| Number 435 | August 6, 2009 |
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This Week: Health Care, Health Care, and Tax Scams
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Greetings, All I can say in this week's editor's note is THANK YOU! The 2009 Summer Nygaard Notes Pledge Drive has met its modest goal of FIVE new Pledgers. And so many of you took advantage of the Drive to renew your Pledges early, and increase the amount of your Pledges. Yay! Nygaard Notes will continue into the future. I am humbled and grateful. Nygaard |
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"This is such a stunning misallocation of resources." That's Joseph A. Califano Jr., chairman of the National Center on Addiction and Substance Abuse, referring to the fact that, while government spending related to smoking and the abuse of alcohol and illegal drugs reached $468 billion in 2005, a mere 2 percent of the total went to prevention, treatment and addiction research. Reported in the NY Times of May 28. |
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I started thinking about headlines and health care when I saw an article in the Business section of my local paper the Star Tribune of June 3rd. The article was about the "annual shareholders meeting of the country's largest health insurer," UnitedHealth Group. Their headquarters are in Minnesota, so their meetings are here. Activists were at the meeting, as they often are, to protest the greed symbolized by this "health care" giant, whose profits of $859 million in the past three months were more than double the same period last year. The main message of the protest was summed up in the fourth paragraph by a protester who said, "The dichotomy is need and greed." A reporter asked what the solution might be. "Single payer. Everybody in, nobody out," said the protester. In the second-to-last paragraph the Star Trib stated that "UnitedHealth says it has long supported universal coverage (but not single payer)." So, the text of the article clearly shows that the focus of the event being covered was to protest the greed of the nation's largest health insurer and to call for a single-payer system of national health insurance, which UnitedHealth opposes. Yet, somehow, the headline on this "business" story came out like this: "Unitedhealth Meeting Is Scene of Plea for All-inclusive Health Care." Now, in case you think that the headline had no room for the word "single-payer," note that the word is one letter shorter than "all-inclusive." Is there some rule about not putting "single payer" in a headline? One wonders... |
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In the previous article I talked about my local paper's weird substitution of a confusing word (all-inclusive) for a shorter and much more clear and accurate word (single-payer) when talking about health care reform. That was a weird example, but hardly unique. The media coverage of the issue of "health care reform" reflects the gap between the public consciousness and the information gatekeepers in the media. Public consciousness increasingly favors something like a single-payer solution to the health care crisis, while the media... well, the media. Let's look at some more headlines. In the first three months of this year, despite the popularity of single-payer in the polls, the word "single-payer" appeared in a major newspaper headline only 29 times. In the past three months it has appeared 107 times. The increase is likely due to the fact that the overall coverage of health care "reform" has increased. The real gap is revealed when one analyzes the nature of the headlines. Not only is single-payer generally kept out of the headlines, but when a headline does mention single-payer that headline usually appears not in the news pages but in the opinion pages, very many of them in the letters to the editor, in fact. In addition, most mentions appear in the regional papers, like the Flint (MI) Journal, the Seattle Post-Intelligencer, and the Salt Lake Tribune. In the period of January-March of this year not a single mention of single-payer was seen in a headline in either the New York Times or in the Washington Post, the nation's main news agenda-setters. In the most recent three months the Post had a whopping total of three mentions while the Times maintained its headline blackout. This is despite roughly 200 articles in each of those papers featuring health care, and despite the polls. As I said above, surveys show that a plurality and usually a majority of people in the U.S. favor a national single-payer plan (between 49-66 percent, depending on the poll and the wording). That's really remarkable when one considers the failure to discuss this realistic option on the part of the media. Since Nygaard Notes is not in the business of mind-reading, it's impossible for me to characterize the media's relationship with single-payer health care as a phobia, an aversion, a blind spot, or some more-complex socio-psychological phenomenon. But there is something very weird going on, and the weirdness happens to serve, and serve very well, the interests of the Individualist and Competitive (i.e. "conservative") sectors of our society. Speaking of "conservative".... |
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"The fate of the health care overhaul largely rests on the shoulders of six senators who since June 17 have gathered—often twice a day, and for many hours at a stretch—in a conference room ... in the office of the Senate Finance Committee chairman, Max Baucus, Democrat of Montana." That was the third paragraph of a front-page article in the New York Times last week (July 28). I wish I could publish the photo that went with it, but in lieu of that let's look at these six senators and whom they represent. The states represented by these six senators upon whose shoulders so
much rests How these six senators were selected I do not know. But they don't represent the diversity of the country very well, do they? It's five white men, one white woman, all from states that range from small to tiny, and all of which are overwhelmingly white. Meanwhile, the percentage of white people who are uninsured in the U.S. is about 6 percent, while the percentage of black people uninsured is triple that, about 18 percent. (There is only one black senator, he was appointed to replace Obama, and is not running for re-election.) If I may be allowed to speculate for a moment, I would guess that the health care "reform" that these six senators from their tiny white states produce—if they produce any reform at all—will result in a system that, like the present one, best serves the interests of the tiny, largely-white group that benefits from the system as it is. That is, industry executives and the people who own the stock in their companies. Or, in the more-polite language of the New York Times, "if the three Democrats and three Republicans can pull off a grand bargain, it will have to be more conservative than the measures proposed by the House or the left-leaning Senate health committee." |
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In the past few weeks I've been talking about Afghanistan and how reports of criminal activity on the part of U.S. forces typically result in a promise to "investigate." These promises are typically followed either by no investigation or a failure to report on whatever investigation was undertaken. The pattern is not limited to military misconduct. It extends to corporate misconduct, as well. Here's a small story to illustrate. Does anyone remember the Homeland Investment Act? This was "a
one-time tax holiday on the repatriation of foreign earnings by U.S.-based
multinational enterprises," passed in 2004. The San Jose Mercury News reported back in 2004 that "The proposal, which earned the support of 75 of 100 U.S. senators the last time it was voted on in 2003, would slash the U.S. corporate tax rate to 5.25 percent for one year, drawing an estimated $135 billion to $300 billion back into the economy." At the time this bill was introduced (2003) the corporate lobbying bunch were heard to make all sorts of claims about the benefits of the bill. A scary creature named the "Homeland Investment Coalition" was born in 2003 to lobby for the bill. When I say "the corporate lobbying bunch," I have in mind the membership list of the "Coalition" that includes everyone from Boston Scientific to DELL to Nike to Schering-Plough to Sara Lee. And many more. The Coalition told their targeted Congresspeople and the rest of us that the repatriated money "would benefit the U.S. economy by: Increasing domestic investment in plant, equipment, R&D [Research and Development], and job creation; Increasing investments in business ventures in emerging technologies, Increasing funding for pension plans depleted by declines in the stock market; Improving the long term financial strength of U.S.-based companies by reducing domestic debt loads, strengthening corporate balance sheets, and lowering corporate bond rates; increasing dividends to shareholders (which can be productively redeployed); and raising equity market valuations by increasing funds available for share repurchases." The Heritage Foundation echoed the point, saying that "This money [repatriated by the multinationals] would be used for new investment, to reduce debt and to bolster pension funds." Sure. Even the heavily-lobbied Congress was a little suspicious that this money might not be put to use to "benefit the U.S. economy," so they made sure that the law "specifically said the money could not be used to raise dividends or to repurchase shares." That point was stressed by Floyd Norris, a New York Times business columnist, writing on June 5th of this year. Now the most detailed analysis of what actually happened—using confidential government data as well as corporate reports—has told us what actually did happen with the $299 billion that companies brought back from foreign subsidiaries during the "tax holiday." The National Bureau of Economic Research—not by any means a radical group—put out a report in early June entitled ''Watch What I Do, Not What I Say: The Unintended Consequences of the Homeland Investment Act." It was full of interesting information. Too bad nobody (except columnist Norris) reported on it. Here are a few highlights from the report: ''Repatriations did not lead to an increase in domestic investment, employment or R&D, even for the firms that lobbied for the tax holiday stating these intentions... In fact, increased repatriations in response to the HIA had small negative, but insignificant, effects on domestic employment and R&D expenditures..." "A key goal of the HIA . . . was to promote investment and employment in the United States. The HIA . . . included specific guidelines on how cash repatriated at the lower tax rate could be used in order to ensure that repatriations were mainly used to further these goals. This paper clearly shows, however, that these guidelines were ineffective in achieving these specific goals. Estimates imply that firms returned almost all of the repatriated cash to shareholders—a use that was explicitly not permitted." And, finally, from the Conclusion: "Statements by Congressmen and lobbyists indicate that they believed that reducing repatriation taxes would increase the domestic activities of U.S. multinational enterprises. This paper's results clearly show that the tax holiday did not have this effect." (Of course, all that NBER knows is what lobbyists said, not what they "believed.") I mentioned that a NY Times columnist was the only one to report on the NBER study, but it's worse than that. There was very little reporting on the Homeland Investment Act in 2004, when it was debated and passed. But there has been almost literally NO reporting on the multibillion-dollar scam that resulted from this "tax holiday." Remember the cycle in Afghanistan: 1. Intentions are stated; 2. Crimes are reported; 3. Investigations are promised; 4. All is forgotten. With corporate crime the media reports the intentions that are stated to pass a bill or reduce a regulation. Then we skip right to the forgetting. This is where the media is supposed to come in, eh? Whether it's investigating war crimes or investigating the consequences of economic legislation, there are people in this country who take the time to follow up and tell us what results from the actions of our government and corporate "leaders." However, if the media fails to report on these investigations, they do no good. In fact, they may as well never have happened. Journalism, it has been said, is the first draft of history. And George Santayana said that "Those who cannot learn from history are doomed to repeat it." We need a free and independent press to tell us about our history as it unfolds. After all, without a full and accurate first draft of history, we will continue to fail to learn from it. And this story, unfolding as it did while the current economic storm was still gathering, might have helped all of us to take more seriously the evidence that our corporate leadership was screwing things up, big-time. Instead, economic history unfolded, much of it remained unreported, and now it looks like we are repeating the history of 1929, or maybe 1893 or 1882 or 1839. Bad times, the media should have helped us see them coming. |
