Delayed Obamacare Requirement

The Obama administration has told insurance companies that it will delay requirements for them to disclose data on the number of people enrolled, the number of claims denied and the costs to consumers for specific services.

When this requirement actually does go into effect next year, what do you think its outcomes will be?Will it hurt insurers? Or even the market place as a whole due to problems with adverse selection? Will people be willing to stay in a plan if they feel like they are not proportionately benefiting from it? Or will this favor consumers? Will it keep insurance companies from profiting too much? 

Insurers' Consumer Data Isn't Ready for Enrollees - NYT 

Also check out a summary, graphics, and more detailed analyses of the current state of the Affordable Care Act here: Is the Affordable Care Act Working? - NYT.

Euro Zone at Risk for Recession Relapse

The president of the European Central Bank warned members of the Euro Zone that if they did not agree on policy and push forward economic reforms, that the Euro Zone may be looking at another recession in the near future. With unemployment still extremely high, some countries believe that they should increase their spending to help get out of the recession. Other countries believe that you can't just have monetary policy and you need to have other policies put into place as well. Do you think the   ECB should lessen its regulation on spending to allow economies to try to grow bigger? Or is the ECB right in restricting spending? What would you say if you were sitting in on the summit?http://www.foxbusiness.com/economy-policy/2014/10/24/ecb-draghi-euro-zone-at-risk-for-recession-relapse/?intcmp=fbfeatures

More Interesting IRS Actions

Law Lets I.R.S. SeizeAccounts on Suspicion, No Crime Required - NYT

The I.R.S. has been seizing the money of people who have made consistent cash deposits under $10,000 without pressing charges of any wrongdoing.  

Using a law designed to catch drug traffickers, racketeers and terrorists by tracking their cash, the government has gone after run-of-the-mill business owners and wage earners without so much as an allegation that they have committed serious crimes. The government can take the money without ever filing a criminal complaint, and the owners are left to prove they are innocent. Many give up.

“They’re going after people who are really not criminals,” said David Smith, a former federal prosecutor who is now a forfeiture expert and lawyer in Virginia. “They’re middle-class citizens who have never had any trouble with the law.”

This news comes not only after increased criticism of corrupt I.R.S. practices, as we saw in class, but also following reports of similar issues around civil forfeiture in other public service bodies such as law enforcement.

As John Oliver put it on his show Last Week Tonight: while people are innocent until proven guilty, money and property are not. For more of his humorous take on civil forfeiture and all its horror check out the full episode.

Do these corrupt practices call for cuts to the power of (and tax revenue given to) the I.R.S. and/or law enforcement? Is this simply a symptom of government getting too big? Or do these bodies need other groups to oversee and audit them? How do incidences like these affect citizens' trust in government? How can a country be negatively affected if citizens become apathetic and distrustful of government agencies? Other thoughts/comments?

Apple's Continued Success and (Non)Compliance with US Corporate Taxation

Yesterday’s Times article When iPhones Rings, the Economy Listens discusses Apple’s continued success following the release of the iPhone 6. It explains that Apple makes about a 50% profit on the sell of each iPhone. This high rate of profitability has lead Apple to be “the core of the stock market” according to Sommer.

Apple is the biggest company, by market capitalization, in the world. Apple accounts for about 3.5 percent of the weighting of the Standard & Poor’s 500-stock index. And, through Thursday, because its stock has performed magnificently while the overall market has not, Apple accounted for 18 percent of the entire rise of the S.&P. 500 index this year, according to calculations by Paul Hickey, co-founder of the Bespoke Investment Group. And the engine driving Apple shares is the iPhone.

Since Apple is such a large company, making its success clearly linked to the success of our economy, the way that it is taxed has spurred a lot of debate the past few years. An article from last year about a Senate hearing on taxation reveals two drastically different perspectives on how we view and implement corporate taxation.

On the one hand you have some Republicans and Democrats alike who feel Apple does not pay enough US taxes:

Democratic Senator Carl Levin, chairman of the Senate's Permanent Subcommittee on Investigations, and John McCain, the panel's top Republican, both started the hearing with withering criticism of Apple's practice of shifting income to Ireland to avoid paying U.S. taxes.

Levin called the practice a "sham," while McCain said that Apple's claim that its use of the Irish subsidiary did not reduce its U.S. taxes is "demonstrably false."

"U.S. corporations cannot continue to avoid paying their appropriate share in taxes," said McCain. "Our military can't afford it. Our economy cannot endure it. And the American people will not tolerate it."

On the other hand, some Senators think that Apple was right to avoid taxes when possible, especially since US corporate tax policy is not business friendly:

"Tell me one of the politicians up here who doesn't minimize their taxes. Tell me a chief financial officer you would hire if he didn't try to minimize taxes legally. Tell me what Apple has done that is illegal," said Paul. He said that Congress should apologize to Apple for calling it before the committee, and for a tax system that is "bizarre and Byzantine."

"Money goes where it's welcomed," Paul said. "Currently our tax code makes money not welcomed in this country."

So should tax policy stay as it is, so that Apple can continue to be successful, thus strengthening our economy? Or since they have such a high profit margin would the benefits of heavily taxing them outweigh the potential costs to their productivity and job creation? Is Apple wrong to use the loopholes that are available to them? Or is the problem bad corporate tax policy? Should Apple even have to pay any taxes since they are so important to our economy?

Political Polarization: Which Came First, Media Choice or Values?

Yesterday's NYT article Americans Don't Live in Information Cocoons made me think back to our discussion on political polarization and media.

A recent PEW Research study has been interpreted by many to indicate that we are living in "partisan and ideological echo chambers." This interpretation seems to be a growing concern as technology increases consumer access to polarized media. 

This article, however, concludes views the results of PEW's polling and other research :

The problem isn’t the news we consume, it seems, but the values and identities that shape how we interpret that information — most notably, our partisan beliefs. In other words, Democrats and Republicans don’t see the world so differently because they see different news; rather, they see the news differently because they’re Democrats and Republicans in the first place.

I found these ideas about political polarization and the media's questionable ability to sway peoples' ideas particularly interesting in relation to our class discussions and blogging. Do you think that when we read a blog post or article that does not align with our values and ideology we dismiss it? Or do you think that you are able to keep an open mind and sometimes even shift what we think based on new/different information?

Do you more commonly read news sources that are associated with your political positioning? When you read articles from news sources that are associated with other political standings, are you more critical of them? Or do they tend to sway you to their side on that issue? If values do come first, then is it fine to, for example, only read the Times and not the Journal, or visa versa?