Thursday, March 8, 2012

1.4billion ways to squander our cash: Whitehall finds £159m in savings... by blowing NINE times that sum on 'efficiency' project

  • Whitehall spends £1.4bn in seven years finding savings
  • Money spent on project could pay for 60,000 nurses

Civil servants tasked with reducing Whitehall bills have cost taxpayers nearly nine times more than the so-called efficiency savings they made.
Government departments have squandered £1.4billion over the past seven years on elaborate programmes to share 'back-office' functions.
But the National Audit Office has found that the initiative - launched by Labour - has so far saved taxpayers just £159million.
Down the drain: Piles of money have been wasted in a bid to save Government costs
Down the drain: Piles of money have been wasted in a bid to save Government costs. In total, a seven-year programme has saved just £159million at a cost of £1.4billion
That 'saving' is 8.8 times less than the amount they actually spent, which is enough to pay the salary of more than 60,000 nurses.
And auditors revealed that it is possible that civil servants may have saved even less than £159million outlined in a damning report..
This is because some ministries were no longer monitoring progress - and those that are doing so report a net cost to the taxpayer.
In a damning report, it concluded that a combination of over-expensive IT systems and poor co-ordination between departments and quangos had seen costs soar instead of being slashed.
Last night, Labour MP Margaret Hodge, chairman of the powerful Public Accounts Committee, said it was 'a shockingly familiar story of spiralling costs and poor value for money'.
The huge projects for government departments and their quangos to share back-office functions - including human resources, procurement, finance and payroll - was enthusiastically launched by Labour in 2004.
In its report, the NAO said that private-sector firms typically slash a fifth off their annual spend within five years using similar methods to share back office functions.
Labour MP Margaret Hodge said it was 'a shockingly familiar story of spiralling costs and poor value for money'
Labour MP Margaret Hodge said it was 'a shockingly familiar story of spiralling costs and poor value for money'
But despite trying a similar approach, central government had managed to undermine the whole point of the programme by increasing costs.
In just one shocking entry in the catalogue of waste, auditors discovered that the shared services system set up by the Department for Transport with four of its quangos had so far cost £129million more to set up and run than it had saved.
But with the net savings of joint working totalling only £1.3million last year, the watchdog said 'at this rate it would seem difficult to break even'.
In one example of the problems to beset the scheme, the report found that the Maritime and Coastguard Agency was blocked from joining the DfT scheme because it did not have security clearance for Whitehall IT systems.
Another shared services unit, set up by Research Councils UK, has recorded a net cost to the taxpayer so far of £126million.
Shockingly, financial oversight is so lax that two ministries - the Department for Work and Pensions and the Department for the Environment, Food and Rural Affairs - have no idea whether their schemes have saved any money at all, because no one has been tracking progress.
There was one success story. The Ministry of Justice was saving £33million a year and broke even ahead of schedule - at which point officials there also stopped monitoring performance.
The NAO acknowledged that ministers have recognised the problem and put in place plans to shake up the system and impose more central control over the process. But they warned that the reform was 'ambitious and contains significant risk'.
Mrs Hodge said: 'The Shared Service Initiative started out filled with good intentions to save money and reduce duplication of back-office functions across Whitehall. This has not been delivered.
'Departments lost sight of their overall objective to save money. Departments ordered tailor-made systems which have cost the taxpayer too much.
'The Cabinet Office is now committed to bring this initiative back under control but it may be too little, too late to achieve value for money.'
Sharing back-office functions - also including finance and payroll - was a key recommendation of the 2004 Gershon Review into slashing Government running costs.
In total, eight projects have been set up in various departments - with the five examined by the NAO costing £500million more than budgeted: £1.4billion rather than the expected £900million.
The NAO said one of the main problems was that the bodies that were supposed to be pooling their operations stuck rigidly to individual systems - frustrating the aims of co-operation.
It questioned why officials ordered expensive IT systems without even considering far cheaper versions which would have been more than adequate.
The National Audit Office acknowledged that ministers have recognised the problem and put in place plans to shake up the system and impose more central control over the process
The National Audit Office acknowledged that ministers have recognised the problem and put in place plans to shake up the system and impose more central control over the process
It also blamed a 'collaborative' culture of letting individual departments have freedom from central control for the failure to produce any of the hoped-for cross-Whitehall sharing.
Other factors the NAO highlighted were the need for organisations such as town halls to go through a full European Union tendering process in order to join shared procurement schemes.
A system of sanctions against poor performance - and the power for the Cabinet Office to require bodies to sign up to collaboration - would also help, the NAO said.
Its head, Amyas Morse, said: 'The initiative for government departments to share back-office functions has suffered from an approach which made participation voluntary and tailored services to meet the differing needs of individual departments.
'The result was over-complexity, reduced flexibility and a failure to cut costs. The new Cabinet Office strategy on shared services acknowledges these issues but, if it is to achieve value for money, it must learn the lessons from past implementation.
'Only in this way can the sharing of back-office functions have a realistic prospect of contributing towards the government's drive to cut public spending in the long-term.'
Robert Oxley, campaign manager of the TaxPayers' Alliance said: 'Whitehall bureaucrats appear utterly incapable of taking steps to work more efficiently and save taxpayers' money. It defies belief that civil servants have wasted such incredible sums on an exercise that has failed so spectacularly to save any cash.
'This gross failure suggests an institutionally lax attitude with taxpayers' money that cannot be allowed to continue unchallenged. Hard pressed taxpayers can't afford to keep handing Whitehall a blank cheque only to see it frittered away with nothing to show for it.'
Last night a spokesman for the Cabinet Office said: 'We have been clear that the Government will leave no stone unturned in the hunt for savings.
The Government has already announced a new approach to shared services that will cut through the complexity in the current system and save money for taxpayers.
'The Government is committed to the correct management of major government projects which previously have not always delivered what they set out to achieve.
'A Major Projects Authority - set up under a mandate from the Prime Minister - was created in 2010 and introduced tough new controls for major projects to manage risk.'


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Daniel Hannan - Politicians can't create jobs

Huge Spike in Repeat Foreclosures

The pig in the python is suddenly moving.
Fuse | Getty Images

Thousands of foreclosures that were stuck in process due to delays over the so-called "Robo-signing" paperwork scandal are working their way through a revamped banking system and heading toward final bank repossession.
Foreclosure starts surged 28 percent in January from December, according to a new report from Lender Processing Services. More than 230,000 loans began the foreclosure process in January.
Even more indicative of this new surge in processing is that repeat foreclosures hit an all-time high in January, representing 47 percent of all starts, according to LPS. Repeat foreclosures are either failed loan modifications, or loans that banks were attempting to modify but couldn't.
"This large amount of foreclosures that have been sitting out there, with borrowers not making payments for an extended period of time, this may be coming to an end," says LPS' Herb Blecher. "This is what the market is looking for."
That's because while painful to housing in the short term, moving the huge pipeline of delinquent loans to their inevitable end will help the overall market in the long term. There are nearly 4 million loans now in some stage of delinquency which have not even entered the foreclosure process. Banks are modifying loans more aggressively now, but many of these mortgages simply cannot be saved, and the sooner they are processed and new buyers are found for the properties, the sooner overall home prices can recover.
"It's the resolution of the crisis. It started with a flood of new troubled loans, bottlenecks presented themselves as delinquent loans piled up. "The necessary resolution before we can get back to a healthy market is that that inventory goes away," says Blecher.

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The new surge in foreclosure starts consequently created an equal surge in foreclosure sales, that is bank repossessions or short sales (when the bank allows the property to be sold for less than the value of the mortgage. Foreclosure sales rose 29 percent month to month in January, indicating that there will be a new surge of distressed properties coming to the housing market in the next few months, as banks try to sell these homes.
While the pipeline is moving, there is still a stark contrast between states that require a judge in the foreclosure process and states that do not. Foreclosure sales in non-judicial states outnumbered those in judicial states by three to one, according to LPS. But signs are that even judicial states are ramping up, with foreclosure starts increasing twice as much as they did in non-judicial states in January.
While new mortgage delinquencies are falling, the backlog of distress is large. More than 40 percent of loans in foreclosure are more than two years past due, and judicial states have 63 months of foreclosure inventory to work through. Of course that's better than last February, when foreclosure inventories hit an all-time high of 147 months.

Will 2012 begin the unclogging of 6,000,000 distressed properties?

Over 40 percent of the 2 million active foreclosures stand with no payment in over two years and some with three years and more. Foreclosure starts surge 28 percent in last month of data. Mid-tier markets in Los Angeles and Orange County contract severely in 2011.


The housing market is clogged like backed up plumbing in an old building.  The shadow inventory is still very present even though visible inventory declined last year.  It seems like we are diving back into the rabbit hole where information is disguised and bad news is spun as being good.  Take for example the number of homes actively in foreclosure.  Early in 2009 we had roughly 2,000,000 homes actively in foreclosure.  The number today?  2,000,000.  The Catch 22 of the giant bank bailouts and financial shell game was the bet (hope) that housing prices would have gone back up after five years especially with trillions of dollars funneled into the banking sector.  I mean what can go wrong when you trust banks with housing right?  The reality is sinking in that home prices are going nowhere but down unless household incomes rise and that is why we saw foreclosure starts surge last month.  The shadow inventory is coming online and that means lower prices.  Don’t think this is a shell game?  Over 40 percent of the 2,000,000 foreclosures have not had a payment in two years.  This isn’t even factoring in the 4 million delinquent loans that are working their way into the REO side of the equation.

The current state of shadow inventory
It is always helpful to see where things stand today in regards to the distressed inventory pipeline:
distressed inventory pipeline shadow inventory march 2012
Over 2 million loans are actively foreclosed (ether with a notice of default filed, scheduled for auction, or flat out owned by the bank as REOs).  Another 4 million are delinquent bringing the total distressed inventory pipeline to over 6 million.  This number sounds familiar because it really hasn’t moved in well over a year (like pretending the toilet magically unplugged itself if you simply choose not to flush it).
The best way to envision this is by looking at the length some of the homes have been in foreclosure:
foreclosures over 2 years old
Source:  LPS
You see the orange and blue above?  This is what happens when your strategy involves ignoring the problem.  Home prices are still largely inflated in many parts of the country including California.  Take a look at how backed up things have gotten:
“(Chicago Tribune) Almost three years after she last paid the mortgage, Linda Ganguzza remains in her New Milford, N.J., home, one of many troubled homeowners caught in a drawn-out foreclosure process.
“I have no idea where I stand, how much longer I have,” said Ganguzza, a 58-year-old nurse, who says her divorce left her unable to afford the home where she raised three children. “Do I move, do I hang tough, do I talk to the bank?”
Trillions of dollars to banks and the best strategy they came up with was simply ignore the problem and keep paying those big bonuses to all those investment bankers that setup this mess.  We’ll talk about the collapse in the mid-tier for California shortly but let us keep breaking down the distressed pipeline.
Foreclosure starts and sales sharply up
Showing signs of a movement in the distressed pipeline foreclosure starts and sales are up sharply in the latest data:
Source:  LPS
Foreclosure starts jumped up by 28 percent showing a sign of some movement in 2012.  Keep in mind that foreclosure sales typically sell for lower prices.  This is what banks have been trying to avoid for half a decade now.  This is also why we have millions of homes in the shadow inventory in spite of trillion dollar bailouts and artificially low interest rates.  What good is a low interest rate if household incomes are stagnant or falling?
The collapse of the mid-tier market
Redfin has some nice charts on the collapsing mid-tier market in Los Angeles and Orange Counties.  Every tier of Los Angeles and Orange County is moving back lower again:
Source:  Redfin
The above chart reflects this:
December 2011 (latest data)
Month to Month: Down 1.1%
Year to Year: Down 5.2%
Prices at this level in: August 2003
Peak month: September 2006
Change from Peak: Down 40.8% in 63 months
Low Tier: Under $289,982
Mid Tier: $289,982 to $474,017
Hi Tier: Over $474,017
Redfin then adds this chart that shows the obvious trend:
Tens of thousands that bought in the summer of 2010 thinking it was bottom missed the second round.  Take a $400,000 home bought with a 3.5 percent FHA insured loan.  Not only is that down payment gone, but where will that 5 to 6 percent come from if they decide to sell?  They are merely one of the 35 percent of California homeowners that are in negative equity or near negative equity.  The property ladder days of the last decade are long gone.
All of this of course makes sense.  Those that try to ignore area incomes are delusional and drinking their own Kool-Aid.  Of course local household incomes count and when ratios get out of whack like they did, prices will adjust even if it means severe corrections (the Case-Shiller LA/OC data set is down 40 percent from the peak by the way).  Buying volume is low because people need only look at their wages or bank accounts and home prices in certain areas will appear expensive still.  People fall into manias in a lemming like pattern but gain their sanity one by one.
The housing pipeline is beginning to unclog and shadow inventory in mid-tier markets is likely to depress prices well into 2012.  The only thing that will change this is a sudden surge in good paying jobs and wage increases.  Nationwide with a median price home of roughly $150,000 prices may dip slightly this year but they are more in line with household incomes.  In mid-tier markets like the Los Angeles/Orange County Case-Shiller range prices are very likely to fall yet again as it is clear a movement in shadow inventory is now starting and prices have a good way to go before they are in line with local income metrics.
Any predictions on where the Case-Shiller will be one year from now?  Nationwide?  Los Angeles?

Marc Faber - When the Government Will Take Your Gold

Official: LA Scam Defendant Dies in French Jail

Bruce Friedman, a former Los Angeles man charged with running a $200 million real estate investment fraud scheme, died in a French prison while appealing his extradition, an official said Tuesday.
The U.S Embassy official in Paris, who spoke to The Associated Press on condition of anonymity, said he had no further information and referred questions to the U.S. Department of Justice.
Thom Mrozek, a spokesman for the U.S. attorney's office in Los Angeles, said the office was awaiting confirmation of Friedman's death.
Friedman, 62, owned Diversified Lending Group Inc., based in the Sherman Oaks area of Los Angeles, which claimed to make money by buying, rehabilitating and renting out properties across the United States.
Friedman's company promised annual returns of up to 12 percent and bilked hundreds of investors, federal prosecutors contended.
Authorities said Friedman's business took in $228 million and investors lost nearly $200 million.

Some of the money was used to repay early investors in a classic Ponzi scheme while the rest was plowed into other business ventures — some affiliated with Friedman's family and friends — and a luxurious lifestyle for Friedman that included pricey cars, homes and jewelry, authorities contended.
Friedman donated hundreds of thousands of dollars to charity and had pledged $10 million to help build a children's museum in the San Fernando Valley.
The unfinished Children's Museum of Los Angeles filed for bankruptcy in 2009 after a judge froze his assets at the request of the federal Securities and Exchange Commission, which sued Friedman over the purported scheme.
In 2010, a federal grand jury indicted Friedman on 23 counts of mail fraud, wire fraud and money laundering. He could have faced up to 390 years in federal prison if convicted of all charges.
Friedman had been jailed since his arrest in September 2010 outside a hotel in Cannes. It could not immediately be determined if he had a lawyer.
Patricia Hank of Calabasas lost $300,000 in life savings.
"All I can say is, I'm not sorry" that Friedman died, she told the Los Angeles Times ( ). "That was my entire retirement."
David Gill, a court-appointed receiver who has been trying to recover some of the investors' money, told the Times the effort will continue despite Friedman's death.
AP writer Elaine Ganley contributed to this report from Paris.

EU Austerity Madness

Stephen Lendman, Contributing Writer
Activist Post

European/American austerity assures a 1% wealth grab at the expense of all others. 

Prioritizing banker payments causes debt bondage, human misery, economic wreckage, and eventual collapse. What can't go on forever, won't. It's not rocket science; it's fact.

Economies thrive on productive economic growth. It includes public sector infrastructure investment in transportation, research and development, roads and bridges, education, healthcare, and other vital areas. Sacrificing it for bankers and other vulture investors causes Greek-type crises.

Financialization highlights "the great problem of our time," says Michael Hudson. He defines is as "capitalizing every form of surplus income and pledging it for bank loans at the going interest rate, personal income over and above basic expenditures, corporate income over and above cash flow....and whatever government can collect in taxes over and above its outlay."

Banker nirvana depends on securing all economic surplus as interest, says Hudson, or in hard times as bailouts. However, doing it "leaves nothing over for living standards and what (18th and 19th century) economists (called) human capital formation (training and education) required for labor productivity to rise." Economies need it to thrive.

There's also "no cash left over for corporations to invest in new tangible capital formation, and no government spending for infrastructure or other social and economic needs."

 Hudson talks about a financialization-caused economic/political "Dark Age," "a form of neo-feudalism." Industrial capitalism and people suffer to enrich financial oligarchs. Austerity becomes policy. Debt peonage and hard times follow. Jobs are cut, wages slashed, and living standards shrink. Prioritized banker demands sacrifice fundamental human needs.

EU Fiscal Pact Insanity

The EU's latest Fiscal Pact demands more. Terms call for constitutional debt limits. Exceeding 3% of GDP brings European Court suits. Doing so triggers automatic penalties, at least according to pact mandates.

Eurozone monetary union failed. Europe's Exchange Rate Mechanism (ERM) was introduced as part of the European Monetary System (EMS) to propel the continent to one European currency unit (ECU).

ERM never worked. ECU's failing. At issue is duplicity, conflicts of interest, and uniting 17 dissimilar countries under rigid euro straightjacket rules. Doing so usurps their monetary and fiscal autonomy disastrously. 

Bernard Connolly got it right. His 1995 book titled, The Rotten Heart of Europe: The Dirty War for Europe's Money called it a harebrained idea doomed to fail, saying it cost him his job as EU monetary affairs department head. He's regarded as the foremost expert on European economic, monetary, and political integration.

Months before the euro's 1998 introduction, he predicted that one or more of Europe's weakest countries would face rising budget deficits, troubled economies, and a "downward spiral from which there is no escape unaided. When that happens, the country concerned will be faced with a risk of sovereign default."

In late 2007, the great unraveling began. Massive liquidity infusions delay eventual day of reckoning inevitability. The longer it is extended, the worse the fall. It's just a matter of time.

New Fiscal Pact provisions mandate austerity. EU nations have no say. Ordinary people have none whatsoever. Britain and Czechoslovakia opted out, not for populist reasons. Under the Bank of England, the UK retains monetary sovereignty. Both countries retain fiscal policy control.

 They'll enforce austerity their own way. Mandating more across Europe assures harder than ever hard times. Ordinary people suffer most. Recession's already biting. Europe's healthiest economy feels it. Germany's 2011 Q IV GDP contracted 0.25%. In January, its retail sales slumped 1.6%. Consensus expected +0.5%. Eurozone industrial activity contracted for the seventh consecutive month.

China's Purchasing Managers Index (PMI) showed weakness. Its growth target was cut to 7.5% from 8%. High oil prices are taking a toll. US gasoline consumption slumped 7% year-over-year. Imagine the effect of expected $5 dollar gas by summer or late spring. Real, not manipulated, joblessness keeps growing.

What affects Germany impacts the continent. Look for Europe's recession to deepen and spread. Unemployment's rising. In January, it reached double digits, its highest level since the euro was introduced.

Youth joblessness is especially affected. In Greece and Spain it's 50% or higher. Fiscal Fact austerity assures greater hardship, including higher unemployment, lower wages, eroded benefits, and less ability to survive. Mandating it is cruel and insane.

Decades of social progress is lost. Ordinary people more than ever are on their own to sink or swim. In the hardest hit countries, people are voting with their feet and leaving. Capital flight's joining them. Fiscal Pact madness assures economic decline, widespread deprivation, and social unrest.

At the same time, ECB Long Term Refinancing Operation policy (LTRO) gives banks free money, but not without unintended consequences. Expect eventual disruptive public anger. Deprived people take only so much. Tolerance thresholds eventually breach. The fullness of time will tell when.

For years, Progressive Radio New Hours hour regular, Bob Chapman, explained Eurozone madness and eventual Greek default. He calls the last four years "a warm up" for greater future trouble.

Greece, other troubled economies, and those heading there can't keep borrowing more than their revenue stream. Doing so increases indebtedness. Extraordinary levels can't be repaid. Entrapped Greece has no choice but to default and exit euro straightjacket rules.

S & P cut Greece's credit rating to selective default, its lowest level because repaying it is impossible. Moreover, European banks won't lend to each other. Speculation's safer. Unless business lending increases, economic growth won't happen.

So far, not a glimmer's in sight. Free ECB money achieves Pyrrhic victories at the expense of ultimate unwinnable ones. Follow bond, not equity, buyers. Their world view sees dark storm clouds coming. Bet on it.

Stephen Lendman lives in Chicago and can be reached at

Also visit his blog site at and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.

Jim Rogers - Obama, Romney, or Santorum?

Why an MRI Costs $1,080 in America and $280 in France

here is a simple reason health care in the United States costs more than it does anywhere else: The prices are higher.
That may sound obvious. But it is, in fact, key to understanding one of the most pressing problems facing our economy. In 2009, Americans spent $7,960 per person on health care. Our neighbors in Canada spent $4,808. The Germans spent $4,218. The French, $3,978. If we had the per-person costs of any of those countries, America's deficits would vanish. Workers would have much more money in their pockets. Our economy would grow more quickly, as our exports would be more competitive.
There are many possible explanations for why Americans pay so much more. It could be that we're sicker. Or that we go to the doctor more frequently. But health researchers have largely discarded these theories. As Gerard Anderson, Uwe Reinhardt, Peter Hussey and Varduhi Petrosyan put it in the title of their influential 2003 study on international health-care costs, "it's the prices, stupid."
As it's difficult to get good data on prices, that paper blamed prices largely by eliminating the other possible culprits. They authors considered, for instance, the idea that Americans were simply using more health-care services, but on close inspection, found that Americans don't see the doctor more often or stay longer in the hospital than residents of other countries. Quite the opposite, actually. We spend less time in the hospital than Germans and see the doctor less often than the Canadians.
"The United States spends more on health care than any of the other OECD countries spend, without providing more services than the other countries do," they concluded. "This suggests that the difference in spending is mostly attributable to higher prices of goods and services."
On Friday, the International Federation of Health Plans - a global insurance trade association that includes more than 100 insurers in 25 countries - released more direct evidence. It surveyed its members on the prices paid for 23 medical services and products in different countries, asking after everything from a routine doctor's visit to a dose of Lipitor to coronary bypass surgery. And in 22 of 23 cases, Americans are paying higher prices than residents of other developed countries. Usually, we're paying quite a bit more. The exception is cataract surgery, which appears to be costlier in Switzerland, though cheaper everywhere else.
Prices don't explain all of the difference between America and other countries. But they do explain a big chunk of it. The question, of course, is why Americans pay such high prices - and why we haven't done anything about it.
"Other countries negotiate very aggressively with the providers and set rates that are much lower than we do," Anderson says. They do this in one of two ways. In countries such as Canada and Britain, prices are set by the government. In others, such as Germany and Japan, they're set by providers and insurers sitting in a room and coming to an agreement, with the government stepping in to set prices if they fail.
In America, Medicare and Medicaid negotiate prices on behalf of their tens of millions of members and, not coincidentally, purchase care at a substantial markdown from the commercial average. But outside that, it's a free-for-all. Providers largely charge what they can get away with, often offering different prices to different insurers, and an even higher price to the uninsured.
Health care is an unusual product in that it is difficult, and sometimes impossible, for the customer to say "no." In certain cases, the customer is passed out, or otherwise incapable of making decisions about her care, and the decisions are made by providers whose mandate is, correctly, to save lives rather than money.
In other cases, there is more time for loved ones to consider costs, but little emotional space to do so - no one wants to think there was something more they could have done to save their parent or child. It is not like buying a television, where you can easily comparison shop and walk out of the store, and even forgo the purchase if it's too expensive. And imagine what you would pay for a television if the salesmen at Best Buy knew that you couldn't leave without making a purchase.
"In my view, health is a business in the United States in quite a different way than it is elsewhere," says Tom Sackville, who served in Margaret Thatcher's government and now directs the IFHP. "It's very much something people make money out of. There isn't too much embarrassment about that compared to Europe and elsewhere."
The result is that, unlike in other countries, sellers of health-care services in America have considerable power to set prices, and so they set them quite high. Two of the five most profitable industries in the United States - the pharmaceuticals industry and the medical device industry - sell health care. With margins of almost 20 percent, they beat out even the financial sector for sheer profitability.
The players sitting across the table from them - the health insurers - are not so profitable. In 2009, their profit margins were a mere 2.2 percent. That's a signal that the sellers have the upper hand over the buyers.
This is a good deal for residents of other countries, as our high spending makes medical innovations more profitable. "We end up with the benefits of your investment," Sackville says. "You're subsidizing the rest of the world by doing the front-end research."
But many researchers are skeptical that this is an effective way to fund medical innovation. "We pay twice as much for brand-name drugs as most other industrialized countries," Anderson says. "But the drug companies spend only 12 percent of their revenues on innovation. So yes, some of that money goes to innovation, but only 12 percent of it."
And others point out that you also need to account for the innovations and investments that our spending on health care is squeezing out. "There are opportunity costs," says Reinhardt, an economist at Princeton. "The money we spend on health care is money we don't spend educating our children, or investing in infrastructure, scientific research and defense spending. So if what this means is we ultimately have overmedicalized, poorly educated Americans competing with China, that's not a very good investment."
But as simple an explanation as "the prices are higher" is, it is a devilishly difficult problem to fix. Those prices, for one thing, mean profits for a large number of powerful - and popular - industries. For another, centralized bargaining cuts across the grain of America's skepticism of government solutions. In the Medicare Prescription Drug Benefit, for instance, Congress expressly barred Medicare from negotiating the prices of drugs that it was paying for.
The 2010 health-reform law does little to directly address prices. It includes provisions forcing hospitals to publish their prices, which would bring more transparency to this issue, and it gives lawmakers more tools and more information they could use to address prices at some future date. The hope is that by gathering more data to find out which treatments truly work, the federal government will eventually be able to set prices based on the value of treatments, which would be easier than simply setting lower prices across-the-board. But this is, for the most part, a fight the bill ducked, which is part of the reason that even its most committed defenders don't think we'll be paying anything like what they're paying in other countries anytime soon.
"There is so much inefficiency in our system, that there's a lot of low-hanging fruit we can deal with before we get into regulating people's prices." says Len Nichols, director of the Center for Health Policy Research and Ethics at George Mason University. "Maybe, after we've cut waste for 10 years, we'll be ready to have a discussion over prices."
And some economists warn that though high prices help explain why America spends so much more on health care than other countries, cutting prices is no cure-all if it doesn't also cut the rate of growth. After all, if you drop prices by 20 percent, but health-care spending still grows by seven percent a year, you've wiped out the savings in three years.
Even so, Anderson says, "if I could change one thing in the United States to bring down total health expenditures, it would definitely be the prices."

View an interactive graphic: The High Cost of Medical Procedures in the US.

BOATLIFT, An Untold Tale of 9/11 Resilience

Poverty in America -- From Riches to Rags (Original Content)

Like a pebble dropped in a pond, everything we do affects the people in our lives, and their reactions in turn affect others. The choices we make will have far-reaching consequences. Each of us carries within us the capacity to change the world in small ways for better or worse.

I once read that, "short of genius, a rich man cannot imagine poverty." Perhaps. But these days, wealthy imaginations are not as narrow as they used to be as all walks of life (the rich included) witness the massive poverty increase in the land of plenty. Could it be that, for most Americans (the 99%), the blessed era of fruitful sustainability is coming to a close?

Numbers don't lie. The economic injustice that fuels poverty is very real. And with unemployment soaring, even those lucky enough to have jobs are either working part-time or lumbering through long hard hours for a paltry check that is rarely enough to pay the bills. This is not quality of life. This is not the way it's supposed to be in a civilized society. Along with the physical aspects, chronic depression and loneliness is an ever-present life-degrading condition during hard times, and the numbers are staggering. In fact, with economic absurdities piled upon stress, it makes a strong emotional case that fragile minds now feel like worn-out slaves profoundly living on a huge modern-day plantation. This is especially true with crushing debt burdens, high inflation, job lay-offs and ongoing austerity measures in this full-blown era of psycho-economic "globalization." It doesn't take a mental giant to figure out how the system works and for whom. For details on what to expect here in the U.S., see the tragic mess in Greece. It's not pretty. 
The reality on the ground is grave. People are homeless and way too many bread baskets are empty. All walks of life are affected, including children, the elderly and the disabled. Inequities continue to widen and people are without crucial medicine, dental, vision or other basic healthcare needs. For the penniless, the sick and the disfranchised -- government policymakers are definitely not up to snuff when it comes to serving our best interest.

However, poverty has awakened the national psyche. All doubt has melted away and we now know for sure that most politicians are blowhards without virtue, offering little more than "fascism" for a corporate empire filled with swelled egos who woefully believe the rest of us are small inferior bottom-feeders ... and that big ol' them deserve more, more and more. Although our representatives try to convey the foolish idea that they are our champions, we know who is bearing the blunt of policies that slash at already threadbare safety nets.     
Numbers don't lie. According to census data, 47 million Americans now live below the poverty line -- the most in half a century (since the last great depression) -- fueled by years of high unemployment, home foreclosures, the stock market crash and a diminishing manufacturing base that has jettisoned American livelihoods in every direction outside our border. There's no pretending anymore, this is the economic agenda favored by transnational corporations and the folks on Wall Street -- as businesses, services and other commerce drift away from our shores. And with no good jobs to be had, opportunity will continue be out of reach until we reverse course. Therefore, a great American triumph must be realized. We must rise above the destructive ideology of "outsourcing" ... and rebuild America's manufacturing base and put Americans back to work. And it must be done now!
And so the story goes -- the "news media" has little concern for publicizing the struggles of the little guy, regardless of the consequences that those cited above have engineered. Because, when it comes to playing us like like a fiddle under the big tent, media clowns perform on cue. Indeed, they have taken their "corporatutional" oath to do us harm in all sectors of newsworthy information, but it really hits home -- economically -- when it comes to their silence on America's manufacturing base "fire-sale" to foreign nations.
In terms of their commitment to such kindred spirits such as Mr. Rupert (wiretap) Murdock, the media's endless spy/spin cycle will not be receding anytime soon. However, once in a while a few discordant images gets through the laughable theme of a robust economic "recovery." It's usually not music to corporate ears, but nonetheless ... it does capture the effect of today's widespread social sickness that surrounds us like a thick fog. Here's a few blunt snapshots rarely caught in that disappearing lens called "mainstream" media.

Tent City Las Vegas
For the Children: The ongoing economic crisis has negatively affected the livelihoods of millions of Americans, but the effect it has on children and youth is especially tough to bear. According to the U.S. Bureau of Labor Statistics (2012), the unemployment rate is 8.3 percent as of January 2012. Of course, we already know this number is low-balled at best. For example...
  • U.S. Census data reveals that from 2009 to 2010, the total number of children under age 18 living in poverty increased to 16.4 million from 15.5 million. Child poverty rose from 20.7 percent in 2009, to 22 percent in 2010, and this is the highest it has ever been since 1993.
  • Racial and ethnic disparities in poverty rates persist among children. The poverty rate for Black children was 38.2 percent; 32.3 percent for Hispanic children; 17 percent for non-Hispanic White children; and 13 percent for Asian children.
  • The National Center for Children in Poverty reports that 17.2 million children living in the U.S. have a foreign-born parent, and 4.2 million children of immigrant parents are poor. It is reported that child poverty in immigrant families is more closely related to low-wage work and barriers to valuable work supports.
  • The Population Reference Bureau (2010) reports that 24 percent of the 75 million children under age 18 in the U.S. live in a single-mother family. The poverty rate for children living in female-householder families (no spouse present) was 42.2 percent in 2010; 7 in 10 children living with a single mother are poor or low-income, compared to less than a third (32 percent) of children living in other types of families. A staggering 50.9 percent of female-headed Hispanic households with children below 18 years of age live in poverty (48.8 percent for Blacks; 31.6 percent Asian, and 32.1 percent non-Hispanic White).
  • Single-mother headed households are more prevalent among African American and Hispanic families contributing to ethnic disparities in poverty.
The number of those affected speaks for itself. Poverty is color-blind.
I have no catchy euphemisms or metaphors to describe the horrific hardship that has shattered the bond-of-trust between our nations' people and those who govern in public office. Shame on them! And although some of them do have their priorities in the right place, sadly, there is not enough of them to create the change we so desperately need. Overwhelmingly, most representatives have sold us out and we are nearly destroyed because of it. The poor souls pictured here will always be in my prayers. To some degree, I have exploited them, but for a worthy purpose in order to draw attention to their plight. Their struggle is our struggle, it's a full-blown human-rights disaster that must be addressed by all of us.  
Our Forgotten Solders: And so it would seem, nothing is sacrosanct in this degenerating environment. Even our brave soldiers returning home from battle are mystified at what has happened to their country while they were gone. Most are completely blown away to say the least! Images such as this, the military routinely sweeps under the rug, because It's not exactly a moral booster for "enlistment" purposes.
The rate of homeless veterans is a manifestation on the rise. Only eight percent of the general population can claim veteran status, but nearly one-fifth of the homeless population are veterans. Based on statistics gathered by the National Coalition for Homeless Veterans, there are currently over 67,000 homeless veterans in this country and this number rises higher each day. Roughly 56 percent of all homeless veterans are African American or Hispanic, despite only accounting for 12.8 percent and 15.4 percent of the U.S. population respectively. About 1.5 million other veterans, meanwhile, are considered at risk of homelessness due to poverty, lack of support networks, and dismal living conditions in overcrowded or substandard housing.

In addition to the complex set of factors influencing all homelessness -- extreme shortage of affordable housing, livable income and access to health care -- a large number of displaced and at-risk veterans live with lingering effects of post-traumatic stress disorder (PTSD) and substance abuse, which are compounded by a lack of family and social support networks. Although this obligation is not being met, A top priority for homeless veterans should be secure, safe and clean housing that offers a supportive environment free of drugs and alcohol. Having a father who still suffers the lasting affects of PTSD (a most honorable combat veteran who served during WWII and Korea), I can relate to the importance of providing a safe, supportive environment. 

Also, In a 2009 article published in USA Today, it was reported that veterans stayed in shelters longer, on average, than non-veterans. The median length of stay for single veterans was 21 days, while non-veterans stayed for 17 days. Most homeless veterans -- 96% -- are alone rather than part of a family. Among all homeless people, 66% are without families. The 136,334 veterans who spent at least one night in a shelter during the year studied amount to one of every 168 veterans in the USA and one of every 10 veterans living in poverty.

I would add, many veterans became financially devastated while serving our country in foreign combat zones. To me, this is especially unacceptable when we consider the sacrifices they made.
There is a better way for us to move forward. Issues such as poverty, corruption, collapse, homelessness, war, starvation and the like appear to be "symptoms" born out of an outdated social structure. Our principal focus should include recognizing that the majority of social problems which plague our nation at this time are the result of institutional corruption, corporate monopolies, austerity political policy and a flaw of irresponsible management from the top down.
We need to find optimized solutions, and we must to do it now! And if that means marching in the street to get it, so be it. Our allegiance should be to each other in the grand scheme of things and we should not rely on traditional political platforms or parties to do it for us. No one should be left behind. The path forward is self-evident, we must tackle the challenges ahead and make sure all basic resources are affordable and available to everyone, not just a select few at the top of the food chain.
We Are One Humanity.
We are all connected in this tapestry called "life." Like a pebble dropped in a pond, everything we do affects the people in our lives, and their reactions in turn affect others. The choices we make will have far-reaching consequences. Each of us carries within us the capacity to change the world in small ways for better or worse. I say let us be the heroes we always hoped we could be. Let's heal humanity! God bless.

Vincent L. Guarisco is a freelance writer from Arizona, a contributing writer for many web sites, and a lifetime founding member of the Alliance of Atomic Veterans. The 21st century, once so full of shining promise, now threatens to force countless millions of us at home and abroad into a dark abyss of languishing poverty and silent servitude; a lowly prodigy of painful struggle and suffering that could stream for generations to come. I'm wishing for a miracle, before it is too late, the masses will figure it out and will stand as one and roar. So, pass the word -- it's past time to take back what is ours -- the American Dream where the pursuit of happiness, the ability to live in a free and peaceful nation is a reality. We bought it, and we paid for it. It's time to take it back.