Thursday, September 15, 2011

You Don't Cut Medicare to Create Jobs!!!

Again, I'm scratching my head at the incomprehensible Dems and their standard bearer, Barack Obama. Here we are, according to all the news releases, in the midst of en epochal increase in national poverty (15.1% or over 47 million now in poverty, or 1 in 6) and the average male wage earner (who works full time all year) earning less than his 1978 counterpart, according to yesterday's top story on the front page of The Wall Street Journal.

And what does Obama want to do as part of his Jobs Bill? Evidently cut Medicare and Medicaid to pay for it! He has a bill totaling about $447 billion, which he plans to "pay for" mostly with payroll tax cuts and other gimmicks - none of which can work in the long run. But the worst is enabling nearly 70% of that total by cutting Medicare and Medicaid. (This in itself is effing amazing, given no one is asking the military to pay for their never-ending budget increases! No, we are all expected to just suck salt at their behest).

Making more payroll tax cuts is especially pernicious since you are in effect eating away at the economic supports for both Medicare and Social Security, since payroll taxes are what provide their revenue. Thus, as Sen. Bernie Sanders said yesterday, you are actually making future cuts much more likely. The blather that the "losses will be made up by later" budget moves, is bollocks, since everyone (especially the Tea baggers and repukes) interprets that to mean filling the emptied coffers with more IOUs - which they regard as valueless.

But the proposal of cuts to Medicare to pay for these maybe 1.9 million jobs, which will possibly put 22 million more in poverty, is the most galling. It fouls the Democratic brand, as the party that is supposed to PROTECT these benefits, while also emasculating all the true Dem candidates next year - who'll now not be able to pound the Repukes with their threat to take away benefits. How is this strategically sensible? One begins to wonder if Obama finally needs to get rid of his two advisors, David Plouffe and William Daley, admonishing him brainlessly to "tack to the center"- when the center hasn't exactly been impressed (according to polling numbers) while he loses the base he needs to win next year. Daley, as reported in the WSJ 2 days ago, reportedly even told pollers from the American Lung Association (who called to report most Americans disagreed with the administration's tabling of clean air (EPA )regs to bring ozone levels down) that he "isn't fucking interested" in their polls. Oh yeah, Daley, well maybe your boss will be over the next year as his own poll numbers dive because he keeps listening to your dumbo advice!

The White House counsels that the Medicare cuts will only be to "providers" and they seem (for now) to have backed off raising the eligibility age to 67, which in the end will make the deficits from health care even larger - because more oldsters (64-67) will have to visit ERs to get the care they need (since most private insurers won't take them with any pre-existing conditions, or for less than about $14,000/yr).

At the same time, the providers are mounting a counteroffensive to fight back, in order to "spread the pain to beneficiaries" - according to an article in yesterday's WSJ ('Health Industry Pushes Back With Its Medicare Proposals', p. B3). According to the piece, which I strongly suggest Mr. Obama and his two lead advisors read:

"Frustrated at being the target, the health industry (members of the Healthcare Leadership Council) is pushing back, arguing that some of those savings should come directly from the pockets of beneficiaries.

'This thinking that we're protecting beneficiaries because we're only cutting providers is mythical' said Mary Grelay, the Council's president. 'At some point it does affect beneficiaries' she said, because such cuts weaken health care providers' ability to offer services'"

The article then goes on to quote a number of Council luminaries, who correctly observe that the rising aging population (10,000 boomers turning 65 each day) and associated costs make the nation's safety nets "starkly different from what they have been historically".

This is spot- on true, since while formerly the benefit programs (I detest the word "entitlements" and wish Obama wouldn't use it, or the generic, marshmallow word "congress" when he ought to single out Republicans for opprobrium!) served a relatively slowly growing aging populace, they are now confronting a demographic tsunami - nearly all of whom will need those two programs to survive.

One marker of the survival registry is given by the number of Americans in poverty, another is the number of Americans currently having to serve in the capacity of unpaid caregivers for family members. According to a recent AARP Bulletin piece ('The Caregiver's Dilemma', Sept., p. 10) "the percentage of age 50-plus adult children caring for parents has TRIPLED since 1994".

The Families and Work Institute reports that 42% of all U.S. workers in the past five years have had elder care responsibilities and 49% expect to render such care in the next five years. Meanwhile, the total loss to American businesses because of their employees having to take time off to render care has been estimated at $33 billion a year. The total value of all the care delivered is estimated at $450 b a year or HALF of what the Pentagon pisses away on useless occupations and toys each year.

Clearly, there is no further burden that can justifiably be placed on these families, by any moral barometer. To even remotely threaten higher Medicare premium rates to the same 50-plus people is adding massive insult to injury. To threaten to raise their eligibility age to 67 before they can receive Medicare, is beyond the pale, politically suicidal and outrageous! This is not only adding horrendous economic burdens but making their caring for elderly parents vastly more difficult- as it pushes both caregivers and cared-for into poverty. To threaten to put Medicaid assistance into a "state exchange" while allowing military spending to metastasize like a cancer, is to confirm Martin Luther King's verdict: "A nation that continues year after year to spend more money on military defense than on programs of social uplift is approaching spiritual death."

The solution to all these problems, fortunately, is relatively simple! Former Federal Reserve Chairman Alan Greenspan told congress on Tuesday that it is imperative they close tax loopholes, and rescind ALL the Bush tax cuts, and whatever they do...NOT lower tax rates! He added, reinforcing the Health Leadership Council's take that "Medicare and Medicaid are growing faster than the government's ability to pay for them".

This is even despite the onerous increases in Medicare premiums since 2001, and the inability of Social Security payments and cost of living adjustments to keep pace. According to Smart Money magazine (Oct., p. 55), Medicare premiums have increased 122% over the past ten years while Social Security payments have increased only 33%. This means a personal budget deficit of 122% - 33% = 89%, that must come out of beneficiaries' pockets! That is, out of every $1.22 of Medicare medical costs, the beneficiary is having to cough up 89 cents.This is a process whereby our seniors are gradually being sent into penury and is unacceptable. Thus, no more Medicare premium increases can be tolerated.

Neither can cuts in Medicare payments to providers! (Since this will simply lower the standard of care, or in the case of first providers- such as primary care physicians - they will simply stop taking new Medicare patients. One then has a hollow benefit).

What is the answer? It's simple as Alan Greenspan's recommendation: LET ALL Bush Tax cuts expire! As I already showed in a previous blog they are useless anyway:

They have no more to do with improving or enhancing the jobs picture than the Man in the Moon and merely add to our deficits, like the outrageous, unpaid for military spending.

Simply by allowing all Bush tax cuts to expire, a fully passive operation requiring no legislative action in December, saves $4 trillion over 10 years in added deficits. If he had the gumption, necessary rhetoric and moxie, Obama could even make the case that his Jobs Bill will be paid for out of that rescission. (As opposed to constantly yapping "Pass this Bill!") Admittedly, this is more difficult in the current austerity- deficit hawk environment than simply parroting "spending cut" mantras, but it's the honorable and decent thing to do.

And most of us believed - some still believe - Obama is a decent and honorable man. If so, he needs to show it and not even remotely suggest putting Medicare (or the even more badly needed Medicaid) on the cutting table to pay for his Jobs proposal. This is not a message to send to those already over-burdened by debts and family care in this forthcoming election year.

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