Author: mike

OpenSecrets is a great site.  Find out for yourself where the money is flowing in politics.

Interesting was reading about Scott Brown (highly publicized Senate race in Mass) and also where healthcare companies donate their money.  You might be surprised to know that it’s mostly going to Democrats right now, but I suspect that is due to their large majority population in congress.

For tech fans, reading about Microsoft’s PAC is also interesting.

Of course, if we really want to control our own government, we need to nix all political PACs and lobbyists.  Then OpenSecrets wouldn’t be such an interesting site.

Electric cars are coming.  Right now, the electrics that you’d want to drive cost too much.  But those prices will come down.  Are we ready to switch from gasoline to electric?

To answer the question, let’s look how States generate their electricity.  The Energy Information Administration has a nice summary table.

On average, ~50% of America’s electricity is generated from coal.  California’s largest source of electric power is natural gas, and generates only ~1.5% of its power from coal.  But, if you buy your electric car in Indiana, you’ll be trading your gasoline for electric power which is more than 90% generated from coal.

Now, I’m just doing fuzzy math, making simple assumptions based on some published statistics.  My numbers could be wrong (perhaps electric cars are charged at night, and the profile of energy sources at night is different than what is consumed today).  Maybe someone smart can correct me on that.

But on the surface, it doesn’t seem to me that switching from gas to electric will make our skies cleaner.  Why do many states and governments offer rebates to switch?

Others have noticed this problem too. 

Obama likes to say that his plan does not kill private insurance.  He likes to say that he is “adding choice”.  This is patently false, and you should be scared.  If the Obama plan passes (currently in debate in the House!), you will eventually have no choices except the government choice.

The House plan allows employers to chose:  either they can provide private insurance and pay nothing to the government plan, or they can simply pay 8% of payroll to the government and everyone gets the government plan.

Today, employers are already paying more than 8% of payroll for healthcare premiums.  In fact, small businesses are paying between 11% and 14% of payroll to health insurance premiums.  With medical costs rising, this figure is only going up.

So even if your employer doesn’t switch to the government plan now, they eventually will.  A reduction in wages by 6% can be achieved by switching your healthcare provider?  What board of directors *wouldn’t* switch?

Now you might, like Obama, believe that the health care insurers are making too much in profits, so the private insurers just need to reduce prices.   I’m sure they will try to compete with the new taxpayer-funded pricing.  Keep in mind, however, that while a cut from 14% of payroll to 8% of payroll is only a 6% savings for the company, that represents a 43% drop in revenues for the health insurer.  These companies will need to cut costs to reflect the new pricing; which roughly translates to a 43% drop in covered care.  Because of the reduced coverage, this will give employers all the more reason to switch the the simple, no-overhead plan – the government plan.  As more employers switch, more private insurers will go out of business.   It is just a matter of time.

Oh – and how did the government calculate the figure for an 8% payroll tax?  Nobody knows!  Should it be 9%?  7%?  Nobody knows!  It appears to be a number masterminded to drive Health Insurers out of business.

Obama is about taking away freedom and taking away choice.  Government healthcare does improve healthcare for 10% of Americans, but it makes healthcare worse for 90% of Americans.

We’re in a recession, and unemployment is high.  Some level of government stimulus is a good idea.  But how do we determine which programs are good? Is “Cash for Clunkers” a good idea?

I evaluate spending proposals by considering what long term value is being built.  The government can inject cash into the economy, but after the short term injection, will value remain in the economy which can benefit us for the long term?  Or is it just a short term spend?

Cars for Clunkers is a short term fix.  It adds cash to the economy for a short period, and allows Americans to continue consuming more goods than we probably need.   What happens to cars?  They get consumed – they get driven, used, and eventually (5-10 years later) get scrapped.  So when the government signs up to spend $5B on cars, they’ve injected a temporary cash boost to the auto-industry, and helped consumers get some “stuff”.  But in the end, Americans receive no long term value from this cash injection.  And when the government stops spending, the auto makers will need to layoff the workers they hired to accommodate the short term needs of the boost.

A better use of money is to build things of value.  If the government wants to create jobs, it should invest in building things.  Building schools, improving roads, and building national or local infrastructure builds long term value.  Unlike the car which will wear out in a few years and provide no value, building a school lasts for decades.  Not only do the citizens building and running the school benefit now, but the school is still usable by our children and grandchildren in the long term.

Tell your congressmen to vote no on any short-term cash injections.  All spending should build value.  If your senator can’t show long term value in their spending, it is not worth it.

The bleeding hearts will give you statistics like, “22,000 adults died in 2006 because they did not have health insurance” as a reason to support the Obama Health Care Plan.  While that is sad, Obama’s plan DOES NOTHING to solve this particular problem.

Let’s break it down.

America has about 3.5M homeless.  1.4M of those are children.  That means 2.1M adult homeless people.  How many of these people have medical insurance?  None.

For the adult homeless, let’s assume a fixed distribution between 19 and 75, and lets assume they have a typical life expectancy (although they probably live less).  That means that at least 38,596 of them will die this year.  Will many of them die because they didn’t have health insurance?  Of course!  But unless Obama’s magic health care plan can also solve homelessness, these statistics aren’t going to change one bit.  So the whole claim that this is a problem with our insurance program is bunk.

Make your own conclusions about Obama’s health care plan.  But when you hear these ludicrous arguments about “number of uninsured Americans”, “number of Americans to die without insurance”, “high cost of insurance” – remember these statistics are very complicated and never accurately summarized in a pithy headline.