Tidbits Quotations
To Accompany November 12, 2014 edition of Tidbits
Bob Jensen at Trinity University

My Free Speech Political Quotations and Commentaries Directory and Log ---

Ivy League Liberalism at It's Finest
Emily Sellers (Dartmouth junior) asked if Perry would have anal sex in exchange for campaign contributions of $102 million, while Timothy Messen ’18 accused the governor of comparing homosexuality to alcoholism. Ben Packer (sophomore) who wrote and distributed these and other questions, said Perry’s views were more insulting than the questions.
Questions asked by students when Texas Governor Rick Perry was an invited campus speaker in 2014 ---

Happiness is like a butterfly: the more you chase it, the more it will elude you, but if you turn your attention to other things, it will come and sit softly on your shoulder.
Henry David Thoreau

It makes me wonder how all those people on Medicaid, food stamps, and welfare can afford iPhone and car payment monthly fees in hundreds of dollars. I suspect the main reason is avoiding marriage to what would otherwise become a higher income spouse.
Bob Jensen

According to the National Retail Federation, Americans are projected to spend $7.4 billion on Halloween this year, including $350 million on costumes for pets.
Kristin van Ogrop, Time Magazine, October 27, Page 58
Michele Obama should be rightly outraged at the unhealthy sugar intake of millions of children, and for what?

94% of Illegals Skip Their Deportation Hearings
Breitbart --- http://www.breitbart.com/Big-Government/2014/10/31/2-1-2-Month-Snapshot-Thousands-of-Family-Units-Failed-to-Appear-in-Immigration-Court

Be brave enough to start a conversation that matters.
Margaret Wheatley,

We must be willing to get rid of the life we've planned, so as to have the life that is waiting for us.
Joseph Campbell

If everyone is thinking alike, then somebody isn't thinking.
George S. Patton

It's better to walk alone than in a crowd going in the wrong direction.
Diane Grant

Republican Women are Traiters
Jessica Valenti --- http://www.theguardian.com/commentisfree/2014/nov/06/2014-election-republican-women-record-numbers
Read that as meaning there is only one major issue of importance dividing the two USA political parities. Women should ignore everything other than women's rights.

The measure of who we are is what we do with what we have.--
Coach Vince Lombardi

For the first time ever, there are 100 women in Congress
Sarah Kliff --- http://www.vox.com/2014/11/5/7160477/women-in-congress-first-time-100-legislators-midterms

Following President Barack Obama’s post-election press conference on Wednesday, MSNBC “Hardball” anchor Chris Matthews ranted against Obama for not deviating from his standard modus operandi of always defaulting to his constituency on key issues in search of “common ground” and not looking beyond that for “compromise” or making deals to create that common ground.

The Celebrated Nate Silver's Polls Were Off; Really, Really Off ---

The Polls Were Skewed Toward Democrats
Nate Silver --- http://fivethirtyeight.com/features/the-polls-were-skewed-toward-democrats/


 Polarized We Govern?
http://www.brookings.edu/~/media/research/files/papers/2014/05/27 polarized we govern binder/brookingscepm_polarized_figreplacedtextrevtablerev.pdf

"The US (including the GOP) Is Moving Left Despite Republican Gains," by William Saletan, Slate via Business Insider, November 8, 2014 ---

 Jensen Comment
I tend to agree in a sense that both major political parties in the USA have adopted what they think is Keynesian Economics in the sense that deficit spending is no longer something to be curtailed even if we simply print money to get away with it. But this is a perversion of Keynesian economics. JM Keynes advocated deficit spending in hard times and surplus build up in good times such as when unemployment falls below 6%.

Surpluses are a thing of the past.
There really are no Keynesians in power.

John Maynard Keynes --- http://en.wikipedia.org/wiki/John_Maynard_Keynes

Rape Crisis for Children and Adult Women in Sweden Goes Unheeded by the EU and the Swedish Government

"In Torrent of Rapes in Britain, an Uncomfortable Focus on Race and Ethnicity," by Katrin Bennhol, The New York Times, November 1, 2014 ---

In Norway the media is overstating the problem of rape ethnicity ---

This Damning Book Offers Little Hope For The Future Of Afghanistan ---

 Putin Is Reverting To The Cold War Era, And It's Incredibly Troubling ---

GORBACHEV: 'The World Is On The Brink Of A New Cold War' ---

Putin's War Games Are Setting Off Alarms Worldwide ---

American Airlines flight attendants rejected a five-year contract-by 16 votes-and
will likely earn less as a result ---

Chicago Boys --- http://en.wikipedia.org/wiki/Chicago_Boys

The (Former) Miracle of Chile --- http://en.wikipedia.org/wiki/Miracle_of_Chile

The “Miracle of Chile” was a term used by Nobel laureate economist Milton Friedman to describe the reorientation of the Chilean economy in the 1980s and the benefits of the economic policies applied by a large group of Chilean economists who collectively came to be known as the Chicago Boys, having studied at the University of Chicago where Friedman taught. He said the “Chilean economy did very well, but more important, in the end the central government, the military junta, was replaced by a democratic society. So the really important thing about the Chilean business is that free markets did work their way in bringing about a free society.”[1] The junta to which Friedman refers was a military government that came to power in a 1973 coup d'état, which came to an end in 1990 after a democratic 1988 plebiscite removed Augusto Pinochet from the presidency.

In the early 1970s, Chile experienced chronic inflation, reaching highs of 140 percent per annum, under socialist President Salvador Allende, whose government implemented high protectionist barriers, resulting in a lack of foreign-exchange reserves and falling GDP.[2] The economic reforms implemented by the Chicago Boys had three main objectives: economic liberalization, privatization of state-owned companies, and stabilization of inflation. The first reforms were implemented in three rounds – 1974–83, 1985, and 1990.[2] The reforms were continued and strengthened after 1990 by the post-Pinochet center government of Patricio Aylwin's Christian Democrats.[3] However, the center-left government of Eduardo Frei Ruiz-Tagle also made a commitment to poverty reduction. In 1988, 48% of Chileans lived below the poverty line. By 2000 this had been reduced to 20%. The 1990s center-left governments implemented a 17% increase in the minimum wage, a 210% increase in social spending targeted at the low-income sectors of the population, and across the board tax increases, reversing the Pinochet tax cuts of 1988 and taxing an additional 3% of the country's GDP into government coffers. Overall, economic growth stemming from the Chicago Boys' reforms accounted for 60% of the poverty reduction, whereas government programs aimed at poverty alleviation accounted for the rest.

Continued in article

Investment and growth are falling, and now the government targets private schools.
"The Chile ‘Miracle’ Goes in Reverse," by Mary Anastasia O’Grady, The Wall Street Journal, November 2, 2014 ---

It’s nonsense to suggest that a free society can guarantee equal opportunity or equal economic outcomes. But that doesn’t stop elected politicians in modern democracies from promising both.

That’s why an A for honesty is in order for Chile’s education minister, Nicolás Eyzaguirre, who admitted in June that Socialist President Michelle Bachelet ’s campaign pledge to rid Chilean education of “inequality” requires withdrawing the freedom parents now have to choose their child’s school.

“What we have now is one competitor . . . with skates going at a high speed and the other barefoot,” he said. “The barefoot one is public education. I have been asked why not provide better training and more food to the one going barefoot? First, I have to take away the skates of the other.” (Emphasis added)

Welcome to Ms. Bachelet’s Chile, where freedom is a problem because it upends the Socialists’ brave new world of equality. Learning more now, or earning more later, are symptoms of unfairness in the eyes of la presidenta and her party militants.

To understand why the outlook for the Chilean “miracle” is so grim and investment is plummeting, look no further than this government’s obsession with holding back those who would skate ahead of the pack.

Ms. Bachelet has increased tax rates on everything from capital to consumption. One objective is to soak the investor class, making it poorer so that income inequality goes down. But it is more likely that income disparities will go up since the rich have ways to shelter income while the poor depend on job creation from investment to earn their daily bread and build wealth.

When policies are capital-friendly, as they have been in Chile since the 1980s, life on the lower economic rungs improves in absolute terms. Writing in the Chilean daily El Mercurio on Oct. 19, former finance minister Hernán Büchi noted that Chile tripled its real income in three decades “and as a consequence generated an enormous social transformation especially for the poorest.” A 2013 World Bank study showed that between 1992 and 2009 Chile was “the country with the greatest social mobility on the continent,” Mr. Büchi wrote.

Last month the International Monetary Fund reported that on a purchasing-power basis Chile’s annual GDP per capita is now equivalent to $23,165, putting it just behind Poland ($24,429) and well ahead of Mexico ($17,925).

This impressive performance is unlikely to continue now that Chile is becoming another high-tax jurisdiction. According to the most recent figures available from Chile’s central bank, investment dropped 12.3% in the last quarter of 2013, 5.5% in the first quarter of this year and 8.1% in the second quarter. Last year around this time, the forecast for 2014 GDP growth was 4.5%. Now it hovers around 2%, thanks to falling commodity prices and the rising uncertainty produced by Ms. Bachelet’s hostility toward competition and profits.

The higher tax rates are supposed to generate higher revenue which the government says will be spent to improve public schools. Yet in the unlikely event that tax revenues increase while investors are running for the exits, there is no correlation between spending increases in union-controlled classrooms and academic results. The intellectual authors of the plan seem to recognize this, and it’s why they want to destroy private-school competition.

Chile’s popular voucher program began in 1981. Today it allows students to get an education at nonunionized private schools with a combination of government resources and parental assistance. It also permits selective admissions. The program has been enormously successful, and according to the Santiago-based Institute for Liberty and Development (ILD) nearly 1.9 million children (54% of the K-12 population) now attend private schools using government vouchers. Of those, some 1.1 million (31% of all school children) attend “for-profit” schools using a voucher.

The new law, which passed the lower house last month and now goes to the senate, would prohibit students from using vouchers to attend for-profit schools and prohibit schools that receive public subsidies from charging parents a co-payment. What is more, schools will no longer be allowed to select students because, apparently, it is “unfair” for gifted children to learn at their own speed.

This is cruel. It won’t affect Chile’s wealthy families, but many lower-income children will lose out. According to ILD, enrollment at the public schools dropped by 545,000 students from 2004-13 while subsidized private schools have increased by 364,000 students. The fact that many parents make the sacrifice to make co-payments demonstrates how badly they want to avoid public schools.

Ms. Bachelet has the teachers unions on her side but is rapidly losing support from the public. Chileans are catching on that “fairness” is just a cover for special-interest politics. A government that wanted to truly help the disenfranchised would work to expand choice rather than deny children the right to skate as fast as they can.


From the Tax Foundation
"2015 Business Tax Climate: Chilliest in Blue States," by Paul Caron, TaxProf Blog, October 29, 2014 ---

The Tax Foundation yesterday released the 2015 State Business Tax Climate Index, which ranks the fifty states according to five indices: corporate tax, individual income tax, sales tax, unemployment insurance tax, and property tax. Here are the ten states with the best and worst business tax climates:






South Dakota














Rhode Island






New Hampshire










New York




New Jersey

Continued in article

Jensen Comment
There are two kinds of tax "climates" in terms of individuals versus businesses. These two climates are highly correlated but there are some instances where a state having a high taxation business climate will give tremendous subsidies and/or tax deferrals to attract businesses and then clobber the individuals who move into the state. New York, for example, has tremendous deals exempting business income and sales taxes for new businesses locating near universities. But the deals do not extend to workers in those businesses.

Washington State did not make the Top 10 in terms of business climate taxation whereas Washington State has no income tax on individuals.

Taxachusetts taxes individuals in every which way and yet comes in at the middle at Rank 24 in terms of business taxes. This may be the reason some wealthy people who work at places like Harvard University commute from New Hampshire. They have to pay a Massachusetts tax on their in-state salaries but they can shield their portfolio capital gains taxes and royalty incomes by living in New Hampshire. Harvard's accounting professor Bob Anthony shielded his huge book revenues from state taxation by commuting in this way for years.

We keep hearing horror stories about Illinois business taxes relative to surrounding states of Indiana and Wisconsin. And yet Illinois did not make the Bottom 10 in the table above. Illinois is instead ranked near the middle at Rank 31. Go figure!


"Here Comes the 2014 Voter Fraud Progressives and the Justice Department are doing all they can to stop improvements in election integrity," by Hans von Spakovsky, The Wall Street Journal, October 27, 2014 ---

In the past few months, a former police chief in Pennsylvania pleaded guilty to voter fraud in a town-council election. That fraud had flipped the outcome of a primary election. Former Connecticut legislator Christina Ayala has been indicted on 19 charges of voter fraud, including voting in districts where she didn’t reside. (She hasn’t entered a plea.) A Mississippi grand jury indicted seven individuals for voter fraud in the 2013 Hattiesburg mayoral contest, which featured voting by ineligible felons and impersonation fraud. A woman in Polk County, Tenn., was indicted on a charge of vote-buying—a practice that the local district attorney said had too long “been accepted as part of life” there.

Now come the midterm elections on Nov. 4. What is the likelihood that your vote won’t count? That your vote will, in effect, be canceled or stolen as a consequence of mistakes by election officials or fraudulent votes cast by campaign workers or ineligible voters like felons and noncitizens?

Unfortunately, we can’t know. But one thing is almost certain: Voter fraud will occur. Many states run a rickety election process, lacking rules to deter people who are looking to take advantage of the system’s porous security. And too many groups and individuals—including the NAACP, the American Civil Liberties Union and U.S. Attorney General Eric Holder —are doing everything they can to prevent states from improving the integrity of the election process.

Their refrain is that voter fraud either doesn’t exist or is so insignificant that nothing needs to be done to improve ballot security. Yet in the U.S. Supreme Court’s 2008 ruling that upheld Indiana’s voter ID law, Justice John Paul Stevens acknowledged “flagrant examples of such fraud” throughout the nation’s history and observed that “not only is the risk of voter fraud real” but also that “it could affect the outcome of a close election.”

Polling shows that the November general election will likely have many close races, particularly on the local level. Nothing new there. In 2014, 16 local races in Ohio were decided by one vote or through breaking a tie. In 2013, 35 local races in Ohio were that close.

Voting by noncitizens alone could swing such races. A new study by two Old Dominion University professors, based on survey data from the Cooperative Congressional Election Study, found that 6.4% of all noncitizens voted illegally in the 2008 presidential election, and 2.2% voted in the 2010 midterms.

Since 80% of noncitizens vote Democratic, according to the survey, the authors concluded that these illegal votes were “large enough to plausibly account for Democratic victories in a few close elections.” Those that might have been skewed by noncitizen votes included Al Franken ’s 312-vote win in the Minnesota race for the U.S. Senate. As a senator, Mr. Franken would cast the 60th vote needed to make ObamaCare law.

We’ll never know what role noncitizen voting has played in past elections, but the problem is real. While states like New York ignore this problem, other states have passed rules to deal with it.

In addition to voter ID laws, Kansas and Arizona have put in place new proof-of-citizenship requirements for registration to prevent illegal voting. It is a common-sense and needed reform. In recent weeks North Carolina found more than 100 illegal aliens, still in the country thanks to the Obama administration’s Deferred Action for Childhood Arrivals program, registered to vote. Yet opponents including the League of Women Voters and Common Cause are challenging citizenship requirements in the courts.

Some states have also tried to eliminate same-day registration, which is a recipe for fraud since it prevents election officials from verifying the eligibility of voters and the accuracy of voter-registration information. States also are reducing early voting days, a relatively new phenomenon that has its share of election-administration problems.

These moves to shore up election integrity have been resisted by progressives at every turn, claiming without evidence that such efforts suppress minority turnout. While the lawsuits have largely failed to overturn the rules, they have succeeded in delaying their implementation and made it costly for states to improve election security. South Carolina’s voter ID law will be in place in the November election, but it cost the state $3.5 million in 2012 to beat Eric Holder’s Justice Department in court. The U.S. Supreme Court just upheld a decision throwing out an injunction against a Texas voter ID law, which was in place in state elections in 2013 and primary elections this year.

North Carolina, Ohio and Wisconsin are still battling progressives and the Justice Department in court over their election rules, although North Carolina and Ohio also got favorable decisions from the Supreme Court, allowing them to implement their rules for this election cycle. As John Fund and I outline in our new book on Attorney General Holder, the Justice Department refuses to enforce the federal law requiring states to keep accurate voter rolls—even though a 2012 Pew study found that the rolls are riddled with errors and ineligible voters.

How far are some liberals willing to go in undermining ballot integrity? This month, the conservative guerrilla filmmaker James O’Keefe caught a director of the “social change” organization Work for Progress and an employee for the Greenpeace environmental group voicing their approval of absentee-ballot theft and fraudulent voting in Colorado. Recent polls indicate that the state’s governor and U.S. Senate races are statistical ties.

Continued in article

"Dissenting From an SEC Windfall For Lawyers:  A $600 million ‘fair fund’ is likely to benefit only class-action attorneys and the fund’s administrators," by SEC Commissioners Daniel M. Gallagher And Michael S. Piwowar, The Wall Street Journal, November 10, 2014 ---

Earlier this month reports circulated that the Securities and Exchange Commission may set up a $600 million “fair fund” to distribute money collected from defendants to purportedly harmed investors in the insider-trading case SEC v. CR Intrinsic Investors.

In 2012 the SEC charged the Connecticut-based hedge-fund advisory firm CR Intrinsic Investors and former portfolio manager Matthew Martoma in connection with a $276 million insider-trading scheme involving the development of an Alzheimer’s drug by two pharmaceutical companies. The SEC’s complaint alleged that Martoma illegally obtained confidential details about negative results of a clinical trial and that, based on this information, several hedge funds sold more than $960 million in securities, avoiding hundreds of millions of dollars in losses.

In June the federal district court in the Southern District of New York approved a settlement between the SEC and CR Intrinsic. The court then ordered interested parties—including allegedly harmed investors—to make submissions to the SEC as to whether a fair fund should be established to distribute the money collected in the settlement. The court also directed the SEC to make a recommendation on setting up a fair fund.

We strongly object to the SEC’s reported recommendation to set up a fair fund, for a number of reasons. Fair funds can play an important role in returning money to defrauded investors, but in this case it will be incredibly difficult and expensive to identify and compensate the victims. In fact, it may not be possible to know who was harmed.

The only guaranteed winners will be administrators who distribute the fair fund and class-action lawyers who will take a significant cut of any funds paid to their clients. Indeed, plaintiffs lawyers mounted an unprecedented lobbying campaign after the court directed the SEC to make a recommendation about whether to establish a fair fund. Before the vote, our offices received dozens of letters from purported victims urging the commission to petition for a fair fund.

The strikingly similar tone and content of the letters that came cascading into our offices made it clear that they had been sent at the behest of class-action lawyers in a parallel civil action. It was all part of a coordinated campaign by the plaintiffs bar to gain access to the pot of gold at the end of the government investigations rainbow. These lawyers played no part in the commission’s successful enforcement action, yet they may now receive tens of millions of dollars as a result of the majority’s vote.

We refuse to be a part of any commission decision that will create a cottage industry for class-action lawyers, piggybacking on government investigations and targeting the disgorgement—and, even worse, government-ordered penalties—collected from defendants in SEC enforcement actions.

This decision sets a dangerous precedent. Class-action lawyers now have an incentive to round up potential victims in SEC insider trading cases and arrange a substantial contingency fee, then lead a fair-fund campaign under the guise of a grass-roots movement by harmed investors. Class-action lawyers could reap a third of the fair fund payouts thanks to the efforts of hard-working SEC staffers and the taxpayers who pay them.

The most galling aspect of the majority’s decision to seek a fair fund is that it will, in the long run, harm the investors the SEC is supposed to protect. Rather than receiving the maximum possible compensation for their losses under a fair fund, harmed investors are now at greater risk of suffering the additional loss of a significant amount of their potential recovery at the hands of opportunistic trial attorneys. The creation of a fair fund in this case is simply a misguided, massive wealth transfer to plaintiffs lawyers.

Beyond the corrupting influence this fair fund will have on internal SEC processes and the risk of further harm to victims, the majority’s action ignores questions of whether identifying harmed investors and calculating the amount of damages is practical, or even possible. The minuscule chance that some harmed investors might be identified cannot justify the resources that would be expended on a fruitless search.

The majority’s decision is all the more worrisome because it signals that the SEC may seek a fair fund in every insider trading case hereafter. Such a road would lead to pure folly—or in the case of class-action plaintiffs lawyers, to the bank.

Messrs. Gallagher and Piwowar are commissioners at the Securities and Exchange Commission.


From the CFO Journal's Morning Ledger on October 28, 2014

Rising U.S. life spans spell likely pain for pension funds ---

Longer lives for retirees may add to a squeeze at many pension funds that are already struggling to plug a gap between available assets and future obligations to retirees. New estimates on life spans for both men and women could eventually increase retirement liabilities by roughly 7% for most corporate plans.

Jensen Comment
The impact on Social Security, Medicare, and Medicaid programs will be even more devastating, especially Medicare and Medicaid programs that are not presently sustainable without drastic changes in funding and benefits.

The pending entitlements disaster ---



Title: “Wealth Inequality in the United States since 1913: Evidence from Capitalized Income Tax Data”
Authors: Emmanuel Saez, Gabriel Zucman
Reviewed by By Ben Casselman
October 28, 2014
Nate Silver's 5:38 Blog

. . .

Key quote:
“Income inequality has a snowballing effect on the wealth distribution: top incomes are being saved at high rates, pushing wealth concentration up; in turn, rising wealth inequality leads to rising capital income concentration, which contributes to further increasing top income and wealth shares. Our core finding is that this snowballing effect has been sufficiently powerful to dramatically affect the shape of the U.S. wealth distribution over the last 30 years.”

Continued in Article


Are there conflicts of interests here beyond the usual motivation to work for a government agency in order to get a future high paying job in the industry being regulated.?

"Tax Revolving Door Enriches Former IRS Officials Who Cash in by Navigating Inversions Through Rules They Wrote," by Paul Caron, TaxProf Blog, October 28, 2014 ---

Hal Hicks cleared his throat and addressed a roomful of peers in a midtown Manhattan auditorium. The topic: the tax-avoidance technique called inversion, in which a U.S. company claims a foreign legal address.

Waving his hands back and forth as if tracing a pendulum’s swing, Hicks explained how four government attacks over three decades had failed to stop the practice. “There’s been lots of law thrown at these transactions,” he said at the January session.

Hicks ought to know. He was the one doing the throwing, during four years as a top government tax lawyer. Then, he returned to private practice and helped set in motion a spree of inversions that a congressional panel estimates will cost at least $19.5 billion in lost tax revenue over the next decade.

Hicks epitomizes the world of high-level Washington lawyers who have played a behind-the-scenes role in helping these tax-driven address changes proliferate. Top federal tax officials, many of them career corporate lawyers, have sometimes closed loopholes only after companies slipped through them. And former officials like Hicks use skills and contacts honed in office to help companies legally outmaneuver the government.

Until this year, when address-shifting by more than a dozen companies worth $100 billion caught policy makers’ attention and President Barack Obama clamped down again, inversion rules had for a decade attracted little notice outside the small community of international tax lawyers in Washington.

At the Treasury Department and Internal Revenue Service, officials, many on hiatus from private practice, crafted the rules in dialogue with top corporate law and accounting firms.

While some European nations have historically relied on career civil servants, the top ranks of the U.S. tax administration have swapped staff with industry for decades.

It’s a low-cost way to provide government with the best legal talent, said Gregory Jenner, a former acting assistant Treasury secretary, who calls it an “incredibly beneficial tradition.”

“Putting rookies into these jobs -- they would be overwhelmed,” Jenner said. “It’s too high-level, too sophisticated, too complicated.”

The risk, critics say, is that some government lawyers may continue to sympathize with corporate interests, or be swayed by former colleagues. ...

In a statement, the Treasury said that hiring from the private sector helps “keep us at the forefront of emerging issues.” ...

No U.S. law firm has helped more companies escape the tax system through inversions in the past decade than Skadden Arps Slate Meagher & Flom LLP. Hicks, 55, who runs its international tax group, has pulled off three inversions himself, including one involving an innovative maneuver nicknamed a “skinny down distribution.” ...

Former top government officials often end up at Skadden. Hicks’s new partners there included a former IRS commissioner and two former assistant Treasury secretaries, not to mention B. John Williams, who had been the top IRS lawyer when Hicks joined the agency, and who later represented an inverted company, Ingersoll-Rand Plc, in a $774 million tax dispute with the IRS. Through a spokeswoman, Skadden declined to comment.

That year, the Tax Review called Skadden “the law firm of choice for departing government officials,” citing Hicks’s hiring.

Continued in article


"The Newest Employees at Lowe’s Hardware Store: Robots," by Mae Anderson, Yahoo Tech, October 28, 2014 ---

No More Jobs on the Farms or Most Anywhere Else
"Get Ready for Robot Farmers,"  by Jodi Helmer, CNNMoney via Yahoo Tech, October 24, 2014 ---

"Patented Book Writing System Creates, Sells Hundreds Of Thousands Of Books On Amazon," by David J. Hull, Security Hub, December 13, 2012 ---

Philip M. Parker, Professor of Marketing at INSEAD Business School, has had a side project for over 10 years. He’s created a computer system that can write books about specific subjects in about 20 minutes. The patented algorithm has so far generated hundreds of thousands of books. In fact, Amazon lists over 100,000 books attributed to Parker, and over 700,000 works listed for his company, ICON Group International, Inc. This doesn’t include the private works, such as internal reports, created for companies or licensing of the system itself through a separate entity called EdgeMaven Media.

Parker is not so much an author as a compiler, but the end result is the same: boatloads of written works.

"Raytheon's Missiles Are Now Made by Robots," by Ashlee Vance, Bloomberg Business Week, December 11, 2012 ---

A World Without Work," by Dana Rousmaniere, Harvard Business Review Blog, January 27, 2013 --- Click Here

Jensen Comment
There's hope until robots are reading, comprehending, and writing reviews of books written by robots. 

Jensen Question
How many years will it take for cost accountants to stop teaching how to allocate overhead on the basis of direct labor hours or costs?


"Let Islamic Reform Start in America We must stop looking to the Middle East, where regressive religion and authoritarianism reign," by Salam Al-Marayati and Maher Hathout, The Wall Street Journal, October 30, 2014 ---

"Muslim communities in the West,” wrote Graham Fuller and Ian Lesser in 1995 (“The Geopolitics of Islam and the West”), “are more likely to exert influence on their countries and cultures of origin rather than receive influences from them; over time they may have a substantive effect on the perceptions of secularization and minority rights in the Middle East.”

This shift—from the American Muslim community being perceived as foreign and an extension of the Middle East and South Asia to American Muslims instead influencing the East—is the direction in which Muslims are heading. Rampant authoritarianism in the Muslim world and the regression of Muslim religious establishments funded by the same autocratic governments currently make Islamic reform unlikely in the region.

American Muslims can significantly contribute to the revival of Islam and restore human dignity as a central principle of the faith. From despotic regimes to religious extremism, authoritarianism in the Middle East and South Asia has devastated modern Islamic thought over the last few centuries. American Muslims have the freedom and the intellectual capacity to create positive change for Islamic reform.

There are 1.5 billion Muslims in the world, and their religion needs to be relevant for all of their lives. All religions and man-made philosophies go through reform and renewal. We Muslims must liberate ourselves from the shackles of dogmatic traditions such as sectarianism, tribalism, chauvinism and theocracy, all of which contradict Islamic ethics based in the Quran and the authenticated traditions of the Prophet Mohammed.

The areas that need immediate attention for Islamic reform are: promoting good governance; protecting the rights of religious minorities and women; and marginalizing the ideology of compulsion. There was more discourse on the penal code and jurisprudence centuries ago, at the peak of Islamic civilization, when leaders focused on the spirit of the Islamic law, rather than on the absolute letter of the law.

For example, within two decades after the Quranic revelation was complete in 632, the punishment for theft was suspended by Omar ibn al Khattab, the second successor to the Prophet, when the economy deteriorated and poverty was endemic. In this case, along with many others, a leader suspended a conditional Quranic instruction because of new circumstances. That thinking is needed now more than ever.

As is well known, the human rights of women and religious minorities are violated in many Muslim countries. Communities that don’t align with the ideology of the ruling power live in inhumane and oppressive conditions. In 2002 religious police in Saudi Arabia prevented girls from escaping a burning school in Mecca and 15 female students died. These men, members of the Committee for the Promotion of Virtue and the Prevention of Vice, would not allow the girls to escape the building because their head scarves were not completely covering their hair.

This meant a rule trumped the protection of life, one of the five goals of Islamic law, the others being freedom of expression, freedom of religion, rights of family, and rights of property. The five goals are called the Maqaasid of Islamic law and are unanimously accepted by Islamic jurists. The Maqaasid needs to be given new life, and that can only happen in an environment of freedom and futuristic thinking. There is no Islamic ethics or morality achieved by religious police.

This Saudi religious police force, similar to those in Iran and throughout South Asia, is a bastardization of a very important Islamic concept—Maslaha, or public interest. The verse in the Quran related to Maslaha refers to the promotion of social benefit, defined by the Maqaasid and known by the people as human decency, and the prevention of public harm. Religious policing is rooted in the ideology of compulsion. It is a distortion of that valuable understanding of public interest in any nation’s jurisprudence or executive authority.

American Muslims have looked to the Middle East for religious authority, for spiritual direction and, at times, for political priorities. We must end this practice by declaring that any country or group claiming to be Islamic must uphold the most important principle in Islam, protecting life rather than destroying it.

Any country that kills its own people, persecutes religious minorities and subjugates women is anathema to American Muslims. They can call themselves angels, but they cannot camouflage their evil under a religious veneer. Islam liberated us from the shackles of religious tyranny, and we will struggle to liberate ourselves by declaring our independence from the tyrants and clerics who have usurped authority and religion in claiming sovereignty over Muslims world-wide.

Mr. Al-Marayati is president and Dr. Hathout is senior adviser of the Muslim Public Affairs Council.

Under legislation signed by spendthrift President GW Bush who rarely vetoed any spending bills causing huge budget deficits
"Are We Forgiving Too Much Student-Loan Debt?" by Max Lewontin, Chronicle of Higher Education, November 7, 2014 ---

Back in 2007, Congress made a simple promise to student-loan borrowers: Stick with a public-service career for 10 years, making monthly payments along the way, and we’ll forgive the rest of your debt.

Now, as the bill gets closer to coming due, a growing chorus of analysts and observers is asking: Was that the right promise to make?

At issue is a program known as Public Service Loan Forgiveness. The program, included in the College Cost Reduction and Access Act of 2007, is an attempt to fight two problems at once: ballooning student-loan debt and a scarcity of graduates serving the public good.

At least, that’s the thinking. And it’s been the thinking behind loan forgiveness for quite a while. Since 1958, when Congress created the first such program—to forgive the loan debts of teachers—lawmakers have offered loan forgiveness to people working in a wide variety of fields, including military-service members, doctors working on American Indian reservations, even large-animal veterinarians and U.S. Capitol police officers.

All told, there are about 30 other loan-forgiveness programs now on the books. Millions of dollars in debt are scrubbed each year, some by the federal government, some by states.

Tearful Testimony

The large number of participants in some programs—particularly for teachers and health professionals—may indicate that loan forgiveness encourages people to pursue those low-paying but valuable careers. An administrator of one such plan describes some participants as growing tearful when they speak of the impact loan forgiveness has had on their careers.

"I wish I could bring Congress to this and let them see that this is one program that they put in place that really is doing what they want," says the administrator, who declines to be named because she is not authorized to speak for her agency.

But while advocates see the new plan as an extension of that goal, others see a program with several loopholes—one that could allow borrowers to forgo dangerously large amounts of debt while leaving taxpayers to pick up the tab.

What’s different this time around? Much of the controversy comes down to two key features of the program, which will begin forgiving loans in 2017. First, unlike its predecessors, it puts no cap on how much money can be forgiven. Second, its broader eligibility requirements could make forgiveness available to more people, in more jobs, than ever before.

Those features mean the plan could have a wide impact on legions of borrowers struggling with the burdens of student-loan debt. But they also raise questions about whether the program can be exploited.

With the first wave of payouts bearing down, lawmakers, think tanks, and even President Obama have recommended significant modifications. Their suggestions have stoked a broader question: What, exactly, is loan forgiveness meant to achieve?

To Cap or Not to Cap?

Much of the concern about Public Service Loan Forgiveness stems from a single source: the New America Foundation, a nonprofit public-policy institute that has been raising alarms about the program since 2012.

And on New America’s list of fears, the lack of a cap looms large. Nearly all other existing programs restrict the amount that can be forgiven—often holding it to around $40,000 to $60,000 total, sometimes less.

If the government doesn’t cap how much debt can be wiped clean, the group argues, the new program could simply encourage borrowers to take on unmanageable debt levels.

Overborrowing is a problem for everyone, not just the borrower, says Jason Delisle, a policy analyst at New America, because it could drive the cost of college further upward. "Public Service Loan Forgiveness tells the colleges, Yes, you can charge 60 grand, and tells the student, Yeah, you can borrow 60 grand."

New America’s predictions have had a far-reaching impact. In March, President Obama, traditionally a proponent of expanding federal programs that would reduce student debt, took a step back. His 2015 budget proposal includes a plan to limit the amount of individual debt forgiven under the public-service program to $57,500, which is the current limit that financially independent undergraduates can take out in federal loans.

Some student-loan administrators share the president’s concern.

"There’s a moral hazard for the student—whether it’s degree-hopping or whether it’s going too far into debt for any single program," says Justin Draeger, president of the National Association of Student Financial Aid Administrators.

In a recent report, the group also recommended limiting forgiveness to the $57,500 level. But it suggested that borrowers also have half of any additional loan debt forgiven, up to a total of $138,500.

Mr. Obama’s proposed cap has yet to be reviewed by lawmakers. But it has already raised its own set of concerns—chief among them that adding a cap amounts to neutering the program.

"Do we need to have some safeguards to prevent overborrowing?" asks David A. Bergeron, vice president for postsecondary education at the Center for American Progress, a public-policy group. "Maybe—but we’re a little early in that process to make that determination."

Mr. Bergeron, a former Education Department official, points out that the cost of Public Service Loan Forgiveness is built into the government’s loan program. Essentially, he says, the profits from other borrowers who go into default or forbearance on their federal loans subsidize loan forgiveness.

It’s difficult to assess how the lack of a cap will affect the new program, especially because it requires a much longer public-service commitment than most others of its kind. But a closer look at earlier loan-forgiveness programs serves as a reminder that not everyone takes advantage of the full benefits.

For example, the Government Employee Student Loan Repayment Program allows employees of nearly any federal agency to have up to $10,000 forgiven each year, up to a maximum of $60,000. In 2012, $70.3-million in debt was forgiven for 10,543 employees who participated. That works out to an average of $6,670 per person, about two-thirds of the amount available.

Who Counts as a Public Servant?

The new loan-forgiveness program covers several jobs traditionally thought of as rooted in public service—teacher, public defender, social worker, nurse. But the program also offers forgiveness to anyone working at tax-exempt nonprofit organizations for 10 years. That could open up forgiveness to policy analysts or public-relations officials, for example.

Analysts at New America think that might be a loophole. Here’s how that would work, according to Mr. Delisle. A borrower’s monthly loan payments would be based on his or her income, not on the amount of debt he or she had incurred. If someone gets an expensive degree and then enters into a low-paying job, the gap between the debt paid and the debt forgiven after 10 years can grow wide.

In one example presented by New America, a nurse who owes $75,000 in debt would make regular payments amounting to $36,000 in total over 10 years. Factor in high interest rates, and that nurse could end up with $67,000 in forgiven loans.

The think tank argues that it’s a real problem when that kind of money is spent to subsidize career choices that don’t seem underrepresented or vital to the public.

Analysts at New America have frequently singled out Georgetown University’s law school, which informs its students about the loan-forgiveness plan as part of its routine financial-aid counseling, as an example. Too many law students—who have among the largest amounts of debt of any student group—could take advantage of the program, New America says, because the expansive list of eligible jobs now goes beyond traditional public-service roles like public defenders or county prosecutors.

Continued in article

Bob Jensen's threads on higher education controversies ---


Hollywood Follows the Tax Incentives
From the CFO Journal's Morning Ledger on November 3, 2014

Add Hollywood to the list of industries looking to take advantage of tax breaks offered in far-flung locales, the WSJ’s Erich Schwartzel reports. But there are risks—mostly in the form of fickle legislators and the court of public option.

Some companies recently saw their plans to engage in inversion deals to get better tax treatment abroad unwind after the U.S. Treasury Department announced new rules to stem the tide of such transactions. And now a movie production-facility company with soundstages around the world is also finding that foreign tax breaks can be taken away just as easily as they can be granted.

Pinewood Shepperton PLC is building movie production facilities in six countries that offer generous tax breaks and incentives for producers. Recently it landed one of Hollywood’s most high-profile projects in Walt Disney Co.’s coming installment of the Star Wars franchise at its facility in England. But similar tax deals have been known to unwind under the skeptical glare of lawmakers. North Carolina, Kansas and Wisconsin have reduced or eliminated their tax incentives for filmmakers, and in Germany, where Pinewood has one of its operations, the amount allocated to the country’s film fund has shrunk on the whims of the current crop of legislators.

Jensen Comment
Actually, for some of the best tax deals Hollywood pulls Governor Brown's strings in California by demanding payback for political fund raising and political support.
Film producers demand taxpayer paybacks.

"California triples tax breaks for film production," by Sharon Bernstein, Reuters, September 18, 2014 ---

"How the Market Ruined Twitter:  Now it’s just a company trying to make money," by Justin Fox, Harvard Business Review Blog, October 31, 2014 --- Click Here

. . .

As Johnson had described it in much more depth in a Time cover story a few months before, what made Twitter so promising and interesting and important was “the fact that many of its core features and applications have been developed by people who are not on the Twitter payroll.” Most of its conventions (the hashtag, for example) had been developed by users. And “the vast majority of its users interact with the service via software created by third parties.” It was basically an open-source enterprise, and seemed to owe most of its remarkable success to that openness.

Of course, that “success” didn’t come with a lot of revenue. For its first four years, Twitter was able to keep the servers running thanks to mainly to $150 million in funding from venture capitalists and angel investors. Then, after a few of those investors ousted co-founder and CEO Ev Williams in a boardroom coup late in 2010, Twitter raised another $1.2 billion in less than a year. Not surprisingly, the company stopped glorying in the openness of its ecosystem not long after that. Spooked by investor/entrepreneur Bill Gross’s attempt to build a sort of shadow Twitter by buying up the most popular third-party apps, Twitter began cracking down on those third-party software purveyors and taking control of its relationship with users (in order to better “monetize” them). It’s still the users whose creating and sharing gives Twitter its value as a business, but their activities are now mostly channeled and managed by the company itself. And while Twitter has taken some limited steps lately to win back outside app developers, the bigger news has been its apparent intent to move away from its simple chronological timeline to use algorithmic methods to determine what users see, as rival Facebook has done for years.

Continued in article


Midterm Elections of 2014
"It Was A Terrible Night For Obamacare...," by Brett LoGiurato, Business Insider, November 5, 2014 ---

From the CFO Journal's Morning Ledger on November 6, 2014

Health insurers woo consumers in crowded market
Health insurers are unleashing a blizzard of ads, letters, live events and other efforts to reach consumers, as the industry ramps up for the reopening of the health law’s marketplaces on Nov. 15. Meanwhile, small-business owners test-driving the federal government’s new online health-insurance exchange report a mixed experience with the site ahead of its planned opening in 10 days.

Jensen Comment
Health insurance is currently a very good business for companies, because bad debts from people who do not pay contracted premiums are passed on to the doctors and hospitals after 30 days. In any case Obamacare promises guaranteed profits for insurance companies at taxpayer expense if necessary. This is not capitalism since one of the tenants of capitalism is that businesses take risks risks of losses and failure.

It's the doctors and hospitals that take the financial risks. In New Hampshire nearly half the hospitals refuse to admit patients with ACA insurance except in dire emergencies. Many doctors are turning patients away unless they have something other than ACA medical insurance.

Another good thing for insurers is that the deductibles have become so huge (40% to 60%) that insured people put off getting medical care until absolutely necessary --- thereby greatly reducing the number of claims to be processed and paid.

My point is that just to say that more people now have ACA health insurance is not saying a whole lot about the quality of health care that this insurance is buying. There will probably be gridlock for years in Washington DC for any attempts to bring quality health care to all citizens of the USA. I favor national health insurance, although national health insurance plans in most non-OPEC nations like Sweden, Denmark, and the UK are doing badly these days. I consider Canada to be an OPEC nation. Germany is doing better because it allows people to take on supplemental health insurance using their own savings.

The USA is now an one of the world's largest oil producers, but gridlock politics have all but destroyed possibilities for great health care for all citizens. It's one of the best nations for health care for people who can afford to pay for the services, including those lucky enough to be on Medicaid or Medicare.

Bob Jensen's references for the above summary are at

"Here's How the Government Is Wasting Your Tax Dollars," by Barton Hinkle, Reason Magazine, November 5, 2014 ---

You think the federal government wastes money? You don’t know the half of it. During the past year alone, Washington has shelled out billions to give bureaucrats paid vacations in lieu of discipline; to ship coal to Germany for no reason; to design better golf clubs; and to give bunny rabbits massages — among many other things.

According to received wisdom, Americans ought to be clear about three things: (1) You can’t balance the federal budget by targeting waste, fraud and abuse. (2) The spending cuts imposed by sequestration have been devastating. (3) We might have an Ebola vaccine by now if federal agencies had received adequate funding.

Each of these propositions contains some truth. No amount of pork-trimming can offset the huge outlays for entitlements, which (along with interest on the debt) will soon consume every dollar Washington collects. Sequestration’s cuts do indeed apply equally to crucial government outlays, such as military flight training, as well as foolish ones. And while there’s no guarantee more spending would have produced an Ebola vaccine by now, there’s no guarantee it wouldn’t, either.

But arguments like those offer cold comfort when you page through the latest issue of Sen. Tom Coburn’s Wastebook, which relates just some of the myriad ways the federal government squanders your hard-earned pay.

It begins by noting that many federal workers are placed on paid administrative leave for offenses that, in the private sector, would result in summary dismissal. Such as? Such as buying liquor with government charge cards, watching porn at work or not doing their jobs. At the Department of Homeland Security, 237 employees were put on paid leave for more than 10 days this past year — more than 200 of them for misconduct.

Last year DHS Secretary Janet Napolitano said the sequester would put “our nation at risk” by “significantly negatively affecting . . . operations.” (That’s bureaucrat-speak for harming them.) Yet this year, DHS was able to find enough change in the seat cushions to pay for night-vision goggles, a robot and chemical suits for Ithaca, N.Y. — which already boasts the distinction of being named one of America’s safest small towns by Farmers Insurance.

The House Armed Services Committee has warned that sequestration “put our military and national security at risk.” But Congress can be only so alarmed — given that it continues forcing the Air Force to heat military bases in Germany with anthracite coal mined in Pennsylvania. The Defense Department has pleaded to no avail “to end this earmark because it wasted hundreds of millions of dollars annually,” the Wastebook reports.

The litany of lunacy runs on and on, and includes expenditures such as. . .

A special word ought to be said about the National Science Foundation, which seems to have a fetish for funding ridiculous research projects, to the tune of . . .

Then there’s the National Center for Complementary and Alternative Medicine, an arm of the National Institutes of Health. In the past two years, it has spent $387,000 on a study testing the effects of Swedish massage on the muscle recovery of rabbits that had recently been exercised.

That should come in real handy in the fight against Ebola.

Jensen Comment
These remind me of the famous Golden Fleece Awards issued by Wisconsin's Senator Proxmire years ago ---


From the CFO Journal's Morning Ledger on November 6, 2014

Health insurers woo consumers in crowded market
Health insurers are unleashing a blizzard of ads, letters, live events and other efforts to reach consumers, as the industry ramps up for the reopening of the health law’s marketplaces on Nov. 15. Meanwhile, small-business owners test-driving the federal government’s new online health-insurance exchange report a mixed experience with the site ahead of its planned opening in 10 days.

Jensen Comment
Health insurance is currently a very good business for companies, because bad debts from people who do not pay contracted premiums are passed on to the doctors and hospitals after 30 days. In any case Obamacare promises guaranteed profits for insurance companies at taxpayer expense if necessary. This is not capitalism since one of the tenants of capitalism is that businesses take risks risks of losses and failure.

It's the doctors and hospitals that take the financial risks. In New Hampshire nearly half the hospitals refuse to admit patients with ACA insurance except in dire emergencies. Many doctors are turning patients away unless they have something other than ACA medical insurance.

Another good thing for insurers is that the deductibles have become so huge (40% to 60%) that insured people put off getting medical care until absolutely necessary --- thereby greatly reducing the number of claims to be processed and paid.

My point is that just to say that more people now have ACA health insurance is not saying a whole lot about the quality of health care that this insurance is buying. There will probably be gridlock for years in Washington DC for any attempts to bring quality health care to all citizens of the USA. I favor national health insurance, although national health insurance plans in most non-OPEC nations like Sweden, Denmark, and the UK are doing badly these days. I consider Canada to be an OPEC nation. Germany is doing better because it allows people to take on supplemental health insurance using their own savings.

The USA is now an one of the world's largest oil producers, but gridlock politics have all but destroyed possibilities for great health care for all citizens. It's one of the best nations for health care for people who can afford to pay for the services, including those lucky enough to be on Medicaid or Medicare.

Bob Jensen's references for the above summary are at


Jensen Question
Managerial accounting textbooks are stuffed with cases and problems on such things as "make versus buy" decisions.

It may be a bit early for textbooks to be updated for the ACA law, but have any cases emerged in courses on decisions to drop or keep employee health insurance coverage?


ACA Health Insurance Mandate for Employers in 2015 Causes New Obstacles and Challenges

From the CFO Journal's Morning Ledger on October 15, 2014

With the health law’s insurance mandate for employers set to kick in next year, companies are trying to avoid the law’s penalties while holding down costs, using strategies like enrolling employees in Medicaid, the WSJ reports. The law’s penalties, which can amount to about $2,000 per employee, take effect next year for firms that employ at least 100 people.

Insurance brokers and benefits administrators are pitching companies on strategies to keep a lid on expenses that exploit wrinkles in the law. The Medicaid option is drawing particular interest from companies with low-wage workers, brokers say.

Locals 8 Restaurant Group LLC, with about 1,000 workers, already offers health coverage, and next year plans to reduce some employees’ premiums so as to avoid running afoul of the law’s standard for affordability. It will also help eligible employees enroll in Medicaid, using a contractor called BeneStream Inc. Such maneuvers could fuel controversy as costs are shifted to taxpayers, but BeneStream said its business is growing rapidly.

From the CFO Journal's Morning Ledger on October 31, 2014

Small firms (under 50 employees) drop health plans ---
Small companies are starting to turn away from offering health plans, with many viewing the health law’s marketplace as an inviting and affordable option. Wellpoint Inc. said its small-business-plan membership is shrinking faster than expected and it has lost about 300,000 people since the start of the year, leaving a total of 1.56 million in small-group coverage. Other insurers have flagged a similar trend.

Modestly larger firms are moving more employees to part-time in order to drop coverage. Larger firms have a much more difficult time avoiding high penalties for dropping health plans.

From the CPA Newsletter on May 27, 2014

IRS sets high penalties for (large) companies that send employees to ACA health exchanges
According to an Internal Revenue Service ruling, employers that move employees to health insurance exchanges by reimbursing them for their premiums do not satisfy the requirements of the Affordable Care Act. Companies that send workers to the exchanges face a tax penalty of $100 a day, or $36,500 a year, per employee. The New York Times (tiered subscription model) (5/

Eventually, large employers may opt to pay the fine for not providing health insurance and leave their workers to get coverage in the exchanges. Doing so might even save them money.
"Obamacare Increases Large Employers' Health Costs," by Sally Pipes, Forbes, May 19, 2014 ---

Employer-provided health insurance may not be long for this world. According to a new report from S&P Capital IQ, 90 percent of American workers who receive health insurance from large companies will instead get coverage through Obamacare’s exchanges by 2020.

For that, patients — many of whom no doubt like the insurance they currently have — can blame Obamacare. The law’s many mandates, fees, and taxes will increase health costs for large employers to the point that providing health benefits at work is financially unsustainable.

Consider some of Obamacare’s most burdensome new levies. For instance, one fee on group plan sponsors is intended to fund the Patient Centered Outcomes Research Institute (PCORI), a government-sponsored organization charged with investigating the relative effectiveness of various medical treatments. Medicare may consider the Institute’s research in the determining what sorts of therapies it will cover.

Set aside the fact that the government — as paymaster for half of the health care delivered in this country — will have a significant incentive to twist the findings of such research so that older, cheaper therapies seem just as effective as more expensive, cutting-edge ones.

Making matters worse, the federal government is forcing private firms to underwrite its dirty work. For plan years ending after September 30, 2013, and before October 1, 2014, employer sponsors must pay the feds a PCORI fee of $2 per covered life. And for plan years between October 1, 2014, and October 1, 2019, they’ll have to pay an amount adjusted for national health inflation.

Large employers also have to pay a Temporary Reinsurance Fee to help “stabilize” premiums in the individual insurance market. In an American Health Policy Institute (AHPI) survey of businesses with more than 10,000 employees, one company estimated that this fee could cost it $15.3 million from 2014 to 2016.

Then there’s the 40 percent excise tax on expensive insurance plans — those with premiums greater than $10,200 for individuals and $27,500 for families — which goes into effect in 2018. One company in the same survey said that this tax could cost it $378 million over five years.

Large employers like these cover 59 percent of private-sector workers, according to the Employee Benefit Research Institute. So many firms will likely face the same tax-motivated cost increases as these two.

Obamacare doesn’t just tax employers directly. Its many coverage mandates also raise the cost of benefits indirectly.

Effective 2015, the law’s employer mandate requires employers with 100 or more full-time employees to provide health insurance to full-timers or pay a fine. In 2016, those with 50 to 99 employees will have to follow suit. The law originally intended for both groups to comply with the mandate in 2014.

Obamacare also orders plans to cover adult children on their parents’ policies until they’re 26 years of age. This “slacker mandate” has already raised employer health insurance costs by 1 to 3 percent. One firm told AHPI that the mandate could cost it almost $69 million over ten years.

Obamacare also requires employer-sponsored health plans to cover 100 percent of preventive care services, such as immunizations, contraceptive care, and depression screening. One large employer reported that full coverage of contraceptive care on its own could cost $25.6 million over ten years.

It’s no wonder that large employers expect their health bills to escalate in the years to come. The AHPI survey revealed that Obamacare could increase their health costs by 4.3 percent in 2016, 5.1 percent in 2018, and 8.4 percent in 2023.

Those percentages equate to real dollars. Over the next ten years, Obamacare could cost large employers $151 billion to $186 billion. That’s about $163 million to $200 million in additional cost per employer — or $4,800 to $5,900 per employee — solely attributable to the health reform law.

Employers will likely pass along these costs to their workers. According to a recent Mercer survey, 80 percent of employers are considering raising deductibles — or have already done so.

Eventually, large employers may opt to pay the fine for not providing health insurance and leave their workers to get coverage in the exchanges. Doing so might even save them money.

The care for an employee with hemophilia, for example, can cost a company $300,000. That could end up being a lot more expensive than the $2,000 per-employee fine for not offering insurance.

Firms could also continue furnishing insurance to most of their workers — but nudge their costliest ones onto the exchanges by making the company insurance plan unattractive to them. A company could shrink its network of doctors, raise co-payments, or even offer a chronically ill employee a raise to opt out of the employer plan.

In so doing, the company would save money. The employee would be able to secure better coverage through the exchange. And if a raise covered the cost of the exchange policy, both parties would benefit.

Others in the exchange pool — and the taxpayers subsidizing them — won’t be so lucky. Exchange enrollees are already sicker than their counterparts outside the government insurance portals. Indeed, the exchange pool fills prescriptions for the sorts of specialty drugs associated with chronic disease at a rate that’s 47 percent higher than for folks outside the exchanges.

Adding even more high-cost individuals to the exchanges could cause insurers to hike premiums. And higher premiums require greater taxpayer subsidies. Already, the Congressional Budget Office projects that the federal government will spend $1.03 trillion on exchange subsidies and related spending from 2015 to 2024.

If employers dump their sickest employees into the exchanges, that number could go spiral even further upward.

Continued in article

Bob Jensen's universal health care messaging --- http://www.trinity.edu/rjensen/Health.htm

Some 148,283 of those 350,000 fraudsters ineligible for Medicaid in Illinois have been removed from the rolls as of November 2014

"Audit reveals half of people enrolled in Illinois Medicaid program not eligible," by Craig Cheatham, KMOV Television, November 4, 2013 ---

The early findings of an ongoing review of the Illinois Medicaid program revealed that half the people enrolled weren’t even eligible.

The state insisted it’s not that bad but Medicaid is on the federal government’s own list of programs at high risk of waste and abuse.

Now, a review of the Illinois Medicaid program confirms massive waste and fraud.

A review was ordered more than a year ago-- because of concerns about waste and abuse. So far, the state says reviewers have examined roughly 712-thousand people enrolled in Medicaid, and found that 357-thousand, or about half of them shouldn't have received benefits. After further review, the state decided that the percentage of people who didn't qualify was actually about one out of four.

"It says that we've had a system that is dysfunctional. Once people got on the rolls, there wasn't the will or the means to get them off,” said Senator Bill Haines of Alton.

A state spokesman insists that the percentage of unqualified recipients will continue to drop dramatically as the review continues because the beginning of the process focused on the people that were most likely to be unqualified for those benefits. But regardless of how it ends, critics say it's proof that Illinois has done a poor job of protecting tax payers money.

“Illinois one of the most miss-managed states in country-- lists of reasons-- findings shouldn't surprise anyone,” said Ted Dabrowski.

Dabrowski, a Vice-President of The Illinois Policy Institute think tank, spoke with News 4 via SKYPE. He said the Medicaid review found two out of three people recipients either got the wrong benefits, or didn't deserve any at all.

We added so many people to medicaid rolls so quickly, we've lost control of who belongs there,” said Dabrowski.

Continued in article

Some 148,283 of those 350,000 fraudsters ineligible for Medicaid in Illinois have been removed from the rolls as of November 2014
"Reversing the Medicaid Tidal Wave in Illinois," by Merrill Matthews, The Wall Street Journal, November 7, 2014 ---

Every state is struggling with the explosive growth and cost of its Medicaid program. Illinois, however, found a way to reduce Medicaid spending significantly, freeing up money for other important projects—or better yet, tax cuts.

Medicaid, the government health-insurance program for the poor and disabled, covered 72.2 million people for at least one month in 2012, according to estimates from the Department of Health and Human Services.

But enrollment is growing quickly. The Centers for Medicare and Medicaid Services reports that Medicaid and the Children’s Health Insurance Program (CHIP) enrollment is up by about 8.7 million people—nearly 15%—since the Affordable Care Act’s October 2013 rollout. Total Medicaid spending was about $432 billion in 2012. The federal government provided $250 billion, or a bit more than half, but states paid the rest.

For many states, Medicaid is already their single largest expenditure, and now it is demanding more, forcing state governments to limit or reduce spending in other important areas like education and welfare.

Enter the Illinois solution. In 2013, the state faced a Medicaid budget shortfall of $2.7 billion. Springfield had begun implementing some reforms, such as shifting more Medicaid recipients into private managed-care organizations, but that wasn’t enough.

So Illinois state Rep. Patti Bellock garnered bipartisan support to pass legislation in 2012 that included several Medicaid reforms. One of the most important was a provision to establish the Illinois Medicaid Redetermination Program to “redetermine” if Medicaid enrollees were still eligible to participate.

Continued in article

Jensen Comment
States that added residents to Medicaid under Obamacare don't have high incentives to pay for fraud audits since under the ACA the money is coming from the Federal government and not state revenues.

Furthermore, the fraudsters who got new knees, hips, kidneys, livers, and other organs who are finally being taken off the Medicaid rolls got away with their frauds and most likely will not have to pay since suing them would overwhelm the courts. There is high incentive and low risk in cheating to become eligible for Medicaid. Medicaid is totally free for medical services and medications, unlike those high deductible medical plans from the ACA exchanges.

Bob Jensen's universal health care messaging --- http://www.trinity.edu/rjensen/Health.htm

Bob Jensen's universal health care messaging --- http://www.trinity.edu/rjensen/Health.htm

Bob Jensen's Tidbits Archives ---

Bob Jensen's Pictures and Stories

Summary of Major Accounting Scandals --- http://en.wikipedia.org/wiki/Accounting_scandals

Bob Jensen's threads on such scandals:

Bob Jensen's threads on audit firm litigation and negligence ---

Current and past editions of my newsletter called Fraud Updates ---

Enron --- http://www.trinity.edu/rjensen/FraudEnron.htm

Rotten to the Core --- http://www.trinity.edu/rjensen/FraudRotten.htm

American History of Fraud --- http://www.trinity.edu/rjensen/FraudAmericanHistory.htm

Bob Jensen's fraud conclusions ---

Bob Jensen's threads on auditor professionalism and independence are at

Bob Jensen's threads on corporate governance are at


Shielding Against Validity Challenges in Plato's Cave ---

·     With a Rejoinder from the 2010 Senior Editor of The Accounting Review (TAR), Steven J. Kachelmeier

·     With Replies in Appendix 4 to Professor Kachemeier by Professors Jagdish Gangolly and Paul Williams

·     With Added Conjectures in Appendix 1 as to Why the Profession of Accountancy Ignores TAR

·     With Suggestions in Appendix 2 for Incorporating Accounting Research into Undergraduate Accounting Courses

Shielding Against Validity Challenges in Plato's Cave  --- http://www.trinity.edu/rjensen/TheoryTAR.htm
By Bob Jensen

What went wrong in accounting/accountics research?  ---

The Sad State of Accountancy Doctoral Programs That Do Not Appeal to Most Accountants ---


Bob Jensen's threads on accounting theory ---

Tom Lehrer on Mathematical Models and Statistics ---

Systemic problems of accountancy (especially the vegetable nutrition paradox) that probably will never be solved ---

Bob Jensen's economic crisis messaging http://www.trinity.edu/rjensen/2008Bailout.htm

Bob Jensen's threads --- http://www.trinity.edu/rjensen/threads.htm

Bob Jensen's Home Page --- http://www.trinity.edu/rjensen/