Saturday, March 31, 2012

Ideas to Reduce Medical Costs

Here's a brainstorm of ideas to reduce medical costs, one of our country's worse problems.  From my professional experience, the way to solve a complex problem is to take steps, one at a time, to fix what is known to be wrong or inappropriate.  Eventually the problem is solved with many baby steps.  Here goes:
  • Tort reform to reduce "defensive" medicine which means the practice of  medicine so that it can survive courtroom cross-examination and outside audit.  The idea is to reduce the cost of excessive tests and procedures.
  • Prices are too high because everyone in the medical industry;  doctors, hospitals and patients feel that they are using other people's money.  Therefore, expand and promote medical savings plans so that people and businesses buy high deductible "disaster" insurance at much lower premiums.  In this way when a medical cost comes, the consumer pays, questions the bill, seeks lower price quotes, etc.   The consumer in this way pays more of his/her own money and "has skin in the game."   
  • Increase the supply of both doctors and nurses--increased supply means lower prices (salaries) everytime!   
  • Break the monopoly of doctor's from the AMA--allow more doctors to practice.  Bring in foreign doctors--allow immigration of medical doctors and nurses.
  • Vastly expand physician's assistants to reduce cost.
  • Allow pharmacists to prescribe most drugs--they are highly qualified to do so.  This is the way it is in countries with low cost medicine.  No need to go to the doctor for most medicines.  Break the doctor's monopoly!  You yourself generally know what you need especially with a little help from a pharmacist.
  • Adopt world-wide drug price bidding to include low cost suppliers from Thailand, India and elsewhere.  Break the monopoly of the major US drug manufacturers!  May the lowest cost provider prevail!
  • Allow insurance policies across state lines for increased competition by insurance companies.  May the lowest cost provider prevail!
  • Insurance policies across state lines are then "portable."  A policy in Texas should be available in Idaho (and maybe at lower cost).
  • Use email and internet to communicate with doctors and allow doctors to send prescriptions to pharmacists (where required).  New types of Medical clinics could hold online chat (chat, video chat or Skype video calls) with medical professionals and clients rather than "old fashioned" office visits.  Doctor's can compete with each other in offering this sort of online service.  Patients can pay a small "visitation" fee with a credit or debit card (online).   Doctor's from India could participate!  Now that would be different!  
  • Online doctor clinics could be a good answer for low cost medicine.
  • There should be incentives for good health practices.   This means discounts for people with excellent health practices, ie., low insurance rates for people with perfect weight and exercise programs.  Interviews should inquire about diet, drinking, smoking, exercise habits.  Conversely, there should be penalties for fat and sedentary lifestyles.  This would be difficult to accomplish, but nobody has ever asked me how many times per week that I exercise.  I think it's relevant.
  • Cost effective performance by doctors and hospitals must be encouraged by insurance companies.   

Friday, March 30, 2012

Bad Weeks For The Obama (Mal)administration

We have a government that is not governing at a time that we need good governance and competent administration at the national level.

Energy Ignorance and Incompetence
The President doesn't know anything about energy and is apparently determined not to learn anything.  He continues to clamor for pie-in-the-sky, certainly marginal, energy sources when the oil and gas business has suddenly made the USA the "Saudi Arabia" of natural gas in the past few years.  

The US consumes 9 million barrels of oil per day for automobile fuel.   We import 11 million barrels of oil per day.   If we converted automobiles to compressed natural gas (CNG) and bought in 2 million barrels per day of Canadian oil, we would completely eliminate other oil imports.  All that is required is some coordination from the Federal government to 1) get automakers to make natural gas engine cars (conversion kits are available now), 2) have oil/gas companies to put CNG refueling stations in place, and 3) approve Keystone Pipeline.   It's not that complicated.  The US has an extensive natural gas transmission infrastructure and is ready for just this scenario.

But NO!  The President will have none of it!   He has a chance to be a hero, but he's a proven zero.  All we get from Obama is antipathy toward anything hydrocarbon.  There is no leadership anywhere!

ObamaCare in the cross-hairs 
This week the Supreme Court gave ObamaCare a firm "shellacking" in oral arguments.  The justices were, at times, sarcastic and contemptuous of the law's provisions and the rationale of the administration's lawyer.  A few made jokes at how the law was excessively long and complicated.  It sure sounds like they are going to strike it down.   So, what we have is a President, who was a Constitutional Law "professor," whose sole big contribution of his first and only term is likely unconstitutional!   How rich!  Not only is he not qualified to be a constitutional law professor, but he's completely out-of-his-league as President.

Another Obama Budget Voted Down 
The US has not had a budget for 3 years now.  I believe that if you can't budget, then you can't govern!    In May 2011, Obama's pie-in-the-sky national budget was voted down 97 to 0 in the Senate.  Now, this week, the President's most recent budget was voted down 414 to 0 in the House.   Is this President serious?   Unfortunately it's politics, incompetence and possibly malfeasance!   If you can't lead, leave!

Now Obama Wants Unconstitutional Powers to seize assets and detain people indefinitely  
There are already 3 lawsuits against the Obama Maladministration in front of the Supreme Court.  Do we have to add another?  Apparently so.  

On New Year’s Day, Obama signed the National Defense Authorization Act (NDAA) to fund the Pentagon. But smuggled into its language is an explicit authority “allowing him to indefinitely detain [US] citizens” according to Jonathan Turley writing in the U.K. Guardian newspaper.
At first, Obama “insisted that he signed the bill simply to keep funding for the troops.” But, Turley reports, “that spin ended after sponsor Senator Carl Levin (D-MI) disclosed that it was the White House that insisted that there be no exception for [US] citizens in the indefinite detention provision.”
Then on Friday, March 16, the President signed an order entitled “National Defense Resources Preparedness” gives the president the power “to take control of all civil energy supplies, including oil and natural gas, control and restrict all civil transportation,” according to Black. It also even allows a draft “in order to achieve both the military and non-military demands of the country.”
The far reaching order authorizes the president “in the event of a potential threat to the security of the United States, to take actions necessary to ensure the availability of adequate resources and production capability, including services and critical technology, for national defense requirements.”
Likely the president already has most of the enumerated powers as part of his role as commander in chief. So, why the order right now? Could the rise in gas prices constitute such an “emergency?” Is the issuance of this order right now a shot across the bow of oil companies to get them to go easy on oil prices? Where are we? Stalinist Russia?
In any case, these two presidential signatures – one on a law and the other on an order – together constitute a massive power grab totally unsuited to a democracy. The idea that he would be preparing to assume dictatorial powers seems so remote that the mainstream media has not even reported on these initiatives. But they should give all of us pause.

The President Is Unable to Learn Anything.

He never got the message of his "shellacking" in the mid-term elections.  He was on the wrong side of the argument of the police incident at the Harvard professor's house in Cambridge Mass.  He is wrong on energy.  He is wrong on Health Care. (Congress should have have focused on cost control efforts)  He is wrong about his emphasis on government as Central Planner and job creation.  Someone so incapable of learning could not have attended Harvard without vast "affirmative action" exceptions being made--either that or some kind of hardening of the brain has occurred.  He's as bad as Bush.

Vote this incompetent President out of office.

Wednesday, March 28, 2012

Tax Receipts as the Ultimate Economic Indicator

According to Sprott Asset Management the US Federal tax receipts are down in February 2012 vs 2011.  Tax reciepts are the ultimate co-incident economic indicator.  

This means that few people are working or being paid less in aggregate.  The latest "improvement" in reported job creation last month was primarily part-time workers and low paying workers.   The US employment situation is not really improving. 
It has become fairly evident over the past several months that most new jobs created in the US tend to be low-paying, while the jobs lost are generally higher-paying. This seems to be confirmed by the monthly US Treasury Tax Receipts, which are lower so far this year despite the seeming improvement in unemployment. Take February 2012, for example, where the Treasury reported $103.4 billion in tax receipts, versus $110.6 billion in February 2011. BLS had unemployment running at 9% in February 2011, versus 8.3% in February 2012.12 Barring some major tax break we've missed, the only way these numbers balance out is if the new jobs created produce less income to tax, because they're lower paying, OR, if the unemployment numbers are wrong. The bulls won't dwell on these details, but they cannot be ignored.

Figures from the Tax Policy Center show the history of receipts and revenues all of the way back to 1940.

The interesting thing is that, for 50 years, government revenues have been about 19% of GDP despite widely varying tax bracket rates.   The 19% figure therefore shows the EFFECTIVE federal tax rate.  This means that government revenue had been fairly constant despite top tax brackets varying from 33% to 70%.

For much of the last 50 years, government spending ranged from 19% to 21% of GDP during the 1990s and 2000s.   In Bush's last term (2008), Federal outlays were 20.7% of GDP.

Fast forward to 2010, only one year after Obama entered office, Government spending was nearly 24% of GDP (and tax receipts down to 14.9%).   The president's latest budget of 25% of GDP spending  ($3.6 Trillion) was sounded rejected by the House of Representatives by a vote of 414 to 0.

Monday, March 26, 2012

Obama pulling a Chavez?

The federal government is now expanding it's reach and intervention at an asymptotic rate as federal spending is spiraling out of control.   Are you aware that the Federal deficit in February 2012 was $200 billion??   That used to be the annual deficit only a few years ago.

Now, I'm hearing that a vaguely-worded law called the "National Defense Resources Prepardness Order" was signed on Friday that would give the government a legal basis for seizing resources in times of  "emergency".  Take a look at this link:  Sean Hyman of Moneynews,

On Friday (23rd March '12), when most people were already thinking about their plans for St. Patrick’s Day, Obama signed a new executive order which expands his power and control over all of the resources in the U.S. in times of war or emergency. 
This was convenient timing on his part, being that Israel just got approval to go to war with Iran when their military feels it’s the right time.
So if Israel strikes Iran, all Obama has to do is join in on it and he can seize any “real assets” in the U.S. he’d like. In fact, it doesn’t even take war. Any “emergency” is good enough too. And what determines an “emergency”? 
Anything that he deems an emergency. 
Sounds like Hugo Chavez to me. This is just another sign of rapidly escalating Federal power grabs with no end in sight.  I don't know about you, but I'm preparing to get out of this country before we become a completely totalitarian state.  Wake up America, it's happening before our very eyes!  If Obama is re-elected than that will be the sign to depart.  He can't be trusted for an unfettered 2nd term.

It is up to you to stop this insane movement toward infinite national government power. Vote against Obama and vote for Mitt Romney.  I prefer Ron Paul as the only candidate who has the radical agenda required for our times.  Ron Paul is the very nemesis of big and expanding government.

Furthermore, don't expect the Supreme Court to halt this trajectory in it's ruling on Obamacare with it's vast  new bureaucracy and the new taxes that are coming to pay for it.

Thursday, March 1, 2012

There is No Energy Plan in America

We consume 20 millions barrels of oil per day but we produce only 5.4 million bpd. The rest is imported and amounts to $500 billion in trade deficits each year--year after year.   The US used to produce about 10 million bpd.   

Obama and other Democrats have said repeatedly that you can't drill your way out this problem.   How does he know?    He doesn't know!!   Who could have predicted the burst of shale oil and gas production?  Natural gas production has risen so much that wellhead prices have collapsed to less than $3 per 1000 cubic feet.   (If it were priced the same as oil, it should cost $18 per 1000 cubic feet.)    Oil production in North Dakota is exploding and the Keystone pipeline would have helped to exploit it.  The problem with Democrats is that they are so pessimistic, Malthusian and arrogant!  Republicans are not much better----but still better in understanding energy.

No one knows how much oil and gas lies in offshore water along the ENTIRE US east coast and the ENTIRE US West coast.   We know giant oilfields exist offshore California (several were developed in the early 1990s containing more than a billion barrels each).   We don't know how much oil is in ANWR---no one knows!   We should know what's there:  maybe it's a bonanza, maybe it's not much.

Here's the history of US oil production:

Here's an energy plan for America:
  1. Allow exploration in ANWR (a flat mosquito-infested swamp in NE Alaska that no one visits or could visit even if they wanted to) that will definitely boost North Slope production.  How much is there; no one knows.  If it's the same as other parts of the North Slope, then you might expect 2 million barrels per day.  Don't tell me you can't drill your way out of a problem!   Politics, misinformation and Malthusian pessimism are the enemy.  
  2. Allow exploration and production offshore Southern California.  It's a known place of giant oil fields.  The last two fields developed there had more than 1 BILLION barrels of oil each. There are many more. Assume an extra 1 million barrels per day from exploration and production in Southern California waters alone.
  3. Convert trucks to natural gas (of which we have a long term surplus).  That would save 2 million barrels per day.
  4. Convert cars to methanol or compressed natural gas (methanol is made from natural gas). That would save 4 to 6 million barrels per day.   Automobiles consume 9.4 million barrels per day, so the import savings could be 9.4 million barrels per day total if all cars were converted to electric, compressed natural gas, LPG or methanol/ethanol.  The additional electricity could come from nuclear or wind power if you want to reduce carbon dioxide emissions.   Other ideas to reduce petroleum consumption would include expanded natural gas powered buses for mass transit or compressed natural gas fleet vehicles.
  5. Shale oil might provide an additional 1 million barrels per day or much more across the vast shale basins.
  6. Canadian oil sands are good for 2 million barrels per day.  Let the Canadians send oil to America via the Keystone Pipeline for refining in America!  
  7. The entire East Coast and the entire West Coast of the US are off-limits for oil or gas energy exploration.  No one, NO ONE knows what's there (or not).  There's no reason not to!  Only politics, ignorance and a complete failure to understand the consequence of chronic trade deficits and compromised national security by politicians are ruining this country.
There you have it. The above steps, without any credit for most of the offshore east and west coasts, could mean a gain of 4 million barrels of day of oil production, then a saving of 6 to 8 million barrel per day by using domestic natural gas for a reduction of 10 to 12 million bpd in oil imports.

 Let me repeat: the above steps could reduce our imports from 14 million barrels per day to 2 to 4 million barrels per day!   (not counting importing 2 million bpd from Canada).   If all cars were converted away from gasoline to natural gas or it's derivatives, then imports would disappear!   That's 0 million barrels per day of imports!

Now that's an energy policy!  If America can put a man on the moon in 10 years, then we could do this!   The only thing missing is leadership and faith in America like John F. Kennedy.   Obama has neither faith nor leadership.