I Love You Women

Ann Romney’s speech at the Republican National Convention had a well conceived message and she performed it generally without the kind of nervous, mannered delivery that typifies political spouses.  The primary theme was (directly stated) love and how that broad concept relates to women generally, but especially for women under stress.  What that stress might be was less defined, certainly including financial stress but also touching on everything from rearing screaming kids to eating off of ironing boards to breast cancer.  I was quite broke during college and shortly after, hardly received a penny from my parents, but I never had to eat off an ironing board – I feel incomplete.

The fact that Romney polls so poorly among American women, which is as much a malady of the Republican Party as it is for him, was the obvious motivation for the message she gave.  Like predictable movies; that message was expected and at the same time a bit boring, primarily because it didn’t equate the least with the reality of whom she is and what her husband supports.  With such a movie, one considers at the end that his eight dollars and two hours might have been more wisely spent.

However, her embrace of women on behalf of her husband wasn’t what interested me.  What fascinated me was how she continues to demonstrate a critical aspect of what she and her husband represent and how that may be a window on a Romney presidency.

In July I wrote of an important response Ann Romney gave to ABC news entertainment personality Robin Roberts during a special interview.  When asked about why her husband would not make public prior year tax returns (she files separately from Mitt) she said with some ire “we’ve given all you people need to know”.  I believe this was one of the most important statements made thus far in this presidential year.  What she meant by “you people” might be argued several ways, but I believe that “you people” to the Romney’s has no specific definition. I feel that to the Romney’s “you people” is anyone who isn’t “us”.  This reality has surfaced time and time again with Mitt and generally has been laughed off as his bumbling inability to relate to the so called common man.

Republicans argue repeatedly that the effort to increase top income tax brackets, even just slightly toward what they have historically been, is class warfare. What makes that such an interesting retort is that the concept of “class” doesn’t really exist in the US for a majority of Americans.  Throughout this Nation’s history the model of individual achievement has chipped away at a class structure that existed in western culture into the 20^th century, as nearly defined as the Indian caste system.  It was manifest in many ways not the least of which was who was eligible for financial resources and who was allowed to vote.  With the rise of the great Middle Class after the depression of the 30’s, class identification essentially disappeared for those Americans in that Middle Class.  In fact, the term “middle class” is really an oxymoron since the term middle more accurately describes a lack of social and economic class. The truth is that the only Americans who still view themselves as a distinct social entity are the financially privileged, and especially those who are second or third generation.  There is an irony that those who repel at “class warfare” are the only ones who believe there is “class” at all…or at risk.

When Ann Romney said with heightened passion “I love you women” she really wasn’t saying; I love you..women, she was saying I love..you women, conspicuously leaving herself out of the group.  Her husband is the same, quite a bit different than John Kennedy or Franklin D. Roosevelt, the two previous second generation privileged Presidents, who successfully became populous leaders even before their elections.  You’d have to go back to Howard H. Taft to find a second generation upper class President who embraced his elite stature, notably with little success as a President.

Mitt and Ann Romney have difficulty in connecting with average Americans because they themselves in reality feel no connection, no honest empathy.  The exclusivity and hierarchical nature of their Mormon Church and Mormon faith only intensifies this them and us attitude.  We can laugh and make fun of Mitt’s comments about his connections (NASCAR), his matter-of-fact consumption, or that “corporations are people”, for example.  We can squint at Ann Romney’s subtle “you people’ comments.  The reality is that their governance will be elitist; they will reign more than lead. They will also surround themselves with those of like kind, since their perceived class has always been fearful of those who don’t know the difference.   

The Gift

Where I work in a fitness center there is a member that caused me to pause the first time I saw him.  I had only been working there a short while when he crossed my path.  He didn’t recognize me, nor did I expect him to.  I recognized him immediately and just as immediately had to deal with unpleasant emotions.  This member had been my doctor at least one and a half decades earlier.  He called himself an internist, but he was really just a GP with a one man practice. I’ll call him Bob, not his real name of course.  I’d guess he’s currently in his 70s and likely retired.

He puts an immense importance on detail, at least when it comes to his workout, walking around with a virtual notebook in which he records every set, repetition, weight, and probably heart rate – every visit.  I would suspect that he is not a particularly spontaneous individual and likes the control that comes from compartmentalizing specifics.  He wasn’t my physician long, maybe 3 years or so.  I saw him infrequently and therefore cannot honestly say whether he is (or was) good at what he did relative to his peers.  I do know his one employee, his nurse/receptionist, was so unpleasant that we’ll just refer to her as nurse Ratched.

My animosity toward this man (and his sidekick) evolved from my last communication with them both.   I got sick – very sick.  I had flu-like symptoms which over a period of a couple of days would crescendo to levels of crappiness I couldn’t recall reaching before.  I resisted but finally called Bob’s office and asked to come in.  Miss Ratched receptionist switched to nurse Ratched and said coming in probably wasn’t necessary and I should first try a liberal application of aspirin and clear liquids.  At that point I was actually getting too weak to consider arguing. 

After another half day of feeling really bad I called back and asked if I couldn’t come in to see Dr. Bob as soon as possible.  I was rebuked for not waiting long enough to give aspirin and soup time to work.  I then started to plead (an embarrassing thing to recall).  Ratched finally said she’d talk to the Doc and he would call me back.  He did and essentially continued to rebuke me for my insistence and lack of metal, I suppose, for not dealing better with a simple flu.  He ended by saying I could come in…if I really had to.  It was the last words I would ever hear him speak.

Going to an emergency room didn’t seem like an option at the time.  Bob had convinced me that it was an ordinary illness and, besides, there isn’t too much in life I hate more than a hospital emergency room.  I felt lost and decided to ride it out. 

I stayed in bed maybe a couple of more days before I started to feel better, with one notable condition – I lost most of my hearing.  More accurately I lost some range to my hearing entirely.  This continued a week even as the rest of me began to feel quite normal.  I remember driving around in my little Ford pickup and having it sound like I was driving a Mercedes C-Class.  I wasn’t worried assuming the hearing would come back in time, which it did.  However, when it did come back something remained:  a loud “ringing” in my ears.  I had developed Tinnitus (pronounce tin-ah-tus or tin-eye-tus, either way).  It’s a non-threatening malady which is relentless and incurable, and can drive some people into mental illness.

There is also no magic pill to make it go away.  The only method that had any success was an odd one: it suggested that the victim of the “ringing” simply not listen to it.  It was odd because it isn’t a ringing that you actually “hear”.  Rather it’s an internal noise, not unlike that sound you hear by placing conch shells on both hears…only louder.  The idea was to accept the reality of the noise, then just pay no attention to it.  That sounded absurd.  Yet it wasn’t.  It took me months, but I learned to do it.  The hardest part was, of course, accepting it.  Now when it’s quiet and I’m suddenly aware of the loud “ringing” I stop, listen for a while as an observer, then get on with life.  The ringing has no power over me, so it’s pretty much the same as not being there at all.

More importantly, it taught me, in a very dramatic way, the importance of both accepting and not resisting.  One can intellectually know that not resisting and consequently accepting robs the force behind misfortune or conflict. Therefore, not being controlled by circumstance frees one to find solutions to deal with it.  However, it sometimes takes a real experience to make such knowledge intuitive.  This happened to me with my tinnitus and it was a gift.  It allowed me to have a multitude of similar experiences since and life, in general, is just plain better. 

Now when I see Dr. Bob I still think of him as a horse’s ass, but I also smile as he passes me with all his little notes and figures and silently say thanks.

Why Romney Won't Reveal His Taxes

(A reader of mine informed me that my blog of Aug 17^th, as it regarded taxes, was confusing.  I thought about it and concluded that writing a clarification was in order.  When a person is reasonably knowledgeable of a particular discipline or field  they can have difficulty in seeing the complexity of that which to them appears simplistic.  I don’t consider myself an expert in the tax field.  In the 31 years I worked either directly or indirectly with taxes I learned to respect, if nothing else, the vast amount tax information I would never have the chance to know.  Still, there are some things I’m comfortable in sharing and will try to do it better here.)

As much as he would like to tout it, the fact is that Mitt Romney was not a business man in the traditional sense.  He was a financier.  There is a difference.  Even the Bible differentiates the money lenders from the merchants and carpenters. The fact that he used the structure of a corporation to profit from his labors and that he and the other principals of Bain Capital employed staff to help him does not change anything.  He and his breed used an extraordinarily complex set of laws that enable “investors” to acquire, manipulate, and dispose of vulnerable businesses with very little downside risk to themselves.  Romney himself became a recognized master at it. In a simple Ron Paul-ian world of free enterprise I’m not sure a Bain Capital could have succeeded. My logical contention is that Mitt Romney has handled his own private finances in the same way, at least up until this run for the Presidency. The little he has revealed about his personal finances also supports that conclusion.

The complexity of US (and State) tax law is born of the fact that tax legislation alone cannot deal with the detail.  Certainly the legislation is voluminous and complex on its own, especially as it has been used for a century as a means of economic and social engineering.  It is the detail though that really makes one’s eyes roll.  The tax laws cannot address every type of human activity that involves money, not even close. The net result is the volumes and volumes and volumes of subsequent regulations and rulings that try to bring specificity to the tax laws.  It is a moving target and targets like Mitt Romney move pretty darn fast.

This complexity only benefits the wealthy who aggressively seek to minimize their tax liability. It is because our system is an honor system and the taxpayer is the first one to determine what is or isn’t taxable under the law. The wealthy (or wealthy corporations) have the resources to hire armies of tax attorneys whose sole jobs are to figure out ways of interpreting tax law for the benefit of their clients.  In doing so they weigh risk vs. tax benefit, and because the risk more often is just the tax that would have been owed and interest (plus a pitifully low tax penalty which is often waved) financiers like Mitt more often go aggressive. Why wouldn’t they?  It is a benefit that is available to everyone, yet exclusively theirs – the perfect paradox.

The only way aggressive tax interpretations by the taxpayer can be reigned in is through an IRS (or state) audit and, possibly, the subsequent fighting it out in Tax Court.  The IRS (and most states) must do that audit within 3 years of the date of filing. After that the taxpayer (barring negligence or criminality) is home free.  Given the nature of his value structure as demonstrated through Bain Capital, Mitt is likely to be one of those super rich who has interpreted tax law to his benefit and has done so aggressively. 

He is not overly worried about his effective tax rate, that embarrassment would be temporary, as it already has been for the one year he did publish.  No, he’s worried that Brian Williams will be interviewing respected tax authorities who will point out that Romney’s tax interpretations would have failed under an IRS audit.  What the public would take away is that he more than dodged taxes, he benefited by the vagaries of our laws at the expense of the American Taxpayer.  Not particularly Presidential or even laudable, except to the select few of the super rich who chuckle at sticking it to the “Government” (aka the American People or as Ann Romney puts it: "you people").  I have personally seen this, and it is not pretty.

Hooray for Harry

With the addition of Paul Ryan to the Republican ticket the Democrats seem initially to be making a mistake in judgment regarding their campaign.  Ryan may energize the far Right or Tea Party crowd, but it’s unlikely he would impact the election anymore than Biden has. More importantly, by redirecting attention to the multitude of Ryan ideological pronouncements they may let an important issue languish, if not die.  That issue is Romney's tax returns, which he is refusing to disclose. 

 Mitt has managed to dodge this criticism throughout his political life and he has apparently felt (to date) that he can do the same with this, his current contest.  If the issue is allowed to linger, especially by the media, Romney may again be able to neutralize it from being a relevant factor. He is hoping that people (and therefore the media) may generally just take it as a given that he will not release them and go on from there.  That would be a shame because this is a substantive issue, not just a source of embarrassment for Mitt.  It is the quantitative reality that the tax treatment of Mitt's wealth is a parallel for the constituency that likely benefits from a Romney administration. That reality is difficult for the average citizen to understand, and therefore it is extremely important that visibility be kept on the issue

Why is Mitt afraid to release the returns?  It's anybody's guess, but let me tell you mine. His fears are pretty practical, and it isn't simply the chagrin he might face from paying low taxes during any particular year. 

The US Tax Code is anything but black and white.  If the complexities of intimate relationships can be 50 shades of gray, the tax code is in triple digits.  The Code itself is thousands of pages alone, but much of how income and asset transfers are taxed has also been determined through thousands of court decisions which have created the US Tax Regulations and tens of thousands of IRS Letter Rulings, all of which are many times the size of the Tax Code. 

The US Tax System is essentially an honor system. Individuals are required to file with the Federal Government as tax law requires, but are allowed individual interpretations if the law is presumed unclear. Their interpretations remain unchanged unless an individual is audited and the taxpayer must defend their interpretation.  That audit must take place within 3 years of the due date of the filed return.  Barring a grossly unjustified interpretation (which might even be criminal), after those 3 years the taxpayer is free and clear. If Romney releases his returns with any time left for the army of Obama tax experts to review them I feel they would undoubtedly find errors and/or aggressive interpretations by Romney which would show he effectively (and possibly illegally) dodged a substantial amount of tax. This is a simple reality for individuals who have significant income earning assets and the means to employ expert and aggressive tax attorneys. It would be devastating to the Romney campaign and possibly a show stopper on the whole contest.

The importance of this disclosure is not simply the means to torpedo Romney’s chances at the White House.  There needs to be a demonstration to the American people just how extraordinarily vast the distance is between the wealthy and “middle class”.  Romney is a living metaphor for this problem that reaches much more deeply than a simple “class” struggle.  Nothing demonstrates this more than the way our tax laws have been weighted.

The absurdity of Romney, Ryan, and the Republicans to embrace the idea that to increase wealth for the super rich will increase jobs would be laughable in Econ 101.  Published statistics and research by scholars such as Edward Wolff of NYU show: the top 1% of households own more than 50% of all assets in America, if you factor out residential housing.  The top 20% own nearly 90%!!  The bottom 40% own about one-half of 1%.  Increasing this concentration will do absolutely nothing for the economy.  Yet, like the morbidly obese, Republicans don’t want to see that stuffing more money in their wide mouths only worsens an already dire situation.  

The primary origin of this so called “Great Recession” was the collapse of the housing market, which was quickly followed by a collapse in commercial real estate. It is also the reason for it lingering over the past 3 years.  Conversely, the great real estate bubble that extended from the late 90s to 2007 is what powered the growth in the US economy.  Why?  It did so because the driver of economic growth, and therefore employment, is a great number of people spending money, put simply. To do that a large segment of the population needs two things; a feeling of financial well being and a reasonable degree of predictability about their future.  Expanded real estate values accomplished both.

To push us in the right direction the Federal Government should force, if necessary, providers to refinance of home mortgages to current interest rates regardless of any other factors, flatten the tax rate of the middle class (not necessarily reducing taxes), increase top income tax brackets, and increase the holding period for long-term capital gains from one year to three years and disallowing long-term losses to offset short term gains (thus increasing short-term gains to be included as ordinary income).  Do you think this could happen with Romney in the White House?  The irony is, of course, by doing these things we would not only increase spending growth, more jobs, and improved budgets, but the rich (interesting) would do better themselves…but expecting Republicans to stop concentrating wealth would be like expecting Homer Simpson to ignore the plate of doughnuts laying on his belly.  By increasing the size of the pie and have most of that increase go to the middle class, everyone wins.

So when Harry Reid makes a wild accusation about Romney’s taxes keeping the issue alive I say hooray for Harry.  If it were me I’d be saying Romney earned income from child sweat shops in Malaysia, donated money to fund Gay Pride Day in Provincetown, MA, or takes child care credits for his six Mormon wives and eighteeen children in Utah – anything to keep the pressure on and the issue alive.  Forget about Ryan…he’s a jerk.

The GreaterTragedy

On a national news cable channel a portion of a video was played this week.  Made through the resources of an organization called Ready to Believe, it was of a sister of one of the shooting victims at the Century Multiplex in Aurora, Colorado.  She is an attractive young woman named Chloe Anderson and makes a poignant plea, with soft music in the background, for the viewer to contribute to an internet fund and to also pass the link for the video onto other potential viewers.  She shares in the video that the financial burden her family faces for the medical treatment of her wounded sister Petra is “daunting”, and they have the possible prospect of having to choose between treatment for Petra and her mother’s need for cancer treatment. As of the time I viewed the video six days after the attack they had raised $202,000. 

She will likely raise the money she needs. Hopefully her family’s burdens will be limited to the health issues they face and not insolvency.  If what the family raises exceeds their needs I suspect they will turn around and donate the difference, being undoubtedly selfless. The entire exercise is a highly visible version of requests for help one sees or hears about with some frequency.  Whether it’s televised pleas, news about bake sales, raffles, marathon marches, firehouse solicitations, church bazaars, or whatever, they all strike a sympathetic chord; moreover they put emphasis on the positive aspects of giving - the greater community helping, perhaps even saving one of its own without a quid pro quo.  It’s even routinely suggested that such action exemplifies the American spirit – independent and unconditional in its rugged resolve to rally around adversity.  To me the event itself has become the real tragedy and I seem to vacillate easily between feelings of nausea and anger.

The good citizens of this nation no longer lead their lives on wagon trains crossing the wilderness.  When times are tough we no longer can expect Sheriff Andy Taylor and Aunt Bea to arrive at the door with a basket of goodness, nor Marcus Welby, MD to cure what ails us in exchange for a wide grin of appreciation.  The greater tragedy is that for every such emotionally uplifting fund drive there are probably hundreds, possibly thousands of people who are forced to give up everything they own just utilize what John Boehner and Eric Cantor call the best health care system on the planet.  The entire sick Republican establishment continues to attack the Affordable Health Care Act (AHCA) and successfully get a majority of healthy, white, middleclass Americans to believe that begging to get help for health care is the American way.  For Republicans it is the American way, especially for those businesses on the receiving end of all those donations and estate liquidations.  The fact that Mitt Romney is campaigning on, among other things, the vowed repeal of AHCA is a testimony to power of greed and collective idiocy.

In 2014, provided Romney is not elected, everyone will have access to health care insurance, there will be no refusal of anyone for prior conditions, there will be no caps on coverage, and there will be caps on out-of-pocket expenses.  There is no clear evidence that overall health care costs will decline.  That is clearly step two.  The AHCA, when it takes effect in 2014 will reduce government health care costs by only a pittance, a mere $109 billion over 10 years, according to Congressional Budget Office, but it’s at least going in the right direction.  But whether we pay for health care as a nation in taxes (my preference) or insurance premiums we finally , as a nation, are in it together…all of us.  The reduction in costs will have to come from the providers, and it will be a battle.  Under the new law the insurance companies are now limited to 20% of premiums for administrative costs and profit.  That’s an improvement.  In all other advanced economies that percentage is in single digits.  We have a ways to go.

When will the American Conservative stop getting their warm and fuzzes by participating (vicariously or actually) in the charitable support of health care for pretty white people? They don’t realize or are too stupid to understand that the system they so lovingly embrace and the changes they so vehemently oppose are simply a manipulation by a really bad political party, whose true interests are very narrow.  Rank and file Conservatives or Tea Partiers should look in the mirror because, like most Americans, they’re not particularly attractive nor particularly gregarious and therefore unlikely to get many hits on their own internet plea for help. This is what they want to keep?

You People

In an interview last week on ABC's Good Morning America, Ann Romney was asked about her husband's refusal to release more than one year of prior tax returns (note: Romney has released only one tax return, the 2012 return which will not be filed until October 15^th – and probably released 3 days before the election – hardly counts).  Mrs. Romney departed briefly from her soft demeanor that attaches easily to subjects like family and God.  Like a politician she ignored the point that not releasing the returns created a speculation of deception and instead addressed the presumed deception that the users of that information would engage in. 

As I was watching she also said something curious and telling which Robin Roberts chose not to address. Robin, were you just not listening?  Mrs. Romney said regarding the tax returns "…we’ve given all you people need to know…".  With the clamor for Mitt's taxes (he files separately from his wife - which of course means she has significant income of her own) from Democrats, Republicans, Independents, pundits of all persuasions, and, of course, ratings hungry media types, it brings into question just who “you people” are - the American people, perhaps? The use of that phrase was telling because of its ability to make the obvious…well, obvious.  It also highlights the lack of insight on the part of the Obama campaign on the true nature of their opponent.

The Obama campaign has been targeting Romney’s character through relentless attacks on his stewardship of the Bain Capital Corporation.  Living here in Virginia, a hot swing state, we get to see it all.  Obama’s people have rightly concluded that they want to (early on) successfully point out that, for those who think they have no good choices for President, the choice of Romney is decidedly worse.  The Obama guys are, however, making a critical mistake.  Willard Mitt Romney is, as far as I can see, not a bad person. He is a lot of things; rich, attractive, stiff, inarticulate, loving father and husband, and (fortunately) a lousy politician.  He is also quite adept at making money through business (as opposed to, say, professional talents, such as with LaBron James or Leonardo DiCaprio).  His ability to make money or, more precisely, raising money is what made him appear critical to the survival of the Salt Lake Winter Olympics in 2002.  Just what does all that mean?

I believe it means that Romney’s skill set is all wrong for a political leader, not that he is personally evil in some fashion, or that his inability to sing demands ridicule.  I worked in tax, finance, and banking for 31 years.  One thing I learned is that those who engage in exotic business finance do so by working the system to their advantage and by paying large sums of money to experts (firms really) who figure out the ways for them to do it.  Such expensive expert advice is simply an investment for those businessmen, without moral judgment, since the only relevant quantitative ethical value is profit.  There is nothing intrinsically wrong with that, but one should not shrink from or distort that it is what it is.  It is done with two major goals; first, to appreciate the market value of an investment and, second, to avoid taxes.

The fact that certain business people close down businesses to extract the most money out of the carcass,  or ship jobs to foreign locations to cut costs (even if only speculative costs), or engage in oddball investments (like derivatives or junk finance) which knowingly create risks that can bring down an entire financial system should not be surprising or unexpected.  Pursuing activities that skirt the edge of legality because legality has not been established is not immoral; it is simply the absence of morality.  It’s like making an ethical judgment about a disease – pointless.  The lack of morality occurs when we choose to take no action to cure the disease, or sell ineffective medicines as an effective cure.

Out of this comes a separation between those who understand strikingly complex finance (and profit from it) and everybody else. It might include Bermuda based companies or accounts in Switzerland and the Cayman’s.  This separation can, and usually does, lead to hubris and false grandeur.  That Mitt Romney believes he should be the President of you people has been justified in his own mind by the level of success he has attained through the accumulation of wealth that only we people with financial savvy can figure out how to do.  It would hardly be surprising that he might want to prove to his dead father (who being successful in manufacturing and possibly looked down on financial manipulation for profit) that Mitt is the kind of man who is clever enough to be President where his forthright and charismatic father was not.

Taxes and Benefits 101

I decided to wade into Chief Justice Roberts’ recent opinion on the Affordable Health Care Act (aka Obamacare or AHA) to get a better understanding of why he blindsided Conservative Republicans by finding that the so-called penalty for failure to purchase health insurance was, in fact, a tax.  I started wading, but when I saw that the opinion was 192 pages long I was up to my neck before I knew it.  So, like a barnyard chicken, I began to peck about in the opinion until I felt I had consumed enough to be satisfied.  What I concluded was that Roberts had ultimately landed on the side of the obvious, and had, to his credit, minimized the influences of politics and ideology. 

My curiosity over his decision had been peaked by my own tax career background, since from the law’s inception I had always considered the mandate penalty portion to be a tax.  It met the simple definition of a tax (a charge usually of money imposed by authority on persons or property for public purposes – per Merriam-Webster).  When incurred it was to be collected by the IRS (a fact now presented by Conservative opponents as a revelation – who did they think was going to collect it, the Daughters of the American Revolution?).  That it was called a penalty was appropriate in my opinion. The fact of the matter is that the Internal Revenue Code is filled with penalties, and all those penalties when retrieved become part of the general revenue.  The reason the term is used at all is because the tax can be avoided by simple compliance by the taxpayer. An obvious example is the requirement on the part of the Federal Government that everybody who owes an income tax must file an income tax return.  That mandate doesn’t impose a criminal violation if someone chooses not to do it; rather such failure only adds a penalty onto whatever tax (plus interest) that the taxpayer owes.  Like the AHA, no one has to pay the penalty if they comply with the mandate.  Simple…no surprises. 

So Republicans, who had planned to be able to use the Court striking of AHA as a major failure of the Obama Administration,  now have to fight the particulars of a law which, when exposed to the light of truth, has much more upside than down. They start by symbolically burning Chief Justice Roberts in effigy, then screaming (occasionally in tears) that Obama deceived the nation into accepting an atrocious tax - something along the lines of charging a mother with child abuse because she tricked her boy into eating cauliflower by telling him it was white broccoli. 

The next major step is to once again portray the AHA as a “job killer” making repeated reference to the burden placed on business (which under the law means businesses having 50 or more employees – those with less than 50 employees actually get tax-credit benefits under the law).  This burden on business argument gets to me as well.  It ultimately clouds the relationship between employer and employee and the understanding of what compensation is.

In this country, the use of health care insurance as a benefit of employment is an accident of history, as are some other benefits.  Despite the problems these arrangements have created, it has become the primary means of delivering these insurance services to the public. Probably the most serious opponents to health care reform are those who obtain their health care insurance, paid wholly or mostly, from their employer.  What has been lost is that the cost of health care insurance has become misconstrued as a fixed expense of the employer when it is actually a variable expense of labor, otherwise known as compensation.  Employers have always treated it as compensation, but because they don’t directly see it, employees generally don’t.  Even worse, employees often look at such a benefit as largesse from their employers, like it was a gift. 

If under AHA an employer finds that they have to contribute more (or at all) to employee health care insurance plans, they will factor that into their overall labor costs.  The actual payer of those costs always has and always will be the employee, as a portion of their compensation is being directed to purchase that particular service.  That is why this “job killer” argument is so hollow and so political.  Small businesses have always had control of their labor costs, if they are well run. What kills them is a lack of market. 

What employers primarily want is predictability, which includes labor costs.  What would maximize that predictability would be to get employers out of the health care business all together, but because neither political party has the foresight (or cohunes) to get that accomplished (at least for now), the next best thing is to step away from the hodgepodge inefficient system we had prior to AHA, provide consistency of health care insurance coverage to the entire nation and then begin to work seriously toward the next step – reducing per capita health care costs.

The Biggest Scam In the History of Mankind

A listener of POTUS on satellite radio called in yesterday afternoon (6/12/12) to express his outrage of the Affordable Health Care Act.  The host suggested that anyone so angry over the law should be able to explain at least 3 things that induced such strong emotions.  The caller simply stated that the law was robbing him of his “freedom and liberty”.  When further asked for a specific of how his liberty was being stolen the caller, a man, said “I’m 60 now, when I’m 70 and maybe need a bypass operation the Government will decide whether I get it or not, no matter how much money I have”.  That was where it ended…how could it continue?

A recent ABC News poll (for whatever it’s worth) indicated that 70% of those polled were not in favor of the Affordable Health Care Act (AHCA).  Other reported polls track in a similar fashion.  This majority opinion is for a law which is almost a year and a half away from being applied in any meaningful way and which the GAO calculates a $500 billion savings of tax dollars over the next 10 years.  It doesn’t take a brain surgeon to realize something else is going on here.  The clear consensus (of who’s ever being polled) is that what we currently have is just fine…thank you very much.  What creates that kind of idiocy?

The unmitigated and truly tragic irony is that what we currently have is everything the critics of AHCA say the new law will create.  Our for-profit health care system which, by accident of history, is mostly tied to employment, contains within it the most inefficient, inequitable, and dreadful services any modern “system” could devise.  It is actually a full-out assault on our liberty, however you define it.  The inefficiency, inequity and mediocre quality are easy to show because they can be quantitatively determined.  Do the research and you’ll find those that argue for the status quo will highlight technical equipment and the desire of foreign doctors to practice in the US.  They chose not to follow the logic that manufacturers and doctors earn multiples of what they can anywhere else.  The statistics tell another story – do the research.  You’ll find the delivery of US health care is just great, as long as you don’t get sick…that’s your 70%. The problem is that the sick in this Country are a powerless minority.  What the 70% fail to realize is that any one of them could find themselves in that minority tomorrow.

What about liberty?  Even if you’re not sick our system penalizes you, if not actually promoting illness through anxiety.  Millions do not change jobs because of the fear of loss of health benefits. The will often chose jobs they don’t prefer for the same reason. There is a constant restriction on the choice of providers due to those not associated with one’s plan. Participants of plans are virtually at risk if they travel around the US, not so if they happen to be traveling around Europe or most Asian countries. There is a helpless submission to the modification of an employer provided plan including changes in benefits and cost.  And the cost…the cost is so mind-boggling high that logic would lead you to expect the streets to be mobbed in protest.  What’s going on?  Why the passivity?

Those on the receiving end of the $1.8 to $2.4 trillion annual transfer of wealth have used their resources to affectively buy an entire political party and convince you that any change to our health care system to reduce cost, increase access, and improve quality is great…as long as nothing changes.  The AHCA was originally a Republican idea.  They don’t really have any major problems with it.  They primarily wanted to make sure the “public option” was not part of it, as that would have been a possible first step to a single payer system.  They succeeded in that. Opposition to the law now is more political.  Call it “Socialism”, convince the stupid that their freedom, liberty, and American pride is at stake and ride that pony to the next election - simple. They even were able to label the law “Obamacare”, which had already been successfully used in Conservative circles as a negative term.  Most Conservatives don’t even know the actual name of the law. The term eventually was picked up by everyone; news media, progressives, and moderates included.  It’s one thing for you to name the neighbor you hate “the jerk”.  It’s quite another to get everyone else using the same name, even those who like the guy.  You know when I got a chance to know him I really like the jerk. These guys are good…but then look at the audience.

The AHCA will do little to change our broken health care system except increase access.  The most important thing it did, however, was to take us one step away from a completely dysfunctional system.  The Conservative Right and their very large moneyed interests that reap the benefits of that dysfunctional system have pulled off the biggest scam in the history of the world.  They have convinced a huge plurality of Americans to act against their own self interest.  Americans under 40 better wake up and realize that one person’s short term gain can be another person’s long term nightmare.

The Solution is Simple

You may have sensed there is a national debate in progress; it seems to grip almost everything. Although delineation of the sides involved would require some explanation, let’s just say our upcoming Presidential election more or less defines one camp from the other.  There are some folks in the middle, of course, but I believe they are generally a tired group and come this fall they may find football more meaningful than anything else.

The problem is that there really isn’t any debate at all.  What we have are two sides of a spectrum which acts like the rope in a tug of war.  A debate by definition implies the presentation of an argument, a refuting and counter-argument, and so forth until both sides are whittled to the essence of their cases and one side prevails.  

That sounds a bit like what we might think elections are all about, but not so today.  Today the “debate” is nothing more than pragmatic shouting and political gamesmanship.  Few are listening.  Further, most all the shouting is directed toward each side’s own choir.  Only the rope gets pulled and, at least right now, it’s pulling way right (Conservative).

Not only have we ended up with many tens of millions of people with anxieties related to national identity issues, but we have also generated run away Capitalism, unfunded entitlements, social-economic imbalance, irrational application of military resources, dysfunctional social justice, and government legislation (Federal & State) which has managed to reduce governance to just so many pissing contests.

Anyone who has read the entries of this blog know I strongly object to the direction we are being pulled by the so-called Neo-Conservatives.  Still I am not blind to the strong motivations of these many idealistic minded and decent, but fearing individuals.  There is a clear historic analogy in my opinion - American history at that. It is the American Civil War. The South was far more idealistic, more motivated, more unified, more dogmatic, and felt more threatened than the North.  

It was the election of Lincoln that was the last straw in an inflexible position for the South.  The election of Obama seems to have resonated in a similar way, and as with Lincoln, unyielding opposition started before Obama had flushed his first toilet in the White House.  Regardless how correct I might feel my understanding of this new divisiveness is, there seems to be no solution to this confrontation that pits brother against brother – then it hit me.  It was suddenly so obvious.

We need a Constitutional Amendment.  Not a permanent Amendment, but one that is self-repealing after 12 years.  The law would be extraordinarily simple to describe and foolproof to carry out.  It is this: once enacted and as of January of the following Presidential election year, no men (males) will be allowed to vote in any election, National, State, or local for the next 12 years. 

All political activity, social order, and law creation would be determined by individuals elected solely by women – 12 years so the law would cover at least two Senate elections in each state. That would do it.  The Country would be back on track, more over it might very well be on a better track than it ever has before.

You laugh (or just shake your head)?  If so, you don’t have the ability to see that our collective ship of state (i.e. all levels of government) has been slowly sinking in a vast pool of testosterone.   

Even the few women who have made the choice of political careers have been adversely affected.  If passed, within maybe 4 years women would hold a majority of political offices, maybe even the Presidency.  In that environment and with that constituency I can see most all of the Nation’s problems we face having a chance of being solved.  

It isn’t because women are smarter than men, more informed, more educated (although that might technically be true), wiser, or even less divisive.  They are not always better than men at what they do (I for one believe men drive cars way better than women – call me sexist).  It is for one simple reason:  most women’s identities are not threatened when faced with a competing idea – as a result, they listen, and often they do so empathetically. There would always be exceptions (think M.T. Green), but those numbers would be dwarfed by the majority.

We would gain a happy mix of practicality, individuality, and a respect for the common good.  For example take the almost intractable social problem of abortion: sure, women would remain divided among themselves on the issue, but they would have the ability to realize the value of reducing the total number of unwanted pregnancies regardless of anyone's position and would created unifying policy to that end. Men would rather go to war. 

Take almost any issue and think about.  If such an Amendment had gone into effect in 2000 I have virtually no doubt that my son would not have had to risk his life for two years in Iraq.

Could such a Constitutional Amendment be possible?  I can’t conceive how.  Still, an awareness of why it would work makes even the concept of it valuable.  Among other things, those so enlightened could vote more women into political office right now.  Perhaps men could just look around and start acting more like women when faced with controversy.  It’s possible.  

I do believe that if such an amendment went into place in 1852 (if Suffrage existed) that the American Civil War might never have happened, and yet slavery would have still disappeared.  There never would have been an epithet that said: the War that pitted sister against sister.

No Risky Business

A news story out of Ft. Lauderdale caught my interest.  It was one of those how stupid is that kind of stories that instantly makes National news, promoted by major media’s endless need to attract audiences.  It caught my interest not for its circus quality, rather for the context in which it exists, that affects almost all of us, nearly every day.

On May 8^th an 18 month old toddler was denied access on a JetBlue flight from Ft. Lauderdale because she had shown up on a terrorist “No Fly” list.  In fact, she and her parents had already boarded and were required to leave the plane.  How the media got wind of this would be interesting in itself.  According to the news story I read, the plane was held while things were being sorted out. The parents however, incensed by the incident and claiming they were held “on display” during the process, refused to re-board…and so it goes.

What makes this a Pop news story is, of course, its absurdity.  The outrage of the parents is a secondary news bit which touches on ethnic profiling (the family was of Middle Eastern decent) and potential lawsuits.  I don’t think any of those angles equate to the real story behind the incident.  I don’t believe it would have gained much traction had the story lead been “Ft. Lauderdale flight delayed 20 minutes while airline resolves conflict on flight manifest”.  I’d venture that or similar headlines could be churned out by the hundreds hourly. Yet I believe the real story behind this mini-fiasco would gain even less traction.

In financial investing there is a clear concept of risk-reward.  It is clear because the concept (in finance) is usually explained in quantitative terms (numbers), therefore it can even be understood by laymen; the greater the risk, the greater the extent of potential gain, but conversely the greater the extent of potential loss.  Buried in that concept is that there are consequences when there is an attempt to eliminate risk.  The negative connotations simply associated with the word “risk” cloud that fact and the reality that the risk-reward concept pervades perhaps all human endeavors.

The general uses of the term “risk” involve the feared loss of security or safety.  That “loss” can relate to almost anything, for example; property, “happiness”, relationships, careers, or life.  The financial advisor can sit down with a client and easily show on a piece of paper that doing nothing with your investments is neither prudent nor particularly safe.  But who is going to sit down with you and show that an inability to take risk with your time (i.e. actions) can prove counterproductive to your conception of what makes life valuable.  Although not quantitative it still is possible to explain to a reasonably open mind that doing nothing has a good chance of getting you nowhere.  But how possible is it to do the same for the "collective mind”?

We live in an age of pervasive externalized fear.  Of course to view extensive fear as unique to this time and place is as absurd as frisking down 18 month olds for hard core weaponry.  Fear, after all, is our basic primitive emotion for survival and the desire for survival has not changed since the Mystery began.  However, there is an unprecedented collective of fear that is unique to this age, born from levels of human population with no historical comparison and communication which washes over that population at speeds beyond the conception of its users. We are persistently moving in a direction aimed at removing risk from our social order.  The desire to do this relates directly with the communication of fear as applied to mass numbers of people.  Whether it be war, pestilence, violence, natural disaster, or simple loss of property (to name a few) we are beset with a perceived loss of individual control. We are becoming less concerned about the aesthetic short comings of ring around the tub, and more concerned with the deadly germs lurking beneath that ring and of whom may have failed to notify us of that fact for the protection of our children. 

The irony is that in the attempt to sanitize our world and reduce risk we begin to produce a lot of stupid.  The reason we have a situation such as an 18 month old detained because of her potential threat to our society is because there was no one, at that moment in time, who could or would take the small risk to quietly let her and her parents proceed to New Jersey.  The systems were in place to protect the nation from harm (and the company from lawsuits) and they couldn't be altered.  The net result was a whole lot of stupid and probably an equally absurd lawsuit to boot. This same scenario can be found almost anywhere, in our schools, our courts, our businesses, our governments, and all types of institutions. Think about it. That’s the real news story. Maybe that's why the lemmings eventually choose the sea.