{"id":35917,"date":"2013-02-04T16:11:19","date_gmt":"2013-02-04T21:11:19","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=35917"},"modified":"2013-02-05T05:21:41","modified_gmt":"2013-02-05T10:21:41","slug":"revolving-zombies","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/02\/04\/revolving-zombies\/","title":{"rendered":"Revolving Zombies"},"content":{"rendered":"<p>On Friday, investors ignored the fact that the U.S. economy was in<br \/>\n&#8220;recession&#8221; at the end of last year. They said the fall in GDP in the<br \/>\nfourth quarter was a one-off fluke. The Dow went up 149 points.<\/p>\n<p>They weren&#8217;t bothered by the failure of the Fed&#8217;s &#8220;QE to Eternity&#8221;<br \/>\nplan either. It&#8217;s buying bonds to reduce interest rates. Instead,<br \/>\nthey&#8217;re going up. The 10-year note hit 2% on Friday.<\/p>\n<p>This is not a good time to be in stocks or bonds, in our opinion.<\/p>\n<p>But let&#8217;s move to another subject: revolving zombies.<\/p>\n<p>The defining characteristic of a zombified system is the way it hands<br \/>\nout its rewards. In an honest economy people do their best. They work<br \/>\nhard. They take their chances. Some prevail because they are productive.<br \/>\nOthers are just lucky. The chips fall where they may.<\/p>\n<p>But as zombies take over the system, the chips fall where they are<br \/>\ntold to fall. Rather than to honest and efficient producers, the rewards<br \/>\ngo to those who curry favors.<\/p>\n<h3 align=\"center\">The Strange Case of Elizabeth Fowler<\/h3>\n<p>Elizabeth Fowler knows how it works. She labored at the left hand of<br \/>\nSen. Max Baucus (D-Mont.), drafting the collection of crimes and<br \/>\npunishments that came to be known as &#8220;Obamacare.&#8221;<\/p>\n<p>Sen. Baucus admitted he had better things to do than read it. But he<br \/>\ndidn&#8217;t have to. His chief health policy counsel, the aforementioned Ms.<br \/>\nFowler, knew what was in it. As a former top lobbyist for Wellpoint,<br \/>\nAmerica&#8217;s largest health insurance provider, she had made sure the chips<br \/>\nfell where she wanted them to.<\/p>\n<p>&#8220;If you drew an organization chart of major players in the Senate <a title=\"To The Middle Class: Get Out Now!\" href=\"http:\/\/www.billbonnersdiary.com\/articles\/bonner-middle-class-escape.html\" target=\"_blank\"><strong>healthcare<\/strong><\/a> negotiations,&#8221; wrote Politico at the time, &#8220;Fowler would be chief operating officer.&#8221;<\/p>\n<p>Fowler had already been through the revolving door more than once or<br \/>\ntwice. She worked for Baucus before joining Wellpoint&#8230; and after. When<br \/>\nshe came back to Baucus she replaced Michelle Easton, another Wellpoint<br \/>\n<a title=\"The World's Biggest Scam\" href=\"http:\/\/www.billbonnersdiary.com\/articles\/bonner-middle-class-rut.html\" target=\"_blank\"><strong>lobbyist<\/strong><\/a>, who helped guide the senator on health policy while Ms. Fowler was on the Wellpoint payroll.<\/p>\n<p>After the legislation was passed, the White House turned to the<br \/>\nclever lobbyist to implement it. After all, the sweet spot in the<br \/>\nlegislation was the provision requiring people to buy products from<br \/>\ncompanies such as Wellpoint, whether they wanted to or not.<\/p>\n<p>As America&#8217;s new Special Assistant to the President for Healthcare<br \/>\nand Economic Policy at the National Economic Council, she had to make<br \/>\nsure Wellpoint got a good return on its investment.<\/p>\n<p>And then in December 2012: Whoosh&#8230; she went back through the<br \/>\nrevolving door. Type in &#8220;Elizabeth Fowler&#8221; and &#8220;revolving door&#8221; into<br \/>\nGoogle and you will get the whole story. The &#8220;architect of Obamacare,&#8221;<br \/>\nsay the papers, left the White House to go to the honeypot at Johnson<br \/>\n&amp; Johnson.<\/p>\n<p>What will she do there? Will she test the adult diapers? Will she<br \/>\ntake out the trash or write advertising jingles? No, she is up to her<br \/>\nold tricks \u2013 in a &#8220;senior position&#8221; at their &#8220;government affairs and<br \/>\npolicy group.&#8221;<\/p>\n<p>You go girl!<\/p>\n<p>(This is not the first time this sort of special privilege has been<br \/>\ngranted in the USA. The ethanol industry got it coming and going. Tax<br \/>\ncredits subsidized farmers for growing corn and then federal mandates<br \/>\nrequired fuel companies to buy it.)<\/p>\n<h3 align=\"center\">How the Zombie System Works<\/h3>\n<p>Wellpoint was not the only winner in the healthcare sector last year. <em>The New York Times<\/em> reports:<\/p>\n<p style=\"padding-left: 30px;\"><em>Just two weeks after pleading guilty in<br \/>\na major federal fraud case, Amgen, the world&#8217;s largest<br \/>\nbiotechnology firm, scored a largely unnoticed coup on Capitol Hill:<br \/>\nLawmakers inserted a paragraph into the &#8220;fiscal cliff&#8221; bill that did<br \/>\nnot mention the company by name but strongly favored one of its drugs.<\/em><\/p>\n<p>The special favor was buried in Section 632. It involved a kidney<br \/>\ndialysis drug, Sensipar, that was spared from cost-cutting restrictions<br \/>\nfor another two years. This was the fruit of efforts by 74 Amgen<br \/>\nlobbyists. It is expected to cost the Medicare system up to $500<br \/>\nmillion.<\/p>\n<p>That&#8217;s how a <a title=\"From Makers to Takers\" href=\"http:\/\/www.billbonnersdiary.com\/articles\/bonner-middle-class-industry-zombies.html\" target=\"_blank\"><strong>zombie<\/strong><\/a><br \/>\nsystem works. Congressional staff members slip favors to private sector<br \/>\ncompanies. Then the companies return the favors, giving staff members<br \/>\ncushy jobs.<\/p>\n<p>One of the chief Amgen lobbyists, for example, had been an employee<br \/>\nof Sen. Baucus, head of the Senate Finance Committee. Jeff Forbes was<br \/>\nthe senator&#8217;s chief of staff. Amgen has given the politicians $5 million<br \/>\nsince 2007&#8230; with $68,000 going to Baucus.<\/p>\n<p>But poor Elekta AB. The Swedish maker of radiation tools got stabbed<br \/>\nin the back by the same last-minute legislation. That&#8217;s the way<br \/>\nzombiedom works: The rewards go to people who are best able to pervert<br \/>\nthe political process.<\/p>\n<p>Elekta was at a disadvantage. A foreign company, it couldn&#8217;t give<br \/>\nmoney to the politicians. Varian, its competitor, could. Plus, Varian<br \/>\nput 18 lobbyists on the case and managed to get Elekta&#8217;s payments cut in<br \/>\nhalf.<\/p>\n<p>More to come&#8230;<\/p>\n<p>Regards,<\/p>\n<p><img decoding=\"async\" title=\"Bill Bonner\" alt=\"Bill Bonner\" src=\"https:\/\/www.insidersstrategygroup.com\/images\/web\/bbonner-sig.gif\" \/><\/p>\n<p>Bill<\/p>\n<p><span><a href=\"http:\/\/www.billbonnersdiary.com\/\" target=\"_blank\">http:\/\/www.billbonnersdiary.<wbr \/>com\/<\/a><\/span><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>On Friday, investors ignored the fact that the U.S. economy was in &#8220;recession&#8221; at the end of last year. They said the fall in GDP in the fourth quarter was a one-off fluke. The Dow went up 149 points. They weren&#8217;t bothered by the failure of the Fed&#8217;s &#8220;QE to Eternity&#8221; plan either. It&#8217;s buying &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/www.investmacro.com\/forex-news\/2013\/02\/04\/revolving-zombies\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Revolving Zombies&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-35917","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/35917","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=35917"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/35917\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=35917"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=35917"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=35917"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}