Greg Corombos of Radio America and Charlie Cooke of National Review are not surprised to learn the NSA routinely violates the law in accessing our private communications. They also shake their heads as New York City politicians push for even more gun control. And they discuss the latest allegations against San Diego Mayor Bob Filner.
The Obamacare ‘Death Spiral’
The Obama health law is banking heavily on young, healthy people purchasing insurance in order to pay for the care of older and less healthy people, but a new study suggests the administration will struggle mightily to recruit enough young adults to make the system work because it doesn’t make financial sense for them to do so.
That’s the conclusion of a new study by the National Center for Public Policy Research, entitled “Why the ‘Young Invincibles’ Won’t Participate in the Obamacare Exchanges and Why It Matters”.
The Obamacare exchanges open for enrollment on October 1 and the bulk of the law kicks in at the start of 2014. That includes the individual mandate, which requires every adult to carry health insurance or pay an annual fine of $95 that the U.S. Supreme Court deemed a tax in 2012. To make the system work, the government needs millions of young adults aged 18-34 to get on board. Particularly targeted are childless single people.
“They are needed to cross-subsidize people who are older and sicker. If they don’t participate in the exchanges in sufficient numbers, then you run the risk of an insurance death spiral,” said National Center for Public Policy Research Health Policy Analyst David Hogberg, who authored the study and elaborated on the “death spiral” concept.
“This is where not enough young and healthy participate. The price of premiums rise to cover the cost of the older and sicker. Then more young and healthy drop out and the price goes up again. Eventually, a number of insurers are going to drop out of the exchanges because they will be unable to make a profit. So you’ll have fewer insurance companies competing, which also has an effect on the price,” he said. “You basically end up with an exchange pool here that’s older and sicker and the price of insurance is extremely prohibitive. You don’t have an insurance system that really does a good job of covering most people.”
In the exchanges, patients will have the choice of four basic types of plans – platinum, gold, silver and bronze. Platinum offers the most coverage and charges the highest premiums. But even the premium for the bronze plan dwarfs the amount someone will pay for refusing to purchase coverage.
The biggest chore for the administration is convincing healthy young people from ages 18-34 to buy a health insurance policy even though it will be much cheaper for them to pay the fine.
“I ran the numbers and even if you exclude just the people who would pay $1,000-plus in premiums, they would have an incentive to simply forego insurance because it would save them $1,000 and just pay the fine. If you exclude them and include the others who don’t have that incentive, you’d still come up about 780,000 people short, so even under the best of assumptions I don’t think they’re going to reach that number,” said Hogberg, noting that the government needs about seven million people to sign up for the exchange and about 2.7 of them need to be young, healthy adults.
Hogberg points out that a lot of young adults don’t make much money to start their careers and the $500-plus difference per year between buying a health care premium and paying the tax penalty is a huge one, even after the Obamacare subsidies are factored in.
“That’s easily a month’s rent many places in America,” he said, noting the difference could also make a big dent in grocery bills or car payments.
One of Obamacare’s most highly-touted provisions is also working against the administration, namely the rule that allows young adults to stay on their parents’ health plan until age 26.
“If those folks are on their parents’ policy, then they’re not going to be going on the exchanges. That means even less young and healthy people going into the exchanges. The burden in terms of getting enough young and healthy people in there to cross-subsidize the older and sicker is going to be that much more difficult,” said Hogberg.
Hogberg says we’ll know pretty quickly if the exchanges are getting a lot of customers because he expects the administration to trumpet statistics that are favorable to the program. If the numbers are low, he says we probably won’t know until mid-2014, when insurers adjust their premiums based on the initial response. He says if rates jump by 25 percent or more, the exchanges will be headed toward the death spiral.
Three Martini Lunch 8/15/13
Greg Corombos of Radio America and Jim Geraghty of National Review are pleased to see a large majority of Americans disapproving of President Obama’s economic performance. They also groan as the lawyer for former Rep. Jesse Jackson, Jr. blames his client’s criminal behavior on mental illness. And they discuss the pros and cons of the RNC possibly lining up Rush Limbaugh, Sean Hannity and Mark Levin to be moderators for the GOP primary debates in 2016.
‘Jimmy Carter on Steroids’
Clashes between the Egyptian military and supporters of the Muslim Brotherhood left scores dead and hundreds injured Wednesday, and Middle East expert Dr. Mike Evans says the turmoil will eventually lead to an Egyptian civil war.
Evans is a longtime Middle East scholar and is a decades-long friend of Israeli Prime Minister Benjamin Netanyahu. He says radical Islamic elements will keep fighting for their cause and that almost certainly means much more misery for Egypt.
“You’ll have civil war, ultimately, in Egypt. There’s no question about it. It’s not over yet. This is a battle for Islam. It’s not about Democracy. It never was,” said Evans.
He says the fight is really between radical Sunni and Shia elements, both of whom want to establish a Middle East caliphate. He says the Shias want to have Iran as the anchor of the caliphate and Sunnis were hoping to have their base in a Muslim Brotherhood-controlled Egypt.
Millions of Egyptians took to the streets to demand the removal of Mohammed Morsi and his Muslim Brotherhood government in June and early July. The military responded by removing Morsi from power July 3. But while popular sentiment seems to be on the side of the military, Evans says the Muslim Brotherhood is very skilled at molding public opinion.
“About one-third of the population is uneducated and another two-thirds are unemployed. About 60 percent of the population are young people. The mullahs and madrassas are emboldening them and dumbing them down. It’s a real problem,” said Evans, who fears greatly for the Christian population in Egypt.
“They’re in the cross hairs. It’s the same way in the Palestinian territories. They’re hated, they’re despised, they’re considered aligned with the West. It’s a battle,” he said.
Evans is also rolling his eyes over the latest U.S. efforts to foster peace talks between Israel and the Palestinians. The initial round consists of low-level talks set up by Secretary of State John Kerry.
“You’ve got John Kerry on his white horse, trying to save the day by forcing Israel to release terrorists and make peace with the Palestinians, who don’t want peace,” said Evans. “Netanyahu told me personally that there’s things he would not allow: territories, treaties, an army or airspace. In order for the Palestinians to have a state, they have to have treaties. They have to have an army. They’ve got to have airspace. The prime minister will never ever give that up. It’s just not going to happen.
“It’s wrong for Kerry to come in there and give them false expectations, because when he does that he gets people killed. They revert back to the terror card and Jews die,” he said.
So how would Evans sum up the Obama administration’s performance on Middle East policy?
“Barack Obama is Jimmy Carter on steroids. Clinton had it right when he said it was a fairy tale. He doesn’t have any comprehension of what he’s trying to sell. He wants Islam to have their equal rights. He doesn’t understand what they will do with those equal rights,” said Evans.
The Iranian nuclear program is still hanging over the region and the world as well. Evans says covert Israeli activity caused quite a bit of delay in Iran. Despite that, he says Iran is a “screwdriver away from going nuclear.” As a result, he says Israel will soon be forced to take pre-emptive action.
“Israel’s going to do it. Israel will be the U.S. proxy. They’re going to have to do the attack. What Israel’s hoping for is the United States will give them backup for retaliatory targets. There’s about 1,100 hard targets that have to be taken out,” said Evans, who believes the U.S. will provide that support. But he’s convinced the Israeli attack is only a matter of time.
“Everything is on for the attack. It’s going to happen. Something very significant has to happen to stop it,” he said. “It’s definitely on the calendar.”
Three Martini Lunch 8/14/13
Greg Corombos of Radio America and Jim Geraghty of National Review are amused as the panel on MSNBC’s ‘Morning Joe’ extols the superiority of a woman president but cannot explain why. They also cringe as the violence in Egypt escalates. And they try to figure out why President Obama is hosting the 1972 Miami Dolphins next week.
Norquist’s Case for Immigration Reform
The Republican Party remains divided over immigration reform, and one of the biggest sticking point centers on whether to embrace a pathway to citizenship for those in the U.S. illegally.
Americans for Tax Reform President Grover Norquist is actively lobbying for legalization and says changing immigration policy for high-skilled and low-skilled workers is good for America and for the U.S. economy.
“We need to have an immigration policy that allows us to bring a lot more talent to the United States than the present one. The so-called H1B Visa, visas for people with high skills, should be dramatically increased. We should have quite a number of people who bring talent and skills to the United States and allow them to stay and work,” said Norquist. “You come over, you go to MIT or Cal Tech from some other country. We sell you a great education and then we toss you out of the country and say, ‘Go back to India or China or some other country and start a technology company and compete with the United States.
“Why not let people stay here and work if they’d like to and eventually become citizens. We should be doing a great deal more of that. It’s what built the country in the first place,” said Norquist, who says the same approach should be taken to low-skilled workers who come to the U.S. illegally.
“We have a shortage of people willing to work in farming. We have crops rotting in the fields in those states where they decided they didn’t like immigrants coming and working on farms,” he said.
But would legalizing those immigrants have a positive or negative impact on the economy? Norquist cites a Congressional Budget Office (CBO) report showing legalization having a net positive effect. However, the Heritage Foundation estimates that the illegal immigrants who would receive legal status would cost the nation a net $6.3 trillion in government programs. Norquist says the Heritage report is based on “phony numbers” and says the CBO report and another done by former CBO Director Douglas Holtz-Eakin tell the real story.
“It would be a dramatic increase, both in revenue of higher taxes of more people working, way more than any government spending. It just makes sense. If you’re going to grow at three percent a year instead of two percent a year, that’s two-and-a-half trillion dollars in revenue to the U.S. government over the course of ten years,” said Norquist.
Norquist backs stronger border security measures but says the bigger issue is reforming the guest worker program which would reduce the incentive for most illegals. He says President Eisenhower crafted a guest worker program that reduced border apprehensions from one million per year to about 40,000. He says President Kennedy and Johnson then gutted the program as a favor to labor unions and the numbers increased again. He says the same problem happened during the 1986 amnesty debate.
“The most important way to have a secure border is to have a robust guest worker program so that everybody walks through the doors and not try to crawl over the fence,” he said. “Yeah, we should have strong border security. I think that’s useful and helpful, but 90 percent of that is a serious guest worker program.”
Norquist says the Senate bill has a much weaker guest worker program than he would like because Democrats acquiesced to organized labor. He says a House bill would be much better on that front.
Three Martini Lunch 8/13/13
Greg Corombos of Radio America and Bob Costa of National Review discuss the GOP debate over whether to tie defunding Obamacare to funding the government. They also react to the Obama administration adding another unilateral delay to the implementation of Obamacare. And they share their thoughts on “birtherism” being raised at a GOP town hall.
Three Martini Lunch 8/12/13
Greg Corombos of Radio America and Jim Geraghty of National Review are happy to hear Democrats say they plan to run on Obamacare in 2014. They also rip the mainstream media for ignoring several troubling stories about popular New Jersey Senate favorite Cory Booker. And they react to reports that the Obamas’ dog got a separate flight to Martha’s Vineyard.
What’s the GOP Immigration Plan?
Summer recess is underway for the House of Representatives without any votes being taken on immigration legislation. That’s fine with opponents of legalizing millions of illegal immigrants, but the lack of action might well be the deliberate strategy of GOP leaders hoping to get a comprehensive bill passed this year.
The National Journal reported this week that House Speaker John Boehner initially wanted something passed before the August recess but then decided to delay the House action to help members avoid a backlash at town hall meetings.
“If they were to do that, they would be violating the Speaker’s absolute promise that he would not bring a bill to the floor that didn’t have the support of a majority of the Republican Party,” said Gohmert, referring to the so-called Hastert Rule by which leadership requires majority support within their own party before moving on any legislation.
That common understanding of the Hastert Rule seems to be getting a new interpretation from House Budget Committee Chairman Paul Ryan, an ardent supporter of reform. At a town hall this week, a constituent blasted the the GOP over the Hastert Rule and demanded House action on the Senate’s Gang of Eight bill.
Ryan insists he doesn’t want a comprehensive package, but several smaller bills that accomplish the same goals. But he offered a much different method for applying the Hastert Rule.
“Bringing these bills to the floor, we’ll find out,” he said. “It is not, ‘They don’t some to the floor unless we have a majority of the majority,’ because we don’t know if we have a majority until we vote on it.”
Gohmert says that is not the understanding House Republicans have.
“It doesn’t sound like it’s being understood equally by everybody,” said Gohmert, who has high regard for Ryan but says the two are occasionally on “extreme opposite ends” of an issue from time to time. He specifically cites the 2008 debate on the Toxic Asset Relief Program (TARP) in which Ryan strongly backed the Wall Street bailout and Gohmert vigorously opposed.
“There were some good, free market, common sense solutions with giving one bozo from Goldman Sachs $700 billion to go spend like he wanted to,” said Gohmert. “And I think there are better solutions here than what they’re talking about.
“There’s no sense talking about legalization of anybody until you control your own border because you’re inviting people to do exactly what they’re doing, and that is come in numbers 3-5 times more than they were before,” he said. “Secure the border and quit talking about legal status until it’s secure. Then we’ll get this stuff worked out.”
Another blow for border security advocates came this week from Arizona Sen. John McCain, a member of the Gang of Eight, who indicated that he would work to greatly reduce the Senate plan for 20,000 new border agents when the issue heads to a House-Senate Conference. Gohmert says he highly respects McCain’s service to this country, but is disappointed at the senator’s approach to this issue.
“He just doesn’t get it,” said Gohmert. “When you keep trying to do a bill that deals with people illegally in the country and you still haven’t secured the border, then there’s no use having a bill. The president has the money, he’s got the manpower, he’s got the ability, just like Woodrow Wilson did when he completely secured the border.
“He could do it if he wants to and we don’t need to have the administration and people like Senator McCain saying, ‘OK, we’ll put this in the bill and allow him to extort legalization for people that are illegally here or citizenship for people that are illegally here in return for him finally doing the job he is sworn to do,” said Gohmert.
The congressman isn’t sure how big of an issue immigration will be at town hall meetings around the country this month. He says people want the border secured but are otherwise focused on bigger issues.
“They want tax reform like we’ve promised for years. Let’s go to a flat tax. Let’s throw out the IRS,” said Gohmert. “People want to know what happened at Benghazi. People don’t want their government doing any more spying than they are. Those are the issues that I’m hearing more from, except for those that are getting paid to make a big deal out of trying to legalize people that are illegally here.”
Three Martini Lunch 8/2/13
Greg Corombos of Radio America and Katrina Trinko of National Review cheer the Republican National Committee for warming up to the idea of having the national convention earlier in the summer in 2016. They also shake their heads as Vladimir Putin runs roughshod over President Obama once again. And they react to the July jobs report and a poll showing a record number of young adults still living with their parents.