Sarah Palin vs Friedrich Nietzsche
Tags: America, Culture, Health Care, Politics
… or the war against freedom of thought
Friedrich Nietzsche
Whoever knows he is deep, strives for clarity; whoever would like to appear deep to the crowd, strives for obscurity. For the crowd considers anything deep if only it cannot see the bottom: the crowd is so timid and afraid of going into the water.
- Friedrich Nietzsche
I don’t care where you stand on the recent health care debate in America. Both sides have valid points, albeit driven by completely different ideologies.
The problem with the debates on either side was that the argument wasn’t driven by rational principles, as you are well aware.
Using the heart to battle the mind
America had some tough questions to answer: why was it no longer sports the most competitive free market in the world (Switzerland now holds that crown after its health care restructuring in 1994) and why was the cost vs benefit ratio is the lowest in the developed word. It is the last nation in the developed world not to offer comprehensive health care (instead it imposes yearly and lifetime caps, making it inadequate as disaster insurance) and meddles more in the doctor patient relationships than most Northern European nations (insurance companies restrict free access to doctors and limit the prescriptions and treatments available). That is not to say that all was bad with American health care, but that the world had changed, and a change in the system was required.
This was America’ s call for a rational debate, comparing its strengths and weaknesses to that of other countries and finding a uniquely American answer that could reform the bad while keeping the good.
Instead, stake holders rushed to Washington to write big checks in order to guarantee their annual returns despite their shortcomings in performance.
And that crippled an honest debate. Since we could no longer indulge in objective analysis, something else had to be done.
Battle lines were drawn between both political parties trying to protect their stakeholders, instead of an open debate about why the system couldn’t deliver uncapped health care at 2/3rds of the cost as is the case in many nations, or why American health insurers don’t have to compete as ferociously as in some European countries. Emotional words such as ‘socialized health care’ were trumped up, ignoring the fact that America subsidizes its health care to a higher degree than some European countries. ‘Death panels’ were invented, despite the fact that there were no death panels in any other countries. ‘Rationing health care’ was presented as a doom and gloom scenario, despite the fact that yearly and lifetime caps make America’s health care system the most rationed health care system in the world. ‘Skyrocketing costs’ were predicted, despite the fact that America’s health care is the most expensive in the developed world, burdened by the highest administration cost. Tort reform was ignored as was the reason why tort reform is complicated: there are only 2.4 doctors per 1000 citizens compared to 4 doctors per 1000 citizens in Europe, leading to grueling work hours for doctors and the highest medical malpractice in the developed world. ‘Interference in the doctor patient relationship’ was boosted despite the fact that America is one of the only countries in the developed world where you couldn’t freely choose the doctor you go with and one of the only countries where insurers could meddle in your prescriptions and treatments. ‘Innovation is under threat’ said political actors despite the fact that America is only the most innovative system in terms of cancer treatments and relied on European donations of the swine flu vaccine because its markets failed to create the volume requested. Political actors also pointed to the fact that America is the most responsive system in the world, but failed to mention why that was: because many of its citizens either have no access to health care or lose that access when their yearly cap runs out (resulting in bankruptcy and loss of access to the health care system). America is the most responsive system in the world (only marginally so, but still), but only because so many people can’t actually afford health care. ‘Free markets must be protected’ was the battle cry, despite the fact that America is far from the most competitive health care system in the world, protecting insurers from full on competition and allowing oligopolies to from by state mandate. One political party had to pass reform no matter what to survive, the other had to kill it no matter what to triumph.
None of these arguments were presented as rational arguments. They were there as slogans, to raise the emotional temperature, to instill fear.
Because when we feel frightened, when we feel we are about to lose something, we lose the ability to think. Emotional arguments mainly served to obscure the real challenges we face.
And that is where politicians failed the American people. They failed to present us with pragmatic options, instead tried to defend the stakeholders by injecting so much emotion in the debate that we lost the ability to conduct a rational review in answering the complicated but worthwhile question: how can we improve the cost vs benefit ratio for the American consumer?
In the end, the biggest winners were the stakeholders…
But knowing Sarah Palin, one of the actors who injected a lot of anger and emotion into the debate, she would have written off Nietzsche’s quote by pointing out the man went mad and that his philosophical works were adopted by the Nazi’s, essentially blocking any thought about the validity of his argument…
Tags: America, Culture, Health Care, Politics
What teachers make
Tags: Culture, Poem, School, Teachers, Video
Perhaps the most forwarded poem in YouTube’s history. This from a man who is actually a professional poet.
Birth of the UK National Debt…
Tags: 04081694, 05301693, 07101690, 1690, 1693, 1694, Admiral Tourville, Bank of England, Battle of Beachy Head, Battle of Lagos Bay, English Navy, George Rook, Glorious Revolution, History, Holland, John Evelyn, National Debt, Rye, Samuel Jeake, United Kingdom, Wapen Van Medemblik, William III, Zeeland
… or the world’s first stimulus bill
From the National Maritime Museum
12 July 1690. Samuel Jeake looked over the ocean. A frightening sight sent his heart racing. The outlines of an English ship was forming over the horizon. Samuel knew that just days before the English Navy, faced with impossible odds, had suffered a terrible defeat at the hands of the French Admiral Tourville in the Battle of Beachy Head. The English had lost 11 ships, the French none. The fleet’s only hope had been retreat.
Jeake stared tentatively at the English ship, and the speed with which it was approaching indicated it was on the run. This could mean only one thing: the French were coming to sack Rye. Others who had seen the same frightful sight, rang the church bells and alerted the occupants of Rye to pack their belongings and flee the town. Chaos ensued. The town only had one exit, and soon people trampled each other clamoring for their escape.
The English ship limped to the beach. The captain, not wanting his ship to fall in French hands, set the ship alight. Onto this day, if the sea is right, the skeleton of the burned ship surfaces on the beaches of Rye, as a ghost resurfacing to tell of a terrible time, when England was at the mercy of its worst foe.
[CONTINUES BELOW]
Battle of Beachy Head 10 July 1690
Other English ships had made it to the river Thames. The streets of London were filled with panic upon the sight of the battered fleet. It seemed clear that the Navy had been beaten, and nothing could stop a French invasion.
John Evelyn
The whole nation now exceedingly alarmed by the French fleet braving our coast even to the very Thames mouth;
wrote diarist John Evelyn. But the French did not fully pursue, a tactical error that would deprive the French of a major long term victory.
This meant that the English were able to mobilize 90 ships by the end of August and break the French control over the channel. But it also meant that the weakened English fleet could no longer adequately protect its merchant ships on their trade missions while defending its shores.
In the years to come, this would cost the English dearly. English sailors filled their ships with the nations hard earned trade, said goodbye to their families and unprotected by the navy, set sail for exotic destinations, hoping to make their fortune. But they never returned… They were probably captured or destroyed by the French or commercial raiders.
Fear paralyzed the hearts of the seamen the merchants and by 1692 trade missions ground to a halt, sucking the life blood out of the English economy.
The recession deepens
Goods destined for trade now accumulated in the English harbors without ever being sent out, in fear of capture and destruction.
The English people were never one’s to be beaten by the odds, as history proved again and again. Churchill’s words during WWII would have rung as true in 1693 as they did when he gave his speech:
Churchill
[...] we shall defend our Island, whatever the cost may be, we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and in the streets, we shall fight in the hills; we shall never surrender, and if, which I do not for a moment believe, this Island or a large part of it were subjugated and starving, then our Empire beyond the seas, armed and guarded by the British Fleet, would carry on the struggle [...] .
But of course, there was no mighty British fleet. Instead, despair and hunger turned into an active move of defiance: 0n the 30th of May 1693, the merchants organized themselves to break the impasse in a bold and risky move. 200 merchant ships would band together and undertake a trade mission to Smyrna, Turkey. On board was a years worth of trade that had just been sitting in the harbors: wool, tin, spices and silver, the richest trade mission the world had ever seen. But it also presented a most alluring price to the enemies of the Kingdom.
King William III
King William the 3rd fully understood this was a make or break moment and matched the bold move of the merchants and the sailors with one of his own. He would send almost his entire war fleet comprised of Dutch and English ships to escort the mission, leaving England unprotected. His 102 war ships escorted the trade mission until the port of Brest, where the French historically positioned their fleet. Then it would double back to English shores to provide protection against a potential French invasion.
French spies had uncovered the particulars of the mission, and having decided against an invasion of England in favor of a war against English commerce, they positioned 93 of their war ships further up at Lagos Bay, at the Southern tip of Portugal.
On June the 27th of 1693 the unsuspecting merchant flotilla, under command of George Rook, sailed into the French trap. Waiting for them, was the French fleet, commanded by their old enemy Admiral Tourville, which once had a chance to destroy the might of the English navy but passed up on it. Tourville smiled. He had been shamed for his blunder 3 years ago, and here was a chance to remake his name.
George Rooke
Hardened by the previous years of misery, George Rook kept a cool head. He ordered the fleet to disperse, making it harder for the organized French army to capture the ships. He was going to take his losses, but not without giving his men a chance to get as many ships through as possible.
He ordered two Dutch ships under his command to bide the fleet time by engaging the French war ships directly. The crew of the Zeeland and the Wapen van Medemblik set course for the French and prayed to their God to be merciful on their souls.
It must have been an odd sight, these two lonely ships approaching the might of a 93 strong French war engine. Tourville cursed. He had hoped for the greatest of victories: that the merchant fleet would band together and could slowly be ground down by his war machine. Instead, the ships in front of him dispersed in all directions. He ordered pursuit.
Admiral Tourville
The Zeeland and the Wapen van Medemblik collided with his fleet, entering the heart of the warships. They fought valiantly taking overwhelming fire power from every side, but selling their skin dearly. The hulls of the ships were pierced with hundreds of cannon balls. In the inner depths of the ship, men were hacked to pieces by a combination of cannon balls and ricocheting pieces of wood. The floor was lined with sand to soak up all the blood, but became a muddy mess instead. Still, it provided enough disarray amongst the French fleet to slow it down. Tourville had no choice to order part of his fleet to concentrate on the two ships running havoc. The Dutch fought so brave, that he never managed to conquer them, but finally, exhausted and having taken huge losses, the two captains surrendered. Tourville had the captains (Philip Schrijver and Jan van der Poel) brought to his quarters. He congratulated them on their bravery and asked them if they “were men or devils”
Despite this display of death defying bravery and the good judgment of Rooke, the French still captured or destroyed almost 100 merchant vessels.
The news hit England and sent the merchant classes in despair. A wave of bankruptcies ensued. The economy, already on its knees, fell on its face.
A national effort to raise money
King William the 3rd needed a Navy to protect English trade missions and he needed it fast. In its current state, it could not protect the English shores and the trade missions at the same time. The challenge he faced was that the coffers were empty and the economy was so depressed that raising taxes might lead to revolt and further economic malaise. Something else had to be done to raise money.
King William the 3rd was the son of a Dutch father and an English mother. At birth he was destined to be the King of Holland. As the king of Holland, he had learned two things: the power of the Navy, which had been instrumental in the invasion of England which had overthrown his father in law, the English King James II during the Glorious Revolution. But it also gave him a unique insight in the financial revolution that the Dutch had brought the world: the world’s first stock market, created almost a century before in 1602, where citizens could invest their hard earned money into corporation in exchange for a return on their investment.
Perhaps this Dutch innovation could be a way to mobilize the battered riches of the country?
Working together with Scotsman William Patterson, the creation of The Bank of England was proposed in 1694. Anyone willing and able to put in 25 Pounds, would get a guaranteed 8% return on his investment. The return was so appealing that both the wealthy and the poor invested their savings in the bank. A look at the book of Investors in the Bank of England reveals the names of the King and Queen, who invested 10,000 pounds, but also the names of historical actors who’s names we recognize from this blog post: John Evelyn and Samuel Jeake, who upon hearing the news had gathered all his riches, and traveled on horse back for 15 straight hours from Rye to London. Saddle soar, tired and hungry he arrived in London and without resting went straight to his financial agent to discuss the investment. Browsing through the book, we see something even more fascinating: the name of 9 people who were in domestic service who invested every hard earned dime in the bank. This was truly a country wide effort, where everyone who had money poured it into the bank of England.
In just 12 days it raised 1.2 million pounds, and on August the 4th, it made its first loan to the government.
Bank of England Charter sealing 1694
Ship of the line
The national debt provided a virtuous circle of funding: the government borrowed money from the people, which built a navy, which allowed for trade, which increased the tax revenues that allowed the government to pay its people back with interest.
More than half of the first loan went to building up the navy and this in turn transformed the economy. Each navy ship required over 5 tons of iron nails, 2000 trees, 7000 square yards of canvas and 10 miles of ropes. The navy soon employed 44,000 men, and feeding them reshaped English agriculture. Building the ships made South England into the navy’s building yard, North East Britain into the world’s first industrial iron works (providing the nails) and soon the navy was the engine of English commerce, transforming the countries economy and laying new foundations of the modern world as we know it. In 10 years, the navy was 176 ships strong and soon became the sole rulers of the sea.
But that is a story for another day.
Tags: 04081694, 05301693, 07101690, 1690, 1693, 1694, Admiral Tourville, Bank of England, Battle of Beachy Head, Battle of Lagos Bay, English Navy, George Rook, Glorious Revolution, History, Holland, John Evelyn, National Debt, Rye, Samuel Jeake, United Kingdom, Wapen Van Medemblik, William III, Zeeland
A breakdown of health care profits
Tags: Health Care
There has been a lot of anger about health insurers’ profits in America. Like many Americans, yours truly, the trusting author of this blog, has heard President Obama talking about record profits amongst health insurers in his town hall meetings and became disillusioned by the greed that existed in the market.
But is there greed?
Only way to find out is to look at the income statements of the health insurers and try and calculate how much profit is made exactly.
For this discussion, I used the income statement of WellPoint, one of the biggest insurers in the US. You can examine that income statement here. Note, Before you think their revenues are pitiful, note that all data is reflected in millions.
Revenues
When we examine the income statement for 2008, we can see that the total revenue came to $61,579 million dollars.
Total Operating revenue Wellpoint
If we break that down, we see that $57,101 million or 93.2% came from premium revenues and$3,836 million (6.3%) came from fees for administering the claims of employers that self insure (meaning they set aside their own funds to cover their employees health care and WellPoint administers this scheme for them.) $641 million, about 1% comes from other revenue, not specified. This is probably interest earned on money that is received before payment was due, or moneys received in advance of claims actually being approved (when a user signs up, they generally have to pay the premium, when they get declined, the premium is refunded. During that time, interest is earned).
Expenses
47,742 million is paid out in benefit expenses
Benefit expenses simply means paying out health benefits such as doctor consultations, hospital stays, etc.
The other expense is paying for drugs the insured buy:
This amounts to $468 million dollars.
These two expense figures combined come to $57,101 million.
This expense only relates to the revenue made on premiums and totals 84.4% of that:
Revenue on premiums
Strictly speaking, that does not mean that 84.4 cents of every dollar you spend on health care returns to you in the form of health care benefits. But that is a whole other discussion.
You could argue that a portion of other revenue should be counted as well. Remember that other revenue is most likely derived from premiums paid early and premium payments held before the applicant is allowed to be insured by WellPoint. Some of that money would also be generated from payments make by employers who provide their own funds and pay WellPoint to administer their health care fund. But because we can’ t breakdown the ‘other revenue’ we are not including in here. I admit that makes the ratio of revenue on premiums vs expense paid out on health benefits imperfect. For this break down, we treat the data in the benefit of the health insurance companies.
Another expense is incurred in the marketing budget. Total marketing expenses were 1,778 million:
Marketing (selling) expense
Marketing expenses should be measured against total revenue, as all services are marketed:
Total Operating revenue Wellpoint
Marketing expense is a total of 2.6% of total revenue.
Then there is the expense of administering the company. That comes to 7,242 million.
Administrative expenses
That comes down to 10.7%. Many business owners will recognize this as a very high number, but administering millions of claims is quite a complex business.
Profits
So taking all of these expenses in account, how much profit does WellPoint make?
Well, we need to substract all the expenses above.:
Total expenses
Total expenses come down to 58,128.7 million or 86% of total revenue.
That is when the tax man comes knocking on your door.
Income tax
Are health care companies making obscene profits?
After we subtract expenses and income tax from total revenue, the total profit made is 4.04% of total revenue.
Net income
If we consider this number, the problem doesn’t appear to be excessive profits, but rather problems with efficiency in expenses. We noted that administration amounted to 10.7%, which is a far more worrying number than a profit margin of 4.04% which is neither high nor low compared to other industries. It is rather the administrative expense that should be studied to find higher efficiencies.
A bigger picture for good form
Before every accountant starts sending me angry comments, we need to include some other figures. We haven’t taking into account the total assets and to examine these we need to turn to the firms balance sheet.
Here we find the total assets:
Taking the total assets deployed by the firm profits total 5.14%. down from 6.42% the year before.
If we examine the percentage that the equity shareholders had in WellPoint profits were 11.62% down from 14.55% in 2007.
Again, these numbers aren’t particulary offensive.
Also read my historical perspective on health care.
Tags: Health Care
Looking into the past
Tags: Cool pictures
Looking into the past Thomas Circle, Washington DC
Tags: Cool pictures
Horsetail falls
Tags: America, El Dorado, Horsetail falls, Nature
Horsetail Falls is a small seasonal waterfall that only appears in late winter and early spring. It flows over the east side of El Capitan, so as a backdrop it has one of the most impressive walls of granite in the entire park. Then – only for part of February, and only when the sky is clear – the very last sunrays of the day selectively linger on the falls, lighting it up with a golden glow that makes the water look like lava.
Tags: America, El Dorado, Horsetail falls, Nature
Literature vs Traffic
Tags: Art, Luzinterruptus
Luzinterruptus have brought their light-based street art from Madrid to NYC; 800 books, each with a light attached, with the intention of replacing traffic with literature.
o my.
Location: Brooklyn Bridge/ Water St., NYC
Tags: Art, Luzinterruptus
Socrates as Enigma
Tags: Anecdotes, Aristophanes, Daedalus, Euthyphro, Plato, Psychology, Socrates, Symposium, The Clouds
Socrates as intangible ghost
Socrates
In Euthyphro (written by Plato), Socrates claims to descend from the lineage of Daedalus, the mythic sculpture who created statues that, when completed, would begin to move in all directions, evading the grasp of the people. When someone would try to approach these statues, they would run away and disappear as if they were ghosts.
This story makes Socrates’ affinity with Daedalus revealing about how he sees himself (as written by Plato,of course): a personality that cannot be captured in a simple idea or definition, illusive like a ghost but filled with tantalizing beauty.
Socrates saw ideas very much in the same light as Daedalus’ statues. He felt that ideas that were written down died. As he tells Phaedrus:
I cannot help feeling, Phaedrus, that writing is unfortunately like painting; for the creations of the painter have the appearance of life, and yet if you ask them a question, they preserve a solemn silence
Source: Phaedrus.
In the writings of Antisthenes, Plato, Euclides and Aristippus Socrates presents himself as a complex, contradictory character. The minute you think you understand him, you lost him. A true offspring of Daedalus.
Perhaps that is why that Alcibiades tells us is in Symposium that
none of you knows Socrates
A man few liked: Socrates as a ridiculous character
As the comedian Aristophanes’ summed up Socrates’ personality in The Clouds (a play written during Socrates’ life, when the philosopher was middle aged):
A bold rascal, a fine speaker, impudent, shameless, a braggart, and adept at stringing lies, and an old stager at quibbles, a complete table of laws, a thorough rattle, a fox to slip through any hole, supple as a leathern strap, slippery as an eel, an artful fellow, a blusterer, a villain a knave with one hundred faces, cunning, intolerable, a gluttonous dog.
Socrates was disliked by many and liked by few. Alcibiades portrayal of Socrates in Symposium is telling:
[Socrates] spends his whole life playing his little game of irony and laughing up his sleeve at the world.
Diogenes Laertius writes:
Frequently, owing to his vehemence in argument, men set upon him with their fists and tore his hair our; and for the most part he was despised and laughed at, yet bore all this ill-usage patiently.
Tags: Anecdotes, Aristophanes, Daedalus, Euthyphro, Plato, Psychology, Socrates, Symposium, The Clouds