Will Citizens United Sound the Death Knell for American Democracy

              Robert A. Levine    5-31-12

It may come off as hype even talking about the end of democracy in America, but one has to wonder about that as the repercussions of the Citizens United decision by the Supreme Court become more evident. America’s democracy has survived many hits in the past, but it’s possible this one could be a knock-out blow. And once down on the mat, democracy may not be able to get up again.

This consideration was raised by a recent Politico article reporting that Republican Super PACs will spend a billion dollars to try and elect their candidates in this election cycle. (http://go.politicoemail.com/?qs=482f87de1d55a93ceaa04945cb513295628728e3a741d9bd5de4fba222ff3263) These are not grass-roots organizations, but groups financed by a few big donors. For example, groups linked to the Koch brothers will spend about $400 million alone, organizing operations in important districts and states.

Now, there are those who will say ‘so what,’ and that campaign spending is like a popularity contest, where candidates with the most appeal raise the most money. And that the Democrats can also try and generate as much money as they can if they want to make the races more competitive.  And that money and campaign ads don’t determine the way people vote. And that Obama spent three quarters of a billion dollars on the last presidential campaign anyway.

In relation to the last argument, the money Obama raised and spent on his campaign was through his own organization and he vetted and was responsible for the messages that emerged. With the plethora of Super PACs now sprouting all over the landscape, extremely wealthy people can issue their own messages as they attempt to influence elections, often anonymously and with no constraints on what is said or how much money is donated.  They can distort opponents’ messages, say things out of context or with only a kernel of truth, or frankly lie or make up stories, with no one and no governmental agency to take them to task.

By buying up enough air time in major markets in the swing states, they can completely dominate the political dialogue in the presidential campaigns, restricting the ability of opponents to respond over the airways and drowning out any counterthrusts. These kingmakers can similarly impact Congressional and Senatorial races with their money, electing men and women with worldviews comparable to their own, thus being able to determine governmental policy.

Unfortunately, this control of the electoral process can become self-perpetuating, extinguishing the vestiges of democracy.  Instead of free and open elections, America could undergo a transition to a plutocracy, where the very wealthy have the power and make the rules. The only way this can be averted is if common sense limitations on campaign spending by individuals and corporations are instituted again. But how can this happen if our elected representatives, along with the president and Supreme Court are opposed to any restrictions?

Economic inequality in America will grow even worse in the future, as the tax laws and regulations are further shaped to favor the rich. And this will be more than matched by the disproportionate political power of the rich. If these Super PACs are allowed to continue to control the discourse, any semblance of fairness that remains in political campaigns and elections will vanish.

Some see a negative legacy from George W. Bush’s presidency as a result of the Iraq War and tax laws that increased the nation’s budget deficits.  However, I believe his enduring legacy will be his nominations to the Supreme Court, with its Citizen’s United ruling that gave control of the political process to the extremely wealthy.

James Madison noted in The Federalist Papers- “We may define a republic to be… a government which derives all its powers directly or indirectly from the great body of the people…not from an inconsiderable proportion or a favored class.” We are now moving away from this vision for our republic and whether or not this trend can be reversed remains a question.

Resurrecting Democracy
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Is Judicial Activism from the Right Alright

           Robert A. Levine     5-29-12

For decades conservatives have been assailing the courts for judicial activism, claiming the bench has been shaping or creating laws that override or ignore the intent of state legislatures, Congress and the Constitution. With judicial activism, the courts thwart the power of elected bodies to legislate, by ruling laws unconstitutional. This is the antithesis of judicial restraint, where the Courts accede to the elected branches of the government and uphold the laws they have enacted, giving them the benefit of the doubt when questions have been raised. Critics also note that precedents may be disregarded when the Courts attempt to legislate. However, now that the Supreme Court has tilted to the right, conservative voices are no longer being lifted against recent judicial activism, but praise the Court’s decisions.

A cry against judicial activism came from Southern conservatives when the Warren Supreme Court in a 9-0 landmark decision in 1954, Brown v Board of Education, declared state laws unconstitutional that authorized separate public schools for black and white students. The Court decided that these laws violated the Equal Protection clause of the 14^th Amendment. This overturned Plessy v Ferguson which in 1896 had ruled in favor of state supported segregation. Subsequently, in 1973, in Roe v Wade, the Court struck down anti-abortion laws that had been enacted by many states, by a 7-2 margin. Conservatives again saw this as judicial over reaching by the Court.

Since that decision, the Court has ruled a number of times limiting the scope of Roe v Wade with conservative approval. In 1980, it validated the Hyde Amendment, prohibiting federal funds from being used by indigent women for abortions. In Rust v Sullivan in 1991, it upheld regulations that banned abortion counseling and referrals from family planning clinics that received federal funds. In a number of other cases since, it has favored further restrictions on women’s rights to choose abortion. Since these rulings upheld state and federal laws, they could be considered judicial restraint rather than activism.

Other rulings by the Supreme Court have overturned local laws restricting use of guns and upheld laws that expanded gun rights. These decisions affirmed the conservative outlook of the Court, with judicial activism evident in the first instance when legislation developed by elected bodies was ruled invalid. Rulings narrowing the scope of the 1966 Miranda decision about a criminal suspect’s right to remain silent reinforced the Court’s leaning to the right, as did decisions regarding privacy, free speech and immigration.
However, the major manifestation of the Court’s conservative judicial activism came with its Citizen’s United ruling in 2010 that overturned decades of laws and precedents that had attempted to control campaign spending. Statutes had existed limiting corporate contributions in election campaigns since 1906, the most recent of which was the McCain-Feingold Act passed in 2002. This had been upheld by the Court in a 5-4 decision in 2003 in McConnell v Federal Election Commission. Then Citizens United overrode past precedent to strike down the provisions of McCain-Feingold that limited corporate spending in federal election campaigns, saying it went against the First Amendment that protected freedom of speech.

Conservatives had previously argued that judicial activism was only credible when protecting rights that were present in the text of the constitution, or if intent of the framers of the constitution had been evident. These criteria were not met in this bald act of judicial activism by the Court, unleashing Super PACs upon the country.

The question now remains how the Supreme Court will rule on the Affordable Care Act. Given the Court’s recent history of conservative judicial activism, it seems likely the justices will either find the entire Act or the individual mandate unconstitutional. When this decision is handed down, one can not expect any cries against judicial activism to come from the right.

Resurrecting Democracy
www.robertlevinebooks.com

High-Tech Immigrants Needed, but Immigrants Need Not Apply

                        Robert A. Levine    5-25-12

Engineers and scientists are desperately needed by many high-tech firms. However, positions are going unfilled because there are not enough trained Americans to fill them and immigration policy doesn’t allow enough visas to be granted to qualified immigrants who would be happy to take these jobs. And it’s not only in established businesses where immigrants bolster the economy. One study showed that foreign-born entrepreneurs started more than 25% of the technology and engineering firms in the U.S. between 1995 and 2005. Businesses created by immigrants generated $52 billion in sales and had 450,000 employees in 2005.

Foreign nationals now comprise the majority of scientists and engineers being trained in the U.S. for advanced degrees. For example, they account for 50% of master’s degrees and 70% of Ph.d degrees in electrical engineering. On an undergraduate level, foreign born residents earn 33% of all degrees in engineering, 27% of those in computer science, math and statistics, and 24% of those in the physical sciences. Each year vast numbers of students from abroad come to study in our universities, because the education they receive is superior to what they can get at home. Last year, 160,000 Chinese men and women were enrolled in American universities, about 60% of them pursuing engineering or science degrees. Yet our poorly conceived laws limit thousands of these scientists and engineers from obtaining jobs in our country after they graduate, even though they would prefer to stay and our high-tech firms would love to have them. We should be trying to lure these foreign graduates to work in America, rather than making it difficult for them to gain employment.

A Harvard Business School study found that almost half of the scientists and engineers with doctorates currently working in the U.S. were immigrants, and they accounted for 67% of the increase in American scientists and engineers between 1995 and 2006. The need for these educated foreign born workers will only grow as the Baby Boomers age and retire in the years ahead.

At the same time that immigration laws block many foreign-born scientists and engineers from working in America, China and India are actively recruiting those that are here, providing outsized bonuses and other inducements. As a case in point, according to the New York Times, China has been offering experienced professors and researchers bonuses of approximately $158, 000 to come back home.

The flow of these university graduates to their native countries from the U.S. can be considered a reverse brain drain, inverting the expected pattern of immigration. Federal funds subsidize the education of these scientists and engineers with grants to the universities they attend, aiding the economies of other nations and helping them to compete against us. America also loses the tens of thousands of patents and new technology these foreign scientists and engineers would have developed in our country, which would have created more jobs. These go instead to the nations to which they’ve returned.

Opposition to allowing more foreign scientists and engineers to work in America has come from some unions who claim that they drive down wages for American workers. Since there are jobs going unfilled in the high-tech fields because there are not enough scientists and engineers, the charge appears ludicrous. And foreign workers in these firms receive salaries that for the most part are comparable to American workers. In addition, bureaucrats in the Immigration and Naturalization Service have complicated the processes that foreign-born scientists and engineers must go through to work in the United States, making it more difficult for them to obtain jobs. But the real problem lies with the politicians hostile to immigration who have been against increasing the visas for educated workers.

Given the paucity of American students seeking advanced degrees in science and engineering, we should be handing out green cards and welcoming any potential workers or entrepreneurs in the high tech sector. We should also provide them with easier paths to citizenship so they will be more likely to remain. It will only benefit our economy in the long run.

Resurrecting Democracy
www.robertlevinebooks.com
                               

Earmarks- Playing Congressional Whack-A-Mole

                      Robert A. Levine    5-21-12

Congressional earmarks keep popping up no matter how much good government groups and sympathetic members of Congress try to suppress them. And many of the politicians who rail against earmarks are the ones who find ways to use them, keeping the earmarks hidden by labeling them differently or burying them within legislation. But an earmark by any other name…

The majority of House members and Senators decry earmarks in public and give the impression they would like to eliminate them permanently. But it seems as if you can’t keep a good political payoff down. The placing of earmarks in legislation has continued in spite of the supposed moratorium on this activity enacted by Congress in 2011.

Currently, a favorite strategy of lawmakers is to use special funds in spending and authorization bills for projects in their districts or states. As an illustration, early this year the budget passed for the Army Corps of Engineers contained 26 different funds totaling $507 million for construction, maintenance and other projects that were not part of the original bill. It has been noted by budget watchdogs that the funds for these 26 projects were approximately the same as the earmarks in the 2010 budget. The nation’s budget deficits and the need to reduce spending did not act as a brake for the members of Congress, who added more money for the Corps than the president had requested.

According to Citizens Against Government Waste (CAGW), the 2012 National Defense Authorization Act (NDAA) contained 111 earmarks. Of these, 59 utilized the exact language found in previous earmarks. A report from Senator Claire McCaskill’s office in December of 2011 found 115 earmarks in the NDAA. These cost taxpayers $834 million. Among those who requested the earmarks were twenty Congressional Republican freshmen who had campaigned against the practice. No surprise.
Further analysis by CAGW showed that 12 of 16 appropriation bills for FY 2012 that they had examined contained earmarks, with 251 projects totaling $9.6 billion. This is actually reduced since the moratorium went into effect, as earmarks in FY 2010 totaled $16.5 billion. However, transparency is now gone, with earmarks hidden within the text of legislation and not easily discerned. Earmarks previously were listed in a single table with the amount of the project, its location and with the names of those who requested the earmark attached to the request.

Unfortunately, past earmarks are still contributing to our budget deficits and wasting taxpayer money. An example is a drip pan for helicopters that attaches beneath the roofs to catch leaking transmission fluid. Congressman Harold Rogers, the current Chairman of the House Appropriations Committee, aka the Prince of Pork, requested as an earmark in 2009 that these pans be manufactured by a Kentucky company, a major contributor to him and to Republican groups. The cost to the Army for these drip pans, awarded without competitive bidding, was $17,000 each, compared to a similar pan from another manufacturer that cost $2500. The Army has already spent $6.5 million on these devices with more to come.

The Earmark Elimination Act, co-sponsored by Republican Pat Toomeyand Democrat Claire McCaskill, last year was an attempt to permanently end all earmarks, but was defeated when it came before the Senate in February. However, it seems that no matter what legislation is enacted that tries to eliminate earmarks, members of Congress and Senators will find ways to circumvent the ban. Politicians want to pay back businesses that support them in order to generate more campaign funding, and they want to finance projects in their districts to garner more votes. Thus, whatever laws the House and Senate pass against earmarks, they will always have loopholes that allow legislators to continue the practice they appear to oppose.

Resurrecting Democracy
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What Were They Thinking?- A Department of Justice Misstep

                Robert A. Levine   5-17-12

The Department of Justice’s anti-trust action against Apple and five publishing houses was a serious misstep. The action was pursued because of apparent collusion by the defendants in setting the prices for digital books. However, it appears that the DOJ did not carefully consider all the ramifications before instituting this suit. Lower e-book prices for consumers are not the only issue. The muscle that Amazon currently possesses in the e-book market was not properly taken into account.

DOJ essentially acted as an agent for Amazon in this action, enhancing its unbridled power in the publishing industry. Amazon currently has 60% of the e-book market, versus only 15% for Apple. By assisting Amazon in its quest to sell books from more publishers at lower prices, competition will actually be reduced in this market.
If Amazon were a foreign company selling goods in the US below cost, as they are now doing with many e-books, they would have been accused of dumping by the federal government instead of getting support for their marketing strategy. Amazon promotes e-books on its Kindle at $9.99, including best sellers and new releases. Most new releases through the Apple ibookstore sell at $12.99 to $14.99.

Unfortunately, the DOJ action may doom many independent bookstores, impotent in trying to compete against Amazon’s prices. The more e-books purchased on the Kindle, the fewer actual books the small bookstores will sell. And publishers will now be unable to set the prices for their books in an electronic format, with Kindle’s very low prices undercutting sales of more profitable hard copies. In all likelihood, this means that some major publishers will fail and many smaller publishers will also go out of business. With publishing companies already hurting, did it make sense for the DOJ to bring an action against them for trying to protect themselves against Amazon, a predatory marketer that already ruled the electronic book market?

Writers will also be harmed by the DOJ suit. With the number of publishers declining, those remaining will be less willing to take chances on unknowns or literary works, instead concentrating on acquiring blockbusters from authors with proven sales potential, or celebrities and politicians with a public following, cookbooks and how-to books. Many lesser known writers will lose the means of earning an income, and top writers may earn less. Though self-publishing and self-marketing is being increasingly utilized by writers, there are no editors to assist in the creative process or knowledgeable marketing people to help.
Barnes and Noble, which now has about 25% of the e-book market, will also be hurt, unable to offer the same breath of choices as their digital competitor, Amazon. In addition, as with independent booksellers, sales of hard copies of books in their bookstores will drop and they will offer fewer services to authors and publishers.

Jobs will be lost as bookstores and publishers go out of business and the number of titles is reduced. Salespeople, editors, copy editors, administrative personnel, warehousemen and clerks will all have to find new employment.

 This failure of judgment by the DOJ is reminiscent of the decision made three years ago to bring Khalid Sheik Mohammed to trial in New York. Security issues, cost and impact on local business were not properly considered, and eventually the DOJ had to back down. However, in this current case, three large publishers have already settled with the government and will change their pricing model, also agreeing not to block any retailer from discounting their digital books. Macmillan and the Penguin Group did not settle and will challenge the government in court. Perhaps their resistance will be rewarded.

 It’s hard enough for small retailers and big box stores to compete with the online giant Amazon. With publishers and independent bookstores, this difficulty is being compounded by the Department of Justice taking Amazon’s side in the selling of e-books. At this point, it appears that the genie is out of the bottle and corrective action for this DOJ misstep can only come through legislative measures. The chances of this happening in the current political environment are remote.

 Resurrecting Democracy
www.robertlevinebooks.com

Bolstering the I.R.S.

        Robert A. Levine    5-14-12

 With federal budget deficits and the national debt as major problems for the country going forward, why have Republicans been unwilling to fund more I.R.S. agents to pursue tax cheats and increase federal revenue? The 2012 Obama budget asked for an increase in funding for the agency, much of which would have been dedicated to hiring more agents and enforcement initiatives. However, Congress in its infinite wisdom instead cut the I.R.S. budget, forcing the agency to offer buyouts to over 5000 of its employees.

 A report by the internal monitor of the I.R.S. in January noted that the cuts in funding and an increased workload made the agency unable to adequately collect taxes or provide reasonable service to the public. In fact, staff reductions resulted in an inability to obtain billions of dollars annually owed to the government, but not paid. One estimate from I.R.S. data had tax cheating costing the federal government $3 trillion over the last decade. In addition, every tax filer has to pay an extra $2200 to the government to compensate for those taxes that are evaded. The great bulk of the tax avoidance is by wealthy individuals or small businesses. If with more agents I.R.S. audits rose significantly, much of the money now owed could flow into federal coffers, a good deal of it voluntarily through tax dodgers’ fears of being caught.

 The recent GOP House budget proposal emphasized cutting tax rates, while closing loopholes and deductions, but did not provide the I.R.S. with additional help to improve enforcement of the current tax laws. And in a cynical maneuver, the loopholes and deductions to be ended were not specified in the GOP bill, so that no estimate could be made of whether the revenue generated would be equivalent to what was lost with the tax cuts. Last year when the additional money was requested for the I.R.S., one Republican Congressman declared that no money would be forthcoming for “I.R.S. goons.” This is emblematic of the way many Republicans view the I.R.S; an agency whose powers should be reduced rather than expanded. And when service from the I.R.S. is not up to par, citizens’ hostility to the agency grows, which is probably what Republicans want.

 One would think that in this time when shrinking the federal budget deficit is so important to both parties and the electorate, the idea of collecting more money from tax cheats would be a no-brainer for the deficit hawks in the GOP. Not only would it bring in additional revenue to reduce the deficit, but it’s also an issue of fairness for those who pay their share. And getting it done would be relatively painless. Do Republicans hate the I.R.S. so much that they are willing to let fraud go unpunished and tax-evaders keep their ill-gotten gains?

 Republicans appear to be hostile to anything that has to do with taxes. While there’s little question that the tax code needs changing, the tax laws now in place need to be maximally enforced for the good of the nation. This should be done independently of cutting taxes, or reform of the tax code.

 Resurrecting Democracy
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Need for Centrist Third Party Grows

                        Robert A. Levine   5-10-12

 The increasing ascendancy of Tea Party activists and extreme right-wingers in the Republican Party reinforces America’s need for a centrist third party. Recent events have proven that there is no room in the GOP for moderates, or even moderate conservatives, with Senator Olympia Snowe retiring and Dick Lugar going down to defeat in the Indiana Republican primary. The extremists do not want those they describe as RINOs (Republicans in name only) to be part of the party. The idea of a “big tent” that would be all inclusive for the Republican Party has collapsed. And those pundits who predicted that Tea Party influence would diminish over time should dream on.

 In fact, even conservative conservatives, like Bob Bennett of Utah, are not extreme enough for the activists who now control the GOP. The unwillingness of the new Republicans to compromise with Democrats on virtually every issue will make governing in Washington even more difficult in the future. And thus far, every member of the group of House Republicans elected in 2010, known for their obstructionism, has won his or her primary in 2012. (http://politi.co/Jq46tS)

 It’s true that Lugar’s loss was due to a concurrence of factors, including his not having a home in Indiana, his age, a lackluster campaign, and his being out of touch with his constituents. But the major impetus for his defeat came from the Tea Party, outside conservative Super PACs, and right-wing organizations like the Club for Growth which demands a no tax pledge from all politicians. His opponents were unhappy with Lugar’s willingness to reach across the aisle to legislate at times and his votes for some Obama appointees. They were particularly upset with his support for the auto bailout, TARP and the START Treaty. Lugar’s concession statement is a testament to what is wrong with American politics. (http://wapo.st/LPBUTc)

 Another indication of how the Republican Party has changed for the worse is the recent exit of two apparent “up and coming” members of the party, Nathan Fletcher and Anthony Adams, in California. Both left to become independents, Fletcher running for mayor of San Diego and Adams for Congress. Their departure from the party was bemoaned in an OpEd piece in the LA Times a few days ago by former Republican governor Arnold Schwarznegger who criticized the direction of the party and lamented the fact that it was no longer inclusive. (http://lat.ms/JVpXJL)

 On the East Coast, Senator Joe Lieberman, an independent and previous Democrat from Connecticut, is also retiring, having found legislating in the current environment unrewarding and Sisyphean. And in Maine, Angus King is running as an independent for the Senatorial seat being abandoned by Olympia Snowe. King, who previously served two terms as governor, is immensely popular in Maine and is likely to be elected to the Senate. Because it’s possible the Senate may be fairly evenly divided after the 2012 election, King could hold the balance of power, determining which party is considered the majority and receives the all important committee chairmanships.

 It’s time, however, for men like King, Fletcher, Adams and Lieberman to look at the big picture in this country and join together to form an independent, centrist third party. This alternative to the rigid partisanship of the current political parties, that makes compromise and governing a nearly impossible task, is vitally needed for America to go forward. Organizing a national third party, finding a roster of candidates and getting on the state ballots will be a formidable undertaking. But there are numerous citizens and politicians unhappy with the nation’s political environment who might be willing to participate. Perhaps even some of the centrist Democrats and moderate Republicans who have left politics might be inclined to climb aboard. And centrist groups like Americans Elect and No Labels might be convinced to change their objectives and support a third party if people like King and Lieberman provided some of the leadership.

 As Robert Kennedy said, “Some men see things as they are and say why. I dream of things that never were and say why not?” Why can’t America have a centrist third party to bring common sense back to Washington?

 Resurrecting Democracy
www.robertlevinebooks.com

The GOP, the Health Insurance Mandate and Insurance Exchanges

                        Robert A. Levine   5-7-12

In America, politics trumps principles every time in this day and age, to the detriment of the democratic system. Even if a measure is consistent with a party’s principles, it will be rejected if it’s important to the opposition party and particularly if it’s part of their legislative agenda. The health insurance mandate and insurance exchanges are prime examples of this practice.

The individual health insurance mandate, which was formulated in 1989 at the conservative Heritage Foundation, a GOP think tank, was included in a bill introduced by Republicans in 1993. And in 2007, a bipartisan health care bill sponsored by both Republicans and Democrats contained the mandate. Another concept, health insurance exchanges, was also generated by the Heritage Foundation and is quite compatible with the free-market ideology of the Republican Party. But because these precepts are essential for the Democratic Affordable Care Act (ACA), they’ve been attacked unmercifully by Republicans, who have mobilized citizens against this legislation.

 The hypocrisy of Republicans in opposing these ideas is highlighted by two recent articles, one by Joe Klein in Time (http://ti.me/IEgTYB) and another by Jonathan Cohn and David A. Strauss on Bloomberg (http://bloom.bg/Iq3phu).

The individual mandate is a way to broaden the risk pools for health insurance. Because the mandate provides an incentive for healthy young people to obtain coverage (by a financial penalty if they don’t), insurance companies will be able to insure individuals with pre-exiting conditions and not lose money. Without the individual mandate, insurance companies could not afford to cover those who are already sick or injured.
In questioning the constitutionality of the mandate when the ACA came up before the Supreme Court, Justice Scalia raised the possibility of a “broccoli mandate,” with government forcing citizens to buy broccoli. However, a well functioning market for food and broccoli already exists, and there is no national crisis regarding broccoli as there is with health care costs, so this argument was spurious. Similarly, the analogy of a burial insurance mandate put forth by Justice Alito was fanciful since there’s also no crisis in this area. As a possible precedent for the individual mandate, Cohn and Strauss cite the Militia Act signed by George Washington in 1792 that required all men to purchase a gun and knapsack to defend liberty. Is that very different than requiring every citizen to purchase health insurance?

As for the insurance exchanges, Klein notes that they are a “classic Republican idea ..employ(ing) market discipline to control prices.” In addition, they allow insurance companies to compete to enroll members by providing transparency about prices and benefits. Yet because the Affordable Care Plan and its provision for the exchanges were passed by the Democrats, the GOP is fighting the exchanges on a state level where there have been attempts to implement these marketplaces.

Whether or not the Affordable Care Plan is the best way to reform health care is beside the point. Republicans are trashing concepts they originated and previously supported simply because they have been advanced by the Democrats and don’t want to provide the Democrats with a political victory. This is emblematic of the way business is conducted in Washington and why the political parties and Congress have such low public approval ratings.

I personally believe a single payer system, with physicians on salary to eliminate financial incentives for unnecessary care, along with malpractice reform, is the only way health care costs will be brought under control. Since this is unlikely in the current political environment, I’m willing to give the ACA a chance to see whether it meets its stated goals. Although Republicans have been attacking the ACA, there have been no realistic plans put forth by the GOP to provide coverage to the uninsured while attempting to control costs.

Resurrecting Democracy

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Dysfunctional Washington- What Does the Future Hold?

                   Robert A. Levine   5-3-12

With the vast majority of Americans disgusted with Washington and polls showing that Congressional approval rates are in the toilet, can we anticipate that the discourse might improve in the future? Can we expect that politicians will take citizens’ displeasure to heart with positive steps to improve the atmosphere in Washington, so that the important business of the nation can be accomplished? Unfortunately, the answers are no and in fact it is more likely that the political climate will deteriorate in the years ahead.

A recent article in Politico by Charles Mahtesian and Jim VandeHei spelled out the reasons why the situation appears so bleak.( http://go.politicoemail.com/?qs=67d22cc68366780fe484783c07fb312183a2b7697dbdc4f50575b972c7aae470) Basically, it’s the loss of centrists and moderates on both sides of the aisle with greater polarization in both the Senate and the House. Whereas twenty years ago, 40% of Senate Republicans were considered moderate, barely 10 % can be so-labeled today. In the House, it was 30% twenty years ago and almost none currently. Similarly, moderate Democrats now constitute 12% of the party in the House versus 35% in 1989. Moderate Democrats in the Senate are 15% compared to 27% 20 years ago.

The refusal of Tea Party activists to support any Republican who is not to the extreme right of the political spectrum has resulted in moderate conservatives being shunted aside in Republican primaries or having to retire. And right-wing conservative Super PACs, from outside the contested state or congressional district, with vast sums of money since the Citizens United ruling, have supported the most partisan candidates with attack ads. To make matters worse, the candidates being skewered cannot respond effectively to these ads, as they don’t have the financial resources to mount a defense.

Centrist Democrats have also gone down to defeat or retired, with the liberal wing of the party and organized labor going after incumbents who have not hewed to the party line, particularly in regards to health care. This is particularly true in the House where Jason Altmire and Tim Holden were just defeated in Pennsylvania Democratic primary races. The list of moderate Democrats Senators not running for re-election include Ben Nelson of Nebraska, Joe Lieberman of Connecticut, Kent Conrad of North Dakota and Jim Webb of Virginia.

Republican moderate Susan Collins of Maine is also retiring along with moderate conservative Kay Bailey Hutchinson of Texas. The reasons for all of these retirements include the partisanship in Washington and the inability to legislate effectively. In addition, there’s the fact that campaigning opens up moderate candidates to blistering attack ads, often personal in nature, augmented by Citizens United Super PAC money. As examples of internecine combat in the Republican Party we just have to look at the battles Oren Hatch of Utah and Charles Grassley of Indiana are going through, because these long time conservatives are not deemed conservative enough by extreme elements in their party. Interestingly, Oren Hatch received a 100% rating from the American Conservative Union and the Chamber of Commerce in 2010, but that isn’t considered adequate by the far, far right. Maybe it’s the fact that in the past, they were willing to talk across party lines and were even cordial at times to Democrats.

The loss of moderates in the House and Senate are going to make compromise on any issue more difficult to accomplish, and the atmosphere in Washington is bound to become even more toxic. Perhaps the saddest aspect of the current political climate is the fact that the moderate middle, including independents, moderate Republicans and centrist Democrats, has no bloc to represent their views, despite the fact that they are the largest percentage of voters.

 To change the political environment so that government can function again, campaign financing reform, including limitations and transparency on Super PAC donations is necessary, despite the Citizens United ruling. Perhaps it will take a constitutional amendment, but it must happen if American democracy is to prosper. And the way both the Republicans and Democrats have evolved over the past several decades, it is evident that a third party of the center is needed to represent the moderate middle and bring common sense and compromise back to Washington. Neither of these remedies will be easily accomplished, since both current parties and the deep pockets behind them will fight fiercely to keep these prescriptions from being realized.

 Resurrecting Democracy
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A Reminder- How Government Helps Make the "Self-Made" Man

                                    Robert A. Levine   April 30, 2012

There are myths proclaimed by some right-wing partisans and Ayn Rand acolytes that “rugged individualists” working alone have been responsible for America’s great accomplishments and that government is the enemy of progress. In their quest to reduce taxes, particularly for the wealthy, and cut the size of government, this myth has been promulgated by ideologues to gain support from the middle-class, needed to elect legislators who share their vision.

Unfortunately, many Americans have accepted this narrative and because of it, often vote against their own interests. In a recent essay, The Future of History, Francis Fukuyama noted “individuals are not sovereign entities, but beings heavily shaped by their surrounding societies.” Pounding away at the failings of “big government,” conservatives have ignored the positive effects of government and the fact that no one in the modern interconnected world is able to make it on his or her own. Aside from its role in national security and protecting Americans from foreign threats, the federal government is a necessary part of citizens’ everyday lives and provides the internal fabric that holds the nation together. Unlike the 18^th century, for an individual to be successful in this day and age, government help is essential.

Businesses could not function without the nation’s infrastructure (though it currently needs work). Building the interstate highway system, bridges and tunnels and maintaining them, was and is a federal concern. The integrity of America’s ports and airports, and air traffic control, all comes under the aegis of federal agencies. Products and people could not move if it were not for the government. Apportioning the broadcast spectrum for TV, radio, cell phone companies and so forth, insuring the safety of transmission lines, pipelines, and so forth, are all functions of the federal government.

In addition to regulating interstate commerce, international trade agreements negotiated by the federal government set the ground rules for US trade with other nations, and have opened up markets for American products. American businesses are also protected by the government when foreign companies dump their goods in this country. Intellectual property rights, here and abroad are nominally safeguarded by the government, though in this area federal agencies have fallen short. The Export-Import Bank helps American companies sell their products to other nations.

Funds for research and development, since WW II, have come from the federal government over and above the private sector and have resulted in many benefits. The development of much of the Internet, global positioning systems, drones, came from work funded by DARPA (Defense Advanced Projects Research Agency). The NIH and funds for medical research have led to many advances, including treatments for cancer and other diseases.

Educational standards are promoted by the federal government and funding is provided to support K-12 schools and higher education, in addition to Head Start. Pell grants, Stafford loans and other programs allow many students to attend colleges they would otherwise not have been able to afford.
The safety of the foods Americans eat and the medications they use are federal government responsibilities. Federal regulators protect investors from financial predators and uphold the integrity of the banking system.
The government provides a safety net for older people and the disabled through Social Security, keeping them from impoverishment. Medical care for seniors and those who can’t afford it is covered by Medicare, Medicaid and other programs.

Businessmen and entrepreneurs need government to help them communicate with their suppliers and customers, receive materials and get their goods to market. The educated work force that businesses require depends on the local, state and federal governments, with federal agencies providing a supervisory role and extra funding. A large part of the health and safety of their workers is a federal responsibility. People who claim to have made it on their own are either unwilling to acknowledge the actions of government for ideological reasons, or are engaged in self-promotion.

The federal government is inefficient in many of its operations, but its expansion has occurred during both Democratic and Republican administrations. Those who rail against the government should focus on fixing it and not just making it smaller so they can pay less in taxes. And the money saved should go to paying down the deficit. For different reasons, both the weak and strong among us need a robust federal government in today’s world.

Resurrecting Democracy
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Corporate Ethics- An Oxymoron?

Robert A. Levine 4-26-12

Two front page articles in the New York Times earlier this week reminded me of just how pervasive the lack of ethics has become in the corporate world, where making money is the only thing that counts. Perhaps the same level of corruption has always been there but is reaching public awareness more frequently now.

One of the articles was about the way Walmart’s business in Mexico had been able to expand rapidly by bribing officials to expedite the necessary permits. When an internal investigation by Walmart uncovered this corrupt behavior in 2005, it was suppressed by corporate executives and those involved were allowed to go unpunished. In fact, the major figure responsible was subsequently promoted to vice-Chairman of the company.

Another report examined the actions of insurance companies in changing to a new payment method for out-of-network care. This change increased patients’ costs while it saved the insurance companies money. However, this new method contravened a previous settlement the companies had made with New York State over manipulation of data that was supposed to improve payments to providers and protect policyholders from additional costs.

Also this week, 60 Minutes on CBS examined the fraud and deception by Lehman Brothers officers prior to its bankruptcy in 2008. To date, none of the executives of Lehman Brothers, including the Chairman Richard Fuld, have been charged with criminal activity by the government. They have been able to walk away with tens to hundreds of millions of dollars obtained at the expense of shareholders.

Similarly, none of the executives of any of the other financial firms that precipitated the recession, and necessitated the bailout by American taxpayers, have ever been brought before the criminal bar of justice. Angelo Mozillo, Kerry Killinger, Stanley O’Neal, Charles Prince are but a few of the names that live in infamy. Reports have confirmed that these executives and others provided false information about their companies to stockholders, investors and regulators or condoned activity by employees to make it seem as if their firms were healthy when they were actually in dire straits. They also vetted investment vehicles, like CDOs, they knew were of poor quality to unsuspecting buyers. There were real estate loans as well, approved for applicants by mortgage brokers even though it was known the applicants could not afford them. Unsurprisingly, these loans subsequently went bust and contributed to the economic meltdown. But the more loans handed out, the greater the bonuses received by the mortgage brokers and banking executives.

There are also instances of short cuts taken by corporate executives to save money that increased risks and flouted safety regulations, resulting in deaths or environmental damage. BP fits into this category with its Alaska pipeline spill and Deepwater Horizon blowout in the Gulf. The mine explosion in West Virginia in the Upper Big Branch mine owned by Massey Energy that killed twenty-nine miners is another example.

At random, other instances of corporate malfeasance that come to mind include the Enron debacle, the TYCO scandal and the Savings and Loan scandal. But in addition to these illustrations of corruption that are well known to the public, there are almost daily instances of illegal and unethical behavior by corporations and their executives to enhance corporate bottom lines along with executive salaries and bonuses.

Capitalism provides people with the opportunities to make money. Human nature drives some of them to illegal or unethical behavior to increase their remuneration. It is up to the government to provide a strong regulatory structure and prosecution of lawbreakers to minimize corrupt behavior. This also helps the economy by maintaining a level playing field so that honest businessmen and women have a fighting chance in the marketplace.

Resurrecting Democracy
www.robertlevinebooks.com

The Big Game Redux

The Big Game Redux

            Robert A. Levine   4-25-12

Last week in an article entitled The Big Game, I decried the skewed funding by state and local governments that favored athletics over academics. I focused particularly on Texas, where there was inordinate spending on high school athletic facilities and coaches while funding for teachers and academics was being reduced. College coaches were also receiving outlandish sums compared to faculty members, while student tuition was being increased. I noted that this emphasis on athletics over academics did not bode well for the United States in terms of the nation’s ability to compete economically in the years ahead, since an educated populace is a vital resource.

An article yesterday by Jordan Weissmann in theatlantic.com (http://bit.ly/IrgVUe) describes a situation that has arisen at the University of Florida in Gainsville where its sports budget has been increased at the same time funding for its computer science department is being slashed. This is the result of the state cutting the university’s budget by 30% over the last six years, a total of $240 million. Much of the athletic department budget is covered by $36 million in annual contributions from alumni, and the athletic department does generate income for the school, providing $6.1 million to the university’s operating budget last year. However, if the state and the university’s alumni had some foresight, they would be funding an expansion of the computer science department before contributing money for sports. Florida and the nation will certainly derive more future benefits from the computer scientists that the university produces than from its football players.

Resurrecting Democracy

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Moral Hazard, Health Care Coverage and the Individual Mandate

            Robert A. Levine   4-23-12

Whether the Affordable Care Act (ACA), now before the Supreme Court, will survive in its current form is in some doubt, with the individual mandate particularly in danger of being overturned. Though Congress has the power to regulate interstate commercial activity, opponents of the law believe it can not impose a tax or fee on inactivity, such as the failure of citizens to purchase health insurance.

The individual mandate was included as part of the law to pressure young healthy people to obtain insurance. This was to balance the cost of insuring men and women with chronic illnesses and pre-existing conditions. Without the mandate, it was believed many young Americans would not bother with coverage, as is currently the case. If that happened, writing policies for those with pre-existing conditions would not make financial sense for the insurance companies, or the premiums would be too expensive for those who were sick.

Many individuals in their twenties and thirties do not see the need for heath insurance, assuming they are unlikely to become seriously ill or injured and that it is a “waste” of money. They know that if necessary, they can always receive Emergency Room care without insurance, and think they will be able get coverage after the fact. And if medical expenses become crushing because of a major illness or injury, the involved person (having limited assets) can simply declare bankruptcy, erase the debt and start over. This is a prime example of moral hazard, where the economic risks of illness for uninsured people is placed on the backs of others.

Health insurance allows individuals to receive care without having to worry about financial ruin in case they are faced with unexpected medical expenses. An immediate expenditure of funds to buy coverage guards against the possibility of much greater losses in the future. Carrying health insurance requires men and women to take responsibility for their own well being and not be dependent on the social safety net should they fall ill. It is unfair to other citizens for uninsured people who can afford coverage to receive medical care. It means their care is paid for by government subsidies to hospitals (which is bourn by taxpayers) or by an increase in insurance premiums for all policyholders. However, as long as men and women know they can obtain medical treatment in Emergency Rooms or walk-in clinics, and that they will be hospitalized if necessary even without coverage, there is less incentive for them to purchase insurance. And bankruptcy is an easy way for young people who have not yet accumulated significant assets to discharge debt.

If the ACA or the individual mandate is voided by the Supreme Court, a way must be found to persuade reluctant citizens who have the financial means to buy health insurance. A law that prohibited medical facilities from providing care to those who did not have coverage would certainly be effective, but this is a non-starter. It contravenes societal and medical mores about treating sick or injured patients regardless of economic circumstances. A more realistic approach would be to enact a law that prevented medical expenses incurred by uninsured men and women from dismissal through bankruptcy. Citizens who were irresponsible and neglected to obtain insurance would be indefinitely liable for all their medical expenses, eliminating some degree of moral hazard.

If this measure were passed, those who were too poor to pay for coverage would enroll in Medicaid and those who could afford it would be more inclined to purchase insurance. Allowances would have to be made for people who were emotionally disturbed or mentally impaired.

Though not a perfect answer, the above strategy is a logical approach to the problem of citizens who choose not to purchase health insurance, shifting the cost of their care onto the government and those who have coverage. If the individual mandate or the Affordable Care Act is overturned, Americans who are not obtaining health insurance might be motivated to do so by legislation that does not let them off the hook for the medical expenses they incur.

Resurrecting Democracy
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Turning Back the Clock Politics

                    Robert A. Levine   4-19-12

The gridlock in Washington and the difficulty Congress has in passing significant legislation does not require intricate analysis and pontificating by pundits over its cause.

Conservative initiatives that would have Americans live in the past are the main divide between conservatives and liberals or moderates. It’s the reason conservatives want to expel moderates from the GOP whom they label as RINOs (Republicans In Name Only). The more conservative a politician is, the more he or she sees the past through rose-colored glasses and wants to move America back in time. They want to go back beyond the Great Society of Johnson, the New Deal of Roosevelt, and even measures favored by Nixon such as the EPA.

Examining conservative stances, their love affair with the past becomes readily apparent. Smaller government and lower taxes head the list. This is in disregard of globalization and the problems raised, the complexity of citizen’s lives, the need for an adequate safety net, protection against external and internal enemies, a suitable infrastructure for the nation, food, drug and environmental monitoring, safety standards for air travel and automobiles, allocating the wireless spectrum and off shore drilling, and numerous other functions of government in the modern world. Conservatives would like to shrink the federal government’s role and spending in virtually all of the above areas, except for the military.

As for lowering taxes, America’s marginal income tax rates are among the lowest they have ever been and among the lowest in the developed world. During the early 1950s through 1963, the marginal tax rate was above 90%, and as recently as 1979 it was 70%. In moving the nation back past the New Deal, conservatives would probably be happy with the income tax rate of 7% that was in place in 1913.
And conservatives want government to be less intrusive in people’s lives, except when it comes to hot-button issues of importance to them, such as a woman’s right to choose and same-sex marriage. This really has to do with religious beliefs and government should not be involved in regulating these areas. However, many conservatives would like the wall between government and religion to be torn down and for policy to be concordant with religious practices. Perhaps they would feel more comfortable in the Massachusetts’ colony in the 17^th century, when religion and government walked hand in hand, controlling people’s lives.
Conservatives also do not think contraceptive coverage should be an expected part of health insurance since this could lead (God forbid) to women’s sexual freedom and possibly sexual relationships outside of marriage. Better that America should go back past the 1960s, before oral contraceptives became widely accepted and state laws banning the sale and use of contraceptives were overturned by the Supreme Court. And conservatives believe a woman’s place is still in the home with the man as the breadwinner for the family, with no need for equal pay for equal work laws.

There’s also the “old West” model of society that conservatives promote; every citizen packing guns and standing their ground against whomever they see as miscreants. There’s no acknowledging the danger of weapons in an overwhelmingly urban nation and that weapons should be limited to hunting, sport shooting or home protection.

Their rejection of scientific information take us back in time as well, with an unwillingness to accept evolution, the “big bang” theory or global warming, and a desire to teach non-science in the classroom.
In addition, conservatives are suspicious of America being corrupted by foreign influences. This may be one of the reasons for their adamant opposition to sensible immigration reform, besides the economic grounds and possible racism. The overwhelmingly WASP nation that existed around the time of the revolution would probably fit the bill for them.

Unfortunately, the Supreme Court is currently dominated by conservatives who hold many of the above views and would like to take America back to a simpler and more freewheeling time of robber barons and gunslingers.

If conservative ideology becomes more ascendant in the future, America will indeed be returned to a previous era, its stature in the world eroded, economic inequality heightened, and the gains women have made rolled back. Perhaps if the electorate truly understood how conservative policies would change the nation, America might remain in the present with a brighter future.

Resurrecting Democracy
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The Big Game- Can America Compete?

                        Robert A. Levine   4-16-12

As an avid sports fan who follows teams on a college and professional level, I find the skewed priorities favoring sports over education for allocation of resources by state and local governments disturbing. Support for sports teams at high schools and colleges has continued or expanded even as school funding has dwindled, with coaches and athletic programs as the tails wagging the educational dogs. With March Madness having just passed, it’s appropriate to ask whether America will be able to participate in the “big game” of national economic competitiveness in future years, since contending is dependant on an educated populace.

There is little question that America does a poor job of educating its citizens compared to other nations. The Program for International Student Assessment in 2009 had the U.S. at 17^th in reading proficiency, 31^st in math and 23^rd in science. Instructors estimate that over 40% of college freshmen are unprepared for course work. Equally disheartening, employers say that 39% of applicants are not qualified for entry level jobs.

Yet despite the above deficiencies, funding for teachers’ salaries, additional teachers and facility upgrades is being curtailed throughout the nation. Admittedly, there are many reasons why America’s students perform poorly, including a lack of parental interest, poor teaching, language barriers, cultural mindsets, and so forth. And while increased funding is not the only answer to improve student performance, better teachers, more teachers and better facilities, all requiring increased funding, would certainly help.

On the other hand, money is being spent freely on athletic programs at many high schools and colleges. Texas is emblematic of the support given athletics while education is being starved. In the NEA rankings in December 2010, Texas was 33^rd in teacher salaries and 44^th in per student spending in K-12 schools. State testing (SERI) in science and mathematics in 2011 had Texas students 31^st. In the percentage of state populations over age twenty-five with at least a high school education, Texas came in last. Yet a new football stadium for Allen, Texas, high school last year was built at a cost of $60 million. The new stadium seats 18,000 people, replacing one that held 14,200. In 2006, high school football coaches in Texas averaged $73,800 in salary, versus $42,400 for teachers. And it isn’t only coaches and stadiums that athletic programs require, but assistant coaches, administrative personnel, training and weight rooms, and so forth.

On a university level, Texas football coach Mack Brown was the highest paid in America in 2010, earning $5.1 million plus incentives. This was while a pay freeze was in place at the university and tuition was being increased. While other Texas coaches earned less, they were still well paid compared to professors at their institutions.

The focus on sports in Texas is mirrored in other states with poor educational achievement. In Alabama, the head football coach currently has a guaranteed salary of $44 million over eight years, while full time faculty members will earn an average of $650,000 during this same period. In other words, the coach will be paid over sixty-six times the annual salary of faculty members. Another report showed that between 1985 and 2010, average salaries for professors at public universities around the nation rose 32% while those of football coaches went up 650%. This sends a message to students and faculty that they are not valued and that athletics is more important than education. Indeed, athletic prowess rather than academics is the way many universities brand themselves.

In general, states that most strongly embrace school sports are the ones that fare worst academically. Supporters of university sports programs argue that they bring in money and provide positive publicity for the school. And indeed that’s the case for some institutions that consistently have winning records in the major sports. But not every university can be a winner and there are far more that lose money on athletics than those that are profitable. And building athletic powerhouses on a high school level makes no sense at all.

To prepare America for the “big game,” the culture at high schools and universities must be changed, with more focus on academics and less on sports. Consideration might be given to having sports teams separated from the schools and run as independent clubs with school affiliations. Having an Ivy League-like de-emphasis on athletics is another option. Sports-rabid alumni, however, are unlikely to agree to these kinds of changes.

America is in competition with nations where students are willing to put in long hours of study, and academic proficiency is lauded. Sports are fun but need to play second fiddle to academics if America is to thrive in the 21^st century’s “big game.”

Resurrecting Democracy
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Freedom of Religion Is Not Absolute

               Robert A. Levine   4-12--12

 Rick Santorum made separation of church and state an issue in his campaign for the presidency, denouncing John F. Kennedy’s commitment to that principle and using freedom of religion as a rallying cry. The uproar regarding coverage for contraception further highlighted the continuing schism in America over those wanting absolute freedom to follow their religious beliefs and those accepting that when a conflict exists, civil law must override religious precepts.

Previous court battles have affirmed that freedom of religion in America is not an absolute right. Though the First Amendment to the Constitution prohibits Congress from any actions favoring the establishment of a religion or “prohibiting the free exercise thereof,” there have been a number of instances where the general welfare has taken precedence over religious practices, forcing a religion to change its edicts. Since the state is responsible for regulating harmful conduct, if there is disagreement between a religion and the state over some element of religious practices, civil law must be observed. Of course, the difficulty arises in determining which religious practices may be detrimental to society.

One prominent example of a conflict between church and state, where the Supreme Court ruled that civil law must be followed, involved the Mormon practice of polygamy. In 1862, the Morrill Act was passed by Congress prohibiting plural marriages. The Court upheld the conviction of a Mormon in 1878 for violating the law which he said had interfered with his religious duty. However, polygamy continued to be openly practiced by Mormons with the argument that it was protected by the First Amendment. Finally, in 1890, the president of the Mormon Church acknowledged that civil law had primacy over church law and the practice of polygamy was ended by the church, aside from some fundamentalist splinter groups. Similarly, the Muslim practice of allowing up to four wives under Islamic law is illegal in the U.S.

Another area where civil law was in dispute with religious officials was over the handling of pedophilia by the Catholic Church. For most of the 20^th century (and past centuries) the church dealt with child molestation by priests as a sin, rather than as a criminal offense. When a case of pedophilia was discovered, the name of the perpetrator was generally not reported to the civil authorities, with disciplinary measures meted out by the church. Often, this consisted of transfer to another position where the perpetrator might still have contact with children. Or a life of prayer and penance might be ordered. It was only after a series of scandals, numerous suits and some criminal trials in recent decades that the church agreed to treat pedophilia as a criminal offense, allowing an arm of the state to decide on punishment.

It is clear that religious freedom is not absolute in America. However, two questions must be answered by the courts in dealing with conflicts between church and state. One is how egregious the issue in contention is to the beliefs of a particular religion and the second is whether favoring the religion would contravene the general good to a sufficient degree to harm society. On the issue of contraception, it is clear that women’s health will be impacted if coverage is not available for low-income recipients. It also seems that when the Obama administration allowed church-affiliated organizations to opt out if they so desired and have the insurance companies pay for contraception, the church’s objections had been met.

We live in a pluralistic society where conflicts between what are considered civil rights or social needs and religious beliefs are constantly playing out. Finding a middle ground when dealing with galvanizing issues, such as abortion or same-sex marriage appears to be nearly impossible. On the other hand, the availability of contraception for all women seemed to have been settled decades ago and yet has come back to haunt us again. It is unfortunate that when the nation faces so many serious economic problems, the two political parties must devote so much time and energy to an issue like contraception coverage which should have been a minor administrative decision.

To truly insure freedom of religion for everyone, the wall separating church and state must remain in place as a bedrock principle of American democracy.

Resurrecting Democracy
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To Cut Health Care Costs, Unnecessary Care Must Be Targeted

                                                                        Robert A. Levine   4-9-12

Until the Supreme Court makes a decision about the legality of the Affordable Care Act (ACA) and its provisions, health care is in limbo regarding legislation that might be enacted to control health care costs and provide care to the uninsured. However, the health of the economy and federal government demand that these costs be controlled.

Recent recommendations by physician panels that doctors reduce the frequency of commonly used tests and procedures because they are often unnecessary reinforces the importance of attacking unnecessary care as a way to constrain costs. This advisory was issued by the American Board of Internal Medicine Foundation. The president of the organization, Dr. Christine K. Cassel asserted that the uninsured would be able to get coverage without any increase in government spending and that rationing of care would not be required if only appropriate care was provided.

An article in the Archives of Internal Medicine last September reported that many physicians believed their own patients were receiving too much care. The Congressional Budget Office and a number of analysts have placed the amount of unnecessary care at about 30% of health care expenditures, or $900 billion out of a total of $2.7 trillion; a considerable saving waiting to be harvested.
While politicians have spoken about broad cuts to Medicare and Medicaid to shrink the nation’s budget deficits, they have not mentioned targeting unnecessary care as a way to lower overall health care costs. They do not want to antagonize the powerful stakeholders in the health care system who would suffer financially by legislation having this objective. These stakeholders include organized medicine, insurance companies, trial lawyers, pharmaceutical companies and hospitals.

To reduce unnecessary care, physicians’ incentives to order or perform tests and procedures must be eliminated, and the rationale for defensive medicine must be ended. The paths to achieve both of these goals are clear, but the obstacles in the way require heavy lifting on the part of Congress if they are to be removed.

In order to curb defensive medicine, the ordering of unnecessary tests and procedures by physicians to protect themselves against malpractice suits, malpractice reform is needed. Trial lawyers, who are major contributors to the Democratic Party, are strongly opposed to any major changes in the malpractice process. The current system, which does not work effectively for either patients or physicians, greatly benefits these trial lawyers. Peer panels to review cases before suits can go forward should be required, with their analysis allowed to be introduced at any trials. Caps on the amounts given to injured patients for pain and suffering should also be legislated.

Even more significant in reducing unnecessary care would be ending the incentives physicians have to perform excessive tests and procedures which help determine their incomes. This means finding an alternative paradigm in order to end the fee-for-service payments that drive unnecessary care. Other methods that could be employed include bundling of payments for particular services, capitation, or having physicians on salary. Over 30% are doctors are already on salary and as I’ve mentioned previously, I favor this course as being the simplest one to implement. There are many ways this could be done. It works for the Kaiser system, Cleveland and Mayo Clinics, and there’s no reason why it can’t be successful when applied broadly. Physician salaries could also be augmented related to their productivity, patient satisfaction and quality of care.

Overall health care costs are skyrocketing. Federal budget deficits are partially due to increased spending on Medicare and Medicaid. Curtailing unnecessary care is an obvious way to bring costs under control and reduce the budget deficits and national debt while putting more money into the more productive parts of the economy. Getting it done in the current Washington environment is another story.

Resurrecting Democracy
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After the A.C.A.- Are There Answers?

                       Robert A. Levine  4-2-12

If the Affordable Care Act (ACA) is overturned by the Supreme Court, which now seems probable, how can health care costs be controlled and care provided to the one sixth of Americans who have no insurance? A bipartisan solution to the problem appears to be impossible. Evidence for this is reinforced by the fact that the individual mandate provision of the ACA, which originally had been a conservative Republican concept, became an anathema to Republicans once it had been adopted by Obama and the Democrats, and a focus of their opposition to the law.

Addressing the significant problems of overall health care costs, the one sixth of Americans who have no coverage, and increased spending by the government for Medicare and Medicaid, appears to be beyond the gridlocked, highly-partisan legislative bodies in Washington. And unless solutions to these problems are found, budget deficits and the national debt will continue to grow and the American economy will suffer. If after the November election one party controls the presidency and both Houses of Congress, with a filibuster proof majority in the Senate, there would at least be the possibility that a health care plan could be enacted. However, a more likely scenario is a continued division of the seats of power between the two parties and continued disagreement over what should be done. And cutting Medicare and Medicaid spending as the Republicans propose, or raising a few premiums, is not the answer.

The general animus between the parties and over health care in particular, masks the fact that the steps to constraining health care costs are straightforward and fairly obvious. However, it would entail abandoning the rigid insistence by conservatives on market-based solutions for all economic problems.

The market simply does not work in regard to health care, encouraging predatory behavior among the stakeholders in the system. When physicians are paid by fee-for-service, their income is determined by how many tests and procedures they perform and the intensity of the services they provide. And since there is an asymmetry of knowledge between laymen and physicians, patients usually accept whatever physicians recommend. This has led to a huge volume of unnecessary care; up to 30% of health care spending- $900 billion out of $2.7 trillion last year, with some adverse events as well. (Some unnecessary care is also generated by defensive medicine to ward off malpractice suits.)

Another 15-25% of health care spending is consumed by administration and overhead because of the complexity and inefficiencies of the insurance based system. Unable to reduce health care costs, insurance companies merely pass onto consumers in premiums whatever they pay out to providers. These companies also don’t cover those with pre-existing conditions and withhold payment for services whenever possible, to increase profits that will enhance executive salaries and shareholder dividends.

To curb unnecessary care, and save a good portion of the $900 billion dollars annually wasted there, fee-for-service payment for physicians should be eliminated. Capitation, bundling of payments for services, or having physicians on salary are all preferable options. Over 30% of physicians are already salaried and this would be the simplest and most efficient method of curtailing unnecessary care and its attendant costs.

A single payer system to reduce administration and overhead would also save hundreds of billions of dollars. This could be established through a Medicare for all system under the aegis of the government, or under a quasi-governmental agency similar to the Federal Reserve and free of political interference. Unfortunately, the chances of having this sensible path followed in the current political environment are slim to none.

Malpractice reform, expensive new technology that provides few benefits, and drug costs, must also be addressed to maximize savings for the health care system.

America’s per capita spending on health care is 50% higher than other developed countries. In terms of metrics like life expectancy and infant mortality, the medical outcomes are worse, and one sixth of Americans have no health care coverage. The nation can do much better in terms of cost and quality. The problems of soaring health care costs and lack of coverage have been ongoing problems for decades and need to be solved once and for all. Labeling necessary reform measures as “socialistic” and trying to placate the stakeholders in the current system will not help the nation find solutions. Pragmatism needs to win out over partisanship for America to win the battle over health care costs.

Resurrecting Democracy
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Beware of What You Wish For- Big Business and the Republican Congress

           Robert A. Levine  3-29-12

 In the realm of beware of what you ask for…was the desire of Big Business and its lobbyists, including the Chamber of Commerce, to elect a Republican Congress in 2010, providing millions of dollars that went to support GOP candidates. According to a New York Times article, “the return on investment has not always met expectations.” (http://nyti.ms/Hm2k9s) This may be somewhat of an understatement.

 Instead of pursuing legislation that would aid American businesses, enhance economic growth and reduce unemployment, Republican members of Congress have blocked these measures despite the fact they’re supported by corporate lobbyists and pro-business groups. The recalcitrance of these Republican members of Congress stems from their desire to reduce all government spending and cut the size of government. The two measures currently in limbo that businesses would love to see enacted are the transportation bill and authorization for the Export-Import Bank. The virulently anti-tax group, the Club for Growth, whose more appropriate name should be the Club for Stagnation, is opposed to this legislation, and many Republican members of Congress are taking their cues from them. A spokesman for this organization noted “Free market is not always the same as pro-business.”

 Though a ninety day extension of the highway transportation trust may be enacted by the House shortly, businesses say that long-term funding is required to start new infrastructure projects that would boost employment and the economy. It is possible that 1.5 million construction workers may be laid off unless funding is authorized. Collection of gasoline taxes would also be stopped, $110 million daily, the money probably going to the oil companies, never to be collected by the government. Speaker Boehner had previously promoted a $260 billion five year bill which was blocked by the Republican caucus and the Senate has already passed a version of the bill with bipartisan support. Currently, the federal government funds transportation spending to the tune of $51 billion annually, with each billion responsible for 30,000 jobs.

 The Export-Import Bank lends money to foreign entities to purchase American products and has been an important factor in American sales abroad since 1934, its charter due to lapse in May. U.S. exports have been thriving during the economic recovery. However, American goods would be at a competitive disadvantage without Export-Import Bank financing as other countries are willing to provide this kind of backing for their exporters. The Club for Growth opposes the Bank as an anomaly in the free market system, wanting lending to be a private function and unwilling to support the Bank as a necessity when other countries employ their funds to undermine our exporters. Rigid ideologues can not fathom pragmatic solutions to problems, dealing only in absolutes. The president of the National Association of Manufacturers, who contributed significant sums to Republican candidates in the last election cycle, had harsh words for opponents of the Bank, but these may fall on deaf ears.

Whether the extreme right-wing conservatives will eventually relent and support these two bills in the House remains to be seen. The American economy will lose if they do not, with both business and workers suffering.

Resurrecting Democracy
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