Feb 23, 2012 | Economy, Healthcare, Take Action, Tea Party
By Dr. Harold Pease
Both parties have succumbed to the temptation of getting elected by promising ever more goodies from the public coffers, irrespective of constitutional limits, and to the point that they have irresponsibly enslaved our children with 15.25 trillion dollar indebtedness.
Everything is talked about in the presidential debates except this. We will just pretend it away. Why? Because both parties know that the cuts that have to be made to save the terminal cancer patient have to be drastic and advocating such to a population drunk with the idea that they are entitled to such is political suicide. Congress appears to be, or is, inept in solving this and other debt related problems.
Predicting a Super Committee failure, Freedom Works, a Tea Party affiliate, selected 12 of their own members and through the Internet invited 150,000 members to make suggestions on what should be done. Boldly they opened the unfunded liabilities door, Pandora’s box, the door neither party dares to open as potentially it could destroy career politicians and political parties.
What follows are their recommendations with respect to Medicare and Medicaid. Almost everyone knows that Medicare, 13% of the federal budget, growing at about 7% each year, is unsustainable. Formerly the favored method of controlling expenditures in this area was to limit reimbursement rates to healthcare providers rather than focus on fraud and the use of the free market to limit costs.
The Tea Party Debt Commission saw the Medicare program as outdated, inefficient, and corrupt and recommended six major changes that if followed would save, they predicted, $676,000,000 the first year and $2,030,843,000,000 in 10 years. These changes are first “let individuals opt out of Medicare under Senator Jim DeMint’s ‘Retirement Freedom Act.”’ Second, let all new Medicare beneficiaries after 2013 enroll in the Federal Employees’ Health Benefit Program (FEHBP) introduced by Senator Rand Paul as the “Congressional Health Care for Seniors Act.” Third, reduce Medicare subsidies to actual cost of hospitals’ graduate medical education. Fourth, maintain Medicare’s physician payment rates at the 2011 level. Fifth, convert the open-ended Medicaid program into a capped block grant to the states. And six, call on all states to reform their medical malpractice and product liability systems—tort reform.
Opting into the same Medicare program the members of Congress use, the second Tea Party change recommended, is much better for participants because it “relies on competing private insurers to provide benefits, and as a result has very little of the fraud and waste problems that plague today’s outdated and poorly designed Medicare system.” One wonders why Congress can make for themselves such a good system and leave us one with “somewhere between 10 and 20 percent of Medicare’s $450 billion annual budget being attributable to waste, fraud, and abuse….”
Converting Medicaid to block grants to states, Tea Party Debt Commission recommendation number five, is critical in stopping Medicare’s open ended liability. They argue that the program “has exploded into a semi-middle class entitlement that is bankrupting the states while providing low-quality care to poor families.” The conversion to grants “would give states the incentives and flexibility to focus scarce resources on those who truly need help.” It would also incentivize removing fraud.
Their answer to excessive medical malpractice awards that drive up medical costs for everyone was recommendation number six, state tort reform. They especially endorsed the “loser pays rule” so successful in the states that have it. Here those unsuccessful in winning frivolous lawsuits are punished thus discouraging such by others, especially lawyers, looking to benefit off the taxpayer. I once knew a woman who busied herself with multiple simultaneous frivolous lawsuits as a source of income because those sued would prefer to pay her, because it was less expensive, than to defend themselves.
Bottom line we can keep Medicare, even making it more efficient and sustainable, with six changes. It is not too late, but we need to realize our danger and move quickly to do so. Will Congress explore these changes with intent to make them? Not unless you ask them to do so.
Dr. Harold Pease is an expert on the United States Constitution. He has dedicated his career to studying the writings of the Founding Fathers and applying that knowledge to current events. He has taught history and political science from this perspective for over 25 years at Taft College. To read more of his weekly articles, please visit www.LibertyUnderFire.org
Feb 17, 2012 | Taxes
By Dr. Harold Pease
President Barack Obama’s favorite president, as is the case with so many Americans, is Abraham Lincoln who shares a national holiday, Presidents Day, with George Washington. But this bond certainly could not be because of shared political ideology. Lincoln was for the free market and decidedly against socialism—just opposite of President Obama. He saw nothing in the Communist Manifesto, published in 1848, worthy of emulation.
On the ownership of property Abraham Lincoln’s feelings were especially strong, he said, “Property is the fruit of labor; property is desirable; is a positive good in the world. That some should be rich shows that others may become rich, and hence is just encouragement to industry and enterprises” (The Collected Works of Abraham Lincoln edited by Roy P. Basler, Volume VII, pp. 259-260). To him there was no need to take by force the wealth of those who produce and give it to those less productive. The “share the wealth” philosophy articulated by Obama as a presidential candidate in 2008 to “Joe the plumber,” would have been foreign ideology to the Civil War president.
The answer for the poor was not class envy, first identified by Aristotle some 2,500 years ago as being the natural inclination of those with less, a philosophy implemented by Lenin in Russia when the communists identified those holding property as enemies of the state and liquidated some four to eight million farmers, the “Kulaks” (“The Russian Kulaks,” InDepthInfo.com). Then they wondered why the country had such a horrific famine in 1921-1922. Lincoln’s answer to the poor, from which he sprang himself, “Let not him who is houseless pull down the house of another, but let him labor diligently to build one for himself, thus by example assuring that his own shall be safe from violence….”
Unfortunately, many in our society have forgotten the “labor diligently” part of his phrase and have come to expect the government to provide, from the industry of others, their every need. On that score Lincoln also had words. “You toil and work and earn bread, and I will eat it.” He viewed this principle as a form of tyranny to those who work. Today 47.5 % of the adult population pay no federal income tax; many actually receive benefits for which they have paid nothing.
Watching others acquire wealth was, in fact, a sign of a healthy economy for Lincoln. “I take it that it is best for all to leave each man free to acquire property as fast as he can. Some will get wealthy. I don’t believe in a law to prevent a man from getting rich; it would do more harm than good.” Nor would he have supported the hundreds of laws that we have today that disincentivize a man trying to acquire wealth.
Lincoln might have added, “When has a poor man ever created a full time job for anyone?” Hate the Wall Marts or the McDonalds all you want but they provide the poor thousands of jobs. Do not bite the hand that feeds you then wonder where the jobs and prosperity went as did the early Russian communists. The “share the wealth” philosophy, which Lincoln opposed, has never brought long term general prosperity for any people, any place, or any time.
Dr. Harold Pease is an expert on the United States Constitution. He has dedicated his career to studying the writings of the Founding Fathers and applying that knowledge to current events. He has taught history and political science from this perspective for over 25 years at Taft College. To read more of his weekly articles, please visit www.LibertyUnderFire.org
Feb 12, 2012 | Take Action, Tea Party
Dr. Harold W. Pease
With our national debt growing by $4 billion a day and Congress giving up offering any real solutions, we are a speeding train heading for a cliff. Most pretend the problem is not real or will just go away. No presidential candidate but Ron Paul even talks about it. Almost no one is ready for the hyperinflation and street crime that could follow if we do not act quickly and responsibly.
The Tea Party Debt Commission was formed to provide the federal government a solution. Its final report summarized the problem, “Our government is doing too many things it can’t do well, or shouldn’t do at all, with money it doesn’t have. We are borrowing 43 cents of every dollar we spend….” They note that the “Government Accountability Office counted no fewer than 47 job training programs, 56 financial literacy programs, 80 economic development programs, 18 food assistance programs, 20 programs for the homeless, 82 teacher-quality programs spread across 10 agencies, and more than 2,100 data centers. All told, we have nearly 2,200 federal programs.” Government is bloated, inefficient, and wasteful.
A federal diet is long overdue, but what should we keep? The Commission’s assessment criteria hinged on four basic values: fiscal common sense, Constitutional limits, economic freedom, and personal self-reliance. For a program to remain, they reasoned, it needed to pass two questions: is it constitutionally authorized, and is it best carried out by the federal government, as opposed to states or private entities? Much of what the federal government does, the Commission found, unfortunately, does neither.
Boldly they opened the unfunded liabilities door, the door neither party dares to open as potentially it could destroy career politicians and political parties. They concluded that they could make Social Security “sustainable and actually improve benefits by harnessing the power of compound interest.” They noted, “Three decades ago, Chile embarked on a bold transformation of its retirement security system. Today, that system [SMART Accounts] is the envy of the world, giving seniors far better benefits than the old, government-run system ever did.”
Shortly thereafter three counties in Texas adopted the SMART Accounts program in favor of personal accounts and thus those retiring today do so “with much more money and have significantly more generous death and disability supplemental benefits than do Social Security participants.” Moreover, they “face no long term unfunded pension liabilities.” The Commission recommends that, “all state and local governments should have the option of opting into the ‘Galveston model.’ ” Learn more about this aspect of the Tea Party Debt Commission’s recommendations by visiting FreedomWorks.org/the-tea-party-budget.
The Tea Party Debt Commission suggests that “new workers born after 1981… invest one-half of their payroll taxes (7.65%) in a SMART Account, which they can use to fund their retirement and health care costs in retirement. If they prefer, they can give up their account and opt back into traditional Social Security at retirement.” The result of this modern approach to funding retirement embraced by the Commission, is that, among other things, it: “improves benefits, doesn’t increase the retirement age, doesn’t cut benefits for people in or nearing retirement, and doesn’t touch the existing Social Security Disability insurance program.” It also “reduces federal payroll tax receipts by about $500 billion over the ten-year period.”
The Commission also opened Medicare, the second major Pandora’s box of unfunded liabilities, but Tea Party recommendations giving Medicare seniors the right to opt into the privileged Congressional health care plan will require space not permitted here. It is, however, great stuff for a subsequent column.
The speeding train does not have to go over the cliff. There are great thinkers and solutions that can save us because they are not forced to do so within the parameters of self-interest and political parties. Fortunately the Tea Party works successfully outside these restrictions. Please tell your Congressman to seriously explore these recommendations especially in light of the fact that their plans have not worked. This train must get off the track that it is now on while there is yet time.
Dr. Harold Pease is an expert on the United States Constitution. He has dedicated his career to studying the writings of the Founding Fathers and applying that knowledge to current events. He has taught history and political science from this perspective for over 25 years at Taft College. To read more of his weekly articles, please visit www.LibertyUnderFire.org
Feb 1, 2012 | Constitution, Economy, Taxes, Tea Party
By Dr. Harold W. Pease
The French philosopher Alexis de Tocqueville in 1840, once prophetically said, “The American Republic will endure until the day Congress discovers that it can bribe the public with the publics’ money.” That day is here!!
Both parties have succumbed to the temptation of getting elected by promising ever more goodies from the public coffers, irrespective of constitutional limits, and to the point that they have irresponsibly enslaved our children with 15.25 trillion dollars indebtedness. Both parties are blatantly guilty with democrats far more so the last three years. The national debt has increased at an average of 4 billion dollars a day under President Barack Obama. The seriousness of this led Admiral Mike Mullen, Chairman of the Joint Chiefs of Staff to exclaim, “Our national debt is our biggest national security threat.”
Last summer both big government parties, Democrat and Republican, unable to come to any agreement, turned their authority over to what was called a “Super Committee” of six democrats and six republicans and still could not reduce the debt by 1.2 trillion dollars over ten years. Impasse!!
Everything is talked about in the presidential debates except this national security threat. We will just pretend it away. Why? Because both parties know that the cuts that have to be made to save the terminal cancer patient have to be drastic, career politicians, which they are, do not want the media to blame their party—which it will! So, the ship (the United States) will sink for lack of real leadership, each party blaming the other.
Not so fast! The Tea Party Patriot movement comes to the rescue again. They predicted correctly that neither party really represents limited constitutional government and both are addicted to debt. It is like an addict prescribing his own detox program. Consequently Freedom Works, a Tea Party affiliate, selected 12 of their own members and through the Internet invited 150,000 members to make suggestions on what should be done.
The Tea Party Plan cuts, caps, and balances federal spending. The budget is balanced in four years, without tax hikes, and remains balanced. Federal spending is reduced by $9.7 trillion over the next ten years. The plan shrinks the federal government from 24 % of GDP to about 16 %. Finally it stops the growth of the debt and begins paying it down. Within a generation there would be no national debt. Bold indeed!
These goals are accomplished, their report continues, by repealing ObamaCare, eliminating four unconstitutional, costly, inefficient Cabinet agencies—Energy, Education, Commerce, and HUD—and reducing or privatizing many others, including EPA, TSA, Fannie Mae, and Freddie Mac. The report calls for ending farm subsidies, government student loans, and foreign aid to countries that don’t support us—luxuries we can no longer afford. Social Security is saved and improved by shifting ownership and control from government to individuals, through new SMART Accounts, a program successfully tried in Chile. It gives Medicare seniors the right to opt into the special Congressional health care plan. Moreover, it suspends pension contributions and COLAs for Members of Congress, whenever the budget is in deficit.
The new plan offers a rational transition to ownership of our own retirement and more control and choice over our health care. Why did the government fail to accomplish the same thing—even behind closed doors? Remember, Congress, as Alexis de Tocqueville predicted, has learned that it can bribe the public with the publics’ own money. Their first concern is to protect their jobs and party. Outsiders, without a personal stake in the outcome, can see much more and do much more without the inevitable political wrangling. Will the media give this plan a fair hearing or will they simply ignore it?
I will follow in another column with Tea Party specifics on dealing with unfunded liabilities in Medicare and Social Security which the two big government parties will never talk about.
Dr. Harold Pease is an expert on the United States Constitution. He has dedicated his career to studying the writings of the Founding Fathers and applying that knowledge to current events. He has taught history and political science from this perspective for over 25 years at Taft College. To read more of his weekly articles, please visit www.LibertyUnderFire.org
