According to one study (Banarto, McClellan, Kagy and Garber, 2004), 30% of all Medicare expenditures are attributed to the 5% of beneficiaries that die each year, with 1/3 of that cost occurring in the last month of life.
There are various studies that come to more or less the same conclusion. Of course, virtually nobody knows beforehand that the upcoming year will be their last – and even if they did, they would likely want to fight it all the way.
Going into that last year? Who knows? Is this my last year of life? Is it yours? In hindsight it is easy to make such a statement, to perform this calculation. Beforehand, not so much.
Of course, we can see the signs, the factors that correlate with the proximity of the end. Age isn’t necessarily a good one – some people at 80 are much healthier than others at 60. But chronic illness, recurring medical emergencies, obesity, limited mobility, the visible effects of too many years of alcohol abuse and tobacco use, a sedentary lifestyle.
In other words, we can see the signs; yet, do we know that the appearance of such signs means it is the last year? No, of course we do not.
Now, before you look back up at the header to confirm if you are at the right blog…”why is bionic writing about this? What does he know about the last days of life? Is he dying?”
Well, for the last question…yes, eventually. But no in the context of this post, at least not to my knowledge (but that is kind of my point, isn’t it).
The new Labour leader, Jeremy Corbyn, has said that a Labour government would introduce “people’s QE”, that is to say, increased government spending, perhaps on infrastructure, financed with printed money.
What is “people’s QE”?
Labour leadership candidate, Jeremy Corbyn MP, will this morning outline his vision for a modern, more productive, fairer economy for all.
He will call for the establishment of an National Investment Bank to promote infrastructure upgrades and support for innovation.
This isn’t plain enough (leave it to a political party to obfuscate their true intent). Which takes me to “Jeremy Corbyn's QE for the people is exactly what the world may soon need,” by Ambrose Evans-Pritchard:
There are many good reasons to gasp at Jeremy's Corbyn's planned assault on capital, but his enthusiasm for "People's QE" is not one of them.
What a relief; according to Ambrose we need not fear this “people’s QE.”
Overt monetary financing of deficits - the technical term - is exactly what the world will need if the global economy tips into another recession with interest rates already at zero and debt ratios stretched to historic extremes.
Wait a minute…haven’t they been doing this for a while now? I guess what has gone on for the last 8 years (and in less dramatic fashion for decades and centuries before this) has been “covert” not “overt.”
But what Ambrose says we should not fear is outright money printing – literally and directly fund spending via the creation of currency and its digital equivalents – no national debt, just greenbacks. I don’t think he is serious; can he be?
Jeremy Lawson, from Standard Life, gave his blessing to radical action this week, arguing central banks should be willing to fund fiscal stimulus directly, and even inject money "directly into household bank accounts" if need be.
Yes, he is serious.
Mr Corbyn's ideas are a variant of "helicopter money", the term coined by Milton Friedman, the doyen of monetary orthodoxy, lest we forget.
And some people consider Friedman the 20th century’s greatest champion of liberty. Joke’s on them (actually the joke is on us, but they don’t care).
Friedman did not, of course, mean that banknotes should be dropped from the sky, though they could be in extremis…
Ambrose is dead serious. Well, maybe not “dead,” but…wait, I will spoil the punch line.
We cannot revert to plain vanilla forms of quantitative easing at this stage.
Eight years ago, trillions from nothing would not have been considered “plain vanilla.” Today? I guess it is considered sound banking practice. Anyway, don’t worry, they will tightly control this new practice:
"There has to be an absolutely watertight regime with rules to insure that it is not overused or misused," [Lord Turner, the former head of the Financial Services Authority] said.
Watertight regime with rules?!?!?!?!?!? Pardon me for a moment….HAHAHAHA, HOHOHOHO, HEEHEEHEEHEE.
OK, I’m back.
Ambrose is afraid of this tactic being implemented by someone as economically dangerous as Corbyn of the Labour Party. He prefers someone more willing to lie about the intent. No, really; he does – he wants liars in charge. Look I don’t just make this stuff up:
It would be safer if such a high-risk experiment - should it prove necessary - were entrusted to a blue-chip reactionary, and were discretely slipped through under a different guise. We could call it "nominal GDP management" to avoid frightening the horses.
He even says “we,” like Ambrose himself is part of the regime…oh, wait; I already knew the answer to that one.
By the way, if the free-market cred of Friedman isn’t enough for you, Ambrose offers even more cover:
If the private sector will not rise to the challenge, it is up to the state to take on the responsibility, a duty advocated by none other than Adam Smith.
The true champion of liberty in the 20th century, Murray Rothbard, wrote of Smith:
…businessmen and free market advocates have long hailed Adam Smith as their patron saint.
That would be Ambrose.
On the other hand, Marxists, with somewhat more justice, hail Smith as the ultimate inspiration of their own Founding Father, Karl Marx.
Ambrose? Say it ain’t so!
Of course, Ambrose is advocating greenbacks – instead of sanitizing (laundering) the money printing through bond purchases, the funding should go directly toward spending without any increase in debt.
Without a blink he cites a prior example:
Variants of People's QE were tried in the inter-war years. Japan's Christian prime minister Takahashi Korekiyo instructed the Bank of Japan in 1932 to fund a blitz of fiscal spending until deflation was defeated, pulling his country out of the Great Depression remarkably quickly.
Does it help somehow to know that he was a Christian? Anyway, more important to remember that Japan at the time was in the midst of one of the greatest military adventures of the 20th century.
Ambrose doesn’t cite another 20th century example, but Ellen Brown does (and throws in a nineteenth century example to boot) – the following courtesy of Gary North (in his critique of Ellen Brown, an advocate today of greenbacks):
With this as background, I return to Brown's discussion of National Socialism.
Like for Lincoln, Hitler's choices were to either submit to total debt slavery or create his own fiat money; and like Lincoln, he chose the fiat solution. He implemented a plan of public works along the lines proposed by Jacob Coxey and the Greenbackers in the 1890s. Projects earmarked for funding included flood control, repair of public buildings and private residences, and construction of new buildings, roads, bridges, canals, and port facilities. The projected cost of the various programs was fixed at 1 billion units of the national currency. One billion non-inflationary bills of exchange, called Labor Treasury Certificates, were then issued against this cost. Millions of people were put to work on these projects, and the workers were paid with the Treasury Certificates. The workers then spent the certificates on goods and services, creating more jobs for more people. . . .
Within two years, the unemployment problem had been solved and the country was back on its feet. It had a solid, stable currency and no inflation, at a time when millions of people in the United States and other Western countries were still out of work and living on welfare. [Web of Debt, p. 234.]
Imperial Japan, Nazi Germany, and Lincoln. Oh, if only Hitler and Lincoln submitted “to total debt slavery” instead of choosing the “fiat solution.” Who knows how many countless millions would not have prematurely found themselves in their last year of life?
But bionic, that isn’t what Ambrose is talking about!
I don’t care what Ambrose is talking about – all mainstream thought leaders ignore the connection of fiat (in any form) and war. Unconstrained government spending leads always to or supports an ever-growing unconstrained government. And by the way, Britain and the US are pretty well demonstrating the whole imperialistic global war thing.
This is what Ambrose wants to fund.
But now I have allowed myself to get a bit sidetracked – what with National Socialism offered as an economic model, etc.
So, back to the extraordinary medical expense during the last year of life.
The economic system that was ushered in at Bretton Woods that received its first significant blow in 1971 and that went on life support in 2008 is close to dying. Like chronic illness, recurring medical emergencies, and obesity in a human patient, we can see all the signs but cannot be certain of when the end will come. Yet, like the person afflicted with all the symptoms, the fight will continue until the bitter end – no matter the cost.
Until price inflation becomes politically painful, any and every monetary crank experiment will be tried – money is no object; they can print more! They will return to greenbacks. They will drop $10,000 into every bank account.
By the time they try every experiment, they will have consumed untold trillions in productive assets – consumed by unproductive users. They are spending untold wealth on a patient that is certain to die soon (at least soon in empire-years).
The world will be the poorer for it. And maybe countless millions will die. It has happened before; all that saves many of us (but not all) from this today is the fear that the elites have of nuclear war.
They are willing to pay any amount of (someone else’s) wealth to find a cure. They should take sound words of advice from the sage, Les Claypool: “There ain't no cure for suicide.”