Coyote Blog

Frequent readers know I almost never call statements "a lie."  I try to take the position that reasonable people can disagree without either lying.  I hate all the "Lying liars and the lies they tell their lying supporters" type books.

But I simply can find no other way to explain this statement:

"There isn't anything we could do to satisfy them in this health care bill. Nothing," Senate Majority Leader Harry Reid (D-Nev.) said. "They are so anti-competitive. Why? Because they make more money than any other business in America today. . . .What a sweet deal they have."

I have written about this any number of times, but Carpe Diem also has the numbers at the link - health care insurers are well below average both in profit margin and return on capital, the two most common measures of profitability.  For the last couple of years, most large health care companies have made less than 5% return on sales.

The only other explanation is the neither the House Majority Leader, his staff, President Obama, or Nancy Pelosi and her staff (all of whom have echoed this same meme) have never once spent the 12 seconds going to Google finance or the Wall Street Journal to look the number up.

Nancy Pelosi once said:

I'm very pleased that our Chair of our Democratic Congressional Campaign Committee and member of the leadership will be talking too about the immoral profits being made by the insurance industry and how those profits have increased in the Bush years. We all believe in the profit motive; we all want to reward success.  But having that success come at the expense of America's working families "” have that success come by withholding care, when a person becomes ill, is just not right and we're going to take this issue in a new direction.

Liberal pundit Kevin Drum, who really should know enough to look it up, once said:

It means the health insurance industry is scared that we might actually do something in 2009 and they want to be seen as something other than completely obstructionist. That means only one thing: they've shown fear, and now it's time to bore in for the kill and gut them like trouts. Let's get to it.

House Majority Leader laughs at the idea legislators would actually read the bills they vote on:

House Majority Leader Steny Hoyer (D-Md.) said Tuesday that the health-care reform bill now pending in Congress would garner very few votes if lawmakers actually had to read the entire bill before voting on it.

"If every member pledged to not vote for it if they hadn't read it in its entirety, I think we would have very few votes," Hoyer told CNSNews.com at his regular weekly news conference.

Hoyer was responding to a question from CNSNews.com on whether he supported a pledge that asks members of the Congress to read the entire bill before voting on it and also make the full text of the bill available to the public for 72 hours before a vote.

In fact, Hoyer found the idea of the pledge humorous, laughing as he responded to the question. "I'm laughing because a) I don't know how long this bill is going to be, but it's going to be a very long bill," he said.

So much of government regulation boils down to the protection of politically connected incumbent competitors against new competition.  This is an astonishing example, sent in by a reader:

BEMIDJI, Minn. - Assistant House Majority Leader Frank Moe says people
who rent out their lakefront homes may be hurting the state's resort
industry.

The Bemidji DFLer has authored a bill ordering the
state's tourism agency to study whether the increased competition is
hurting resorts. It's now awaiting Governor Tim Pawlenty's signature.

If you are willing to make up your own bed, there are a lot of reasons why private home rentals are a more attractive vacation option than resorts, particularly when you consider the high price of those ancillary resort services.  Why the government needs to be involved in what is, to my eyes, just a normal consumer preference is beyond me.  This last line caught my eye:

The state's resort industry is struggling as lakefront property values
soar but the market restricts what they can charge for cabin rentals.

Uh, OK.  I have the same problem -- land for cabins and campgrounds in areas people want to spend the weekend is really expensive, labor costs are up, but rental rates remain low.  So what?  Through their preferences and how they translate to prices, consumers are saying that there is better uses for prime land than lakefront rental cabins.  I can accept that.

The Colorado faculty is going apeshit because the state has proposed making Bruce Benson, a Colorado oilman-Republican, who *gasp* only has a paltry BA degree, head of the University of Colorado system.  To a large extent, folks are going nuts largely because he has different politics than 97% of the faculty and because he has actually done something productive in his life.  However, not being able to say this out loud  (we're a government body so we are not supposed to have political tests, wink wink) his lack of an advanced degree has become the centerpiece of the opposition.

State House Majority Leader Alice Madden, a Democrat and CU law school
graduate, declared that Benson would be "the least educated president
ever considered in modern history."

Apparently, his academic record does not live up to University of Colorado standards, which has gleefully employed academic titans like Ward Churchill.  (By the way, isn't it interesting that these folks respect a couple of years at the age of 23 getting a masters in petroleum engineering more than 50 years of demonstrated excellence actually practicing petroleum engineering.)

But here is my advice to Mr. Benson:  Don't take the job.  Mr. Benson, in the private sector, you were probably used to having employees who didn't like you or think you were the best person for your job.  However, you knew that they could either be persuaded by demonstrated performance over time, or else you at least knew that people would work for your goals despite their dislike for you, since they knew that their success lay in the success of the organization as a whole.

University faculty do not behave this way.  They have a completely different set of incentives.  With a job for life, and knowing that no matter how bad the university gets, it will still get state support, they have absolutely no incentive to pull together for the good of the institution or, even less likely, for the well-being of the student body.  There are many exceptions to this; in fact, the exceptions may number more than 50% of the faculty.  But these exceptions do not drive faculty behavior.  Those that drive faculty behavior are the ones that are out for either self-aggrandizement or the promotions of symbols over performance or both. 

There once was a dean at Princeton University I liked and respected named Neil Rudenstine (actually he was Provost when I was there, but who the hell knows what a Provost is?).   Rudenstine was named President of Harvard, and was a good fundraiser (like Benson) and was very hands-off in his management style (as Benson promises to be).  Neil was a good man, but he was broken by the Harvard faculty, driven to what probably was literally a mental breakdown.  And then there was Larry Somers.  He was a very different type of man than Rudenstine -- tougher, more politically experienced.  But he too was broken by the Harvard faculty in an attempt to move that institution perhaps 1% of the way towards where you probably want to move Colorado. 

Don't do it.