Commentary Magazine


Topic: health-care law

Flotsam and Jetsam

AP reports: “Egypt’s government on Tuesday extended the country’s controversial emergency law for another two years, saying it would limit its use, a promise dismissed by human rights activists who warned the law would continue to be used to suppress dissent.” Will Obama be “deeply concerned” or zoom all the way to “profoundly troubled”?

Alan Dershowitz on Richard Goldstone’s “I was just following the law” defense of his record as a “hanging” apartheid judge: “It is interesting that Goldstone made a similar argument to friends as to why he accepted the chairmanship of the investigative commission offered to him by the United Nations Human Rights Council. He acknowledged that the Council was biased against Israel. Indeed, it treats Israel much the way Apartheid courts used to treat Black Africans: Just as there was special justice (really injustice) for blacks, so too there is special justice (really injustice) for Israel. Goldstone claims he took the job ‘to help Israel,’ just as he took his previous job to help blacks. In both cases he cynically hurt those he said he wanted to help while helping only himself. In both cases he was selected to legitimate bigotry. In both cases, better people than him refused to lend their credibility to an illegitimate enterprise. But Goldstone accepted, because it was good for his career.” Read the whole thing.

Dan Gerstein on the Kagan sales pitch: “This week, with their over-hyped and off-key ‘real world’ sales pitch for Supreme Court nominee Elena Kagan, the president’s team is doing a bang-up job of outing their blinds spots themselves. In doing so, they are providing a big open window into why Obama continues to struggle in connecting with working-class voters.”

Megan McArdle on Kagan’s “pitch-perfect blandness”: “What’s disturbing is that this is what our nomination process now selects for: someone who appears to be in favor of nothing except self-advancement. Then we complain when the most passionate advocates for ideas are the lunatic fringe.”

Steve Kornacki asks, “Should Specter have run as an independent?” He still can!

Charles Krauthammer on Specter’s dilemma having voted against Kagan for solicitor general: “You almost feel sorry for Arlen Specter. I mean: Almost. This is a guy of so many twists and turns and retreats and swerves and reverses. It reminds me of a line in a Graham Greene novel where he speaks of his protagonist who says: ‘I prefer to tell the truth. It’s easier to memorize.’ Specter‘s got a lot of memorizing to do.”

Oops: “Congressional budget referees say President Barack Obama’s new health care law could potentially add another $115 billion over 10 years to government health care spending. If Congress approves all the additional spending, that would push the 10-year cost of the overhaul above $1 trillion — an unofficial limit the Obama administration set early on. The Congressional Budget Office said Tuesday the added spending includes $10 billion to $20 billion in administrative costs to federal agencies carrying out the law, as well as $34 billion for community health centers and $39 billion for American Indian health care.”

But most voters have already figured that out: “The number of U.S. voters who expect the recently passed health care bill to increase the federal deficit is at its highest level yet, and most voters continue to favor its repeal. The latest Rasmussen Reports national telephone survey of Likely Voters shows 63% now believe the health care reform legislation signed into law is likely to increase the federal deficit. That’s up four points from last week.”

AP reports: “Egypt’s government on Tuesday extended the country’s controversial emergency law for another two years, saying it would limit its use, a promise dismissed by human rights activists who warned the law would continue to be used to suppress dissent.” Will Obama be “deeply concerned” or zoom all the way to “profoundly troubled”?

Alan Dershowitz on Richard Goldstone’s “I was just following the law” defense of his record as a “hanging” apartheid judge: “It is interesting that Goldstone made a similar argument to friends as to why he accepted the chairmanship of the investigative commission offered to him by the United Nations Human Rights Council. He acknowledged that the Council was biased against Israel. Indeed, it treats Israel much the way Apartheid courts used to treat Black Africans: Just as there was special justice (really injustice) for blacks, so too there is special justice (really injustice) for Israel. Goldstone claims he took the job ‘to help Israel,’ just as he took his previous job to help blacks. In both cases he cynically hurt those he said he wanted to help while helping only himself. In both cases he was selected to legitimate bigotry. In both cases, better people than him refused to lend their credibility to an illegitimate enterprise. But Goldstone accepted, because it was good for his career.” Read the whole thing.

Dan Gerstein on the Kagan sales pitch: “This week, with their over-hyped and off-key ‘real world’ sales pitch for Supreme Court nominee Elena Kagan, the president’s team is doing a bang-up job of outing their blinds spots themselves. In doing so, they are providing a big open window into why Obama continues to struggle in connecting with working-class voters.”

Megan McArdle on Kagan’s “pitch-perfect blandness”: “What’s disturbing is that this is what our nomination process now selects for: someone who appears to be in favor of nothing except self-advancement. Then we complain when the most passionate advocates for ideas are the lunatic fringe.”

Steve Kornacki asks, “Should Specter have run as an independent?” He still can!

Charles Krauthammer on Specter’s dilemma having voted against Kagan for solicitor general: “You almost feel sorry for Arlen Specter. I mean: Almost. This is a guy of so many twists and turns and retreats and swerves and reverses. It reminds me of a line in a Graham Greene novel where he speaks of his protagonist who says: ‘I prefer to tell the truth. It’s easier to memorize.’ Specter‘s got a lot of memorizing to do.”

Oops: “Congressional budget referees say President Barack Obama’s new health care law could potentially add another $115 billion over 10 years to government health care spending. If Congress approves all the additional spending, that would push the 10-year cost of the overhaul above $1 trillion — an unofficial limit the Obama administration set early on. The Congressional Budget Office said Tuesday the added spending includes $10 billion to $20 billion in administrative costs to federal agencies carrying out the law, as well as $34 billion for community health centers and $39 billion for American Indian health care.”

But most voters have already figured that out: “The number of U.S. voters who expect the recently passed health care bill to increase the federal deficit is at its highest level yet, and most voters continue to favor its repeal. The latest Rasmussen Reports national telephone survey of Likely Voters shows 63% now believe the health care reform legislation signed into law is likely to increase the federal deficit. That’s up four points from last week.”

Read Less

Why Waxman Decided Against a Bully-athon

Daily Caller reports that Rep. Henry Waxman decided against a hearing to excoriate business executives for recording tax losses attributable to ObamaCare. The reason: not only did the companies have a legal obligation to do so (had they not, Sen. Carl Levin would no doubt be hauling them before his committee one day to decry the fraud on the shareholders); they also would have produced some very embarrassing evidence that ObamaCare is going to drive up health-care costs. The report explains:

Most significantly, documents unearthed by the investigation highlight companies that are considering dumping employees from their current health-care plans in the face of new costs from the health-care law. President Obama repeatedly promised his health-care law would let Americans keep their current insurance if they’re happy with it.

A March 3 internal Verizon memo on the impact health-care law said new taxes on insurance companies and health-care equipment manufacturers will be passed onto employers through higher prices.

Facing such increased costs, employers like Verizon “may consider exiting the health-care market and send employees to the exchanges,” the memo says.

Under the law, companies would pay fines for not providing insurance companies coverage. But, the Verizon memo said, the fines would be “modest” compared to providing coverage for employees.

In a March 25 e-mail, John Deere’s director of labor relations, Kenneth Hugh, said, “We ought to look at … denying coverage and just paying the penalty … we would need to figure out which one was more expensive.” John Deere faces a unique situation because of contracts with its unionized workers.

Whether or not companies are being forced to rescind employee coverage, they may need to raise insurance premiums, the documents show.

The top human resources official at Caterpillar said in a March 23 e-mail that the company will need to “figure out what this will cost us and collect that in increased premiums which we will attribute to the legislation”

Oops. Wrong answer. Bag the hearing. It seems that ObamaCare opponents would do well to get one or more of these execs in front of a committee and let them tell the American people what Obama and Waxman won’t — that ObamaCare isn’t going to guarantee they can keep their insurance and it is going to cost them a bundle. Republicans argue that divided government is needed to check Obama’s leftist agenda. As Waxman’s gambit shows, it’s also the only way to achieve congressional oversight.

Daily Caller reports that Rep. Henry Waxman decided against a hearing to excoriate business executives for recording tax losses attributable to ObamaCare. The reason: not only did the companies have a legal obligation to do so (had they not, Sen. Carl Levin would no doubt be hauling them before his committee one day to decry the fraud on the shareholders); they also would have produced some very embarrassing evidence that ObamaCare is going to drive up health-care costs. The report explains:

Most significantly, documents unearthed by the investigation highlight companies that are considering dumping employees from their current health-care plans in the face of new costs from the health-care law. President Obama repeatedly promised his health-care law would let Americans keep their current insurance if they’re happy with it.

A March 3 internal Verizon memo on the impact health-care law said new taxes on insurance companies and health-care equipment manufacturers will be passed onto employers through higher prices.

Facing such increased costs, employers like Verizon “may consider exiting the health-care market and send employees to the exchanges,” the memo says.

Under the law, companies would pay fines for not providing insurance companies coverage. But, the Verizon memo said, the fines would be “modest” compared to providing coverage for employees.

In a March 25 e-mail, John Deere’s director of labor relations, Kenneth Hugh, said, “We ought to look at … denying coverage and just paying the penalty … we would need to figure out which one was more expensive.” John Deere faces a unique situation because of contracts with its unionized workers.

Whether or not companies are being forced to rescind employee coverage, they may need to raise insurance premiums, the documents show.

The top human resources official at Caterpillar said in a March 23 e-mail that the company will need to “figure out what this will cost us and collect that in increased premiums which we will attribute to the legislation”

Oops. Wrong answer. Bag the hearing. It seems that ObamaCare opponents would do well to get one or more of these execs in front of a committee and let them tell the American people what Obama and Waxman won’t — that ObamaCare isn’t going to guarantee they can keep their insurance and it is going to cost them a bundle. Republicans argue that divided government is needed to check Obama’s leftist agenda. As Waxman’s gambit shows, it’s also the only way to achieve congressional oversight.

Read Less

Enron Accounting, Obama-Style

James Klein of the American Benefits Council writes in opposition to the attacks by the administration and Rep. Henry Waxman that corporations’ write-downs of losses due to ObamaCare are some sort of political scare tactics:

The new health-care law contains two sentences that change the tax treatment of a subsidy originally crafted in 2003 when Congress established the Medicare prescription drug program. As a result, companies must now impose on their financial statements the present value of their entire new future tax liability. The Obama administration’s position is a) that the original tax provision was actually a “loophole,” and b) that companies are acting irresponsibly by refusing to acknowledge the overall cost savings associated with the new law.

Notwithstanding the unusual tax treatment in the original provision, the bottom line is indisputable: The subsidy exists for the express purpose of saving the government money by keeping retirees on company prescription drug plans rather than having them enroll in the Medicare drug plan. Now that Congress has reversed the policy, corporations must report eye-popping charges on their financial statements.

As Klein notes, it is the frenzied ObamaCare defenders who are playing politics with the tax code, and worse — berating corporations to defraud shareholders. (“As for the government’s assertion that companies are failing to adequately account for all the savings they will enjoy from health-care reform, isn’t that exactly the kind of “creative” accounting that got Enron in trouble?”)

This is the administration that promised to take the politics out of science and the ideology out of foreign policy. But in fact everything — including the tax code — is merely part of the Chicago machine, which threatens to mow down any rule, any entity, and any critic standing in its way. Lacking internal restraint and humility, this administration and the country would surely benefit from some robust legislative scrutiny and oversight. The voters in November will have an opportunity to check the voracious power of an administration of bullies.

James Klein of the American Benefits Council writes in opposition to the attacks by the administration and Rep. Henry Waxman that corporations’ write-downs of losses due to ObamaCare are some sort of political scare tactics:

The new health-care law contains two sentences that change the tax treatment of a subsidy originally crafted in 2003 when Congress established the Medicare prescription drug program. As a result, companies must now impose on their financial statements the present value of their entire new future tax liability. The Obama administration’s position is a) that the original tax provision was actually a “loophole,” and b) that companies are acting irresponsibly by refusing to acknowledge the overall cost savings associated with the new law.

Notwithstanding the unusual tax treatment in the original provision, the bottom line is indisputable: The subsidy exists for the express purpose of saving the government money by keeping retirees on company prescription drug plans rather than having them enroll in the Medicare drug plan. Now that Congress has reversed the policy, corporations must report eye-popping charges on their financial statements.

As Klein notes, it is the frenzied ObamaCare defenders who are playing politics with the tax code, and worse — berating corporations to defraud shareholders. (“As for the government’s assertion that companies are failing to adequately account for all the savings they will enjoy from health-care reform, isn’t that exactly the kind of “creative” accounting that got Enron in trouble?”)

This is the administration that promised to take the politics out of science and the ideology out of foreign policy. But in fact everything — including the tax code — is merely part of the Chicago machine, which threatens to mow down any rule, any entity, and any critic standing in its way. Lacking internal restraint and humility, this administration and the country would surely benefit from some robust legislative scrutiny and oversight. The voters in November will have an opportunity to check the voracious power of an administration of bullies.

Read Less

And Then the Deluge

Like the French aristocracy pre-1789 and the flappers pre-Crash, the Democrats are whooping it up. Thrilled with their own cleverness and accomplishments, they have taken several victory laps. But wait. Even the New York Times warns: there is a black cloud on the horizon that threatens not only their future but also the viability of their “accomplishment”:

Achievement of their decades-long quest for comprehensive health care legislation left Congressional leaders and White House aides jubilant. It broke, at least temporarily, the psychology of failure that threatened President Obama’s administration as it had burdened President George W. Bush’s tenure. But the new spring in the steps of Democratic lawmakers has not reversed the likelihood that there will be fewer of them next year. Mr. Obama’s signature on the health care law did not reduce a national unemployment rate that hovers around double digits and is likely to stay there through the November elections.

The Gray Lady repeats the favored line — this “stabilized” support on the Left — but can’t conceal the fact that this is of minimal value. After all, there weren’t enough liberals to save even Scott Brown in Massachusetts from the united front of independents and conservatives. Moreover, “Younger and minority voters, so crucial to Mr. Obama’s 2008 breakthrough, typically turn out for midterms at lower rates than seniors, the age group most skeptical of the president’s performance and the country’s direction.” In other words, the Obami have pleased people (including the uninsured, the target of ObamaCare) not all that inclined to vote.

So what are Democrats to do? Change the subject: “Democrats will turn unequivocally to the economy, putting forward additional efforts to accelerate the recovery and highlighting improvements already under way.” What — they don’t want to dwell on their victory? One would think that would be their sole topic of discussion, you know, what with the historic accomplishment under their belts. But no, they seem quite anxious to move on.

They repeat the mantra that cramming a grossly unpopular health-care bill through on a narrow party-line vote was a good idea. (“By winning on health care, Mr. Obama and his party ‘avoided disaster’ in 2010, said the Democratic pollster Mark Mellman. But ‘this doesn’t change the overall dynamic.’”) This unproved thesis is apparently providing them some solace as they stare into the political abyss. But the election is not merely a disagreeable ordeal. It is also a referendum on their handiwork, which threatens not only to result in a massive repudiation of their “historic” gain but also to begin the process of obliterating it. The Democrats could defy the will of the voters once, but neither they nor their legislation can survive cycle after cycle of the voters’ wrath. They now might want to change the topic, but the voters don’t. The partying will end, I suspect, once the reality of the electorate’s anger sets in and the recognition dawns that, like those of the flappers and the French monarchy, the days of ObamaCare are numbered.

Like the French aristocracy pre-1789 and the flappers pre-Crash, the Democrats are whooping it up. Thrilled with their own cleverness and accomplishments, they have taken several victory laps. But wait. Even the New York Times warns: there is a black cloud on the horizon that threatens not only their future but also the viability of their “accomplishment”:

Achievement of their decades-long quest for comprehensive health care legislation left Congressional leaders and White House aides jubilant. It broke, at least temporarily, the psychology of failure that threatened President Obama’s administration as it had burdened President George W. Bush’s tenure. But the new spring in the steps of Democratic lawmakers has not reversed the likelihood that there will be fewer of them next year. Mr. Obama’s signature on the health care law did not reduce a national unemployment rate that hovers around double digits and is likely to stay there through the November elections.

The Gray Lady repeats the favored line — this “stabilized” support on the Left — but can’t conceal the fact that this is of minimal value. After all, there weren’t enough liberals to save even Scott Brown in Massachusetts from the united front of independents and conservatives. Moreover, “Younger and minority voters, so crucial to Mr. Obama’s 2008 breakthrough, typically turn out for midterms at lower rates than seniors, the age group most skeptical of the president’s performance and the country’s direction.” In other words, the Obami have pleased people (including the uninsured, the target of ObamaCare) not all that inclined to vote.

So what are Democrats to do? Change the subject: “Democrats will turn unequivocally to the economy, putting forward additional efforts to accelerate the recovery and highlighting improvements already under way.” What — they don’t want to dwell on their victory? One would think that would be their sole topic of discussion, you know, what with the historic accomplishment under their belts. But no, they seem quite anxious to move on.

They repeat the mantra that cramming a grossly unpopular health-care bill through on a narrow party-line vote was a good idea. (“By winning on health care, Mr. Obama and his party ‘avoided disaster’ in 2010, said the Democratic pollster Mark Mellman. But ‘this doesn’t change the overall dynamic.’”) This unproved thesis is apparently providing them some solace as they stare into the political abyss. But the election is not merely a disagreeable ordeal. It is also a referendum on their handiwork, which threatens not only to result in a massive repudiation of their “historic” gain but also to begin the process of obliterating it. The Democrats could defy the will of the voters once, but neither they nor their legislation can survive cycle after cycle of the voters’ wrath. They now might want to change the topic, but the voters don’t. The partying will end, I suspect, once the reality of the electorate’s anger sets in and the recognition dawns that, like those of the flappers and the French monarchy, the days of ObamaCare are numbered.

Read Less

RE: RE: ObamaCare Hits Home

This report begins to tally up the immediate hit on American employers from ObamaCare:

In the wake of Washington’s health-care overhaul, some companies are taking big one-time charges for anticipated costs, fanning tension with the administration over the legislation’s impact on corporate America.

Three companies that were among vocal opponents of the legislation have warned they would see an immediate impact on their earnings as a result of the loss of deductions on tax-free subsidies they receive for providing retiree prescription-drug benefits.

On Thursday, Deere & Co. said it would take a $150 million one-time charge in the current quarter related to the loss of deductions. Earlier in the week, Caterillar Inc. reported a $100 million charge and AK Steel recorded a $31 million charge.

Beginning in 2006, companies have received a 28% federal subsidy, up to $1,330 per retiree, tax-free, to help pay for prescription-drug coverage. Until now, companies could deduct the subsidy from their taxes, essentially getting a second benefit from the money. Under the new law, companies will no longer be able to deduct the subsidy, but it remains tax-free.

Although the changes don’t go into effect until 2013, companies say they have to take the charge to earnings now, to reflect the loss of the future tax deductions. In all, the S&P 500 companies will take a combined hit of $4.5 billion to first-quarter earnings, estimates David Zion, an analyst with Credit Suisse. [emphasis added]

That is right — $5.4 billion from a single tax change, money that can’t be invested in new plants or used to hire new workers. The administration’s reaction? Commerce Secretary Gary Locke says, “It is simply not responsible to suggest that the new health-care law is bad for business.” These companies have a legal obligation to accurately assess earnings, so what would Locke have them do — conceal the hit and risk lawsuits from shareholders and prosecution by his colleagues at the SEC? It’s absurd to suggest that businesses that will suffer from the mandates, fines, and taxes imposed should essentially shut up about the adverse consequences of the legislation.

Robert Gibbs adds to the air of dismissiveness, saying, “Companies not only get the subsidy tax-free, but they then deduct the amount. Our bill simply closes the loophole.” Yes, by White House standards, raising taxes by $5.4B is no more than a loophole. If you have the sense that no one in the White House has much sympathy for or understands private industry, you are right. If they did, we would not now be facing a gargantuan tax hike — and more to follow with the expiration of the Bush tax cuts.

This report begins to tally up the immediate hit on American employers from ObamaCare:

In the wake of Washington’s health-care overhaul, some companies are taking big one-time charges for anticipated costs, fanning tension with the administration over the legislation’s impact on corporate America.

Three companies that were among vocal opponents of the legislation have warned they would see an immediate impact on their earnings as a result of the loss of deductions on tax-free subsidies they receive for providing retiree prescription-drug benefits.

On Thursday, Deere & Co. said it would take a $150 million one-time charge in the current quarter related to the loss of deductions. Earlier in the week, Caterillar Inc. reported a $100 million charge and AK Steel recorded a $31 million charge.

Beginning in 2006, companies have received a 28% federal subsidy, up to $1,330 per retiree, tax-free, to help pay for prescription-drug coverage. Until now, companies could deduct the subsidy from their taxes, essentially getting a second benefit from the money. Under the new law, companies will no longer be able to deduct the subsidy, but it remains tax-free.

Although the changes don’t go into effect until 2013, companies say they have to take the charge to earnings now, to reflect the loss of the future tax deductions. In all, the S&P 500 companies will take a combined hit of $4.5 billion to first-quarter earnings, estimates David Zion, an analyst with Credit Suisse. [emphasis added]

That is right — $5.4 billion from a single tax change, money that can’t be invested in new plants or used to hire new workers. The administration’s reaction? Commerce Secretary Gary Locke says, “It is simply not responsible to suggest that the new health-care law is bad for business.” These companies have a legal obligation to accurately assess earnings, so what would Locke have them do — conceal the hit and risk lawsuits from shareholders and prosecution by his colleagues at the SEC? It’s absurd to suggest that businesses that will suffer from the mandates, fines, and taxes imposed should essentially shut up about the adverse consequences of the legislation.

Robert Gibbs adds to the air of dismissiveness, saying, “Companies not only get the subsidy tax-free, but they then deduct the amount. Our bill simply closes the loophole.” Yes, by White House standards, raising taxes by $5.4B is no more than a loophole. If you have the sense that no one in the White House has much sympathy for or understands private industry, you are right. If they did, we would not now be facing a gargantuan tax hike — and more to follow with the expiration of the Bush tax cuts.

Read Less




Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor to our site, you are allowed 8 free articles this month.
This is your first of 8 free articles.

If you are already a digital subscriber, log in here »

Print subscriber? For free access to the website and iPad, register here »

To subscribe, click here to see our subscription offers »

Please note this is an advertisement skip this ad
Clearly, you have a passion for ideas.
Subscribe today for unlimited digital access to the publication that shapes the minds of the people who shape our world.
Get for just
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor, you are allowed 8 free articles.
This is your first article.
You have read of 8 free articles this month.
YOU HAVE READ 8 OF 8
FREE ARTICLES THIS MONTH.
for full access to
CommentaryMagazine.com
INCLUDES FULL ACCESS TO:
Digital subscriber?
Print subscriber? Get free access »
Call to subscribe: 1-800-829-6270
You can also subscribe
on your computer at
CommentaryMagazine.com.
LOG IN WITH YOUR
COMMENTARY MAGAZINE ID
Don't have a CommentaryMagazine.com log in?
CREATE A COMMENTARY
LOG IN ID
Enter you email address and password below. A confirmation email will be sent to the email address that you provide.