Math Fail

So.....Obama's Man on the Mic Gibbs says that if the healthcare bill is passed it will reduce premiums by "3000%"

Huh?

Consider this from American Thinker:
"Monday in Strongsville, Ohio, President Obama said that ObamaCare will reduce health insurance premiums by "3,000 percent." Considering that a 50 percent decrease in premiums would mean that we'd be paying half as much as we now pay for health insurance and that a 100 percent decrease in premiums would mean that we'd be paying nothing for health insurance, President Obama is telling us that insurance companies will actually start paying us money to keep our health insurance.

If your current health insurance policy costs $5,000 a year, insurance companies will pay you $145,000 a year (2,900 percent multiplied by $5,000). If you're fortunate enough to be paying $25,000 a year for health insurance, insurance companies will pay you $725,000 a year. There's no word whether you can purchase a more expensive health insurance policy to increase the amount of money that insurers pay you each year..."

Wow. So now the insurance companies will be paying me, and paying me handsomely, to have health insurance. How exactly does that work? Do these people have a freaking clue what they are talking about or did Obama go "off prompter" again? I shudder at thinking people who have such a loose grasp on basic math are fiddling with such a huge segment of our economy. I don't think they know the implications of what is in this bill and I don't think they care.

An Economics Lesson

There are many people who see taxing the Bad Old Corporations as a good thing. What with their overpaid CEO's and their profits, surely they are cash cows ripe for slaughter, right? But hold on there...do you know how pricing occurs? Read and learn
1. A corporation is NOT ALIVE. This is important to remember because although the economic health of a corporation is measured in dollars, it cannot live or die as a human would.
2. This means that when additional penalties such as taxes, fees, government sanctions are placed on a corporation on upon a product it makes, the penalty doesn't stay within the corporation. Instead it is rolled into the final cost to the cosumer. And yes, that includes PROFIT.
3. Profits are what the corporation makes AFTER COSTS. Costs include things like raw materials to make products, energy used to make and transport products, manpower to make products, locations to make products and all the ancillary fees, insurances and liability costs. So after they make the product, package the product, ship the product-whatever is left over is profit. Now some people see profit as evil. But profit is the fuel that allows corporations to grow. Whether is building a new factory, riasing employees compensation or creating more jobs, profit is the factor that allows that to happen. When government takes profit away through taxation or over regulation, it slows down or stops the creation of more jobs, more wealth and a more stable economy.
4. Local and state governments run off of tax revenues. Taxes are collected on sales, on production and on land. If corporations do not make a profit, the tax revenues go down. If the corporations close, then the local entities lose a taxable property and the resulting revenue. In addition, if fewer products are sold, then the local governments make less. That shortfall is what we are seeing now in Dallas. Socialists would insist that the federal government keep all programs in place by making up the difference. But at some point that cannot be sustained. And slowing down corporations is what puts a wrench in the system.
5. When corporation go out of business, aside from job losses, there is also a loss of choice to the consumer. Part of the reason people oppose Walmart moving into an area is because other grocery stores move out. Lack of choice means lack of competition. Lack of competition means higher costs to consumers. If you are the only ice cream source in town, you can charge more than if there are two others in place. This is why it is not necessarily cheaper to live a bucolic life in the country. Without the competition, costs stay high.
6. Over regulation of any industry makes it unresponsive to the market. We have seen this over and over and frankly, the government control of GM is troubling because no government program comes without countless rules in place. If those rules all worked toward the simple principles of making good products at a fair price, there would be no problem. But when politicians get involved, they put pet project in place. This is what happened with American companies. The foreign companies didn't have the same culture of gratitude created by the UAW and the Congressional leadership. So they could make adjustments to allow a good car to be built for a good price. That's not to say that Americans can't build a good car-I have 16 year old Venture so I know that isn't true-it's just that interference by government costs more down the line and doesn't provide an efficient solution.
I hope that clears up some confusion and that when you listen to the bills being offered that you consider that bigger isn't always better and that people in Washington really don't care that much about people in Tupelo, Richardson or Tucumcari.

Who Is Making Money On High Fuel Costs?

It would seem that Hillary Clinton let the cat out of the bag by trying to get Congress to pass a fuel tax holiday. While the margin of profit that oil companies make has been pretty consistent at around 8%. Granted that's better than some companies, but much less than say, Google, which had a 25% profit. To quote from CNN-which is not usually an apologist for big oil companies-

"...Even though many oil companies are reporting record profits, many people forget just how expensive it is for energy companies to engage in the oil business.

The average net profit margin for the S&P Energy sector, according to figures from Thomson Baseline, is 9.7%. The average for the S&P 500 is 8.5%. So yes, energy companies are more profitable than many others...but not by an inordinate amount.

Google, for example, reported a net profit margin of 25% in its most recent quarter. Should we have an online advertising windfall profit tax?..."

CNN Money April 29, 2008

So exactly which entities have the most to lose if gas taxes are cut? Not the oil companies, their taxes are paid before it hits the pump. But local taxing umbrellas such as counties, states and even the federal government have a great deal to lose if such a tax holiday were passed. The Obama camp is trying to rally union opposition by citing the possibility of losing construction jobs. But then again, is this real shrinkage of the domestic job market, or will it give construction companies the incentive to stop hiring people who are not here legally? And when it comes to tax dollars going into Washington D.C. , Texans are only getting about seventy five cents or so for every dollar we send. So where's the rest of the money? We could go into the scenario from "It's a Wonderful Life" where the function of the savings and loan is explained, but the simply matter is that the money Texans don't get back in the form of projects is political payola for things like ethanol support subsidies, pet projects and celebrity endorsed programs which due to their cost only help the already wealthy. In short, while there's a noticeable reluctance to address the issue, the federal government, state governments and local towns and cities are reaping a bountiful harvest of sales taxes that become exponentially higher when they are based on per dollar sales. Everyone wins, except the consumer. Maybe someone should read them the story about the Goose that Laid the Golden Egg before all of our gooses are cooked.

Letter To My Governor

The University of Texas has one of the most lucrative resources of funding in the United States. It's the largest university in numbers and one of the better known state schools. Having the large numbers of students in the Austin location as well as across the state, the average person has to wonder why the University of Texas Board of Regents continues to raise tuition. The answer is: Because they can. Until other parents, citizens and taxpayers demand transparency and accountability in the budgeting system, state schools will continue to nickel and dime the average student to the poorhouse all the while funding athletic programs that only serve a small microcosm of the university student population. And this doesn't even start to consider the many and varied fees imposed on a per hour basis for services and amenities that many students never use. BTW for a little perspective, Mack Brown, UT's football coach, will be paid $2.6 MILLION this year. I am sure all those kids working two or three jobs to try and take 12 hours per semester will appreciate that when they can't even see a game because alums get all the good seats at Memorial Stadium and besides, they have to work that day any how. Anyway, here's part of the letter I wrote to Rick Perry. He probably won't read it. I doubt anyone in Austin reads much of what is sent to them. They can't be if this stuff just keeps going on the way it is.

Sir:
This time has come to rein in the state universities in terms of tuition increases. While it is easy to for the schools to assume that students and families can just take out further loans, this is not always the case. Many students, such as my own children, work to pay their own way. When tuition increases, on top of penalties for retaking classes-which is sometimes required for the major in music, dance and theater-or for taking longer than four years to graduate, it places students in a difficult position. Students who work have to work more hours in order to pay higher tuition. That means there are less hours available to be in class which in turn means that the student is penalized for taking too long to graduate. Everywhere students turn, there's yet another surcharge or fee. And where is the transparency on the use of those fees? Many students are charged for services they never use. Why should a student who has no interest in athletics have to pay based on a per credit hour basis to support those programs? And by the way, this really seems ironic since the UT Board of Regents hired a football coach for a very hefty salary. So what are the priorities of these schools? It surely doesn't seem to be educating the average kid, but instead it seems to be to build farm programs for the NFL and NBA. Oh, and you will see a copy of this posted on my blog.

Another Global Warming "OOPSIE" Moment

So we have all these celebrity types who want to latch on and bask in the reflected glow of Al Gore under the dubious guise of "stopping Global Warming." Never mind that that particular moniker has recently been changed to "Global Change" which syncs nicely with someone's presidential campaign rhetoric, just pretend to go along. Well now it seems that some fairly heavy hitters who have spent more than a summer studying the weather, global currents and such are questioning the rush to judgment on the part of the Nobel committee and the Usual Suspects. Read the letter linked to the title above and the blog at Orange Punch and then ask yourself as the prices on gas rise and the demands of the liberal left further restrict domestic exploration and production if it's worth it to your family to keep throwing good money on bad science?
Bad Science

"Me-ism"-Why the Liberals Could Cause our Downfall

I think I will trademark the phrase. It refers to the modern phenomenon where many people think they are what my Mom used to call "the Bellybutton of the Universe." By that I mean, there are folks who think every condition of their waking and sleeping should meet their specific criteria of "good" even when that criteria is totally insane. I blame it to a certain extent on computers. It used to be that you logged on and the window looked the same every day. But then there came a time where people could change their window. They could personalize it-and so began the slippery slope. Now we can change our computer desktops, our cell phones even our charge cards to reflect the "real me". Is this a good thing or is this navel gazing taken to the extreme? I see this a great deal in schools. We get notes from countless students who all seem to have life threatening kidney conditions that require unlimited access to the bathroom. I am not making light of kidney conditions, but the number of kids with these types of access to hallways and out of the classroom are on the rise. What happened to self-control, or-horrors-going in the more than ample time between classes? There are similar issues with grades. First of all, deadlines mean nothing. If Johnny has a club soccer practice and tuba lessons, then we shouldn't expect him to do his homework-or so the conventional wisdom goes. And heaven help you if a student fails a class because it is never ever EVER their fault. It goes beyond the classroom. My kids work in a fast food restaurant. Grown people cannot give rational orders. And they quite frequently change their minds between the order and reception of the food. The result is the expectation that their every whim, no matter how outrageous or demanding, will be granted. My daughter quit her job recently after an event where a mother decided to pitch a fit because the fire laws forbade candles in the restaurant for her daughter's party. After bitching out my 22 year old and making two other servers cry, I have to wonder what this woman was trying to prove to her kids? Was she trying to prove that being a self-centered bully is the way to make it through life? I am thinking that is the case because we are raising a generation of children who have never been permitted to learn via experience. They are wrapped in virtual cotton, with parents hovering around them like putti surrounding a Renaissance creche. On a global scale we have things like Leo Dicaprio telling us how bad we are for not allowing Gore's message of obedience to the Kyoto Accord. While I think we should always seek more efficient and less destructive forms of industry, it would seem that in signing the accord, we would be the only ones in that position. Then there is the question of animal rights. Like it or not PETA, your unwillingness to allow domestic drilling for oil in ANWR has as much to do with this war we are in as anything else. It's easy to say "oh let's just not drive" but that is not reality. Heck, gas is over $3.00 a gallon and I still see folks sitting in the parking lots after school waiting for their kids with their engines running. And by the way, if we did all magically stop eating meat tomorrow, what would happen to cows, chickens and pigs? Are they so endearing that PETA members would willingly take a cow or two home to their Soho loft? Would Paris Hilton turn over her backyard to homeless chickens? Would Al Gore advocate pigs as a means of environmentally safe transportation? And by the way, the ethanol from corn that was crammed down our throats by Congress-it LOWERS fuel efficiency, it damages older cars and it forces the cost of corn-the main ingredient of livestock feed through the roof. And WHAT the hell did you expect to accomplish? Frankly, I don't know how anyone can look at one thing pushed through by liberals and still claim that they are a viable force. Oh sure, one might get elected, but mark my words, with a goofball Speaker of the House and an ultra liberal President, you will see riots, protests and possibly the biggest overturn of a Congress in history at the midterms. What will you do then?