Who doesn’t love a freebie? Who does not get a thrill of good fortune by finding money in the street, no matter how insignificant the amount? We may not believe in the Tooth Fairy, but many of us believe we have a rich benevolent uncle, Uncle Sam, who is willing to lavish upon us his wealth if only we would ask. The sad truth is that Uncle Sam is not rich, but penniless and is running a ponzi scheme that would make Bernie Madoff blush.
Health Care for $20
One of the major reasons that health care costs are rising out of control is that no one is minding the store. While Washington twists itself in knots to rearrange deck chairs on the Titanic of health care, we have little to no say in how our health care dollars are spent. Our health care “insurance” system is not really insurance. Insurance is meant to protect us from a financial catastrophe. Going to the doctor for a checkup is not a catastrophe. Paying a $20 co-pay for that checkup is like finding money on the street. There is no way anyone can get a physical exam, except by a hooker, for $20. It is a good idea to get a physical checkup every year? Yes, then pay the bill and ask what you are paying for and make sure you need it. You take your car in for service don’t you? Do you file an insurance claim when you do? Can you get it done for $20. Let’s get real. What we have is called third party payer and when someone else is picking up the tab, do we care what it costs? Really? But someone is picking up the tab. Look in your other pocket, because you are. If you are generally healthy and you get your annual checkup, your insurance premium (here in New York at least) will probably run around $10,000 per year. But, hey, you only paid $20 for that physical! What if you paid the full amount for the physical, say, $500. What if your insurance premium was cut to $5,000 because you would pay most routine medical costs out of your pocket and what if you could put the $4,500 left over ($10,000 original premium, minus $5,000 current premium, minus $500 cost of checkup), into a tax free account that can be used for future medical expenses or retirement if you don’t use it? If you are a young person and stay healthy into your mid-40s, you would have accumulated over $90,000 in your medical savings account and you still have catastrophic insurance coverage and the government stays out of the picture.
Retirement for Free
Like many well intentioned Government programs, Social Security, enacted during the Great Depression, seemed like a good idea at the time. When enacted there was about 15 workers paying in for each recipient drawing out. Today there are about a little over 3 workers paying in for each beneficiary. Bernie Madoff would blush at the audacity of it. On top of that the money that is paid into Social Security can only be “invested” in Treasury Securities so the return is lousy, but safe. People reacted to Social Security by saving less because the government safety net was there. Had people been encouraged to save for their own retirement, they would not be leaving their children this legacy of a ticking time bomb. So today, many young people feel the government’s hand in their pocket when they look at the FICA line on their pay stub, but don’t believe they will ever get a penny back. Nice concept.
Bring Home the Bacon!
What’s the measure of a good Congressman or Senator? Bringing home pork for the district, no? If you are like me, you get flyers every year or several times per year, touting how Congresswoman Jones obtained federal funding for that pier at the amusement park. With 435 Congressmen you can count on this, for each $1 that your Representative brings home $434 leaves the Treasury for each of the other Congressional districts and probably more, depending on the power and seniority of your Representative. Guess who’s paying for that Turtle Crossing in Florida? that bridge to nowhere in Alaska? that airport in Johnstown, PA that no one uses? That’s right, you are. What if we decided locally if we really needed a pier at the amusement park, and if we did, pay for it ourselves? Then we could let the people of Florida decide if they want to build a turtle crossing, the people of Alaska decide if they wanted a bridge to nowhere and the people of Pennsylvania decide if they wanted an airport that no one used. Then we could cut federal taxes by an equal amount to keep them out of mischief and help us pay for these projects if we really wanted them.
Let’s Get Organized
There was a time in our history where labor unions performed a valuable service. In those times when many industrial jobs were unskilled or semi-skilled, employers could dismiss someone on a whim and replace them within the hour. Unions gave those workers some counterbalancing power and fairer treatment. Today, we have a much more sophisticated economy and workers have more skills and mobility. Union membership has declined accordingly, in the private sector at least. Why is union membership still growing in the public sector? What is different about workers in the public sector that they still need unions? Are we suggesting that all government workers are unskilled? Why do teachers need a union? Are they not skilled such that they could sell their services to the highest bidder? Why do unions fight merit pay for teachers? Why are school principals, the de facto CEO of the school and who in New York easily make six figures, unionized? Do you get an idea why our K-12 public school system is trailing the world in performance?
In Michigan, privately owned small businesses that provided day-care services suddenly discovered that they were part of a union and union dues were being withheld from their government contractual payments.
Ms. Berry owns her own business—yet the Michigan Department of Human Services claims she is a government employee and union member. The agency thus withholds union dues from the child-care subsidies it sends to her on behalf of her low-income clients. Those dues are funneled to a public-employee union that claims to represent her. The situation is crazy—and it’s happening elsewhere in the country.
Ms. Berry, runs “The Berry Patch” a private day care center she operates from her home catering to low income clients. The money that was once paid to her, now goes to a union that does little for her. She is “self employed and wants nothing to do with the union.” Don’t you think we need more of these tactics in America? Card Check anyone?
Going Postal
And let’s not forget the Postal Service. As postal rates are again scheduled to increase on January 4, let’s look at this paragon of efficiency, that is actually authorized by the Constitution. In 2008, the Postal Service lost $3 billion, and the Postmaster General John Potter pulled down $800,000 in compensation including $135,000 in incentive bonuses. What do we have to pay this guy if he actually breaks even? Also, let us not forget this is also a very heavily unionized operation.
Don’t Worry, You Won’t Feel a Thing
During World War II, FDR needed to raise more revenue to pay for the war. Fearing a backlash, his team hit upon the idea of payroll withholding. Knowing the potential backlash that would result when taxpayers had to write that big check on April 15th, he rightly figured that if he took a little bit each week, he could take a lot more in total. Statists in Washington have never looked back. It’s like the tax that was imposed on telephone service to pay for the Spanish American War that is still in place today. Instead of picking our pockets every week, what do you think most Americans would say about the size of the federal government if they had to write one big check on April 15th? There would be no tax rebates, because there would be no tax withheld. Do you think Americans would force Congress to sharpen their pencils and scale back the size of government?
Help is On the Way
Ronald Reagan said, “The nine most terrifying words in the English language are, ‘I’m from the government and I’m here to help!’” But perhaps the best example of how far from our founding principles our government has strayed comes from Congresswoman Rosa DeLauro of Connecticut as she spoke during a House End of Year Wrap Up Session:
“This House–we understand, we’re there,” she said. “You can count on us because we believe that it’s our moral responsibility to make sure that you and your family need our help.”
I don’t know about you, but I don’t need the House of Representatives making sure I need their help. I need as little interference as possible from them. Their meddlesome intrusions in our lives is killing what made this country great. It is a point we cannot make often enough.
