Another (Sad) Casualty Of Schwantz-Gobbling
The Market Ticker - Commentary on The Capital Markets
2017-01-09 05:00 by Karl Denninger
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Another (Sad) Casualty Of Schwantz-Gobbling
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The other day I was compelled to do something that made me rather sad -- I formally told someone who has been an associate of mine for many years to remove me from his distribution and contact lists.

The triggering event was a public, social-media statement that was predicated on (and included) a knowingly false statement of fact related to me -- which was in reply to my going after Trump and his appointment of Price for HHS.

Folks, we are where we are in this country when it comes to the impending destruction of our nation, our economy and our political system along with the federal budget and all programs funded by same as a direct result of people in this country on both sides of the aisle being willing to anoint their particular favored candidate God when he or she wins.

This in turn has allowed multiple politicians over the last couple of decades from both parties to engage in the literal******of the American people's pocketbook, wealth and future both in the areas of education, which is horribly bad, and worse in Health Care which, due to its size and government involvement threatens the future of this nation and our way of life.

We watched this with Obama, who came into office with great fanfare and expectation by half of the nation (and dislike by the other half) who then rammed Obamacare through a Congress he controlled in its entirety.  Now Trump is President and he also has a Congress he controls in its entirety.

On the educational side both parties have participated in turning college into an asset-stripping festival for both schools and lenders, destroying the personal value of an education for almost everyone -- and both parties have been equal participants.  Both parties, among other things, were involved in making student loan debt not dischargable in bankruptcy, both propped up Sallie Mae and ultimately bailed it out with even more policy changes and neither has done a thing to reverse either of those steps or the never-ending federal support of the cost-spiral and debt that has made post-secondary education a bad deal for the vast majority of young adults where it was formerly a good deal for virtually everyone.

It is one thing for an individual with no particular influence beyond their own personal friends to refuse to look at the arithmetic of a matter like this and act on it, or to dismiss one politician or party's malfeasance while aggressively disliking the other.  That's why we're in this mess but if you do that as an individual it is only through the collective acts of everyone like you that the harm occurs.

But if you are in any way involved in public life -- you're a member of the media ("organized" or "independent", doesn't matter), you've run for office or are now running for office or are in any other way in the public eye your acts are no longer simply the singular acts of an individual -- they now are intended to, and do influence others on a larger scale.  This is particularly true if you make any part of your living from those activities, and if it's your sole source of work-related funds then literally everything you gain from society is being gained due to a lie -- a lie that is screwing every American blind.

I can't sit for that nor associate with people who knowingly participate in it.  I didn't when Obama was President and I won't now that Trump will be.  I lost a bet during the campaign which I willingly and voluntarily paid off (I bet that Hillary would not be nominated, likely because she would get indicted first) and at no time did I believe she'd win (in fact I published my own expectations for the electoral college map shortly after the conventions) nor did I in any way support her personally or her candidacy.

But that does not mean that Trump gets a pass from me on this issue, which is one that has no partisan boundary to it and if not attended to will destroy our nation.  Trump's nomination of Price for HHS is proof that he has zero intention of fixing anything related to the health care mess and in fact will enable the medical industry to screw you longer and harder, giving that screwing the force of law for Seniors through what is known as "Balance Billing" -- a practice Price has not only endorsed he previously tried to get it passed into law for Medicare recipients.

I remind you that Obama managed to buy two whole years of much-slower Medicare and Medicaid spending growth with his massive changes to the medical system including trying to force everyone into the scam via Obamacare.  Two years folks -- that's all -- and in doing so he made resolution of the problem much harder.

Trump's pick for HHS, Price, has previously declared an intent to try to stave off the collapse by literally raiding the entire net worth of every Senior citizen.  I don't believe he will get more than two (additional) years out of that stunt but if he was to pull it off that might delay the detonation until Trump leaves office -- eight years hence.

The Senate is well-aware of the issue.  A few years ago I was invited to a meeting of a handful of top aides to Senators to talk about the budget trajectory and its impact.  I pointed out that on the math there was only one area of the budget that mattered -- this one.  It is clear on the basis of simple arithmetic that we are screwed unless this issue is addressed and there is only one way to do it.  The people in the room did "get it" but bemoaned the political ramifications of taking it on and they have done nothing effective since, allowing politics to win over math -- for now.  This was during the time of the "debt ceiling" debacle -- several years ago -- an event that ultimately led me to tell McMorris-Rodgers to perform an anatomically-impossible act.

Listen to what they're saying today:

"I don't think we can just repeal Obamacare and say we're going to get an answer two years from now," he said Thursday on MSNBC.

"We haven't coalesced around a solution for six years, in part because it is so complicated,” he also said. “Kicking the can down the road for a year or two years isn't going to make it any easier to solve."

With Trump as president and fellow Republicans controlling Congress, the GOP indeed finally has an opportunity to repeal the law.

But nothing about revamping the nation's $3 trillion-a-year health care system will come easy, with congressional Democrats vowing the stop Republicans at essentially every step.  

The solution is to take that $3 trillion a year system and make it a $1 trillion a year system.  Doing that will resolve the entire federal budget deficit and debt problem, it will resolve all of the state and local pension issues related to retiree health expenses (that's most of it) and it will permanently end the depreciation of our currency, which screws everyone.  It will also make America far more competitive as a place to do business and thus attract jobs and firms here from other nations, going a long way toward addressing both offshoring of labor and our trade balance.

It is not only possible to do this it can be done, for the most part, using existing law.

There has been zero discussion or statements made about doing the one thing that will actually fix the problem: Enforcing 15 United States Code against all medical and health-insurance related firms.  We could start by enforcing Robinson-Patman, which federally bans price discrimination for buyers of like kind and quantity, against pharma firms and hospitals.  We could enforce the anti-collusion components of Sherman and Clayton against everyone, and indicting anyone who won't post a price and charge the same price to everyone without regard to how they pay. In short we could take the monopolists in both insurance and medicine out back behind the woodshed and offer them a choice -- either cut it out, right now, or go to prison under 100+ year old already-existing law and have your corporation ruined with $100 million per-count fines, and remind them that we will tally every person that gets screwed as a separate and unique count.

I remind you that Obama doesn't care that Obamacare is detonating because it is happening after he leaves office and likewise Trump will not give a good damn what happens after he leaves office -- even if it's only by a month or two!  I correctly forecast, on the math, that Obamacare would detonate and it is no surprise to me whatsoever that it is doing so now as he is on the verge of leaving office.

Why hasn't anyone from the Senate, including so-called "libertarian" Rand Paul, raised and pressed this?  Because doing so will mightily***** off a whole bunch of K-street lobbyists and people in the "industry" that have been running federally-enforced financial******rooms for everyone in this country for the last 30 years.  Dismantling the screwing they have forced Americans into will mean many of those people lose their jobs, many more will see their incomes cut to a monstrous degree and in the short term a 12-15% hit to GDP will take place.  It won't last long because that output will be redirected into other, more-productive pursuits, but the short-term pain and blaring of "Recession!" in all the major media, along with a massive downward stroke in the stock price of every firm related to this scheme carries political risk that none of these people will take -- even if not doing so will destroy America financially and they all know damn well that it will with absolute mathematical certainty.

If my refusal to shut up about this issue and "give Trump a pass" means I wind up being labeled Deplorable, Irredeemable and all the Trump schwantz-gobblers attack me as well because I will not fall to my knees and take a turn on the Presidential knob then I guess I'll have to settle for a purring cat, my (now adult) kid and leaves on trees in the woods as my list of "friends."

So be it.

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