2010-08-13 / Columnists

Commentary On Things Present

FinReg, MedReg And Me
By Peter Stubben

I just got a little letter from my bank.

My no-fee checking account – an account I’ve had for over ten years – is now dead and gone reports my bank ... bathed not like those poor Gulf Coast sea turtles in BP crude oil, but bathed in the bombastic platitudes of our Congress and my president.

As he signed last month’s finance reform, our president said ... “These reforms represent the strongest consumer financial protections in history. These protections will be enforced by a new consumer watchdog with just one job: looking out for people — not big banks, not lenders, not investment houses — in the financial system. Now, that’s not just good for consumers, that’s good for the economy.”

Thank you, President Obama.

Meanwhile, in the real world my bank has just notified me that it now – regretfully – will charge me a monthly fee, and will charge me for check writing, and will charge me for a lot of other services ... all new fees. A ‘Super’ account, though, will over-ride all these new fees. The small account holder – like me – is being squeezed by FinReg.

Whiz-kid Congressman Barney Frank, backed up by Rockaway’s two reps, Meeks and Weiner, aligned and pontificated to ‘get the banks’ ... you know, the boys who lent too much money to too many people, and then leveraged their own balance sheets to the edge of extinction.

What’s reformed: well, the banks have now consolidated into even bigger behemoths; a new ‘super-agency’ will watch over them like the SEC has watched over stocks for the last 78 years; the uptick rule remains banned (much to the delight of the flash traders); Fannie & Freddie underwriting standards remain unimproved; the ratings agencies remain untouched; and life just gets more regulated and more expensive for me and you.

Can I call your attention, though, to a far more dangerous and deadly reform? The US health industry is cutting edge, and the envy of the world. Don’t ask me, ask the tens of thousands from overseas who come to Boston, NYC, Miami, Houston and LA each year for treatments. That said, should Congress seek more health care availability for all Americans, and should they be legislating health insurance reform? ... yes, without a doubt!

Congress, though, led by Rockaway’s Weiner and Meeks is abandoning US systems, rather than modifying them, to dumb down US Health-Care to Brit and Canadian levels ... and that is a looming tragedy! Your heath care and my health care – from the GP to the operating table to the Rehab Institute – is presently being sabotaged by DC.

Like an 18-year-old reporting to Selective Service, soon every young (and old) American will have to report to DC and prove to IRS that they have paidup health insurance. If not, they will pay a fine. Is that constitutional? Noincome Americans will be given free health care through Medicaid, and low incomers will pay subsidized fees for health insurance.

How much, you ask, and who pays? The Congressional Budget Office estimates $938 billion over ten years, to be paid by (a) cuts to the ole folks Medicare, and (b) taxes ... that is, taxes on insurance plans (Bloomberg News estimates a 40 percent excise tax), taxes on insurance companies, taxes on medical device makers and taxes on the pharmaceuticals.

Health care that’s free or cheap means, naturally, that people will be lining up at the clinic or the ER demanding to be restored to the health of their 25-year-old children ... irrespective of the costs. Powerful politicians will be demanding new hospitals and new research centers built in their districts. Project bidding might look like what we just witnessed here ... the Aqueduct mess ... where it took nine years to approve a developer to remodel a race track. There will be DC agencies, state agencies and county agencies – some 68 grant programs, 47 bureaucratic entities, 29 demonstration or pilot programs, six regulatory systems, six compliance standards and two entitlements – all regulating and catching up to the crooks, too. The editor of this newspaper asked two weeks ago, ‘How the feds could not have picked up the fact this woman had 3,744 claims in six years. That’s nearly 625 claims a year, nearly two a day.’ That surveillance (or better, lack of surveillance) is a local effort for a local program, today. Magnify the crime and the dollars exponentially, with DC care.

Government, for the most part, is wholly and absurdly inaccurate in estimating costs and outcomes. The MTA, for instance, estimated their downtown Manhattan Fulton Street project – to link the tubes to the subway – would cost $400 million and take four years. It’s now been eight years and $800 million, and UNFINISHED! The $935 billion CBO projection will more than double, I expect, to some $2 trillion, requiring even bigger cuts to Medicare and even higher taxes to cover escalating costs.

The health industry will stultify as well, not from gross negligence, but from gross overbearance. Drug makers will need to prove efficacy, not just to the FDA for a new drug, but to the responsible Cabinet Secretary, as well as to the House andSenate chairs of the appropriate jurisdictional committees. The nation will look more and more like Albany, NY; and Rockaway’s congressmen – who lobbied hard across the country and on the national media to pass this reform – couldn’t be more happy.

Is all this ‘reform’ reversible?

You bet it is, but it depends on me and you on Tuesday, November 2. Be there, please.

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