DISCLAIMER: THE FOLLOWING "Cost of Freedom Recap" CONTAINS STRONG OPINIONS WHICH ARE NOT A REFLECTION OF THE OPINIONS OF FOX NEWS AND SHOULD NOT BE RELIED UPON AS INVESTMENT ADVICE WHEN MAKING PERSONAL INVESTMENT DECISIONS. IT IS FOX NEWS' POLICY THAT CONTRIBUTORS DISCLOSE POSITIONS THEY HOLD IN STOCKS THEY DISCUSS, THOUGH POSITIONS MAY CHANGE. READERS OF "Cost of Freedom Recap" MUST TAKE RESPONSIBILITY FOR THEIR OWN INVESTMENT DECISIONS.
DEBT FOCUS TURNS TO D.C. AS LAWMAKERS SCRAMBLE FOR A DEAL
Gary B. Smith: If you are on the debt super committee and you are on the fiscal austerity side, you are shaking in your boots right now. Ohio backed this union proposal, but what they really backed was bloated pensions, outrageous salaries, outrageous hiring practices, non-existent firing practices-the opposite of all of the things we need to turn this country around and show some fiscal soundness. Again, if you're on that super committee you just lost a lot of trump cards in your hand.
Tobin Smith: We have some hard decisions to make and I can appreciate if you were the beneficiary of these types of benefits you would not want to see them go away. That's not going to get us out of the hole here. From an economic standpoint, these cuts not only need to be made, they need to step up and go to the big cuts. Now, they're going to wuss out.
Jonas Max Ferris: I think this is a small microcosm of the same problem. Everybody seems to want a benefit structure of somewhere like Sweden, but they don't want to pay for it with the resulting high tax rates that those European countries have. That's the path to bankruptcy. You either have to vote these things down and have these cuts, or you have to raise taxes. The committee is going to say that. They are going to have big tax increases and they are going to have huge cuts. No one is going to want to do both of them.
Todd Schoenberger: Ohio is a big swing state, so when you're looking at the super committee the democrats know that they need to appeal to a certain base that's out there who want these entitlements. We heard this from the vote on Tuesday. When we're going forward we need to think big. We can't use the Ohio vote as the thing that will swing them. The problem is that the democrats are never going to compromise with the republicans right now on this and the republicans are willing to talk about possible tax revenues right now, but yet again we know that they want the cuts and the democrats are never going to do the cutting.
Susan Ochs: I think the message from the Ohio vote is that there is solidarity among struggling, middle class workers. There are a lot of middle class workers who are the government workers in Ohio and they're suffering right now. There are a lot of people who are really in sympathy for them and they don't want to see their rights stripped away. This was about collective bargaining and not wanting them to have to bear the brunt of the cost cuts right now.
MEDICAL DEVICE MAKER STRYKER CUTTING 5 percent OF GLOBAL WORKFORCE DUE TO HEALTH CARE LAW
Gary B. Smith: The CBO has already come out and said this is going to cost our economy 800,000 jobs. This is the same group that said employer-covered health insurance would go up. Since Obamacare has been signed, 4.5 million people have lost that insurance. I'm in doubt of the CBO's 800,000 number. I think it will be a lot more.
Tobin Smith: This is simple mathematics. I'll give you an example with our company. Our premium for 2012 is going to be up about 24 percent because when you took the stuff that we didn't cover and you add it in, someone has to pay for it. So, that's probably going to cost someone a job. If you take my company and multiply that by millions, you'll get job destruction purely under the idea that somehow we can just raise premiums, costs and mandates and won't have an economic effect. That's naïve and insane.
Jonas Max Ferris: There is a lot in the health care bill that is bad for the job market. The whole idea that companies have to provide health care, in general, is bad for the job market. However, corporations love to blame their troubles on something big that's going on. But, if you really think about this, a medical device company will have more demand for their products because there is going to be more insurance. There is a tax, but is there a tax on hip replacement stuff across the board? You're not going to lose market share to the other medical device company because they have the same tax. It's paid for by insurance, which more people are going to have. I don't believe it. I'm just not buying this excuse.
Todd Schoenberger: You're looking at a mandate right now. In the law, you're telling employers a number of things. One, they have to give preventive care issues and that's going to add cost. It adds to unit labor costs and premiums. The flip side of that is if any company does not wish to hire people or cut employees, they are going to end up raising those costs and adding those costs to consumers in the form of inflation. When that happens, you're going to have added costs that will make it more expensive to live. The health care bill is poison to the employment market, but also to the general economy as a whole. The irony of it all is that it's not making anyone else healthier.
Susan Ochs: There are fifty million people that are uninsured. When there is that high of a number in the system who are not being covered and using emergency services. That makes the entire system much more expensive. The estimated premiums were one thousand dollars higher just based on the cost of uninsured people in the system. So, if we could get rid of that cost that would bring the entire cost of the system down and then you will start to see premium reductions. It's not going to happen overnight. It will eventually happen.
OCCUPY WALL STREET PROTESTERS OPEN A WELLS FARGO BANK ACCOUNT -- THE SAME BANK THEY PROTEST AGAINST
Gary B. Smith: The irony is, they didn't just put it in a bank, they put it in a bank that accepted TARP money. Their whole thing is against the 1 percent. Wells Fargo is a prime example of being on the inside that got the money. Banks are convenient because they put together a business model that allowed them to make money and expand. That's what the Occupy Wall Street people should be keen on. They should want these companies to make a lot of money so that they can grow big and hire people that are camped out at these parks.
Tobin Smith: Does capitalism work? Absolutely. They created a product, you can call it the angst product. They are selling it every day and people are paying for it. I say mazel tov boys, capitalism really works.
Jonas Max Ferris: These banks have a very important purpose in America and yes, they got bailouts and many more would have failed if they didn't. But, at the end of the day, we need to have these banks because when someone gives you money you need somewhere to put it where it's safe, it's backed by the government. If the bank fails, it will be there for these reasons and I think they have to reexamine their hatred for the banks and for the bailouts they got.
Todd Schoenberger: What a bunch of hypocrites. This crew is not going to a credit union, or a community bank, but to a bulge bracket firm; a for-profit entity; the same group they keep protesting against and vandalizing. Yet, they're putting their money there because they know it's safe and they know they'll have access to it. Those are two critical parts that Occupy people really need right now.
Susan Ochs: What this really proves is what we already know about the big banks, which is that they are convenient. Occupy protesters have said that they put the money there, but they filed papers to open an account at a credit union. What I would love to see is if they sat down with Wells Fargo and they and Wells Fargo found out a way to keep their money in the bank. That would be a true reform.
Gary B. Smith: Starbucks up 50 percent in 18 months
Tobin Smith: Russell 2000 20 percent gain by January 1
Jonas Max Ferris: Internet Index up 20 percent by December 25
Todd Schoenberger: McDonalds has 20 percent profit by February