The Simple Dollar Weekly Roundup: David Cameron Edition

I tend to follow the politics of the United States, Canada, Mexico, and Great Britain very closely (I’m kind of a political junkie).

So, in that spirit, I truly wish David Cameron the best of luck as the new prime minister of Great Britain. The people have spoken and it was time for Labour to go. I might not necessarily agree with everything that is on his agenda, but I sincerely hope that he has success.

I’m of the belief that, regardless of my own political stances, it’s in the best interest of a nation to support the leadership that the nation has elected. The time to make a change is the next campaign season, not by sandbagging during the time when leadership and legislation needs to happen. When the people speak and elect someone, he or she has a mandate to lead and get their initiatives passed.

I do sincerely hope, however, that his government (with a healthy number of Liberal Democrats in there) turns into a bit of a “team of rivals,” helping Great Britain as a whole.

Good luck, David.

How to Finish What You Start The sign of success isn’t the number of big initiatives you start. It’s the number of big initiatives you finish. (@ dumb little man)

Do You Work On The Weekends? I do, to a degree. I’ll write while the children are napping on weekends or check up on email when everyone else is in bed, for example. (@ freelance switch)

Ask the Readers: Am I Being Foolish for Saving So Much? You’re only foolish for saving too much if you’re denying yourself something that you really value in your life because of that savings. (@ get rich slowly)

Evicting Justin Case The problem with “Justin Case” is that he often lives in storage lockers, adding to your monthly bills. (@ unclutterer)

The Depends Dilemma: Why I Buy Items I Won’t Use I found this article utterly fascinating, though the title is a bit misleading. If I had a coupon for free Depends, I’d probably pick up that package, then drop it off at a local food pantry or retirement home when I was in the area. I see no reason not to take things you’re given for free and give them to charity. (@ money saving mom)

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  1. Claudia says:

    EXCELLENT post on the politics Trent!

    “I’m of the belief that, regardless of my own political stances, it’s in the best interest of a nation to support the leadership that the nation has elected.”

    I could not agree more with this statement.

  2. Nice comment on the UK election, Trent. As an American living in England, I find the politics here fascinating!

  3. Geoff says:

    As a Brit living in the US and in my early 30′s, I find my homeland political system very interesting. Having never even heard of a hung Parliament and certainly never living through one, this past week has been an education. The newly formed coalition is fascinating. Although I would never have voted Conservative (probably more Lib Dem although I believe I voted Blair back in 97), I am looking forward to seeing how this plays out.
    Great post Trent.

  4. Kate says:

    I’m really interested in seeing how things play out in the UK too. Here in Canada, we’ve had a “hung Parliament” for years now and it’s been a disaster. There’s healthy competition and there’s all-sides-trying-to-score-stupid-points-all-the-time-and-refusing-to-play-nice-and-get-anything-done.

  5. sg says:

    The thing to watch out for, as far as the new UK government goes, is the parties’ ability to get along over Europe. The Tories were out of office for 13 years in large part because of their inability to figure out a coherent message on Europe (former Tory party chairman Norman Fowler’s book A Political Suicide: The Conservatives’ Voyage into the Wilderness is excellent reading material on this subject), and their self-destructive Europhile/Eurosceptic factionalism has not been solved during their time out of office — it’s just been swept under the carpet. And the Lib Dems, who are historically pro-Europe, are not going to like being trampled on by the strongly Eurosceptic factions within the Conservative Party. With the current woes over the fate of Greece and other struggling Eurozone economies, this coalition has its work cut out for it to avoid serious problems over European issues, especially the hot-button topic of immigration of Eastern Europeans (which nearly wrecked Gordon Brown’s public image during the campaign).

    It’ll be interesting to watch, if nothing else.

  6. Matt says:

    “I might not necessarily agree with everything that is on his agenda, but I sincerely hope that he has success.

    I’m of the belief that, regardless of my own political stances, it’s in the best interest of a nation to support the leadership that the nation has elected.”

    That’s exactly how the Germans thought when they initially elected Hitler…….

  7. Fernando says:

    Godwin’s Law.

  8. Stephan says:

    @Kate, thats what i fear will happen in england as well. and honestly, its what america has seen over the past few years as the country is really splitting along clear ideological and political lines. hopefully we can work together to solve the problems without letting politics ruin a great nation

    Preferred Financial Services

  9. Kat says:

    Matt, Hitler was never elected. It was very complicated (and mostly a lot of illegal activites, fires, threats, etc), but basically the Nazi Party got themselves into a sort of majority, then declared any other political party to be illegal. The elected president had made Hitler chancellor, and when the president died, Hitler basically used his position as chancellor to become the new leader. When Hitler had run for president before that, legally, he did not win (though just under a third of Germans did vote for him). It’s interesting to learn about, and I am sure outside of the scope of a finance blog!

    I am sure Trent is referring to a fairly elected president/leader from a democratically held election, not a dictator who took the presidency by force.

  10. Johanna says:

    Well, what does “support the government” really mean?

    If it means not speaking up against positions and policies that you disagree with, then no, I don’t think citizens have any responsibility to do that. I don’t see what there is to gain by confining the expression of political opinions to election season.

    I do, however, think it’s just childish to try to shout down the party in power to keep them from doing anything at all – even things that you would have agreed with, or wouldn’t have cared about much at all, had they been done when your party was in power. So if supporting the government just means not doing that, then I’m on board with that.

  11. Adam says:

    Wow, Trent you caught me by surprise talking about UK politics :)
    Thanks for your support. The liberals may have been 3rd but they had almost 25% of the vote (the first past the post system meant they got only a tiny number of seats) so I’m pleased that the coalition means they are more strongly represented than they have been for most of the 20th century.

  12. Eric says:

    Godwin’s Law wins again!

  13. Chef-brian says:

    Perhaps you could post a link to your post wishing President Obama well when he assumed the presidency

  14. Wendy says:

    I like your interest in our politics Trent! I think a ‘coalition government’ (its not being called a hung parliament anymore) could be a really good thing for this country. If it was Labour-Conservative then we would have LOTS of problems, but with it being Conservative-Lib Dem then hopefully the Conservatives will be mellowed by the Lib Dems and the Lib Dems will be tempered by the Conservatives. As the Lib Dems have not had any sort of power since the 1930s, I reckon they will be more keen to bring about real change than ‘scoring points against each other’ so that they stand more of a chance in the next election – at the moment, many people just write them off as a very weak party

  15. deRuiter says:

    “I’m of the belief that, regardless of my own political stances, it’s in the best interest of a nation to support the leadership that the nation has elected.” Lovely belief, touching, moderate, centrist, pointless. If the legally elected government is subverting the Constitution of the United States, then it is better NOT to support them. Also, it’s all well and good to airily say, “Good luck, David.” In this case, luck will have nothing to do with ending the continued freefall of the British economy. How fascinating Trent, that you did not comment about the problems facing the British Government being caused by over spending, liberal social programs which give away more than the British economy can generate and suck away the desire of the British working person to work instead of living forever on the dole. Unless the Brits stop the social welfare programs, stop spending, cut back radically, they are doomed. Why was it that Communist countries had to put a wall around their countries to keep people IN? And when the wall fell, people streamed out of the Communist / Socialist utopias and begged for Western goods, services and laws? It is because people do not want to have their earnings taken from them to give to the non productive.

  16. Gillian says:

    “and suck away the desire of the British working person to work instead of living forever on the dole.”

    Have you ever been on the dole? I have. You can’t ‘live’ on it. You can exist – if you can manage to pay all your utility bills, travel and feed yourself on £30 per week – but you can’t ‘live’. And to suggest that people actively want to be ‘living forever on the dole’ is very insulting to those desperate for a job and worried about how they’ll manage to pay the rent. (Even when you get a job, housing benefit stops the minute you’re in work. Not the minute you get your first paycheck.) We have systems in place to help out those unable to pay for basic services, and I am very proud to live in a country that does so. If I was poor in America I’d be terrified every time I got toothache or had a pregnancy scare.

    I presume from your comment that you are American – I’m not sure this gives you enough insight to know what the fate of the ‘British working person’ is, and I imagine Trent has chosen not to comment on these issues for the same reason. We have high unemployment and high prices at the moment. It’s difficult for everyone. I earn significantly more than I did three years ago, but I don’t see a difference, because things are more expensive.

    “If the legally elected government is subverting the Constitution of the United States, then it is better NOT to support them.”

    We don’t have a Constitution in the UK.

    “It is because people do not want to have their earnings taken from them to give to the non productive.”

    I pay taxes. These taxes pay for many services I don’t use. One day, you might have to claim unemployment benefit, and you’ll be very glad you paid that portion of your taxes. The ‘non productive’ I resent giving money to are non-doms and other tax avoiders (Zac Goldsmith being a good example) who can fine well afford to pay their share.

  17. London student says:

    Trent it makes my day that you follow British politics! Thanks for the regards for our country which is sort of pushing through these hard times and very appreciative of your mention on this website. Wasn’t sure how many UK readers you had but I am certainly your No1. fan in the UK.

    I was truly surprised to see David Cameron edition pop up on my google reader!!

  18. Johanna says:

    I don’t agree with deRuiter’s analysis of British economics/politics, but he (or she?) does have one good point: It’s interesting that a self-described “political junkie” who’s been following the situation “very closely” has nothing more to say than, “Hey, there was an election and somebody won!” Nothing at all about the issues involved in the election, why the British people might have thought it was “time for Labour to go,” or the similarities and differences you must have noticed between US and UK politics. I know this isn’t a political blog, but why bring up the election at all if you don’t have anything to say about it?

  19. Matt says:

    @Kat: Yeah, I agree. But the 16th Amendment was never legally passed, either. But it’s still there. I guess what I’m saying is that apathy leads to ultimate corruption, and the default of each American person is to challenge the government on anything unconstitutional, not just lend unwarranted support because the “majority” decided on someone. You know?

    That’s all I’m saying. I think post #8 and #10 say it well.

    And Post #11 makes very very valid points, too :)

  20. beth says:

    Sorry I missed the post where you wished our President Obama good luck.

  21. beth says:

    On July 12, 1909, the resolution proposing the Sixteenth Amendment was passed by the Sixty-first Congress and submitted to the state legislatures. Support for the income tax was strongest in the western states and opposition was strongest in the northeastern states.[20] New York Governor Charles Evans Hughes, who a few years later became a Supreme Court justice, opposed the income tax amendment. He believed “from whatever source derived” implied that the federal government would then have the power to tax state and municipal bonds, thus excessively centralize government power, and “would make it impossible for the state to keep any property”.[21]

    The presidential election of 1912 was contested between three advocates of an income tax.[22] On February 25, 1913, Secretary of State Philander Knox proclaimed that the amendment had been ratified by the necessary three-fourths of the states, and thus had become part of the Constitution

  22. AnnJo says:

    Trent, I have to agree with deRuiter that your statement about “supporting the leadership that has been elected” is a nice but hollow sentiment. I wonder if you really mean it.

    Let’s leave aside the fact that in the U.K.’s parliamentary system, David Cameron was not “elected” but was simply able to cobble together a coalition of enough MPs to obtain a partliamentary majority.

    We may choose our head of government differently, but in both the U.K. and the U.S., people elect representatives to REPRESENT them, whether the rest of the country elects representatives of the same party or not.

    If I don’t agree with Obama’s health care plan, for instance, and think it is bad for me or bad for the country or both, I want my representative to fight to the very best of his ability to stop it. I want him to use every legal and ethical means to do it, every parliamentary rule in the book, every right of filibuster, amendment, tabling, etc. If it is really true that 52% of voting Americans elected Obama because they predicted he would implement a health care plan totally different from the one he talked about in his campaign, at a cost vastly higher than he estimated, and they ALL really wanted that plan – a huge IF – then it is still my right and duty to try to oppose it and try to elect a representative who will stop it, and it is that representative’s duty to do his best to represent the people who elect him.

    One has to have an enormous ego to run for President or seek the Prime Minister’s position. Such people are likely to have social plans and ambitions just as enormous. A vigorous and vocal opposition is the best hope of moderating those ambitions, preventing wild swings of policy that destabilize a country (think Zimbabwe or Venezuela) and keeping the pace of change slow enough that the real results of policy changes can be assessed before the country or its economy is totally wrecked.

    I happen to like Cameron much, much better than Brown, and wish him well, but Labour MPs are well within their rights to push back on behalf of their constituencies.

    And if you watched the election returns, didn’t you just love that British reserve? In most of the constituencies (other than the Scottish ones), even after the winner was announced you couldn’t tell by looking at the candidates which one it was – they all had such great poker faces. Not at all the way American winning candidates react, with wide grins, punching the air over their heads with a fist, making the V for victory sign, etc.

  23. Mel says:

    @deRuiter (#10)
    I realise this is going way off-topic, but I really have to take exception to this: “It is because people do not want to have their earnings taken from them to give to the non productive.”

    The thing with Communism is that there were no “non productive” people. Everyone had a job, because the government gave them one. No matter how crap they were at it, they had to be employed (dissidents were often window-washers when they weren’t in prison or Siberian mines). If you were fired (very rare, from what I understand), you just went to the office and were assigned a new job. A lot of the wanting to get out had more to do with living in fear of the secret police (and btw, there was only one wall, and it was not around a country) than having “their earnings taken from them”. I’m certainly no expert, but I live in a post-communist country and 20 years on, some of the effects are still here, regardless of all the changes that have happened. (And interestingly, here at least the Communist party does still have reasonably strong support, it is currently the 3rd biggest party)

  24. Claudia says:

    We have great insurance pays 90% — but, my husband is getting shots for pain. No one bothered to mention to him that the shots were over $3,000 each and that the Dr, while working in a PPO facility is not a PPO provider, so we will be paying 30% of the $18,000 to date bill. Add this to my surgery, and my husband’s hospitalization and our savings account is getting very, very, low. Anyone who thinks we don’t need healthcare reform, has never had any major health problems.

  25. AnnJo says:

    @Claudia. Very sorry for your troubles. It was not my intent to start a debate about health care reform, but to highlight that those who oppose ANY policy of the party in power are entitled to have their voices heard and their views represented in the halls of Congress or Parliament. I don’t believe they are under any duty, as Trent suggested, to shut up and be quiet just because their party lost the top slot or has only a minority in the legislature.

    As an aside, I don’t know anybody who thinks we don’t need health care reform. The disagreement is always about what kind. Every change hurts some people and helps others. The most recent change may or may not be to your advantage, Claudia, but it will be to my disadvantage. We are each entitled to urge our representatives to act in our own selfish interests.

  26. Claudia says:

    Yes,unfortunately, most people do not want health care reform because of their own selfish interests. They are afraid they may have to pay more. Most are also ill informed about how the health care system works. Although, I have good insurance, many people don’t or have none at all. Most against health care reform are not informed about how health care works, they are afraid that their insurance will go up to pay for others. We already pay for those without insurance. A portion of the high healthcare costs are the result of uninsured who will not or can not pay their bills. No one should have to decide between health care or eating. I find it shameful that a country that is supposed to be as wonderful as America claims to be has such a poor healthcare system. I’ve worked in healthcare for over 15 years. Each state has Medicaid, and some states have assisted health insurance plans. However, each state is different in how these are run. Some states will cover children only, some will cover adults only if they have a dependent child. A national healthcare will provide for consistency. The problem is not with the poorest people who are already eligible for Medicaid, it is with the lower middle class.
    I too believe we have a voice, and I most certainly did not see Trent’s post as suggesting everyone shut up and be quiet. I believe he is suggesting that we try to work together (no childish fighting between parties) for a better life for everyone and that we give the people in office common courtesy and respect, which has been in very short supply lately.

  27. Carol says:

    I’m wondering when “supporting leadership” began to equal “shut and be quiet.” I agree with Trent; the polarity, name-calling, and non-constructive posturing was terrible when Bush was president, and it’s just as bad now. Civil discourse is something we seem to have lost the knowledge of or desire for.

  28. Johanna says:

    Chiming in on health care: I’d venture a guess that very few, if any, people think that the bill that was passed is the very best solution to the health-care problem. It is a compromise. Furthermore, no single person – least of all Obama – had absolute control over what went into the bill. So the idea that everyone who voted for Obama did so because they anticipated and wanted him to enact this exact bill is just nonsense.

    The health-care debate is actually a perfect example of what I was saying before about shouting down the party in power for doing things that you would have favored if your party were in power. Many elements of the health-care bill are (or at least were) Republican ideas. As I understand it, the individual mandate was favored by many Republicans back in the 1990s. Now, many of those same Republicans are arguing that the individual mandate is unconstitutional. Go figure.

  29. Claudia says:

    Johanna, you are so right!

  30. Vicki says:

    Wow! When I read this post, I didn’t expect such vehement commentary from it…well, here’s what I had planned to comment before I read all the previous comments: I was pretty surprised that the Lib-Dems formed a coalition government with the conservatives. From what I remember (granted I haven’t been on that side of the Atlantic since 2004), the Lib Dems were more liberal than labor, so I thought they would be in a better position to push forward with their platform by forming a coalition government with Labour…the Tories and the Lib Dems just seem so opposite on many social issues…who knows? What is it that they say about strange bedfellows?

  31. Elizabeth says:

    Claudia,
    I am sorry to hear of your high medical expenses and understand completely. Our middle class family was thrown for a loop last year when our son was born seven weeks early, completely unexpected. Even with “great” group coverage, our out of pocket medical costs for 2009 exceeded $22,000. This year we are up to $6,000 so far. It is a crippling amount of debt to deal with. You are so right — it’s not the poor that are plagued by our current system, it’s the middle class. Most affluent people I know, including my in-laws, can’t grasp this. They think the people getting themselves in trouble with medical bills don’t bother to have insurance or are simply slovenly people who don’t take care of themselves. We need more reform than what is going through!

  32. AnnJo says:

    @Claudia and Elizabeth,

    I guess you both can see the self-interest in my position but not the self-interest in your own. Both of you use as examples of why we need health care reform that you have personally had to pay for your own family’s health care, instead of being able to use the government’s guns to foist that expense off onto other people. Elizabeth complains of bills totalling $28,000 for a seven week premature childbirth as being “crippling” for a middle class family. But many, many middle class families will take on $28,000 or more in debt for a new car and think little of it. Elizabeth’s experience of a high medical cost is likely to be a once or twice in a lifetime experience, while the financing of a new vehicle is likely to happen once every few years. A middle class family that can afford a new Prius (like Trent) can afford $28,000 for the birth of a premature baby, but maybe they can’t afford both in the same five year period. Should I help pay for the baby so that they can have the Prius? Who’s really being selfish?

    There is no free lunch. The demand for health care is potentially infinite – we all are subject to numerous ailments, pains, deterioration, injuries, etc., many of which can only moderately be improved by medical treatment. I have no idea what kind of pain Claudia’s husband suffers and make no judgment whether it warrants $3,000 a shot treatments, but I have known quite a number of people who claim pain as part of “drug-seeking” or from what used to be called hypochondria, or whose condition would be better treated with exercise, better diet, less booze, and a better attitude. All of those people are right there next to Claudia’s husband, lining up for pain shots. If they at least have to pay a portion of their own costs, maybe they’ll think twice about it.

    The funding to pay for health care must compete with other needs and demands. The farther away the payment for a service gets from the user of a service, the less restraint the user feels in demanding the service.

    I think long and hard about the first major medical treatment of an new year, because I have a large deductible. Most years, I tough it out, or go to the walk-in clinic instead of the ER or do some research on the Internet for a reasonable home treatment or to determine what the risks are of waiting, and have saved many thousands of dollars doing that. Yet in the few years when my deductible has been fully met, I find myself actively looking for what I might do in the way of health care, to take advantage of the fact that for the rest of the year, my health care is “free.” This year I’m getting foot surgery done to alleviate some occasional joint pain caused by a bone spur. When it hurts, it really hurts, but if my insurance didn’t cover it, I’d wait or simply live with it. Not because I don’t have the money to pay for it but because I’d rather use that money for other things.

    That’s the thing about the middle class. We have the money to buy pretty much anything we really want or need, we just don’t have the money to buy EVERYTHING we want or buy it all at once, and have to make choices. If we want a reserve for a $28,000 health emergency, we may have to drive an older car a few extra years, or take a second job, or buy a smaller house, or send our kids to a state college instead of private and make them work part-time along the way, but we CAN have what we need with proper planning and self-control.

    Claudia and Elizabeth are complaining that they have to use their money for advanced medical care of previously untreatable health problems instead of spending it on the other stuff they want. I think they should be greatful that the health system they complain of has allowed the development of those treatments. Advances like that rarely come out of “public” systems.

  33. Johanna says:

    @AnnJo: I’m afraid I’m not seeing what your selfish objection to the health-care reform bill is.

    You have insurance, so you’re already paying for other people’s health care (including, perhaps, some people who have Priuses).

    You mention the “government’s guns” so maybe you think your taxes are going to go up? Does your family earn more than $250,000 a year? Is your high-deductible plan valued at more than $27,500? Do you make extensive use of indoor tanning services?

    How, exactly, do you think this bill is going to negatively impact you?

  34. AnnJo says:

    @Johanna,

    Here are (some of) my selfish reasons –

    1. My insurance plan currently is not required to cover preventive care, prescriptions, people who wait until they get sick to buy coverage, and various other mandates that the new laws will impose – for starters. Therefore, it is the kind of plan I want – true risk-based insurance based on sound underwriting principles. It is also quite affordable, but the changes in the law will make it much more expensive.

    I don’t mind that my insurance pays for other people’s care, because we all made a contract together and with the insurance company to do exactly that, on terms we all agreed to. The new law is adding a bunch of terms none of us agreed to, and then requiring us to pay for this new contract. That, I do mind.

    Also, the people in my plan are like me – because we buy high-deductible plans, we are very careful not to overuse medical services, unlike people whose deductibles are $100 a year and will run to the doctor for a cold or a sprained ankle. The new law will limit high-deductible plans, forcing me to into plans for groups that aren’t like me. Again, higher cost.

    2. Since from now on, ALL coverage will be driven by political lobbying rather than to customer wishes, we can expect to see all kinds of politically popular additions – smoking cessation programs, substance abuse treatment, acupuncturists, naturopaths, whoever has the best PACs. This will add to our premiums, even though many plan participants would prefer not to have the mandated coverages and keep the extra money.

    3. Yes, I think everybody’s taxes will go up, directly or indirectly. First, I don’t make $250,000, but then, since I’m single, all I have to make is $125,000 to get higher taxes. I’ll get hammered when I sell my house. I’ll get hammered by the new investment tax, when I sell stocks. And no “tax the rich” scheme has ever failed to gradually lower the threshold of who is rich. If the law doesn’t do it, inflation will.

    4. The long term direction in which this moves us is a government-run health care system. I know the bill doesn’t provide for that now, but this bill is, as its supporters have made clear, only the beginning. The aim of most supporters is and always has been a public health care system along the lines of the NHS in the U.K. Therefore, the primary goal of the current bill is not to fix our health care system but to finish the destruction of our private system that was started with the adoption of Medicare in the 1960s. If you haven’t noticed how Medicare has increased taxes, you haven’t taken a look at your paycheck lately, and if you think the “rich” 5% of the population can afford to pay for everybody’s health care at a high standard of quality (leaving aside why they should), you’re dreaming. Public health care systems around the world are seeing soaring costs in spite of high taxes, and degrading quality of service. This interim measure will move us in that direction, inevitably, and my health care, and the innovations in health care from which I could benefit in the future, will suffer.

    5. The law intends to act to punish doctors who fail to conform to models of care dictated by government appointed panels whose interests will eventually be mostly in cost-cutting, rather than quality-enhancement. I consult my doctor for her expertise and judgment, and prefer she not be looking over her shoulder to see what the government says she should tell me, and what it s going to cost her to tell me differently.

    6. The federal government has no business interfering in my health care decisions, including the financial parts of them. I didn’t ask for them to meddle in my life this way, and I don’t like it.

    7. Because they are involved in paying for the health care of SOME individuals, governments at every level seem to be taking an inordinate interest in matters that should be none of their business, like our diets, our exercise habits, etc. The one who pays the piper inevitably decides he should call the tune. I predict an ever-growing involvement by government in micro-managing our lives for the sake of our health, under the justification that such meddling is necessary to keep “our” collective costs down. This degree of intrusiveness is alien to a free, self-respecting people.

    I could actually go on to add quite a number of other ways this will negatively impact me and, indeed, most Americans, but it’s late. The Wall Street Journal had a very excellent summary on its site, including detail on a lot of the taxes hidden in the bill. There’s a great deal of naivete about what’s in this behemoth.

  35. Claudia says:

    Anna Jo-
    I think one of the things you don’t understand is that there are many people out there who are not complaining about the high cost of insurance and health care because they want to use the money to buy a new Prius. They are complaining because they would like to use it for something frivilous like FOOD!

    Although, I can not speak for Elizabeth, I can speak for myself. Anyone who thinks I am lazy and want a hand out from the government is sadly mistaken. To suggest so, is rude and uncalled for. My husband and I have worked very hard all our lives. My husband is retired (from the government) and I am still working. And no, my husband does not receive a enormous retirement from the government which is another myth. Recently, $70,000 average government retirement was being bandied about. I know dozens of federal retirees, none of whom come even close to that amount in retirement benefits. Another myth is that the government pays these benefits-they do not, they come from a pension fund which is deducted from employee’s paychecks.
    You are absolutely right about the great deal of naivete about what is in the healthcare reform bill as you too, have no clue how it will work. Like Medicare, this healthcare bill will be continually evolving.

  36. Johanna says:

    @AnnJo: Well, your points 2, 4, 5, and 7 have nothing to do with what’s actually in the bill – they’re your own projections based on your paranoid view of the government. Similarly, point 6 says nothing of substance other than that you don’t like the government telling you what to do – even, apparently, if they’re telling you to do something that you already do.

    Point 3 is based on misinformation. The income threshold for individual taxpayers is $200,000, not $125,000. And you’ll only get “hammered” when you sell your home if you make more than $250K in profit on the sale. And it’ll take many years of inflation before an individual income of $200K becomes “middle class.”

    Point 1, I’ll admit, is somewhat valid, and if you’d left it at that, I’d have a lot more respect for your position. I’m not a lawyer, and I don’t know the details of your plan, but it seems to me that it may be eligible for status as a “grandfathered plan,” and so will not have to change in many of the ways you fear it will (covering preventive care, for example).

    And eventually, of course, no plan will have to cover people who wait until they get sick to buy coverage, because no one will be able to wait until they get sick to buy coverage. That’s the whole point. I’d have thought you’d like that part.

  37. AnnJo says:

    @Johanna,

    My “projections” are based on historical precedent – major government entitlement programs generally cost much more than projected and provide much less in benefits. Go back sometime and read what FDR said about how Social Security was going to “reduce the [government's] necessity of going deeply in debt,” and provide for the United States “an economic structure of vastly greater soundness” – all on a system of 2% payroll taxes on the first $3,000 in wages ($47,000 in today’s dollars).

    We now have 12.4% taxes on the first $106,800 in wages – a cost increase of over 1,400%, while retirement ages have been raised and the surviving spouse’s benefit is lost for many workers now, due to the entry of women into the workforce (compared to 1937 when the spouse’s benefit went into effect).

    Ironically, it’s the trainwreck of Medicare and Medicaid and their burdens on government that is the driving force behind this new bill. I know you’ll call me paranoid, but it seems naive to believe you can cure vast “fraud, waste and abuse” in programs by vastly expanding their scope.

    Is it really paranoid to think that the government’s projections of the costs of health care reform are overly optimistic? The CBO has said that participants in the private health insurance market will see an increase in their premiums. Is it really paranoid to think that their projected increase (16% on average, I believe) is far more likely to be an underestimate than an overestimate? How reliable is ANY estimate that is based on assumptions fed to the CBO by the Administration? Or that, when the head of the Actuarial Office tells Congress he can’t measure the soundness of the assumptions in the bill for “lack of time,” this is a sign that nobody really knows what the heck the thing will cost.

    Don’t you see any contradiction in disparaging my views on health care reform as “projections” based on paranoia, while your defense of it is also based on projections? You project that it will “take many years of inflation before an individual income of $200K becomes middle class. That assumes the threshold won’t be lowered, a huge assumption given the historical track record, and ignores the fact that during inflationary cycles, it takes relatively few years for that to happen. (During the inflationary 1970s, it took less than 8 years for $100,000 to turn into $200,000). Perhaps you aren’t aware of what has happened with the Alternative Minimum Tax, which used to be for “rich” families and now hits many middle income people due to the effects of inflation.

    You project that “no one will be able to wait until they get sick to buy coverage.” Millions of people engage in Social Security and Medicare fraud today. The idea that fraud will come to a dead halt with the new bill is unrealistic. So is the idea that a relatively small fine compared to the cost of premiums will force people, many of whom are “off-grid” in the sense that they file no tax returns, to buy insurance, when they can join any health plan they want if they get seriously sick and have suckers like you and me pick up the tab for them.

    And while you are correct and I mis-spoke that the “rich” tax on individuals doesn’t kick in until $200,000 (for now), you project that the financial impact of the bill will be felt only by those people That is the direct tax only. Indirectly, working and middle class people will indeed see a “tax.” Since I do not plan to add health insurance coverage for my employee, she will pay a “tax” of $2,000, because the amount of the fine I have to pay for not offering insurance will be passed on to her in the form of lower wages than she would otherwise receive. (If I DID offer health insurance, the cost of that too would be passed on to her.) Every employee is worth only so much to a business, and the more the business has to pay the government on account of the employee, the less the employe sees in her pocket. Fact of life. And since she has the same kind of plan I have (high deductible, low frills), she’s going to be paying higher premiums on lower wages. And since she likes both her current pay and her current health plan, she will be worse off, just as I will be by the passage of this law.

    Finally, since I also depend on a sound national fiscal policy for my retirement future, and this bill speeds up our national debt and deficit on their collision course with collapse (and on that, if I’m paranoid, so are many widely respected economists), this bill is not good for me or most people in this country.

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