Sep 7th, 2010 at 3:30 pm by susie
I previously posted a story about this little boy, whose insurance company stopped paying for his neuroblastoma treatment. Fortunately for his family, Children’s Hospital decided to treat him anyway and worry about payment later.
Kyle died yesterday and his family is grateful for every day they had.
Obviously, not enough people do. But it looks like it might be good for you!
Sep 7th, 2010 at 2:25 pm by susie
“All my life I’ve heard Latin America described as a failed society (or collection of failed societies) because of its grotesque maldistribution of wealth. Peasants in rags beg for food outside the high walls of opulent villas, and so on. But according to the Central Intelligence Agency (whose patriotism I hesitate to question), income distribution in the United States is more unequal than in Guyana, Nicaragua, and Venezuela, and roughly on par with Uruguay, Argentina, and Ecuador. Income inequality is actually declining in Latin America even as it continues to increase in the United States.Economically speaking, the richest nation on earth is starting to resemble a banana republic. The main difference is that the United States is big enough to maintain geographic distance between the villa-dweller and the beggar.“
Not in the big city, it isn’t. I already see crime escalating and bleeding over into the expensive neighborhoods. After all, as Wilie Sutton said, “It’s where the money is.”
Sep 7th, 2010 at 12:35 pm by susie
The potential upside to this depression is that middle-class people (not the elite classes, but most people) are being stripped bare of the illusion that they belong to some happy meritocracy, and that the problems of the lower classes are simply the result of their own bad choices — or worse, bad characters.
Because if that were true, how do they explain why their own suburban manses aren’t worth what they owe? Or why the owners lost their jobs, can’t find another and can no longer define themselves as “good providers”? It’s a lot harder to convince yourself you’re superior when you made all the right “choices” and got screwed, anyway.
There were specific economic strategies on the national and international levels that led us into this mess. Not coincidentally, there was also some kind of mass hypnosis that convinced most people it was sane to use their illusory home equity as an ATM machine.
I don’t blame people for believing that. But they should take a close look at the personal values that encouraged them to do so. Because we’re all connected, and we shouldn’t waste time on the things that promote the illusion of separation.
Continue Reading »
Sep 7th, 2010 at 11:21 am by susie
Ezra Klein on why raising the retirement age is really a benefits cut:
There are two retirement ages in Social Security: The first is the age at which you’re eligible to begin receiving benefits — albeit in reduced form. Right now, that’s 62, and that’s also when most people start the clock. The second is the “full retirement age,” which is the age to retire if you want full annual benefits, or at least what Social Security considers to be full benefits. That’s currently 66. When we talk about “raising the retirement age,” we aren’t talking about raising the age at which you can begin receiving Social Security. We’re talking about raising the age at which you can claim full benefits. Hence, “raising the retirement age” doesn’t mean people can’t retire and collect Social Security at age 62 — it just means they get less if they do.
In other words, this is a benefits cut. Social Security pays you a certain amount of money until you die. The longer you live, the more you get. Cutting a year off that estimated payout — which also means that Social Security rewrites the formula for taking early benefits to make sure people retiring early also get less money — means less Social Security in total. As Brookings’s Henry Aaron explains, it’s “simply an across-the-board benefit cut—roughly 6.66 percent for each year the ‘normal’ retirement age is increased. Thus, raising the’ full benefits’ age by, say, three years is nothing more or less than an across the board benefit cut of 20 percent.”
So why don’t we call it a benefits cut? Well, cutting benefits is really unpopular. “Raising the retirement age” is also really unpopular, but it at least sounds a bit better and gets the conversation focused on the longevity of Americans rather than the generosity of Social Security and the adequacy of most people’s retirement savings. But that’s just confusing people: If we want to have a conversation about encouraging people to work later into life, we can have that conversation, but it includes things beyond Social Security (like measures to deal with age discrimination). If we’re just talking about cutting benefits, however, we should have that conversation honestly.
That’s exactly right. The administration is doing everything it can to encourage people to believe that “people are living longer” and therefore it’s “only fair” to raise the retirement age.
But “people” aren’t living longer: Upper-class white people are living longer. You know, the ones who have the money for great medical care? The ones who aren’t sitting, worrying about money?
Ezra nails it. This is a dishonest conversation.
Bottoming out. Welcome to the Workers Paradise!
In my neighborhood, the factories have been turned into designer lofts that no one can afford to buy, rent or heat. Progress!
Ezra’s right, of course. Encouraging the manufacturing base to erode was another bright idea we can lay at the feet of the elite. But since none of the elite knows the kind of people who actually worked in factories, it didn’t seem all that important at the time. We were entering the Brave New World of the service economy.
Which is why it keeps coming back to the same thing: Class. There’s the bubble of the elite, and then there’s everyone else.
Sep 7th, 2010 at 9:51 am by susie
They put all their chips on black, and it kept coming up red. Maybe they should have made banks mark mortgages at their true value? But that would have made the bankers cry, so it was never a real option.
They might have made the HAMP program work instead of using it as PR cover, too. But oh well!
Over the last 18 months, the administration has rolled out just about every program it could think of to prop up the ailing housing market, using tax credits, mortgage modification programs, low interest rates, government-backed loans and other assistance intended to keep values up and delinquent borrowers out of foreclosure. The goal was to stabilize the market until a resurgent economy created new households that demanded places to live.
As the economy again sputters and potential buyers flee — July housing sales sank 26 percent from July 2009 — there is a growing sense of exhaustion with government intervention. Some economists and analysts are now urging a dose of shock therapy that would greatly shift the benefits to future homeowners: Let the housing market crash.
When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve.
“Housing needs to go back to reasonable levels,” said Anthony B. Sanders, a professor of real estate finance at George Mason University. “If we keep trying to stimulate the market, that’s the definition of insanity.”
The further the market descends, however, the more miserable one group — important both politically and economically — will be: the tens of millions of homeowners who have already seen their home values drop an average of 30 percent.
The poorer these owners feel, the less likely they will indulge in the sort of consumer spending the economy needs to recover. If they see an identical house down the street going for half what they owe, the temptation to default might be irresistible. That could make the market’s current malaise seem minor.
Caught in the middle is an administration that gambled on a recovery that is not happening.
“The administration made a bet that a rising economy would solve the housing problem and now they are out of chips,” said Howard Glaser, a former Clinton administration housing official with close ties to policy makers in the administration. “They are deeply worried and don’t really know what to do.”
Go read the whole thing, about the crisis of their own making. Pouring money down a hole is almost never a good strategy.
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