Illinois, where Obama's career was born, no longer pays its bills

CHICAGO — Even by the standards of this deficit-ridden state, Illinois’s comptroller, Daniel W. Hynes, faces an ugly balance sheet. Precisely how ugly becomes clear when he beckons you into his office to examine his daily briefing memo.

“This is what the state owes right now to schools, rehabilitation centers, child care, the state university — and it’s getting worse every single day,” he says in his downtown office.

Mr. Hynes shakes his head. “This is not some esoteric budget issue; we are not paying bills for absolutely essential services,” he says. “That is obscene.”

For the last few years, California stood more or less unchallenged as a symbol of the fiscal collapse of states during the recession. Now Illinois has shouldered to the fore, as its dysfunctional political class refuses to pay the state’s bills and refuses to take the painful steps — cuts and tax increases — to close a deficit of at least $12 billion, equal to nearly half the state’s budget.

Then there is the spectacularly mismanaged pension system, which is at least 50 percent underfunded and, analysts warn, could push Illinois into insolvency if the economy fails to pick up.

States cannot go bankrupt, technically, but signs of fiscal crackup are easy to see. Legislators left the capital this month without deciding how to pay 26 percent of the state budget. The governor proposes to borrow $3.5 billion to cover a year’s worth of pension payments, a step that would cost about $1 billion in interest. And every major rating agency has downgraded the state; Illinois now pays millions of dollars more to insure its debt than any other state in the nation.

A prof schools a slow student, Barack Obama

Mr. Barack Obama
President, Executive Branch
United States Government
1600 Pennsylvania Ave., NW
Washington, DC 20500

Dear Mr. Obama:

CBS radio news this morning ran a clip of one of your recent speeches. In it, you criticize insurance companies because they “ration coverage … according to who can pay and who can’t.”

My first thought was “not exactly; coverage is rationed according to who pays and who doesn’t.” Ability to pay isn’t the same thing as actually paying, and what insurers care about is the latter. Many folks – especially young adults – have the ability to pay but choose not to do so. They get no coverage.

But further pondering of your point leads me to look beyond such nit-picking to see fascinating possibilities. Not only insurers, but all producers who greedily refuse to supply persons who don’t pay should be set aright. Now I’m sure that you don’t ration the supply of the books you write according to any criteria as sordid as requiring people actually to pay for them. But our society is full of people less enlightened than you.

For example, the typical worker rations his labor services according to who pays and who doesn’t. That must stop. Oh, and supermarkets! Every single one rations groceries according to who pays. Likewise with restaurants, clothing stores, home-builders, furniture makers, even lawyers! You name it, rationing is done according to who pays. Indeed, my own county government has been corrupted by this greedy attitude: if I don’t pay my taxes, the sheriff takes my house – effectively booting me out of the county merely because I didn’t pay for its services.

Preposterous!

I look forward to your changing this selfish and unfair system of rationing that for too long now has kept Americans impoverished.

Sincerely,
Donald J. Boudreaux
Professor of Economics
George Mason University
Fairfax, VA 22030

Data contradicts info used to overhaul health care

"...fewer than one percent of Americans enter bankruptcy each year. Of those, only three to five percent are plausibly bankrupt due to medical debt. These numbers present the inconvenient truth that our health system is not leading to bankruptcy in America.

The Himmelstein study paints a picture of an American middle class that even with health insurance coverage is being bankrupted by health care costs. The share of bankruptcies attributable to health care costs rose by 50%between 2001 and 2007, according to the study. The message is that rising health care costs bankrupt the insured middle class as well as the uninsured lower class.

The only problem is that the study is fatally flawed. Dr. Himmelstein is a co-founder of Physicians for a National Health Program, an organization that describes itself on its Web site as "the only national physician organization in the United States dedicated exclusively to implementing a single-payer national health program." An additional Harvard coauthor, Dr. Steffie Woolhandler, is co-founder and secretary of the organization. Even though the article states on the front page that the authors have no conflict of interest, two are self-declared activists for single-payer health care, and they have twisted the data to fit their cause."

(snip)

"A study by the Department of Justice examined more than 5,000 bankruptcy cases between 2000 and 2002. It found that 54% of bankruptcies involve no medical debt, and more than 90% have medical debt of less than $5,000. Even among the minority of bankruptcies that report medical debt, only a few have enough to cause personal bankruptcy."

http://www.realclearmarkets.com/articles/2009/07/30/the_medical_bankruptcy_myth_97335.html