Monday, May 24, 2010

Gingrich Speaks

If a guy writes a book entitled "To Save America: Stopping Obama's Secular-Socialist Machine," you know three things: he has a mighty high opinion of himself, convinced that he can "save America;" he has a fairly low opinion of America (which he believes needs saving); and he's not going to make much sense.

Any Republican with national ambitions nowadays must raise the canard of socialism, and Newt does not disappoint. On May 17, 2010 he gave an interview to Five Thirty Eight's Tom Schaller and was classic Newt, claiming at one point

They just nationalized the student loan program. They designed Obamacare so there’s a backdoor road to socialized medicine because it creates an incentive for companies to drop their employees. There’s evidence that hundreds of companies may drop millions of employees from their health insurance and have them go buy individual insurance. So there’s a lot of different practices that would lead us to believe this is socialist operation.

The reform of the student loan program Gingrich criticizes, as The New York Times reported, "substitutes an expanded direct-lending program by the government for the bank-based program, directing $36 billion over 10 years to Pell grants, for students from low-income families." Socialism triumphant? Maybe not, given that

Although private banks will no longer be allowed to make student loans with federal money, many will continue to earn income by servicing those loans.

Saving the taxpayers $61 billion (much of which will be plowed back into student loans) over ten years is not too popular with Republicans these days. Or maybe because the student loan program fit the GOP's ideal of free enterprise, inasmuch as

Since the bank-based loan program began in 1965, commercial banks like Sallie Mae and Nelnet have received guaranteed federal subsidies to lend money to students, with the government assuming nearly all the risk. Democrats have long denounced the program, saying it fattened the bottom line for banks at the expense of students and taxpayers.

“Why are we paying people to lend the government’s money and then the government guarantees the loan and the government takes back the loan?” said Representative George Miller, Democrat of California and chairman of the Education and Labor Committee.

Good work if you can get it- banks make the profit while the federal government accepts the consequences when there is a default. And every single Republican in the United States Congress voted to maintain this set-up. It's nice to have one of the major political parties snap to attention when your profits are threatened.

But if Gingrich's view of the student loan program runs contrary to the interests of the working and middle classes, his reasoning on health care is, well, convoluted. "Hundreds of companies may drop millions of employees from their health insurance and have them go buy individual insurance," thus pointing the way toward socialism, Newt says.

Just think a moment about this. Newt fears that individuals will lose employee-provided health insurance (certainly an unfortunate event)- for which group rates are obtained- and be exposed to.... the free market. And to Newt Gingrich, the free market is a..... "socialist operation?" explains:

Employers could still drop coverage under the bill — just as they can now — and, in fact, the CBO estimates that some would. Under the Senate bill, the CBO said that 8 million to 9 million people who would be expected to have employer-sponsored insurance under current law wouldn’t be offered such benefits by 2019. These would mainly be low-income workers, CBO said, who would be eligible for subsidies to buy their own plans. Others would gain coverage through their jobs under the bill, resulting in a net decrease of 4 million people on employer-sponsored insurance.

Some employers will drop their health care coverage, at which point employees would be required to buy their own health insurance in the private market- with help from the federal government, which should help keep prices, and profits, high for private insurers. And that would be a.... "socialist operation?"

With a bias in favor of huge financial institutions and against the middle class, as well as seriously distorted reasoning, this man is a serious threat to be the next GOP presidential nominee.

1 comment:

Dan said...

i want a secular-socialism machine. it sounds like fun

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