Tuesday, December 31, 2013

Privacy is out the window

Sure, we're upset about the NSA spying. But Yasha Levine says that the spying done by Google and other companies is probably worse

Take, for example, the automated cars Google uses for its Street View application. Besides taking photos, the cars were geared to pick up all the wireless network communication data that crossed their path. An FCC investigation showed that the company knowingly deployed the surveillance program, and then analyzed and integrated the data that it had intercepted. But an even greater invasion of privacy is accomplished via Gmail. 

The Electronic Privacy Information Center and others claim that Google does not restrict its email scanning activities solely to its registered user base, but intercepts and analyzes the private communication of anyone who exchanges emails with a Gmail user.

Levine has reviewed two patents filed by Google before releasing Gmail. The patents allow Google to construct user profiles based on:
  • Concepts and topics discussed in email, as well as email attachments
  • The content of websites that users have visited
  • Demographic information — including income, sex, race, marital status
  • Geographic information
  • Psychographic information — personality type, values, attitudes, interests and lifestyle interests
  • Previous searches users have made
  • Information about documents a user viewed and or edited by the users
  • Browsing activity
  • Previous purchases
There is currently a class action lawsuit against Google asserting that the scanning of the messages violates state and federal anti-wiretapping laws.
Levine has written other articles about this issue.

Congress and the Unemployed

From the Washington Post

Monday, December 30, 2013

Some Sad Charts from Steven Rattner

Three of the charts he had in today's NY Times.

2013 as seen by Reuters photographers

The NY Fed is THE Boss

Pam Martens of Wall Street on Parade has been bashing the NY Fed for quite a while. Her basic argument is that the bank is riddled with conflicts of interest; the bank is basically in bed with Wall Street. Some points she makes in her latest diatribe:
This is just a partial list of how the New York Fed is unique among its peers:
The President of the New York Fed sits permanently on the Federal Open Market Committee (FOMC). The Presidents of the other 11 regional banks rotate on the FOMC;
Although there is no law requiring that the New York Fed should be the sole regional Fed Bank to conduct the open market operations of the FOMC, it has uniquely served in this function since 1935;
It is the only regional Fed Bank to have its own trading floor and speed dials to the largest firms on Wall Street;
It is the only regional Fed Bank to be allowed to intervene in foreign exchange markets;
The New York Fed, uniquely among the regional Fed Banks, stores gold for foreign central banks, governments and international agencies;
The New York Fed played a uniquely controlling role in the disbursement of trillions of dollars in loans to foreign and domestic banks during the 2007 to 2010 meltdown of Wall Street;
And, problematically, while needing the good will of Wall Street firms to carry out its open market operations mandate, it simultaneously functions as a primary regulator to some of the largest firms.
You really should read the full article. It will raise some fundamental questions about our government.

Comments on our times.

from the NY Times

Acetaminophen can have some bad effects

ProPublica has been doing a lot of work relative to acetaminophen. The drug has been very useful in relieving pain and reducing fevers. But, like most things in life, it is not perfect. If taken in large doses, the drug can damage your liver and even kill you. 

ProPublica's latest report discusses the dangers the drug presents to children who may accidentally drink too much of the liquid form of the drug. The federal government estimates that in 2011 74,000 kids came to the ER because of drinking the drug; about 1 in 5 had to be hospitalized for further evaluation. About 20 children died each year from such accidents.

These accidents could be prevented by use of a type of safety valve called a flow restrictor. It slows the release of fluid, providing a backup if caregivers leave child-resistant caps unfastened or kids pry them off. The device is now part of infants’ and children’s acetaminophen. However, kids can still get at other pediatric or adult drugs, use of which accounts for roughly one-quarter of kids’ ER visits for drug accidents.

Also,some companies that have placed flow restrictors on acetaminophen-only kids’ products have not put them on bottles of pediatric cough and cold syrup that contain the same amount of acetaminophen. Why government agencies have not acted to prevent such use is difficult to understand.

Thursday, December 26, 2013

The Crooked Forest

These pine trees have been growing in Western Poland since 1930. They began life as normal pine trees. But at some point in the 1930s the planters decided to hold the trees down to create the effect seen above.  The forest contains about 400 trees.

Say "no" to the TPP

Bob Burnett, who has a strong technical background, summarizes some of the problems with the Trans Pacific Partnership:

1. U.S. trade negotiators want TPP to get special, "fast-track" treatment from Congress.
2. TPP doesn't include China.
3. Free-trade agreements, such as TPP, haven't protected U.S. jobs.
4. If TPP were to be approved, most of the benefit would go to corporations and the rich.
5. There are a wide variety of serious issues that need to be discussed by Congress and the American public.

I guess it's not the American way

Frankly, the lionization of the military really frosts me. When the First Lady says, "And with more and more of our troops back here at home, now it’s our turn to serve – it’s our turn to step up and show our gratitude for the military families who have given us so much. And that’s why Jill Biden and I started our Joining Forces initiative – to rally all Americans to support our military families in ways large and small", I want to vomit.  I find it hard to accept that the military has given us so much more than many other Americans have, whether those Americans be teachers, doctors, policemen, your next door neighbor, etc.

I could understand such concern and sympathy when we were drafted and had no choice as to how we served this country. Today's military volunteered to join the service, just as someone volunteers to be a policeman, doctor, teacher, philanthropist. Who really does more for this country?

Of course, I have to realize that Obama's repeated praise for the military is just more of the b.s. that is endemic to being a politician today.

Monday, December 23, 2013

Setting a record

There is just too much b.s. coming out of Washington. The administration tells us that Healthcare.gov logged a record-breaking 850,000 site visits by 2 p.m. today. Using this logic the first visitor to the site on October 1 also set a record. How stupid do our leaders think we are?

Chip or Strip?

Most countries in Europe and Asia use a credit card based on embeddable microchips. Our credit cards are based on magnetic strips. Hacking the microchip card is a lot harder than hacking the magnetic strip card. Hence,we have become the place for the hackers to spend their time. 
Other countries have been using the chip cards for ten years or so, largely because of a push by the financial regulators in those countries. We have begun to use these cards, but 99% of us don't. 
Since the chip cards are a major medium of exchange elsewhere, frequent U.S. travelers to these countries have started to switch to the chip cards. In fact, our credit card companies have set October 2015 as the date when we will join the rest of the world and upgrade our cedit card technology.

Do as I say

Our leaders call for improved working conditions in sweatshops in places such as Bangladesh, the Dominican Republic, Haiti, Mexico, Pakistan and Vietnam. Yet the federal government spends more than $1.5 billion a year at sweatshop factories overseas, acquiring everything from the royal blue shirts worn by airport security workers to the olive button-downs required for forest rangers and the camouflage pants sold to troops on military bases.

The primary reason for the continuation of this practice is the same as us in our roles of shoppers - price. Most of these purchases are made through contractors, rather than through the factories themselves. So, few federal agencies know where these products are actually made.

Keeping us on the right track

io9 has an interesting map of weird sex laws in this country. Here are some of the more interesting:
Alaska Moose are banned from having sex on city streets (in Fairbanks).
Arizona You may not have more than two dildos in the same house.
California No man shall dress as a woman without the written permission of the sheriff. (In Walnut, CA)
Illinois If you sell a reptile, you must give a written warning not to "nuzzle or kiss" them.

Louisiana Necrophilia is legal.

Tennessee Students may not hold hands in school.

Texas It's illegal to own more than six dildos.

Utah It's illegal to marry your first cousin before the age of 65 — or 55 if you can prove both parties are infertile.

Sunday, December 22, 2013

Gatherings of people can be dangerous

We have a thing about people gathering together in places like Iraq, Yemen, Afghanistan, etc. We try to kill them. It doesn't matter if they're attending a wedding or a funeral. Someone determines that there is at least one bad person in the crowd, so it's okay to wipe out the crowd. Since the war on terror began, we have wiped out eight wedding parties killing about 300 people. Could all of them have been members of al-Qaeda?

Friday, December 20, 2013

The dog had to be right

True or false? A woman from New Mexico has filed suit against the U.S. Customs and Border Protection, the University Medical Center of El Paso, and various agents. She charges that she was searched for drugs while crossing the border into Texas. The search was initiated by a drug-sniffing dog. The Customs people really tried hard to verify that the dog was right; the woman was subjected to more than one search of her body cavities. She was taken to the Medical Center when the border search found no drugs. The Medical Center also found no drugs, but billed her $5,000 anyway. All of this was done without a search warrant being issued.

More money available from Medicare Part D

A month ago I wrote about Medicare's failure to take advantage of the far lower cost of generic drugs bought through Part D. This failure cost us $300,000,000 a year. Today, ProPublica reports on more shenanigans re Part D - fraud.
Again, we're talking millions of our dollars going down the drain because of poor management by our employees. Credit card companies routinely scan their records for fraud, flagging or blocking suspicious charges as they happen. Medicare can't do that. Thus, there are those doctors whose prescription volume can double, triple, etc. in one year, but Medicare does not do anything about it, like looking into the reason for the rise.
Part D payments are made by insurance companies. However, if insurers suspect fraud, Medicare encourages — but does not require — them to notify its Part D fraud contractor, a private firm hired to review complaints and recommend cases for investigation. The insurers, however, are not allowed to block a suspect doctor's prescriptions. There is no attempt made to determine whether other insurance companies are paying exorbitant money to the suspected doctor.
Does Congress really want to reduce the deficit?

Leaving money on the table

Oil and gas companies pay royalties to state and federal governments for drilling on our land. They pay 25% to Texas, 18.75% to the federal government for drilling offshore. But they pay only 12.5% for drilling on federal lands.  This rate was established in 1920 and is the same today. Using it results in lost revenue of hundreds of millions of dollars every year. This loss is shared between the federal government (51%) and the states in which the federal land is located (49%).

Wednesday, December 18, 2013

Making Money from Pigs

Many drugs are made from animals. I want to talk about one made from the pituitary glands of slaughtered pigs. It's called H.P. Acthar Gel and is made by Questcor Pharmaceuticals. The drug has been around since 1952; a division of Armour & Company, the meatpacking company, developed the drug as a way to get more revenue from the meatpacking business. The drug, known as Acthar was used to treat infantile spasms, also known as West syndrome, a rare, sometimes fatal epileptic disorder that generally strikes before the age of 1. The patient's cost of the drug was $40. Because it was a very different FDA in those days, Armour did not need to run clinical trials and label could state that the drug could be used to treat about 50 diseases. The drug was used only for very rare cases.

In 2001 Questor bought the rights to the drug for $100,000 and a small royalty on sales. The company made two major changes in the marketing of the drug. It increased the price per vial from $1,650 to $23,000 (it is now $28,000) and started selling it for diseases other than infantile spasms. Based on the labeling approved in the 1950s by the FDA, the company sold the drug as treatment for multiple sclerosis, nephrotic syndrome and rheumatologic conditions, even though there is little evidence that Acthar is more effective for those other conditions than alternatives that are far cheaper. 

The new marketing ideas have worked out very well for Questor. Sales of Acthar, which accounts for essentially all of Questcor’s sales, totaled nearly $350 million in the first nine months this year, up 145 percent from the period a year earlier. In the same period, Questcor’s earnings per share nearly tripled, to $2.12. In the five years after the big Acthar price increase in August 2007, Questcor shares rose from around 60 cents to about $50, in one of the best performances of any stock in any industry.

Questcor is a very imaginative company. Most people cannot afford Acthar and rely on their private insurance policy to do so. However, these policies usually require what is a fairly healthy co-payment, for example, $5,000 for drug purchases of $100,000 or so. Some kind people have started foundations whose purpose is to help people with the co-payment. One of these foundations, Chronic Disease Fund, just about specializes in the diseases addressed by Acthar. And guess what? Questor makes large donations to this fund. But, in a certain sense, the company is discounting its product as it supplies the co-payment. So, instead of a $100,000 sales it makes a $95,000 sales. Without the foundation it probably would have mad no sale.

The word 'pig' is not only used to identify the animal that supplies the basic ingredient for Acthar.

Tuesday, December 17, 2013

Prisons: the coming crisis

As we know, we have a thing for prisons. With 5% of the world's population we manage to hold 25% of the world's prison population. We're able to achieve such a weird situation because we have a different perception of criminality than most other advanced countries. Heck, in the federal system alone, there are now well over 4,000 offenses carrying criminal penalties in the United States Code.  In addition, an estimated 10,000 to 100,000 federal regulations can be enforced criminally.

The costs of our penal system have increased dramatically over the past 25 years. California now spends more money on prisons than on schools. And the outsourcing of prisons has not resulted in any cost savings. The budget problems naturally make the prisons less safe and secure, largely because of overcrowding. 

Don't we have better things to spend our money on?

One step for the better

GlaxoSmithKline has decided to stop paying doctors to promote its products, which was usually done by the doctors speaking at healthcare conferences. The company will also stop tying compensation of sales representatives to the number of prescriptions doctors write, i.e., no more sales commissions. 

I wonder whether these changes are due to the Affordable Care Act, which will require disclosure of these types of payments.

Monday, December 16, 2013

Is this NSA loss temporary?

U.S. District Judge Richard J. Leon said that the National Security Agency’s widespread collection of telephone records of millions of Americans is likely unconstitutional.  He granted the request for a preliminary injunction blocking the collection sought by Freedom Watch, but stayed action on his ruling pending a government appeal. This is the first time a federal judge in open court has issued an opinion on the program’s likely unconstitutionality.

Leon wrote, “No court has ever recognized a special need sufficient to justify continuous, daily searches of virtually every American citizen without any particularized suspicion.”

Employee or Independent Contractor?

Some employers - the Dept. of Labor estimates 30% - do not properly classify their workers. They classify their workers as independent contractors rather than employees; by doing so the employer reduces his costs: no payroll taxes, no employee benefits.

But the law says that an employee's status is determined by the degree of an employer’s control over the manner and means of work, not any written agreement. Yet, these so-called independent contractors wind up doing exactly what they were doing as employees.

Strangely, Congress is actually trying to rectify the problem via the Payroll Fraud Prevention Act of 2013. This would make employee misclassification a violation of the Fair Labor Standards Act and, thus, impose stiff penalties on offending employers.

Sunday, December 15, 2013

Reelection above all

We've seen where the White House held back defining some of the rules necessary for the Affordable Care Act because they felt this would impact the 2012 election negatively for Mr. O. The rules for Obamacare were not the only rules held off because of the election. The Washington Post has an extensive article on this today; the newspaper says that its article is based on documents and interviews with current and former administration officials.

The postponed rules also affected the environment and worker safety. Rules covering such matters as our waters, industrial boiler pollution, exposure to silica were deemed to be less important than winning an election. 

True, every other administration probably did something like this but it looks like the number and scope of delays under Obama went well beyond those of his predecessors. A report by the Administrative Conference of the United States (ACUS), an independent agency that advises the federal government on regulatory issues, said internal reviews of proposed regulatory changes “took longer in 2011 and 2012 because of concerns about the agencies issuing costly or controversial rules prior to the November 2012 election.”

Is 6% an acceptable error rate?

The government has confessed to a 6% error rate relative to at least one type of error: it failed to inform insurance companies about some people who had chosen health plans on HealthCare.gov. But the insurance companies say that when they are informed there are still errors in some cases. Some of the errors:

  • the home address for a new policyholder was outside an insurer’s service area. 
  • a child was listed as the main subscriber — the person responsible for paying premiums — and parents were listed as dependents. 
  • children were enrolled in a policy by the federal government and parents were left off, or vice versa. 
  • the government mixed up the members of a family: A child or spouse was listed two or three times in the same application.

Saturday, December 14, 2013

Overdoing deferred prosecutions

From 2004 through 2012, the Justice Department entered into 242 deferred prosecution and nonprosecution agreements with corporations; there had been just 26 in the preceding 12 years. These agreements allow companies to avoid criminal charges if they pay substantial penalties, improve their compliance programs and cooperate with authorities. The companies do not plead guilty. They are not convicted of any crimes. They do not receive criminal sentences. They just pay a fine.

Why have we become afraid to prosecute people?

Who's coming to town?

Hat tip to The Big Picture

Moyers on the NRA

Borrow $1,000. Pay back $40,000

A $1,000 loan taken out five years ago has ballooned to a principal balance of $40,000. When Naya Burks of St. Louis borrowed $1,000 from AmeriCash Loans, she signed an agreement to pay back $1,737 in six months. That's bad enough, but she defaulted on the loan and entered the legal system when AmeriCash sued her. 

She was then faced with more costs and garnishment of her wages. She was lucky that she hadn't dealt with Tower Loan; then she would have also gotten stuck with paying the company's attorney.

Many borrowers from these high-cost lenders default. In Oklahoma alone, 95,000 suits have been filed since 2009.

Friday, December 13, 2013

$486,000,000 down the drain

Another minor problem with our stay in Afghanistan - We bought sixteen G222 turboprop aircraft from Finmeccanica for $486,000,000. They have flown a mere 200 hours and now sit in a field at Kabul Airport ready to be scrapped. 

Lieutenant General Charles Davis, the service’s top military acquisition official, says,“We looked for buyers, people to accept those, and nobody was interested in trying to maintain an airplane that was no longer sustainable, so that’s why” these aircraft “are sitting on the ramp and not going to fly.” They will be stripped of military gear “and destroyed and moved out of the country.” 

These planes were expected to make up 15% of the Afghan Air Force. Will we supply replacements?

Thursday, December 12, 2013

Sexual harassment in Colorado

Santiago Lyon is mad

He's the vice president and director of photography at The Associated Press. He's also a member of the White House Correspondents Association. He does not like being cut out of the ability to photograph Mr. Obama, as he was able to photograph presidents that preceded him.  

Lyon is surprised that the press corps has been able to photograph Obama in the Oval Office only twice in the five years he has been in office, again a sharp contrast to Obama's predecessors.

Lyon raises the issues of propaganda and 1984 in that the photos propagate an idealized portrayal of events in the Obama administration. Does this practice presage the abolition of press conferences? Will reporters lose access to the White House?

Wednesday, December 11, 2013

When will the Volcker Rule be in effect?

The earliest is July 21, 2015, five years after Dodd-Frank passed. eight years after the Great Recession began. But it may be later than that per this part of the rule: “The Board will continue to monitor developments to determine whether additional extensions of the conformance period are in the public interest, consistent with the statute.” Why the need for an extension since Wall Street has known for over three years that it has to divest itself of activities banned by the Volcker Rule? Why do they need another 18 months or longer?

1 year after Newtown

The states have passed 109 laws with regards to gun control, 30 of these laws tighten restrictions, 70 loosen them.  Restrictions have been tightened with regard to such issues as mental health, background checks, assault weapons and lost or stolen firearms. Restrictions have been loosened with regard to gun permits, public carry, guns in schools, nullifying federal law. Given the strength of the gun lobby, it seems to me that the issues where tightening has occurred are the more important ones.

You don't eat these cookies

I'm referring to the cookies placed on your computer by advertising networks to identify people browsing the Internet. The NSA especially likes a cookie known as the Google "PREF" cookie.  This cookie typically does not contain personal information, such as someone's name or e-mail address, but contains numeric codes that enable Web sites to uniquely identify a person's browser. It enables NSA to single out your communications, so that it can hone in on someone already under suspicion - which is a good thing, I suppose.
We also learn today about HAPPYFOOT, an NSA program that enables it to determine the physical location of your smartphone.
When will Snowden exhaust his treasure trove?

Something worth stealing..

...if you have a sweet tooth. A truck filled with $120,000 worth of Hershey bars was stolen in Florida the other night. My kind of crime.

Tuesday, December 10, 2013

Honor the contract?

Well, in the view of our government, that depends. When AIG decided to pay bonuses to its executives just after we had bailed it out, the government said that the bonuses were contractual obligations and they had to be honored. When the workers for the city of Chicago expect to receive their pensions, the city says that it does not have to honor the contract. Interestingly, Rahm Emanuel, when working for the federal government decided the government had to honor the AIG contract; as mayor of Chicago, Mr. Emanuel thinks the opposite with regard to the city workers. Mr. Emanuel holds this view even though the constitution of Illinois states that pensions earned by public sector workers cannot be cut. 

If you like your NSA spy

Monday, December 09, 2013

You can be good at different things

John LaForge questions just how good - in the moral sense - our military really is. While his article is primarily about the sexual assaults on women in the military, he includes some interesting headlines from articles over the past 20+ years:
• “US Practiced Torture after 9/11, Nonpartisan Review Concludes” (Apr. 16, 2013)• “Afghans Say an American Tortured Civilians” (May 13, 2013)
• “CIA Drones Kill Civilians in Pakistan” (Mar. 18, 2011)
• “GI Kills 16 Afghans, Including 9 Children, in Attacks on Homes” (Mar. 12, 2012)
• “Libya Effort is Called Violation of War Act” (May 26, 2011)
• “NATO and Afghan forces killed 310 civilians over the same period, mostly from airstrikes, the UN reports” (Aug. 3, 2009)
• “100,000 Iraqis killed since U.S. invasion analysis says” (Oct. 29, 2004)
• “U.N. Chief Ignites Firestorm by Calling Iraq War ‘Illegal’” (Sep. 17, 2004);
• “Iraq Says Blast in Baghdad Kills Dozens of Civilians: U.S. Blamed” (Mar. 29, 2003)
• “U.S. Presses for Total Exemption from War Crimes Court” (Oct. 9, 2002)
• “Pentagon Says U.S. Airstrike Killed Women and Children” (Mar. 13, 2002)
• “Bombing Necessary Despite Toll on Civilians, U.S. Envoy Says” (Jan. 9, 2002);
• “U.S. helicopters fire on women, children in Somalia” (Sep. 10, 1993)
• “US forces buried enemy forces alive” (Sep. 13, 1991)
• “200,000 died in Gulf War, and counting” (May 30, 1991)

Sunday, December 08, 2013

Big Pharma in action

Genentech, a division of Roche Group, makes two drugs that have been proven to help those with wet age-related macular degeneration. One, Avastin, is used "off-label", the other, Lucentis, is specifically for macular degeneration. Genentech works hard to convince ophthalmologists to use Lucentis. The company thinks Avastin is fine for colorectal cancer, but not for macular degeneration. That may be because Avastin costs about $50 per injection,while Lucentis costs about $2,000 per injection. Both drugs have been deemed to produce the same results as shown in six major trials.

While the majority (61%) of doctors prefer to use Avastin, Lucentis is used enough times that it costs us - via Medicare - $1.2 billion a year. Some doctors think the risk of the repackaging of Avastin to make it useful for the eye is too great. However, one should keep in mind that doctors are reimbursed for the average price of the drug plus 6 percent. And 6% of $2000 is a lot more than 6% of $50.

Medicare is helpless in making doctors use the less costly drug. It can't negotiate directly with the drug companies, as health agencies in other countries do. Authorities in Britain, for example, have negotiated a price of about $1,100 per dose of Lucentis, and in the Netherlands a dose sells for about $1,300. Nor can it restrict payment to the amount of the less costly alternative.  

Perchance, Congress has limited Medicare in such ways because over the past 15 years, the pharmaceutical industry has far outstripped any other in the money it has devoted to lobbying, according to data from the Center for Responsive Politics. Drug companies spent a total of $2.7 billion over that time.

Saturday, December 07, 2013

Jack be nimble

That's Tom Ricks' message with regard to our military. He thinks that the United States still has an Industrial Age military in an Information Age world. In today's world we need a military that is not necessarily “ready for combat” at any given moment but instead is most able to adapt to the events of tomorrow. Adaptation is a key word. Will our military be able to adapt fast enough to our changing world. We can't say we were very quick in adapting to the insurgencies we have tried to defeat.

Friday, December 06, 2013

The 834

That's the form that Healthcare.gov sends to insurance companies when one has successfully registered with the website. Again, the government is not expecting 99.9% accuracy of these forms. They even have the temerity to boast that 90% of the forms created this month (did they create any 834 forms in October or November?) were correct. in 1 out of 10 cases, this wonderful system either did not generate an 834, issued a duplicate form or issued a form with incorrect data. So, those who were able to get through the system may still find themselves uninsured. They must call the insurance company.

Thursday, December 05, 2013

Words, words, words

I voted for Obama twice. Most people would classify me as liberal. But I must say that I find it hard to believe that I could have been so misled with regard to Obama. Okay, it's pretty obvious as I've said before that Obama's managerial skills are non-existent. Now I am questioning his veracity.

We have the question of why he would vow that you could keep your insurance plan despite the passage of the ACA. Was he lying? Today comes another instance where I have to ask the question - was he lying. And this is with regards to a very minor issue: did he or did he not live with his uncle

Obama's press secretary is today's person to fall on his sword. He says that when the question was raised two years ago he was the one who concluded that Obama had never met his uncle.  Obama had never answered the question. Today, Carney says that Obama lived with his uncle briefly while the president was a student at Harvard Law.

Another federal agency that has difficulty being audited

The Department of Homeland Security can't seem to convince its auditors that everything is kosher from a financial point of view. The most recent audit (FY2012) resulted in a qualified opinion due largely to the agency's weak internal control and ineffective financial management systems. The agency hopes to achieve a clean opinion on internal control over financial reporting for fiscal year 2016.

Paying the Piper?

More on Glenn Defense Marine

This is the company that may have committed the largest fraud against the Navy so far in the 21st century and maybe in the 20th century as well. Part of its success can be attributed to their bribing naval officials or to the laziness or stupidity of officials. By some form of magic the firm was able to submit the same reimbursement form a number of times. Many of these forms were, in fact, forgeries. 

During one nine-month period in 2011 and 2012, the company submitted 282 false quotes from subcontractors for incidental services at three ports in Thailand alone, resulting in losses to the Navy of $2.3 million, according to federal criminal charging documents. Similarly, during the same period, Glenn Defense Marine billed the Navy for $4 million in fictitious tariffs at two of the Thai ports, submitting more than 100 fraudulent invoices from purported Thai government agencies that in reality were shell companies, the charging documents show. Glenn Defense Marine also artificially inflated the price of fuel, overbilling the Navy by more than $3 million for just five fuel purchases in Thailand in the fall of 2011, the documents show.

The joys of eating as one ages

The Pentagon needs its own drug-making factory

No one doubts that soldiers need to be protected against germ warfare. The Department of Health and Human Services, working with university researchers and drug companies, is spending billions on a drug plant that will do the job. Yet, the Pentagon wants its own plant and has begun construction.

Social Security Benefits Compared

The OECD compared social security benefits against a retiree’s last earnings as an employee. Of the 35 countries reviewed, the U.S. median benefits amount to 41% of earnings. The average of all countries is 57.9%; in Holland it's 90%.

Wednesday, December 04, 2013

We have the best healthcare

That depends on how you define it. If you define it by money spent, we sure do. We spend about $8400 per person, while most advanced countries spend between $2,000 and $5,900. If you measure it by life expectancy, ours is 78 or so, while the most advanced countries have expectancies around 82.

Where the smart people go to college

Of course, it's the Ivy League. Why wouldn't the median grade of Harvard students be A-?  After all, the most frequently given grade is a straight A. Princeton has so many smart students that they limit an A grade to 55% of the sophomores and juniors. 62% of Yale students from 2010 - 2012 had an A average. You've never met an Ivy Leaguer who was not the smartest person in the room. Have you?

I think many of the professors at these universities majored in grade inflation.

Today's missing Healthcare.gov feature

The system was supposed to send certain payments to insurance companies as people signed up. The system was supposed to calculate the amount of premium tax credits and cost-sharing benefits that low- and middle-income enrollees were eligible for after they sign up for marketplace coverage. Then, the system would send insurers money to help pay for coverage.

This is another feature that will be postponed. To receive these payments insurers will now have to manually submit their subsidy payment requests to the U.S. Department of Health and Human Services, which will verify the amounts and pay them electronically using the Medicare automated payment system.

As one would expect, the administration says that consumers will not be impacted by the change.

Read more here: http://www.mcclatchydc.com/2013/12/03/210455/hhs-temporarily-scraps-automated.html#storylink=cpy

What the world needs now

According to Microsoft it's a bra that tries to keep women from overeating when they feel stress. The company has invented such a device. It is placed in the bra to monitor heart rate, respiration, skin conductance and movement. The device then sends the data to a smartphone app which tells the user to stop eating. The likelihood of a person following this instruction is minimal plus the battery of the device lasts only four hours.
Microsoft, being a 21st century company, also tried the device in men's underwear, but it did not work well because of the distance of underwear from the heart.

Tuesday, December 03, 2013

Mind our own business?

Errors for one-third of those "signed up"

We know that Healthcare. gov is still a work in process. But it's far from complete if, as the Washington Post says, the system has produced erroneous data for one-third of the people who have signed up for health plans since Oct. 1. Most of these errors affect the actual purchase of insurance - the purpose of Healthcare.gov. "The mistakes include failure to notify insurers about new customers, duplicate enrollments or cancellation notices for the same person, incorrect information about family members, and mistakes involving federal subsidies."

The system also is handling the problem of too many people accessing it at one time by putting them in a queue where they can wait or try later. One instance quoted happened when only 35,000 were on the site.

Words, words, words.

Monday, December 02, 2013

Healthcare.gov “will work smoothly for the vast majority of users.”

So say Obama and company. The question is what does working mean. It does not mean that one can buy a policy on the site - and isn't that what the site is supposed to let you do. Plus, the site still does not work in any way for 10% of those who log on. It's just words, words, words. It looks as though that will be Obama's "legacy" - words, not results.

Viola Organista

Leonardo DaVinci spent some time designing a musical instrument. He never did produce the instrument. Many people have tried. One has succeeded, at least he said he has and has actually played the instrument, which is a cross between a harpsichord and a cello; he calls it the Viola Organista. The man who has done this is a Polish pianist Slawomir Zubrzycki. He spent four years at the task. The result is heard in the video below.

Hat tip to our Florida correspondent.

Saturday, November 30, 2013

This is not the Navy's month

Today's NY Times begins the tale of Inchcape Shipping Services and the U.S. Navy. I suspect the story is only beginning, as no Navy personnel have been mentioned as being involved. Inchcape, which happens to be owned by the government of Dubai, had a very simple scheme. It paid commissions to subcontractors willing to give large discounts, then pocketed the difference instead of refunding it to the Navy. The difference was in the millions and the scheme went on for years. At the same time the Navy extended its contract with Inchcape although the Justice Department had begun investigating a whistle-blower's allegations of fraud and thievery.

Stay tuned.

The Draft and Congress

Dana Milbank offers another argument for bringing back the draft. We might get a better Congress.  Here's the nub of his argument: "Because so few serving in politics have worn their country’s uniform, they have collectively forgotten how to put country before party and self-interest. They have forgotten a “cause greater than self,” and they have lost the knowledge of how to make compromises for the good of the country. Without a history of sacrifice and service, they’ve turned politics into war."

He may have a point, as only 19% of our legislators have seen military service; this is the lowest since WWII. 

Summing up Pope Francis?

From Toles in the Washington Post

Friday, November 29, 2013

A Slow Recovery

The Dallas Fed has two interesting charts about the current economy. Chart 1 shows that the recovery from the Great Recession is pretty bad. Five years after the business-cycle peak our recovery is much worse that previous major recessions.

Chart 2 shows some of the economic indicators. Employment and production are especially bad.

Thursday, November 28, 2013

What is the real India?

Pankaj Mishra reviews the latest writings of Amartya Sen and Jagdish Bhagwati, two prominent Indian economists. Sen is a Nobel laureate. I had thought that India had made many advances in the 21st century. But, if Mishra is right - and I have no reason to doubt him - it is the upper classes that have moved forward; it is still a backward country. Here are some excerpts from the review:
The 2011 census revealed that half of all Indian households have to practice open defecation. Nearly half of all Indian children are underweight (compared to 25 percent in sub-Saharan Africa), and as Sen and Drèze point out, despite a rise in literacy rates, “a large proportion” of them “learn very little at school.” Almost all Indians buy health services from private providers, exposing themselves to crippling debt as well as quackery. Inequalities have widened between classes, regions, and rural and urban areas. More worryingly, they seem unbridgeable owing to the lack of adequate education and public health. Not surprisingly, poverty declines very slowly in India, slower than in Nepal and Bangladesh, and unevenly.20 Calorie and protein intake among the poor has actually dropped.
“India today,” the historian Ramachandra Guha writes, “is an environmental basket-case; marked by polluted skies, dead rivers, falling water-tables, ever-increasing amounts of untreated wastes, disappearing forests.”22 Meanwhile, as Sen and Drèze write, the largely corporate-owned media, deeply indifferent to poverty and inequality, and reflexively intolerant of any remedial action by the government, produce “an unreal picture of the lives of Indians in general” by celebrating the fame and wealth of billionaires and cricket and Bollywood stars.
That drama is one of an elite that expands and is entrenching itself. Increasingly impatient with the rules and ethics of democracy, India’s ruling class today consists, as C. Rammanohar Reddy, editor of The Economic and Political Weekly, defines it, “of large Indian businesses, the new entrepreneurs in real estate, finance, and IT, the upper segment of the urban middle classes, the upper echelons among the bureaucracy, and even large sections of the media.”

Kids show the way

Wednesday, November 27, 2013

War on Irrational Fear

Incitement Design has launched the War on Irrational Fear. The basis of much of this first video is the work of John Mueller, of whom I wrote a while ago.

Keeping photographers out

Last week I wrote about what appears to be a new White House policy barring media photographers from certain events while at the same time having White House photographers film the events and make them generally available. The deputy press secretary explains the policy, “There are certain circumstances where it is simply not feasible to have independent journalists in the room when the president is making decisions.”

Apparently, Mr. Obama makes decisions at some strange events. Dana Milbank has some examplesThe president and first lady waving to a sea of people, with the Washington Monument in the background, on the 50th anniversary of Martin Luther King’s march; Obama swimming with one of his daughters in the Gulf of Mexico to show that the water is clean; Obama embracing one of his daughters in Nelson Mandela’s prison cell; the president touring the West Bank church on the spot where Jesus is thought to have been born (news photographers were allowed to shoot images when George W. Bush toured that location); Obama alone on the Rosa Parks bus, sitting in the same row where the civil rights icon sat; Obama shaking hands on Veterans Day with the oldest living World War II veteran; Obama shaking hands with Mitt Romney in the Oval Office; the first lady and the president greeting kids the day White House tours resumed this month.

A transparent administration or a 1984 administration?

The Craziness of Sports

Did you know that 41 states have passed the Uniform Athlete Agents Act? This is a law crafted by the NCAA to restrict contact between sports agents and college athletes. Such contact was part of the NCAA rules. Now it is part of our laws.

If you hand money or give advice to a college athlete, you are breaking the law. The law goes beyond agents; those who act as go-betweens for the agents can also be tried under this law. The first such case is happening in North Carolina. 

Jennifer Wiley Thompson was an academic adviser for North Carolina athletes. Of course, the question of why athletes have academic advisers and other students don't boggles the mind. She was accused of helping athletes write better papers. She also passed $3,309 from an agent to a player. It is for this she is being tried, although it was not her money; she simply was a transfer agent.

The NCAA is working on expanding the Act to cover high school athletes.

Tuesday, November 26, 2013

Quotes from the Apostolic Exhortation of Pope Francis

Courtesy of Heather Horn of The Atlantic:

"Today everything comes under the laws of competition and the survival of the fittest," he writes. "Human beings are themselves considered consumer goods to be used and then discarded," and "man is reduced to one of his needs alone: consumption." He rejects the idea that "economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world." Instead, he argues, growing inequality is "the result of ideologies which defend the absolute autonomy of the marketplace and financial speculation," which "reject the right of states, charged with vigilance for the common good, to exercise any form of control." And he repeats the exact language he used in an early address: "Money must serve, not rule!"

"One cause of this situation," he writes, "is found in our relationship with money, since we calmly accept its dominion over ourselves and our societies. The current financial crisis can make us overlook the fact that it originated in a profound human crisis: the denial of the primacy of the human person!"

 "In this system, which tends to devour anything which stands in the way of increased profits, whatever is fragile, like the environment, is defenseless before the interests of a deified market, which become the only rule." 

Growth in justice ... requires decisions, programmes, mechanisms and processes specifically geared to a better distribution of income, the creation of sources of employment and an integral promotion of the poor which goes beyond a simple welfare mentality. I am far from proposing an irresponsible populism, but the economy can no longer turn to remedies that are a new poison ... We need to be convinced that charity “is the principle not only of micro-relationships (with friends, with family members or within small groups) but also of macro-relationships (social, economic and political ones)”. ... Each meaningful economic decision made in one part of the world has repercussions everywhere else; consequently, no government can act without regard for shared responsibility. Indeed, it is becoming increasingly difficult to find local solutions for enormous global problems which overwhelm local politics with difficulties to resolve.If we really want to achieve a healthy world economy, what is needed at this juncture of history is a more efficient way of interacting which, with due regard for the sovereignty of each nation, ensures the economic well-being of all countries, not just of a few.

The Nicaragua Canal

Will people in the late 21st century speak of the Nicaragua Canal as we speak of the Panama Canal? Nicaragua and China have just signed an agreement allowing the construction of a new inter-oceanic canal in Nicaragua, connecting China with the Caribbean and its Atlantic-American trade partners. Ships will be able to bypass the congested Panama Canal. 

The canal would also establish China as a major player in Central and South America.

Deciding whether to release a computer program

The Obama administration acknowledges that Healthcare.gov will not work 20% of the time on December 1. Yet, they believe that Healthcare.gov will be good enough to be used by 80% of those trying to do so. If my company released software that would not work 1 out of 5 times, I would have been out of business very quickly, as no one would be stupid enough to buy such software. Would you use Amazon if you knew you would fail 20% of the time? 

Not only would the system not work, it is likely that it will still be sending false information about applicants to the insurance companies. And, of course, if I were Spanish, I would be out of luck as the Spanish-language website will probably not be running. Nor will the online small business marketplace.
I guess the administration thinks we're idiots. I'm not sure GW thought so. 
Read more here: http://www.mcclatchydc.com/2013/11/25/209704/obama-officials-healthcaregov.html#storylink=cpy