10 November 2017

Dear Interested Readers,


Comments and Confessions

One year after Donald Trump’s electoral college victory, some of the shine is gone, as the voters in Virginia and New Jersey demonstrated on Tuesday. Just before the election The Pew Research Center published an extensive analysis of the decline in the public’s confidence and approval of the president. The Pew report also notes that the president’s remarkably low approval rating of 34% and high disapproval rating of 59% is much better than the 22% approval rating of Republican members of Congress. At 29%, Chuck Schumer, Nancy Pelosi and their Democratic congressional colleagues don’t do much better.

Despite the overall decline of enthusiasm for the president, his core supporters are trying to keep their spirits up by accepting his analysis that his failure to deliver on the promises that he made is not his fault. Some join him in blaming a hostile media, and some decry the lack of leadership and coordination between Republicans in Congress. Many staunch Trump supporters feel that Paul Ryan and Mitch McConnell are always a few sandwiches short of what is necessary for a good picnic. Many of his supporters seem to be as blind to his demonstrated deficiencies for office as he is. Both the president and his fiercely loyal base seem to lack an awareness that much of his failure is attributable to his own attitudes and actions. NPR ran a segment this week that featured interviews with some of his supporters a year after the election. Whether you listen to the five minutes of interviews done by Don Gonyea or read the transcript, there is no doubt that even though only 34% of the country approves of his performance in office, the majority of those who do, are still drinking the Kool-Aid and expect that he will eventually accomplish what he has promised them.

On one level it is easy to understand the continued support of those fearful of losing ground to globalization and automation who were drawn to his promises of walls, severed international agreements, jobs returned from overseas, isolationist foreign policy, and the twisted concept of “America first.” Many of them don’t feel that America is still great for them. His “dog whistle” support of a return to white supremacy does not surprise me. What they feel is real. Angus Deaton and Anne Case have documented both the loss of wealth and health for middle aged white men in America without a college education. Imagine their anger if middle aged white men knew that they are the only demographic group in memory to have their life expectancy go down!

What surprises me most is that the majority of true conservatives, people who say that they understand finance and international affairs, and who are responsible people, have remained in line and not spoken out about actions that threaten international and domestic safety and stability. Former Virginia Congressman Tom Davis, a Republican, told NPR on Wednesday, the day after the election, that Republicans were often afraid to speak out against the president because of the power of Trump voters in the primary election process.

There are currently 239 Republicans in the House and 52 in the Senate, and most of them are in relatively safe states and districts where they are less likely to feel the wrath of Trump voters in a primary. You could count on your fingers alone the number who have registered any concern about the president’s pursuit of policy or his behavior in office before Tuesday’s elections. The three most prominent objectors, John McCain, Jeff Flake, and Bob Corker will not be running again. One wonders if anymore of the other 288 Republican members of Congress will be reassessing their position now that there is some objective evidence of the willingness of the disapproving 59% of the electorate to register their opinions via the ballot box.

One of the greatest political curiosities of the last seven years has been Maine’s Governor Paul LePage. He has never won a majority of the votes in any election, but as governor he has successfully denied the citizens of Maine the benefits of the Medicaid expansion offered by the ACA against the majority opinion in the electorate and the legislature. After his fifth veto of the recurrent bill passed by the legislature that would accept the ACA’s Medicaid expansion for over 80,000 Mainiacs, proponents of expanded coverage got the question on the ballot for the election and it passed! As a man of deeply held conservative principles, Governor LePage is now trying to figure out how to further avoid the will of the voters. He claims he will continue to block the $500 million dollars of government support that the Medicaid expansion will provide Maine until the legislature comes up with the state’s $50 million dollar share of the bill for Medicaid expansion.

The most significant news of the week occurred in a little white church. From a tiny crossroads community in rural Texas we heard that same old familiar sad song that we heard a month ago at a concert in Las Vegas. We have heard it in schools. We have heard it in movie theaters. We have heard it on college campuses. The “after story” unfolds pretty much along a plot line we have also heard too many times. Nothing happens and then a month or so later we hear the song and hear the story again.

Perhaps I feel more connected to this last shooting because at the same time it occurred I was attending services with my wife at my own little Baptist Church in New London, New Hampshire. Every Sunday since 1826 the congregation has met in the same white church with a towering steeple that sits near the center of town between the gazebo on the town green and the little college that the church helped to start.

I write to you now from Lincoln County, North Carolina where my mother’s family has roots that go back to pre revolutionary times and our ancestors were founders of the Baptist church where my parents were married, and where years later my Dad was twice the minister. Lincoln County has 80,000 residents these days and 59 Baptist Churches! Many of those little rural Baptist churches “out in the county” are very much like the one in Sutherland Springs.

These recurrent horrific events that seem to occur now more often than the seasons change must be a function of some dark aspect of our collective psyche plus the ubiquitous nature of firearms in our society. We have some hard to explain vestigial fascination with firearms, coupled with a vulnerability to technology that delights a few of us with what is bigger and more deadly while making us all vulnerable to avoidable tragedies. At first, after each new episode we hear much about “thoughts and prayers.” We are told that it is “too soon” to discuss issues of cause or prevention. Eventually, the emotional momentum for change fades like a passing wave of GI distress, and we go our different ways until the song is sung again, followed by the candlelight services and the “thoughts and prayers.” The new wrinkle this time is that there is a scapegoat. We can blame the ineptitude of the Air Force which frees us from some of the burden of asking, “What part of the problem am I/ are we?”

The prime subject of this week’s letter was a challenge for me because I know very little about taxes. I pay them. I have always assumed that everyone can build a case for why they should pay less. I also figure that some people cheat and don’t pay theirs, and that others use their influence within the political process to have the laws written in such a way that reduces their taxes without “cheating.” Without any personal effort I was along for the ride and benefited greatly from the redistribution of taxes affected by Reagan in 1981 and 1986 and Bush in 2001 and 2003.

I’ve used the same accountant for over forty years and he made sure that I got every penny of benefit that these laws offered. In the seventies I was audited twice because I took large deductions for medical expenses while I was doing a psychoanalysis. Because I had a good accountant my deductions were proper and no taxes or penalties were due. After two audits that went well, I would never change accountants. Changing accountants would be like leaving a doctor who had saved your life. When thirty years ago my accountant decided to move his practice to Maine, my business went with him. Now, I sweat when I think that he might retire. Our relationship is built on my trust in his expertise and the ability of my wife to feed him data. I just sign the forms. We live by his professional opinion. We write a check when he says to, or we joyfully receive a refund if he says one is due.

I have never voted for a politician who promised to lower my taxes. It has been my bias that political promises to lower taxes were invitations to join in the mugging of the less fortunate. Quite irrationally I like the idea of avoiding deficits. Deficits are usually blamed on too much social spending, though it seems to me they occur when we fail to levy enough taxes to cover the cost of the legislation that we passed. Despite those opinions, after I cast my vote I have quietly accepted whatever the politicians give me.

I need to change by applying the same effort and resistance to harmful tax policy that I apply to harmful healthcare policy. I hope to demonstrate that it is irrational to fight for better healthcare and to advocate addressing the social determinants of health and simultaneously be silent when tax policies are offered that undermine our ability to improve our collective experience. With these confessions it should be obvious that to write about the tax proposals now being considered in Congress I needed to do some reading. I hope if you are too busy to spend a lot of time in your own research what is offered below will be worth your time.

Last week’s letter generated a few comments. You might remember that I began the letter with:

I have been trying to remember a song, probably an old country classic, that has the line “...there are thoughts that I ain’t thunk…” I thought it was a Kris Kristofferson line, and maybe it is. Let me know, if you know. My search came up empty, but it was fun.

An “Interested Reader” who is a talented and experienced physician executive in a mid Atlantic state wrote to tell me that it was a line from Kristofferson’s “Best of All Possible Worlds” written in 1970:

There’s still a lot of drinks that I ain’t drunk
And lots of pretty thoughts that I ain’t thunk
And Lord there’s still so many lonely girls
In this best of all possible worlds.

If you clicked on the link, I hoped that you enjoyed the song. I had forgotten the line that also connected to last week’s letter:

That police man said, "Mister Cool, if you ain't drunk, then you're a
fool."
I said, "If that's against the law, then tell me why I never saw
A man locked in that jail of yours who wasn't neither black or poor as
me?"

A second Interested Reader who is an African American physician from the South wrote to tell me about his first experiences in practice in a small town in a state above the Mason Dixon Line.

I moved there right after residency with my wife and two kids (black). It was a bit of a culture shock ... I think I may have been the first black doctor there as many of the older white patients that I cared for had no problem extended a 'compliment' to me for caring for them in the hospital, then back in the clinic by saying 'Doc,’ I don't mind that you're colored, you’re a good doctor'.

Growing up in the South (small town in the 70-80s) I had antibodies to things like this so it was taken as I believed they meant it...'in the spirit of thanks'. So I would just respond graciously, "Well I'll take that as a compliment Mr. Confer, I definitely don't mind having older white males as my patients...or I'd probably be out of business" ...we'd share a laugh briefly while their family or kids would flush with embarrassment at their father/grandfather's 'compliment'!

This was in 2003!

This week I have been in North Carolina where my 97 year old father is recovering in a rehab facility from two recent hospitalizations for G.I. bleeding and aspiration pneumonia. His hospitalist on both recent admissions at the local hospital which is part of the massive Carolinas Health system was an African American physician from Queens in New York who received his medical education at Wake Forest. That reality represents evidence of change, but as I travel to and from the rehab facility attached to the beautiful assisted living community where Dad lives and is getting amazing care what I see says we have a long way to go. I see fences, flag poles and pick up trucks around rural homes that proudly display the Confederate flag. There is no way that I can know for sure what the motivation for the display is, but I can’t help but think that if my friend the doctor were riding with me he would see a South that in many ways would still test his “antibodies.” We do not yet live in a “post racial” world, and I believe that reality diminishes our collective health. There are still unique black, white, and immigrant experiences in America, and each individual’s health is profoundly affected by the group into which they have been slotted by factors determined centuries before their birth.

A third comment comes from an experienced physician leader in Connecticut who suggested two resources that connected to the Yuval Noah Harari observation:

What we are talking about in the twenty first century is the possibility that for the first time that most human beings will lose their economic and political value. They will become a kind of massive useless class. Useless, not from the viewpoint of their mother or their children, but useless from the viewpoint of the economic, military and political system. And once this happens the system also loses the incentive to invest in human beings. In the twentieth century governments all over the world, even in dictatorial regimes, invested heavily in the health, education, and welfare of masses of people because the government and the elites needed them.

The good doctor suggested:

If you get the New Yorker, a recent issue with robots on the cover contains a very moving article about the current and not so far in the future impact of automation. It is worth a read.

Your understanding of the pervasive, unresolved issue of racism brings to mind Bryan Stevenson. His book Just Mercy is worth a read or the Ezra Klein podcast on him is very moving.

I read the New Yorker article and it is terrific. Just Mercy has been ordered from Amazon, and you must hear the podcast.

If you missed reading last week’s letter, you can catch the abridged version as the posting on Strategy Healthcare. Your comments on these letters mean a lot to me. They serve as a continuing encouragement to keep up the effort. Every comment generates a conversation that is a chance for mutual growth.

How the Proposed Recent Budget and Tax Bills Can Affect the Future of Health

I am the last person who has enough interest and knowledge of taxes to write about tax policy. I know that taxes have a long history. You can read about them in the Bible. When Christ was asked about taxes it is recorded in Matthew 22:21 that he famously responded:

..."Render to Caesar the things that are Caesar's; and to God the things that are God's.

As wise as that sounds, I think that it needs to be coupled with Chapter 25 verse 40 of the same gospel of St. Matthew to give us anything close to an operating principle:

And the King shall answer and say unto them, Verily I say unto you, Inasmuch as ye have done it unto one of the least of these my brethren, ye have done it unto me.

I have come to believe that this observation cuts both ways, the accounting includes what we have done and what we have neglected to do. It may be a reach to attach it to taxes and healthcare without also including the concept of the federal budget. What follows is a retired doctor’s attempt to connect the dots between health, healthcare, the federal budget, taxes, and tax “reform”.

As a disclaimer I should admit that until recently I might have failed the test if asked to describe the difference between a tax deduction and a tax credit. I have heard for years that we should not allow hedge fund managers to be compensated for “carried interest” , but did not know that it was a loophole allowing them to pay taxes on large portions of their income at the lower “capital gains” rate than at the personal income rate that most of us pay on our earnings and that they pay on “management fees.” Did you know that the concept goes back to the sixteenth century shipping trade?

Perhaps I can be excused for not fully understanding “carried interest,” but my face should be a little red for not fully understanding one of the most important tax benefits for the working poor, the “earned income tax credit.” Going back to President Reagan's comments about “welfare queens” many people have imagined that public assistance programs diminish the benefit of work for the poor. It is imagined that they are black, take drugs, and have a lot of babies out of wedlock to increase their revenue from welfare. This week I have personally heard comments from a friend in New Hampshire and family in North Carolina that suggest that the antipathy generated by those “dog whistle” comments about “welfare queens” still exists. Myth and bias seem to be fundamental to much of our current tax code and our budget allotments and my cynicism prevents me from trusting that fixing these defects is what is meant by our president when he says that we need “tax reform.”

The “earned income tax credit” , EITC or EIC, is a refundable tax credit for working poor individuals and couples, particularly those with children. The size of the credit is a function of the number of children or legally qualifying dependents that the “taxpayer” supports. The EITC may produce a “tax refund” which becomes an incentive to earn more. Until maximum payments are achieved there is always an incentive to earn more and a disincentive to “go on welfare.” Some sociologists and economists consider the EITC to be the most effective tax policy ever created in our efforts to lift people out of poverty. I consider it to be a very small step in the direction of reducing inequality. Some economists believe it is more effective than raising the minimum wage. The combination of raising the minimum wage and strengthening the EITC seem like a dynamic duo worthy of further consideration.

To really explain this moment in our collective history when we are told that job creation urgently depends on tax reform that will substantially benefit the already richest members of our society, I must digress to be sure you understand the arcane rules that govern the methodology of how a bill passes in the Senate. As you probably noticed in the debate over repealing and replacing the ACA, to avoid a filibuster in the Senate there are two choices. The best is to have 60 votes (it was once 67). The alternative process is to use a financial “reconciliation” process to pass the bill with a simple majority of 51 votes. President Obama used a variant of this mechanism to “fix” the original ACA that was passed after Scott Brown, a Republican, was elected to fill Ted Kennedy’s seat.

In terms of the process before us now, to qualify for the “reconciliation” pathway, the current tax reform package must not produce more than a 1.5 trillion dollar additional deficit before 2027. The full wish list of proposed giveaways to the wealthiest Americans and corporations will be many multiples of that number. The way around the roadblock is to come up with a deceptive package of gives and takes sold under the banner of “creating jobs” and prosperity by making the rich richer with the hope that folks and corporations already flush with cash will take this new cash and invest it in expanding the economy by growing industries that need more workers than robots. It is possible that those new jobs, if they do get created, will generate tax revenue that more than replaces the tax reductions that were the seed money for the economic magic trick. This is Laffer Curve economics 2.0, or perhaps it is a modern equivalent of alchemy. Fool me once shame on you. Fool me twice shame on me. Fool me three times shame on both of us. Click on the link to experience the wisdom of Donald Trump.

As the conversation in Washington has shifted from healthcare to tax reform, the discussion seems to center around how tax reform will affect the middle class and whether or not the majority of benefit going to corporations and the wealthiest will ever benefit the rest of us. As I listened to reports and read articles in the newspapers, I was impressed that there was little if anything being said about what the impact of the proposed budget on the poor would be that would allow the reconciliation process to work. If the middle class has financial woes worthy of concern, what about the poor? This week the Commonwealth Fund did venture some thoughts on how tax reform might impact healthcare. Their analysis was depressing. You should read it but here are the highlights:

The attempts to deeply cut federal healthcare programs are not over.

1. First, some conservatives in the House and Senate remain committed to including ACA repeal provisions in the tax bill. And, while they initially lost in their efforts to attach a repeal of the individual mandate to the current House Bill, conservatives may withhold support unless such a provision is included in the final bill.
   
2. Second, the House tax proposal is expensive: the proposed tax cuts total $5 trillion. The budget resolution Congress passed last month allows up to $1.5 trillion of the total cost of the tax cut to be paid for with an increase in the federal deficit. This shortfall will go up over time. After the fights over which middle class deductions will remain, the only place to go that allows tax breaks for the wealthy and some relief for the middle class will be to gut entitlement programs. Key targets would be cuts to Medicaid and Medicare. 
   
3. [Quoting directly from the paper] Third, tax reform may ultimately affect access to health care in the not-so-distant future, even if specific health provisions are not included in the bill. Should it pass, the ballooning federal deficit that will follow its implementation will invariably lead to calls to reduce federal spending. Medicaid, Medicare, and ACA coverage will again be in the crosshairs given the portion of federal spending — 28 percent in 2017, growing to 40 percent in 2037 according to the Congressional Budget Office — these health programs represent. 
   

Perhaps after those direct cuts to healthcare the next options could be those programs that form part of the social safety net like the food stamp program, the earned income tax credit, perhaps student loans, or other programs for the education and the retraining of the workforce. What about money for the opioid crisis? Your guess is as good as mine, but you can expect the cuts will come from places where the defense is weakest.

The favorite line of many football coaches is, “The best offense is a good defense.” I like the admonition from the distant past of medical professionalism that advises primum non nocere, above all do no harm. I think it is necessary for emphasis to put it into a more modern vernacular, “If you really are not sure what is going to happen, and the stakes are high if things go bad, don’t chose to do it and fight anyone who is crazy enough to try it.” That is where I stand on the tax reform proposals that have been presented so far. I admit that most of what “I know” may be flawed, but I know enough to know that the people who say they know what they are doing actually don’t. I am sorry to be cynical enough to say that their primary motivations seem to me to be self serving, but I can’t help it, and I hope that you will give the whole subject your interest and then speak your mind to somebody who has a vote.

Sweet Memories

The gorgeous fall that seemed to end this last week is quickly becoming a sweet memory. The picture in today’s header was taken back in mid October. It is a screenshot that I made from a video that one of my neighbors made earlier this fall using a drone. The whole three minute video is beautiful and all of the scenes are from the general environs of the beautiful place where I am lucky enough to live. f you want to see the whole video, just click here.

Now the leaves are either down or brown, and the temp dipped below 20 last night. The day is gone by 4:30 which means you have a shorter window during which to get some fresh air this weekend. I hope that you will get out for a walk. Let me suggest that you take a long walk, and listen to the podcast that the Interested Reader from Connecticut suggested. I did on my walk yesterday, and it may have changed my life. As mentioned before, it is a conversation between Bryan Stevenson, activist lawyer and author of Just Mercy and Ezra Klein of Vox.