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U.S. "Medicare For All" Is Just A Matter of Time

Enthusiasm for “Medicare for All” healthcare is suddenly sweeping through the American political landscape, which means the lack of universal care (something that has long made the US an outlier among wealthy nations) may be ending.

Healthcare is a matter of right in every other wealthy industrialized nation, although guaranteed and administered in different ways.

In Germany, the state sets prices with heavily regulated private providers for standard treatments and medications and citizens must pay according to their income level, often with state support.

In Canada, each province is the ‘single payer’ of health services, contracting with independent providers, although with laws that discourage or prohibit private health insurance.

In the UK, the National Health Service is fully socialized and its employees are civil servants, a true single payer system. The care provided by these systems is universal, heavily regulated and funded by the state. In all, medical care is far cheaper than in the US.

The US spends more on medical care, per person and as a percentage of gross domestic product, than any other nation: costs are expected to hit 18% of American GDP next year, compared to an Organization for Economic Cooperation and Development (OECD) nation average of around 11%.

Despite this enormous expenditure, roughly 10% of American adults have no health insurance and millions more are underinsured, with medical debt the leading cause of personal bankruptcy. Nor is American healthcare yielding especially impressive results on a national scale, with life expectancy and infant mortality rates markedly worse than in peer developed nations.

Given the high cost in the US, it is no surprise that politicians and pundits have viewed universal healthcare as something the country cannot afford, an inefficient government takeover that would result in higher taxes, lower standards of care and worsening costs.

That the evidence from every other industrialized nation with universal care belies this has made little impact.

Only 36% of Americans hold valid passports, and relate no more to the example of Danish healthcare than they would to reports of bacterial life on Mars. Yet the idea is suddenly catching on.

Obamacare and its discontents

“Socializing” all healthcare was not part of the official debate on Obama’s Affordable Care Act of 2010 (Obamacare), his signature domestic legislation that reformed private health insurance markets, extended coverage to the previously uninsured without universalizing it, and left the system more deeply entrenched.

Yet the leading legislative reaction to Obamacare is not expansion but destruction.

The Republican Party, with control of the executive branch and both branches of the federal legislature, is developing a massive tax cut for the wealthy, paid for by revoking healthcare coverage and heavily cutting Medicaid, the federal program for the poor.

According to the Congressional Budget Office, a federal body that runs cost-benefit analysis on proposed legislation, the version of the American Health Care Act 2017 (AHCA) would immediately strip 14 million Americans of their health insurance, and by 2026, 26 million would be without coverage.

The sudden prospect of millions losing medical coverage has energized citizens - who have packed local town hall meetings with their elected members of Congress, and have been raucous, even confrontational, about healthcare.

This popular response to Obamacare’s potential destruction has gone far beyond defense of the status quo and become radical by American standards, with demands for government-run universal healthcare, often called single payer but increasingly known as Medicare For All.

“Single payer” has become the most important policy issue because people have a dramatic fear of losing their healthcare.

A bill to establish single payer - the Expanded and Improved Medicare for All Act, HR 676 - is floating around the House of Representatives though it is far from summoning a majority.

New chapters of Physicians for a National Health Program are springing up; and that group’s detailed proposals are being published in prestigious medical journals, while more physicians, fed up with fighting insurance companies to get reimbursed, are turning to single payer.

Although universalizing healthcare is a matter of fairness and social justice, it is also, counter-intuitively, the only proven way to control healthcare costs. Savvy plutocrats, such as Berkshire Hathaway investment gurus Warren Buffett and Charlie Munger, have come to support state-run universal care, given that soaring healthcare costs drag down the competitiveness of American firms.

Tame costs by expanding coverage

The chief savings are in reducing the administrative costs of private insurers, which add no medical value.

A June 2016 study in the American Journal of Public Health by Adam Gaffney, Steffie Woolhandler, Marcia Angell and David U Himmelstein, all members of Physicians for a National Health Program, estimates that $500 Billion a year would be saved by this market restructuring.

Independently, the US government could follow multi-payer systems like Germany and flex its buying power to negotiate down prices of healthcare procedures, prescription drugs and medical technology, given that with Medicare and Medicaid it is overwhelmingly the largest purchaser.

Intellectual property law, properly revised, could also push down prices by limiting patents on medicines (often partly developed with publicly funded research) and allowing low-cost generic equivalents to enter the market more quickly.

Big Pharma’s profit margins are enormous, roughly twice the Fortune 500 average - evidence of cartel like privileges at the expense of patients.

Development of new drugs should ultimately pass out of the private sector with its inefficiencies and profit-seeking conflicts of interest.

As economist Dean Baker has proposed, a state-managed research institute could easily develop new drugs and sell them at cost with enormous savings: contrary to capitalist folklore, many of the 20th century’s important breakthroughs, from penicillin to the polio vaccine, were developed by state and non-profit academic researchers.

Political barriers

The barriers to socializing medicine in the US are more political than economic, and are considerable.

Many Republican elected officials have spoken out against the idea of health insurance as collectivist and morally wrong. Republican Scott Perry of Pennsylvania has declared that he shouldn’t be asked to pay towards maternity care since his family does not plan on any more children, while Republican Mo Brooks of Alabama has said he would make the AHCA require the sick to pay more than the healthy ‘who lead good lives’.

Despite such market Calvinism, it’s not clear how deep or enduring is this opposition to “Medicare For all” among Republican voters. In the early 1960s, Republicans and most of the medical profession militantly opposed Medicare (the American Medical Association hired Ronald Reagan to denounce the program as “communism” in radio advertisements), before the program was signed into law in 1965.

Now Medicare is very popular across the political spectrum and politically impregnable. And with both parties realigning their social bases, all bets are off.

The first step will be convincing enough Democrats, itself no easy task. While Bernie Sanders campaigned on single-payer healthcare, his victorious rival Hillary Clinton condemned it as ‘utopian’, an odd choice of words for a system that works smoothly in most other developed nations.

The close ties between donors and lobbyists from the biomedical industry and the Democratic Party can be seen in the family of Senator Joe Manchin of West Virginia and his daughter Heather Bresch, CEO of Mylan, a firm which has jacked up the price of its EpiPen (an emergency device for allergic reactions) from $100 to $600 since 2009. Manchin, of course, defended his daughter’s decision.

But even if Washington Democrats remain opposed to universal care, activity at the state level is going ahead.

For now, the big battleground for universal healthcare is California, where the upper legislative chamber on 1 June passed a non-committal Senate bill (562) calling for a single-payer state system without a specific plan to fund it.

This is the result of much activist prodding: at the state’s most recent Democratic Party convention, members of National Nurses United chanted outside the event. Although the bill was just killed off by the Democratic state assembly speaker Anthony Rendon, it had support from both lieutenant governor Gavin Newsom, likely the state’s next governor, state attorney general Xavier Becerra and many other elected officials.

Is California’s single-payer plan financially feasible in the near term? The program’s cost is estimated at $400bn, only half of which could be covered by the state’s general fund without raising the additional revenue necessary until money-saving reforms can be passed at state and federal level.

Advocates are optimistic. California is the sixth-largest economy in the world and passing single payer there will have a large ripple effect. Like most US progressive efforts, California will lead the US in joining the rest of the industrialized world in providing healthcare for its people.

California’s path to single payer will not be smooth. Even if such a measure eventually does get signed into law and state funds are found, ObamaCare legislation requires the federal government to grant a waiver for any state to set up its own publicly funded system.

Conservative commitments to federalism aside, it is far from certain that the ultraconservative director of the federal Department of Health and Human Services, former Georgia Republican congressman Tom Price, would give California a waiver.

No one expects “socialized” medicine to happen all at once and without political resistance at every level of government. But even if it takes several election cycles, what was recently a dream is suddenly a defining issue in US domestic politics, and sooner or later will be legislated into reality.

Chase Madar, Le Monde (English edition), July, 2017

 

The Electric Car Revolution is Accelerating

Electric cars will outsell fossil-fuel powered vehicles within two decades as battery prices plunge, turning the global auto industry upside down and signaling economic turmoil for oil-exporting countries, according to an important Bloomberg New Energy Finance (BNEF) study.

The BNEF forecast says adoption of emission-free vehicles will happen more quickly than previously estimated because the cost of building electric cars is falling so fast. The seismic shift from dirty energy to clean energy will see cars with advanced plug-in capability account for a third of the global auto fleet by 2040, displacing about 8 million barrels a day of oil production—more than the 7 million barrels Saudi Arabia exports today. 

“This is free market economics, pure and simple economics,” BNEF’s lead advanced-transportation analyst Colin McKerracher said before forecasts were published on Thursday, July 6, 2017. “Lithium-ion battery prices are going to come down sooner and faster than most other people expect.”

The forecast is BNEF’s most bullish to date and is more aggressive than projections made by the International Energy Agency. Surging investment in lithium-ion batteries, more sophisticated manufacturing capacity at companies including Tesla Inc. and Nissan Motor Co., as well as emerging consumer demand from China to Europe support the BNEF’s projections, which also include:

1) In just eight years, electric cars will be as cheap as gasoline vehicles, pushing the global fleet to 530 million vehicles by 2040

2) Electricity consumption from EVs will grow to 1,800 terawatt-hours in 2040, or 5 percent of global power demand, from 6 terawatt-hours in 2016

3) There's around 90 gigawatt hours of EV lithium-ion battery manufacturing capacity online now, and this is set to rise to 270 gigawatt hours by 2021.

However, charging infrastructure on the road will continue to be an issue with distribution bottlenecks capping growth in key Chinese, U.S. and European markets - emerging in the mid-2030s.

Lithium-ion cell costs have already fallen by 73 percent since 2010 and BNEF predicts innovation of battery manufacturers will accelerate and lead to further steep declines in average prices over the next two decades. While they won’t fall as fast as solar panels, it could still lead to suppliers getting squeezed as they compete for contracts, McKerracher said. “There’s an element of competitive dynamics and a real possibility of oversupply in the lithium ion battery market that will serve to hammer down prices,” he said.

The world will need the equivalent of 35 of the so-called Gigafactories like the one built by Tesla founder Elon Musk in Nevada over the next 13 years to meet the power demands of electric cars, according to BNEF. The global shift toward electric vehicles will create upheaval for the auto industry.

Moreover, the oil industry majors will be harmed by reduced gasoline demand, as well as spark plug and fuel injection manufacturers whose products aren’t needed by plug-in cars. BNEF, which last year forecast as much as 13 million barrels of oil a day was being displaced by electric cars, said its revised 8 million barrel a day figure is “likely understated. ”While traditional car suppliers may be hurt by EV growth, some commodities will get a lift, according to BNEF:

    1. Graphite demand will soar to 852,000 tons a year in 2030 from just 13,000 tons in 2015

    2. Nickel and aluminum demand will see demand rise to 327,000 tons a year from 5,000 tons now

    3. Production of lithium, cobalt and manganese will each increase more than 100-fold

It’s the world’s biggest economies—China, the U.S. and Europe—that will drive demand for battery powered cars over the next 25 years, according to BNEF. These governments which have already been the most advanced in providing subsidies and installing charging points, will reap the benefits sooner than other emerging economies like India. "Electric cars are intrinsically cheaper than gas or oil fuelled cars because they're simpler and their maintenance is a lot easier,” said Enel SpA Chief Executive Officer Francesco Starace said in an interview in Rome. In Europe, almost 67 percent of new cars sold will be electrified in 2040, and 58 percent of sales in the U.S. and 51 percent in China, BNEF said.

Unfortunately, there's some uncertainty in the U.S., where the backwards thinking Donald Trump could disrupt electric vehicle growth by withdrawing support for this essential smart technology in the world’s second biggest car market.

“The next 6 to 8 years become very important,” McKerracher said. “If those volume amounts falter, then some of those cost reductions may not come to pass and that will affect the crossover point and therefore the overall adoption level.”

Jess Shackleman, Bloomberg News, July 7, 2017 

Donald Trump's Triumph of Ignorance

Until the very end, they tried behind closed doors to get him to change his mind about leaving the Paris Climate Accord. For the umpteenth time, they presented all the arguments -- the humanitarian ones, the geopolitical ones and, of course, the economic ones. They listed the advantages for the economy and for American companies. They explained how limited the hardships would be.

German Chancellor Angela Merkel was the last one to speak, according to the secret minutes taken last Friday afternoon in the conference hotel in the Sicilian town of Taormina - meeting notes that DER SPIEGEL has been given access to. Leaders of the world's seven most powerful economies were gathered around the table and the issues under discussion were the global economy and sustainable development.

The newly elected French president, Emmanuel Macron, went first. It makes sense that the Frenchman would defend the international treaty that bears the name of France's capital: The Paris Agreement. "Climate change is real and it affects the poorest countries," Macron said.

Then, Canadian Prime Minister Justin Trudeau reminded the U.S. president how successful the fight against the ozone hole had been and how it had been possible to convince industry leaders to reduce emissions of the harmful gas.

The New Leader of the Free World Speaks

Finally, it was Angela Merkel's turn. Renewable energies, said the chancellor, present significant economic opportunities. "If the world's largest economic power were to pull out, the field would be left to the Chinese," she warned. Xi Jinping is clever, she added, and would take advantage of the vacuum it created. Even the Saudis were preparing for the post-oil era, she continued, and saving energy is also a worthwhile goal for the economy for many other reasons, not just because of climate change.

But Donald Trump remained unconvinced. In fact, he had already made up his mind. No matter how factual the arguments presented by the increasingly frustrated group of world leaders, none of them had an effect. "For me," the U.S. president said, "it's easier to stay in than step out." Based on ideology and not facts, Trump says that environmental constraints were costing the American economy jobs, he said. And that was the only thing that mattered. Jobs, jobs, jobs.

At that point, it was clear to the rest of those seated around the table that they had lost him - or never really had his ear. Resigned, Macron admitted defeat. "Now China leads," he said.

The Fool in the Rose Garden

Still, it is likely that none of the G-7 heads of state and government expected the primitive brutality Trump would stoop to when announcing his withdrawal from the international community. Surrounded by patronizing sycophants in the Rose Garden at the White House, he didn't just proclaim his withdrawal from the climate agreement, he sowed the seeds of international conflict. His speech was a break from centuries of Enlightenment and rationality. The president presented his political statement as a nationalist manifesto of the most imbecilic variety. It couldn't have been any worse.

Moreover, Trump's speech was packed with lies and bogus numbers from controversial or disproven studies. It was hypocritical and dishonest. In Trump's mind, the climate agreement is an instrument allowing other countries to enrich themselves at the expense of the United States. "I was elected to represent the citizens of Pittsburgh, not Paris," he said.

Trump left no doubt that the minority base that elected him was the only value he is capable of understanding. Ever the paranoid narcissist, Trump state that "it's no wonder that the other countries applauded when Washington signed the Paris Agreement," he said. "We don't want other leaders and other countries laughing at us anymore. And they won't be. They won't be."

A "Yuge" Step Back for the Earth's Climate and Diplomacy

Trump's withdrawal is a major setback for the climate, our children and grandchildren. The U.S. is the second-largest emitter of greenhouse gases -- behind China -- and is now no longer part of a responsible global effort to put a stop to scientifically factual climate change. It's become America against the rest of the world, along with Syria and Nicaragua (the latter didn't sign on because the Pact wasn't stringent enough), the only other countries that haven't signed the Paris deal.

But the negative effects on the geopolitical climate are likely to be just as huge. Trump's speech provided only the most recent proof that discord between the U.S. and Europe is deeper now than at any time since the end of World War II.

Today, the Western community of values is standing in opposition to Donald Trump. The G-7 has become the G-6. The West is now divided. As long as Trump and his Republican Party "ignorance caucus" remains in power, China is now set to become the new world leader and continental Europe will be the new global leadership of the free world.

For three-quarters of a century, the U.S. led, protected and cooperated economically with Europe. Despite all the mistakes and shortcomings exhibited by U.S. foreign policy, from Vietnam to Iraq, America's claim to both political and business leadership of the free world was never seriously questioned. Until now.

Donald Trump is in the process of destroying the remaining goodwill that exists. And yes, the world leaders were never laughing at America. But they are laughing now at the political and economic ignorance that is Donald Trump.

Der Spiegel Online, June 2, 2017

California's Economy Trumps Trump's Economy

California's economy is the antithesis of Donald Trump's vision of the US economy.

And the economy of California is the chief reason America is the only developed economy to achieve record GDP growth since the financial crisis of 2008 and ensuing global recession, according to data compiled by Bloomberg.

In fact, much of U.S. economic growth can be traced to California laws promoting clean energy, government accountability and protections for undocumented people. Governor Jerry Brown, now in his fourth term, considers immigrants a major reason for the state's success: "39 percent of us are Latino and the majority are from Mexico," he said in March in his Sacramento office.

In the stock and bond markets, where investors show no allegiance to political parties, California has outperformed the rest of the U.S. the past five years, especially since the Nov. 9 election, when Trump became the fifth person to win the Electoral College and lose the popular vote.

California's creditworthiness keeps getting better, measured by the declining cost global investors must pay to ensure against depreciation of the state's debt obligations. That premium has diminished more than any other state since 2012, according to data compiled by Bloomberg.

California, whose voters favored Hillary Clinton two to one, outperformed Treasury bonds since the November election. Texas, which is the second-largest state in population and which supported Trump, lost ground compared to Treasuries and California in the market for state and local debt since the November election. Investors see better security in the state with more regulations that protect investors and more support for immigrants.

California's borrowing cost is 0.15 percentage points lower than the average for states and municipalities and has declined to just 0.24 percentage points more than the U.S. pays on its debt, down from 1.97 percentage points in 2013.

At the same time, bonds sold by California's municipalities produced a total return of 2.3 percent since November, outperforming the benchmark for the general U.S., according to data compiled by Bloomberg. The growing popularity of bonds sold by California issuers is a consequence of the state's more rigorous regulation of the bond market, specifically legislation signed by Brown last year, creating greater transparency and accountability for issuers of California debt.

The Clean Energy Economy

Moreover, no state in the US or no country in the world has created as many laws discouraging fossil fuels and carbon pollution while promoting clean energy. That convergence of policy and voter preference is clearly paying off in the stock prices of companies domiciled in California.

California is also home to 20 of the 130 companies in North America and South America that meet the standard classification of clean energy. These 20 companies produced a total return of 40 percent during the past 12 months, beating the clean energy benchmark's 13 percent, the S&P 500's 19 percent and the S&P 500 Energy Index's 6 percent.

California clean energy companies reported annual revenue growth of 26 percent, almost three times the benchmark, and they turned more revenue into profit with an average gross margin of 46 percent, compared to 41 percent for the benchmark. California companies also spent 13 percent of their revenue on research and development compared to 8 percent for the benchmark.

Jobs at clean energy companies in California increased 14 percent last year, double the average rate for the industry. Analysts surveyed by Bloomberg say these 20 stocks will gain only 1 percent during the next 12 months, because they achieved their target valuations much sooner than predicted. Tesla Inc., the Palo Alto-based manufacturer of electric vehicles, appreciated 60 percent since Trump's election and is now worth more than $50 billion, greater than Ford Motor Co.'s $45 billion market capitalization and almost as much as General Motors Co.

"We have a goal of a million and a half electric vehicles by 2025 and that's quite a steep curve to get there," Brown said in the interview in March. "No matter what Trump says, China, the world, the academies of science and all the major countries have all recognized climate change. Certainly, businesses acknowledge they have to make these investments. California is well on its way."

Technology driving the clean energy boom is the reason California companies lead most of their peers in U.S. The 467 California-based firms in the Russell 3000 Index produced a total return of 185 percent since 2012, easily surpassing the 94 percent for the index, according to data compiled by Bloomberg. Analysts also are more bullish on companies in California than the rest of the U.S., predicting a 12-month average total return 12 percent (income plus appreciation) versus 9 percent, according to data compiled by Bloomberg.

Behind such a favorable outlook is the diversity of the California economy, which grew $42.3 billion during the first three quarters last year. That's almost as much as the next two fastest-growing states, New York and Florida, combined.

California's revenue from agriculture, forestry, fishing and hunting totaled $39 billion in 2015, plus $279 billion from manufacturing. The trailing 12-month revenue from California technology companies is $720 billion, or 54 percent of the U.S. industry, according to data compiled by Bloomberg.

The capitalist juggernaut that is California helps explain why the state's per capita income increased 9.5 percent since 2015, the most of any state and the most since 2012, according to data compiled by Bloomberg. Far from losing jobs overseas, California keeps creating them with an unemployment rate declining to 4.9 percent from 5.7 percent in 2016, faster than the national average.

None of this is lost on the residents of California.

They are proudly enacting policies in opposition to Trump's economic mindset. The California legislature became the first to vote to become a sanctuary state, and supported raising gas taxes and vehicle registration fees to improve infrastructure. While Trump gets the lowest approval of any new president after 100 days and the Republican Congress does worse, the politics of California are the opposite. A recent University of California Institute of Government Studies poll found 57 percent of California's registered voters approve of the legislature's job performance. Governor Jerry Brown gets 61 percent approval.

If that's an economic "mess," as Donald Trump declared about "liberal" economies during his first week in the White House, we all could only hope for more of California's multicultural green energy economy in many more states nationwide.

Mathew Winkler, Bloomberg View, May 10, 2017 

The Mean-Spirited Governance of the Republican Party

Why are so many House Republican politicians willing to throw over 25 million struggling Americans off the health insurance rolls? Will the Senate Republicans act in such a mean-spirited way?

Why does the so-called populist Trump administration submit a budget that slashes job training programs for the very same jobless white folks he claimed to represent - who probably voted for him?

Why cut Meals on Wheels, child care, after-school programs and learning centers for the poor, affordable housing and aid to the homeless?

Why “zero out” occupational safety training and economic growth assistance in distressed communities in Appalachia and the Mississippi Delta (more Trump constituents)?

Why slash legal aid and medicine and food for the sick and hungry in the developing world, among many others?

Why implement the above budget cuts, and then propose to increase the US military budget by 10%, a budget that is already twenty times larger than any other country on Earth? 

Don't Ask Why, Only How!

To save our democracy for a right wing nationalism that is bordering on fascism, journalists must aggressively ask Republican leaders about their policies, mechanisms and money. But those are technical questions, when the real and simple question they should be asking is a moral one: Why do Republicans seem intent on hurting the most vulnerable among us?

Unfortunately, the answer may just be, to paraphrase Clint Eastwood’s Dirty Harry on why serial killers murder: they like it.

Sure, we know the rote ideological answers. Republicans love to talk about “choice” and “freedom” and “markets” and “deficit reduction” and “personal responsibility” and all sorts of ideological claptrap that seems to slap the concept of principle on what really is punishment.

At best these are smokescreens, at worst traps that have succeeded in entangling the corporate media, drama queen Democrats and naive Americans in arguments about tactics or priorities - rather than arguments about motives and their real-life consequences.

There once was a time when Republicans worried they might be perceived as being on the wrong side of morality, even if that worry didn’t move them to get on the right side. They used to dress up their cruelty not only in those old Milton Friedman free market clichés but in new ones like “compassionate conservatism,” because even as they knew there was nothing compassionate about it, they also knew that most Americans weren’t buying into letting the poor totally  fend for themselves. That wasn’t American. That was inhumane.

Some of that window dressing remains in the Trump era, but not very much. During its negotiations, Republicans felt obliged to misrepresent that their health care plan would cover more Americans at a lower cost - but everyone knew they were lying. By one report, when the White House ran the numbers, it predicted 26 million would lose health coverage - 2 million more than the Congressional Budget Office figure.

Speaker of the House Paul Ryan was more than gleeful about those who would suffer. He flashed a vulpine smile in recounting the CBO numbers, actually saying they were better than he had thought, which is to say that the American Health Care Act, as they called it, would have been intended to deny coverage, just as Trump’s budget clearly was intended to hurt the most vulnerable, including his now vulnerable supporters. These callous comments weren’t collateral effects. They were the very reasons for the now failed health care plan and the budget.

What kind of political leaders are dedicated to inflicting pain on others?

Since millions of Americans will be hurt from both a Republican health care plan and Trump's budget, when does it finally violate most precepts of basic decency? Well, it probably comes from a meld of Calvinism with social Darwinism. From Calvinism, Republican politicians seem to have borrowed both a pinched and unsparing view of humanity as well as the idea of “election” — namely, that God “elects” some folks for redemption, which, when rebooted with modern evangelical conservatism, has a clear unforgiving economic component.

In Republican Party speak, plain and simple, rich people are rich because they are better than poor people.

By the same token, poor people are poor because they are "cursed." This seems to be a sort of Republican Party edict, so to speak. From social Darwinism, Republicans borrowed the idea that this is the way the world should be: winners and losers - those who can succeed and those who can’t (or won’t). It is a world without luck, except for tough luck.

From this perspective, Republican politicians may not actually think they are harming the vulnerable - but instead harming the "undeserving," which in their view is very different.

In effect, Republican politicians believe they are only meting out life's divine and natural justice, American style. It’s convenient, of course, that this justice turns out to also be economic redistribution, except here it's taking resources from the poor and middle class and funneling them to the wealthy. But in reverse, notice how Republican leaders quickly howl about redistribution when the rich are asked to fund programs for the poor!

Where many of us see need, Republican politicians see indolence and impotence. It is, by almost any gauge, not only self-serving but also wrong — moralistic rather than moral.

But if Republican politicians see their moral duty as denying help to the weak, that denial is part of a larger and even uglier social equation: to give anything to the less fortunate is to subtract it from the Republican Party vision of itself - a zero-sum game between the rich and "blessed Americans" - and the rest of America.

This isn’t about governing or politics. This is bedrock Republican Party philosophy. And it may have no more eager avatar than Donald Trump, who is all about winning and losing.

Trump has always professed an elitist billionaire form of anarchy - wanting to blow up the welfare state of the great unwashed. He is like a child knocking down a tower of blocks, only in his case the blocks are American compassion and social assistance.

As we saw with the latest Republican health care plan - and now Trump's Draconian budget, one that even a few Republicans (fearing voter retribution) blanched at, Trump may not have blown up the system so much as he has blown the Republicans’ political cover. In fact, Trump has even emboldened the most callous of Republicans – the House Freedom Caucus - to come out of hiding and admit that any health care assistance for satan's poor is simply too much.

What is harder to parse is the joy Republican leadership seems to get in hurting the weak, making the GOP the punishment party. Or put in different terms: Republicans didn’t create meanness, but meanness sure created the new Republican Party.

We might be able to understand that sense of moral and social superiority from doctrinaire Republican politicians who spout Ayn Rand and detest those whose hurdles are the highest. We all know hate can be intoxicating.

But these past weeks Ryan and Trump have been gambling on something else — that many of their fellow Americans agree with them, that these Americans share a deep and abiding hostility to those who need government assistance. Whether Ryan and Trump are "right" may very well determine the fate of this country.

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What about Republican Voters?

So the second big question, alongside why Republican polticians seem to luxuriate in their political form of cruelty, is why any other ordinary American would allow it.

There have been predictions that once those ordinary Americans feel the sting of losing health care or job training or work safety regulations or clean water and air, they will revolt, and Trump will be dust.

Although this will happen to some Americans eventually, there is no certainty to a populist revolt. A recent New York Times piece on this very issue indicated that at least some Trump supporters know they will suffer from his budget - and will still support him.

Another Times article, by Eduardo Porter, quoted a Harvard economist suggesting that the white working class feel they get so little benefit from the so-called neoliberal welfare state that they see things through the same zero-sum prism as Ryan and Trump. In other words, if the poor gain at all, the white working class loses.

Is Government bad, or is who runs government bad?

When you think how much the government does for so many Americans across such a wide spectrum, you wonder what world these people are living in. Indeed, a signal achievement of neoRepublicanism, decades in the making, has been pitting the “have littles” against the “have nots” while the “have lots” stayed above the fray, getting ever more tax cuts. 

Of course, by that calculation, you might think the struggling white working class would be on the losing side of the ledger, sentenced to defeat by their own deficiencies in our Darwinist world.

But in another neat political trick, Republican politicians have managed to convince their constituents they are victims of twin demonic forces - government and liberal elites. Combined, these two devil worshiping entities disrupt the natural order of things. In this way, the Republican Party helped turn many Americans into citizen brutes and our American community into a state of dog eat dog nature. There couldn’t have been a President Trump without it. There couldn’t have been an inhumane Republican health care plan or a Trump budget either.

This is a vital moment for American civility, morality and compassion, and to the extent the two are intertwined, American democracy and capitalism.

Neil Gabler, Moyers and Company, March 22, 2017

The Donald Trump Presidency: A step backwards - or a leap forward?

The new Donald Trump administration and the re-energized Republican Congress is looking like more of the same free markets fundamentalism that makes the rich richer and the middle class and poor poorer. If so, eventually these economic policies will fail, just as we saw after eight years of the George W. Bush administration.

Yet from a professional money management standpoint, in the short-term Wall Street and the stock market loves this type of economic steroidization. Of course it may take a few months or years, but eventually the extreme income inequality that is usually created by these economic policies will rear its ugly head - including the inevitable stock market bubble such policies foster. 

Sure, we will take advantage of a rising stock market while we can, as that is our job as investment managers. But have no illusions as to the long run economic risks to average American workers and the US economy.

More "Trickle Up" Tax Policies

Typically, Trump says he is going to slash personal and corporate taxes in order to put more money into the economy to increase business investment, boost hiring, and rev up growth. Regrettably, as history clearly shows, his type of tax plan achieves none of these. Slashing taxes for the wealthy does not boost growth. We know that it doesn’t work. Voters, unfortunately, have savior amnesia every eight years.  

Trump’s tax plan, which has been the uber-elite economic ideology of the modern Republican Party since the presidency of Saint Reagan, will certainly push up the stock market while simultaneously increase income inequality even more. 

However, the Trump plan will most likely do little for the main street US economy, for our growing budget deficits, and for the same working people who voted for Mr. Trump. If that were not true, we would not be witnessing an early effort to compensate for the expected loss of tax revenues under the Trump tax plan by the Republican Congress: They now feel like they have the perfect excuse to implement more aggressive “privatization” attacks on Social Security and Medicare.

Retiring and retired Americans should be very afraid of this kleptocratic economic ideology we are seeing now from the emboldened but arrogantly cavalier Congressional Republicans.

Moreover, the huge tax break Trump intends to award to the tax dodging corporations that stash their money overseas will not be used to fire up growth or invest in future business ventures. Instead the money will once again be used to issue more dividends to shareholders or increase stock buybacks that pump up stock prices. This is the same outcome we saw with the massive interest free bailouts under Barack Obama.

Deep down Trump and his economic advisors must know his so called “corporate tax holiday” is a bunch of baloney. Experienced investors easily understand that companies are not going to expand their operations, hire more workers, and create more product when consumer demand is still in the outhouse over seven years after the Great Recession. 

Instead, they’re going to do exactly what their shareholders expect them to do, pursue those areas of investment that promise the best possible return. In this case that means the same financial engineering tactics they have been using for the last eight years that will eventually create another stock market bubble.

Trump’s promise to bring jobs back to the U.S.

Back in the ’30s, we had massive public works spending and government spending, so we created the construction worker class. But on that front, we’re simply not going to compete anymore, as the Carrier CEO said recently. Mexican labor is $3 an hour. No amount of retraining for lower-skilled assembly jobs in the US is going to change that. The only thing that will replace that Mexican worker is a robot. And a robot is infinitely cheaper than even the cheapest American worker.

That’s where the resentment and discontent with Trump and the Republicans will come — when you’ve once again sold that dream and it doesn’t happen. In that scenario, Trump and the Republicans will have a pretty short honeymoon. But that won't matter to the Trump cabals. By that time they will have skimmed their premium milk from the government tax cow way before the economy falls apart under its own jubilent bubble.  

China & Mexico - the bogeymen

China is increasingly a geostrategic rival. In the past, China looked toward protecting its own region, making claims on Taiwan and Tibet and ancillary areas. So the Chinese were really content not to compete in the global Cold War between the Soviet Union and the United States. Now we have this new multi-polar world, and China sees itself clearly as the prime actor in the Pacific, Africa, and southern Europe - willing to fill any vacuum that the United States and northern Europe pulls away from.

Trump, however, has decided that China and Mexico makes two convenient media punching bags. He claims that China and Mexico took our jobs. Hogwash! In fact, China and Mexico did not take our jobs. US corporations gave them our jobs - to increase company profits and push up their stock prices. However, the broader issue will be that foreign policy and national security events have a whole different and more complex dynamic than "tweet" beating up on a defense contractor or an air conditioning plant.

Corporate execs in the United States are quietly terrified by Trump's China and Mexico bashing. The business supply chain for U.S. manufacturing relies on parts from Mexico and China coming in. The US is very interconnected. If Trump insitgates a trade war against China and Mexico, lots of businesses, and workers, too, will get disrupted in ways we can’t even imagine. It would be very negative for US economic growth.

Watch out from above, it can be a long way down!

Trickle Down Economics: The Art of the Steal

Trickle Down Economics is possibly our Nation's biggest political scam consistently perpetrated on American voters and taxpayers.

Here’s the theory: Cut taxes for big corporations and the rich, in turn, they will take that money and create jobs to stimulate the US economy.

Here’s the reality: The super rich and big business hoards the tax cuts for themselves.

In a testiment to concentrated economic and political power in the US, 90% of tax cuts for the rich are held in passive accounts that have NO effect national job creation or growing the wealth of middle and lower income Americans. In harsher terms, elites seem to only care about the financial health of middle and lower class Americans when they can use or manipulate the latter's anger and votes.

President-elect Donald Trump is a perfect example of the recycled elite "Trickle Down" politician. During his campaign, Trump chastised Hillary Clinton for taking huge amounts of money from Goldman Sachs. Less than a month after winning the Electoral College, Trump appoints an ex-Goldman Sachs executve and housing foreclosure specialist. Then, almost immediately, he appoints a billionaire ex-Goldman Sachs hedge fund crony to the position of US Commerce Secretary.

It looks like the "evil swamp" Trump was campaigning against was drained and he found some of his Cabinet members at the bottom!

History shows during every election cycle how politicians have no qualms about blatantly lying to voters over how much they care about putting money  back in average American’s pockets. These false campaign slogans end up being nothing more than bogus political promises that dupe voters into electing them - and hope that by the next election cycle voters will forgot how they were duped the last time.

Given the current state of the US economy, Trickle Down policies are once again the free market "hope and change" economics. Yet, the national politicians, primarily market fundamentalist ideologues like Paul Ryan (and now Trump), continue to preach this false hope "elite saviour" faith.

We are just now starting to recover from the great recession in 2008 caused by irresponsible deregulation and "Trickle Down" economics, yet here we are at it again with the new Trump version of this failed economic theory. "Insanity" is doing something that doesn't work over and over again expecting a different outcome.

The Kansas Failure

We can see the inherent failings of "Trickle Down" at the state level. in 2010, Kansas elected a Tea Party true believer to be their governor. He promised during his campaign that by slashing taxes for businesses and the State's elites, everyone in Kansas would benefit. After being elected into office and then having a Republican assembly and senate, the Governor signed off on the biggest tax cut in the state’s history.

The result: Ninety percent of those tax cuts in Kansas benefited the top 10 percent of earners: the rich. The Kansas economic experiment failed miserably and since the cuts, Kansas has faced yearly budget deficits and was sued for its lack of funding for public education.

By June of 2014, the results of Brownback’s economic reforms began to come in, and they weren’t pretty. During the first fiscal year that his plan was in operation, which ended in June, the tax cuts had produced a staggering loss in revenue—$687.9 million, or 10.84 percent.

According to the nonpartisan Kansas Legislative Research Department, the state now risks running deficits through fiscal year 2019. Moody’s downgraded the state’s credit rating from AA1 to AA2; Standard & Poor’s followed suit, which will increase the state’s borrowing costs and further enlarge its deficit.

Yet in spite of the massive negative evidence, Now Donald Trump wants to double down on "Trickle Down" nationally, an economic policy that primarily benefits the major benefactors of the elite ownership of wealth and power.

Markets

Viewing the proposed Trump economic plan objectively, it does look like we are experiencing a Trump honeymoon stock market rally - for a few months - mainly because of "business friendly" domestic banking and fossil fuel deregulation proposals. Over time, once the protectionist Trump Administration economic policies get fully implemented, only then will we see the real positive or negative effects of the "Trumpnomics" version of the "Trickle Down" philosophy on the US and global economies.

Rocky Boschert

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