Very rarely do politics and sports intercede (the last time was the Mitchel report about steroid use in baseball), but when they do, I sometimes feel the need to jump ship from politics and take my soap box in the sports arena.
Senator Orrin Hatch (R-Utah) recently asked President Obama to investigate the Bowl Championship Series under the Sherman Anti-Trust law. This may be one of the first truly bi-partisan efforts that I can fully stand behind. Quite frankly, Senator Hatch might be a genius if he pull this off.
We all heard President Obama say that if he was elected President he would "throw [his] weight around a little bit" to influence a college football playoff system. Well, Mr. President, this is one campaign promise I do not want you to break.
Senator Hatch represents Utah, where his home school (the University of Utah) went undefeated last year, yet was passed over by the BCS system to play in the national championship. Instead, Florida and Oklahoma were invited to play in the national championship game.
There has always been a cloud of controversy surrounding how the BCS championship game is selected. There are "BCS conferences", conferences whose teams get automatic bids to participate in top-tier bowl games where non-BCS conference teams do not. Teams that play in the top-tier bowl games receive more exposure, revenue from ticket sales, and have a better advantage when it comes to recruiting and transferring ticket revenue to less popular sports.
Senator Hatch argues the BCS violates anti-trust law because the system "has been designed to limit the number of teams from non-privileged conferences that will play in BCS games". He adds the BCS system "artificially limits the number of nationally-relevant bowl games to five. The result is reduced access to revenues and visibility which creates disadvantages to schools in the non-privileged conferences."I completely agree with Senator Hatch's claims. The BCS system is inequitable by discriminating against schools from weaker conferences.
The call for change is nothing new. Some say the regular season acts as the playoff system in that every game is equally important to your post-season success, but in my opinion a playoff would show which teams can play better against better teams. Pretty much every major conference team schedules teams from weaker conferences, like the Sun Belt (a garbage conference) or even Division I-AA teams (like EKU and Morehead) to get more wins and become bowl-eligible. That's like Middlesboro and Bell County playing West Jessamine Middle School to get more wins and pad statistics. But because it's the norm and the culture of college football programs today, no one really questions it. [On a side note, as much as I dislike them, a big kudos to USC for playing both Notre Dame and Ohio State on the road and coming away with wins; watch them in the BCS bowl picture this year.]
In the BCS system, strength of a team's schedule determines better teams. This may be the case, but what about teams that get hot late in the season that could really do some damage in the playoffs? Sometimes it just takes a few games for a team to hit their stride. Does this mean that the teams that play the best football late in the season are less deserving to play in the title game if they have a loss or two? What about a good team that has a late season loss (which hurts the team more than an early season loss under the BCS computer system's analysis). A playoff allows any doubt as to the supremacy of a team to be removed.
If you make a playoff system for college football, that is a significant increase in funding for school athletics programs. Most people suggest a 16 or 8 team national championship playoff, which I support. Other teams that qualify for bowl games would still receive a bowl but, just not a bid to the national championship playoff. More games equal more money for schools and an uncontested national champion. None of this "split national champions" shenanigans that we've seen recently (LSU and USC in 2003-2004, for instance).
In America, sporting events and sporting merchanide is a major component of our economy. President Obama would be wise to start throwing his weight around now and call this his second "stimulus package". Instead of creating jobs by spending money, he would create jobs and stimulate some spending just by asking the BCS to abolish their current system and just add a few extra games to the post-season. I know I wouldn't mind a few more weeks of football season. In fact it might be one of the things I might praise President Obama for.
Thursday, October 22, 2009
Friday, October 9, 2009
This Nobel is "Prized" No Longer
On Friday, October 9th, 2009, it was announced by the Nobel Committee that President Obama was the winner of the Nobel Peace Prize. This is quite an accomplishment for anyone to achieve, especially our President.
But something is amiss here. How could a President who has been in office for less than a year receive an award that is based on the actual work of an individual to bring peace to the world? Did I miss something? Did President Obama help diffuse racial problems in East Chicago? Did he solve the conflict-diamond problem in Africa? Did he personally propose and champion legislation as a Senator that removed the United States from all foreign wars? Is he the reincarnation of Mother Theresa?
There's a lot that we don't know about President Obama, but I seriously doubt that we missed his appearance in the movie, Superman IV: The Quest for Peace. Quite frankly, I think Superman or even Christopher Reeve deserves the Nobel Peace Prize before President Obama does.
What has President Obama done to promote peace in his relatively short time as our Nation's leader? He may have traveled across seas to talk to some heads of state and walked out of a United Nation's address by President Ahmadinejad (so did a lot of other world leaders), but that's normal business for the President (even Bush). So surely these cannot be the criteria for the Nobel Peace Prize!
President Obama is currently in two wars. Doesn't this seem to be a disqualifying characteristic for the Nobel Peace Prize. Granted they are inherited, but nonetheless, should you win a peace award when you are Commander in Chief of a nation at war?
When you look at Nobel Peace Prize Laurettes, one name that is missing and should be included is Mahatma Gandhi. He never won a Nobel Peace Prize and he starved himself for India's independence from Britain. That's a lot more work towards peace than just succeeding President Bush (which I assume is the reason Obama is receiving this award).
It has been publicized that the Nobel Peace Prize was awarded to President Obama based on the "potential" he demonstrates to bring peace. I'm sorry, I didn't know that awards were made based on how good you "might" be. I guess that means competitive sports are finished. We can just award a trophy/championship to the team that starts their respective season ranked above all other teams.
And what's more damning is that the Nobel Committee's deadline for Peace Prize candidates is February 1st. President Obama would have been in office for less than two weeks. That's hardly enough time for Obama to clean the Oval Office and settle in. This further justifies my believe he received the award simply because he succeeded Bush.
The point is, currently we don't know what type of legacy President Obama will leave behind, but I do know that there hasn't been enough done to justify him receiving this award. I don't care if he began making friendly with Muslims; he has just started his work and nothing has come of it. In my opinion, this is just proof that the Nobel Committee either has a severe Liberal bias or a severe Obama bias. Quite frankly it tarnishes the Nobel Peace Prize to award it based on the "potential" someone has to do good rather than the actual good he or she has performed.
I'm not saying that President Obama doesn't have the potential to win the award, I sincerely hope he is capable of establishing peace in the Middle-East. But until that work is done, awarding this prize to President Obama is disrespectful to the work of the men and women who received the award in years past.
But something is amiss here. How could a President who has been in office for less than a year receive an award that is based on the actual work of an individual to bring peace to the world? Did I miss something? Did President Obama help diffuse racial problems in East Chicago? Did he solve the conflict-diamond problem in Africa? Did he personally propose and champion legislation as a Senator that removed the United States from all foreign wars? Is he the reincarnation of Mother Theresa?
There's a lot that we don't know about President Obama, but I seriously doubt that we missed his appearance in the movie, Superman IV: The Quest for Peace. Quite frankly, I think Superman or even Christopher Reeve deserves the Nobel Peace Prize before President Obama does.
What has President Obama done to promote peace in his relatively short time as our Nation's leader? He may have traveled across seas to talk to some heads of state and walked out of a United Nation's address by President Ahmadinejad (so did a lot of other world leaders), but that's normal business for the President (even Bush). So surely these cannot be the criteria for the Nobel Peace Prize!
President Obama is currently in two wars. Doesn't this seem to be a disqualifying characteristic for the Nobel Peace Prize. Granted they are inherited, but nonetheless, should you win a peace award when you are Commander in Chief of a nation at war?
When you look at Nobel Peace Prize Laurettes, one name that is missing and should be included is Mahatma Gandhi. He never won a Nobel Peace Prize and he starved himself for India's independence from Britain. That's a lot more work towards peace than just succeeding President Bush (which I assume is the reason Obama is receiving this award).
It has been publicized that the Nobel Peace Prize was awarded to President Obama based on the "potential" he demonstrates to bring peace. I'm sorry, I didn't know that awards were made based on how good you "might" be. I guess that means competitive sports are finished. We can just award a trophy/championship to the team that starts their respective season ranked above all other teams.
And what's more damning is that the Nobel Committee's deadline for Peace Prize candidates is February 1st. President Obama would have been in office for less than two weeks. That's hardly enough time for Obama to clean the Oval Office and settle in. This further justifies my believe he received the award simply because he succeeded Bush.
The point is, currently we don't know what type of legacy President Obama will leave behind, but I do know that there hasn't been enough done to justify him receiving this award. I don't care if he began making friendly with Muslims; he has just started his work and nothing has come of it. In my opinion, this is just proof that the Nobel Committee either has a severe Liberal bias or a severe Obama bias. Quite frankly it tarnishes the Nobel Peace Prize to award it based on the "potential" someone has to do good rather than the actual good he or she has performed.
I'm not saying that President Obama doesn't have the potential to win the award, I sincerely hope he is capable of establishing peace in the Middle-East. But until that work is done, awarding this prize to President Obama is disrespectful to the work of the men and women who received the award in years past.
Friday, September 11, 2009
Just the Facts, Mr. President
Politicians often rely on half-truths and blatant lies to sell their policy ideas. President Obama is no exception. After hearing his address to Congress regarding his health care plan, there are some half-truths and lies that need to be dispelled. Here is a list of them:
(1) President Obama will not sign a bill that "adds one dime to our deficit either now or in the future. Period." Verdict: Half-truth. First, there is no final version of the bill, just versions that are being kicked around and amended (probably as you're reading this). Second, the House Democrat's version would add $220 Billion to the deficit over 10 years as determined by the Congressional Budget Office (which is a non-partisan agency). Democrats say they don't have to claim $245 Billion dollars of the price tag because, and here's where it gets confusing, Democrats already decided to exempt the adjustment of the Medicare reimbursement rates from Congressional rules that require programs to be paid for. Simply put, they decided this doesn't have to be paid for because they decided it doesn't have to be paid for.
(2) President Obama has pledged not to cut Medicare benefits under his plan, but reduce Medicare payments by more than $500 Billion over 10 years. Verdict: Half-truth. The cuts proposed would disproportionately hit Medicare Advantage (which is operated through private insurance companies). Experts believe that a cut of this magnitude will reduce benefits for the 25 percent of Medicare users covered through Medicare Advantage. Supporters of Obama's plan counter that the cuts can be absorbed by improving how Medicare operates and would only reduce the waste, fraud, and abuse of the current system. Any overall affect is largely unknown.
(3) President Obama stated there are 30 Million people who cannot get coverage. Verdict: Close. Depending on which report you look at, the number of people who cannot get coverage varies. Previously, President Obama suggested there are 46 Million people who cannot get coverage, but this is probably an overestimate because it captures those young and healthy Americans who forgo getting health coverage to save money. The 30 Million individuals he used in his address come from the Kaiser Commission on Medicaid and the Uninsured, whereas the 46 Million figure he previously used comes from census data. The 30 Million is the actual target of the program, because these are the individuals that cannot afford insurance because they are poor or near poor.
(4) President Obama argues that preventative medicine 'makes sense, saves money, and saves lives' (paraphrased). Verdict: Lie and a Truth. Not all preventative care saves money, but does save lives. Studies have proven that the specific types of tests mentioned during his speech (colonoscopies and mammograms) cost more money than they save. Detecting acute diseases like breast cancer in the early stages of the disease involve testing many people who would never develop the disease. The costs incurred for a large number of tests, even if they're cheap, outweigh the costs of caring for the minority of people who would have ended up with the diseases without testing. The Congressional Budget Office even agrees that "... for the most preventive services, expanded utilization leads to higher, not lower, medical spending overall". President Obama was right about saving lives, but was wrong about saving money.
(5) President Obama informed the people that changing jobs or starting your own business will not impede you from getting health coverage. Verdict: He phrased it wrong. In the President's speech, he endorsed mandatory health insurance coverage for all individuals (an approach he did not embrace as a candidate). Given his position, in his speech he should have stated, "If you lose your job or change your job, you will have to get coverage. If you strike out on your own and start a small business, you will have to get coverage" (rather than using the words "will be able to get coverage" in his original speech).
(6) President Obama has stated that nothing in his plan will require us or our employer to change to coverage or the doctor we already have. Verdict: Correct at face value only. The current version does not guarantee that people can keep their current coverage. Employers elect sponsor coverage for most families, but under the current bill, employers would be free to change health plans in ways that employees may not like or decide to drop health insurance benefits altogether. The Congressional Budget Office analyzed the House Democrat's version and decided that by 2016 that some 3 Million people with employer-provided health care would lose coverage when employers drop health insurance in order to save money.
(7) And lastly, the comment that stole the show. President Obama stated that his reforms would not apply to unauthorized aliens, to which South Carolina Republican Joe Wilson shouted "You lie!" from his seat. Verdict: You decide. The bill specifically prohibits federal money to be spent on non-citizens. However, illegal immigrants could buy private health insurance, as some do now, but won't receive any tax benefits. However, it has been argued that the system proposed under the bill does not have appropriate citizenship verification requirements in place to ensure illegal immigrants do not capitalize on the program.
(1) President Obama will not sign a bill that "adds one dime to our deficit either now or in the future. Period." Verdict: Half-truth. First, there is no final version of the bill, just versions that are being kicked around and amended (probably as you're reading this). Second, the House Democrat's version would add $220 Billion to the deficit over 10 years as determined by the Congressional Budget Office (which is a non-partisan agency). Democrats say they don't have to claim $245 Billion dollars of the price tag because, and here's where it gets confusing, Democrats already decided to exempt the adjustment of the Medicare reimbursement rates from Congressional rules that require programs to be paid for. Simply put, they decided this doesn't have to be paid for because they decided it doesn't have to be paid for.
(2) President Obama has pledged not to cut Medicare benefits under his plan, but reduce Medicare payments by more than $500 Billion over 10 years. Verdict: Half-truth. The cuts proposed would disproportionately hit Medicare Advantage (which is operated through private insurance companies). Experts believe that a cut of this magnitude will reduce benefits for the 25 percent of Medicare users covered through Medicare Advantage. Supporters of Obama's plan counter that the cuts can be absorbed by improving how Medicare operates and would only reduce the waste, fraud, and abuse of the current system. Any overall affect is largely unknown.
(3) President Obama stated there are 30 Million people who cannot get coverage. Verdict: Close. Depending on which report you look at, the number of people who cannot get coverage varies. Previously, President Obama suggested there are 46 Million people who cannot get coverage, but this is probably an overestimate because it captures those young and healthy Americans who forgo getting health coverage to save money. The 30 Million individuals he used in his address come from the Kaiser Commission on Medicaid and the Uninsured, whereas the 46 Million figure he previously used comes from census data. The 30 Million is the actual target of the program, because these are the individuals that cannot afford insurance because they are poor or near poor.
(4) President Obama argues that preventative medicine 'makes sense, saves money, and saves lives' (paraphrased). Verdict: Lie and a Truth. Not all preventative care saves money, but does save lives. Studies have proven that the specific types of tests mentioned during his speech (colonoscopies and mammograms) cost more money than they save. Detecting acute diseases like breast cancer in the early stages of the disease involve testing many people who would never develop the disease. The costs incurred for a large number of tests, even if they're cheap, outweigh the costs of caring for the minority of people who would have ended up with the diseases without testing. The Congressional Budget Office even agrees that "... for the most preventive services, expanded utilization leads to higher, not lower, medical spending overall". President Obama was right about saving lives, but was wrong about saving money.
(5) President Obama informed the people that changing jobs or starting your own business will not impede you from getting health coverage. Verdict: He phrased it wrong. In the President's speech, he endorsed mandatory health insurance coverage for all individuals (an approach he did not embrace as a candidate). Given his position, in his speech he should have stated, "If you lose your job or change your job, you will have to get coverage. If you strike out on your own and start a small business, you will have to get coverage" (rather than using the words "will be able to get coverage" in his original speech).
(6) President Obama has stated that nothing in his plan will require us or our employer to change to coverage or the doctor we already have. Verdict: Correct at face value only. The current version does not guarantee that people can keep their current coverage. Employers elect sponsor coverage for most families, but under the current bill, employers would be free to change health plans in ways that employees may not like or decide to drop health insurance benefits altogether. The Congressional Budget Office analyzed the House Democrat's version and decided that by 2016 that some 3 Million people with employer-provided health care would lose coverage when employers drop health insurance in order to save money.
(7) And lastly, the comment that stole the show. President Obama stated that his reforms would not apply to unauthorized aliens, to which South Carolina Republican Joe Wilson shouted "You lie!" from his seat. Verdict: You decide. The bill specifically prohibits federal money to be spent on non-citizens. However, illegal immigrants could buy private health insurance, as some do now, but won't receive any tax benefits. However, it has been argued that the system proposed under the bill does not have appropriate citizenship verification requirements in place to ensure illegal immigrants do not capitalize on the program.
September 11th, Never Forgotten
It has almost been a year since I've been writing columns for the Middlesboro Daily News and posting them to my blogspot account. My first column was targeted at providing correct information about the economic bailout package presented by former President Bush (in late September). I never had a chance to write a column that focused on the attacks on September 11th, 2001.
This date will live in infamy, much in the same way the attacks on Pearl Harbor on December 7th, 1941 resonates with a previous generation. It is a date, and an event, that will forever shape the minds of today's generation.
Much like the assassination of President John F. Kennedy, or when Neil Armstrong took those historic steps on the moon, we will all remember where we were at, what we were doing, and our first reactions to the attacks that fateful day.
Eight years later, we are a nation that has been propelled in a dramatically different way because of these attacks. We can only conjecture what our lives and our nation would look like had we never been victimized by religious extremists organized by Usama bin Laden.
What if we had never declared war on terror? What if we had not actively sought out those who were responsible for the attacks that day? What if we had never taken preventative measures to thwart terrorist attacks? Would the liquid bombers have been successful (the reason why you can't take liquids on a plane in large quantity)? Would New York City have made it this long without a large terrorist attack (the numerous planned attacks aimed at the NYC subway system)? Would Afghanistan and Iraq be uncontested breeding grounds for terrorism?
I can only speculate. But what I do know is that there has been a lot of sacrifice and a lot of tears shed since that day. Those who were lost to those unscrupulous acts of evil should never be forgotten. The bravery of the New York Fire Department, the New York Police Department, and all those servicemen and women who worked to restore order to the chaos should never be forgotten. The bravery of the men and women on United Airlines Flight 93 should never be forgotten. The bravery of the men and women in our armed forces should never be forgotten. The compassion and patriotism that we as a nation demonstrated that day should never be forgotten.
What we should also not forget are the actions of Former President Bush. The nation stood behind him, united after these attacks, as he began his new campaign based on the promises he made to the American people. President Bush promised us that the individuals responsible for these attacks would come to justice and that he would take all necessary actions to prevent a subsequent attack.
And I think we forgot that somewhere along the line. Did President Bush act inappropriately while trying to defend our nation? I personally don't think it's that black and white, but more shades of gray. I personally think that President Bush took up his cause and fought to protect us from other terrorist attacks, even when his methods lost popularity. President Bush sacrificed approval ratings for our safety in much the same way that a parent sacrifices the admiration of their children for their safety. Bush would rather have been a good President than a cool one.
So despite what the media says, and despite what other people say about him, I will never forget the protection that President Bush provided for this country during his eight years in office.
This date will live in infamy, much in the same way the attacks on Pearl Harbor on December 7th, 1941 resonates with a previous generation. It is a date, and an event, that will forever shape the minds of today's generation.
Much like the assassination of President John F. Kennedy, or when Neil Armstrong took those historic steps on the moon, we will all remember where we were at, what we were doing, and our first reactions to the attacks that fateful day.
Eight years later, we are a nation that has been propelled in a dramatically different way because of these attacks. We can only conjecture what our lives and our nation would look like had we never been victimized by religious extremists organized by Usama bin Laden.
What if we had never declared war on terror? What if we had not actively sought out those who were responsible for the attacks that day? What if we had never taken preventative measures to thwart terrorist attacks? Would the liquid bombers have been successful (the reason why you can't take liquids on a plane in large quantity)? Would New York City have made it this long without a large terrorist attack (the numerous planned attacks aimed at the NYC subway system)? Would Afghanistan and Iraq be uncontested breeding grounds for terrorism?
I can only speculate. But what I do know is that there has been a lot of sacrifice and a lot of tears shed since that day. Those who were lost to those unscrupulous acts of evil should never be forgotten. The bravery of the New York Fire Department, the New York Police Department, and all those servicemen and women who worked to restore order to the chaos should never be forgotten. The bravery of the men and women on United Airlines Flight 93 should never be forgotten. The bravery of the men and women in our armed forces should never be forgotten. The compassion and patriotism that we as a nation demonstrated that day should never be forgotten.
What we should also not forget are the actions of Former President Bush. The nation stood behind him, united after these attacks, as he began his new campaign based on the promises he made to the American people. President Bush promised us that the individuals responsible for these attacks would come to justice and that he would take all necessary actions to prevent a subsequent attack.
And I think we forgot that somewhere along the line. Did President Bush act inappropriately while trying to defend our nation? I personally don't think it's that black and white, but more shades of gray. I personally think that President Bush took up his cause and fought to protect us from other terrorist attacks, even when his methods lost popularity. President Bush sacrificed approval ratings for our safety in much the same way that a parent sacrifices the admiration of their children for their safety. Bush would rather have been a good President than a cool one.
So despite what the media says, and despite what other people say about him, I will never forget the protection that President Bush provided for this country during his eight years in office.
Wednesday, September 9, 2009
Our Social Security Blanket
One of the long debated public policy issues since it's inception has been the Social Security Program. This program was conceived as a way to both provide income for individuals late in life (who are less able to earn income) as well as provide some incentive for people to eventually retire and open up jobs to a younger generation.
I don't have to go over how the whole program works. But I do think it's important for people to know that Social Security is an unfunded program. When I say unfunded program, it means that the money you and I pay into Social Security (not like we have a choice, it's deducted from our paychecks) is not being set aside just for us when we retire, but is going to pay the benefits of current retirees. If Social Security were a fully-funded program, I would be paying into my own retirement and you into your own.
When this program was first conceived, an unfunded program seemed to be the best way to provide Social Security benefits as soon as possible. What the program's creator, President Franklin Delano Roosevelt, did not (and could not) foresee was what effect a sudden "baby boom" would have on the Social Security program.
Ten years after Social Security was signed into law, the Second World War had just ended and American Soldiers returned to America with a promising and bright economic future ahead of them. There was a flood of new births in the United States and from 1946 to 1964, there was a large growth in the American birth rate.
Now let's fast forward to today. The earliest age to retire and collect Social Security benefits is 62 (with 65 for full benefits and 67 for increased benefits). So the earliest Baby Boomers (1946) are currently 63 years old and the latest Baby Boomers (1964) will reach early retirement age in 2026. The big fear is that there will not be enough current workers to pay the benefits of the current retirees.
Our nation has not since had another baby boom to rival that of the Baby Boomers. Now my thinking would be that the Baby Boomers would create a "Second Wave" of Baby Boomers (when the Baby Boomers began having children), and then that Second Wave would produce a "Third Wave", but this has not been the case. Demographically speaking, the increase in the American birth rate when the Baby Boomers hit reproductive age has in no way compared to that of the original Baby Boom. This the result of a cultural shift; people are having less children now, and later in life, than they would have in the 1940's through 1960's; which has further compounded the Social Security problem.
Analysts have already warned Congress that when the Baby Boomers begin to retire that the current surplus in the Social Security Trust Fund will eventually dwindle and bankrupt Social Security sometime after the year 2020. There will be too much money paid out in benefits than is being paid in by the current workers.
I myself am part of the "Second Wave". My mother and father are both Baby Boomers and they will soon be ready to retire. I am currently in my mid 20's and enjoying my adult life as well as contemplating having children with my wife. Social Security means a lot to me (as I may never see a cent of it but have definitely paid into it) and is an issue that is very near to my heart.
So what options do we have to save Social Security? Traditionally, the main options have been to (1) raise taxes and increase revenue to the Social Security Fund, (2) raise the retirement age, and/or (3) cut benefits. I agree there needs to be a short-term solution considered now, but there is also a long-term solution to the problem.
The Cash for Clunkers program and the First Time Home Buyers Tax Credit were successful programs, at least by economic consumption standards. These cash incentive programs achieved their intended purpose: they made consumers purchase cars and houses. A long-term solution to Social Security would be if President Obama created the "Bucks for Babies" program that provided a cash incentive (in addition to tax breaks) for people to have children who eventually will work jobs and pay into Social Security. This would help to change the reproductive strategies in America in much the same way Cash for Clunkers and the Tax Credit incentivized and influenced the consumption patters of Americans.
Of course this can easily backfire without the right restrictions. The wrong people could begin having children that they can't afford to take care of. The Bucks for Babies program would make jobs more competitive when the new wave of children reaches working age, potentially increasing unemployment. The idea needs some work, but can be considered another option to reform Social Security.
And it would be a lot less expensive than the other solution I advocate for; making Social Security a fully-funded system. This would require spending a LOT of money to fund the current retirees' benefits while the current workers begin saving for their own retirement.
Clearly something needs to be done and there are options available. It would just be nice to see Congress actually heed some of the warnings they have been given and take action on the issue rather than being so short-sighted and focused on reelection.
I don't have to go over how the whole program works. But I do think it's important for people to know that Social Security is an unfunded program. When I say unfunded program, it means that the money you and I pay into Social Security (not like we have a choice, it's deducted from our paychecks) is not being set aside just for us when we retire, but is going to pay the benefits of current retirees. If Social Security were a fully-funded program, I would be paying into my own retirement and you into your own.
When this program was first conceived, an unfunded program seemed to be the best way to provide Social Security benefits as soon as possible. What the program's creator, President Franklin Delano Roosevelt, did not (and could not) foresee was what effect a sudden "baby boom" would have on the Social Security program.
Ten years after Social Security was signed into law, the Second World War had just ended and American Soldiers returned to America with a promising and bright economic future ahead of them. There was a flood of new births in the United States and from 1946 to 1964, there was a large growth in the American birth rate.
Now let's fast forward to today. The earliest age to retire and collect Social Security benefits is 62 (with 65 for full benefits and 67 for increased benefits). So the earliest Baby Boomers (1946) are currently 63 years old and the latest Baby Boomers (1964) will reach early retirement age in 2026. The big fear is that there will not be enough current workers to pay the benefits of the current retirees.
Our nation has not since had another baby boom to rival that of the Baby Boomers. Now my thinking would be that the Baby Boomers would create a "Second Wave" of Baby Boomers (when the Baby Boomers began having children), and then that Second Wave would produce a "Third Wave", but this has not been the case. Demographically speaking, the increase in the American birth rate when the Baby Boomers hit reproductive age has in no way compared to that of the original Baby Boom. This the result of a cultural shift; people are having less children now, and later in life, than they would have in the 1940's through 1960's; which has further compounded the Social Security problem.
Analysts have already warned Congress that when the Baby Boomers begin to retire that the current surplus in the Social Security Trust Fund will eventually dwindle and bankrupt Social Security sometime after the year 2020. There will be too much money paid out in benefits than is being paid in by the current workers.
I myself am part of the "Second Wave". My mother and father are both Baby Boomers and they will soon be ready to retire. I am currently in my mid 20's and enjoying my adult life as well as contemplating having children with my wife. Social Security means a lot to me (as I may never see a cent of it but have definitely paid into it) and is an issue that is very near to my heart.
So what options do we have to save Social Security? Traditionally, the main options have been to (1) raise taxes and increase revenue to the Social Security Fund, (2) raise the retirement age, and/or (3) cut benefits. I agree there needs to be a short-term solution considered now, but there is also a long-term solution to the problem.
The Cash for Clunkers program and the First Time Home Buyers Tax Credit were successful programs, at least by economic consumption standards. These cash incentive programs achieved their intended purpose: they made consumers purchase cars and houses. A long-term solution to Social Security would be if President Obama created the "Bucks for Babies" program that provided a cash incentive (in addition to tax breaks) for people to have children who eventually will work jobs and pay into Social Security. This would help to change the reproductive strategies in America in much the same way Cash for Clunkers and the Tax Credit incentivized and influenced the consumption patters of Americans.
Of course this can easily backfire without the right restrictions. The wrong people could begin having children that they can't afford to take care of. The Bucks for Babies program would make jobs more competitive when the new wave of children reaches working age, potentially increasing unemployment. The idea needs some work, but can be considered another option to reform Social Security.
And it would be a lot less expensive than the other solution I advocate for; making Social Security a fully-funded system. This would require spending a LOT of money to fund the current retirees' benefits while the current workers begin saving for their own retirement.
Clearly something needs to be done and there are options available. It would just be nice to see Congress actually heed some of the warnings they have been given and take action on the issue rather than being so short-sighted and focused on reelection.
Tuesday, August 11, 2009
The Death Spiral of Health Care
I've been watching and waiting on what's going to happen with the health care legislation that is currently working it's way through congress. Along the way, here is what we've seen; town hall meetings gone awry, Speaker of the House, Nancy Pelosi calling protestors "un-American", right wing propganda, and left wingers firing back with a "tattle-tale" website.
The town hall dissidents have been entertaining, but at the same time shameful. The anti-Bush protests should have taught the Right one thing; if you are going to protest, do so with some respect. But then again, did the Bush protestors really think those years of nasty demonstrations wouldn't lead to the same type of demonstrations against President Obama? If anything, those protestors left such an impression on the Right, they began using the same tact and tactics against President Obama.
And really, Nancy Pelosi? Calling the protestors "un-American"? Did you forget how you were "energized" by the same unruly and disruptive protesting tactis used in 2006 to demonstrate against the Iraq War? But I have a name for you, Nancy. "Liar". How patriotic and American are you to accuse the CIA of lying to Congress about the use of waterboarding? Why should the American people believe a word you say now considering just two examples of you speaking out of both sides of you mouth? Don't call these people "un-American" for exercising their first amendment right. These people are yelling at the top of their lungs for their representatives in Congress to hear them and act on their demands! Isn't that the way the representative Congress is supposed to act anyways? Or do you believe you are above the demands of your constituents?
There is so much information floating around right now about the health care bill that the only way to get the actual information is to read the bill itself. I'm hesitant to trust the website President Obama created to dispell rumors about the health care bill, fearing that it contains the same propoganda the Right has been shelling out.
And really, President Obama? A tattle-tale website? I understand there is a lot of propoganda out there right now, but do you have to resort to 2nd grade tactics to make your point? How about a national address where you explain in detail what the health care bill is intended to do? Oh wait, you tried that already. How did that end, again? With a beer summit because you commented on a local matter you had no business commenting on? Fantastic.
So why is there so much drama surrounding the health care issue? Is it because no one wants people to have health coverage? I doubt that. This is a very complicated matter that will harm more people than it will help.
The economics behind this legislation are far reaching. Opponents feel that a public health option would be too competitive with private insurance companies and eventually run the private companies out. The "insurance exchange" as the Obama Administration puts it, provides "low-cost, high-quality" health insurance to families that cannot currently afford health insurance. But if this program is low-cost and high-quality, won't that result in some people switching from private or employer provided health-insurance to save some money? This is the classic death spiral taught in Economics 101 that leads to the destruction of insurance companies.
Let me explain. With a government option that costs less money than private or employer provided insurance, the healthiest individuals will switch to the government option to save money. This will decrease the "risk pool" the health insurance companies have (the non-sick subsidizing the health care costs of the sickly). When this happens, insurance premiums must go up since the healthiest have left the pool and there is less subsidized money available for the sickly in the insurance risk pool. When the premiums go up, more healthy people leave the risk pool to capitalize on the lower premiums from the government plan. This continues to happen until the insurance companies can no longer afford to provide insurance, resulting in everyone transferring to the government option; the end result being socialized medicine. Quite frankly I'm shocked the Obama administration missed this day in Economics 101 and to date has ignored this possibility.
And on top of that, is the Obama Administration anticipating a jump in the demand for the government run program? Republicans are correct to argue they didn't do such a great job with the "Cash for Clunkers" program and it's safe to assume they wouldn't with a government run health insurance program. A large increase in people joining the insurance exchange could further bog down the program and lead to long waiting times for benefit reimbursement. Government is inefficient enough as it is, let alone if program demand dramatically increases the benefit processing time.
Now I'm not saying that the Republican flow-chart detailing program benefits is necessarily correct, but I don't believe that the Democrats have taken all things into consideration. Am I saying that health care doesn't need reform? No. Health care desperately needs reform because it is entirely too expensive today. Do I think this particular plan is the best solution? Of course not. This alternative does more to harm health care today than it does to help it. Maybe with a little more work (and the Obama Administration backing off from deadlines to have the bill passed) Congress could come up with something that could minimize the death spiral of the insurance companies and at the same time provide health care to those who need it most and can't afford it.
The town hall dissidents have been entertaining, but at the same time shameful. The anti-Bush protests should have taught the Right one thing; if you are going to protest, do so with some respect. But then again, did the Bush protestors really think those years of nasty demonstrations wouldn't lead to the same type of demonstrations against President Obama? If anything, those protestors left such an impression on the Right, they began using the same tact and tactics against President Obama.
And really, Nancy Pelosi? Calling the protestors "un-American"? Did you forget how you were "energized" by the same unruly and disruptive protesting tactis used in 2006 to demonstrate against the Iraq War? But I have a name for you, Nancy. "Liar". How patriotic and American are you to accuse the CIA of lying to Congress about the use of waterboarding? Why should the American people believe a word you say now considering just two examples of you speaking out of both sides of you mouth? Don't call these people "un-American" for exercising their first amendment right. These people are yelling at the top of their lungs for their representatives in Congress to hear them and act on their demands! Isn't that the way the representative Congress is supposed to act anyways? Or do you believe you are above the demands of your constituents?
There is so much information floating around right now about the health care bill that the only way to get the actual information is to read the bill itself. I'm hesitant to trust the website President Obama created to dispell rumors about the health care bill, fearing that it contains the same propoganda the Right has been shelling out.
And really, President Obama? A tattle-tale website? I understand there is a lot of propoganda out there right now, but do you have to resort to 2nd grade tactics to make your point? How about a national address where you explain in detail what the health care bill is intended to do? Oh wait, you tried that already. How did that end, again? With a beer summit because you commented on a local matter you had no business commenting on? Fantastic.
So why is there so much drama surrounding the health care issue? Is it because no one wants people to have health coverage? I doubt that. This is a very complicated matter that will harm more people than it will help.
The economics behind this legislation are far reaching. Opponents feel that a public health option would be too competitive with private insurance companies and eventually run the private companies out. The "insurance exchange" as the Obama Administration puts it, provides "low-cost, high-quality" health insurance to families that cannot currently afford health insurance. But if this program is low-cost and high-quality, won't that result in some people switching from private or employer provided health-insurance to save some money? This is the classic death spiral taught in Economics 101 that leads to the destruction of insurance companies.
Let me explain. With a government option that costs less money than private or employer provided insurance, the healthiest individuals will switch to the government option to save money. This will decrease the "risk pool" the health insurance companies have (the non-sick subsidizing the health care costs of the sickly). When this happens, insurance premiums must go up since the healthiest have left the pool and there is less subsidized money available for the sickly in the insurance risk pool. When the premiums go up, more healthy people leave the risk pool to capitalize on the lower premiums from the government plan. This continues to happen until the insurance companies can no longer afford to provide insurance, resulting in everyone transferring to the government option; the end result being socialized medicine. Quite frankly I'm shocked the Obama administration missed this day in Economics 101 and to date has ignored this possibility.
And on top of that, is the Obama Administration anticipating a jump in the demand for the government run program? Republicans are correct to argue they didn't do such a great job with the "Cash for Clunkers" program and it's safe to assume they wouldn't with a government run health insurance program. A large increase in people joining the insurance exchange could further bog down the program and lead to long waiting times for benefit reimbursement. Government is inefficient enough as it is, let alone if program demand dramatically increases the benefit processing time.
Now I'm not saying that the Republican flow-chart detailing program benefits is necessarily correct, but I don't believe that the Democrats have taken all things into consideration. Am I saying that health care doesn't need reform? No. Health care desperately needs reform because it is entirely too expensive today. Do I think this particular plan is the best solution? Of course not. This alternative does more to harm health care today than it does to help it. Maybe with a little more work (and the Obama Administration backing off from deadlines to have the bill passed) Congress could come up with something that could minimize the death spiral of the insurance companies and at the same time provide health care to those who need it most and can't afford it.
Tuesday, July 21, 2009
The Only Thing Worse Than Beating A Dead Horse is Betting On One
Recently the Kentucky General Assembly voted not to allow slot machines and other gaming to accompany horse racing. This was a bad move in my opinion.
Kentucky has a proud heritage of horse breeding and horse racing. I can remember going to races at Keeneland Downs in Lexington, Kentucky and seeing the immaculate grounds at Church Hill Downs in Louisville, Kentucky. The Kentucky Derby is one of the most watched cultural-sporting events in the U.S.
However, the General Assembly's decision to not allow gaming at race tracks is hurting the purse winnings in Kentucky's horse racing and the overall talent that races in Kentucky. Our Kentucky tradition is under fire from neighboring states that allow facilities to offer horse racing as well as casinos.
Our neighboring states, most notably, Indiana and Pennsylvania, have what are called "racinos" (horse racing and casinos combined in one central location). These racinos divert winnings from their casinos to their horse races in order to offer better purses for the riders and horse owners. When horse owners, breeders, and experienced riders catch wind of these bigger purses, they leave Kentucky and follow the money. Kentucky horse racing officials have already began reporting losses from the migration of breeders and riders to other states.
Plain and simple, Indiana racinos attract business from Kentucky and Ohio is theatening to take some more business from us too if they open up their own racinos. These are dollars that help our state economy. The General Assembly is allowing these funds, the funds that Kentucky needs right now during the economic collapse, to go to our neighboring states. Instead of these dollars being reinvested in Kentucky, they travel across the Ohio river and are reinvested in Indiana or in whichever state these dollars are spent. Could you imagine if these dollars stayed here in Kentucky? How many jobs would they create? How much tax revenue would they generate to the state of Kentucky?
By allowing racinos in the state, Kentucky can better compete with Indiana and Ohio. Indiana is already beginning to fear the actions that neighboring states will take regarding gaming as their state revenue depends heavily on their government-sanctioned casinos. Indiana has long said that the state's loss of gaming revenue from state competition is not a matter of "if it will happen" but "when it will happen". Their prophecy is coming true as both Kentucky and Ohio have considered allowing racino legislation.
Most people who are opposed to allowing expanded gaming at horse racing facilities argue that gambling is regressive (disproportionately affects the poor) and that including gaming at such harrowed places like Keeneland and Church Hill Downs will compromise the beauty of these places.
In regards to the first argument, I personally don't feel that government should take a paternalistic approach to making laws. That is to say that government should not act like a parent and decide what is best for it's citizens. I have always appreciated the tenets of Social Darwinism (not to be confused with Darwinism); only the most resourceful survive in this world. In my opinion, if you are foolish enough to go out and gamble away all of your paycheck or wager and lose your house on a game of roulette or black jack, that is your decision and you should have to pay the consequences, not myself or anyone else for that matter.
I know that opens a Pandora's box of responses, especially if the actions of said addicted gambler also affect members his or her family. In this situation, I do not think those family members should be punished equally for the actions of the addicted gambler, otherwise warranting some form of assistance.
If people are concerned about the beauty of these historic racing sites, there are ways to provide gaming and horse racing at one location, but still not compromise these buildings. Establishing casinos on site (but not attached to) of these historic places will provide casinos near the horse racing action and at the same time leave the racing facilities fully intact and without alteration. And besides, at least gambling will save these historic horse racing sites by drawing back those breeders, owners, and riders that left in the first place.
I take pride in my Kentucky heritage, especially around Derby time. When people think "Kentucky", they think bourbon, basketball, and thorough-bred horses. Bourbon has remained unchanged since it was first created in Bourbon County, Kentucky in the 18th Century. With the addition of Coach John Calipari to the Kentucky basketball program, Kentucky basketball is back on track to being the dynasty it once was. With the addition of gambling at horse racing sites, Kentucky can work to preserve it's proud heritage of horse racing and take back what our neighboring states have stolen from us; our thorough-breds, our breeders, our riders, and our money. This is not an issue of gambling, this is an issue of Kentucky Pride.
Kentucky has a proud heritage of horse breeding and horse racing. I can remember going to races at Keeneland Downs in Lexington, Kentucky and seeing the immaculate grounds at Church Hill Downs in Louisville, Kentucky. The Kentucky Derby is one of the most watched cultural-sporting events in the U.S.
However, the General Assembly's decision to not allow gaming at race tracks is hurting the purse winnings in Kentucky's horse racing and the overall talent that races in Kentucky. Our Kentucky tradition is under fire from neighboring states that allow facilities to offer horse racing as well as casinos.
Our neighboring states, most notably, Indiana and Pennsylvania, have what are called "racinos" (horse racing and casinos combined in one central location). These racinos divert winnings from their casinos to their horse races in order to offer better purses for the riders and horse owners. When horse owners, breeders, and experienced riders catch wind of these bigger purses, they leave Kentucky and follow the money. Kentucky horse racing officials have already began reporting losses from the migration of breeders and riders to other states.
Plain and simple, Indiana racinos attract business from Kentucky and Ohio is theatening to take some more business from us too if they open up their own racinos. These are dollars that help our state economy. The General Assembly is allowing these funds, the funds that Kentucky needs right now during the economic collapse, to go to our neighboring states. Instead of these dollars being reinvested in Kentucky, they travel across the Ohio river and are reinvested in Indiana or in whichever state these dollars are spent. Could you imagine if these dollars stayed here in Kentucky? How many jobs would they create? How much tax revenue would they generate to the state of Kentucky?
By allowing racinos in the state, Kentucky can better compete with Indiana and Ohio. Indiana is already beginning to fear the actions that neighboring states will take regarding gaming as their state revenue depends heavily on their government-sanctioned casinos. Indiana has long said that the state's loss of gaming revenue from state competition is not a matter of "if it will happen" but "when it will happen". Their prophecy is coming true as both Kentucky and Ohio have considered allowing racino legislation.
Most people who are opposed to allowing expanded gaming at horse racing facilities argue that gambling is regressive (disproportionately affects the poor) and that including gaming at such harrowed places like Keeneland and Church Hill Downs will compromise the beauty of these places.
In regards to the first argument, I personally don't feel that government should take a paternalistic approach to making laws. That is to say that government should not act like a parent and decide what is best for it's citizens. I have always appreciated the tenets of Social Darwinism (not to be confused with Darwinism); only the most resourceful survive in this world. In my opinion, if you are foolish enough to go out and gamble away all of your paycheck or wager and lose your house on a game of roulette or black jack, that is your decision and you should have to pay the consequences, not myself or anyone else for that matter.
I know that opens a Pandora's box of responses, especially if the actions of said addicted gambler also affect members his or her family. In this situation, I do not think those family members should be punished equally for the actions of the addicted gambler, otherwise warranting some form of assistance.
If people are concerned about the beauty of these historic racing sites, there are ways to provide gaming and horse racing at one location, but still not compromise these buildings. Establishing casinos on site (but not attached to) of these historic places will provide casinos near the horse racing action and at the same time leave the racing facilities fully intact and without alteration. And besides, at least gambling will save these historic horse racing sites by drawing back those breeders, owners, and riders that left in the first place.
I take pride in my Kentucky heritage, especially around Derby time. When people think "Kentucky", they think bourbon, basketball, and thorough-bred horses. Bourbon has remained unchanged since it was first created in Bourbon County, Kentucky in the 18th Century. With the addition of Coach John Calipari to the Kentucky basketball program, Kentucky basketball is back on track to being the dynasty it once was. With the addition of gambling at horse racing sites, Kentucky can work to preserve it's proud heritage of horse racing and take back what our neighboring states have stolen from us; our thorough-breds, our breeders, our riders, and our money. This is not an issue of gambling, this is an issue of Kentucky Pride.
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