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Bulls & Bears
On Saturday, April 17, 2010, Brenda Buttner was joined by Gary B Smith, Tobin Smith, Eric Bolling, Todd Schoenberger, and Christian Dorsey.
President Obama Says to Thank Him for Tax Cuts; But What About Future Tax Hikes?
BRENDA BUTTNER: Teas Partiers teeing off after the president takes a shot at them:
(BEGIN VIDEO CLIP)
PRESIDENT BARACK OBAMA: "I've been a little amused over the last couple of days where people have been having these rallies about taxes, taxes. You'd think they would be saying, thank you!"
(END VIDEO CLIP)
BRENDA BUTTNER: The Tea Party response? "No thanks." Some now worry that the president ignoring them is a signal that major new spending and tax hikes are coming. But, are they right?
ERIC BOLLING: Brenda, tax hikes are on their way. The Bush tax cuts expiring? That's a tax hike. VAT tax, cap and trade tax… how about taxes on income investment, medical taxes, taxes are on their way. The president has to raise taxes; it's the only way he can support a $1 trillion health care plan, $1 trillion on stimulus, $100 billion on job creation every two months. What's the story? Taxes have to go up and they're on their way up now.
BRENDA BUTTNER: Why should we say thank you to the president, Christian?
CHRISTIAN DORSEY: Well, Eric wants to talk about what might happen, I'd rather talk about what has happened. And what has happened over the last year is President Obama has led a stimulus package that has created 2 million jobs, a health care bill that's going to reduce the deficit, not increase it. The president is right in addressing folks who ought to be thankful because 95 percent of Americans have received a tax cut and no American has received a tax increase under Obama. I'm just as perplexed as he is.
BRENDA BUTTNER: $13 a week, I think, Tobin?
TOBIN SMITH: Look, you know I've spoken to a lot of these Tea Partiers and they can do math. Now, here's two weird ones. Number one. Under "Obamacare" and where we're going, about 75 – 80 percent of all Americans over 18 would take more cash or services out of our federal economy or spending than put in. Number two. You talked about 95 and 5. Well, 5-10 percent of Americans are paying for the other 90 – 95 percent. So they know taxes are coming because there's 18 new taxes that came in the Obamacare bill. There's 118 new bureaucracies just in that. How do you pay for it? It's going to go to the rest of the people because the rich people are tapped out.
BRENDA BUTTNER: Gary B, are you saying thank you?
GARY B SMITH: Oh, yeah. I'm saying, thanks for nothin'! (laughter) A couple of points that Christian made, let me address. First of all, President Obama bills these as tax cuts. When most people think of tax cuts, they go to their tax form and they see their marginal rate reduced. Getting $200 in your pay check once is not a tax cut. If you ask most people, "Hey, were your taxes cut last year?" They go, "No." So that's number one. Number two, Christian can say, let's not look in the future. Well, unfortunately someone's going to have to look in the future. Just on this year's deficit alone, the Tax Foundation estimates you'd have to increase taxes by 100 percent. That is double across the board for every income bracket, not just the rich, who I'm sure Christian feels should pay, but across the board; that's just this year's deficits. Finally, the current budget will reduce deficits. I'll tell you what, let's come back in a couple of years. If you really, really believe that, we'll see without any tax hikes, which I'm certain, like Eric said, are coming and coming across the board. Everyone's going to feel it.
TODD SCHOENBERGER: Toby and Gary are both right. When you start to take a look at the numbers here and how many people are paying their fair share of taxes, the idea that a tax cut has taken place… you know, $200 in your pay check is just a gift; that's what we're looking at here. The bottom line is this president is putting us in a position right now because of his spending… also these spend-happy liberals… they're putting us in a position and now they're coming back and saying, "Hey look, we need to tax you more because if we don't, that's the end of the United States of America."
Volcanic Explosion Teeing Up a Spending Explosion Here?
BRENDA BUTTNER: More spectacular pictures from that volcano in Iceland. Now, a climate scientist is blaming global warming and warning we'll see more eruptions around the world. Gary B, you say something else is about to explode because of this?
GARY B SMITH: We're going to have a lot of hot air, that's for sure, and it's all going to be on Congress. The Obama administration said it right up front: any one of these crises is too good of an opportunity to waste. You're going to see cap and trade again on the table. That's a huge, huge tax bill. Studies have shown that if they pass this, the impact on the GDP will be to cut it by 2.5 percent. So one, we're going to cut down the GDP, two, we're going to lose jobs, three, it's going to be a tax on all of us, and four, we don't know if any of this cockamamie science is going to work. The climate temperature around for the world for the last 11 years hasn't budged an inch.
CHRISTIAN DORSEY: Cap-and-trade is going to cost money. I'm not going to deny that. Any objective analysis concludes that it's going to cost more than it does today; it only makes sense. And it only makes sense that some of those costs will be passed on to consumers. But, what isn't talked about is the bill actually provides for offsetting the costs of lower income people and most importantly cap and trade finally brings to light that carbon emissions have a social cost as well. We've never quantified those before, so you have to add those to the mix to figure out if this is a good or bad thing. The benefits will be at least equal to the cost, some say four times better.
TOBIN SMITH: Christian, I am not a scientist nor do I pay one on television, but you're with the Economic Policy Institute so I would assume that if you applied econometric models, if you looked at actual, real data, you would know that the actual cost of this carbon thing, just like health care, would be significantly more, number one. Number two, you don't factor in the job destruction. And number three, most of all the assumptions in there, economically speaking, are so rose-colored that they would again fail the light of day if they were held to real scrutiny.
ERIC BOLLING: Christian said it only make sense. It makes no sense. Here's why: It could be close to $1 trillion per year, anywhere from between $1500 - $4000 per family. It's a tax on every American consumer. And by the way, if there's a cap and trade tax in the US and not somewhere else, businesses will open up somewhere else. This is a bad idea for consumers and businesses.
TODD SCHOENBERGER: It's another reason to spend. It doesn't matter if you have a volcano in Iceland, it's just a flavor of the week, it's another reason to put something together and spend more money. We're giving them the opportunity. What's the next catastrophe that's going to enable the administration to do something else? And to say that the deficit is going to go down is a laugh. You don't cut the deficit by raising taxes; it's impossible.
$16.5 Billion in New Pork Spending Is Good for Economy?
BRENDA BUTTNER: This is gonna make you squeal. The Citizens Against Government Waste revealing more than $16 billion in new pork spending; everything from $500,000 for tree snakes in Guam to more than $2.5 million for researching potatoes. And Christian, you say not all government pork is bad pork and can actually be good for the economy?
CHRISTIAN DORSEY: Pork can be good for you. I know this is an opinion shared by all of you. (laughter) Not all pork-barrel spending earmarks are bad. Much money goes toward the development of hospitals and clinics and critical infrastructure projects and creating jobs in local communities. I know everybody hates earmarks except for the ones directed to their local communities. So let's really put this in perspective. What people are really concerned about is that this stuff takes place out of the light of day, it seems kind of shady. Congress would be well-served to make this more transparent. But, let's not confuse the issue. You get rid of earmarks, you get rid of a lot of necessary things.
TODD SCHOENBERGER: I completely disagree. When you start talking about pork and all these other non-essential things that are taking place, I do believe that all of us need to sacrifice one way or the other. I'm not entirely sure, I know the president is telling us that the economy is back and everything is great and the markets are up and that's super, but you still have people who are sacrificing, who are struggling. Do we need to pay $500,000 for snake research?
ERIC BOLLING: There are a lot of congresspeople and senators on both sides of the aisle who frankly say, "I'm against all pork." And then once it comes out they say, "Eh, well, I'll take just this one." What pork really is… is buying votes from the constituents. Look, mandatory spending, defense, I get it. Police, roads, I get it. But this kind of stuff is just, "Hey, vote for me. I'm going to get that bridge for turtles and create a couple of jobs." Awful.
TOBIN SMITH: Let's just say we had a huge surplus and we didn't have two wars going on… ok, maybe a little $16 billion here and there, I understand. But listen, $349,000 for poop reclamation in North Carolina… let me tell you, I love that state, there's a lot of pork down there, $349,000 ain't gonna remove much poop.
BRENDA BUTTNER: To reclaim poop?
TOBIN SMITH: Yeah, it's waste management. You can't even call it poop removal, it's waste management.
GARY B SMITH: I'm going to agree with Christian in this case. Pork can be good. There's one great example, the Portsmouth Music Hall took $1 million in federal money and says it's going to create $5.5 million a year. I'm sure it's a great place. But here's the problem: Who says that the Portsmouth Music Hall should get my money? That $1 million may have been better spent elsewhere that the market determines, not some Congressman. In fact, if the Portsmouth Music Hall and all these other private things were so valuable, they would be able to generate the funds themselves.
Predictions
GARY B SMITH: Ray Lahood a cyclist's new BFF! "HXL" rides up 50 percent in 12 months
TOBIN SMITH: Minute clinics become the rage! "CVS" prescribes 40 percent gains by 2011
TODD SCHOENBERGER: Goldman shakes off fraud charges! "GS" climbs 20 percent in 3 months
ERIC BOLLING: Iceland volcano boosts cruise business! "RCL" erupts 30 percent in 1 year
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Cavuto on Business
IRS Makes Billions in Errors Even as Role Set to Expand?
Scott Martin; Astor Financial: What a great situation, we're hiring more auditors to go after guess who, it is individual.
Meanwhile we're taking down the examinations of these big corporations about 33 percent of them with assets of 250 million or more. That's a big issue for the individual taxpayer.
Gary Kaltbaum, GaryK.com: I don't think the IRS is incompetent. I think they do a fine job. There's always going to be slippage out there. But I do believe the code is skewed and that's what's coming from the legislators. The code is going to continue to be skewed against the consumer. If you ever looked at the book it's like an encyclopedia. Every write-off under the sun. It's only going to get worse with all the rule that are coming down the pike.
Leigh Gallagher; Fortune Magazine: It might get worse. Nobody would look at the tax code and say this is awesome. It's complicated, it's a thicket of problems. It's difficult to manage. It's a beast. I think it's going to affect everybody, corporations as well as individuals. You know, a big reason people are sitting on cash is because we're in a recession.
Dagen McDowell, Fox Business Network: But you hit it, Charles. It is what the IRS is being made to do. And what is it really disguises? Let's lay it out. All the tax credits and breaks, if you want to change taxes, you cut rates period and clean it up and level the playing field. This is just government spending under a different name. This is spending that's going out the door. Our public debt is taking over the size of the economy. This is spending, period. Pure and simple. Don't call it a tax break.
Will White House's Pro-Union Rule Help or Hurt Jobs?
Gary Kaltbaum: Unions are getting their money's worth. Charles, 85 percent of construction worker force is non-unionized but they're telling that 85 percent to take a hike. Whatever happened to a better bid or a better company who can construct something better? Whatever happened to the level playing field that this administration talked about before they came in? All they're doing is give always to the good buddies, total favoritism and cronyism a will hurt the construction industry.
Scott Martin: Isn't that funny, Charles? When those things dried up, the construction industry is adding jobs. Once the government got out of the way -- it's it. The economic impact is terrible. It's higher costs, lower profits and at the end of the day, fewer jobs by the corporations. So it doesn't work out well. The fact that the union -- non-unionized is so high, it's best to leave it the way it is.
Dagen McDowell: This exemplifies, Charles, something even more dangerous we've talked about on this show. That's the vicious cycle developing where the unions enrich the democrats and democrats enrich the unions. You grow the unionized workforce in government. They get more money and then they give that money to -- the democrats give it back with more power. This looks like just again a slice of what is card check with a mustache on. It's card check in disguise, away for unions to get more power. There are more union workers in the government than in private.
Leigh Gallagher: These are highly controversial and it's surprise this hasn't gotten more headlines. But in theory there's a positive benefit. They're supposed to -- the contracts go -- it is jobs go to people in the community to sport local community. The people who work there, live there, spend money in the community. The problem is that in a job market like we have, there's people everywhere. In a tight job market, sorry, in a tight job market you can't find enough people.
Force Americans to Volunteer to Do Government Work to Cut Costs?
Dagen McDowell: It's not a bad idea because it puts the burden or -- even if you want to call it a burden, on the individual and it takes the power out of the hands of the government. You see -- it's easy to dismiss it locally. Like in Colorado Springs, but if you have everybody in the country starting to think the same way, then you could put the power -- you take the money and the power out of the hands of politicians.
Leigh Gallagher: Well, look, I have no problem with a jumpsuit and volunteering but it's rather ridiculous because I would rather pay a tax than clean a streetlight. I value my time and – if I'm going to volunteer, I would rather volunteer for something I want to do like teach journalism to kids or help the elderly or something that might actually make me feel good.
Scott Martin: I'm going to Colorado Springs and I'm packing my work boots. Yeah because I think it's a good thing. I'll see if they let me on a John Deere, people in the city itself wanted this. They voted for this. This is something they wanted so that's the issue. They want to give it back to the people and don't want the government mining around.
sure there's a lot of free riders, the top 10 percenters, like the income tax, but it gets the government out of the way and that's what people want.
Gary Kaltbaum: Don't forget, if somebody's cleaning the sidewalk and cuts their knee, here comes the lawyers. This is all well and good on a local level a community level. We need to clone government and New Jersey's Chris Christie. Really doing something about cutting government and not taking crap from anybody, saying this is how much we've been spending an how much we're going to spend. Fight me on it. That needs to be done. Remember, Bill Clinton's last federal budget was $1.8 trillion. This year it's $1.6 trillion wasn't a deficit.
'D.C. Lesson Stocks': Companies Cutting Costs and Making Money
Gary Kaltbaum: Fedex (FDX)
Leigh Gallagher: BHP Billiton (BHP)
Scott Martin: Philip Morris (PM)
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Forbes on Fox
On Saturday, April 17, 2010, David Asman was joined by Steve Forbes, Rich Karlgaard, Bill Baldwin, Neil Weinberg, Stephane Fitch, Mike Ozanian, Quentin Hardy, and Victoria Barret.
Flipside: $0.15/Gallon Gas Tax Isn't Big Enough!
DAVID ASMAN: The biggest tax hike ever on the middle class may be coming to a gas pump near you. The Senate unveiling its climate change bill (on April 26th) and word on Capitol Hill is, they want to pay for it by jacking up the federal gas tax by $0.15 a gallon. That's enough to push the national average for a gallon of gas over $3.00. Now for our Flipside, someone at Forbes says, hike that tax even more!
Hi everybody, I'm David Asman. Welcome to "Forbes on Fox." Let's get the Flipside from Steve Forbes, Victoria Barret, Rich Karlgaard, Mike Ozanian, Quentin Hardy and new to the show, Forbes Chicago Bureau Chief Stephane Fitch. Stephane, what a way to make a premier—by offering to hike the gas tax even higher!
STEPHANE FITCH: The $0.18 a gallon tax that we have now was a 20 percent hike in 1992. Not raising it has been one of the most irresponsible things Congress has done. It's a joke. Lifting it by $0.15 is a start, but if you really want to get off foreign oil, you have to get more serious than that.
STEVE FORBES: No time is a good time to be hiking taxes. This raises the cost of living and raises the cost of transportation, which is a drain on the economy. You might call it a pain in the gas. We have 4 million miles of highway in this country. What are we going to do, use skateboards? What's this thing against driving—we're a free people! And in terms of reducing our dependence on foreign sources, how about going full-bore on natural gas in this country? How about nuclear power and the like? Let's get serious instead of finding new ways to pick people's pockets.
MIKE OZANIAN: President Obama is trying to turn us into Europe and if we want to get serious about this so we all drive around in those tiny little cars where we have no room, we have to raise the gas tax even further—maybe even to $2.00 or $3.00 a gallon to get the price up to $6.00 or $7.00 a gallon. That will actually cut back on people buying gasoline.
VICTORIA BARRET: I have been in favor of a gas tax before on this show because I do think it's a great way to reduce our dependency on foreign oil, so I agree with Mike and Stephane in that sense. But I agree with Steve more in the sense that this is not the time to do it. I mean, when you're looking at the unemployment levels that we have, it is not the time to implement what is essentially a broad-based tax on the American economy.
QUENTIN HARDY: Can we please ban this as a middle class tax hike? This affects the rich and poor alike, and I'm okay with that. Yes, we're a free people, but if you want to motor across our purple mountain majesties and fruited plains, you need highways, emergency vehicles, cops, and yeah—you have to pay for those things, and you pay for them with taxes, and I'm okay with that. If it hurts people and makes them drive less, that also hurts Middle East despots, and I'm okay with that too.
RICH KARLGAARD: This is a tax on the Joe the Plumber. Meanwhile, the President of the United States has a 747 which burns one gallon of Jet-A fuel per second. President Obama's fuel load is about 7 million gallons per year. I'd like to see him personally pay $0.15 per gallon.
In Focus: President Obama's New Health Care Law Is Causing Doctor Shortage in America. Was That $1 Trillion Money Well Spent?
DAVID ASMAN: We've been warning about this. A new study came out this week showing that the United States is looking at a massive doctor shortage, to the tune of 160,000 over the next 15 years. It's a shortage that could be so severe that 28 states are ready to give nurses a lot more power than they have now. Medical experts blame the shortage on the new $1 trillion health care law. So Steve, is this money well spent?
STEVE FORBES: Instead of $1 trillion it's actually $2 trillion in the real world and no, it's an absolute disaster. It's Soviet-style medicine—create artificial shortages then try to get people to come in to fill the gap. Already in medicine, nurses are taking over more and more of what have become routine practices, which is the way the natural, free-market should work. But when the government creates a shortage, do you want your kids or your grandkids with a serious condition to go before a physician who's not fully trained? That's what we're looking at. And the elderly are looking at the same thing.
QUENTIN HARDY: The health care bill was passed a couple of months ago. Doctors take years of education. You're telling me that 6 or 8 years ago they saw this coming and decided not to go to school? No. The fact is, we have fewer doctors per 1,000 people than the U.K., than France, and than most countries with so-called socialized medicine. Maybe the turn-off is the tyranny of our insurance-dominated system.
VICTORIA BARRET: The shortage that you're talking about has been a problem for a while and it's self-inflicted because we limit the number of people who can become doctors severely. There are many more kids who want to go to medical school and take that long road than actually get in. That means a lot of them get their training offshore. The fix is opening up the schools to more students, but I do think this health care bill will make the shortage even more severe.
STEPHANE FITCH: Think about this. There's a shortage of new doctors into the system. Hey, isn't that great? Maybe more people will go into primary care. Wouldn't you love to be a doctor? Wouldn't you love to have too many customers coming at you in the next 10 years? The new system is going to save lives and it will eventually save costs. Doctors are definitely allowed to turn patients away if they don't want them. If you can't handle them and you don't want all that new business, then just say no.
NEIL WEINBERG: Unfortunately, in terms of efficiency, this bill is dead on arrival. The problem is that we're trying to mandate what's going to happen in the system instead of allow the free-market to decide. One of the things that President Obama did, which was a big mistake, was bribe the doctors so that they would go along with this. What we need to do is open up the supply as well as the demand here, otherwise the market forces aren't going to be able to react and we're going to have this huge shortage.
Is New Report Showing $75 Billion Home Affordable Modification Program Was Big Waste of Money Proof Obama Administration Should Get Out of Housing Market?
DAVID ASMAN: This won't surprise the folks at Forbes. The Congressional Oversight Panel saying the President's $75 billion mortgage bailout program isn't working and it's wasting your tax dollars. Only a fraction of those in need have actually received money, and many of those who have received money are already back in foreclosure. Rich, is this more proof that the government has no business meddling in the housing market?
RICH KARLGAARD: Yes, this is more proof that the government just sets up moral hazards and creates situations where there is going to be fraud and waste. They tried to do what they thought was the right thing and bail out people who bought more house than they should have. What's really sad about this is it demoralizes the rest of the population that has played by the rules and been frugal, and winds up getting screwed by its own government.
NEIL WEINBERG: Talk about feeling like we're getting screwed—we bailout AIG, we bailout General Motors, we bailout Goldman Sachs, but we're going to throw people out of their houses? These homes are what support economies all around this country. There's also an ethical issue here. You're talking about throwing people out on the street. I'm sorry but if we can put money at work for all of these other causes, I think we can put money at work to keep people in their homes.
STEVE FORBES: Government bureaucrats go where the votes are, as do politicians. They make no distinction between people who may have lost their job or may have an illness and where something can be worked out, and those who are flippers and speculators and put no money down and should never have been in the house in the first place.
QUENTIN HARDY: I didn't see people complaining when the Obama's payouts to the banks kicked in and the market didn't punch below 6,000 like it was going to. That seems to have made everyone pretty happy. In the time since then, 1.1 million Americans have applied for relief, the kind of quid pro quo the government was expecting from the banks for all the sugar they got, and less than 15 percent have had any relief. That's what the criticism is about and that's where the inefficiency is. The banks are not moving even though they got paid off with cash, stock payments, and low interest rates. It's time for them to make a move.
MIKE OZANIAN: We're just creating another housing bubble, that's all we're doing. The Federal Reserve has printed a lot of money to support mortgages. Obama has borrowed a lot of money to support mortgages. Now they are proposing to have the Federal Housing Administration, through our taxpayer dollars, write down the principal of mortgages and pay-off banks, even for people who aren't in foreclosure. This is a huge hole in the economy.
Informer: Stocks That Will Keep Dow Moving Towards 12,000
NEIL WEINBERG: Verizon (VZ)
MIKE OZANIAN: Chevron (CVX)
STEPHANE FITCH: Bank of America (BAC)
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Cashin' In
Lamakers Voting to Extending Benefits Making Jobless Rate Worse?
Tracy Byrnes, Fox Business Network: We can't. Cheryl, look, at this point I make more money on unemployment. A perfect example. In New York, Home Depot is hiring, you can go get a job for $15 an hour. Why would you? Your unemployment check is $405 a week. I make more money sitting on my butt. This is doing nothing for the recovery.
Julian Epstein, Democratic Strategist: Most of the data shows that people get about 40 percent of what they make when unemployed and they get benefits, 40 percent of what they normally make. The idea that this is creating some disincentive for them to go back to work is really not a very solid argument. It's kind of been debunked repeatedly. Secondly, a fact is a lot of people can't find jobs. If they don't get benefits they can't pay the mortgage and they can't feed their children. The individual hardship would be enormous and the economic hardship is excess baited because they won't put back in economy.
John Layfield, www.nutritionmarket.com CEO/Owner: Of course you are. I lived in Germany and saw it first-hand when people have huge unemployment benefits for long term. Larry Summers had no problem with this paper until he was a spit bucket cornerman for the administration. Then all of a sudden "Hey, the paper was taken out of context." The paper was the context. It had long term effects of unemployment and it was insurance and welfare. That's what Larry Summers said. Once he's part of the
administration and says, "Hey, that paper I wrote really wasn't a matter." Was he lying then or lying now?
Jonas Max Ferris, www.MaxFunds.com: It keeps the wages high. If there were no benefits they'd try to get a job. Let's be honest, but it would drive up the labor cost. You go to Home Depot and Applebees and they'll pick people to cut wages and they're trying to prevent that now. But is there a better way to achieve it with the government than giving money not to work? They could give money to work. Raise wages in the army…it's a valid concern, but the issue is not a good way to solve it. You can pay people to work for the government and pay them to join the army and get them out of the private market until that recovers. To pay them not to work is a bad solution to a growing problem.
Jonathan Hoenig, www.CapitalistPig.com: That's what this program does. This is a new deal program come back again to haunt us. Taking money from productive people and giving it to unproductive people. It creates dependence. Julian, I don't know if it creates many jobs but it creates dependence. People don't have to save or plan for the future. They have a benefit coming from Uncle Sam.
Wayne Rogers, Wayne Rogers & Co: Here is nothing in this that talks about job creation. You are not creating jobs by doing this. This is a purely, you're right, social way to say to let somebody down easily who has lost a job to get them a break to try to transfer to another job. When you come down to it, it's a question of incentive. If you have an incentive not to work and you can make almost as much money, even if it's 40 percent, Julian, maybe it's a lot better for me not to work than it is to work. In other words, if I have no incentive to do that, that is what is wrong with the program. The program is fine, it's a wonderful program from a social point of view. But it doesn't help drive job productivity back to the economy.
1-in-4 Heart Doctors Ordering Unnecessary Tests in Fear of Being Sued: Proof New Health Care Law Won't Drive Down Costs?
John Layfield: Absolutely. This administration wanted to pass landmark legislation, they don't care if everybody wants it or if the system is broke. You have 32 million people going in the broken system. It does not address frivolous lawsuits or tort reform. We have one out of every five American males that are unemployed in the country that can't even go to Applebee's and this administration came out yesterday and said let's go to Mars next! This is what happens when detached ideologues get stuck in power who have never run a business. A mess for health care system.
Julian Epstein: I'm one of those Democrats that is actually for Tort reform. I think you shouldn't overstate the significance of Tort reform. I think the G.A.O. did a study that showed it may have upward pressure of $50 billion a year on premiums. That isn't a small amount. It's significant. But you have to define what you mean for Tort reform. I'm for screening out the frivolous suits and capping damages. But some of the Tort reform I remember when I worked on Capitol Hill in processing, some of the Tort reform proposals would be for example if a doctor were to amputate the wrong arm, you would be limited in damages to $750,000. Would anybody on the panel give up their right arm for $750,000?
Wayne Rogers: Massachusetts Medical Society did a study on this and they found that there is a waste probably in that of $1.4 Billion. This is not just the fact that you're lopping off the wrong arm by doing this, and the lawsuit, it's the test that you have to go through to be defensive about it and what the tests cost. It also means that hospitalization goes up because you are going to admit somebody to the hospital who may not otherwise have been admitted but you are afraid not to, because you're afraid you'll be sued. The fear of the lawsuit, not the actual lawsuit itself that causes this.
Tracy Byrnes: Wayne hit the nail on the head. We're a litigious society. All we do is sue. We are going to sue for everything. Some notion of Tort reform has to be discussed or it will continue to spiral. Doctors will be making a mere $15 an hour because that's all they'll have left after paying all the law bills.
Jonathan Hoenig: Cheryl, the reason it will continue to spiral is that the reform actually, of course, increases government. You know that junk lawsuits, frivolous lawsuits are widespread now and the government is a big player in health care. It will increase. I mean, everything will. NIH to the FDA, Essentially, the market doesn't self-regulate. For example, a lot of patients say sure, I'll take that medication. Heck, it's FDA approved. A lot of doctors perform unnecessary tests because, of course, someone else is footing the bill. Government as it grows, you're going the see the frivolous lawsuits more.
Jonas Max Ferris: Jurors of our peers don't know what they're doing, a whole other debate. There is very little that has to do anything with controlling cost because you can't pass a bill to control the health care cost because it offends people. We're lucky we got the Pigeon thing with the Cadillac tax. My god, giving people a break to get a $40 million health care plan. Don't cut that! The Tort thing is one of many things you can do to control health care costs. Forcing people to be healthy on government health care plan. Instead, we have increasing of spending, very little to control cost.
White House Saying Stimulus "Showered Billions on Taxpayers": But Did It Really Cost Taxpayers Money?
Jonathan Hoenig: Well, the President's unfortunately, his math is wrong. I think his philosophy is wrong. What he called "stimulus" is redistribution, right? Taking money from productive people, taking money that people earn and giving it to dependent children, cash for clunkers, first-time home buyers, all of his, very admirable social programs. Benefiting people who by and large don't pay taxes by charging people who by and large do pay taxes, i.e., productive people. It will create no new jobs because you don't create wealth by taking it from those who earn it and give it to those who have not. That's what the president has done.
Jonas Max Ferris: There were straight-up income tax breaks in the bill. The problem is they are going to cost more than they cost, because all hand-outs to people that aren't paid for by government somewhere else that are basically borrowed money from the foreign countries is going to cost more than the hand-outs so you're both right in the sense, yeah, this was a good year to pay taxes. You are going to pay less taxes this year than you did in any year in the next ten years but we'll pay for it in the long haul, borrowing money, interest on the debt, et cetera, et cetera.
John Layfield: The problem is we're spending money we don't have. Look, Jonathan loves to bring up Zimbabwe and accurately so. Get this, according to Gap adjusted measures we have 840 percent-something debt to GDP. The closest to us, we just passed Zimbabwe. We are the worst in the world. If we are a business we'd be shorted like crazy. Greece is 550. Somebody has to stop the morons on Capitol Hill from spending money we don't have.
Tracy Byrnes: What is helping the economy when close to 50 percent of the people who file tax returns don't pay any taxes? I file my return quickly and claim the refund, too. Those of us who owe money file at the last minute. It's not equitable. Wealthy are carrying a load of the people that don't make as much money, and it's got to stop. Because we can't afford to do it for much longer.
Wayne Rogers: I don't think it's a question about affording and all of that. That is what you are discussing. But the problem is one you haven't attacked and you haven't divided. That is the fact that this is money that is not budgeted for. In other words, Congress has used this as a bill to pork barrel everything they can, and it's not under the budget. Therefore, they have violated in a sense the Constitution by taking it out of the budget and saying okay, we are going to give Amtrak $1.5 Billion. We'll pay this and that. None of that is in the budget. It was put in this bill as an excuse and violation of the Constitution. And the people should throw all those people out.
Julian Epstein: 95 percent of the American public got tax cuts, $200 billion worth or 150 different types of tax cuts. Stimulus is working on the economy. We have gone from negative six to positive 3 or 4 percent growth. All the money we spent on the stimulus will come back to us. Guess what? It doesn't have to be paid for to increase the taxes elsewhere.
What Do I Need to Know?
Tracy Byrnes: Personal income fell 3.2 percent since Obama took office in January of 2009. He will raise taxes and it will get worse.
John Layfield: Samsung says don't watch 3-D TV and drink beer? What? Buy the stock (TAP).
Wayne Rogers: Well, the leading part of the recovery is back, and I like Agilent Technologies (A), trading around 35.
Jonas Max Ferris: Smithsonian is going to archive the tweets because Twitter tweets are not good enough. This is good for the hard drive maker like C-gate (STX).
Jonathan Hoenig: Mexican peso, for illegal immigrants and drug violence anymore, so buy (FXM), a strong buy.
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