The Affordable Care Act creates a new health insurance marketplace (the exchange). But because of the great uncertainty about what buyers will enter the market and who will buy what product, the law creates three vehicles to reduce insurance company risk.
Politicians and bureaucrats are notorious for manufacturing euphemisms -- clever but deceptive substitutes for what they really mean but don’t want to admit. That’s how the phrase “revenue enhancement” entered the vocabulary. Some of our courageous friends in government couldn’t bring themselves to say “tax hike.”
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Facts are easy. You can check facts. What supporters of the Affordable Care Act are doing, on the other hand, transcends factual bungling. It’s far more advanced: a warping of reality so debauched it looks like something out of a tale by H.P. Lovecraft.
The east coast and parts of the southern U.S. were to varying degrees paralyzed by blizzards a few weeks ago. The snow as expected rendered the roads treacherous, and in anticipation of slick streets, shoppers flocked to the grocery stores in advance.The rush into grocery stores, and its aftermath, offers worthwhile lessons in economics.First up, […]
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Recent difficulties with implementing the Affordable Care Act have increased opposition to the program. A majority of Americans now oppose it. Problems with the HealthCare.gov website are in all likelihood temporary. However, there are serious long-term problems, particularly considering long-term finance and labor supply issues. Given the mounting difficulties with and growing concerns about the […]
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“Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime.”As the inequality gap grows, there is an ideological battle unfolding in the West.On the one hand, there are those who think government can fix things. It must do more, tax more, […]
On Feb. 7 the United States will once again reach its statutory debt limit, meaning it cannot legally borrow any more money. Since the obvious option of cutting spending to match the amount of revenue that the government collects is off the table for some inexplicable reason, Congress will have to pass a new, higher […]
The New York Times published an interminable article on health care recently. Plenty of facts — how scrupulous are these journalists! — but the article displayed absolutely no comprehension of the basics of cause and effect. I was left wondering about the whole point.The article details how the health care system rewards specialists to an […]
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We’d like to give the banks in Australia some credit. They’ve finally gone and done it. They have caught up with 1960s technology. They’ve figured out how to use PIN numbers.How to only use PIN numbers, that is. They’re considering scrapping signatures on credit cards to cut down on fraud. Apparently, having to verify your […]
We put in a good-citizen call to the SEC the other day.“There’s a massive scheme to manipulate stock prices,” we told the friendly agent.“I have to tell you that your call is being monitored so that we can better serve the public,” he replied.“Oh, don’t worry about that. The NSA is tapping our call anyway.”“Are […]
Dr. William C. Padgett is a retired optometrist who has been trying to bring an elderly care facility to Beaufort County, North Carolina, for over a decade.“Our senior citizens,” he laments, “are finding that it is difficult and in many cases impossible to find an appropriate long-term care facility locally.” Though he has received several […]
If you don’t have the angst out of your system concerning Wall Street banksters, Government Sachs, and the Affordable Care Act, settle in with Matt Taibbi’s Griftopia to make your blood boil one more time.Investors should be reminded of 2008 as they shrug their shoulders and put their money back in the stock market. The […]
What do 8 of the 10 wealthiest people in the U.S. have in common?Aside from being able to fly in private jets, the common thread is that each of them has made their fortune thanks to a start-up.Let me explain…From tech titans like Bill Gates and Larry Ellison (founders of Microsoft and Oracle, respectively), to […]
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In December of last year, I left my career to travel the world for one year.My plan was to visit as many countries as possible on my Star Alliance Around-the-World ticket in the first nine months, then, for the remaining three months, return back to the country that most caught my eye and my curiosity.Nine […]
Economic history is primed to repeat in the nastiest of ways unless the government stops distorting the price of something we use every day.Every product, good, or service has a price, which is essential to rational decision-making. We use prices every day as vital data that guide us. Without true prices, prices not distorted by […]
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Uh-oh!The new pope, Francis from the Pampas, has just warned us to beware the “tyranny” of capitalism.Each man worships his own gods. Some worship at the altar of Jesus of Nazareth. Some at the altar of the Almighty Dollar. The capitalists don’t bad-mouth Francis’ god. You’d think he would cut them the same slack.Bad-mouthing Catholicism […]
The market has selected different things as money throughout history. Some of these items have served as money in isolated places for specific periods of time — for instance, cigarettes in prisoner-of-war camps. Cigarettes continue to be a currency in prisons if allowed, but if not, according to Wikipedia, “postage stamps have become a more […]
A president stands disgraced. Congress is scattering. Bureaucrats are baffled. Pundits are reaching. Industry is scared. Politicians are scrambling to do something, anything, to make it better. One political party is in meltdown and the other loving every minute of it, hoping to ride the calamity to electoral gains.The so-called Patient Protection and Affordable Care […]
The new pope, Francis from the Pampas, has just warned us to beware the “tyranny” of capitalism.
Each man worships his own gods. Some worship at the altar of Jesus of Nazareth. Some at the altar of the Almighty Dollar. The capitalists don’t bad-mouth Francis’ god. You’d think he would cut them the same slack.
Bad-mouthing Catholicism will win you few fans. Those outside the Roman faith won’t care. And papists will be your enemies for life.
But bad-mouthing capitalism has a large, ready audience of uncritical fans.
So we rise to defend the faith — in capitalism, that is.
In this, we take the high road… not because we are high-minded, but merely because we don’t like crowds.
So we will not stoop to criticizing Francis’ faith or praising Mammon with hearty hallelujahs. Instead, we will explore the discreet charm of honest money-grubbing… confident that at least in the land of free-enterprise defenders, we will always find a parking place.
Almost nobody approves of capitalism these days, least of all the SOB cronies on Wall Street who call themselves capitalists.
They preach the gospel of risk-taking. But as soon as the risks go against them in a big way, they call their friends in high government places for succor. They publicly support free enterprise. But privately, they connive with regulators for bailouts, subsidies, and barriers to entry to keep out competitors.
In the crisis of 2008-09, for example, the financial industry reached a major turning point. It should have made the turn. Instead, it kept going in the same direction.
What should have happened, as told by David Stockman in his new book, The Great Deformation:
“Hundreds of billions of long-term debt and equity capital that underpinned the Wall Street-based speculation machines would have been wiped out, including huge amounts of stock owned by executives and insiders. Such a result would have been truly constructive from a societal vantage point. It would have implanted an abiding 1930s-style generational lesson about the deadly dangers of leveraged speculations.”
Instead, the speculations paid off! And the now the big banks are bigger than ever. This week, The Wall Street Journal reported that “too big to fail” banks are pushing the little guys out of existence:
“The decline in bank numbers, from a peak of more than 18,000, has come almost entirely in the form of exits by banks with less than $100 million in assets, with the bulk occurring between 1984-2011. More than 10,000 banks left the industry during that period as a result of mergers, consolidations, or failures, FDIC data show. About 17% of the banks collapsed.”
Yes, dear reader, the big banks hate capitalism too. What they like is crony capitalism. At least they like it when their own cronies are in the Department of the Treasury and the Fed.
A Bum Creed?
The rest of the heaving masses hate capitalism too, but for other reasons. They are envious of those who have more than they have… and eager to redistribute other people’s money — to themselves, of course.
So almost no matter in which direction the pope heaves his message — to the modest nests of the have-nots or the sumptuous pads of the haves — he is bound to hit a supporter.
It’s true, as we have explained, that capitalism is easily corrupted by the capitalists. But that doesn’t mean it is a bum creed. People calling themselves Christians have done vile and repulsive things; that doesn’t mean that “love thy neighbor” is not a worthy aspiration.
Like Christianity, capitalism is a goal, not a fact.
“But that is the same argument the communists made after the Berlin Wall came down,” countered No. 2 son, Jules, when we put this to him.
“They said that you can’t condemn communism just because the Soviet Union was a rathole. They said communism too was a goal… one that had been unrealized by the Russians.”
Our response was simple enough:
“Yes… but there are worthy creeds and unworthy ones. ‘Do unto others as you would have them do unto you’ is still the best way for a civilized community to get along. The more you depart from it, the worse off you are.
“Capitalism works the same way. The further you get away from truly free enterprise the more cronies and zombies (people who live at others’ expense) you get… and the less well the whole system works.
“Envy is a fact of life. You can’t eliminate it. But it has different results depending on what kind of a system you have. Trying to keep up with the Joneses in a capitalist society drives people to work harder and invent things, and helps everyone be better off.
“In a crony capitalist society, envy leads people to take advantage of the system. But it doesn’t stop everyone else from working hard and inventing things… not completely.
“On the other hand, the closer you get to a true state-backed command economy, the closer you get to North Korea!
“Some goals you want to work toward. Others you want to work hard to stay away from.”
Someone should tell Pope Francis.
This article originally appeared here.