How Obama's Multifarious Plans Threaten the Economy 14 comments
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OK, I'm convinced: President Obama has a remarkable attention span. Too bad the rest of us can't keep up.
Obama is fond of saying that the government can do several important things at once, and he seems determined to prove it. Unprecedented financial bailouts are still in the works, and $787 billion in stimulus money is just starting to filter into the economy, but that's no reason to sit back and take a breather. A new healthcare reform plan would transform one sixth of the U.S. economy. Obama's "cap-and-trade" plan would be the biggest American response to global warming to date. His financial reform plan would rewrite the rules for Wall Street and transform lending. In his spare time, Obama is recalibrating the nation's two wars, winding down our presence in Iraq while ramping it up in Afghanistan.
Got all that?
Probably not. Obama is certainly right that the federal government, with a $3 trillion budget and 1.8 million employees, is capable of multitasking. But Americans need to be able to follow along, and Obama's multifarious plans are outstripping the ability of citizens—even those determined to stay informed—to understand what he's doing. The fire-hose agenda is starting to threaten initiatives like financial reform that ought to have mainstream support, and undermining Obama's overall political standing.
The political calculus, of course, is that Obama needs to emulate Franklin Roosevelt and push through as many transformative programs as possible while he still has momentum from his historic presidential victory. Except that this isn't the 1930s and the FDR cram-down approach could alienate key parts of Obama's constituency.
Take small-business owners. They ought to be the biggest fans of healthcare reform, since companies with fewer than 50 employees typically face the highest costs for providing insurance to their workers. But Obama has been focused on so many things that he's blown the chance to get small-business owners squarely in his corner on healthcare.
It's hard to know exactly how "Obama's plan" would treat small business, since the president's plan so far is nothing more than a set of principles, with few specifics. But if somebody who owned a small business took a few hours off from a 60-hour workweek to read through half-a-dozen legislative proposals banging around Congress, he or she might discover plans to impose new fees on certain small companies and even penalize them if they don't offer insurance under the new scheme. So the small-business interest groups in Washington are criticizing Obama's plan instead of endorsing it. And new healthcare costs would come on top of other new fees the same businesses might have to pay under the totally separate and thoroughly mystifying cap-and-trade plan. Maybe small-business owners would get something valuable in exchange for these fees, but so far the president hasn't made a convincing case; he's leaving the details to Congress, you see.
Meanwhile, other parts of the Obama administration have been drafting plans to strengthen oversight of the financial system and rein in firms that take the most outlandish risks. Better financial regulation ought to be a slam-dunk in the aftermath of a brutal recession caused by rapacious banks looking out for nobody but themselves. But not so fast. The U.S. Chamber of Commerce, which represents the interests of big and small businesses alike, now opposes a new Consumer Financial Protection Agency that Obama wants to establish, saying it could harm any business that extends credit to customers. True? A canard? A bit of public discussion and digging by the media ought to air out the pros and cons. So let's try to schedule that right between the national debate on a public health-insurance plan and a primer on pollution credits.
Inside the beltway, dozens of lobbying firms and special-interest groups have plenty of surge capacity to deal with a hyperactive government. The rest of us don't. So while the interest groups crank out policy papers and talking points and dubious infomercials, working Americans get deluged with information faster than they can digest it. It's an ideal environment for selling malarkey like "death panels" and absurd visions of jackbooted government auditors: Propagandists focus on harried people scared by the recession and tell them something that stokes their fears, banking on a steady stream of new schemes out of Washington to keep people from digging too deep into any one issue.
Obama might slow the pace of rampant reform so we could work through one issue before moving on to the next. First should be financial reform, while the ravages of greedy banks are still a fresh memory. There's so much healthcare to reform that it could easily be broken into two parts and spread out over Obama's four-year term, with cost control coming first and expanded coverage coming after we've made some headway on the first issue. Global warming is an important problem we need to address, but waiting a year or two might be more prudent than forcing another mandate onto businesses while the economy is still weak, which risks killing the idea for good. And oh yeah, maybe Obama could shrink that mushrooming deficit before coming up with new ways to spend money.
But politics, not logic, dominates the agenda in Washington, so we're likely to get a slate of laws that could transform large chunks of the economy even though they're drafted by just a few beltway mandarins, with little genuine input from voters. At least we know there will be plenty of Obama speeches, explaining it all.
Disclosure: no positions
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It is a bit sad that government can even be more efficient and healthy for us than this system crafted to benefit attorneys, insurance, and health conglomerates. But alas, they have massive amounts of money to blow defending their system and, like all insurance save maybe AIG, they can pass it on to their customers in another 5-7% annual cost increase no one can afford.
You are right businesses should solidly side with reform. However, considering business is usually the loser in most government ideas I can easily understand their hesitance to endorse universal healthcare. What is painfully clear is that US businessmen need this monkey off their back if they hope to compete globally in the future.
While making a political miscalculation, Obama believes he has caudillo like authority to impose his warped and statist vision on a shocked, frightened and miserable people who have recently awakened from a coma of consumption. Having lost $14 trillion, along with hopes, dreams and aspirations, they are viewed as vulnerable to the siren call of the big loving state.
Amid economic chaos, Obama want to introduce sweeping reforms in financial services, healthcare, energy and environment to redress perceived social and economic inequities and further consolidate state control over industry. For whatever reason, media and some in the financial sector have always been sympathetic to his progressive ideals; these new measures will bring big oil and most manufacturing under the firm grip of Washington.
It is essential to understand, though, this is all about power and control; improvements in lives and the broader economy are secondary. With direct and indirect control over most of the economy, the enlightened ones will be able to pursue whatever agenda even if it means running the economy into the ground.
2. Health care
These reforms are urgent.
Global warming is a false issue and needs to be discarded immediately. If we want to be honest and say this is an issue simply about cleaning up the enrionment, then it is an important issue, I agree. But this fake 'global warming' moniker -- now apparently the Earth is cooling, so we're calling it 'climate change'... Man cannot control the Earth's climate. Man is smaller than the earth. The Earth evolves man. There is no greater intellectual hubris than this 'global warming' idea. If we no anything about Nature, we know that Nature is guided by cycles. Nature gets cold, Nature gets hot; Nature gets dark, Nature gets light. There are small patterns, Day and Night; there are larger patterns, Summer and Winter. The Sun goes through a cycle in 25,000 + years. We don't know nearly enough to say what the Earth is supposed to be and what form the Earth is supposed to take. It's an arrogant assumption on our part. It may be that humanity will be wiped off the Earth by a great heat or a great cooling. But life won't stop probably, until its ready to stop. It's ludicrous to say that man is causing global warming when every planet in the solar system is experiencing global warming. It's more likely that the Sun has something to do with it.
As far as Obama: he is not the Devil. He is not the great demonic force hoping to turn America into Russia. Any more than FDR was. And the Republicans only have themselves to blame. They caused this crash with their insistence that business was responsible enough to police itself, that greed would not get in the way, that self-interest would be muted and national interest would supercede in a choice between greed and self-destruction or lower profits and social responsibility. Greed won out. Business has proven itself, again, to be incapable of delivering an ethical restraint in the mad rush to line one's pockets. That's why government has to police business, as much as we'd like that to not be the case (I would like that also. I voted for Reagan and the Bushes. But I see now that people motivate only by money cannot change their stripes: their own pocketbook ALWAYS comes first.)
-AM
On Sep 15 06:21 AM Michael Clark wrote:
> 1. Corporate reform
> 2. Health care
>
> These reforms are urgent.
>
> Global warming is a false issue and needs to be discarded immediately.
> If we want to be honest and say this is an issue simply about cleaning
> up the enrionment, then it is an important issue, I agree. But this
> fake 'global warming' moniker -- now apparently the Earth is cooling,
> so we're calling it 'climate change'... Man cannot control the Earth's
> climate. Man is smaller than the earth. The Earth evolves man. There
> is no greater intellectual hubris than this 'global warming' idea.
> If we no anything about Nature, we know that Nature is guided by
> cycles. Nature gets cold, Nature gets hot; Nature gets dark, Nature
> gets light. There are small patterns, Day and Night; there are larger
> patterns, Summer and Winter. The Sun goes through a cycle in 25,000
> + years. We don't know nearly enough to say what the Earth is supposed
> to be and what form the Earth is supposed to take. It's an arrogant
> assumption on our part. It may be that humanity will be wiped off
> the Earth by a great heat or a great cooling. But life won't stop
> probably, until its ready to stop. It's ludicrous to say that man
> is causing global warming when every planet in the solar system is
> experiencing global warming. It's more likely that the Sun has something
> to do with it.
>
> As far as Obama: he is not the Devil. He is not the great demonic
> force hoping to turn America into Russia. Any more than FDR was.
> And the Republicans only have themselves to blame. They caused this
> crash with their insistence that business was responsible enough
> to police itself, that greed would not get in the way, that self-interest
> would be muted and national interest would supercede in a choice
> between greed and self-destruction or lower profits and social responsibility.
> Greed won out. Business has proven itself, again, to be incapable
> of delivering an ethical restraint in the mad rush to line one's
> pockets. That's why government has to police business, as much as
> we'd like that to not be the case (I would like that also. I voted
> for Reagan and the Bushes. But I see now that people motivate only
> by money cannot change their stripes: their own pocketbook ALWAYS
> comes first.)
On Sep 15 07:12 AM atlasman wrote:
> I am in the small biz camp and after looking at the bills, my partner
> and I have decided to outsource and 1099 all employees until the
> dust settles. I know at least one other small tech biz going the
> same route. Obama might not be the devil, but he has no clue how
> the real world works and should go back to community organizing.
>
>
> -AM
I wrote some healthcare software for a client, and you'd be surprised how much inefficiency there is for doctors just because they can't communicate with the same standard. I support government doing what it does best (except for the Reinvestment Act, entitlements, etc.) , and that is creating a standard. We've forgotten that. If all private insurance was for supplementals, and the government created a simplified basis (the pain pill/death panel-for-anything-exp... version) that would simplify IT, communication, and reduce waste and cost.
Obama wants to concentrate power in Washington, one of the places HE denigrates constantly. Small business has a burden of overhead for this crap, especially with "I'll fine you if you don't give insurance to all employees." In the IT business, which I'm in, I would rather have portable insurance that I pay for myself, but instead I'm forced to switch every 6 months, and incur overhead along with my employer. Every switch also leaves me uninsured for 30-60 days.
The TRUE cost of healthcare has to include the time spent administering it, paying it, accounting, and explaining it to employees.
That's why ObamaCare is bad for I.T. businesses.
On Sep 15 08:54 AM Michael Clark wrote:
> Please explain how Obama's policies forced you to make these hard
> decisions, opposed to just us being in a depression he certainly
> did not cause.
"Green jobs cannot be exported ."
Why ?
Because nobody else wants them !
These are all job killers. No business is going to invest in workers until they understand what their costs are going to be. These deficits will lead to higher taxes and more inflation. How do you pay for a new entitlement when those we have are under funded. Then you stand on television and say he will pay for it with cuts on a under funded program. Mr. Newman is right, Obama should focus and fix what he can. Could use a big shot of humility.
And he believes he can out stubborn everyone else.
This is not going to lead to good results.
A year from now he'll be looking like a one term president.
As far as small businesses go (and many large), have there been studies on how effective health care reform would impact Workmen's Comp rates? Small business owners, of all people, should be all over this! Obviously small businesses would benefit from single payer (hospitalization being by far the biggest expense when injuries occur), but how do other countries and their different systems manage, and are we studying other, more successful systems? Is there an optimum mixture of private and public components of a health care system that economists and economic advisers should be studying?
As the population in this country ages, with less workers supporting more retirees, should there be more structural framework to keep workers healthy and producing? Not just in the interests of the workers themselves, but also in the interests of the retirees, and in the interests of all tax payers (spreading the burden) and specifically in this discussion, investors. The companies you invest in need labor or they fold and you lose money. The Harvard study showing 45,000 deaths per year caused by lack of health care, which they said did not include people who had health insurance but were denied care (are there stats on this figure?); so using both those groups of people, are there studies showing the economic costs and benefits of different structures to keep workers healthy and producing/contributing v. the loss of them? I believe the Harvard study showed 540,000 deaths of just the uninsured over 12 years, so each of their salaries and taxes --and then there's profit for pharmaceutical companies and investors: *poof* And then if we don't find the correct balance of public and private coverage (as other countries have), more profit *poof* Isn't there a place for lots of new little profits v. dead thus unproductive workers?
One of my jobs is with a big service/company (and they are maniacs about Workmens Comp, BTW); my second job is with a type of construction company. Workmen's Comp is by far the largest expense, and the hardest to deal with. Even though the company has never had a claim, you must have this insurance to even bid jobs. A bad year following a good year or years really catches many small businesses short. Many companies went under owing money to the insurance company, and to suppliers. So the small business has been restarted after years of inactivity because there is still some demand for work that had been performed by all the companies that went bankrupt. I guess all this puts me in a position to think of a lot of annoying questions regarding health, insurance, and the economy....!
To the person issuing 1099s in his small business--atlasman--if you are in a business requiring Workmen's Comp, you do know that you must get certificates of insurance from your subcontractors or be liable for any of your uninsured subcontractors when you contract? There are fairly strict requirements for subcontractors v. employees, also. (I know people in trouble for both).
I am studying economics on my own until I start classes, and I welcome information and links to studies and discussion from those who would like to discuss their favorite economic subject, if anyone is so inclined. (Think back to when you first got the fever) Thanks!
The only houses selling are the $250K and under, and the bulk are in the under $100K. ACORN is writing 3% down loans with 8,000 in tax rebates for first time buyers. Imagine you have tax advice from those ACORN video workers, they can you qualified ..... my guess is these loans will default as well.