The public radio station in New York City, WNYC, has launched a series about the upcoming presidential election called The United States of Anxiety. It’s a great and accurate name. I plan to check out the podcast, since I’m hardly anxious enough about the puncher’s chance a classically entitled sphincter-mouthed bully has of becoming the job-creating reality TV show president of these United States.
I have deliberately avoided this distasteful and aggravating subject here, and am not going to the obvious rant, er, screed. Stay with me a moment. I’m about to tell you why Americans are right to be mad as hell, on every side.
People are angry. Millions and millions of people are angry. They are not wrong to feel angry. Across the globe, people are being screwed, en masse, by the billions. To my American friends, just make a call to most customer service numbers, spend a few minutes trying to resolve a simple mistake on your bill, you will get a wee taste of this non-consensual, but mandatory, screwing.
There are millions, if not billions, of people too weak to feel angry, because they are starving to death and their babies are dying from shit-borne diseases in areas with no sanitation and no clean water. Or they are too terrified to give vent to anger, fleeing from bombs and savage rag tag armies. Let’s leave these unfortunates aside for the moment. I’m talking about angry people who have homes, incomes, cars, friends, all the trappings of what should be a good American life.
What are they so angry about? The American Dream that is constantly being advertised turned out to be bullshit for most of them. Work hard, save your money, send your kids to a good college, enjoy a golden retirement. The American Dream, if it ever existed on a widespread level (it seems to have for a couple of decades after the Second World War when many rose out of poverty into the middle class), is attainable by an ever smaller group today. The odds of a person born in poverty in America today getting out of it are about the same as the odds of that person winning Powerball.
It remains a great country for the wealthy, and the stock market is humming along for the investor class, but it’s a challenging, difficult, anxious time of economic decline for everybody else. The poor and disabled get by on small government subsidies, rather niggardly subsidies, actually, if you look at the numbers. The rich see their taxes lowered and in many cases pay little or none on vast fortunes (see example below). The tens of millions in the middle, who have seen no improvement in their situation, are feeling squeezed and hopeless, betrayed by their corrupt, dysfunctional government. Angry, and not unreasonably so. They are being screwed.
It is impossible to deny this basic screwing, though wealthy candidates and liberal celebrities tend to point at the healthy stock market, and the relatively low unemployment numbers, as proof that America’s doing great. Another wealthy candidate assures his supporters that they are right to feel every drop of the hatred they do, that they are, without a doubt, being mercilessly screwed and that he’s got a noose for every person who is screwing them.
You can no longer live by being frugal and keeping whatever you save in a bank here in America, as people did in past generations to put aside a small nest egg. You lose money in a bank, year after year, might as well keep the bills in your mattress as at the 0.1% interest rate banks pay. The bank will also charge you a monthly fee, in most cases, if you have less than a certain amount on deposit. Usually that amount is far in excess of what a poor person has on hand. When I was a boy you could start a bank account for $5, and there were no fees. They sent you calendars and gave out pocket organizers and pens. I got my first crock pot as a gift from a bank when I opened a checking account.
The only people who are making any money on their savings are investors. Investors are doing very well in this climate, created and perpetuated by the gigantic and lucrative financial industry, breaking its own fabulous record for profits and bonuses, year after year.
The smartest government regulators charged with stopping fraud in this wildly lucrative industry step through a one-way revolving door and go on to seven and eight digit compensation packets in the industry, if they play their cards right. The beauty is, whatever fraud is committed, it is extremely complex, done in-house and nobody ever needs to admit actual wrong doing. They play with house money, always.
Let’s look at money, earned income versus inherited wealth. If you inherit $1,000,000 you pay no federal tax (only estates starting at $10,900,000 per couple are taxed). Many states have no inheritance tax either on an estate of this size. Forget what you hear about the dreaded Death Tax, it doesn’t apply to the vast majority of estates.
Your inherited million, if invested, as an inherited million generally will be, makes between 5 and 10 percent a year, some years more. You can take $50,000 in the average mediocre year, most of it tax free, without touching the original principal.
Let’s get the calculator. The million dollar inherited portfolio, at a 5% annual rate of growth, will be worth $1,275,692 at the end of five years, if left alone (a small piece of this increase will be taxable as ‘capital gains’). That means that in year five you can begin taking interest of $64,000 a year — and still have around $250,000 more than you had when you got the cool million (once you adjust for taxes on capital gains made by whatever moves the fund manager may have made, which your advisor will advise you about).
For purposes of this 5% illustration, you will get a hypothetical 28% annual raise, $14,000 a year, over the initial annual interest of $50,000, just by doing absolutely nothing with that cool million for five years. Money makes money, yo.
A million, of course, is considered chump change by the real players. Except maybe to someone who wouldn’t mind living off the interest while they try to launch an educational non-profit, write a book, learn to play the cello, fuck off on top of a mountain. Some make do on a fraction of that.
A billion is the new price of admission to the locker room, where you can grab women by whatever you want, if you are so disposed, since– whatever it costs, my accountants will write a fucking check, and my lawyers will slap a gag order on you if you take the dough, OK bitch face?
A billion is a number so large it’s almost impossible to imagine. Let’s take a more manageable ten million dollars, just eight digits, starting with a 1. Can you live on $400,000 to $500,000 interest a year? I know I could.
Then there are the health insurance companies, pharmaceutical companies, cash-strapped hospitals and high tech diagnostics, what we now call the Health Care sector. You can invest in this sector, it does very well, as they say.
The Patient Protection and Affordable Care Act (“ACA”), whose primary authors are all back working lucrative gigs for the health insurance and pharmaceutical industries, while it has extended medical coverage to many previously shit out of luck, has many bad bugs in it.
In many cases the ACA makes health care more affordable, but there is little by way of patient protection.
Here’s a serious bug: nobody can tell you the price for any medical service until after you receive the service. This may have always been the state of American health care insurance, but it is a very sad state not to have been addressed in a law called the Patient Protection and Affordable Care Act.
The name comes off as a little cynical if you consider that the American Health Care marketplace is the only store where you buy something nobody can tell you the price of until weeks after you bought the thing. Refunds are not allowed, you owe whatever the bill says.
The insurance company informs you that, sadly, they can’t tell you the price for anything until they are billed by the provider. The provider, unfortunately, can’t tell you a price until they find out how much the insurer will pay.
There is no requirement in the law, as written, (and a determined opposition continues to call for its repeal instead of helping to fix its many faults), for the consumer to be informed of the price of any service prior to buying the service.
You will get a bill for $1,324 dollars for a fully covered sonogram, and a second bill, if you don’t pay the first, and then a letter from a debt collector if you still refuse to pay. It is the patient’s responsibility, you signed a paper to this effect before the procedure was done, it’s ironclad. Either straighten it out with a series of calls, letters and faxes, or get lawyer’s letters demanding the payment of $1,324.
I get those letters periodically from some law firm specialized in debt collection, for a non-negotiable $327 blood test an incompetent physician’s assistant once had me take, “just in case”, a couple of years back.
So, yes, Obama did a great thing by making insurance companies give up that “pre-existing condition” loophole, something right out of the Nazi accounting book. In return, he delivered to those same hungry insurance companies millions of new, mandated, customers. The solvency and ongoing massive profitability of the whole plan depends on all eligible uninsured Americans buying insurance.
The premiums of the young and healthy, who as a group don’t need much medical care, will subsidize the costly care millions of older Americans with diabetes, cancer, chronic heart disease, morbid obesity, require. Most of these illnesses were, until Obamacare, considered pre-existing conditions traditionally banned from medical insurance coverage.
Of course, nobody is allowed to talk about the $25,000,000 annual compensation of the C.E.O.s of these private insurance corporations and the culture of profit before product they represent.
“Kind of hitting below the belt, isn’t it, old boy? What are you, a damned Red? Now be a good fellow and fetch me and my lady friends a round of Old Fashioneds, would you? Off with you now, chop chop.”