This is the best post I have ever seen on the problem of demographics and entitlement spending, which is due to explode in about a few years. I’ll summarize so that you will click through and read this post for yourself. There is almost no text in the post, it is all graphs, and they are self explanatory. It will take your about 5 minutes to scare yourself into a coma.
Summary of the post:
There are 3 entitlement programs: social security, medicare and medicaid
These programs are funded by taxes on young people who are still working
These 3 programs currently cost 9% of GDP.
By 2050, the costs will have doubled to 18% GDP.
Some of this increase will be due to excess growth in health costs
And some of this increase will be due to demographics
Let me talk more about the demographics problem:
More people are living longer
That means that benefits are being paid out over more years, per person
A huge group of babies from the Baby Boom started retiring in 2008
But the number of younger workers who pay their benefits is not growing fast enough
The number of workers needed to pay each retiree’s benefits is shrinking
Taxes will have to increase, or benefits will have to decrease
Please read the article. It will help you to put Obama’s massive spending and tax hikes in perspective. By the way, this is a great post to forward to your friends and neighbor’s who voted for Obama who do not like to read about economics and finance.
These video clips feature one of the conservatives I like, Senator Tom Coburn! (H/T Club for Growth)
Tom Coburn is a medical doctor, and ran a medical business. He gives you the inside view of why American health care needs changing, and why big government socialism is not the answer. This is not just a lesson in health care. Listen closely – this is a lesson in economics, and it shows the vision of free-market capitalism, liberty and personal responsibility that drives the policies of the right-wing.
Part 1:
Part 2:
And here is Ronald Reagan talking about the loss of liberty that follows when a country adopts socialized medicine. (H/T Club for Growth)
This is the easiest way to learn about health care policy.
Note: If you prefer to learn about socialized vs consumer-driven health care with podcasts, click here.
More details from a think tank
Here is a comprehensive treatment of the problems of health care today, and the right way to reform it. This article by the founder of the Heritage Foundation, Edwin Feulner, Ph.D., is so long that it is exactly the kind of thing that lefties like commenter Jerry won’t have the patience to read! This is the best thing to read in this post if you can only read one thing.
Here is are some of the myths he corrects:
If you like your health care package you can keep it
“…a public plan will lead many employers to drop private health coverage for their workers and dump them into the public plan… According to independent analyses, as many as 119 million Americans could end up in a public plan….”
The end goal is not a single payer system
“…The “single payer” here is Uncle Sam, using taxpayers’ money, and not just paying the bills but calling the shots and deciding what care every American will get—or not get….”
The end goal is not a single payer system
“…Congress’s own watchdog–have issued preliminary estimates that the cost could be high as $2 trillion over 10 years, with most of that borrowed money…”
The quality of your health care will get better
“…Medicare has huge gaps in coverage. Medicaid’s quality is notoriously bad. They both offer substandard care compared to most private insurance plans…”
And of course his letter also gives conservative solutions to the problem of rising health care costs. The Heritage Foundation is my favorite think tank. Conservative across the board – not just on fiscal issues.
James Demint
And conservatives like James Demint are getting this message out to the public, too.
Sen. James Demint
Here is Senator Demint’s article in Forbes magazine. He answers the question: “What is the cause of our current health care problems? Is it the free market? Or is it government intervention into the free market?”
Excerpt:
…Washington politicians make it hard for individuals to own their own health insurance policies. Government gives tax benefits to businesses to provide group health plans to employees, but offers no such tax benefit to individuals who try to buy their own plan for themselves or their family. Government prevents consumers from shopping for better plans across state lines, which limits competition and drives up prices. Government health care programs like Medicare and Medicaid pay doctors and hospitals less than the full value of their services, and the difference gets priced into the higher premiums paid by people who do have insurance.
In other words, politicians deliberately restrict consumer choice, drive up prices, underpay doctors and hinder both access and portability. Then they turn around, blame the free market for the health care crisis and say the only way to save the system is a government takeover of health insurance in the form of a so-called “public option.”
And he’s goes on to explain conservative solutions to the problem of rising health care costs. A great article from one of my favorite conservatives.
The real costs of Obama’s plan
Keith Hennessey has an analysis of the costs of Obama’s new government-controlled, rationed health care plan. You may have heard that the CBO has issued an estimate about the costs of Obama’s plan: 1 Trilliion over 10 years. Keith says that the number is actually closer to 1.3 trillion.
Health care subsidies over 6 years
Keith took at closer look at the CBO’s 1 Trillion estimate, which includes only ONE area where money will need to be spent (subsidies for the poor). He found that many items in the Democrats’ health care bill were not included in the CBO estimate!
Excerpt:
The budgetary effects of neither the individual mandate nor the employer mandate are included in this score. I think CBO will find these provisions would raise revenues for the government and reduce the deficit. While the leaked draft of Kennedy-Dodd was specific about the employer mandate, the official version has just the placeholder language, “Policy under discussion.” Both mandates leave wide discretion for the Secretaries of Treasury and HHS to create a level and structure of taxation “to accomplish the goal of enhancing participation in qualifying coverage.” It is extremely difficult for CBO and their tax counterparts, the Joint Committee on Taxation (JCT) staff, to estimate something like this.
The estimate does not include the budgetary cost of expanding Medicaid to childless adults with income below 150% of the poverty line. I expect that this will add hundreds of billions of dollars to the cost over the next decade.
It does not include the requirement that health plans define “children” as dependents up to age 27. I expect this will raise costs.
It does not include the effects of the Medical Advisory Council’s ability to define benefits, or the requirements that plans rebate premiums to the insured. I think this too will raise costs.
It does not include the budget effect of having a “public plan option.”
There are a bunch of other programs in the bill, including a new disability program and lots of new public health programs.
Keith will be posting more articles on his blog as he calculates the real costs of Obama’s plan.
Obama thinks that you are more satisfied with the service at your local DMV than you are with Amazon.com. And he plans to make sure that you are dealing with government bureaucrats, not with private businesses, when you need health care. Who gives you better service? The government, that isn’t trying to compete with anyone to meet your needs? Or private businesses, which do need to compete to earn your business?
Further study
You can watch some videos containing horror stories from countries that have adopted single-payer health care, too.
Health-care overhaul legislation being drafted by House Democrats will include $600 billion in tax increases and $400 billion in cuts to Medicare and Medicaid, Ways and Means Committee Chairman Charles Rangel said.
Democrats will work on the bill’s details next week as they struggle through “what kind of heartburn” it will cause to agree on how to pay for revamping the health-care system, Rangel, a New York Democrat, said today. The measure’s cost is reaching well beyond the $634 billion President Barack Obama proposed in his budget request to Congress as a 10-year down payment for the policy changes.
Asked whether the cost of a health-care overhaul would be more than $1 trillion over a decade, Rangel said, “the answer is yes.” Some Senate Republicans, including Senator Orrin Hatch of Utah, say the costs will likely exceed $1.5 trillion.
…That won’t be enough to cover the overhaul costs. Obama said this week he plans in the coming days to disclose more proposals for raising “additional sources of revenue.” In a letter last week to Senate Democrats drafting legislation he said he will be proposing between $200 billion and $300 billion in further Medicare and Medicaid cuts.
If you think that tax hikes on “the rich” won’t affect you, you’re naive. The rich are the people you work for. If Obama starts confiscating your money, they will ship your job overseas where taxes are lower. That’s just the way it is. The most productive people in the world are not just going to hand over their money to Obama to redistribute to unions, bureaucrats, the United Nations, ACORN and Planned Parenthood.
Stem cells in India
Meanwhile, here is a neat health care story so you will know where to go for medical treatment (India) after Obama tells you that you will have to wait two years behind people who voted for him.
“It was the first time in eastern India that such a transplant was being performed on a child,” he said….Pramita’s bone marrow, which contain stem cells, was collected from her spinal cord. It was successfully transplanted in her body in April 2009. The entire process took two months during which she was kept isolated in a sterilised room with high efficient particulate air (HEPA) filter. “We will do a follow-up on her health for the next six months since she may contract infection during this period and so has to follow some restrictions. But after that she can lead a normal life and can resume her dance lessons without any problem,” Dr. Mukhopadhyay said.