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Friday, April 6, 2012

Want To Watch Government Corruption Unfold In Real Time?  Stay Tuned Here!

O.K. here is the background. In the Southwestern United States, there is a HUGE desert called the Mojave.  A small part of the desert that is in California is called the Anza Borrego Desert and a part of it is a state park.  And in that desert there is a body of water called the Salton Sea.

About a 100 years ago, the canal that moves water from the Colorado River to Los Angeles ruptured and a lot of water escaped.  The water ran down hill (as you would expect) until it reached a low spot in the desert, but from there could run no farther, and that body of water is named the Salton Sea.

There is no way to replenish the water as it evaporates except for agricultural run off which is full of fertilizers and pesticides.  So over the years, the chemical content of the water has built up to staggering levels.  Most of the fish in the Sea have died off and migrating birds no longer use it as resting place on their migration.

Now there are three things in particular that distinguish the Salton Sea.

1)  It stinks all year round.  And I don't just mean smells bad.  I mean it stinks so badly that it takes you breath away.  It is worse than the worst mistake you ever made in high school chemistry.

2)  Summer temperatures reach 120F and more.  I don't know if you have ever experienced temperatures that high, but when you step outside it is like being hit with a huge fist.

3) The Salton Sea is surrounded with deserted buildings, houses, trailers, some of which have been burned to the ground, and garbage and trash.  The Salton Sea Marina is an empty slab of concrete on the western edge of the Sea.

O.K., got the idea.  It is an awful place to visit, let alone live there.  But, and here comes the corruption in action story, a developer wants to build a huge new town on the edge of the Salton Sea.  The plan envisions thousand of new homes, offices and factories.  So here comes the corruption part; the Riverside County Supervisors all know 1, 2 and 3, and still they voted to approve the project.  The stink of money here is even worse than the stink of the Salton Sea itself.


The story by Nate Berg  below fills in the details.  Stay tuned for future developments.


Can a Sustainable Town Be Built From Scratch in the Middle of Nowhere?

Can a Sustainable Town Be Built From Scratch in the Middle of Nowhere?
Travertine Point
Its developers are holding it up as one of the greenest, most sustainable plans for a new town development, but it's also being attacked by environmental groups for its unlikely – and historically unlucky – location. The project is a proposed brand new town that aims to eventually house about 37,000 people, their jobs and the commercial activity to sustain their economy, all overlooking the northwest shores of the deeply troubled Salton Sea in the Colorado Desert of Southern California, the largest body of water in the state.

Travertine Point, as the project's known, has been in the works since 2005 and represents some of the most progressive ideas in urban planning, town design and environmental sustainability. But at roughly 20 miles from the communities neighboring Palm Springs, how far away this project is from the rest of the populated parts of the Coachella Valley is equally as concerning as how close it is to the Salton Sea, an accidental lake that has slowly devolved into a toxic, smelly and potentially deadly body of less and less water.
The fate of the Salton Sea has long been up in the air, which makes the prospect of creating a city on its shores a gamble. But long-simmering restoration plans are now looking toward development – and even controversial projects like Travertine Point – to help generate some of the likely multi-billion dollar cost of bringing the sea back to life.

"We think it’s the most sustainable community that’s been planned and approved by any county in California right now," says Paul Quill, who's representing Federated Insurance, the developer of the project.

Travertine Point is planned to be a mixed-use town of more than 16,000 homes, 5 million square-feet of commercial space, a network of low-speed streets, accessible parks and a design that aspires toward self-containment. It's proposed to be phased in over 35 years, with certain job creation requirements pegged to each phase of new housing development. Quill argues that the plan is a vast improvement compared to how development typically occurs in the area.

"It’s a new town, it's hub and spoke. It's not just 40-acre subdivision after 40-acre subdivision of single family homes that dump out onto arterials," Quill says. "This is a well integrated, well thought-out plan."
The developers have managed to convince Riverside County, which approved the project in February.
"We were very rigorous with these applicants, far moreso than we were with any other project the county's processed because we were quite skeptical, to be frank," says Matt Straite of the Riverside County Planning Department. "We really set the bar very high for this project."

That translates into requiring more density in the nearly 5,000-acre site, putting an emphasis on reducing car trips for residents' daily needs, and calling for stricter job creation goals. The first phase of development requires 355,000 square-feet of commercial and mixed-use space to be built in conjunction with the first batch of about 3,200 homes. Another 827,000 square-feet of commercial space is required in the next phase.

"It's incumbent on the applicant to assure that those jobs are there," Straite says. "If they have to build the building for free and give it away to make sure those jobs are there, hell, even if they have to subsidize those jobs, it's their responsibility to make sure those jobs are in place and functioning."

The plan is widely seen as forward-thinking. Its choice of location, less so. Soon after the project was approved, a lawsuit was filed jointly by the Sierra Club and the Center for Biological Diversity alleging that the project is out of place and if built would have severely negative impacts on natural and cultural resources in the area.

"There are aspects of the project that, if the project were located in a different area, would be somewhat progressive. Out here it just doesn’t make sense," says Erin Chalmers, an attorney representing the Sierra Club. "My client is certainly skeptical of whether this project makes sense or will ever make sense."
In addition to being located next to sensitive wildlands and protected areas, the site of the proposed project is in a part of California with a strong Native American heritage. The nearby Torres-Martinez Desert Cahuilla Indians have partnered with Federated Insurance on the project, but the Sierra Club and Center for Biological Diversity worry it doesn't do enough to buffer the proposed city from its natural surroundings.

If you pull over off the side of state highway 86S, hop a fence and climb up a small hill, you can look down upon the proposed future site of Travertine Point. The vast Salton Sea stretches out from this point near its northern tip. The land right up against the water is now mainly agricultural, and large plots of citrus and palm groves can be seen far into the distance. The small farming towns that sprinkle the land out here are wildly different from the gated golf estates just about 20 miles north in La Quinta, Palm Desert, and Palm Springs. Looking down on this land, it's difficult to imagine the development of the north replacing the wide farms that fill this seaside section of the valley.

A major concern about the idea of making such a transition in this location is the mostly failed residential developments of the past that now litter the shores of the Sea – mistakes few want to see repeated.
"There's something like 30,000 unbuilt but approved lots around the Salton Sea," says Chalmers. "We're just not sure what is so different now that's going to make people want to move to this area, especially given the current problems of the Salton Sea."

Created unintentionally in 1905 when the rupture of a dike brought water from the Colorado River to this below-sea level sink, the Sea gradually became a popular recreation area that once rivaled Yosemite National Park for attendance levels. Around mid-century, its shores were developed into a number of resort towns, including Desert Shores, Salton Sea Beach and Salton City, each on the Western shore and just a few miles south of the proposed Travertine Point site.

Driving through these little towns, it's hard not to get a creepy, post-apocalyptic feeling. There's still people living here – nearly 4,000 in Salton City, according to the 2010 Census – but so much of the land on these small asphalt streets is empty and abandoned. Burned out trailers pockmark these towns, and despite a vast network of roads carving through Salton City, the majority of the blocks they create are empty but for one or two homes.

These shoreline resort towns have declined over the years in conjunction with the slow demise of the Salton Sea itself. Despite its unintended creation, the Sea has been maintained by water contributions from various sources over the years, including some Colorado River water but mainly agricultural runoff from the farms that fill in the valley around the Sea. Over time, this runoff water has greatly increased the salinity of the Sea, making it nearly 25 percent saltier than ocean water. This salinity coupled with the extremely high temperatures of the desert cause regular mass die-offs of the few species of fish still able to survive here. Hundreds of thousands of fish have been observed to succumb to these die-offs in a single day. Their rotting corpses and the hot sun produce a stench that can be overwhelming.

"Hopefully you were lucky enough that nothing happened when you were here," says John Kariotis, of the West Shores Salton Sea Growth Association and a longtime resident of Salton City. I assure him that my recent trip was apparently a lucky one. "Good, good," he says. "I'm glad."

He knows the problems of the Sea firsthand. Though he concedes that the thought of 37,000 people moving to a new city regularly blasted with the odors of dead fish is probably not an attractive selling point, he says Travertine Point can be part of the solution.

"Everybody around here wants the project to happen. We see that, yes, it is a funding mechanism to restore the sea," Kariotis says.

Infrastructure financing districts tied into the project's plan would help contribute money to a multi-billion dollar restoration plan [PDF] being pushed by the Salton Sea Authority. The plan encourages even more development around the sea, up to 250,000 homes, and the development of a renewable energy sector in the area, especially near the geothermal resources at the south end of the sea. The Travertine Point plan is relying on the growing renewable energy sector to provide the jobs and justification for the city's development.

Restoring the Salton Sea is really about more than jobs, though. Because of the high nutrient and chemical content of the runoff that feeds the Sea, the soil at its shallow bottom would be highly toxic if allowed to dry into dust.

"If it dries up, everybody in the whole Coachella Valley is affected," says Kariotis. "It would make Three Mile Island look like nothing.
"
Quill says the environmental threat and the sheer amount of people that would be affected by such a problem virtually guarantee that it wouldn't be politically feasible for the Sea to be left to dry. He says projects like Travertine Point can help to provide some of the funding to help get those restoration plans going, and Riverside County tends to agree.

Michael O'Connor, executive director of the Salton Sea Authority, is also hopeful that projects like Travertine Point will be able to help spur restoration efforts.

"It helps to have critical mass being built," O'Connor says. "There's a great many ways the sea needs to be restored and no one thing can probably do it."

Chalmers counters that the challenge of restoring the sea is so large and time consuming that building a city on its shores with only the hope that it will be restored is too much of a gamble.

"The Sierra Club is skeptical that this will ever pencil out. This seems to be based more on, frankly, kind of a wild optimism rather than reality as far as we can tell," Chalmers says. "But if the Salton Sea does get restored some day, then this area might grow and the Sierra Club recognizes that."

Despite this skepticism, Chalmers says his client is not out to kill the project. They are hoping their lawsuit will bring about "specific and enforceable mitigation measures" to prevent Travertine Point from having too negative an impact on its surroundings. A settlement conference is scheduled for later this month. If the case does go to litigation, it could be in courts within a year, Chalmers says.

This prospect is not much of a concern for the developers, according to Quill. He's not expecting to break ground on the project for at least four and as many as 10 years.

"We're not in a hurry. We have time to work with them, we have time to deal with them, we have time to get through the courts, everything," Quill says.

"We believe that we can be a catalyst for Salton Sea restoration efforts that we think need to occur," Quill says. "Both the way we've designed this community and the way we've created this plan is really a model for the kind of edge development that should be happening in California going into the future."
Photo credits: Nate Berg. Top image: Travertine Point.
Nate Berg is staff writer at The Atlantic Cities. He lives in Los Angeles. All posts »

Now all they have to do is find 35,000 people who have lost their sense of smell and are impervious to heat from a blast furnace. And be sure to read all the comments that you can find at the link All posts, which you can find just above.
 

Tuesday, April 3, 2012

WOW!!  I DIDN'T SEE THIS ONE COMING!!

The other day, we got a letter from a medical group we use.  There are two paragraphs that you will find extremely interesting.  Here they are.

"The cost of running such a pulmonary practice, however, is becoming prohibitively expensive because we are forced to perform more and more administrative tasks without reimbursement.  For example, our physicians only prescribe quality and necessary drugs and treatment, but both they and our office staff spend an inordinate amount of time filling out extensive forms and making phone calls to insurance companies to justify the treatment plan.  In addition, insurance companies make many more mistakes on their reimbursement, from 20%-40% of the time, and our staff spends more and more time with them re-billing for their errors.  This was simply not the case several years ago."

There is a lot more, but here is the KICKER!!

"A better alternative is to simply receive a yearly $350 administrative fee from all our patients.  The fee will be billed on May 1 of each year.  This allows us to continue to participate in Medicare and private insurance plans.  Because all administrative costs will be covered, including the charges mentioned above, we will be able to to continue our practices of uninterrupted, excellent medical care."

Wow!!  We see four medical specialty groups a couple of times a year.  If they all adopt this idea, our healthcare costs will go up $1,400 a year for EXACTLY the same service.  If this doesn't make you understand we have to get control of our Healthcare Costs, then I don't know what will!!
The Pink Slime Of The Republican Party Lays Out His Plan To Destroy America (at least for anyone not in the 1%)

Ezra Klein lays it out clearly in today's Washington Post.  Read it and weep.

Paul Ryan betrays his own views on income inequality

By , Updated: Tuesday, April 3, 7:33 AM

On Thursday, the House of Representatives passed Rep. Paul Ryan’s 2013 budget proposal. The plan’s pleased author didn’t mince words. “We are bearing witness to history this week,” Ryan said.



But my thoughts kept returning to something Ryan said five months earlier. The occasion was an October speech at the conservative Heritage Foundation. Again, Ryan really leaned into the historic moment. His remarks were titled “Saving the American Idea: Rejecting Fear, Envy and the Politics of Division,” and they were Ryan’s bid to make a different sort of history: to be the first national Republican to lay out a coherent theory on income inequality and what needs to be done about it.
“Class is not a fixed designation in this country,” Ryan said. “We are an upwardly mobile society with a lot of movement between income groups. The Treasury Department’s latest study on income mobility in America found that during the 10-year period starting in 1996, roughly half of the taxpayers who started in the bottom 20 percent had moved up to a higher income group by 2005.”
Upward mobility, Ryan said, is the real key to the “American idea.” But that idea was under threat — and not, as so many seemed to think, because of Republicans or low tax rates on billionaires. The real danger, Ryan argued, was coming from the Democrats and the programs they support. It was classic Ryan: A wonkish effort to recast an issue on which Republicans had traditionally been weak as a policy problem that only conservatism could solve. And it didn’t end there.
Two weeks later, in a 15-page report entitled “A Deeper Look at Income Inequality,” Ryan made his argument again — but this time with more charts. “Conventional wisdom on government’s role in inequality often has it backwards,” he wrote. “Tax reforms have resulted in a more progressive federal income tax; government transfer payments have become less progressive (due in large part to growing entitlement payments to wealthier seniors).”
Ryan went on to endorse the “the growing bipartisan consensus to target corporate welfare, to income-adjust entitlement programs and to reform the tax code by removing loopholes and lowering barriers to growth.”
Ryan’s presentation was persuasive. He’s right that the growth of social spending on the elderly is crowding out spending on the poor. And he was more convincing because he seemed to admit a hard truth that Republicans often deny: that government programs for the poor are a crucial way of ensuring income mobility, and as they get squeezed, so, too, do the life chances of those born at the base of the income ladder.
But it is difficult to believe that Ryan’s budget was written by the same guy who wrote this paper. Because in Ryan’s budget, Social Security is untouched. The cuts to Medicaid and other health programs for the poor are twice the size of those to Medicare. The cuts to education, to food stamps, to transportation infrastructure and to pretty much everything else besides defense are draconian. As for the tax reform component, it cuts taxes on millionaires by more than $250,000, but it doesn’t name a single loophole or tax break that Ryan and the Republicans would close.
In the end, the Center on Budget and Policy Priorities estimates that 62 percent of the cuts come from programs for low-income Americans and 37 percent of the tax benefits go to the few Americans earning more than $1 million.


In other words, Ryan’s budget fails even Ryan’s tests for encouraging social mobility: It focuses its cuts on programs for the poor rather than programs for seniors, and it doesn’t eliminate any tax loopholes. (Ryan’s office didn’t respond to requests for comment on this piece.)

As Ryan argued in his October speech, the government does have a role in encouraging social mobility: It helps close the gap between the children of the poor and the children of the rich. Food stamps and other food-assistance programs help with nutrition. Public education and Pell grants help with skills. Medicaid — which covers more than 25 million children — helps with access to health care. But Ryan’s proposed cuts would hit these programs with particular force.

“Ryan’s plan is a privatization of the prerequisites for opportunity,” says Jacob Hacker, author of “Winner-Take-All Politics.” “And so they become the province of people whose parents have made it.”
Bob Greenstein, director of the Center on Budget and Policy Priorities, points to Ryan’s cuts to education: “Lower-income students are more likely to go to public universities and community colleges. But lately, state budget cuts are leading to tuition increases. The Ryan budget would further decimate state budgets, because one of the areas of the budget he hits the hardest is ‘non-security discretionary spending,’ of which 35 to 40 percent of that category is aid to cities and state governments. Normally, you would increase Pell grants to help with this. But he’s slashing Pell grants, too!”

To put it slightly differently, no millionaire’s child will find that Ryan’s budget ends her hopes of a college education. But plenty of lower-income children will. And in the long run, that’s bad for mobility, bad for growth and bad for the country. “If you don’t have a society that allows non-elites to have a serious shot of sharing in economic prosperity, there’s a huge untapped potential for economic growth,” Hacker says.
Five months ago, Ryan knew that. He condemned “empty promises that betray the powerless” and praised “the American idea that justice is done when we level the playing field at the starting line.” But it is hard to see his budget as anything less than a betrayal of the powerless. And as for the American idea that justice is done by leveling the playing field at the starting line? Well, perhaps Ryan could include that in his next budget. Then he would really be making history.

Monday, April 2, 2012

Michael Pretty Much Tells The Truth And I Find It Hard  To Disagree With His Facts.  But His Forecast Is Another Thing.  Anyway, You Should Read This.

The 15 Trillion Dollar Party

If you knew that you could live in luxury for the rest of your life but that by doing so it would absolutely destroy the future for your children, your grandchildren and your great-grandchildren would you do it?  Well, that is exactly what we are doing as a nation.  Over the past several decades, we have stolen 15 trillion dollars from future generations so that we could enjoy a dramatically inflated level of prosperity.  Our 15 trillion dollar party has been a lot of fun, but what we have done to our children and our grandchildren has been beyond criminal.  We ran up the greatest mountain of debt in the history of the planet and we are sticking them with the bill.  Sadly, both political parties have been responsible for the big spending that has been going on.  Both Democrats and Republicans have run up huge budget deficits when in power.  But instead of learning the hard lessons of the past, both political parties continue to vote for even more debt.  They would rather continue to steal trillions of dollars from future generations than have the party end and have to face the consequences.

And the consequences will be dramatic when the party ends.  During fiscal year 2011, the U.S. government spent 3.7 trillion dollars but it only brought in 2.4 trillion dollars.  That means that the U.S. government spent about 1.3 trillion dollars that it did not have.  It is important to understand that even if the U.S. government spent that 1.3 trillion dollars on really stupid things, that money still got into the pockets of ordinary Americans who then spent it on things like food, gas, housing, etc.  In turn, most of those that received money from providing those goods and services would spend it on other things.

So extra government spending can definitely stimulate the economy.  The problem is that we have been doing it permanently.  Since 1975, we have added more than 15 trillion dollars to the national debt.  This has fueled a false prosperity that was way beyond what we could afford.

If the U.S. government tried to go to a balanced budget now, our standard of living would crash and there would be riots in the streets.  The American people have been enjoying false prosperity for so long that they have lost any notion of what "normal" actually is.

Think of it this way.  If your family makes $40,000 this year and you spend an extra $20,000 on your credit cards, your family would be enjoying a false sense of prosperity.

You could do that year after year as long as the credit card companies keep loaning you more money.
But debt always catches up with you in the end.

It is the same thing with the United States.
We have been running up our national credit card balance and the interest payments have become quite painful.

The U.S. government spent over 454 billion dollars just on interest on the national debt during fiscal 2011.
That is 454 billion dollars that the people of the United States do not receive anything in return for.
So in order to keep up with interest on the national debt and to enjoy a standard of living that is beyond our means we now have to run deficits that are in excess of a trillion dollars every single year.
And a trillion dollars is a staggering amount of money.
If right this moment you went out and started spending one dollar every single second, it would take you more than 31,000 years to spend one trillion dollars.

Since Barack Obama was elected, the U.S. government has added about 5 trillion more dollars to the national debt.

That kind of debt is a recipe for national financial suicide.

How are we supposed to explain to our children that we are passing a debt of $15,579,852,946,457.64 down to them?

At this point, the United States government is responsible for more than a third of all the government debt in the entire world.

The 15 trillion dollar party that we have been enjoying has been amazing, but all of that debt is soon going to bring us a tremendous amount of pain.

And there is really no way out under our current financial system.  As our population ages, government budget deficits are projected to spiral wildly out of control in future years.

Already, entitlement programs are starting to cause massive problems.  For example, mandatory federal spending surpassed total federal revenue for the first time ever in fiscal 2011.  That was not supposed to happen until 50 years from now.

If the federal government used GAAP (Generally Accepted Accounting Principles) like all publicly-traded corporations are required to do, the situation would be much worse.

The truth is that the U.S. government never had a "balanced budget" during the end of the Clinton administration.  The federal government was borrowing gigantic amounts of money from the Social Security trust fund to finance regular government operations.  It was a big fraud.  Under GAAP, there would have been huge budget deficits during those years.

And even under the non-GAAP numbers used by the U.S. Treasury Department, the U.S. national debt still increased every single year during the Clinton administration.
So let's get real.

Our national financial situation has always been much worse than we have been told.
It has been estimated that our current budget deficits would be in the neighborhood of 4 to 5 trillion dollars under GAAP.

And looking down the road a bit, we are facing a tsunami of unfunded liabilities that is absolutely nightmarish.
In other words, we have committed ourselves to tens of trillions of dollars of expenses that we don't have any money for.

According to Professor Laurence J. Kotlikoff, the U.S. is facing a "fiscal gap" of over 200 trillion dollars in the coming years.  The following is a brief excerpt from a recent article that he did for CNN....
The government's total indebtedness -- its fiscal gap -- now stands at $211 trillion, by my arithmetic. The fiscal gap is the difference, measured in present value, between all projected future spending obligations -- including our huge defense expenditures and massive entitlement programs, as well as making interest and principal payments on the official debt -- and all projected future taxes.
And it just keeps getting worse.  Recently it was revealed that Obamacare will add 17 trillion dollars more to our long-term unfunded obligations.

Basically what we have done is we have committed future generations to a life of endless debt slavery to pay for our debts and for the financial promises that we have made.

How could we be so stupid?

Of course this entire fraudulent system is going to completely collapse before we get too much farther down the road anyway.  Right now the whole thing is essentially being held together by chicken wire and duct tape.
Most Americans do not realize this, but the Federal Reserve bought approximately 61 percent of all government debt issued by the U.S. Treasury Department in 2011.

Normally, the Federal Reserve is not supposed to be doing this.

But right now there are not nearly enough buyers of U.S. government debt at the super low interest rates that the U.S. government wants to pay.  A recent Money News article explained that foreigners have been increasingly shying away from U.S. debt....
"In 2009, such foreign purchases of U.S. debt amounted to 6 percent of GDP and has since falled by over eighty percent to a paltry 0.9 percent."
Instead of interest rates on U.S. Treasuries rising to attract additional investors, the U.S. Federal Reserve has been intervening to make up the difference.This is essentially "monetizing the debt" and it is something that Ben Bernanke promised that he would never do.

But he is doing it.

If the Federal Reserve was not buying up all this debt, interest rates on U.S. debt would soar and so would U.S. government interest payments.

Yes, this is a giant Ponzi scheme and it cannot last for long.

Of course all of this could have been avoided if our politicians had not been running up such massive amounts of debt all these years.

Some have suggested that our problems could be solved by simply increasing taxes on the wealthy.
Well, the truth is that the top 5 percent of all income earners already pay nearly 50 percent of all federal taxes and soaking them even more will not even come close to solving the federal budget crisis.
For example, if Bill Gates gave every single penny of his fortune to the U.S. government, it would only cover the U.S. budget deficit for 15 days.

And as Bill Whittle has shown, you could take every single penny that every American earns above $250,000 and it would only fund about 38 percent of the federal budget.
So taxing the wealthy will certainly not solve all of our problems.

In fact, when you tax the wealthy and the "somewhat wealthy" it slows economic growth in a number of different ways.

Number one, they have less money to spend into the economy.
Number two, they have less money to invest in business activities.
Number three, it gives wealthy individuals and corporations more of an incentive to move out of the United States.  As I have written about previously, the global elite are already hiding about 18 trillion dollars in offshore banks.  The U.S. government keeps trying to tap into all of that offshore wealth, but the elite always seem to be a few steps ahead of the game.

Yes, we should try to close loopholes in the tax system, but the truth is that the root cause of our problem is that the federal government is simply spending way, way too much money.

Right now, spending by the federal government accounts for about 24 percent of GDP.  Back in 2001, it accounted for just 18 percent.

But our politicians always want to put off spending cuts for another day because they know that immediate spending cuts would really hurt the economy.

For example, just check out this recent quote from White House Chief of Staff Jack Lew....
“The time for austerity is not today,” Lew told NBC News “Meet the Press.” “If we were to put in austerity measures right now, it would take the economy in the wrong way.”
Yes, the Obama administration definitely does not want to hurt the economy with an election coming up in a few months.

So when will it be time to seriously cut government spending?

The day never seems to arrive.

But even though the federal government has been pumping more than a trillion extra dollars into the economy every year, the economy has not shown much improvement.  The percentage of working age Americans that have jobs has barely budged for over two years.

Yes, the policies of the Obama administration have stabilized the U.S. economy for the moment, but if he was actually going to tell the truth he would say something like this....

"By mortgaging the future of our children and our grand-children I have stabilized our economic statistics for the short-term.   Unfortunately, I am going to have to continue to financially abuse future generations to keep us from falling into another Great Depression.  Meanwhile, I am making our long-term financial problems far, far worse.  But the most important thing is that I win re-election so that I can continue to be president.  Thank you for being so selfish and so willing to destroy the future of your children.  Vote for me in 2012 and let the party continue!"

Unfortunately, the party is going to come crashing to an end at some point.
Right now, the global financial system is based on the U.S. dollar and on U.S. government debt.
There will come a time when the rest of the world is going to get sick and tired of watching this Ponzi scheme play out and they are going to completely lose faith in the U.S. dollar and in U.S. government debt.  In fact, there are already signs that this is starting to happen.

When faith in our currency and our debt is completely gone, it will be nearly impossible to get back and the game will be over.

The false prosperity that we are experiencing right now is about as good as things are going to get.
Enjoy it while you still can, because when it is gone that will be the end of it.
Both the Democrats and the Republicans have failed us.  They played fast and loose with our future and they never planned for the long-term.

Now we are facing a collapse of unprecedented magnitude that most Americans will never even see coming.

A horrifying economic collapse is coming.

You better get ready for it.

And if you want to know what a TRILLION dollars in $100 bills looks like, see The Great Recession Conspiracy at the end of Section One.

And now you know why Ron Paul is so adamant about doing away with the Federal Reserve Bank. 
Another Voice Saying Macro Economic Theory Is All Crap, And Dangerous!!

From Today's New York Times comes this insightful piece.

 

Throw Out the Probability Models

Nassim Nicholas Taleb
Nassim Nicholas Taleb, a former derivatives trader, is a distinguished professor of risk engineering at Polytechnic Institute of New York University. He is the author of "The Black Swan: The Impact of the Highly Improbable."
Updated April 1, 2012, 7:00 PM
After the events that started in 2007 and the subsequent reactions by economists, anyone who takes the current economics establishment seriously needs to spend time in a sanatorium.
We would have great jumps in knowledge if we avoided teaching these models, and replaced them with anything, even gardening classes.
This does not mean we should write off the entire body of knowledge. By now, we can see what works and what does not work. Simply, a certain class of consequential rare events, what I’ve called “black swans,” are not predictable and their probabilities unmeasurable, so anything that relies on a computation of the probability of these events should go out of the window. Now. Such models induce fragilities and bring harm. We're better off with no model than with a defective model, something people understand intuitively, but they tend to forget when they don’t have “skin in the game.” If you are a passenger on a plane and the pilot tells you he has a faulty map, you get off the plane; you don’t stay and say “well, there is nothing better.” But in economics, particularly finance, they keep teaching these models on grounds that “there is nothing better,” causing harmful risk-taking. Why? Because the professors don’t bear the harm of the models.

The good news is that those models that miss rare events also break down when one introduces a higher layer of uncertainty into them, called “parameter uncertainty”. This gives us a faulty detection mechanism. What goes out of the window? The entire discipline of modern finance and portfolio theory (the theories named after Harry Markowitz, William Sharpe, Merton Miller), the model-based methods of Paul Samuelson, much of time series econometrics (which don’t appear to predict anything), along with papers and theories that are based on “optimization.” These bring fragility into the system. So, simply, we would have great jumps in knowledge if we avoided teaching these models, and replaced them with anything, even gardening classes.

But the broad principles of economics survive such expurgation. We should just ignore much of what has happened in the past half-century of trying to be too sophisticated with quantitative and probability-based models, ending up in dangerous pseudo-science.
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I Am Not The Only One Who Thinks Paul Ryan Equals Pink Slime!!!!

Check out today's Paul Krugman take on the Republican's leading scum bag!!

Pink Slime Economics

The big bad event of last week was, of course, the Supreme Court hearing on health reform. In the course of that hearing it became clear that several of the justices, and possibly a majority, are political creatures pure and simple, willing to embrace any argument, no matter how absurd, that serves the interests of Team Republican.

But we should not allow events in the court to completely overshadow another, almost equally disturbing spectacle. For on Thursday Republicans in the House of Representatives passed what was surely the most fraudulent budget in American history. 

And when I say fraudulent, I mean just that. The trouble with the budget devised by Paul Ryan, the chairman of the House Budget Committee, isn’t just its almost inconceivably cruel priorities, the way it slashes taxes for corporations and the rich while drastically cutting food and medical aid to the needy. Even aside from all that, the Ryan budget purports to reduce the deficit — but the alleged deficit reduction depends on the completely unsupported assertion that trillions of dollars in revenue can be found by closing tax loopholes.
And we’re talking about a lot of loophole-closing. As Howard Gleckman of the nonpartisan Tax Policy Center points out, to make his numbers work Mr. Ryan would, by 2022, have to close enough loopholes to yield an extra $700 billion in revenue every year. That’s a lot of money, even in an economy as big as ours. So which specific loopholes has Mr. Ryan, who issued a 98-page manifesto on behalf of his budget, said he would close? 

None. Not one. He has, however, categorically ruled out any move to close the major loophole that benefits the rich, namely the ultra-low tax rates on income from capital. (That’s the loophole that lets Mitt Romney pay only 14 percent of his income in taxes, a lower tax rate than that faced by many middle-class families.)
So what are we to make of this proposal? Mr. Gleckman calls it a “mystery meat budget,” but he’s being unfair to mystery meat. The truth is that the filler modern food manufacturers add to their products may be disgusting — think pink slime — but it nonetheless has nutritional value. Mr. Ryan’s empty promises don’t. You should think of those promises, instead, as a kind of throwback to the 19th century, when unregulated corporations bulked out their bread with plaster of paris and flavored their beer with sulfuric acid.
Come to think of it, that’s precisely the policy era Mr. Ryan and his colleagues are trying to bring back.
So the Ryan budget is a fraud; Mr. Ryan talks loudly about the evils of debt and deficits, but his plan would actually make the deficit bigger even as it inflicted huge pain in the name of deficit reduction. But is his budget really the most fraudulent in American history? Yes, it is. 

To be sure, we’ve had irresponsible and/or deceptive budgets in the past. Ronald Reagan’s budgets relied on voodoo, on the claim that cutting taxes on the rich would somehow lead to an explosion of economic growth. George W. Bush’s budget officials liked to play bait and switch, low-balling the cost of tax cuts by pretending that they were only temporary, then demanding that they be made permanent. But has any major political figure ever premised his entire fiscal platform not just on totally implausible spending projections but on claims that he has a secret plan to raise trillions of dollars in revenue, a plan that he refuses to share with the public? 

What’s going on here? The answer, presumably, is that this is what happens when extremists gain complete control of a party’s discourse: all the rules get thrown out the window. Indeed, the hard right’s grip on the G.O.P. is now so strong that the party is sticking with Mr. Ryan even though it’s paying a significant political price for his assault on Medicare.

Now, the House Republican budget isn’t about to become law as long as President Obama is sitting in the White House. But it has been endorsed by Mr. Romney. And even if Mr. Obama is reelected, the fraudulence of this budget has important implications for future political negotiations.
Bear in mind that the Obama administration spent much of 2011 trying to negotiate a so-called Grand Bargain with Republicans, a bipartisan plan for deficit reduction over the long term. Those negotiations ended up breaking down, and a minor journalistic industry has emerged as reporters try to figure out how the breakdown occurred and who was responsible. 

But what we learn from the latest Republican budget is that the whole pursuit of a Grand Bargain was a waste of time and political capital. For a lasting budget deal can only work if both parties can be counted on to be both responsible and honest — and House Republicans have just demonstrated, as clearly as anyone could wish, that they are neither.

Sunday, April 1, 2012

We Really Have To Get Serious About Healthcare Costs....And Do It Now!!

When you read the column by Steve Lopez from today's Los Angeles Times, remember that the majority of ALL personal bankruptcies in the United States last year were due to medical bills.  And that was true for the year before, the year before that, the year before that..........................................

latimes.com

The bizarre calculus of emergency room charges

Readers share their experiences about the bewildering fees charged by hospitals. Even medical professionals can be baffled by the way costs are determined.

Steve Lopez
8:16 PM PDT, March 31, 2012
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Debbie Cassettari had outpatient foot surgery to remove a bone spur. She arrived at the surgery center at 8 a.m., left at 12:30 p.m., and the bill came to $37,000, not counting doctor fees. In recovery now from sticker shock, she's waiting for her insurance company to do the tango with the clinic and figure out who owes what to whom.

Gary Larson has a $5,000 deductible insurance plan, but has found that his medical bills are cheaper if he claims he's uninsured and pays cash. Using that strategy, an MRI scan of his shoulder cost him $350. His brother-in-law went to a nearby clinic for an MRI scan of his shoulder, was billed $13,000, and had to come up with $2,500.

Kaiser member Robert Merrilees had a colonoscopy at an affiliated surgery center, which charged $7,500. His co-pay was $15, Kaiser picked up $470, the rest of the bill "just went away." Merrillees was left scratching his head over the crazy math in medical billing.

There is lots of head-scratching out there, and stories like these have poured in from across Southern California and beyond since I wrote last week about an 11-year-old girl and her $5,000 trip to an emergency room with a stomachache.

I heard from medical professionals who said fear of lawsuits leads to lots of play-it-safe tests and procedures. And some doctors and nurses argued that emergency rooms have to charge high prices because it's extremely expensive to operate them 24 hours a day.

No doubt. But the larger point in last week's column was that the calculus for medical charges in general is beyond comprehension, with outrageously high fees used as a starting point in a bizarre game of bargaining. Glenn Melnick, who teaches hospital finance at USC, told me it's as crazy as if he asked to buy the TV in my living room, and I gave him a price of $1 million to start the conversation.

This is the kind of insanity that exists when medicine and medical insurance are about private profit rather than public health, when 50 million people are uninsured, when Medicare and Medicaid reimbursements don't always cover true costs and when polarized politics prevent the kind of reasonable discussions that could lead to solutions.

In the case of Ella Moser, her grandfather — a physician and Yale professor who has written about medical overcharging —questioned the procedures that were done and the fees that were charged when she was treated in October at Providence Tarzana Medical Center. You can't talk about rising healthcare costs and healthcare reform, he argued, without making both of those elements part of the discussion.

Ella's father, John Moser, had a $5,000 deductible plan with Cigna, and had taken Ella to the hospital to rule out appendicitis. Nothing serious was diagnosed, and Ella went home to a quick recovery. Her dad got a bill for nearly $5,000 from the hospital, as well as bills for $540 from a pathologist and $309 from the doctor who treated her.

Like Moser, lots of patients are surprised to get separate bills like that, unaware that a hospital's doctors can be independent contractors. It's like going to a Laker game, paying $150 for a ticket, and later getting an additional $75 bill in the mail from Kobe Bryant.

Because of Moser's deductible, Cigna paid no part of his bill. But the company's contract with the hospital includes agreed-upon discounts, and those were passed on to Moser.

Just entering the emergency room had been billed at $1,288, for instance, but Moser paid Cigna's negotiated rate of $682.64. The total charges, nearly $6,000, ended up costing him closer to $3,000.

But like his father, the doctor, Moser was left with lots of questions. How can you trust a business that bills you $1,288 but is happy to collect $682.64? Is the second number also arbitrary and perhaps artificially high? Hospitals argue that list prices are high to compensate for patients who don't pay, but how can any patient on that spectrum know whether he's getting a break or being ripped off?

A single-payer system would address some of this nonsense, but forget it. Even President Obama's watered-down healthcare reform act, which may well die on the Supreme Court's operating table, couldn't be passed if it came up for a vote now.

Joseph Mondy, a Cigna spokesman, had some tips for anyone trying to avoid medical bankruptcy from an emergency room visit. Contact your health plan's on-call nurse for advice on whether you need to visit an emergency room, consider a less expensive urgent care clinic if one is available, go to an in-network emergency room if possible and ask the doctor to explain why certain tests and procedures are necessary. Good advice I'm sure, but there's not always time for all that in a genuine emergency.

Dr. Phil Schwarzman, medical director of the emergency department at Providence St. Joseph Medical Center, said 15 million of the nation's uninsured people live in California, and he sees lots of them. From his front-line perspective, he finds it unconscionable that so many Americans have been driven into bankruptcy from medical costs, and he thinks mandated healthcare for everyone would restore some sanity to pricing.

And he speaks not just as a physician, but as a consumer.

Schwarzman has an insurance plan with a high deductible ($7,000). Like Gary Larson (the guy at the top of this column), Schwarzman also paid about $350 for a scan on himself that would have cost much more if he went with his insurance company's negotiated rate. A couple of years ago, his daughter needed an ultrasound for a possible gallstone. If he'd gone through his insurance company, he would have been charged $3,200, with insurance paying $1,500, leaving him a $1,700 bill. He chose instead to leave insurance out of the equation and pay cash instead. The price was $250.

"It's outrageous," Schwarzman said. "I don't know where they're coming up with these numbers. Are they picking them out of a hat?"

steve.lopez@latimes.com