What would happen if a preacher stopped preaching to the choir? Well, if the story of Carlton Pearson is any indication, the choir stops listening.
If you’re not familiar with Carlton Pearson, he was once an evangelical superstar. A jet-setting friend of U.S. presidents, a familiar face on TV, a preacher to thousands every Sunday at his Tulsa mega-church. A church with annual offerings in the millions of dollars. Until he wondered aloud whether God might not be as vengeful as we’ve been taught to believe and that there may be no Hell. That little departure from the orthodoxy sent his flock running, leaving him with but handful of stragglers.
As Mr. Pearson explained it, “People don’t follow preachers as much as they follow popularity. I always knew that. And as soon as I quit preaching what was popular, the people were gone.”
More simply put, fear of Satan can pack a church. No fear, no following.
So why do I bring this up? Because we have a cadre of preachers dispensing unbending orthodoxy to true believers, pointing to devils lurking around every bend. They’re the devils known as Obama and Boehner, bankers and immigrants, liberals and conservatives, Republicans and Democrats.
The preachers are Limbaugh, Olberman, Hannity, Maddow. We may think they are teaching us the truth, when in reality they are feeding us what we want to hear – and the minute they stop, they know we’ll go running. So they keep feeding it to us. And we continue to not only lap it up, but regurgitate it as gospel. Worse, we dismiss any dissenting opinion as blasphemy.
The day will come when one of two things will happen - we decide the shepherds are selling us a bill of goods and turn them off, or we end up buying that bill of goods, in which case we will discover that hell is not only real, but well deserved.
12/16/2010
11/12/2010
Time to Stop Passing the Buck on Deficits
Come on, America, we’re better than this. After taking time out Thursday to honor veterans for their willingness to make the ultimate sacrifice, we promptly returned to doing what we do best, which is griping about being asked to make any sacrifice whatsoever.
The target of our ire was the bipartisan commission draft proposal calling on sacrifice from all to reduce our nation’s debt, which prompted people of every economic and political persuasion to argue someone else should feel the pain. It’s only natural that a society that has become so accustomed to blaming others for all our ills would expect that others should carry the burden of correcting them.
What we fail to see, however, is that we are all complicit to some degree for our challenges. From bankers more concerned about this year’s bonus than next year’s solvency to borrowers who took on debt they could not repay. From taxpayers who elect to starve schools of funds needed to educate a competitive workforce to students who don’t make the most of the educational opportunities afforded them. From a Congress that forces unwanted weapons upon the military to a public that demands their representatives bring home the bacon. The list is endless.
Our Veteran’s Day observation recognized a dwindling number of WWII vets. They experienced the hardship of the Great Depression as children and were rewarded by having to fight the ugliest war mankind has ever seen. They, and those who supported them, earned their title of the Greatest Generation through universal sacrifice, never asking someone else to shoulder the burden. We can honor their memory by putting away our fingers of blame, looking in the mirror, and asking what we can do to ensure America’s best days lay ahead. It’s our time and our responsibility.
The target of our ire was the bipartisan commission draft proposal calling on sacrifice from all to reduce our nation’s debt, which prompted people of every economic and political persuasion to argue someone else should feel the pain. It’s only natural that a society that has become so accustomed to blaming others for all our ills would expect that others should carry the burden of correcting them.
What we fail to see, however, is that we are all complicit to some degree for our challenges. From bankers more concerned about this year’s bonus than next year’s solvency to borrowers who took on debt they could not repay. From taxpayers who elect to starve schools of funds needed to educate a competitive workforce to students who don’t make the most of the educational opportunities afforded them. From a Congress that forces unwanted weapons upon the military to a public that demands their representatives bring home the bacon. The list is endless.
Our Veteran’s Day observation recognized a dwindling number of WWII vets. They experienced the hardship of the Great Depression as children and were rewarded by having to fight the ugliest war mankind has ever seen. They, and those who supported them, earned their title of the Greatest Generation through universal sacrifice, never asking someone else to shoulder the burden. We can honor their memory by putting away our fingers of blame, looking in the mirror, and asking what we can do to ensure America’s best days lay ahead. It’s our time and our responsibility.
10/10/2010
Tackle Cost Before Coverage
There are two health care crises in the U.S., one involving cost, the other coverage. It doesn't take a great deal of logic to realize that tackling the former will go a long way in addressing the latter. Unfortunately, Congress decided to focus on coverage, largely because it's much easier to offer people something they want (health insurance) than fight the entrenched interests who benefit from the outrageous cost of health care in the U.S.
Of course, to address cost, we must first understand why it costs so much here compared to the rest of the world (interesting tidbit - the U.S. government spends more per capita on health care than does Canada - and Canada has universal coverage). There are, of course, the usual suspects of malpractice suits, the defensive medicine in response, the use of emergency rooms for routine care and whatnot. But this represents little more than a few percent of our $2.2 trillion health care tab.
No, the reason for our outrageous costs can be summed up in one word: demand. We want health care and we've got the money to pay for it. It's a costly combination.
Of course, to address cost, we must first understand why it costs so much here compared to the rest of the world (interesting tidbit - the U.S. government spends more per capita on health care than does Canada - and Canada has universal coverage). There are, of course, the usual suspects of malpractice suits, the defensive medicine in response, the use of emergency rooms for routine care and whatnot. But this represents little more than a few percent of our $2.2 trillion health care tab.
No, the reason for our outrageous costs can be summed up in one word: demand. We want health care and we've got the money to pay for it. It's a costly combination.
2/25/2010
The Challenges the ACA Needs to Address
[Note: This is a response I gave my sister regarding a piece she wrote for her local paper on the proposed ACA legislation]
I just now read your health care piece on the currently proposed healthcare reform. It's very good and I agree wholeheartedly that the legislation focuses on just half the problem (coverage) and ignored the problem that needs to be addressed first (cost). Fixing the latter will go a long way in fixing the former. Still, there are a couple of challenges that are very difficult to address from a purely free-market approach.
The first is that with every type of insurance, the more that risk is spread, the lower the cost of coverage. Imagine you ran a lottery that guaranteed a million dollar payout if the winning number is drawn, regardless of how many people played. You wouldn't sell tickets for a dollar if only 1,000 people played - the risk of someone winning might be tiny, but you'd go broke if you had to pay out. You'd have to charge $1,000 per ticket just to ensure you broke even. But if two million people played, you could charge a dollar, pay the prize and make a million for yourself (nice gig if you can get it).
Now, change that to health insurance. If you agree to insure one person against illness, you might be lucky and get a person who never gets sick - or you might get someone with diabetes who is going to be taking medication for life, suffer potential circulatory problems, blindness, amputations and more. The cost can be hundreds of thousands of dollars. So how much are you going to charge to cover that one person? You might not charge much if they're healthy, but you're still going to charge plenty to cover your risk. You are going to charge even more if they're at risk - a lot more because you need to cover your risk of payout. But if you are insuring a thousand people, the risk is spread and you can charge everyone far less. Perhaps more than you would the single, healthy person, but still less than the single at-risk person.
Therein lies challenge #1. When a company or individual signs up for health insurance, the insurance company considers them their own individual group. So an individual is a group of one, a small business a group of fifteen (or however many are covered), General Electric a group of 200,000. In each case, the insurance company will charge premiums to cover the cost of caring for the individuals in the group. If a GE employee gets sick, the cost is spread among 200,000 premiums. If a small-business employee gets sick, it's spread over 15 premiums. If the individual gets sick, the individual will eventually pay the whole load (I once hired a person whose husband had heart disease - that one hire increased my premiums $24,000/year. Since I only covered 12 employees, that worked out to $2,000 per employee per year. They couldn't afford to pick up that tab, so I had to eat it).
So let's say individuals band together and form their own group. They get better rates. Eventually, one member of the group gets sick and premiums go up 20% But then another insurance company approaches one of the healthy people in the group and tells them they can get coverage individually for the original premium - so the person bolts the group, driving up premiums even more for those who remain in the group. This makes individual coverage attractive for even more people in the group, so they also bolt and the cycle repeats. Eventually, the group is down to just the sick folks and they can't afford the coverage. So the question becomes how can we build groups that healthy people won't bolt? Or, if we do allow them to bolt, how do we keep premiums low for those who remain? Any attempt to address the latter will violate all the rules of actuarial risk taking, unless we somehow subsidize the remaining people.
Challenge #2 involves those healthy people who choose not to buy insurance. Sure, they may be healthy now, but what happens when they get sick? We don't turn them away, so in effect, they're covered though they are not paying. My brother-in-law is a perfect example. He was young, healthy and uninsured when he had a serious auto accident that required Air Care to the local trauma hospital, where he was in critical condition for days. His hospital bill came to $48,000. His dad negotiated that down to $4,800, which my brother-in-law paid over several years. So who paid the other $43,200? Those of us with health insurance. In effect, the uninsured are technically part of everyone else's "group", but they are largely getting a free ride. Is that fair? Should they be required to contribute to covering potentially catastrophic illness, or should we just say tough luck and refuse them treatment? You know how that would play on the evening news ("Uninsured six-year old allowed to die after getting hit by car. Film at 11").
These aren't challenges that are easily fixed - or even possible to fix - through purely free-market solutions. In a column years ago, I suggested a psuedo-public option. Allow small businesses and individuals to buy into the health insurance plan available to federal employees. These plans are private insurance plans, so it maintains a free-market component. But they also cover millions of people who are not going to bolt the group, so the risk is spread widely. The fact that it involves government employees scares people, but it's not a solution I'm ready dismiss out-of-hand. And I do believe that people who choose not to be insured should either be required to get basic insurance to cover emergency catastrophic care or be made to pay a tax that funds a catastrophic care program. Doing so will shift the burden from those who are effectively paying for that coverage (us) to those who are getting a free ride. The alternative is to tell them tough luck when they need help, and I'm not prepared to do that.
It's an incredibly complex problem. Still, it doesn’t need an equally complex solution. I think it could be fixed with a 20-page bill, not a 1,000+ page one. Unfortunately, that's not how our government thinks.
I just now read your health care piece on the currently proposed healthcare reform. It's very good and I agree wholeheartedly that the legislation focuses on just half the problem (coverage) and ignored the problem that needs to be addressed first (cost). Fixing the latter will go a long way in fixing the former. Still, there are a couple of challenges that are very difficult to address from a purely free-market approach.
The first is that with every type of insurance, the more that risk is spread, the lower the cost of coverage. Imagine you ran a lottery that guaranteed a million dollar payout if the winning number is drawn, regardless of how many people played. You wouldn't sell tickets for a dollar if only 1,000 people played - the risk of someone winning might be tiny, but you'd go broke if you had to pay out. You'd have to charge $1,000 per ticket just to ensure you broke even. But if two million people played, you could charge a dollar, pay the prize and make a million for yourself (nice gig if you can get it).
Now, change that to health insurance. If you agree to insure one person against illness, you might be lucky and get a person who never gets sick - or you might get someone with diabetes who is going to be taking medication for life, suffer potential circulatory problems, blindness, amputations and more. The cost can be hundreds of thousands of dollars. So how much are you going to charge to cover that one person? You might not charge much if they're healthy, but you're still going to charge plenty to cover your risk. You are going to charge even more if they're at risk - a lot more because you need to cover your risk of payout. But if you are insuring a thousand people, the risk is spread and you can charge everyone far less. Perhaps more than you would the single, healthy person, but still less than the single at-risk person.
Therein lies challenge #1. When a company or individual signs up for health insurance, the insurance company considers them their own individual group. So an individual is a group of one, a small business a group of fifteen (or however many are covered), General Electric a group of 200,000. In each case, the insurance company will charge premiums to cover the cost of caring for the individuals in the group. If a GE employee gets sick, the cost is spread among 200,000 premiums. If a small-business employee gets sick, it's spread over 15 premiums. If the individual gets sick, the individual will eventually pay the whole load (I once hired a person whose husband had heart disease - that one hire increased my premiums $24,000/year. Since I only covered 12 employees, that worked out to $2,000 per employee per year. They couldn't afford to pick up that tab, so I had to eat it).
So let's say individuals band together and form their own group. They get better rates. Eventually, one member of the group gets sick and premiums go up 20% But then another insurance company approaches one of the healthy people in the group and tells them they can get coverage individually for the original premium - so the person bolts the group, driving up premiums even more for those who remain in the group. This makes individual coverage attractive for even more people in the group, so they also bolt and the cycle repeats. Eventually, the group is down to just the sick folks and they can't afford the coverage. So the question becomes how can we build groups that healthy people won't bolt? Or, if we do allow them to bolt, how do we keep premiums low for those who remain? Any attempt to address the latter will violate all the rules of actuarial risk taking, unless we somehow subsidize the remaining people.
Challenge #2 involves those healthy people who choose not to buy insurance. Sure, they may be healthy now, but what happens when they get sick? We don't turn them away, so in effect, they're covered though they are not paying. My brother-in-law is a perfect example. He was young, healthy and uninsured when he had a serious auto accident that required Air Care to the local trauma hospital, where he was in critical condition for days. His hospital bill came to $48,000. His dad negotiated that down to $4,800, which my brother-in-law paid over several years. So who paid the other $43,200? Those of us with health insurance. In effect, the uninsured are technically part of everyone else's "group", but they are largely getting a free ride. Is that fair? Should they be required to contribute to covering potentially catastrophic illness, or should we just say tough luck and refuse them treatment? You know how that would play on the evening news ("Uninsured six-year old allowed to die after getting hit by car. Film at 11").
These aren't challenges that are easily fixed - or even possible to fix - through purely free-market solutions. In a column years ago, I suggested a psuedo-public option. Allow small businesses and individuals to buy into the health insurance plan available to federal employees. These plans are private insurance plans, so it maintains a free-market component. But they also cover millions of people who are not going to bolt the group, so the risk is spread widely. The fact that it involves government employees scares people, but it's not a solution I'm ready dismiss out-of-hand. And I do believe that people who choose not to be insured should either be required to get basic insurance to cover emergency catastrophic care or be made to pay a tax that funds a catastrophic care program. Doing so will shift the burden from those who are effectively paying for that coverage (us) to those who are getting a free ride. The alternative is to tell them tough luck when they need help, and I'm not prepared to do that.
It's an incredibly complex problem. Still, it doesn’t need an equally complex solution. I think it could be fixed with a 20-page bill, not a 1,000+ page one. Unfortunately, that's not how our government thinks.
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