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The biggest cliff

CliffIt's ironic that, with all the talk about fiscal cliffs, little attention is being paid to the ultimate cliff we all must face.  

Government budgets and our own end-of-life discussions are more closely related than many people are willing to acknowledge.

I'm sure there's a flaw in my thinking on this. And I'd be grateful if someone would point it out to me. So here goes:

Healthcare costs are the biggest budget driver.

  • Healthcare costs are the biggest and fastest-growing part of the federal budget. Medicare, Medicaid, and CHIP account for 21% of the federal budget. And that doesn't count healthcare spending in other parts of the budget -- e.g., for the military and government employees.
  • Federal spending on healthcare is projected to double in the next decade as the aging population joins Medicare and as the Affordable Care Act extends Medicaid and insurance subsidies to more people.  
  • Overall medical costs are growing faster than the underlying economy and at a higher rate than overall inflation.

Insurance (including Medicare, Medicaid, etc.)

  • Health insurance in itself does little to lower healthcare costs, though it's the one element most people see and therefore pay attention to. 
  • Insurance companies have relatively little purchasing power because the nation's health system is so decentralized. 
  • Legislation inhibits the purchasing power of the government in some areas, e.g., negotiating drug prices. 
  • On the other hand, the government tool most often threatened -- unilaterally lowering doctor payments -- will not lower costs, because doctors will opt out of the system, lowering the availability of care and forcing patients into hospital emergency rooms, which are the most expensive  
  • Lowering the cost of health insurance will do little to lower the cost of healthcare itself. In fact, cheaper insurance could increase the consumption of healthcare services, which is the primary driver of rising costs.
Consumption
  • Americans spend more per capita for healhtcare than any other nation. The principal reason for this is that we consume more healthcare services, not because our healthcare system itself is inherently more expensive. 
  • The biggest and fastest-growing segment of total healthcare spending is end-of-life care. According to a government study, 70% of healthcare spending is on the elderly and 80% of that is during the last month of life.
  • So it seems a no-brainer that that's where we should concentrate our attention.

Rationing

  • The only way to lower healthcare costs is to make tough-minded cost/benefit choices.
  • This doesn't require "death panels." But it does require better research into what treatments are effective and therefore worth pursuing. And it could mean basing insurance payments on those findings.
  • And that will require the ambidextrous exercise of the thorniest of all disciplines -- ethics and politics. 

Finally, I say all this even though I am fast approaching the point when I myself will need end-of-life care. And with full knowledge that my own kids -- who may be making these decisions on my behalf -- occasionally read these musings.



Little bigots

BabyTonight, "60 Minutes" explored the minds of babies as young as three months old.

In a series of ingenious experiments at Yale's "Baby Lab," researchers have uncovered instinctual behavior that ranges from the admirable (a basic sense of fairness) to the deplorable (prejudice).  You can see the segment here.  

What was especially interesting from the perspective of OtherWise, is compelling evidence that being wary of people who are different seems to be hardwired into us. Even babies categorize people into camps of "us" and "them." And they do it based on the most arbitrary characteristics.  (For example, whether someone likes the same treats we like.)  

Not only are we predisposed to break the world up into groups, we also like people who are different to be punished for their differences.

The good news is that these nasty tendencies can be tempered by society and education. And, in fact, the researchers have demonstrated that many of these biases lessen or even disappear by the time most kids are 8 or 8.

The bad news is that we often regress to our natural self when we're under pressure.

 


 


And the winner is...

RomneyI don't like to think of myself as someone who piles on when someone is down.

So I resisted the urge to give Mitt Romney the first annual OtherDumb Award. And to be honest, there were a number of other worthy candidates.

But now the Mittster's cluelessness has reached hitherto unplumbed levels. He really seems to be trying to win the award.

Apparently, Romney thinks he lost the presidential election because President Obama convinced all those Blacks, Hispanics, and young people to vote for him by giving them free condoms, health insurance, loan forgiveness, and the promise of green cards. Or at least that's what he told his major donors recently. 

I'm sorry. No one is likely to demonstrate a greater level of sheer out-of-touchness in the few weeks left in the year. Except perhaps Mr. Romney himself.

So the 2012 OtherDumb prize (to be known hereafter as the "Mitt") goes to Mitt Romney. 

Someone please tell him to dial back on the gratuitous cluelessness. He won't be eligible for another award for a year.

 


Petitions

Petition 2Taking its cue from the First Amendment to the Constitution, which grants citizens the right to petition the govenment, the Obama administration began a noble experiment about a year ago.

It added a section to the White House web site giving people the online ability to create or sign a petition urging the president to take action on a particular issue.

In just a year, the site generated 3.4 million signatures by 2.8 million users.

The petitions address issues ranging from the serious, such as stopping the use of monkeys in Army chemical warfare training (done) or giving green cards to foreign graduates with advanced degrees (the president would love to, stay tuned).

Of course, this being America, there are also a number petitions trying to reopen old battles, like repealing Obamacare (no response).

And there are plenty of petitions to address less earth-shaking issues, such as releasing the recipe for the beer brewed in the White House (done) or banning Rush Limbaugh from Armed Force's Radio (not going to do it).

The original plan was to respond to any petition that received 150 signatures in 30 days, but that soon proved impractical. So now the threshhold is 25,000 signatures in 30 days. But the White House reserves the right to change the threshhold at any time.

That may be a good idea, because since the election, more than 60 petitions have been posted requesting that states be allowed to withdraw from the United States and create their own government. 

Not surprisingly, the hot bed of secession appears to be in places like Texas (108,000 signatures) and Louisiana (35,000). But no state is immune. My own state of New Jersey is apparently home to more than 18,000 people who would like to secede from the union (1,000 more than Mississippi).  

Sociologists at the University of North Carolina estimate that only about 250,000 people account for the 750,000 odd signatures on these various petitions. But it seems that the signatures really do come from across the country. They developed an interactive map that presents the information at the county level.

 In New Jersey, there were even 308 secessionists in storm devestated Ocean County. I have to believe they live on the high floor of a gated community with its own power generators far from the sea.

Of course, this being America, there's also a petition calling for the deportation of everyone who signed a petition calling for their state to secede from the United States (20,812 signatures).

 

 



Ratings whores

SchiefferWant to know why Congress is so disfunctional and the public is so divided?

Look at the news entertainment media.

Fox TV doesn't have a corner on fulmninations and name calling designed to bolster ratings.

Even the venerable Sunday morning news panels have become forums for "making news" at the expense of exploring the important issues of the day.

Case in point: the current controversy over comments UN Ambassador Susan Rice made about the attacks in Benghazi, Libya.

Starting at the end and working back, it's pretty obvious that she is the victim of yellow journalism worthy of the Hearst tabloids in the days of the Spanish-American War.

In a story about Ms. Rice's possible nomination as Secretary of State, the New York Times notes that she "would face stiff resistance on Capitol Hill, where she has come under withering criticism from Republicans for asserting that the deadly attack on the American mission in Benghazi, Libya, might have been a spontaneous protest rather than a terrorist attack."

That's absolutely correct -- many GOP lawmakers have accused Ms. Rice of claiming that the Benghazi attack might have been a spontaneous protest. They consider it part of an Administration plot to avoid admitting that terrorists are still at large, despite the killing of Osama bin Laden.

Leaving aside the fact that no one in the Obama administration has claimed the terrorist threat is over, there's only one thing wrong with that assertion: Ms. Rice did not say the attack was a spontaneous protest and she didn't deny it was a terrorist attack.

Here's what she told Bob Schieffer of CBS's "Face the Nation" program:  

"Based on the best information we have to date, what our assessment is as of the present is in fact what began spontaneously in Benghazi as a reaction to what had transpired some hours earlier in Cairo where, of course, as you know, there was a violent protest outside of our embassy-- --sparked by this hateful video. But soon after that spontaneous protest began outside of our consulate in Benghazi, we believe that it looks like extremist elements, individuals, joined in that-- in that effort with heavy weapons of the sort that are, unfortunately, readily now available in Libya post-revolution. And that it spun from there into something much, much more violent."

It's not elegantly phrased -- as Gov. Romney might say -- but it's pretty clear she said it appeared that a spontaneous protest was taken over by extremists.

Scheiffer asked if the attack had been planned and whether Al Queda had participated and, rather than denying either claim, she said, "Well, we'll have to find out that out. I mean I think it's clear that there were extremist elements that joined in and escalated the violence. Whether they were al Qaeda affiliates, whether they were Libyan-based extremists or al Qaeda itself I think is one of the things we'll have to determine."

You can read the transcript for yourself here.

If you do read it, pay close attention to the question, Schieffer then poses to Senator John McCain in a separate interview.

"Susan Rice says that the State Department thinks it is some sort of a spontaneous event," he said with a note of skepticism. "What-- what do you make of it?" Well, McCain naturally thought that was preposterous.

"Most people don't bring rocket-propelled grenades and heavy weapons to a demonstration," he said. "That was an act of terror, and for anyone to disagree with that fundamental fact I think is really ignoring the facts."

Right.

Except this is one of those imaginary controversies that exists only in the minds of news entertainment jockeys who want to generate secondary headlines.

It pains me to count Bob Schieffer -- a man I have long admired -- among the ratings whores. He is one of the senior journalists who despair that our political system has become so dysfunctional. Look in the mirror, Bob.

 

 

 


President of the 1950s

Woman-Voting-1950s-200xThe single demographic group that mattered most in this election was women.  

As they have since 1980, women voted in greater numbers than men (53% of votes cast compared to 47% by men).

And they overwhelmingly supported President Obama (55% to 43%).

Of course, no one is defined solely by their gender and, in fact, Governor Romney got 56% of the white women's vote, compared to Obama's 42%. Romney was also favored by married women, 53% to 46%.

But Obama more than made up the difference among women of color, who gave him more than 8 out of ten of their votes. And single women were twice as likely to vote for Obama as for Romney, 67% to 31%.

In sum, on the basis of gender, Romney won the electorate of the 1950s; Obama, that of the 21st century.

Marketers and communications professionals should take note.

Women don't vote only in semi-annual public elections. They vote every day at the cash register and online. Make sure you're talking to today's woman and not her mother or grandmother. 


 


The Biggest Losers

Biggest_losers_rect-460x307 (1)Peggy Noonan, Karl Rove, the Koch Brothers, the folks at Fox & Friends ... there were plenty of losers in this presidential election besides Governor Romney.

Count Big Business among them. 

No, not because the business community put the bulk of its money on the losing horse. And not because an “anti-business” Obama administration will raise corporate taxes. 

But because the losing argument in this election tied the economic well-being of the Middle Class to the health of the business sector.

At the beginning of the presidential campaign, all the pundits were singing a common theme song: “It’s the economy, stupid.” Voters, we were told, always punish or reward the incumbent according to the economic vapors. When the economy is sweet, whoever’s in the Oval Office gets a pass; if it’s sour, he’s freed to concentrate on planning his new library. 

On that score, none of the traditional metrics supported President Obama’s re-election, whether it was the unemployment rate, consumer confidence, or the proportion of voters who thought the country was going in the right direction. Even his job approval seldom wandered  over 50%.

The two candidates’ political philosophies reflected their respective backgrounds – the community organizer who saw government as a lever for change and the businessman who considered it a drag on the economy.

Somewhere along the line, the election became a referendum on those two worldviews.

 As it turns out, most voters didn't buy the Romney camp’s argunent that the secret to growing the Middle Class is to improve the business climate for “job creators” by cutting corporate taxes and reducing regulation.that debate

For example, as David Brooks pointed out in a recent column, surveys show that Asian- and Hispanic-Americans value industriousness and entrepreneurship even more than whites, but they also think government plays an important role in enhancing opportunity and improving the business climate. They don’t see government and business as Hatfields and McCoys.

And when the question was put directly to voters in one national survey, nearly two in three said building a strong middle class was more important to economic recovery than creating a “healthy climate for business.”  They didn’t see the link.

Americans believe in private enterprise, but they no longer believe corporate success has much to do with their own security — only 18% strongly agree that “the middle class always does well when big corporations do well.”

Voters in Michigan and Ohio apparently rewarded President Obama – and arguably punished Governor Romney – for rescuing the auto industry. But that may be the exception that proves the rule. When employees see a direct connection between their well-being and their employer’s, they respond accordingly. And when they see a disconnect between rewards at the top of the company and further down in the ranks, they do the same.  

Since 2000, the middle class has shrunk in size, fallen backward in income and wealth, and lost much of its faith in the future. For more than a decade, a majority of Americans have told pollsters they don’t expect today’s kids to be better off than their parents. They can’t fix it, so it’s only natural for them to fix blame. About half point the finger at large corporations.

There’s a strong message here for American business leaders. So strong, it amounts to a warning. Any company that doesn’t factor those attitudes into its business risk assessments is asking for trouble.

 


Poll diving

Paperstack4There's lots to learn from the recent election, both in the way the campaigns were run as well as from all the polling data.

In this post, I do a little poll diving.

The best presentation of the presidential exit polls I've seen is over at Fox News

I'll be digging through the results for the next few days, looking for insights that might have application in public relations and marketing. Here's one consideration that companies should ponder: 

The pollsters asked people who had just voted, "Which one of these four candidate qualities mattered most in deciding how you voted for president?"

                                                   Total      Obama        Romney

    Shares my values                       27%          42%            55%

    Is a strong leader                       18%          38%            61%

    Has a vision for the future          29%          45%            54%

    Cares about people like me         21%          81%            18%

Governor Romney did better than President Obama on the first three, but Obama blew him away (81 percent to 18 percent) on the fourth, which was regarded as most important by 21 percent of the respondents. In fact, Obama's margin on that single characteristic trumped Romney’s combined margins on the other three qualities.

Similarly, on the question of "who is more in touch with people like you?" Obama has a ten point lead over Romney (53% to 43%).

On the critical issue of who would best handle the economy, Obama and Romney were essentially tied (48% and 49% respectively). 

The touch-feely question of who cared more appeared to be the tie-breaker.

Big Business, which may have been one of the big losers in this election for reasons I'll get into in future postings, should pay heed.


  


Locked minds

Locked_mindHere's further proof that most of us may be free to express our opinions, but we hold our beliefs under lock and key.

When the Labor Department reported a one percentage point decline  in unemployment a few weeks ago, University of Massachusetts researchers already had a survey in the field. So they drew a line in their tabulations between the periods before and after the report.

Here's what they found:

  • After the report was issued, Liberals and Moderates were much more likely to say unemployment had decreased over the last year (and the converse, less likely to say unemployment had increased).
  • Initially, Conservatives were also more likely to say unemployment had decreased (and the converse).
  • But over time, Conservative responses returned to where they had been prior to the announcement.

The charts below illustrate the pattern.

2012-11-01-jobsreport2

As many political scientists have discovered, inconvenient information is often forgotten or rationalized away so we can continue to believe what we always believed.

Of course, conservatives don't have a corner on this particular human tendency. Liberals can be just as selective in what they forget or ignore.