Obamacare

Working 60 Hours A Week At 3 Part-Time Jobs And Still Living Paycheck To Paycheck

Woman Face Skyline - Public DomainWhat can you do when you are working 60 hours a week at three part-time jobs and it is still not enough?  In America today, many people have taken on more than one job in a desperate attempt to make ends meet, but they still come up short at the end of the month.  And those that are actually working are the fortunate ones, because in one out of every five families in the United States nobody has a job.  There are more than 100 million working age Americans that are currently not employed (yes this is true), and as I pointed out yesterday, job cut announcements by major firms are currently running 24 percent ahead of last year’s pace.  But unemployment is just part of the overall problem.  There is this growing misconception out there that if you “have a job” that you must be doing okay.  Unfortunately for the growing number of “working poor” in America, that is not true at all.

Just consider the case of 55-year-old Erlinda Delacruz.  At one time she had a good full-time manufacturing job, but then her factory closed down.  Millions of other Americans have also seen their good paying jobs sent out of the country in recent years, and yet our politicians refuse to do anything about it.  Today, she works 60 hours a week at three different part-time jobs and she still makes less than she once did at the manufacturing plant…

For 15 years, Erlinda Delacruz had a full-time manufacturing job in rural Winters, Texas.

It gave her health benefits and four weeks of paid vacation along with a salary that supported a good life. Then the rug was pulled from under her in 2009, when the plant closed. Since then, it’s been a battle of survival as Delacruz worked a string of part-time jobs. Last summer, she even lost her home to foreclosure.

Delacruz, 55, still works part-time. Except at three different places — Monday through Wednesday she works eight hours a day at a senior citizens center serving meals, and Thursday through Sunday Delacruz divides her time between two other jobs as a cashier at Walmart (WMT) and the Wes-T-Go convenience store.

She told CNN that she lives paycheck to paycheck”, and just like half the country, she is basically flat broke at this point.

Barack Obama promised to be the hero of the working class when he was elected, but it seems like almost everything that he has done has hurt the working class even more.

Take Obamacare for example.  Health insurance premiums have soared through the roof since Obamacare was implemented, and many struggling families now find that they can no longer afford health insurance at all.

And many of those that have signed up for Obamacare are often discovering that many doctors and hospitals won’t even accept their coverage.  The following comes from the New York Times…

AMY MOSES and her circle of self-employed small-business owners were supporters of President Obama and the Affordable Care Act. They bought policies on the newly created New York State exchange. But when they called doctors and hospitals in Manhattan to schedule appointments, they were dismayed to be turned away again and again with a common refrain: “We don’t take Obamacare,” the umbrella epithet for the hundreds of plans offered through the president’s signature health legislation.

“Anyone who is on these plans knows it’s a two-tiered system,” said Ms. Moses, describing the emotional sting of those words to a successful entrepreneur.

“Anytime one of us needs a doctor,” she continued, “we send out an alert: ‘Does anyone have anyone on an exchange plan that does mammography or colonoscopy? Who takes our insurance?’ It’s really a problem.”

Unfortunately, things are not going to be getting any better for the working class because we have now entered the early stages of the next major economic downturn.

Earlier today, I received an email from someone that works for a very large company that provides produce for some of the biggest grocery chains in America.  According to him, there has been a dramatic decline in orders coming in recently, and this is something that didn’t even happen during the depths of the last major recession.

So why in the world would that be happening if the economy was in good shape?

I have been receiving similar anecdotal reports from people all over America.  We may not be experiencing a full-blown economic implosion like Venezuela is quite yet, but we are starting to slide in that direction.

And just like in Venezuela and elsewhere around the globe, when economic conditions get harder violent crime goes up.  I have warned that this would happen over and over again, and it is already starting to happen in major cities all over the nation…

According to new reports, 2016 is shaping up to be an even more murderous year than last in over two dozen major U.S. cities as homicides rise at their fastest pace yet.

Chicago, Los Angeles, Dallas and Las Vegas have seen the worst, all of which experienced increased homicides in 2015, evidenced by acceleration of murders in the first three months of 2016.

Law enforcement officials and experts are saying the increase over the last year is due to many factors, including an uptick in gang and drug-related violence. Yet, many believe cops and citizens are now interacting differently since the rise of the Black Lives Matter movement has shifted attitudes to distrust police.

Of course we haven’t even gotten to the bad stuff yet.

What we have seen so far is just the very beginning of the chaos that is coming to America.

Before I go today, I want to mention a couple of things.

First of all, the Dow was down another 180 points today, and someone out there is betting unprecedented amounts of money that a major market crash is imminent.  Just check out this chart.  You buy shares of financial instruments such as UVXY because you think that the market is going to implode.  So if there is a giant market crash in our very near future, whoever purchased all of those shares of UVXY stands to make an enormous amount of money.

Secondly, I really started to sound the alarm about German banking giant Deutsche Bank back in September.  And sure enough – their stock price plunged to an all-time record low earlier this year.

But now the whispers are getting louder that even bigger trouble is ahead for this pillar of the European financial system.  The following originally comes from Berenberg analyst James Chappell…

Too many problems still: The biggest problem is that DBK has too much leverage. On our measures, we believe DBK is still over 40x levered. DBK can either reduce assets or increase capital to rectify this. On the first path, the markets do not exist in the size nor pricing to enable it to follow this route. Going down the second path also seems impossible at the moment, as the profitability of the core business is under pressure. Seeking outside capital is also likely to be difficult as management would likely find it hard to offer any type of return on new capital invested.

Keep a close eye on Deutsche Bank.  They may very well end up providing us with the next “Lehman Brothers moment” that so many people have been waiting for.

There is so much going on “under the surface” right now, and I am convinced that it will not stay “under the surface” for very much longer.

The global financial system is starting to come apart at the seams even as you read this article, and this is going to have enormous implications for every man, woman and child on the planet in the years ahead.

So as bad as things are for the working class in America right now, the truth is that they are about to get a whole lot worse.

23 Percent Of Americans In Their Prime Working Years Are Unemployed

Unemployment - Public DomainDid you know that when you take the number of working age Americans that are officially unemployed (8.2 million) and add that number to the number of working age Americans that are considered to be “not in the labor force” (94.3 million), that gives us a grand total of 102.5 million working age Americans that do not have a job right now?  I have written about this before, but today I want to focus just on Americans that are in their prime working years.  When you look at only Americans that are from age 25 to age 54, 23.2 percent of them are unemployed right now.  The following analysis and chart come from the Weekly Standard…

Here’s a chart showing those in that age group currently employed (95.6 million) and those who aren’t (28.9 million):

Americans In Their Prime Working Years Not Working

“There are 124.5 million Americans in their prime working years (ages 25–54). Nearly one-quarter of this group—28.9 million people, or 23.2 percent of the total—is not currently employed. They either became so discouraged that they left the labor force entirely, or they are in the labor force but unemployed. This group of non-employed individuals is more than 3.5 million larger than before the recession began in 2007,” writes the Republican side of the Senate Budget Committee.

Clearly, we have never recovered from the impact of the last recession.

But let’s try to put these numbers in context.

Below, I would like to share two charts with you.  They show what has happened to the inactivity rates for men and for women in their prime working years in the United States in recent years.

In order to be considered “inactive”, you can’t have a job and you can’t be looking for a job.  So this subset of people is smaller than the group that we were talking about above.  The 23.2 percent of Americans in their prime working years that are unemployed right now includes those that are looking for a job and those that are not looking for a job.

These next two charts do not include anyone that has a job or that is currently looking for a job.  These charts only cover “inactive” people in their prime working years that are not considered to be in the labor force.

As you can see in this first chart, the inactivity rate for men in their prime working years exploded higher during the last recession and then continued to go up even after the recession supposedly ended.  At this point, it is hovering near all-time record highs.  Does this look like an “economic recovery” to you?…

Inactivity Rate Men

For women, we see a similar thing.  In this next chart, you can see that the inactivity rate for women in their prime working years rose during the last recession and then just kept on rising.  At this point, it remains far higher than it was during the last recession…

Inactivity Rate Women

What are we to make of all this?

For both men and women in their prime working years, the inactivity rate is significantly higher than it was during the last recession.

All of these people neither have a job nor are they looking for one.

So what in the world is going on here?

Are they independently wealthy?

Have these people found rich spouses to marry so they don’t have to work?

No, the truth is that the middle class in America is steadily eroding and poverty is absolutely exploding.  Credit card debt has soared to a new record high, and 48 percent of all U.S. adults under the age of 30 believe that “the American Dream is dead”.

The issue isn’t that people don’t want to work.

The issue is that people cannot find enough work.

And even if you have a job, that does not mean that you are on easy street.  According to the Social Security Administration, 51 percent of all American workers make less than $30,000 a year.

Tens of millions of Americans are now among the ranks of “the working poor”.  So many families are watching their expenses soar while their paychecks go down or stagnate.  If you are in this situation right now, then you probably know how exceedingly stressful it can be.

Just look at what is happening to the cost of health insurance.  The following comes from Fox News…

Health insurance premiums have increased faster than wages and inflation in recent years, rising an average of 28 percent from 2009 to 2014 despite the enactment of Obamacare, according to a report from Freedom Partners.

And I am not exactly sure where they got those numbers.  Personally, I know that my health insurance rates have gone up far faster than that.

Two years ago, my health insurance company wanted to double the health insurance premiums for my family even though we never get sick.  So I switched to another insurance company that offered a policy that was only about 30 percent higher than my last one.  But then when it came time to renew, that insurance company wanted to raise my rate by another 50 percent.

Thanks to Obamacare, American families are being absolutely crippled by the cost of health care.  And of course we are seeing the rising cost of living so many other places as well.  Our paychecks are being squeezed harder and harder, and this is absolutely killing the middle class.  In fact, the middle class in America is now a minority for the first time ever.

And now for the real bad news – this is about as good as things are ever going to get in this country.  As you can see from what I have shared above, we never really had any sort of meaningful “economic recovery”, and now we have entered the early phases of the next major downturn.

So where do we go from here?  Unfortunately, our debt-fueled prosperity has provided us with a massively inflated standard of living that is not even close to sustainable.  As this bubble bursts, the economic pain is going to be absolutely unprecedented.

But it won’t be just economic pain that we are facing.  In my new book, I detail the things that I believe that are coming to this country, and I explain why the entire planet will soon be facing incredibly challenging times.  It is going to be one of the most controversial Christian books of 2016, because it directly challenges many of the things that are being taught in mainstream churches today.  My book is an ominous message of warning and an inspiring message of hope, and I truly believe that it is the most important thing that I have ever written.

No matter how you may see the future, the key is that we all learn to love one another.  The years ahead are going to be extremely challenging, and those that want to chase everyone else away and survive as lone wolves are going to have a very rough time.  We all need each other, and those that have friends, family and communities around them are going to be in a much better position to weather the coming storms.

So let us hope for the best, but let us also prepare for the worst…

The Average Age Of A Minimum Wage Worker In America Is 36

Dollar Stacks - Public DomainDid you know that 89 percent of all minimum wage workers in the United States are not teens?  At this point, the average age of a minimum wage worker in this country is 36, and 56 percent of them are women.  Millions upon millions of Americans are working as hard as they can (often that means two or three jobs), and yet despite all of their hard work they still find themselves mired in poverty.  One of the big reasons for this is that we have created two classes of workers in the United States.  “Full-time workers” are entitled to an array of benefits and protections by law that “part-time workers” do not get.  And thanks to perverse incentives contained in Obamacare and other ridiculous laws, we have motivated employers to move as many workers from the “full-time” category to the “part-time” category as possible.  It may be hard to believe, but right now only 44 percent of all U.S. adults are employed for 30 or more hours each week.  But to get any kind of a job at all is a real challenge in many parts of the country today.  As you read this article, there are more than 100 million working age Americans that are not employed in any capacity.  And according to John Williams of shadowstats.com, if the federal government was actually using honest numbers the unemployment rate would be sitting at 23 percent.  That is not an “employment recovery” – that is a national crisis.

The following infographic comes from the Economic Policy Institute.  I certainly do not agree with a lot of the things that the Economic Policy Institute stands for, but I think that these numbers do accurately reflect what “part-time America” looks like today…

Minimum Wage - Economic Policy Institute

So what is the solution to this problem?

Most Democrats believe that raising the minimum wage would fix this.  But as Zero Hedge has pointed out, it isn’t quite that simple…

Last week, we noted that Democratic lawmakers in the US are pushing for what they call “$12 by ’20” which, as the name implies, is an effort to raise the minimum wage to $12/hour over the course of the next five years. Republicans argue that if Democrats got their wish and the pay floor were increased by nearly 70%, it would do more harm than good for low-income Americans as the number of jobs that would be lost as a result of employers cutting back in the face of dramatically higher labor costs would offset the benefit that accrues to the workers who are lucky enough to keep their jobs.

Yes, raising the minimum wage would make life better for many minimum wage workers in America.  But a large number of them would also lose their jobs completely, and a lot of small businesses would deeply suffer financially.

Ideally, what we would love to see happen is for the U.S. economy to be producing so many good jobs that the only people that are looking for entry-level part-time jobs would be teens, people just starting out in the workforce, etc.  Back when I was a teen, I remember walking into a McDonald’s and getting hired on the spot because they were in dire need of workers.  Sadly, those days are long, long gone.

Over the past several decades, millions of good paying American jobs have been shipped overseas, and millions more have been lost to advancing technology.  And as I wrote about the other day, Barack Obama is deeply betraying American workers by working on a global economic treaty that would destroy millions more good paying jobs.

Thanks to the foolishness of our politicians, there is now intense competition even for minimum wage jobs at this point.

We keep hearing about an “employment recovery”, but it is a giant lie.  Posted below is a chart of the civilian employment to population ratio.  As you can see, the percentage of the working age population that is actually employed is much, much lower than it used to be…

Employment Population Ratio 2015

In recent months, we have seen the employment-population ratio move slightly higher.  But can this be called “an employment recovery”?  Of course not.  We are still way, way below the level that we were at just prior to the last recession, and now the next recession is just about upon us.

Meanwhile, the quality of our jobs continues to decline as more Americans are being pushed into “part-time work” with each passing year.

Since February of 2008, the size of the U.S. population has grown by 16.8 million people.  But during that same time frame, the number of full-time jobs in this country has actually decreased.

And at this point, the majority of American workers simply do not make enough money to support a middle class family.  The following income numbers come directly from the Social Security Administration…

-39 percent of American workers make less than $20,000 a year.

-52 percent of American workers make less than $30,000 a year.

-63 percent of American workers make less than $40,000 a year.

-72 percent of American workers make less than $50,000 a year.

Are you starting to see why I am so fired up about all of this?

We have developed a business culture in this country which does not care about workers.  In business schools all over America, future executives are taught that a corporation only has one goal – to maximize wealth for the shareholders.  Taking care of those that are part of your team is treated as an afterthought at best.

As corporations have gotten bigger, they have shown less and less concern for those that work for them.  These days, employees are generally regarded as “expensive liabilities” that are to be discarded the moment that their usefulness has come to an end.  And news of layoffs is often rewarded by Wall Street by a surge in the stock prices of the companies making those layoffs.

In the old days, more businesses in America were family-owned, and employees were often regarded as almost “part of the family”.  Unfortunately, those days have disappeared forever.

Now, employees are treated like scum by many big companies, and if they don’t like how they are being treated they are told that they can leave.  For example, just consider what was going on at a security company down in Florida…

Jose Molero worked as a site inspector for the company, which provides security for neighborhoods and companies across the country, for more than a year.

Molero says when he went to the Kensington Golf and Country Club guardhouse, he found wooden paddles on a desk, some with staff names on them and one reading “for staff discipline.”

He says there was also what is called a “Wall of Shame,” where the supervisor points out and posts reports that contain grammatical errors.

When Molero complained about these things to his district manager, he was told that if anyone was offended “maybe they shouldn’t work here”…

Molero contacted his operations manager, who told him to speak with the district manager. He says the district manager sent him an email response that said, “if that hurts their feelings then maybe they shouldn’t work here.”

Do you have a similar horror story to share?

Most of us do.

The U.S. economy is absolutely dominated by cold, heartless corporations that have no interest in listening to the little guy.  If they could find a way to do it, many of them would operate with no low-level employees at all.  And as technology continues to advance, they will replace as many of us as they can with robots, drones, machines and computers.

I’ll be honest with you – the future for workers in America looks really bleak.  The competition for any jobs that can’t be shipped overseas or replaced by technology is going to become even more heated.  This means that the middle class is going to get even smaller, the number of Americans dependent on the government is going to continue to explode, and the disparity between the wealthy and the poor is going to become even greater.

So what is the solution to this giant mess?  Please feel free to tell us what you think by posting a comment below…

Obamacare = A Death Panel For The U.S. Economy

Obamacare LineDid you know that some Americans are being hit with health insurance rate increases of more than 500 percent?  Taking advantage of “the stupidity of the American voter”, the Democrats succeeded in ramming through one of the worst pieces of legislation that has ever come before Congress.  The full implementation of Obamacare has been repeatedly delayed, but now we are finally starting to see the true horror of this terrible law.  Thanks to Obamacare, millions of American families are losing health plans that they were very happy with, health insurance rates are skyrocketing, millions of workers are having their full-time hours cut back to part-time hours, rural hospitals all over the country are dying, and thousands of doctors are being driven out of the industry thus intensifying the greatest doctor shortage in U.S. history.  Obamacare is a slow-motion train wreck of epic proportions, and the full effect of this law is only beginning to be felt.  In the end, the economic impact of this law will likely be measured in the trillions of dollars.

One of the primary reasons why Democrats experienced so much pain during the recent elections was because millions of Americans are receiving some very disturbing letters from their health insurance providers.  At a time when U.S. incomes are stagnating, health insurance rates are rising to absolutely ridiculous levels.

As the New York Times recently reported, even the Obama administration is admitting that “substantial price increases” are on the way…

The Obama administration on Friday unveiled data showing that many Americans with health insurance bought under the Affordable Care Act could face substantial price increases next year — in some cases as much as 20 percent — unless they switch plans.

The data became available just hours before the health insurance marketplace was to open to buyers seeking insurance for 2015.

An analysis of the data by The New York Times suggests that although consumers will often be able to find new health plans with prices comparable to those they now pay, the situation varies greatly from state to state and even among counties in the same state.

Originally, Barack Obama promised that if we liked our current health plans that we could keep them.  Well, it turns out that was not true at all.  Instead, the vast majority of us will eventually have to move to new plans if we have not done so already.  This is particularly true for those that purchase health insurance individually.  The following is an excerpt from an NBC News investigation…

Four sources deeply involved in the Affordable Care Act tell NBC News that 50 to 75 percent of the 14 million consumers who buy their insurance individually can expect to receive a “cancellation” letter or the equivalent over the next year because their existing policies don’t meet the standards mandated by the new health care law. One expert predicts that number could reach as high as 80 percent. And all say that many of those forced to buy pricier new policies will experience “sticker shock.”

This is something that actually happened to me.  I received a letter in the mail informing me that my new health insurance policy which meets the requirements of Obamacare will cost me nearly twice as much as my old one.

Needless to say, I was not too thrilled about that.

Other Americans are being hit even harder.  For instance, one family down in Texas got hammered with a 539 percent rate increase…

Obamacare is named the “Affordable Care Act,” after all, and the President promised the rates would be “as low as a phone bill.” But I just received a confirmed letter from a friend in Texas showing a 539% rate increase on an existing policy that’s been in good standing for years.

As the letter reveals (see below), the cost for this couple’s policy under Humana is increasing from $212.10 per month to $1,356.60 per month. This is for a couple in good health whose combined income is less than $70K — a middle-class family, in other words.

These rate increases are coming at a time when the middle class in the U.S. is already steadily shrinking.  A lot of families that are already stretched to the breaking point are making the very painful decision to give up health insurance entirely.  At this point, there are millions of families that simply cannot afford it.

But Obama is not about to let those people off the hook.  In fact, huge tax penalties are on the way for those that do not participate in the new system…

Penalties for failing to secure a health-insurance plan will rise steeply next year, which could take a big bite out of some families’ pocketbooks.

“The penalty is meant to incentivize people to get coverage,” said senior analyst Laura Adams of InsuranceQuotes.com. “This year, I think a lot of people are going to be in for a shock.”

In 2014, Obamacare’s first year, individuals are facing a penalty of $95 per person, or 1 percent of their income, depending on which is higher. If an American failed to get coverage this year, that penalty will be taken out of their tax refund in early 2015, Adams noted.

While that might be painful to some uninsured Americans who are counting on their tax refunds in early 2015, the penalty for going uninsured next year is even harsher. The financial penalty for skipping out on health coverage will more than triple to $325 per person in 2015, or 2 percent of income, depending on whichever is higher.

Children will be fined at half the adult rate, or $162.50 for those under 18 years old.

No wonder so many people are so angry with the Democrats.

And as Massachusetts Institute of Technology professor Jonathan Gruber has so infamously observed, Obamacare never would have become law if the American people had been told the truth about what it would do to them.

It has been documented that Gruber has visited the White House about a dozen times since 2009, and he has been one of the leading intellectual proponents of Obamacare.  A video in which he states that “the stupidity of the American voter” was “really critical” to the passage of Obamacare has gone viral over the past week.  I have posted a copy of this video below…

What he is essentially saying is that the Democrats purposely deceived the American people because it was the only way that Obamacare was going to become law.

And this is a man that has become very wealthy advising government on healthcare matters.  According to an article in the Washington Post, he has made millions of dollars from “consulting” in recent years…

Not all of the contracts could be found on public Web sites, but here is a sampling. In some cases, Gruber worked with other consultants, so the fees were shared. These figures also might not represent the final payout, and of course these are gross figures, before expenses. But it’s safe to say that about $400,000 appears to be the standard rate for gaining access to the Gruber Microsimulation Model.

Michigan: $481,050

Minnesota: $329,000

Vermont: $400,000

Wisconsin: $400,000

Gruber has also earned more than $2 million over the last seven years for an ongoing contract with HHS to assess choices made by the elderly in Medicare’s prescription-drug plan.

If you are Gruber, life is quite good.

But for most of the rest of America, the economic pain continues.

For example, one recent study found that almost half of all Floridians cannot even afford “to pay for basic necessities”…

Nearly half of Florida households do not earn enough to pay for basic necessities, according to a report released Tuesday by the United Way that seeks to cast a light on the large group of state residents who struggle financially but do not meet the official criteria for being in poverty.

While 15 percent of Florida households are below the poverty level, another 30 percent are financially insecure — a figure that also applies to Sarasota and Manatee counties — based on a new measurement developed by the United Way.

If all those people cannot even afford the basics, how are they going to pay for Obamacare?

This law is going to financially cripple millions of American families.  It truly is a death panel for the U.S. economy.  And because Barack Obama can veto anything that the Republicans in Congress do, we are stuck with it for at least another two years (and probably longer).

So what about you?

Have your health insurance premiums gone up yet?

Please feel free to add to the discussion by posting a comment below…

How Will The Economy Improve In 2014 If Almost Everyone Has Less Money To Spend?

Piggybank - Photo by Damian O'SullivanIs the U.S. consumer tapped out?  If so, how in the world will the U.S. economy possibly improve in 2014?  Most Americans know that the U.S. economy is heavily dependent on consumer spending.  If average Americans are not out there spending money, the economy tends not to do very well.  Unfortunately, retail sales during the holiday season appear to be quite disappointing and the middle class continues to deeply struggle.  And for a whole bunch of reasons things are likely going to be even tougher in 2014.  Families are going to have less money in their pockets to spend thanks to much higher health insurance premiums under Obamacare, a wide variety of tax increases, higher interest rates on debt, and cuts in government welfare programs.  The short-lived bubble of false prosperity that we have been enjoying for the last couple of years is rapidly coming to an end, and 2014 certainly promises to be a very “interesting year”.

Obamacare Rate Shock

Most middle class families are just scraping by from month to month these days.

Unfortunately for them, millions of those families are now being hit with massive health insurance rate increases.

In a previous article, I discussed how one study found that health insurance premiums for men are going to go up by an average of 99 percent under Obamacare and health insurance premiums for women are going to go up by an average of 62 percent under Obamacare.

Most middle class families simply cannot afford that.

Earlier today, I got an email from a reader that was paying $478 a month for health insurance for his family but has now received a letter informing him that his rate is going up to $1,150 a month.

Millions of families are receiving letters just like that.  And to say that these rate increases are a “surprise” to most people would be a massive understatement.  Even people that work in the financial industry are shocked at how high these premiums are turning out to be…

“The real big surprise was how much out-of-pocket would be required for our family,” said David Winebrenner, 46, a financial adviser in Lebanon, Ky., whose deductible topped $12,000 for a family of six for a silver plan he was considering. The monthly premium: $1,400.

Since Americans are going to have to pay much more for health insurance, that is going to remove a huge amount of discretionary spending from the economy, and that will not be good news for retailers.

Get Ready For Higher Taxes

When you raise taxes, you reduce the amount of money that people have in their pockets to spend.

Sadly, that is exactly what is happening.

Congress is allowing a whopping 55 tax breaks to expire at the end of this year, and when you add that to the 13 major tax increases that hit American families in 2013, it isn’t a pretty picture.

This tax season, millions of families are going to find out that they have much higher tax bills than they had anticipated.

And all of this comes at a time when incomes in America have been steadily declining.  In fact, real median household income has declined by a total of 8 percent since 2008.

If you are a worker, you might want to check out the chart that I have posted below to see where you stack up.  In America today, most workers are low income workers.  These numbers come from a recent Huffington Post article…

-If you make more than $10,000, you earn more than 24.2% of Americans, or 37 million people.

-If you make more than $15,000 (roughly the annual salary of a minimum-wage employee working 40 hours per week), you earn more than 32.2% of Americans.

-If you make more than $30,000, you earn more than 53.2% of Americans.

-If you make more than $50,000, you earn more than 73.4% of Americans.

-If you make more than $100,000, you earn more than 92.6% of Americans.

-You are officially in the top 1% of American wage earners if you earn more than $250,000.

-The 894 people that earn more than $20 million make more than 99.99989% of Americans, and are compensated a cumulative $37,009,979,568 per year.

It is important to keep in mind that those numbers are for the employment income of individuals not households.  Most households have more than one member working, so overall household incomes are significantly higher than these numbers.

Higher Interest Rates Mean Larger Debt Payments

On Tuesday, the yield on 10 year U.S. Treasuries rose to 3.03 percent.  I warned that this would happen once the taper started, and this is just the beginning.  Interest rates are likely to steadily rise throughout 2014.

The reason why the yield on 10 year U.S. Treasuries is such a critical number is because mortgage rates and thousands of other interest rates throughout our economy are heavily influenced by that number.

So big changes are on the way.  As a recent CNBC article declared, the era of low mortgage rates is officially over…

The days of the 3.5% 30-year fixed are over. Rates are already up well over a full percentage point from a year ago, and as the Federal Reserve begins its much anticipated exit from the bond-buying business, I believe rates will inevitably go higher.

Needless to say, this is going to deeply affect the real estate market.  As Mac Slavo recently noted, numbers are already starting to drop precipitously…

The National Association of Realtors reported that the month of September saw its single largest drop in signed home sales in 40 months. And that wasn’t just a one-off event. This month mortgage applications collapsed a shocking 66%, hitting a 13-year low.

And U.S. consumers can expect interest rates on all kinds of loans to start rising.  That is going to mean higher debt payments, and therefore less money for consumers to spend into the economy.

Government Benefit Cuts

Well, if the middle class is going to have less money to spend, perhaps other Americans can pick up the slack.

Or maybe not.

You certainly can’t expect the poor to stimulate the economy.  As I mentioned yesterday, it is being projected that up to 5 million unemployed Americans could lose their unemployment benefits by the end of 2014, and 47 million Americans recently had their food stamp benefits reduced.

So the poor will also have less money to spend in 2014.

The Wealthy Save The Day?

Perhaps the stock market will continue to soar in 2014 and the wealthy will spend so much that it will make up for all the rest of us.

You can believe that if you want, but the truth is that there are a whole host of signs that the days of this irrational stock market bubble are numbered.  The following is an excerpt from one of my recent articles entitled “The Stock Market Has Officially Entered Crazytown Territory“…

The median price-to-earnings ratio on the S&P 500 has reached an all-time record high, and margin debt at the New York Stock Exchange has reached a level that we have never seen before.  In other words, stocks are massively overpriced and people have been borrowing huge amounts of money to buy stocks.  These are behaviors that we also saw just before the last two stock market bubbles burst.

If the stock market bubble does burst, the wealthy will also have less money to spend into the economy in 2014.

For the moment, the stock market has been rallying.  This is typical for the month of December.  You see, the truth is that investors generally don’t want to sell stocks in December because they want to put off paying taxes on the profits.

If stocks are sold before the end of the year, the profits go on the 2013 tax return.

If stocks are sold a few days from now, the profits go on the 2014 tax return.

It is only human nature to want to delay pain for as long as possible.

Expect to see some selling in January.  Many investors are very eager to start taking profits, but they wanted to wait until the holidays were over to do so.

So what do you think is coming up in 2014?  Please feel free to share what you think by posting a comment below…

Piggybank - Photo by Damian O'Sullivan

Obamacare: The Final Nail In The Coffin For The Middle Class

CoffinIf there were any shreds of hope left that the stunning decline of the middle class could be turned around, Obamacare has absolutely destroyed them.  Over the past decade or so, the middle class in the United States has been absolutely eviscerated.  The number of working age Americans without a job has increased by 27 million since the year 2000, median household income in the U.S. has fallen for five years in a row, and the poverty numbers in this country are spiraling out of control.  And now here comes Obamacare.  As you will see below, Obamacare is causing millions of Americans to lose their current health insurance policies, it is causing health insurance premiums to explode to absolutely ridiculous levels, and it is systematically killing jobs even though the employer mandate has been delayed for a while.  All of this is creating a tremendous amount of stress for millions of middle class families that are already stretched extremely thin financially.  According to CNN, a survey that was conducted earlier this year found that 76 percent of all Americans are living paycheck to paycheck.  Most of those families simply cannot afford to pay much higher health insurance premiums for new policies that also come with much larger deductibles and significantly increased out-of-pocket costs.  Millions of those families will ultimately end up choosing to do without health insurance altogether, and that will create a whole host of new problems.  This is a disaster that is so enormous that it is really hard to put into words.  If the U.S. health care system was a separate country, it would be the 6th largest economy on the entire globe all by itself.  And now Obamacare is going to bring the entire U.S. health care system to its knees.

Obamacare: Since October 1st, The Number Of Americans With Health Insurance Has Fallen By Nearly 4 Million

Last week, Barack Obama decided to allow Americans to keep their current health insurance plans for one more year.

Isn’t that generous of him?  Especially considering the fact that he promised us over and over that if we liked our current health insurance policies that we would be able to keep them permanently.

The funny thing is that Obama is not actually changing the law.  So if your health insurance company allows you to stay on your current health insurance plan that does not meet the requirements of Obamacare, it is technically breaking the law.

And if you continue to stay on that current health insurance plan that does not meet the requirements of Obamacare, you are technically breaking the law.

It is just that Obama has promised not to enforce what the law says for one year.

For a president to just blatantly disregard the rule of law is a very dangerous precedent.  Do we really want the president to have the power to decide what laws are going to be enforced and what laws are not going to be enforced?

That sounds dangerously close to a dictatorship to me.

And in any event, there are many Americans that are not going to be able to keep their current policies no matter what Obama says.  For example, just two hours after Obama announced his plan last week, the state of Washington announced that they would not be allowing insurance companies to extend their old health insurance plans if they don’t comply with Obamacare under any circumstances…

State Insurance Commissioner Mike Kreidler has rejected President Obama’s proposal to allow insurance companies to extend health insurance policies for people who have received notices that their policies will be cancelled at the end of the year.

Within two hours of President Obama’s news conference announcing the proposed administrative fix for Americans upset by their policy cancellations, Kreidler issued a statement rejecting the proposal.

“I understand that many people are upset by the notices they have recently received from their health plans and they may not need the new benefits [in the Affordable Care Act] today,” he said. “But I have serious concerns about how President Obama’s proposal would be implemented and more significantly, its potential impact on the overall stability of our health insurance market.”

“I do not believe his proposal is a good deal for the state of Washington,” Kreidler’s statement continued. “We will not be allowing insurance companies to extend their policies.”

How do you think the people of the state of Washington will respond to that?

Things are getting crazy out there, and the number of people that are losing their health insurance policies is absolutely stunning.

According to the Wall Street Journal, so far 106,185 Americans have enrolled in Obamacare since October 1st.  Most of those that have successfully enrolled have done so through the state insurance exchanges.  So far, only 26,794 Americans have signed up for health insurance using the federally run exchanges on HealthCare.gov.

Meanwhile, during that same time frame, 4.02 million Americans have had their health insurance policies cancelled.

So that means that the number of Americans with health insurance has actually decreased by 3,918,205 since October 1st.

Wasn’t Obamacare supposed to result in more Americans being covered?

And according to U.S. Senator Rand Paul, Obama not only knew that this would happen, he actually wrote the regulation that caused this to happen…

“I’m still learning about it. It’s 20,000 pages of regulations. The Bill was 2,000 pages and I didn’t realize this until this week, the whole idea of you losing or getting your insurance cancelled wasn’t in the original Obamacare. It was a regulation WRITTEN BY PRESIDENT OBAMA, three months later. So we had a vote, this is before I got up there. The Republicans had a vote to try to cancel that regulation so you COULDN’T BE CANCELLED, to grandfather everybody in. You know what the vote was? Straight party line. EVERY DEMOCRAT VOTED TO KEEP THE RULE THAT CANCELS YOUR INSURANCE.”

So now millions of Americans, including women battling cancer, are losing health insurance plans that they were depending upon.

Thanks Obama?

Obamacare: Skyrocketing Health Insurance Premiums

How much more are you willing to pay for health insurance than you are paying right now?

10 percent?

20 percent?

30 percent?

Well, according to one study health insurance premiums for men are going to go up by an average of 99 percent under Obamacare and health insurance premiums for women are going to go up by an average of 62 percent under Obamacare.

And of course some groups are going to see increases that are much larger than that.  For example, it is being projected that health insurance premiums for healthy 30-year-old men will rise by an average of 260 percent.

Ouch.

And there are some families out there that have already been hit with health insurance premium increases that are absolutely jaw-dropping.  In a previous article, I included the example of one family down in Texas that has been hit with a 539% rate increase…

Obamacare is named the “Affordable Care Act,” after all, and the President promised the rates would be “as low as a phone bill.” But I just received a confirmed letter from a friend in Texas showing a 539% rate increase on an existing policy that’s been in good standing for years.

As the letter reveals (see below), the cost for this couple’s policy under Humana is increasing from $212.10 per month to $1,356.60 per month. This is for a couple in good health whose combined income is less than $70K — a middle-class family, in other words.

Obamacare: Enormous Deductibles And Huge Out-Of-Pocket Expenses For All

It isn’t just health insurance premiums that are going up either.  Deductibles are going up too.  In fact, just check out what one survey of Americans living in seven different states recently discovered…

Expenses for some policies can reach $6,350 for a single person and $12,700 per family, the most allowed by the health-care law, according to a survey by HealthPocket Inc. of seven states, including California and Ohio. That’s 26 percent higher than the average deductible in the seven states, and a scenario likely repeated across the country, said Kev Coleman, head of research and data at Sunnyvale, California-based HealthPocket.

That same article has a great quote from an elderly New Jersey resident.  82-year-old Larry Saphire thinks that if you have to pay a $5,000 deductible up front, “you might as well not have any insurance at all”…

“If you have to pay $5,000 upfront” when illness hits, “you might as well not have any insurance at all,” said Larry Saphire, 82, of West Orange, New Jersey, who shopped for coverage for his wife and two children, ages 16 and 21. “That’s not insurance.”

On California’s state-run exchange site, the standard low-premium “bronze” plan carries a $5,000 deductible per person, a $60 co-pay to see a doctor and a 30 percent fee, known as coinsurance, on hospital care. In Rhode Island, Blue Cross Blue Shield’s bronze plan has a $5,800 deductible while Missouri’s U.S.-run exchange offers plans by Anthem Blue Cross with the maximum-allowable $6,350 in out-of-pocket costs.

Obamacare: The Quality Of Care Is Going To Go Into The Toilet

A lot of Americans that are signing up for Obamacare are going to be in for a huge shock.  Many of the best hospitals and many of the best doctors are not covered by their plans…

Meanwhile, sometime between March and June, the other shoe drops: People who bought exchange policies realize that the restricted networks insurers created to keep the premium costs low cut out the best hospitals and doctors. A newly insured child with cancer cannot get into a top pediatric hospital because her insurance has zero coverage for out-of-network emergency care. Tearful Mom goes on the evening news and says that she thought when they went on Obamacare, that meant they were safe, and why can’t I take my baby to Philadelphia Children’s Hospital, Mr. President?

Can you imagine being a parent in that situation?

In response, some hospitals are already filing suit over this.  For instance, check out what is happening over in Seattle…

Seattle Children’s Hospital filed suit against Washington State’s Office of the Insurance Commissioner this week, after Obamacare implementation caused the hospital to be cut from four of the six insurance plans offered by the new Washington Health Benefit Exchange.

And even if you are on Medicare that does not mean that the quality of your care is going to stay the same either.  As Reuters just reported, UnitedHealth is dumping “thousands of doctors” from their Medicare Advantage plans for the elderly because of Obamacare…

UnitedHealth Group dropped thousands of doctors from its networks in recent weeks, leaving many elderly patients unsure whether they need to switch plans to continue seeing their doctors, the Wall Street Journal reported on Friday.

The insurer said in October that underfunding of Medicare Advantage plans for the elderly could not be fully offset by the company’s other healthcare business. The company also reported spending more healthcare premiums on medical claims in the third quarter, due mainly to government cuts to payments for Medicare Advantage services.

In the United States, we already pay much more for health care than everyone else in the world, and we typically have to wait longer to see a doctor than most of the rest of the industrialized world does.

Now Obamacare is going to make all of this even worse, and the quality of the care that we receive is going to go downhill fast.

Obamacare: The Jobs Killer

A while back, Obama unilaterally made the decision to delay the implementation of the employer mandate until 2015.

That was probably a good political decision, because it would have been a huge political issue in the 2014 elections.

But the truth is that we won’t have to wait until 2015 for Obamacare to start killing jobs.  In fact, according to CNBC it is already happening…

Approximately one-third of business decision-makers at companies with between 40 and 500 employees, say the health-care law has already increased their costs due to hikes in both the cost of insurance and compliance, according to a recent report from political-research firm Public Opinion Strategies. As a result, many business leaders say they are already making personnel decisions based on the Affordable Care Act.

Among franchised businesses, 27 percent report their company has replaced full-time workers with part-time workers and 31 percent have reduced worker hours. Among non-franchised businesses, 12 percent are replacing full-time workers with part-time workers or reducing hours. This is happening now, with more than a year before the mandate goes into effect; and undoubtedly, these numbers will rise as we approach next July’s “look back” period for tabulating workers’ hours.

It is kind of startling that we are already seeing employers make such big changes even though the employer mandate does not come into effect until 2015.  You can find a very long list of some of the employers that have already either eliminated jobs or cut hours because of Obamacare right here.

Remember, this is just the tip of the iceberg.  Once we get closer to the deadline things are going to get much, much worse.

At a time when the middle class desperately needs jobs, Obamacare is going to slaughter them.

And even if you are able to keep your current job, that does not mean that your health plan will remain the same.  In fact, Forbes is projecting that a staggering 51 percent of all employment-based health insurance plans will be canceled and replaced with new ones.

Overall, Forbes is projecting that an astounding 93 million Americans will eventually lose their current health insurance policies due to Obamacare.

Obamacare: Providing Huge Incentives For Many Americans To Work Less And Make Less Money

Did you know that Obamacare is going to cause millions of Americans to want to keep their incomes under certain levels?

If you make too much money under Obamacare, you will miss out on some absolutely massive health care subsidies.  The following is an excerpt from one of my previous articles…

—–

The figures that you are about to see were calculated using the Kaiser Family Foundation subsidy calculator.  These numbers apply to a husband and a wife that are both 62 years old.

A non-smoking, married couple living in San Francisco, California earning $63,000 a year will have to pay $20,318 a year for a silver plan under Obamacare and $12,647 a year for a bronze plan.

At $63,000, that couple would be making too much money to be eligible for a subsidy, so that couple will have to pay the total cost of whatever plan they choose by themselves.

But if that couple only made $62,000 a year, things would dramatically change.

The plans would still cost the same, but the couple would now be eligible for an Obamacare subsidy of $14,428.

So a silver plan would end up costing them only $5,890, and they would ultimately pay nothing for a bronze plan.

In other words, by reducing their income by $1,000, that couple would save $14,428 if they got a silver plan or they would save $12,647 if they got a bronze plan.

Isn’t that bizarre?

—–

In the end, millions upon millions of middle class families will decide to go without health insurance entirely for one reason or another.

This will work great until they get into an accident or become seriously ill.

As I have discussed previously, approximately 60 percent of all personal bankruptcies in the United States are related to medical bills.  And most of those bankruptcies actually happen to people that are supposedly “covered” by health insurance.

Obamacare is going to make all of this so much worse.  Millions of middle class families will end up with no health insurance at all, and because so many of them are living paycheck to paycheck a single health emergency will be enough to send them hurtling down the path to financial oblivion.

If you get into an accident, a visit to the emergency room and a single night in the hospital can easily cost tens of thousands of dollars in many areas of the country.

If you get a serious illness such as cancer, the medical bills can be absolutely astronomical.  For instance, there are many cancer patients that rack up medical bills well in excess of a million dollars by the time that they die.

Something desperately needs to be done about our horrible health care system.  Unfortunately, Obamacare is going to make just about everything that is bad about our current system much, much worse.

And the American people are becoming increasingly disgusted and frustrated with Obamacare.  According to Real Clear Politics, an average of recent opinion polls shows that the American people are opposed to Obamacare by an average margin of 14.2 percentage points.

So what do you think about Obamacare?

Please feel free to share your opinion by posting a comment below, and please share this information with as many people as you possibly can.

Coffin

10 Signs That Obamacare Is Going To Wreck The U.S. Economy

Obamacare LineIt is hard to find the words to adequately describe how much of a disaster Obamacare is turning out to be.  The debut of Healthcare.gov has been probably the worst launch of a major website in history, millions of Americans are having their current health insurance policies canceled, millions of others are seeing the size of their health insurance premiums absolutely explode, and this new law is going to result in massive numbers of jobs being lost.  It is almost as if Obamacare was specifically designed to wreck the U.S. economy.  Not that what we had before Obamacare was great.  In fact, I have long argued that the U.S. health care system is a complete and total train wreck.  But now Obamacare is making everything that was bad about our system much, much worse.  Americans are going to pay far more for health care, the quality of that care is going to go down, they are going to have to deal with far more medical red tape, and thousands upon thousands of U.S. employers are considering getting rid of the health plans that they offer to employees altogether due to Obamacare.  If the U.S. health care system was a separate nation, it would be the 6th largest economy on the entire planet, and now Obamacare is going to absolutely cripple it.  To say that Obamacare is an “economic catastrophe” would be a massive understatement.

Of course we were assured that it wouldn’t turn out this way.  We were promised over and over that we were going to pay less for health care, get better coverage, and be able to keep our current health plans if we were pleased with them.  The following is what Obama said at a rally in 2009…

“First of all, if you’ve got health insurance, you like your doctors, you like your plan, you can keep your doctor, you can keep your plan. Nobody is talking about taking that away from you.”

Oh really?

That was such a dramatic lie that even NBC News is turning on him.  They discovered that Obama has known for three years that most people that rely on individual health insurance policies would not be able to keep them…

Buried in Obamacare regulations from July 2010 is an estimate that because of normal turnover in the individual insurance market, “40 to 67 percent” of customers will not be able to keep their policy. And because many policies will have been changed since the key date, “the percentage of individual market policies losing grandfather status in a given year exceeds the 40 to 67 percent range.”

That means the administration knew that more than 40 to 67 percent of those in the individual market would not be able to keep their plans, even if they liked them.

Pretty much everything that Obama told us when he was selling us on his plan has turned out to be a lie.

So what can we expect from Obamacare moving forward?  The following are 10 signs that Obamacare is going to wreck the U.S. economy…

#1 It is being projected that millions upon millions of Americans are going to lose their current health insurance plans thanks to Obamacare.  Most will be faced with the choice of either purchasing much more expensive health insurance or going uninsured.  This will put even more stress on a middle class that is already disintegrating rapidly.  The following is from the recent NBC News investigation mentioned above…

Four sources deeply involved in the Affordable Care Act tell NBC News that 50 to 75 percent of the 14 million consumers who buy their insurance individually can expect to receive a “cancellation” letter or the equivalent over the next year because their existing policies don’t meet the standards mandated by the new health care law. One expert predicts that number could reach as high as 80 percent. And all say that many of those forced to buy pricier new policies will experience “sticker shock.”

#2 The health insurance premium increases that some families are experiencing are absolutely mind boggling.  According to Mike Adams of Natural News, one family in Texas just got hit with a 539% rate increase…

Obamacare is named the “Affordable Care Act,” after all, and the President promised the rates would be “as low as a phone bill.” But I just received a confirmed letter from a friend in Texas showing a 539% rate increase on an existing policy that’s been in good standing for years.

As the letter reveals (see below), the cost for this couple’s policy under Humana is increasing from $212.10 per month to $1,356.60 per month. This is for a couple in good health whose combined income is less than $70K — a middle-class family, in other words.

According to NBC News, an elderly couple in North Carolina was hit with a similar rate increase…

George Schwab, 62, of North Carolina, said he was “perfectly happy” with his plan from Blue Cross Blue Shield, which also insured his wife for a $228 monthly premium. But this past September, he was surprised to receive a letter saying his policy was no longer available. The “comparable” plan the insurance company offered him carried a $1,208 monthly premium and a $5,500 deductible.

Many Americans that were formerly in favor of Obamacare are now against it after they have seen what it is going to do to their budgets.  The following is one example of this from a recent Los Angeles Times article…

Pam Kehaly, president of Anthem Blue Cross in California, said she received a recent letter from a young woman complaining about a 50% rate hike related to the healthcare law.

“She said, ‘I was all for Obamacare until I found out I was paying for it,'” Kehaly said.

#3 Obamacare actually includes incentives for people to work less and make less money.  The following is one example from a recent article by Sean Davis…

In California, a couple earning $64,000 a year would not qualify for health care subsidies. A bronze plan for them through Kaiser would cost them about $1,300 each month, or $15,600 a year. But if that same family earned just $2,000 less, it would qualify for over $14,000 in annual health care subsidies, dropping their premiums for that same Kaiser plan to less than $100 per month.

#4 Thankfully the employer mandate in Obamacare was delayed for a little while, but it will ultimately result in widespread job losses all over the country.  In fact, we are already starting to see this happen.  The following is from a recent article in the Economist…

BEFORE the recession, Richard Clark’s cleaning company in Florida had 200 employees, about half of them working full time. These days it has about 150, with 80% part-time. The downturn explains some of this. But Mr Clark also blames Barack Obama’s health reform. When it comes into effect in January 2015, Obamacare will require firms with 50 or more full-time employees to offer them affordable health insurance or pay a fine of $2,000-3,000 per worker. That is a daunting prospect for firms that do not already offer coverage. But for many, there is a way round the law.

Mr Clark says he is “very careful with the threshold”. To keep his full-time workforce below the magic number of 50, he is relying more on part-timers. He is not alone. More than one in ten firms surveyed by Mercer, a consultancy—and one in five retail and hospitality companies—say they will cut workers’ hours because of Obamacare. A hundred part-timers can flip as many burgers as 50 full-timers, and the former will soon be much cheaper.

You can find a very long list of some of the employers that have either eliminated jobs or cut hours because of Obamacare right here.

#5 Even if you are able to keep your job, there is no guarantee that your employer will continue to offer health insurance as an employee benefit.  In fact, it is being reported that large numbers of employers have already decided to no longer offer health insurance to their employees because of Obamacare.

#6 According to CBS News, so far the number of people that have had their health insurance policies canceled is more than three times greater than the number of people that have signed up for new policies under Obamacare…

CBS News has learned more than two million Americans have been told they cannot renew their current insurance policies — more than triple the number of people said to be buying insurance under the new Affordable Care Act, commonly known as Obamacare.

#7 If what is going on in New York is any indication, those that are signing up for health insurance under Obamacare are going to have a really, really hard time finding a doctor…

New York doctors are treating ObamaCare like the plague, a new survey reveals.

A poll conducted by the New York State Medical Society finds that 44 percent of MDs said they are not participating in the nation’s new health-care plan.

Another 33 percent say they’re still not sure whether to become ObamaCare providers.

Only 23 percent of the 409 physicians queried said they’re taking patients who signed up through health exchanges.

#8 Obamacare is turning out to be a gold mine for hackers and identity thieves.  The personal information of millions of Americans could potentially end up being compromised.  According to CNN, Healthcare.gov was found to be teeming with security holes…

The Obamacare website has more than annoying bugs. A cybersecurity expert found a way to hack into users’ accounts.

Until the Department of Health fixed the security hole last week, anyone could easily reset your Healthcare.gov password without your knowledge and potentially hijack your account.

And according to the New York Post, Healthcare.gov has been designed so badly from a security standpoint that it might have to be “rebuilt from scratch”…

The chairman of the House Intelligence Committee said ObamaCare’s website, already a tangled mess, might need to be rebuilt from scratch to to protect against cyber-thieves because he fears it’s not a safe place right now for health-care consumers to deposit their personal information.

“I know that they’ve called in another private entity to try to help with the security of it. The problem is, they may have to redesign the entire system,” Rep. Mike Rogers said on Sunday on CNN’s “State of the Union” political talk show. “The way the system is designed, it is not secure.”

#9 As I noted in a previous article, approximately 60 percent of all personal bankruptcies in the United States are related to medical bills.  Because millions of Americans are now losing their health insurance policies and millions of others will choose to pay the fine rather than sign up for Obamacare, more Americans than ever will find themselves overwhelmed with medical bills when they get seriously sick.  This will result in even more personal bankruptcies.

#10 In the end, the burden for paying for the subsidies that Obamacare offers is going to overwhelmingly fall on the taxpayers.  This is going to cause our nightmarish national debt to get even worse.  Peter Schiff recently explained why this is going to happen…

It is also ironic that high-deductible, catastrophic plans are precisely what young people should be buying in the first place. They are inexpensive because they provide coverage for unlikely, but expensive, events. Routine care is best paid for out-of-pocket by value conscious consumers. But Obamacare outlaws these plans, in favor of what amounts to prepaid medical treatment that shifts the cost of services to taxpayers. In such a system, patients have no incentive to contain costs. Since the biggest factor driving health care costs higher in the first place has been the over use of insurance that results from government-provided tax incentives, and the lack of cost accountability that results from a third-party payer system, Obamacare will bend the cost curve even higher. The fact that Obamacare does nothing to rein in costs while providing an open-ended insurance subsidy may be good news for hospitals and insurance companies, but it’s bad news for taxpayers, on whom this increased burden will ultimately fall.

So what do you think of Obamacare?

Has it directly affected your life yet?

Please feel free to share your thoughts by posting a comment below…

Power Mad Obama Offers Two Choices: Unconditional Surrender Or Default

Obama SleepingBarack Obama is warning that if he does not get everything that he wants that he will force the U.S. government into a devastating debt default which will cripple the entire global economy.  In essence, Obama has become so power mad that he is actually willing to take the entire planet hostage in order to achieve his goals.  A lot of people are blaming the government shutdown on the Republicans, but they have already voted to fund the entire government except for Obamacare.  The U.S. Constitution requires that all spending bills originate in the House of Representatives, and the House did their duty by passing a spending bill.  If the Senate or the President do not like the bill that the House has passed, then negotiations need to take place.  That is how our system works.  And the weak-kneed Republicans have already indicated that they are willing to give up virtually all of their prior demands.  In fact, if Obama offered all of them 20 dollar gift certificates to Denny’s to end this crisis they would probably jump at that deal.  But that is not good enough for Obama.  He has made it clear that he will settle for nothing less than the complete and unconditional surrender of the Republican Party.

Why is Obama doing this?  Why is Obama willing to bring the country to the brink of financial disaster?

It isn’t hard to figure out.  Just check out what one senior Obama administration official said last week…

“We are winning…. It doesn’t really matter to us” how long the shutdown lasts “because what matters is the end result,” a senior Obama Administration official told the Wall Street Journal last week.

This is all about a political victory and crushing the Republicans.  Obama doesn’t really care how long this crisis lasts because he believes that he is getting the end result that he wants.

According to Obama, the Republican Party is just supposed to roll over and give him the exact spending bill that he wants and also give him another trillion dollar increase in the debt limit.

If the Republicans do not give him that, he is willing to plunge us into financial oblivion.

The funny thing is that most Americans do not want the debt limit increased.  According to one new poll, 58 percent of all Americans do not even want the debt ceiling to be increased by a single penny.

And recent polls show that Americans are against Obamacare by an average margin of about 10 percent.

But the pathetic Republican Party is actually willing to hand Obama a trillion dollar debt ceiling increase and fully fund Obamacare if Obama will at least give them something.

Unfortunately, Obama won’t even give them the time of day.

So don’t blame the Republicans for what is happening.  The Republicans have already compromised themselves to the point of utter disgrace.  If Obama had been willing to even compromise a couple of inches this entire crisis would already be over.

And nobody should be claiming that the Republicans won’t vote to end this shutdown.  They have already voted to end it.  The following is from a recent article by Thomas Sowell…

There is really nothing complicated about the facts. The Republican-controlled House of Representatives voted all the money required to keep all government activities going — except for ObamaCare.

This is not a matter of opinion. You can check the Congressional Record.

As for the House of Representatives’ right to grant or withhold money, that is not a matter of opinion either. You can check the Constitution of the United States. All spending bills must originate in the House of Representatives, which means that Congressmen there have a right to decide whether or not they want to spend money on a particular government activity.

Whether ObamaCare is good, bad or indifferent is a matter of opinion. But it is a matter of fact that members of the House of Representatives have a right to make spending decisions based on their opinion.

Once again, the Republicans have already indicated that they are willing to fund Obamacare.  They just want Obama to throw them a bone.

And Obama will not do it.

So either the Republicans are going to cave in completely (a very real possibility) or we are going to pass the “debt ceiling deadline”.

What happens then?

Well, we would have more of a “real government shutdown” than the fake shutdown that we are having right now.

Once the federal government cannot borrow any more money, it will only be able to spend what it actually has on hand.  That means that a lot more government functions will have to shut down.

Money will still be coming in to the government, but it won’t be enough to fund everything.  According to the Wall Street Journal, the federal government will still have enough money to pay interest on the debt, make Social Security payments, make Medicare payments, make Medicaid payments, provide food stamp benefits and pay the military if they cut almost everything else out.

The other day, I suggested that the federal government could potentially start defaulting on interest payments on the debt as early as November.  But that would only happen if the federal government manages their money foolishly.

If the federal government managed their money smartly and saved cash for the interest payments as they came due, they would not have to miss any.

But when was the last time the federal government ever did anything “smartly”?

For the sake of argument, however, let’s assume that the federal government can manage money wisely and can save up enough cash ahead of time for large interest payments as they come due.

If that could somehow be managed, then according to Paul Mampilly the government would never need to actually default…

The U.S. Treasury always has money coming into its accounts. So its always got some amount of cash that it can use to pay interest on bonds. That’s especially true right now because the government is partially shutdown and there’s no cash going out from its accounts.

In fact, when you look at it the U.S. Treasury should simply have no trouble making interest payments on bonds that it has issued.

And there’s no restriction on the U.S. Treasury prioritizing interest payments. Why?

The obligation to pay interest is set by the 1917 Second Liberty Bond Act and laws that commanded the Treasury to pay interest on the debt. You can look this up in section 3123 of Title 31 of the U.S. Code and section 4 of the 14th Amendment of the Constitution and in Supreme Court precedent (Perry v. United States). It’s all there in black and white.

So the only possible way the U.S. defaults on its debt is if Barack Obama, President of the United States, instructs his Treasury secretary Jack Lew to default on the debt.

And according to the Washington Post, Moody’s has just issued a memo that also indicates that the federal government should be able to make all interest payments even if the debt limit is not increased…

In a memo being circulated on Capitol Hill Wednesday, Moody’s Investors Service offers “answers to frequently asked questions” about the government shutdown, now in its second week, and the federal debt limit. President Obama has said that, unless Congress acts to raise the $16.7 trillion limit by next Thursday, the nation will be at risk of default.

Not so, Moody’s says in the memo dated Oct. 7.

“We believe the government would continue to pay interest and principal on its debt even in the event that the debt limit is not raised, leaving its creditworthiness intact,” the memo says. “The debt limit restricts government expenditures to the amount of its incoming revenues; it does not prohibit the government from servicing its debt. There is no direct connection between the debt limit (actually the exhaustion of the Treasury’s extraordinary measures to raise funds) and a default.”

Of course the federal government would have to stop throwing money around like a drunk gambler at a casino in Las Vegas in order for this to work.

On the very first day of the government shutdown, the feds gave $445 million to the Corporation for Public Broadcasting.  Apparently Elmo is considered to be “essential personnel” by the Obama administration.

And according to CNS News, the U.S. Army has committed more than $47,000 to buy a mechanical bull during this “shutdown”…

The government shutdown may be keeping furloughed federal workers at home, but on Monday the U.S. Army contracted to buy a mechanical bull.

The $47,174 contract was awarded on Oct. 7 to Mechanical Bull Sales Inc. of State College, Penn.

So needless to say, there is some serious doubt about whether the federal government would be able to manage their money effectively in the event that the debt ceiling deadline passes.

And if the U.S. did start defaulting on debt payments, it would be absolutely disastrous for the global economy as I discussed in a previous article…

“A U.S. debt default would cause stocks to crash, would cause bonds to crash, would cause interest rates to soar wildly out of control, would cause a massive credit crunch, and would cause a derivatives panic that would be absolutely unprecedented.  And that would just be for starters.”

Other nations that we depend upon to lend us money would stop lending to us and would start dumping U.S. debt instead.

Could you imagine what would happen if China started dumping a large portion of the 1.3 trillion dollars in U.S. debt that they are holding?

It would be a total nightmare.  The collapse of Lehman Brothers would pale in comparison.

And already some banks are stuffing their ATM machines with extra cash just in case the general public starts to panic.

But none of this has to happen.

If Obama decides to negotiate with the Republicans, this crisis will likely end very rapidly.

If not, and we pass the “debt ceiling deadline”, the federal government will still have enough money to make interest payments on the debt as long as they manage their money correctly.

Unfortunately, Obama seems far more interested in playing political games than he is in solving our problems.

In fact, Park Service rangers have been ordered to “make life as difficult for people as we can” during this government shutdown.  Obama has apparently decided to punish the American people in order to get leverage on the Republicans.  Just check out the following example from a new Weekly Standard article…

There’s a cute little historic site just outside of the capital in McLean, Virginia, called the Claude Moore Colonial Farm. They do historical reenactments, and once upon a time the National Park Service helped run the place. But in 1980, the NPS cut the farm out of its budget. A group of private citizens set up an endowment to take care of the farm’s expenses. Ever since, the site has operated independently through a combination of private donations and volunteer workers.

The Park Service told Claude Moore Colonial Farm to shut down.

The farm’s administrators appealed this directive​—​they explained that the Park Service doesn’t actually do anything for the historic site. The folks at the NPS were unmoved. And so, last week, the National Park Service found the scratch to send officers to the park to forcibly remove both volunteer workers and visitors.

Think about that for a minute. The Park Service, which is supposed to serve the public by administering parks, is now in the business of forcing parks they don’t administer to close. As Homer Simpson famously asked, did we lose a war?

The hypocrisy that Obama has demonstrated during this “government shutdown” has been astounding.

He has barricaded open air war memorials to keep military veterans from visiting them, but he temporarily reopened the National Mall so that a huge pro-immigration rally that would benefit him politically could be held.

He has continued to fund al-Qaeda rebels in Syria that are trying to overthrow the Syrian government, but he has been withholding death benefits from families of fallen U.S. soldiers.

The conduct of the Obama administration during this shutdown has been so egregious that is hard to put into words.  Obama has chosen to purposely harm the American people in order to score political points.

But this is how our politicians view us these days.  As Monty Pelerin recently explained, most of our politicians have absolutely no problem with exploiting us for their own purposes…

The concept of political service has been replaced by that of masked exploitation. The public is no longer viewed as clients or constituents to be served. Instead they have become political prey. Politicians see the public as a collection of wallets and votes, fair game to be hunted as the means to expand power and wealth. Constituents are now the Soylent Green of the political food chain.

The political class assumes the public exists to serve them, not the other way around. Public participation beyond the lightening of wallets or the provision of votes is unwelcome. It is considered “interference” that must be deterred by the ruling class.

The political class is now a huge, voracious parasite. Like the plant in the Little Shop of Horrors, its needs have grown to the point where it threatens anything productive. Its needs now exceed the willingness for continued sacrifice on the part of the productive. The parasite threatens the very existence of the host.

The political Ponzi scheme of tax, borrow and spend has reached its limit. Either it will die when citizens turn on it or it will kill the productive, ensuring its own destruction.

It perishes in the end. Whether it takes civilization with it is the bigger question.

Is there anyone out there that still does not believe that our system is broken?

Hopefully cooler heads will prevail and power mad Obama will decide to toss the Republicans a few crumbs and this crisis will be resolved.

Because if this crisis is not resolved soon, it could have consequences that are far beyond what any of us could possibly imagine.

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