Later On

A blog written for those whose interests more or less match mine.

Archive for July 10th, 2009

A pattern emerges

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The lead paragraph of this interesting article gives an example:

Campaigning for president, Barack Obama said repeatedly that any overhaul of the health care system should be negotiated publicly and televised for all to see. Throughout this year’s negotiations, however, the big deals have been struck in secret.

The whole article is worth reading, but I was struck by how often one can write about something that Barack Obama promised repeatedly while campaigning (DADT repeal, DOM repeal, cramdown supported, voting against telecom immunity, and on and on) and then ignored now that he’s in office. It’s a bad thing to practice, hollow promises.

Written by LeisureGuy

10 July 2009 at 5:35 pm

The public plan is good—and saves a lot of money

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Jonathan Cohn, who knows healthcare, writes:

A lot of conservative Democrats, not to mention Republicans, express two big concerns about health reform. They’re worried that reform will cost too much. And they don’t want a government-run insurance plan.

It’s about to get a lot harder to make those two arguments simultaneously.

According to a pair of Capitol Hill sources, preliminary estimates from the Congressional Budget Office suggest that a strong public option–the kind that the House of Representatives is putting in its reform bill–should net somewhere in the neighborhood of $150 billion in savings over ten years.

The sources cautioned that these were only the preliminary estimates, based on previous discussions–that CBO had not yet issued final scoring on language in the actual bill. But the sources felt the final estimate would likely be close.

Exactly how the plan produces those savings is, obviously, a key question. The reason–well, a reason–centrists and conservatives don’t like a public plan is that they fear it will use the government’s bargaining leverage to force doctors, hospitals, and drugmakers to accept unfairly low reimbursements. Private insurance would go out of business, since they couldn’t compete; meanwhile, providers and producers of medical care would struggle to stay afloat.

Advocates of a public plan (myself included) think those fears are overblown–and that there are ways to make sure a public plan doesn’t have that effect. But if the CBO is scoring significant savings, then chances are the House version gives the public plan the kinds of power conservatives and centrists fear.

But, for now, the bigger story is the number. At a time when finding the $1 trillion it will take to finance coverage expansions remains the major challenge of reform, the discovery of $150 billion in potential savings is an important–and encouraging–piece of news.

Written by LeisureGuy

10 July 2009 at 4:02 pm

GOP still blaming CRA for the housing crisis

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One reason the GOP seems to embody stupidity is that the party seems unable to learn and even to process factual material. The canard that the Community Reinvestment Act caused the housing problems in the economy requires that one totally ignore the incredible increase in subprime loans, the securitization of those loans, and the credit default swaps to protect that securitization: all done by private industry, which the GOP fervently believes can do no wrong.

Mike Lillis in the Washington Independent:

Worth noting from yesterday’s House Judicial subcommittee hearing on the foreclosure crisis: Republicans just can’t shake the temptation to blame the Community Reinvestment Act for causing the current economic turmoil.

You’ve heard the critics’ argument before: The CRA hasn’t so much empowered low-income borrowers as it has lowered lending standards, thus forcing banks to make the bad loans that led to the crisis.

Rep. Trent Franks (R-Ariz.), the subpanel’s senior Republican, summed up the sentiment nicely Thursday when he claimed the downturn was caused not by predatory lenders preying on people, but by a predatory government preying on banks for political ends.

Never mind that no less an authority than the Federal Reserve’s director of consumer and community affairs said the CRA was “not one of the causes of the current crisis.” Instead, the Fed found that CRA-covered banks were responsible for just 6 percent of the risky, high-cost loans that sparked the financial wildfire.

Franks’ comments weren’t overlooked by Rep. William Delahunt (D-Mass.), who used most of his Q&A time debunking the myth, picking from witnesses statistics like those reported by the Fed. Not that he imagined the Republicans were listening.

“When you’re looking for whipping boys,” Delahunt said, “the CRA is just a prime target.”

The GOP didn’t listen because the GOP is fundamentally opposed to learning, one reason they hate science.

Written by LeisureGuy

10 July 2009 at 3:55 pm

Posted in Daily life, GOP

The domestic surveillance report is out

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You can read the report here. Spencer Ackerman will be doing a series of posts on it. His first:

Last year, the Democratic Congress enthusiastically acquiesced to President George W. Bush’s insistence on carving out individualized suspicion and other privacy protections from the Foreign Intelligence Surveillance Act. The Democrats did so to preempt the charge of being weak on national security from the presidential campaign — didn’t work — and then-Sen. Barack Obama, who may have figured that selling out civil liberties was the better part of aspirational valor, voted for the bill. If there was any comfort to the civil libertarians, it was that what became the FISA Amendments Act of 2008 mandated that the inspectors general of the Departments of Defense, Justice, the Office of the Director of National Intelligence, the CIA and the National Security Agency had to launch a review of how the warrantless surveillance efforts actually worked, complete with an assessment of “legal reviews of the Program.” It was July 2008.

A year later, the report is complete, and I’ve just gotten a copy of it. What does it say? I’m still reading it, but one thing it says is that the CIA’s involvement in the program is deeper than has been reported. [Isn't the CIA forbidden by law to run operations in the US? – LG] And one interesting bonus fact: the report calls the program the “President’s Surveillance Program,” rather than the manipulative “Terrorist Surveillance Program” handle the Bush administration gave the program when it became public in order to put critics in a tight spot. (”What? You oppose surveillance for dangerous terrorists who want to kill your grandchildren????”)

More as I read the report.

Update: Here’s the basis for switching up the nomenclature, and it comes with a point of pride. Two years ago, in July 2007, Paul Kiel and I tried to make sense of then-Attorney General Alberto Gonzales’ congressional testimony about the “Terrorist Surveillance Program” and concluded that there must have been more than one secret surveillance program authorized by President Bush beginning in 2001. Today the IGs’ report bears us out: …

Continue reading. More in the series:

CIA Played a Leading Role in Warrantless Surveillance

Yoo and Only Yoo (Knew About Surveillance)

‘Most PSP Leads Were Determined Not to Have Any Connection to Terrorism’

Gonzales’ Testimony on Surveillance Was ‘Confusing, Inaccurate, and … Misleading’

Stuff That’s Missing From the Inspectors General Report on Warrantless Surveillance

Bush Personally Ordered Visit to Ashcroft’s Hospital Bed

Written by LeisureGuy

10 July 2009 at 3:39 pm

Paying for healthcare

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Karen Tumulty writes at TIME’s Swampland blog:

Whenever I talk to anyone at the White House about the difficulties they are having on Capitol Hill figuring out a way to pay for health reform, they remind me that the President Obama still has an idea on the table–one that has never been taken very seriously at the other end of Pennsylvania Avenue. His proposal is to put a 28% limit on the tax break for itemized deductions claimed by those making over $250,000. That’s about 20% less than they are allowed to claim now. It would have raised an estimated $318 billion over the next 10 years. But the opposition is formidable. Charities, for one, worry that this would dampen giving at a time when they need it most.

Alas, lawmakers aren’t having much luck coming up with something they like any better. Senator Max Baucus had hoped to raise roughly the same amount by taxing the most generous employer-provided health benefit plans–those costing $17,000 a year or more for a family–but that idea is running up against a lot of opposition from his fellow Democrats. However, that proposal polls badly, and would impose new taxes on a lot of middle-class people–firefighters, police, teachers, and others who have won generous health benefits as a result of collective bargaining. So Baucus has been sent back to the drawing board by Majority Leader Harry Reid.

Obama’s initial proposal had been pretty much left for dead by the legislative roadside, but all of a sudden, it’s back in the mix of options being mentioned as a way of making up the funding gap. And it was also endorsed this morning by the Oracle of Omaha (you can hear Warren Buffett talk about it late into the video).

Is this where things end up? I still wouldn’t bet on it. But it is looking more and more likely that the answer to funding the overhaul of health care will include some additional taxes aimed at the wealthy. In the House, for instance, the Ways and Means Committee is looking at an income tax surcharge. And one thing is clear: If legislators don’t figure out a way to make the math work in coming days, the whole question is likely to get kicked off until after the August recess.

Written by LeisureGuy

10 July 2009 at 3:03 pm

The overdraft scam delivers big bucks to banks

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Kevin Drum at Mother Jones:

Kathy Chu reports on the overdraft fee scam, which currently generates nearly $40 billion in income for banks — by far their most lucrative source of fees and penalties:

Some consultants offered banks ways to boost overdraft and credit card revenue. A 2001 "checklist" from Profit Technologies — a firm that has worked with 19 of the USA’s 20 largest banks — has more than 600 strategies….One strategy listed to boost overdrafts: "Allow consumers to overdraw their … accounts at the ATM up to the bank’s internally set limit." To increase credit card fees, banks can "delay crediting of payments not received in bank provided envelop (sic) or for which payment coupon is not received for up to 5 days," and "remove bar coding from remittance envelopes," slowing the payment.

….Has banks’ pursuit of profit gone too far? Ken Vollmer, 49, of Augusta, Ga., thinks so. He sued Wachovia this year, alleging it "purposely structured transactions to make money." A merchant mistakenly put a hold on his funds, then the bank cleared transactions from high to low, triggering hundreds in overdraft fees, he says. Spokeswoman Richele Messick says Wachovia processes transactions in an "appropriate" way and will "vigorously defend" itself in the case.

Banks clear larger payments first, says Talbott, because they tend to be more important. But Douglass Colbert, who advised banks on overdraft and card strategies at Profit Technologies, says fees are a key driver.

"Banks will say (high-to-low clearing) is for the consumer," he says. "Bottom line is, when it was pitched, we’d say … a side effect is that it results in more fee income to you because it bounces more checks." Colbert says that after leaving Profit Technologies, he joined a credit-counseling firm and saw the damage fees did to consumers.

Just to make this clear: Say you have $100 in your checking account and four checks arrive at your bank in the following amounts: $15, $20, $30, and $150.  If you clear them in that order, the first three are fine and only the last one incurs an overdraft.  If you clear them in the opposite order, all four incur overdraft fees.  Ka-ching!  That’s why banks like to clear high to low.

In any case, if our Congress had any balls they’d fix this in a trice: simply regulate overdrafts as short-term loans, which is what they are.  The interest rates would be high, but nowhere near as high as the effective 1000%+ that banks charge now.  And it wouldn’t matter what order checks cleared.

Banks still have to make money, of course, and if overdraft fees went down then the cost of other services would go up.  But that’s fine.  There’s no reason that overdraft fees from their least prosperous customers should subsidize other business lines.  It’s better to charge everyone fairly and openly rather than trying to make outsize profits on the banking industry’s poorest customers.

And the chances of this happening?  About zero.  Why?  Don’t be silly.  It’s because the finance industry still owns Congress.

Written by LeisureGuy

10 July 2009 at 3:00 pm

Healthcare industry adopts tobacco industry’s tactics

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Wendell Potter is a healthcare industry insider who is supporting healthcare reform. He writes:

At first look, one might not think that the health insurance industry has much in common with the tobacco industry. After all, one sells a product that kills people and the other sells a product nominally aimed at putting people back together. But when it comes to deceitful public relations techniques, the health insurance industry has been learning well from Big Tobacco, which employed a panoply of shady but highly successful public relations tactics to fend off changes to its business for generations.

One of the things I said in my testimony before the Senate Commerce Committee on June 24 is that the health insurance industry engages in duplicitous public relations campaigns to influence public opinion and the debate on health care reform. By that I mean there are campaigns they want you to you know about, and those they don’t.

When you hear insurance company executives talk about how much they support health care reform and can be counted on by the President and Congress to be there for them, that’s the campaign they want you to be aware of. I call it their PR charm offensive.

When you read or hear someone other than an insurance company executive — including members of Congress — trash some aspect of reform the industry doesn’t like, such as the creation of a public health insurance option, there’s a better-than-even chance that person is shilling for the industry. That’s the PR campaign the industry doesn’t want you to know about.

The public relations and lobbying firms that work for the industry plan and carry out those deception-based campaigns, and supply the shills with talking points. One of many tactics they use is to get people who are ideologically in sync with the industry’s agenda to turn those talking points into letters to the editor.

An example of a letter that contained many of the industry’s messages appeared in the June 27 edition of the New York Times...

Continue reading.

Written by LeisureGuy

10 July 2009 at 2:58 pm

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