Washington and Lee University’s Speaking Tradition is a long-standing campus custom where students, faculty, and staff greet each other with a “hi” or “hello” while passing on campus. Promoting a welcoming, friendly atmosphere and a sense of community, it reflects the university’s values of civility and personal connection.
Key Aspects of the Speaking Tradition:
Origin & Purpose: It is a deeply embedded, informal custom meant to foster community and ensure every individual feels acknowledged.
Application: It involves smiling, nodding, or saying hello, especially when walking along the historic Colonnade or paths.
“Say Hey” Day: Kathekon students often promote this tradition on campus.
Challenges: The tradition faces pressure from technology, such as smartphone usage and headphones.
Distinction: The “speaking” part refers to greeting others, not public speaking.
The tradition is considered a “positive chain reaction” that helps make the university feel like a welcoming community.
This insightful observation from science fiction author Robert A. Heinlein suggests that the health of a civilization is best measured by its smallest interactions, not its biggest conflicts.
Here is a breakdown of its meaning:
Civility as Social Glue: Politeness and “gentle manners” are more than just etiquette; they represent a fundamental respect for the social contract. When people stop showing consideration in “minor matters,” it signals that they no longer value their neighbors or the community at large.
The Subtle Rot vs. The Loud Event: A riot is an explosive, often temporary, reaction to a specific problem. However, widespread rudeness is a slow, pervasive rot. Heinlein argues that this quiet erosion of decency is more dangerous because it signifies a deep, internal collapse of shared values that is much harder to repair.
The Foundation of Order: Large-scale order is built upon small-scale respect. If a culture loses its ability to maintain daily politeness, it has lost the very foundation that prevents total chaos. Once mutual consideration is gone, the culture is essentially already “dead.”
In essence, when a culture stops practicing common decency in “minor matters,” it is already “dead”.
In second episode of the HEALTH CARE un-covered Show, we walk you through the most recent earnings reports of seven of the largest for-profit health insurance corporations in the country.
Every three months, the nation’s largest health insurers release earnings statements filled with crammed financial tables, investor language and Wall Street jargon. Most people never see them. Even fewer try to understand what they really reveal about how the U.S. health care system works.
In second episode of the HEALTH CARE un-covered Show, we do something no one else does: walk you through the most recent earnings reports of seven of the largest for-profit health insurance corporations in the country — UnitedHealth Group, CVS Health (Aetna), Cigna, Elevance, Humana, Centene and Molina. As you’ll see, the results paint a striking picture of how powerful and profitable Big Insurance has become.
Together, those companies collected nearly $1.7 trillion in revenue in 2025, about $175 billion more than the year before and generated more than $54 billion in profits. Yet despite the record financial performance, the companies covered roughly 10 million fewer people than they did in 2024 – and ever-increasing chunks of their revenues are now coming from Americans’ tax dollars.
We show evidence of a trend reshaping the health care economy: self-dealing through insurers’ vertical integration and their huge government contracts, which accounts for much of the industry’s growth. For example, UnitedHealthcare now gets more than 77% of its revenue from government programs such as Medicare Advantage and Medicaid. As a reminder, Medicare Advantage is not traditional Medicare but a very profitable privatized version of the program that’s funded by taxpayers and that last year overpaid insurers by $84 billion.
We also examine stock buybacks. Between 2015 and 2025,these seven companies spent more than $137 billion buying back their own shares, a move that boosts earnings per share and enriches shareholders and top executives. That’s $137 billion that could have been used to reduce premiums and out-of-pocket expenses but went into the pockets of investors instead.
To put the numbers in perspective, we compare these insurers with some of America’s most recognizable corporations — from Chevron and PepsiCo to Bank of America and Salesforce. Most of the big seven generate more revenue than these household names. And many of the insurance conglomerates are growing faster than companies like Target, Uber, Disney and Starbucks.
We take viewers inside Wendell’s office to make sense of Big Insurance’s dense 2025 earnings reports.
You won’t find an analysis quite like this anywhere else.
This episode has been re-uploaded with corrected numbers. For instance, Disney was listed as having revenues of $274.9B in 2025. The correct number is $94.4B. The percent change used in the original video (+80%) was correct.
In Episode 1 of the HEALTH CARE un-covered Show, we examine what may be an inflection point in the health insurance reform debate. Plus, we’re joined by pollster Madeline Conway of Impact Research.
The volume of claims is treated as proof of misconduct, despite the fact that the statute imposes no limit on IDR submissions and explicitly allows for repeated use when payment disputes continue. Further, insurers base this claim on estimates of IDR submissions that were deeply flawed, forecasting nationwide utilization on the experience of one state.
The message is unmistakable: providers are not accused of breaking the NSA, but rather of utilizing it too effectively. For instance, insurers claim that providers submitted “thousands” of IDR disputes, including nearly “200 overlapping proceedings for the same services” across both the federal and state IDR systems, and batched an average of 66 separate items or services into a single IDR filing: Insurers describe these statistics as “overwhelming,” despite the fact that each dispute is linked to a corresponding payment denial or gross underpayment.
Recasting Physician Disputes as “Fraud”
Each lawsuit hones in on physician NSA disputes and castigates them as some kind of “fraud” or “abuse.” The HaloMD lawsuits are a prime example of the insurer taking an NSA dispute, challenging the disputes eligibility for arbitration and then recasting it as “fraud.” What these lawsuits notably fail to recognize is that the outcomes of IDR are determined by independent arbitrators, called certified IDR entities (IDREs), not by the providers themselves.
According to CMS’s public-use files, 82% of 2024 disputes and 80% of 2025 disputes were found eligible for arbitration. This is orders of magnitude greater than what the government had estimated. What these numbers tell us is that the problem with the volume of disputes is not a conspiracy by doctors to abuse this system, but systemic underpayment by insurers, as we have reported.
In the lawsuits, insurers concede that it was the arbitrators, not the providers, who rendered the final awards in these disputes. Insurers also consistently and publicly voice their concerns that NSA awards surpass the Qualifying Payment Amount (QPA), often describing results that are ‘multiples’ of the median in-network rates or even exceeding billed charges. Insurers assert that IDR awards are excessive, “citing CMS data showing that they are on average slightly over 300% of the QPA” of the QPA.
However, a recent analysis shows that the reported QPAs consistently underestimate the actual median in-network rates, with an average discrepancy of 290% in cases where such discrepancies are present. A pervasive problem reported by providers and evident in the public-use files shows thousands of initial offers for payment that amount to less than a dollar. In one documented case involving high-acuity emergency care, the insurer calculated the QPA at $0.01. The arbitrator ultimately awarded $1,196. The gap was not evidence of an inflated charge; it was evidence that the benchmark itself was flawed.
This underestimation is attributed to calculations controlled by insurers, insufficient oversight, and the omission of market factors that Congress mandated arbitrators to consider.
Simply disagreeing with an IDRE’s assessment does not equate to fraud. Rather than modifying payment practices, enhancing negotiations, or pursuing legislative clarity, insurers have opted for litigation as a tool to crush providers while claiming unfavorable arbitration results as evidence that the system is being “manipulated.” They are both arsonists and firefighters.
The Litigation Boa Constrictor
Across jurisdictions, insurers clearly claim that defendants engaged in “coordinated enterprises,” “strategic partnerships,” or “associations-in-fact,” alleging RICO violations founded on the concurrent use of IDR, common billing vendors, and simultaneous filings, even though there is no statutory restriction against coordinated IDR usage or shared administrative frameworks.
The recurring themes in these filings are hard to overlook. In the last 12 months, there have been 11 lawsuits targeting use of the No Surprises Act, four alleging RICO violations and five seeking treble damages.
So far, this coordinated lawfare effort includes the following suits:
Blue Cross Blue Shield of Texas v. HaloMD et al. (E.D. Tex., Aug. 2025)
Blue Cross Blue Shield of Texas v. Zotec Partners, LLC (E.D. Tex., Dec. 2025)
Anthem Health Plans of Virginia v. AGS Health / SCP Health et al. (W.D. Va., Nov. 2025)
Community Insurance Co. (Anthem Ohio) v. HaloMD et al. (S.D. Ohio, June 2025)
Blue Cross Blue Shield Healthcare Plan of Georgia v. HaloMD et al. (N.D. Ga., May 2025)
Anthem Blue Cross (CA) v. HaloMD et al. (C.D. Cal., July 2025)
Anthem Blue Cross (CA) v. Prime Healthcare entities (C.D. Cal., Jan. 2026)
UnitedHealthcare of Pennsylvania, Inc. v. NorthStar Anesthesia of Pennsylvania, LLC (E.D. Pa., Dec. 2025)
UnitedHealthcare Insurance Co. v. Maui Emergency Care Physicians, LLC (D. Haw., Jan. 2026)
United Healthcare Services, Inc. v. Concord Company of Tennessee, PLLC (W.D. Ky., Jan. 2026)
UnitedHealthcare Ins. Co. v. Radiology Partners, LLC (D. Ariz, Aug. 2025)
These prosecutions follow a distinct pattern of allegations: strategic batching, simultaneous filings, excessive offers, false statements, and an alleged conspiracy to take advantage of IDR. Even when the factual circumstances vary, the narrative remains the same. This consistency indicates not an independent discovery of wrongdoing, but a calculated strategy.
The targets of these lawsuits represent the full spectrum of organizations utilizing the NSA. From revenue cycle management (HaloMD) to large physician staffing organization (SCP) to small physician practice management group (Concord Company), insurers are constricting the entire provider community hoping to alter the NSA through legal outcomes.
Litigation as Press Release
The litigation involving Prime Healthcare highlights this strategy particularly well. In this case, insurers openly admit that hospitals are utilizing IDR instead of balance billing patients, precisely what Congress intended, yet they still label this behavior as abusive because it led to payments that were higher than what insurers were prepared to offer. Lawful reliance on IDR is recast in this complaint as “extractive,” “indiscriminate,” or “profitable abuse,” as if the issue lies not with insurer underpayment but with the presence of an independent referee who has the authority to disagree with them.
The impact on the real world is far from just a theory. These lawsuits aim for treble damages, annulment of arbitration awards, and injunctions intended to completely deny providers future access to IDR. The message from insurers is clear: engage in the IDR process established by Congress, and you will face consequences. Providers who utilize IDR are not seen as legitimate participants in a federal program; instead, they are viewed as targets, labeled as racketeers, pulled into costly litigation, and compelled to defend their right to contest underpayment. These lawsuits serve as a deterrent and act as a warning to discourage providers from engaging in IDR by making the costs of participation excessively burdensome.
Breaking the NSA Balance
No lawsuit will have more far reaching consequences for physicians than UnitedHealthcare v NorthStar Anesthesia (the insurer has filed five similar lawsuits). While this suit follows the usual script of allegations it aims for something more pernicious than unflattering headlines: declaratory judgment of fraud for ineligible disputes. The eligibility of an NSA dispute rests solely with CMS and the independent arbitrator – they are administrative. Physicians have repeatedly shown that insurers withhold critical information needed to determine a claim’s eligibility, the result being that occasionally physicians will dispute a claim that is ineligible for arbitration. According to CMS, with more than 80% of claims sent to arbitration being determined as eligible, these mistakes are the exception, not the rule.
However, if UnitedHealthcare is granted the relief it seeks, insurers will be able to challenge dispute eligibility in court, outside of arbitration, and receive direct judgments of “fraud” against physicians who have filed ineligible claims. A declaratory judgment of fraud would not simply reverse a payment. It would create precedent allowing insurers to relitigate administrative eligibility decisions in federal court and seek damages for disputes that arbitrators have already accepted into the federal process. This elevates an administrative error into reputational and legal risk that no physician practice could withstand.
The NSA’s public policy goal of removing patients from billing disputes, was buttressed by leveling the playing field between physician practices and insurance behemoths. The sweeping effects of this case will fundamentally alter the scales in favor of insurers and not just chill, but shut out doctors from obtaining fair reimbursement.
Shifting the balance of power
This situation should alarm policymakers as well as doctors and their patients. It embodies the risk of extended, multi-faceted litigation initiated by trillion-dollar insurance conglomerates targeting individual physicians, small practices, and safety-net hospitals that do not possess equivalent resources.
This pressure does not safeguard patients. Instead, it discourages providers from contesting underpayment, shifts the balance of power firmly back to insurers, and dissuades the use of the very system intended to resolve disputes and protect patients. In the meantime, insurers leverage extensive financial resources to maintain coordinated litigation efforts while depicting providers, especially those offering emergency care, as wrongdoers for employing the only legal remedy available.
Ultimately, these legal actions are not aimed at preventing misconduct. Instead, they focus on altering market structure. By transforming the routine application of IDR into a significant litigation risk, insurers are indicating that independent providers who challenge payment terms will face penalties instead of negotiations.
The foreseeable outcome is the consolidation of providers: small practices, emergency physician groups, and safety-net hospitals will be compelled to sell, affiliate, or close rather than endure the costs and uncertainties associated with defending against repeated federal lawsuits. As we’ve reported, Optum now employs more than 90,000 clinicians. Simultaneously, this approach accelerates the vertical integration of insurers, directing care toward entities that are either owned or aligned with insurers, which are shielded from payment disputes and arbitration. Within this context, the courts do not serve as a venue for resolving conflicts; they function as a mechanism for enforcing market discipline. This undermines the fundamental objective of the No Surprises Act to balance bargaining power and, in turn, reinforces insurer dominance over pricing, networks, and access to care.
A law meant to protect patients and equalize bargaining power is being weaponized by insurers to suppress those who question insurer payment practices and, in doing so, to silence the underdog.
A wave of coordinated lawsuits is transforming the No Surprises Act’s arbitration system into a battlefield where insurers seek to intimidate physicians, rewrite the law and consolidate control.
As I have written, Congress passed the No Surprises Act (NSA) to safeguard patients from unforeseen medical expenses and establish a neutral, independent dispute resolution (IDR) process for payment conflicts between insurers and out-of-network providers. That design was meant to replace brinkmanship with an independent referee. What Congress designed as a neutral arbitration system is now being challenged by Big Insurance through coordinated litigation designed to narrow, intimidate, and ultimately reshape the law.
Major insurance conglomerates — including UnitedHealthcare entities, Elevance/Anthem affiliates and Blue Cross Blue Shield plans — have launched a coordinated series of federal lawsuits against providers, hospitals, and revenue-cycle vendors who have used IDR at scale. Employing nearly identical language, legal arguments, and allegations, these lawsuits are not isolated ordinary litigation. It is lawfare.
Narratively, these suits recast lawful engagement in the NSA’s IDR process as “abuse,” but functionally they are designed to intimidate physicians from seeking NSA protection. A Pennsylvania suit from UnitedHealthcare against NorthStar Anesthesia presents the most urgent and perilous threat to independent physicians. If Unitedhealthcare prevails, insurers will be able to obtain judgments of fraud against physicians who incorrectly file NSA disputes. The effects of this will be catastrophic for independent physician practices, who cannot afford to litigate against billion dollar behemoths that have armies of lawyers on staff and retainer.
If successful in these efforts, the insurers will further weaken physician practices and make them ripe for acquisitions, continuing the dangerous path of vertically integrated insurance corporations – and the further decimation of independent physician practices.
The “Flooding” Myth
The lawsuits all start in a similar fashion. Each one claims that the defendant “abused” federal legislation “designed to protect patients from unexpected medical bills” and asserts that “the IDR process has not functioned as intended.” This wording appears verbatim in cases filed months apart, across different jurisdictions, against completely different defendants. Insurers adopt the same basic allegation: providers or billing companies “flooded,” “overwhelmed,” or unleashed an “avalanche” of IDR disputes that insurers assert were ineligible.
Those characterizations are based on bad data. Before the NSA went into effect, the Departments of Health and Human Services, Labor, and Treasury projected that the independent dispute resolution (IDR) process would see roughly 17,000 disputes annually. In reality, the system received nearly hundreds of thousands of disputes in its first year. That mismatch didn’t happen by accident. The departments based their projections on New York’s experience with a state arbitration system, scaling the state’s dispute numbers nationally. But New York’s law relied on an independent benchmark called FAIR Health that sharply reduced disputes. This is a structural feature the federal law does not have.
A more realistic comparison was available at the time: Texas. Unlike New York, Texas operated an arbitration system without an external benchmark making it a better comparison for the federal No Surprises Act. In its first year, the Texas system received nearly 49,000 arbitration requests for a population of just under six million people. That experience should have been a clear signal that arbitration volume would be far higher than federal projections suggested. Insurers have used this modeling error to their rhetorical advantage in their litigation.
New data shows the U.S. is moving backward on coverage, not forward—raising a harder question: is the problem affordability, or priorities?
Will the U.S. ever provide health care for all its citizens?
The prospects are dim for enacting a system that provides services for the county’s entire population the way Europeans have done for decades. As the head of the German pharmaceutical association in Berlin once told me in an interview, “In the German system, nothing comes between us and our principle of solidarity.” I asked, “Even your profits?” “Not even our profits,” he replied.” Imagine any health care executive in the U.S., where the bottom line reigns supreme, daring to say a thing like that.
That interview with the German pharmaceutical executive came to mind again as I read the latest study from the Commonwealth Fund, which should be required reading for anyone interested in health policy and the future of the American system. The report by the Fund’s senior scholar, Sara Collins, said the Trump administration has “made it harder than ever for Americans to get good health insurance,” a conclusion that needs to be shared far and wide.
The administration itself predicts these changes will reduce enrollment in the Affordable Care Act marketplaces next year by 1.2 to 2 million people. The U.S. is falling backward in providing health care for all, a project that prompted Dr. Martin Luther King Jr. to observe long ago, “Of all the forms of inequality, injustice in health care is the most shocking and inhumane.”
At the Commonwealth Fund, Collins noted that those losses are on top of other changes expected to leave another 7.5 million people uninsured. Even though members of Congress hostile to the Affordable Care Act failed to repeal the act during Trump’s first term, Collins points out they still inflicted damage by whittling away at some of the law’s provisions. She reports that last year a majority of the public supported the Affordable Care Act’s enhanced premium tax credits, established in 2021. Republicans, however, did not pass legislation to extend those credits that helped millions of Americans, who now face annual premium increases of $750 to more than $4,000.
Does the destruction of the hard-won Affordable Care Act mean that a country as rich as ours cannot afford to pay for medical care like the rest of the world’s developed countries do, or does it mean those with clout don’t want those without to have health care? I am inclined to believe the latter.
That was not the only damage caused by the Trump administration. For example, a new rule for marketplace coverage increased out-of-pocket costs, eliminated special enrollment periods for those with low incomes, and put new restrictions on auto enrollment. In addition insurers raised premiums by 20% or more in many cases, hoping that those people who are healthy would not drop coverage and leave them with sick, and more costly, health plan enrollees. Such a strategy would be unheard of in countries with national health systems, where everyone is entitled to care.
“The Trump administration’s latest actions on the ACA marketplaces continue to make it as difficult and costly as possible for those with low and moderate incomes to get good health insurance and care they need,” Collins reported. “This will lead to more people with low and moderate incomes uninsured, underinsured, less healthy, and saddled with medical debt.”
Is this what Americans want for their health care system?
Nearly 47,000 comments hit regulators. Most weren’t written by seniors — they were engineered by insurers and their front groups.
When the federal government opened a public comment period earlier this year on Medicare Advantage payment rates for 2027, which were far lower than what private health insurers had expected from the Trump administration, something remarkable happened. Comments poured in at a record-breaking pace — nearly 47,000 in all, an all-time high for a Medicare rate notice.
Regulators took notice. A senior CMS official, perhaps trying to lighten the mood, joked that the flood of input might be “another innovation related to AI.”
It was a good line. But the reality was less amusing.
According to an analysis earlier this month by KFF Health News, about 82% of the more than 16,400 publicly available comments were identical to a letter that appeared on the website of a secretive advocacy group called Medicare Advantage Majority — a “dark money” organization that does not reveal its funders, other than to say it is “dedicated to protecting and strengthening Medicare Advantage” and is “powered by hundreds of thousands of local advocates nationwide.”
The letter warned that without higher reimbursements, seniors would face higher costs and fewer benefits. It was signed by thousands of people who almost certainly believed they were speaking for themselves. They were speaking for the industry.
The extent of the deception ran deeper than form letters. KFF Health News found at least one case that illustrates the tactic’s recklessness. Corenia Branham, a 90-year-old widow and cancer survivor in West Virginia, said she never submitted any comment to CMS — yet four form letters appeared online under her name. Branham, who isn’t even on Medicare Advantage, was unambiguous about her views: “I wouldn’t recommend it to nobody.” A spokesperson for Medicare Advantage Majority claimed she had responded to an ad on Facebook. Whether she understood that doing so would put her name on federal regulatory comments is another matter entirely.
Alongside the comment flood, insurers and MA associations funded research, launched ads, rounded up signatures, and met with government officials, submitting a barrage of comments arguing the proposed rule would be disastrous for payers and the seniors they serve. The Better Medicare Alliance, backed by the nation’s largest health insurers, led the charge. So did AHIP, the industry’s primary lobbying group. (And don’t believe for a minute that Medicare Advantage Majority wasn’t funded by the industry, too. In my old career in the insurance business I used to work with Washington propaganda shops to help set up front groups like that.)
The advertising blitz was impossible to miss if you spent any time in Washington. If you visited Washington’s Union Station in recent months and checked the monitor listing train departure times, you would be hard pressed to miss the large electronic billboards around them from an organization called the Coalition for Medicare Choices, another front group, featuring worried-looking seniors warning against cuts to Medicare Advantage. Despite billing itself as a grassroots organization, the Coalition for Medicare Choices was founded out of the same offices as AHIP. The Better Medicare Alliance — whose membership includes UnitedHealth, Humana, and Aetna — ran its own paid media campaign. The group spent over $13.5 million on ads, while yet another dark-money group added $2 million more.
What looked like a nationwide groundswell of concerned seniors was, in large part, a carefully coordinated pressure campaign designed to move our tax dollars — tens of billions of them – to insurance conglomerates that operate private Medicare Advantage plans.
This playbook is not new. It has a name: astroturfing. The term was coined in 1985 by Texas Senator Lloyd Bentsen, who described a “mountain of cards and letters” sent to his office demanding his support for a bill favorable to the insurance industry. “A fellow from Texas can tell the difference between grass roots and AstroTurf,” Bentsen famously said. “This is generated mail.”
Forty years later, the insurance industry is still running the same play — only now with the tools of the internet, AI-assisted drafting, Facebook ads, and front groups bearing names designed to sound like patient advocates.
I know this tactic well. I helped write the playbook.
For years, as a senior executive at one of the country’s largest health insurers, I watched — and participated in — campaigns that manufactured the appearance of public support for industry-friendly policies. The goal was always the same: to make regulators and lawmakers believe that ordinary Americans were rising up in defense of private insurance, when in fact it was the industry pulling the strings. We called it grassroots outreach. It was anything but.
Shooting the Messenger: The Campaign to Discredit MedPAC
Flooding the CMS comment docket with form letters was only one front in the industry’s pressure campaign. Another target was the independent agency whose numbers made the strongest case for reform: the Medicare Payment Advisory Commission, better known as MedPAC.
MedPAC is a nonpartisan congressional advisory body with no financial stake in the outcome of Medicare policy. As we reported earlier, MedPAC’s January 2026 status report estimated that Medicare Advantage overpayments are projected to be $76 billion — or 14% more — above what spending would be in traditional Medicare for the same beneficiaries this year. That finding was politically inconvenient for the industry, so the industry set about undermining it.
The Wall Street Journal published an op-ed calling MedPAC’s methodology into question, with the editorial board going so far as to call for MedPAC to be defunded. Industry-backed lobbying groups like the Better Medicare Alliance and the Healthcare Leadership Council – an outfit formed by Humana founder David Jones and other top industry executives in the late 1980s to shape federal policy – amplified the editorial and supported legislation that would dictate how MedPAC’s staff can conduct research.
Last Friday, Chicago Fed President Austan Goolsbee noted that rising unemployment on top of an oil price shock creates “exactly the kind of stagflationary environment that’s as uncomfortable as any that faces a central bank,” per the Wall Street Journal.
Flashback:
Analysts and media started tossing out the “s” word when inflation revved up back in 2021.
The term “stagflation” really took off the next year, when Russia invaded Ukraine, spiking energy prices. Everyone then predicted a recession that never materialized.
State of play:
Today is different for two reasons. First, the job market is more sluggish than it was a few years ago.
Second, the oil shock from the Iran war is potentially magnitudes larger than from the Russian war, taking 20% of global supply oil off the board.
“Disruption to the Strait of Hormuz creates a far larger potential supply shock that extends beyond oil,” Skylar Montgomery Koning, a macro strategist with Bloomberg, wrote in a note.
“Shipping flows more broadly are being disrupted. That is pushing up energy and food costs, lifting inflation and squeezing growth.”
“This stagflationary mix is particularly toxic for markets, as it increases the risk that bonds and equities sell off together.”
Reality check:
It’s not the 1970s. Economists believe the Iran war will slow economic growth and cause an increase in inflation, but not to the extremes seen back then.
“If you want the word ‘stagflation’ with a very little ‘s,’ you could,” says David Kelly, chief global strategist at JPMorgan Asset Management.
He recently revised his economic growth projections slightly downward this year due to the war. And he is projecting slightly higher inflation.
The difference between now and the 1970s is, back then, higher prices led to wage increases, which led to more inflation in a wage-price spiral that got out of hand, he says. Workers just don’t have the power for that today.
“This is probably just going to slow the economy down, rather than trigger some long wave of inflation,” says Michael Madowitz, principal economist at the progressive Roosevelt Institute.
The bottom line:
This is not your father’s economic shock. Yesteryear’s bell bottoms would look a bit weird if you trotted them out today.
HENRY KOTULA 