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November 26, 2014     The Florala News
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November 26, 2014

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PAGE 4 THE FLORALA NEWS- WEDNESDAY, NOVEMBER 26, 2014 The Florala News' editorial section is intended to provide our readers and citizens as com- plete an opportunity to express themselves with as few restrictions as possible. Profanity, direct or implied, and attacks on one's person rather than on actions or deeds are not ac- ceptable. Publication on this page in NO WAY REFLECTS AGREEMENT OR ENDORSE- MENT BY THIS NEWSPAPER. f II I Seniors want comp ive ma among companies by Jim Martin Thank God the government doesn't run the cell- phone industry. If it did, phones would cost twice as much, be too heavy to carry, have rotary dials on them, and we'd still be paying for "roaming" minutes. We know this from an eternal economic truth: Government control gives us less market competition, leading to lousy products at higher cost. Which leads to the interesting case of Medi- care Part D. Otherwise knowrL as the Medicare prescription- drug program, Part D bucked the trend of govern- ment bloat and failure by introducing real consum- er choice and competition among providers to keep costs down. Unlike most government programs that underestimate costs, Part D was a revolution. Not only did it come in under budget, but expanded drug treatment helped lessen chronic medical con- ditions among seniors before necessitating much more expensive treatment. Much of that progress could be undone if the government does not take swift action to restore real competition and consumer choice to the Medi- care prescription-drug program. Politicians and bureaucrats have a tendency to meddle when not called upon, and when you couple their tinkering with unforeseen market developments, you begin to see how the innovations of Part D can quickly be lost, which is bad news both for seniors and tax- payers. The Part D program is now controlled by a few huge pharmacy-benefit managers, who themselves either control or are controlled by the pharmacies I CROSSWORD by John Hill, Ph.D. I Alabama Policy Institute With spiraling mandatory spending and re- duced tax revenues threatening to send one or both of the state's budgets into proration, the op- tions of raising additional income by establishing a compact with the Poarch Creek Indians or legal- izing a state-sponsored lottery are on the minds of Alabama's legislators. Using the refrain of "let the people decide"--the same one used by former Gov- ernor Don Siegelman 15 years ago in an attempt to legalize a Georgia-style education lottery--elected officials from Goat Hill and the Governor's Man- sion whohave historically been either neutral or opposed to such possibilities now see them as a way to generate revenue for the state. Montgomery will need plenty of revenue to keep its essential services going in 2015 given that the gap in the state's General Fund could be as large as $200 million. In addition to the possibil- ity of gambling revenues helping close that gap, there is a patriotic attractiveness that comes with the idea of "keeping Alabama gambling dollars in Alabama." Likewise, gambling supporters suggest there is a sense of rightness that would come from extracting an annual toll from the Poarch Creeks in exchange for allowing them to expand their gambling operations in the state. Sanctioning ei- ther of these ideas, though, may not produce the long-term, stable economic benefits legislators are counting on. First, gambling is not a "fix" for any state's economy. Despite the liberal use of "millions" (and even "billions" in some larger states) by gambling supporters to describe the monetary benefits of le- galizing casinos or a lottery, the amount of tax rev- enue that legalized gambling provides to states is relatively small. According to a 2010 report by the Rockefeller Institute, gambling-related revenues accounted for only 2.1% to 2.5% of total revenues between 1998 and 2009 for states with large-scale gambling. Alabama should expect nothing different if it le- galizes casinos or a lottery. Ifa compact was estab- lished with the Poarch Creeks that gave the state 10% of the tribe's casino revenues--which totaled $600 million in 2012--the $60 million that would be generated would pay for only 3.2% of the state's $1.8 billion General Fund budget. If the money was earmarked for schools, it would amount to only one percent of the state's Education Trust Fund, just enough to pay for 3.7 days of public education. In the same way, lotteries add very little to the bottom line of most states. According to the annu- al financial reports of lotteries in 2012, revenues from the average lottery covered about 3.6% of total state government expenditures. The actual benefit of lottery revenues offsetting essential state spend- ing is even smaller than this, as several states ear- mark large amounts of lottery revenues to college scholarship programs and other beneficiaries not The Florala News that fill the prescriptions. This has led to anti-com- petitive practices that, if practiced in any other part of the Medicare system, would be considered illegal Medicare fraud. When the Medicare prescription-drug program started, the pharmacies and the pharmacy-benefit managers were separate entities, and didn't collude for market share. Now, two huge pharmacy-benefit managers have either bought out, or been bought out, by big pharmacy chains (Express Scripts and CVS Caremark), and between them cover more than half of all pharmacy benefits' in the Medicare program. Add in the next two companies, and that market control climbs to 79 percent. How did the mega-pharmacy networks corner the Medicare market? By requiring seniors to use the networks' own marl-order pharmacies, and by cutting kickback deals with drug manufacturers. In fact, the Department of Labor is investigating these anti-competitive practices of the pharmacy networks, such as the pharmacy-benefit manag- ers charging Medicare more than 50 percent above what they reimburse the pharmacy that fills the prescription, pocketing the rest. We at the 60 Plus Association -- a nonpartisan seniors-advocacy group with a free-enterprise, less-government, lower-taxes approach to seniors issues -- think real competition can only be re- stored to Medicare by allowing full access to the small chain, community and independent phar- macies that make up more than a third of all of America's pharmacies. The government tried to restore such small-business access to the Medi- i otherwise covered by their General Fund. Second, gambling is not a stable source of rev- enue for states, as neither lotteries nor casinos are recession-proof. From the beginning of the Great Recession in 2008 to 2012, the typical lottery state saw the amount of lottery-generated revenues transferred to the state decline for an average of two years, with sixteen states reporting declines for three or more years. Similar losses in gam- bling-related tax revenue occurred in the same care prescription-drug program earher this year, but the big pharmacy:benefit managers and their Washington lobbyists were able to kill such com- mon-sense proposals by carpet-bombing Capitol Hill with lobbyists and money. Every other agency in the federal government is supposed to ensure that at least 36 percent of all federal contracts go to small business. Yet the Medicare prescription-drug program is exempted from that requirement. Why? The only reason we can think of is to protect the big pharmacy-network monopolies, sweetheart deals and windfall profits. If the election results this month taught Wash- ington anything, it's that supporting narrow and costly health care choices, aka Obamacare, can be costly to a politician's career. Seniors were a pow- erful voting bloc in the political wave, and were forceful in stating they want choice with regard to their health care options and keeping their doc- tor, a preference that magnifies the importance of getting Part D right. Seniors said "enough" of the meddling and tinkering and "enough" of Washing- ton picking financial winners and losers in the pre- scription-drug industry.When seniors called their representatives and senators, they were heard be- cause the phone service was not controlled by the government. Even the Poarch Creeks admit they cannot ex- pect to hve off of gambling revenues forever. In the words of Tim Martin, the President/CEO of the Creek Indian Enterprises Development Authority, "We work with the philosophy that gaming is going away--a little bit every day." If the most adamant supporters of casino gambhng in Alabama are di- versifying in anticipation of the day that gambling revenue will end, why should the Legislature be- lieve that legalized gambling will provide a steady source of income? Finally, the market for large-scale gambhng in the United States is already swamped. With 95% of Americans already living in lottery states, and most living within a few hours' drive of one or more of the 979 casinos scattered across the country, there is no reason tourists would come to Alabama to gamble. Only local income will be captured. Moreover, if casinos or a lottery were legalized to prevent Alabamians from gambling at venues in neighboring states, it would be an admission that it is Alabamians the gambling interests want to prey upon. Advertising expanded gambling or a statewide lottery as a short-term solution for Alabama's budget woes is disingenuous. Any gambling rev- enues realized by the state would constitute only a fraction of what is needed to close the gap in next year's budget, and then only if the economy con- tinued to improve. The conservative leadership in Montgomery which was solidly reelected only a few days ago should reject this attempt at a quick fix and consider other measures that both reign in spending and cut unnecessary costs over the long term. - Jim Martin is chairman of the 60 Plus Associa- tion. nn m 1 2 3 m =- - -.- 13 16 mn m 19 III 25 26 27 35-=.~ m m 40 ~m m II 58 59 five-year period in the twenty states with either | land-based, riverboatl or racetrack casinos, with seven states having yet to recover to their 2008 tax revenue levels. Moreover, because Alabama's per-capita income is lower than the national aver- age, fewer dollars could be expected to be played at gambling venues. Id Nh John Hill, Ph.D is senior policy analyst for the" Alabama Policy Institute (API), an independent non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families. If you would like to speak with the author, call (205) 870-9900 or email Make the Switch to Dish Today= and Save Up To 50% Call Now and Ask How/ 1-800-318-5121 Call 7 daysa week 8am - 11pro EST Promo Code: MB0113 ~C:, StatcPoint Media :: THEME: WORLD LEADERS ACROSS 1. Fictional elephant 6. Comprised or embodied 9. Attention grabber 13. Swelling 14. Possess 15. Corner joint 16. Moth- 17. Mauna,Hawaii 18. Be theatrical 19. *He arrived with a puff of smoke? 21. ".~ and ," 1992 Tom Cruise movie 23. *Former Haiti President, "Baby "Duvalier 24. To clean corn 25. Goon 28. Redecorate, e.g. 30. Vandalizing a car 35. Donkey sound 37. Push for something 39." de Lammermoor" 40. Fit of shivering 41. *He annexed most of Crimea 43. Cin COGS 44. 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