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	<title>Rethinking the Economy &#187; Health care</title>
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	<link>http://rethinkecon.org</link>
	<description>Stumbling towards a new model for creating growth, opportunity, and justice</description>
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		<title>Power Isn&#8217;t a Stain on the Economy&#8217;s Fabric, It&#8217;s Part of the Economy&#8217;s Fabric</title>
		<link>http://rethinkecon.org/2010/06/28/power-isnt-a-stain-in-the-economys-fabric-its-part-of-the-economys-fabric/</link>
		<comments>http://rethinkecon.org/2010/06/28/power-isnt-a-stain-in-the-economys-fabric-its-part-of-the-economys-fabric/#comments</comments>
		<pubDate>Mon, 28 Jun 2010 07:12:52 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Checks and Balances]]></category>
		<category><![CDATA[Government]]></category>
		<category><![CDATA[Health care]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=2522</guid>
		<description><![CDATA[It&#8217;s time, says  Robert Reich, to drop a Top Hat on the corruption spewed by the market:
In the words of lobbyist Lauren Maddox, &#8220;The policy process is an extension of the market battlefield.&#8221; 
The answer is not necessarily found in broader or stricter &#8220;ethics rules&#8221; barring specific gifts to politicians. Such rules may have [...]]]></description>
			<content:encoded><![CDATA[<p>It&#8217;s time, says  <a href="http://www.prospect.org/cs/articles?article=everyday_corruption">Robert Reich</a>, to drop a Top Hat on the corruption spewed by the market:<br />
<blockquote>In the words of lobbyist Lauren Maddox, &#8220;The policy process is an extension of the market battlefield.&#8221; </p>
<p>The answer is not necessarily found in broader or stricter &#8220;ethics rules&#8221; barring specific gifts to politicians. Such rules may have little effect and will not, on their own, restore public trust. Instead, we need to consider how to prevent high-stakes market competition from intruding on political decision-making, to create what might be considered &#8220;safe zones&#8221; where the market has no influence. </p></blockquote>
<p> I don&#8217;t have a problem with the changes Reich wants to make &#8212; public financing, slowing down the revolving door between public service jobs and corporate jobs, etc. But wishing for &#8220;safe zones&#8221; makes about as much sense as wishing for unicorns (or safe zones patrolled by unicorns).</p>
<p>Take the last healthcare fight. Reich writes:<br />
<blockquote>Doctors squabbled over whether primary-care physicians would get a Medicaid payment boost or a somewhat smaller boost would go to all doctors. Insurers that specialize in higher &#8212; cost plans mainly going to unionized companies squared off against those specializing in plans that cater to lower-wage workers on whether taxes should be raised on high-cost plans and at what level the tax would kick in. Middle &#8212; sized companies fought against small employers over the size of businesses that will be exempt from the requirement of insuring their employees. And on and on.</p>
<p>Many of these battles continue but have moved into the regulatory process, where different companies, sectors, and industries are seeking rules that advantage them and disadvantage their competitors.</p></blockquote>
<p> As opposed to when? The only reason we had any chance of a real debate this time is that the Godzilla of the medical world, the AMA, had its monopoly of power broken by the insurance companies a few decades ago. Case in point: from the  <a href="http://www.psychologytoday.com/blog/adventures-in-old-age/200908/medicare-is-socialism">New York Times</a> in 1965.<br />
<blockquote>The American Medical Association said today that it was placing an advertisement in 100 newspapers to make its position clear on its opposition to health care reform. The advertisement calls health care reform &#8216;the beginning of socialized medicine.&#8217; </p></blockquote>
<p> What was the AMA trying to nuke? Medicare.</p>
<p>Healthcare is a particularly good case because even if, for example, somehow you magically created a public debate &#8220;safe zone,&#8221; Big Pharma would still have plenty of indirect influence over it. Remember this charming story from the  <a href="/2009/08/31/healthcare-the-hazards-of-the-moral-hazard-argument/">New York Times</a> last year?</p>
<blockquote><p>A growing body of evidence suggests that doctors at some of the nation’s top medical schools have been attaching their names and lending their reputations to scientific papers that were drafted by ghostwriters working for drug companies — articles that were carefully calibrated to help the manufacturers sell more products.</p></blockquote>
<p> I&#8217;m not arguing we couldn&#8217;t rein in some of the insanity. But it&#8217;s ridiculous to that we can treat market power like it&#8217;s a stain on public discourse.</p>
<p>In fact, I think this denial makes the problem worse. By pretending that power isn&#8217;t an inextricable part of the economy, we undermine building support for the real solution &#8212; insuring everyone has a real say by creating  <a href="/2009/05/04/principle-4-use-checks-and-balances/">Checks and Balances </a>.</p>
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		<title>Green Signs of Hope</title>
		<link>http://rethinkecon.org/2010/04/12/green-signs-of-hope/</link>
		<comments>http://rethinkecon.org/2010/04/12/green-signs-of-hope/#comments</comments>
		<pubDate>Mon, 12 Apr 2010 07:31:03 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Good Jobs]]></category>
		<category><![CDATA[Green Economy]]></category>
		<category><![CDATA[Health care]]></category>
		<category><![CDATA[Housing]]></category>
		<category><![CDATA[Race]]></category>
		<category><![CDATA[Smart Growth]]></category>
		<category><![CDATA[Transportation]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=2218</guid>
		<description><![CDATA[If you&#8217;re feeling blue about our side&#8217;s chances of getting its act together, WE ACT for Environmental Justice, and several other environmental justice organizations from around the country just released a report you should check out:  Environmental Justice and the Green Economy. The report lays out three  principles for building a just, sustainable [...]]]></description>
			<content:encoded><![CDATA[<p>If you&#8217;re feeling blue about our side&#8217;s chances of getting its act together, <a href="http://www.weact.org">WE ACT for Environmental Justice</a>, and several other environmental justice organizations from around the country just released a report you should check out: <a href="http://www.weact.org/Publications/EJtheGreenEconomy/tabid/583/Default.aspx"> Environmental Justice and the Green Economy</a>. The report lays out three  <a href="http://www.weact.org/Portals/7/Publications/EJGE_Report_English.pdf">principles</a> for building a just, sustainable economy:<br />
<blockquote>
1. Strives for full democratic participation. </p>
<p>2. Builds capacity for a truly sustainable infrastructure and green economy. </p>
<p>3. Creates and share “green” wealth.</p></blockquote>
<p> The rest of the report shows how groups around the country are fighting for this vision.</p>
<p>Take Harlan County, Kentucky. You probably know about the environmental devastation caused by strip top mining. At the same time, most folks in Harlan County are in a no-win situation.<br />
<blockquote> There are few employment alternatives to coal-related jobs, even as coal employment in Kentucky is a third of what it was 30 years ago, largely due to the increased mechanization of the industry. Large absentee landlords and local land-owners are unaccountable to new forms of economic development. The local elite maintain tight control over politics, commerce, and public life in this region.</p></blockquote>
<p> But folks are fighting back, in part through a statewide organization called  <a href="http://www.kftc.org/">Kentuckians for the Commonwealth</a> (KFTC).<span id="more-2218"></span><br />
<blockquote>In Benham, a coalition made up of KFTC and the Mountain Association for Community Economic Development (MACED) is exploring a range of “green,” renewable energy sources. In addition to wind power, potential exists for micro-hydro power, utilizing the creeks that run through the towns, and small-scale solar energy. The coalition’s efforts are informed by two reports from the Massachusetts Institute of Technology: one on models for developing locally owned wind power and a second on viable strategies for local renewable energy and energy efficiency improvements. As the mines “write people off,” with job elimination that trigger growing desperation and anxiety, Harlan County KFTC leader, Carl Shoupe, a retired, disabled third generation miner, realizes that this moment is a “critical time” to take action.</p></blockquote>
<p> In San Diego, the  <a href="http://www.environmentalhealth.org/ ">Environmental Health Coalition</a> is also fighting to create a just, green economy for all. Last year, it<br />
<blockquote>successfully blocked the expansion of a fossil fuel power plant in Chula Vista, California, where over 80% of residents are people of color and 16% of all residents fall below the poverty line. This proposed plant expansion would have more than doubled the size of the existing plant&#8230;.  It would have been sited 1,300 feet from a local elementary school and only 350 feet from the nearest home in that community.</p></blockquote>
<p> In fighting against the plant expansion, which blatantly violated the town&#8217;s general plan that EHC spent two years working to pass, EHC didn&#8217;t just argue against the plant. They won in part because they proposed an alternative vision of the future.<br />
<blockquote>They drafted a detailed energy plan that described the rationale and benefits for alternatives such as solar arrays on rooftops and parking lots, repair of transmission lines, and improvement of residential energy efficiency. EHC also provided expert testimony and analysis showing that these options were not only feasible and cost effective, but could provide three to four times the energy that the proposed plant would provide.</p></blockquote>
<p> Similarly, in New York City, WE ACT has been fighting for years to take on pollution in their neighborhood.<br />
<blockquote> Five out of six public transit bus depots on Manhattan are located in the brown and black, low-income communities of Northern Manhattan. For the most part, these bus depots are situated close to apartments, schools, playgrounds, and senior centers. Inundated by toxic diesel pollution, residents suffer some of the highest rates of childhood asthma hospitalizations in the nation, and disproportionately high levels of other respiratory illnesses and heart disease. Northern Manhattan’s cancer and child-asthma rates exceed area, state, and national averages&#8230;.</p>
<p>Years of advocacy by WE ACT for Environmental Justice (WE ACT)2 and other partners have certainly helped lessen the toxic burden of these transit depots. Their coalition work has resulted, for example, in the conversions of 400 diesel buses into compressed natural gas buses, and another 900 into hybrid electric buses. But WE ACT’s environmental justice efforts go well beyond these near term mitigations.</p></blockquote>
<p> For example, after many years of community pressure, NYC&#8217;s MTA decided they would rebuild a Lower Manhattan bus depot that handles 120 buses a day. WE ACT trained folks in the community &#8220;in the principles of green building and the science of sustainability,&#8221; and now they are working with the MTA to create a truly green depot, including features such as &#8220;a green roof, air pollution controls, energy efficiency, and gray water reclamation.&#8221;</p>
<p>The report also highlights how some groups who began by fighting for economic justice have broadened their vision to for a just, sustainable economy. In Miami, in 2001 &#8220;the  <a href="http://www.theworkerscenter.org ">Miami Workers</a> Center (MWC) sought to prevent the demolition of low-income housing developments in Liberty City,&#8221; eventually forcing developers to build units that were affordable for everyone who lived in the development. As part of their experience in that fight, now one of their main goals is &#8220;to deepen community involvement in the redevelopment and green design process.&#8221;<br />
<blockquote> In early 2008, MWC collaborated with US Green Builders to host a community design competition, called a charette, of the Scott-Carver site. These charettes have served as a popular education piece for residents, and MWC members and have helped the wider community understand the connection between environmental and racial justice&#8230;.</p>
<p>Poinciana Industrial Park, a mostly vacant industrial site that for three decades was supposed to have brought economic development and opportunities to the black community. MWC is helping policy makers and developers understand the value of turning that Park into a “green enterprise zone” that will host small to medium scale green businesses.  In its attempt to reframe conventional “green” discourse, MWC uses the term “Community Driven Green Industry” to describe the public, non-profit, and private sector ventures that create environmentally friendly products and services that also generate long-term living-wage jobs at all skill levels. As Benford explained, MWC “really need[s] to drive consciousness of what kind of development we need to be focused on,” given Miami’s track record of pursuing “shallow” development versus wealth-generating development.</p></blockquote>
<p> And in LA, home of the highway car chase, last year the <a href= http://www.thestrategycenter.org/">Labor/Community Strategy Center</a> helped create <a href="http://www.thestrategycenter.org/project/transit-riderspublic-<br />
Transportation"> Transit Riders for Public Transportation</a>, a network of 11 groups across the country fighting to &#8220;bring environmental justice and civil rights priorities to the upcoming federal surface ransportation act—whose budget is estimated to be at least $500 billion.&#8221; Eric Mann, the Labor/Community Strategy Center&#8217;s Director, argues that<br />
<blockquote> a strong investment in public transportation can create real green jobs (defined as jobs that reduce fuel emissions, and provide sustainable, long term employment with promotions potential for minority populations).</p>
<p>The Labor/Community Strategy Center estimates, for instance, that 7,000 green jobs could be created for every 1,000 buses built. For every 100 buses, they estimate that 300 drivers could be hired to enable buses to run round the clock. Jobs in clerical work, cleaning and maintenance, bus mechanics, and bus construction would also be created&#8230;</p>
<p>&#8220;a mass transit system that prioritizes the needs of the most transit-dependent communities can serve the needs of all. The process of getting people out of their cars can begin now, not after manufacturing 200 million electric cars or after constructing a multi-billion or trillion dollar new rail project, or after transitioning to a clean electricity grid 20 years from now.&#8221;</p></blockquote>
<p>You can read more about these organization&#8217;s struggles and their vision of a better future for all in the <a href="http://www.weact.org/Publications/EJtheGreenEconomy/tabid/583/Default.aspx">Environmental Justice and the Green Economy</a> report. If you or your organization wants to endorse their Vision Statement, check out  <a href="http://ejstimulus.wordpress.com/selected-list-of-endorsers/<br />
">http://ejstimulus.wordpress.com/selected-list-of-endorsers/</a></p>
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		<title>Winning the Next Health Care Fight One Pothole at a Time</title>
		<link>http://rethinkecon.org/2010/04/08/winning-the-next-health-care-fight-one-pothole-at-a-time/</link>
		<comments>http://rethinkecon.org/2010/04/08/winning-the-next-health-care-fight-one-pothole-at-a-time/#comments</comments>
		<pubDate>Thu, 08 Apr 2010 06:58:34 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Choosing Together]]></category>
		<category><![CDATA[Health care]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=2213</guid>
		<description><![CDATA[When I first took a look at the list of projects in Chicago&#8217;s 49th Ward&#8217;s Participatory Budgeting experiment, I was a little disappointed. Participatory Budgeting sounds so lofty: We the People choosing directly. And yes, some of the items folks get to vote for are pretty cool, like art projects or community gardens. But most [...]]]></description>
			<content:encoded><![CDATA[<p>When I first took a look at the list of projects in Chicago&#8217;s 49th Ward&#8217;s<a href="/2010/04/05/potholes-and-people-power-in-chicagos-49th-ward/"> Participatory Budgeting experiment</a>, I was a little disappointed. Participatory Budgeting sounds so lofty: We the People choosing directly. And yes, some of the items folks get to vote for are pretty cool, like art projects or community gardens. But most of the voting choices are for mundane items like potholes and speed humps. </p>
<p>But then I thought about the nasty pothole I try to avoid while getting on the freeway ramp to work (unfortunately, public transit to my latest job is dismal). Almost every freakin&#8217; day it gets on my nerves. So do the drivers who, in an effort to spare their axles, make incredibly stupid, last-minute maneuvers. If I had the chance to rid myself of that jarring irritation at the start of every day, I&#8217;d vote that sucker off the asphalt island in a second.</p>
<p> And knowing that I and my neighbors had the power to make that call? I&#8217;m ashamed to admit, it would mean more to me than getting to vote for my city council rep. Except when my Councilperson does something really awful, I don&#8217;t pay that much attention. I know, bad, bad me.  But I&#8217;ve only got so many minutes and brain cells to spend every day, and DC&#8217;s city government feels like the weather &#8212; there&#8217;s not much you can do about it but complain. It feels too far away, too removed from my daily life. And the amount of work it would take to have a real impact feels overwhelming.</p>
<p>But voting on that pothole? It feels real &#8212; a victory in the daily battle against life&#8217;s small irritations.</p>
<p>Similarly, I&#8217;m sure my city council rep has voted to create a community garden or two in our district. But if I were the one doing the voting &#8212; and therefore meeting my neighbors who were pitching it &#8212; I&#8217;d feel a real sense of ownership. If my neighbors&#8217; and my votes gave the green light to that community garden, I&#8217;d check it out once in a while to see the results of our small exercise of power. Even if I never put seeds into the earth, I could look at it and say, I did that.</p>
<p>In turn, that small exercise the power might change the way I think about DC&#8217;s government. The $1.3 million budget I&#8217;d vote for is a drop in the city&#8217;s bucket. But if I had a real say over it, I might start paying more attention to where the rest of my city tax dollars were going. And now that my neighbors and I had taken smaller actions together, taking action together on a slightly bigger stage might not feel so overwhelming.</p>
<p>What does this have to do with healthcare reform? Polls have consistently shown that one of the biggest long-term obstacles to reform is that most folks don&#8217;t trust the federal government. They may vote for their senator and for Obama or McCain, but they don&#8217;t believe they&#8217;ll have a real say or that their needs will get met. We can probably get out of this mess by delivering more victories like the half-asked-but-way-better-than-status-quo healthcare bill. But taking small steps that hand back direct power, even if it&#8217;s just over potholes, could also make a real difference.</p>
<p>For example, one of the most important players in the fight for high quality health care for all that doesn&#8217;t bankrupt us is Medicare. Medicare solicits lots of &#8220;community input&#8221; through public hearings, etc. Right now, Big Pharma and other big players still win hands down because the rest of us are checked out. But if more folks had a real say over their community&#8217;s potholes, progresses might convince them it&#8217;s worth fighting to give everybody a real say over their community&#8217;s medical procedures.  Even in small doses, hope can do amazing things to the body politic.</p>
<p>Maybe potholes and speed comps aren&#8217;t so mundane after all.</p>
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		<title>Only Ten Republican Reps Aren&#8217;t Socialists</title>
		<link>http://rethinkecon.org/2010/02/09/only-ten-republican-reps-arent-socialists/</link>
		<comments>http://rethinkecon.org/2010/02/09/only-ten-republican-reps-arent-socialists/#comments</comments>
		<pubDate>Tue, 09 Feb 2010 12:39:28 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Aging]]></category>
		<category><![CDATA[Health care]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=1950</guid>
		<description><![CDATA[Snow isn&#8217;t the only thing in DC causing a little chaos. Rep. Paul Ryan, ranking member on the Committee on that Budget, has produced a Roadmap to eliminate the budget deficit. To do it, he turns Medicare and Social Security into voucher programs and cuts benefit increases. From the  Executive Summary:
* Preserves the existing [...]]]></description>
			<content:encoded><![CDATA[<p>Snow isn&#8217;t the only thing in DC causing a little chaos. Rep. Paul Ryan, ranking member on the Committee on that Budget, has produced a Roadmap to eliminate the budget deficit. To do it, he turns Medicare and Social Security into voucher programs and cuts benefit increases. From the  <a href="http://www.roadmap.republicans.budget.house.gov/plan/summary.htm">Executive Summary</a>:<br />
<blockquote>* Preserves the existing Medicare program for those 55 or older.</p>
<p>    * For those currently under 55 – as they become Medicare-eligible – creates a Medicare payment averaging $11,000 per year when fully phased in. Adjusts the payment for inflation, and pegs it to income, with low-income individuals receiving greater support. Provides risk adjustment, so those with greater medical needs receive a higher payment&#8230;. </p>
<p>     * Preserves the existing Social Security program for those 55 or older. </p>
<p>     * Offers workers under 55 the option of investing over one third of their current Social Security taxes into personal retirement accounts, similar to the Thrift Savings Plan available to Federal employees. Includes a property right so they can pass on these assets to their heirs, and a guarantee that individuals will not lose a dollar they contribute to their accounts, even after inflation.   </p>
<p>     * Makes the program permanently solvent, according to the CBO, by combining a more realistic measure of growth in Social Security’s initial benefits, with a gradual, modest increase in the retirement age, consistent with Americans’ improving lifespans.</p></blockquote>
<p> For some strange reason, the Free Market Cheerleader Club, a.k.a. the Republican Party, haven&#8217;t embraced Ryan&#8217;s plan. And as of last night &#8212; over a week after the plan was debuted and scored by the CBO &#8212; according to Talking Points Memo, only  <a href="http://tpmdc.talkingpointsmemo.com/2010/02/ryan-gets-a-little-help-from-his-friends---9-co-sponsors-sign-on-to-his-budget-roadmap.php">nine</a> Republicans have signed on as  cosponsors.</p>
<p>What&#8217;s the Republican leadership&#8217;s  problem with this attempt to curb the creeping socialism of Social Security and Medicare? TPM  <a href="http://tpmdc.talkingpointsmemo.com/2010/02/boehner-distances-republicans-from-ryan-budgetbut-he-cant-name-a-single-objection-1.php">explains</a>:<br />
<blockquote> when asked [on February 4] at a press conference what about Ryan&#8217;s budget he disagreed with, Minority Leader John Boehner couldn&#8217;t name anything.</p>
<p>&#8220;Off the top of my head, I couldn&#8217;t tell you,&#8221; Boehner said.</p>
<p>Despite the apparent lack of substantive disagreement, though, Boehner wants to keep the Ryan plan from sticking to the GOP.</p>
<p>&#8220;Paul Ryan, who&#8217;s the ranking member on our budget committee, has done an awful lot of work in putting together his roadmap,&#8221; Boehner said. &#8220;But it&#8217;s his. And I know the Democrats are trying to say that it&#8217;s the Republican leadership. But they know that&#8217;s not the case.&#8221;</p></blockquote>
<p> Will the government <a href="/2009/07/29/research-note-is-medicare-government/">keep its hands off Medicare</a>? Stay tuned&#8230;.</p>
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		<title>What the Health Insurance Companies Lost</title>
		<link>http://rethinkecon.org/2010/01/04/what-the-health-insurance-companies-lost/</link>
		<comments>http://rethinkecon.org/2010/01/04/what-the-health-insurance-companies-lost/#comments</comments>
		<pubDate>Mon, 04 Jan 2010 09:23:32 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Health care]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=1824</guid>
		<description><![CDATA[A lot of progressives are really pissed off at the crappy compromises that went into the healthcare bill. So am I. But after having a little time to let go of the fury I felt at just how much we&#8217;d lost, and after learning more about the details, I now think some of our  [...]]]></description>
			<content:encoded><![CDATA[<p>A lot of progressives are really pissed off at the crappy compromises that went into the healthcare bill. So am I. But after having a little time to let go of the fury I felt at just how much we&#8217;d lost, and after learning more about the details, I now think some of our  <a href="http://www.salon.com/news/opinion/glenn_greenwald/2009/12/18/corporatism/index.html">friends</a> are misreading this as a full-blown corporate win.  In doing so they aren&#8217;t taking seriously some of the long-term strategic advantages provided by the bill.  James Surowiecki <a href="http://www.newyorker.com/talk/financial/2010/01/04/100104ta_talk_surowiecki">explains</a> a crucial one:<br />
<blockquote>
Politicians on both sides of the aisle overwhelmingly believe [...] that insurance companies should be prohibited from taking preëxisting conditions into account when setting prices or extending coverage. Both the House and the Senate reform bills include language banning this. Even Republicans have been vehement on the subject: Senator Tom Coburn, of Oklahoma, has said that “everyone agrees” that we need to eliminate the use of preëxisting conditions, while Senator Chuck Grassley, of Iowa, declared that insurers have to be barred from “charging higher premiums to people who are sick.” The insurance companies themselves have accepted that the only factors they’ll be allowed to take into account in setting prices will be age, region, and whether or not someone smokes&#8230;.</p>
<p>So where’s the contradiction? Well, Congress’s support for community rating [i.e., no exclusions based on pre-existing conditions] and universal access doesn’t fit well with its insistence that health-care reform must rely on private insurance companies. After all, measuring risk, and setting prices accordingly, is the raison d’être of a health-insurance company. The way individual insurance works now, risk and price are linked. If you’re a triathlete with no history of cancer in your family, you’re a reasonably good risk, and so you can get an affordable policy that will protect you against unforeseen disaster; if you’re overweight with high blood pressure and a history of heart problems, your risk of becoming seriously ill is substantial, and therefore private insurers will either charge you high premiums or not offer you coverage at all. This kind of risk evaluation—what’s called “medical underwriting”—is fundamental to the insurance business. But it is precisely what all the new reform plans will ban. Congress is effectively making private insurers unnecessary, yet continuing to insist that we can’t do without them.</p>
<p>The truth is that we could do just fine without them: an insurance system with community rating and universal access has no need of private insurers&#8230;. </p>
<p>So if you want to make health insurance available to everyone, regardless of risk, the most sensible solution would be to expand Medicare to everyone. That’s not going to happen&#8230;. Instead of replacing private insurance companies, the proposed reforms would, in theory, turn them into something like public utilities. That’s how it works in the Netherlands and Switzerland, with reasonably good results. </p></blockquote>
<p>Yes, this puts a lot of money in insurance company pockets.  And yes, insurance company stock went up after the bill broke the deadlock &#8212; it was much better than the position many had expected they&#8217;d end up in.  But eliminating real risk management is in no way what insurance companies wanted.</p>
<p>Insurance companies will try to find ways to get around the new rules, but it&#8217;s a dangerous game.  Every time they find and exploit loopholes, more regulations will get passed to close them.  And with each round of evade and crackdown, Surowiecki&#8217;s question &#8212; do we really need health insurance companies anymore? – will gain traction.  </p>
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		<title>Great Parody, Scary Reality</title>
		<link>http://rethinkecon.org/2009/09/23/great-parody-scary-reality/</link>
		<comments>http://rethinkecon.org/2009/09/23/great-parody-scary-reality/#comments</comments>
		<pubDate>Tue, 22 Sep 2009 23:37:40 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Health care]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=1076</guid>
		<description><![CDATA[How do you do smart, funny progressive propaganda? Like this:

Protect Insurance Companies PSA from Will Ferrell
And that&#8217;s pretty damn impressive considering how hard it&#8217;s becoming to parody insurance companies. 
Take the letter America&#8217;s Health Insurance Plans&#8217; President and CEO Karen Ignagni  sent to Max Baucus. Among other requests,  Think Progress explains, the insurance [...]]]></description>
			<content:encoded><![CDATA[<p>How do you do smart, funny progressive propaganda? Like this:</p>
<p><object width="384" height="256" classid="clsid:d27cdb6e-ae6d-11cf-96b8-444553540000" id="ordie_player_041b5acaf5"><param name="movie" value="http://player.ordienetworks.com/flash/fodplayer.swf" /><param name="flashvars" value="key=041b5acaf5" /><param name="allowfullscreen" value="true" /><param name="allowscriptaccess" value="always"><embed width="384" height="256" flashvars="key=041b5acaf5" allowfullscreen="true" allowscriptaccess="always" quality="high" src="http://player.ordienetworks.com/flash/fodplayer.swf" name="ordie_player_041b5acaf5" type="application/x-shockwave-flash"></embed></object>
<div style="text-align:left;font-size:x-small;margin-top:0;width:384px;"><a href="http://www.funnyordie.com/videos/041b5acaf5/protect-insurance-companies-psa" title="from FOD Team, Will Ferrell, Jon Hamm, Olivia Wilde, Thomas Lennon, Donald Faison, Linda Cardellini, Masi Oka, Ben Garant, Jordana Spiro, lauren, Drew, and chad_carter">Protect Insurance Companies PSA</a> from <a href="http://www.funnyordie.com/will_ferrell">Will Ferrell</a></div>
<p>And that&#8217;s pretty damn impressive considering how hard it&#8217;s becoming to parody insurance companies. </p>
<p>Take the letter America&#8217;s Health Insurance Plans&#8217; President and CEO Karen Ignagni  <a href="http://wonkroom.thinkprogress.org/2009/09/22/ignagni-baucus-letter/">sent</a> to Max Baucus. Among other requests,  <a href="http://thinkprogress.org/">Think Progress</a> explains, the insurance companies said, we really, really need to keep shutting folks out of insurance:<br />
<blockquote>“This means that benefit packages should give consumers flexible options to meet diverse needs and be aligned with the level of premium subsidies provided by Congress, and that the coverage requirement needs to avoid creating incentives for healthy people to forego the purchase of coverage,” Ignagni writes. The letter also expresses concerns about the new national benefit standards. </p>
<p>In other words, insurers want to design packages that attract healthier applicants and deter “enrollment by those in poorer health.” “For example, insurers could offer a benefits design that omits or severely limits services needed by people with serious medical conditions, while offering richer benefits in other areas such as vision care or health-club memberships.”</p></blockquote>
<p> But don&#8217;t cut insurance company Medicare subsidies!<br />
<blockquote>The Baucus bill would eliminate the 13% overpayment to private insurance plans that provide Medicare-like benefits at a higher rate, without improving quality. Under the bill, private insurers would have to submit to a competitive bidding process. “We have strong concerns about the proposed funding cuts in Medicare Advantage,” Ignagni wrote.</p></blockquote>
<p> Oy.</p>
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		<title>Propaganda&#8217;s B Team: Kelloggs&#8217; &#8220;Smart Choice&#8221; Froot Loops</title>
		<link>http://rethinkecon.org/2009/09/09/propagandas-b-team-kelloggs-smart-choice-froot-loops/</link>
		<comments>http://rethinkecon.org/2009/09/09/propagandas-b-team-kelloggs-smart-choice-froot-loops/#comments</comments>
		<pubDate>Tue, 08 Sep 2009 22:46:56 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Health care]]></category>
		<category><![CDATA[People Aren't Calculators]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=910</guid>
		<description><![CDATA[ As  we&#8217;ve  seen, Big Pharma&#8217;s very sophisticated in how they pollute the info doctors and patients have take decisions about drugs. Food manufacturers?   Not so much.
 A new food-labeling campaign called Smart Choices, backed by most of the nation’s largest food manufacturers, is &#8220;designed to help shoppers easily identify smarter [...]]]></description>
			<content:encoded><![CDATA[<p><img src= "/wp-content/uploads/2009/09/smart_choices.jpg" align=right hspace="7" /> As  <a href="/2009/08/31/healthcare-the-hazards-of-the-moral-hazard-argument/ ">we&#8217;ve</a>  <a href="/2009/09/07/drug-companies-v-moral-hazard-geeks-why-traditional-econ-models-dont-cut-it/">seen</a>, Big Pharma&#8217;s very sophisticated in how they pollute the info doctors and patients have take decisions about drugs. Food manufacturers?   <a href="http://www.nytimes.com/2009/09/05/business/05smart.html?partner=rss&#038;emc=rss&#038;pagewanted=all ">Not</a> so much.<br />
<blockquote> A new food-labeling campaign called Smart Choices, backed by most of the nation’s largest food manufacturers, is &#8220;designed to help shoppers easily identify smarter food and beverage choices.&#8221; </p></blockquote>
<p><img src= "/wp-content/uploads/2009/09/fruit_loops.jpg" align=right hspace="7" />Two &#8220;Smart Choices&#8221;: Cocoa Krispies and Froot Loops.</p>
<p>Eileen T. Kennedy, &#8220;president of the Smart Choices board and the dean of the Friedman School of Nutrition Science and Policy at Tufts University,&#8221; says, yes, these are smart choices:<br />
<blockquote>“You’re rushing around, you’re trying to think about healthy eating for your kids and you have a choice between a doughnut and a cereal,” Dr. Kennedy said, evoking a hypothetical parent in the supermarket. “So Froot Loops is a better choice.”</p></blockquote>
<p>If this was a movie, critics would say it was left-wing propaganda, with Dr. Kennedy a  <a href="http://en.wikipedia.org/wiki/Straw_man">straw man</a>.</p>
<p>Speaking of straw, that would probably be a Smart Choice too:<br />
<blockquote>“You could start out with some sawdust, add calcium or Vitamin A and meet the criteria,” Mr. Jacobson [executive director of the Center for Science in the Public Interest] said.</p></blockquote>
<p>Interestingly, part of the argument folks like Dr. Kennedy are making in favor of Smart Choices is that it&#8217;s based on research on how the non-rational ways people actually make decisions:<br />
<blockquote>She said the program was also influenced by research into consumer behavior. That research showed that, while shoppers wanted more information, they did not want to hear negative messages or feel their choices were being dictated to them. </p>
<p>“The checkmark means the food item is a ‘better for you’ product, as opposed to having an x on it saying ‘Don’t eat this,’ ” Dr. Kennedy said. “Consumers are smart enough to deduce that if it doesn’t have the checkmark, by implication it’s not a ‘better for you’ product. They want to have a choice. They don’t want to be told ‘You must do this.’ ” </p></blockquote>
<p>Ditto for Dr. Clark, another member of the Smart Choices board, who argues<br />
<blockquote>the program’s standard for sugar in cereals was consistent with federal dietary guidelines that say that “small amounts of sugar” added to nutrient-dense foods like breakfast cereals can make them taste better. That, in theory, will encourage people to eat more of them, which would increase the nutrients in their diet.</p></blockquote>
<p>Given what a sad excuse for propaganda this program is, is it really worth it for the food companies?<br />
<span id="more-910"></span><br />
For starters, it&#8217;s dirt cheap. Depending on sales of their products with the seal, companies pay up to $100K a year &#8212; less than a 20th of a TV buy. In fact, it&#8217;ll <b>save</b> some companies money:<br />
<blockquote>In joining Smart Choices, the companies agreed to discontinue their own labeling systems, Ms. Kennedy said.</p></blockquote>
<p>And it&#8217;s a percentage game.  If just some people some of the time use the Smart Choices label as an excuse &#8212; say, to give into their four-year-old&#8217;s insistence that they HAVE to have Fruit Loops &#8212; it&#8217;s a win.  <a href="http://www.cbsnews.com/stories/2009/09/06/eveningnews/main5291352.shtml">CBS</a> already found one small victory:<br />
<blockquote>Shopper Laurie Adams told us that she believed the green check mark meant that the product was a healthy choice.</p></blockquote>
<p><img src= "/wp-content/uploads/2009/09/cocoa_Krispies.jpg" align=right hspace="7" />The FDA isn&#8217;t going to stop this pathetic-but-profitable propaganda push, but they told the program they&#8217;ll be watching,</p>
<blockquote><p>saying they intended to monitor its effect on the food choices of consumers. </p>
<p>The letter said the agencies would be concerned if the Smart Choices label “had the effect of encouraging consumers to choose highly processed foods and refined grains instead of fruits, vegetables and whole grains.”</p></blockquote>
<p>Should be interesting to see what they find &#8212; and yet another chance to measure exactly how much  <a href="/2009/05/13/assumption-people-arent-calculators/"> People Aren&#8217;t Calculators</a>.</p>
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		<title>Drug Companies v Moral Hazard Geeks:  Why Traditional Econ Models Don&#8217;t Cut It</title>
		<link>http://rethinkecon.org/2009/09/07/drug-companies-v-moral-hazard-geeks-why-traditional-econ-models-dont-cut-it/</link>
		<comments>http://rethinkecon.org/2009/09/07/drug-companies-v-moral-hazard-geeks-why-traditional-econ-models-dont-cut-it/#comments</comments>
		<pubDate>Sun, 06 Sep 2009 22:46:05 +0000</pubDate>
		<dc:creator>admin</dc:creator>
				<category><![CDATA[Assumptions]]></category>
		<category><![CDATA[Health care]]></category>
		<category><![CDATA[Model]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=859</guid>
		<description><![CDATA[Aside from being truly appalling, the subject of last week&#8217;s  post is a great example of how  traditional economic models don&#8217;t work. To recap via the New York Times:
 A growing body of evidence suggests that doctors at some of the nation’s top medical schools have been attaching their names and lending their [...]]]></description>
			<content:encoded><![CDATA[<p>Aside from being truly appalling, the subject of last week&#8217;s  <a href=" /2009/08/31/healthcare-the-hazards-of-the-moral-hazard-argument/">post</a> is a great example of how  traditional economic models don&#8217;t work. To recap via the <a href="http://www.nytimes.com/2009/08/19/health/research/19ethics.html?partner=rss&#038;emc=rss&#038;pagewanted=all">New York Times</a>:</p>
<blockquote><p> A growing body of evidence suggests that doctors at some of the nation’s top medical schools have been attaching their names and lending their reputations to scientific papers that were drafted by ghostwriters working for drug companies — articles that were carefully calibrated to help the manufacturers sell more products.</p></blockquote>
<p>If you asked Professor <a href=" /2009/08/31/healthcare-the-hazards-of-the-moral-hazard-argument/">Saviro</a> about the way drug companies infect the information patients and their doctors have to make decisions, I&#8217;m sure he&#8217;d say yes of course this is bad. But when he and many other smart policy geeks when they write about reforming health care, these appalling facts are never front and center. They&#8217;re quietly shoved under the rug.</p>
<p>A good economic framework wouldn&#8217;t let that happen.   I&#8217;m not sure how to diagram this; this is my first draft.</p>
<p>A traditional model emphasizing moral hazard looks like this:</p>
<table border="1" cellpadding="3">
<tr>
<td>Market rules</td>
<td> Government sets taxes to push companies to pay for insurance </td>
</tr>
<tr>
<td halign="top">Organizations</td>
<td halign="top">My employer pays most of my health care costs </td>
</tr>
<tr>
<td halign="top">Individuals</td>
<td halign="top">Should I get this pill? It doesn&#8217;t cost me a lot </td>
</tr>
</table>
<p><br/>The RTE model adds in how drug companies try to shape market rules:<br />
<table border="1" cellpadding="3">
<tr>
<td>Market rules</td>
<td> Government sets taxes to push companies to pay for insurance </td>
<td> Big Pharma ghosts articles promoting their drugs</td>
</tr>
<tr>
<td halign="top">Organizations</td>
<td halign="top">My employer pays most of my health care costs </td>
<td> my doctor&#8217;s practice is biased towards these drugs </td>
</tr>
<tr>
<td halign="top">Individuals</td>
<td halign="top">Should I get this pill? It doesn&#8217;t cost me a lot </td>
<td> I am biased towards these drugs</td>
</tr>
</table>
<p><br/> Imagine if any economic discussion of health care was working from a model like this. How much time would these discussions spend trying to come up with ways of jacking up patients to get rid of moral hazard vs. asking how drug companies ended up with this much power and what do we do about it?</p>
<p>More importantly, if every economic argument worked off of a model like this, we might actually be <i>having</i> a debate right now. Because if you&#8217;re working from this model, the first question you&#8217;re going to ask when &#8220;death panels&#8221; are injected into the discussion is, which economic actors are pushing the idea of these nonexistent death panels?</p>
<p>Folks like  <a href=" http://mediamatters.org/">Media Matters</a>,  the  <a href=" http://www.msnbc.msn.com/id/26315908/">Rachel Maddow Show</a>, and many blogs are trying to get these facts into the debate, but they dismissed as corporate-hating liberals. Part of the reason the media can get away with this is because traditional models only pay attention to column 2. But with the RTE model, you&#8217;re forced also pay attention to column 3. </p>
<p>And as RTE explains, this isn&#8217;t about evil behavior. It&#8217;s perfectly rational and expected behavior. Unlike  <a href=" http://rethinkecon.org/2009/05/04/principle-4-use-checks-and-balances/">lionesses</a>, who can only win by playing by the rules of their ecosystem, corporations can also try to win by changing the rules of their ecosystem.</p>
<p>If policy geeks took seriously the realities that are baked into this model, we&#8217;d be looking at a very different kind of discussion.</p>
<hr/>
<p>UPDATE:  I&#8217;m not naive enough to think that policy geeks determine media coverage.  But if everybody who was serious worked from an economic model that didn&#8217;t deny reality, I think more reporters &#8212; and more importantly, more editors &#8212; would have a hard time just running quotes from policy geeks who didn&#8217;t use the model.  Given the on-the-one-hand, on-the-other-hand style of coverage we&#8217;ve got now, the policy geeks who are just shills would still get lots of coverage.  But at least the debate would have a <i>little</i> more reality to it.</p>
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		<title>Is Grassley a Socialist?</title>
		<link>http://rethinkecon.org/2009/09/02/is-grassley-a-socialist/</link>
		<comments>http://rethinkecon.org/2009/09/02/is-grassley-a-socialist/#comments</comments>
		<pubDate>Tue, 01 Sep 2009 22:44:04 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Health care]]></category>
		<category><![CDATA[Stacking the Deck]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=837</guid>
		<description><![CDATA[Monday&#8217;s  post explored how Big Pharma ghostwrites articles for doctors to promote their drugs.  Universities, the AMA &#8212; they&#8217;re all basically do what they can to avoid seriously dealing with this crisis in medical ethics. Guess who&#8217;s decided to step in? Senator Charles Obama-wants-death-panels, &#8220;the government is a predator not a competitor&#8221; Grassley.
Grassley [...]]]></description>
			<content:encoded><![CDATA[<p>Monday&#8217;s  <a href="/2009/08/25/healthcare-the…azard-argument/">post</a> explored how Big Pharma ghostwrites articles for doctors to promote their drugs.  Universities, the AMA &#8212; they&#8217;re all basically do what they can to avoid seriously dealing with this crisis in medical ethics. Guess who&#8217;s decided to step in? Senator Charles Obama-wants-death-panels, &#8220;<a href="http://www.talkingpointsmemo.com/livewire/2009/08/sen-grassley-on-health-care-the-government-is-a-predator.php">the government is a predator not a competitor</a>&#8221; Grassley.</p>
<p>Grassley recently sent a letter to National Institute of Health saying they need to crack down. Why is Grassley putting pressure on the NIH as opposed to, say, lobbying the AMA? As the <a href="http://www.nytimes.com/2009/08/19/health/research/19ethics.html?partner=rss&#038;emc=rss&#038;pagewanted=all">New York Times</a> explains,</p>
<blockquote><p>That is significant because the N.I.H., a federal agency in Bethesda, Md., underwrites much of the country’s medical research. Many of the nation’s top doctors depend on federal grants to support their work, and attaching fresh conditions to those grants could be a powerful lever for enforcing new ethical guidelines on the universities.</p></blockquote>
<p>In other words, Grassley wants to the power of Big Predator Government to distort the market &#8212; and, one assumes, destroy freedom. Senator, feel free to send your next corporate donation <a href=" http://www.sp-usa.org/">here</a>.</p>
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		<title>Healthcare: the Hazards of the Moral Hazard Argument</title>
		<link>http://rethinkecon.org/2009/08/31/healthcare-the-hazards-of-the-moral-hazard-argument/</link>
		<comments>http://rethinkecon.org/2009/08/31/healthcare-the-hazards-of-the-moral-hazard-argument/#comments</comments>
		<pubDate>Sun, 30 Aug 2009 22:31:04 +0000</pubDate>
		<dc:creator>RethinkEcon</dc:creator>
				<category><![CDATA[Health care]]></category>
		<category><![CDATA[People Aren't Calculators]]></category>

		<guid isPermaLink="false">http://rethinkecon.org/?p=770</guid>
		<description><![CDATA[In a post on the economic issues around health insurance, Professor Dan Saviro makes the standard &#8220;moral hazard&#8221; argument:
 Consumer demand drives the market, but it is largely the demand of subsidized consumers who are not actually paying at the margin for what they get. Suppose that in the market for groceries or cars we [...]]]></description>
			<content:encoded><![CDATA[<p>In a post on the economic issues around health insurance, Professor <a href=" http://danshaviro.blogspot.com/2009/08/healthcare-reform.html">Dan Saviro</a> makes the standard &#8220;moral hazard&#8221; argument:</p>
<blockquote><p> Consumer demand drives the market, but it is largely the demand of subsidized consumers who are not actually paying at the margin for what they get. Suppose that in the market for groceries or cars we had consumer demand in the driver&#8217;s seat (as we do), except that people didn&#8217;t actually have to pay for what they purchased (or maybe they just had a small co-pay). Whole Foods and GM might like this, but it wouldn&#8217;t be good socially. Yet in healthcare, that&#8217;s effectively what we have, much of the time, for people on Medicare, Medicaid, or employer-provided health insurance that overpays at the margin (relative to the optimal insurance level) due to the distorting effect of the tax subsidy.</p></blockquote>
<p>There are a number of problems with moral hazard arguments in healthcare. For example, the biggest hit in healthcare costs is when choose one sick, and if people were &#8220;actually paying at the margin for what they get&#8221; such that it would change their behavior when they were really sick, they&#8217;d probably go bankrupt. </p>
<p>But there&#8217;s a more basic problem with this argument. Saviro assumes consumers have meaningful info about the healthcare &#8220;product&#8221; they&#8217;re considering buying. If you want to buy a car from GM, you can see what Consumer Reports or Road &#038; Track said about it. But what about the pill your doctor just recommended you take?</p>
<p>Let&#8217;s assume that unlike many folks, you&#8217;ve got the high-level reading skills and the time needed to read up about it. Here&#8217;s the catch: you can&#8217;t trust what you read. According to the <a href="http://www.nytimes.com/2009/08/19/health/research/19ethics.html?partner=rss&#038;emc=rss&#038;pagewanted=all">New York Times</a>,</p>
<blockquote><p> A growing body of evidence suggests that doctors at some of the nation’s top medical schools have been attaching their names and lending their reputations to scientific papers that were drafted by ghostwriters working for drug companies — articles that were carefully calibrated to help the manufacturers sell more products.</p></blockquote>
<p>Got that? Drug companies aren&#8217;t just paying doctors to do research. They&#8217;re also helping the lazy bums who can&#8217;t even be bothered to write the paper themselves. A case in point from a hormone drug lawsuit:</p>
<blockquote><p>The [deposed] documents offer a look at the inner workings of DesignWrite, a medical writing company hired by Wyeth to prepare an estimated 60 articles favorable to its hormone drugs. In one publication plan, for example, DesignWrite wrote that the goal of the Wyeth articles was to de-emphasize the risk of breast cancer associated with hormone drugs, promote the drugs as beneficial and blunt competing drugs. The articles were published in medical journals between 1998 and 2005 — continuing even though a big federal study was suspended in 2002 after researchers found that menopausal women who took certain hormones had an increased risk of invasive breast cancer and heart disease.
</p></blockquote>
<p>One lazy physician who was assisted by DesignWrite was Columbia professor Dr. Michelle P. Warren.</p>
<blockquote><p> Her article was published in The American Journal of Obstetrics and Gynecology in 2004, when women feared that Wyeth’s brand of hormone drugs could be causing particular problems. The thesis of the article was that no one hormone therapy was safer than another.</p>
<p>The published article acknowledged help from four people. But it did not disclose that DesignWrite employed two of those people and the other two worked at Wyeth. Court documents show DesignWrite sent a prepublication copy to Wyeth for vetting and charged Wyeth $25,000 for the article, information not disclosed in the paper.
</p></blockquote>
<p>When the Times contacted Dr. Warren, here&#8217;s how she defended herself:</p>
<blockquote><p> She said she worked on the project in phone conversations and in meetings — contributions not reflected in the court documents, she added. She said that it was a mistake not to have disclosed the writers’ payment and affiliations in the acknowledgment; articles published today involve more detailed disclosures, she said.  DesignWrite scoured the scientific literature on hormone therapy for the article, she said. “I would never undertake this without some help,” said Dr. Warren, who is the Wyeth-Ayers Professor of Women’s Health at Columbia. “It’s too much work. I am not getting paid for it.”</p></blockquote>
<p>Holy crap&#8230;</p>
<p>Next week:  what this means for building a better economic model.</p>
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