The dirty little secret about Obama’s preferred HCR plan (besides the part where he sold the public out on the public option, then went before Congress and lied about it still being on the table) is that much of the expansion in coverage doesn’t come from the vaunted (and largely useless, massively overpriced) Exchanges, but through an expansion in Medicaid.

That’s not really the dirty part of the secret, it’s just common sense; the Exchanges will see premiums soar so quickly, and cost so exhorbitantly much, that there was no hope, ever, of even getting them off the ground if the truly poor got to buy ‘private’, ie corporatist, insurance. They’ll fall apart due to prices eventually, but it would be better if it took a while, politically at least.

So they expanded Medicaid, and rolled up the popular SCHIP programs into it. All sounds good, right?

Wrong. First of all, many doctors won’t touch Medicaid with a ten foot pole, because it pays so little. Nor is there any legal requirement to accept it.

Secondly, however: Medicaid is a jointly funded operation, part federal, part state… and the states are broke.

So for the first few years, the expansion is paid for entirely by the Feds, to make sure it actually happens; then in 2017, the Feds cut the subsidy back dramatically, and the states are expected to pick up the tab. These subsidy rates are actually more generous than I would have expected; for poorer, IE, more typically Republican states, the Feds might still pick up the whole tab. Others, like California, will get stuck with a quarter of the bill for the newly eligible, plus the usual rate for the rest in the program.

What happens if they don’t, or even can’t, pick it up? And keep in mind, the boosted subsidies only apply to the ‘newly eligible’. So what if they cut the overall program to the bone?

Like, say, they’re considering now in Washington:

Some 500,000 Washington adults whose prescriptions are covered by Medicaid could soon lose that benefit unless lawmakers provide special funding when they reconvene in January.

Medicaid’s adult drug program, which provides medication to the state’s poorest individuals through a combination of state and federal funding, will be eliminated in March if the Legislature can’t come up with $40 million before Feb. 1, according to the Department of Social and Health Services (DSHS).

…

The adult-prescriptions program cannot be protected in the DSHS cuts because federal law requires states to maintain many other Medicaid benefits, Porter said. Those federally required benefits include pharmaceutical coverage for children and prescriptions dispensed in health-care facilities such as hospitals and nursing homes.

Got that? States can, and will, slash Medicaid to plug holes in their budget, and something as simple as a basic prescription drug benefit for adults is on the table.

So, much like in the exchanges, people will be given a lousy service, full of holes and light on doctors, that they can’t effectively utilize, and lo, it will be called ‘health care reform’ by Obama’s wide-eyed and incredibly gullible followers.

Lather, rinse, repeat.

Unfortunately, people tend to take a simplistic view of our emotional lives. Anger, rage, fear, sadness – you’ll see these things described as ‘negative’ emotions, or ‘dark’ ones by people who plead with you not to ‘give in’ to them.

Like, say, Phoenix Woman at FDL did Thursday, in a post called ‘Take a Deep Breath. Please‘.

A sample:

Just. Stop.

Look at your own actions, your own responses to actions. We may not be able to get others to behave, but we sure can keep from letting our responses feed the cycle.

Please. Step away from the rage. Take a walk. Stop feeding the hate by nursing your aggrieved feelings — you’re hurting yourself more than you’re hurting the original target of your rage. (I know, I’ve been there, I take blood pressure medication as a result.)

Please. For your sake. And all of ours.

The obvious mistake being made here, and by those who focus on rage as automatically negative, is that of assuming that rage is not only unjustified, but always unhelpful. The former is sometimes true, the latter is simply wrong. Not everyone who is angry, or full of rage, is wrong to be feel that way. Not every angry person is lacking in self-awareness.

It is correct to be angry, even filled with rage, when you look out at the world. Every day people commit unfathomable atrocities and casual cruelties, and every day, justice is denied and the indifferent universe goes on, neither caring nor noticing.

Rage is a proper response, and a great motivation, to change our lives for the better. In fact, the constant suppression of anger and rage, in the name of ‘cooperation’, of ‘compromise’, of ‘reaching across the aisle’ and ‘dialogue’ and being ‘reasonable’, is one of the crippling weaknesses of contemporary liberalism. We’re often admonished to take half a loaf, to settle, to accept the scraps from the table, because, well, that’s The Way It Is.

No. It might even be true from time to time, but acknowledgement and acceptance are not the same thing.

So go ahead. Get angry. Feel rage. Feed it, hone it, stoke it. Keep it under control by all means, but by all means, use your rage. A person who can honestly look at our deranged existence without rage has cut out an essential piece of their humanity, and I pity them. People who advise others to cut this out voluntarily are sadder still, and peddling weakness while calling it strength. Don’t confuse the incoherent, self-destructive behavior of idiots or fools with a fundamental human drive that can be harnessed for progress. Don’t confuse limiting your potential with useful self-control.

Whether people like the Balloon Juice crew like it or not, the dam seems to be completely breaking today on the mortgauge/foreclosure fraud mess, leading more or less inevitably to a complete lock-down.

First, we now have all 50 states on board with a gigantic joint investigation of the foreclosure fraud aspect of this crisis:

WASHINGTON – Officials in 50 states and the District of Columbia have launched a joint investigation into allegations that mortgage companies mishandled documents and broke laws in foreclosing on hundreds of thousands of homeowners.

The states’ attorneys general and bank regulators will examine whether mortgage company employees made false statements or prepared documents improperly.

Alabama initially did not sign on to the investigation. It reversed course after the joint statement was released.

Haha, I knew it would be some Deep South backwater that held out the longest; my personal gut instinct said Mississippi. I was close!

This quote from the Ohio AG who’s been spearheading this push provides excellent ammuntion against those who think we should prioritize keeping the mortgage market ‘functional’:

“What we have seen are not mere technicalities,” said Ohio Attorney General Richard Cordray. “This is about the private property rights of homeowners facing foreclosure and the integrity of our court system, which cannot enter judgments based on fraudulent evidence.”

Precisely. The rule of law has to take priority here, or else, well, everything falls apart.

Moving on, today JP Morgan abandoned MERS, the electronic system banks utilize to avoid actually recording mortgage transactions in accordance with local law.

That’s one down!

Finally, Felix Salmon has been doing some spelunking, and found that the entire mortgage bond market was more or less a sham, and that investors are going to be looking to dump much if not *all* of it back on the banks:

You thought the foreclosure mess was bad? You’re right about that. But it gets so much worse once you start adding in a whole bunch of parallel messes in the world of mortgage bonds. For instance, as Tracy Alloway says, mortgage-bond documentation generally says that if more than a minuscule proportion of notes in a mortgage pool weren’t properly transferred, then the trustee for the bondholders can force the investment bank who put the deal together to repurchase the mortgages. And it’s looking very much as though none of the notes were properly transferred.

But that’s not even the biggest potential problem facing the investment banks who put these deals together. It also turns out that there’s a pretty strong case that they lied to the investors in many if not most of these deals.

Essentially what Salmon found was that the banks that put together bonds made out of mortgages they bought in large groups knew that many of the mortgages were absolutely worthless, because they checked; they hired an outside firm to evaluate them. In one sample from Citi, in fact, over 40% turned out rotten.

The bank’s response to this was priceless; they’d ditch the ones from the random sample that they knew were bad (the samples ranged from 5% to 35% in size, apparently), then, knowing full well that many of the mortgages in the unsampled portion had to be bad as well (that’s how random samples work, you extrapolate from the sample to the larger population), they didn’t put the stop to the deal – they just got a lower price on the pool of bad mortgages, and resold them as bonds to investors.

Without telling them that they had gotten inside information that many of the mortgages were utter crap.

Sure, they’d weeded out *some*, but not all, or even most. And sometimes they used some pretty enormous sample sizes, relative to the population I mean. 35%? Wow.

Ok, so they knew with a pretty damn high level of confidence that many of the remaining, untested mortgages were crap. They bought the good ones, along with the unsampled ones they knew had a lot of duds, at a discount, sold them at a premium, and didn’t disclose to the investors the truth about the overall quality.

I’d sue over that; how about you?

So here’s the current scenario:

-Many, perhaps most, potentially nearly all foreclosures being done by the major banks violate the law, thanks to shoddy recordkeeping.
-All 50 states, plus the District of Columbia, consider this problem to be rampant and endemic, and are investigating. Potentially all foreclosures done in quite a while will have to be re-evaluated, even redone.
-In response, JP Morgan has abandoned MERS, the electronic system used to avoid processing the paperwork properly.
-Of the mortgages not in foreclosure, potentially all of the ones sold during the boom were sold fraudulently, and their current ‘owners’ will be looking to divest themselves of them via lawsuit

Yeah. Moratorium here we come, like it or not.