Rick Santelli is right (again)

Rick Santelli, CNBC

This morning I watched CNBC's Rick Santelli talking from the Chicago Board Of Trade.  His so-called, "Santelli Rant" has been watched on YouTube over a million times and his sentiments today, once again, represent the views of many Americans who pay their own way, just like you and me.  We believe in living within our means - it's how we were raised - but we lack a microphone.

Rick Santelli was in fine form this morning while debating Steve Liesman.  The topic was banking reform and Mr. Santelli made a case for an elegantly simple cure - raise the banks' capital requirements. 

Another CNBC commentator chimed in that this is the same risk premium banks require when a homeowner has a marginal credit history -- the bank looks for more cash in the deal -- a bigger down payment to compensate for the risk of default.

Why can't we use the same mechanism to minimize chances of another banking meltdown?  Do we need new federal agencies, reams of new regulations, congressional hearings, Barney Frank speeches and on and on? 

Banks just need greater reserves to cover their own risk-taking.  I realize such requirements affect profitability, but it beats more government involvement and added burden to the American taxpayer.

Medellín, Columbia and Nixon

I have heard from friends with ties to Columbia, that conditions have dramatically improved across the country, although impressions from an ugly past still linger around the world. 

Tonight during Anthony Bourdain's show about Columbia, I watch as he visits Medellín and interviews locals - many of whom suffered enormously during the awful Pablo Escobar period of the 1980s.  The people appear proud, hopeful, even happy.  Mr. Bourdain says something to a local that instantly reminds me of what a rueful Richard Nixon told the White House staff in the final hours of his presidency:

"Only if you have been in the deepest valley, can you ever know how magnificent it is to be on the highest mountain." 

He who frames the healthcare debate...wins.

When the topic of "healthcare reform" took center stage this summer, I thought I was the only one who felt that "healthcare reform" had suddenly become code for "let's-change-health-insurance." 

Yes, I was certain that I was missing something.  It's like the "3.5M jobs saved or created" metric which I wrote about last March.  I thought I was the only one disturbed by how stimulus programs would be measured, because I wasn't seeing or hearing any views similar to my own.  (Now I have plenty of company.)

Surgeons, Wikipedia

But back to the issue of healthcare reform - the only reform measure that counts is the one that lowers healthcare costs.  That should be how we frame the national discussion and measure success or failure. 

Lowering the cost of that pill, that doctor visit, that MRI, whatever it is - would benefit us all (except the stakeholders of the present system).  I do not see how the House bill will lower costs - just by virtue of universal coverage. 

Instead, it seems like it will perpetuate, expand and institutionalize the present cost structure.
Insurance policy premiums are a mirror of costs in our healthcare system, not a driver. 

When those costs go up, insurance premiums - it stands to reason - must also go up.  The uber sleight of hand here is that Team Obama, Ms. Pelosi, Mr. Reid, et al, have managed to shift the focus from lowering healthcare costs, to demonizing the entire healthcare insurance industry - which has as much control over healthcare costs, as a fish has to determine its water current.

They are also solving an accounts receivable problem for the healthcare industry with a feel good, social health policy.  If their bill ultimately passes, everyone will be covered including slow payers, partial payers and nonpayers.  And then we'll see more timely revenue streams to the healthcare system by virtue of a new, guaranteed (giant) payment mechanism. 

That new payment mechanism is government-mandated and taxpayer funded, healthcare reform - which of course is not reform at all - unless you frame the debate to look that way.