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The Disappearance of Hillary Clinton’s Healthcare Platform

Single+Payee

By Benjamin Day | Common Dreams | March 30, 2016

What would happen if the media lifted the curtain on Clinton’s healthcare platform and introduced any level of scrutiny to her proposed improvements on the Affordable Care Act?

In an extraordinary magic trick, performed on a national scale, Hillary Clinton’s healthcare platform has been disappeared. While policy analysts, news anchors, and columnists have been engaged in an intense debate over Bernie Sanders’s “Medicare for All” proposal, Clinton’s incremental alternative has escaped almost all scrutiny – even among those who say they prefer it.

Combining the election-season writings of our most prolific, liberal-leaning columnists at the New York Times, Huffington Post, Vox, Mother Jones, Politico, The American Prospect, etc. you’ll find dozens of articles critiquing Sanders’s single-payer plan. None have mentioned a single Clinton healthcare proposal as a point of comparison – merely that she supports a philosphy of incremental reform.

Take Paul Krugman, a high-profile advocate of Clinton’s approach to healthcare reform. Krugman has published two op-eds in the New York Times and five additional blog posts arguing that “[progressives] should seek incremental change on health care… and focus their main efforts on other issues – that is… Bernie Sanders is wrong about this and Hillary Clinton is right.” In all seven pieces, Krugman focuses exclusively on Sanders’s single-payer proposal and fails to mention even a single Clinton policy.

The disappearance of the Clinton healthcare platform has even been carried out by pollsters. The Kaiser Health Tracking Survey included a bizarre question in its February 2016 poll, which was widely cited in the press. Respondents were asked to pick one of four possible directions for the future of U.S. healthcare. Among the choices were “The U.S. should establish guaranteed universal coverage through a single government plan” and “Lawmakers should build on the existing health care law to improve affordability and access to care.” Thirty-three percent of Democrats chose the single-payer option, while fifty-four percent chose the incremental option. The questions were clearly intended as stand-ins for the Sanders and Clinton healthcare proposals, but note that the single-payer option is a policy, whereas the incremental option mentions no actual policies, but asks respondents whether they support the (universally desirable) outcomes of improving affordability and access.

What would happen if the media lifted the curtain on Clinton’s healthcare platform and introduced any level of scrutiny to her proposed improvements on the Affordable Care Act? They would find two categories of Clinton proposals: some that are so vague they’re difficult to evaluate, and other more concrete plans that follow in the footsteps of one of Congress’s most practiced healthcare incrementalists: Senator Bernie Sanders.

For example, one of Clinton’s clearest incremental proposals is to repeal the Affordable Care Act’s poorly named “cadillac tax” on health plans with high premiums. She announced this proposal on September 29, drawing the ire of White House spokespeople. The move, however, followed in the footsteps of a Senate bill to repeal the Cadillac tax introduced by Bernie Sanders and seven Democratic Senators just a few days previously on September 24. Clinton’s position was correctly seen by reporters as necessary if she didn’t want to lose labor union support to Sanders.

“Because Clinton’s healthcare platform has received zero public scrutiny, she has had the luxury of floating other policy ideas in broad outlines, too vague to evaluate.”Many of Clinton’s well-defined healthcare proposals are rolled into a package of prescription drug reforms, which she released on September 22, 2015. They bear a striking resemblance to the Sanders prescription drug plan announced on September 1, filed as legislation on September 10. Both would legalize importation of prescription drugs from Canada, where costs for identical drugs are much lower due to Canada’s single-payer healthcare system. Sanders was a pioneer of importation, and in 1999 started driving busloads of American patients who couldn’t afford breast cancer drugs across the Canadian border. Both candidates call for empowering Medicare to negotiate drug prices – even Donald Trump jumped on board in January. Both would ban “pay-for-delay” deals between brand-name and generic drug makers, and increase prescription drug rebates for Medicaid and/or Medicare.

Because Clinton’s healthcare platform has received zero public scrutiny, she has had the luxury of floating other policy ideas in broad outlines, too vague to evaluate. Take the proposal to expand the use of Accountable Care Organizations. How? According to Clinton’s December policy brief: “In the coming months, [Clinton] will provide full detail on her plans for delivery system reforms that drive down costs.” With the primaries drawing to a close, no such details have been released. The same could be said of another proposal to “create a fallback process” to review insurance premium rate hikes in states that don’t already review rates. There has been no explanation of how such a plan would work, or whether it would require new legislation.

This is the double standard at work in almost all national coverage of Clinton and Sanders on healthcare reform: Clinton has been taken at her word that her incremental plans will be politically feasible, succeed in improving affordability and access to care, and are not shared by her opponent. Sanders on the other hand received intense public pressure to release details of his single-payer healthcare proposal, and when he did the proposal was subject to an avalanche of public analysis and scrutiny.

This double standard is all the more remarkable because single-payer healthcare is an established policy, practiced in one form or another in almost every developed nation in the world. Incremental reforms that work within the market-based healthcare system of the U.S. are far more uncertain, and deserve greater scrutiny. They are easier to enact but dramatically more likely to fall short of their goals. This is because incremental reforms in the United States usually focus on expanding access to care, without significant cost controls, in order to avoid opposition from the healthcare industry. The resulting policies are often unsustainable; make little headway against national trends of rising costs and eroding access; or simply move costs around (e.g. from premiums to deductibles and co-payments, or vice versa).

Previous national trends in incremental healthcare reform – from managed care through pharmacy benefit management, chronic disease management, narrow networks, and beyond – have often created lucrative new industries, but had dubious impacts on underlying healthcare costs or access to care. Most of Clinton’s healthcare platform falls exactly into these danger zones, and should be received with a critical eye.

The national discussion of single-payer healthcare reform is long overdue. However, when the full range of national media outlets force one candidate to run on real policies, while allowing another to run on values and aspirations, we aren’t having a real discussion of systemic vs. incremental reform, we are merely aiding the corrosion of informed democracy.

Benjamin Day is the Executive Director of Healthcare-NOW.

April 2, 2016 Posted by | Deception, Economics, Mainstream Media, Warmongering | , , , , , , , , | Leave a comment

Debunking the “War is Good for the Economy” Myth

By James Corbett | BoilingFrogsPost | June 18, 2014

The idea that the Great Depression was finally brought to an end by the onset of WWII has been a staple of history textbooks, documentaries and various war propaganda for decades. This myth continues to be perpetuated to the present day.

The idea that war is good for the economy is, needless to say, a fallacious argument which itself is based on incorrect economic data.

The idea that the economic activity surrounding militarization represents a net economic gain is called the “broken window fallacy.” This fallacy was named and identified by French economist Frédéric Bastiat in his 1850 essay, “That Which is Seen, and That Which is Not Seen,” in which he imagines the case of a shopkeeper whose careless son breaks a pane of glass in his shop window. In Bastiat’s example, ‘that which is seen’ is that the glazier comes, performs the task of fixing the window, and receives six francs for his effort. Onlookers to the scene believe that the economy has actually been bolstered by this act of destruction, since six francs have been spent into it that otherwise would not have been.

But Bastiat notes that what is important is not what is seen, but what is not seen: “It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.”

Similarly, production for war is the broken window fallacy writ large. Economic “gains” produced by government spending on munitions and vehicle manufacture and supplying and equipping the troops are not gains at all; money has merely been diverted to the pockets of the defense contractors via the political cronies in their back pocket.

So why is this important? Because sadly, this myth is being played on by the warmongering class to once again push the idea that war is good and even necessary for economic progress. This time it is not just manufacture of supplies or munitions that are being touted, but war’s ability to justify government spending on investment. No matter how unlikely the threat, or whether it is indeed completely made up, this warped thinking holds that such lies and exaggerations are the answer to our current economic problems.

Sadly, it is not just intellectual deficients like making this case. In a new op-ed in the New York Times, Tyler Cowen of George Mason University argues that technological advances from nuclear research to rocketry to internet and robotics have all been spurred by defense spending, and thus war or threats of war are necessary to continue the advance of civilization.

Why these technologies are ends in themselves, or more valuable than the tens of millions of lives lost in the previous “great wars” is a question left unexamined. Perhaps more to the point, Cowen never addresses why such advances could not take place in the absence of war or without the motivation of advancing the methods of killing as their impetus.

What is most fundamentally upsetting about the mindset that justifies carnage in the name of “economic gain” is that economic gain is usually measured in abstract concepts like GDP growth or increasing equities markets that have no or even negative correlation with the livelihood of the poorest members of society. Income actually shrank by 0.7% for 99% of Americans during the supposed “recovery” of 2009-2011. For the top 1%, income grew 11.5%. This is the type of “help” that massive government spending on bank bailouts and other stimulus measures invariably creates. In times of war, the situation is even more perverse: money is created as debt owed to the banks, backed up by the average working taxpayer, to pay politically-connected defense contractors to create bombs to kill poor brown people on the other side of the planet. This is called economic progress.

Taken to its logical conclusion, there is only one more effective way of solving the problem of poverty. After all, if we are willing to believe the lie that sacrificing lives is good for the economy, why not go that one step further…

June 20, 2014 Posted by | Deception, Economics, Mainstream Media, Warmongering, Militarism, Timeless or most popular, Video | , , , | 2 Comments

Paul Krugman’s Ignorant Assessment Of TPP Shows What A Nefarious Proposal It Is

By Mike Masnick | Techdirt | December 13, 2013

… It appears that Krugman has decided to discuss the TPP agreement after many of his readers asked him to weigh in. And his response is basically to dismiss the entire agreement as not really being a big deal one way or the other. The entire crux of his analysis can be summed up as: trade between most of the countries in the negotiations are already quite liberalized, so removing a few more trade barriers is unlikely to have much of a consequence. Therefore, the agreement is no big deal and he doesn’t get why people are so up in arms over it.

On his basic reasoning, he’s correct. There’s little trade benefit to be gained here. In fact, some countries have already realized this. But that’s why the TPP is so nefarious. It’s being pitched as a sort of “free trade deal,” and Krugman analyzes it solely on that basis. That’s exactly what the USTR would like people to think, and it’s part of the reason why they’ve refused to be even the slightest bit transparent about what’s actually in the agreement.

Instead, the TPP has always been a trade liberalization agreement in name only. Sure, there’s some of that in there, but it’s always been about pushing for regulatory change in other countries around the globe, using trade as the club to get countries to pass laws that US companies like. That’s why there’s an “IP chapter” that is entirely about building up barriers to trade in a so-called “free trade” agreement. It’s why a key component of the bill is the corporate sovereignty provisions, frequently called “investor state dispute settlement” (in order to lull you to sleep, rather than get you angry), which allow companies to sue countries if they pass laws that those companies feel undermine their profits (e.g., if they improve patent laws to reject obvious patents — leading angry pharmaceutical companies to demand half a billion dollars in lost “expected profits.”)

Krugman judging the TPP solely on its net impact on trade is exactly what TPP supporters are hoping will happen, so it’s disappointing that he would fall into that trap. Thankfully, economist Dean Baker, who does understand what’s really in TPP, was quick to write up a powerful and detailed response to Krugman that is worth reading.

However it is a misunderstanding to see the TPP as being about trade. This is a deal that focuses on changes in regulatory structures to lock in pro-corporate rules. Using a “trade” agreement provides a mechanism to lock in rules that it would be difficult, if not impossible, to get through the normal political process.

To take a couple of examples, our drug patent policy (that’s patent protection, as in protectionism) is a seething cesspool of corruption. It increases the amount that we pay for drugs by an order of magnitude and leads to endless tales of corruption. Economic theory predicts that when you raise the price of a product 1000 percent or more above the free market price you will get all forms of illegal and unethical activity from companies pursuing patent rents.

Anyhow, the U.S. and European drug companies face a serious threat in the developing world. If these countries don’t enforce patents in the same way as we do, then the drugs that sell for hundreds or thousands of dollars per prescription in the U.S. may sell for $5 or $10 per prescription in the developing world. With drug prices going ever higher, it will be hard to maintain this sort of segmented market. Either people in the U.S. will go to the cheap drugs or the cheap drugs will come here.

For this reason, trade deals like the TPP, in which they hope to eventually incorporate India and other major suppliers of low cost generics, can be very important. The drug companies would like to bring these producers into line and impose high prices everywhere. (Yes, we need to pay for research. And yes, there are far more efficient mechanisms

for financing research than government granted patent monopolies.)

Full article

December 14, 2013 Posted by | Corruption, Economics | , , , , | Leave a comment

Why Paul Krugman is Full of Shit

The Fed Works for the Very Rich

By ROB URIE | CounterPunch | April 23, 2012

Late last week Princeton University economist and New York Times columnist Paul Krugman wrote a piece on his NY Times blog that history will view as the best evidence to appear in at least several decades of the utter irrelevance of mainstream economics. The piece purported to respond to a Wall Street Journal editorial by Mark Spitznagel in which Mr. Spitznagel argued broadly the Austrian economists’ line that all government spending favors one group over another and more specifically that the Fed’s Quantitative Easing (QE) programs of recent years favor banks and the rich.

Mr. Krugman could have argued his New Keynesian shtick that government investment can prevent deflationary spirals in economic downturns and all would be as it was. Instead, he chose to argue (Plutocrats and Printing Presses – NYTimes.com), an astonishing amount of evidence to the contrary, that Fed QE policies have not disproportionately benefited banks and the very rich and were in fact enacted against their wishes and interests.

The basis of his argument has two parts:

(1) conservative economists argue that QE is “printing money,” they also argue that printing money causes inflation, banks hate inflation (because loans get repaid in less valuable dollars), therefore banks opposed QE and

(2) that banks earn profits from the difference between long term interest rates and short term interest rates (NIM, or Net Interest Margin), QE has reduced this difference, therefore the banks have seen their profits fall from QE.

Were these arguments used when writing about a (1) solvent banking system whose (2) profits still came from making prudent loans to creditworthy borrowers and (3) whose shadow banking system was immaterial  (couldn’t destroy the global financial system), then Mr. Krugman might have had a point. The facts, however, suggest that if bank loans and other bank assets were fairly valued the big banks would be conspicuously insolvent, that the entire impetus of banking consolidation and deregulation (as explained by bankers) was to reduce the impact of NIM on bank profits, and that building out the shadow banking system was the way that banks intended to accomplish this.

The housing crisis that began in 2006 is well known to most people, but it was part of a much larger build-up of debt by households and corporations at the behest of bankers. Among the “innovative” home mortgage types that put people who couldn’t afford regular loans into houses were “adjustable-rate mortgages” (ARMs). What set off the initial stages of the financial crisis was the realization that (1) a large percentage of people who had taken out mortgages couldn’t repay them under any circumstances and (2) if rising interest rates caused the mortgage payments on ARMs to rise then a much larger group of people would also default on their home mortgages. In 2007 – 2008 both of these realizations caused the value of the mortgage loans held by banks either directly or through securitizations (the banks’ own creations) to fall precipitously.

The same principle that rising interest rates cause the market value of loans and loan-type instruments to fall applied to an unprecedented quantity of assets held by banks in 2008, and still does today. However, the opposite is also true, when interest rates fall the market value of loans on bank books and in financial markets rises. As too much un-repayable private debt in the economy was what made the banks insolvent, lowering both short and long term interest rates has had far more impact on restoring the banks to faux health by raising asset values than profits from interest margin (NIM) possibly could have. The banks killed their ready supply of credit-worthy borrowers along with the economy in the 2000s— the only game they could play was to restore the market values of the garbage assets that they held. The Fed willingly accommodated this strategy.

The Fed wasn’t alone in its efforts to save the banks at all costs– the utterly corrupt actions by ex-New York Fed Chair, now Treasury Secretary, Timothy Geithner, and current Fed Chair Ben Bernanke to move bad loans made by the banks to other government agencies including FHA, Fannie Mae, Freddie Mac and an astonishing array of seemingly unrelated others, was tied to Fed asset purchases through QE. Readers may remember the low interest, non-recourse government loans that were used to induce hedge funds to buy garbage assets at no risk to themselves (non-recourse) to (1) get the assets off of bank books and (2) to create faux market prices for garbage assets based on contrived economics to thereby induce less sophisticated buyers to pay higher prices for the assets. The Fed itself bought assets at higher prices that it had driven higher.

The way that the Fed’s QE directly benefited the very richest Americans, in addition to the most recent vintage of richest Americans being bankers, is by running up the value of all financial assets. Fed Chair Bernanke gave a veiled explanation of how this works in his Jackson Hole speech from 2010 that can be found online. Mr. Bernanke calls his method the “portfolio balance channel,” and it is premised on two basic economic concepts, supply and demand and substitution. When the Fed buys assets it takes those interest-paying assets out of circulation and replaces them with cash. This reduces the supply of interest bearing assets in financial markets and replaces them with cash with which to buy other assets. It also reduces market interest rates thereby making stocks and other assets (substitution) more attractive.

But we need not rely on theory to see if this works the way that Mr. Bernanke theorized that it would. There are a significant number of rigorous analyses that were done demonstrating that when the Fed (or the ECB) is buying assets through QE financial markets rise and when the Fed stops buying they fall. The evidence is both unambiguous and voluminous. And in an anecdotal sense, there was some skepticism from Wall Street in 2009 when QE began but few if any doubters remain—it is absolutely the perceived wisdom on Wall Street that the reason that financial asset prices have been rising when they have is because the Fed is causing them to. The only question still out there for Wall Street is whether or not the Fed will continue to run prices up further?

How does running up the prices of financial assets directly benefit the richest Americans? Ironically, every three years the Fed also produces a survey of income and wealth distribution in the U.S. that is available on the Fed’s website. The data is broken out by income and wealth deciles. The quick answer to who benefits from rising financial asset prices is that the rich do because they own all the financial assets. See for yourself on the Fed’s website.

So far the Fed has tried to save the banks by keeping interest rates low and through various programs to dump toxic assets on the rest of us and it has revived the fortunes of the kind folks who looted the banks and stole our wealth (the very rich) by running-up stock prices. The Fed did this with QE1, QE1.5, QE2, QE2.5, “Operation Twist” and various less publicized programs with similar intent. The banks and bankers have absolutely loved these programs—read their research and you will see. On his very own blog Mr. Krugman referenced UC Berkeley economist Emmanuel Saez’s recent report stating that since the recession theoretically ended in 2009, the top one percent of income earners has received 93% of income gains. Mr. Saez’s research illustrates that it is the revival of capital gains from rising financial asset prices (including stock options granted to corrupt executives) that is behind the gains.

Finally, Mr. Krugman claims that the only way that banks could have benefited from the Fed buying assets was if the Fed overpaid for the assets. Fed Chair Bernanke publicly stated at the time Fed purchases commenced in 2009 that the Fed was going to overpay for the MBS (Mortgage-Backed Securities) it purchased in order to induce banks to sell them to the Fed. This was widely reported in the financial press at the time. It was also widely viewed as part of the ongoing (never ending) bank bailouts. Readers may recall the news reports from all of the Wall Street banks of perfect trading records (banks earned profits from trading financial assets every day) for several quarters in 2009. If the banks are winning then someone else is losing—thank you Federal Reserve. If Mr. Krugman can’t find credible contemporaneous reports of this then he should try a little harder.

Last, there is no ax to grind here with Paul Krugman.  Mr. Krugman has put a human face on his politics for which he should be thanked. But legitimate criticism of his economics includes the absence of the class struggle that Wall Street and the Federal Reserve clearly understand as evidenced by their actions—they are fighting for America’s rich and their policies are intended to benefit them alone. The sleight of hand that sustains mainstream economics is the claim that we all benefit if the system benefits. Take a look around and you’ll see that no, we don’t all benefit. In fact, were it not for the ideological drivel disguised as mainstream academic research, this would be evident to even the least interested among us. When in doubt, look a little harder.

Rob Urie is an artist and political economist in New York.

April 23, 2012 Posted by | Deception, Economics, Mainstream Media, Warmongering, Timeless or most popular | , , , , , , , | Comments Off on Why Paul Krugman is Full of Shit