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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: nextrade! who wrote (16914)	2/7/2004 7:32:47 PM
From: nextrade!	Read Replies (1) \| Respond to of 306849

Credit Bubble Bulletin, by Doug Noland prudentbear.com

To: nextrade! who wrote (16914)	2/8/2004 11:25:38 AM
From: GraceZ	Read Replies (1) \| Respond to of 306849

is health care insurance available at this rate, anywhere in America ? I pay $4200/year for comprehensive health insurance for myself and my husband combined with a $500 deductible, 80/20 co-pay with a maximum out of pocket of $2500 per couple in any 14 month period. We're both approaching 50, for someone under 30 the plan would carry a lower premium than that especially with higher deductible and or larger maximum out of pocket. Considering that it is fully tax deductible (because I'm self employed) and we're in the 28% marginal bracket, the real after tax cost is $126.00/month for each of us, even while the pre-tax is $175/month. Self employment does carry some benefits. Here is someone who gets what I've been saying for years about how irrational people are about medical benefits. Most over pay, preferring dollar swap plans or taking a bigger hit to their income than the value of the benefits bought on the open market. techcentralstation.com I am not sure that I find this explanation convincing. Contrary to my training as an economist, I believe that at least some of the preference that workers have for in-kind benefits reflects flat-out irrationality. Even without tax arbitrage (and, after all, something like half the population pays no income tax and therefore does not even participate in tax arbitrage), many workers would choose to receive $4000 in health insurance rather than take $5000 in salary, even though the latter would allow them to buy health insurance and have $1000 left over. (See my earlier essay, America is Crazy.) In a world with rational workers, and certainly in such a world without tax distortions, companies with "good benefits" would be shunned in favor of companies that paid better salaries. Company benefits would disappear. As it is, the oxymoron of company benefits seems to fool most people. What is interesting is that workers are not naturally suspicious of companies that pay "good benefits." Apparently, most people believe that "good benefits" reflect generosity and sharing by the company, rather than a shrewd, calculated effort to save on compensation costs. My guess is that the people who see through the scam of "good benefits" tend to gravitate toward self-employment, which allows them to take their payments in cash and buy benefits themselves.