Obamacare at age 1

Here is a tweet summarizing some high-level numbers of Obamacare at the end of its first year. 10+ million people who have insurance now, who previously did not have insurance. Premiums increased only 2% this year, which is a low rate of growth compared to most years. Medical debt is down. And 0 death panels! 

While this is a very good start for the program, we need to wait a few more years to understand the full effect regarding both benefits and costs. 

Finally, behind these high level numbers are actual Americans whose lives have been transformed by having access to health insurance. Click here to read these stories. 

Happy new year and wish everyone great health in 2015! And if bad health does arrive, wishing you do not have to navigate the American health system without health insurance. 

America's dysfunctional relationship with its military

"A man who worked for decades overseeing Pentagon contracts told me this past summer, 'the system is based on lies and self-interest, purely toward the end of keeping money moving." What keeps the system running he said, 'was that services get their budget, the contractors get their deals, the congressman get jobs in their districts, and no one who is not part of the deal bothers to find out what is going on..."

"The American public and its political leadership will do anything for the military except take it seriously. The result is a chickenhawk nation in which careless spending and strategic folly combine to lure American into endless wars it cant win..."

An excellent, must-read article about our dysfunctional relationship with our military.  Fewer and fewer Americans have any personal connection to the military, which makes it easier for us to express generic platitudes without seriously considering the important questions around military inefficiency, corruption, war, torture, and how we support our troops during and after their service.  

Serial podcast

This American Life is trying a new podcast model - a weekly serial program. This year, the producer (and also lead investigator and narrator) Sarah Koenig decided to re-investigate a murder that occurred near Baltimore in 1999. 

So how did Serial do? IT BLEW UP! Nearly 40 million downloads of the entire first season (3.4 million per episode) making it the most downloaded podcast of all time. Definitely the content itself helped: Serial re-investigates an absolutely perplexing murder with tremendous detail and depth. Further, the week to week medium propagates a real-life mystery and engenders discussion, which builds momentum for the podcast. Given the right topic, I think this weekly podcast model can be incredible successful. 

You can download all 12 episodes of the podcast here. 

Spoiler alert. Stop reading if you havent listened to the entire podcast...

In addition to the sheer entertainment value, I think this podcast also introduced many people to how capricious and unjust our criminal justice system can be. Most people, including myself and my wife, feel that Adnan may be guilty but that there is absolutely no way he could be convicted beyond a reasonable doubt. Things we know with regard to the capriciousness and unfairness of the process in this case:

+ The police detectives very quickly honed in on one suspect at the expense of a thorough investigation 
+ The main evidence for the prosecution was the testimony of one individual, Jay. Jay changed his story several times. His testimony changes between the various police interrogations and continues to change across the first and second trials in significant ways. 
+ His initial account match very poorly with cell phone records and cell phone tower pings. His testimony changes slowly every time until it closely matches the cell phone records and tower pings in the second trial. There is evidence that police investigators coached him to change his story to better match those records. 
+ Now 15 years later he basically says he perjured himself (though he is still sticking with his overall story that Adnan was the killer). 
+ The prosecution yelled at Don (HML's boyfriend at the time of her death) for not presenting Adnan in a negative light during his testimony. 
+ The prosecution secured a very shady plea deal with Jay (Jay served zero time for his role in burying HML in exchange for testimony against Adnan) and provided him with a lawyer, which is unethical
+ Adnan was likely winning his first trial but then his lawyer got into a fight with the judge over something fairly trivial, leading to a mistrial. 
+ Though highly regarded, Adnan's lawyer made many mistakes and it was revealed that she was suffering from from a debilitating illness that lead to her death a few years later.  
+ The prosecution introduced false stereotyping of Muslims that tainted the jury's views of the case. 

The right direction (part II)

In my previous post, I discussed how two-thirds of Americans feel that the country is headed in the wrong direction despite overwhelming positive economic trends. Here I'd like to discuss reasons for this pessimism. 

1) The economic numbers may be good but people dont feel it in their incomes. Real median wages have been flat for several decades. That is an alarming statistic! A large fraction of the country is no better off than they were in the late 90s in terms of real income and that is genuine cause for pessimism. The one question I have is why people were more optimistic through the 2000s when this was also true?

2) People are more pessimistic about external threats like ISIS, Ebola, North Korea, Russia etc. I suppose this is possible (the polls I have seen do not follow up and ask people why they are pessimistic about the direction of the country). This view is misinformed in my view. Ebola is not a real threat to Americans, neither is ISIS nor North Korea in my view, and the Russian economy is self-destructing as I write. And external chaos always exists - is it particularly worse now? 

3) Social changes are scaring people. Many people may be scared of the social transformations happening in this country such as gay marriage, the legalization of marijuana, a black president, changing demographics, etc. Outside of stagnant wages, this is the explanation I find most compelling. For a great swathe of America, especially white America, there have been changes to society that are too quick, too soon and you can see this rhetoric, especially over the right wing media (tv, radio, print).   

The right direction (part 1)

In the recent November, 2014 midterm elections, 67% of Americans answered that the country was on the wrong track. My response to that poll: if this is the wrong track, then wrong never felt so good!

From an economic standpoint, here are some trends across various areas of the economy:

1) Economic growth had been solid if unspectacular until early 2014. However, GDP has been growing at an annualized rate of nearly 5% over the last 6 months, which is quite good. 

2) Labor market - unemployment rate is at 5.8%, the lowest its been since 2007, 50 straight months of private sector job growth (which is a record since data has been collected), 10 straight months of 200K job growth, the longest streak since 1995.

3) The stock market has one of the longest and largest runs in decades, with the S&P 500 rising 223% since Jan 1, 2009 and more than tripling! since its low on March 9, 2009. Yes, the S&P 500 has more than tripled in less than 6 years. This rivals the other great bull market run from Jan 1994 to Jan 2000.

4) Annual inflation has been low (between 1 and 3%) since 2009. One can easily make the argument that extremely low inflation can be a bad thing, and that higher inflation would have been helpful in the recent economic context. However, since this post is about public perception and the public never views inflation positively, inflation of 1-3% is excellent.

5) Since it peaked in FY 2009 (the last year of the Bush administration), the deficit has come down each of the last year. Again, it can be argued whether deficit reduction should be a positive in the first couple of years of the crisis. However, the public does not understand that nuance and generally views it as unequivocally good.

6) Growth in health care costs have come down significantly. In fact, health care costs grew only 3.6% in 2013, the slowest rate of growth since 1960.

7) 10-15 million more people have insurance than they did a few years ago and many of them do not have to worry about the prospect of a single medical catastrophe driving them into bankruptcy or worse.

Some of these outcomes are directly due to policy, some are indirectly related to policy, and some are unknown or uncorrelated with policy. But regardless of who gets credit, almost all majors of economic performance are unequivocally headed in the right direction over the last 6 (and any subset of that) years.

In my next post, I will discuss some possible explanations for the public's view in spite of the economic record over the last 6 years.

I Highly recommend John Oliver's "Last Week Tonight"

If you have not listened to John Oliver's new program, I cannot recommend it enough. 

Click here for some examples of his work. 

Also, in a previous post I discussed civil forfeiture in the context of our tiered justice system. 

John Oliver does a much better job of bringing awareness to this topic - highly recommended!

See here. 

The evolution of racism over time

Michelle Alexander's book the New Jim Crow is an illuminating read. Her main thesis is that after each stage of ostensible social progress to overturn systemic racism, the white power establishment worked to preserve their privilege in the new regime in creative ways. Her argument is compelling and she cites two main transitions.  

First, after the abolition movement and the Civil War ended slavery in the United States, racism flourished for nearly a century under the Jim Crow system During this time, the white power establishment intimidated, killed, and then even more powerfully, encoded into law a system of apartheid - the idea of "separate but equal." It was a creative but non-subtle measure of encoding racism into the new system and preserving as much privilege for whites as possible. 

Second, as the civil right movement brought about change in "separate but equal," the white power establishment moved to preserve racism systematically via one primary system ("the drug war") and a multitude of other policy stances. But you dont have to take her word for it, you can listen to the words of two powerful Republicans during this time: 

"The whole problem is really the blacks. They key is to devise a system that recognizes this while not appearing to..."  (H.R. Haldeman, Richard Nixon's White House Chief of Staff)

"You start out by saying n*****, n*****, n*****. By 1968, you can't say n***** - that hurts you, backfires. So you say stuff like forced busing, states' rights, and all that stuff, and you're getting so abstract. Now you're talking about cutting taxes, and all these things you're talking about are totally economic things and the byproduct of them is blacks getting hurt more than whites...'We want to cut this' is much more abstract than even the busing thing, uh, and a hell of a lot more abstract than n*****, n*****" (Lee Atwater, Advisor to Ronald Reagan) 

The "war on drugs," was launched by Nixon in 1971 but fully burgeoned in the 1908s under the Reagan administration. The confluence of the crack epidemic, HIV, and perceptions of increasing crime presenting the Reagan administration with an opening they desired. For example, only 2-6% of Americans saw drugs as the most important problem in the country in 1985. In 1989, it reached a remarkable 64%!  The Reagan administration used this opportunity to institutionalize draconian and racist drug laws that have eviscerated black society for decades. Somewhat conveniently, the same figure stood at 10% by 1990. This despite the fact that violent crime was as high or higher in 1991 and 1992 as it was in the late 80s.  The war on drugs continues today even though (1) it has been an absolute failure in ending the drug trade and (2) even though all crime has steadily fallen 50% from the peak in 1991! It has been successful in one way though: incarcerating an unprecedented number of black Americans, which could be argued was the original goal. The leading cause of the incarceration of African American men is non-violent drug offense. 

Drug laws provide a clever cover for racism because ostensible, because drug laws seem like a good thing. And as Atwater so eloquently stated, the war on drugs is not obviously racist. But dig underneath and it becomes clearer. . 

Drug laws encode racism in three ways. First, the sentencing of laws is racist. For example, sentencing for drugs used predominantly by poor blacks (crack) were 100 times as punitive as laws for drugs used by more diverse populations (cocaine) even though crack and cocaine are not substantially different. Second, the drug market has a long value chain, from inputs, to production, to transportation and distribution, to dealers, to consumption, to money laundering. In this process, street-level dealers and consumers are the least powerful and most black and also the most punished.  It makes no sense to primarily target street-level dealers and consumers if your goal is to end the drug trade. It makes a lot more sense when you goal is something else. Third, drug laws are selectively enforced.  

There is much more to think and write about on this topic but in the meantime I recommend reading Michelle Alexander's book.