Grassroot Perspective – Jan. 9, 2003-Topics: Health Plan Issues; Water Troubles; the Honolulu Bus Rapid Transit System

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Dick Rowland Image ‘Shoots (News, Views and Quotes)’ – Money-Saving Flexible Spending Accounts To Be Offered By Federal Government Source: Office of Personnel Management, 09/17/02 The U.S. Office of Personnel Management announced that several consumer-driven health plans will be available to federal workers starting next year. The American Postal Workers Union will offer a new option nationwide to those enrolled in the Federal Employees Health Benefits Program. Enrollees will receive a health-spending account worth $1,000 for individuals and $2,000 for families to cover eligible out-of-pocket costs. Individuals would then pay the next $600 of health costs and families, $1,200, before traditional insurance triggers in (with the plan paying 85 percent of medical costs). Flexible spending accounts also will be offered to federal employees beginning in July 2003. Employees will be able to set aside up to $3,000 in a tax-free account to cover out-of-pocket medical expenses and up to $5,000 for child care or elder care. FEHBP costs, rising an average of 11.1 percent, were lower than industry averages: “Having a choice of plans promotes healthy competition among carriers for subscribers and helps contain costs,” said OPM director Kay Coles James. Full text: Quoted from Galen Institute 9/20/02 Grassroot Institute of Hawaii comment: A good deal for federal workers. Too bad that Hawaii’s Prepaid Health Care Act precludes such innovative customer focused alternatives here. – Water Troubles Water is a scarce resource. However, unlike most resources it is a necessary component of life. A recent report finds that a worldwide water crisis is brewing. Global water demand tripled between 1950 and 1990, and is expected to double again by 2025. Fresh water supplies are being tapped out. Many, including the World Bank, argue that water providers should be a public-private partnership, not simply public entities. In developing countries, the World Bank found that: *One third of public water utilities cannot account for 40 percent of their water due to illegal connections or leaks. *Public utilities overstaff, inflate costs, irregularly collect fees from users, and service coverage is not complete. Those in favor of public-private partnerships argue that only private investment can afford to cover the cost of fixing the water infrastructure. The American Water Works Association estimates that in the United States alone, restoring drinking-water infrastructure will require about $325 billion over the next two decades. Moreover, they also argue that the only way to encourage conservation is to charge for water. However, the opponents argue that water is more than just a commodity, but a necessity for life. To the opponents, depending on corporations with no public interest to provide a necessity is a risky venture. Additionally, privatization of water has led to severe public disturbances in several places including Bolivia, Peru, India, Poland and South Africa. After years of subsidized water supplies, people are accustomed to getting water for free, researchers say. Source: Melissa Master, “Just Another Commodity,” Across the Board, July/August 2002. Quoted from Daily Policy Digest 10/9/02 ‘Roots (Food for Thought)’ – Honolulu BRT Recently we have been asked several times why we’re so adamant in our opposition to the Honolulu City/County proposed BRT system. One of the best ways to put a frame around our view is to quote some knowledgeable federal transportation experts: “Today’s surface transportation sector faces a need for radical overhaul to bring it into the post-industrial 21st century. In current metropolitan systems, there is no managed relationship between supply and demand-it is a “dumb” system with few of the system owners (state and local governments) taking responsibility seriously. … The curious thing is that most of us as consumers accept this situation as the best our transportation agencies can do. Imagine living with hand-cranked, wall-mounted, operator-manned telecommunications today, as we still live with 1950s highway technology. What we accept in transportation, we don’t accept in other services.” – Stephen Lockwood, former Associate Administrator for Policy, FHWA “Congestion is a problem of demand outpacing capacity. We need to break the anti-highway cycle that has plagued us. Sometimes transportation is really about asphalt, concrete and steel.” – FHWA Administrator Mary Peters “We wil indeed have to build our way out of some of the congestion.” – Christine Johnson, Program Manager, FHWA On need for accountability to customers: “Accountability means that someone or some group expects a certain level of performance, has an ability to judge whether it is delivered, (and) is able to pinpoint responsibility if it isn’t delivered, often with very specific consequences.” She added, “with no institutionalized ownership of the problem, accountability can be diffused among dozens of organizations.” – Christine Johnson, Program Manager, FHWA To summarize: *The lack of genuine accountability (no specific person suffers if it fails) surrounding the BRT promotion and the profusion of organizations and individuals involved almost guarantees failure. *The wants and needs of customers are ignored or papered over. Busy people want to drive cars, make multiple stops, solve various problems beside go to work and back. *”Roads in a Market Economy” by Gabriel Roth (Ashgate Publishing co 1996) points out that among the fundamental differences between the telecommunications system and the highway system (both of them network utilities) is the lack of real owners of the latter. A highway corporation that derives its revenues directly from its customers — and only gets paid if it delivers what they want and need — would be a whole new ball game. As if by an invisible hand, it would embrace an “operation vision,” responding to congestion (or the need to accommodate heavier trucks) by adding new capacity if, and to the extent that, customers were willing to pay what it cost to build and operate that capacity.” – GRIH comment: Please note that the City/County Director of Transportation, the lead BRT proponent, is focused not on solving your transportation problems or mine. Instead, she is focusing on solving the mythical problems of assumed new BRT riders and “doing something” by getting federal money to feed consultants and (eventually) contractors. Yes, indeed, we are opposed, and until assured that advocates will somehow be held accountable, that attitude is unlikely to change. After all, would you shop at a store that knew it would never have to stand behind the products sold? ‘Evergreen (Today’s Quote)’ – The Remarkable Market Economy: “Perhaps the single most magnificent fact about life in a market economy is that each of us benefits from the creativity, knowledge, and efforts of the millions upon millions of our fellows. And to receive these benefits, all that we must do in our capacity as citizens is to respect the property rights and peaceful choices of others. It’s really quite simple.” – Donald J. Boudreaux, Ideas on Liberty, October 2001 – A better solution: “Instead of adopting soak-the-rich approach, we should move quickly on those matters on which there should be common ground. The whole array of regulations that reduce the efficiency of markets and produce undeserved winners — unjust beneficiaries of government favors — should be repealed. This liberalization would not only vindicate the approach of classical-liberal theories, but also reduce the unfairness in wealth distribution that leads to misguided calls for higher and more progressive taxes.” – University of Chicago law professor Richard Epstein, in a National Review book review (7/1/02) Above articles from Ethan Allen Institute Newsletter 11/02 ”See Web site” ”for further information. Join its efforts at “Nurturing the rights and responsibilities of the individual in a civil society. …” or email or call Grassroot of Hawaii Institute President Richard O. Rowland at or (808) 487-4959.”