Tag Archives: Corporation

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

Medicare fraud is 7.5 times the profit of ten largest medical insurers

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Story from The Weekly Standard. (H/T ECM)

Excerpt:

As 60 Minutes reported last week, Medicare fraud is rampant and has now replaced the cocaine (ahem) business as the major criminal activity in South Florida. Both 60 Minutes and the Washington Post report that Medicare fraud now costs American taxpayers roughly $60 billion a year. That may sound like a lot of money, but surely it pales next to the extraordinary profits of private insurance companies, right?

Well, let’s see…. Last year, the profits of the ten largest insurance companies in America were just over $8 billion — combined. No single insurance company made even five percent of what Medicare reportedly loses in fraud.

While we’re making comparisons, in its real first ten years (2014-23), the Senate Finance Committee bill would cost $1.7 trillion. At the rate of last year’s profits, the combined ten-year profits of America’s ten largest insurance companies would be $83 billion — five percent of the costs of the Senate Finance Committee bill. Eighty-three billion dollars may not buy you much in comparison with BaucusCare, but — on the bright side — that ten-year tally is somewhat more than what Medicare loses each year in fraud.

Another great find by ECM! What would we do without him?

News

Canada seeks to sell government-run firms

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My Canadian friends are telling me that Prime Minister Stephen Harper is under fire for offering 9.5 billion dollars to GM. I tell them, who cares? Canada is 10% the size of the USA, so that would be 95 billion for us. I still believe in Harper, and in any case, he already expressed that his preference would be to let the companies go bankrupt.

But let’s take a look at the latest news from Canada. In Canada, they have corporations that are owned by the government called Crown corporations. Some of them are losing money. So what does Harper want to do about that?

Check out this story from the National Post. (H/T My friend Andrew, the perfect father)

The federal Department of Finance has flagged several prominent Crown corporations as “not self-sustaining,” including the CBC, VIA Rail and the National Arts Centre, and has identified them as entities that could be sold as part of the government’s asset review, newly released documents show.

…Finance Department documents, obtained by Canwest News Service under the Access to Information Act… reveal that the government will consider privatizing Crown corporations that require public subsidies to stay afloat.

“The reviews will also examine other holdings in which the government competes directly with private enterprises, earn income from property or performs a commercial activity,” states a Finance briefing note dated Dec. 2, 2008. “It includes Crown corporations that are not self-sustaining even though they are of a commercial nature.”

In the briefing note, the Finance Department identifies nine Crown corporations that fall in that category, including Atomic Energy of Canada Ltd., the CBC and VIA Rail.

CBC is their NPR/PBS and Via Rail is their AMTRAK. Harper is taking a lot of heat right now because he is running a 50 billion dollar deficit. That’s chump change compared to our nearly 2 trillion dollar deficit this year alone, with no end in sight. Not only that, but Heritage Foundation reports that Obama’s calling up the mayor of Detroit and reassuring him that GM will not move their headquarters to Warren, from Detroit.

More Harper