Archive for the ‘Business’ Category
A very interesting (and somewhat lengthy) article on the turbulent changes in North Dakota from the boom.
Veronika Scott is the 24-year-old CEO and founder of Detroit-based nonprofit, The Empowerment Plan, which employs and trains homeless women to become full-time seamstresses who make a coat that turns into a sleeping bag at night and a bag during the day. Funded by donations from foundations, companies, and individuals, The Empowerment Plan is headquartered at Ponyride and has been featured by the New York Times, NPR, The Discovery Channel, The Today Show, and more.
By all means read the interview at the link. This is a person who knows how to put aside your preconceptions and to develop her approach from what she learned by observing and listening—and also looking for ways to improve her entire approach. A wonderful article.
This article is totally amazing—and it gets more so as it goes.
The stock markets are rigged, part MMDCCCLXIV: Half of Futures Trades in Chicago Are Illegal Wash Trades
Read and ponder. The regulations and laws and watchdog agencies are failing.
And we do little to prevent it: like many American failures, it is simply accepted as part of “having the best healthcare system in the world.” Marshall Allen reports in Pacific Standard:
The health care community is not doing enough to track and prevent widespread harm to patients, and preventable deaths and injuries in hospitals and other settings will continue unless Congress takes action, medical experts said last week on Capitol Hill.
“Our collective action in patient safety pales in comparison to the magnitude of the problem,” said Dr. Peter Pronovost, senior vice president for patient safety and quality at Johns Hopkins Medicine. “We need to say that harm is preventable and not tolerable.”
Dr. Ashish Jha, a professor at the Harvard School of Public Health, said patients are no better protected now than they were 15 years ago, when a landmark Institute of Medicine report set off alarms about deaths due to medical errors and prompted calls for reform.
“We can’t continue to have unsafe medical care be a regular part of the way we do business in health care,” Jha said.
One of the biggest problems, the experts told the Senate Subcommittee on Primary Health and Aging, is that providers and public health agencies still are not accurately measuring the harm.
Senator Bernie Sanders (I-Vermont), the panel’s chairman, said afterward that most patients probably don’t know that preventable patient harm is the third-leading cause of death in America. He said the problem hasn’t received the attention it deserves in the public arena or from lawmakers.
Jha said it is crucial to develop better metrics to produce credible data about harm that is valid and credible. Without data, providers don’t know how they’re doing or if quality improvement efforts are working, he said.
Pronovost and Jha called for requiring the Centers for Disease Control and Prevention, which already collects data about hospital-acquired infections, to begin tracking other patient harms.
Dr. Tejal Gandhi, president of the National Patient Safety Foundation, said studies show that medication errors, adverse drug events, and injuries due to drugs occur in up to 25 percent of patients within 30 days of being prescribed a drug.
Missed and delayed diagnosis is also a problem, and a primary cause of malpractice lawsuits in the outpatient setting, she said. Systems need to be put in place to monitor patient care instead of simply relying on doctors to get it right, Gandhi said.
“We cannot just tell clinicians to try harder and think better,” Gandhi said.
The title of the hearing, “More Than 1,000 Preventable Deaths a Day Is Too Many: The Need to Improve Patient Safety,” was inspired by . . .
The FDA isn’t doing its job because it’s almost totally in thrall to the businesses that it is supposed to regulate and seems mostly to do their bidding. And, given the GOP pressures, I imagine funding has been cut. But still, for a Federal judge to explicitly rule that the FDA doesn’t have to do its job to protect the public makes one throw up his hands.
There are plenty of conclusions you can draw from this, but one of the key ones is that it demonstrates that corporate boards are almost completely unable to predict how well CEO candidates will do on the job. They insist endlessly that they’re looking for only the very top candidates—with pay packages to match—and I don’t doubt that they sincerely think this is what they’re doing. In fact, though, they don’t have a clue who will do better. They could be hiring much cheaper leaders and would probably get about the same performance.
One reason that CEO pay has skyrocketed is that boards compete with each other for candidates who seem to be the best, but don’t realize that it’s all a chimera. They have no idea.
Jeff Horowitz reports at The Big Story:
The Consumer Financial Protection Bureau has heard from hundreds of thousands of consumers who feel wronged by banks and finance companies. Now the agency wants the public to hear from those consumers too.
On Wednesday, the bureau proposed allowing consumers to publish online the details of their complaints against lenders and financial service providers. Those narratives would augment the bureau’s consumer complaint database, which lists complaints about checking accounts, credit cards, student loans and other financial products. If consumers choose to make their complaints public, the companies involved would then be given a chance to write a public response.
“By proposing to share people’s stories, we are giving consumers an opportunity to be heard by the entire world and not simply by a government agency and its officials,” CFPB Director Richard Cordray said in remarks prepared for a Thursday event in El Paso, Texas.
The consumer bureau’s current database simply lists the company being complained about, a general subject matter like “deposits and withdrawals,” and whether the complaint has been resolved. By adding the narratives, the bureau believes it will help consumers determine where to take their business and identify systemic problems. A similar complaint reporting system is already in place at the Consumer Product Safety Commission, which seeks to identify dangerous products from appliances to toys.
Consumer groups were elated by the bureau’s proposal, which Ruth Susswein, a deputy director at Consumer Action, called “essential for consumers to protect themselves.” Banks have complained bitterly about . . .
This is excellent news—indeed, the complaints from the banks show how good it is. And as we saw in the previous article, making Federal databases open to the public whenever possible can help mitigate fraud and bad practice.
The simple answer is that Medicare was not reviewing its billing data and seemed to have little interest in stopping fraud. Charles Ornstein reports in ProPublica:
A few years ago, Illinois’ Medicaid program for the poor noticed some odd trends in its billings for group psychotherapy sessions.
Nursing home residents were being taken several times a week to off-site locations, and Medicaid was picking up the tab for both the services and the transportation.
And then there was this: The sessions were often being performed by obstetrician/gynecologists, oncologists and urologists — “people who didn’t have any training really in psychiatry,” Medicaid director Theresa Eagleson recalled.
So Medicaid began cracking down, and spending plummeted after new rules were implemented. In July 2012 the program stopped paying for group psychotherapy altogether for residents of nursing homes.
Yet Illinois doctors are still billing the federal Medicare program for large numbers of the same services, a ProPublica analysis of federal data shows.
Medicare paid Illinois providers for more than 290,000 group psychotherapy sessions in 2012 — more than twice as many sessions as were reimbursed to providers in New York, the state with the second-highest total.
Among the highest billers for group psychotherapy in Illinois were three ob/gyns and a thoracic surgeon. The four combined for 37,864 sessions that year, more than the total for all providers in the state of California. They were reimbursed more than $730,000 by Medicare in 2012 just for psychotherapy sessions, according to an analysis of a separate Medicare data set released in April.
“That’s not good,” Eagleson said when told of the Medicare numbers.
Medicare’s recent data release has led to a string of analyses showing how waste and fraud is inflating the nation’s bill for health care. This work has echoed the findings of ProPublica’s investigation last year into Medicare’s prescription drug program known as Part D, which had fewer barriers to waste and fraud than other government health care programs – and was making less effective use of its own data.
Of the Illinois ob/gyns billing for group psychotherapy, . . .
Some of these physicians should face criminal charges for fraud and also lose their license to practice medicine.
Pam Martens reports at Wall Street on Parade:
Only one word comes to mind to describe the testimony taking place before the U.S. Senate’s Permanent Subcommittee on Investigations this morning: Machiavellian.
The criminal minds on Wall Street have twisted banking and securities laws into such a pretzel of hubris that neither Congress, Federal Regulators or even the General Accountability Office can say with any confidence if the U.S. financial system is an over-leveraged house of cards. They just don’t know.
According to a copious report released last evening, here’s what hedge funds have been doing for more than a decade with the intimate involvement of global banks: the hedge fund makes a deposit of cash into an account at the bank which has been established so that the hedge fund can engage in high frequency trading of stocks. The account is not in the hedge fund’s name but in the bank’s name. The bank then deposits $9 for every one dollar the hedge fund deposits into the same account. Some times, the leverage reaches as high as 20 to 1.
The hedge fund proceeds to trade the hell out of the account, generating tens of thousands of trades a day using their own high frequency trading program and algorithms. Many of the trades last no more than minutes. The bank charges the hedge fund fees for the trade executions and interest on the money loaned.
Based on a written side agreement, preposterously called a “basket option,” the hedge fund will collect all the profits made in the account in the bank’s name after a year or longer and then characterize millions of trades which were held for less than a year, many for just minutes, as long-term capital gains (which by law require a holding period of a year or longer). Long term capital gains are taxed at almost half the tax rate of the top rate on short term gains.
There are so many banking crimes embedded in this story that it’s hard to know where to begin. Let’s start with the one most dangerous to the safety and soundness of banks: extension of margin credit.
Under Federal law known as Regulation T, it is perceived wisdom on Wall Street that a bank or broker-dealer cannot extend more than 50 percent margin on a stock account. But since the banks involved in these basket options called these accounts their own proprietary trading accounts, even though the hedge fund had full control over the trading and ultimate ownership of profits, the banks were justified (in their minds) with thumbing their nose at a bedrock of doing business on Wall Street.
We learn from a footnote in the Senate’s report that hedge funds have gamed Regulation T further. The report . . .
I blogged earlier on Andrew Cuomo, who increasingly seems to be corrupt, and his relationship with Howard Glaser. Nicole Bronzan has a brief article in ProPublica—and there’s a podcast at the link:
Justin Elliott (@JustinElliott) was doing his poking around a year ago when he uncovered a story he hadn’t even known existed, he tells Assistant Managing Editor Eric Umansky (@ericuman) in this week’s podcast.
Looking into the relationship between Howard Glaser, a mortgage industry lobbyist, and Andrew Cuomo, now New York’s governor, he filed a Freedom of Information request for Glaser’s emails in that capacity. The state denied the request, citing Glaser’s role as a consultant in Cuomo’s investigation into the mortgage industry during his time as attorney general — a previously unreported fact.
It was a surprising twist on the revolving door between government and industry, Elliott says: “Howard Glaser was on both sides of that door at the same time, and not only that, at least two of the companies that Andrew Cuomo was investigating as attorney general were actually acknowledged clients of Glaser.”
Umansky takes a moment to “savor the deliciousness” of that turn of events. “In the course of objecting to and fighting our open records request,” he says, “their argument for that actually turned out to be revealing another story to us.”
In the end, one of Glaser’s clients ended up getting immunity, Elliott says, which may have made sense for the investigation, but it’s never been reported that Cuomo ever used any information obtained as part of the deal with the due diligence firm Clayton. “It’s not clear why this deal was made,” he says.
Meanwhile, Glaser had a prominent role in news reports about Cuomo’s investigations, including the story that broke the news of the 2007 deal with Clayton, Elliott says– but without mention of his role consulting for the attorney general’s office. “If you read the New York Times story, which we link to in our story, who’s quoted in it? None other than Howard Glaser, as a mortgage consultant,” he says. “Story doesn’t mention the fact that Glaser had worked for both Clayton and Cuomo.”
Asked for answers about all this, Glaser instead began a Twitter campaign against ProPublica and its founding funder weeks before the article was published, Elliott says.
That “prebuttal” of the story actually worked against him in the end, Umansky says, calling it one of the “great moments in PR management.” In response to Glaser’s tweets, “a number of reporters started tweeting about their interest in seeing what the story was.”
By publishing time, ProPublica’s publicity team already had a head start, thanks to Glaser.
You credit card numbers and expiration dates sent (and stored) without encryption, for example. See this article at Ars Technica by Cyrus Farivar. From the article:
. . . Hasbrouck pointed out that the more information the airlines choose to retain, the more of an opportunity the government has to build a profile on me. “They have seat assignments [and] could probably search who is seated next to you for social network analysis,” he said. “You have no way of knowing when you’re using this website which information they are storing.”
“This is not to catch people under suspicion; this is for the purpose of finding new suspects,” Hasbrouck added.
I asked Travelocity about its practices and received a statement from Keith Nowak, a company spokesman.
“As the ticketing agents to the airlines, travel agencies like Travelocity routinely provide ticketing and other relevant passenger data to the airlines to help facilitate passenger flight requests,” he said, declining to answer further specific questions. “Once this data has been transferred, the airlines use the data for appropriate operational purposes, and the airlines determine how and when the data may be shared with other parties. As a partner in this process, Travelocity consistently complies with all relevant data privacy and data security requirements.”
He declined to respond to how or why my credit card number was transmitted in the clear.
Fred Cate, a law professor at Indiana University, said that my story raises a lot of questions about what the government is doing.
“Why isn’t the government complying with even the most basic cybersecurity standards?” Cate said. “Storing and transmitting credit card numbers without encryption has been found by the Federal Trade Commission to be so obviously dangerous as to be ‘unfair’ to the public. Why do transportation security officials not comply with even these most basic standards?”
The goal of PNR collection, according to CBP, is “to enable CBP to make accurate, comprehensive decisions about which passengers require additional inspection at the port of entry based on law enforcement and other information.”
This information is retained for quite some time in government databases. CBP publicly states that PNR data is typically kept for five years before being moved to “dormant, non-operational status.” But in my case, my earliest PNR goes back to March 2005. A CBP spokesperson was unable to explain this discrepancy. . .
A somewhat depressing article in Mother Jones by Tom Philpott.
He cites many studies, but the EPA so far has shown little or no interest.
Missouri is the only state that refuses to create a prescription drug database to detect and prevent prescription drug abuse. The reasons seem to be a refusal to be shown. The NY Times story by Alan Schwarz begins:
On his office phone at L & S Pharmacy, Richard Logan listened as a doctor’s office detailed how a patient had just left with her third prescription for painkillers in only nine days — and was quite possibly getting more, illegally, elsewhere.
Mr. Logan, 61, holstered two guns, slipped on a bulletproof vest and jumped into his truck. Because in his small corner of America’s epidemic of prescription drug abuse, Mr. Logan is no ordinary pharmacist. He is also a sheriff’s deputy who, when alerted to someone acquiring fraudulent drug prescriptions, goes out to catch that person himself.
“I’m only one guy, and for every person we get to, there are probably 100 who we can’t,” Mr. Logan said. “How many people have to get addicted and die for us to do what everyone else is doing about it?”
Continue reading the main story
His frustration stems from this: Missouri is the only state in America that has declined to keep a prescription drug database — the primary tool the other 49 states use to identify people who acquire excess prescriptions for addictive painkillers and tranquilizers, as well as the physicians who overprescribe them.
Not having the database has not only hampered Missouri’s ability to combat prescription drug abuse, but also attracted people from neighboring states looking to stockpile pills and bring them home to take themselves or sell to others, according to law enforcement officials, legislators and data compiled by a prescription drug processing firm.
“Welcome to Missouri — America’s Drugstore,” said Dr. Douglas Char, an emergency room physician in St. Louis. “We aren’t just allowing abuse, we’ve created a business model for dealers.”
Drug monitoring programs, whose procedures and powers can vary significantly from state to state, all share a similar strategy: to require doctors, pharmacists or both to enter all prescriptions into a database that can — or, in some states, must — be consulted later to make sure patients do not get excess medication.
Because many states’ programs appear effective, Missouri has been urged to put one into effect. Among those calling for a change are Missouri medical associations, members of Congress from neighboring states, the White House and even Mallinckrodt Pharmaceuticals, the St. Louis-based manufacturer of oxycodone, the highly abused prescription painkiller.
But while proponents say the vast majority of the Legislature supports the measure, it has been blocked by . . .
Very interesting incident, well reported: Denver Police harassing Uber driver (and passenger as well). Being able to use a smartphone to do research on the spot (not to mention the camera and video capabilities) certainly changes the nature of interactions with police.
It will take a while to figure out best practices, and that is why we try to preserve cultural knowledge—i.e., things painfully and slowly worked out. I sound like I’m becoming a conservative.
A meme evolving. In the Washington Post Linda Bernardi has a good rundown of the current sources of venture funding, which has moved far beyond the venture capitalists.
Over the last decade the venture capital and funding market has changed dramatically. Whereas in the past venture capitalists were the go-to-guys in the playground, there are new players giving entrepreneurs with many choices. One used to focus their efforts in the famed VC offices on Sand Hill Road, but today it is happening in every corner and coffee shop around the world.
Here are nine of the new entrants into the funding game:
1. Corporations making equity investments in start-ups. These are generally strategic investments and can have potentially huge upsides. Often a precursor for an intended acquisition and could mean a large investment, but the corporation is not interested in leading the round. They are generally passive investors and not on boards.
2. Corporate venture funds. With billions of dollars in reserves, companies are very well equipped to make large venture investments. Most large companies have very large VC operations, i.e. Intel Venture Capital, which has billions of dollars invested in start-ups and larger companies, and runs as a lucrative venture firm. Other companies with major venture operations include Google, Samsung, and many others. This assures a seat at the table for the large corporations and close involvement in innovation.
3. . .
Very interesting article in the NY Review of Books by Tim Parks:
Is there any consistent relationship between a book’s quality and its sales? Or again between the press and critics’ response to a work and its sales? Are these relationships stable over time or do they change?
Raise your hand, for example, if you know what the actual sales are for Karl Ove Knausgaard’s My Struggle. This mammoth work of autobiography—presently running at three five-hundred-page volumes with three more still to be translated from his native Norwegian—is relentlessly talked about as an “international sensation and bestseller” (Amazon) and constantly praised by the most prestigious critics. “It’s unbelievable… It’s completely blown my mind,” says Zadie Smith. “Intense and vital…. Ceaselessly compelling…. Superb,” agrees James Wood. Important newspapers (The New York Times for one) carry frequent articles about Knausgaard and his work. A search on The Guardian website has ten pages of hits for articles on Knausgaard despite the fact that his work wasn’t published in the UK until 2012. In a round-up of authors’ summer-reading tips in the same newspaper, the academic Sarah Churchwell remarks that after sitting on the jury for the Booker prize she looks forward to being “the last reader in Britain” to tackle My Struggle.
One could be forgiven, then, for imagining that this is one of those books which periodically impose themselves as “required reading” at a global level: Umberto Eco’s Name of the Rose, Jostein Gaardner’s Sophie’s World, Peter Hoeg’s Smilla’s Sense of Snow, Jonathan Franzen’s Freedom all spring to mind, literary equivalents of internationally successful genre works like Stieg Larssen’s The Girl with the Dragon Tattoo, Dan Brown’s The Da Vinci Code, and E. L. James’s Fifty Shades of Grey.
Well, as of a few days ago UK sales of all three volumes of Knausgaard work in hardback and paperback had barely topped 22,000 copies. A respectable but hardly impressive performance. In the US, which has a much larger market, that figure— total sales of all three volumes (minus e-books)—stood at about 32,000. This was despite the fact that with Knausgaard’s growing reputation the powerful Farrar, Straus and Giroux stepped in to buy the paperback rights from the minnow Archipelago and bring its own commercial muscle to bear. On the Amazon bestsellers ranking, A Death in the Family, the first and most successful volume of the My Struggle series, is presently 657th in the USA and 698th in the UK, this despite a low paperback price of around ten dollars.
So what is going on here? Should we be reassured that critics are sticking loyally by a work they admire regardless of sales, or bemused that something is being presented as a runaway commercial success when in fact it isn’t? Wouldn’t it be enough to praise Knausgaard without trying to create the impression that there is a huge international following behind the book? Or do the critics actually assume that everyone is buying it because they and all their peers are talking about it?
The truth is . . .
Perhaps GMO foods are not so benign after all—particularly if the genetic modification was to allow the food crop to survive being sprayed and coated with highly toxic herbicides, such as Roundup. Oliver Tickell reports in The Ecologist:
A scientific study that identified serious health impacts on rats fed on ‘Roundup ready’ GMO maize has been republished following its controversial retraction under strong commercial pressure. Now regulators must respond and review GMO and agro-chemical licenses, and licensing procedures.
A highly controversial paper by Prof Gilles-Eric Séralini and colleagues has been republished after a stringent peer review process.
The chronic toxicity study examines the health impacts on rats of eating a commercialized genetically modified (GM) maize, Monsanto’s NK603 glyphosate-based herbicide Roundup.
The original study, published in Food and Chemical Toxicology (FCT) in September 2012, found severe liver and kidney damage and hormonal disturbances in rats fed the GM maize and low levels of Roundup that are below those permitted in drinking water in the EU.
However it was retracted by the editor-in-chief of the Journal in November 2013 after a sustained campaign of criticism and defamation by pro-GMO scientists.
Toxic effects were found from the GM maize tested alone, as well as from Roundup tested alone and together with the maize. Additional unexpected findings were higher rates of large tumours and mortality in most treatment groups.
Criticisms addressed in the new version
Now the study has been republished by Environmental Sciences Europe. The republished version contains extra material addressing criticisms of the original publication.
The raw data underlying the study’s findings are also published – unlike the raw data for the industry studies that underlie regulatory approvals of Roundup, which are kept secret. However, the new paper presents the same results as before and the conclusions are unchanged.
The republication restores the study to the peer-reviewed literature so that it can be consulted and built upon by other scientists.
The republished study is accompanied by . . .
Monsanto will fight this to the bitter end. Monsanto really doesn’t care whether the foods are damaging to the body; Monsanto is striving purely to make sure profits grow.
Another very interesting article in Pacific Standard (and again, right now in Firefox you have to scroll past several screens of links), this one by Nicole Woo:
The Nation recently sparked a robust discussion with its incisive online conversation, “Does Feminism Have a Class Problem?” The panelists addressed the “Lean In” phenomenon, articulating how and why Sheryl Sandberg’s focus on self-improvement—rather than structural barriers and collective action to overcome them—angered quite a few feminists on the left.
While women of different economic backgrounds face many different realities, they also share similar work-life balance struggles. In that vein, the discussants argue that expanding family-friendly workplace policies—which would improve the lives of working women up and down the economic ladder—could help bridge the feminist class divide.
A growing body of research indicates that there are few other interventions that improve the economic prospects and work-life balance of women workers as much as unions do. A new report from the Center for Economic and Policy Research (CEPR), which I co-authored with my colleagues Janelle Jones and John Schmitt, shows just how much of a boost unions give to working women’s pay, benefits, and workplace flexibility.
For example, all else being equal, women in unions earn an average of 13 percent—that’s about $2.50 per hour—more than their non-union counterparts. In other words, unionization can raise a woman’s pay as much as a full year of college does. Unions also help move us closer to equal pay: A study by the National Women’s Law Center determined that the gender pay gap for union workers is only half of what it is for those not in unions.
Unionized careers tend to come with better health and retirement benefits, too. CEPR finds that women in unions are 36 percent more likely to have health insurance through their jobs—and a whopping 53 percent more likely to participate in an employer-sponsored retirement plan.
Unions also support working women at those crucial times when they need time off to care for themselves or their families. Union workplaces are 16 percent more likely to allow medical leave and 21 percent more likely to offer paid sick leave. Companies with unionized employees are also 22 percent more likely to allow parental leave, 12 percent more likely to offer pregnancy leave, and 19 percent more likely to let their workers take time off to care for sick family members.
Women make up almost half of the union workforce and are on track to be in the majority by 2025. As women are overrepresented in the low-wage jobs that are being created in this precarious economy—they are 56.4 percent of low-wage workers and over half of fast food workers—unions are leading and supporting many of the campaigns to improve their situations. In an important sense, the union movement already is a women’s movement.
Education and skills can get women only so far. It’s a conundrum that women have surpassed men when it comes to formal schooling, yet women have made little progress catching up on pay. Many women who do everything right—getting more education and skills—still find themselves with low wages and no benefits. . . .