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Thursday, July 30, 2015

WASHINGTON (AP) -- Nonprofit co-ops, the health care law's public-spirited alternative to mega-insurers, are awash in red ink and many have fallen short of sign-up goals, a government audit has found.

Under President Barack Obama's overhaul, taxpayers provided $2.4 billion in loans to get the co-ops going, but only one out of 23 - the one in Maine - made money last year, said the report out Thursday. Another one, the Iowa/Nebraska co-op, was shut down by regulators over financial concerns.

The audit by the Health and Human Services inspector general's office also found that 13 of the 23 lagged far behind their 2014 enrollment projections. read more


Comments

"And blah, blah, blah. We need and FDR not some Libertarian lunatic."

Maybe, but here's the problem with that argument. FDR enacted policies under the advisement of John Maynard Keynes. One of the underlying assumptions of Keynesian policy was the existence of a willing workforce, and during the depression there was a willing workforce. In many cases, people left home or crossed the country in order to find employment in a government sponsored jobs program. Today that's not the case. The "workforce" is far less willing, unless it's a job they want in the region they want at a wage they want. And if not, government benefits that require no obligation in return are a pretty nice consolation prize.

Consider this: In 1934, if you were a worker in the government-sponsored CCC, you would earn $30 a month, plus room, board, medical care, and clothing. In return, they were obligated to work for 40 hours per week. If you were to resume this program in 2015, the inflation adjusted income would be $550 per month. Given 21.6 average work days in a month, that comes out to about $25.50 per day, about $3.19 per hour. It's also worth noting that no less than $22 would be directed toward a mandatory allotment to a family member.

If you've been around for long enough, you've heard me tout the resurrection of a CCC-like program, that the government should be the employer of last resort; but how many people do you think are going to be willing to for $3.19 per hour, even if room, board, clothing, and medical care was included? They can get more than that through transfer payments.

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