“This is education,” U.S.-style [ht: sm]—privately run, publicly funded, and irregularly regulated. . .
“This is education,” U.S.-style [ht: sm]—privately run, publicly funded, and irregularly regulated. . .
Jamie Galbraith’s ties to Greece go back some seven decades, most recently as an adviser in the Ministry of Finance (working with Yanis Varoufakis) for the Syriza government.
In a recent comment (itself a summary of his new book, Welcome to the Poisoned Chalice: The Destruction of Greece and the Future of Europe), Galbraith [ht: cb] has presented a clear, trenchant critique of Europe through its treatment of Greece.
Last year’s third bailout of Greece, imposed by Europe and the International Monetrary Fund, does to Greece what Versailles did to Germany: It strips assets to satisfy debts. Germany lost its merchant marine, its rolling stock, its colonies, and its coal; Greece has lost its seaports, its airports — the profitable ones — and is set to sell off its beaches, the public asset that is a uniquely Greek glory. Private businesses are being forced into bankruptcy to make way for European chains; private citizens are being forced into foreclosure on their homes. It’s a land grab.
And for what? To satisfy old public debts, incurred for tanks, submarines, the Olympics, big construction projects outsourced to German firms, and to hide deficits in health care, with creditor connivance — a quagmire of graft to support an illusion, that Greece could “compete” as part of the euro. Already in 2010 the IMF knew it was breaking its own rules by pretending that Greece could recover quickly, sustain a huge primary surplus, and repay its debts. Why? To help save French and German banks, which the IMF’s sainted managing director, Dominique Strauss-Kahn, wanted to do, because he wanted to be president of France.
Europe crushed the Greek resistance in 2015. Not because Wolfgang Schäuble, the German finance minister, thought his economic plan would work; he candidly told the Greek finance minister, Yanis Varoufakis, that “as a patriot” he would not sign it himself. But Germany wants to impose its order on Italy and on France, where civil society continues to fight back. And Chancellor Angela Merkel could not admit to her voters, or to fellow Europeans from Slovakia to Portugal, that back in 2010 she’d saved Germany’s banks by saddling them with Greek debts that could never be paid.
Greece was given collective punishment as a lesson. It was done to show that “there is no alternative.” It was done to stop any other attempt to develop, articulate, and defend a more rational policy. It was done to protect the power of the European Central Bank, the German government in Europe, and the policy-making authority, in face of a long record of failure, of the IMF.
If there is an alternative for Europe, where would it come from? According to Galbraith, the process begins with the Democracy in Europe Movement (or DiEM25), launched in 2015 by Varoufakis. But it doesn’t stop there.
Ultimately there would have to be big changes, as revolutionary as the 2015 Athens Spring. The old oligarchies, the Brussels cabals, the self-serving technocrats, and the economic ideologues who now dominate European economic policy would have to yield.
The Wall Street Journal refers to it as “insurers playing a game of thrones.”
Big U.S. insurers are courting one another for possible multibillion-dollar deals. How they pair off could have significant implications for the managed-care industry, its individual and corporate customers, and U.S. medical providers. . .
“Usually, fewer competitors means prices will be less advantageous for consumers,” saidGary Claxton, an insurance expert at the Kaiser Family Foundation. “It probably means they’re going to be in a better position to maintain their margins,” he said.
Given the high costs of U.S. healthcare, insurance is obviously the way most Americans are able to gain some kind of access to the health system.
According to the latest (January–March 2015) National Health Interview Survey (pdf), about two-thirds of Americans below the age of 65 rely on private health insurance. The rest either don’t have health insurance coverage (10.7 percent) or have some kind of public health plan (24.2 percent).
The problem is, even without the latest proposed mega-mergers, the U.S. private health- insurance industry is already highly concentrated. Treating Blue Cross Blue Shield (BCBS) affiliates as a single industry (since, with few exceptions, they have exclusive, non-overlapping market territories and hence do not compete with one another), and adding in Anthem (which operates the for-profit Blue plans across 14 states), the national market share of the four largest insurers increased significantly from 74 percent in 2006 to 83 percent in 2014. By comparison, the four-firm concentration ratio for the airline industry is 62 percent.
Much the same process of concentration has been confirmed by examining the so-called Herfindahl-Hirschman index.* Health insurance, as shown in the red line in the graph above, is the most concentrated industry (compared to, for example, hospitals and telecom). With a current index near 4,000 (having risen 79 percent between 2000 and 2014), and some states with indices exceeding 8,000, health insurance is easily considered highly concentrated.
It should come as no surprise that growing concentration in health insurance (based, mostly, on mergers and acquisitions) has meant both lower payments to providers (like physicians and hospitals) and higher premiums for payers (both employers and individuals)—thus boosting health-insurance profits.
So, within the U.S. healthcare system, Americans who don’t qualify for public programs are forced to rely (directly or indirectly) on a private health-insurance industry that is increasingly concentrated (and, if the proposed mergers go through, will rise even higher on the Herfindahl-Hirschman index) and is able to dictate both prices and the quality of policies.
Right now, if private health insurers suffer losses (as they claim has been the case under Obamacare, when they can’t pick and choose the healthiest customers in the exchanges), they can take their ball and go home. As James Kwak explains,
The obvious market-based solution is to keep increasing the penalties for not being covered until enough healthy people join the pool so insurers can make profits. But all that accomplishes is shifting more of the overall losses onto healthy people.
The obvious alternative is to reap the benefits of the current level of concentration and transform the existing private health-insurance programs into a public single-payer system.** That would succeed in creating universal coverage, lowering healthcare costs, and redistributing the losses across the society on the basis of an ability to pay.
*The Herfindahl-Hirschman Index is used by the Antitrust Division of the U.S. Department of Justice and the Federal Trade Commission to evaluate the potential antitrust implications of acquisitions and mergers across many industries, including health care. It is calculated by summing the squares of the market shares of individual firms. Markets are then classified in one of three categories: (1) nonconcentrated, with an index below 1,500; (2) moderately concentrated, with an index between 1,500 and 2,500; and (3) highly concentrated, with an index above 2,500.
**It’s possible, of course, to imagine a middle ground, with higher marketplace subsidies for purchasing private insurance, stricter penalties for individuals who aren’t interested in purchasing insurance, and a limited government option. But that’s just an attempt to juggle the parameters of the existing institutional structure, without recognizing and overcoming the social costs of a system based on private health insurance.
It took two and a half years but, on the basis of yesterday’s ruling by the National Labor Relations Board (pdf), research and teaching assistants at Columbia University now have the right to form a union (as GWC-UAW Local 2110).
It comes as no surprise that Columbia’s administration opposed the ruling:
The university said in a statement Tuesday that it’s reviewing the ruling, but that it “disagrees with this outcome because we believe the academic relationship students have with faculty members and departments as part of their studies is not the same as between employer and employee.”
First and foremost, Columbia said, “students serving as research or teaching assistants come to Columbia to gain knowledge and expertise, and we believe there are legitimate concerns about the impact of involving a nonacademic third party in this scholarly training.”
And the consequences of the NLRB ruling extend far beyond Columbia:
NPR’s Yuki Noguchi reports that “only a small fraction of graduate students at public universities are currently represented by unions — but the decision governing private university students is expected to lead to unionization efforts that could organize tens of thousands more.”
The NLRB had long held that students who teach or research at a private university were not employees covered under the National Labor Relations Act, Yuki reports. That changed in 2000, when the board decided a case in favor of students, and changed again with another ruling four years later. Now the NLRB has reversed itself yet again.
In Tuesday’s decision, the board majority wrote that the 2004 ruling “deprived an entire category of workers of the protections of the Act, without a convincing justification in either the statutory language or the policies of the Act.”
Peter Salovey, president of Yale, said in a separate statement that the “mentorship and training that Yale professors provide to graduate students is essential to educating the next generation of leading scholars” and that he’d “long been concerned that this relationship would become less productive and rewarding under a formal collective bargaining regime, in which professors would be ‘supervisors’ of their graduate student ‘employees.’”
But the American Association of University Professors, which argued in an amicus brief in the Columbia case that collective bargaining can improve graduate students’ academic freedom, applauded the NLRB decision.
“This is a tremendous victory for student workers, and the AAUP stands ready to work with graduate employees to defend their rights, including rights to academic freedom and shared governance participation,” Howard Bunsis, chair of the association’s Collective Bargaining Congress and a professor of accounting at Eastern Michigan University, said in a statement. “Graduate employees deserve a seat at the table and a voice in higher education.”
Last week’s unrest in Milwaukee wasn’t caused by the police killing of Sylville K. Smith, a 23-year-old black man. It’s been brewing for decades.
As Roger Bybee explains,
The recent outbreak of violent rioting in Milwaukee came as no surprise to anyone paying even the slightest attention to the deterioration of conditions for the city’s African Americans, especially the young.
Even CNN [ht: ja], which botched (and then, later, apologized for) its reporting of Sherelle Smith’s remarks about moving violence away from the local community, understood “The ongoing protests and violence that have occurred over the past several days in Milwaukee are about more than the police killing of Sylville Smith.”
In a recent report, the National Urban League (pdf) examined economic data for African Americans (and Hispanics) in 70 metro areas and found that Milwaukee has the largest gap in unemployment between blacks and whites in the country and the second biggest income gap.
The unemployment rate for blacks in Milwaukee is 4 times that for whites, while the median income for black households is only 40.8 percent of white household income. (Nationally, the corresponding numbers are 2 and 60 percent.)
Those racial inequalities in Milwaukee are both a condition and consequence of the economic and racial segregation of the city. Thus, while the majority-white downtown area is booming (with trendy new restaurants and craft breweries), outlying majority-black neighborhoods in and around Sherman Park (where the shooting took place) are falling farther and farther behind.
And, in the final contribution to the foul Milwaukee brew, the homicide rate (at 23 per 100,000, higher even than Chicago’s) is also unequally distributed across the city. Thus, for example, in the police district that includes the downtown, the homicide rate was just two, while in the bordering district to the northwest of downtown (which includes Sherman Park), the murder rate was 36, or 18 times as high.
As Daniel Kay Hertz explains,
High levels of gun crime profoundly affect neighborhood residents whether or not they are a direct victim. Witnessing a shooting, or having a friend or loved one become a victim, can be deeply traumatic, leading to depression, anxiety, difficulty concentrating at school or work, and other issues. High crime rates can affect whether businesses are willing to locate near your home, reducing your access to important services like banking, and contributing to depopulation and abandonment. . .
Nor are neighborhoods facing these issues randomly distributed: They are much more likely to be home to disproportionate numbers of people with low incomes and people who are black or brown. That racial and economic segregation play an important role in perpetuating deep social inequalities has been well-established. Directly and indirectly, violent crime is itself a crucial part of the basket of disadvantages that make living in a segregated neighborhood so costly.
It should come as no surprise then that the Brew City, with its strict segregation and profound racial inequalities, should have erupted after the latest police shooting.
And, as Bybee warns, unless the racial political economy of Milwaukee is criticized and transformed, “the recent explosions may signal more episodes of rage to come in the months ahead.”
On Tuesday, I began a series on the unhealthy state of the U.S. healthcare system—starting with the fact that the United States spends far more on health than any other country, yet the life expectancy of the American population is actually shorter than in other countries that spend far less.
Today, I want to look at what U.S. workers are forced to pay to get access to the healthcare system.
According to the Kaiser Family Foundation, about half of the non-elderly population—147 million people in total—are covered by employer-sponsored insurance programs.* The average annual single coverage premium in 2015 was $6,251 and the average family coverage premium was $17,545. Each rose 4 percent over the 2014 average premiums. During the same period, workers’ wages increased only 1.9 percent while prices declined by 0.2 percent.
But the gap is even larger when looked at over the long run. Between 1999 and 2015, workers’ contributions to premiums increased by a whopping 221 percent, even more than the growth in health insurance premiums (203 percent), and far outpacing both inflation (42 percent) and workers’ earnings (56 percent).
Most covered workers face additional out-of-pocket costs when they use health care services. Eighty-one percent of covered workers have a general annual deductible for single coverage that must be met before most services are paid for by the plan.** Since 2010, there has also been a sharp increase in both the percentage of workers on health plans with deductibles—which require members to pay a certain amount toward their care before the plan starts paying—and the size of those deductibles. The result has been a 67-percent rise in deductibles (for single coverage) since 2010, far outpacing not only the 24-percent growth in premiums, but also the 10-percent growth in workers’ wages and 9-percent rise in inflation.
In recent years, the increase in U..S. health costs has in fact slowed down. But the slowdown has been invisible to American workers, who have been forced to pay much higher premiums and deductibles in order to get access to healthcare for themselves and their families.
*Fifty-seven percent of firms offer health benefits to at least some of their employees, covering about 63 percent workers at those firms.
**Even workers without a general annual deductible often face other types of cost sharing when they use services, such as copayments or coinsurance for office visits and hospitalizations, and when they purchase prescription drugs.