Friday, February 27, 2009
Obama Begins to Nationalize Healthcare: Wall Street Shocked, Shocked!
Now is the time to jumpstart job creation, re-start lending, and invest in areas like energy, health care, and education that will grow our economy, even as we make hard choices to bring our deficit down. That is what my economic agenda is designed to do, and that’s what I’d like to talk to you about tonight.
—President Barack Obama’s Address to a Joint Session of Congress, February 24, 2009
So began our President this past Tuesday night in a televised speech that apparently did not make it into the cable boxes of most healthcare investors, to judge by the reaction yesterday when details of that budget hit Wall Street.
Granted, it might have been that anybody who actually paid attention to what the President said were so stunned by the whopper near the top of the speech, when the President disclosed he would rely on Vice President Joe Biden to oversee the $787 billion stimulus plan, that they missed the healthcare discussion later on:
That is why I have asked Vice President Biden to lead a tough, unprecedented oversight effort – because nobody messes with Joe.
Now, Joe Biden has never been mistaken for Dick Cheney, or even Mickey Rourke, for that matter, as far as “messing with” goes.
Elected to the U.S. Senate four years out of law school, Biden hung his hat there for the next 35 years until, serendipitously, one of his various unsuccessful runs for President landed him on the Obama ticket, thanks to that distinguished Senator-like hair and those foreign relation credentials touted by Biden aids tired of hanging out in the Senate for three decades with nothing to show for it but big offices.
Contrary to the President’s remark, Biden has indeed been severely “messed with” during his career, most notably by Hillary Clinton and Obama himself during the recent Democratic primary campaign. Even after he made the ticket, Obama’s own staff” “messed with Joe,” keeping him and his weird, eliptical meanderings as far from television cameras and microphones as possible during the final days of the election.
Consequently, the President’s flight of fancy—that a 35-year Senate veteran and failed Presidential candidate with no actual working experience would effectively oversee a $787 billion spending package so that “not a dollar is wasted”—might have caused investors to miss an even bigger hint at what was coming down the pike, when the President discussed the bank bailout proposals:
I understand that on any given day, Wall Street may be more comforted by an approach that gives banks bailouts with no strings attached, and that holds nobody accountable for their reckless decisions.
This in-your-face throwing down of the gauntlet to Wall Street might have given investors a further clue that Obama was not necessarily aiming to be their best friend.
But if they did not pick up on it then, they certainly ought to have when the President pulled no punches discussing his healthcare plans:
For that same reason, we must also address the crushing cost of health care.
This is a cost that now causes a bankruptcy in America every thirty seconds. By the end of the year, it could cause 1.5 million Americans to lose their homes. In the last eight years, premiums have grown four times faster than wages. And in each of these years, one million more Americans have lost their health insurance. It is one of the major reasons why small businesses close their doors and corporations ship jobs overseas. And it’s one of the largest and fastest-growing parts of our budget.
Given these facts, we can no longer afford to put health care reform on hold.
Does this sound like a man on the side of fat-margined biotech companies and paper-shuffling HMOs?
Still, for some strange reason, Wall Street was shocked—shocked!—by the details in yesterday’s budget.
It seems that in order to provide more comprehensive coverage for Americans who can’t afford it, the budget looks to cut costs out of one of the most profitable industries on the planet.
Yesterday, investors read the fine print and reacted.
But they can’t say they weren’t warned.
I Am Not Making This Up
© 2008 NotMakingThisUp, LLC
The content contained in this blog represents the opinions of Mr. Matthews.
Mr. Matthews also acts as an advisor and clients advised by Mr. Matthews may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Matthews’ recommendations. This commentary in no way constitutes investment advice. It should never be relied on in making an investment decision, ever. Nor are these comments meant to be a solicitation of business in any way: such inquiries will not be responded to. This content is intended solely for the entertainment of the reader, and the author.
Posted by Jeff Matthews at 8:08 AM