Market-Ticker commenter Zappafan makes an astute observation:
Karl I doubt there is a good way to prove it but I suspect a lot of that increased spending on social benefits is Medicaid spending. The blogger over at usdailydeficit dot com has noted Medicaid is running +14% YOY through the first 3 months of 2014.
This is undoubtedly due to Obamacare funneling a lot of folks into Medicaid. That's going to a**-ream the deficit moving forward.
Also, there is very little difference between the effects of shuttling more people onto Medicaid and subsidizing the premiums of people who sign up on the exchanges.
My guess is that out of our 7 or 8 million sign-ups, many will be like an acquaintance of mine. He is a forty-something farmer who has some health problems and runs a small herd of beef cows. He has paid for his insurance for twenty-five years until his plan was cancelled last year. He was forced into the exchanges. When he enrolled, because of his low annual income, tax-wise, he found that his premium was fully subsidized -- not something he wanted or expected, but that's how it is.
With the high unemployment and under-employment rate of Americans under 35, the touted percentages of enrollments most likely means that fewer are actually paying than are being subsidized. That money has to come from somewhere. Every month. Subsidized plans add to an already unsustainable deficit. How exactly is this going to help "save" a collapsing Medicare program? How is it supposed to reduce deficit spending?
A bit OT...
ReplyDeleteWhen he enrolled, because of his low annual income, tax-wise, he found that his premium was fully subsidized -- not something he wanted or expected, but that's how it is.
Now that's a worthy goal. To be poor in the eyes of the Government. I can't remember where I read or heard this. It had to do with French sheep dairy farmers in Normandy. They live in lovely little stone houses on beautiful farms and hand milk their sheep in their little stone barns for little money. On paper they are poor, but as I read, they owe nothing and, in my opinion, live quite well.
Revenue minus expenses sometimes don't leave a lot of taxable profits -- especially if you have a good calculator.
ReplyDeleteMore to your point, Dad used to tell about a family that lived nearby. They had 80 acres, usually kept a milk cow or two, had a decent orchard, and a big garden like everybody else. Not a lot of revenue, but they raised their kids and got by just fine.