OxyContin - Corporate Scam

   The idea that OxyContin "rarely posed problems of addiction for patients" is so insane to me - by the year 2000 I was aware of people illicitly buying OxyContin as being addicted to it. And I am neither a doctor nor involved in any drug trade. My electrician was addicted to OxyContin which he started with as a prescription for an on the job injury.

Rising painkiller addiction shows damage from drugmakers’ role in shaping medical opinion

By Peter Whoriskey, Published: December 30, 2012

Portsmouth, Ohio — Over much of the past decade, the official word on OxyContin was that it rarely posed problems of addiction for patients.
The label on the drug, which was approved by the FDA, said the risks of addiction were “reported to be small.”
The New England Journal of Medicine, the nation’s premier medical publication, informed readers that studies indicated that such painkillers pose “a minimal risk of addiction.”
Another important journal study, which the manufacturer of OxyContin reprinted 10,000 times, indicated that in a trial of arthritis patients, only a handful showed withdrawal symptoms.
Those reassuring claims, which became part of a scientific consensus, have been quietly dropped or called into question in recent years, as many in the medical profession rediscovered the destructive power of opiates. But the damage arising from those misconceptions may have been vast.
The nation is confronting an ongoing epidemic of addiction to prescription painkillers — more widespread than cocaine or heroin — that has left nearly 2 million in its grip, according to federal statistics.
“It turns out that the doctors didn’t know what they were talking about,” said Barbara Howard, whose daughter Leslie, a home-care nurse, died of an overdose in 2009 in this small Appalachian town devastated by the epidemic. She had developed a habit after knee surgery. She left behind a 9-year-old son.
“Leslie trusted the doctors. We thought the doctors knew what was best. But they didn’t. We — and lots of the other victims — had no warning.”
Conflicts of interest
A closer look at the opioid painkiller binge — retail prescriptions have roughly tripled in the past 20 years — shows that the rising sales and addictions were catalyzed by a massive effort by pharmaceutical companies to shape medical opinion and practice.
Opioids are a class of powerful drugs, often used for pain, that includes morphine, heroin and brand names such as OxyContin, Vicodin and Percocet.
For years, doctors had been cautious about prescribing opioids to anyone except patients with cancer or in acute pain.
But drug manufacturers and some pain specialists helped create a body of scientific research assuaging the long-standing worries about opioids and pushed to expand the use of the drugs in people with chronic pain — bad backs, arthritis, sore knees.
Their studies reported minimal risks of addiction and dependence. These, in turn, were accepted by the FDA and the nation’s medical journals. State medical boards made their rules for prescribing opioids more liberal. Academic and industry articles dismissed the old fears as “opiophobia.”
These reports reached doctors through marketing efforts and told them that there were few risks in using opioids to treat chronic pain.
But according to a Washington Post examination of key scientific papers, a court document and FDA records, many of those claims were developed in studies supported by Purdue Pharma, the maker of OxyContin, or other drug manufacturers. In addition, the conclusions they reached were sometimes unsupported by the data, and when the FDA was struggling to come up with an opioid policy, it turned to a panel populated by doctors who had financial relationships with Purdue and other drugmakers.
●A review of 16 key clinical trials on the subject shows that five were funded by Purdue and an OxyContin distributor, two were co-authored by Purdue employees, and two were sponsored by other drug companies making different opioids. None of the 16studies showed clear warnings about the addiction dangers or the physical dependence generated by the drugs. The low rate of addiction reported in these studies is at odds with more recent findings indicating that diagnoses of addiction are common in opioid patients.
●Internal company documents indicate that one of the key published studies sponsored by Purdue — the one reprinted 10,000 times — omitted suspected cases of withdrawal symptoms. The published paper offered assurance that only two of more than 100 OxyContin patients had withdrawal symptoms; the internal documents showed that at least 11 exhibited possible signs of withdrawal, and some experts say it is likely that at the doses given, most of the patients would have experienced withdrawal.
●To refine its policy on opioids, the FDA convened a key meeting in 2002 and invited 10 outside experts for advice. Five of them reported having served as speakers or investigators for Purdue. Three others reported working as speakers for or as advisers and consultants to other pharmaceutical companies.
One of those FDA advisers, Russell Portenoy, who was then the chair of the Department of Pain Medicine and Palliative Care at the Beth Israel Medical Center in New York, has since expressed regret for his evangelism on behalf of opioids.
He was “trying to create a narrative so that the primary care audience would . . . feel more comfortable about opioids,” Portenoy said in a 2010 interview with Andrew Kolodny, the chief of a group seeking to rein in drug use, Physicians for Responsible Opioid Prescribing. “Because the primary goal was to destigmatize [opioids], we often left evidence behind. . . .
“To the extent that some of the adverse outcomes now are as bad as they have become in terms of endemic occurrences of addiction and unintentional overdose deaths, it’s quite scary to think about how the growth in that prescribing driven by people like me led in part to that occurring.”
Through a spokesman, Portenoy declined to comment for this report, but he has said that he continues to believe that many patients with chronic pain can benefit from opioids, though the estimates of how many patients may become addicted are larger than previously thought.
At the time of the 2002 FDA meeting, Portenoy reported being a speaker for Purdue Pharma. He also reported involvements on contracts and grants with Parke-Davis, Boehringer Ingelheim, Elan, Ortho Biotech, Endo, Ametek, Medtronic, Purdue Pharma, Pfizer, Janssen, Abbott, Curatech, Ortho-McNeil and Searle.
James Heins, a spokesman for Purdue, said that “it is implausible that our marketing caused an upsurge in overall prescriptions of opioids or in the incidence of abuse” because the company commands only a small portion of the painkiller market.
Moreover, he said, the notion that the risk of addiction was small was “not based on studies funded by Purdue but rather on the larger body of medical literature and clinical experience.”
Even today, he said, it is difficult to say exactly how many people who are prescribed opioids become addicted.
‘Absolutely devastating’
In few places are the effects of the opioid epidemic clearer than in Portsmouth, a town near Ohio’s borders with West Virginia and Kentucky. About 10 percent of babies are born addicted to opioids. At one point, nine “pill mills” operated out of this region of 80,000 people. About 20 people a year die of drug overdoses. Last year, for every resident, more than 100 doses of opioids were prescribed and dispensed.
Ask someone here whether the risks of opioid addiction are minimal, and some snort or roll their eyes.
“Around here, we call it ‘pharmageddon,’ ” said Lisa Roberts, the public health nurse for the town, whose primary job is to reduce the fatalities associated with drug use. “This has been absolutely devastating to Appalachia. From what we’ve seen, the risks of addiction were tremendous.”
For decades, many doctors had been wary of prescribing opioids except for use by cancer patients and the terminally ill.
In 1992, for example, a survey of state medical board members, most of them physicians, found that only 12 percent described prescribing opioids for an extended period for chronic pain as a “lawful and generally acceptable medical practice.”
Advocates for opioid prescription, backed in part by drugmakers, set about seeking to change those attitudes. More than 20 states changed their rules. And in December 1995, these marketing efforts surged as Purdue Pharma introduced OxyContin, a controlled-release form of the opioid oxycodone.
From 1996 to 2000, the company doubled its sales force from 300 to 671, according to a 2003 report by what was then the General Accounting Office. The amount of sales bonuses Purdue Pharma offered tied to OxyContin grew from $1 million a year to $40 million a year. It sponsored pain-related Web sites, advertised in medical journals and paid influential doctors such as Portenoy to talk to other physicians.
As the number of overdoses and reports of addicts rose in the early 2000s, key questions arose. How were the addicts becoming addicted? Was it by going to the doctor with a legitimate pain and getting a legitimate prescription? Or was it just people seeking a high and buying the prescription drugs off the street?
If it was only the latter, limiting prescriptions might have little direct effect on the problem and could penalize pain sufferers.
But it was both. Although many addicts started on opioids just to get high, experts say, a good portion arrived at their habits after coming into contact with opioids after a doctor’s visit for a legitimate pain. That’s how Leslie Cooper came to the drug, and it is reportedly the way some celebrities became addicted: Rush Limbaugh, Matthew Perry, Cindy McCain.
Other trials have reported that significant numbers of pain patients are addicted. In one review out of Yale School of Medicine, investigators found that diagnoses of addiction are “common” in patients given opioids for back pain, with as many as 24 percent engaging in “aberrant” or peculiar ways of taking the pills.
Early on, officials at the Drug Enforcement Administration perceived the danger to patients.
“The company’s aggressive methods, calculated fueling of demand and the grasp for major market share very much exacerbated OxyContin’s widespread abuse and diversion,” a November 2003 memo from the agency said. “The claim in Purdue’s ‘educational’ video for physicians that opioid analgesics cause addiction in less than one percent of patients is not only unsubstantiated but also dangerous because it misleads prescribers.”
But amid the marketing blitz, concerns about addiction in patients appear to have faded from the medical profession.
The FDA, which must approve drug labels, allowed Purdue to say on its label: “The development of addiction to opioid analgesics in properly managed patients with pain has been reported to be rare.”
The agency warned that drug abusers and addicts might try to obtain the drugs, but it indicated that the risks seemed minor for patients: “We do not know how often patients with continuing (chronic) pain become addicted to narcotics, but the risk has been reported to be small.”
The agency, however, would later change its mind.
By 2008, the claims that the risks of addiction in patients were small were removed from the OxyContin label, after “extensive negotiations” with Purdue, an FDA spokeswoman said.
“The labeling information, including language regarding addiction, has evolved over time as data has become available,”Morgan Liscinsky said.
The FDA did not say what evidence led the agency to allow the previous claims or what new findings led it to ask for the removal of those claims.
Early on, however, the agency relied on industry experts for advice. In the 2002 FDA meeting, for example, eight of the 10 invited experts had connectionswith pharmaceutical companies. Of those, five had served as speakers, consultants or investigators for Purdue, including Portenoy and Kathy Foley, a neuro-oncologist at Memorial Sloan Kettering Cancer Center. Together, Portenoy and Foley had published a key study on opioids in 1986 that found that only two of 38 patients seemed to abuse the drugs and that both had histories of substance abuse.
“Their past work with industry should not preclude them from sharing their expertise with government agencies or their peers in the medical community,” Heins, the Purdue spokesman, said.
The FDA and doctors also could turn to a spate of other trials that seemed to suggest there was little reason to worry that chronic pain patients could get addicted to opioids.
Take, for example, a 2003 report in the New England Journal of Medicine, which reviewed the conclusions from several studies.
“The general finding is that patients with chronic pain . . . can achieve satisfactory analgesia . . . with a minimal risk of addiction,” it said, while questioning the use of high doses.
What may be most striking about the paper, though, is that its lead author has become one of the top critics of opioid prescribing habits. But Jane Ballantyne, a pain specialist at the University of Washington, said that at the time there were very few clinical trials that showed any sign of an addiction risk.
“There were very few studies then that suggested that any more than 8 percent of people on prescription opioids exhibited addiction-type behaviors,” Ballantyne said. Now, she said, the understanding is that the number may be as high as 50 percent.
How did all these studies — co-authored by doctors with university affiliations and published in academic journals — lead to conclusions that now are in dispute?
One reason, according to critics, is that most of the studies were conducted by drug companies.
“A pharmaceutical company that has a vested interest in promoting their product should not be seen as a reliable source of safety information,” said Orman Hall, director of the Ohio Department of Alcohol and Drug Addiction Services. “Some of those estimates are ludicrous.”
Consider the 16 clinical trial reports that Ballantyne highlighted and used in her article, which reflect the medical literature at the time. Her summary did not discuss sponsors of the studies. But of those 16, six were sponsored by Purdue Pharma or co-authored by its employees, one was sponsored by Mundipharma, which distributed OxyContin and other opioids, and two were sponsored by another drug company or co-authored by drug company employees.
In the trials, patients were given an opioid for pain, but in most, there were no systematic checks for withdrawal symptoms or addiction. Instead, in most of the trials, regardless of whether they were sponsored by drug companies, the investigators generally found that the benefits of pain relief outweighed the risks of side effects such as constipation and dry mouth.
If investigators were looking for signs of addiction, they weren’t looking hard.
“In the absence of rigorous evaluation and surveillance, it’s hard to know whether the low levels of addictive behavior reported in those studies are accurate,” said David A. Fiellin, a professor of medicine at Yale with an expertise in addiction.
Fiellin noted that the design of a study can dramatically change the results and that entrusting the design to scientists with conflicts of interest could introduce bias. What patients are admitted to the trial? How are side effects measured? How large are the doses?
“All of those are scientific decisions that should be made by people without any regard for how the findings will affect the company’s bottom line,” Fiellin said, adding that the government could play a larger role in funding.
Data discrepancy
In one of the studies sponsored by Purdue that Ballantyne covered, and that played a large role in the marketing of OxyContin, there appear to have been significant discrepancies between the data that were gathered and those that were published.
A March 2000 issue of the Archives of Internal Medicine published a study that followed 106 arthritis patients treated with OxyContin for several months.
Six times during the trial, researchers intentionally stopped the doses.
Remarkably, according to doctors who study addiction and dependence, there were no reports of withdrawal during those respites.
Two patients had withdrawal problems, but one was at the end of the study, and the other had simply run out of the medication.
“Withdrawal syndrome was not reported as an adverse event for any patient during the scheduled respites,” the authors reported.
The trial also showed that the drug was effective and was embraced by the Purdue marketing team, which ordered 10,000 reprints to distribute to its sales staff, with instructions to highlight the finding on withdrawal.
But according to company documents disclosed in a court case, the paper left out several cases of withdrawal.
Inside Purdue, supervisors and employees reviewed a more complex set of data, according to a document signed by company attorneys and prosecutors, which accompanied a 2007 settlement in which federal prosecutors charged Purdue with misbranding the drug.
The document has not previously been linked to the Archives article.
“Multiple” patients, a company review said, “directly stated or implied that an adverse experience was due to possible withdrawal symptoms.”
Eleven study patients “reported adverse experience due to possible withdrawal symptoms during these periods,” according to the court document.
How did this discrepancy arise?
One of the authors of the Archives article, Roy Fleischmann, a clinical professor of medicine at the University of Texas Southwestern Medical Center at Dallas, said the authors were given the data by Purdue.
“We reported on the data which was provided to us,” he wrote.
He said the discrepancy may have arisen because some of the side effects — such as insomnia, nausea and anxiety — were not characterized by Purdue “as withdrawal symptoms, although, in retrospect, they probably were,” he said in an e-mail.
Doctors who have treated OxyContin addicts, and some former addicts, moreover, say that considering the doses given to the patients in the trial and its duration, even the internal document undercounted patients reporting withdrawal symptoms. They say the majority of patients were likely to have suffered withdrawal symptoms when the drug was cut off.
At the doses given in the trial, most patients are “pretty consistently” going to have withdrawal symptoms, said Phillip Prior, a board-certified addictionologist in the Portsmouth area who has treated thousands of patients addicted to opioids.
He said the lower estimates are “flawed conclusions from a very flawed study.”
“I’ve never seen anyone come off of them and not get withdrawal,” said Billie Taylor, 42, a former addict who works at a treatment center in Portsmouth. “I would have quit a lot earlier if it had not been for the withdrawal. You feel like you want to die. Even if you take them at prescribed levels, you get withdrawal.”
“You could say these marketing tactics are merely concerning,” Prior said. “But I think of them as satanic. What the data are telling us is that these drugs are ruining people’s lives.”

http://www.washingtonpost.com/business/economy/rising-painkiller-addiction-shows-damage-from-drugmakers-role-in-shaping-medical-opinion/2012/12/30/014205a6-4bc3-11e2-b709-667035ff9029_story.html

More Wealth Addiction - 12 Step Program Needed

Wealth and money as an addiction -

For the Love of Money

By SAM POLKJAN. 18, 2014

IN my last year on Wall Street my bonus was $3.6 million — and I was angry because it wasn’t big enough. I was 30 years old, had no children to raise, no debts to pay, no philanthropic goal in mind. I wanted more money for exactly the same reason an alcoholic needs another drink: I was addicted.

Eight years earlier, I’d walked onto the trading floor at Credit Suisse First Boston to begin my summer internship. I already knew I wanted to be rich, but when I started out I had a different idea about what wealth meant. I’d come to Wall Street after reading in the book “Liar’s Poker” how Michael Lewis earned a $225,000 bonus after just two years of work on a trading floor. That seemed like a fortune. Every January and February, I think about that time, because these are the months when bonuses are decided and distributed, when fortunes are made.

I’d learned about the importance of being rich from my dad. He was a modern-day Willy Loman, a salesman with huge dreams that never seemed to materialize. “Imagine what life will be like,” he’d say, “when I make a million dollars.” While he dreamed of selling a screenplay, in reality he sold kitchen cabinets. And not that well. We sometimes lived paycheck to paycheck off my mom’s nurse-practitioner salary.

Dad believed money would solve all his problems. At 22, so did I. When I walked onto that trading floor for the first time and saw the glowing flat-screen TVs, high-tech computer monitors and phone turrets with enough dials, knobs and buttons to make it seem like the cockpit of a fighter plane, I knew exactly what I wanted to do with the rest of my life. It looked as if the traders were playing a video game inside a spaceship; if you won this video game, you became what I most wanted to be — rich.

IT was a miracle I’d made it to Wall Street at all. While I was competitive and ambitious — a wrestler at Columbia University — I was also a daily drinker and pot smoker and a regular user of cocaine, Ritalin and ecstasy. I had a propensity for self-destruction that had resulted in my getting suspended from Columbia for burglary, arrested twice and fired from an Internet company for fistfighting. I learned about rage from my dad, too. I can still see his red, contorted face as he charged toward me. I’d lied my way into the C.S.F.B. internship by omitting my transgressions from my résumé and was determined not to blow what seemed a final chance. The only thing as important to me as that internship was my girlfriend, a starter on the Columbia volleyball team. But even though I was in love with her, when I got drunk I’d sometimes end up with other women.

Three weeks into my internship she wisely dumped me. I don’t like who you’ve become, she said. I couldn’t blame her, but I was so devastated that I couldn’t get out of bed. In desperation, I called a counselor whom I had reluctantly seen a few times before and asked for help.

She helped me see that I was using alcohol and drugs to blunt the powerlessness I felt as a kid and suggested I give them up. That began some of the hardest months of my life. Without the alcohol and drugs in my system, I felt like my chest had been cracked open, exposing my heart to air. The counselor said that my abuse of drugs and alcohol was a symptom of an underlying problem — a “spiritual malady,” she called it. C.S.F.B. didn’t offer me a full-time job, and I returned, distraught, to Columbia for senior year.

After graduation, I got a job at Bank of America, by the grace of a managing director willing to take a chance on a kid who had called him every day for three weeks. With a year of sobriety under my belt, I was sharp, cleareyed and hard-working. At the end of my first year I was thrilled to receive a $40,000 bonus. For the first time in my life, I didn’t have to check my balance before I withdrew money. But a week later, a trader who was only four years my senior got hired away by C.S.F.B. for $900,000. After my initial envious shock — his haul was 22 times the size of my bonus — I grew excited at how much money was available.

Over the next few years I worked like a maniac and began to move up the Wall Street ladder. I became a bond and credit default swap trader, one of the more lucrative roles in the business. Just four years after I started at Bank of America, Citibank offered me a “1.75 by 2” which means $1.75 million per year for two years, and I used it to get a promotion. I started dating a pretty blonde and rented a loft apartment on Bond Street for $6,000 a month.

I felt so important. At 25, I could go to any restaurant in Manhattan — Per Se, Le Bernardin — just by picking up the phone and calling one of my brokers, who ingratiate themselves to traders by entertaining with unlimited expense accounts. I could be second row at the Knicks-Lakers game just by hinting to a broker I might be interested in going. The satisfaction wasn’t just about the money. It was about the power. Because of how smart and successful I was, it was someone else’s job to make me happy.

Still, I was nagged by envy. On a trading desk everyone sits together, from interns to managing directors. When the guy next to you makes $10 million, $1 million or $2 million doesn’t look so sweet. Nonetheless, I was thrilled with my progress.

My counselor didn’t share my elation. She said I might be using money the same way I’d used drugs and alcohol — to make myself feel powerful — and that maybe it would benefit me to stop focusing on accumulating more and instead focus on healing my inner wound. “Inner wound”? I thought that was going a little far and went to work for a hedge fund.

Now, working elbow to elbow with billionaires, I was a giant fireball of greed. I’d think about how my colleagues could buy Micronesia if they wanted to, or become mayor of New York City. They didn’t just have money; they had power — power beyond getting a table at Le Bernardin. Senators came to their offices. They were royalty.

I wanted a billion dollars. It’s staggering to think that in the course of five years, I’d gone from being thrilled at my first bonus — $40,000 — to being disappointed when, my second year at the hedge fund, I was paid “only” $1.5 million.

But in the end, it was actually my absurdly wealthy bosses who helped me see the limitations of unlimited wealth. I was in a meeting with one of them, and a few other traders, and they were talking about the new hedge-fund regulations. Most everyone on Wall Street thought they were a bad idea. “But isn’t it better for the system as a whole?” I asked. The room went quiet, and my boss shot me a withering look. I remember his saying, “I don’t have the brain capacity to think about the system as a whole. All I’m concerned with is how this affects our company.”

I felt as if I’d been punched in the gut. He was afraid of losing money, despite all that he had.

From that moment on, I started to see Wall Street with new eyes. I noticed the vitriol that traders directed at the government for limiting bonuses after the crash. I heard the fury in their voices at the mention of higher taxes. These traders despised anything or anyone that threatened their bonuses. Ever see what a drug addict is like when he’s used up his junk? He’ll do anything — walk 20 miles in the snow, rob a grandma — to get a fix. Wall Street was like that. In the months before bonuses were handed out, the trading floor started to feel like a neighborhood in “The Wire” when the heroin runs out.

I’d always looked enviously at the people who earned more than I did; now, for the first time, I was embarrassed for them, and for me. I made in a single year more than my mom made her whole life. I knew that wasn’t fair; that wasn’t right. Yes, I was sharp, good with numbers. I had marketable talents. But in the end I didn’t really do anything. I was a derivatives trader, and it occurred to me the world would hardly change at all if credit derivatives ceased to exist. Not so nurse practitioners. What had seemed normal now seemed deeply distorted.

I had recently finished Taylor Branch’s three-volume series on the Rev. Dr. Martin Luther King Jr. and the civil rights movement, and the image of the Freedom Riders stepping out of their bus into an infuriated mob had seared itself into my mind. I’d told myself that if I’d been alive in the ‘60s, I would have been on that bus.

But I was lying to myself. There were plenty of injustices out there — rampant poverty, swelling prison populations, a sexual-assault epidemic, an obesity crisis. Not only was I not helping to fix any problems in the world, but I was profiting from them. During the market crash in 2008, I’d made a ton of money by shorting the derivatives of risky companies. As the world crumbled, I profited. I’d seen the crash coming, but instead of trying to help the people it would hurt the most — people who didn’t have a million dollars in the bank — I’d made money off it. I don’t like who you’ve become, my girlfriend had said years earlier. She was right then, and she was still right. Only now, I didn’t like who I’d become either.

Wealth addiction was described by the late sociologist and playwright Philip Slater in a 1980 book, but addiction researchers have paid the concept little attention. Like alcoholics driving drunk, wealth addiction imperils everyone. Wealth addicts are, more than anybody, specifically responsible for the ever widening rift that is tearing apart our once great country. Wealth addicts are responsible for the vast and toxic disparity between the rich and the poor and the annihilation of the middle class. Only a wealth addict would feel justified in receiving $14 million in compensation — including an $8.5 million bonus — as the McDonald’s C.E.O., Don Thompson, did in 2012, while his company then published a brochure for its work force on how to survive on their low wages. Only a wealth addict would earn hundreds of millions as a hedge-fund manager, and then lobby to maintain a tax loophole that gave him a lower tax rate than his secretary.

DESPITE my realizations, it was incredibly difficult to leave. I was terrified of running out of money and of forgoing future bonuses. More than anything, I was afraid that five or 10 years down the road, I’d feel like an idiot for walking away from my one chance to be really important. What made it harder was that people thought I was crazy for thinking about leaving. In 2010, in a final paroxysm of my withering addiction, I demanded $8 million instead of $3.6 million. My bosses said they’d raise my bonus if I agreed to stay several more years. Instead, I walked away.

The first year was really hard. I went through what I can only describe as withdrawal — waking up at nights panicked about running out of money, scouring the headlines to see which of my old co-workers had gotten promoted. Over time it got easier — I started to realize that I had enough money, and if I needed to make more, I could. But my wealth addiction still hasn’t gone completely away. Sometimes I still buy lottery tickets.

In the three years since I left, I’ve married, spoken in jails and juvenile detention centers about getting sober, taught a writing class to girls in the foster system, and started a nonprofit called Groceryships to help poor families struggling with obesity and food addiction. I am much happier. I feel as if I’m making a real contribution. And as time passes, the distortion lessens. I see Wall Street’s mantra — “We’re smarter and work harder than everyone else, so we deserve all this money” — for what it is: the rationalization of addicts. From a distance I can see what I couldn’t see then — that Wall Street is a toxic culture that encourages the grandiosity of people who are desperately trying to feel powerful.

I was lucky. My experience with drugs and alcohol allowed me to recognize my pursuit of wealth as an addiction. The years of work I did with my counselor helped me heal the parts of myself that felt damaged and inadequate, so that I had enough of a core sense of self to walk away.

Dozens of different types of 12-step support groups — including Clutterers Anonymous and On-Line Gamers Anonymous — exist to help addicts of various types, yet there is no Wealth Addicts Anonymous. Why not? Because our culture supports and even lauds the addiction. Look at the magazine covers in any newsstand, plastered with the faces of celebrities and C.E.O.'s; the superrich are our cultural gods. I hope we all confront our part in enabling wealth addicts to exert so much influence over our country.

I generally think that if one is rich and believes they have “enough,” they are not a wealth addict. On Wall Street, in my experience, that sense of “enough” is rare. The money guy doing a job he complains about for yet another year so he can add $2 million to his $20 million bank account seems like an addict.

I recently got an email from a hedge-fund trader who said that though he was making millions every year, he felt trapped and empty, but couldn’t summon the courage to leave. I believe there are others out there. Maybe we can form a group and confront our addiction together. And if you identify with what I’ve written, but are reticent to leave, then take a small step in the right direction. Let’s create a fund, where everyone agrees to put, say, 25 percent of their annual bonuses into it, and we’ll use that to help some of the people who actually need the money that we’ve been so rabidly chasing. Together, maybe we can make a real contribution to the world.

Sam Polk is a former hedge-fund trader and the founder of the nonprofit Groceryships.

http://www.nytimes.com/2014/01/19/opinion/sunday/for-the-love-of-money.html?_r=0

Fooling The People; Selling Nothingness

I find it hard to get my head around the idea that while massive amounts pf people pay their own money to wear corporate logos, this man gets paid to wear corporate logos...... you can fool most of the people most of the time.....

I’ll Be Your Billboard

Interview by ELIZABETH OLSONJAN. 25, 2014

Jason Sadler, 31, now Jason SurfrApp, is based in Jacksonville, Fla., and appears on social media wearing corporate T-shirts for a fee.

Q. How did you get the idea to have companies pay you for wearing their T-shirts?

A. Clients at my web design firm were asking about social media, and since most companies already have a T-shirt, I realized that would be a good promotional vehicle. I started (web site I decline to promote) in 2009, to offer funny photo and video campaigns featuring corporate T-shirts.

How does it work?

Companies, organizations or, really, anyone pay me to wear their T-shirt for a day on my website and on social media like Twitter and Facebook. I have about 40,000 Twitter followers, and more than 12,000 Facebook fans. I also wear the shirts on videos on YouTube, Ustream and Flickr. I started by charging an amount for each day, beginning with $1 for Jan. 1, 2009, and $2 for the next day and so on — up to $365 for the final day of the year. Since then I have increased the daily price.

How did you get the idea off the ground?

I contacted everyone I knew. Zappos bought the Jan. 29, 2009, slot, for $29. So far, we have had some 1,500 clients.

Do you ever stand on street corners wearing different T-shirts?

No, I work out of my house, in an office where one wall is bright yellow, to use for photo and video backdrops.

Can you make a living wearing a different T-shirt every day?

The first year, the company earned more than $66,000, and that has grown as IWearYourShirt.com has gotten millions of views. And I have had some big brands, like Nissan and Starbucks, as clients. Now we are offering campaigns with groups of people wearing a company T-shirt.

What is the downside?

Continually thinking up videos and photos that catch people’s attention. I got burned out and focused for a while on selling my last name online. Headsets.com, a marketer, bought it for $45,500 in 2012, and last year SurfrApp, where people document and share their surfing adventures, bought it for $50,000. After each purchase, I legally changed my last name, first to Headsetsdotcom, then SurfrApp. On Twitter and other sites my name is now Jason SurfrApp.

Vocations asks people about their jobs. Interview conducted and condensed by Elizabeth Olson.

http://www.nytimes.com/2014/01/26/jobs/ill-be-your-billboard.html

Money And Wealth Addiction

All kinds of junkies.......

Research by Stanford’s Jeffrey Pfeffer Shows the Addictive Power of Money

Stanford Graduate School of Business January 9, 2014 9:00 AM

STANFORD, Calif.--(BUSINESS WIRE)--

The importance we place on money affects our lives in myriad ways, from where we live to the kind of job we choose to the amount of time we spend on work or leisure. Conventional wisdom — as well as economic theory — says the more of something we have, the less of it we want, but that’s not the case with money, where more is rarely enough.

Now, research from Jeffrey Pfeffer, a professor of organizational behavior at Stanford Graduate School of Business, may shed some light on why money can be addictive and how that addiction may be contributing to increasingly high CEO compensation packages. The paper “When Does Money Make Money More Important?” shows that money earned through labor is more important to people than money that comes from other sources (such as investments or a winning lottery ticket). And the more money paid for each hour of work, the more important that money becomes.

The paper, published in the ILRReview, is the result of research Pfeffer did with Sanford E. DeVoe, an associate professor at the University of Toronto’s Rotman School of Management, and Byron Y. Lee, an assistant professor at Renmin Business School, Renmin University of China. It was inspired by a quote from Daniel Vasella, the former CEO of Swiss pharmaceutical giant Novartis AG, who declined a $78 million severance package last February after a public backlash over it. In a 2002 interview with Fortune magazine, Vasella said: “The strange part is, the more I made, the more I got preoccupied with money. When suddenly I didn’t have to think about money as much, I found myself starting to think increasingly about it.”

Pfeffer saw that quote again a few years ago, and it got him and his research colleagues thinking that not only does money have an ability to fulfill real needs — such as buying food, shelter, and clothing — but also it signals worth and competence. People generally believe their pay level communicates how much an organization values them. “It occurred to us that it was quite possible money operated differently than other things we acquire, and that the more money you had, the more important it became,” he says.

To test their theory, the researchers examined the effect of changes in the amount of money received on changes in the importance of money over time. They relied on the British Household Panel Survey, a longitudinal survey from 1991-2009, that asked, among other questions, how important “having a lot of money” was on a scale of 1 to 10, with 10 being “very important.” Pfeffer and his colleagues calculated an estimated hourly wage rate, assuming that if money signaled someone’s value, that signal would be best observed in the income earned per hour. They also analyzed non-labor-related sources of money, such as rent, savings, and investments, as a contrast to money received from an employer.

The analysis showed that the higher the hourly rate of labor income, the more importance the person placed on money. The same was not true for money received through other sources.

In a second study, 71 students from a large Canadian university were shown how to make origami paper planes and given five minutes to make as many as they could. Each participant received an evaluation sheet that gave them a “very good” rating on both quality and quantity, and then received an envelope containing either $1 or $10. Some participants were told they had received the money randomly; others were told they received it based on their work. Afterwards, participants were asked questions about how valuable money was to them. The results showed that people receiving the money randomly, no matter the amount, didn’t differ in their rating of the importance of money. But those who received an extra $10 for the quality of their work rated money as significantly more important than those participants who received an extra $1 based on work quality.

The third study involved 41 students from a large Canadian university, also asked to make the paper airplanes. They were all paid $10 afterwards, but some were told it was based on the quantity and quality of their planes, while others were told the payment was random.
Those who believed they received money based on the quality of their work subsequently created significantly more planes than those who believed the money was randomly awarded.

Pfeffer said the three studies make one point: Money that comes from the work we do makes that money more important to us. “The money in that case is a signal of competence and worth, and that makes it addictive, because the more you have, the more you want,” he says. Understanding that might help explain why increasing numbers of top executives are receiving outsize compensation packages. “No one wants to be paid below the median because everybody thinks they are above average,” says Pfeffer. “There’s a compensation rat race going on, but the centerpiece of the story is that the more money people get, the more salient that money becomes.”

Although Pfeffer doesn’t have a prescription for ending money addiction, he does believe that if society really wanted to put an end to over-the-top executive compensation, “We would do what we have done with other addictive substances — tax it. That’s what public policy has done in the past to restrict the use of legal drugs like alcohol and nicotine — we tax them,” says Pfeffer. Taxing enormous compensation packages at a higher rate would create a disincentive for the payouts and might slow the compensation rat race.

This research also has implications for rank-and-file compensation. Because companies generally reward good employee performance with money, that money “becomes equivalent to the love of the organization,” says Pfeffer, and it will never be enough because it is so strongly connected to people’s feelings of self-esteem and self worth. “Companies should try to find other ways to signal competence and worthiness to their employees,” he says, such as helping them find purpose or meaning in the work itself, rather than the compensation.

The complete paper is available at: http://digitalcommons.ilr.cornell.edu/ilrreview/vol66/iss5/3/

Contact:

Stanford Graduate School of Business
Katie Pandes, 650-724-9152
pandes_katie@gsb.stanford.edu

http://finance.yahoo.com/news/research-stanford-jeffrey-pfeffer-shows-140000912.html 

Corruption Lives Here

Corruption has all sorts of addresses - uptown, downtown, all around town........

The Gadfly of Greenwich Real Estate

By LANDON THOMAS Jr.JAN. 25, 2014

"The road, to me, represents all that is sordid in our modern business world, money-grubbing poseurs putting on airs, until the handcuffs are slapped on," Mr. Fountain said. Andrew Sullivan for The New York Times

As he drives his white pickup truck past the manors that crowd the hills and meadows along Round Hill Road in Greenwich, Conn. — a town that has long signified what it means to be rich in America — Christopher Fountain snorts.

One of the gaudy estates is owned by a hedge fund kingpin now residing in prison; others belong to a real estate investor just coming out of prison and an investment adviser who steered his clients and their billions to Bernard L. Madoff. Then, to cap it off, a guy in an 8,000-square-foot mansion is charged with crushing his wife’s skull in with a baseball bat.

This is “Rogues Hill Road,” or so Mr. Fountain has called this 3.5-mile stretch of asphalt. “All these aspirational schnooks came out here thinking that they had really made it,” said Mr. Fountain, a real estate broker, blogger and lifelong Greenwich resident. “But then the tide went out and what you are left with is a bunch of crooks.”

Believe it or not, Mr. Fountain actually makes a living brokering mega-mansion real estate deals to these so-called schnooks, among others.

And his blog, For What It’s Worth, has attracted a cult following among those he lampoons — the financial titans who can afford to plunk down $5 million or more on a house but who nonetheless seem to appreciate his scabrous take on Greenwich residents’ run-ins with the law, debt-fueled implosions or plain old bad taste.

Indeed, Mr. Fountain would seem to spend as much time selling schadenfreude as houses.

The essence of his complaint — that decades of easy money and ceaseless greed have created a glut of unsalable houses that will remain a blight on his hometown for many years — highlights one of the more curious anomalies of today’s explosion in asset prices.

Though the Federal Reserve’s policy of rock-bottom interest rates over the last few years has revived the value of many of the nation’s subdivisions and sent stocks soaring to historic highs, it has prompted only modest interest in the over-the-top Greenwich mansion, a classic emblem of quick riches.

Mr. Fountain likes to point to the prominent Greenwich characters in the public spotlight as part of the problem. Topping Mr. Fountain’s list of homeowners are Raj Rajaratnam, the hedge fund executive now serving an 11-year prison sentence on charges of insider trading, and Frederic A. Bourke Jr., co-founder of Dooney & Bourke, the high-end handbag accessories store, who has just been imprisoned for bribery and whose house is on the market for $13 million.

He also likes to skewer Walter Noel, a founder of Fairfield Greenwich, the investment firm that raised more than $8 billion for Mr. Madoff and subsequently became the target of investigations. Mr. Noel’s 175 Round Hill address is just across the road from Mr. Bourke’s home. The estate of Steven A. Cohen, whose hedge fund pleaded guilty to insider trading charges in November, is six miles east of Round Hill Road.

Mr. Fountain includes in his gallery plenty of lesser-known people pushed into bankruptcy after overreaching, borrowing millions to build 15,000-square-foot houses that no one wanted to buy.

Mr. Fountain’s contention that the legal and financial troubles bedeviling Greenwich big shots have contributed to this slump — a view that is hotly disputed by his more established competitors — is more anecdotal than scientific. Still, the numbers are stark.

According to Trulia, the real estate website, the average price per square foot of a four-bedroom house sold in Greenwich in the last three months was $442, down 40 percent from a year ago and 11 percent from 2009.

Mr. Fountain says that more than 43 houses are on the market for at least $10 million — many of them unsold for more than a year.

What will it take to sell them?

“My rule of thumb now is divide the asking price by two,” he said. “Although the owner’s ego always makes that very hard to do.”

Mr. Fountain began to vent on his blog about two years ago.

“I’m sure Greenwich attracted some nefarious characters back in the ’50s and ’60s, but the past decade has seen just a parade of sad sack crooks,” Mr. Fountain wrote in a cri de coeur about how the 100-acre pastures and graceful mansions of his youth had been replaced by garish castles squeezed onto four-acre lots.

This was especially true, he felt, of Round Hill Road. “The road, to me, represents all that is sordid in our modern business world, money-grubbing poseurs putting on airs, until the handcuffs are slapped on.”

It is tempting to dismiss this as an old-money lament from someone who missed out on the past decade’s asset boom. While Mr. Fountain’s father rode the train into Grand Central every morning to a Wall Street job at White Weld, a white-shoe investment firm that is now defunct, his own career path has been rockier.

After practicing law in Bangor, Me., Mr. Fountain returned to Greenwich, where he spent most of his time defending small investors suing big Wall Street banks over dubious investment advice. He quit his job in 2000 after publishing his first book, “The New Millionaire’s Handbook: A Guide to Contemporary Social Climbing.” But his writing career stalled, and in 2001 he beat a retreat to selling houses. At the age of 60, Mr. Fountain has had three careers over the last decade and now rents a modest farmhouse in North Stamford, Conn., about 10 miles from Round Hill Road.

Nevertheless, his outbursts over new-money excesses in Greenwich have struck a vein, attracting readers who, Mr. Fountain says, include not just bankers and local real estate mavens but also followers in Europe and Asia. Cliff Asness, the billionaire hedge fund manager, has commented on the blog, and Mr. Fountain’s taste for Greenwich gossip makes him all the more appealing.

“Fountain is great,” said a defense lawyer for a legally encumbered Greenwich resident who has come in for punishment on the blog. “He is really catnip for all of us.”

One investment banker who recently used Mr. Fountain to sell and buy a house appreciates his forthrightness.

“If he thinks the house you are trying to sell is worth $1 million and not $5 million he will tell you,” said the banker, who spoke on condition of anonymity because his firm did not permit him to speak to the press. “Plus, his blog is hilarious.”

Much of it consists of his rightward-leaning libertarian and politically incorrect rants in which he mercilessly sends up — in equal measure — what he sees as the big-government vanities of the Obama administration and the arrogance of those who think they have arrived just because they could secure a $10 million mortgage.

With his raspy growl of a voice, his pickup truck and his trusty bow and arrow, which he deploys when deer-hunting season rolls around, Mr. Fountain might be as close as Greenwich comes to a redneck. And even if it is all a bit of an act, the shtick — selling real estate requires self-promotion of one kind or another — has been great for his business.

“The hedgies love me — it’s amazing how successful you can be if you tell the truth,” he said. “Last year was great, but it really kicked off when I started going on about Walter Noel and Rogues Hill Road.”

Still, in the competitive Greenwich market, where 1,000 people out of a population of 61,000 are licensed to sell houses, there are those who wonder if Mr. Fountain’s footprint is as big as he contends. While the $20 million in sales that he and his business partner generated in 2012 put him in the top tier of the local broker pool — 2013 was a harder slog, he says — some rival agents say his presence was hardly felt in previous years.

They also reject his assertion that the market for big-ticket houses is in terminal decline.

“It really bothers me when he talks about the market like this because it is just not true,” said David Ogilvy, the longstanding dean of the mansion market in Greenwich, who also has suffered his share of pokes on the blog.

To prove his point, Mr. Ogilvy ticks off his firm’s sales in recent months: $13.4 million, $14.5 million, $24 million.

But other real estate agents say large houses often sell for far less than the asking price these days.

“This is still a buyer’s market,” said W. Harry Pool, a longtime investment banker turned real estate broker at Halstead Property in Greenwich. “If you want to sell your $10 million house, you really have to have the best $10 million house out there.”

When he is not hunched over a laptop or in pursuit of deer, Mr. Fountain spends most of his days cruising around town in his pickup.

“I mean this is insanity — it’s just a garish pile of bricks,” he growled in the fall, as he drove past yet another 10,000-square-foot, slightly worse for wear and quite empty house. Like so many of its ilk, the house had been slapped together in a few months by a highly leveraged speculator; unable to pull in the $9 million needed to clear his debts, he had to surrender it to the bank.

And who signed off on the mortgage? “Patriot Bank, of course,” Mr. Fountain said, spitting the words.

Of the many that have suffered a whipping from Mr. Fountain over the years, few have been subjected to as much sustained abuse as Patriot National Bank, the small regional lender that is based nearby, in Stamford, and bankrolled some of Greenwich’s most egregious mortgage disasters.

“Patriot was in a pretty bad place when we took over,” concurred Michael A. Carrazza, whose investment firm, Solaia Capital Advisors, rescued the bank in 2010 and restored it to good health. About one-third of the bank’s loan portfolio, he said, consisted of nonperforming loans belonging to those owning high-end houses in and around Greenwich. Many of the loans went to highflying Wall Street titans, but a surprising number were directed to other borrowers, like Jianhua Tsoi, an acupuncturist and aspiring artist, who borrowed $40 million to build at least five houses in and around Greenwich, few of which he was able to sell.

Another Patriot borrower was Dominick DeVito, a builder and renovator of big homes who, when he took up residence on Round Hill Road in 2005, had already served a term in prison for real estate fraud.

After a profitable run, he became overextended, borrowing $6 million from Patriot in 2006 to build and flip his most spectacular house yet.

When the market collapsed, Mr. DeVito’s bankers got cold feet, shut down his credit line and took possession of his nearly completed house. In 2009, he was sent to prison again on mortgage charges related to his earlier real estate activities in New York.

That Mr. DeVito — an Italian-American kid from the rougher side of Eastchester, N.Y., and with no college education — would end up on Greenwich’s most prestigious thoroughfare is in itself a bit of a curiosity.

“I mean I was a paint contractor,” said Mr. DeVito in an interview last year, as he took in the swimming pool, the rolling green hills and the white picket fence from the front porch of his house. “Now I am on Round Hill Road?”

Since his release from prison in early 2013, Mr. DeVito has jumped back into the real estate game with a vengeance — plying the back roads of Greenwich in search of unloved mansions that he might snap up, tear down and sell for a profit.

“I am done with the banks, though,” he said. Instead, he is looking to rich people in Greenwich to put up the cash, with profits to be split down the middle.

“I mean,” he said with one of his signature, flashing white grins, “it’s not rocket science, is it?”

For the Wall Street types, however, headline-grabbing failure is harder to brush off.

Consider Joseph F. Skowron III, known as Chip, whose $8 million house is on 16 Doubling Road, just a few miles east of Round Hill Road. A hedge fund investor, he was caught in 2011 doling out envelopes of cash in return for nonpublic stock tips and was sent to prison for five years. Once worth around $20 million, he left behind a wife, four small children and a garage once full of high-end sports cars.

Having already paid $7.7 million in fines to the United States government, Mr. Skowron was ordered last month to pay $24 million in past wages — beyond the $10 million he has already paid to his former employer, Morgan Stanley.

When a guy named Chip, with a dimple in his chin and a luxurious home on the edge of the local country club, commits and then admits to an egregious financial crime, the knives come out quickly.

“How warped can a guy get just to accumulate a 10-car collection of speedsters and a big Greenwich house,” wrote Mr. Fountain on his blog late last year, no doubt exaggerating the number of cars Mr. Skowron owns. “He now has plenty of time to ponder that question. Chump.”

Peter Tesei, the town’s first selectman, is quick to point out that a vast majority of Greenwich’s 61,000 residents are citizens in good standing. But even some of those have their pasts. And perhaps no one is better qualified to add a bit of heft to Mr. Fountain’s thesis than David A. Stockman, who was the budget whiz kid of the Reagan administration.

In his 712-page book, “The Great Deformation,” Mr. Stockman argues that the relentless money-printing of the Federal Reserve has created a pernicious cycle of greed and excess.

“This is just not sustainable — the bubbles are getting bigger and the busts are becoming more traumatic,” Mr. Stockman said. “And with each subsequent reflation the wealth and income is flowing into a smaller set of hands at the very tippy-top of the economic ladder.”

Mr. Stockman speaks from experience.

In the 1990s, he was a top executive at the private equity shop Blackstone and erected a 15,000-square-foot estate in the gated Greenwich community of Conyers Farm.

When the debt bubble burst in 2007, Mr. Stockman’s final private equity play — a car parts supplier — failed spectacularly. Federal prosecutors charged him with fraud but withdrew the case two years later.

In 2012, Mr. Stockman put his trophy home — with its 11 bathrooms, swimming pool and tennis court — on the market, asking $19.75 million.

Weak as the market was, the listing was removed — and Mr. Fountain is not surprised.

“For $9 million, it’s a nice little house,” he said. “But these types of houses don’t age well. There is just too much horse crap out there on the polo fields.”

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The home of Michael DeMaio, who has been charged with beating his wife there with a baseball bat. Andrew Sullivan for The New York Times

 

 

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The home of Dominick DeVito on Round Hill Road in Greenwich, Conn. Mr. DeVito, a builder and renovator of large homes, returned to real estate work after his release from prison early in 2013. Andrew Sullivan for The New York Times

http://www.nytimes.com/2014/01/26/business/the-gadfly-of-greenwich-real-estate.html?_r=0