The US Chamber of Commerce: Reliably, Irredeemably Wrong
What if I told you I’d found a political group that for a hundred years had managed to be absolutely right on every crucial political issue? A political lodestone, reliably pointing toward true policy north at every moment.
Sorry. But I have something almost as good: a group that manages to always get it wrong. The ultimate pie-in-the-face brigade, the gang that couldn’t lobby straight.
From the outside, you’d think the US Chamber of Commerce must know what it’s doing. It’s got a huge building right next to the White House. It spends more money on political campaigning than the Republican and Democratic National Committees combined. It spends more money on lobbying that the next five biggest lobbyists combined. And yet it has an unbroken record of error stretching back almost to its founding.
Take the New Deal, which historians have long since credited as saving capitalism in the U.S. FDR was dealing with a nation ruined by Wall Street excess—a quarter of the country unemployed, Americans starving and hopeless. He gave his first fireside chat of 1935 on April 28, and outlined a legislative program that included Social Security. The next morning , a prominent official of the Chamber of Commerce accused Roosevelt of attempting to ‘Sovietize’ America; the chamber adopted a resolution “opposing the president’s entire legislative package.”
Fast forward to the next great challenge for America. FDR, having brought America through the Depression, was trying to deal with Hitler’s rise. In the winter of 1941, with the British hard-pressed to hold off the Germans, FDR proposed what came to be called the Lend-Lease program, a way of supplying the allies with materiel they desperately needed.
Only 22% of Americans opposed the Lend Lease program—they could see who Hitler was—but that sorry number included the Chamber of Commerce. The lead story in the New York Times for February 6, 1941 began with the ringing statement from the Chamber’s president James S . Kemper that “American business men oppose American involvement in any foreign war.”
It’s not just that this was unpatriotic; it was also plain stupid, since our eventual involvement in that “foreign war” triggered the greatest boom in America’s economic history. But it’s precisely the kind of blinkered short-sightedness that has led the US Chamber of Commerce astray over and over and over again. They spent the 1950s helping Joe McCarthy root out communists in the trade unions; in the 1960s they urged the Senate to “reject as unnecessary” the idea of Medicare; in the 1980s they campaigned against a “terrible 20” burdensome rules on business, including new licensing requirements for nuclear plants and “various mine safety rules.”
As Brad Johnson, at the Center for American Progress, has detailed recently, the US Chamber has opposed virtually every attempt to rein in pollution, from stronger smog standards to a ban on the dumping of hazardous waste. (They’re hard at work as well trying to relax restrictions on US corporations bribing foreign governments, not to mention opposing the Lily Leadbetter Fair Pay Act). If there’s a modern equivalent of World War II, of course, it’s the fight against global warming. Again a majority of Americans want firm action, because they understand the planet has never faced a bigger challenge—but that action’s been completely blocked in Washington, and the US Chamber is a major reason why. They’ve lobbied against every effort to cut carbon, going so far as to insist that the EPA should stay out of the fight because, if the planet warmed, “populations can acclimatize via a range of range of behavioral, physiological, and technological adaptations.” That is to say, don’t ask a handful of coal companies to adapt their business plans, ask all species everywhere to adapt their physiologies. Grow gills, I guess.
There’s a reason the US Chamber always gets it wrong: they stand with whoever gives them the most cash (in 2009, 16 companies provided 55% of their budget). That means that they’re always on the side of short-term interest; they’re clinically, and irremediably, short-sighted. They recently published a list of the states they thought were “best for business,” and the results were almost comical—all their top prospects (Mississippi!) ranked at the very bottom of everything fromn education to life expectancy.
But that doesn’t mean that business is a force for evil. Though the US Chamber claims to represent all of American business, their constituency is really that handful of huge dinosaur companies that would rather lobby than adapt. Around America, the local chambers of commerce are filled with millions of small businesses that in fact do what capitalists are supposed to do: adapt to new conditions, thrive on change, show the nimbleness and dexterity that distinguish them from lumbering monopolies. As Chris Mead, in an excellent history of the local chambers, makes clear, there are a thousand instances where clear-sighted businesspeople understood the future. Who lured the first movie producers to southern California? The LA Chamber, which sent out a promotional brochure in 1907. Why was the Lindbergh’s plane called “The Spirit of St. Louis”? Because the St. Louis Chamber of Commerce raised the money—that was a pretty good call.
That’s why thousands and thousands of American businesses concerned about our energy future have already joined a new campaign, declaring that “The US Chamber Doesn’t Speak for Me.” They want to draw a line between themselves and the hard-right ideological ineptitude that is the US Chamber. Some of those businesses are tiny—insurance brokers in southern California, coffee roasters in Georgia, veterinarians in Oklahoma—and some are enormous. Apple Computer, for instance, which has…a pretty good record of seeing into the future.
There’s only one reason anyone pays attention to the US Chamber, and that’s their gusher of cash. But the Chamber turns 100 next year, and it’s just possible that a century of dumb decisions will outweigh even that pile of money. If you’re trying to figure out the future, study the US Chamber—and go as fast as you can in the opposite direction.
By: Bill McKibben, Commondreams.org, March 22, 2011
Congress And The War Powers Resolutions: Libya Airstrikes Constitutionally Legit
Under the Constitution, only Congress has the power to “declare war.” The president, however, has ample authority to use military force without a “declaration of war” where the anticipated U.S. engagement in hostilities is limited in its expected nature, scope and duration. Presidential administrations of both political parties have recognized a long tradition that supports this use of force. And Congress has acknowledged its legitimacy as well.
The authority for the president to act without specific congressional authorization is set out in two opinions of the Office of Legal Counsel. The first, issued in 1994, defends the plan to send 20,000 troops into Haiti and the second, issued in 1995, provides the legal authority for the use of air power in Bosnia. (I should note that I was head of OLC at the time these opinions were issued).
As these opinions note, the structure of the War Powers Resolution enacted by Congress necessarily presupposes the existence of unilateral presidential authority to deploy armed forces “into hostilities or into situations where imminent involvement in hostilities is clearly indicated by the circumstances.” The resolution requires that, in the absence of a declaration of war, the president must report to Congress within 48 hours of introducing armed forces into such circumstances and must terminate the use of U.S. armed forces within 60 days unless Congress permits otherwise. This structure makes sense only if the president may introduce troops into hostilities or potential hostilities without prior authorization by the Congress: the resolution regulates such action by the president and seeks to set limits to it.
President Obama has fully complied with the reporting requirements set out by Congress in the War Powers Resolution. To be sure, the resolution declares that it should not be construed to grant any new authority to the president. But it obviously assumes that the president already had such authority, and sets out reporting (and subsequent withdrawal) requirements when he exercises that power.
It has been 15 years since these OLC opinions were issued and widely discussed. In that time, Congress has continued to provide for military forces to be deployed throughout the world without placing any restrictions that would preclude their use in circumstances such as those presented by Haiti, Bosnia and Libya. Under well-established precedents endorsed by both the executive and congressional branches of the national government, there is no doubt of the legitimacy of the president’s use of force in Libya.
By: Walter Dellinger, Visiting Professor of Law, Harvard University; Former Assistant Attorney General and Head, Office of Legal Council. Article published in The Arena, Politico, March 22, 2011
The Importance of Independence: Affordable Care Act’s Independent Payment Advisory Board Key to Quality Care at Lower Cost
A year ago this week, President Barack Obama signed into law our nation’s first comprehensive health reform law, the Affordable Care Act, which not only extends health insurance protection to tens of millions of Americans but also actually reduces the deficit—in large part because of measures the law takes to responsibly slow the growth in Medicare and overall health spending. Lowering the projected growth of health care costs is a key promise of the law because these ever-escalating costs drain businesses, government coffers, and individuals’ savings. Yet many who criticize the law as a budget buster are aiming to repeal some of its key cost-containment features.
The Independent Payment Advisory Board is a case in point. The Affordable Care Act establishes this board to serve as a guarantor that the law’s cost-containment goals will actually be achieved. If the government’s main health care program for the elderly and disabled Medicare exceeds its per capita cost-growth targets under the new law, then the Independent Payment Advisory Board is empowered to recommend ways to reduce program expenditures by changing the way Medicare pays health care providers.
The secretary of health and human services must implement these recommendations unless Congress passes an alternative proposal or discontinues the cost-containment review process by the Independent Payment Advisory Board. Some legislators propose to eliminate the board. This would be a mistake.
Understanding the purpose of the board—as part of the Affordable Care Act’s cost-containment strategy overall—makes it clear that keeping and strengthening the independent board makes sense. The new health law’s cost-containment strategy includes both reducing excessive payments to providers under Medicare’s current payment mechanisms and moving Medicare—and, by example, the private sector—away from a payment system that rewards volume of services, without regard to health benefits, to payment arrangements that reward effective care, efficiently provided.
The Independent Payment Advisory Board will reinforce this twin focus on quality care at lower cost.
The Affordable Care Act holds hospitals and other institutional health care providers to productivity gains—something every other sector of our economy has achieved over the past several decades. Between 1995 and 2008 average annual productivity growth across the vast majority of U.S. businesses was 2.4 percentage points—just more than 1 percentage point higher than the previous two decades. In contrast, the health care, education, and social services sectors combined have produced average annual productivity growth rates of negative 0.2 percentage points.
The Affordable Care Act’s push for providers to produce productivity gains on par with other sectors promotes the efficiencies needed to reduce health care costs. But to assure that growth rates actually slow, the Affordable Care Act sets a target for Medicare spending growth and requires the Independent Payment Advisory Board to develop and recommend payment changes to achieve it. Both the Congressional Budget Office and the executive branch’s Centers for Medicare and Medicaid Services predict that explicit payment changes will produce most but not all of the savings needed to realize the independent board’s spending-growth targets through 2019 under the new law.
Avoiding excessive increases in the rates Medicare pays historically slows spending growth across the entire health care industry and can do so in the future. But tightening fee-for-service does nothing to improve quality or efficiency in care delivery—a critical goal of health reform. That’s why the Affordable Care Act includes multiple strategies to promote payment and delivery reform.
First, the new law stops rewarding bad behavior. The law authorizes the secretary of health and human services, without seeking congressional action, to review and alter “misvalued” fees, such as paying more for services than they’re worth, and to reduce payments for clearly undesirable behavior, such as hospital-acquired infections or conditions, inappropriate hospital readmissions, and, even more egregious, outright fraud. These new steps will deliver market-based signals to Medicare health care providers—and by example to the entire industry—that the wrong kinds of services that drive up current costs will no longer be rewarded.
Alongside what might be considered these “sticks” to change behavior come a set of essential “carrots,” or rewards to deliver more effective and efficient care. At the most basic level, these rewards are extra payments to providers for doing “good” things—say, meeting a set of efficiency standards while maintaining quality care. But more importantly, these rewards reside in alternative payment mechanisms to replace today’s fee-for-service payment system.
Among the new payment systems the new health law encourages is “bundling” separate fees into a single payment for services associated with a specific condition, such as a hip fracture, which today would include separate fees for diagnosis, surgery, and postoperative care. Another provision of the law promotes the financial and health benefits of primary care and chronic care management through newly created “medical homes,” which coordinate health care for their patients. And yet another new approach to health care promoted by the new law are so-called “accountable care organizations,” which are collaboratives of inpatient and outpatient providers who are rewarded for delivering quality care to a defined set of patients at lower-than-projected costs.
The new law sets a clear timetable for implementing some of these measures and creates the Center for Medicare and Medicaid Payment Innovation to initiate, evaluate, and broadly extend the application of these methods as part of “rapid cycle change.”
The law also recognizes that these efficiencies and the savings they can deliver will not be realized if changes in payment systems are limited to the public sector, and therefore encourages public-private partnerships. Medicare is a large payer, accounting for 20 percent of our nation’s medical bill in 2009. Private payers have historically followed Medicare payment practices. But that outcome is neither automatic nor immediate.
What’s more, inconsistent payment mechanisms across payers discourage providers from changing behavior, impede efficiency improvements, and create opportunities for offsetting one payer’s spending reductions with increases for others. Indeed, a recent study by the Medicare Payment Advisory Commission, an independent congressional agency, finds that hospitals squeezed by both Medicare and private payers changed their operations to become more efficient, yet hospitals with generous private payments ignored Medicare constraints, took losses on Medicare patients, and continued business as usual. Better quality care at lower costs requires that the public and private sectors work in tandem.
The health reform law encourages common action in different ways. The law gives preference to innovations where providers engage with private payers alongside Medicare in adopting new payment incentives Other provisions in the law further support payment reform in the private sector by extending access to Medicare provider performance data to guide private payers’ payment-reform efforts, and requiring private health plans to regularly report on those efforts. These data will inform the Independent Payment Review Board when it uses its authority to make nonbinding recommendations for private-payer reforms alongside binding recommendations for public programs.
This is a key provision of the new law. From 1970 to 2000 the private sector was less effective than Medicare in promoting efficiency, with an average annual growth rate per enrollee of 11.1 percent compared to Medicare’s rate of 9.6 percent. An effort that addresses public-sector but not private-sector health care spending risks limited access for beneficiaries as well as missed opportunities to encourage health care providers to operate more effectively and efficiently. Therefore, the broader the new board’s authority is to influence not only public but also private spending, the more effective it will be.
A focus on policy tools alone, however, obscures the most important element of the Independent Payment Review Board’s potential impact. Payment improvements in the past were stymied by legislators responding to providers’ resistance to change. Provider payment is rarely a partisan issue but it is a political issue. The new law takes the politics out of the equation by giving the independent board the authority to make Medicare payment recommendations that become law unless explicitly overridden by legislative action. This gives a major boost to policy over politics in containing health care costs.
And it’s precisely this boost that special interest groups want to prevent. Opponents of the new board complain it undermines congressional authority and removes from their control an important budgetary lever at a time when the federal budget deficit is rising at an unsustainable rate. But the real concern of many of these critics, who often are the fiercest advocates of fiscal restraint, is that the board’s authority diminishes their influence and their ability to fashion a Medicare budget that benefits the pharmaceutical industry and other special interest groups that are in a position to lose the most from the board’s future recommendations.
Other critics of the Independent Payment Advisory Board fear the Affordable Care Act did not go far enough in granting it authority, leaving too many loopholes for special interest groups to avoid payment adjustments. In making adjustments the board is prohibited from addressing payments to hospitals, skilled nursing facilities, and other health care providers who are scheduled to receive “productivity adjustments” under the Affordable Care Act. Rather than repeal the board, the more sensible option would be to close these loopholes and extend accountability for unacceptable health care cost increases.
In fact, members of Congress and policymakers in the federal government should be thinking of ways to strengthen the Independent Payment Advisory Board given the fiscal reality facing the federal government today. The new board is one of the Affordable Care Act’s most important cost-containment tools. We can’t afford to lose it.
By: Judy Feder, Senior Fellow, Center For American Progress, March 21, 2011