By
Russ Wung
May 14, 2009
The administration is treading lightly on the health-care front. Far from admitting that its health-care vision amounts to opening the Medicare program to all, it claims its subsidized “public option” for health insurance will only serve to extend coverage to the uninsured.
Supporters of the plan plug it as moderate in an attempt to pillory its opponents as obstructionists. But the compromise is an illusory one, for reasons of politics and efficiency.
According to the Wall Street Journal, a 1965 estimate by congressional actuaries projected that the cost of Medicare would reach $3.1 billion in 1970. The actual cost in that year was $6.8 billion. Today, Medicare costs $455 billion, which is the equivalent of about $66.5 billion in 1965 — enormous compared to the earlier figures, but probably peanuts compared to the cost of extending such coverage to everyone. The blogosphere’s favorite fantasies, abandoning the war on terrorism or dismantling our nuclear arsenal, wouldn’t come remotely close to cover the new program’s costs.
The complete failure of planners to anticipate this bloat in health-care expenditures by the state reflects the political hazards of any publicly funded welfare system.
As a consequence of our country’s tax code, which produces increasing levels of “representation without taxation,” only about half of voters now pay net taxes to the government. The non-paying half will naturally form a largely monolithic bloc favoring increasingly higher taxes on the paying half to expand their own benefits.
Major employers have expressed enthusiasm for the “public option.” Why? They want to get employees off their benefit rolls and onto the taxpayer dole.
This perfect storm of perverse incentives will guarantee a continuous engorgement of any public insurance option, similar to what we have observed with Medicare and other programs, but on a much larger scale. This isn’t a slippery slope; it’s a rapidly descending snowball.
Even worse, federal subsidies of the “public option” will undermine — or in economist’s parlance, “crowd out” — private insurance until the government becomes the dominant, if not the only, player in the market. Overall expenses will skyrocket, as those who could afford private insurance when it still existed enroll in the artificially cheap private option.
The statist claim that the free market has failed to deliver affordable health care is a diversion because there is no free market in individual health insurance in this country. Our tax code is atrociously stacked in favor of employer-based insurance, resulting in the current system. Unfortunately, market-based reforms have yet to be tried, and it is easy to view existing foreign welfare-state systems through rose-tinted glasses.
Universal health care in First World nations is indeed generally available to most people, but the rampant costs can only be kept down through inconsistent quality, long wait-lists, bureaucratic fiats concerning who will live and who will die, and obscene levels of taxation. Dissatisfaction with the status quo should not blind us to these harsh realities. Universal health care is surrender to the statist notion that health care is a zero-sum game.
Some elements of the left cite various polls claiming that the American people are clamoring for national health care. They even argue that the outcome of the election renders all of the administration’s goals democratically sacrosanct. Yet the backdoor approach, which Obama has taken in an attempt to implement this statist vision, suggests a lack of confidence in the popularity of outright government-run health care. We would do well to be wary.
Reach columnist Russ Wung at opinion@dailyuw.com.
3 Comments
#1 Roberta M.
on May 14, 2009 at 9:54 a.m.(Gig Harbor, WA)
You have a lot of misinformation in your article. Your characterization of First World universal health care seems based on right-wing polemic rather than facts. While there may be inconsistent quality and some long waits, the same situation exists here, especially with HMOs that restrict the pool of doctors their members can use and limit the kind of care their members can receive. However, "bureaucratic fiats concerning who will live and who will die, and obscene levels of taxation" is simply untrue, even in the UK, where the NHS actually is socialized medicine, unlike the Medicare of Canada. And taxation that is obscene to you is the contribution to a social network to others, assuring that there are protections for a country's people that are not based on their income or social status.
Where you are correct is in saying that the proposed health care reforms (though you are vague about defining them and seem to conflate differing plans) will not work. The plan that will work is Medicare for All, also called single payer, as laid out in Rep. John Conyers' HR 676. This plan removes health care from the realm of cars and toasters, acknowledging finally that health care should not be a business but a service to the society, like police, fire protection, roads, and schools. And Medicare for All will not be government run; it will be government funded, with all providers billing the HHS (the single payer) for their services, having more control over the quality of the care they provide than they do with private insurers dictating what they can and cannot do, based on their profit margins.
The problem is not with Medicare itself but with the way that Medicare has been infiltrated by for-profit health care, as seen most clearly in the 2003 changes to Medicare, resulting in Medicare Advantage programs and drug plans under the control of the pharmaceutical industry.
Take a look at the study commissioned by the California Nurses Association (http://www.calnurse.org/) to see how self-sustaining single payer will be and how it will benefit the economy. You would do well to do some real research on the subject, rather than rely on what the WSJ reports second- or third-hand.
#2 MikeN
on May 14, 2009 at 12:59 p.m.(UW Campus | UW Community)
Healthcare wouldn't work in a laissez faire market system because there are no substitutes. If I think the existing line-up of vehicles are too expensive, I can forgo buying a car and ride a bike. If I have a heart attack, I can't forgo medical treatment (that is, of course, if I don't want to die).
The end result of a market-driven system of healthcare is insurers and doctors only covering the healthiest or wealthiest of society.
#3 Chris B.
on May 14, 2009 at 11:02 p.m.(Seattle, WA | UW Community)
You must at least acknowledge that there are about 45 million people excluded from health insurance currently. With a government agency, subsidies would provide these people with health services they have been so distanced from. This is why we see 70% of deaths in the US coming from preventable/screenable chronic diseases (heart disease, diabetes, many cancers).
The deficient medicare argument doesn't hold much water - as it has only covered people over 65 and/or with disability. These individuals have participated in our unanticipated broken health care system that is purely commodified. They are also aging. Thus costs are sky-high for such a program.
All I am saying is that you should consider the health of Americans in your argument against expanding health care.
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