Monthly Archives: September 2013

DEMOCRATS WANT A SHORT GOVERNMENT SHUTDOWN

A federal government shutdown for a few days will do little damage to the US economy, but will inconvenience and scare many Americans. Democrants  want the shutdown to enhance their chances of gaining control of the House in the 2014 elections. They are goading Republicans into a fight over the funding of Obamacare to give President Obama the opportunity to claim Republicans have forced a shutdown. Polls show that any shutdown will cause great political harm to Republicans who are being wrongfully attacked by President Obama as extortionists. 

Regardless of whether it was adopted based on false promises, Obamacare is the law of the land. Like it or not, many of its provisions will become operative on October 1, with, or without, US government funding.  It is irrelevant that Obamacare is a new welfare program that is causing great damage to our economy. The poor and low-income people it is designed to help  will line up to enroll for the free or highly subsidized insurance policies, with no pre-existing conditions. President Obama has committed to spend billions of marketing dollars to convince Americans that they will love Obamacare in a few years after we make some corrections and to get young people to purchase policies.

Republicans, led by Senators Cruz and Lee, are publicizing many of the negative aspects of Obamacare. They should continue to make their case before the Senate over the next few days.  However, it is inevitable that the Senate bill will be passed without the provision to de-fund Obamacare. When it returns to the House, Republicans should permit the Democrats to prevail. The best that Republicans can accomplish is to get an agreement for the appointment of a joint Congressional committee to consider the modification or repeal of Obamacare. Any attempt to de-fund or delay the effectiveness of Obamacare merely runs time off  the clock before the potential government shutdown.  Republicans will have an opportunity to expose the terrible consequences of Obamacare, including the harm to the middle-class, in the 2014 Congressional campaigns.

Obamacare, even if further modified, will remain a horrible law and hodge-podge of regulations rammed through Congress, without a Republican vote, during the Great Recession. It changes Medicare, Medicaid and almost every aspect of healthcare. It mandates federally approved insurance to be purchased by or for everyone. The poor and low-income taxpayers get free or highly subsidized coverage. To expand the class of beneficiaries, they threw in benefits for children living at home until age 26 and eliminated the doughnut hole from the Medicare drug plan. Our federal and state governments couldn’t afford to pay for it. They, therefore, adopted all kinds of new taxes and penalties on businesses and individuals to pay for their new welfare program.  Our economy, businesses and the middle-class are suffering from the confusion and increased costs. Obamacare is slowing hiring and capital investment and Is is leading to an increase in undesirable part-time  jobs, while causing the loss of full-time, tax-paying jobs.  It is increasing insurance premiums and causing the loss of coverage for many who had insurance. It is harming doctors, hospitals and other healthcare providers and reducing the availability and quality of healthcare. It taxes the gross sales of medical equipment suppliers and drug companies. Such taxes
(unless passed on as increased healthcare costs that will add to the burden being placed on the middle-class) will confiscate the cash needed to support research and development efforts that have placed the US in the forefront of life saving and enhancing equipment and medications. Some of the manufacturers will become unprofitable or will be unable to raise capital, and go out of business. It puts the IRS in control of major healthcare decisions.  Based on recent experience this assures that healthcare subsidies and availability will become politicized and allocated unfairly.  It is so complex that years after its adoption our governments are not prepared for it to become effective.

Why does President Obama like it? It gives the government greater control of our lives and  takes from businesses and individuals who have and gives to those who have not. It adds to his base of people who benefit from handouts. It is unlikely that President Obama and his liberal cronies realized, when it was adopted, how much damage it would do to the economy and the middle-class. As the problems have surfaced, he has made changes in the law and granted waivers without Congressional approval. He talks of further adjustments in the law to work out the kinks. He may not have yet realized that  Obamacare is so conceptually flawed that it is irreparable and should be repealed so that we can go back to a free market solution. Of course that would require taking away or reducing the new welfare benefit. Why should the poor expect to get the same or better healthcare benefits for free than will be available for middle-class people who work to earn the insurance or who may lose their benefits or have to pay for them? Why should we harm business and eliminate or prevent the creation of middle-class jobs, to create another welfare benefit, while the economy remains in a weakened state?

With all the hull-a ballo over Obamacare and the  potential government shutdown, it has gone virtually un-noticed that the disastrous Sequester cuts are retained in the proposed government funding proposal. President Obama and the liberal financial press have been effective in misleading  voters into thinking that the economy is improving  because unemployment is falling and the federal deficit is shrinking. They disregard the large number of people who have left the work-force, the great increase in the number of part-time jobs (largely as the result of Obamacare),  the reduced government spending as a result of the Sequester and the increased revenues from the 2013 tax increases. As a result, and because he refuses to discuss un-funded long-term entitlement (largely Medicare) liabilities, he is in no position to be insisting on necessary increases in defense and infrastructure construction spending to stimulate the economy, provide homeland security  and create full-time, tax-paying jobs. The Obamacare mess makes it highly unlikely that our economy will grow satisfactorily during the remainder of the Obama term. 

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