Payola is Pervasive

Barry Ritholtz:


“This is not a pretty picture; what we see is that payola is pervasive,” Mr. Spitzer said, using a term from the radio scandals of the 1950’s in describing e-mail messages and corporate documents that his office obtained during a yearlong investigation. “It is omnipresent. It is driving the industry and it is wrong.”

The Attorney General’s findings alleges that the illegal payoffs for airplay were designed to manipulate record charts, generate consumer interest in records and increase sales:

“Instead of airing music based on the quality, artistic competition, aesthetic judgments or other judgments, radio stations are airing music because they are paid to do so in a way that hasn’t been disclosed to the public,” Spitzer said at a press briefing.

An alternative? I think we’ll see more of this.

Cheaper Health Insurance?

Wall Street Journal:

The idea behind the legislation, sponsored by GOP Representative John Shadegg of Arizona, is disarmingly simple: Allow Americans to buy health insurance from vendors in any one of the 50 states.

Right now Americans who aren’t lucky enough to get insurance from large employers or poor enough to qualify for Medicaid find themselves at the mercy of the legislators and insurance commissioners of the state in which they happen to live. This can be OK in states that exercise this regulatory function judiciously. But in others, the young and working poor find themselves effectively priced out of the market by special-interest regulations dressed up as consumer protections.