A citizen who lives in any one state can buy a toaster produced in any other state. The same citizen can also buy a lawnmower, a sofa, an automobile or virtually any other product — regardless of the state where the product is made.
This same freedom does not exist in the market for health insurance, however.
One of the most important differences facing a congressional conference committee reconciling the Senate and House versions of the 2005 energy bill is a Renewable Portfolio Standard (RPS) that appears in the Senate version but was rejected by the House. It would require all electric utilities selling more than 4 million kilowatt-hours (kwh) per year – which would include all major and many minor electric power systems – to obtain at least 10 percent of their power from "renewable" sources by 2020. In effect the RPS defines renewables by exclusion – sources that are not fossil-fueled, nuclear or hydroelectric. Eligible renewables include windmills, solar power, waste burning, geothermal, landfill gas and exotic sources like the tides.
Currently, 30 states have filial responsibility statutes that establish a duty for adult children to care for their indigent elderly parents. When enforced, the statutes can require the adult child to reimburse state programs or institutions that have cared for the indigent parent with either a one-time contribution or installment payments. Today, there is no uniform federal filial responsibility statute, and indeed, it may be difficult to enact one; but if even a few states began to more systematically enforce their laws, their action could help reduce the explosive growth of Medicaid's long-term care benefit.
President Bush has barnstormed across the country promoting Social Security reform. So far, the president has proposed two primary ideas: 1) Allow younger workers to prefund a portion of their retirement benefits by creating personal retirement accounts equal to 4 percent of wages, and 2) Use "progressive indexing" to reduce the growth in benefits for higher earners.
Over the last decade, the Social Security Administration has evaluated numerous reform proposals. Recently, when evaluating reforms that involve investments in the stock market, the Social Security Administration assumed the historical average annual real stock return of 6.5 percent will persist into the future. The Social Security Administration also projects the future status of the program. These projections are summarized in the annual Trustees Reports and form the basis for scoring the reform proposals. The most recent Trustees Report assumes the real annual gross domestic product (GDP) growth rate will be about 1.9 percent over the 75 year horizon. This assumption is lower than the actual experience of the past 75 years, a period in which the economy grew at a real rate of 3.4 percent a year, on average.
Health Savings Accounts (HSAs) are having an enormously beneficial effect on the design of health insurance in this country. Instead of an employer or insurer paying medical bills, more than one million people are managing some of their own health care dollars. Instead of relying solely on third-party insurance, people can now partly self-insure through these accounts. Yet despite their many advantages, HSAs can be made even better.
For over 30 years, Lester Brown, a MacArthur Foundation "genius award" winner and president of the Earth Policy Institute, has warned that human activities threaten agricultural productivity and human well-being. Brown and other environmental lobbyists argue that continuing human-caused global warming poses a significant threat of world famine. They say hotter temperatures will cause crops to wither on the vine and increase the evaporation rate of moisture from the soil.
Only in the past 20 years have scientists begun to understand that the Earth has a moderate, persistent 1,500-year climate cycle that creates warmer and cooler periods of time. Sunspot records and the isotopes of carbon, oxygen and beryllium trapped in ice cores and cave stalagmites indicate that this process is driven by a small cycle in the sun's radiance.
Medicaid is the largest single expenditure state governments face today. The country as a whole spends more on Medicaid than it spends on primary and secondary education. We also spend more on Medicaid (for the poor) than we spend on Medicare (for the elderly). And at the rate the program is growing, it is on a course to consume the entire budgets of state governments in just a few decades.
The current debate over Social Security reform is reminiscent of the discussions that occurred in Galveston County, Texas, in 1980, when county workers were offered a retirement alternative to Social Security: At the time they reacted with keen interest and some knee-jerk fear of the unknown. But after 24 years, folks here can say unequivocally that when Galveston County pulled out of the Social Security system in 1981, we were on the road to providing our workers with a better deal than Franklin Roosevelt’s New Deal.
Just how big is the funding shortfall faced by Social Security? What is the cost of delay in implementing a solution? The magnitude of the problem can be quantified in two ways: 1) the funds required each year in addition to projected payroll tax revenues, or 2) the present value of the total additional funding required in all future years.
Every year, the Social Security and Medicare Trustees examine the short- and long-term health of these programs, and issue reports that highlight the financial burdens they will create for future generations if nothing is done to reform them. This year's reports show Social Security and Medicare will consume an ever-increasing portion of workers' incomes unless the government either breaks its promises to future retirees or makes significant changes to our elderly entitlement system.
Britain has used personal accounts in its public pension system longer than any other industrial country. Personal accounts fund individual workers’ retirement benefits through savings, whereas pay-as-you-go systems, including the U.S. Social Security system, fund elderly benefits from current workers’ taxes. The U.K. experience provides a good model of how not to do things in America. It shows that personal accounts can be good or bad, depending on how they are designed.
The manifest benefits of nuclear technology – from radiological medical screening and treatments, to smoke detectors, to electric power generation – have not dispelled the common belief that it is unduly hazardous. Of the many areas in which nuclear technology has been applied, perhaps none has been more damaged by the fear of radiation than nuclear power.
U.S. demand for electricity will increase 50 percent by 2025, according to forecasts in the Energy Information Administration's (EIA) "Annual Energy Outlook 2004." At least 350,000 megawatts of new generating capacity – hundreds of new power plants – will be needed before then.
Social Security reform is at the top of President Bush's second term agenda – and for good reason. In the next decade, two monumental shifts will occur: 1) the first of the 77 million baby boomers will start drawing benefits and stop paying payroll taxes, and 2) funds available to pay Social Security and Medicare benefits will fall increasingly short of promises we have made.
In 1996, for the first time in modern history, Congress ended a welfare entitlement. It replaced Aid to Families with Dependent Children (AFDC), the federal-state program that provided cash assistance to poor families, with Temporary Assistance to Needy Families (TANF). An entitlement provides benefits to anyone meeting eligibility requirements, such as income. TANF put conditions on the receipt of cash, including time limits and work requirements — and in just a few years, enrollment fell by 54 percent.
Public pension programs – including the U.S. Social Security system – tax workers to pay current retirees' benefits. But in the United States, as in other developed nations, falling birthrates and rising life expectancies leave fewer workers to support each retiree. Without reform these factors will eventually require large tax increases, large benefit cuts or both to keep the programs alive.
President Bush wants to add a personal investment component to the U.S. Social Security system. Under a Bush-style reform plan, workers would be able to contribute a portion of their payroll taxes into personal retirement accounts, which would pay a gradually increasing part of their retirement benefits.
The present value of Social Security's long-term funding gap is $11 trillion in 2004 dollars. That means we would need $11 trillion in the bank today, earning the government's borrowing rate, to eliminate all of the program's future debt. Another way to reduce this debt is to reduce Social Security's obligations.
Neighborhoods, city councils and the media are debating whether to welcome or discourage big-box retailers. While Wal-Mart comes to mind, big-box retailers are defined as any free-standing store greater than 50,000 square feet, and most big-box stores now range in size from 90,000 to 200,000 square feet. Critics claim that large retailers crowd out mom-and-pop competitors and replace them with windowless warehouses filled with minimum wage workers. Big-box retailers promise economic benefits such as sales tax revenues, jobs, competitive wages and low prices. But do they deliver? Empirical evidence shows that they have provided numerous benefits.
Significant numbers of Americans are traveling across the Canadian border or using the Internet to buy prescription drugs at Canadian prices. These sales are illegal, but should they be? Is importing drugs the solution to high U.S. drug prices?
In 2011, the first group of baby boomers will reach the age of 65. When the last of that generation retires in 2032, 77 million of them will have ceased working and paying taxes and will have begun receiving taxpayer-funded health care and pension benefits.
Consumers recently lost a money-saving opportunity when a Food and Drug Administration (FDA) advisory panel voted against over-the-counter (OTC) access to the cholesterol-reducer Mevacor. This is the third time the FDA has turned down a request to make cholesterol lowering drugs available without a prescription, thus denying consumers the power to control an important aspect of their medical care.
The concept of a minimum wage seems straightforward: If we believe the wages of some workers are too low, we should pass a law requiring those wages to be higher. What could be simpler? The problem is that increasing the minimum wage may make some people better off, but others will be harmed. Experience proves that the minimum wage hurts more people than it helps.