Thursday, January 21, 2010

Health Care Reform

I read this piece by Jamelle arguing that the Republicans have no interest in health care reform, and also this follow-up by Mark Thompson that says, of course, Republicans aren't going to support a liberal bill. Mark makes a good point here:
Democrats have been insisting that that our health care system’s problems are caused by A and B and that the way to solve those problems is with some negotiable degree of X and Y. But Republicans, to the extent they are willing to acknowledge the problem at all, are insistent that those problems are caused or exacerbated by the levels of X and Y that are already in the system, or that adding X and Y will only create new problems without solving old ones. If that is true, then under no circumstance will you ever get a Republican to go along with a policy that uses X and Y as its principle mechanism, even if you minimize the amount of X and Y used. But that’s a far cry from saying that all Republicans will be unwilling to agree to something that relies on any one of mechanisms C-W, even if this is true of many or most Republicans.

What gets lost in all this discussion about health care is what is actually driving it. For the Democrats, there are two things: 1) the idea that everybody ought to have health insurance because health care is a human right, and 2) the cost of existing public health care costs are projected, like a boa constrictor, to squeeze the federal budget and then devour it whole.

The first reason has been debated at great length, and I'm going to leave it alone.

The second point has largely revolved around the accuracy and effectiveness of CBO scoring. Politically, this has largely resulted in two approaches. The Ezra Klein approach -- Ignore cost. Just get the benefit in place after which the public will so love it and the Democrats who gave it to them that they'll accept rational cost cutting measures. I think that's fucking asinine and totally unrealistic. The second approach is the called, Chose a politically acceptable CBO score and then game it even though everybody with half a brain knows it's complete bullshit accounting tricks.

What all of this analysis misses is one crucial point -- Republicans want the government to do less and Democrats want the government to do more. More now and presumably more in the future. Democrats look at the numbers and see a world in which the government can't even do what it's doing now. Therefore, a large part of the motivation for many Democrats is, I believe, not covering people, but make sure that the programs created previously don't prevent them from doing more given an American electorate that is largely tax-phobic. (And even if they weren't the amount taxes would need to rise to cover the cost of existing programs is still probably problematic.) But being Democrats they need to put some sort of feel-good and idealistic coating on their agenda. So, the age-old Democratic goal of covering more people gets front billing. Nevertheless, the real goal, deep down, isn't to save families money, but to ensure the ability of resources for government to do more in the future. Being Democrats, their base's solution and their leadership's proclivity is to solve the problem with more government programs. Better ones. By better, they mean more efficient. By more efficient, they mean economies of scale. By economies of scale, they mean single payer insurance.

Many Democrats think the Republican obstructionism is part of a tactic to undermine Obama. It is, but like good liberals their analytical time horizons are too short. Republicans look at this and see a legacy of Democratic enacted entitlements (Medicare, Medicaid, Social Security, etc) that they, and anybody with a calculator, always knew weren't indefinite sustainable. (Sure, health care costs have shot up more than people expected, but it's reasonable that health care costs would outpace inflation as a nation grows wealthier.) Anyway, the Republicans see the government budget on a collision course with the abyss that is a result of Democratic policies. By delaying they're starving the beast and they're betting that when the public stares into that abyss, in a decade or two, it will undermine not just the all Democrats in power who couldn't reform health care, but their entire liberal-democratic-technocratic project and ideology. In short, the Republicans are not stalling only to undermine Obama, but FTW.

Actually, I'm hoping I'm wrong on both counts because each of them scares the shit out of me.


rahowe said...

I have two charts hanging over my desk. One from the wildly liberal Heritage Foundation shows federal revenue and outlays from my birth until 2006. The other, from a Sebastian Mallaby essay in The Washington Post back in December 2008, shows combined local, state and federal expenditures as a percentage of gross domestic product from 1947 through September 2008.

I cannot look at these charts and support assertions that the Republicans are fiscally responsible or that they actually reduce the size of government. The Medicare prescription drug benefit, for example, was a bit of unpaid-for Republican government largess that has been followed by vehement Republican defenses of grandma's Medicare over the past several months. They are against Democratic efforts to reduce the cost of Medicare.

We have had Republican presidents for twenty of the past twenty-nine years. Either, the government is a small as Republicans intend to make it, or they simply will not make it smaller. Given their proclivity for budget deficits, and the Democratic years of budget surplus and the CBO score of the health care reform bill (a demonstration of Democratic intentions to be fiscally responsible), I think we ought to be on our guard against Republican presidencies.

I suspect you are right; rather than reduce government or at least attack deficits and debt, the Republicans are unflinchingly willing to crash the government and then hope for something good to come out of it. Hard to locate a historical precedent that makes that a reassuring course. Most bankrupt empires seem to disappear.

FLG said...

1) You are arguing against something that I never wrote. The words fiscally responsible never appear in my post. Indeed, I'm arguing that they are being irresponsible in trying to Starve the Beast.

2) "We have had Republican presidents for twenty of the past twenty-nine years. Either, the government is a small as Republicans intend to make it, or they simply will not make it smaller."

Presidents can't change the size of government all on their own. They need congress too.

3) You attack the Republicans, but give the Democrats a pass. It ain't like they are lighting up the world with good ideas or even good execution of bad ideas.

4) In a sense, Republicans don't have to be as fiscally responsible in the short run because they want the government to do less. Democrats, if they want the government to do more, need to find ways to make the resources available because it don't look pretty for their plans moving forward. And I'm not just talking about health care, but all entitlements.

Andrew Stevens said...

Most bankrupt empires seem to disappear.

Probably not true. There's a selection bias going on. If an empire goes bankrupt and recovers, nobody bothers to remember the bankruptcy. The Roman Empire must have gone bankrupt dozens of times over the centuries before it fell and bankruptcy likely didn't have much to do with its fall.

rahowe said...

Come now! You both appear to be offering silliness in pursuit of belligerence.

FLG, I am supportive of your contention the Republicans are pushing us toward an abyss although I do not believe they do so purposefully. Comments on fiscal irresponsibility support that position.

Yes, Congress plays a role, but President's write the budget, and years of a Republican in the White House and Republican majorities in both houses of Congress--very recent years--should have done a great deal to reduce the size of government IF that was their intention. (It also should have greatly restricted abortion IF that was their intention.) A Democrat in the White House wrote four budgets with a surplus and realized those surpluses for us. That is simply a historical fact that no recent Republican president can brag about--quite the contrary.

And yes, ALL governments, led by any party, have a responsibility to be fiscally responsible. For me, that includes deficit spending in recessions if adequate savings are not at hand, followed by a quick return to surplus and elimination of the acquired debt. A health-reform package like this one that promises $130B in deficit reduction over the next ten years and $130B per year after that would win my vote even if it did not provide coverage for a single additional American. That this bill covers another 31 million Americans is gravy.

Andrew, are you suggesting a survey of bankrupt empires would reveal that my claim "most" had disappeared is erroneous? At best, we have one empire today although we resist that appellation. ALL the others, bankrupt and otherwise, are gone. I think I made a rather safe and correct assertion, but I am intrigued already by your list of successful bankrupt empires. I regret that you provided only one example that even you consider questionable.

Andrew Stevens said...

Ah, if you want to rephrase your sentence to "most empires seem to disappear" then I would find it as unobjectionable as "most people seem to die." I do object to your sentence for the same reason that I'd object to the sentence "most ill people seem to die." This is true because people will die in any event. But most illnesses don't kill people.

rahowe said...

I would prefer to read your list of bankrupt empires that continued on without dramatic shrinkage or outright collapse.

FLG said...

Cold water causes shrinkage, not bankruptcy.

Andrew Stevens said...

The British Empire was bankrupt after the Seven Years' War, thus the imposition of taxes on the American colonies, eventually leading to revolt. However, the British Empire would hit its height at least a century later. Like the Romans, the British too had many, many periods when they ran out of money and had to drum up more revenues.

The Soviet Empire began in bankruptcy, repudiating all Tsarist debts and this made it impossible for them to borrow internationally until the 1970s. This did not stop them from becoming a world power.

If by "bankruptcy," you define it as an economic catastrophe from which one never recovers, then obviously all empires end up bankrupt and bankruptcy ends them all, but the point is no longer interesting. Barring invasion, natural disaster, massive foreign adventures, or something similar, it's hard to imagine how this happens to the U.S. The collapse of the financing of the government won't materially change the U.S.'s wealth. And that's the key to genuine economic collapse - not something that affects merely the wealth of the government, but an event which diminishes the wealth of the nation.

rahowe said...

I am not sure I can buy into the idea that wealth in private hands guarantees the survival of a nation with a bankrupt government. And, I assume you would not argue that financially secure governments are not better able to preserve themselves and their reach than governments that cannot pay their bills. China is "rising" in large measure because of its public wealth, right? British debt resulted in the loss of the American colonies. If the crown had adequate resources, it could have chosen to continue the fight. George III did not suddenly decide he no longer wanted an empire, and our battlefield success were not debilitating. The difference in prospects for financially stable and bankrupt empires seems clear to me.

I expect that a government bankruptcy here will lead to a dramatic scaling back of our foreign military interventions and assistance and our international aid and other "soft powers." Should that happen, our "empire" will be dramatically reduced or eliminated regardless of the wealth in private hands UNLESS we decide to seize that wealth to preserve our government and the influence we have in the world through our government functions. I prefer to avoid that undemocratic result by avoiding a government financing disaster. What would come of the Texas and Alaska independence movements if we went bankrupt? Will wealth in the private hands of Texans preserve the union? I am skeptical.

Andrew Stevens said...

I appear to have given you the impression that I was engaging with the argument in your first comment and I regret the impression. I was simply being pedantic about a small fraction of it; I certainly wasn't arguing that the U.S. government ought to go bankrupt. (Then again, I also certainly don't believe that this is anyone's strategy.) We can all agree, I think, that ceteris paribus it's better if the U.S. government doesn't go bankrupt. I was simply arguing that, if it did, this is probably not disastrous. The U.S. government could still do business by raising taxes, cutting spending, or both in order to make ends meet. When we think of "bankrupt empires" like the Ottomans after World War I or the British after World War II, we are thinking of very different conditions (usually war-related) than a mere temporary mismatch in revenues and expenses which happens to lots of countries without destroying them. (Granted it happens to empires as mighty as the American empire with much less regularity.)

I take your point about the possibility of a tax revolt within the United States, in the event of its having to raise emergency revenues, and I can't say this possibility doesn't exist, though I don't think it's likely.

The British did lose the American colonies, but they nevertheless went on to higher and higher heights over the next century. Their bankruptcy was a temporary problem, relatively easily fixed. Would they have been better off had they avoided it? You bet. But even when they did go irredeemably bankrupt and lost their Empire, it was hardly the end of the world as they know it for the British. The only major difference between the British before World War II and after, for a British subject living in Britain, is that now the American taxpayers foot a large portion of the bill for their defense (and perhaps a loss of national prestige, which is something of an intangible benefit).

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