Download the Speaker of the House, Nancy Pelosi’s latest healthcare proposal here, or view it online.   Rep. Pete Sessions provides the following summary points of the 1990 page proposed bill:

Page 94-Prohibits the sale of private individual health insurance policies, beginning in 2013, forcing individuals to purchase coverage through the federal government

Page 110-Requires the use of federal dollars to fund abortions through the government-run health plan-and, if the Hyde Amendment were ever not renewed, would require the plan to fund elective abortions

Page 111-Establishes a new board of federal bureaucrats (the “Health Benefits Advisory Committee”) to dictate the health plans that all individuals must purchase

Page 211-Establishes a new government-run health plan that, according to non-partisan actuaries at the Lewin Group, would cause as many as 114 million Americans to lose their existing coverage

Page 225-Permits-but does not require-Members of Congress to enroll in government-run health care

Page 255-Includes language requiring verification of income for individuals wishing to receive federal health care subsidies under the bill-while the bill includes a requirement for applicants to verify their citizenship, it does not include a similar requirement to verify applicants’ identity, thus encouraging identity fraud for undocumented immigrants and others wishing to receive taxpayer-subsidized health benefits

Page 297-Imposes a 2.5 percent tax on all individuals who do not purchase “bureaucrat-approved” health insurance-the tax would apply on individuals with incomes under $250,000, thus breaking a central promise of then-Senator Obama’s presidential campaign

Page 313-Imposes an 8 percent “tax on jobs” for firms that cannot afford to purchase “bureaucrat-approved” health coverage; according to an analysis by Harvard Professor Kate Baicker, such a tax would place millions “at substantial risk of unemployment”

Page 336-Imposes additional job-killing taxes, in the form of a half-trillion dollar “surcharge,” more than half of which will hit small businesses; according to a model developed by President Obama’s senior economic advisor, such taxes could cost up to 5.5 million jobs

Page 520-Cuts more than $150 billion from Medicare Advantage plans, potentially jeopardizing millions of seniors’ existing coverage

Page 733-Establishes a new Center for Comparative Effectiveness Research; the bill includes no provisions preventing the government-run health plan from using such research to deny access to life-saving treatments on cost grounds, similar to Britain’s National Health Service, which denies patient treatments costing more than £35,000

Page 1174-Includes provisions entitled “TAXES ON CERTAIN INSURANCE POLICIES” to fund comparative effectiveness research, breaking Speaker Pelosi’s promise that “We will not be taxing [health] benefits in any bill that passes the House,” and President Obama’s promise not to raise taxes on families with incomes under $250,000

The House could vote on this massive government takeover of health care as early as next week.  Sacrificing America in the name of communism…it’s a shame.

FT’s Martin Wolf says (ht Tech Ticker),

…the Fed is helping the banks recapitalize themselves.  The banks aren’t lending because they’re still trying to recover from all the lousy loans they made three years ago (and because there aren’t all that many folks to lend to).  So there’s nothing else to do with the money other than hoard it, buy safe Treasuries, and pay huge bonuses…

Dave Callaway tells Market Watch the market was looking for a relief rally. It appears we now need a “cash for Christmas” government program to keep us going…

Econompic points out that auto sales accounts for 1.66% of the 3.50% GDP growth rate reported for third quarter.  Thus,  without government spending, the economy is still in a pickle.  Can we count on the government to keep on spending at this rate forever?

From the WSJ:

The U.S. government is likely to inject $2.8 billion to $5.6 billion of capital into the Detroit company, on top of the $12.5 billion that GMAC has received since December 2008, these people said. The latest infusion would come in the form of preferred stock. The government’s 35.4% stake in the company could increase if existing shares eventually are converted into common equity.

[Helping Hand]

Federal officials also are moving to shore up GMAC’s ability to fund its daily operations, with the Federal Deposit Insurance Corp. telling the company Tuesday the agency will guarantee an additional $2.9 billion in debt, according to people familiar with the discussions. The FDIC guarantee will make it easier for the company to sell debt to investors. The FDIC backed $4.5 billion in GMAC-issued debt earlier this year.

We now make a prediction:  GMAC will be the first of many.  Due to cash flow, several more TBTF banks will come back to the bailout trough over the next 6 months…

Harry Dent’s update from October 16 is below.  He’s looking for a top soon:

CNN says that “economists are predicting that the nation’s gross domestic product (GDP) rose 3.2% on an annualized basis in the third quarter. That would be the strongest level of growth in two years. The official number comes out Thursday.”  Could late Thursday be the time to sell this news?

Bill Frezza has some skeptical thoughts about the recent move to subsidize financially ailing newspapers:

Behold the “Independent Journalism Tax.”

In order to preserve independent journalism in the age of the Internet, a national Fund for Local News should be created with money the FCC now collects from or could impose on telecom users, television and radio broadcast licensees, or Internet service providers.

This is the key recommendation buried on page 91 of a 100 page report issued last week titled “The Reconstruction of American Journalism” by Leonard Downie, Jr. Vice President of the Washington Post, and Michael Schudson, a professor at the Columbia School of Journalism.  In the current era of single party rule, is there any chance that this further intrusion of the government into our lives might actually come true? Might we one day be forced to pay a tax every time we make a cell phone call to make sure the Press Room in the White House is stuffed with even more reporters eager to credulously swallow whatever nonsense comes out of the President’s mouth? Could truly independent newspapers be forced to compete with government subsidized lapdogs like, say, truly independent banks or car companies?

Yup, this idea is not really intended to support the newspapers, it’s intended by the Obamunists to make government control of the once free press permanent in the US.

Denninger has been labeling the failure of our government to close bad banks earlier to minimize the 40% and 50% level catastrophic losses the taxpayer has been having to eat the last couple of years as “malfeasance”:

How can anyone possibly believe, given the overwhelming history of the last two years in this crisis, that the nation’s banks are claiming and carrying their assets at anything close to their actual value when we continue to see, week after week, losses to the deposit insurance fund proving that close to half of the claimed “asset value” in these seized banks is a pure, unadulterated fiction?

We agree.  But there’s more to it than that. The fact that banks’ asset values are being misrepresented is indeed the reason why the banks aren’t being closed closed in a timely fashion.  But the real important issue relates to what ultimately causes the banks to go belly up and be closed… despite their fictionalized balance sheets.  The answer is cash flows.  The ultimate proof of insolvency is inability to pay obligations as they come due.  Denninger’s post of an analyst’s demonstration that the cash available to JP Morgan/Chase has deteriorated substantially helped lead him to conclude that a credit lock-up may be imminent.  We believe that without the government’s recent systematic enabling of large bank trading incomes, the cash flows of large banks would have already been insufficient to meet their obligations.   The TBTF’s massive “speculation” is made sure through special access to information, manipulation and socialization of any losses.  Their trading cash flow appears to be the only thing standing between the big banks and the abyss.  Can they keep this up?

John Mauldin is in the “mild” inflation camp, while Bill Bonner is in the deflation camp.  Mauldin cites the elements resulting in a tendency toward deflation as rising unemployment, massive wealth destruction, decreased final demand, low capacity utilization, massive deleveraging and a very weak housing market. But, then he bravely argues that our powerful, benevolent Federal Reserve will allow neither Bonner’s deflation scenario…nor large rates of inflation as posited by Peter Schiff:

The Fed is going to do what it takes to bring about inflation (in my opinion). But they will not monetize US government debt beyond what they have already agreed to. If they need to “print money” to fight deflation, they can buy mortgage or credit-card or other forms of private debt, which have the convenience of being self-liquidating. Read the speeches of the Fed presidents and governors. I can’t imagine these people will recklessly monetize US debt. You don’t get to their level without having a stiff backbone.

Mauldin’s apparent  blind faith in an effective, competent, and non-captured FED seems out of character.  It’s probably not naivete’ , but whatever else it is, it’s dangerous advice to bet on a potent FED in these times.  For our own part, the elements supporting deflation, as listed by Mauldin, are outside the FED’s control.  If they were within the FED’s control the FED would never have allowed them to begin in the first place.

The table below compares the White House’s February 2009 projection of the number of jobs that would be created by the 2009 stimulus law (through the end of 2010) with the actual change in state payroll employment through September 2009 (the latest figures available). You can think of this as a scorecard for the Obama administration’s predicted 3.5 million jobs created by the end of 2009 due to the 2009 stimulus.

To summarize the data for you: So far, the 2009 stimulus has completely failed to bring about anything close to what the Obama administration predicted. Anyone think we can make up these numbers in 14 months?


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