Friday, March 26, 2010

Calculating the cost of health care

From the 29 March 2010 Greater Niagara Newspapers

By Bob Confer

The topic du jour for the past week-plus has been the House of Representative’s passage of health care reform. People have been wondering since (and well before that) what they’ll be paying for the health care of others. Before we delve into that it’s important to figure out what you’re paying now in that regard. Grab you most recent property tax bills and tax returns.

First, let’s look at your county/town bill. Refer to the section that reads County Tax. In Niagara County 54 percent of that total pays for Medicaid, the insurance provided to 9 percent of the population who we are told cannot afford medical care. Write down that value which, frighteningly, is more than half of your payment to the County.

Next, move on to your 1040. Determine your federal taxes paid. 20 percent of federal spending goes to Medicaid, Medicare (health insurance for the old) and CHIP (health insurance for the young). So, multiply your federal tax by 0.20. Set the number aside.

Now, determine what you paid to the State of New York. 30 percent of that will go to Medicaid. Tally that up with the numbers you came up with at the local and federal levels and calculate that as a percentage of your total income. I did, and I made the grim discovery that my wife and I had 6.1% of our household income put towards the care of others.

But realize that’s not all of it. Don’t forget that you’re also forced to pay for the health care of nearly all government employees and retirees. If you wanted to figure out what that percentage is you’ve got your work cut out for you, delving through the benefits packages at every level of government from your town to your school to Albany and Washington, DC. It might make that 6.1 percent a devilish 6.66 percent (which would be quite fitting). It may not be a perfect calculation, but it’s pretty darn close.

If you aren’t one of the aforementioned public servants you (and/or your employer) had to pay for your health care. That is, if you could afford to after you paid for everyone else’s first. If you did receive job-based health insurance you probably had to pay a portion of the premium, be it 25, 50, or 75 percent. Depending on the employer contribution and your plan, that could be a pretty penny. Typical insurance packages in WNY are just under $4,000 for single, a smidge under $7,500 for double, and in excess of $11,000 for family coverage. Statistics show that the average family that pays for health coverage puts 22% of its household income towards it.

Now, add your premium payments to what you’re paying for others’ insurance (the quality of which, by the way, probably far rivals what you get from your insurance) and you’re looking at an incredibly massive portion of your family’s income being dedicated to health care…yours and that of someone you don’t even know. And people wonder why most homes can’t survive without two breadwinners.

That value is destined to go up – not down! – with the passage of health care reform. Don’t let Congress fool you when they say the “evil” health insurance, medical equipment and pharmaceutical companies – not you - will foot bill. Those corporations aren’t super-powered like the government; they can’t create money out of thin air to pay the new taxes. They have to get it from somewhere or someone: Namely their customers, you and me.

It won’t be cheap, either. 32 million people will have to become insured. About 25 percent more – approximately 40 million Americans - are already on Medicaid and look at how much that costs us. Just suppose the numbers extrapolate nicely and our new-found payments for this so called “reform” are three-quarters of what we’re paying for Medicaid now. Come 2014 we’ll be paying another extra 3 percent of our income to cover those who were just granted insurance through Obama’s and Congress’s benevolence (using our money), bringing the grand total to almost 10 percent of your earnings.

So, in a few years, if you aren’t one of those who have their health care provided by the government through employment or subsidy you might as well say that one-third of your hard-earned dollars will be spent on health care. It’s enough to give someone a heart attack, so thank goodness you’ll have coverage!

Friday, March 19, 2010

Cell phones are not a right

From the 22 March 2010 Greater Niagara Newspapers

By Bob Confer

Numerous times in our young marriage The Wife and I have had discussions about our cell phone packages. We’ve debated at length the minutes, data plans, and equipment that best suit our needs and, more importantly, our budget.

Conversations such as those play themselves out in millions of households across the United States. It’s a common subject because most people agree that, unless their job requires their use, cell phones are luxury items. Mankind has survived for eons without these devices which have only relatively recently become mainstream in their usage. Many rightly know that if something must be cut in a family’s budget there’s a good chance their calling plan will be the first to go. After all, telephones are nowhere near as important to our well being as food, water, and shelter.

Even though the common and fiscal senses dictate that cellular phones aren’t a necessity there are still plenty of people in government – and many more who are subservient to them – who believe that they are. They even go so far as to believe that they are a human right and everyone deserves one.

Unfortunately, it’s we, not they, who are paying for that misguided belief.

For the source of your donation (albeit a forced one) look at your most recent phone bills, cellular or landline. Locate the line item that says “Federal USF Surcharge.” A typical home phone may show a charge of just over $1. Family packages on cellular devices could show something in excess of $2. Business phones, depending on traffic, face higher fees. As an example, in our busiest months my company pays about $25. Now, just imagine the collections from millions of families and businesses. It works out to be about $9 billion per year.

The aforementioned surcharge (read “tax”) is for the Universal Service Fund, a behemoth of public benevolence created by the Telecommunications Act of 1996. The Fund has four distinct responsibilities. The government uses it to temper phone charges in high cost areas, provide affordable telecommunications services to economically disadvantaged schools and libraries, aid rural health care providers in their ability to communicate and, last but not least, provide free or discounted phone service to low-income individuals (to the tune of just under $1 billion annually).

It’s the latter that drives the countless ads you see on TV or the Internet from companies like SafeLink Wireless and Assurance Wireless that tell people they can get free cell phones that come equipped with 60 to 200 free minutes per month, depending on the carrier and the state. Families who fall under certain income thresholds (135% of the poverty rate) or receive public housing assistance or Medicaid are eligible for the phones, fully funded by your taxes.

Many folks on both the Left and Right have no qualms – or limited ones – about helping others get through tough times with home and health subsidies. But cell phones, that’s another story. These free phone programs have been met with justified protest in many states.

But, alas, the program subsists because of concerns like “discontinue the program and what will the poor people do?” To them, I pose the simple answer, the right answer. They need to do as the rest of society and if times get tough do without the cell phone. Do like we did 15 years ago before this program was ever conceived: Rely on a landline (whether it’s theirs, their friend’s or family’s) or a payphone. They could even rewind to the 1980s and get a CB radio. They worked just fine as the mobile communication device of choice back then (they were that era’s cell phone) and for a one-time investment equal to a month’s telephone bill someone can outfit their car or home with a quality set-up. As someone who still keeps a CB in truck and home I can attest to their timeless usefulness.

Basically, when it comes to non-essential items, you make accommodations to deal with life’s inconveniences. As singularly important as we all think we are, there are really very few people who need to be in constant contact or have the ongoing accessibility afforded by a cell phone. They are a modern luxury and, to many users, nothing more than a toy. It sure doesn’t sound like something we should be spending our tax dollars on.

Think about it: As you struggle to pay your family’s cell bill month to month, do you take any consolation in the fact that you’re subsidizing someone else’s ability to gab with their friends free of charge?

I didn’t think so.

Sunday, March 14, 2010

The census and your privacy

From the 15 March 2010 Greater Niagara Newspapers
By Bob Confer

In his recent column for the Greater Niagara Newspapers my friend Scott Leffler waxed poetic about how illogical – if not illegal – the US Census has become as it asks questions that were unintended by our Founding Fathers. As with quite a few issues, I agree with Scott on this one and I will be one of those folks he mentions who will try their luck by filling out only one question on the 10-question form. If push comes to shove with the Census Bureau I have the Constitution and this soapbox I call my column on my side.

Some may think that people like Leffler and myself are driven mad by conspiracy theories. Not so. We’re only playing by the book, one that is the most important book to people of this nation: The Constitution of the United States of America. The Constitution requires that a census be conducted only for the purpose of enumeration (basically, a head count) to determine the apportionment of Congressional representation and direct taxes to the States. Since it is a count only all other questions are moot and only serve a Federal Government that is much larger than that which was intended.

The Census asks about home ownership (or rental) claiming that it in indicator of the nation’s economic health and is key to the administration of housing programs and planning. It also asks questions about age, sex, and race, which the Census Bureau says is necessary for the implementation of equal opportunity and Civil Rights programs. The Bureau’s website even goes as far to say, “state governments use the (race) data to determine congressional, state and local voting districts.” That begs the question, one to be answered another day, just what does race have to do with voting districts?

The standard Census form is nosy enough, but it’s not the worst. In past 10-year Censuses a random number of households (about 1-in-6) received a long form that asked many more-specific questions. That practice has been abandoned and replaced with a questionnaire that has been sent to about 1 out of every 40 homes every year since 2005. The American Community Survey (ACS) is the Census Bureau’s way of keeping data – that supposedly cannot wait every 10 years – current and fresh so the government can make “critical” decisions. The Bureau cites the ACS as an extension of the standard Census and, therefore, in their eyes, participation is mandatory.

If you are unlucky enough to receive one of these 14-page packets in the mail you will find yourself facing questions that you probably wouldn’t comfortably share the answers of which with your friends and neighbors, let alone Uncle Sam. What time do you leave home for work? How long does it take you to get there? How many hours a week do you work? What is your annual income? How many times have you been married? Do you have difficulty making concentrating, remembering or making decisions? Does the home have a toilet, running water, a sink, a stove, a fridge, etc?

There are other questions that could be considerably time consuming. You’ll actually have to do your homework to answer them; things like: What are your monthly gas and electrical costs? What are your annual water and sewer costs? What could be your home’s selling price? What did you pay in real estate taxes? What is the monthly rent or mortgage? How large is your insurance bill?

If you’re interested in seeing the ACS and just how nosy the government can be a copy of the form can be downloaded at

Like Mr. Leffler, I won’t tell you whether or not to fill out the Census or the ACS in their entirety. It’s your prerogative. If you feel that you’re doing your job as a good citizen in answering all the questions as a means to help the government plan for our future, more power to you. If on the other hand you decline to answer the questions citing Constitutional responsibility, kudos to you as well. The Census, like beauty, is in the eyes of the beholder: Some people can’t live without big government while others would chose to do without it.

Friday, March 5, 2010

An America less free

From the 08 March 2010 Greater Niagara Newspapers

By Bob Confer

Say the word “America” and a few other words immediately come to mind. Freedom. Liberty. Prosperity.

You might be shocked to know that our nation, which has long represented those values more so than all others, is nowhere near the pinnacle anymore. As a matter of fact, we’re only eighth best in the world.

For a decade now the Heritage Foundation and the Wall Street Journal have worked together to produce something called the Index of Economic Freedom. It analyzes 10 factors that affect all participants of a nation’s economy – businesses, workers, consumers alike – such as property rights, government spending, freedom from corruption, and the seven freedoms of business, monetary, labor, trade, investment, fiscal and financial freedom. The Index analysts assign a 0 to 100 grade to each of those factors. The average of those 10 items is then identified as the country’s final grade that is used to compare it against 182 other nations.

In the recently-released 2010 report the United States posted a score of 78 which ranks us eighth overall. Thanks to a one-year drop in score that was the greatest among the world’s 20 largest economies, we fell two slots. The nations who now have more freedom than we are, in order, Hong Kong, Singapore, Australia, New Zealand, Ireland, Switzerland, and Canada.

Think about that: We here along the border joke incessantly about Canada being a quasi-socialist nation yet, the truth be told, it’s we who are less free economically than they are.

How did we earn such a low grade? We’ve historically had a grade in the low 80s that can be attributed to administrations and congresses both Republican and Democrat that have spent heavily and restricted our abilities with as much vigor. We’re no better off than we were in 1995 (the earliest date available in the study) and we’re significantly less-free than we were just last year. That sudden decline to our already-low grade (at least one that’s low in comparison to where we think America should be) is a result of 8 factors dropping in value and 5 of them that are at a grade of 75 or below.

Investment freedom is the highest among those 5 at 75. The low grade is a result of restrictions that are placed on foreign investment in significant portions of our economy like banking, mining, shipping, communications and aviation to name a few. In a global economy that is a major detriment to development that could come to our shores from outside. In the future we cannot rely solely on American money to take us forward.

Freedom from corruption comes in at 73 and shows some substantial risk for the future based on the lack of accountability and transparency by the public and private entities that is inherent to TARP and other bailout programs.

Financial freedom received only a 70. This category took a significant hit since the Recession began with all of the private and federal adjustments made to correct what went wrong with the sub-prime mortgage crisis. As numerous banking and financial firms have failed (thus limiting the choices for businesses and average people) others have been propped up by the federal government, but with strings attached, tempering true liberty and the access to money.

Fiscal freedom chimes in at paltry 67.5. The report cites tax rates at the federal/state/local level that are among the highest in the developed world. That’s your money being taken away from your company or your home and being used by others elsewhere. This leads into the lowest of our grades, the root cause of our fiscal woes, a 58 bestowed on government spending. Once again we are worse than the world average in this category, the result of total government spending that was 37.4 percent of GDP. The report noted year-to-year growth of federal spending that exceeded 20 percent.

It’s disconcerting that we really aren’t the cream of the crop when it comes to economic freedom. We’re America…we’re supposed to be Number One! Where will we be in 20 years? Could we slip further? If we do, then how quickly could China overtake us as the world’s largest economy?

The grades contained within this and future studies should serve as a discussion piece, a motivator, for elected officials, concerned citizens and voters. We need to work together to better our ranking. Doing so requires an attention to the barriers and burdens that impact our day-to-day lives. Prosperity comes from freedom and we need both now more than ever.