Corporations and governments: can’t have one without the other

Considering some of the shouting, one might think that politics has divided into two camps: government is bad and corporations are for the common good, or corporations are greedy and government is for the common good.

As too often is the case, the truth lies somewhere in the middle.

First, let’s look at the similarities.

Corporations and governments are organized by people for a large number of reasons.  The people who organize these entities do so to provide goods and services, to make money, to be famous, or to push certain views, both altruistic and selfish.  Neither type of organization is any better than the people who run the organization.  Success depends more on the leadership and the resources available than on the form.  Success also depends on the circumstances of the time.  If a large segment of the population is not interested in an idea, it will take a lot of effort to promote the idea, whether a new product or a new law.  On the other hand, if a very large segment of the population is interested in an idea, somebody in corporations or government will be working overtime to fulfill the population’s wishes.

The big difference is that the corporations are run by the few and governments are run by the many, if the many show up and vote.

As many misinterpret Adam Smith’s “invisible hand”, many misinterpret Milton Friedman’s the only purpose of a corporation is to “increase profits”.

“[t]here is one and only one social responsibility of business–to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud."  - Milton Friedman, “The Social Responsibility of Business is to Increase its Profits”, The New York Times Magazine, September 13, 1970

Many interpret this as the only purpose of a corporation is to increase shareholder value.  Unfortunately, they ignore “rules of the game” and “without deception or fraud”.  But what is shareholder value?  Is it a continued gain in stock price?  Is it a continuous stream of increasing dividends?  Or could it be the long-term provision of a good or service?  For example, do investors want to create a product that could take years to bring to market?  Do investors want to insure that medical services can be provided to a community for decades rather than maximize profits for the short-term and destroy the community long-term?

Many point to the problems of MNSure and ObamaCare as examples of government inefficiency.  But guess who provided the computers and software for these health insurance programs?  Private companies!

And private companies have not been known for efficient, trouble-free rollouts of new products.  How many auto recalls are there every year?  Has every computer program or system you purchased or downloaded been free of bugs?  It seems every time I get a notice of an app update, the description includes “bug fixes”.

In the “bad old days” of mainframes, it was really a major milestone when a computer ran a whole day without a crash.  Now things are much better.  My laptop, which is more powerful than any mainframe I worked on, might go a whole week without some kind of frustrating error, including freezes.

MNSure and Obamacare are massive systems requiring massive co-ordination of many pieces.  As we don’t give up on our computers, we shouldn’t give up on massive projects that don’t work perfectly on the first day.

"I'm as confident of this as I would be that when the first cars didn't work well, it wasn't time to return to horses and buggies; it was time to improve the cars. This is the new technology; there are kinks to it and it's going to take some time to work them out.”
Joel Ario, quoted in “Contractor’s report slams MNsure weaknesses, readiness”, Elizabeth Stawicki, MPRNews, 2014-06-18

Are you collecting Social Security?  Is your check posted to your bank account on the promised day every month?  But it was not always so.  Like getting computers to not crash, the rollout of Social Security was not without glitches or without critics who claimed dire consequences.  Like “nationalization of wheat fields would soon follow” and Americans would be reduced to passive servility.  It would take forty years of tinkering to have ninety percent of Americans covered by Social Security.

See “What about Social Security’s rollout?” Bruce J. Schulman, 2013-10-29, Reuters

An interesting contrast to the call for less regulation and taxes is the call by some of the same people for government subsidy.  How many stadiums for billionaires have been built without government subsidies?  How many companies have chased after the best subsidies and tax breaks to determine the location of a new office or factory?  Are these the same people who say government shouldn’t be picking winners and losers?

Consider the big howl from Congress when Solyndra collapsed.  But nothing was said about the success of Tesla.  Both received start-up subsidies from the Federal government.  Tesla paid its loans back!  Also among those who received subsidies were Compaq, Intel, and Apple.  Now Apple is the largest company in the world in capitalization!  And looking for ways to avoid paying back its benefactor through taxes.

For a lot more on how government has fostered many other successful innovations, see “The Innovative State: Governments Should Make Markets, Not Just Fix Them”, Mariana Mazzucato, Foreign Affairs, January/February 2015.

- Mel wishes a few far-sighted Republicans and Democrats would start a Pragmatic Party.

This was also published in the Duluth Reader, 2015-03-26 at 2015/03/26/5005_corporations_and_governments_cant_have_one_without

As seen on the web is as authoritative as seen on TV

“As seen on TV” as an endorsement of a product always gives me a chuckle.  So what if the product was shown on TV.  It was only there because the seller bought ad time.

“I read it on the web” is even more insidious because we have no idea what the source was and how reliable the source is.  One of the latest stories is that a three-year-old girl and her grandmother claimed they were asked to leave a KFC restaurant because the girl was severely disfigured by dog bites; the other customers “would be upset”.

Counter evidence includes no meal as described was on any register, no security camera shows the two, and the named restaurant had been closed for some time.

See http://dailycaller.com/2014/06/24/report-story-of-toddler-tossed-out-of-kfc-is-a-complete-hoax/

Of course, all you have to judge this is my little entry and the above web site.

Whatever, investigate a cause before you send money or sign a petition or forward a link.  Always!

Quotes of the day: Vaccination, personal choice, and public health

“The lesson of all this is that vaccination is not an individual choice to be made by a parent for his or her own offspring. It's a public health issue, because the diseases contracted by unvaccinated children are a threat to the community.”
- “The Toll of the anti-vaccination movement, in one devastating graphic”, Michael Hiltzik, Los Angeles Times, 2014-01-20

“The old line about a lie traveling halfway around the world before the truth can get its boots on certainly applies to the supposed link between autism and the MMR (measles/mumps/rubella) vaccine -- in spades.”
- “More on the unsavory history of the vaccine-autism ‘link’", Michael Hiltzik, Los Angeles Times, 2014-01-22

I wonder how much social media like Facebook give lies the wings to go around the world.  I see so many postings about cute stuff, clever stuff, and outright nonsense that ask readers to pass them on.  I don’t because I don’t want to bother, I don’t think all my friends don’t need to know those things, or I don’t think they are posted with any critical examination by the poster.

Serendipity strikes again!  Clearing up some Firefox tabs, I wound up finding:

“The charter school textbooks breezily dismiss evolution as “an unproved theory.” Here’s where inadequate science education and fundamental science ignorance show themselves. Science uses the word “theory” the way the rest of us might use “conclusion.” A scientific theory sums up hypotheses that are themselves backed up by testing and observation.”

and

“Ignorance is curable by education, but willfully ignoring the facts can be contagious — and even fatal.”

- “What creationists and anti-vaxxers have in common”, Patt Morrison, Los Angeles Times, 2014-01-23

Frunds in the bank?

I received an email today with the subject "RE: FRUNDS IN THE BANK!!"  This has to be spam!  "Re" for a subject I never used in email.  All caps.  Double exclamation marks.  And the sender used the title "Mr."  How many emails do you send with any of these in the header?  Maybe caps once in awhile.  "Re" only generated automatically when you respond to another's message.  Misspellings!  Lot of us make typos that we miss, but "FRUNDS".  Could this be a Freudian slip; the writer meant "FRAUDS IN THE BANK"?

Microsoft Outlook allows me to peek at the text of a message without opening it.  Sure enough, the writer has carefully investigated me and would like me to assist in a money transfer of several millions of dollars.  Gosh!  If he claims to be with a Hong Kong bank, doesn't the bank have the connections and resources to transfer large sums of money without calling on complete strangers, by email no less.

I wonder how long my list of blocked senders has become.  I block at least four a day from all over the world.  I wish I would get a commission from all those vendors of email addresses.  They could easily do it by putting my commission in my PayPal account.  As far as I know, I'm the only Melvyn Magree.

Health care or wealth snare

The following are notes I took this morning on a presentation on health care fraud titled "Lifting the veil:  The Citizens Federation’s discoveries of financial mischief by insurance executives and regulators".  It was given by Buddy Robinson of the Citizens Federation at the Lake Superior Freethinkers meeting.

His talk was based on "Who Is Minding the Store", a report by the Citizens Federation.

Added up numbers and found that non-profits took profits.  Put into reserves which became excessive – twice the safe amount and four times the required amount.

Reserves went into investments which in turn increased reserves.  Insurance companies didn't report this to Minnesota legislature.

Several Minnesota counties are dealing directly with the state for employees' health care.  Some are now considering opening to public.

Strange things found about financial reporting.  CEO compensation reported at half actual - Health Partners

Money from state increased at greater rate than payments to providers.

Overpayment reimbursement not in contracts but if fraud involved then overpayments can be recovered.

Insurance companies don't want to divulge payments to providers.

State allowed companies to police themselves.

Motivation?  Medica contracts with former parent UHC, giving it 2/3 of income.

Insurance companies use government money to subsidize commercial policy losses.

Private insurance was to save money; it wound up costing a lot more.

Are HMOs too big to fail or jail?

End of my meeting notes.

So much for the efficiency of private enterprise.  Efficiency (sometimes) in lining corporate management pockets!

I gave as my comment Adam Smith's "The proposal of any new law or regulation of commerce which comes from this order…"  See "The Invisible Adam Smith".

Report spoof email as often as you can

It seems that every day I get some spam that intimates that it is from a major corporation and that my account has been compromised. I report almost every one of these to the spoofed corporation (if I've found an email address for such) as well as to the Federal Trade Commission (spam@uce.gov) and the Anti-Phishing Working Group (reportphishing@antiphishing.org).

Sometimes it is hard to find an email address for a spoofed company. Somewhere on a home page or a help page you might find a link to spam, spoof, phishing, fraud, or security.

You might think that it is a bit of work to report spoofing, but consider it like calling the police when you see suspicious activity around a neighbor's house. Consider also this statement that I received from PayPal after reporting a phishing message:

Every email counts. When you forward suspicious-looking emails to
spoof@paypal.com, you help keep yourself and others safe from identity
theft.

See also my blog entry Phishing against which bank this week?

Spending can be saving

Many want to cut government spending, sometimes even if would save money. The AARP Bulletin has a couple of good articles that highlight this problem.

See "Criminals Bilk Medicare of billions each year" online, "Busting Medicare Fraud" in print, November 2009.

Four years ago Congress turned down a request for $300 million to track down Medicare fraud. An inspector general said every dollar spent doing so would return $17. Hmm, so not spending $300 million cost $4.8 billion (300 x (17-1)). Million wise, billion foolish?

If crooks bilk Medicare, it's bad, but we don't want to spend the money to catch them. If businesses bilk Medicare, it's OK because these businesses contribute to our campaigns.

Medicare is being invoiced for wheel chairs on average four times the cost paid by suppliers. "Congress blocked attempts to impose competitive bidding." Hmm, competition is good for schools but not medical suppliers. See "The Case of the Expensive Wheelchair". Gosh, I thought it was bad that my daughter was charged twice the amount for contact lenses that the ophthalmologist paid. I wasn't supposed to know this, but I saw the invoice as the receptionist took the lenses out of the shipping container and put them in a package for my daughter.

No spam!!

Yesterday I had not a single piece of spam to my main mail account. Unbelievable! Maybe word got out that I report bank spoofs to the banks and to the FTC. Maybe my name has been taken off the spammers' lists.

But like one cold day doesn't disprove global warming, one spam-free day doesn't prove spam has disappeared. As of this posting I had received one spam today.

Phishing against which bank this week?

This summary is not available. Please click here to view the post.

Iranians cannot feel like the rest of us

For a very moving essay on what it means to be an Iranian, read
Alien Nation, Kamin Mohammedi, Tehran Bureau, 2009-08-01

It is very hard to see all these pictures from modern Iranian cities and believe that the Iranians live with a medieval government. We may believe that our 2000 and 2004 elections were stolen, but no newspapers were shut down for writing that fraud had taken place and nobody was sent to prison for claiming there was fraud.