Tax the rich

Bernie Sanders the only avowed socialist in the United State Senate was on TV echoing The Presidents call for a more equal distribution of income and he suggested higher taxes on the rich. I have to believe that both of these gentlemen understand that this will not work because there are too few rich and too many not rich. In 2010 the 1.35 million taxpayers who represented the top one percent earned 19% of the total gross income and paid 37% of all federal income tax which means they paid in 354 billion dollars in taxes. If we double their taxes and collect another 354 billion and distribute that to the remaining 99% they would each receive $3,000. This is not a very effective way to help the 99 percenters. A much better solution is to grow the economy and a proven way to do that, is free market capitalism and a good starting point, is the energy sector and specifically start using natural gas for power plants, and change over to natural gas in transportation. This is all shovel ready stuff and is underway in certain areas. I don’t understand what we are waiting for!

AIG bailout

AIG the large insurance company that had to be bailed out by the taxpayers is running ads on TV toting the fact that they paid back the bailout money. These are people who purchased high risk mortgage backed bonds and lost the bet. The bonds turned out to be junk and this company filled with investment experts lost their shirts. The government stepped in and purchased 95% of the company and allowed them time to restructure their company and then over time they bought back their stock from the government. Today they are bragging about their come back. Was anyone punished for this risking behavior? Quite to the contrary they were rewarded. American International Group is set to pay $450 million of bonuses to employees of the unit that was largely responsible for the New York insurer's near collapse last fall. Here is how our watch dogs in the congress responded. Rep. Elijah Cummings plans to send a letter Monday to Treasury Secretary Tim Geithner expressing his "outrage" that insurance giant AIG, the recipient of more than $170 billion in government aid, will dole out $165 million in corporate payments this week as part of its $1 billion retention program to keep senior executives at the company. They sent a nasty letter and that was the end of it. Congressional oversight committee members did not see the threat coming and when it was exposed they sent a letter and that was it. No one at AIG was ever punished. This is what many citizens see as corruption and this is what most upsets people but they re-elect these people year after year.

Calling

Here is something I sent to a young person who asked me what they should do with their life. As your children reach the right age they may find this helpful. When discussing the kind of work people do, most of us understand what is meant by a job, a career and a profession but a calling is something most do not give much thought to. The words themselves are somewhat interchangeable but in my way of thinking they are distinctly different. To me a job is something you get without much preparation and you can change jobs frequently and not suffer any adverse consequences. A career on the other hand requires some commitment beyond being there from 9 to 5. A career is recognizable to others and normally requires some degree of expertise. A profession means you are a professional. This usually means a lot of time and effort directed at a very narrow course of action. Professionals make a career out of their job. Professionals are highly skilled either by formal training or natural ability. Calling is in a class by itself and not many are called or more precisely not many recognize their calling. Biblically Mathew in the New Testament says, “many are called but few are chosen”, which to me means that we may all have a calling but only a few of us recognize it and even fewer follow up on it. A calling sometimes comes from the inside out and that happens early in life. Other times it comes from the outside in and that can happen at any stage in life. Most of us are familiar with people who have a calling from within. Many people miss their calling because they are tied up just with making enough to support their families. Many pass by opportunities because of a fear to take a financial risk. Many do not think they are worthy……no one in our family ever does anything important. A man can have a good life, meaning he has a job that provides for his family, he enjoys going to work and feels like he is making a difference and that satisfies him. Sometimes a man in that position gets to midlife and realizes that something is missing. If he looks into it he might discover a part of himself he did not know existed and upon further study can come to understand that there is something more important in his future. Such a man will seemingly stumble into his calling. Since he has searched and studied, this it is more than a stumble, it is an example of serendipity Money is rarely the clue to someone’s calling….more often it is a desire to share ones talents, experience, and knowledge in ways that can be helpful to others. It has little to do with fame and fortune. In answer to your question, we are all born selfish and as we go through life we should reach the point where we realize that happiness comes from giving. I would say that a man recognizes his calling when he realizes that the secret to happiness, is in giving. It does not matter what method (type of work) he uses to share what he has but it is in the sharing that he begins to use his calling.

Read my lips

When the first George Bush was running for president in 1987 he said, “Read my lips, no new taxes”, and then after he was elected in 1990 he agreed to raise taxes. He was defeated in his re-election for 1994, almost four years after the tax increase and seven years after his pledge. Looking back many analyst feel the breaking of his pledge cost him the second term. Now we have the case of Hillary Clinton who made the now infamous statement about those who died in Benghazi saying, “what difference does it make how they died”, and some say it will cost her the election in 2016 only 4 years after she made the remarks. Others say it will all be forgotten in 4 years and I believe they are correct because even in this short time the public attention span has gotten so much shorter.

cost

When congress passed Obamacare the estimated cost for the first ten years was 900 billion since he said he wanted to keep the cost under a trillion. The latest ten year cost projection is 2.6 trillion. Now we find out that there is a clause in the act stating that if the insurance companies lose money the government will reimburse them. This will happen if not enough young healthy people sign up to offset the cost of the previously uninsured who are quickly signing up. We have seen many times over The President saying that if you like your insurance you can keep it and how this was not the case but we have yet to see his statement that this plan will not add one dime to the deficit. That will probably be on our screens this coming year.

Gas

A common question regarding the price of gasoline is why is the price still over $3 when we are producing so much more oil and the answer is that the price of oil is set on the world market. The increase in production here in the US has been offset by an increase in demand in the rest of the world. If we had not increased our output through fracking the price would be much higher. The easiest way to lower the price of gas is to have a substitute fuel such as natural gas. If we converter all semi-trucks to natural gas we would eliminate our need for Saudi oil and the price would come down. It requires the instillation of natural gas pumps at all truck stops. The cost of all of this would be less than what the government has wasted on wind and solar experiments that have gone bankrupt. In spite of this the march toward natural gas is inexorable because of free market forces. The changes are already underway as we move from coal power plants to natural gas and semis will follow.

Unemployment

A bill is being introduced to extend unemployment benefits and it will be paid for by calling it a national emergency and the cost will be added to the deficit. That is a great idea. Now why not add to that the millions who are homeless and all those who don’t have enough to eat. I have a plan to pay for these new programs. Just ask the big banks to pay. The government has given them two trillion (with a T) over the past four years and they are just sitting on it as excess reserves. Here is their chance to be good citizens.

Insurance bailout

When Obamacare was first proposed The President wanted the cost for the first ten years to be under one billion and that was the task assigned to the developers in the senate. To meet that goal the plan was started in 2010 but most of the benefits and therefor the cost didn’t start until 2014. By the start of 2013 the new cost estimates were over 2 billion and now they are up to 2.5 billion. People wondered why the insurance companies were in favor of Obamacare and the answer given was that it would supply them with 30 million new customers who would be forced to buy insurance. What wasn’t known was a clause in the law that said if the insurance companies lost money because too many old and uninsured signed up and too few young health people signed up, the government would step in with a bailout. At this point it looks as though that might happen and this will add more cost to the already over budget plan.

Tolerance

Now that Phil Robertson from Duck Dynasty is in the headlines I am reminded of my travels through the world of tolerance. When I was young I was tolerant of just about everybody. If someone made a comment about another person I would jump to their defense by saying if you had walked in their shoes you might think differently. My favorite line to defend some big city delinquent was if your mother was a prostitute and you father a druggie where would you be. I got so good at this that by the time I hit 30, I reached the point where no one was responsible for anything. As years past I came to understand that this was an unattainable position and slowly changed and started evaluating each situation on its merits and today I have a warning for younger folks. Don’t make a virtue of tolerance lest you end up standing for nothing. Freely express your views and show tolerance to those who differ. Like the old adage goes, agree to disagree.

Fired Sacco

I woman called Justine Sacco, while flying on a plane sent out a tweet saying 'Going to Africa. Hope I don't get AIDS. Just Kidding. I'm White!' Before the plane landed her company put out a notice that she was terminated. The company also stated that despite the controversial tweet, it had “otherwise known [Sacco] to be a decent person at core. As bad as that tweet is, I believe the company should have called her into the office and her managers should have questioned her about the tweet and then based on their investigation, if warranted should have fired her. We have teachers in New York City who are in what is called the rubber room. These teachers are known child molesters but they cannot be fired because the union protects their jobs so they just go to a special room each day and collect their pay. Reassignment centers are holding facilities for New York City Department of Education, where more than 600 teachers accused of misconduct were paid to work full time doing nothing for months or years at a time while awaiting resolution of their cases.[1] Among teachers they are referred to as rubber rooms.[2]The city has 13 reassignment centers.[3]

Sin

As everyone who reads the news knows, a man was suspended from a TV show because he said homosexuality is a sin. He is a Christian and that is what his faith teaches. This same faith also teaches that adultery is a sin and lying is a sin and coveting thy neighbor’s goods is a sin and not loving your neighbor as you love yourself is a sin and having false gods is a sin and not honoring your father and mother is a sin. Will people begin to lose their jobs if they say any of the above? His same faith teachers that all men are sinners so if says that will he get fired? This is not a matter of free speech as some have said because that only applies to government just as censorship only applies to government but the people who fired this guy have opened the door to a lot of other problem situations.

more tipping point

Here is another small example of the tipping point. Al Sharpton, a self-proclaimed civil rights leader, a man who always showed up whenever a suspected racial crime occurred, whether justified or not, is now holding meetings in Chicago to try to reduce the black on black murder rates, that have plagued the city. This, in my way of thinking, is a step forward in solving one of the major problems facing blacks in today’s world. While his being there is a positive, I am concerned with some of the early conclusions they have drawn. The main point coming out of these meeting, is that having more jobs will solve the problem and that certainly is the case in some instances but not the real cause surrounding these crimes, which is the breakdown of the family unit. There are black males in these communities who view a job at a fast food place as a dead end, who see a factory job where you can make twice that amount as a dead end. They compare these jobs with selling drugs where you can make ten times that amount. Selling drugs leads either to using drugs or drug wars or both. Sharpton like other black leaders are unwilling to admit that the disintegration of the family is the main cause, even though statistics show this to be the case. Perhaps this is their first step to reaching out to reconnect to the family values that used to be a part of the black community. Throughout their history, where they have been discriminated against, they always survived by relying on family and church. Revitalizing these two powerful cultural units along with today’s more enlightened view of racism could go a long way to solving some of these problems. At that point the use of vouchers to get some of these young people into a more disciplined learning environment could help reduce the education gap. You might call this whole process, hope and change.

tipping point

In a recent correspondence, where I indicated that the country may be reaching a tipping point when it comes to confidence in government and the way people see their government a minor incident has arisen that may in some small way illustrate the point. There is a TV show called, “Duck Dynasty” which I have never seen but it is involved in a controversy regarding political correctness and free speech. One of the stars of this show during a news type interview expressed his personal views on homosexuality and he was removed from his TV show. There has been a back lash and it appears that the free speech side may win the day. This is only the latest in a series of similar events over the past several years where this sort of back lash has won the day. This is just the opposite of what was happening say five or ten year ago. It falls into a larger category of what people refer to as attacks on Christianity. There was a time not that long ago that any criticism of gays was considered intolerant but now the thinking is that a person has the right to express their personal beliefs even if they do not approve of the gay life style. The freedom of speech argument seems to be winning over the political correctness argument and that is a tipping point.

Ryan plan

The Ryan-Murry budget just announced will affect military pensions for retirees between the ages of 40 and 62. There is a lot of controversy swirling around this so I did some calculations. An E-5 (Sergeant) after 20 years of service is earning $3,000 per month. He can retire at 50% of that or $1,500 per month. If he receives a 3% cost of living adjustment each year by the time he is 62 his pension will be $2,872. If the COLA is reduced to 2% he will be earning $2,319 at age 62. This is the proposal in the Ryan-Murry budget agreement. At age 62 this person’s pension will be adjusted to recapture the money lost in the years between 40 and 62. This is the worst case scenario. An average person would be 51 and have only 11 years until age 62. In that case his pension would increase from $1,500 to $2,076 with a 3% COLA and $1,865 with a 2% COLA. Once again at age 62 the pension would be adjusted to recapture the lost money between the ages of 50 and 62. The COLA for this year is 1.5% and will be reduced to 0.5%. This means that the 40 year old who retired after 20 years will have his pension increase from $1,500 to $1,867 by age 62 but with the one percent reduction he would end up with $1,674.

politically correct trap

I have often heard, supposedly wise people say that children are more influenced by what the parent does as opposed to what the parent says and if that is true it can lead to some very controversial conclusions. I offer a couple of examples, the first designed to lead you into a trap and the second to spring the trap. Johnny and his dad are traveling out of state and dad gets a speeding ticket and he just throws it away saying we won’t be back here. Johnny and his dad go to the hockey game together but dad doesn’t buy a ticket for his son, he just pushes him through the turnstile ahead of him. Dad’s TV antenna is getting old so one morning after a wind storm he goes up and pulls it down and turns in a claim to the insurance company. Dad fills out his taxes and declares charitable deductions for items he never gave to charity. Dad had a girlfriend on the side that Johnny knows about but dad tells him to keep quiet. Johnny gets to be a teen and is caught shop lifting and dad moans in shame and says where did I gone wrong? There the trap is set. Jimmy lives alone with his mom. She is on welfare and collects rent subsidies, food stamps, utility subsidies, and various other benefits that all together allow her to stay home and not work. Jimmy gets free lunch at school and they both get free health care through Medicaid. Jimmy gets to his teen years but does not see any reason to get a job but spends his time on the street with his friends waiting until his 16 so he can drop out of school like his mom did when she was 16. His mom never impressed upon him the value of education and she never read any books. There is a subtle but politically incorrect difference between these two situations. Think about it.

Read my lips

The controversy over The Presidents statements about keeping your doctor are reminiscent of Bush 41 who said, “read my lips, no new taxes” and then proceeded to raise taxes. Polls showed that most people agreed that taxes had to be raised but those same polls showed that people no longer trusted Bush and it cost him his re-election. The Gulf war ended in early 1991 and his ratings soared to 86% but during his run for re-election the Republicans who ran against and then in the general election the Democrats constantly showed him in commercials saying no new taxes. His poll numbers dropped to the low 40’s and he lost to Clinton. It didn’t help that Perot as an independent got 19% of the vote but his broken promise did him in. You can bet that in the up-coming elections you will see many ads against Democrats running for office reminding everyone of the pledge of keep you doctor.

Times are a changing

An old Bob Dylan song says times they are a changing and it is apropos for today’s world. This change has its roots in the Viet Nam War where disillusionment in government came to life. Over the next 20 years this feeling of unease was accelerated as the county slowly and painfully watched as the war on drugs and the war on poverty slipped away. On top of that came the realization that the government sponsored public education system was leaving behind our most vulnerable students while smaller areas like the post office and Amtrak floundered in sea of debt. Next came the public sector where employee benefits like pensions and health care were causing cities, counties and states to follow the federal government into the abyss of debt. The concept of spending more than what one earns spread to the private sector and now when we total up our long term obligations to future generations we are approaching the time when we will have to introduce an new word into the average person’s vocabulary and that word is quadrillion. And now we are confronted with the final straw in the governments back and that is Obamacare. The belief that the government could solve problems started with the great victory in WW 11 but as the deficits piled up year after year times started a changing. When Reagan said that the government is not the solution but the problem he stuck a cord deep inside the people and that has come alive over the past thirty years and people are now awake and ready to turn the ship of state around. As people watch the huge apartment complexes known as, “the projects”, or what I like to call the modern day equivalent of the reservation, come tumbling down overwhelmed by crime and addiction they began to have doubts. When year after year we see the inner cities crumble both literally and figuratively as the gap in education grows ever wider we have doubts. When individuals lose their dignity as they are forced to rely more and more on government aid and when words like personal responsibility are considered racist we have doubts. When young boys grow up with no role models and young girls seek the safety of their own apartments by having babies we have doubts. When the government bails out big banks and big corporations while people lose their homes, we have doubts. When elected officials care more about party than country, we have doubts. When so many see their only hope for the good life is winning the lottery we have doubts. But in the midst of all these doubts there is still hope because there is a changing. It is the awakening of the individual spirit that made this country great and it will arise again like the Phoenix. It is the realization that each of us must learn to take responsibility for our lives and reach for the brass ring. In this great land, the home of the free and brave it can be done and it starts with a change in attitude. We must get back the can-do attitude we had when I was growing up. We hear in the news every day that we have just been through the worst economic times since the Great Depression but those people came through and built the greatest generation and it can be done again because times are a changing.

Changing

An old Bob Dylan song says times they are a changing and it is apropos for today’s world. This change has its roots in the Viet Nam War where disillusionment in government came to life. Over the next 20 years this feeling of unease was accelerated as the county slowly and painfully watched as the war on drugs and the war on poverty slipped away. On top of that came the realization that the government sponsored public education system was leaving behind our most vulnerable students while smaller areas like the post office and Amtrak floundered in sea of debt. Next came the public sector where employee benefits like pensions and health care were causing cities, counties and states to follow the federal government into the abyss of debt. The concept of spending more than what one earns spread to the private sector and now when we total up our long term obligations to future generations we are approaching the time when we will have to introduce an new word into the average person’s vocabulary and that word is quadrillion. And now we are confronted with the final straw in the governments back and that is Obamacare. The belief that the government could solve problems started with the great victory in WW 11 but as the deficits piled up year after year times started a changing. When Reagan said that the government is not the solution but the problem he stuck a cord deep inside the people and that has come alive over the past thirty years and people are now awake and ready to turn the ship of state around. As people watch the huge apartment complexes known as, “the projects”, or what I like to call the modern day equivalent of the reservation, come tumbling down overwhelmed by crime and addiction they began to have doubts. When year after year we see the inner cities crumble both literally and figuratively as the gap in education grows ever wider we have doubts. When individuals lose their dignity as they are forced to rely more and more on government aid and when words like personal responsibility are considered racist we have doubts. When young boys grow up with no role models and young girls seek the safety of their own apartments by having babies we have doubts. When the government bails out big banks and big corporations while people lose their homes, we have doubts. When elected officials care more about party than country, we have doubts. When so many see their only hope for the good life is winning the lottery we have doubts. But in the midst of all these doubts there is still hope because there is a changing. It is the awakening of the individual spirit that made this country great and it will arise again like the Phoenix. It is the realization that each of us must learn to take responsibility for our lives and reach for the brass ring. In this great land, the home of the free and brave it can be done and it starts with a change in attitude. We must get back the can-do attitude we had when I was growing up. We hear in the news every day that we have just been through the worst economic times since the Great Depression but those people came through and built the greatest generation and it can be done again because times are a changing.

Pope's economics

I, like many others, see our new pope as a man of the people and he recently said that many around the word are too materialistic. I am not sure that he understands the free market capitalist system. When consumers buy stuff they create profits for the companies that sell stuff and these companies create jobs and all of these people pay taxes. Some of the profits from companies and some of the taxes that governments collect are used for research and development. From this R&D came things like the polio vaccine, AIDS medicine which saved lives in Africa, farm equipment that allow the US to feed our population and many millions around the world. Over 2 billion people have access to the Internet and over 5 billion have cell phones. People in remote parts of the world are now connected and this helps them learn new ways of doing things. R&D has brought clean water to many parts of the world and reduced the health problems associated with bad water. The ways in which R&D has improved the lives of people around the world is almost endless. If consumers here in the US quit consuming we will have a depression and that will spread around the world and the poorest of the poor would be hurt the most. Remember when the United States sneezes the rest of the world catches a cold and the third world countries get pneumonia. I think the pope needs an economic advisor and that with his good heart and his good intentions could go a long way to helping many of the poor around the world.

Health care cost

In 1973 I sat in a classroom for three full days listening to an expert tell me about health care insurance. The morning of the second day my classmates and I discussed what we had learned and we all agreed there were two major problems. The first was that with low deductible and low co-payments the patients did not pay out of pocket enough for services rendered and this would cause a rapid increase in cost. The second was the realization that no country could afford to provide total care for all of its citizens. Fast forward 40 years and much to my surprise Obamacare has stumbled and bumbled its way into solving both of these problems. The up-front cost problem is solved with high deductibles and the total care is solved by rationing. The rationing will be primarily directed toward patients near the end of life and the deductibles will hit the middle and upper middle class. These two aspects of Obamacare will reduce the long term cost and bring that in line with the regular cost of living. The saving will be large enough to provide free or almost free care for the poor and Obamacare will do all that was promised. It will reduce long term cost and insure everyone. Since money was taken from Medicare by reducing payments to physicians and hospitals there will be some reduction in service to us folks who are on Medicare and of course we will face the prospect of rationing but remember there is no free lunch.

Language

Tonight on the news I saw a supporter of Obamacare say that things are in disarray now but they will get better and by 2019 the cost will start to come down. I thought to myself how convenient because there is no way I can disprove that statement. The other day the President said the web site will be operating at 80% efficiency and this is another thing that cannot be disproved because we don’t know 80% of what. It was the same when the President talked about 3 million jobs saved or created and when they passed the stimulus the President said if they hadn’t done that things would have been worse. These guys are slick

Iran enrichment

The news about the agreement with Iran is being presented with an upbeat positive spin but the whole truth is not being told. Here is a quote from Secretary Kerry. Iran will stop enriching uranium beyond 5% and neutralize its stockpile of uranium enriched beyond this point. The amount beyond is about 20% and could be used as a bomb but would be bulky and awkward. The bomb dropped on Japan used 80% enriched. What Iran has done to neutralize is to change the uranium hexafluoride that is used in the centrifuges to uranium oxide. What is not revealed is that this oxide can easily and quickly be returned to the hexafluoride. In other words they have kept their 20% product on hand for future use. One common way to deceive is to reveal only part of the story and in this case it is the saying that they have neutralized without pointing out that this process is reversible. Another point has to do with inspections. IAEA has been inspecting the civilian plants but not the military instillations and this process will continue but it is presented as if this is some new inspection.

Iran nukes

As I watch the negotiations with Iran over its nuclear program, I am reminded of how Saddam Husain used the west, in his claims of not producing WMD. His strategy was to hide his efforts from the IAEA inspectors to create doubt as to his intentions. It was a classic case of miss-direction. He would say he had no such weapons and when the inspectors came to verify, he would secretly move resources around, giving the impression that he was hiding something. All the while this was going on, he was allowed to sell oil for food and medical supplies, money that he used instead to build up his army and increase his personal wealth. Every time he claimed that he had destroyed the weapons, which by the way we and other countries gave him, the IAEA would ask where he did this and he would not tell them. He knew that they could test soil samples and determine if he was being truthful. This game of cat and mouse went on for years until the US finally invaded and took down his government. Now we have Iran playing the same miss-direction game. They have suffered economic hardships because of their potential threat to build a bomb. Just like Saddam they have been willing to let their people suffer short term hardship to achieve a long term victory. They have built rockets to use as delivery systems and in the process have kept the price of oil up. This threat has kept their enemies in the region at bay and made them into the power house in the Middle East. Now they are in a position to collect economic benefits that have been withheld plus a lot more. President Obama is in a weakened position here at home and looking for a success in foreign policy and he is willing to ignore warnings from our ally Israel. Iran is still holding on to the threat of building a bomb but in a slightly limited way. It has always been my contention that Iran never wanted a nuclear bomb and I base that on the fact that they have been working with the latest technology for 25 years and have yet to produce enough enriched uranium to make a single bomb. In the 1940’s the US in the Manhattan Product created enough enriched uranium to make a bomb in three years using equipment from that time period. There is more going on here than meets the eye!

JP Morgan

J P Morgan Chase Bank has agreed to pay 13 billion in penalties and fines for their part in the mortgage crisis. In return they admit no wrong doing which means that no one goes to jail. The company has assets of 2,500 billion much of which they made during the mortgage debacle so the fine is a small payment to keep the executives out of jail. Nine billion of the 13 goes to various government agencies and 4 billion will go to 100,000 homeowners who suffered from the banks activities. This is $4,000 per home owner hardly enough to keep them from losing their homes. The government is bragging up this great achievement and the bank is bragging up its concern for home owners. This type of corruption is rampant throughout the system.

Iran

I have an old friend who is a right wing Republican and when a democrat gets elected to the White House his only lament is foreign policy. His claim is that the country can recover from any domestic changes the president may make but we are vulnerable to his foreign policy. I have not talked with this man for 20 years but my guess is that he is worried that Obama may turn his back on Israel to get a deal with Iran and lock the US into a long term commitment that will allow the Iranis to complete their nuclear program. The Presidents motive being that he wants to divert attention away from the current domestic mess. I am naïve enough to believe that Presidents would put the country ahead of their personal agenda but I can’t be sure.

Sick care

With all the news about health care it occurred to me that it is a total misnomer. Yesterday on the news they said we spend 2.7 trillion dollars per year on health care and the way I see it is that we spend 2.7 trillion dollars on sick care. Most of this is spent on expensive high tech treatments and drugs. The US has 5% of the world’s people and we use 50% of the drugs. If you don’t think this is a serious problem just listen carefully to the side effects on an ad for a drug. Give some serious thought to the use of chemotherapy and radiation treatments. The question becomes why are so many of us so sick and the answer is life style. It is estimated that 80% of all health problems are related to life style, things like smoking, diet, improper sleep habits, miss use of mind altering drugs, including alcohol, stress and lack of physical activity. Instead of making changes in these life styles which would in fact be health care we instead choose treatments that are sick care. If we want to get medical cost under control the first step is to look at life style. Once those areas are under control the next step is to look into your social relationships and finally your spirituality. At this point you will be happier and healthier and will feel good and all of this is free.

Tax fraud

For the very rich the current capital gain tax is 23.8% and the current top income tax rate is 39.6%. If these rich people can move income from the ordinary tax rate to the capital gain tax rate they can save a ton in taxes. Mr. A buys a painting for 50 million dollars and holds it for number of years and then sells it for 100 million. At the same time his friend Mr. B buys another painting for 50 million and sells it for 100 million. Then each of them donates their paintings to charity to get a 100 million dollar deduction against their current ordinary income. In the current market these paintings are bought and sold by people who represent private buyers and sellers so we don’t know who they are. Mr. A had to put up 50 million to buy the original painting but when he sold it for 100 million he got his money back plus 50 million in profit. Normally he would pay capital gain tax on that profit but when he gives it to charity he gets a 100 million deduction. In Minnesota we have 9.5% state income tax for high earners so Mr. A’s total tax savings is 50 million dollars. Now what is not known is that Mr. A and Mr. B concocted this deal in advance. They agreed to buy each other’s painting at the highest auction price thus the 100 million sales tag. I have no proof that this sort of thing happens but I have noticed over the past 40 years or so that paintings have sold for very high prices and that the buyers and sellers are anonymous people whose deals are arranged by agents over the phone.

No preexisting conditions

Medicaid is among other things, health insurance for low income people. For most there was a small premium, something like $50 per month depending on the state you lived in. People did not buy into Medicaid because there was no pre-existing clause so people just waited until they got sick and then they bought insurance. Since Obamacare has eliminated the pre-existing conditions clause for al l insurance, I suspect that young healthy people will not buy insurance but just wait until they get sick and then buy it. Since the program depends on getting these young healthy people enrolled this will adversely affect the whole concept. I wish the news people would discuss this.

Good and evil

The conflict between good and evil is one of the precepts of the Zoroastrian faith, first enshrined by Zarathustra over 3000 years ago. It is also one of the most common conventional themes in literature, and is sometimes considered to be a universal part of the human condition. While there have been many famous stories written to illustrate this conflict the most recent being, “Star Wars”, I feel this battle is fought on a daily basis within the hearts of individuals. I believe that people are both human and divine. Our human side is physical, mental and emotional and our divine side is spiritual. Our human side is located in our minds and its leader is our ego, and our divine side is located in our hearts and souls and is led by our spirituality. Our plan for our life comes from our ego and Gods plan comes from our heart and each day we fight the battle between these two plans. The ego never sleeps. It is constantly looking for ways to make us look good, to gain the spotlight to say to the world, look at me, here I am. Gods plan is always looking for ways for us to use our talents, knowledge and experience in ways that are helpful to others. Most of the time the ways in which we help will be known to others but it is best if no one knows. Mathew in the New Testament says: When you give to the poor, don’t let anyone know about it. Then your gift will be given in secret. Your Father knows what is done in secret, and he will reward you.

Sick care

With all the news about health care it occurred to me that it is a total misnomer. Yesterday on the news they said we spend 2.7 trillion dollars per year on health care and the way I see it is that we spend 2.7 trillion dollars on sick care. Most of this is spent on expensive high tech treatments and drugs. The US has 5% of the world’s people and we use 50% of the drugs. If you don’t think this is a serious problem just listen carefully to the side effects on an ad for a drug. Give some serious thought to the use of chemotherapy and radiation treatments. The question becomes why are so many of us so sick and the answer is life style. It is estimated that 80% of all health problems are related to life style, things like smoking, diet, improper sleep habits, miss use of mind altering drugs, including alcohol, stress and lack of physical activity. Instead of making changes in these life styles which would in fact be health care we instead choose treatments that are sick care. If we want to get medical cost under control the first step is to look at life style. Once those areas are under control the next step is to look into your social relationships and finally your spirituality. At this point you will be happier and healthier and will feel good and all of this is free.

JP Morgan

J P Morgan Chase Bank has agreed to pay 13 billion in penalties and fines for their part in the mortgage crisis. In return they admit no wrong doing which means that no one goes to jail. The company has assets of 2,500 billion much of which they made during the mortgage debacle so the fine is a small payment to keep the executives out of jail. Nine billion of the 13 goes to various government agencies and 4 billion will go to 100,000 homeowners who suffered from the banks activities. This is $4,000 per home owner hardly enough to keep them from losing their homes. The government is bragging up this great achievement and the bank is bragging up its concern for home owners. This type of corruption is rampant throughout the system

Iran nukes

As I watch the negotiations with Iran over its nuclear program, I am reminded of how Saddam Husain used the west, in his claims of not producing WMD. His strategy was to hide his efforts from the IAEA inspectors to create doubt as to his intentions. It was a classic case of miss-direction. He would say he had no such weapons and when the inspectors came to verify, he would secretly move resources around, giving the impression that he was hiding something. All the while this was going on, he was allowed to sell oil for food and medical supplies, money that he used instead to build up his army and increase his personal wealth. Every time he claimed that he had destroyed the weapons, which by the way we and other countries gave him, the IAEA would ask where he did this and he would not tell them. He knew that they could test soil samples and determine if he was being truthful. This game of cat and mouse went on for years until the US finally invaded and took down his government. Now we have Iran playing the same miss-direction game. They have suffered economic hardships because of their potential threat to build a bomb. Just like Saddam they have been willing to let their people suffer short term hardship to achieve a long term victory. They have built rockets to use as delivery systems and in the process have kept the price of oil up. This threat has kept their enemies in the region at bay and made them into the power house in the Middle East. Now they are in a position to collect economic benefits that have been withheld plus a lot more. President Obama is in a weakened position here at home and looking for a success in foreign policy and he is willing to ignore warnings from our ally Israel. Iran is still holding on to the threat of building a bomb but in a slightly limited way. It has always been my contention that Iran never wanted a nuclear bomb and I base that on the fact that they have been working with the latest technology for 25 years and have yet to produce enough enriched uranium to make a single bomb. In the 1940’s the US in the Manhattan Product created enough enriched uranium to make a bomb in three years using equipment from that time period. There is more going on here than meets the eye!

Veterans Day

This is a note I sent to my grandchildren recognizing that many young people are not familiar with Veterans Day. This coming Monday, November 11th is Veterans Day. World War 1 ended in 1918 and the official peace treaty was signed in Versailles, France at the 11th hour of the 11th day of the 11th month and so we celebrate this holiday on November 11th. It is the day we honor all of our service people both dead and alive.If we did not have the freedoms that these service people preserved for us, we would not have any holidays, so I believe this makes Veterans Day the most important holiday. When your mom was little I wanted to impress on her the importance of this holiday so I wrote a short verse to remind her. The verse is important today when we see the wounded warriors who have such terrible injuries. Because of the advancements in field medicine many warriors who in past wars would have died are now returning home with these serious injuries. Here is the verse I wrote and I hope it has some meaning for you. I suggest that on this day you make it a point to thank a veteran.If you don't know any, you can call Grandpa Whyle and thank him. I am sure he will appreciate it. He was just a young man, when the call went out Would he fight for his country, there would be no doubt They worked him and trained him, and gave him a gun Then onto the boat, with a go get'um son The battle raged fierce, the guns were so lond The sky was all red, his mind in a cloud When next he awoke, all wrapped in a chair And heard the doc say, he'd always be there Now the days all drag by, the past drifts away He sits on the porch, and has nothing to say.

How to sell Obamacare

For the past few weeks I have been hammering home the point that the average person has trouble understanding insurance. To further illustrate the point I offer the following story that was told to me as truth. During WW 11, the government wanted to encourage military people, to purchase a life insurance plan that cost $6.50 per month for $10,000 in coverage. They sent around this young lieutenant to explain this new program but after speaking for two hours before each of a dozen large groups, he got very little response. At the next meeting an old sergeant who had been with him all along asked if he could talk and the lieutenant said, go for it Sarge. The seasoned sergeant spoke for thirty seconds and everyone signed up and here is what he said. Men the government has come out with a new life insurance plan and it cost you $6.50 per month for $10,000 of insurance. This means that if you buy this insurance and you go overseas and get killed the government will pay your family $10,000. If you don’t buy this insurance and you go overseas and get killed the government will pay your family nothing. Now when you get overseas who do you think the government will send to the front lines first? What Obamacare needs is a whole bunch of old sergeants.

Glitch

One of the main computer glitches in Obamacare is caused by the fact that they want the poor people to see the subsidies they will receive if they sign up. This means they must first enter all their personal financial data before their subsidy can be calculated. The fear is that if people see the cost before the subsidy they will get turned off and not apply. Typically a person living near the poverty level will get insurance at no cost but it will show their cost as $200 per month or so. Once the subsidy is applied their cost is much less.

The next Obamacare problem

According to the news people the big problem with Obamacare is signing up but they are mistaken. That is the current problem but in time it will be overcome and then comes the BIG problem. As a financial planner I took many home study courses and they lasted 18 weeks. You would study one section each week and at the end of the semester you would go to the local university and take a two hour written exam. You were told you must use all of the technical terms in order to pass and when it was over you were advised never to use those terms again. The reasons for this became clear when I started sitting across the table from mom and dad explaining insurance. Even the basic terms like premium, co-pay, deductible, stop loss, co-insurer, out of pocket and preferred provider caused no end of consternation. The first group to sign up will be those who are uninsured which means they have likely never seen these terms before. They will be asked to select from dozens of different plans and after reading through a page of one plan they will through up their hands in frustration. The first thing that most people told me was that they don’t know much about insurance and they said it in a tone that led me to believe that they didn’t want to know. This will be further complicated by some people qualifying for subsidies and what they get may depend on the kind of plan.

What is Obama up to

Over these past five years I have been a close observer of President Obama and believe that I understand his vision for America. He is a composite Politian, one part community organizer and one part Chicago politics. He objective is to transfer income from those who earn it to those who in his opinion need it. Obamacare is a prime example. Low income people those below the poverty level will receive free or subsidized health care paid for taxpayers. We have 140 million people working and only 70 million pay taxes. The President did not start many programs but they have expanded under his tenure. For example last year, 30 million low income families receive earned income credit up to $5,000 per family. This is money taken from tax revenues and given to people who paid no taxes. 80 million Americans are on Medicaid which is almost free health care, 48 million receive food stamps, 25 million received Women’s and Infants Care (WIC), 13 million housing allowance and 6 million receive cash assistance. In addition we now have 7 million collecting unemployment. As a community organizer The President learned early on that you can use the carrot or stick to get votes. If you are providing government benefits or if you threaten to take away benefits, you can encourage people to vote for you. The President is not concerned about deficit spending as long as it is used to garner more potential voters. The great French political thinker de Tocqueville said: “The American Republic will endure, until politicians realize they can bribe the people with their own money.” For many years the government was bribing the rich for votes and we could get away with that because there were not that many rich but as we move toward bribing the poor we will go broke because there are just too many poor. We can afford to give billions in corporate welfare but not trillions to the poor. I am not proposing that we do either but we certainly cannot do both. In all of this I have not included the cost of social security and Medicaid and the yet to come Obamacare. Better keep those printing presses running around the clock.

Obama plan

There are 51 Democrats, 47 Republicans and 2 Independents in the current US Senate. Senator Cruz in his attempt to stop Obamacare got the House of Representatives to vote against it and proceeded to get the Senate to do the same. He needed all of the Republicans, the two Independents and 1 Democrat to vote with him. He gave a 21 hour speech and got the nation fired up to back his attempt to stop Obamacare. He gave the impression, apparently believed by many, that this could be done. He failed to get any Democrats or Independents and not even all the Republicans to vote with him. You might wonder why the Republicans, none of whom voted for Obamacare in the first place would fail to back him. The answer is that they understand how the constitution works, something many Americans do not. The President had said on many occasions that if the Senate passed the bill he would veto it. To override the veto requires that 67 Senators vote to override and everyone who understood the rule knew that this was not going to happen. I would really like to know what Senator Cruz was trying to accomplish. President Obama knows the Democrats will not take back the house in 2014 and so he will have to fight them to pass any of his programs or be a lame duck for the next three years. His plan is to split the Republicans and use the divide and conquer approach and Senator Cruz helped. Obama’s next move is to bring up immigration reform which will further divide the Republicans. I can only assume that these Republicans are only doing what we always ask our politicians to do and that is to stand by your principles and forget about getting elected.

Obamacare

As the mystery surrounding the disastrous roll out of Obamacare unfolds two salient points are rising to the top. First a decision to keep the details hidden until after the November 2012 elections caused a delay. This resulted in the loss of valuable time to get the project completed and caused later errors in trying to catch up. The second was a last minute decision not to allow users to see the cost without the subsidy. There was concern that if someone saw the cost before the subsidy they would get turned off and not buy. This is particularly important for low income people. For example a family earning less than $30,000 might well qualify for free health care but without the subsidy the cost might be $300 per month. A young family man checks out the site and finds the cost is too high and decides he cannot afford health care not realizing that there is a subsidy. In order to determine the subsidy the person must impute a lot of personal data, like social security numbers, family income and ages. Only then can the government determine the subsidy that this family is entitled to but this additional step caused a lot of hang ups in the system.

Rise of women

I turned 76 this past week and as I look forward to the last quarter of my life, I see things throughout the world that are disturbing but just when pessimism raises its ugly head, I see growing on the horizon the great hope for America and thus the world. It is all around us but it has crept in on cats paws and we really didn’t notice. It is the rise of a new power that has lain dormant for centuries but has been awaken from its slumber. It is an energy greater than the atom, yet surrounded with a force of love that makes men tremble. It is the unchaining and releasing of the female intellect to grow and develop. Today in American 60% of college students are women. They represent the majority in Medical Schools and Law Schools as well as Graduate Schools. There has never been a time in the history of the world where any country has tapped into this power in such a grand manner and this new force will be the beginning of a new revolution in America that will spread around the world. Technology has removed the need for physical strength and opened the door of opportunity for all blessed with mind and ambition. I say come on in to all the ladies. The world has been waiting a long time.

Wise king

Many years ago there lived a wise king who one day called his scholars together and asked them to write down all of the knowledge they had accumulated so that future generations could build on that. A year later they returned with 12 large volumes and he said, no, no. People will not have time to read that, go back and condense it. A year later they returned with one large book and he sent them away again. Finally three years later they handed him a piece of paper and he read it and said that is what I was looking for and the on the paper was written one sentence and it said, “there ain’t no free lunch”! If you were raised in a home where you were taught that you must work to support yourself, you understand the message but if you were brought up in a well fare home you may not. What was your home like? When President Obama came out five years ago and announced that his new health care plan would insure 31 million new people and it would not cost anything, did you believe that. Do you think he believed that? The answer depends on how you grew up.

Putin and Obama

The news people were in agreement that Putin and Obama did not get along but they may have been mistaken. I say that because today Putin got Obama out of a very awkward situation by offering to discuss the placing of Syria’s chemical weapons under the care of an international group. Immediately Obama said that he had previously discussed this action with Putin and that we would not be at this point if he, Obama, had not threatened to use the military against Syria. This is a great example of snapping victory from the mouth of defeat. It is one of Obama’s best political coup’s. The Presidents demeanor immediately reflected his new found way out and I say great. The Syrian foreign minister said he would look into the idea and the United Nations quickly announced a meeting to discuss the proposal.

New Pope

I have been watching the new Pope and I couldn’t be more pleased. His central theme is to look out for those in need. He recently chastised those who concentrate on divisive issues like abortion, same sex marriage and contraception. These are issues designed to allow people to pass judgment on others. It allows some to tell others how they should live their lives and what they should believe. Notice the,”shoulds”, in that sentence. I believe the Pope is telling us to quit wasting all that psychic energy fighting over issues and get on with sharing your talents, knowledge and experience with others in ways that are helpful. Give up trying to be right and trying to convince others of your right and get on with reaching out a helping hand. There are people around you every day that need what you have to offer. Open your eyes and see, and open your heart to those crying out for help. This is what I hear this new Pope saying to me.

5 and 50

I have pointed out that private health care companies cannot ration care because competition will not allow it but a government plan with no competition can. For those willing to face reality they will quickly understand that the country cannot afford to offer all total care to every person and thus the need for rationing. There is something called 5 and 50 in our health care system and it refers to the fact that 5% of the population uses 50% of all health care resources. One half of the population spends on average $236 per year per person while 5% spends $41,000 per year per person. Going further 1% of the people spend $90,000 per year per person. Regardless of what kind of health care system we end up with some type of rationing will be necessary and people don’t like to hear this but the money is just not there. We can close our eyes to the situation and keep kicking the can down the road but death panels are on the way. The longer we postpone this, the more difficult it will be because new and costly technologies are continually being developed.

Obamacare

For the advocates of a national health care system these times are frustrating. It’s because they originally wanted a single payer system somewhat like Medicare but that was not politically feasible so they settled for this quasi-government/private plan called Obamacare. The hope is that in time this is what we will end up with as companies and government agencies all abandon their health care plans and switch over to Obamacare at which time it will become the desired single payer plan. If this happens we can get a glimpse of the cost and changes that will take place. First change will be the elimination of 10 million jobs in the insurance industry. These are people who have at a minimum a 12 grade education, people who for the most part have families and are homeowners, people who are productive tax paying citizens. They are computer savvy and adept at dealing with government and insurance paperwork. They will eventually work their way back into the system. Today there are 50 million people on Medicare and the annual cost is 600 billion or $12,000 per person per year. On the other end of the spectrum we have Medicaid and there are 60 million people covered at a cost of 400 billion or $6,000 per person per year. Since this group includes the old and the young we could say that if everyone were on the same plan the cost would be $9,000 per person per year. Since we have 310 million people we can project the cost at 2.8 trillion dollars which is close to the current cost of health care for the country. Much of the cost of the current health care system is born by employers but that will change and the cost will be shifted to the government. People who are currently insured by their employer, be it private or public will be moved to Obamacare and many will not like it because employer plans, especially those negotiated by union contract, are significantly better than even the best plan under Obamacare. This is one of the reasons that the big unions are objecting, however their objections since they met privately with the president have been muted, leading people to believe that they struck a deal allowing them to opt out of Obamacare. For every group that is allowed to opt out the cost to those remaining will increase. Once everyone is under the single government plan the move toward rationing will accelerate and most of us will have our treatment options determined by a group of experts living in Washington DC. This is the way that Medicare operates but the new plan will ration more in order to meet the cost of the ageing population.

Syria

The news people were in agreement that Putin and Obama did not get along but they may have been mistaken. I say that because today Putin got Obama out of a very awkward situation by offering to discuss the placing of Syria’s chemical weapons under the care of an international group. Immediately Obama said that he had previously discussed this action with Putin and that we would not be at this point if he, Obama, had not threatened to use the military against Syria. This is a great example of snapping victory from the mouth of defeat. It is one of Obama’s best political coup’s. The Presidents demeanor immediately reflected his new found way out and I say great. The Syrian foreign minister said he would look into the idea and the United Nations quickly announced a meeting to discuss the proposal.

American exceptionalism

The subject of American Exceptionalism has once again come up in the news and I would like to relate anecdotally a personal experience. In the summer of 1957 I was working in a flour mill in Springfield, IL and we had three mills. The C Mill was the largest and could produce 1,400 pounds per minute of whole wheat flour. That summer we packaged this flour in ten pound bags and we ran for four months and during that time we produced 24 million bags. We had to get special permission from the state to run more than 6 straight days and they allowed us to run thirteen days and then we would shut down for one day and start up again. These bags were printed on one side in English and on the other side in Arabic and they were sent to Saudi Arabia. The print said this flour is a gift from the people of the United States to the people of Saudi Arabia. At that time there were only 4 million people living there and they were mostly Bedouins roaming around the desert. This was enough four to give every man, woman and child 60 pound and that was a huge supplement to their regular diet. It was during this same time that big American companies like Standard Oil sent engineers and equipment there and developed the oil fields. This was a shared adventure with the country and the oil companies but later the country nationalized the oil business and today they own it all. Today Saudi Arabia is a thriving prosperous county owing in no small part to the early gifts of food and talent from the United States. Yes they had oil but for thousands of years they did nothing about it until the west came in to help. A good business deal is when both sides win and this was one. A small thing, perhaps compared to the way we helped Germany and Japan after the war but my guess is there are many other such examples of help that most of which we are not aware. Note that the religion of the two groups played no part in their cooperative effort as is the case in business. Capitalism is about creating profits and in the process creating prosperity.

Wise king

Many years ago there lived a wise king who one day called his scholars together and asked them to write down all of the knowledge they had accumulated so that future generations could build on that. A year later they returned with 12 large volumes and he said, no, no. People will not have time to read that, go back and condense it. A year later they returned with one large book and he sent them away again. Finally three years later they handed him a piece of paper and he read it and said that is what I was looking for and the on the paper was written one sentence and it said, “there ain’t no free lunch”! If you were raised in a home where you were taught that you must work to support yourself, you understand the message but if you were brought up in a well fare home you may not. What was your home like? When President Obama came out five years ago and announced that his new health care plan would insure 31 million new people and it would not cost anything, did you believe that. Do you think he believed that? The answer depends on how you grew up.

Third party payer

There is a solution to the health care cost problem but vested interest are opposed to the idea. It is based on the concept of getting away from third party payers. Suppose you could purchase food insurance. You would pay a monthly premium and then you could go the market, buy your groceries and present your card and go home. After a while you would be concerned about the quality of the food and the location of the store but you would not care about the price. I have often heard people who were in the hospital talk about two dollars for cotton balls and three dollars for aspirin but they do it in a light hearted way because they didn’t have to pay out of pocket. It is estimated that 25% of the cost of health care is in administration and ask any physician and they will confirm that the paper work is expensive. If we could reduce this cost, the savings could be used to take care of the uninsured. Assume that have your health insurance through your employer. On average the employer pays $9,000 per year for a family plan. Typical plans are $100 deductible, 10 to 20% co-pay and some maximum annual out of pocket, on average $2,000. I propose that the company set up a $10,000 annual deductible plan, and this would cost them about $3,000 per family. You would be responsible for the cost of all your health care until it reached $10,000 for your family year at which time the insurance would cover the rest. Whenever you needed health care you would shop for it just as you do other items you purchase. After you have selected your provider you would pay your bill directly to them. They would not be required to contact the insurance company or to fill out any forms other than your receipt. Your treatment would be decided between you and the provider. You would keep track of your annual family health care expenses and if it should ever exceed $10,000, only then would you file a claim, otherwise you would just turn in your total receipts for the year. If you had a year with no claims the insurance company would deposit $7,000 into an account with your name on it. If your claims came to some amount less than $10,000, say $3,000 the insurance company would subtract $3,000 from the $7,000 and put $4,000 into your account. At the end of some predetermined time the insurance company would send you a check for the entire amount in your account. If the above $3,000 annual cost continued for a ten-year period the company would send you a check for $40,000. This procedure would eliminate the paper work on 98% of all claims (those less than $10,000) and thus the reduction in administrative cost. The savings is enough to provide the uninsured with a $10,000 annual deductible policy and they would have the same plan that those with company sponsored plans. There are additional savings involved if the government would allow your savings to accumulate on a tax free basis. Such plans have been around for some years now but large companies have not gotten involved with them. One company Golden Rule has such plans. This of course could also be a national health care plan sponsored by the government where everyone has the same plan. The point is that as long as you have a third party payer system cost will continue to increase more rapidly than other cost that are controlled by the purchaser. You only have to understand human nature to figure this out, but vested interest have too much to lose and that is why we don’t have such a system in place right now.

Obamacare

Health care in America is at a crossroads and the big problem is the rising cost. My preferred solutions is to get rid of the third party payer but that means the elimination of 10 million jobs in the insurance industry and the vested interest are so well entrenched that this will not happen. The second alternative is Obama care or something similar and with all the talk about the cost one might well ask, how this could possible help but the answer is to look further down the road. The initial cost will grow but as the plan is fully implemented the cost will decline. It is well known that 75% of the cost of healthcare occurs in the last two years of life and this is where Obamacare will save money. There will be a committee set up in Washington to decide on what type of care will be provided and the key to savings is in rationing. They will start with the less provocative cases and move forward. For example they might decide that a ninety year old man with a bad heart does not qualify for a liver transplant and then work toward more controversial cases. The reason we find ourselves in this predicament is that science and technology have out-paced our ability to pay. The country cannot afford to offer everyone every possible treatment so rationing, the so called, “death panels”, is the only alternative. The very wealthy using their own resources will buy what the rest of us will do without. This is not a new idea since our legal system has been operating this way forever. If you can afford, “The Dream Team”, that OJ Simpson had, your chances of success are much greater than some poor inner-city kid who robbed a convenience store.

Putin to Obama's rescue

The news people were in agreement that Putin and Obama did not get along but they may have been mistaken. I say that because today Putin got Obama out of a very awkward situation by offering to discuss the placing of Syria’s chemical weapons under the care of an international group. Immediately Obama said that he had previously discussed this action with Putin and that we would not be at this point if he, Obama, had not threatened to use the military against Syria. This is a great example of snapping victory from the mouth of defeat. It is one of Obama’s best political coup’s. The Presidents demeanor immediately reflected his new found way out and I say great. The Syrian foreign minister said he would look into the idea and the United Nations quickly announced a meeting to discuss the proposal.

All in Syria

The following is a hypothetical situation made up in the mind of your distinguished but sometime disoriented host. Obama: There will be two days of bombing and that’s it. Reporter: What about ground troops. Obama: Read my lips….no troops on the ground. One week later the Assad government has collapsed and there is chaos throughout the land with various groups running wild and all of the chemical weapons sites are left unguarded and reports are coming in that terrorist are loading up on these weapons. Obama: We must send in ground troops to protect the chemical weapons sites so they don’t fall into the hands of terrorist. Reporter: What about your statement concerning troops on the ground. Obama: Things have changed and a good manager is willing to change where new information presents itself. So if you are wondering why assurances from The President are not soothing fears but raising doubt, be advised that circumstances change and this is especially true in war. The day we bomb we are as they say in poker, all in.

Syria 09-05-13

Here is my latest view on Syria. As things stand now there are two separate groups trying to dislodge Assad from power. There is the Free Syrian Army described as non-sectarian and made up of Syrian citizens who are fed up with the dictator and a group of Muslim extremist headed by al-Qaida types. Conventional wisdom says that Assad will eventually fall and as he goes down he will resort to using WMD and when he is finished the country will dissolve into chaos. At this time the WMD stored at various places around the country will fall into the hands of which ever group gets there first. Which group that eventually takes control, might well depend on the action that the US takes at this time. If we back the Free Army they will likely gain control. My proposal for US action is based on the above scenario and involves the use of air intervention and supplying the Free Syrian Army with anti-tank weapons along with other military equipment. The air intervention will mean a no-fly zone and all Syrian planes will be shot down similar to what happened in Libya. The Free Army will agree to turn over all WMD sites to the US when Assad falls and we will go in and gather up these WMD. We will then assist the Free Army in their plan to set up a non-sectarian government (meaning it will not be based on Sharia Law but on more western principals). Our initial move against Assad should be swift and powerful to minimize the time he will have to use WMD. This means a large missile strike followed up with the air blockade. It is better to do nothing than the Presidents idea of a pin prick attack using tomahawk missiles.

Republican health plan

I was watching MSNBC today as they discussed Obamacare and the talking head said that the Republicans have no plan and this remark went unchallenged. Rep Tom Price introduced his health care plan even before Obama proposed his plan. During the run up to McCain’s nomination millions of dollars were spent vilifying the McCain health care plan. After that campaign the plan was sponsored by Paul Ryan and Tom Colburn. When the news is presented is such a manner, where inaccurate remarks are presented as truth, the press loses credibility. If the plan is not a good one that should be pointed out but too say there was no plan is somewhat disingenuous at best and dishonest at worst.

Boehner Syria

Yesterday Speaker Boehner announced that he would back The President’s plan to bomb Syria. Now the news media, always prefers controversy, so they can continue to report that the Republican congress is against everything Obama wants to do, so they reported this as Obama pulls off a coup. Here is how it could have been reported. Speaker Boehner, putting the country ahead of politics, agreed with The President in a plan to deal with the Syrian situation. The latest word is that the strike on Syria will not just make it more difficult to use WMD but will degrade Assad’s ability to wage war. If this is the case it should be swift and powerful because if it is not and Assad starts to lose the war gradually, he will do what dictators losing power always do. He will use any means available to maintain power, which means he will use WMD on a massive scale. If that happens, the US will be under pressure to intervene, even if it means boots on the ground. All of the promises not to use ground forces will go by the wayside. The latest information suggests that the majority of those opposing Assad in Syria are moderate secular Muslims and they could be counted on to rid the country of extremist if they got into power. If that is the case the US should go all out and as quickly as possible defang Assad while at the same time arming the rebels. An arrangement should be made with the rebels for this help by demanding that all WMD be turned over to the United Nations after Assad is deposed. After that the US should get out of the way and let the people in Syria decide what kind of government they desire.

Chemical weapons

We have recently heard that the use of chemical weapons is illegal and that is based on the Chemical Weapons Conventions which starts as follows: The Chemical Weapons Convention (CWC) is an arms control agreement which outlaws the production, stockpiling, and use of chemical weapons Notice anything odd about these words, in particular the word stockpiling. 98% of all countries signed on to this convention but Syria is not one of them. All of these countries around the world who signed the convention believe that these weapons should not be used but none of these countries are willing to step up to the plate and go along with the US to punish Syria. Their excuse is that the United Nations has not approved the bombing of Syria. As it stands now we have only one ally, France, but they have stated they will not go along unless our congress approves. We have no support from the United Nations, from NATO or any allies. If congress votes no then Obama stands alone against the world. His choosing to go to congress was a smart move. If they approve he can blame them if things go wrong and if things work out he will take the credit.

Culture war

When LBJ started the War on Poverty in 1965, it was, like many government programs, designed to help the poor. Typically a 16 year old single mom was given an apartment with a separate bedroom for her baby, food to eat, health insurance, cash and other benefits wrapped up in about a dozen other programs. In addition she could work and be eligible for Earned Income Credit. She could also file income tax and receive a $1,000 child tax credit even though she owed no tax. It wasn’t long before the street smart people got wise to this government largess and last year it was a 62 billion dollar bonanza. Through the sixties and seventies the program grew at a moderate rate but in the early eighties certain individuals like Jesse Jackson realized there was money to be made in the War on Poverty and this is where the safety net began its metamorphic rebirth into the hammock it is today. As is often the case the good intentions had unintended consequences. The 16 year old single mom was the daughter of another 16 year old single mom who was the daughter of another 16 year old single mom and that lead to three generations on welfare. What was intended to be a helping hand became a way of life. These young women who grew up in homes where there was no interest in education, were the pawns in a massive game of wealth payments that left them as permanent wards of the state. Recently certain commentators have been pointing out how these programs have affected the culture in the minority neighborhoods. Self-reliance was replaced with government aid, fathers were replaced with government programs, the work ethic replaced with government assistance and entire neighborhoods became dependent on government. As this culture of dependency is brought into the public’s attention those making money from it are upset and claim anyone who talks this way is racist. President Obama is aware of this cultural change and made reference to it in his MLK speech. Legitimate grievances against police brutality tipped into excuse- making for criminal behavior. Racial politics could cut both ways as the transformative message of unity and brotherhood was drowned out by the language of recrimination. And what had once been a call for equality of opportunity, the chance for all Americans to work hard and get ahead was too often framed as a mere desire for government support, as if we had no agency in our own liberation, as if poverty was an excuse for not raising your child and the bigotry of others was reason to give up on yourself. All of that history is how progress stalled. That's how hope was diverted. It's how our country remained divided. Oh, those unintended consequences will get you every time.

Protestors

Just prior to the US entry into the Iraqi War more than 100,000 protestors gathered at the United Nations building in New York but this time only a few hundred showed up. This was after the congress overwhelmingly approved going to war. The vote was 297 to 133 in the house and 77 to 23 in the senate.

Campaigning

President Obama once again illustrates the difference between campaigning and governing when he talks about sending missals into Syria like he did in Libya. Here is what he said as Senator Obama: “The president does not have power under the Constitution to unilaterally authorize a military attack in a situation that does not involve stopping an actual or imminent threat to the nation,” candidate Obama told The Boston Globe in late 2007. He added that the president can only act unilaterally in “instances of self-defense.” When Bush made the decision to go into Iraq he had the approval of 77 Senators including 28 Democrats. He even received encouragement from many democratic senators as shown in a letter sent to Bush. “[W]e urge you, after consulting with Congress, and consistent with the U.S. Constitution and laws, to take necessary actions (including, if appropriate, air and missile strikes on suspect Iraqi sites) to respond effectively to the threat posed by Iraq’s refusal to end its weapons of mass destruction programs.” — From a letter signed by Joe Lieberman, Dianne Feinstein, Barbara A. Milulski, Tom Daschle, & John Kerry among others on October 9, 1998 12 countries including the US gave hundreds of tons of chemical and biological weapons to Saddam and so the world knew that he had WMD. The mistake that the Bush administration made was to ask the question, “where are they”, instead of asking, “where did the go”. As we investigate further into the Syrian situation we may find out where they went since samples of these type weapons can be analyzed and there origin determined.

WMD Ok by US

I spent a lot of time in a Middle East chat room in order to find out why they have such strong dislike and mistrust of the USA. Watching the President express his deep concern and disdain over Syria’s use of chemical weapons is a case in point. Recall that the US along with a dozen other countries gave chemical weapons to Saddam and we stood by when he used them against Iran and against his own people the Kurds. In one Kurdish city 5,000 were killed and 7,000 injured in a chemical attack. As Washington ponders over whether to hammer Damascus over unidentified use of toxic agents in Syria, declassified CIA documents reveal that 25 years ago the US actually indulged ruthless Saddam Hussein to use chemical warfare gases in war with Iran. The recently declassified documents at the National Archives in College Park, Maryland, suggest that the US was closely following the use of chemical weapons by the Saddam Hussein’s regime both against the enemy in the Iran-Iraq War (1980-1988) and against Iraq’s Kurdish population, reports Foreign Policy magazine.

MLK Speech

Because they marched, America became more free and more fair, This idea that -- that one's liberty is linked to one's livelihood, that the pursuit of happiness requires the dignity of work, the skills to find work, decent pay, some measure of material security -- this idea was not new. Dr. King explained that the goals of African-Americans were identical to working people of all races: decent wages, fair working conditions, livable housing, old age security, health and welfare measures -- conditions in which families can grow, have education for their children and respect in the community. For over a decade, working Americans of all races have seen their wages and incomes stagnate. Even as corporate profits soar, even as the pay of a fortunate few explodes, inequality has steadily risen over the decades. Upward mobility has become harder And our politics has suffered. Entrenched interests -- those who benefit from an unjust status quo resisted any government efforts to give working families a fair deal, marshaling an army of lobbyists and opinion makers to argue that minimum wage increases or stronger labor laws or taxes on the wealthy who could afford it just to fund crumbling schools -- that all these things violated sound economic principles. And then there were those elected officials who found it useful to practice the old politics of division, doing their best to convince middle-class Americans of a great untruth, that government was somehow itself to blame for their growing economic insecurity -- that distant bureaucrats were taking their hard-earned dollars to benefit the welfare cheat or the illegal immigrant. And then, if we're honest with ourselves, we'll admit that during the course of 50 years, there were times when some of us, claiming to push for change, lost our way. The anguish of assassinations set off self-defeating riots. Legitimate grievances against police brutality tipped into excuse- making for criminal behavior. Racial politics could cut both ways as the transformative message of unity and brotherhood was drowned out by the language of recrimination. And what had once been a call for equality of opportunity, the chance for all Americans to work hard and get ahead was too often framed as a mere desire for government support, as if we had no agency in our own liberation, as if poverty was an excuse for not raising your child and the bigotry of others was reason to give up on yourself. All of that history is how progress stalled. That's how hope was diverted. It's how our country remained divided.

War on Poverty

During my career I spent a number of years in management and it was my goal to provide the time, tools and training to those who worked for me so they could do their jobs. I wanted to create an atmosphere where employees would want to do their best, improve their skills and provide incentives for those who reported to them. Leadership to me meant motivating people to desire to make the most of their talents. It was not my responsibility to do their job for them but to create a work place where they could make the most of their individual skills. I always listen carefully whenever The President gives a speech and Obama’s MLK speech was no exception. I liked what he said and agreed with most. It is much like many of my liberal friends when they say that people want to have a good place to live, a good job that pays a decent wage, health care for when they are sick, comfort when they are old and a good education for all. Here is the way the President phrased it: And with that courage, we can stand together for good jobs and just wages. With that courage, we can stand together for the right to health care in the richest nation on earth for every person. (Applause.) With that courage, we can stand together for the right of every child, from the corners of Anacostia to the hills of Appalachia, to get an education that stirs the mind and captures the spirit and prepares them for the world that awaits them. (Applause.) With that courage, we can feed the hungry and house the homeless and transform bleak wastelands of poverty into fields of commerce and promise. Took up the mantle of the King challange Less than two years after MLK gave his, “I Have A Dream Speech”, LBJ began the war on poverty believing that it was the government that would provide the road to all of the above mentioned benefits. 50 years and 12 trillion dollars later many informed people are admitting that we have lost the war on poverty. I suggest that we not give up on our desire to promote these benefits but we must act like a manager and

Football

Today I encountered another one of those situations that are totally baffling. The NFL has agreed to pay 765 million to 4,500 players who claim head injuries. This sounds reasonable assuming they can prove the injuries are due to football. Since I can’t think of any other reason why this many people, who have playing football in common, might have head injuries, I guess this makes sense. Now here is where the problem comes in. They are still playing football. Is the NFL going to set aside a sinking fund to that it ten years they can cough up another 700 million. What is the reason why they feel that there won’t be more head injuries in the future. It would be like banning head injuries from boxing. If these players really believe that playing football leads to head injuries why are they still playing. With 4,500 joining in the suit it is not a rare thing to have a head injury. It is the norm.

Fast Food Strike

I was watching the news today covering the nation-wide walkout of fast food employees. They are demanding wage increases from $7.50 per hour to $15.00 hour and secondly they want Obamacare. While I am personally 100% behind offering higher pay to these people, I am not sure if they understand the full impact of their demands. There are many young single people working part time at these places and I am not talking about them. I am interested in the full time employee who may be a single mom with two children. Right now as a full time employee she gets forty hours a week and benefits. The benefits vary in different parts of the country but include such standard things as health, disability and life insurance, pension plan, vacation, holidays and sick leave. Her situation is $15,000 per year in wages, plus $5,300 per year in federal earned income credit, $1,900 in Minnesota family income credit. In addition she receives a $2,000 federal income tax credit so her gross income is $24,200. These extra funds are not counted when determining her eligibility for addition benefits such as child care assistance, food support, medical assistance and single mother grants. When her salary is doubled to $30,000 many of these extras will be phased out some completely. I offer one example. The earned income credit from the federal program would be reduced from $5,300 to $3,800. One thing in her favor is that she will still not have to pay any federal or state income tax although her payroll tax withholding will increase from $1,150 to $2,700. If the company then decided to move employees to Obamacare her cost for that will increase from $57 per month to $193 per month. There are likely other items that I have overlooked but she should understand that her take home pay will not increase as much as doubling her salary might lead her to believe. F

Half pay for auto workers

During the recent economic downturn the auto industry was hit hard and the company in the best shape was Ford that did not need a government bailout. Ford survived but had to reduce the number of employees by 50% including some 35,000 in the union. Part of the agreement with the union specified that any new hires would state at $15 an hour compared to the retained union members who are paid $30 per hour. This reminded me of a situation I encountered while working in Ohio where our plant had a cafeteria and as a part of the union negotiations the operating of the cafeteria was turned over to the union. They hired new employees to run the cafeteria and proceeded to pay them half the wage of the average plant employee. Funny how things look from the other side of the fence!

Syria

Here is a quote from President Obama from August 18, 2011: “The future of Syria must be determined by its people, but President Bashar al-Assad is standing in their way,” Obama said in a written statement. “For the sake of the Syrian people, the time has come for President Assad to stepaside.” On a number of occasions over the past two years Obama has said that Assad must go. Now he is preparing to respond to Assad’s use of chemical weapons and he says it is not our policy to promote regime change but only to discourage the use of WMD. Ideally we should have intervened two years ago by arming the militants but since we did not do that, I believe we should now stay out of it. If they want to destroy their own country, that is their business and like many people say when talking about Afghanistan and Iraq, we are not the world’s policeman.

Medical Catastrophic Coverage

The recent interest in rescinding Obamacare reminded me of the 1988 Medicare Catastrophic Coverage Act. For those of you who may have forgotten this was the first change to Medicare since its inception in 1965. The Act was so unpopular that in 1989 congress rescinded the whole thing and it was quietly placed in the dust bin of history. Today we often hear commentators and other so called experts say it is the law of the land so learn to live with it, giving the impression that laws cannot be changed. It has happened before so it is not impossible

War

I listened to Secretary of State John Kerry’s speech yesterday and was struck by the many times he spoke of killing with chemicals. Here is one example: The indiscriminate slaughter of civilians, the killing of women and children and innocent bystanders by chemical weapons is a moral obscenity. If I substitute the word bombs for chemical weapons it illustrates the disconnect we seem to have regarding death of innocent people. I believe that we make this distinction to justify past actions taken by the so called civilized societies. Recall that during WW11 the allies fire bombed cities in Japan and Germany deliberately targeting civilian populations with the goal of demoralizing the enemy and it worked. It likely shortened the war and saved the lives of many on the side of the allies. I point this out to illustrate the twisted logic needed to rationalize behavior especially when it comes to war.

Weather

It appears that one of the most favorite topics of conversation, the weather, is losing its pizzazz, at least for the weather man. In order to juice up the news worthiness the experts have come up with the heat index and the wind chill. This allows them to say that 95 above is really 105 above and 25 below is really 35 below. Well now I notice that these new designations have lost some of their shock power, so I propose we have a couple of new categories called super wind chill and super heat index and that way the TV people can regain some of their lost audience. Just think of how exciting it would be to talk about 120 above. That would certainly make me feel better. What about you?

religious beliefs

When it comes to religious beliefs, I can understand that people have different views and I am generally tolerant of most of these views. I understand the agnostic, the person who says that the existence of God can neither be proved nor disproved and I understand the person whose belief in God is based on faith and needs no proof but I am at a loss to explain the atheist who says there is no God. My guess is that there are atheist who buy lottery tickets, even though the odds of winning might be 100 million to one but I don’t think anyone including an atheist would buy a ticket if they knew they could not win. We are all in agreement that no one knows for sure if there is life after death but why not believe that there is? We have all been given a free will to think as we please and given the choice why not believe that there is a heaven after death. Could it be that their egos are so powerful that they refuse to give up control to a power outside of themselves?

Listening in

Friday 7 June In his first remarks since the Guardian and the Washington Post's revelations, Obama gave a frank rebuttal to privacy concerns. "Nobody is listening to your telephone calls," the president said when asked about the NSA. Monday 17 June Obama defended the NSA program in an interview with Charlie Rose. The president insisted the NSA was "transparent". "What I can say unequivocally is that if you are a US person, the NSA cannot listen to your telephone calls, and the NSA cannot target your emails … and have not," Obama said. Tuesday 6 August Two months after the initial NSA revelations, Obama accepted the NSA had "raised a lot of questions for people" in an interview on NBC's Tonight Show, but insisted surveillance programs did not target US civilians. Friday 9 August "It's not enough for me, as president, to have confidence in these programs. The American people need to have confidence in them as well," Obama said in a speech at the White House, hours after the Guardian revealed that an NSA loophole did allow for warrantless searches of databases for US citizens' emails and phone calls Saturday 10 August The National Security Agency has acknowledged in a new classified briefing that it does not need court authorization to listen to domestic phone calls, a participant in the briefing said. Rep. Jerrold Nadler, a New York Democrat, disclosed on Thursday that during a secret briefing to members of Congress, he was told that the contents of a phone call could be accessed "simply based on an analyst deciding that." Do you think anyone is listening to phone conversations? Stay tuned!

WMD

In previous notes, I pointed out that Iraq received thousands of tons of chemical weapons from about dozen different countries including the US. In the months leading up to the Iraq war truck convoys were observed moving products to Syria. A Russian General was on the scene supposedly to make sure there was no trace of Russian activity in the transferring of these materials. It was at this time that Saddam was to explain how he had destroyed his chemical weapons but he would not say where this was done, since soil samples in that area would reveal whether it happened on not. I mention this because if Syria falls, the inspection of chemical weapons will reveal their source and perhaps finally answer the question as to what happened to Iraq’s chemical arsenal.

Money supply

Many of my friends have not studied Economics and most of those who did have forgotten most of what they learned. One of the terms used in economics is money supply. This refers to the amount of money in circulation including cash, checking and savings and the velocity of money refers to how many times each dollar is spent. If you multiply the money supply times the velocity you get the GDP. The government has three ways to influence the money supply. The first is when the government buys or sells government bonds. If they sell bonds they take money out of the system and if they buy bonds they add money to the system. The second way is to change the discount rate. This is the rate that banks pay to get money from the government. If they lower the rate the banks get more money and if they raise the rate the banks get less money. The third way is to change the reserve requirements. This is the amount of cash banks must keep on hand to back up their loans in case of default. The current requirement is 3 to 10 percent depending on the size of the bank. The reason I bring these things up at this time is to understand why the money supply is not increasing at the expected rate. Under normal conditions when the government buys a bond from a bank and deposits $1,000 in the bank, the bank can then loan out $10,000 and that is how banks increase the money supply. Banks are not making loans. They are investing the money in various vehicles and making a sizable profit. They are taking greater and greater risk with these investments knowing that if they guess wrong the government will come to the rescue. Bank reserves are increasing and bank stocks are rising but if things turn, which often happens, the taxpayer will once again have to ante up. In the meantime the bank stockholders are making money as are the bank executives. This is from an article dated May 16, 2012. May 16 (Reuters) - Big banks are expected to use a larger portion of profits for employee bonuses this year, despite extensive job cuts and a recent outcry from shareholders over excessive pay, according to a closely watched survey of Wall Street compensation.

Health care

If you are interested in one more example showing that the elected officials who designed Obamacare did not know what they were doing, here is the latest. Officials are concerned that young healthy people are not interested in signing up for health care and this is the group whose premiums were expected to offset the cost of covering those with pre-existing conditions. If they had asked anyone who was in the business of selling health care they would have discovered that these sales people do not even waste their time on contacting young singles as they are well aware these people are not good prospects. The penalty for these young people who refuse to get health care is $100 per year and they will just pay that. The penalty does increase to $625 by 2014 but that will still not do it. When people file their federal income tax in April of 2104 there will be a question asking if the person has health care and they will be required to submit proof. If they cannot they will be charged the penalty. One more addition to our tax forms is just what we needed.