Bill's Death to Private Student Loans Will Result in Job Losses

The final vote-getting link in the sausage-making of the health care bill was its $61 billion in health care "savings" which shifted all lending from the lender-based Federal Family Education Loan Program to the government's Direct Loan Program. The language made it into the bill despite private lender's best efforts to stop them from ending their ability to make loans, which they argued would kill thousands of jobs. The federal student-loan takeover of the remaining 14% of private industry loans is both another reason to hate this bill and an example of our government's overstep to the detriment of competition and private industry. To be fair, the abolishment of the private student loan industry started with the creation of the “Stafford Loan” program in 1965 to allow students to borrow money cheaply with a government guarantee. Subsequently, the government saw fit to transfer loans made by private lenders to the government’s books with a subsidy, which allowed sketchy, but more favorable book-keeping. Clinton then started the direct loan program where the government would directly make its own loans to students, supposedly increasing competition. With a glance back at history, it's easy to see how lenders were slowly elbowed out by government loan programs in this industry. As I said, only 14% remain and with this bill, Obama and Congress will have eliminated the last profit-makers from the business to "save" money - money which he has already spent on health care at the expense of many thousand jobs, according to private banking institutions. (See http://www.journalstar.com/business/local/article_e1492e4a-391f-11df-a246-001cc4c03286.html)

HillaryCare is to ObamaCare

A slightly older, but young-at-heart, friend of mine emailed me today and told me that in his mind, the primary reason for the Republican congressional electoral victories in 1994 was due to a backlash against HillaryCare, the single payer health care overhaul proposed by the Clintons earlier that year. He explained that the very proposal of socialized medicine caused the pendulum to swing back in favor of the GOP. However, some say it was the opposite - that the Clinton's ineffeciveness in bringing about major health care change caused Clinton Congress. Not surprisingly, the same arguments are occurring with the passage of ObamaCare, except, since it passed, the Republicans say that the ram-through will lead to GOP landslides while the Democrats argue that its passsage will buffer them against any electoral correction as people will see the goodness behind the law by election time. Upon the passage of ObamaCare, I said, and still believe, that the Republicans will take both houses, midterm trend aside. I believe Americans will no longer have to endure the Pelosi bob or the Reid-isms primarily because people are angry. And, everyone knows - anger, even more than sandwiches and free rides to the polls - motivates voters to turn out and toss out those to which their anger is directed. And, as I pointed out yesterday, voter anger and disapproval with Congress is at 72%. That number has not been as high since October of 1994. What has changed since the 2008 elections and now? Yes, the economy isn't great, but unemployment has remained relatively flat and has even declined a tad in the past two months. Yes, the $787 billion stimulus seems to have been a bust by all accounts, save the insanely-named bureaucratic body that counts the jobs they "created," but public anger didn't swell upon it's passage. Perhaps the partisan passage of this bill began to roll the ball of public opinion down the hill, but it wasn't until the health care debate came front and center and STAYED front and center, that "weak" candidates and campaigns caused Democratic losses in New Jersey, Virginia and Massachusetts. You will never get a Democrat to admit that the health care proposal caused these losses, just as they'll spin defeats in 40 seats in the House and 11 seats in the Senate come November, but deep down, they'll know. It'll be so much fun listening to them try to explain why all the speeches in the world couldn't convince the American people that self-interested congressmen know what's better for them than they do.

Poll Shows Voter Disapproval of Congress Hasn't Been This High Since '94

A new Washington Post/ABC News poll has voter disapproval of Congress at 72%, a figure which hasn't been reached since the week before the 1994 election. It's hard for me to remember what had people so upset in '94, as I was in high school, but it's painfully obvious at this juncture - the shoving through of the original pork-filled health care legislation that voters repeatedly begged Congress to scrap. If history repeats itself and those numbers remain high, Republicans are likely in for a hell of an election in November. And actually, many are in for a neat preview of November over Easter recess as their angry constituents pay them visits. Of course, they'll only claim that those voicing their concerns are racist, low-income-family-hating, Swastika-tatooed, gun-wielding, Neanderthals that are insecure about the fact that the non-Hispanic Caucasion population is declining because just like in '64, dissent with this legislation is about racism, not disapproval with pork-belly politics, higher deficits and worsened health care. http://www.nytimes.com/2010/03/28/opinion/28rich.html Except, hmmmmmmmmm, the poll seems to suggest otherwise, and the media understands this, which is why they are doing everything in their power to discredit Americans that disapprove of the new law.

The Potential VAT Tax and the Real "Voodoo Economics" of the Heath Care Bill

Krauthammer predicted a national sales tax earlier this week but has now provided a more concrete case explaining the specific economic pitfalls of the health care bill and why a value added tax will be necessary to plug the hole. As he put it, "Obamacare, when stripped of its budgetary gimmicks — the unfunded $200 billion­–plus doctor fix, the double-counting of Medicare cuts, the ten-six sleight-of-hand (counting ten years of revenue and only six years of outflows) — is, at minimum, a $2trillion new entitlement." So, which funds will be expended to expand Medicaid by adding 15 million new dependents as the debt grows exponentially, our bond ratings become more threatened and hyperinflation looms? Well, as Obama has intimated, his deficit-reduction commission will tell us AFTER the elections. And what will they tell us? If you're Krauthammer, you believe a 1% consumption tax is coming as "every 1 percent of VAT would yield up to $1 trillion a decade." According to Krauthammer, levying all the taxes in the world on the "rich," which is now defined as anyone making $200,000, is not nearly enough to cover the largest and most expensive entitlement in history. And as he points out, the VAT will only grow once instituted, just as was the case in Europe. ("Germany: 19 percent. France and Italy: 20 percent. Most of Scandinavia: 25 percent.") And, I'm betting he's right about this because it makes sense that "as we approach European levels of entitlements, we will need European levels of taxation."

Obama Already Lowering Expectations

Since he began the health care crusade, Obama has been reiterating that once the ink dries, Americans will start to see their premiums and pharmaceutical costs drop. In his radio address this week he was much less specific, saying, "But what every American should know is that once I sign health insurance reform into law, there are dozens of protections and benefits that will take effect this year." In his speech today in Iowa, Obama once again, famously, shifted his rhetoric to reflect the actual contents of the bill. In other words, he scaled WAY back on promises to bring immediate change:

Now, it will take about four years to implement this entire plan – because we need to do it responsibly and we need to get it right. That means that health care costs won’t go down overnight. But we have built into the law all sorts of measures to assure that in years to come, health care inflation, which has been rising about three times as fast as people’s wages, will start slowing. We’ll start reducing the waste in the system, from unnecessary tests to unwarranted insurance subsidies. So over time, Americans will save money.

Is anyone surprised? He, even more than most politicians, has a knack for the "What? I've said that all along." So, what is the real truth? None of the major provisions providing coverage take place until 2014 except the provisions barring insurers from denying children with preexisting conditions coverage and the provision closing the "doughnut hole" on Medicare prescriptions (whatever the hell that means).

Value Added Tax to Finance Health Care?

As everyone has been saying, the health care bill was "financed" on assumptions of potential votes and false projections, so how will they recoup the money to pay for this gigantic entitlement? Krauthammer thinks they will impose a value added tax to every purchase we make. Listen: http://www.youtube.com/watch?v=SHiEyPk78EU

Stupak's Price

"Three airports in the district of infamous fence-sitting and ultimately kowtowing Democrat Bart Stupak were awarded $726,409 in grants by the Obama Administration just two days before a vote on Obama and Pelosi’s government takeover of health care." All the backroom deals will now be brought to light. If anyone talks to me about Obama's "integrity" from here forward, I'll just have to assume they're blind idiots.

Constitutional Challenges to Health Care Unlikely to Prevail

Constitutional scholars are already debating whether the individual state suits being filed by conservative attorney generals (Virginia's was the first to announce - http://www.reuters.com/article/idUSN2219276420100322) will successfully prove the health care bill's mandate that all Americans buy insurance unconstitutional. I believe, like Professor Esenberg, that it's unlikely. The decision will in fact eventually find its way to the Supremes, but given their distaste for second-guessing Congress, and the fact that Anthony Kennedy will be the deciding vote, it seems like more of a gamble than repeal. And, like Professor Esenberg, I believe it will be the final blow to our liberties and the check the courts once had on the legislature. As he put it, "It will be tragic because the notion of a Congress limited by the scope of its enumerated powers will have finally suffered the coup de grace. The Bill of Rights (once famously - and now ironically - thought to be unnecessary given the structural limits on the power of the national government) will become the only limitation on the power of Congress. If Congress can require you to buy health insurance because of the ways in which your uncovered existence effects interstate commerce or because it can tax you in an effort to force you to do any old thing it wants you to, it is hard to see what - save some other constitutional restriction - it cannot require you to do - or prohibit you from doing." This becomes particularly scary when the Congressmen voting to take your liberties away, aren't even able to decipher from which part of the Constitution they draw this apparent authority. (See http://www.youtube.com/watch?v=f0VYOa2BRbg). Congressman Conyers believes there is a "good and welfare clause" in the Constitution. Ummm, you mean, "general welfare" clause? The clause liberals use to justify stamping on the Constitution and redesigning the framer's structures of power? As Esenberg stated, if Congress is only limited by the Bill of Rights (thank God that was drafted) then what can't they do but take your life or property unjustly after taxing it to death? The framers intended for Congress to have specifically enumerated powers and by the passage of this bill, Congress has once again ignored those limitations.

A Glimmer of Hope for Repeal?

I know it's a long shot, but what about a Republican takeover of the House and, ahem, Senate in November and a supermajority in the Senate along with a Republican President in 2012? Rich Lowry gives us some reasons for optimism. Most importantly, that the benefits do not kick in until 2014.

Doomsday Arrives

So, in the end, Stupak folded and now we have another gigantic entitlement that we cannot afford. And for what? An executive order that mimmicked the language in the bill that he originally opposed. And more importantly, an executive order that will do nothing to affect the legislation as Stupak understands, as does anyone who has a cursory understanding of the checks and balances system. (http://blogs.wsj.com/washwire/2010/03/21/gop-abortion-deal-wont-trump-the-law/) So, thanks to spineless Stupak and his stooges, we are left with a bill that will result in much higher taxes, slower economic growth and worse medical care. How will this affect you? If the reconciliation bill is passed, within the next six months, if you make over $200,000, you will pay another 3.8% in Medicare taxes. You will also enjoy an increase from 35% to 39.6% in your income tax rate. Raising taxes in a recession will slow or prevent recovery, but the Hill doesn't care. The bill also creates a 3.8% tax on interest and dividend income above certain levels beginning in 2013. However, those are the provisions in the reconciliation bill, which has not passed yet. The original Senate bill does not contain this almost 10% tax increase on productive working individuals. Instead, it contains middle-class insurance subsidies that are less costly and does not contain the new 3.8% payroll tax. So, what happens if the reconciliation bill goes down as it is destined to do since the GOP can stick amendments in it to cause certain defeat? We're stuck with the original bill, which was passed yesterday. What does that mean? "Big Labor and its Democratic clients would be forced to swallow a larger excise tax on high-cost insurance plans, and it would also forestall the private student-loan takeover that Democrats included as a sweetener. In other words, they'd be forced to eat the sausage they themselves made as they have abused Congressional procedure to push ObamaCare into law." This is a near certainty, as even though the Democrats can pass the reconcilation bill with only 50 votes in the Senate, once poison pill amendments enter in, some will be forced to vote against the bill. Regardless of the outcome of the reconciliation bill, this is a truly sad and scary day in America. The voters understand that our government is spending us into unsustainable levels of debt and taking over every area of business and our lives. I wish they'd known this was exactly what Obama intended when they voted for him in 2008. The only consolation, however small, will be November, when the GOP takes back the House and Senate. Of course, they won't be able to repeal this monstrosity until 2014 before the benefits kick in, when they have a senate supermajority and a Republican president. I know it's a long shot, but it's all I've got.

Spineless Stupakers?

Sources say the Stupak 12 are still in negotiations with Pelosi to place language restricting the use of federal funding for abortions into the "deem and pass" lesgislation. The Stupakers said they want a "committment to act letter" as any deal involving future legislation would require them to trust that the House and Senate would both act to ban abortion funding. Of course, even with this letter, these legislators understand that the Senate will not act even if they all say they will. So in effect, they are going through the motions to cover their - pardon my French - asses. If they agree to this, I hope all 12 are held accountable in November as the individual polls in their more conservative districts all indicate their constituents are opposed to this bill. (See http://www.politico.com/news/stories/0310/34680.html)

Another Massachusetts Guy Threatens Obamacare

Stephen Lynch, one of Pelosi's floor whips, said he would not support a proposed “deem and pass” procedure allowing Democrats to vote to strip out controversial portions of the Senate bill and then “deem” that the entire package had passed without a second, direct vote. Lynch said it was “disingenuous” and was outspoken about one of the unfair Senate provision involving the taxing of Cadillac health care plans. Lynch said, “It would really call into question the credibility of the House.” One has to presume that Lynch is more opposed to the bill and skeptical of reconciliation than the deem and pass strategy as both sides have used that in the past. But whatever the reason, since deem and pass is the only way they can potentially get the necessary votes, I welcome another "no" vote, as it only keeps us further away from the passage of this abominable bill.

Obama and Pelosi: Pulling Out All the Stops

I knew they could peel off some votes with bribery, as they did with two house members from California today (see link to increased water allocation to their regions). But I still hope there will be enough Democratic house members that will stand their groud to vote "no" to the health care bill, knowing that they will be stuck with the Senate's version as reconciliation will prove fruitless. I am less optimistic than I was yesterday, but I still believe that enough members will see this legislation as their ticket to political banishment. However, I am aware as I write this, that Obama is threatening to pull their campaign money and Pelosi is vowing to shut them out of leadership roles in the party if they defy her. We'll have to watch it unfold.

NY Times CEO Pay

New York Times Co. CEO Janet Robinson got roughly $4.9 million in compensation in 2009 as her company's revenue continues to plunge. Robinson's base salary fell 4 percent to $962,500, but her bonus of about $2.3 million, quadrupled from her 2008 bonus. Robinson also received stock options that were worth $1.6 million.

House Health Care Count

37 House members say they will not vote for the Senate's health care bill, seven are in the "yes" column and 70 are "undecided." Hmmm, I wonder if this has anything to do with the wavering: http://thehill.com/blogs/ballot-box/house-races/86761-four-months-after-last-health-vote-many-dems-in-tougher-reelection-races Apparently, 2010 elections are polling much more tightly now than they were when the House first voted on health care. This, and this, alone, will sink the health care ship. I've always believed in the overpowering principle of self interest despite Pelosi and Gibb's constant spin.

Pelosi Shuns Stupak and Pro-Life Position

Pelosi gave up on Bart Stupak, but not his colleagues who vowed to vote against the health care bill if it involved federal funding for abortion. And apparently, it's working. Stupak said she's "peel[ed] off one or two" of the twelve. Stupak claims that even if they can't garner the votes elsewhere, they won't insert the abortion language that the group has based its votes on. Which tactics is Pelosi employing? Stupak said both the White House and Pelosi are "twisting arms" and the members are also receiving pressure from their Democratic supporters, "like unions" to pass the Senate bill. Stupak said the deliberations with party leadership, "are a pretty sad commentary on the state of the Democratic party" as they have argued that abortions are more cost effective than caring for unwanted babies. He added, "This has really reached an unhealthy stage. People are threatening ethics complaints on me. On the left, they’re really stepping it up. Every day, from Rachel Maddow to the Daily Kos, it keeps coming. Does it bother me? Sure. Does it change my position? No." Let's hope most of the other 12 have the integrity and strength to withstand the thuggish arm twisting. I feel confident they will. I believe this will be the decisive issue for the bill and the party.

Plans Slaughtered

The Senate Parliamentarian has ruled that President Obama must sign Congress’ original health care reform bill before the Senate can act on a companion reconciliation package. This precludes Slaughter's nutty rule change idea (see yesterday's post) as well as any meaningful reconcilation that would bring the Stupak 12 on board. Of course, now, Democrats are claiming they will go forward without the Stupak group. They are saying they will "call Stupak's bluff." How, exactly is that? They need those votes. Period. Stupak and company have been firm in their stance. This is not going to happen. They simply do not have the votes. http://news.yahoo.com/s/ap/20100311/ap_on_bi_ge/us_health_care_overhaul

First Reconciliation, Now This?

The Democrats have gone completely insane over health care. Because the Stupak 12 are holding firm on their promise not to vote for the Senate bill's abortion language, Louise Slaughter, the House Rules Chairwoman, is drafting a rules bill that would allow health care to pass through the House without a vote. Apparently, she wants to pass a bill that would consider the Senate bill passed once the House approves a corrections bill making changes to the Senate version. This is nuts and will not happen, but the fact thar they're proposing it means they are growing desperate as Stupak and company hold their ground.

Wiggly Wobbly House Voters

They took a poll on the hill today, and I did not care for what I read. As of today, there are 11 firm "no" votes for the Senate's health care bill, one "leaning no," and 17 that are undecided. The undecideds incompass the 12 Stupakers that have, of late, stated that Pelosi may be able to craft language assuaging their fears about publicly funded abortions. This makes me, the eternal optimist, a bit nervous, although, I still see only a 30% chance of passage. I will admit, though, that Lowry's article on the potential for health care repeal, made me feel a touch better. (http://article.nationalreview.com/427314/the-case-for-repeal/rich-lowry?page=1)

Massa Bullied and Shoved Out Over Health Care?

As noted on Friday, House Democratic member Eric Massa was under investigation for allegedly making an inappropriate comment to a male staffer until he announced his resignation. However, today he claims that the comment made at a staffer's wedding reception on New Years Eve was nothing more than a politically incorrect drunken gaffe and that the real reason he is under investigation is because Obama's Chief of Staff, Rahm Emanuel, ordered the investigation to oust him because he wouldn't vote to pass the President's health care bill. Massa explained in a radio interview that Rahm, completely naked, approached him in the shower at the congressional gym, pointed his finger at his chest and told him that he'd better vote for the President's budget. Massa claimed he used these tactics often to intimidate members into voting for the president's agenda. (See this link to hear the radio interview describing the confrontation: http://www.realclearpolitics.com/video/2010/03/08/massa_rahm_emanuel_would_sell_his_own_mother_for_votes.html). Massa explained that because he was a "no" vote on health care, Emanuel pushed him out by using his inappropriate comment to launch an investigation to end his career and get the President that much closer to health care passage. This accusation, whether true or false, will slow an already impossibly slow bill voting process, but may in fact, lead the President to take action if general denials don't serve to make this issue disappear. I don't think Obama will fire his Chicago-style arm twister, but someone will take the fall if there is too much made of this alleged blackmail, especially if it poses a threat to his obsession, health care reform.

More Bad news for Pelosi: Massa Accused of Harassment, Will Resign Monday

New York Democratic Rep. Eric Massa said today that he would resign from Congress on Monday. His statement came after the revelation that he was under investigation by the House ethics committee for sexually harassing a male staffer by using words that he admitted "might make a Chief Petty Officer feel uncomfortable." Although he owned up to it, he immediately opined that "with the destruction of our elected leaders having become a blood sport, especially in talk radio and on the internet," his family would be "torn apart" by an ethics investigation. Massa’s resignation is a second blow to Speaker Pelosi after Rangel stepped down from his powerful committee chair earlier this week. Moreover, two other House Democrats from Pelosi's state, Reps. Maxine Waters and Laura Richardson, remain under investigation and could also be forced out of office. Massa may leave Pelosi that much farther from her goal of passing the Senate's health care bil this month.

A New Wave of Bribes for Health Care Votes

Wow. I guess health care obsessed Obama is pulling out all of the stops to coerce the passing of the Senate's bill in the House so he can trudge forward to reconciliation. Obama is hosting ten Democratic holdouts from the November health care bill vote tonight at the White House in an attempt to get them to switch sides. Jim Matheson of Utah is one of them. Conveniently, Matheson's brother Scott M. Matheson, Jr. has just been nominated to the United States Court of Appeals for the Tenth Circuit by Obama. They will say this has been in the works for years, but the voters aren't that stupid. This continued Cornhusker-style bribes will only serve to further outrage the public and cause such distaste for the Dems, that they will lose every election in November. This will be especially true if he succeeds in bribing enough congressmen into forcing this bill through reconciliation.

Rangel "Temporarily" Retires His Gavel

Rangel finally asked for a leave of absence from his chairmanship of the House Ways & Means Committee until the ethics committee completes its investigation into his alleged improprieties involving the use of his official position to raise money for a New York college center in his name, his belated disclosure of at least hundreds of thousands of dollars in assets, his use of rent-controlled apartments in New York and espeically, his violation of gift rules in connection with a series of trips he took to the Caribbean. Specifically, the panel found that he "violated standards of conduct by accepting 2007 and 2008 trips to Caribbean conferences that were financed by corporations." Conveniently, it said it could not prove whether Rangel knew of the corporate sponsorship, but that members of his staff knew about them and he was responsible for that. Rangel claimed he was clueless regarding the corporate sponsorship and begged not to be held responsible for something his staff members "may have known." Hmmm, remember the golf trip certain Republican members took with Jack Abramoff? It seems Pelosi's promise to drain the swamp of ethics problems after Republican's "culture of corruption" will swallow up a few of her own.

What's Really Behind the Bunning Block?

Kentucky Senator James Bunning has drawn quite a bit of criticism this week by blocking a $10 billion spending bill that requires unanimous consent to advance expeditiously, that would, among other things, fund the extension of unemployment benefits. According to the media, he is a curmudgeonly, calous, old man that is standing on ceremony without purpose, to punish the unemployed and cause gridlock, true to Republican form. The truth? Bunning is attempting to shed light on the downfalls of increasing the deficit as well as the hypocrisy of the Congressional attempt to avoid PAY-GO, a bill passed by Congress to ensure that legislation does not pass unless there is a corresponding method of payment for the expenditures contained in the bill. Democrats are calling for the extension as an emergency measure, which technically allows them to circumvent PAY-GO. "If we can't find $10 billion to pay for something we all support, we will never pay for anything on the floor of this U.S. Senate," Mr. Bunning said. Bunning wants to pay for the bill by dipping into unused stimulus funds, which the Democrats have refused to do. While I wholheartedly agree with Bunning's principles, I can't espouse his methods as the expiration of unemployment benefits Monday caused 100,000 people to lose their benefits and 400,000 more will lose them within one to two weeks, which would also cause them to lose their health benefits. However, I welcome some other implications of the gridlock such as the lack of funding to the Highway Trust Fund, whose expiration caused the Department of Transportation to furlough nearly 2,000 employees without pay. http://online.wsj.com/article/SB10001424052748704358004575095970707513064.html?mod=WSJ_hpp_MIDDLENexttoWhatsNewsForth http://www.nytimes.com/2010/03/03/us/politics/03cong.html

2009: Government Handouts Higher than Tax Intake

Without welfare, unemployment and tax cuts last year, the income of Americans would have plunged to $723 billion. As it was, with the government cushioning the blow, it dropped to $167 billion. The handouts in 2009 meant that for the first time since the Great Depression, Americans took more aid from the government than they paid in taxes. "Governmental support was critical in keeping the economy, particularly consumer spending, from completely collapsing during the crisis," said Harm Bandholz, an economist at Unicredit Markets. Like other analysts, he believes that the bulk of the small economic rebound we experienced last year was a result of government spending rather than real growth. Since the goverment had to borrow to prop up the economy, it is only a matter of time before the well runs dry and we inevitably experience the second shoe drop, which many say should have occurred from the outset of the crisis.