Gary Johnson On PPACA Decision: Close!
The Market Ticker ® - Commentary on The Capital Markets
Posted 2012-06-30 10:40
by Karl Denninger
in Editorial
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Gary Johnson On PPACA Decision: Close!
 

From my emailbag yesterday afternoon...

“It has been clear for a while that we need a new President and a new Congress. Now it appears we need a new Supreme Court.

“Whether the Court chooses to call the individual mandate a tax or anything else, allowing it to stand is a truly disturbing decision. The idea that government can require an individual to buy something simply because that individual exists and breathes in America is an incredible blow to the bedrock principles of freedom and liberty. It must be repealed, and Congress needs to get about doing so today.

“There is one thing we know about health care. Government cannot create a system that will reduce costs while increasing access. Only competition and the price transparency that competition will bring can accomplish the imperatives of affordability and availability. Whether it is the President’s plan or the Republican prescription drug benefit, the idea that anyone in Washington can somehow manage one of the most essential and substantial parts of both our quality of life and the economy is, and always has been, fundamentally wrong.

“We can never know how many Americans are out of work today because of the uncertainty the monstrous health care law has caused. The Court has done nothing to remove that burden.

“Nothing about today’s decision changes the basic reality that it is impossible to eliminate deficit spending and remove the smothering consequences of federal debt without dramatically reducing the costs of Medicare and Medicaid. And neither the Democrats nor the Republicans have given the slightest hint of willingness to do so.”

Well, the last statement is utterly true.  But it's not just deficit spending -- it's the compound growth of medical spending entirely.

Here Gary gets it somewhat right.  This is what he says on his web site:

Revise the terms of entitlement programs such as Medicare, Medicaid, and Social Security, which threaten to bankrupt the nation's future.

and

MOST PEOPLE IN WASHINGTON SEEM TO THINK that we can control spending and balance the budget without reforming Medicare, Medicaid and Social Security. This is lunacy.

  • Identify and implement common-sense cost savings to place Medicare on a path toward long-term solvency.
  • Block grant Medicare and Medicaid funds to the states, allowing them to innovate, find efficiencies and provide better service at lower cost.
  • Repeal President Obama's healthcare plan, as well as the failed Medicare prescription drug benefit.
  • Fix Social Security by changing the escalator from being based on wage growth to inflation. It's time for Social Security to reflect today's realities without breaking trust with retirees.

Unfortunately the three top points don't get there.

The problem isn't entitlements per-se in the medical field.  It is the medical system in total.

So long as you can force other people to pay for your medical care, unlinking your personal medical decisions (and lifestyle decisions that wind up being medical decisions down the road) there is no solution.  The demand for something that has a price (to the user) of zero is infinite. 

If steak was available at no cost to you it would be your meal of choice pretty much all the time.  Ditto for most other things that enhance your life; if you could have a Porsche at zero cost, of course you would, right?

Without putting a stop to the ability of Juanita the illegal Mexican immigrant to show up in an ER 7-1/2 months pregnant with no prenatal care along with both a drug and alcohol problem, in labor, and allowing her to bill not only her care but the $2 million NICU charge to you, I, and everyone else in the nation we cannot fix what's broken in the medical system or medical entitlements.

Without putting a stop to your ability to eat yourself into a 500lb walking refrigerator, then bill everyone for the heart attack and diabetes you caused through your own personal decisions and conduct, we cannot fix what's broken in the medical system or medical entitlements.

Without putting a stop to the pharmaceutical industry's ability to force you, as an American, to pay 2, 5, 10, 20 or even 100 times as much for a pill or device here in America as you could buy that same thing in Canada or some other nation, we cannot fix what's broken in the medical system or medical entitlements.

Without putting a stop to hospitals billing you $30,000 for a procedure while the guy in the next bed over in your hospital room paid $3,000 for the exact same procedure because he paid for it using a different means than you did we cannot fix what's broken in the medical system or medical entitlements.

Note that the last two are unlawful in virtually every other line of work.  It is illegal to conspire to fix prices or restrain trade on a broad basis.  It is especially unlawful when it is done to someone under duress (and you most-certainly are when you're having a heart attack!)

Gary is right about needing a new Supreme Court.  In particular, what happened with this decision is that the US Supreme Court has ruled that federal power literally has no limit; the government can now compel any behavior by simply associating it (or failure to perform it) with a ruinous tax.  What this decision has done is turn 536 clowns in Washington DC into effective dictators and rendered "recourse before the law" meaningless.  I guess I should not be surprised after the last five years of blatant and outrageous lawlessness in the financial sector, but even I was stunned at the depravity of the Roberts court and its arrogance; it was a literal page out of North Korea's government handbook.

What Gary Johnson is promoting is far better than either Romney or Obama in this regard.  Now if Gary can spend the time and effort to think through exactly where the problem really lies, and put forward policies that will actually halt the destruction of our economy and government by the medical monster, we'll be making real progress.

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User Info Gary Johnson On PPACA Decision: Close! in forum [Market-Ticker]
Alchemista2
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I was worried this would give government limitless power too, but on reading more the SCOTUS did make a distinction between a tax and a penalty. They said the government can't tax a behavior so much that it would be unbearable for someone to choose not to do the behavior. The SCOTUS said the boundaries of what a tax and penalty is will be subject to debate.

So, while it's true that the government does now have power to tax any non-behavior (bad enough on its own), it's not limitless in how much they can tax/penalize. You could probably
Flappingeagle
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If Johnson would take a hard look around and revise some of his policies he would be able to make a really good showing in November. Karl what you are saying is right on the money and we need a candidate who will get out there and explain the WHY of why healthcare costs so much.

There are a lot of people in the USA who are really fed up with the way things are and the way things are going, they just need a candidate who will lay out a plan that they can look at, identify with, and say "yes that makes sense, you are saying that 2+2=4 and that's how I see it as well".

Flap

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Alchemista2
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I also thought this ruling made the government's power to tax limitless, but the SCOTUS did differentiate between a tax and a penalty. The distinction was made that the government cannot tax a behavior (or non-behavior) so much that it makes it unbearable for an individual to choose their behavior.

While it's bad enough that the government can tax anything now, it's not limitless yet on how much they can tax. The SCOTUS even said that there will be debate on the boundary between tax and penalty.
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Jal
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Quote:
... put forward policies that will actually halt the destruction of our economy and government by the medical monster, we'll be making real progress.


I disagree ... the solution would destroy our economy and government.
Paulanderson
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The part of all of this that confuses me is - what's new? Hasn't the federal government been taxing behavior it doesn't like for years? Isn't the mortgage interest deduction a tax on people who don't own homes? Isn't the marriage "tax" sort of the same thing for people of a certain income who want to marry? How is this new "tax" a further power grab? To me, it looks like more of the same.

I'm very surprised that SCOTUS felt like they could take a broken law and re-write it. That part is actually shocking to me. But I'm not a bit surprised that the government felt like it had this power, because it's been exercising it through the tax code for years - only no one was complaining so much (everyone takes the mortgage interest deduction, right?) when they thought it was benefiting them.


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Infidel
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Gary Johnson is about as relevant as Pat "If elected I will win" Paulson

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Tsherry
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There is nothing wrong in DC that a strategically placed meteor wouldn't take care of.
Bagbalm
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Alch' - "The distinction was made that the government cannot tax a behavior (or non-behavior) so much that it makes it unbearable for an individual to choose their behavior."

Well, Alch' the government finds it 'bearable' to throw old people out of their home without any regard for where they will go if they can't keep the property tax up. So don't expect any particular gracious benevolence from them.
Standby
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Depraved is a word that kept coming to mind yesterday with the reaction of Obamacare supporters. Geez, like animals. I feel like I might be part of the buffet.
Noodleman
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Personally I don't think Gary Johnson is very far removed from the other establishment candidates in the race for the POTUS. Gary nibbles at the edges of what Karl says but refuses to take a full bite. Let's face it. The healthcare system in America is not designed to serve the ordinary US citizen. It's designed to serve the oligarchs. And those who lick oligarch boots or who are oligarchs themselves will do whatever is necessary to maintain the status quo. Although Obamacare is heralded as 'change' all it really does is transfer more wealth from the ordinary working guy to the oligarchs. How in the F does 'access' to HC improve society when all it effectively does is punish the producer and reward the parasite by funneling more money to the health care providers and their shyster brokers? Remember how 'managed care' was going to save our healthcare system? heh. Do any of you know a medical tech? Ask him how many unnecessary tests are still performed with no practical purpose other than to pad the bottom line.

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Mannfm11
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I kind of liked Johnson in the Republican debates. That said, he is still a politician. Plus, he probably doesn't belong as the Libertarian candidate. That said, he had some exposure on the big stage and probably gives the L's extra exposure. We need to make a showing this time. Politics are going to change in the US big time during this time frame and hopefully they will change toward freedom and personal responsibility and away from big brother, big military and big medicine.

That said, the true purpose of this post was to link an article from the big Daddy Libertarian, Murray Rothbard.

http://mises.org/daily/6099/Government-M....

Rothbard hammers government and insurance in medicine. He is talking in 1990's terms when he talks about cost and I am sure he would not only roll over in his grave if he knew what it costs today, but he wouldn't even be surprised. Point being we have done nothing about it in the ensuing 16 years or more since he wrote this.

I had read this before, but the AMA runs US medicine and Rockefeller cartelized alopathic medicine in the US 100 years ago. We are being ****ed by a cartel. Insurance made the costs bearable for the insured and a honey pot for the industry. I had recognized this fact years ago. There is no competition in medicine and no standardization. Rothbards article is worth reading, as it frames much of the problem very well. I think it follows what Karl writes in this subject enough that one validates the other.

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Goforbroke
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Quote:
allowing her to bill not only her care but the $2 million NICU charge to you
... with no maximum lifetime limitation.

This simply will not work. A totally unrealistic promise is being made, and I would bet that there is absolutely no intention on following through with that promise. I forsee active death panels at hospitals to decide when enough is enough in any particular case.

The American people have (yet again) been suckered into something which is too good to be true, and which ultimately will not come to fruition.

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Debtpie
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Standby says: "Depraved is a word that kept coming to mind yesterday with the reaction of Obamacare supporters. Geez, like animals. I feel like I might be part of the buffet."

What you witnessed is not depraved animals at a buffet; what is on display is desperation because the current system locks out 10's of millions from basic care to say the least.

These people end up dependent upon the government because there is no other choice. Their income cannot support the insurance payments and their job (if they have one) doesn't provide it.

Example: The CEO of Starbucks earns $30,000,000 a year...his typical Barista earns $15,000 a year. Why so low? By keeping their hours down, the company doesn't have to provide health insurance. Yet it can still run around telling the world that it's employees (that work enough hours) have health insurance.

Result: There is no way these Barista's can afford $500 to $1000 a month for a health insurance plan..so they end up either showing up in the emergency room and then not paying...or they go on the government dole through Medicaid or some other state program.

It's a big subject, but in my opinion we've got to end the employer/employee/insurance relationship in the top 10 list of things to do.

Health insurance should be like all other insurance; purchased on an individual basis.

As flawed as ObamaCare is; it gives these people hope that they will be able to receive care and that is why they are so jubilant that it's still alive.

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A Leader, or an Opportunist? "A leader has the capacity of vision, the ability to see where things are headed before people in general see those things." Mitt Romney --- DebtPie's definition: a leader decides where "things" should head and "leads" us there.

Genesis
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No it won't.

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What part of "shall not be infringed" was unclear?
Debtpie
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Genesis Says "No it won't."

If you're responding to my post...my reply is the current system has definitely locked them out...so at least they "think/feel" they have a chance with ObamaCare.

The Romney/Republican plan? Well, we'll have to elect them to find out what's in it.

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A Leader, or an Opportunist? "A leader has the capacity of vision, the ability to see where things are headed before people in general see those things." Mitt Romney --- DebtPie's definition: a leader decides where "things" should head and "leads" us there.
Wis/min
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Debtpie, How do you propose to fund the promises of Obamacare?
Genesis
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Obamacare leaves you with a simple economic decision - drop health care coverage for yourself and your dependents, pocket the money (and pay the "fine"/tax)

Same for businesses. It is FAR CHEAPER to pay the fine/tax than provide the insurance now.

So what happens? Only sick people buy insurance because you can't be penalized for doing this. That means that insurance will quite-quickly cost 10x what it does now, because it's like buying insurance for your car AFTER you wreck it.

That in turn will mean that nobody will be ABLE TO AFFORD the insurance, which in turn will collapse the system.

What's left?

Well now, that's the interesting question, isn't it?

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What part of "shall not be infringed" was unclear?
Goforbroke
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What's left is rationing. Even though there is no penalty for preexisting conditions, even though there is no lifetime maximum, even though there is "free" preventative care, there will have to be rationing, as put into practice by exceedingly long wait times. That's something no one is talking about; there's nothing in this bill which specifies the timeframe in which care must be administered, and that's where they've got "you."

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Rjazz117
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Debtpie wrote..
...my reply is the current system has definitely locked them out...


No they're not, by your own admission:

Debtpie wrote..
..so they end up either showing up in the emergency room and then not paying...or they go on the government dole through Medicaid or some other state program.


Do you not read what you post?

smiley

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Marcustullius
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RJazz, I think that Debtpie means "the current system has definitely locked them [the $15k/year workers] out ...of any affordable & useful health insurance". But perhaps clarification should come from that corner.

Tully

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Mannfm11
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My response to debt pie is those $15,000 a year people are locked out of the luxury car market, the luxury home market, the high dollar restuarant market and so on. They don't have the deductible. GOVERNMENT CREATED THIS MONSTER. It was created to make the population dependent and to channel a fortune to the medical industry. This is merely to keep the bubble inflating. Ever think that indoor plumbing, flush toilets and refrigerators have done more to extend the lives of people than everything medicine has done, sans basic anti-biotics combined? You might read the link to Rothbards post.

My mother went to Europe with my niece. They visited the family of someone my niece had met over here in Norway. The friends mother had a bad gallbladder. She could not get an operation. Norway is floating on oil and the resulting prosperity, but the fantastic socialistic medical system wouldn't solve this woman's problem until it because a threat to her life. If you have never had gallbladder problems, they are much akin to having one of your nuts in a vise, turning the handle back and forth, tightening and loosening. Ruptured, they will finish your ass. The operation is almost day surgury in the US.

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Rjazz117
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Marcustullius...yes...clarification SHOULD come from Debtpie...I'm still waiting.

Oh, AND: those making that little money are still not "locked out"...they can choose NOT to buy an iPhone with $60/mo. plan, "bling" of any kind, a flashy ride, $100 gym shoes, steak/lobster/filets for dinner every night, $200 in drinks every Friday/Saturday night with their gang at the local watering hole...and instead, purchase...wait for it...HEALTH INSURANCE.

Priorities, folks...that is what this (from the consumer end) has always been about.

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“To compel a man to subsidize with his taxes the propagation of ideas which he disbelieves and abhors is sinful and tyrannical.” Thomas Jefferson
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