How Washington Rations

Today’s article of the day is from the Wall Street Journal:

Try to follow this logic: Last week the Medicare trustees reported that the program has an “unfunded liability” of nearly $38 trillion — which is the amount of benefits promised but not covered by taxes over the next 75 years. So Democrats have decided that the way to close this gap is to create a new “universal” health insurance entitlement for the middle class.

Such thinking may be a non sequitur, but it will have drastic effects on the health care of all Americans — and as it happens, this future is playing out in miniature in Medicare right now. Desperate to prevent medical costs from engulfing the federal budget, the program’s central planners decided last week to deny payment for a new version of one of life’s most unpleasant routine procedures, the colonoscopy. This is a preview of how health care will be rationed when Democrats get their way.

At issue are “virtual colonoscopies,” or CT scans of the abdomen. Colon cancer is the second leading cause of U.S. cancer death but one of the most preventable. Found early, the cure rate is 93%, but only 8% at later stages. Virtual colonoscopies are likely to boost screenings because they are quicker, more comfortable and significantly cheaper than the standard “optical” procedure, which involves anesthesia and threading an endoscope through the lower intestine.

[How Washington Rations]

Virtual colonoscopies are endorsed by the American Cancer Society and covered by a growing number of private insurers including Cigna and UnitedHealthcare. The problem for Medicare is that if cancerous lesions are found using a scan, then patients must follow up with a traditional colonoscopy anyway. Costs would be lower if everyone simply took the invasive route, where doctors can remove polyps on the spot. As Medicare noted in its ruling, “If there is a relatively high referral rate [for traditional colonoscopy], the utility of an intermediate test such as CT colonography is limited.” In other words, duplication would be too pricey.

This is precisely the sort of complexity that the Democrats would prefer to ignore as they try to restructure health care. Led by budget chief Peter Orszag, the White House believes that comparative effectiveness research, which examines clinical evidence to determine what “works best,” will let them cut wasteful or ineffective treatments and thus contain health spending.

The problem is that what “works best” isn’t the same for everyone. While not painless or risk free, virtual colonoscopy might be better for some patients — especially among seniors who are infirm or because the presence of other diseases puts them at risk for complications. Ideally doctors would decide with their patients. But Medicare instead made the hard-and-fast choice that it was cheaper to cut it off for all beneficiaries. If some patients are worse off, well, too bad.

Medicare is already the country’s largest purchaser of health care. Private carriers generally adopt its rates and policies, and the virtual colonoscopy decision may run this technology out of the marketplace. Now multiply that by the new “public option” that Democrats favor, which would transfer millions of patients to a new insurance program managed by the federal government. Washington’s utilitarian judgments about costs would reshape the practice of medicine.

Initially, the open-ended style of American care will barely be touched, if only for political self-preservation. Health planners will adjust at the margins, as with virtual colonoscopy. But scarcity forces choices. As the Medicare trustees note in their report, the tax increases necessary to fund merely the current benefit schedule for the elderly would cripple the economy. The far more expensive public option will not turn into a pumpkin when cost savings do not materialize. At that point, government will clamp down with price controls in the form of lines and rock-bottom reimbursement rates.

Mr. Orszag says that a federal health board will make these Solomonic decisions, which is only true until the lobbies get to Congress and the White House. With virtual colonoscopy, radiologists and gastroenterologists are feuding over which group should get paid for colon cancer screening. Companies like General Electric and Seimens that make CT technology are pressuring Medicare administrators too. More than 50 Congressmen are demanding that the decision be overturned.

All this is merely a preview of the life-and-death decisions that will be determined by politics once government finances substantially more health care than the 46% it already does. Anyone who buys Democratic claims about “choice” and “affordability” will be in for a very rude awakening.

Published in: on May 19, 2009 at 6:40 pm  Leave a Comment  
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We may need Cuba’s Old Cars

wright

~PCCapitalist

Published in: on April 24, 2009 at 12:36 pm  Comments (1)  
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Think first, recycle second by Anonymous

Today’s article of the day comes from yesterday’s Union Leader in New Hampshire on Earth Day:

Today is Earth Day, the fake holiday on which the government attempts to guilt us into “saving the planet.” This year the guilt trip is more tedious because President Obama has made it his mission to change our energy consumption habits by force of law.

Of course, wasting energy is a dumb idea. It’s not dumb because it’s somehow harmful to Mother Nature, but because leaving the light on in the living room when you are eating dinner in the dining room wastes money. And recycling is good (as long as it’s more cost-effective than dumping) for the same reason. Throwing away something that has cash value is the same as throwing away money.

That said, Earth Day takes these common-sense behaviors to absurd levels. Reducing, reusing and recycling really are about economics, not morality. If we use more energy to recycle something than to make a new one, we’ve done more harm than good. If we install “environmentally friendly” toilets that use less water, only to have to flush twice, thus using more water, we’ve done more harm than good.

So when President Obama says we have to pay hundreds of billions of dollars to reduce carbon emissions right away, the correct response is to ask whether it is cost-effective. Burning fossil fuels emits only 3.27 percent of atmospheric carbon dioxide, according to a report by Drew Thornley of the Manhattan Institute. Is the payoff really worth the price?

Every transaction involves tradeoffs. Environmental policy is not exempt from that rule. Before cheering for certain policies just because politicians call them “green,” stop to make sure the benefits are worth the cost. Otherwise, you might hurt the environment instead of help it.

Published in: on April 23, 2009 at 6:18 pm  Comments (1)  
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Tea Party Crasher

beeler

~PCCapitalist

A Word on Today’s Tea Parties

Today many people around the country will get together for a unified cause. This cause was voiced on the Chicago Exchange floor by Rick Santelli. He said what everybody had been thinking at the time, that we are fed up with the spending of government and it needs to stop. We all realize that Obama is going to raise taxes, print money, and/or create debt. None of these are good, especially considering it is always in the interest of the politician to do the last two.

It is true that in early Constitutional America there were a few tax revolts for taxes that were much smaller than the ones we are complaining about today. It is true that Americans have gotten used to the way their government is. But it takes more than just getting mad once to change the way our government is run. We need to win the intellectual battle, so I challenge you to read people like Adam Smith, F.A. Hayek, Ludwig von Mises, and many others. This way we as a society can further the belief in liberty to our children and so on.

Let us not forget today and continue with this on tomorrow. Let us not delude ourselves to think that any politician will save our hard-earned money. Instead let us wake from our apathy and realize that our government is set up in a way in which politicians stay in power by spreading the costs and concentrating the benefits. This is why every district hates Congress but loves their Congressman or woman.

We have to remember where we have stepped into a world where not littering and being political correct has been placed higher than liberty. The Boston Tea Party was one where white males dressed up as Indians and threw tea into the water. Today none of you will even think about doing that because of the consequences. I am not saying do those things but I just want all the supports of these tea parties to realize exactly where we are today.

Today is important but always be thinking about tomorrow!

~PCCapitalist

One more step in the right direction: Cuba

Even though it was a Democrat (Kennedy) who put in the Cuban Embargo Act, it has been a Republican supported issue. The embargo is not gone but President Obama has taken a step into the right direction. He has lifted restrictions of travel. This from the Financial Times:

“President Barack Obama on Monday took a big step towards relaxing sanctions on Cuba, lifting all travel and remittance restrictions on Cuban-Americans and permitting US telecoms companies to offer services directly to the island.

The end of the restrictions, which Mr Obama promised during his campaign, means Cuban-Americans will be able to travel to the island state when they like, as opposed to once a year, and send as much money as they want to relatives, as opposed to $75 a month. Mr Obama also said he would permit Cuban-Americans to pay for US-provided telecoms services to relatives living in Cuba.

“Clearly, the Obama administration is re-examining US policy towards Cuba,” said Peter DeSchavo, analyst at the Centre for Strategic International Studies. “It would be an understatement to say that the embargo has not achieved what it was supposed to achieve.”

It is good that we are finally recognizing that it is free trade and not embargos that actually further freedom and liberty. Trade restrictions have done nothing but give Castro a reason to blame us for their economic woes. This blog hopes that even though Obama believes that Socialism is the best course for us that he will recognize trade is the best course for them (to become less socialist).

The rest is here.

~PCCapitalist

Deliberately Misplaced Blame by Sean Malone

The article of the day comes from Mises.org:

Let’s play a game. I have a not-so-famous quotation to share with you, and then you guess who said it:

We might have done nothing. That would have been utter ruin. Instead we met the situation with proposals to private business and to Congress of the most gigantic program of economic defense and counterattack ever evolved in the history of the Republic.

I’ll give you a hint; it was spoken by a sitting US president. Not quite enough? How about multiple-choice? Was the speaker

  1. Current president Barack Obama
  2. Overseer of the first-round, $700 billion bailout George W. Bush
  3. New Deal designer Franklin Delano Roosevelt
  4. “Hands-off” free-market supporter Herbert Hoover

Ponder that for a minute or two, and we’ll come back to the answer later on.

Geesh! Free-market, laissez-faire capitalism sure has been taking a beating in the press lately. The official story seems to be that everyone knows the financial crisis represents a failure of the capitalist system, and now only a “gigantic program of economic defense” will save us.

I suppose that would make plenty of sense, if only the details we’re being told day in and day out were actually true.

It’s rather amazing the lengths to which many of the people chronicling the economic crisis are willing to stretch the truth in order to ascribe blame to those they wish to be responsible, all the while ignoring those who actually are. One depressingly common tactic, seemingly en vogue at the moment, is to falsely claim that a person said or believed certain wrong-headed things in order to denigrate the person about whom one is making the claim. Examples abound, but the case du jour is Thom Hartmann’s traducement of laissez-faire’s “intellectual roots” in the Huffington Post:

The intellectual forefathers and mothers of the insane conservative economic policies that have brought us to where we are include Ludwig Von Mises, Friedrich Von Hayeck [sic], Milton Friedman, Alan Greenspan, Tom Freidman [sic], Robert Rubin, Larry Summers, and Ayn Rand.

Hartmann will likely get away with this slap-dash conflation of names, simply because the people he impugns are mostly dead and relatively unknown to the average reader. Hartmann isn’t alone either; it seems almost daily we read another set of distortions, myths, and outright lies trotted out by similarly minded writers.

The reality, quite unfortunately for Mr. Hartmann and friends, is that his claim is built on a wobbly foundation of misinformation. Why? (more…)

Is Barack Obama The “Moral Alternative” To Capitalism? by Austin Hill

The Article of the Day comes from Townhall.com:

Who ever imagined that in the year 2009, the President of the United States and the protesters who sought to disrupt the G-20 Summit would actually agree on something?

“Capitalism is immoral” was one of the phrases scrawled on several of the banners carried outside the summit meetings this past week. And although he has never said this in so many words, indeed President Obama would seem to be in lock-step with that assertion, or at least with the sentiment that the assertion entails.

But whether you’re a protester or the President, to assert (or even to simply “imply,” as Mr. Obama does) that “capitalism is immoral” is to invite a slew of crucial questions. And the first and most obvious question that this raises is, “what does this assertion mean?”

Presumably, protesters – – and those who think and believe like them – – intend to convey with their “capitalism is immoral” statement that the mechanisms of the free market have failed to produce “moral” economic outcomes. Executives earn too much money, non-executives earn too little. Business owners exploit their employees, and as a result the employees can never “get ahead” and gain new ground with their personal finances.

And it’s not just protesters outside the G20 Summit who believe these things. I suspect that a great many Americans think and believe that the free market has produced “immoral” outcomes, as well. But it is not sufficient to simply say “the free market is immoral.” If one really believes this, then one must ask themselves “what system would make for a better alternative?” Yet without formally asking this question about “alternatives,” most people who believe that the free market is immoral presume, almost instinctively, that an economic system with more government controls and mandates can produce a more “moral” outcome.

So let’s assume for a moment that this is true, that more government controls and mandates on business can produce a more “moral” outcome for the economy, and for the broader society. If this is so, then one must also answer this question: who is the individual person that is so wise, so all-knowing, so just and so good, that they can make all the decisions necessary to produce this “more moral” economy?

Don’t kid yourself – – this is high-stakes stuff. If the mechanisms of the free market – – that is, private persons and organizations who, driven by their own natural interests, seek to acquire the best possible goods and services at the lowest possible prices, and who seek to sell their goods and services for the highest price they can get for them – – if the decisions and behaviors of individual private citizens don’t produce a desirable outcome, then which individual can make all the “right” decisions, and mandate all the “right” behaviors, so we can all enjoy a desirable outcome?

People of the “protester mentality” don’t often consider these more detailed, more delicate, and more difficult questions. Yet, world history is replete with kings, queens, dictators, and – – yes – – even Prime Ministers and Presidents – – who are certain in their own minds that “as long as I’m making all the decisions, then things will turn out good.”

This is precisely the certainty that President Obama displays. In the past three weeks, alone, our President used his influence to oust the C.E.O. of the General Motors Corporation, and now appears to be more-less hand-picking a new board of directors for G.M. As was noted in a Washington Times article two weeks ago, Mr. Obama’s Treasury Department appears to be creating a new position in our government – – the office of the “U.S. Executive Compensation Specialist” – – a government appointee who will determine how much money business managers and executives will be “permitted” to earn, and who will also seek to take away earnings from Americans who are believed to have been paid “too much.” It also appears that, via the Treasury Department, Mr. Obama intends to have other CEO’s removed and replaced as well.

So is this the pathway to a “more moral” U.S. economy? Nobody questions that there have been serious failures among many American corporations. But does this one man, Barack Obama, know the banking, and insurance, and automotive, and healthcare, and energy businesses so well that he, alone, can determine what are “fair” wages, and prices, and practices in all situations.

Such an assumption of the U.S. President defies the limitations of the executive office as set forth in the U.S. Constitution. But constitutional limits don’t seem to matter to our current President.

So now it is left to the American citizenry and the U.S. Congress to determine if this one man, Barack Obama , is so wise, so all-knowing, so just and so good, that he can make all the decisions necessary to produce this “more moral” economy. How will the American people respond to this all-important question?

Two-faced Obama

cagle00

~PCCapitalist

Published in: on April 4, 2009 at 1:52 pm  Leave a Comment  
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Terence Corcoran: Is this the end of America?

The article of the day comes from The Financial Post:

U.S. law-making is riddled with slapdash, incompetence and gamesmanship

By Terence Corcoran

Helicopter Ben Bernanke’s Federal Reserve is dropping trillions of fresh paper dollars on the world economy, the President of the United States is cracking jokes on late night comedy shows, his energy minister is threatening a trade war over carbon emissions, his treasury secretary is dithering over a banking reform program amid rising concerns over his competence and a monumentally dysfunctional U.S. Congress is launching another public jihad against corporations and bankers.

As an aghast world — from China to Chicago and Chihuahua — watches, the circus-like U.S. political system seems to be declining into near chaos. Through it all, stock and financial markets are paralyzed. The more the policy regime does, the worse the outlook gets. The multi-ringed spectacle raises a disturbing question in many minds: Is this the end of America?

Probably not, if only because there are good reasons for optimism. (more…)