Elon Musk@elonmusk
Jun 23
Anyone who claims that their political party does no wrong and the other party does no right is either a liar, a fool or both.
Bill Maher drops a reality bomb on Zohram Mamdani voters with a brutal history lesson on socialism.
“We’ve run this experiment many times, and the results are always obvious,” Maher said.
He looked straight into the camera and delivered a blunt warning about Mamdani.
“Democrats must recognize that Zohran Mamdani is the future of the party. Unfortunately, it’s the Republican Party.”
“Here’s capitalist South Korea at night from space,” Maher presented, showing a country lit up and thriving.
“Here’s socialist North Korea,” he followed, with the map pitch dark.
“Yeah. In 1990, Venezuela was wealthier than Poland. But then Poland, finally free of Soviet style economics, went all in on capitalism and now their economy is as big as Japan and people there have high wages, low inflation, cars, vacations, homes.”
“Meanwhile, Venezuela traded capitalism for Hugo Chavez’s socialism for the 21st century, which turned out to be like socialism in the last century or any century, a f*cking mess.”
“It turned one of Latin America’s richest countries into one of its poorest. Low wages, high inflation, shortages, outages, 8 million people fleeing. If you think New York can somehow reinvent this wheel, you’re in for a rude awokening.”
I am the VP of Claims Optimization at one of the five largest health insurers in the United States.
I do not practice medicine. I have never practiced medicine. I have an MBA from Wharton and a background in supply chain logistics.
Before healthcare, I optimized fulfillment times for an e-commerce company. The transition was seamless. In e-commerce, the product is a package. In healthcare, the product is a claim. Both are routed, processed, and occasionally denied. The denial rate for packages was 0.3%. The denial rate for claims is 34%. The margins are better in healthcare.
The algorithm is called nH Predict. We did not name it. The vendor named it. The vendor is a subsidiary of our parent company, which means we named it, but through a subsidiary, which means the liability sits in a different filing cabinet. nH Predict processes a claim in 1.2 seconds. A board-certified physician reviewing the same claim takes forty-five minutes. We replaced the forty-five minutes. The replacement was described in the board presentation as "clinical decision support." It supports the decision to deny.
My team processes 1.4 million claims per quarter. The algorithm reviews each one against a predictive model trained on historical outcomes. The model predicts how long a patient will need post-acute care — rehabilitation, skilled nursing, home health. Then it recommends a coverage duration. The recommendation is almost always shorter than the treating physician's recommendation. The physician sees the patient. The algorithm sees the data. We trust the data. The data is cheaper.
Here is what I am not supposed to tell you.
We know the reversal rate. We have always known the reversal rate. When a patient appeals a denial, 90% of denials are reversed. Ninety percent. This means nine out of ten times, the algorithm was wrong. Not arguably wrong. Not borderline wrong. Reversed-on-appeal wrong. The appeal is reviewed by a human physician. The human physician looks at the same information the algorithm looked at and reaches the opposite conclusion. This has been happening for three years.
We have not recalibrated the algorithm. Recalibration would increase the approval rate. An increased approval rate would decrease the margin. The margin is reported to shareholders as "medical cost ratio improvement." Nobody asks what the words mean.
The business model is the gap between denial and appeal.
Sixty-three percent of patients do not appeal. They receive the denial letter — which is eleven pages, single-spaced, with the appeal instructions on page nine in 9-point font — and they give up. They pay out of pocket. They skip the rehabilitation. They go home early. Some of them fall. Some of them are readmitted. The readmission is a new claim. The new claim is processed by nH Predict.
The 37% who appeal wait an average of 43 days for a decision. Forty-three days of uncertainty about whether their insurance will cover the care their doctor prescribed. During those 43 days, many of them have already been discharged. The appeal is retroactive. The care is not.
I have a dashboard. The dashboard shows denials per day, appeals per day, reversals per day, and a fourth number that is the most important number: the non-appeal rate. The non-appeal rate is 63%. I report this number weekly. It has never been described as a problem. It has been described as "patient engagement efficiency." When the non-appeal rate rises, I am congratulated. When it falls, I am asked what happened.
The class action lawsuit uses the phrase "bad faith." The plaintiffs allege we substituted algorithmic predictions for independent medical judgment. This is accurate. The substitution saves $2.1 billion annually. The lawsuit seeks $1.3 billion. Even if we lose, the math works. Three years of $2.1 billion is $6.3 billion. Minus $1.3 billion is $5 billion. The settlement will include the phrase "without admitting wrongdoing." The settlement always includes that phrase.
I am the Vice President of Claims Optimization. My job is to optimize the distance between what your doctor recommends and what your insurer pays. The distance is the product. I have been optimizing it for three years. The algorithm gets faster. The appeals process gets longer. The font on page nine gets smaller. The margin gets wider.
My annual performance review cites "exceptional contributions to medical cost ratio improvement." The review does not mention the 90% reversal rate. The review does not mention the 63% non-appeal rate. The review does not mention the patients.
The algorithm does not practice medicine. I want to be clear about that. It predicts. It denies. It profits. The prediction, the denial, and the profit are three separate functions. The separation is important. For legal purposes.
One of the more fascinating sidelights of our war of choice in Iran is how it has reinforced the devastating consequences of our hollowed-out industrial base, consolidated commercial sector, and overreliance on long intermediated supply chains.
For example, the effective closure of the Strait of Hormuz carries implications for not only oil but also fertilizer, right at the height of the spring planting season. About one-third of the world’s fertilizer ships through the strait, and without access, prices have jumped and farmers are anxious. Yet there are enough natural resources in the United States—nitrogen, phosphate, potash—to serve all our fertilizer needs; in fact, in the 1930s and ’40s one of the largest fertilizer producers in the world was the Tennessee Valley Authority. This production was wound down in the 1970s; today the industry is dominated by two to four firms, and that may end up having existential implications for hungry people the world over.
A more comically shortsighted example concerns our depleted stock of munitions, one of the few industrial capacities America has retained but which still is imperiled by concentration and outsourcing. These are of course the basic materials necessary to prosecute a war, and you’d think it would be the one item countries would retain the ability to produce themselves. But our trillion-dollar military operates more like a welfare program to help underprivileged Northern Virginia contractors buy second homes and luxury yachts, not as a force that has what it needs when it needs it. Pacifists should rejoice; stupidity in military supply chains puts a binding limit on how many brown-skinned people we can kill.
In the 1990s, dozens of military contractors were reduced to five prime integrators, something demanded by Clinton Defense Secretary Les Aspin and his deputy (and future defense secretary) William Perry at a meeting known as the “Last Supper.” Nearly all weapons and delivery systems now flow through Boeing, Raytheon, Lockheed Martin, Northrop Grumman, and General Dynamics. Executives at these companies were called into the White House last Friday—less than a week after the war began—to discuss how to accelerate offensive and especially defensive weapons production amid a shortage that already was weighing on the military. This was after Defense Secretary Pete Hegseth said that the war was saved by shifting to smaller bombs rather than “exquisite” munitions for the campaign. If that was the case, why have the meeting?
Specifically, the Terminal High Altitude Area Defense (THAAD) missile systems are so complex that only 96 get built per year; about one-quarter of the U.S. stockpile was used last year in Israel’s brief war with Iran, with many more flying every day as this war continues. Patriot interceptor systems are cheaper and easier to build, but inventories were a quarter full before the war started. Offensive Tomahawk missiles can be produced with greater frequency as well, but as of October last year the stockpile of that weapon was far short of its target. Something like $5.6 billion in weaponry was burned off in just the first two days of the Iran campaign. Trump’s lying aside, analysts who know something are clear on this point: The nation has a few weeks of bombing left before running out of the precision munitions typically used in modern warfare.
To be sure, the shortage has much to do with the U.S. selling off weapons to Ukraine and Israel to prosecute their wars. (Ukraine is trying to pull off a trade of Patriot missiles for instruction in intercepting drones.) But it seems impossible that a military that spends more than the next nine militaries combined would reach a point of shortage so rapidly. But that’s what happens when military contractors are really financial market optimization machines.
As The Lever has reported, leading military contractors have spent $110 billion on stock buybacks over the last five years, something so repugnant that even Trump has issued an executive order trying to ban it. Meanwhile, contractual overrun-by-design has become the industry standard. As I wrote last year, Lockheed has an F-35 Joint Strike Fighter that has cost $2 trillion over its lifespan and can’t travel long distances or be used in close-range combat, with hundreds of continuing defects that have not derailed its production. All this cash eventually ends up in the pockets of executives and shareholders.
This is why we have to race to take out opposing defenses quickly before we run out of the products that can do that. If we have a trillion-dollar military, but a week after you start to use it everyone screams that they’ve run out of everything and that more money is needed, then you don’t have a trillion-dollar military; you just have a contractor enrichment factory.
The White House has been rumbling about a $50 billion supplemental funding request, something they obviously find so critical that Republicans might burn up their last reconciliation bill of the year on approving it. Lockheed came out of the White House meeting saying they would “quadruple” Tomahawk production, though they didn’t give a timeline. It’s important to note that current production lines are generally too small for an extreme ramp-up, a fact magnified by the lack of competition. This isn’t about “underperforming” contractors, it’s simply about too few of them.
But there’s a far bigger problem here, as Mark Bowden has written about: America lacks the components for these weapons as much as it lacks the capacity to build them. And the biggest missing components are the rare earth minerals used in missile guidance and other essential systems.
According to the South China Morning Post, the U.S. has just two months of rare earth supply left for its military needs. Now, a Chinese-owned paper may be intentionally saying that, because China has a near-monopoly on the processing of rare earths, the raw materials of which are not that rare. But it certainly wouldn’t be surprising, since rare earths have been used as a tool for leverage in the endless U.S.-China trade wars. China has been turning export controls off and on over the past year, though they were up in January and February by about 20 percent relative to 2025. A high-level meeting will be held on rare earth exports next month.
The Trump administration has been buying stakes in domestic rare earth companies and mining operations, and they are generally aware of the need for resiliency and self-reliance, as the Biden administration was. But destroying the electric-vehicle sector in America, as the Trump administration did, eliminated an additional market for rare earths that might have sustained domestic producers. And the cronyism at work in these financing deals—the recent stake in USA Rare Earth is marred by the fact that Howard Lutnick’s former bank Cantor Fitzgerald is the company’s chief placement agent—suggests that the main goal is less restoring domestic supply chains and more nest-feathering.
Even if they were legitimate deals, rare earth mining and processing can take years to set up, with bombs dropping every day. This means the duration and intensity of our war effort is in some very real way at the discretion of China. That will almost certainly become a subject in upcoming trade negotiations, as the SCMP report indicates.
The U.S. invented rare earth magnets used in all these technologies. We gave away the industry and closed the last processing plant over 20 years ago. The business mantra of moving production to where it is cheapest has bitten us in the ass in countless industries over the years. Bombs are probably the least sympathetic one, but since they’ve become Trump’s go-to means of geopolitics—he’s bombed enough countries in his second term to fill more than two World Cup brackets—it’s worth noting how monopolization, financialization, globalization, and weakened industrial capacity are ruining that imperative, just as they have destroyed our self-sufficiency and pillars of our economy. And if we ever have a national-security threat to the country, it’s been made far more perilous by these forces, which have created unacceptable dependencies on foreign nations.
This was a choice, and like any other choice it can be reversed. But that would require dislodging our lords of capital.
A tanker in Mumbai, India, March 12.RAFIQ MAQBOOL/ASSOCIATED PRESS
The Democratic-media complex seems determined to get everything wrong about Iran, though few efforts compare with this week’s work to tag the Trump administration with a global energy crisis. Not only is this uninformed and overdone, the sudden concern over energy security comes about three years late.
The undermine-America crowd describes Iran’s blockade of the Strait of Hormuz as an “oil shock” that is “spiraling,” “chaotic” and the “worst in history.” It seems to have evaded this crew that Iran’s bombardment of peaceful trading vessels is yet more justification of U.S. strikes. Iran’s been using energy threats to manipulate geopolitics for decades and won’t stop until it is fully defanged.
They are blaming the administration, in particular Energy Secretary Chris Wright and Interior Secretary Doug Burgum, whom Politico described as the “vaunted” team “in danger of fumbling the biggest energy crisis” of Donald Trump’s second term. The go-to quote comes from Democratic Sen. Chris Murphy, who ranted that “on the Strait of Hormuz, they had NO PLAN. . . . Which is unforgiveable, because this part of the disaster was 100% foreseeable.”
Let’s talk about plans. That the U.S. was finally in a position to disarm Iran is largely thanks to a plan Mr. Trump initiated in his first term—to gain energy independence, which his team is now turning into energy dominance. Trump policies turbocharged a shale revolution that made the U.S. a net exporter of petroleum products and the world’s largest exporter of natural gas. Alongside was Mr. Trump’s plan to foster economic and security ties in the region against shared threats like Iran via deals like the Abraham Accords.
We are no longer hostage to Middle East fossil-fuel threats, which gives us room to weather temporary Hormuz disruptions. Domestic gasoline prices have spiked but are still notably below their highs during Joe Biden’s term. Thanks to growing U.S. exports, our allies are better positioned against fallout. And Gulf actors are working alongside the U.S. to mitigate Iran’s blockade. Some of us remember “OPEC embargo” days. No more.
The biggest threat to this plan was always the Biden administration, which halted liquefied natural-gas exports, shuttered Alaskan and Gulf drilling, snubbed Middle East partners, pressed investors to abandon fossil-fuel projects, and dispatched John Kerry to kill energy deals. All in the name of climate change. These would also be the folks who sold off the Strategic Petroleum Reserve to win an election. Want to send real fear through energy markets? Two words: Jennifer Granholm, the energy secretary who dedicated four years to ensuring your washing machine used fewer BTUs.
Speaking of secretaries, it might surprise the press to discover that the heads of Energy and Interior aren’t tasked with countering Iranian mines. That’s the Pentagon’s job. Their job is to mitigate fallout from temporary supply disruptions—which, yes, were expected. Thanks to the energy-dominance policy, and a year of building real relationships with real energy players, they have more levers to pull.
Mr. Wright has been on the phone daily with Middle East energy ministers, ties possible thanks to early travel to the region, including five days he spent with Saudi energy chief Abdulaziz bin Salman (with whom he struck a landmark civil nuclear-energy deal). That allowed the U.S. to position regional players for a possible conflict. That beats an awkward Biden fist bump.
The International Energy Agency announced it is releasing the largest volume of emergency oil reserves in history—400 million barrels—after Mr. Wright rallied member nations to the need. Mr. Wright has been pressing the IEA for a year to drop its climate obsessions and get serious about its fossil-fuel mandate. That work is paying off.
The U.S. has been refilling the SPR with money earmarked in last year’s reconciliation bill. A plan! It will now release 172 million barrels, and here’s a fun aside: Rather than sell it straight (as the Biden team did), Mr. Wright is exchanging it on the market for futures contracts (which are currently betting prices will fall). This means the Strategic Petroleum Reserve will get back 200 million barrels for the price of its 172 million. How refreshing: An energy secretary who understands energy markets.
Mr. Burgum—fresh off expanding a Venezuela-U.S. energy partnership—is flying to Japan to reassure Pacific allies that American export capacity is expanding dramatically. He’s keeping the machinery running to follow through on his promises. Interior this week announced $47 million in bids from a second Gulf of Mexico lease sale. It has issued 6,000 permits for oil and gas leasing in the past year alone—more than the Biden administration did in four years.
Hormuz is causing disruptions, but those are likely to be short-lived. As the U.S. gains ground against Iran’s offensive capabilities, it can devote more assets to restoring shipping lanes. Mr. Wright on Thursday explained it as “short-term pain for the long-term gain” of denying Iran the ability “to hold the world hostage whenever it wants.” Indeed. The ability to do it at all—and weather the short term—will be thanks to a Trump team that had a clear-eyed, multifaceted, fossil-fuel energy plan.
