Sound and Fury - Sound, PBMs, Mars, and Archegos
Sound
In 1909, zoologist Jakob von Uexküll coined the term Umwelt to describe the sensory bubble surrounding all animals, humans included. It describes how we experience the world, each with a unique set of senses. As Ed Yong writes, humans are singular in that we can not only study and understand the Umwelten of other species, but we can - intentionally or not - create wholesale change in the lived environment, impacting how other animals experience it.
One study of American national parks found that background noise was audible in more than a third of places intended to be pristine and remote. These noises can change birdsongs, or alter migratory patterns. Underwater, the relentless din of the cargo ships that make up our global supply chain have turned the seas into noisy torture chambers:
As ships pass in the night, humpback whales stop singing, orcas stop foraging, and right whales become stressed. Crabs stop feeding, cuttlefish change colors, damselfish are more easily caught.
What would it feel like if someone ramped up the ambient noise around us by twenty or thirty decibels? It turns out, such an experiment is going on across the country, and you’re never going to guess who’s responsible:
…they all shared a singular grievance: a dull aural hum had crept into their lives, which growled or roared depending on the time of day, rattling their windows and rendering them unable to sleep. The hum, local law enforcement had learned, was emanating from a Bitcoin mining facility that had recently moved into the area—and was exceeding legal noise ordinances on a daily basis.
Of course it’s Bitcoin. What else would it be? The residents of Granbury, Texas have been experiencing serious health issues since a Bitcoin ‘mining’ company installed thousands of loud servers on property adjacent to a nearby power plant.
Unlike traditional datacenters, which sit inside secure concrete buildings, the coiners went with a cheaper approach, slapping down 163 shipping containers with giant fans attached to keep their graphics cards cool:
In order to cool the machines, the site’s operators attached thousands of fans to the containers, which churned constantly, emitting a vicious buzz. As more machines were switched on, the noise sounded like a ceiling fan, then a leaf blower, then a jet engine. It consumed afternoon dog walks and revved through cloudless nights, vibrating the trailer homes of many of the low-income residents who live blocks from the facility.
What happens when someone installs a jet engine down the road? You might experience serious neurological issues - the piece is full of children experiencing seizures, young adults having heart attacks, hearing loss, and worse. These new Bitcoin facilities are running a twisted experiment - what if we subjected humans to constant loud noise and vibrations? Turns out, our bodies and minds quickly break down.
The local sheriff has been tracking the noise, to little effect:
[John] Shirley sticks his recorder out the window and the numbers on it flicker up and down as the roar washes over it. Eventually, the recorder caps out at 91 decibels, which the CDC estimates as roughly in between the output of a lawnmower and a chainsaw.
This level of noise, the CDC writes, can cause hearing damage after two hours of exposure. The Occupational Safety and Health Administration advises that employees can only work in 90-decibel settings for eight hours a day and are required to wear ear protection.
Noise levels across the street from the facility are louder than even the state of Texas allows, and its got the worst noise regulations in the country at 85 decibels. There is technically a federal noise mandate, but it was gutted under Reagan and no administration since has revived it.
Bitcoin companies are aware of the damage their farms are causing, and rather than shell out for enclosures or reconfigure how their servers operate, they’re lobbying for legal protections:
Similar medical complaints have been registered near facilities in Arkansas and North Dakota. And the Bitcoin mining industry is urgently trying to push bills through state legislatures, including in Indiana and Missouri, which would exempt Bitcoin mines from local zoning or noise ordinances. In May, Oklahoma governor Kevin Stitt signed a “Bitcoin Rights” bill to protect miners and prevent any future attempts to ban the industry.
Bitcoin Rights, huh. Though we aren’t hearing as much about crypto and blockchain these days because AI is the latest tech industry obsession, it’s worth remembering that as long as Bitcoin’s price stays propped up by mainstream finance, bloodless companies competing to create more of them will be a plague on cities and towns across the country, quite literally vibrating them to death.
PBMs
Pharmacy benefit managers, or PBMs, are a shadowy cabal of middlemen sitting in the ‘bowels’ of the health care system, according to the NYT, jacking up the price of our prescription drugs for profit:
The job of the P.B.M.s is to reduce drug costs. Instead, they frequently do the opposite. They steer patients toward pricier drugs, charge steep markups on what would otherwise be inexpensive medicines and extract billions of dollars in hidden fees, a New York Times investigation found.
This runs contrary to what the industry claims. According to the PBM lobbying arm (a real thing), they save the US healthcare system hundreds of billions of dollars. Which sounds good! But they do so in the most cynical way imaginable:
But those savings appear to be largely a mirage, a product of a system where prices have been artificially inflated so that major P.B.M.s and drug companies can boost their profits while taking credit for reducing prices.
What a business model. First, you take lifesaving drugs, hike the price, mark it back down to a still-profitable level, and pat yourself on the back.
In recent years health care giants CVS, Cigna, and UnitedHealth have consolidated three huge PBMs that now control prescriptions for two thirds of the country. They then use this leverage to run up prices for themselves, charge drug companies junk fees they keep for themselves, and run small and independent pharmacies out of business with lowball pricing.
Because most Americans get their health insurance through their work, PBMs can overcharge those systems with little public outrage:
In Oklahoma, for example, CVS’s P.B.M., Caremark, overcharged the health plan for state employees by more than $120,000 a year for one patient’s cancer drug, according to his insurance documents.
PBMs evolved from a network of prescription middlemen who made money by taking a cut of the savings they created, into predatory arms of existing healthcare giants focused only on share price:
[PBMs] were often credited with saving money for patients and employers, including in the early 2010s when they embraced a new wave of generic drugs.
[…]
The modern P.B.M. emerged in 2018. The giant health insurers Aetna and Cigna were trying to achieve the growth demanded by Wall Street. They sought to merge with the P.B.M.s, whose profits were soaring.
The way PBMs make money now is to negotiate ‘rebates’ on the price of a drug with the manufacturer. It’s why Ozempic ‘costs’ $16,000, but no health insurer is paying anywhere near that. PBMs were originally designed to pass most of the rebate savings through to the employer or health system buying the drugs, but in the new market PBMs take more of it as profit.
This means drug companies raise their prices to maintain margins, which means PBMs get more of that money, and anyone with a deductible health plan (or no insurance at all) is paying more at the pharmacy. All because the PBMs insist on profits for themselves, to keep their parent companies’ share prices afloat.
Not content with inflating drug prices, PBMs pressure insurers to design plans around more expensive brand name drugs rather than affordable generics:
For example, Express Scripts typically urges employers to cover brand-name versions of several hepatitis C drugs and not the cheaper generic versions.
And, not content to simply skim fees off the drug rebates, PBMs created group purchasing operations (GPOs), subsidiaries they use to charge ‘negotiation’ fees to drug companies for, uh, negotiating the deals with their PBMs. These fees aren’t part of the rebates, so the owners of the PBMs and GPOs can double dip their way to billions:
This is hopefully the only time you will read a defense of drug manufacturers in these pages, but it is not difficult to see why drugs in this country are so expensive, when the companies running the pharmacies and health systems and insurance companies are also charging the companies making the drugs $8 billion a year to distribute them.
This should be an absolute lay-up for the government’s antitrust divisions, and the FTC did just issue a report on PBMs, though it hasn’t yet brought a lawsuit. PBMs are crushing competition, driving up prices for everyone across the entire market.
Beneath this mountain of bullshit are the patients, the people who may show up at a CVS counter to fill a prescription only to be told it’s hundreds or thousands out of pocket, or not covered at all.
I’ve gone through this myself - one pill I take so my hair doesn’t fall out is not covered by any US insurer, and for years I played coupon roulette at my local pharmacy to see whether I’d pay $70 or $20 dollars for a month’s worth. I only recently was able to take advantage of Mark Cuban’s new pharmacy, where the pills cost $13 for a 90-day supply.
While my issue is not life-threatening, there are an endless number of stories of people who ration insulin or other critical drugs, because PBMs and insurers and everyone else involved are playing three-card monte with their lives. For years we’ve blamed the greedy drug companies, but it turns out there were a few more villains yet to emerge from the clown car.
Mars
You know you’re in for it when you come across a lede like this:
SpaceX employees are working on plans for a Martian city, including dome habitats, spacesuits and researching whether humans can procreate off Earth. Mr. Musk has volunteered his sperm.
I mean, maybe it’s a good thing SpaceX employees are spending their time building fictional Martian cities in CAD or whatever, rather than cooking up new ways to demolish habitats and native wildlife.
And sure, Musk does not hide the fact that his desire to spread civilization into the stars is more his gross obsession with impregnating as many women as possible than any kind of altruism, but unfortunately for us he’s rich and owns a space company, so some people take it seriously.
Another byproduct of Musk being so rich is that the Times will dedicate endless pages to the credible discussion of space travel and Mars colonization with shit like this:
In his 2013 interview for the science video, he said he hoped to create his own species on Mars, an idea that he has repeated over the years to SpaceX employees and others close to the company.
“I think it’s quite likely that we’d want to bioengineer new organisms that are better suited to living on Mars,” he said in the interview. “Humanity’s kind of done that over time, by sort of selective breeding.”
Ok, dude! He also wants to set off nuclear explosions to heat Mars with ‘artificial suns’ and use solar panels to power giant habitat domes. He says this will get done within twenty years.
One thing left out of this ridiculous fantasy is the unpleasant fact that space travel seems to shred our kidneys. Barry Petchesky sums it up well:
But what if certain challenges are not hurdles but roadblocks, and not technological but biological? If the problem is not what we can build, but what we are? It would be a huge blow to future hopes of a cosmic diaspora if the obstructions were not about time and distance, but about the fundamental weaknesses of the human body.
The radiation in space, combined with all the other effects of microgravity on the body, are problems we haven’t come close to tackling. Putting thick shielding on a spacecraft is not a ten or twenty-year solvable problem, much less protecting humans if they did survive the flight to Mars with a suitcase full of extra kidneys.
Like most things billionaires become obsessed with - living forever, populating the universe - a colony on Mars is a convenient distraction from what Musk and his ilk are doing to this planet. It’s also in keeping with all of Musk’s big ideas - a flashy, sci-fi product designed without an iota of thought for the humans who have to use it.
Archegos
Back in 2021, we talked a bit about Archegos Capital Management and its founder, Bill Hwang. He’d used his private hedge fund to build up huge stakes in a bunch of big stocks, and then borrowed against those stakes to build even bigger stakes, which eventually all came crashing down and cost a bunch of banks billions of dollars.
He’s been on trial in New York for fraud, accused of both market manipulation and lying to lenders. While there are arguments to be made that Hwang was not actually manipulating markets by simply buying a shit ton of stocks he thought would go up, he definitely did lie and instruct his employees to lie to his lenders, assuring them he did not have gigantic, overleveraged stakes in a handful of companies. And the jury agreed that was fraud.
One argument used by prosecutors to let white collar criminals off the hook is that a jury won’t understand the nuances of finance or technology to reach a correct verdict. And yet, they seem to be doing a pretty good job!
We can hope that with more financial criminals being held accountable for their actions, and even beloved American brands being taken to task for monopolistic behavior, the powerful people strip-mining our economy for their own benefit may worry even a tiny bit that they could some day face consequences.
Short Cons
404 Media - “Generative AI could “distort collective understanding of socio-political reality or scientific consensus,” and in many cases is already doing that, according to a new research paper from Google.”
The Cut - “To steal a phrase from Taylor Swift, who’s both complained about NDAs and given them out, pop culture has entered its NDA era.”
NPR - “In the wake of a debilitating cyberattack against one of the nation’s largest health care systems, Marvin Ruckle, a nurse at an Ascension hospital in Wichita, Kansas, said he had a frightening experience: He nearly gave a baby “the wrong dose of narcotic” because of confusing paperwork.”
NYT - “On Monday, European Union regulators said Meta’s subscription, which costs up to 12.99 euros a month, amounted to a “pay or consent” scheme that required users to choose between paying a fee or handing over more personal data to Meta to use for targeted advertising.”
CNN - “The CFPB said it was imposing penalties on the bank for illegally charging customers for unnecessary auto insurance policies. It estimates the practice harmed more than 35,000 customers and resulted in vehicle repossession for more than 1,000 of them.”
Know someone thinking of going to Mars? Send them HERE!