We now have more information about how affordable health insurance will be once Obamacare rolls out. CNN reports on the costs of the “Silver” middle-tier coverage plan that will be available in California in 2014:
States are starting to roll out details about the exchanges, providing a look at just how affordable coverage under the Affordable Care Act will be. Some potential participants may be surprised at the figures: $2,000 deductibles, $45 primary care visit co-pays, and $250 emergency room tabs.
Those are just some of the charges enrollees will incur in a silver-level plan in California, which recently unveiled an overview of the benefits and charges associated with its exchange. That’s on top of the $321 average monthly premium.
For some, this will be great news since it will allow them to see the doctor without breaking the bank. But others may not want to shell out a few thousand bucks in addition to a monthly premium.
“The hardest question is will it be a good deal and will consumers be able to afford it,” said Marian Mulkey, director of the health reform initiative at the California Healthcare Foundation. “The jury is still out. It depends on their circumstances.”
CNN also provided the following infographic to illustrate the plan’s costs for individuals:
Doing some quick math, California’s Silver Obamacare plan will cost $3,852 annually, which is how much an individual would have to pay for the coverage, even if they never seek medical care. The annual bill only rises above that amount once they do seek medical care.
That’s also the cost that applies for individuals who have annual incomes over $45,960 (four times the federal poverty level). Individuals with incomes below that level will have a portion of their monthly premiums subsidized by the federal government.
Of course, the alternative for not getting health insurance coverage would be to pay Obamacare’s penalty tax. In 2014, an uninsured individual would have to pay $95.
Keep in mind that thanks to the Patient Protection and Affordable Care Act’s pre-existing condition requirement, a healthy individual would be able to obtain health insurance coverage after at most a 90-day waiting period (prior to the Obamacare law, the waiting period could be much longer than that). That sets up a really perverse incentive for healthy individuals to drop their health insurance coverage under the law.
Which alternative do you suppose is really more affordable?
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The 14% wage rise for private-sector workers in 2012, reported by China’s National Bureau of Statistics on Friday, represented an acceleration from 12.3% in 2011.
With high labor costs eating into his bottom line, Mr. Madec uses frozen ingredients—and even complete main courses—for the dishes served at Les Templiers…. a steady increase in labor costs and food prices has fueled an unexpected phenomenon: Many restaurants can no longer afford to prepare meals from fresh ingredients in their own kitchens.
And what’s the lesson I learned from Julian Simon? As I wrote in Libertarianism: A Primer,
Over the long run, in real terms, the only price that consistently seems to rise is the price of human labor. Looking back a hundred years or so, we see that prices of goods–from wheat to oil to computers–have fallen, while the real wage rate has quintupled in 50 years. The only thing getting more scarce in economic terms, that is, relative to all other factors, is people.
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Published May 06, 2013
The comprehensive immigration overhaul being taken up in the Senate this week could cost taxpayers $6.3 trillion if 11 million illegal immigrants are granted legal status, according to a long-awaited estimate by the conservative Heritage Foundation.
The cost would arise from illegal immigrants tapping into the government’s vast network of benefits and services, many of which are currently unavailable to them. This includes everything from standard benefits like Social Security and Medicare to dozens of welfare programs ranging from housing assistance to food stamps.
The report was obtained in advance by Fox News.
"No matter how you slice it, amnesty will add a tremendous amount of pressure on America’s already strained public purse," Robert Rector, the Heritage scholar who prepared the report, said in a statement.
The study is already coming under criticism from some groups and economists who challenge its assumptions, claiming the legalization would help fuel economic growth. Heritage Foundation President Jim DeMint, though, defended the study ahead of its release Monday morning.
"There’s no way you can look at this and say that it’s good for the American taxpayer," he told Fox News.
The numbers could raise additional concerns for Republicans as a Senate committee prepares to consider the legislation later this week.
The comprehensive study, aside from looking at benefits, also factored in the cost of public education and other services like highways and police. The government is already providing some of those services to illegal immigrants, so the $6.3 trillion figure would not represent all new costs.
But most of that cost would be new spending, according to Heritage, as illegal immigrants gain access to additional government programs. The study acknowledges that, for a 10-year period, illegal immigrants seeking a reprieve would be barred from these benefits. After that window, though, Heritage forecasts the costs skyrocketing.
On an annual basis, the report estimates the cost will be $106 billion after the interim phase is over. In the course of their lifetime, the report estimates that illegal immigrant households would receive an average of $592,000 in government benefits.
The $6.3 trillion figure is based on what illegal immigrants would cost the government over the course of their lifetime. It factors in the expected $3.1 trillion in taxes they’d pay to the government.
Supporters of immigration legislation have been skeptical of efforts to assign a cost to the immigration bill. Proponents argue that the value of bringing millions of illegal immigrants out of the shadows and presumably into the taxpaying workforce is immeasurable.
Economist Douglas Holtz-Eakin, former director of the Congressional Budget Office, said the Heritage study ignores key factors like the possibility of illegal immigrants moving up the economic ladder.
"There’s no upward mobility," he told FoxNews.com. "They’re frozen" in low-paying jobs.
Holtz-Eakin said the estimate assumes "no American dream" for those who attain legal status.
Stephen Moore, an economist and Wall Street Journal writer, said many economists challenge the notion that immigrants are a net cost to the country. He told Fox News despite the Heritage findings, there are other studies showing the legalization will be an economic boon that could grow the economy — in turn alleviating the country’s deficit problem.
"You’ve got to look at both sides of the equation," Moore said. "Yes, the immigrants will use benefits, no question about that, but as they become more productive citizens and they come out of the shadows, a lot of economists — myself included — think they’ll become more productive and they’ll pay more taxes."
He noted many immigrants are entrepreneurial, starting businesses that grow the economy.
Sen. Marco Rubio, R-Fla., a key co-author of the legislation, has also stressed that illegal immigrants applying for legal status would not have access to federal benefits while they are applying.
After obtaining a green card, they would still be ineligible for many federal benefits for five years.
The legislation also might not legalize all 11 million illegal immigrants. Some could be disqualified if they have a felony record or other problems in their background.
Heritage claims its estimate is on the conservative end.
"Those who claim that amnesty will not create a large fiscal burden are simply in a state of denial concerning the underlying redistributional nature of government policy in the 21st century," the report said.
Statistics: Posted by yoda — Mon May 06, 2013 12:10 pm
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Does inflation matter? The real cost of living for middle class Americans. Fed on path to growing balance sheet to $4 trillion.
Posted by mybudget360 in banks, debt, economy, inflation
Does inflation matter? If you ask this question to the Fed, it appears like it doesn’t. The Fed is doing everything it can to stoke the fires of inflation. Instead, what it is doing is causing further asset bubbles and misallocation of capital in markets. For most people the cost of living is becoming more expensive. Tuition costs are soaring, healthcare is extremely expensive, energy costs have reached a new level, and incomes are stalled. It is hard to see how inflation is a good thing when incomes get stuck but it is also part of the plan. The psychology of inflation is excellent for a consumer driven economy. If you think prices are going to go up tomorrow, you are more likely to spend today. Falling prices cause consumers to hoard. So the Fed is trying to manufacture more spending but this only works if underlying household incomes move up as well. Inflation for most, does matter.
Inflation back in business
The overall rate of inflation is picking up:
Of course when incomes are stalled, even a modest bit of inflation is going to cause pain. Think of all the items that you pay for in your life. Things have certainly gone up in price yet some people may not notice it because the financing has simply made it longer. How so? For example, you can pay $100,000 in student debt over many decades. Yet the price tag is still $100,000 and many times higher once you factor in the cost of interest.
The Fed continues to offer near zero percent rates to member banks and speculation is now prevalent throughout the financial system again.
Fed balance sheet will hit $4 trillion
The Fed’s balance sheet continues to expand:
The Fed balance sheet is now over $3.3 trillion. At the current rate, it will get very close to $4 trillion within a year. A big driving force is the $85 billion a month of mortgage backed securities it is purchasing to keep the housing market afloat:
Back in 2008, the Fed did not have any Agency MBS on its books. Today it has well over $1 trillion. The Fed also recently discussed the challenges of winding down this massive trade in the market. The Fed is driving the housing market by keeping rates low but also, assuming MBS onto its balance sheet. This is creating severe distortions in the housing market once again.
Japan is a demonstration of what happens when quantitative easing is taken to the next level. Recently, Japan has jumped into the financial markets to boosts its ailing economy. It is hard to see how this adds any benefit to the real economy aside from short-term bursts.
Many baby boomers are now facing growing healthcare bills while having very little saved:
You can see how quickly inflation is hitting some areas like nursing home care. Ultimately, many items that many Americans need to access have far outpaced any real wage growth. The end result is the standard of living for most Americans continues to diminish. Does inflation matter? Only if you live in the real economy and only if you care about the shrinking middle class.
Statistics: Posted by yoda — Sun Apr 14, 2013 2:11 pm
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Rehn: big bank depositors could bear cost of bank failure
People with big deposits could suffer a ‘haircut’ under planned European Union law if a bank fails, the EU’s economic affairs chief Olli Rehn said.
By Emma Rowley, and Reuters6:40PM BST 06 Apr 2013
Plans from Brussels put the onus on bank depositors, rather than the taxpayer, to bear the costs of bank failures.
"Cyprus was a special case … but the upcoming directive assumes that investor and depositor liability will be carried out in case of a bank restructuring or a wind-down," Mr Rehn, the European Economic and Monetary Affairs Commissioner.
"But there is a very clear hierarchy, at first the shareholders, then possibly the unprotected investments and deposits. However, the limit of €100,000 (£85,000) is sacred, deposits smaller than that are always safe."
Mr Rehn was referring to a directive being drafted by the European Commission on bank safety which would set out investor liability in the law of member states.
He was speaking in an interview with Finnish TV after Cyprus last month forced richer depositors to suffer heavy losses in order to secure a €10bn bail-out from the EU and the International Monetary Fund.
Cyprus had initially planned to make people with deposits under the crucial €100,000 mark to take a cut also, before backtracking in the face of an outcry. Smaller deposits are supposed to be protected by state guarantees.
Mats Persson, director of think-tank Open Europe said: "Rehn was only re-stating what’s in an EU proposal tabled in 2012, which quite sensibly suggests a mechanism whereby first, investors and secondly, large depositors – rather than taxpayers – foot the bill when a bank goes bust.
“However, there’s so much uncertainty around the precedent set by the Cyprus bail-out that his comments may still cause some jitters."
Mr Rehn also said that the European Central Bank should launch fresh action to help boost the recession-hit euro zone economy.
Statistics: Posted by yoda — Sun Apr 07, 2013 1:14 am
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Earlier this month Steven Camarota of the Center for Immigration Studies (CIS) critiqued our Cato Working Paper exploring immigrant welfare use. Our report found that low-income non-citizen immigrants use public benefits like Medicaid, foodstamps, and cash aid less than their poor native-born citizen counterparts. Furthermore, when immigrants do receive these benefits the amount is less than the amount comparative natives receive.
Dr. Camarota argues that immigrant-headed households (a once useful term that is now ambiguous) use more benefits than native-headed households, but does not dispute that, when immigrants receive public assistance benefits, the average amount received tends to be less. All U.S. citizens have access to Medicaid, SNAP, and other benefits. In contrast, recent legal immigrants who are not yet citizens are often ineligible from the major benefit programs and undocumented immigrants are never eligible.
The first issue – which is rather wonky – is how to measure immigrant welfare use. Our approach is to count the benefits used by immigrants individually while Camarota’s approach is to include everyone in a so-called immigrant-headed household regardless of citizenship status – especially U.S.-born children and spouses.
Our approach of counting immigrant welfare use individually is used by the conservative state of Texas to measure immigrant use of government education and other benefits. The Texas Comptroller’s Office did not include the children of immigrants who were American citizens when calculating the cost to public services in Texas because, “the inclusion of these children dramatically increased the costs.” The Texas report continued by stating:
“The Comptroller has chosen not to estimate these costs or revenues [of U.S.-born children] due to uncertainties concerning the estimated population and the question of whether to include the costs and revenues associated only with the first generation or so include subsequent generations, all of which could be seen as costs (emphasis added).”
In other words, counting the cost of the children of immigrants who are born citizens is a bad approach. If we were to follow Camarota’s methodology, why not count the welfare costs of the great-grandchildren of immigrants who use welfare or public schools today? Our study, on the other hand, measures the welfare cost of non-naturalized immigrants and, where possible, naturalized Americans.
We focus on comparing poor immigrants to poor natives because it produces an apples-to-apples comparison. In that way we exclude non-welfare using immigrants like Sergey Brin, the co-founder of Google, and other wealthy Americans. For instance, the annual cost of Medicaid amongst 100 non-citizen poor adult immigrants was 42 percent below the cost for 100 native born poor adults. For non-citizen children compared to citizen children, immigrants cost 66 percent less.
Immigrants’ use of public benefits is important and worth exploring from every possible angle as the immigration reform debate develops. Individually, poor immigrants are less likely to receive welfare benefits and when they do the value is less than for poor natives.
This post was co-written by Leighton Ku, PhD, MPH, Professor of Health Policy and Director of the Center for Health Policy Research at George Washington University, Brian Bruen, MS, Lead Research Scientist and Lecturer in the Department of Health Policy at George Washington University, and Alex Nowrasteh of the Cato Institute. Both Professor Ku and Mr. Bruen have conducted research and policy analyses about the use of medical and other public benefits for needy Americans, including immigrants, for many years. Research articles by Ku and/or Bruen have been published in Health Affairs, New England Journal of Medicine, and American Journal of Public Health.
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New Zealand’s Worst Drought in 30 Years May Cost NZ$2 Billion
By Adam Haigh – Mar 16, 2013 6:25 PM MT
New Zealand’s most widespread drought in at least 30 years may cost NZ$2 billion ($1.7 billion) as dry conditions across the North Island threaten economic growth, the government estimates.
“The latest advice is that somewhere between $1 billion and $2 billion will be knocked off our national income, and as every week goes by, the prospect of it being $2 billion instead of $1 billion grows,” English said in an interview on TVNZ’s Q+A program. “We’ll be getting updated advice over the next few weeks from the Treasury as we prepare the forecasts for the next budget in the middle of May.”
Finance Minister Bill English warned last week the drought may curb economic expansion in the nation, where dairy exports of NZ$11.4 billion last year made up 25 percent of all merchandise shipments abroad. The central bank held the cash rate at a record low on March 14 and cited concerns the dry conditions may “substantially reduce economic output.”
Economists at Bank of New Zealand Ltd. have reduced projections for first-half economic growth to 1.1 percent from 1.3 percent because of the drought.
Fonterra Cooperative Group Ltd. (FCG), the world’s biggest dairy exporter that accounts for about 40 percent of the global trade in dairy products, said in a Feb. 27 statement that dry weather conditions in mid-December and January, particularly in the North Island, had resulted in a slowdown in milk supply growth. Drought was declared earlier this month in several North Island regions, including the largest dairying provinces.
Phil Rennie, a spokesman for the Minister for Primary Industries Nathan Guy, has said 2013 is the first time in at least three decades the entire island is suffering from drought.
Statistics: Posted by yoda — Sun Mar 17, 2013 1:30 am
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Potential Cost Of A Nuclear Accident? So High It’s A Secret!
WEDNESDAY, MARCH 13, 2013 AT 5:37PM
Catastrophic nuclear accidents, like Chernobyl in 1986 or Fukushima No. 1 in 2011, are, we’re incessantly told, very rare, and their probability of occurring infinitesimal. But when they do occur, they get costly. So costly that the French government, when it came up with cost estimates for an accident in France, kept them secret.
But now the report was leaked to the French magazine, Le Journal de Dimanche. Turns out, the upper end of the cost spectrum of an accident at the nuclear power plant at Dampierre, in the Department of Loiret in north-central France, amounted to over three times the country’s GDP.
Hence, the need to keep it secret. The study was done in 2007 by the Institute for Radiological Protection and Nuclear Safety (IRSN), a government agency under joint authority of the Ministry of Defense and the Ministry of Environment, Industry, Research, and Health. With over 1,700 employees, it’s France’s “public service expert in nuclear and radiation risks.” This isn’t some overambitious, publicity-hungry think tank.
It evaluated a range of disaster scenarios that might occur at the Dampierre plant. In the best-case scenario, costs came to €760 billion—more than a third of France’s GDP. At the other end of the spectrum: €5.8 trillion! Over three times France’s GDP. A devastating amount. So large that France could not possibly deal with it.
Yet, France gets 75% of its electricity from nuclear power. The entire nuclear sector is controlled by the state, which also owns 85% of EDF, the mega-utility that operates France’s 58 active nuclear reactors spread over 20 plants. So, three weeks ago, the Institute released a more politically correct report for public consumption. It pegged the cost of an accident at €430 billion.
“There was no political smoothening, no pressure,” claimed IRSN Director General Jacques Repussard, but he admitted, “it’s difficult to publish these kinds of numbers.” He said the original report with a price tag of €5.8 trillion was designed to counter the reports that EDF had fabricated, which “very seriously underestimated the costs of the incidents.”
Both reports were authored by IRSN economist Patrick Momal, who struggled to explain away the differences. The new number, €430 billion, was based on a “median case” of radioactive releases, as was the case in Fukushima, he told the JDD, while the calculations of 2007 were based more on what happened at Chernobyl. But then he added that even the low end of the original report, the €760 billion, when updated with the impact on tourism and exports, would jump to €1 trillion.
“One trillion, that’s what Fukushima will ultimately cost,” Repussard said.
Part of the €5.8 trillion would be the “astronomical social costs due to the high number of victims,” the report stated. The region contaminated by cesium 137 would cover much of France and Switzerland, all of Belgium and the Netherlands, and a big part of Germany—an area with 90 million people (map). The costs incurred by farmers, employees, and companies, the environmental damage and healthcare expenses would amount to €4.4 trillion.
“Those are social costs, but the victims may not necessarily be compensated,” the report stated ominously—because there would be no entity in France that could disburse those kinds of amounts.
Closer to the plant, 5 million people would have to be evacuated from an area of 87,000 square kilometers (about 12% of France) and resettled. The soil would have to be decontaminated, and radioactive waste would have to be treated and disposed of. Total cost: €475 billion.
The weather is the big unknown. Yet it’s crucial in any cost calculations. Winds blowing toward populated areas would create the worst-case scenario of €5.8 trillion. Amidst the horrible disaster of Fukushima, Japan was nevertheless lucky in one huge aspect: winds pushed 80% of the radioactive cloud out to sea. If it had swept over Tokyo, the disaster would have been unimaginable. In Chernobyl, winds made the situation worse; they spread the cloud over the Soviet Union.
Yet the study might underestimate the cost for other nuclear power plants. The region around Dampierre has a lower population density than regions around other nuclear power plants. And it rarely has winds that would blow the radioactive cloud in a northerly direction toward Paris. Other nuclear power plants aren’t so fortuitously located.
These incidents have almost no probability of occurring, we’re told. So there are currently 437 active nuclear power reactors and 144 “permanent shutdown reactors” in 31 countries, according to the IAEA, for a total of 581 active and inactive reactors. Of these, four melted down so far—one at Chernobyl and three at Fukushima. Hence, the probability for a meltdown is not infinitesimal. Based on six decades of history, it’s 4 out of 581, or 0.7%. One out of every 145 reactors. Another 67 are under construction, and more are to come….
Decommissioning and dismantling the powerplant at Fukushima and disposing of the radioactive debris has now been estimated to take 40 years. At this point, two years after the accident, very little has been solved. But it has already cost an enormous amount of money. People who weren’t even born at the time of the accident will be handed the tab for it. And the ultimate cost might never be known.
The mayor of Futaba, a ghost town of once upon a time 7,000 souls near Fukushima No. 1, told his staff that evacuees might not be able to return for 30 years. Or never, for the older generation. It was the first estimate of a timeframe. But it all depends on successful decontamination. And that has turned into a vicious corruption scandal
Statistics: Posted by yoda — Wed Mar 13, 2013 9:53 pm
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Michael F. Cannon
One of ObamaCare’s selling points was that it would supposedly reduce costs through such innovations as “accountable care organizations” or ACOs. I have explained how ACOs are an innovation with many benefits, how markets developed ACOs decades before the government’s central planners caught on, and have predicted that ObamaCare’s centrally planned ACO program would fail to deliver on the promised savings. The reason is simple, and explained by industry expert Robert Laszewski:
Here’s a flash for the policy wonks pushing ACOs. They only work if the provider gets paid less for the same patient population. Why would they be dumb enough to voluntarily accept that outcome?
Turns out, health care providers are not that dumb. They have threatened to bolt ObamaCare’s ACO program in the past, and are doing so again [$] if Medicare tries to cut their pay:
One of CMS’ highest profile health care delivery reform initiatives is on rocky ground as most of the Pioneer ACOs are threatening to drop out of the demonstration if CMS makes them start meeting quality measures instead of merely requiring that they report the measures, according to a letter [$] obtained by Inside Health Policy…The Pioneer ACOs were supposed to be the few shining examples of organizations that could handle outcomes-based pay…
CMS often touts the high level of participation in ACOs, and it would seem that CMS has too much at stake to ignore the Pioneers’ requests and let the demo implode, a health care consultant says. However, it’s difficult to believe that this is the first time that the ACOs have brought these concerns to CMS – some innovation center officials come from the very organizations in the Pioneer demo – all of which indicates that negotiations have not gone well with the agency, the sources say. CMS could make changes to the quality metrics without announcing them in the Federal Register because the Pioneer ACOs are a demonstration, but the cat is out of the bag now, the sources note.
The Pioneer ACOs account for a little more than 30 of the some 250 ACOs in Medicare, and the Pioneers are supposed to be the most advanced, integrated systems of them all.
And thus ObamaCare’s false promise of cost savings comes into sharper focus. File this one under “markets are smart, government is stupid.”
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