konane's Blog

Frank M. Carrio, CMI  ESOP Committee Member

Sourch  InterNACHI Message Board

However, once the lower classes feel the pinch in their wallets, you can be sure these voters get a tax refund (even if they pay no taxes at all) to offset this new cost. Thus, you Mr. and Mrs. Middle Class America will have to pay even more since additional tax dollars will be needed to bail out everyone else.


But wait. This awful bill (that no one in Congress has actually read) has many more surprises in it. Probably the worst one is this:

• A year from now you won't be able to sell your house. Yes, you read that right.

The caveat is (there always is a caveat) that if you have enough money to make required major upgrades to your home, then you can sell it. But, if not, then forget it. Even pre-fabricated homes ("mobile homes") are included.

• In effect, this bill prevents you from selling your home without the permission of the EPA administrator.
• To get this permission, you will have to have the energy efficiency of your home measured.
• Then the government will tell you what your new energy efficiency requirement is and you will be forced to make modifications to your home under the retrofit provisions of this Act to comply with the new energy and water efficiency requirements.
• Then you will have to get your home measured again and get a license (called a "label" in the Act) that must be posted on your property to show what your efficiency rating is; sort of like the Energy Star efficiency rating label on your refrigerator or air conditioner.
• If you don't get a high enough rating, you can't sell. And, the EPA administrator is authorized to raise the standards every year, even above the automatic energy efficiency increases built into the Act.

The EPA administrator, appointed by the President, will run the Cap & Trade program (AKA the "American Clean Energy and Security Act of 2009") and is authorized to make any future changes to the regulations and standards he alone determines to be in the government's best interest. Requirements are set low initial y so the bill will pass Congress; then the Administrator can set much tougher new standards every year.

• The Act itself contains annual required increases in energy efficiency for private and commercial residences and buildings.
• However, the EPA administrator can set higher standards at any time.

Sect. 202:
Building Retrofit Program mandates a national retrofit program to increase the energy efficiency of all existing homes across America .

Beginning 1 year after enactment of the Act, you won't be able to sell your home unless you retrofit it to comply with the energy and water efficiency standards of this Act.

You had better sell soon, because the standards will be raised each year and will be really hard (i.e., ex$pen$ive) to meet in a few years. Oh, goody! The Act allows the government to give you a grant of several thousand dollars to comply with the retrofit program requirements if you meet certain energy efficiency levels. But, wait, the State can set additional requirements on who qualifies to receive the grants.

You should expect requirements such as "can't have an income of more than $50K per year", "home selling price can't be more than $125K", or anything else to target the upper middle class (and that's YOU) and prevent them from qualifying for the grants.
Most of us won't get a dime and will have to pay the entire cost of the retrofit out of our own pockets. More transfer of wealth, more "change you can believe in."

Sect. 204:
Building Energy Performance Labeling Program establishes a labeling program that for each individual residence will identify the achieved energy efficiency performance for "at least 90 percent of the residential market within 5 years after the date of the enactment of this Act."

This means that within 5 years 90% of all residential homes in the U.S. must be measured and labeled. The EPA administrator will get $50M each year to enforce the labeling program. The Secretary of the Department of Energy will get an additional $20M each year to help enforce the labeling program. Some of this money will, of course, be spent on coming up with tougher standards each year.

Oh, the label will be like a license for your car. You will be required to post the label in a conspicuous location in your home and will not be allowed to sell your home without having this label.
And, just like your car license, you will probably be required to get a new label every so often - maybe every year.
But, the government estimates the cost of measuring the energy efficiency of your home should only cost about $200 each time.

Remember what they said about the auto smog inspections when they first started: that in California it would only cost $15. That was when the program started. Now the cost is about $50 for the inspection and certificate; a 333% increase. Expect the same from the home labeling program.

Sect. 304:
Greater Energy Efficiency in Building Codes establishes new energy efficiency guidelines for the National Building Code and mandates at 304(d), Application of National Code to State and Local Jurisdictions, that 1 year after enactment of this Act, all state andlocal jurisdictions must adopt the National Building Code energy efficiency provisions or must obtain a certification from the federal government that their state and/or local codes have been brought into full compliance with the National Building Code energy efficiency standards.

a license required for your home - Google Search

H.R. 2454: American Clean Energy and Security Act of 2009 (GovTrack.us)

http://www.nachi.org/forum/f14/cap-and-trade-license-required-your-home-44750/

The Irish Times - Tuesday, April 6, 2010

"Bailout has turned us from citizens into serfs

"After a century and a half of struggle, we’ve landed ourselves back in the same position of feudal servitude, writes FINTAN O'TOOLE 

A QUESTION haunts me because I can think of no good answer: why should anyone who has a choice continue to live in Ireland? This is not an abstract thought experiment. I have two sons in their early 20s. I am trying to find one compelling reason for them to stay here.

In the 1980s, the mark of the degradation of Ireland under Charles Haughey was that Irish passports were for sale to non-citizens. Now we have come up with something worse: citizens have to pay too. To belong to this State, we have to pay what is in effect a Seanie and Fingers Tax (SFT). Our ancestors had their rents raised when their absentee landlords lost fortunes at the gambling tables of London or Paris. After a century and a half of struggle, we’ve landed ourselves back in precisely the same position of feudal servitude.

Let’s take some admittedly very crude figures sketched by Nat O’Connor on the progressive-economy.ie blog. There are 1.9 million people at work in the Irish economy. Their average earnings last year were €36,300. After tax, that’s €29,500 each. From this, each one will stump up an average of €4,600 just to pay the interest on the money the State is borrowing to fund the bank bailout.

Or, to put it another way, everyone lucky enough to have a job in Ireland over the next 10 years will be working most of one day a week to pay for Seanie, Fingers and the lads. It is no exaggeration to call this feudal. Medieval lords exacted food and money from their vassals. They called it “coign and livery”. We call it “Nama and recapitalisation”. Why would anyone who can do otherwise choose to donate about five or six hours of free labour every week for 10 years to the banks? In all of this, the humiliation is actually worse than the money. The financial cost is, admittedly, hideous. Let’s just consider the €2 billion a year we’ll be stumping up for the zombie institutions, Anglo Irish and Nationwide.

The exchequer (perhaps optimistically) expects to take in €11.5 billion in income taxes this year. So, more than one euro in every six we pay in income tax will go to fund institutions that will probably never put another cent into the Irish economy.

Every year until at least 2021, we will be putting €500 million more into Anglo and Nationwide than into the Department of the Environment’s capital budget. (At least John Gormley will be able to say that the Government is spending unprecedented sums on sewage systems.)

The social and economic costs of this are devastating, especially when you think of what else we could do with the money. For the annual €2 billion we’re putting into Anglo and Nationwide, we could almost double what the State spends on mental health services and disability services.

We could almost quadruple spending on children and families. For just two years of the SFT, we could build a national high-speed broadband network, putting people to work in the process and greatly improving our economic competitiveness.

So, yes, the financial side of the SFT is sickening. But the humiliation is worse. The idea that, year-in, year-out, we will be working to pay off the gambling debts of our absentee landlords, turns us from citizens to serfs. It cuts to the heart of the meaning of a democratic community – the sense of mutual obligation. Now, all the obligations are one way. We can no longer even pay lip service to social justice. The most rank and brazen injustice is written into every clause of our new social contract.

Humiliation is the most corrosive of emotions. It destroys self-respect. It generates the sense of absolute powerlessness that is every bit as corrupting as absolute power. It festers and sours. It turns both inwards on itself and outwards on to those who are even weaker than ourselves. It took us a century to overcome our sense of national humiliation and a little over a decade to give it back.

It is humiliating to have to work most of a day a week for scroungers and scoundrels. It is humiliating that Brian Cowen, who bears as much personal responsibility for this disaster as anyone else, is still Taoiseach. And it is humiliating that, collectively, we seem incapable of anything beyond impotent rage.

The national strategy is to breed servility back into Irish bones. We are instructing our young people to relearn the ways of their ancestors and to tug the forelock as they clean up the mess left by the Masther, God bless him. Why would they want to do that? Why would they choose, if they are fortunate enough to get work here, to hand over a substantial chunk of what they earn to pay for a profligacy in which they had no part? Much as I want my sons to stay here, I’d be ashamed of them if they did not utter the cry of James Joyce a century ago: non serviam , I will not serve."

http://www.irishtimes.com/newspaper/opinion/2010/0406/1224267752939.html

Cow gas not working for them huh?   Mother Nature wins again.

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By Louise Gray, Environment Correspondent
Published: 7:00AM BST 08 Apr 2010

Source Telegraph.co.uk 

"In the past environmentalists, from Lord Stern to Sir Paul McCartney, have urged people to stop eating meat because the methane produced by cattle causes global warming.

However a new study found that cattle grazed on the grasslands of China actually reduce another greenhouse gas, nitrous oxide.

 Related Articles

Authors of the paper, published in Nature, say the research does not mean that producing livestock to eat is good for the environment in all countries. However in certain circumstances, it can be better for global warming to let animals graze on grassland.

The research will reignite the argument over whether to eat red meat after other studies suggested that grass fed cattle in the UK and US can also be good for the environment as long as the animals are free range.

Klaus Butterbach-Bahl, of the Karlsruhe Institute of Technology in Germany, carried out the study in Inner Mongolia in China. He found that grassland produced more nitrous oxide during the spring thaw when sheep or cattle have not been grazing. This is because the greenhouse gas, also known as laughing gas, is released by microbes in the soil. When the grass is long snow settles keeping the microbes warm and providing water, however when the grass is cut short by animals the ground freezes and the microbes die.

Dr Butterbach-Bahl said the study overturned assumptions about grazing goats and cattle.

"It's been generally assumed that if you increase livestock numbers you get a rise in emissions of nitrous oxide. This is not the case," he said.

Estimated nitrous oxide emissions from temperate grasslands in places like Inner Mongolia as well as vast swatches of the United States, Canada, Russia and China account for up a third of the total amount of the greenhouse gas produced every year. Nitrous oxide is the third most important greenhouse gas after carbon dioxide and methane.

But Dr Butterbach-Bahl pointed out that the study did not take into account the methane produced by the livestock or the carbon dioxide produced if soil erodes. He also pointed out that much of the red meat eaten in the western world if from intensively farmed animals in southern countries.

He said the study does not overturn the case for cutting down on red meat but shows grazing livestock is not always bad for global warming."

http://www.telegraph.co.uk/earth/environment/climatechange/7564682/Cows-absolved-of-causing-global-warming-with-nitrous-oxide.html

http://www.zerohedge.com/article/genesis-gold-tungsten-rest-story

Submitted by Tyler Durden on 04/07/2010 10:30 -0500

Source Zero Hedge 

"Continuing on the trail of exposing what is rapidly becoming one of the largest frauds in commodity markets history is the most recent interview by Eric King with GATA's Adrian Douglas, Harvey Orgen (who recently testified before the CFTC hearing) and his son, Lenny, in which the two discuss their visit to the only bullion bank vault in Canada, that of ScotiaMocatta, located at 40 King Street West in Toronto, and find the vault is practically empty. This is a relevant segue to a class action lawsuit filed against Morgan Stanley, which was settled out of court, in which it was alleged that Morgan Stanley told clients it was selling them precious metals that they would own in full and that the company would store, yet even despite charging storage fees was not in actual possession of the bullion. It appears that this kind of lack of physical holdings by all who claim to have gold in storage, is pervasive as the actual gold globally is held primarily in paper or electronic form. Lenny Organ who was the person to enter the vault of ScotiaMocatta, says "What shocked me was how little gold and silver they actually had." Lenny describes exactly how much (or little as the case may be) silver was available - roughly 60,000 ounces. As for gold - 210 400 oz bars, 4,000 maples, 500 eagles, 10 kilo bars, 10 one kilogram pieces of gold nugget form, which Adrian Douglas calculates as being $100 million worth, which is just one tenth of what the Royal Mint of Canada sold in 2008, or over $1 billion worth of gold. As Orgen concludes: "The game ends when the people who own all these paper obligations say enough and take physical delivery, and that's when the mess will occur."

Also note the interesting detour into what Stephan Spicer, a VP of a major bank and a friend of the proprietor of the Central Fund Of Canada, has said in regard to these observations: he wanted access to his 15,000 oz of silver, and had to wait 6-8 weeks for its to be flown in from Hong Kong. What this may imply for the CFC itself is rather critical - the CFC notes on its website it is in possession of 1.3 million and 67.3 million ounces of gold and silver, respectively. One wonders just how much actual gold is really backing these claims.

It is funny that central bankers thought they could take the ponzi mentality of infinite dilution of all assets coupled with infinite debt issuance, as they have done to fiat money, and apply it to gold, in essence piling leverage upon leverage. They underestimated gold holders' willingness to be diluted into perpetuity - when the realization that gold owned is just 1% of what is physically deliverable, you will see the biggest bank run in history.

Link to full Eric King interview. "

http://www.zerohedge.com/article/latest-gold-fraud-bombshell-canadas-only-bullion-bank-gold-vault-practically-empty

From SteveQuayle.com/News  Posted because they don't usually leave photos up very long.

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http://www.stevequayle.com/News.alert/10_Photo_of_Day/100406.photo.of.day.html

This song got some radio play when it came out but imagine 'the establishment' was happy to have it fade away.  My opinion brilliant lyrics describing a bad 'trip'.  Couldn't find better audio on YouTube, so chose the one displaying lyrics.

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"Artist: Kenny Rogers & The First Edition

Album: The First Edition

Appears On (Mixes): Pray For My TV Show

Song Notes: This is probably most known now from appearing in The Big Lebowski, though it was actually a hit in its own right. Also, a lot of people don't realize that's Kenny Rogers singing it, since he's often thought of as being more-or-less completely a Country singer. But his first band, The First Edition was more or less a straightforward rock band that dabbled in psychedelia (sort of like The Amboy Dukes featuring one Ted Nugent) -- though a couple of their biggest hits ended up being crossover successes on both the country and pop charts. So, how about that? It's also a really good song, too, so that always helps. Mike Post produced this recording, and that's Glen Campbell playing the reverbalicious guitar solo."
http://music.wikia.com/wiki/Just_Dropped_In_To_See_What_Condition_My_Condition_Was_In:Kenny_Rogers_And_The_First_Edition

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April 4, 2010 Posted by John at 10:23 AM

"Violence by liberals against conservative and Republican targets continues, picking up where it left off in the 2004 and 2006 campaigns. This time, it was the Republican headquarters in Marion, Ohio:

Two Republican party officials were shocked to hear someone had thrown a brick through a window at their headquarters downtown -- with a message directed at stopping conservatism.

"Stop the right wing," was written in purple ink on a piece of notebook paper.

When the leader of their party talks about bringing guns to fights, it is no wonder if Democrats think it is acceptable to throw bricks through windows.

Via RedState. "

http://www.powerlineblog.com/archives/2010/04/025989.php

Some of the prettiest lyrics ever written.

____________

http://www.canadafreepress.com/index.php/article/21566

Listen to 'em long enough and the truth comes out. 

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Posted by Karl Denninger

Source The Market Ticker

"The Fed Admits To Breaking The Law

Now how long will it be before something is done about it?

April 1 (Bloomberg) -- After months of litigation and political scrutiny, the Federal Reserve yesterday ended a policy of secrecy over its Bear Stearns Cos. bailout.

In a 4:30 p.m. announcement in a week of congressional recess and religious holidays, the central bank released details of securities bought to aid Bear Stearns’s takeover by JPMorgan Chase & Co. Bloomberg News sued the Fed for that information.

The problem is this: The Fed is not authorized to BUY anything other than those securities that have the full faith and credit of The United States.

In addition Ben Bernanke has repeatedly claimed that these deals would not cost anyone money.  But the current value looks differently:

Assets in Maiden Lane II totaled $34.8 billion, according to the Fed, which set their current market value in its weekly balance sheet at $15.3 billion. That means Maiden Lane II assets are worth 44 cents on the dollar, or 44 percent of their face value, according to the Fed.

Maiden Lane III, which has $56 billion of assets at face value, is worth $22.1 billion, or 39 cents on the dollar, according to the Fed’s weekly balance sheet. A similar calculation for the Bear Stearns portfolio couldn’t be made because of outstanding derivatives trades.

In other words, they have lost more than half of their value.

This was and remains a blatantly unlawful activity.

The Fed has effectively usurped Article 1 Section 7 of The Constituion which reads in part:

All bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.

The Fed effectively appropriated taxpayer funds without authorization of Congress.  At the time these facilities were put in place neither TARP or any other Congressional authorization existed for them to do so, and to date no bill has been put through Congress authorizing the expenditure of taxpayer funds, either through putting them at risk or via outright expense, for this purpose.

Nor does it stop with a "mere" Constitutional violation - The Federal Reserve Act's Sections 13 and 14 do not permit Fed asset purchases except, once again, for items carrying "full faith and credit" guarantees.  Credit-default swaps and trash mortgages most certainly do not meet these qualifications.

I know I've harped on this for more than two years, but here we have a raw admission of exactly what was done - and there is simply no way to construe any of it in a light that conforms with either The Constitution or black-letter statutory law.

What's worse is that Tim Geithner, head of the NY Fed at the time, was very much involved in this - that is, he in effect personally, along with Ben Bernanke, usurped the power of the United States House.

The Fed has spent two years trying to hide this from the public and Congress.  It has fought off both Congressional demands for disclosure and multiple FOIA lawsuits, the latter of which has resulted in a series of adverse rulings (and, it appears, was ultimately going to force disclosure anyway.)

These actions are unacceptable but promising "never to do that again" is insufficient.  In a Representative Republic where the rule of law is supposed to be paramount - that is, where we do not crown Kings and relegate everyone else to the status of knaves, unlawful actions such as this demand that strong and unmistakable sanction also be applied to all wrongdoers in addition to protection against future abuse.

In this case this means that both Geithner and Bernanke must go - for starters.

Amending The Federal Reserve Act of 1913 (as Chris Dodd has proposed to prevent future lending bailouts) is not sufficient in that The Fed did not lend in this case, it purchased, and by buying what we now know were trash loans it violated the black letter of existing law.

There is only one effective remedy for an institution that has proved that it will not abide the law: it must be stripped of all authority that has been in the past and can be in the future abused.

This means that The Fed, if we are to keep it at all, must be relegated to a body that only practices and provides monetary policy - nothing more or less - and that all monetary operations must be performed openly, transparently, and within those constraints.

We cannot have a republic where an unelected body is left free to violate The Constitution with wild abandon and those acts are then allowed to stand.

One final thought: If the individuals responsible for this blatant black-letter violation of the law do not face meaningful sanction for these acts, and neither does The Fed as an institution, can you fine folks over at The Executive, Judiciary and Legislative branches of our government please explain to us ordinary Americans why we should obey any of the laws of this land when you will not enforce the laws that already exist?"

http://market-ticker.org/archives/2147-The-Fed-Admits-To-Breaking-The-Law.html

They'll think of something .... they always do. 

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March 31, 2010
"Wonder where the next 'crisis' will be manufactured

David Coughlin
Source AmericanThinker.com

"The Democrat political template is very predictable and depends on a complicit liberal Mainstream Media (MSM) to cover up and obfuscate for shortcomings in policy execution. The Democrat political strategy to inundate, exaggerate, obfuscate, and inoculate policies is evident in domestic policy initiatives as well as foreign policy efforts. The process begins with a classic Cloward-Piven strategy to overwhelm the public with "crisis" after "crisis" that only Democrats can successfully address.

These "crises" are many times based on real national problems, but are exaggerated and personalized to manufacture the idea of impending doom that will appeal to the emotions of the electorate, without factual backing or scientific proof. The housing crisis, the banking crisis, the automotive industry crisis, the climate change crisis, and now the health care crisis all focused on real problems, but hyperbole and exaggeration ruled the debate. Catastrophic consequences are predicted for inaction, and exaggerated results are guaranteed with Democrat intervention. The liberal MSM acted as a cheerleader during these phases of the policy debate, finding anecdotal evidence and writing puff pieces to support the need for action.

Legislation was then crafted that is so huge and complex that it is not understandable by the public or even the Congress, camouflaging government waste and over-reach at every turn. The Bailout bill was $700 Billion and passed without reading, and every major initiative afterwards was over 1,000 pages long, close to $1 Trillion, and unreadable. Once passed visible "low-hanging fruit" aspects are feted while insidious top-heavy bureaucracies are defined and staffed, with organization continuation and expansion as the primary mission. The "saved or created" jobs are a classic example of obfuscation to disguise a absence of any real positive results.

Now the MSM plays a vital role covering up initial results that fall well short of "expectations" and the financial justification erodes before our eyes. Never once does the MSM compare real versus actual results, or re-examine the business case, or question the ability to achieve the desired outcomes. The stimulus inability to create jobs and the inconsequential climate improvement promised by the "cap and trade" bill are conveniently ignored by the MSM. The Mainstream Media is an active co-conspirator to government greed and manipulation, hiding in plain sight, and has forfeited any credibility as a fair and balanced check and balance of power."

http://www.americanthinker.com/blog/2010/03/wonder_where_the_next_crisis_w.html

March 29, 2010 Posted by John at 6:59 PM

[W]ithout an effective mechanism of enforcing the individual mandate, the entire system is likely to collapse. (The individual mandate is the "third leg of the stool" as many a liberal has been pointing out for months.) Given that the bill also bans insurance companies from denying coverage based on pre-existing conditions, WHY WOULD ANYONE OBTAIN INSURANCE COVERAGE PRIOR TO NEEDING IT? This was already going to be a problem with the relatively low cost of the penalty, but take away any meaningful enforcement of it and it is a complete and total joke.

The net result will be an ever increasing shift of healthcare costs on to those who remain in the insurance system (or to tax payers), and possibly even the bankruptcy of the insurance industry.

Hmm. Bug or feature? We report, you decide. A reader writes:

Absolutely essential and fundamental to the very design of the Obamacare bill is the individual mandate to require purchase of prescribed health insurance. And yet in what is an amazingly revealing feature of the bill there is literally no provision for enforcement of the mandate. While this has been known for some time -- it was discussed a few weeks ago in NRO in the context of resistance or civil disobedience to the mandate -- it is only now getting the exposure it deserves.

As the linked article makes clear, while the bill does provide for fines to enforce the mandate through the income tax system....the IRS is explicitly prevented from collecting the fines by assessments, liens or seizures, no civil or criminal penalties attach to failure to pay such fines and no interest accrues from the date the fine is due!! This is actually amazing and cries out for explanation.

In my view, this is not the result of a simple oversight or error...quite the contrary. This is a feature, not a bug. We can be sure of this because they had to go to the trouble of specifying that enforcement was prohibited; silence would have meant that the normal IRS enforcement powers were available and presumed to be used to ensure that the mandate legislated by Congress was carried out. Normally the simplest explanation would involve stupidity, incompetence, error, haste or some other ordinary failure. In this case I think the explanation has to be, since it was intentionally put in the bill, that the architects of Obamacare intend that the individual mandate will fail....and guarantee it by actually affirmatively prohibiting enforcement.

Why would they do this? One reason is that, despite all the confident left wing bluster, they may very well be afraid that, given the extraordinary implications for the vast expansion of government power, the Supreme Court may well find, as they should, such a mandate to be unconstitutional. [Ed.: Unlikely, in my view.] That would undermine the whole program and is a complication that the Obama administration I am sure would prefer to avoid. As well as avoiding nasty scenes of property seizures or wage garnishments lack of enforcement would also prevent an individual desiring to make a test case from having standing to sue. (Why the approach taken by the Attorney General in Virginia in relying for standing on conflict of state and federal laws is clever.)

The real reason, I suspect, is more insidious -- quite simply to destroy the private health insurance industry and create an irresistible demand for expansion of the program to a public option and ultimately to single payer provision. It is undeniable that guaranteed issue of insurance at ordinary rates for those with preëxisting medical conditions is popular; but forcing insurance companies to cover them at average rates cannot possibly work unless healthy younger people are forced into the risk pool at rates higher than what their risk rating would otherwise be. Without the mandate, in other words, the insurance companies cannot possibly be viable and also cover preëxisting conditions at average premium rates.

Quite simply, Obamacare has created a ticking time bomb for the insurance industry. Those with preëxisting conditions will be covered.....and demand continuation of the coverage at prescribed rates....and those who ignore the mandate, presumably anybody at all affected by it, face no consequences. As costs spiral out of control, premiums will have to rise and subsidies increase. Insurance companies would have to either fold or shift costs....to those covered by employers....becoming a perfect target for left wing demagoguery and vilification. The only way out as more and more of those covered by employers get pushed into the exchanges as costs get shifted to them and employers no longer offer insurance -- yet another intended consequence -- is the public "option" or outright nationalization through a single payer plan.

We know that a single payer nationalized health care plan is the long term objective and intention for proponents of Obamacare and has been all along. They're completely disingenuous about how "incremental" and "modest" the program is. The astonishing fact that they deliberately prohibited enforcement of a critical component of the plan tells you all you need to know. It will intentionally create a crisis...a feature, not a bug....and a crisis is something this crowd never wants to go to waste."

http://www.powerlineblog.com/archives/2010/03/025954.php

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"Joint Committee on Taxation Confirms that ObamaCare Does Not Enforce Individual Mandate

One of the more controversial elements of ObamaCare is the mandate for most individuals to purchase insurance beginning in 2014. There is really no precedent for a federal mandate of this scale requiring individuals to purchase a product or service. So not surprisingly a number of state Attorney Generals have indicated they will be filing suit questioning the constitutionality of this provision.

Of course the individual mandate is also very risky from a political standpoint, as the Democrats who orchestrated the passage of this bill are mandating not only that the young and healthy obtain insurance, but also that even their most fervent liberal constituents must purchase this coverage from the “evil”, private insurance industry.

Republicans for their part have focused on the fact that this mandate will be enforced via threat of a financial penalty (or tax), with the added assumption that it is the dreaded IRS which will be enforcing this. And sure enough, it’s already been reported that the IRS anticipates hiring possibly in excess of 15,000 additional personnel to deal with the collection of the individual mandate, and other tax related provisions within the bill.

However, it turns out that the Democrats who crafted this bill significantly – and I mean significantly – hamstrung the ability of the IRS or any other federal agency to enforce or collect on this mandate. Here is what the federal Joint Committee on Taxation had to say about this issue in a report released earlier this week:

Individuals who fail to maintain minimum essential coverage in 2016 are subject to a penalty equal to the greater of: (1) 2.5 percent of household income in excess of the taxpayer’s household income for the taxable year over the threshold amount of income required for income tax return filing for that taxpayer under section 6012(a)(1);67 or (2) $695 per uninsured adult in the household. The fee for an uninsured individual under age 18 is one-half of the adult fee for an adult. The total household penalty may not exceed 300 percent of the per adult penalty ($2,085). The total annual household payment may not exceed the national average annual premium for bronze level health plan offered through the Exchange that year for the household size…

The penalty applies to any period the individual does not maintain minimum essential coverage and is determined monthly. The penalty is assessed through the Code and accounted for as an additional amount of Federal tax owed. However, it is not subject to the enforcement provisions of subtitle F of the Code. The use of liens and seizures otherwise authorized for collection of taxes does not apply to the collection of this penalty. Non-compliance with the personal responsibility requirement to have health coverage is not subject to criminal or civil penalties under the Code and interest does not accrue for failure to pay such assessments in a timely manner.

According to a footnote in the report, “subtitle F of the Code” is the portion of the tax code which grants the IRS the authority to assess and collect taxes. In other words, as the law is written the federal government has no legal authority to enforce this mandate, nor will it have any recourse to collect any penalties that go unpaid!

This issue was actually the subject of a very amusing exchange between Rep. Anthony Wiener and Bill O’Reilly on Wednesday. While the facts seem to vindicate Rep. Wiener who argued repeatedly that the bill would not criminalize non-compliance with the individual mandate, this is actually the worst possible news for those who believe in the merits of the mandate and the bill in general.

Because without an effective mechanism of enforcing the individual mandate, the entire system is likely to collapse. (The individual mandate is the “third leg of the stool” as many a liberal has been pointing out for months.) Given that the bill also bans insurance companies from denying coverage based on pre-existing conditions, WHY WOULD ANYONE OBTAIN INSURANCE COVERAGE PRIOR TO NEEDING IT? This was already going to be a problem with the relatively low cost of the penalty, but take away any meaningful enforcement of it and it is a complete and total joke.

The net result will be an ever increasing shift of healthcare costs on to those who remain in the insurance system (or to tax payers), and possibly even the bankruptcy of the insurance industry. Given all the double-talk the past year over the public option, and the demonizing of private insurers, it is hard not to wonder whether this was by design. But let’s give our Democratic friends the benefit of the doubt, in which case this represents an inexcusable level of incompetence from the people we have just entrusted with overseeing one-sixth of the economy. Nice job guys."

http://biggovernment.com/mrichmond/2010/03/26/joint-committee-on-taxation-confirms-that-obamacare-does-not-enforce-individual-mandate/

Submitted by Tyler Durden on 03/28/2010 14:27 -0500
Source Zero Hedge

"It couldn't have happened to a nicer country. On March 18, with very little pomp and circumstance, president Obama passed the most recent stimulus act, the $17.5 billion Hiring Incentives to Restore Employment Act (H.R. 2487), brilliantly goalseeked by the administration's millionaire cronies to abbreviate as HIRE. As it was merely the latest in an endless stream of acts destined to expand the government payroll to infinity, nobody cared about it, or actually read it. Because if anyone had read it, the act would have been known as the Capital Controls Act, as one of the lesser, but infinitely more important provisions on page 27, known as Offset Provisions - Subtitle A—Foreign Account Tax Compliance, institutes just that. In brief, the Provision requires that foreign banks not only withhold 30% of all outgoing capital flows (likely remitting the collection promptly back to the US Treasury) but also disclose the full details of non-exempt account-holders to the US and the IRS. And should this provision be deemed illegal by a given foreign nation's domestic laws (think Switzerland), well the foreign financial institution is required to close the account. It's the law. If you thought you could move your capital to the non-sequestration safety of non-US financial institutions, sorry you lose - the law now says so. Capital Controls are now here and are now fully enforced by the law.

Let's parse through the just passed law, which has been mentioned by exactly zero mainstream media outlets.

Here is the default new state of capital outflows:

(a) IN GENERAL.—The Internal Revenue Code of 1986 is amended by inserting after chapter 3 the following new chapter:

‘‘CHAPTER 4—TAXES TO ENFORCE REPORTING ON CERTAIN FOREIGN ACCOUNTS
‘‘Sec. 1471. Withholdable payments to foreign financial institutions.
‘‘Sec. 1472. Withholdable payments to other foreign entities.
‘‘Sec. 1473. Definitions.
‘‘Sec. 1474. Special rules.
‘‘SEC. 1471. WITHHOLDABLE PAYMENTS TO FOREIGN FINANCIAL INSTITUTIONS.

‘‘(a) IN GENERAL.—In the case of any withholdable payment to a foreign financial institution which does not meet the requirements of subsection (b), the withholding agent with respect to such payment shall deduct and withhold from such payment a tax equal to 30 percent of the amount of such payment.

Clarifying who this law applies to:

‘‘(C) in the case of any United States account maintained by such institution, to report on an annual basis the information described in subsection (c) with respect to such account,
‘‘(D) to deduct and withhold a tax equal to 30 percent of—

‘‘(i) any passthru payment which is made by such institution to a recalcitrant account holder or another foreign financial institution which does not meet the requirements of this subsection, and

‘‘(ii) in the case of any passthru payment which is made by such institution to a foreign financial institution which has in effect an election under paragraph (3) with respect to such payment, so much of such payment as is allocable to accounts held by recalcitrant account holders or foreign financial institutions which do not meet the requirements of this subsection.

What happens if this brand new law impinges and/or is in blatant contradiction with existing foreign laws?

‘‘(F) in any case in which any foreign law would (but for a waiver described in clause (i)) prevent the reporting of any information referred to in this subsection or subsection (c) with respect to any United States account maintained by such institution—

‘‘(i) to attempt to obtain a valid and effective waiver of such law from each holder of such account, and
‘‘(ii) if a waiver described in clause (i) is not obtained from each such holder within a reasonable period of time, to close such account.

Not only are capital flows now to be overseen and controlled by the government and the IRS, but holders of foreign accounts can kiss any semblance of privacy goodbye:

‘‘(c) INFORMATION REQUIRED TO BE REPORTED ON UNITED STATES ACCOUNTS.—
‘‘(1) IN GENERAL.—The agreement described in subsection (b) shall require the foreign financial institution to report the following with respect to each United States account maintained by such institution:
‘‘(A) The name, address, and TIN of each account holder which is a specified United States person and, in the case of any account holder which is a United States owned foreign entity, the name, address, and TIN of each substantial United States owner of such entity.
‘‘(B) The account number.
‘‘(C) The account balance or value (determined at such time and in such manner as the Secretary may provide).
‘‘(D) Except to the extent provided by the Secretary, the gross receipts and gross withdrawals or payments from the account (determined for such period and in such manner as the Secretary may provide).

The only exemption to the rule? If you hold the meager sum of $50,000 or less in foreign accounts.

‘‘(B) EXCEPTION FOR CERTAIN ACCOUNTS HELD BY INDIVIDUALS.—Unless the foreign financial institution elects to not have this subparagraph apply, such term shall not include any depository account maintained by such financial institution if—
‘‘(i) each holder of such account is a natural person,and
‘‘(ii) with respect to each holder of such account, the aggregate value of all depository accounts held (in whole or in part) by such holder and maintained by the same financial institution which maintains such account does not exceed $50,000.

And, while we are on the topic of definitions, here is how "financial account" is defined by the US:

‘‘(2) FINANCIAL ACCOUNT.—Except as otherwise provided by the Secretary, the term ‘financial account’ means, with respect to any financial institution—
‘‘(A) any depository account maintained by such financial institution,
‘‘(B) any custodial account maintained by such financial institution, and
‘‘(C) any equity or debt interest in such financial institution (other than interests which are regularly traded on an established securities market). Any equity or debt interest which constitutes a financial account under subparagraph (C) with respect to any financial institution shall be treated for purposes of this section as maintained by such financial institution.

In case you find you do not like to be subject to capital controls, you are now deemed a "Recalcitrant Account Holder."

‘‘(6) RECALCITRANT ACCOUNT HOLDER.—The term ‘recalcitrant account holder’ means any account holder which—
‘‘(A) fails to comply with reasonable requests for the information referred to in subsection (b)(1)(A) or (c)(1)(A),
or ‘‘(B) fails to provide a waiver described in subsection (b)(1)(F) upon request.

But guess what - if you are a foreign Central Bank, or if the Secretary determined that you are "a low risk for tax evasion" (unlike the Secretary himself) you still can do whatever the hell you want:

‘‘(f) EXCEPTION FOR CERTAIN PAYMENTS.—Subsection (a) shall not apply to any payment to the extent that the beneficial owner
of such payment is—
‘‘(1) any foreign government, any political subdivision of a foreign government, or any wholly owned agency or instrumentality of any one or more of the foregoing,
‘‘(2) any international organization or any wholly owned agency or instrumentality thereof,
‘‘(3) any foreign central bank of issue, or
‘‘(4) any other class of persons identified by the Secretary for purposes of this subsection as posing a low risk of tax evasion.

One thing we are confused about is whether this law is a preamble, or already incorporates, the flow of non-cash assets, such as commodities, and, thus, gold. If an account transfers, via physical or paper delivery, gold from a domestic account to a foreign one, we are not sure if the language deems this a 30% taxable transaction, although preliminary discussions with lawyers indicates this is likely the case.

And so the noose on capital mobility tightens, as very soon the only option US citizens have when it comes to investing their money, will be in government mandated retirement annuities, which will likely be the next step in the capital control escalation, which will culminate with every single free dollar required to be reinvested into the US, likely in the form of purchasing US Treasury emissions such as Treasuries, TIPS and other worthless pieces of paper. 

Congratulations bankrupt America - you are now one step closer to a thoroughly non-free market."

Full HIRE Act text:   http://www.zerohedge.com/sites/default/files/HIRE%20act.pdf

h/t Jørgen and Panama Investor Blog"

http://www.zerohedge.com/article/its-official-america-now-enforces-capital-controls