Category Archives: lobbying

Invasion of the Body Scanners: Airport Security May Not Work, But It Does Cause Cancer

Posted on November 23, 2010 by | 12 Comments

On the eve of some of the busiest travel days of the year, airport scanners are causing hysteria–and with good reason. Never mind the puerile TSA screeners giggling at your naked body. It turns out that the things may pose serious health concerns. In a letter to John Pistole, administrator of TSA, New Jersey Congressman Rush Holt, a scientist and the Chairman of the House Select Intelligence Oversight Panel, raised the possibility that the machines might be carcinogenic.

In March, the Congressional Biomedical Caucus (of which I am a co-chair) hosted a presentation on this technology by TSA, as well as a briefing by Dr. David Brenner of Columbia University on the potential health effects of “back scatter” x-ray devices. As Dr. Brenner noted in his presentation and in subsequent media interviews, the devices currently in use and proposed for wider deployment this year currently deliver to the scalp “20 times the average dose that is typically quoted by TSA and throughout the industry.”

Dr. Brenner has pointed out that the majority of the radiation from X-ray backscatter machines strikes the top of the head, which is where 85 percent of the 800,000 cases of basal cell carcinoma diagnosed in the United States each year develop. According to Dr. Brenner, excessive x-ray exposure can act as a cancer rate multiplier, which is why our government should investigate thoroughly the potential health risks associated with this technology.V

Various experts have questioned whether older people and children ought to be subjected to scanners, and whether people susceptible to or having melanoma and cataracts should undergo the scan. 

Holt also questioned the efficacy of the body scanners, which would come as no surprise to critics who’ve been lambasting them for years. Last January, when the government’s appetite for body scanners got a big boost from the underwear bomber, there was skepticism about their ability to detect the types of explosives favored by would-be airline bombers. As I wrote at the time:

Known by their opponents as “digital strip search” machines, the full-body scanners use one of two technologies—millimeter wave sensors or backscatter x-rays—to see through clothing, producing ghostly images of naked passengers. Yet critics say that these, too, are highly fallible, and are incapable of revealing explosives hidden in body cavities—an age-old method for smuggling contraband. If that’s the case, a terrorist could hide the entire bomb works within his or her body, and breeze through the virtual strip search undetected. Yesterday, the London Independent reported on “authoritative claims that officials at the [UK] Department for Transport and the Home Office have already tested the scanners and were not persuaded that they would work comprehensively against terrorist threats to aviation.” A British defense-research firm reportedly found the machines unreliable in detecting “low-density” materials like plastics, chemicals, and liquids—precisely what the underwear bomber had stuffed in his briefs.

Just to be sure I am not going off the deep end on this subject, I emailed Steve Elson, the intrepid former Navy Seal who worked on the federal government’s Red Team, which was deployed  in the years before 9/11 to test airport security by infiltrating through check points. This they did with ease; but noone ever paid any attention to their reports. Since 9/11 Elson has worked on and off with television crews, continuing to penetrate airport security carrying with him all manner of guns and IEDs, and for the most part avoiding detection. In a CBC program last year at this time, the Canadians reviewed the air security situation and found it to be wanting. The reporters also got hold of a redacted report from the Canadian transport people which raised questions about the effectiveness of full body scanners, especially when they are used in combination with metal detectors: A person passing through one machine after another would have to place their arms in different positions and the Canadians found the body scanners would fail to detect objects like rings or bracelets on extended arms because the mechanism could not reach high enough to take them in.

This morning’s Washington Post carried a list of people exempt from body scanning, including cops and military in uniform. I asked Elson about this, and he replied:

When I was traveling through Chicago last January on my way to Toronto to do an interview, I had some time between planes. Got a sandwich. No place to sit down so I literally walked into the back of a checkpoint that was enclosed by glass so everyone could see what was going on, sat down on a bench and ate my sandwich, and  watched. Noone touched the pilots. Ergo, all I needed was a pilot’s uniform, bought or stolen, and a photoshop badge. Put explosives on my body, no metal, walk through, pick up my stuff and off to the plane. Likewise, I could do something similar on the ramp. Best time is in cold weather and snow storms. Do it as night approaches. People don’t care about security, just getting the job done and getting out of the weather. Steal a bag tag, make an unauthorized entry (no problem), walk up to a plane and throw it in with 50 lbs explosive.

Elson has always contended that the body scanner couldn’t detect explosives in body cavities. In his email he added this: “The machine can see through a thin layer of clothing and probably detect explosives strapped to the body.” But he pointed out that Leslie Stahl on “60 Minutes” worried about exposing private parts, but  noted she could see a woman’s bra. “If she could see the bra, that means she could not see through the bra. A bra bomb or explosives molded to the breast wouldn’t be seen,” he continues. “And a woman, because of her anatomical construction, could easily… bring a several pound IED fully assembled with timer, detonator, power sources right through the checkpoint. If scanned or patted down it would make no difference. Once on the plane she has the option to leave it in  the plane…and get off.” Ellison warns that a well planned Al Qaeda operation, ”if they did it right, could knock down 50 planes in 30 minutes. Think about what that would do to US air operations.”

In my opinion, the best answer to airport security is the mass deployment of dogs. Give me a friendly German Shepherd, and I’ll gladly submit to being sniffed, rather than patted, wanded, or scanned. But unlike the scanner companies, dogs have no powerful lobbyists, like former Homeland Security chief Michael Chertoff, to advocate on their behalf.

Make room for Fido

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Obama’s Cat Food Commission, Alan Greenspan, and the Dancing Grannies for Medicare

Posted on August 9, 2010 by | 4 Comments

President Obama’s Deficit Commission is all smoke and mirrors. Its members are making a big show of laboring over ”painful” choices and considering all options in their quest to bring down the deficit. But  inside the Beltway everyone knows what’s going to happen: The commission will reduce the deficit on the backs of the old and the poor, through cuts to Social Security, Medicare, and Medicaid. Some opponents have taken to calling it the Cat Food Commission, since that’s what it’s victims will be forced to eat once the commission gets done slashing away at their modest entitlements.

In fact, the true intent of the Deficit Commission was evident before it was even formed. That intent was only driven home when Obama appointed as its co-chair Alan Simpson, who is well known for voicing, in the most colorful terms, what Paul Krugman calls the “zombie lie” that old-age entitlements will soon bankrupt the country.

So why the big show? Because neither Obama nor the Congress wants to get caught cutting Social Security and Medicare in public, certainly not before the November elections. (Medicaid will be cut as well, but politicians tend not to worry so much about poor people, since they don’t go to the polls in the numbers we geezers do.) So instead, they are foisting off this unpleasant task onto the Deficit Commission, showing what the lawyers call “due diligence,” sucking their thumbs and pretending to study how to cut the deficit. They’ve got $1 billion in walk-around money to pay for propaganda so the PR industry ought to be plenty happy. So too, should billionaire Pete Peterson, as he and his foundation lackeys push forward towards a victory in their longstanding attack on entitlements.

Quite frankly, if the Republican Right could get itself together and shove the Tea Party nuts back into their cave–as Reagan did with the crackpots hanging around him–they too could reap the benefits of the Cat Food Commission’s work. Ever since the New Deal, the Right has been kicking and screaming about Social Security. Things just got worse in the 1960s with Medicare and Medicaid. And now, thanks to our supposedly “socialist” president, they are within a few inches of cutting a nice hefty hunk out of the largest social programs this nation has ever known.

As one Capital Hill player recently wrote me: “Unfortunately, everyone in a position of power up here knows full-well the connection between Peterson, the commission and Simpson.  They either don’t care or are too afraid to say anything because they’ll appear ‘soft on deficits.’  It’s no different than their Iraq war votes…they believe they’ll appear ‘weak’ if they don’t jump on the bandwagon. The Democrats, (with the exception of Nancy Pelosi and only a handful of others–including commission member Jan Schakowsky), have no intention of taking on Peterson’s crew.  Congress may be  a lost cause on this issue, if the voters don’t get pissed off about the Commission fast.” 

Will enough voters get pissed off enough, soon enough to slow down the anti-entitlement juggernaut? It’s a long shot, at this point. There are signs of something like a small movement growing around the Cat Food Commission idea, and scattered protests (among them a demonstration dubbed the “Dancing Grannies for Medicare.”)

But it’s going to take a lot to waylay the likely course of future events:  The Cat Food Commission will undoubtedly recommend, and a lame duck Congress will pass, legislation that looks fairly innocuous: trimming Social Security a bit, maybe by upping the age by a few years, and cutting a little from Medicare–none of it affecting anyone who is over 65 right now. That will enable the politicians now in office to look like they are protecting seniors and fending off any drastic cuts, while at the same time appearing “tough” on the deficit. But the legislation, in the usual Washington mode, will gradually widen as the years go by, so that by the time this bunch of pols are retired (on their fat pensions) and out of the fray, the new rules will be eating  into entitlements in a big way.

The other side of this Faustian bargain would appear to be Congress passing some tax increases. ”In setting up his National Commission on Fiscal Responsibility and Reform,” William Greider recently wrote in The Nation, ”Barack Obama is again playing coy in public, but his intentions are widely understood among Washington insiders.” As Greider puts it, ”The president intends to offer Social Security as a sacrificial lamb to entice conservative deficit hawks into a grand bipartisan compromise in which Democrats agree to cut Social Security benefits for future retirees while Republicans accede to significant tax increases to reduce government red ink.”

It remains to be seen how “significant” those tax increases actually turn out to be. But even former Federal Reserve Chair Alan Greenspan seems to be on board with this general plan. Greenspan’s credentials include chairing the first major entitlement-cutting commission back in the 1980s, as well as promoting the Bush-era tax cuts that helped the deficit grow to its current proportions. He still says that reductions to Medicare benefits are necessary–but in a recent interview in the New York Times, Greenspan also says that he now wants to remove all the Bush tax cuts. Seeing as it comes from the champion of “let them eat cake” economics, this pronouncement must be seen as predictor of how conservatives could end up voting. In short, the old and the poor will have to eat cat food, but the rich might kick in a few crumbs as well.

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Posted in 2010 elections, budget / tax policy, Bush Administration, Congress, Congressional Democrats, Congressional Republicans, economy, generations / intergenerational issues, lobbying, media, Medicare, Obama Administration, right wing, Social Security

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How We Pay Wall Street to Screw Us

Posted on August 8, 2010 by | Leave a comment

Our taxes, paid into the public treasury, have gone to bail out Wall Street. And what do bankers  do with the taxpayers’s money? They turn around and lobby for more. It’s called the “never give a sucker an even break” strategy. These statistics, prepared by Public Citizen, speak for themselves:

  • Amount financial industry has spent on lobbying this year: $251 million
  • Amount Citigroup spent on lobbying during the first half of 2010: $3 million
  • Amount Goldman Sachs spent on lobbying in the first half of 2010: $2.7 million
  • Amount Bank of America spent on lobbying in the first half of 2010: $2.1 million

 

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Posted in budget / tax policy, corporations, economy, financial crisis / recession, lobbying, Wall Street / financial industry

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Meet the Real Death Panels: The Truth About Age-Based Health Care Rationing

Posted on July 12, 2010 by | 3 Comments

The latest issue of Mother Jones includes an article by me about the controversy over age-based health care rationing, which got transformed by the right into government “death panels.” Unfortunately, liberals have fallen into a different trap, because they refuse to take on the real enemies of affordable health care for all: the insurance companies, drug manufacturers, and other profiteers of our private health care system.

As a result, old people are being asked if we would be willing to give up some expensive, life-sustaining treatment so that our grandchildren can have health care. This is a bogus question, and a bogus “choice.” The real question, as I say in the article, is whether we should give up the treatment “so some WellPoint executive can take another expensive vacation, so Pfizer can book $3 billion in annual profits instead of $2 billion, or so private hospitals can make another campaign contribution to some gutless politician.”

It’s a long article, and I’m including just the opening here, with a link at the end to continue reading at the Mother Jones web site. Or you can read the whole thing at MotherJones.com by clicking here. And if you’re one of those geezers who still likes reading print and turning pages, the July/August issue is on newsstands now.

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From Mother Jones, July/August 2010

There’s a certain age at which you cease to regard your own death as a distant hypothetical and start to view it as a coming event. For me, it was 67—the age at which my father died. For many Americans, I suspect it’s 70—the age that puts you within striking distance of our average national life expectancy of 78.1 years. Even if you still feel pretty spry, you suddenly find that your roster of doctor’s appointments has expanded, along with your collection of daily medications. You grow accustomed to hearing that yet another person you once knew has dropped off the twig. And you feel more and more like a walking ghost yourself, invisible to the younger people who push past you on the subway escalator. Like it or not, death becomes something you think about, often on a daily basis.

Actually, you don’t think about death, per se, as much as you do about dying—about when and where and especially how you’re going to die. Will you have to deal with a long illness? With pain, immobility, or dementia? Will you be able to get the care you need, and will you have enough money to pay for it? Most of all, will you lose control over what life you have left, as well as over the circumstances of your death?

These are precisely the preoccupations that the right so cynically exploited in the debate over health care reform, with that ominous talk of Washington bean counters deciding who lives and dies. It was all nonsense, of course—the worst kind of political scare tactic. But at the same time, supporters of health care reform seemed to me too quick to dismiss old people’s fears as just so much paranoid foolishness. There are reasons why the death-panel myth found fertile ground—and those reasons go beyond the gullibility of half-senile old farts.

While politicians of all stripes shun the idea of health care rationing as the political third rail that it is, most of them accept a premise that leads, one way or another, to that end. Here’s what I mean: Nearly every other industrialized country recognizes health care as a human right, whose costs and benefits are shared among all citizens. But in the United States, the leaders of both political parties along with most of the “experts” persist in treating health care as a commodity that is purchased, in one way or another, by those who can afford it. Conservatives embrace this notion as the perfect expression of the all-powerful market; though they make a great show of recoiling from the term, in practice they are endorsing rationing on the basis of wealth. Liberals, including supporters of President Obama’s health care reform, advocate subsidies, regulation, and other modest measures to give the less fortunate a little more buying power. But as long as health care is viewed as a product to be bought and sold, even the most well-intentioned reformers will someday soon have to come to grips with health care rationing, if not by wealth then by some other criteria.

In a country that already spends more than 16 percent of each GDP dollar on health care (PDF), it’s easy to see why so many people believe there’s simply not enough of it to go around. But keep in mind that the rest of the industrialized world manages to spend between 20 and 90 percent less per capita and still rank higher than the US in overall health care performance. In 2004, a team of researchers including Princeton’s Uwe Reinhardt, one of the nation’s best known experts on health economics, found that while the US spends 134 percent more than the median of the world’s most developed nations, we get less for our money—fewer physician visits and hospital days per capita, for example—than our counterparts in countries like Germany, Canada, and Australia. (We do, however, have more MRI machines and more cesarean sections.)

Where does the money go instead? By some estimates, administration and insurance profits alone eat up at least 30 percent of our total health care bill (and most of that is in the private sector—Medicare’s overhead is around 2 percent). In other words, we don’t have too little to go around—we overpay for what we get, and we don’t allocate our spending where it does us the most good. “In most [medical] resources we have a surplus,” says Dr. David Himmelstein, cofounder of Physicians for a National Health Program. “People get large amounts of care that don’t do them any good and might cause them harm [while] others don’t get the necessary amount.”

Looking at the numbers, it’s pretty safe to say that with an efficient health care system, we could spend a little less than we do now and provide all Americans with the most spectacular care the world has ever known. But in the absence of any serious challenge to the health-care-as-commodity system, we are doomed to a battlefield scenario where Americans must fight to secure their share of a “scarce” resource in a life-and-death struggle that pits the rich against the poor, the insured against the uninsured—and increasingly, the old against the young.

For years, any push to improve the nation’s finances—balance the budget, pay for the bailout, or help stimulate the economy—has been accompanied by rumblings about the greedy geezers who resist entitlement “reforms” (read: cuts) with their unconscionable demands for basic health care and a hedge against destitution. So, too, today: Already, President Obama’s newly convened deficit commission looks to be blaming the nation’s fiscal woes not on tax cuts, wars, or bank bailouts, but on the burden of Social Security and Medicare. (The commission’s co-chair, former Republican senator Alan Simpson, has declared, “This country is gonna go to the bow-wows unless we deal with entitlements.”)

Old people’s anxiety in the face of such hostile attitudes has provided fertile ground for Republican disinformation and fearmongering. But so has the vacuum left by Democratic reformers. Too often, in their zeal to prove themselves tough on “waste,” they’ve allowed connections to be drawn between two things that, to my mind, should never be spoken of in the same breath: death and cost.

Click here to the rest at MotherJones.com.

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Posted in budget / tax policy, Congressional Democrats, Congressional Republicans, corporations, death / end of life care and choices, drug industry, financial crisis / recession, generations / intergenerational issues, health care, health insurance industry, lobbying, media, Medicare, Obama Administration, right wing, Social Security

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Newest Medical Combine: Delis and Hungry Docs

Posted on July 7, 2010 by | 1 Comment

Over the last year or so, there has been a campaign to break the hold of the pharmaceutical companies on doctors. The aim is to get more transparency so as to show the true relations between the drug industry and doctors, which involves taking gift , getting exotic all-expense- paid vacations, signing their names to articles they didn’t write, and on and on. The ultimate goal is to expose and eventually stop these practices.

Among the most fervent of these efforts has been carried out by groups of medical students and doctors who try to stop drug companies from handing out free lunches to busy medical professionals, who are often in hospitals on their short breaks.

Now, the pharma-free lunch movement faces the wrath of the restauarant lobby, which in Massachusetts is said to face a serious loss of business due to the reduction in the numbers of lunches bought by Big Pharma for the docs. Restaurants in Massachusetts want the gift ban ended, according to BNET:

Statehouse Democrats say the ban, which prevents drug sales reps from delivering free sandwiches to doctors, has “severely impacted the profitability” of local businesses. Rep. Brian Dempsey told the Boston Business Journal:… “We’ve been hearing from device and biotech companies, the convention center and the restaurant industry, that this is causing additional problems during the worst recession in memory.

As BNET reports, a pumped up Jeff Norris from Twins Restaurant & Catering in Erie, Pennsylvania, tells EZ Restaurant Marketing, an outfit that counsels restauranteurs how to break into feeding docs:  

“I used to do 2 maybe 3 luncheons per week, and soon I was doing 2 or 3 luncheons PER DAY…Thru June 30th , 2004 I have done 4 TIMES the amount of business with drug reps than I did in ALL of 2003. My marketing is on cruise control. I have some offices REQUIRING drug reps to call me for their luncheons!”

In Los Angeles, for example, Dr. Lunch, an outfit that caters to docs,provides this testimonial from a Dr. Martin Levine: “My staff and I request their lunches repeatedly. We have always enjoyed the food and service provided by DR.LUNCH. The food is not only delicious, but always fresh. I highly recommend them for any event, whether it be your office or home.” 

 BNET further reports:

Some doctors get so used to free lunches that they issue instruction sheets to sales reps, such as this delightfully specific one from a Baltimore doctor obtained by [the blog]Pharmalot: “(Please do not order wraps, several members of the office have not tolerated them well).”

And we’re not just talking sandwiches and chips. Free lunches can be elaborate. Angelo’s of Flemington, NJ, offers Tiger Shrimp sautéed in a pink cream vodka sauce with penne pasta.

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Posted in corporations, drug industry, health care, lobbying

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Drugsters in Academia: How Big Pharma “Educates” American Doctors

Posted on June 28, 2010 by | 4 Comments

 The pharmaceutical industry has wormed its way into the hearts and minds of the medical professions in any number of ways—wining and dining doctors, sending them off to vacation in splendid spas, and even buying their names to put on industry-written articles promoting different drugs.

One little known facet of this drugster-doctor relationship is Big Pharma’s role in continuing medical education (CME) programs, which are important in keeping medical professionals informed and up to date on the fast developing profession. Of the $2 billion-odd spent on these programs every year, nearly half comes from the drug business, which not-so-subtly uses the education programs to push new drugs.

Last week a conference at Georgetown University called “Prescription for Conflict” pulled together experts from academia, government, and industry to discuss the question: Should industry fund continuing medical education? The main instigator here is a former colleague of mine named Adriane Fugh- Berman, a doctor and teacher at Georgetown University Medical School. Fugh-Berman long ago became the nemesis of Big Pharma with a stream of articles and talks questioning the different aspects of liaison between the drugsters and the medical profession. I worked with her helping to set up PharmedOut.org, a website that seeks to educate the public on these liaisons, in part through exposes, both written and on video.

The conference at Georgetown included few critics as candid as Fugh-Berman. Those gathered included polite academics with hedged criticism of industry funding, and regulators like Joshua Sharfstein, principal deputy commissioner at the FDA,  and Julie Taitsman, chief medical officer the Department of Health and Human Services, who presented a list of  the different laws protecting the public. By the time they finished, I was so frustrated with government bureaucrats that I was about ready to join the Tea Party (except that they, of course, would want to do even less to control the greedmeisters at Big Pharma).

One blunt critique came from Paul Thacker, an investigator for Senate Republican Charles Grassley, who has been the most visible Congressional muckraker on the doctor-drug company love-in. Thacker bluntly told the docs to get off their supercilious “who me?’’ attitude and come to grips with the scarcely believable conflicts of interest existing between the medical profession and the drug industry–conflicts that more often than not have been to the detriment of their patients.

The industry, as always, insists it isn’t doing anything bad–far from it. Big Pharma, its representatives would have you believe, is really performing a public service, trying to educate docs so they can do a better job. This conference, however, offered a different point of view, in the statement of an anonymous “pharmaceutical executive,’’ who admitted industry involvement in “CME has the potential for inappropriate promotional messaging and influence.’’ 

The anonymous exec went on to state:  “Typically,companies make CME investment decisions at annual budget meetings.  The Sales and Marketing divisions dominate deliberations.and distribution of CME cash.’’ In deciding what institutions are to get money, he continued, “large volume, influential institutions are not likely to be rejected…Friendly institutions, as defined by access and volume, are more likely to receive grants than those that favor another company’s products. Grants may also be made in support of programs including particular KOLs [key opiniong leaders] whose opinions resonate with the promotional plan…Similarly, those known for positions antithetical to the company’s promotional plan are less likely to be supported.’’

In conclusion, the exec said, “CME contributions are commercial decisions,’’ and, finally, “CME is not compatible with commercial intervention.’’ Too bad it takes a drug company whistleblower to make this statement of the obvious, rather than the medical organizations and government regulatory agencies who are supposed to be looking out for us.

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Posted in Congressional Republicans, corporations, drug industry, health care, legal issues, lobbying

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Reverse Mortgage Reality Check

Posted on June 14, 2010 by | Leave a comment

As Congress debates its tepid “reforms” of the financial industry, Wall Street has invaded Capitol Hill in what CNN described as a “lobbyists swarm.” What I know about the legislation gives me absolutely no confidence that it will make the market a safe place to put my retirement savings–or what’s left of them, after the recession. Seniors have already suffered most from the 401K long con, and the thought of getting anywhere near Wall Street makes me sick to my stomach.

Given how much money many elders have lost, I suspect those of us lucky enough to own homes that aren’t already mortgaged to the hilt are thinking about a “reverse mortgage” as a means toward future security. I know I’m seeing more and more ads where smiling oldsters talk about how their reverse mortgage took a load off their minds. This, of course, makes me highly suspicious; it all sounds too much like yet another con, replete with hidden fees and rip-offs, just like everything else the banking industry has come up with.

Fortunately, Saul Friedman recently wrote a comprehensive report on reverse mortgages. A former reporter for the Detroit Free Press, Friedman writes the ”Gray Matters” column that used to run in Newsday and now appears on the excellent blog about aging called Time Goes By. Friedman, whose judgement I trust completely, has a reverse mortgage himself; he has investigated the hidden pitfalls of this type of financing, and also knows that it matter what kind of reverse mortgage you get.

For anyone even considering this move in their financial futures, Friedman’s article on reverse mortgages is most definitely worth reading.

So here’s some welcome news for older Americans who own their homes and can use some extra income and cash. The up-front costs for many FHA-guaranteed reverse mortgages have gone down, which means the possible proceeds will go up by as much as $10,000.

I’m referring to the most popular and safest reverse mortgage, the Home Equity Conversion Mortgage, fondly known as the HECM. It is the safest for the lender as well as the homeowner-borrower because it is backed, insured by the Federal Housing Administration which has never defaulted on a mortgage that it has guaranteed.

Indeed, of all the mortgages that have fallen on hard times, or have been the subject of scandalous behavior by bankers and investors, the HECM has been largely untouched by these troubles. Last year, the Department of Housing and Urban Development raised to $625,000 the value of a home that could qualify for a HECM.

There’s much, much more to Friedman’s piece, which needs to be read in full. But here’s his summing up:

All in all, then, HECMs are a good deal if you intend to remain in your home for at least five years; otherwise you’ll be saddled with the closing costs that will eat up the proceeds you get.

To sum up HUD’s guide to HECMs:

  • You must occupy your home (condo, or co-op) as your principal residence
  • There are no income, credit or health requirements
  • Social Security and Medicare benefits are not affected
  • You keep title and may sell it at any time
  • You may use HECM proceeds to buy a second, vacation home as long as the loan on the first home is paid
  • And of course, no repayments as long as you occupy the home.

Still it would be wise to shop for a provider who may be able to arrange the loan and lead you through the process. HUD requires that each borrower undergo counseling by an approved agency (cost is $125). The counseling of the National Council on Aging, is even better and free. Call 800-510-0301.

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Posted in Congress, economy, financial crisis / recession, lobbying, pensions / retirement funds, Wall Street / financial industry

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The U.S. Government, Brought to You By Big Oil

Posted on June 4, 2010 by | Leave a comment

Long may she wave: The flag of the United States of Oil

Oil companies have begun to “weigh strategies to fight off tougher regulations” in the wake of BP’s spill to end all spills, the New York Times reported earlier this week. Supposedly, the companies are nervous because of President Obama’s angry takedown of the oil industry last week, as well as rumblings in Congress, where there are now efforts “to extend bans on new offshore drilling, strengthen safety and environmental safeguards and raise to $10 billion or more the cap on civil liability for an oil producer in a spill.”

Frankly, I don’t buy it. I’m quite willing to believe, as the Times story says, that the petroleum industry’s lobbyists have kicked into high gear. But I can’t believe the companies are really all that worried. Ever since John D. Rockefeller founded Standard Oil in 1870, the federal government has pretty much given the oil men exactly what they wanted, when and where they wanted it–from oil depletion allowances to tariff protection to cheap leases on the federal public domain (which includes the outer-continental shelf in the Gulf of Mexico, site of the Deepwater Horizon disaster). Periodic government attempts to contain or regulate the industry have been little more than temporary annoyances, rather than major obstacles to Big Oil’s power or profits. This is hardly surprising, considering the kind of influence the oil companies wield at all levels of the U.S. government.

In 1911, for example, the U. S. Supreme Court found that Standard Oil, which was then controlling 85 percent of the industry, had violated anti-trust laws and conspired against the public good. “For the safety of the Republic,” the Court declared, “we now decree that this dangerous conspiracy must be ended” within six months. Standard Oil was broken up into a few dozen closely related smaller companies–the only result being that the nation’s energy lifeline was controlled by a cartel instead of a monopoly.

Another serious stab at regulation began in 1938 with the passage of the Natural Gas Act, which again tried to combat monopolistic pricing by giving the Federal Power Commission (predecessor to Federal Energy Regulatory Commission) the authority to set “just and reasonable rates” for the transmission or sale of natural gas in interstate commerce. In 1954, in the Phillips decision, the Supreme Court held that the federal government should also regulate the price of natural gas at the wellhead–that is, at the point where the gas comes out of the ground. For the better part of a decade, the government fiddled around doing nothing, but then in the early Kennedy administration, the FPC came up with an area pricing plan. Although the focus here was on gas, everyone knew it was a warning shot at the oil industry, which owned and controlled most of the natural gas. To price gas, it would be necessary to get at the oil industry internal documents, revealing such things as the amounts of reserves, costs, and the like.

Immediately, the big oil and gas companies warned we would run out of gas if prices were not raised to stimulate greater production. In 1974, during the (largely manufactured) energy ”crisis,” the FPC took the first steps to undercut its own proposed regulations by giving in to industry and hiking prices. Under Jimmy Carter, the government began the formal process of deregulating gas, a policy which carried forward under Reagan and both Bush’s as part of the Republican right wing’s drive against regulation. Once the government gave in, the gas shortage disappeared and today we are supposedly awash with gas. All this was accomplished by industry manipulation of production and reserve figures—the same thing that has happened during all oil “shortages.”

In the wake of the BP disaster, it’s become abundantly clear that the oil industry itself has been writing the rules for offshore drilling, and not federal regulators at the Interior Department’s Minerals Management Service. “Nearly 100 industry standards set by the American Petroleum Industry are included in the nation’s offshore operating regulations,” McClatchy reported last month. “The API asserts that its standards are better for the industry’s bottom line and make it easier to operate offshore than if the Minerals Management Service set the rules.”  

The Washington Post reported on Thursday that the MMS approved “categorical exclusions’’ from environmental review for BP’s offshore wells in the Gulf, including the Deepwater Horizon. Congressional probes already suggest Minerals Management worked in collusion with BP and other oil firms to increase offshore production without regard to safety or environmental standards. Over the last month, the litany of MMS’s failures, and its more than “cozy” relationship with the oil industry, has been extensively documented by the press (including MJ’s Kate Sheppard, here and here).  With government oversight of this caliber, we ought to stop wondering how a disaster like the Deepwater Horizon spill could happen, and start wondering where it’s going to happen next.

Failure to devise any sort of meaningful regulation of the oil and gas business means that we really don’t know what the industry does, or where or how. Information on the country’s reserves are left in the hands of the companies, not the federal government. Since the US Geological Survey, which is supposed to map the public domain never had the money to do the job right, large parts of the public lands have not been thoroughly mapped by anyone but the companies that exploit it. Relying on industry data has resulted time after time in false information–as in the case of gas in the 1970s energy crisis–to inflate or deflate the amounts of oil and gas reserves.

Beyond failing at its own oversight function, the workings of the MMS also make it difficult for independent analysts to assess what is really going on. Earlier this week, a coalition of scientific societies underlined the problems in a letter to Interior Secretary Ken Salazar:  

Without a transparent and ethical process for dealing with scientific research and scientific conduct, the science that is performed at DOI may be called into question. This will not only harm the reputation of DOI, but will threaten the conservation of the nation’s treasured natural resources.  To ensure that science is being used properly to implement natural resource decisions, science should not be suppressed, scientific misconduct should be punished, and scientists who report suppression or other scientific misconduct should be afforded whistleblower protections.  Additionally, the science that informs natural resource decisions must be clear, transparent, and subject to independent peer review.

Such changes are unlikely to be implemented even in the wake of the BP spill. The secrecy surrounding federal energy policy was underscored by the confidential meetings organized by Dick Cheney with the oil and gas industry, as part of the Vice President’s ”task force” to design a new national energy policy in the early years of the Bush Administration. Those meetings, the details of which remain hidden from the public—their confidentiality supported by the courts—are the most glaring recent example of energy policy formed in secret, and in collusion with the energy industry. In other words, in America, the oil companies not only write their own regulations and perform their own oversight; they also set energy policy and draft laws.

In addition to having their way with the executive and legislative branches of government, the oil companies have largely triumphed over the judicial system as well. Government policy plays into oil company interests not only by letting them do as they please, but also in limiting their liability when things inevitably go wrong. On “Meet the Press” last Sunday, White House energy advisor (and former Clinton EPA head) Carol Browner repeated the pledge that BP would pay all cleanup costs for the spill. This is true, as far as it goes, and BP too has promised to pay for the cleanup. But you can just see lawyers haggling in court over what constitutes a cleanup cost.

In addition to the outright cleanup costs, BP also  faces cost of  up to a total of  $75 million for damages not associated with the oil spill itself—such things as fishing and tourism. That amount would be woefully insufficient in this case. Finally, some of the $1.6 billion stashed in Oil Spill Liability Trust Fund could be spent in a cleanup. This fund is made up of industry taxes of 8 cents per barrel, and there is a cap of $1 billion on how much of that can be withdrawn. The House  recently undertook efforts to raise the cap and increase the industry taxes going into  the Oil Spill Liability Trust Fund. But since this Trust Fund is created by taxing oil, you can be sure that one way or another, the cost will be passed on to consumers, rather than coming out of oil company profits.  

Finally, the Supreme Court could decide to give a special parting gift to BP, as they did to Exxon following the Valdez spill. In that case, an Anchorage jury brought in a verdict of $5 billion in punitive damages against Exxon. In 2008, after nearly two decades of litigation, the Supreme Court reduced the damages to $500 million–a tenth of the original verdict. The decision, written by Justice Souter, cited ”the need to protect against the possibility…of awards that are unpredictable and unnecessary, either for deterrence or for measured retribution.” It’s hard to believe five Supreme Court Justices believed that $5 billion wouldn’t be a more effective “deterrent” to future negligence than $500 million. But apparently, the highest court in the land wanted to make sure that a jury of citizens didn’t go overboard in demanding responsible behavior from America’s favorite industry.

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Posted in Bush Administration, Congress, corporations, economy, environment, legal issues, lobbying, media, Obama Administration, public safety

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Obama’s “Revelations” and the Oil Industry’s Slimy History

Posted on June 1, 2010 by | 1 Comment

“What’s been made clear from this disaster is that for years the oil and gas industry has leveraged such power that they have effectively been allowed to regulate themselves,” President Obama said last week in his press conference on the BP oil spill. “I was wrong,” he declared,  “in my belief that the oil companies had their act together when it came to worst-case scenarios.”

Ya think? If this isn’t a textbook example of closing the barn door after the horse is out, I don’t know what is. In fact, it isn’t even closing the door so much as acknowledging that the barn actually has a door, which we might want to consider using once in a while if we don’t want the horses running wild. What the President’s statement reminds me of most is Alan Greenspan’s admission, after the economic meltdown took place, that there just might be a tiny ”flaw” in his approach to financial regulation. “I made a mistake,” Greenspan told Congress in October 2008, “in presuming that the self-interests of organizations, specifically banks and others, were such that they were best capable of protecting their own shareholders and their equity in the firms.”

In the aftermath of his press conference, political pundits seem to be focused on whether Obama–and by implication the federal government–was taking too much responsibility for the spill, or not enough. Only a few have pointed out the patent absurdity of believing in the first place that the oil companies could be trusted to “have their act together” when it came to either preventing or dealing with massive spills. The history of global oil spills over the last half-century shows a pattern of carelessness and ineptitude on the part of the industry–and of failure on the part of governments who tried to intervene after the fact.

When the tanker Torrey Canyon drove straight into the rocks off Land’s End in Britain in 1967, spilling its 31-million-gallon cargo, chemical dispersants were spread on the expanding slick with no result. According to the “Report to the Committee of Scientists on the Scientific and Technological Aspects of the Torrey Canyon Disaster,” the British Air Force was called in to set the oil afire by bombing it. Some of it eventually caught fire; most of it did not. A Dutch salvage team  thought they could fix things by pulling the ship off the rocks, but the tow cable broke. The spill ended up killing marine life and spreading glop all over the beaches of Southern England and some in France as well.

In 1969, a well on the outercontinental shelf six miles off Santa Barbara, California, went out of control. All initial efforts to control the spilling oil were as futile. When the flow was finally stopped after 11 days, 3 million gallons had escaped and coated the pristine beaches of Santa Barbara channel. (At the time it was considered a devastating disaster, and helped fuel the fledgling environmental movement in California–though the numbers sound almost quaint compared with the current BP spill.) After the Santa Barbara spill, the U.S. government came up with a plan to keep teams of experts from different parts of government on standby, so they could fly in and assess damage in the event of a spill.

In 1969 alone, the Coast Guard was reporting 1,007 oil spills in U.S. coastal waters. Many others were not reported. (It was standard practice for ships to pump waste oil into the water on approaching port.) That same year, a Woods Hole Oceangraphic research project in the Sargasso Sea, reported “quantities of oil-tar lumps up to 3 inches in diameter were caught in the nets…It was estimated that there was three times as much tar-like material as Sargasso weed. Similar occurrences have been reported worldwide by observers from this as well as other institutions.’’

In 1970 an Onassis tanker called the Arrow hit Cerberus Rock off Nova Scotia.  It was the Torrey Canyon all over again. Detergents were sprayed with no effect. The U.S. Army dispatched teams armed with  flame throwers to burn it up, which didn’t work. Chemists from Pittsburgh Corning Glass arrived with bags of little glass balls intended to act as wicks for burning the oil, but these did not ignite. Fiberglass collars set up to keep the spreading oil out of a fish processing plant also failed. Attempts to pull the ship off the rocks were futile. Eventually a gale broke the tanker’s back and the stern sank in one hundred feet of water with one million gallons of congealed crude oil aboard. In this case, by pure luck, the remaining oil stayed inside the tanker until a salvage team pumped it out a few months later.

In 1979, Pemex’s Ixtac oil well, in the Gulf off of Campeche, Mexico, suffered a blowout. Through various measures–some of them similar to those currently being used on the Deepwater Horizon spill–the flow of oil from the blown well was slowed from 30,000 to 10,000 barrels a day, but it took nearly ten months for it to be stopped completely. By that time, an estimated 3 million barrels had reached the U.S. Gulf coast. 

The 1970s through the 1990s saw more than a dozen spills larger than the Exxon Valdez, pouring oil into the waters off Trinidad, Uzbekistan, Iran, Angola, South Africa, France, Italy, Greece, Spain, Portugal, Turkey, Ireland, Scotland, Wales, Mozambique, Chile, and Sweden.

As for the Valdez disaster itself, its effects still linger nearly two decades after the 1989 spill. During that time, suits against Exxon made their way through courts, resulting in a $5.5 billion jury trial settlement. But the Supreme Court later thought this was too much money, and cut the settlement to $1 billion. No fine ever levied against the oil industry has seriously inhibited its ability to keep doing business as usual–or employing lobbyists, or making campaign contributions. And to my knowledge, no oil company executives have ever gone to jail for the environmental devastation caused by their negligence or greed.

This, perhaps, is the real lesson of history when it comes to oil spills: It isn’t enough, even, to close the barn door, if you allow the horses to keep making hay.

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Posted in Congress, corporations, financial crisis / recession, international, legal issues, lobbying, media, Obama Administration, public safety, Wall Street / financial industry

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I Was Not a Victim of Age Discrimination at Work (Not)

Posted on May 5, 2010 by | 2 Comments

When I was fired by the new owners of the Village Voice in 2006, after working there for 30 years, it had nothing to do with age discrimination. At least, that’s what the official documents say.  

For a number of reasons, I initially suspected that age had something to do with it. But I must have been wrong, because I later signed an agreement saying I had not been discriminated against on the basis of age. The document also happened to say that I would get some severance benefits I really needed, being 69 years old and suddenly jobless–but I’m sure that didn’t affect my decision to sign it.  

I have no doubt that the following scenario is experienced by thousands of older Americans who lose their jobs (though not, as I’ve mentioned, to me). They are pretty sure they know what is going on, and why. They discuss it with their attorneys, who are sympathetic but explain how difficult it is to prevail in such cases. The lawyers also tell them that the case could drag on for years–implying, though they don’t like to say so, that the geezers could be dead before it is resolved. So the geezers tell their lawyers to negotiate the best deal they can, and sign whatever they need to sign in order to get that deal. Or so I’ve heard. 

Age discrimination in the workplace (somethat that I, as I’ve said, did not experience), has always been notoriously difficult to prove to the satisfaction of the American justice system. But last June, the Supreme Court made it all the more difficult with its 5-4 ruling in Gross v. FBL Financial Services, Inc. The Court held that for workers to sue under the Age Discimination in Employment Act of 1967, they must prove that the employer would not have taken a particular action “but for” the person’s age. This sets age discrimination apart from all other forms of discrimination in the eyes of the law. As the New York Times put it in an editorial criticizing the Court’s decision:   

When employers discriminate, they generally do not admit it, so Congress and the courts have established calibrated rules of proof to give victims a fair chance. Generally, if workers can show that an illegal consideration, like race or national origin, was a factor in their being fired or demoted, the employer then has the burden of showing that it acted for nondiscriminatory reasons.  

That should be the rule under the Age Discrimination in Employment Act of 1967, but the Supreme Court, by a 5-to-4 vote, decided that it is not. Older workers, Justice Clarence Thomas declared for the majority, have the full burden of proving that they were fired because of their age. That is an unfairly difficult standard, and it is an unreasonable interpretation of the law.  

Last fall, the Democratic chairs of three key Congressional committees introduced legislation that would ”restore vital civil rights protections for older workers in the face of the Supreme Court’s decision in Gross v. FBL Financial.”  In announcing the bill, called the ”Protecting Older Workers Against Discrimination Act” (H.R. 3721), the sponsors stated: ”In Gross, the Supreme Court rewrote civil rights laws, overturning well-established precedent and making it harder for workers facing age discrimination to enforce their rights.”   

Today, the Health, Employment, Labor, and Pensions (HELP) Subcommittee of the House Committee on Education and Labor held its first hearing on the Court’s ruling and the proposed legislation. As the Legal Times blog reports:  

The AARP is supporting the legislation, and Gail Aldrick, vice chair of the group’s board, also testified today. Those registered to lobby on the bill include the National Association of Manufacturers and the U.S. Chamber of Commerce.    

Eric Dreiband, partner in a firm that does corporate defense work, testified in opposition to the bill, calling it a “broad and ambigous” measure that would “enable some lawyers to earn more money” but probably wouldn’t help older workers all that much. 

But Michael Foreman, who directs the Civil Rights Appellate Clinic at Penn State’s law school, called the proposed legislation a “fair, balanced, indeed conservative attempt to return the law to where everyone, the courts included, thought it was” before the Gross decision.  

The final testimony came from Jack Gross, plaintiff in the case that bears his name. At the age of 54, Gross was demoted by his employer, FBL–along with a group of other employees over 50 who refused to accept buyouts. He initially won his lawsuit against FBL, but it was appealed up to the Supreme Court, which decided against him. Gross told the Committee: “I hate having my name associated with the pain and injustice now being inflicted on older workers.” 

In the unlikely event that Democrats succeed in quickly passing the new law, it won’t come a moment too soon. According to the Equal Employment Opportunity Commission, the recession has been terrible for older workers, who to all appearances have suffered more than their fair share of layoffs. In 2008, the EEOC saw a 30 percent increase in the filing of age discrimination charges, which outpaced all other types of bias claims. The numbers were so dramatic that the acting chair of the EEOC wondered whether “the public generally realizes that age discrimination is illegal.” 

It seems to me that even if they do know it’s illegal, much of the public–like the courts–don’t seem to take age discrimination too seriously.

But of course, I really wouldn’t know.

  

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Posted in age discrimination, Congress, Congressional Democrats, financial crisis / recession, jobs / employment / unemployment, legal issues, lobbying, Obama Administration, older workers

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