Community For Better Health Care

Vol IX, No 19, Jan 11, 2011


In This Issue:

1.                  Featured Article: The Pharmaceutical Industry: Angels or Demons?

2.                  In the News: How Can Science Help Make Sense of the Arizona Massacre?

3.                  International Medicine: Risks vs Benefits of Medical Tourism 

4.                  Medicare: Emergency Medical Services: How Health Reform Could Hurt First Responders

5.                  Medical Gluttony: EMR—Medical Inefficiency

6.                  Medical Myths: If you believe that a new entitlement saves money, you'll believe anything

7.                  Overheard in the Medical Staff Lounge: ObamaCare is affecting access to care, adversely

8.                  Voices of Medicine: Obama employs regulatory power plays

9.                  The Bookshelf: "When Money Dies" remains a fascinating and disturbing book.

10.              Hippocrates & His Kin: The Modern Challenges of being Doctors

11.              Related Organizations: Restoring Accountability in HealthCare, Government and Society

Words of Wisdom, Recent Postings, In Memoriam . . .

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The Annual World Health Care Congress, a market of ideas, co-sponsored by The Wall Street Journal, is the most prestigious meeting of chief and senior executives from all sectors of health care. Renowned authorities and practitioners assemble to present recent results and to develop innovative strategies that foster the creation of a cost-effective and accountable U.S. health-care system. The extraordinary conference agenda includes compelling keynote panel discussions, authoritative industry speakers, international best practices, and recently released case-study data. The 8th Annual World Health Care Congress will be held April 4-6, 2011 at the Gaylord Convention Center, Washington DC. For more information, visit The future is occurring NOW.

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1.      Featured Article: The Pharmaceutical Industry: Angels or Demons?

Policy and Medicine; Supporting Innovation through collaboration

Over the past several years, journalism and its practitioners have strayed far from its mission, and many "journalists" today do not have much worldly knowledge about or deeper context of the stories they cover. As a result, Michael Kirsch, MD, a gastroenterologist, explained in a recent article that this change in journalism has considerably narrowed the gap between hard news and tabloid sensationalism.

According to his article entitled, "The Pharmaceutical Industry: Angels or Demons?," which was published in the American Journal of Gastroenterology, Dr. Kirsch is "disappointed by the state of journalism and its practitioners today," because reporting "now routinely demonizes individuals and institutions."

While some argue that it is the press's responsibility to "shine light on the darker corners of society," why is it never news when a business is functioning in a legal and ethical manner? Instead, the current state of journalism has exposed the public to an imbalance of negative news.

Consequently, Dr. Kirsch explains that with a focus on the negative news only, the public loses a fair and proper context of the issues. "When we repeatedly read about demons and villains, we may not appreciate that there are angels hiding in the story that we cannot see. This is one reason why cynicism has crept into the public's consciousness. However, just because something has been demonized doesn't mean that it's a true demon."

He noted that media has targeted people and institutions including Wall Street, Oil companies, and the pharmaceutical industry. In looking closer at "Big Pharma," Dr. Kirsch notes that the press and various pundits immediately identify an institution as nefarious by use of the prefix "Big." He asserts that this kind of press coverage of the pharmaceutical companies has been unfairly negative for years because the news routinely reports and editorializes about:

·                     It earns unconscionable profits.

·                     It is regularly fined for aggressive and illegal marketing to physicians.

·                     It hires ghostwriters to pad the medical literature with favorable articles.

·                     It buries research in order to cover up dangerous side effects.

·                     It tries to silence or disparage industry critics.

·                     It purchases physician loyalty.

·                     It schemes to sabotage generic competitors.

·                     It gouges the public.

·                     Its priority is profits, not patients.

Dr. Kirsch makes it clear that he is "not defending the drug industry, or suggesting that the points above have no merit." He acknowledges that he does not work with the industry "and receives nothing of value from them, except for periodic free food for me and my staff." . . .

While the press account may suggest a "Big" cover-up, Dr. Kirsch asks, is this really fair? He explains that every "drug, medical device, medical treatment, and diagnostic test has negative research findings in its files." Medical science proceeds in a zigzag fashion, and conflicting results are expected. Even the safest drugs on the market today have research and opinions that are off the curve. As a result, Dr. Kirsch recognizes that the "only instance when we can be assured that a medical paper has no dissent in the literature is when only one study has been published."

Next, Dr. Kirsch acknowledges criticisms from news that drug prices are too high. However, "can we expect this industry, or any business, to spend a fortune on research and development, with high risks of product failure at any point in development or afterward, without the promise of many years of high profits? Would you invest a fortune in a business venture that faced similar risks without the hope of a generous return on investment?"

Unfortunately, journalists who create sensational stories about high drug prices often neglect to inform the public that it takes years of study and FDA applications to push a drug through the tortured process toward final approval, and that the majority of drugs under study never reach a pharmacy shelf. . .

With respect to pharmaceutical representatives, Dr. Kirsch believes that sanctions are appropriate when those individuals advocate unapproved drug indications in physicians' offices, but he feels that "current regulations are overly restrictive in muzzling reps on discussing off-label use, particularly since physicians prescribe drugs off label every day." In fact, in some cases physicians prescribe medicines exclusively off label.

For example, Dr. Kirsch notes that many gastroenterologists prescribed Xifaxan for hepatic encephalopathy long before it was approved for this use. As a result, he asks whether it helps physicians and patients if reps who came to detail this drug could only discuss the approved indication of treating traveler's diarrhea? While he acknowledges the potential for abuse if reps can wander off label, he asserts that the "boundary is skewed too far in the wrong direction."

Gastroenterologists "prescribe prednisone for ulcerative colitis, Asacol for Crohn's disease, Lialda for collagenous colitis, Flagyl for pseudomembranous colitis, and Protonix for peptic ulcers—all unapproved uses." Accordingly, Dr. Kirsch said that it seems "silly that we can't discuss these treatments with reps who may have deep expertise on these agents." Dr. Kirsch notes that physicians are aware that these are sales folks, not educators. Consequently, he called for "sensible regulations to be devised to promote greater information flow, and still protect against overzealous product promotion."

To Dr. Kirsch however, FDA's recently created "Bad Ad Program," is not very sensible. The program "recruits physicians as its enforcement agents to be on the lookout for false or deceptive drug advertising and promotion." Physicians can anonymously contact the FDA with allegations of marketing malfeasance. Dr. Kirsch calls this program the "Healers & Squealers." . . .


To change the current practices of news coverage and journalism, Dr. Kirsch suggests more balance and context in press coverage of the pharmaceutical industry because "drug companies are the good guys, at least some of the time." Drug companies "spend enormous sums of money on products that will serve humanity." For example, industry delivered for us when we needed H1N1 vaccines in a hurry to protect us against a pandemic.

In addition, the pharmaceutical industry designs, manufactures, and improves medicines to treat disease and keep us well." Moreover, industry has the expertise, experience, and motivation to create new therapies against diseases that resist current treatment strategies." They face economic and legal risks that most of us would never accept. Most drugs under study never make it to market. Sometimes, adverse reactions unrelated to the medication can lead to market withdrawal, which might occur soon after a drug is released."


Today, we need cancer vaccines, immunotherapies, and genetically tailored medicines. We need biologic agents that are more effective and less dangerous to combat a variety of chronic inflammatory and debilitating conditions, such as Crohn's disease. As Dr. Kirsch points out, "are we satisfied with the current state of medicine?"

Drug companies will be a major force that will help to raise medical care and treatment to a higher orbit. If they are motivated to do so for economic gain, then we should recognize that the profit motive can be a force for good. As Dr. Kirsch explains, "if we want this industry to roll the dice on curing or preventing diabetes, arthritis, cancer, stroke, and Alzheimer's disease, then let's give them every incentive to make it happen. Take away the promise of financial reward, and drug companies will pull back and churn out lots of "me too" drugs that we don't really need. We need game changers, not tie breakers."

In the end, Dr. Kirsch asserts that journalists should take the target off the drug industry's backs. "The presumption shouldn't be that this is a diabolical cabal that is nourished by greed. The press needs to demonstrate that they can treat this industry fairly, and we should demand that they do so. They need to restore some of their credibility."

A good way to restore their credibility is for journalists to start using headlines that read "New Drug Helps Millions," and not "New Drug Earns Company Millions."

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2.      In the News: How Can Science Help Make Sense of the Arizona Massacre?

What Causes Someone to Act on Violent Impulses and Commit Murder?

Some people are able to control anger or frustration and channel these feelings to nondestructive outlets. Others, like the gunman accused of killing six people during the assassination attempt on Rep. Gabrielle Giffords, exhibit a frightening lack of control.

 |Scientific American Mind | January 12, 2011 |

People are often confronted with feelings of disappointment, frustration and anger as they interact with government officials, co-workers, family and even fellow commuters. Most can control their actions to the extent that relatively few of these interactions end in violence. The attempted assassination of U.S. Rep. Gabrielle Giffords (D–Ariz.) last weekend shows, however, sometimes the cognitive control mechanisms required to guide one's behavior are either nonexistent or ignored, with disastrous consequences.

Giffords and several others were fired on at close range Saturday during a public gathering for her constituency outside a Tucson, Ariz., supermarket in the representative's home district. Before the shooter could be wrestled to the ground and disarmed six people were dead and 14 wounded, including Giffords who was shot in the head. The accused gunman, 22-year-old Jared Lee Loughner, apparently expressed contempt for the government on a number of issues via MySpace rants and YouTube videos. He allegedly took his grievances with the government and society in general a step further in November when he bought a 9-millimeter Glock 19 handgun and began planning to assassinate Giffords.

The criminal justice system will have to determine the specific motives and mental competency of Loughner, but Scientific American interviewed Marco Iacoboni, a University of California, Los Angeles, professor of psychiatry and biobehavioral sciences and director of the school's Transcranial Magnetic Stimulation Laboratory, about why some individuals act on their violent thoughts whereas others do not. Iacoboni is best known for his work studying mirror neurons, a small circuit of cells in the brain that may be an important element of social cognition.

[An edited transcript of the interview follows.]

What turns anger into action?
Mostly cognitive control, or to use a less technical term, self-control. About a year ago I was in Davos at the World Economic Forum, and we had a dinner-with-talks on intelligence. University of Michigan professor of social psychology Richard Nisbett, the world's greatest authority on intelligence, plainly said that he'd rather have his son being high in self-control than intelligence. Self-control is key to a well-functioning life, because our brain makes us easily [susceptible] to all sorts of influences. Watching a movie showing violent acts predisposes us to act violently. Even just listening to violent rhetoric makes us more inclined to be violent. Ironically, the same mirror neurons that make us empathic make us also very vulnerable to all sorts influences.

This is why control mechanisms are so important. Indeed, after many years of studies on mirror neurons and their functioning we are shifting our lab research to the study of the control mechanisms in the brain for mirror neurons. If you think about it, there must be control mechanisms for mirror neurons. Mirror neurons are cells that fire when I grab a cup of coffee (to give you an example) as well as when I see you grabbing a cup of coffee. So, how come I don't imitate you all the time? The idea is that there are systems in the brain that help us by imitating only "internally"—they dampen the activity of mirror neurons when we simply watch, so that we can still have the sort of "inner imitation" that allows us to empathize with others, without any overt imitation.

The key issue is the balance of power between these control mechanisms that we call top-down—because they are all like executives that control from the top down to the employees—and bottom-up mechanisms, in the opposite direction, like mirror neurons. Whereby perception—watching somebody making an action—influences decisions—making the same action ourselves.

What happens in these individuals is that their cognitive control mechanisms are deranged. Mind you, these individuals are not out-of-control, enraged people. They just use their cognitive control mechanisms in the service of a disturbed goal. There are probably a multitude of factors at play here. The subject is exposed to influences that lead him or her to violent acts—including, unfortunately, not only the violent political rhetoric but also the media coverage of similar acts, as we are doing here. A variety of issues, especially mental health problems that lead to social isolation, lead the subject to a mental state that alters his or her ability to exercise cognitive control in a healthy manner. The cognitive control capacities of the subject get somewhat redirected—we don't quite understand how—toward goals and activities that are violent in a very specific way. Not the violent outburst of somebody who has "lost it" in a bar, punching people right and left. The violence is channeled in a very specific plan, with a very specific target—generally fed by the media through some sort of rhetoric, political or otherwise—with very specific tools, in the Giffords case, a 9-millimeter Glock . . . 

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3.      International Medicine: Risks vs Benefits of Medical Tourism

INTERNATIONAL MEDICINE: Ethical Minefields in Medical Tourism

By Katrina A. Bramstedt, PhD

Crystal blue waves lapping on the beach and glimmering shopping malls with bargains galore. Would you like a little sun, surf and safari with your surgery, all for a price much less than the surgery alone would cost in the United States? It only takes a few clicks of a computer mouse to find enticing lures bundled with cardiac bypass surgery, vision correction, bariatric surgery, organ transplants, dental implants, and total hip arthroplasty.

The high cost of American medical care can drive patients, especially those who are under- or uninsured, to consider participating in these adventures, commonly known as "medical tourism." But let the buyer beware. Despite its rapid growth, medical tourism is largely unregulated. India, for example, projects to see annual revenues of $2 billion from medical tourism by 2012 but has no national guidelines for the practice.[1] Back in the United States, the American Medical Association has issued guidelines for medical tourism, but there are no U.S. regulations that require adherence.[2,3]

Medical tourism entails several ethical concerns. On the matter of informed consent, for example, patients in unrelenting pain or those with chronic, debilitating or life-threatening illnesses are vulnerable to exploitation. If patients are also financially troubled, they become an even larger target for victimization. The combination of their illness burden, its quality-of-life impact, and their lack of finances can result in a mesh of circumstances that impair objectivity during medical decision-making.

If their desperation is significant, patients can unconsciously put on blinders that give a tunnel-vision approach to finding solutions. This situation makes informed consent difficult to obtain. If patients encounter a language barrier, they may have difficulty understanding the medical information that is presented to them. If the hospital or tourism broker is unscrupulous, there may be lack of transparency about important matters such as hospital or facility accreditation, outcomes and safety profile, physician training and certification, follow-up care, and recourse in situations of medical error. . .

Transplant tourists are particularly at risk. They have been known to return to the United States with both an organ (sometimes bought via black markets that use prisoners and the destitute) and an unusual, sometimes fatal infection.[4,5] The money "saved" compared to American health care costs might be spent fixing complications (not covered by insurance) from the overseas surgery or medications. Transplant patients might be lured with false hope and only receive "wallet surgery." . . .

Because medical tourism reaches across geography, there are different laws and policies that can apply to medical error and other problems. In the United States, patients can litigate or arbitrate their cases, but the international world of medical malpractice can be murky. Before embarking on medical tourism, patients need to fully understand their options in responding to matters of medical error. Will the patient get free medical care to correct the matter? Who provides the corrective medical care? Are there monetary damages or other awards for morbidity or mortality? These are serious questions that need to be proactively contemplated before leaving the US, not upon arrival or after a mistake has occurred.

It is important to have a critical lens when looking at medical tourism because there are many unknowns, many problems, and few regulations. Physicians have a duty to impart their wisdom to patients to help guide and protect them when they embark on medical adventures, including medical tourism.

Dr. Bramstedt is a clinical ethicist in private practice in Sausalito.


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Medical Tourism not only gives timely access to healthcare, it also gives access to Medical Risks.

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4.      Medicare: Emergency Medical Services: How Health Reform Could Hurt First Responders

Brief Analysis No. 737

by Peter Swanson, Tuesday, January 11, 2011

The scope of emergency services local governments provide has expanded over the years from fire fighting and rescue to providing advanced medical care, transport and a point-of-access to the health system.  As a result, emergency medical services (EMS) have become more costly.

An estimated 32 million to 34 million individuals will gain public or private health insurance under the Patient Protection and Affordable Care Act (ACA). Insured individuals consume nearly twice as much health care as the uninsured, on the average. Thus, EMS utilization will likely increase; however, the ACA does not provide funds to pay for increased EMS use. This will force local governments to choose between raising taxes, finding alternative revenue sources or reducing emergency services.

Use of Emergency Medical Services. Ambulance trips to hospitals have grown 13 percent from 1997 to 2006, according to the U.S. Centers for Disease Control and Prevention. In 2006, the 18.4 million ambulance transports to hospitals accounted for 15.4 percent of emergency department visits.

Research has shown that the number and frequency of emergency room (emergency department) visits is associated with insurance status:

The rate of emergency room use is higher for Medicare and Medicaid beneficiaries than for the uninsured and individuals with private insurance.

A Medicaid enrollee is more likely than a privately insured or uninsured individual to visit the emergency room and also more likely to use it multiple times in a year, according to the National Center for Health Statistics.

Assuming that half of the 32 million to 34 million newly insured under the ACA gain private coverage and half will be enrolled in Medicaid, the NCPA estimates that they will generate 848,000 to 901,000 additional emergency room visits every year.

Medicare and Medicaid enrollees disproportionately use emergency services compared to the privately insured, perhaps because they have less access to primary care providers. In addition, elderly Medicare recipients and low-income Medicaid enrollees are less likely to have independent means of transportation, making ambulance use more likely.

How EMS Is Funded. Reimbursement from public and private insurers is a major source of revenue for fire and ambulance departments, but the primary source of funding is property taxes. Budget restraints, decreasing property values and restrictions on the use of municipal bonds to pay for equipment will make it difficult for many communities to increase their financial support.

The Centers for Medicare and Medicaid Services has created a national ambulance fee schedule in an attempt to standardize billing across the spectrum of insurance status. Over the past five years, many states have adopted it. However, since the national fee schedule does not cover the actual cost of the services provided, EMS services are subsidized by local taxpayers. A number of communities bill the uninsured for the EMS services they use, but it is difficult to collect. . . .

Medicare Payments for Ambulance Services. On average, EMS agencies lose money responding to calls from the publicly insured. For example:

The ACA will increase Medicare Part B reimbursements for urban-based transport by 3 percent, but only for one year (2011). 

Adjusted for the 3 percent increase, Medicare will reimburse providers $249.61 (plus an additional $6.87 per mile in urban locations) for basic transport in the state of Texas. 

Nationally, however, the cost of transporting an individual to the emergency room by ambulance ranged from $99 to $1,218 per trip and averaged $415, according to a 2007 Government Accountability Office report. 

Thus, EMS agencies are not reimbursed for the full cost of Medicare transport, and local taxpayers are stuck with the difference. . .  

Furthermore, ambulance providers are generally not compensated for care unless an individual is actually transported. Thus, even if the ambulance is only called as a precaution, or an individual's medical needs can be met at their location, there is a financial incentive to take an individual to a hospital in order to receive reimbursement.

A 2006 report by the Office of the Inspector General estimates that Medicare spent $3 billion for ambulance transports in 2002. More importantly, the Inspector General found that one-fourth of ambulance transportation for the publicly insured did not meet Medicare requirements, resulting in $402 million in improper payments. Researchers estimate that the rate of inappropriate ambulance use by the publicly insured ranges from 59 percent to 85 percent, compared to only 13 percent to 22 percent of privately insured individuals. . .

Inappropriate use in this context is defined as services provided by an emergency agency to an individual when there is a safe alternative to ambulance transportation. The Centers for Medicare and Medicaid say ambulance use is a medical necessity "where the use of other methods of transportation is contraindicated by the individual's condition."  

Increasing the number of individuals who qualify for public insurance will only exacerbate the problem. 

Conclusion. Scaling back emergency services would limit our national preparedness to respond to all incidents, but fragmented and inadequate financing risks municipal insolvency. Federal reimbursement rates do not cover EMS costs and the increased demand due to the ACA will put additional stress on the system. Possible solutions include dedicated taxes and changes in health insurance reimbursement policies that give patients incentives to control their consumption and cost, and reimburse EMS providers for medical treatment that does not require transport. 

Peter A. Swanson is a Hatton W. Sumners Scholar at the National Center for Policy Analysis, a National Registered Emergency Medical Technician and holds EMT certifications in Texas and New York state.

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 Government is not the solution to our problems, government is the problem.

- Ronald Reagan

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5.      Medical Gluttony: EMR—Medical Inefficiency

Have you ever tried to find a report in a 68 page Electronic Medical Record (EMR)?

Recently, a family doctor wanted a second opinion on a patient's lung cancer. She was allegedly cured for about four years until she developed a pleural effusion on the same side as her previous cancer. The fluid was drained and submitted for analysis. The patient felt the fluid was negative for cancer cells.

However, before we could render any meaningful report we had to confirm what the report of the pleural fluid, including cytology for cancer cells, stated.

We acquired the 68-paged EMR of the hospital admission for this complication and probable recurrence of her lung cancer. We spent a great deal of time reviewing those 68 pages and could not find a page that confirmed her feeling of the pleural fluid as being negative. The 68 pages of the EMR looked very much alike, with considerable duplication and the laboratory work repeatedly interspersed between doctors and other reports.

When reviewing a paper record, one is helped by the department's typical letterhead and the characteristics of those reports. However, on an EMR, each page is woefully similar to the previous and subsequent pages. Hence, one cannot fan through 68 nearly identical pages and nearly identical fonts to find anything quickly. When I couldn't find it, I had my assistant browse through those same pages. When she couldn't find it, we made some departmental phone calls and eventually succeeded in obtaining the desired report. Procuring the desired and required report took up essentially half of the allotted consultation time.

With a typical paper file, one would spend a few minutes going through the chart and when it is apparent there is no report from the department of pathology with their characteristic letterhead, a phone call would be made within the first minute or two and lean health care could then begin.

Before we are too harsh on the late Senator Kennedy, President George Bush, President Obama, and Newt Gingrich about their interpretation of EMR efficiency, we must remember that they are lay members intruding on a very specialized and sophisticated field about which they can have little depth of knowledge or understanding of the clinical method of diagnosis and treatment. Our diagnostic efficiency is diminished by their interference, which in turn decreases our standard of care.

There are very few EMRs today that are clinically useful and improve efficiency. The EPIC system, which is in use by Kaiser Permanente and several other large hospital and medical group combinations, approaches such an ideal. Although there are many small entries in this field, essentially all fall short of being useful and saving time across the entire spectrum of health care. As Dr. Clayton Christensen, of the Harvard Business School stated at the World Health Care Congress, the Electronic Medical Records will sit on the doctors' computer until such time as the doctors feel they are useful in the delivery of patient care.

Until such time that the EMR has evolved into standard use, it would be well if Presidents, Senators, and former House Members would refrain from telling doctors how to practice the art and science of medicine allowing progress to evolve normally and naturally.

Electronic Medical Records—A Perspective by Del Meyer . . .
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Medical Gluttony thrives in Government and Health Insurance Programs.

It Disappears with Appropriate Deductibles and Co-payments on Every Service.

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6.      Medical Myths: ObamaCare Reality Deficit

If you believe that a new entitlement saves money, you'll believe anything.

Of all the claims deployed in favor of ObamaCare, and there are many, the most preposterous is that a new open-ended entitlement will somehow reduce the budget deficit. Insure 32 million more people, and save money too! The even more remarkable spectacle is that Washington seems to be taking this claim seriously in advance of the House's repeal vote next week. Some things in politics you just can't make up.

Terminating trillions of dollars in future spending will "heap mountains of debt onto our children and grandchildren" and "do very serious violence to the national debt and deficit," Nancy Pelosi said at her farewell press conference as Speaker. Health and Human Services Secretary Kathleen Sebelius chimed in that "we can't afford repeal," as if ObamaCare's full 10-year cost of $2.6 trillion once all the spending kicks in is a taxpayer bargain.

The basis for such claims, to the extent a serious one exists, is the Congressional Budget Office's analysis this week of the repeal bill, which projects it will "cost" the government $230 billion through 2021. Because CBO figures ObamaCare will reduce the deficit by the same amount, repealing it will supposedly do the opposite. The White House promptly released a statement saying repeal would "explode the deficit." . . .

The accounting gimmicks are legion, but we'll pick out a few: It uses 10 years of taxes to fund six years of subsidies. Social Security and Medicare revenues are double-counted to the tune of $398 billion. A new program funding long-term care frontloads taxes but backloads spending, gradually going broke by design. The law pretends that Congress will spend less on Medicare than it really will, in particular through an automatic 25% cut to physician payments that Democrats have already voted not to allow for this year. . .

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Medical Myths originate when someone else pays the medical bills.

Myths disappear when Patients pay Appropriate Deductibles and Co-payments on Every Service.

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7.      Overheard in the Medical Staff Lounge: ObamaCare is affecting access to care, adversely

Dr. Edwards: Have you noticed any change in your practice?

Dr. Milton: It seems there are more Medicaid patients entering our practice under a private label.

Dr. Edwards: Yes, we're getting Medicaid patients repackaged at HealthNet/MC or Blue Cross/MC.

Dr. Rosen: We've always done our 10 percent welfare, but now they are traveling as private patients.

Dr. Edwards: Maybe that's the initial push of ObamaCare where he plans to push 30 Million people into Medicaid.

Dr. Rosen: That normally wouldn't disturb us but the practice has taken on a different perspective.

Dr. Paul: How so?

Dr. Rosen: We had never noticed the striking difference in our costs in caring for private patients as opposed to welfare patients.

Dr. Paul: Taking care of a patient shouldn't change just because he's poor, should it?

Dr. Rosen: We would normally have agreed with you, but as the volume increased, we have noted a distinct change in our office cost.

Dr. Paul: In our pediatric practice, we haven't seen any change.

Dr. Rosen: Over the past six months, we have come to realize that Medicaid patients put a lot more demands on our office than private patients. Private patients seem to understand the value of time, while Medicaid patients will call about anything.

Dr. Edwards: We've noticed the same. They will call to confirm their appointment because they can't find their appointment schedule. They come to the office unprepared. They want forms filled out and forget to bring in their forms. They just think bringing them back later is the same cost of time; they can't see it as doubling the cost of time and thus the expense.

Dr. Milton: They all have cell phones now and are unable to appreciate the difference between calling their friends for hours versus calling their doctors or pharmacists for trivial reasons. If they have attorneys, I bet they don't make frequent calls to them.

Dr. Paul: Why?

Dr. Milton: Attorneys charge the same rate for phone calls that they charge for office visits. Getting a $50 statement for a 12-minute phone call to an attorney changes behavior instantly.

Dr. Edwards: We could also change behavior instantly if we could charge for a phone call. Not at the usual physician rate, but even just $1 a call. The number of nuisance phone calls would drop to near zero overnight.

Dr. Rosen: Practice efficiency would also improve overnight.

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The Staff Lounge Is Where Unfiltered Opinions Are Heard.

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8.      Voices of Medicine: A Review of Physician Written Articles

Obama employs regulatory power plays by Charles Krauthammer, MD: Sacramento Bee, Dec. 31, 2010

Most people don't remember Obamacare's notorious Section 1233, mandating government payments for end-of-life counseling. It aroused so much anxiety as a possible first slippery step on the road to state-mandated late-life rationing that the Senate never included it in the final health care law.

Well, it's back – by administrative fiat. A month ago, Medicare issued a regulation providing for end-of-life counseling during annual "wellness" visits. It was all nicely buried amid the simultaneous release of hundreds of new Medicare rules.

Rep. Earl Blumenauer, D-Ore., author of Section 1233, was delighted. "Mr. Blumenauer's office celebrated 'a quiet victory,' but urged supporters not to crow about it," reports the New York Times. Deathly quiet. In early November, his office sent an e-mail plea to supporters: "We would ask that you not broadcast this accomplishment out to any of your lists … e-mails can too easily be forwarded." They had been lucky that "thus far, it seems that no press or blogs have discovered it. … The longer this (regulation) goes unnoticed, the better our chances of keeping it."

So much for Democratic transparency – and for their repeated claim that the more people learn what is in the health care law, the more they will like it. Turns out ignorance is the Democrats' best hope.

And regulation is their perfect vehicle – so much quieter than legislation. Consider two other regulatory usurpations in just the last few days:

On Dec. 23, the Interior Department issued Secretarial Order 3310 reversing a 2003 decision and giving itself the authority to designate public lands as "Wild Lands." A clever twofer: (1) a bureaucratic power grab – for seven years up through Dec. 22, wilderness designation had been the exclusive province of Congress, and (2) a leftward lurch – more land to be "protected" from such nefarious uses as domestic oil exploration in a country disastrously dependent on foreign sources.

The very same day, the president's Environmental Protection Agency declared that in 2011 it would begin drawing up anti-carbon regulations on oil refineries and power plants, another power grab effectively enacting what Congress had firmly rejected when presented as cap-and-trade legislation.

For an Obama bureaucrat, however, the will of Congress is a mere speed bump. Hence this regulatory trifecta, each one moving smartly left – and nicely clarifying what the spirit of bipartisan compromise that President Barack Obama heralded in his post-lame-duck Dec. 22 news conference was really about: a shift to the center for public consumption and political appearance only.

On that day, Obama finally embraced the tax-cut compromise he had initially excoriated, but only to avoid forfeiting its obvious political benefit – its appeal to independent voters who demand bipartisanship and are the key to Obama's re-election. But make no mistake: Obama's initial excoriation in his angry Dec. 7 news conference was the authentic Obama. He hated the deal.

Now as always, Obama's heart lies left. For those fooled into thinking otherwise by the new Obama of Dec. 22, his administration's defiantly liberal regulatory moves – on the environment, energy and health care – should disabuse even the most beguiled.

These regulatory power plays make political sense. Because Obama needs to appear to reclaim the center, he will stage his more ideological fights in yawn-inducing regulatory hearings rather than in the dramatic spotlight of congressional debate. How better to impose a liberal agenda on a center-right nation than regulatory stealth?

It's Obama's only way forward during the next two years. He will never get past the half-Republican 112th what he could not get past the overwhelmingly Democratic 111th. He doesn't have the votes and he surely doesn't want the publicity. Hence the quiet resurrection, as it were, of end-of-life counseling.

Obama knows he has only so many years to change the country. In his first two, he achieved much: the first stimulus, Obamacare and financial regulation. For the next two, however, the Republican House will prevent any repetition of that. Obama's agenda will therefore have to be advanced by the more subterranean means of rule-by-regulation. . .

Read the entire VOM in the Sacramento Bee . . .
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VOM Is an Insider's View of What Doctors are Thinking, Saying and Writing about

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9.      Book Review: "When Money Dies" by Adam Fergusson

A Flock of Black Swans, A review, By ANDREW STUTTAFORD, WSJ, Dec 30, 2010

It says something about present anxieties that a 35-year-old account of Weimar hyperinflation has come into vogue. In early 2010, Adam Fergusson's long-out-of-print volume was trading online for four-figure sums. There were (false) reports of kind words about it from Warren Buffett. Now back in print, this once obscure book from 1975 has been selling briskly. Just another manifestation of the financial millenarianism now sweeping the land? Perhaps, but "When Money Dies" remains a fascinating and disturbing book.

The death of the German mark (it took 20 of them to buy a British pound in 1914 but 310 billion in late 1923) plays a key part in the dark iconography of the 20th century: Images of kindling currency and economic chaos are an essential element in our understanding of the rise of Hitler. Mr. Fergusson adds valuable nuance to a familiar story. His tale begins not, as would be popularly assumed, in the aftermath of Germany's political and military collapse in 1918 (by which point the mark had halved against the pound) but in the original decision to fund the war effort largely through debt—a decision with uncomfortable contemporary parallels (one of many in this book) tailor-made for today's end-timers. . .

Read the entire book review on the WSJ, subscription required . . .

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10.  Hippocrates & His Kin: The Modern Challenges of being Hippocrates' Kin. (or Doctors)

More Middle Income Families Going without Health Insurance

It's not the poor and unemployed who go without health insurance, about a third of California's uninsured had family incomes of more than $50,000 in 2009 according to the California HealthCare Foundation, and the percentage of uninsured among families earning between $50K and $75K has nearly doubled in the past decade.

Is moving the uninsured from the poor to the middle class such a great achievement?

Sixty-five percent of working-age families got their health insurance from work-based coverage in 1987. Now 52 percent do.

That would suggest in another 25 years, less than a third would have health insurance from jobs.

Don't they know us hardworking Americans who have never worked a day in our lives are suffering too?

Rex Babin,

DA: Pa. had 'utter disregard' for abortion-seekers, Associated Press. Wednesday, Jan. 19, 2011

A doctor accused of running a filthy "abortion mill" for decades in an impoverished Philadelphia neighborhood delivered babies alive, killed them with scissors and allowed a woman who had survived 20 years in a refugee camp to be overmedicated and die at his clinic, prosecutors said.

Dr. Kermit Gosnell, 69, was charged Wednesday with eight counts of murder for the deaths of seven babies and one patient. Nine employees also were charged, including four with murder.

Prosecutors described the clinic as a "house of horrors" where Gosnell kept baby body parts on the shelves, allowed a 15-year-old high school student to perform intravenous anesthesia on patients and had his licensed cosmetologist wife do late-term abortions. A family practice physician, Gosnell has no certification in gynecology or obstetrics. . .

The "Women's Medical Society" opened in 1979 and was inspected by the state Department of Health only sporadically. The last inspection was in 1993. Philadelphia District Attorney Seth Williams accused state health officials of "utter disregard" for Gosnell's patients, who were mostly poor minority women like Mongar.

Gosnell made millions performing thousands of dangerous abortions. A second woman, a 22-year-old mother of two from Philadelphia, died in 2000 from a perforated uterus. . .

Mongar, a refugee with her husband Ash from native Bhutan, had gone to the clinic in November 2009. Gosnell wasn't at the clinic at the time. His staff administered the drugs repeatedly to the 4-foot-11, 110-pound Mongar as they waited for him to arrive. No one who answered the phone Wednesday at a listing for Ash Mongar in Virginia could comment.

"Those are the kind of stories that break your heart," said Vicki Saporta, president of the National Abortion Federation, which rejected Gosnell from membership years ago because he did not meet its standards of care. The group's 400 members perform about half the abortions in North America, she said.

"Unfortunately, some women don't know where to turn. You sometimes have substandard providers preying on low-income women who don't know that they do have other (safe) options," she said.

Authorities who raided Gosnell's clinic early last year in search of controlled drug violations instead stumbled upon a stench-filled clinic with bags and bottles of aborted fetuses scattered throughout the building.

"By day it was a prescription mill; by night it was an abortion mill," the grand jury report said. . .

Gosnell typically worked weeknights, arriving hours after his unskilled staff administered anesthesia and drugs to induce labor. He then "forced the live birth of viable babies in the sixth, seventh, eighth month of pregnancy and then killed those babies by cutting into the back of the neck with scissors and severing their spinal cord," Williams said. . .

The state's reluctance to investigate, under several administrations, may stem partly from the sensitivity of the abortion debate, Williams said. Nonetheless, he called Gosnell's case a clear case of murder.

"A doctor who with scissors cuts into the necks, severing the spinal cords of living, breathing babies who would survive with proper medical attention commits murder under the law," he said. "Regardless of one's feelings about abortion, whatever one's beliefs, that is the law." . . .

Under Pennsylvania law, abortions are illegal after 24 weeks of pregnancy, or just under six months, and most doctors won't perform them after 20 weeks because of the risks, prosecutors said.

In a typical late-term abortion, the fetus is dismembered in the uterus and then removed in pieces. That is more common than the procedure opponents call "partial-birth abortion," in which the fetus is partially extracted before being destroyed. . .

Online: Grand jury report:

How is murder defined? When the baby is out and you then kill it by cutting the neck? When a pregnant female is killed and it is a double murder? Not when a healthy baby is half way out and you proceed with a skull fracture and suck the brains out before the mouth is free so you can't hear a disturbing agonal cry?

A Princeton professor who says all killing from conception to one month of age should be legal and not be called murder?

A Valparaiso University Professor who says all prenatal killing should be illegal?

It appears that the cleanest and safest legal definition would be that all prenatal and postnatal killing should be illegal. That would also be the highest moral practice for our profession.

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Hippocrates and His Kin / Hippocrates Modern Colleagues
The Challenges of Yesteryear, Today & Tomorrow

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11.  Organizations Restoring Accountability in HealthCare, Government and Society:

                      The National Center for Policy Analysis, John C Goodman, PhD, President, who along with Gerald L. Musgrave, and Devon M. Herrick wrote Lives at Risk, issues a weekly Health Policy Digest, a health summary of the full NCPA daily report. You may log on at and register to receive one or more of these reports. This month, read the informative report from Dr. Goodman: Get prepared for doctors to spend less time with patients.

                      Pacific Research Institute, ( Sally C Pipes, President and CEO, John R Graham, Director of Health Care Studies, publish a monthly Health Policy Prescription newsletter, which is very timely to our current health care situation. You may signup to receive their newsletters via email by clicking on the email tab or directly access their health care blog. Just released John Graham on The End of the "Individual Mandate" Is Not the End of Obamacare.

                      The Mercatus Center at George Mason University ( is a strong advocate for accountability in government. Maurice McTigue, QSO, a Distinguished Visiting Scholar, a former member of Parliament and cabinet minister in New Zealand, is now director of the Mercatus Center's Government Accountability Project. Join the Mercatus Center for Excellence in Government. This month, treat yourself to: Consequences of regulating commercial advertising and marketing will hurt consumer welfare both directly and indirectly.

                      The National Association of Health Underwriters, The NAHU's Vision Statement: Every American will have access to private sector solutions for health, financial and retirement security and the services of insurance professionals. There are numerous important issues listed on the opening page. Be sure to scan their professional journal, Health Insurance Underwriters (HIU), for articles of importance in the Health Insurance MarketPlace. The HIU magazine, with Jim Hostetler as the executive editor, covers technology, legislation and product news - everything that affects how health insurance professionals do business.

                      The Galen Institute, Grace-Marie Turner President and Founder, has a weekly Health Policy Newsletter sent every Friday to which you may subscribe by logging on at A study of purchasers of Health Savings Accounts shows that the new health care financing arrangements are appealing to those who previously were shut out of the insurance market, to families, to older Americans, and to workers of all income levels. This month, you might focus on her article: Providing Coverage For All Through Private Health Insurance.

                      Greg Scandlen, an expert in Health Savings Accounts (HSAs), has embarked on a new mission: Consumers for Health Care Choices (CHCC). Read the initial series of his newsletter, Consumers Power Reports. Become a member of CHCC, The voice of the health care consumer. Be sure to read Prescription for change: Employers, insurers, providers, and the government have all taken their turn at trying to fix American Health Care. Now it's the Consumers turn. Greg has joined the Heartland Institute, where current newsletters can be found.

                      The Heartland Institute,, Joseph Bast, President, publishes the Health Care News and the Heartlander. You may sign up for their health care email newsletter. Read the late Conrad F Meier on What is Free-Market Health Care? This month, be sure to read the first Consumer Power Report concerning our new Congress.

                      The Foundation for Economic Education,, has been publishing The Freeman - Ideas On Liberty, Freedom's Magazine, for over 50 years, with Lawrence W Reed, President,  and Sheldon Richman as editor. Having bound copies of this running treatise on free-market economics for over 40 years, I still take pleasure in the relevant articles by Leonard Read and others who have devoted their lives to the cause of liberty. I have a patient who has read this journal since it was a mimeographed newsletter fifty years ago. Be sure to read the current lesson on Economic Education: The More Things Change . . .

                      The Council for Affordable Health Insurance,, founded by Greg Scandlen in 1991, where he served as CEO for five years, is an association of insurance companies, actuarial firms, legislative consultants, physicians and insurance agents. Their mission is to develop and promote free-market solutions to America's health-care challenges by enabling a robust and competitive health insurance market that will achieve and maintain access to affordable, high-quality health care for all Americans. "The belief that more medical care means better medical care is deeply entrenched . . . Our study suggests that perhaps a third of medical spending is now devoted to services that don't appear to improve health or the quality of care–and may even make things worse."

                      The Independence Institute,, is a free-market think-tank in Golden, Colorado, that has a Health Care Policy Center, with Linda Gorman as Director. Be sure to sign up for the monthly Health Care Policy Center Newsletter. Read the latest newsletter at De facto death panels: all four pieces in place.

                      Martin Masse, Director of Publications at the Montreal Economic Institute, is the publisher of the webzine: Le Quebecois Libre. Please log on at to review his free-market based articles, some of which will allow you to brush up on your French. You may also register to receive copies of their webzine on a regular basis. This month, read Bribery, Thy Name is Government: "To truly discourage bribery and corruption, we need to work around the state, removing it from the equation and allowing free people to thrive."

                      The Fraser Institute, an independent public policy organization, focuses on the role competitive markets play in providing for the economic and social well being of all Canadians. Canadians celebrated Tax Freedom Day on June 28, the date they stopped paying taxes and started working for themselves. Log on at for an overview of the extensive research articles that are available. You may want to go directly to their health research section.

                      The Heritage Foundation,, founded in 1973, is a research and educational institute whose mission was to formulate and promote public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values and a strong national defense. -- However, since they supported the socialistic health plan instituted by Mitt Romney in Massachusetts, which is replaying the Medicare excessive increases in its first two years, and was used by some as a justification for the Obama plan, they have lost sight of their mission and we will no longer feature them as a freedom loving institution and have canceled our contributions. We would also caution that should Mitt Romney ever run for National office again, he would be dangerous in the cause of freedom in health care. The WSJ paints him as being to the left of Barrack Hussein Obama. We would also advise Steve Forbes to disassociate himself from this institution.

                      The Ludwig von Mises Institute, Lew Rockwell, President, is a rich source of free-market materials, probably the best daily course in economics we've seen. If you read these essays on a daily basis, it would probably be equivalent to taking Economics 11 and 51 in college. Please log on at to obtain the foundation's daily reports. You may also log on to Lew's premier free-market site to read some of his lectures to medical groups. Learn how state medicine subsidizes illness or to find out why anyone would want to be an MD today.

                      CATO. The Cato Institute ( was founded in 1977, by Edward H. Crane, with Charles Koch of Koch Industries. It is a nonprofit public policy research foundation headquartered in Washington, D.C. The Institute is named for Cato's Letters, a series of pamphlets that helped lay the philosophical foundation for the American Revolution. The Mission: The Cato Institute seeks to broaden the parameters of public policy debate to allow consideration of the traditional American principles of limited government, individual liberty, free markets and peace. Ed Crane reminds us that the framers of the Constitution designed to protect our liberty through a system of federalism and divided powers so that most of the governance would be at the state level where abuse of power would be limited by the citizens' ability to choose among 13 (and now 50) different systems of state government. Thus, we could all seek our favorite moral turpitude and live in our comfort zone recognizing our differences and still be proud of our unity as Americans. Michael F. Cannon is the Cato Institute's Director of Health Policy Studies. Read his bio, articles and books at

                      The Ethan Allen Institute,, is one of some 41 similar but independent state organizations associated with the State Policy Network (SPN). The mission is to put into practice the fundamentals of a free society: individual liberty, private property, competitive free enterprise, limited and frugal government, strong local communities, personal responsibility, and expanded opportunity for human endeavor.

                      The Free State Project, with a goal of Liberty in Our Lifetime,, is an agreement among 20,000 pro-liberty activists to move to New Hampshire, where they will exert the fullest practical effort toward the creation of a society in which the maximum role of government is the protection of life, liberty, and property. The success of the Project would likely entail reductions in taxation and regulation, reforms at all levels of government to expand individual rights and free markets, and a restoration of constitutional federalism, demonstrating the benefits of liberty to the rest of the nation and the world. [It is indeed a tragedy that the burden of government in the U.S., a freedom society for its first 150 years, is so great that people want to escape to a state solely for the purpose of reducing that oppression. We hope this gives each of us an impetus to restore freedom from government intrusion in our own state.]

                      The St. Croix Review, a bimonthly journal of ideas, recognizes that the world is very dangerous. Conservatives are staunch defenders of the homeland. But as Russell Kirk believed, wartime allows the federal government to grow at a frightful pace. We expect government to win the wars we engage, and we expect that our borders be guarded. But St. Croix feels the impulses of the Administration and Congress are often misguided. The politicians of both parties in Washington overreach so that we see with disgust the explosion of earmarks and perpetually increasing spending on programs that have nothing to do with winning the war. There is too much power given to Washington. Even in wartime, we have to push for limited government - while giving the government the necessary tools to win the war. To read a variety of articles in this arena, please go to

                      Hillsdale College, the premier small liberal arts college in southern Michigan with about 1,200 students, was founded in 1844 with the mission of "educating for liberty." It is proud of its principled refusal to accept any federal funds, even in the form of student grants and loans, and of its historic policy of non-discrimination and equal opportunity. The price of freedom is never cheap. While schools throughout the nation are bowing to an unconstitutional federal mandate that schools must adopt a Constitution Day curriculum each September 17th or lose federal funds, Hillsdale students take a semester-long course on the Constitution restoring civics education and developing a civics textbook, a Constitution Reader. You may log on at to register for the annual weeklong von Mises Seminars, held every February, or their famous Shavano Institute. Congratulations to Hillsdale for its national rankings in the USNews College rankings. Changes in the Carnegie classifications, along with Hillsdale's continuing rise to national prominence, prompted the Foundation to move the College from the regional to the national liberal arts college classification. Please log on and register to receive Imprimis, their national speech digest that reaches more than one million readers each month. This month, read Sung-Yoon Lee on Keeping the Peace: America in Korea, 1950-2010 at The last ten years of Imprimis are archived.

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Words of Wisdom

Reagan saw America as "a living, breathing presence, unimpressed by what others say is impossible, proud of its own success; generous, yes, and naïve; sometimes wrong, never mean, always impatient to provide a better life for its people in a framework of a basic fairness and freedom."

Obama at the Tucson tragedy: "At a time when our discourse has become so sharply polarized," we are too eager to lay the blame "at the feet of those who happen to think differently than we do." It is important that we talk to each other "in a way that heals, not in a way that wounds." Scripture tells us "that there is evil in the world." We don't know what triggered the attack, but "what we cannot do is use this tragedy as one more occasion to turn on each other."

Declarations – by Peggy Noonan

He sounded like the president, not a denizen of the faculty lounge.

Some Recent Postings

October HPUSA Newsletter:

1.     Featured Article: The Forgotten Man of Socialized Medicine

2.     In the News: Discontinuing Failed Drug Research is Expensive

3.     International Healthcare: The Stockholm Network

4.     Government Healthcare: A Growth Agenda for the New Congress

5.     Lean HealthCare: Healthcare is going ‘lean'

6.     Misdirection in Healthcare: What Motivated ObamaCare?

7.     Overheard on Capital Hill: Benign Dictatorship and the Progressive Mind.

8.     Innovations in Healthcare: Health Plan from the National Center for Policy Analysis  

9.     The Health Plan for the USA: How technology reduces health care costs

10.   Restoring Accountability in Medical Practice by Moving from a Vertical to a Horizontal Industry:

Subscribe to the HPUSA Newsletter:

December MedicalTuesday Newsletter:

1.       Featured Article: A Hundred Billion Neurons – a Cosmic Headache

2.       In the News: Placebos really work

3.       International Medicine: It's time government called "time out" on the Canada Health Act

4.       Medicare: When the Doctor Has a Boss

5.       Medical Gluttony: Best Practices or Pay for Performance is really Gluttony in Disguise

6.       Medical Myths: Slow Metabolism makes me gain weight

7.       Overheard in the Medical Staff Lounge: When the Doctor Has a Boss

8.       Voices of Medicine: A Homeless Man's Funeral . . .  

9.       The Bookshelf: The Power To Control, A Review By JEREMY PHILIPS

10.     Hippocrates & His Kin: The Highest Pay Increases in Sacramento went to Hospital CEOs.

11.     Related Organizations: Restoring Accountability in Medical Practice and Society

Words of Wisdom, Recent Postings, In Memoriam . . .

Subscribe to MedicalTuesday Newsletter:

In Memoriam

Carlos Andrés Pérez, president of Venezuela in both boom and bust, died on December 25th, aged 88

The ECONOMIST | Jan 6th 2011 | from PRINT EDITION

EVER since 1922, when the first gusher at Maracaibo roared up with the noise of "a thousand freight trains", the history and destiny of Venezuela has been tied fast to oil. "Black gold" has brought highways, schools, shipyards, hydroelectric plants and the skyscrapers of Caracas. It has also brought economic collapse, political repression and thoroughgoing corruption. Not for nothing is it also known in Venezuela as the excrement of the devil.

Carlos Andrés Pérez, born the very year the gusher erupted, knew all about both sides of oil. He led Venezuela through both the boom years of 1974-79, when prices had quadrupled after the Arab oil embargo, and, in a second term, through the bust of 1989-93, when they had dived so steeply that Venezuela ended up borrowing $4.5 billion from the IMF. In the late 1970s his long-time mistress, Cecilia Matos, would appear in a necklace from which hung a small, gold, oil derrick. The necklace fell out of favour, though she did not; wife and mistress still battled over Mr Pérez as he lay in his coffin, elegant as ever in suit and white silk tie.

Flash, energetic, full of sound political instincts but economically challenged, Mr Pérez rode the oil boom like an old-fashioned populist caudillo. His proudest stroke was to nationalise the oil industry in 1976, buying up the foreign companies for $1 billion and signing the papers with a showy gold pen. Huge public works were started, at a cost of $53 billion: housing projects, industrial parks, a subway in Caracas and El Sistema, a music-teaching programme for the poor. Venezuela Saudita (Saudi Venezuela) seemed to be doing so well that in 1989, even with oil prices dipping, Mr Pérez invited 27 heads of state and 800 foreign dignitaries to dine on lobster and bubbly at his second inauguration.

Some policies were sensible. The newly nationalised oil industry kept the structure of the old, and production was limited to try to moderate the flood of money into a country ill-equipped to handle it. An investment fund was set up, too. But Mr Pérez never thought to pay off Venezuela's external debt, which rose from $0.7 billion in 1974 to $6.1 billion in 1978, or to stem the flight of $35 billion in capital out of the country. A man of ambitions as big as his sideburns, Mr Peréz seemed to think the oil price would never go down.

By 1989, the year he went begging to the IMF, this fervent socialist—a man whose first instincts in government in 1974 had been to freeze the price of arepas (Venezuelan tortillas) and to insist on an operator in every lift in Caracas—had become a reluctant Thatcherite. He raised interest rates, removed customs dues and liberated petrol prices, which promptly doubled. The result was rioting in and around Caracas in which some 400 people died, mostly shot by the national guard.

Mr Pérez's moral authority never recovered. He made a poor salesman for his austerity programme; though it did Venezuela good in the end, the gap between rich and poor yawned as wide as ever, and many also assumed that the president was stealing. In 1993 Congress impeached him for diverting $17m of public money to a secret fund; he said it had gone to help Violeta Chamorro win the presidency of Nicaragua, but the Supreme Court nonetheless removed him from office and put him under house arrest.

From coffee to petroleum

He was noisy even then. Politics was always his life and soul. It represented his ticket out of Rubio, in the Andes, to a life of glamour, fame and ever-attentive women. But Rubio, a coffee town, also shaped his deepest political instincts. His father owned a small finca there and, when the world coffee price collapsed in the 1930s, he died of stress and despair. Young Carlos realised then the reality of Venezuelan life: because his country was underdeveloped, it could neither control the price of its resources nor run its own affairs.

A half-hearted try at lawyering therefore didn't work; he was too busy reading leftish books. As a teenager he joined the National Democratic Party, then the socialist Acción Democrática, then in 1945 became private secretary to Rómulo Betancourt, AD's founder, which got him into national politics in risky opposition to a series of military rulers. For ten years he was exiled, but came back strongly, and campaigned village-to-village for the presidency like an American congressman.

Once ensconced in the Miraflores palace, he determined to make his country speak for the commodity-rich but less developed world. As a member of OPEC (as he declared in an open letter to America's president, in 1974 in the New York Times), Venezuela intended to counteract the "economic oppression" of the industrialised countries, and the "outrageously low" prices they paid. He saw himself as a voice for the South against the North, as a pillar of the Non-Aligned Movement and a supporter of any country, such as Cuba, that got up the nose of the first world.

In that sense he paved the way for Hugo Chávez, the current president, who had tried to remove him in a coup in 1992, and whom he hoped would "die like a dog" before too long. Like Mr Chávez, he believed that oil gave Venezuela a passport to greatness and a mandate to annoy. He did not believe it allowed him to play quite so fast and loose with democracy.

Read the entire obituary from The Economist . . . 

On This Date in History - January 11

On this date in 49 BC, Caesar crossed the Rubicon. The great decision in a person's life is sometimes described as "crossing the Rubicon." The phrase comes from Julius Caesar's crossing of the river Rubicon on this day in 49 BC, whereby Caesar committed himself irrevocable to war against Pompey and the Roman Senate. "The die is cast," Caesar said. Most of us have a personal Rubicon that, sooner or later, we have to cross. For whole nations as well—is this such a time?

On this date in 1935, Amelia Earhart Putnam set out to do what no woman had ever done before—to fly herself across the Pacific. She left on this date from Honolulu arriving in California the next day, January 12, proving again the motto that is the watchword of human progress, it can be done! Beasts behave on instinct, but humans choose their own paths. Earhart was the first woman to receive the U.S. Distinguished Flying Cross,[3] awarded for becoming the first aviatrix to fly solo across the Atlantic Ocean.[4] She set many other records,[2] wrote best-selling books about her flying experiences and was instrumental in the formation of The Ninety-Nines, an organization for female pilots.[5] Earhart joined the faculty of the world-famous Purdue University aviation department in 1935 as a visiting faculty member to counsel women on careers and help inspire others with her love for aviation. She was also a member of the National Woman's Party, and an early supporter of the Equal Rights Amendment. During an attempt to make a circumnavigational flight of the globe in 1937 in a Purdue-funded Lockheed Model 10 Electra, Earhart disappeared over the central Pacific Ocean near Howland Island and declare missing July 2, 1937; declared legally dead January 5, 1939. Fascination with her life, career and disappearance continues to this day. - cite_note-7#cite_note-7


On this date in 1755, Alexander Hamilton was born in the British West Indies. His name is one of the great ones in American history; an economist; a political philosopher; Aide-de-camp to General George Washington during the American Revolutionary War; leader of American nationalists calling for a new Constitution; one of America's first constitutional lawyers, who wrote most of the Federalist Papers, a primary source for Constitutional interpretation; the first US Secretary of the Treasury; a Founding Father whose face is one of the most familiar, since it appears on the Ten dollar bill; his fate also familiar, since he was probably America's most famous victim of a dual, killed in just such an "affair of honor" by Aaron Burr.

After Leonard and Thelma Spinrad

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Always remember that Chancellor Otto von Bismarck, the father of socialized medicine in Germany, recognized in 1861 that a government gained loyalty by making its citizens dependent on the state by social insurance. Thus socialized medicine, or any single payer initiative, was born for the benefit of the state and of a contemptuous disregard for people's welfare.