Citizens Insurance planned to use our premiums to make GIFTS to private insurance companies. Well, it seems the bright boyos at Citizens paid Goldman Sachs a great deal of money to explain how it would work, and they explained that it wouldn’t work as none of the potential participants were solvent enough to be trusted with any money, so the plan is off the table at least for this year. See The Buzz for the details, Citizens to abandon loan program for private companies, floats new ‘clearinghouse’ idea. (How do I know Goldman Sachs was paid a lot of money when the article doesn’t say? Simple: it’s Goldman Sachs.)
I have a knee-jerk distrust of arguments (especially around election time) that seem so nakedly calculated to reinforce liberal biases, but the source commands some respect, and it is based on some research. Perlstein is the author of Nixonland, one of the rare truly great books about Nixon and his times. (Two other great Nixon books I’ve read are William Safire’s Before the Fall and Garry Wills’s Nixon Agonisties.) His piece is worth a read, and I say that as someone who pretty much stopped reading Crooks & Liars a couple of weeks ago because the constant theme about how absolutely everything the GOP does is dishonest started feeling tiresome and shrill. (I wouldn’t go over 50%, see how moderate I am!) Perlstein, though, is plausible and palatable:
It’s time, in other words, to consider whether Romney’s fluidity with the truth is, in fact, a feature and not a bug: a constituent part of his appeal to conservatives. The point here is not just that he lies when he says conservative things, even if he believes something different in his heart of hearts—but that lying is what makes you sound the way a conservative is supposed to sound, in pretty much the same way that curlicuing all around the note makes you sound like a contestant on American Idol is supposed to sound.
In part the New York Times had it right, for as much as it’s worth: Romney’s prevarications are evidence of simple political hucksterism—“short, utterly false sound bites,” repeated “so often that millions of Americans believe them to be the truth.” But the Times misses the bigger picture. Each constituent lie is an instance pointing to a larger, elaborately constructed “truth,” the one central to the right-wing appeal for generations: that liberalism is a species of madness—an esoteric cult of out-of-touch, Europe-besotted ivory tower elites—and conservatism is the creed of regular Americans and vouchsafes the eternal prosperity, security, and moral excellence of God’s chosen nation, which was doing just fine before Bolsheviks started gumming up the works.
Perlstein makes a convincing case that lying is a core part of how the permanent campaign class of the GOP, from Richard Viguerie to NewsMax to Anne Coulter, milks its base. Where we may part company, though, is when he also argues that this is how the elite in the GOP rolls, pointing to what he calls a “curious fact”:
—for all the objections that conservatives have aired over Romney’s suspect purity in these last months, not one prominent conservative has made Romney’s dishonesty part of the brief against him.
Some of the right-wing spin machine are probably in it just for the money; but that’s probably the case with most long-running political movements. Some others are true believers, whether well-informed or prisoners of the self-referential epistemology that Perlstein points us to. Some of the billionaire funders may be operating on self-interest rightly understood. And some of the above are Straussians, actualizing the philosophy that the way to talk to — to lead — the masses is to lie to them. Romney doesn’t come off sounding like like a true believer, which is odd as his policies surely serve his self interest. That invites us to place him in another one of the categories. Perlstein says Romney is lying because that is what his backers expect. I suppose it could be, as Perlstein’s account would lead us to believe, that Romney’s lie parade is some dog-whistle style pitch to fellow Straussian would-be overlords, but if so it’s certainly not being done with much finesse, nor despite a generally stenographic mainstream press does it seem to have wowed the voters.
[Instant Update: fixed the title of Safire’s book!]
In a way, I blame my friend Greg Sargent. In the first week in January, he noted, almost in passing, that Mitt Romney seemed to be making a lot of false claims, and someone “really should document them all.” That struck me as a good idea, so I decided to tackle this on my own.
After all, I thought at the time, how hard could this be? Once a week, I’d let readers know about Romney’s whoppers, which I assumed would total about a half-dozen a week, and maybe after the election, I’d do a top 20 list of my favorites. The project would be a nice little Friday-afternoon feature.
Little did I know at the time that Romney would become an ambitious prevaricator, whose rhetoric would come to define post-truth politics. Nearly 11 months after Greg Sargent’s harmless suggestion, I’ve published 40 installments in this series, which, before today, featured 884 falsehoods. (If you include today’s edition, the new total is 917 falsehoods for the year.)
Given that Rivera left the state legislature about two years ago, and many of the facts were reported in newspapers a long time ago, you might wonder what exactly took Florida so long to file the charges.
Meanwhile, you now have eleven more reasons to vote for Joe Garcia to replace David Rivera in Congress.
The biggest local scandal of the week isn’t that a key witness in the latest David Rivera corruption case has vanished — shortly after being seen speaking with Congressman Rivera himself. That’s a doozy, but, no, the biggest scandal is a ballsy ripoff of insurance premiums paid in by Florida homeowners to state-sponsored home-insurer-of-last-resort Citizens Insurance Co. that is to be repurposed for the benefit of Republican crony capitalists.
A little background before the, ahem, money quote. Private insurance companies with actual capital, the ones that advertise on TV (Allstate, GEICO), won’t write homeowners insurance in much of Florida because they are too afraid they might have to pay out if a hurricane struck. To fill this void, the state of Florida created a back-up insurance company called Citizens. Citizens is far from perfect: it started out vastly undercaptialized, its customer service is lousy, and its rates are have always been high. But despite all these, it represents a deadly threat to the Republican world view because it is an example of government stepping in and solving a problem.
In the past few years the Citizens management, appointed by Republican Governors, has followed the following strategies:
Plead poverty, warn of catastrophic costs to Florida taxpayers if a hurricane strikes.
Raises rates 10% every year, and plead for the right to raise them even faster.
It so happens, however, that the weather has been kind. And thanks to its ferocious rate increases, Citizens faced the terrible prospect of solvency this year. Having said for many years that it would need at least $6 billion in reserves to deal with an Andrew-sized disaster, Citizens reached that goal. Only someone who did not understand the Florida GOP would think that Citizens would react by cutting prices, or at least halt price increases. No, rather than congratulate themselves on their fiscal prudence, the Citizens board decided it would raid the piggy bank — or rather, hand over parts of it in gifts to its well-connected friends.
Citizens would take capital from its record $6.2 billion reserves and lend it — under favorable terms — to private insurers who agree to take over policies and keep them for 10 years.
The 20-year loans require interest-only payments during the first three years and are forgivable, in part, if hurricanes hit the state. Citizens acknowledges that the interest rate of about 1.6 percent “does not approximate the true market rate” for similar loans and that Citizens could be left unpaid if an insurer goes belly up after receiving a loan.
Critics, including several state lawmakers, called it a “sweetheart deal” for insurance companies and “corporate welfare” funded by the premiums collected from Citizens’ customers over the past several years. With no hurricanes hitting the state since 2005, Citizens has saved up a massive treasure chest of $6.2 billion, money that private insurers find attractive.
“I sat here and listened to the board today give out one of the biggest bailouts. Corporate welfare, I call it,” fumed Sen. Mike Fasano (R-New Port Richey), blasting Citizens for quickly approving the controversial plan without legislative input.
The plan, which was unveiled to the public on Thursday, was approved by the board on Friday in a unanimous vote.
Got that? Loan the money at below-market rates to unercapitalized private insurers on the grounds that by taking over some Citizens policies they reduce Citizens’s risk. But if in fact the private companies have to pay out — the risk that Citizen is supposedly reducing — then they can keep the money! So Citizens’s risk isn’t reduced at all…or at least not very much (depending on the details). This is not only immoral, but a vast dereliction of the fiduciary duty to the state and to the insured. But that’s business in Tallahassee. I bet we’ll see some of these new insurance company moguls on TV explaining how they built their own businesses, and complaining about how hard taxes make it for them to be entrepreneurial.
The proposal mirrors one presented in July by a lobbyist for Tower Hill Insurance, which currently insures more than 300,000 policies in Florida. Tower Hill and another insurer that lobbied for the program have already indicated that they would take over more than 180,000 policies if Citizens provides a multimillion-dollar incentive.
Tower Hill and other insurers interested in receiving a low-interest loan funded by Citizens’ surplus have committed to raising rates no more than 10 percent per year during the loan’s interest-only first three years. After that, rates could go up further.
“The insurance companies have hit the lottery,” said Rep. Frank Artiles, R-Miami. “They get no competition, they circumvent the Legislature and they get exactly what they want. “This is a classic Tallahassee get-rich-scheme that has bitten us in the butt before.”
Artiles contended that the program’s eligibility rules were written in ways that exclude all but a few privileged insurers, which are represented by Florida lobbyists.
But of course. No wonder the public got one day’s notice of the plan before it was rushed through.
This does appear to have the makings of a record-shattering performance. I think Romney may be on form to grab the US title. I imagine there’s some Albanian or North Korean out there with the world title, though.