Category Archives: Politics

Toxic Assets Take a Back Seat to Health Care Reform

WASHINGTON - MARCH 31:  (L-R) TARP Special Ins...
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Elizabeth Warren made an appearance on  Morning Joe this morning and woke me up at 5 AM PDT with the force of a revelation: those toxic assets are still on the books of the banks.  The banks, which have taken so much of our children’s futures in the form of TARP money and similar bailouts, have won — not by asking for money, taking it, and using it to fix things, but by taking money and doing nothing.

Remember the good old days, before we got sidetracked by euthanasia, pulling the plug on granny, and letting illegal immigrations hijack our health benefits and take them back to their home countries? (Yes, I heard that all being discussed in the Town Halls I watched yesterday.) Well, we were talking about boring stuff like mark-to-market, an obscure little accounting rule that says you have to call your pig a pig when you take it to market and you can’t call it a Ferrari.

The banks are still accounting for their piles of pigs (or maybe pig droppings) as Ferraris, because Congress now allows them to do so. And they will not sell those assets, even to the government, because to do so would mean they’d have to acknowledge them on the books as pigs, throw away those glamorous photos of  Ferraris that adorn their annual reports, and quietly slink away with their pig tails between their legs, giving the field over to newer, smarter banks.

I was with the conservatives on this issue.  I didn’t want us to bail out the banks. But we did, because we thought the system would collapse if we didn’t. OK. So we put off the collapse for two years, but–my fellow Americans — while you are all worrying about death panels and tax-supported abortions, don’t take your eye off the world around you. Multi-task if you can.

Because 30% of the homeowners in the country are now under water.  Job losses, while not accelerating at such a rapid rate, are still happening, and more and more people can’t pay their mortgages.  The gigantic economic re-set is not over, as the next wave of adjustable mortgages come due in 2010.

This means more foreclosures, along with the imminent collapse of the commercial real estate market as well.  Who needs office space when you are laying off workers and can’t get a credit line to keep your business alive?

What will happen? Bank failures at long last. I’ve got my bets on who goes down first as Congress, now threatened by its constituents with full scale revolt, fiddles with health care while the financial underpinnings burn. One set of lobbyists has replaced another.

At least when we spend money overhauling the health care system the money will reach individuals. Following Elizabeth Warren on Morning Joe was Joe Califano, who was around when Medicare was passed. What he said? No one could have predicted forty years ago the revolution in medicine that led to the explosion in life expectancy. We can’t predict what will happen when the next wave of innovation in neurology and cancer research make life even longer. So the only way to control costs is to keep people out of the sick care system.

So let’s put our eye back on the ball. Focus on ourselves. Let the banks fail, but the people succeed. Survive the re-set in the economy, which is believe is permanent, by getting in shape. I will see you at the gym.

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Are There Economies of Scale in Medicine?

I’ve been listening avidly to all the different points of view about health care reform, and the only conclusion I’ve come to is that almost anything is better than what we have.

On Bloomberg the other day, I heard a call for a systemic approach to the practice of medicine from Dr. Eliot Fisher, Director of the Center for Health Policy at Dartmouth. He said there are always better outcomes where groups of doctors collaborate and practice together, as in the Mayo Clinic, the Cleveland Clinic, or even less renowned group practices such as in Grand Junction, Colo. The efficiencies come when a group of physicians are all responsible for a patient’s continuity of care, and when they share information such as that possible with electronic health records (EHRs).

Dartmouth has studies that show these kinds of group practices cut costs, and yet we have relatively few of them in the US. Most physicians still practice in groups of four or less, usually four of the same specialty. And fewer than 20% of these small practices have EHRs. In fact, in Arizona, where EHR adoption took off after Gov. Janet Napolitano mandated it, another article just said doctors who had bone to EHRs were abandoning them because they were costly to support and impossible to learn. Your basic family practice guy or pediatrician, practicing what the docs call “Hamster Medicine,” where he/she has to see 60 patients a day for five minutes each just to support his office, does not have the time or money to shut the office down to train people on an EHR.

So I dread what will happen when these small practices are forced to implement a complex EHR like GE Centricity, which is both the market leader and the product with the worst user interface. GE has already started a lobbying campaign on behalf of its product, part of which consists of interest-free loans to physicians to install it.

The learning curve for Centricity is steep, especially for the bi-lingual staff of many medical offices, where wages are low and turnover is rampant. I have a physician friend who wrote an EHR himself, and then left that product with his old practice (where they love it) to move to another state. There, he found a group that had chosen Centricity not just for the single group, but for the entire region — and nobody could use it! They had abandoned entire parts of it because no one knew how it worked.

That’s shameful. That won’t lower costs. Lower costs will only come from software that works like or Yahoo — interfaces that make it simple for users to pile in mountains of data without even realizing they’re doing it. And to keep the costs down and the learning curve short, the data should be kept in the cloud.

This is, of course, horrifying to the privacy advocates, who have never run a medical office. Well I have, and I can tell you that when the doctor’s fax machine is overflowing with test results, they spill out on to the office floor or sit there in a pile, and anyone walking by can see them, until some harried front office person collects them and (perhaps) misfiles them in the wrong patient folder.

How do I know this? Because not only have I run a medical office, but I helped a group practice install an EHR, and one of their “pain”points and biggest reasons for going electronic was the loss of patient records due to misfiling or non-filing.

What other business runs as inefficiently as a medical office? None. What other business is more dependent on paper? None.

What other business could become 1/16 of the American economy without being forced into business process automation? None.

But forcing EHRs down the throats of sole practitioners isn’t the answer to reigning in costs. Collaboration is. Collaboration is also the answer to many medical errors and misdiagnoses. I’m not saying that we should “crowdsource” the practice of medicine–although that’s happening through various online Health 2.0 sites that consumers rely on when they have insufficient access to care — but I am saying it might be time to streamline these small practices, put them in groups, and allow them to talk to each other over lunch about the same patient. That way I wouldn’t have to tell my internist what my cardiologist said, or wait for the cardiologist to fax over my results to him.

Any kind of information exchange would help. And whose ox does this gore, unless it’s the commercial real estate companies who have been building small medical offices?

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Ten Things You Need to Know About Banks and Credit Card Companies

Credit cards have developed into very complicated financial products. As a result, even if they printed the disclosure in 18 point type, you wouldn’t know what was going to hit you from behind. I have been trying to get out of debt recently, so I’ve been studying the issue. I am now doubling my dose of blood pressure medication and tranquilizers, and practicing yoga so often that I can no longer be gainfully employed. You will need to know what I’ve found out about banks and credit card companies, especially if you are not making them the focus of your life.

1. You cannot close a credit card account. I paid off a balance to Citibank because they had raised my interest from 0%, which I had signed up for, to 29.9% because my payment was one day late due to Wells Fargo’s automated bill pay and the US mail. I asked to close the account. I got the following:

Dear FrancineHardaway: We recently received a request to close your Citi Platinum Select Mastercard account. For your protection, your account has been permanently closed. The closed account cannot be reopened. Please destroy all cards with this account number by cutting the cards in half. A new account number has been assigned to you, and a replacement card will be mailed to you the next business day.

Never mind that I didn’t ask for a replacement card.

2. The card companies don’t want you to pay off the principal. There’s something called a “sweat box” business model for credit cards now. The companies don’t want the principal back. They want the fees. They want to keep the consumer paying.

3. Reforms won’t work because the credit card companies will find a way around them. Every previous effort at reform has just unleashed further ingenuity.

4. Card issuers can make a profit because the interest rates and fees will be so high that they will offset loss of the principal. This is predatory lending: lending with conscious disregard for the consumer’s ability to pay.

5. If you pay too much, they get nervous. In the same mail, I got this notice:

We want to be your number one credit card. We noticed that you recently made a large payment to your Starbucks Card Duetto Visa account and want to make sure we’re not losing your business. That’s why we want to remind you again of these low-rate reasons to stay –it’s our way of showing you that your business is important to us. Enjoy APR’s as low as 0% with check numbers 2993 and 2994. 2.99% APR for 24 billing cycles with check numbers 2995, 2996, 2997. (BTW, there’s a 3% transaction fee to do any of this, and a billing cycle may no longer be a month.)

6.The interest rate on the card does not tell you what the total cost of revolving a balance on a card will be. There are late fees, over-limit fees, annual fees, foreign transaction fees, interchange fees that are charged to the merchant and passed through to the consumer.

7. Convenience checks are subject to the cash advance fee.

8. The new thing is double cycle billing: The balance on which interest accrues is not the balance on this billing cycle, but on this one and the previous one. And if you are late on another card, or perhaps your cable bill, your credit card interest rate will go up. And perhaps your car insurance.

9. There are tricks about when a payment is posted. After 2 PM might count as the next day, and you may pay interest.

10. And then, all this can influence your mortgage refinance or loan modification.

Aurora Loan Services has carefully reviewed your loan for home retention options. Aurora has determined that we are unable to continue pursuit of said options. A home retention workout on your loan has been denied for the following reason(s): Your finances indicate an inability to afford the monthly payments.

Never mind that I am current on every single payment, mortgage or credit card, despite being over $150,000 “under water” on my home. I have no equity and could have “walked” a year ago, but didn’t.

Notice the reinforcement I get for trying to stick with my home payments and pay down my debt, the Suze Orman recommendation.

Take a lesson. The banks own the government, and me, and you. I am finished with them. I am going to get out of debt asap and put my money under a mattress, where at least it somebody eats it, it will be Buppy the Puppy.


Filed under Business, Politics

Bent Britain

Bent Britain

I have a friend in the U.K. who reads my blog, and who sent me a favorite poem from the recent British poetry season. Yes, we may have football season and basketball season, but the Brits apparently have a poetry season. So the BBC picked this poem as a favorite from this season:

Bent Britain May 2009

We are bent Britain right now,
In this land of heroes,
The upper houses are
Reeking with stale piss.

We are bent Britain right now
In this land of tolerance
And hard won basic human dignity
Our elites
Are no better than tin pot regimes
Smeared with hypocrisy .

We are bent Britain right now
In the midst of sweated labour
The working people did everything
Asked of them; did everything the right way
The honourable way.And now look
As shattered dreams pile up in Swindon town.
Betrayed again betrayed again.

We are bent Britain right now
Treating our heroes from unwanted wars
Like discarded items on an accountants page ,
We don’t have room for the gurkhas
Our brave defenders ;
But everybody else is welcome.
We are bent Britain right now
As our bankers and money people
Have trashed us thrashed us
Robbed us skinned us
Like in some English public school brawl
They return to their dishonest lairs
To lick their wounds and sneer.
Looking for the next churn .

We are bent Britain right now
And we need our heroes again
Put the search out for our heroes!
Please blow the bugle
Torch the signal pyre
To bring us back or take us forward,
Just bring back our heroes!

Read it out loud to feel its power, especially on a day when the credit rating of the British government has been cut.

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Commenting on the National Broadband Policy

Wireless broadband in place
Image by Z303 via Flickr

I’m trying very hard to figure out how to comment on the proposed national broadband policy. There are so many moving parts to this puzzle that I don’t know where to begin.  But here are a few questions for the experts:

1)What constitutes true broadband? 768kbs is what the proposal says. Surely that’s not enough for video, music, education, gaming, X-rays.

2)And what about the difference between upstream and down? Now that we’re in Web 2.0 or its successor, people aren’t just downloading, they are uploading.

3)Should it be wired or wireless?

4)Who should pay for it? And how much? Public? Private?

5)And who pays for the schools? The libraries? The Indian reservations? The thinly populated areas not served by cable?

6)Do we need a rural broadband project like the Rural Electrification Project? If so, is broadband a public utility? Do we regulate it like electric utilities?

7) Should certain traffic pay more and be prioritized, like commuters on toll roads?

The debate on all of this started back in 1991 when Al Gore invented the internet, or at least the Information Superhighway, which in America looks more like the Information Back Alley compared to anywhere in Asia or Europe, where they have fast fiber to the curb. We have whatever the major carriers choose to invest in. In certain parts of the country there’s no broadband, and in others there’s no choice of provider.

We should fix this, before we fall even further behind the rest of the world. You should see Singapore, for example. Or Tokyo.

The FCC is asking for our comments, and there’s a nifty spot called Comment Express where you can upload even a white paper on the subject. Don’t forget to add the Docket #09-51 to your comment.

Before you comment, you might want to read what Debi Jones (aka Mobile Jones) has written or what Ars Technica has to say. They’ve been studying this stuff.

It’s not just a question of net neutrality, as if anyone understands what that means. It’s a question of costs, priorities, and national goals. You have until June 8 to weigh in. Don’t complain that you have no voice if you don’t take the time. Small numbers of passionate people can move mountains.

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Credit Card Companies Have Their Hands in my Pockets

I usually throw stuff from the credit card companies away without reading it. But since the econolypse I’ve had my rates raised for almost nothing: three days late was one excuse for raising my 0% promotional rate to 29.99%. (If I pay “on time” for the next six months it can come down again at their discretion, but by that time the promotion for which I opened it will be over).  And I don’t mean three days past 30 days, I mean three days past the billing date on the statement.  Not to mention the fact that Wells Fargo, my bank, taking advantage of the float, took its own precious time to auto-pay my bill.

Good thing I can pay this one off in full. But I can’t cut it up or close it, or it will hit my credit score. Although leaving it open and paid off also hits my credit score, because I have all that credit “available.”  From the time I got my first card in the early 70s, things have become remarkably more complex. And more expensive.

So I’ve begun to take more notice of the  incredible hubris of these banks and credit card companies, which goes unnoticed by a society largely without newspapers and focused by cable news on swine flu. No way you can tell someone who is busy with a family, or studying for a degree, or working two jobs that they MUST read the fine print. Fact is, they don’t. They rely on trusted institutions to deal fairly with them. (Insert rant here.)

Read the mail from your credit card company! You may get an unpleasant surprise as these companies race to do everything they can before regulation takes hold. I bet that at the end of the day, they will negotiate to have existing rules grandfathered in, because wait until you hear this, which greeted me at the mailbox today from my buddy Ken Lewis at Bank of America:

What is happening:

We are increasing certain transaction fees on your account.

Amendment to Your Credit Card Agreement:

Effective on June 1, 2009, the transaction fee (FINANCE CHARGE) we assess on each of the transactions identified below will be equal to 4% of each such transaction (Fee: Min. $10):

ATM Cash Advances

Balance Transfers

Bank Cash Advances

Cash Equivalents

Check Cash Advances

Direct Deposit Cash Advances

Wire Transfer Purchases

In addition, they are expanding the definition of foreign transactions to include transactions in U.S. dollars if they are made or processed outside of the United States. Each transaction posting on or after June 1 will be subject to the Foreign Transaction Fee, currently 3% of the U.S. dollar amount of each such Foreign Transaction.

Doesn’t seem too threatening, does it? Unless you order your business cards from a U.K. company, as I do, or buy stuff online at places like EBay. Truthfully, how often do you know where some of the things you buy are coming from, or whether you are engaging in a foreign transaction? I’m sure Bank of America is depending on that.

I can’t believe there isn’t more outrage at the way all this transpires.  Because there is a mailed announcement, and because parts of it are bolded, the banks can say they have disclosed. But is this what we thought we were doing when we opened a credit card account? We have woven plastic currency so deeply through the warp and woof of American society that most of us can’t untangle fast enough from these usurious practices.

Come on, American people, become outraged. Yes, you can stop spending, but of course that works against the very economy we are trying to save. As a society, we are in a Catch-22 that can only be resolved if the banks and credit card companies agree to act honestly and transparently, and unless we change our education system to provide our kids basic financial literacy skills. Ethics on the part of the banks would do less damage than if we all decided to rise up in the streets and tear up our plastic.

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Why Obama Has Slowed Down the Machine

Everyone I know seems to be saying that Obama has slowed down, rather than sped up, the recovery. The stock market is sliding and the rich are thinking of taking their money offshore. My friend Doris, a barometer of the economy because she’s been alive a long time, says this Depression feels worse than the one that happened when she was a child.

It’s been bugging me for a while why this is true, because I am a firm believer that all the things Obama says need to be fixed, actually DO need to be fixed (energy, health care, government contracting, the tax code). No one wants them fixed more than I do.

But a lesson I learned from the Apple Genius Bar will make clear what I think has happened.

I brought my MacBook into the Genius Bar because it was fairly new, but running too slowly. And I was getting frustrated. The Genius behind the Bar took one look in my Startup menu and gave me the answer. And I pass it on to you: Obama is running too many programs in the Startup menu. The Genius shut down all the little stuff I had downloaded to increase my efficiency, and the machine sped right up.

All those programs consume system resources. It’s as simple as that. The American consumer/investor doesn’t have enough RAM to deal with all those programs mentally. It’s slowing him down, and nearly paralyzing him. He doesn’t know what will happen to him next and is spending his spare time reading the stimulus bill, the TARP, the health care bill, and the tax code to find out what will happen to him. So of course he’s not at the mall, even if he still has money.

Start the machine with one program. It will run much faster that way. Then open the others when you need them, and when it starts to slow down, quit opening new programs and shut something down.

That’s what Obama should do with the country. Boot up the operating system, the economy,without anything else running. Let it run fast for a while, and then open one program at a time.

Why, with all the smart people in the White House, doesn’t this happen? Because Obama and his people are like all people with Blackberrys. They want everything to happen NOW, fast, at once.

Jack Welch was on “Morning Joe” this morning. He said that if any manager of a company tried to put in so many new initiatives at once he would whipsaw the employees and nothing would get done. I know this is true because I was guilty of that in my own companies. I actually, in my gay mad youth, MADE people fail because I wanted so many things done at once — and quickly.

So I’d advise Obama to slow down, get in touch with his breath, and focus.

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