Uncertainty is the enemy of economic growth. When a person is less sure about the future, that person is less likely to make an investment. Investments are, after all, a kind of bet on what the near term future will bring. A factory owner who buys new equipment is wagering that the products he will create will be able to be sold once the new plant goes into operation. That same factory owner is also betting that he will be able to find employees to operate the equipment at a reasonable price. He is also gambling that he will be able to get the needed raw materials and that he will be able to sell the output at a profit. If any of these factors become less certain in the view of the investor, he will be less likely to make that investment.
In view of the negative effect that uncertainty has on investment, it ought to be one of the prime goals of government to reduce uncertainty in the economy (or at least not to increase it.) Sadly, under president Obama, the federal government has been injecting more and more uncertainty into the economy, and the result has been slower economic growth and reduced investment. Remember investment is the principal driver of growth in our economy. Without investment, there is, at best, economic stagnation.
It is worth looking at the economic effect of Obamacare over the last three years since the bill was passed. For a long time, people were just worried about how the law would hit the economy. Things were uncertain and it hurt growth. Now, however, we have reached the point where reality should be replacing uncertainty. Sadly, we are getting a terrible reality and even more uncertainty. This morning I was told about a staff meeting earlier this week at the local hospital. The hospital is part of the premier system in this state (Yale) and is a first rate facility. The director began the meeting by telling the staff that he knew that they all had questions about what Obamacare insurance changes would mean for the hospital once the first of the year came. The director then told the assembled doctors that no one actually knew what the effect would be. He also told them that the Trustees of the hospital had just gotten notice that their insurance plan was being cancelled since it was non-compliant with the Obamacare requirements. Think about that! Are we to believe that the trustees of this hospital had a sub-par plan, the favorite description from Obama of the cancelled plans? No way! The point here is that one month before things change on the first of the year, there is still complete uncertainty in the medical community about how Obamacare is going to hit the system.
The failure here is not just that the law was not thought out before it was passed. The truth is that even once the law was passed, no one in Washington seems to have cared enough to take the steps necessary to clear the path for the roll out. They are flying by the seat of their pants in Obamaland. The uncertainty is hitting people all across America. It make take a few months to show up in the statistics, but we are all going to pay the price for this idiocy.
In view of the negative effect that uncertainty has on investment, it ought to be one of the prime goals of government to reduce uncertainty in the economy (or at least not to increase it.) Sadly, under president Obama, the federal government has been injecting more and more uncertainty into the economy, and the result has been slower economic growth and reduced investment. Remember investment is the principal driver of growth in our economy. Without investment, there is, at best, economic stagnation.
It is worth looking at the economic effect of Obamacare over the last three years since the bill was passed. For a long time, people were just worried about how the law would hit the economy. Things were uncertain and it hurt growth. Now, however, we have reached the point where reality should be replacing uncertainty. Sadly, we are getting a terrible reality and even more uncertainty. This morning I was told about a staff meeting earlier this week at the local hospital. The hospital is part of the premier system in this state (Yale) and is a first rate facility. The director began the meeting by telling the staff that he knew that they all had questions about what Obamacare insurance changes would mean for the hospital once the first of the year came. The director then told the assembled doctors that no one actually knew what the effect would be. He also told them that the Trustees of the hospital had just gotten notice that their insurance plan was being cancelled since it was non-compliant with the Obamacare requirements. Think about that! Are we to believe that the trustees of this hospital had a sub-par plan, the favorite description from Obama of the cancelled plans? No way! The point here is that one month before things change on the first of the year, there is still complete uncertainty in the medical community about how Obamacare is going to hit the system.
The failure here is not just that the law was not thought out before it was passed. The truth is that even once the law was passed, no one in Washington seems to have cared enough to take the steps necessary to clear the path for the roll out. They are flying by the seat of their pants in Obamaland. The uncertainty is hitting people all across America. It make take a few months to show up in the statistics, but we are all going to pay the price for this idiocy.
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