Now that the Healthcare bill has become law, we are finally getting some of the transparency we had hoped for during the debates. Unfortunately, this transparency came too late to be of any use during the legislative process and the news is devastating. Despite the promises of budget neutrality made by the President and the Congressional Democrats, this neutrality is turning out to be a shameless and cruel hoax. While the President points to the Congressional Budget Office (CBO) report that claims the bill will provide deficit reduction of just over $100 billion dollars in the first ten years and $1.2 trillion dollars in the second ten years, those numbers were intentionally manipulated by the Democratic leadership.
The CBO can only score what it is before them. It can not extrapolate based on intent and it cannot adjust even when it knows key provisions have been left out of the materials they have been given. The $500 billion that this bill cuts from Medicare was factored in as a savings measure to provide solvency for Medicare through 2019. One would think that if it were a savings measure, that the money would remain in Medicare to restore balance to the program considering the projected rate of expansion. No; instead that $500 billion was also scored as part of the funding for a new entitlement program in the healthcare bill to provide subsidies for the purchase of healthcare insurance for low income families. Counting the same money twice in a business plan or as a proposal to investors would be a crime unless that plan or proposal is being submitted by Congress to the CBO for analysis.
The CBO must also score the bill based upon the language contained in the bill and must assume the cuts proposed in the bill will be law and will take place. Historically, the Congress has already passed cuts to Medicare in many previous years and to date, none of those cuts have ever been enacted. The CBO would love to say “Are you kidding? You guys have never made Medicare cuts before so why should we believe you will now?” The sad truth is they are prohibited from adding anything to their analysis that isn’t part of the actual language before them; including the intent and historical spinelessness of Congress.
Since the $278 billion dollar “doctor fix” was also removed from the legislation and will be considered as part of a spending package separate and apart from the Healthcare Bill, the CBO was prohibited from considering the budget implications from that as well. So far, a cursory look at the fiscal manipulation Democrats used to conceal the true cost of this bill adds up to three-quarters of a trillion dollars and that is just the beginning. It doesn’t sound like that $100 billion dollar savings in the first year is all it’s cracked up to be. As far as the $1.2 trillion dollar savings the CBO estimated for the second ten years is concerned, that is equally as fictional. What the President left out in his speech to the nation was the side note the CBO gave him on their estimates for year eleven through twenty of the program. The CBO made sure they cautioned that the estimates they provided are unreliable beyond ten years and that the projected savings can only be realized if the assumptions made by Congress in the legislation remain valid.
This is only the tip of the iceberg. Large portions of the uninsured are going to be driven into the expanded Medicaid program; a program that bears little consequence for the Federal government but can spell disaster for the individual States. It is very easy for Congressional Democrats to claim budget neutrality when they can shift 70% of this new burden onto the States and let them worry about how to deal with it. Many of these States are already struggling with budget problems of their own because of the recession and loss of tax revenue. In short, while Congressional Democrats try to sell the illusion of budget neutrality and the benefits of the healthcare bill before the November election, the States are going to have to raise your taxes, cut your services or both just to avoid bankruptcy because of the new unfunded mandates in the bill.
Many of the States realize they are already at the tax saturation point and will find it exceedingly difficult to raise taxes to offset the increased Medicaid liability without driving their real tax payers out. States like New York, New Jersey and California have already seen an exodus of the highest earners in recent years and when the affluent in these areas have finally had enough, they aren’t moving to neighboring States for a measly one or two percent decrease in taxes; they are moving to one of the seven US States that have no personal income tax which should be a lesson for us all. As world markets decline, investors are going to look for the safest place to put their money and many would prefer the security and stability of the United States. Unfortunately, the wild spending and outrageous taxes have taken us out of the running and nervous investors would rather take a chance on China’s experiment with limited Capitalism than America’s incredibly stupid experiment with Socialism.
As Federal policy drives the States closer to the brink of disaster, many are beginning to fight back. Several have passed legislation negating the individual mandate that would force citizens to purchase healthcare insurance under the new Healthcare bill and more than twenty more have identical legislation pending. Of course that legislation does not exempt the citizens and businesses in those States from the new tax liabilities so it in fact, allows people the privilege of paying more for absolutely nothing in return.
Congressional Democrats are already kicking back stating that the Supremacy Clause in the Constitution invalidates those measures reminding those States that Federal law supersedes State law. Of course the Supremacy Clause only applies to Federal law that is actually constitutional and that is where several States are applying their attention. Within minutes of the signing of the Healthcare Bill into law, a number of States filed suits challenging the constitutionality of the mandates that force individuals to purchase healthcare insurance and the unfunded mandates the States will face as the number of people enrolled in Medicaid climbs as a result of the bill.
Tomorrow, we will discuss the constitutional questions surrounding the Healthcare Bill and why Congress and the President are secretly concerned about those challenges.
Paul
The CBO can only score what it is before them. It can not extrapolate based on intent and it cannot adjust even when it knows key provisions have been left out of the materials they have been given. The $500 billion that this bill cuts from Medicare was factored in as a savings measure to provide solvency for Medicare through 2019. One would think that if it were a savings measure, that the money would remain in Medicare to restore balance to the program considering the projected rate of expansion. No; instead that $500 billion was also scored as part of the funding for a new entitlement program in the healthcare bill to provide subsidies for the purchase of healthcare insurance for low income families. Counting the same money twice in a business plan or as a proposal to investors would be a crime unless that plan or proposal is being submitted by Congress to the CBO for analysis.
The CBO must also score the bill based upon the language contained in the bill and must assume the cuts proposed in the bill will be law and will take place. Historically, the Congress has already passed cuts to Medicare in many previous years and to date, none of those cuts have ever been enacted. The CBO would love to say “Are you kidding? You guys have never made Medicare cuts before so why should we believe you will now?” The sad truth is they are prohibited from adding anything to their analysis that isn’t part of the actual language before them; including the intent and historical spinelessness of Congress.
Since the $278 billion dollar “doctor fix” was also removed from the legislation and will be considered as part of a spending package separate and apart from the Healthcare Bill, the CBO was prohibited from considering the budget implications from that as well. So far, a cursory look at the fiscal manipulation Democrats used to conceal the true cost of this bill adds up to three-quarters of a trillion dollars and that is just the beginning. It doesn’t sound like that $100 billion dollar savings in the first year is all it’s cracked up to be. As far as the $1.2 trillion dollar savings the CBO estimated for the second ten years is concerned, that is equally as fictional. What the President left out in his speech to the nation was the side note the CBO gave him on their estimates for year eleven through twenty of the program. The CBO made sure they cautioned that the estimates they provided are unreliable beyond ten years and that the projected savings can only be realized if the assumptions made by Congress in the legislation remain valid.
This is only the tip of the iceberg. Large portions of the uninsured are going to be driven into the expanded Medicaid program; a program that bears little consequence for the Federal government but can spell disaster for the individual States. It is very easy for Congressional Democrats to claim budget neutrality when they can shift 70% of this new burden onto the States and let them worry about how to deal with it. Many of these States are already struggling with budget problems of their own because of the recession and loss of tax revenue. In short, while Congressional Democrats try to sell the illusion of budget neutrality and the benefits of the healthcare bill before the November election, the States are going to have to raise your taxes, cut your services or both just to avoid bankruptcy because of the new unfunded mandates in the bill.
Many of the States realize they are already at the tax saturation point and will find it exceedingly difficult to raise taxes to offset the increased Medicaid liability without driving their real tax payers out. States like New York, New Jersey and California have already seen an exodus of the highest earners in recent years and when the affluent in these areas have finally had enough, they aren’t moving to neighboring States for a measly one or two percent decrease in taxes; they are moving to one of the seven US States that have no personal income tax which should be a lesson for us all. As world markets decline, investors are going to look for the safest place to put their money and many would prefer the security and stability of the United States. Unfortunately, the wild spending and outrageous taxes have taken us out of the running and nervous investors would rather take a chance on China’s experiment with limited Capitalism than America’s incredibly stupid experiment with Socialism.
As Federal policy drives the States closer to the brink of disaster, many are beginning to fight back. Several have passed legislation negating the individual mandate that would force citizens to purchase healthcare insurance under the new Healthcare bill and more than twenty more have identical legislation pending. Of course that legislation does not exempt the citizens and businesses in those States from the new tax liabilities so it in fact, allows people the privilege of paying more for absolutely nothing in return.
Congressional Democrats are already kicking back stating that the Supremacy Clause in the Constitution invalidates those measures reminding those States that Federal law supersedes State law. Of course the Supremacy Clause only applies to Federal law that is actually constitutional and that is where several States are applying their attention. Within minutes of the signing of the Healthcare Bill into law, a number of States filed suits challenging the constitutionality of the mandates that force individuals to purchase healthcare insurance and the unfunded mandates the States will face as the number of people enrolled in Medicaid climbs as a result of the bill.
Tomorrow, we will discuss the constitutional questions surrounding the Healthcare Bill and why Congress and the President are secretly concerned about those challenges.
Paul
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