Archive for August 28th, 2009

TGIF And Predictions

Friday, August 28th, 2009

These were the events that mattered this week:

*Ted Kennedy died. A great American and a great Senator. Gorilla thinks his kind of liberalism seems as dead as can be in the world of Movingforwardville.

*Lots more talking about Middle East Peace. Gorilla thinks the odds of a serious peace process are about as remote and as good as they’ve been in the past 60 years.

*No real seriousness about health care reform. The crazies still rule the roost and the President doesn’t want to take on vested interests. Gorilla says we’ll get very little more than window dressing passed this year.

*Afghanistan continues to spiral downwards. There’s plenty of recognition that our policy isn’t working, but very little realism about what we can do to make things work. Gorilla believes we’ll be surging to withdrawl within 18 months.

*Goingbackwardville keeps getting in the President’s way. CIA torture, ever larger banks gaining ever freer passes to moral hazard, and rewarding the failures of Ben Bernanke et. al. with another term: Gorilla wonders when if ever we’ll decide that stupidity isn’t the first and only policy option.

*The dollar carry trade is the next bubble in international finance. We’ve become the new Japan, with the same old insolvent banks. Gorilla guesses this means we are the old Japan, with the same old insolvent banks.

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We Should Be So Lucky

Friday, August 28th, 2009

A postwar record high for Japanese unemployment: 5.9%!!!

Gorilla thinks: “Is it the sushi? The protectionism? The savings rate? The wasabi? We need to sell them more of our houses and get this country moving again!”

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Pulling The Plug On Ted Kennedy

Friday, August 28th, 2009

As the New York Times points out, the late Senator Ted Kennedy’s medical treatments in the last year of his life cost anywhere from $100-500,000.

The brain cancer for which he was treated has no known cure, and in the past 40 years life expectancy has gone from 4-6 months to 15-18 months.

Of course Senator Kennedy had insurance and sufficient private resources to pursue any kind of treatment anywhere in the world.

But the issue illustrated here is the vast amount of resources (estimated at 70% of all medical spending) that are spent on the last year of life, with no great change in the outcome. These costs are born by everyone in the form of higher insurance premiums, and in the case of the poor no insurance at all (both the rich and poor help to make our costs the highest by far in the world).

It’s exactly this sort of discussion that is missing from the health care debate. That’s what rationing is all about. We have to decide what treatments are worth covering and at what cost, because we as a society cannot afford unlimited care for every disease.

Currently, the insurance companies and the size of one’s wallet do the rationing, in future it is hoped that a more competitive system will bring the administrative costs of private insurance down and provide a basic standard of care for all. Those with the resources will of course be able to pursue more expensive treatments.

I think Ted Kennedy was prepared to make these hard choices in order to achieve the cause of his lifetime. But many of us don’t seem ready to have a serious debate leading to pragmatic decisions on providing coverage and accepting the inevitability of death. Until we do, health care reform is little more than a slogan.

Gorilla says: “We won’t be able to plug in lower costs until we unplug our fear and electrify our rationality!”

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