Relevant and even prescient commentary on news, politics and the economy.

What is Wrong with “Our” VA

This was an answer in the local Weekly Reader to a couple of others who insisted VA healthcare should be disassembled and handed over to the private sector. I guess I could have said “nuts; I did say “nonsense.”

“All right, they’re on our left, they’re on our right, they’re in front of us, they’re behind us…they can’t get away this time.” You figure out who said this.

Senator Bernie Sanders bill failed by 4 Republican votes to get out of the Senate. Within that bill there were several sections dealing with meeting the needs of veterans.

Section 327 would require VA to develop and transmit to Congress a strategic plan for improving access and quality of health care services for veterans in rural areas. This plan would include goals and objectives for: the recruitment and retention of health care personnel in rural areas; ensuring timeliness and improving quality in the delivery of health care services in rural areas through contract and fee-basis providers; implementation, expansion, and enhanced use of telemedicine services; ensuring the full and effective use of mobile outpatient clinics.

Section 501 would direct VA to reorganize the Veterans Health Administration (VHA) into geographically defined VISNs. In addition, it directs the Secretary to ensure that each VISN provides high quality health care to veterans, increases efficiency in care delivery, implements best practices, enhances collaboration with partner entities, among other management functions. Finally, this section requires the Secretary, at least every three years, to review and assess VISN structure and operations and submit review results to the Committees on Veterans’ Affairs.

Section 502 would require VA to establish not more than four regional support centers within VHA to assess how effectively and efficiently each VISN conducts outreach to veterans who served in contingency operations; administers programs for the benefits of women veterans; manages programs that address homelessness among veterans, and consumes energy. In addition, the regional support centers would assess the quality of work performed within finance operations, compliance related activities and such other matters concerning the operation and activities of each VISN as the Secretary considers appropriate. “Comprehensive Veterans Health and Benefits and Military Retirement Pay Restoration Act of 2014″

Here is what some of those needed four Republican Senators said:

“I don’t think our veterans want their program to be enhanced if every penny of the money to enhance those programs is added to the debt of the United States of America,” Senator Jeff Sessions Republican Alabama.

“Greatly expanded spending without any realistic offset,” as he dickered with Reid over sanctions on Iran. Republican Senator Mitch McConnell, Kentucky

“I think the decision we got here, as we debate this legislation, is whether we are going to commit to a promise that is bigger than what our kids can fulfill.”It costs more than our kids can afford (with a little sh*t-eating grin on his face). My colleagues pointed out most of the veteran organizations support this bill in fact correct. Senator Richard Burr Republican North Carolina

As far as the bill, the chairman has offered here, this bill has already been debated and there are problems with this bill that is an extensive piece of legislation that has many good elements in it. It also has a cost issue at a time when our nation owes $18 trillion and that was the reason why so may on my side of the aisle objected to it and that is why I would object as to the motion made here today by the Senator from Vermont.” Republican Senator Mario Rubio, FLA.

After causing Senator Bernie Sander’s bill to fail by 4 votes, these same 4 Senators are now trying to get to the bottom of why there are delays in getting care for veterans. The VA has always had a degree of issues with it in waiting for the benefits offered and this has been the case for decades. Too often and too late much of the delay is the result of the lack of funding to meet the influx of newly discharged and veterans (disabled and healthy). The issue extends to the Vietnam Veterans who are now arriving at the VA installations with issues resulting from age. Old Mr. Invincible has seen a few instances of physical vulnerability.

To answer to the insistence on leaving Veteran healthcare to the free market, we pretty much have done so with everyday people over the decades. What have we experienced?

- Since the proposal of Hillarycare in the nineties, we have seen the cost of providing healthcare quadruple. There are no controls or incentives to stem the persistent and ever-increasing cost of healthcare by the industry as it is a service- for- fees- cost- model, which makes it money by selling you more. The US has one of the most expensive healthcare systems in the world without the benefit of the best care globally.

- We have left the training of doctors and the supply of them to the free market. Increasingly we are experiencing a shortage of primary care doctors not only at the VA; but, it is being experienced in the private healthcare market today. Only 20% of the students hoping to be doctors are going into primary care and the shortage is growing. “The US is short ~16,000 Primary-Care Doctors. The PPACA attempts to solve the problem by skewing funding and salary to primary care except Congress is cutting PPACA funding “Congress, for example, already has chopped about $6.25 billion from the ACA’s new $15 billion Prevention and Public Health Fund, which pays for programs to reduce obesity, stop smoking and otherwise promote good health. In addition, federal support for training all types of physicians, including primary care doctors, is targeted for cuts by President Obama and Congress, Republicans and Democrats, says Christiane Mitchell, director of federal affairs for the Association of American Medical Colleges, who calls the proposed cuts “catastrophic.” Nurse Practitioners are coming on line; but, the time table is long and they will not be abundant for years yet Some of this is a contrived shortage as cited by PNHP:

“(Nursing schools are trying to produce more Nurse Practitioners (NPs) to deal with the crisis in primary care, but have been consistently attacked by MDs who insist that NPs are not well enough educated to provide even routine primary care.)” “Lack of funding is the Real VA scandal”

- Try getting in to see a Cardiologist or specialist or primary care doctor in 2-3 weeks in the commercial market. You can not and the wait times extend outward from 1-3 months in private medical care clinics (my experience). This is typical. Phillip Longman the author of The Best Care Anywhere most recently pointed to the wait for a private clinic doctor’s appointment.

patients who already have good private insurance have trouble scoring an appointment with a primary care physician. Which is why, (Philip Longman interview at Vox) , wait times for an appointment in Los Angeles are on average up to 59 days and in Boston up to 63. Newspaper reports like that in the New York Times spotlight vets who have been able to get immediate appointments in the private sector.

Well I congratulate them.

Most people I know, even those with good health insurance have a pretty hard time finding a PCP whose practice is even open to new patients and have to wait a good long time for specialist care as well. How will the nation’s overtaxed primary care doctors suddenly be able to accommodate millions of vets when they can’t handle the patients they already have, plus the influx of patients who will now be insured thanks to the Affordable Care Act?”

And the acting VA Chief is planning on dumping thousands of veterans into the commercial market? The placing of Veterans in the commercial market will start an erosion of VA benefits for those who have earned it serving the “4 chicken-hawks” I named above who sent them to war.

- The VA offers more to veterans than what the private healthcare clinics can. As one Livingston Daily Veteran (Jim Pratt) pointed out: “The VA system has major advantages over private hospitals in some things- such as electronic medical records, coordinated care, and early screening and detection of issues that of are particular need for military veterans. U of M medical center does not screen for PTSD, or for titanium dust (Camp Victory), depleted uranium exposure (All our engagements since the 1980′s), or exposure to ionizing radiation. The VA can do those, and more.

Another veteran, Jack Samples points to the efforts of the Ann Arbor VA in handling its patient workload. Having been there myself, I can vouch for it also. Guarantees two-week maximum waits for primary care appointments, Provides 24-hour emergency care, provides daily urgent care for anyone who does not have an appointment but needs or wants to see a doctor, etc.

- VA Primary Care doctors are underpaid and making less than their commercial counterparts do. It is difficult to attract more primary care doctors to the VA when more can be made in commercial hospitals.

The list goes on, on how Congress has failed the veterans of this nation with some lame excuses for not funding the last two wars and preparing adequately to receive veterans. Much of this is not the fault of the VA. The generalities expressed by two readers do not hold up to a close examination and there is no economic reason to give veteran healthcare over to a failed private healthcare system which abandoned millions of people.

“The Architect of the VA’s Quality Transformation Under Clinton Speaks Out”, Phillip Longman

“VA Care: Still the Best Care Anywhere? Part II”, Phillip Longman

“How to Beat the Doctor Shortage”, Marsha Mercer

“The Best Care Anywhere”, Phillip Longman

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The Short Version–Piketty

June’s issue of Atlantic Monthly brings to the reader a series of graphs as presented by Derek Thompson’s “How the Rich Shall Inherit the Earth”. The article gives a pictorial representation of what has taken place since the eighties in skewing income to a small, very small group of individuals numbering < than a hundred thousand taxpaying households. The bulk of the ~1 % are much like the 99% and make their income mostly from wages. It is the 1% of the 1% who have excelled in making their money from investments and inheritances.

There are quite a few discussions going on at various blogs as to whether r > g or not and whether it is a fundamental law of capitalism/economics. Side comment; FIFA governs soccer games utilizing the laws of the game which are open to interpretation by various referees monitoring the game. Laws are not rules and are open to interpretation. Courts also give interpretations of laws, which can be superseded by higher courts. When various district federal courts disagree, SCOTUS can and may make an interpretation. There does not appear to be such a governing body in economics the same as FIFA or SCOTUS..

This one comment by Yves Smith caught my eye as it does ring true:

“What I’m bothered by is that the ‘fauxgressives’ are flogging Piketty, when I don’t see his argument as helpful to the left. If you believe r > g, then large and rising wealth disparity is a state of nature. You have handed the argument over to conservatives, who will contend that you have to interfere in a very basic way in the operations of capitalism to undo that.”

In my opinion, this result is not a natural state of being and it is the result of manipulation. In a series of charts, Thompson has captured what Piketty has said in 700 pages(?) and the result of the skewing of income to a minority of taxpaying households.

- Since the late seventies, income growth among the top 1 percent of Americans has outpaced the income growth of the other 99%. In further examining the 1%, it is the top 1% of the 1% which has experienced the greatest growth.

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- Thompson poses the question; Who are these people? and answers his own question “amongst the top 0.1 percent half work in finance or as corporate executives. They are people compensated directly or in­directly by the growth of the stock market in various forms other than payroll wages. In the past 30 years, CEOs at top firms have been paid more and more with stock.”

CEO Compensation

- Adding to his earlier comment; “the richer you are, the more likely it is that your wealth came from stocks and not income from payroll wages. Most people want to believe they are capable of achieving great wealth resulting from their labor and the wages paid for it. Wages resulting from Labor “are less relevant to earnings at the top of the income pyramid”.

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“The above chart compares the inflation-adjusted incomes of the top 0.1 percent with annual inflation-adjusted S&P 500 prices, both indexed to 100 beginning in 1913. (Note: The income numbers for the 0.1 percent come from Picketty and Saez. The real S&P prices come from Robert Shiller).”

- The importance of those various factors to the increase of 3.6 percentage points in the Gini index for total market income between 2002 and 2007 differs yet again. More than 80% of the total increase in the Gini index over those years stemmed from an increase in the share of total income coming from more highly concentrated capital gains. An increase in the concentration of capital income accounts for most of the remaining increase. Labor income became somewhat less concentrated over that period, but the effect on overall income dispersion was small.” Page 12-13, Trends in the Distribution of Household Income Between 1979 and 2007

Gini

- ‘The top 1% of US households, own 38.2% of all US stock market wealth and the richest 10% of households own a combined 81.2% of all the stock market wealth, whilst the bottom 60% of US households only own 2.5% of stock market wealth.’”

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Taken from: Economic Policy Institute, “‘The State of Working America 2011, Share of Stock Holdings Held by Top 10% Has Barely Budged in Last Two Decades.’ Includes direct ownership of stock shares and indirect ownership through mutual funds, trusts, IRAs, Keogh plans, 401(k) plans, and other retirement accounts.

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Quelle Surprise, Labor Productivity is Up while Labor Wages are Still Down!

BLS economist Shawn Sprague writes What Can Labor Productivity Tell Us About the U.S. Economy?

Labor worked the exact same number of hours in 1998 as they did in 2013 or ~194 billion hours. While there was no growth in the number of hours worked, the Non-Institutional Civilian Population grew by 40 million people, and new businesses were created by the thousands which should have needed more Labor. Mean while American businesses produced $3.5 trillion in goods or 42 percent more in 2013 than in 1998 even after adjusting for inflation.

To repeat, during this period “the Business sector output grew by 42 percent, Labor hours did not grow at all, and Labor productivity (the difference in these growth rates) grew by 42 percent.” Sprague explains further; “if labor hours had grown instead by 10 percent during the period, then labor productivity would have grown by 10 percent less, or 32 percent. If labor hours had instead grown by a full 42 percent, then labor productivity would not have grown at all during the period. These examples illustrate that it is the interplay of output growth and labor hours growth that is fundamentally important to understanding labor productivity.” Labor hours of input did not grown, so what happened?

 

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Increases in throughput (as I would call it) can be achieved through more efficient equipment; faster, experienced or trained Labor; less down time for maintenance, utilization improvements, and less scrap or better materials. “In these and other cases, output may be increased without increasing the number of labor hours used.” I am gong to assume this could mean the addition of more Labor without adding hours.

Here we have a situation of increased business gained through efficiency and the resulting Productivity Gains not going to Labor and remaining with Capital. Shawn Sprague does not really delve into this topic; but, it is apparent within some of the earlier posts by Spencer England Labor’s Share, others as well, and Shawn’s footnote 4. Isn’t this a part of what Piketty is pointing out in his narrative on the growth of inequality?

Shawn’s Footnote 4: While this is possible, it is not always the case that growth in labor income keeps pace with growth in labor productivity. For instance, over the past 30 years, gains in real worker compensation per hour have fallen behind gains in output per hour. This reveals another reason why it is important to measure labor productivity—because it is the yardstick with which we can measure the extent to which additional production per hour of work ultimately ends up translating into additional income per hour of work. More on the topic: The compensation-productivity gap: a visual essay

There is no reason for business to hire more Labor to meet the increased business or shorten the work week to accommodate more workers as it would tighten the Labor Market and increase Overhead and Labor Wages. Best of both worlds for business, increased profits and a loose Labor market.

Hat Tip: Economists View

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The War on Private Citizens and Organizations Feeding the Homeless

It has been the political right’s mantra of welfare and charity being best done by private organizations rather than be government sponsored. 50 years have passed since President Johnson declared war on poverty. It was declared an abject failure by the right as it did not make people independent nor did it make people want to get off of welfare. Accordingly, it could be only be through private organizations and then the poor would be able to succeed past welfare. One NBC article written not that long ago focused on a couple feeding the poor once a week in a park in Florida .  The police ticketed the Jimenez, his wife and others for violating a local ordinance on feeding the poor in a restricted park area. The Jimenezs refused to pay the fines levied against them, the fines were ultimately forgiven by the Daytona police, and Jimenez was warned.

 

In  a follow-up article, “Food Feud: More Cities Block Meal-Sharing for Homeless; it was learned “33 cities have either adopted or are considering food–sharing restrictions. Raleigh, N.C.; Myrtle Beach, S.C.; Birmingham, Ala.; and Daytona Beach, Fla.;  have recently fined, removed, or threatened to jail private groups offering meals to the homeless instead of letting government-run service agencies care for those in need.” The idea of restricting food to the poor is the same as with wild animals; if you do not feed them, the poor will not come around looking for handouts and your neighborhood will remain untouched.

 

Volusia County where Daytona Beach resides called on an expert to consult with the authorities on how to resolve the problem with the poor. Robert Marbut, a national homeless consultant does not believe in locking up priests, ministers, and groups helping the poor. Nor does he believe in ordinances criminalizing the helping or feeding of the poor. Marbut does believe in “24/7 programs that treat the three root causes of homelessness – a lack of jobs, mental illnesses and chronic substance abuse – have been shown to reduce local homeless populations by 80 percent” and not just feeding the poor. Doesn’t this sound a little bit familiar and it would appear we are coming full circle on localities, states, and federal government helping the poor if only it was funded. As stated by Marbut, It is only with a combination of approaches can the poor find the means of breaking the poverty barrier once they have gotten this far in life. Of course the ultimate would be to provide the education and help before the poor ever became adults; but then, there is the little problem of Milliken vs. Bradley getting in the way of better schools and economics in cities. 

 

People are more comfortable with a group of weapon-toting people wandering into a restaurant to express their 2nd amendment right to bear arms than with having the poor around them. John Adams once noted about the poor. “The poor man’s conscience is clear . . . he does not feel guilty and has no reason to . . . yet, he is ashamed. Mankind takes no notice of him. He rambles unheeded. In the midst of a crowd; at a church; in the market . . . he is in as much obscurity as he would be in a garret or a cellar. He is not disapproved, censured, or reproached; he is not seen . . . To be wholly overlooked, and to know it, are intolerable.”  It is to a life of obscurity in which many people would push the poor.

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Thanks, But We Still Hate Obamacare!

Greg Sargent gets a great nugget from Democratic pollster Celinda Lake, who “recently conducted a statewide poll in Kentucky for an unnamed client and found that Kynect polls very positively, in contrast to Obamacare, which is underwater.”

Kynect is the Kentucky version of the Affordable Care Act exchange. To the extent the polling is correct, these results are another example of people loving the ACA but hating Obamacare.

 

Which just isn’t very surprising. People still don’t really know what “Obamacare” is. Why should they? There’s nothing labeled “Obamacare” that anyone has to deal with; almost nothing labeled “Affordable Care Act;” and there aren’t even all that many noticeable parts of the new system. Of course, Kynect is one of those new things, but there’s no reason for anyone in Kentucky to know that it has anything to do with the national law.

 

Hat Tip: Jonathan Berstein Thanks, But We Still Hate Obamacare!, Jonathan Bernstein

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“The US Labor Market is Not Working;” Antonio Fatas “On the Global Front”

This particular post was first picked up at Economist’s View and fits with Sandwichman’s posts on Labor. I have been watching Participation Rate in conjunction with U3 since 2001 along with others such as Laurent Guerby and while the US has decreased in the numbers of people in the Civilian Labor Force, our counterparts in Europe have seen increased numbers in the Civilian Labor Force. Krugman makes a statement “even the French Work harder than the Americans” which to me is rather bizarre given the French have a shorter work week and more time off than the American Labor Force. Perhaps it has nothing to do with working harder? We might find the reasons for an increased Civilian Labor Force in working smarter and more efficiently during a shorter work week. I think Krugman and the proponents of the 40+ hour work week tend to forget, it is all about throughput and efficiency and not about Labor as the latter can allow greater Labor participation. I find the comparison of the US to other countries interesting in that the other countries and associated appear to allow the citizenry to be more productive than the US by keeping more of them employed and working shorter hours. Maybe in the US we are just too militant for higher wages and time off???

Anyhoo, here the post by Antonio Fatas as taken from his blog “On The Global Front.” Antonio is certainly qualified to make such an analysis as he is on the Portuguese Council Chaired Professor of European Studies and Professor of Economics at INSEAD. INSEAD is a business school with campuses in Singapore and Fontainebleau (France). Antonio is a Senior Policy Scholar at the Center for Business and Public Policy at the McDonough School of Business (Georgetown University, USA) and a Research Fellow at the Center for Economic Policy Research (London, UK). His charts certainly provoke discussion as to what we in the US “are doing wrong.”

 

“In a recent post Paul Krugman looks at the dismal performance of US labor markets over the last decade. To make his point, he compares the employment to population ratio for all individuals aged 25-54 for the US and France. The punch line: even the French work harder than the Americans! And this is indeed a new phenomenon, it was not like that 13 years ago [Just to be clear, there are other dimensions where the French are not working as hard: they retire earlier, they take longer vacations,... but the behavior of the 25-54 year old population is indeed a strong indicator of how a society engages its citizens in the labor market. ]

So are the French the exception? Not quite. Among OECD economies, the US stands towards the bottom of the table when it comes to employment to population ratio for this cohort (#24 out of 34 countries).

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What is interesting is that most of the countries of the top of the list are countries with a large welfare state and very high taxes (including on labor). So the negative correlation between the welfare state and taxes and the ability to motivate people to work (and create jobs) that some bring back all the time does not seem to be present in the data.

What is interesting is that the US looked much better 13 years ago (see numbers for 2000 below, the US was 10 out of 34).

The US has gone through a major crisis after 2008 with devastating effects on the labor market but so have other countries. In fact, most European countries have done much worse than the US in terms of GDP growth during the last 6 years. In fact, with the exception of Portugal, Greece and Ireland, the US is the country with the worst labor market record for this age group if we compare the 2012 to the 2000 figures.”

Hat Tip to: Economists View

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Polk County Arkansas 9th Street Ministries Medical Mission Clinic is Closing

Polk County, Arkansas 9th Street Ministries will be closing its medical clinic mission April 24, 2014. It has been in place since 1998 offering free medical services to those who did not have Medicare, Medicaid or commercial insurance. The reason for its closure has nothing to do with finances or lack of support although I imagine it was difficult during the Great Recession to raise funding.

“‘Because people are qualifying for insurance coverage through the Affordable Care Act, also known as Obamacare, our free medical clinic will not be needed anymore,’ Stacey Bowser RN, 9th Street Ministries Clinic Director, stated. ‘We’ve gone from seeing around 300 people a month on a regular basis, but as people were enrolling in Obamacare, the numbers we were seeing have dropped. We were down to 80 people that came through the medical clinic in February, all the way down to three people at the medical clinic in March. Our services won’t be needed anymore, and this will conclude our mission.’”

The clinic was offering medical assistance to first come first served the last Thursday of every month. You think it is difficult to get an appointment when you have insurance? Just imagine waiting a month at a time if you have a chronic illness?

But this closure of the 9th Street Ministries Medical Mission Clinic can not be true, the numbers as cited by the Rand study and Charles Gaba are highly inaccurate according to some at Angry Bear disputing the numbers of who have signed up through he state and federal exchanges or through commercial companies.

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References: Crooks and Liars; Here’s The Best Obamacare Story Yet; The Menastar; 9th Street Ministries to conclude Medical Clinic mission; and Charles Gaba’s Blog

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How Many of Obamacare’s New Enrollees Were Uninsured Last Year? Why It Doesn’t Matter

Maggie Mahar on the Uninsured:

As I explain in an earlier post, Charles Gaba, the enrollment guru who has been tracking Obamacare sign-ups since October, now estimates that by April 15, some 17 million Americans will have purchased their own insurance policies either in the Obamacare Exchanges (8 million) or off-Exchange (9 million)

But how many of them were uninsured and how many were simply replacing policies that the Affordable Care Act (ACA) had forced insurers to cancel?  This is the question conservatives ask.  After all they argue, if most of these folks already had coverage, we have just wasted a great deal of time and money moving them from a policy they chose to one that President Obama prefers.

There are two answers to their question. The first is that while we don’t have an exact number as to how many of the new enrollees were uninsured,we do know (thanks to Obamcare),  the percent of Americans who are “going naked” has declined.

Gaba offers a second, even better, answer: “It doesn’t really matter.”

I agree. As he explains:

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Obamacare Enrollment Heads for 17 million

by Maggie Mahar at The Health Beat Blog.

Charles Gaba, who has become the “Nate Silver” for Obamacare enrollment numbers; now predicts that by April 15, 17 million Americans will have purchased their own healthcare coverage.

His back-of-the-envelope estimate includes a nice round 8 million”  who buy policies in the government marketplaces. In parentheses, he suggests:  Perhaps a little higher (1M even?) and then strikes that thought;  “As always,” he notes, “I’ll be more than happy to be proven wrong, as long as I’ve undershot the mark.”

Gaba then adds roughly  9 million who, (according to a Rand Corp. survey), have bought their own policiesdirectly from insurers, instead of using the Exchanges. Nine million plus 8 million brings us to an astounding number: 17 million.

Rand shared its analysis  with the LA. Times, though it has not yet released its report. Obamcare’s  skeptics scoff at Rand’s number; but, Gaba points out the Blue Cross and Blue Shield Association alone have confirmed its member plans have enrolled at least 1.7 million people in plans that  meet the ACA’s requirements outside the exchange system.

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