Urgent Letter to the Deal-Maker-in-Chief

Here’s the deal of the century! Single-payer, universal health care. You can call it “Tremendous Trumpcare” and be a hero.

May 9, 2017

The White House
1600 Pennsylvania Avenue N.W.
Washington, D.C. 20500

Dear Mr. President,

Here is something that will prove your deal-making ability:  single-payer, universal healthcare.  It will make you an American hero.

Health care expenditures represent more than one-sixth of the national economy.  Fixing the system will have wide-ranging and profoundly positive effects on the whole country.

Put your deal-making foot down. Cut through the confusing rhetoric of “rights” versus “privileges.”  Ignore the callous, anti-government “Freedom Caucus.”

From a business and transactional perspective, a single-payer, universal health care system is just the right thing to do.  Here are some of the main reasons:

Better health. Americans would take better care of themselves.  Attention would shift to prevention and away from last-minute, more-expensive emergency care.

More productivity.  A healthier, more hopeful populace would be a huge boost to national productivity.  As the fight rages over the ACA and the AHCA, lives are lost and families are ruined.  Health care expense is the leading cause of personal bankruptcy. Our national neglect has led to other problems that continue to mount—like mental illness, homelessness and despair—problems that affect all of us directly or indirectly.

Higher efficiency.  A single-payer system would have more leverage to bring down health care costs (especially for pharmaceuticals!) and would eliminate the duplicative overhead of the current, reverse-dog-pile of 1,300 profit-taking insurance companies. There would be an immediate savings of more than $350 billion of duplicative overhead cost, waste and insurance company profit-taking.

Job creation.  A single-payer system will ease the health insurance burden of American employers.  With higher employee productivity and lower corporate costs, profits will rise and more jobs will be created.

Lower, simpler taxes.  Over time, with the elimination of redundant overhead, greater efficiency, lower health care costs and risk spreading among the whole populace, the direct and indirect taxes and costs associated with health care and health insurance will come down.  The tax code will be simplified.

Freedom.  A single-payer, universal system rationalizes pricing and puts health care decision-making back in the hands of health care providers and their patients, and removes it from the profit-driven bureaucracy of insurance company MBAs and administrators.

Apply your vaunted deal-making prowess to eliminating the inefficiency, exploitation and waste of our American health care system.

Time is of the essence.  Among the millions of Americans still without health insurance, at least 120 are dying every day.

Thank you in advance,

JERRYSIG200

“Like Watching the Bombing of a Hospital in Slow Motion”

“Repeal and replace” in the form of the American Health Care Act promises to be a human and political disaster.

The American Health Care Act (aka “AHCA,” “Repeal and Replace,” “Trumpcare,” “Ryancare”) is a human and political tragedy unfolding before our very eyes.  The manner by which it narrowly passed the House this week is an outrage and if you are not angry, you should be.  And if you don’t think you should be, you have not studied the issues and/or you have been misled by the White House and Republican propaganda.

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In summary, a social program popular with the majority of Americans, a program that has helped tens of millions of previously uninsured Americans have access to health insurance and better care and, but for the Republican efforts to defeat it, would continue to do the same, would be replaced by the current administration and 217 Republican members of the House of Representatives with this horrid and inhumane piece of legislation.

It’s like watching the bombing of a hospital in slow motion.

These Republicans were flogged by a President desperate for a victory, although “victory” is a strong word for such a slim margin and such obvious partisanship. 170504144054-ahca-vote-tally-0504-graphic-super-169

This set of heartless Republican Representatives hurtled ahead in the face of opposition by virtually every health care provider–doctors, nurses, hospitals–and even insurance companies. No public hearings. No Congressional Budget Office analysis.

There is no dispute that the AHCA, as it currently stands, will lead to at least 24 million people losing health insurance.  And that is a conservative estimate.

There is also no dispute that the AHCA, as written, promises the already-rich another gift of lower taxes, to further widen the ever-increasing income and wealth inequality in our country.  “Wealth Care.”

AHCA

Sadly, our own Idaho Congressmen, Simpson and Labrador, both voted in favor of the AHCA.  Labrador, not a surprise, but Simpson too. (Mike! Really?)

President Trump will propagandize this victory, but it can only be a victory for him and his rich friends. Newt Gingrich has called it the “art of the deal,” but this is dark art and a bad deal.

The 217 have kicked their rotten can down the road, to the Senate. Pray that our Senators show more wisdom and will reject or fix this mess.

Meanwhile, as we look forward to the 2018 House races, let’s remember the callousness and recklessness supported by these 217 Republican lemmings, including the two from Idaho.

 

Tax Cuts and Drip-Drip Economics

Idaho Trump voters take note:
The Trump tax plan, as announced, is clear proof that a vote for Trump was a vote for making the already-rich richer.

Political issue: 'national debt' concept. Photo realistic sign, isolated

The Trump proposed tax cuts, which promise to add trillions to the national debt, must be putting our Idaho federal delegation in a real bind. They have consistently campaigned on the traditional Republican planks of reducing deficits and the national debt.

Surely, our Idaho Senators and Congressmen will oppose the Trump tax plan.

Rolling out the plan this week was another 100-day trick, supported with the usual marketing hyperbole and unusually-bad economic analysis.

Here are at least three of the falsehoods behind this maneuver.

Falsehood #1: US companies are uncompetitive because of the high US corporate tax rate.

The statutory tax rate may be high compared to other countries, but the actual (or “effective”) tax rate for US corporations is always lower, after the many deductions and loopholes available to American businesses.

More specifically, the statutory tax rate is 35%, but after exclusions and deductions, the effective rate is, more-often-than-not, zero percent (0%). A March 2016 Government Accounting Office (GAO) report shows that most US corporations paid no taxes between 2006 and 2012.

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Falsehood #2: Lower corporate taxes will stimulate economic growth.

This argument is based on the same faulty economic logic that justified the Reagan and Bush era tax cuts. That logic was (and is) that tax benefits for corporations and the rich will “trickle down” to the poor.

However, trickle-down economics has never worked in the real world and would better be described as “drip-drip economics.” Tax savings for corporations and their owners will more likely make their way into bigger homes, private jets and longer yachts, with little if any broad-based economic boost for everyone else.  Meanwhile, the national debt will skyrocket.

In his “Cross of Gold” speech, Democratic candidate William Jennings Bryan proclaimed:

“There are two ideas of government. There are those who believe that if you just legislate to make the well-to-do prosperous, that their prosperity will leak through [trickle down] on those below. The Democratic idea has been that if you legislate to make the masses prosperous their prosperity will find its way up and through every class that rests upon it.”

Falsehood #3: The middle class will benefit from the tax cuts.

OK, sure, this sounds good. Who would not want a tax cut?  But who really benefits?

The already rich population will benefit most. Trump’s promises to the middle class amount to pandering to the non-rich to give greatest advantage to the already-rich.

Among the most-advantaged beneficiaries will be the Trumps, his cabinet members and his circle of super-rich friends and advisors.

Yesterday’s New York Times editorial page summarized it well:

“Regardless of the plan’s fate, Mr. Trump has already sent a strong message about where his sympathies really lie. They lie not with the working people who elected him, but with the plutocracy that envelops him.”

“CSRs, We’re Not Doing That!”

The Affordable Care Act and healthcare for low-income families are held hostage as a Republican-controlled White House and Congress lunge for “victories.”

The newest “repeal and replace” healthcare plan will NOT be voted on today. Hurray! What a relief—for now.

Unfortunately, the Affordable Care Act remains in the hands of its enemies and they have shown they are willing to hold it and its beneficiaries hostage.

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A few days ago, the White House proposed an exchange of payments for President Trump’s wall for continued funding of the Cost-Sharing Reduction payments (CSRs) provided for in the Affordable Care Act. The administration said, in so many words, “For each dollar towards President Trump’s wall, we will not stop a dollar of Obamacare CSR funding.”

Stated otherwise, “we will not make health insurance unaffordable, if you will pay for the wall.”

CSRs are government subsidies provided for in the Affordable Care Act. They are paid to insurance companies to offset the cost of insurance for low-income families. Without CSR payments, health insurance for those families would be unaffordable.

The proposed “deal” (or threat) was met with immediate, negative political and industrial response. As a result, President Trump backed off both wall funding and the withholding of CSR funding—for now.

Republican hostility for the Affordable Care Act remains and the withholding of CSR funding is just one of the several tools in Republican hands to promote their self-fulfilling prophecy of “implosion.”

With the Trump administration, and a Republican-controlled Congress, it is hard to see this ending well for low-income families in need of health insurance. It has been made clear that political victories (and walls) are more important than American lives.

Resistance should remain on high-alert.

“You gotta knock the hell out of them — Boom! Boom! Boom!”

It’s amazing how blowing things up in the middle of nowhere can cover your faults and boost your reputation.

“If you look at what’s happened over the last eight weeks and compare that really to what’s happened over the past eight years, you’ll see there’s a tremendous difference, tremendous difference,” Trump told reporters after the military unleashed [the 22,000 pound “Mother of All Bombs”] on a largely unpopulated region of the Afghan wilderness. “This was another very, very successful mission.”

Washington Post, April 14, 2017

DISCLAIMER: THIS STORY WAS TOLD TO ME BY AN OLD FRIEND. I WAS NOT INVOLVED. IT REMINDS ME OF RECENT EVENTS—SERIOUSLY.

It was a hot summer night in a Western, sagebrush-covered desert. Another weekend gathering of “the guys,” high school boys, drinking beer away from the attention of parents and police.

This was the Pre-Game-Boy Era, when testosterone-infected young men competed with cars, guns, beer—and things that go “BOOM!”

On this particular night, around a blazing fire built in a remote clearing that had for years been the regular “drinking spot,” testosterone needles jumped when one of the guys showed up with his dad’s new Oldsmobile and a stick of dynamite.

oldsmobileDynamite

DISCLAIMER: I DO NOT CONDONE WHAT HAPPENED NEXT.

One genius among the young, beery group suggested connecting the dynamite to a jackrabbit—the desert was full of them—and went to his pickup for a roll of duct tape. The rest of the guys eagerly went looking for a jackrabbit.

Black-tailed Jackrabbit Sniffing

After surrounding and grabbing a stringy male, the boys strapped the red stick to its back, like a rocket pack, and lit the fuse. The poor panic-stricken animal jetted away into the dry sagebrush darkness, trailing the sparks of the burning fuse.

The group howled in delight and the kid with dad’s new car felt proud of his accomplishment—manly and more accepted by his peers for this extraordinary, albeit impetuous and inhumane, show of manhood.

Burning fuse on black background

Everyone leaned forward, in anticipation of the blast. But then–“HOLY S#%T!”–the jackrabbit suddenly veered back, out of the sagebrush, toward the group.  Everyone screamed and ran for cover.

The rabbit found cover too, moments before the blast—under dad’s new Oldsmobile.

“KA-BOOM!”

LESSON: BLOWING THINGS UP IN DESERTS (OR MOUNTAINS) CAN HAVE UNINTENDED CONSEQUENCES.  IMPETUOSITY AND SHOWMANSHIP, WITHOUT A STRATEGY, ARE DANGEROUS.

“Lady, Obamacare sucks only because you think it sucks!”

Conservative Republicans have done their best to convince us Obamacare is a failure, even though conservatives designed the very Obamacare mechanisms they now vilify.

We were at our cabin in the mountains on Fourth of July.  Someone, I think it was me, had brought fireworks. We began to set them off.

The rest of the family was gathered around in lawn chairs, except for my mother in law, who, because of her Parkinson’s Disease, was in a wheelchair.

Mid-firework, a Deputy Sheriff suddenly emerged from the darkness. She had seen our celebration from the road. “There’s a fire hazard warning in effect,” she said. “Stop it with the fireworks!”

My automatic reaction, when the sheriff first appeared, was to toss the remaining fireworks into my mother-in-law’s lap, just in case someone might get arrested.

I am reminded of this embarrassing moment as I listen to the “repeal and replace” debate.

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For all the Republican chest beating and finger pointing, it is at least ironic that the mandates, penalties and subsidies that became part of Obamacare were first proposed by conservatives, principally the Heritage Foundation (a conservative “think tank”) and that they were adopted with success into “Romneycare” in Massachusetts.  (Remember that “tar baby”?)

The conservative genealogy of mandates, penalties and subsidies enhanced the likelihood of passage of Obamacare. However, this resulted in an unpolished political amalgam of concessions and compromises, a sort of Rube Goldberg combination of government interventions and free-market “invisible hands.”

The Republicans have since consistently tossed the problems of these mechanisms into the laps of the Democrats–with hyperbolic rhetoric, the 60 or more attempts to repeal, the first Executive Order of the new administration, and now the Republican intimidation from President Trump and the Koch brothers (ouch!  double whammy!).

The effort to repeal and replace Obamacare with Trumpcare (and now the right-wing flanking move against Trumpcare), highlight three conflicting sets of ideas, in increasing order of conservatism.

  • Least conservative is the view that our healthcare system should take care of everyone who needs health care and that market mechanisms should be regulated to reach that result.  Financial aid should be available to help those in need.  (This is “conservative” in contrast to the “liberal” idea of government-sponsored universal health care.)
  • More conservative is government regulation, but less of it, and financial assistance, but not so generous.
  • Most conservative is the approach that government should stay the hell out of health care, and just about everything else. No regulation. No assistance. Health care goods and services left to unregulated, “free” markets.

The first set of ideas explains Obamacare, with its conservative imprint. The second is Trumpcare, as presented to the House today. The third sheds light on the internecine opposition from the far-right. It also reflects the system (or lack thereof) prior to Obamacare.

Sure, Obamacare got off to a rough start, but it has had to drag the anchors of Republican opposition. Nonetheless, it has made material progress toward implementation of outcomes we should all agree on: making health care more affordable and more available to more people.

children in white bath tub on white backgroundIn its short six years, Obamacare has done that. More than 20 million more people are insured. Premiums have risen less quickly than they would have without Obamacare–although there are surely exceptions that deserve to be fixed.

Throwing out this progress is like throwing out babies with bathwater.

And here is something else, lost in the “repeal and replace” hubbub: individual health insurance costs will continue to rise as long as the costs of health care goods and services continue to rise.

Maybe we should focus on that.

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“Medicare for Everyone!”

If you think profit taking in the areas of accident and disease is wrong, if you support efficiency and if you believe we all do better if more people have access to health care, you should agree that Medicare for everyone is a good idea.

The Problems Caused by Healthcare Reform

Step back.  Look at us.  Trumpcare versus Obamacare?  Obamacare versus Trumpcare? We are fighting over competing approaches to the same problems–and ignoring a solution that would be better than both combined.  Medicare.

No matter what, we need a better solution, and quick. While Congress continues its political tug-of-war, we are suffering, individually and as a country. We spend more and get less. The system is rife with inefficiency. Tens of millions are still without health insurance, and tens of millions more stand to lose it. People are dying.

We spend more and get less. Of all the countries in the world, the US spends the most on healthcare (and health insurance), yet health outcomes here are worse. Our average life expectancy is shorter and we have more chronic health problems.

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Medical goods and services are more expensive here. Citizens of other countries are charged far less. For example, an MRI in Switzerland is is ten times (10x) cheaper. Canadians pay at least half as much for medicine.

So we tend to put off taking care of ourselves. Sound familiar? Americans visit the doctor less often, even though an annual checkup and other preventative measures could avoid problems or catch them early. Or even save your life. If you are like me, this has too often been about saving money–with the hope/fantasy that the problem will go away.

And, as a group, we and the politicians are downright dumb. As a country, we spend less on social services than other countries, even though a few dollars for things like clothes and shelter could reduce chronic and expensive health issues among the most vulnerable members of our society. And face it, everyone else, including you and me, ends up paying for unpaid emergency health care, through rate or tax increases. In this case, an ounce of prevention really would be worth a pound of cure.

Oh, and by the way, of the 13 countries shown in the chart above, ours is the only one without a publicly financed or mandated health care system that assures coverage for all its citizens.

Are we fighting over wrong solutions? Market-centric mechanisms common to both Obamacare and Trumpcare fail to care for everyone and lead to economic exploitation. As argued in previous posts, free markets do not perform well in the health care arena.

I have already given examples of exploitation, with fabulous sums extracted by health insurance providers like Aetna and Humana. Under Obamacare, those two companies alone distributed around $22.0 billion to shareholders. They will do even for better for their shareholders in the years to come, particularly if Trumpcare becomes the law.

And then there’s the inefficiency of this whole dog pile of insurance providers. Massive duplication of overhead expenses–identified in accounting as “Selling and General Administrative Expense.” (Think of stuff like management salaries, marketing and rent. Then think of competing insurance company each paying these kinds of costs, over and over and over again.)

Looking at just Aetna and Humana again as examples: Since 2010, under Obamacare, Aetna reported around $60.5 billion of Selling and General Administrative Expense. During this same period, Humana spent around $44.0 billion, for a combined total of over $104.0 billion.  That’s a lot of overhead, and that’s just two companies.

Aetna and Humana argued that their combination would achieve efficiencies known euphemistically as “economies of scale” (aka “people losing their jobs”). Nonetheless, eliminating just one $15 million/year CEO could create savings that would pay for a lot of health care.

If you believe accident and disease are not conditions to be exploited by the “free market,” if you agree that squeezing some of the redundant costs out of the system is a good idea, and if you agree that more people having access to health care and taking care of themselves would be good for our whole society, you should want the efficiency and accessibility of a “single-payer” system.

Like Medicare.  For everyone.

Medicare Green Road Sign Over Dramatic Clouds and Sky.

 

For comparative country statistics, see this report: Squires & Anderson, “U.S. Health Care from a Global Perspective: Spending, Use of Services, Prices, and Health in 13 Countries,” Issues in International Health Policy, The Commonwealth Fund (Oct 2015) at http://www.commonwealthfund.org/publications/