Health Care: The Next Round

Open Letter to Senators Warner and Webb

Thank you for voting against cloture on the Senate Health Care Bill. I do appreciate your willingness to vote against your party so that the American people and members of the Senate have some time to read the bill they will be voting on.

In prior communications, I have expressed my concerns around this unprecedented takeover by government of 17% of our economy. I am not in favor of the bill and do not share many of your views about its perceived benefit. In prior correspondence with you, I have outlined my suggestions for “reforming” health care, and will not repeat them here.

When voting on this matter, please take into consideration the actual “accomplishments” of government run programs:

· In 1965, the "Great Society" was created. Eight billion dollars was spent that year; today we are spending $500B annually.

· In 1977, the Department of Energy was created to "make us independent of foreign oil." Now it is a bureaucracy of 18,000 people with a $25B annual budget. We are still dependent on foreign oil, are not allowed to drill off our own shores (but foreign governments can), and have not built a new nuclear power plant since the late 1970s.

· In 1983, a Trust Fund was created to ensure that Social Security was sound for the retirement of baby boomers in 2011. After 25 years of increased payroll taxes, $2.5T was “borrowed” from that fund and every penny spent on something else. Now we want to” borrow” another $1T to "fix" health care while cutting Medicare entitlements to retiring seniors by $500B.

· In 2008, TARP and "stimulus" bills authorized another $1.5T, which is new debt, has not stimulated much of anything except "creating or saving" government – not private sector – jobs.

Not a good track record. I think you need to cut your losses and go back to old fashioned Keynesian economics. Harding / Coolidge in the mid-1020s, Kennedy in the mid-1960s, Reagan in the early 1980s, and Bush in his first administration – contrary to predictions by opponents – cut taxes and government income rose and economic activity and prosperity increased. Hong Kong became an economic powerhouse under a low flat tax. Estonia, Latvia, Lithuania, and Russia have adopted flat taxes ranging from 13% to 33%, all with very positive economic effects. These successes are being copied by the Ukraine and the Slovak Republics. Canada is starting to dismantle portions of its Universal Health Care system because it does not work. In contrast, Japan tried to “spend” its way out of its 1980 recession and it still has not recovered.

Our recent economic meltdown is not traceable to free enterprise run amok. Damage to large portions of our economy is traceable to government social programs and government regulation that create improper economic incentives: the Community Reinvestment Act’s emphasis on lending to unqualified borrowers; Department of Energy and the Environmental Protection Agency regulations, which are at cross purposes; and government graft and corruption (i.e., 13% graft in Medicare and Medicaid, as documented by independent watchdog agencies), to mention only a few.

The next “bubble” is going to be the American debt. Only capitalism – not socialism – will fix this problem, if it is fixable. To paraphrase Margaret Thatcher, “The problem with [the Democrats' ] socialism is, at some point, you run out of other peoples’ money.” The insertion is mine.