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Paul Ryan – Insider Trading and War on Medicare

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Paul Ryan has become a lightening rod for controversy, both for his aggressive plans to cut Medicare and Social Security and for questions surrounding suspicious-looking trades in financial stocks that were September 18, 2008, the same day Congressional leadership was briefed about the crisis by Treasury Secretary Hank Paulson.

The Real News Network interviewed Tom Ferguson to parse out history from hype on both issues.


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32 comments

  1. Ep3

    Yves, they kind of skipped over why Ryan was picked for VP and his plans for Medicare.
    I am seeing it like this. Everyone in Washington loves to hold hands and jump off cliffs together. Well, now in this election we have a clear choice. Medicare and SS are going to be reformed, again, for a while (until a few years later and another crisis in it can be manufactured to cut it further). So, we can all jump off the cliff with Obama and just break our leg (immediate pain and have to walk with a cane for the rest of our lives. But at least we can still walk!). Or we can jump off with Romney/Ryan and become a paraplegic or worse. So we have a clear choice. Even tho we could NOT jump at all. But that wouldn’t serve the interests of the ruling elites.

    1. John

      Let’s say no to both.

      To the elites:
      It’s YOUR 16 trillion dollar debt and WE WON’T PAY.

      We are going to have a decent, civilized society and you criminal elites will be driven from this country if you keep trying to destroy the people.

      1. LeonovaBalletRusse

        John, GREEN Party: Jill Stein/Cheri Honkala are hiring, thru 24 Aug 2012, those who have the acceptable profile and make the cut (Lambert posted a link to this news a couple of days ago).

    2. Waking Up

      Here is another option. We refuse to elect Obama/Romney with their desire to cut Medicare and opt for a President and representatives who actually represent the people. Medicare and Social Security DO NOT NEED CUTS. They are programs which need to be made stronger and act as a support to as many people as possible. Don’t fall for the B.S. narrative and propaganda put forth by the Democratic/Republican parties that these programs need cuts. If we can spend billions of dollars each year to kill people, we certainly can find billions of dollars to actually keep people alive.

      1. citalopram

        This is wishful thinking on your part.

        Obummer will be relected again and he will continue his Great Sellout of the American People. He’ll also continue his War on Muslims as well.

        The American People are going to let him do it to, even though they have all the power they need to put a stop to it collectively.

    3. blue meme

      Your metaphor is slightly off-target. The bi-partisanship fetishists in DC love to hold hands and push the rest of us off the cliff…

  2. The Gizmo51

    Wishing to be a politician detesting government and wanting it to be smaller is, to me, as if wishing to play professional football on a team that plays fewer games losing most of them, but in the process destroys all other teams in sight. Also, if ryan’s medicare plan is so great why not implement it right away? Could it be because today’s seniors would have their benefits cut and their costs raised right away?

  3. briansays

    the solution for medicare is to make it a public option and let the public elect if they want to buy into it rather than be faced with a mandate to buy a crappy overpriced product from a private cabal

    but then that would threaten said cabals ownership of the federal government

  4. Stephen Mapes

    I don’t take issue with his discussion on Medicare, but he really doesn’t make any comment on how you save Medicare other than what appears to be a universal public option only. As an ex CEO of a hospital, the only way Medicare will survive with something like 80 million turning 65 over the next 11-12 years is rationing and huge tax increases.

    What gauls me is the insider trading discussion. GS popped for a few days and then contiuned down to substantial lows like the rest of the market. And until 2011 Congress was allowed to due more insider tradng than an actual insider (still is today but more limited). If this was to be a legitimate criticism, then you should have expanded the discussion of other major Congressional players like Biden Obama Pelosi Ried McCain Dodd, Frank and other members of the Committee that Paulson talked to about the bailout. So how many of them also traded on that inside info?

    And if a blind trust is not really a blind trust then the whole game is riggest in politicians favor. What about more discussion on this.

    It’s time that the media vetted all of these so called leaders in Congress (and family members) and what they get away with with government inside information.

    1. Matt

      I too think rationing of some sort should be in the picture. How can the US be spending 2.8 trillion on health care while other countries a spending 2/3 less as a percentage of GDP.
      Other countries public options must have rationing.
      The US has a problem, the medical industry, banks, hedge funds, other industries etc have captured the government in all 3 branches. And hedge funds are buying hospitals and changing Medicaid charging codes.
      http://www.nytimes.com/2012/08/15/business/hca-giant-hospital-chain-creates-a-windfall-for-private-equity.html?_r=2&pagewanted=1&hp
      By the way there are only about 45 million turning 65 in the peak 10 year period. The Boomer wave covers births from 1946 to 1964.
      http://www.census.gov/prod/cen2010/briefs/c2010br-03.pdf
      I found hospital management wages outrageous. Second level supervisors with 80 reports receiving north of 160,000 a year in rural America before benefits. You probably retired before the top of this bubble.

      1. Borsabil

        The main reason other countries spend far less than the US on health is that they can import drugs through a single payer price fixing model. They can do the same with medical devices. This is possible as they do not have to pay for the development costs of said drugs and devices, it’s American citizens who are made to pick up the tab. Federal law prohibits any citizen from doing what foreigners do as a matter of course, politicians have enacted such laws and given exemption to such practices as price fixing depending on payer because enormous sums are funneled their way as bribes. Neither Obama or Ryan wish to change that, it’s why whoever wins in November Medicare is doomed.

        1. Matt

          US drug spending is a problem, but at 320 billion a year it is only 1/9th of total US medical spending.
          Cost shifting and exemption from US anti trust laws and government subsidies of overpriced tests and unneeded treatments at both the insurance and treatment may be larger forces at work.

        2. reslez

          This is possible as they [other countries] do not have to pay for the development costs of said drugs and devices

          If you are trying to say private companies pay for their own R&D, you are just plain wrong. Private companies don’t pay for their own R&D either. Much of it is subsidized by government or done in public universities. Drug companies spend far more on advertising/marketing than R&D, which they inflate by all sorts of accounting gimmicks anyway.

          And even if you were correct, and all this R&D is subsidized on the backs of Americans overpaying for drugs, why should the U.S. bear the sole burden? Either way Americans are paying too much for too little in order to pad the profit margins of health industry parasites.

    2. ambrit

      Mr. Mapes;
      The proposed system would impose rationing; by tying medical care directly to income. Social Darwinism at its’ best.
      Right now, the only feasible way to make medicine a common good is to make it common. Full single payer, caps on executive income, and mandatory ‘public service’ service would go a long way towards implementing a frankly Socialist system for medicine. I would argue that anything less is anti-social.

      1. ambrit

        Dear self;
        I just remembered that skippys’ wife is a medical doctor in Australia.
        Calling all skippys! What’s the experience of working in the Australian medical system like for yous wife? Any views about this subject from the good lady? Yours? Any lessons learned applicable to the U.S.?
        Thanks in advance. Ambrit.

        1. skippy

          Simply put, it has been observed, that Australia since WWII is about 20 years behind in Americas wake. That has more than halved, regardless of political party’s in power. Our PM is an Obama fan, is quite giddy about him, especially in his presence, see:

          “But back to Gillard and Obama. There is no question that they appear to have a genuine fondness and mutual respect for each other. However, for Gillard, the visit by the President is so much more than that. It provides her with the opportunity to surround herself with ‘Brand Obama’, and bathe in the reflected glory that it provides. After a week or two of improving polls, the Obama visit could not have been better timed for Julia Gillard. She will be loving him being here, less for what outcomes the visit achieves, and more for being able to use ‘brand Obama’ to rebuild the damaged ‘brand Gillard’.” sinp

          http://www.onlineopinion.com.au/view.asp?article=12904

          It should noted that the Greens have done a better job than the now defunct democrat party. Providing sorely needed friction to the ongoing consolidation of both legacy party’s, save the I.D. constituency side show.

          Back to your line of questioning. Firstly the boss is a first responder, not a GP/MD, gets to see the reality of society up close and personal. From golden time to hospital and beyond, warts and all, plus is involved with University paramedical education (@2 State Uni’s).

          So with that said, the system is under a lot of pressure at the moment 4-6hr ramping times at hospital ( even with unstable patients). Rapid pop growth (boom town syndrome), increase in medical procedures (discovery), poorly administered system upgrades ie payroll, accounts, fruad et al, an increasing for profit template from education – up, all over laid on the foundation of the previous investment mythos ie C/RMBS derivatized credit – debt income streams. That’s why there is such a frackus over the mining sector and increases in royalty’s – tax, its the only game in town to make up any short falls.

          Any way, its still light years better than in the states. You can go public and have longer wait times for non life threatening stuff – share rooms – no sushi for lunch and cover your ass with additional private cover (costing is heaps better down under [ Gov does keep the egregious face ripping down to a min ]). Going to GP is free for under 18 and only a small gap free for the older (pay up front and reimbursed at medicare, direct deposit). Same, same with meds.

          Skippy… will this stay the same? There are troubling clouds on the horizon, stuck between our regional co – inhabitants and the ubiquitous America. As always, were just along for the ride… eh.

          1. ambrit

            Dear skippy;
            Thanks for that. I keep forgetting the true meaning of “Globalization.”
            That “twenty years behind the States” might not be such a bad thing if the bottom falls out in the near future. It’ll be that smaller a disaster to recover from. As for your Obama Lover of a President/Premier, nothing helps ease the pain like the recent bit about the woman being chased out of a public place by an angry mob. (Try doing that here in the States without your Kevlar jockstrap on.)
            I like the mystery of you doing the Time Warp, too. “It’s just a jump to the Left…” You have managed to reply to my query two hours before I posted it! The wonders of modern science!
            Live long and prosper.

    3. LucyLulu

      Stephen Mapes wrote: “As an ex CEO of a hospital, the only way Medicare will survive with something like 80 million turning 65 over the next 11-12 years is rationing and huge tax increases.”

      There are other many changes that can be made to reduce costs before implementing more draconian rationing and/or increasing taxes. European nations have been able to provide healthcare to their citizens at less than half what the US pays without appreciable rationing. We should be looking to their models rather than continuing to tweak our own failed system. As one poster mentioned, we must stop subsidizing drugs and medical devices for the rest of the world. Our fee for service model encourages waste and abuse, and places the emphasis on sickness outcomes rather than health. Eighty percent of current costs are related to preventable chronic diseases. Americans have the highest rates of obesity in the world. If Americans could be influenced to reduce their weight and become more physically active, our costs could be dramatically reduced. We should move towards more routine care being provided by nurse practitioners and physician’s assistants as well, a move currently opposed by physicians, which would alleviate any physician shortage, esp. in primary care. We may need to subsidize training of healthcare providers while compensation of physicians may need to align more closely with that of countries across the pond. We stand alone in having such highly paid physicians. Primary physicians have already seen their compensation fall to more sustainable levels (~$160,000/yr.). Six of 25 surveyed specialties have average compensations of over $300,000/yr. per self-report.
      http://www.medscape.com/features/slideshow/compensation/2012/public

      Stephen, you might be interested in knowing that at least as of two or three years ago, hospitals were reimbursed at the rate of $10/day in Japan. No, I’m not advocating those rates and I don’t know how they survive, but hospital billing overcharges ARE common in the U.S., estimated to total ~$10 billion every year. I don’t believe hospitals are making unreasonable profits but they do have policies that contribute to bloated costs, e.g. requiring attendings to admit x number of patients/do x number of surgeries each year to retain privileges, or becoming the third transplant unit in Pittsburgh or second cardiac transplant facility in Lexington, KY.

    4. RW Force

      Doctors in the rest of the developed world are paid half of what they make in the US. I met a woman whose son was a physician in New Zealand. He took his 30 day vacation to work in emergency rooms in the US, and made as much in that one month as he did in the rest of the year in NZ.

  5. Michael Fiorillo

    Thank goodness we can vote against Romney and Ryan, so that Guantanamo will be closed, whistleblowers supported, thousands of private “contractors” brought home from Iraq, financial malefactors and looters prosecuted, the public schools protected from neoliberal privatizers, and cuts to Social Security and Medicare taken off the table.

    I was really worried there for a while.

    1. reslez

      It’s like an election in Hell where the choice is between voting for Satan or Lucifer. Which one do you want to subject you to torture? The power is yours!

      Vote or die!

  6. Borsabil

    To misquote Zoolander, doesn’t anybody notice? Obama’s and Ryan’s ‘plans’ are the same, I Feel like I’m taking crazy pills.

    Both seek to limit the growth of Medicare going forward to a rate 0.5% less than GDP growth on the one hand by regulating, allowing government functionaries to promote efficiency ( the first time in recorded history that will have worked) and on the other by promoting ahem competition within an insurance business set up as a cartel.

    Ryan and Obama project GDP growth of 5% annually for the next thirty years to make their schemes work btw, something not achieved since the end of WW2. Laughable? Pathetic? You decide.

    Here’s the math, the cost of Medicare is growing 9% annually, the economy is growing by 1-2%, the law of exponents tells us that this will lead to a funding crisis in a few short years, but why let facts intrude on elections? The future does not look pretty, we will end up with either a basic socialized government provided health care model or a free market where costs are reigned in by real competition. Neither will give us what we want, gold plated health cover for everyone, but what is certain is that the present system cannot be sustained given an aging population and runaway inflation in pharma and medical devices, but to quote another great thinker you can’t always get what you want.

    1. reslez

      The future does not look pretty, we will end up with either a basic socialized government provided health care model or a free market where costs are reigned in by real competition

      Real competition? Where do you come up with that? No industry wants competition, certainly not one dominated by a few megacorps like the health industry.

      No, the choice is between “basic socialized government provided health care”, or the former middle class dying in the streets because they can’t afford care. That is what a for profit “free market” system looks like. Free market health care means you are free to die. That is not a Christian society, it is not a moral society, it is not a society I choose.

  7. Brooklin Bridge

    This is the sort of thing that absolutely convinces me (each time) that this is all scripted from start to finish, all a play to make Obama’s treachery to the soul of the Democratic party more palatable as we are dragged ever rightward.

    We should be applauding Romney and Ryan’s acting ability as well as their commitment to fleecing the middle class and poor for the benefit of the ‘civilized’ class. To sacrifice their careers like that so that Obama can shine and we can expire; it takes something…

    1. Lambert Strether

      I don’t think that script is precisely the right metaphor, because I don’t think the outcome is fore-ordained in the way that a coherent narrative form would demand.

      I think that it’s a lot more like football, where there are is a league of very similar but competing teams using similar but not identical playbooks, on on “any given day” any team could win. (That is, even though I think Obama’s a mortal lock, players like Rove, for example, may have enough relative autonomy — or believe they have, which in the end might amount to the same thing — based on their factional funding, and their reputational assets, to “turn the game around” with the right play. If so, it doesn’t matter very much from way up in the stands, but it might matter a good deal to the players on the field or the front office.

      But even that metaphor is not right, because the audience, the front office, and the pressbox also have playbooks. And then, of course, there are the owners, who collectively control the field, the teams, the audience, the front office, and the pressbox, but individually or factionally or tribally control only subsets of the players and moreover, are themselves players competing with each other.* It’s a little like the court arena in The Dosadi Experiment or Six Characters in Search of an Author.

      NOTE * In other words, conspiracy theory isn’t just overly simplistic. It’s a category error.

  8. Hugh

    We already have good models for healthcare that work, provide better outcomes, and would cost half as much we, private and goverment, are currently spending.

    Both France and Australia have highly regarded Medicare-for-All type systems where the government is the primary payer but the providers, the physicians, are private.

    Such systems are much more economical because they concentrate on primary preventive care, can provide drugs at lower cost, and have much lower overhead costs generally. Participants know they are covered and that removes a great psychological and financial burden from them, which in itself is quite therapeutic. Preventive care is less sexy but substantially cheaper and more effective in keeping people healthy.

    Acute care which is a hallmark of our system is vastly more expensive. You can call it rationing but how many heart lung transplants can we afford each year? Similarly, in Medicare a big chunk of the elderly’s costs come in expensive hospitalizations in the last few months of life. Futile heroic interventions are just that: futile. And there are few places colder and more inhumane to die than a hospital. On the other hand, hospice care can be a wonderful support to both patient and family, and costs a lot less.

    1. LucyLulu

      I don’t know much about Australia but France would make an excellent model for the US to base their new healthcare system upon. In addition, in France, if one desires additional bells and whistles to what is provided by the government, one can buy private insurance to supplement coverage. The government still pays the same portion for those with private insurance but the private insurer picks up any excess costs, thus private insurance remains relatively reasonable. Two of my relatives are physicians in France. Based on their lifestyles, apparently physicians are also well-compensated in France compared to their peers (own their own homes, large ones with extra amenities like ice in door refrigerators), though perhaps not to the same degree as their U.S. counterparts.

  9. LeonovaBalletRusse

    Who will lay the ax to “Government-funded” Medicare and Social Security is a red herring. The POINT is that the .99% Agents of the .01%DNA Global “Nobility/Royalty” Reich are DETERMINED to DELIVER these Cash Cows into the .01%DNA Private Profit System for THEIR SOLE PROFIT, with all permutations and probabilities DERIVING from this System Slush Fund delivered for exponential profit unto “infinity” for the 1% Total Extraction from the 99% “wealth” and “potential wealth.”

  10. rotter

    Hasnt this come up before? Ryan isnt the only member of congress to have carried out these (insider?) trades. Ryan is an asshole but he is in no way a special case. Hes as much a run-of-the mill representative of the american overclass as anyone could have picked. His right wing ideological posturing and the policies he advocates are not much different than any other DC politician – including most all of the democratic party, including obama.

  11. LucyLulu

    Was it here that a link was posted with Ryan’s trades for 2008? He traded bank stocks most months between the 18th and 20th, either selling or buying the major financial institutions such as GS and Citi, so the Sept. 18 trade didn’t stand out as being out of the ordinary. They were all relatively small trades, buy one month, sell the next, buy back the following. IMO, it looked like his broker was earning commissions, as commissions are high (as percentage) on small trades assuming he used a full service broker.

    However, aren’t our Congress members allowed to trade on insider information? Congress passed laws prohibiting members of other groups that might be privy to the same information from trading on that information, e.g. Defense staff, but Congress voted against legislation that would prohibit themselves from trading on the same information. IIRC, they claim the information they have doesn’t give them any advantage however a look at their past trades demonstrates that they have consistently beaten the markets. It’s one more perk of being a member of Congress that allows them to pad their income, and ensures our legislators will belong to the 1%, and thus be motivated not to act against the interests of that class.

    1. MLS

      Lucy,

      There are links all over detailing Ryan’s trades, one was embedded in a post Yves did a few days ago in an article from Lynn Parramore (think I got that right). You are correct that he was trading in and out of financials around that time, and there’s nothign special about the GS trade. I’ve looked at it pretty closely and the actions don’t look like insider trading (you can see my comments in that Parramore post on NC for more details on why I think that). If Ryan is using a full service broker and paying huge commissions for small trades, he’s dumb for doing so.

      You are also correct that insider trading was legal for rep’s of Congress at the time, but while it’s not a felony, it’s still slimy and generally unethical.

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