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We're All Americans

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An alarming fact: something like 100 million of us in the United States live at or near the poverty line. Another: according to an NPR program on dentistry, 50% of children in America receive their dental care through Medicaid providers or state programs.   The program suggests that most of this type of care (except for one program in Alabama) is pretty lousy — providers seem to most often go for the highest-reimbursement procedure, e.g. an extraction instead of a filling. The population clock estimates our current population as about 314 million, and so a lot of us are poor, and there is clearly a squeeze on the middle class.  

Both presidential candidates are wealthy men, and it’s certain Romney has more, lots more. He’s older than Obama, and he was president of a successful PE firm. Obama, according to, has between $2.8 million and $11.8 million. He gave 100% of his Nobel Prize money ($1.4 million) to charity, and so that sum is not included in the total.

Poor people are not necessarily unhappy people. Although, many who are not poor often equate poverty with unhappiness.   The truth is that, whether rich or poor, unhappiness is probably spread around pretty equally. Comfort and security are different stories.   

In a sense, the coming election is not just about who can fix the economy. (And, fortunately or unfortunately, no matter what a candidate says, any president can’t do that alone, even though they often say to the contrary. The two houses of Congress are involved, and our government is no longer run by a king.) It’s about rich and poor, too.

You may feel Obama is socialistic and out to help the poor guy at the expense of the rich guy, and you might be right. (His tax collection policies for the Affordable Care Act and the constant nattering about the $200,000/$250,000 tax thresholds would seem to indicate this may be true.) Or you may feel Romney is about helping the rich at the expense of the poor and that he is capitalistic. If he is elected in November, he won’t be able to cancel or change the Affordable Care Act until he takes office, assuming he has the support required in the Senate and House. Remember, please, the newly elected politicians have no power at all until the afternoon of January 20th, 2013. Romney says he understands capital creation and jobs and his background would indicate that this thought may be true. However, government is pretty lousy at creating jobs … or anything else. 

Milton Friedman, the economist and thinker from the University of Chicago, still an economic powerhouse, famously said, in connection with the war on drugs, “The government has no more right to tell me what goes into my mouth than it has to tell me what comes out of my mouth.”   He thought government should only be involved in things like road building and that most other activities were better left to the creative forces of a free market. Think of the money federal, state and local governments spend on fighting drugs.  

If there are 100 million poor people in this country and there are 28 million federal, state and local government workers (August 2011, U.S. Census for 2010 employment), one can see the horizontal lines the middle class lives between are moving vertically down instead of up. The idea is to have a thriving, constantly growing middle class and a relatively small portion of the population in poverty. Government gets itself involved in lots of wrongheaded things.

Example: there exists a wonderful product that helps drug addicts by eliminating cravings for heroin and other hard drugs. It was developed through government efforts, but it is primarily distributed by illegal drug dealers, in part because other forms of distribution run afoul of — you guessed it — federal laws. (Despite federal laws, estimates are that the cost of the war on drugs over the last 40 years is $1 trillion-plus and hundreds of thousands of lives, here and abroad. Since we are dealing with statistics, Web MD estimates that 22 million of us use illegal drugs. More use drugs here, per capita, than anywhere, even than in countries with liberal attitudes about drugs.)  

Another example: plug-in cars. Sales would indicate these are being made primarily for California, whether people want them or not. There is nothing wrong with plug-in hybrids, mind you, but I suspect most of us want to be able to drive 300 to 600 miles in a day, and Americans don’t seem to like trip limits of 60-90 miles. If a family has two cars, it makes sense that one might be a plug-in hybrid, but a hybrid with a back-up gas engine is a lot less expensive than a plug-in.

Whoever the new president is, he should probably make it easy for people to get back to work, build roads and reduce the size of government by attrition. (Making government smaller by firing people is a nonstarter in an age of high unemployment.)  Local and state governments are doing this automatically, in part because of high pension costs and lower tax revenues. And maybe the new president should get government out of the way, as per Milton Friedman, so that American free enterprise can get back to work.

As to wars: does anyone believe, once the U.S. leaves war-torn countries, democratic principles will rule? American business gets no kudos from me either. Imagine how nice it would have been if U.S. insurers had figured out, years ago, how to insure everyone before we got the Affordable Care Act? When government got into the act, trouble started, and the result may ultimately be as lame at the public health part (Peter Bedpan?) of the Olympic opening in London. According to what I read now, hospitals, entities that were hoping for getting out of the treating-people-for-free-in-exchange-for-tax-considerations business, are going to have an even tougher time with the new deal, and we may lose more. Ah, the unintended consequences of government meddling, right?

When the middle class shrinks and poverty grows, political government naturally turns toward the maximum number of voters.  The tilt needs to be reversed for the success of the country. If we don’t change the tilt, the country could drift into poverty and social unrest. We all need to get our heads on straight and work together. Now is the time for the common good and not so much the time to be white, black, Latino, poor, middle class or wealthy. This is the time to be American, to be a citizen of the United States. One word will make this country healthy again: Together!  

Stay cool and work for the candidate of your choice. And by “work,” I don’t mean e-mailing presidential birth rumors and Air Force One expenses (which are, after all, about the same for any president from any party) back and forth on the Internet, okay? It’s time to get serious for America.  

For more from Richard Hoe, see:

CEO Compensation Needs a Second Look

Confusion Reigns in PPACA’s Wake

Bad News


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