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By Tom Demerly.

trojanhorse

In much the same way as Franklin Roosevelt is remembered for the Social Security Act of 1935, President Barack Obama will be remembered for the Affordable Care Act.

And it may be a larger success than any of us imagine.

The Affordable Care Act could be a masterfully engineered piece of legislation that has already set in motion the only means possible to topple big medicine and make U.S. health care affordable. But not how you think.

We’ve all seen the charts and YouTubes comparing the cost of medical procedures in the U.S. to other countries. They make a case for health care being significantly more expensive in the U.S. than in other countries that already have a state subsidized or administered medical system.  It’s possible the authors of the ACA did a masterful “Potomac two-step” in selling the ACA to the powerful medical, pharmaceutical and hospital lobby. Washington sold them a Trojan horse.

ACA critics have pointed to a host of administrative problems that are likely short lived. Those problems aren’t “structural”.

A structural problem built into ACA is that the weight of medical costs in the U.S. is spread over the broader economic “ice” of the American population. That ice is still too thin to support big medicine’s current financial weight. One of two things can happen: The ice can break or some weight can be removed.

Since ACA is law, and law can presumably be enforced, the “ice” that is ACA will be held up by Washington. The weight that comes off the ACA ice will be U.S. “Big Medicine” getting whittled down to functional size. No more massive, glossy prescription drug marketing campaigns. No more mini-malls and valet parking at hospitals. No more health care providers filing endless reams of electronic files, paying staff to interpret billing and insurance logistics and creating their own internal television networks to promote themselves. Malpractice litigation will be reformed. Medicine will become more medical, less commercial and litigious.

The ACA will dry up hospital "malls" and commercial dining areas and other accessories to hospital operation.

The ACA will dry up hospital “malls” and commercial dining area and other accessories to hospital operation.

There will be blood. Hospital staff, already strained in many places, will be trimmed. Logistics will be streamlined, even doctors will earn less. Health care suppliers will suffer mightily; with many going bankrupt like auto component suppliers did in the U.S. automotive bailout. And just like the automotive bailout many of the financial negotiations that were abrasive and costly between unions and car companies will now be quickly dispensed in bankruptcy court. And for once, it will be the medical companies that will take the hit. The ACA may protect the citizen-patient.

“Health care quality will contract while health care access will expand.”

If this is the direction of ACA, intended or not, the process will be an abrasive one. We the people in the first decade of ACA will experience constant changes in health care logistics and a general decline in the quality of health care. In short, our health care infrastructure will contract to a scale similar to those of countries with functioning social medicine. In many ways that will appear as a downgrade. But in the spirit of ACA it will spread access to health care across a broader population. Instead of high-income people getting great health care and middle and lower class people getting none or reduced levels with exposure to financial ruin, everyone will get a roughly equivalent level of healthcare services and products. Health care quality will contract while health care access will expand. The optimal balance will be when the two conflicting agendas meet in the middle.

It’s possible President Obama’s ACA will be remembered as the savior of the American patient, not the American medical industry. Getting there will require a long and painful period of financial and legislative surgery that includes some painful amputations with no anaesthetic.

By Tom Demerly.

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Contrary to popular belief, rich people don’t cause other people to be poor. That’s a feeble excuse for our national condition.

There is a sentiment that the distribution of wealth in the United States, as inequitable as it is, comes from the wealthy “keeping the little man down”.  To horde disproportionate amounts of wealth- taking it from the backs of Walmart workers.

That’s wrong.  We’re not victims, we’re Americans. “The Man” isn’t keeping us down. That’s just an excuse. It’s us who let us down, and I am a perfect example.

I started and owned a successful business for over 16 years. Then lost everything. I lost my savings, my house, my car, my belongings, my income, my employees, my business, even my health… everything. There were circumstances that contributed to my loss. But ultimately I am the one responsible. Part of the proof is that two friends of mine in the same area and the same industry survived the recession. They survived because they made better decisions than me. They are better businessmen than me.

I am a reason why America failed during this last decade. There are a lot of “me” out there.

There is a reason to own this. Until we own the recession, the mortgage crisis, the banking collapse- unless we own these disasters, on an individual basis, we cannot correct them. We won’t truly recover.

The first step to correcting any problem is owning it. Taking responsibility for it. We need to take a painful and specific look at where we made bad decisions individually that led to our financial hardship. Once we understand how we got here, on an individual basis, we can get out, on an individual basis. America is built on the backs of individuals, and it fell on the backs of individuals who let it down. Guys like me.

Dearborn, Michigan, 2009 on Michigan Ave.

Abandoned businesses, downtown Dearborn, Michigan in 2009 on Michigan Ave.

What did I do wrong? Too much credit, not enough saving. Poor planning. Relying on the fact that money was easy to make and would always be easy to make. Becoming complacent, assuming business would always be good. Trusting the wrong institutions and people. Not saving enough for a rainy day. Beginning to think that earning a living was easy and success was common. Ignoring the basics. Never planning for a downturn in business. Those are some of the general mistakes I made. When you apply those mistakes to a huge company like General Motors before their bankruptcy, the banks before their collapse and the real estate market you see how these behaviors rippled from the individual through our entire culture. It was a house of cards. When the wind finally blew it didn’t need to blow very hard for it to topple.

So what now?

First, we need to own the problem on an individual basis. Look at how we failed. Individually, collectively. Then, with that knowledge, return to the basics of saving and building, working and taking risk, thinking and innovating. Our economic system, as chaotic as it seems, rewards risk and hard work with opulent success and penalizes failure with ruthless disregard and gut-wrenching impunity. It also rewards us with a second chance. It isn’t easy, in fact it is extremely difficult. My life these past few years has been more difficult than I care to share. It’s humiliating. Our system does work though. It provides a level of opportunity, however abrasive and difficult to achieve, that is nearly unmatched in the world. This is the greatest country, the land of opportunity, but it is also a ruthless arbiter.

It demands we own our past before we can earn our future. But our system also forgives.

In my case that meant a lot of tough years. Now I am certain I’ll never make these mistakes again. I’m thankful for a country that allows me to start again with what I’ve learned, no matter how difficult it is. That is the American way.