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What None of the Presidential Candidates Knows About Health Insurance

What None of the Presidential Candidates Addresses About Health Insurance

By Joel D. Joseph, Chairman, Made in the USA Foundation

At the Democratic debates, the issue of healthcare took center stage. There were two camps: one for Medicare for all, the other for allowing Americans to keep their employer-paid health insurance. Not one of the candidates mentioned that private health insurance paid for by manufacturers, like General Motors, and costs the American economy millions of jobs.

President Trump, on the other hand, has no healthcare plan at all—he is still fighting Obamacare.  Apparently, Mr. Trump does not understand that our private health insurance system makes the United States less competitive in the world economy.

In Canada, General Motors saves $1,500-$2,000 per car because health insurance is paid for by Canadian provincial governments.  This has increased Canadian auto manufacturing significantly.  Canada manufactures one-third as many cars as are made in the USA, but has one-tenth of the population.  In other words Canada makes three times as many cars as the United States per capita.  This is primarily a result of the way Canada finances healthcare.

Similarly, all European countries cover workers health insurance, keeping those costs away from manufacturers.  The massive German auto industry thus has a significant cost advantage over U.S. car manufacturers.

In Mexico, Ford, GM and Chrysler pay workers $2 an hour, less than they pay in the United States for health insurance alone.  Before NAFTA, Mexico hardly made any vehicles.   They made 547,000 cars in Mexico in 1990, a few years before NAFTA went into effect. Today, they make 4 million cars in Mexico annually compared to only 3 million cars made in the USA. Mexico manufactures more cars than the United States with only 40% of our population.

What Can We Do About It?

If health insurance were paid for by the government, all U.S. manufacturers will be more competitive.  This means that members of the United Auto Workers will have to give up their gold-plated private health insurance.  In exchange, the U.S. auto manufacturers, including Honda, Toyota, Mercedes, Volkswagen and BMW, should pay their workers more.

Presidential candidate Andrew Yang wants the government to hand out $1,000 per month to every man, woman and child in the United States.  Instead of this outlandish give-away, the federal government should cover Medicare for all Americans, with no premiums and 100% coverage.  This would level the playing field and allow American manufacturers to compete in the global marketplace.

Medicare for All is Not Enough

Medicare is exceptionally complicated.  The government pays for Part A, which covers eighty percent of hospitalization costs.  Part B covers out-of-hospital care, and it costs about $135 per month to cover 80% of the costs.  Most retirees then pay for additional private insurance to pick up the 20% that Medicare doesn’t pay for.  I pay about $180 a month for this coverage.   So even though I am on Medicare, I pay more than $300 per month for supplemental private insurance.  All of these additional expenses should be covered by the federal government, as they are in Canada and Europe.

How Would We Pay for It?

Corporations are now paying a smaller proportion of the federal budget than they ever have.  In 1960, when John F. Kennedy was president, the corporate income tax accounted for 23 percent of all federal revenue.  Now corporations are paying less than 10% of federal revenue.  The Trump tax reduction lowered the U.S. corporate tax rate to 21%.   The top individual tax rate is 37%.   In 2010, in the Citizens Unitedcase, the U.S. Supreme Court ruled that corporations are people under the constitution and entitled to constitutional rights. If corporations are persons under the constitution, then why should they pay a lower rate than individuals? If corporations have equal rights, they should pay equal taxes.

Because of tax loopholes, massive corporations like General Electric and Amazon pay no federal income tax at all.  This must change.  If we get rid of all tax loopholes and tax corporations at the same rates paid by individual taxpayers, we can provide every American with government-paid-for healthcare.

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Trade War With China is Good for United States

By Joel D. Joseph, Chairman, Made in the USA Foundation

In 1972 we did not trade with China at all.  Unemployment was at a low 5.2% and the GDP growth rate was 5.3%.  In 1973, unemployment went down to 4.9, while the GDP growth expanded to a robust 5.6.  There was a small trade deficit with the world in 1972 and a small trade surplus 1973.  Since that time, China has taken five million manufacturing jobs away from the United States.  Trade with China has impoverished American blue-collar workers while raising living standards in China.  This trade has become a one-way street leading to the decline of the United States.

Expanding Trade with China did not Lead to Democratization

Nobel-prize winning economist Milton Friedman wrote in Capitalism and Freedom, “[T]he kind of economic organization that provides economic freedom directly, namely, competitive capitalism, also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other.”   Similarly, President George W. Bush made the same point about China: “I believe a whiff of freedom in the marketplace will cause there to be more demand for democracy.” Both President Bush and Milton Friedman were wrong:  The last twenty years has clearly demonstrated that China is not more democratic now.  China is now trying to strangle freedom in Hong Kong and put down protests there.

The U.S. Economy is Too Entangled with China’s Economy

China became a member of the World Trade Organization (WTO) in December, 2001. The admission of China to the WTO signified China’s deeper integration into the world economy.  Now China supplies the United States with more products and components than ever: auto parts, laptop computers, iphones, shoes, clothing and toys.  It is difficult to go into a retail store in the United States and find products not made in China.

Soviet dictator Vladimir Lenin wrote, “When it comes time to hang the capitalists, they will vie with each other for the rope contract.”   The same principle is strangling the United States in China: capitalists have moved five million jobs from the United States to China, cutting their own throats to save a few bucks.

Unbelievably, the U.S. Defense Department is now importing Chinese rocket fuel for Hellfire missiles. This not only weakens the U.S. economy, it directly threatens our national defense. The AGM-114 Hellfire is an air-to-surface missile developed primarily for anti-armor use. 

The United States is completely dependent on a single Chinese company (1,2,4 Butanetriol) for the chemical needed to produce the solid rocket fuel used to propel Hellfire missiles. As current U.S. supplies diminish, our military will be dependent on China to maintain this missile system. Hellfire missiles are a critical component in America’s arsenal. Common sense dictates, “Thou Shall Not Rely on China for Weaponry.” Retired Brigadier General John Adams wrote a report recently titled, “Remaking American Security: Supply Chain Vulnerabilities & National Security Risks Across the U.S. Defense Industrial Base.” In this report, General Adams said, “America’s vulnerability today is frightening. This report is a wake-up call for America to pay attention to the growing threat posed by the steady deterioration of our defense industrial base.  Excessive and unwise outsourcing of American manufacturing to other nations weakens America’s military capability.”

Importing these crucial products also violates principles of common sense that we should not be reliant on supplies from countries that may be in a shooting war against the United States or our allies. Let’s put common sense and independence back into the Pentagon’s thinking.

Huawai

The Wall Street Journalreported, “Huawei Technologies Co., the world’s largest telecommunications company, dominates African markets where it has sold security tools that governments use for digital surveillance and censorship. But Huawei employees have provided other services notdisclosed publicly. Technicians from the Chinese powerhouse have, in at least two cases, personally helped African governments spy on their political opponents, including intercepting their encrypted communications and social media, and using cell data to track their whereabouts, according to senior security officials working directly with the Huawei employees in these countries.” Huawei is controlled by the Chinese Communist Party and cannot be trusted.

5G technology, the latest cellphone technology is a new front in the trade war with China.  It pits Chinese controlled Huawei against U.S. technology companies like Qualcomm.

The Positive Effects of the Trade War

We have been in a trade was with China for twenty years.  However, the American government and most people did not realize that we were in a trade war. We believed, wrongly, that free trade with China was good for the U.S. economy and that free trade would democratize the Middle Kingdom.  Now that Apple Computers is aware that assembling iphones in China makes it vulnerable to tariffs, it should move production to the United States. The company that assembles these phones in China, Foxconn, is currently building a large assembly facility in Wisconsin, so this insourcing can actually take place within a few years. Similarly, the U.S. government and European government must guard against the intrusion of Chinese spyware contained in Huawei 5G equipment.  The trade war is waking up Americans who have not realized that our economy is too entwined with the economy of Communist China.

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Saudi Arms Deal Must Be Stopped!

President Trump Violates Letter and Spirit of Buy American Act and the Berry Amendment in Saudi Arms Deal

Congress passed the Berry Amendment in 2001 to make sure that the Department of Defense purchased weapons and other defense materials from domestic sources. This law ensures that the United States is not reliant on foreign sources for weapons and supplies. Contrary to the Berry Amendment and other “buy American” laws, President Trump announced that he is allowing Raytheon-made Paveway smart bombs to be co-manufactured in Saudi Arabia. Trump claims this is an emergency situation, which it clearly is not.

Bypassing Congress

This transaction will give the Saudis access to U.S. technology to produce its own version of these high-tech bombs. The Trump administration pressed ahead with this deal without congressional approval, declaring an “emergency” based on what it said was a heightened threat from Iran.

The dealcame as a surprise to lawmakers, who were outraged that the administration chose to bypass Congress. Most members of Congress only learned of this deal days after it was announced on May 24th. Congressional aides reported that this deal opens the door for Saudi Arabia to host the production of electronic guidance and control systems for Paveway precision-guided bombs.

Lawmakers opposed to the deal said the production scheme sends the wrong signal to Saudi Arabia given its human rights record and its air war in Yemen. It also raised security concerns about sharing so-called “smart bomb” technology with Riyadh and undercut one of President Donald Trump’s arguments for selling weapons to the Saudis to generate jobs in the United States.

“The concerns over this sale are only one more reason showing the importance of congressional review and why it is deeply disturbing that the Trump administration is trying to circumvent the law and Congress to give the Saudis not only American jobs but also American weapons technology,” Sen. Bob Menendez of New Jersey, the ranking Democrat on the Senate Foreign Relations Committee, said.

Human rights, U.N. investigators and aid groups have accused Saudi Arabia of striking civilian targets, including hospitals and schools, in indiscriminate bombing raids in Yemen since the Saudis launched an armed intervention against Houti rebels in 2015. Congressional resistance to weapons sales to Saudi Arabia only developed after the brutal murder last year of Saudi writer and Washington Post columnist Jamal Khashoggi in the Saudi consulate in Istanbul.

Congressional Action

Two senators introduced a bill designed to force a vote on current and future U.S. arms sales and other military support to Saudi Arabia, saying it was time lawmakers checked President Donald Trump’s attempts to bypass Congress on foreign policy.

The bill, sponsored by Sens. Todd Young, R-Ind., and Chris Murphy, D-Conn., who both sit on the Foreign Relations Committee, marks the latest response by lawmakers who strongly oppose selling weapons to Saudi Arabia. “The process we are setting in motion will allow Congress to weigh in on the totality of our security relationship with Saudi Arabia, not just one arms sale, and restore Congress’s role in foreign policy-making,” Murphy announced.

Murphy and Young’s resolution would allow Congress to vote on not only the expedited arms deal, but to block or restrict future weapons sales and military assistance to Saudi Arabia.