At 35, I’ve been laid off from 3 jobs - within an 18 month period before I was 31 years old. A single teen parent, I put myself through university in 4 years to earn a BA. I didn’t have parents who could help me. But that’s not impressive. My drive and determination and strength have threatened every supervisor I’ve had to date. Not really laid off - fired for speaking up or standing up for myself.

See I speak truth to power and that’s not good for a career. Today, I’m employed by a leading company that makes hundreds of millions of dollars in profits each quarter, and my “one time bonus” because we had such a great 2007 was $177. Take out taxes - it’s $80. We generate revenues in the tens of BILLIONS! With profits over $800 million in a quarter, the company puts out press releases touting our $2.5 million contribution to charity.

It’s a joke. Brad and Angie pay more out of pocket on tips a year. We need to repeal At Will and instate “just cause” termination. We need to increase UI amounts to account for cost of living and increase the allocated time to what UI was in the 1970s. I’ve seen too many people suck up and become incompetent managers who ruin young people’s careers. I have no hope for this country or its future unless things change: 1. education is funded 2. At will repealed 3. employment litigation stops blindly favoring business at the expense of workers. Need to end the corporatocracy that has infected this nation. Otherwise, remember how Rome fell.

 When I was growing up it never occurred to me that you could have too much education. My parents were first-generation college graduates and this meant they achieved much more than their own parents and grandparents. Going to college was assumed in my home and education highly valued.My brother ended up as an engineer. His four year-degree in a highly technical field made him very employable and successful. My sister finished school eventually with a linguistics degree. Not as practical as my brother’s education but she managed to turn it into a viable career with the government. I don’t know if her job could be called exciting, but she supports her family quite well. Then there’s me.

My first degree was in humanities. Yes, I got one of those liberal arts degrees that meant I could be charming at a cocktail party and hope for a job as a secretary. I managed to postpone all that by marrying and having children and immediately taking jobs that worked around the needs of my children. In all, not necessarily a bad plan…unless you end up divorced.

You know those life event tests, the ones that tell you how many major events in one year will drive you crazy with stress? Within a couple of years both my parents died, my marriage ended and I wound up struggling to survive emotionally and financially. If I’d had the money I could have kept a therapist busy 24/7 for years. Instead I lived carefully to stretch my inheritance as far as I could and then decided to go back to school and get more education. The plan was to make me more employable.

Now, I didn’t decide to get a masters degree on a whim. I had accidentally fallen into a job teaching business classes at a local community college, and I was really good. However, after three years the school came up for reaccreditation and was forced to get rid of all instructors who did not have an advanced degree. So, it seemed a logical step-get the required degree and step into my new career.  After some fumbling and stumbling I found an accredited online school, signed up for student aid and began working on my education again.

What I didn’t realize is that career positions in the community college system are almost impossible to land. Full-time instructors and administrators stay in their jobs until they die. And though the system functions on the use of part-time adjuncts, it’s impossible to make a living as an adjunct.  I graduated with my shiny new management degree, a mountain of student loan debt and no prospects for employment.

I had become “overeducated,” which meant no academic institution would give me a full time job, no non academic company wanted to talk to me and entry-level service type employers just thought I was crazy.  My impressive grade point average and wonderfully written papers meant nothing. After almost two years my masters degree means a mountain of student loan debt I wonder if I will ever be able to pay off and a resume albatross.

When you’re overeducated and unemployed there are a few commonly held beliefs that make your life quite miserable. Here are a few of the most frustrating.

People assume that you just won’t take certain kinds of jobs. I have been getting advice for years on how I should just be happy to “take anything” to get started, and since I’d been out of the workforce for a while I should be grateful to have a job-any job.  These well-meaning folks seem to be under the impression that this thought has never occurred to me. They see me sitting in some unemployment ivory tower where I only apply for perfect positions, content to take nothing at all rather than “settle.”  Explaining to my friends, family and acquaintances that I really will take ANY job remotely near my home makes me feel even more pathetic.

Employers who do interview me assume I will leave for a “better opportunity.” There seems to be a huge disconnect between employers and human resource professionals and the job-seeking public. Sure we’d all like to have a dream job some day, but while I’m waiting for that day I’d like to be able to pay my electric bill and eat something besides instant noodles. Really, where are all these better opportunities that I am supposed to be jumping on anyway? If they were that easy to find, don’t you think I’d just skip the middle phase and go straight to the dream job? Maybe it’s just politically incorrect to discuss the NEED to have a job that pays a living wage. Ok, employers want certain skills-fine. I’d like to do work I enjoy (or at least don’t hate). But more important than any of that, I want to stay off welfare, keep a roof over my head and know I won’t spend my retirement years living in a box somewhere.

Scam artists and multi level marketing types assume that unemployment means I have either lost my intelligence or my ethical bearings. True, many days I am desperate. However, I know that there are no businesses that can guarantee fast wealth, and tricking people into a scam is bad for you.  Either you get caught and punished or the bad “karma” wrecks your life later. Yes, I need work and yes I’m willing to “think outside the box” but I am not willing to lie, cheat and steal-not yet.  Oh, and I can tell the difference between a real job and a come on so stop wasting my time.

If you aren’t working now or have a “spotty” work history there’s something wrong with you. When HR people reduce you to a standardized form they really miss out on lots of valuable information. Most application procedures and websites are obviously constructed for the convenience of the screeners and with the assumption that all applicants will fit a preconceived form. So the part-time, seasonal and parenthood or lay-off interrupted career looks substandard because it doesn’t fit the forms. Just because you haven’t been lucky enough to find a great career path yet doesn’t mean you lack talent and potential. It does mean that employers will have to spend the time to look below the surface.

 America is in for a hard time if we don’t smarten up. While India and China are expanding higher education opportunities we are kicking our educated professionals in the teeth.  Not only do we run the risk of losing out in the global marketplace, but we are creating generations of depressed and desperate job seekers. These people make prime targets for scam artists. The overeducated and underemployed may end up overusing their credit cards or moving back home to live with their parents. So, I beg you HR professionals, before you utter the words “overeducated” or “overqualified” again-think. Think about the talent and skills you are passing up. Consider the professional who will work for you with enthusiasm and loyalty because you could see past the standardized form. Ponder what you would do if suddenly you found yourself downsized or laid off…and “overeducated.”

About the author: Karen Southall Watts has been teaching business and entrepreneurship since 1999. She is a veteran of marriage, divorce, long-distance relationships and being overeducated in the American job market. Karen’s latest workbook “Sex is good for business-a workbook for couples in business” is available through www.sexisgoodforbusiness.com or by emailing the author directly at KSouthall2@gmail.com

I’m a 48 year old, African-American male, with a Masters in electrical engineering, and I’m currently looking for work. This is the third time I’ve been laid-off and I am no longer considering full time employment as a possibility. My focus is on contract only positions now because all of the jobs I’ve held since I left the telecommunication industry have been, ultimately, temporary anyway.

What are the characteristics of recent terrorists? “Desperation … Occupational opportunities are extremely limited. … Come from upper and middle-class families. … Have some college education …. either professional or semi-professionals … solidly anchored in family responsibilities … married and … have children.”¹ Does this sound like today’s long-term unemployed or desperately underemployed white collar professionals? This phenomenon has been studied, and some of those studies are a dry read, but they’re enlightening.

First, a cold, hard look at the ugliest possible outcome. What characterized the state of mind of our homegrown all-American terrorists, Unabomber Ted Kaczinski and Oklahoma City Bomber Timothy McVeigh? “Criminals must come to believe their actions will be beneficial — to themselves, their community, or society. … The Olson hypothesis (source unknown) suggests that participants in revolutionary violence predicate their behavior on a rational cost-benefit calculus to pursue the best course of action given the social circumstances. … A terrorist plot in a democratic society is less likely to involve senseless violence than a scheme hatched under an authoritarian regime because under the latter, terrorists realize they have nothing to lose ….”²

Well, we do have a (reputedly) democratic society. Sure, under the current regime, um, I mean “administration,” corporations seem to have bought the government somewhere among their own industry mergers. Both houses of Congress harbor too many of our representatives who have become puppets of the lobbies for financial services (banking, insurance and the rest), pharmaceuticals, broadcast communications, and petroleum (whence commeth our current Executive branch leaders). Legislation has consistently protected big-contributor businesses but not the voting public.

For the white collar un- and under-employed, however, both their government and their fellow citizens have become somehow less “ours” and increasingly “other.” The Land of Opportunity seems to have become the Land of Outsourcing to increasing numbers of the disenfranchised. So, although their potential desperate acts of civil disobedience may not involve senseless violence, certainly these well-educated and disaffected folks may become quite creative in pursuing “the best course of action given the social circumstances” because they believe “their actions will be beneficial — to themselves, their community, or society.” We’ve all read Thoreau — we may not be Transcendentalists, but we sure want to transcend our current economic doldrums.

What is the current psychological state of white collar professionals experiencing long-term unemployment or severe underemployment because of outsourcing and other causes of U.S.-based job shrinkage in the standard corporate “exempt” professions? You don’t have to take my word that despair, lower self-esteem, frustration, and anger are part of the mix. Bloggers have been expressing themselves unreservedly.

One notes a “disturbing video [on YouTube]… Immigration attorneys from Cohen & Grigsby explains how they assist employers in running classified ads with the goal of NOT finding any qualified applicants, and the steps they go through to disqualify even the most qualified Americans in order to secure green cards for H-1b workers.”³

On The Big Picture site, an early September 2007 post titled “4.6% Unemployment is actually 5.5%” (once you look at the real stats) motivated one responder to draw attention to a chart that correlates declining Employment Population Ratio with subsequent recessions. It also piqued a response (on the original Big Picture posting page) from “spongetoddsquarepants,” who waxed sarcastic about the federal government’s playing fast and loose with other statistics: “W told us last year that the economy was strong and they were going to keep it strong. Fudging the calculations to get the data you want is one way to another ‘mission accomplished.’ Should we expect anything else from Enron cronies? By the way we are also kicking ass in Iraq.”

The Disgruntled Workforce blog (a site for the anxiously and just plain miserably employed) contains expressions of depression, anger at, and alienation from, a Corporate America that has not kept its brand promise. Examples:

• “Dear heartless former employer, How can you be so cold as to fire me because I had to stay home with my sick kids two days in a row? You are the lowest of the low. I pray that next time you are sick nobody is around to take care of you.”
• “Dear devil of a boss and evil coworkers who turned their back on me,
  This will all come back to haunt you. Mark my words. There is no way that you can be so cruel to someone, and get away with it. Bad Karma will come your way, and make you miserable.”
• “I just spent 5 years at an institute of higher learning - obtaining my Bachelor’s AND Master’s - and have crap to show for it in the way of gainful employment. NOBODY seems interested in hiring me. I’m forced to whore out my resume to everyone and anyone I know - to no avail. I’m forced to consider going back into retail sales - something I have not done since high school, and vowed to never do again.” Responses to this despairing and angry fellow shared similar stories. “I dread interviews, because, even though it’s a chance to find a job, it’s also another opportunity to be told ‘No thanks’, and feel completely denigrated. “I was the same way when I graduated after the IT bubble burst. I have lived from temp job to temp job. All I can say is good luck and your soft skill will have more value than any sort of engineering or science. Don’t believe the hype, as I know many engineers, some with multiple degrees that don’t have work or have gone into manual labor union jobs.”
• One corporate recruiter gave the jobless and desperate some do/don’t advice about job search techniques, resumes and interviews. One bit of his wisdom was, “It’s not all about money. In fact, you don’t need to bring up compensation. Why? Because if you’re worth it, you’ll get it.” He meant well, but the anger of the financially struggling community flamed him back: “Hey, when the collector wolves are growling at your door for bill payments because the cost of living isn’t fucking free, it most definitely is about money.” “You know, for every “tip” in this post, there are a dozen HR professionals telling job seekers to do the exact opposite.”

Alienated. Disrespected. Devalued. Cynical. Betrayed. Hmmm. “Going postal” may soon expand to “going corporate” or “going societal.” I’m not thinking conspiracy or organized sabotage. Organizations haven’t served this population well. Not professional organizations, nor corporate organizations, nor government bureaucracies and programs. These are smart, independent, highly capable people. They’re more Ted Kaczinski than Timothy McVeigh and not likely to join an Al Qaeda sleeper cell. Who goes postal? That’s been studied. People go postal when a “…hostile atmosphere fosters emotional and psychological instability among employees. … We know what kind of people do this type of thing: frustrated, lonely people who have complained before.”⁴ That sounds too familiar.

Disaffected white collar professionals who had happy, loving childhoods and successful early adulthoods are more likely to communicate with their Congresspersons before they do anything rash than to issue a manifesto to the New York Times after they’ve begun blowing up people and places. United Professionals, MoveOn.org, AARP and other advocacy organizations urge and enable “tell your Senator and Congressperson” campaigns regularly.

But once alienated professionals become fed up with the lack of action from legislators, they’re likely to do something. They’re rational - angry, but rational. They’re likely to be more understanding of the pace of policy change … for awhile. But after some years of flipping burgers and greeting mega-store shoppers instead of doing the jobs for which they’re qualified, they will have had plenty of time to reflect upon the lack of any policy progress toward re-inventing the “deal” for educated professionals employed by corporations in the former Land of Opportunity.

Can socio-economic conditions drive reasonable professionals crazy? A study of “Cultural Psychopathology: Uncovering the Social World of Mental Illness” found that “[t]he examination of both social and cultural processes is one way to help guard against [minimizing] the powerful political economic inequalities that coexist with culture.”⁵ Another study, this one of “Joblessness, Family Disruption, and Violent Death in Chicago, 1970-1990″ found these indicators of violence: “when paths to family formation and stability are blocked by extreme levels of unemployment among young men. … violence-sustaining beliefs and norms eventually evolve in response to the extended and severe economic deprivation and social isolation… high suicide rates in affluent neighborhoods are influenced by sensitivity to status loss. … … both deliberate interpersonal violence and accidental deaths are associated in similar ways to the structural processes of employment and family disruption, especially for males.”⁶

After working two jobs to keep the family intact while also taking federally or state funded training in some new workplace skills or tools, and finding that they’re too “overqualified” (read: old) to be considered for the entry-level jobs that demand these skills, and realizing that without some “entry” there is no “moving up” … and after realizing that full retraining in a growing profession costs far more than the grants provide or that they can afford themselves … after all that, what do people with no means of re-entry into meaningful work do?

What do they do with their despair, their lowered expectations and undermined self-esteem, and their alienation from a society where recruiters ask them what value they can add to the job, while hedge-fund managers pay themselves millions of dollars for adding no value and actually putting our entire economy at risk, lowering the international value of the American dollar? Once despairing professionals have done that math, what do they do with their unvalued creativity and imagination?

Can the observations and theories of group conflict and insurgency described in Environment, Scarcity, and Violence predict their actions? Author Thomas F. Homer-Dixon finds that “insurgency is a function of both the level of grievance motivating challenger groups and the opportunities available to these groups to act violently on their grievances. If a group’s sense of relative deprivation rises, then its level of grievance will rise; if the group perceives that the structure of power relations surrounding it has changed in its favor, then it will perceive greater opportunities to address its grievances. … [R]elative-deprivation theory says that some groups will become increasingly frustrated and aggrieved by the widening gap between their actual level of economic achievement and the level they feel they deserve. The rate of change is key: the faster the growth of the gap, the greater the grievance.”⁷

Surely college educated professionals, promised the benefits of education and hard, loyal work, can understand the economic data of the skyrocketing wealth of the top one percent of U.S. households and the widening gap between those extreme-haves and the middle class, which loses more to inflation every year. What will disenfranchised professionals do to redress their grievances after the “petition Congress” option has proven fruitless?

Elizabeth Kandel Englander explains the context and motivations for civil unrest in Understanding Violence. The situation sounds all too familiar. Bold print is my emphasis. “[F]rustration and aggression can be caused by relative deprivation, which arises when people perceive a widening gap between the level of satisfaction they have achieved (often defined in economic terms) and the level they believe they deserve. Deprivation is therefore relative to some subjective standard of equity or fairness, and the size of the perceived gap obviously depends on the beliefs about economic justice held by individuals. … Serious civil strife is not likely unless the structure of political opportunities facing challenger groups keeps them from expressing their grievances effectively and peacefully, but offers them openings for violence against authority. This opportunity structure depends on the relative power and resources of challenger groups and the state, on the power of groups that might ally themselves with challenger groups or the state, and on the costs and benefits that groups believe they will accrue through different kinds of collective action in support of or in opposition to the state. … The likelihood of insurgency is greatest when multiple pressures at different levels in society interact to boost grievance and opportunity simultaneously. Environmental scarcity can change both variables by contributing to economic hardship and dislocation, by increasing intergroup segmentation, and by weakening institutions such as the state. …Whether or not people become aggrieved and violent when they confront economic difficulty depends, in part, on their notion of economic justice. People belonging to a culture that inculcates acceptance of deprivation and unequal distribution of wealth-as has been the case among lower castes in India-will not be as prone to violence as people believing they have a right to economic well-being and an egalitarian distribution of wealth. … If people come to believe that the state is responsible for their hardship, its legitimacy will be reduced, and the likelihood that they will engage in violence against the state will increase.”⁸

Will alienated professionals become a “challenger group” or individual challengers? Nobody can predict what they may do - but we may not like what they think up.

I do think that the social, corporate and governmental leaders of the United States would be well advised to consider this nation’s history of civil unrest by the best and the brightest, and begin quickly to enact programs that keep white-collar professionals well-employed and significantly contributing members of our society.

Resources

1. Sageman, Marc. “The Normality of Global Jihidai Terrorism,” Journal of International Security Affairs (8: Spring, 2005), online at http://www.securityaffairs.org/issues/2005/08/sageman.php.

2. O’Connor, T. “The Political Theory of Anarchism as a Theory of Terrorism” and “The Economics Theory of Rational Choice as a Theory Of Terrorism” in “The Criminology Of Terrorism: Theories And Models.” Carolina Wesleyan College, online at http://faculty.ncwc.edu/toconnor/429/429lect02.htm

3. Hudson, Rex A. “The Sociology and Psychology of Terrorism: Who Becomes a Terrorist and Why?” A Report Prepared under an Interagency Agreement by the Federal Research Division, Library of Congress, online at http://www.fas.org/irp/threat/frd.html4.

4. New York Times. (July 2, 1993) “Postal Study Aims to Spot Violence-Prone Workers,” online at http://query.nytimes.com/gst/fullpage.html?res=9F0CE4DA1339F931A35754C0A965958260

5. Lopez, Steven Regeser and Peter J. J. Guarnaccia. “Cultural Psychopathology: Uncovering the Social World of Mental Illness.” Annual Review of Psychology. (2000)

6. Almgren, Gunnar, Avery Guest, George Immerwahr, and Michael Spittel. “Joblessness, Family Disruption, and Violent Death in Chicago, 1970-1990.” Social Forces. (Vol. 76, 1998)

7. Homer-Dixon, Thomas F. Environment, Scarcity, and Violence. Princeton University Press, 1999.

8. Englander, Elizabeth Kandel. Understanding Violence. Lawrence Erlbaum Associates, 1997.

We thought that AARP’s position on universal health care was peculiar, so we began to look into what others voices were saying. Here is a very interesting sample, compiled by UP board member Trude Diamond.

Background
1. Universal Healthcare News at The Progressive Review - June, 2007
Source: http://prorev.com/healthplan.htm

Section Title: VOICES YOU MAY NOT HAVE HEARD ON MEDICARE

JOHN HESS, HEALTH WRITER [Note from Trude: A NYT reporter who died in 2005 -- no mention of what exactly his "once again" refers to, obviously not HB 676] - “Once again, the AARP has stabbed America’s elderly in the back. For more than 30 years now, it’s been held up as a scarecrow - a monster representing 35 million greedy geezers. . . Briefly, the AARP is not a league of the elderly, but a marketing agency with a shady past. It peddles insurance, travel, advertising, and anything else it can get its hands on. It has a mailing list - not a membership - of 35 million customers. If you turn 50, they’ll try to get your name on it. It calls itself an ‘association’ and goes through the motions in an effort to dodge taxes and commercial mailing rates, and it’s been in constant trouble with the IRS and the Postal Service.”

2. AARP to Reap Huge Profits from Flawed Medicare Drug Bill

Senior’s Group Makes $163 Million Annually on Insurance Sales

Source: http://www.yuricareport.com/Medicare/AARP_to_ReapHugeProfitsFromMedicare.html

News Intelligence Analysis - Nov 23, 2003

The American Association of Retired Persons (AARP) derives significant income from the sale of health and life insurance policies, and stands to make hundreds of millions more under the Medicare Prescription Drug bill now being debated before Congress. Yet the AARP’s financial interests in the bill have received scant attention.

The AARP’s current insurance-related revenues come in several streams.

1- They receive royalties from “AARP” insurance policies marketed to their members by United Healthcare, MetLife and others. Last year these royalties amounted to $123.283 million.

2- They receive list access fees from insurance firms that market to their membership. In 2002, such fees totaled $10.794 million.

3- AARP receives “Quality Control fees” from insurers that amounted to $893,000 last year.

4- AARP also earns investment income on the premiums received from members until such premiums are forwarded to United Healthcare and MetLife. In 2002, AARP earned $26.708 million in such investment income.

2007 AARP Statements and External Comments

Trude’s preview: AARP’s forward-thinking opening volley in Jan 2007 was soon followed by business as usual statements and actions.

If you are pressed for time, skip right to Item #8 at the end. If you want to more fully understand the context with a bit of history, read all the items.

AARP has partnered with for-profit insurers (United Health and Aetna), while stating AARP would use its bargaining power to get the best benefits package for the lowest prices for its members. (1) What if you’re too young to join AARP but still uninsured? (2) As an AARP member, I priced its offering for me when I got fired in June, and found that its health insurance through United Health-the same company I’m already insured by through my former employer-had higher deductibles and higher premiums than continuing my employer’s coverage at full cost to myself through COBRA. Pathetic!

1. Health Care for All: Big Business to the Rescue?

As unlikely as it seems, big business may be the force that brings about universal health insurance.
Source: http://www.pnhp.org/news/2007/january/health_care_for_all.php - reprinted from AARP Bulletin

By Daniel Gross
AARP Bulletin
January 2007

As unlikely as it seems, big business could emerge as the force that finally brings about universal health insurance. In the first week after the November elections, the CEOs of General Motors, Ford and Chrysler met with President Bush to discuss issues they faced, including health care costs. That same week, America’s Health Insurance Plans, a trade group of large insurers, released a 10-year, $300 billion proposal to provide health insurance for all children and 95 percent of adults-through a combination of tax breaks for individual taxpayers and the expansion of government programs such as Medicaid.

[NOTE FROM TRUDE: In comment #5, AHIP's disingenuous involvement in this issue is revealed. You can click that link above right now, read it, and return here from the link in that comment.]

“I think we’re getting to a tipping point where this country is going to be willing to move on health care,” said Wal-Mart CEO Lee Scott in an appearance on the Charlie Rose show last year. “Business and labor are going to have to participate and probably play even more of a leadership role than government … and then bring the political side along with them.”

To Rose, the solution to America’s health care crisis is relatively simple. “We need some form of universal coverage that would be funded centrally by the government, but delivered privately through existing mechanisms like HMOs,” he said. The program, he suggested, could be funded by a tax on imports.

The discussion is clearly being prompted by bottom line issues: Soaring health care costs are a major problem for business. Companies in the United States compete against rivals in developed countries (Japan, Germany and France) where the government funds health care, and against developing countries (China, India) where neither business nor society at large is responsible for health insurance. Either way, American companies that provide health insurance are at a competitive disadvantage.

In 2005 money-losing General Motors spent $5.3 billion to cover the health costs of 1.1 million employees, retirees and dependents. Ross noted that, on a per-car basis, General Motors spends more money on health insurance than on steel. But Old Economy behemoths like GM aren’t the only ones suffering. “Since the beginning of this decade, health insurance premiums for average employers have increased 87 percent, compared with overall inflation of 18 percent,” said Joel Miller, vice president of operations at the Washington-based National Coalition on Health Care (NCHC), a nonprofit alliance of business, unions and consumer groups. These higher costs cut into operating margins and reduce the capacity of businesses to grow.

[NOTE FROM TRUDE: NCHC - another unholy alliance, potentially, because insurers are one of the business sectors involved]

2. National Institute of Health Policy (focusing on the Upper Midwest states) - by Dave Durenberger

Source: http://www.nihp.org/Commentary4%2019%2007.pdf = April 17, 2007

AARP’S HEALTH MARKET EXPANSION … AARP, United Health Group, and Aetna

will soon launch a bold experiment to improve healthcare quality and outcomes by changing the healthcare marketplace. Those of us who have long hoped Medicare payment policy would change the U.S. health care system for the better had begun to lose hope when Republicans in 2003 sought to turn Medicare and seniors over to unmanaged private health insurance plans. I myself was critical of AARP for providing the political cover for Republicans and some Senate Democrats to vote to sell the program to the highest private bidders. On Monday of this week AARP announced plans to significantly expand their Medicare product offerings, including a new managed care plan for the 55-64 age group market. AARP intends to use this expanded market power to drive improvements in health quality and care coordination.

We have to trust the AARP Board. And we have to help them shape this bold plan. And why

not? Economists tell us that in any market the commodity in short supply can leverage change.

In health care that commodity is buyers with information and resources to help consumers

make informed choices. Employer coalitions have waxed and waned. Only the Federal

Employee Health Benefits Program (FEHBP) has proven the point. Since it began giving

federal employees national and local health plan choices back in 1960, millions of FEHBP

employees and retirees are making a difference.

My recommendation is that AARP consider playing a similar role to FEHBP. Unlike FEHBP, but like MN Advantage (the MN State employee plan), AARP would pre-qualify the plans available to me in MN to assure adherence to benefit and performance standards.

[NOTE FROM TRUDE: Durenburger is optimistic on April 17. Then reality sets in with other observers on April 26. See item #3.]

3. Schwarzenegger Meets Secretly with AARP: Healthcare “Reform” by Requiring Everyone to Buy Private Insurance

Source

AARP, the health insurance giant with almost a $billion in revenues, is planning a California-wide education campaign on healthcare reform, and is teaming up with California Governor Schwarzenegger’s campaign to cover the uninsured by forcing them to buy private health insurance. “We don’t want to miss this very unique opportunity in California,” said Mark Beach, a spokesman for the group. SF Chronicle, 4-26-2007

AARP is concluding deals with Aetna and Unitedhealth which it expects to double its HMO membership. Dawn Sweeney, CEO of AARP Services, told reporters that AARP has about 7 million policyholders in a variety of programs, include Medicare prescription drug plans and supplemental insurance that pays for some of the co-payments and deductibles that Medicare does not cover. AARP receives an average of $185 million a year in royalty and revenue payments from its health insurance. AARP expects to double the number of people in its branded products over the seven years and estimates it will garner an additional $1.5 billion in royalty payments as a result. USA Today, 4-17-2007

Arnie’s secret visit

Source: http://www.pasadenaweekly.com/article.php?id=4571&IssueNum=69 - April 26, 2007, by Joe Piasecki -

Schwarzenegger to come to Pasadena Monday for a no-Democrats AARP health care forum.

Currently pushing a controversial plan to require all Californians to purchase medical insurance, Gov. Arnold Schwarzenegger will address an unpublicized health care forum hosted by AARP, formerly the American Association of Retired Persons, on Monday at the Pasadena Convention Center, the Weekly has learned.

Not invited to the event, however, are state Democratic leaders with competing health care reform packages up for debate in the Senate and Assembly.

For its part, AARP has “promised not to promote this beyond our membership,” said spokeswoman Charee Gillens, who referred all questions to Schwarzenegger’s office.

Gillens did say, however, that the purpose of the invitation-only event was to highlight the need for health care reform.

With both parties silent in the meantime, the real question is, “Is this really a governor’s event or an AARP event?” asked Alicia Trost, spokeswoman for state Senate President Pro Tem Don Perata, a Democrat from Oakland whose health care plan was expected to be heard in committee yesterday.

Both Trost and staff working for Assembly Speaker Fabian Nuñez, a Los Angeles Democrat whose health care reform bill was discussed in legislative committee on Tuesday, confirmed that Perata and Nuñez had not been invited.

The 38-million-member AARP boasts 3 million members in California, making it the largest advocacy organization of its kind in both California and the nation.

National AARP CEO Bill Novelli is also expected to be in Pasadena on Monday.

While being excluded from an AARP-generated event would come as a shock, Trost said Perata would not expect to be part of any Schwarzenegger public relations campaign.

With three competing plans, two of them Democrat-generated, “It’s too early for everyone to be standing up together,” she said.

Although both Democratic bills would not need any support from Republicans to get to the governor’s desk, “We definitely want to work with the administration,” said Trost.

Meanwhile, a spokeswoman for another citizens’ rights group said all three plans are flawed in at least one significant way - protecting the public from price-gouging.

“If you’re an insurance company, you’d have to be breaking out a cigar in celebration over the fact that none of these three new proposals is going to do anything to regulate health insurance rates or make the finances of the for-profit insurance companies any more transparent,” said Judy Dugan, research director for the Santa Monica-based Foundation for Taxpayer and Consumer Rights.

“All twist themselves into knots trying to work within the current system of private health insurance, which is exactly what has gotten us to the point of having 7 million people uninsured in California,” said Dugan.

The Foundation for Taxpayer and Consumer Rights was also the leading proponent of Pasadena’s Measure B, a campaign finance reform law twice-approved by voters that makes it illegal for city officials to accept money or gifts from those who have benefited from their decisions in office.

Schwarzenegger’s health insurance plan would require all Californians to purchase health insurance from a private carrier, but place few controls on the quality and price of coverage. It would also force businesses to spend 4 percent of their payroll costs on providing insurance to employees or paying into a state fund for uninsured workers.

4. Let’s skip the gimmicks and enact real reforms

Source: http://www.pnhp.org/news/2007/january/lets_skip_the_gimmi.php

By MERTON C. BERNSTEIN
HEALTH CARE
Special to The Kansas City Star
Published on Wed, Jan. 24, 2007

(Merton C. Bernstein is a Coles Professor of Law Emeritus at Washington University. He was principal consultant to the National Commission on Social Security Reform and is a founding board member of the National Academy of Social Insurance.)

To tame costs and extend coverage, we must harvest savings where now we sow and reap inefficiently. The Schwarzenegger and Massachusetts gimmicks and the plan shaped by the same people who designed the perplexing and inefficient Part D - health insurers and AARP - plow other fields. Instead of savings, they increase nonbenefit costs. That’s not reform.

[NOTE FROM TRUDE: The article below gives enlightening background on the HMO industry's strategy for confounding the Medicare Modernization Act's intention. See item 8's AARP statement of its intent to provide "a counseling service" to help members figure out the best plan for them in the HMO mess it supports. What we need is a plan that's straightforward enough for consumers to understand on our own - a plan without intricacies meant to mask high profits and ridiculous levels of waste.]

5. The Medicare Privatization Scam - in The Nation, July 16

Source: http://www.thenation.com/docprem.mhtml?i=20070716&s=lieberman

Trudy Lieberman

In the next few weeks Congress will decide whether to cut $54 billion in overpayments to Medicare insurers, igniting a battle that may well determine whether the program survives. On one side are Medicare supporters, who want it to continue as a successful social insurance program. On the other is the insurance industry, which is spending millions and lobbying hard to put Medicare on a fast track to privatization, a goal long sought by fiscal conservatives and their allies in right-wing think tanks.

The seeds of the conflict were sown in 2003, when Congress passed the Medicare Modernization Act (MMA), which gives seniors a prescription drug benefit that is sold and administered by private insurers, not the government. This drug benefit, known as Part D, opened new markets for insurers, some of which have profited handsomely from the government’s gift. The story of one of those companies, Humana, a forty-six-year-old carrier based in Louisville, Kentucky, shows what’s at stake.

Before 2003 Humana, a regional company peddling health insurance, including HMOs, was hardly a household name. One of its policies had been a big money loser, and the company was struggling to dig its way out of a financial hole. Vice president Steve Brueckner called the MMA “an unprecedented opportunity to establish relationships,” and his company made the most of it. Humana gained 4 million new policyholders and reported to stockholders in April that it had amassed “record breaking revenues.” What’s more, Humana has become a national brand poised to sell policies in the non-Medicare market, where people will increasingly be forced to buy their own health coverage, especially if an “individual mandate” becomes a solution for the country’s healthcare woes. “Part D transformed the company,” says Bridget Maehr, an analyst for A.M. Best, an insurance rating service.

Humana’s game plan centered on the options the MMA gave seniors for obtaining their benefits. They could keep traditional Medicare, in which the government provides the benefits, and buy a “stand-alone” drug benefit; or they could get the new drug coverage plus regular Medicare benefits provided by one of the Medicare Advantage plans, which include HMOs, the less restrictive preferred provider organizations (PPOs) and private fee-for-service plans, which usually offer traditional Medicare benefits, drug coverage and benefits for extras like dental, vision and chiropractic care. There are no limits on specialist referrals, and seniors can choose any doctor who accepts the insurer’s fee schedule.

Some Medicare Advantage plans were not new. Medicare HMOs had been around since the 1970s. But by the late 1990s, conservatives had seized on HMOs, as well as new options such as medical savings accounts and PPOs, as ways to speed up privatization. Under the guise of “consumer choice,” always a popular concept, Congress authorized four new kinds of plans, in the 1997 Balanced Budget Act, that would compete with traditional Medicare.

In theory, private plans, particularly managed care, would reduce the program’s escalating costs. Government payments, it was argued, would allow these plans to offer both standard and extra benefits and encourage efficient, low-cost care. However, after 2003 the government began shoveling huge sums of money into the Medicare Advantage plans to entice seniors to leave the traditional program-in effect subsidizing privatization even more and bringing right-wing think tanks like the Heritage Foundation closer to their objective of ending Medicare as social insurance. The ultimate goal, of course, is to make seniors bear future costs, sparing their benefactors the need to pay more taxes to keep Medicare afloat. This year the government will pay insurers on average 12 percent more than it costs to provide the same benefits to people who stay in the traditional program, according to the Medicare Payment Advisory Commission (MedPAC), an independent group that advises Congress. HMOs will get 10 percent more, but private fee-for-service plans will get a whopping 19 percent more, a subsidy that lets them offer rock-bottom premiums and lots of extras-at least for now.

An unlikely player in the 1997 debate was the National Right to Life Committee. Worried that Medicare HMOs would euthanize old people, the committee lobbied Congress to allow private fee-for-service plans in the 1997 law as an alternative to managed care. Carriers were slow to market them, and in December 2005 only about 200,000 Medicare beneficiaries had signed up. But thanks to the federal honey pot, all that has changed. By February of this year, 1.3 million seniors had chosen fee-for-service plans, a sixfold increase that makes them the fastest-growing segment of the Medicare Advantage program.

Former House Speaker Dennis Hastert of Illinois also did his part to give an edge to certain fee-for-service plans. As Congress put the finishing touches on a catch-all bill late last year, Hastert got the House Rules Committee to insert a provision that gives sellers a larger window of time to sell these plans. They can be sold all year, not just between November 15 and March 31, the only time other Medicare Advantage plans can be sold. According to the New York Times, Aon, a large Chicago-based carrier, pushed for the change to help its subsidiary Sterling Life, the first carrier to market private fee-for-service plans in 2000. Aon recently told stock analysts that its health insurance business had a strong first quarter with good growth, “driven primarily by Sterling.” According to the Center for Responsive Politics, Aon is the twentieth-largest insurance contributor to political campaigns. It has given generously to the Illinois Republican Party and to Hastert. In the 2003-04 election cycle, Hastert received a run-of-the-mill contribution of $5,000; in 2005-06, as fee-for-service plans were becoming more important, Aon and its affiliates gave Hastert $23,900.

From the start, Humana saw gold in Medicare Advantage and embarked on a strategy of government-sanctioned bait and switch: Offering the lowest premiums in most counties across the United States (some as low as $1.87 per month), and selling through agents stationed in Wal-Mart stores, Humana signed up more than 3 million seniors just for its stand-alone drug benefit. It was willing to trade off smaller profits for the prospect of eventually switching seniors to the more lucrative Medicare Advantage plans. On average, seniors pay about $100 a year for Humana’s stand-alone plans, versus about $800 for its other Medicare Advantage plans. To get people into those other plans, Oklahoma regulators say, it paid agents commissions that were five times higher than commissions for stand-alone plans. This spring Humana announced that 100,000 people had moved to Medicare Advantage plans, and most chose private fee-for-service options. “It reflects good value for seniors and their preferences,” says Humana’s outgoing chief actuary, John Bertko. It’s also good value for Humana. Says one Washington insurance consultant: “An additional 100,000 people contributing to top line revenue is not insignificant-it’s an extra billion dollars.”

Private fee-for-service plans are also catching on with United Healthcare, Aetna and Blue Cross Blue Shield, the country’s insurance giants, which like these plans not only because of generous government payments but also because they are easy to administer. There are no cumbersome networks of doctors and hospitals to police and little oversight of the quality of treatment delivered to beneficiaries. So insurers are prospecting for new markets, selling fee-for-service plans to employers obligated to provide health benefits for their retired workers. The Michigan Public School Employee Retirement System, for example, just moved 115,000 retirees into a fee-for-service plan sold by Michigan Blue Cross Blue Shield.

Nearly 20 percent of the 43 million Medicare beneficiaries have enrolled in Medicare Advantage, up from 13 percent in 2004. Citigroup estimates that one-quarter of all beneficiaries will belong to one by 2010. “Enormous growth prospects remain,” Citigroup analyst Charles Boorady told investors in February.

All that, of course, depends on what happens in Congress. When the Congressional Budget Office estimated the bill for the overpayments at $54 billion for five years and $149 billion over ten, cuts seemed likely. After all, Medicare’s chief actuary, Richard Foster, has said that overpayments shorten the life of Medicare trust funds by two years and raise premiums that all beneficiaries pay for doctor and outpatient services. MedPAC has recommended giving all Medicare Advantage plans no more than it costs the government to provide benefits under the traditional program. “I don’t see any possible defense for the overpayments,” says Robert Berenson, MD, a senior fellow at the Urban Institute. “Managed care has been ineffective at controlling costs in the commercial sector. Why would we want to turn Medicare over to private plans and abandon traditional Medicare, where if we wanted to, we could actually manage costs?” For example, Congress could lift the MMA prohibition on negotiating lower drug prices with pharmaceutical companies. But earlier this year the Senate refused to do that, bowing to lobbying pressure from Big Pharma, which believes government negotiations will lead to the dreaded price controls.

Some HMOs have not been particularly good at improving care. A 2005 study by The Commonwealth Fund found that beneficiaries enrolled in for-profit health plans received significantly lower-quality care than those belonging to not-for-profit plans when it came to certain procedures like giving patients appropriate medications after heart attacks. (Most Medicare beneficiaries belong to for-profit HMOs.)

[NOTE FROM TRUDE: Here's the AHIP involvement commentary referenced in Item #1. There's more AHIP and HR-676, and more acidly written, in Item #6.]

Despite convincing evidence for cutting payments, America’s Health Insurance Plans (AHIP), a trade association of insurance companies and HMOs, has managed to marshal strong support in Congress for continuing them; many legislators see nothing wrong with seniors reaping extra benefits from private fee-for-service plans, which they argue bring more choice to constituents, especially in rural areas without managed care. “It’s absolutely brilliant how this has been orchestrated,” says Bonnie Burns, a training and policy specialist with California Health Advocates. AHIP has turned the usual industry/consumer lobbying dynamic on its head, casting legitimate consumer groups like California Health Advocates and the Medicare Rights Center as bad guys for wanting cuts and the insurance industry as good guys for wanting more money poured into the program. Consumer groups generally advocate more money for social programs, but in this case they see the overpayments as a strategy to destroy Medicare.

To confuse legislators even more, the industry has called on its own sham “consumer” group, the Coalition for Medicare Choices, to push its agenda on the Hill. AHIP founded the group back in 1999 and still provides administrative support, according to spokesman Mohit Ghose. The address on the coalition’s website turns out to be the same one as Democracy & Data Communications, a public relations counseling firm whose clients include AHIP, Humana and United Healthcare, another carrier riding the Part D gravy train with lucrative deals to sell plans to members of AARP, the retirees’ organization. The coalition now has 400,000 members, in every state; and the group has gained 140,000 new members in the past sixty days. Its main purpose seems to be ginning up letters and calls to members of Congress “to protect choices and additional benefits provided through the Medicare Advantage program.” Sterling Life’s website, for instance, tells visitors about the Coalition for Medicare Choices and urges them to send letters-sample included. Nowhere does it say that the coalition is a creature of the industry’s trade association.

6. The Corporate Crime of Selling Private Health Insurance

Source: http://www.pnhp.org/news/2007/march/the_corporate_crime_.php

Physicians for a National Health Program

^{Posted on March 28, 2007}

by The Corporate Crime Reporter

On Saturday, the Center for American Progress Action Fund and Service Employees International Union (SEIU) sponsored a forum in Las Vegas for presidential candidates to discuss health care.

No Republicans accepted.

Seven Democrats accepted.

All the candidates at the forum agreed that universal health care was the goal. (Even the Business Roundtable and the insurance industry now say they want “universal health care.”)

But only one — Congressman Dennis Kucinich (D-Ohio) — accepts the only answer that will work, single payer.

Medicare for all.

The rest — including Barack Obama, Hillary Clinton, Chris Dodd, Bill Richardson, Mike Gravel, and John Edwards — want some mixture of public and private health insurance.

They know this public/private mix won’t work — the healthy wealthy will buy private insurance, the sick poor will sign on with the government — and the government program will be crippled.

But they don’t have the guts to stand up to the private insurance industry and say, get out.”

[NOTE FROM TRUDE: Further AHIP exposé re HR-676. Click here to return to Item 5.]

Kucinich has introduced single payer legislation (HR 676) in Congress that would make it unlawful to sell private health insurance for benefits that are medically necessary.

Last week, we entered the belly of the beast — the American Health Insurance Plans (AHIP) 2007 National Policy Forum at the Capital Hilton in Washington, D.C.

AHIP is the trade association for the companies that will be sacked if single payer becomes law.

We walked into a session titled Coverage for All Americans: Putting Access at the Top of the National Agenda.

The session was moderated by AHIP President Karen Ignagni.

Not once during the 90-minute session was single payer mentioned.

Universal coverage, yes.

Single payer, no.

But during the discussion, the geography of nowhere was laid out.

On one side, Ron Pollack, executive director of Families USA had teamed up with AHIP’s Ignagni.

On the other, Bill Novelli, CEO of AARP and John Catsellani, president of the Business Roundtable.

AARP and the Business Roundtable have joined with SEIU to form something called Divided We Fail.

Divided We Fail is a corporate liberal answer to single payer.

All Americans should have access to affordable quality health care.

All Americans should have peace of mind about their future long-term financial security.

Families USA and AHIP do a separate dance but mouth similar platitudes.

But both Divided We Fail and Families USA/AHIP dismiss single payer as unworkable.

On the single payer side is Kucinich, about 60 members of the House of Representatives, the California Nurses Association, Physicians for a National Health Program, and Health Care Now.

Kucinich is now the single payer champion.

The problem with Kucinich, of course, is that if he doesn’t get the nomination, he will take the stage at the Democratic Convention in 2008 in Denver, as he did in 2004 in Boston, raise the hand of the corporate nominee and endorse the corporate platform.

Then where will we be?

Nowhere.

Again.

7. Health care: The best won’t be the easiest

Source: http://www.pnhp.org/news/2007/april/health_care_the_bes.php - reprinted from Newsday

Saul Friedman
Newsday
April 21, 2007

Most of the more pragmatic proposals reject the single-payer approach, fearing it would run afoul of lobbying campaigns against centralized government control of health care. The latest proposal, called AmeriCare, comes from one of the most liberal members of Congress, Rep. Pete Stark (D-Calif.). Like most others, it would depend on private, for-profit insurance companies to provide health care for the non-elderly.

Even AARP, which earned $379 million in royalties in 2005, mostly from health insurance sales, appears to favor universal public and private health care coverage. AARP endorsed and makes millions from Part D, which is based wholly on private coverage. Last month’s AARP Bulletin reported on various state schemes for universal private coverage, but made only passing mention of the Medicare for All proposals in Congress.

The most comprehensive public-private proposal favored by some liberal groups has come from Yale political scientist Jacob S. Hacker. Writing for the liberal Economic Policy Institute, Hacker said he seeks “to avoid the dismal fate of previous reform campaigns” that ran afoul of budget problems, public resistance to change and “the embedded realities of the present system.”

His proposal, Health Care for America, would “extend insurance to all non-elderly Americans through a new Medicare-like program and workplace health insurance…. Every legal resident of the U.S. who lacks access to Medicare or good workplace coverage would be able to buy into the ‘Health Care for America Plan,’ a new public insurance pool modeled after Medicare….Employers would be asked to either provide coverage as good as this new plan or make a relatively modest payroll-based contribution to Health Care for America.

“It would not eliminate private employment-based insurance….It is not single-payer - a vision that, for both political and budgetary reasons, is unlikely to be achieved in the near future. Nonetheless, Health Care for America does embody many of the key virtues of a universal Medicare-like program.”

Hacker’s plan would put private insurance in competition with a Medicare-type plan to provide coverage that would be guaranteed. “Health Care for America,” he writes, would provide “a generous package of benefits…greater choice.” (See epi.org for the full text of Hacker’s proposal.)

Diane Archer, former president of the New York-based Medicare Rights Center, applauded the proposal as a way to create competition between public and private insurers, and predicted that for-profit insurers would not compete because “they would still try as hard as possible to avoid insuring the people with the costliest conditions.”

8. AARP Says It Will Become Major Medicare Insurer While Remaining a Consumer Lobby

[NOTE FROM TRUDE: If you jumped here from my note above item #5, you can return by clicking here. The "counseling service" is mentioned on the next page. This article is the best summary of AARP hidden agenda - just "follow the money" logic, really. To return to Item 1, click here.]

Source: http://www.pnhp.org/news/2007/april/aarp_says_it_will_be.php - reprinted from NYT

By ROBERT PEAR
The New York Times
April 17, 2007

WASHINGTON, April 16 - AARP, the lobby for older Americans, announced Monday that it would become a major participant in the nation’s health insurance market, offering a health maintenance organization to Medicare recipients and several other products to people 50 to 64 years old.

The products for people under 65 include a managed care plan, known as a preferred provider organization, and a high-deductible insurance policy that could be used with a health savings account.

When the new coverage becomes available next year, AARP will be the largest provider of private insurance to Medicare recipients. In addition to the new H.M.O., AARP will continue providing prescription drug coverage and policies to supplement Medicare, known as Medigap coverage.

William D. Novelli, the chief executive of AARP, said, “In launching these initiatives, we are driven by our mission to create a healthier America.”

The group also said it would use its leverage to reshape the health insurance market. The organization has 38 million members, and Mr. Novelli said it hoped to have 50 million by 2011.

The new Medicare product will be marketed with UnitedHealth Group. Policies for people under 65 will carry the AARP name and will be marketed with Aetna.

Revenues and royalties from the sale of goods and services have, for many years, accounted for a substantial part of AARP’s income. AARP officials insisted that its financial interests do not affect the positions it takes on Medicare, Medicaid, Social Security and dozens of other issues on which it lobbies and litigates.

Judith A. Stein, director of the Center for Medicare Advocacy, a nonprofit group that counsels people on Medicare, said, “The new arrangements with insurance companies create a tremendous number of potential conflicts for AARP, which is a powerhouse, perceived as the most important voice for older people.”

The role of private insurers in Medicare is one of the most hotly debated issues in American health policy. In general, Republicans want to expand the role of private insurers like UnitedHealth and Aetna, while Democrats want to limit the role of private entities.

Ms. Stein and her organization work closely with AARP.

“AARP will not be perceived as a truly independent advocate on Medicare if it’s making hefty profits by selling insurance products that provide Medicare coverage,” Ms. Stein said. “AARP’s role in this market could give a big boost to the privatization of Medicare.”

AARP has opposed efforts to privatize Medicare or Social Security.

Dawn M. Sweeney, president of AARP Services Inc., the tax-paying business unit of AARP, said, “We will use our collective market power to negotiate” competitive prices for the new health insurance products.

AARP also said it would use $500 million of insurance sales revenue over the next decade to help people navigate the health care system, with a new counseling service.

Payments to UnitedHealth and Aetna will be linked to their performance in improving the health of subscribers, including members of minorities, Mr. Novelli said. The new plans will coordinate care for people with chronic conditions and will develop special programs to treat people with depression. AARP will measure how frequently the companies deliver recommended treatments to people with diabetes, hip fractures and other conditions.

People ages 50 to 64 often find that health insurance is unavailable or unaffordable when they try to buy it on their own. AARP said its underwriting practices would be less stringent than those of many commercial insurers, but it reserved the right to deny coverage to some sick people ages 50 to 64.

To guarantee issuance of a policy to every applicant in that age group is “just not economically feasible,” Ms. Sweeney said.

About seven million people currently have health insurance of various types, mainly drug coverage or Medigap policies, carrying the AARP brand name. With the new products, Ms. Sweeney estimated, the number will double to 14 million by 2014.