On the third Wednesday of every month, the nine members of an elite Wall Street society gather in Midtown Manhattan.
The men share a common goal: to protect the interests of big banks in the vast market for derivatives, one of the most profitable — and controversial — fields in finance. They also share a common secret: The details of their meetings, even their identities, have been strictly confidential.
Drawn from giants like JPMorgan Chase, Goldman Sachs and Morgan Stanley, the bankers form a powerful committee that helps oversee trading in derivatives, instruments which, like insurance, are used to hedge risk.
In theory, this group exists to safeguard the integrity of the multitrillion-dollar market. In practice, it also defends the dominance of the big banks.
The banks in this group, which is affiliated with a new derivatives clearinghouse, have fought to block other banks from entering the market, and they are also trying to thwart efforts to make full information on prices and fees freely available.
Banks’ influence over this market, and over clearinghouses like the one this select group advises, has costly implications for businesses large and small, like Dan Singer’s home heating-oil company in Westchester County, north of New York City.
This fall, many of Mr. Singer’s customers purchased fixed-rate plans to lock in winter heating oil at around $3 a gallon. While that price was above the prevailing $2.80 a gallon then, the contracts will protect homeowners if bitterly cold weather pushes the price higher.
But Mr. Singer wonders if his company, Robison Oil, should be getting a better deal. He uses derivatives like swaps and options to create his fixed plans. But he has no idea how much lower his prices — and his customers’ prices — could be, he says, because banks don’t disclose fees associated with the derivatives.
“At the end of the day, I don’t know if I got a fair price, or what they’re charging me,” Mr. Singer said.
Derivatives shift risk from one party to another, and they offer many benefits, like enabling Mr. Singer to sell his fixed plans without having to bear all the risk that oil prices could suddenly rise. Derivatives are also big business on Wall Street. Banks collect many billions of dollars annually in undisclosed fees associated with these instruments — an amount that almost certainly would be lower if there were more competition and transparent prices.
Just how much derivatives trading costs ordinary Americans is uncertain. The size and reach of this market has grown rapidly over the past two decades. Pension funds today use derivatives to hedge investments. States and cities use them to try to hold down borrowing costs. Airlines use them to secure steady fuel prices. Food companies use them to lock in prices of commodities like wheat or beef.
The marketplace as it functions now “adds up to higher costs to all Americans,” said Gary Gensler, the chairman of the Commodity Futures Trading Commission, which regulates most derivatives. More oversight of the banks in this market is needed, he said.
But big banks influence the rules governing derivatives through a variety of industry groups. The banks’ latest point of influence are clearinghouses like ICE Trust, which holds the monthly meetings with the nine bankers in New York.
Under the Dodd-Frank financial overhaul, many derivatives will be traded via such clearinghouses. Mr. Gensler wants to lessen banks’ control over these new institutions. But Republican lawmakers, many of whom received large campaign contributions from bankers who want to influence how the derivatives rules are written, say they plan to push back against much of the coming reform. On Thursday, the commission canceled a vote over a proposal to make prices more transparent, raising speculation that Mr. Gensler did not have enough support from his fellow commissioners.
The Department of Justice is looking into derivatives, too. The department’s antitrust unit is actively investigating “the possibility of anticompetitive practices in the credit derivatives clearing, trading and information services industries,” according to a department spokeswoman.
Indeed, the derivatives market today reminds some experts of the Nasdaq stock market in the 1990s. Back then, the Justice Department discovered that Nasdaq market makers were secretly colluding to protect their own profits. Following that scandal, reforms and electronic trading systems cut Nasdaq stock trading costs to 1/20th of their former level — an enormous savings for investors.
“When you limit participation in the governance of an entity to a few like-minded institutions or individuals who have an interest in keeping competitors out, you have the potential for bad things to happen. It’s antitrust 101,” said Robert E. Litan, who helped oversee the Justice Department’s Nasdaq investigation as deputy assistant attorney general and is now a fellow at the Kauffman Foundation. “The history of derivatives trading is it has grown up as a very concentrated industry, and old habits are hard to break.”
Representatives from the nine banks that dominate the market declined to comment on the Department of Justice investigation.
Clearing involves keeping track of trades and providing a central repository for money backing those wagers. A spokeswoman for Deutsche Bank, which is among the most influential of the group, said this system will reduce the risks in the market. She said that Deutsche is focused on ensuring this process is put in place without disrupting the marketplace.
The Deutsche spokeswoman also said the banks’ role in this process has been a success, saying in a statement that the effort “is one of the best examples of public-private partnerships.”
Established, But Can’t Get In
The Bank of New York Mellon’s origins go back to 1784, when it was founded by Alexander Hamilton. Today, it provides administrative services on more than $23 trillion of institutional money.
Recently, the bank has been seeking to enter the inner circle of the derivatives market, but so far, it has been rebuffed.
Bank of New York officials say they have been thwarted by competitors who control important committees at the new clearinghouses, which were set up in the wake of the financial crisis.
Bank of New York Mellon has been trying to become a so-called clearing member since early this year. But three of the four main clearinghouses told the bank that its derivatives operation has too little capital, and thus potentially poses too much risk to the overall market.
The bank dismisses that explanation as absurd. “We are not a nobody,” said Sanjay Kannambadi, chief executive of BNY Mellon Clearing, a subsidiary created to get into the business. “But we don’t qualify. We certainly think that’s kind of crazy.”
The real reason the bank is being shut out, he said, is that rivals want to preserve their profit margins, and they are the ones who helped write the membership rules.
Mr. Kannambadi said Bank of New York’s clients asked it to enter the derivatives business because they believe they are being charged too much by big banks. Its entry could lower fees. Others that have yet to gain full entry to the derivatives trading club are the State Street Corporation, and small brokerage firms like MF Global and Newedge.
The criteria seem arbitrary, said Marcus Katz, a senior vice president at Newedge, which is owned by two big French banks.
“It appears that the membership criteria were set so that a certain group of market participants could meet that, and everyone else would have to jump through hoops,” Mr. Katz said.
The one new derivatives clearinghouse that has welcomed Newedge, Bank of New York and the others — Nasdaq — has been avoided by the big derivatives banks.
Only the Insiders Know
How did big banks come to have such influence that they can decide who can compete with them?
Ironically, this development grew in part out of worries during the height of the financial crisis in 2008. A major concern during the meltdown was that no one — not even government regulators — fully understood the size and interconnections of the derivatives market, especially the market in credit default swaps, which insure against defaults of companies or mortgages bonds. The panic led to the need to bail out the American International Group, for instance, which had C.D.S. contracts with many large banks.
In the midst of the turmoil, regulators ordered banks to speed up plans — long in the making — to set up a clearinghouse to handle derivatives trading. The intent was to reduce risk and increase stability in the market.
Two established exchanges that trade commodities and futures, the InterContinentalExchange, or ICE, and the Chicago Mercantile Exchange, set up clearinghouses, and, so did Nasdaq.
Each of these new clearinghouses had to persuade big banks to join their efforts, and they doled out membership on their risk committees, which is where trading rules are written, as an incentive.
None of the three clearinghouses would divulge the members of their risk committees when asked by a reporter. But two people with direct knowledge of ICE’s committee said the bank members are: Thomas J. Benison of JPMorgan Chase & Company; James J. Hill of Morgan Stanley; Athanassios Diplas of Deutsche Bank; Paul Hamill of UBS; Paul Mitrokostas of Barclays; Andy Hubbard of Credit Suisse; Oliver Frankel of Goldman Sachs; Ali Balali of Bank of America; and Biswarup Chatterjee of Citigroup.
Through representatives, these bankers declined to discuss the committee or the derivatives market. Some of the spokesmen noted that the bankers have expertise that helps the clearinghouse.
Many of these same people hold influential positions at other clearinghouses, or on committees at the powerful International Swaps and Derivatives Association, which helps govern the market.
Critics have called these banks the “derivatives dealers club,” and they warn that the club is unlikely to give up ground easily.
“The revenue these dealers make on derivatives is very large and so the incentive they have to protect those revenues is extremely large,” said Darrell Duffie, a professor at the Graduate School of Business at Stanford University, who studied the derivatives market earlier this year with Federal Reserve researchers. “It will be hard for the dealers to keep their market share if everybody who can prove their creditworthiness is allowed into the clearinghouses. So they are making arguments that others shouldn’t be allowed in.”
Perhaps no business in finance is as profitable today as derivatives. Not making loans. Not offering credit cards. Not advising on mergers and acquisitions. Not managing money for the wealthy.
The precise amount that banks make trading derivatives isn’t known, but there is anecdotal evidence of their profitability. Former bank traders who spoke on condition of anonymity because of confidentiality agreements with their former employers said their banks typically earned $25,000 for providing $25 million of insurance against the risk that a corporation might default on its debt via the swaps market. These traders turn over millions of dollars in these trades every day, and credit default swaps are just one of many kinds of derivatives.
The secrecy surrounding derivatives trading is a key factor enabling banks to make such large profits.
If an investor trades shares of Google or Coca-Cola or any other company on a stock exchange, the price — and the commission, or fee — are known. Electronic trading has made this information available to anyone with a computer, while also increasing competition — and sharply lowering the cost of trading. Even corporate bonds have become more transparent recently. Trading costs dropped there almost immediately after prices became more visible in 2002.
Not so with derivatives. For many, there is no central exchange, like the New York Stock Exchange or Nasdaq, where the prices of derivatives are listed. Instead, when a company or an investor wants to buy a derivative contract for, say, oil or wheat or securitized mortgages, an order is placed with a trader at a bank. The trader matches that order with someone selling the same type of derivative.
Banks explain that many derivatives trades have to work this way because they are often customized, unlike shares of stock. One share of Google is the same as any other. But the terms of an oil derivatives contract can vary greatly.
And the profits on most derivatives are masked. In most cases, buyers are told only what they have to pay for the derivative contract, say $25 million. That amount is more than the seller gets, but how much more — $5,000, $25,000 or $50,000 more — is unknown. That’s because the seller also is told only the amount he will receive. The difference between the two is the bank’s fee and profit. So, the bigger the difference, the better for the bank — and the worse for the customers.
It would be like a real estate agent selling a house, but the buyer knowing only what he paid and the seller knowing only what he received. The agent would pocket the difference as his fee, rather than disclose it. Moreover, only the real estate agent — and neither buyer nor seller — would have easy access to the prices paid recently for other homes on the same block.
An Electronic Exchange?
Two years ago, Kenneth C. Griffin, owner of the giant hedge fund Citadel Group, which is based in Chicago, proposed open pricing for commonly traded derivatives, by quoting their prices electronically. Citadel oversees $11 billion in assets, so saving even a few percentage points in costs on each trade could add up to tens or even hundreds of millions of dollars a year.
But Mr. Griffin’s proposal for an electronic exchange quickly ran into opposition, and what happened is a window into how banks have fiercely fought competition and open pricing. To get a transparent exchange going, Citadel offered the use of its technological prowess for a joint venture with the Chicago Mercantile Exchange, which is best-known as a trading outpost for contracts on commodities like coffee and cotton. The goal was to set up a clearinghouse as well as an electronic trading system that would display prices for credit default swaps.
Big banks that handle most derivatives trades, including Citadel’s, didn’t like Citadel’s idea. Electronic trading might connect customers directly with each other, cutting out the banks as middlemen.
So the banks responded in the fall of 2008 by pairing with ICE, one of the Chicago Mercantile Exchange’s rivals, which was setting up its own clearinghouse. The banks attached a number of conditions on that partnership, which came in the form of a merger between ICE’s clearinghouse and a nascent clearinghouse that the banks were establishing. These conditions gave the banks significant power at ICE’s clearinghouse, according to two people with knowledge of the deal. For instance, the banks insisted that ICE install the chief executive of their effort as the head of the joint effort. That executive, Dirk Pruis, left after about a year and now works at Goldman Sachs. Through a spokesman, he declined to comment.
The banks also refused to allow the deal with ICE to close until the clearinghouse’s rulebook was established, with provisions in the banks’ favor. Key among those were the membership rules, which required members to hold large amounts of capital in derivatives units, a condition that was prohibitive even for some large banks like the Bank of New York.
The banks also required ICE to provide market data exclusively to Markit, a little-known company that plays a pivotal role in derivatives. Backed by Goldman, JPMorgan and several other banks, Markit provides crucial information about derivatives, like prices.
Kevin Gould, who is the president of Markit and was involved in the clearinghouse merger, said the banks were simply being prudent and wanted rules that protected the market and themselves.
“The one thing I know the banks are concerned about is their risk capital,” he said. “You really are going to get some comfort that the way the entity operates isn’t going to put you at undue risk.”
Even though the banks were working with ICE, Citadel and the C.M.E. continued to move forward with their exchange. They, too, needed to work with Markit, because it owns the rights to certain derivatives indexes. But Markit put them in a tough spot by basically insisting that every trade involve at least one bank, since the banks are the main parties that have licenses with Markit.
This demand from Markit effectively secured a permanent role for the big derivatives banks since Citadel and the C.M.E. could not move forward without Markit’s agreement. And so, essentially boxed in, they agreed to the terms, according to the two people with knowledge of the matter. (A spokesman for C.M.E. said last week that the exchange did not cave to Markit’s terms.)
Still, even after that deal was complete, the Chicago Mercantile Exchange soon had second thoughts about working with Citadel and about introducing electronic screens at all. The C.M.E. backed out of the deal in mid-2009, ending Mr. Griffin’s dream of a new, electronic trading system.
With Citadel out of the picture, the banks agreed to join the Chicago Mercantile Exchange’s clearinghouse effort. The exchange set up a risk committee that, like ICE’s committee, was mainly populated by bankers.
It remains unclear why the C.M.E. ended its electronic trading initiative. Two people with knowledge of the Chicago Mercantile Exchange’s clearinghouse said the banks refused to get involved unless the exchange dropped Citadel and the entire plan for electronic trading.
Kim Taylor, the president of Chicago Mercantile Exchange’s clearing division, said “the market” simply wasn’t interested in Mr. Griffin’s idea.
Critics now say the banks have an edge because they have had early control of the new clearinghouses’ risk committees. Ms. Taylor at the Chicago Mercantile Exchange said the people on those committees are supposed to look out for the interest of the broad market, rather than their own narrow interests. She likened the banks’ role to that of Washington lawmakers who look out for the interests of the nation, not just their constituencies.
“It’s not like the sort of representation where if I’m elected to be the representative from the state of Illinois, I go there to represent the state of Illinois,” Ms. Taylor said in an interview.
Officials at ICE, meantime, said they solicit views from customers through a committee that is separate from the bank-dominated risk committee.
“We spent and we still continue to spend a lot of time on thinking about governance,” said Peter Barsoom, the chief operating officer of ICE Trust. “We want to be sure that we have all the right stakeholders appropriately represented.”
Mr. Griffin said last week that customers have so far paid the price for not yet having electronic trading. He puts the toll, by a rough estimate, in the tens of billions of dollars, saying that electronic trading would remove much of this “economic rent the dealers enjoy from a market that is so opaque.”
“It’s a stunning amount of money,” Mr. Griffin said. “The key players today in the derivatives market are very apprehensive about whether or not they will be winners or losers as we move towards more transparent, fairer markets, and since they’re not sure if they’ll be winners or losers, their basic instinct is to resist change.”
In, Out and Around Henhouse
The result of the maneuvering of the past couple years is that big banks dominate the risk committees of not one, but two of the most prominent new clearinghouses in the United States.
That puts them in a pivotal position to determine how derivatives are traded.
Under the Dodd-Frank bill, the clearinghouses were given broad authority. The risk committees there will help decide what prices will be charged for clearing trades, on top of fees banks collect for matching buyers and sellers, and how much money customers must put up as collateral to cover potential losses.
Perhaps more important, the risk committees will recommend which derivatives should be handled through clearinghouses, and which should be exempt.
Regulators will have the final say. But banks, which lobbied heavily to limit derivatives regulation in the Dodd-Frank bill, are likely to argue that few types of derivatives should have to go through clearinghouses. Critics contend that the bankers will try to keep many types of derivatives away from the clearinghouses, since clearinghouses represent a step towards broad electronic trading that could decimate profits.
The banks already have a head start. Even a newly proposed rule to limit the banks’ influence over clearing allows them to retain majorities on risk committees. It remains unclear whether regulators creating the new rules — on topics like transparency and possible electronic trading — will drastically change derivatives trading, or leave the bankers with great control.
One former regulator warned against deferring to the banks. Theo Lubke, who until this fall oversaw the derivatives reforms at the Federal Reserve Bank of New York, said banks do not always think of the market as a whole as they help write rules.
“Fundamentally, the banks are not good at self-regulation,” Mr. Lubke said in a panel last March at Columbia University. “That’s not their expertise, that’s not their primary interest.”
LOUISE STORY NY Times
Sunday, December 12, 2010
More BREYER
Breyer: Founding Fathers Would Have Allowed Restrictions on Guns
If you look at the values and the historical record, you will see that the Founding Fathers never intended guns to go unregulated, Supreme Court Justice Stephen Breyer contended Sunday.
Appearing on "Fox News Sunday," Breyer said history stands with the dissenters in the court's decision to overturn a Washington, D.C., handgun ban in the 2008 case "D.C. v. Heller."
Breyer wrote the dissent and was joined by Justices John Paul Stevens, David H. Souter and Ruth Bader Ginsburg. He said historians would side with him in the case because they have concluded that Founding Father James Madison was more worried that the Constitution may not be ratified than he was about granting individuals the right to bear arms.
Madison "was worried about opponents who would think Congress would call up state militias and nationalize them. 'That can't happen,' said Madison," said Breyer, adding that historians characterize Madison's priority as, "I've got to get this document ratified."
Therefore, Madison included the Second Amendment to appease the states, Breyer said.
"If you're interested in history, and in this one history was important, then I think you do have to pay attention to the story," Breyer said. "If that was his motive historically, the dissenters were right. And I think more of the historians were with us."
That being the case, and particularly since the Founding Fathers did not foresee how modern day would change individual behavior, government bodies can impose regulations on guns, Breyer concluded.
In July 2008, the concurring opinion in "D.C. v. Heller" written by Justice Antonin Scalia and shared by Chief Justice John G. Roberts Jr. and Justices Anthony M. Kennedy, Clarence Thomas and Samuel A. Alito Jr. found that the district's ban on handgun possession at home "violates the Second Amendment, as does its prohibition against rendering any lawful firearm in the home operable for the purpose of immediate self-defense."
The ruling raised concerns by dissenters like Breyer that gun laws nationwide would be thrown out. That has not happened yet.
Breyer, who just published "Making Our Democracy Work," a book about the role of the court in American life, outlined his judicial philosophy as one in which the court must take a pragmatic approach in which it "should regard the Constitution as containing unwavering values that must be applied flexibly to ever-changing circumstances."
Since the Founding Fathers could not foresee the impact of modern day communications and technology, the only option is to take the values of the Founding Fathers and apply them to today's challenges.
"The difficult job in open cases where there is no clear answer is to take those values in this document, which all Americans hold, which do not change, and to apply them to a world that is ever changing," Breyer said. "It's not a matter of policy. It is a matter of what those framers intended."
He suggested that those values and intentions mean that the Second Amendment allows for restrictions on the individual, including an all-out ban on handguns in the nation's capital.
"We're acting as judges. If we're going to decide everything on the basis of history -- by the way, what is the scope of the right to keep and bear arms? Machine guns? Torpedoes? Handguns?" he asked. "Are you a sportsman? Do you like to shoot pistols at targets? Well, get on the subway and go to Maryland. There is no problem, I don't think, for anyone who really wants to have a gun."
If you look at the values and the historical record, you will see that the Founding Fathers never intended guns to go unregulated, Supreme Court Justice Stephen Breyer contended Sunday.
Appearing on "Fox News Sunday," Breyer said history stands with the dissenters in the court's decision to overturn a Washington, D.C., handgun ban in the 2008 case "D.C. v. Heller."
Breyer wrote the dissent and was joined by Justices John Paul Stevens, David H. Souter and Ruth Bader Ginsburg. He said historians would side with him in the case because they have concluded that Founding Father James Madison was more worried that the Constitution may not be ratified than he was about granting individuals the right to bear arms.
Madison "was worried about opponents who would think Congress would call up state militias and nationalize them. 'That can't happen,' said Madison," said Breyer, adding that historians characterize Madison's priority as, "I've got to get this document ratified."
Therefore, Madison included the Second Amendment to appease the states, Breyer said.
"If you're interested in history, and in this one history was important, then I think you do have to pay attention to the story," Breyer said. "If that was his motive historically, the dissenters were right. And I think more of the historians were with us."
That being the case, and particularly since the Founding Fathers did not foresee how modern day would change individual behavior, government bodies can impose regulations on guns, Breyer concluded.
In July 2008, the concurring opinion in "D.C. v. Heller" written by Justice Antonin Scalia and shared by Chief Justice John G. Roberts Jr. and Justices Anthony M. Kennedy, Clarence Thomas and Samuel A. Alito Jr. found that the district's ban on handgun possession at home "violates the Second Amendment, as does its prohibition against rendering any lawful firearm in the home operable for the purpose of immediate self-defense."
The ruling raised concerns by dissenters like Breyer that gun laws nationwide would be thrown out. That has not happened yet.
Breyer, who just published "Making Our Democracy Work," a book about the role of the court in American life, outlined his judicial philosophy as one in which the court must take a pragmatic approach in which it "should regard the Constitution as containing unwavering values that must be applied flexibly to ever-changing circumstances."
Since the Founding Fathers could not foresee the impact of modern day communications and technology, the only option is to take the values of the Founding Fathers and apply them to today's challenges.
"The difficult job in open cases where there is no clear answer is to take those values in this document, which all Americans hold, which do not change, and to apply them to a world that is ever changing," Breyer said. "It's not a matter of policy. It is a matter of what those framers intended."
He suggested that those values and intentions mean that the Second Amendment allows for restrictions on the individual, including an all-out ban on handguns in the nation's capital.
"We're acting as judges. If we're going to decide everything on the basis of history -- by the way, what is the scope of the right to keep and bear arms? Machine guns? Torpedoes? Handguns?" he asked. "Are you a sportsman? Do you like to shoot pistols at targets? Well, get on the subway and go to Maryland. There is no problem, I don't think, for anyone who really wants to have a gun."
JUDGE BREYER is a very smart man IF YOU HAVE chance read his book(s) too!
Breyer: 'Very important' to hear Obama
Chief Justice John Roberts found last January's State of the Union address "very troubling." But his colleague Justice Stephen Breyer had no such qualms.
In an interview on "Fox News Sunday," Breyer said he intends on attending President Barack Obama's next address to Congress and those thereafter.
"I will go next year," Breyer said. "I have gone every year. I think it is very, very, very, important, very important for us to show up at that State of the Union - because people today, as you know, are more and more visual. I'd like them to read, but they are visual. And what they see in front of them at that State of the Union is the federal government, every part, the president, the Congress, the Cabinet, military, and I would like them to see the judges too, because federal judges are also part of that government."
Roberts has voiced his disdain for Obama's public admonishment of the Supreme Court for its Citizens United decision. Yet Breyer, who sided with the president on that case, said it's part of the judicial process.
"My job is to write opinions," Breyer said. "The job of 307 million Americans is to criticize those opinions. And what they say is up to them. And the words I write are carrying out my job under the law as best I see it. That's true of my colleagues too
Chief Justice John Roberts found last January's State of the Union address "very troubling." But his colleague Justice Stephen Breyer had no such qualms.
In an interview on "Fox News Sunday," Breyer said he intends on attending President Barack Obama's next address to Congress and those thereafter.
"I will go next year," Breyer said. "I have gone every year. I think it is very, very, very, important, very important for us to show up at that State of the Union - because people today, as you know, are more and more visual. I'd like them to read, but they are visual. And what they see in front of them at that State of the Union is the federal government, every part, the president, the Congress, the Cabinet, military, and I would like them to see the judges too, because federal judges are also part of that government."
Roberts has voiced his disdain for Obama's public admonishment of the Supreme Court for its Citizens United decision. Yet Breyer, who sided with the president on that case, said it's part of the judicial process.
"My job is to write opinions," Breyer said. "The job of 307 million Americans is to criticize those opinions. And what they say is up to them. And the words I write are carrying out my job under the law as best I see it. That's true of my colleagues too
TOM BROKAW, in a WashPost op-ed, on how President Obama and Leader Boehner can work together: "Make a joint appearance on the steps of the National Institutes of Health and say to the nation you're both leading: 'We have decided together that we can't ask the American people to make sacrifices in the year ahead unless we make some sacrifices of our own for the sake of our health, our families and the nation. We're quitting smoking and we ask others to join us in this critical step in restoring America's health.'"
Health Care and the Deficit
Here is a basic truth about the deficit: In the long run, it cannot be fixed, without reining in spending on Medicare and Medicaid.
This year, Medicare, Medicaid and a related children’s health insurance program will account for more than 20 percent of all federal spending — higher than Social Security or defense. Unless there are big changes, by 2035 federal health care spending — driven by rising medical costs and an aging population — is projected to account for almost 40 percent of the budget.
Two bipartisan commissions have issued recommendations to sharply reduce annual deficits, in part through bold changes — some sound, others dubious — in the way health care is paid for. Here are some of the issues that Congress will need to evaluate:
COST-SHIFTING The most disturbing element of both reports is that, in their efforts to show quick savings, they shift much of the burden from the federal budget to individuals or, in some cases, to states. That may make the federal deficit look better, but it is a shell game that produces no real reduction in the cost of health care.
Both commissions would save the government significant money by forcing all but the poorest Medicare beneficiaries to pay higher premiums and co-insurance.
The White House commission, headed by Erskine Bowles and Alan Simpson, proposes to wring nearly $400 billion from health care spending between 2012 and 2020, of which the biggest single element — $110 billion — would come from increased cost-sharing by Medicare beneficiaries. The second commission, an independent panel headed by Pete Domenici and Alice Rivlin, seeks to save $137 billion from Medicare cost-sharing.
Forcing beneficiaries to pay more is a reasonable way to get them to think twice before undergoing an expensive test that may not be critically necessary. But there is a big risk that people on modest incomes might forgo needed care. Beneficiaries might have to pay hundreds or even thousands of dollars more out of pocket.
It would make sense to require wealthier older people to pick up more of the cost of their own health care. But almost half of all Medicare beneficiaries live on low incomes — below $21,000 a year for an individual and $28,000 for a couple. Cost-shifting must not be allowed to undermine the health or financial security of elderly or disabled Americans of modest means.
END OF A TAX BREAK The Domenici-Rivlin panel, the more aggressive on health care, would also phase out the exclusion that exempts workers from paying taxes for employer-subsidized insurance, a benefit that also encourages excessive use of medical care. The long-term gain in tax revenue could be huge — more than $3 trillion between 2012 and 2030 and almost $10 trillion by 2040.
The health care reform law already limits the tax exclusion for the most costly employer plans, and eliminating it entirely sounds like a good idea in principle. But it would increase the financial burden on middle- and lower-income employees. That is why they would need to have access to competitive insurance exchanges that will open in 2014 and, depending on their need, federal subsidies. Such subsidies could amount to roughly half of the tax revenues gained by eliminating the exclusion, but the net reduction of the deficit would still be large.
VOUCHERS FOR MEDICARE The Domenici-Rivlin panel has a far-reaching proposal to give Medicare enrollees vouchers to buy coverage from Medicare or a competing private plan offered on a Medicare exchange. The voucher would increase in value at roughly half the likely rate of medical inflation. If the cost of coverage rose faster than that, the beneficiary would have to pay an extra premium to cover the difference or seek a cheaper plan.
The commission believes that competition on the exchanges will cause insurance plans to find ways to lower premiums. It also believes beneficiaries will restrain their own spending. The panel projects savings from premium support and its near-term cuts and cost-shifting could be huge — more than $2 trillion through 2030 and more than $7 trillion through 2040.
We see considerable merit in having traditional Medicare and private plans compete for business, but only if the competition is fair. There would have to be tight regulation to require plans to accept all comers, to set limits to cost-sharing.
SPENDING CAPS The health care reform law already seeks to cap the growth in Medicare spending per beneficiary to roughly half the rate it has been increasing in recent decades. It empowers a new board to find savings should the target be breached, subject to Congressional veto. The Bowles-Simpson commission would expand that approach by placing a cap on total federal spending for health care — not just Medicare and Medicaid but the subsidies on new exchanges and tax exemptions. But the commission punts on what to do should the growth cap be exceeded, as many experts deem likely.
FIXING THE SYSTEM The best way to lower health care spending is to reform the dysfunctional health care system whose costs seem unrelated to the quality of care delivered. The reform law makes a good start, sponsoring research to determine which treatments are effective and which are not, starting pilot projects to change the way care is delivered and paid for, and setting up new organizations to rush successful approaches into wide use in Medicare and ultimately the private sector.
Neither commission goes much further, probably because reformers had already scooped up most of the plausible approaches. The White House commission wants to speed up the adoption rate for reforms shown to work in pilot projects, an idea we heartily endorse.
Lawmakers from both parties need to take a serious look at the commission’s recommendations. So far, we have not heard much more than the usual posturing from either side of the aisle. Meanwhile the Republicans are still vowing to repeal the new health care reform law or block its implementation. That is yet one more reason why their claims to fiscal rectitude are so unbelievable.
NY TIMES EDITORIAL
This year, Medicare, Medicaid and a related children’s health insurance program will account for more than 20 percent of all federal spending — higher than Social Security or defense. Unless there are big changes, by 2035 federal health care spending — driven by rising medical costs and an aging population — is projected to account for almost 40 percent of the budget.
Two bipartisan commissions have issued recommendations to sharply reduce annual deficits, in part through bold changes — some sound, others dubious — in the way health care is paid for. Here are some of the issues that Congress will need to evaluate:
COST-SHIFTING The most disturbing element of both reports is that, in their efforts to show quick savings, they shift much of the burden from the federal budget to individuals or, in some cases, to states. That may make the federal deficit look better, but it is a shell game that produces no real reduction in the cost of health care.
Both commissions would save the government significant money by forcing all but the poorest Medicare beneficiaries to pay higher premiums and co-insurance.
The White House commission, headed by Erskine Bowles and Alan Simpson, proposes to wring nearly $400 billion from health care spending between 2012 and 2020, of which the biggest single element — $110 billion — would come from increased cost-sharing by Medicare beneficiaries. The second commission, an independent panel headed by Pete Domenici and Alice Rivlin, seeks to save $137 billion from Medicare cost-sharing.
Forcing beneficiaries to pay more is a reasonable way to get them to think twice before undergoing an expensive test that may not be critically necessary. But there is a big risk that people on modest incomes might forgo needed care. Beneficiaries might have to pay hundreds or even thousands of dollars more out of pocket.
It would make sense to require wealthier older people to pick up more of the cost of their own health care. But almost half of all Medicare beneficiaries live on low incomes — below $21,000 a year for an individual and $28,000 for a couple. Cost-shifting must not be allowed to undermine the health or financial security of elderly or disabled Americans of modest means.
END OF A TAX BREAK The Domenici-Rivlin panel, the more aggressive on health care, would also phase out the exclusion that exempts workers from paying taxes for employer-subsidized insurance, a benefit that also encourages excessive use of medical care. The long-term gain in tax revenue could be huge — more than $3 trillion between 2012 and 2030 and almost $10 trillion by 2040.
The health care reform law already limits the tax exclusion for the most costly employer plans, and eliminating it entirely sounds like a good idea in principle. But it would increase the financial burden on middle- and lower-income employees. That is why they would need to have access to competitive insurance exchanges that will open in 2014 and, depending on their need, federal subsidies. Such subsidies could amount to roughly half of the tax revenues gained by eliminating the exclusion, but the net reduction of the deficit would still be large.
VOUCHERS FOR MEDICARE The Domenici-Rivlin panel has a far-reaching proposal to give Medicare enrollees vouchers to buy coverage from Medicare or a competing private plan offered on a Medicare exchange. The voucher would increase in value at roughly half the likely rate of medical inflation. If the cost of coverage rose faster than that, the beneficiary would have to pay an extra premium to cover the difference or seek a cheaper plan.
The commission believes that competition on the exchanges will cause insurance plans to find ways to lower premiums. It also believes beneficiaries will restrain their own spending. The panel projects savings from premium support and its near-term cuts and cost-shifting could be huge — more than $2 trillion through 2030 and more than $7 trillion through 2040.
We see considerable merit in having traditional Medicare and private plans compete for business, but only if the competition is fair. There would have to be tight regulation to require plans to accept all comers, to set limits to cost-sharing.
SPENDING CAPS The health care reform law already seeks to cap the growth in Medicare spending per beneficiary to roughly half the rate it has been increasing in recent decades. It empowers a new board to find savings should the target be breached, subject to Congressional veto. The Bowles-Simpson commission would expand that approach by placing a cap on total federal spending for health care — not just Medicare and Medicaid but the subsidies on new exchanges and tax exemptions. But the commission punts on what to do should the growth cap be exceeded, as many experts deem likely.
FIXING THE SYSTEM The best way to lower health care spending is to reform the dysfunctional health care system whose costs seem unrelated to the quality of care delivered. The reform law makes a good start, sponsoring research to determine which treatments are effective and which are not, starting pilot projects to change the way care is delivered and paid for, and setting up new organizations to rush successful approaches into wide use in Medicare and ultimately the private sector.
Neither commission goes much further, probably because reformers had already scooped up most of the plausible approaches. The White House commission wants to speed up the adoption rate for reforms shown to work in pilot projects, an idea we heartily endorse.
Lawmakers from both parties need to take a serious look at the commission’s recommendations. So far, we have not heard much more than the usual posturing from either side of the aisle. Meanwhile the Republicans are still vowing to repeal the new health care reform law or block its implementation. That is yet one more reason why their claims to fiscal rectitude are so unbelievable.
NY TIMES EDITORIAL
AL GORE in a new light - BUT what could have been or NOT!?
Essay; The Coming Together — Nothing concedes like concession.
In his pre-comeback valedictory address, Al Gore (unlike another defeated candidate in 1962) did not bitterly lash out at his opponents.
On the contrary, Gore rose to the historic occasion like the patriot most of us expected him to be. ''I accept the finality of this outcome. . . . I offer my concession,'' he said gently, not flinching from the painful word. ''This belatedly broken impasse can point us all to a new common ground.''
Vice President Gore will, with equally good grace on Jan. 6, 2001, discharge his responsibility as president of the Senate to chair a joint session of the House and Senate to announce the official result of the vote of the Electoral College -- and thereby to proclaim the election of the man who defeated him.
That's what Vice President Richard Nixon good-naturedly did for John F. Kennedy in 1961 (R.N.: ''I detect a trend here'') and what Vice President Hubert Humphrey just could not abide doing for Nixon in 1969. Tradition calls for the electoral result to be announced state by state, and the cameras will zoom in to a close-up of Gore's face when it comes to Florida; a medium sigh followed by discreet eye-rolling would be well received.
That, following a cordial meeting of the former political combatants, should help along the process of public acceptance of George W. Bush, the non-loser who is president-elect.
For the next few days, until the naming of the cabinet dominates the news, we can expect much learned hand-wringing about the ''wound'' the Supreme Court inflicted on itself by daring to hear, and to rule on, the hottest political case imaginable -- and under record time pressure. Now the justices know what it's like to write against a deadline.
The whole court did itself proud. The close majority opinion that denied an unconstitutional recount; the 7-to-2 agreement that the Florida Supreme Court, in failing to provide statewide standards for recounts, had denied ''equal protection'' to all voters; the vigorous dissents of the liberal quartet that partly concurred with one another -- all these were the products of fine legal minds thinking fast, unafraid of complexity, unsullied by rancor. (Justice John Paul Stevens was a tad intemperate, but we geezers are permitted some passion.)
The central complaint of the losing side is that the nation's highest court stopped the counting and then said time had run out. But it was the Florida Supreme Court that shortened the contest period from four weeks to two, and reaffirmed, in its slow-walking response to the U.S. Supreme Court's urgent questioning, the state election law's inexorable Dec. 12 deadline.
Though the Rehnquist court can expect much law-school derision for its activism in enforcing judicial restraint, it can lick its ''wound'' by considering how much tension it saved the Republic.
Were it not for the court's willingness to take the case and the heat, internecine mud-wrestling would have gone on for at least another month. If Gore had edged ahead in the counting of ''undervotes,'' Bush would have contested unexamined ''overvotes.'' If the Florida Supremes had named a Gore slate of electors, the Florida Legislature would have named its own; some electors in other states may then have been seduced into faithlessness; ultimately, the ever-more-angry dispute would have wound up in Congress.
At the end, with the G.O.P. in control of the clear majority of states, we would have ended up exactly where we are today: with President-elect Bush. Along the way, many now-reasonable opponents would have become implacable enemies, and the electorate would have been not just evenly divided but angrily polarized. The Supreme Court, at some cost to its own serenity but not to its historic reputation, saved us from that.
After the court acted, Gore did the right thing within 24 hours. Only then did the man Gore called ''president-elect'' play his part in the necessary coming-together:
''I hope the long wait of the last five weeks,'' Bush said, ''will heighten a desire to move beyond the bitterness and partisanship of the recent past.'' He reiterated Gore's theme of a ''common ground,'' and drove it home with: ''I was not elected to serve one party, but to serve one nation.''
WILLIAM SAFIRE
In his pre-comeback valedictory address, Al Gore (unlike another defeated candidate in 1962) did not bitterly lash out at his opponents.
On the contrary, Gore rose to the historic occasion like the patriot most of us expected him to be. ''I accept the finality of this outcome. . . . I offer my concession,'' he said gently, not flinching from the painful word. ''This belatedly broken impasse can point us all to a new common ground.''
Vice President Gore will, with equally good grace on Jan. 6, 2001, discharge his responsibility as president of the Senate to chair a joint session of the House and Senate to announce the official result of the vote of the Electoral College -- and thereby to proclaim the election of the man who defeated him.
That's what Vice President Richard Nixon good-naturedly did for John F. Kennedy in 1961 (R.N.: ''I detect a trend here'') and what Vice President Hubert Humphrey just could not abide doing for Nixon in 1969. Tradition calls for the electoral result to be announced state by state, and the cameras will zoom in to a close-up of Gore's face when it comes to Florida; a medium sigh followed by discreet eye-rolling would be well received.
That, following a cordial meeting of the former political combatants, should help along the process of public acceptance of George W. Bush, the non-loser who is president-elect.
For the next few days, until the naming of the cabinet dominates the news, we can expect much learned hand-wringing about the ''wound'' the Supreme Court inflicted on itself by daring to hear, and to rule on, the hottest political case imaginable -- and under record time pressure. Now the justices know what it's like to write against a deadline.
The whole court did itself proud. The close majority opinion that denied an unconstitutional recount; the 7-to-2 agreement that the Florida Supreme Court, in failing to provide statewide standards for recounts, had denied ''equal protection'' to all voters; the vigorous dissents of the liberal quartet that partly concurred with one another -- all these were the products of fine legal minds thinking fast, unafraid of complexity, unsullied by rancor. (Justice John Paul Stevens was a tad intemperate, but we geezers are permitted some passion.)
The central complaint of the losing side is that the nation's highest court stopped the counting and then said time had run out. But it was the Florida Supreme Court that shortened the contest period from four weeks to two, and reaffirmed, in its slow-walking response to the U.S. Supreme Court's urgent questioning, the state election law's inexorable Dec. 12 deadline.
Though the Rehnquist court can expect much law-school derision for its activism in enforcing judicial restraint, it can lick its ''wound'' by considering how much tension it saved the Republic.
Were it not for the court's willingness to take the case and the heat, internecine mud-wrestling would have gone on for at least another month. If Gore had edged ahead in the counting of ''undervotes,'' Bush would have contested unexamined ''overvotes.'' If the Florida Supremes had named a Gore slate of electors, the Florida Legislature would have named its own; some electors in other states may then have been seduced into faithlessness; ultimately, the ever-more-angry dispute would have wound up in Congress.
At the end, with the G.O.P. in control of the clear majority of states, we would have ended up exactly where we are today: with President-elect Bush. Along the way, many now-reasonable opponents would have become implacable enemies, and the electorate would have been not just evenly divided but angrily polarized. The Supreme Court, at some cost to its own serenity but not to its historic reputation, saved us from that.
After the court acted, Gore did the right thing within 24 hours. Only then did the man Gore called ''president-elect'' play his part in the necessary coming-together:
''I hope the long wait of the last five weeks,'' Bush said, ''will heighten a desire to move beyond the bitterness and partisanship of the recent past.'' He reiterated Gore's theme of a ''common ground,'' and drove it home with: ''I was not elected to serve one party, but to serve one nation.''
WILLIAM SAFIRE
Saturday, December 11, 2010
Elizabeth Edwards: "A Lighthouse to All of Us" (a classic example of a real woman with class but unfornately married below herself!)
Hundreds Remember With Affection the Activist and Political Wife Who Died After Long Battle With Cancer at Age 61
Saying Goodbye to Elizabeth Edwards
Elizabeth Edwards: 1949-2010
Estranged wife of John Edwards dies at 61 after a six-year battle with cancer
John Not a Speaker at Elizabeth Edwards Funeral
(AP) Hundreds of family and friends gathered Saturday to honor the life of Elizabeth Edwards, who has been praised for her strength amid a series of life tragedies that included the death of a son, a betrayal by her husband and a battle with cancer that eventually led to her death.
The funeral was held at Edenton Street United Methodist, a Raleigh church that Edwards turned to after her 16-year-old son Wade died in a car crash in 1996. She was to be buried later in the day alongside her son during a private ceremony.
Speakers recalled Edwards as a woman filled with energy, intellect and humor. They joked they had trouble coming up with what to say without the woman who used to leave notes of advice for those close to her.
"There aren't words that are good enough," said daughter Cate Edwards, whose eulogy contained a passage from a letter her mother spent years preparing to leave to her children after she was gone.
"I've loved you in the best ways I've known how," the letter said. "All I ever really needed was you, your love, your presence, to make my life complete."
John Edwards, her estranged husband, did not speak. The couple had four children together, including 12-year-old Emma Claire and 10-year-old Jack.
John Edwards "Grieving Terribly" for Elizabeth
Anti-Gay Protesters at Edwards Funeral
Their oldest daughter, 28-year-old Cate, also talked of how her mother comforted those around her as she lay dying - at one point barely able to speak as she held her daughter and John's hands, looking back and forth to each, repeating, "I'm OK. I'm OK."
"She was way more worried about us than we were about her," Cate Edwards said.
She talked of her mother's strength and grace and also of her witty advice about everything from clothing (there are always fewer regrets wearing solids than patterns) to marriage (don't settle for the first boy you ever meet).
"She's been a lighthouse to all of us - a point of guidance when we all feel lost," she said.
The memorial brought several political figures, including Sen. John Kerry, who led the Democratic presidential ticket in 2004 that included John Edwards, and North Carolina Gov. Beverly Perdue.
Two of Elizabeth Edwards' longtime friends, Hargrave McElroy and Glenn Bergenfield, also gave eulogies.
McElroy spoke admiringly of the fiery woman who first became a close friend as the couple raised their young children, telling stories of Edwards' expertise at any pursuit that required intellect - from board games to sports trivia. She said Edwards was always an optimist.
"She knew who she was. She never held back. She was without pretense," McElroy said.
Bergenfield described a woman he first met in law school who challenged her professors with a vibrant mind and who possessed "big world, head-turning, walk-into-the-poll gorgeous" looks. He related anecdotes about how strong she was, but also how she was down-to-earth she was, seeming to care for each stranger she met, disarming campaign operatives with plain language or crawling under a dorm room bed to find clothing Cate had discarded.
"Nothing that she said publicly, as a mother, as an author or as a friend - none of it fed or was in any way fueled by ego," he said.
Bergenfield described Edwards as a close friend to him and his family - giving his children thoughtful advice and teaching people around her to "live like it's important."
One of the pallbearers, Tyler Highsmith, was in the car Wade Edwards was driving when he died. He and three other pallbearers - Michael Lewis, Ellis Roberts and Charles Scarantino - were pallbearers in Wade Edwards' funeral.
Jennifer Palmieri, who was a senior adviser during John Edwards' presidential campaigns, said the funeral was open to the public because Elizabeth Edwards always insisted on open campaign events - much to the consternation of staff who wanted to control access. She never wanted tickets issued, even free ones.
Among the people who gathered on a nearby street hours before the funeral was Barbara Fields, a 65-year-old Raleigh resident who never knew Edwards personally but was impressed by how she handled adversity.
Fields, a 10-year breast cancer survivor who wore a pink scarf with breast cancer logos, said she found comfort in books and speeches by Edwards about the fear and sleepless nights that come with fighting the illness.
"She just carried herself with a quiet dignity," Fields said.
Elizabeth Edwards was first diagnosed with cancer in 2004, a day after the Kerry-Edwards ticket lost to George W. Bush in that year's presidential election. Doctors declared her cancer-free after grueling treatments, but the disease returned in an incurable form in 2007. She died Tuesday.
Her last years were tumultuous ones, made difficult by her husband's affair and eventual admission that he'd fathered a child with the mistress. John and Elizabeth Edwards separated about a year ago.
Saying Goodbye to Elizabeth Edwards
Elizabeth Edwards: 1949-2010
Estranged wife of John Edwards dies at 61 after a six-year battle with cancer
John Not a Speaker at Elizabeth Edwards Funeral
(AP) Hundreds of family and friends gathered Saturday to honor the life of Elizabeth Edwards, who has been praised for her strength amid a series of life tragedies that included the death of a son, a betrayal by her husband and a battle with cancer that eventually led to her death.
The funeral was held at Edenton Street United Methodist, a Raleigh church that Edwards turned to after her 16-year-old son Wade died in a car crash in 1996. She was to be buried later in the day alongside her son during a private ceremony.
Speakers recalled Edwards as a woman filled with energy, intellect and humor. They joked they had trouble coming up with what to say without the woman who used to leave notes of advice for those close to her.
"There aren't words that are good enough," said daughter Cate Edwards, whose eulogy contained a passage from a letter her mother spent years preparing to leave to her children after she was gone.
"I've loved you in the best ways I've known how," the letter said. "All I ever really needed was you, your love, your presence, to make my life complete."
John Edwards, her estranged husband, did not speak. The couple had four children together, including 12-year-old Emma Claire and 10-year-old Jack.
John Edwards "Grieving Terribly" for Elizabeth
Anti-Gay Protesters at Edwards Funeral
Their oldest daughter, 28-year-old Cate, also talked of how her mother comforted those around her as she lay dying - at one point barely able to speak as she held her daughter and John's hands, looking back and forth to each, repeating, "I'm OK. I'm OK."
"She was way more worried about us than we were about her," Cate Edwards said.
She talked of her mother's strength and grace and also of her witty advice about everything from clothing (there are always fewer regrets wearing solids than patterns) to marriage (don't settle for the first boy you ever meet).
"She's been a lighthouse to all of us - a point of guidance when we all feel lost," she said.
The memorial brought several political figures, including Sen. John Kerry, who led the Democratic presidential ticket in 2004 that included John Edwards, and North Carolina Gov. Beverly Perdue.
Two of Elizabeth Edwards' longtime friends, Hargrave McElroy and Glenn Bergenfield, also gave eulogies.
McElroy spoke admiringly of the fiery woman who first became a close friend as the couple raised their young children, telling stories of Edwards' expertise at any pursuit that required intellect - from board games to sports trivia. She said Edwards was always an optimist.
"She knew who she was. She never held back. She was without pretense," McElroy said.
Bergenfield described a woman he first met in law school who challenged her professors with a vibrant mind and who possessed "big world, head-turning, walk-into-the-poll gorgeous" looks. He related anecdotes about how strong she was, but also how she was down-to-earth she was, seeming to care for each stranger she met, disarming campaign operatives with plain language or crawling under a dorm room bed to find clothing Cate had discarded.
"Nothing that she said publicly, as a mother, as an author or as a friend - none of it fed or was in any way fueled by ego," he said.
Bergenfield described Edwards as a close friend to him and his family - giving his children thoughtful advice and teaching people around her to "live like it's important."
One of the pallbearers, Tyler Highsmith, was in the car Wade Edwards was driving when he died. He and three other pallbearers - Michael Lewis, Ellis Roberts and Charles Scarantino - were pallbearers in Wade Edwards' funeral.
Jennifer Palmieri, who was a senior adviser during John Edwards' presidential campaigns, said the funeral was open to the public because Elizabeth Edwards always insisted on open campaign events - much to the consternation of staff who wanted to control access. She never wanted tickets issued, even free ones.
Among the people who gathered on a nearby street hours before the funeral was Barbara Fields, a 65-year-old Raleigh resident who never knew Edwards personally but was impressed by how she handled adversity.
Fields, a 10-year breast cancer survivor who wore a pink scarf with breast cancer logos, said she found comfort in books and speeches by Edwards about the fear and sleepless nights that come with fighting the illness.
"She just carried herself with a quiet dignity," Fields said.
Elizabeth Edwards was first diagnosed with cancer in 2004, a day after the Kerry-Edwards ticket lost to George W. Bush in that year's presidential election. Doctors declared her cancer-free after grueling treatments, but the disease returned in an incurable form in 2007. She died Tuesday.
Her last years were tumultuous ones, made difficult by her husband's affair and eventual admission that he'd fathered a child with the mistress. John and Elizabeth Edwards separated about a year ago.
Is Sexual Fidelity the Most Important Part of a Relationship?
Thoughts on Non-monogamy - Is Sexual Fidelity the Most Important Part of a Relationship?
Recently a new sex partner asked for my advice on how to deal with three women he was “seeing,” each of whom was interested in having a monogamous relationship with him. Being as how we had just had “no strings attached” sex, I asked him if he was really able to handle truly being monogamous. His reply was (as I expected) a sheepish “No.”
It came out that he was more interested in one of the women than he was in the other two, but that she also had commitment issues. So I suggested that he consider an open relationship, one in which he did all the “girlfriend” things with this woman, but which allowed for both of them to still have the option of sex with other people—provided that there was no emotional involvement.
This was an apparently novel idea for him, and he liked it. I explained that they would need to negotiate the ground rules of their relationship (for example, he was okay with her having sex with other men as long as she didn’t talk about it) and they would have to keep the lines of communication open. After he left, I wondered to myself: If we didn’t have the expectation that our “committed” partners would be able to fulfill all of our sexual needs, could we be free to simply enjoy the closeness and commitment of a relationship based on emotional instead of sexual fidelity?
For me, the most important part of a relationship is the emotional connection you have with your partner. You trust them, you talk openly with them, they know your quirks and flaws and still love you for them. When you have this connection, it usually makes for better sex. But there’s something to be said about having someone you can give your heart to and still remain free to engage in other sexual encounters. I’m talking about emotional monogamy. Sex is a pleasurable bonus in an emotionally monogamous relationship, and we can extricate sex from the relationship equation if we’re willing to accept that one can love someone deeply and still desire and pursue other sex partners, without loving the primary partner any less.
Some people take the next step and choose to practice polyamory—multiple full-fledged emotional and sexual relationships. Books like The Ethical Slut offer a guide on how to construct working polyamorous relationships, touching on topics such as having a primary partner with whom you have unprotected sex and “satellite” partners with whom you use protection—but in ANY type of non-monogamous relationship safer sex is extremely important. This type of relationship arrangement is not for those interested in emotional fidelity, because, by definition, polyamory is participation in multiple LOVING relationships. Meaning, you’re sharing your partner’s affections—so if you’re the jealous type, this probably won’t work for you. But many people can and do thrive in a polyamorous relationship. Me, I need that emotional exclusivity. To each her own.
Lately, some men have been approaching me looking for another, more familiar type of arrangement, optimistically called, “friends with benefits.” This is about one step up from “fuck buddy,” in my opinion, and will usually either end up with you in an awkward, forced relationship, or with you minus a friendship. Remaining “just friends” while being involved sexually takes a level of emotional detachment that many women (and men, actually) aren’t able to attain. As you become better friends, it’s natural that you become more involved with them. Add sex to the equation, and the fact that when you orgasm with a partner a hormone called oxytocin is released causing the creation of strong attachment, and you’ve got drama if your partner doesn’t get the same dosage. If you can pull this off, more power to you—but if you’re the type that becomes easily love-struck, I’d suggest staying clear of this arrangement.
Each of these non-monogamous relationship configurations—and I’m only touching on a few of the multiple possibilities—have their pros and cons. It is important to think carefully about what you need in order to feel comfortable. Do you want to “come home” to one person but have sex with many people, as in, an emotionally monogamous yet sexually open relationship? Can you handle knowing that your partner both loves and sleeps with more women than just you, as in, a polyamorous relationship? Do YOU want to love and sleep with more partners than just the one? Can you rein in your attachment and just be friends who fuck? Really, it’s up to you where the line is drawn.
But in any non-monogamous relationship, just as in monogamous relationships, communication is of the utmost importance. The minute that communication breaks down when one partner expects something that the other has no idea they want, things fall apart. I recently experienced a situation in which one of my sex partners had assumed that they were the only person I was having sex with. We had never talked about having any type of monogamous relationship, we had just hooked up and had fun. But because he wanted something from me that I didn’t know he desired, there was a bit of “reevaluation of the situation” on his part. Our “arrangement” didn’t end, but his ego may have taken a bruising.
Practicing non-monogamy doesn’t make you a “ho” or a “slut.” I know we are wary of the stereotype of the hypersexualized Black woman. I’m not suggesting that you pull on a pair of booty shorts and go hit up all the potential sex partners you see. What I am suggesting is that we shed the notion that there’s only one way to be in a relationship with someone, and embrace the spectrum of relationship configurations that include flavors of non-monogamy.
You might find ways to fulfill needs you didn’t even know that you had.
Tasha Fierce LAUNCH Magazine
Recently a new sex partner asked for my advice on how to deal with three women he was “seeing,” each of whom was interested in having a monogamous relationship with him. Being as how we had just had “no strings attached” sex, I asked him if he was really able to handle truly being monogamous. His reply was (as I expected) a sheepish “No.”
It came out that he was more interested in one of the women than he was in the other two, but that she also had commitment issues. So I suggested that he consider an open relationship, one in which he did all the “girlfriend” things with this woman, but which allowed for both of them to still have the option of sex with other people—provided that there was no emotional involvement.
This was an apparently novel idea for him, and he liked it. I explained that they would need to negotiate the ground rules of their relationship (for example, he was okay with her having sex with other men as long as she didn’t talk about it) and they would have to keep the lines of communication open. After he left, I wondered to myself: If we didn’t have the expectation that our “committed” partners would be able to fulfill all of our sexual needs, could we be free to simply enjoy the closeness and commitment of a relationship based on emotional instead of sexual fidelity?
For me, the most important part of a relationship is the emotional connection you have with your partner. You trust them, you talk openly with them, they know your quirks and flaws and still love you for them. When you have this connection, it usually makes for better sex. But there’s something to be said about having someone you can give your heart to and still remain free to engage in other sexual encounters. I’m talking about emotional monogamy. Sex is a pleasurable bonus in an emotionally monogamous relationship, and we can extricate sex from the relationship equation if we’re willing to accept that one can love someone deeply and still desire and pursue other sex partners, without loving the primary partner any less.
Some people take the next step and choose to practice polyamory—multiple full-fledged emotional and sexual relationships. Books like The Ethical Slut offer a guide on how to construct working polyamorous relationships, touching on topics such as having a primary partner with whom you have unprotected sex and “satellite” partners with whom you use protection—but in ANY type of non-monogamous relationship safer sex is extremely important. This type of relationship arrangement is not for those interested in emotional fidelity, because, by definition, polyamory is participation in multiple LOVING relationships. Meaning, you’re sharing your partner’s affections—so if you’re the jealous type, this probably won’t work for you. But many people can and do thrive in a polyamorous relationship. Me, I need that emotional exclusivity. To each her own.
Lately, some men have been approaching me looking for another, more familiar type of arrangement, optimistically called, “friends with benefits.” This is about one step up from “fuck buddy,” in my opinion, and will usually either end up with you in an awkward, forced relationship, or with you minus a friendship. Remaining “just friends” while being involved sexually takes a level of emotional detachment that many women (and men, actually) aren’t able to attain. As you become better friends, it’s natural that you become more involved with them. Add sex to the equation, and the fact that when you orgasm with a partner a hormone called oxytocin is released causing the creation of strong attachment, and you’ve got drama if your partner doesn’t get the same dosage. If you can pull this off, more power to you—but if you’re the type that becomes easily love-struck, I’d suggest staying clear of this arrangement.
Each of these non-monogamous relationship configurations—and I’m only touching on a few of the multiple possibilities—have their pros and cons. It is important to think carefully about what you need in order to feel comfortable. Do you want to “come home” to one person but have sex with many people, as in, an emotionally monogamous yet sexually open relationship? Can you handle knowing that your partner both loves and sleeps with more women than just you, as in, a polyamorous relationship? Do YOU want to love and sleep with more partners than just the one? Can you rein in your attachment and just be friends who fuck? Really, it’s up to you where the line is drawn.
But in any non-monogamous relationship, just as in monogamous relationships, communication is of the utmost importance. The minute that communication breaks down when one partner expects something that the other has no idea they want, things fall apart. I recently experienced a situation in which one of my sex partners had assumed that they were the only person I was having sex with. We had never talked about having any type of monogamous relationship, we had just hooked up and had fun. But because he wanted something from me that I didn’t know he desired, there was a bit of “reevaluation of the situation” on his part. Our “arrangement” didn’t end, but his ego may have taken a bruising.
Practicing non-monogamy doesn’t make you a “ho” or a “slut.” I know we are wary of the stereotype of the hypersexualized Black woman. I’m not suggesting that you pull on a pair of booty shorts and go hit up all the potential sex partners you see. What I am suggesting is that we shed the notion that there’s only one way to be in a relationship with someone, and embrace the spectrum of relationship configurations that include flavors of non-monogamy.
You might find ways to fulfill needs you didn’t even know that you had.
Tasha Fierce LAUNCH Magazine
Body Fell From Plane ( OOOOPS!)
BOSTON — A North Carolina teenager whose body was found in a Boston suburb last month had most likely stowed away inside a plane’s wheel well and fallen as it lowered its landing gear, the authorities said Friday.
The remains of the youth, Delvonte Tisdale, 16, were found in a quiet neighborhood in Milton, Mass., on Nov. 15, below a flight path to Logan Airport.
“It appears more likely than not that Mr. Tisdale was able to breach airport security and hide in the wheel well of a commercial jet airliner without being detected by airport security,” William R. Keating, Norfolk County district attorney, said at a news conference on Friday afternoon.
Mr. Keating said he had alerted federal authorities and the airport in Charlotte, N.C., where the teenager is believed to have gotten on the flight, about the events. While the case is a sad one, Mr. Keating said, it also underscores fears that someone with malicious intent could do the same thing.
“It’s a terrible tragedy what happened to this young man, but if that was someone with a different motive,” he said, “if that was a terrorist that could have been a bomb that was planted, undetected. This is very serious.”
Mr. Keating said the authorities had searched two airplanes that left Charlotte for Boston on Nov. 15, and found handprints in the left wheel well of a Boeing 737 that was scheduled to leave Charlotte Douglas International Airport at 7 p.m. that day.
“As they looked at the grease, they saw what I describe as lateral impressions that showed there was someone in there. There was a handprint in an area where it ordinarily wouldn’t be,” Mr. Keating said.
“I don’t pretend to tell you how he did it,” Mr. Keating said, noting that Delvonte was an Air Force R.O.T.C. student.
Clothing that matched a description that Delvonte’s family had given the authorities was found in Milton along the flight path, Mr. Keating said, and a plastic card — the type one uses to get into a hotel room — was found shattered.
“The altitudes were very high, and it gets very cold,” Mr. Keating said. “That card was shattered into such tiny pieces that it was consistent with something that had been frozen and shattered.”
The authorities initially believed that Delvonte had been murdered, and impounded two cars they thought to be suspicious. But in recent weeks, officials began investigating the possibility that the teenager had stowed away on an airplane.
“This was something that sounded quite remote, that someone could breach security aboard a commercial jet,” Mr. Keating said. “Again we look at every possibility.”
The authorities were at first flummoxed as to how the teenager had made it from North Carolina to Massachusetts so quickly. Delvonte was last seen around 1 a.m. Nov. 15 in Charlotte, and his body was found less than 24 hours later in Milton. A neighbor in the Milton neighborhood reported hearing a loud thump outside around 9 p.m.; the authorities said the plane landed minutes later.
Federal and state authorities continue to investigate the case, Mr. Keating said.
“I suspect,” he said, “that there will be a lot of scrutiny into this.”
The remains of the youth, Delvonte Tisdale, 16, were found in a quiet neighborhood in Milton, Mass., on Nov. 15, below a flight path to Logan Airport.
“It appears more likely than not that Mr. Tisdale was able to breach airport security and hide in the wheel well of a commercial jet airliner without being detected by airport security,” William R. Keating, Norfolk County district attorney, said at a news conference on Friday afternoon.
Mr. Keating said he had alerted federal authorities and the airport in Charlotte, N.C., where the teenager is believed to have gotten on the flight, about the events. While the case is a sad one, Mr. Keating said, it also underscores fears that someone with malicious intent could do the same thing.
“It’s a terrible tragedy what happened to this young man, but if that was someone with a different motive,” he said, “if that was a terrorist that could have been a bomb that was planted, undetected. This is very serious.”
Mr. Keating said the authorities had searched two airplanes that left Charlotte for Boston on Nov. 15, and found handprints in the left wheel well of a Boeing 737 that was scheduled to leave Charlotte Douglas International Airport at 7 p.m. that day.
“As they looked at the grease, they saw what I describe as lateral impressions that showed there was someone in there. There was a handprint in an area where it ordinarily wouldn’t be,” Mr. Keating said.
“I don’t pretend to tell you how he did it,” Mr. Keating said, noting that Delvonte was an Air Force R.O.T.C. student.
Clothing that matched a description that Delvonte’s family had given the authorities was found in Milton along the flight path, Mr. Keating said, and a plastic card — the type one uses to get into a hotel room — was found shattered.
“The altitudes were very high, and it gets very cold,” Mr. Keating said. “That card was shattered into such tiny pieces that it was consistent with something that had been frozen and shattered.”
The authorities initially believed that Delvonte had been murdered, and impounded two cars they thought to be suspicious. But in recent weeks, officials began investigating the possibility that the teenager had stowed away on an airplane.
“This was something that sounded quite remote, that someone could breach security aboard a commercial jet,” Mr. Keating said. “Again we look at every possibility.”
The authorities were at first flummoxed as to how the teenager had made it from North Carolina to Massachusetts so quickly. Delvonte was last seen around 1 a.m. Nov. 15 in Charlotte, and his body was found less than 24 hours later in Milton. A neighbor in the Milton neighborhood reported hearing a loud thump outside around 9 p.m.; the authorities said the plane landed minutes later.
Federal and state authorities continue to investigate the case, Mr. Keating said.
“I suspect,” he said, “that there will be a lot of scrutiny into this.”
In Tapes, Nixon Rails About Jews and Blacks (now we know HE WAS A CROOK & A RACIST!)
YORBA LINDA, Calif. — Richard M. Nixon made disparaging remarks about Jews, blacks, Italian-Americans and Irish-Americans in a series of extended conversations with top aides and his personal secretary, recorded in the Oval Office 16 months before he resigned as president.
The remarks were contained in 265 hours of recordings, captured by the secret taping system Nixon had installed in the White House and released this week by the Nixon Presidential Library and Museum.
While previous recordings have detailed Nixon’s animosity toward Jews, including those who served in his administration like Henry A. Kissinger, his national security adviser, these tapes suggest an added layer of complexity to Nixon’s feeling. He and his aides seem to make a distinction between Israeli Jews, whom Nixon admired, and American Jews.
In a conversation Feb. 13, 1973, with Charles W. Colson, a senior adviser who had just told Nixon that he had always had “a little prejudice,” Nixon said he was not prejudiced but continued: “I’ve just recognized that, you know, all people have certain traits.”
“The Jews have certain traits,” he said. “The Irish have certain — for example, the Irish can’t drink. What you always have to remember with the Irish is they get mean. Virtually every Irish I’ve known gets mean when he drinks. Particularly the real Irish.”
Nixon continued: “The Italians, of course, those people course don’t have their heads screwed on tight. They are wonderful people, but,” and his voice trailed off.
A moment later, Nixon returned to Jews: “The Jews are just a very aggressive and abrasive and obnoxious personality.”
At another point, in a long and wandering conversation with Rose Mary Woods, his personal secretary, that veered from whom to invite to a state dinner to whether Ms. Woods should get her hair done, Nixon offered sharp skepticism at the views of William P. Rogers, his secretary of state, about the future of black Africans.
“Bill Rogers has got — to his credit it’s a decent feeling — but somewhat sort of a blind spot on the black thing because he’s been in New York,” Nixon said. “He says well, ‘They are coming along, and that after all they are going to strengthen our country in the end because they are strong physically and some of them are smart.’ So forth and so on.
“My own view is I think he’s right if you’re talking in terms of 500 years,” he said. “I think it’s wrong if you’re talking in terms of 50 years. What has to happen is they have be, frankly, inbred. And, you just, that’s the only thing that’s going to do it, Rose.”
These tapes, made in February and March 1973, reflect a critical period in Nixon’s presidency — the final months before it was “devoured by Watergate,” said Timothy Naftali, the executive director of the Nixon Library.
Mr. Naftali said that there were now only 400 hours of tapes left to released, and that those would cover the final months before the tape system was shut down in July 1973 after Alexander Butterfield, who was a deputy assistant to Nixon, confirmed its existence to the Watergate committee.
Mr. Naftali said he intended to have those tapes — actually, given changing technologies since Nixon’s time, CDs, and available for listening online at the library’s Web site — released by 2012.
An indication of Nixon’s complex relationship with Jews came the afternoon Golda Meir, the Israeli prime minister, came to visit on March 1, 1973. The tapes capture Meir offering warm and effusive thanks to Nixon for the way he had treated her and Israel.
But moments after she left, Nixon and Mr. Kissinger were brutally dismissive in response to requests that the United States press the Soviet Union to permit Jews to emigrate and escape persecution there.
“The emigration of Jews from the Soviet Union is not an objective of American foreign policy,” Mr. Kissinger said. “And if they put Jews into gas chambers in the Soviet Union, it is not an American concern. Maybe a humanitarian concern.”
“I know,” Nixon responded. “We can’t blow up the world because of it.”
In his discussion with Ms. Woods, Nixon laid down clear rules about who would be permitted to attend the state dinner for Meir — he called it “the Jewish dinner” — after learning that the White House was being besieged with requests to attend.
“I don’t want any Jew at that dinner who didn’t support us in that campaign,” he said. “Is that clear? No Jew who did not support us.”
Nixon listed many of his top Jewish advisers — among them, Mr. Kissinger and William Safire, who went on to become a columnist at The New York Times — and argued that they shared a common trait, of needing to compensate for an inferiority complex.
“What it is, is it’s the insecurity,” he said. “It’s the latent insecurity. Most Jewish people are insecure. And that’s why they have to prove things.”
Nixon also strongly hinted that his reluctance to even consider amnesty for young Americans who went to Canada to avoid being drafted during the Vietnam War was because, he told Mr. Colson, so many of them were Jewish.
“I didn’t notice many Jewish names coming back from Vietnam on any of those lists; I don’t know how the hell they avoid it,” he said, adding: “If you look at the Canadian-Swedish contingent, they were very disproportionately Jewish. The deserters.”
The remarks were contained in 265 hours of recordings, captured by the secret taping system Nixon had installed in the White House and released this week by the Nixon Presidential Library and Museum.
While previous recordings have detailed Nixon’s animosity toward Jews, including those who served in his administration like Henry A. Kissinger, his national security adviser, these tapes suggest an added layer of complexity to Nixon’s feeling. He and his aides seem to make a distinction between Israeli Jews, whom Nixon admired, and American Jews.
In a conversation Feb. 13, 1973, with Charles W. Colson, a senior adviser who had just told Nixon that he had always had “a little prejudice,” Nixon said he was not prejudiced but continued: “I’ve just recognized that, you know, all people have certain traits.”
“The Jews have certain traits,” he said. “The Irish have certain — for example, the Irish can’t drink. What you always have to remember with the Irish is they get mean. Virtually every Irish I’ve known gets mean when he drinks. Particularly the real Irish.”
Nixon continued: “The Italians, of course, those people course don’t have their heads screwed on tight. They are wonderful people, but,” and his voice trailed off.
A moment later, Nixon returned to Jews: “The Jews are just a very aggressive and abrasive and obnoxious personality.”
At another point, in a long and wandering conversation with Rose Mary Woods, his personal secretary, that veered from whom to invite to a state dinner to whether Ms. Woods should get her hair done, Nixon offered sharp skepticism at the views of William P. Rogers, his secretary of state, about the future of black Africans.
“Bill Rogers has got — to his credit it’s a decent feeling — but somewhat sort of a blind spot on the black thing because he’s been in New York,” Nixon said. “He says well, ‘They are coming along, and that after all they are going to strengthen our country in the end because they are strong physically and some of them are smart.’ So forth and so on.
“My own view is I think he’s right if you’re talking in terms of 500 years,” he said. “I think it’s wrong if you’re talking in terms of 50 years. What has to happen is they have be, frankly, inbred. And, you just, that’s the only thing that’s going to do it, Rose.”
These tapes, made in February and March 1973, reflect a critical period in Nixon’s presidency — the final months before it was “devoured by Watergate,” said Timothy Naftali, the executive director of the Nixon Library.
Mr. Naftali said that there were now only 400 hours of tapes left to released, and that those would cover the final months before the tape system was shut down in July 1973 after Alexander Butterfield, who was a deputy assistant to Nixon, confirmed its existence to the Watergate committee.
Mr. Naftali said he intended to have those tapes — actually, given changing technologies since Nixon’s time, CDs, and available for listening online at the library’s Web site — released by 2012.
An indication of Nixon’s complex relationship with Jews came the afternoon Golda Meir, the Israeli prime minister, came to visit on March 1, 1973. The tapes capture Meir offering warm and effusive thanks to Nixon for the way he had treated her and Israel.
But moments after she left, Nixon and Mr. Kissinger were brutally dismissive in response to requests that the United States press the Soviet Union to permit Jews to emigrate and escape persecution there.
“The emigration of Jews from the Soviet Union is not an objective of American foreign policy,” Mr. Kissinger said. “And if they put Jews into gas chambers in the Soviet Union, it is not an American concern. Maybe a humanitarian concern.”
“I know,” Nixon responded. “We can’t blow up the world because of it.”
In his discussion with Ms. Woods, Nixon laid down clear rules about who would be permitted to attend the state dinner for Meir — he called it “the Jewish dinner” — after learning that the White House was being besieged with requests to attend.
“I don’t want any Jew at that dinner who didn’t support us in that campaign,” he said. “Is that clear? No Jew who did not support us.”
Nixon listed many of his top Jewish advisers — among them, Mr. Kissinger and William Safire, who went on to become a columnist at The New York Times — and argued that they shared a common trait, of needing to compensate for an inferiority complex.
“What it is, is it’s the insecurity,” he said. “It’s the latent insecurity. Most Jewish people are insecure. And that’s why they have to prove things.”
Nixon also strongly hinted that his reluctance to even consider amnesty for young Americans who went to Canada to avoid being drafted during the Vietnam War was because, he told Mr. Colson, so many of them were Jewish.
“I didn’t notice many Jewish names coming back from Vietnam on any of those lists; I don’t know how the hell they avoid it,” he said, adding: “If you look at the Canadian-Swedish contingent, they were very disproportionately Jewish. The deserters.”
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