Saturday, December 24, 2011

Ho, ho ho; get your Air Jordans while they last

I don’t wear a watch more than twice a year, and when I do, it’s usually one of those $20 buy-it-at-the-airport deals that I’m likely to lose before the battery runs down.
So I can’t be absolutely sure, but I think the most useless, ridiculous, and wasteful gift I have seen this holiday season is this: an automatic watch winder that will, for $99.99, wind your self-winding watch.
I’m not kidding.  According to the blurb in the Brookstone catalog, “if your watch doesn’t wind itself from wrist motion, it cannot be wound by our winders.” 
And as long as you’re buying the winder, you might as well purchase a cordless battery pack for $24.99. If you want to wind two watches at the same time, you can buy the double watch winder for $149.99 or, for four watches, a quadruple watch winder for $199.99 (otherwise known as $200).
You can also buy individual modular winders that hook together – up to 12 at a time – for $59.99 each.  You are a wealthy person indeed if you need 12 $60 gizmos to wind your self-winding watches. 
 I’ll bet both the self-winding watches and the watch winders on offer here (and my airport watch) are made in China by factory workers whose working conditions are so miserable they are contemplating suicide when not chained to their work benches for 30 hours at a time (see Donald L. Barlett and James B. Steele’s recent expose of Apple in the Philadelphia Inquirer ).  
Since I’m not a big watch person, you tell me, is there some value to having a machine to wind your self-winding watch or is this thing just stupid?  
Not that there are not other gifts this year that don’t come close to rivaling the automatic watch winder. 
There is, for example, the pillow universal remote ($39.99), also offered by Brookstone.  I can’t help but wonder, can you put your head on this pillow without constantly changing the channel?
And there’s the spiral staircase architectural model ($149) offered in the Signals catalog, “exquisitely handcrafted in cherry wood, with hand-carved details and a French distressed finish.”  At the end of the day, it’s still a 15-inch high wooden model of a spiral staircase.
Signals also offers a stainless steel cuff bracelet for $45 with, your choice of a map of the New York, London or Milan subway system.  If you’re a regular user of any of these subway systems, you already know your way around, and if you’re not, $45, really?  I’ve gotten around the Moscow subway with a wall map that spells the names of the stops in Cyrillic without needing one of these bracelets.
Of course every gift catalog offers some spectacularly useless and expensive items, which, I think, illustrates a very basic point about our capitalist economy: it is demand, not tax policy that drives economic growth.
When the Republican/Tea Party crowd starts whining about how job creators are not creating jobs/loaning money/building American factories, etc., because of the “climate of uncertainty,” the claim is that businesses are uncertain about whether or not they are going to have to pay higher taxes or endure more “crushing” government regulation.
If corporations actually paid the 35 percent tax rate they are allegedly assessed, they might have some reason to gripe and, admittedly, there is some excessive government regulation of small businesses designed to prevent them from cheating on their taxes, but that’s not what uncertainty is all about.
The main uncertainty for any business is whether there is going to be a demand for its products or services, whether enough people will buy their cars, lunches, MRIs or watch winders, to keep them in business and help them make a profit.  If there is strong demand, businesses will hire more workers to fill that demand without giving a second thought to the tax rate or a pile of government forms.
If there is little or no demand for their goods and services at prices people are willing to pay, businesses will go out of business.  They will not build factories, hire more workers or stockpile inventory.  Supply and demand, still a useful economic model after all these years.
And when a lot of people are out of work, facing foreclosure, about to be cut off from unemployment insurance and have no job prospects, guess what, watch winders and subway map bracelets don’t have a lot of appeal.  Food and a mortgage payment are likely higher priorities. 
Or they should be priorities.  I was appalled by a laborer I saw in a TV news segment the other night who was pawning his tools to buy his mother a Christmas present.  And she was probably pawning her TV to buy him a cordless drill.  O'Henry is spinning in his grave!
On the other hand, stampedes for $180 Air Jordans?  Maybe that’s a sign of better economic times rather than merely mass lunacy.
Every year this artificial construct known as the Christmas season comes along to pump up demand and rescue the economy at the last minute. 
Everybody rushes out to buy gifts, gets stuck in traffic, can’t find a parking place at the mall, can’t find that one present that absolutely everyone must have, and generally gets very stressed out.
And so, we all buy into the convenient fiction that we are honoring the birth of a man who, as far as we know, never owned, or wanted to own, anything more than the clothes on his back and the sandals on his feet.   
Brick and mortar merchants and online merchants have a lot of confidence that this holiday shopping season is going to be better than most previous years. 
Often that’s just wishful thinking, but I hope that’s true this year, not for the sake of CEO bonuses but for the actual people who work for those businesses and the overall economy.   
One family is guaranteed to have a very merry Christmas.  Thanks to their patriarch’s mastery of the concept of supply and demand, the nine members of the Walton family, purely by accident of birth, own Walmart and are worth $93 billion dollars, more than the GNP of many countries.
For me and many  people I know who have had to tighten  their belts one more notch this year, the Christmas season is more “bah, humbug, I’m not spending a dime” than “merry, merry, let’s take the family to Aruba.”   
But nevertheless, merry Christmas, happy Hanukah and joyous whatever you celebrate.

Friday, December 9, 2011

Obamacare is already here; so shut up already!

An average of $569 – that how much some 2.6 million Medicare recipients will save on the donut hole this year thanks to the Affordable Care Act, or as we have all come to know it, Obamacare. 
Over time, the donut hole will gradually close and the cost of prescription drugs will diminish by many billions of dollars.  (If you don’t know what the donut hole is, Google it; it would take too much space to explain here.  It’s enough to know that you can thank George W. Bush’s giveaway to Big Pharm for it as the “tradeoff” for the never paid-for Medicare prescription drug coverage.  You seniors were okay with that, weren't you?)
A Sound Off caller, complaining about government inefficiency today, ended his comment with “Imagine if you will, what’s going to happen when Obamacare kicks in.”
Most people don’t seem to grasp that Obamacare has already “kicked in” and is about two-thirds implemented.  Check out this time line that tells you month by month when various aspects of the law have/will “kick in".  The check marks across the top indicate what has already happened.
It’s true that the insurance mandate won’t start until 2014, but many other parts of this big, complex, law are already operating, or businesses and health care providers  are implementing aspects of it on their own.   You’ve actually been seeing it, in your doctors’ offices and hospitals and in state government, you just don’t realize it. 
The law will lead to standardized, computerized medical records and forms, something a lot of my doctors have already done.  It’s kind of cool when my doctor just sends a prescription by email and the medication is already waiting for me by the time I get to my pharmacy.   And my gynecologist goes from exam room to exam room pushing a computer stand with a computer that already contains all my records.   These modernizations will be huge money savers down the road if they are not already.
In addition, the pre-existing insurance plan tab on the time line shows you what each state has done to provide pre-existing condition insurance.  Here in Pennsylvania, it’s called the PA Fair Care plan. It costs $283 a month, requires a $1,000 deductible and provides coverage for those who are citizens, have been uninsured for six months and have been denied coverage for a pre-existing condition.   Go to this site for details and a web site and telephone number.
This plan really exists. It may not be a Cadillac plan, but it helps.  I know someone who has it and recently had to be hospitalized.  He’ll probably have some uncovered medical bills and that $1,000 deductible to pay, but at least he will not have to file for personal bankruptcy, as he may well have had to do before getting the coverage.
Some of you may have seen the front-page article in the Philadelphia Inquirer Nov. 23, saying that Gov. Tom Corbett is beginning to create what the paper described as “a key and widely supported” state-run health insurance exchange to allow people to shop for the lowest cost health insurance.  Back to the time line:  that part of the law is scheduled to “kick in” Jan. 1, 2014.
As for government inefficiency, the new law does, or will do, a great deal to improve efficiencies.  For example, the Obama Administration has already greatly increased the investigation and prosecution of health care fraud.  The government estimates that fraud costs taxpayers $60 billion a year.  Sixty billion a year! Some estimate that may be the low end. 
The Bush Administration allowed this problem to fester by failing to hire investigators to fill existing vacancies, adopting a laisse faire attitude toward fraud and failing to change a loophole in the law that required Medicare and Medicaid to pay providers and then determine if they were legitimate.
The Obama Administration, even without the Affordable Care Act, instituted special Medicare strike forces in Baton Rouge, Tampa, Brooklyn, Miami, Los Angeles, Houston and Detroit to go after fraud.  Just today (Dec. 9) a judge in Miami sentenced a former executive of the American Therapeutic Corp. to 35 years in prison for health care fraud and the same judge has already sentenced two other ATC execs to 50 and 35 years respectively. Wowser, the Feds are not messing around.
Other provisions of the law restrain health insurers from precipitously raising rates and overcharging for premiums, as well as strengthening the Medicare Advantage program to prevent insurers from gouging subscribers and denying benefits.
Another efficiency included in the Affordable Care Act is the Independent Payment Advisory Board that was scheduled to begin operations in October to develop and submit proposals to Congress and the President aimed at extending the life of the Medicare Trust Fund.  The board is not, however, the “death panel” that the Tea Party conjured up. 
The new law will provide incentives for physicians to join together to form “Accountable Care Organizations” or “medical homes” where groups of doctors will coordinate patient care to help prevent disease and illness, and reduce unnecessary hospital admissions.  I’m already doing that on my own, consolidating my health care among doctors at one hospital who can work together to treat the whole me instead of this part or that part.
Contrary to predictions, rather than kill jobs, Obamacare has created 295,000 new health care jobs. 
And, according to Forbes magazine, a significant number of small businesses are offering their employees health insurance, thanks to the provision in the law that gives them a credit worth up to 35 percent of their contribution to their employees’ health insurance.  That provision “kicked in” Jan. 1, 2010.
We will see what the U.S. Supreme Court rules on the last provision  of Obamacare, the health insurance mandate, and I don’t even want to try to handicap that decision, but much, perhaps 70-80 percent of Obamcare won’t and can’t be undone no matter the Court's decision and for that we should all be grateful.