Book reviews – Faking It: The Sentimentalisation of Modern Society

Posted on December 21, 1998 by urbanrenaissanceinst

Robert Sibley
The Next City
December 21, 1998

Edited by Digby Anderson and Peter Mullen (The Social Affairs Unit, 1998. 217 pages) $35

YOU MIGHT REMEMBER THE SCENE LAST SEPTEMBER 6TH ON THE STREET outside Westminster Abbey where thousands had gathered for the funeral of Diana, Princess of Wales. An American television reporter, her voice choking with emotion, repeatedly referred to the “parade” that would soon take Diana’s body into the cathedral.

Eventually, the reporter twigged to her mistake and turned the “parade” into a “procession.” Perhaps, though, her choice of words wasn’t inappropriate. Perhaps she was unconsciously expressing some new zeitgeist. Perhaps in the age of entertainment, funerals have become carnivals.

You might come to such a conclusion after reading Faking It: The Sentimentalization of Modern Society, which skewers many of western liberal civilization’s cherished shibboleths. The editors, Digby Anderson and Peter Mullen of The Social Affairs Unit, a London-based conservative think tank, encapsulate the book’s theme this way: “There is a word for the decadent disposition in our culture which falls for the fake: it is ‘sentimentality.’ The sentimentalist is a person in denial, and what he avoids or denies is reality. He likes to think that good ends can be achieved without unpleasantness. He would rather not be reminded that pain, effort, personal responsibility, self-control and patience are inevitable. He is attracted by schemes which offer good ends without the need for any striving — learning, a just society, community and even pleasure. Most of all the sentimentalist is frightened by the idea that men have a natural capacity for evil. For to admit evil, and the will to evil, is to destroy his world which rests upon the supposition that utopia may be ushered in by the mere adoption of the right plan.”

Building on this foundation, Faking It‘s 12 essays depict a flaccid and phony society in which self-indulgence, fakery, and a “voracious appetite for sentimentality” shape politics, religion, art, and even our eating habits. (Most of the essays focus on British society, but readers will have no difficulty finding Canadian parallels.) One contributor castigates our fondness for therapeutic relief and feel-good counselling as a refusal to grow up; another describes the psychologists who indulge us as “peddlers of utopia.” And yet another portrays alternative medicine as catering to immature people unable to accept medical realities with fortitude. According to these writers, radical environmentalism reflects the false assumption that nature is benign and that the manmade world is alienating. Contemporary literature and music represent, in the main, emotional fakery.

Trendy religious practices come in for a particularly scathing critique. Peter Mullen, an Anglican cleric, writes that our sentimental society is reducing mainstream Christianity to a clap-happy form of wish fulfilment that seeks to evade the realities of life and death. “The new sentimentality in religion glosses over our dark side, and therefore it is not only a doctrinal failure; it is psychologically inaccurate and so finally incoherent.”

Nicholas Capaldi, an American academic, argues that sentimentality has eroded the values and coherence of middle-class virtues, resulting, in less than 20 years, in “a dependent underclass — the drug-addicted, the violent, the unemployed and the promiscuous.” Moreover, as Capaldi writes, “The lifestyle of this underclass is sentimentalised — as poverty once was — as real life. The word disadvantaged is used to identify the underclass with the stultifying badge of dependency. This has now reached the extreme limit in which we even sentimentalise crime and so abolish the moral distinction between right and wrong. No one is to blame for anything, except wicked capitalists and conservatives.”

However, the most devastating essay in the book — and the one that created the most controversy in Britain — is “Diana, Queen of Hearts” by Anthony O’Hear, a professor at Bradford University. The Princess’s funeral, the extreme grief shown at her death, and her subsequent idolization betray a fake society that has shifted away from traditional standards of conduct. “Diana’s personal canonization, for it amounts to no less, was at the same time a canonization of what she stood for. What she stood for was the elevation of feeling, image and spontaneity over reason, reality and restraint. The Britain of our fathers and grandfathers, the Britain of World War II has been replaced by the New Britain in which the mother of the future King publicly weeps at the funeral of a vulgar and self-publicizing Italian dress designer.”

This surrender of the traditional civic virtues of reason, reality, and restraint is, finally, what most concerns the book’s contributors. Diana’s story is the story of many. We have become a society obsessed with selfhood, self-expression, self-actualization. We think that self-fulfilment — the satisfaction of our own desires — forms our ultimate and perhaps only responsibility. As O’Hear writes, “In the Diana story, duty is a notion which is entirely absent.”

At the personal level, this results in psychological and even spiritual distortions, which reveal themselves in self-destructive behavior, such as Diana’s bulimia. At the public level, this self-obsession wrecks the institutions — education, religion, politics, and medicine — on which society depends for stability and order.

The chapter on education, “Sweetness and light in schools,” by academics Bruce Cooper and Dennis O’Keeffe soundly supports this argument. “In recent decades, education has set aside discipline and obedience and replaced them with false love and slackness,” the authors assert. “Sentimentalists romanticise children, ostensibly proclaiming the natural goodness of children, but in fact pandering to human idleness.”

Cooper and O’Keeffe conclude that sentimental teachers — really ideologically blinkered social engineers — strive to erase competition and intellectual distinction, so everyone can be a winner and maintain his self-esteem. But promoting self-esteem at the expense of genuine education is a delusion: Students who leave school unable to read, write, and think properly will have little self-respect and no way to gain any when they find themselves unemployed. Put simply, the sentimental educator fails to see the difference between self-esteem and self-delusion.

Health food fanatics also suffer from self-delusion, argues Digby Anderson in another essay. Instead of realistically seeing food and drink as a source of nourishment and pleasure, they view it as a threat to their longevity, a harbinger of obesity, or even a conspiracy by the food industry to give them heart disease.

SOME OF THE BOOK‘S ARGUMENTS GO TOO FAR IN THEIR POLEMICAL ATTACK on all things modern. Undoubtedly, much of alternative medicine borders on quackery, and stoicism is a lost virtue. But surely, not all of the interest in healthy eating — vitamin supplements, a balanced diet, and suspicion of a food industry that pumps drugs into livestock — can or should be dismissed as “a form of wishful thinking.”

The chapter attacking environmentalists’ concerns also requires skepticism. Technology has unquestionably improved the lot of the human race; no parent with a sick child ever objected to penicillin. Yet we should not dismiss worries about technology’s direction. Apocalyptic environmentalism may reflect a kind of irrational neo-paganism, but it is not irrational to worry about the indiscriminate use of pesticides and the spread of industrial contaminants.

Nonetheless, these essays ring true: Western society is increasingly sentimental. Instead of viewing life as a mystery to be met with courage and joy, too many view it as a problem to be solved by some ultimate utopia. Perhaps, as T. S. Eliot once wrote, “Human kind cannot bear very much reality.” But Faking It‘s contributors offer a fearsome analysis of false-fronted institutions and of a society whose members are willing to believe in anything because, fundamentally, they believe in nothing beyond themselves. Thus, this book serves as a salutary warning for the new century.

If this book has a damning problem — besides offending most of the unquestioned assumptions of a self-absorbed populace — it is in obtaining it. While Canadian newspapers have reported the controversy that greeted the book in Britain, so far no Canadian distributor has obtained rights for this country.

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Homelessness – Speech

Posted on December 3, 1998 by urbanrenaissanceinst

Lawrence Solomon
Fair Rental Association Annual General Meeting
December 3, 1998

We hear a lot these days about homelessness being a national disaster. What we don’t hear is that homelessness is a new phenomenon, the term was not even in common parlance until the 1980s.

We don’t hear that homelessness first came to the public’s attention during the big spending 1970s, before the recessions of the 1980s and the hard-hearted era of cutbacks in the 1990s.

Homelessness is a disaster, but it’s one of our own making. And it was brought to us by governments with only the best of intentions.

In the 1960s and 1970s, urban renewal became the vogue. Urban renewal meant clearing slums. Thanks to urban renewal, vast supplies of low-quality housing disappeared.

Newark and New York City lost almost half of their low-rent housing between 1970 and 1990; The Bowery had 10,000 beds in 1965, but 3,000 in 1980. In the 1970s and 1980s, Chicago lost 20 per cent of its low-rent housing; of the 10,000 spaces in the Loop area’s cubicle hotels, 600 remained. In Toronto, we lost virtually all of our 500 flophouse beds by the early 1980s. By the end of the decade, we had lost one-third of our rooming houses.

That was only the beginning. Legislation of various kinds was passed, all designed to help the poor, but it backfired on the poor.

Rent control is one example, and not just because it discouraged new construction. Rent control was designed to keep rents low in a time of housing shortage, and that it did. But the effect of having a surplus of apartment seekers was to let landlords pick and choose who they would rent to.

Landlords, naturally, picked stable tenants over potentially dicey ones. The down and out had no chance in this new competition for scarce space.

Tenant right legislation also backfired on the poor. This legislation prevented landlords from evicting the prostitutes, drug dealers, and rowdy tenants who caused good tenants to leave.

So landlords stopped renting to anyone with the potential to be troublesome. Again, the poor were the first to suffer.

With all this low-rent housing demolished, and so much of the balance reserved for respectable tenants, the poorest of the poor had no place to go but the streets. Ironically, they were newly freed up through the repeal of vagrancy laws.

The way out of homelessness begins by backing out along the same path that created it. We must restore vagrancy laws. We must require housing for those unable to properly look after themselves. Welfare must provide the down-and-out with housing vouchers that can be used anywhere, not just in shelters, but in exchange for a couch in a relative’s living room. That’s how many poor people, including alcoholics and the mentally ill, used to live. They doubled up with relatives or sublet rooms in exchange for cash or household services, typically babysitting for women, odd jobs for men.

The last thing the homeless need is anonymous public housing.

To encourage friends and relatives to take the homeless in and other landlords to re-enter the business, we must throw out rules preventing easy evictions of tenants, even publicly funded hostels and shelters routinely evict or refuse to admit disorderly occupants. This accountability will prod some of today’s homeless to get along with those around them, as their counterparts once did.

The government must re-regulate the use of public spaces, and deregulate the housing market to let the homeless find inexpensive housing niches for themselves. The largest sources of appropriate housing, ones that many municipalities wrongly ban, are basement apartments and other occupancies in residential districts.

Doing so will give homeless people what they need most, to be engaged in society. Above all, we must force the homeless to engage the rest of us.

Posted in Housing | Leave a comment

Editorial – The end of corruption

Posted on December 1, 1998 by urbanrenaissanceinst

Lawrence Solomon
The Next City
December 1, 1998

 

Without corruption, poor countries, would not be poor, not even those ravaged by years of warfare. The Asian Development Bank reports that corruption can cost governments as much as half of their tax revenue and can amount to more than a country’s total foreign debt. The World Bank estimates that corruption increases the cost of public projects by as much as 30 per cent. London’s Centre for Accountability and Debt Relief estimates that government corruption accounts for 5 to 7 per cent of government expenditures in advanced economies and for 15 to 25 per cent, and sometimes more, in poor countries. For the poor countries, this amounts to some $600 billion per year — about 10 times as much as they receive in foreign aid from all the world’s foreign aid agencies combined.

Big though these sums are, most costs of corruption don’t show up in studies, which merely tend to count the amounts pocketed. Because megaprojects and the big contracts that accompany them are efficient vehicles for siphoning graft into politicians’ pockets, unneeded public works will be ordered, not because the country needs a remote dam or a four-lane highway through a rainforest, but because the politicians in charge can then claim their cut. The bigger the project, the bigger the cut.

While corruption leads the state to waste billions in white elephants, it also prevents billions in legitimate investments from entering a country. Singapore’s Business Times warned its readers recently to be wary of developing land in China, despite the large profits in convincing a local official to rezone low-value agricultural land for, say, apartment buildings: “The flip side of this easy adjustment is that the change often lasts only as long as the person who changed it stays on the job. If the person is removed, the land could suddenly revert back to its original use — regardless of how much investment had been put into it.”

Some costs of corruption can’t be quantified. Because so many in the Third World have lost faith in the criminal justice system, vigilantism has become rampant. To stop petty thievery by the thousands of youths and homeless children who wander Sao Paolo’s streets, vigilantes murdered 202 street children during the first three months of 1993. In Nairobi, mobs lynched more than 100 crime suspects in 1994.

Despite its depravity, until recently corruption has had lofty supporters. In the late 1970s, Columbia University’s Nathaniel Leff argued that “corruption may introduce an element of competition into what is otherwise a comfortably monopolistic industry . . . payment of the highest bribes [introduces] . . . a tendency toward efficiency.” A 1985 article in the Journal of Political Economy asserted that “bribing strategies . . . minimize the average value of the time costs of the queue.” While economists developed elaborate models showing corruption’s conduciveness to development, other academics — pointing to the Asian Tigers’ economic success — deemed corruption “cultural,” and not to be judged by inappropriate western standards.

This academic environment helped legitimize bribery in the minds of corporate and government leaders. Prime Minister Jean Chrétien, when a trade minister in the 1980s, urged Canadians not to put their “head in the sand” and pass up overseas sales when our Crown corporation, Atomic Energy of Canada Ltd., became embroiled in shady dealings. In response to an investigation by Canada’s Auditor General into $18 million in payments to clinch the sale of reactors to South Korea and Argentina, the Canadian government stated that a Canadian could not only legally bribe a foreign official, but also deduct bribes as an expense, provided the briber obtained a receipt. “Commercial practices in other countries sometimes are different from ours,” Chrétien explained. “I am not about to condemn the morals of anybody. It would be very presumptuous for Canadians to tell other people how to conduct their morals.” Other countries, including Germany and France, also viewed bribes as legitimate business expenses. When the United States, which banned bribery in 1977, proposed a universal ban by UN treaty, it was widely mocked for misguided moralism.

The academics should have come down from their ivory towers to view the world as it is. Far from greasing the bureaucratic wheels to speed development, corruption puts a spanner in the works: Officials often create regulations solely to receive bribes. In India, one high-level civil servant, unable to speed an approval given the multiple bureaucracies involved, solicited bribes to slow approvals required by rival companies.

Corruption impedes not just multinationals but also the most modest of enterprises. To demonstrate the hurdles involved in establishing a typical small business — a simple garment factory — Peru’s Institute for Liberty and Democracy rented the premises of an existing factory on the outskirts of Lima, installed sewing machines and other equipment, and recruited four university students to comply with the bureaucracy. Although an administrative lawyer guided them, the students handled all the red tape themselves, going from government office to government office, filing form after form, as would a person of humble origin.

To comply with the law took 289 days and 11 permits. Along the way, bureaucrats asked for 10 bribes; 8 were avoided, but two had to be paid. The entire procedure cost $1,231, or 32 times the minimum monthly living wage. In a different study, buying an urban lot and building a house took 83 months of red tape. In yet another, establishing an outdoor market took 14 and a half years. Corruption, the institute discovered, excludes ordinary people from the economy, restricting access to those skilled in politicking and red tape, and impoverishing the nation.

Fortunately, apologists for corruption are no longer in vogue. The United Nations, in its 1991 Human Development Report, acknowledges the destructive process in which “Citizens use political influence to get access to government services. Politicians ensure that government resources are directed toward their supporters. And public officials exploit their official positions for personal reward.” Where once they looked the other way, the World Bank, the International Monetary Fund, and other international organizations now seek to curb corrupt practices. The OECD’s Convention on Combating Bribery of Foreign Public Officials, signed in 1997 and now being ratified by the legislatures of 34 nations, will criminalize bribery of foreign legislative, administrative, and judicial officials, whether appointed or elected, and of officials of government-controlled corporations and international organizations.

Much of the pressure to clean up corruption comes from U.S. corporations who, according to the U.S. Commerce Department, lost 100 foreign contracts worth $45 billion in 1994 and 1995 to overseas rivals providing bribes. But businesses everywhere dislike this degrading, time-consuming activity. A survey of Russia and the Ukraine found that owners and senior managers of high-bribing firms spent an inordinate 30 to 40 per cent of their time with government officials to overcome myriad regulations, licences, and taxes. Based on a survey of 2,000 companies in 49 countries, businesses that operate in highly regulated settings routinely confront outstretched hands: in fact, the more regulatory discretion, the likelier the need to bribe officials. Corruption hits business’s bottom line: Investing in a relatively corrupt country, a recent economic study shows, amounts to an additional 20 per cent tax on the investment.

But mostly, the worldwide push against corruption comes from an increasingly intolerant global citizenry. In Asia, Indonesian President Suharto fell following protests against his refusal to undertake reforms, especially regarding his family’s ill-gotten billions from state-connected enterprises. Corruption charges ousted Prime Ministers Narasimha Rao of India and Benazir Bhutto of Pakistan, and jailed former South Korean presidents Roh Tae-woo and Chun Doo-hwan. In Japan, numerous top-level government and business leaders have resigned in the wake of corruption scandals, as has a Politburo member in China. In Latin America, bribery charges led to the impeachment of Presidents Fernando Collor de Mello of Brazil and Carlos Andres Perez of Venezuela and to the resignation of Ecuador’s President Abdala Bucaram. In Europe, corruption overthrew Italy’s entire leadership of more than four decades, defeated Spain’s Prime Minister Felipe Gonzales, and forced the resignation of NATO Secretary General Willy Claes and Czech Prime Minister Vaclav Klaus.

People are corruptible, in the West as in the Third World. The U.S.’s Koreagate scandal of 1976-78 involved dozens of congressmen who had taken money or gifts from agents of the South Korean government. In the Abscam scandal of 1978-80, FBI agents posing as Arab sheiks found numerous public officials willing to accept money for help with immigration authorities; six representatives and one senator were convicted of bribery. In the Wedtech scandal of 1986-89, payoffs by a military contractor led to dozens of convictions, including of two representatives on charges of racketeering, tax evasion, bribery, fraud, grand larceny, and perjury.

People in low places are also corruptible. Last fall, Montreal suspended 74 Green Onions — one-third of its entire parking police force — along with 10 managers after a parking ticket scam came to light. Under the system, which had existed in different forms for decades, Green Onions had distributed more than 500 tiny VIP stickers to themselves, to relatives, and to city employees, including an estimated 180 police officers. Those with stickers on their licence plates didn’t get tickets.

CORRUPTION INVOLVES STEALING FROM THE PEOPLE, GENERALLY FROM the public purse or from a public institution that has a relationship of trust with the public. Unlike the theft of one man’s possessions by another, corruption involves the theft of the public weal by a public official.

Corruption cannot exist in an open system, where no official enjoys any discretion over a decision. Corrupt officials need regulations, protectionism, state monopolies, and state ownership — without these tools, they cannot ply their trade. Corruption also cannot exist in a free market. Third World corruption-greased projects — say, hydroelectric dams — cost 25 per cent too much. Without a monopoly, a company can’t force its customers to pay 25 per cent more for its power. They will buy power from plants free of the corruption surcharge. Only the state can enforce this ability to coerce consumers.

Lord Acton’s famous dictum from the previous century — “Power tends to corrupt and absolute power corrupts absolutely” — brilliantly reduces the power-corruption relationship to its essentials. But the dictum also works in reverse. The less power held, the less there tends to be corruption. Lord Acton was talking generally — not just of absolute monarchs but also of the Catholic Church prior to the Reformation, when corrupt clerics cravenly sold dispensations. The data from modern times bear him out.

As Harvard Business School economists Alberto Ades and Rafael Di Tella discovered after analyzing data from many countries, trade openness and product competition reduce corruption; liberalizing an economy by minimizing regulations and maintaining moderate, simple tax regimes with little discretion further reduces corruption.

While many justifiably fear that privatization of state enterprises will unfairly enrich politicians’ friends — all too often, state corruption has had this very outcome — failing to privatize only worsens the situation. Studies show completed privatizations have been less corrupt than other transactions; the underground economy of most countries that delayed privatization, meanwhile, thrived in comparison. Corruption ends once enterprises operate in a free environment.

As deregulation and globalization force governments to become smaller and smaller, as their commercial operations become privatized, and as industrial monopolies break up and become subject to competition, government power will devolve to the people. Needless regulations will disappear, eliminating most corruption and increasingly isolating its remaining strongholds. The OECD’s anti-bribery convention points us to the most significant of these: While politicians have agreed to ban the bribery that occurs in much of government, they insisted on exemptions to protect their own political institutions. It will remain legal to bribe foreign political parties, party officials, and candidates.

Posted in Culture, Regulation | Leave a comment

Here’s Your Allowance, Dear

Posted on October 1, 1998 by Other News Sources

Michael Fitz-James
Canadian Healthcare Manager
October 1, 1998

Healthcare allowances for all Canadians: Are they the long-awaited financial solution to our healthcare troubles, or just a really ‘dumb idea’?

Should Canada be using a “healthcare allowance” (HCA) system which supposedly “empowers” consumers by giving them greater control over how their health dollars are spent? Although the idea has many detractors, it is being taken seriously by some in the insurance sector, and has received a lot of play in the media recently.

An allowance system, it’s argued, gives consumers an “incentive” to use health resources less wastefully and also gives greater access to services not currently covered by public plans.

The chief proponent of the proposal, the Toronto-based Consumer Policy Institute, argues that an HCA-based system could control costs at their current levels, and perhaps even drive them down slightly.

Here’s how it works: The federal and/or provincial government would create a system which covers both “catastrophic” insurance coverage (for serious health problems) and an annual “allowance” for more routine healthcare matters. This allowance would be a theoretical amount and would vary according to age, gender and health status.

The government would provide each individual with a healthcare allowance “account,” which would be owned jointly by the individual and the government.

Allowance dollars would be deposited into this account and could only be spent on approved healthcare services, the cost of which would be fixed by the government. If consumers spend more than their allowance on routine care, they’d have to pay any extra from their own pocket, but only up to a certain “threshold.”

After that, the government would cover 100% of the extra cost. Any spend above the threshold would be considered part of catastrophic insurance.

If there was money remaining at year’s end, half would be returned to the government and half would remain in the account and would belong to the consumer.

That excess, which would earn interest and be free of income tax, could be applied against account overspending in future years, or to health services not covered by the plan, like dental care, drugs, chiropractic services or psychoanalysis.

If the unspent surplus in the account grew to exceed an individual’s anticipated medical needs, it could be rolled over to a retirement savings plan (RSP) and be used to supplement income in later years. The money would be taxable once removed from the RSP.

As a practical example, take a 30-year-old healthy male who could be allocated a total annual insurance threshold of $520, calculated on the average use of the healthcare system by all similar individuals. Of that amount $416 would be included in the consumer’s HCA account and $104 would be allocated to the consumer.

Assuming the individual spent nothing on health care over the year, the HCA account would have a balance of $416 at year’s end. A modest $200 spend would leave a balance of $216.

However, if our consumer spends $450, he’d be expected to pay the extra $34 himself and the balance left in the account would be zero. A spend of $l,000 in the year, would mean a claim of $480 over the $520 threshold. $416 would come from the HCA account and $104 from the consumer (for a total of $520). The extra $480 would be paid by the Medicare plan.

For a 75-year old female, the threshold could be much higher – say $3,700 – of which $3,330 would be deposited to her HCA account. A maximum of $370 (or 10%) would be borne by the consumer if any overspending occurred, and any claim over and above that, would be paid by medicare.

“The basic concept underlying the Health Care Allowance is that getting people involved in spending dollars for their own health care will dramatically change the way people use discretionary services,” says an actuarial report prepared for the Consumer Policy Institute by the U.S.-based healthcare consultants, Milliman & Robertson.

However, the report says, “little if any change is anticipated for high cost services that relate to serious conditions. The proposed system’s financial objective is to remain cost-neutral compared to current provincial health plan expenditures.”

“The arithmetic doesn’t work”

An HCA system, says the report, would also reduce system fraud because consumers would be paying for their health services themselves. Additional tax revenue would be generated for governments once accrued principal and interest in the accounts was converted to retirement income.

Basically, says Lawrence Solomon, director of the Consumer Policy Institute, the HCA system “creates a market in the healthcare sector. The funds can’t leave the sector, but there is still a market within it.

“On average, our actuarial studies show, in three out of four years people will have money left over in their accounts, so they can put money aside for other purposes.”

Since more consumers will start using the healthcare system less wastefully, Solomon believes healthcare providers will want to maintain their incomes by being more proactive in offering preventative services.

“Physicians would become diligent in reminding women they’re due for a Pap smear or men when it’s time to screen for prostrate cancer,” he says.

And consumers will have an incentive to use such services because if they don’t use their allowance during the year, it will revert to the government “It’s use it or lose it,” says Solomon.

Both rich and poor would be empowered under an HCA system because both would be given the same number of healthcare dollars and could spend them at their discretion.

And consumers would directly see the economic impact their healthcare spending choices have. For example, consumers would see that an emergency room visit costs much more than a trip to the family doctor, so such inappropriate hospital use would be discouraged.

And since some of the non-covered services could be paid for from account surpluses, employer health benefits plans (which now cover these costs) could be cheaper, and the savings passed on to employees as salary.

Mark Litow, a consulting actuary with Milliman & Robertson in Brookfield, Wis., says the idea for HCAs springs from the new concept of “medical savings accounts,” which are starting to be used in the U.S. and have been around for some time in South Africa and Singapore.

In the U.S., the idea parallels an RRSP, where contributions are made to create a fund against future healthcare spending. Sometimes they’re rolled into employee benefit plans, and the U.S Internal Revenue Service has apparently created some limited tax treatment provisions to encourage them, say Litow,

Still. Noralou Roos, co-director of the Manitoba Centre for Health Policy and Evaluation in Winnipeg, says she doesn’t think the idea, “imported from the U.S.,” will have much use here, although the insurance industry is apparently taking it seriously.

“In the Canadian context. I think it really doesn’t make sense,” she says. The idea’s premised on the notion that consumers use health services wastefully and that by their choices they can use it less wastefully.

“I’d ask for evidence for that assertion,” says Roos. “We’ve tried to look at the factors which predict why people go to the physician. We come up with indicators that suggest that those who are unhealthy go to the doctor and those who are healthy don’t.”

“There’s evidence that physician practice style – how many times the physician suggests the patient come back for a re-visit – is a big driver of utilization and has as much influence as any patient-driven factors.”

Michael Mendelson, senior scholar with Caledon Institute of Social Policy in Ottawa is even tougher on the HCA concept. At a conference last May at the McMaster Centre for Health Policy Research, there was a tough debate over HCAs, and Mendelson concludes they are a “dumb idea.”

Mendelson, a former deputy minister of health in several provincial governments, now formulates health policy, and believes HCAs are being touted as “a new panacea – there’s one that sweeps through the U.S. every few years”

In Canada, however, “it’s a very fringe idea because it’s totally unclear what problem this is meant to solve, and it’s totally clear it will create many other problems of a major sort- You’d have a hard time finding any reputable health economist who would endorse this idea,”

The HCA system, says Mendelson, “assumes much of the expensive use is a consequence of consumer demand” and while such demand does drive initial visits to a physician or emergency room, that cost is “less than 10 percent” of the total system.

Creating an incentive is the same, in economic terms, as charging a user fee and, says Mendelson, “study after -study” has shown that user fees don’t, lower utilization – in fact “perversely,” it usually goes up.

“There’s no reason in logic or in evidence to assume that a user charge will reduce inappropriate utilization any more that it will reduce appropriate utilization.”

What’s more, he says, “the arithmetic doesn’t work – the amount of premium you’d have to pay, assuming zero administrative cost – would be more than, or equal to, your average costs. And as for administrative costs, this would cost a bloody fortune to administer.”

And Mendelson sees other problems: “You’re sick and your wife has cancer, so you use up your entire medical savings account. But Joe Blow next, door doesn’t have cancer, and retires with an extra $100,000 for being in good health. Is this the idea of the Canadian system?

“Does it seem fair that we should have taxpayers paying subsidies to people who aren’t sick? Is this a reasonable redistribution of income – from the sick to the healthy?”

Plus the “one payer” (i.e. the provincial government) in the current system has the power to control health care costs, something that would be lost if each individual paid their own healthcare bills.

“And what’s the purpose of this? It’s not like our system’s out of control. Why give up on one of the world’s best systems for some fly-by-night stupid idea – something coming out of the U.S. that’s not relevant to our situation at all?”

Posted in Regulation | Leave a comment

What would happen if traffic calming ruled our streets?

Posted on September 21, 1998 by urbanrenaissanceinst

Mike Skene and Jim Sproul
The Next City
September 21, 1998

The Next City Asked Mike Skene, transportation manager for the City of Victoria, and Jim Sproul, neighborhood activist, to comment

Neighborhood roads would be safer. Traffic calming — which includes getting the community involved in decision making, employing landscaping and esthetics to influence driver behavior, and designing roads to be self-enforcing and self-explaining to drivers — decreases accidents, reducing vehicle insurance premiums, medical insurance, and lawyers fees. The Insurance Corporation of British Columbia agrees that neighborhoods with traffic calming had fewer accidents. When accidents and other mishaps do occur, traffic-calmed neighborhoods are more accessible to emergency vehicles than neighborhoods that use road closures and one-way streets to combat traffic problems.

Neighborhoods would be more secure. Many large American cities find that traffic calming combats criminals. Slow get-away speeds through neighborhoods deter drug dealing, prostitution, drive-by shootings, and home invasions.

Outdoor social activity would increase. Traffic calming supports neighborhood watch programs, creates respect for the community, and is more conducive to walking and cycling as an alternative to driving.

Property values would increase, not only bringing pride to the neighborhood but also serving as a catalyst to economic regeneration — a significant benefit in downtown core neighborhoods.

Long-term costs would be reduced. Although traffic calming has high initial and ongoing maintenance costs, economic regeneration, increased tax revenues from higher valued properties, and less wear and tear on neighborhood roads translate into lower long-run costs. By creating neighborhood pride, traffic calming also encourages residents to maintain boulevards, sweep gutters, and pick up leaves, balancing any short-term increase in maintenance costs.

City politicians would meddle constantly in our neighborhoods. Local politicians, looking for visible projects that might leapfrog them into higher office, are already modifying the very nature of our lives by installing various traffic-calming devices — including traffic circles, speed bumps, curb extensions, and concrete barriers — often without the citizens’ knowledge or consent. A year and a half ago, the vast majority of residents in my North Toronto neighborhood were shocked to find that the city had put four concrete barriers at each intersection (84 in total). After a series of residents meetings, the city agreed to a vote on the barriers, and over 72 per cent of the residents wanted them removed immediately. While some communities may want traffic calming, my neighborhood’s experience shows that grandstanding politicians shouldn’t plow ahead without their constituents’ approval.

Streets would become ugly, reducing property values. The barriers in my neighborhood came in a variety of shapes and sizes, but most were 4-feet-high and 6-feet-long concrete monstrosities that caused home prices to plummet, on an average of 10 to 15 per cent.

Streets would become unsafe. The barriers in my neighborhood resulted in narrow roadways — especially dangerous in wet and snowy weather — that increased accidents by 50 per cent. Also, children played on the barriers, dangerously close to traffic.

Cities would waste their money. Not only is traffic calming expensive (the city spent $450,000 in my community), it often fails to reduce traffic. In my neighborhood, residents create 90 per cent of the traffic. Instead of discouraging what was in reality non-existent outside traffic, the expensive barriers simply made driving more difficult for residents.

City politicians would meddle constantly in our neighborhoods. Local politicians, looking for visible projects that might leapfrog them into higher office, are already modifying the very nature of our lives by installing various traffic-calming devices — including traffic circles, speed bumps, curb extensions, and concrete barriers — often without the citizens’ knowledge or consent. A year and a half ago, the vast majority of residents in my North Toronto neighborhood were shocked to find that the city had put four concrete barriers at each intersection (84 in total). After a series of residents meetings, the city agreed to a vote on the barriers, and over 72 per cent of the residents wanted them removed immediately. While some communities may want traffic calming, my neighborhood’s experience shows that grandstanding politicians shouldn’t plow ahead without their constituents’ approval.

Streets would become ugly, reducing property values. The barriers in my neighborhood came in a variety of shapes and sizes, but most were 4-feet-high and 6-feet-long concrete monstrosities that caused home prices to plummet, on an average of 10 to 15 per cent.

Streets would become unsafe. The barriers in my neighborhood resulted in narrow roadways — especially dangerous in wet and snowy weather — that increased accidents by 50 per cent. Also, children played on the barriers, dangerously close to traffic.

Cities would waste their money. Not only is traffic calming expensive (the city spent $450,000 in my community), it often fails to reduce traffic. In my neighborhood, residents create 90 per cent of the traffic. Instead of discouraging what was in reality non-existent outside traffic, the expensive barriers simply made driving more difficult for residents.

Jim Sproul

Mike Skene

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