Monday, February 28, 2011

Class Warfare

At a time when the long term solvency of Social Security is very much in question it is revealing to shed a little light on one provision of PPACA which is publicized far to Little and that is The CLASS Act (Community Living Assistance Services and Support Act). Yes, it seems Obamacare included a voluntary taxpayer optional long term care program that owes its origins to Ted Kennedy.

Whats wrong with that you might ask? Well for starters the design more or less mirrors the group guaranteed issue approach to LTC which has failed miserably for over 20 years in the private sector to the point where John Hancock has exited the group market along with MetLife and anyone else with a board or stockholders because its simply not profitable. Not only is it not profitable it is financially unsustainable. Imagine a wave of baby boomers faced with financial ruin from outliving their bodies ability to perform acitivities of daily living like bathing, dressing, eating, and transferring. All they have to do is enroll and pay premiums for 5 years and be actively at work for 3 years and they can receive a cash LTC benefit. And hey, the premiums are only expected to be $123 per month! What a deal!  You see the exact benefits costs and program details are all being designed by the Secretary of Health and Human Services at this juncture. think we will see an LTC trust fund established like the SS Trust fund to keep Congress from spending the proceeds sorta like the SS Trust Fund?

But it gets better. Check out this "wisdom" from CBO emphasis mine;

Q: Are there any estimates now of what those premiums might be?

A: During the long course of the CLASS Act plan’s development, a number of estimates were made of the premiums that could be required for a financially sound plan. These estimates vary widely depending on the version of the law (which changed as it went through the legislative process) analyzed, the data and the assumptions used. Many commonly cited estimates reflect studies of much older versions of the CLASS Act. No analysis to date exactly matches the complete details of the CLASS plan that will be implemented, as these details have yet to be determined. As Congress debated the version of the CLASS Act that is now the law, the non-partisan Congressional Budget Office (the official “score-keeper”) provided estimates of average premiums. The Congressional Budget Office (CBO) estimated that average premiums would be $123/month (lower for younger people, higher for older people). Naturally, the CBO estimate included assumptions about some detailed elements of the program that might be different when the final plan is ultimately determined. In addition, the CBO assumed, among other things, that the CLASS Act plan would have relatively low enrollment, such as that found with private long-term care insurance.

To again use a parable from popular culture examine the picture above closely. This time its not a Baby Ruth. It is an actual turd. No amount of chlorine can sanitize a pool contaminated with feces. It must be drained and sanitized every time. Now notice what the CBO said about the CLASS risk pool in the 2nd to last sentence;the CLASS Act plan would have relatively low enrollment, such as that found with private long-term care insurance. I am certain CBO meant relatively low enrollment like group LTC on a guaranteed issue basis of the type that is not even marketed anymore due to adverse selection. Which means the pool will ultimately be a septic tank unfit to dip a toe into much less to swim in and every time the septic is collected the taxpayers get to replenish the pool with tax dollars in order to allow allow Americans to have access to LTC. There is not a reinsurer who would ever insure such a risk but there is on the other hand a Democratic Party in America who did on a party line reconciliation vote sign taxpayers up to insure the risk which is not voluntarily insurable on a guaranteed issue basis. And its means tested, so low income Americans get subsidized until every taxpayer is low income and then what?

I think CLASS is actually an acronym meaning Clueless Liberals Accessorizing Social Security. It is a mind numbing subsection of PPACA stupidity to be implemented by bureaucrats at HHS. This is not even what Pelosi meant when she said we would have to read the bill to know whats in it because the final regulations are not due until October 1. 2012. At a time when we have the President & DNC carefully orchestrating union protests over collective bargaining rights and historic Federal, State & Local deficits we now have a  law created by politicians with a cognitive deficit that will insure all Americans go broke. Tell me this is not the same logic that brought us to a broken Social Security system? Why would we expect a different result this time? Remember that one difinition of insanity is repeating the same behavior and expecting a different result. Yet every time feces goes into the pool its contaminated so just keep Bill Murray in mind and remember this time its not a Baby Ruth.

Thursday, February 24, 2011

Federalist View Of Wisconsin & National Politics Instructive

The Federalist No. 10

The Utility of the Union as a Safeguard Against Domestic Faction and Insurrection (continued)

Daily Advertiser

Thursday, November 22, 1787

[James Madison]

To the People of the State of New York:

AMONG the numerous advantages promised by a well constructed Union, none deserves to be more accurately developed than its tendency to break and control the violence of faction. The friend of popular governments never finds himself so much alarmed for their character and fate, as when he contemplates their propensity to this dangerous vice. He will not fail, therefore, to set a due value on any plan which, without violating the principles to which he is attached, provides a proper cure for it. The instability, injustice, and confusion introduced into the public councils, have, in truth, been the mortal diseases under which popular governments have everywhere perished; as they continue to be the favorite and fruitful topics from which the adversaries to liberty derive their most specious declamations. The valuable improvements made by the American constitutions on the popular models, both ancient and modern, cannot certainly be too much admired; but it would be an unwarrantable partiality, to contend that they have as effectually obviated the danger on this side, as was wished and expected. Complaints are everywhere heard from our most considerate and virtuous citizens, equally the friends of public and private faith, and of public and personal liberty, that our governments are too unstable, that the public good is disregarded in the conflicts of rival parties, and that measures are too often decided, not according to the rules of justice and the rights of the minor party, but by the superior force of an interested and overbearing majority. However anxiously we may wish that these complaints had no foundation, the evidence, of known facts will not permit us to deny that they are in some degree true. It will be found, indeed, on a candid review of our situation, that some of the distresses under which we labor have been erroneously charged on the operation of our governments; but it will be found, at the same time, that other causes will not alone account for many of our heaviest misfortunes; and, particularly, for that prevailing and increasing distrust of public engagements, and alarm for private rights, which are echoed from one end of the continent to the other. These must be chiefly, if not wholly, effects of the unsteadiness and injustice with which a factious spirit has tainted our public administrations.

So Let me translate that for those among you who have a problem understanding 18th century English uncorrupted by slang or Ebonics.
  • Lets start with the title The Utility of the Union as a Safeguard Against Domestic Faction and Insurrection .  In other words it is the Union, the Federal Government Madison is offering as a structural protection against the danger of Faction.  Today we could call either party  a faction, especially the unique coalition of Unions, Progressives and various assorted left wing nut jobs that control the modern Democratic party.
  • Political Parties are a "dangerous vice" causing mortal disease to governments historically. Keep in mind The Federalist Papers were written anonymously under the pseudonym "Publius" so the reference here is Rome where today the food may be great but the government, not so much, but I digress.
  • It would be an unforgivable oversight to pretend the Constitution would be expected to stand up in the face of  a partisan majority  imposing their their will on the Nation to the detriment of the common good. Things like passing health care reform by Reconciliation by a party line vote for example. Fairly sure Mr Madison would have considered the Obama care vote to be a modern example of political parties run amuck. The emergence of the tea party and the landslide midterms sweeping Republicans into power are an indication the people have grown weary of party politics.
  • The Wisconsin minority Democratic party left the building to allow time for the unions and the democratic party and even the Presidents campaign organization to marshall protesters and bus them in from neighboring states to march for the camera's.Bereft of the intellectual underpinnings to to have an intelligent debate on financial matters other state democratic minorities soon followed. The progressive logic is akin to your Dad saying "do as I say not as I do" when he cannot or will not explain something. Think of Michelle Obama preaching diet while her husband steals a smoke. By the way progressives are in the cannot group which is why they resort to emotion instead of reason and logic or principle.Expedience is the currency of faction.
  • The unsteadiness and injustice by which a factious spirit has invaded our government is clear each day in the electronic or print media. In 2009 the 912 Rallies had no coverage except on Fox and among bloggers like me.
  • In 2011 Governor Walker in Wisconsin is vilified and the protesters are all over the television,every night. In 2011 Twitter and Facebook play key roles for organizers in Tunisia and Egypt because they do not trust their state run media either.
  • Yesterday we were all treated to an announcement that the Obama administration would not enforce the Defense of Marriage Act as it was unconstitutional. Contrast that with the reaction to PPACA being declared unconstitutional when the adminsitration immediately declared implementation would be ongoing. 
  • Yesterday President Obama finally commented on the situation in Libya where Qaddafi has been killing thousands of Libyans for over a week to condemn the violence. Qaddafi who ordered PanAm 103 to be destroyed killing 270 people. Qaddafi who financed the 1972 Olympics and the 1986 Berlin disco bombing that targeted American servicemen. So much for the bully pulpit. Recall that Reagan bombed Tripoli after the linkage to Qadafi but I digress we do not have a war on terror anymore. How could we have a war on terror when the President mobilizes his own campaign organization to protest in battleground 2012 states where Republican Governors and legislatures are trying to solve serious fiscal budget shortfalls that he completely ignored with his 2012 budget. I wonder what James Madison would think of such behavior?

Monday, February 21, 2011

Got EAP?

I was just a normal guy.

Life was just a nine to five.

With bills and pressure,

piled up to the sky.

She never asked,

'cause she knew I'd been,

hangin' with my wilder friends.

Lookin' for some other way to fly.

Three days straight was no big feat,

to get by on no food or sleep.

And crazy,

was becoming my new norm.

I'd pass out on the bedroom floor,

and sleep right through the calm before the storm.


My life was just an old routine.

Every day the same damn thing.

I couldn't even tell I was alive.

I tell you,

the high cost of livin',

ain't nothin' like the cost of livin' high.

That Southern Baptist parkin' lot,

was where I'd go to smoke my pot.

And sit there in my pick-up truck and pray.

Starin' at that giant cross,

just reminded me that I was lost.

And it just never seemed to point the way.

As soon as Jesus turned his back,

I'd find my way across the tracks.

Lookin' just to score another deal.

With my back up against that damn eight-ball,

I didn't have to think, or talk... or feel.


My whole life went through my head.

Layin' in that motel bed.

Watchin' as the cops kicked in the door.

I had a job and a piece of land.

My sweet wife was my best friend,

but I traded that for cocaine and a whore.

With my newfound sobriety,

I've got the time to sit and think...

Of all the things I had,

and threw away.

This prison is much colder than,

the one that I was locked up in...

Just yesterday.


I tell you,

the high cost of livin',

ain't nothin' like the cost of livin' high.

...just leave that stuff alone... (quietly during closing instrumental)

Why Employers Need 3rd Party Adjudication of Disability

Look at the Doctor using privacy laws as a basis for fraud. One doctor even points out this is what he does every day. If you rely on a doctors note as the basis for establishing a legitimate sick day or short term disability claim here is a little window into the culture which is created. For more check this prior post and this brief excerpt from my blog in 2007.

The International Foundation of Employee Benefit Plans recently completed a survey of their membership on Salary Continuation and Short Term Disability (STD) which you can find for free here.
The survey revealed that salary continuation/STD is the black hole of employee benefit plans in terms of quantifying cost and controlling utilization.
Reasons cited for the difficulty of quantifying cost and controlling utilization and effecting changes are;
1.Union Contracts

2.Employee perception of value (Did anyone explain the probability of disability and the impact on employees of a sickness or injury which prevents work?).

3.State Mandates like CA Paid leave (Huh?)

4.FMLA Integration ( the machine is so well oiled and automated it cannot be improved?)

5.Management Buy-in (Did anyone explain the facts and costs?)

6.Entitlement (getting warmer!)

7.A lenient culture that does not enforce return to work (getting hotter!)

8.Most of the plans are payroll matters not ERISA plans (red hot, since employer cannot enforce plan terms and win an ADA challenge since payroll plans are not bonafide employee benefit plans

Saturday, February 19, 2011

Some Perspective On Wisconsin

Is it not interesting that the Public sector is the last bastion in America for organized labor? Why is that? Could it be perhaps that several generations have watched all those great paying union jobs in the private sector move overseas where plenty of workers were perfectly willing to do the job for considerably less money? But you cannot really offshore education, law enforcement, fire fighting, etc.

 Yes Governor Walker is busting the union and he is doing so for the simple reason that all over the state of Wisconsin local governments will have the ability to tackle their own fiscal deficits.

Gov. Scott Walker on Friday rejected an offer from the head of the largest state workers union in which workers would give concession on benefits, but keep their collective bargaining rights.
"Doesn't work," Walker told Journal Sentinel reporters in his office Friday afternoon. "And the reason, having been a local government official, is we've got 72 counties, 424 school districts, over a thousand municpalities. And like every other state, or nearly every other state across the country, our budget is going to have cuts in aids to local governments."
Walker mentioned that states such as New York and California have had to cut billions in aid to schools.
"My goal all along has been... to give these folks, and I asked for this in the past, tools to control their own budgets. You've got to give them some flexibility."
Walker said that time and time again, collective bargaining issues "stood in the way of local governments and school districts being able to balance their budget."

Earlier Friday, Marty Beil, head of the Wisconsin State Employees Union, said his group would be willing to give in to Walker's demand for concessions on their benefits if the governor gave in on his bid to repeal nearly all bargaining rights for public worker unions

 The money involved is $360M out of a $4B budget shortfall. Most Americans already contribute double the 12.5% toward health insurance and 5.6% toward pensions that the union employees will wind up paying if Gov. Walker is . Ronald Reagan busted the Air Traffic Controllers union. Gov. Walkers point is a good one to the unions and it is simply that the fiscal problems being faced by the state are bigger than your bargaining agreement. Get over it. The world has changed. Is anyone really surprised that in ultra progressive Madison Wisconsin there would be protests in the streets? How many classes at University of Wisconsin got walks yesterday so they could support the proletariat? A bunch in the College Of Liberal Arts I imagine. I wonder how many of those kids will be able to find a job upon graduation in Wisconsin if they get what they want now.

Yet President Obama and the DNC support the unions. Unions are their constituents you see. They really could give a rats ass about the vast majority of Americans who are actually in the majority that elected a Republican majority in Wisconsin to do exactly what Gov Walker and the Republican legislator's have proposed. But ramming through ObamaCare using reconciliation was the right thing to do according to President Obama, Nancy Pelosi, Harry Reid and all the other progressive nutjobs. They want to use the fiscal crisis to advance cap and trade and immigration reform so they will have a constituency that represents roughly 55% of the US population that will pay no income taxes and be ever so loyal to their democratic masters. John Boehner sounds much more like an adult on the Wisconsin issue;

“I’m disappointed that instead of providing similar leadership from the White House, the president has chosen to attack leaders such as Gov. Walker, who are listening to the people and confronting problems that have been neglected for years at the expense of jobs and economic growth,” Boehner said in a statement. “I urge the president to order the DNC to suspend these tactics.”

Every single state in the U.S. faces similar budget shortfalls and the fight is spreading to Ohio, Michigan, Minnesota and other 2012 Battleground states. Jesse Jackson has even entered the fray. Given the fiscal problems our nation faces at the National, State and local level, the war in Afghanistan, The Middle East imploding why on earth would President Obama fixate on Wisconsin? Because he is a statist and the  Wisconsin crisis has revealed his true character as did his reactions to Egypt's revolution.

I am immensely proud of my children. They work hard at school and are focused on their Academics. When they were younger and they asked for items that were unaffordable I would consistently reply with my own question: What would Mick Jagger say? Invariably they would groan "You can't always get what you want". Hopefully Wisconsin will get what it needs as will other states. 2012 is going to be a brutal viscious election and if progressives continue to vilify good men doing what they were elected to do the map of america will be far redder than today. Progressives still have not figured out that not only do the federal & states not have any money neither do the ordinary people who are being taxxed to death.

Friday, February 18, 2011

The Tipping Point

America is at a crossroads. Yesterdays events in Madison Wisconsin made headlines as teachers unions protested a plan by Wisconsin's governor to eliminate collective bargaining for teachers for employee benefits and to contribute 12.5% toward the cost of their health insurance and 5.6% toward the cost of thier pensions. Minority Democrats fled the state to prevent a vote.In New Jersey Republican Governor Chris Christie has come under fire from public sector unions for his attempts to  raise the retirement age, eliminate the cost-of-living adjustment, increasing employee pension contributions, and rolling back a 9% pay increase.

At a time when his budget is DOA on capitol hill President Obama even opined on the Wisconsin situation as an assault on unions which incidently places his view of the situation in Wisconsin as completely in line with the NY Times Editorial page. The thing is both governor Christie and Walker are speaking the truth when they state the obvious fact that their states simply do not have the funds. Governor Christie said it well;

“Here’s the deal: I understand you’re angry, and I understand you’re frustrated, and I understand you feel deceived and betrayed.” And, he said, they were right: “For 20 years, governors have come into this room and lied to you, promised you benefits that they had no way of paying for, making promises they knew they couldn’t keep, and just hoping that they wouldn’t be the man or women left holding the bag. I understand why you feel angry and betrayed and deceived by those people. Here’s what I don’t understand. Why are you booing the first guy who came in here and told you the truth?”

So call this an intervention from an adult who fully understands the consequences for our nation if we continue to act like Greece and expect China to pay for our binge. The New York Times Editorial Board, many unions and certainly many cowardly politicians in both parties remind me of the crowd at at a Robert Earl Keen Concert. Thank God  some Governors are starting to act like designated drivers.

Friday, February 11, 2011

Coming to Newstand Near You

Have you Heard Our Government is planning a comic book to explain Health Care Reform to its citizens.

A new comic book to explain President Obama's health-care reform is coming! It's being written by Jonathan Gruber, the MIT economist behind many of the reform's concepts!
We're talking in exclamation points because we hope the comic book borrows from the over-exclamation of such hallowed comics as Rex Morgan, MD and Mary Worth!
OK, the new venture may not go that far, says a Pulse report in the Boston Herald, but the idea of a 2,400-page document being reduced to splashy-colored panels with captions ought to amuse -- no matter on which side of the aisle you sit.
Gruber promises lots of pictures and text. That's because it's a graphic novel, a long-form comic book. But that doesn't mean it's a novel-novel, as in fiction. Gruber says he'll be using facts to tell the tale.
It already has a catchy title: Health Care Reform: What It Is, Why It's Necessary, How It Works

Pretty sure (NSFW Satire in following links)  Robot Chicken may have some fun with this during Adult Swim but I digress. Psst here is my favorite comic about the constitution.

Thursday, February 10, 2011

Live From The Cook County Jail

Truth is somehow stranger than fiction. Hat tip to Jim McGovern who shared an excellent piece on FMLA from a very well done blog. It seems that one in five Cook County Sheriff's Office Employees and one in four Cook County Jail Employees miss work each day for an FMLA Event. Cook County Illinois includes Chicago Illinois hometown of our president and where former Obama Chief Of Staff Rahm Emanuel is running for Mayor. The thrill is definitely gone may appear in a campaign commercial in 2012 you heard it here first.