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

The VA, Still The “Best Care Anywhere”

Today, “Economist’s View showcased Paul Krugman’s latest NYT article“Veterans and Zombies”. Paul discusses how the hyped-up VA issues are being used as an example of under performing government healthcare to emphasize how bad the much larger PPACA healthcare reform could be if allowed to proceed. Of course this is not true; but both Mark and Paul missed the data found by the most recent VA audit. The results of the audit were released June 9th. I left a long reply on the thread detailing the findings of the recent VA audit.

There is no comparison to be made of the VA healthcare to private healthcare. The VA is ahead of private healthcare and where private healthcare should be if it were going to improve. In a nutshell, the VA is well beyond the typical private healthcare system in providing “evidence-based protocols of care — not inadvertently ordering up dangerous combinations of drugs, or performing unnecessary surgeries and tests just to make a buck and treating the whole patient and not just one part at a time.” The services for fees cost model does not exist in VA healthcare for veterans.

If you remember, I had recently written “Wait Times at the VA” detailing what the recent Inspector General had discovered in the audit of the VA as reported June 9th “U.S. Department of Veterans Affairs VA Access Audit & Wait Times Fact Sheet System-Wide Overview”. Phillip Longman the author of the “Best Care Anywhere” featured the Inspector General’s report on the Washington Monthly “Just How Long Is The Wait”

“The nationwide Access Audit covered a total of 731 separate points of access, and involved over 3,772 interviews of clinical and administrative staff involved in the scheduling process at VA Medical Centers (VAMC), large Community Based Outpatient Clinics (CBOC) serving at least 10,000 Veterans and a sampling of smaller clinics.” Included in the finding were these issues:

– A complicated scheduling process resulted in confusion among scheduling clerks and front-line supervisors.
– A 14 day wait-time performance target for new appointments was not only inconsistently deployed throughout the health care system but was not
attainable given growing demand for services and lack of planning for resource requirements.
– Overall, 13% of scheduling staff interviewed indicated they received instruction (from supervisors or others) to enter a date different than what
the Veteran had requested.
– 8% of scheduling staff indicated they used alternatives to the official Electronic Wait List (EWL). In some cases, pressures were placed on
schedulers to utilize unofficial lists or engage in inappropriate practices.

Immediate Actions to Be taken as a result of the Audit:

– VA has accelerated care for Veterans currently waiting for health care services. VHA is in the process of contacting in excess of 90,000 Veterans
during the first phase of VA’s “Accelerating Access to Care Initiative.” The first phase is the first appointment.
– VHA will provide Veterans who do not currently have an appointment, or are waiting for additional care or services longer than 30 days the option
to be rescheduled sooner if VA capacity exists, keep their scheduled appointment, or be referred to non-VA providers in the community.
– VA has suspended all VHA Senior Executive Performance Awards for FY14
– VHA will remove 14-day performance goal from employee performance plans
– VHA will revise, enhance and deploy Scheduling Training
– VHA will implement a site inspection process.

What is so different about this if one were to compare the VA to private healthcare is, if the issue occurred in private healthcare nothing would have happened or reported to correct the issue. The VA had set up guidelines for scheduling people, a 14 day window, and a procedure to report on it. People created work-a-rounds to the procedures and processes to surpass the reporting and they got caught. The issue went public. Little if any of this reporting occurs in private healthcare, much less public reporting. Yet Congress and critics think that closing down the VA and turning veterans over to the private healthcare system is a benefit to veterans. It is not a benefit to veterans and is a detriment

Audit Findings: Long Term and Other Actions:

– VHA will overhaul the scheduling and access management directive.
– VHA will roll out near-term changes to the legacy scheduling system.
– VHA will acquire and deploy long-term scheduling software solutions.
– VHA will reassess and establish access timeliness goals.
– VHA will strengthen accountability for integrity in scheduling and access management.

The VA is implementing change to again take on scheduling of Veterans for appointments. That the VA even had a 14 day goal for appointments is far beyond what can be see in private healthcare except if one goes to the ER.

Wait Time Information

On May 15th, the VA had ~ 6 million appointments scheduled across its system. ~57,000 Veterans are waiting to be scheduled for care. ~ 63,000 veterans over the past ten years have enrolled in the VA healthcare system and have not been seen for an appointment. The VA is making contact with those who need scheduling and the new enrollees to clear up the backlog.

– Of the 6,004,350 total appointments scheduled, 96% of them or 5,763,291 appointment were made in 30 days or less.

– Conversely, 242,059 veterans or 4% of the 6,004,350 scheduled appointments were made after 30 days.

– The audit shows that even appointments at the Phoenix, AZ VA (the ground zero of the VA scandal), 89 percent of people enrolled in the system
received an appointment in less than 30 days. The average wait for established patients to see a primary care doc coming to just over 14 days.

– Most everywhere else in the VA system, average wait times for established patients to see a primary care doc are in the range of 2 to 4 days, as
are waiting times to receive specialty care.

Mind you, three months for a doctor’s visit is too long; but, it is not so out of the ordinary as what is being experienced in private healthcare today. The audit did reveal there are ~ 57,000 veterans who have waited for a doctor’s visit longer than 90 days and representing ~ 1% of the 6 million vets taken care of by the VA. Furthermore, there are ~ 63,000 veterans who are more-than-likely not the newly arrived veterans from Iraq/Afghanistan as claimed by CNN and the rest of the media. Much of this numeric can probably be explained by the relaxing of VA regulations on admission into VA care. Many Vietnam Veterans have reapplied to the VA with the idea we may be accepted. I would urge any veteran to apply as the regs do change as well as your income and you can be grandfathered even if the next president tightens the regulations as Bush did.

The VA is not flawless as many of veterans today know and I surely do. Of the 57,000 veterans waiting for an appointment, some veterans may have been forgotten by the VA, some may have moved to another city and missed the appointment, some may have gotten group insurance, and many may have enrolled immediately upon discharge to insure grandfathering and not need an appointment. This was the broad base upon which CNN made up its news story along with other media outlets and politicians with unsubstantiated data which is proving to be more hyperbole than fact.

Sending veterans to private healthcare after breaking up the VA is what CNN, the media, and the politician’s call a “benefit” bestowed upon Veterans. It is not a benefit and will only make healthcare treatment worse for veterans.

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Quelle Surprise, Wisconsin Governor Scott Walker Accused ???

If you have been watching the ongoing saga unfolding in Wisconsin on Governor Scott Walker and his recall election and election shenanigans, it probably comes as no surprise there was fire where there was smoke.

Prosecutors allege Gov. Scott Walker was at the center of an effort to illegally coordinate fund” raising among conservative groups to help his campaign and those of Republican state senators facing recall elections during 2011 and ’12, according to documents unsealed Thursday.

In the documents, prosecutors lay out what they call an extensive ‘criminal scheme’ to bypass state election laws by Walker, his campaign and two top Republican political operatives — R.J. Johnson and Deborah Jordahl. This marks the first time prosecutors have disclosed the details of their probe.”

Mind you, this did not happen in the last day or so. This has been an ongoing John Doe investigation in 2014 (and earlier) which Scott Walker and the Wisconsin Club for Growth have been attempting to quash. Wisconsin District Judge Randa agreed with Walker’s group and ordered all documentation destroyed. The case was appealed to the 7th District COA where Judge Easterbrook and two other judges over ruled Randa. “Federal Judge Rudolf Randa is a member of the Federalist Society and his wife donated often to Walkers campaign. Judge Randa’s Judicial Assistant is the wife of Scott Walkers lawyer.” Hey, its all in the family.

“Federal Appeals Judge Frank Easterbrook unsealed the court documents Thursday as he reviews a lawsuit attempting to end the John Doe probe. Two unnamed individuals this week tried to intervene in the case to prevent the release of the records, but Easterbrook rebuffed their request.” I wonder who that could be?

One alleged Scott Walker email with Karl Rove was released by Easterbrook in the ~250 pages.

“The documents include an excerpt from an email in which Walker tells Karl Rove, former top adviser to President George W. Bush, that Johnson would lead the coordination campaign. Johnson is also Walker’s longtime campaign strategist and the chief adviser to Wisconsin Club for Growth, a conservative group active in the recall elections.’

‘Bottom line: R.J. helps keep in place a team that is wildly successful in Wisconsin,” Walker wrote to Rove. “We are running 9 recall elections and it will be like running 9 Congressional markets in every market in the state (and Twin Cities.)'” No crime there yet; but, it is a smoking gun.

Walker and the Wisconsin Club for Growth are accusing the state prosecutors of violating their rights to freedom of speech due to the gathering of this information which reveals the names of donators to pro-Republican/Conservative funds. They accuse the prosecutors of violating the same elections laws they are accused of doing.

The 7th District COA with Judge Easterbrook as the chief judge of a panel of three is reviewing the case. Like Posner, Easterbrook is not so easily swayed by politics. It should get interesting.

References:
Prosecutors Allege Scott Walker At Center Of Campaign Finance Criminal Conspiracy, Huffington Post
John Doe prosecutors allege Scott Walker at center of ‘criminal scheme, Milwaukee Wisconsin Journal Sentinel

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Wait Times at the VA

Lead story at CNN was this:

Washington (CNN) — An internal Veterans Affairs audit released Monday said tens of thousands of newly returning veterans wait at least 90 days for medical care, while even more who signed up in the VA system over the past 10 years never got an immediate appointment they requested.

I have been following Phillip Longman, the author of “Best Care Anywhere” subtitled “Why VA Healthcare is Better than Yours” since he asked AB to review his book. Unfortunately, I did not have the time to do so. After talking to Maggie Mahar at Health Beat, she reviewed Phillip’s book A Salute to the VA on Memorial Day—Part 1. If you not had the chance to read the review, now is the time to do so. I would also recommend Phillip’s book for an understanding of how healthcare can improve and how the VA healthcare did improve to be superior to what private healthcare provides. In a nutshell, the VA is well beyond the typical private healthcare system in providing “evidence-based protocols of care — not inadvertently ordering up dangerous combinations of drugs, or performing unnecessary surgeries and tests just to make a buck and treating the whole patient and not just one part at a time.”

Yesterday, Phillip Longman presented the results of the VA audit Just how long are those wait times at the VA really? Remember CNN claims “Audit: More than 120,000 veterans waiting or never got care.”

– Of the 6,004,350 total appointments scheduled, 96% of them or 5,763,291 appointment were made in 30 days or less.

– Conversely, 242,059 veterans or 4% of the 6,004,350 scheduled appointments were made after 30 days

– The audit shows that even appointments at the Phoenix, AZ VA (the ground zero of the VA scandal), 89 percent of people enrolled in the system received an appointment in less than 30 days. The average wait for established patients to see a primary care doc coming to just over 14 days.

– Most everywhere else in the VA system, average wait times for established patients to see a primary care doc are in the range of 2 to 4 days, as are waiting times to receive specialty care.

Mind you, three months for a doctor’s visit is too long; but, it is not so out of the ordinary as what is being experienced in private healthcare today. The audit did reveal there are ~ 57,000 veterans who have waited for a doctor’s visit longer than 90 days and representing ~ 1% of the 6 million vets taken care of by the VA. Furthermore, these are more-than-likely not the newly arrived veterans from Iraq/Afghanistan as claimed by CNN and the rest of the media. Much of this numeric can probably be explained by the relaxing of VA regulations on admission into VA care. Many Vietnam Veterans have reapplied to the VA with the idea we may be accepted. I would urge any veteran to apply as the regs do change as well as your income and you can be grandfathered even if the next president tightens the regulations as Bush did.

The VA is not flawless as many of veterans today know and I surely do. Some veterans may have been forgotten by the VA, some may have moved to another city and missed the appointment, some may have gotten group insurance, and many may have enrolled immediately upon discharge to insure grandfathering and not need an appointment. This was the broad base upon which CNN, other media outlets, and politicians made their unsubstantiated claim which is proving to be more hyperbole than fact. Auditors did not find tens of thousands of veterans who have been waiting for up to ten years to get an appointment they requested. As Phillip explains, the audit U.S. Department of Veterans Affairs VA Access Audit & Wait Times Fact Sheet actually finds “there are 63,869 who over the past ten years have enrolled in our healthcare system and have not been seen for an appointment.” And this is CNNs, the medias, and the politician’s “benefit” bestowed upon Veterans from flawed coverage of the issue?

Reference:

Just how long are those wait times at the VA really?, Phillip Longman

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Interesting Virginia Primary Results Just Moments Ago

Novice Tea-bagger Representative candidate Dave Brat just handed Republican House Majority Leader Eric Cantor a defeat in the Virginia GOP primary. A $200,000 campaign fund challenging a 6-digit campaign fund. Apparently, Cantor was not backwards, conservative enough for the 7th District Tea-baggers.

“‘There needs to be a change,’ said Joe Mullins, who voted in Chesterfield County Tuesday. The engineering company employee said he has friends who tried to arrange town hall meetings with Cantor, who declined their invitations.”

“Brat has accused the House majority leader of being a top cheerleader for “amnesty” for immigrants in the U.S. illegally. Cantor has responded forcefully by boasting in mailers of blocking Senate plans ‘to give illegal aliens amnesty.'”

House Majority Leader Eric Cantor loses Virginia GOP primary, AP reports

The present atmosphere of The House has been one split three ways between Democrats, Republicans, and Tea-baggers. Almost nothing moves through The House having a progressive bend to it. If the Tea-baggers take a larger portion of the split, then the stance will be one of greater obstinacy. I am assuming this district will remain Republican or Tea-bagger even with the recent development.

It will be interesting to see if Cantor still runs and splits the Republican/Tea-bagger vote.

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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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