There are a lot of answers to this. The first is to point out, as The Economist ably does, that the reports of the end of the honeymoon have been greatly exaggerated.
But two things are also clear: the Democrats overestimated the boost they'd get from both the crisis and Obama's popularity. And they dissipated a hell of a lot of the money and political capital they'd now like to spend on the stimulus and the GM bailout. They got very carried away with visions of 1932.
But this is not 1932, and Obama is not FDR. FDR came into office with 20+% unemployment and a banking crisis that was wiping out peoples' life savings every day. FDR also came into office with a trivial national debt, and a Federal government that consumed less than 4% of GDP. He had a lot of run room.
Maybe more importantly, he came into office without the kinds of institutional arrangements that made it politically difficult to pass his policies. There are a lot of these, but some highlights:
- There was no institution like the CBO to model the impact of his programs, and implacably report that they were going to cost huge amounts of money
- There was no vast fraternity of tax lawyers to help blunt the revenue enhancements from new taxes
- Discipline in the Senate and the House was much stronger
- Corporate lobbying was relatively weak, and interest group lobbying was in its infancy
- There was no existing infrastructure of programs with constituents fighting change
Jonathan Rauch's book, Government's End, is one of the best popular books on the political process I've ever read. It outlines precisely this problem: the longer your government has been around, the less room there is for changing the government. For decades, there have been a lot of theories about how various politicians were going to overcome this glacial inertia. Clinton thought he had an overwhelming mandate for health care reform. The Contract with America folks thought they had an overwhelming mandate to shrink government. The Bush team thought that 9/11 had created a permanent Republican majority. What's astonishing, in retrospect, is how little any of them really changed.
Many Democrats thought this time was different, and I confess, so did I: Obama was popular, the war was not, the financial crisis offered cover and rationale for sweeping change. And maybe it still will be. But part of the problem is that if all that stimulus money works, it will rob not only the funds, but the sense of crisis, he needs to make really substantive change in the face of a loss-averse electorate.
Martin Wolf has argued that we are tracking the path of the Great Depression, but we are not quite there yet.It may well be that Mr. Obama turns out to be Herbert Hoover,rather than FDR. After all, it was Hoover who wanted to stimulate the economy and created the Reconstruction Finance Corp,an early version of TARP. FDR ran to the right of Hoover on the economic downturn and his first Budget Director thought that his job would be to cut spending and taxes.
"But part of the problem is that if all that stimulus money works, it will rob not only the funds, but the sense of crisis, he needs to make really substantive change in the face of a loss-averse electorate."
Every president in my life-time has needed to make substantive change to previous programs and existing social institutions. Medicare has been screwed up for 20 years....I mean publicly known to be screwed up. Social Security has been known to be rapidly approaching the point of no return for at least 10 years and probably alot longer.
Obama was never really bringing anything new to the table. He campaigned on Hope and Change, but he had no examples from his career. His promises were all grandiose; normal for politicians aspiring to higher office. And his time in office so far has been very prominently partisan, defensive when attacked, blame-oriented, and focused on pleasing special interests that are seen to be needed in the future.
Within this framework, even without the vast stimulus measures taken and the economic crisis, I see no premise on which he was going to make "substantive changes" in a long-term positive manner. Almost all of their efforts thus far have been focused on ultra-short term party benefit, rather than even mid-term or long-term national benefit.
This is true of many presidents, absolutely, but I don't understand why people are so surprised. I'd be MORE surprised if he had spent his political capital on something that no one liked in the short term but was truly good for the country in the long-term (i.e. massive tax code reform, massive social security reform).
Just my .02
Oh please. Yes, change is hard, but Obama DOESN'T WANT sweeping change.
He's an awesome speaker and could be a great leader, but he doesn't actually WANT to lead anybody anywhere dramatic.
He was a Washington/Establishment guy BEFORE he was elected. He voted for Bush's FISA bill (for executive power and sheltering the corporations) for example.
Of course DADT is still in place, mortgage law hasn't changed, etc etc etc. Principles are required to motivate radical change and I do not think Obama is overly burdened with principles.
That's why I think the right's Obama-socialist vapors are ridiculous.
In the last presidential election in France, it said that the French people didn't really want change, but rather, the appearance of change, and that Sarkozy was giving them exactly that.
I wonder if the same thing might be true here.
Megan, I like you, I respect you, but every time you have a choice to make between being constructive and grinding an axe against liberals, you choose the latter; and while I believe you have a self-critical process, for some reason, you don't seem to engage with it here on your blog. And I also think that you are too eager to please your commenters, many of whom are flatly despicable people.
If there is no change to our horrid system, that is a victory for no one, but it's a tremendous loss for the very, very many people who are suffering and need help. Now your commenters will pop up to ridicule me, Rob Lyman will sit around for twenty minutes trying to come up with some acid put down, and you'll probably wave your hand and shoo away claims about suffering. That's not an insult to you; that's the straightjacket that your ideology represents. But this is a fact: in a country with embarrassing levels of affluence and wealth, people will be left in immeasurable pain because of our system, people will be left destitute because of our system, and people will die because of our system. And no amount of snark, of derision, of the politics of petty grievance, of reverse sanctimony, of all the great mass of intransigence and pushback, can change that fact. Everyone has one role or the other to play: you are either working to help those people or you aren't. Your commenters have health insurance. We know what will please them. The question is whether there's any time when you, or anyone else who oppose health care reform, takes on the mantle of moral responsibility and works for change. That is the question, and it remains.
"The question is whether there's any time when you, or anyone else who oppose health care reform, takes on the mantle of moral responsibility and works for change. That is the question, and it remains"
Freddie - I find your post interesting on a number of levels, and I want to engage it directly. But first, I find it incredibly hypocritical that you paint with a broad brush those that disagree as despicable and prone to "shooing" claims about suffering, whilst then saying that they aren't taking up the mantle of moral responsibility.
Let me pose some questions to you which I don't think you have considered:
1. If your actions today will make 20 million people die 5 years earlier, but will allow 10 million people to live 10 years longer every generation after the current, is this morally repugnant?
2. If your actions are focused not on temporarily curing an ailment but on fixing the source of the problem whilst the patient suffers, is that wrong?
I ask these questions because that is what I'm focused on. Long-term improvement even at the expense of any short term improvement.
Does that make me morally repugnant?
Freddie, any system will have people die who might not die until much later under a different system. There are not enough medical resources in this country to treat every person for every potential problem. This is an irrefutable fact, so your claim that keeping our current system is a victory for no one is false. You can point out the suffering of the uninsured in our system, but it's only useful if you can prove that there wouldn't be as many people suffering under your preferred alternate system and if everyone buys into utilitarian definitions of good.
This is what happens when people substitute universal healthcare for religion, and then start setting aside their opponents as being selfish tools who have no right to rational debate because, y'know, they're on the wrong side of God. "Despicable" and all that.
Ol' Fred Phelps would be proud of the path his namesake is treading down.
Part of my education, affecting my opinions, has been to note that Congress usually takes 20 years to reverse itself on anything. For a long time I thought elections should be able to hurry that up, but no, they don't seem to. Why? I think it is because everything Congress does creates an opportunity for some vested interest to build a nest. Reduced to an understanding of that essential part of human nature, nest-building, the realization is that any reform in policy must be taken slowly and incrementally to be successful. When a change in policy requires eliminating some nests, morality and sentimentality notwithstanding, the process involves creating a sense of inevitability and buying time to allow the nesters to move on. Understanding this is not necessarily cynical or callous. Some will point to our slow reforms as part of the wisdom of our system of government.
Rob Lyman will sit around for twenty minutes trying to come up with some acid put down
It never takes me that long to come up with a put-down.
in a country with embarrassing levels of affluence and wealth, people will be left in immeasurable pain because of our system, people will be left destitute because of our system, and people will die because of our system.
That is true in, well, every system. As has been pointed out to you over and over, every system involves tradeoffs. Perhaps our system currently makes the wrong tradeoffs. Perhaps you would prefer to give up some of what we have in exchange for something else. You are welcome to make that case, and I for one am open to it.
But you never, ever make it. You point to suffering and say it proves the need for change, but refuse to explain what change you would make, how it would heal the suffering that exists, and what new (but lesser!) suffering it would create.
Lots of people have made concrete suggestions. RW is adamant about cutting doctor salaries. I have suggested universal high-deductible catastrophic insurance. Others have forthrightly advocated rationing of expensive procedures for the elderly. Undoubtedly the single-payer advocates are around here somewhere. But nobody has any idea what you support, other than handwaving moral pathos. Why don't you tell us?
Rob,
I agree that we should try to make concrete proposals. What about means testing for the Part D prescription benefits?
Is it possible? Does it reduce costs in a significant way? Is it efficient?
Tim in Portland
Rob says "That is true in, well, every system."
Not the system that exists in glorious perfection inside Freddie's head!
Oh sure, you may say he's a dreamer but he's not the only one.
I just hope that someday, Rob, you'll stop with the put-downs and join us.
And the world can be as...
Obama very cleverly campaigned against change except in the abstract. His ads warned people that McCain 'wanted to take away their private health insurance by taxing it.' He also succeeded in frightening people with the idea that their extra expensive goodies in health care weren't going to be covered; his opponent was going to give a '$15,00 tax credit' for insurance and that perhaps implied a limit to free health expenses.
Exactly. McCain's proposal was a small step away from the idiocy of employer-provided health insurance, and was a major reason why I was able to hold my nose and vote for him. (Nuclear power being the other). But most voters will ruthlessly punish any candidate who implies in any way that health care is subject to the laws of economics.
People say that POTUS is governing Chicago Style,
as if that were a bad thing. :)
The old-time Big City Bosses were successful,
until they promised more favors to more people
than they could deliver.
The smarter ones had a tims set aside for listening
to complaints from whoever walked in the door of their office.
One of them was claimed to have said that he had only three
unbreakable rules:
1) Keep the streets well paved.
2) Keep your hands off the schools.
3) Never have anybody killed on the right side of the tracks.
The bottom line remains the same: The US is bankrupt, and will
suffer accordingly, unless it starts making and selling things
its creditors want to buy, at prices they can afford.
Plus point 3; We had best keep our sword sharp and shield up.
Boss Daley would have understood and accepted that, and
taken necessary action; Pray that his ghost pays Obama
a midnight visit.
I think people are open to reform. The problem is that the democratic party will not let there be any reform unless it is comprehensive, meaning the government gets way more power over people. It would also help if the republicans would get off their tails (either when in power or not) and offer their ideas. Scratch that, it would help if the republicans had ideas.
Most people have insurance. Most people like their insurance. That is some significant inertia to fight. I would encourage anyone in power to not fight against it, make changes that compliment the existing system. They can still be big changes.
It seems to me that the problem of healthcare is multi-faceted but the biggest problem, imho, is the LACK of free market solutions. Heck there is a lack of even free market thought on healthcare. Here’s a quiz: If are not poor and you break your arm because you fell off your ladder, who should have to pay for that treatment? If your answer is that you should pay for it, then you understand the free market. If your answer was that someone else should pay for it, welcome to the current system!
Doctor's ought to be able to advertise their office rates. I think the AMA prohibits this. Doctor's ought to be able to advertise the average time between your appointment time and actually being seen by the doctor. Have them advertise their rate system, $75 gets you seen today, $125 paid up front means you are the next patient the doctor sees. Some doctors will have $500 office visits, I bet they have the nicest waiting rooms and great coffee (free even!) for their patients.
Give tax breaks to doctors that work at free clinics.
Non-physicians should be able to treat patients, think Nurses that can prescribe basic meds. They too should be allowed to advertise rates.
If you have a non-emergent procedure, you should be able to call different hospitals and get cost information. For example, if your physician says you need to have your gall bladder removed you should be able to call as many hospitals as you want and ask for (and receive) the average cost, infection rate, complication rate, and mortality of that procedure done that that location.
Filing insurance on your behalf should be illegal. You have to get the bill, file your own insurance, and pay the hosptial. For office visits you should pay for it and file to be reimbursed. All of a sudden people will want to shop around for the best rate to be seen by a doctor, and they will want to call hospitals to find out how much procedures cost.
Incentives should be created so that health insurance really is insurance. Right now people treat health insurance this way: Let's say I have beer insurance every time I want beer I expect to go the grocery and pay a $10 co-pay and take home a keg, I don't understand why the beer industry is in financial straits. See the above quiz.
Car insurance is mandated by law, it is cheap, plentiful, and easy to obtain. That's because when it comes time to use it you must have a need that exceeds a dollar threshold. If you really want to set up universal care, then set a threshold say $65000 a year, if you have a need for a procedure (or procedures) that cost more than that, then you are universally covered. This means heart surgeries, cancer treatments, transplants, etc. Ration it, make the rationing rules known to all. Require oversight and multiple Inspecotrs General to make sure the connected do not get more than non-connected individuals. Index the (payment) number to medical inflation. Allow people to purchase plans to suppliment procedures/treatments. If you were to do this then the actuarial tables would adjust and the cost of a medical insurance policy would come down mightily.
While you are at it, make the necessary tort reform to make medical malpractice insurance cost less. I am not taking a stance here on what should be done, merely that the lawyer's lobby needs to be made to heel on this one.
All this, imho.
The taxation or removal of the deduction on the business side for insurance beyond $15,000 (cf. my comment of 2:12) strikes me as a reasonable change. A good insurance plan is probably in the neighborhood of that cost so I assume it wouldn't much affect most people. The AMA doesn't prohibit advertising of rates. Rates for LASIK are advertised all the time in Dallas.
Somebody asked about the cost of a childbirth posts back. India is showing some capitalistic action in their health care market. A condom manufacturer added a new health care division which is obstetrical hospitals. You can get a complete childbirth for $3000 rupees per a recent article in FT. I was telling this to an Indian friend who said, '50 rupees is only a dollar;' so the childbirth cost is $60. There had not been any maternal mortality in these hospitals which is a substantial improvement for the population served.
Michael,
I will agree with your post to a certain extent. As soon as the cost of the average plan starts to creep up past the $15000/yr mark you will get some grumbling from the people bringing home less pay.
Taxing benefits beyond a threshold should be on the table for discussion.
I would rather see that all of the employer provided income be listed in full as pretax. So, the employer portion of social security and medicare, and things like the total amount the employer pays for you health (and other) insurace is listed as part of gross wages.
Further if I could only pass one law it would be to eliminate the withholding. Give me the gross wages and then give me a monthly bill (just like my car insurance).
Actually give the people the money and them make them give it up. As soon as you do I think they would be much more conscious of where tax dollars (and health insurance dollars) are going.
all this, imho.
Is it possible? Does it reduce costs in a significant way? Is it efficient?
I don't know, it doesn't reduce costs, it just changes who pays them, and I don't know.
I'd be in favor of means testing most everything related to oldsters, but in the end, it won't make a difference in health care costs unless we start rationing publicly funded end-of-life care. Very few people can save enough over their lifetimes to pay for all of their geriatric medical expenses, so means testing will simply force everyone into penury before Medicare kicks in, and then the big bills will still remain.
In Freddie's mind, merely pointing out tradeoffs -- that things have costs, that TANSTAAFL -- is the same as moral cowardice and "snark."
Nimed and RW routinely offer extremely thoughtful and evidence-based arguments that diverge from the cartoonish let-people-die caricature that Freddie likes to imagine is the libertarian position. They challenge me and make me think and reconsider my own assumptions.
But the way Freddie approaches the issue reminds me of my own thought process when I was in high school and college. If only people would be nicer to each other! Then there would be no war. And if only people would agree to work for free! Then we could have free heathcare for everybody. (BTW, how is this different from slavery?)
I remember how frustrating it was when some "realist" refused to nurture such infantile and mushy reasoning. When they pointed out tradeoffs and costs, they were doing more than just engaging in policy discussion. They were harshing your buzz. It's why, when you've eaten mushrooms, you can't be around somebody who isn't tripping. People who point out costs are refusing to engage in the fantasy, thereby exposing its silliness. And that is a really unpleasant moment, akin to when you're chillin' in a great mood on a great high with good reggae on the iPod and somebody barges in, flips the lights on, turns off the music, and says that the landlord has arrived and wants to see you. Talk about buzzkill!
Freddie's emotional outbursts should not be understood as any deeper or substantial than that -- as the angry reaction of a kid whose mellow has been cruelly harshed by reality. And, as I've mentioned before, I say this as somebody who, while living abroad, has experienced the pros and cons of universal healthcare, and who is very open to such schemes here. But I value intellectual honesty (and maturity) as well, which is why RW and Nimed are far more persuasive and intriguing to me than Freddie, even when I disagree with them strongly. I come to this blog because the discussions, on average, are far more substantial than you find elsewhere, and the echo chamber is, if not absent, at least a bit smaller.
(By the way, how un-self-aware do you have to be to, in the same sentence, both accuse Megan of "grinding an axe against liberals" instead of being constructive, and then claim that many of her commenters -- whom I assume he has never met and knows nothing about how they treat their fellow humans in the real world where it counts -- are "flatly despicable people" ????)
OK, so I was grinding an axe in my last post rather than offer solutions. Maybe I will in a future post that is really about healthcare (this one is more about broken government).
As for solving THAT issue, I have no answers beyond moving to the woods. We think we have gotten beyond Ancien Regime, but one look at the tax code (take your time!) proves that our byzantine system of rents, special favors, and privileges would really impress the aristocrats of 17th-century France. Probably the solution is to provide more alternatives to law school for upper-middle-class humanities majors. There are few things as dangerous to the long-term health of a society than a glut of self-important, self-righteous lawyers chisling away endlessly at the traditions of trust, rule of law, republican virtue, property rights, and blind justice that underpin a prosperity and freedom.
Freddie:
I particularly dislike the way you poke the Christian charity reflex.
Government charity does not aquire merit either for the taxpayer, from whom the taxes are extracted by force, or from those who agitate or vote for such. Robin Hood is best left a folk hero of the past. In real life he makes everybody worse off.
Christian charity is all well and good, but let's not forget the other, lesser-known part of the Sermon of the Mount: Blessed are those that fund the social causes du jour with wealth forcibly extracted from other people and then call it "compassion."
Freddie doesn't understand how anyone can not be sympathetic to the 40 million uninsured.
We'll I'm not sympathetic to the 13 million who are already eligible for existing government programs but haven't gotten around to signing up. I'm also not sympathetic to 13 million who make enough to purchase their own insurance, but have chosen to spend their money on other things.
I think you've made it abundantly clear in these pages that you are not sympathetic to anyone but yourself, so we can just leave it at that.
Freddie, I assume you think it's at least theoretically possible for health care to change for the worse, even if the change results in fewer uninsured.
The simplest solution would be to pass a law that says that anyone who offers medical care must provide it to anyone who asks, and may not collect from anyone under four times the poverty limit who does not have insurance. (Of course, they would also have to non-discriminate in care and in accepting new patients, but we can fix that by allowing the indigent to sue doctors for discrimination).
You might argue that my solution is unfair to doctors, that it will discourage investment in new medical resources, and that it will cause large numbers of the currently insured who earn less than four times the poverty limit to drop their coverage. But if you argue that, I will accuse you of not caring about the uninsured.
Unfortunately, we do not have Marie Antoinette to then say, "Let them go to chiropractors."
There is both an under-reported political reality and a tactical political mistake that will doom healthcare:
the political reality is that while the Dems have a large margin in the House, the margin was almost exclusively gained in districts that have Rep registration advantages and voted McCain in the last election. These Dem house members ran as deficit conservatives /social moderates -- think Heath Schuler in Va, or Harry Mitchell in Az. House members like this know that too many votes for big government / big spending is their ticket to retirement in 2010. Health care itself isnt so much the issue -- but the enormous price tag and/or the prospect of income taxes going up to fund it. Very unpopular in the districts they come from.
The tactical mistake Obama made is this: with big ticket (deficit wise) items that seem really central to his agenda like health care and climate change in the pipeline --- his administration's first acts opened the floodgates on spending on things that seem secondary to his agenda: the poorly crafted stimulus, a general spending bill with tons of earmarks and a 9% year on year increase in discretionary spending, GM and the like.
The secondary stuff right out the gate produced a sense of sticker shock with the general public. Had Obama said "no" early on to at least some of those things -- people might be more willing to add to the deficit for healthcare.
But instead, Obama made a speech about how "What do you think stimulus is? It's spending! We have to spend!"
That was, in my opinion, one of the most asinine speeches an executive-based politician has ever made. It's bad enough the guy rarely goes off-teleprompter and usually mumbles a non-commital statement when he does, but there comes a point where an intelligent person must realize that what he/she is saying is terribly off-base. Yet I've never seen that with Obama. I think he's just afraid to speak extemporaneously.
When Senator Dodd said he was "surprised" by the cost estimate CBO came back with, I was appalled. What does it say about a Senator on the HELP Committee that he gets "surprised" by the cost of legislation his fellow party member and fellow committee member has proposed? I could see someone in his first year in the Senate, or if it was some small piece of legislation, but this guy has been around for how long and this is probably the biggest piece of domestic legislation to come before him ever. He should just hold up a sign that says "Help me, I have no clue what I am doing with taxpayer money."
There was no institution like the CBO to model the impact of his programs, and implacably report that they were going to cost huge amounts of money
Interestingly, the CBO is reporting that extending the Bush tax cuts is going to cost huge amounts of money, yet hardly anyone is very exercised about this.
The more I hear the healthcare debate the more pissed off I get at McCain. His healthcare reform plan for all the utter crapiness of it was sort of incrementalist thing that might have gotten passed. It could have gone a bit towards breaking the relationship towards work and health care and it could have gone a bit towards changing health care companies back into health insurance companies.
But the guy couldn't sell his own plan.
Sir, have you no Affirmative Action (in old Victorian that would be 'shame')!
Do you want to live for ever?
Well, do you, punk?
Despite all the shrieking about how terrible our health care system is the fact still remains that upwards of 85-90% of Americans who have insurance are happy with their situation.
Another headwind that reformers run into are the bogus numbers used as regards folks who don't have insurance. The 40-50 million number casually thrown about as gospel is a lot smaller on inspection. The hardcore uninsured runs closer to 15-20 million--5% of the population. Once that calculation is made the marketplace is left with a simple equation. Do we turn over to the government, which has never had a successful program in its history, 15% of our GDP, ruin insurance for the 85/90%% that are happy, to service the 5% who don't have it, all that at a cost of trillions of dollars? For thirty years, campaign promises aside, the electorate has aways said no.
Can you blame them? Folks like Freddie try to guilt trip them when everyone knows that we already have universal coverage. By law all General hospitals have to administer to anyone that walks through the door. The immediate cost--standing on a long line.
Lord knows there are always many things to do but turning over health care to the government is way down the list.
If you want to end the problem of access to care in this country all you would have to do is allow physicians to write off care delivered to uninsured patients below X income level (whatever X you think means they can't afford private health insurance) at medicare rates.
Every physician in the country would be actively seeking at least 30% uninsured, low-income patients to zero out their taxable income. In other words providing charity care.
Today, in case some of you don't know, although I am not allowed to (nor would I in any case) turn away emergent cases (I'm a surgeon) but I am also not allowed to write-off these as business losses (there are some very minor exceptions for the nit-pickers but the requirements essentially cannot be met).
I liked the way Richard Fernandez put it: