A few times a month I see a neighbor walk out of my apartment complex and get in his car. I keep walking towards the metro stop while he drives off to work. A very typical boring morning in the land of Wages. The one catch is that the car is an official government vehicle emblazoned with the metro logo. He often parks the car within 15 feet of a metro bus stop that goes directly downtown towards his office. And the metro rail station is 3 blocks away. But he drives towards downtown everyday, rejecting his own system.
"As far as Athens is concerned, I also think about all those people who are trying to escape tax all the time. All these people in Greece who are trying to escape tax, I think they should also help themselves collectively by all paying their tax. Yeah." This is a quote from the Managing Director of the IMF, Christine Lagarde. And I think she’s totally right. Greece’s fiscal situation is not an acute ailment, but a chronic illness that has been growing for decades. They are unwilling to pay for the government they want, or cut the government to the level they are willing to pay for. And cooking the books worked only so long before the EU demanded to take a peek. Her point is right on. Except that Ms. Lagarde makes $467,000 per year in public monies, and pays exactly $0 per year in taxes. “All those people…” includes herself.
From: Bryant Hall
To: Billy Tauzin, Neal Comstock, Mimi Simoneaux Kneuer, Ken Johnson
Here's the stuff. Background is that Pres's words are harmless. He knows personally about our deal and is pushing no agenda.
We got Orszag to back off of the Part D rebate—and Nancy-Ann and Jim Messina beat the hell out of them. . . .
This is part of an email from the lead negotiator for the Pharmaceutical lobby to Pfizer executives, summarizing the state of negotiations with the White House during the 2009 drafting of the Affordable Care Act. Pharma was very concerned about a few options the White House was throwing around, including: rebating back some of the government’s costs under Medicate Part-D, opening up the prescription drug market to global markets and permitting cheaper imports into the U.S., or allowing the federal government to negotiate drug prices in Medicare and Medicaid charges. All of these would of course have numerous effects, among them reducing costs for both patients and taxpayers, advancing free-market principles in the healthcare sector (after all, making it illegal to discuss drug prices is sort of not so free market), and opening up choice and competition for consumers. It would also so threaten Pharma’s profit margins that they relentlessly beat down Administration proponents. And put up $80 billion in cost-sharing for Part-D. A onetime band aid that will be burned through quickly in the giant healthcare business. A far cry from the systemic changes they defeated. Changes that would be just as effective, if not more so, in 30 years as they are now. That $80 billion will be ancient history in 30 years.
Three vignettes on why people are frustrated with government.
It’s common lingo in the public sector to speak of the government in a corporate sense. “We strive to provide great customer service.” “We need to take a corporate view and identify efficiencies and cost savings.” “I really appreciate his focus on the customer.” These are common refrains within government. In these little bureaucratic aphorisms one senses not just a little envy. Profit envy yes. And also presumably about how much more free corporations can be compared to government, in the sense that their every reason for existence isn’t dictated and limited by a statute like in a government agency. But in fact, governments share very little in common with corporations, other than the fact of being a large body of people all working towards the same general mission (at least some of the time). Governments don’t sell anything. They don’t make profits. They don’t pay taxes. They don’t have a corporate board or charter, they don’t even have a product. And they certainly don’t have customers. They don’t have cash flow. Or a real balance sheet (real in the sense that there are returns to capital that accrue as profit, or losses). They don’t have shareholders or people with actual equity in the operation. They also don’t have unyielding, absolute guiding principles like corporations and private actors, as these three examples illustrate.
Government don’t have to use their "product". But Coke executives don’t drink Pepsi. Yet metro takes a Chevy to work. They don’t have to do as they say. They can write laws that exempt them from their own standards. Members of Congress don’t have to adhere to insider trading laws and IMF leaders don’t have to pay taxes. Apple and Dell and Exxon do. And the “profits” government protects for its “customers”- which I suppose, forcing this corporate paradigm, would be something like how much of a paycheck is left at the end of a month for a family on Medicaid- aren’t ever realized by the primary actors like in corporations. The difference in the healthcare negotiation is that one side had a ton of money that would go to their bank, or not, based on the deal- the other didn’t stand to win or lose anything itself. Its “customers” are always somewhere else. And so the private actor focuses like a laser on its interest while the government has no clear overarching interest to protect. It’s a political octopus. Which side wins?
This isn’t a defense of corporations or government. It’s a tiny look I think at why people fundamentally can’t ever totally believe in government.
