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By Angela Hart
California would have to find an additional $200 billion per year, including in new tax revenues, to create a so-called “single-payer” system, the analysis by the Senate Appropriations Committee found. The estimate assumes the state would retain the existing $200 billion in local, state and federal funding it currently receives to offset the total $400 billion price tag.
The cost analysis is seen as the biggest hurdle to creating a universal system, proposed by Sens. Ricardo Lara, D-Bell Gardens, and Toni Atkins, D-San Diego.
It remains a long-shot bid. Steep projected costs have derailed efforts over the past two decades to establish such a health care system in California. The cost is higher than the $180 billion in proposed general fund and special fund spending for the budget year beginning July 1.
Employers currently spend between $100 billion to $150 billion per year, which could be available to help offset total costs, according to the analysis. Under that scenario, total new spending to implement the system would be between $50 billion and $100 billion per year.
“Health care spending is growing faster than the overall economy … yet we do not have better health outcomes and we cover fewer people,” Lara said at Monday’s appropriations hearing. “Given this picture of increasing costs, health care inefficiencies and the uncertainty created by Congress, it is critical that California chart our own path.”
The idea behind Senate Bill 562 is to overhaul California’s insurance marketplace, reduce overall health care costs and expand coverage to everyone in the state regardless of immigration status or ability to pay. Instead of private insurers, state government would be the “single payer” for everyone’s health care through a new payroll taxing structure, similar to the way Medicare operates.
Lara and Atkins say they are driven by the belief that health care is a human right and should be guaranteed to everyone, similar to public services like safe roads and clean drinking water. They seek to rein in rising health care costs by lowering administrative expenses, reducing expensive emergency room visits, and eliminating insurance company profits and executive salaries.
In addition to covering undocumented people, Lara said the goal is to expand health access to people who, even with insurance, may skip doctor visits or stretch out medications due to high copays and deductibles.
“Doctors and hospitals would no longer need to negotiate rates and deal with insurance companies to seek reimbursement,” Lara said.
Insurance groups, health plans and Kaiser Permanente are against the bill. Industry representatives say California should focus on improving the Affordable Care Act. Business groups, including the California Chamber of Commerce, have deemed the bill a “job-killer.”
“A single-payer system is massively, if not prohibitively expensive,” said Nick Louizos, vice president of legislative affairs for the California Association of Health Plans.
“It will cost employers and taxpayers billions of dollars and result in significant loss of jobs in the state,” the Chamber of Commerce said in its opposition letter.
Underlying the debate is uncertainty at the federal level over what President Donald Trump and the Republican-controlled Congress will do with Obamacare. The House Republican bill advanced earlier this month would dismantle it by removing its foundation – the individual mandate that requires everyone to have coverage or pay a tax penalty.
Republican-led efforts to repeal and replace Obamacare is fueling political support for the bill, Atkins said at a universal health care rally this past weekend in Sacramento hosted by the California Nurses Association, a co-sponsor.
“This is a high-ticket expense … We have to figure out how to cover everyone and work on addressing the costs in the long-term – that’s our challenge,” Atkins said. “I’m optimistic.”
The bill has to get approval on the Senate floor by June 2 to advance to the Assembly. A financing plan is underway, which could suggest diverting money employers pay for workers’ compensation insurance to a state-run coverage system.
Lara said he believes California can and should play a prominent role in improving people’s lives.
“We can do better,” he said.
By Katie Mchugh
“Taxpayers in counties that backed Trump would see an annual windfall of about $6.6 billion, a Bloomberg analysis of Internal Revenue Service data shows. In counties that backed Clinton, it’d be about $21.9 billion,” Bloomberg explains, since the tax cuts in Obamacare 2.0, championed by House Speaker Paul Ryan, apply to couples earning over $250,000 and individuals earning over $200,000. Blue counties like Manhattan, filled with high-earners, would be able to avoid an additional Medicare tax under Ryan’s plan.
That’s not a surprise. Clinton’s support came from counties where large amounts of money flowed in and out, where the “winners of globalization” clustered, as Christopher Caldwell explained in the Claremont Review of Books:
Any place that has political power becomes a choke-point through which global money streams must pass. Such places are sheltered from globalization’s storms. They tend to grow. Austin, Texas, adds tens of thousands of residents a year, and is now the country’s 11th-largest city. The four richest counties in the United States are all in the suburbs of Washington, D.C. Resources are sucked from almost everywhere into political capitals and a few high-tech centers and university towns allied with them, where ambitious people settle and constitute a class. The Democratic Party is the party of that class, the class of the winners of globalization.
There are now just three regions of the country in which Democrats dominate—New England, California, and the Pacific Northwest. Otherwise, the party’s support comes from the archipelago of powerful New Economy cities it controls. Washington, D.C., with its 93-to-4 partisan breakdown, is not that unusual. Hillary Clinton won Cambridge, Massachusetts, by 89 to 6 and San Francisco by 86 to 9. Here, where the future of the country is mapped out, the “rest” of the country has become invisible, indecipherable, foreign.
Trump’s sprawling base of support spans across the country: The losers of globalization. As Michael Patrick Leahy reported at Breitbart News shortly after the election: “Donald Trump won an overwhelming 7.5 million popular vote victory in 3,084 of the country’s 3,141 counties or county equivalents in America’s heartland… Hillary Clinton, in contrast, had an 8.2 million vote margin in a narrow band of 52 coastal counties and five ‘county equivalent’ cities stretching from San Diego to Seattle on the West Coast and Northern Virginia to Boston on the East Coast.”
And, Obamacare 2.0 wouldn’t let many Trump voters to keep more of their money. Earlier, the Washington Post reported that Michigan, Pennsylvania, and Wisconsin will see their tax credits decrease under Obamacare 2.0: “If you’re a 40-year-old making $75,000 a year, you’re going to get a 75 percent or higher increase to your tax credits—a beneficial situation for you. If, however, you’re a 60-year-old making $30,000 a year, you’re going to see a reduction in those tax credits (unless you live in Upstate New York or Massachusetts or parts of central Texas).”
The Congressional Budget Office also estimates that Obamacare 2.0 could cause up to 24 million to lose their health insurance plans by 2026.
Obamacare 2.0 also includes an arbitrary “continuous coverage” provision that inflicts a year-long, 30 percent increase as a penalty on those who go without insurance for more than 63 days. That will take money from middle class voters and put it in the hands of insurance companies. Utah Republican Rep. Jason Chaffetz sparked an uproar after he called this wealth transfer “an investment” that voters should make over buying a new iPhone.
Massive wealth disparities and concentrated wealth at the top of society have led to growing political unrest, said Fox News host Tucker Carlson earlier this week.
“But the overview here is that all the wealth, basically, in the last 10 years, has stuck to the top end. That’s one of the reasons we’ve had all the political turmoil, as you know,” Carlson said. “And so, kind of a hard sell to say ‘Yeah, we’re gonna repeal Obamacare, but we’re gonna send more money to the people who’ve already gotten the richest over the last 10 years.’ I mean, that’s what this does, no? I’m not a leftist, it’s just—that’s true.”
“I’m not that concerned about it,” Ryan said. Ryan may not be interested in political upheaval, but it’s interested in him. Passing Obamacare—and the stimulus package—led to the Tea Party revolt in 2010. Enormous Obamacare premium increases revealed in October hurt Clinton’s campaign. Trump is more popular than Ryan in Ryan’s congressional district, while Obamacare 2.0 is unpopular: Only 37 percent support it, while 46 percent oppose it. The rumblings against the bill could cost Ryan his Speakership, or even his Congressional seat while handing power to Democrats.
Still, some voters feel ambivalent towards the tax cuts in Obamacare 2.0 and still support Trump.
“It pisses me off, but my wife pisses me off, too, and we’re still married,” one Trump supporter told Bloomberg.
Trump has also accused the media of turning the blind eye to this fact.
“The media has not reported that the National Debt in my first month went down by $12 billion vs a $200 billion increase in Obama first mo,” he said in his Twitter post.
He then added that he has “great optimism for future of the US business and jobs” and promised “big tax and regulation cuts.”
The figures presented by Trump coincide with the data issued by the US Treasury Department, according to which, on January 20th, the day of Trump’s inauguration, the overall US debt stood at $19,947 billion. On February 21st, a month later, the total US debt load amounted to $19,935 billion.
Moreover, between February 22 and February 23, the US debt fell by further $ 22 billion from $ 19,935 billion to $ 19,913 billion.
The US public debt really grew by more than US$ 200 billion from US$ 10,626 billion to US$ 10,838 billion in Obama’s first month in office, according to the US Treasury data.
According to the website USdebtclock.org, which tracks how much the US debt grows in real time, the debt had grown by $ 9 trillion or by 86 percent from $ 10.7 trillion to $ 19.6 trillion during Obama’s two terms in office, hitting a record high.
The largest budget item is Medicare/Medicaid which has seen over $1.1 trillion added to US debt. Social Security accounted for $900 billion, while $585 billion was spent on defense and war.
However, the New York Times reported in 2009 that Obama banned four accounting gimmicks that President George W. Bush used to make deficit projections look smaller. This decision led to a situation, in which the spending seemed to grow to a larger degree previously.
Trump’s statements come just a day after the Council on Foreign Relations predicted that “Trump’s policies would be likely to significantly widen the budget deficit.”
In November 2016, after the US elections, the Tax Policy Center (TPC) also said that the federal debt would rise by $7.2 trillion n ten years and by $20.9 trillion by 2036.
Trump vowed to reduce the US debt and to eliminate deficit spending during his presidential campaign. On Wednesday, he once again addressed this issue and pledged to make Washington stop wasting taxpayers’ money.
“The finances of our country are a mess, but we’re going to clean them up,” the president said, adding that “we won’t let your money be wasted anymore.”
“We must do a lot more with less,” he said.
By Jeff Poor
However, those critics are still arguing the money put toward the project would be a waste.
The main question now is how the government will pay for it, to which Trump had said throughout the 2016 presidential campaign that Mexico would be responsible for the project’s financing.
Assuming the cost is on the high end of those estimates at $15 billion, the total cost of the border wall would constitute nearly 0.4 percent of the federal government’s $3.8 trillion FY 2015 budget.
While there are many other big ticket items on the federal budget, many of them dwarf the cost of a U.S.-Mexico border wall. Here are a few:
1) The War on Poverty: On the 50th anniversary of the so-called War on Poverty in 2014, the Heritage Foundation’s Robert Rector estimated taxpayers have footed a $22 trillion bill for the effort.
As Rector also points out, however, is that in that 50-year timespan, the poverty rate was the same that was when President Lyndon B. Johnson began the “war on poverty.”
“The U.S. Census Bureau has just released its annual poverty report,” Rector wrote. “The report claims that in 2013, 14.5 percent of Americans were poor. Remarkably, that’s almost the same poverty rate as in 1967, three years after the War on Poverty started.”
In case you were wondering, the cost of this ongoing war would be enough to foot the bill for 1,466 border walls.
2) The Lockheed Martin F-35 Stealth Fighter Jet Project: According to Reuters, the cost to build the fighter jet program is estimated to be $379 billion, which would be roughly the cost of 25 border walls.
Back in December in a tweet, Trump criticized the costs of the project, which have been plagued with problems and cost overruns, and said he was asking Lockheed Martin competitor Boeing to price out a similar project.
Early on, some anticipated that throughout the lifespan of the F-35, the federal government could spent up to $1 trillion overall in building the fighter jet and for its maintenance.
3) A Day and a Half of Running the Federal Government: The federal budget is currently around $3.8 trillion. If you take there are 365 days in a year, 24 hours in a day and 60 minutes in an hour, that comes to a total of 525,600 minutes per year. Divide that $3.8 trillion by 525,600 and you will find the U.S. government spends about $7.2 million per minute.
At $7.2 million per minute, that is $432 million per hour and nearly $10.4 billion a day. With the wall at a cost of $15 billion, that would be roughly a day and a half of operating the federal government as a whole.
4) Medicare, Medicaid Improper Payments: A 2015 Government Accountability Office report estimated in 2014 the federal government made $59.9 billion in improper Medicare payments and $17.5 billion in improper Medicaid payments for a grand total of $76.4 billion, or roughly the cost of five border walls.
That same report found that when the $76.4 billion figure was combined with 122 programs, including the EITC, that number in FY 2014 comes out to $124.7 billion in improper federal government payment, which was up from $105.8 billion a year earlier.
5) Maintenance of Vacant and Unused Properties: The federal government reportedly spent $25 billion annually in 2009 on maintaining vacant and unused building.
The figure was cited in a 2009 Heritage Foundation report, which was calculated by then-Senate Oversight Subcommittee chairman Sen. Tom Coburn (R-OK):
Unused Federal Property:
- $25 billion wasted per year in unused federal property. (At $21 per square foot occupancy cost, 1.186 billion square feet of excess space)
- Federal buildings worth tens of billions of dollars sit empty around the country. The Office of Management and Budget (OMB) has set a goal of reducing the inventory of all real property by 5%, or $15 billion, by 2009. Based on this goal, it appears that OMB considers this amount– at the very least—to be excess.
- DoD spends $3-4Billion on maintenance of unused buildings each year.
The figures have been revised downward over the year, to $8 billion in 2013 and to $1.7 billion in 2016. However, the cumulative amount over the past decade would have been more than enough to finance a border wall.
6) The Littoral Combat Ship Program: The U.S. Navy’s controversial Littoral Combat Ship program comes in with a price tag of $29 billion.
The project, which includes ship prototypes built in Mobile, AL and Marinette, WI, has been fraught with problems and targeted for those problems and cost overruns on a bipartisan basis by the ranking members of the Senate Armed Services Committee, chairman Sen. John McCain (R-AZ) and ranking Democrat Sen. Jack Reed (D-RI).
“Until these actions are taken, we will have significant concerns about supporting the procurement of additional LCSs,” McCain and Reed wrote to Navy officials last fall in a letter according to Bloomberg News.
7) Earned Income Tax Credit Program Improper Payments: The Earned Income Tax Credit (EITC) is regarded by its critics as nothing more than wealth transfer program that exists under the guise of eliminating poverty.
According to the Brookings and Urban Institutes’ Tax Policy Center, in 2015 the ETIC provided an estimated $69 billion in benefits to 28 million recipients.
However, as the Washington Examiner’s Byron York pointed out, the Treasury Inspector General for Tax Administration stated, “The IRS estimates that 23.8 percent ($15.6 billion) of EITC payments were issued improperly in Fiscal Year 2015.”
At $15.6 billion, that is roughly the cost of the border wall.
8) U.S. Postal Service: Even though the postal service generates revenue by charging for certain services, it still loses money that is absorbed by the taxpayer.
The U.S. Postal Service has fallen on hard times given more efficient means of communication have replaced the need for the agency’s first-class mail.
For FY 2012 alone, the USPS lost $15.9 billion. Although they have shrunk over the last four years, the agency has continued to post losses, including $3.9 billion in 2013, $5.5 billion in 2014, $5.1 billion in 2015 and $5.6 billion in 2016 for a grand total of $36 billion since 2012.
The USPS also enjoys a federal government-imposed monopoly on access to mailboxes and is exempt from local regulations and taxes that its privatized competitors do not enjoy.
A sizable chunk of that budget is dedicated to the agency’s Earth sciences division estimated at $2 billion, which has been at the forefront of climate change research.
However, a recent Guardian article by Oliver Milman anticipates funding on climate change to stripped and rededicated to deep space exploration under President Trump.
For the time being, NASA has been reliant upon the Russians to send U.S. astronauts to the International Space Station, which came at a $457.9 million cost in 2014.
10) Farm Subsidies: According to Chris Edwards of the Cato Institute, the federal government through the Department of Agriculture spends at least $25 billion on farm subsidies.
“The particular amount each year depends on the market prices of crops and other factors,” Edwards wrote last October for DownsizingGovernment.org, a project of the Cato Institute. “Most agricultural subsidies go to farmers of a handful of major crops, including wheat, corn, soybeans, rice, and cotton. Roughly a million farmers and landowners receive federal subsidies, but the payments are heavily tilted toward the largest producers.”
To Edwards’ point, farm subsidies often go to those not necessarily of financial assistance from the government. Among those receiving those subsidies according to a 2015 Economist magazine piece are Walmart heirs Alice, Jim and Rob Walton, rockers Jon Bon Jovi and Bruce Springsteen and CNN founder Ted Turner.
BY AMY MORENO
Well, now, he and Senate Majority Leader McConnell are threatening to block Trump’s spending plan.
The bill included funding for Obama’s controversial amnesty program and Obamacare.
So, now these two dopes are going to get “tough?”
In the afterglow of Donald Trump’s unexpected triumph, Republicans exulted over what they could accomplish with control of both chambers of Congress and the White House.
But behind the public show of unity, a stark difference looms. House Speaker Paul Ryan is a fiscal hawk who wants to couple tax cuts with deep spending cuts. Trump catapulted himself into the presidency talking about tax cuts too, but he also is proposing a multibillion-dollar infrastructure plan and has vowed to protect entitlement programs like Social Security and Medicare.
Such gaps went unmentioned when Trump met with Ryan and Senate Majority Leader Mitch McConnell last week. But ultimately, one side will have to bend, whether Trump ends up moderating his spending and tax-cut plans, or congressional fiscal hawks relent on their opposition to new spending.
The signs of a looming clash are already there. One day after meeting with Trump, McConnell poured cold water on Trump’s spending plans, telling reporters that a government stimulus wasn’t going to help the economy.
“A government spending program is not likely to solve the fundamental problem of growth,” he said Friday.
But Trump mentioned only one policy proposal during his victory speech last week: his infrastructure plan.
“We are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals. We’re going to rebuild our infrastructure, which will become, by the way, second to none,” he said. “And we will put millions of our people to work as we rebuild it.”
Such a plan may be too much for congressional Republicans to swallow, and Ryan and McConnell haven’t backed it.
But House Majority Leader Kevin McCarthy of California showed some softening on the issue Monday, telling reporters that an infrastructure bill can be “a priority” and “a bipartisan issue.” He said there can be ways to pay for it, though he didn’t provide specifics.
“Infrastructure in America is lagging far behind,” McCarthy said, noting that Congress passed a highway bill this year for the first time in more than a decade.
Anthony Scaramucci, an economic adviser named to Trump’s 16-member transition executive committee, cited the president-elect’s $1 trillion infrastructure plan, saying it would be financed by “historically cheap debt” and private-public partnerships.
“We can close the wealth gap in America by replacing emergency-level interest rates with fiscal stimulus,” Scaramucci, the founder of the investment firm SkyBridge Capital, wrote in an op-ed in the Financial Times last week.
Ryan and House Republicans have spent the past six years enforcing strict budget caps aimed at holding down the federal debt. Republicans even took the government to the brink of default in a battle over raising the debt limit.
“As we move from campaigning to governing, something will have to give since cutting taxes without major spending cuts will make our already unsustainable debt situation even worse,” says Maya MacGuineas, president of the non-partisan Committee for a Responsible Federal Budget in Washington.