Matt Stoller Discusses the Overconcentration of Economic and Political Power in Many American Industries

I've followed Matt Stoller for months and I now support his Substack newsletter. He discusses the over-concentrations of power in many places. This is incredibly important to having a meaningful understanding about what is going on in Washington DC. Mere Supply and Demand does NOT explain what is going on, contrary to many economists.

Krystal and Saagar talk at length with policy expert Matt Stoller about the monopolization of the American economy, supply chain shocks, corruption in government, consumer culture, meat packing consolidation, the anti-trust movement and more.

From Stoller's first Substack newsletter:

You see, I was taught basic economics by Martin Feldstein at Harvard, and he told us that banks and corporations were neutral technocratic institutions. And I believed him, because I was an arrogant Harvard student who trusted economists. Witnessing the policy choice to concentrate wealth and power during the Wall Street bailouts, and talking to lots of people in foreclosure who didn’t get a bailout, broke me of that illusion.

After you learn about Too Big to Fail banks, it’s hard not to look around and begin seeing that Too Big to Fail is everywhere. Eventually I came to read Cornered by Barry Lynn, and that book helped connect the dots and set me on the path to researching my own book, Goliath. (Later I found out Feldstein was on the board of AIG, which was one of the central villains of the financial crisis.)

What’s your story? And what monopolies are you noticing these days?

Continue ReadingMatt Stoller Discusses the Overconcentration of Economic and Political Power in Many American Industries

The Consequences of Not Belonging to any Political Tribe

What is it like to not feel part of any political tribe? Mostly, it is to be dismayed to hear lies from the right and then lies of the left. It is to have a seat near the net of the tennis court, looking to the left, then the right, over and over, as lies are zinged back and forth. The party in power now, the Democrats, are certainly doing their part, whether it be immigration, COVID, Russia-Trump, abolishing the police will keep cities safer. And now there is the Democrat claim about Biden's economic package:

They are insisting that their plans, which are still in flux but amount to a call for some $4 trillion in spending over two bills, have no real costs at all—or that the costs should not be factored in, because they are "unfair and absurd."

As if $4 trillion will not risk massive inflation. As if $4 trillion will be completely paid for.

I'm not taking a position on whether parts of these packages make sense for the U.S. My concern is that the risks of these packages are being actively suppressed. I have very little respect for Joe Manchin, but I think he's correct when he claims that the current proposal amounts to "fiscal insanity." We are not having any meaningful national conversation about what is really in these bills and the extent of economic risk of committing $3.5 trillion to those things.  This, from the remorseless political party that threw the working class overboard decades ago.

This is simply the most recent example of a system that is completely broken with no hope of repair. It's a system where big corrupt campaign money and ideology drive the decisions, where inconvenient truths are ignored and suppressed and where most voters line up in ignorance to cheer their respective teams.

In four years, we might see the Republicans taken over, with their own brand of fiscal and ideological insanity. I truly see no end in sight.

This is the sort of thing that led George Carlin to indicate that he no longer had "a stake in the outcome."  I wish I could claim that everything is going well for our country, but I can't.

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About Our Corrupt COVID Supply Chain

Matt Stoller's antitrust blog should be required reading for every American. Today's topic is the corrupt system behind COVID medical shortages. Here's an excerpt:

Today, corruption in these markets is so extreme that hospital executives themselves are often offered a cut of the fees from GPOs. In 2013, one analyst said that “many hospital executives who are part of the Premier alliance have learned to rely on that share back as an integral part of their annual compensation.” In other words, hospitals are buying supplies at inflated prices, and those suppliers use some of that extra money in direct bribes to hospital executives.

The legalization of kickbacks happened as a series of mergers in the 1990s consolidated power within the industry. In 1995, Premier Health Alliance, American Healthcare Systems, and SunHealth Alliance merged into the nation’s largest GPO, Premier. By 2017, the giants in the industry - Vizient, Premier, HealthTrust, and Intaler - came to manage $300 billion of hospital purchasing for 5000 health systems, or 90% of total medical supplies in the United States. These GPOs have deals with the three major distributors - McKesson, AmerisourceBergen and Cardinal Health - which precludes any smaller distributors from getting into the business. At this point, 90% of generic medicines are bought by just four firms.

And this consolidation and restructuring of hospital buying has ruined the American supply chain, and prevented the ability to rebuild it.

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About the Supposed Meritocracy . . .

Matt Taibbi discusses the "meritocracy," reviewing Michael Sandel's new book, "The Tyranny of Merit." He describes the divide between the those with and without college degrees as stark. He describes this entire topic as unsettling for everyone along the political spectrum. An excerpt from his article, which is titled "Does America Hate the "Poorly Educated"? Michael Sandel's "The Tyranny of Merit" doesn't say so, but the pandemic has become the ultimate expression of upper-class America's obsession with meritocracy":

As Sandel notes, Trump was wired into these politics of humiliation and never invoked the word “opportunity,” which both Obama and Hillary Clinton made central, instead talking bluntly of “winners” and “losers.” (Interestingly, Bernie Sanders also stayed away from opportunity-talk, focusing on inequities of wealth). Trump understood that huge numbers of voters were tired of being told “You can make it if you try” by a generation of politicians that had not only “not governed well,” as Sandel puts it, but increasingly used public office as their own route to mega-wealth, via $400,000 speeches to banks, seats on corporate boards, or the hilariously auspicious, somehow not-illegal stock trading that launched more than one member of congress directly into the modern aristocracy.

The Tyranny of Meritocracy describes the clash of these two different visions of American society. One valorizes the concept of social mobility, congratulating the wealthy for having made it and doling out attaboys for their passion in wolfing down society’s rewards, while also claiming to make reversing gender and racial inequities a central priority. The other group sees class mobility as entirely or mostly a fiction, rages at being stuck sucking eggs in what they see as a rigged game, and has begun to disbelieve every message sent down at them from the credentialed experts above, even about things like vaccines.

The eternal squeamishness Americans feel about class will prevent this topic from getting the attention it deserves, but the insane witches’ brew of rage, mendacity, and mutual mistrust Sandel describes at the heart of American culture is no longer a back-burner problem. Tension over who deserves what part of society’s rewards, and whether higher education is a token of genuine accomplishment or an exclusive social rite, has become real hatred in short order. In the pandemic age, Americans on either side of the educational divide have moved past rooting for each other to fail. They’re all but rooting for each other to die now, and that isn’t a sentiment either side is likely to forget.

Continue ReadingAbout the Supposed Meritocracy . . .

Greenwald: Cost-Benefit Analysis of COVID Issues Deemed Off-Limits

Glenn Greenwald writes:

In virtually every realm of public policy, Americans embrace policies which they know will kill people, sometimes large numbers of people. They do so not because they are psychopaths but because they are rational: they assess that those deaths that will inevitably result from the policies they support are worth it in exchange for the benefits those policies provide. This rational cost-benefit analysis, even when not expressed in such explicit or crude terms, is foundational to public policy debates — except when it comes to COVID, where it has been bizarrely declared off-limits.

If we treated car safety the same absolutist way that we treat COVID safety, we would ban automobiles.

In the above video (min 22) Greenwald points out that we are entirely ignoring the mental health damage being done by lockdowns, especially the mental distress and damage caused when children are prevented from attending school in person. That said, don't ignore the small total deaths by COVID among children, even in the era of the Delta Variant.

Continue ReadingGreenwald: Cost-Benefit Analysis of COVID Issues Deemed Off-Limits