Ravengate
Partners - Stock market, economic and political commentary by Patricia Chadwick

Floyd Norris of the New York Times wrote a very interesting article in that newspaper this past Saturday. He pointed out that since the 1950s when the Government started keeping track of debt levels in this country, debt growth has never been as slow as it was in the second quarter of this year.

He went on to explain that the private sector debt actually fell, also a first in over half a century, while Federal Government debt soared, a fact we all know to be true.

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Reading Betsy McCaughey’s op-ed article in today’s Wall Street Journal, I understand fully why the elderly are so scared about the possibility of a nationalized health care system. I believe it is must reading for everyone. You can read it by going to www.wallstreetjournal.com and then clicking on OPINIONS. Please do so.

Dr. McCaughey knows a great deal about health care and has spent the last five years as the Chairman and CEO of RID, an organization which is dedicated to the prevention of hospital-acquired infections. As a point of clarification, her doctoral degree is not in medicine, but is a Ph. D. in constitutional history.

The advice that President Obama is receiving from his health adviser, Dr. Ezekiel Emanuel, is scary stuff. Given that Dr. Emanuel is the brother of the White House Chief of Staff, Rahm Emanuel, one can only assume that he is more than a figurehead. Importantly, Dr. McCaughey provides numerous quotes from Dr. Emanuel’s writings. If I were in my 70s (and I am not THAT far away), I would be bombarding my Senator and Congressman with emails and phone calls.

I hope that Dr. Emanuel provides a response to Dr. McCaughey’s piece. I for sure will read it.

Remember 1993 and health care? It was doomed because Americans did not want Big Government running one more part of their lives. Why? Because Government doesn’t do things very well – it’s as simple as that.

They – the Government – euphemistically refer to its proposed health care plan as simply one option in the public/private marketplace. But we – the people – know what that plan really is. It is socialized medicine.

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Just two days ago, the New York Times heralded on its front page “Health Care Bill Passes First Test on Capital Hill”, a title that belied the fact that the health care bill as currently structured has almost no likelihood of becoming law. Moderate Democrat Senators have no stomach for it, because their constituencies have no stomach for it.

This morning’s Wall Street Journal’s front page headline signals the more likely path for the bill “Budget Blow for Health Plan”, a story that the New York Times has relegated to page 12 (page 3 of the National news section of the paper). When the Director of the Congressional Budget Office (CBO) contradicts the statements of Congressmen/women and Senators, trouble is brewing, and that is exactly what Douglas Elmendorf has done.

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With Governor Sanford in political Siberia and Governor Palin perhaps following him, Governor Mitt Romney should be smiling. Lots of things are going his way.

With the benefit of hindsight, had Candidate McCain chosen the Governor of Massachusetts and not the governor of Alaska as his running mate, the outcome of the election might have been different, but who knew in July of 2008 that in only three months, so much economic havoc would be wreaked.

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I went to the mall yesterday to try to gain a sense of whether consumers are buying and when we might see a recovery. The first thing I noticed was that the mall parking garage was nearly empty, but then I realized that yesterday was only the second day since Memorial Day when it had not been raining here in New England and so perhaps the lack of attendance might have had something to do with people’s need to ingest a bit of sunshine.

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The Obama Administration’s aggressive and seemingly frantic pressure to get a health care bill passed over the next few weeks (a virtual impossibility) brings back memories of sixteen years ago, in 1993 when the newly inaugurated Clinton Administration tried exactly the same thing. And it was that very aggressiveness on the part of (most particularly) Hilary Clinton that (thankfully) ultimately doomed the project. I predict the same thing will happen again in 2009.

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With Chrysler and General Motors in bankruptcy and under the ‘de facto’ if not ‘de jure’ management of the U.S. Government, the hue and cry emanating from the pundits and politicians and television journalists and on and on wails, “What is left of the American auto industry?”

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Lo and behold a couple of weeks ago, some of the channels on my TV stopped working. I realized it when I tried to watch MSNBC’s Morning Joe, a simply must have for me first thing in the morning – great guests, good politics and economics and lots of humor. Clicking around, I realized that I had also lost a lot of other channels and none of them did I think of as premium rate channels. They included A&E, Lifetime, Bravo, the History Channel, C-Span and some silly paid programming channels. I couldn’t make rhyme or reason of the selection, but one thing was certain – I am sure that those channels come with the basic coverage. The odd thing was that a couple of other televisions I have did not have any missing channels. But I’m not a big TV watcher, so I didn’t pay much attention to this difference in reception.

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Or put another way – Saving is the new spending in the United States.

After several decades of Americans being the world’s consummate and most profligate spenders, we appear to have developed (all of a sudden in just the last few months) a serious fancy for saving. This phenomenon is most evident in the Baby Boomer generation, those of us who were reared by frugal parents who themselves were reared during the Great Depression by parents, many of whom themselves were truly struggling to survive.

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