U.S. Economic/Financial News
NerObama Proposes To Raise Medicare Age to 67
July 12 (EIRNS)The Huffington Post's Sam Stein reports, from "five separate sources with knowledge of negotiations, including both Republicans and Democrats," that one of Obama's proposals to slash trillions from the U.S. budget is to raise the eligibility age for Medicare from 65 to 67. This would mean that approximately 7 million Americans would be denied Medicare coverage when the program phased in after 2013.
The Kaiser Foundation estimated that raising Medicare eligibility to 67 would cost about $5.6 billion in out-of-pocket costs to the American people. Besides the costs to those who lose Medicare directly, the rates for those under 65 would rise, because the younger and generally healthier seniors would be added to the pool on the new "exchanges" created by the Obama health plan, and Medicare Part B rates to those over 67 would rise for the same reason. Costs to employees would rise by about $4.5 billion, and costs to states would rise by nearly $1 billion, even as they are all facing bankruptcy.
Federal "savings" (i.e., blood money) would supposedly be about $124 billion over seven yearsonly $18 billion per year on average.
Minnesota Budget Standoff Ends with Governor's Capitulation
July 15 (EIRNS)The two-week shutdown of the Minnesota state government functions has ended with a whimperlacking the real solution which only Congressional enactment of Glass-Steagall could provide.
The deal to erase a $5 billion deficit came after Democratic Gov. Mark Dayton dropped his campaign promise of more income taxes on the wealthy. He then accepted virtually the same offer the Republicans made on the eve of the shutdown: to cut $1.4 billion from the budget deficit through the sleight-of-hand of delaying $700 million in payments to the schools until the 2013 fiscal year, and floating a new bond for another $700 million. Republicans agreed to Dayton's demand to give up a plan to cut the state's workforce by 15%, and gave up their demand for a ban on stem cell research.
This is similar to the Illinois budget deal, by which $1.36 billion in Medicaid costs will be transferred to fiscal year 2013.
No Hiring in a Destroyed Economy
July 13 (EIRNS)Another very large survey underlines the collapse in hiring by U.S. corporations of less than 500 employees, the ones who are supposed to be "the job creators" in Congressional mythology, but are unable to find either investment capital or demand.
The survey, conducted for the U.S. Chamber of Commerce by Harris Interactive, interviewed 1,400 businesses nationwide, and was released at a Chamber of Commerce "jobs summit" on July 12. Its conclusion was that nearly 80% of the businesses don't plan to hire any employees over the next full year; 64% plan to keep the same number of employees they have now; 12% plan to reduce their workforce.
Unemployment among young workers is officially 25%; among veterans, 16%; among Black Americans, 16%.
Nation's Unemployed Face Oblivion as Extended Benefits Expire
July 11 (EIRNS)At the end of this year, even the extended unemployment benefits which Obama negotiated by trading away the Bush-era tax cuts for the rich last Decemberwill expire. As a result, according to an article in this morning's New York Times, the nation's unemployed families are facing a loss of $37 billion in combined income. In fact, during the last year, fully $2 of every $10 (20%) of family income has come from some sort of Federal programSocial Security or disability, unemployment benefits, or food stampsaccording to Moody's Analytics. Total government payouts were upfrom $1.7 trillion in 2009, to $2.3 trillion in 2010 (about 35% increase)with 7.5 million Americans collecting (relying on) benefits of one sort or another.
An estimate by the Arizona Dept. of Economic Security is that 45,000 residents could lose benefits by year's end, and there are still 10 applicants for every job opening (twice national average of 4.6) in the state. The state of Florida is even worse, with 476,000 unemployment recipients; Michigan has 276,000, with $6.2 billion in state funds expended for jobless benefits last year.