from American Thinker

March 10, 2010

Reconciliation and the Senate Bill

By Marilyn M. Barnewall

excerpt:

Using reconciliation to ram through complicated, far-reaching legislation is an abuse of the budget process.  The writers of the Budget Act, and I am one, never intended for reconciliation’s expedited procedures to be used this way. These procedures were narrowly tailored for deficit reduction. They were never intended to be used to pass tax cuts, or to create new Federal regimes. Additionally, reconciliation measures must comply with Section 313 of the Budget Act, known as the Byrd Rule, which means that whatever health legislation is reported from the Finance Committee or legislation from any other Committee that is shoe-horned into reconciliation will sunset after five years. Additionally, numerous other non-budgetary provisions of any such legislation will have to be omitted under reconciliation. This is a very messy way to achieve a goal like health care reform, and one that will make crafting the legislation more difficult.

My first wife, Renee, died of cancer in 1995. She was 42. I returned to the Winship Cancer Center in Atlanta to see what progress has been made in diagnosis and treatment.

Dr. Carl D’Orsi, head of radiology noted that we have a cure for cancer; early detection. Big advances are being made in imaging and diagnosis.  Dr. D’Orsi demonstrated a topographical mammogram.  This experimental machine can take a remarkably clear image of a tumor too small to be detected by a traditional mammogram . This same machine can also read a section more clearly that may look suspicious in a mammogram and see that there is no tumor, effectively avoiding unnecessary biopsies.

This machine will likely be able to increase the effectiveness of treatments by catching it earlier. But it is expensive, and it is experimental. Few places have them.   I saw other imaging systems that are also experimental and offer great hope.

I also saw huge laboratories involved in new techniques of delivering chemotherapies such as nanotech  targeting systems.

They have developed genetic testing that can  determine your odds of getting certain types of cancer. This aids the patient is selecting treatments that can dramatically reduce the chances of contracting cancer even in a high risk pool.  One of these tests costs $3,000.

Because of the costs of these treatments it is used selectively only for those whose risk profiles merits the extra expense. But the underlying point is that our health care system may be expensive because it is just so damn good. Anyone who has dealt with the fear and trauma of cancer know the value of these new developments; but we also must realize it is not cheap. Otherwise we risk never making these improvements available.

While the large insurance companies are commonly demonized, the reality is that their annual profits would not cover our health care bill for 48 hours.  The far more significant costs drivers are the quality of the technologies that deliver the best treatment systems in the world.

The cancer specialists at the Emory Winship Clinic were  troubled over the new government standards restricting mammograms for younger women. The committee establishing these new standards, which will likely be adapted by the insurance companies, did not have a single radiologist or oncologist on them.  Clearly these standards should rely more on individual case histories than simple age categories.

I would much rather trust my health and the health of my family to the professionals at the Winship Center and other advanced centers than to the government data crunching agencies that know nothing.  They may not be a death squad but such irresponsible regulations accomplish the same goal.

Perhaps it is not the end of the world if our health care system is expensive. Perhaps it is worth it.

The health care summit accomplished very little, nor did many expect it to. The ruling party has made the tragic mistake of breaking the trust of the electorate.  The Louisiana purchase, the Nelson Nebraska bribe, the failure to keep the promise of openness and transparency has destroyed the trust of the voters.

In business one can easily recover from a mistake, but it is far more difficult to recover from a betrayal of trust.

This betrayal is compounded by the arrogance that flows from the ruling party.  When the opposition is treated as devoid of intelligent thought or is treated as having questionable motives there is little room for coming together at any summit.

If the president seems to kill this disastrous health care bill a little more every time he has addressed it in the past why would he think that addressing it in a summit with the cameras rolling will now help it; especially if he has not changed his message or his style.  A note on leadership and power: If you have to state that you are the president you are stating that you have the power and control. If you have to state this, if it is not apparent and obvious from those around you, then you do not have the power nor the respect of the people in the room.

But this summit did succeed is highlighting two significant differences between the two parties. For one party health care is a right, and for the other it is a responsibility.  There is a distinct difference between a right such as free speech which requires no transfer of wealth to bestow and a right to an expensive service which must be paid for by another party.  The former is made available equally to all citizens; the latter requires the force of government to rob one citizen to give to another. The former empowers all citizens; the latter fosters dependency.

The second highlighted difference is the emphasis on the emotional verses the rational.  Trillion dollar policy should not hinge on emotionally laden anecdotes. “I’ve seen grown men cry,” noted Pelosi.  We have to have a clear understanding of the issue supported by accurate numbers.  Numbers are thrown around so loosely nobody believes them. The 46 million uninsured has now been dropped to 30 million and some estimates have at a much lower number.  And uninsured is not synonymous with  being without coverage.  Ask any doctor.

The numbers may not paint a complete picture but they cannot be ignored.  It is better to have an imperfect system that is sustainable that a better system that is not.

Finally there is the comprehensive trap; the belief that a big problem can only be approached with a big solution.  Big systemic solutions are fraught with unpredictable consequences, hidden costs, uncontrolled bureaucracies and endless expensive patchworks adjustments.  Most less complicated and ambitious reforms have far outstripped their cost estimates.

There are real health care problems and real health care solutions, but the big systemic solutions that focus on the fundamental philosophical differences between the two parties was doomed to fail from the beginning . No summit could change that.

The following was a reader’s comment to my article in American Thinker, “Why Elitists Fail“

Human beings can exist in one of only two modes: by controlling nature, or by controlling those who control nature. Those in the first category survive by acting in accordance with the facts of reality. Those in the second survive by manipulating the perceptions of other men. The method of thinking required for one is the opposite of that required for the other, and cannot coexist in the same man. Those most successful at manipulating the perceptions of other men (the political elite) will always be those least connected to reality.

We are ruled by parasites, who must constantly evade the knowledge of their own dependency, and who have no conception of their hosts’ limits. They will suck us dry, while neither knowing–nor caring if they did know–that their own deaths must necessarily follow.

David Broder writes a great piece in the New York Times, The Populist Addiction

excerpt:

It’s easy to see why politicians would be drawn to the populist pose. First, it makes everything so simple. The economic crisis was caused by a complex web of factors, including global imbalances caused by the rise of China. But with the populist narrative, you can just blame Goldman Sachs.

Second, it absolves voters of responsibility for their problems. Over the past few years, many investment bankers behaved like idiots, but so did average Americans, racking up unprecedented levels of personal debt. With the populist narrative, you can accuse the former and absolve the latter.

Third, populism is popular with the ruling class. Ever since I started covering politics, the Democratic ruling class has been driven by one fantasy: that voters will get so furious at people with M.B.A.’s that they will hand power to people with Ph.D.’s. The Republican ruling class has been driven by the fantasy that voters will get so furious at people with Ph.D.’s that they will hand power to people with M.B.A.’s. Members of the ruling class love populism because they think it will help their section of the elite gain power.

So it’s easy to see the seductiveness of populism. Nonetheless, it nearly always fails. The history of populism, going back to William Jennings Bryan, is generally a history of defeat.

That’s because voters aren’t as stupid as the populists imagine. Voters are capable of holding two ideas in their heads at one time: First, that the rich and the powerful do rig the game in their own favor; and second, that simply bashing the rich and the powerful will still not solve the country’s problems.

From “Why Elitists Fail” in American Thinker, January 30, 2010

Even the brightest minds cannot escape emotional impediments to a rational conclusion. Combining such emotional rationalism with a focus on theories detached from the verification of practical experience can be downright dangerous. This is why it concerns so many that Obama’s administration has the lowest number of appointees from the private sector in his cabinet of any president in history.

The average American knows that taking a dollar from one person and giving it to another does not create a stimulus. The average parent knows that protecting one from the consequences of bad decisions does not teach one to make good decisions. The individual citizen knows that the government will not make better health care decisions or better investment decisions because they will never know as much as all the citizens. The voter who knows the consequences of too much debt on his household does not find it more acceptable when a lot of zeros are added to the balance and the loan account is moved to Washington, D.C.

Thomas Sowell writes in the National Review

The ‘Science’ Mantra

Excerpt:

Today, politicized “science” has too big a stake in the global warming hysteria to let the facts speak for themselves and let the chips fall where they may. Too many people - in politics and in the media, as well as among those climate scientists who are promoting global warming hysteria - let the raw data on which their calculations have been based fall into the “wrong hands.”

People who talk about the corrupting influence of money seem to automatically assume that it is only private money that is corrupting. But, when governments have billions of dollars invested in the global-warming crusade, massive programs are underway, and whole political careers are at risk if that crusade gets undermined, do not expect the disinterested search for truth.

Among the intelligentsia, there have always been many who are ready to jump on virtually any bandwagon that will take them to the promised land, where the wise and noble few - like themselves - can take the rest of us poor dummies in hand and tell us how we had better change the way we live our lives.

No doubt some climate scientists honestly believe that global warming poses a threat. But other climate scientists honestly believe the opposite. That is why the raw data have had to be destroyed before the latter get their hands on it.

This is tragically the case as regards many other issues, besides global warming, where data are made available only to the true believers and kept out of the hands of those who think otherwise.

“Could free markets have sorted out the mess without extraordinary government action? Yes, but only by destroying the remains of the financial system and possibly putting tens of millions of people out of work. Despite virulent public opposition to the Bush bailouts, society would not have tolerated the price that a sudden free-market correction of decades of financial excess would have exacted. The consequences of standing by while the markets did their work, correcting their own and government’s mistakes, would have been disastrous.”

“The administration’s response may have staved off depression, though that outcome is not assured. But the government has severely damaged four elements upon which free markets and the future well-being of the nation depend: prices, disclosure, failure, and fairness. Lawmakers and regulators have harmed the faith of global investors and regular citizens alike in American free markets- a faith essential to growth and progress. President Obama has made the problems worse.”

From After the Fall:  Saving Capitalism from Wall Street- and Washington by Nicloe Gelinas

If you have to read only one book about the recent financial  fiasco, this is it.

Here is an idea for our times.

We create a Federal Agency called the Consumer Investment Information Corporation.

It is funded by a fee on all banks and institutions needing an independent investment rating.

It is governed by nine people; three selected from each political party representative group in the Congress, and another three selected from the first six. The last three can be academics or professional analysts.

The CIIP can hire investment services like S&P and Moody’s to rate the financial institutions. The rating service would no longer be hired and paid by the institutions they rate; they would be serving the consumer.

Over a period of say 5 years, the FDIC protection would be removed from banking institutions. During that time a CIIP rating would be given on those institutions on their relative stability and strength.  Banks could then compete on the basis of stability and financial strength. Higher rated banks could sell CD’s with lower yields since they provide value through their strength. Lower rated banks would have to pay a higher interest rate to compensate for their higher risk.

Current FDIC protection has replaced market information. Consumers do not care about the strength of their banks because they have federal insurance protection. It has encouraged reckless banking behavior. Every time the FDIC limit is raised the banking sector acts more irresponsibly.

It is time to let the market function by providing information, rather than rendering the information irrelevant by guaranteeing incompetence.

One of the most stifling attributes of political life is the inability or the unwillingness for anyone to admit a mistake. There is so much uncertainty about actions that often require significant action that mistakes are bound to happen- serious mistakes.

I wanted Bernanke retained as Fed Chief not because he did not make mistakes but because he did.  Part of his experience that is so valuable is seeing what happened when he was wrong.

In business such mistakes are faced quickly, although large bureaucratic organizations also fear accountability in the free market. But such an admission in government is considered deadly to a political career. Maybe it is naïve to expect politics to be more honest.  The public’s idea of accountability is to fire someone for a mistake. We could all learn so much if we faced and openly discussed a mistake and made serious proposals to avoid replicating the errors.

If we keep disposing of elected officials who make mistakes, we will end up with officials in high office with no useful experience.

We’ve already tried that.