I can't think of a state less equipped to deal with major health insurance rate hikes than Michigan, currently mired with - this will not be a typo - 15.6% unemployment. But that's exactly what they're getting.

In the past few days, 114,000 Michigan households have received bad-news letters from Blue Cross Blue Shield of Michigan, socking individual health insurance subscribers with premium increases averaging 22%, effective Oct. 1.

Blue Cross could have said, "Hey, things could have been worse. We asked for a 56% rate hike first and dialed it back to 22%" -- but that probably would have just made folks angrier.

Instead, the Blue Cross letters simply stated, "We know every Michigan resident faces financial challenges, and we thank you for your business and loyalty to the Blues."

The two numbers, unemployment and rate hikes, have a correlation. Individual insurance has expanded by 96% at Blue Cross of Michigan in the past two years. That's because they act like a non-profit state "co-op" would in a private sector allowed to discriminate against their customers:

In just the past two years, the number of under-65 individual subscribers has grown by 59,000, or 96%, at Blue Cross, the nonprofit "insurer of last resort" in Michigan. Private for-profit insurers tend to cherry-pick younger, healthier consumers, driving older and less-healthy people to Blue Cross if they have no employer-provided group coverage.

State law requires Blue Cross to offer insurance to anyone, but it also demands that the company not lose money on its insurance products. Therein lies the rub: Blue Cross lost $133 million last year on individual subscribers.

This is that "perfect market" that conservatives like to talk about. Given the ability to discriminate over its customers, private insurers dump the sick on to Blue Cross. And because the state requires Blue Cross to break even, they must raise their premiums basically at the rate of the cost of health inflation year-over-year, often on the poorest and most vulnerable members of society.

Michigan is not the only state seeing large rate hikes in its health insurance market. Oregon small businesses are seeing double-digit rate increases this year. In California, policies have gone up 9% since 2007, three times higher than the overall cost of living. Blue Cross and Blue Shield of Rhode Island has proposed a 16% rate hike, with UnitedHealth of New England up 11.6%. Washington state consumers will see large increases as well. Overall, increases by double digits are expected nationwide.

We hear from conservatives that businesses may drop their plans under health insurance reform. Actually, that's virtually assured if nothing is done. Companies, especially small businesses, will have no chance keeping up with these ever-increasing rates and hope to compete in the global marketplace. And ultimately, those businesses who do pay for these rate hikes do so out of potential wage increases for their employees. Wage growth stagnates and people wind up with less disposable income. The money funneled to health insurance companies could be used to reverse the recession and pull us into economic recovery. In this sense, insurance companies are acting like a siphon, reducing the fuel that can be used to drive the engine of growth.

And that siphon will take more and more money out of your pocket, unless we do something now.

[Photo by Ryan Wood, Midland Daily News]

Hard to believe, I know, but not all were joyous on Election Night. In Texas, Baylor students were bringing out the nooses. And in Midland, Michigan,: there was this guy:

A Midland man told police that his walking on the sidewalk in full Knights of Ku Klux Klan regalia while toting a handgun had nothing to do with Barack Obama winning the presidency.

Later, however, he admitted that Obama's victory was the catalyst for his display.

Midland police questioned Randy G. Gray II, 30, who was walking on the sidewalk along Eastman near North Saginaw Wednesday afternoon while waving an American flag, but released him because he wasn't breaking any laws.

Gray was walking up and down the sidewalk in front of a vehicle dealership while several motorists shouted obscenities at him and others shouted ''accolades,'' police said.

Randy Gray's name may ring some bells ...

Yep, that Randy Gray. He was tossed from the Ron Paul campaign when they discovered he was a Klansman. My guess is he didn't vote for McCain either.

Here he is in action at a Ron Paul rally "white power" event.

There are some things about the next four years I am definitely not looking forward to.

[Cross-posted at Orcinus.]

The Politico:

John McCain is pulling out of Michigan, according to two Republicans, a stunning move a month away from Election Day that indicates the difficulty Republicans are having in finding blue states to put in play.

McCain will go off TV in Michigan, stop dropping mail there and send most of his staff to more competitive states, including Wisconsin, Ohio and Florida. Wisconsin went for Kerry in 2004, Ohio and Florida for Bush.

McCain's campaign didn't immediately respond to a request for comment.

Oh, but don't fear you lurking McCain supporters...the RNC isn't leaving Michigan and most of McCain's staffers will move to their headquarters.

A McCain adviser confirmed the news but noted that the Republican National Committee's independent expenditure arm is still running ads there, and that McCain will keep most of his staff in-state. McCain officials and Michigan Republican Party officials declined to comment. Weirdly, McCain's staff scheduled a surrogate conference call with Mitt Romney for this afternoon, perhaps assuming that their shift in advertising would not be noticed or reported. The McCain move was disclosed one day after auto manufacturers based in the state reported record revenue declines. Previously, McCain has argued that Obama's intention to raise taxes on the rich would further deepen Michigan's worst-in-the-nation recession.

The move away from Michigan reflects the abandonment of any pretense that McCain can spend freely to expand the map for Republicans this year, and it's a sign that the campaign recognizes how the past two weeks have erased nearly all of McCain's gains since August.

In fact, the word on the street is that the RNC is planning a big blitz against ACORN in Milwaukee, since ACORN had a big voter registration blitz here.  Can't wait to see the barely veiled racism of those ads.