Category: Economy

Study: Senate Health Bill Brings No Big Cost Rise in U.S. Premiums

Posted on by TL

The Senate health care bill looks better and better every day, and Republican objections ring more and more hollow.

From the New York Times:

The Congressional Budget Office said Monday that the Senate health bill could significantly reduce costs for many people who buy health insurance on their own, and that it would not substantially change premiums for the vast numbers of Americans who receive coverage from large employers.

The eagerly awaited report, which came as the Senate began debate on the legislation, provided Democrats with ammunition against Republicans who have criticized the bill on the ground that it would raise costs for a majority of Americans.

Centrist Democrats like Senator Evan Bayh of Indiana, whose votes are vital to President Obama’s hopes of getting the bill approved, had feared that the measure would drive up costs for people with employer-sponsored coverage. After reading the budget office report, Mr. Bayh said he was reassured on that point.

Before taking account of federal subsidies to help people buy insurance on their own, the budget office said the bill would tend to drive up premiums. But as a result of the subsidies, it said, most people in the individual insurance market would see their costs decline, compared with the costs expected under current law. The subsidies, a main feature of the bill, would cost the government nearly $450 billion in the next 10 years and would cover nearly two-thirds of premiums for people who receive them.

We are on the verge of historic health care reform in the United States.

Keep the fire burning.

More here.

Senate Begins Historic Health Care Reform Debate

Posted on by TL

If I didn’t know any better, I’d say the Associated Press has an opinion on the health care reform debate that began today in Congress.

From the AP, via Yahoo! News:

Riven by partisanship, the Senate plunged into a widely anticipated debate Monday over sweeping health care legislation that President Barack Obama and congressional Democrats have vowed to approve and Republicans have sworn to block.

Debate is expected to last for weeks over the legislation, which includes a first-time requirement for most Americans to carry insurance and a mandate for insurers to cover any paying customer regardless ofmedical history or condition.

"We must avoid the temptation to drown in distractions and distortions," Senate Majority Leader Harry Reid said in the first moments of the first speech, a jab at Republicans that was reciprocated minutes later.

"Well, I don’t know what’s more preposterous: saying that this plan ‘saves Medicare’ or thinking that people will actually believe you," Sen. Mitch McConnell of Kentucky, said of Reid’s oft-made statement.

At a cost of nearly $1 trillion, the legislation is designed to extend health care to millions of American who lack it, abolish insurance industry practices such as denying coverage based on pre-existing conditions and cut back on the rise of health care spending overall.

Despite its huge price tag, the Congressional Budget Office has estimated the 2,074-page bill would reduce federal deficits by $130 billion over the next decade. In all, CBO said 31 million uninsured individuals would receive insurance if the bill were enacted, many of them assisted by federal subsidies. As much as 94 percent of the eligible population would wind up covered. The legislation would be paid for through a combination of cuts in projected Medicare payments to hospitals and other providers, a payroll tax on the wealthy and taxes on drug makers, medical device manufacturers, owners of high-cost insurance and others.

Mitch McConnell is being completely disingenuine. The Republicans have been working to dismantle Medicare for years. The best news is from the Congressional Budget Office. The plan is fiscally sound.

And I don’t want to hear any more Republicans screaming about having to read a 2,074-page bill. Grow up. You wanted to go to Washington. Now read.

Is Your Family on Food Stamps Yet?

Posted on by TL
Food Stamps

The New York Times reports that one in eight Americans—that’s 12.5%—are currently on food stamps. That’s a lot of people. But consider this: one in four children in the United States are on food stamps.

Thats 25% of all the children in the Land of Plenty.

From the New York Times:

[Food stamp use] has grown so rapidly in places so diverse that it is becoming nearly as ordinary as the groceries it buys. More than 36 million people use inconspicuous plastic cards for staples like milk, bread and cheese, swiping them at counters in blighted cities and in suburbs pocked with foreclosure signs.

Virtually all have incomes near or below the federal poverty line, but their eclectic ranks testify to the range of people struggling with basic needs. They include single mothers and married couples, the newly jobless and the chronically poor, longtime recipients of welfare checks and workers whose reduced hours or slender wages leave pantries bare.

While the numbers have soared during the recession, the path was cleared in better times when the Bush administration led a campaign to erase the program’s stigma, calling food stamps “nutritional aid” instead of welfare, and made it easier to apply. That bipartisan effort capped an extraordinary reversal from the 1990s, when some conservatives tried to abolish the program, Congress enacted large cuts and bureaucratic hurdles chased many needy people away.

From the ailing resorts of the Florida Keys to Alaskan villages along the Bering Sea, the program is now expanding at a pace of about 20,000 people a day.

Twenty thousand more people a day eating because of food stamps. According to an analysis by the New York Times, there are 239 counties in the United States where at least a quarter of the population receives food stamps.

We’re not out of the woods yet.

The Bush Legacy continues.

Liberia Sued in London Court for US $20M Debt

Posted on by TL

From the Liberian Daily Observer:

Two Caribbean-registered funds have launched a legal case in London, the UK, against Liberia over a debt that dates back to 1978.

Hamsah Investment and Wall Capital Limited sued Liberia at a British High Court Wednesday for a summary judgment to enforce a 2002 New York judgment for over US$20 million against Liberia.

The US$20 million represents about 5% of Liberia’s total fiscal budget for the year. The Liberian Government, led by President Ellen Johnson Sirleaf, is grappling with the challenges of post-war reconstruction and development amidst difficulties inherited from the civil war, and the effects of the recent global financial and economic crisis.

The New York Court rendered a default judgment against Liberia in 2002, at a time when the West African nation was embroiled in civil crisis.

The Liberian Government has swiftly reacted to the lawsuit by requesting a full trial and describing the plaintiffs as “vultures” that are after money from poor countries such as Liberia.

The troubling legal battle could pose serious setback to the country’s debt relief program under the Highly Indebted Poor Countries Initiative (HIPC), which was agreed upon during the Paris Club arrangement. Liberia’s total debt overhang last year was in the tune of US$5 billion.

Key line: "The US$20 million represents about 5% of Liberia’s total fiscal budget for the year."

Dubai Should Have Figured Out How They Were Going To Pay For All That Stuff

Posted on by TL

We heard from early this morning that the markets were tanking today because Dubai.

I guess they’re not the only ones who borrowed too much to make neat toys, like the only indoor ski resort in the Middle East.

From the Washington Post:

Since the full-scale of Dubai’s huge debt mountain hit home late last year, many investors who have sunk billions of dollars into the emirate’s extravagant projects have been seeking reassurance from Abu Dhabi, capital of the United Arab Emirates.

For years, as Dubai built one grandiose scheme after another, there was the assumption — unwritten but widely believed — that Abu Dhabi would be on hand to pick up the pieces if the emirate’s bubble burst.

But with Dubai raising the possibility that one of its flagship investment vehicles may default, attention is now focusing on just how far Abu Dhabi is willing to go to bail out its smaller brother. Underlying the uncertainty is the widely held thought that Abu Dhabi officials were caught unaware by Dubai World’s dramatic statement, which came just hours after two Abu Dhabi-controlled banks had agreed to subscribe to a $5 billion Dubai bond issue.

Want to help them pay their debt and jump-start the world’s economy? Ski Dubai:

Ski Dubai is the first indoor ski resort in the Middle East and offers an amazing snow setting to enjoy skiing, snowboarding and tobogganing or just playing in the snow. The construction covers an amazing 22,500 square meters covered with real snow all year round. Ski Dubai is related to the Mall of the Emirates and is part of Majid Al Futtaim Group of Companies.

Ski Dubai has 5 runs that vary in difficulty, height and steepness. The longest run being 400 meters with a fall of over 60 meters, making it the world’s first indoor black run. Skiers and snowboarders of all skill levels will enjoy these various slopes and snowboarders can also practice their stunts on the 90-metre long quarter pipe. Kids and parents alike will have fun in the interactive Snow Park which is the largest indoor snow park in the world with 3000 square meters.

You don’t have to worry about ski clothing or equipment either. Ski Dubai has thought of it all and offers guests the use of winter clothing, ski and snowboard equipment. Your skis will carry you down the slope, and the quad-chairlift and tow lift will promptly carry you back to the top for another run.

The DOW Jones was down 154.48 today, closing at 10309.92. The S&P 500 was down 23.36, closing at 1087.27.

Just fly right over there and help us all out, will you? Dubai only owes $60 billion at this point.

Liberian President Ellen Johnson Sirleaf Takes Executive Mansion ‘On the Road’

Posted on by TL

I’ve decided to pay more attention to President Ellen Johnson Sirleaf of Liberia. I am just finishing This Child Will Be Great: Memoir of a Remarkable Life by Africa’s First Woman President. Johnson Sirleaf’s story is amazing, and her memoir offers an incredible history of Liberia.

It is not my intention now to write a review of the book. Yes, I recommend it. Johnson Sirleaf is brilliant, with a strong background in economics and finance. She appears to be keenly aware of the needs, potential and promise of Liberia, and the African continent as a whole. At this point, I want to keep up with President Johnson Sirleaf’s current work, so I’m introducing a new category on Turning Left: Liberia. Expect to read more in the days and weeks ahead.

Let me begin here: Johnson Sirleaf writes stirring and frightening accounts of the bloodbaths of former Liberian presidents Samuel K. Doe and Charles G. Taylor. Charles Taylor is currently on trial in the Hague. President Doe was captured in Monrovia, the Liberian capital, by faction leader Prince Y. Johnson on September 9, 1990. He was tortured and killed. According to Johnson Sirleaf’s memoir, Doe’s ears were sawed off before he died. No one deserves to die that way, Johnson Sirleaf comments, no matter what they’ve done.

So I’m going to start following Ellen Johnson Sirleaf. I believe she is worth of attention. For all I know, she could secretly be a scoundrel — but I don’t think so. My gut tells me she’s for real.

The latest I was able to find is a piece dated today regarding President Johnson Sirleaf taking her Executive Mansion "on the road," visiting the people where they live.

From AllAfrica.com:

Liberian President Ellen Johnson Sirleaf has virtually taken the Executive Mansion "on the road," as the implementation of development projects becomes more compelling, with the arrival of the dry season.

The President was, a little over a week ago, in Falie, Grand Cape Mount County, discussing with her direct representatives-the Superintendents-in the political sub-divisions of the country, their programs and challenges. A number of issues emerged at the forum which not surprisingly, included the administration of the County Development Funds (CDF).

The exercise has, understandably, come under serious criticism, owing to what critics see as a lack of transparency in its administration. The President acknowledged that some of the accusations may not be true. "Some may be rumors; some may be misunderstanding, but in several cases, funds have been misused or misallocated. Your responsibility is to take charge of the CDF in such a way that the mandates given by our Constitution to the three branches of Government are fully respected.

"We are not going to do anything in a confrontational way; we are going to do it through consultations, through dialogue, through working with colleagues with one common objective in mind, an objective that is common to all the branches and to all the leaders and to all the citizens of the County, and that objective is: to bring development to the people. I am sure that in that spirit, we will be able to find a solution, to come up with new procedures that will enable us to get more results and have more effectiveness and efficiency in the implementation of our County Development Projects," the Liberian leader reminded her officials, urging them to start a process of consultation to achieve the objective.

Too many times, she observed, leaders are removed from the people they serve. "Many times the People do not know; this is why sometimes the lack of information gives way to rumors and to wrong information. You are responsible to hold consultations with your citizens. You need to go into the districts, the communities, in the villages. Tell them what you are doing. Show them that the CDA comes out of a process in which they contributed. It’s their project. This is what has been done; these are the problems; this is our progress-so they can know. Because they are the ones that will defend you," she urged the County Superintendents.

I am completely impressed. This sounds just like the woman I read about in This Child Will Be Great. And I look forward to reading more.

Obama Digs In Heels on Afghanistan

Posted on by TL

From the New York Times:

President Obama said Tuesday that he was determined to “finish the job” in Afghanistan, and his aides signaled to allies that he would send as many as 25,000 to 30,000 additional troops there even as they cautioned that the final number remained in flux.

The White House said Mr. Obama had completed his consultations with his war council on Monday night and would formally announce his decision in a national address in the next week, probably on Tuesday.

At a news conference in the East Room with Prime Minister Manmohan Singh of India, Mr. Obama suggested that his approach would break from the policies he had inherited from the Bush administration and said that the goals would be to keep Al Qaeda from using the region to launch more attacks against the United States and to bring more stability to Afghanistan.

“After eight years — some of those years in which we did not have, I think, either the resources or the strategy to get the job done — it is my intention to finish the job,” he said.

He said that he would outline his Afghanistan strategy after Thanksgiving, adding, “I feel very confident that when the American people hear a clear rationale for what we’re doing there and how we intend to achieve our goals, that they will be supportive.”

Mr. Obama was silent on what "finish the job" entailed, nor did he offer any details on what benchmarks he and his advisers had drawn up. He also did not provide a target date for finishing the war.

According to the Washington Post, Speaker of the House Nancy Pelosi said Democrats face "serious unrest" over possible expansion of the war in Afghanistan:

Pelosi, in a conference call with economists, said House Democrats were concerned about the "opportunity costs" of steering billions of dollars toward the troop increase as compared to "our ability to invest domestically with an eye to fiscal soundness." The issue of financing new troops in the region has come to a head in advance of Obama’s decision, to be announced next week, as a handful of senior Democrats have proposed a "war tax" on the nation’s wealthiest wage earners and some corporations to finance the war.

Pelosi deflected questions about her support for such a tax-hike proposal but noted that an expensive new war plan faces very high hurdles in her 258-member Democratic caucus, about two-thirds of whom were largely opposed to the Bush administration’s 2007 "surge" of troops into Iraq and have voiced doubts about increased troop levels in Afghanistan.

"Let me say that there is serious unrest in our caucus about, can we afford this war?" Pelosi said in a Tuesday morning call, just hours before she met Obama in a closed-door meeting at the White House.

With an economy struggling to recover, the bottom line is crucial here. Are Americans ready to sacrifice more than they already have? Would Americans support a "war tax," even if it was only on the "wealthiest wage earners," while Congress works to stitch together a health care reform bill?

Help Senator Durbin Fight for the Public Option

Posted on by TL

From the Sun-Times:

Invoking the memory of Edward M. Kennedy, Democrats united Saturday night to push historic health care legislation past a key Senate hurdle over the opposition of Republicans eager to inflict a punishing defeat on President Barack Obama. There was not a vote to spare.

The 60-39 vote cleared the way for a bruising, full-scale debate beginning after Thanksgiving on the legislation, which is designed to extend coverage to roughly 31 million who lack it, crack down on insurance company practices that deny or dilute benefits and curtail the growth of spending on medical care nationally.

Here’s how you can help fight for the Public Option…

From Senator Dick Durbin:

Moments ago, the Senate voted to begin its full debate on historic health care reform legislation instead of obstructing it with a filibuster. 

Tonight’s vote marks the biggest victory to date for our grassroots effort to pass health care reform with a public option. We cannot give enough thanks to the over 100,000 signers of our petition at CitizensForAPublicOption.com for helping to fundamentally shift the momentum towards meaningful reform. 

Not long ago, a few loud opponents of reform armed and organized by the insurance industry dominated this debate. Now the American people, the majority of whom support a public option, have spoken out and gained the upper hand. 

Not long ago, the public option seemed like little more than a pipe dream. Now it’s part of health care bills in both the Senate and the House. 

Not long ago, members of our own Democratic caucus weren’t sure they could even support an up-or-down vote on health care reform legislation. Tonight they voted to end the Republican filibuster. 

But despite this good news, the fight for meaningful health care reform is not over. As we debate amendments to this legislation in the coming weeks, we will work with our colleagues to ensure it continues to address the "Three C’s" of meaningful reform: competition, choice, and cost reduction. And we will firmly oppose any effort to eliminate the public option. 

Tonight we celebrate a milestone no one thought we could reach just months ago. Tomorrow the fight continues. We will not let up until the President signs a bill we can all be proud of.

Thank you for your support.

Sincerely,

Senator Patrick Leahy
Senator Dick Durbin

Senator Chuck Schumer
Senator Patrick Leahy

Senator Dick Durbin

Senator Chuck Schumer

Click Here to Contribute

Bush Tax Cuts Cost Two and a Half Times as Much as House Democrats’ Health Care Proposal

Posted on by TL

Turns out, Bush’s tax cuts hurt the economy. Wha…?

From the Citizens for Tax Justice:

And yet, many of the lawmakers who argue that the health care reform legislation is “too costly” are the same lawmakers who supported the Bush tax cuts. Their own voting record demonstrates that health care reform is not a matter of costs, but a matter of priorities.

It’s difficult to see how the Bush tax cuts could provide us with two and a half times the benefits of health care reform. In 2010, when all the Bush tax cuts are finally phased in, a staggering 52.5 percent of the benefits will go to the richest 5 percent of taxpayers. President Bush and his supporters argued that these high-income tax cuts would benefit everybody because they would unleash investment that would spark widespread economic prosperity. There seems to be no evidence of this, particularly given the collapse of the economy at the end of the Bush years.

Details on the Bush Tax Cuts

The tax legislation enacted under President George W. Bush from 2001 through 2006 will cost $2.48 trillion over the 2001-2010 period. This includes the revenue loss of $2.11 trillion that results directly from the Bush tax cuts as well as the $379 billion in additional interest payments on the national debt that we must make since the tax cuts were deficit-financed.

This figure also includes the cost of adjusting the Alternative Minimum Tax (AMT) to prevent millions of additional taxpayers from being affected by it, as would otherwise have happened as a result of the Bush tax cuts.

Reason for Revisions

The projected cost of the Bush tax cuts is slightly less than we projected previously.5 This is mainly because of the economic downturn, which has reduced incomes. The projected distribution of the tax cuts has also changed slightly. Also, we no longer project the effects of the Bush tax cuts without AMT adjustments, since it is clear that Congress will continue to adjust the AMT to limit the number of people it affects.

Stark Contrast Between Congress’s Approach to Health Care Reform and Approach to Bush Tax Cuts

Over the upcoming decade (2010-2019), the costs of the health care proposals approved by three committees in the U.S. House of Representatives are projected to be around $1 trillion. (One committee trimmed the costs of its health care bill below that amount, but an official estimate of the cost reductions was not available at the time of this writing.)

The chairmen of the three House committees have explicitly stated that their goal is a final bill that is deficit-neutral in the decade following enactment. It’s unclear if they have accomplished this yet, since the Congressional Budget Office has not yet issued final cost estimates of the bills, and the legislation is likely to change before the full House votes on a final bill. But President Obama and Democratic leaders have also committed to ensuring that health care reform will not increase the budget deficit.

Under the House bills, roughly half of the costs would be offset with savings in our existing health care programs, while the other half would be offset with a surcharge on the incomes of wealthy taxpayers. A previous analysis by CTJ has shown that this surcharge is a reasonable approach to financing health care reform and would only affect 1.3 percent of taxpayers. Another CTJ analysis concludes that the surcharge will likely have no significant impact on small businesses, despite some of the misinformation that has surrounded this topic.

In contrast, President Bush and his allies in Congress never even attempted to replace the revenue lost as a result of their enormous tax cuts. The Bush tax cuts were deficit-financed, which increased the national debt and resulted in greater interest payments on that debt, as already explained.

Health Care Reform: A Matter of Priorities, Not Costs

These figures make clear that costs cannot be the real concern of lawmakers who oppose the House health care legislation and yet supported the Bush tax cuts. Their position seems to be that showering benefits on the wealthiest five percent of taxpayers and leaving the bill for future generations is preferable to making health care available for all at a much lower cost and paying that cost up front. That demonstrates a different set of priorities than most Americans have, but it doesn’t demonstrate much concern about costs.

Tip of the hat to Crooks and Liars for this post.

Krugman: Emulate Europe to Spur Job Growth

Posted on by TL

Nobel Prize-winning economis Paul Krugman advises, if the United States will not employ a "conventional stimulus," then the United States should consider European solutions to the Great Recession.

From the New York Times:

Here in America, the philosophy behind jobs policy can be summarized as “if you grow it, they will come.” That is, we don’t really have a jobs policy: we have a G.D.P. policy. The theory is that by stimulating overall spending we can make G.D.P. grow faster, and this will induce companies to stop firing and resume hiring.

The alternative would be policies that address the job issue more directly. We could, for example, have New-Deal-style employment programs. Perhaps such a thing is politically impossible now — Glenn Beck would describe anything like the Works Progress Administration as a plan to recruit pro-Obama brownshirts — but we should note, for the record, that at their peak, the W.P.A. and the Civilian Conservation Corps employed millions of Americans, at relatively low cost to the budget.

Alternatively, or in addition, we could have policies that support private-sector employment. Such policies could range from labor rules that discourage firing to financial incentives for companies that either add workers or reduce hours to avoid layoffs.

And that’s what the Germans have done. Germany came into the Great Recession with strong employment protection legislation. This has been supplemented with a “short-time work scheme,” which provides subsidies to employers who reduce workers’ hours rather than laying them off. These measures didn’t prevent a nasty recession, but Germany got through the recession with remarkably few job losses.

Should America be trying anything along these lines? In a recent interview, Lawrence Summers, the Obama administration’s highest-ranking economist, was dismissive: “It may be desirable to have a given amount of work shared among more people. But that’s not as desirable as expanding the total amount of work.” True. But we are not, in fact, expanding the total amount of work — and Congress doesn’t seem willing to spend enough on stimulus to change that unfortunate fact. So shouldn’t we be considering other measures, if only as a stopgap?

But these aren’t normal times. Right now, workers who lose their jobs aren’t moving to the jobs of the future; they’re entering the ranks of the unemployed and staying there. Long-term unemployment is already at its highest levels since the 1930s, and it’s still on the rise.

And long-term unemployment inflicts long-term damage. Workers who have been out of a job for too long often find it hard to get back into the labor market even when conditions improve. And there are hidden costs, too — not least for children, who suffer physically and emotionally when their parents spend months or years unemployed.

So it’s time to try something different.

We need to do more than what we’re doing. President Obama and Congress must listen. The future of this country — and their respective re-elections — depend on it.

Read the entire column here.