• Straight talk on mutual funds, bonds, real estate, and annuities
• Techniques for avoiding financial disasters
• Tools to help readers track their debt and create a plan for staying out of it
• Road maps to buying a home and saving for college and retirement

Today's Commentary: 01.30.06
A Political Bandage:
A Look at the State of the Union Address, 2006

"My fellow Americans,the next three years of my administration will be better the the first five. I will continue to play the terror card whenever possible because it works. I will continue to think that everyone in this country is suspect until proven otherwise, is Republican or a lobbyist. I will eventually convince everyone that the mere mention of my name will make the average writer, blogger, pundit, talking head or NPR employee suspect and worthy of a quick review of their phone, email, internet search records. I understand the need to report on the doings of your government in addresses such as this one, but the way I figure it, by the time you sue us for some breach of your civil liberities, the Supreme Court will have granted me all the executive power I need to run a government the way I want to run a government. The Veep says so.

"My approval ratings are down, they tell me but that doesn't matter because I have an economic plan that is working and a plan for the next three years to make it even better.

"The tax problem was almost solved but we were outed. Those fraud computers down at the IRS say that the poor folks who had money coming didn't deserve the refund they claimed they had coming. That danged earned income tax credit was at the core of the whole problem. Sure they will eventually get their measly $3,500 back. But freezing these accounts so we could investigate them was a good idea. Heck, what could they do? It allowed the government to trim the federal deficit by a cool $9 billion. And when it comes to the deficit, every little bit helps.

"My old buddy over at the Treasury, John Snow, reluctantly addressed the topic several days ago and came up with a great solution. We'll tell those lower income folks that we suspect them and then we'll freeze the accounts. Simple as that. Really. Who are the going to run to anyway? The IRS? Mark Everson, the commissioner thought Johnny's suggestion was just great.

"That pesky Nina Olsen, the tax advocate, even went so far as to suggest that the $9 billion number was shy of what was really owed. She told Congress this and that they found very little fraud involved in the frozen accounts. This gave Senator Grassley the opportunity to grandstand about the changes. I understand that Ms. Olsen is just doing her job, but suggesting that we should be looking into small business fraud instead is just going too far. She claims that in businesses dealing with cash that there is an estimated $100 billion worth of taxable money unaccounted for and this would be a much better place for the IRS to look. She doesn't understand that I am the business president and that sort of investigation would be counterproductive. That so0called, and unproven fraud creates jobs, employs immigrants workers, keeps folks off welfare and allows them spending money at the local Wal-Mart. In other words, it keeps the economy humming right along.

"Some folks simply advocate for the wrong things. I say that all you need to do is look the other way and if you are caught, find something positive to say about it. Works for me. The Veep says so.

"In the next three years, I will fix this healthcare issue once and for all. So Iraq won't be my legacy; so Social Security won't be the hallmark of my administration; so we won't get a balanced budget; those things don't matter. Nine out of ten older people with investable incomes in excess of $10 million are worried about how to pay for long term care. This is the best demographic available to determine the needs of the country. I used these folks as a template for my tax cuts. Because they represent the cross section of the people I serve, they should also be used in helping us determine how the future of health care in the country should shaped.

"These are hard working people who find themselves exhausted and broken from years of amassing great fortunes in the effort to employ those who are not wealthy. You think it is easy maintaining a 400 to 1 pay ratio? It's not. And when they retire, they are more susceptible to long term health issues.

"Those long term health issues make them worry, not just about themselves and protecting their money, but about the fate of Medicare and Medicaid. Congress is working on a solution for this problem by allowing many of these folks to protect their hard earned assets by debating the closing of loopholes. Similar to the debate on lobbyists, this will not go where it is intended.

The reason they are worried is because it costs a lot to stay at a nursing home. Estimates run as high as $70,000 a year, which when Medicare drops the ball, Medicaid picks up the tab. The solvency of those two programs is important to these folks. They have assets to protect, hard earned assets that shouldn't be taken away from them just because they are rich.

"Some folks want me to address this by saying health care in this country is more important than Social Security is. The National Governors Association thinks that the poor and middle class would be better served if they had their accessibility to these entitlement programs cut short. Think of how much money we would save the system if they were denied them long term nursing home care. If you know the situation the way these governors know it, you would realize that these folks have hardly any assets to protect, let alone sell, to help offset the cost. So they suggest, let them keep the house and have someone take care of them at home.

"Hey, that creates another small business opportunity for low wage workers who could get paid cash so their employers wouldn't have to pay taxes and that way everyone wins. But what this country needs is an even better solution.

"Now most folks don't know it, but Medicare was started forty years ago and quite frankly, nothing really runs they way it should after that much time. So that's why, when I put Tom Scully in charge, I wanted to see some changes made. He's did a fine job; a lot that guy who was railroaded outta FEMA. Tom understood the need for reform that's why he championed that prescription drug plan. You just wait and see on that one. Eventually those seniors will understand that program even if I don't.

"Ol' Scully has since left public service. We should thank him for his forward thinking. The "other side of the aisle" should just let it be. They are suggesting breaches of ethics but I know for a fact that just because Tom was a lobbyist before he got the Medicare post and is now a lobbyist afterwards has no bearing on the kind of legacy he has left the program. Besides, he got an ethical waiver.

"Medicare will be better served by the changes we are making. For instance, the choices aren't so confusing. Elderly people are just old, not dumb. They should understand that turning this program over to the private sector does not necessarily create another layer of bureaucracy. Critics of the prescription plan say it does not make cheap drugs available and caters to the pharmecutical copanies. Even if we don't buy 'em bulk anymore, the system will work itself out. Scully said so.

"The health savings plan, which is an important part of the overall health reform has been slow to be adopted. Go figure. This a plan that employers should push. Employees haven't been so smart either. They sign up but that's where it ends.

"Seniors of a certain wealth understand the need for private insurance and these plans are sort of like that. They are a high deductible insurance policy that ask that employees only have to cough up - that's a pun - a $1050 deductible and then pay a smaller premium. The chance to save pretax dollars for the future cost of your own care, I mean, who wouldn't jump on board? The wealthy have and they are the envy of everyone.

"Critics have said that folks will be more inclined to build up their savings than seek help they may need. Critics have said that the plans were designed to help employers save on health costs. The critics are wrong on both counts. The plans will make Americans healthier by making it economically worth their while to be healthier. They will be understand that good health is just cheap. If they do get sick, they will use the money they saved to buy lower cost drugs.

"In fact, I believe in the so much that I will call on Congress to raise the tax free contribution limit to allow more of my well heeled cohorts the opportunity to avoid a few more centavos in taxes.

"Just three more things to talk about. First, the last day of the Greenspan era is upon us. Mr. G. served his government well and was especially gracious in the last four years,. His interest rate cuts helped keep the economy going just when we needed a little economic inspiration. And his wink and nod approach to the tax cuts and his roundabout way with words allowed us to shift from a surplus to a deficit without much in the way of criticism. Sure he talked about pay-go, an economic term that means something like, if you can't pay for it, borrow the money and then just go, may have added to the increased deficit, but it was just what this country needed. He leaves some pretty big shoes for Benji to fill. But Ben Bernanke worked directly with me in the White House and I am confident the he will do his best to keep the right agenda on course. Good luck to you Alan and Godspeed.

"You are all aware of the World Economic Forum that took place in Davos this past week. We televised Condi because it would seem inappropriate to send anyone to the event. It has turned into a billionaire's Sundance. Bono was there. I met Bono. Nice fellow. He wants big business to help solve the world's problems. That's a good idea I told him. Folks shouldn't rely on governments to save them. Governments are supposed to take care of the well-to-do and they in turn will create the opportunities for common people to save themselves. Let those Google boys donate some of those billions of dollars they have.

"And lastly, I was right about Iran. They are evil. I was right about that. They have forced the price of oil back up and they are making money hand over fist because of it. Now most folks don't know it but Iran is only good for 5% of the oil in the pipeline - another pun - and they are not that much of a factor. But folks worry about the cost. The nuclear option is a problem but I'm sure we'll find a solution to that that won't screw up the whole global oil market. We have friends over there, you know and they won't let it get too out of hand.

So, there you have it. We have a lot to be thankful for and my administration is doing a heck of a job telling you that we are doing a heck of a job. Remember, we don't look at the polls. I have an agenda and I know it will be good for the American people in the long run.

Good Night, and Good Luck.

BlueMoney Report

The Blue Money Report
Financial Commentary covering a wide range of topics concerning money, investing, and how it effects the average investor and their financial health.

It is the World of Money and Investing Explained.

Our Publication
If you are interested in providing your readers with our syndicated column, you can request it here