The Political Thought Challenge

Three Healthcare Reforms for a Free Market

2009-11-09T19:03:00.000-08:00

Before healthcare reform is enacted, I thought I would give one last plea for legislation that may actually reduce costs and preserve the free market system; a system which has yielded countless advances in technology and improvements in care. That same system has left many out of the healthcare loop, and that should be corrected.

First stop funding comprehensive healthcare, not just the public option either; I mean end the tax breaks for comprehensive too. Comprehensive insurance covers routine costs, such as visiting your primarcy care physician. Instead, start a comprehensive healthcare account for everyone and seed that account with an annual allowance, then require a minimum percentage deduction from every paycheck to go into the account. Each person would spend from the account as needed. Primary care physicians typically prefer cash paying customers and offer discounts, as they dramatically reduce paperwork.

Second, require all employers to provide catastrophic health insurance. During the first 120 days of employment an employee could receive a public option plan. Once the employee reaches the 120 day point, the employer would need to provide at least 75% of the cost of the catastrophic insurance. This could be written off as a business expenditure and should be affordable for businesses given that the employee is taking on all of the comprehensive costs.

Third, employees could build their own healthcare gap accounts, to set aside funds for the eventuality of losing employment.

This healthcare reform could result in expanded coverage, portability and savings; while maintaining the free market principles that create innovations in technology and medicine.

401K Plans Responsible For Stock Market Bubbles

2009-04-01T10:52:00.000-07:00

Without a doubt the stock market has been behaving erratically. Many people have lost much if not all of their 401K retirements. After, doing some research on the 401K plans, I discovered that there was a certain parallel between the market increases and the advent of 401K plans. If you have any doubt about this correlation, then I encourage you to compare stock charts to the inception of 401K plans in 1980.

401K plans tend to take a blind shotgun approach, though some will actually invest directly into the employees company. The blind shotgun approach, basically means that you invest in a particular market through a mutual fund. The fund invests your money in a broad spectrum of stocks in a particular sector. Most people don't have the time to investigate the fundamentals of all the individual stocks. This approach has some advantages, in that you do not lose all of your money if just the one stock you are investing in tanks. The disadvantage of not knowing much about your investment can weigh heavy not only on your own situation, but on the market itself. The markets need wise input from investors in order to prosper. Making matters worst is the inability of investors to pull their money out of the market.

All of this leads to a large amount of poorly invested funds, which ultimately leads to the bubble scenario.

A few government reforms can be made to curtail the impact on the markets.

1- Reduce the maximum amount an employee can invest in 401K plans from 14% down to 7%

2- Reduce the maximum employer matching contribution to 4%.

3- Allow individuals to earn interest on up to $50,000 tax free. This would be as an alternative way of saving to the 401K plans.

Government does not establish a lot of specifics on how 401K plans are organized. Companies devise much their own plans. Companies could take a split approach to the 401K, requiring employees to invest 50% of their money in mutual funds and the other 50% in no less than 2 and no more than 4 specific stocks. Employees could educate themselves on the specific stocks, while maintaining a broad spectrum approach with the other half.

When will the Recession End?

2008-12-27T08:02:00.000-08:00

Well, the recession has been going on for over a year now, the housing crisis which started it nearly 3 years. The housing crisis of course began a monetary contraction, which essentially means that money is disappearing from the economy. The Federal Reserve which controls the money supply, has been acting to expand the supply of money, with loans to banks at near zero percent.

So, I keep hearing people talk about severe times coming, and I myself was in that crowd until recently. I can recall telling people 2 years ago, that the economy would fall into a recession it could not recover from until the Fed cut it's rate to zero percent. That time has come, but with mortgages known as Alt-a and others gearing up for a crunch later this year, many are concerned that the worst is not behind us. My own opinion on this matter is that money is being so thrown at this economy, that these Alt-A mortgages will be no more than a bumb in the road.

So here is your chance to have a say. Today's thought challenge:

When will the recession officially end?

Will GMAC Bank Fix Auto Industry Woes?

2008-12-26T11:02:00.000-08:00

If you've been following my blog, then you may know that essentially I've already wrote off General Motors. My reasoning being that the real fix for the auto industry would be a sales stimulus. So, today I read on Bloomberg that GMAC financing is becoming a bank, and will receive some TARP funding. GMAC is primarily owned by Cerberus, which owns Chrysler.

This news may be closer to a solution than any other solution so far. How far it will take us another question altogether. It really makes me wonder, why this took so long to happen.

Today's thought challenge:

Will GMAC bank status significantly help the auto industry?

Gasoline Rationing For The United States

2008-12-15T09:41:00.000-08:00

Well, I thought that today we could focus on the price of oil, which has been down considerably in recent weeks. Oil had been trading in the $40-50 range, but now is moving higher. The market is reacting to expected cuts in production. Speculators must be having a field day with this.

What is the United States to do about this? Can The U.S. do anything? Calling for improved economy standards is one possibility, but that takes time and action may be required sooner rather than later.

This brings us to Today's thought challenge:

Should the United States ration gasoline?

It has been done before. If you have personal experiences with this please share them. My experience with this was pretty limited as I was quite young at the time.

GM Pronounced Dead

2008-12-12T14:42:00.000-08:00

"GM Pronounced Dead" was the title to my most recent video. While the video takes a light hearted look at the automakers demise, the subject rings with an undertone of uncertainty for many Americans. In self defense I will have to point out that I was in fact advocating a plan to stimulate sales of the industry as a whole. I must also point out that of the posts observed online, very few people were actually in favor of the bailout plan. Furthermore the few who were, seemed to be from one of the troubled automakers and not consumers or the public.

GM's death comes after 100 years and 87 days of automaking, according to the GM heritage center

http://www.gm.com/corporate/about/heritage/

The clock is still ticking at the GM heritage center, but this really is no more than a technicality at this point. It is somewhat ironic that one of the automakers which was called upon to help the U.S. fight Japan and Germany during World War II was actually denied assistance when the automaker needed help fighting imports from those very countries.

Today's thought challenge:

"How high will the unemployment rate go in 2009?"

Is Ford Overly Concerned About GM Chrsyler

2008-12-10T07:38:00.000-08:00

As everyone knows by now Ford is asking for a credit line just in case GM or Chrysler fail. They say that they have no intention of using the credit line. The notion that GM's failure would lead to problems at Ford is the subject of today's thought challenge.

Ford claims that the supplier networks would be so hurt by a bankrupt GM or Chrysler that they would have trouble getting parts.

Today's thought challenge, actually two questions: "Would Ford be hurt by a bankrupt GM or Chrysler?"

. "Would demand for Ford, Toyota and Honda vehicles increase, or be hurt even more, due to economic decline"

Illinois Governor Rod Blagojevich Arrested!

2008-12-09T11:56:00.000-08:00

This is Big News! Today's story of the day to be sure. Illinois Governor Rod Blagojevich Arrested for allegedly trying to profit from the appointment of President Elect Barack Obama's successor.

At this time no allegations of any wrongdoing have been made regarding the president elect. The Feds apparently have Rod on tape attempting to make deals. It will be interesting to say the least to see how far this thing will fan out.

Today's Political Thought Challenge:

Will Rod Blagojevich make the Senate appointment, or will he resign prior to making the apppointment, or lastly not resign and not make the appointment? There may be other possibilities so please comment.

Kiss Your Chevy Pontiac Dodge Goodbye!

2008-12-08T07:41:00.000-08:00

Well "Kiss Your Pontiac Goodbye" that was the title to my most recent video on You Tube. Now I will be the first to admit that the video quality is not great, but I found it necessary to post the video anyway. I wanted to draw attention to the fact that consumers are being left out in the cold in this whole bailout debacle.

Should consumers be allowed to testify before congress? They're showing up at dealerships across the country, fillout out loan applications and being turned down by the droves. It's not just The Big Three either, Toyota and Honda are experiencing sales declines of epic proportions.

So, today's thought challenge "Should Consumers be allowed to testify before congress on the auto bailout?" Here's your chance to be heard, so please vote or else you can "Kiss your Pontiac Goodbye!"

$15 billion band-aid for auto industry bailout

2008-12-06T08:16:00.000-08:00

At this point it looks like congress will vote sometime next week on a $15 billion bailout for the auto industry. Really, this is just a band-aid. If you are thinking that they will be back for more, you are probably right.

This is today's political thought challenge- Is the $15 billion bailout enough or will the auto industry ask for more by spring?

Also, you voted on the question "Will going green improve life quality?" the answer overwhelmingly yes.

Please vote or comment either on the auto industry bailout polls or the George W. Bush Legacy polls.

Top Ten Bush Mistakes

2008-11-30T07:40:00.000-08:00

With President George W. Bush now a lame duck and his term coming to an end. Many people are breathing a sigh of relief. This is perhaps a good time for us to take a look at the Bush presidency and see if we can determine what he did that was right and wrong. Today's question is what did "W" do wrong. Today's poll asks you to rank his mistakes. Unfortunately this poll format does not permit other submissions, however I encourage you to relay your own thoughts in the comment section. Also, you will find two additional respsonses other, and no mistakes. Next post I promise will be Top Ten things "W" Bush got right.

Battery Technology Advantages Beyond Auto Industry

2008-11-29T08:45:00.000-08:00

I just read an article in the Wall Street Journal's Market Watch, about a new battery technology being developed for the purpose of storing energy from electrical grids. The new battery technology holds off peak electric for use during peak operation. This application could be used by individual companies to take advantage of cheaper off peak electric or used by the electric producers themselves. Wind turbine producers for example reach peak output at times that are incongruent with their customers demands. Utilizing this new battery technology would enable such producers to target customers peak usage.

Lithium ion batteries have already found their way into cell phones as well as power tools. As the new battery technology advances for the auto industry we can expect to find it's proliferation in applications not even thought of yet. Imagine what this new battery technology will mean for the power lawnmower. No more oil to fill, ignition, gasoline. Imagine a battery battery technology back pack which could be plugged into drill, wead trimmers, lights, radios, and computers. This new battery technology could revolutionize gardening and camping.

Today's thought challenge poll- Do you think that going green will improve life quality yes or no?

The future of green fuels?

2008-11-28T11:18:00.000-08:00

With gasoline prices now fallen to below $2.00 per gallon and the auto industry in a bit of a tailspin, I thought that it might be a good time to discuss the future of green auto fuel technologies. Please vote in our poll on which green auto technology will be of greatest use 5 years from now.

First of all the future of ethanol is as a green auto fuel questionable, at least in the non corn growing areas, where transporting costs are a factor. Ethanol has also been under considerable attack by those who contend that it may not be so environmentally friendly. Biodiesel as a green auto fuel is likewise in a similar situation. Used cooking oil still holds economic benefits for those who are willing to make their own fuel.

Improvements in battery technology will lead consumer preferences for alternate vehicle fuels. The technology has come a long way in recent years and certainly was given a much needed boost by the oil crisis of 2008. Early uses will likely be limited to hybrid applications, with fleet vehicles giving the most immediate paybacks.

Natural gas as green auto fuel has been given a political boost during the crisis by T. Boone Pickens the geologist who insists that the technology is the solution to Americas energy needs. There is almost a need for exploiting this energy source, before it becomes obsolete. Future solar and wind applications will likely could make this commodity worthless. It is clean burning and America has a large supply of it. Will the automakers agree to doing conversions? This really is the big question and my guess is no. Consumer conversions will likely pave the way for this industry.

Water split into HHO for burning in autos has developed a following on the internet. Most are using this green auto fuel technology for the purpose of improving gasoline rather than as a singular fuel. The advantage of HHO is that it burns quicker than gasoline allowing for improved efficiencies for properly tuned automobiles.

Fuel cell vehicles, these vehicles seem to get pushed further and further down the R & D pipeline as a green auto fuel with each passing year. Don't look for this technology to come to your neighborhood anytime soon.

Toyota Honda could use help too

2008-11-22T20:10:00.000-08:00

According to articles in the Wall Street Journal the Big Three aren't the only automakers cutting production. Toyota, and Honda have both announced cutbacks. More cutbacks are in place for Mazda and Nissan in Japan. No car company seems to be immune to the current downturn.

In my previous post I suggested a plan that would help revive the auto industry as a whole. Layoffs at Toyota, Honda and others confirms the concern I have that a Big Three bailout would not satisfy the root cause of the current dillemma, bank lending practices. The layoffs announced reflect current market conditions. As the situation deteriorates more layoffs could occur.

The feeling amongst the public today is one of disgust for the Big Three. Perhaps it was the gas guzzling behemoths that the public was so fond of only a feew years ago, that makes the public so cynical. It probably won't serve as much consellation to any of us if the heads of Toyota, Honda and Nissan start asking the U.S. congress for help.

Please read my previous post on stimulating auto sales.

A solution for the Auto Industry

2008-11-19T15:13:00.000-08:00

One of the things that I like to do is to come up with solutions. If this process stimulates discussion and or thought then I feel I have accomplished my goal. Today, I would like to discuss a solution I've come up with for the auto industry, here in the United States.

My proposal is a fairly straight forward system, for stimulating auto sales as opposed to the more complex challenge of pumping cash into deserving car companies. In fact many or most observers would remark that none of the car companies deserve any bailout money. Additionally it would spoil our free market system to pick winners and losers.

Another aspect of my plan is that it would not be a direct cash infusion into companies, but rather a way of stimulating automobile sales.

Here is my plan in a nutshell: The federal government would provide U.S. citizens a $1000 rebate for the purhcase of any vehicle manufactured in the United States. The rebate would be a flat $1000, meaning that whether you purchase a Ford Taurus or a Hummber you will still receive only $1000. Additionally, a rebate of $300 would apply foreign vehicles, provided that the country of origin is willing to cough up an additional $700 in rebate money. The reason for providing a break on foreign vehicles is to prevent accusations of protectionism.

Some people would argue that this system is not fair to those who cannot afford to purchase a car. This is a fair argument, however I think that it is worth noting that we would all benefit from a more stable economy. Also, since this is not a cash infusion into the industry we would not have the burden of paying cash to the industry on the one hand, while paying unemployment and other layoff costs on the other. Furthermore, this is a bottom up approach, which means that even if one year from now no progress has been made; then at least the consumer will have benefited from the rebate.

Barack's Early Christmas Present

2008-11-17T16:11:00.000-08:00

Will there be an early Barack Obama Christmas present. Treasury Secretary Henry Paulson's announcement that he would leave the remaining $350 billion in bailout money to the new administration is as unprecedented a gift as any president has ever been handed. Paulson having already spent $350 billion(primarily on the purchase of bank stock), may even be feeling a sense of relief by leaving the Obama Christmas present. When Paulson originally, came to congress asking for $700 billion he had envisioned the U.S. Treasury purchasing foreclosed homes and other bad debt, none of which would have been easily accomplished. It wasn't long before he realized that such a complex task would take more time than allowed, so he began buying bank stock instead. The stock purchases gave the banks time to regroup, but unfortunately that regrouping has not included a return to lending practices. This left Paulson in a delimma, what to do with the remaining $350 billion. Congress had already requested that $25 billion go to bailout the auto industry, so why not simply allow a Barack Obama Christmas present and let the president and congress decide for themselves what to do with the remaining?
Here is today's thought challenge, actually, two challenges:

1- How should the Obama Christmas present be spent? How will the new congress use the remaining $300 billion bailout money?

First Black President?

2008-11-15T13:06:00.000-08:00

Is Barack Obama the first black president? It always amazes me how the media will grasp onto an idea or concept without first putting it to the test. The third millenium is a good example of that. Contrary to what you heard in the press, January 1, 2000 was not the first day of the third millenium January 1, 2001 was. This is based upone the reality that there never was a year zero. The first year has always been referred to as the "year of our lord". A millenium is one thousand years, therefor 1-1000 is the first millenium, 1001-2000 is the second millenium and the third millenium began with the year 2001. Watching the turnover from 1999 to 2000 was eventful as all four digits did in fact change. Nonetheless the millenium did not start on January 1, 2000.
Now I would like to talk with you about a more recent media myth. The media has portrayed Barack Obama as "The First Black President" or "The First African American President". It is true that Obama is an African American of Kenyan descent. What is not likely to be true however, is his status as the "First black President". That title may well belong to Thomas Jefferson, though Jefferson appears to have done much to avoid the knowledge of the title. Jefferson, Jackson, Lincoln, Harding and Coolidge have all been identified as of African Descent by historians. Eisenhower may also have been of African American descent.
Native Americans may also have been represented in the oval office as well. In the future DNA evidence could find even more evidence of American presidents with mixes of blood. Perhaps, Bill Clinton would like to have his DNA tested so as to include himself in this group. His family tree has a few unknowns in it, so who know? See how long this list could get.
The question now is "does it matter?" I think not. The election of Barack Obama was solid and not racially motivated. Indeed it was the stock market crash and McCain's selection of a pereceived unqualified running mate, that tipped Obama towards victory. If you don't believe me track the polls in the final weeks of the campaign.
Perceptions do count however, and Barack Obama has the attention of the international community. Indeed at this time he appears to be the most popular living mortal(not deity) of all time. Even more popular than "The Beatles". His ability to live up to expectations, may be his greates obstacle, even greater than the financial crisis itself.

The Electoral College Miscount

2008-11-11T13:09:00.000-08:00

It is now November 11, 2008 and I just checked one of my favorite news sources CNN, for an update on the election of one week ago. The Electoral College tally CNN has been displaying for nearly a week now shows Barack Obama 364, McCain 163 with only the state of Missouri too close to call. For nearly a week now I have been in utter dismay at the news giants inability to accurately count these electoral votes. Until just a couple of days ago nearly every news article written on the subject reported that one of Nebraska's electoral votes would likely be given to Obama. This split would be a first for any state and certainly a news worthy event.
You see the problem here is that CNN is giving all of Nebraska's electors to McCain. In actuality his elector college count not including the Missouri result should be 162 not 163. Furthermore, the few news sources covering this historic event are calling Obama the winner of the Nebraska district, giving him 365 electoral votes.
Now, I have sent CNN a message concerning this matter and have received no specific response to my inquiry. It really isn't my concern that this matter would somehow affect politics in any manner. My concern is simply getting it right. The people of Nebraska deserve to have their little blue dot on the map of America just the same as Illinois, Florida and Maryland. Now I do not suspect foul play. What I actually do suspect however, is that CNN simply does not have the equipment to handle this unusual occurance. Additionally, I suspect that CNN has intentionally, left this story underreported due to their inability to post the lone districts elector on their costly display. So yes, I do believe that every vote should count, even when the count is lopsided.