Obama's Most Recent "Assault on Business Owners"

There are a lot of wealthy, successful Americans who agree with me -- because they want to give something back. They know they didn’t -- look, if you’ve been successful, you didn’t get there on your own. You didn’t get there on your own. I’m always struck by people who think, well, it must be because I was just so smart. There are a lot of smart people out there. It must be because I worked harder than everybody else. Let me tell you something -- there are a whole bunch of hardworking people out there. 

If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business -- you didn’t build that. Somebody else made that happen. The Internet didn’t get invented on its own. Government research created the Internet so that all the companies could make money off the Internet.


-Excerpt from President Obama's speech on July 13, 2012


Many people on the right have already jumped all over this. But I thought I would put my two-sense in. Many conservatives are trying to paint this as an assault on business owners; an attack on the private sector. While without hearing the tone of the speech, or perhaps only reading a smaller chunk of this speech (many conservative outlets have used solely "If you’ve got a business -- you didn’t build that. Somebody else made that happen."), it may sound anti-business, but I believe it's more of an excuse for more government with pro-government sentiment. Other than that particular part of the speech being poorly worded, I believe Obama's overall message of the speech was that everyone uses the help of government at some point--whether it be through welfare, student loans, or merely using the roads paved by public employees, and that, in doing so, you did not build your business on your own. He uses this because of the brewing kettle of anti-government sentiment that is about to spill over out of the pot that is the Republican party. 


But who will pave the roads?


Anybody who has libertarian-leanings or has read the work of Murray Rothbard can surely appreciate the irony of the above question. This post is not about making a case for the privatization of our roads or highways, although that has been done many times, but the point really is--we don't need the benevolence of government to get things done. Contrary to what many of Obama's zombies may believe, the United States would not be some third-world country crawling with pollution and poverty, and no new innovation, even things as simple as roadways, without the help of government. I'm not in favor of total anarchy, I do believe law enforcement, fire departments, and things of that nature are best suited for the public sector. However, Obama is using rhetoric to help the members of his party believe that because the successful people could not get where they are today without government, more government is necessary. Two aspirin may help my headache, so therefore 25 aspirin will help my headache even more! 


The second part of this excerpt that really bothers me is what is said in the first paragraph. While I agree with him that there are a lot of hard working people out there--individuals who try to start a business (business owners often put in 65+ hours per week during start-up) and fail, single mothers with only a high school diploma who work three jobs to support their children, who don't succeed, to discredit the intelligence and drive of others who do is just wrong. It's almost as if, by his logic, if there is a group of 100 hard-working people, only a dozen or so will be successful, and that is because the success-fairy blessed them with successful dust and that's what creates success. As if it is total luck that smart or hard-working people become successful and it is government's job to bring down those who got lucky in order to help those who didn't. While "luck" is such a dangerous word to use, let me make it clear that I believe that to a certain extent, people create their own luck. They do so by surrounding themselves with the right people, making informed and well-timed decisions, and putting themselves in the right place. Yes, I agree with him that hard-work and intelligence does not guarantee success, but by making the right moves or doing the right things, or taking risks, success can be achieved. Yes, we've all had great teachers, great inspiration, and great role models to help us along the way. But is it fair that John Lennon give 10% of his profit to Dr. Hofmann for synthesizing LSD? 

Free Market vs. Universal Health Care

It's easy for most people to say "oh yeah universal coverage is great!" And by and large, when polled about current health care systems, Canadians, Brits, and the French tend to respond very positively about their own universal coverage systems. However what many do not take into account about these polls if that people will more likely respond in favor because people are in good health most of the time. Pair this with a "free" system of health care and why wouldn't most respond in a positive manner? However, what most people don't consider is the strict limitations put in place on both the medical professionals and the patients with a universal system. Not to mention the shortages/surpluses that go into effect when price controls are enacted.

We have all heard about the waiting times that come with a universal system. Often times for screenings, these waits can range from a couple months all the way up to eight or nine months. Want to pay out-of-pocket for a screening to get one sooner? Not an option under many universal systems, including the ACA, looks like you're stuck waiting for a screening that could be life-saving. Dr. Lee Kurisko, a radiologist who lived his whole life in Canada made the move to the United States some years ago, for a number of reasons. He cites the free-market as the best alternative to health care, and cites the numerous problems that occur within the Canadian health care system. Dr. Kurisko explains that in Canada, the government sets the prices, in place of the market. This causes shortages that wouldn't occur in a free-market.

 In Canada, when a doctor is paid, say, 20 dollars for a given service in downtown Toronto, and a doctor is getting the same thing in the remote community of Manitowage, the artificially set prices blunt the potential for movement of information. If there were a deficiency of doctors in Manitowage, and you allowed the marketplace to work, the prices would go up in Manitowage. The doctor in Manitowage might get to charge 50 dollars for a service that would be reimbursed in a free marketplace in Toronto for only 20 dollars. In such a scenario, doctors would start moving to Manitowage. Once there were more doctors in Manitowadge, the price would tend to correct back downward.

This market method of resource allocation would allow for more doctors to practice in remote areas, without long-term price increases. This opens up options for patients, allowing them to have greater and higher quality access to care without sacrificing higher prices. He goes on to state:

With Medicare, you get cost shifting. If, as a health care provider, you’re artificially reimbursed too low for some of your clientele, that means to cover your costs you jack up the prices for other clients. As those costs go up, you’re actually contributing to the number of the uninsured because insurance costs are artificially inflated, and fewer people can afford coverage.

However now, under the ACA, because everyone is insured, and physician reimbursement rates will no longer be set by the market, doctors will have to stop offering low-return services in order to continue to make money. This is just one more example of how government control leads to shortages, in this case, shortages of services.

The free-market approach is a consumer-driven approach. In any part of a free-market, a product or service provider must satisfy and meet the demands of the consumer in order to stay in business. These providers must compete against one another for service, and in doing so, drive down the fees they charge as well as improving the quality of their products, or else face bankruptcy. Health care should be no different, but it is treated differently due to government interference, malpractice insurance and doctors over-testing patients both due to the threat of litigation.

Another problem facing American health care is this use of insurance for every thing from a physical to a triple-bypass. While I believe the use of insurance for the latter is appropriate, the use of insurance for routine and expected services only drives up the cost of such procedures. As I mentioned in my former post "Why Free Market Medicine Works," using high-deductible health plans, in combination with health savings accounts for these run of the mill procedures allows the consumers to shop around for the best combination of low-cost/high quality doctor, which forces physicians to lower the cost of these procedures while simultaneously increasing quality in order to attract consumers.

HDHPs require that those covered pay higher deductibles (a minimum of $1,200/year or $2,300/year/family) but ultimately have lower premiums. These are required for a HSA and often times half of the covered's money goes into the HSA while the other half covers the insurance product. At the end of the year, the person likely had a few thousand dollars in the HSA and can use it on routine procedures, or choose to roll it over for the next year. By allowing individuals more control over their health-payments, it encourages them to take better care of themselves, and because HSA's are tax exempt and the money in them can be invested to collect interest, the money in one's HSA can grow.

As I've stated before, the problem is not that everyone must be covered by insurance, but that the cost of health care should be made more affordable. Many people do not realize that despite the name "Patient Protection and Affordable Care Act," the care is not made more affordable, nor are patients protected. Having a slip of paper that says you have insurance does not translate to actual health care. When doctors stop accepting medicaid and medicare patients, there will only be an increase in shortage of care. Not only that, but when government elects which procedures are appropriate in order to stay cost effective (such as the role of IPAB created under PPACA), not only are the patients options limited, but the option may not be appropriate for certain patients, and a physician doing what's best for that patient now becomes punishable by fine. Does that sounds like "patient protection" to you?

It's Now or Never, Privatize Social Security

It's undoubtedly one of the most sensitive issues in politics, whether it be in the national spotlight or casual conversation at the dinner table, the topic of social security is a soft-spot, particularly for the elderly or those who are soon looking to retire. It is a federal program that the once-hopeful GOP nominee Rick Perry called a ponzi scheme, where he was greeted with much criticism. But I couldn't agree more.

We've all heard that social security will be broke in the near future, but let's take a look at some real numbers that will bring the issue a little closer to home. When social security was first created in 1935, there were 40 workers for every one retiree. In 1950, that ratio drops to 16 workers for every one retiree, whereas today, the ratio is a dismal 3 workers for every one retiree. You don't need to be a statistician to understand that the trend is a decreasing worker:retiree ratio. Estimates indicate that the social security trust fund will be broke by 2037, and retirees will not be able to receive full benefits. If a federally funded (taxpayer funded) system were to work, there would need to be a combination of increased payroll tax rate, increased retirement age, and possibly decreased benefits. In the words of economist Dan Mitchell, keeping this system would be like "paying for a steak and receiving a cheeseburger." Senators Rand Paul (who I am quite fond of), Lindsey Graham, and Mike Lee created a proposal titled "Social Security Solvency and Sustainability Act," which attempts to accomplish the salvation of social security. I disagree with this because of one of the provisions of the act is to gradually raise the social security retirement age to 70. I believe it is more important to phase out the taxpayer funded ponzi scheme, and allow citizens to privately invest their own money to pay for themselves in the future, rather than supporting an irresponsible pay-as-you-go model.

Think privatization of social security is crazy? Almost 30 countries have at least in part privatized social security and the ones I have looked into have all seen great success, including Chile, Australia, and even socialist-favored Sweden. Chile, for instance, had privatization accomplished in the early 1980's by a man named José Piñera, who created a system that includes: no social security tax, no government-funded pensions, and ten percent of the worker's paycheck is automatically transferred into a personal savings account (PSA) that the government is not allowed to touch because it is the worker's money protected by property rights. These accounts are unable to be accessed until the worker turns 65. Not to mention workers in Chile have had a rate of return of nine percent above inflation. José Piñera said himself that when Chile adopted this system the Dow Jones was at 900, whereas today it sits at roughly 10,300. But even if the individual worker decides against the stock market due to higher volatility, he/she is more than welcome to diversify his/her portfolio and include more stable (although less potential for return) options such as bonds or treasury bills.

My suggestion? Allow younger workers to opt-out of social security and start paying into a PSA. I'll even go one step further than Chile and allow the workers to decide for him/herself what percentage of income he/she would like to donate to the PSA every year. This allows the workers to take their expenses into their own hands. After all, I am positive that the individuals know more about their financial future than do the bureaucrats in Washington, and a one-size fits all model is bound to face opposition from freedom-loving Americans. Eliminate the social security tax and public pensions (as Chile did), granting more liberty to Americans to do with their own money as they please. With an average higher rate of return, total solvency, and more financial freedom, why wouldn't you support privatization of social security?

More Taxes=More Revenue, Right?

Wrong. However those on the left, particularly President Obama often use rhetoric such as, "the rich need to pay their fair share," and continually cites the example of Warren Buffett as an individual who actually wants to be taxed more and believes the wealthy are not taxed enough. Mr. Obama even went as far to claim that Ronald Reagan himself was the originator of the "Buffett-Rule" and should so aptly be named the "Reagan-Rule." This is just an attempt to trick Americans into thinking that current conservatives are right-wing radicals, as if to say that not even Ronald Reagan, arguably the most cherished conservative of the 20th century, is too moderate for current-day republicans. Contrary to any left-wing hooplah, this is simply not true. Mr. Reagan wanted to make the tax code more fair by lowering taxes across the board, not by making the rich pay more. It started in 1981, when he cut the capital gains tax rate from 25 percent to 20 percent, and wanted to further reduce it to 17.5 percent in his 1985 proposal, but conservatives in congress agreed that the only way to lower the income tax rate, they would have to negotiate to raise the capital gains tax rate.


Onto the original question. Now, I think it's obvious (at least to those of us who can do simple math), that raising the taxes of millionaires does not justify for more government spending, nor can raising the taxes of the millionaires keep our runaway spending even close to afloat. That point aside, we can at least all agree that increasing taxes will increase revenue for our benevolent government, right? Wrong, wrong, wrong. The wealthy have worked hard for their money and know how to divert capital to other areas, including taking advantage of subsidies or using tax havens. General Electric for example took advantage of green-energy subsidies to hold on to shareholders and escape excessive taxation. Economist Dan Mitchell, a man I frequently cite states:

In 1980, when the top tax rate was 70 percent, rich people (those with incomes of more than $200,000) reported about $36 billion of income; the IRS collected about $19 billion of that amount. So what happened when President Ronald Reagan lowered the top tax rate to 28 percent by 1988? Did revenue fall proportionately, to about $8 billion?

Folks on the left thought that would happen, complaining that Reagan’s “tax cuts for the rich” would starve the government of revenue and give upper-income taxpayers a free ride. But if we look at the 1988 IRS data, rich people paid more than $99 billion to Uncle Sam. That is, because rich taxpayers were willing to earn and report much more income, the government collected five times as much revenue with a lower rate.

Yet some believe that we should punish businesses for taking capital and jobs overseas, and that leaving is un-American, but moving assets in a way that makes sense for the owner is a basic freedom that shall not be infringed. If the government wants to keep jobs and wealth here, a flat-tax rate with a simple tax-code, free of subsidies and deductions is the most effective way to do so. 

Why America Should Be More Like Sweden

America is like the kid who got straight As in elementary school, a brilliant mind who dedicated time to studies and academic excellence; then middle school hit. America started hanging out with the wrong crowd and started to change its views on life and by high school it went from top of its class to the middle. Sweden, on the other hand, who also did well in elementary school, had a middle school slump, but came back strong by the start of high school and is now headed in the right direction.

Unnecessarily drawn-out analogy aside, I do believe Sweden and the United States are heading in opposite directions. Before everyone jumps this gun on this one, we must recognize that sweden has enormous government spending (almost 50% of economic output according to Dan Mitchell), and a large tax-rate of 56.6 percent for the wealthiest Swedes. However, prior to their status as all-star of the welfare-world, Sweden had low tax-rates, limited government, deregulated industries, and free-market policies in other areas for much of the 20th century allowing them to grow to become a very prosperous nation (Sweden also avoided costly wars, such as World War II, allowing them to retain some spending). Then the downfall (middle school) occurred during the 1970s through 1980s when Sweden started to regulate and raise taxes to feed a public sector and welfare state that grew dramatically. In 1991 through 1993 Sweden suffered both a banking and real estate crash. However, sometime after this, Sweden grew wise, cutting the top marginal tax rate from almost 90 percent to just under 57 percent today, eliminating both the inheritance and death taxes, and a corporate tax rate reduced to 26.3 percent (compared to United States which boasts a 38 percent federal corporate tax rate, not to mention additional state taxes as well).  Sweden enjoys pro-market policies, such as a partially privatized social security system, and a nationwide school voucher program with for-profit schools.

Bottom line: The United States has lost its way in the world, and, although Sweden is by no means the poster-child for limited government and low tax rates, they are at least heading in the right direction, something that I cannot say about us.

The Myth of Underpaid Women Part II

Shortly after writing "The Myth of Underpaid Women," I was messaged by a friend who provided me with a link to "The Mommy Tax" by Ann Crittenden, which discusses the financial toll women take when deciding to have kids--losing out on hundreds of thousands (and in some cases millions) of dollars throughout their lifetime due to maternity leave. The immediate suggestion which came up was a government-sponsored maternity leave to help reduce the income disparity between genders.

I have a big problem with this. Anytime anything is "government sponsored," it actually means "taxpayer sponsored." Every time the taxpayer must step in to foot a bill it means less disposable income for the people. That being said, let's play a numbers game. In 2009, 72,019,000 women were in the civilian labor force, 66,208,000 of whom were employed (U.S. Department of Labor). So let's pretend that the number of employed women hasn't changed, and that it will stay constant forever. In that case, 66,208,000 women are employed and roughly 80% of women have children at some point in their lifetime. 80% of 66,208,000 comes out to 52,966,400 women who would have to be subsidized for having children at one point or another. Now, this can get messy because we then would have to analyze the average number of children that women would decide to have, but for sake of brevity, let's solely analyze the cost for having one child. If we assume paid maternity leave is 16 weeks (as it is in France), and there are 52 weeks in a year, where the average woman with a bachelor's degree age 25 and up is making roughly $40,000 per year, each woman is entitled roughy 12,300 dollars. Throughout a lifetime, the rough total cost for the taxpayers comes out to $6,518,941,538,000. While this is a very, very rough estimate, nonetheless I think it makes a point that it is not a cheap entitlement to run. 


The other suggestion would be a mandate that forces business owners in the private sector to pay for their female employees' maternity leave. This is another terrible idea, that would force businesses to cover more compliance costs, hindering ability to expand and hire more employees, generating more wealth. Since I like numbers so much, here's a little more food for thought. Let's say a small business owner employs 30 people, where 15 are female. Let's say that of these 15 women, 10 were hired straight out of college, and, sticking with the idea that ~80% of women have children, 8 of these women decide to have kids while employed for said business owner. If each is getting paid ~$30,000, using the same 16 week paid leave example as before, it will cost the business $73,845 for eight separate maternity leaves. What does this mean for the other 22 employees and employer? It means each having a shortened pay of $3,210 for these eight leaves. However, if the workers are unionized, I doubt that the union will stand around and take that, meaning the business owner would have to bare all of the costs him/herself. This may mean not taking home a paycheck for a few months, or this may mean limited expansion and investment for a few months, pushing back potential hirings. Not to mention, the women are not obligated to tell their employer that they are or plan to get pregnant. This makes the environment more unpredictable, especially when the owner doesn't know the costs that he/she will have to cover in the near future, and with the tens of thousands of pages of regulatory burden, not to mention compliance costs, taxes, and the constant threat of litigation, this would only add to an already hostile environment for business owners. 


This is not being sexist or chauvinist, I feel the same way about paid paternal leave (which is covered in France, no surprise there). Unfortunately those who are anti-business treat employees like helpless puppies and the business owner like the master of the pound, but in reality, a good employee is equally or more valuable than the pay they receive. Any time a woman needs to leave for maternity leave, especially a talented and skilled one, it already hurts the business enough. 

The Myth of Underpaid Women

There has been much talk lately of the Census Bureau date from 2008 that showed that a woman makes only about 77 cents to every male's dollar. So with this statistic in mind, of course bureaucrats in Washington are going to try to make new legislation to ensure equal pay under the law for both men and women (market be damned!). But, let us all not forget what happens when politicians see a statistic without really deciphering the meaning--they misconstrue the data.

Now, it is true that if you were to add up all of the incomes of all of the women in the U.S., then divide by the number of women in the labor force, then did the same for men, you would see that women makes only about 77% as much as men do. But is it because we still live in a sexist country, saturated with discrimination?

I don't think so. I encourage any of my readers to walk onto the campus of Rensselaer Polytechnic Institute (RPI), located in scenic Troy, NY, or any other engineering-focused school and count the number of women. Chances are, it won't be long until you realize that men outnumber the women roughly three to one (at RPI). Men are more likely to go into more lucrative fields such as engineering, computer science, business, or investment, whereas women are more likely to go into fields such as humanities or social work. Although there has been an increase in the number of women graduating with math or science degrees, the women that make up much of the labor force graduated in the 70s, 80s, and 90s--when math/science degrees weren't so popular among the ladies.

Another point that economist Steven Horowitz makes is that many women who graduated from college during the above mentioned decades were less likely to see themselves working a full-time job, and more likely saw themselves working for a period of time before taking time off to raise children, or perhaps taking a job that required only part-time work so that the family could also be looked after, which of course means a lower income.

This isn't to say that absolutely no gender discrimination takes place anywhere in this country anymore, but I believe that it occurs much less than those who like to legislate every little imbalance in our society would like to believe. The income disparity between men and women occurs more through the choices men and women make, including educational choices, the choice to have kids, and the choice to assume responsibility for work in the house. This is not something that can be legislated or mandated, but like I've always said, social changes occur through time or shifting attitudes of the population, not by some government enforced policy. As more and more women start to engage in science and math, perhaps more women will take up fields in engineering, investment, or medicine, which will naturally lower the income disparity. No law will be able to do that, ever.

Walker Wins Recall, Does It Matter?

Wisconsin Governor Scott Walker (R) has won the country's third ever gubernatorial recall election, defeating union-supported democratic challenger Milwaukee Mayor Tom Barrett. Interestingly, this was the first time in the United States' history that a recall has not resulted in the success of the challenger. This speaks a few things to me. The first calls me to question the legitimacy of the recall. Obviously the voters of Wisconsin did not think that Walker has done such a terrible job (with 94% of precincts reporting, Walker lead by a 9 point margin (54%-45%, I think it's worth noting that Walker only won by a 5 point margin in 2010), after all, according to the state Department of Revenue, the state should boast $275.1 million surplus by June 30 of this year and a $154.5 million surplus by June 30, 2013. The other way in which the aforementioned statistic speaks to me is that Wisconsin, like much of the country, is incredibly polarized. Clearly this margin of victory was no landslide; many have strong feelings in both directions on many issues, including the debate over the appropriateness of unionized labor and its power.

Both sides of the political spectrum have been speculating over the importance of this election--what does it mean for November? I've heard many say that this recall election could be a big momentum swing for November or at the very least will be indicative of how the country as a whole feels. We all knew whoever the loser was--the media outlet on his side would surely shrug it off, even if the same person claimed the election was significant prior to knowing the results. Well unfortunately, this recall was primarily about one issue, where the issues that shape the results in November are a melting pot of problems primarily consisting of the economy, gas prices, and unemployment. However, we must also keep in mind that Wisconsin is very much so a blue-collar state, with heavy union influence. It's not much to say that the Boston Celtics beat the Heat in game 5, however it would be noticeable if my high school team beat the Miami Heat. Okay, maybe Walker wasn't that big of an under dog, but the point being is that I think it shows the truth; number don't lie, and his policies (whether you agree with them or not), have helped Wisconsin with a debt problem, something that New York State could afford to take some notes on. However Romney, (to my knowledge) has made no plans to tackle public-sector unions like Walker has, his policies and the policies of Walker are not a perfect match, and in an election atmosphere where independent voters turn the tables, it is important to keep in mind that many independents vote on issues pertinent to their daily lives. My diagnosis: this recall victory for Walker has little impact on the presidential election in November.

Nanny of the Month Award Goes To: Mayor Bloomberg

Politicians love to pretend that they care about you, but in reality all they care about is re-election and special interests. This month's Nanny Award goes to Mayor Michael Bloomberg of New York City, who thinks that it's government's role to end the obesity epidemic in the United States. 


Mayor Bloomberg, who recently proposed a ban on soft drinks sold in containers larger than 16 ounces, appeared on MSNBC to discuss with Andrea Mitchell his ban, stating, "The idea here is, you tend to eat all the food in the container in front of you. If it’s a bigger container, you eat more. If somebody put it in a smaller glass or plate or bowl in front of you, you would eat less.” Bloomberg also made the point that this does not solve obesity, nor is this the sole root of the problem, but that, "We have an obligation to warn you when things are not good for your health.”


Similar to other nannies, Bloomberg believes that big brother government can solve all of the woes of the world; that individual people are too stupid, too naive, to make this kind of decision for themselves. His logic, to my understanding, is that if individuals want to drink more soda, then they must make the conscious effort to buy another can or bottle, because the ban places no restrictions on the individual to buy the soda, solely on the vendor to sell the size of container. 


There are already nutrition facts on every food product out there. Taking it to the next step, as if people cannot read it for themselves, Bloomberg wants to end the sale of large soft drinks. It is a slippery slope my friends, and it is only a matter of time until our old friend the sugar-tax on soda rears it's ugly head, or the government wants to implement calorie/sugar restrictions. You're too stupid to make healthy life choices for yourself. But hey! Now that every one has/will have health insurance this is a good thing! We can stop paying for everyone that needs a triple bypass because they've been too busy drinking soda daily. 


Unfortunately, we are moving in the wrong direction. More big government only yields more big government. Our government believes that the solutions to our problems are to tighten the collar on individuals, restricting freedom, and as more and more universal services are offered, this will only get worse. Politicians in office believe that in order to get things accomplished, they must put in place more rules and regulations, but to me, a good politician repeals and vetoes more often than proposes and passes. 

ADA's New Mandate

Everyone wants to help those who are less fortunate. This rings true whether it be the poor, the sick, or the disabled. However when government gets involved unintended consequences emerge, often more harmful and outweighing the good that was intended. Then what happens? Anybody who opposes these laws and regulations who are intended to help people (but in reality don't) are labeled as "selfish"or "heartless." This results in ineffective laws standing; it is my firm belief that politicians ought to spend more time looking into how laws and regulations play out, rather than how they sound. 

The Americans with Disabilities Act is a prime example of good-intended legislation that has had a multitude of negative consequences. A few weeks ago, the Obama Administration placed a 60-day extension on the mandate most recently placed under that law. The mandate? Every pool that is open to the public most install a lift for those in wheelchairs so that they can safely be placed in the pool. This sounds great, now all the "disabled" will be able to safely enter the pool. What monster would oppose such a concept?

I do. My primary grievance comes as soon as I see the word "mandate." Anytime the government has to dictate what a private business can or can't do, it will inhibit the business owner, otherwise, if it was good for the business, I'm sure the business in question would already be doing it. But let me clear the smoke by laying out what the legislation actually entails. The mandate says that all pools open to the public (public pools, private pools, hotel-owned pools, etc.) must install a lift for individuals bound to wheelchairs that lifts them out of their wheelchairs and places them into  the pool. The Obama Administration recognizes that these lifts can cost several thousands of dollars (the estimates I've seen range from 3000-5000 dollars), so they offer a 5,000 dollar tax-credit to any of the pool-owners willing to comply, and if architectural work or renovating needs to be done, then the business will be granted a 10,000 dollar tax credit per year. However problems emerge because of how vague the mandate is, it does not constitute what will count as an acceptable lift. This type of law-ambiguity can easily result in a lawsuit which will ultimately cost the business owner much more. In fact, critics of the mandate say that one reason this legislation was imposed is due to the affiliation of trial lawyers to the Obama campaign, the same group that contributed $45 million to his 2008 campaign. As a result, many hotel owners who fear that they will not be able to comply with the mandate are closing down their pools. Now everybody loses. 

Legislation like this is intended to help the "disabled," to level the playing field. But I fear this legislation doesn't really help the "disabled." For several years of my life growing up, I was a member of a private pool for public use, which is where I met Stacy (Stacy is not her real name). Stacy had suffered a stroke early in her twenties, resulting in partial-paralysis of the left side of her body. She walks with an unnatural gait and wears a brace on her left leg, and surely qualifies as one of the 36 million Americans considered to be disabled. However, she is a fantastic swimmer, and would surely beat me in a swimming race. Does that make me "disabled?" The term disabled itself is degrading, because while those who are called "disabled" may suffer physical complications, they may excel at something else. My mom's father was stricken with cataracts at age seven and was totally blind by the age of nine. He got by just fine with the love and support of my grandmother, and his trusty seeing eye dog. He didn't need government's pity. 

Government's laws intended for good do nothing more than make the less fortunate subordinated and dependent.  I have no problem if the pool-owner puts in a wheelchair lift due to the request of customers, but the government mandating such is wrong. Vague rules invite lawsuits, which, even if the pool-owner wins, the time and money spent in trial is surely no victory. 

Gun Popularity Rises; I Feel Safer

We all have that initial thought, "more guns means more violence." It's intuitive that more guns in our society means the higher chance that some wacko starts shootin' up the place. I mean imagine if everyone had a gun, our society would turn into the wild west, a place of lawlessness that hardly is associated with a safe public.

However, time and time again, it's been shown through research and polling that more guns in the hands of law-abiding citizens, means less crime. Perhaps the most conclusive study (and most frequently cited) was the one conducted by John Lott from the University of Chicago Law School in 1996, which examined all 3,054 counties in the United States and conducted over an 18 year period (1977-1994), determined that there is a negative correlation between violent crimes committed and gun permits issued. Why is this?

Criminals are cowards. Just like the middle school playground bullies, criminals rely on power over the weaker, whether this mean physical size, strength in numbers, or a deadly weapon. By allowing more law-abiding citizens to possess firearms--and even carry them on their person, cripples the criminals' advantage. Even if you have no desire to own a firearm, the laws that allow for concealed-carry benefit you as well, because criminals do not know who is or isn't armed.

But what about schools? Surely the last thing we in society should do is to grant hormonal, drunken college kids the ability to purchase and carry firearms around campus. However there is evidence that also supports the contrary, as reported by the not-so-conservative Boston Globe in the article "A Safer Society with Guns." The article explains that the Colorado Supreme Court struck down the firearms-ban at Colorado University, which was followed by an outcry of terror by some. And I can't blame them, as pro-gun as I am, I even have uneasy feelings about letting college kids carry firearms on them around campus. As a hopeful future neuroscience major, it's easy for me to point out that the pre-frontal cortex, the area of the brain responsible for executive function and decision making, is the last part of the brain to fully develop, which does not happen until the average person's mid-20's. With that said, bad decisions are often made by college-age kids, and the thought of college kids making bad decisions with a firearm is morbid. Add alcohol to the mix and that is a recipe for disaster. However, the article then went on to say that Colorado State University, which allows for students to possess and carry firearms on campus, has experienced a crime rate drop of nearly 60 percent since 2004, whereas Colorado University has experienced a crime rate increase of 35 percent in the same time frame. This research was conducted by the independent think-tank The Cato Institute. Many also point out that college students are sitting ducks without guns, as the nation watched in horror as national news outlets covered the tragedy at Virginia Tech. Many large universities (Virginia Tech included), have their own campus police department. This is to provide safety for the students, however, even on campus police can be minutes away, and when a crisis emerges, a minute can be the difference between a shooter killing a dozen people, and a shooter killing no one.

I cannot end this post without discussing the most recent tragedy of the shooting of Trayvon Martin. Trayvon, a 17 year old black male went to the store, while walking back he was approached, shot, and killed by George Zimmerman, an appointed neighborhood watch captain, with a handgun. Trayvon was not armed, and Zimmerman's reasoning was due to "suspicious activity." Zimmerman pleaded self-defense, which, by all accounts seems very unlikely. This story has swept the nation within the last few days, and I'm sure many gun-control advocates will cite this story as a reason to ban guns. I would like to point out that stories such as these are far more likely to get reported. The number of attacks thwarted by the use of guns by law-abiding citizens ranges widely based off of reports, which is understandable, because people are not likely to report a crime that "almost happened." Unfortunately, "Robbers scared off by gun owner" is not a very exciting headline for media outlets, so it is easy to see all of the harm guns do.

Banning guns doesn't stop the bad guys from getting guns, like everything else that is illegal, if somebody wants to get it, they will, through the black market. All gun bans do is stop the law-abiding citizens, the ones who will use their firearms for self-defense, from equipping themselves with protection, while allowing criminals and thugs to prey on them. As gun sales continually increase across the country, I feel safer and safer. I only hope that one day all states, as our Constitution intends, allow for the concealed carry of firearms.

Government Lies: An Easy Guide to Deceiving the Public

            Politicians always promise new things to the people, most recently it was “free” healthcare, other times it may be price ceilings or controlling supply to keep prices low. However some politicians are just as good of actors as the Hollywood celebrities, especially President Obama, who makes his living off of looking into the camera and selling a speech that he most likely did not write, straight from the teleprompter. You may argue that this is irrelevant but it’s much easier to deceive the American public when you are not using your own words. This comfort of President Obama looking into the camera creates a feeling that he is connecting with you personally, and I can only wonder as to how many votes he secured solely based off of this. What’s the key for these politicians? Proper word-usage.

            President Obama is famous for this one: investment. It’s not increased spending because those words have a negative connotation, nobody wants to “increase spending” when the government is quickly racking up a large debt. Another one Mr. Obama loves to use is “increase revenue” which is merely a sly way of saying raising taxes. Frank Luntz, a Fox News pollster said one that Republicans dropped the ball on was “Drill baby, drill!” He points out that this too has a negative association, with dirty black oil oozing out of the ground. Instead, he says they should have used the term “energy exploration.” Unfortunately, there exist very few politicians left who say what they mean and mean what they say.

            President Obama, at the most recent State of the Union address, claimed: “We’ve already agreed to more than two trillion dollars in cuts and savings.” Wow! That’s great! The current federal budget is roughly four trillion, so that means cutting government in half, that’s fantastic, this guy is like freaking Jefferson! Well unfortunately, that’s not even close to the truth. He says he has agreed to two trillion in cuts, but that only means two trillion in proposed increases, not in real cuts. To quote Dan Mitchell from the Cato Institute, “…what if I came to you and said, I’ve been on a diet for the last month and I’ve gained ten pounds! Isn’t that great? You would say, woah, what are you talking about? And I said no, no, I was going to gain fifteen pounds, but I only gained ten, therefore my diet is successful.” This is the exact type of manipulation of words with which politicians have become so adept, and the media eats it up, and regurgitates it to the mindless public.

            Another manipulation occurs when a president tries to pass new legislation or start a new war that will increase spending. For example, the Bush administration projected the war in Iraq to cost between 50-60 billion dollars, so far the cost totals over 800 billion dollars. When Medicare was created in 1990, the government projected a 9 billion dollar cost, whereas the actual cost thus far is about $67 billion. According to Dan Mitchell, this is because politicians “low-ball” numbers and/or do not account for the change in demand for the government hand-out, which is of course intentional. The Congressional Budget Office (CBO), which keeps track of the federal government’s spending, originally gave Obamacare a price-tag of $940 billion over ten years. Which, according to Obama, pales in comparison with the money spent overseas in Afghanistan and Iraq (because you know, two wrong make a right, especially if the Republicans wrong is worse). However, the CBO just announced that the new healthcare law would now cost 1.76 trillion over the ten years, a small miscalculation of—you know, a mere $820 billion.

            Politicians will continually employ these techniques, whether it’s to push for an unfavorable war or conflict, or whether it’s to jam legislation through Congress. Next time you hear a politician talk about new “investments” or “revenue increases”, shake your head, and remember that you can always write him/her nasty e-mails telling him/her what a scam-artist he/she is. 

Government Theft: Eminent Domain

What's yours is yours, because thou shall not steal, right? Well, not exactly. At least if government is the perp, that is not always the case. For those of you who have not heard the term "eminent domain", it means that your private property, your house, camp, whatever--are all truly owned by the state and that if need be, they can be repossessed by the state for sale or destruction in times of extreme necessity or if the central planners determine that the repossessing of your property is ultimately for the public good (some states use the term "appropriation").

Let me give you an example. You have just received a notice from the government that your current home  in which you were born and raised is going to be demolished in order to build a new strip mall. You are reassured that you will be refunded the market value of your house and are given six months to pack up and move out. However, to many, houses are more than just objects like a TV or computer, a house often has sentiment attached to it and now the government is offering you some price based on property value to get you out on their schedule.

But wait! That's my house! I paid for it!

No, no, silly, you only think you own it, but the reality is, the state of New York owns your four bedroom, two and a half bathroom paradise, not you. Plus think of all of the nice tax-money we'll get to make now from all of the incoming businesses! Plus, all of the new stores in the strip mall will create jobs, and if it expands maybe even could lower property taxes in the town because of all the revenue we make! This will help everyone!

This type of nonsense does happen, like in the town of New London, Connecticut, where a host of houses in a neighborhood were demolished against the will of the landowners in order to build a new Pfizer plant (what a surprise, a drug company with political pull). But here's the kicker, after the houses were demolished, the big shots at Pfizer decided they didn't want to build a plant there anymore, oops. This is another example of government failure, businesses are going to want to expand, and any type of handout from the government that they can get, they will take, in this case Pfizer was getting the land for free and huge tax abatements.

Government agencies, particularly the ones steered by the radical environmentalists, also are guilty of abusing eminent domain and disregarding property rights. In January, the EPA declared that the air quality of Matagorda county in Texas was sub-par and that the must halt new business and construction until the air-quality reaches a level that the EPA deems acceptable. All this, despite the fact that the agency in charge of environmental protection of Texas disagrees, citing a decline in both population and emissions in recent years, however the people of the county are at the mercy of the bureaucrats in Washington of the EPA and are unable to pursue business ventures or new construction until the county emission standards raise (I have a lot more to say about the EPA, they will get their own post).

A free society should never have property rights infringed upon, and is a staple if the people of the United States are to retain the freedoms granted by The Constitution. Thankfully, a bi-partisan bill was introduced last year "Private Property Rights Protection Act of 2011" to help protect the liberties guaranteed to Americans under The Constitution.

Why Free Market Medicine Works

Recently, President Obama signed into law "Patient Protection and Affordable Care Act", also known as "Obamacare." While many Americans do not agree with it, President Obama suggested that it was a law that would grow on even Republicans, and one that the whole nation would eventually get behind. However, Republicans have yet to get behind it with almost all calling for its repeal. Other than the obvious un-Constitutionality of the mandate, many Americans also have come to realize that government involvement in medicine will be terrible. As I don't like to play the parties game, it's fair to point out that government has been involved in medicine since 1943, when it first allowed insurance provided by employers tax-free. This trend continued with programs such as medicare, medicaid, social security, and now Obamacare.

You just graduated from college and are an extremely well qualified employee, graduating at the top of your class with much internship experience. Shortly after applying for jobs you hear back from a few businesses that are interested in what you can bring to the table. After discussing your salary and benefits with two of your potential future employers, you discuss benefits with the third. Yearly paid vacation? Sounds good. But no insurance coverage?! Is this guy out of his damn mind? Instead he offers you a Health Savings Account (HSA). He says that every year he will donate $500 dollars to your account, with which you can do whatever you want. Don't need to spend the money the first year? Great, because it builds up, so now for year two, you have $1000 dollars in the account. No insurance, no hassle.

What does that have to do with free-market medicine?

1) Many doctors love the system just fine the way it was. A lot of people who make doctor's office visits have insurance, so the patients just hand the receptionist their insurance cards and carry on. This allows the doctors to charge whatever they want, and then pass the cost on to the insurance companies. However, insurance companies are also in it for a profit, so they will then pass the cost on to the customers. This results in rising premiums and is part of the reason health care is so expensive. Now, with the mandate, since everyone is required by law to have health insurance, this problem is only going to get worse. HSAs would force doctors to compete, lowering prices, while increasing the quality of care. When was the last time you went to your doctor's office and asked: How much for a physical? If more patients did this and shopped around for the best combination of cheap/quality doctor, this would force doctors to expand care, give patients more bang for their buck and lower their overall prices. Prices adjusted for inflation have fallen in several markets while improving the quality of goods, with the exception of the car, where the price adjusted for inflation remains the same or slightly higher, however one must take into account that the cars nowadays do a lot more than the Model-T (GPS, OnStar, air-conditioning, anti-lock brakes, etc.), I digress.

2) HSAs would also encourage people to live a healthier life style. If I am given $500 dollars in my account yearly, maybe I won't go for medical care every time I get a bump on my arm. This is my own money that I'm dealing with here, maybe I should start eating healthier, exercising and getting more sleep. After all, I don't want to exhaust the money in my HSA. Now, I can foresee the argument,  "What if someone is diagnosed with cancer and has tens of thousands of dollars in costs for treatment, and they don't have enough money in their HSA?" Well, a valuable employee is worth more to a company than the cost of the loss of a valuable employee, so in cases such as these, the employee/employer can work something out. Too many people think of a free-market as static, where if you don't have enough money to afford health care, you simply rot in the street. The employer can easily work something out with the employee, as can the hospital, and donations from friendly neighbors are always an option. Doctors have taken a hippocratic oath to help the sick, and by all means, most good doctors will. Why? Because if they don't the news can spread like wild fire, and there you see another benefit of the free-market: consumer choice.

HSAs are the most viable free-market option to health care and give the best results while lowering prices. They keep doctors honest, and can help to make for a healthier nation. Government involvement makes costs sky-rocket, and while supporters of Obamacare think it is the right thing to do, to provide insurance for everyone, it is the wrong approach. Health care's main flaw is it's cost. If the cost of health care dropped, more people could afford it, with or without insurance.


Sources/Inspiration:

http://mises.org/daily/4434

http://www.tomwoods.com/blog/find-it-hard-to-defend-free-market-medicine/

http://www.youtube.com/watch?v=dzm5jhguYJ0



Got questions, comments, or concerns? Feel free to contact me at ryanokonski@gmail.com

Thoughts on the Occupy Wall St. Movement

Occupy Wall St. has been an on-going movement of the frustrated American public since September. By and large, Democrats support the movement calling out in support of the frustrated occupiers, particularly those who are upset about the top 1% possessing 40% of the wealth (according to Joseph Stiglitz, although different economists suggest different numbers) and how powerful big business has become. Republicans by and large, refute the movement, citing the instances of occupiers who are promoting socialism, a complete bailout of students with college-loan debt, and calling for tax hikes on the wealthy.

Although I certainly understand the viewpoints of those who support the movement, and the growing frustration for the inability to solve anything in Washington, most occupiers are taking their frustrations out on the wrong people. The 1% receive special benefits from government, including bailouts, tax-breaks, and in some instances, subsidies. How is that fair?! Blame Wall Street! Blame big business! Greedy bastards! But let's think about this in terms of something many of us know and love--sports.

Your favorite basketball team is playing their rival, and everyone is excited. Throughout the game the ref makes some questionable calls--but they're in the other team's favor. In the end, your team loses. Frustrated after the loss, like any die-hard fan, you start to take your frustrations out on the referee with your buddies. After all,  you wouldn't blame the opposing the head coach for accepting the bad calls, would you?

Of course not, that would be silly. As the size of government continues to metastasize, it seems everybody wants their piece of entitlement pie. Big businesses have become welfare queens, but is it fair to blame the businesses? Businesses are competing amongst one another for a larger share of the market, so any leg-up they can get, they can (and certainly should) try to get. My proposal?

1) Simpler taxes. Business is the great economic engine of a capitalistic society, and burdening businesses with lots of taxes, does not benefit anybody other than the bureaucrats in Washington that like to piss away your tax dollars on ridiculous social programs and departments (but that's a conversation for another post). Business creates wealth, it generates jobs without using your tax dollars (like public sector jobs), and most everybody supports small business because of it. How can you not love the middle-class individual who risks his or her own capital in pursuit of supplying the public with a good or service that the market determines as useful? With that said our current complex tax code requires interpretation by tax lawyers or other tax professionals. What does that mean for the small businessman? It means putting another person on payroll solely to interpret the tax code, otherwise the businessman puts his own business at risk for tax fraud. Who does a complex tax code favor? Big Business. It's easy to put more people on payroll in a fortune 500 rather than a start-up,  so this makes it easier for the big business, while inhibiting the little guy. This is just one example of a barrier to entry, that would not occur under a truly free market. Occupiers, don't like big business? Support a simpler tax code, free of breaks and subsidies. Make it apply to all, big or small.

2) Shrink the size of government. As long as corporations have money, some of it will go to campaign contributions of their favorite bureaucrat. Outlawing these campaign contributions or lobbying efforts is un-Constitutional and is surely a step in the wrong direction. The only reasonable, Constitutional way to go about this is to shrink the size and role of government drastically. For sake of making this a blog post rather than a 20 page paper, I'll save the specifics, for now. But how does this solve anything? If government had it's powers limited to only what the Constitution authorized, government's reduced power would result in less ability for government to interfere with what should be a free-market. In turn, corporations would be incapable of receiving benefits (what many politicians have been calling "government picking winners and losers") from their government. This would also reduce the problem of politicians having a "leg-up" because of excessive campaign contributions from millionaires on Wall Street, and then, in turn, reduce corruption in Washington.

Occupiers should not be occupying Wall Street, rather occupying the Capitol. Businessmen/women are not the problem. They, like many other groups of our nation that have been receiving benefits from big brother government, are just a growing group of beneficiaries. It's hard to turn down free stuff, especially when you can't see out of whose pocket the stuff is being paid for.