Harvard professor and author Louis Menand wrote a very insightful article in the March 1, 2010, issue of The New Yorker entitled “Head Case: Can Psychiatry be a Science?” In it, he describes the complexity of defining, diagnosing, and treating psychiatric disorders.  He quotes many experts in the field of mental and behavioral health disorders who, as he put it, in referring to the work done Professors Jerome Wakefield and Allan Horwitz

“…the increase in the number of people who are given a diagnosis of depression suggests that what has changed is not the number of people who are clinically depressed but the definition of depression, which has been defined in a way that includes normal sadness.”

He later points out that the traditional disease model with which we diagnose physiological disorders is of no help.  In cases in which we present a fever to a doctor, the doctor can conduct a test to determine whether the condition is a bacterial infection treatable with antibiotics, or a virus, which is not treatable.  With psychiatric disorders, particularly a mild case of depression, there are many false positives, because no one has found a test that, with any degree of confidence, demonstrates that someone has a biologically treated case of clinical depression.

Why is this important?  It is an example of why the traditional insurance model does not work for health care, and why giving everyone access to affordable “insurance” is doomed to failure. Insurance covers known or definable risks that do not increase through being radically being redefined over time.  If they do, premiums go way up.  For example, life insurance policies are typically not issued to people living in a war zone in which the risk of death has exponentially increased and shows no signs of being predictable or controllable.  Insurance companies can feel comfortable insuring against death, injuries, or property damage to cars and homes because these risks do not jump out of control in a short period of time.

Health insurance has become more like life insurance in war zones, with one big difference.  In the war zone example, an external set of circumstances, the beginning of a war, has increased the risk.  In the case of health insurance, not only can external circumstances raise the risk and cost, but both the consumer and the providers of treatments can redefine the risks and increase the costs.

Think about a life insurance policy.  The risk against which to be insured is “death.”  Imagine if a life insurance policy were suddenly converted into a policy that insured against “death,” being diagnosed with a terminal disease, and losing one’s home.  None of us would expect the insurance company to pay for these other events, because the policy has a well-defined risk it covers.

However, the definition of “health” keeps changing, sometimes through patient behavior, sometimes through physician behavior, sometimes through the marketing done by pharmaceutical companies, and sometimes by operation of laws and regulations.  In the last 20 years, we have seen the expansion of “mental health” coverage to include mild depression that was not deemed worthy of insurance coverage.  While we expanded mental health coverage at Pitney Bowes because we believe treatment for mental conditions like clinical depression is foundational for getting people able to adhere to treatment plans for diabetes, heart disease, and hypertension, we also were able to put in controls that prevented runaway health care cost increases.

Similarly, drug companies have defined erectile dysfunction as a medical condition requiring treatment by a physician and a drug treatment like Viagra.  I have no problem with this process of creating new medical conditions that lend themselves to drug treatments, but we should not be surprised that health care costs keep going up.  Similarly, 20 years ago we felt sad for people who could not have children and glad for them if they were able to access fertility treatments to be able to fulfill their dreams of being parents.  However, to require that multiple-egg fertility treatments be included in every insurance policy issued in a state, as is the case in Connecticut, drives up health care costs for everyone.

There are many other examples of marginally effective or even ineffective treatments that patients and physicians, and eventually lawmakers, believe they have to make a requirement in every health care insurance policy, so the cost keeps going up.  The notion that, by having government control everything, we will see cost reductions over time, is not credible: government mandates which drive up costs have been part of the problem in the first place.  If anything, government control of health care will accelerate the process of adding more “requirements” to health care.

There are three cost drivers in health insurance:

• What gets covered and paid for;
• What is paid for each transaction in which there is a diagnosis consistent with a covered item; and
• The frequency with which transactions occur.

Government can be very effective in mandating what gets paid per transaction, and, indeed, through Medicare and Medicaid, for very low administrative costs and with high reliability, government, through its contracted third-party administrator relationships, does a very good job paying doctors, hospitals, drug companies, labs, and other care centers for services rendered.  In fact, although it is not clear whether a majority of physicians feel this way, a significant number of physicians would prefer the simplicity and predictability of payment of a single-payer system operated on behalf of the government over the confusing, complex, and resource-consuming challenges of submitting and defending private insurance claims.

What government does poorly is keeping control of what gets covered and paid for, and, because of its low administrative overhead and its payment on a transaction-by-transaction basis in what we call a “fee-for-service” system, controlling the frequency of transactions.  If I have a chronic disease like coronary artery disease, no payer can monitor whether it is appropriate for a cardiologist to see me 3 versus 5 times a year.  That decision has to be left to the physician, and I am certain that an attempt by government to regulate it would be met with extreme anger and resistance by patients.  Yet, a 20% reduction in payments to the cardiologists could be easily offset by increasing the frequency with which cardiologists see patients.

What would also happen is that physicians would spend less time with each patient, which would reduce the effectiveness of each visit, and the treatment paths would more often be more tests and more drugs, which will add cost to the system.  I remember having a problem with staph infections on my face in the late 1980’s and early 1990’s.  The private practice physicians whom I consulted had 5-10 minute visits, which only gave them the ability to diagnose the problem and prescribe a medication.  Dr. Jack Mahoney, the Pitney Bowes Medical Director, whom I first consulted in 1996 and who had the luxury of a 20-minute visit, determined that I needed to change how I shaved, and was able to give me advice that not only eliminated the problem at the time, but prevented it from ever coming back.  He was not rewarded for having encounters with me, but for making me healthy.

l comfortable insuring against death, injuries, or property damage to cars and homes because these risks do not jump out of control in a short period of time.

Health insurance has become more like life insurance in war zones, with one big difference.  In the war zone example, an external set of circumstances, the beginning of a war, has increased the risk.  In the case of health insurance, not only can external circumstances raise the risk and cost, but both the consumer and the providers of treatments can redefine the risks and increase the costs.

Think about a life insurance policy.  The risk against which to be insured is “death.”  Imagine if a life insurance policy were suddenly converted into a policy that insured against “death,” being diagnosed with a terminal disease, and losing one’s home.  None of us would expect the insurance company to pay for these other events, because the policy has a well-defined risk it covers.

However, the definition of “health” keeps changing, sometimes through patient behavior, sometimes through physician behavior, sometimes through the marketing done by pharmaceutical companies, and sometimes by operation of laws and regulations.  In the last 20 years, we have seen the expansion of “mental health” coverage to include mild depression that was not deemed worthy of insurance coverage.  While we expanded mental health coverage at Pitney Bowes because we believe treatment for mental conditions like clinical depression is foundational for getting people able to adhere to treatment plans for diabetes, heart disease, and hypertension, we also were able to put in controls that prevented runaway health care cost increases.

Similarly, drug companies have defined erectile dysfunction as a medical condition requiring treatment by a physician and a drug treatment like Viagra.  I have no problem with this process of creating new medical conditions that lend themselves to drug treatments, but we should not be surprised that health care costs keep going up.  Similarly, 20 years ago we felt sad for people who could not have children and glad for them if they were able to access fertility treatments to be able to fulfill their dreams of being parents.  However, to require that multiple-egg fertility treatments be included in every insurance policy issued in a state, as is the case in Connecticut, drives up health care costs for everyone.

There are many other examples of marginally effective or even ineffective treatments that patients and physicians, and eventually lawmakers, believe they have to make a requirement in every health care insurance policy, so the cost keeps going up.  The notion that, by having government control everything, we will see cost reductions over time, is not credible: government mandates which drive up costs have been part of the problem in the first place.  If anything, government control of health care will accelerate the process of adding more “requirements” to health care.

This is why the Obama Administration focus on health insurance access is deeply flawed.

He stated that there were three fundamental differences:

• Democrats favor comprehensive reform and transformation; Republicans favor a more incremental approach.
• Democrats believe that access is the priority, rather than cost reduction; Republicans believe that if health care costs are reduced, the access problem will get solved.
• Democrats believe strongly that the government needs to set standards for health insurance and health care; Republicans believe that the market, particularly consumers, need to decide what they want for health insurance and health care.

Where do I stand?

• I am somewhere between the two parties on the comprehensiveness issue, although I tend to believe that comprehensive reform opportunities come along infrequently and we should take advantage of this one.  On this issue, I would agree with the Democratic philosophy.
• On the other hand, I do not believe we can tackle the insurance access issue without understanding why access has been a problem in the past. Runaway health care costs cannot be deferred until later.  Business and global competitiveness depend on addressing cost before access.
• Relative to health care needs, I believe the government should create a safety net for those unable to get coverage from private insurance, although I do not believe that safety net should include either guaranteed issue or elimination of pre-existing condition requirements for private insurance policies.  The burden for the least healthy members of our society, and them alone, should be borne by all citizens, not in a way that burdens every private insurance policy.  Government is totally ill equipped to decide on minimum coverage for everyone else.  Over the years, elected officials have repeatedly added coverage mandates to all insurance policies because of the power of special interest groups, whether or not the mandates represented good medicine.  Think back to the excessive expansion of bone marrow transplants combined with high-dose chemotherapy in the early 1990’s because cancer advocacy groups mistakenly believed it could save lives.  In fact, after a Congressional mandate was also adopted in many states, the treatment was found to be worse, on average, than doing nothing.  It shortened lives.

Some very smart people have said to me: “Why don’t we solve the insurance problem now, since we can, and we’ll get to cost reduction later?”

Aside from the competitiveness issues to which I referred above, there are two other problems with expanding coverage and not dealing with upstream prevention and health care system issues:

• Giving someone access to health insurance is not only not the same as giving them access to health care, it often results in lower quality care for everyone because of increased demand, and, eventually, decisions by doctors to stop treating Medicaid patients because they get reimbursed less than they do through commercial insurance.  Having an insurance card, but no doctor to use it with, is useless. Massachusetts has had universal health insurance since 2006, but both the access to care and the quality of that care have suffered.  More non-elderly adults report difficulty in getting access to physicians in 2009 than they did in 2007.
• To the degree that there is universal insurance, but inadequate access to doctor care, there is even more strain on our emergency departments. Many studies have pointed out that a majority of the people who access the emergency department for non-urgent care, that is, inappropriately, have insurance coverage, but either do not have timely access to care or are too impatient to wait until they can get access.  The system gets stressed at its weakest point, emergency care.

I am most disappointed that the Democratic majority in Congress and the very capable White House staff could not establish a prevention and wellness agenda, and begin to take on the badly broken fee-for-service health care payment system.

People who argue the practical politics of tackling the insurance issue always point out to me that politicians are swayed by hard-luck stories, individuals who died or went bankrupt because they could not afford sufficient health insurance to cover catastrophic health problems like cancer, heart disease, or a serious injury.  Unfortunately, no health insurance system can eliminate these tragic stories.  Moreover, increasing demands on the health care system without increasing the supply of physicians and nurses creates other kinds of tragedies.

Politicians are very moved when an individual tells a story about being unable to afford a “life-saving” cancer treatment because of no or inadequate health insurance. What puzzles me about these stories is whether the patient has attempted to get relief directly from the pharmaceutical manufacturer.  Every pharmaceutical company has programs to provide life-saving drugs for individuals who cannot afford them, and they provide relief for many patients every year.

However, the tragedy of someone who had no primary care physician because doctors in his or her community did not accept Medicaid patients, and, who, as a result, has an undiagnosed heart or diabetic condition, is a harder one to portray on the evening news.  The patient generally does not understand that, but for a stingy government program, he or she might have had access to a doctor who could have diagnosed and treated the condition earlier.  A public health official from India described the explosive growth of undiagnosed chronic disease cases as a “health tragedy in slow motion”

Implementing universal and affordable health insurance without addressing the imbalance between supply and demand in the underlying system will simply swap one kind of tragedy for another, at a much higher cost to the taxpayer and to businesses that can create jobs to bring many more people out of poverty.  The Democratic majority seems hell-bent to do something, even if it is the wrong something, relative to health insurance.  That’s too bad, and we will all pay dearly for the mistake.

In it, George Clooney plays an executive named Ryan Bingham, who works for a company that enters into contracts with large employers that have neither the will nor the skill to handle mass terminations themselves, so they outsource them to Bingham’s firm.  The subject matter is painful because the devastation of losing a job has hit so many households. I had this type of experience back in1978 when my law firm told me I would not be offered a partnership.

However, the more interesting aspect of the movie is the way Bingham leads his life.  He travels over 320 days of travel a year, and has built a life in which he gets treated exceptionally well by airlines, hotels, and other service firms, and he has temporary relationships on the road that require no deep emotional commitments.  He has successfully avoided having to deal with the messiness of a family life or maintaining a substantial home base.  In fact, his one-bedroom apartment in Omaha, Nebraska, appears unoccupied, because it is so sparsely furnished.

Not surprisingly, one subtext of the movie is how messy reality intrudes itself into his antiseptic, perfect life.  The first intrusion comes from a young female manager who attempts to dismantle the whole process of having executives travel to terminate employees, by substituting termination conversations by video teleconference. Although she first appears to be a person who needs no emotional support, she ends up requiring significant support from Bingham as her relationship with her boyfriend sours.  The second intrusion comes from Bingham’s two sisters, one who is getting married and the other who is separating from her husband.  The third intrusion comes from what initially looks like a casual relationship with a woman named Alex, for whom Bingham develops a deeper emotional attraction, but whom he discovers is uninterested in a deeper relationship.

My life bears no resemblance to what Bingham is experiencing.  However, I ponder why Bingham would find the life he leads attractive, and I can understand it at some level:

• We all want others to function in a way that makes our life as easy as possible.  Because of the growth of corporate loyalty and rewards programs over the last 30 decades, we get predictably exceptional care from people in organizations to which we have given a lot of business. People treat us with great care because it is in their financial interest to do so, and because, within their sphere of activity, they have been well trained to do so. In the home or community environment, as well as the workplace, higher loyalty is not predictably rewarded.  Some of the people who have to treat others with great deference in service occupations get burned out, and manifest their burnout by lashing out at family and friends outside of work. One of the ironies of Up in the Air is that Bingham expects loyalty because of a long history of rewarding corporations with his business, but he destroys the predictable link between loyalty and reward in the corporations for which we works for the employees he terminates.
• Aside from wanting to be rewarded for our loyalty and patronage, we want a manageable and predictable level of demands from those around us. Stress comes to our life from highly demanding or unpredictable environments, especially when our capacity to meet those demands does not match what is demanded. Bingham creates stress in the lives of those he terminates, and then gets stressed by being forced to intervene with his sister’s fiancé just before their wedding ceremony.  He is thrown into a situation in which he is expected to act almost as a marriage counselor.

If I were to describe my past year relative to these points, I would make the following observations:

• Like Bingham, I like the idea of having a specific level of loyalty being rewarded with a predictable level of service.  Unlike the Bingham character, I actually get uncomfortable with too much luxury service. Exclusivity and isolation make me extremely uncomfortable.
• While I was fully prepared to accept much higher demands on my time and resources than Bingham, I, too, discovered my limits.

I found that leaving the Chairman and CEO positions reduced some demands on me, but spawned many others, and that I was unevenly equipped to deal with them.  I expected that some people would approach me to serve on boards, to make charitable contributions, to invest in their businesses, or to give them career advice.  To a degree, these demands were manageable.

However, I learned that my post Pitney Bowes life was not one in which I could substantially control the demands made on me:

• Demands for political support and contributions were far more complicated to manage when I left Pitney Bowes.  At the Company, I evaluated every request for support by the degree to which it furthered the Company’s goals.  As a private citizen, I have to make choices among good, but obviously imperfect candidates, without the simpler criteria I could apply as a CEO.  Deciding among friends and multiple candidates I respect is not fun or easy.
• With respect to charitable contribution requests or investments, I lack the very capable community investments and corporate development teams that did a great job evaluating charitable or investment proposals.  Moreover, there are many more desperate people today with more fragile organizations, so every contribution or investment decision is higher risk than it would have been two years ago.
• Similarly, many more good, desperate, unemployed friends come to me for advice and help. My ability to help, and their willingness to take my advice, is harder to assess in this more complex and challenging employment environment.  For example, the whole world of posting recommendations on Linked.in for someone is totally foreign to my experience.
• Political advocacy is more complicated, because, for whatever reasons, the task of seeing my work bear fruit, particularly on

health care issues, is far more complicated. I thought it was because I lacked a power base in terms of money, size of organization that I led, or political connections, especially when I watched CEOs, union leaders, lobbyists, and trade association presidents get face time with government officials.  However, many of these high-powered people have expressed extreme disappointment that their efforts were wasted, unless they intended to make sure nothing happened.

• Finally, like many people who have been in positions of significant responsibility in a large business, I am distressed by the indiscriminate anger and resentment directed at successful business people.  There are certainly many legitimate targets of public anger in the business world, but our elected officials have fostered an environment of indiscriminate anger directed at even very decent CEOs or other people who have been successful.  That’s wrong!

I am very energized by the many exciting things on which I am working, including my evolving effort to become a broad and deep expert in health, particularly the social determinants of health, and my efforts to break into the entertainment industry.

Nevertheless, there are times when the Ryan Bingham world seems very attractive because of its simplicity, its clear linkages between behaviors and rewards, and its lack of pressure. I would never want that world, but I can understand better the psyche of those who seek it out.

Baskin & Robbins has gotten the public to patronize its stores because it has offered 31 different flavors of ice cream.  The 31 flavors attempts to capture the full range of the public’s potentially diverse tastes for ice cream.  In addition, many flavors come and go over time.  So the 31 flavors reflect both diverse and changing preferences.  Baskin & Robbins has stayed in business because it consistently has reinvented and recombined flavors to appeal to new generations of ice cream lovers.

Because we are so near Valentine’s Day, there have been many articles about successful marriages. Couples attribute the longevity of their marriages to compatibility of values and interests, the ability to resolve differences, the ability to create space for each of them to grow and develop, and a variety of other explanations.

For my wife Joyce and me, the explanation lies in the “31 flavor” metaphor, both in the diversity of the interests we have pursued, the number and range of friendships we have had, and the frequency with which we have reinvented ourselves.

In 1979, right after getting married, we took our first big step, moving to the East Coast, and each getting new jobs.  In 1981, we took another radical step, selling our Darien home, moving to New York City, and, within two years, having Joyce leave her law career behind and become a real estate professional.

In 1986, we become parents for the first time, and, after our second child was born, moved back to Connecticut in 1990.  Joyce encouraged me to expand beyond law to human resources, and then, in 1993, to leave both staff jobs behind and become an operating division President.  That decision paved the way for me to become Chairman and CEO in January, 1997.

Probably the most pleasant surprise in both our lives has been the way Joyce caused our children’s passions to take us into worlds we never would have explored on our own. Our older son was attracted to the performing arts as early as age 10, and, today, is an aspiring screenplay writer in Los Angeles, after having graduated from the University of Southern California.  I could not have imagined the degree to which we have learned so much about the film, TV, and theater and stand-up comedy industries because of him.  I have seen linkages between entertainment and political and social advocacy that would have never been obvious to me.  We have a large and growing group of friends in California because of him.

Our younger son took us into the worlds of town and school sports and Boy Scouts, but also drew us into the wonderful subculture of both scholastic and professional chess.  We met some of the best and most famous chess players in the world, and took him all over the United States and to six different countries to play chess. More recently, as he became an online seller of books, consumer electronic items, and other odds and ends, we learned a great deal about the world of online commerce, including the use of online auctions for charitable fund-raising.

Our daughter took us into the worlds of Mandarin Chinese, music, and, more recently, science research.  She also studied Spanish and Arabic along the way. While I studied piano for 10 years as a child, seeing our daughter do one of her first public performances as a harpist at age 12 at the Stamford Visiting Nurses and Hospice Care Tree of Life ceremony over four years ago was more pleasing than anything I personally accomplished as a musician.  The two of us had our own wonderful shared experience over many years skiing every February in Vail and building relationships with family and both new and old friends in Colorado.  Today, she has gotten me very interested in neurological research because of our shared interest in finding a cure for Alzheimer’s Disease.

I cannot even begin to fathom how many worlds into which Joyce has taken me.  Her passions for education reform, for scouting, for children’s environmental health, for providing social services for troubled families, and, more recently, for the Westport Country Playhouse and for women’s health issues have also taken me into worlds I would not have touched on my own.  She also connected with both the University of Southern California and, more recently, Cornell University (where our second son is a student) in ways that I never would done.

Our lives have had stresses and even tragedies, including the loss of a son at birth in 1989, but we have had the most blessed marriage because we have each recognized that marriage is not a static institution, but one in which each partner has to evolve and in which the relationship needs to be reinvented in some way almost every day.  Neither of us has ever taken for granted what we have had, and, therefore, we have been pleasantly surprised by what each phase of our lives has brought us.

This has been a wonderful set of life experiences for us, and the celebration of an anniversary has been a great time to step back and savor our marriage.

One of my favorite TV shows of all time, Rod Serling’s The Twilight Zone, frequently dramatized the message that people who saw the world differently from others often experienced difficulty and, in some cases, tragedy.  Two of my favorite episodes that made this point powerfully were “Terror at 20,000 Feet” starring a young William Shatner as an airplane passenger who sees gremlins trying to take apart an airplane wing while the plane is in flight, and “The Howling Man” in which an American is recounting a story to his housekeeper about why he is imprisoning a man whom he says is the devil.  In both cases, the passenger and the American seem psychotic and their perspective is disregarded.  In both cases, at the end of the show, they are proven right.

Thankfully, no one has ever accused me of being psychotic.  Unlike the William Shatner character, I did not get carted away in a straightjacket, and, unlike the American in “The Howling Man” the consequences of others not believing me did not result in the devil being unloosed upon the population.  Nevertheless, my experiences have been challenging.

In the early 1990’s, when I believed that Pitney Bowes could spend less on health care, increase employee contributions, improve health, and improve employee satisfaction, I was perceived as a naïve person going against several decades of conventional wisdom.  Even today, those who believe we can increase health, reduce costs, provide universal, affordable health insurance and improve quality and decrease government budgets are perceived as unrealistic.

I had to fight conventional wisdom, although there was good research to support me, the Dartmouth Atlas work led by Dr. John Wennberg, just as there is good evidence today.  However, my point of view was so threatening to those who had built careers on marketing services consistent with a different point of view that they fought me and the evidence.  I was right, and I believe that the Pitney Bowes experience is broadly applicable.  I believe that the reason Washington lawmakers have not tried to apply it broadly is that it threatens more deeply-held beliefs about the role of government.

When I believed that Pitney Bowes would need to sue the U.S. Postal Service for violating our contract rights in the 1990’s, almost everyone thought I was misguided, including, in the beginning, my general counsel.  Over time, the management and the board of directors supported me, the lawsuit was filed, we settled, and moved on.  Years later, I spoke with senior postal officials who told me that they felt I had no choice but to do what I did, but that their colleagues did not believe we had the courage to file the lawsuits.  At the time, my view was influenced by the notion that the Postal Service’s actions were based on the perspective that we were simply their agent, and that they should control everything about the mail system.  My position was that they were public servants entrusted with specific responsibilities relative to mail, and had inherently limited powers to go beyond that.  This was not just a test of power; it was a philosophical difference about the role of government-operated services.

In 1999, two start-up companies challenged us with online postage solutions. My chief operating officer, Marc Breslawsky, and I were in a minority among the senior team in believing that these companies posed no threat to us.  Many employees and high-level executives, one or two board members and many shareholders told me that the world had changed and that I was in danger of ignoring potentially disruptive innovation.  The reason Marc and I turned out to be right is that we understood that disruptive technologies are successful only when they are superior to the older technology they replace and when they can be marketed profitably.  Neither condition was met.

In 2003, I had my toughest challenge of all.  I recommended to our management and our board of directors that we exit the non-core financial services business.  The reasons for not exiting seemed compelling: we would experience lower earnings per share, lower net income, lower cash flow and lower investment return immediately after we would complete a sale or spin-off.  Moreover, the exiting process would require audits for 10-20 year-old leasing transactions that would create the risk of having to change the accounting for transactions because they were so old that the documentation might not exist or that people’s memories about why they made certain decisions would have faded.

The only argument in favor of exiting the business was the longer-term, hard-to-measure risk of being in the financial services business.  It took me three years to complete the process, and I had to overcome opposition from many who weighed the risk probabilities differently from the way I did.  We completed the sale in July, 2006, and, fortunately, were out of the business when the financial markets began their collapse a year later.  Those who disagreed with me were not wrong about they believed could happen, but they could not fathom how bad the financial market collapse could be, and what effect it could have on the company’s stock price and prospects.

I could give many other examples of where I took a contrarian position, and was perceived to be on the wrong side of the argument, but, suffice it to say, being visionary is not always a comfortable place to be. All of these situations were different in terms of why I had difficulty, but they had certain common characteristics:

• I was not perceived to have any special knowledge or expertise, so, despite my brainpower and authority position, others felt that they could look at the same situation and have equal or better insight. In each case, I had to get them to reinterpret common facts.
• My position did not lack for clarity or simplicity.  It was not a communication problem.  It was a difference of perspective or philosophy.
• The opposition often sprung from much deeper points.  What was at risk was not just the specific issue, but some bigger fear or anxiety, whether it was upsetting a broad world view, putting stakeholders at risk of being criticized or sued for a wrong turn, or calling into question how people were earning their livelihood, or even just weighing risks differently.

I have concluded that I really could not have done anything differently, except to have understood the difficulty going into these situations. That’s just the way visionaries have to operate.  As I have gotten older, I tend to take these situations, which, fortunately, do not come along as often, less stressfully, and just recognize that seeing the world differently is a mixed blessing.

I met the President four different times before he was elected, three of those times at National Urban League events. President Obama struck me as a person with virtually unlimited growth potential and tremendous intelligence and character, and I still believe he has those qualities.

At the same time, I remind myself that he had no executive experience of any significance before he secured his first executive job, being President of the United States.  I expected him to make some rookie mistakes because of his inexperience as a chief executive, and he has.

For example, one lesson I repeatedly learned as the CEO of a large company is that the CEO’s words and actions are under a magnifying glass continuously, and he or she has to watch every word and action to avoid unintended consequences.  The President has this problem magnified many times beyond what I confronted.  When the President made an off-handed comment that he did not believe it was a good idea for companies to use taxpayers’ or shareholders’ money to take management or sales recognition trips to go to Las Vegas and stay at luxury casino hotel, he was trying to attack wasteful management and sales junkets.

However, many more reward and recognition trips were cancelled because business executives got intimidated by the President’s remarks. Many of these trips were rescheduled in other locations not as visible as Las Vegas.  In Las Vegas, the losers were the employees of those casinos, many of whom are single mothers working in physically demanding jobs.

The second, much bigger, rookie mistake was the President’s handling of the health care issue.  He overreacted to the lessons of the Clinton health care debacle of 1993.  Whereas the Clintons shut out Congress from the process of developing the legislation, President Obama gave up too much control to members of Congress who had no natural leader to bring them together.  I learned the painful lesson not to delegate critical tasks to unaccountable groups and committees.  There has to be a single person accountable to deliver the results, and that person and I needed to be aligned.

The Congress is not a hierarchical organization with a single accountable policy leader.  It has spokespeople and leaders who facilitate the assembling of majorities, but the legislation never had a single champion who had a clear set of strategic priorities given him or her by the President.  Former Senator Daschle could have played that role had he been selected as HHS Secretary.  Senator Kennedy also could have played that role, but he was terminally ill. Ultimately, an issue as critical and as divisive as health care cried out for single-point responsibility below the President.  He did not create that accountability, and, as a result, he lost control.

A leader has to understand that every decision made will be judged against the leader’s stated core values.  The recent “compromises” such as the one that exempted unions from the “Cadillac plan” excise tax was extremely clumsy in the way it was handled.  I recall reading that Andy Stern of SEIU made some comment to the effect that the unions contributed over $60 million to the President’s election campaign and expected something for it.  This comment suggested that the President and the Congress were compromising their principles to pay back powerful supporters. Along with the other “compromises,” which had no apparent logic other than to secure votes, this deal suggested that the President was not driven by principles or values, but by the desire to “win,” which was not the way he portrayed himself during his campaign or during most of the first year of his presidency.

The biggest issue President Obama and government officials have at all levels is the horrific misallocation of taxpayer money, especially stimulus money that went to states to enable them to preserve a number of inefficient processes and jobs.  As a person who has visited government offices frequently over the years and who was in a business that dealt extensively with government agencies, I believe that the fundamental problem of government is that elected officials decided that public sector jobs were a way to bring people into the middle class, whether or not they had the capabilities and the performance to merit being there.

The whole debate about performance management of teachers is the most visible example of this, with the Connecticut Educational Association (a union that represents teachers in many communities here in Connecticut) fighting so aggressively to keep teachers from being evaluated on performance that it will forego significant federal grants from the “Race to the Top” program.

However, this pathology goes far deeper.  At least the teachers do a real job, and, arguably, most of them deserve to be paid at a good, middle-class level.  What I observe as I encounter government functions is the phenomenon of “make-work” jobs, that is, jobs that, in a competitive or private sector economy would not exist.  I remember visiting the state office building in Sacramento, California, in 2003, when the State already had a huge and growing budget deficit.  When I entered an elevator, I was dumbfounded to encounter a uniformed elevator operator.  The last time I recall seeing elevator operators was back in the early 1960’s at department stores.

The ultimate bad “make-work” job, in my opinion, which symbolizes everything wrong with government, is the highway toll collector.  When automated technology could eliminate the need for toll collectors, government retain congestion-creating toll plazas and collectors.

President Obama needs to set an example of leadership by confronting the fact that too many people have secured middle-class compensation and benefits solely because they were lucky enough to get a unionized public sector job.

I hope that he does so.  He has shown great moral courage in supporting and energizing the education reform movement.  Whatever else he has done wrong, he has gotten this right, and deserves a lot of credit.

He also shows a great deal of thoughtfulness in how he presents complex issues, and made some good early moves in health information technology, prevention and wellness, and health care quality.

He needs to show similar courage and foresight across a far greater range of issues.  I believe President Obama has the capacity to grow into a great president, but he must learn from what went right and wrong in his first year.  It is most important what he does now, particularly in understanding what the voters have told him in the recent elections in Virginia, New Jersey, and Massachusetts.

What do these two situations have in common?  In both cases, a party to a dispute values continuation of the status quo and control more than they do economic benefit.

The Baseball Free Agent Negotiations

In 1976, after nearly 75 years of baseball operating under the legal notion that owners could permanently force players to contract with the same team year after year or be prevented from playing Major League Baseball, arbitrator Peter Seitz ruled that the standard Major League contract only allowed owners to renew the contract for one additional year, not perpetually.

As a result, the owners had to bargain with the Players’ Union over the terms of free agency, that is, when and how players could offer their services competitively.  One owner, Charlie Finley, proposed publicly that every player should be able to be a free agent every year.  As Miller said:

“The moment I heard Charlie’s proposal, I was worried that the owners would agree to it. He understood Economics 101.  If you made all the players free agents, every year, they would be competing against each other for a limited number of jobs.  It would not have been in the players’ interests.”

Using the laws of supply and demand, salaries would be depressed.  Instead, by having a more limited free agency, which ended up being in the agreement, the few free agents available every year were subject to competitive bidding that drove up salaries and severely hurt the economics of owning a baseball team for many owners.

Why did the owners reject Finley’s proposal?  As author Rob Neyer, in his book, Big Book of Baseball Blunders quoted Miller,

“ I think they (the owners) couldn’t envision an environment in which they no longer controlled the players.  It was not just about the money. They were accustomed to saying, “You must play for me or you can’t play professional baseball for anyone anywhere in the world.” That was a tremendous power and I suspect they didn’t want to relinquish it too abruptly.”

In effect, the owners valued the appearance of power and control, but did not understand that they were severely compromising their short and long term economic interests in so doing.

The Union Opposition to the Tax on “Cadillac” Health Plans

The opposition of many labor unions to the tax on high-cost health plans is in the same category as the owners’ opposition to unlimited free agency.  They are fighting to keep control of an economic model that is not in their best interests financially.  If the Dartmouth Atlas research has a single message, it is that more aggressive health care is not better care, and does not deliver better health.

Medical benefits are not like pension, 401(k) or even life insurance benefits.  In the case of pension, 401(k), and life insurance, the more the employer pays, the more the union member is enriched.  In the case of medical benefits, the more the employer pays, the more an outside doctor, hospital, or insurance company is enriched.  Whether making outside medical providers richer translates to better health care or health for union members is pure accident.

Think about it for a moment.  If I am a union member and go to the emergency department of my local hospital for a sore throat, instead of going to the local retail walk-in clinic, my employer pays $1,000 instead of $50 for me to get examined and to get a prescription for an antibiotic.  Am I better off for having triggered a $1,000 expense instead of a $50 expense for the employer?  Clearly not.  Yet, in many instances, these Cadillac plans cover emergency department and hospital care at 100%, but require a $20 pay for a visit to a retail clinic.  If the health plan created a $100 co-pay for a non-urgent emergency department visit, the union member would go to the retail clinic, not the emergency department, the employer would pay less, and the union member would have an opportunity for some form of gain sharing.

Wouldn’t I be better off if the employer paid $50 and gave me $400 worth of salary, pension benefit, 401(k) contributions, or life insurance premium money?  That’s what we did at Pitney Bowes in the early 1990’s in weaning our employees off these rich, dysfunctional health plan benefits.  They got more cash in their pocket, as did we, and the only losers were those providers who had benefited from overcharging us in the past.

Why do these unions not see this?  Going back to the Marvin Miller commentary, I suspect it is because they do not want to appear like they are “giving up” something, even if they could do better for their members by making a concession on the Cadillac health plan tax.  If I were they, I would propose a subsidy for pension, 401(k) or some other real economic benefit in exchange for “giving up” on the Cadillac health plan tax issue.  Their current opposition seems very misguided.

Many elected officials do not have the political will to address fundamental structural economic and political issues.  We built an economy after World War II promising middle class wages for all Americans, but without the foundation of skills and educational capabilities to make such promises sustainable.  Public sector labor unions and unions in heavily politicized private sector industries like the automobile industry, successfully negotiated collective bargaining agreements allowing people with very low skills and educational attainment to secure middle class wages and benefits, and protections against downsizings, even as our economy has had to become more globally competitive.

Private sector companies with these less productive and over-staffed workforces are uncompetitive.  The public sector has become too expensive to support for the level of services we receive, as John Donahue of Harvard’s Kennedy School of Government powerfully describes in his book The Warping of Government Work.  So why do we not address these structural problems?

Elected officials do not get re-elected by allowing large numbers of individuals to experience pain. Under-skilled people in private industry or the public sector would either be unemployed or employed at well below middle class wage levels if they freely competed in a globally competitive sector of the economy.

The long-term answer is better education and re-skilling of our population.  Unfortunately, labor unions control much of our education system, and most resist the kinds of education reforms, like aggressive teacher performance management, that would make our education system able to fulfill this mission.

Politicians and labor leaders cannot easily act to address these issues because the highly competent teacher and the teacher who should be downsized have the same voting power. In fact, the more a labor union is comprised of people overpaid relative to the marketplace, the more the union leader will be compelled to resist fundamental change.  Elected officials representing dying communities needing to make structural change have constituents least likely to want change.

So what’s the answer? First, acknowledge the problem openly. Second, recognize that even among labor unions or dying community populations, there are many change champions from whom support can be obtained. Third, craft solutions that minimize the number of losers. Fourth, recognize that not everyone in an overpaid, under-skilled population is motivated to retain their specific compensation and benefit packages.  People are diverse, and there needs to be an effort to take advantage of that diversity, rather than ignoring it.

I am less optimistic than many about the long-term recovery of our economy.  We have difficulty making clean, fast, directionally powerful decisions because we have created big centrally controlled systems with powerful interest groups able to prevent actions that would have adverse effects on them even in the slightest way.  That is why the Obama Administration has had to resort to a lot of ugly political horse-trading to pass a single health care reform bill in the Senate, and why the health care reform process is so ugly.

For the big structural issue I described, there will need to be three broad-based tactical approaches:

• Find ways to dramatize the pathology by personalizing it.  Think about the number of laws that have passed because of the dramatization of a particular victim of a pathology.  We have “Amber alerts” because a girl named Amber was kidnapped.  We have “Megan’s law” to address violent sexual abuse. The public face of government employees that receive excessive pay and benefits is usually a heroic police officer, firefighter, or teacher, not the Massachusetts toll collector who can retire at age 45 with full pension and retiree medical benefits after 23 years of service.  If the public realized how much those retirement benefits cost and how the public is supporting obsolete jobs that could be replaced by automatic toll collection technology that would eliminate toll plaza traffic jams, their attitudes about these benefits could be very different.
• Build grass-roots support through fact-based advocacy.  Our society has been very successful in changing public attitudes with grass roots campaigns on issues like smoking, driving while intoxicated, and seat belt usage.
• Use the power of entertainment.  I am involved with film and reality TV investments because I need to learn about how to use entertainment to change society.  Neil Baer, the executive producer of Law & Order SVU, is a physician who cares deeply about health care reform.  His show is a powerful platform to address many issues associated with sexually transmitted diseases and violence.

Over the next 12 months, I will be doing a fellowship at Harvard University to help myself learn and grow in a way that will enable me to contribute creative insights and to drive actions that will help lead the way in this much more difficult environment.

The only thing that happened as I anticipated was that I would disengage emotionally from Pitney Bowes very rapidly, because that is who I am.  Once I leave an organization, I leave with fond memories, great friendships, and insights of lifelong value, but I leave the organizational responsibilities completely behind.  I am not a person who is nostalgic about what I once had or did, and this was no exception.  Other than that, everything that happened was either a surprise or a disappointment.

• The biggest disappointment was the way the health care legislative process transpired.  As the leader of a coalition created late in 2008 who intended to play a major role in the health care reform debate, I came to the conclusion that any serious advocacy was a waste of time.  The legislation had some good elements, such as an enhanced focus on prevention, thanks to Senators Dodd and Harkin and those colleagues on both sides of the aisle who care about prevention, and there were some modest efforts to improve health care quality and delivery.

However, the entire focus on universal, affordable insurance was misdirected.  First, we cannot give everyone affordable insurance until we attack the fundamental drivers of cost, which was not done.  Second, the designs of the individual and employer mandates were flawed, and will end up taking us in the direction of greater financial insolvency, like Massachusetts.  Third, the public option is nothing more than an extreme expression of distrust a significant minority of our elected official population have toward insurance companies.  Their distrust may or may not be well-founded, but the public option is the wrong way to solve the problem.

It became clear to me early in the year that positions had largely hardened, that the legislative process was about scoring political points at the expense of others, and that many good principles would get sacrificed to get 60 votes in the Senate, which is what has happened.  There was very little interest in listening to new points of view once the legislative battle began.  So I withdrew, other than participating in attempting to get one very sensible amendment put into the legislation.

• My other disappointment was seeing Wyeth, a company whose board I joined in April 2008, disappear as a result of an unsolicited tender offer from Pfizer.  The board did the right thing for shareholders to negotiate the offer we ultimately accepted, and Pfizer will clearly have more capacity and cash to fulfill the promise from the research Wyeth had under way.   However, it is sad to see a great company with great people disappear, and to see some of the best of those people lose their jobs as a result.

• I was surprised how good the technology for doing my work has become.  It is easy to make appointments and to schedule travel.  It is relatively easy to be a mobile worker, and to put together speeches, presentations, resumes, multi-media communications, and research materials.  If I were in charge of any large organization, I would be pushing the IT function far more aggressively to use the technology that is now available and reliable.  I also would use assistants far differently than I did when I was at Pitney Bowes.

• I was amazed at the creativity, the profit focus, and the productivity of the people at the small, start-up companies with which I had contact.  Dossia, the personal health record business started by eight companies, including Pitney Bowes, has made amazing progress in the past year, although it still has a long way to go, and has a superior offering to its competitors.

• I am watching many large organizations aspire to achieve more entrepreneurial, fast-moving decision-making by downsizing rapidly.  I believe that is an extremely difficult result to achieve.  Pitney Bowes has been an unusually entrepreneurial organization, which generally maintained its ability to innovate, even as it downsized during my tenure.  However, getting acquainted with many large organizations all around the country, I am seeing those who remain inside these organizations getting more cautious as they watch others lose their jobs.  Rather than getting out more with customers and trying to learn more about what works, they are getting more of a bunker mentality, spending more time in internal meetings, and taking more time to make simple decisions at a time when those who move faster get bigger rewards.  I believe many large organizations will fail once the economy improves, simply because they have been too slow afoot when the opportunity for capturing rewards from innovation was greatest, which is the time we are in right now.

• I have become far more resourceful, and have watched our children became far more resourceful, in responding to these difficult times.  My older son had his car stolen when he moved into a new apartment in Los Angeles, but proceeded to buy a less expensive, older car and pocket the difference between his insurance proceeds and the lower selling price of the newer car.  My younger son became far better at online selling, and made significant money during the last few months he was home.  More importantly, he learned a lot about the need people have to buy more high-quality used items, and the way they need to be treated as customers.  My daughter became a much more confident musical performer and increased her ability to earn money and to do community service.  They probably would have found these skills anyway, but the bad economy accelerated their learning curve.

• I also learned to think about new business opportunities in a different way.  For example, could charities benefit from better tools for online auctions to get more unrestricted money?  Would we all benefit from lower-calorie, organic, healthier foods that people eat on the run?  These questions prompted me to make small investments in two start-up companies.

• I came to realize that my real passion is helping improve the health and well-being of people, and that the best way to do that is to work on the non-medical drivers of health.  I believe individual and community interventions on the prevention and wellness side will be key to this.  This insight is leading me to a very different plan for 2010: a fellowship at Harvard, a focus on community health interventions here in Connecticut, and a focus on investments in the performing arts, where the telling of stories changes attitudes and behaviors faster and more permanently.

• Finally, I started to engage in some projects that will be fun, and hopefully, make money and help get me launched in some new directions.  My older son and I completed a film script which we are now trying to market, (and would welcome any reader’s help), I have co-invested in a completed movie called Fog Warning ( a suspense-thriller/horror film), and am involved with a reality TV incubator/production company.

2009 was a crazy year in many respects, but I actually felt liberated by my ability to withstand what it brought and to craft new ways of solving problems and finding opportunities.  2010 should be an even more interesting year.

In my next blog, I will get back to talking about broader political, social, and economic trends that will provide a backdrop for some of my thinking.

“Within hours of announcing its findings, the Task Force faced a barrage of attacks from women, doctors, journalists and politicians across the U.S. The onslaught was swift, harsh, and emotionally charged.”

She goes on to point out that the Task Force was accused of making its decision based on a desire to save healthcare dollars through “rationing,” a term injected into the discussion by lawmakers, such as Congresswoman Marsha Blackburn, who said:  “This is how rationing begins.  This is the little toe in the edge of the water.”

On the surface, this appears to be a recommendation purely based on the economics of doing additional mammograms and getting a relatively low yield in term of saved lives.  Although, as a society, we can and should allocate scarce health care dollars based on where they can do the most good, it is clear that we are not ready to have a rational debate on health care based on traditional cost-benefit analyses.

However, what got lost in this discussion, which Ms. Searles characterized as advice “understood by many as a step backwards for women” is that there are sound medical reasons for this recommendation.

The Task Force’s recommendation could have been based on two medically-based rationale, aside from the psychological stress of having received a false positive reading from a mammogram:

• The breast biopsy which routinely follows a screening that detects the possibility of cancer entails medical risks of increased infections and bleeding, as noted on the Mayo Clinic web site. As a person who received a false positive on a prostate cancer screening a few years ago, I can testify to the risks of excessive bleeding.  For anyone taking medication for cardio-vascular disease, this risk is addressed by requiring the patient to suspend taking blood thinners for at least 10 days before the biopsy and for several weeks after it.  For a patient who already has cardio-vascular disease, that decision to suspend the taking of medication has some potential for increasing the risk of blood clots.
• The radiation to which a woman is exposed in receiving a mammogram has a potential cumulative impact in increasing her risks of cancer.  That risk is minimized by having the mammograms start at age 50, but increases to some degree by starting the mammograms at age 40.  As an article in the December 15 issue of The Wall Street Journal written by Shirley Wang cites two studies published in the Archives of Internal Medicine which demonstrate that exposure to increased radiation from CT Scans significantly raises the risk of cancer for many people.  In the article, Dr. Amy Berrington, the investigator from the National Cancer Institute who led the studies, notes that while the radiation exposure from mammograms is far lower than for CT Scans, women need to take into account the increased risk of getting cancer from the cumulative exposure to radiation from multiple tests.

To the degree that women have a benign tumor, but elect to get surgery to remove the tumor through a mastectomy, there is also the normal risks from any surgery and complications from it, including the risk of acquiring an infection at the hospital at which the surgery is performed.

This is not a simple decision, and it particularly illustrates one of the fundamental paradigm shifts Americans will need to make in thinking about health care.  There is a current perception by most Americans that more care is always better care, and that an attempt to scale back health care is a “takeaway.”  The argument that we cannot afford unlimited health care is a non-starter for those who believe that they deserve every bit of care that is available.

However, if we can start to get them to understand that, in many instances, more aggressive care can produce worse medical outcomes, we have a fighting chance to bring health care costs under control.  Our lawmakers, including HHS Secretary Sibelius, who distanced herself from these revised guidelines by saying that women should keep doing what they have always been doing, did a disservice to the long-term debate on how we get the best health care at the lowest cost for everyone.

The goal should be to get the optimal care, not the most aggressive care, for everyone.  Better yet, the goal should be to improve health, not rely on the health care system to correct preventable health problems.