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The Biz Roundup March 1

It’s Sebelius in the second round draft.

President Barack Obama has chosen Kansas Gov. Kathleen Sebelius to head the Department of Health and Human Services and will announce the decision at the White House Monday, administration officials said Saturday. . . .

Before becoming governor, Ms. Sebelius was a two-term state insurance commissioner, overseeing the regulation of health insurance in Kansas, where she won a reputation as a consumer advocate. She was also president of the National Association of Insurance Commissioners.

(“Problems face Sebelius if she is next health chief,” Yahoo! News, March 1) Here’s what I’m missing from First Round Draft (Daschle) and Second Round Draft (Sebelius): while both draft picks are immensely effective legislators (Daschle) and managers (Sebelius), health care reform, which we are to assume will be the biggest pile of papers on the HHS’s desk, requires out-of-the box thinking. Both Daschle and Sebelius are primarily deal-makers, though Daschle is arguably better at it than Sebelius, and it’s clear from every appointment Obama has made — from Rahm Emmanuel downwards — is that he intends his administration to be a deal-making administration. What we’re missing, though, is the big vision, the forward-thinking about health care that can make the whole creaky thing work right out of the blocks.

AIG, which stands for “All I can Get,” hoovers up another $30 billion dollars.

American International Group Inc., the insurer deemed too important to fail, may get a commitment for as much as $30 billion in new government capital after a record quarterly loss, said two people familiar with the matter.

The insurer may also be allowed to make lower payments on government loans, said the people, who declined to be identified because there was no public announcement. . . .

Firms including banks relied on AIG to back more than $300 billion of assets through derivative contracts as of Sept. 30, making the insurer a “systematically significant failing institution” that has to be propped up, according to the Treasury. . . .

The biggest insurers in North America posted more than $150 billion in writedowns and unrealized losses linked to the collapse of the mortgage market from the start of 2007, with AIG representing more than a third of that total. The company has units that insure, originate and invest in home loans.

(“AIG May Get $30 Billion in Additional U.S. Capital,” Bloomberg, March 1) Taxpayers pretty much own AIG (80%), so this is what the AIG bailout is all about. We’re not saving AIG, we’re saving everyone else. Except we’re accomplishing it by pumping money through AIG. By keeping AIG’s derivative obligations above water, the American taxpayer is essentially subsidizing all the counter-parties (including many foreign financial institutions), who are equally guilty of miscalculating the risk of much of the debt they hold. So it’s kind of like a buffet for everyone but only AIG looks like the schmuck who can’t stop eating.

It happened in the 1930’s, too.

While much of the economy is teetering between bust and bailout, the movie industry has been startled by a box-office surge that has little precedent in the modern era. Suddenly it seems as if everyone is going to the movies, with ticket sales this year up 17.5 percent, to $1.7 billion, according to Media by Numbers, a box-office tracking company.

And it is not just because ticket prices are higher. Attendance has also jumped, by nearly 16 percent. If that pace continues through the year, it would amount to the biggest box-office surge in at least two decades.

(“In Downturn, Americans Flock to the Movies,” New York Times, February 28) As I drove the the Cinemark complex this morning, the place was packed with families going to see Jonas Brothers (I think, everything else was very adult-oriented). If you are an independent filmmaker (I have spent the last three years working heavily with independent filmmakers), you’ll be guessing about now that the money is in family entertainment. So you might want to revise that slasher-the-cabin script so that it appeals to the little kids, too.

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One Response to “The Biz Roundup March 1”

  1. FG says:

    Nice post


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