Thursday, December 31, 2009

Karl Rove, I agree with you *vomits*

by Cylinsier

In one of today's political ticker articles, CNN reports on some of Karl Rove's suggested New Year's Resolutions for Barack Obama and his administration. Shockingly, they are appropriate and far from partisan. Maybe Rove's divorce has caused him to rethink his life. Or maybe I'm just becoming more conservative...nah, Rove must have rethought his life.

From CNN's story, the first suggestion is:

Mr. Obama should work on his habit of leaving a room of people with deeply divided opinions thinking he agrees with all of them. That leads to disagreements over essential issues, like the meaning of his pledge to begin withdrawal from Afghanistan in 2011 and the nature of the new military mission there.

Wow. Very insightful, you fat bastard. I agree, President Obama's biggest mistakes so far have often resulted from a lack of initiative in taking sides. Obama needs to tell people where he stands and stop trying to please everyone. Just please the people who voted for you.

Rove on Biden:

Every time he opens his mouth, the West Wing staff uses him to make the president look good by comparison.

Well, yeah. But maybe that's part of the plan! No, seriously, I agree again. Biden has been much better of late, though.

Back to the administration in general:

Why not resolve to have a few less "historic" moments? How many can one president really have, anyway? A little more grace toward his predecessor would help him, as would less TV time. He is wearing out his welcome and his speechwriters—judging by the quality of their work lately.

There's stink of some partisan sniping here, but a grain of truth as well. I get what Rove is saying. There does seem to be a preoccupation with setting this administration up to be the best ever. How about we just get shit done and let history decide how good it was? But fuck Rove on the "wearing out his welcome" comment. He's the President, bitch. Get over it. And "less TV time?" Really? Consider the age we live in.

On Desiree Rogers, who is in charge of White House guests:

[She] should take a lead from Santa Clause and make her list and check it the White House gates.

El oh El. You rotund fuck. I agree again, though. The biggest embarrassment to this administration so far, in MY HUMBLE opinion, is those clowns who got through the gate at that party. Are you shitting me? Secret Service must have been on crack at the time.

So what does this mean, me agreeing with Karl Rove? Did hell freeze over? Maybe, but neither he nor I believe in hell. Whatever it is, let's put partisan politics aside and admit there is always room for improvement. Thank you Karl Rove for saying some stuff that lightened my day a little. Now go jump off a cliff.

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Tuesday, December 29, 2009

The healthcare battle nears conclusion, but who are the winners?

by Cylinsier

The highest hurdles have been cleared. Both houses of Congress have passed their mangled, well-intentioned versions of health reform, each resembling a good plan in some ways and yet each bearing the scars of political machinations. The final step is cobbling the two together into something both houses will agree on, and then sending it on to the President for it to become official.

There are a lot of people, on both sides of the aisle, calling for this thing to be totally dismantled. They want a fresh start, and I don't totally disagree with them. There is enough in these bills to dislike that I too would like to take it back to the drawing board, but that is unrealistic at this point. One way or the other, there seems to be little if any chance that the Democratic majorities will remain the same in either house of Congress after next year's elections. Considering the paper thin margins by which each bill passed, and the nauseatingly partisan politics employed by the right and conservative left in attempting to stonewall this bill, there is no second chance. If this bill is tossed, then we have to be okay with that being all she wrote on this issue until the system collapses, because nothing is going to be done about it sooner.

There are also a lot of good reasons to see this bill passed. Admittedly, some are going to be of the petty nature; I can't be the only one that allows himself a bit of satisfaction in thinking about how hard the right has fought on their platform of lies and deceit, only to still see a bill passed (wishful thinking in many ways; the GOP is most likely secretly patting themselves on the back for doing so good a job of neutering the bill). But at the end of the day, whether or not this bill is signed and passed should depend on whether or not it improves the system in any way for the people of this country. Nothing else should play into it.

To determine whether or not the bill is an improvement, we need to understand it. It is my opinion that the final product is going to be most similar to the Senate version, as the House is already signaling making concessions to favor it. So what does the Senate version look like? According to Reuters, the bill includes:

  • a mandate for US citizens to purchase health insurance.
  • Federal subsidies for individuals up to 400 percent of the federal poverty line.
  • Federal tax benefits for small businesses.
  • Penalties for employers who do not provide plans to employees when said employees tap into subsidies to purchase coverage.
  • the creation of State-based insurance exchanges.
  • contracting between OPM (which overseas federal insurance plans) and private insurers to create non-profit plans available in the exchanges.
  • a medicaid increase in all states who's Senator didn't play mercenary with their vote.
  • the removal of the preexisting conditions copout.
  • the removal of higher charges based on gender, health history or employment.
  • the removal of insurers' ability to drop people when they get sick.
  • the removal of lifetime limits on coverage.
  • requiring insurers to cover preventative care.
  • a provision to streamline paperwork as well as other measures to reduce overhead costs.

Really, the House version isn't terribly different in most ways; its just some of the numbers that differ. The big difference is the public option, which existed in the House version, but which seems dead now. There was also a medicare increase floating around, but Senator Lieberman killed that.

So why are the above things good? Well, the mandate may not make people jump for joy, but its important to understand why that is included before being critical of it. If you remove insurers' ability to deny coverage because of preexisting conditions (and you should), but do not mandate insurance, then you will have a huge number of people who don't buy insurance until right after they get sick, then get a policy quick to cover costs, then cancel. The system can support that kind of use for approximately 3 seconds before succumbing. The mandate is probably the least popular part of the bill excluding debates of cost, but it has to be there or the whole thing falls apart.

The rest should be pretty straightforward unless you're a total asshole. There's nothing there that you can argue doesn't benefit a large number of people. So let's draw the line in the sand right here and make it crystal clear: the people that are against this bill have one argument, and that is cost. Sure, these are all good things, but how much of my paycheck do I have to fork over for it? Well, I don't think we're truly going to know that until the deal is done. Note that most of the above benefits don't kick in until 2014, so we'll sure have plenty more time to talk about it. But to say whether or not the cost outweighs the benefits, we're just going to have to wait and see.

I can tell you that the cost would have been nil, or even negative, if some people had just stopped bitching early on and let us have a public option or single payer, but there was too much money in politicians' back pockets and too much propaganda on Fox News for that to happen. Really, if we get boned by this bill, we have no one to blame but ourselves; for being gullible, for not putting the right people in office, and for succumbing to our own arrogance and selfishness. In a way, this bill failing might be a good thing for us. Americans seem to have a hard time learning by any means but the hard way nowadays.

But the reason I think this bill needs to be passed is twofold: first, I do firmly believe that more people will benefit from this bill than people will suffer from costs. I'm not saying there won't be a few people that see prices go up without a change in quality of coverage. Actually, most people will probably see no change at all. But the people that see their quality of life improve because of this bill will outweigh, probably by far, the people that see any kind of degradation. That's enough reason to support it for me. It seems everyone in support of this bill and reform in general also views the issue that way, while everyone against it seems to think only of how it will affect them personally. Morally condescending comments about being selfish pricks aside, the world and specifically this country does not run on the whims of a select few, regardless of how much money you have or your class status. The needs of the many outweigh that of the few. That's not an argument on what philosophy everyone should subscribe to, that's a law of nature.

The second reason I support this bill's passage is because I firmly believe that the people of this country, when it comes down to brass tacks, have just enough collective intelligence to recognize that any shortcomings of this bill are a result of it not going far enough as opposed to too far. If we start talking about making changes to this bill in a few years, it will be a move towards single payer, not away. I believe that because that is how things have always worked in this country. Just look at Civil Rights. It didn't happen overnight. There were baby steps, in some cases frustratingly and dishearteningly slow steps, towards something that actually worked the way it was supposed to. We might have had a shot at changing this overnight, but we missed it. That's not a reason to stand still for another decade or so. We need to take the first step to complete the journey. Comprehensive reform is still a ways off, but if this bill passes, it'll be just a bit closer.

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Tuesday, December 22, 2009

House Dem to Switch to Republican

by Cylinsier

Per CNN's political ticker, Parker Griffith of Alabama will switch from Democrat to Republican by the time he runs for reelection next year. If you were wondering, yes, he was a Blue Dog.

I think we're all thinking the same thing here, and that is, "Really? Alabama? You were a Congressman from Alabama and you didn't think we all didn't already know you were a Republican?"

I mean, shit, he was a Blue Dog from the bible belt. Kind of like when Lance Bass came out of the closet. Everyone just nodded and went on with their day. But I do have to give Griffith some credit. At least you came out. The other Blue Dogs still want to pretend they are Democrats. Kudos for wearing your true colors with pride.

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Thursday, December 17, 2009

More Alan Grayson Fireworks

By Ellipses

Grayson starts the shame-game of rattling off death stats for specific elected officials at about the 15:00 mark. It's not really a secret if I were able to, I'd cut myself in half so that part of me could live and vote in Al Franken's district and part of me could live and vote in Alan Grayson's district.

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Wednesday, December 16, 2009

Here's what happened in the Senate today

By Ellipses

A meaningful amendment is actually proposed... and what happens? Coburn shits on it, mashes it into the carpet with his feet, and lights it on fire.

Coburn requires that Sanders' single payer amendment be read in its entirety (767 pages). The clerk reads it for a few hours and then Sanders withdraws his amendment and proceeds to use his 30 minutes to say "Fuck you, fuck you, fuck you, fuck you, you're cool, fuck you, fuck you, I'm out!"

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Tuesday, December 15, 2009

Dick Armey really is a brigade of cocks

By Ellipses

And another charmer by America's favorite lesbian:

Visit for breaking news, world news, and news about the economy

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Franken Flogs Thune

By Ellipses

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Monday, December 14, 2009

Bend over America, Lieberman isn't done

by Cylinsier

As reported by CNN, it seems that Joey L has had a chat with his wife about how expanding Medicare to cover those 55 and older who do not have insurance will hurt their income from her health care lobbying. After some soul searching, they've decided that they aren't willing to risk that income, and that fucking Americans over is a much more palatable course of action.

Seriously, who is this guy kidding? Just put the R next to your name now and quit being coy. The soon-to-be ex-senator's paper-thin excuse (that's a lot of hyphens) is, and I quote, "We don't need to keep adding on to the back of this horse until the horse breaks down and we get nothing done." Gee, that sounds an awful lot like the argument in favor of reforming the current health care system. You know, the one that's going to collapse under its own weight in, I don't know, about ten years. Which would serve us right at this point. I kind of hope we don't do anything and it comes back to bite us in the ass. We obviously need to learn the hard way.

Let's first establish that expanding Medicare does NOT add things on the back of this so-called horse. The reason most of us pay so much money for health insurance is because you are paying premiums to cover the risk of your entire insurance pool. Yes, that means those of us, like me, who are comparatively young and healthy, are paying higher premiums than we need to to cover the asses of the just-shy-of-medicare aged folks who may or may not be getting their arteries scraped next week on our dime. Now, not even most of those will be eligible for Medicare because you can't get it at 55 unless you are uninsured, so a lot won't even change. All it does is take those high riskers on no or unaffordable plans and give them a new option. Its such a vanilla solution that you have to be a total prick to oppose it. However, theoretically, it puts the high risk patients on a plan that already exists to cover high risk patients and provides incentive for private insurers to lower the rates for the rest of us. Why would they follow through on that? I don't know, they probably won't because they like to make money, but that's the theory. Will it raise the cost of Medicare? Yes, in theory, by a very small margin that should by all rights be offset by the huge savings the private insurers will more likely than not try to pocket instead of passing back to us. So really, Lieberman is right, but not because the plan changes too much. He's right because it doesn't do enough.

Basically, its a plan that plays right into the Republicans' hands; it allows the private insurers a chance to slip even higher profits by us. And they STILL won't vote for it. That's the level of assholery we're dealing with.

Of course, in the long run, it would be beneficial because its one decade's worth of patients closer to covering all of us in a single payer system, and maybe that's what scares them. Another part of this current bill increases the bar for who can buy Medicaid. Yet another increases the age of dependents who can stay on their parents' plans to something absurd like 30 (I guess accounting for the WoW crowd who live in their parents' offense cause I'm a gamer too). And even another aspect had something to do with a government agency designed to regulate all this. So yeah, it does have its sneaky socialist aspects which can seem scary to old white men who remember when you were supposed to shoot anyone who claimed to be a socialist, the irony of them subsisting almost entirely on social programs at that age notwithstanding.

But the GOP isn't going to be happy until nothing at all gets passed, and they have Lieberman playing the role of inside man in their scheme now. It calls to mind the saying, "beware of the wounded animal." The GOP is cowering in the corner on three legs, but I'll be damned if you can't get within 20 feet of them without getting mauled right now.

As a quick aside, I love Mitch McConnell's quote in the CNN story on the bill: "We do not believe this bill, this nearly 2,100-page monstrosity, is real health care reform." Yeah, and people did not believe the world was round 600 years ago. Its like every time you turn around, the bill has grown another handful of pages all on its own, despite the fact that the Dems make huge cuts to it constantly. I'm setting the over-under of the bill's length by January 1st at 2,300 pages. I'll take the over.

So what's the end game here? Do we get a bill or not? And is it worth it? Well, we're going to get something, considering the Democrats are set on cutting as much of the bill away as it takes to get the needed votes. However, I think its safe to assume that it will not make things better at this point, and in fact might make them worse in the immediate future. But that's okay with me as long as there is a long term outcome that will be favorable. We have to face a fact here, and that fact is there is going to be a difficult period of time ahead for Americans and its going to last about 20 to 30 years. See, when the last of the baby boomers hit retirement age, we're going to be in the unenviable position of going through a couple of decades where the working class is outnumbered by the retired class. This isn't the boomers' fault. Its not like they all got together and said, "hey, let's all get born together so we can fuck the system for our kids and grandkids down the road." But that's what's going to happen. There is no model for a system that can produce more energy than it consumes; we are going to be faced with government programs that hemorrhage money for a while. That doesn't mean the system is broken. It just means the burden is unbalanced.

There will be people who try to imply that the system is broken and will try to have it demolished at that time, and it will be important to avoid that temptation. Its very easy to want to do what benefits you at the expense of future generations, and very difficult to inconvenience yourself for the benefit of future generations, but it is the latter that we must strive for. Its going to be a hard sell. And really, its starting right now. We have a situation where we need to secure the health of our citizens not just now, but for generations ahead, and the opponents are the shortsighted among us. They are those that do not consider or care about those that will come after they die. They care only about themselves. And that's what it comes down to; like all past arguments over government programs and all future ones to come, the health care debate is a fight between doing what is easy and what is right. However, we cannot do both.

In Congress, the motivations are more likely about doing what you think your voters want; let's not pretend that we have close to 60 heroes working for us there (or close to 40 if you are on the other side). They might be generally decent people, but they are political mercenaries at the end of the day. That's just how the system works. That's why, in spite of what the libertarian and anarchists crowds say, we must remember that we as voters do ultimately control what our country does and does not do; we control it by telling our congressmen and congresswomen what to do. If you voted in the last election and you write a letter to your representation, and everyone else does the same, they will listen. They have to, or else they lose their jobs. They are our employees and it works. If you live in Connecticut, where ever other member of Congress from your state does not have their heads buried up their asses, send Lieberman a note and remind him who his bosses are. The rest of the country will thank you for it eventually.

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Saturday, December 12, 2009

Friday, December 11, 2009

Glenn Beck Pure Gold

by Cylinsier

Oh, this must be why Glenn Beck's show is 20% lunatic ravings and 80% gold commercials. Gotta hold on to that one last sponsor while you can!

The Daily Show With Jon StewartMon - Thurs 11p / 10c
Beck - Not So Mellow Gold
Daily Show
Full Episodes
Political HumorHealth Care Crisis

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Wednesday, December 9, 2009

Grayson Tells Cheney to "STFU"

By Ellipses

This is turning out to be a good week... so far, Rachel Maddow has torn a "Cure the Gay" dude a new asshole and Alan Grayson has advised Dick Cheney to shut the fuck up. If I can get Al Franken to call Glenn Beck a pudding-dicked taint-licker, it will be somewhat of a holy trinity :-)

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This is why the GOP is irrelevant

From Mitch McConnell's Internetz (Notice the dates):

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Tuesday, December 8, 2009

Rachel Maddow is my Favorite Lesbian

By Ellipses

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Tim Murphy Represents the Town of Selfish, Pennsylvania. Population: about 1,200

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By Ellipses

Call it chaos theory, 6 degrees of separation, or simply coincidence. A spur-of-the-moment phone call this past summer resulted in the most entertaining piece of junk mail I've received in a long time.

You may remember the video of a guy chasing congressmen and senators around D.C. trying to elicit a firm yay or nay response to the "birther" question. Some expressed "concerns" that the birthers "have a point," while others bolted in the opposite direction or hung out in a book store for an inordinately long period of time. That last one was Tim Murphy, republican congressman representing the 18th district of Pennsylvania.

Since I didn't have shit-else to do at the time, I gave Mr. Murphy's offices a call (both the D.C. one and his home base office in Upper St. Clair). I spoke to a nice intern named Andrew at the USC office. I asked what Mr. Murphy's official position was on the birther issue and was in turn asked what I thought of the issue. Naturally, I asked if my response would determine Mr. Murphy's position and was told that Andrew could not comment explicitly on Mr. Murphy's position, but he was interested in knowing what his constituency thought of it. I call bullshit, but I'm not going to take this up with an intern. Anyway, I provide the 411 on my identities and get added to a mailing list, apparently.

And on Friday, that tree bore big, delicious fruit!

I feel almost privileged to be the recipient of the 4-color folio-o-horseshit that Mr. Murphy no doubt deposited into my mailbox DIRECTLY from his putrid, gaping anus while balanced precariously out the passenger's side window of his sedan: The RESULTS of his 2009 Healthcare Survey!

So, what do my fellow Keystoners have to say about doctorin' in Amurka?

The mailer I received has some charted highlights, but the pertinent part of this is the url to view the "entire survey and more detailed information."

The .pdf on Murphy's website is what I am using, rather than the bits and pieces in the mailer.

The first major thing I notice is that there is no mention of sample size, level or method of stratification, survey methodology such as survey format, method of data collection, margin of error, date of data collection, or an indication of whether the sample was representative, and if so, representative of what population?

The personal message from Mr. Murphy indicates that "thousands of people" responded to the survey. To put that in perspective, Nielson research extrapolates Pittsburgh DMA viewing statistics from a sample of fewer than 300 households in the Tri-State area. To create a database representative of census demographics for the Pittsburgh Metro Area with a margin of error of +/- 3%, a sample of 1,000 individuals is sufficient. "Thousands" of respondents, if stratafied and representative, would be severe overkill for accuracy of representing the 18th congressional district.

"Similar to the national average, 97% of respondents in the 18th Congressional District do have health insurance."

The word "similar" may have debatable meanings, but when I look at the various numbers on the uninsured in America, 30-45 million is a FAR CRY from 3% of the total population. The national average is more like 10-15%.

Pennsylvania, on the whole, has about 13% of its residents uninsured. Mr. Murphy represents an older, more affluent district, but goddamn! 97%? That's Massachusetts-style coverage right there! I won't call bullshit on this, though, because I can't find stats on health insurance coverage saturation by congressional district. If anyone else knows of a source, please chime in.

Of this near-fully insured population, 29% purchase their own insurance, 52% have employer-sponsored insurance, and 37% have medicaid or medicare. Obviously, there is some overlap in supplemental policies in addition to possessing government-run insurance.

85.8% of respondents rate their coverage as excellent or good, while only 13.2% rate it as fair or poor. On the mailer, the chart shows 1% rating their coverage as "Other." Normally, with a rating question such as this, you would either use a scale of 1-4, 1-5, 1-7, or 1-10, with an option for "don't know." "Other" wouldn't even be a possible response.

40% of respondents "believe America's current healthcare system is not broken." Apparently, 40% of Mr. Murphy's constituency live under rocks. Luckily, 44% believe that it IS broken... and 16% probably can't figure out into which hole they should stick their food.

1 out of 3 respondents think health care should be a top priority of the president and congress. 29% believe it "should be made a medium and low priority."

85% of respondents saw their health care costs increase over the past year. Then, there is this interesting statement: "What causes the increase? This year $2.5 trillion will be spent in the U.S. healthcare system, of which $800 billion to $1 trillion is wasted or misused." First, is that figure DIFFERENT from last year? Has there been an increase, in the last 12 months, in the amount that was wasted or misused? If not... if that figure is static, then why the increase? If 800 billion dollars was wasted last year and 800 billion dollars will be wasted this year, why did health care costs increase? Secondly, isn't 800 billion dollars within the ballpark of the CBO's cost estimate for the most recent incarnation of the public option? Why isn't Mr. Murphy advocating for a public option with a mandate that it be financed in part through savings extracted from eliminating waste and misuse?

More than 58% of respondents oppose the idea of the government requiring an individual to buy coverage. 58%... of a group of people that is 97% insured. So, just about every one of these folks has insurance, but they don't want the government to require all those uninsured people to have coverage... which is exactly the reason that their costs have increased (not because of waste and misuse).

60% of people think that people on medicaid should be able to buy a private policy. 56% of people think people on medicaid should be given tax credits to buy insurance. I'm just wondering... how many people on medicaid pay enough in taxes that a credit would be enough to cover the cost of insurance? Policies can easily cost 500 dollars a month for a young, healthy person. How many people who are eligible for medicaid pay 6,000 dollars a year in taxes?

Bar graph number 10 appears to be constructed with n-size on the y axis, that is, the actual population of respondents for each question. It looks like about 1,200 respondents, total, responding to that question. Of those, 400 (35% of 1,500) cited "high out of pocket costs" as the main concern with their current health insurance plan. The "other" bar is at about 375 respondents (31%). Within the "other" response, at least 7.75% of responses could have been grouped into "high out of pocket costs" since they are responses like "co-pays too high." This puts "cost" as a primary concern for about 43% of respondents.

Graph #14 offers some interesting insight into the perspective of those who responded to the survey. 66% of respondents say that people on medicaid should have the option of buying private insurance. Doesn't everyone have the option to buy private insurance? Can't every one of us go onto Ætna's, or BC/BS's, or Cigna's website and buy a policy? Isn't the reason that people are on Medicaid (and yes, it's medicAID that is mentioned in the question text) that they can't afford private insurance and they don't get affordable insurance from their employer? Again with the poor people!

Graph #16 just evokes a question of semantics. Should people be allowed to purchase policies from different states? 70% say yes and I have no problem with that. My question, though, is this: If an insurance exchange is set up and various insurers can put a low cost plan into the exchange (along with a public option)... if I bought insurance through that exchange, would I only be able to buy insurance from a Pennsylvania insurer? I doubt it. I would expect the exchange to be a central repository of insurance products, which would be offered to all Americans, regardless of what state they live in.

After the aforementioned graphs, we have a string of questions that illustrate how unwilling people are to pay any taxes for reform.
  • 76% don't want to pay a national sales tax
  • 83% don't want higher payroll taxes
  • 91% don't want higher taxes for married people
  • 93% don't want a tax on their mortgage
  • 76% don't want a cell phone tax
  • 56% don't want a junk food tax
  • 54% don't want an alcohol tax
  • 92% don't want a tax on charitable donations
  • 86% don't want a higher income tax
  • 56% don't want a tax on employers who DON'T offer insurance
  • 91% don't want a tax on their health insurance
  • 62% don't want to tax people who DON'T pay for their insurance
  • 95% don't want a tax on health care services
  • 84% don't want a tax on health care savings accounts
  • 94% don't want a tax on prescription drugs
  • 72% don't want an oil refinery tax
  • 87% don't want a power company tax
  • 52% don't want taxes on US companies who do business overseas
  • 89% don't want a tax on dividend income
  • 78% don't want a tax on capital gains
  • 93% don't want an inheritance tax

A couple of "poor man cross tabbing" observations:
48% of people DO want to tax companies who "do business overseas" but only 11% want a tax on dividends and 22% want a tax on capital gains. So, some people want to tax the multinationals on the front end but presumably don't want to decrease their own personal income from those companies. I wonder if they realize that "doing business overseas" doesn't actually mean "sending jobs to China."

More people are in favor of "affect me now" taxes (income, sales, payroll, cell phone, investment) than are in favor of an inheritance tax that would be used to pay for health care. Now, I am pretty much opposed to inheritance taxes on principle, but it seems that some respondents are more concerned with what happens to your material wealth after you're dead than they are with your present-day income potential. Maybe if these folks had more of a functionalist perspective, we could get beyond the arguments of abstraction.

38% of respondents want to tax people who don't pay for their insurance. This is where some dialogue with the Murphy camp would come in handy. Who are these people? Are we talking about veterans and old people or are we talking about poor people on medicaid again? I mean, do 1 out of 3 people want a poor tax to reduce the cost of their own health insurance (since 97% of these people are insured)?

I wonder if the 95% of people who don't want a tax on health care services know that they are already paying a pretty hefty hidden tax on every MRI, CAT Scan, lab test, x-ray, and aspirin that they receive to offset the cost of treating a guy who doesn't have insurance.

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Friday, December 4, 2009

We're getting some publicity...

by Cylinsier

So we've attracted the attention of a libertarian blog with my previous post:

The Tenth Amendment Center

I can honestly say I love knowing we're getting peoples' attention. I commented on the above blog but unlike us, they do not have open comments so I am not sure if it will be posted. I hope so though! Anyway, if you want to see what kind of ire I've attracted, follow the link above. Maybe we can start a list of arch nemeses soon.

In all seriousness, they are polite folks so if any stray libertarians are looking for a good blog to frequent, this may be for you.

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Tuesday, December 1, 2009

Libertarianism as a fashion statement

by Cylinsier

There has been a movement recently among conservatives to identify as libertarian while at the same time blatantly illustrating a total lack of understanding of what libertarianism is. Basically, it occurs when a particularly staunch conservative is railing against some perceived socialist/communist/atheist/islamist/fascist threat and then, as if to remind us that his opinions are not grounded in partisanship (which they are), he adds, "and I'm not just saying this because I'm a Republican. I'm a libertarian." Another thing we can credit Glenn Beck for, by the way.

Here's the problem: what these conservatives are really advocating when they talk about states' rights and small central government is not really libertarianism, its more anti-federalism. Libertarianism is, at is most basic level, the belief that government should not legislate social or economic freedoms. Its more or less a kind of organized anarchy. There are plenty of reasons why that system wouldn't work, but there's no reason to go into that because its not a system that these fauxbertarians are really advocating; ask someone claiming libertarianism if they are in favor of global isolationism, or legalization of all drugs, or gay marriage. You'd be hard pressed to find one that says yes.

The big difference between real libertarianism and anti-federalism is that the latter doesn't support the elimination of government from citizens' lives, just the elimination of the federal government. Its really an ideology of convenience; most of these so-called libertarians were not in favor of states' rights trumping federal law when Bush was President. Rather, its a situation of not wanting the other guy's government to be in control, which signifies a lack of respect for the way our government works in my opinion, but that's another story.

Setting aside the transparent reasoning for supporting anti-federalism, what the fauxbertarians exhibit in their outspoken support of state supremacy is a total lack of knowledge of history. While no other country that I can immediately think of has tried a style of anti-federalist government in modern history (I suppose feudalism might count if you want to go further back), the United States actually did try confederacy as a style of government. It failed miserably. In 1781, our young nation ratified the Articles of Confederation. By 1788, the founding fathers had already convened to replace it. As a Federal Union, we have lasted 221 years. As a confederacy, we lasted 7.

The problem with that Articles was that giving such great power to the different states while giving so little power to a governing body over them allowed each state too much freedom to act in their own personal interests without regard to the common good. States were free to tell their armies what to do without having to confer with other states. They were free to refuse to pay federal taxes. They were free to print their own currency and refuse to accept the currency of other states. The "United States" was more like a collection of 13 individual nations than 13 parts of a whole. Anti-federalists either do not remember learning about this time in school, or they simply refuse to acknowledge it. But just like each individual citizen has a responsibility to maintain personal order for the sake of society, each individual state had a responsibility to maintain order for the Union. And also just like individuals, without some form of governing body enforcing basic laws, there was no incentive for these states to do so under the Articles.

Anti-federalism does have one thing in common with libertarianism; both systems function on the belief that people or individual states are inherently fair and self-regulating and will ultimately make the correct decisions without being forced, and that acting for personal gain and prosperity can be achieved without harming the overall welfare of society. As history has shown us repeatedly, this is not the case by any means. The vast majority of people are short-sighted and self-serving. Allowing a system like anti-federalism to become the rule of the land would lead to eventual collapse. We tried it for 7 years before the founding fathers realized that. We teach our children in schools to learn about government from the fathers' decisions, so why do so many refuse to learn this lesson? Anti-federalism doesn't work.

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Sunday, November 22, 2009

A response to '12 reasons Chrome OS will fail'

by Cylinsier

A couple days ago, I read a blog post called 12 reasons Chrome OS will fail, by Patricio Robles on This is a point by point response to those reasons and why I disagree with them. If you don't know, Chrome OS is Google's foray into the operating system market. It is geared primarily towards netbooks as a low hassle no frills OS for those that need quick access to the web and not much else.

I will quote each point before responding to it.

The web matters, but so does the desktop. With Chrome OS, Google is betting that desktop apps don't matter to the average consumer. Is that a good bet? Probably not. While there's no doubt that you can do a lot on the web today, but that doesn't mean the desktop is dead. From accounting programs (e.g. Quickbooks) to P2P software (e.g. Limewire) to the desktop software that comes bundled with devices like digital cameras, there are plenty of desktop applications that average consumers still use, or might want to use.

The reason I don't buy this argument is actually twofold. First, Robles' argument here depends on the notion that someone would buy a netbook as a notebook or desktop replacement, but considering how low the prices are getting and the obvious direction of that market, its pretty clear the netbooks are being handled as peripheral devices closer to PDAs and smartphones than actual computers right now. Second, part of Chrome OS is building a large number of applications into the web environment that were previously desktop oriented; Google documents for example. Microsoft is even catching onto this trend, something I might address in a future blog post. But for the most part, people who want a netbook aren't being duped into losing their desktop apps, they just aren't looking for them in this package.

Less isn't more. Even if 95% of what you do is on the web and Chrome OS seems like a viable choice, why buy a machine that can do less than the machine you have today? Unless the machines packing Chrome OS are significantly cheaper, the average consumers is not going to pay approximately the same amount of money for less functionality and flexibility.

I more or less answered this above; you buy this machine to work with your other gear, not in place of it. And the price is going to be pretty cheap. You can already get XP ready netbooks in the $400 dollar area; imagine how much you save with Chrome OS (which is free).

Google's focus on netbooks is short-sighted. Netbooks may not be dying, but the ultrathin is fast becoming the new netbook. Some low-end ultrathins sporting more powerful ultra-low voltage (ULV) CPUs from Intel and AMD cost as much as high-end netbooks with much less powerful processors. The question for a consumer is why you'd want to run an OS clearly designed for yesterday's netbooks on your new, more powerful ultrathin. The obvious answer: you don't.

This again overlooks the difference between notebooks and netbooks. The major draw of a netbook running Chrome is going to be the get-up-and-go speed of starting it up. Since Chrome will run off a SSD drive and is essentially a browser turned OS, you're literally talking about startup times in the seconds. What Robles is doing wrong here is comparing netbooks and notebooks as though they are competing products; they aren't.

Consumers are comfortable with Windows. Love it or hate it, Windows is in a long-term relationship with consumers. Getting them to cozy up to a different kind of OS is a huge marketing challenge. As is getting them to keep their Chrome OS machine once they realize that it's a Chrome OS machine. As an example, consider MSI, which has in the past attributed the high return rates for some of its netbooks to the fact that they were running Linux.

I don't know if I buy this. Netbooks running Windows were XP until recently. But didn't we just spend three years talking about how much we don't like Vista? How many people are already ripe to try something new? If that isn't enough proof for you, consider that Windows also had a significant head start in the mobile market with Windows CE. Where'd that get them? The most popular mobile OS is the iPhone, followed by Palm and, yes, Google Android is quickly gaining attention. Windows Mobile is lingering near the bottom. Apple seems to think this might be a talking point as well; seen all those "switch to Mac instead of Windows 7" adverts? They might be onto something.

Windows 7 rocks. Microsoft's new OS has received a lot of positive press, and as someone who is running it on a new ultrathin ULV laptop, I can say that it's a very decent OS and is much, much faster than Vista. In fact, if I owned an underpowered netbook I suspect I still might be able to get away with running Windows 7 on it. As a fun comparison, consider that (according to Net Applications) Windows 7 has already achieved greater marketshare in the OS market since mid-September than the Chrome browser has achieved in the browser market since December 2008. Yet Google has promoted the Chrome browser on some of the most trafficked properties in the world, including on its homepage. That shows the significant mountain Google faces in penetrating the OS market.

This is all fine and dandy as a talking point, but how are you going to install Windows 7 on that netbook without a DVD drive? Oh, you can't. You just have to settle with Windows 7 Starter pre-packaged on a new netbook, which will cost about $200 bucks more than Chrome by the way. Have you used 7 starter? Its nothing like the 7 you're running on your notebook. And I don't see any reason to draw correlation between browser performance and OS performance; they are very different animals.

Google doesn't have a monopoly on web apps. Chrome OS is a viable option if you can use web apps exclusively. But so is Windows, Mac OS X, Linux or any other operating system that runs a web browser. After all, you can run web apps -- including Google's -- in just about every modern browser. In other words, when you get right down to it Google isn't really offering you anything that you don't already have.

I disagree; Google is offering you a netbook that boots up faster than any other on the market, gives you quick and easy access to the internet, is light and portable, and costs several hundred dollars less than the Windows version.

Support? What support? If you're an average consumer and something goes wrong with your Chrome OS netbook, who are you going to call? Certainly not Google. And without massive usage, it's hard to see local computer techs (or services like the Geek Squad) jumping over themselves to support Chrome OS users.

This is nit-picky. When has anything Google has ever done not received substantial support from their staff AND the thousands of dedicated members of Google's community? Trust me, if something goes wrong, you will be able to Google it and get your answer in no time; who cares if its the traditional customer support phone call or an internet search? At least with the latter, you don't get some one in Asia you can't understand trying to help you with your problem.

HTML5 isn't here. Google's belief in web apps is inherently based on its belief in HTML5. There's only one problem: HTML5 isn't here and it will almost certainly be years before developers really start looking at it seriously.

So is that a death sentence? Internet Explorer 9 is already boasting major HTML5 support, and Mozilla has dropped hints about it too. Safari can't be far behind. HTML5 may still be a ways off, but Google isn't the only entity already hedging bets with it.

The interesting features are technical. Google is bringing some interesting things to the table with Chrome OS but most of them are subtle details that appeal to techies. The problem is that you can't really sell technical details to the layman with enough specificity to be meaningful.

This is really just a matter of opinion. I think a lot of the things Google does appeal to technophiles more than the common user, but they're still popular. There's a substantial market out there for Chrome even if it is only for the tech savvy.

Only 'referenced hardware' will be supported. Chrome OS may be open source but it will only run on hardware Google chooses to support. There are obvious, logical reasons for this but make no doubt about it: this is a huge barrier to adoption and in my opinion will even make it difficult for Chrome OS to compete with Linux. That's bad news for Chrome OS, since we know how well the Ubuntus of the world have fared.

This hasn't stopped Mac OSX.

The Chrome browser hasn't taken the world by storm. While one could debate how respectable Google's results with the Chrome browser are, one can't debate a simple fact: Chrome is clearly not taking over the world. Which begs the question: if consumers aren't flocking to download Chrome the browser for free, why will they flock to pay for machines with Chrome OS when the key selling points are largely the same? Answer: they won't.

Already addressed above, but I'll repeat; I see no reason to draw a correlation between browser performance and OS performance. And this argument is posited as if consumers looking for netbooks have competitive options; price-wise, they won't. The reason someone will buy a Chrome OS netbook is because they're going to spend the money on the netbook anyway and they will spend less on this one. If anything, Chrome browser is a boon for Google, giving users something akin to a free trial of the OS. And say what you will about Chrome browser, but its easy to use.

At the end of the day, Chrome OS is the Chrome browser. When you take a few steps back, all Google has really done is built an 'OS' to run a web browser. Not a big deal.

Still separating the hardware from the software when that is not the point. Chrome OS sells on the fact that there is a market for netbooks and they are already buying; the question is simply which one they are buying. Chrome offers faster startup and simple internet access. Most people who use netbooks don't want to replace their power machine. Google recognizes this and sees that you're not going to want to be doing a lot of desktop work on such a small platform anyway, but if you are swinging by Panera and need to send a quick email or Google map your drive to a friend's house, you can be on that wifi in seconds. That's a huge advantage over other netbooks who still boot to OS with all the extraneous desktop steps despite the SSD. That's why Google has a chance to hit a home run with Chrome OS.

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Wednesday, November 18, 2009

The Fox News Delusion

by Cylinsier

A short while ago, reports started circulating that more people watch Fox News than any other cable news channel, and ever since the far right conservatives of the country have been creaming their jeans over it. Nevermind the fact that celebrating this basically meaningless statistic lends a lot of credence to the claims that Fox News is the mouthpiece of the GOP, something that these same orgasmic fans deny. The fact of the matter is that its a bunch of horseshit, a clever twisting of viewership numbers to sell a premise, that Fox News broadcasts the best shows, that is simply not true. And there are a large number of reasons why, so many that its hard to decide where to start.

But of course, I did decide. However, before I get to that, I'm going to be comparing data sets from two different studies from the same source. The first is Network News viewership and the second is Cable News viewership.

So, let's start with Cable News compared to Network News. This one is pretty easy. We'll compare prime time viewership of cable news with nighttime viewership of network news; its not a totally fair comparison because they are two different products, but its a good indicator of where people are going to get their news. Viewership is in amount per night.

Using CBS news to represent the networks (because it is the lowest in ratings of the three), network news brings in a hair over 6 million viewers. Compare that to 4.5 million viewers FOR ALL OF CABLE NEWS, and you will see that more people grab their news from CBS before bed at night than do CNN, HN, MSNBC and Fox combined. And if you really want to blow it away, combine all three networks. Together they comprise close to 23 million viewers. You could compare nighttime network viewership to daytime cable viewership if you wanted, but the disparity is even greater. Despite the fact that cable news is on all day, that one block of network news at night still pulls in more viewers. If nothing else, this at least frames the cable news debate as what it is: not really important.

But this isn't about where people get their news anyway. Its about which cable channel entertains the most and pulls in the most viewers. So which is it? Fox News, right? Well, not really. See, the research that got conservatives foaming at the mouths about how great Fox News is was a listing of top rated cable news shows. Huffington Post (sorry, but they had the data spelled out the best, so live with the cite, conservatives), points out that 9 out of 10 of the top rated cable shows are on Fox News. Hey, we're not even talking cable news at this point, but all of cable! Pretty good...they also score 2 and a quarter million viewers in this poll to CNN's 1.1 million (the next closest cable news network). My cable news source above corroborates those numbers in this graph:

Cut and dry? Not quite. It really depends on the method you want to use to measure viewers. The above graph uses the nightly method of measuring how many viewers are watching a program at any one time, the method that almost everyone uses to measure ratings. But there is another method of measurement, cumulative viewers per year. That method measures the total number of unique visitors in a year, not unlike measuring unique hits to a web site. Well, how do you think the news channels stack up in that regard?

CNN has over 10 million more viewers a year? And by the end of 2008, MSNBC was tied with Fox? Oh, the humanity!

Of course, Fox quickly discounts this method of measurement because it is considered inaccurate by advertisers. Fair enough, I can see how an advertiser wants to put their money down on a time slot with the most viewers at any one time, not try to take a shot in the dark from a cume measurement. But outside of advertising, it is a pretty telling measurement of how the channels are doing on the whole. This can mean only that Fox gets great viewership for those 9 shows in the top 10, and then everyone stops watching. Or, it might mean something else, something that isn't broached upon in these studies. It might mean people watch more than one cable news channel.

It is important to point out that the above graph (at least I think) is combining CNN proper and Headline News into one number. If you split them apart, would they both rank below the others? I don't know because I don't know how much of the total each channel represents, but probably. That would leave Fox News and MSNBC in a dead heat for first in cume. But this illustrates another point that is overlooked by Fox News fanatics, and that is that Fox News and other cable news are apples and oranges. If you want to watch crazy people, you have one channel to choose from: Fox News. There is no competition. If you want to watch non-crazy news, you have a lot more choices.

The best way to illustrate the point of this is with an analogy. I stole these numbers off various internet sites but since they are just being used for the analogy, assume they are correct without me posting ten sources. Let's say Fox is booze, CNN is Coke and MSNBC is Pepsi. Every year, Americans consume around 30 million gallons of alcohol. They consume around 25 million gallons of Coke and a little less than that of Pepsi. So alcohol is the most popular beverage. Yes, if you break the competition down into sub-categories. But if you combine all colas, Americans consume 50 million gallons a year, a pretty good margin of difference.

Fox News is booze. CNN, MSNBC and Headline News are cola, just different brands. Yes, Americans drink more booze over all than they do any one brand of cola, but when you consider that Americans only drink less Coke because they also have Pepsi, Dr. Pepper and Root Beer to choose from, it makes sense that Coke would have a decreased performance; they have competition. Booze, when there's only one source of it, is booze. If you want booze, you drink from that one source. If you want crazy people, you watch Fox News because you have no choice.

Just one more thing. A recent study indicates that the average age of Fox News viewers is 65. This is the highest of the cable news channels. The current life expectancy in the US is 78 (and bound to go down now that we've stopped checking for breast cancer and can't get reform through Congress). There are only two scenarios that explain this high age, and neither is good for Fox. The first is that no young people watch them, meaning if their oldest viewers are around 80, then their youngest viewers are around 50. That brings out an easy 65 average. The other option is that young people do watch Fox News. But if they do, there are very few. Because few people get past 80, the number of people over 65 would have to be much higher than the number of much younger viewers to pull the average back up. Either way, Fox News is looking at a significant drop in viewership in about 15 to 20 years, or when the baby boomers start to drop. Glory is fleeting.

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Please read about Kate and Peter Ambrusco

By Ellipses

I understand that this content isn't typical of The Elliptical Press. Bear with me.

This morning, a state representative from Pennsylvania tweeted a link to a blog that is written by Amy Ambrusco that details her life after her two children were killed in a car accident. It goes without saying that the blog itself is heart-wrenching and is best digested piecemeal rather than all at once. That said, the frankness with which Ms. Ambrusco recounts her daily struggles coping with her loss is touching and reaffirming on a number of levels. I immediately saw myself in some of her comments... rather, I saw myself eventually reacting to certain stimuli in a similar manner as she.

Because of that instantaneous connection and the feeling the it evoked in me, I submitted a link to her blog to Reddit, a social news website where submissions are voted up or down based on their relative quality within the community. The reaction to it has been positive and the comments to the submission confirm that Ms. Ambrusco is speaking to the world in a language that is familiar to many people. It came to my attention that Ms. Ambrusco and her ex-husband are raising money to construct a playground in their children's memory near their former school. Since we have a number of regular readers as well as a greater number of spontaneous first-time readers that stumble onto our blog, I wanted to basically create another spot on the internet where this story is made accessible to people.

Click here to read the Callapitter Blog

Click here to read about the fundraising efforts to build a memorial playground.
There is an address to which donations may be sent at the bottom of that article.

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Gold, Glenn Beck, and making the right financial decisions

by Cylinsier

I was going to write this blog last night so it would be more timely and the topic would be fresh in my mind, but I was unexpectedly delayed in returning home. Yeah...Lincoln Town Cars suck.

Anyway, before experiencing that physical and emotional trauma, I bravely subjected myself to far worse mental trauma in the name of objectivity. I watched the last half of Glenn Beck's show on Fox News while eating dinner. I did not vomit, although I did lose a bit of my appetite.

Now I don't have cable at home, so I don't watch any of the cable news channels regularly. When I travel and find myself in a hotel, I tend to watch Headline News because it gets right to the point, but then it starts repeating itself so I turn it off and don't watch anything. I have no patience for regular CNN because its chock full of boring shows.

The last time I was in a hotel, I watched MSNBC because I never had before. I enjoyed it a lot actually, in the same way I occasionally enjoy Saturday Night Live or Youtube videos. But it wasn't really "news."

So it came time to cross briefly to the dark side and witness what is apparently the most watched cable news channel. I had watched Fox News on occasion back at the beginning of this decade, but not for years, and not since Glenn Beck joined them. I saw my chance to rectify that and took it.

So I sat down, sipped my soda and watched. Becky Glenn was in the middle of some diatribe involving his chalk board and something akin to math. I paid attention and tried to follow his logic, but he was yelling at me and it was a little distracting. The math didn't really back up the argument he was trying to make, but he kept insisting that the math was not real, but made up, like how the Dow was back around 10,000 but that wasn't real. I guess when you're crazy, shit that's really happening isn't real because the voices in your head tell you so.

Okay, a commercial. This is interesting. They're trying to convince me that my finances aren't sound and I need accounting help. Hm, now they are trying to sell me gold. And now they are trying to get me to go to the casino in Wheeling. I'm noticing a theme here: Fox News wants me to spend money and things that aren't products.

Glenn Beck is back and he is making it abundantly clear that he hates government. He admits that he is insane, which is a refreshing blast of honesty, but then continues. I'll include a clip of this last segment of the show for your own...enjoyment.

Becky is apparently a little perturbed that the vast majority of Americans are having government forced down their throats in the form of health care, assuring us that just because you can't hear them, or see them, or physically locate them on this plane of existence, it does not mean that this vast majority does not exist(in his mind)!

Bombshell alert! The Glenn Beck show, come January, is going to change. Becks will be moving...FORWARD. It must be a big move if its going to take him until January. It seems this Saturday in Florida (presumably chosen as the location due to the inordinately high number of morons; see hanging chads, circa 2000) Becko will unveil his master plan to all, which involves taking defibrillator paddles to the heart of personal responsibility in this country and shocking it back to life. As he vehemently states, people in the federal government refuse to take responsibility for their actions. Cough cough, Dick Cheny, cough, George Bush. We're off health care and back onto spending again by the way. And my favorite Glenn Beck quote, "Failure is Good," which epitomizes his entire career.

We're back on commercials, and they're trying to sell me gold and financial advice again. Apparently, my money situation is so bad that I need to give more of it away.

Coming back, we're greeted by the Glenn Beck chalk board with the word Truth scrawled on it in big letters. I wonder, does Glenn Beck just assume his viewers have the education level of third graders and that's why he has to write his crap on a chalk board, or does he need the board to keep reminding himself of what he's talking about? Maybe both.

We've gotten on to unions now. And illegal immigrants. I feel a little numb in my mind trying to draw logical conclusions from Beck's wild jumping around on topics and HOLY FUCK ANOTHER COMMERCIAL. I bet they're going to try to sell me gold again, maybe with a celebrity this time?

Peter Graves is trying to sell me gold. Not quite the level of celebrity I'm hoping for, but then again the only celebrity you're going to convince to peddle gold to people is going to be the out of work variety. And more financial advice. And more casinos.

Beck is back and he's decided to dress it up. The pink shirt tucked into jeans was apparently not classy enough, so we've added the navy blue sport jacket. It doesn't make him look less idiotic. Beck's guest, some guy who works for a group I've never heard of, is saying Obama is taking over private business. All of it. Through the unions. His private union army. The evidence is that Andy Stern has been to the white house 22 times (Beck comments that we are spinning ourselves into oblivion; good, that explains my headache). The next accusation is that the government wants to drag the standard of living of America down. They want to do this because? OH SHIT, we'll never know, because its time for ANOTHER FUCKING COMMERCIAL.

Buy some gold and some financial advice and play the slots. I have a feeling that if I bought REAL financial advice, they'd tell me NOT to play the slots, NOT to invest in gold, and NOT to watch Fox News anymore. I can also see why Glenn Beck's master plan is going to have to wait until January to be set in motion; its going to take him that long to spell it out between commercial breaks.

Beck is back and reminds us to catch up with him Florida where we will "look each other in the whites of the eyes." ...the fuck does that mean? Anyway, thanks, Glenn, for the experience. Its one I won't soon forget...or understand. Then the show cuts off and I guess maybe we're going to commercial again. I don't know, I was done eating and walked out at this point. I had a date with a Lincoln Town Car.

I think what I took away from this experience is that Glenn Beck, and by extension Fox News, isn't any different from MSNBC or CNN. All three channels claim to be news but show very little actual news, instead choosing to jam pack their schedules with talking heads who make bold and wild analytical observations about subjects they do not understand and have no educational background in. Each channel caters to a different audience.

MSNBC looks to grab people that are smart enough to realize that its all crap and are just their for the laughs...which is why they are failing. Those people are also smart enough to spend their time on better things than watching shitty cable news. CNN looks to grab the attention or people looking to fall asleep to something, and they are very effective. Fox News draws in the dumb, gullible, psychotic, and masochistic. That's really the best audience to go after because they are easily manipulated into believing everything you say, and if they believe everything you say they will believe they need to keep watching. Except for the masochistic, who do it because they enjoy pain.

Me, I don't have the stomach for that. Now that my foray into cable news is complete, I've decided to leave more detailed research to those with a stronger will and more time to spare. I'll stick to other sources for now. But it was fun.

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Tuesday, November 17, 2009

Charlie Bit My Finger... AUTOTUNED!

By Ellipses

Autotune makes everything better:

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Monday, November 16, 2009

Riding the Google Wave

by Cylinsier

Just a quick plug; as some of the tech savvy among you may know, Google Wave is in its beta stage and a handful of us have been fortunate enough to get an invite from Google or another friendly waver and join in the fun. Well, e and I are two of those lucky wavers and we now have a presence on the Wavosphere. If you are also among the first wave of...wave...then please fell free to find us and chat. Just search for us once you're logged in:

with:public elliptical press

Looking forward to playing in the waves with you.

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Sunday, November 15, 2009

Iconoclast: Part Trois

By Ellipses

In this, the third installment of my Iconoclast series investigating the self-evident truths of the anti-reform movement, I am tackling the issue of insurance industry profits.

A substantial part of the health care debate has been on the issue of insurance industry profits juxtaposed with high premiums and denials of claims. Reform proponents point to the explosive growth of insurance companies' gross profit, that is, the number of actual dollars reaped over and above costs, as a sign that the scale is tipped in favor of the corporation over the individual. Opponents to reform will inevitably point to the fact that the market segment "Health Care Plans" is the 86th most profitable market segment with a mean profit margin of 3.3%. They may highlight the fact that railroads have a net profit margin of over 12%, telecoms often operate in the 20% range, and the lowly Tupperware corporation is rolling in 7.75% profit margins. Clearly, the evil insurance companies are not living high on the hog, right?

Wrong. Or, I could take the Penn & Teller route and say "Bullshit." Or, I could take the Mythbusters route and say "Busted."

First, let's take care of a really basic issue: Why do companies generate profit? That seems simple enough, right? They earn a profit because... well, their end product or service is more valuable than the component parts? They worked hard and kept costs down? They want to reward their shareholders for fronting the capital to produce their shit? They want to build the value of the company?

Wrong. Well, not so much "wrong" as "off-target."

From year to year, a company can project sales and costs, but cannot absolutely predict them. Along with the unpredictability of the business environment, there is the added unpredictability of the competition. You don't know how your competitors are going to try to fuck you from one day to the next. You need to build value within your company so that you have capital available to weather a downturn, diversify your product offerings, cut your margins to undercut your competitors, buy emerging competitors out, or otherwise leverage cash to facilitate maintaining or growing your position in the market. That's "WHY" you generate profit. Adding value to raw materials, specializing in a service in order to deliver it efficiently, cutting costs... those are all ways that help you generate more profit, but the reason that you want to end the year with more money than what you paid out is that the excess cash frees you up to do things to stay in business.

If you are a railroad, you have shit to maintain. You have thousands of miles of rails, huge-ass energy bills, giant vehicles that weigh millions of pounds, employees that load shit, drive shit, and unload shit. If you want to have a railroad business, you have to buy lots and lots of stuff. It takes a lot of capital to do ANYTHING in the railroad industry. Therefore, you can rock 12% margins even after being in business for 150 years.

Similarly, the telecom industry has a relatively high infrastructure cost, but it is also highly competitive. Not only do you have to maintain a bazillion miles of fiber, but you have to be able to subsidize handsets, buy millions of dollars in TV advertising and take a loss on 2/3 of a triple play bundle just to stay competitive with the cable company and Google, who gives shit away for free. Once you have all that stuff in place, though, it doesn't actually cost you anything to transmit a text message, but you can get teen girls everywhere to sell half their vag just for the ability to send an unlimited amount of them. So, you get 20% margins and relatively low levels of pushback.

For Tupperware, you are being assaulted from all sides. You have ziplock making the exact same thing as you. Hell, grocery stores make the shit you sell and sell it under their own name. You have NO idea what the market is going to bear next year. If the economy rebounds and people stop cooking their own food, you have to be able to compensate for that lack of business. Not to mention the fact that your product lasts for goddamn ever and there are women out there putting their broccoli cheese casserole in the same fart-locked bowl that they got for their wedding back in 1977. It's amazing to me that tupperware is still in business. 7.5% is a goddamn crime if you ask me.

So that brings us to health insurance. It is an actuarial business, not unlike slot machines, by which the house always wins given x customers paying y dollars and maintaining a z rate of claims submissions. For every health care segment, from cardiac care to cancer to pneumonia to flu to food poisoning to broken bones, there is a data table showing a range of probability of any given ailment befalling a person no matter what their age, income, occupation, ethnic background, and other health/lifestyle indicators. All you have to do is maintain a subscriber base and charge more than the cost of the risk threshhold. There is no variability in your costs. You pay agents a fixed commission structure for their sales of your product. Once a sale has been made, there is very little churn within your industry. It's not like you have to re-sell insurance to every customer every month or every year. Hell, most of the time, you are selling a package deal to a business and they are distributing it to their employees for you. How much does it cost to write a policy? From one year to the next, what investment do you need to make in your product to retain your customers? The entire industry is built upon predictability. Which brings me to my point:

If your business is predictable, you can opt for higher compensation INSTEAD OF high profit margins because you can reliably generate revenue from year to year. You don't need excess cash to fix a thousand miles of rail. You don't need a big nut to subsidize a hot new handset in order to attract new subscribers. You don't need to pour money into developing new lighter, stronger, more microwave friendly polymers to remain competitive. All you have to be able to do is forecast how many heart attacks you are going to have to pay for, how many breast cancer cases you can expect, how many births, deaths, broken legs, and torn scrotums you will have to pay out for... and then fulfill claims within those forecasts.

For the purpose of this article, I will be using Aetna as an example. Their financials are available, free to the public, through any financial news outlet that allows you to research individual companies.

This past year, Aetna's profit margin was 3.87%, which sounds wholly reasonable. But what is that in terms of actual dollars? Well, their gross profit was 8.2 billion dollars. Their earnings before interest, taxation, depreciation, and amortization (EBITDA) was 2.69 billion dollars. Their net income was 1.31 billion dollars.

The first question that begs to be asked is: Did Aetna deny any claims during that year? Sure, in fact, they denied over 40,000 claims between 2007 and 2008. Would those claims have amounted to more than the 1.31 billion dollars that Aetna kept as profit? Perhaps. But with 40,000 claims denied, you absolutely cannot deny that Aetna's profit came at the expense of individuals' financial well-being and overall physical health. Someone was denied payment on a medical claim so that Aetna would generate 1.31 billion dollars in profit. That is undeniable.

But still, 3.87% is such a small profit margin. Aetna had revenues of 33.77 billion dollars. Certainly, they would have expensed out a huge amount of cash to cover approved claims, but aside from claims approval, they have to pay their 35,000 employees and incentivize their sales staff to grow their member base. Aetna CEO Ron Williams recieved 24 million dollars in total compensation last year. The first 3 million was in base pay, and the rest came in the form of stock options, 401(k) matches, and fringe benefits such as use of corporate jet, financial planning services, and vehicle allotment. Again, not to begrudge someone's earning potential, but how many claims were denied in order for Williams to make that last 4 million dollars in salary? If his total compensation were 20 million instead of 24 million, would someone be alive today who put off treatment due to their claim being denied? Would a family have not filed for bankruptcy due to medical expenses if Mr. Williams "only" made 15 million dollars?

Certainly, there are those of you among us who would point to the fact that medicare's claims denial rate is .05 HIGHER than Aetna's. That sounds like a reasonable argument to make. How much profit did medicare generate last year that could have been used to pay for a denied claim rather than to enrich shareholders or pay the administrator's salary? Zero? Less than zero? Imagine that... an insurance program that ONLY caters to the oldest and most infirm among us not being able to generate billions of dollars in profit. Whoda thunk?

So, my conclusion? Insurance is an industry in which the house always wins. The only variable is "by how much?" Because the industry is able to reliably and consistently generate formulaic revenue, formulaic expenses, and formulaic growth, the actual margin of profit is negligible. Rather than produce margins in excess of 10, 20, or 30%, the revenue exceeding the base costs of doing business are plowed back into the employees who comprise the revenue engine. And even then, the dollar value of that single digit profit margin is enough to pay for thousands of operations whose claims are routinely denied, at least initially, in order to reward everyone except the person whose life and property are at risk. The logical side of me says that if a single claim is denied, the insurer should report $0 profit and 0% profit margin. If you have satisfied every claim, if you have exercised zero instances of rescission, if you have not increased your premiums, then you can reap the rewards of your due diligence. Until then, every dollar of profit, regardless of the margin, comes at the expense of the health and well-being of the customers you are supposedly serving.

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