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McKinsey to pay $573M to settle claims over opioid crisis role: source

reuters.com

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Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#411

Post by TT3351 »

maybelsyrup wrote: post #280

One of my first jobs out of college was at small management consulting firm founded by an formerly very high level McKinsey guy. In a bigger firm, I wouldn't have had much contact with this person, but since we were tiny, he would often be out in the field with the junior people. One week I found myself with him in some faraway city. We were a bit lost (this was before smartphones) and late for our next appointment.…

I have worked for a startup operated by a McKinsey alum; he was totally incompetent, throwing buzzwords around constantly without understanding what they meant. I have come to realize his entire strategy was to purchase the company, dress it up in new clothes (without understanding tailoring or fabric) and sell it to another rube.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#412

Post by cycomanic »

throwawayboise wrote: post #381
lostcolony wrote: post #370

Earlier quoted context omitted.

You don't have to. How many people have you met who were happy doing nothing, living with nothing, AND who made good employees doing anything at all? I've met exactly zero. The ambitious won't want to stay there; the unambitious may "unfairly" get their basic needs met, but they're hardly living the high life, and the lost -useful- labor to society is negligible. Almost certainly more than offset by the ambitious who…

What do you do about unambitious people who live beyond their UBI means and end up being unable to pay the rent?

It's funny how these sort of questions are always being used to counter a safety net for the poor, but at the same time nobody does anything about rampant tax evasion and avoidance, which is much much more money.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#413

Post by lostcolony »

bumby wrote: post #394
arcticbull wrote: post #376

Earlier quoted context omitted.

This is in line with the results of Canada's early UBI experiments; substantially nobody left the workforce except to pursue liberal arts or stay-at-home parenting, both of which have intrinsic value. People are motivated by a combination of intrinsic and extrinsic factors, including their social group at work, finding meaning in their lives through their work, and so on. UBI and unemployment isn't provide enough for…

I think the major fault with these studies is there participants know the benefits will end. I think this biases them towards continued working because they view it as a short term windfall that won’t sustain them rather than a long term solution. It would be incredibly hard to design an experiment to control for this. Conversely, I think the hard part about implementing UBI is that it would be incredibly hard to rol…

The question I always wonder, when people bring this up, is if they've applied it to themselves.

If they had a basic UBI of, say, $20k, would they quit their job, and not look for work, not work on personal projects, not look to go back to school, nothing, just do what they are assuming others will do, sit around, watch TV, that sort of thing? Rather than keep striving, keep working, and have both an extra $20k being paid to them currently, and that safety net in place in case they lose their job?

Because I can't imagine doing that. I -like- having a higher quality of life. I desire to do things, to affect things. In fact, the most frustrating jobs I've had were the ones that felt like they handcuffed me from leaving due to the salary (not to mention things like equity cliffs and paying back signon bonus), but deprived me of any real empowerment or responsibility to affect change. If this logic applied to me, I should be thrilled; I barely have to do anything, am barely expected to do anything, and am paid through the nose. But I end up hating it and wanting out.

Even something like working McDonald's; would the additional pay of working there on top of UBI be worth it? If not, what would have to change? Better working conditions? More pay? I'd be interested to find out; why -don't- people find service industry jobs desirable? Why would someone choose to be unemployed, if their disposable income is higher working there? Are they just lazy, as America likes to paint it, or are there institutional problems that could be addressed, but remain unaddressed due to the inability for people to just quit and walk away?

We actually have some anecdotal data to this; people who inherit money sufficient they could live the rest of their lives doing nothing.

If it's multiple millions, yeah, people do decide not to work, "trust fund babies" and the like.

But plenty of people get a few hundred thousand and a house. That's enough that, if invested, they could pay property taxes and live a basic life without working. They could sell the house and move out of the country, and live even cheaper. How many do it in lieu of working? Very few. Why? Because they desire something more.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#414

Post by glaucon »

bcrosby95 wrote: post #400
leafmeal wrote: post #348

Earlier quoted context omitted.

What do you think an appropriate penalty is? When I first read this headline I was worried the fine would be just a slap on the wrist. I was glad to see it was more substantial. Personally, I think a fine like this is just if it causes consulting firms to think about the consequences of their actions and do the right thing in the future. Making firms responsible for damages they cause would be best. Making it it clea…

For basic fraud/bad behavior, off the top of my head, at least 5-6x what they made from it might be good. Anything involving direct, long term physical harm (such as death) needs a secondary penalty on top of this unrelated to profits made. You have to account for not all of these schemes being uncovered. Then you have to add an actual penalty on top of it.

Generally, for just plain old fraud or similar, this gets close to it for me. In this particular case however, where the wrong doing resulted in many deaths I think some other approach is appropriate.

I would really like to see more argument over why jail time is not an appropriate response for senior leaders within organisations that currently suffer nothing more than a fine. Where an organisation has shareholders if the fine is really big then the persons perceived as responsible will, presumably/hopefully, see their career prospects suffer but really to provide an incentive where the benefits can be supremely high I think seeing a few of your peers spending time in jug would help. I appreciate the problem is knowing who to jail and I appreciate that's a hard problem and I don't have a ready answer for it.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#415

Post by cycomanic »

majani wrote: post #351
neurotech1 wrote: post #292

Let's not forget, these are the same consultants that did work for Enron, work leading up to the 2008 financial crisis.[0] McKinsey is also advising various government agencies on optimizing their Covid-19 response[1], generating revenue of $100m and counting. [0] https://en.wikipedia.org/wiki/McKinsey_%26_Company#Controver... [1] https://www.propublica.org/article/how-mckinsey-is-making-10...

This type of scenario is probably the primary reason for the existence of management consulting firms: to have someone to point the finger to when risky decisions go tits up.

That and to push through unpopular decisions: "look we don't want to fire 30% of our workforce, but the consultants told us we need to to maintain our profit margin"

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#416

Post by strbean »

trhway wrote: post #291
ihaveajob wrote: post #267

I know someone who worked for McKinsey for a few years, and some of the projects he described were straight up slimy. The one I recall right now was helping a big payday lender (read: large scale loan shark) figure out how to get their money back from people who were behind on their payments. The problem was that they can only attempt to withdraw so many times from someone's bank before they're banned, so the agreed…

>so the agreed solution was to estimate the best time of the month when the client had received their paycheck, but before they had used it to pay rent and other expenses. The Purdue OxyContin's 12 hours higher dose and thus higher addictiveness "solution" instead of the 8 hour based lower dose cycle similarly bears all the hallmarks of being produced by MBA consultants.

Along with the whole different release times thing.

People obviously have different metabolisms, so the duration of effect was different for different people. When these people told their doctors that their dose didn't last a full 8 hours, and they were experiencing pain after, say, 6 hours... their doctors were advised by Purdue to simply up their dosage, rather than give them a different dosing schedule. Pretty direct approach to creating addicts.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#417

Post by carapace »

asjldkfin wrote: post #216
carapace wrote: post #199

Earlier quoted context omitted.

Programmers who build garbage are part of the problem, no?

Not if they build garbage well, the quality of the code and the quality of the product are independent.

But isn't building garbage a problem? What's the point of automatic garbage?

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#418

Post by bumby »

lostcolony wrote: post #413
bumby wrote: post #394

Earlier quoted context omitted.

I think the major fault with these studies is there participants know the benefits will end. I think this biases them towards continued working because they view it as a short term windfall that won’t sustain them rather than a long term solution. It would be incredibly hard to design an experiment to control for this. Conversely, I think the hard part about implementing UBI is that it would be incredibly hard to rol…

The question I always wonder, when people bring this up, is if they've applied it to themselves. If they had a basic UBI of, say, $20k, would they quit their job, and not look for work, not work on personal projects, not look to go back to school, nothing, just do what they are assuming others will do, sit around, watch TV, that sort of thing? Rather than keep striving, keep working, and have both an extra $20k being…

Anecdotally I’ve seen both sides. I’ve seen people get social security or disability benefits and coast for the rest of their lives without working even though they have the ability to do so without affecting their benefits. I assume they value sleeping in and not having to answer to anyone. Their idea of a good time is spending hours hiking or watching tv or various other things that have negligible cost.

I’ve also known those who get said benefits and either use it as a leg-up to get ahead or just donate it while they keep working. Honestly, I’ve seen more in the former category than the latter.

I suspect it cuts down along the industriousness subset of the Big Five personality traits. Those who get intrinsic satisfaction doing/building are probably likely to be in the latter group. I bet HN skews towards this which is why so many find it difficult to comprehend why somebody would want to just loaf around with their life. To your very thoughtful questions about why someone wouldn’t want to continue working, my guess is the roles they qualify for aren’t intrinsically satisfying to them because it’s a poor mating of their personality and the jobs society has deemed necessary or they don’t pay enough to make the juice worth the squeeze

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#419

Post by mlac »

malandrew wrote: post #367
arcticbull wrote: post #343

Earlier quoted context omitted.

The reality is that this is a very difficult situation all around. 1) Lenders probably shouldn't be lending money to people they know cannot repay the debts. This is also why APRs are so high - most people simply don't. 2) People who know they can't repay the debts shouldn't be borrowing in the first place. This is also why lenders have to go to such extremes to collect their debts. This is a function of being poor i…

How do you design an unemployment/UBI system that provides an incentive not to use it unless necessary and not to stay on it any longer than is necessary?

My concern is that lenders will start loaning against it at ridiculously high rates on UBI income streams - "Get 100K today for signing away your UBI payments!" or "just pay us the monthly amount of your UBI payment!".

After thinking about it a while, I realized the law would need to protect the UBI payments from being accessible in bankruptcy. That would significantly limit lenders willing to lend on that money. Those who did would be charging very high-interest rates on it and probably limit the total amount backed by it, so someone can't borrow 200k and then declare bankruptcy but have it be protected.

Even writing this out now, I'm not sure that this would work because I'm not sure how you prioritize lenders for someone's assets who declares bankruptcy.

I also see upward pressure on housing prices - right now, few landlords know what the market can take for pricing. It would be easy to bump everyone's rent by a few hundred dollars when UBI kicks in because you know everyone can afford it.

Technology and the market structure are so efficient at extracting value from things that it's hard to design any policy that will effectively achieve the desired outcome of providing food, clothing, and shelter for all citizens without some wonky unintended consequences.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#420

Post by bumby »

arcticbull wrote: post #402
bumby wrote: post #394

Earlier quoted context omitted.

I think the major fault with these studies is there participants know the benefits will end. I think this biases them towards continued working because they view it as a short term windfall that won’t sustain them rather than a long term solution. It would be incredibly hard to design an experiment to control for this. Conversely, I think the hard part about implementing UBI is that it would be incredibly hard to rol…

Indeed, I think the challenge is around committing to a 50 year study that they won't cancel later in a discretionary way. > Conversely, I think the hard part about implementing UBI is that it would be incredibly hard to roll back once people become accustomed to it So we are left with something people like and don't want to give up, and that's bad because... :)

>So we are left with something people like and don't want to give up, and that's bad because... :)

Sorry, I should have taken the time to elaborate.

There’s certainly a conceivable scenario when the situation is either unsustainable or not providing a net benefit.

For the first case, consider a petrostate whose population is heavily subsidized by its oil sales. If oil price drops, whether by lack of demand or over supply, they may not have the funds to continue these benefits without debt, regardless if the populace “likes” them.

In the second scenario, it’s possible that it creates unintended consequences (like spikes in drug use, drop in life expectancy, reduced productivity) that become a larger social ill than what it was trying to prevent. Despite society being worse off, it becomes hard to scale it back because of the psychological endowment effect.

I’m not saying its likely, just as a counter point that just because people like a benefit it means it should continue. I think it’s important to do a “pre-mortem“ on these kinds of policies to make sure we have the guardrails in place before implementing them.

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