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Financial skeptic

Notes on "neoliberalism enforced" cruise to Frugality Island for 401K Lemmings

News Neoliberalism as a New Form of Corporatism Recommended Links Peak cheap Energy and Oil Price Slump Secular Stagnation under Neoliberalism Rational Fools vs. Efficient Crooks: The efficient m hypothesis Casino Capitalism
Insufficient Retirement Funds as Immanent Problem of Neoliberal Regime Neoliberal Attacks on Social Security Unemployment Inflation vs. Deflation Coming Bond Squeeze Notes on 401K plans Vanguard
401K Investing Webliography Retirement scams Stock Market as a Ponzy scheme Financial Sector Induced Systemic Instability Neoclassical Pseudo Theories The Great Stagnation Investing in Vanguard Mutual Funds and ETFs
OIL ETNs Peak Cheap Energy and Oil Price Slump Notes on 100-your age investment strategy behavior in rigged markets Chasing a trade The Possibility Of No Mean Reversion Junk Bonds For 401K Investors Tax policies
John Kenneth Galbraith The Roads We Take Economics Bookshelf Who Rules America Financial Quotes Financial Humor Etc

“When the capital development of a country becomes a by-product
of the activities of a casino, the job is likely to be ill-done.”

John Maynard Keynes

"Life is a school of probabilities."

Walter Bagehot

Neoliberal economics (aka casino capitalism) function from one crash to another. Risk is pervasively underpriced under neoliberal system, resulting in bubbles small and large which hit the economy periodically. The problem are not strictly economical or political. They are ideological. Like a country which adopted a certain religion follows a certain path, The USA behaviour after adoption of neoliberalism somewhat correlate with the behaviour of alcoholic who decided to booze himself to death. The difference is that debt is used instead of booze.

Hypertrophied role of financial sector under neoliberalism introduces strong positive feedback look into the economic system making the whole system unstable. Any attempts to put some sand into the wheels in the form of increasing transaction costs or jailing some overzealous bankers or hedge fund managers are blocked by political power of financial oligarchy, which is the actual ruling class under neoliberalism for ordinary investor (who are dragged into stock market by his/her 401K) this in for a very bumpy ride. I managed to observe just two two financial crashed under liberalism (in 2000 and 2008) out of probably four (Savings and loan crisis was probably the first neoliberal crisis). The next crash is given, taking into account that hypertrophied role of financial sector did not changes neither after dot-com crisis of 200-2002 not after 2008 crisis (it is unclear when and if it ended; in any case it was long getting the name of "Great Recession").

Timing of the next crisis is anybody's guess but it might well be closer then we assume. As Mark Twain aptly observed: "A thing long expected takes the form of the unexpected when at last it comes" ;-):

This morning that meant a stream of thoughts triggered by Paul Krugman’s most recent op-ed, particularly this:

Most of all, the vast riches being earned — or maybe that should be “earned” — in our bloated financial industry undermined our sense of reality and degraded our judgment.

Think of the way almost everyone important missed the warning signs of an impending crisis. How was that possible? How, for example, could Alan Greenspan have declared, just a few years ago, that “the financial system as a whole has become more resilient” — thanks to derivatives, no less? The answer, I believe, is that there’s an innate tendency on the part of even the elite to idolize men who are making a lot of money, and assume that they know what they’re doing.

As most 401K investors are brainwashing into being "over bullish", this page is strongly bearish in "perma-bear" fashion in order to serve as an antidote to "Barrons" style cheerleading. Funny, but this page is accessed mostly during periods of economic uncertainty. At least this was the case during the last two financial crisis(2000 and 2008). No so much during good times: the number of visits drops to below 1K a month.

Still I hope it plays a small but important role: to warn about excessive risk taking by 401K investors in neoliberal economic system. It designed to serve as a warning sign and inject a skeptical note into MSM coverage. There are not many such sites, so a warning about danger of taking excessive risk in 401K accounts under neoliberalism has definite value. The following cartoon from 2008 illustrated this point nicely

As far as I know lot of 401K investors are 100% or almost 100% invested at stocks. Including many of my friends. I came across a very relevant to this situation joke which nicely illustrated the ideas of this page:

Seven habits that help produce the anything-but-efficient markets that rule the world by Paul Krugman in Fortune.

1. Think short term.
2. Be greedy.
3. Believe in the greater fool
4. Run with the herd.
5. Overgeneralize
6. Be trendy
7. Play with other people's money

I would like to stress again that it is very difficult to "guess" when the next wave of crisis stikes us: "A thing long expected takes the form of the unexpected when at last it comes".

But mispricing of risk in 401K accounts is systemic for "overbullish" 401 investors, who expect that they will be able to jusp of the train in time, before the crash. Usually such expectations are false. And to sell in the market that can lose 10% in one day is not easy psychologically. I remember my feelings in 2001-2002 and again 2008-2009. That's why many people who planned to "jump" stay put and can temporarily lose 30 to 50% of value of their 401k account in a very short period of time (and if you think that S&P500 can't return to 1000, think again; its all depends on FED). At this point some freak out and sell their holdings making paper losses permanent.

Even for those who weathered the storm and held to their stock holdings, it is important to understand that paper losses were eliminated mostly by Fed money printing. As such risks remains as at one point FED might find itself out of ammunition. The fact that S&P500 recovered very nicely it does not diminish the risk of such behavior. There is no guarantee that the third crisis will behave like previous two.

Next crash will have a new key determinant: the attitude toward the US government (and here I mean the current government of Barack Obama) and Wall Street after 2008 is the lack of trust. That means that you need to hope for the best but prepare for the worst. Injection on so much money into financial system was a novel experiment which is not ended yet. So how it will end is anybody's guess. We are now in uncharted waters. I think when Putin called Bernanke a hooligan, he meant exactly this. Since Bernanke was printing money out of thin air to buy financial paper, his action were tantamount to shoplifting. In some way this probably is more similar to running meth labs inside Fed building. The system was injected with narcotics. Everybody felt better, but the mechanism behind it was not healthy.

The complexity of modern financial system is tremendous and how all those new financial instruments will behave under a new stress is unknown. At the same time in the Internet age we, the great unwashed masses, can't be keep in complete obscurity like in good old time. Many now know ( or at least suspect ) that the neoliberal "show must goes on" after 2008 is actually going strongly at their expense. And while open rebellion is impossible, that results in lack of trust which represents a problem for financial oligarchy which rules the country. The poor working slobs are told be grateful for Walmart's low (poverty-subsidized) prices. Middle class is told that their declining standard of living is a natural result of their lack of competitiveness in the market place. Classic "bread and circuses" policy still works but for how long it will continue to work it is unclear.

But nothing is really new under the sun. To more and more people it is now clear that today the US is trying to stave off the inevitable decline by resorting to all kinds of financial manipulations like previous empires; yesterday, it was the British Empire and if you go further back, you get the USSR, Hapsburg empire, Imperial Russia, Spanish empire, Venetian empire, Byzantium and Roman empire. The current "Secretary of Imperial Wars" (aka Secretary of Defense) Ashton Baldwin Carter is pretty open about this:

“We already see countries in the region trying to carve up these markets…forging many separate trade agreements in recent years, some based on pressure and special arrangements…. Agreements that…..leave us on the sidelines. That risks America’s access to these growing markets. We must all decide if we are going to let that happen. If we’re going to help boost our exports and our economy…and cement our influence and leadership in the fastest-growing region in the world; or if, instead, we’re going to take ourselves out of the game.”

For the US elite it might be a time to rethink its neocon stance due to which the US is exposing ourselves to the enmity of the rising economic powers, and blowing serious cash to maintain it hegemony via maintaining huge military budget, financing wars and color revolutions in distant countries. In a way the US foreign policy became a financial racket, and racket can't last forever because it incite strong opposition from other countries.

Neoliberalism (aka casino capitalism) as a social system entered the state of decline after 2008. Like communism before it stopped to be attractive to people. But unlike communism it proved to have greater staying power, surviving in zombie state as finanfial institutions preserved political power and in some cases even enhanced it. It is unclear how long it will say in this state. Much depends on the availability of "cheap oil" on which neoliberal globalization is based.

But the plausible hypothesis is that this social system like socialism in xUSSR space before entered down slope and might well be on its way to the cliff. Attempts to neo-colonize other states by the West became less successful and more costly (Compare Ukraine, Libya and Iraq with previous instances of color revolutions). Some became close to XIX century colonial conquests with a lot of bloodshed (from half million to over a million of Iraqis, by different estimates, died ). As always this is mainly the blood of locals, which is cheap.

Libya and Ukraine are two recent examples. Both countries are now destroyed (which might be the plan). In Ukraine population is thrown in object poverty with income of less that $5 a day for the majority of population. And there is no other way to expand markets but to try to "neo-colonize" new countries by putting them into ominous level of debt while exporting goods to the population on credit. That is not a long term strategy as Greece, Bulgaria, and now Spain and Portugal had shown. With shrinking markets stability of capitalism in general and neoliberalism in particular might decrease.

Several researchers points to increased importance Central banks now play in maintaining of the stability of the banking system. That's already a reversal of neoliberal dogma about free (read "unregulated") markets. Actually the tale about "free markets", as far as the USA is concerned, actually was from the very beginning mainly the product designed for export (read about Washington consensus).

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[Mar 26, 2017] In addition to the public option and age 55+ Medicare buy-in, one thing that might work is abollishing the mandate and penalty and replaciing them with automatic enrollment. Call it Youre employed, youre covered!

Mar 26, 2017 | economistsview.typepad.com
New Deal democrat -> Lee A. Arnold ...

One issue going forward is whether the Dems should offer their own plan. I think they should.

As a few others have pointed out, Trump is not wedded to the GOP establishment. If he thinks he can "WIN bigly!" by allying with Dems, he will do so. I happen to think that he is mainly against "Obamacare" because Obama humiliated him at the White House Correspondents' Dinner once upon a time, and he is nothing if not vengeful. He wants to obliterate Obama's legacy.

So Dems need to make a big stink any time Trump administrativley undercuts Obamacare provisions to try to make it fail. But also they should give him the chance to do something he can call Trumpcare that actually works.

Obamacare does have some major problems (the individual mandate is hated, and the penalty isn't big enough. More young people need to buy in. Some of the Exchanges and health care provider networks are too narrow.

In addition to the "public option" and age 55+ Medicare buy-in, one thing that might work is abollishing the mandate and penalty and replaciing them with automatic enrollment. Call it "You're employed, you're covered!"

Just like SS, Medicare, unemployment and disability deductions to paychecks, establish a Health Care automatic deductible. If your employer offers healthcare, the deductible is reduced by the amount of the premium, all the way to zero if applicable.
If your employer doesn't offer healthcare, if you are under age 40, you are automatically enrolled in the least expensive Bronze plan in your state. If you are 40 or older, you are automatically enrolled in the least expensive Silver plan in your state.

The deductible would also include a small contribution towards Medicaid. Then, if you are unemployed, you are automatically enrolled in Medicaid, but can continue with the silver or bronze plan as above if you choose.

Dems could turmpet such a plan to "Reform and Improve" Obamacare, and campaign on pushing for it if they get a Congressional majority. Call it Trumpcare and President Caligula might sign on.

Reply Saturday, March 25, 2017 at 07:35 AM Lee A. Arnold , March 25, 2017 at 04:48 AM
"Medicare for all" may be the best battle cry. 65-70% of the U.S. people want a single-payer. Bernie Sanders has effectively destroyed the old Democratic Party and sits in a commanding position as spokesman, he gets 6 TV cameras with an hour's notice and he is probably the most popular politician in the U.S. The Democrats don't have to push it for now, they can wait for news to develop. This is all on the Republicans. Let the managerial disaster of Trump and the utter immorality of the "Freedom Caucus" sink in a little more, this story has "legs" as they say in show biz.
mulp -> Lee A. Arnold ... , March 25, 2017 at 04:48 AM
Name the Senators, representatives, and governors Bernie Bros have delivered?

Where are the Bernie Bros Newts, Cruz, Marcos, ...?

I'm in my 70th year. Conservatives attacked liberals in the 60s, my youth, as promising free lunches to gain power. But what they really hated was liberals convinced voters to tax all voters to pay for the things most voters wanted everyone to have, BASED ON SOUND ECONOMICS TO MAXIMIZE EFFICIENCY AND WELFARE.

Friedman led the effort to distort theory to eliminate the broad meaning of general welfare in economics. He did it by eliminating the hard connection between labor cost and gdp. He argued that labor costs and consumption can be cut to increase profits, and that contrary to theory, higher profits is more efficient.

Laffer applied operations theory to taxes, as if government was taxing to maximize profits.

Thus supply side theory of profit maximization. The result delivered was the imperative to cut taxes. To cut labor costs. Thus they argued that every economic measure improves if taxes and wages are cut.

Reaganomics would deliver more stuff at lower cost, higher profut, and that makes everyone better off, especially those in poverty. Friedman saw consumption as a bad thing. He wanted higher gdp, less consumption. In other words, he rewrote Adam Smith attack on mercantile economics into a justification of returning to mercantile economic policy.

So, who do Bernie Bros offer as the Milton Friedman and Laffer to create an intellectual foundation to refute Adam Smith, FDR, Keynes, Galbraith, are return to hunter gatherer economics? Who is the economist who can convince us that Marxist economic theory will work, as long as it's not captured by right wing capitalists like Fidel Castro, Chavez, Stalin, Lenin, the founders of Israel, ....

Bernie certainly must be influenced by the same economic theory that created Israel. It grew from the same Marxist roots in Germany that powered Stalin and Lenin. Bernie is a pre-WWII Zionist as best I can tell.

Why wouldn't Bernie deliver Israel governance to the US? How would he prevent the greedy from joining the Movement?

And Israel has the social welfare state system Bernie wants. Hundreds of thousands of men do not work so they can study supported by welfare. Universal health care. Women are very equal in status.

I grew up heating the Zionist Dream, theory, much like Bernie did, but from conservative Indiana. Seemed very idealist virtue becoming reality in the 50s and 60s. I have often used Israel as the example of a good universal health care system, of education, of welfare. Never heard Bernie say, "I want the US to be like Israel." Why not? Why Sweden?

jonny bakho , March 25, 2017 at 04:54 AM
Frank is wrong. What the GOP establishment dislikes most about Obamacare is the taxes on the wealthy. Medicare for all would have to be paid for by taxes on the wealthy or substantial payroll tax increases on the working class.
This does not meet GOP or Trump objectives for tax cuts on the wealthy.
The TV and radio talk uses Obamacare bashing to sell ads. They can easily change the subject to some other click bait.
Medicare for all? NaGonnaHappN
RC AKA Darryl, Ron -> jonny bakho... , March 25, 2017 at 05:14 AM
Frank was not suggesting that the GOP establishment would support Medicare for all. Frank was suggesting that Trump would essentially change parties to become a Democrat. As dubious as that notion is, more importantly it is premature. If Democrats win back both chambers of Congress, then it would at least be mechanically possible if still extraordinarily dubious. Mostly though Frank was just reaching for something worth saying. Now is a tuff time for commentary on the political economy.
Lee A. Arnold -> jonny bakho... , March 25, 2017 at 06:10 AM
Jonny Bakho: "Medicare for all would have to be paid for by taxes"

Theoretically you don't have to raises taxes if you get private insurers out of the game. They are a big expense, and give no value-added.

Doesn't mean that is politically possible, with Trump and a GOP Congress. But Trump and a Democratic Congress? I couldn't predict. Keep in mind that this man is almost an ideological vacuum, no managerial skills, has no constant concerns for anything except keeping himself in the spotlights, to be loved. And he just learned that the Freedom Caucus is implacably nuts.

RC AKA Darryl, Ron -> Lee A. Arnold ... , March 25, 2017 at 07:30 AM
"They are a big expense, and give no value-added."

[Someone has to do claims processing. The resistance against growing the federal payroll is an unnecessary hurdle for Medicare for all (MFA) to jump. Better administer it more like Medicaid. Let insurance companies handle the operations for a fee. Federal claim payments are handled on a pass thru. Then let the operational administration default to the MFA supplemental plan carrier if the insured has one, else the lowest cost carrier in the insured's state. For MFA clients then there could be a single claims process for providers even for patients with both MFA and MFA supplemental policies. That lowers the hurdle for MFA to leap over the insurance company lobby as well.]

RC AKA Darryl, Ron -> Lee A. Arnold ... , March 25, 2017 at 11:29 AM
Most of health insurance claims processing has been automated for a long time. Still it takes a lot of worker-hours to reconcile the errors.

Imagine how many worker hours it will take to reconcile liabilities for the first multi-car multi-fatality pile up of robot cars on the LA freeway. It will not matter that in total there have been less collisions and less fatalities when the big one hits. Computers are incapable of intuitive judgement which leads to blunders of potentially a colossal scale occurring that could have easily been foreseen by a human. To err is human but it takes a computer to really screw things up beyond all recognition. It is just a matter of time and time is always on Murphy's (that which can go wrong will go wrong) side. I know that myths about computers that never make mistakes and never need to be programmed again abound and I am sure that they will still be with us 20,000 years from now, when we are not even in any memory banks. I spent my entire career about to be replaced by software, but I was finally laid off because of administrative concerns with regards to legacy managed employees in context of the re-compete of the NG/VITA outsourcing contract (which is far less catchy). Computers have the potential to speed transit and reduce fatalities, but that potential will not be permanently realized as long as people are intent upon removing all human control and intervention. Computers can be capable copilots under almost all circumstances, but their owners cannot weather the fallout from their inability to conceive a response on their own when confronted with conditions that they were not programmed for. Such dramatic consequences will eventually raise a great furor, horror, deep sorrow, and extensive liability concerns. Even if you could sue a computer it is unlikely that they could demonstrate the means to pay. Incarceration of a computer for criminal negligence seems a bit ludicrous as well. The owner of the offending property better have their insurance premiums all paid up, but what then? Who will insure the next owner? Advocates of computer driven cars are planning on no fault insurance being mandated in each and every state. Good luck with that.

My wife works for Anthem although not in claims processing. She used to work in membership which is also automated. Software developers for health insurance mostly use Agile methods. One facet of that is that they only expect automation to handle roughly 90% (ideally more) of the workload because they have learned that there will never be a no defects computer system and they are saving expensive labor time in development by allowing lower paid workers to pick up a lot of the more complicated cases manually. That reduces time spent in the iterative process of testing and correcting defects. I am sure that you remember the problems with the ACA's automated insurance membership market. Stuff happens all the time in IT.

It is not that I had to work in IT for 47 years to understand the limitations. Merely my childhood education on the mathematical system of logic that underlies their circuitry and programming would have been sufficient, but a bit of empirical confirmation never hurts. Understanding reality is unfortunately a pre-requisite, but once that is accomplished then there are great opportunities to achieve improved results. Computers are not the problem, but can often be an essential part of the solution rather than a faceless soulless panacea. Does not compute can happen anywhere, but worse though when it happens at 75 MPH.

Lee A. Arnold -> mulp... , March 25, 2017 at 11:27 AM
Every serious study that looks at current costs in the multipayer healthcare insurance concludes that moving to single-payer will save 15-20% of total spending. Here is yet another one:
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4283267/
RC AKA Darryl, Ron -> Lee A. Arnold ... , March 25, 2017 at 11:40 AM
There is nothing about that paper that would not hold true or even truer of a two tiered system of Medicare for all with administrative processing collocated with the supplemental insurer whenever there is one. Just do a work flow model and note how many steps are cut out at each the provider and insurer if primary and secondary coverage administrative processing for membership, claims, and policy holder services are collocated.
RGC -> jonny bakho... , March 25, 2017 at 11:40 AM
Government Funds 60% of U.S. Healthcare Costs - Far Higher than Previously Believed

"We Pay for National Health Insurance but Don't Get It"

"Universal coverage is affordable - without a big tax increase," continued Dr. Himmelstein. "Because taxes already fund 60% of health care costs, a shift about the size of the recent tax cut ($130 billion a year) from private funding to public funding would allow us to cover all the uninsured and improve benefits for everyone else. Insurers/HMOs and drug companies buy-off our politicians with huge campaign contributions and hordes of lobbyists."


http://www.pnhp.org/news/2002/july/government_funds_60.php

RGC -> Chris G ... , March 25, 2017 at 08:04 AM
Beyond the Affordable Care Act: A Physicians' Proposal for Single-Payer Health Care Reform

During a transition period, all public funds currently spent on health care – including Medicare, Medicaid, and state and local health care programs – would be redirected to the unified NHP budget. Such public spending – together with tax subsidies for employer-paid insurance and government expenditures for public workers' health benefits – already accounts for 60% of total U.S. health expenditures.28 Additional funds would be raised through taxes, though importantly these would be fully offset by a decrease in out-of-pocket spending and premiums.

http://www.pnhp.org/nhi

RGC -> RC AKA Darryl, Ron... , March 25, 2017 at 08:04 AM
Is Donald Trump still 'for single-payer' health care?


"Perry said Trump is "for single-payer health care."


Fifteen years ago, Trump was decidedly for a universal healthcare system that resembled Canada's system, in which the government pays for care for all citizens.

Recently, he's said he admires Scotland's single-payer system and disses the Affordable Care Act as incompetently implemented.

However, a Trump spokesman denied that the candidate supported "socialized medicine" and suggested Trump prefers a "free-market" solution. Other than that, though, the Trump campaign has been silent about what his specific health care policies are; perhaps Trump will be pressed on this point during the Aug. 6 debate.

Given the current evidence, Perry's attack is partially accurate, but leaves out details. We rate the statement Half True.

http://www.politifact.com/truth-o-meter/statements/2015/aug/02/rick-perry/donald-trump-still-single-payer-health-care/

[Mar 26, 2017] The good news is they now own health care. They now own Obamacare said Trump

Mar 26, 2017 | economistsview.typepad.com
Fred C. Dobbs , March 25, 2017 at 07:35 AM
In a Call to The Times, Trump Blames Democrats for the
Failure of the Health Bill https://nyti.ms/2nNPHD9
NYT - MAGGIE HABERMAN - MARCH 24, 2017

WASHINGTON - Just moments after the Republican plan to repeal and replace the Affordable Care Act was declared dead, President Trump sought to paint the defeat of his first legislative effort as an early-term blip.

The House speaker, Paul D. Ryan, was preparing to tell the public that the health care bill was being withdrawn - a byproduct, Mr. Trump said, of Democratic partisanship. The president predicted that Democrats would return to him to make a deal in roughly a year.

"Look, we got no Democratic votes. We got none, zero," Mr. Trump said in a telephone interview he initiated with The New York Times.

"The good news is they now own health care. They now own Obamacare."

Mr. Trump insisted that the Affordable Care Act would collapse in the next year, which would then force Democrats to come to the bargaining table for a new bill.

"The best thing that can happen is that we let the Democrats, that we let Obamacare continue, they'll have increases from 50 to 100 percent," he said. "And when it explodes, they'll come to me to make a deal. And I'm open to that."

Although enrollment in the Affordable Care Act declined slightly in the past year, there is no sign that it is collapsing. Its expansion of Medicaid continues to grow.

In a later phone interview with The Times, the Senate minority leader, Chuck Schumer, ridiculed Mr. Trump's remarks about Democrats being at fault.

"Whenever the president gets in trouble, he points fingers of blame," Mr. Schumer said. "It's about time he stopped doing that and started to lead. The Republicans were totally committed to repeal from the get-go, never talked to us once. But now that they realize that repeal can't work, if they back off repeal, of course we'll work with them to make it even better."

Mr. Trump said that "when they come to make a deal," he would be open and receptive. He singled out the Tuesday Group moderates for praise, calling them "terrific," an implicit jab at the House Freedom Caucus, which his aides had expressed frustration with during negotiations. ...

Fred C. Dobbs -> Fred C. Dobbs... , March 25, 2017 at 08:02 AM
On health-care, as on so much else,
President Trump passes the buck, reports
https://www.theatlantic.com/politics/archive/2017/03/the-buck-doesnt-stop-here-anymore/520839/
The Atlantic - David A. Graham - March 24, 2017

Speaking in the Oval Office Friday afternoon, President Trump surveyed the wreckage of the Obamacare repeal effort and issued a crisp, definitive verdict: I didn't do it.

The president said he didn't blame Speaker Paul Ryan, though he had plenty of implied criticism for the speaker. "I like Speaker Ryan. He worked very hard," Trump said, but he added: "I'm not going to speak badly about anybody within the Republican Party. Certainly there's a big history. I really think Paul worked hard." He added ruefully that the GOP could have taken up tax-reform first, instead of Obamacare-the reverse of Ryan's desired sequence. "Now we're going to go for tax reform, which I've always liked," he said.

As for the House Freedom Caucus, the bloc of conservatives from which many of the apparent "no" votes on the Republican plan were to come, Trump said, "I'm not betrayed. They're friends of mine. I'm disappointed because we could've had it. So I'm disappointed. I'm a little surprised, I could tell you."

The greatest blame for the bill's failure fell on Democrats, Trump said.

"This really would've worked out better if we could've had Democrat support. Remember we had no Democrat support," Trump said. Later, he added, "But when you get no votes from the other side, meaning the Democrats, it's really a difficult situation."

He said Democrats should come up with their own bill. "I think the losers are Nancy Pelosi and Chuck Schumer, because they own Obamacare," he said, referring to the House and Senate Democratic leaders. "They 100 percent own it."

Trump was very clear about who was not to blame: himself. "I worked as a team player," the president of the United States said, demoting himself to bit-player status. He wanted to do tax reform first, after all, and it was still early. "I've been in office, what, 64 days? I've never said repeal and replace Obamacare within 64 days. I have a long time. I want to have a great health-care bill and plan and we will."

Strictly speaking, it is true that Trump didn't promise to repeal Obamacare on day 64 of his administration. What he told voters, over and over during the campaign, was that he'd do it immediately. On some occasions he or top allies even promised to do it on day 1. Now he and his allies are planning to drop the bill for the foreseeable future.

It is surely not wrong that there is lots of blame to go around. Congressional Republicans had years to devise a plan, and couldn't come up with one that would win a majority in the House, despite a 44-seat advantage. The House bill was an unpopular one, disliked by conservatives and moderates in that chamber; almost certainly dead on arrival in the Senate; and deeply unpopular with voters. Even before the vote was canceled, unnamed White House officials were telling reporters that the plan was to pin the blame on Ryan. ...

The Republicans fold and
withdraw their health-care bill https://www.theatlantic.com/politics/archive/2017/03/trump-republicans-failure-obamacare/520788/
The Atlantic - Russell Berman - March 24, 2017

... Defeat on the floor dealt Trump a major blow early in his presidency, but its implications were far more serious for the Republican Party as a whole. Handed unified control of the federal government for only the third time since World War II, the modern GOP was unable to overcome its internecine fights to enact a key part of its policy agenda. The president now wants to move on to a comprehensive overhaul of the tax code, but insiders on Capitol Hill have long believed that project will be an even heavier lift than health care.

As the prospect of a loss became more real on Friday, the frustrations of GOP lawmakers loyal to the leadership began to boil over. "I've been in this job eight years, and I'm wracking my brain to think of one thing our party has done that's been something positive, that's been something other than stopping something else from happening," Representative Tom Rooney of Florida said in an interview. "We need to start having victories as a party. And if we can't, then it's hard to justify why we should be back here."

Nothing has exemplified the party's governing challenge quite like health care. For years, Republican leaders resisted pressure from Democrats and rank-and-file lawmakers to coalesce around a detailed legislative alternative to Obamacare. That failure didn't prevent them from attaining power, but it forced them to start nearly from scratch after Trump's surprising victory in November. At Ryan's urging, the party had compiled a plan as part of the speaker's "A Better Way" campaign agenda. Translating that into legislation, however, proved a much stiffer challenge; committee leaders needed to navigate a razor's edge to satisfy conservatives demanding a full repeal of Obamacare and satisfy moderates who preferred to keep in place its more popular consumer protections and Medicaid expansion. They were further limited by the procedural rules of the Senate, which circumscribed how far Republicans could go while still avoiding a Democratic filibuster. ...

[Mar 26, 2017] Our constitutional dollar democracy with its gerrymandering, limitless congressional revolving doors, SCOTUS unanswerable to the electorate, and first past the post voting provides loads of punch lines, not the least of which is the de facto two party system itself. Two competitors is merely duopoly

Mar 26, 2017 | economistsview.typepad.com
RC AKA Darryl, Ron -> ilsm... , March 25, 2017 at 07:09 AM
There is more than one joke. Our constitutional dollar democracy with its gerrymandering, limitless congressional revolving doors, SCOTUS unanswerable to the electorate, and first past the post voting provides loads of punch lines, not the least of which is the de facto two party system itself. Two competitors is merely duopoly. It takes a minimum of three viable choices to have any returns from competition that are significant to the consumers' preferences. Two competitors merely play off each other in predictable and increasingly ossified patterns.
New Deal democrat -> RC AKA Darryl, Ron... , March 25, 2017 at 07:17 AM
One very big quibble: >>SCOTUS unanswerable to the electorate<<

As bad as the SCOTUS can be, it would be unimaginably worse if it were subject to elections.

The big problem is that the Founders did not imagine life expectancies into the 80s. Throughout the 19th Century, the median time on the bench was about 14 years, and about 1/3 of all Justices served less than 10 years -- they got sick or died. Now the median time on the bench is 25 years, which is totally unacceptable.

If SCOTUS terms were set at 18 years, with a new Justice appointed every 2 years, independence would be preserved without the imposition of the "dead hands." Emeritus Justices could continue to serve on the appellate courts, and provisions would have to be made for deaths or retirements during the 18 year terms, but you get the idea.

RC AKA Darryl, Ron -> New Deal democrat... , March 25, 2017 at 07:36 AM
I did not mean elections. One of my favorite planks of the 1912 Bull Moose Party was the right for popular petition and referendum to overturn an unpopular SCOTUS decision. Roe V. Wade could not be overturned by referendum (which some fear but votes are measured by heat count rather than audible volume). Citizen United would be overturned by referendum. I trust democracy more than most, but still I don't get silly about it.

OTOH, SCOTUS term limits are also a good idea.

RC AKA Darryl, Ron -> RC AKA Darryl, Ron... , March 25, 2017 at 07:38 AM
"...heat count..."

[No, HEAD count. If votes were measured by heat count then Bernie Sanders would be POTUS now.]

[Mar 26, 2017] They are an American Taliban: I have never read such a vitriolic comments section. Lots of Americans a seething mad.

Notable quotes:
"... The GOP and this administration are overwhelmingly self-avowed Christians yet they try to deny the poor to benefit the rich. This is not Christian but evil pure and simple. ..."
"... They are an American Taliban, just going about their subversion in a less overtly violent way. ..."
Mar 26, 2017 | economistsview.typepad.com
reason , March 25, 2017 at 03:01 PM
I just read this:

https://www.washingtonpost.com/news/wonk/wp/2017/03/25/why-republicans-were-in-such-a-hurry-on-health-care/?utm_term=.590e103e2761

I have never read such a vitriolic comments section. Lots of Americans a seething mad.

reason -> reason... , March 25, 2017 at 03:03 PM
By mad - I mean angry. And at the Republican party more than Trump.
libezkova -> reason... , March 25, 2017 at 05:10 PM
I like the following comment:

Farang Chiang Mai, 7:39 PM EDT

The GOP and this administration are overwhelmingly self-avowed Christians yet they try to deny the poor to benefit the rich. This is not Christian but evil pure and simple.

I would love to see this lying, cheating, selfish, crazy devil (yeah, I know I sound a bit OTT but the description is fact based) of a president and his enablers challenged on their Christian values.

They are an American Taliban, just going about their subversion in a less overtly violent way.

libezkova -> libezkova... , March 25, 2017 at 05:31 PM
An interesting question arise:

Are the people who consider our current rulers to be "American Taliban" inclined to become "leakers" of government activities against the citizens, because they definitely stop to consider the country as their own and view it as occupied by dangerous and violent religious cult?

Much like Russian people viewed the country under Bolshevism, outside of brief WWII period.

That's probably why we have Anti-Russian witch hunt now. To stem this trend.

But it is the US neoliberal elite, not Russians, who drive the country to this state of affairs.

By spending God knows how many trillions of dollar of wars of neoliberal empire expansion and by drastic redistribution of wealth up.

And now the majority of citizens is facing substandard medical care, sliding standard of living and uncertain job prospects.

[Mar 26, 2017] Democrats are a joke for refusing to sack a sclerotic, corrupt, and inept congressional leadership that had lost three straight elections

Mar 26, 2017 | economistsview.typepad.com
ilsm -> RC AKA Darryl, Ron... , March 25, 2017 at 09:06 AM
cnn resembles deep red tea party fox news..... and the run of the mill dems should fit their tri-corn hats
RC AKA Darryl, Ron -> ilsm... , March 25, 2017 at 09:37 AM
I will take your word for it. We don't watch either CNN nor Fox News at my house. Mostly we watch local (same news and weather crew here appears on each the WWBT/WRLH local NBC/Fox affiliates) news with some sampling of MSNBC and Sunday morning ABC and CBS shows along with the daily half hour of NBC network following the evening local. Cable news is sort of an oxymoron given the prevailing editorial slants. The now retired local TV news anchor Gene Cox laid the groundwork for the best news team in central VA by setting a high bar at his station. Gene laid it all out southern fried with satirical humor and honesty unusual in TV news.
RC AKA Darryl, Ron -> RC AKA Darryl, Ron... , March 25, 2017 at 09:38 AM
Maybe more sarcasm than satire, but the point is the same - wit and honesty.
JohnH -> Chris G ... , March 25, 2017 at 07:52 AM
Apparently we have two jokes alternating to lead America: the Republican jokes vs. the Democratic jokes.

But Democrats are right to expect that, when two jokes vie for power, their turn as joke in power will eventually come.

JohnH -> mulp... , March 25, 2017 at 07:52 AM
Maybe a post mortem would simply reveal that Democrats should have had a coherent economic message and pursued a strategy of standing up for working America for the past 8 years. For example, having Pelosi demand votes on increasing the minimum wage as often as Ryan demanded votes on killing Obamacare...

Any honest post mortem would have revealed that standing with billionaires and the Wall Street banking cartel--and not prosecuting a single Wall Street banker--is not a winning strategy...

Chris G -> JohnH... , March 25, 2017 at 12:33 PM
That Pelosi did not resign immediately following the 2016 election or, not having offered her resignation, that Congressional Democrats did not demand it is an indication that the party still has deep-rooted problems. (Pelosi may not be the cause of those problems but given how badly they've fared since 2010 she's clearly not the solution. She has no business remaining as minority leader.) I'm fine with Perez as DNC chair but Ellison should be minority leader.

[Mar 26, 2017] Staggering cost of Finance Sector under neoliberalism

Notable quotes:
"... Originally published at the Tax Justice Network ..."
"... US finance sector is a net drag on their economy ..."
"... It is a cleverly worked out system for wealth transfer. Complex laws, political backing and protection even if you break the law. At least in the old days when you got robbed you had the signal of having a pistol pointed at you. The modern version, with all the insider media psyops, leaves those who are preyed upon feeling that they are the ones to blame. ..."
"... The business model is straight out of the Cosa Nostra playbook – except there is media, political and legal backing. ..."
"... As an Italian friend of mine (who rarely goes north of 14th Street) once remarked, "The difference between the Mafia and bankers is that the Mafia always leaves a few crumbs on the table." ..."
"... Did I hear that right – the private finance sector will have cost us (in the US) 23Tr$ by 2020. And from 1990 to 2005 big finance cost us (already) 14Tr in fees, pay, fraud, misallocation and lost productivity. Yet we continue to deregulate even though all governments know how destructive deregulated finance is. ..."
"... yes, the EU does seem to be hungry to grab up all that finance for itself I keep thinking about Schaeuble coming to NYC c2012 and holding an impromptu news conference wherein he said it was fine with him if some banks went down because "we are overbanked." But we do have to admit that "overbanked" is an understatement since there are no productive investments and it's just self-defeating. I mean, how long can this go on? ..."
"... I don't know, how much money do you have left? ..."
"... It pays to remember that prior to 2008, hot (sovereign state backed) money flowed unimpeded like water across all EU borders, regardless of regulation, in search of quick handsome and easy returns, and much of it from subsequently bailed out by the ECB backdoor major lenders in France and Germany lending recklessly to poorer EZ members. ..."
"... The lasting results of this and its hasty, damaging retreat and the inequitable socialisation of the debt across the EZ are, of course, still being felt today. ..."
"... One of the major causes of the financial crisis was lax global regulation period. So let's not kid ourselves that by removing the UK from the European Union equation it is suddenly going to render it a bastion of sound prudential banking practice, particularly given various members recent comments that they intend to do anything in their power to tempt a post Brexit UK's financial services at the earliest opportunity. ..."
"... I do subscribe to the belief that the UK financial services sector has been and still is toxic to its economy and long-term future, and without a doubt this informed the Brexit vote, albeit in some cases on a subconscious level. ..."
Mar 26, 2017 | www.nakedcapitalism.com
Posted on March 25, 2017 by Yves Smith Originally published at the Tax Justice Network

In our March 2017 Taxcast: the high price we're paying for our finance sectors – we look at staggering statistics showing how the US finance sector is a net drag on their economy .

Also, as the British government initiates Brexit divorce negotiations to leave the EU, we discuss something they ought to know, but obviously don't – they're actually in a very weak position. Could it mean the beginning of the end of the finance curse gripping the UK economy?

Featuring: John Christensen and Alex Cobham of the Tax Justice Network, and Professor of Economics Gerald Epstein of the University of Masachusetts Amhurst , author of Overcharged: The High Cost of High Finance . Produced and presented by Naomi Fowler for the Tax Justice Network.

Professor Gerald Epstein:

If you look at particular finance centres, say London and New York, the problem is that the net cost of this system is quite significant, it imposes a cost not only on people who use finance but for the whole economy. So, what we need to think about is what are the more productive activities that ought to be substituted for these excessive aspects of finance?

John Christensen, Tax Justice Network on Britain's weak position in Brexit negotiations:

We might be seeing the start of the end of Britain's grip by the Finance Curse

https://www.youtube.com/embed/E7oOiJl1n1I

Download the mp3 to listen offline anytime on your computer, mobile/cell phone or handheld device by right clicking here and selecting 'save link as'.

Want more Taxcasts? The full playlist is here .

Want to subscribe? Subscribe via email by contacting the Taxcast producer on naomi [at] taxjustice.net OR subscribe to the Taxcast RSS feed here OR subscribe to our youtube channel, Tax Justice TV OR find us on iTunes

skippy , March 25, 2017 at 3:01 am

Drag = Rentier = bottle neck economics which in the end becomes a death spiral due to lack of demand and jobs quality .

Si , March 25, 2017 at 3:45 am

It is a cleverly worked out system for wealth transfer. Complex laws, political backing and protection even if you break the law. At least in the old days when you got robbed you had the signal of having a pistol pointed at you. The modern version, with all the insider media psyops, leaves those who are preyed upon feeling that they are the ones to blame.

The business model is straight out of the Cosa Nostra playbook – except there is media, political and legal backing.

Genius.

Hayek's Heelbiter , March 25, 2017 at 6:14 am

As an Italian friend of mine (who rarely goes north of 14th Street) once remarked, "The difference between the Mafia and bankers is that the Mafia always leaves a few crumbs on the table."

Watt4Bob , March 25, 2017 at 11:00 am

"Wouldn't you rather give me my money, that you have in your pocket, rather than force me to take the pistol out of my pocket, and point it at you, and rob you, and become a criminal?"

As you can clearly see, the logic is flawless, we are all much better off acquiescing to the reasonable demands of the FIRE sector, the only alternative being an admission that we're in the clutches of a deeply organized criminal element.

susan the other , March 25, 2017 at 11:44 am

thanks for this Taxcast, very to the point.

Did I hear that right – the private finance sector will have cost us (in the US) 23Tr$ by 2020. And from 1990 to 2005 big finance cost us (already) 14Tr in fees, pay, fraud, misallocation and lost productivity. Yet we continue to deregulate even though all governments know how destructive deregulated finance is.

And we know that the US is the biggest and most secret tax haven of them all

The first part of Taxcast speculated that Brexit will actually free the UK from the stranglehold of big finance and the country will be able to move on to more productive economic activity. So let us hope the US comes to its senses – just as the EU has finally isolated the rot of UK finance, maybe the rest of the world will isolate us.

Regulation seems to be hand-in-glove with national sovereignty. Whereas globalized finance might have escaped national regulation bec. there was always a safe haven for banksters, now with a backlash of indignant people all over the world there will be re-regulation at national levels. Since there is no global authority that can do that yet. Anyway, now that economies are trashed, there is way too much hot money to find good investments. It has already become absurd.

Colonel Smithers , March 25, 2017 at 11:51 am

Thank you, Susan.

I would not be so hasty thinking that the EU(27) has finally isolated the rot of UK finance. Much of that finance was not UK, but using the UK. The EU(27) is no less corrupt than the UK and as susceptible to big finance's charms.

I worked as a lobbyist in Brussels (and Basel and DC) for years.

susan the other , March 25, 2017 at 12:31 pm

yes, the EU does seem to be hungry to grab up all that finance for itself I keep thinking about Schaeuble coming to NYC c2012 and holding an impromptu news conference wherein he said it was fine with him if some banks went down because "we are overbanked." But we do have to admit that "overbanked" is an understatement since there are no productive investments and it's just self-defeating. I mean, how long can this go on?

Watt4Bob , March 25, 2017 at 3:21 pm

I mean, how long can this go on?

I don't know, how much money do you have left?

Gman , March 25, 2017 at 6:25 pm

Great piece. Thank you.

I'm not sure I get the 'rules on financial services are different than other goods and services' line being peddled here though. Maybe in theory, but it's pretty much a moot point.

It pays to remember that prior to 2008, hot (sovereign state backed) money flowed unimpeded like water across all EU borders, regardless of regulation, in search of quick handsome and easy returns, and much of it from subsequently bailed out by the ECB backdoor major lenders in France and Germany lending recklessly to poorer EZ members.

The lasting results of this and its hasty, damaging retreat and the inequitable socialisation of the debt across the EZ are, of course, still being felt today.

One of the major causes of the financial crisis was lax global regulation period. So let's not kid ourselves that by removing the UK from the European Union equation it is suddenly going to render it a bastion of sound prudential banking practice, particularly given various members recent comments that they intend to do anything in their power to tempt a post Brexit UK's financial services at the earliest opportunity.

I do subscribe to the belief that the UK financial services sector has been and still is toxic to its economy and long-term future, and without a doubt this informed the Brexit vote, albeit in some cases on a subconscious level.

[Mar 25, 2017] stock, bond and commodities historical returns

Mar 25, 2017 | economistsview.typepad.com
im1dc :, March 25, 2017 at 10:40 AM
FYI

For those who may be interested in quality data at your fingertips for free

Some you know, some you may not

http://www.marketwatch.com/story/ben-carlson-my-12-favorite-and-free-websites-for-investing-information-and-tools-2017-03-24

"Ben Carlson: My 12 favorite (and free) websites for investing information and tools"

By Ben Carlson...Mar 25, 2017...9:39 a.m. ET

..."I get a lot of questions from readers asking what data sources or models I use. I've been building my own Excel models and formulas for a while and have access to a handful of professional subscription-based offerings. But you don't have to spend tens of thousands of dollars on historical data providers to access useful financial data in the internet age. There are plenty of useful free websites that have historical market data, back-testing tools, risk statistics and scenario analysis capabilities.

Here are some that I have found helpful over the years:

NYU's stock, bond and cash historical returns

NYU professor Aswath Damodaran uses this site to update the performance numbers for stocks (S&P 500 SPX, -0.08% ), bonds (10-year Treasuries) and cash (three-month T-bills) once a year. It shows the annual returns for these three asset classes going back to 1928. You can download an Excel file that contains historical interest rates, bond yields and dividend yields. I use these numbers frequently.

Portfolio Visualizer

This site has one of the best free asset allocation back-testing programs I've come across. There are probably 20-30 different asset classes and sub-asset classes you can back-test to the 1970s with historical returns, drawdowns, real (after-inflation) returns, and growth of your initial investment. This site enables you to perform Monte Carlo simulations on withdrawal strategies, correlation matrixes between different assets, risk factor analysis and back-test real world portfolios using actual mutual funds and ETFs. That this website is free is pretty remarkable.

Robert Shiller's online data

Shiller has one of the longest-running data sets I've seen. His famous CAPE spreadsheet has the monthly stock price, interest rate, earnings and dividend data from 1871. This site has his comprehensive real estate data on home prices from 100 years ago.

Twitter

People on social media love to complain about social media, but I find a ton of value in the information I receive from Twitter TWTR, +1.41% I'm constantly finding helpful research, graphs, data and analysis that I wouldn't be exposed to otherwise. Twitter is my go-to source for what's going on in the world of finance and the markets, along with under-the-radar research.

Fama-French

Ken French updates this site using much of the research he's done over the years with Eugene Fama. This one is a factor investing nerd's dream, although the site does take some time to figure out how to use efficiently (at least in my experience). French updates his data regularly with historical returns on factors such as small-cap stocks, value stocks, quality stocks and momentum stocks dating to the 1920s. This site has great data on sector and industry historical returns. All of the data are easily exportable to Excel.

Credit Suisse Global Investment Returns Yearbook

Researchers Elroy Dimson, Paul March and Mike Staunton update this report once a year with numbers on stocks, bonds and inflation going back to 1900 for a number of countries. It's worth going through the entire report at least once.

MSCI

MSCI provides the most comprehensive free source of historical market data on foreign stock markets. It has performance numbers dating to 1970 for different countries, regions and markets, both developed and emerging.

Abnormal Returns

The best curated content each and every day on investing, personal finance, research and anything else in the world of finance. If you miss anything worth reading, you can be sure it will be here.

Federal Reserve Economic Data (FRED)

Econ geeks love this site because the Federal Reserve has data on almost anything related to economics you can think of. There's also plenty of good market data on stocks, bonds and interest rates as well. And the site enables you to personalize the graphs and data sets.

Morningstar

I find that Morningstar MORN, -0.36% has the best data on mutual funds and ETFs for performance purposes. You can see annual returns going back 10 years, and monthly and quarterly returns going back five years. The company provides after-tax returns and fund behavior gaps, which I find really useful for seeing what investors are actually earning in these funds. You can find breakdowns of fund holdings, investment styles, geographic allocations and more.

Yahoo Finance

I like Yahoo YHOO, -0.43% Finance for daily historical data on stocks, interest rates and indexes. It has annual and quarterly performance numbers for mutual funds from inception, many of which give you decades of returns.

Portfolio Charts

This is another great asset allocation back-testing tool that enables you to see how a number of well-known portfolios have performed over the years. This site has the best visuals of any I've played around with. You can also stress-test a large number of asset classes and strategies.

And here are a few more I've used over the years:

[Mar 25, 2017] Is productivity metric as problematic as GDP?

Mar 24, 2017 | cepr.net

anne: March 24, 2017 at 05:21 AM

Marketplace Radio Has Not Heard About the Productivity Slowdown

Marketplace radio had a peculiar piece * asking what the world would have looked like if the North American Free Trade Agreement never had been signed. The piece is odd because it dismisses job concerns associated with NAFTA by telling readers that automation (i.e. productivity growth) has been far more important in costing jobs.

"As in, ATMs replacing bankers, robots displacing welders. Automation is a very old story that goes back 250 years, but it has really picked up in the last couple decades.

"'We economic developers have an old joke,' said Charles Hayes of the Research Triangle Regional Partnership in an interview with Marketplace in 2010. 'The manufacturing facility of the future will employ two people: one will be a man, and one will be a dog. And the man will be there to feed the dog. And the dog will be there to make sure the man doesn't touch the equipment.'

"Ouch. But it turns out technology replaced workers in the course of reporting this very story."

Actually, the Bureau of Labor Statistics tells us the opposite. Productivity growth did pick up from 1995 to 2005, rising back to its 1947 to 1973 Golden Age pace (a period of low unemployment and rapidly rising wages), but has slowed sharply in the last dozen years.

[Graph]

While more rapid productivity growth would allow for faster wage and overall economic growth, no one has a very clear path for raising the rate of productivity growth. It is strange that Marketplace thinks our problem is a too rapid pace of productivity growth.

The piece is right in saying that the jobs impact of NAFTA was relatively limited. Certainly trade with China displaced many more workers. NAFTA may nonetheless have had a negative impact on the wages of many manufacturing workers. It made the threat to move operations to Mexico far more credible and many employers took advantage of this opportunity ** to discourage workers from joining unions and to make wage concessions. It's surprising that the piece did not discuss this effect of NAFTA.

* https://www.marketplace.org/2017/03/23/economy/what-if-nafta-were-never-born

** http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1018&context=cbpubs

-- Dean Baker

anne said in reply to anne...

https://fred.stlouisfed.org/graph/?g=d6jh

November 1, 2014

Total Factor Productivity for United States, 1952-2014

(Percent Change)


https://fred.stlouisfed.org/graph/?g=d7LU

November 1, 2014

Total Factor Productivity for United States, 1952-2014

(Indexed to 1952)

pgl said in reply to anne... March 24, 2017 at 06:01 AM

Thanks for the data. It confirms what Dean wrote here:

"the Bureau of Labor Statistics tells us the opposite. Productivity growth did pick up from 1995 to 2005, rising back to its 1947 to 1973 Golden Age pace (a period of low unemployment and rapidly rising wages), but has slowed sharply in the last dozen years.

anne said in reply to pgl... March 24, 2017 at 06:10 AM

Looking internationally, I consider the evidence conclusive that productivity growth has slowed significantly since 2005 in countries that have had limited infrastructure development, regardless of the emphasis in those countries on information technology advance and application.

libezkova -> anne... March 25, 2017 at 09:33 AM

And what is productivity ?

== quote ==

The OECD defines it as "the ratio of a volume measure of output to a volume measure of input".] Volume measures of output are normally gross domestic product (GDP) or gross value added (GVA), expressed at constant prices i.e. adjusted for inflation.

== end of quote ==

If you use GDP the result is suspect for the reasons GDP is suspect. If not, then it is sector/industry based metric.

In this sense growth of GDP in 1990th is not only the result of technological changes (Internet, PCs, cell phones) but also looting of the xUSSR economies

And as looting slowed down after 2000 growth of productivity also allowed down.

libezkova -> libezkova... March 25, 2017 at 10:32 AM

Steve Keen pointed out that all production is driven by energy (mostly oil and electricity). And the energy comes ultimately from the sun.

Either it is turned into production via feeding workers, or by fueling machinery (by burning hydrocarbons or indirectly via electricity supply).

That means that growth of productivity is inversely correlated with the price of oil. As the period of cheap hydrocarbons ended (remember $.99 per gallon of gas in 90th) the period of rapid productivity growth ended as well.

One of the aspects od the idea of "secular stagnation" is that high oil prices hit neoliberal economies like a hammer and the period of high oil prices started to undermine neoliberal globalization by making shipping more expensive.

That also means that without continuation of low oil prices the next debt crisis (aka Minsky moment) is eminent for the USA economy.

BTW none of US shale companies is profitable. They are all up to the neck in debt, and their method of extracting oil includes generating a flow of junk bonds. If financing stops most of them will be bankrupt in one year period.

Obama clever game with Iran helped to produce "Obama recovery" due to the period of "normal" oil prices which started in mid 2015.

It probably can be extended for another year or two. What happens next is completely unknown territory. It is clear that the US shale is a card that was already played. It can't be played again as output probably can be substantially raised (say 2 Mbd/day) only with high or very high oil prices (as in above $70 or higher).

After "Obama recovery" (which depends on continuing low oil prices created by clever political maneuvering in Arab world -- Hail Mary pass that worked) we might well face the period of "elevated oil prices" and increased stagnation of the US economy with noticeably higher level of unemployment.

Much depends on Trump playing his trump card of "détente" with Russia which theoretically could extend this period (Russia has the same level of oil production as Saudis and more reserves), but there were to much sand thrown by neocons and DemoRats for this scenario to work. I thing Russia now is no longer interested in partnership with the USA on the basis of maintaining low oil prices -- like KSA today, and might cut output further to get higher oil prices which are vital for their economy. Of course Russia has strong neoliberal fifth column (including pro-western directors of oil companies and oligarchs who have their wealth transferred to Western banks) but even they are pissed off by the USA now.

DemoRats wiped up Anti-Russian hysteria to the level when even contact with Russian official can be a "career limiting move" in the USA.

This hysteria now has its own self-propagating dynamics and is difficult to stop. It might last for the same period of time as McCarthyism hysteria (roughly from 1947 to 1956).

"... "The principal problem for Democrats is that so many media figures and online charlatans are personally benefiting from feeding the base increasingly unhinged, fact-free conspiracies - just as right-wing media polemicists did after both Bill Clinton and Obama were elected - that there are now millions of partisan soldiers absolutely convinced of a Trump/Russia conspiracy for which, at least as of now, there is no evidence. ..."

It put the Democrats and Republicans in sync as two equally warmongering parties, but what good that would bring for the American people and the world is hard to fathom.

The USA lost the possibility of switching personal car fleet to more economical hybrid models by adopting some drastic measures and now is less prepared for a new period of high oil prices. People are still buying SUV which became the most popular type of personal transportation in the USA, and small tracks.

On the electricity front there are some problems too. The looting of Russia and the flow of cheap uranium stopped. Building of high voltage East -West line necessary for substantial wind and solar production is still on the drawing board.

[Mar 25, 2017] Like most integral metrics (and, especially, like GDP) productivity growth is very suspect. Its importance was artificially amplified under neoliberalism to the sacred cow status

Notable quotes:
"... The long term absence of convergence in productivity growth between developed and developing countries should be of considerable concern, but seems overlooked even in settings such as trade negotiations in which such concerns especially need to be addressed. ..."
"... You need to understand that like most "integral" metrics (and, especially, like GDP) productivity growth is very suspect. Its importance was artificially amplified under neoliberalism to the "sacred cow" status. ..."
"... While the strong earnings growth of US-based corporations might, at least partially, be real and not all accounting tricks, the question arise what part of those gains are coming from improvements in domestic productivity and what part from offshoring. ..."
"... Productivity growth is an important part of the system of neoliberal myths (along with "cult of GDP" ) and this mythology is directed at deceiving the public that it is indirectly benefitting from the neoliberal transformation of the society, while in reality we observe impoverishment of the majority of population. As in " The USA is the country with fastest productivity grown." Rejoice. ..."
Mar 25, 2017 | economistsview.typepad.com

anne -> anne... March 25, 2017 at 10:31 AM

The long term absence of convergence in productivity growth between developed and developing countries should be of considerable concern, but seems overlooked even in settings such as trade negotiations in which such concerns especially need to be addressed.

libezkova -> anne..., March 25, 2017 at 04:42 PM

Anne,

You need to understand that like most "integral" metrics (and, especially, like GDP) productivity growth is very suspect. Its importance was artificially amplified under neoliberalism to the "sacred cow" status.

Government bureaucrats also are afraid to tell the truth. Richard Benson , a well-known critic of government labor statistics, who wrote several insightful papers on the subject, noted "The BLS is mindful of how politically sensitive any reported job data is to the White House, so there is a strong bias for the government bureaucrats to publish a favorable jobs report."

One hidden fact is that it is offshoring that is the driver of corporate profits and it distorts "productivity" statistics.

While the strong earnings growth of US-based corporations might, at least partially, be real and not all accounting tricks, the question arise what part of those gains are coming from improvements in domestic productivity and what part from offshoring.

Rising stratification of the society also affects this metric (via the ratio of "have more" vs "have not")

Productivity growth is an important part of the system of neoliberal myths (along with "cult of GDP" ) and this mythology is directed at deceiving the public that it is indirectly benefitting from the neoliberal transformation of the society, while in reality we observe impoverishment of the majority of population. As in " The USA is the country with fastest productivity grown." Rejoice.

It is also simplifies the adoption of pro financial oligarchy policies masked with technocratic jargon -- policies that destroyed New Deal and hurt the majority of the population ("rising labor costs" is one such usage).

Adopting technocratic posture (economics like Boeing there by using certain controls you can change flight course) serves like anesthetic. Rephrasing Marx we can say "neoliberal economics is the opium for the people". And it is by design. which confirms the iron law of oligarchy in a very interesting, unexpected way.

That's why jargon use by priests of neo-classical economics is almost in-penetrable for an ordinary person. The well known neoliberal stooge Greenspan was a real master of it.

So the importance assigned to such measures as GDP and productivity is, to a certain extent, politically motivated.

For example, in the denominator we have all those hedge funds managers and other members of financial oligarchy bonuses, and top managers exorbitant remuneration within all kinds of firms (which definitely drives productivity growth down ;-)

In the numerator are military expenses and income of financial sector (and now another somewhat parasitic sector close to banking -- medical insurance industry).

Both are essentially money stolen from people and, to a certain extent, from "real" economy.

Of cause, not all money are wasted as military spending in addition to war for neoliberal empire expansion (and related loot) also employs a lot of people and fund fundamental research; the myth about innovation of Silicon Valley is partially a myth; in reality in many cases this is a direct transfer of technology from the military sector.

Among the examples are integrated circuits, laser, wireless, Internet, multiprocessing, etc; even some algorithmic languages :-).

So when you have such fuzzy numerator and denominator, the result is also fuzzy and all conclusions based on them might be not worth electrons with which they are depicted on our screens.

As I mentioned before, productivity should be somewhat inversely correlated with the oil price, as "amount of energy per worker" is what defines at the end worker's productivity (via the level of automation, mechanization of his work). That's were the USA strong (or week, if you wish) point is -- it has the largest consumption of energy per capita in the world. If we normalize productivity via per capita energy consumption we will get a more interesting picture.

[Mar 25, 2017] Is productivity metric as problemtic as GDP?

Notable quotes:
"... The OECD defines it as "the ratio of a volume measure of output to a volume measure of input".] Volume measures of output are normally gross domestic product (GDP) or gross value added (GVA), expressed at constant prices i.e. adjusted for inflation. ..."
"... If you use GDP the result is suspect for the reasons GDP is suspect. If not, then it is sector/industry based metric. ..."
"... In this sense growth of GDP in 1990th is not only the result of technological changes (Internet, PCs, cell phones) but also looting of the xUSSR economies ..."
"... And as looting slowed down after 2000 growth of productivity also allowed down. ..."
"... One of the aspects of the idea of "secular stagnation" is that high oil prices hit neoliberal economies like a hammer and the period of high oil prices started to undermine neoliberal globalization by making shipping more expensive. ..."
"... BTW none of US shale companies is profitable. They are all up to the neck in debt, and their method of extracting oil includes generating a flow of junk bonds. If financing stops most of them will be bankrupt in one year period. ..."
Mar 24, 2017 | cepr.net

anne: March 24, 2017 at 05:21 AM

Marketplace Radio Has Not Heard About the Productivity Slowdown

Marketplace radio had a peculiar piece * asking what the world would have looked like if the North American Free Trade Agreement never had been signed. The piece is odd because it dismisses job concerns associated with NAFTA by telling readers that automation (i.e. productivity growth) has been far more important in costing jobs.

"As in, ATMs replacing bankers, robots displacing welders. Automation is a very old story that goes back 250 years, but it has really picked up in the last couple decades.

"'We economic developers have an old joke,' said Charles Hayes of the Research Triangle Regional Partnership in an interview with Marketplace in 2010. 'The manufacturing facility of the future will employ two people: one will be a man, and one will be a dog. And the man will be there to feed the dog. And the dog will be there to make sure the man doesn't touch the equipment.'

"Ouch. But it turns out technology replaced workers in the course of reporting this very story."

Actually, the Bureau of Labor Statistics tells us the opposite. Productivity growth did pick up from 1995 to 2005, rising back to its 1947 to 1973 Golden Age pace (a period of low unemployment and rapidly rising wages), but has slowed sharply in the last dozen years.

[Graph]

While more rapid productivity growth would allow for faster wage and overall economic growth, no one has a very clear path for raising the rate of productivity growth. It is strange that Marketplace thinks our problem is a too rapid pace of productivity growth.

The piece is right in saying that the jobs impact of NAFTA was relatively limited. Certainly trade with China displaced many more workers. NAFTA may nonetheless have had a negative impact on the wages of many manufacturing workers. It made the threat to move operations to Mexico far more credible and many employers took advantage of this opportunity ** to discourage workers from joining unions and to make wage concessions. It's surprising that the piece did not discuss this effect of NAFTA.

* https://www.marketplace.org/2017/03/23/economy/what-if-nafta-were-never-born

** http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1018&context=cbpubs

-- Dean Baker

anne said in reply to anne...

https://fred.stlouisfed.org/graph/?g=d6jh

November 1, 2014

Total Factor Productivity for United States, 1952-2014

(Percent Change)


https://fred.stlouisfed.org/graph/?g=d7LU

November 1, 2014

Total Factor Productivity for United States, 1952-2014

(Indexed to 1952)

pgl said in reply to anne... March 24, 2017 at 06:01 AM

Thanks for the data. It confirms what Dean wrote here:

"the Bureau of Labor Statistics tells us the opposite. Productivity growth did pick up from 1995 to 2005, rising back to its 1947 to 1973 Golden Age pace (a period of low unemployment and rapidly rising wages), but has slowed sharply in the last dozen years.

anne said in reply to pgl... March 24, 2017 at 06:10 AM

Looking internationally, I consider the evidence conclusive that productivity growth has slowed significantly since 2005 in countries that have had limited infrastructure development, regardless of the emphasis in those countries on information technology advance and application.

libezkova -> anne... March 25, 2017 at 09:33 AM

And what is productivity ?

== quote ==

The OECD defines it as "the ratio of a volume measure of output to a volume measure of input".] Volume measures of output are normally gross domestic product (GDP) or gross value added (GVA), expressed at constant prices i.e. adjusted for inflation.

== end of quote ==

If you use GDP the result is suspect for the reasons GDP is suspect. If not, then it is sector/industry based metric.

In this sense growth of GDP in 1990th is not only the result of technological changes (Internet, PCs, cell phones) but also looting of the xUSSR economies

And as looting slowed down after 2000 growth of productivity also allowed down.

libezkova -> libezkova... March 25, 2017 at 10:32 AM

Steve Keen pointed out that all production is driven by energy (mostly oil and electricity). And the energy comes ultimately from the sun.

Either it is turned into production via feeding workers, or by fueling machinery (by burning hydrocarbons or indirectly via electricity supply).

That means that growth of productivity is inversely correlated with the price of oil. As the period of cheap hydrocarbons ended (remember $.99 per gallon of gas in 90th) the period of rapid productivity growth ended as well.

One of the aspects of the idea of "secular stagnation" is that high oil prices hit neoliberal economies like a hammer and the period of high oil prices started to undermine neoliberal globalization by making shipping more expensive.

That also means that without continuation of low oil prices the next debt crisis (aka Minsky moment) is eminent for the USA economy.

BTW none of US shale companies is profitable. They are all up to the neck in debt, and their method of extracting oil includes generating a flow of junk bonds. If financing stops most of them will be bankrupt in one year period.

Obama clever game with Iran helped to produce "Obama recovery" due to the period of "normal" oil prices which started in mid 2015.

It probably can be extended for another year or two. What happens next is completely unknown territory. It is clear that the US shale is a card that was already played. It can't be played again as output probably can be substantially raised (say 2 Mbd/day) only with high or very high oil prices (as in above $70 or higher).

After "Obama recovery" (which depends on continuing low oil prices created by clever political maneuvering in Arab world -- Hail Mary pass that worked) we might well face the period of "elevated oil prices" and increased stagnation of the US economy with noticeably higher level of unemployment.

Much depends on Trump playing his trump card of "détente" with Russia which theoretically could extend this period (Russia has the same level of oil production as Saudis and more reserves), but there were to much sand thrown by neocons and DemoRats for this scenario to work. I thing Russia now is no longer interested in partnership with the USA on the basis of maintaining low oil prices -- like KSA today, and might cut output further to get higher oil prices which are vital for their economy. Of course Russia has strong neoliberal fifth column (including pro-western directors of oil companies and oligarchs who have their wealth transferred to Western banks) but even they are pissed off by the USA now.

DemoRats wiped up Anti-Russian hysteria to the level when even contact with Russian official can be a "career limiting move" in the USA.

This hysteria now has its own self-propagating dynamics and is difficult to stop. It might last for the same period of time as McCarthyism hysteria (roughly from 1947 to 1956).

"... "The principal problem for Democrats is that so many media figures and online charlatans are personally benefiting from feeding the base increasingly unhinged, fact-free conspiracies - just as right-wing media polemicists did after both Bill Clinton and Obama were elected - that there are now millions of partisan soldiers absolutely convinced of a Trump/Russia conspiracy for which, at least as of now, there is no evidence. ..."

It put the Democrats and Republicans in sync as two equally warmongering parties, but what good that would bring for the American people and the world is hard to fathom.

The USA lost the possibility of switching personal car fleet to more economical hybrid models by adopting some drastic measures and now is less prepared for a new period of high oil prices. People are still buying SUV which became the most popular type of personal transportation in the USA, and small tracks.

On the electricity front there are some problems too. The looting of Russia and the flow of cheap uranium stopped. Building of high voltage East -West line necessary for substantial wind and solar production is still on the drawing board.

[Mar 25, 2017] Its Not Just Unfair: Inequality Is a Threat to Our Governance

Notable quotes:
"... As recognized since ancient times, the coexistence of very rich and very poor leads to two possibilities, neither a happy one. The rich can rule alone, disenfranchising or even enslaving the poor, or the poor can rise up and confiscate the wealth of the rich. The rich tend to see themselves as better than the poor, a proclivity that is enhanced and even socially sanctioned in modern meritocracies. The poor, with little prospect of economic improvement and no access to political power, "might turn to a demagogue who would overthrow the government - only to become a tyrant. Oligarchy or tyranny, economic inequality meant the end of the republic." ..."
"... Some constitutions were written to contain inequalities. In Rome, the patricians ruled, but could be overruled by plebeian tribunes whose role was to protect the poor. There are constitutions with lords and commoners in separate chambers, each with well-defined powers. Sitaraman calls these "class warfare constitutions," and argues that the founding fathers of the United States found another way, a republic of equals. The middle classes, who according to David Hume were obsessed neither with pleasure-seeking, as were the rich, nor with meeting basic necessities, as were the poor, and were thus amenable to reason, could be a firm basis for a republic run in the public interest. There is some sketchy evidence that income and wealth inequality was indeed low in the 18th century, but the crucial point is that early America was an agrarian society of cultivators with an open frontier. No one needed to be poor when land was available in the West. ..."
"... Jefferson was proud of his achievement in abolishing the entail and primogeniture in Virginia, writing the laws that "laid the ax to the root of Pseudoaristocracy." He called for progressive taxation and, like the other founders, feared that the inheritance of wealth would lead to the establishment of an aristocracy. ..."
"... Madison tried to calculate how long the frontier would last, and understood the threat to the Constitution that industrialization would bring; many of the founders thought of wage labor as little better than slavery and hoped that America could remain an agrarian society. ..."
"... In perhaps the most original part of his book, Sitaraman, an associate professor of law at Vanderbilt Law School, highlights the achievements of the Progressive movement, one of whose aims was taming inequality, and which successfully modified the Constitution. There were four constitutional amendments in seven years - the direct election of senators, the franchise for women, the prohibition of alcohol and the income tax. To which I would add another reform, the establishment of the Federal Reserve, which provided a mechanism for handling financial crises without the need for the government to be bailed out by rich bankers, as well as the reduction in the tariff, which favored ordinary people by bringing down the cost of manufactures. Politics can respond to inequality, and the Constitution is not set in stone. ..."
"... It's interesting that the language of inequality is the language of technocrats, however worthy. It's a way to talk about the politics without referring to Marxist or populist/labor traditions which often involve social movements. ..."
Mar 25, 2017 | economistsview.typepad.com
anne : March 25, 2017 at 11:26 AM
https://www.nytimes.com/2017/03/20/books/review/crisis-of-the-middle-class-constitution-ganesh-sitaraman-.html

March 20, 2017

It's Not Just Unfair: Inequality Is a Threat to Our Governance
By ANGUS DEATON

THE CRISIS OF THE MIDDLE-CLASS CONSTITUTION
Why Economic Inequality Threatens Our Republic
By Ganesh Sitaraman

President Obama labeled income inequality "the defining challenge of our time." But why exactly? And why "our time" especially? In part because we now know just how much goes to the very top of the income distribution, and beyond that, we know that recent economic growth, which has been anemic in any case, has accrued mostly to those who were already well-heeled, leaving stagnation or worse for many Americans. But why is this a problem?

Why am I hurt if Mark Zuckerberg develops Facebook, and gets rich on the proceeds? Some care about the unfairness of income inequality itself, some care about the loss of upward mobility and declining opportunities for our kids and some care about how people get rich - hard work and innovation are O.K., but theft, legal or otherwise, is not. Yet there is one threat of inequality that is widely feared, and that has been debated for thousands of years, which is that inequality can undermine governance. In his fine book, both history and call to arms, Ganesh Sitaraman argues that the contemporary explosion of inequality will destroy the American Constitution, which is and was premised on the existence of a large and thriving middle class. He has done us all a great service, taking an issue of overwhelming public importance, delving into its history, helping understand how our forebears handled it and building a platform to think about it today.

As recognized since ancient times, the coexistence of very rich and very poor leads to two possibilities, neither a happy one. The rich can rule alone, disenfranchising or even enslaving the poor, or the poor can rise up and confiscate the wealth of the rich. The rich tend to see themselves as better than the poor, a proclivity that is enhanced and even socially sanctioned in modern meritocracies. The poor, with little prospect of economic improvement and no access to political power, "might turn to a demagogue who would overthrow the government - only to become a tyrant. Oligarchy or tyranny, economic inequality meant the end of the republic."

Some constitutions were written to contain inequalities. In Rome, the patricians ruled, but could be overruled by plebeian tribunes whose role was to protect the poor. There are constitutions with lords and commoners in separate chambers, each with well-defined powers. Sitaraman calls these "class warfare constitutions," and argues that the founding fathers of the United States found another way, a republic of equals. The middle classes, who according to David Hume were obsessed neither with pleasure-seeking, as were the rich, nor with meeting basic necessities, as were the poor, and were thus amenable to reason, could be a firm basis for a republic run in the public interest. There is some sketchy evidence that income and wealth inequality was indeed low in the 18th century, but the crucial point is that early America was an agrarian society of cultivators with an open frontier. No one needed to be poor when land was available in the West.

The founders worried a good deal about people getting too rich. Jefferson was proud of his achievement in abolishing the entail and primogeniture in Virginia, writing the laws that "laid the ax to the root of Pseudoaristocracy." He called for progressive taxation and, like the other founders, feared that the inheritance of wealth would lead to the establishment of an aristocracy. (Contrast this with those today who simultaneously advocate both equality of opportunity and the abolition of estate taxes.) Madison tried to calculate how long the frontier would last, and understood the threat to the Constitution that industrialization would bring; many of the founders thought of wage labor as little better than slavery and hoped that America could remain an agrarian society.

Of course, the fears about industrialization were realized, and by the late 19th century, in the Gilded Age, income inequality had reached levels comparable to those we see today. In perhaps the most original part of his book, Sitaraman, an associate professor of law at Vanderbilt Law School, highlights the achievements of the Progressive movement, one of whose aims was taming inequality, and which successfully modified the Constitution. There were four constitutional amendments in seven years - the direct election of senators, the franchise for women, the prohibition of alcohol and the income tax. To which I would add another reform, the establishment of the Federal Reserve, which provided a mechanism for handling financial crises without the need for the government to be bailed out by rich bankers, as well as the reduction in the tariff, which favored ordinary people by bringing down the cost of manufactures. Politics can respond to inequality, and the Constitution is not set in stone.

What of today, when inequality is back in full force? ...

Angus Deaton, a professor emeritus at Princeton, was awarded the Nobel in economic science in 2015.

anne -> anne... , March 25, 2017 at 11:26 AM
https://www.brookings.edu/wp-content/uploads/2017/03/6_casedeaton.pdf

March 17, 2017

Mortality and morbidity in the 21st century
By Anne Case and Angus Deaton

Summary

We build on and extend the findings in Case and Deaton (2015 * ) on increases in mortality and morbidity among white non-Hispanic Americans in midlife since the turn of the century. Increases in all-cause mortality continued unabated to 2015, with additional increases in drug overdoses, suicides, and alcoholic-related liver mortality, particularly among those with a high-school degree or less. The decline in mortality from heart disease has slowed and, most recently, stopped, and this combined with the three other causes is responsible for the increase in all-cause mortality. Not only are educational differences in mortality among whites increasing, but mortality is rising for those without, and falling for those with, a college degree. This is true for non-Hispanic white men and women in all age groups from 25-29 through 60-64. Mortality rates among blacks and Hispanics continue to fall; in 1999, the mortality rate of white non-Hispanics aged 50-54 with only a high-school degree was 30 percent lower than the mortality rate of blacks in the same age group; by 2015, it was 30 percent higher. There are similar crossovers between white and black mortality in all age groups from 25-29 to 60-64.

Mortality rates in comparable rich countries have continued their pre-millennial fall at the rates that used to characterize the US. In contrast to the US, mortality rates in Europe are falling for those with low levels of educational attainment, and are doing so more rapidly than mortality rates for those with higher levels of education.

Many commentators have suggested that the poor mortality outcomes can be attributed to slowly growing, stagnant, and even declining incomes; we evaluate this possibility, but find that it cannot provide a comprehensive explanation. In particular, the income profiles for blacks and Hispanics, whose mortality has fallen, are no better than those for whites. Nor is there any evidence in the European data that mortality trends match income trends, in spite of sharply different patterns of median income across countries after the Great Recession.

We propose a preliminary but plausible story in which cumulative disadvantage over life, in the labor market, in marriage and child outcomes, and in health, is triggered by progressively worsening labor market opportunities at the time of entry for whites with low levels of education. This account, which fits much of the data, has the profoundly negative implication that policies, even ones that successfully improve earnings and jobs, or redistribute income, will take many years to reverse the mortality and morbidity increase, and that those in midlife now are likely to do much worse in old age than those currently older than 65. This is in contrast to an account in which resources affect health contemporaneously, so that those in midlife now can expect to do better in old age as they receive Social Security and Medicare. None of this implies that there are no policy levers to be pulled; preventing the over-prescription of opioids is an obvious target that would clearly be helpful.

* http://www.pnas.org/content/early/2015/10/29/1518393112

Peter K. -> anne... , March 25, 2017 at 01:18 PM
"Of course, the fears about industrialization were realized, and by the late 19th century, in the Gilded Age, income inequality had reached levels comparable to those we see today. In perhaps the most original part of his book, Sitaraman, an associate professor of law at Vanderbilt Law School, highlights the achievements of the Progressive movement, one of whose aims was taming inequality, and which successfully modified the Constitution. There were four constitutional amendments in seven years - the direct election of senators, the franchise for women, the prohibition of alcohol and the income tax. To which I would add another reform, the establishment of the Federal Reserve, which provided a mechanism for handling financial crises without the need for the government to be bailed out by rich bankers, as well as the reduction in the tariff, which favored ordinary people by bringing down the cost of manufactures. "

It's interesting that the language of inequality is the language of technocrats, however worthy. It's a way to talk about the politics without referring to Marxist or populist/labor traditions which often involve social movements.

[Mar 25, 2017] Its interesting that the language of inequality is the language of technocrats, however worthy. Its a way to talk about the politics without referring to Marxist or populist/labor traditions which often involve social movements

Mar 25, 2017 | economistsview.typepad.com
anne -> anne... , March 25, 2017 at 11:26 AM
https://www.brookings.edu/wp-content/uploads/2017/03/6_casedeaton.pdf

March 17, 2017

Mortality and morbidity in the 21st century
By Anne Case and Angus Deaton

Summary

We build on and extend the findings in Case and Deaton (2015 * ) on increases in mortality and morbidity among white non-Hispanic Americans in midlife since the turn of the century. Increases in all-cause mortality continued unabated to 2015, with additional increases in drug overdoses, suicides, and alcoholic-related liver mortality, particularly among those with a high-school degree or less. The decline in mortality from heart disease has slowed and, most recently, stopped, and this combined with the three other causes is responsible for the increase in all-cause mortality. Not only are educational differences in mortality among whites increasing, but mortality is rising for those without, and falling for those with, a college degree. This is true for non-Hispanic white men and women in all age groups from 25-29 through 60-64. Mortality rates among blacks and Hispanics continue to fall; in 1999, the mortality rate of white non-Hispanics aged 50-54 with only a high-school degree was 30 percent lower than the mortality rate of blacks in the same age group; by 2015, it was 30 percent higher. There are similar crossovers between white and black mortality in all age groups from 25-29 to 60-64.

Mortality rates in comparable rich countries have continued their pre-millennial fall at the rates that used to characterize the US. In contrast to the US, mortality rates in Europe are falling for those with low levels of educational attainment, and are doing so more rapidly than mortality rates for those with higher levels of education.

Many commentators have suggested that the poor mortality outcomes can be attributed to slowly growing, stagnant, and even declining incomes; we evaluate this possibility, but find that it cannot provide a comprehensive explanation. In particular, the income profiles for blacks and Hispanics, whose mortality has fallen, are no better than those for whites. Nor is there any evidence in the European data that mortality trends match income trends, in spite of sharply different patterns of median income across countries after the Great Recession.

We propose a preliminary but plausible story in which cumulative disadvantage over life, in the labor market, in marriage and child outcomes, and in health, is triggered by progressively worsening labor market opportunities at the time of entry for whites with low levels of education. This account, which fits much of the data, has the profoundly negative implication that policies, even ones that successfully improve earnings and jobs, or redistribute income, will take many years to reverse the mortality and morbidity increase, and that those in midlife now are likely to do much worse in old age than those currently older than 65. This is in contrast to an account in which resources affect health contemporaneously, so that those in midlife now can expect to do better in old age as they receive Social Security and Medicare. None of this implies that there are no policy levers to be pulled; preventing the over-prescription of opioids is an obvious target that would clearly be helpful.

* http://www.pnas.org/content/early/2015/10/29/1518393112

Peter K. -> anne... , March 25, 2017 at 01:18 PM
"Of course, the fears about industrialization were realized, and by the late 19th century, in the Gilded Age, income inequality had reached levels comparable to those we see today. In perhaps the most original part of his book, Sitaraman, an associate professor of law at Vanderbilt Law School, highlights the achievements of the Progressive movement, one of whose aims was taming inequality, and which successfully modified the Constitution. There were four constitutional amendments in seven years - the direct election of senators, the franchise for women, the prohibition of alcohol and the income tax. To which I would add another reform, the establishment of the Federal Reserve, which provided a mechanism for handling financial crises without the need for the government to be bailed out by rich bankers, as well as the reduction in the tariff, which favored ordinary people by bringing down the cost of manufactures. "

It's interesting that the language of inequality is the language of technocrats, however worthy. It's a way to talk about the politics without referring to Marxist or populist/labor traditions which often involve social movements.

[Mar 25, 2017] Angry Bear " U.S. Has Worst Wealth Inequality of Any Rich Nation, and It's Not Even Close

Mar 25, 2017 | angrybearblog.com
U.S. Has Worst Wealth Inequality of Any Rich Nation, and It's Not Even Close

Kenneth Thomas | March 19, 2017 6:07 am

Hot Topics I've discussed the Credit Suisse Global Wealth Reports before, an excellent source of data for both wealth and wealth inequality. The most recent edition , from November 2016, shows the United States getting wealthier, but steadily more unequal in wealth per adult and dropping from 25th to 27th in median wealth per adult since 2014. Moreover, on a global scale, it reports that the top 1% of wealth holders hold 50.8% of the world's wealth (Report, p. 18).

One important point to bear in mind is that while the United States remains the fourth-highest country for wealth per adult (after Switzerland, Iceland, and Australia) at $344,692, its median wealth per adult has fallen to 27th in the world, down to $44,977. As I have pointed out before, the reason for this is much higher inequality in the U.S. In fact, the U.S. ratio of mean to median wealth per adult is 7.66:1, the highest of all rich countries by a long shot.

The tables below illustrate this. First, I will present the 29 countries with median wealth per adult over $40,000 per year, from largest to smallest. The second table also includes mean wealth per adult and the mean/median ratio, sorted by the inequality ratio.

1. Switzerland $244,002
2. Iceland $188,088
3. Australia $162,815
4. Belgium $154,815
5. New Zealand $135,755
6. Norway $135,012
7. Luxembourg $125,452
8. Japan $120,493
9. United Kingdom $107,865
10. Italy $104,105
11. Singapore $101,386
12. France $ 99,923
13. Canada $ 96,664
14. Netherlands $ 81,118
15. Ireland $ 80,668
16. Qatar $ 74,820
17. Korea $ 64,686
18. Taiwan $ 63,134
19. United Arab Emirates $ 62,332
20. Spain $ 56,500
21. Malta $ 54,562
22. Israel $ 54,384
23. Greece $ 53,266
24. Austria $ 52,519
25. Finland $ 52,427
26. Denmark $ 52,279
27. United States $ 44,977
28. Germany $ 42,833
29. Kuwait $ 40,803

Source: Credit Suisse Global Wealth Databook 2016, Table 3-1

Now that I've got your attention, let me remind you why this low level of median wealth is a BIG PROBLEM. Quite simply, we are careening towards a retirement crisis as Baby Boomers like myself find their income drop off a cliff in retirement. As I reported in 2013 , 49% (!) of all private sector workers have no retirement plan at all, not even a crappy 401(k). 31% have only a 401(k), which shifts all the investment risk on to the individual, rather than pooling that risk as Social Security does. And many people had to borrow against their 401(k) during the Great Recession, including 1/3 of people in their forties . The overall savings shortfall is $6.6 trillion! If Republican leaders finally get their wish to gut Social Security, prepare to see levels of elder poverty unlike anything in generations. It will not be pretty.

Let's move now to the inequality data, where I'll present median wealth per adult, mean wealth per adult, and the mean-to-median ratio, a significant indicator of inequality. These data will be sorted by that ratio.

1. United States $ 44,977 $344,692 7.66
2. Denmark $ 52,279 $259,816 4.97
3. Germany $ 42,833 $185,175 4.32
4. Austria $ 52,519 $206,002 3.92
5. Israel $ 54,384 $176,263 3.24
6. Kuwait $ 40,803 $119,038 2.92
7. Finland $ 52,427 $146,733 2.80
8. Canada $ 96,664 $270,179 2.80
9. Taiwan $ 63,134 $172,847 2.74
10. Singapore $101,386 $276,885 2.73
11. United Kingdom $107,865 $288,808 2.68
12. Ireland $ 80,668 $214,589 2.66
13. Luxembourg $125,452 $316,466 2.52
14. Korea $ 64,686 $159,914 2.47
15. France $ 99,923 $244,365 2.45
16. United Arab Emirates $ 62,332 $151,098 2.42
17. Norway $135,012 $312,339 2.31
18. Australia $162,815 $375,573 2.31
19. Switzerland $244,002 $561,854 2.30
20. Netherlands $ 81,118 $184,378 2.27
21. New Zealand $135,755 $298,930 2.20
22. Iceland $188,088 $408,595 2.17
23. Qatar $ 74,820 $161,666 2.16
24. Malta $ 54,562 $116,185 2.13
25. Spain $ 56,500 $116,320 2.06
26. Greece $ 53,266 $103,569 1.94
27. Italy $104,105 $202,288 1.94
28. Japan $120,493 $230,946 1.92
29. Belgium $154,815 $270,613 1.75

Source: Author's calculations from Credit Suisse Global Wealth Databook 2016, Table 3-1

As you can see, the U.S. inequality ratio is more than 50% higher than #2 Denmark and fully three times as high as the median country on the list, France. As the title says, this is not even close.

The message couldn't be clearer: Get down to your town halls and let your Senators and Representatives know that it's time to raise Social Security benefits and forget the nonsense of cutting them.

Cross-posted from Middle Class Political Economist .

[Mar 25, 2017] New Health Care Plan: Open Source Drugs, Immigrant Doctors, and a Public Option

Mar 25, 2017 | economistsview.typepad.com
anne : March 25, 2017 at 07:54 AM , 2017 at 07:54 AM
http://cepr.net/blogs/beat-the-press/new-health-care-plan-open-source-drugs-immigrant-doctors-and-a-public-option

March 25, 2017

New Health Care Plan: Open Source Drugs, Immigrant Doctors, and a Public Option

Now that the Republican health care plan has been sent to the dust bin of history, it's worth thinking about how Obamacare can be improved. While the Affordable Care Act was a huge step forward in extending insurance coverage, many of the complaints against the program are justified. The co-pays and deductibles can mean the plans are of little use to middle income people with relatively low bills.

This is a great time to put forward ideas for reducing these costs and making other changes in the health care system. Obviously this congress and president are not interested in reforms that help low and middle income families, but the rest of us can start pushing these ideas now, with the expectation that the politicians will eventually come around.

There are two obvious directions to go to get costs down for low and middle income families. One is to increase taxes on the wealthy. The other is to reduce the cost of health care. The latter is likely the more promising option, especially since we have such a vast amount of waste in our system. The three obvious routes are lower prices for prescription drugs and medical equipment, reducing the pay of doctors, and savings on administrative costs from having Medicare offer an insurance plan in the exchanges.

Taking these in turn, the largest single source of savings would be reducing what we pay for prescription drugs. We will spend over $440 billion this year for drugs that would likely sell for less than $80 billion in a free market without patent monopolies and other forms of protection. If we paid as much as people in other wealthy countries for our drugs, we would save close to $200 billion a year. We spend another $50 billion a year on medical equipment which would likely cost around $15 billion in a free market.

If the government negotiated prices for drugs and medical equipment its savings could easily exceed $100 billion a year (see "Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer" * ). It could use some of these savings to finance open-source research for new drugs and medical equipment.

We already fund a huge amount of research, so this is not some radical departure from current practice. The government spends more than $32 billion on research conducted by the National Institutes of Health. It also picks up 50 percent of the industry's research costs on orphan drugs through the Orphan Drug Tax Credit. Orphan drugs are a rapidly growing share of all drug approvals, as the industry increasingly takes advantage of this tax credit.

The big change would not be that the government was funding research, but rather the research results and patents would be in the public domain, rather than be used by Pfizer and other drug companies to get patent monopolies. As a result, the next great breakthrough drug will sell as a generic for a few hundred dollars rather than hundreds of thousands of dollars. And MRI scans would cost little more than X-rays.

The second big potential source of savings would come from reducing the protectionist barriers which largely exclude foreign-trained physicians. Under current law, a foreign doctor is prohibited from practicing in the United States unless they complete a U.S. residency program. This keeps hundreds of thousands of well-qualified from physicians from practicing in the United States. As a result, our doctors earn on average more than $250,000 a year, roughly twice the average pay in other wealthy countries. (There are similar protectionist restrictions which inflate the pay of dentists.)

If we removed this barrier and allowed qualified foreign doctors to practice in the United States, we would likely get their pay down to levels comparable to that of doctors in countries like Canada and Germany. This could save us close to $100 billion a year on our health care bill, at least half of which would be savings to the government.

There is a concern that we would attract more doctors from developing countries. We could easily offset this brain drain by paying these countries enough so that they can train two or three doctors for every one that comes to the United States, thereby ensuring they gain from this arrangement as well. It is worth noting that these countries receive zero compensation now for the doctors they pay to train, but who then practice in the United States.

The third big source of saving would be having Medicare offer an insurance plan in the exchanges. This would ensure both that everyone had at least one good option regardless of where they lived and also that the private insurers in the system would face real competition. In 2010, the Congressional Budget Office projected that a public option would save the government $23 billion a year by 2020 and $29 billion by 2023.

The total savings to the government from these three changes easily exceed $150 billion a year, in addition to large savings that individuals outside the exchanges would see in their health care expenses. This is far more than enough to make the deductibles zero for each of the roughly 10 million people now in the exchanges. That would make Obamacare considerably more attractive.

Of course if the plans in the exchanges became more generous more people would opt to take advantage of them and we would see people leaving employer-provided plans. That is a problem that we can deal with at the time it happens. (We would need to have a portion of workers' current payments for employer provided plans go to the government to cover the cost of additional enrollees in the exchanges.) But the way forward in improving Obamacare is to use the market to make our health care system more efficient and reduce the ridiculous rents that now go to the wealthy as a result of waste in the system.

* http://deanbaker.net/images/stories/documents/Rigged.pdf

-- Dean Baker

anne -> anne... , March 25, 2017 at 07:56 AM
http://deanbaker.net/images/stories/documents/Rigged.pdf

October, 2016

Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer
By Dean Baker

The Old Technology and Inequality Scam: The Story of Patents and Copyrights

One of the amazing lines often repeated by people in policy debates is that, as a result of technology, we are seeing income redistributed from people who work for a living to the people who own the technology. While the redistribution part of the story may be mostly true, the problem is that the technology does not determine who "owns" the technology. The people who write the laws determine who owns the technology.

Specifically, patents and copyrights give their holders monopolies on technology or creative work for their duration. If we are concerned that money is going from ordinary workers to people who hold patents and copyrights, then one policy we may want to consider is shortening and weakening these monopolies. But policy has gone sharply in the opposite direction over the last four decades, as a wide variety of measures have been put into law that make these protections longer and stronger. Thus, the redistribution from people who work to people who own the technology should not be surprising - that was the purpose of the policy.

If stronger rules on patents and copyrights produced economic dividends in the form of more innovation and more creative output, then this upward redistribution might be justified. But the evidence doesn't indicate there has been any noticeable growth dividend associated with this upward redistribution. In fact, stronger patent protection seems to be associated with slower growth.

Before directly considering the case, it is worth thinking for a minute about what the world might look like if we had alternative mechanisms to patents and copyrights, so that the items now subject to these monopolies could be sold in a free market just like paper cups and shovels.

The biggest impact would be in prescription drugs. The breakthrough drugs for cancer, hepatitis C, and other diseases, which now sell for tens or hundreds of thousands of dollars annually, would instead sell for a few hundred dollars. No one would have to struggle to get their insurer to pay for drugs or scrape together the money from friends and family. Almost every drug would be well within an affordable price range for a middle-class family, and covering the cost for poorer families could be easily managed by governments and aid agencies.

The same would be the case with various medical tests and treatments. Doctors would not have to struggle with a decision about whether to prescribe an expensive scan, which might be the best way to detect a cancerous growth or other health issue, or to rely on cheaper but less reliable technology. In the absence of patent protection even the most cutting edge scans would be reasonably priced.

Health care is not the only area that would be transformed by a free market in technology and creative work. Imagine that all the textbooks needed by college students could be downloaded at no cost over the web and printed out for the price of the paper. Suppose that a vast amount of new books, recorded music, and movies was freely available on the web.

People or companies who create and innovate deserve to be compensated, but there is little reason to believe that the current system of patent and copyright monopolies is the best way to support their work. It's not surprising that the people who benefit from the current system are reluctant to have the efficiency of patents and copyrights become a topic for public debate, but those who are serious about inequality have no choice. These forms of property claims have been important drivers of inequality in the last four decades.

The explicit assumption behind the steps over the last four decades to increase the strength and duration of patent and copyright protection is that the higher prices resulting from increased protection will be more than offset by an increased incentive for innovation and creative work. Patent and copyright protection should be understood as being like very large tariffs. These protections can often the raise the price of protected items by several multiples of the free market price, making them comparable to tariffs of several hundred or even several thousand percent. The resulting economic distortions are comparable to what they would be if we imposed tariffs of this magnitude.

The justification for granting these monopoly protections is that the increased innovation and creative work that is produced as a result of these incentives exceeds the economic costs from patent and copyright monopolies. However, there is remarkably little evidence to support this assumption. While the cost of patent and copyright protection in higher prices is apparent, even if not well-measured, there is little evidence of a substantial payoff in the form of a more rapid pace of innovation or more and better creative work....

geoff -> anne... , March 25, 2017 at 08:43 AM
Medicare for all is a great idea but still well out of political reach for a while. On the other hand, cheaper drugs is a goal even trumpers could support with the right sales pitch.

the pushers are unusually profitable:

https://www.statista.com/statistics/272720/top-global-biotech-and-pharmaceutical-companies-based-on-net-income/

and they make for a pretty scummy pond in the swamp:

https://www.opensecrets.org/lobby/indusclient.php?id=h04

hey, it could happen here:

https://www.law360.com/articles/903111/canada-prevails-in-383m-eli-lilly-case

Peter K. -> geoff ... , March 25, 2017 at 08:59 AM
Trump met with the heads of the drug companies and decided the solutions was more deregulation.
DeDude -> anne... , March 25, 2017 at 10:23 AM
I generally love most of what Dean Baker does. But his weaknesses are on display in this piece. Just enough insights to sound convincing, but not enough to be the real McCoy. Yes we pay our medical doctors a lot more than France. However, ours first come out of undergraduate training having paid over $200K for that, then add another $300K for medical school. So that is a cool $500K in debt that their French counterparts don't have to deal with. Next (and before they can se any patients are internships (3 years) where they are not paid enough to begin paying down the student debt, followed by another 2-5 years of specialty training again with a compensation that cover living but not paying down the debt. Finally after becoming specialists (and those who don't are not paid $250K per year), they can begin paying down that student debt which in the meantime has grown substantially (with its private market interest rates).

If you were to put all those foreigners with their free education in direct competition with the domestic crop there would be no US born doctors. But that would be the least of the problems. American medical schools are for the most part outstanding and even the least of those graduating are quite good. That cannot be said for many of the other places in the world where we get most of our foreign trained doctors. There is a very good reason we demand that foreigners go through a US residency program before they can practice medicine. Regardless of what their (real or fake) papers say about their education, they have to perform up to US standards to pass the US residency programs and be licensed – and that is a good thing.

anne : , March 25, 2017 at 08:10 AM
https://www.nytimes.com/2017/03/24/upshot/health-insurance-medicare-obamacare-american-health-care-act.html?ref=business

March 24, 2017

What Comes Next for Obamacare? The Case for Medicare for All
By ROBERT H. FRANK

Republicans are in a bind. They've been promising to repeal Obamacare for seven years, and having won control of the White House and Congress, they had to try to deliver. But while their bitter denunciations of the Affordable Care Act may have depressed its approval numbers, they didn't make replacing it any easier.

On the contrary, the repeal-and-replace bill designed by House Speaker Paul D. Ryan drew withering criticism from the left and the right. Liberals condemned its use of reductions in health coverage for the poor to pay for large tax cuts for the wealthy, while conservatives bemoaned its retention of many subsidies adopted under Obamacare.

In the end, the repeal effort's biggest hurdle may have been loss aversion, one of the most robust findings in behavioral science. As numerous studies have shown, the pain of losing something you already have is much greater than the pleasure of having gained it in the first place. And the nonpartisan Congressional Budget Office estimated that Mr. Ryan's American Health Care Act (A.H.C.A.) would have caused more than 14 million people to lose coverage in the first year alone, with total losses rising to 24 million over the next decade. Many Republicans in Congress were nervous about the political firestorm already provoked by the mere prospect of such losses.

Loss aversion actually threatened the repeal effort on two fronts: voters' fear of losing their coverage, and lawmakers' fear of losing their seats. Like the first fear, the second appeared well grounded. Republican voters wouldn't have been the only ones losing coverage, of course, but early studies suggested that losses would have been concentrated among people who voted for President Trump. The Congressional Budget Office estimated, for example, that the A.H.C.A. would have caused premiums to rise more than sevenfold in 2026 for 64-year-olds making $26,500.

Now that Republicans have withdrawn Mr. Ryan's bill from consideration, attention shifts to what comes next. In an earlier column, I suggested that Mr. Trump has the political leverage, which President Obama did not, to jettison the traditional Republican approach in favor of a form of the single-payer health care that most other countries use. According to Physicians for a National Health Program, an advocacy group, "Single-payer national health insurance, also known as 'Medicare for all,' is a system in which a single public or quasi-public agency organizes health care financing, but the delivery of care remains largely in private hands." Christopher Ruddy, a friend and adviser of the president, recently urged him to consider this option.

Many Republicans who want to diminish government's role in health care view the single-payer approach with disdain. But Mr. Trump often seems to take pleasure in being unpredictable, and since he will offend people no matter which way he turns, he may want to consider why liberals and conservatives in many other countries have embraced the single-payer approach.

Part of the appeal of Medicare for all is that single-payer systems reduce financial incentives that generate waste and abuse. Mr. Ryan insisted that by relegating health care to private insurers, competition would lead to lower prices and higher quality. Economic theory tells us that this is a reasonable expectation when certain conditions are met. A crucial one is that buyers must be able to compare the quality of offerings of different sellers. In practice, however, people have little knowledge of the treatment options for the various maladies they might suffer, and policy language describing insurance coverage is notoriously complex and technical. Consumers simply cannot make informed quality comparisons in this industry.

In contrast, they can easily compare the prices charged by competing insurance companies. This asymmetry induces companies to compete by highlighting the lower prices they're able to offer if they cut costs by degrading the quality of their offerings. For example, it's common for insurance companies to deny payment for procedures that their policies seem to cover. If policy holders complain loudly enough, they may eventually get reimbursed, but the money companies save by not paying others confers a decisive competitive advantage over rivals that don't employ this tactic. Such haggling is uncommon under single-payer systems like Medicare (though it is sometimes employed by private insurers that supplement Medicare).

Consider, too, the mutually offsetting expenditures on competitive advertising and other promotional efforts of private insurers, which can exceed 15 percent of total revenue. Single-payer plans like Medicare spend nothing on competitive advertising (although here, also, we see such expenditures by supplemental insurers).

According to the Kaiser Family Foundation, administrative costs in Medicare are only about 2 percent of total operating expenditures, less than one-sixth of the rate estimated for the private insurance industry. This difference does not mean that private insurers are evil. It's a simple consequence of a difference in the relevant economic incentives.

American health care outlays per capita in 2015 were more than twice the average of those in the 35 advanced countries that make up the Organization for Economic Cooperation and Development. Yet despite that spending difference, the system in the United States delivers significantly less favorable outcomes on measures like longevity and the incidence of chronic illness....

anne -> anne... , March 25, 2017 at 08:15 AM
http://www.oecd.org/health/health-systems/oecd-health-statistics-2014-frequently-requested-data.htm

November, 2016

Organisation for Economic Co-operation and Development Health Data

Total health care spending per person, 2015 *

United States ( 9451)
OCED average ( 3814)

France ( 4407)

Total health care spending as a share of GDP, 2015

United States ( 16.9)
OCED average ( 9.0)

France ( 11.0)

Pharmaceutical expenditure per person, 2014 *

United States ( 1112)
OECD average ( 538)

France ( 656)

Practising physicians per 1,000 population, 2014

United States ( 2.6)
OECD average ( 3.3)

France ( 3.3)

Practising nurses per 1,000 population, 2014

United States ( 11.2)
OECD average ( 8.9)

France ( 9.6)

Physician consultations per person, 2014

United States ( 4.0)
OECD average ( 6.8)

France ( 6.3)

Medical graduates per 100,000 population, 2014

United States ( 7.3)
OECD average ( 11.4)

France ( 10.0)

* Data are expressed in US dollars adjusted for purchasing power parities (PPPs), which provide a means of comparing spending between countries on a common base. PPPs are the rates of currency conversion that equalise the cost of a given "basket" of goods and services in different countries.

[Mar 25, 2017] The good news is they now own health care. They now own Obamacare saidTrump

Mar 25, 2017 | economistsview.typepad.com
Fred C. Dobbs : , March 25, 2017 at 07:35 AM
In a Call to The Times, Trump Blames Democrats for the
Failure of the Health Bill https://nyti.ms/2nNPHD9
NYT - MAGGIE HABERMAN - MARCH 24, 2017

WASHINGTON - Just moments after the Republican plan to repeal and replace the Affordable Care Act was declared dead, President Trump sought to paint the defeat of his first legislative effort as an early-term blip.

The House speaker, Paul D. Ryan, was preparing to tell the public that the health care bill was being withdrawn - a byproduct, Mr. Trump said, of Democratic partisanship. The president predicted that Democrats would return to him to make a deal in roughly a year.

"Look, we got no Democratic votes. We got none, zero," Mr. Trump said in a telephone interview he initiated with The New York Times.

"The good news is they now own health care. They now own Obamacare."

Mr. Trump insisted that the Affordable Care Act would collapse in the next year, which would then force Democrats to come to the bargaining table for a new bill.

"The best thing that can happen is that we let the Democrats, that we let Obamacare continue, they'll have increases from 50 to 100 percent," he said. "And when it explodes, they'll come to me to make a deal. And I'm open to that."

Although enrollment in the Affordable Care Act declined slightly in the past year, there is no sign that it is collapsing. Its expansion of Medicaid continues to grow.

In a later phone interview with The Times, the Senate minority leader, Chuck Schumer, ridiculed Mr. Trump's remarks about Democrats being at fault.

"Whenever the president gets in trouble, he points fingers of blame," Mr. Schumer said. "It's about time he stopped doing that and started to lead. The Republicans were totally committed to repeal from the get-go, never talked to us once. But now that they realize that repeal can't work, if they back off repeal, of course we'll work with them to make it even better."

Mr. Trump said that "when they come to make a deal," he would be open and receptive. He singled out the Tuesday Group moderates for praise, calling them "terrific," an implicit jab at the House Freedom Caucus, which his aides had expressed frustration with during negotiations. ...

Fred C. Dobbs -> Fred C. Dobbs... , March 25, 2017 at 08:02 AM
On health-care, as on so much else,
President Trump passes the buck, reports
https://www.theatlantic.com/politics/archive/2017/03/the-buck-doesnt-stop-here-anymore/520839/
The Atlantic - David A. Graham - March 24, 2017

Speaking in the Oval Office Friday afternoon, President Trump surveyed the wreckage of the Obamacare repeal effort and issued a crisp, definitive verdict: I didn't do it.

The president said he didn't blame Speaker Paul Ryan, though he had plenty of implied criticism for the speaker. "I like Speaker Ryan. He worked very hard," Trump said, but he added: "I'm not going to speak badly about anybody within the Republican Party. Certainly there's a big history. I really think Paul worked hard." He added ruefully that the GOP could have taken up tax-reform first, instead of Obamacare-the reverse of Ryan's desired sequence. "Now we're going to go for tax reform, which I've always liked," he said.

As for the House Freedom Caucus, the bloc of conservatives from which many of the apparent "no" votes on the Republican plan were to come, Trump said, "I'm not betrayed. They're friends of mine. I'm disappointed because we could've had it. So I'm disappointed. I'm a little surprised, I could tell you."

The greatest blame for the bill's failure fell on Democrats, Trump said.

"This really would've worked out better if we could've had Democrat support. Remember we had no Democrat support," Trump said. Later, he added, "But when you get no votes from the other side, meaning the Democrats, it's really a difficult situation."

He said Democrats should come up with their own bill. "I think the losers are Nancy Pelosi and Chuck Schumer, because they own Obamacare," he said, referring to the House and Senate Democratic leaders. "They 100 percent own it."

Trump was very clear about who was not to blame: himself. "I worked as a team player," the president of the United States said, demoting himself to bit-player status. He wanted to do tax reform first, after all, and it was still early. "I've been in office, what, 64 days? I've never said repeal and replace Obamacare within 64 days. I have a long time. I want to have a great health-care bill and plan and we will."

Strictly speaking, it is true that Trump didn't promise to repeal Obamacare on day 64 of his administration. What he told voters, over and over during the campaign, was that he'd do it immediately. On some occasions he or top allies even promised to do it on day 1. Now he and his allies are planning to drop the bill for the foreseeable future.

It is surely not wrong that there is lots of blame to go around. Congressional Republicans had years to devise a plan, and couldn't come up with one that would win a majority in the House, despite a 44-seat advantage. The House bill was an unpopular one, disliked by conservatives and moderates in that chamber; almost certainly dead on arrival in the Senate; and deeply unpopular with voters. Even before the vote was canceled, unnamed White House officials were telling reporters that the plan was to pin the blame on Ryan. ...

The Republicans fold and
withdraw their health-care bill https://www.theatlantic.com/politics/archive/2017/03/trump-republicans-failure-obamacare/520788/
The Atlantic - Russell Berman - March 24, 2017

... Defeat on the floor dealt Trump a major blow early in his presidency, but its implications were far more serious for the Republican Party as a whole. Handed unified control of the federal government for only the third time since World War II, the modern GOP was unable to overcome its internecine fights to enact a key part of its policy agenda. The president now wants to move on to a comprehensive overhaul of the tax code, but insiders on Capitol Hill have long believed that project will be an even heavier lift than health care.

As the prospect of a loss became more real on Friday, the frustrations of GOP lawmakers loyal to the leadership began to boil over. "I've been in this job eight years, and I'm wracking my brain to think of one thing our party has done that's been something positive, that's been something other than stopping something else from happening," Representative Tom Rooney of Florida said in an interview. "We need to start having victories as a party. And if we can't, then it's hard to justify why we should be back here."

Nothing has exemplified the party's governing challenge quite like health care. For years, Republican leaders resisted pressure from Democrats and rank-and-file lawmakers to coalesce around a detailed legislative alternative to Obamacare. That failure didn't prevent them from attaining power, but it forced them to start nearly from scratch after Trump's surprising victory in November. At Ryan's urging, the party had compiled a plan as part of the speaker's "A Better Way" campaign agenda. Translating that into legislation, however, proved a much stiffer challenge; committee leaders needed to navigate a razor's edge to satisfy conservatives demanding a full repeal of Obamacare and satisfy moderates who preferred to keep in place its more popular consumer protections and Medicaid expansion. They were further limited by the procedural rules of the Senate, which circumscribed how far Republicans could go while still avoiding a Democratic filibuster. ...

[Mar 25, 2017] In addition to the public option and age 55+ Medicare buy-in, one thing that might work is abollishing the mandate and penalty and replaciing them with automatic enrollment. Call it Youre employed, youre covered!

Mar 25, 2017 | economistsview.typepad.com
New Deal democrat -> Lee A. Arnold ...

One issue going forward is whether the Dems should offer their own plan. I think they should.

As a few others have pointed out, Trump is not wedded to the GOP establishment. If he thinks he can "WIN bigly!" by allying with Dems, he will do so. I happen to think that he is mainly against "Obamacare" because Obama humiliated him at the White House Correspondents' Dinner once upon a time, and he is nothing if not vengeful. He wants to obliterate Obama's legacy.

So Dems need to make a big stink any time Trump administrativley undercuts Obamacare provisions to try to make it fail. But also they should give him the chance to do something he can call Trumpcare that actually works.

Obamacare does have some major problems (the individual mandate is hated, and the penalty isn't big enough. More young people need to buy in. Some of the Exchanges and health care provider networks are too narrow.

In addition to the "public option" and age 55+ Medicare buy-in, one thing that might work is abollishing the mandate and penalty and replaciing them with automatic enrollment. Call it "You're employed, you're covered!"

Just like SS, Medicare, unemployment and disability deductions to paychecks, establish a Health Care automatic deductible. If your employer offers healthcare, the deductible is reduced by the amount of the premium, all the way to zero if applicable.
If your employer doesn't offer healthcare, if you are under age 40, you are automatically enrolled in the least expensive Bronze plan in your state. If you are 40 or older, you are automatically enrolled in the least expensive Silver plan in your state.

The deductible would also include a small contribution towards Medicaid. Then, if you are unemployed, you are automatically enrolled in Medicaid, but can continue with the silver or bronze plan as above if you choose.

Dems could turmpet such a plan to "Reform and Improve" Obamacare, and campaign on pushing for it if they get a Congressional majority. Call it Trumpcare and President Caligula might sign on.

Reply Saturday, March 25, 2017 at 07:35 AM Lee A. Arnold : , March 25, 2017 at 04:48 AM
"Medicare for all" may be the best battle cry. 65-70% of the U.S. people want a single-payer. Bernie Sanders has effectively destroyed the old Democratic Party and sits in a commanding position as spokesman, he gets 6 TV cameras with an hour's notice and he is probably the most popular politician in the U.S. The Democrats don't have to push it for now, they can wait for news to develop. This is all on the Republicans. Let the managerial disaster of Trump and the utter immorality of the "Freedom Caucus" sink in a little more, this story has "legs" as they say in show biz.
mulp -> Lee A. Arnold ... , -1
Name the Senators, representatives, and governors Bernie Bros have delivered?

Where are the Bernie Bros Newts, Cruz, Marcos, ...?

I'm in my 70th year. Conservatives attacked liberals in the 60s, my youth, as promising free lunches to gain power. But what they really hated was liberals convinced voters to tax all voters to pay for the things most voters wanted everyone to have, BASED ON SOUND ECONOMICS TO MAXIMIZE EFFICIENCY AND WELFARE.

Friedman led the effort to distort theory to eliminate the broad meaning of general welfare in economics. He did it by eliminating the hard connection between labor cost and gdp. He argued that labor costs and consumption can be cut to increase profits, and that contrary to theory, higher profits is more efficient.

Laffer applied operations theory to taxes, as if government was taxing to maximize profits.

Thus supply side theory of profit maximization. The result delivered was the imperative to cut taxes. To cut labor costs. Thus they argued that every economic measure improves if taxes and wages are cut.

Reaganomics would deliver more stuff at lower cost, higher profut, and that makes everyone better off, especially those in poverty. Friedman saw consumption as a bad thing. He wanted higher gdp, less consumption. In other words, he rewrote Adam Smith attack on mercantile economics into a justification of returning to mercantile economic policy.

So, who do Bernie Bros offer as the Milton Friedman and Laffer to create an intellectual foundation to refute Adam Smith, FDR, Keynes, Galbraith, are return to hunter gatherer economics? Who is the economist who can convince us that Marxist economic theory will work, as long as it's not captured by right wing capitalists like Fidel Castro, Chavez, Stalin, Lenin, the founders of Israel, ....

Bernie certainly must be influenced by the same economic theory that created Israel. It grew from the same Marxist roots in Germany that powered Stalin and Lenin. Bernie is a pre-WWII Zionist as best I can tell.

Why wouldn't Bernie deliver Israel governance to the US? How would he prevent the greedy from joining the Movement?

And Israel has the social welfare state system Bernie wants. Hundreds of thousands of men do not work so they can study supported by welfare. Universal health care. Women are very equal in status.

I grew up heating the Zionist Dream, theory, much like Bernie did, but from conservative Indiana. Seemed very idealist virtue becoming reality in the 50s and 60s. I have often used Israel as the example of a good universal health care system, of education, of welfare. Never heard Bernie say, "I want the US to be like Israel." Why not? Why Sweden?

[Mar 25, 2017] The President had come to regret going along with Ryan's idea of making health care his first legislative priority

Notable quotes:
"... The larger lesson here is that conservatism failed and social democracy won. ..."
"... After seven years of fulminating against the Affordable Care Act and promising to replace it with a more free-market-oriented alternative, the House Republicans-who are in the vanguard of the modern conservative movement-failed to come up with a workable and politically viable proposal. Obamacare survived, and that shouldn't be so surprising. When it comes to health-care policy, there is no workable or politically viable conservative alternative. ..."
"... in cutting federal support for Medicaid, they dismantle the element of Obamacare that has been the most successful at insuring more people at a reasonable cost. ..."
"... The evil Obama created Obamacare that was so conservative that conservatives can't find an alternative that benefits the majority of conservatives. ..."
"... Many Republicans who want to diminish government's role in health care view the single-payer approach with disdain. But Mr. Trump often seems to take pleasure in being unpredictable, and since he will offend people no matter which way he turns, he may want to consider why liberals and conservatives in many other countries have embraced the single-payer approach. ..."
Mar 25, 2017 | economistsview.typepad.com

Peter K. : March 25, 2017 at 10:24 AM

http://www.newyorker.com/news/john-cassidy/the-health-care-debacle-was-a-failure-of-conservatism

THE HEALTH-CARE DEBACLE WAS A FAILURE OF CONSERVATISM

By John Cassidy March 24, 2017

Let the recriminations begin! Actually, the health-care-failure finger-pointing got under way well before Friday, when Donald Trump and Paul Ryan cancelled a House vote on the American Health Care Act. A day earlier, aides to the President let it be known that he had come to regret going along with Ryan's idea of making health care his first legislative priority.

In the coming days and weeks, there will be more of this blame shifting, and, in truth, there is plenty of blame to go around. Ryan failed to unify the House Republican caucus. Trump's staff allowed him to endorse a bill that made a mockery of his campaign pledge to provide health insurance for everybody. And Trump himself blundered into a political fiasco, apparently believing he could win over recalcitrant Republican members of Congress simply by popping over to Capitol Hill.

But this is just politics. The larger lesson here is that conservatism failed and social democracy won.

After seven years of fulminating against the Affordable Care Act and promising to replace it with a more free-market-oriented alternative, the House Republicans-who are in the vanguard of the modern conservative movement-failed to come up with a workable and politically viable proposal. Obamacare survived, and that shouldn't be so surprising. When it comes to health-care policy, there is no workable or politically viable conservative alternative.

Of course, that isn't how conservative lawmakers, pundits, and policy wonks will spin this. They will argue that Trump and Ryan betrayed free-market principles: if only they had proposed the outright repeal of Obamacare, and put forward a bill that genuinely liberated the health-care industry from federal intervention, everything would have worked out well. That will be the story-and it is a fairy tale.

The fact is that the health-care industry, which makes up about a sixth of the American economy, isn't like the market for apples or iPhones. For a number of reasons (which economists understand pretty well), it is riven with problems. Serious illnesses can be enormously costly to treat; people don't know when they will get ill; the buyers of health insurance know more about their health than the sellers; and insurers have a strong incentive to avoid providing their product to the sick people who need it the most.

Since the days of Otto von Bismarck, most developed countries have dealt with these problems by setting up a system in which the state provides medical insurance directly, or else mandates and subsidizes the purchase of private insurance, setting strict rules for what sorts of policies can be sold. Obamacare amounts to a hybrid model. It supplements employer-provided insurance, the traditional American way of obtaining health care, with a heavily regulated (and subsidized) individual insurance market and an expanded Medicaid system.

It is far from perfect. But, in combining mandates with subsidies, regulation, and access to a state-administered system for the poverty-stricken and low-paid, it is intellectually coherent. (Many of the problems it has encountered arose because the mandate to purchase insurance hasn't been effectively enforced, and not enough young and healthy individuals have signed up.) Since it leaves in place the basic structure of private insurance and private provision, Obamacare is also conservative. As is well known, parts of it resemble a proposal that the Heritage Foundation put forward in 1992.

Today's conservatives act as if they can simply wish away some of the problems that Obamacare was created to deal with. The original version of the American Health Care Act left in place many of the A.C.A.'s regulations but cut back the subsidies and gutted its Medicaid expansion. Had it been enacted, it would have led to higher premiums, at least in the short term, and a huge drop in coverage-twenty-four million people over ten years, according to the Congressional Budget Office. As these implications of the G.O.P. proposal became known to the public, the plan's approval rating fell and fell. In the end, according to a Quinnipiac poll, only nineteen per cent of Americans supported it.

The Freedom Caucus, a group of right-wing conservatives in the House, wanted a bill that stripped away more regulations, which they claimed would enable insurers to offer cheaper and more flexible plans. On the eve of the vote, Ryan agreed to change a clause defining the "essential health benefits" that insurers are required to provide if they sell policies on the Obamacare exchanges-benefits including maternity and mental-health services. But this change would have created two insurmountable problems.

Once insurers were able to craft individual policies without adhering to any list of required benefits, buyers would self-select. Young, healthy people would choose cheap, crappy policies, and older, sicker people would choose more comprehensive policies. Insurers, knowing this, would raise the prices of the good policies. "Worthless policies would get really cheap, but comprehensive policies would get astronomically expensive," Mother Jones's Kevin Drum pointed out. "Virtually no one would be able to afford them."

The other problem was political. Americans need maternity coverage, mental-health benefits, prescription drugs, pediatric services, lab tests, and the other things included on the list of essential health benefits. When moderate Republicans in places like New York, New Jersey, and Pennsylvania heard that these services might be eliminated under the amended legislation, they abandoned it in significant numbers. It was their desertion that ultimately killed the bill.

O.K., you might say: The American Health Care Act was a disaster, but what about all the other Republican health-care proposals that are out there? Maybe one of them provides a workable alternative to Obamacare. Let's briefly look at a few of them.

When he was in Congress, Tom Price, the Secretary of Health and Human Services, who supported the A.H.C.A., put forward a bill of his own. But it was basically a less generous version of the bill that just died: in gutting Medicaid and strictly limiting federal funding for high-risk pools to insure sick people, it would surely lead to a big rise in the number of uninsured. Something similar applies to a bill put forward by Senator Orrin Hatch, who chairs the Senate Finance Committee.

There are a few other plans kicking around conservative think tanks, some of which, like Obamacare, tie the level of subsidies to income. But all of these plans have other serious problems. In eschewing purchasing mandates, they run into the issue of younger people being unlikely to sign up for coverage. In giving insurers more freedom to offer different plans and different pricing structures, they encourage self-selection and undermine the risk-pooling that is at the heart of successful insurance schemes. And in cutting federal support for Medicaid, they dismantle the element of Obamacare that has been the most successful at insuring more people at a reasonable cost.

Another Republican plan that may now attract some attention is the proposal put forward by Senators Bill Cassidy, of Louisiana, and Susan Collins, of Maine. But, far from dismantling Obamacare, the Cassidy-Collins plan would allow big, populous states like New York and California to keep the current system in place, including the Medicaid expansion and the surtaxes on high earners. Red states that don't like Obamacare would be able to take federal money and design their own systems to provide basic, catastrophic coverage plans to everybody.

Because it retains so much of Obamacare, this proposal seems unlikely to receive majority support inside the G.O.P. In the coming weeks, Republicans in the Senate and the House will be trying anew to come up with an alternative that they can unite around, portray as a big break from the A.C.A., and sell to the American public. The lesson of the past few weeks is that they are likely to fail. As a novice to the subject noted recently, health care is complicated. Too complicated for ad-hoc policymaking and simplistic conservative nostrums.

mulp -> Peter K.... , March 25, 2017 at 10:44 AM
The evil Obama created Obamacare that was so conservative that conservatives can't find an alternative that benefits the majority of conservatives.

A few conservatives have prided themselves on commuting suicide by not treating their cancer in principled opposition to Obamacare, but most simply bitch about the high premiums which requires they get huge Obamacare tax credits while still paying a lot out of pocket because they bought the high deductible policy that makes the patient have skin in the game.

They want patients to pay out off a savings account to have skin in the game without needing to actually "save" to fill the HSA and have low premiums for insurance you buy with cancer treatment only when you have cancer. After all, if you buy insurance without cancer coverage, you qualify to buy insurance with cancer treatment because you have continuously bought insurance for five years.

... ... ...

Peter K. : , March 25, 2017 at 10:32 AM
https://www.nytimes.com/2017/03/24/upshot/health-insurance-medicare-obamacare-american-health-care-act.html?partner=rss&emc=rss&_r=1

"...

Now that Republicans have withdrawn Mr. Ryan's bill from consideration, attention shifts to what comes next. In an earlier column, I suggested that Mr. Trump has the political leverage, which President Obama did not, to jettison the traditional Republican approach in favor of a form of the single-payer health care that most other countries use. According to Physicians for a National Health Program, an advocacy group, "Single-payer national health insurance, also known as 'Medicare for all,' is a system in which a single public or quasi-public agency organizes health care financing, but the delivery of care remains largely in private hands." Christopher Ruddy, a friend and adviser of the president, recently urged him to consider this option.

Many Republicans who want to diminish government's role in health care view the single-payer approach with disdain. But Mr. Trump often seems to take pleasure in being unpredictable, and since he will offend people no matter which way he turns, he may want to consider why liberals and conservatives in many other countries have embraced the single-payer approach.

..."


[Mar 25, 2017] The issue isn't about loyalty . The issue is about establishing reasonable and affordable healthcare for at least the majority of American citizens that have gross earnings under a hundred thousands annually

Mar 25, 2017 | economistsview.typepad.com
llisa2u2, March 25, 2017 at 08:30 AM
President Donald Trump said on Friday that he was disappointed that a conservative faction in the House of Representatives blocked his healthcare legislation and said "we learned a lot about loyalty" from the effort. OMG. Who's playing political games? Who is NOT focused on not draining anything, except draining the pockets of the "relatively poor" majority for the profits of a "relatively wealthy" majority?

The issue isn't about "loyalty". The issue is about establishing reasonable and affordable healthcare for at least the majority of American citizens that have gross earnings under $250,000 annually.

Peter K. , March 25, 2017 at 08:36 AM
Neoliberal DeLong is good on the Insane Clown Posse of the Republican Party.

http://www.bradford-delong.com/2017/03/should-read-it-was-always-just-dingbat-kabuki-all-the-way-down-joe-barton-_representative-r-tx_-asked-by.html#more

Should-Read: It was always just dingbat kabuki all the way down:

Joe Barton: Representative, R-TX: "[Asked by] reporters... why, after Republicans had held dozens of nearly-unanimous votes to repeal ObamaCare...

"... under President Obama, they were getting cold feet now that they control the levers of power. "Sometimes you're playing Fantasy Football and sometimes you're in the real world", [Rep. Joe Barton R-TX] admitted. "We knew the president, if we could get a repeat bill to his desk, it would almost certainly be vetoed. This time we knew if it got to the president's desk it would be signed.""

t has, as far as the Republican congressional caucus is concerned, always been dingbat kabuki--at least, ever since Gingrich's revolt against George H.W. Bush at the start of the 1990s, if not ever since the passage of the Reagan "none of us really understands what's going on with all these numbers" tax cut in 1981.

David Brooks: "Any large vision...

...was beyond the drafters of this legislation.... They were more concerned with what this internal faction.... In 24 hours of ugly machinations, the Trump administration was willing to rip out big elements of the bill and insert big new ones, without regard to substance or ramification. House members were rushed to commit to legislation even while major pieces of it were still in flux... when the Congressional Budget Office had no time to score it, when the effect on health outcomes of actual Americans was an absolute mystery....

This House Republican plan would increase suffering, morbidity and death among the middle class and poor in order to provide tax cuts to the rich. It would cut Medicaid benefits by $880 billion between now and 2026. It would boost the after-tax income for those making more than $1 million a year by 14 percent.... This bill takes the most vicious progressive stereotypes about conservatives and validates them.... This bill has just a 17 percent approval rating....

If we're going to have the rough edges of a populist revolt, you'd think that at least somebody would be interested in listening to the people. But with this bill the Republican leadership sets an all-time new land speed record for forgetting where you came from.... The Republicans can't run policy-making from the White House because they have a marketing guy in charge of the factory. But they can't run policy from Capitol Hill because it's visionless and internally divided.... The politics driving the substance, not the other way around. The new elite is worse than the old elite-and certainly more vapid.

Peter K. -> Peter K.... , March 25, 2017 at 08:37 AM
The irony is that the failure of the neoliberal centrism of Brooks and DeLong to deliver shared prosperity is churning up a populist revolt against the establishment.

[Mar 25, 2017] It's Not Just Unfair: Inequality Is a Threat to Our Governance

Mar 25, 2017 | economistsview.typepad.com
anne : March 25, 2017 at 11:26 AM

, March 25, 2017 at 11:26 AM
https://www.nytimes.com/2017/03/20/books/review/crisis-of-the-middle-class-constitution-ganesh-sitaraman-.html

March 20, 2017

It's Not Just Unfair: Inequality Is a Threat to Our Governance
By ANGUS DEATON

THE CRISIS OF THE MIDDLE-CLASS CONSTITUTION
Why Economic Inequality Threatens Our Republic
By Ganesh Sitaraman

President Obama labeled income inequality "the defining challenge of our time." But why exactly? And why "our time" especially? In part because we now know just how much goes to the very top of the income distribution, and beyond that, we know that recent economic growth, which has been anemic in any case, has accrued mostly to those who were already well-heeled, leaving stagnation or worse for many Americans. But why is this a problem?

Why am I hurt if Mark Zuckerberg develops Facebook, and gets rich on the proceeds? Some care about the unfairness of income inequality itself, some care about the loss of upward mobility and declining opportunities for our kids and some care about how people get rich - hard work and innovation are O.K., but theft, legal or otherwise, is not. Yet there is one threat of inequality that is widely feared, and that has been debated for thousands of years, which is that inequality can undermine governance. In his fine book, both history and call to arms, Ganesh Sitaraman argues that the contemporary explosion of inequality will destroy the American Constitution, which is and was premised on the existence of a large and thriving middle class. He has done us all a great service, taking an issue of overwhelming public importance, delving into its history, helping understand how our forebears handled it and building a platform to think about it today.

As recognized since ancient times, the coexistence of very rich and very poor leads to two possibilities, neither a happy one. The rich can rule alone, disenfranchising or even enslaving the poor, or the poor can rise up and confiscate the wealth of the rich. The rich tend to see themselves as better than the poor, a proclivity that is enhanced and even socially sanctioned in modern meritocracies. The poor, with little prospect of economic improvement and no access to political power, "might turn to a demagogue who would overthrow the government - only to become a tyrant. Oligarchy or tyranny, economic inequality meant the end of the republic."

Some constitutions were written to contain inequalities. In Rome, the patricians ruled, but could be overruled by plebeian tribunes whose role was to protect the poor. There are constitutions with lords and commoners in separate chambers, each with well-defined powers. Sitaraman calls these "class warfare constitutions," and argues that the founding fathers of the United States found another way, a republic of equals. The middle classes, who according to David Hume were obsessed neither with pleasure-seeking, as were the rich, nor with meeting basic necessities, as were the poor, and were thus amenable to reason, could be a firm basis for a republic run in the public interest. There is some sketchy evidence that income and wealth inequality was indeed low in the 18th century, but the crucial point is that early America was an agrarian society of cultivators with an open frontier. No one needed to be poor when land was available in the West.

The founders worried a good deal about people getting too rich. Jefferson was proud of his achievement in abolishing the entail and primogeniture in Virginia, writing the laws that "laid the ax to the root of Pseudoaristocracy." He called for progressive taxation and, like the other founders, feared that the inheritance of wealth would lead to the establishment of an aristocracy. (Contrast this with those today who simultaneously advocate both equality of opportunity and the abolition of estate taxes.) Madison tried to calculate how long the frontier would last, and understood the threat to the Constitution that industrialization would bring; many of the founders thought of wage labor as little better than slavery and hoped that America could remain an agrarian society.

Of course, the fears about industrialization were realized, and by the late 19th century, in the Gilded Age, income inequality had reached levels comparable to those we see today. In perhaps the most original part of his book, Sitaraman, an associate professor of law at Vanderbilt Law School, highlights the achievements of the Progressive movement, one of whose aims was taming inequality, and which successfully modified the Constitution. There were four constitutional amendments in seven years - the direct election of senators, the franchise for women, the prohibition of alcohol and the income tax. To which I would add another reform, the establishment of the Federal Reserve, which provided a mechanism for handling financial crises without the need for the government to be bailed out by rich bankers, as well as the reduction in the tariff, which favored ordinary people by bringing down the cost of manufactures. Politics can respond to inequality, and the Constitution is not set in stone.

What of today, when inequality is back in full force? ...


Angus Deaton, a professor emeritus at Princeton, was awarded the Nobel in economic science in 2015.

anne -> anne... , March 25, 2017 at 11:26 AM
https://www.brookings.edu/wp-content/uploads/2017/03/6_casedeaton.pdf

March 17, 2017

Mortality and morbidity in the 21st century
By Anne Case and Angus Deaton

Summary

We build on and extend the findings in Case and Deaton (2015 * ) on increases in mortality and morbidity among white non-Hispanic Americans in midlife since the turn of the century. Increases in all-cause mortality continued unabated to 2015, with additional increases in drug overdoses, suicides, and alcoholic-related liver mortality, particularly among those with a high-school degree or less. The decline in mortality from heart disease has slowed and, most recently, stopped, and this combined with the three other causes is responsible for the increase in all-cause mortality. Not only are educational differences in mortality among whites increasing, but mortality is rising for those without, and falling for those with, a college degree. This is true for non-Hispanic white men and women in all age groups from 25-29 through 60-64. Mortality rates among blacks and Hispanics continue to fall; in 1999, the mortality rate of white non-Hispanics aged 50-54 with only a high-school degree was 30 percent lower than the mortality rate of blacks in the same age group; by 2015, it was 30 percent higher. There are similar crossovers between white and black mortality in all age groups from 25-29 to 60-64.

Mortality rates in comparable rich countries have continued their pre-millennial fall at the rates that used to characterize the US. In contrast to the US, mortality rates in Europe are falling for those with low levels of educational attainment, and are doing so more rapidly than mortality rates for those with higher levels of education.

Many commentators have suggested that the poor mortality outcomes can be attributed to slowly growing, stagnant, and even declining incomes; we evaluate this possibility, but find that it cannot provide a comprehensive explanation. In particular, the income profiles for blacks and Hispanics, whose mortality has fallen, are no better than those for whites. Nor is there any evidence in the European data that mortality trends match income trends, in spite of sharply different patterns of median income across countries after the Great Recession.

We propose a preliminary but plausible story in which cumulative disadvantage over life, in the labor market, in marriage and child outcomes, and in health, is triggered by progressively worsening labor market opportunities at the time of entry for whites with low levels of education. This account, which fits much of the data, has the profoundly negative implication that policies, even ones that successfully improve earnings and jobs, or redistribute income, will take many years to reverse the mortality and morbidity increase, and that those in midlife now are likely to do much worse in old age than those currently older than 65. This is in contrast to an account in which resources affect health contemporaneously, so that those in midlife now can expect to do better in old age as they receive Social Security and Medicare. None of this implies that there are no policy levers to be pulled; preventing the over-prescription of opioids is an obvious target that would clearly be helpful.

* http://www.pnas.org/content/early/2015/10/29/1518393112

Peter K. -> anne... , March 25, 2017 at 01:18 PM
"Of course, the fears about industrialization were realized, and by the late 19th century, in the Gilded Age, income inequality had reached levels comparable to those we see today. In perhaps the most original part of his book, Sitaraman, an associate professor of law at Vanderbilt Law School, highlights the achievements of the Progressive movement, one of whose aims was taming inequality, and which successfully modified the Constitution. There were four constitutional amendments in seven years - the direct election of senators, the franchise for women, the prohibition of alcohol and the income tax. To which I would add another reform, the establishment of the Federal Reserve, which provided a mechanism for handling financial crises without the need for the government to be bailed out by rich bankers, as well as the reduction in the tariff, which favored ordinary people by bringing down the cost of manufactures. "

It's interesting that the language of inequality is the language of technocrats, however worthy.

It's a way to talk about the politics without referring to Marxist or populist/labor traditions which often involve social movements.

[Mar 25, 2017] Our constitutional dollar democracy with its gerrymandering, limitless congressional revolving doors, SCOTUS unanswerable to the electorate, and first past the post voting provides loads of punch lines, not the least of which is the de facto two party system itself. Two competitors is merely duopoly

Mar 25, 2017 | economistsview.typepad.com
RC AKA Darryl, Ron -> ilsm... , March 25, 2017 at 07:09 AM
There is more than one joke. Our constitutional dollar democracy with its gerrymandering, limitless congressional revolving doors, SCOTUS unanswerable to the electorate, and first past the post voting provides loads of punch lines, not the least of which is the de facto two party system itself. Two competitors is merely duopoly. It takes a minimum of three viable choices to have any returns from competition that are significant to the consumers' preferences. Two competitors merely play off each other in predictable and increasingly ossified patterns.
New Deal democrat -> RC AKA Darryl, Ron... , March 25, 2017 at 07:17 AM
One very big quibble: >>SCOTUS unanswerable to the electorate<<

As bad as the SCOTUS can be, it would be unimaginably worse if it were subject to elections.

The big problem is that the Founders did not imagine life expectancies into the 80s. Throughout the 19th Century, the median time on the bench was about 14 years, and about 1/3 of all Justices served less than 10 years -- they got sick or died. Now the median time on the bench is 25 years, which is totally unacceptable.

If SCOTUS terms were set at 18 years, with a new Justice appointed every 2 years, independence would be preserved without the imposition of the "dead hands." Emeritus Justices could continue to serve on the appellate courts, and provisions would have to be made for deaths or retirements during the 18 year terms, but you get the idea.

RC AKA Darryl, Ron -> New Deal democrat... , March 25, 2017 at 07:36 AM
I did not mean elections. One of my favorite planks of the 1912 Bull Moose Party was the right for popular petition and referendum to overturn an unpopular SCOTUS decision. Roe V. Wade could not be overturned by referendum (which some fear but votes are measured by heat count rather than audible volume). Citizen United would be overturned by referendum. I trust democracy more than most, but still I don't get silly about it.

OTOH, SCOTUS term limits are also a good idea.

RC AKA Darryl, Ron -> RC AKA Darryl, Ron... , March 25, 2017 at 07:38 AM
"...heat count..."

[No, HEAD count. If votes were measured by heat count then Bernie Sanders would be POTUS now.]

Paine -> New Deal democrat... , March 25, 2017 at 07:58 AM
New deal (D)emocrat

Is not a democrat

Or at least it would seem
NdD is no small d democrat

The court system we inherited is like many institutions
Ormed in our ante bellum era
an artifact of slave power

Paine -> Paine... , March 25, 2017 at 08:01 AM
Post bellum
The emerging big corporate power
found this arrangement congenial to its interests

The one challenge time ?


The new deal


The very era our sincere progressive liberal
NdD likes to impersonate at lawn parties

Paine -> Paine... , March 25, 2017 at 08:02 AM
The FED as drafted and redrafted
Is the supreme wanna be
mulp -> New Deal democrat... , March 25, 2017 at 08:18 AM
Yeah, Republicans should have appointed more of the judges.
New Deal democrat -> mulp... , March 25, 2017 at 09:56 AM
Democrats have held power for 10 of the last 18 years which would mean 5 of the current Justices would have been appointed by DSL.

[Insert snide remark about math abilities here.]

New Deal democrat -> New Deal democrat... , March 25, 2017 at 09:59 AM
Further, since 1968 (that's almost a half century ago, Dems have appointed exactly 5 Justices in total.

Under my system they would have appointed 10.

ilsm -> RC AKA Darryl, Ron... , March 25, 2017 at 09:06 AM
cnn resembles deep red tea party fox news.....

and the run of the mill dems should fit their tri-corn hats

RC AKA Darryl, Ron -> ilsm... , March 25, 2017 at 09:37 AM
I will take your word for it. We don't watch either CNN nor Fox News at my house. Mostly we watch local (same news and weather crew here appears on each the WWBT/WRLH local NBC/Fox affiliates) news with some sampling of MSNBC and Sunday morning ABC and CBS shows along with the daily half hour of NBC network following the evening local. Cable news is sort of an oxymoron given the prevailing editorial slants. The now retired local TV news anchor Gene Cox laid the groundwork for the best news team in central VA by setting a high bar at his station. Gene laid it all out southern fried with satirical humor and honesty unusual in TV news.
RC AKA Darryl, Ron -> RC AKA Darryl, Ron... , March 25, 2017 at 09:38 AM
Maybe more sarcasm than satire, but the point is the same - wit and honesty.
JohnH -> Chris G ... , March 25, 2017 at 07:52 AM
Apparently we have two jokes alternating to lead America: the Republican jokes vs. the Democratic jokes.

Democrats are a joke for rallying their elite around a candidate who had huge negatives and for trying to block more popular candidates from running.

Democrats are a joke for having to rig the primaries in favor of a candidate who had already lost in 2008.

Democrats are a joke for refusing to sack a sclerotic, corrupt, and inept congressional leadership that had lost three straight elections.

Democrats are a joke for refusing to seize the issue that had propelled two Democrats into office--it's the economy, stupid!

Democrats are a joke for pigheadedly refusing to do a post mortem of their failure and insisting on blaming Putin instead!

But Democrats are right to expect that, when two jokes vie for power, their turn as joke in power will eventually come.

mulp -> JohnH... , March 25, 2017 at 08:29 AM
Ok, so, who do you want a post mortum to produce as the Democratic Trump?

Who would be the Democratic Freedom caucus obstructing all change unless all private property is confiscated?

You are merely saying Democrats must be more like Republicans. More extreme.

Democrats are centrists and moderates and thus unable to promise silver bullet solutions, free lunches, ...

Democrats just can't lie like Republicans have increasingly done since Reagan promised free lunches and failed to deliver, causing increasing anger among those Reagan betrayed.

JohnH -> mulp... , March 25, 2017 at 09:01 AM
Maybe a post mortem would simply reveal that Democrats should have had a coherent economic message and pursued a strategy of standing up for working America for the past 8 years. For example, having Pelosi demand votes on increasing the minimum wage as often as Ryan demanded votes on killing Obamacare...

Any honest post mortem would have revealed that standing with billionaires and the Wall Street banking cartel--and not prosecuting a single Wall Street banker--is not a winning strategy...

jonny bakho -> JohnH... , March 25, 2017 at 10:53 AM
Do you understand how Congress Works?
Pelosi has not had power to demand any votes since 2010.
As soon as the Dems came to power in 2007, they raised the MinWage and Bush signed.
There were several yearly increases.
You are repeating GOP nonsense
JohnH -> jonny bakho... , March 25, 2017 at 11:26 AM
Do you understand how Congress works? Pelosi could have proposed legislation in 2009-2010 to increase the minimum wage and index it to inflation. With a filibuster proof majority in the Senate it could have passed.

The Senate could have repeatedly proposed increasing the minimum wage any time until 2015...and Democrats could have attempted to attach minimum wage legislation as a budget rider any time they wanted. They didn't.

Chris G -> JohnH... , March 25, 2017 at 12:33 PM
That Pelosi did not resign immediately following the 2016 election or, not having offered her resignation, that Congressional Democrats did not demand it is an indication that the party still has deep-rooted problems. (Pelosi may not be the cause of those problems but given how badly they've fared since 2010 she's clearly not the solution. She has no business remaining as minority leader.) I'm fine with Perez as DNC chair but Ellison should be minority leader.

Lee A. Arnold : , March 25, 2017 at 04:48 AM
"Medicare for all" may be the best battle cry. 65-70% of the U.S. people want a single-payer. Bernie Sanders has effectively destroyed the old Democratic Party and sits in a commanding position as spokesman, he gets 6 TV cameras with an hour's notice and he is probably the most popular politician in the U.S. The Democrats don't have to push it for now, they can wait for news to develop. This is all on the Republicans. Let the managerial disaster of Trump and the utter immorality of the "Freedom Caucus" sink in a little more, this story has "legs" as they say in show biz.
jonny bakho -> Lee A. Arnold ... , March 25, 2017 at 05:04 AM
David Frum, the excommunicated conservative wrote in 2010:
""The real leaders are on TV and radio"

Bernie Sanders is the Dems TV leader.
Simple ideas repeated endlessly, easy to memorize slogans
Knows how to manipulate emotions
In the Twitter Age, this is how all successful politicians must message

Chris G -> jonny bakho... , March 25, 2017 at 06:29 AM
It doesn't hurt that his ideas are good ones;-)

Simple slogans repeated often isn't a new approach to politics. It goes back well over a century. "Keep it simple and take credit." Liberals haven't been very good at that in recent decades. (In contrast, FDR was.) Most people aren't wonks nor do they desire to become one. Messaging which presumes that they are or do is not a recipe for success.

Chris G -> Chris G ... , March 25, 2017 at 06:31 AM
Jack Meserve, Keep It Simple and Take Credit - http://democracyjournal.org/arguments/keep-it-simple-and-take-credit/
jonny bakho -> Lee A. Arnold ... , March 25, 2017 at 05:09 AM
Sanders has not "destroyed" the old Democratic Party.
He is a better TV messenger and ambassador to the public
He plays the Paternalistic Grandfather who does not trigger culture shock among white voters on TV
Lee A. Arnold -> jonny bakho... , March 25, 2017 at 05:59 AM
More like the cranky uncle, whom you had better listen to. Bernie Sanders is currently the most popular politician in the United States, by a long shot:

http://thehill.com/blogs/pundits-blog/the-administration/325647-stunning-polls-show-sanders-soaring-while-trumpcare

Peter K. -> jonny bakho... , March 25, 2017 at 08:24 AM
you minimize how well he did in the primary as do all of you dishonest center-left types
Peter K. -> Peter K.... , March 25, 2017 at 08:31 AM
Sanders won New Hampshire, Colorado, Minnesota, Oklahoma, Vermont, Kansas, Nebraska, Maine, Michigan, Idaho, Utah, Alaska, Hawaii, Washington, Wisconsin, Wyoming, Rhode Island, Indiana, West Virginia, Oregon, Montana, North Dakota.

*and he was close in many states like losing Massachusetts 606k to 589k. And the entire second half of the primary the DNC was repeating how Hillary had won mathematically over and over even though people hadn't voted.

DeDude -> jonny bakho... , March 25, 2017 at 08:38 AM
"Sanders has not "destroyed" the old Democratic Party"

No he is not stupid. What he has done is moving the Overton window - something that was long overdue. There is definitely an opening to make ObamaCare the first step towards MediCare for all (as it always was intended by by all but the bluedogs). But as good as Sanders is at message and getting the crowds going, he is going to need help with the politicking to actually get it done.

ilsm -> Lee A. Arnold ... , March 25, 2017 at 05:35 AM
too hard....

two party system

both obey FIRE

why no indeps

go for 'serious'

dems

Russians

cannot mess

this up

New Deal democrat -> Lee A. Arnold ... , March 25, 2017 at 07:35 AM
One issue going forward is whether the Dems should offer their own plan. I think they should.

As a few others have pointed out, Trump is not wedded to the GOP establishment. If he thinks he can "WIN bigly!" by allying with Dems, he will do so. I happen to think that he is mainly against "Obamacare" because Obama humiliated him at the White House Correspondents' Dinner once upon a time, and he is nothing if not vengeful. He wants to obliterate Obama's legacy.

So Dems need to make a big stink any time Trump administrativley undercuts Obamacare provisions to try to make it fail. But also they should give him the chance to do something he can call Trumpcare that actually works.

Obamacare does have some major problems (the individual mandate is hated, and the penalty isn't big enough. More young people need to buy in. Some of the Exchanges and health care provider networks are too narrow.

In addition to the "public option" and age 55+ Medicare buy-in, one thing that might work is abollishing the mandate and penalty and replaciing them with automatic enrollment. Call it "You're employed, you're covered!"

Just like SS, Medicare, unemployment and disability deductions to paychecks, establish a Health Care automatic deductible. If your employer offers healthcare, the deductible is reduced by the amount of the premium, all the way to zero if applicable.
If your employer doesn't offer healthcare, if you are under age 40, you are automatically enrolled in the least expensive Bronze plan in your state. If you are 40 or older, you are automatically enrolled in the least expensive Silver plan in your state.

The deductible would also include a small contribution towards Medicaid. Then, if you are unemployed, you are automatically enrolled in Medicaid, but can continue with the silver or bronze plan as above if you choose.

Dems could turmpet such a plan to "Reform and Improve" Obamacare, and campaign on pushing for it if they get a Congressional majority. Call it Trumpcare and President Caligula might sign on.

Peter K. -> New Deal democrat... , March 25, 2017 at 08:22 AM
Yes, good succinct comment by Arnold.
DeDude -> New Deal democrat... , March 25, 2017 at 08:52 AM
I agree that there might be an opening for that after the midterms. If Trump pushes on the weak spots of ObamaCare rather than fixing them, he will have backed himself into a corner that only the democrats can help him get out of. Right now democrats just need to do a lot of nice talk about being willing to sit down with the President and negotiate a common sense bipartisan solution.
mulp -> DeDude... , March 25, 2017 at 09:46 AM
No. Republicans must be driven by fear to sit down with Democrats to get their help. Republicans must own whatever they get Democrats to support so Republicans can't turn around and attack the result like they attacked the Republican defined Obamacare.

Medicaid is Republican defined - Medicare for the poor gave too much to the inferior poor and disabled. The old were superior because they are the fit who survived, thus they are rewarded with Medicare.

The Obamacare public option is Medicaid. Government health care for losers. Anyone can qualify by choosing to be losers. Obamacare does have the public option progressives demanded, but it's not the public option for winners.

Paine -> Lee A. Arnold ... , March 25, 2017 at 08:04 AM
Excellent commentary Lee A A
Peter K. -> Lee A. Arnold ... , March 25, 2017 at 08:22 AM
Yes, good succinct comment by Arnold.
mulp -> Lee A. Arnold ... , March 25, 2017 at 09:37 AM
Name the Senators, representatives, and governors Bernie Bros have delivered?

Where are the Bernie Bros Newts, Cruz, Marcos, ...?

I'm in my 70th year. Conservatives attacked liberals in the 60s, my youth, as promising free lunches to gain power. But what they really hated was liberals convinced voters to tax all voters to pay for the things most voters wanted everyone to have, BASED ON SOUND ECONOMICS TO MAXIMIZE EFFICIENCY AND WELFARE.

Friedman led the effort to distort theory to eliminate the broad meaning of general welfare in economics. He did it by eliminating the hard connection between labor cost and gdp. He argued that labor costs and consumption can be cut to increase profits, and that contrary to theory, higher profits is more efficient.

Laffer applied operations theory to taxes, as if government was taxing to maximize profits.

Thus supply side theory of profit maximization.

The result delivered was the imperative to cut taxes. To cut labor costs.

Thus they argued that every economic measure improves if taxes and wages are cut.

Reaganomics would deliver more stuff at lower cost, higher profut, and that makes everyone better off, especially those in poverty.

Friedman saw consumption as a bad thing. He wanted higher gdp, less consumption.

In other words, he rewrote Adam Smith attack on mercantile economics into a justification of returning to mercantile economic policy.

So, who do Bernie Bros offer as the Milton Friedman and Laffer to create an intellectual foundation to refute Adam Smith, FDR, Keynes, Galbraith, are return to hunter gatherer economics? Who is the economist who can convince us that Marxist economic theory will work, as long as it's not captured by right wing capitalists like Fidel Castro, Chavez, Stalin, Lenin, the founders of Israel, ....

Bernie certainly must be influenced by the same economic theory that created Israel. It grew from the same Marxist roots in Germany that powered Stalin and Lenin. Bernie is a pre-WWII Zionist as best I can tell.

Why wouldn't Bernie deliver Israel governance to the US? How would he prevent the greedy from joining the Movement?

And Israel has the social welfare state system Bernie wants. Hundreds of thousands of men do not work so they can study supported by welfare. Universal health care. Women are very equal in status.

I grew up heating the Zionist Dream, theory, much like Bernie did, but from conservative Indiana. Seemed very idealist virtue becoming reality in the 50s and 60s.

I have often used Israel as the example of a good universal health care system, of education, of welfare.

Never heard Bernie say, "I want the US to be like Israel." Why not? Why Sweden?

jonny bakho : , March 25, 2017 at 04:54 AM
Frank is wrong. What the GOP establishment dislikes most about Obamacare is the taxes on the wealthy. Medicare for all would have to be paid for by taxes on the wealthy or substantial payroll tax increases on the working class.
This does not meet GOP or Trump objectives for tax cuts on the wealthy.
The TV and radio talk uses Obamacare bashing to sell ads. They can easily change the subject to some other click bait.
Medicare for all? NaGonnaHappN
RC AKA Darryl, Ron -> jonny bakho... , March 25, 2017 at 05:14 AM
Frank was not suggesting that the GOP establishment would support Medicare for all. Frank was suggesting that Trump would essentially change parties to become a Democrat. As dubious as that notion is, more importantly it is premature. If Democrats win back both chambers of Congress, then it would at least be mechanically possible if still extraordinarily dubious. Mostly though Frank was just reaching for something worth saying. Now is a tuff time for commentary on the political economy.
jonny bakho -> RC AKA Darryl, Ron... , March 25, 2017 at 05:47 AM
Trump is not going to raise the taxes required to fund Medicare For All.
Frank is delusional
Lee A. Arnold -> jonny bakho... , March 25, 2017 at 06:10 AM
Jonny Bakho: "Medicare for all would have to be paid for by taxes"

Theoretically you don't have to raises taxes if you get private insurers out of the game. They are a big expense, and give no value-added.

Doesn't mean that is politically possible, with Trump and a GOP Congress. But Trump and a Democratic Congress? I couldn't predict. Keep in mind that this man is almost an ideological vacuum, no managerial skills, has no constant concerns for anything except keeping himself in the spotlights, to be loved. And he just learned that the Freedom Caucus is implacably nuts.

New Deal democrat -> Lee A. Arnold ... , March 25, 2017 at 07:21 AM
"the Freedom Caucus is impacably nuts."

Thank the Great Flying Spaghetti Monster for that!!!!

Everytime the centrist dems - or mainly GOPers - try to sell out social insurance programs, the Freedom Caucus stands in their way. As a progressive, I am deeply and profoundly grateful!

/ snark

New Deal democrat -> New Deal democrat... , March 25, 2017 at 07:22 AM
"every time" and "main line"

G*d I hate autocorrect.

ilsm -> New Deal democrat... , March 25, 2017 at 09:10 AM
socialists should all be glad

trump is running the wreckage

more 'social progress' for big FIRE

RC AKA Darryl, Ron -> Lee A. Arnold ... , March 25, 2017 at 07:30 AM
"They are a big expense, and give no value-added."

[Someone has to do claims processing. The resistance against growing the federal payroll is an unnecessary hurdle for Medicare for all (MFA) to jump. Better administer it more like Medicaid. Let insurance companies handle the operations for a fee. Federal claim payments are handled on a pass thru. Then let the operational administration default to the MFA supplemental plan carrier if the insured has one, else the lowest cost carrier in the insured's state. For MFA clients then there could be a single claims process for providers even for patients with both MFA and MFA supplemental policies. That lowers the hurdle for MFA to leap over the insurance company lobby as well.]

RC AKA Darryl, Ron -> RC AKA Darryl, Ron... , March 25, 2017 at 07:31 AM
Hell, that would even lower the provider and patient hurdles.
Lee A. Arnold -> RC AKA Darryl, Ron... , March 25, 2017 at 10:08 AM
Claims processing by humans is going to become a thing of the past.
RC AKA Darryl, Ron -> Lee A. Arnold ... , March 25, 2017 at 11:29 AM
Most of health insurance claims processing has been automated for a long time. Still it takes a lot of worker-hours to reconcile the errors.

Imagine how many worker hours it will take to reconcile liabilities for the first multi-car multi-fatality pile up of robot cars on the LA freeway. It will not matter that in total there have been less collisions and less fatalities when the big one hits. Computers are incapable of intuitive judgement which leads to blunders of potentially a colossal scale occurring that could have easily been foreseen by a human. To err is human but it takes a computer to really screw things up beyond all recognition. It is just a matter of time and time is always on Murphy's (that which can go wrong will go wrong) side. I know that myths about computers that never make mistakes and never need to be programmed again abound and I am sure that they will still be with us 20,000 years from now, when we are not even in any memory banks. I spent my entire career about to be replaced by software, but I was finally laid off because of administrative concerns with regards to legacy managed employees in context of the re-compete of the NG/VITA outsourcing contract (which is far less catchy). Computers have the potential to speed transit and reduce fatalities, but that potential will not be permanently realized as long as people are intent upon removing all human control and intervention. Computers can be capable copilots under almost all circumstances, but their owners cannot weather the fallout from their inability to conceive a response on their own when confronted with conditions that they were not programmed for. Such dramatic consequences will eventually raise a great furor, horror, deep sorrow, and extensive liability concerns. Even if you could sue a computer it is unlikely that they could demonstrate the means to pay. Incarceration of a computer for criminal negligence seems a bit ludicrous as well. The owner of the offending property better have their insurance premiums all paid up, but what then? Who will insure the next owner? Advocates of computer driven cars are planning on no fault insurance being mandated in each and every state. Good luck with that.

My wife works for Anthem although not in claims processing. She used to work in membership which is also automated. Software developers for health insurance mostly use Agile methods. One facet of that is that they only expect automation to handle roughly 90% (ideally more) of the workload because they have learned that there will never be a no defects computer system and they are saving expensive labor time in development by allowing lower paid workers to pick up a lot of the more complicated cases manually. That reduces time spent in the iterative process of testing and correcting defects. I am sure that you remember the problems with the ACA's automated insurance membership market. Stuff happens all the time in IT.

It is not that I had to work in IT for 47 years to understand the limitations. Merely my childhood education on the mathematical system of logic that underlies their circuitry and programming would have been sufficient, but a bit of empirical confirmation never hurts. Understanding reality is unfortunately a pre-requisite, but once that is accomplished then there are great opportunities to achieve improved results. Computers are not the problem, but can often be an essential part of the solution rather than a faceless soulless panacea. Does not compute can happen anywhere, but worse though when it happens at 75 MPH.

mulp -> Lee A. Arnold ... , March 25, 2017 at 09:57 AM
So, your answer is higher unemployment?

"They are a big expense, and give no value-added."

You clearly buy in too free lunch economics!

Cut costs (of paying workers) to give everyone more stuff and create more higher paying jobs!!!

By the way, Medicare employs as many people as insurers to administer the benefits and provider payments. After all, it's all outsourced to insurers who already do that work for employers.

Do not assume that the 10% of insured individuals and small groups with high sales and marketing cost represent the costs of the 80% with very low sales and marketing costs, handled by insurer backroom operations.

Your argument is like saying that nationalizing Apple would cut food costs by 50% because Apple sales, marketing, profits are 50% of Apple revenue and thus 50% of everything is sales, marketing, profit.

Lee A. Arnold -> mulp... , March 25, 2017 at 11:27 AM
Every serious study that looks at current costs in the multipayer healthcare insurance concludes that moving to single-payer will save 15-20% of total spending. Here is yet another one:
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4283267/
RC AKA Darryl, Ron -> Lee A. Arnold ... , March 25, 2017 at 11:40 AM
There is nothing about that paper that would not hold true or even truer of a two tiered system of Medicare for all with administrative processing collocated with the supplemental insurer whenever there is one. Just do a work flow model and note how many steps are cut out at each the provider and insurer if primary and secondary coverage administrative processing for membership, claims, and policy holder services are collocated.
Chris G -> jonny bakho... , March 25, 2017 at 06:46 AM
Ah, but Trump is both delusional and vengeful. He might wake up one morning and decide that Republicans are enemies to be destroyed. He has no interest in let alone understanding of policy. He could take a position just out of spite. And if he thought it would make people who weren't his enemies love him then who knows. (Odds of him being struck by lightning are probably comparable - low but not zero.)
RGC -> jonny bakho... , March 25, 2017 at 06:50 AM
Government Funds 60% of U.S. Healthcare Costs - Far Higher than Previously Believed

"We Pay for National Health Insurance but Don't Get It"

"Universal coverage is affordable - without a big tax increase," continued Dr. Himmelstein. "Because taxes already fund 60% of health care costs, a shift about the size of the recent tax cut ($130 billion a year) from private funding to public funding would allow us to cover all the uninsured and improve benefits for everyone else. Insurers/HMOs and drug companies buy-off our politicians with huge campaign contributions and hordes of lobbyists."


http://www.pnhp.org/news/2002/july/government_funds_60.php

Chris G -> RGC... , March 25, 2017 at 07:20 AM
Reference is from 2002. Current numbers?
RGC -> Chris G ... , March 25, 2017 at 08:04 AM
Beyond the Affordable Care Act: A Physicians' Proposal for Single-Payer Health Care Reform

During a transition period, all public funds currently spent on health care – including Medicare, Medicaid, and state and local health care programs – would be redirected to the unified NHP budget. Such public spending – together with tax subsidies for employer-paid insurance and government expenditures for public workers' health benefits – already accounts for 60% of total U.S. health expenditures.28 Additional funds would be raised through taxes, though importantly these would be fully offset by a decrease in out-of-pocket spending and premiums.

http://www.pnhp.org/nhi

RGC -> RGC... , March 25, 2017 at 07:36 AM
Many employers now pay for employees' health insurance and that employee compensation is tax-exempt.

If employers health insurance comp were replaced by medicare for all, employers could replace it with wages.

Employees could get health insurance from medicare instead of from private plans. Thus instead of private health insurance paid by employers (and partially by the government via tax exemptions), medicare could pay it from the taxes the government didn't use to collect.

RGC -> RGC... , March 25, 2017 at 10:13 AM
Which would you rather do - pay taxes for Medicare or pay a larger amount than the taxes to private insurers?
ilsm -> RGC... , March 25, 2017 at 09:12 AM
when a "kid" of 50 needs

quad bi-pass they must

thank medicare those

cardio ICU's would be

gone without the

75 years olds' "demand"

as if FIRE would finance

$2M units

that don't

have positive ROI

RGC -> RC AKA Darryl, Ron... , March 25, 2017 at 07:08 AM
Is Donald Trump still 'for single-payer' health care?


"Perry said Trump is "for single-payer health care."


Fifteen years ago, Trump was decidedly for a universal healthcare system that resembled Canada's system, in which the government pays for care for all citizens.

Recently, he's said he admires Scotland's single-payer system and disses the Affordable Care Act as incompetently implemented.

However, a Trump spokesman denied that the candidate supported "socialized medicine" and suggested Trump prefers a "free-market" solution. Other than that, though, the Trump campaign has been silent about what his specific health care policies are; perhaps Trump will be pressed on this point during the Aug. 6 debate.

Given the current evidence, Perry's attack is partially accurate, but leaves out details. We rate the statement Half True.

http://www.politifact.com/truth-o-meter/statements/2015/aug/02/rick-perry/donald-trump-still-single-payer-health-care/

RC AKA Darryl, Ron -> RGC... , March 25, 2017 at 07:40 AM
Trump will need to leave the Republican Party to get that done and first he will need the Republican Party majority to leave Congress.
RGC -> RC AKA Darryl, Ron... , March 25, 2017 at 07:51 AM
You mean like in 2018?
ilsm -> RGC... , March 25, 2017 at 09:15 AM
Trump single payer

need the dems off

wall st as well

what Trump said

US not ready

bi partisan thugs

must plunder more

to make US

ready

RC AKA Darryl, Ron -> RGC... , March 25, 2017 at 09:40 AM
Well, 2018 would be about time for it, but the Democratic Party has proven an unreliable source before.
DeDude -> RC AKA Darryl, Ron... , March 25, 2017 at 09:05 AM
Trump is actually apolitical - the only reason he right now is Trumpeting hard right wing and neocon ideas is that he is being feed them, and he got snookered into thinking they would work for him. When he realize that crap is pulling his reputation and popularity down the drain, he will be ready for someone to offer him a lifeline.
RC AKA Darryl, Ron -> DeDude... , March 25, 2017 at 09:42 AM
Well, that would certainly be my hope. There is evidence that he has been all over the map politically which confirms what you say.
ilsm -> jonny bakho... , March 25, 2017 at 05:36 AM
gop and dem

establish

the same

Peter K. -> ilsm... , March 25, 2017 at 08:20 AM
New Deal democrat -> Lee A. Arnold...

"the Freedom Caucus is impacably nuts."

Thank the Great Flying Spaghetti Monster for that!!!!

Everytime the centrist dems - or mainly GOPers - try to sell out social insurance programs, the Freedom Caucus stands in their way. As a progressive, I am deeply and profoundly grateful!

/ snark

Reply Saturday, March 25, 2017 at 07:21 AM

My thoughts exactly. EMichael and PGL said it was the Wall Street Democrats we had to worry about? What?

Tax reform will also crash and burn now. PGL has been all worried whining for months without telling his readers that there is a large business and conservative opposition to Paul Ryan's reform.

ilsm -> Peter K.... , March 25, 2017 at 09:17 AM
the DLC/Clinton cabal

implacably corrupt!

RC AKA Darryl, Ron -> ilsm... , March 25, 2017 at 09:45 AM
The nature of dollar duopoly is implacably corrupt. Until we change that system then we will have to make do with what we got. It has largely been that way since the ink dried on the US Constitution.
Gerald : , March 25, 2017 at 05:30 AM
"The president...may consider changing course and working across party lines to develop support for universal access to Medicare." Would that this were possible; Trump doesn't care nearly enough about the millions who would benefit to make the slightest move in this direction.
ilsm -> Gerald ... , March 25, 2017 at 05:38 AM
aside from

early tax returns

trump has

early view

of EU style

health system

look it up

Fred C. Dobbs -> ilsm... , March 25, 2017 at 07:26 AM
So, most here will agree,
let it be Bernie, going forward?

I could accept & work with that.

ilsm -> Fred C. Dobbs... , March 25, 2017 at 09:18 AM
yup!
DeDude -> Gerald ... , March 25, 2017 at 09:10 AM
The thing he cares about is his approval ratings and popularity. He will soon enough recognize that supporting issues that has support from 2/3 or more of the population is the way to improve his popularity. If the democrats play it right they can get a lot of their own priorities through with his help. Remember how Bush II got a $ trillion MediCare prescription drug benefit through a conservative congress (and it is funded through the regular progressive tax system). That was a democratic policy that could not have been passed by a democratic President.
marcus nunes : , March 25, 2017 at 06:09 AM
"The EU will celebrate on March 25th the 60th anniversary of its founding (Treaty of Rome, 1957), while its future is in doubt. What went wrong?"
https://thefaintofheart.wordpress.com/2012/05/27/meade-swann-and-how-two-simple-lines-perfectly-illustrate-the-eurozone-conundrum/
point : , March 25, 2017 at 06:43 AM
https://growthecon.com/blog/Profit-Accounting/

"If your house is worth 500,000, a 3% return would mean charging 15,000 in rent per year, or 1,250 per month. Now, if you look out at the market and find out that you could actually rent your house out for 2,000 per month, you are making 750 in economic profit. The price you can charge for your house, 2,000, is higher than the marginal cost to you, 1,250. Profits!"

The idea that the difference in market value and PV rents represents economic profits does not sit well with me, but I can't exactly explain why. It seems more like speculative profit. And the idea that the difference should systematically persist, as seems to be the case in the discussion, also does not sit well. The discussion implies, after all, that rents, representing non-production, are becoming increasingly large in aggregate. I know that we subsidize the pyramid accumulation of rent streams, for no good reason in my opinion, but if this is true it seems to say there is another kind of hollowing out underway where rents displace real return on investment. All this in the context where renters, in general, cannot fund the sum of housing, education, medical care and retirement

DeDude -> point... , March 25, 2017 at 09:18 AM
That calculation doesn't take into account the depreciation of the property or the taxes and maintenance. A lot of people who buy houses to rent them out use the rule of 100. If you want to make good money on a rental property you have to be able to get a rent of no less than 1% of your purchase price. So a $100K property should rent out for $1000 per month.
point -> DeDude... , March 25, 2017 at 10:30 AM
So the guy's 3% may be in error.
DeDude -> point... , March 25, 2017 at 11:07 AM
Yes big time. He is considering the house an investment asset with no cost (like a bond or stock). However, houses have all kinds of cost and they also lose value for every year they get older. An investment return of 3% is only "reasonable" for basically risk free investments (government or government guaranteed bonds) that have absolutely no cost associated with owning them.
Fred C. Dobbs : , March 25, 2017 at 07:35 AM
In a Call to The Times, Trump Blames Democrats for the
Failure of the Health Bill https://nyti.ms/2nNPHD9
NYT - MAGGIE HABERMAN - MARCH 24, 2017

WASHINGTON - Just moments after the Republican plan to repeal and replace the Affordable Care Act was declared dead, President Trump sought to paint the defeat of his first legislative effort as an early-term blip.

The House speaker, Paul D. Ryan, was preparing to tell the public that the health care bill was being withdrawn - a byproduct, Mr. Trump said, of Democratic partisanship. The president predicted that Democrats would return to him to make a deal in roughly a year.

"Look, we got no Democratic votes. We got none, zero," Mr. Trump said in a telephone interview he initiated with The New York Times.

"The good news is they now own health care. They now own Obamacare."

Mr. Trump insisted that the Affordable Care Act would collapse in the next year, which would then force Democrats to come to the bargaining table for a new bill.

"The best thing that can happen is that we let the Democrats, that we let Obamacare continue, they'll have increases from 50 to 100 percent," he said. "And when it explodes, they'll come to me to make a deal. And I'm open to that."

Although enrollment in the Affordable Care Act declined slightly in the past year, there is no sign that it is collapsing. Its expansion of Medicaid continues to grow.

In a later phone interview with The Times, the Senate minority leader, Chuck Schumer, ridiculed Mr. Trump's remarks about Democrats being at fault.

"Whenever the president gets in trouble, he points fingers of blame," Mr. Schumer said. "It's about time he stopped doing that and started to lead. The Republicans were totally committed to repeal from the get-go, never talked to us once. But now that they realize that repeal can't work, if they back off repeal, of course we'll work with them to make it even better."

Mr. Trump said that "when they come to make a deal," he would be open and receptive. He singled out the Tuesday Group moderates for praise, calling them "terrific," an implicit jab at the House Freedom Caucus, which his aides had expressed frustration with during negotiations. ...

Fred C. Dobbs -> Fred C. Dobbs... , March 25, 2017 at 07:41 AM
Failure of health care bill is a huge setback for Trump
http://www.bostonglobe.com/news/politics/2017/03/24/trump-massive-loss-endangers-his-young-presidency/Czat7MDmwHa7us43qJeEbM/story.html?event=event25
via @BostonGlobe - Annie Linskey - March 25, 2017

WASHINGTON - Donald Trump famously said that if he became president he would win so much, Americans would get tired of winning. But so far he's mostly losing, bigly.

Even with a wide Republican majority in the House, the president failed to deliver on the centerpiece of his legislative agenda - repealing the Affordable Care Act - raising loud questions about the effectiveness of his young presidency and whether Republicans are capable of making the transition from an opposition party to one that governs.

"It's a catastrophic legislative failure," said Rick Tyler, a Republican strategist who didn't support Trump during the election. "It's the equivalent of having a cardiac arrest. You can recover from it, but it will take a lot of rehab."

He added: "Political experience is a hard teacher. You get the test first and learn the lesson next."

Even former House speaker Newt Gingrich, a close Trump ally, delivered a harsh verdict Friday. "Why would you schedule a vote on a bill that is at 17 percent approval?" he asked on his Twitter feed, referring to a Quinnipiac University poll.

The tweet went viral, and in an interview Gingrich added: "When I saw the numbers - that is everything I have opposed in my entire career. That's how the Republicans lost the majority."

Still, the defeat of Trump's first request of Congress represents a further deterioration of his already shaky credibility in Washington and among the American people.

He has cast himself as a master salesman and the "closer" who can win over allies in the most difficult of circumstances through some combination of his winning personality and take-no-prisoners approach to negotiations.

But that picture of Trump is becoming about as questionable as his unsubstantiated claims that he had huge crowd sizes at his inauguration, his unproven accusations that bus loads of Massachusetts voters cast illegal ballots in New Hampshire, and his much rejected insistence that then-President Obama put a wiretap on his phone.

The pattern, in the eyes of his harshest critics, is that there's little evidence to back up his boasts.

He could not close this deal. Republican members of the House of Representatives, who have voted to repeal the Obama health law more than 50 times in the past seven years, refused Trump's entreaties to support the Republican replacement for the law.

The setback comes as other storm clouds are gathering over the Trump presidency. There's the FBI investigation into whether his campaign staff coordinated e-mail leaks designed to influence the election, along with the Russians.

FBI director James Comey was spotted going in and out of the West Wing on Friday, which was a reminder of the investigation, even if the White House claimed Comey was there for a routine meeting. ...

Tom aka Rusty -> Fred C. Dobbs... , March 25, 2017 at 07:47 AM
This was bound to happen.
Fred C. Dobbs -> Tom aka Rusty ... , March 25, 2017 at 08:08 AM
Hillary Clinton ✔ ‎@HillaryClinton

Today was a victory for all Americans.

5:21 PM - 24 Mar 2017

(statement at https://twitter.com/HillaryClinton/status/845385004389666816 )

Fred C. Dobbs -> Tom aka Rusty ... , March 25, 2017 at 08:19 AM
Elizabeth Warren ✔ ‎@SenWarren

But I'm not doing a touchdown dance today. Not
when the GOP is still hell-bent on rigging the
system for the rich & powerful.

5:56 PM - 24 Mar 2017

https://twitter.com/SenWarren/status/845393852219478022

ilsm -> Fred C. Dobbs... , March 25, 2017 at 09:24 AM
Comey going in

to talk jail

not gop targets

story is not only

uncovering DLC corruption

it is leaking

surveillance of Russian

diplomats' conversation with

US citizens that have no

intelligence to leak

'colluding' to put the truth

out is only crime

to DLC Leninists

Obama Leninism

crushing the

Bill of Rights

is the story

Fred C. Dobbs -> Fred C. Dobbs... , March 25, 2017 at 08:02 AM
On health-care, as on so much else,
President Trump passes the buck, reports
https://www.theatlantic.com/politics/archive/2017/03/the-buck-doesnt-stop-here-anymore/520839/
The Atlantic - David A. Graham - March 24, 2017

Speaking in the Oval Office Friday afternoon, President Trump surveyed the wreckage of the Obamacare repeal effort and issued a crisp, definitive verdict: I didn't do it.

The president said he didn't blame Speaker Paul Ryan, though he had plenty of implied criticism for the speaker. "I like Speaker Ryan. He worked very hard," Trump said, but he added: "I'm not going to speak badly about anybody within the Republican Party. Certainly there's a big history. I really think Paul worked hard." He added ruefully that the GOP could have taken up tax-reform first, instead of Obamacare-the reverse of Ryan's desired sequence. "Now we're going to go for tax reform, which I've always liked," he said.

As for the House Freedom Caucus, the bloc of conservatives from which many of the apparent "no" votes on the Republican plan were to come, Trump said, "I'm not betrayed. They're friends of mine. I'm disappointed because we could've had it. So I'm disappointed. I'm a little surprised, I could tell you."

The greatest blame for the bill's failure fell on Democrats, Trump said.

"This really would've worked out better if we could've had Democrat support. Remember we had no Democrat support," Trump said. Later, he added, "But when you get no votes from the other side, meaning the Democrats, it's really a difficult situation."

He said Democrats should come up with their own bill. "I think the losers are Nancy Pelosi and Chuck Schumer, because they own Obamacare," he said, referring to the House and Senate Democratic leaders. "They 100 percent own it."

Trump was very clear about who was not to blame: himself. "I worked as a team player," the president of the United States said, demoting himself to bit-player status. He wanted to do tax reform first, after all, and it was still early. "I've been in office, what, 64 days? I've never said repeal and replace Obamacare within 64 days. I have a long time. I want to have a great health-care bill and plan and we will."

Strictly speaking, it is true that Trump didn't promise to repeal Obamacare on day 64 of his administration. What he told voters, over and over during the campaign, was that he'd do it immediately. On some occasions he or top allies even promised to do it on day 1. Now he and his allies are planning to drop the bill for the foreseeable future.

It is surely not wrong that there is lots of blame to go around. Congressional Republicans had years to devise a plan, and couldn't come up with one that would win a majority in the House, despite a 44-seat advantage. The House bill was an unpopular one, disliked by conservatives and moderates in that chamber; almost certainly dead on arrival in the Senate; and deeply unpopular with voters. Even before the vote was canceled, unnamed White House officials were telling reporters that the plan was to pin the blame on Ryan. ...

The Republicans fold and
withdraw their health-care bill https://www.theatlantic.com/politics/archive/2017/03/trump-republicans-failure-obamacare/520788/
The Atlantic - Russell Berman - March 24, 2017

... Defeat on the floor dealt Trump a major blow early in his presidency, but its implications were far more serious for the Republican Party as a whole. Handed unified control of the federal government for only the third time since World War II, the modern GOP was unable to overcome its internecine fights to enact a key part of its policy agenda. The president now wants to move on to a comprehensive overhaul of the tax code, but insiders on Capitol Hill have long believed that project will be an even heavier lift than health care.

As the prospect of a loss became more real on Friday, the frustrations of GOP lawmakers loyal to the leadership began to boil over. "I've been in this job eight years, and I'm wracking my brain to think of one thing our party has done that's been something positive, that's been something other than stopping something else from happening," Representative Tom Rooney of Florida said in an interview. "We need to start having victories as a party. And if we can't, then it's hard to justify why we should be back here."

Nothing has exemplified the party's governing challenge quite like health care. For years, Republican leaders resisted pressure from Democrats and rank-and-file lawmakers to coalesce around a detailed legislative alternative to Obamacare. That failure didn't prevent them from attaining power, but it forced them to start nearly from scratch after Trump's surprising victory in November. At Ryan's urging, the party had compiled a plan as part of the speaker's "A Better Way" campaign agenda. Translating that into legislation, however, proved a much stiffer challenge; committee leaders needed to navigate a razor's edge to satisfy conservatives demanding a full repeal of Obamacare and satisfy moderates who preferred to keep in place its more popular consumer protections and Medicaid expansion. They were further limited by the procedural rules of the Senate, which circumscribed how far Republicans could go while still avoiding a Democratic filibuster. ...

Fred C. Dobbs -> Fred C. Dobbs... , March 25, 2017 at 08:27 AM
It would appear that the 'Freedom Caucus', of
about 30 GOPsters in the House, was barely
enough to stop the AHCA because it 'wasn't
conservative enough', but the moderate
Tuesday Group of about 50 surely was,
because it was too 'conservative'.
ilsm -> Fred C. Dobbs... , March 25, 2017 at 09:28 AM
even with super majority

Obama got a severely flawed

pro FIRE ACA

not Affordable

only replace is

medicare for all

mulp -> ilsm... , March 25, 2017 at 10:16 AM
But you need better free lunch economics to beat the free lunch economics of conservatives, Republicans, Tea Party, Freedom caucus, and Trump.

You need free lunch economics that work and deliver something for nothing. The failure Friday was free lunch economics hitting reality. Getting government and insurance companies out of the lives of Trump and Republican voters did not make these voters richer, healthier, and freer.

Bernie has his own free lunch economics which will likewise turn out to be ashes in the mouths of voters who might get him into the White House, he wants to cut spending based on "not paying workers will not make those workers worse off". Exactly the same theory Reagan to Trump use. Gutting costly regulations that require paying workers to comply will not result in workers being worse off. Or property owners.

Bernie campaigned on eliminating fossil fuels in a way that