How Republicans Win 2012 – Options

For my 100th blog post,  I decided to let you in on how the Republicans can create a strategy that will improve our system and economy, resonate with voters, and defend against Democrats.  It all comes down to one thing, giving citizens options.

I love having options, it is essentially a form of freedom.  I believe Republicans need to develop programs where people can choose between the current system and a new system.  Giving citizens the option between old and new eliminates the fear of the new.  Further, Democrat’s entire election campaign is around generating a fear of the Republicans.  For example, they have commercials of a Paul Ryan looking figure pushing granny off the cliff.  Just this past weekend, David Axelrod labeled Republicans a “reign of terror.”

I want to give a you few examples of options:

• Social Security –> the Chilean model essentially privatizes gains and socializes loses.  Basically, people would be given the option to stay with the current system or invest a portion of their social security dollars (instead of paying the full tax) to a private investment.  If the private investment does not meet the payout they would have received with the government social security check, they are paid the difference by the government.  It benefits the citizen because people typically get paid more privately than with social security, less money is paid out to citizens because their investments worked, preventing the system from going bankrupt, and there are still people paying in for those who want to stay on today’s version of social security.
• Medicare –> Did you know it is cheaper for us to pay citizens about $15,000/yr. for them to get their own private insurance than it is for them to be on medicare?  If we give people the option to do the private version, we would save money, even if only 10% did it.  Further, insurance is all about risk for the insurance companies.  If they have a larger pool of people paying in, it reduces the risk for them, increasing their ability to make insurance more affordable..
• Tax Code –> What if we had the ability to choose between the current tax code and paying a straight 20% of earned income without any deductions? If I had the option of paying a straight 20% instead of going through the confusion of our current model, I’d probably choose the easy path.

Obviously, the examples I gave are extremely complicated.  However, I wanted to illustrate some ways that we could create platforms that provide options.

I believe Republicans are trying to convince the American people that we need massive changes.  However, people do not like change, especially big change.  The public opinion of an entire nation cannot turn like a speed boat, it is more like a massive air craft carrier that takes miles to slowly turn around.  By offering options, it allows people time to get comfortable with big ideas.  The great thing about the private options presented is they will naturally become popular because they will typically put more money in people’s pockets.

Romney and Republicans need to market options more than the big ideas.  They need to tell Democrats, “If you like the current system, keep it.  Meanwhile, us 50% of Americans (the Republicans) will take the private options, make more money, and help cut the national budget.  You’re welcome Democrats…you’re welcome!”

Spending Cuts in Washington – It Has to Hurt – Part 2

My last article talked about why we need to make cuts that hurt.  This article takes another look closer at where the revenue comes from and how our government spends their money.  When you want to solve a problem, the first step is to figure out the “as-is.”  In short, understand the situation and the problem before you make decisions based on feelings rather than factual information.

I want to show you where we get our money from and how we spend it:

What you need to know:

• In 2010, our government spent $3.456 trillion and had $2.162 trillion in revenue, creating a $1.294 trillion deficit.
• To break even, we would’ve had to reduce our spending by 37% or increase our revenue (taxes) by 60%!
• Social Security/Social Insurance revenue is $865 billion and spending on Social Security/Medicare/Medicaid is $1.494 trillion, creating a $629 billion shortfall in those few programs alone.
• Medicare/Medicaid spending in 2007 was $599 billion and in 2010, it was $793 billion, a $194 billion (32%) increase in just 3 years.
• When Social Security started, there were roughly 30 employees for every retiree, and now there is approximately 2 employees for every retiree, creating budget shortfalls.

Now that you understand the problem a little bit more, do you believe President Obama’s spending freeze is going balance our budget?  Even if we froze our discretionary spending, the increases in Medicare/Medicaid alone are going to bankrupt us.

As you look for 2012 Presidential and Congressional candidates, look for those people that are saying outrageous things because they are probably the ones that really get it.

Why Everyone Needs to Pay Taxes

As you can tell, I am kind on a tax binge right now – I just wrote about the fair and flat tax systems and why I think they could make a good hybrid system.  I want to clarify that the reason I want everyone to pay taxes is not because I hate the poor, but because they need to be part of the system.

In Greece this past year, their country essentially went bankrupt.  Germany and other EU countries decided to help bail them out under some conditions.  Most of the conditions were getting rid of their entitlement program, including their public healthcare system, because it was costing them so much money.

Tim Pawlenty put it great in his new book, “Courage to Stand” (page ix), “There were protests and riots in the streets as a populace so addicted to entitlements and living the good life off the government dole faced the harsh reality that they might have to sacrifice what the government had promised them–because the government simply had no more money to pay for it.”

The citizens of Greece did not understand that the money did not fall from the sky.  You do not understand the value of something if you do not have to pay for it.  I valued my law school degree over my elementary education because I am still paying for my law school.

We vote for people we think will spend America’s money the way we think fit.  If you are not paying anything into the system, it is going to affect how you want that money to be spent.  Even if it is just $100 a year, I think it is important that people pay something so it prompts them to ask, “What are they doing with all my money?”

Why I’m Worried!

I had a liberal friend of mine ask me, “Why are you so worried about this healthcare bill?”  President Obama asked the same question, making the same joke twice about no meteors falling from the sky and that it is not armageddon.  When I sum up my thoughts on why I am so worried about our country and this bill, it essentially comes down to trust.  My trust has been broken by all of the broken programs that are filled with broken promises that are now financially broke.

There are two main reasons I am worried: past failures and current spending trends.

Past Failures:

It is difficult to say exactly what is going to happen with healthcare.  I have my viewpoints, but I cannot know for sure what is going to happen.  I can merely take what has happened in the past as an indicator of what is to happen in the future.  Here is what I have seen in the past:

• The U.S. Postal Service was established in 1775 and has a projected loss of $238 billion over the next decade.
• Social Security was established in 1935. Some experts say it is already broke, while others state that it will be broke in 2018 because there is a reserve fund that isn’t gone yet.
• Fannie Mae was established in 1938 and Freddie Mac was established in 1970.  In my opinion, they caused the housing crash and they are broke.
• “War on Poverty” started in 1964. Around $1 trillion each year is transferred to “the poor” who now feel entitled to programs.  In 2008, we still had 17.9% below 125% of poverty level.
• “War on Drugs” started in 1969 and right now 40% of our penal system is people in for drug use.
• Medicare and Medicaid were established in 1965. If you were to include the money they owe doctors and hospitals, they have an extreme amount of debt.
• The Department of Energy was created in 1977 to lessen our dependence on foreign oil. It has ballooned to 16,000 employees with a budget of $24 billion a year and we import more oil than ever before.

As you can see, this is not a Republican or Democrat issue, this is a government issue.  All of these programs have had years to be fixed by politicians and they just keep getting worse.  I simply do not trust that our government will do a good job with healthcare.

Current Spending Trends:

Over time, our government has continued to expand regardless of what party was in control.  Most people do not realize that our debt is getting so bad, that we may never be able to pay it off.  If our credit rating gets bad enough and countries do not think we’ll be able to pay it back, countries will stop lending to us.  I want to illustrate our unsustainable trends through charts.  While the trend shows that it is a government problem, not only an Obama problem, the failure of Obama to stop this trend and actually make it worse is what concerns many people.

It is pretty easy to see that we have a spending problem.

As you can see, our taxes continue to rise over time.

The CBO projected in January of 2009 that each person would have to pay $56,000 to pay off our debt.  That number rose to $72,000 in March, and now they are projecting that number will be at $170,000/person in 2020.  Some analysts think this number is conservative and that it could be much higher.

The bottom line is that conservatives are not just angry about the healthcare bill, they are angry and worried about the future of our country as a whole.  Looking at our past programs’ failures and our current spending trends, I think it is fair and logical to be worried…I know I am.

States Fight Healthcare Bill Constitutionality

In the same day that President Obama signed the Healthcare Bill into law, state Attorney Generals from over a dozen states filed lawsuits questioning the constitutionality of the bill.  The Justice Department issued a statement today, saying, “We are confident that this statute is constitutional and we will prevail when we defend it in court.”

A Rasmussen poll released today stated that 49% favor their state suing the federal government over Obama-care while 37% oppose and 14% are not sure.  States are listening to their constituents and fighting the healthcare bill in a number of ways (i.e. some are trying to pass laws that state people do not need to buy healthcare).  If you want to see what is going on in your state, click on this link to see a full list of what is going on in state legislatures.

So who is going to win?

While many conservative blogs will just make the argument for why they believe it is unconstitutional, I want to try to summarize the legal arguments that both sides will most likely make about the constitutionality of the healthcare bill.  I wrote an article a while back called Auto Insurance v. Health Insurance v. Constitution if you wish to read about the comparison of Auto Insurance v. Health Insurance.

There are three main arguments for the bill:

• First, the Commerce Clause allows the federal government to regulate interstate commerce.  Even though you cannot buy health insurance across lines, there is precedent that could allow the court to say that because health supplies or medicine may be shipped into a hospital from another state, healthcare is interstate commerce and thus, can be regulated by Congress.
• Second, federal government law supersedes state law, so even if the states have their own law, it would most likely be trumped by federal law.
• Third, Congress has broad power to levy taxes and they’ve cleverly written the bill as a tax, putting the IRS in charge.  The Supreme Court has given Congress broad power to tax and spend for the general welfare, a term that Congress itself can define.

There is essentially two main argument against the bill:

• First, you cannot punish someone in this country for not buying something they do not want to buy.  The 10th Amendment does not give Congress the right to force someone to buy some thing.  States have a lot of rights to regulate, but Congress only gets those powers given to them in the 10th Amendment.  Further, there is a 1992 Supreme Court case that states that Congress cannot impose a tax to penalize or control conduct.
• Second, using the Commerce Clause the way that it was originally intended would not allow Congress to regulate healthcare.  However, the argument is weak due to horrible precedent.

In the end, I think there is enough precedent out there that the Supreme Court can use to deem the bill as constitutional because of how much the constitution has changed in the courts slowly over the years.  I hope the Tea Party folks keep pushing their agenda because there is an opportunity for our country to go back to some of our constitutional roots.  According to a CBS poll, Harry Reid’s approval rating is 8% and Pelosi’s approval rating is 11%.  If we stay passionate, we can win back Congress in 2010.  With most of the programs not starting until 2014, there is time to stop portions of the bill.

Healthcare Bill Passes

The House passed the Senate Healthcare Bill 219-212 and the Reconciliation Act 220-211.   President Obama still needs to sign the bill Tuesday or later.  After the President signs it, the Reconciliation Act will go to the Senate to be passed.

Many conservative blogs will focus on how American’s did not want this bill and that it is an outrage.  My most recent post discussed the poll results to help you understand what people think.  However, many people were against the Iraq war with a similar passion and Republicans did not listen to them, so it is difficult to argue that Congress should do exactly what the polls say, although I wish they would have in this case.

That being said, I think this vote tells some important things about the parties:

Republicans: I have been critical of Republicans for spending too much under the Bush administration.  However, in this case (as well as the stimulus bill), every single Republican (all 178) voted against the bill.  The Republicans are building credibility as the party for lower spending and lower taxes.  Voters will not see the majority of the taxes and programs until after the 2010 election (as a lot of programs do not start until 2014), so the Republicans are still going to have to be innovative to win big in 2010.

Democrats: Democrats have an agenda and they are going to do whatever it takes to get things done, even if it means making back room deals and doing it without any bi-partisanship support.  I find it interesting that so many Democrats changed their mind at the last minute after pressure from leadership. Watch for a lot of pork to follow to support candidates who changed their minds as a payback.

This conservative blog has been fighting against the healthcare bill for quite a while and to do so now could potentially be repetitive (there are numerous healthcare articles I have written if you wish to partake).  Once everything is done, I’ll read the long freaking bill and try to offer more specifics.

This healthcare legislation is monumental; the only legislation I can think of that has been this big is social security and medicaid, which are both broke right now.  Maybe this government run program will be different, but I doubt it.

Healthcare Poll: Americans DO NOT WANT THIS BILL!

The most recent Rasmussen Poll from earlier this weekend revealed that America does not want the Health Care Bill that will be voted on by Congress today.  I am going to ignore the fact that the Democrats had to make “deals” to pass this bill, had to do it on a Sunday, which has the least number of people who watch the news, and stick to the facts of the poll:

• 54% oppose the bill, while 41% favor the bill
• Party Breakdown:
  • Democrats: 74% approve plan
  • Republicans: 87% oppose plan
  • Independents: 59% oppose, 34% favor plan
• 57% believe costs will go up, while only 17% believe costs will go down
• 54% believe the care will get worse
• 81% believe the costs will be higher than projected
• 57% believe the bill will hurt our economy
• 55% wish Congress would just start over
• 20% believe Congress will understand the bill before they vote for it

There are other polls, such as the Gallup Poll (48% oppose vs. 45% support), that are a little bit closer.  The only poll I could find that kind of says that people support the bill was MSNBC, which had 46% say it would be better to pass the president’s plan and make changes to the nation’s health care system, versus 45 percent who would prefer not to pass it and keep the system as it is now; they definitely worded the question interestingly.  However, in that same poll, 36% said Obama’s plan is good vs. 48% who think it is a bad idea.

In short, the Rasmussen Poll states that the majority of Americans think the bill will make costs go up, care will get worse, and it will hurt our economy – the exact opposite of what the bill hopes to accomplish.  No wonder the Democrats have had to play games in order to pass this bill.

Personal Responsibility/Self Discipline…America Misses You

In the last two days, I have had two things happen that have helped me to see the importance of personal responsibility.

Yesterday, I met with a mortgage lender to understand what amount I could get for a loan.  I was quite surprised by the fact that I was approved for a loan that was much more than we could afford.  It made me realize that I could get into a lot of trouble if I wasn’t careful.

Today, I was reading an article about obesity and according to the World Health Organization, by 2015 2.3 billion adults will be overweight and 700 million will be obese.

While these two thoughts are completely different, they both deal with personal responsibility.  Currently, Congress seems to be on a path to pass laws that protect us from ourselves, such as the proposed laws to ban soda from school cafeterias or trans. fat from food.  Regardless of how many laws Congress makes up, they’ll never be able to protect people from themselves. Period.

Self discipline has deteriorated so much that the personal responsibility has been replaced with a sense of entitlement.  People feel they are entitled to welfare checks, free health care coverage, a good paying job, and a college education.

Politicians bank on this entitlement to get into office by promising the world to voters.  The message resonates with people because they feel they deserve all of the items being promised.  Congress is spending billions of dollars to help people w/o addressing the root cause.  The days of “Ask not what your country can do for you, but what you can do for your country” are long gone.

It is easy to sit here and complain about this, but this strong conservative blog always tries to have solutions to go along with the issues.  For the time being, I think there are some things we can do, such as tackle welfare reform. In New York City, they were able to cut welfare recipients down by 50% during the late 90’s with work requirements, imposition of sanctions, and mandatory workfare jobs. I will get into this more in future posts, but essentially, the government took a firm stance that you at least need to try to get a job to get a free check.

For the future, I think our educational system needs to focus on teaching innovation and leadership, along with the basics.  With a more volatile job market, people need to learn how to promote and motivate themselves.

Lastly, I believe that everyone has a circle of influence and that we can encourage those around us to be self-sufficient.  I believe that parents can teach the valuable lesson that you have to work hard to make it and that life is not always fair.  I really do believe that teachers and school boards can implement education policy that teaches leadership and self-motivation.  I believe that coaches of youth leagues can keep score to teach kids (and parents) how to win and lose.  Also, I believe there are politicians out there that can inspire us to be better.  I hope they do not take the easy way out and promise what they cannot give, but motivate people to be their best.

We can either take responsibility for our future and lead our circle of influence or we can be complacent/hypocritical and complain about all the people who do not take responsibility.  It is kind of like all the people who say they hate people who judge others, even though they are judging that group of individuals themselves.

This is your time to change your routine, even if it is mentoring one person, so that we can begin to mold this country.

Health Care Legislation Context Makes Summit Moot

This conservative blog has stayed busy reporting when President Obama fails to keep his campaign promises.  During Obama’s campaign and his State of the Union Address, President Obama stated that he was going to tear down the walls in Washington and get both sides to work together.  President Obama did get both sides in one room during the Health Care Summit and I commend him for that.  However, I do not think it torn down many walls.

Republican’s big problem with President Obama’s approach is that he thinks that every time someone disagrees with him, it is political and not genuine disagreement. The big headline from the Summit was when President Obama said to John McCain, “The election is over” after McCain tried to make an argument for starting over in health care, being that Republicans have been left out of the process.

In November, the House passed their version of the health care bill (H.R. 3962) 220-215, with 39 Democrats voting “nay” and only one Republican supporting the bill.  The Senate passed their version 60-39 in December, with zero Republicans supporting the bill (one was absent during the vote).  Then, Democrat representative from both Houses sat behind closed doors to produce their final health care bill, deliberately leaving out Republicans.

Once the Democrats essentially had their final bill, they held the Health Care Summit.  When Republicans asked to start over, hoping to have an opportunity to be a part of the process this time , President Obama stated “We cannot have another year long debate over this.  If we can’t [agree on something in the next several weeks], then we’ve got to make some honest decisions, and that’s what elections are for.”

Because Democrats refused to let Republicans play a part in the process and were unwilling to be swayed by Republican ideas during the Summit, it was somewhat pointless to have the Summit.  Congresswoman Michelle Bachmann said, “We accomplished more at the White House Beer Summit than we accomplished today at the White House Health Summit.”

I do think the elections will help Democrats see who supports their Health Care bill and I do not think President Obama will like the results.

MN Gov. Pawlenty Gives Health Care Plan

Minnesota Governor Tim Pawlenty, or T-Paw as he is sometimes called, submitted his plan for healthcare reform in a Washington Post Op-Ed.  As Republicans are looking for solutions and a leader as they head into the Feb. 25th Healthcare Summit with President Obama,  I think they should listen to Governor Pawlenty.

The article highlights 5 simple ways to reform healthcare: incentivize patients to be smart consumers, pay for performance, liability reform, interstate healthcare insurance, and modernizing health insurance.  All five ways are common sense to me.  Some of the ideas have worked well in Minnesota, while other ideas (such as interstate healthcare) have yet to be implemented.

The United States is supposed to be the great American experiment in which different states have the sovereignty to try different ideas to see what works and what does not.  In Massachusetts, they tried a universal healthcare system (Commonwealth Care) and did not work well at all.  The big issue was their poor projection of costs of the program, which are already about 20% more than they anticipated in just 3.5 years after implementing the new policy.

Adversely, Pawlenty’s plan has worked well in a liberal Minnesota because the ideas make sense (increase competition, better information for consumers, etc.).  I hope the Federal Government can either learn from Minnesota and implement simple ideas or leave universal healthcare for states to decide.  Based on what happened in Massachusetts, I do not believe many states would  adopt the policy.