Category — Politics
Get ready for the latest attack on the U.S. dollar, courtesy of our Congress and the Administration.
On March 23rd, President Obama signed into law a sweeping rewrite of U.S. health-care policy.
Initially, at first glance, it seems good.
It supposedly gives an additional 32 million Americans access to basic health insurance by 2019.
One thing is certain. It’s the biggest change to the American health system since Medicare was enacted in 1965.
However, it seems there are a few unintended consequences coming from this groundbreaking bill.
First of all, this healthcare revolution will cost $938 billion. That’s almost $1 trillion on top of the $12.67 trillion the U.S. already owes.
Now, if you ask the average person where that’s going to come from, they don’t know and probably don’t care.
Keep in mind that the government’s income comes from the taxes that we all pay. So if they’ve got greater expenses, guess what that means?
Greater taxation…and not just for the wealthy either (even though that’s the way Obama pitched his plan to middle-income America who couldn’t care less if a few wealthy fat-cats pick up the bills). Most of these health care changes won’t even start to take effect until 2014. So we’ve got a while before they start taxing us, right?!? Wrong!
One New Tax Went into Effect
As Soon As Obama Signed the Bill!
Many increased costs will kick in next year. But some taxes have already started as a result of this! Since March 23rd, any American who uses a public tanning bed has had to fork over 10% tax for the privilege.
Obamacare Will Create 17,000 Jobs…
(at the IRS)
However, there will be one bright spot. Yes, one segment of our economy will be robust. Which is it? It’s the Internal Revenue Service. They are hiring 17,000 new agents.
The IRS is going to need that many more bodies to help them rake in all of the additional tax money that Obama needs to pay for this.
There’s more. Companies with 50 or more employees will have to pay a fine if their workers receive government-subsidized coverage.
Next on the “Obamacare loser list” is the wealthy.
Maybe you’re on that list. Maybe you’re not. But regardless, this new “tax the rich” policy still affects you. Here’s why.
As you may have noticed, poor people don’t hire employees! No, it’s “wealthy” entrepreneurs who need more workers. If you tax these rich business owners harder, they won’t have the cash they need to continue hiring.
Obama is not wasting any time.
Is it true that only wealthy Americans use tanning beds? Plenty of average people use tanning beds, especially in the dead of winter. That’s just one example of how we’re all picking up the tab for this new health care bill.
But once these changes start, you can bet that employers will initiate more layoffs, and will be inclined to hire fewer people. Why?
Companies with more than 200 workers will be required to automatically enroll all their employees in whatever insurance plan they offer. When those corporations have to maintain these higher costs, they’ll make cuts in payroll in order to preserve their profit margins.
The “rich” make about $200,000 – $250,000 a year, and they’re about to pay 0.9% more for Medicare Payroll Taxes.
By the way, calling someone who makes $200,000 a year “rich” is fair only if you live in a place with a low cost of living. Tell a Californian he’s “rich” because he makes $200,000, and he’ll laugh at you!
Also, these “rich people” will have an additional tax of 3.8% on investment income like dividends and capital gains beginning in 2013.
Have I mentioneed all of the “losers?” No! I won’t go into great detail on the rest, but here are a few other groups that will get hammered:
Believe it or not, within the health care reform, banks will lose the government backing/guarantees on education loans. So schools will have to go directly to the Department of Education for funding.
“The Insured” will also lose out. Experts say we could see “double digit” increases in some places like California (and that’s just for people who make above $88,000 a year).
We’ll All Be Paying for an Expensive
When you put all the pieces of this together, you’re going to see higher taxes coming (and not just on the rich), higher unemployment and lower new employed rates, increased health care costs, etc.
All of this will be yet one more weight and hurdle placed upon corporate America, and many, if not all, of its citizens.
If you think companies are struggling now, wait until all of this comes to a head in a few years. You haven’t seen anything yet!
In the Long Run, “Obamacare”
Spells Trouble for the U.S. Dollar!
This will all take a huge toll on the U.S. economy. It will likely make our economy even more sluggish.
Consider: if consumers and corporations are taxed more and have higher costs, then they are not going to spend as much. When spending is restrained, the economy struggles.
So this long-term “ankle weight” that’s being placed upon the U.S. economy will end up eventually taking a long-term toll on the dollar as well.
It probably won’t affect the dollar immediately.
In fact, in the short run, if stocks, bonds, or commodities were to fall, it would actually help the dollar for now. But over longer periods of time, there’s no way that the dollar can prosper when the entire nation is hurting from the extra yoke placed on both consumers and businesses.
So take this as yet one more warning to get yourself out of the dollar! Use rallies in the dollar to get some long-term positions in foreign currencies and “hard currencies” like gold and silver.
April 6, 2010 No Comments
It doesn’t take a whole lot to connect the stress at a place like Freddie Mac (FRE) and the death by suicide of its CFO David Kellermann, who was found early Wednesday morning.
So far, it looks like the NYT has the best outline of the story and the amazing pressure that Kellermann found himself under, trying to appease regulators, politicians, Freddie Mac’s homeowner constituents, and yes the company’s private investors – negligible as they may be. But… does a guy go downstairs to the basement in the middle of the night in his own home, with his family asleep upstairs and hang himself? Or, did he just know too much? Maybe under pressure, he was getting ready to expose the whole nasty, corrupt, and thieving mess at Freddie Mac???
April 24, 2009 No Comments