Duff Wilson writes for the New York Times. Please note that I changed the title to something less flattering.
BOSTON — In a first-year pharmacology class at Harvard Medical School, Matt Zerden grew wary as the professor promoted the benefits of cholesterol drugs and seemed to belittle a student who asked about side effects.
Mr. Zerden later discovered something by searching online that he began sharing with his classmates. The professor was not only a full-time member of the Harvard Medical faculty, but a paid consultant to 10 drug companies, including five makers of cholesterol treatments.
“I felt really violated,” Mr. Zerden, now a fourth-year student, recently recalled. “Here we have 160 open minds trying to learn the basics in a protected space, and the information he was giving wasn’t as pure as I think it should be.”
Mr. Zerden’s minor stir four years ago has lately grown into a full-blown movement by more than 200 Harvard Medical School students and sympathetic faculty, intent on exposing and curtailing the industry influence in their classrooms and laboratories, as well as in Harvard’s 17 affiliated teaching hospitals and institutes.
They say they are concerned that the same money that helped build the school’s world-class status may in fact be hurting its reputation and affecting its teaching.
The students argue, for example, that Harvard should be embarrassed by the F grade it recently received from the American Medical Student Association, a national group that rates how well medical schools monitor and control drug industry money.
Harvard Medical School’s peers received much higher grades, ranging from the A for the University of Pennsylvania, to B’s received by Stanford, Columbia and New York University, to the C for Yale.
Harvard has fallen behind, some faculty and administrators say, because its teaching hospitals are not owned by the university, complicating reform; because the dean is fairly new and his predecessor was such an industry booster that he served on a pharmaceutical company board; and because a crackdown, simply put, could cost it money or faculty.
Further, the potential embarrassments — a Senate investigation of several medical professors, the F grade, a new state law effective July 1 requiring Massachusetts doctors to disclose corporate gifts over $50 — are only now adding to pressure for change.
The dean, Dr. Jeffrey S. Flier, who says he wants Harvard to catch up with the best practices at other leading medical schools, recently announced a 19-member committee to re-examine his school’s conflict-of-interest policies. The group, which includes three students, is to meet in private on Thursday.
Advising the group will be Dr. David Korn, a former dean of the Stanford Medical School who started work at Harvard about four months ago as vice provost for research. Last year he helped the Association of American Medical Colleges draft a model conflict-of-interest policy for medical schools.
The Harvard students have already secured a requirement that all professors and lecturers disclose their industry ties in class — a blanket policy that has been adopted by no other leading medical school. (One Harvard professor’s disclosure in class listed 47 company affiliations.)
“Harvard needs to live up to its name,” said Kirsten Austad, 24, a first-year Harvard Medical student who is one of the movement’s leaders. “We are really being indoctrinated into a field of medicine that is becoming more and more commercialized.”
David Tian, 24, a first-year Harvard Medical student, said: “Before coming here, I had no idea how much influence companies had on medical education. And it’s something that’s purposely meant to be under the table, providing information under the guise of education when that information is also presented for marketing purposes.”
The students say they worry that pharmaceutical industry scandals in recent years — including some criminal convictions, billions of dollars in fines, proof of bias in research and publishing and false marketing claims — have cast a bad light on the medical profession. And they criticize Harvard as being less vigilant than other leading medical schools in monitoring potential financial conflicts by faculty members.
Dr. Flier says that the Harvard Medical faculty may lead the nation in receiving money from industry, as well as government and charities, and he does not want to tighten the spigot. “One entirely appropriate source, if done properly, is industrial funds,” Dr. Flier said in an interview.
And school officials see corporate support for their faculty as all the more crucial, as the university endowment has lost 22 percent of its value since last July and the recession has caused philanthropic contributors to retrench. The school said it was unable to provide annual measures of the money flow to its faculty, beyond the $8.6 million that pharmaceutical companies contributed last year for basic science research and the $3 million for continuing education classes on campus. Most of the money goes to professors at the Harvard-affiliated teaching hospitals, and the dean’s office does not keep track of the total.
But no one disputes that many individual Harvard Medical faculty members receive tens or even hundreds of thousands of dollars a year through industry consulting and speaking fees. Under the school’s disclosure rules, about 1,600 of 8,900 professors and lecturers have reported to the dean that they or a family member had a financial interest in a business related to their teaching, research or clinical care. The reports show 149 with financial ties to Pfizer and 130 with Merck.
The rules, though, do not require them to report specific amounts received for speaking or consulting, other than broad indications like “more than $30,000.” Some faculty who conduct research have limits of $30,000 in stock and $20,000 a year in fees. But there are no limits on companies’ making outright gifts to faculty — free meals, tickets, trips or the like.
Other blandishments include industry-endowed chairs like the three Harvard created with $8 million from sleep research companies; faculty prizes like the $50,000 award named after Bristol-Myers Squibb, and sponsorships like Pfizer’s $1 million annual subsidy for 20 new M.D.’s in a two-year program to learn clinical investigation and pursue Harvard Master of Medical Science degrees, including classes taught by Pfizer scientists.
Dr. Flier, who became dean 17 months ago, previously received a $500,000 research grant from Bristol-Myers Squibb. He also consulted for three Cambridge biotechnology companies, but says that those relationships have ended and that he has accepted no new industry affiliations.
That is in contrast to his predecessor as dean, Dr. Joseph B. Martin. Harvard’s rules allowed Dr. Martin to sit on the board of the medical products company Baxter International for 5 of the 10 years he led the medical school, supplementing his university salary with up to $197,000 a year from Baxter, according to company filings.
Dr. Martin is still on the medical faculty and is founder and co-chairman of the Harvard NeuroDiscovery Center, which researches degenerative diseases, and actively solicits industry money to do so. Dr. Martin declined any comment.
A smaller rival faction among Harvard’s 750 medical students has circulated a petition signed by about 100 people that calls for “continued interaction between medicine and industry at Harvard Medical School.”
A leader of the group, Vijay Yanamadala, 22, said, “To say that because these industry sources are inherently biased, physicians should never listen to them, is wrong.”
Encouraging them is Dr. Thomas P. Stossel, a Harvard Medical professor who has served on advisory boards for Merck, Biogen Idec and Dyax, and has written widely on academic-industry ties. “I think if you look at it with intellectual honesty, you see industry interaction has produced far more good than harm,” Dr. Stossel said. “Harvard absolutely could get more from industry but I think they’re very skittish. There’s a huge opportunity we ought to mine.”
Brian Fuchs, 26, a second-year student from Queens, credited drug companies with great medical discoveries. “It’s not a problem,” he said, pointing out a classroom window to a 12-story building nearby. “In fact, Merck is right there.”
Merck built a corporate research center in 2004 across the street from Harvard’s own big new medical research and class building. And Merck underwrites plenty of work on the Harvard campus, including the immunology lab run by Dr. Laurie H. Glimcher — a professor who also sits on the board of the drug maker Bristol-Myers Squibb, which paid her nearly $270,000 in 2007.
Dr. Glimcher says industry money is not only appropriate but necessary. “Without the support of the private sector, we would not have been able to develop what I call our ‘bone team’ in our lab,” she said at a recent student and faculty forum to discuss industry relationships. Merck is counting on her team to help come up with a successor to Fosamax, the formerly $3 billion-a-year bone drug that went generic last year. But Dr. Marcia Angell, a faculty member and former editor in chief of The New England Journal of Medicine, is among the professors who argue that industry profit motives do not correspond to the scientific aims of academic medicine and that much of the financing needs to be not only disclosed, but banned. Too many medical schools, she says, have struck a “Faustian bargain” with pharmaceutical companies.
“If a school like Harvard can’t behave itself,” Dr. Angell said, “who can?”
Tuesday, March 03, 2009
Monday, March 02, 2009
US hospitals facing financial stress
Many US hospitals, both for-profit and non-profit, are facing financial stress in this economic recession.
Jeffrey Stafford, writing for the stock and fund analysis firm Morningstar, contends that "Like their patients, hospitals are ill". His report specifically references for-profit hospitals. Under law, all hospitals maintaining an ER must stabilize all patients who present regardless of insurance. Therefore, hospitals undergoing financial stress are a public policy issue, even if they are for-profit hospitals.
Patients are delaying care, at risk to their own health, in this economic environment. This includes insured patients who are underinsured - their insurance excludes their pre-existing conditions, has lifetime benefit caps on a condition considered to be expensive, or has cost-sharing provisions (e.g. premiums, co-pays or co-insurance*) that cause high out of pocket costs.
In addition to the insurance issue, US hospitals must keep track of their payer mix. Medicaid, the program for the poor, and Medicare, the program for the elderly, generally reimburse hospitals below the latter's cost of providing the care. Medicaid pays more poorly than Medicare. Of course, Medicaid is preferable to having an uninsured patient, since a hospital will get reimbursed little, if at all. Medicaid is generally a prime target for state governments to cut; in their defense, Medicaid expenses have grown considerably and are often a strain on state budgets.
For better and for worse, hospitals rely on privately insured patients to generate their operating margins. Essentially, they shift costs to the private insurers. All told, the payer mix at all US hospitals is deteriorating - more uninsured and Medicaid patients are showing up.
All hospitals have a high degree of what is known as operational leverage. Their fixed costs (as opposed to variable costs) are relatively high, since they have to stay open no matter what. Declines in patient volume affect their bottom lines severely.
US hospitals rely heavily on debt to finance their operations. These days, it is very difficult to raise debt at a reasonable price unless (and sometimes even if) a company has an excellent credit rating. Any hospitals that need to raise debt will have problems doing so at reasonable rates. Normally, non-profits can raise debt at better rates, since their bonds are usually tax-free and can offer lower interest rates. However, the tax-free debt market is facing similar stresses.
US nonprofits face many of the same stresses. The Michigan Health and Hospital Association documents similar problems to for-profits. US non-profit hospitals can take donations and usually have endowments, so they face the additional challenge of significantly declining donations and endowments that have half vanished with the stock market. This can be a big problem, since nonprofits often draw regularly on their endowments and charitable donations.
* Co-pay: flat fee that you pay when you access a service or get a prescription drug. May vary, e.g. a copay of $5 for generic drugs or $10 for branded.
Co-insurance: same as the above, but a percentage fee, e.g. 10% co-insurance for hospital visits.
Jeffrey Stafford, writing for the stock and fund analysis firm Morningstar, contends that "Like their patients, hospitals are ill". His report specifically references for-profit hospitals. Under law, all hospitals maintaining an ER must stabilize all patients who present regardless of insurance. Therefore, hospitals undergoing financial stress are a public policy issue, even if they are for-profit hospitals.
Patients are delaying care, at risk to their own health, in this economic environment. This includes insured patients who are underinsured - their insurance excludes their pre-existing conditions, has lifetime benefit caps on a condition considered to be expensive, or has cost-sharing provisions (e.g. premiums, co-pays or co-insurance*) that cause high out of pocket costs.
In addition to the insurance issue, US hospitals must keep track of their payer mix. Medicaid, the program for the poor, and Medicare, the program for the elderly, generally reimburse hospitals below the latter's cost of providing the care. Medicaid pays more poorly than Medicare. Of course, Medicaid is preferable to having an uninsured patient, since a hospital will get reimbursed little, if at all. Medicaid is generally a prime target for state governments to cut; in their defense, Medicaid expenses have grown considerably and are often a strain on state budgets.
For better and for worse, hospitals rely on privately insured patients to generate their operating margins. Essentially, they shift costs to the private insurers. All told, the payer mix at all US hospitals is deteriorating - more uninsured and Medicaid patients are showing up.
All hospitals have a high degree of what is known as operational leverage. Their fixed costs (as opposed to variable costs) are relatively high, since they have to stay open no matter what. Declines in patient volume affect their bottom lines severely.
US hospitals rely heavily on debt to finance their operations. These days, it is very difficult to raise debt at a reasonable price unless (and sometimes even if) a company has an excellent credit rating. Any hospitals that need to raise debt will have problems doing so at reasonable rates. Normally, non-profits can raise debt at better rates, since their bonds are usually tax-free and can offer lower interest rates. However, the tax-free debt market is facing similar stresses.
US nonprofits face many of the same stresses. The Michigan Health and Hospital Association documents similar problems to for-profits. US non-profit hospitals can take donations and usually have endowments, so they face the additional challenge of significantly declining donations and endowments that have half vanished with the stock market. This can be a big problem, since nonprofits often draw regularly on their endowments and charitable donations.
* Co-pay: flat fee that you pay when you access a service or get a prescription drug. May vary, e.g. a copay of $5 for generic drugs or $10 for branded.
Co-insurance: same as the above, but a percentage fee, e.g. 10% co-insurance for hospital visits.
A sign of hope for Anglicanism: Burundian and Canadian provinces continue joint activities, oppose border crossings
The Anglican church of Burundi opposes same-sex marriage. The church of Canada is considering it, and several of its Dioceses clearly support same-sex marriage. Other African provinces have engaged in border-crossing, having ordained priests in Canada or having poached Canadian churches that have defected.
However, Anglican Journal reports that Canada and Burundi are increasing their mission-related ties. They have also agreed that there will be no unauthorized border crossings between their churches.
I believe Jesus calls us to work with those with whom we disagree.
However, Anglican Journal reports that Canada and Burundi are increasing their mission-related ties. They have also agreed that there will be no unauthorized border crossings between their churches.
I believe Jesus calls us to work with those with whom we disagree.
Saturday, February 28, 2009
In one town, recession helps bridge cultural rift
Emily Maltby writes for CNN Money.
Framingham's immigrants always felt like outsiders. Then the downturn forced the town's planners and entrepreneurs to work together to save imperiled businesses.
FRAMINGHAM, MASS. (CNNMoney.com) -- The recession has hit Framingham, Mass., like an earthquake, shaking local businesses and thinning their numbers. But the town's merchants have found one silver lining in the economic calamity: It's forcing them to tackle a festering problem.
Culture clashes were easily ignored when the economy was strong. But now, the shops lining Concord Street, Framingham's main artery, can't move forward unless they address the decade-old problems head-on.
Like people all around the U.S., Framingham's residents started feeling the pinch last year, after the housing market began deteriorating. But the town seemed well positioned to ride out the downturn: After being hit hard by the recessions in the early '90s, when Framingham's unemployment rate topped 27%, the town rose from the ashes and restructured its economy. A statewide program to stimulate job creation in distressed areas worked well in Framingham, turning the town into a thriving business center for companies in a range of industries.
With that growth came a boom in foreign immigrants, drawn to Framingham for the economic opportunities it offered. In a town of 65,000, the 2000 census recorded 4,400 Brazil-born residents. Town planners estimate that 15% to 20% of the current local population hails from Brazil.
Many of the immigrants, such as Pablo Maia, established businesses. Maia opened a real estate company in 1999 to serve the growing Brazilian community, and hired 17 employees to help him run it.
By 2007, Framingham's businesses supported more than 45,000 jobs and a payroll of $3 billion. The town headquarters household names like electronics trendsetter Bose, office-supplies giant Staples (SPLS, Fortune 500), and retailer TJX (TJX, Fortune 500), the parent company behind TJ Maxx and Marshalls. Behind them are more than 2,000 small businesses, each with a handful of employees.
The town's economic diversity should make it resilient. But Framingham's ethnic diversity had caused a schism in the community.
9 Framingham stores: How we're coping
Some are supportive of the town's abundance of Brazilian startups. "The immigrants work really hard and help supply the local economy with a variety of businesses, from bakeries to retail to clothing shops," says State Senator Karen Spilka, who represents Massachusetts's 2nd district.
But many longtime residents worried about illegal immigration. Others were concerned that the downtown area was becoming exclusionary, with signs written only in Portuguese and window displays primarily showcasing Brazilian goods.
"There was a definite disconnect between the Brazilians and Americans. It was a culture gap, which just kept widening," recalls Ilma Paixao, a longtime resident of Framingham and native of Brazil who has studied the dynamic of the Brazilian community at MIT's Department of Urban Studies and Planning.
City planners tried to bridge the gap, but had little success.
"My predecessors made countless attempts to organize and mobilize the downtown merchants, and they were constantly met with failure," says Alison Steinfeld, who assumed the position of director of Framingham's Community and Economic Development office less than a year ago. The town held workshops to help the Brazilian community learn English and sessions to assist them with marketing to Americans, but found little interest.
"We didn't know about the meetings," counters Zalca Nubia Gaseta, who has run Party Flowers on Concord Street with her husband Roberto for the past 12 years. "Maybe that's because no Americans came downtown. To them, it was a scary place. We paid our taxes, so we would have liked the education, but we never got any letter or other type of communication - nothing."
There may have been another reason that the town hall meeting rooms were vacant. "The owners were intimidated to come because they felt they'd just be attacked," says Paixao. "They thought it best to pay their taxes, cause no trouble, and keep their heads down." It's the same reason, Paixao says, that many Brazilian business owners rely on their own cash rather than lines of credits from lending institutions.
Layoffs and bankruptcies
That fear wasn't going to go away as long as the economy kept humming. In its own segregated fashion, commerce seemed to be moving forward just fine in Framingham. With the exception of those in the housing industry - such as Maia Realty, which started shedding employees in late 2008 - the businesses on Concord Street didn't yet feel financially pressured.
But as winter settled in, the lack of consumer confidence became apparent. Along the major roads that surround the center of town, large retailers such as Circuit City and Filene's Basement held liquidation sales and prepared to shut down.
Then things got worse. Bose cut its global workforce by 10%. Staples announced that 140 workers would be laid off, including half from its home office. Multicolor, an Ohio company that had a manufacturing facility in Framingham, consolidated its operations into another town and dropped 62 regional employees.
Though Framingham's unemployment rate has remained below the national and state levels, the community is feeling the pain. "We have a solid base," says Senator Spilka. "The economic diversity does help us, [but] we're not recession-proof by any means."
"If you're laid off, you're not buying lunch. It's the multiplier effect in economics. Every dollar works more than once. So as you see layoffs, they will ripple through the community," says Professor Maureen Dunne, who helps run the MetroWest Economic Research Center at Framingham State College's Department of Economics and Business Administration.
That meant bad news for the town's small businesses.
"Small businesses are adaptable, because they can get direct information daily, whereas large businesses have to wait until the end of the month or the end of the quarter for that to happen," explains Dunne. "When restaurants see people aren't coming in Monday through Wednesday, they can move quickly to get them in. They can get feedback immediately by asking customers directly what they want. A lower price? A different menu? Then, they can turn on a heel to address that."
In many towns, that's true. But on Concord Street, it's a little more complicated. Businesses there have had less success implementing new sales tactics in recent months because of the underlying cultural problem. Americans didn't go to the Brazilian stores even when the economy was good. But anecdotal evidence suggests that the Brazilian community - the owners' primary consumer base - is starting to decline in tandem with the economy. The area is not offering them the opportunity it once did.
"A lot of people lost interest and started to go back," says Maia. "It's a rapidly developing country, and there are now many opportunities there today in a way that wasn't the case years ago. So if the economy is bad, they may as well stay in Brazil."
The merchants realized they had a serious problem. Party Flowers owner Gaseta decided to form a business owners' association.
The first meeting was a small gathering in October of eight business owners who wanted to share their concerns. By November, MIT's Paixao had joined the group. In December, Paixao invited Steinfeld to the meeting, which had grown to 25 business owners.
That invitation opened up one of the first direct lines of communications between Framingham's downtown entrepreneurs and the town's business development officers.
"They started talking about what they had to do," recalls Steinfeld. "For the first time I was able to hear what their problems were and to reinforce that the town is here to help."
Paixao realized that, following that meeting, the owners were finally able to understand the power of being involved in Framingham's civic planning.
The annual Christmas tree lighting ceremony was the first event that Town Hall promoted following the inception of the association. "I don't think the business owners would have been open, because they wouldn't have been aware that all these residents came out for that event," says Paixao.
That night, some of the owners set up a table in the Town Hall to hand out fliers, while others manned the stores. "Once we established that communication, they had the opportunity to reach out to a lot of traffic," adds Paixao.
"We're doing whatever we can to help them survive," says Steinfeld. "Unfortunately, we can't make people spend money. But what we can do, to the extent possible, is identify town activities that are happening and notify the merchants so that they can mobilize and take advantage of those consumers."
Marketing and other workshops - a collaborative effort between MIT, the town, and the Small Business Administration's SCORE program - have been well attended, according to Paixao. The owners are reacting by changing their window displays and hiring English-speaking employees.
At the Old Station Steakhouse, for example, the emphasis is on the Brazilian cuisine, but the founders have made a conscious effort to keep the signage in English and Portuguese and offer a buffet with a variety of American comfort food options.
"We want to cater to both the Brazilians and the Americans. If we served just Brazilian food, we would be missing out on a lot of customers," says Early Barbosa, one of the Brazilian founders. He and three other partners pooled their money to get the restaurant established eight months ago without any bank loans.
"And actually, a lot of the time, when the Americans come in and see the Brazilian barbeque, they end up liking it better," he laughs.
Hoping for a stimulus jolt
The 50-member strong association, while building community among the owners - eight non-Brazilian business owners have recently joined - has not yet brought relief to their businesses. Gaseta said that Valentine's Day sales at her shop were half of what they were last year. Still, the fact that she's starting to see more people stopping by keeps her optimistic.
"I realize money is the biggest problem, and I don't care if they don't buy anything," she says. "I just want them to know I'm there and that they can come in to say hi."
The cultural gap isn't closed yet, either. Gaseta's flower business, which also provides services such as photography and video for special events, does 20 Brazilian weddings for every one American wedding. "It's step by step with the Americans, but I have hope things will get better."
Because so many small businesses in Framingham provide products and services to the larger ones, it's going to take major action to get the business dynamic back up to where it was, Spilka believes.
"I'm hoping that with the trickle-down of the stimulus, that will really help to get things moving sooner rather than later," she says.
Economic development officer Steinfeld is also counting on stimulus-funded infrastructure spending to help boost the city's economy.
"We have $8 million worth of improvements scheduled, and hopefully the economic stimulus will help us implement some of those plans to improve circulation, traffic and pedestrian, and beautify the downtown," she says. "We're doing whatever we can to help them survive, because small merchants are critical to the success of the downtown."
The business association will also be doing whatever it can to help its members pull through. After years of strain, Framingham's diverse entrepreneurs and civic planners are finally finding ways to work together on their common problems.
"Obviously everyone would prefer that the recession weren't here, and we want it over as soon as possible," Steinfeld says. "But the way we look at it is now is the time to set the framework, so that whenever the recession starts to ebb, we'll be prepared." To top of page
Framingham's immigrants always felt like outsiders. Then the downturn forced the town's planners and entrepreneurs to work together to save imperiled businesses.
FRAMINGHAM, MASS. (CNNMoney.com) -- The recession has hit Framingham, Mass., like an earthquake, shaking local businesses and thinning their numbers. But the town's merchants have found one silver lining in the economic calamity: It's forcing them to tackle a festering problem.
Culture clashes were easily ignored when the economy was strong. But now, the shops lining Concord Street, Framingham's main artery, can't move forward unless they address the decade-old problems head-on.
Like people all around the U.S., Framingham's residents started feeling the pinch last year, after the housing market began deteriorating. But the town seemed well positioned to ride out the downturn: After being hit hard by the recessions in the early '90s, when Framingham's unemployment rate topped 27%, the town rose from the ashes and restructured its economy. A statewide program to stimulate job creation in distressed areas worked well in Framingham, turning the town into a thriving business center for companies in a range of industries.
With that growth came a boom in foreign immigrants, drawn to Framingham for the economic opportunities it offered. In a town of 65,000, the 2000 census recorded 4,400 Brazil-born residents. Town planners estimate that 15% to 20% of the current local population hails from Brazil.
Many of the immigrants, such as Pablo Maia, established businesses. Maia opened a real estate company in 1999 to serve the growing Brazilian community, and hired 17 employees to help him run it.
By 2007, Framingham's businesses supported more than 45,000 jobs and a payroll of $3 billion. The town headquarters household names like electronics trendsetter Bose, office-supplies giant Staples (SPLS, Fortune 500), and retailer TJX (TJX, Fortune 500), the parent company behind TJ Maxx and Marshalls. Behind them are more than 2,000 small businesses, each with a handful of employees.
The town's economic diversity should make it resilient. But Framingham's ethnic diversity had caused a schism in the community.
9 Framingham stores: How we're coping
Some are supportive of the town's abundance of Brazilian startups. "The immigrants work really hard and help supply the local economy with a variety of businesses, from bakeries to retail to clothing shops," says State Senator Karen Spilka, who represents Massachusetts's 2nd district.
But many longtime residents worried about illegal immigration. Others were concerned that the downtown area was becoming exclusionary, with signs written only in Portuguese and window displays primarily showcasing Brazilian goods.
"There was a definite disconnect between the Brazilians and Americans. It was a culture gap, which just kept widening," recalls Ilma Paixao, a longtime resident of Framingham and native of Brazil who has studied the dynamic of the Brazilian community at MIT's Department of Urban Studies and Planning.
City planners tried to bridge the gap, but had little success.
"My predecessors made countless attempts to organize and mobilize the downtown merchants, and they were constantly met with failure," says Alison Steinfeld, who assumed the position of director of Framingham's Community and Economic Development office less than a year ago. The town held workshops to help the Brazilian community learn English and sessions to assist them with marketing to Americans, but found little interest.
"We didn't know about the meetings," counters Zalca Nubia Gaseta, who has run Party Flowers on Concord Street with her husband Roberto for the past 12 years. "Maybe that's because no Americans came downtown. To them, it was a scary place. We paid our taxes, so we would have liked the education, but we never got any letter or other type of communication - nothing."
There may have been another reason that the town hall meeting rooms were vacant. "The owners were intimidated to come because they felt they'd just be attacked," says Paixao. "They thought it best to pay their taxes, cause no trouble, and keep their heads down." It's the same reason, Paixao says, that many Brazilian business owners rely on their own cash rather than lines of credits from lending institutions.
Layoffs and bankruptcies
That fear wasn't going to go away as long as the economy kept humming. In its own segregated fashion, commerce seemed to be moving forward just fine in Framingham. With the exception of those in the housing industry - such as Maia Realty, which started shedding employees in late 2008 - the businesses on Concord Street didn't yet feel financially pressured.
But as winter settled in, the lack of consumer confidence became apparent. Along the major roads that surround the center of town, large retailers such as Circuit City and Filene's Basement held liquidation sales and prepared to shut down.
Then things got worse. Bose cut its global workforce by 10%. Staples announced that 140 workers would be laid off, including half from its home office. Multicolor, an Ohio company that had a manufacturing facility in Framingham, consolidated its operations into another town and dropped 62 regional employees.
Though Framingham's unemployment rate has remained below the national and state levels, the community is feeling the pain. "We have a solid base," says Senator Spilka. "The economic diversity does help us, [but] we're not recession-proof by any means."
"If you're laid off, you're not buying lunch. It's the multiplier effect in economics. Every dollar works more than once. So as you see layoffs, they will ripple through the community," says Professor Maureen Dunne, who helps run the MetroWest Economic Research Center at Framingham State College's Department of Economics and Business Administration.
That meant bad news for the town's small businesses.
"Small businesses are adaptable, because they can get direct information daily, whereas large businesses have to wait until the end of the month or the end of the quarter for that to happen," explains Dunne. "When restaurants see people aren't coming in Monday through Wednesday, they can move quickly to get them in. They can get feedback immediately by asking customers directly what they want. A lower price? A different menu? Then, they can turn on a heel to address that."
In many towns, that's true. But on Concord Street, it's a little more complicated. Businesses there have had less success implementing new sales tactics in recent months because of the underlying cultural problem. Americans didn't go to the Brazilian stores even when the economy was good. But anecdotal evidence suggests that the Brazilian community - the owners' primary consumer base - is starting to decline in tandem with the economy. The area is not offering them the opportunity it once did.
"A lot of people lost interest and started to go back," says Maia. "It's a rapidly developing country, and there are now many opportunities there today in a way that wasn't the case years ago. So if the economy is bad, they may as well stay in Brazil."
The merchants realized they had a serious problem. Party Flowers owner Gaseta decided to form a business owners' association.
The first meeting was a small gathering in October of eight business owners who wanted to share their concerns. By November, MIT's Paixao had joined the group. In December, Paixao invited Steinfeld to the meeting, which had grown to 25 business owners.
That invitation opened up one of the first direct lines of communications between Framingham's downtown entrepreneurs and the town's business development officers.
"They started talking about what they had to do," recalls Steinfeld. "For the first time I was able to hear what their problems were and to reinforce that the town is here to help."
Paixao realized that, following that meeting, the owners were finally able to understand the power of being involved in Framingham's civic planning.
The annual Christmas tree lighting ceremony was the first event that Town Hall promoted following the inception of the association. "I don't think the business owners would have been open, because they wouldn't have been aware that all these residents came out for that event," says Paixao.
That night, some of the owners set up a table in the Town Hall to hand out fliers, while others manned the stores. "Once we established that communication, they had the opportunity to reach out to a lot of traffic," adds Paixao.
"We're doing whatever we can to help them survive," says Steinfeld. "Unfortunately, we can't make people spend money. But what we can do, to the extent possible, is identify town activities that are happening and notify the merchants so that they can mobilize and take advantage of those consumers."
Marketing and other workshops - a collaborative effort between MIT, the town, and the Small Business Administration's SCORE program - have been well attended, according to Paixao. The owners are reacting by changing their window displays and hiring English-speaking employees.
At the Old Station Steakhouse, for example, the emphasis is on the Brazilian cuisine, but the founders have made a conscious effort to keep the signage in English and Portuguese and offer a buffet with a variety of American comfort food options.
"We want to cater to both the Brazilians and the Americans. If we served just Brazilian food, we would be missing out on a lot of customers," says Early Barbosa, one of the Brazilian founders. He and three other partners pooled their money to get the restaurant established eight months ago without any bank loans.
"And actually, a lot of the time, when the Americans come in and see the Brazilian barbeque, they end up liking it better," he laughs.
Hoping for a stimulus jolt
The 50-member strong association, while building community among the owners - eight non-Brazilian business owners have recently joined - has not yet brought relief to their businesses. Gaseta said that Valentine's Day sales at her shop were half of what they were last year. Still, the fact that she's starting to see more people stopping by keeps her optimistic.
"I realize money is the biggest problem, and I don't care if they don't buy anything," she says. "I just want them to know I'm there and that they can come in to say hi."
The cultural gap isn't closed yet, either. Gaseta's flower business, which also provides services such as photography and video for special events, does 20 Brazilian weddings for every one American wedding. "It's step by step with the Americans, but I have hope things will get better."
Because so many small businesses in Framingham provide products and services to the larger ones, it's going to take major action to get the business dynamic back up to where it was, Spilka believes.
"I'm hoping that with the trickle-down of the stimulus, that will really help to get things moving sooner rather than later," she says.
Economic development officer Steinfeld is also counting on stimulus-funded infrastructure spending to help boost the city's economy.
"We have $8 million worth of improvements scheduled, and hopefully the economic stimulus will help us implement some of those plans to improve circulation, traffic and pedestrian, and beautify the downtown," she says. "We're doing whatever we can to help them survive, because small merchants are critical to the success of the downtown."
The business association will also be doing whatever it can to help its members pull through. After years of strain, Framingham's diverse entrepreneurs and civic planners are finally finding ways to work together on their common problems.
"Obviously everyone would prefer that the recession weren't here, and we want it over as soon as possible," Steinfeld says. "But the way we look at it is now is the time to set the framework, so that whenever the recession starts to ebb, we'll be prepared." To top of page
Friday, February 27, 2009
War on the rich in America
Some folks act like increased taxes are a war on the rich.
President Obama proposed to hike the top two tax brackets. Tax brackets work incrementally. If you are in, say, the now 35% bracket (soon to be hiked to 39.6%), every dollar you make above the limit for that bracket is taxed at 39.6%. Additionally, capital gains taxes are being increased and deductions for charitable contributions and mortgage interest are being decreased.
The mortgage interest deduction, by the way, favors the rich. Americans get a standard deduction of about $5,000 per individual. You take your gross income and subtract the standard deduction, and then your tax brackets apply. People may also itemize deductions, meaning that they'd add up mortgage interest, charitable contributions and other allowable deductions. You can see how the mortgage deduction, then, is regressive - the more house you have, the more you get to deduct.
Either way, Americans making over $250,000 stand to see a tax hike - possibly a significant one. The New York Times has a couple of interviews with some folks who make about or over $250,000.
One guy said that the national situation was dire enough that he'd suck it up.
One guy said "socialism." One woman asked, "I don't believe in giving money to people who can't afford to buy a house. Why should we pay for someone who is irresponsible?" Another woman asked, "I work 10 to 12 hours a day. What is the reward for someone like me to work harder?"
To be fair, $250,000 means quite different things depending on where in the US you are. In New York, Washington DC or Boston, for example, it's not that much money (although it's hard to starve on that much). In addition, Americans pay state and local taxes on top of Federal ones, and they can be quite high. In the Southern states, $250k is quite a bit more, and state and local taxes are lower.
In addition, it is not good to raise taxes in a recession. Progressives should not ignore the fact that tax hikes will reduce personal spending and investment - both of which can prolong recessions.
That said, I have little sympathy for the folks who cry socialism or who try to complain there's some sort of war on the rich. The opportunities to make money in the United States are tremendous. Even in Europe, where the "socialism" canard is more applicable, the opportunities are tremendous. If you think a few percentage points of tax hike somehow takes away your incentive to work, then you don't have to work.
PS: I believe the tax increases are only scheduled to start in 2011 anyway. Granted the US economy may still be in recession, but it's likely to be in better shape than today.
President Obama proposed to hike the top two tax brackets. Tax brackets work incrementally. If you are in, say, the now 35% bracket (soon to be hiked to 39.6%), every dollar you make above the limit for that bracket is taxed at 39.6%. Additionally, capital gains taxes are being increased and deductions for charitable contributions and mortgage interest are being decreased.
The mortgage interest deduction, by the way, favors the rich. Americans get a standard deduction of about $5,000 per individual. You take your gross income and subtract the standard deduction, and then your tax brackets apply. People may also itemize deductions, meaning that they'd add up mortgage interest, charitable contributions and other allowable deductions. You can see how the mortgage deduction, then, is regressive - the more house you have, the more you get to deduct.
Either way, Americans making over $250,000 stand to see a tax hike - possibly a significant one. The New York Times has a couple of interviews with some folks who make about or over $250,000.
One guy said that the national situation was dire enough that he'd suck it up.
One guy said "socialism." One woman asked, "I don't believe in giving money to people who can't afford to buy a house. Why should we pay for someone who is irresponsible?" Another woman asked, "I work 10 to 12 hours a day. What is the reward for someone like me to work harder?"
To be fair, $250,000 means quite different things depending on where in the US you are. In New York, Washington DC or Boston, for example, it's not that much money (although it's hard to starve on that much). In addition, Americans pay state and local taxes on top of Federal ones, and they can be quite high. In the Southern states, $250k is quite a bit more, and state and local taxes are lower.
In addition, it is not good to raise taxes in a recession. Progressives should not ignore the fact that tax hikes will reduce personal spending and investment - both of which can prolong recessions.
That said, I have little sympathy for the folks who cry socialism or who try to complain there's some sort of war on the rich. The opportunities to make money in the United States are tremendous. Even in Europe, where the "socialism" canard is more applicable, the opportunities are tremendous. If you think a few percentage points of tax hike somehow takes away your incentive to work, then you don't have to work.
PS: I believe the tax increases are only scheduled to start in 2011 anyway. Granted the US economy may still be in recession, but it's likely to be in better shape than today.
Thursday, February 26, 2009
After abuse, changes in the brain
Benedict Carey reports for the NY Times.
For years, psychiatrists have known that children who are abused or neglected run a high risk of developing mental problems later in life, from anxiety and depression to substance abuse and suicide.
The connection is not surprising, but it raises a crucial scientific question: Does the abuse cause biological changes that may increase the risk for these problems?
Over the past decade or so, researchers at McGill University in Montreal, led by Michael Meaney, have shown that affectionate mothering alters the expression of genes in animals, allowing them to dampen their physiological response to stress. These biological buffers are then passed on to the next generation: rodents and nonhuman primates biologically primed to handle stress tend to be more nurturing to their own offspring, Dr. Meaney and other researchers have found.
Now, for the first time, they have direct evidence that the same system is at work in humans. In a study of people who committed suicide published Sunday in the journal Nature Neuroscience, researchers in Montreal report that people who were abused or neglected as children showed genetic alterations that likely made them more biologically sensitive to stress.
The findings help clarify the biology behind the wounds of a difficult childhood and hint at what constitutes resilience in those able to shake off such wounds.
The study “extends the animal work on the regulation of stress to humans in a dramatic way,” Jaak Panksepp, an adjunct professor at Washington State University who was not involved in the research, wrote in an e-mail message.
He added that the study “suggests pathways that have promoted the psychic pain that makes life intolerable,” and continued, “It’s a wonderful example of how the study of animal models of emotional resilience can lead the way to understanding human vicissitudes.”
In the study, scientists at McGill and the Singapore Institute for Clinical Sciences compared the brains of 12 people who had committed suicide and who had had difficult childhoods with 12 people who had committed suicide and who had not suffered abuse or neglect as children.
The scientists determined the nature of the subjects’ upbringing by doing extensive interviews with next of kin, as well as investigating medical records. The brains are preserved at Douglas Hospital in Montreal as part of the Quebec Suicide Brain Bank, a program founded by McGill researchers to promote suicide studies that receives brain donations from around the province.
When people are under stress, the hormone cortisol circulates widely, putting the body on high alert. One way the brain reduces this physical anxiety is to make receptors on brain cells that help clear the cortisol, inhibiting the distress and protecting neurons from extended exposure to the hormone, which can be damaging.
The researchers found that the genes that code for these receptors were about 40 percent less active in people who had been abused as children than in those who had not. The scientists found the same striking differences between the abused group and the brains of 12 control subjects, who had not been abused and who died from causes other than suicide. “It is good evidence that the same systems are at work in humans that we have seen in other animals,” said Patrick McGowan, a postdoctoral fellow in Dr. Meaney’s lab at McGill and the lead author of the study.
His co-authors, along with Dr. Meaney, were Aya Sasaki, Ana C. D’Alessio, Sergiy Dymov, Benoît Labonté and Moshe Szyf, all of McGill, and Dr. Gustavo Turecki, a McGill researcher who leads the Brain Bank.
Because of individual differences in the genetic machinery that regulates stress response, experts say, many people manage their distress despite awful childhoods. Others may find solace in other people, which helps them regulate the inevitable pain of living a full life.
“The bottom line is that this is a terrific line of work, but there is a very long way to go either to understand the effects of early experience or the causes of mental disorders,” Dr. Steven Hyman, a professor of neurobiology at Harvard, wrote in an e-mail message.
For years, psychiatrists have known that children who are abused or neglected run a high risk of developing mental problems later in life, from anxiety and depression to substance abuse and suicide.
The connection is not surprising, but it raises a crucial scientific question: Does the abuse cause biological changes that may increase the risk for these problems?
Over the past decade or so, researchers at McGill University in Montreal, led by Michael Meaney, have shown that affectionate mothering alters the expression of genes in animals, allowing them to dampen their physiological response to stress. These biological buffers are then passed on to the next generation: rodents and nonhuman primates biologically primed to handle stress tend to be more nurturing to their own offspring, Dr. Meaney and other researchers have found.
Now, for the first time, they have direct evidence that the same system is at work in humans. In a study of people who committed suicide published Sunday in the journal Nature Neuroscience, researchers in Montreal report that people who were abused or neglected as children showed genetic alterations that likely made them more biologically sensitive to stress.
The findings help clarify the biology behind the wounds of a difficult childhood and hint at what constitutes resilience in those able to shake off such wounds.
The study “extends the animal work on the regulation of stress to humans in a dramatic way,” Jaak Panksepp, an adjunct professor at Washington State University who was not involved in the research, wrote in an e-mail message.
He added that the study “suggests pathways that have promoted the psychic pain that makes life intolerable,” and continued, “It’s a wonderful example of how the study of animal models of emotional resilience can lead the way to understanding human vicissitudes.”
In the study, scientists at McGill and the Singapore Institute for Clinical Sciences compared the brains of 12 people who had committed suicide and who had had difficult childhoods with 12 people who had committed suicide and who had not suffered abuse or neglect as children.
The scientists determined the nature of the subjects’ upbringing by doing extensive interviews with next of kin, as well as investigating medical records. The brains are preserved at Douglas Hospital in Montreal as part of the Quebec Suicide Brain Bank, a program founded by McGill researchers to promote suicide studies that receives brain donations from around the province.
When people are under stress, the hormone cortisol circulates widely, putting the body on high alert. One way the brain reduces this physical anxiety is to make receptors on brain cells that help clear the cortisol, inhibiting the distress and protecting neurons from extended exposure to the hormone, which can be damaging.
The researchers found that the genes that code for these receptors were about 40 percent less active in people who had been abused as children than in those who had not. The scientists found the same striking differences between the abused group and the brains of 12 control subjects, who had not been abused and who died from causes other than suicide. “It is good evidence that the same systems are at work in humans that we have seen in other animals,” said Patrick McGowan, a postdoctoral fellow in Dr. Meaney’s lab at McGill and the lead author of the study.
His co-authors, along with Dr. Meaney, were Aya Sasaki, Ana C. D’Alessio, Sergiy Dymov, Benoît Labonté and Moshe Szyf, all of McGill, and Dr. Gustavo Turecki, a McGill researcher who leads the Brain Bank.
Because of individual differences in the genetic machinery that regulates stress response, experts say, many people manage their distress despite awful childhoods. Others may find solace in other people, which helps them regulate the inevitable pain of living a full life.
“The bottom line is that this is a terrific line of work, but there is a very long way to go either to understand the effects of early experience or the causes of mental disorders,” Dr. Steven Hyman, a professor of neurobiology at Harvard, wrote in an e-mail message.
Personal follow up to how we die
First, I'd rather go quickly. I guess that means cancer, although I assume that dying in one's sleep leads to a similar health profile.
To recap, about 20% of Americans die of cancer. Deaths here peak around age 65.
Organ failure kills about 25% of Americans, and peaks around age 75.
Slow decline kills about 40% of Americans, a lot of them beyond age 85.
Other rich countries can expect similar results, except that Americans tend to have a comparatively high rate of chronic diseases. Presumably a lot of these end in death type 2. Better prevention and treatment of chronic diseases should reduce the number of such deaths. America will reform her health care system, and she will better prevent and treat chronic diseases in the future.
Presumably, that leaves more people dying from slow decline. That adds a financial burden to families and individuals. Given that American families are decreasing in average size, that's more burden shared by fewer individuals.
Long term care insurance is still young in the US. You need to buy it early. You need to pick an established name that you're sure will be around for a long time (snide remark: in this financial crisis, who knows how many insurers will go under?).
A large part of LTC financing in the US is done through Medicaid - which is supposed to finance medical and public health services for the poor. The elderly often need to spend their incomes down to qualify for Medicaid. One has to ask if they're crowding out the actual poor, since LTC is expensive.
In aggregate, the US spent around 36.6% of the FY 2006 Medicaid budget on LTC. Hat tip to the Kaiser Foundation's State Health Facts. LTC is not solely used by the elderly - I'm a brain injury survivor and had to use some LTC services - but most of it is. Kaiser's data shows that the US spent 43.7% of Medicaid LTC dollars on nursing homes, which are mostly used by the elderly and 40% of Medicaid LTC dollars on home and community based services, which are mostly used by the elderly.
Medicare is very acute-care oriented. It pays for almost no LTC services (except, I believe, nursing home care shortly after hospital discharge). Yet, since Medicare serves the elderly, it would make sense, organizationally, to put LTC services in Medicare.
The US has not thought of a coherent way to pay for long term care services. It will need to do so. In Singapore, LTC services are paid out of pocket. Family members become caregivers. They also hire maids from countries like Indonesia and the Philippines; Singapore has no minimum wage law, and the maids are paid what some would see as near-slave wages. Singapore's LTC insurance market does not, to my knowledge, exist yet. I'm not sure that's a coherent response, either.
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