The Obama administration has admitted that it cannot move forward with a major feature of Obamacare, its long-term care insurance program, due to the fact that it contains a critical design flaw.

The Community Living Assistance Services and Supports program, known as CLASS, a pet program of the late Sen. Ted Kennedy (D- Massachusetts), was to have been sponsored by the federal government but maintained as a voluntary plan to which healthy, younger, working Americans would contribute in the event they became disabled later on in life. Participants would have paid a monthly premium that ranged widely between $235-$3000, depending on income, during their employment years, and then collected a daily cash benefit of at least $50 if they became disabled.

The tragic flaw in the plan is that unless large numbers of healthy people are willing to sign up for the program during their working years, the cost of the program would become prohibitive due to the needs of the disabled who would benefit from the plan. Unlike the purchase of long term care insurance in the private sector, CLASS did not offer lower premiums to healthier participants. Thus, the program attracted those who were already disabled in some way, yet able to work to some extent, and who anticipated the need for long term care in the future. Without healthy subscribers paying into the system, these individuals would not likely be able to afford the steep premiums. (more…)

President Obama, no doubt, would like us all to believe that the government can do things better than the private sector.

He obviously has not visited Philadelphia or the Hartford, Connecticut area this past week, cities that stood in the path of Tropical Storm Irene about a month ago. If he had, he would have seen thousands of supposedly “low income” people, lining up for hours at state Department of Social Services facilities, waiting for what has been billed as “disaster relief” payments for people who allegedly do not receive other welfare assistance and may have lost food or income during the storm. The program, called Disaster SNAP (Supplemental Nutrition Assistance Program), or D-SNAP, was created by the federal government, but administered by states.

According to “stated” D-SNAP rules, in Connecticut, applicants must have met financial criteria to qualify for the assistance. Take-home income and liquid assets for the period from Aug. 27 to Sept. 25 could not exceed $2,186 for a single person; $2,847 for a household of two; $3,272 for a household of three; $3,859 for a household of four; $4,254 for a household of five; $4,753 for a household of six; $5,116 for a household of seven; and $5,479 for a household of eight.

However, some people who have received the “free” money apparently did not have to prove any loss of food or power during the storm at all. In Connecticut, some called into Hartford area local talk show, State and Church, to report knowledge of co-workers who took off from work, with pay, to wait on lines for an entire day at DSS offices to obtain “free” debit cards, suggesting that proof of income level may not have been a hard and fast requirement either.

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Secretary of Agriculture Tom Vilsack has officially joined a prestigious list of Democrat economic geniuses that believe entitlement programs stimulate the economy.

First there was Nancy Pelosi who said, “Now, let me say about unemployment insurance…this is one of the biggest stimuluses [sic] to our economy. Economists will tell you this money is spent quickly. It injects demand into the economy, and is job creating.”

Excuse me Nancy, isn’t cash obtained in a liquor store heist also spent quickly, and couldn’t theft be considered a job creator for cops, the courts, and prison personnel?

Even still, Mrs. Pelosi contends unemployment insurance “creates jobs faster than almost any other initiative you can name because, again, it is money that is needed for families to survive, and it is spent. So it has a double benefit. It helps those who have lost their jobs, but it also is a job creator.”

President Obama, the man who has also proven to be a fiscal whiz kid, concurs with Pelosi that the extension of unemployment benefits is “good for the entire economy.”  Obama said “It’s probably the biggest boost that we can give an economy because those folks are most likely to spend the money with businesses, and that gives them customers.”

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It’s quite possible that, for all of their “Mediscare” tactics, like ads depicting a Paul Ryan look-alike throwing a wheelchair-bound senior off a cliff, the left has not done nearly as much damage to Congressman Ryan’s budget and Medicare plan as some of his own colleagues on the Republican side.

We have seen former House Speaker, and newly announced presidential candidate, Newt Gingrich, begin his campaign by criticizing Congressman Ryan’s proposal as “right wing social engineering.”

Now, Massachusetts Senator Scott Brown has announced, in an op-ed in Politico, that he will vote to defeat Ryan’s proposal to overhaul Medicare. Despite the fact that Senator Brown has had weeks to review his Republican colleague’s plan, he just now takes issue with the House Budget chairman on several curious points.

First, Senator Brown has adopted the position that Medicare, as it is now, needs to remain as is for those who have been counting on it. That’s an odd conclusion to draw when Medicare’s own trustees announced, last week, that the program will likely go broke about five years sooner than previously thought. According to the trustees, many seniors currently using Medicare as their health insurance plan, and those approaching the age of eligibility, will find themselves out of funds in about 12 years.

Second, Senator Brown asserts that a plan to change Medicare should “phase changes in over time.” But, isn’t that what Congressman Ryan’s plan does? Those currently over age 55 would be able to keep the current Medicare program in Mr. Ryan’s budget.

Third, the senator expresses concern that inflation will erode the “premium support” sums that Mr. Ryan’s proposal would provide to future seniors who are currently under age 55. However, doesn’t the senator acknowledge that most current younger and middle-aged Americans would be planning ahead for their healthcare, if they knew they had responsibility for their futures, and not simply waiting to turn 65 to have the government move in on their lives?

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On today’s edition of Coffee and Markets, Brad Jackson and Ben Domenech are joined by Francis Cianfrocca to discuss astonishing disposable income numbers in America. Then, Ben talks to Maureen Martin, legal expert with the Heartland Institute, about today’s expected ruling in Virginia on the legal standing of Obamacare.

We’re brought to you as always by BigGovernment and Stephen Clouse and Associates. If you’d like to email us, you can do so at coffee[at]newledger.com. We hope you enjoy the show.

Related Links:

In Entitlement America, The Head Of A Household Of Four Making Minimum Wage Has More Disposable Income Than A Family Making $60,000 A Year
Full Chart of Income Comparrisons
Why Work?
Ben: Ruling Today on the Individual Mandate in Virginia
Virginia Passes Health Freedom Bill, Setting Up Legal Challenge to Individual Mandate
Virginia Ruling on Standing to Challenge Individual Mandate
Health Care Lawsuits

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Violent protests by public employees  in Greece who are upset that they might have to give up their 13th and 14th months salary is the ultimate sign of dependency. The private sector behaved slightly better but still opposed the changes (“We want the government to take back these measures which freeze our pay rises and force us to stay longer in the workforce,” said Maria Grigoropoulou, a cosmetics store employee. )

These guys seem unable to conceive that they could take care of themselves for a change and not just receive money from the government in exchange for nothing. And yet the Greek austerity plan isn’t that austere ( some wage cuts for public workers, a three-year freeze on pensions and a second increase this year in sales taxes and the price of fuel, alcohol and tobacco,) especially compared to the self-imposed austerity plans in Lithuania and Latvia.

With that in mind, let’s look at what’s happening in the United States. Obviously, we are not Greeks. Yet, the level of dependency is growing in America. Check out this chart.

On this chart we can see the changes over time in the composition of personal income in the United States since 1929. The most notable trend is the increase in the portion of personal income coming from government transfers (mainly social Security payments, unemployment benefits, food stamps, and personal and business tax credits.)  And the increase isn’t minor: the proportion of total personal income constituted by government money has grown from 0.9% to 17.2%.

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Andrew Sullivan posted the following chart, which he found in National Geographic, and he noted, with considerable justification, that this was evidence of an insane and inefficient healthcare  system in America.

Sullivan-Healthcare –

The chart shows that America spends a lot more than other nations without a concomitant increase in life expectancy. Let’s set aside whether the right side of the chart is a bit misleading because American life-expectancy numbers are influenced by things that have nothing to do with the quality of the healthcare system, such as highway fatalities, homicides, and obesity, and focus on Andrew’s claim that Obama’s proposal will make things better because of its “cost-control measures.” Since the Administration’s own experts have predicted that Obama’s proposal will increase total healthcare spending, one can only wonder what he’s talking about. Does he actually think a new government entitlement program will lead to lower costs, when all the evidence suggests otherwise?

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