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Thursday, March 30, 2017

H.R.1275 - World's Greatest Healthcare Plan of 2017

The name of this bill is certainly full of itself but do the contents live up to the name?

The bill is extensive. Due to its complexity and multiple references to large portion of US Code I will base my analysis on the summary provided for the bill about its intent and actions.

1) Stated: "This bill amends the Internal Revenue Code to repeal the requirements for individuals to maintain minimum essential coverage and for large employers to offer affordable coverage to full time employees."

Meaning: Individuals will once again be able to gamble with their health by sacrificing health insurance to pay for other things. It also allows large employers to deny health benefits to their employees. Considering employers often obtain better deals on insurance by enrolling in group health care plans this will likely result in greater costs to their employees wishing to maintain their health benefits.

2) Stated: "Health insurance is no longer required to cover preventive care at no cost or include the essential health benefits."

Meaning: A greater number of people will postpone preventative care for financial reasons resulting in increased long term medical complications and costs. Also, insurers will be allowed to cut costs by offering plans that do not provide for the whole body care of an individual. This includes removing provisions for things such as prenatal, labs, pediatrics, etc.

3) Stated: "Individuals enrolling in health insurance who have not maintained continuous coverage over the previous 12 months are charged an extra 20% on premiums for each consecutive year without coverage, unless the individual is subject to similar state incentives to maintain coverage."

Meaning: This measure appears counterproductive as those who have already suffered a lapse of coverage will now face a significant financial burden when they are ready to regain health insurance. Instead of encouraging people to maintain coverage from the start this will only discourage people from re-enrolling once they are in a financial position to do so.

4) Stated: "States may enroll uninsured residents in high deductible health plans. Individuals must be permitted to opt-out of this coverage."

Meaning: States may offer residents emergency only health plans which provides no incentive for individuals to maintain regular preventative care and are likely to result in increased long term medical complications due to the postponement of treatment for financial reasons.

5) Stated: "The Department of Health and Human Services (HHS) must develop a risk adjustment mechanism for health insurance in the individual market."

Meaning: Helps offset costs to insurers providing coverage for high risk individuals

6) Stated: "For residents of a state to qualify for premium subsidies or the health insurance tax credit in this bill, the state must permit health insurance with an annual limit on benefits to be sold on its exchange."

Meaning: Allows insurers to put an annual cap on benefits which negatively effects those with severe or chronic illnesses requiring expensive treatments or medication. States are forced to allow this if they wish for their residents to receive federal subsidies and tax credits.

7) Stated: "The bill establishes an advanceable, refundable health insurance tax credit for taxpayers enrolled in coverage that does not cover abortion except in certain circumstances."

Meaning: Gives a monetary incentive for taxpayers to enroll in plans that do not cover abortion.

8) Stated: "States may: (1) apply to HHS to use unclaimed health insurance tax credits for indigent health care; and (2) enroll Medicaid-eligible individuals in health insurance that qualifies for the tax credit instead of in Medicaid, at the individual's option."

Meaning: Part one is absurd in that, if all the credits are claimed, there will be no funds for states to provide indigent care. Part two gives residents an option between Medicaid and traditional health insurance but may fail based on the quality of coverage provided

9) Stated: "The tax on excess health benefits (commonly called the Cadillac tax) is repealed."

Meaning: Removes the additional tax on most expensive health plans.

10) Stated: "The bill establishes Roth HSAs (health savings accounts) for paying certain medical expenses and health insurance premiums."

Meaning: Health Savings Accounts are commonly encouraged as a way to offset the costs of insufficient insurance however for low income individuals who do not have the capability of putting funds aside in advance this is an impractical measure.

11) Stated: "The tax deduction for medical expenses is eliminated."

Meaning: Those who spend a large amount of money out of pocket for medical expenses will no longer be able to recoup some of those costs at tax time. This, once again, will negatively impact low income individuals with little or no insurance who suffer a medical hardship.

12) Stated: "This bill amends title XIX (Medicaid) and title XVIII (Medicare) of the Social Security Act, including to turn federal Medicaid payments into block grants."

Meaning: Turning Medicaid into block grants will mean the disbursement and administration of said funds will be entirely in the hand of the States. This reduces the consistency and accountability of the Medicaid program.

Taken as a whole, there are a few good things found in this bill but overall it will disadvantage low income and chronically ill individuals while providing greater profits to insurance companies. I rank this bill better than Trump's proposal but definitely not what America needs.

Friday, March 24, 2017

Live Long and Prosper

Without a doubt healthcare in America is a shameful thing. We come in last among developed nations when it comes to cost, efficiency, equity, and healthy living. We have a lower life expectancy and higher infant mortality than comparable countries. The US has even seen an increase in maternal mortality rate while world wide the rate has declined.

The Affordable Care Act (ACA), commonly referred to as Obamacare, was the first major effort in recent history to counteract these trends. It made inroads into the problem by improving access to health insurance for large portions of the population that had previously been ineligible or unable to afford it. Increased subsidies provided financial assistance to poor and middle class individuals. Parental coverage was extended to the age of 26. And preexisting conditions could no longer be grounds for denial or increased premium rates. This legislation also mandated minimum coverage, meaning that insurers could no longer offer plans that lacked basic provisions for care.

Trump may not have realized until recently but healthcare in America is, and has been for years, a very complicated issue. There are employer plans, private insurance, VA programs, Medicare, Medicaid, and CHIP, in addition to state run programs that don't always work together and sometimes even compete with each other. There is also the discrepancy in Federal and State standards which can be more or less restrictive. Environmental and social factors should also be taken into account when considering the state of health, and healthcare, in our nation.

It should also be taken into account that the vast majority of our healthcare system is a for profit industry. What this means at the most basic level is that insurers are primarily concerned with the generation of profits, not the well being of those they cover. Their desire is to create the greatest amount of revenue with the least amount of expenditure. Since revenue, on some level, is limited by the laws of supply and demand reducing expenditure is the easiest way to increase profits. While streamlining office procedures can reduce some expenditures that greatest portion of insurer expenses are for covered services which leads to the logical conclusion that, to increase profits, there will be a decrease in services. In fact, generally speaking, insurance will seek to cover the least amount of claims possible. This is evidenced by the pre-ACA practice of denying coverage or only offering extraordinarily high premium rates to those with preexisting conditions (i.e. those who would necessarily require more than the bare minimum of services).

Trump's solution, which appears to have failed at this time, would have reset much of our system to pre-ACA levels. However, instead of rehashing the few pros and many cons of his plan, I would like to instead take some time and envision a brighter future for American healthcare.

In its ideal form a healthcare system should be one that's primary goal is the short and long term full body health of all covered individuals. Whether it is a minor stomach bug or a chronic, debilitating illness every individual should have access to the appropriate doctors, medicine, testing, and treatments for their condition. By full body I mean not just physical care but also care for the mental and emotional well being of a person. This access should be regardless of the age of the individual or cost of care. All of this boils down to creating a plan that has the goal of patient health, the scope of full body care, and equitable access for all.

Of these three areas the goal is the easiest to solve. Our current system, as mentioned above, is concerned primarily with profits rather than patient health so it fails the first test. Next is the debate of private sector nonprofit or government run. The problem with private sector nonprofit is an issue of stable funding and ideological differences. Many nonprofits receive government funds already or must rely on private donors. Should a nonprofit's funding fail it is those they cover who will suffer. Member contributions can provide some stability but income differences can make this inaccessible to those without funds to contribute. Ideological differences, on the other hand, can take many forms. As a few examples, a Scientologist run network could exclude all mental health services, a Catholic run program may offer no forms of contraceptive (even pills and condoms), a new age philanthropist could start a service that insists all illness must be cured by targeted meditation and offer no other services. These are extreme examples, but patients should not be limited to one philosophy of care, and should especially not be influenced by religious ideals (I will discuss this more when I talk about access). The government, on the other hand, should provide neutral ground for medical philosophies and should also have a stable funding base. As for the question of State vs. Federal I would argue that the Federal government is in the best position to institute minimum standards while the States would be allowed (from their own tax revenues) to institute and provide greater coverage if, where and how they choose.

A trickier subject is scope of care. There are obvious things that should be covered such as preventative care, cancer treatment, etc. And there are things that obviously should not such as cosmetic surgeries not prompted by an injury or other elective treatments. But then come the gray zones. How crooked do your teeth need to be before braces are covered? If you need glasses how much of the frame cost should be covered? And what about alternative treatments? Acupuncture? Massage? Chiropractic? In general I would allow physicians the flexibility to prescribe the treatments they feel are best for their patients and to make the call on whether a procedure is purely cosmetic or medically necessary. For the most difficult of decisions, such as cases for treatments that are alternative or still in testing, I would suggest a review panel but only if said review panel was able to give decisions without requiring patients to suffer through excessive waiting periods. The problems that have been discovered with the VA serve as an excellent cautionary tale on this front. In general I would insist upon basic coverage for medical, dental, vision, and psychiatric care. This would include prescription coverage, emergency services, lab work, maternity and pediatric care, rehabilitation services, etc.

Finally we come to equitable access for all. What I mean by all is every American regardless of age, race, national origin, religion, sex, gender, sexual orientation, familial status, you get the picture. Now obviously every person's health status is different. Not just for the obvious differences I've stated above but also due to environmental circumstances, unique genetic traits, socio-economic conditions, and the list could go on. When I talk about equitable care what I mean is that every individual's experience with the health care system should be the same. The poor black family living in a rural, economically depressed region should be able to get the same care and individual attention as a rich white family living in New York. If someone wants to pay additional money out of their own pocket for elective procedures that is their choice, but no American should ever have to choose between filling a prescription and putting food on the table. On the flip side, just because certain treatments are offered does not require an individual to take advantage of them. There are millions of Catholics who choose not to use birth control even though surely many of their medical plans cover it. A Scientologist is not obligated, unless they are seen as a danger to themselves or others, to seek psychiatric care. And if someone believes that meditation will heal all ills that doesn't negate their access to traditional medicine. However, this must also mean that health care professionals can not use religious or moral exemptions to get out of discussing, let alone providing, medicine that would be considered a normal part of their professional activity. If too many providers in a particular area exempted themselves from certain treatments it could cause an undue burden on patients and limit their access to the health care they deserve. Also, as a professional, patients expect to be able to trust them to give the best medical opinion, which should be the case even when that opinion conflicts with a personal view.

When we talk about healthcare too often we obsess about the dollars and cents. The reality is that much of the developed world provides universal healthcare to their citizens. Some of these systems work better than others but we can not deny the fact that they work and that their citizens are better off, as a whole, because of it. I will paraphrase a quote I saw once from a Canadian about their health care system:
I don't see anything wrong with paying a few extra dollars so that an 8-year-old across the country can have heart surgery

Too bad we can't all have this outlook on life.

Saturday, March 18, 2017

Fiscal Year 2017

The President has just released a partial budget proposal for the 2018 fiscal year and I have taken the last few days to examine just what it entails. The President's message at the beginning of this proposal states the following:
Our aim is to meet the simple, but crucial demand of our citizens- a Government that puts the needs of it's own people first. When we do that, we will set free the dreams of every American, and we will begin a new chapter of American greatness.
Today I will endeavor to show just what the President means by our "own people" and how he thinks he can "set free the dreams of every American." You be the judge...

Because of it's length I have included my full synopsis of the budget proposal at the end of this post. For my actual analysis I would like to highlight my top 5 concerns with this budget:

1) Fear tactic defense spending
2) Threats to the poor, seniors, and people with disabilities
3) Reckless environmental actions
4) Dissolution of public education
5) Disintegration of arts and sciences

Here is my analysis:

1) Fear tactic defense spending

One of the most basic and agreed upon responsibilities of the Federal government is to provide for a national defense. That being said, the US already has the greatest military spending in the world by a substantial margin. In fact, we spend more to fund our military than the next 7 countries combined, 34% of the world's military spending. While every other area on the budget has significant emphasis on efficiency and reducing redundancy this seemingly does not apply to defense spending.

I have no issues with the comparatively moderate increases to the Department of Veteran's Affairs, but the Department of Defense already has nearly 10 times the budget of the next largest department and is set to receive an additional 10% boost to funding. If there was any area where efficiency and redundancy should be looked at for cost saving measures it should be here. However, that is apparently not the President's plan. The President's obsession with winning has resulted in him stating:
Lays the groundwork for a larger, more capable, and more lethal joint force, driven by... the need for American superiority not only on land, at sea, in the air, and in space, but also in cyberspace.
This choice of words is chilling to me. Even in military operations more death should never be the objective. He states further on that the investment of more Navy ships is only a "down payment" suggesting that there is much more to come.

He keeps pressing this idea of how insecure our nation is but, I don't know about you, but I don't feel unsafe or in imminent threat from foreigners. Granted, I don't have access to top secret threat analysis data, but we will never be 100% secure and, while prevention is important, strength at home can mean a lot more than military might. Investments in education, infrastructure, and health care can go a lot farther towards improving the daily quality of life for Americans than stockpiling weapons for some vague possibility of threat. The President's proposed increase in military spending to the detriment of other fundamental programs does not speak of a man wishing to "make America great" it says to me that he wants to keep America in fear.

People living in fear find it harder to make rational decisions and are more easily provoked. Teaching the American people to live in fear, which seems to be the President's plan, puts us at risk of turning against each other. It is essential for communities to band together for their own betterment and be constantly critical of the real reason the President wants such a large military power under his control.

2) Threats to the poor, seniors, and people with disabilities

The President's plan calls for substantial cuts to programs that assist the poor, seniors, and people with disabilities. Just a partial list includes the following:

Eliminates:
-Economic Development Administration- encourages economic development in depressed regions
-Federal Supplemental Education Opportunity Grant- grants to college students with financial need
-Low Income Home Energy Assistance- assists families with energy costs
-Community Services Block Grant- funds programs for low-income individuals
-Community Development Block Grant- for the development of viable urban communities
-Capacity Building for Community Development and Affordable Housing- assists communities in developing affordable housing
-HOME Investment Partnerships Program- low-income housing assistance
-Choice Neighborhoods- assisting struggling neighborhoods
-Self-help Homeownership Opportunity Program- grants to non profits who build low-income housing
-Senior Community Service Employment Program- job training for low-income, unemployed seniors

Reduces:
WIC
Work study
Department of Health and Human Services
Job training grants
Office of Disability Employment Policy
Job Corp

Also, while the budget protects funding to IDEA, which is an agency to protect disabled students under the Department of Education, the institution of vouchers, also outlined in the budget, will put disabled students at risk (see my previous post on education vouchers here). There is also the proposed health care bill, which I have not yet covered but seems to be implied in the substantial cuts to the Department of Health and Human Services, which may result in millions of Americans losing their coverage.

The justification for much of these cuts seems to fall into one of two categories: reducing overlap or that a program is better provided by the states. The former excuse fails on two fronts as many grant programs have specific requirements with slight variations that mean organizations qualify for some but not others though at first look the grants may appear to overlap each other in purpose. It also fails in that it reduces overlap but fails to supplement the remaining programs to ensure continued coverage. The secondary excuse fails because states will be required to make up for the loss of Federal funding which will result in an increase in American taxes on the state level or cuts to programs. In any case these cuts will most likely have a direct impact on some of America's most vulnerable citizens

3) Reckless environmental actions

Not much needs to be said on this front. The President has made it clear that he plans to take no action to prevent climate change and has outlined said goals in his budget. He has also set forth in his budget to strip much of the EPA and give authority instead to the states. Considering there are several bills currently pending in Congress to allow states to permit things like fracking this is a dangerous trend. The actions of one state on the environment can have an effect on the entire nation and so it is important that as a nation we stand together on environmental issues.

4) Dissolution of education system

I have already posted at length about the dangers of voucher programs and much of the threat in the current budget comes from stripping the Department of Education and putting funds instead into so called school choice programs. The budget goes further however in reducing grants and work study programs for college students and doing away with other training programs that insure the public receives quality education to be productive members of society.

5) Disintegration of arts and sciences

Related to education but serving a separate roll, the President seems intent on removing all arts and sciences from the national scene. Between reducing or completely eliminating funding for the Corporation for Public Broadcasting, the National Endowment for the Arts, the National Endowment for the Humanities, public libraries, national heritage areas, and wildlife refuges among other programs he is dismantling much of the vibrancy of our nation. Some, possibly many, of these programs will survive, but the cost will be an additional financial burden at the state and local level with no reduction of Federal obligations.

My final thoughts as I turn you over to my lengthy synopsis are these:

If the President's goal is to make America great his budget is misguided at best, dangerous at worst. National defense is important but without real justification to increase spending the precious dollars in the hands of our government should be going to grow our economy and infrastructure and protect the most vulnerable among us. We need to tell Congress and the President that they can, and in fact must, do better.

Proposed Budget Synopsis

Department of Agriculture
- $4.7 billion reduction (21%)
- Fully funds Food Safety and Inspection Service
- $6.2 billion to WIC (reduction of $400 million)
- $2.4 wildland fire preparedness and suppression- fully funded
- Reduces funding for National Forest System "lower priority activities"
- $350 million for farmer-focused research
- Reduces funding for statistical capabilities while maintaining funding for the Census for Agriculture
- Eliminates duplicate water and wastewater loan and grant program ($498 million) stating that rural communities can be serviced by the private sector or other funds such as the EPA's State Revolving Funds
- Reduce staffing to the USDA Service Center Agencies to reflect reduced workload and encourage private sector conservation
- Eliminate discretionary activities of the Rural Business and Cooperative Service ($95 million)
- Eliminate McGovern-Dole International Food for Education

Department of Commerce
- $1.5 billion reduction (16%)
- Strengthen International Trade Administration enforcement and compliance functions while reducing export promotion and trade analysis
- Increase of $100 million to Census Bureau to prepare for the 2020 Census
- Consolidates parts of the Economics and Statistics Administration, US Census Bureau, and Department of Commerce's Office of the Secretary
- Eliminate Economic Development Administration ($221 million)
- Eliminates the Minority Business Development Agency
- Discontinue Manufacturing Extension Partnership Program ($124 million)
- Eliminates certain National Oceanic and Atmospheric Administration grants and programs ($250 million)
- Maintains polar orbiting and geostationary satellites for weather forecasting
- Savings from the Polar Follow On program by utilizing commercial data
- Maintains National Weather Service forecasting with $1 billion in investments
- Maintains National Telecommunication and Information Administration

Department of Defense
- $52 billion increase (10%)
- Repeal of defense sequestration plus an additional $2 billion in funding
- Providing resources to "accelerate the defeat of ISIS"
- Use funds for war fighting readiness
- Increase/improve training, equipment, and infrastructure
- "Lays the groundwork for a larger, more capable, and more lethal joint force"
- Reduce cost of military programs wherever "feasible"
- Rebuild readiness of US Army
- Increase number of Navy ships- "This budget reflects a down payment on the President's commitment to expanding the fleet"
- Ensure a ready and fully equipped Marine Corps
- Invest in Air Force maintenance, training, and additional F-35 Joint Strike Firghters

Department of Education
- $9 billion reduction (13%)
- Increase funding for school choice such as private and charter schools ($1.4 billion)
- Maintains current IDEA funding for students with disabilities
- Eliminates Supporting Effective Instruction State Grants program ($2.4 billion)
- Eliminates 21st Century Community Learning Centers program ($1.2 billion)
- Eliminates Federal Supplemental Educational Opportunity Grant ($732 million)
- Maintains the Pell Grant while cancelling $3.9 billion in unobligated carryover funding
- Maintains funding for programs that serve high percentage minority students
- Significant reduction to Federal Work Study
- Reduce Federal TRIO Programs and GEAR UP (reduction of $193 million)
- Reduce or eliminate over 20 additional programs including Striving Readers, Teacher Quality Partnership, Impact Aid Support Payments for Federal Property, and International Education programs

Department of Energy
- $1.7 billion reduction (5.6%) however a $1.4 billion increase to the National Nuclear Security Administration (11%)
- Restart Yucca Mountain nuclear waste repository ($120 million)
- Eliminate defense sequestration for the National Nuclear Security Administration
- $6.5 billion to the Environmental Management program to clean up nuclear waste
- Eliminates the Advanced Research Projects Agency-Energy, Title 17 Innovative Technology Loan Guarantee Program, and the Advanced Technology Vehicle Manufacturing Program
- Prioritization of projects within the Office of Science (reduction of $900 million)
- Limits scope of the Office of Energy Efficiency and Renewable Energy, the Office of Nuclear Energy, the Office of Electricity Delivery and Energy Reliability, and the Fossil Energy Research and Development program as well as eliminating the Weatherization Assistance Program and State Energy Program (reduction of $2 billion)
- Support cyber security  and grid resiliency within the Office of Electricity Delivery and Energy Reliability
- Continues and enhances research, development, and construction of expanded Navy fleet

Department of Health and Human Services
- $15.1 billion reduction (17.9%)
- Maintain direct health care services such as community health centers
- Increase Health Care Fraud and Abuse Program funding by $70 million
- Support "efficient operations" of Medicare, Medicaid, and the Children's Health Insurance Program
- Increase opioid misuse prevention efforts and access to treatment and recovery services ($500 million)
- Increase the FDA medical product user fees (revenue increase of $1 billion)
- Reduce National Institute of Health ($5.8 billion) including eliminating the Fogarty International Center and consolidating the Agency for Healthcare Research and Quality
- Creates a new Federal Emergency Response Fund and a new $500 million block grant within the CDC
- Invest in "high-performing entities" to focus on "high priority" mental health activities
- Eliminate some health and nurse training programs ($403 million)
- Eliminate discretionary programs in the Office of Community Service including the Low Income Home Energy Assistance Program and the Community Services Block Grant ($4.2 billion)

Department of Homeland Security
- $2.8 billion increase (6.8%)
- $2.6 billion for border security technology including planning of a border wall
- $324 million to recruit, hire, and train Border Patrol, ICE Agents, and support staff
- Increase funding for detention, transport, and removal of illegal immigrants ($1.5 billion)
- Mandatory implementation of nationwide E-Verify usage for employers ($15 million)
- Safeguard cyber space ($1.5 billion)
- Increase Passenger Security Fee to recover 75% of TSA operation costs and eliminate NFIP's Flood Hazard Mapping Program ($190 million)
- Eliminate or reduce FEMA state and local grant funding and require a 25% non-Federal cost match for preparedness grants ($667 million)
- Eliminate or reduce certain TSA programs ($80 million)

Department of Housing and Urban Development
- $6.2 billion reduction (13.2%)
- Provides $35 billion for HUD rental assistance programs
- Eliminates the Community Development Block Grant ($3 billion)
- Eliminate "low priority" programs such as HOME Investment Partnerships Program, Choice Neighborhoods, and the Self-help Homeownership Opportunity Program ($1.1 billion)
- Increase funding to promote lead-safe homes ($20 million)
- Eliminate Section 4 Capacity Building for Community Development and Affordable Housing ($35 million)
- Support FHA mortgage insurance programs

Department of the Interior
- $1.5 billion reduction (12%)
- Increase funding to develop energy on public land and streamline permitting
- Maintains Office of Natural Resources Revenue
- Eliminates "lower priority" programs including Abandoned Mine Land grants, National Heritage Areas, and National Wildlife Refuge payments
- Maintains "stewardship capacity" operations for National Park Service, Fish and Wildlife Service, and Bureau of Land Management
- Maintains tribal sovereignty and self-determination but reduces funds for "more recent" projects and initiatives that only serve a few tribes
- Reduces funds for land acquisition ($120 million)
- Increases funding for deferred maintenance but overall reduces funds for construction and major maintenance programs in National Park Service
- Provides $900 million for US Geological Survey
- Public/private matching plan for wildlife conservation, historic preservation, and recreation grants
- Maintain wildland fire suppression funding
- $1 billion for water resource management in western US
- Minor reduction to Payments in Lieu of Taxes program

Department of Justice
- $1.1 billion reduction (3.8%)
- Increase FBI funding ($249 million)
- Increase law enforcement component funding ($175 million)
- Link prosecutors and intelligence attorneys with investigations and the intelligence community
- Increase number of immigration judges ($80 million)
- Increase number of border enforcement prosecutors and deputy US Marshals
- Increase number of attorneys for immigration legislation and for obtaining land for border wall
- Increases detention space ($171 million)
- Maintain grants to protect state, local, and tribal law enforcement as well as grants for victims of crime
- Eliminates outdated programs ($700 million)
- Reduce prison construction spending (estimated almost $1 billion) however, provides $80 million for prison activation and $113 million for repair and modernization (Net reduction estimate of $800 million)
- Increase bankruptcy-filing fees ($150 million in increased revenue)

Department of Labor
- $2.5 billion reduction (21%)
- Expands Reemployment and Eligibility Assessments
- Reduce certain job training grants including elimination of the Senior Community Service Employment Program ($434 million)
- Eliminates Bureau of International Labor Affairs grant funding ($60 million)
- Closes low performing Job Corps locations
- Decreases funding for job training and employment services
- Fund states to expand apprenticeships
- Refocus the Office of Disability Employment Policy with less funding for technical assistance grants and more funding for early intervention projects
- Eliminates OSHA training grants ($11 million)

Department of State, USAID, and Treasury International Programs
- $10.1 billion reduction (28%) for Department of State and USAID, $12 billion to fund Overseas Contingency Operations, and $803 million reduction (35%) for Treasury International Programs
- Maintains embassy security and core diplomatic functions with $2.2 billion towards embassy construction and maintenance
- Increases funding to $3.1 billion for Israel security assistance
- Eliminates Global Climate Change Initiative and ends all funding to UN climate change programs
- Maintains funds to Gavi, the Vaccine Alliance
- Maintains funding for AIDS, Tuberculosis, and Malaria programs
- Turn some foreign assistance from grants to loans
- Reduce funding for international peacekeeping operations, cap contributions to UN at 25% of peacekeeping costs
- Adjust economic and development assistance to countries that are of greater strategic importance to the US
- Eliminates Emergency Refugee and Migration Assistance
- Reduces funding to Educational and Cultural Exchange programs and focuses remaining funds on the Fulbright Program
- Eliminates certain peacekeeping and security building efforts including the Complex Crisis Fund and small organizations that also have non Federal funds such as the East-West Center
- Consolidates and Reorganizes the DOS and USAID
- Reduces funding of development banks such as the World Bank ($650 million over 3 years)

Department of Transportation
- $2.4 billion reduction (13%)
- Privatize air traffic control
- Reduce Amtrak subsidies, particularly those associated with long distance service
- Only allocate funds for currently approved grants under the Capital Investment Program (New Starts)
- Eliminates Essential Air Service funding ($175 million)
- Eliminates TIGER grant program ($499 million)

Department of the Treasury
- $519 million reduction (4.1%)
- Preserve IRS funding but reduce paper based review ($239 million)
- Enhance cyber security capabilities
- Prioritize funds for economic enforcement tools
- Eliminate Community Development Financial Institutions Fund grants ($210 million)
- End taxpayer bailouts and advance financial regulatory reform
- Reduce federal workforce

Department of Veterans Affairs
- $4.4 billion increase (6%)
- Increase $4.6 billion to improve VA health care
- Extend and fund Veterans Choice Program- set to expire in August 2017
- Fund programs to aid homeless and at-risk veterans
- Fund programs to assist veterans transitioning to civilian life
- Continue funding efforts to optimize the VA claims process
- Fund IT systems to improve quality of services

Environmental Protection Agency
- $2.6 billion reduction (31%) including the elimination of 3,200 jobs
- Marginal increase to funding for drinking and wastewater infrastructure including the State Revolving Funds and Water Infrastructure Finance and Innovation Act ($4 million)
- Defunds the Clean Power Plan and climate change initiatives ($100 million)
- Reduce Hazardous Substance Superfund Account ($330 million)
- Reduce EPA enforcement budget to focus on programs not delegated to the States ($419 million)
- Reduce Office of Research and Development activities by half ($233 million)
- Reduce Categorical Grants ($482 million)
- Eliminate region specific efforts such as Great Lakes Restoration Initiative and Chesapeake Bay ($427 million)
- Eliminates more than 50 additional programs deemed low priority or poorly performing including Energy Star and infrastructure assistance to Alaska Native Villages and the Mexico Border ($347 million)

National Aeronautics and Space Administration
- Funded at $19.1 billion (0.8% decrease)
- Increase use of public-private partnerships
- Allocates $624 million for aeronautics research
- Allocates $1.9 billion for the Planetary Science Program but no funding for a mission to land on Europa
- Allocates $3.7 billion to send astronauts into deep space but cancels the Asteroid Redirect Mission
- Allocates $1.8 billion for Earth science portfolio, eliminates PACE, OCO-3, DSCOVR, and CLARREO missions as well as reducing Earth science grants ($102 million)
- Eliminates Office of Education ($115)
- Restructures robotic satellite refueling demonstration mission ($88 million)
- Strengthen cyber security capabilities

Small Business Administration
- $43.2 million reduction (5%)
- Maintain loan guarantees
- Reduce duplication and coordinate best practices for outreach center programs
- Maintain disaster relief lending
- Eliminate grant programs covered by the private sector ($12 million)
- Provide training and support for transitioning veterans towards business ownership
- Maintain funding for microloan financing
- Ensure SBA can advocate and assist small businesses in accessing government contracts and research opportunities

Saturday, March 11, 2017

Taxed onto Death

Taxes are an unfortunate, necessary evil in organized society with a centralized government. The reality is that laws must be made and enforced, roads built and maintained, treaties with other government negotiated, etc. There is no getting out of the fact that our government must receive money from the people in order to provide the protection and services that it does. In politics, however, there is a substantial debate over what the government (particularly on the Federal level) is responsible to provide and on the flip side how much money they need to carry out their duties. I have touched on the Federal governments responsibilities in the past and will surely discuss it many more times in the future. Today I will be focused purely on where the money comes from to pay for said services. Both the Senate (S.18) and House of Representatives (H.R.25) have bills pending to demolish the IRS and our entire tax system as we know it and put in it's place a national sales tax. This is such a bad idea that it borders on ridiculousness but I plan to unpack this plan in all seriousness to show just how ridiculous it is.

I will be the first to tell you that our current tax system is deeply flawed. It is overly complicated with abundant loop holes. Its convoluted nature makes it nearly impossible for the common man to navigate the best results without help while the rich and savvy exploit the system to avoid paying their fair share. Even when they do pay their fair share those of low income, without government support, are left with no way to save and get ahead. To illustrate this point I will use three different examples: a low income family of four, a middle class couple, and a single person with a high income. I will be relying on the 2015 Consumer Expenditure Survey for much of my data but will be rounding and in some cases adjusting my numbers to the particular cases at hand. Since wages, rents, food costs, etc. vary so dramatically across the nation I have tried to use fairly conservative numbers in the different categories.

Case 1)
A family of four (a couple with 2 children) lives off of a gross income of $30,000 a year. Because they are below the poverty line they pay nothing in taxes. They pay $1,000/month ($12,000 annually) on rent because their family size requires a certain minimum amount of living space. They pay annual utilities of about $3,000 (10% of gross income). They budge $500 a month for food and incidentals ($6,000 annually). They allow no more than $100 per person per year for new clothes and shoes which makes a total of $400 (this number is not only conservative, it is next to impossible to maintain but I'm going to roll with it). They have a single, older car that is paid for but between gas, insurance, and oil changes they spend about $3,000 a year on transportation (this does not include any car repairs that may be needed). Finally the family is fortunate enough to have modest health insurance. They avoid going to the doctor or getting medication unless absolutely necessary but still spend about $3,500 per year in health care costs between insurance premiums, co-pays, and medications. After all of these expenses the family is left with $2,100 for the year. This is their entire budget for any emergencies (medical, car breakdown, appliance replacement, etc.), care of pets, recreation, any overages on their already tight budget, plus any necessary child care over the course of the year. In a perfect world each member of the family could be allocated just over $40 per month for recreation and the family could just break even for the year. There is no room for saving money for a rainy day or for their children's education.

Case 2)
A middle class couple lives off of a gross income of $50,000 a year paying 25% of their income in taxes or about $12,500 annually. They also pay $1,000/month ($12,000 annually) on rent/mortgage but because they require less space they can afford a smaller place in a nicer neighborhood. Like the poorer family they pay 10% of their income on utilities or $5,000 annually. They have the same $500 per month ($6,000 annually) food budget but with only two mouths to feed they can make this budget stretch a lot farther on a wider variety of healthier foods as well as some luxury food items. They also have more money for clothing and can afford a nicer wardrobe at $200 per person annually or $400 total. They have a modest car payment in addition to gas, insurance, and oil changes and pay about $6,000 annually on transportation. Finally, they pay a bit more for a better insurance plan and are comfortable going to the doctor regularly for check ups. They spend about $4,500 annually on healthcare. This leaves $3,600 annually for emergencies, pet care, and recreation. That calculates out to $150 per person per month. This leaves enough money to put a small amount away in savings and still be able to go out and enjoy themselves on occasion. They are better able to take care of their physical and mental health and are less likely to get sick. Also, because they have better insurance coverage they are less likely to be financially devastated in the event of a major illness.

Case 3)
A single individual with a gross income of $100,000 a year pays 30% of their income in taxes or about $30,000 annually. They have a nice home for which they pay $2,000 a month ($24,000 annually). Like the other cases they pay about 10% in utilities or $10,000. They eat well paying an average of $750 a month ($9,000 annually) on food and incidentals. While the poorest family spends $100 per person in a year the wealthy individual spends $100 a month ($1,200 annually) on clothes for themselves. They also drive a fancy car and spend about $15,000 a year on transportation. For health care they have the best coverage available and can afford regular visits for massage and chiropractic at $6,000 a year. Even after all of this luxury the individual still has $4,800 left over at the end of the year for investment, savings, and entertainment.

I've summed up these three circumstances with the graph below:
Family size 4 2 1
Yearly gross income 30,000 50,000 100,000
Taxes paid 0 12,500 30,000
Annual rent/mortgage 12,000 12,000 24,000
Annual utilities 3,000 5,000 10,000
Annual food/incidentals 6,000 6,000 9,000
Annual clothing expenses 400 400 1,200
Annual transportation 3,000 6,000 15,000
Annual medical expenses 3,500 4,500 6,000
Remainder 2,100 3,600 4,800

With all of this data it is no wonder that the rich get richer while the poor are unable to get maintain their current circumstances. When one major illness or an unexpected car repair can devastate your entire financial circumstances you live in constant stress which can negatively impact your long term health and wellness both mentally and physically. It is no wonder that low income families rely on public assistance just to make ends meet. 

This clearly shows how our economic system, including taxes, favors the wealthy and it only gets worse when you look at incomes that range to $1 million and more. A poor family that pays no taxes takes home $30,000 annually. A  single person who makes $100,000 takes home 70% or $70,000. Since our tax brackets cap out at $39.6% for incomes greater than $500,000 a person who grosses $1 million will have a take home of about $600,000. 

Now that I have covered our current tax circumstances let's take a look at the congressional proposal. House Bill 25 and Senate Bill 18 both call for a flat 23% sales tax across the board. There does not seem to be any exceptions for necessary items such as food or health care costs but there is a "Family Consumption Allowance" which consists of a monthly rebate to low income families to offset tax collection. Let's see how this works by the numbers using my previous 3 cases.

Case 1)
A family of four (a couple with 2 children) lives off of a gross income of $30,000 a year. They pay $1,000/month ($12,000 annually) on rent. They pay annual utilities of about $3,000 (10% of gross income). They budge $500 a month for food and incidentals ($6,000 annually). They allow no more than $100 per person per year for new clothes and shoes which makes a total of $400. They spend about $3,000 a year on transportation (this does not include car repairs). They spend about $3,500 per year in health care costs. This means the family's total annual spending is $27,900. At a rate of 23% they would be charged an additional $6,400 for taxes. Which means their actual yearly spending would be $34,300 or more than their yearly income leaving them in perpetual debt. If the family is able to navigate the application process and are approved for the "Family Consumption Allowance" then they would, theoretically, be back to net 0 on taxes with their $2,100 reminder, but this money now has less buying power as they would still be required to pay taxes on any purchases they make with said money.

Case 2)
A middle class couple lives off of a gross income of $50,000 a year. They also pay $1,000/month ($12,000 annually) on rent/mortgage. They pay 10% of their income on utilities or $5,000 annually. They have the same $500 per month ($6,000 annually) food budget. They have a clothing budget of $200 per person annually or $400 total. They pay about $6,000 annually on transportation. Finally, they spend about $4,500 annually on healthcare. Their annual outflow would be $33,900 on which they would pay 23% in taxes or $7,800. They do not qualify for the rebate and so this leaves $8,300 annually for emergencies, pet care, and recreation. This is substantially more than the current system but the loss of buying power will reduce the amount of actual benefit the couple receives from this money.

Case 3)
A single individual with a gross income of $100,000. They pay $2,000 a month ($24,000 annually) on their home. Like the other cases they pay about 10% in utilities or $10,000. They pay an average of $750 a month ($9,000 annually) on food and incidentals. The wealthy individual spends $100 a month ($1,200 annually) on clothes for themselves. They also spend about $15,000 a year on transportation. For health care they pay about $6,000 a year. Their annual outflow is $65,200 and at 23% tax they would pay approximately $15,000, or half of their previous tax contribution. This means that they are now left with a surplus of $19,800, almost four times their previous surplus. Like the other cases they suffer a loss of buying power but this is insignificant in the face of their monetary gains.

To look at the situation as pure numbers we see the following:
Family size 4 2 1
Yearly gross income 30,000 50,000 100,000
Annual rent/mortgage 12,000 12,000 24,000
Annual utilities 3,000 5,000 10,000
Annual food/incidentals 6,000 6,000 9,000
Annual clothing expenses 400 400 1,200
Annual transportation 3,000 6,000 15,000
Annual medical expenses 3,500 4,500 6,000
Total expenses 27,900 33,900 65,200
Taxes paid 6,400 7,800 15,000
Rebate 6,400 0 0
Remainder 2,100 8,300 19,800
To get a real comparison let's look at what remains to each group under the current system vs. the proposed sales tax:
Family size 4 2 1
Yearly gross income 30,000 50,000 100,000
Remainder current 2,100 3,600 4,800
Remainder proposed 2,100 8,300 19,800
Difference 0 4,700 15,000
It is clear that this system does nothing to aid low income families, makes marginal gains for the middle class, and substantially benefits the wealthy. Given that the necessities of life require spending 93% of a low income family's wages, 67.8% for the middle class, but only 65.2% for the wealthy individual it is clear that this system can do nothing to help low income individuals. Furthermore, a wealthy individual can choose to spend less and save their money, further reducing their input into the tax system. Low income families, who are barely getting by, have no such luxury.

If the spending percentage holds steady for wealthy individuals (and it is more likely to go down considering the trend) then a person who earns $1 million in a year would spend about $652,000 (65.2%) and pay taxes of approximately $150,000 (23% of money spent). Under our current system, if they don't find a way to get out of it, a millionaire would contribute almost $300,000 in taxes annually. From this single individual it would be a loss of $150,000 annually in tax revenue. The loss of tax revenue would be substantial across the population necessitating steep cuts to Federal programs. Since there seems to be no move to reduce military spending, which accounts for the greatest portion of government funding, these cuts would almost certainly come at the expense of social programs, many of which are geared at assisting the poor and elderly. This would, of course, make it more difficult for low income families to make ends meet, let alone get ahead in life. 

A solution to our tax problems needs to be found, but a national sales tax is not the answer. Closing loop holes, simplifying tax code, and ensuring the wealthy pay their fair share is the only way we can protect the poor and insure adequate government funding.

Thursday, March 9, 2017

Travel Ban Round 2

On January 27th of this year our President issued Executive Order 13769 entitled PROTECTING THE NATION FROM FOREIGN TERRORIST ENTRY INTO THE UNITED STATES (yes the caps lock is how it appears on the White House website). This order, dubbed the Travel Ban, caused chaos across, not just the US, but the world. The order banned all travel from 7 countries: Iran, Iraq, Libya, Somalia, Sudan, Syria, and Yemen. Protests, aid from lawyers, and finally a judge's intervention put a halt to the ban in short order. When the 9th Circuit Court of Appeals refused to overturn the stay of the Executive Order the President was left with two options if he wished to continue on this vein.

His choice has now been made clear by the issuing of his Executive Order: Protecting The Nation From Foreign Terrorist Entry Into The United States. Sound familiar? That's because his new Executive Order (issued 3/6/17) reuses the title from the previous controversial order. At least this time they figured out what caps lock is. Changes have been made, some of them substantial, but the core of this order is essentially the same.

This order begins with a recap, explanation, and attempt to justify the previous Executive Order. This first part of the order feels overwhelmingly like a parent trying to explain to a small child why bed time is important or, worse, like someone talking exaggeratedly slow to someone who's hard of hearing even though they understand them perfectly well. Section 1(b)(ii) shows the President insisting that what he did was within his powers though there is a clear disconnect in what he can legally do and what he should and actually did. He also insisted in Section 1(b)(iv) that this was not religiously motivated despite the President's previous statements against those who practice the Islamic faith. Section 1(c) goes further by heaping scorn on the court ruling using language clearly designed to delegitimize the court's actions.

The President continues his justifications by adding a country by country list of reasons for banning travelers for 6 of the 7 countries he previously excluded. It is interesting to note that Iran, Sudan, and Syria are justified because they are on the State Sponsors of Terrorism list however the President fails to note that they have been on the list since 1984, 1993, and 1979 respectively. Apparently now, suddenly, the threat of terrorism is great enough to ban all travelers despite the fact that 2 of the 3 have been on this list for more than 30 years.

The President's first concession comes with the treatment of Iraqis. The President calls this a "special case" because of "the close cooperative relationship between the United States and the democratically elected Iraqi government, the strong United States diplomatic presence in Iraq, the significant presence of United States forces in Iraq, and Iraq's commitment to combat ISIS justify different treatment for Iraq." It is important to note that the overriding theme of his justification is US intervention in Iraq.

To further drive home fear of those entering from abroad the President states: "Since 2001, hundreds of persons born abroad have been convicted of terrorism-related crimes in the United States." The President made a similar statement to a joint session of Congress last week. To Congress he stated "According to data provided by the Department of Justice, the vast majority of individuals convicted of terrorism and terrorism-related offenses since 9/11 came here from outside of our country." Politifacts has an excellent article debunking this statement. The highlights of this article include the fact that the DOJ numbers only included those convictions with an international element that began with a terrorism tip, regardless of what the final conviction was for. Of the 580 people on the list 380 were judged to be foreign born based on research conducted by a Senate committee headed by Jeff Sessions at the time. However, only 40 of those 580 involved terrorism that was planned and/or executed on US soil. Additionally, 241 (or half) of the people on that list were convicted of non-terrorism crimes though they are included in the list because the investigation began with a terrorism tip that wound up being unfounded. The President has spent extensive amounts of time concerned with international terrorists while all but ignoring the problems of domestic terrorism and gun violence.

Couching it as an effort to "temporarily reduce investigative burdens" the President then re-ups his travel ban for 90 days stating that "the unrestricted entry into the United States of nationals of Iran, Libya, Somalia, Sudan, Syria, and Yemen would be detrimental to the interests of the United States." His use of the term "unrestricted" seems misplaced since travel to the US has not in recent history been unrestricted and in fact there is a wide gap between unrestricted and no admittance which seems to be his aim. Other than removingIraq from his list his concessions to the outcry include restricting the ban only to those who:
     a) are outside the country on the date of this order
     b) did not have a valid visa at 5:00 p.m., eastern standard time on January 27, 2017
     c) do not have a valid visa on the date of this order
He also allows exceptions for:
     a) lawful permanent US residents
     b) any foreign national who is admitted to or paroled into the United States on or after the effective date of this order
     c) a national with documents other than a visa valid on or after the date of this order that permits entry
     d) dual nationals when traveling on a passport issued by a non-designated country
     e) those traveling on a diplomatic or diplomatic-type visa, North Atlantic Treaty Organization visa, C-2 visa for travel to the United Nations, or G-1, G-2, G-3, or G-4 visa
     f) those who have been granted asylum; any refugee who has already been admitted to the United States; or any individual who has been granted withholding of removal, advance parole, or protection under the Convention Against Torture
This is of course all subject to "case by case exceptions" though he has clarified said exceptions to include when there would be undue hardship, AND entry would not pose a threat to national security AND would be in the national interest. He even provided examples which seem to parallel some of the most egregious offenses of the previous ban. However a review will be conducted of all country's entry procedures and any country found out of compliance may be subsequently added to these restrictions.

The new "Uniform Screening and Vetting Standards" are also a cause for concern. While it is important to prevent, whenever possible, any act of terrorism the language laid out by the President should cause alarm. My particular concern is with the statement "a mechanism to assess whether applicants may commit, aid, or support any kind of violent, criminal, or terrorist acts after entering the United States" (emphasis added). Ensuring that someone is who they claim to be, has not committed or expressed a desire to commit terrorism is all well and good, but the vague use of the word "may" ventures into conjecture that can too easily be colored by prejudice and stereotyping.

The US Refugee Admissions Program (USRAP) gets attention once again with a 120 day ban of all refugees. This time exceptions have been added for those already accepted and scheduled for transit. The President still caps the 2017 admittance at 50,000 refugees but no longer insists upon singling out Syrian refugees with an open ended ban. While this is progress the President might want to read up on the current screening for refugees before he deems that the screening is too lax. He also states a desire to increase state and local involvement in refugee placement which seems to imply requiring state approval before resettlement. This has been a common struggle for some time which is ridiculous considering once they are admitted to the US they will be free to travel within our borders.

In keeping with the President's apparent fear of foreigners this executive order also mandates certain information be published at regular intervals. This information includes:
     a) the number of foreign nationals who have been charged, convicted, or removed from the US for terrorism-related offenses while in the United States
     b) the number of foreign nationals in the United States who have been radicalized after entry into the United States
     c) the number and types of acts of gender-based violence against women by foreign nationals
     d) "any other information relevant to public safety and security as determined by the Secretary of Homeland Security or the Attorney General, including information on the immigration status of foreign nationals charged with major offenses"
The initial report will be back dated to 9/11/01. There are 4 key points in here that I would like to highlight. The first is his use of the term "terrorism-related offenses" which is the same term used in the DOJ report sited earlier and may include convictions for non-terrorism offenses. Next is the fact that this list includes those who have been only been charged with an offense which, in our system, should mean nothing until after the conviction. Under bullet (c) he singles out gender-based violence against women committed by foreign nationals as if this were somehow more significant than the violence suffered by women at the hands of US citizens on a daily basis. Finally is the President's use of the overly broad statement "any other information." I just imagine a group of cranky old white guys sitting around a table and saying "how can we make people unnecessarily terrified of immigrants today."

In general I say nice try Trump, but I'm not buying it.

Friday, March 3, 2017

The Israel Question

The United States has a long history as an ally to Israel but it has not been an alliance without turmoil. Israel's creation after World War II caused the displacement of hundreds of thousands of Palestinians and there has been conflict ever since. For many years the policy internationally has been to pursue a two state solution but this has been fraught with difficulty as enumerated here.

In a recent turn of events Israel has broken with traditional boundary lines in settling Israelis on traditionally Palestinian territory among other things. This has resulted in the UN placing sanctions on Israel in Resolution 2334. Despite being a supporter of the two state solution for many years our current President has shown ambiguity on the subject and Congress has put forth a host of bills in clear defiance of the two state solution goals. Just some of these bills include the following:

S.11
S.107
S.169
H.R. 263
H.R. 265
H.R. 311
H.R. 769

These bills seek primarily to withhold funds from the UN until Resolution 2334 is repealed and the establishment of Jerusalem as the "undivided" capitol of Israel. None of these bills have the objective of peace but rather Israeli dominance to the detriment of Palestinian populations. Abandoning the two state solution without putting forth a viable path to peace is reckless. Waging war has played far too large of a role in American politics in recent years and we should be pursuing options for peace instead of supporting such ill advised measures.

Instead of continuing on at length about this subject I would like to encourage any reader of this post to read or watch the powerful words of Senator Bernie Sanders in his speech on Israel, Trump and anti-Semitism at a recent J Street Conference. Let me leave you with a quote from that same Bernie Sander's speech:
These values are based upon the very simple notion that we share a common humanity. Whether we are Israelis or Palestinians or Americans, whether we are Jews, Christians, Muslims, or of another religion, we all want our children to grow up healthy, to have a good education, have decent jobs, drink clean water and breathe clean air, and to live in peace. 
That’s what being human is about. And our job is to do everything that we can to oppose all of the political forces, no matter what side they may be on, who try to tear us apart.