Drill, Baby, Drill!: Obama Administration to Announce New Energy Policy

According to several news sources, the Obama Administration will soon announce plans to allow drilling for natural gas and oil along massive stretches of the Atlantic coast, the Gulf of Mexico, and the northern Alaska coast. The policy will open many offshore areas to drilling that were previously subject to a 20-year moratorium enacted due to environmental concerns. The moratorium lapsed during the Bush Administration.

Reuters has more details:

The administration has been weighing the pros and cons of offshore drilling since it took office and put the brakes on a Bush-era proposal that called for drilling along the East Coast and off the coast of California.

For more than 20 years, drilling was banned in most offshore areas of the United States outside the Gulf of Mexico because of concerns spills could harm the environment.

Congress allowed the prohibition to expire in 2008 and former President George W. Bush lifted a drilling moratorium that year.

Environmental groups and some lawmakers continue to raise concerns about the impact increased drilling would have on coastal areas.

Although Obama indicated interest in drilling during the presidential campaign, both the New York Times and Reuters suggest that the new policy could represent an olive branch to the oil industry and moderate Democrats and Republicans ahead of the climate control legislation that he will soon promote.  But if the New York Times graphic outlining the newly approved drilling areas is correct, then environmentalists and coastal tourism companies (particularly in Florida) will have a lot to say about this move.

What Is Really In The Healthcare Reform Legislation

The recently passed healthcare reform legislation has caused a lot of dramatic debate and protest among voters.  It often seems, however, that many people (proponents and opponents) lack knowledge about the actual content of the legislation.

There are some useful summaries available for learning purposes, however.  In particular, I have recently discovered two helpful summaries of the legislation.

I received one summary (pdf) from a healthcare provider, who is also a reader of Dissenting Justice.  The Senate's Democratic Policy Committee authored the document, which describes in great detail the implementation timeline for the legislation. 

The other document was prepared by Eric Peterson, a lawyer at the prestigious firm Dorsey & Whitney, LLP.  As stated on the Dorsey & Whitney website, Peterson practices healthcare law, and he represents "hospital systems, physician practices, retail and internet pharmacies, insurers . . . other health care providers and payors," and "medical device and pharmaceutical manufacturers." 

Implementation Timeline: Reflecting the Patient Protection and Affordable Care Act and the Health Care and Education Reconcilliation Act (Democratic Policy Committee) (pdf)

Health Care Reform Is Here (Eric Peterson).

See also: 10 Ways Healthcare Reform Could Impact You

Ricky Martin (Finally) Comes Out

Ricky Martin -- the Puerto Rican singer of Living La Vida Loca and Menudo fame -- came out today. Although I suppose some people were surprised by the revelation, anyone with even elementary gaydar probably already knew.

Martin says he came out because he was tired of hiding and wanted to live an honest life.  Better late than never.  Kudos.

RNC Gives Donor $2,000 For "Meals" At Lesbian S&M Club

The Washington Post dropped a bombshell today after combing through the RNC's Federal Elections Commission filing.  Apparently, the RNC reimbursed a donor in the sum of $1,946.25 for "meals" at Voyeur West Hollywood.  Voyeur is a lesbian-bondage themed nightclub. 

The article also details lavish spending at posh hotels and the expensive use of a private jet. The article will undoubtedly result in greater scrutiny of RNC Chair Michael Steele. Steele has demanded that the donor return the funds.

The donor who received the reimbursement is Erik Brown. Brown lives in Orange, California. Brown has donated $10,000 to Republican candidates. No More Mister Nice Blog quotes a web-based bio for Brown, which has since been stripped of its content, as follows:

Erik is married to Alison Brown, a graduate of Chapman University and an MBA student at UCI’s Merage School of business.... A former director of the Sunday school, Alison and Erik reside in Las Flores, California and are actively involved in the ministries of their local church.

Interesting.

UPDATE: No More Mister Nice Blog has a screen capture of Brown's pre-scrubbed bio.

Say What??? Conservatives Complaining About the Elimination of Corporate Welfare Associated With Socialized Medicine

Now, I have heard everything. Conservatives are bascially complaining about the elimination of corporate welfare associated with a socialized medical plan (i.e., Medicare). Dissenting Justice detailed part of the story in an earlier post. Here is a brief summary.

The healthcare reforms have eliminated a double-benefit that corporations received if they paid for prescription costs of Medicare beneficiaries.  Under the old plan, the government subsidized 28% of the costs associated with the companies' drug expenditures, but companies also got to deduct the full amount of their expenditures -- including those covered by the 28% subsidy -- on their tax returns. Basically, companies received money from the government and were able to write off that same money as an expense -- rather than having to claim it as income or treat it as neutral.

The healthcare legislation does not eliminate the subsidy. The healthcare legislation does not make the subsidy taxable. Instead, the healthcare legislation simply disallows the corporate tax write-off for businesses that take advantage of the subsidy. In other words, companies can no longer deduct as a business expense the drug costs paid for by the federal government. Instead, they can only deduct their own share (or 72%) of those expenses.  The reform sounds quite reasonable -- except to conservatives.

Moved by dramatic press releases by corporations that will no longer get to double-dip, conservative media are fuming and using the corporate press releases to condemn the healthare legislation. Some conservative commentators have misrepresented the impact of the legislation, arguing that it eliminates the subsidy (which it does not do). Legal Insurrection, for example, asserts that "the chickens already are coming home to roost" as a result of healthcare reform and that the legislation causes the "cutback of subsidies for prescription drug benefit programs for retirees."  The Volokh Conspiracy similarly contends that the legislation forces companies to write-down substantial amounts of money because it enacts the "loss of a tax-free subsidy. . . ."

Conservatives are simply wrong on this issue.  Consider how two liberal rags, the Wall Street Journal and the Dallas Morning News, analyze the contested reform (yes - sarcasm).

The Wall Street Journal reports that:

Beginning in 2006, companies have received a 28% federal subsidy, up to $1,330 per retiree, tax-free, to help pay for prescription-drug coverage. Until now, companies could deduct the subsidy from their taxes, essentially getting a second benefit from the money. Under the new law, companies will no longer be able to deduct the subsidy, but it remains tax-free (emphasis added).

The Dallas Morning News offers a similar analysis:

Previously, companies could get tax-free subsidies to help pay for prescription drug coverage for retired workers and, on top of that, could deduct those subsidies from their total tax bill.

Under the new law, the original subsidies will still be tax-free, but the companies no longer will be allowed to deduct the subsidy from their total taxes (emphasis added).

My Take
It is unclear why -- outside of an utter lack of understanding or a desire to criticize anything associated with the healthcare legislation -- conservatives are rallying to defend the corporations. As numerous media outlets have reported, the legislation simply eliminates a double-benefit for corporations; it does not, however, repeal the subsidy or make it taxable. Accordingly, conservatives are effectively complaining that the federal government is getting rid of corporate welfare associated with socialized medicine (i.e., Medicare). That's a pretty difficult position to reconcile with conservative values.

The REAL Reason Companies Like AT&T Are Whining Over Healthcare Reform

Conservative media have been buzzing over recent press releases from companies like AT&T, Deere & Co., and Caterpillar, Inc., which claim that these business will lose millions or even up to $1 billion dollars as a result of healthcare reform. These reports, however, do not tell the full story.

The "losses" result from the elimination of a tax loophole that effectively operated as a double-subsidy for these (and many other) companies. Under the loophole, the government subsidized 28% of companies' expenditures on prescription drugs for Medicare beneficiaries. The government, however, allowed these same companies to deduct 100% of their expenditures on prescription drugs for Medicare beneficiaries -- including the 28% given to them by the government.  The new law eliminates this excessive incentive by capping the deduction at 72% (100% minus the 28% subsidy). The subsidies, however, remain tax-free, just as they were before the reform legislation was enacted.

The original law is analogous to a hypothetical situation where Congress gives people money to pay the interest on their mortgages, but then allows them to deduct their entire mortgage interest expenditures on their tax returns. As attractive as that scenario sounds to me as a homeowner, I recognize its excess.  The same setup for businesses is excessive, in my opinion.

I do realize, however, that the companies might ultimately shift these costs back to the government in subsequent years by reducing coverage of prescription drugs.  Ironically, given their criticism of the legislation, conservatives apparently want more expenses for the government and more handouts to companies.  This, however, is not a conservative value.

UPDATE: The Wall Street Journal reports an additional aspect of the subsidy structure that benefits companies. Companies can receive the subsidy to cover expenses for prescription drugs that retirees eventually pay. That "loophole" remains.

JUST ADDED: Say What??? Conservatives Complaining About the Elimination of Corporate Welfare Associated With Socialized Medicine

10 Ways Healthcare Reform Could Impact You

Several media outlets have reprinted an article on healthcare reform that originally appeared on Investopedia -- a Forbes digital company. The article details many of the benefits (and some costs) provided by the recently enacted healthcare legislation.

With so much negative propaganda floating around, the article is a refreshing read. Although it does not fully discuss the costs associated with the legislation, it informs readers what they have "bought." This is an important part of the discussion that neither the White House nor the opponents of the legislation has adequately addressed.

Here are some details:

1. Your Kids are Covered
Starting this year, if you have an adult child who cannot get health insurance from his or her employer and is to some degree dependent on you financially, your child can stay on your insurance policy until he or she is 26 years old. Currently, many insurance companies do not allow adult children to remain on their parents' plan once they reach 19 or leave school.

2. You Can't be Dropped
Starting this fall, your health insurance company will no longer be allowed to "drop" you (cancel your policy) if you get sick. In 2009, "rescission" was revealed to be a relatively common cost-cutting practice by several insurance companies. The practice proved to be common enough to spur several lawsuits; for example, in 2008 and 2009, California's largest insurers were made to pay out more than $19 million in fines for dropping policyholders who fell ill.

3. You Can't be Denied Insurance
Starting this year your child (or children) cannot be denied coverage simply because they have a pre-existing health condition. Health insurance companies will also be barred from denying adults applying for coverage if they have a pre-existing condition, but not until 2014.

4. You Can Spend What You Need to
Prior to the new law, health insurance companies set a maximum limit on the monetary amount of benefits that a policyholder could receive. This meant that those who developed expensive or long-lasting medical conditions could run out of coverage. Starting this year, companies will be barred from instituting caps on coverage. . . .

7. You'll Have More Options
Starting in 2014 (when you will be required by law to have health insurance), states will operate new insurance marketplaces - called "exchanges" - that will provide you with more options for buying an individual policy if you can't get, or afford, insurance from your workplace and you earn too much income to qualify for Medicaid. In addition, millions of low- and middle-income families (earning up to $88,200 annually) will be able to qualify for financial assistance from the federal government to purchase insurance through their state exchange.

The full article is available here: 10 Ways The New Healthcare Bill May Affect You.