A look at the numbers...

We know that, where the Congressional Budget Office (CBO) is concerned, their hands are tied pretty snug when it comes to looking at the numbers. They are required to evaluate the information submitted to them, and not allowed to do independent research to confirm claims. Both Republicans and Democrats have used this to their advantage on their legislation and denounced it when it is in the opposition's favor. For example, in the Healthcare Reform debate, Democrats submitted criteria that included 10 years worth of revenue gathering, to pay for 6 years of benefits paid out. They also included double counting monetary benefits. Like taking $500 Billion out of Medicare fraud, waste , and abuse, using it to increase the solvency of the Medicare program. At the same time they claim to use this same $500 Billion  to reduce the deficit over the next ten years. Now, the reality of the government saving that much money on Fraud, Waste, and Abuse is a subject for another post. Suffice it to say this money is one half of the claimed deficit reduction.

The CBO determined that using the 6:10 formula, the program would cost $940 Billion over the first ten years. But wait, we are going to collect $940 Billion over ten years, we are going to pay it out over six years. Divide 6 into $940 Billion and that puts the cost of the program at $156.67 Billion a year, not $94 Billion as claimed.

So now that we now the true cost per year is $156.67 Billion, if you extrapolate that over 20 years, it is going to cost $3.13 Trillion. These numbers also do not include the cost of the "doc" fix for Medicare that congress has been postponing for years, and now we are to believe they are going to suddenly include it? This fix adds another $357 Billion (subsidy for doctors) to the deficit each year, and grows larger every year. Added to the $156.67 Billion, we now stand at over $500 Billion a year, not $94 Billion.

President Obama said in a recent (FOX, I think) interview... (paraphrase) Whoa, you cannot add the "doc" fix to the cost of my reform bill, it has been there for years and is a separate issue... to an extend he is correct! But, he also made claims early in the process that the doctor fix for Medicare was going to be part of the reform bill, and therefore he has to take ownership of the cost. Regardless of how long it has been getting kicked down the road, if it is going to be enacted, the money is coming out of the same pockets... your and mine!

Rumor has it the Democrats plan to raise that money, not on the rich (you know over $250,000 income), but with a VAT Value Added Tax, or National sales tax on everything you purchase.

more to come...