Healthcare

New revelations regarding the rising cost of Obamacare surface almost daily and I am totally amused at the surprise expressed by the news media. They must be the same people who thought we were going to insure 31 million new people at no cost. It is possible that the news people were so in favor of health care for everyone that they were willing to overlook the cost issue.

Shirts

In the news this week is the story of the building in Pakistan that collapsed. The building house garment workers who were making clothes sold mostly in the USA and Europe. The company neglected to take proper care of the building in order to save money so they could sell at a low price. Some here in the US are now blaming US companies for demanding such low prices and saying that these companies are partly responsible for the problem. I scanned the Internet but could not find any studies done in regards to the morality of purchase decisions by consumers. I wonder what would happened if a consumer was presented with two identical shirts one marked five dollars and made by slave labor in Pakistan and one marked seven dollars and made by responsible companies in Turkey.

Student loans

The student loan program started in 1965 was handled through banks but the money was always government money. The banks would take government money at a low rate and loan it to students at a higher rate, a typical bank activity. President Obama decided that the government should eliminate the banks from this equation and pass the savings along to the students but the interest rates at 6.8% is still high. The rate was 6.8% when the government took over and the rate went down to 3.4% but now it is back up to 6.8%. What happened? Instead of the money being used to keep student loan interest rates down it is being used for other purposes, one of which is Obamacare.

Geithner

There are millions of small business owners and millions of others who work as individual contractors. This means, among other things that they must pay self-employment tax. For most people who work for someone else this is not a concern because your employer will withhold 7.65% of your salary as payroll tax. Payroll tax is 6.2% for social security and 1.45% for Medicare. The employer matches that 7.65% so the government gets 15.3% of your salary. Now take the case of the former Secretary of Treasury Tim Geithner. He was working for the IMF and was considered an independent contractor. They told him when he started that he would be responsible for paying the 15.3% payroll tax but they unlike most employers gave him extra money to pay for this tax. When he filed his taxes in years 2003 and 2004 he failed to pay this tax and when he was caught he agreed to pay the back taxes plus interest. He said he was not aware of the mistake. A year later he was notified that he also failed to pay this tax for tax years 2001 and 2002. To get a perspective on the amount of money we are talking about, assume that his salary was $100,000. They gave him an extra $15,300 to pay this, which he kept and then did not pay the $15,300 he owed, meaning he ended up with $115,300 instead of $84,500. A nice tidy sum I would say. Let’s be generous and say he forgot the first time but did he not think about the earlier years!

Midlife

I am writing this in response to a young friend of mine who asked for my thoughts on the subject of mid-life crisis. To begin with, it is only a crisis if it comes unexpected but can be a rewarding experience if it is properly understood. The basis for this mid-life transition starts before birth with the understanding that each person gets half of their chromosomes from their mother and half from their father. Psychologist Carl Jung brought this to my attention when he spoke of the anima and animus. These are Latin terms he used to describe the masculine and feminine side of each person. He chose those words so people would not confuse masculine with male and feminine with female. This is critical to grasping Jung’s concepts of masculine and feminine characteristics. These are traits that are more common in one gender verses the other but they are by no means limited to that gender. It merely means that if you interviewed a large number of people you would find that one trait is more characteristic to one gender. Some examples are competitive vs co-operative, aggressive vs assertive and analytical vs intuitive. This does not mean that there are no aggressive women but that it is more generally found among males. If we are born with equal numbers of chromosomes then, in the case of the male, what happens to the feminine traits? A baby does not realize that he is an individual until about the age of one or so. Up to that time he thinks he is part of his mother. When he begins to realize that he is different he starts the long journey of differentiating himself which continues until mid-life. At a very young age he understands that he is not like his mother but is in fact more like his father. This is reinforced daily by other family members and other relatives. He is treated like a male, dressed like a male and expected to act like a male. This reinforcement continues with neighbors, teachers, coaches and other members of society with whom he comes into contact. During the first half of life his masculine side grows in maturity while his feminine side remains underdeveloped and at mid-life it is time for him to reconnect with the inner feminine and become the whole person he was meant to be. It is this process of reconnecting that opens the door to a whole new world for the man who is ready to look inward and welcome his other half into his life. She brings with her a glorious new world filled with adventure and surprise. Nature in her wisdom, brings about a reduction in testosterone at this very time which aids in the transition. For the man who is ready for this change the world takes on a more profound meaning and rewards him with a greater understanding of human nature. It is a time of emotional and spiritual growth and makes the second half of life the best half.

Political influence

Most Americans are familiar with Political Actions Committees (PACS). These are groups headed up by a lobbyist that represent different interest. For example some well-known groups are the pharmaceuticals, AARP and the National Rifle Association (NRA). These groups provide a valuable service to elected officials, in particular, congressmen in Washington. They explain their positions on complicated issues saving time for the congressmen. Before they can present their case they must have access to the elected official and this is where the controversy begins. In order to get the attention of a congressman these groups help with campaign financing and this is where many people think that congress votes based on these contributions. Upon further investigation it can be shown that votes are not always influenced by these monies. Take the example of the steel lobby vs the auto lobby. Steel wants import taxes to keep out the competition which keeps prices up but the auto people oppose such measures and want to keep prices down. Both of these industries have lobbyist and both try to influence the congressmen. If that congressman represents a district where there are lots of steel industry jobs he may vote in their favor but if he is in a district with many auto jobs he likely will vote in that direction. In either case he is voting the needs of his constituents. This does not mean that the system in not abused as sometimes the group with the most money has the most influence. Other times the group with the most voters can sway the congressman. Such groups like AARP, NRA and unions can bring many voters to the polls and they have influence without offering money to the congressmen. And, of course some groups use both voters and money. The point is that just because a congressman accepts money does not mean he is selling his vote.

Corruption

During the past 40 years the inflation adjusted income for the middle class rose 65% while the income for the top 1% rose 275%. If this were the free market working independently, I would not object but forces are at work that cause the field to be tilted in favor of the rich. These range from political influence to insider information to outright corruption. This is what the Tea Party and the Occupy Wall Street people object to and efforts should be made to resolve these problems. It is the middle class where the income increases are not what they seem. The 65% figure is based on family income and much of that has come from the fact that we now have more two income families in the middle class. Were it not for women entering the work force the figures for the middle class would be less favorable. There will always be disparities in income distribution and that is as it should be but corruption should not be part of the calculus.