Death as Profit (extended)

(11 am. – promoted by ek hornbeck)

You read the title correctly; Dying is now seen as PROFIT venture!

The bankers plan to buy “life settlements,” life insurance policies that ill and elderly people sell for cash – $400,000 for a $1 million policy, say, depending on the life expectancy of the insured person. Then they plan to “securitize” these policies, in Wall Street jargon, by packaging hundreds or thousands together into bonds. They will then resell those bonds to investors, like big pension funds, who will receive the payouts when people with the insurance die.

The first question should be, who in their right mind would sell their life insurance policy to Wall Street?  Why would people give up the very last of their children’s security upon their death?  Obviously, some are willing to do just that, and, Wall Street, not having missed an opportunity to turn a profit, is ready to capitalize on it. Fortunately, there are smarter people out there who keep their life insurance policies similar to Paradigm Settlements (https://www.paradigmsettlements.com/) for their families and not gamble it away on the stock market.

As American families worry about the price of health care, which many cannot afford now, this news is even worse:

The earlier the policyholder dies, the bigger the return – though if people live longer than expected, investors could get poor returns or even lose money.

Either way, Wall Street would profit by pocketing sizable fees for creating the bonds, reselling them and subsequently trading them. But some who have studied life settlements warn that insurers might have to raise premiums in the short term if they end up having to pay out more death claims than they had anticipated.

Get that?  As the Obama administration has already given the insurance industry its word that it would safeguard its profit margins, here comes a new plan that would likely make insurance companies raise its premiums!  Well, it’s not firm yet:

The idea is still in the planning stages. But already “our phones have been ringing off the hook with inquiries,” says Kathleen Tillwitz, a senior vice president at DBRS, which gives risk ratings to investments and is reviewing nine proposals for life-insurance securitizations from private investors and financial firms, including Credit Suisse.

Should we hold our breath that President Obama, much less Democratic politicians, will have a forceful message about this?

I’m not going to go into some long diatribe about this new plan to turn death into a profitable business.  It speaks for itself just how morally corrupt our society has become that people would even consider trying to turn death into a profit-making business.  But, keep this in mind as President Obama tells us just how much he really really wants a public option for American families, but, you know, Congress is the one that is to blame if it doesn’t actually happen — all while he pressures the PROGRESSIVE caucus for standing up for a public option and not the Blue Dogs for obstructing one.

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You know, after sitting here a few hours thinking about this, I am going to comment further.

What we have here are two “industries”, Wall Street and Insurance, trying to find new ways to turn a profit.  Wall Street wants to see if they can profit off a person dying.  The insurance companies, as usual, feel they can simply pass on any losses to the customer effectively making even more people uninsured.

But, this, and by “this” I mean two industries looking for more profit, isn’t what has pissed me off these past few hours.  No, that happened when I thought of everything President Obama and the Democrats have done since January.

George Bush and Paulson simply wanted to give money to Wall Street as a going away present, ie, no conditions or strings attached.  They knew then the crisis that was coming, but instead of get out in front of it, they simply gave away hundreds of billions of our tax dollars.  So, banks hoarded the money, paid huge bonuses, bought up other banks, basically, they did everything but try to help anyone other than themselves.

So, here comes newly elected President Obama as the true damage hits the news.  His first job is to appoint people that would not only solve the current crisis, but, work to prevent further financial meltdowns.  Did he?  No.  President Obama, after some finger waving and scolding, put in place Larry Summers and Geithner.  Wall Street got their insurance from President Obama that they, as an industry, were secure, so, they are now trying to find the next bubble of derivative trading to crash our economy.  

The insurance companies, knowing that they could be left holding the bag, are already looking to hand that bag off to the policy holders.  Inside that bag are higher premiums.  But, as I noted above, President Obama has already had his own secret meetings so that insurance and health care industries are assured they too can keep their profit margins.

The NYT story was posted on September 5th.  This is September 7th.  Two industries that have been saved and protected by the Obama administration are now looking to profit off of people dying.

There won’t be any meaningful regulation of Wall Street regardless of the lip service we are hearing.  We will not get a public option nor any meaningful regulation of the insurance companies and banks.  It will be, frankly, business as usual after much handwringing, jibes, scoldings, and posturing.

So, what still has me pissed off?  Because as a bomb technician and police officer, you always knew you would die one day; and we were supposed to die sooner than later.  But, as a veteran, I could have requested my burial be at Arlington Cemetary.  Too bad I can’t now because it is full.  So, we’ve been looking for another place for me be buried, or maybe cremated, or whatever.  Let’s just say that it pissed me off that I can’t reside at Arlington because George Bush went and got several thousand of our armed forces service members killed in an illegal war of aggression.

But, now we to hear that after you are dead, these companies can still get a piece of your flesh because they traded your life insurance around like poker chip.  So, how would this work?

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Let’s take Fred.  Fred built up a small business into a pretty good venture.  He’s getting older, his wife passed away, and his only child was killed early in life.  He has a modest amount in savings, but, a huge amount in his life insurance policy.

So, let’s say that Fred decides that for him to retire, he could sell his insurance policy.  Is Fred now bound to pay for his own funeral, or, does the bank he sold it to still hold responsibility?  Nobody seems to know.  

But, if Wall St. is shifting its problems to the insurance companies, you can bet they will shift the problem to the former policy holder, who will be deceased.  In Fred’s case, there is no one.  In most cases, there are spouses and children involved.

And we can’t see what a clusterfuck they are trying to put together to screw up everything.