Is that the sound of a drumbeat coming out of Andrew Ross Sorkin’s DealBook?
Sorkin wrote a great piece yesterday questioning why authorities haven’t brought cases against any major corporate figures for causing the crisis. Now new DealBook columnist, ProPublica’s excellent Jesse Eisinger, asks where the prosecutions are:
Nobody from Lehman, Merrill Lynch or Citigroup has been charged criminally with anything. No top executives at Bear Stearns have been indicted. All former American International Group executives are running free. No big mortgage company executive has had to face the law.
How about someone other than Fabrice Tourre, known as the Fabulous Fab, at Goldman Sachs? How could the Securities and Exchange Commission merely settle with Countrywide’s Angelo Mozilo, and for a fraction of what he made as chief executive?
The world was almost brought low by the American banking system, and we are supposed to think that no one did anything wrong?
Eisinger is right to say that the hedge-fund insider trading scandal, bad as it is, is a sideshow compared to the real deal fraud that took down the system. And he’s good in taking down the “natural disaster” defense:
The most popular reason offered for the dearth of financial crisis prosecutions is the 100-year flood excuse: The banking system was hit by a systemic and unforeseeable disaster, which means that, as unpleasant as it may be to laymen, it’s unlikely that anyone committed a crime…
It’s shocking how pervasive and triumphant this narrative of the financial crisis has been.
Keep it up.
— Michael Hiltzik of the Los Angeles Times goes all New Deal on President Obama, who has flubbed his chance to be an FDR-style president. Unlike Obama, FDR had a spine and liked to scrap, as Hiltzik writes. Obama, uh, doesn’t.
FDR’s best-known retort to his critics on Wall Street, uttered in a 1936 campaign speech, was “I welcome their hatred.” But in that speech he also drew a razor-sharp distinction between his administration and the previous dozen years of GOP rule, which ended with three years of depression.
“Nine mocking years with the golden calf and three long years of the scourge!” Roosevelt said. “Nine crazy years at the ticker and three long years in the bread lines! Nine mad years of mirage and three long years of despair! Powerful influences strive today to restore that kind of government with its doctrine that that government is best which is most indifferent.”
Have you heard anything that colorful or direct from President Obama? Me neither. Did Roosevelt make a rowdy fight of it? You betcha.
Calling them “fat cats” once was enough to give Wall Street the vapors. Imagine how miffed they’d be if Obama had actually, you know, fought them (my fellow Okie Elizabeth Warren put it best when she said she’d rather fail trying to get something good and leave “plenty of blood and teeth left on the floor”) instead of bringing Robert Rubin proteges into the White House.
— The Wall Street Journal spotlights how doctors are recommending an expensive treatment for prostate cancer in ways that track their financial interests.
It’s good, of course, to watchdog that issue, but this nice catch particularly caught my eye (emphasis mine):
Integrated Medical is headed by a urologist named Deepak Kapoor. “Is radiation a line of business for us? Yes,” Dr. Kapoor said in a July interview at the group’s main radiation facility. But, he added, IMRT wasn’t the practice’s most profitable activity, and use of the treatment was driven by patients, not by the practice’s doctors.
Asked during the interview what proportion of its prostate-cancer patients Integrated Medical treats with IMRT, Dr. Kapoor said he didn’t track such data closely, but said he would be “comfortable” with an estimate of “one out of six,” or 17%.
An analysis of Integrated Medical’s Medicare claims later performed for the Journal suggested a much higher rate. Between its launch in mid-2006 and the end of 2008, Integrated Medical administered IMRT to 601, or 53%, of 1,132 Medicare patients recently diagnosed with prostate cancer, the Journal analysis found.
And Mr. Kapoor digs himself in deeper:
Integrated Medical received $26.7 million from Medicare for the care of those 601 patients, according to the Journal’s calculations. If Integrated Medical’s urologists hadn’t owned radiation equipment and had referred these patients for radiation treatment outside of their practice, Medicare would have paid them only $2.6 million.
After being presented with the Journal’s data, Dr. Kapoor denied earlier giving a one-in-six estimate, and said he believed Integrated Medical’s utilization rate for IMRT was in “line with what’s practiced in the community.”
Nice work. And I’m not sure I remember seeing the Journal team up with an outside journalism organization for a story, so this is interesting:
The Wall Street Journal, together with the nonprofit Center for Public Integrity, obtained a 5% sample of all Medicare billing, but was unable to form an accurate picture of self-referring urology groups’ treatment patterns from the sample. The Journal subsequently obtained 100% of these groups’ billings from the Department of Health and Human Services for an additional fee. The Journal agreed not to publish billings of individual doctors. Instead, it is restricted to analyzing groups of 10 or more physicians.