As usual, our government finds it wise to punish good behavior. If you are a small growing business, you better not hire anyone once payroll reaches $499,999. Once you cross over that line, you are in the cross hairs of government regulators who decide how you must treat your employees. If you don’t do what they say, you will pay more taxes.

The House bill mandates that employers with payrolls above $500,000 must contribute — for each full-time employee — 72.5% of the premium cost for single coverage and 65% of the premium cost for family coverage. The penalty for failing to do so is a 2%-to-6% tax on employers with payrolls between $500,000 and $750,000 and an 8% tax for employers with payrolls above $750,000.

via Small Business Crunches Numbers – WSJ.com.

So how does this promote job growth? Business aren’t in the business of charity. If they must spend more on health care or even worse send money to Washington, they are not going to have that money to grow and to create jobs. Those employees will get less pay, because businesses figure out the overall cost of employees. If they budget X for a certain position, the person will get X minus health care, minus taxes, minus social security, minus unemployment insurance, minus workers comp, minus other benefits, and minus any other business cost associated with that employee.

If an employee takes care of themselves and their employer didn’t pay for their health insurance, they would have more money in their pocket. The employer would be able to pay more for the position without the extra costs.  Shopping for themselves, the employee would get better rates and maybe buy a low premium, high deductible insurance plan. This would increase their income substantially. Because businesses are forced into buying health insurance for all regardless to health conditions of each individual, their plans are more expensive and eats more money out of the healthy worker’s pocket. This lowers the standard of living for all workers, and is more punishment for doing the right things.

In the movie “The Last Boy Scout”, Bruce Willis would ask people that he was about to punch, “Head or Gut?”. If you were an unlucky person who didn’t understand the question, you got both. This is similar to how the government treats industries that they want to get involved in. Apparently, the utilities are asking for the gut, thinking it will be less painful.

The executives’ desire for prompt action is colliding with Washington’s focus on other issues and growing reluctance to tamper with power-industry costs during a weak economy.

An American Electric Power coal plant, with a new carbon-capture unit, in New Haven, W.Va. Most power companies don’t think any effective, affordable technology exists to capture and store their carbon-dioxide emissions.

Some executives said last week they think intervention by the Environmental Protection Agency would be doomed because, for the most part, all the agency can do is order firms to install “best available control technology.” Most power companies don’t think any effective, affordable technology exists to capture and store carbon-dioxide emissions from power plants.

Most power companies prefer so-called cap-and-trade legislation to EPA regulation because the former is expected to give them greater flexibility on how to comply and thus cost them less than EPA regulation, they say.

Still, plenty in the utility sector continue to oppose legislation to cap carbon emissions.

Under cap-and-trade legislation — which the House has passed but the Senate hasn’t vote on yet — the government would require companies to hold permits to emit greenhouse gases. Over time, the government would issue fewer permits, bringing emissions down gradually while allowing companies to trade the permits among themselves. Companies that find it too expensive to reduce their own emissions could pay other firms to reduce theirs. They could also invest in activities that offset carbon-dioxide emissions, such as planting trees.

The EPA would be “forced to pursue a technology road map that doesn’t exist,” warned Jim Rogers, chief executive of Duke Energy Corp., Charlotte, N.C., who also has lobbied the Hill repeatedly to pass a bill.

John Rowe, head of Exelon Corp., Chicago, said that EPA regulation would be “more arbitrary, more expensive, and more uncertain for investors and the industry than a reasonable, market-based legislative solution like cap and trade.”

The executives said they want legislation — and soon — because utilities need to make billions of dollars of investments in coming years and risk bad choices in a legislative void.

via Some Utilities Push Congress to Act on Carbon Emissions – WSJ.com.

Guess who the people are who don’t understand the question? That would be the you and me. We are about to get both in the form of a huge increases in the cost of living. This will come in our utility and health care costs. Not only that, each one of these touches every other part of our lives. Every business is going to be affected by these increased costs, which means they will have to raise prices of their products.

Instead of picking either head or gut, utilities should throw the first punch. They should be telling the public/customers what this means to them. Then again, the government could tell them they can’t do that. Look at Humana during the health care debate. But hey, luckily we still have freedom of speech right?

This weekend the house moved the nanny state a little further down it’s evolutionary track toward tyranny. The statists, such as Nancy Pelosi, are acting like Lucy holding the football for Charlie Brown. “Come on Charlie Brown. I swear I’ll let you kick the ball.” Falling for the same old trick, pro-lifers, so-called Blue Dogs and various health companies bought into the trick.

Mrs. Pelosi’s craftiest political turn was a last-minute compromise to strip federal funds from insurance plans that cover abortions. The deal—negotiated by Michigan Democrat Bart Stupak and supported by the National Right to Life Committee—gave cover to 40-some Democrats to support the larger bill.

However, as subsidized costs soar, government will have no choice but to ration medical care, starting with the aged and grievously ill. Is pre-natal life more valuable than the elderly? We’re reminded of the way pro-lifers supported Anthony Kennedy over Laurence Silberman for the Supreme Court in 1987 merely because Mr. Kennedy was a Catholic who claimed to personally oppose abortion. Mr. Stupak played the right-to-lifers like a Stradavarius.

The real importance of the abortion uproar is as preview of the politics that will dominate every medical coverage issue if ObamaCare becomes law. Every decision of what to insure or not—when an MRI can be used, or whether a stage-four breast cancer patient can get Avastin or some future expensive drug—will become subject to political intervention over moral disputes or budget constraints. Heretofore, these decisions have largely been made between a doctor and patient. This is the real “right to life” issue.

Perhaps the most unsurprising news in this drama was the collapse of the Blue Dog “deficit hawks.” Enough of them always cave in the end to give Mrs. Pelosi her way. It’s nonetheless worth noting the surrender of that most vocal scourge of deficits, Tennessee’s Jim Cooper, who voted aye on grounds that the bill can be improved in the Senate.

via Pelosi’s Health Care Means Rationing Politics – WSJ.com.

If the pro-lifers think for one second that ObamaCare won’t cover abortions shortly after it’s passed, they apparently don’t follow politics much. The same goes for so-called Blue Dogs. The government never stands at a steady state. Like the universe, it’s always expanding. Once it gets its hooks into health care, it will act like a parasite devouring its host.

Anytime the government is involved in the economy, it claims to have the “right” to tell companies, people, etc what to do. Just ask all those on Wall Street who’s pay is not regulated. They didn’t agree to bailouts with that as a stipulation. They signed on, and that was sprung on them after the fact. When the government is involved, contracts and agreements don’t count. You fell for it again, and Pelosi is about to move the ball.

If you read my first post you know capitalism and the free market have nothing to do with greed. Greed is a derogatory term used to undermine self interest. Everyone pursues their own self interest, even the bleeding heart liberal who shouts compassion from the roof tops. True compassion comes from the person who earns and then voluntarily gives up part of their earnings to help another. Compassion is not sacrificing your fellow man for your belief in your own, false altruism. Milton doesn’t argue the word greed, but he pretty much shuts Phil Donahue down.

Being a huge UFC fan, this analogy has to be my favorite of all time.

I’ll borrow an analogy from Peter Schiff. Imagine if you will a victim at the unfortunate end of a Brock Lesnar knuckle sandwich. The blow has knocked him out cold and the medics try to revive him. The best suggestion they can come up with is to have Lesnar pound the man’s head even harder with his fists. When the man has seizures from the repeated pounding, a medic (coincidently named Bernanke) screams gleefully “Hurray, he’s moving.”

Sadly, such is the response to our present crisis by the policy makers in Washington, DC. To solve a problem caused by malinvestments resulting from easy credit at 1 percent interest rates, the Fed is supplying even more easy money at 0.25 percent. None of the malinvestments have been allowed to be liquidated.

Housing prices have been propped up, banks and auto companies have been bailed out, regulations have been increased, debt covenants have been violated, unemployment insurance has been extended. In addition, there’s the cap-and-trade bill, the healthcare bill, and a “czar” around every corner.

All of these increase the already-humongous burden on wealth creators. In short, the problems that caused the Great Recession have been compounded. Real output must then necessarily decline. How can anyone logically assert that we are in the beginning of a recovery?

via A Path To Runaway US Inflation – Ganesh Rathnam – Mises Institute.

Just found this video on YouTube. YouTube just rocks. As I like to say, THANK GOD FOR THE FREE MARKET. YouTube would have never been developed by socialists.

Fannie Mae announced a new “deed for lease” program, where they will take your deed and rent your house back to  you if you don’t qualify for a loan modification and can prove you can’t pay your mortgage. They will sign a one year lease with the current owners. They are hoping they can then sell off the houses a year from now, when they assume the housing market will be better and the value of the homes will be higher. This is some pretty optimistic thinking from a now government owned institution.

What would make them think the housing market is going to pick up that much over the next year. So far, unemployment continues to rise. The Fed has been busy at the printing press, and the government is taking debt levels into unknown waters. More than likely if the economy begins to pick backup, we are going to have massive inflation. That will lead to two scenarios. Either we’ll have hyperinflation that makes the 70s look like child’s play, or we’ll have a Fed induced recession to bring inflation under control. Neither scenario paints a pretty picture for a booming housing market.

Fannie Mae and Freddie Mac (Freddie is already doing something similar) are only delaying the inevitable. The market is much smarter than the government is. It will take into account that these government institutions have a ton of inventory being hidden from the market, what analyst call “shadow” inventory. If the housing market begins to pick up, it will be driven back down with this excess inventory. Instead, Fannie should take the short term pain and end it quick.

Because of Fannie’s mistakes it is asking the government (me and you) for another $15 billion after a quarterly loss of $18.9 billion. In total, it’s estimated that we will have wasted $200 billion on both Fannie and Freddie by the time this mess is over. Then again, we know how reliable government estimates are. So far we have handed over $61 billion to Fannie, and estimates are that Fannie is sitting on inventory around 65,000 homes.

Instead of becoming landlords, why doesn’t Fannie and Freddie sell of packages of houses as investment bundles. This would get the houses off their books, and it would bring them back into the free market where they can begin to stabilize the market. Investors will buy theses homes, and guess what they’ll have to do? They have to pay taxes on their profits, which ultimately will help with the government losses that will occur with the sale. With the investors holding properties, they will want to drive prices up. They’ll either rent them out, which investors are better at than the government, or they will fix up the homes and put them back on the market. Investors will not shoot themselves in the foot by flooding the market. They will slowly bring the houses onto the market to maximize sale prices and make the most profit. Whether renting or selling, the investor will be paying taxes on his capital gains.

The government should just take the short term pain of selling them off now? This may hurt the housing market, but it will be over and stabilization can begin. Instead, the government is prolonging this crisis and making it worse, and who’s going to eat this mess? We are.

By way of Mises.org, here is another great examples of the free market delivering a plethora of choices for consumers. Take note of the mention of the government forced recycling programs and why they started them.

Also, image what it would be like if the beverage industry was heavily regulated like health care. Think you’d have all these options. Inversely, if government would get out of health care, you’d see a plethora of options in that industry as well.

Thanks again to HotAir. I always pick up good info there.

Are you shocked? If you’ve been following my blog, you’re not. Everything the government touches is an abysmal failure. Why would our President be any different?