Special Interests

Wresting Control from the Special Interests: Electing Warren in 2012

Joseph M. Firestone — Sun, 03 Apr 2011 17:00:10 -0400

Scott Brown won the Massachusetts Senate seat vacated by Ted Kennedy in 2009 with the support of the special-interest backed Tea Party movement, and large campaign contributions from the banking and financial sector. He was also helped by disaffected working class voters. Whether Brown or another candidate supported by these players runs in 2012, mainstream Massachusetts voters will face an uphill battle trying to elect a senator who will champion their interests against special interests.

The legislative track records of major party lawmakers, especially Congressional representatives, show they are closely aligned with the interests of the corporate financial interests that finance their campaigns. While Democratic and Republican Congressional electoral candidates try to make it appear that there are major differences between them, their votes on key legislative issues tend to be quite similar in reflecting the priorities of their corporate campaign contributors. So regardless of which major party’s candidates voters elect, as hamstrung voters jockey back and forth between the two parties, voters get roughly the same special interest-favoring legislation.

Not only are the major party candidates unlikely to provide voters real alternatives in 2012, but the rumored third party presidential candidate who might emerge from the special interest-backed No Labels party, and the Americans Elect online nominating convention, is likely to run on an agenda crafted by the same conservative financial interests that are bankrolling both of these organizations, as well as the Democratic and Republican parties. Although No Labels and Americans Elect claim they are focused on the so-called “center” of American politics, comprised of the nearly 40% of voters who have defected from the ranks of registered Democrats and Republicans, both appear to be pursuing a conservative fiscal agenda articulated by financial fat cats like Peter Peterson.

While these political facts of life may make it seem impossible to imagine a scenario in which Massachusetts voters could elect a senator who would champion their interests, there is one scenario that might work. If Harvard law professor and consumer advocate Elizabeth Warren decides to enter the race, as she is being encouraged to do, she just might be able to take up the cause of mainstream Massachusetts voters and defeat these special interests to win herself the Massachusetts Senate seat if she and her supporters take advantage of two untapped political levers. The first lever is the large scale collective action power of the Internet, which has been showing increasing political muscle, and the second is the online voter mobilization potential of a unique social networking platform, the Interactive Voter Choice System (IVCS), now in development.

In two earlier posts in this series, I've analyzed the potential impact of IVCS on the 2012 elections in the 8th Congressional District of Virginia, and also in the coming Virginia Senate election contest that appears to be shaping up between former Senator George Allen and former Governor Tim Kaine. In this post, I'll show how Warren’s supporters can leverage both the collective action potential of the Internet and IVCS’s unique voter-mobilization tools and services to win both primary and general elections on the Democratic line in the 2012 Massachusetts Senate race. First, a brief primer on IVCS.

How It Works

IVCS enables voters to get out of a reactive mode and into the driver’s seat of U.S. elections. It is a voter-driven, political crowdsourcing platform that enables individual voters and political activists to bring virtually unlimited numbers of voters with common policy priorities into winning voting blocs and electoral coalitions that voters control. These blocs and coalitions can work within existing or new political parties to run and elect candidates to office who pledge to enact their priorities into law.

The IVCS social networking platform provides voters across the political spectrum free agenda-setting, organizing and consensus-building tools on a single website. The agenda-setting tools enable activists and voters to build personal networks with other voters who share their policy priorities. The platform’s organizing-building tools enable them to transform their networks into voting blocs and electoral coalitions hosted on the website. Its consensus-building tools enable them to build winning electoral bases of broad cross-sections of voters that run and elect candidates whom they can hold accountable for enacting their priorities into law. These electoral victories will enable U.S. voters to eliminate the ever widening gap between voters' priorities and the legislation enacted by lawmakers who follow the dictates of their special interest campaign contributors.

Most importantly, voting blocs that use IVCS tools to build voter-controlled electoral coalitions and democratize political parties, by giving their members real decision-making power to set their agendas and select their candidates, can neutralize the influence of special interest money in elections. For they can use web-based IVCS communication tools to get their message out and get their voters to the polls without special interest money. Moreover, by involving voters across the political spectrum in analyzing, weighing and debating policy priorities, they will also be able to counter the cognitive distortions in voters’ perceptions that special interests create by spreading false information and political propaganda.

Significantly, IVCS-enabled voting blocs, coalitions and political parties can prevent the fragmentation of the U.S. electorate into losing splinter groups and parties too small to win elections, and neutralize the impact of three special interest-backed parties, assuming the rumored third major party materializes and runs candidates in the 2012 presidential election. They can use IVCS consensus-building tools to wean away mainstream voters from these special interest-backed parties by giving them decision-making influence over policy agenda setting across the board and candidate selection that none of these parties is inclined to do.

These consensus-building tools enable voting blocs to create broad-based coalitions among large cross-sections of voters around transpartisan policy agendas. They can involve virtually unlimited numbers of voters in making decisions and resolving disagreements by using the IVCS Voting Utility to vote on their agendas, which candidates to run, contested issues and proposed political alliances and coalitions.

Since problem solving in the system will be web-based and distributed, rather than centralized, blocs and bloc-run coalitions will be able to quickly increase their voting strength by using the social networking capabilities of the Internet, coupled with IVCS organizing and consensus-building tools to reach out to other voters online. Moreover, they will adapt to their political environments more quickly and effectively than formally-organized political parties organized around rigid platforms. They will spontaneously merge into a nationwide yet decentralized Internet-based web of voter-controlled political organizations. Their members will be able to interact with each other at the speed of light through the networking capabilities of the IVCS website and rapidly supersede legacy parties and special interests as the driving forces in the American political system. (For more information about IVCS, click here.)

How Warren Supporters Can Use IVCS to Elect Warren in the 2012 Massachusetts Senate Race

Harvard law professor Elizabeth Warren is a nationally-known and highly-respected consumer advocate who served as chair of the Congressional Oversight Panel appointed to monitor the implementation of the Troubled Assets Relief Program (TARP), which bailed out insolvent banking and financial institutions during the 2008 – 2009 financial crisis. Although Warren was widely heralded as the most able person to take the reins of the new Consumer Financial Protection Bureau (CFPB) created by Congress after the crisis to protect consumers from predatory banks and financial institutions, Congressional opposition from Republican lawmakers has prevented her from being appointed to head up the new agency, which she originally proposed.

President Obama yielded to the opposition and appointed her only to oversee the development of the bureau as his Assistant. Since the bureau will be housed in the Treasury Department, she was also named Special Advisor to Treasury Secretary Geithner, despite the fact that they are reportedly at odds on numerous fronts. Even after assuming these positions, Warren has continued to be relentlessly attacked in the corporate media, vilified by right-wing lawmakers, and castigated by banking and financial interests – at the same time that she has become an heroic figure to supporters of financial reform. In light of increasing indications that effective financial reform is on-hold in the 112th Congress, and Warren’s appointment as head of the bureau is unlikely, support is gathering behind a Warren candidacy for the 2012 Massachusetts Senate race.

If she runs, the economic and political facts of life in that state in 2012 are unlikely to have changed very much since the 2009 election of Republican Scott Brown. If anything, they have worsened. Unemployment and underemployment will still be very high; the banksters and fraudsters will remain unpunished; taxes for the wealthy will remain low and may get lower; austerity will evidently still be the order of the day; at this writing, there's a good chance that Social Security expenditures will be cut before the Spring is out; a new wave of unemployment will be coming from state and local level austerity policies, and from a new round of foreclosures unless the state courts put a stop to them; health care costs and insurance prices will continue to rise; nothing will have been done about the unpopular “health care reform bill”; credit card interest rates will continue to be oppressive; the wars abroad are likely to continue; the “shared pain” of the trumped up fiscal crisis will not be shared by the well-off; and mainstream Americans will be somewhat, but not very much, concerned about public deficits and debts. During yet another election cycle, the economic and financial distress of working Americans will be given short shrift by politicians resorting to culture war issues to avoid talking about the real problems voters are facing. The views of a majority of voters regarding job creation, the distribution of the tax burden, and single payer health care will be ignored, or merely paid lip-service, by candidates whose real agendas reflect the wishes of their corporate campaign financiers.

So, voters will still be really angry at the Democrats for their poor performance in the last Congress, and absolutely livid at the Republicans for their performance in the present one, and their failure to do anything about any of the above -- especially their failure to keep their promises about jobs. In this environment people will be angry at Scott Brown, and they'll be none too happy with Massachusetts's ten House Democrats. All in all, 2012 won't be a good year for incumbents, for candidates of either of the two legacy parties, or for voters, who will be faced with choosing among a traditional Democratic or Republican candidate, or a rumored third party candidate running on a No Labels platform largely inspired by special interest fat cats like Peter Peterson.

The unique contribution of IVCS to this race (and any race, for that matter) is that it enables voters to join forces to set their own policy agendas, support announced candidates or put their own candidates on the ballot who will honor their agendas, and build electoral bases large enough to elect them to office.

We know from polls that a majority of Americans are fed up with both major parties and would like to replace most elected representatives in Congress. Any voter or political activist in Massachusetts can get the ball rolling to create a voting bloc to draft Warren by using the IVCS Policy Options Database on the IVCS website to set their individual policy agendas, and create their own personal home page on the IVCS website (which they can make public or keep private). This voter can query the IVCS Policy Priorities Database to see how many other Massachusetts voters have already selected priorities similar to theirs, contact them and invite them to the bloc.

These voters can form the nucleus of an ever expanding voting bloc hosted on the IVCS website, with its own home page, internal email and messaging tools. The organizers and members set their own rules for running the voting bloc. They can incrementally increase the size of their bloc by reaching out through their own personal online social networks to friends, family, neighbors, co-workers and members of like-minded groups of all stripes. They can invite them to join their bloc by accessing the website to set their agendas, compare them with those of the bloc as a whole, and decide to join the bloc if their priorities converge.

They should have no trouble ramping up the size of their bloc to attain decisive electoral strength, given polls showing that 60% - 80% of Americans are so dissatisfied with the Democratic and Republican parties that they want to see most incumbents in Congress defeated. They will be able to grow their bloc by leaps and bounds if they make systematic efforts to recruit new members by getting the word out that all of its members will be able to play an active role in setting the bloc’s agenda and formulating its electoral strategy. They can hold face-to-face and online “town meetings” to discuss the track record of Scott Brown, and collectively decide whether to get behind Warren and urge her to make a primary bid on the Democratic line. Assuming the bloc decides to do so, it can contact her directly to open negotiations to set a common agenda and address key strategic and logistical questions. Of course, the bloc will have to demonstrate its ability to gain the electoral strength it will need to get her elected in a primary and a general election

Needless to say, the Democratic primary for the Massachusetts Senate seat held by Scott Brown, as well as the general election, are likely to feature highly competitive races driven by the same divisive ideological and emotional issues that major candidates always use to gin up a winning electoral base on the part of supporters dispirited by their unsatisfactory legislative track records. IVCS can play a decisive role for a candidate like Warren entering the electoral fray by helping her forge a winning transpartisan electoral base that unites rather than divides the electorate.

A voting bloc that is large enough to win a primary election and possibly swing a close general election, but has an agenda that is likely to prove controversial to general election voters, could actually cost Warren votes if she committed to it. But a voting bloc that works with her to involve a broad cross-section of voters in setting a popular agenda can gain many votes for her, if she commits to the process and the agenda that emerges from it. Not only will the bloc’s members support her in getting out the vote needed to win the primary; but they can subsequently reach out across party lines, especially the lines of the unpopular Democratic and Republican parties, to involve large numbers of disaffected voters, especially those who have defected from the parties to register as Independents, in using IVCS agenda-setting, organizing and consensus-building tools. Such a unique, grassroots, pro-active involvement of voters can grow the voting bloc into a broad-based electoral coalition well beyond the ideological confines of the narrowing electoral bases of the Democratic and Republican parties.

One thing to keep in mind is that IVCS is likely to generate not just one voting bloc in the Massachusetts 2012 Senate race, but several. These blocs and coalitions can decide to run their own candidates or negotiate with candidates who have announced electoral bids. In exchange for the bloc’s support in mobilizing voters on their behalf, blocs can ask candidates to commit to bloc agendas that have already been set or to collaborate with them in creating a joint agenda. If, after these negotiations, candidates win with bloc support, the blocs will be able to hold them accountable in future elections for implementing mutually agreed upon agendas after they take office.

So, let’s assume that by late fall of 2011, IVCS is accelerating the formation of voting blocs and the mobilization of voters throughout the state. The whole roster of candidates for elective office in Massachusetts will find themselves in an unprecedentedly fluid, voter-driven political environment comprised of alternately diverging and converging IVCS-based voting blocs and electoral coalitions committed to enacting specific policy agendas set by their members. They will be rapidly growing in size. Once they have negotiated common agendas, endorsed candidates, and created coalitions and political alliances, they will be capable of mobilizing many hundreds of thousands of voters in Massachusetts and tipping the forthcoming elections in favor of the candidates they decided to support. Voters, not special interests, will be in the driver’s seat of the election.

The ability of IVCS-enabled voting blocs and coalitions to gain traction within the constellation of candidates in the Massachusetts 2012 primary election will depend on the present and anticipated size of specific blocs, the perceived degree of competitiveness of the races being run, the degree to which candidates and blocs can agree on common agendas, the blocs’ and candidates’ capacity to build electoral coalitions that mobilize other voters, as well as the degree to which candidates may be so beholden to special interests that they refuse to commit to enacting bloc formulated agendas.

So, assuming a pro-Warren voting bloc is formed with an agenda likely to be popular among Massachusetts voters, how large would its electoral base have to be in Massachusetts in order for her and the bloc to view the bloc as an effective organizational engine to get her on the ballot for the primary election, such that she would be induced to commit to its agenda?

Answer: if the bloc were the only organization working to put Warren on the ballot of the Democratic Party, bloc members would have to collect approximately 15,000 signatures from registered Democrats in order to be fairly certain of obtaining the minimum 10,000 valid signatures required by state law. Clearly, getting her on the primary ballot would not present an insurmountable hurdle for the voting bloc to overcome, assuming it has implemented a systematic voter recruitment and mobilization strategy that taps into the collective action power of the Internet and the social networking capabilities of IVCS.

For the next hurdle, the number of votes needed to win the primary election itself is quite a bit higher. In 2008, in a primary that wasn't hotly contested, Democratic Senate candidate John Kerry won the election with 335,923 votes out of 487,396 total votes cast. By comparison, in the 2009 special election, Democratic Senate candidate Martha Coakley received 310,227 votes out of 664,195 total votes cast in the Democratic primary.

The ultimately victorious Republican candidate, Scott Brown, won the Republican primary with only 145,465 votes out of 162,706 votes cast. (Once he got on the general election ballot, the donations and voter mobilization assistance he received from Tea Party funders and supporters, combined with the financial contributions he received from banks and financial institutions, enabled him to garner 1,168,178 votes, against 1,060,861 votes cast for his Democratic opponent Coakley in a state that has long been a traditional Democratic strong-hold.)

In view of the 2009 primary results in the Brown-Coakley race, in order for the voting bloc to persuade Warren to get behind the bloc’s agenda, or create a joint agenda, it would have to provide convincing evidence that it could mobilize upwards of 350,000 votes in a 2012 primary, or an average of 35,000 per Congressional District. (If more candidates enter the race, the number of votes the voting bloc needs drops, but it will still have to surpass the total garnered by any other candidate.) This 350,000 figure looks realistic considering that there'll probably be at least 3 or 4 candidates in the Democratic race. Announced, potential, and declined candidates include Martha Coakley, the 2010 Democratic candidate, who appears disinclined to run, with likely contenders including Mike Capuano, Joseph Patrick Kennedy III, Stephen Lynch, and Ed Markey. Three of them are in Congress now and are all very well-known. But the question remains whether an IVCS-enabled voting bloc could deliver 350,000 Democratic primary votes, and whether a candidate like Warren would be sufficiently convinced that it can deliver to commit to a voting bloc's policy agenda and run on it.

This is where a new, emerging political constituency, comprised of young Millennial voters, combined with the collective action power of the Internet, and the political crowdsourcing capabilities of IVCS, can create decisive levers for an insurgent candidate like Warren running an uphill race against major party regulars. Research on the 2008 presidential election demonstrates the margin of victory that Millennials can provide in a tightly divided race, and the effectiveness of web-based social networks in mobilizing them to become actively involved in these races.

Post-election surveys show that upwards of 125,000,000 Americans conducted their political activities during the 2008 presidential election over the Internet -- almost as many people as voted in the election itself. Barack Obama’s victory in that election is credited to his campaign’s ability to use the crowdsourcing capacity of web-based social networks like Facebook and MySpace to recruit young Millennial voters born between 1980 and the early 2000s. He used his campaign’s Facebook and MySpace pages to increase his “fan” base, and then migrate his fans to his campaign website, where his political organizers had built a huge database of voter files with many different kinds of information on each voter.

They used these files and the data they contained to transmit a steady stream of personally-tailored messages to each supporter. These messages were aimed at enticing them not only to volunteer to hold events in their local communities, distribute flyers, and solicit cam paign contributions, but at constantly encouraging them to use their own personal social networks to recruit their friends, family, neighbors and co-workers to Obama’s campaign website. When it came time to get out the vote, the original database had swelled to nearly 13,000,000 voters with whom the campaign could communicate instantly via email and text messages to drive his voters to the polls. The outcome was that Millennials provided Obama 80% of his popular vote margin over McCain.

With IVCS, it is voters rather than candidates who will use the political crowdsourcing potential of web-based social networks to run winning campaigns they control on behalf of agendas they set and candidates they select. Better social networking tools than Obama’s campaign used to create his margin of victory will be available to Millennial members of IVCS-enabled voting blocs hosted on the IVCS website. It is quite likely that they will not work as actively for Obama in 2012 as they did in 2008, because his policies have given them, along with most of the American middle class, the proverbial royal screw, when it comes to jobs and prospects for their futures. In 2012, they'll be looking for new, non-establishment, non-special interest-backed candidates to support. Elizabeth Warren may well be one of them.

Given the ubiquity of Millennials, the largest generation of voters in history, who will comprise 25% of the electorate in 2012 and 40% of the electorate in 2020, and their well-established sophistication using the web to build individual personal social networks comprised of hundreds of friends, family and co-workers, a voting bloc supporting Warren should have little difficulty building a winning electoral base. Once unemployed and uninsured, Millennials will join forces with disaffected mainstream voters to formulate policy agendas for bettering the condition of the middle class and providing full employment. They will use their social networking finesse to build a powerful web-based political constituency that can easily decide both the primary and general elections in Warren’s favor.

She is likely to commit to its policy agenda and to join forces with voting bloc members to win the Massachusetts primary and general elections because together, they can create a transpartisan electoral base that can outmaneuver and outflank the declining electoral bases of the two major parties. She and her supporters within the bloc, and whatever electoral coalitions they create can use IVCS tools and databases to continuously hone their policy agenda, and expand their electoral base to counter the fiscally conservative, special interest-backed agendas that the two parties (and possibly the third major party in formation) will be trying to foist off on a hapless public, which would be without recourse were it not for IVCS.

The game-changing nature of IVCS will further provide a paradigm-shifting reference point and perspective not only for a voting bloc supporting Warren in Massachusetts; but also for other voting blocs in other states running insurgents against major party regulars. As IVCS-enabled voting blocs take the place of traditional political parties as the reference point for political activists as well as mainstream voters, they will engender viewpoints among their members that defy contemporary dogmas and reject traditional political discourse presented to them by the corporate-controlled mainstream media outlets.

As participation in IVCS-enabled voting blocs and coalitions becomes habitual and sustained, political propaganda disseminated by special interests will be dissected and rejected. Corporate political advertising will be critically evaluated by voting bloc members, especially since their advertising messages are by necessity and design very simplistic, while the dialogues, debates and internal communications inside voting blocs will be richer, more layered, and more textured. Typical political mailings will be laughed at. Attempts to divide and distract voters with sensationalism will be viewed as cynical attempts to manipulate the perceptions of voting bloc members. Even the debates among major candidates will be viewed through the reality-based conceptual lenses being developed continuously within the voting blocs. Debates by talking points and disingenuous counterpoints will be recognized for the kabuki they are. And when the post-debate spinmeisters appear to claim victory for their candidates, their views will be quickly dismissed.

In brief, IVCS, and the alternative social/political sphere it will create, will insulate voting bloc members from the special interest-controlled sphere of mass politics and mass political persuasion. The blocs will weaken the power and influence of special interests, and undermine the value of special interest-funded advertising and marketing activities that make it so expensive to run for office.

Remember that the reason why political advertising and marketing messages are effective now is because they are targeted at specific identity groups, and designed to divide the electorate into irreconcilable camps. But when conflict-fomenting marketing and advertising confront new political constituencies that can unite to set common transpartisan agendas and voter-controlled voting blocs with winning electoral bases not under the control of special interests, they will lose their fire power. Will the marketers and advertisers be able to adapt to this new dynamic and figure out how to manipulate it? I don't think so, because they won't be able to keep up with the speed and versatility of voting bloc learning processes, and the continuous adaptations of voting bloc agendas and strategies to emerging political realities.

In early 2012, Massachusetts Senate candidate prospect Elizabeth Warren, together with one or more IVCS-enabled voting blocs eager to support her candidacy, will have the opportunity to reach out to each other, assuming the IVCS website is fully up and running. Given the range of choices available in the IVCS Policy Options Database, and the possibility that voters and candidates can add new options to it, it is quite likely that they can negotiate a common, mutually acceptable policy agenda. Assuming that the voting bloc has put in place an effective strategy for attaining the voting strength that it will need to elect Warren in the primary election against Democratic opponents, and the general election against all other candidates, Warren and the bloc are likely to agree to jointly announce her candidacy.

At this point, the bloc can move quickly toward building the electoral base it will need to garner the approximately 35,000 votes on average it will need in each of the Massachusetts electoral districts to win the primary. Warren’s potential for success in the primary will depend, first and foremost, on what she does. If she works within the confines of the present political system, and declines to join forces with an IVCS voting bloc to use IVCS consensus-building tools to create her own constituency around collective transpartisan agenda-setting, while one of her competitors, say Mike Capuano, the Congressman from the Massachusetts 8th, decides to commit, then the primary campaign will be very hard for her to win.

Moving on to the general election, here Warren will probably need about 1.6 million votes, or an average of 160,000 per Congressional district to win the 2012 Senate race. This assumes that roughly 3 million to 3.2 million people will turn out. It is also worth bearing in mind that there may be a third party candidate running on the No Labels ticket who will be targeting so-called “centrist” voters who have defected from the Democratic and Republican parties, and who will receive substantial backing from fiscal conservatives who think that the political stalemate created by the unpopular Democratic and Republican parties is harming the nation’s ability to solve its pressing crises. In this case, the candidates running on the Republican and No Labels ticket will draw votes from a Democratic ticket led by Obama at the top.

So even if Elizabeth Warren wins the Massachusetts Democratic primary, registered Democratic party voters may continue to decline, so disaffected are they with party performance at all levels. Their defection is likely to prevent Warren from winning on the basis of Democratic voters alone. Given her track record in attempting to regulate predatory bankers and financial institutions, she will be at a great disadvantage in competing against candidates like Scott Brown who will be heavily financed by them. So she will not be able to win the general election with only Democratic votes or with traditional Democratic funders.

But she can turn this necessity into a virtue by working with the IVCS voting bloc to forge a transpartisan electoral base. Elizabeth Warren has been a champion of the middle class for some time, and a general election campaign spear-headed by an IVCS voting bloc would enable her to involve middle class voters across the political spectrum in crafting a transpartisan agenda that addresses their economic and financial distress.

Logistically, her IVCS voting bloc would go all out to use IVCS consensus-building tools to forge a winning electoral coalition and mobilize its voters to go to the polls to ensure that Warren wins the general election in 2012. Given overwhelming voter dissatisfaction with establishment incumbents candidates, which is likely to remain unchanged by election day, and the capability of IVCS to forge electoral coalitions whose members espouse the similar policy priorities, and who are motivated to work for the electoral coalition and those they support, I think it's very likely that an IVCS electoral coalition supporting Warren can deliver the 1.6 million votes that it will need to elect Warren and upset Scott Brown.

(Cross-posted at All Life Is Problem Solving and Fiscal Sustainability).

How Voters Can Get Control of the 2012 Virginia Senate Race

Joseph M. Firestone — Wed, 23 Feb 2011 23:50:17 -0500

The 2012 Virginia Senate race is shaping up as a contest between former Governor and Senator George F. Allen, and former Governor Tim Kaine, both establishment candidates in the legacy parties and heavily favored to win their respective nominations. They will couch their messages in terms calculated to resonate with Virginia voters. But once elected, if recent history is any guide, their legislative priorities will diverge significantly from the priorities of the voters who elect them because they will be heavily influenced by special interests that finance their campaigns.

The Interactive Voter Choice System (IVCS), when fully developed, enables Virginia voters to upset their respective apple carts. In my last post, I described its potential impact on Jim Moran's next campaign in Virginia's 8th Congressional District, and explained how the IVCS could lead to the formation of a voting bloc or electoral coalition that could make Jim Moran, or an alternative candidate selected by the voting bloc, accountable to the voting bloc or coalition and its policy agenda. In this post, I'll do a similar analysis of the Senate race focusing on Tim Kaine.

Tim Kaine

Tim Kaine has had a notable career as a Democratic Party centrist. As an attorney he built a very good reputation as an advocate for victims of housing bias based on race and disabilities. In 1994, after 10 years of practice, he was elected to the Richmond City Council. In 1998, the Council elected him Mayor of Richmond. In 2001, he was elected to the position of Lieutenant Governor with 925,974 votes, 50.35% of the total. This was a narrow win, but Kaine had become closely associated with the very popular Mark Warner during his term, and in 2005, with Warner's strong support, he was elected Governor with 1,025,942 votes, 51.72% of the total, a margin of 6% over his Republican opponent Jerry Kilgore.

Kaine governed as a centrist. He balanced the budget, emphasized transportation development and funding, continued Warner's strong support for education, emphasized conservation, signed an Executive Order banning smoking, and, in general, tried to promote balanced growth for the State. Kaine has been a strong supporter and friend of Barack Obama who named him to chair the Democratic National Committee. He was on Obama's short list for the Vice Presidential nomination, and the president has recently indicated that he thinks Tim Kaine, who has yet to formally announce his candidacy for the US Senate, would make a fine successor to the departing Jim Webb. Since George Allen has announced his candidacy for the 2012 US Senate race in Virginia on the Republican line, it's becoming increasingly likely that Tim Kaine will be the Democratic Party's choice to try to hold that Senate seat for the Democrats against George Allen's attempt to return to the Senate.

Visualizing the Potential Impact of the IVCS on Tim Kaine and the Democratic Party

In my last post analyzing the potential impact of the IVCS on Jim Moran's upcoming re-election campaign, and also in a number of others, I've written about how the IVCS environment will enable its members to form initially small voting blocs around specific policy agendas and then how, through problem solving, collaboration, negotiation and compromise, aided by IVCS social networking facilities, smaller voting blocs can aggregate into ever larger ones, and finally into electoral coalitions unifying millions of people in support of a policy agenda they share. If you're interested in these details please read the posts linked to above and also "2012: How U.S. Voters Can Wrest Control of Congress from Special Interests", and then try to visualize how things might work in the US Senate race coming up in Virginia in 2012.

Start by generalizing the scenario I provided for Jim Moran's Congressional race in the Virginia 8th to all 11 Congressional Districts in Virginia. In the Congressional scenario, I highlighted trans-partisan voting blocs that were focused on the 8th Congressional District. But the IVCS enables such voting blocs and electoral coalitions to easily organize on a cross-district basis because it is web-based and uses social networking technologies to interconnect voters with similar policy priorities irrespective of where they live. In fact, the natural mode of voting bloc organization is initially around policy options and policy agendas, not around specific election districts. So we are as likely to see cross-district, and even cross-state voting blocs emerge and organize around policy options and agendas as we are to see them focus their memberships to conform to political boundaries like local, state, and Congressional District boundaries in order to further those agendas. Given the demographics of Congressional Districts, they are likely to provide voting blocs the most fertile ground for initially flexing their political muscles. Once the voting blocs start organizing by Congressional Districts, however, they will quickly recognize that they can also mount campaigns and primary challenges to major party incumbents and favored candidates for any offices elected by state voters, whether they are local, state or federal. So, let's visualize the situation in Virginia in a typical House and Senate election year, assuming the IVCS is in place.

First, let's take a typical House election year. To get a candidate on the ballot and ensure a primary challenge to at least one of the major Party candidates in each District, the IVCS voting block in each of the 11 Congressional Districts would need to gather at least 1500 petition signatures from qualified voters per district, for a total of at least 16,500 signatures.

Second, let's take a Senate race. To meet state requirements for getting a single primary candidate for the US Senate in Virginia on the primary election ballot, it would be very easy for IVCS voting bloc members to gather another 1500 in each District, that is, another 16,500, at the same time. Since Virginia requires 10,000 qualified voters total and at least 400 from each of its 11 Congressional Districts, and recommends that 15,000 – 20,000 be gathered with at least 700 from each Congressional District, the voting bloc would easily meet Virginia's requirement for entering a candidate in a major Party primary.

This means that Tim Kaine, currently viewed as a “shoo-in” choice of the Democratic Party, assuming that he decides he will run for the US Senate, could easily face a voting bloc primary challenge in 2012 if there's no agreement between himself and the voting bloc on a common agenda, and the bloc decides to enter its own candidate in the primary. Of course, if there is no agreement between Kaine and the voting bloc on a policy agenda, this divergence doesn't guarantee that Kaine would lose a primary challenge to a voting bloc supported candidate. However, what would favor a voting bloc candidate's victory in the primary is the fact that US Senate primary elections in Virginia have very low turnouts and highly motivated blocs of primary voters can determine the outcome even if their numbers are small. For example, there was a 3.45% turnout for the Jim Webb/Harris Miller Democratic Party primary race in 2004. Jim Webb won with 83,298 votes, which was 53.47 percent of the votes cast.

If Tim Kaine were expecting stiff primary opposition, the Democratic Party could mount a major effort to support him. But considering that the Senate primary race occurs months after the presidential primary in Virginia, the turnout potential for the major parties is much more similar to what it is in an off-year congressional election. Most probably, the most the Party organization would be able to produce is the turnout that occurred in the three-way hotly contested gubernatorial primary of 2009. That primary had a turnout of 6.3%, and was won by Creigh Deeds with close to 158,000 votes, very close to 50% of the approximately 319,000 votes cast.

This previous history suggests that a voting bloc candidate who would be a very safe prospect for an electoral victory in a Virginia US Senate primary would probably require no more than 200,000 votes, or an average of roughly 18,000 per Congressional District. In the 2008 general election, Democrats won 6 of the 11 Virginia Congressional Districts, and 2 of the 3 in Northern Virginia. They received over 200,000 votes in 3 of the 6, and between 140,000 and 200,000 in the other three. They also garnered between 114,000 and 150,000 in each of the 5 Congressional Districts in which they were defeated. In view of these 2008 general election vote totals, and the fair amount of Democratic strength in all Congressional Districts in most regions of the state, an average of 18,000 primary votes in each Congressional District for a Senate candidate it supports seems well within the reach of a statewide voting bloc, since it is less than 10% of the general election total, and we can expect stronger commitments among voting bloc members translating into higher percentage turnouts in primary elections than parties normally receive because IVCS forged social bonds are likely to be much stronger than political party ties.

Considering that Jim Webb won the VA Senate Democratic primary in 2004 with 83,298 votes, even a voting bloc candidate that could command only 100,000 votes, an average of roughly 9,000 per Congressional District, would present a very significant challenge to a Tim Kaine candidacy, and may well persuade him to embrace the voting bloc's agenda in the primary. Whether or not he does that, however, the voting bloc can be expected to easily arrive at the 18,000 average votes needed per District to produce a very safe electoral margin. That's because the number of Democratic voters and other voters of various persuasions whom the voting bloc can bring into the primary is substantial and sufficient to elect the bloc's candidate, due to the following factors:

-- Widespread dissatisfaction of voters across the political spectrum with the legislative track records of known candidates and incumbents of both parties as expressed in polls,

-- Lack of responsiveness of major party candidates and incumbents to mainstream voters' current economic and financial difficulties, as reflected in their inability to develop a job creation strategy that works, a strategy that halts foreclosures and stabilizes the real estate market, a strategy that will clean up the financial system continually victimizing Americans, and a strategy that provides good health care at a stable price that working Americans can afford.

-- The IVCS-enabled voting bloc will be able to use IVCS agenda-setting tools to mobilize disaffected voters to define their policy priorities across the board, rather than being restricted to the confines of party alignments, and participate in creating a written legislative mandate for their candidate.

-- The web-based consensus-building tools of the IVCS will create stronger social ties and loyalties among voting bloc supporters than the legacy Parties can create among voters contemptuous of their prior track records.

These four factors will make it possible for the IVCS-enabled bloc to create a larger electoral base of motivated voters than Kaine's base of disaffected Democrats, and in turn lead to a higher turnout, and it will also allow the bloc to do that without recourse to large amounts of campaign money because if its use of IVCS organizing facilities. Since the requirement of 200,000 votes is less than 5% of the total votes available, it's not a very high bar to overcome.

As with the scenario I outlined for Jim Moran's upcoming re-election effort, if Tim Kaine earned the backing of the voting bloc in the primary in exchange for supporting its agenda, and then won the primary with the votes of the voting bloc, the bloc could keep the pressure on Kaine during the general election by putting up a "back-up" candidate on the Independent line or on the line of a third party. The bloc could shift its support to this candidate in the event Kaine reneged on his support of the bloc's agenda during the campaign. On the other hand, if Kaine maintained his advocacy of the bloc's agenda, then the bloc would go all out to use IVCS consensus-building tools to forge a winning electoral coalition and drive its voters to the polls to ensure that Kaine wins the general election in 2012.

The 2008 Senate race was won by Mark Warner with a total of 2.37 million votes (65% of the 3.64 million votes cast). That race had a high turnout of about 72.4% of the total number of registered voters since it was held during the 2008 presidential election. Assuming that it's unlikely that turnout in 2012 would exceed 75% of the total number of registered voters in the Senate race, and that total votes would exceed 3.9 million, then I infer that a safe total needed by Kaine or any of his opponents to win would be about 2 million votes.

The requirement for IVCS then, is to deliver an average of 182,00 votes per Congressional District, to ensure the election of Tim Kaine, provided that he remains committed to the voting bloc's agenda, or its alternative candidate, if he defaults on his commitment to the bloc's agenda. If turnout is less than 75% and the growth in registered voters is less than I've projected, then the requirement might fall to as low as an average of 162,000, many less than the average of 215,000 who voted for Mark Warner.

Can an IVCS-enabled voting bloc build an electoral base with 2 million+ voters? I think it can, because it can use the broad repertory of IVCS web-based consensus-building tools, including an online Voting Utility, to forge a winning electoral coalition with other voting blocs, political parties, labor unions and grassroots advocacy groups. It can do this by involving Virginia voters in setting an agenda FAR MORE to their liking than anything that Tim Kaine can come up with. That agenda can be transpartisan and incorporate priorities that the Democratic Party and Kaine's special interest campaign contributors would normally oppose, priorities like direct federal job creation, Medicare for All, etc. The voting bloc could mobilize many very angry and eligible voters who have been staying away from the polls, once they see it get a commitment from Tim Kaine to support an agenda that they participated in formulating with no special interest influence as part of the process.

To accomplish this, the voting bloc or electoral coalition most likely will have to agree on a more broadly shared agenda than those that were agreed upon for the Congressional elections and candidates. Generally speaking, the diversity of opinion in any of the 50 states may well be greater than the diversity in any one Congressional District. So, the shared policy agenda negotiated by the members of the statewide Senatorial voting bloc may well require more prolonged negotiation and turn out to be more diverse in its policy options than the shared policy agendas of Congressional District voting blocs. Members of the statewide Senatorial voting blocs will need to negotiate the policy priorities to be included in these shared agendas, and here the IVCS consensus-building tools, particularly the Voting Utility, will facilitate setting the broader shared agendas that will be required to create the broader electoral base that the bloc will need to obtain Kaine's support for its agenda AND get him elected in an anti-incumbent era.

With skillful negotiation, and a willingness to compromise, the statewide Senatorial voting blocs will be able to bring broad cross-sections of voters into winning, broad-based electoral coalitions that override the vitriolic divisiveness engendered by the legacy parties. This will be a further development of the bottom-up democratic process that leads to voting bloc emergence, and that intensifies the sense of belonging, loyalty and commitment that people will have to the voting blocs.

Generally speaking, as these voting blocs rack up electoral victories in major party primaries throughout the country, they will begin to democratize and revitalize the major parties, by ensuring that voters control their agendas and determine who wins their elections. In the case of the Virginia Senate race, success in the 2012 Congressional and Senatorial races, coupled with outreach to party officials and membership to persuade them to align their efforts with those of IVCS-enabled voting blocs, will accelerate the democratization and revitalization of the Democratic Party of Virginia and its alignment with its historic mission of representing mainstream Americans, rather than special interests.

Conclusion

This post continues my analysis of how the IVCS will work to empower the U.S. electorate to wrest control of elections from special interests. My previous post on the IVCS and Jim Moran, outlined how things would work at the Congressional level. This post extends the analysis to the level of the election for the US Senate in Virginia.

The Democrats are in a ditch of their own making in Virginia, because of their very poor performance in Congress since the President's election, and his own failure to ease the pain of mainstream Americans, while he created the conditions that have allowed the very well-off to further increase their wealth. Tim Kaine's close association and friendship with Obama, and his identification as a centrist, organizational Democrat, could be a real deal-killer for many 2012 Virginia voters, in spite of the fact that Kaine was a popular Governor. That's because of high unemployment rates, for which Obama is now blamed, and because Kaine may simply have too much baggage to carry to be successful in a conventional party campaign in an anti-incumbent era in which special interest-funded right wing fringe groups like the Tea Party have taken center stage in non-stop media wars. Moreover, even though the big money he will likely get from the Democratic Senatorial Campaign Committee and special interests may help him with political messaging ads, the ads, and the money used to pay for them, may well add to that baggage by providing tangible proof of his association with interests widely held in contempt by voters.

George Allen may well run a full-throated Tea Party campaign that will pull out hordes of conservatives, Christian fundamentalists and Tea Party regulars. In such an environment, only an IVCS-enabled voting bloc capable of building a broad-based electoral coalition around voter-set agendas and getting out the vote without the aid of big money, could pull Kaine's irons out of the fire, in terms of setting an appealing transpartisan (but not right wing) agenda that would attract the electoral base he needs to get those 2 million+ votes.

I believe that scenarios like the ones I've outlined for Virginia are generalizable across the country, and that Senate candidates, whether incumbent or not, can be persuaded to commit to, and also adhere to, agendas formulated by the voting blocs, especially since the blocs will offer the prospect of delivering large numbers of committed voters at very low cost. If this is correct, it means that voters can disconnect the two major parties from their corporate and special interest bonds and make them responsible to broad-based popular needs and desires once again. My next post will continue this analysis at the presidential election level and analyze the potential impact of the IVCS on the 2012 Presidential election and its aftermath.

(Cross-posted at All Life Is Problem Solving and Fiscal Sustainability).

Miller: Picking on Poor Kids isn't Tough

Robert Borosage — Thu, 17 Feb 2011 14:38:59 -0500

Rep. George Miller calling out mock tough conservatives -- and Gov Christie for that matter. What is the measure of political courage? It isn't tough to kick poor kids. Finally someone challenges the bullies.

From the interview:

"All morning long people have been talking about ‘tough cuts’ –it’s not tough to take money away from a poor child. It’s not tough to kick a child out of Head Start. You want to do something tough? Take away tax breaks from the hedge fund managers that don’t’ deserve it… Make the oil companies pay the royalties that the taxpayers of this country are owed. That’s tough. You know why? ‘cause they can fight back. Head Start parents don’t get to fight back very much. Poor children don’t get to fight back very much"

Watch full the interview.

Corruption of Senate Healthcare Bill Revealed, Using Middle-School Math

Michael Lemke — Thu, 04 Feb 2010 18:58:37 -0500

The shocking corruption of the Senate health care bill revealed, using just two facts (helpfully supplied by the Senate itself) and a little middle-school math

On Christmas Eve, the Senate passed its long-awaited health care reform bill. This post proves the colossal stupidity and corruption of the so-called “Patient Protection and Affordable Care Act”—using only two facts (helpfully supplied by the Senate itself) and a little middle-school math.

Part I: The Core of the Stupidity: Two Little Facts

Let’s get right to it. Section 2718 of the Senate bill provides that

Health insurance companies will be required to report publicly the percentage of total premium revenue that is expended on clinical services, and quality rather than administrative costs. Health insurance companies will be required to refund each enrollee by the amount by which premium revenue expended by the health insurer for non-claims costs exceeds 20 percent in the group market and 25 percent in the individual market. The requirement to provide a refund expires on December 31, 2013, but the requirement to report percentages continues.[1]

The Senate document in which this summary appears presents Section 2718 as a good idea for ordinary Americans—the summary is included under the heading “Bringing Down the Cost of Healthcare Coverage.” But what does this provision really mean?

“Refunds” to patients sound good at first, but what the Senate is really saying here is that the Senate bill requires private insurers to spend only 75 to 80 percent of every premium dollar on actual health care. OK, so what does that mean?

Let’s put it another way: the Senate bill authorizes private insurers to consume 20 to 25 percent of every premium dollar on administrative costs.

But according to the Senate’s own data, ordinary Medicare's administrative costs are only 2%.[2] In other words, if we simply opened ordinary Medicare to uninsured Americans, 98 cents of every Medicare dollar would buy actual health care.

Believe it or not, the two little facts given above—that 20 to 25% figure, and that 2%— are enough to prove, without any other information, the colossal stupidity and shocking corruption of the so-called “Patient Protection and Affordable Care Act.”

Part II: A Few Simple Definitions.

Before we get started, let’s make sure we know what we are talking about. Let’s define some basic terms, so that everyone can understand the argument.

Obviously, the Real Product of the health care sector is health care. Just as obviously, Real Product is good. Rational “buyers” (individuals, taxpayers, or businesses[3]) want to buy as much Real Product (actual health care) as possible at the lowest possible total cost.

Let’s define the Production Cost of a given amount of health care as the price that the producer (the doctor or hospital) charges an “insurer” or “payer” in order to provide that amount of Real Product (i.e., health care) to the “buyer” (i.e., the patient).

And let’s define the Administrative Cost of a given amount of health care as the price that the “insurer” or “payer” charges for providing the service that it provides—i.e., “payer” service—that is, collecting funds from the “buyer” and writing a check to pay the provider to provide that amount of Real Product to the “buyer.”

Note that the “insurer” or “payer” adds no value to the real health care product and doesn’t contribute to its production or quality in any way.[4] All the “insurer” or “payer” does that is of any use to the “buyer” or “patient” is to collect buyers’ money and write checks to buy Real Product from providers. Thus, every dollar that the “insurer” consumes in Administrative Cost represents one less dollar of Real Product that the “buyer” can afford to buy.[5] In other words, Administrative cost is bad. Very bad.

Just a few more definitions. First, the Total Cost of a given amount of health care is the sum of the Production Cost and the Administrative Cost (that is, the actual amount that the “buyer” or “patient” must spend to acquire the Real Product, health care, via the “payer” or “insurer”). And just as obviously, the goal of a rational buyer is to make Total Cost as low as possible, by minimizing Administrative Cost, so as to be able to buy as much Real Product as possible, at the lowest possible cost.

Let’s define the Medicare Cost of a given amount of health care as the Total Cost to buy that amount of health care through ordinary Medicare.

And let’s define the Private Insurer Cost of a given amount of health care as the Total Cost to buy that amount of health care through private insurers under the Senate plan.

So far, so good. Already you are probably beginning to draw some conclusions of your own (especially if you have reviewed the facts in Part I). But don’t jump to conclusions—if your middle-school math is a little rusty, you may be in for a bit of a shock.

Let’s add one last definition. Let’s say that the Administrative Cost Wedge of an “insurer” or “payer” is its Administrative Cost expressed as a percentage of Production Cost. This is a very important concept which the next section explains in detail.

Part III: Mind-Blowing Secrets of the Senate Revealed, Using Middle-School Math

Obviously, a smart buyer who wants to buy as much Real Product (actual health care) as possible [6] should figure out the Administrative Cost Wedge of each potential “insurer,” so as to be able to predict how much that insurer’s “money collection and check-writing service” will increase the Total Cost of Real Product. But how do we figure out this Cost Wedge under the Senate bill? For that we need our middle-school math.

Get ready for some sticker shock. A hasty person might leap to the conclusion that because ordinary Medicare consumes in Administrative Cost 2% of every dollar it receives from “buyers,” Medicare’s Administrative Cost Wedge must be 2%.

Similarly, a non-math-major might assume that because private insurers under the Senate bill would consume in Administrative Cost 20 to 25% of every premium dollar, that the Administrative Cost Wedge of private insurers must be 20 to 25%—and that therefore, if we want to figure out the Private Insurer Cost (i.e., the Total Cost to buy a given amount of health care using a Private Insurer under the Senate plan), we simply need to add 20 to 25% to the Production Cost.

These assumptions are completely and utterly wrong. Surprised? Here’s why.

Suppose (for simplicity’s sake) that the Production Cost of the amount of Real Product that we want to buy is $100. In order to figure out the Medicare Cost for that amount of Real Product, we need to solve the following middle-school equation:

0.98 x M = 100.

Thus we find that M, Medicare Cost, is not $102.00, but $102.0408. OK—; so far so good. To figure out the range for Private Insurer Cost, we need to solve two equations:

0.80 x P1 = 100 and 0.75 x P2 = 100.

Solving them, we find that the Private Insurer Cost to buy $100 of Real Product is not $120.00 to $125.00, as a non-math major might guess, but $125.00 to $133.3333. [7]

Thus, Medicare’s Administrative Cost to buy $100 of healthcare is $2.04, and Private Insurers’ Cost to buy $100 of healthcare ranges between $25.00 and $33.33. [8] Put differently, ordinary Medicare adds 2.04% to the Total Cost of Real Product, whereas Private Insurers under the Senate plan increase the Total Cost of Real Product by 25 to 33.33%.

As it happens, we have just solved for the Administrative Cost Wedge of the available “payers” or “insurers.” Ordinary Medicare’s Administrative Cost Wedge is 2.04%; and Private Insurers’ Administrative Cost Wedge under the Senate bill is 25 to 33.33%.

Quite a contrast in “Administrative Cost Wedge,” isn’t it? But hold your horses! There’s more to this than you might think, as the next section will show.

Part IV. Read This Section and Make Naked Senators Weep!

Okay, we’ve done some Einstein-level math here and need a break. Let’s work with words again for a few paragraphs. Obviously, a smart buyer who wants to buy as much Real Product as possible at the lowest possible Total Cost should pick the “insurer” with the smallest possible Administrative Cost Wedge. But how do we compare “insurers”?

A few more definitions might come in handy. So let’s define the Real Cost of a given amount of healthcare as the lowest possible Total Cost at which a smart “buyer” can buy that amount of Real Product. (In other words, Real Cost is the sum of (1) the Production Cost of the provider and (2) the Administrative Cost of the least expensive “insurer.”)

And (just for the heck of it, since logic apparently isn’t in fashion in the Senate) let’s define any portion of Total Cost for a particular insurer that exceeds Real Cost as Waste.

Given the “insurers” or “payers” under consideration here, we can conclude that
1. the Real Cost of healthcare = the Medicare Cost of healthcare, [9] and
2. the Private Insurer Cost of healthcare = the Medicare Cost of healthcare + Waste.

But how much Waste? Let’s try one more definition: the Administrative Cost Wedge Differential[10] is the difference between (1) the Administrative Cost Wedge of a particular “insurer” and (2) the lowest available Administrative Cost Wedge (i.e., the Administrative Cost Wedge of the least expensive “payer” or “insurer”).

Now obviously, if our Senate really wants to “reduce the cost of coverage,” it should cut out Waste entirely. If for some reason [11] our senators have drafted a bill that does not buy “money-collection-and-check-writing” (i.e., “payer”) service from the least expensive “insurer,” but instead buys it from insurers who create staggering Waste, something’s seriously wrong in Washington. So let’s define any amount of Total Cost exceeding Real Cost as Graft, and rename the Cost Wedge Differential the Graft Wedge.

Obviously, applying the equation for the Differential given above, the Graft Wedge for ordinary Medicare is zero [12]; therefore, insuring the uninsured under Medicare would create zero Waste and zero Graft. But the Graft Wedge for Private Insurers ranges between 22.96% (solving for 25% - 2.04%) and 31.29% (solving for 33.33% - 2.04%).[13]

In other words, using private insurers to insure the uninsured (instead of opening Medicare to all Americans) wastes between 22.96 and 31.29% of every health care dollar in completely unjustifiable graft.[14]

In still other words, 23 to 31 cents of every health dollar (given the amount of real work that goes into producing the Real Product) is a heck of a lot to ask buyers, not for the service of writing checks (“payer” service), but for nothing—yes, nothing!—at all.[15] For let’s be very clear: there is no value added in the Graft Wedge. The Graft Wedge just represents colossally stupid waste—and shocking corruption. [16]

Part V: Let’s Draw Those Conclusions: Shocking Stupidity and Corruption of the Senate Health Care Reform Bill Stunningly Revealed.

So our Corporate Democratic Senators called their health care “reform” bill the “the Patient Protection and Affordable Health Care Act”—but it is really quite the opposite.

This is actually the “Screw the Patients and Increase the Cost of Healthcare by 23 to 31%, For Absolutely No Good Reason At All Act.”

It should be obvious by now that this bill does not protect patients. The only “protection” here is for private insurers. Compelling ordinary Americans to pay private insurers between 22.96% and 31.29% of every dollar in sheer graft, for no service or product, but merely to let patients have access to health care they could buy a heck of a lot more cheaply through Medicare, counts for “protection money” in my book.

But the problem is not just that Private Insurer Graft represents a huge amount of patients’ money lost. It also represents huge amounts of health care lost.

Suppose that the amount of health care we need to buy is actually $100 billion.
Medicare Cost would be $102.04 billion. Private Insurer Cost would range between $125 billion and $133.33 billion. In other words, Private Insurers would consume between $22.96 billion and $31.29 billion in Graft. But that Graft money, if instead plowed into Medicare, would buy between $22.5 billion (i.e., 0.98 x $22.96 billion) and $30.66 billion (i.e., 0.98 x $31.29 billion) of additional Real Product (i.e., health care).

In other words, if we use ordinary Medicare instead of private insurers to insure the uninsured, we can save $22.96 billion to $31.29 billion dollars for every $100 billion of healthcare we buy; or again: when we use Medicare instead of private insurers to buy health care, we can buy 22.5% to 30.66% more health care for the same price.[17]

So why do our Senators want us to pay wasteful private insurers a 22.96%-to-31.29% Graft Wedge, for no value, product, good, or service in exchange—unjustifiably and perversely increasing the cost of health care by 22.96 to 31.29%?

Seriously—what are we supposed to think when in the worst recession in over 70 years, with 10% unemployment [18] and deficits of over a trillion dollars a year, Corporate Democrats like Max Baucus and Ben Nelson in the Senate, given a voter mandate to find a way to “protect patients” and make health care “affordable” for Americans, come up with an outrageous scheme like that?

And what are we supposed to think of a President who does not educate us in this math?

Well, there you have it.

The Stupidity and Corruption of the Senate bill has been proven as promised—using only two facts, helpfully provided by the Senate itself—and a little middle-school math.

Obviously, the real Corruption here is in the Congress. And just as obviously, the real Stupidity is in the American people, if we let Congress force us to buy private insurance for the uninsured under its corrupt “Protection Money” Act, instead of opening ordinary Medicare to all Americans.

We need Improved Medicare for All. [19]

If Corporate Democrats don’t wake up to the basic math in “healthcare reform,” they sure as hell aren’t going to like the math of the next elections!

__________
END NOTES

[1] “The Patient Protection and Affordable Care Act as Passed: Section‐by‐Section Analysis,” U.S. Senate, January 26, 2009 at http://dpc.senate.gov/healthreformbill/healthbill49.pdf.

[2] Paul Krugman, “Administrative Costs,” July 6, 2009, New York Times, http://krugman.blogs.nytimes.com/2009/07/06/administrative-costs/.), citing a study by Jacob Hacker at http://institute.ourfuture.org/files/Jacob_Hacker_Public_Plan_Choice.pdf, itself citing a Congressional Budget Office report at http://www.cbo.gov/ftpdocs/76xx/doc7697/12-08-Medicare.pdf.

[3] In reality, of course, “businesses” are not truly “buyers” of healthcare. The real “buyers” of “employer” insurance are workers and taxpayers. (The workers have contracted for the health insurance in lieu of other compensation, and the taxpayers subsidize purchase of healthcare for workers, by not charging employers income tax on money spent to buy employee healthcare, and not charging workers income tax on income accepted in the form of health insurance.)

[4] That is why alarmist talk about a “government takeover” of healthcare is nonsense. The reality is that Medicare is simply a mechanism for collecting money and writing checks to pay private-sector doctors and hospitals for providing the real product—healthcare—to patients. In this regard, Medicare is precisely the same as private insurers, with the notable difference that it is the purpose of Medicare to charge as little as possible for providing that check-writing service—while it is the purpose of private insurers to charge as much as possible for providing the same service.

[5] Thus, any increase in administrative cost over the minimal possible value is 100% dead loss for the “buyer,” adding no value, and in fact depriving the buyer of a corresponding amount of actual product.

[6] i.e., a buyer who wants to “protect” patients and make health care “affordable”

[7] Yes, this is really how the universe works. If you don’t get it, go visit your 7th-grade math teacher.

[8] I think we can all safely agree that $33.33 is a pretty stiff charge to write a $100 check.

[9] Because Medicare is the least expensive insurer with the lowest Administrative Cost Wedge, providing the lowest possible Total Cost (i.e., the “Real Cost”).

[10] We can also define the Administrative Cost Wedge Differential as Dead Loss to the “buyer,” because it is the amount of the insurer’s Administrative Cost Wedge that represents pure Waste (i.e., it does not even provide the service of collecting money and writing checks; it in fact provides nothing at all).

[11] (such as fat campaign donations and the promise of revolving-door payoffs)

[12] Because Medicare is by far the least expensive insurer, with by far the lowest Administrative Cost Wedge—so that the lowest possible Total Cost for the product (i.e., the “Real Cost”) is Medicare Cost.

[13] Again, if you are having trouble with this, check in with your middle-school math teacher. It really is true.

[14] The reality, of course, is that all individuals who currently pay for private insurance directly, and all workers and taxpayers who buy “employee” health insurance through employers, are already paying a similar Graft Wedge to these inefficient private insurers. Image the vast cost savings if we opened Medicare to employers—i.e., if we gave “employers” (i.e., workers and taxpayers) the right to buy ordinary Medicare for employees—paying only the Real Cost of healthcare—instead of forcing them to pay private insurers a massive cost wedge for no reason at all!

[15] The Graft Wedge, for example, does not even buy the service of collecting money and writing checks, because it represents Private Insurer Cost in excess of the Real Cost of healthcare (i.e., the Total Cost of using Medicare to pay for health care—including its total Administrative Cost for the service of collecting money and writing checks.)

[16] In actuality, Medicare is (in theory at least) able to negotiate better prices with providers than Private Insurers, in part because (if permitted to use it) it has greater bargaining leverage because of monopsony buying power—and in part because working with ordinary Medicare instead of thousands of private insurer plans reduces providers’ own billing costs. The reality is that a “single payer” is by far the most efficient way of collecting money and writing checks to pay providers for their product. (If individual “buyers” were the “payers” for health care, for example, doctors and hospitals would have to vastly expand their billing departments as they struggled to collect bills from 300 million individual payers—adding substantially to production cost.)

[17] See, e.g., “State Jobless Rates on the Rise,” January 22, 2010. http://money.cnn.com/2010/01/22/news/economy/state_unemployment.

[18] Improved Medicare for all would save Americans $400 billion a year in graft—more than four times the amount needed to insure all of the uninsured using ordinary Medicare. For more information about Improved Medicare for All, go to the Physicians for a National Health Program, at http://www.pnhp.org.

Madoff: Fall Guy or First of Many?

Eric Lotke — Mon, 29 Jun 2009 16:08:58 -0400

Bernard Madoff has been sentenced to 150 years in prison for one of the biggest investment frauds in Wall Street history. The punishment seems to fit the crime....

But there is no closure here. We can’t let Madoff’s sentence distract us from the underlying problems.

This isn’t just about Madoff. This is about the system in which Madoff’s scam took place. This is about systemic fraud and malpractice, the cultural trade of due diligence for easy profit. It’s about conflicts of interest where companies paid ratings agencies for their ratings. It’s about ideological blinders that let regulators and the Federal Reserve look the other way while banks turned into betting parlors.

So Madoff got 150 years for breaking into the bank. Fine.

But what about the guard who was asleep out front? What about the clerk who forgot to lock the door? What about the $300 billion that Citigroup walked out with from one vault, and the $200 billion that AIG took from another? Does anybody know where that money went or what we got for it? Don’t they get in trouble too? Did you know that, or do you know why, Goldman Sachs is paying its biggest bonus payouts in its 140 year history?

That’s why we need a Pecora Commission. We’ve been calling for a “grand inquest” in the spirit of Ferdinand Pecora, the fierce New York City prosecutor who investigated the crash of 1929 as general counsel of the Senate Banking and Currency Committee. Pecora hauled the robber barons into daylight and dismantled them on public cross examination. He subpoenaed the documents, dug behind the deals and took testimony under oath. His efforts paved the way for the regulatory reforms — the Securities Act of 1933, the Glass-Steagall Act of 1933 and the Securities Exchange Act of 1934 — that held the house together until modern conservatives took them apart in the name of efficient deregulation.

To its credit, Congress is leaning towards a do-over. It created the new Financial Crisis Inquiry Commission to investigate how fraud, regulatory lapses, monetary policy, and obscure accounting and lending practices contributed to the current financial crisis. After much opposition, the Commission even has subpoena power.

All the Commission needs now — and fast — is members. Real ones, with fire in their bellies. Members who aren’t afraid to put people in jail.

This isn't just about politics. Fundamental financial reform is essential to the future of the economy and the country. President Obama is right to warn that we can't go back to an economy where we spend more than we earn, and where finance captures 40 percent of the country’s profits. He's right to condemn the culture of "arrogance and greed" that took over Wall Street.

Now is the time. If we don't get comprehensive financial reform now, we're setting up even bigger dangers in the future — banks and financial firms officially recognized “as too big to fail,” who think they get to keep the winnings and the public will cover the losses. It’s a gigantic “moral hazard” that doesn’t just leave the vault unlocked, it posts an OPEN sign in the window.

Commission members are expected to be named soon. Will they be ghosts of Ferdinand Pecora? Will they be well-behaved bankers or fiery prosecutors? Will Congressional leaders give them the staff and the budget to dig hard, dig deep and broadcast what they find? Stay tuned. Find a way to turn up the heat. Congress is going to show us who’s in charge.

Private Corporations Control Our Nation's War Endeavors

Alexander Sewell — Fri, 26 Sep 2008 00:00:00 -0400

Seventy percent of the intelligence budget now goes to contractors. Private corporate interests control our nation’s most sensitive information and help direct our most critical foreign policy decisions.