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mostlysignssomeportents · 2 months

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When private equity destroys your hospital

I'm on tour with my new novel The Bezzle! Catch me TOMORROW in PHOENIX (Changing Hands, Feb 29) then Tucson (Mar 9-10), San Francisco (Mar 13), and more!

As someone who writes a lot of fiction about corporate crime, I naturally end up spending a lot of time being angry about corporate crime. It's pretty goddamned enraging. But the fiction writer in me is especially upset at how cartoonishly evil the perps are – routinely doing things that I couldn't ever get away with putting in a novel.

Beyond a doubt, the most cartoonishly evil characters are the private equity looters. And the most cartoonishly evil private equity looters are the ones who get involved in health care.

(Buckle up.)

Writing for The American Prospect, Maureen Tcacik details a national scandal: the collapse of PE-backed hospital chain Steward Health, a company that bought and looted hospitals up and down the country, starving them of everything from heart valves to prescription paper, ripping off suppliers, doctors and nurses, and callously exposing patients to deadly risk:

https://prospect.org/health/2024-02-27-scenes-from-bat-cave-steward-health-florida/

Steward occupies a very special place in the private equity looting cycle. Private equity companies arrange themselves on a continuum of indiscriminate depravity. At the start of the continuum are PE funds that buy productive and useful firms (everything from hospitals to car-washes) using "leveraged buyouts." That means that they borrow money to buy the company and use the company itself as collateral: it's like you getting a bank-loan to buy your neighbor's mortgage out from under them, and using your neighbor's house as collateral for that loan.

Once the buyout is done, the PE fund pays itself a "special dividend" (stealing money the business needs to survive) and then starts charging the business a "management fee" for the PE fund's expertise. To pay for all this, the PE bosses start to hack away at the company. Quality declines. So do wages. Prices go up. The company changes suppliers, opting for cheaper alternatives, often stiffing the old company. There are mass layoffs. The remaining employees end up doing three peoples' jobs, for lower wages, with fewer materials of lower quality.

Eventually, that top-feeding PE company finds a more desperate, more ham-fisted PE company to unload the business onto. That middle-feeding company also does a leveraged buyout, pays itself another special dividend, cuts wages, staffing and quality even further. They switch to even worse suppliers and stiff the last batch. Prices go up even higher.

Then – you guessed it – the middle-feeding PE company finds an even more awful PE bottom-feeder to unload the company onto. That bottom feeder does it all again, without even pretending to leave the business in condition to do its job. The company is a shambling zombie at this point, often producing literal garbage in place of the products that made its reputation. Employees' paychecks bounce, or don't show up at all. The company stops bothering to pay the lawyers that have been fending off its creditors. Those lawyers sue the company, too.

That's the kind of PE company Steward Health was, and, as the name suggests, Steward Health is in the business of stripping away the very last residue of value from community hospitals. As you might imagine, this gets pretty fucking ugly.

Steward owns 32 hospitals up and down the country, though its holdings are dwindling as the company walks away from its debt-burdened holdings, after years of neglect that have rendered them unfit for use as health facilities – or for any other purpose. Tcacik's piece offers a snapshot of one such hospital: Florida's Rockledge Regional Medical Center, just eight miles from Cape Canaveral.

Rockledge is a disaster. The fifth floor was, at one point, home to 5,000 bats.

Five.

Thousand.

Bats.

(Rockledge stiffed the exterminators.)

The bats were just the beginning. One of the internal sewage pipes ruptured. Whole sections of the hospital were literally full of shit, oozing out of the walls and ceiling, slopping over medical equipment.

That's an urgent situation for any hospital, but for Rockledge, it's catastrophic, because Rockledge is a hospital without any hospital supplies. Steward has stiffed the companies that supply "heart valves, urology lasers, Impella catheters, cardiac catheterization balloons, slings for lifting heavier patients, blood and urine test reagents, and most recently, prescription paper." Key medical equipment has been repossessed. So have the Pepsi machines. The hospital cafeteria had its supply of cold cuts repossessed:

https://www.reddit.com/r/massachusetts/comments/1agc1j4/comment/kolicqo/

It's not just Steward's nonpayments that reek of impending doom. Its payments also bear the hallmarks of a scam artist on the brink of blowing off the con. The company recently paid off a vendor with five separate checks for $1m, each drawn on "a random hospital in Utah" (Steward recently walked away from its Utah hospitals; its partners there are suing it for stealing $18m on their way out the door).

This company – which owns 32 hospitals! – has resorted to gambits like sending photos of fake checks to doctors it hasn't paid in months as "proof" that the money was coming (the checks arrived 22 days later).

Steward owes so much money to its employees – $1.66m to just one doctors' group. But the medical staff keep doing their jobs, and are reluctant to speak on the record, thanks to Steward's reputation for vicious retaliation. Those health workers keep showing up to take care of patients, even as the hospital crumbles around them. One clinician told Tcacik: "I watched a bed collapse underneath a [patient] who had just undergone hip surgery."

Rockledge has nine elevators, but only five of them work – the other four have been broken for a year. The hospital's fourth floor has been converted to "a graveyard of broken beds." The sinks are clogged, or filled with foul gunk. There's black mold. Nurses have noted on the maintenance tags that the repair service refuses to attend the hospital until their overdue bills are paid. The fifteen-person on-site maintenance team was cut to just two workers.

Steward is just the latest looting owner of Rockledge. After the Great Financial Crisis, private equity consultants helped sell it to Health Management Associates. The hospital's CEO took home a $10m bonus for that sale and exited; Health Management Associates then quickly became embroiled in a Medicare fraud and kickback scandal. Soon after, Rockledge was passed on to Community Health Systems, who then sold it on to Rockledge.

Steward, meanwhile, was at that time owned by an even bigger private equity giant, Cerberus, which then sold Steward off. That deal was performatively complex and hid all kinds of mischief. Prior to Cerberus's sell-off of Steward, they sold off Steward's real-estate. The buyer was Medical Properties Trust, who gave Cerberus $1.25b for the real-estate: three hospitals in Florida and three more in Ohio. Steward then contracted to operate these hospitals on MPT's behalf, and pay MPT rent for the real-estate.

This complex arrangement was key to siphoning value out of the hospital and to keeping angry creditors at bay – if you can't figure out who owes you money, it's a lot harder to collect on the debt. The scheme was masterminded by Steward founder/CEO Ralph de la Torre. De la Torre is notorious for taking a massive dividend out of the company while it owed $1.4b to its creditors. He bought a $40m yacht with the money.

De la Torre was once feted as a business genius who would "disrupt" healthcare. But as Steward's private jet hops around "Corfu, Santorini, St. Maarten and Antigua" as its hospitals literally crumble, he's becoming less popular. In Massachusetts, politicians have railed against Steward and de la Torre (Governor Healey wants the company to leave the state "as soon as possible").

Florida, by contrast, is much more friendly to Steward. The state Health and Human Services Committee chair Randy Fine is an ardent admirer of hospital privatization and is currently campaigning to sell off the last community hospital in Brevard County. The state inspectors are likewise remarkably tolerant of Steward's little peccadillos. The quasi-governmental agency that inspects hospitals has awarded this shit-and-bat-filled, elevator-free, understaffed rotting hulk "A" grades for quality.

These inspectors jointly represent a mismatched assortment of private and public agencies, dominated by a nonprofit called Leapfrog, the brainchild of Harvard public-health prof Lucian Leape, who founded it in 2000. Leapfrog likes to tout its "transparent" assessment criteria, and Steward are experts at hitting those criteria, spending the exact minimum to tick every box that Leapfrog inspectors use as proxies for overall quality and safety.

This is a pretty great example of Goodhart's Law: "every measurement eventually becomes a target, whereupon it ceases to be a good measurement":

https://xkcd.com/2899/

But despite Steward's increasingly furious creditors and its decaying facilities, the company remains bullish on its ability to continue operations. Medical Properties Trust – the real estate investment trust that is nominally a separate company from Steward – recently hosted a conference call to reassure Wall Street investors that it would be a going concern. When a Bank of America analyst asked MPT's CFO how this could possibly be, given the facility's dire condition and Steward's degraded state, the CFO blithely assured him that the company would get bailouts: "We own hospitals no one wants to see closed."

That's the thing about PE and health-care. The looters who buy out every health-care facility in a region understand that this makes them too big to fail: no matter how dangerous the companies they drain become, local governments will continue to prop them up. Look at dialysis, a market that's been cornered by private equity rollups. Today, if you need this lifesaving therapy, there's a good chance that every accessible facility is owned by a private equity fund that has fired all its qualified staff and ceased sterilizing its needles. Otherwise healthy people who visit these clinics sometimes die due to operator error. But they chug along, because no dialysis clinics is worse that "dialysis clinics where unqualified sadists sometimes kill you with dirty needles":

https://www.thebignewsletter.com/p/the-dirty-business-of-clean-blood

The bad news is that private equity has thoroughly colonized the entire medical system. They took hospitals, fired the doctors, then took over the doctors' groups that provided outsource staff to the hospital:

https://pluralistic.net/2020/04/04/a-mind-forever-voyaging/#prop-bets

It's illegal for private equity companies to own doctors' practices (doctors have to own these), but they obfuscated the crime with a paper-thin pretext that they got away with despite its obvious bullshittery:

https://pluralistic.net/2020/05/21/profitable-butchers/#looted

The financier who decides whether you live or die depends on an algorithm that literally sets a tolerable level of preventable deaths for the patients trapped in the practice:

https://pluralistic.net/2023/08/05/any-metric-becomes-a-target/#hca

Private equity also took over emergency rooms and boobytrapped them with "surprise billing" – junk fees that ran to thousands of dollars that you had to pay even if the hospital was in network with your insurer. They made billions from this, and spent a many millions from that booty keeping the scam alive with scare ads:

https://pluralistic.net/2020/04/21/all-in-it-together/#doctor-patient-unity

The whole health stack is colonized by private equity-backed monopolies. Even your hospital bed!

https://pluralistic.net/2022/01/05/hillrom/#baxter-international

Then there's residential care. Private equity cornered many regional markets on nursing homes and turned them into slaughterhouses, places where you go to die, not live:

https://pluralistic.net/2021/02/23/acceptable-losses/#disposable-olds

The palliative care sector is also captured by private equity. PE bosses hire vast teams of fast-talking salespeople who con vulnerable older people into entering an end-of-life system before they are ready to die. Thanks to loose regulation, the nation is filled with fake hospices that can rake in millions from Medicare while denying all care to their patients (hospice patients don't get life-extending medication or procedures, by definition):

https://pluralistic.net/2023/04/26/death-panels/#what-the-heck-is-going-on-with-CMS

If you survive this long enough, Medicare eventually tells the hospice that you're clearly not dying and you get kicked off their rolls. Now you have to go through the lengthy bureaucratic nightmare of convincing the system – which was previously informed that you were at death's door – that you are actually viable and need to start getting care again (good luck with that).

If that kills you, guess what? Private equity has rolled up funeral homes up and down the country, and they will scam your survivors just as hard as the medical system that killed you did:

https://pluralistic.net/2022/09/09/high-cost-of-dying/#memento-mori

The PE sector spent more than a trillion dollars over the past decade buying up healthcare companies, and it has trillions more in "dry powder" allocated for further medical acquisitions. Why not? As the CFO of Medical Properties Trust told that Bank of America analyst last week, when you "own hospitals no one wants to see closed." you literally can't fail, no matter how many people you murder.

The PE sector is a reminder that the crimes people commit for money far outstrip the crimes they commit for ideology. Even the most ideological killers are horrified by the murders their profit-motivated colleagues commit.

Last year, Tkacic wrote about the history of IG Farben, the German company that built Monowitz, a private slave-labor camp up the road from Auschwitz to make the materiel it was gouging Hitler's Wehrmacht on:

https://pluralistic.net/2023/06/02/plunderers/#farben

Farben bought the cheapest possible slaves from Auschwitz, preferentially sourcing women and children. These slaves were worked to death at a rate that put Auschwitz's wholesale murder in the shade. Farben's slaves died an average of just three months after starting work at Monowitz. The situation was so abominable, so unconscionable, that the SS officers who provided outsource guard-labor to Monowitz actually wrote to Berlin to complain about the cruelty.

The Nuremberg trials are famous for the Nazi officers who insisted that they were "just following order" but were nonetheless executed for their crimes. 24 Farben executives were also tried at Nuremberg, where they offered a very different defense: "We had a fiduciary duty to our shareholders to maximize our profits." 19 of the 24 were acquitted on that basis.

PE is committed to an ideology that is far worse than any form of racial animus or other bias. As a sector, it is committed to profit above all other values. As a result, its brutality knows no bounds, no decency, no compassion. Even the worst crimes we commit for hate are nothing compared to the crimes we commit for greed.

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2024/02/28/5000-bats/retaliation#charnel-house

#pluralistic #Rockledge Regional Medical Center #private equity #looting #Steward Health #ponzis #maureen tcacik #Medical Properties Trust #Ralph de la Torre #Massachusetts #florida #Cerberus #too big to fail #pe #guillotine watch

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mostlysignssomeportents · 2 months

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Brinkwhump Linkdump

I'm on tour with my new, nationally bestselling novel The Bezzle! Catch me in TUCSON (Mar 9-10), then San Francisco (Mar 13), Anaheim, and more!

Once again, I find myself arriving at the weekend with a giant backlog of links, triggering a linkump, the 15th such dumpage, a variety-pack of miscellany for your weekend. Here's the previous editions:

https://pluralistic.net/tag/linkdump/

Let's start with the latest incredible news from KPMG, the accounting and auditing giant that is relied upon as a source of ground truth for a truly terrifying share of the world's economy. KPMG has a well-deserved reputation for incompetence and corruption. They first came on my radar in 2001 when they sent a legal threat to a blogger for linking to their website without permission:

https://memex.craphound.com/2001/12/05/reason-4332442-not-to-ask/

The actual link was to KPMG's corporate anthem, which remains, to this day, a banger:

https://web.archive.org/web/20040428063826/http://chkpt.zdnet.com/chkpt/uknewsita/http://anthems.zdnet.co.uk/anthems/kpmg.mp3

Don't miss the DJ remixes (and the Nokia ringtone!) that the internet thoughtfully provided when KPMG decided that it didn't want the world to know about "Our Vision of Global Strategy":

https://web.archive.org/web/20011128153057/http://corporateanthems.raettig.org/

Now all this is objectively very funny, a relic of the old, good internet from one of its moments of glory, but KPMG? They were already enshittifying, even in 2001, and the enshittification only intensified thereafter. Nearly every accounting scandal of the past quarter-century has KPMG in it somewhere, from con-artists selling exhausted oil fields to rubes:

https://www.desmog.com/2021/06/03/miller-energy-kpmg-auditors-oil-fraud/

To killer nursing homes that hire KPMG to audit its books – and to advise it on how to defeat safety audits and murder your grandma:

https://pluralistic.net/2023/05/09/dingo-babysitter/#maybe-the-dingos-ate-your-nan

They're the architects of Microsoft's tax-evasion plot:

https://www.propublica.org/article/the-irs-decided-to-get-tough-against-microsoft-microsoft-got-tougher

And they were behind Canada's dysfunctional covid contact-tracing app, which never worked, but generated tens of millions in billings to the government of Canada, who used KPMG to hire programmers at $1,500/day, plus KPMG's 30% commission:

https://pluralistic.net/2023/01/31/mckinsey-and-canada/#comment-dit-beltway-bandits-en-canadien

KPMG's most bizarre scandal is literally stranger than fiction. The company bribed SEC personnel help its own accountants cheat on ethics exams. The corrupt officials were then given high-paid jobs at KPMG:

https://www.nysscpa.org/news/publications/the-trusted-professional/article/sec-probe-finds-kpmg-auditors-cheating-on-training-exams-061819

I mean it when I say this is stranger than fiction. I included it as a plot-point in my new finance crime novel The Bezzle (now a national bestseller!), and multiple readers have written to me since the book came out a couple weeks ago to say that they thought I was straining their credulity by making up such an outrageous scandal:

https://us.macmillan.com/books/9781250865878/thebezzle

But all of that is just scene-setting (and a gratuitous plug for my book) for the latest KPMG scandal, which is, possibly, the most KPMG scandal of all KPMG scandals. The Australian government hired KPMG to audit Paladin, a security contractor that oversees the asylum seekers the country locks up on one of its island gulags (yes, gulags, plural).

Ever since, Paladin has been the subject of a string of ghastly human rights scandals – the worst stuff imaginable, rape and torture and murder of adults and children. Paladin made AU423 million on this contract.

And here's the scandal: KPMG audited the wrong company. The Paladin that the Australia government paid KPMG to audit was based in Singapore. The Paladin that KPMG audited was a totally different company, based in Papua New Guinea, who already had a commercial relationship with KPMG. It was this colossal fuckup that led to the manifestly unfit Singaporean company getting nearly half a billion dollars in public funds:

https://www.theguardian.com/business/2024/feb/24/incredible-failure-kpmg-rejects-claims-it-assessed-the-wrong-company-before-423m-payment-to-paladin

KPMG denies this. KPMG denies everything, always. Like, they denied creating "power maps" of decision-makers in the Australian government to target with influence campaigns in order to win contracts like this one. Who knows, maybe, this one time, they're telling the truth? After all, the company whose employees gather to sing lyrics like these can't be all bad, right?

The time is now to lead the way, We share the same the idea That may win by the end of the day. Our strength is here to stay. Identity, one energy, One strategy, with sympathy. These are the words that will lead us into a new world.

https://everything2.com/title/KPMG+corporate+anthem

You may find it strange that I'm still carrying around the factoid that KPMG once threatened to crush a blogger for linking to its terrible corporate anthem, but that's just my "Memex Method," which helps me keep track of literally everything that seemed important to me through most of my adult life:

https://pluralistic.net/2021/05/09/the-memex-method/

One of my favorite quips from the very quotable Riley Quinn is that "leftists are cursed with object-permanence" – that is, we actually remember what just happened and use it to think about what's happening now. The Memex Method is object permanence for 20+ years worth of stuff. A lot of those deep archives never see use, but there's a surprising number of leading indicators buried in the stuff that happened in years gone by.

Take James Boyle's 2014, XKCD-style comic about the experience of driving a notional Apple car:

https://www.thepublicdomain.org/2014/11/07/apple-updates-a-comic/

Apple, it turns out, spent the next decade working on just such a car, and while that car has now been canceled, Boyle's comic correctly anticipates so much about the trajectory Apple's products took. It's uncannily accurate – real "don't invent the torment nexus"/"cyberpunk was a warning, not a suggestion" stuff:

https://knowyourmeme.com/memes/torment-nexus

But no matter how many times we insist that the torment nexus shouldn't be created, the boardrooms of end-stage capitalism continue to invent them. Take HP, the poster-child for enshittification, edging out even KPMG in the race to turn everything into a pile of shit. After years of tormenting people to punish them for wanting to print things, HP has announced a new service that so mustache-twirlingly evil that it lacks verisimilitude:

https://arstechnica.com/gadgets/2024/02/hp-wants-you-to-pay-up-to-36-month-to-rent-a-printer-that-it-monitors/

Here's the pitch: HP will sell you a printer that you don't own. In addition to paying a monthly fee for your ink – which you pay no matter whether you print or not – you will also pay a monthly fee just for having HP's printer on your premises. You are absolutely, positively forbidden from using third-party ink in this printer, and must use HP's own ink, which sells for about $10,000/gallon.

But while you aren't allowed to use this printer in ways that are bad for HP's shareholders, HP is absolutely free to use the printer in ways that are bad for you. When you click through the signup agreement, you grand HP permission to surveil every document you print – and your home wifi network more generally – and to sell that data to anyone and everyone.

What's more, HP reserves the right to discipline you with punitive credit-card charges if you disconnect this printer from the internet, on the basis that doing so makes it harder for them to spy on your printer.

I'm sorry, this is just more torment nexus shit, the kind of thing you'd expect to drop on Apr 1, not Feb 29, but I guess this is where we are. I can only conjecture as to whether HP's businesses strategists are directly taking direction from my novella "Unauthorized Bread," or whether they're learning about it second-hand from a KPMG consultant who converted it to Powerpoint form and charged $1,500/day for the work:

https://arstechnica.com/gaming/2020/01/unauthorized-bread-a-near-future-tale-of-refugees-and-sinister-iot-appliances/

All of this cartoonish villainry is the totally foreseeable consequence of a culture of impunity, in which companies like HP and KPMG can rob, cheat, steal (and sometimes even kill) without consequence. This impunity is so pervasive that the exceptions – where a rich criminal faces real consequences – become touchstones: Enron, Arthur Anderson, Theranos, and, of course, FTX.

FTX was arguably the largest-scale corporate crime in world history, stealing more than $10 billion dollars, mostly from rubes sucked in by hype and Superbowl ads. When news that FTX founder and owner Sam Bankman-Fried was convicted of fraud and was in for a lengthy prison sentence made a huge stir, because criminals like SBF usually walk away from the wreckage with their hands in their pockets, whistling a jaunty tune.

One of the very best commentators on cryptocurrency scams generally and FTX/SBF in particular is Molly White, whose Web3 is Going Just Great feed is utterly indispensable. White's newsletter, "Citation Needed," dives deep into the wrangle of SBF's sentencing:

https://www.citationneeded.news/issue-52/

Bankman-Fried's parents – prominent law professors at top law schools – helped brief the court this week on their son's punishment. According to them, SBF faces 100 years in prison, but should be sentenced to 5.5-6.5 years at the most. Why? Because he is a vegan, who is not greedy, and feels remorse, and cares for individuals (recall that SBF presented himself as the avatar of the batshit "effective altruism" philosophy while privately admitting that he used this as a smokescreen).

The most bizarre note in the 100-page filing is SBF's mother declaring that her son is an "angel of mercy," apparently unaware of the grisly meaning of that term:

https://en.wikipedia.org/wiki/Angel_of_mercy_(criminology)

America's prisons are a travesty and I wouldn't wish them on anyone, but that's not the argument SBF's parents are making; rather, they're arguing that their special boy doesn't deserve the treatment America metes out to poorer, less white people who merely steal hundreds or thousands of dollars. A crook who steals ten billion should be handled the way a casino handles a whale – with concierge service.

The problem is, there are so many of these remorseless, relentless crooks that there's no way we could scale up that white-glove treatment when we finally round 'em all up and make them pay. Writing for The American Prospect, Maureen Tkacik tells us about the ransomware attack that shut down America's pharmacy system last month:

https://prospect.org/health/2024-03-01-zoomer-hackers-shut-down-unitedhealthcare/

The attack brought down Change Healthcare, part of the monopolist Unitedhealth, which serves as the "pharmacy benefit manager" to a vast swathe of American pharmacies. PBM is one of those all-American finance scams, a middleman garlanded with performative complexity put there to make you feel stupid for asking why independent pharmacies all have to pay rent to this malicious, unaccountable – and now, manifestly incompetent – gang of crooks.

Tkacik's breakdown of this scam – and how it rendered Americans' ability to get the drugs they depend on to go on breathing – is characteristically brilliant. Tcacik is fast emerging as my favorite Explainer of Scams, a print version of John Oliver or Adam Conover. You may recall her work from my post last week on how private equity has taken a wrecking ball to America's hospitals:

https://pluralistic.net/2024/02/28/5000-bats/#charnel-house

I always try to finish these linkdumps with some upbeat news to carry you through the weekend, and this week brought two genuinely wonderful – and totally underreported – pieces of amazing news.

The first is that Starbucks has sued for peace in the war against its workers' unions. Hundreds of Starbucks stores have unionized in recent years, but not one of them had a contract. Instead, Starbucks had waged dirty war on their own workers, from denying gender-affirming care to unionized employees to simply shutting down whole stores after they voted to unionize:

https://www.cnbc.com/2022/06/14/starbucks-union-company-threatens-that-unionizing-could-jeopardize-gender-affirming-health-care.html

But the workers held fast and after years of this, Starbucks has caved, promising contracts for all unionized stores and an end to its campaign of terror against workers seeking to unionize more of its stores. In a postmortem for Jacobin, Eric Blanc rounds up "seven lessons from Starbucks workers' historic victory":

https://jacobin.com/2024/02/starbucks-sbwu-contract-bargaining/

This is the kind of listicle I can get behind. According to Blanc, the Starbucks unions won by deploying worker-to-worker organizing, a tactic that many of the new unions that are shaking up formerly impossible-to-organize jobsites are using (Blanc has a book about this coming from UC Press called "We Are the Union: How Worker-to-Worker Unionism Can Transform America," so he should know).

Other tactics that made the difference for Starbucks unions: new digital training and support tools and partnering with established unions for support and infrastructure. Blanc also calls out the success of "salting" – the venerable but largely disused tactic of union organizers applying for a job at a non-union shop in order to organize it.

Blanc also mentions government policy, including the outstanding work of NLRB general counsel Jennifer Abruzzo, a shrewd and committed tactician whose understanding of the technicalities of labor law have let her push for bold measures. For example, in Thrive Pet Care, Abruzzo is arguing that when a company refuses to bargain in good faith for a contract with its union, she can step in and order them to honor the terms of a contract at comparable unionized competitors until they produce a contract of their own:

https://pluralistic.net/2023/09/06/goons-ginks-and-company-finks/#if-blood-be-the-price-of-your-cursed-wealth

Abruzzo is one of several smart, competent tacticians in the Biden administration who are working to kneecap corporate power. Another is Rohit Chopra, chair of the Consumer Finance Protection Bureau, who just announced another bold, important initiative that will help Americans fight corporate corruption and get a fair deal:

https://prospect.org/economy/2024-03-01-public-option-credit-card-shopping/

Chopra is taking aim at credit-card comparison sites that purport to show you where you can get the best deal. If you're an affluent person who doesn't carry a balance, this might not matter to you, but if you're an average working stiff, high interest rates can gobble up a massive share of your paycheck. What's more, credit card margins are higher than they have ever been:

https://www.consumerfinance.gov/about-us/blog/credit-card-interest-rate-margins-at-all-time-high/

The most expensive credit cards come from the big, monopolistic banks, but you wouldn't know it from the leaderboards produced by Credit Karma, NerdWallet, LendingTree, and Bankrate. All of these sites take bribes from the big banks to list their credit cards above those offered by credit unions – who are typically 10% cheaper than the big banks' cards.

The new CFPB rule prohibits this fraudulent ranking, but the Bureau is going even further. They're using their administrative powers to force banks to report their rates to the Bureau, which will publish them on a publicly funded, neutral website – what David Dayen calls "a public option" for shopping for credit cards.

This policy makes a perfect bookend to the last CFPB initiative I wrote about here: a rule that forces banks to allow you to transfer your account to a rival with a couple of simple clicks, importing all your history, payees, and everything else you need to switch to a better bank:

https://pluralistic.net/2023/10/21/let-my-dollars-go/#personal-financial-data-rights

Combine that ease of switching with reliable information on which banks will give you the best deal and you get something that will directly transfer millions and millions of dollars from giant, wildly profitable banks to low-income people who've been tricked into paying them punitive interest rates.

So that's it, this week's linkdump. I promised you I'd end on a high note, and I did it. The world may be full of all kinds of terrible things, but workers and regulators are scoring big, muscular victories in battles where the stakes are real and important. Have a great weekend – we've earned it.

And remember!

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2024/03/02/macedoine/#the-public-option

Image: Stacy (modified) https://www.flickr.com/photos/notahipster/4402860361/

CC BY 2.0 https://creativecommons.org/licenses/by/2.0/

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