( Commondreams.org ) – The United States health care system—more costly than any on earth—will become ever more so as Wall Street increasingly extracts money from it.

Private equity funds own approximately 9% of all private hospitals and 30% of all proprietary for-profit hospitals, including 34% that serve rural populations. They’ve also bought up nursing homes and doctors’ practices and are investing more year by year. The net impact? Medical costs to the government and to patients have gone up while patients have suffered more adverse medical results, according to two current studies.

The Journal of the American Medical Association (JAMA) recently published a paper which found:

Private equity acquisition was associated with increased hospital-acquired adverse events, including falls and central line–associated bloodstream infections, along with a larger but less statistically precise increase in surgical site infections.

This should not come as a surprise. Private equity firms in general operate as follows: They raise funds from investors to purchase enterprises using as much borrowed money as possible. That debt does not fall on the private equity firm or its investors, however. Instead, all of it is placed on the books of the purchased entity. If a private equity firm borrows money and buys up a nursing home or hospital chain, the debt goes on the books of these healthcare facilities in what is called a leveraged buyout.

To service the debt, the enterprise’s management, directed by their private equity ownership, must reduce costs, and increase its cash flow. The first and easiest way to reduce costs is by reducing the number of staff and by decreasing services. Of course, the quality of care then suffers. Meanwhile, the private equity firm charges the company fees in order to secure its own profits.

With so much taxpayer money sloshing around in the system, hedge funds also are cashing in.

An even larger study of private equity and health was completed this summer and published in the British Medical Journal (BMJ). After reviewing 1,778 studies it concluded that after private equity firms purchased healthcare facilities, health outcomes deteriorated, costs to patients or payers increased, and overall quality declined.

Photo by Towfiqu barbhuiya on Unsplash

One former executive at a private equity firm that owns an assisted-living facility near Boulder, Colorado, candidly described why the firm was refusing to hire and retain high-quality caregivers: “Their position was: We are trying to increase our profitability. Care is an ancillary part of the conversation.”

Medicare Advantage Creates Wall Street Advantages

Congress passed the Medicare Advantage program in 2003. Its proponents claimed it would encourage competition and greater efficiency in the provision of health insurance for seniors. At the time, privatization was all the rage as the Democratic and Republican parties competed to please Wall Street donors. It was argued that Medicare, which was actually much more efficient than private insurance companies, needed the iron fist of profit-making to improve its services. These new private plans were permitted to compete with Medicare Part C (Medigap) supplemental insurance.

In 2007, 19% of Medicare recipients enrolled in Medicare Advantage plans. By 2023 enrollment had risen to 51%. These heavily marketed plans are attractive because many don’t charge additional monthly premiums, and they often include dental, vision, and hearing coverage, which Medicare does not. And in some plans, other perks get thrown in, like gym memberships and preloaded over-the-counter debit cards for use in pharmacies for health items.

How is it possible for Medical Advantage to do all this and still make a profit?

According to a report by the Physicians for a National Health Program, it’s very simple—they overcharge the government, that is we, the taxpayers, “by a minimum of $88 billion per year.” The report says it could be as much as $140 billion.

In addition to inflating their bills to the government, these HMO plans don’t pay doctors outside of their networks, deny or slow needed coverage to patients, and delay legitimate payments. As Dr. Kenneth Williams, CEO of Alliance HealthCare, said of Medicare Advantage plans, “They don’t want to reimburse for anything — deny, deny, deny. They are taking over Medicare and they are taking advantage of elderly patients.”

Enter Hedge Funds

With so much taxpayer money sloshing around in the system, hedge funds also are cashing in. They have bought large quantities of stock in the healthcare companies that are milking the government through their Medicare Advantage programs. They then insist that these healthcare companies initiate stock buybacks, inflating the price of their stock and the financial return to the hedge funds. Stock buybacks are a simple way to transfer corporate money to the largest stock-sellers.

(A stock buyback is when a corporation repurchases its own stock. The stock price invariably goes up because the company’s earnings are spread over a smaller number of shares. Until they were deregulated in 1982, stock buybacks were essentially outlawed because they were considered a form of stock price manipulation.)

United Healthcare, for example, is the largest player in the Medicare Advantage market, accounting for 29% of all enrollments in 2023. It also has handsomely rewarded its hedge fund stock-sellers to the tune of $45 billion in stock buybacks since 2007, with a third of that coming since March 2020. Cigna, another big Medicare Advantage player, just announced a $10 billion stock buyback.

These repurchases are also extremely lucrative for United Healthcare’s top executives, who receive most of their compensation through stock incentives. CEO Andrew Witty, for example, hauled in $20.9 million in 2022 compensation, of which $16.4 million came from stock and stock option awards.

Those of us fighting for Medicare for All have much in common with every worker who is losing his or her job as a result of leveraged buyouts and stock buybacks.

A look at the pharmaceutical industry shows where all this is heading. Between 2012 and 2021, fourteen of the largest publicly traded pharmaceutical companies spent $747 billion on stock buybacks and dividends, more than the $660 billion they spent on research and development, according to a report by economists William Lazonick and Öner Tulum. Little wonder that drug prices are astronomically high in the U.S.

And so, the gravy train is loaded and rolling, delivering our tax dollars via Medicare Advantage reimbursements to companies like United Healthcare and Big Pharma, which pass it on to Wall Street private equity firms and hedge funds.

It’s Not Just Healthcare

In researching my book, Wall Street’s War on Workers, we found that private equity firms and hedge funds are undermining the working class through leveraged buyouts and stock buybacks. When private equity moves in, mass layoffs (just like healthcare staff cuts and shortages) almost always follow so that the companies can service their debt and private equity can extract profits. When hedge funds insist on stock repurchases, mass layoffs are used to free up cash in order to buy back their shares. As a result, between 1996 and today, we estimate that more than 30 million workers have gone through mass layoffs.

Meanwhile, stock buybacks have metastasized throughout the economy. In 1982, before deregulation, only about 2% of all corporate profits went to stock buybacks. Today, it is nearly 70%.

Those of us fighting for Medicare for All, therefore, have much in common with every worker who is losing his or her job as a result of leveraged buyouts and stock buybacks. Every fight to stop a mass layoff is a fight against the same Wall Street forces that are attacking Medicare and trying to privatize it. Creating a sane healthcare system, therefore, will depend on building a massive common movement to free our economy from Wall Street’s wealth extraction.

To take the wind out of Medicare Advantage and Wall Street’s rapacious sail through our healthcare system, we don’t need more studies. It’s time to outlaw leveraged buyouts and stock buybacks.

( ProPublica) – Ever since he was a medical student, Dr. Neil Martinson has confronted the horrors of tuberculosis, the world’s oldest and deadliest pandemic. For more than 30 years, patients have streamed into the South African clinics where he has worked — migrant workers, malnourished children and pregnant women with HIV — coughing up blood. Some were so emaciated, he could see their ribs. They’d breathed in the contagious bacteria from a cough on a crowded bus or in the homes of loved ones who didn’t know they had TB. Once infected, their best option was to spend months swallowing pills that often carried terrible side effects. Many died.

So, when Martinson joined a call in April 2018, he was anxious for the verdict about a tuberculosis vaccine he’d helped test on hundreds of people.

The results blew him away: The shot prevented over half of those infected from getting sick; it was the biggest TB vaccine breakthrough in a century. He hung up, excited, and waited for the next step, a trial that would determine whether the shot was safe and effective enough to sell.

Weeks passed. Then months.

More than five years after the call, he’s still waiting, because the company that owns the vaccine decided to prioritize far more lucrative business.

Pharmaceutical giant GSK pulled back on its global public health work and leaned into serving the world’s most-profitable market, the United States, which CEO Emma Walmsley recently called its “top priority.” As the London-based company turned away from its vaccine for TB, a disease that kills 1.6 million mostly poor people each year, it went all in on a vaccine against shingles, a viral infection that comes with a painful rash. It afflicts mostly older people who, in the U.S., are largely covered by government insurance.

Importantly, the shingles vaccine shared a key ingredient with the TB shot, a component that enhanced the effectiveness of both but was in limited supply.

From a business standpoint, GSK’s decision made sense. Shingrix would become what the company calls a “crown jewel,” raking in more than $14 billion since 2018.

But the ability of a corporation to allow a potentially lifesaving vaccine to languish lays bare the distressing reality of public health vaccine creation. With limited resources, governments have long seen no other option but to team with Big Pharma to develop vaccines for global scourges. But after the governments pump taxpayer money and resources into the efforts, the companies get control of the products, locking up ownership and prioritizing their own gain.

That’s what GSK did with the TB vaccine. Decades ago, the U.S. Army brought in GSK to work on a malaria vaccine and helped develop the ingredient that would prove game-changing for the company. It was an adjuvant, a substance that primed the body’s immune system to successfully respond to a vaccine for malaria — and, the company would come to learn, a variety of other ailments.

GSK patented the adjuvant and took control of the supply of the ingredients in it. It accepted government and nonprofit funding to develop a TB vaccine using the adjuvant. But even though it isn’t carrying the vaccine to the finish line, it isn’t letting go of it entirely either, keeping a tight grip on that valuable ingredient.

As TB continued to rage around the globe, it took nearly two years for GSK to finalize an agreement with the nonprofit Bill & Melinda Gates Medical Research Institute, or Gates MRI, to continue to develop the vaccine. While the Gates organization agreed to pay to keep up the research, GSK reserved the right to sell the shot in wealthy countries.

The trial that will determine whether the vaccine is approved won’t begin until 2024, and isn’t expected to end until at least 2028. “We just can’t operate like that for a disease that is this urgent,” said Thomas Scriba, a South African scientist and TB expert who also worked on the study.

GSK pushes back against the premise that the company delayed the development of the TB vaccine and says it remains dedicated to researching diseases that plague underserved communities. “Any suggestion that our commitment to continued investment in global health has reduced, is fundamentally untrue,” Dr. Thomas Breuer, the company’s chief global health officer, wrote in a statement.

The company told ProPublica that it cannot do everything, and it now sees its role in global health as doing early development of products and then handing off the final clinical trials and manufacturing to others. It also said that a vaccine for TB is radically different from the company’s other vaccines because it can’t be sold at scale in wealthy countries.

Though a good TB vaccine would be used by tens of millions of people, it has, in the parlance of industry, “no market,” because those who buy it are mostly nonprofits and countries that can’t afford to spend much. It’s not that a TB vaccine couldn’t be profitable. It’s that it would never be as profitable as a product like the shingles vaccine that can be sold in the U.S. or Western Europe.

Experts say the story of GSK’s TB vaccine, and its roller coaster of hope and disappointment, highlights a broken system, which has for too long prioritized the needs of corporations over those of the sick and poor.

“We don’t ask for a fair deal from our pharma partners,” said Mike Frick, a director of the tuberculosis program at Treatment Action Group and a global expert on the TB vaccine pipeline. “We let them set the terms, but we don’t ask them to pick up the check. And I just find it frankly a little humiliating.”

Steven Reed, a co-inventor of the TB vaccine, brought his idea to GSK decades ago, believing that working with a pharmaceutical giant was essential to getting the shots to people who desperately needed them. He’s disillusioned that this hasn’t happened and now says that Big Pharma is not the path to saving lives with vaccines in much of the world. “You get a big company to take it forward? Bullshit,” he said. “That model is gone. It’s failed. It’s dead. We have to create a new one.”

Gaining Control

In the early 1980s, the U.S. Army was desperate for a way to keep troops safe from the parasite that causes malaria. Military scientists had some promising ideas but wanted to find a company that could help them develop and manufacture the antigen, the piece of a vaccine that triggers an immune response. They called on SmithKline Beckman, now part of GSK, which had a plant outside of Philadelphia committed to the exact type of antigen technology they were researching.

For the company’s part, working with the Army gave it access to new science and, importantly, the ability to conduct specialized research. The Army had laboratories for animal testing and ran clinical trial sites around the world. It’s also generally easier to get experimental products through regulatory approval when working with the government, and Army scientists were willing to be infected with malaria and run the first tests of the vaccine on themselves.

Col. Carl Alving, then an investigator at the Walter Reed Army Institute of Research, said he was the first person known to be injected with an ingredient called MPL, an adjuvant added to the vaccine. Today, we know that adjuvants are key to many modern vaccines. But at the time, only one adjuvant, alum, had ever been approved for use. Alving published promising results, showing that MPL boosted the shot’s success in the body.

Company scientists took note and began adding MPL to other ingredients. If one adjuvant was good, maybe two adjuvants together, stimulating different parts of the immune system, might be even better.

Image by Arek Socha from Pixabay

It was an exciting development, bringing the multiple adjuvants together, Alving said in an interview. But then he learned that the company scientists had filed a patent for the combinations in Europe, which put limits on what he and his colleagues could do with MPL. “The Army felt perhaps a little frustrated by that because we had introduced Glaxo to the field.”

Still, the Army wanted the malaria vaccine. Military personnel started comparing the adjuvant combinations on rhesus monkeys at an Army facility in Thailand and ran clinical trials that tested the most promising pairs in humans and devised dosing strategies.

The Army found that one of the combinations came out on top: MPL and an extract from the bark of a tree that grows in Chile. The bark extract was already used in veterinary vaccines, but a scientist at one of the world’s first biotech companies had recently discovered you could purify it into a material that makes it safe enough for use in humans.

Alving said that at the time, he didn’t patent the work he and his colleagues were doing or demand an exclusive license for MPL. “It’s a question of the Army being the Army, which is not a company,” Alving said. (This was actually the second time the government failed to secure its rights over MPL. Decades earlier, the ingredient was discovered and formulated by scientists working for the Department of Veterans Affairs and a National Institutes of Health lab in Montana. One of the scientists, frustrated that his bosses in Bethesda, Maryland, wouldn’t let him test the product in humans, quit and formed a company, taking the research with him. Though his company initially said it thought MPL was in the public domain and couldn’t be patented, he did manage to patent it.)

Experts say drug development in the U.S. is littered with such missed opportunities, which allow private companies to seize control of and profit off work done by publicly funded researchers. Governments, they say, need to be more aggressive about keeping such work in the public domain. Alving has since done just that, recently receiving his 30th patent owned by the military.

It’s an open secret in the pharmaceutical world that companies participate in global health research because it’s where they get to try out new technologies that can be applied to other, more lucrative diseases.

At an investor presentation in 2016, a GSK executive used the malaria vaccine example to explain the benefit of such work. “Of those of you who think this is just philanthropy, it is not,” Luc Debruyne, then president of vaccines at GSK, told the group. He explained that it was through the malaria work that the company invented the adjuvant that is now in its blockbuster shingles vaccine. And, he explained, vaccines are high-volume products that make a steady stream of money over time. “So doing good business, innovating and doing well for the world absolutely can get married.”

As the Army’s research on the combination of MPL and the bark extract evolved — and its market potential became clear — GSK moved to vacuum up the companies that owned the building blocks to the adjuvant.

In 2005, it bought the company that owned the rights to MPL for $300 million. In 2012, it struck a deal for the rights to a lion’s share of the supply of the Chilean tree bark extract.

The company was now in full control of the adjuvant.

Picking a Winner

GSK eagerly began to test its new adjuvant on a number of diseases — hepatitis, Lyme, HIV, influenza.

Steven Reed, a microbiologist and immunologist, had come to the company in 1994 with an idea for a tuberculosis vaccine. An estimated 2 billion people are infected with TB globally, but it’s mainly those with weakened immune systems who fall ill. A century-old vaccine called BCG protects young children, but immunity wanes over time, and that vaccine does little to shield people from the most common type of infection in the lungs.

Reed had just the background and resources to attempt a breakthrough: An adjunct professor at Cornell University’s medical school, he also ran a nonprofit research organization that worked on infectious diseases and had co-founded a biotech company to create and market products.

He and his colleagues were building a library of the proteins that make up the mycobacterium that causes TB. He also had access to a blood bank in Brazil, where TB was more prevalent, that he could screen the proteins against to determine which generated an immune response that prevented people from getting sick.

At the time Reed pitched the vaccine, the company’s decision over whether to take him up was made by researchers, said Michel De Wilde, a former vice president of research and development at the company that partnered with Reed and later became part of GSK. Today, across the industry, finance units play a much stronger role in deciding what a company works on, he said.

GSK signed on, asking Reed to add the company’s promising new adjuvant to his idea for a TB vaccine.

Reed and his colleagues used more than $2 million in federal money to conduct trials from 1995 to 2005. GSK also invested, but NIH money and resources were the key, Reed said. As the vaccine progressed into testing, the Bill & Melinda Gates Foundation pitched in, as did the governments of the United Kingdom, the Netherlands and Australia, among others.

Amid all that, in 2003, GSK started testing the adjuvant in its shingles vaccine, according to annual reports, but at a much faster speed. With TB, it performed a small proof-of-concept study to justify moving to a larger one. There’s no evidence it did so with shingles. By 2010, GSK’s shingles vaccine was in final trials; in 2017, the FDA approved it for use.

To employees and industry insiders, GSK was making its priorities clear. The company built a vaccine research facility in Rockville, Maryland, to be closer to the NIH and the Food and Drug Administration; at the same time, it was retreating from TB and other global public health projects, according to former employees of the vaccine division.

All the while, the adjuvant was limited. GSK struggled to ramp up production of MPL, according to former employees there; it relies on a cumbersome manufacturing process. And it wasn’t clear whether there was sufficient supply of the Chilean tree that is essential to both vaccines.

After researchers learned of the TB vaccine’s successful proof-of-concept results in 2018, GSK said nothing about what was next.

“You would have thought people would have said: ‘Oh shit, this is doable. Let’s double down, let’s quadruple down,’” said Dr. Tom Evans, former president and CEO of Aeras, a nonprofit that led and paid for half of the proof-of-concept study. “But that didn’t happen.”

Scriba, who was involved in the study in South Africa, said he never imagined that GSK wouldn’t continue the research. “To be honest it never occurred to us that they wouldn’t. The people we worked with at GSK were the TB team. They were passionate about TB,” Scriba said. “It’s extremely frustrating.”

But Reed said that when the shingles vaccine was approved, he had a gut feeling that GSK would abandon the tuberculosis work.

“The company that dropped it used similar technology to make billions of dollars on shingles, which doesn’t kill anyone,” Reed said.

Those in the field grew so concerned about the fate of the TB vaccine that the World Health Organization convened a series of meetings in 2019.

Breuer, then chief medical officer for GSK’s vaccine division, explained that the pharmaceutical giant was willing to hand off the vaccine to an organization or company that would cover the cost of future development, licensing, manufacturing and liability. If the next trial went well, they could sell the vaccine in the “developing world,” with GSK retaining the sales rights in wealthier countries.

GSK would, however, retain control of the adjuvant, Breuer said. And the company only had enough for its other vaccines, so whoever took over the TB vaccine’s development would need to pay GSK to ramp up production, which Breuer estimated would cost around $200 million.

Dr. Julio Croda was director of communicable diseases for Brazil at the time and attended the meeting. He said he was authorized to spend significant government funds on a tuberculosis vaccine trial but needed assurances that GSK would transfer technology and intellectual property if governments paid for its development. “But in the end of the meeting, we didn’t have an agreement,” he said.

Dr. Glenda Gray, a leading HIV vaccine expert who attended the meeting on behalf of South Africa, said she wasn’t able to get a straight answer about the availability of the adjuvant.

The year after the WHO meeting, after what a Gates representative described as “a lot of negotiation,” GSK licensed the vaccine to Gates MRI, a nonprofit created by the Gates Foundation to develop drugs and vaccines for global health issues that for-profit companies won’t tackle.

GSK told ProPublica that it did not receive upfront fees or royalties as part of the arrangement, but that Gates MRI paid it a small incentive to invest in the company’s global health endeavors. GSK and Gates MRI declined to comment on the amount.

Gates MRI tax documents show a payment designated as “royalties, license fees, and similar amounts that allow the organization to use intellectual property such as patents and copyrights” the year the agreement was finalized. Among available tax documents, that is the only year the organization has made a payment in that category.

The amount: $10 million.

An Uncertain Future

In June of this year, the Gates Foundation and the Wellcome Trust announced they were pledging $550 million to fund the phase 3 trial that will finally show whether the vaccine works. They’ve selected trial locations and are currently testing it on a smaller subset of patients, those with HIV.

Jeremy Farrar, chief scientist at the WHO, said he’s more optimistic than he’s ever been in his career that we’ll have a new TB vaccine this decade.

Gates MRI and GSK declined to say who had the rights to sell the vaccine in which countries, but Gates MRI said it will “work with partners to ensure the vaccine is accessible for people living in high TB-burden lower- and middle-income countries,” and GSK acknowledged that its rights extend to South America and Eastern Europe, two regions with significant pockets of TB.

As expected, Gates MRI will be reliant on GSK to supply the adjuvant, which concerns vaccine hopefuls because of the lack of transparency surrounding its availability. One of the key ingredients, the bark extract, comes from a tree whose harvest and export has been controlled by the Chilean government since the 1970s because of overexploitation. A megadrought and forest fires continue to threaten native forests today. The main exporter of the bark says it has resolved previous bottlenecks, and GSK said it is working on a synthetic version as part of its long-term plan.

In response to questions about why it retained control of the adjuvant, GSK said it was complicated to make, would not be economical to produce in more than one place, and was a very important component in many of the company’s vaccines, so it wasn’t willing to share the know-how.

The adjuvant is only growing in value to the company, as it adds yet another lucrative vaccine to its portfolio that requires it. In May, the FDA approved a GSK vaccine for the respiratory virus known as RSV. Analysts project that the shot will bring in $4 billion annually at its peak. GSK continues to study the adjuvant in additional vaccines.

GSK strongly insists that it has enough of the adjuvant to fulfill its forecasted needs for the RSV, shingles, malaria and TB vaccines through 2035.

The company and Gates MRI said their agreement includes enough adjuvant for research and the initial supply of the TB vaccine, if it is approved. The organizations declined, however, to specify how many people could be vaccinated. GSK also said it was willing to supply more adjuvant after that, but further negotiations would be necessary and Gates MRI would likely need to pay to increase adjuvant manufacturing capacity. For its part, Gates MRI said it is evaluating several strategies to ensure longer term supply.

Several experts said that Gates MRI should test other adjuvants with the vaccine’s antigen. That includes Farrar, who said it would be “very wise” to start looking for a new adjuvant. He is one of the few people who has seen the agreement between Gates MRI and GSK as a result of his previous role as director of the Wellcome Trust. Farrar is now helping to lead a new TB Vaccine Accelerator Council at the WHO and said he believes one of the group’s roles would be to find solutions to any future problems with the adjuvant.

Gates MRI declined to answer when asked if it was considering testing other adjuvants with the vaccine’s antigen. GSK, along with several other scientists and regulators that ProPublica spoke with, expressed that using a new adjuvant would require redoing all of the long and expensive clinical trials.

U.S. government officials, meanwhile, are working to identify adjuvants that aren’t already tied up by major pharmaceutical companies.

For a corporation, the primary concern is “what is this adjuvant doing for my bottom line,” said Wolfgang Leitner, who began his career working at Walter Reed Army Institute of Research on the malaria vaccine as a consultant for GSK. Now the chief of the innate immunity section at the National Institute of Allergy and Infectious Diseases, his job is to encourage the development of new adjuvants and to make sure that researchers have access to ones that aren’t tightly controlled by individual companies.

The WHO has also been helping to build a global network of vaccine manufacturers who can develop and supply vaccines to less wealthy countries outside of the shadow of Big Pharma; it is using a technology debuted during the COVID-19 pandemic called mRNA, which deploys snippets of genetic code to trigger an immune response. Reed, an inventor of GSK’s TB vaccine, co-founded the company at the center of that effort, Afrigen, after growing concerned about the fate of the vaccine he made for GSK.

Reed helped create a second TB vaccine, which Afrigen has the rights to manufacture for sale in Africa. But that vaccine has yet to start a proof-of-concept trial.

Over the past five years, an average of just $120 million a year has been spent on all TB vaccine research globally, including money from governments, pharmaceutical companies and philanthropic organizations, according to annual surveys conducted by the Treatment Action Group. For perspective, the U.S. alone spent more than $2 billion developing COVID-19 vaccines from 2020 to 2022. At a special UN meeting on tuberculosis in 2018, the nations of the world pledged to ensure $3 billion was spent on TB vaccine research and development over the next five years. Just 20% of that was handed out.

While that mRNA hub holds promise, it will be years before an mRNA TB vaccine enters a proof-of-concept trial, according to people involved. The pharmaceutical companies that made successful COVID-19 vaccines have refused to share the technology and manufacturing techniques that make mRNA vaccines work. One company, Moderna, has said it won’t enforce its patents on mRNA vaccines Afrigen creates for COVID-19, but it’s not clear what it’ll do if Afrigen applies those techniques to a disease like TB. (Paul Sagan, board chairman of ProPublica, is a member of Moderna’s board.)

To date, the GSK tuberculosis vaccine — which does not use mRNA technology — is the only one that meets a set of characteristics the WHO believes are necessary for a viable TB vaccine.

The phase 3 trial is set to begin early next year. In the time between the two trials, approximately 9 million people will have died from TB.

ProPublica

Medicare Advantage is just another example of the endless greed of the insurance industry poisoning American healthcare,” says a new report from Physicians for a National Health Program.

Jake Johnson

( Commondreams.org ) – A report published Wednesday estimates that privately run, government-funded Medicare Advantage plans are overcharging U.S. taxpayers by up to $140 billion per year, a sum that could be used to completely eliminate Medicare Part B premiums or fully fund Medicare’s prescription drug program.

Physicians for a National Health Program (PNHP), an advocacy group that supports transitioning to a single-payer health insurance system, found that Medicare Advantage (MA) overbills the federal government by at least $88 billion per year, based on 2022 spending.

That lower-end estimate accounts for common MA practices such as upcoding, whereby diagnoses are piled onto a patient’s risk assessment to make them appear sicker than they actually are, resulting in a larger payment from the federal government.

But when accounting for induced utilization—”the idea that people with supplemental coverage are likely to use more health care because their insurance pays for more of their cost”—PNHP estimated that the annual overbilling total could be as high as $140 billion.

“This is unconscionable, unsustainable, and in our current healthcare system, unremarkable,” says the new report. “Medicare Advantage is just another example of the endless greed of the insurance industry poisoning American healthcare, siphoning money from vulnerable patients while delaying and denying necessary and often lifesaving treatment.”

Even if the more conservative figure is accurate, PNHP noted, the excess funding that MA plans are receiving each year would be more than enough to expand traditional Medicare to cover dental, hearing, and vision. Traditional Medicare does not currently cover those benefits, which often leads patients to seek out supplemental coverage—or switch to an MA plan.

The Congressional Budget Office has estimated that adding dental, vision, and hearing to Medicare and Medicaid would cost just under $84 billion in the most costly year of the expansion.

“While there is obvious reason to fix these issues in MA and to expand traditional Medicare for the sake of all beneficiaries,” the new report states, “the deep structural problems with our healthcare system will only be fixed when we achieve improved Medicare for All.”

Bolstered by taxpayer subsidies, Medicare Advantage has seen explosive growth since its creation in 2003 even as it has come under fire for fraud, denying necessary care, and other abuses. Today, nearly 32 million people are enrolled in MA plans—more than half of all eligible Medicare beneficiaries.

Earlier this year, the Biden administration took steps to crack down on MA overbilling, prompting howls of protest and a furious lobbying campaign by the industry’s major players, including UnitedHealth Group and Humana. Relenting to industry pressure, the Biden administration ultimately agreed to phase in its rule changes over a three-year period.

Leading MA providers have also faced backlash from lawmakers for handing their top executives massive pay packages while cutting corners on patient care and fighting reforms aimed at rooting out overbilling.

As PNHP’s new report explains, MA plans are paid by the federal government as if “their enrollees have the same health needs and require the same levels of spending as their traditional Medicare counterparts,” even though people who enroll in MA plans tend to be healthier—and thus have less expensive medical needs.

“There are several factors that potentially contribute to this phenomenon,” PNHP’s report notes. “Patients who are sicker and thus have more complicated care needs may be turned off by limited networks, the use of prior authorizations, and other care denial strategies in MA plans. By contrast, healthier patients may feel less concerned about restrictions on care and more attracted to common features of MA plans like $0 premiums and additional benefits (e.g. dental and vision coverage, gym memberships, etc.). Insurers can also use strategies such as targeted advertising to reach the patients most favorable to their profit margins.”

A KFF investigation published last month found that television ads for Medicare Advantage “comprised more than 85% of all airings for the open enrollment period for 2023.”

“TV ads for Medicare Advantage often showed images of a government-issued Medicare card or urged viewers to call a ‘Medicare’ hotline other than the official 1-800-Medicare hotline,” KFF noted, a practice that has previously drawn scrutiny from the U.S. Senate and federal regulators.

PNHP’s report comes days after Cigna, a major MA provider, agreed to pay $172 million to settle allegations that it submitted false patient diagnosis data to the federal government in an attempt to receive a larger payment.

Image by OsloMetX from Pixabay

Dr. Ed Weisbart, PNHP’s national board secretary, toldThe Lever on Wednesday that such overpayments are “going directly into the profit lines of the Medicare Advantage companies without any additional health value.”

“If seniors understood that the $165 coming out of their monthly Social Security checks was going essentially dollar for dollar into profiteering of Medicare Advantage, they would and should be angry about that,” said Weisbart. “We think that we pay premiums to fund Medicare. The only reason we have to do that is because we’re letting Medicare Advantage take that money from us.”

But with corporations insistent on squeezing more profits no matter the cost, strikes are inevitable — and necessary.

Sonali Kolhatkar

Sonali Kolhatkar is the host of “Rising Up With Sonali,” a television and radio show on Free Speech TV and Pacifica stations. This commentary was produced by the Economy for All project at the Independent Media Institute and adapted for syndication by OtherWords.org.

Otherwords.org

(The Conversation) – When she took to the floor to give her State of the Union speech on 13 September, European Commission president Ursula von der Leyen largely stood by the script. Describing her vision of an economically buoyant and sustainable Europe in the era of climate change, she called on the EU to accelerate the development of the clean-tech sector, “from wind to steel, from batteries to electric vehicles”. “When it comes to the European Green Deal, we stick to our growth strategy,” von der Leyen said.

Her plans were hardly idiosyncratic. The notion of green growth – the idea that environmental goals can be aligned with continued economic growth – is still the common economic orthodoxy for major institutions like the World Bank and the Organisation for Economic Co-operation and Development (OECD).

The OECD has promised to “strengthen their efforts to pursue green growth strategies […], acknowledging that green and growth can go hand-in-hand”, while the World Bank has called for “inclusive green growth” where “greening growth is necessary, efficient, and affordable”. Meanwhile, the EU has framed green growth as

“a basis to sustain employment levels and secure the resources needed to increase public welfare […] transforming production and consumption in ways that reconcile increasing GDP with environmental limits”.

However, a survey of nearly 800 climate policy researchers from around the world reveals widespread scepticism toward the concept in high-income countries, amid mounting literature arguing that the principle may neither be viable nor desirable. Instead, alternative post-growth paradigms including “degrowth” and “agrowth” are gaining traction.

Differentiating green growth from agrowth and degrowth

But what do these terms signify?

The “degrowth” school of thought proposes a planned reduction in material consumption in affluent nations to achieve more sustainable and equitable societies. Meanwhile, supporters of “agrowth” adopt a neutral view of economic growth, focusing on achieving sustainability irrespective of GDP fluctuations. Essentially, both positions represent scepticism toward the predominant “green growth” paradigm with degrowth representing a more critical view.

Much of the debate centres around the concept of decoupling – whether the economy can grow without corresponding increases in environmental degradation or greenhouse gas emissions. Essentially, it signifies a separation of the historical linkage between GDP growth and its adverse environmental effects. Importantly, absolute decoupling rather than relative decoupling is necessary for green growth to succeed. In other words, emissions should decrease during economic growth, and not just grow more slowly.

Green growth proponents assert that absolute decoupling is achievable in the long term, although there is a division regarding whether there will be a short-term hit to economic growth. The degrowth perspective is critical that absolute decoupling is feasible at the global scale and can be achieved at the rapid rate required to stay within Paris climate targets. A recent study found that current rates of decoupling in high-income are falling far short of what is needed to limit global heating to well below 2°C as set out by the Paris Agreement.

The agrowth position covers more mixed, middle-ground views on the decoupling debate. Some argue that decoupling is potentially plausible under the right policies, however, the focus should be on policies rather than targets as this is confusing means and ends. Others may argue that the debate is largely irrelevant as GDP is a poor indicator of societal progress – a “GDP paradox” exists, where the indicator continues to be dominant in economics and politics despite its widely recognised failings.

7 out of 10 climate experts sceptical of green growth

How prevalent are degrowth and agrowth views among experts? As part of a recent survey completed by 789 global researchers who have published on climate change mitigation policies, we asked questions to assess the respondents’ positions on the growth debate. Strikingly, 73% of all respondents expressed views aligned with “agrowth” or “degrowth” positions, with the former being the most popular. We found that the opinions varied based on the respondent’s country and discipline (see the figure below).

While the OECD itself strongly advocates for green growth, researchers from the EU and other OECD nations demonstrated high levels of scepticism. In contrast, over half of the researchers from non-OECD nations, especially in emerging economies like the BRICS nations, were more supportive of green growth.

Disciplinary rifts

Furthermore, a disciplinary divide exists. Environmental and other social scientists, excluding orthodox economists, were the most sceptical of green growth. In contrast, economists and engineers showed the highest preference for green growth, possibly indicative of trust in technological progress and conventional economic models that suggest economic growth and climate goals are compatible.

Our analysis also examined the link between the growth positions and the GDP per capita of a respondent’s country of origin. A discernible trend emerged: as national income rises, there is increased scepticism toward green growth. At higher income levels, experts increasingly supported the post-growth argument that beyond a point, the socio-environmental costs of growth may outweigh the benefits.

The results were even more pronounced when we factored in the Inequality-adjusted Human Development Index (IHDI), suggesting that aspects beyond income, such as inequality and overall development, might influence these views.

In a world grappling with climate change and socio-economic disparities, these findings should not simply be dismissed. They underline the need for a more holistic dialogue on sustainable development, extending beyond the conventional green growth paradigm.

Post-growth thought no longer a fringe position

Although von der Leyen firmly stood in the green growth camp, this academic shift is increasingly reflected in the political debate. In May 2023, the European Parliament hosted a conference on the topic of “Beyond Growth” as an initiative of 20 MEPs from five different political groups and supported by over 50 partner organisations. Its main objective was to discuss policy proposals to move beyond the approach of national GDP growth being the primary measure of success.

Image by Alexander Droeger from Pixabay

Six national and regional governments – Scotland, New Zealand, Iceland, Wales, Finland, and Canada – have joined the Wellbeing Economy Governments (WEGo) partnership. The primary aim of the movement is to transition to “an economy designed to serve people and planet, not the other way around.”

Clearly, post-growth thought is no longer a fringe, radical position within those working on solutions to climate change. Greater attention needs to be given to why some experts are doubtful that green growth can be achieved as well as potential alternatives focussed on wider concepts of societal wellbeing rather than limited thinking in terms of GDP growth.

Ivan Savin, Associate Professor of Business Analytics at ESCP Business School, Madrid campus & Research Fellow at ICTA-UAB, ESCP Business School and Lewis King, Lecturer in climate policy and green economics, Universitat Autònoma de Barcelona

This article is republished from The Conversation under a Creative Commons license. Read the original article.

A new report reveals how stock buybacks have inflated CEO paychecks and widened pay gaps at the 100 largest low-wage corporations.

By Sarah Anderson

( Inequality.org ) – In response to strikes and union organizing drives, corporate leaders routinely insist that they simply lack the wherewithal to raise employee pay. And yet top executives seem to have little trouble finding resources for enriching themselves and wealthy shareholders.

In 2021 and 2022, S&P 500 corporations spent record sums on stock buybacks, a maneuver that pumps up stock prices by reducing the supply on the open market. Since stock-based pay makes up the bulk of executive compensation, CEOs reap huge — and completely undeserved — windfalls.

CEOs could watch cat videos all day and still reap huge windfalls through stock buybacks.

The Low-Wage 100

A new Institute for Policy Studies report, Executive Excess 2023, reveals how these financial shenanigans have widened disparities at the 100 S&P 500 corporations with the lowest median worker pay, a group we’ve dubbed the “Low-Wage 100.”

Between January 1, 2020 and May of this year, these companies reported a combined $341 billion in stock buyback spending.

Lowe’s led the buybacks list, plowing nearly $35 billion into share repurchases over the past three and a half years. In 2022 alone, Lowe’s spent more than $14 billion on buybacks — enough to give every one of its 301,000 U.S. employees a $46,923 bonus.

I’m guessing rank-and-file Lowe’s employees, half of whom make less than $30,000 per year, could find more productive uses for that money.

During their stock buyback spree, Low-Wage 100 CEOs’ personal stock holdings increased more than three times as fast as their firms’ median worker pay. At the 65 buyback companies where the same person held the top job between 2019 and 2022, the Low-Wage 100 CEOs’ personal stock holdings soared 33 percent to an average of $184.7 million. Median pay at these firms rose only 10 percent to an average of $31,972.

Image by Jonathan from Pixabay

FedEx founder and CEO Frederick Smith has the largest stockpile in the Low-Wage 100. With $3.6 billion in stock buybacks since January 2020, Smith’s personal stock holdings have grown 65 percent to more than $5 billion. By contrast, median pay for workers at the notoriously anti-union company fell by 20 percent to $39,177 during this period.

Taxpayer support for huge CEO-worker pay gaps

What makes all this even more upsetting? Taxpayers are actually supporting, through federal contracts, the buyback-fueled disparities at FedEx and 50 other Low-Wage 100 firms.

FedEx pocketed $6.2 billion in fiscal years 2020-2023 for mail services for the Veterans Administration and other agencies. The largest federal contractor in the Low-Wage 100 is another company known for union-busting — Amazon. Over the past few years, Amazon has pocketed more than $10 billion in web services deals from Uncle Sam while spending nearly $6 billion repurchasing their shares.

Fortunately, support is growing for solutions to our CEO pay problem.

Solutions to executive excess

Before 1982, stock buybacks were viewed as market manipulation and largely banned. President Joe Biden hasn’t yet called for reinstating that ban, but he did rail against buybacks in his State of the Union address this year and called for quadrupling a new 1 percent excise tax on share repurchases.

The Biden administration is also starting to use federal money going to corporations as a lever for change. In an important first step, the administration is giving preferential treatment in the awarding of new semiconductor manufacturing subsidies to companies that agree to give up buybacks. Now they should extend that policy to all corporations receiving taxpayer money.

Buybacks are not the only trick CEOs can use to inflate their own paychecks. Over my decades of research, I’ve documented how corporate leaders have used myriad shady means to hit personal jackpots, from cooking the books and moving executive bonus goalposts to creating housing bubbles and other reckless financial schemes.

To tackle this systemic problem, policymakers need to go bolder. Executive Excess 2023 offers an extensive menu of CEO pay reforms. One of the most innovative: tax penalties for companies with huge CEO-worker pay gaps. Two major cities — San Francisco and Portland, Oregon — are already generating significant revenue through such taxes. Seattle is now considering a similar approach.

The idea that the person in the corner office is hundreds of times more valuable than other employees is a myth — even if that person is not just watching cat videos. All employees contribute to the profits of a corporation, and our economy would be far healthier if the fruits of our labor were more equitably shared.

Sarah Anderson directs the Global Economy Project and co-edits Inequality.org at the Institute for Policy Studies. She is the author of the report Executive Excess 2023.

Via Inequality.org

Content licensed under a Creative Commons 3.0 License

Nolan’s film is a distinctive pop cultural phenomenon because it deals with the American use of nuclear weapons, a genuine rarity since ABC’s 1983 airing of The Day After about the consequences of nuclear war. (An earlier exception was Stanley Kubrick’s Dr. Strangelove, his satirical portrayal of the insanity of the Cold War nuclear arms race.)

The film is based on American Prometheus, the Pulitzer Prize-winning 2005 biography of Oppenheimer by Kai Bird and Martin Sherwin. Nolan made it in part to break through the shield of antiseptic rhetoric, bloodless philosophizing, and public complacency that has allowed such world-ending weaponry to persist so long after Trinity, the first nuclear bomb test, was conducted in the New Mexico desert 78 years ago this month.

Nolan’s impetus was rooted in his early exposure to the nuclear disarmament movement in Europe. As he said recently:

“It’s something that’s been on my radar for a number of years. I was a teenager in the ‘80s, the early ‘80s in England. It was the peak of CND, Campaign for Nuclear Disarmament, the Greenham Common [protest]; the threat of nuclear war was when I was 12, 13, 14 — it was the biggest fear we all had. I think I first encountered Oppenheimer in… Sting’s song about the Russians that came out then and talks about Oppenheimer’s ‘deadly toys.’”

A feature film on the genesis of nuclear weapons may not strike you as an obvious candidate for box-office blockbuster status. As Nolan’s teenage son said when his father told him he was thinking about making such a film, “Well, nobody really worries about nuclear weapons anymore. Are people going to be interested in that?” Nolan responded that, given what’s at stake, he worries about complacency and even denial when it comes to the global risks posed by the nuclear arsenals on this planet. “You’re normalizing killing tens of thousands of people. You’re creating moral equivalences, false equivalences with other types of conflict… [and so] accepting, normalizing… the danger.”

These days, unfortunately, you’re talking about anything but just tens of thousands of people dying in a nuclear face-off. A 2022 report by Ira Helfand and International Physicians for the Prevention of Nuclear War estimated that a “limited” nuclear war between India and Pakistan that used roughly 3% of the world’s 12,000-plus nuclear warheads would kill “hundreds of millions, perhaps even billions” of us. A full-scale nuclear war between the United States and Russia, the study suggests, could kill up to five (yes, five!) billion people within two years, essentially ending life as we know it on this planet in a “nuclear winter.”

Obviously, all too many of us don’t grasp the stakes involved in a nuclear conflict, thanks in part to “psychic numbing,” a concept regularly invoked by Robert Jay Lifton, author of Hiroshima in America: A History of Denial (co-authored with Greg Mitchell), among many other books. Lifton describes psychic numbing as “a diminished capacity or inclination to feel” prompted by “the completely unprecedented dimension of this revolution in technological destructiveness.”

Given the Nolan film’s focus on Oppenheimer’s story, some crucial issues related to the world’s nuclear dilemma are either dealt with only briefly or omitted altogether.

Buy the Book

The staggering devastation caused by the bombings of Hiroshima and Nagasaki is suggested only indirectly without any striking visual evidence of the devastating human consequences of the use of those two weapons. Also largely ignored are the critical voices who then argued that there was no need to drop a bomb, no less two of them, on a Japan most of whose cities had already been devastated by U.S. fire-bombing to end the war. General (and later President) Dwight D. Eisenhower wrote that when he was told by Secretary of War Henry Stimson of the plan to drop atomic bombs on populated areas in Japan, “I voiced to him my grave misgivings, first on the basis of my belief that Japan was already defeated and that dropping the bomb was completely unnecessary.”

The film also fails to address the health impacts of the research, testing, and production of such weaponry, which to this day is still causing disease and death, even without another nuclear weapon ever being used in war. Victims of nuclear weapons development include people who were impacted by the fallout from U.S. nuclear testing in the Western United States and the Marshall Islands in the Western Pacific, uranium miners on Navajo lands, and many others. Speaking of the first nuclear test in Los Alamos, New Mexico, Tina Cordova of the Tularosa Basin Downwinders Consortium, which represents that state’s residents who suffered widespread cancers and high rates of infant mortality caused by radiation from that explosion, said “It’s an inconvenient truth… People just don’t want to reflect on the fact that American citizens were bombed at Trinity.”

Another crucially important issue has received almost no attention. Neither the film nor the discussion sparked by it has explored one of the most important reasons for the continued existence of nuclear weapons — the profits it yields the participants in America’s massive nuclear-industrial complex.

Once Oppenheimer and other concerned scientists and policymakers failed to convince the Truman administration to simply close Los Alamos and place nuclear weapons and the materials needed to develop them under international control — the only way, as they saw it, to head off a nuclear arms race with the Soviet Union — the drive to expand the nuclear weapons complex was on. Research and production of nuclear warheads and nuclear-armed bombers, missiles, and submarines quickly became a big business, whose beneficiaries have worked doggedly to limit any efforts at the reduction or elimination of nuclear arms.

The Manhattan Project and the Birth of the Nuclear-Industrial Complex

The Manhattan Project Oppenheimer directed was one of the largest public works efforts ever undertaken in American history. Though the Oppenheimer film focuses on Los Alamos, it quickly came to include far-flung facilities across the United States. At its peak, the project would employ 130,000 workers — as many as in the entire U.S. auto industry at the time.

According to nuclear expert Stephen Schwartz, author of Atomic Audit, the seminal work on the financing of U.S. nuclear weapons programs, through the end of 1945 the Manhattan Project cost nearly $38 billion in today’s dollars, while helping spawn an enterprise that has since cost taxpayers an almost unimaginable $12 trillion for nuclear weapons and related programs. And the costs never end. The Nobel prize-winning International Campaign to Abolish Nuclear Weapons (ICAN) reports that the U.S. spent $43.7 billion on nuclear weapons last year alone, and a new Congressional Budget Office report suggests that another $756 billion will go into those deadly armaments in the next decade.

Private contractors now run the nuclear warhead complex and build nuclear delivery vehicles. They range from Raytheon, General Dynamics, and Lockheed Martin to lesser-known firms like BWX Technologies and Jacobs Engineering, all of which split billions of dollars in contracts from the Pentagon (for the production of nuclear delivery vehicles) and the Department of Energy (for nuclear warheads). To keep the gravy train running — ideally, in perpetuity — those contractors also spend millions lobbying decision-makers. Even universities have gotten into the act. Both the University of California and Texas A&M are part of the consortium that runs the Los Alamos nuclear weapons laboratory.

The American warhead complex is a vast enterprise with major facilities in California, Missouri, Nevada, New Mexico, South Carolina, Tennessee, and Texas. And nuclear-armed submarines, bombers, and missiles are produced or based in California, Connecticut, Georgia, Louisiana, North Dakota, Montana, Virginia, Washington state, and Wyoming. Add in nuclear subcontractors and most states host at least some nuclear-weapons-related activities.

And such beneficiaries of the nuclear weapons industry are far from silent when it comes to debating the future of nuclear spending and policy-making.

Profiteers of Armageddon: The Nuclear Weapons Lobby

The institutions and companies that build nuclear bombs, missiles, aircraft, and submarines, along with their allies in Congress, have played a disproportionate role in shaping U.S. nuclear policy and spending. They have typically opposed the U.S. ratification of a Comprehensive Nuclear Test Ban treaty; put strict limits on the ability of Congress to reduce either funding for or the deployment of intercontinental ballistic missiles (ICBMs); and pushed for weaponry like a proposed nuclear-armed, sea-launched cruise missile that even the Pentagon hasn’t requested, while funding think tanks that promote an ever more robust nuclear weapons force.

A case in point is the Senate ICBM Coalition (dubbed part of the “Dr. Strangelove Caucus” by Arms Control Association Director Daryl Kimball and other critics of nuclear arms). The ICBM Coalition consists of senators from states with major ICBM bases or ICBM research, maintenance, and production sites: Montana, North Dakota, Utah, and Wyoming. The sole Democrat in the group, Jon Tester (D-MT), is the chair of the powerful appropriations subcommittee of the Senate Appropriations Committee, where he can keep an eye on ICBM spending and advocate for it as needed.

The Senate ICBM Coalition is responsible for numerous measures aimed at protecting both the funding and deployment of such deadly missiles. According to former Secretary of Defense William Perry, they are among “the most dangerous weapons we have” because a president, if warned of a possible nuclear attack on this country, would have just minutes to decide to launch them, risking a nuclear conflict based on a false alarm. That Coalition’s efforts are supplemented by persistent lobbying from a series of local coalitions of business and political leaders in those ICBM states. Most of them work closely with Northrop Grumman, the prime contractor for the new ICBM, dubbed the Sentinel and expected to cost at least $264 billion to develop, build, and maintain over its life span that is expected to exceed 60 years.

Of course, Northrop Grumman and its 12 major ICBM subcontractors have been busy pushing the Sentinel as well. They spend tens of millions of dollars on campaign contributions and lobbying annually, while employing former members of the government’s nuclear establishment to make their case to Congress and the executive branch. And those are hardly the only organizations or networks devoted to sustaining the nuclear arms race. You would have to include the Air Force Association and the obscurely named Submarine Industrial Base Council, among others.

The biggest point of leverage the nuclear weapons industry and the arms sector more broadly have over Congress is jobs. How strange then that the arms industry has generated diminishing job returns since the end of the Cold War. According to the National Defense Industrial Association, direct employment in the weapons industry has dropped from 3.2 million in the mid-1980s to about 1.1 million today.

Even a relatively small slice of the Pentagon and Department of Energy nuclear budgets could create many more jobs if invested in green energy, sustainable infrastructure, education, or public health – anywhere from 9% to 250% more jobs, depending on the amount spent. Given that the climate crisis is already well underway, such a shift would not only make this country more prosperous but the world safer by slowing the pace of climate-driven catastrophes and offering at least some protection against its worst manifestations.

A New Nuclear Reckoning?

Count on one thing: by itself, a movie focused on the origin of nuclear weapons, no matter how powerful, won’t force a new reckoning with the costs and consequences of America’s continued addiction to them. But a wide variety of peace, arms-control, health, and public-policy-focused groups are already building on the attention garnered by the film to engage in a public education campaign aimed at reviving a movement to control and eventually eliminate the nuclear danger.

Past experience — from the Campaign for Nuclear Disarmament that helped persuade Christopher Nolan to make Oppenheimer to the “Ban the Bomb” and Nuclear Freeze campaigns that stopped above-ground nuclear testing and helped turn President Ronald Reagan around on the nuclear issue — suggests that, given concerted public pressure, progress can be made on reining in the nuclear threat. The public education effort surrounding the Oppenheimer film is being taken up by groups like The Bulletin of the Atomic Scientists, the Federation of American Scientists, and the Council for a Livable World that were founded, at least in part, by Manhattan Project scientists who devoted their lives to trying to roll back the nuclear arms race; professional groups like the Union of Concerned Scientists and Physicians for Social Responsibility; anti-war groups like Peace Action and Win Without War; the Nobel Peace prize-winning International Campaign to Abolish Nuclear Weapons; nuclear policy groups like Global Zero and the Arms Control Association; advocates for Marshall Islanders, “downwinders,” and other victims of the nuclear complex; and faith-based groups like the Friends Committee on National Legislation. The Native American–led organization Tewa Women United has even created a website, “Oppenheimer — and the Other Side of the Story,” that focuses on “the Indigenous and land-based peoples who were displaced from our homelands, the poisoning and contamination of sacred lands and waters that continues to this day, and the ongoing devastating impact of nuclear colonization on our lives and livelihoods.”

On the global level, the 2021 entry into force of a nuclear ban treaty — officially known as the Treaty on the Prohibition of Nuclear Weapons — is a sign of hope, even if the nuclear weapons states have yet to join. The very existence of such a treaty does at least help delegitimize nuclear weaponry. It has even prompted dozens of major financial institutions to stop investing in the nuclear weapons industry, under pressure from campaigns like Don’t Bank on the Bomb.

In truth, the situation couldn’t be simpler: we need to abolish nuclear weapons before they abolish us. Hopefully, Oppenheimer will help prepare the ground for progress in that all too essential undertaking, beginning with a frank discussion of what’s now at stake.

Copyright 2023 William D. Hartung

Via Tomdispatch.com

( Tomdispatch.com ) – An aged Native-American chieftain was visiting New York City for the first time in 1906. He was curious about the city and the city was curious about him. A magazine reporter asked the chief what most surprised him in his travels around town. “Little children working,” the visitor replied. 

Child labor might have shocked that outsider, but it was all too commonplace then across urban, industrial America (and on farms where it had been customary for centuries). In more recent times, however, it’s become a far rarer sight. Law and custom, most of us assume, drove it to near extinction. And our reaction to seeing it reappear might resemble that chief’s — shock, disbelief. 

But we better get used to it, since child labor is making a comeback with a vengeance. A striking number of lawmakers are undertaking concerted efforts to weaken or repeal statutes that have long prevented (or at least seriously inhibited) the possibility of exploiting children. 

Take a breath and consider this: the number of kids at work in the U.S. increased by 37% between 2015 and 2022. During the last two years, 14 states have either introduced or enacted legislation rolling back regulations that governed the number of hours children can be employed, lowered the restrictions on dangerous work, and legalized subminimum wages for youths.

Iowa now allows those as young as 14 to work in industrial laundries. At age 16, they can take jobs in roofing, construction, excavation, and demolition and can operate power-driven machinery. Fourteen-year-olds can now even work night shifts and once they hit 15 can join assembly lines. All of this was, of course, prohibited not so long ago.    

Legislators offer fatuous justifications for such incursions into long-settled practice. Working, they tell us, will get kids off their computers or video games or away from the TV. Or it will strip the government of the power to dictate what children can and can’t do, leaving parents in control — a claim already transformed into fantasy by efforts to strip away protective legislation and permit 14-year-old kids to work without formal parental permission.

In 2014, the Cato Institute, a right-wing think tank, published “A Case Against Child Labor Prohibitions,” arguing that such laws stifled opportunity for poor — and especially Black — children. The Foundation for Government Accountability, a think tank funded by a range of wealthy conservative donors including the DeVos family, has spearheaded efforts to weaken child-labor laws, and Americans for Prosperity, the billionaire Koch brothers’ foundation, has joined in.

Nor are these assaults confined to red states like Iowa or the South. California, Maine, Michigan, Minnesota, and New Hampshire, as well as Georgia and Ohio, have been targeted, too. Even New Jersey passed a law in the pandemic years temporarily raising the permissible work hours for 16- to 18-year-olds.

The blunt truth of the matter is that child labor pays and is fast becoming remarkably ubiquitous. It’s an open secret that fast-food chains have employed underage kids for years and simply treat the occasional fines for doing so as part of the cost of doing business. Children as young as 10 have been toiling away in such pit stops in Kentucky and older ones working beyond the hourly limits prescribed by law. Roofers in Florida and Tennessee can now be as young as 12.

Recently, the Labor Department found more than 100 children between the ages of 13 and 17 working in meatpacking plants and slaughterhouses in Minnesota and Nebraska. And those were anything but fly-by-night operations. Companies like Tyson Foods and Packer Sanitation Services (owned by BlackRock, the world’s largest asset management firm) were also on the list.

At this point, virtually the entire economy is remarkably open to child labor. Garment factories and auto parts manufacturers (supplying Ford and General Motors) employ immigrant kids, some for 12-hour days. Many are compelled to drop out of school just to keep up. In a similar fashion, Hyundai and Kia supply chains depend on children working in Alabama.

As the New York Times reported last February, helping break the story of the new child labor market, underage kids, especially migrants, are working in cereal-packing plants and food-processing factories. In Vermont, “illegals” (because they’re too young to work) operate milking machines. Some children help make J. Crew shirts in Los Angeles, bake rolls for Walmart, or work producing Fruit of the Loom socks. Danger lurks. America is a notoriously unsafe place to work and the accident rate for child laborers is especially high, including a chilling inventory of shattered spines, amputations, poisonings, and disfiguring burns.  

Buy the Book

Journalist Hannah Dreier has called it “a new economy of exploitation,” especially when it comes to migrant children. A Grand Rapids, Michigan, schoolteacher, observing the same predicament, remarked: “You’re taking children from another country and putting them almost in industrial servitude.”

The Long Ago Now

Today, we may be as stunned by this deplorable spectacle as that chief was at the turn of the twentieth century. Our ancestors, however, would not have been. For them, child labor was taken for granted. 

Hard work, moreover, had long been considered by those in the British upper classes who didn’t have to do so as a spiritual tonic that would rein in the unruly impulses of the lower orders.  An Elizabethan law of 1575 provided public money to employ children as “a prophylactic against vagabonds and paupers.”

By the eighteenth century, the philosopher John Locke, then a celebrated champion of liberty, was arguing that three-year-olds should be included in the labor force. Daniel Defoe, author of Robinson Crusoe, was happy that “children after four or five years of age could every one earn their own bread.” Later, Jeremy Bentham, the father of utilitarianism, would opt for four, since otherwise, society would suffer the loss of “precious years in which nothing is done! Nothing for Industry! Nothing for improvement, moral or intellectual.”

American “founding father” Alexander Hamilton’s 1791 Report on Manufacturing noted that children “who would otherwise be idle” could instead become a source of cheap labor. And such claims that working at an early age warded off the social dangers of “idleness and degeneracy” remained a fixture of elite ideology well into the modern era. Indeed, it evidently remains so today. 

When industrialization began in earnest during the first half of the nineteenth century, observers noted that work in the new factories (especially textile mills) was “better done by little girls of 6-12 years old.” By 1820, children accounted for 40% of the mill workers in three New England states. In that same year, children under 15 made up 23% of the manufacturing labor force and as much as 50% of the production of cotton textiles.

And such numbers would only soar after the Civil War. In fact, the children of ex-slaves were effectively re-enslaved through onerous apprenticeship arrangements. Meanwhile, in New York City and other urban centers, Italian padrones expedited the exploitation of immigrant kids while treating them brutally.  Even the then-brahmin-minded, anti-immigrant New York Times took offense: “The world has given up stealing men from the African coast, only to kidnap children from Italy.”

Between 1890 and 1910, 18% of all children between the ages of 10 and 15, about two million young people, worked, often 12 hours a day, six days a week.

Their jobs covered the waterfront — all too literally as, under the supervision of padrones, thousands of children shucked oysters and picked shrimp. Kids were also street messengers and newsies. They worked in offices and factories, banks and brothels. They were “breakers” and “trappers” in poorly ventilated coal mines, particularly dangerous and unhealthy jobs. In 1900, out of 100,000 workers in textile mills in the South, 20,000 were under the age of 12.

City orphans were shipped off to labor in the glassworks of the Midwest. Thousands of children stayed home and helped their families turn out clothing for sweatshop manufacturers. Others packed flowers in ill-ventilated tenements. One seven-year-old explained that “I like school better than home. I don’t like home. There are too many flowers.” And down on the farm, the situation was no less grim, as children as young as three worked hulling berries.

All in the Family               

Clearly, well into the twentieth century, industrial capitalism depended on the exploitation of children who were cheaper to employ, less able to resist, and until the advent of more sophisticated technologies, well suited to deal with the relatively simple machinery then in place.

Moreover, the authority exercised by the boss was in keeping with that era’s patriarchal assumptions, whether in the family or even in the largest of the overwhelmingly family-owned new industrial firms of that time like Andrew Carnegie’s steelworks. And such family capitalism gave birth to a perverse alliance of boss and underling that transformed children into miniature wage-laborers.

Meanwhile, working-class families were so severely exploited that they desperately needed the income of their children. As a result, in Philadelphia around the turn of the century, the labor of children accounted for between 28% and 33% of the household income of native-born, two-parent families. For Irish and German immigrants, the figures were 46% and 35% respectively. Not surprisingly, then, working-class parents often opposed proposals for child labor laws. As noted by Karl Marx, the worker was no longer able to support himself, so “now he sells his wife and child. He becomes a slave dealer.”  

Nonetheless, resistance began to mount. The sociologist and muckraking photographer Lewis Hine scandalized the country with heart-rending pictures of kids slaving away in factories and down in the pits of mines. (He got into such places by pretending to be a Bible salesman.) Mother Jones, the militant defender of labor organizing, led a “children’s crusade” in 1903 on behalf of 46,000 striking textile workers in Philadelphia. Two hundred child-worker delegates showed up at President Teddy Roosevelt’s Oyster Bay, Long Island, residence to protest, but the president simply passed the buck, claiming child labor was a state matter, not a federal one.

Here and there, kids tried running away. In response, owners began surrounding their factories with barbed wire or made the children work at night when their fear of the dark might keep them from fleeing. Some of the 146 women who died in the infamous Triangle Shirtwaist Factory fire of 1911 in Manhattan’s Greenwich Village — the owners of that garment factory had locked the doors, forcing the trapped workers to leap to their deaths from upper floor windows — were as young as 15. That tragedy only added to a growing furor over child labor.

A National Child Labor Committee was formed in 1904. For years, it lobbied states to outlaw, or at least rein in, the use of child labor. Victories, however, were often distinctly pyrrhic, as the laws enacted were invariably weak, included dozens of exemptions, and poorly enforced. Finally, in 1916, a federal law was passed that outlawed child labor everywhere. In 1918, however, the Supreme Court declared it unconstitutional.

In fact, only in the 1930s, after the Great Depression hit, did conditions begin improving. Given its economic devastation, you might assume that cheap child labor would have been at a premium. However, with jobs so scarce, adults — males especially — took precedence and began doing work once relegated to children. In those same years, industrial work began incorporating ever more complex machinery that proved too difficult for younger kids. Meanwhile, the age of compulsory schooling was steadily rising, limiting yet more the available pool of child laborers. 

Most important of all, the tenor of the times changed.  The insurgent labor movement of the 1930s loathed the very idea of child labor. Unionized plants and whole industries were no-go zones for capitalists looking to exploit children. And in 1938, with the support of organized labor, President Franklin Roosevelt’s New Deal administration finally passed the Fair Labor Standards Act which, at least in theory, put an end to child labor (although it exempted the agricultural sector in which such a workforce remained commonplace).

Moreover, Roosevelt’s New Deal transformed the national zeitgeist. A sense of economic egalitarianism, a newfound respect for the working class, and a bottomless suspicion of the corporate caste made child labor seem particularly repulsive. In addition, the New Deal ushered in a long era of prosperity, including rising standards of living for millions of working people who no longer needed the labor of their children to make ends meet.

Back to the Future

It’s all the more astonishing then to discover that a plague, once thought banished, lives again. American capitalism is a global system, its networks extend virtually everywhere. Today, there are an estimated 152 million children at work worldwide. Not all of them, of course, are employed directly or even indirectly by U.S. firms. But they should certainly be a reminder of how deeply retrogressive capitalism has once again become both here at home and elsewhere across the planet.

Boasts about the power and wealth of the American economy are part of our belief system and elite rhetoric. However, life expectancy in the U.S., a basal measure of social retrogression, has been relentlessly declining for years. Health care is not only unaffordable for millions, but its quality has become second-rate at best if you don’t belong to the top 1%. In a similar fashion, the country’s infrastructure has long been in decline, thanks to both its age and decades of neglect. 

Think of the United States, then, as a “developed” country now in the throes of underdevelopment and, in that context, the return of child labor is deeply symptomatic. Even before the Great Recession that followed the financial implosion of 2008, standards of living had been falling, especially for millions of working people laid low by a decades-long tsunami of de-industrialization. That recession, which officially lasted until 2011, only further exacerbated the situation. It put added pressure on labor costs, while work became increasingly precarious, ever more stripped of benefits and ununionized. Given the circumstances, why not turn to yet another source of cheap labor — children? 

The most vulnerable among them come from abroad, migrants from the Global South, escaping failing economies often traceable to American economic exploitation and domination. If this country is now experiencing a border crisis — and it is — its origins lie on this side of the border.

The Covid-19 pandemic of 2020-2022 created a brief labor shortage, which became a pretext for putting kids back to work (even if the return of child labor actually predated the disease). Consider such child workers in the twenty-first century as a distinct sign of social pathology. The United States may still bully parts of the world, while endlessly showing off its military might. At home, however, it is sick.

Copyright 2023 Steve Fraser

Tomdispatch.com