"There have been reports just over the last couple of days of insurance companies making record profits, right now," Obama said during a prime-time news conference. "At a time when everybody's getting hammered, they're making record profits, and premiums are going up. What's the constraint on that? ... Well, part of the way is to make sure that there's some competition out there."
I'm very pleased that our Chair of our Democratic Congressional Campaign Committee and member of the leadership will be talking too about the immoral profits being made by the insurance industry and how those profits have increased in the Bush years. We all believe in the profit motive; we all want to reward success. But having that success come at the expense of America's working families "” have that success come by withholding care, when a person becomes ill, is just not right and we're going to take this issue in a new direction.
And pundits saying even crazier stuff, including Kevin Drum (who is actually one of the saner members of the left) writing:
It means the health insurance industry is scared that we might actually do something in 2009 and they want to be seen as something other than completely obstructionist. That means only one thing: they've shown fear, and now it's time to bore in for the kill and gut them like trouts. Let's get to it.
Rick Perry links to several posts debunking this claim, and shows a profit margin consistent with what I have found in my research -- about 3.3% of revenues, which my posts (linked above) showed has fallen over the last several years. This profitability level ranks 86th(!) on the list of American industries, behind such rapacious industries as auto parts wholesalers and confectioners (see table in his post). Look out everyone, if this industry is too profitable for this administration, then just about every industry in the country is too profitable. Heck, this margin is even worse than mine, and I operate in an industry universally described as having "thin margins."
What do you call a man who thinks a 3.3% profit margin is too high? How about "Marxist."
Update: My guess is that there is some health insurer who due to a merger grew larger and therefore made a higher profit in absolute dollar terms, so my guess is that Obama is not flat out lying. But he is freaking close, given that he credits such profits to fee increases and denying services rather than business growth. Profitability should be judged on margins, not total dollars (even better, it really should be judged on return on equity or return on assets employed, but that is rocket science to the economic monkeys wielding bone tools we have in the media).