Patterico's Pontifications

8/8/2009

Shaking a Wobbly Economy

Filed under: Economics,Government,Obama — DRJ @ 4:35 pm



[Guest post by DRJ]

There was a time when Democratic leaders criticized Presidents for record unemployment and deficits, but that was with a Republican President. Now Democratic leaders aren’t complaining when Democrat Barack Obama presides over record deficits and thinks losing “only” 247,000 jobs in July 2009 is a positive sign that the recession may have turned the corner.

Obama also thinks this is a good time for health care reform that expands coverage to all Americans, and he claims health insurance reform is vital to long-term economic recovery:

“We’ve begun to put the brakes on this recession and … the worst may be behind us,” Obama said in his weekly radio and Internet address Saturday. He cited Friday’s Labor Department report that showed a dip in unemployment, but said, “We must do more than rescue our economy from this immediate crisis. We must rebuild it stronger than before.”

He added: “We must lay a new foundation for future growth and prosperity, and a key pillar of a new foundation is health insurance reform.”

This is an interesting change in terminology. Has Obama deliberately changed his focus from health care reform to health insurance reform? If so, it may be because people generally like their health care providers more than they like their insurance companies.

So is this a good time for universal health care/insurance reform? I don’t see how. As Mike K points out, even the French system may be on shaky ground and the last thing a wobbly economy needs is more shaking.

— DRJ

15 Responses to “Shaking a Wobbly Economy”

  1. As we “Turn the Corner” in this recession don’t forget to examine the raw data.

    Obama cooked the books on the July unemployment numbers. http://hotair.com/archives/2009/08/07/unemployment-eases-to-94/

    The Lying POS that the mainstream media shoved down the throats of America will never tell any truth that doesn’t advance his position, Which is very few of them.

    Between the IG-gate Obstruction of Justice and the corruption of pay for play with his Acorn and Union accomplices it’s time to start the Articles of Impeachment.

    MaaddMaaxx (a9973b)

  2. Good point about the July numbers, MaaddMaaxx. Thanks for linking that.

    DRJ (8d138b)

  3. I saw that comment about the job figures a couple of days ago and haven’t heard it mentioned in all the MSM accounts. One reason may be that a lot of people are now convinced the bottom has been passed. I hope so. I listen to one investment guy on weekends, named Charles Payne, and he is saying the market is a buy right now but he doesn’t know about after September.

    Great ! That’s reassuring.

    One aspect of health care I did not really get into in my analysis of France is the fact that their legal system is very different. Judges in France also act as prosecutors. I shouldn’t have to mention that on a legal blog but it may be factor. It may affect the malpractice litigation situation.

    California has had a good med-mal reform in place now since 1975. Non-economic damages are capped at $250,000 and it has stood up to many attacks over the years. I have done a lot of med-mal consulting and have spent many years as an expert for the state medical board, as well. I don’t think the burden of med-mal litigation is as heavy in California but managed care really began here and is a different problem.

    I think the key to reform is to get away from pre-paid care. Anthony Daniels has an amusing but also serious piece today on the difference between care of animals in Britain and the NHS. His conclusion ?

    I hope I shall not be accused of undue asperity towards human nature when I suggest that the comparative efficiency and pleasantness of services for dogs by comparison with those for humans has something, indeed a great deal, to do with the exchange of money. This is not to say that it is only the commercial aspect of veterinary practice that makes it satisfactory: most vets genuinely like dogs at least as much as most doctors like people, and moreover they have a pride in professional standards that is independent of any monetary gain they might secure by maintaining them. But the fact that the money they receive might go elsewhere if they fail to satisfy surely gives a fillip to their resolve to satisfy.

    And I mean no disrespect to the proper function of government when I say that government control, especially when highly centralized, can sap the will even of highly motivated people to do their best. No one, therefore, would seriously expect the condition of dogs in Britain to improve if the government took over veterinary care, and laid down what treatment dogs could and could not receive.

    I still believe that surrendering the basic decision process to a bureaucracy is not the way to better health care. I have no objection to a system in which the payer uses evidence based guidelines to decide what to pay for. I do object when the patient and the doctor cannot arrive at a private contract that involves free choice among consenting adults. That is the present situation with Medicare and that is why I do not trust Obama.

    Mike K (2cf494)

  4. […] reasons over at Patterico’s where they examine the ever changing parameters for success dependant upon the D or R after your […]

    Gazzer’s Gabfest » More reasons to string “em up…as if you needed any more. (b98ad6)

  5. During the week I read volumes of financially related articles. Once you get past the usual fare of inflation vs. deflation and how long until this bear bounce ends, I am seeing an increasing number of writers expounding upon which countries rate the most favorable in terms of banking autonomy, tax treatment of expats, political and social stability, and a plethora of issues which revolve around getting your wealth and yourselves the hell out of the US while you can. Perhaps we could call them early adapters.

    Or you may call them wise, cowards, fools, or whatever you wish, it matters not to them. But do bear in mind that these are the same people who have been creating wealth over the last few decades, largely by paying the freight, taking the risks, and also prospering from the govt and central bankers’ financial largesse in such matters as favorable tax treatment and foreign inflows of capital. However, now it appears they believe those days are done for the time being, disappearing rapidly into wealth-sapping social re-engineering backed by insane levels of unpayable public debt. Thus the ‘smart’ money is looking to go where it is treated better. Which in this historical transition of power from West to East is not all that easy to discern since chaos rules and roils the markets.

    Now these are the cream of the moneyed just below the public eye, not the Buffets and Gates, the rich but not the powerful. No, these are those who need to find some new political friends wherever they can. Meaning some will be staying right here running all the new games being fabricated in DC and Wall Street, but a growing number [from what I’m reading] are afraid of what they perceive is coming and want no part of it.

    On a related note, this last quarter insider sales versus insider buying was at an extreme. I’ll let you guess which way it went…

    political agnostic (37d023)

  6. One thing that I haven’t seen much mention of is the coming “commercial property” dump. That in turn is going to precipitate an heretofore unseen vacancy rate in commercial spaces. Lease holders are not going to be receptive to negotiating downward on lease rates and lessees are not going to be able to pay the continuing freight.

    Most commercial mortgages are 3-5 year balloons with 15-20 year amortizations and a big chunk of those are coming up for renewal. I am seeing a glut of those properties on the market now at sale rates of around $37.00 per square foot – and these are quality properties, combined office and warehouse. I had a property on the market for almost two years and finally took a deep discount price.

    Look for the beginning of the bottoming when you see “short sale” commercial properties on the market. My barometer for market recovery is going to be when commercial property – especially lease rates – start to rise.

    I fear that is a long while coming.

    rls (e58293)

  7. Teh One cannot rebuild the economy until it is torn all the way apart. We are close.

    JD (0fd3fc)

  8. “pillar of a new foundation”? Foundations are not built on pillars — pillars are placed on foundations to support structure. He would have been better of just saying “foundation”, but, as a result of his usual grandiloquent manner, he places “z” before “a”. I wonder if any of these types of lines can be found in nightmares of my father.

    John B. (b4ecdf)

  9. Patterico and everyone, thought you would enjoy/appreciate/find interesting the following thoughts on healthcare from what I consider to be an actual “quality” liberal blog:

    http://riverdaughter.wordpress.com/2009/08/08/do-the-republicans-love-their-children-too/

    Yes, it’s an argument for single-payer, and I absolutely understand the opposition to that as I have trouble with it too… but IMHO the author is 100% correct when he/she writes about how Democrats unfairly caricature and demonize conservatives, even to the detriment of their ultimate goals.

    qdpsteve (5eb540)

  10. Steve, the “corporatist” fixation of the left has no more contact with reality than their fixation on global warming. I have a personal corporation. Does that mean I’m trying to subvert the nation ? What they don’t understand is that the people who have a quiet, not secret but quiet, agenda are the people who plan to make money on government. Andy Stern is one. There are lots of them; some, like T Boone Pickens, are out in public making their plans open and clear. Most are not so frank. The poor lefties think the folks who keep frustrating their collectivist plans are corporations. In fact, it’s ordinary people who know that money doesn’t grow on trees. you have to work and make it.

    Mike K (2cf494)

  11. DRJ,

    I believe calling it health “insurance” reform is simply a focus-grouped branding technique. Obama hasn’t changed what he wants to do. He has merely changed how he describes it.

    Patterico (d60743)

  12. I think you’re right that this is a polling-based shift in terminology, not policy-based.

    DRJ (8d138b)

  13. I think a fall-back position that they could be working on right now is “insurance reform.” What this might do is to force, by regulation, health insurers to take all comers with pre-existing conditions and to do away with experience rating to go back to community rating.

    This would be OK with a mandate to make young people buy insurance and especially if they could do away with brain dead state mandates. However, I doubt that is what it is.

    The Democrats are now busy demonizing insurance companies (even Cokie Roberts this morning) and they may have a plan to punish them for opposition if the public option fails. That punishment would be to regulate away their ability to do experience rating and to force them to take all comers at the same price. If they do that, insurance companies will start pulling out of health insurance, especially the individual policies, and the consumer will be pressured to seek a government option.

    The reason why you can’t have health insurance without some ability to deal with pre-existing conditions is that people will have no incentive to buy insurance until they get sick. That is a plan to bankrupt health insurance. We saw something like this early in the AIDS epidemic when there was a flurry of gays buying high dollar life insurance policies when they suspected they had contracted AIDS.

    If that kind of “insurance reform” is in the final bill it will be retribution against the insurance industry.

    Mike K (2cf494)

  14. That makes sense, too, Mike K. If Obama and the Democrats can’t get the health care reforms they want now, I think they will work to implement long-term policies that will result in nationalized health care. It’s not unlike the Democratic education reforms in the 1960s and 1970s that took 40 years to bear fruit but, IMO, got us to where we are today.

    DRJ (8d138b)

  15. Dr. K: thanks for your response, and just a quick note to say, I’m of two minds on the subject. Dennis Prager himself has said often, “both big government and big business suck,” and I pretty much agree.

    OTOH, I don’t believe much in great grand conspiracy theories about government or business either. Of course the “corporatist” memes are tiresome. Still, it’s just nice to meet some online lefties who appear to have a real interest– not just a claimed one– in actually engaging Republicans about health care, and are willing to call out their own side’s thuggish tactics. (If you want to meet lefties who claim to want conservative input, then scream down anyone who dares try, just check out Marc Cooper’s site these days.)

    Of course Mike, you wouldn’t be the first to accuse me of being hopelessly naive. šŸ˜‰

    qdpsteve (5eb540)


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