Theory of a “few bad apples”

The recent decision of AG Eric Holder to investigate CIA crimes limits the scope to only those who may have exceeded the Bush Administration’s legal guidelines on torture. This implies that there were simply a “few bad apples” who intentionally broke the law. In the end, if the only ones who are prosecuted are lower level CIA operatives, this will be a gross miscarriage of justice. The “few bad apples” theory may be correct; however they were those who authorized the activities in the first place. Perhaps this is why Mr. Cheney continues to vigorously protest these investigations. In the words of William Shakespeare: “Me thinks he doth protest too much.”

Healthcare Reform or Lobbyist Rhetoric?

Why we need healthcare reform and not irrational rhetoric

After reading the recent letters to the editor which simply parroted the insurance industry talking points designed to either stop or water down healthcare reform, I was struck by the fact that people are not looking at the real issues. Some members of Congress and their industry-paid lobbyist allies insist that we have the best healthcare system in the world, but in fact, our current system screams out for much needed reform. The organized effort to misdirect the conversation away from the real problems is counterproductive to resolving an impending healthcare crisis. Perhaps most members of Congress have relied for too long on their government-run health insurance to realize the problems that ordinary people face in trying to maintain their own health insurance. Instead of focusing on the real issues, they are disseminating misinformation about euthanizing senior citizens, paying for abortions, and putting government bureaucrats in-between you and your doctor. Here are the undisputed facts which can not be ignored which are available from independent sources:

*Nearly 50 million Americans do not have health insurance, and another 25 million are underinsured. Furthermore, all Americans are at risk of loosing private employer based coverage which is currently not portable when you loose you job.
*The cost of COBRA insurance (continuation of benefits from your old job) is unaffordable for most people who find themselves unemployed. Typically the employer will make the coverage available as required by the COBRA law, but they set the rates so that the former employee is paying 100% of the cost.
*Temporary health insurance policies available through private insurers are nothing less than the health insurance equivalent of predatory lending practices that got our nation into the current economic mess. These generally exclude all pre-existing conditions, so in practice they are really only available to healthy people. They also require huge deductibles and are only in effect for short terms up to a maximum of 90 days.
*A typical family health insurance plan now costs $12,000, but because employers typically pay about 70% of the cost, even those who have health insurance through their employer often don’t realize the true cost of their insurance.
*The current trend towards the so called “high deductible” plans which lowers the premium in exchange for people self-insuring more of their risk with health savings accounts simply shifts the cost of healthcare from the employer to the employee.
*The US spends more per capita on healthcare (twice as much as most other industrialized nations) and yet ranks only 19th in preventable deaths and 37th in overall performance according to the World Health Organization. In just a few years, healthcare expenditures in the US will exceed 20% of GDP.
*The annual increases of healthcare costs (average 7%) far exceeds the annual growth in real wages and is unsustainable not only for individuals but for the government’s programs like Medicare and Medicaid. Medical expenditures account for over 23% of the US federal budget and this will only balloon as the baby boomers reach retirement age and become eligible for Medicare. State governments are also dealing with the cost of increased healthcare spending as a larger part of their budgets. These same annual trends are making it increasingly impossible for business both large and small to offer medical benefits to their employees. In a globally competitive economy, this increasing cost of healthcare puts US companies at a global competitive disadvantage.

These are all symptoms of a broken healthcare system. Some would even argue that it is such a mess that it can not even be called a system because it was never designed as a system, but simply evolved over the years. Whether you agree or disagree with the characterization of the “system,” no rational person can objectively look at healthcare in the US and conclude that we are getting our money’s worth. Said another way, we are collectively getting taken to the cleaners by the current healthcare “system” as we pay premium prices and get inferior outcomes. This should be the true outrage.

This is not meant to disparage the thousands of dedicated health professionals who are tending to the sick and injured everyday; however, the collective “healthcare system’ run by insurance companies and corporate interests is more focused on financial performance than patient outcomes. This paradigm will not change unless we get some real reform, and not some watered down version of expanded private health insurance promoted by the industry lobbyists.

Here are some solutions that would have a significant impact:
*Standardize healthcare administration.
*Restrict the use of television advertising for prescription drugs.
*Change the law and allow the government to negotiate with drug companies.
*Implement a universal health insurance requirement.
*Implement a public option and restrict the ability of private insurance to deny coverage or terminate policies for frivolous reasons or pre-existing conditions.
*Increase enforcement of fraud prevention and fully prosecute perpetrators.
*Increase funding for medical scholarships and expand public universities to matriculate more medical students.
*Implement managed care programs for people with chronic diseases.
*Experiment with changing the business model from fee for service to salaried providers or payment for outcomes.

These are just some of the ways to really address the issues of healthcare reform short of a single payer system. Changes like these still leave the private sector ample room to run their business profitably, albeit with some different operating parameters. Opponents of healthcare reform are absolutely correct about the need to control costs, but they offer no concrete solutions other than disseminate misinformation like killing senior citizens. That is simply a manufactured distraction with the sole purpose of not killing seniors, but killing anything that resembles real reform. Don’t let them scare you. It is simply an effort to just maintain the status quo for the special interests who profit from the current inefficiencies of our broken system. This is the time to make changes, and if we don’t do it now, then when?

Cheney is Right - about one thing

In the recent debate between President Obama and former Vice President Cheney over closing Guantanamo, Cheney was right about one thing: "There were just a few bad apples." Where he got it wrong was that the "few bad apples" were not only at Abu Graib prison as he described, but were in fact in the White House.

In his speech to the right wing American Enterprise Institute to defend waterboarding and other enhanced interrogation techniques as legal by his mere assertion, Cheney admitted that the Bush administration authorized and condoned these activities! These are the same activities that American courts here at home and Military Tribunals from World War II have found to be crimes in violation of not only American laws, but international treaties. They are in the same category of crimes against humanity for which Nazi war criminals were found guilty. Of course, as the right wing commentators would point out, the Nazis committed far worse atrocities on a grander scale too. Nevertheless, the fact that these techniques were used on only three individuals or that the intent was for the purpose of defending the country are irrelevant and only intended to gain sympathy or divert attention from the underlying crimes. Three, three thousand or three million, it doesn't make a difference: one instance of torture is a crime, and Cheney has openly admitted to it. They certainly are not activities for which America should be proud as Mr. Cheney seems to be as he offers an unsupported argument that he defended the nation and saved lives. Where were he and his colleagues when they were provided intelligence briefings at least a month prior to the 9/11 attacks warning of their possibility, and they did nothing? Me thinks he doth protest too much.

Since the time of the founding of the nation, beginning with President Washington when he was General Washington in the darkest days of the American Revolution, our leaders have renounced torture as our national policy. General Washington opposed torture even when the British used it against our own soldiers. From that point forward, Americans have held true to their basic values to defend our nation without resort to torture. It is only the Bush Administration's "few bad apples" who have changed our national policy. They should be held accountable because these are not just policy changes, if as admitted by the former Vice President, they are crimes. As painful as the process might be, we don't need a truth commission or congressional investigation, we need an independent prosecutor to look at all the facts and circumstance and make a legal, not a political, determination of crimes. Crimes that appear to a have been committed by a few bad apples at the highest levels of our government. If we don't do this, then future administrations will simply view these activities as "policy" issues rather than the "crimes" which they are. If you rob a bank at gun point, it matters not whether your intent was to use the money for a charity. The act of the robbery is the crime itself. If he thinks that his intent will exculpate himself and his few bad apple colleagues, then let him make the case in a court of competent jurisdiction. If he truly wants all the facts to come out, then as in the words of President Bush: "Bring 'em on."

As we approach Memorial Day weekend, let us not forget that American soldiers fought and died in wars to stop dictators and tyrants from perpetrating crimes against humanity. They all took an oath to defend our country from all enemies, foreign and domestic. Let's not tarnish their sacrifices by allowing a few bad apples who were in our own government at the highest levels get away with crimes that were based on tortured logic. That would be putting America First.

"I was just following orders"

The decision by the Obama Administration to not prosecute CIA officials for violations of law using “enhanced interrogation” techniques is regrettable. Even conservative Fox News legal experts concur that these acts were illegal despite the amateurish legal opinions of the Bush Justice Department. It is a sad chapter in our history, and only made worse by not holding those who are responsible accountable for their actions. It is also ironic that in a week when there was a news story about a suspected ailing German SS prison guard from Ohio being pursued for alleged war crimes, our current Attorney General will let the current perpetrators of these crimes get away with them under the twisted legal guise of “I was just following orders." It seems like that defense was raised once before in a place called Nuremberg and it didn't fly then and shouldn't fly now. Even if the CIA officers who actually did the deeds are not prosecuted, then those most responsible at the highest levels of government should be since they are the real perpetrators anyway.

Why not bankruptcy?

I was a strong supporter for Barack Obama for President, and am still extremely hopeful that he will bring the change we need right now in America; however, today I am finding myself in more agreement with some of the Republicans on current issues. Specifically on the economy.

The issue of the day is a bailout for the auto industry.* Led by Carl Levin this bailout is being pushed by the Michigan congressional delegation who are being squeezed by the auto executives and their union allies. These are the same people who crated the mess by lobbying against increased fuel efficiency standards while they sold gas gusseling SUVs, pickups and Hummers. They are now also in partnership with Wall Street big wigs like Cerberus Capital Management who have gambled billions and are likely to loose their investment unless the taxpayers bail them out. Like the war on Iraq, like the three-page $700 billion financially system bail out, the auto crisis is now being portrayed as an immediate and impending disaster that requires a bushel full of money without any debate. We have seen this movie before. What about the taxpayer? Why should the taxpayer bear the brunt of their mismanagement and incompetence? Why not utilize the existing market mechanisms to bring about the changes we need? Specifically, why not bankruptcy?

The framing of the argument used by Levin and his cohorts (remember Carl Levin was also a leader on the Senate Armed Services Committee when they pushed the authorization to use force that got us into the mess in Iraq so he knows how to make the argument) is that if the US automakers fail, then there will be a loss of three million jobs. This is a false argument. It is not an either/or choice. The choice is not to give them a loan or watch them go out of business. There is another choice and that is a bankruptcy reorganization under Chapter 11. Levin paints the possibility of a bankruptcy reorganization as if it means that they will shut down these companies. Not true! Lots of companies have been through bankruptcy and come out of it as stronger, leaner and more competitive operations. A bankruptcy reorganization would likely remove the existing management, restructure the financing by removing the current owners, and yes, perhaps closing some inefficient parts of their organizations.

So why not get rid of the existing management? They have already failed. They put these jobs in jeopardy with poor management decisions supported by overreaching union leadership that focused more on getting unrealistic benefit packages than the viability of the enterprises. They failed to engineer new fuel efficient vehicles while their competitors did so. They failed to modernize their plants while their competitors built new ones here in America. They chose to diversify into non-auto related businesses that squandered their resources into mortgage banking, computers, and data management. They don't have a restructuring plan now and all they can do is threaten disaster if they don't get a loan. I can just about guarantee you that they will be back for more because they don't intend to make any fundamental changes in their operations. This situation cries out for a new management team that will be willing to make changes in their organizational cultures, products and manufacturing practices. This needs to happen before they get a dime of taxpayer money.

Why not restructure the finances of these companies? In the past few years, the auto makers have attempted to deal with some of their financial woes by selling investors from the private equity market to gamble on them. Big shots with deep pockets decided to take a gamble. Cerberus bought 50% of GMAC which at the time was the crown jewel of GM because it made money and subsidized the inefficiencies of the parent GM auto company. Cerberus also bought 100% of Chrysler after the German auto maker, Daimler-Benz decided they they could not make this company work. Other large well know investors have been in and out of these stocks over the last few years trying to make a fast buck by playing the market. These gambles have not paid off. It is now time for these investors to pay the piper. A bankruptcy reorganization will essentially wipe out the current stockholders, and replace the ownership of the company with the creditors. This will lower the debt service for the companies while streamlining the capital structure, and eliminating the outside influence of a hedge fund that is not obligated to report its financial performance to the public.

Will bankruptcy result in some job losses. Absolutely. There are many inefficiencies in these organizations from the top to the bottom: product development, manufacturing and retail distribution. Will some manufacturing facilities need to be closed? Yes. Will some white collar jobs need to be eliminated? Yes. Will the unions need to make concessions? Perhaps. Will some dealers shut down? Perhaps that too. But you can't get leaner and meaner if you don't make some of these changes. Remember the definition of insanity: doing the same thing you are doing and expecting different results. Putting taxpayer dollars at risk without making changes is insane.

Is the auto industry a key factor in the economy? Absolutely. Should Congress and the public be concerned about the future of these companies? For sure. Should we try to save as many jobs as possible while making appropriate changes? Definitely. But making these changes is the only thing that makes sense before we taxpayers invest in these enterprises. And when we do, we should get preferred stock, just like we have done with the banks. Taxpayers should get paid back first when these companies recover.

For a campaign that was run on "change," it is time for the incoming administration to force the changes that are needed to turn these companies around. It may still not work, but not making any changes will just get us deeper into the hole. This will require a lot of courage, because the unions and the elected democratic officials from the Midwest supported Obama and are now calling in their chips. I hope the new administration will put America First and force the changes we need before we resort to business as usual and support the special interests. This is our first big chance to put America First!

*Also, by way of full disclsoure, I worked for a subsidary of GMAC for about 9 years up until a little over a year ago.

Strategy First

Now that the euphoria of the election is begining to subside, and the stock market is retreating again, it is time to consider the best way forward. With the weak economy, the new President-elect and the Congress are talking about another stimulus package. The automakers already have their hand out for another package on top of the 24 Billion they got when Congress passed the 700 Billion dollar fund just before the election. Congress will likely not wait for the new President to take office. They will do something during the lame duck session; however, if they don't have a better plan that is part of an overall strategy, they would simply be putting us further in the hole without having a positive impact on the economy. As a short term measure, they could simply extend unemployment benefits to tide over those who are actively looking for employment.

Giving the automakers another handout is a lot more questionable. GM is already suspending product development work on new vehicles for lack of cash, and GM alone has lost over 50 Billion dollars over the last three years. For one thing, they might not survive even with the handout. For another, both GM and Chryler are either owned by or closely aligned with the private equity group Cerberus. Investing in the banking system and regulated entities to keep capital flowing is one thing, but investing in companies owned by private equity groups who represent wealthy investors and play by their own rules is quite another. As a taxpayer, I am not excited about using federal funds to prop up investments that are owned by or feed the interests of a private equity firm. Knowing that Nancy Pelosi is meeting with the automaker executives today is a scary thought. People should also know that Cerberus is a very politically connected firm with people like former Secretary Treasury Snow and Vice-President Quayle among their high profile executives. They know how to work the system to their benefit which may not align with the rest of our national priorities.

What needs to happen right now is for the President-elect to define his strategic vision for the country. Many of these problems like energy, infrastructure, and the health of the economy are interrelated and also impact national security. The old Congressional approach of simply throwing some money at the problem of the day to those who speak loudest will not work anymore. We need Mr. Obama's leadership to set the priorities of our investments in the future in a more strategic way. Only by investing in accordance with a strategic vision will we be able to fix the problems and wisely use our limited resources. He has already outlined some priorities during the campaign: Energy, Health Care, Infrastructure Investment, and his tax plan for the middle class. He needs to be clear about where he wants to focus first so that Congress doesn't squander the available investment pool on pet projects or lobbied interests. This is the problem we are attempting to fix with the new Administration. So, lets not let Congress be stupid before the inauguration. We voted for change, so don't let them go back to doing business as usual. If we do that, then we will have lost our chance to put America First.

A New Day for America and the World

It is a new day for America and for the world! We will have change in Washington that will be reflected in new policies here at home and engagement with other nations abroad. As Barack himself said last night in a great speech after the election, it will not happen in a year or maybe even his first term, but change is coming. It will require a lot of work by lots of people, but we can be very hopeful for the future with Barack Obama's leadership.

In his first address to the nation and the world, President-elect Obama made the point to say that this is about you. He provided a compelling vision of the future like all great leaders do. However, we have a lot of work to do to help this new President. We all need to reach out to listen to those who have different views because it will also require help from all the people regardless of party affiliation. We need to understand where we have common ground and can work together. Help out where you can to make a difference in supporting solutions that work for all of us on energy independence, health care, and economic reform, because this is just the beginning - not the end. Hold your elected officials at all levels accountable to do what is in the best interest of our community, your state, and the nation.

What we witnessed last evening was a triumph for democracy. It was reflected with celebrations at home and around the world. The citizens of this country spoke loud and clear that they are tired of the politics of division and policies that don't put America First. The problems are too big and we don't have time to waste.

So enjoy this day and appreciate the historic significance represented by Barcak Obama's election. However, let's all be prepared to help take advantage of the opportunity that his presidency represents. Yes we can, finally put America First!