay a penalty, even if they don't want it, and that this might prompt them to demand raises. "I'm hoping tax credits will offset the costs, but I don't know that they will," he says.
Patty Briguglio, owner of MMI Public Relations Inc. in Raleigh, N.C., says she's concerned that "S" corporations like hers won't receive tax credits for providing workers with health benefits since profits pass through owners' personal tax returns. "Many times those tax credits can't be applied to S corporations," she says. "And they can be lopped off in a minute. The government can decide to give them one year but not the next."
Ms. Briguglio says she currently doesn't provide her 20 employees with a group health plan but rather gives them a $2,400 annual allowance so they can buy their own. "It's less expensive than a group plan because I have a young work force," she says. "What's going to happen? Are they going to force me to buy a group plan that will cost me more? Should I stop growing so I can get tax incentives?"
1a)ObamaCare Day One:Companies are already warning about higher health-care costs
Democrats dragged themselves over the health-care finish line in part by repeating that voters would like the plan once it passed. Let's see what they think when they learn their insurance costs will jump right away.
Even before President Obama signed the bill on Tuesday, Caterpillar said it would cost the company at least $100 million more in the first year alone. Medical device maker Medtronic warned that new taxes on its products could force it to lay off a thousand workers. Now Verizon joins the roll of businesses staring at adverse consequences.
In an email titled "President Obama Signs Health Care Legislation" sent to all employees Tuesday night, the telecom giant warned that "we expect that Verizon's costs will increase in the short term." While executive vice president for human resources Marc Reed wrote that "it is difficult at this point to gauge the precise impact of this legislation," and that ObamaCare does reflect some of the company's policy priorities, the message to workers was clear: Expect changes for the worse to your health benefits as the direct result of this bill, and maybe as soon as this year.
Mr. Reed specifically cited a change in the tax treatment of retiree health benefits. When Congress created the Medicare prescription drug benefit in 2003, it included a modest tax subsidy to encourage employers to keep drug plans for retirees, rather than dumping them on the government. The Employee Benefit Research Institute says this exclusion—equal to 28% of the cost of a drug plan—will run taxpayers $665 per person next year, while the same Medicare coverage would cost $1,209.
In a $5.4 billion revenue grab, Democrats decided that this $665 fillip should be subject to the ordinary corporate income tax of 35%. Most consulting firms and independent analysts say the higher costs will induce some companies to drop drug coverage, which could affect about five million retirees and 3,500 businesses. Verizon and other large corporations warned about this outcome.
U.S. accounting laws also require businesses to immediately restate their earnings in light of the higher tax burden on their long-term retiree health liabilities. This will have a big effect on their 2010 earnings.
While the drug tax subsidy is for retirees, companies consider their benefit costs as a total package. The new bill might cause some to drop retiree coverage altogether. Others may be bound by labor contracts to retirees, but then they will find other ways to cut costs. This means raising costs or reducing coverage for other employees. So much for Mr. Obama's claim that if you like your coverage, you can keep it—even at Fortune 500 companies.
In its employee note, Verizon also warned about the 40% tax on high-end health plans, though that won't take effect until 2018. "Many of the plans that Verizon offers to employees and retirees are projected to have costs above the threshold in the legislation and will be subject to the 40 percent excise tax." These costs will start to show up soon, and, as we repeatedly argued, the tax is unlikely to drive down costs. The tax burden will simply be spread to all workers—the result of the White House's too-clever decision to tax insurers, rather than individuals.
A Verizon spokesman said the company is merely addressing employee questions about ObamaCare, not making a political statement. But these and many other changes were enabled by the support of the Business Roundtable that counts Verizon as a member. Verizon CEO Ivan Seidenberg's health-reform ideas are 180 degrees from Mr. Obama's, but Verizon's shareholders and 900,000 employees and retirees will still pay the price.
Businesses around the country are making the same calculations as Verizon and no doubt sending out similar messages. It's only a small measure of the destruction that will be churned out by the rewrite of health, tax, labor and welfare laws that is ObamaCare, and only the vanguard of much worse to come.
1b)Reconciling Mr. Nelson : The 60th vote for ObamaCare tries to cover his tracks
The Senate began work Tuesday on the House's "reconciliation" bill that will add even more taxes and spending to ObamaCare. Guess who's already declared himself firmly, forthrightly, unabashedly in opposition?
None other than Ben Nelson, who on Christmas Eve became the most famous Nebraskan not named Buffett when he cast the 60th and decisive vote for the Senate health-care bill. The House ratified that legislation on Sunday, and after President Obama signed it on Tuesday it is now the law of the land. Had Mr. Nelson voted no or even delayed the debate past the special Massachusetts Senate election, the bill would have died. So it's not too much to say that Mr. Nelson personally made ObamaCare happen.
Yet that bill has turned out to be wildly unpopular, not least in his home state. You'll recall that Mr. Nelson had insisted on the Cornhusker Kickback to secure his vote—$100 million to cover the state's new Medicaid costs—but Nebraska state voters hated the overt bribery.
Mr. Nelson then disavowed his own kickback, and the White House tried to ease his pain by applying that same lagniappe to . . . every other state! That is adding $30 billion more to the ObamaCare tab via the reconciliation fix, so Democrats looked around for more revenue and added a new 3.8% tax on investment income of taxpayers making more than $200,000. Thanks again, Ben.
Nebraska Attorney General Jon Bruning was among 13 AGs who within minutes of President Obama's signature yesterday had sued to derail the law.
The third-term Democrat is nothing if not resilient, however, and on Monday (after the decisive House vote) he became among the first in his party to come out against reconciliation. Mr. Nelson declared that he's especially troubled about the payroll tax he helped to facilitate, not to mention the various "add-ons" that have pushed "the total cost of health reform up billions of dollars." Heaven forbid the cost would be more than the $871 billion he supported in December.
As a political matter in the Senate, Mr. Nelson's new opposition is irrelevant. Majority Leader Harry Reid needs only 50 votes (plus Joe Biden) to overcome Republican challenges to the bill, so he can let Mr. Nelson take a walk whenever he wants. In fact, this is a major political goal of reconciliation: Let vulnerable Democrats take a pass on the toughest votes, such as new taxes and Medicare cuts. Then they can tell their constituents that they voted against ObamaCare after they voted for it.
By the way, the reconciliation bill will also nationalize the private student loan industry, which employs thousands of Nebraskans. By voting against reconciliation, Mr. Nelson will claim he has defended his home-state workers, even though the White House and Nancy Pelosi deliberately added the student-loan takeover to help the Christmas Eve Senate bill get through the House. Perhaps the newly jobless can go into health care.
Arkansas's Blanche Lincoln has also come out against reconciliation, and expect more Democrats to follow, even if every one of them enabled it on Christmas Eve. But hold a special place in your memory for Mr. Nelson, without whom none of this would be possible
1c)Repeal the Democrats: Republicans may not repeal the health-care bill, but they should repeal the Democrats.
By DANIEL HENNINGER
All day Sunday and into the night, Republican House Members tilted at the Democratic Party's mammoth health-care windmill. Amid the Stupaks and Neugebauers, Wisconsin Republican Paul Ryan finally told the chamber the truth. This debate wasn't just about doctors and insurance, he said. "This is ultimately about what kind of country we are going to be in the 21st century."
Signing the bill into law Tuesday Mr. Obama also stepped away from his windmill to say something real: "Today we are affirming . . . a truth every generation is called to rediscover for itself, that we are not a nation that scales back its aspirations."
Daniel Henninger says Republican opposition to ObamaCare has resurrected the party.
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Podcast: Listen to the audio of Wonder Land here. .
Indisputably correct. The U.S. has produced generations of upward strivers and competitors. Since 1950 til now, 82 of 150 Nobel laureates in medicine have been from the U.S. With enactment of this law, the U.S. will throttle down. Rather than spend our energies this century competing straight up with rising Asia for economic primacy, we'll work to pay for the fat but happy social-welfare state of the last century.
Or maybe not.
Spring renewal and baseball's new season are upon us, so let's quote the optimism of Yogi: It isn't over until it's over. I thought 10 p.m. to 11 p.m. Sunday night in Washington was the Republican Party's finest hour in a long time. When the voting stopped, the screen said the number of Republicans voting for Mr. Obama's bill was zero. Not one. Nobody.
Pristine opposition is being spun as a Republican liability. It looks to me like a Republican resurrection. The party hasn't yet discovered what it should be, but this clearly was a party discovering what it cannot be.
Put it this way: If you produce a bill that Olympia Snowe of Maine cannot vote for, you have not produced legislation "for the generations." You have not even produced legislation that is liberal. You have produced legislation from the left. You have produced once-in-a-lifetime legislation that no Republican from any constituency across America could vote for.
Finally, we are achieving real political definition.
The Democrats are now the party of the state. The 20th century hybrid version of the Democratic Party, which included private-sector industrial unions and Wall Street liberals, is being abandoned by its leadership as unwanted and increasingly unnecessary.
Richard Trumka, the former head of the mine workers' union who now runs the AFL-CIO, had to get an 11th hour White-House reprieve from his own party's desire to get financing for their legislation by taxing many of his largely private-sector union members' Rolls-Royce insurance plans. Time was, the party existed to protect those private unions; now it's optional.
To make up for not being able to expropriate health-care cash until 2018 from the remnants of the old industrial unions, the Democrats conjured a 3.8% "Medicare tax" on higher-bracket investment income. Democrats and Mr. Obama defended the investment taxes as "fair-share" social justice. Much of Wall Street has been notable for its private philanthropy across an array of liberal and cultural causes, but now "giving back" means a pipeline hooked straight into the federal budget. Congressional staff will decide who gets what.
Liberals in the private sector have to come to grips with the fact that what they do for a living is an abstraction to the people they are sending to Washington. Nobody at the top of the party is much interested in them anymore. House and Senate Democrats hammered insurance, pharma and medical-device makers with taxes and intimidation. It wasn't just politics. It was belief. With this bill, the party made the transition from market unionism to Alinskyism, from a politics tempered by the marketplace to one that milks the marketplace.
By default more than design, the Republicans now find themselves the party of the private economy. Their members, even in faraway Maine, should figure out how to align themselves with the interests of what is still the world's most dynamic economy.
The GOP is being counseled to abandon its morning-after impulse to "repeal the bill." Why do that? This is the first honest emotion the party has had in years. Yes, technical repeal isn't remotely possible until after 2012. But "Repeal!" is a terrific bumper sticker and campaign slogan for our times. Repeal! ObamaCare is just a start. Can't repeal the bill yet? Drive people to November's polls to repeal the Democratic Party and what it has turned into.
On Monday morning, the Service Employees International's Andy Stern, a big winner, said, "This is not a bad debate to have." He's right, and on Sunday the Republican Party found its footing to have that debate. It lost a battle, but with its total rejection of this huge entitlement, it also lost its spendthrift reputation. Now its members need to think hard about an answer for their own good question, What kind of country do we want?
1d)Student-Loan Shenanigans: Democrats assist their nonprofit friends
President Obama and Congressional Democrats have been criticized for being antibusiness. But Washington is about to bestow a huge gift upon one particular type of business—the type that doesn't pay taxes.
Despite bipartisan opposition, this week the Democrats hope to use budget reconciliation in the Senate to ram through changes to the health-care bill the House passed on Sunday. Coming along for the legislative ride is a federal takeover of the student-loan market.
On the heels of recent changes in the law that discourage private loans to students, the new reconciliation bill includes a ban on private companies originating federally guaranteed loans. All such loans will now come directly from the U.S. Department of Education.
This plan is hitched to ObamaCare for several reasons. For one, the student-loan takeover could never attract a filibuster-proof 60 votes if it had to pass as a stand-alone measure, and it might not even get 51. The government's bogus accounting for student loans also creates the illusion that this bill will help save enough money in the first five years to protect the ObamaCare provisions from Republican challenges under budget rules. Remember, budget reconciliation is supposed to be about preventing deficits, so it takes a mother lode of accounting gimmicks to claim that the bill's spending binge is a cost-saver.
Part of this reconciliation fairy tale is that cutting out the private-lender middlemen will save billions every year as students borrow directly from the feds. But while Democrats are eliminating a revenue stream at for-profit companies, they are simultaneously creating another one for a handful of favored nonprofit companies.
Currently, for loans that the government makes directly to students, the Department of Education conducts competitive bidding and hires private companies to service the loans. But in the pending bill, several dozen nonprofit firms will be eligible to receive no-bid servicing contracts on up to 100,000 student accounts for each firm.
Which nonprofit organizations will qualify? California's ALL Student Loan looks to be a big winner, thanks to language written by Representative George Miller of California. ALL Student Loan may have helped its cause by retaining the services of Vincent Reusing, a lobbyist whom the Chronicle of Higher Education has described as a "personal friend" of Mr. Miller.
"The person that any lender chooses to be their lobbyist is irrelevant to Chairman Miller," says Rachel Racusen, a spokesman for Mr. Miller. She adds, "Under this legislation, nonprofit lenders will be required to meet the same high-quality servicing standards as for-profit lenders, including measures of borrower satisfaction."
To be fair to Mr. Miller, his track record suggests that he favors assaults on profit-making businesses whether or not his friends are lobbying him. It's also true that Mr. Reusing has been very friendly to more than one left-leaning politician over the years. According to OpenSecrets.org, Mr. Reusing has contributed more than $80,000 to various Democratic campaigns, including Mr. Miller's.
The nonprofit companies set to benefit from this reconciliation earmark clearly enjoy broad support in the Democratic caucus. And you thought Democrats didn't like business.
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2)Higher Prices Make Box-Office Debut:Tickets Get Costlier as Movie Chains Seek to Capitalize on Consumers' Willingness to Pay More for 3-D ..
By LAUREN A.E. SCHUKER And ETHAN SMITH
Major U.S. movie-theater chains, seeking to capitalize on the surge in revenues fueled by such 3-D hits as "Avatar" and "Alice in Wonderland," are imposing some of the steepest increases in ticket prices in at least a decade.
The new prices take effect Friday in many markets across the country in theaters owned by such major exhibitors as Regal Entertainment Group, Cinemark Holdings Inc. and AMC Entertainment Inc.
The increases, in one case as much as 26%, vary from theater to theater, but many cinemas are raising prices most—or even solely—for 3-D showings, which accounted for the vast majority of last year's 10% jump in domestic box-office sales. 3-D movies accounted for 11% of domestic ticket sales in 2009, up from just 2% in 2008.
At an AMC theater in Danvers, Mass., a Boston suburb, 3-D ticket prices are jumping more than 20% to $17.50 from $14.50, while the adult admission price for a conventional film will remain at $10.50. At one Seattle multiplex, adult admission is rising to $11 from $10 for a conventional film, to $15 from $13.50 for a regular 3-D showing and to $17 from $15 for Imax 3-D.
A 3-D Imax movie at New York City's AMC Loews Kips Bay will cost $19.50, up from $16.50.
The increases weren't officially announced by the theater operators, but were reflected in prices posted Wednesday on movie-ticketing Web sites, such as Fandango.com.
AMC and Cinemark declined to comment. Comment from Regal wasn't immediately available.
Their moves come on the heels of a record-setting year at the domestic box office, with revenue surpassing $10 billion for the first time. Movie attendance in the U.S. and Canada grew 5.5% in 2009, to 1.42 billion, the highest level since 2004. Ticket sales so far this year are up nearly 10% from a year earlier.
Movie theaters typically had charged $2 to $3 extra for 3-D tickets. But the brisk demand for those premium-priced tickets led many exhibitors to believe that they were underpriced.
About 83% of the record $2.6 billion in ticket sales for "Avatar" came from 3-D and Imax screens. And Walt Disney Co.'s "Alice in Wonderland" also set records when it hit 3-D screens earlier this month.
While the price increases could boost theater owners' already buoyant revenues, some industry watchers think the could also spark a consumer backlash. Studios, theater operators and trade groups have long touted films as a bargain, compared with other forms of entertainment, intensifying their pitch during the recession.
A decade ago, the average ticket at a multiplex was $5.39, but prices have edged up between 2.7% to 6.1% a year since then, according to the Motion Picture Association of America.
"The U.S. economy isn't in the greatest shape, and there is definitely risk here in pushing price too far in a weak economy," said Richard Greenfield, a media analyst at BTIG LLC, who issued a research report Wednesday on the price hikes.
Mr. Greenfield said the next month will serve as a test of the strategy. "We'll have a sense if there is any pushback" from moviegoers, he said.
Some movie-studio executives expressed concern that the price increases might be too much too soon. "The risk we run is that we will no longer be the value proposition that we as an industry have prided ourselves on," said a distribution executive at one major studio, who added that he was worried movies would become "a luxury item."
Other studio executives agreed that the move was risky, but some, like Dan Fellman, president of domestic distribution for Time Warner Inc.'s Warner Bros., expressed support. "The exhibitors are trying to push the needle on ticket prices and see where it ends up," he said in an interview. "Sure, it's a risky move, but so far charging a $3 or $4 premium has had no effect on consumers whatsoever, so I'm in favor of this experiment to raise prices even more. There may be additional revenue to earn here."
Studios are also in a bind. While many are wary of appearing to gouge consumers beset by a weak economy, they are also facing higher costs as they produce more movies in the technology-heavy 3-D format. Though ticket prices are set by theater operators, the proceeds are split roughly 50-50 with movie studios.
Five major 3-D films are opening in theaters over the next three months, starting this weekend with DreamWorks Animation SKG Inc.'s "How to Train Your Dragon." That rich selection is one reason theater owners chose to raise 3-D ticket prices now. It may also help set consumers' expectations for future 3-D films.
Price Compaisons:
A sampling of moviue tickets at selected theatres in major cities for Friday,March 26
.Imax 3-D tickets to "Dragon" are expected to cost an average $1, or 7%, more than Imax tickets to Disney's "A Christmas Carol," the last children's film to open in the format, just a few months ago.
In his report Wednesday, Mr. Greenfield said one of the biggest price increases was at an AMC theater in Boston, where the price of a child's 3-D Imax ticket is rising to $14.50 from $11.50.
In the 10 markets surveyed by Mr. Greenfield, adult tickets to conventional 2-D films were set to rise by an average of 4%, beginning this weekend. Price increases on 3-D movies are at least twice as steep, he said, with adult admission prices rising an average 8% for 3-D movies and nearly 10% for movies on Imax screens.
"This is a truly unique event for the movie industry," said Mr. Greenfield. "I can't remember the last time I saw such a major change in ticket pricing
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4)This is why we fear what the cost of Health Care will truly be...Social Security to See Payout Exceed Pay-In This Year
By MARY WILLIAMS WALSH
The bursting of the real estate bubble and the ensuing recession have hurt jobs, home prices and now Social Security.
This year, the system will pay out more in benefits than it receives in payroll taxes, an important threshold it was not expected to cross until at least 2016, according to the Congressional Budget Office.
Stephen C. Goss, chief actuary of the Social Security Administration, said that while the Congressional projection would probably be borne out, the change would have no effect on benefits in 2010 and retirees would keep receiving their checks as usual.
The problem, he said, is that payments have risen more than expected during the downturn, because jobs disappeared and people applied for benefits sooner than they had planned. At the same time, the program's revenue has fallen sharply, because there are fewer paychecks to tax.
Analysts have long tried to predict the year when Social Security would pay out more than it took in because they view it as a tipping point the first step of a long, slow march to insolvency, unless Congress strengthens the program's finances.
When the level of the trust fund gets to zero, you have to cut benefits, Alan Greenspan, architect of the plan to rescue the Social Security program the last time it got into trouble, in the early 1980s, said on Wednesday.
That episode was more dire because the fund could have fallen to zero in a matter of months. But partly because of steps taken in those years, and partly because of many years of robust economic growth, the latest projections show the program will not exhaust its funds until about 2037.
Still, Mr. Greenspan, who later became chairman of the Federal Reserve Board, said: I think very much the same issue exists today. Because of the size of the contraction in economic activity, unless we get an immediate and sharp recovery, the revenues of the trust fund will be tracking lower for a number of years.
The Social Security Administration is expected to issue in a few weeks its own numbers for the current year within the annual report from its board of trustees. The administration has six board members: three from the president's cabinet, two representatives of the public and the Social Security commissioner.
Though Social Security uses slightly different methods, the official numbers are expected to roughly track the Congressional projections, which were one page of a voluminous analysis of the federal budget proposed by President Obama in January.
Mr. Goss said Social Security's annual report last year projected revenue would more than cover payouts until at least 2016 because economists expected a quicker, stronger recovery from the crisis. Officials foresaw an average unemployment rate of 8.2 percent in 2009 and 8.8 percent this year, though unemployment is hovering at nearly 10 percent.
The trustees did foresee, in late 2008, that the recession would be severe enough to deplete Social Security's funds more quickly than previously projected. They moved the year of reckoning forward, to 2037 from 2041. Mr. Goss declined to reveal the contents of the forthcoming annual report, but said people should not expect the date to lurch forward again.
The long-term costs of Social Security present further problems for politicians, who are already struggling over how to reduce the nation's debt. The national predicament echoes that of many European governments, which are facing market pressure to re-examine their commitments to generous pensions over extended retirements.
The United States soaring debt propelled by tax cuts, wars and large expenditures to help banks and the housing market has become a hot issue as Democrats gauge their vulnerability in the coming elections. President Obama has appointed a bipartisan commission to examine the debt problem, including Social Security, and make recommendations on how to trim the nation’s debt by Dec. 1, a few weeks after the midterm Congressional elections.
Although Social Security is often said to have a trust fund, the term really serves as an accounting device, to track the pay-as-you-go program's revenue and outlays over time. Its so-called balance is, in fact, a history of its vast cash flows: the sum of all of its revenue in the past, minus all of its outlays. The balance is currently about $2.5 trillion because after the early 1980s the program had surplus revenue, year after year.
Now that accumulated revenue will slowly start to shrink, as outlays start to exceed revenue. By law, Social Security cannot pay out more than its balance in any given year.
For accounting purposes, the system's accumulated revenue is placed in Treasury securities.
In a year like this, the paper gains from the interest earned on the securities will more than cover the difference between what it takes in and pays out.
Mr. Goss, the actuary, emphasized that even the $29 billion shortfall projected for this year was small, relative to the roughly $700 billion that would flow in and out of the system. The system, he added, has a balance of about $2.5 trillion that will take decades to deplete. Mr. Goss said that large cushion could start to grow again if the economy recovers briskly.
Indeed, the Congressional Budget Office's projection shows the ravages of the recession easing in the next few years, with small surpluses reappearing briefly in 2014 and 2015.
After that, demographic forces are expected to overtake the fund, as more and more baby boomers leave the work force, stop paying into the program and start collecting their benefits. At that point, outlays will exceed revenue every year, no matter how well the economy performs.
Mr. Greenspan recalled in an interview that the sour economy of the late 1970s had taken the program close to insolvency when the commission he led set to work in 1982. It had no contingency reserve then, and the group had to work quickly. He said there were only three choices: raise taxes, lower benefits or bail out the program by tapping general revenue.
The easiest choice, politically, would have been solving the problem with the stroke of a pen, by printing the money, Mr. Greenspan said. But one member of the commission, Claude Pepper, then a House representative, blocked that approach because he feared it would undermine Social Security, changing it from a respected, self-sustaining old-age program into welfare.
Mr. Greenspan said that the same three choices exist today though there is more time now for the painful deliberations.
“Even if the trust fund level goes down, there's no action required, until the level of the trust fund gets to zero, he said. At that point, you have to cut benefits, because benefits have to equal receipts.
Stephanie Strom contributed reporting.
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The Reality of Obamacare
By Jonah Goldberg
First: Congratulations to President Obama and the Democratic leadership. You won dirty against bipartisan opposition from both Congress and the majority of Americans. You've definitely polarized the country even more, and quite possibly bankrupted us, too. But hey, you won. Bubbly for everyone.
Simply, you have nationalized health care by proxy. Insurance companies are now heavily regulated government contractors. Way to get big business out of Washington and our lives! These giant corporations will clear a small, government-approved profit on top of their government-approved fees. Then, when health-care costs rise - and they will - Democrats will insist, yet again, that the profit motive is to blame, and out from this Obamacare Trojan horse will pour another army of liberals demanding a more honest version of single-payer.
The Obama administration has turned the insurance industry into the Blackwater of socialized medicine.
That's what Obama always had in mind. During the now-legendary health-care summit, Obama, who loves to talk about "risk pools," "competition," "consumer choice," and the like, let it slip that he actually doesn't believe in insurance as commonly understood. The notion that Americans should buy the health-care "equivalent of Acme Insurance that I had for my car" seemed preposterous to him. "I'm buying that to protect me from some catastrophic situation," he explained. "Otherwise, I'm just paying out of pocket. I don't go to the doctor. I don't get preventive care. There are a whole bunch of things I just do without. But if I get hit by a truck, maybe I don't go bankrupt." Apparently, people are just too stupid to go to the doctor - or maintain their homes - if they have to pay much of anything out of pocket.
The endgame was to get the young and healthy to buy more expensive insurance than they need or want. "Expanding the risk pool" and "spreading out the risk" by mandating - i.e., forcing - young people to buy insurance is just market-based spin for socialist ends. A risk pool is an actuarial device where a lot of people pay a small sum to cover themselves against a "rainy day" problem that will affect only a few people. Such "peace of mind" health insurance is gone. What we have now is health assurance. With health assurance, there are no "risk pools" really, only payment plans.
Under the new law, all the exits from the system are blocked. You can't opt out or buy cheap, high-deductible Acme car-type insurance, even if that's what you need. Ultimately, even that coercion won't be enough to make the whole thing work, because the "cost curve" will not be bending.
Profit-hungry insurance companies were never the problem. (According to American Enterprise Institute economist Andrew Biggs, industry profit margins are around 3 percent, and the entire industry recorded profits of just $13 billion last year, close to a rounding error in Medicare fraud estimates.) Rather, health-care costs have been skyrocketing because consumers treat health insurance like an expense account. Putting almost everyone into one "risk pool" doesn't change that dynamic; it universalizes it. And eventually, the only way to cut costs will be to ration care.
In September, Obama got into a semantic argument with ABC's George Stephanopoulos, who noted that requiring all Americans to pay premiums for a government-guaranteed service sounds an awful lot like a tax. "No. That's not true, George," Obama said. "For us to say that you've got to take a responsibility to get health insurance is absolutely not a tax increase. What it's saying is . . . that we're not going to have other people carrying your burdens for you."
Stephanopoulos invoked a dictionary definition of a tax: "a charge, usually of money, imposed by authority on persons or property for public purposes." Obama laughed off the idea that a dictionary might outrank him as the final arbiter of a word's meaning: "George, the fact that you looked up . . . the definition of tax increase indicates to me that you're stretching a little bit right now. Otherwise, you wouldn't have gone to the dictionary to check on the definition."
Okay, put aside your dictionaries. The legislation allocates $10 billion to pay for 16,500 IRS agents who will collect and enforce mandatory "premiums." Does that sound like the private sector at work to you?
5a)Obama going to Iowa to sell health care law
President Barack Obama travels to Iowa City, Iowa, on Thursday to try to sway the public's opinion of his health care overhaul.
It's Obama's first beyond-Washington event aimed at promoting the plan since it was passed Sunday. The president signed it into law Tuesday.
The president is scheduled to speak at the University of Iowa, which is in Democratic Rep. Dave Loebsack's district. Loebsack voted for the health care bill.
Before the vote, Obama promised wavering Democrats, who primarily were moderates in conservative-leaning districts and states, that they wouldn't be left standing alone if they cast the tough "yes" votes on the bill.
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6)Editorial: Nanny state will turn U.S. into Europe
By Nolan Finley
Passage of a national health care bill begins fulfilling the fantasy of the left of making over America into something resembling its refined and compassionate European cousins.
Throughout the health care battle, President Barack Obama asked, if European nations can deliver expansive universal health care to every citizen, why can't the United States do the same. The president, an ardent Europhile, poses that question about everything from high-speed rail to cheap college tuition.
The answer is that we can -- if we're willing to live a European lifestyle.
That's a dandy thought for those who look longingly at Europe's rich social welfare programs, efficient public transportation and teeny carbon footprints.
But most Americans will chafe at giving up their personal choices and elbow room to make Euro-socialism work here. The Nanny State is anathema to our natural individualism. But once government takes over the care and feeding of its citizens, nothing is beyond its reach. France and Denmark, for example, claim veto power over baby names. A people conditioned to view the government as the dominant force in their universe accepts any government intrusion.
They also accept less of everything.
The average European has 396 square feet of living space, compared to 721 square feet for the average American. Even the poor in the United States have more personal space than the typical European.
Americans love their single-family homes, with as much green space as they can afford between them and their neighbors. In Europe, much of the population is stacked in bleak Bauhaus boxes surrounding cities glorious for their historic architecture, but where nothing of significance has been built in 50 years.
Being cramped at home helps condition them for the toy-sized automobiles mandated by Europe's high gasoline taxes. Imagine those clown cars squeezed full of Americans, who weigh on average 10 pounds more than Europeans (something we aren't so proud of, but will be remedied when government health czars start planning our menus, a la New York's salt ban).
Three-quarters of Americans own an automobile, compared to 50-60 percent in western European nations, and nearly half of us drive trucks or SUVs, a sight as rare on the streets of Europe as an honest taxpayer.
While 85 percent of Americans obey tax laws, the rate in Western Europe ranges from 60-75 percent. In Belgium, which has one of the world's biggest tax burdens, 22 percent of the economy is black market.
Who can blame them for cheating the tax man? In Europe, government spending is equal to 40-50 percent of gross domestic product, compared to 28 percent in the United States, and top tax rates reach 60 percent.
That's why Europeans don't knock themselves out earning money. Productivity gains in Western Europe are half the U.S. average, while unemployment averages twice our rate.
One thing Europe doesn't spend money on is defense. Military spending as a percentage of GDP averages less than 2 percent in Europe, compared to 4.5 percent in the United States, which accounts for 41.5 percent of worldwide defense spending.
As long as America is the world's Great Protector, European countries can afford to skimp on guns to buy butter. But if we are now to become the Great Nanny of our own people, that equation will have to change.
Yes, we can have what Europe has. But we can't have that and what America has as well.
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