Tag Archives: Nevada unemployment

Distraction, Diversion, and Division

Not so long ago the Bureau of Labor Statistics released its unemployment rate figures — Nevada has an 8% unemployment rate. [BLS]  Things could be worse in the land of all fifty states and the District of Columbia, we could be higher than Rhode Island’s 8.3% and be in 51st place in the nation.

Nevada Unemployment Rate ten yearOne quick glance at the chart from the Bureau of Labor Statistics indicates that Nevada is still trying to get back to employment rates at a level before the Wall Street induced mortgage meltdown and housing hosing.  So, what solutions are we discussing?

In the Reno area the question appears to be a matter of which Republican candidate in District 16 is the most Anti-Tax. [RGJ]  As if lowering taxes even more in this slogging state will induce businesses to relocate or to initiate commerce in this area.  The mythology of the right wing notwithstanding, there hasn’t been any evidence to support the myth since 1937 — once more into the graphs:

Taxes vs Jobs

And the explanation:

“The Tax Foundation, a respected conservative-leaning group, has analyzed tax issues since 1937. They publish reports showing the average income and average tax load for all 50 states. Their analysis includes all state and local taxes.

I’ve charted this data (below) and added a green line to separate the states with high incomes from the rest. Aside from a few outliers, the trend is obvious: All but one of the states that enjoy higher incomes (greater than $50,000 per person) also impose higher total taxes (above 9 percent). At the same time, all but one of the states that keep taxes low (less than 9 percent) have lower incomes.”  [USNWR]

And the bottom line expressed as tersely and concisely as possible:

There is no evidence in this chart to confirm that low taxes lead to prosperity. In contrast, higher taxes accompany higher incomes, not the other way around.” [USNWR]

What does contribute to economic well being?  In Massachusetts it’s the proximity and availability of top notch academic and scientific research institutions, as in northern California; in Wyoming and North Dakota it’s the accessibility of natural resources, in Florida its a well tended tourism sector, and in New York, Connecticut, and New Jersey it’s the financial sector of the economy, and so it goes.

However, let us immodestly conjecture that from the June 10th primary to the November 4th general elections we’ll all be inundated with the same tired, diversionary, divisive sloganeering which has impeded our capacity to slog out of the employment doldrums.

The magical pixie dust will be sprinkled liberally  “If we only had lower taxes we’d have more JOBS,” as if we could simply eliminate our state and local governments entirely and thereby secure 100% employment.

Meanwhile down in the southland, the immigration reform issue could be a crucial bit of the election picture.  No immigration policy reform vote no Latino voters, or expressed more delicately:

“In Nevada, the fate of immigration reform could impact Republican U.S. Reps Mark Amodei and Joe Heck — both of whom favor fixing the immigration system and have grown frustrated with GOP leadership for not holding a vote yet. They’re facing pressure from immigration advocates, who plan Wednesday to protest outside their Las Vegas offices.”  [LVRJ]

Not that either of the aforementioned gentlemen in the House of Representatives has actually made definitive statements about their positions on reform, both apparently accepting of the leadership stance that a piece meal approach is preferable to a comprehensive one.  Again, it’s predictable that they will continue to dodge and weave so long as the dreaded word “amnesty” is tossed about like so much pop-corn in a pan in the right wing media.

Failure to enact a comprehensive policy means we would leave on the table some 5.4% ($1.4 trillion) in economic growth nationally by 2033.  We’d be foregoing about 1% in overall productivity. We’d not see a projected $850 billion reduction in the federal deficit, and we’d not get the benefit of a nice 3% reduction in the national debt. [WH]   And we are concerned about the deficit and the debt aren’t we?

So, as politicians drone on about taking on immigration issues one piece at a time, or one little cautious step after another (such that nothing really ever gets done except fence building and deportations) imagine that $1.4 trillion in increased economic activity disappearing into a black hole.

When the stump orator decries how much “they” are “sucking” away in benefits and services, remember that one in four new enterprises are owned by immigrants.  Immigrants created 28% of all new businesses in 2011, and immigrants started 25% of the new enterprises in seven out of eight economic sectors, for example: Construction 31.8%, retail trade 29.1%, health care and social services 28.7%, and leisure and hospitality 23.9%. [RenewEcon]  Thus much for the “They’re taking our jobs” rhetoric.   If we truly want Job Creators then let’s give a hand up to the people who are creating 25% of all the new enterprises rather than wringing our hankies about the 0.1% who have already “made it.”

I wish I had more faith in the communication skills of our candidates, and in their capacity to research their talking points and create solutions to employment and immigration issues.  Instead, I have this sinking feeling that we’ll get more of the same old mixture of additional heat and a decreasing amount of light.

No doubt we will be advised that we have an “election integrity” issue and that only draconian vote suppression legislation will fix our (non-existent) problem — when we should be talking about immigration and the economy.

We’ll be told we have to promote a business friendly environment (translation: less taxation) when we should be talking about the investments needed to upgrade our educational and research capacity in order to advance our economy.  No, we’ll probably not compete on a level playing field with Stanford, Cal, and MIT, but we could be doing better.  We’ll get another serving of the mythology of the Tax/Enterprise ratio while knowing full well that a state which lacks the financial capacity to improve its infrastructure in transportation and communication is going to lag behind other states which have made these renovations a priority.

We’ll be distracted, diverted, and divided until the trash cans and recycle bins overflow with campaign brochures each less informative than the last.

Advertisements

1 Comment

Filed under Nevada politics, nevada taxation, nevada unemployment, Politics

Long Time Gone: Trickle Down Reps

Crystal BallLong term unemployment isn’t merely an economic concept — it’s 17,000 people in Nevada.  17,000 who will see the rug pulled because the Congress of the United States of America couldn’t agree to an extension.  [LVSun] December 28th is the not-so-magic cut off date.

Nevada is still sitting toward the top of the scale in the U1 unemployment calculation (U-1, persons unemployed 15 weeks or longer, as a percent of the civilian labor force) at 5.6%.  [BLS]  The District of Columbia has a 5.7% rate, California has a 5.2%, Georgia 5.0%, Illinois 5.2%, New Jersey 5.5%, and Mississippi 5.0%.

Nevada is still Number 1 in the U3 Lists — the unemployment number generally published — at 9.7%, and our U6 rate (U-6, total unemployed, plus all marginally attached workers, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached workers) is 18.1%.

Given this situation one might think Nevada’s representatives in Congress would be enthusiastic about jobs and bills to create jobs.  However, from Representative Joe Heck (R-NV3) we get a dose of good old fashioned Trickle Down Hoaxsterism:

“Job creation and turning our economy around is my top priority in Congress. As a former small business owner, I know what it takes to run a business, make a payroll and create jobs. Since coming to Congress, I have focused on introducing and supporting legislation that will create an environment that allows the private sector to thrive and create jobs. While there have been positive economic signs lately, we cannot turn our attention away from this critical issue.”  [Heck]

Note the emphasis — “introducing and supporting legislation that will create an environment that allows the private sector to thrive and create jobs” —  the statement is classic Trickling.  What we’ve witnessed since the monstrous collapse of the financial sector in 2007-2008 is that a “thriving” financial sector doesn’t necessarily mean job creation.

It’s not unusual for the financial sector to recover more quickly than the rest of the economy, it is unusual for business analysts to see the gap quite so quickly, as they did in October 2009:

“What’s different in this recovery is the extent to which the leading indicators are soaring ahead of the lagging ones. Wall Street cheered on Oct. 22 when the Conference Board’s measure of the economic outlook for the next three to six months rose a greater-than-expected 1%. But the same report saw the gauge of lagging indicators fall 0.3%. The worry is that if workers continue to lose their jobs and the ability to spend, the tentative recovery could morph into another downturn.” [Business Week]

While the total pessimists weren’t seeing the “W” shaped lagging indicators as as the calendar moved on, but Main Street still hasn’t recovered to the extent that it is driving “job creation.”  And, contrary to the self-congratulatory ruminations of the 1%, it’s Main Street, not Wall Street that creates jobs.

Heaven knows the “Quantitative Easing” from the Federal Reserve which has funneled some $29 trillion in liquidity into Wall Street over the past five years hasn’t created “an environment that allows the private sector to thrive and create jobs.”   Wall Street’s recovery hasn’t boosted Main Street’s economy.   Instead, an economist’s presentation to a Pennsylvania business event sounded a more somber note in late 2013:

“Economists say the recession is over but if you don’t have your job back, things are crummy and staying crummy,” Dr. Siegfried said. “Not only is the growth slow, relatively more and more is going to the elite of society, the higher income people.  “If you look at the real wages of people, their average income has been stagnant.”  [Times Trib]

Instead of a repudiation of the Trickle Down hoax and a recognition of the fact that Wall Street has recovered nicely and Main Street is still struggling with income stagnation and slow growth, we get this paean to Trickle Down from Representative Mark Amodei (R-NV2):

“Washington has tied the hands of small business owners and job creators with onerous regulations and backward fiscal policies that have stalled the economy, slowed innovation and destroyed jobs. We need common sense, pro-growth policies to give small businesses and entrepreneurs renewed confidence in our economy and to remove Washington as the roadblock to job creation.”

So, we might ask, if the QE fiscal policy from the Federal Reserve has amply rewarded  Wall Street institutions as they recover, how is this a “backward fiscal policy” stalling the economy?  The Financial Sector is not stalling, it’s not even coughing.   This morning the DJIA is sitting pretty at 15,928.32, a far cry from the 4,827.44 from April 2009.  A 230% improvement.

And, those “onerous regulations?”  This is campaign rhetoric not economic theory.  Unpopular regulations, such as those imposed in the wake of the Enron Debacle (Sarbanes Oxley) and after the financial sector casino collapse of 2008 (Dodd Frank) the real targets of conservative wrath — have precious little to do with Main Street commercial enterprises.

In short, those Nevadans believing that the Trickle Down pieties from Representatives Heck and Amodei will do anything toward the reduction of long term unemployment in Nevada are star gazing into the magic crystals of the Austerity for You Prosperity for Me Wall Street casino crowd.

Comments Off on Long Time Gone: Trickle Down Reps

Filed under Economy

Nevada Unemployment: Now can we talk about jobs?

Nevada annual unemploymentIt was the best of times, it was the worst of times,” when the annual unemployment rate in the state of Nevada dropped from 14.9% in 2010 to the current 9.5% rate finalized by the BLS as of August 2013.   Recalling that employment is a lagging indicator, the Housing Bubble which saw top home prices in Nevada in 2005 blew the bottom of the hiring line when the Bubble burst began in 2007 and headed downward until the NBER declared the official end of the Recession as of June 2009.

We should also recall that housing is a “midstream” sector, as explained by the EPI:

“Housing is a “mid-stream” sector of the economy, meaning that many other industries, both upstream and downstream, are affected by the health of the housing market. For example, the demand for building materials increases in a booming housing market, as does the demand for appliances and furnishings. Even more important in terms of dollars pumped into the economy, is appreciated home values, which have been an important source of stimulus over the past few years.”

In short, if one were to pick a sector which could create the most overall damage to the national — an by extension the state — economy, it would be difficult to find one more crucially situated than the housing sector.   We know things “blew up” but, why has Nevada’s unemployment rate stayed among the higher levels in the nation since the official end of the Recession as of June 2009?

Speaking in Generalities

There are some general reasons for the slow recovery.  First, the Federal Reserve wasn’t in much of a position to stimulate the U.S. economy.   The rates were already low at the beginning of the recovery, and therefore there wasn’t room to manipulate the economy via monetary policy.  When things fell to pieces in late 2008 the FED primary discount rate was 0.50, with a federal funds rate of 0.00 to 0.25 [NYFed] The federal funds rate is the important one to watch for our purposes because it’s the one which most often serves as the base rate for all other interest rates charged by lenders.   You can’t go much lower than 0.00 and thus the federal funds rate wasn’t all that useful in providing economic stimulus.

Secondly, consumers were “deleveraging.”  Consumer debt had been dropping since the fourth quarter of 2008, and didn’t pick up again until the fourth quarter of 2012. [NYFed]  As of January 2011, the San Francisco Fed reported their findings on the “slow recovery,” and linked the issue to the deleveraging of non-housing consumer debt:

“Overall, the county evidence strongly suggests that credit demand is weak because of an overleveraged household sector. This view is supported by survey evidence that the main worry of businesses is sales, not financing. The October 2010 National Federation of Independent Business survey (Dunkelberg and Wade 2010) shows that almost no small businesses viewed credit availability as their primary problem. In fact, the NFIB has reported that weak sales were the top problem facing small businesses throughout the recession. Weak consumer demand also helps explain the enormous cash balances currently held by U.S. corporations (see Lahart 2010). These results have important policy implications. If the main problems facing businesses relate to depressed consumer demand due to a household sector weighed down by debt, investment tax subsidies and lower interest rates may have a limited effect on business investment and employment growth.” (emphasis added)

What was the reason small and independent businesses weren’t recovering?  Weak demand.  Nevada’s economy, dependent as it is on tourism, requires a population ready and willing to part with their earnings, confident that the money they leave in Las Vegas (or Reno, or wherever) can stay there.

Third, we need to look at the overall slowing down of our economy, and for this perspective we should consider our “potential.”  Without diving too far down into the weeds, our GDP has “potential” and this “potential” is slowing down.  (1)  In the 1960’s we could observe a decline in our total factor productivity (TFP) a rather amorphous measurement of our use of labor and capital; (2) Then in the mid 1970’s we could discern a reduction in our potential employment.  Translation: The work force was getting older, and the number of women entering the work force has leveled out.  In the 1950’s only about 1 in 3 women were working in the U.S., by 2010 women comprised approximately 47% of the total U.S. employment. [BLS] (3) Long term unemployment, associated with this prolonged recovery, means that skills and knowledge levels erode further exacerbating the employment situation. [CBO pdf]

Fourth, there’s the old stickler — You can’t spend much more than you have.   Otherwise known as wage stagnation:

    “Between 2002 and 2012, wages were stagnant or declined for the entire bottom 70 percent of the wage distribution. In other words, the vast majority of wage earners have already experienced a lost decade, one where real wages were either flat or in decline.

This lost decade for wages comes on the heels of decades of inadequate wage growth. For virtually the entire period since 1979 (with the one exception being the strong wage growth of the late 1990s), wage growth for most workers has been weak. The median worker saw an increase of just 5 percent between 1979 and 2012, despite productivity growth of 74.5 percent — while the 20th percentile worker saw wage erosion of 0.4 percent and the 80th percentile worker saw wage growth of just 17.5 percent.”  [NYT]

Now, consider a situation in which a monetary policy solution is questionable because the (a)  Fed can’t lower its rates much further to stimulate economic growth, (b) consumer demand drops off as families try to paid down household debt, (c) we’ve just about incorporated everyone we can into the labor force without resorting to child labor and the exploitation of the elderly, and (d) there’s been a lost decade in terms of wage growth already, and things aren’t looking up in that department.   This is hardly a formula for encouraging vacationers to leave it in Las Vegas.

The hard and unavoidable conclusion is that Nevada desperately needs more people willing to spend more money on good old fashioned fun and games.  The UNLV Center for Business and Economic Research (pdf) puts this statement far more elegantly.

Solutions?

Here are some possibilities to consider:  (1) Forget trying to tinker with the Federal Funds Rate and concentrate instead on a manufacturing policy.  We don’t have to be “protectionist” or “isolationists” to consider the possibility that it would enhance our overall economy if we made stuff.  We don’t necessarily have to recoup our manufacturing of frying pans if we’d concentrate on manufacturing better and more energy efficient stoves.

(2) Increase the minimum wage.   But, how the so-called representatives of ‘small business’ (like the U.S. Chamber of Commerce?) will bellow about this one — It’s a job killer?  Remember what the Number One issue was for small business during the last recession?  Demand!  It wasn’t tax policy, monetary policy, or stringent lending, it was good old fashioned demand.   People with more money in their bank accounts want more and spend more — and that’s the very definition of demand.  And, as a side benefit, if we want to reduce the number of American families who require public assistance to meet their daily needs for food and housing — how about making it a living wage?

(3) Empower the labor force.  This doesn’t necessarily mean making organizing more convenient, although that would serve to increase earnings.  It can also mean supporting those who wish to improve their skills or learn new ones in educational institutions or technical training.   How might we all benefit if student loans were even more affordable?  If apprenticeship and other training programs were subsidized? If community college associate degree programs were adequately funded?   If we invested in our own work force?

In short, we can settle for the slow growth economic predictions informed by stagnating wages, increasing income inequality gaps, debilitating student indebtedness, the marginalization of our manufacturing sector, and the altogether too common fear of long term unemployment — OR we can DO something about it. Now, can we talk about passing JOBS bills?

Comments Off on Nevada Unemployment: Now can we talk about jobs?

Filed under Economy, Nevada, Nevada economy, Nevada politics, Politics

Nevada and the Silli-Quester in the Mythical Land of Moonshine

MoonlightHappy News:Annual adjustments to Nevada’s labor market show the state’s unemployment rate for 2012 dropped from a preliminary estimate of 11.6 percent to 11.1 percent and that Nevada gained 18,100 in employment over the year, up from the previous estimate of 9,300.” [DETR pdf] A graph of Nevada unemployment rates for the past five years shows:

Nevada Unemployment five year

The current rate is reported as 10.2%.   The Nevada YOY employment growth rate is 1.7%. [DETR]  Any improvement is acceptable, but more would obviously be better.  Unemployed workers curtail spending — a drag on local retail economies, and unemployed workers who curtail spending pay less in sales taxes.   The improvement in employment figures during 2012 showed up in the state sales tax information:

“Statewide taxable sales for December 2012 of $4,343,847,392 represents a 3.0% increase over December 2011 and a 5.1% increase for the fiscal year.  The largest increases in statewide taxable sales were realized by Food Services and Drinking Places, up 5.4%; Specialty Trade Contractors, up 60.9%; Motor Vehicle and Parts Dealers, up 10.0%; Clothing and Clothing Accessories Stores, up 5.9%; and Telecommunications, up 38.2%.”  [NDT Dec 2012]

Now we can get to the philosophical part.  A state which reduces its spending not only reduces the level of service to its citizens, but it also constrains the aggregate demand in its own economy.   As of 2010 Nevada ranked 32nd in the nation as categorized by state GDP ($127.5M).  The budget proposed by Governor Sandoval restores some hiring, reduces furloughs, and addresses some infrastructure needs. [pdf download]  We’ll be paying for this with a relatively regressive tax structure.

Nevada Revenue 2012(Full Size Chart click here (pdf)]

Nevada Revenue 2012 chart

Operating grants are funds from federal sources.  The “other” taxes are the Modified Business Tax, insurance taxes, and property related taxation.  We are “pleased” to promote ourselves as a state without personal or corporation income taxation, so we are stuck with taxing sales, property, gaming, and business operations.  All dependent in one way or another on consumer spending.  Be ye rich or poor you’ll spend the same amount for sales tax on a box of bolts.  Further, we’re going to jeopardize our fragile recovery by adopting Austerity Economics at the federal level.

Here comes the Silli-quester part of the puzzle Note the 8.09% drop in federal spending in Nevada since the last budget in the previous chart.  Now, imagine we’re going to use a meat axe to cut this level back even further.  The cuts won’t all come at once, but if the sequestration of funds continues there will be reductions in spending for Title I schools, for nutrition programs, and for other government services.   States with less regressive taxation structures might be able to absorb the reductions with less pain, but Nevada doesn’t have even that minimal luxury.   Its revenues are closely tied to the employment levels both domestically and nationwide.

At this point we need to deal with some conservative mythology which underpins the current demands for federal spending reductions.

#1. The first thing required to create a debt or deficit crisis (and these two things are not synonymous) is to convince the populace we have The Very Worst Debt Crisis Ever In The History Of Humanity.  We don’t.

“In fact, we’ve been here before.  In 2009, the federal budget deficit was a whopping 10.1% of the American economy, and back in 1943, in the midst of World War II, it was three times that — 30.3%. This fiscal year the deficit will total around 7.6%. Yes, that is big. But in the Congressional Budget Office’s grimmest projections, that figure will fall to 6.3% next year, and 5.8% in fiscal 2014. In 1983, under President Reagan, the deficit hit 6% of the economy, and by 1998, that had turned into a surplus. So, while projected deficits remain large, they’re neither historically unprecedented nor insurmountable.”  [Salon]

Notice, that if we do nothing — the deficit will still decline from 7.6% of GDP to 5.8% in FY 2014.  And, it’s hardly the Greatest Worst Thing That’s Ever Happened.   It is, however, the only peg on which the GOP controlled House of Representatives can attempt a bit of hostage taking thanks to the provisions of Article I, Section 7 of our Constitution. “All bills for raising revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other bills.”

#2. ” Our spending, our spending I say, is Out of Control.” Not so much.  Consider this often published chart from Forbes Magazine on federal spending by recent administrations:

Obama spending forbes chart

So, when does 1.4% annualized growth in spending become “out of control” compared to the first Reagan term 8.7%? Or, to the two Bush II administrations rates of 7.3% and 8.1%?

#3. “But, but, but…we’re saddling our grandchildren with DEBT!”  Before the hysteria becomes too cloying, it’s well to remember that federal debt isn’t anything like household debt.  Unless, of course, your household can issue Treasury Bills and Notes which are universally recognized as safe investments.  You and I have creditors.  The United States of America has investors.   And, better still, some of our grandchildren — the ones on whom we have bestowed gifts of Savings Bonds — are some of those investors.  In fact, as of 2011 the Federal Reserve held about 16% of our public debt, state and local governments held about 6%, and domestic and private investors owned 32%. [GAO]

#4. “But, but, but…we’re literally getting owned by China!”  Yes, foreign investors hold the remaining 46% of our public debt, but they have reasons for that which don’t sound like Gloom and Doom.  For example, we are the world’s reserve currency.  The good old U.S. dollar was used in about 80% of all financial transactions in global foreign exchange markets as of April 2011.  That being the case, we can borrow on the Full Faith and Credit of the U.S. to make up for gaps in our own savings rates.

“…an economy open to international trade and investment, such as the United States, essentially can borrow the surplus of savings of other countries to finance more investment than U.S. national saving would permit. The flow of capital into the United States has gone into a variety of assets, including Treasury securities, corporate securities, and direct investment. [GAO]

Further, true to the don’t put all the eggs in one basket rule for investors, our foreign counterparts aren’t pouring all their investment into our public debt, as the following fancy graph from the GAO report demonstrates:

Foreign Investment US

#5.We have to reform entitlement programs or we’ll never get out of this No Good Horrible Debt.”   Not. So. Fast.   Now, we’re getting down to the core  part of the conservative strategy.  “Reform” in that context means Privatize.   Let’s dispense with the Social Security part of the issue first.

“…today the Social Security trust funds hold $2.8 trillion in government bonds. These reserves have been built up with the contributions that workers and employers have paid into the system for the dedicated purpose of paying Social Security benefits. These funds are held in legally established trusts and cannot be used for any purpose other than paying benefits. According to the latest Trustees’ report, Social Security can pay full benefits through 2033, and roughly 75 percent of benefits beyond that time.”  [AARP]

Those bonds are non-commercial, highest priority Treasuries not available to Wall Street Bettors and Traders.  Social Security adds not one thin dime to our national debt, and therefore, as President Ronald Reagan once stated, should NOT be part of any “deficit reform” package. [PoliticusUSA] If we’d like to make the system even more secure there’s always the option of raising the cap on earnings subject to Social Security. [EPI]

“But, but, but… there’s nothing but IOU’s in the Social Security Trust Funds.”  I’d like to get some of those IOUs… but as a private investor I can’t.  They are privileged funding sources for the Social Security Administration and I can’t play with them in the equities markets.   The SSA phrases this more elegantly.

“There can be no question that the Federal old-age and survivors insurance and disability insurance trust funds and the Board of Trustees of those funds were created by and are subject to laws enacted by the Congress of the United States. To that extent, they are a part of the United States Government. These funds, however, are entities separate from and independent of the rest of the Federal Government. The income and disbursements of the funds are not included in the administrative budget of the Government. Instead, the President reports their operations separately in his Budget Message to Congress and the Board of Trustees is required to submit to Congress annually a report on the operations and status of the funds. The debt obligations held by the trust funds are shown in Treasury reports as part of the Federal debt, and interest payments on these obligations are regularly made by the Treasury to the trust funds. They are redeemed in cash by the Treasury whenever necessary for disbursements by these funds. (emphasis added) [SSA]

#6.But, but, but, Medicare is going broke!”   Medicare does have problems, the worst of which are rising costs of health care in the United States.  To wit, the conservatives offer the following canard — Obamacare endangers Medicare.  No, actually it doesn’t.   If by “endangerment” one means that the Affordable Care Act provisions have saved the popular program about $6 billion in drug costs — then let’s have more endangerment, please. [HuffPo]

And if by endangerment, one means that the provisions of the Affordable Care Act are beginning to bend the curve on rising health care costs, then let’s have more:

“Douglas Elmendorf, Director of the CBO, noted that while much of the savings are the result of a loss of wealth due to the recession. But, for the first time, Elmendorf was willing to say that a ‘significant part’ of the savings are the result of structural change in how healthcare is now being delivered.” [Forbes]

We might also want to consider allowing the Department of Health and Human Services negotiate for Medicare supported prescription drugs?  Or, we could pause a moment from the current hysteria, and allow some of the provisions of the ACA to kick in, and support the efforts of the Administration to curb Medicare fraud and abuse.

“According to the Congressional Budget Office, this health-reform legislation will reduce budget deficits by $119 billion between now and 2019.  And only around 1% of American households will end up paying a penalty for lacking health insurance.

While the Affordable Care Act is hardly a panacea for the many problems in U.S. health care, it does at least start to address the pressing issue of rising costs — and it incorporates some of the best wisdom on how to do so. Health-policy experts have explored phasing out the fee-for-service payment system — in which doctors are paid for each test and procedure they perform — in favor of something akin to pay-for-performance. This transition would reward medical professionals for delivering more effective, coordinated, and efficient care — and save a lot of money by reducing waste.” [Salon]

A reduction in the deficit of $119 billion by 2019 sounds like we’re headed in the right direction — without privatization or voucherization or whatever the popular conservative term of the day might be.

Moonshine

In the dark world of conservative TeaParty GOP thinking, Nevada and 49 other states will have to absorb a reduction in federal spending — thus crimping their already strained budgets — because of a debt crisis that really isn’t critical, deficits which are NOT out of control but are actually declining, and social safety net programs which are (a) not adding anything to the Hideous Heinous Debt, or (b) being reformed without resorting to radical prescriptions like privatization or voucherization.

The current caterwauling by the GOP about the deficit or the debt is part and parcel of the only way they can obstruct the Obama Administration — using the appropriation  powers granted unto them in the House of Representatives.  They will hold the national economy hostage in their own moonlit nightmare of irrelevance, clutching the only cudgel at hand.

Comments Off on Nevada and the Silli-Quester in the Mythical Land of Moonshine

Filed under Economy, Medicare, Nevada economy, Nevada politics, nevada taxation, Social Security