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McCain on taxes, cont’d
October 29, 2008
I’ve had a lot of emails about my piece on McCain’s failure to sell his main tax proposal–the refundable credit for health insurance. The article explained how the credit would leave most middle-income Americans paying less tax than under Obama’s plans. As it happens, taken together, I prefer Obama’s tax and health-care proposals to McCain’s: I think McCain’s health credit is good as far as it goes, but it does not go nearly far enough. Obama’s plan would expand coverage much more, and it seems to me that this should be a key goal. However, the fact remains that McCain’s plan would put more disposable income (net of taxes and health-care outlays) in the pockets of most middle-income voters.
Well, you would not guess this from the way the McCain campaign has dealt with the issue. Joe the Plumber and the preoccupation with Obama’s thinking on redistribution has clouded what surely ought to have been the main thing, from a tactical point of view. Anyway, as many have pointed out, we are all redistributionists in principle. Republicans too believe in spreading the wealth around. Is McCain planning to abolish the earned-income tax credit? Is he proposing a flat-rate income tax with no exemptions? It is a question of how far, not whether.
Many of the emails I received began, “You are just wrong,” and came from accounting firms, lawyers, and academics of one sort or another. I was initially disconcerted. What had I missed, I wondered? But no, it turns out, my correspondents had simply misunderstood McCain’s proposal in one way or another–and I don’t blame them for having done so. He is offering a refundable tax credit, not an ordinary credit (which can only be set against taxes owed) and not a deduction in taxable income (which would provide a much smaller tax saving); this credit would also be paid to people with employer-provided health insurance, not just to people who buy their own; and the existing payroll-tax exemption for health insurance would continue under the McCain plan (if this were abolished too, his plan would cut disposable income rather than increase it for many households). These were the most popular reasons for believing I was mistaken, and for maintaining that the Obama proposals would give middle-income households a bigger overall tax cut. Even sophisticated voters have failed to get the message: McCain is offering middle-income American a bigger tax cut than Obama.
Am I naive to suppose that this would have been a stronger selling-point than Joe the Plumber? Wouldn’t it have been a good idea to make sure this was understood?
“Republicans too believe in spreading the wealth around”. They certainly do, and they have done a great job of it. Just ask the Wall Street, Big Oil and defense industry CEO’s, the K Street lobbyists and the other fat cat Republican campaign contributors.
Posted by: algasema | October 29th, 2008 at 4:51 pm | Report this comment“Am I naive to suppose that this would have been a stronger selling-point than Joe the Plumber?”
The last gasp of the McCain campaign is to paint Senator Obama as a “redistributor of wealth”. Just the latest in the sequence of ridiculous “themes” that the McCain campaign has used.
It doesn’t matter, as with any other issue emanating from the McCain campaign, that there is not truth or relevance to anything of substance regarding “Joe the Plumber”. He is only a straw man that the McCain is exploiting. The “Joe” in question benefits more under the Obama tax plan in any realistic scenario than under the McCain plan.
The tax aspect of the health care credit whether refundable or not is irrelevant. McCain’s proposal on healthcare with or without the credit is pure, unadulterated nonsense.
It is also irrelevant to taxation since it is simply a substitute form of financing some portion of medical services costs that partially replaces some current form of financing. Terrible policy. Reprehensible policy if viewed against much better alternatives.
Posted by: Wendell Murray | October 29th, 2008 at 5:59 pm | Report this commentI would still like to know what is meant by “most middle-income voters” as it’s quite a vague term.
It seems to mean his plan will make more than 50% of the middle-income band - based around the median income - have more disposable income.
But will their health cover also be as good or better than under the Obama plan - ie. what is meant by “better off”?
And how wide is the income band on either side of the median that is being considered here - ie. who counts as “middle-income”?
Posted by: Dave | October 30th, 2008 at 10:54 am | Report this commentIsn’t it possible that healthcare costs will rise to reach the funds available for healthcare under a centralized system?
I think that is a basic part of McCain’s plan is that the individual will decide how much to spend on his own health care (to an extent) rather than a centralized authority.
In Sen. Obama’s Chicago we have the centralized John Stroger Cook County Hospital, so scorned that John Stroger himself refused to go there in his 2006 illness. Shouldn’t we all have the opportunity to NOT go to Cook County Hospital?
JBP
Posted by: John Powers | October 30th, 2008 at 1:21 pm | Report this commentJBP: Please, before your make the to-be-expected comments along these lines:
“that the individual will decide how much to spend on his own health care (to an extent) rather than a centralized authority.”
please do some research. There is a vast and in many cases outstanding literature out there regarding health policy and the economics of supply and demand for medical services.
Read the book Mr. Cook recommended a while back by Dr. Ezekiel Emanuel (a fellow Chicagoan by the way) called Healthcare: Guaranteed. I differ with Dr. Emanuel in regard to financing of medical services - there really is no superior alternative to a single payer/insurer fund to replace the current funding system, although Dr. Emanuel’s (and his earlier collaborator’s, Prof. Victor Fuchs’) proposal of a voucher system is very good.
As opposed to the “best of all possible worlds” the current healthcare system in the USA is the “worst of all possible worlds”.
I know nothing about the hospital you cite, but urban county hospitals almost exclusively treat the indigent, have continual problems with financing and often provide poor quality care due to understaffing or poor staffing. They are one of the consequences, not a cause, of the current system.
On the other hand - a fact that I am sure you will appreciate and perhaps know - many urban county hospitals have the best trauma care units in any hospitals anywhere. Three guesses as to why. Guess where Governor Corzine of NJ was taken when he almost died in a car crash a few years back?
Posted by: Wendell Murray | October 30th, 2008 at 1:56 pm | Report this commentSays it all, doesn’t it? Noone LISTENS to what John McCain ACTUALLY proposes. People want (what, yet AGAIN???) a Messiah, read Gore Vidal and Kurt Vonnegut, God Bless you Mr. Obama, etc.. Makes me sick, sad and convinced the world is doomed to self-inflicted punishment and, eventually, extinction by idiocy.THANK YOU, Mr. Crook, for your thorough, fair, reasearched, thoughtful, balanced reporting. It is worth its weight in gold. You can leave the fiver to Mr. Rachman, it won’t enrich him.
Posted by: elizabeth schumann | October 30th, 2008 at 2:08 pm | Report this commentelizabeth schumann: “Noone LISTENS to what John McCain ACTUALLY proposes”
I do and I do not like what I see. I suspect that many of Senator McCain’s supporters have very little clue what he proposes if one takes the “Joe the Plumber” nonsense as an example. The reality of “Joe” is the exact opposite of the straw man that the McCain campaign has created of him.
To tell the truth there is a lot in Senator Obama’s proposals that I do not like for that matter, but at least I have made an effort to know where he stands versus Senator McCain on most issues.
Posted by: Wendell Murray | October 30th, 2008 at 2:14 pm | Report this commentWM,
Centralized/Socialized provision of goods does not work in most industries (food, for example) why should we assume that it would work in healthcare?
The fact is that the Obama campaign is heavily invested in centralized planning of healthcare, with Sen. Obama’s sponsor Tony Rezko going to jail, along with Stuart Levine and Jacob Kiferbaum, being central figures in rigging health care construction in Illinois.
The choice is pretty clear, do you want Obama/Rezko/Levine/Kiferbaum making your healthcare decisions for you, or can you make better ones without them?
JBP
Posted by: John Powers | October 30th, 2008 at 3:13 pm | Report this commentJohn Powers,
Because centralised/socialised provision of healthcare DOES work in the UK’s NHS.
The administrative overhead is less than for alternative, insurance-based schemes or private care.
If standards in some NHS hospitals are below standards in some US ones, this is chiefly because the UK spends much less per person on healthcare than the US.
The chief problem with the NHS is not usually the allocation of resources, it is making increased resources politically acceptable. Rhetoric favouring market-based alternatives has tended to make this task more difficult.
Posted by: Dave | October 30th, 2008 at 3:21 pm | Report this commentDave,
Is it Rhetoric, or in Practice that market based methods tend to work?
There certainly are thousands of ways that cost efficiency could be improved in US healthcare, but I do not see that happening when the system is rigged so badly as it is today by swindlers such as the Rezko/Levine/Kiferbaum syndicate.
JBP
Posted by: John Powers | October 30th, 2008 at 3:37 pm | Report this commentJBP: “Obama campaign is heavily invested in centralized planning of healthcare,”
Reread his policy proposal on healthcare, anything but.
So-called consumer-oriented healthcare has relevance, but only to a very small portion (e.g. 5%) of the demand/supply for medical services. The remaining 95% is all administratively determined by the nature of the market itself that has never and likely will never operate as a classic competitive market.
Some relatively remote chance of that happening when all clinical records digitized and all provider entities are connected to the Internet, then patients could possibly competitively bid on available time of provider services and have adequate immediately available necessary information to create a true competitive market, but who knows regarding that.
Posted by: Wendell Murray | October 30th, 2008 at 3:55 pm | Report this commentWM,
Tell that to Tony Rezko.
The reason that healthcare is off the market in much of the United States is that it is illegal to open competitive healthcare businesses in states like Illinois. Introducing lower cost drugs is reason for the FDA to reject a new pharmaceutical.
It is not that people and corporations are incapable of competition in healthcare, rather it is not allowed by our central planning authorities.
JBP
Posted by: John Powers | October 30th, 2008 at 4:06 pm | Report this commentAs a contracting and temporary worker who has no employer paid insurance, along with millions of other Americans who have no employer-paid insurance, I’m looking at which health coverage plan might actually make it through Congress and be of benefit in my lifetime.
We have waited many years for some kind of help and I just don’t believe that Obama’s plan (in whatever variation he is presenting) has a chance of being adopted. Senator Clinton was very clear that health insurance was a top priority. Obama was tepid to start and learned the talk about this issue from his education gained by running against her. I just don’t believe it is a high priority for him, no matter how eloquently he describes his support for it at this point.
So, I’m trying to look at what might be possible, not a pie-in-the-sky plan that I doubt will ever make it through the lobbyists to become any benefit to those of us for whom coverage means something different than it does for people who have coverage.
Actually, I have started thinking that health coverage may need to be done from the states up instead of waiting for the government to decide on a plan that will benefit all the states.
Posted by: annetta | October 30th, 2008 at 4:10 pm | Report this commentBy the way, wasn’t Michelle Obama implementing the George Bush program of moving urgent services out of big centralized hospitals to neighborhood clinics? It sort of worked in getting health services closer to the patients, but of course the media will ignore anything that could possibly show favorably on President Bush, even if it also is favorable to Michelle Obama.
It would be a different election if the media actually went to the South Side of Chicago and reported on actual conditions there.
JBP
Posted by: John Powers | October 30th, 2008 at 4:10 pm | Report this commentannetta: “the states up instead of waiting for the government”
State governors concluded this a while back in their various Governors’ Conferences, ergo attempts by Massachusetts, Vermont, California, etc. to do something on their own.
Unfortunately this is a case where something has to be done for the country as a whole, exactly the same as national defense. Implementation of say a single payer/insurer scheme can be and probably should be handled jointly by the federal governement and the States, but the basic coverage, funding, etc. has to be nation-wide. The fragmentation of insurance/funding is by the far the worst single aspect of the current USA system.
We will see something approximating single payer/insurer in the next Congress and Administration if the polls on the various elections are accurate and if the Democrats show some courage, but who knows. There are already several bills not acted upon in both Houses of Congress that would work with some changes.
Posted by: Wendell Murray | October 30th, 2008 at 4:20 pm | Report this commentI want insurance on my clock radio just in case it ever breaks. I cannot afford to buy a new clock radio, so I might buy an extended warranty from the electronics shop, but I could not afford the extended warranty, so now I want the government to pay to guarantee that my clock radio works for a good long time.
What could be simpler?
JBP
Posted by: John Powers | October 30th, 2008 at 4:43 pm | Report this commentJBP: “What could be simpler?”
Single payer/insurer is just a single fund or set of related funds that puts everyone into the same risk pool under one community rating.
How the insurance works can be varied, i.e. the equivalent of a high-deductible plan could be incorporated, etc.
The point is that multi-private insurance funds and plans only add to costs - significantly, in fact - while reducing value rendered. As I wrote earlier, a true case of the “worst of all possible worlds” held together by decades of propaganda and campaign contributions to politicians of both major parties.
Posted by: Wendell Murray | October 30th, 2008 at 6:16 pm | Report this commentWendell,
How does that get the Feds to pay for the extended warranty for my clock radio? Surely if the Federal Government ran the extended warranty business it would have less overhead and be able to deliver more value for less money.
JBP
Posted by: John Powers | October 30th, 2008 at 7:50 pm | Report this commentIts not only the Taxes, it’s the ones that pay less or no taxes:
Senator McCain advisers links to the Investment Banking/Hedge Funds Community , lobby’st and Hedge-Fund partners like Berman,Kravis,Mehlman,Pritzker,Kramer,Furman, etal have been very bad news for him,and even when the same group is also in smaller part behind Senator Obama , Senator McCain could not shake-out the fact that these Hedge-Fund people still pay only 15% in taxes when everybody else in the USA pays 25 to 35 % in taxes and most operate from tax-free shelters like Cayman Islands, Bermuda,Gibraltar,Switzerland ,etc.:
People are outraged that : it took only a weekend to push a 700 billion dollar Banks/Investment Banks/Hedge-Funds “Bail-Out” with Tax Payers money and yet its taking weeks and weeks to pass a smaller 350 billion dollar “stimulus package” for States and Consumers ! , that mortgages still cannot be re-rated ? , that the infrastructure of the country is crumbling and still no Bail-Out ??? how can greedy incompetent bankers get help for their mistakes in a few days ,while the taxpayers that are going to pay for the Bail-Out still can’t get any help?
and Senator McCain with all these Hedge-Fund managers and lobby’st in his campaign just didn’t get it…that was and is a huge mistake…even now we learn that “so-called” outsider Gov.Palin was shmoozing and dining with all the ultra-DC insiders before being selected : Kristol,Barnes,etal at the Alaska Cruise stops, so it was a pose and a marketing tool…
But lets be realistic:
Will S.McCain or S.Obama really set the USA towards Energy Independence ? will they put the Federal Reserve inside the Treasury and stop letting them call overseas ahead of time to selected bankers and partners ? will they cut waste and corruption in Defense Contracting as far as needed ? will they cut taxes from most and raise taxes on Hedge-Funds? of course not….that’s just Campaign talk, as soon as they enter the White House, the same usual neocons will take over key positions and nothing of real importance will change, sad buy true and the Taxpayers will be taken one more time to the cleaners.
Posted by: financialtools1@gmail.com | October 30th, 2008 at 8:23 pm | Report this commentJBP: You are not making any sense.
“Normal” consumer products and services - if produced and distributed in a more or less competitive market - are priced to meet the intersection of aggregate demand and supply - no outside intervention needed.
Medical services are not a typical consumer service. An extended warranty on a clock radio is.
I hereby assign you to remedial microeconomics. Go down the street to the University of Chicago (or any evening class offered anywhere) and sign up for a beginner’s class.
Posted by: Wendell Murray | October 30th, 2008 at 9:01 pm | Report this commentMedical services are not typical consumer services because there are truckloads of laws preventing such things as operating health clinics inside Walgreens, or price competition in prescription drugs.
By and large, healthcare is pretty much like any other good, except that the government likes to meddle more, in the name of the public welfare. More meddling lets you control more health boards, more lobbyists to collect money from, and buy more votes.
JBP
Posted by: John Powers | October 30th, 2008 at 9:32 pm | Report this commentJBP: None of what your write is completely true.
Prescription medication is often patent-protected and competition comes from substitute medications that may or may not have the same efficacy and/or lower price.
Pharmaceutical companies are always trying to control price throw direct control or by trying to generate “excess” demand or by restricting supply.
Ample help on that from an earlier Congress that passed the Medical D law that allowed some control over price by diffusing the power of the main buyer (Medicare). Bad law that in any case. Needs revamping.
“preventing such things as operating health clinics inside Walgreens”
Nothing prevents that unless there are State laws that do for specious reasons. Most States, so far as I know, do not have such laws unless the State medical societies have overwhelming influence over the State legislature.
In any case whether walk-in clinics in Walgreens or Wal-Mart or another venue can survive is still an outstanding issue. They meet service in a market niche, but I do not know whether there is currently enough demand in that niche to sustain them economically.
Posted by: Wendell Murray | October 30th, 2008 at 10:01 pm | Report this commentI am hopeful that Mr. Crook will do another healthcare policy post (hint, hint).
I just watched the interview with Jeffrey Kindler, the CEO of Pfizer, on the FT website.
Either he is dishonest (unlikely) or he has no clue about healthcare policy issues (more likely).
He gave a worse than pathetic response to Ms. Freeland’s questions regarding policy. Frankly I am shocked at how poor his response is.
Posted by: Wendell Murray | October 30th, 2008 at 11:45 pm | Report this commentMost States do have laws against walk in clinics. They have to be adjunct operations to existing hospitals, rather than competitors to existing operations. No one in their right mind cares what you or I think Wendell about how a business can be “sustained economically”, but that isn’t what is stopping businessmen from opening clinics. It is the Rezko-ridden State laws. I am sure there is an equivalent of Tony Rezko in most of the other States squelching competition to benefit politicians.
You are also wrong on new drug approval. Undercutting competitors costs is a reason for FDA rejection, regardless of patents.
A good part of the system is screwed up because of anti-market forces, not because the market cannot work in healthcare.
Sen. Obama had quite a bit to do with the Illinois Healthcare Facilities Planning Board when he was in the State Senate…the same Rezko-packed board that keeps competitive health clinic out of Wal Mart, Walgreens etc. How bad do we want to take this regulatory model nationwide?
JBP
Posted by: John Powers | October 31st, 2008 at 2:11 am | Report this commentJBP: “They have to be adjunct operations to existing hospitals”
I frankly do not know the specifics on State laws, but MinuteClinic is present in the following states according to its website:
* Arizona
* California
* Connecticut
* Florida
* Georgia
* Illinois
* Indiana
* Kansas
* Maryland
* Massachusetts
* Michigan
* Minnesota
* Missouri
* Nevada
* New Jersey
* New York
* North Carolina
* Ohio
* Oklahoma
* Oregon
* Pennsylvania
* South Carolina
* Tennessee
* Texas
* Virginia
* Washington
The website further states the following below. This includes Illinois, so presumably the legislature prohibits them as stand-along clinics. Absurd, but this almost certainly reflects the power of the physicians’ cartels who do not want any competition. No other reason I can think of:
Health care services provided in the states of Connecticut, Illinois, Indiana, Kansas, Maryland, Michigan, Minnesota, Missouri, North Carolina, Nevada, New Jersey, New York, Ohio, Oklahoma, Tennessee, Texas, Virginia and Washington are provided by entities not owned or controlled by MinuteClinic, Inc.
“Undercutting competitors costs is a reason for FDA rejection, regardless of patents.”
This may well be true. Large pharmaceutical companies are favored by many federal government laws and regulations. I have very little knowledge of FDA operations, so I cannot comment.
“A good part of the system is screwed up because of anti-market forces”
This however is simply untrue, as I stated earlier. The demand and supply of medical services does not operate on a competitive market basis. There is no question about that. Potential that it could, as I mentioned above, but that is 10 years off at best, if it ever happens. Full adoption of computer information technology is needed. Excellent technology is available now and will continue to improve, but the resistance from physicians - for no good reason - is very strong.
Supply to physicians and other providers (hospitals) can and should be competitively determined. It is not for many products and services for any number of reasons including federal government regulations designed to protect the interests of suppliers as well as the normal dishonesty of politicians from both parties that protect both medical specialists and equipment suppliers. Many cases of that.
Much more can be written. Everyone else is bored by this to and fro anyway.
Posted by: Wendell Murray | October 31st, 2008 at 4:01 am | Report this commentFrom your voluntary editorialist
Egon B.E. Friberger, Brussels, Belgium
Oratorical disgrace. The collapse of Sen. Obama’s commitments market.
******************************************************************************
The Financial Times heralds the oratorical skills of Sen. Obama and the steady competence of his campaign. They are right. Heralding party diversity between Congress and Office establishes with even more accuracy the power of diversification along gender and legislative/executive experience. Two major dimensions exclusively offered by Sen. McCain.
All the more traumatic is the contrast with Sen. Obama’s inefficiency, the disgrace of his messages and his inaptitude to deliver. The contradiction between crowd grasping rhetorics and the observable or expected delivery is an invaluable danger.
Sen. McCain aspired, invented a steady way and achieved a similar poll-position with half or a third of his opponent’s funding, an excellent degree of efficiency. Up to the choice of Gov. Palin it is obviously his leadership. His adequacy in speech guarantees the inaptitude for cheating, thus truthfulness. The authenticity of his scrutinized “shambles” is no reason for discount. Sen. Obama’s horrifying methodological and psycho-pathological lack of any true emotion, not even on economic emergency, is. The record funding and the overly perfect marketing mechanics of his campaign, far from a sign of other than oratorical skill, do not command respect. They raise anxiety: “Who commands?”
Nomination speeches are accreditation letters to the American people and to the world. Actually, it is a resume of Sen. Obama and his campaign. The disgrace in his messages is a terrible blend of subliminal insults, subliminal insinuations of racism to rip off votes, non-stop whining about every aspect of society to demoralize the nation so he can pop up with change pep, and reanimating segregation based on age, gender, health condition and social class or wealth condition. Those unethical messages raise social tensions and lead to choking the individual sense of responsibility or risk taking, of the organic sources of prosperity and of the nation’s potential by downward leveling. Whereas Sen. Obama smeared in a perverted way every American uniform demonstrated Sen. McCain an outstanding sense for shades of gray: “I hate war. It is terrible beyond imagination.” He has seen shades of gray in most matters with his own eyes. No wonder, much to his credit, he bravely and consistently takes qualified pro-positions in any matter. He speaks not as smoothly but his nomination speech is a masterpiece of dignified rhetorics.
After the oratorical smoke, is there any fire for delivery? Many little pieces of evidence from Sen. Obama’s past and present, especially the huge anti-American Berlin-type support abroad, offer no priceless guarantee of the intention to deliver according to prospects. Any competence isolated from his campaign looks weak, with regard to the subject, as for instance proved by the economic nonsense on tripling oil import and on the relation between wealth and social work, as well as with regard to judgment of advisers’ input, as proved by the terrible blend in the nomination speech. What we have seen when he could command, not even the audacity of change to select a female running mate, so simple an act, so clear a signal, came out of his substance. Sen. Clinton left the nomination race with over 50 % of the vote and forged so an historic advance: the inevitable duty to select a feminine running mate. Not even that elementary sense of his own for society and all-American civil rights.
Mr Obama keeps cautiously and deliberately pondering his answers with his campaign commanders in order not to raise alarming insights. Calculated rashness is a virtue in a president faced with an acute challenge. If he deals as quickly and with as much accuracy as he dealt with the invitation of Miss Take Five Gov. Palin then the American people is in the right hands beyond imagination.
Miss Take Five is “widely acknowledged to have been a mistake”. Let us analyze this along two points.
1. Any choice less audacious would have left a huge space voraciously filled in with the idle but steady competence of his opponent’s campaign commanders.
2. Whose very nomination is a historic advance in US politics? When a black male were to lose an election, the entire society is racist. 6.8 % of the population. When a woman would lose an election, then it is “widely acknowledged to have been her own mistakes”, and the society a perfect democracy. 50 % of the population. The phrase is a resume of the entire cliché-systemic anti-female rhetoric that in any other context would be qualified as racial prejudice. The subliminal intellectual downgrading along secondary themes like abortion and unfounded insinuations that it were silly to vote along gender considerations complete the historic setback of a 50% majority.
Sen. Obama introduced racism insinuation in the campaign. White citizens can rightfully not vote for him, not because he is black but because he threatens them with accusations of racism. This is the man who threatens to put America on the world map as a racist state. Women can not vote for him because he disguised his anti-female ambitions with racism accusations. One woman were haphazard. Two women is a cliché systemic system. This man’s greasily steady communication mechanics, lavishly financed, are sentimentally well wrapped social and electoral injustice.
The challenges facing every past, present and future president are extraordinary. Sen. McCain has proven he can handle challenges with half or a third of the resources and he can handle them himself, changing his mind on the spot upon incoming new information from excellent advisers, and always in a dignified, heartbeat, chivalrous manner. He engineered a platform that directly connects with the entire society. The American people will exactly know who is in command, what his vision is and that his vision and vice-president are not perfect but truthful and better.
Posted by: Egon B.E. Friberger | October 31st, 2008 at 10:00 am | Report this comment“Mary”, “Jennifer” and now “Egon”. Who (or what) is next?
Posted by: algasema | October 31st, 2008 at 2:09 pm | Report this commentSure WM,
Healthcare is certainly boring, and the tedium of the details does not get you elected like making bold and wrong statements such as Sen. Obama has.
The Minute Clinics etc have to reach agreements with local hospitals depending on the level of care they provide. In Illinois if they get into anything more complicated than services typically provide by a Nurse Practitioner, there must be approval of the IHFPB (Rezko, Levine, Bill Cellini-indicted yesterday-, Kiferbaum etc), or more likely a partnership with a local hospital. Keeps the insider trading going strong.
McCain’s idea of consumer based healthcare holds up pretty well, though I don’t think he is providing a comprehensive reform for healthcare via his tax proposal.
JBP
Posted by: John Powers | October 31st, 2008 at 3:21 pm | Report this commentJBP: “McCain’s idea of consumer based healthcare holds up pretty well”
It doesn’t at all. Not his idea anyway, it is an idea that has been pushed by various people for years.
I agree with you that in medical services, just as in any other economic exchange, it is best to let competition work its magic when the conditions exist for competition to exist. The unavoidable fact of the matter is that medical services lack the necessary conditions for competition to work. Private insurance makes no sense whatsoever on top of that.
I believe the current wave of walk-in clinics are staffed only by nurse practitioners or perhaps, but depending upon State law (perhaps in all States) there has to be a physician “overseeing” the work in some way.
I have not seen either a pro-forma or actual income statement for any walk-in clinic or group of clinics, but my feeling is that the profitability of the clinic is likely sensitive to a consistent and even flow of patients - something that may not to obtainable. The potential services offered may be too narrow as well. It at least conceptually makes sense for Wal-Mart for example to have in-store clinics because a clinic can serve both Wal-Mart employees and Wal-Mart customers.
Posted by: Wendell Murray | October 31st, 2008 at 4:03 pm | Report this commentWM,
Do most businesses in the US require your approval before operation? Why do you need to see an income statement before it would be allowed? Can’t the Doctor/Clinic Provider make up his own mind as to profitability without big brother Wendell?
I volunteer at a free clinic on the South Side of Chicago, that is being driven out of business by a walk in clinic at Target. Even at a price of “free” customers are willing to go to a discount store for more consistent product and delivery.
I am glad it is being driven out of business, by the way.
JBP
Posted by: John Powers | October 31st, 2008 at 6:54 pm | Report this commentTaxes in future will probably be more focused on attaining several goals, i.e. will not only be a means of raising revenue to meet government expenditure, but also used to encourage people to change or adapt their behaviour.
Germany is about to launch a package (min €30B, max €60B, depending on agreement reached by the political parties) of measures to boost economic growth, which will include a lower car tax (perhaps even abolishing it) for cars which have lower CO2 emission levels. The German automakers want this measure introduced, as they are committed to producing a new generation of cars running on alternative energies.
Furthermore, small and medium-sized family-owned companies will probably be freed from inheritance tax (incl. tax on inherited property) when a business is handed down from one generation to the next. These KMUs (small and medium-sized firms) are the backbone of the German economy.
I see John McCain wants to reduce capital gains tax. There is no capital gains tax on profits from stock transations in Switzerland, no matter how long or how short the period one has held the stocks for. I cannot understand why the USA (which is so pro-capitalism), taxes the profits made from investing capital. Why indeed?
Posted by: J.J. | October 31st, 2008 at 7:22 pm | Report this commentJ.J. Labor is taxed at a given rate, why tax capital at a lower rate? Absolutely no reason to do differentiate for economic reasons. It is a gift to the wealthy. Income is income is income to be taxed consistently at the same rates.
JBP: My point is that I do not know whether these clinics make money or not. I doubt that they do, but I have no facts to back up my guess. That is why I mentioned an income statement.
“I volunteer at a free clinic on the South Side of Chicago”
Fantastic that you do that. Interesting that patients would prefer a walk-in clinic though.
Posted by: Wendell Murray | October 31st, 2008 at 9:52 pm | Report this commentWM. Yours of 31 Oct/9.52pm.
I take your point, but tax is a very complex topic, affected not only by economics but also by ethics. Mobility is just one aspect.
Labour is comparatively immobile: people accept income tax and remain immobile; they may seek a new place of residence/emigrate if income tax reaches a punitive level.
On the other hand, capital is very mobile, and a developed economy needs a lot of capital* .
That is probably one reason why Switzerland has no capital gains tax.
On the other hand I can understand why the socialist (SPD party politician) finance minister of Germany, Peer Steinbrück is in favour of taxing capital (and gets into a frenzy about Germans parking their capital abroad) because he is a SOCIALIST.
So for the USA (where capitalism is sacrosanct) to act like a SOCIALIST state and tax the gains resulting from the investment of capital is imo not only illogical but the wrong economic strategy.
Wall Street has done more damage to the US economy than Karl Marx could ever have dreamed possible. Now the USA desperately needs a massive amount of capital not only to replenish capital in the banking and insurance sectors, but also for upgrading industry and infrastructure. If it wants to attract capital from abroad, the USA may have to become a tax-haven
*The French economist Jean Peyrelevade expanded on this in his article “Regulate or fail” (Réguler ou faillir”) about the global finance sector “post-finance crisis” in the French business paper “Les Echos” on 24th October.
WM. After 4th November, there’s sure to be more blogs on US economic policy. I’m glad CC is leading on this.
Posted by: J.J. | November 1st, 2008 at 10:51 am | Report this commentHere’s one aspect of healthcare no one is addressing that the Obama and McCain plans differ on completely. McCains healthcare and tax plans work together to benefit the 3rd pillar of the economy, while Obama’s destroys it - with immediate U.S. and worldwide repercussions:
Posted by: BJB | November 1st, 2008 at 5:06 pm | Report this commentObama’s Tax Plan Destroys Non-Profits
The Non-Profit sector of the U.S. economy is the SIXTH LARGEST ECONOMY IN THE WORLD according to the World Fact Book. It is larger than the economies of Brazil, Russia, Canada, Mexico and South Korea COMBINED. It is almost entirely dependent upon: Corporate Giving, which will take a huge hit if Corporate Income Taxes are raised, Foundation and Individual Philanthropy, which will do likewise if the Dividend Tax is raised. Also, bequests to non-profits will suffer if the Inheritance Tax is reinstated. That’s BEFORE personal income taxes and Social Security taxes get raised as Obama has announced he will do both, reducing individual small gifts and payroll deduction gifts, and percentage of purchase gifts.
The healthcare providers, schools offering or discounted care and doing research, and charities that will be affected are not just in America, but ones that rescue animals, feed the hungry, teach the illiterate, provide healthcare, environmental cleanup, land mine cleanup, disease research, cleft palate surgery, WORLDWIDE.
Who will provide the millions for the next tsunami, earthquake, etc. relief around the world, a world that depends on America’s generosity?
I don’t think the folks jumping on the Obama economic bandwagon, who know what the international effects of the “affordable housing” fiasco have already been, realize the incredible worldwide suffering his economic and tax plan and healthcare plan will cause innocent people.
Meaning well, and doing well, are two very different things. Obama’s plan would have “unintended consequences” kind hearted humans cannot tolerate.