The Lie of Julia

So, the Obama campaign has just released a step by step account of how great the president’s policies are for a girl, from cradle to grave. There’s a problem though. This “Life of Julia” not only looks at Obama’s policies through rose-colored glasses, but it looks at them through rose-colored glasses while hallucinating.

Let’s start at the beginning. The website claims that programs like Head Start will help Julia prepare for kindergarten. Well, first off, this is not Obama’s program. It was begun under President Johnson in 1964 and expanded in 1981 under President Carter. Now more to the point, the Department of Health and Human Services found in 2011 that, “Though the program had a ‘positive impact’ on children’s experiences through the preschool years, ‘advantages children gained during their Head Start and age 4 years yielded only a few statistically significant differences in outcomes at the end of 1st grade for the sample as a whole. Impacts at the end of kindergarten were scattered…’”. The website says that Romney would cut programs like this by 20%. Good! This is the kind of program that should be cut. It makes minimal difference in the short-term and negligible difference in the long-term. In fact, I’ll go further and say that it should be eliminate altogether.

Next, we get to age 17. The campaign claims that “the new college- and career-ready standards” that Julia’s high school would have as a part of the Race to the Top program provide her “the classes she needs to do well”. So, after the debacle of No Child Left Behind, we are still sticking with federally mandated “standards” as the key to success? Excuse me if I do not buy it. The campaign says, “(t)he Romney/Ryan budget would cut funding for public education to pay for tax cuts for millionaires”. Well, actually, they are paying for across the board tax cuts that stimulated growth until over-spending and the government-facilitated housing bubble reversed said growth. Also, public education is a local and state issue. To send federal money to it (which will always have strings attached by the nature of politics and government grants) is to perpetuate the same problems we have seen in the school systems for years.

Then at age 18, Julia is helped through college by the American Opportunity Tax Credit. Now, the basis that the Obama campaign has for saying that Romney would let this expire is his pledge to roll back the failed stimulus package (which this was a part of). What the president’s campaign fails to mention is the accompanying elimination on long-term capital gains taxes for those making under $200,000. This calculated omission aside, I want to critique this Tax Credit on one thing. It was used by the president and by Congress as a tool in the War on Drugs. If you are convicted on drug charges, you are ineligible for the tax credit, but if you are a murderer or a rapist, by all means receive the tax credit.

Now, Julia is 22. She has undergone surgery, and because of Obamacare, she is still able to be on her parents’ insurance plan. How could anyone critique this?!? Well, it’s fairly simple actually. By mandating that all insurance companies allow this, the federal government increases costs across the board, where they were previously just on those who chose to keep their children on their plans. If instead of going with more government intervention in reform, the government had freed up the market, the option to stay on would have arisen to the extent that would meet demand, and those who did not make that choice would not bear the cost of higher premiums caused by this mandate. Also, freeing up the market to compete across state lines would have lowered these costs, even for plans that keep children on their parents’ plans.

Now, at age 23, Julia is able to stand up for her “right” to equal pay. Please! First off, rights do not come from statutes, so to call equal pay acts “rights-giving” is absurd. Now, we get to the question of whether the government should be able to decide the pay of employees working in private firms. There is absolutely no legal basis for this in the Constitution, and simply the idea that the federal government could micromanage individual firms is quite frightening. I hope that Romney does not come out in favor of it (since as the President points out, he has not yet given a position), because it is just another example of how a Progressive cause looks good on paper until you look at the unintended consequences.

At 25, the President claims that his nationalization of the student loan sector makes “[Julia’s] student loans… more manageable”. However, let’s say that Julia graduates into Obama’s economy, with its 8.4% unemployment, 18.3% underemployed (These are Gallup estimates to include underemployment. Bureau of Labor Stats has unemployment at 8.1%). Now she is out of a job, and like so many others is so disaffected that she drops out of the labor market. She cannot get away from these debts by filing for bankruptcy like she could when banks ran the student loans business. Now, the IRS will garnish her wages if she ever were to get a job. In short, I would rather have a private bank after me for money, than the IRS (which could potentially throw you in prison)… Call me crazy.

Now, Julia is 27, and she is benefitting from having birth control covered by her insurance. However, because this was mandated for all insurance plans, Julia did not have the choice to not pay for birth control since it is paid for in her premiums. She is unable to choose to put that money elsewhere. In a free market, birth control coverage certainly would have arisen as an option for those who chose it (as Julia might or might not have done). What also would have been an option is a cheaper emergency-only plan that would allow her more income. (And oh, by the way, if she does not buy insurance at the increased cost, she gets fined).

I’m going to skip to when Julia is 42 to avoid the redundancy of the two in between (which deal more with education and healthcare). She has started up a small business. Supposedly, small-business loans help get her business off the ground and she is able to employ people and grow the economy. In reality, however, Cronyism in the federal government has created regulatory environments hostile to small businesses, tax policies that favor big corporate donors, and a patent system that makes small business innovation nearly impossible. So if she were truly able to do this, she would be the exception today.

Now at 65, Obama claims that his preservation of the status quo in Medicare has guaranteed her a high level of care. However, by refusing reforms favored by Romney and Rep. Ryan, Medicare reimbursements are miniscule, and few doctors still accept Medicare patients. Those who do have huge waiting list (since to make even the slightest profit, they must see patients in extraordinary volume).

Then at 67, Julia retires, however, assuming that she began as a part of the generation currently in college, she is sad to find that the Social Security “Lock Box” was looted by big spending politicians like President Obama, and she receives just a pittance compared to what she put into the system, if she receives anything at all.

8 comments

  1. Can you cite to where Reagan increased head start in 1981?

    Can you also point to any medical system where the free market has created the promises of lower costs that you talk about? Because I can point to numerous types of medical system that involve more government regulation but dramatically save consumers and taxpayers money while providing better health outcomes (Canada, France, Japan, Switzerland, Netherlands, Taiwan, Germany, etc). I’m not arguing those systems provide better care than someone with millions of dollars to spend on healthcare (those people will always be free to spend more money on health care), but overall, those systems are superior to ours- which I would argue is burdened not by government regulation, but by the profit motive which rewards companies for denying health care. Why would any insurance company insure someone with a pre-existing condition in the free market?

    And another note- we already have socialized medicine, and Reagan gave it to us. I want to say it’s surprising that most conservatives don’t realize this, but it’s not. The Emergency Medical Treatment and Active Labor Act of 1986 provided that anyone who needs emergency care must receive it, regardless of ability to pay. So by allowing people to go without health insurance, this law still requires us all to subsidize their emergency care, which is probably the most ineffective way of providing health care. How do Republicans propose to deal with this? Repeal that act? During the health care debate, I only heard the tort reform and selling insurance across state lines, which are legitimate proposals but are drops in a bucket and not serious, comprehensive solutions to the biggest fiscal challenge in our future. The ACA is virtually what Dole proposed, what Romney implemented, and many other conservatives pushed for- conservatives now simply don’t want to give the President an legislative victory and proposed no real solution to one of America’s largest problem. I’d love to hear how well you think Bush dealt with the challenges to Medicare and the uninsured (particularly the unpaid for expansion of drug benefits).

    1. I would like to reply to your comment ‘I can point to numerous types of medical system that involve more government regulation but dramatically save consumers and taxpayers money while providing better health outcomes (Canada, France, Japan, Switzerland, Netherlands, Taiwan, Germany, etc.’ I’m a Canadian and have grown up with ‘socialized’ health care and right now our health care sucks big time! Yes, it’s ‘free’ but I’ve discovered you get what you pay for. We have huge wait times, a shortage of doctors because apparently the good ones go stateside because they make more money. Socialized medicare is not the answer, having lived it, I believe is unsustainable for the future and provides inadequate health care.

      1. First, socialized medicine isn’t “free”, it’s paid for by taxpayers. Secondly, having a shortage of doctors and wait times for some things is better than having no health care at all (see the 45 million + uninsured Americans and medically-bankrupted families). I was on the UK’s NHS when I lived there and it was phenomenal (but I don’t think anecdotal evidence should be given much weight).

        Canadians doctors go to the US where doctors/hospitals/insurance companies are making fortunes on a terrible, for-profit system which is unsustainable. Compare our health care spending and deficit to Canada’s, and you’ll see why our system is not sustainable: http://www.washingtonpost.com/blogs/ezra-klein/post/a-larger-welfare-state-can-mean-a-lower-deficit/2011/08/25/gIQAkL9ufO_blog.html

        You also ignored the fact that the US already has socialized medicine, we just have one of the most inefficient forms of it. But most importantly, you had no viable alternative, unless you think the American system is just incapable of being improved upon.

    2. Source is at the bottom. I was skimming, saw 1981, and assumed Reagan. Turns out it was at the tail end on Carter’s term, however. I will fix that inaccuracy as soon as I’m done with this reply. I was not defending the expansion (in fact, I suggested even deeper cuts), so I don’t see it changing my argument.
      Free markets lower prices. That has been fairly well established across markets. The fact is, however, that governments tend to try to control healthcare more than other industries to look like they are helping their citizen’s health, so completely free markets are few. when they become more freed, however, cost goes down. As far as why a company would offer coverage of pre-existing conditions, gaining market share or covering large groups like that to reduce risk are just two reasons.
      Next, I take issue with openning insurance across state lines is a “drop in the bucket” or “not serious” since it breaks the system of nearly monopolized state markets, which drastically drive up prices.
      Notice, please, that I did not praise the overall approach of republicans towards healthcare, because you’re right, they have at times rejected free markets.
      http://www.advocacyoncall.org/education/head_start/

      1. I agree it doesn’t undermine your overall point, it just makes me wonder about other facts in your argument. Like when you say the Head Start gains dissipate and the program deserves to be cut. Unlike your Reagan attribution, it’s partially correct, but doesn’t tell the whole story and is misleading, since actually Head Start produces meaning long-term gains in children who did Head Start vs. those who did not. Head Start participants are significantly less likely than siblings to repeat grades, to be diagnosed with a learning disability, or to suffer the kind of poor health associated with poverty. Head Start alumni were more likely than their siblings to graduate from high school and attend college.

        http://www.people.fas.harvard.edu/~deming/papers/Deming_HeadStart.pdf

        If you feel like telling a more objective, evidence-based view of Head Start in your article, feel free to include that as well.

        Your argument about people with pre-existing conditions benefiting from a free market make no sense. These people cause insurance companies to lose money- why would a company try to gain the market share of people that make them lose money? People with pre-existing conditions are by definition “high-risk”, so why would a company seek to “reduce their risk” by covering them?

        Health care is simply not like any other good, and can’t be treated like them. If you get in a car crash and pass out, you will wake up in a hospital and involuntarily be purchasing health care.

        http://www.washingtonpost.com/blogs/ezra-klein/post/why-libertarianism-fails-in-health-care/2011/08/25/gIQAA4VkSK_blog.html

        By the way, selling insurance across state lines absolutely is a drop in the bucket. The CBO scored a 2005 bill that would allow that and they concluded that such a reform would not change the number of uninsured, and it would save the federal government about $12 billion from 2007-2015. That is not a substantial fix to a broken system. And the ACA does allow insurance companies to sell across state lines through interstate compacts.

  2. Also, “big-spending presidents like Obama. Do you think there is a difference between presidents like FDR and Obama who are trying to spend more so we can reduce long-term deficits by not falling into an austerity trap and slow growth (which would ultimately make our fiscal picture even worse in the long run), and presidents like GW Bush who 1) dramatically cut revenue 2) while expanding unfunded social spending and 3) committed us enormously expensive, open-ended, unpaid for wars.

    I think there’s a big difference between the two, but I’m guessing you disagree. Maybe you might agree that the Clinton administration was more fiscally responsible than the GW Bush administration?

    1. I am a Ron Paul Republican. So, no, I do not support Bush’s wars or expanded social welfare programs. However, cutting taxes actually boosted overall revenue before government facilitated (and bank facilitated) bubbles crashed the housing market.
      Clinton became more fiscally responsible only when a republican legislature forced him to. So, yes, the mid- and late- 90s were more fiscally responsible, but no, it was not solely Clinton.

  3. The two things that most helped achieved the fiscal surplus that Bush and GOP wasted was 1) raising taxes and 2) cutting the bloated defense budget. Gingrich and the GOPs fought Clinton on both these things. Obama is facing the same problem, since the GOP are not fiscal conservatives but somehow got that reputation (I guess because they say it so much?).

    So I imagine as a Ron Paul Republican, you are much more in lines with Clinton/Obama and the Democrats on defense spending at least.

    As for the Bush tax cuts actually boosting revenue….that is too far from reality for me to handle.

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