Tag Archives: CBO

News

Understanding the real effects of the Democrat health care reform bill

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Story from the Wall Street Journal. (H/T ECM)

Excerpt:

The Congressional Budget Office figures the House program will cost $1.055 trillion over a decade, which while far above the $829 billion net cost that

[…]All this is particularly reckless given the unfunded liabilities of Medicare—now north of $37 trillion over 75 years.

[…]As for Medicaid, the House will expand eligibility to everyone below 150% of the poverty level, meaning that some 15 million new people will be added to the rolls as private insurance gets crowded out at a cost of $425 billion. A decade from now more than a quarter of the population will be on a program originally intended for poor women, children and the disabled.

[…]All told, the House favors $572 billion in new taxes, mostly by imposing a 5.4-percentage-point “surcharge” on joint filers earning over $1 million, $500,000 for singles. This tax will raise the top marginal rate to 45% in 2011 from 39.6% when the Bush tax cuts expire—not counting state income taxes and the phase-out of certain deductions and exemptions. The burden will mostly fall on the small businesses that have organized as Subchapter S or limited liability corporations, since the truly wealthy won’t have any difficulty sheltering their incomes.

This surtax could hit ever more earners because, like the alternative minimum tax, it isn’t indexed for inflation. Yet it still won’t be nearly enough. Even if Congress had confiscated 100% of the taxable income of people earning over $500,000 in the boom year of 2006, it would have only raised $1.3 trillion. When Democrats end up soaking the middle class, perhaps via the European-style value-added tax that Mrs. Pelosi has endorsed, they’ll claim the deficits that they created made them do it.

Under another new tax, businesses would have to surrender 8% of their payroll to government if they don’t offer insurance or pay at least 72.5% of their workers’ premiums, which eat into wages. Such “play or pay” taxes always become “pay or pay” and will rise over time, with severe consequences for hiring, job creation and ultimately growth. While the U.S. already has one of the highest corporate income tax rates in the world, Democrats are on the way to creating a high structural unemployment rate, much as Europe has done by expanding its welfare states.

Meanwhile, a tax equal to 2.5% of adjusted gross income will also be imposed on some 18 million people who CBO expects still won’t buy insurance in 2019. Democrats could make this penalty even higher, but that is politically unacceptable, or they could make the subsidies even higher, but that would expose the (already ludicrous) illusion that ObamaCare will reduce the deficit.

Click here to read the rest of the article. It’s quite comprehensive and yet concise.

News

CBO predicts Social Security cash deficits in 2010

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Ed Morrissey has the story at Hot Air.

Excerpt:

Four years ago, George W. Bush attempted to reform the entitlement program Social Security, warning that the system was accelerating into collapse and would soon run deficits.  Democrats scoffed and claimed the Social Security system was solid and wouldn’t have problems for at least 50 years, as Harry Reid told PBS’ Jim Lehrer in June 2005.  Just last year, the CBO — under the direction of Peter Orszag, now budget director in the Obama administration — claimed that the first cash deficits in Social Security would not come until 2019.

Now, however, the CBO has determined that Social Security will run cash deficits next year and in 2011, and by 2016 will be more or less in permanent deficit mode.  Hot Air has exclusively obtained the summer 2009 CBO report sent to legislators on Capitol Hill but not yet made public, which shows that outgo will exceed income for the first time since the 1983 fix on an annual basis in 2010…

And it’s actually worse than that.

Check out their update:

Steve at No Runny Eggs, who has been keeping a very close eye on SSA, says that the CBO numbers project some eye-popping payroll-revenue growth numbers to get back to surpluses (briefly) by 2012.  According to the numbers, CBO projects a 6.19% growth rate in 2012, and 5.69% in 2013, then dropping to 4.59% in 2014 and declining afterwards.  Assuming that they only peak at the 4.59% number for all three years — still a rather optimistic projection — Social Security never actually comes out of its deficits at all…

Click here to see a summary the CBO report.

The numbers are explained in the Hot Air post.

To understand the challenge that entitlement programs pose to a balanced budget, watch this 2-minute video.

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MUST-SEE: Sen. Jim Demint demolishes Obama’s socialist health care plan

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This is more must-see than any other must-see I have ever recommended. (H/T Hot Air, Stop the ACLU)

Excerpt: (H/T Gateway Pundit)

“The last time the President made grand promises and demanded passage of a bill before it could be reviewed, we ended up with the colossal stimulus failure and unemployment near 10 percent,” said Senator DeMint.

“Now the President wants Americans to trust him again, but he can’t back up the utopian promises he’s making about a government takeover of health care. He insists his health care plan won’t add to our nation’s deficit despite the nonpartisan Congressional Budget Office saying exactly the opposite. And today we learn that the President is refusing to release a critical report on the state of our economy, which contains facts essential to this debate. What is he hiding?

“If the actual legislation came close to matching the President’s rhetoric, he would have no problem passing this bill with huge Democrat majorities in both chambers. But Americans aren’t being fooled and are discovering the truth about his plan which includes rationed care, trillions in new costs, high taxes and penalties that will destroy jobs, and even government-funded abortions.

“Let’s be clear, there is no one in this debate advocating that we do nothing despite the President’s constant straw man arguments. Republicans have offered comprehensive health care reform solutions that cover millions of the uninsured without exploding costs, raising taxes, or rationing care. We can give every American access to a health plan they can own, afford and keep without a government takeover.”

THIS IS A PERFECT SPEECH.

Even better than his denunciation of the hate crime bill.

It’s as good as Michele Bachmann’s Gangster-Government speech!

So I guess it’s Michele Bachmann and Jim Demint in 2012, then! Right? Bobby Jindal can be Secretary of Health & Human Services, Sarah Palin can be Secretary of Energy, Paul Ryan can be Secretary of Commerce and John Bolton can be Secretary of State. And Edith Hollan Jones and Janice Rogers Brown go on the Supreme Court! Oh, that makes me so happy!

Health care quality will suffer

Meanwhile, the Mayo Clinic, one of the most prestigious health care providers in the world, is disgusted with Obama’s health care plan. (H/T Hot Air, American Spectator via ECM)

Excerpt:

Although there are some positive provisions in the current House Tri-Committee bill – including insurance for all and payment reform demonstration projects – the proposed legislation misses the opportunity to help create higher-quality, more affordable health care for patients. In fact, it will do the opposite.

In general, the proposals under discussion are not patient focused or results oriented. Lawmakers have failed to use a fundamental lever – a change in Medicare payment policy – to help drive necessary improvements in American health care. Unless legislators create payment systems that pay for good patient results at reasonable costs, the promise of transformation in American health care will wither. The real losers will be the citizens of the United States.

Obama is interested in controlling as much of the economy as possible – he is not interested in providing good services and prosperity for you!

Further study

You can learn more about the Republican health care plan with short 5-minute podcasts by brilliant policy analysts like Regina Hertzlinger, Sally Pipes and Rep. Paul Ryan. Not to mention Michael Tanner and Michael Cannon of the Cato Institute. There is an alternative way to lower health care costs while preserving individual choice and liberty: consumer-driven health care. Health care videos are here.