It never, ever ends, does it?

Our company, J.P. Morgan Chase, employs more than 220,000 people, serves well over 100 million customers, lends hundreds of millions of dollars each day and has operations in nearly 100 countries. And if some unforeseen circumstance should put this firm at risk of collapse, I believe we should be allowed to fail. As Treasury Secretary Timothy Geithner recently put it, "No financial system can operate efficiently if financial institutions and investors assume that government will protect them from the consequences of failure." The term "too big to fail" must be excised from our vocabulary.

But ending the era of "too big to fail" does not mean that we must somehow cap the size of financial-services firms. Scale can create value for shareholders; for consumers, who are beneficiaries of better products, delivered more quickly and at less cost; for the businesses that are our customers; and for the economy as a whole. Artificially limiting the size of an institution, regardless of the business implications, does not make sense. The goal should be a regulatory system that allows financial institutions to meet the needs of individual and institutional customers while ensuring that even the biggest bank can be allowed to fail in a way that does not put taxpayers or the broader economy at risk.

The solution is very simple, but you will notice that Jamie doesn't bring it up.  That's because he finds it unacceptable.

What's that solution?

Prohibit as a matter of Federal Law, and enforce it vigorously under pain of immediate dissolution, THE LENDING OF MONEY UNSECURED THAT EXCEEDS THE FIRM'S CAPITAL.

This is in fact the only way you can both end "too big to fail" and not constrain size or influence.

It is also the definition of sound lending.

It is also how lending was done prior to the banksters corrupting the government and literally usurping the sovereign credit of The United States.

As we have seen clearly over the last several years, financial institutions, including those not considered "too big," can pose serious risks for our markets because of their interconnectivity. A cap on the size of an institution will not prevent that risk. Properly structured resolution authority, however, can help halt the spread of one company's failure to another and to the broader economy.

A requirement that you hold one dollar of actual capital for each dollar of unsecured obligation you have, marked to market nightly, absolutely prevents this risk.

That actual excess capital can be lost but there can be no systemic bleed-through as your capital then backs your bets in each and every instance.

While the strategy of artificial limits may sound simple, it would undermine the goals of economic stability, job creation and consumer service that lawmakers are trying to promote. Let's be clear: Banks should not be big for the sake of being big. Moreover, regardless of a company's size, it must be well managed. As we've seen in many industries, companies that grow for the sake of growth or that expand into areas outside their core business strategy often stumble. On the other hand, companies that build scale for the benefit of their customers and shareholders more often succeed over time.

Then prove it by putting your own capital at risk in each and every unsecured lending transaction.  For each loan you write where the collateral is worth less than the outstanding amount of the loan, at any point in time, hold one dollar of your own capital as security against that loan's default and the bleed-through effects on the economy.

And it's not just multinational corporations that rely on such a large scale. J.P. Morgan Chase and others supply capital to states and municipalities as well as to firms of all sizes. Smaller banks play a vital role in our nation's economy, too -- but a fragmented banking system cannot always provide the level of service, breadth of products and speed of execution that clients often need. Capping the size of American banks won't eliminate the needs of big businesses; it will force them to turn to foreign banks that won't face the same restrictions.

Yes, and JP Morgan/Chase will allegedly bribe states and municipalities (aka Jefferson County Alabama) to "obtain" that business and earn a 400% profit beyond the market rate too.  Yes, I know, you didn't admit guilt in the "settlement", but you did pay $75 million and forfeit another half-billion+ in termination fees.  Is it "usual and customary" for your company to pay nearly three quarters of a billion dollars in forfeits and fines when you did nothing wrong?  Our states and municipalities would be far better off without your firm's "services."

Global economic growth requires the services of big financial firms. It also requires that big financial firms be allowed to fail.

ONE DOLLAR OF CAPITAL FOR EACH DOLLAR OF UNSECURED LENDING, MARKED TO MARKET NIGHTLY.

A one-sentence Bill that, were it to become law, would instantly end "too big to fail" and yet let you grow as large as you'd like - provided you are gambling with your own money and not the sovereign credit of The United States.

Amazing story here.... you really need to read the whole thing.  The salient point is here:

The county paid JPMorgan and a group of banks $120.2 million in fees for $5.8 billion of derivatives, according to a series of stories published by Bloomberg News in 2005. The payments were about $100 million more than they should have been based on prevailing rates, according to estimates in 2007 by James White, an adviser the county hired after the SEC said it was investigating the deals.

That's six times what they should have cost - that is, six hundred percent of market price or a 500% overcharge.

Must be nice eh?  What did they do to get this?  Allegedly:

The SEC alleged that JPMorgan, Charles LeCroy, the banker who pitched the refinancing to Jefferson County, and Douglas MacFaddin, the former head of the New York-based banks municipal derivatives desk, made more than $8 million in undisclosed payments to close friends of county commissioners. The associates owned or worked at local-broker dealer firms that didnt do any work on the deals, the SEC said.

Not bad.  Pay $8 million in kickbacks and get $100 million in overcharge.  The allegedly-bribed weren't very good negotiators - you'd think they would have gotten half, right?

And again, we settle for a fine and of course admit no guilt.

Nov. 4 (Bloomberg) -- JPMorgan Chase & Co. agreed to pay $75 million and forfeit another $647 million in interest-rate swap termination fees to settle a U.S. Securities and Exchange Commission probe into the sale of derivatives that helped push Alabamas most populous county to the brink of bankruptcy.

If I pulled something like this as a person I'd go to prison for a number of years - maybe 10 or more.

Why don't government officials revoke the corporate charters of firms that pull this sort of crap?

It's pretty hard to argue that executives at the top level of a company "didn't know" when you overcharge someone by 500%.  It's one thing if you charge someone $100 for a $90 product - it's quite another when you charge someone $120 million for something that is trading in the market for $20 million.

"I didn't know about it" looks awfully thin from where I sit.

Yeah, ok, the title is dramatic and will never happen.

Nonetheless, if we were truly a nation of laws, it would happen.

The LA Times notes regarding IndyMac depositors over the insurance limit:

The head of the Federal Deposit Insurance Corp. delivered some bad news personally to uninsured depositors who lost money last year when IndyMac Bank crashed and burned, saying an act of Congress is their only hope for recovering their funds.

When a bank fails, we have to do whats least-cost to our deposit insurance fund, FDIC Chairman Sheila Bair said during a public appearance Wednesday in Los Angeles.

Sheila is correct as far as she goes, but like most government employees, it is what she didn't say that is the problem, not what she did.

The problem lies with the willful and intentional refusal to enforce black-letter law, in this case Title 12, Chapter 16, Section 1831o which says in part:

Each appropriate Federal banking agency and the Corporation (acting in the Corporations capacity as the insurer of depository institutions under this chapter) shall carry out the purpose of this section by taking prompt corrective action to resolve the problems of insured depository institutions.

"Shall" is a specific term of art in legislation.  It allows no discretion and mandates action.  "May" and "Can" are two other words of course, and mean what they say - as does "shall."

This section of the law goes on to define capitalization "buckets", each of which represents a level above water, or above zero, of the excess of assets .vs. liabilities for depository institutions.

It also contains plenty of other "shall" directives such as:

and plenty more.

Everyone should go read that section of law, and note all the shall requirements in there. 

These are not suggestions, they are mandates, and if they were followed each and every bank that has been closed by the FDIC would have resulted in ZERO loss to uninsured depositors.

The reason for this is simple, when you get down to it - a bank's "capital structure" looks like this (roughly) in terms of claims against a failed institution:

1. Advances and loans/liens by the government (e.g. employment taxes and liabilities)
2. Deposit liabilities
3. Senior secured debt (bondholders)
4. Senior unsecured debt (bondholders)
5. Ordinary debt (bondholders)
6. Preferred stockholders (hybrid stock/bondholders)
7. Common stockholders
8. Excess capital (retained earnings, etc.)

As you can see in a liquidation depositors are subordinate only to statutory preference for employment and similar related claims; the entire capital structure of the firm has to be wiped out before depositors take any loss whatsoever.

If assets are properly valued at all times by government examiners and the bank is closed in accordance with the black-letter requirements of Prompt Corrective Action, then in a liquidation the depositors will never lose any money and neither will the FDIC's Deposit Insurance Fund.

It is in fact willful and intentional blindness by government agencies, including but not limited to allowing financial institutions to lie about the value of their assets, that has resulted in these losses being sustained by ordinary Americans.

Sheila Bair and the rest of the government's "apparatus", including the OTS and OCC, will undoubtedly claim "sovereign immunity" from suit, even though in the instant case, that of IndyMac, the OTS' own inspector general has disclosed that an OTS employee and persons at IndyMac conspired together to back-date deposits, thereby distorting the bank's financial condition, and there is now a 100-bank set of history on FDIC seizures that shows the FDIC has not been and still is not following the black letter requirements of Prompt Corrective Action.

We the people must not accept this sort of malfeasance and misfeasance.  These losses sustained by ordinary Americans are not the result of bad luck or even bad decisions by the banks that have failed.  

Instead, these losses taken by ordinary Americans occurred as a direct result of malfeasance and misfeasance by the OTS, OCC and FDIC itself.

To be blunt, if you lost money as a consequence of being an uninsured depositor at IndyMac that loss occurred as a direct consequence of the willful blindness (or worse) of government agencies who have intentionally and wantonly refused to obey the mandates set before them under black-letter law.

You were, in essence, robbed by the government.

I'm beginning to wonder.

Those of you who have followed my writings for the last two+ years know that I have often remarked "where are the cops?" and in fact more than once asked:

Is the government a policeman or a felon?

The latter is a dangerous question should the answer ever be determined to be the latter, as it would be an open declaration that there is no rule of law.  It would instantly define the entire federal law enforcement apparatus, and those of the States and Localities that stood with the Federal Government, as nothing more than thugs with lots of guns.

That's not a good situation for what should be obvious reasons.

Out-of-control banana republic regimes usually wind up that way incrementally.  Rarely does a madman come to power and simply seize the crown.  Oh sure, it happens, but it nearly always incites immediate civil disorder and even open warfare, civil or (often) externally-promoted.  When Saddam invaded Kuwait it did not take long before the world responded with lots of guns, bombs and planes, as just one example.

But the slow, gradual co-opting of a government from inside out is another matter.  These sorts of regimes usually collapse of their own weight, but not before they take down huge swaths of the population with them, reducing them to squalor.  Thus it happened in Zimbabwe, Argentina and countless others over the years.

Has it happened in the United States already, but the people simply haven't woken up?  Two years ago, five, ten I would have instantly dismissed such a proposition as preposterous.

Now I'm not so sure.

Consider that we have had a group of people on Wall Street who were selling various security products that it is alleged they knew were worthless:

OK still have this vomit? a UBS employee wrote in September 2007 to a director, referring to a CDO with an investment-grade rating, according to the ruling.

Pursuit has established probable cause to sustain the validity of a claim that the UBS defendants were in possession of material nonpublic information regarding imminent ratings downgrades on the notes it sold to the plaintiffs, information UBS withheld from the plaintiffs, Superior Court Judge John Blawie wrote in a Sept. 8 opinion in Stamford, Connecticut.

VOMIT?

This is a firm that still has a license for banking in the United States. It is the same firm that stood accused (and settled) with the IRS over alleged tax shelter abuses in which tens of thousands of Americans were knowingly helped and given safe haven in unlawfully evading US Income taxes.

Yet they hold a banking license and the privilege of clearing funds through US-Treasury sponsored and approved payment mechanisms, including FedWire and trade with (and are "regulated" by) The Federal Reserve in their US operations.

We have Goldman Sachs which has been accused in the media on multiple occasions of selling various subprime mortgage securities to clients while shorting them through other divisions of the firm; if this is a not a declaration of knowledge (or belief) that they're worth less than they were being sold for (if not "worthless" outright) I don't know what is.

Finally, in this same line of thought, we have Washington Mutual, which was what started The Ticker back in 2007: It disclosed in its 1st quarter earnings release of that year it was paying dividends not out of cash earnings but out of "capitalized interest" - that is, out of the increase in loan balances on OptionARMs.  The problem with this is that Capitalized Interest is not money - it is a promise to pay in the future and in this case that promise was being made on an asset (homes largely in California) where their decline in value had already begun.  It was clear to me at the time that this bank along with many others needed to be seized immediately to prevent an all-on systemic meltdown, and I said so in plain English. 

They weren't and we did.

Next up we have this proposed FINRA rule:

FINRA is proposing to adopt NASD Rule 3310 (Publication of
Transactions and Quotations), NASD Rule 3320 (Offers at Stated Prices), IM-3310 (Manipulative and Deceptive Quotations) and IM-3320 (firmness of Quotations) as FINRA rules in the consolidated FINRA rulebook without material changes. The proposed rule change would combine NASD Rule 3310 and IM-3310 into FINRA Rule 5210 and would combine NASD Rule 3320 and IM-3320 into FINRA Rule 5220 in the consolidated FINRA rulebook.

This is rather arcane, but the gist of it is that apparently laws and regulations standing since 1939 and 1960, adopted to prevent the practice of disseminating a price (bid or offer) on a stock exchange that one does not intend to honor, have somehow been gamed by recent "technological innovations" (is this due to "High Frequency Trading"?) and thus requires restatement in a more-consolidated and more-airtight form.

Is not the substance of this announcement that in fact firms have been publishing bids and offers they have no intention of filling - that is, under the rules standing since 1939, people have been getting screwed due to "technical" violations of those regulations?  More to the point, isn't offering to buy or sell something when you have no intention of actually doing so commonly defined in the law as FRAUD?  If so, why is FINRA "tightening the rules" instead of the FBI  referring evidence of current and past conduct to federal prosecutors and Grand Juries for the purpose of laying criminal indictments?

How in fact is this different in substance than claiming on one hand that a security is "a great investment" and on the other hand calling it "vomit"?

Now let's talk about Elizabeth Warren's grilling of Tim Geithner yesterday in Congressional Oversight Panel hearings; you can watch the entire thing on http://CSPAN.ORG if you wish, or wait for this weekend when I will have excerpts along with my own commentary on YouTube.

The key item here is this: Ms. Warren grilled Tim Geithner about the payments to AIG to "prevent default" but nowhere does she, or anyone else, ask how it is that the NY Fed and US Federal Reserve, both of which regulate these institutions, came to allow banks under their umbrella to enter into transactions with a firm - in this case AIG - that had no money to make good on its transasctions IN THE FIRST PLACE.

Is it not fraud to sell someone something that you can't possibly, on the pure mathematics, deliver on?  I think so and there are rumors that there is now a grand jury looking into the matter.

Leave the grand jury aside for a moment: The Federal Reserve and Treasury's various "arms", including the FDIC, OTS and OCC, all had regulatory oversight over some part of these firm's dealings with AIG.  For the investment banks the link was more limited than it was with traditional bank holding companies, but post Bear Stearns when investment banks were given access to the discount window The NY Fed and The Federal Reserve formally had supervisory access and control over these firms sufficient to discover and force an unwind of these transactions.  Yet they did not, and remember, Geithner was in charge of The NY Fed at the time.

Neither institution did a thing even though nothing more than a cursory look at the liquid assets that AIG held and declared on their balance sheet and the size of its derivative book was sufficient to discern that their leverage ratios made it impossible for them to cover these bets should anything go wrong.

The regulators did not care.

It gets worse. 

The Bush Administration went to court to block state laws that prohibited certain subprime lending practices, including but not limited to capping late fees and prohibiting prepayment penalities.  Court decisions were handed down in 2004 that effectively voided state laws that, had they remained in force, would have prevented much of the subprime housing explosion - and a great deal of the bubble itself.  These laws declared those practices contrary to the public interest and thus void.

The Federal Government sided with the purveyors of what State Legislatures stated in statute were fraudulent lending practices - and won through Federal Courts of Appeal, at which sit federally-appointed judges.

Read that again folks: Practices declared as a fraud upon the public by state legislatures in the form of formal statutes after public debate, resulting in the passage of state law, were ruled LEGAL by The Federal Government if undertaken by a federally-chartered bank, even if the entire transaction (both the bank's office AND the resident) were wholly inside a given state's lines.

There are other not-so-amusing tidbits surrounding apparent lawlessness in our government, such as the newly-surfaced piece on Canada Free Press in which it is disclosed that The Democratic Party nomination certification for our recent election sent to the states DIFFERED from the one signed at the convention, and was missing THE KEY ELEMENT to qualify both President Obama and Joe Biden: Certification that they were vetted and found elegible to hold their offices.  Kooky?  Coincidence?  An accident?  Maybe.  Or maybe not.  Read the Canada Free Press piece and look at the documents yourself - then decide.  I did - the two DNC documents clearly came from the same place - the spacing and a typographical error are identical in both, but the one sent to at least some states is missing the essential certification.

Why?

And more importantly, why did nobody in the Democratic Party - anywhere, among the 50 states - raise hell about this and demand a proper certification of ballot qualification under penalty of perjury more than a year ago?

And now, in the last two days, we have two separate stories regarding ACORN in two separate cities.  In both cases an independent filmmaker (and fabulous new muckraker!) showed up with an undercover video camera (nice job hiding that sucker!) along with a young lady, with him posing as a pimp and her as a prostitute.  Their purpose?  To see if ACORN could "help them" with getting loans, defrauding the IRS, and conspiring to bring into the country illegally underage girls for the purpose of prostitution!

Did ACORN throw them out of the office and/or call the authorities?  No; they instead provided advice and assistance.  Remember, ACORN is linked closely to our current President and was instrumental in his election. 

ACORN has been accused of various voter fraud schemes in the past.  They've been relatively immune to any sort of "real action" on this simply because when you send a bunch of people out into the field to collect voter reg cards and they come back with a few that have "Mickey Mouse" on them you can hardly claim a systemic intent to commit fraud unless you can find a smoking gun - someone who told them to go do that - and nobody has been able to.

But this is different.  Now we have two different ACORN offices in two different cities in which essentially the same question was asked and the same advice given.  On videotape.  

Of course one office "immediately fired" the people involved, but the "isolated incident by a low-level employee" argument - which ACORN tried to run - went up in smoke this morning when the second tape surfaced.

How many more tapes are there? 

How many more offices?

And how much of the media is complicit in hiding not just THIS scandal but all of the others?

From James O'Keefe this afternoon:

So far CNN has only reported on the breaking story on blatant ACORN CORRUPTION from angles that attempt to extricate the government funded community organizing  enterprise from the extreme crime we caught on videotape.

First CNN pushed the false ACORN line that [t]his film crew tried to pull this sham at other offices and failed.

To set that record straight please check the Washington D.C. tape we dropped today at BigGovernment.com, which is also being aired on your cable news competitor with curiously higher ratings.

Now that ACORN lied to you, Jonathan Klein, what are you going to do?

Heres what I have noticed from your coverage: You brought in the damage control crowd to FRAME the story. Before even airing our damning Baltimore video. You know your audience would turn on ACORN if you showed them the evidence. So instead you put your competitors in journalism in the crosshairs instead of airing a blockbuster report making massive waves elsewhere.

You even trotted out shameless Clinton era apologist Joe Conason to challenge the ETHICS of our expose. Unreal.

What about the ethics of those at ACORN caught on tape trying to help create a brothel featuring illegal immigrant age range 13-15 from El Salvador?

What about the countless laws broken on tape from a group that stands to get billions from President Obamas stimulus package?

James, there is much more here than just an organization that appears to have had two different offices offer "help" in creating child prostitution rings with girls unlawfully brought here from El Salvador, and frankly, that you blew the door off the container from this angle, while refreshing, has only exposed the first little piece of rotten carcass inside that boxcar.

Lest you think I am launching a partisan attack in this piece, think again and read again.  I am doing no such thing.  The clear evidence of lawless behavior and willful disregard for the foundational principles on which this nation was built and became great has been evident in the actions of both Democrats and Republicans over the last decade. 

What's worse, both parties and the mainstream media are unwilling to examine this issue from the top down except to the degree they can make political hay on the other side of the aisle, willfully turning a blind eye to the evil and outrageous actions of those who wear their own political badge - or who are willing to make a "campaign donation."

The fact of the matter is that it appears to this writer that we no longer have a Constitutional form of government in The United States.

No nation can have a strong, functional economy when the government either turns a blind eye to looting by certain favored groups and people or conspires in the theft and fraud itself.

No nation has the right to claim a legitimate government when it displays, on a non-partisan basis, blatant evidence of not only fraud but the willingness to sanction the abuse of children as sexual slaves.  Worse, when such practices are exposed we have the State Prosecutor of Maryland threatening not those who handed out such advice but rather the people who exposed it!

No nation has the right to claim a legitimate government when it declares preempted and void anti-fraud laws passed by State and Local governments that are intended to, and in fact do, operate to protect the citizens from the practices of certain private institutions that said State Government has declared through due process of law fraudulent, abusive and predatory.

Our nation's legitimacy is literally on the edge of collapse, and if we lose that, we lose the rest - our economy, our government, and our nation.

Just exactly how far do our "leaders" think this will be allowed - if not by the citizens of The United States then by our creditors and commodity suppliers upon whom we are absolutely dependant - to go?

Back on July 7th I wrote a piece on Health Care Reform and laid forth some general principles.

I have since done some more synthesis on this and have a more-fully-fleshed out, and yet simpler, set of proposals to solve the problem.  With no further ado, here they are:

If you sell "insurance" to anyone in a given state, you must accept all persons in that state on the same terms and at the same price.  If an insurer has a "we accept anyone at the same price" policy for a business, you must be able to buy into their plan for the same amount of money that the employer is charged on a per-person basis.  That is, all plans must be "open enrollment" for everyone within the state - period.  This immediately gets rid of the "tie" between employment and health "insurance", and it also removes one of the biggest issues that small business and self-employed people face - the inability to buy insurance at any reasonable price if there has ever been anything wrong with them medically.  The solution to the "adverse selection" problem is identical to that which exists in corporations - you typically can only elect out or in of a policy or plan on an annual basis - that is, you're obligated to participate for a full calendar year.  Enforcing the same terms (you can only opt in during one month, and are obligated for the entire year) solves the problem of someone deciding to buy only when they get ill, as you would have to wait for the enrollment window to open.  For acute conditions where adverse selection becomes most important this restriction resolves the problem.

All "insurance" companies must offer a true insurance policy covering only unlikely-but-catastrophic events on the same terms as their "full service" policies.  These were formerly called "major medical" or "hospitalization" policies, and have become very difficult to find.  They're relatively inexpensive as they do not cover routine doctor's visits or medications, but do cover catastrophes (e.g. a heart attack, cancer, stroke, etc.)  We must provide consumers with a reasonable-cost alternative to HMO/PPO coverage, and this is it.  If a company wants to sell "full-featured" policies that are unaffordable to a huge percentage of the population, we must mandate that they also offer affordable catastrophic coverage for those who prefer it (or can't afford anything else!)

All health providers must publish a price list and may not bill or accept payment at anything other than that price; doing so becomes a violation of Robinson-Patman and exposes the provider to civil suit for treble damages.  This instantly stops the practice of billing the uninsured or privately insured at a higher price than Medicare, for example - a practice that is rampant, particularly among hospitals.  Every hospital has a detailed price list for every function and thing in their health care panoply - this enforces even billing and even pricing for everyone, without discrimination.  The complaint that health providers cannot make a living at Medicare's reimbursement rates does not give that provider license to cost shift the expense of government-subsidized care to privately-insured or uninsured patients.  That sort of discrimination is outrageous and must be made unlawful.  Everyone would raise hell if your car was three times as expensive if you worked for Ford than if you worked for GM, yet it is accepted that if you're not insured by Kaiser (for example) your heart bypass surgery costs a different amount.  If Medicare's "price schedule" is inadequate the solution is for providers to refuse to provide the service at that price, not cost-shift the care of older Americans onto younger.  This is a more than $200 billion dollar a year rip-off of working-age Americans and it must end.

No event caused by the provision of your treatment may be billed to you.  Period.  Specifically, MRSA infections and similar contracted in a hospital cannot result in billing of that treatment to the consumer.  If you call someone to fix your roof and they break a picture window, they have to eat it - they can't bill you for the roof and the window which they broke!  The best incentive for better-quality care, particularly when it comes to controlling in-hospital cross-infection rates, is to make it ruinously expensive for hospitals to fail to prevent these adverse events.  Prohibiting by federal law the billing of any amount for a condition caused by the provider of health care (or a health facility) puts in place a very strong free-market disincentive for lax infection and process control. 

If you show up without insurance or ability to pay with a life-threatening condition, you will be treated, but the hospital cannot cost-shift the bill - it instead bills The Federal Government.  We have created an expectation that if you show up needing emergency treatment you will get it, irrespective of ability to pay.  This creates a monstrous problem for hospitals and results in the $30 aspirin, among other outrageous distortions.  The solution is to have The Federal Government receive all uninsured and unpaid bills, with the debt being immediately paid by the government.  Said debt then becomes a collection item against the citizen - a debt to the Treasury, administered by the Internal Revenue Service.  If you cannot pay cash, that's fine - the IRS will be happy to take payments (at interest.)  If you're an illegal alien the Federal Government will be mandated (by statute) to collect from the other nation, and if they refuse to pay, to deduct any such amount from foreign aid of any type and source on a dollar-for-dollar basis.

Five points and a fully free-market solution that brings affordable health care coverage to all who can buy it, yet protects those who cannot, while, to the greatest possible extent, forces everyone to bear the cost of their own decisions.

If you choose not to be insured and pay cash you are free to make that choice.  If you have a catastrophic illness or injury, insist on treatment but have no means to pay then you are subject to attachment of wages and assets by the IRS, a debt that is only discharged by your death.

Simple, fair, free-market and this path will dramatically control costs as free market competition will be forced to the forefront among health providers who will be compelled to make available their pricing schedules to everyone before they show up for treatment and are presented the bill.