Monday, September 03, 2012

Time Magazine Cover Story: Deja Vu All Over Again

If America's economic landscape seems suddenly alien and hostile to many citizens, there is good reason: they have never seen anything like it. Nothing in memory has prepared consumers for such turbulent, epochal change, the sort of upheaval that happens once in 50 years. Even the economists do not have a name for the present condition, though one has described it as "suspended animation" and "never-never land."

The outward sign of the change is an economy that stubbornly refuses to recover from the recession. The current slump already ranks as the longest period of sustained weakness since the Great Depression. That was the last time the economy staggered under as many "structural" burdens, as opposed to the familiar "cyclical" problems that create temporary recessions once or twice a decade. The structural faults represent once-in-a-lifetime dislocations that will take years to work out.

Among them: the job drought, the debt hangover, the banking crisis, the real estate depression, the health-care cost explosion and the runaway federal deficit. "This is a sick economy that won't respond to traditional remedies," said Norman Robertson, chief economist at Pittsburgh's Mellon Financial. "There's going to be a lot of trauma before it's over."
~Time Magazine cover story "The Long Haul" (click to see the date of the article, text above was modified slightly from the original).

174 Comments:

At 9/03/2012 10:44 PM, Blogger Eric H said...

"...the sort of upheaval that happens once in 50 years."

Whaddaya mean pessimism? Why, with that outlook we should have been good to 2042.

Is it reasonable to call a tripling of our debt via printing in only 15 years a 'dip'? Is this the trauma or the non-traditional remedy?

 
At 9/04/2012 2:02 AM, Blogger PeakTrader said...

Obama has one foot on the accelerator and the other foot on the brake.

Nothing has changed, except we're running out of gas.

 
At 9/04/2012 2:15 AM, Blogger PeakTrader said...

Obama's solution is stepping-on the accelerator.

However, the real solution is stepping-off the brake.

 
At 9/04/2012 3:38 AM, Blogger Benjamin said...

So why are right-wing economists saying this time unemployment is structural and there is nothing we can do about it---and that more aggregate demand will only result in inflation? That is the most naysayer, negative, loser-talk I can imagine.

The problem now is a dithering, feeble Fed, directionless. It seems intent on fighting inflationary ghosts, while the USA becomes Japan.

Print more money, print more money, print a lot more money.

 
At 9/04/2012 5:49 AM, Blogger Ed R said...

Actually some economists do have a name for our current condition. The name is "liquidity trap".

The Fed is up against the zero interest rate lower bound and there is still not enough new investment in the economy to get back to full employment. The LM and IS curves cross below a zero interest rate.

 
At 9/04/2012 6:31 AM, Blogger VangelV said...

The "pathology of pessimism" lives on.

Nonsense. Things are as they are. Acknowledgement is not pessimism. It is reality.

I would argue for the opposite. Over the past decade people like you have been saying that things were great even as they ignored the bubbles being blown by the Fed and the slow decline of the middle class as it was buried in debt and crushed by taxes. The GDP deflator was underestimated so that the government could report artificially higher growth rates. And as good jobs were lost and more and more people had to settle for part time and lower paid work the methodology was changed to ignore the trend. Now we have a situation in which a huge number of homeowners owe more on their homes than they are worth. Their dreams of a comfortable retirement have been shattered and they are finding their adult children moving back in as their overpriced university education is insufficient to get them a good job. Their savings are being eroded as they attract little in the way of interest but prices for essentials are going up along with their taxes.

Sorry Mark but the problem is not the view of pessimists but the optimists. From where I stand the pessimists are far better at seeing reality than you are.

 
At 9/04/2012 6:34 AM, Blogger Methinks said...

What do both this period of time and the great depression have in common? A menace in the White House. It's difficult to be optimistic about the United States when one spends a colossal amount of time trying to outrun the stomping boot of government regulation.

There's no fantasy liquidity trap. The trap is government.

 
At 9/04/2012 6:35 AM, Blogger VangelV said...

Obama has one foot on the accelerator and the other foot on the brake.

Nothing has changed, except we're running out of gas.


Obama is a fool but he is not much worse than Bush. This process has been going on for decades and no one man can be said to be responsible. The problem is with a corrupt system where the Fed can destroy the currency by enabling the government to implement programs that it does not have to pay for with taxes and a compliant media and academia that gets rewarded for being silent about that corruption.

 
At 9/04/2012 6:58 AM, Blogger Bart Hall (Kansas, USA) said...

This is clearly a balance sheet event, rather than an inventory event, and such things come to be called depressions because the shake-out continues until the bad debt is washed out of the system.

As the private sector, including consumers, continues to de-leverage we should expect reduced expenditures on most discretionary items. This will depress hiring and wages, adding uncertainty to the mix.

I suspect we have entered a Nash equilibrium of sorts, which though it may shift upward in response to abundant energy and reduced regulation ... it likely to continue for some time.

As my grandfather (1885-1977) used to say "Every debt is eventually repaid, either by the borrower *or* the lender."

 
At 9/04/2012 7:01 AM, Blogger Larry G said...

re: " the stomping boot of government regulation."

re: " the Fed can destroy the currency "

are these issues only with the US or are these things that are present in most every government?

If someone were going to differentiate between all govts and the specific things the US govt is doing differently -and much worse - what would they be?

It's hard in CD sometimes to figure out if folks are opposed to the way that the US operates - or they are opposed to all central govts in the world.

 
At 9/04/2012 7:50 AM, Blogger Jon Murphy said...

To be fair, there are a number of structural issues that we have to deal with:

-Manufacturing is becoming even more capital intensive.

-The energy industry is becoming more prominent, but the workers just aren't there yet.

-Tech companies are moving to the forefront.

-Dodd-Frank and the Affordable Care Act (whether you like these things or not, you have to realize they have a major impact on the structure of their respective industries and much remains in question about these acts).

These changes have made hiring difficult (manufacturers and construction workers don't have the same skills as oil drillers). That is why, despite the fact that firms are adding jobs at the same pace as the past three expansions, some people have been out of work for a long time or dropped out of the workforce entirely.

There are a number of structural changes facing the US economy right now. But the record of history is crystal clear: the US economy has gone through structural changes before and come out stronger. There is no reason to think otherwise here. To throw up one's hands in defeat and say "this is the end!" is just foolish and ignores millenia of human history.

 
At 9/04/2012 7:52 AM, Blogger Jon Murphy said...

I mean, to be perfectly honest, you really need to cherry-pick (for blatantly misinterpret as Zero Hedge likes to do) to find reasons to be perpetually pessimistic here.

 
At 9/04/2012 8:05 AM, Blogger VangelV said...

As the private sector, including consumers, continues to de-leverage we should expect reduced expenditures on most discretionary items. This will depress hiring and wages, adding uncertainty to the mix.

The private sector has been deleveraging. The problem is the government has continued to borrow and spend and by doing so has distorted the economy and prevented liquidation.

 
At 9/04/2012 8:08 AM, Blogger VangelV said...

I mean, to be perfectly honest, you really need to cherry-pick (for blatantly misinterpret as Zero Hedge likes to do) to find reasons to be perpetually pessimistic here.

While some on Zero Hedge clearly have an interest in spreading the message of doom I would say that many of the commentators on Zero Hedge have been closer to the mark than Mark and the optimists.

 
At 9/04/2012 8:10 AM, Blogger Larry G said...

re: " Dodd-Frank and the Affordable Care Act"

agree. fair is fair.

It's very hard to really quantify Dodd-Frank as compared other prior regulations.

It seems like an easy thing to blame but a hard thing to really show impacts - that are sufficient enough to affect unemployment.

With the affordable care act, it's also not easy to quantify.

Taking people who currently use ER facilities via EMTALA and putting them under MedicAid; we hear of the cost of putting them under MedicAid but we do not hear how that would affect the formerly "free" services that got transferred to costs for insured.

Even though we keep hearing that it's a job killer for small business, it only applies to businesses with more than 50 employees.

For businesses with less than 50 employees, it means not only health care for those employees, but portable health care that is not tied to the employer which means they can switch jobs and keep their health care.

Is that also a reason why small business would oppose the ACA?

I see the ACA as a boon for people who must or would like to change jobs but often are restrained by the benefit package.

We made pensions portable. How about health care?

 
At 9/04/2012 8:25 AM, Blogger Aiken_Bob said...

Comments are interesting - seems everyone is going to their respected corners. Not a lot of give and take. It is going to be hard to solve our issues without a great deal of sacrifice by those on the dole. To me the real key is that over the years we have more folks on the dole, however you define the dole (welfare, disability, food stamps, corn and sugar grants, lower than reality loans, Obamacare, etc.) There simply aren't enough fat cats to support this crazy world we live in.

 
At 9/04/2012 8:26 AM, Blogger VangelV said...

re: " the stomping boot of government regulation."

re: " the Fed can destroy the currency "

are these issues only with the US or are these things that are present in most every government?


All countries have the same problem.

 
At 9/04/2012 8:28 AM, Blogger Larry G said...

re: on the dole

I do not disagree but can we really balance the budget but cutting only the "dole"?

Is the "dole" the only thing that has increased in govt spending? DOD?

 
At 9/04/2012 8:30 AM, Blogger Unknown said...

The real issue is Carpe Diem is a Political blog not an economics blog even with the credentialed Mark Perry as the author. So conversations turn to arguments and name calling based on politcal orientation and not much more. Ocassionally there are some meaty points of view that are credible on both sides but finding agreement is but a fantasy

 
At 9/04/2012 8:38 AM, Blogger Aiken_Bob said...

Larry - DOD as a percent of the budget are way down from the cold war, even with the cost of Iraq and Afghanistan. Does DOD waste money -- obviously. Do other agencies waste a whole lot more money - even more obvious. I can't understand the thinking that puts DOD on top of the chopping block. The chopping block needs to be really BIG - I'm not so concern with who is first, but that cuts are made.

 
At 9/04/2012 8:39 AM, Blogger Methinks said...

Unknown,

Ever heard of political economy? Economics and politics are not so easily estranged from one another.

I don't think that agreement is nearly as important in a free society as liberty. Otherwise, it's not really a free society and we really have some version of central planning with everyone arguing about who gets to do the planning.

 
At 9/04/2012 8:56 AM, Blogger Larry G said...

re: " DOD as a percent of the budget are way down from the cold war"

this is true but DOD has more than doubled since 2000 and that's just DOD not counting the other parts of "national defense" like homeland security, the VA, military and civilian health care and pensions,etc.

and when you see that we spend for DOD more than the next 10 countries COMBINED -

... well.. how do you truly determine how much to spend on defense?

remember also, "defense" is predominately govt employees - salaries and benefits and private companies contracting for material - more jobs in the economy.

If you rule out DOD for cuts - there is no chance to balance the budget and bring down the debt.

It's fiscally untenable.

the question to me is - for the folks who say they are serious about balancing the budget - how can they rule out DOD and still be serious?

re: politics and the economy

they are so intertwined, that ..like this conversation we're having about DOD and entitlements that politics is central to the issue.

It is totally unrealistic to think POLITICALLY that only entitlements will be cut ...

make no mistake.

I AGREE that entitlements must be cut but my bottom line is a balanced budget not just "cuts".

I want to see a plan to balance the budget not a plan to just cut entitlements.

 
At 9/04/2012 10:29 AM, Blogger Buddy R Pacifico said...

"
Ever heard of political economy? Economics and politics are not so easily estranged from one another."


Here is a suggested bumper sticker that half the country could brandish:

I receive entitlements and I vote.

 
At 9/04/2012 10:32 AM, Blogger Jon Murphy said...

Larry-

Regarding Dodd-Frank and ACA:

What makes Dodd-Frank challenging is that when the law was passed, none of the rules were written. Most still aren't. However, financial institutions are still expected to comply with these rules (although they don't exist). Financial institutions are hesitant to make any major moves simply because they don't know if it will come back to bite them in the butt. the main phrase in banking is CYA (cover your ass). Seeing as they don't know what will be flung at them, they are acting very very cautiously. Now, while you may argue that is a good thing (there is a very good argument to be made there), one must also realize that this has affected the ability of banks to loan funds to companies.

Regarding ACA, you are right that the majority of the provisions affect companies with 50+ employees. However, there are many companies on that bubble. I can tell you a number of small businesses in Concord, New Hampshire do not like the new law as it has prevented them from expanding their businesses. This one restaurant/pub downtown (the Barley House, which, if you are ever in Concord, you have to go to) has plans to expand into Manchester. However, under the ACA, his employee count would now be over 50. He told me that he had to scrap his plans to expand because he would be unable to afford buying health care for all his employees.

Now, this is just one story, so take it for what it's worth, but it does demonstrate a basic economic lesson: every action has consequences, both seen and unseen.

For the record, I do think the US health care system needs reform. I am just not sure the ACA is the best way to accomplish it. It doesn't really provide health care. It mandates health insurance (and, even then, provides almost no guidance to insurance companies. They cannot deny you coverage because of a pre-existing condition, but they can deny you care). To be perfectly honest, I would have preferred universal health care to this hodge-podge plan. At least that would have been constitutional. But I digress

 
At 9/04/2012 10:49 AM, Blogger VangelV said...

I can't understand the thinking that puts DOD on top of the chopping block. The chopping block needs to be really BIG - I'm not so concern with who is first, but that cuts are made.

I can. There is no need for the taxpayer to pay for the defense of Europe, Japan, or South Korea and no need to give foreign aid that is recycled back as military hardware purchasers. I do not see the point of arming al Qaeda because what happens after Assad falls and it turns on Israel, Iran, or Saudi Arabia? It was pointless invading Afghanistan because the cost in manpower, lives, and money was not worth it.

When you have massive deficits you have to cut. And most defense operations are non-value added activities where cuts should be easy to make. Bring the troops back home and stop wasting money trying to police the world.

 
At 9/04/2012 10:53 AM, Blogger VangelV said...

I don't think that agreement is nearly as important in a free society as liberty. Otherwise, it's not really a free society and we really have some version of central planning with everyone arguing about who gets to do the planning.

Free society? Did you look at the GOP primary process and convention where the rules were broken so that the party can approve the candidate that the voters must pick? The Republicans managed to make Iranian elections look good in comparison. Take a look at how the media ignores the non-mainstream candidates and the rules that make it nearly impossible for an outside party to have an impact and then try to figure out how we can talk about a free country.

 
At 9/04/2012 11:13 AM, Blogger Unknown said...

Well,I have proven my politcal blog statement and how points are made by throwing hand granades at each other. I certainly do not believe in central planning except very limited at the Federal gov't level like FEMA response, Interstate Highway system where state and local governments have substanial inputs in the process. I certainly don't like the Dept of Education but the DOD, CIA and FBI need "central planning" But I am lost as to what is the definition of a free society. Do do drugs, alleyway abortions, grow and sell your own pot? Limited to what is in the Constitution? Whose interpretation?

 
At 9/04/2012 11:25 AM, Blogger Methinks said...

When you can come up with reasonable questions instead of the "hand grenades" you complain about, then we can have a reasonable discussion.

And...uh....last I checked, the FBI had nothing to do with economics. So, go on confirming your biases no matter how idiotic they are - about this blog or anything else. The world has survived far worse nonsense.

 
At 9/04/2012 11:34 AM, Blogger bart said...

The "pathology of optimism" lives on.


I am pessimistic for primarily one reason and will remain so until substsntial and real actions occur, expressed well by Jesse:

"The Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustained recovery."

 
At 9/04/2012 11:38 AM, Blogger morganovich said...

peak-

i'm not so sure about this one foot on the brake one on the accelerator thing.

i think the problem is that he has mistaken the brake for the gas.

stimulus does not work. every $1 of pork crowds out $1.20 in private investment.

loose money does not work either. we have reached the point where zirp and twist do more damage to buying power by diminishing income for retirees than they help in cheap loans.

worst of all, we are back into an period (as under carter) with wildly discretionary monetary, tax, fiscal, and regulatory policy all of which freezes activity by making the environment too uncertain for business to invest.

i hear this refrain day in and day out. companies just have no idea how to navigate this and are hoarding cash and playing very conservatively.

the mess of a debt bubble in non productive assets bursting is difficult enough to clean up by itself, but adding this level of uncertainty and tax/regulatory burden to the economy is disastrous.

obama is repeating all the mistakes of fdr who took a nasty bubble and turned it into a depression.

 
At 9/04/2012 12:27 PM, Blogger spotteddog said...

September 1992 Time magazine piece smells to me like propaganda against the then incumbent president. They had a reason to be pessimistic. They wanted Bubba elected.
Besides, it being not true then has no relationship to what's happening now.

 
At 9/04/2012 12:29 PM, Blogger spotteddog said...

Benjamin: I 'll bite.
"The problem now is a dithering, feeble Fed, directionless. It seems intent on fighting inflationary ghosts, while the USA becomes Japan."
What is the Fed doing to fight inflation now? ZIRP? QEn? Sorry, I don't see it. And if they are fighting it they are losing if my wallet is any evidence.

 
At 9/04/2012 12:57 PM, Blogger Larry G said...

re: the uncertainty of Dodd-Frank

worse than other regs?

re: ObamaCare and small business

effect on 50-employee business who want to grow to more than 50.

good point. not sure how this is dealt with if employees get their own when the business is under 50 and then grows.

can this issue alone be the entire problem with ObomaCare? I doubt it.

Most folks who work for small business have not-so-good- health insurance if at all.

I would think that the availability of affording health insurance would help small businesses even ones growing being 50 because people will be much more likely to take a job they like rather than feel trapped in a job they hate but has health insurance.

I see this as ultimately a boon for small business, or even medium-sized businesses that cannot afford to provide health care.

This would actually boost entrepreneurship and risk taking if people's health care is assured.!

 
At 9/04/2012 1:07 PM, Blogger Jon Murphy said...

worse than other regs?

Yes, I think so, mainly because of how sweeping the legislation is and the fact that much of it hasn't been written yet. At least with other regulations, you knew what was being targeted and could take actions. Not so much with Dodd-Frank.

This is an area where it will ultimately come down to individual assessments. It's hard to argue something like "regime uncertainty" as there is no way to put a reliable number on it.

see this as ultimately a boon for small business, or even medium-sized businesses that cannot afford to provide health care.

This would actually boost entrepreneurship and risk taking if people's health care is assured.!


Well, that's a rather optimistic attitude. Right on, brother!

 
At 9/04/2012 1:09 PM, Blogger Larry G said...

re: dodd-frank.

my understanding is that the GOP has no real plans to repeal it if they win.

wrong?

 
At 9/04/2012 1:36 PM, Blogger Jon Murphy said...

my understanding is that the GOP has no real plans to repeal it if they win.

wrong?


That is my understanding as well, yes.

 
At 9/04/2012 2:00 PM, Blogger Ron H. said...

"are these issues only with the US or are these things that are present in most every government?"

Those are issues with any government that follows boot stomping policies and activist central bank policies. We can clearly see where it leads by observing problems in other countries such as Greece.

"If someone were going to differentiate between all govts and the specific things the US govt is doing differently -and much worse - what would they be?"

The US hasn't traveled as far down the boot stomping and money destroying path as many other countries, and could learn from the mistakes of others. That no lessons are being learned and no changes in course contemplated, despite the loud alarm bells, is what makes it "much worse".

 
At 9/04/2012 2:08 PM, Blogger juandos said...

larry g says: "my understanding is that the GOP has no real plans to repeal it if they win.

wrong?
"...

jm says: "That is my understanding as well, yes"...

Hmmm, well I for one wouldn't be shocked if the R.I.N.O. heavy GOP did nothing either...

Yet there was this in the New York Times blog dated June of this year: Romney Says He Will ‘Repeal Obamacare’ if Elected

Romney booed at Parasite convention for promising to repeal Obamacare

 
At 9/04/2012 2:26 PM, Blogger Jon Murphy said...

He can promise all he wants, but the reality is he doesn't have that much power. In order for the law to be repealed, it must be voted for repeal by 2/3 of the Senate. The Republicans will not have that kind of super-majority come next year. At this point, it is all rhetoric, and useless rhetoric at that.

 
At 9/04/2012 2:34 PM, Blogger hancke said...

http://www.theonion.com/articles/drunken-ben-bernanke-tells-everyone-at-neighborhoo,21059/

You guys should get a kick out of this.

 
At 9/04/2012 2:34 PM, Blogger hancke said...

http://www.theonion.com/articles/drunken-ben-bernanke-tells-everyone-at-neighborhoo,21059/

You guys should get a kick out of this.

 
At 9/04/2012 2:49 PM, Blogger Jon Murphy said...

That is pretty hilarious! Thanks, man

 
At 9/04/2012 2:51 PM, Blogger Ron H. said...

Ed R:

"Actually some economists do have a name for our current condition. The name is "liquidity trap"."

You might find this article on the liquidity trap of interest.

It's fairly long and begins with some good background, but of particular interest is the section titled "Austrian Economics and Economic Restructuring" about 1/3 of the way down.

 
At 9/04/2012 3:03 PM, Blogger Paul said...

"He can promise all he wants, but the reality is he doesn't have that much power. In order for the law to be repealed, it must be voted for repeal by 2/3 of the Senate."

Not necessarily. He could probably grant waivers to everyone the same way Obama has given waivers to his mostly union thug supporters. They can also use reconciliation.. According to Heritage: "Reconciliation was used to push Obamacare through the Senate in 2009. Generally reserved strictly for budget-related measures, it eliminates the possibility of a filibuster, meaning Republicans would only need 51 votes to repeal that portion of the law – or even the full law itself."

 
At 9/04/2012 3:12 PM, Blogger Methinks said...

i think the problem is that he has mistaken the brake for the gas.

I think you are correct, Morganovich. Bush didn't have much luck finding the accelerator either. Remember when he sent checks to all those people who don't pay taxes? Lovely.

Also, notice how the "temporary" stimulus is not a permanent part of the budget? Even if the multiplier weren't negative to a fraction, this is how "temporary" stimulus happens in the context of real world politics.


 
At 9/04/2012 3:16 PM, Blogger Jon Murphy said...

Interesting point, Paul, but I've never heard of reconciliation being used to repeal a law. Can that be done? Has it been done?

I am legitimately asking. I don't know

 
At 9/04/2012 3:35 PM, Blogger Ron H. said...

"For businesses with less than 50 employees, it means not only health care for those employees, but portable health care that is not tied to the employer which means they can switch jobs and keep their health care."

You are missing the fact that due to the breakpoint at 50, a small businesses with less than 50 will do everything possible to avoid hiring that 50th worker, and those with slightly over 50 may find they can do just as well with fewer. That's a job killer. Incentives matter.

"I see the ACA as a boon for people who must or would like to change jobs but often are restrained by the benefit package."

Everyone considers total compensation in any decision about changing jobs. Employers compete for valuable workers by offering a various combinations of wages and benefits including healthcare coverage. Surely you agree that employers should be able to bid higher than their competitors for workers.

That type of decision making won't change much by taking basic healthcare benefits out of the mix.

"We made pensions portable. How about health care?"

"We" didn't do anything of the sort. First of all, there is no requirement that an employer offers retirement benefits at all. It is something that is offered to attract valuable workers, and without which many employers would have trouble competing. Secondly, Giving up responsibility for managing an employees retirement plan is a blessing. Contribution is the easy part.

 
At 9/04/2012 3:36 PM, Blogger Paul said...

Jon,

"Interesting point, Paul, but I've never heard of reconciliation being used to repeal a law. Can that be done? Has it been done?"

According to SCOTUS, it's a tax. Filibuster not applicable.

 
At 9/04/2012 3:38 PM, Blogger Jon Murphy said...

Just the individual mandate is a tax (one which is unenforceable, by the way. The IRS has no authority to collect it under the law). The courts never said if the law could survive without the mandate, did they?

 
At 9/04/2012 3:56 PM, Blogger Paul said...

Jon,

The GOP believes they can repeal the full law via reconciliation. Not sure how SCOTUS ruled, if at all, on severability.

 
At 9/04/2012 3:57 PM, Blogger Ron H. said...

"good point. not sure how this is dealt with if employees get their own when the business is under 50 and then grows."

Oh boy. How can I put this?

Businesses do not - DO NOT - grow without awareness of the owners and managers. No one goes to work one day to find he now has more than 50 employees. That magic number is reached when someone takes the conscious, positive action of hiring another person.

That's sopmething they won't do considering the sudden increased costs involved.

"can this issue alone be the entire problem with ObomaCare? I doubt it."

This is one of the less important problems with it.

 
At 9/04/2012 4:00 PM, Blogger juandos said...

"He can promise all he wants, but the reality is he doesn't have that much power. In order for the law to be repealed, it must be voted for repeal by 2/3 of the Senate"...

No argument there jm but even without the 2/3 needed it can still be killed by defunding...

I really don't think there's enough supposed conservatives in the House that have the cojones to do this though...

 
At 9/04/2012 4:01 PM, Blogger Ron H. said...

"re: the uncertainty of Dodd-Frank

worse than other regs?
"

That has no bearing on anything. Dodd-Frank is bad - period. There's no point in discussing its relative badness.

 
At 9/04/2012 4:03 PM, Blogger Ron H. said...

"It's very hard to really quantify Dodd-Frank as compared other prior regulations."

Not only is it hard, it's pointless.

 
At 9/04/2012 4:10 PM, Blogger Ron H. said...

"I do not disagree but can we really balance the budget but cutting only the "dole"?"

Balancing the budget is a worthy goal, but it can only ever happen by reducing spending. "the dole" is one of those things. Defense is another. There are millions of others. If you wish to wait until everyone agrees on what should be cut and by how much, it will never happen.

 
At 9/04/2012 4:12 PM, Blogger Ron H. said...

Unknown: "Ocassionally there are some meaty points of view that are credible on both sides but finding agreement is but a fantasy."

Why do you believe finding agreement is important?

 
At 9/04/2012 4:13 PM, Blogger PeakTrader said...

Morganovich, I find it amazing how you make assumptions without any support, except your assumptions.

 
At 9/04/2012 4:14 PM, Blogger Jon Murphy said...

No argument there jm but even without the 2/3 needed it can still be killed by defunding...

I had forgotten about that.

 
At 9/04/2012 4:14 PM, Blogger Jon Murphy said...

Businesses do not - DO NOT - grow without awareness of the owners and managers.

You'd be a pretty bad manager if you just walked in one day and said "shit, we hired new people? When did that happen?"

 
At 9/04/2012 4:17 PM, Blogger Ron H. said...

"remember also, "defense" is predominately govt employees - salaries and benefits and private companies contracting for material - more jobs in the economy.."

Yes. It is good to hire people to dig holes then fill them back in.

Wouldn't it be cheaper overall and safer for them as well if military people were just paid to sit at home playing video games rather than sending them halfway around the world to get shot at?

 
At 9/04/2012 4:23 PM, Blogger Larry G said...

" Wouldn't it be cheaper overall and safer for them as well if military people were just paid to sit at home playing video games rather than sending them halfway around the world to get shot at? "

there's a certain amount of futility in sending young people overeas to get sliced and diced ... use heroic efforts to save their lives then send them back to the US to be fitted with prosthetic and other paraphernalia so they can then get a job and live a normal life.

We don't seem to learn that lesson.

 
At 9/04/2012 4:30 PM, Blogger LeaMikhaela said...

landscaping services range from residential home landscaping to commercial landscaping to condominium associations landscaping. they provide design and consultation services as well as free quotes.

landscapers pittsburgh

 
At 9/04/2012 4:32 PM, Blogger Ron H. said...

Jon M:

"At least that would have been constitutional. But I digress "

Perhaps you can explain your basis for that wildly inaccurate statement?

 
At 9/04/2012 4:44 PM, Blogger Larry G said...

looks like companies with over 50 employee benefit also:

http://www.healthcare.gov/news/factsheets/2011/08/small-business.html

this, by the way has little to do with the existing deficit and many provisions kick in - in 2014.

this seems to be politics - not budget.

 
At 9/04/2012 4:46 PM, Blogger bart said...

PeakTrader said...

Morganovich, I find it amazing how you make assumptions without any support, except your assumptions.


ROFL!!!

Pot.Kettle.Black.^100

 
At 9/04/2012 4:47 PM, Blogger sethstorm said...


Businesses do not - DO NOT - grow without awareness of the owners and managers. No one goes to work one day to find he now has more than 50 employees. That magic number is reached when someone takes the conscious, positive action of hiring another person.

Now what would happen if structuring regulations (from bank laws) were brought in to heavily discourage such unproductive screwiness on hiring?

That is, you hire 49(or anywhere close) employees, or go through some screwy contractor to get around that limit, you're deemed to have passed the limit.

 
At 9/04/2012 5:12 PM, Blogger Paul said...

"this seems to be politics - not budget."

CBO estimates Obamacare will cost about $ 2 trillion over a decade(2014 through 2023.) Only Larry could deem that "not budget."

 
At 9/04/2012 5:24 PM, Blogger Larry G said...

" In 2014, small businesses with generally fewer than 100 employees can shop in an Affordable Insurance Exchange, which gives you power similar to what large businesses have to get better choices and lower prices. An Exchange is a new marketplace where individuals and small businesses can buy affordable health benefit plans."

http://www.healthcare.gov/news/factsheets/2011/08/small-business.html

looks like small businesses actually benefit come 2014.

Not sure I've seen anything specific - that is actually true yet.

we have lots of "info" but it does not seem to conform to the fact sheets for the Affordable Care Act.

I'd feel a whole lot more trusting if I hear BOTH the give AND the take rather than just a list of bad things.. some of which don't seem to check out.

wouldn't it be more instructive to list the good things and then list the downsides?

These "exchanges" are very similar to the current health care options offered to government employees including DOD.

here:

http://www.opm.gov/insure/health/planinfo/types.asp

but the difference is that anyone can sign up for a plan regardless of their health status - and everyone will get charged the same premium.

so access to insurance is guaranteed as well as the price.

this is the same deal that is offered to all govt employees including the military and including Congress already.

CBO has crunched the numbers and believes the larger pool of enrollees will offset those who currently use ERs and EMTALA which cost-shifts charity care to those who have insurance.

It may well not be the best approach but it's better than any alternative offered.

no real alternatives have even been offered much less ones that could be scored by CBO.




 
At 9/04/2012 5:24 PM, Blogger Ron H. said...

Jon:

"The courts never said if the law could survive without the mandate, did they?"

Not sure the SCOTUS said anything about it, but without a mandate no one would buy coverage until they needed medical treatment. Sort of like calling for auto coverage after you wreck your car.

 
At 9/04/2012 5:26 PM, Blogger Larry G said...

" CBO estimates Obamacare will cost about $ 2 trillion over a decade".

how much with EMTALA charity care cost others over than same period without OC?

 
At 9/04/2012 5:34 PM, Blogger Jon Murphy said...

Perhaps you can explain your basis for that wildly inaccurate statement?

Ron-

Much of the SCOTUS precedence regarding public utilities would allow the government to create universal health care, should it so desire. While our interpretation of the Constitution may be different, the point is the legal precedence is there.

 
At 9/04/2012 5:38 PM, Blogger Larry G said...

Medicare is an individual mandate and a payroll tax,

right?

If ObamaCare had been ruled un-Constitutional, wouldn't Medicare have been also affected?

 
At 9/04/2012 5:39 PM, Blogger PeakTrader said...

Bart, sure, you need all the help you can get to defend your 10% annual inflation rate.

 
At 9/04/2012 5:53 PM, Blogger Ron H. said...

"You'd be a pretty bad manager if you just walked in one day and said "shit, we hired new people? When did that happen?""

They didn't build that. They didn't hire themselves.

 
At 9/04/2012 6:04 PM, Blogger Ron H. said...

"looks like companies with over 50 employee benefit also:"

1. Tax credits? Who is making up the difference, or is it borrowed money?

2. Consider the source of this info.

3. If all small business owners are going to be better off than before, why do so many of those dumbasses complain about it? Don't they understand simple math?

 
At 9/04/2012 6:08 PM, Blogger Ron H. said...

Bart: "Pot.Kettle.Black.^100"

This completely accurate observation has had little impact on your target audience in the past.

 
At 9/04/2012 6:20 PM, Blogger Larry G said...

1. tax credits.. just like tax credits for untaxed employer-provide health insurance, eh?

2. source ? I'll take the govt over the standard propaganda outlets.

3. re: all businesses - you have more people in the insurance pool at an earlier age.

this seems to be why other industrialized nations have 1/2 the costs we do.

but the big thing we overlook here is that people without insurance still use the health care system and the costs are cost-shifted to others - as opposed to those folks not getting care.

Unless or until, the REPEAL actually INCLUDES EMTALA and MedicAid - the folks who don't have insurance just get it via EMTALA and MedicAid but they usually wait until their disease is progressed to a much expensive stage.

 
At 9/04/2012 6:20 PM, Blogger Paul said...


"but the difference is that anyone can sign up for a plan regardless of their health status - and everyone will get charged the same premium."

So a fat slob who drinks and smokes will pay the same premium( unless he falls into the subsidized income group) as an individual who takes care of himself.
Larry sees that as a good thing.

"..how much with EMTALA charity care cost others over than same period without OC?"

A) So it is a budget item.
B) Obamacare’s individual mandate doesn’t allow people to buy inexpensive insurance focused on emergency care. Rather, it forces people to buy comprehensive insurance packages that far exceed those required to address the issue of uncompensated emergency room care.
C) Obamacare's Medicaid expansion and subsidies for insurance coverage for lower income groups mean many of those "charity cases" are now a feature, rather than a side effect of our health care system. Now they will have official coverage they didn't pay for instead of just showing up at the emergency room. So the freeloaders are still there, and now they will consume healthcare about 2x as often, according to statistics.




 
At 9/04/2012 6:21 PM, Blogger PeakTrader said...

Ron, I supported my statements with math and data.

Obviously, a percentage of the population will continue to cling to their false assumptions regardless of any proof.

That's not my problem.

 
At 9/04/2012 6:23 PM, Blogger Paul said...

"..this seems to be why other industrialized nations have 1/2 the costs we do."

~Larry's ass

 
At 9/04/2012 6:28 PM, Blogger Larry G said...

" So a fat slob who drinks and smokes will pay the same premium( unless he falls into the subsidized income group) as an individual who takes care of himself."

I'd go along with extra costs for these guys if it also applied to employer-provided.

re" free loaders..

a principled stand against ObamaCare would recognize the backdoor strategies with EMTALA and Medicare and advocate repeal of all 3 so slobs and freeloaders are shut out.

right?

Who's making that proposal?

 
At 9/04/2012 6:38 PM, Blogger Paul said...

"I'd go along with extra costs for these guys if it also applied to employer-provided."

My employer insurance has a non-smoker benefit. However, we need to get away from employer provided insurance. Nobody is saying the current system is perfect. Obamacare just makes it much, much worse.

"a principled stand against ObamaCare would recognize the backdoor strategies with EMTALA and Medicare and advocate repeal of all 3 so slobs and freeloaders are shut out."

Huh? A principled stand can begin with repeal of Obamacare.



 
At 9/04/2012 6:42 PM, Blogger Larry G said...

re: " Huh? A principled stand can begin with repeal of Obamacare"

even if the uninsured end up getting care through EMTALA or MedicAid and it's more expensive?

what are we really after?

are we really after cutting costs or are we after something else?

I assumed that cost is the complaint about ObamaCare but if people just seek care though other options and we still get the costs, have we really accomplished anything?

the employer-provided tax credit would, in essence, come from the cost savings from people not using MedicAid/Emtala.... right?

 
At 9/04/2012 6:56 PM, Blogger Ron H. said...

"Now what would happen if structuring regulations (from bank laws) were brought in to heavily discourage such unproductive screwiness on hiring?"

As a fascist it must please you to contemplate government micromanagement of every aspect of a small business, but you should realize that these are the very people who create many of the jobs you think you should have as an absolute right, and by making it more difficult for them to do business you are stepping on your own dick.

"That is, you hire 49(or anywhere close) employees, or go through some screwy contractor to get around that limit, you're deemed to have passed the limit"

It doesn't matter whether the magic number is 50 or 49 or 47, or 2. At whatever number a business is "deemed" to have crossed some threshold, hiring will stop below that number. No one will hire that next employee if it costs them $400k to do so.

Small firms will turn away business rather than expand to meet demand, and will select only the most lucrative work. They will hire only the best qualified employees, while turning away those with less experience or skill. That means you might never work again.

Your ideas didn't work well in the former Soviet Union and they won't work here because incentives matter.

Your plan does just the opposite of what you would do if you really cared about jobs instead of having a bizarre and obsessive urge to smite employers.

 
At 9/04/2012 6:59 PM, Blogger Ron H. said...

"so access to insurance is guaranteed as well as the price."

That's not a description of insurance.

 
At 9/04/2012 7:03 PM, Blogger Ron H. said...

"An Exchange is a new marketplace where individuals and small businesses can buy affordable health benefit plans."

Will you read me another fairy tale when you're done with this one?

Marketplaces are not created by government fiat, and "affordable" is a meaningless word.

 
At 9/04/2012 7:09 PM, Blogger Larry G said...

it's the way that employer provided insurance works including the Fed Govt insurance for both civilian and military subscribers.

it's not pure free-market insurance.

the free market would not provide access to insurance to many who would then get their care provided by taxpayers and the people who do have insurance.

right?

 
At 9/04/2012 7:09 PM, Blogger Paul said...

"even if the uninsured end up getting care through EMTALA or MedicAid and it's more expensive?"

More expensive than Obamacare? Nonsense. Medicaid is expanded under Obamacare. And as I pointed out, cheaper catastrophic coverage will be made unavailable.

"are we really after cutting costs or are we after something else?"

Who is "we?" Liberals are after centrally planned medical care. Most of the people who post here think that's an abomination.

 
At 9/04/2012 7:12 PM, Blogger Larry G said...

the "exchange" is essentially very similar to the health care plans that Congress and Federal employees and military have.

you'd do away with them also?

 
At 9/04/2012 7:12 PM, Blogger Ron H. said...

"1. tax credits.. just like tax credits for untaxed employer-provide health insurance, eh?"

You have missed the mark on this one.

"2. source ? I'll take the govt over the standard propaganda outlets."

Heh. Do you mean like the CBO?

"3. re: all businesses - you have more people in the insurance pool at an earlier age."

I guess stupid small business owners can't figure that out for themselves. What are they complaining about then?

 
At 9/04/2012 7:46 PM, Blogger bart said...

Ron H. said...

Bart: "Pot.Kettle.Black.^100"

This completely accurate observation has had little impact on your target audience in the past.



Very true about PT and others, but it does get them foaming at the mouth and doing bare faced lying, etc., which helps illustrate (for those who might wonder) where their heads are really at.

I was very amused at his lying allegation that my CPPI (aka real inflation measure) was at 10%, when it's actually at 4.5%, about 3% higher than the bugus CPI-U.

 
At 9/04/2012 7:48 PM, Blogger bart said...

PeakTrader said...

Ron, I supported my statements with math and data.

Obviously, a percentage of the population will continue to cling to their false assumptions regardless of any proof.



Pot.Kettle.Black.^1000

 
At 9/04/2012 9:01 PM, Blogger Methinks said...

Peak,

I don't understand you. You seem to have only two modes - totally sane and completely bonkers. You are a walking contradiction.

 
At 9/04/2012 9:32 PM, Blogger Ron H. said...

"the "exchange" is essentially very similar to the health care plans that Congress and Federal employees and military have."

You've read all that in the 2700 page bill, so you know that's correct, is that it?

"you'd do away with them also?"

You can't just change the subject like that and expect to keep right on going.

 
At 9/04/2012 9:35 PM, Blogger Ron H. said...

"what are we really after?

are we really after cutting costs or are we after something else?
"

"We" aren't after anything, Larry, there is no "we".

When you learn to frame your comments correctly it's possible you will get better responses.

 
At 9/04/2012 9:38 PM, Blogger VangelV said...

To be perfectly honest, I would have preferred universal health care to this hodge-podge plan. At least that would have been constitutional.

How? What in the constitution allows the federal government to push for universal coverage when healthcare seems to be a state matter at most. (And even that seems to be pushing it.)

 
At 9/04/2012 9:42 PM, Blogger Ron H. said...

Jon:

"Much of the SCOTUS precedence regarding public utilities would allow the government to create universal health care, should it so desire. While our interpretation of the Constitution may be different, the point is the legal precedence is there."

Maybe it's just my poor search skills, but I'm unable to find a case involving Federal law and public utilities that provides precedent for Obamacare. What were you referring to?

 
At 9/04/2012 9:52 PM, Blogger VangelV said...

I certainly do not believe in central planning except very limited at the Federal gov't level like FEMA response, Interstate Highway system where state and local governments have substanial inputs in the process. I certainly don't like the Dept of Education but the DOD, CIA and FBI need "central planning" But I am lost as to what is the definition of a free society. Do do drugs, alleyway abortions, grow and sell your own pot? Limited to what is in the Constitution? Whose interpretation?

It seems to me that you are very comfortable with big government and central planning.

A free society is a voluntary in which nobody has the right to initiate force and that clearly includes the government. It is obvious that we do not need states for peace and order because states are inherently corrupt and violent institutions. We don't need to have the state prohibit drugs because such prohibition does little to affect usage rates and creates unintended consequences that lead to violence and waste. Washington grew pot. Most of the drugs that are illegal today could have been purchased from your local pharmacist a century ago yet the addiction rates are around the same.

 
At 9/04/2012 9:55 PM, Blogger VangelV said...

According to SCOTUS, it's a tax. Filibuster not applicable.

Correct. All that is needed are 51 votes in the senate.

 
At 9/04/2012 9:55 PM, Blogger Hydra said...

Peak work.

Everyone should take more time off.

 
At 9/04/2012 9:59 PM, Blogger Hydra said...

Funny, none of that applies to my situation.

Not suggesting that your comments do not aply to many, but that does not make your view the only reallity.

 
At 9/04/2012 10:03 PM, Blogger Hydra said...

If i thought i could get reliable private heallth insurance, I would start a business tomorrow.

 
At 9/04/2012 10:13 PM, Blogger Hydra said...

The fat cats do not support the world we live in. That gets done by the mechanics, hvac maintenance personnel, the computer geeks, the nurses, and the teachers, the lumberjacks and sawyers, the clerks, and the pothole menders, the ambulance drivers, the farmhands, the non-coms, and the subcontractors.

Are you suggesting that if there were enough fst cats to support the world we live in, that they would suddennly be willing to do it?

 
At 9/04/2012 10:15 PM, Blogger Hydra said...

Hi, Tom. Glad you decided to join in.

 
At 9/04/2012 10:17 PM, Blogger Hydra said...

You have an example of decentralized planning?

Don't corporations depend on central planning?

 
At 9/04/2012 10:20 PM, Blogger Hydra said...

The environment and the economy are as closely entwined as politics and the economy.

If anything, the current csmpaign provides a new definition of the political economy.

 
At 9/04/2012 10:21 PM, Blogger Hydra said...

We get the best politicians money can buy.

 
At 9/04/2012 10:25 PM, Blogger Hydra said...

Bull hockey. If financial institutions just do what is right and fair, they will have little to worry sbout.

Of course, that may mean a whole new approach to business.

 
At 9/04/2012 10:27 PM, Blogger Hydra said...

We probably could have bought afghanistan and north korea for what we have soent on them.

 
At 9/04/2012 10:32 PM, Blogger Hydra said...

Almost all of the workforce works for only 13000 large corporations. Most smsll businesses take more than a decade to reach even ten employees, and most fold long before then.

 
At 9/04/2012 10:35 PM, Blogger sethstorm said...


It doesn't matter whether the magic number is 50 or 49 or 47, or 2. At whatever number a business is "deemed" to have crossed some threshold, hiring will stop below that number. No one will hire that next employee if it costs them $400k to do so.

That's why I suggested the idea of bringing anti-structuring laws over.

When someone constructs a numerical limit for a regulation, structuring laws are necessary to make it nigh-impossible to avoid. Otherwise you get things like 49-employee syndrome.


Small firms will turn away business rather than expand to meet demand, and will select only the most lucrative work. They will hire only the best qualified employees, while turning away those with less experience or skill. That means you might never work again.

Given that they're already less stable than Fukushima on a good day (and more likely to fail than a rowboat in a hurricane), you're telling me nothing new. Such small firms would also be doing a disservice by being the constant source of complaints that could be addressed by the business training people that are less than "perfect".

SMB's want to be the solution but do a lot of things to be the problem, as you have addressed in that part of your reply.

 
At 9/04/2012 10:36 PM, Blogger Hydra said...

We could let them sit at home until they get shot at. We did that in 1812, WWII.

911 only proves how little time we will have to call up the militia next time.

 
At 9/04/2012 10:40 PM, Blogger Hydra said...

Where is the Republican alternative?

Massachusetts?

 
At 9/04/2012 10:46 PM, Blogger sethstorm said...


Almost all of the workforce works for only 13000 large corporations. Most small businesses take more than a decade to reach even ten employees, and most fold long before then.

Aside from those not working directly, it's the best arrangement in terms of stability. That, and it gets around the problem of "not enough resources for training" that SMB's use to justify their endless complaints.

 
At 9/04/2012 11:18 PM, Blogger Hydra said...

That fat smoking slob could also be a healthy actve non smoking 48 year old like i was when i suddenly became disabled and denied coverage.

If you don't think it can hapoen to you, then you are a fool.

 
At 9/04/2012 11:22 PM, Blogger Hydra said...

My bizarre and obsessive desire to smite employers is tempered by the history of employers bizarre and obsessive compulsion to smite their employees.

Equal rights means equal protections, not equal pay.

 
At 9/04/2012 11:25 PM, Blogger Hydra said...

What evidence have you that Larry dupports any of the fascist ideals, such as dictatorship?

 
At 9/04/2012 11:31 PM, Blogger Hydra said...

No. Liberals support a plan under which the affordable risks of health insurance are equally shared: no free riders, and no gold plated policies for the rich, who are as mortal as the rest of us. As in Steve Jobs.

No one is suggesting publicly funded full body transplants. And no one is suggesting that the wealthy cannot have them if they become available.

 
At 9/05/2012 1:41 AM, Blogger Ron H. said...

Peak:

"Ron, I supported my statements with math and data."

If so, why don't you ever let us look at it?

 
At 9/05/2012 2:01 AM, Blogger Ron H. said...

"It may well not be the best approach but it's better than any alternative offered.

no real alternatives have even been offered much less ones that could be scored by CBO.
"

It isn't necessary to offer an alternative to a bad idea. If you suggest that we all jump off a cliff the only alternative needed is "no, let's not."

 
At 9/05/2012 2:31 AM, Blogger Ron H. said...

"911 only proves how little time we will have to call up the militia next time."

How long do you imagine it takes? Bush had been briefed by the CIA on August 6, 2001 on intelligence that al Qaeda planned to use airliners as missiles in attacks on targets in New York, and an FBI memo warned of suspicious looking Middle Eastern men taking flying lessons. No amount of time is enough if action is never started.

911 also shows that having hundreds of installations and 100s of thousands of troops all over the world has no deterrent value against small groups of people who are willing to end their lives by flying into buildings.

 
At 9/05/2012 9:55 AM, Blogger VangelV said...

We could let them sit at home until they get shot at. We did that in 1812, WWII.

Try learning history.

 
At 9/05/2012 9:57 AM, Blogger VangelV said...

Where is the Republican alternative?

You are assuming that the donkeys and elephants are the only choice. But both are corrupt, stupid and have no viable ideas that do not include a bigger state.

 
At 9/05/2012 10:00 AM, Blogger VangelV said...

911 also shows that having hundreds of installations and 100s of thousands of troops all over the world has no deterrent value against small groups of people who are willing to end their lives by flying into buildings.

It shows that those foreign installations can cause small groups who are willing to end their lives to take action against innocent civilians at home.

 
At 9/05/2012 10:34 AM, Blogger Jon Murphy said...

That's why I suggested the idea of bringing anti-structuring laws over.

Look, you're missing the point. If the cost of hiring an extra worker, it doesn't matter if they are temp or perm, exceeds the benefits that extra employee will bring, then he will not be hired. Simple as that.

If you have a company that has 49 employees, is doing well and can expand, but hiring that 50th worker will trigger penalties (and increase in taxes is a penalty), then the owner will not do it. In a free market, that 50th person would have a job. In the way this law is structured, the 50th person is out of a job.

Call the law anything you'd like, but the fact remains the same: if the marginal cost of hiring an extra worker exceeds the marginal benefit, the worker will not be hired and will remain unemployed.

I really don't get it. Politicians make laws that increase the cost of hiring workers, and then complain when companies aren't hiring workers. I mean, are people really this stupid or are they just trying to have their cake and eat it too?

 
At 9/05/2012 10:53 AM, Blogger Larry G said...

in terms of ObamaCare, under 50 does not apply but over 50 gets tax credits and other help.

so small business is helped no matter the number of employees. The thresholds just determine the type of help.

I have yet to see any credible information about costs imposed on small businesses... mostly what I've heard is that they fear the unknown....but the law is pretty clear when it comes to small businesses so the fear of the unknown is somewhat self-inflicted.

 
At 9/05/2012 12:19 PM, Blogger Ron H. said...

Jon:

"I really don't get it. Politicians make laws that increase the cost of hiring workers, and then complain when companies aren't hiring workers. I mean, are people really this stupid or are they just trying to have their cake and eat it too?

They are politicians. Different incentives. Common sense, logic, and economics as we know them aren't used in political decision making.

Of course some folks believe their interests are being represented by elected officials because they were allowed to vote for them.

I believe we should have the option of electing "None of the Above" to political office and leave those positions open.

 
At 9/05/2012 12:25 PM, Blogger Ron H. said...

(1) so small business is helped no matter the number of employees. The thresholds just determine the type of help.

(2) I have yet to see any credible information about costs imposed on small businesses...
"

If #2 is true, then by definition #1 is something you don't know, and is therefore just one more of the thousands of things you have pulled from your ass.

 
At 9/05/2012 12:31 PM, Blogger Ron H. said...

This comment has been removed by the author.

 
At 9/05/2012 12:31 PM, Blogger Larry G said...

If you have up to 25 employees, pay average annual wages below $50,000, and provide health insurance, you may qualify for a small business tax credit of up to 35% (up to 25% for non-profits) to offset the cost of your insurance. This will bring down the cost of providing insurance.

Under the health care law, employer-based plans that provide health insurance to retirees ages 55-64 can now get financial help through the Early Retiree Reinsurance Program. This program is designed to lower the cost of premiums for all employees and reduce employer health costs.
Starting in 2014, the small business tax credit goes up to 50% (up to 35% for non-profits) for qualifying businesses. This will make the cost of providing insurance even lower.

In 2014, small businesses with generally fewer than 100 employees can shop in an Affordable Insurance Exchange, which gives you power similar to what large businesses have to get better choices and lower prices. An Exchange is a new marketplace where individuals and small businesses can buy affordable health benefit plans.
Exchanges will offer a choice of plans that meet certain benefits and cost standards. Starting in 2014, members of Congress will be getting their health care insurance through Exchanges, and you will be able to buy your insurance through Exchanges, too.

Employers with fewer than 50 employees are exempt from new employer responsibility policies. They don’t have to pay an assessment if their employees get tax credits through an Exchange.

http://www.healthcare.gov/news/factsheets/2011/08/small-business.html

 
At 9/05/2012 12:36 PM, Blogger Larry G said...

" Do you really think it's a good idea to spend taxpayer's money on risky small businesses that are likely to fail?"

if it essentially makes health care portable to the employees -

YES!

I think this empowers entrepreneurship!

Health care is a significant drag on people with families who are essentially trapped into jobs that have health care and prevented from moving to more entrepreneurial jobs because they may lose their healthcare.

this law should actually spur more entrepreneurial efforts.


 
At 9/05/2012 12:45 PM, Blogger Ron H. said...

"If you have up to 25 employees, pay average annual wages below $50,000, and provide health insurance, you may qualify for a small business tax credit of up to 35% (up to 25% for non-profits) to offset the cost of your insurance. This will bring down the cost of providing insurance."

Yes, we have all read this effort to put lipstick on a pig, but it won't "bring down the cost of providing insurance", it just shifts part of the cost to someone else.

The question we might ask is why taxpayers should help small businesses pay for employee healthcare coverage.

 
At 9/05/2012 12:49 PM, Blogger Larry G said...

If these folks who get insurance use MedicAid and EMTALA less than before, is that worth it?

besides - the narrative here has been that ObamaCare will hurt small business and now the argument has shifted... to something different.

propaganda - proven wrong = shift argument to something else.

 
At 9/05/2012 12:54 PM, Blogger bart said...

Ron H. said...

If #2 is true, then by definition #1 is something you don't know, and is therefore just one more of the thousands of things you have pulled from your ass.


After reading Larry G's post for a few months, I honestly wonder if he's an astroturfer ( http://en.wikipedia.org/wiki/Astroturfing ) or similar.

 
At 9/05/2012 1:01 PM, Blogger Ron H. said...

"if it essentially makes health care portable to the employees -

YES!
"

Let me make sure I understand your position: You are willing to pay more in taxes so people you don't know can more easily change jobs.

You didn't explain why you thought more job mobility "empowers entrepreneurship". What's the connection?

That's certainly a lofty sounding political slogan, but what does it mean?

 
At 9/05/2012 1:07 PM, Blogger Ron H. said...

"besides - the narrative here has been that ObamaCare will hurt small business and now the argument has shifted... to something different."

Well yes, because you changed the subject from small businesses to employees. Try to keep track of your own arguments. I shouldn't have to do it for you.

 
At 9/05/2012 1:07 PM, Blogger Larry G said...

no astroturfing..

classify me as anti-propaganda and pro-truth ...pro-facts...

there is so much propaganda flying around now days that it's comical.

the latest is that ObamaCare will hurt small businesses...

but if you look at the facts:

http://www.healthcare.gov/news/factsheets/2011/08/small-business.html

you'll see that a whole lot of lying is going on....

I oppose the lying...and favor getting to the truth...

I know.. it's a hell of a thing.. but that's the way it is.

 
At 9/05/2012 1:15 PM, Blogger Larry G said...

Nope. I believe that I showed that small businesses are not being penalized in the way that people are claiming by simply showing some facts.

then the argument switched to if it was a good thing to help them with taxes...

and I pointed out that there are potential money savings by having folks with insurance... that won't be using EMTALA or MedicAid.

we try to rebut propaganda here but it's a neverending job.

 
At 9/05/2012 1:19 PM, Blogger Ron H. said...

"Health care is a significant drag on people with families who are essentially trapped into jobs that have health care and prevented from moving to more entrepreneurial jobs because they may lose their healthcare."

Based on the percentage of new business startups that fail, do you really think taxpayers should encourage even more people who don't know what they're doing to attempt to start their own business?

If so, taxpayers should probably also help pay for their food and rent. Why should THOSE drags on people with families be a stumbling block those who want to quit their jobs and start their own business?

 
At 9/05/2012 1:27 PM, Blogger Larry G said...

" Based on the percentage of new business startups that fail, do you really think taxpayers should encourage even more people who don't know what they're doing to attempt to start their own business?"

But you are not paying taxes for small businesses.

You are exempting them from taxes so they will not be adversely affected.

What you are doing is helping to provide insurance to employees who then can easily change jobs when a small business fails - and still have their insurance.

 
At 9/05/2012 1:28 PM, Blogger Ron H. said...

Bart:

"After reading Larry G's post for a few months, I honestly wonder if he's an astroturfer ( http://en.wikipedia.org/wiki/Astroturfing ) or similar."

LOL

While anything's possible, I don't generally give Larry that much credit.

...unless you think he is an advocate for some Libertarian group that is hoping to shift public opinion against the collectivist nonsense he blathers about.

 
At 9/05/2012 1:30 PM, Blogger Larry G said...

ya'll don't think Ron Paul supporter are acting collectively?

geeze.

who knew?

:-)

 
At 9/05/2012 1:33 PM, Blogger Ron H. said...

"classify me as anti-propaganda and pro-truth ...pro-facts..."

LOL

As if you would know any of those things if you saw them.

Are we now moving from a discussion of Obamacare and it's effect on small business, to your usual claim that you are not advocating, just asking questions? If so I'm done.

 
At 9/05/2012 1:43 PM, Blogger Larry G said...

I'm pointing out some realities and I'm asking if those realities - as opposed to the propaganda - have some merits.

the basic thing I object to is the rampant propaganda with respect to small businesses and ObamaCare.

I'm not necessarily advocating for it but I'm saying that as long as the lies are as thick as flies.. there is no real merit in the debate.

 
At 9/05/2012 1:43 PM, Blogger Jon Murphy said...

I just want to interject for two seconds here, say my bit, and then I'll let you two go back to bashing each other over the heads.

Larry, I understand what you are saying about the tax credits, but the point still remains. To file for these tax credits, that costs money, too (it costs the time of whoever files the taxes, whether it be the owner, an internal accountant, external accountant). Many businesses do not claim the credits because they cost too much.

There was a WSJ article last month on this topic. Of the 36 major tax credits available in 2011, only 20,000 of the 1.8 million businesses in America claimed any of the credits. About 1%. And why not? The tax compliance cost-per-employee has risen. For small businesses, it costs about $1,600 per employee to comply with taxes. Let's say you have 25 employees. That works out to about $40,000. The tax credit would have to be at least that amount. I mean, why take a $25,000 tax credit if it costs you $40,000 to fill out the paperwork (those numbers are contrived).

Nothing is free. Regardless on how you feel about this going forward, you have to realize that the cost of hiring new employees has increased. That means companies will have to 1) raise prices, 2) cut costs elsewhere, or 3) some combination of the two. This also means more money has to be diverted to tax compliance. That means less money to hire new employees, develop new merchandise, donate to the community, etc.

Whether you like the health care law or not, you must realize that costs are being imposed on businesses of all sizes.

 
At 9/05/2012 1:48 PM, Blogger Larry G said...

Jon - I appreciate it but I've not seen any credible, verifiable discussion about the credits and the costs.

I consider WSJ to be an opponent of the health care law.

I'm fine with their opposition if they provide specifics that can be verified.

but if all they do is assert - then they do that with any/all regulations because they are opposed to any/all regulations anyhow.

that's not an objective discussion in my book.

and let me give you a for instance.

I'm quite sure the regulations and reporting for employer-provided health care are also real.

but does WSJ complain about that or point out that there are also regulations for that health care?

I'm looking for some objective discussions that at least acknowledge that the current system also has regulations and reporting requirements.

 
At 9/05/2012 1:56 PM, Blogger Jon Murphy said...

I consider WSJ to be an opponent of the health care law.

I'd go beyond considering and outright call them opponents.

I am trying to find you the article so you can make a judgement call for yourself and not take my word on it. Do you have access to the Journal? The article may be behind a paid firewall. If it is, I will give you my email address, and send you a link that way.

 
At 9/05/2012 2:06 PM, Blogger Larry G said...

Jon... no.. I refuse to pay them the amount of money they want.

I, sometimes can find their articles though by using Google.

I'm not doubting the paperwork issues only wondering why they are issues with this particular law when they are fairly common requirements for other things also.

 
At 9/05/2012 2:08 PM, Blogger bart said...

Ron H. said...

LOL

While anything's possible, I don't generally give Larry that much credit.

...unless you think he is an advocate for some Libertarian group that is hoping to shift public opinion against the collectivist nonsense he blathers about.


I haven't given it much thought on who he might be advocating for, but his posting style and content resembles two folk on another forum who were exposed a year or so ago.

My first "warning" is the very high number of posts, combined with continual posting on a given subject.

Most people give up (even me ;-)(although I do zap folk like PT etc. now & then on obvious stuff that they completely avoid or run & hide from like reverse hedonics or the obviously understated rent picture) after a few posts when they see no effect is occurring.

 
At 9/05/2012 2:10 PM, Blogger Ron H. said...

"But you are not paying taxes for small businesses.

You are exempting them from taxes so they will not be adversely affected.
"

Look: this is pretty simple. I'm completely in favor of everyone paying less taxes and getting fewer government services, but what you are claiming requires that the amount of taxes collected from small businesses isn't needed, therefor they can be exempted and nobody must make up the difference to cover government spending.

That is so obviously *not* the case, that I'm surprised even YOU missed it. So, if small businesses pay less taxes, someone else will pay more.

"What you are doing is helping to provide insurance to employees who then can easily change jobs when a small business fails - and still have their insurance."

The term "helping to provide" means "paying for" Larry.

Besides, HIPAA already allows workers to keep their insurance when they change jobs, so that argument is bogus.

You have several times waved EMTALA around, suggesting that cost shifting caused by those requirement would be eliminated under Obamacare but you haven't provided a dollar amount it represents. Can you do that? What is the amount of cost shifted to others by EMTALA? Please don't just guess or rely on "Larry Logic" for your answer. Real documented estimates please.

Of course Obamacare doesn't repeal EMTALA, so someone not covered by Obamacare - an immigrant maybe - would still be treated under EMTALA requirements and the costs shifted to others.

 
At 9/05/2012 2:11 PM, Blogger Jon Murphy said...

I'm not doubting the paperwork issues only wondering why they are issues with this particular law when they are fairly common requirements for other things also.

The numbers I was quoting was not for this particular low, but the cost for companies to comply to all laws. My point was that these tax credits, so many of them are not high enough to cover the cost of complying with the tax, so the majority of businesses ignore them and bare the full brunt of the new regulatory burden.

 
At 9/05/2012 2:12 PM, Blogger Jon Murphy said...

Jon... no.. I refuse to pay them the amount of money they want.

I figured as much. I just didn't know if your workplace had a subscription or a cousin or anything like that.

 
At 9/05/2012 2:15 PM, Blogger Jon Murphy said...

My ultimate point was that all things have both seen and unseen costs and costs shift behavior. Sometimes, when analysis is done, the unseen costs are ignored, and bad analysis comes from that (by the way, I am not saying you are conducting bad analysis. You clearly are not).

 
At 9/05/2012 2:19 PM, Blogger Ron H. said...

"ya'll don't think Ron Paul supporter are acting collectively?

geeze.

who knew?
"


Zing!!!

 
At 9/05/2012 2:23 PM, Blogger bart said...

Larry G said...

ya'll don't think Ron Paul supporter are acting collectively?



They're not being paid to do so, are they?

 
At 9/05/2012 2:35 PM, Blogger Ron H. said...

"I'm looking for some objective discussions that at least acknowledge that the current system also has regulations and reporting requirements."

Wow. Jon just made the complete and objective comment about the subject I've yet read, but you reject it.

You must be aware that there are no actual dollar figures yet available, as the regs in question haven't yet taken effect. There are only estimates, but business will rely on these estimates to plan their future.

You must be kidding about the subject of current regs and reporting requirements. It really seems too obvious to mention that they exist.

You seem to be disagreeing with other commentators just to be obnoxious. You are waving your gun around pointing at comments you don't like and shouting "Bang Bang" while it's clear you have no real ammunition.

 
At 9/05/2012 2:39 PM, Blogger Ron H. said...

"My first "warning" is the very high number of posts, combined with continual posting on a given subject."

But isn't it necessary to make sense at least once in a while?

 
At 9/05/2012 2:39 PM, Blogger Larry G said...

do you have to be paid to be acting collectively?

:-)

 
At 9/05/2012 2:48 PM, Blogger Larry G said...

re: " Wow. Jon just made the complete and objective comment about the subject I've yet read, but you reject it."

estimates?

let's see them.

this is the problem.

there are assertions and very little data but it constitutes the opposition.

re: high number of posts?

ha ha ha

I'm prolific yes... but I'm a piker compared to Ron and Van ....

On this issue - the costs of ObamaCare - there is little real data and a hell of a lot of propaganda....

and I bet that companies that provide employer-provided health care also have paperwork and "costs" but I don't think I've ever hear the WSJ or others advocate getting rid of employer-provided health care because of the paperwork "costs".

why is that?

you'd think that if their primary concern was the costs that they'd make a consistent argument - a principled argument - instead of a selective, one-sided argument where one kind of health care costs are terrible and another kind - not worth mentioning...

 
At 9/05/2012 2:51 PM, Blogger Ron H. said...

"do you have to be paid to be acting collectively?"

So are you commenting here without pay in hopes of galvanizing libertarian views against the liberal hogwash you go on about?

If so, you are to be commended You are succeeding.

 
At 9/05/2012 2:56 PM, Blogger Jon Murphy said...

On this issue - the costs of ObamaCare - there is little real data and a hell of a lot of propaganda....

Yes, but the majority of the law doesn't go into effect for another year-and-a-half, so the fact that there is little data doesn't really mean much.

But you are right. There are a lot of things being thrown around by both sides. But projections are projections. They are based of a set of assumptions. Only time will tell how this thing really goes.

 
At 9/05/2012 2:57 PM, Blogger Jon Murphy said...

I've said my bit. I'll leave you to alone now.

 
At 9/05/2012 2:57 PM, Blogger bart said...

Ron H. said...

But isn't it necessary to make sense at least once in a while?


He does, at least to some and sometimes, but an astroturfer or someone with vested interests does mostly operate on false premises to which others have bought into.

Bottom line - who knows if he is an astroturfer or similar?... but the general modus operandi sure is familiar to me, especially the intensity and frequency of posting.

He virtually always "hooks" someone too, and it goes on for dozens of posts - another indicator.

 
At 9/05/2012 2:57 PM, Blogger Larry G said...

Oh shit, I was hoping for the opposite!

:-)

 
At 9/05/2012 2:58 PM, Blogger Ron H. said...

"you'd think that if their primary concern was the costs that they'd make a consistent argument - a principled argument - instead of a selective, one-sided argument where one kind of health care costs are terrible and another kind - not worth mentioning..."

Now we will discuss the perceived bias of the WSJ instead of any of the previous subjects, I guess.

Zooom! Oh wow! The high lateral Gs of that sudden direction change nearly made me faint.

 
At 9/05/2012 3:02 PM, Blogger Larry G said...

Thanks Jon. Much appreciate your non-confrontational approach.

 
At 9/05/2012 3:02 PM, Blogger Larry G said...

and with that.. I'll take a break also.

....

 
At 9/05/2012 3:05 PM, Blogger bart said...

Larry said:

On this issue - the costs of ObamaCare - there is little real data and a hell of a lot of propaganda....


Here's a sort of example Ron.

The CBO does have a huge report with lots of facts, but it received virtually zero credence... and whoever heard of a government report whose number$ were too low (except the glowing deficit projections after dot com?).

As an aside, I wonder if the OMB has a projection or report? I tend to trust them more than the CBO.


 
At 9/05/2012 3:12 PM, Blogger Ron H. said...

"He virtually always "hooks" someone too, and it goes on for dozens of posts - another indicator."

Yeah, some of us are pretty easy prey for trolls. :)

I have several reasons for staying hooked:

- I usually have plenty of time.

- I have a low tolerance for BS.

- I enjoy playing Whack-A-Mole. With Larry, you never know what will pop up next, so it's good reflex training.

- I can practice my writing skills.

- It's always possible other readers might benefit.

- Most of all, He's great comic relief.

 
At 9/05/2012 3:15 PM, Blogger Ron H. said...

"As an aside, I wonder if the OMB has a projection or report? I tend to trust them more than the CBO."

Wow. Considering who's baby this healthcare monster is, I'm not sure I would prefer the OMB.

 
At 9/05/2012 3:17 PM, Blogger bart said...

LOL Ron!

I almost used the word troll to describe him, but he's milder than a real troll - at least from my experience.

No worries, just wanted to interject a viewpoint that was bothering me.

 
At 9/05/2012 3:45 PM, Blogger Ron H. said...

"I almost used the word troll to describe him, but he's milder than a real troll - at least from my experience."

Yeah, real trolls don't usually get much red meat here, at least not for long.

If there's one thing Larry is NOT, it's malicious. He just thinks he's doing his part to counterbalance the predominantly conservative and libertarian views presented here.

 
At 9/05/2012 3:53 PM, Blogger Larry G said...

geeze.. a compliment...

gazooks!

 
At 9/05/2012 4:36 PM, Blogger bart said...

Ron H. said...

Yeah, real trolls don't usually get much red meat here, at least not for long.

If there's one thing Larry is NOT, it's malicious. He just thinks he's doing his part to counterbalance the predominantly conservative and libertarian views presented here.


Very much agreed, except about the astroturfing possibility.

 

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