Cerberus Going Down: The Hedge Fund, Not the Three Headed Dog

Cerberus Caught By Surprise

Cerberus Capital Management has been swamped with redemption requests with the Wall Street Journal reporting that investors are asking to pull out $5.5 billion or 71 percent of assets from its hedge funds.

Cerberus, founded in 1992 by former Drexel Burnham Lambert Inc. banker Stephen Feinberg, stayed out of the limelight as it focused on buying troubled companies, debt and real estate. It stumbled with its two highest-profile deals: leading separate groups that invested almost $15 billion combined for controlling stakes in automaker Chrysler and GMAC, the former finance arm of General Motors Co.

The firm wrote off the majority of its Chrysler stake as the Auburn Hills, Michigan-based company headed into a U.S. government-orchestrated bankruptcy. Its stake in GMAC was diluted when the Detroit-based lender was bailed out by the U.S. and converted into a bank holding company. They were rare mistakes for Feinberg, 49, whose firm has generated average annual returns of about 20 percent since its inception, according to Neporent.

Hedge funds run by Cerberus Capital Management LP are experiencing massive capital drains as investors flee en masse in the wake of the group’s losing multi-billion dollar bet on the U.S. auto industry, according to a media report Sunday.

Clients are pulling more than $5.5 billion — nearly 71% of the hedge fund’s assets — in response to losses and their own need for cash, The Wall Street Journal reported in its online edition, citing unnamed sources. The redemptions came mostly from other managers who need to pay off investors, according to Mark Neporent, the New York-based firm’s chief operating officer and general counsel.

In a letter to clients late last week, Cerberus Chief Executive Stephen Feinberg and co-founder William Richter wrote that they “have been surprised by this response.”

“We are embarrassed and disappointed by our 2008 performance, and we feel a huge obligation to you to turn this around,” Feinberg wrote in a July 3 letter to clients.

Cerberus asked clients of the funds that suspended redemptions in July whether they wanted to continue their investment with a lower fee. Those who wanted to withdraw would have to wait for assets to be liquidated before getting back all their money, a process that could take as long as four years.

In the nine months ended June 30, investors yanked $300 billion from hedge funds, leading to a sharp decline in an industry that had grown to hold about $1.9 trillion in assets in 2007, according to Hedge Fund Research.

Among the other big-name funds in trouble are ones run by Atticus Capital LP, Pequot Capital Management and Cantillon Capital Management, the Journal said.

The once-high-flying funds got in deep trouble with unwise investments, especially stakes in Chrysler and GMAC as the U.S. auto industry founders in the face of the global economic downturn. Those investments were wiped out when Chrysler declared bankruptcy and GMAC was bailed out by Uncle Sam, The Journal pointed out, and Cerberus was forced to give up control of the latter company.

As if leaving well enough alone weren’t enough for the hedge fund, Cerberus Capital Management LP plans to raise money in the fourth quarter to buy distressed companies and securities. “Institutions and wealthy individuals are still looking to invest with Cerberus, which oversees $24.3 billion, including a $1 billion fund raised last month,” Mark Neporent said.

– Reuters

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Disney to Take Over Marvel in a $4 Billion Deal

Disney Buys Marvel

Walt Disney Co. President and CEO Robert Iger called “a great opportunity at the right time,” Disney is buying Marvel Entertainment Inc. in a $4 billion cash-and-stock deal.

The deal would plug a hole in the Disney line-up, rounding out the company’s stable of girl-focused characters: ”Hannah Montana,” ”High School Musical” and ”Wizards of Waverly Place.”

The acquisition comes as Disney, with its vast theme park operations and television advertising business, has been struggling because soft advertising sales at ABC and ESPN and drooping consumer spending at Disney World. Disney’s profit in the third quarter dropped 26 percent.

Over all, Disney’s net income fell to $954 million, or 51 cents a share, from $1.28 billion, or 66 cents a share, in the year-ago period. Revenue fell 7 percent, to $8.6 billion. Earnings per share for the current quarter included a one-cent restructuring charge related to an accounting gain. Excluding that charge, Disney narrowly beat Wall Street’s expectations.

Under the terms of the deal, Marvel shareholders will receive $30 cash and 0.745 shares of Disney stock (NYSE: DIS) for every share of Marvel stock (NYSE: MVL) owned. That values each Marvel share at $50 based on Friday’s, August 28, closing stock price for Disney.

At closing, the amount of cash and stock might be adjusted such that the total value of the Disney stock issued is not less than 40 percent of the total merger consideration, based on its trading value at that time.

Both boards of directors have approved the deal, which is slated to close by the end of the year.

Shareholders at Marvel will need to approve the transaction.

On a conference call with investors, Disney said that the deal will be accretive to earnings in two years.

Disney also said that the deal will result in the issuing of 59 million new shares, but Disney would enter a buyback program to repurchase the same amount of shares during the next 12 months, as to not dilute stockholder value.

The deal gives Disney ownership of Marvel’s portfolio of more than 5,000 characters, which include such iconic characters such as Spider-Man, The Incredible Hulk, the Fantastic Four and the X-Men, many of which have been turned into successful movie franchises in recent years.

Current Marvel Licenses Still Upheld

Disney will continue to honor the distribution deals in place for Marvel films, such as Paramount Pictures’ deal for the “Iron Man” franchise, for the duration of the agreement.

“This transaction combines Marvel’s strong global brand and world-renowned library of characters including Iron Man, Spider-Man, X-Men, Captain America, Fantastic Four and Thor with Disney’s creative skills, unparalleled global portfolio of entertainment properties, and a business structure that maximizes the value of creative properties across multiple platforms and territories,” said Robert A. Iger, President and Chief Executive Officer of The Walt Disney Company. “Ike Perlmutter and his team have done an impressive job of nurturing these properties and have created significant value. We are pleased to bring this talent and these great assets to Disney.”

“We believe that adding Marvel to Disney’s unique portfolio of brands provides significant opportunities for long-term growth and value creation,” Iger said.

Ike Perlmutter to Make a Fortune in Disney Deal

Marvel Chief Executive Officer Ike Perlmutter will oversee the Marvel properties. Disney’s officers on the investor call reiterated that Disney is not looking to gut the company, or slap Disney’s name on Marvel’s products.

“The goal here is not to rebrand Marvel as Disney,” Iger said.

“Disney is the perfect home for Marvel’s fantastic library of characters given its proven ability to expand content creation and licensing businesses,” said Ike Perlmutter, Marvel’s Chief Executive Officer. “This is an unparalleled opportunity for Marvel to build upon its vibrant brand and character properties by accessing Disney’s tremendous global organization and infrastructure around the world.”

Marvel Entertainment began in 1939 as a comic book company called Timely Publications. It has since become one of the largest character-based franchises in the world, with a proprietary library of over 5,000 characters including The Incredible Hulk, Captain America, The Avengers and the X-Men.

Ronald O. Perelman acquired Marvel in 1989, but the company filed for bankruptcy protection seven years later, setting off a drawn-out takeover feud between him and a group of bondholders led by Carl C. Icahn. In the end, Mr. Perlmutter gained control of Marvel through his company, Toy Biz, and Mr. Perlmutter owns about 37 percent of Marvel’s stock, according to Marvel’s latest annual filing with regulators.

Marvel now has three main divisions: a licensing arm, which sells the right for other companies to use their proprietary characters in movies and promotions; a publishing arm, which makes the comics and books based on their characters; and a film production unit, which makes movies for some of their characters.

The film production unit is a relatively new venture for Marvel. The company originally licensed its characters to the big movie studios, but beginning in 2005, Marvel entered the movie-making business with the construction of a $525 million film facility.

Perlmutter will bring in a handsome payday from the deal. According to Marvel’s last DEF 14A statement with the U.S. Securities and Exchange Commission, which was filed March 24, Perlmutter is Marvel’s largest shareholder, controlling more than 29 million shares, or 37.21 percent of the company, through direct ownership, stock options and trusts.

Perlmutter’s stake will bring in about $881 million in cash after the close of the deal, as well as 21.878 million shares of Disney stock, which based on Friday’s closing price of $26.84, would be worth some $587.2 million.

Disney said the acquisition will hurt its earnings per share by a mid-single digit percentage in fiscal 2010. They expect the impact to be positive by the time 2012 rolls around, fueled in part, they said, by 59 million new shares and also by a number of new Marvel Comics-based movies: “Iron Man 2,” “Spider-Man 4,” “X-Men Origins: Magneto,” “X-Men Origins: Wolverine 2″, “Thor” and “The First Avenger: Captain America.”

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Are Gays really Seeking Equality in "Marriage"?

due to gay outcry I have been forced to take this story down that presents legal arguments FOR and against gay marriage down.

Regardless of  the actual content of the article, apparently just mentioning gay is now grounds for lawsuit and corporate backlash.

China’s Economy Booming: The Biggest Liar

Don’t Believe the Hype: Why Chinese Economic Reports are False

All the buzz now are the official numbers coming out of China. The economy is booming and will hit an astounding economic growth target of 8%. Its GDP growth spiked to 7.9% up from 6.1% in the first quarter. These last two quarters promise a possible even high growth rate. Of course in the global economy China is nearly the only one growing.

However, these figure are the “official” numbers out of China. Official figures don’t always tell the true story. Also an economic recovery there might be a double dip instead of a V shape. Everyone is reporting that there is a strong possibility that China’s economy will slip back down after their stimulus erodes. The official figures did not even include the private sector employed. That’s some 60% of the population not covered by official numbers.

China still needs to create 12 million new jobs and the stimulus did not offset the complete impact of the financial crisis.

Figures are also coming out that the stimulus was wasted by speculation: this is evidenced by stock price spikes and real estate explosions. Like America this is simply creating a bubble. When the smoke clears the banks will once again be sitting on a big bubble of bad debt, which is counter productive to bringing the economy forward.

What is known about the official figures is that that same 7.1% GDP growth included a staggering 6.2% state-directed investment. The second quarter saw no change. They are concerned that consumer spending will remain tight through the last two quarters and the state coffers will be emptied.

CNBC the Worst Source for News

These are the facts. The numbers are real. It’s people like Maria Bartiromo that report just completely false information that makes me angry. She reports China’s Economy is Booming. What is her learned conclusion? She reports that the stimulus package reached the common Chinese man. According to all my sources, the stimulus package there was virtually the same as it was here: it was given to the rich and higher ups. It never reached the common man at all. But she, like most on that horrible channel, didn’t bother to do any research or worse went with the official story.

If you actually listen to CNBC or worse, make your investment decisions based off of a t.v. program then you are the moron. I may blame CNBC for trying to come across as financial journalist, but I carry a bigger stick for boobs that listen to them [pun intended].

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Bigger Government Smaller Citizens

The Story of the Government

There were 5 brothers. They all lived with their father and had no mother, since she died shortly after giving birth to the last child.

There was a fat brother. He was a middle child, and if you know anything about middle children, he took no guff from anyone, because middle children are left to fend for themselves by parents. He was fat and large, larger even than the eldest brother. No one ever got in his way, but he didn’t much bother with the other boys. He had a bad habit however of sleeping all the god damn time. I annoyed the younger boys to no end, because he was their protector against the older boys. However, the older boys knew if they gave the fat one sweets, he’d fall asleep 30 minutes later. The older boys were in charge of the allowance money so they always bought sweets for the fat one, just to keep him in a coma all the time. They wanted to watch something the fat one didn’t – they fed him sweets. And, he could sleep through a hurricane.

The two older boys were no good. And they were always up to no good against the two younger boys. There was an evil older boy, he was the 2nd to the oldest. And, there was the eldest. He wasn’t evil per se, but he was always conniving of how to rule over all the boys, even to the point of going against the fathers wishes and constantly breaking his rules.

The two younger boys never had a chance. There was the 2nd to the last who always thought something fishy was going on, but he was too young to put two and two together. Then, finally, there was the youngest and they gave him hell.

The biggest thing they argued over was the car. The father left on business trips and would be gone for two whole weeks at a time. When he remembered to, he’d ask his brother, their uncle, to check in on the boys. The two older boys knew exactly: when the father would leave; how long he’d be gone; and exactly when he’d return. The two younger boys were so young, they had no concept of time, in real terms. They understood tomorrow and today and that’s about it.

How this all started was by accident. The youngest boy was hungry one day and asked the eldest to cook. The eldest was busy playing a video game and got angry and told him to take the car and go get burger king. The youngest, at least knew that the father would never allow this. The eldest, feeling all powerful said he was the eldest and what he said goes. So, the youngest hopped in the car, drove to burger king and got food.

When the second to the youngest came home and found burger king he thought something was wrong with the picture. However, the youngest was grinning ear to ear and eating, and brought enough food for everyone to eat. Even the fat brother woke up and ate. Had he thought about it, he would have known something was wrong, but he was so dazed from just waking up and the food just made him go back to sleep.

Well, the next time the father left, the same scenario happened. However, the eldest knew that if the youngest got caught, it would mean big trouble. Mind you, the youngest was a tall kid of about 5 ft, so no one would suspect anything if they dressed him up. And, that’s exactly what they did. They dressed up the youngest and he went to buy food everyday through the drive-through.

The evil brother thought they had been getting a free ride for long enough. He started exerting his authority over the youngest. He had him serving him hand and foot. And, he threatened that if he was ever mad at serving him he’d tell the eldest to stop letting him go get food. He told him that the father gave both of the eldest money and that without his money there would be no food, so even if the eldest gave him money, there still wouldn’t be enough to last more than a day.

Any time the uncle came to check on them, he never noticed anything odd. But, then again, he never asked any questions. All he really cared about was whether the house had burned down and that everyone alive and healthy, at least to his eyes.

Well one week the father came home and the youngest was fat and sick in bed. The father didn’t think to ask why he was fat all of a sudden, but he trusted the eldest to take care of him. The eldest assured him he’d take care of him being sick. He had even called a doctor.

The father was so relieved he had such a dependable son. But, the father never noticed that the 2nd to last was never around when he came home. He was always told that he was over a friends house that the eldest knew and had met and approved of.

In reality, the 2nd to the last son, the honest one, had finally figured out what was going on. He was mad that the eldest would disobey his father and he was afraid that the youngest would get thrown in jail or worse kill himself driving the car. Anytime he came home though, the eldest would call one of the youngest boy’s friends and tell them to invite him over to spend the night. This went on for months. Finally, when he did come home he was so exhausted that he slept as much as the fat brother. In fact the honest brother and the fat brother were kept apart at every turn.

I wrote this story to illustrate how the U.S. government is acting, and has been acting. If you can figure it out, you’re way ahead of the game. For those who can’t figure it out I’ll explain it in detail.

1. the father is the constitution
2. the uncle is the supreme court
3. the eldest brother is the legislature/executive branch
4. the 2nd eldest is big business: oil / banking / organized crime / pharmaceuticals
5. all 3 younger brothers are the U.S. citizens
a. the fat brother are the middle class
b. the 2nd to last are the conspiracy theorist and constitutionalist i.e. Libertarians
c. the youngest are the poor

I bet you’re surprised by number 5. This is exactly how it is. The middle class outnumber everyone else. But, although they have some of the most educated of the population among them, they still can’t see what’s right in front of their face. They are the sleeping giant. If they ever woke up, there would be hell to pay. However, they are constantly struggling to get into the number 2 position, of big business.

The conspiracy theorist, who are generally written off as quacks actually know what’s going on, but try as they might, the middle class won’t listen to them, or the media quiets them down so much that the middle class never get a chance to hear them.

The libertarians are also written off as quacks, or are squelched as much as the conspiracy theorists. While the libertarians are screaming constitution constitution, the middle class doesn’t hear them. The libertarians say: “show me in the constitution where the government has the authority to pass a welfare act.” The middle class simply assumes that since it’s already there, it must be right, i.e. the fat kid woke up and ate the burger king, no questions asked. I’ve heard people say, I’m against welfare and these socialistic programs, but by god, I lost my job, thank god they’re there. It’s the fat kid eating the burgers in a daze. He knows something is wrong, but he eats the burgers anyway.

Now the youngest was the poor. The poor know they shouldn’t be getting a free ride. The poor know they are taking money out of the pockets of millions of hard working people, but they don’t remember “that the eldest can cook at home.” That’s right, if the eldest did what the father said “the constitution”, no one would be in trouble to begin with. Everyone is deathly afriad to let go of the social programs. In fact they are so afraid that they say stuff like “are you saying you want my grandmother to die, if you removed medicare?” They actually think that without welfare and medicare and medicaid and these prescription drug programs, that people would all shrivel up and die.

In fact, the middle class thinks this as well. it is only the 2nd to the last brother that even realizes there was a time when there were no welfare, medicare, medicare, prescription drug, farm subsidy programs. And, the government was tiny and didn’t collect any taxes. Only the 2nd to the last brother remembers this.

Only the 2nd to the last brother remembers that donations to charitable organizations were through the roof way back when, and everyone was taken care of.

Only the 2nd to the last brother remembers that there were “homes” everywhere, for everyone: the poor; orphans; unwed mothers; the mentally ill; the elderly. Everyone had a place to go and nearly no one was on the street. In fact social security didn’t even cover workers comp and the mentally ill until the past 20 – 25 years. So all those people were taken care of by somoene else too. And, that’s recent history. That’s not no 80 years ago.

Only the 2nd to the last brother remembers that only rich people had insurance for medical conditions. The middle class and the poor just went to the doctor and paid out of their pocket, or paid nothing because the doctor could afford to treat people for free.

Only the 2nd to the last brother remembers doctors making house calls, as the normal thing to do. Because back then general practitioners made a decent living and didn’t have ridiculous medical school loans to pay off, due to the government getting involved in guaranteeing student loans and allowing schools to jack up the prices every year for the past 50 years.

If you buy into the lies that the news tells you, you’ll be just like the last brother. The government goes against the constitution and you’re are in cahoots with it. If there was a body of government who penalized people for breaking the constitution, but the government would go to jail, and you’d go too for accepting the hand outs. It’s just like buying stolen goods, you both go to jail.

There is a complete different option than what exists today. We don’t need welfare. We don’t need medicare. We don’t need state run schools. We don’t need farm subsidies. We don’t need prescription medication subsidies. We don’t need.. *gasp* oil subsidies. [is that crazy? the oil companies need a hand out every year? who thought that one up?] And, you don’t need to pay taxes for all of these things. You don’t need to pay mandatory insurance.

In fact if you got rid of all the insurance you pay – medical / home / car – how much more money would you keep each paycheck? How much money would you keep in your pocket if we got rid of all of these social programs? Recently there were these bailouts and they gave and exact figure for how much each American would be paying in taxes to pay for the bailout – $3,000. Now imagine if you would, that each of these programs, that we currently have, was eliminated. Currently they each carry a price tag similar to the bailouts. So you would be saving about $3,000 a year by eliminating each program. So that’s: welfare – $3,000; medicare – $3,000; medicaid – $3,000; Corn subsidies – $3,000; Social Security – $3,000. So that’s $15,000 a year you’d be saving from the top social programs. Add in insurance – the median is more like $5,000 and that’s a cool $20,000 a year… yes PER YEAR, you’d be saving and actually making.

Don’t brush off that number like it’s unrealistic. Remember we didn’t have those programs before. In fact people didn’t pay taxes either. So had we continued in that vein, the national median household income, in today’s dollars when you account for the income 90 years ago, should be about $70,000 a year. Does that seem crazy to you? It’s simple math. Take what the national house hold income was in the 1920’s and bring it forward to 2010. I guarantee you it’d be $70,000. But you’re making, on the median, $50,000. That’s household, everyone in your house, together.

With that in mind, now when you go to the polls, when you go to town hall meetings, when you watch the news, realize there is another choice. And, vote according to what is right and just, not just by the constitution, but by what’s right and just for you personally. I don’t think anyone would want to pass up an extra $20,000 a year. I could care less what your politics is. And, if you are one of the rare few idiots that want to give away your money, that’s fine, but do right by your poor broke neighbor and don’t let them take away HIS $20,000 a year. If you want to give your away, that’s your personal option, but fight for your option to do that, don’t fight for the government’s option to take everyone’s away.

Remember, some people have different situations.

I had a guy tell me he’d prefer the government take the money and take care of the poor. What he failed to realize is that when the government takes, it takes away from the people who desperately need that money, like people taking care of a sick parent; or people taking care of a crippled child; or people who take care of abandoned nieces and nephews. So because he felt generous, he turns around and breaks half of the families in his neighborhood, who’s situations he didn’t know, or even care about, apparently.

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In Plain English: Single Payer Health Insurance

Single Payer Health Insurance

There is a huge debate raging over health care and health care reform. People throw around terms that no everyone knows. Namely, because most Americans are not sick and don’t deal with the medical community on a daily basis. Today I’d like to discuss one of the terms being thrown around: Single Payer Health Insurance.

The president and all members of the legislature all have single payer health insurance already. And, they’ve had it for years and years.

I’m not one to mince words, and I like to keep everything in perspective. I am by no means a bleeding heart and seek ultimately that no one pays taxes. Our government was not put in place to run our lives and does not need trillions of dollars to run itself. Let me then first say:

Passing legislation regarding health care is unconstitutional. Congress, and the president do not have the constitutional authority to pass such laws.

Putting things in perspective. In a previous post I said that 50 million Americans were uninsured for health care. I am one of them. The politicians throw out this number to scare you. Then they say that these people die without health care. That actual number is 22,000 unnecessary deaths each year due to uninsurance. I want to just put that in perspective. That is a tiny number. It is an insignificant number compared to a population that grows by millions each month. There are several million people that enter the United States each month; or are born each month. 22,000 people dieing from being uninsured is so statistically insignificant to not even warrant the scare tactics they use. Notice they never tell you that number? So then if only 22,000 die in an entire year from being uninsured what do the other nearly 50 million people do without insurance? They pay for it out of pocket, that’s what.

But I digress… Let’s move on to single payer health insurance.

Single payer health insurance is a system by which the health care expenditures of an entire population are paid for through one source – the Federal government or a subcontracting entity – using tax revenue from individuals and employers.

In essence this would be national insurance. Note that this is not national health care. Note this is not national medicine. This only covers the insurance costs.

Distinctly different from socialized medicine, whereby the government owns and operates health care facilities, a “single payer system” is simply a financing mechanism. The government collects and allocates money for health care but has little to no involvement in the actual delivery of services. Care is provided privately at hospitals and clinics but paid for publicly.

I think the power to pay a bill is the power to dictate to you how that bill is paid, i.e. although it says now it will not dictate how the medicine is delivered or who to receive it from, just give it a month.

Individuals are allowed to choose their providers, and physicians are either compensated on a fee-for-service basis or paid salaries by hospitals that receive an annual global budget or by nonprofit health maintenance organizations.

In essence this would simply eleminate your insurance company. You would still go to the same doctor or hospital. Single payer health insurance is just how those people would be paid.

All medically necessary services are covered by the insurance, including primary care and prevention, prescription drugs, long term care, mental health, substance abuse treatment, dental services, and vision care.

Supposedly you can no longer be turned down for a pre-existing condition. You could be treated for anything you have and it includes not only medical, but dental and vision as well.

Services are delivered based on need rather than on ability to pay. Coverage is uninterrupted and equal for everyone, thus ending the dependency of health care access upon employment status.

You would have the option of keeping your employers insurance or opting into the national insurance. Be careful here. Currently you are being paid less at your work so that companies can cover your insurance. If your company dropped the insurance, would they pay you more? That’s another drawback to this.

Single payer health insurance would save money by vastly reducing administration and paperwork and by giving the Federal government bargaining power to procure medications in bulk. Even more significant than the savings that a single payer system achieves are the universal coverage and comprehensive benefits it provides, thereby realizing the right of every person to quality health care.

I don’t buy this. But, currently 30% of the money paid into health care right now goes to pay salaries, administation and profits of insurance companies and has nothing to do with health care. Would a national program eleminate this expenditure? Not likely, unless instead of making and agency they just made a computer to process it. Which, they actually could do. Half the time banking today is done 40% of the time just through computers and no human is needed.

Hospital billing would be virtually eliminated. Instead, hospitals would receive an annual lump-sum payment from the government to cover operating expenses—a “global budget.” A separate budget would cover such expenses as hospital expansion, the purchase of technology, marketing, etc.

Now this is true. Instead of hiring a huge adminstrative staff at each and every hospital, they could have the nurse swipe your card and the rest of it would be pure doctor patient interaction. They could then afford to hire more doctors and nurses.

Doctors would have three options for payment: fee-for-service, salaried positions in hospitals, and salaried positions within group practices or HMOs. Fees would be negotiated between a representative of the fee-for-service practitioners (such as the state medical society) and a state payment board. In most cases, government would serve as administrator, not employer.

In essence doctors would not have to worry about administration themselves. This would simply continue the same compensation avenues it does today. Already big corporations hire doctors, or small companies or private practices.

The program would be federally financed and administered by a single public insurer at the state or regional level. Premiums, copayments, and deductibles would be eliminated. Employers would pay a 7.0 percent payroll tax and employees would pay 2.0 percent, essentially converting premium payments to a health care payroll tax. 90 to 95 percent of people would pay less overall for health care. Financing includes a $2 per pack cigarette tax.

In essence they are saying, doctor visit, hospital visit, swipe your card and you’re done. However be careful this doesn’t lead to a national I.D. card whereby they can track your every move and your constitutional freedoms are completely removed. This entire system is a very slippery slope.

For Profit Healthcare Insurers

More facts:
The insurance lobby spent $512,042,660 in 2008. In May of this year, 2009, they spent $1 Million in advertising alone.

They do not want a single payer as an option. It would completely cut them out. However current health insurance usefulness is obsolete. Health insurance should only be used for catastrophic health treatment to begin with. The current health insurance industry is hugely wasteful. They seek to optimize profits at the expense of the patients.

Understand this: another fact – health insurers do not pay for the truly sick in this country. We tax payers do. They dump off all sick people on the government under the medicare program and the tax payer pays for it.

This is what no one is talking about.

As far as I’m concerned health insurance companies have outlived their usefulness and are now just vultures feeding on people and taking their monthly premiums. They grow those premiums each and every year. If someone tells you otherwise, they are just ignorant or lying to you.

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Is Health Care a Right or Privilege?

Health Care: A Human Right or Payable Privilege

There is a raging health care debate going on right now. We have a grand melee being played out in the national news and in congress. We see before us in the arena “conservatives” fighting against “liberals”. When in fact they are both being paid for by health insurance.

Fact: The health insurance lobby paid out $512,042,660 in 2008.
Fact: in May of this year 2009 they paid $1 Million in advertising alone.
Fact: no one who sits on the congressional board debating the health care issue can propose a solution without health insurance as not being in the option.

It occurred to me that you hear a lot of American Medical Association [ which only represents 36% of all doctors ] being put forward as being for or against various parts of the debate, all with health insurance as the end option.

Before you can tackle any of these debates you have to answer one single question:

Is health care a right given by God or is health care a privilege you have to pay for out of your own pocket?

Once you answer that question it separates everyone in the debate. Those who believe it’s a right stand to the left and those who believe it’s a privilege stand to the right. We are consistently putting the carriage before the horse. You can’t have a real debate about health care reform without first knowing where you stand on that single question.

I’m going to go out on a limb and make some assumptions about those who would answer that question.

If Health care is a privilege

For those that feel health care is a privilege, they are essentially saying that, you must pay your own way for health care. In whatever form that takes is immaterial. The fundamental principle is your health care is coming out of your pocket, either paid for on your behalf or directly out of your pocket. These people would also believe that providing health care is a business and should be run at a profit. Medical schools are a business and should operate at a profit. The cost of medical school then by its nature assumes that since health care is a business and one that generates lots of money then going to medical school is a privilege and thus the cost to go to medical school should reflect the high cost of this profession. Of course the medical schools then charge according to their own prestige. Either the privileged would go to medical school or those willing to go into tremendous debt. As such doctors coming out of medical school more often that not would have this huge debt they have to pass on to their customers / clients i.e. patients. This is the essence of the health care is a privilege mind set. You must pay and you get what you pay for.

A dark side of this is that, since you think health care is a business, you would never do anything to hurt the business. You would influence food manufacturers to continuously degenerate food products. You would influence drug manufacturers to not produce remedial medicines, but only treatment systems. You also would make absolutely sure that prevention is never mentioned nor made popular. You would get your fingers firmly grasped around government so that health care was always subsidized and health care costs could rise unchecked. You would make sure the insurance industry was also in on the game and for the advancement of pricing and not prevention of prices.

I don’t point out the dark side of this side of the question of privilege as being bad, but it’s just as factual observation.

If Health Care is a God Given Right

For those that feel health care is a right, the question then falls to the question of payment. They feel that it is unfair that someone suffering from a catastrophic illness should have to reach into their own pocket and pay for it. They feel that the exorbitant fees could render most people completely insolvent and they think that is unfair and unjust. They don’t think payment should come out of pocket for your own personal health care. They think that we all should share the burden for health care. Essentially the young are paying for the old.

While I mentioned a dark side to health care as a privilege, it is not true to say that health care as a right is the exact opposite and doesn’t share the dark side of health care as a privilege. In a perfect world it would, however that’s not the reality.

Why? Because the people manipulating the system is on both sides of the fence. Nationalized health care is nearly dead in America. This shows you exactly who’s in control of the debate. If health care were a true God given right, then those promoting it would feel: prevention would be the primary focus of medicine; complete cures would be the next important focus of medicine and pharmacology; there would be no treatment systems; cures would be the focus of all pharmaceutical research.

Sadly if those were the true tenants of health care as a right, the medical industry would rebel. I’ll say this right now: there are cures for aids; there are cures for cancer; there are prevention for cancer. No one in the industry wants to reveal it because those two together account for trillions of dollars in revenue each year.

Personally I am not on either side of the fence for this question. I really don’t know what to think because regardless of how you fall on the question there is no one fighting for the right of people to live without tyranny. If you understood that sentence you’re ahead of the game.

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