How to determine the winner of the Obamacare/Medicare debate?

Redacted from the article, “Beyond Mediscare”
By Yuval Levin
The Weekly Standard, May 30, 2011

Do House Republicans want to kill the elderly? If you listen to the left these days, you’d certainly think so. Last week, a liberal advocacy group called “The Agenda Project”—which claims to advance “rational, effective ideas in the public debate”—released an ad showing a look-alike of House Budget Committee chairman Paul Ryan pushing an old woman in a wheelchair off a cliff. “Is America beautiful without Medicare?” the ad inquires of viewers. “Ask Paul Ryan and his friends in Congress.”

Nor is it only rabid interest groups that have succumbed to such appeals. Kathleen Sebelius, secretary of health and human services, said more or less the same thing earlier this month. When asked about the House Republican budget’s approach to Medicare, Sebelius said that, under the plan, “If you run out of the government voucher and then you run out of your own money, you’re left to scrape together charity care, go without care, die sooner. There really aren’t a lot of options.”

The president himself has come pretty close to this view. The Republican budget, Obama said in a speech at George Washington University last month, “says instead of guaranteed health care, you will get a voucher. And if that voucher isn’t worth enough to buy the insurance that’s available in the open marketplace, well, tough luck—you’re on your own. Put simply, it ends Medicare as we know it.”

Clearly, the GOP Medicare reform has struck a nerve. Democrats seem unwilling to speak about it honestly. Maybe they know that the facts do not support their case.

Let’s start with “Medicare as we know it.” According to the Congressional Budget Office and Medicare’s trustees, the program has a long-term unfunded liability of more than $30 trillion. It’s about a decade from insolvency. The trustees’ latest annual report, released on May 13, notes that the Medicare trust fund is projected to run out of money five years sooner than was projected last year. Its current trajectory would swallow up the federal budget. Taxes could not be raised high or fast enough to keep up with its growth without crushing the economy.

The Democrats cannot deny the figures, but their solution is to let the crisis come. President Obama’s budget offered nothing beyond Obamacare as a solution. In an extraordinary letter affixed to the recent trustees’ report, Medicare’s chief actuary noted that Obamacare’s approach to the program—price controls determined by a board of experts and devoid of market-based reforms that could help health care providers improve their efficiency—would actually exacerbate Medicare’s troubles.

The Republican budget offers precisely such market-based reforms. It proposes not just to reduce the growth rate of Medicare spending, but to introduce consumer pressures into the system that would create financial incentives for providers to work more efficiently and reduce the growth of the health care costs that are at the heart of the problem.

Currently Medicare recipients play no part in determining who gets paid and how much, and have no sense of what their health care costs. Providers have no financial incentive to deliver better care at lower prices. And price controls that would reduce what Medicare pays per service (the Obamacare solution) would only create an incentive for providers to supply a greater volume of services to make up the difference. That is exactly what price controls have done in the past—drive efficiency down and costs up.

The House Republican proposal would change Medicare’s counterproductive design. It would leave today’s seniors and those now 55 or older in the current system, since they have planned their retirements around it. But everyone younger than that would join a redesigned Medicare when they retire.

Rather than pay all providers a set fee directly, seniors would use the money (in the form of a premium support payment that would start at current Medicare rates and grow with inflation) to choose insurance plans from a menu of guaranteed private coverage options. Poor seniors and those in the worst health would get significantly greater support, while the wealthiest would receive less.

And seniors would be buying guaranteed insurance with limits on out of pocket costs, not paying directly for care. Sebelius’s notion that they would simply “run out” of money if they got sick is nothing more than fear-mongering.

Insurers and providers would compete for seniors’ dollars. They would be free to find innovative ways to offer better quality at lower costs. That’s how markets produce efficiency: by letting sellers find ways to offer buyers what they want at prices they want to pay. Everyone agrees that such efficiency improvements are essential. As Ryan has put it, the basic choice offered by the parties’ competing approaches to Medicare has to do with how efficiency is achieved. It’s a choice between giving a board of experts the power to deny care to seniors based on its magisterial judgment of quality and value, and giving seniors the power to deny business to providers based on their individual opinions and priorities.

For politicians, it is also a choice between reforming a program that seniors are comfortable with and leaving it alone despite its fatal problems. Republicans have chosen to deal with that difficulty by leaving current seniors with all the benefits they are accustomed to in the current program and reforming it for the next generation.

Democrats have chosen to deal with it by pretending there is no problem, falsely insisting that any reform will harm today’s seniors, and leaving a colossal disaster for the next generation. Republicans, in other words, have chosen a policy solution that carries political risk while the Democrats have opted for political advantage.

Why our economy and ability to compete are in the tank

Obama’s team has job, economy and liberty destroyers at every position

Video below article: Analysis of US economic crisis
By Mort Zuckerman, Chairman and editor in chief of US News & World Report and publisher of the New York Daily News

Chief destroyer, Obama aided and abetted by:
Ken Salazar, Kathleen Sebelius, Barney Frank, Carl Levin

By Richard W. Rahn
The Washington Times
April 25, 2011

Which two have done more to improve your life – Thomas Edison and Steve Jobs, or Barack Obama and Nancy Pelosi? Some people, in their pursuit of profit, benefit their fellow humans by creating new or better goods and services, and then by employing others. We call such people entrepreneurs and productive workers. Others are parasites who suck the blood and energy away from the productive. Such people are most often found in government.

Perhaps the most vivid description of what happens to a society where the parasites become so numerous and powerful that they destroy their productive hosts is Ayn Rand’s classic novel “Atlas Shrugged.” The just-released movie version is an entertaining, tension-filled struggle between the productive and the parasites who ally themselves with the envious and evil. Go see it.

When wages are rising faster than inflation (i.e., real wages), and the number of adults, as a percentage of the population at work, is rising, times are good; but when real wages fall, misery results.

For the past several months, real wages have been falling, and despite the small improvement in the unemployment rate, the adult population/worker ratio continues to fall. Declines in prosperity most often are a result of bad policies rather than natural forces, with the rare exception of an event like the Japanese earthquake and tsunami.

Bad policies come about from the actions of specific people – individuals in Congress and government agencies – not the Congress or the administration as a whole. Washington is filled with people who are more destructive than constructive. It is useful to name some of the most destructive people in the hope that they will either reform or leave.

One of Washington’s most aggressive destroyers of jobs has been Rep. Barney Frank, the Massachusetts Democrat who is a former head of the House Financial Services Committee and principal author of the now-notorious Dodd-Frank Act. He was one of main protectors and enablers of Fannie Mae and Freddie Mac as they went on their ruinous, subprime mortgage buying binge.

Peter Wallison, former general counsel of the U.S. Treasury and member of the Financial Crisis Inquiry Commission, has produced a lengthy report showing how the actions of Fannie and Freddie were the most important causes of the financial crisis. If Mr. Frank and his Senate counterpart, disgraced former Sen. Christopher J. Dodd, Connecticut Democrat, had acted responsibly, millions of Americans might not have lost their jobs and homes over the past few years.

Interior Secretary Kenneth L. Salazar, a former senator, has done more to destroy and curtail American oil, gas and coal production than any other single human. Soon after taking office, he prohibited oil and gas production in huge areas of the American West. He has held up the permitting of both offshore and onshore oil production well beyond what was necessary to ensure safety. He has ignored sound science and the rule of law. His actions, even according to Democrat senators and others, have cost hundreds of thousands of American jobs.

Health and Human Services Secretary Kathleen Sebelius was caught in a half-trillion-dollar lie last month, when, before a House Committee, she was finally forced to admit that the administration had been double-counting Medicare savings as critics had been claiming. If Ms. Sebelius and others in the administration had told the truth, Obamacare would never have passed. The costs associated with this piece of legislation, not even considering the costs of all of the legal challenges, will result in millions of job losses and a loss of personal and economic freedom – unless the Supreme Court upholds the legal challenges.

President Obama claimed last week in his budget speech that hundreds of billions of dollars can be saved in the Medicare program by eliminating waste, fraud and abuse. If that is true, why has he tolerated Ms. Sebelius’ mismanagement?

Sen. Carl Levin, Michigan Democrat, has done much to drive foreign investment and jobs out of America. He has done this by leading a headline-grabbing, but economically illiterate, crusade against legal tax avoiders, tax evaders and low-tax jurisdictions.

His destructive “solution” has been to put costly and punitive restrictions on domestic and foreign financial institutions. These restrictions have caused some foreign financial institutions to cease investing in the United States and to refuse opening accounts for Americans. It has been explained to Mr. Levin that his previous and newly proposed legislation is driving upwards of $1 trillion of foreign investment out of the country, which will cause Treasury to lose, in the real world, many times the tax revenue Mr. Levin and his gang of know-nothings claim.

But Mr. Levin carries on, leaving America with far less foreign investment and the jobs it would create – all in a selfish attempt to curry favor with the witless media.

Finally, we have the job-destroyer-in-chief, Mr. Obama. Even though the empirical evidence shows that both job creation and liberty increase with reductions in the size of government and tax rates, the president has done just the opposite.

Last week, without offering an alternative budget plan of his own, the president had the unmitigated gall to attack House Budget Committee Chairman, Paul Ryan, who has a serious plan to deal with the budget crisis. However, Mr. Obama did call for a big tax increase on those who create jobs. If that happens, prepare for double-digit unemployment.

Richard W. Rahn is a senior fellow at the Cato Institute and Chairman of the Institute for Global Economic Growth.

Click to view the Mort Zuckerman video.

And watch as interviewer desperately tries to put words in Mort’s mouth. We must have been watching MSNBC or CNN or TBS or any number of the other of the Left wing press. I am sure they were sorry that asked him for his point of view. jsk