You saw these issues earlier than I did and they are well-expressed in your letter. As you say, we can only hope somebody in the White House is reading what you wrote and takes it seriously.

that is full of BS.

^{"All men's gains are the fruit of venturing."}

-Herodotus

In the absence of adequate regulatory control of abuse-prone businesses, the only other thing that sorta-kinda reins in the worst corporate and governmental offenders is recourse to the courts. In the absence of access to the courts, the next stop is Third World style oligarchy.

That we have ordinary citizens arguing against their own last line of defense against predation by the rich and powerful is yet another testament to the conservative brainwash machine's ability to turn people into activists against their own interests. It's especially baffling to me that lately I have heard insane-sounding murmurings about "death panels" and the like from people who have no health insurance now.

Is it something they're putting in the Diet Pepsi?

An analysis of Wellpoint can show 35% saving. I'll post a link later.

Please take you opinions in front of a spreadsheet.

A second set of saving is to replace fee-for-service with capitation payments.

A third set of savings is to sell dugrs at world prices.

A fourth set of savings is to use nurses instead of doctors whereever possible.

A fifth set is to change food subsidies from sweet fats to healthy veg, and to penalize restaurant who do not neet "food pyramid" standards in their sales. Yes McDonalds that mean you.

The major impediment to savings is the intransigence of the big business, both medical big business and the rest of the pack. Big business kills its; customers in the search for profits and growth, from denying medical proceedures to poisening us.

The most important part of haelth care is clean water, clean air, elimination of toxins in the environment, free childhood innoculation (without mercury), healthly food and exercise.

If a health insurance company does not reduce the proportion of money that goes to pay claims year after year, the shareholders punish the stock. Ergo, there is a direct conflict and a zero sum game between company profits and paying claims. By definition, these companies are your enemy since if they win you lose, and vice versa.

Ya mean they profit by denying my claims? Yup, and ain't it a wonderful system?

But your point is valid about tort as it extends to malpractice and liability. "socialized" medicine needs more than a centralized payer to work. It also needs centralized authority. As long as we allow the courts to decide whether a doctor has performed his duty adequately, and thereafter how much "profit" that doctor's insurance must surrender to a "damaged" party, the concept, nay the spirit of true public medicine will never take hold.

The practice of medicine, in the end, is at best an inexact science which takes many years to learn, even when the student is extremely devoted. Mistakes are made even by the best doctors. Thus, as long as society insists that it be fail-proof, and allows someone other than doctors to control the practice, the success of any "public" plan will be negligible, if any success is to be found at all.

The alternative from the Asian point of View. Let's take China. Thery have 900,000,000 people who don't have much and want more.

Pull the plug on the US, and what do you get? 900,000,000 happy people, or 900,000,000 pissed off people? People who might want their leaders heads. One thing I'm sure about, is their leaders are very fond of their heads being attached to their bodies.

so the price for the chinese leaders head-neck continuum is to keep on subsidising the air-conditioned nightmare?

it's like watching two dogs getting stuck while copulating!

I suspect the alternatives to keep pouring money into us are looking better.

The fact is that we have sold them our entire industrial base. In many cases, packed up the machinery and shipped it there. Now they have to figure out their own financial policy because they probably don't want ours.

The Chinese are making the same mistake US manufacturers made in the 1920s when they extended credit to their buyers in Europe. When Creditanstalt in Austria failed, suddenly the world realized that the buyers didn't have the means to pay back their debts. The US was stuck, and the depression here was worse than the depression in Europe.

So far the Chinese have made up for a drastic drop in their exports by pumping government money into the economy at a fantastic clip. All it has done is ignite another ridiculous stock market bubble and reinflated their very serious real estate bubble. The government has backed off the stimulus effort in the past two months because of these consequences.

So what do they do next? They have all our machinery to continue acting as manufacturer to the world. They have all the cheap labor they need. They can't continue domestic stimulus at high levels without creating bubbles and depleting their reserves, which are already under pressure because so much of the reserve pool is kept in shaky US government securities.

What they need is buyers, and since 80% of Chinese workers make about $200 a year, they don't have a domestic consumer market to replace the Americans who were willing to buy cheap junk from Wal-Mart as long as the Chinese were providing financing. So there is the conundrum. The American consumer is no longer interested in buying on credit because the virtuous cycle that drove up housing prices and the stock market has now gone in reverse. The US government is looking every day like a less worthy borrower as well, and so the Chinese are trying to diversify some of their $2 trillion in reserves away from the US dollar.

It looks a lot like 1929, only this time the Chinese are on the receiving end of a very bad depression. Let's see how long they can forestall it by creating stock market and real estate bubbles of their own at home.

What passes for US manufacturers now days need access to credit in order to pay the factory owner in China for the finished goods. Let's suppose you are company oh call it NYKEE a sporting goods "manufacturer" and you need to manufacture 100,000 soccer balls; of course it would be silly to have your own factory; so you have it done in China. The Chinese company seeks and gets credit from a bank to cover the manufacturing of the balls until shipment to NYKEE. Meanwhile NYKEE needs credit during the period between having to pay the Chinese company and the payment terms of NYKEE's customers; i.e., your friendly neighborhood High Five sporting goods store who have a 30 day or more term of payment. The High Five stores use a line of credit that they've established with a bank to pay off their delivery of soccer balls after 30 days; then high five turns around and sells the soccer balls with the proceeds to pay down their line of credit. Everyone pays off their creditor right down to the Chinese manufacturer.

All this works fine until high five is unable to turn its inventory at a price that allows it to pay off its line of credit under the covenants agreed to with the bank. Then High Five's bank, who may itself be in trouble, begins to tighten up the terms on the line of credit. High Five is in a bind because they need to use their limited credit to buy more inventory or they will be almost immediately out of business. So maybe High Five stiffs NYKEE for a while. Now NYKEE is in trouble with its line of credit needed to pay the Chinese; and so the trouble rolls down the line until High Five either pays off its vendor, NYKEE goes bankrupt or High Five gives up the ghost when their bank
pulls their line of credit.

This is happening all up and down the line as we speak.

This was probably at the trough of the distorted credit cycle you describe. At that time, global trade plummeted, empty container ships were piling up in major ports with nothing to do, the Baltic Dry index collapsed, and central banks had to intervene to get any trade finance going.

Apparently things have picked up a bit but like everything else, we have recovered only a fraction of the economic flows of 2007. It looks like it is going to take a long long time to get trade activity back to where it was only two years ago.

You can tell which stores are struggling by noticing their level of inventory. Does a department store seem a little roomier? More space in the Isles? They are dieing a slow death from a wound inflicted at, as you say, the trough.

They just don't have any idea how to crank it up again. They also seem to know it is unhealthy, but have no idea what should replace it. If the US is going to reenter manufacturing, what can it make cheaply enough with the right quality in order to have a dominant market share? The only option at the moment seems to be spend 10 to 20 years making the average US worker poor enough so that labor costs will make the US competitive on the global markets.

I suspect when the history of this depression is written, a lot of work will concentrate not so much on the US, but on China. The lesson taken will be about the dangers to a global economy having one country play such a dominant role in manufacturing and export. This seems to be the one consistent feature between this depression and the 1930s depression (including the explosion of debt, financed by the manufacturer/exporter to the world).

"making the average US worker poor enough so that labor costs will make the US competitive on the global markets"

US labor cost < China labor cost + shipping + tarrifs

and I suspect it will take less than 10 to 20 years to drive US labor into penury.

Was there was a dominant manufacturer in the 1930s? USA, UK, and Germany were all large. Germany was broken becuase of reparations from WW I.

but he paid his workers twice what he had to, because he understood the people making the product had to be able to afford to buy it.
The irony here is those squeezing labor, here and in China, are destroying their collective market. Not only the market for manufactured goods, but the investment markets based on manufacturing. The economy has to have a convection cycle of rising assets and precipitating benefits, or it breaks down. Healthy labor is healthy consumers. How hard is that to figure?
Growth is bottom up. When the system gets too top heavy, it collapses. Supply side economics was hit the wall and that's all there is to it. The bankers and the plutocrats have all the money, but nothing to do with it. They have become a shell which needs to be shed.