Anyone who has dated a manic-depressive has heard some version of this argument. "I can barely make ends meet now, so I might as well use my tax refund check to buy a boat! After all, if I can't figure out a way to fix my budget, I'm going to go bankrupt anyway."
And anyone who has dated a manic-depressive knows where this ends.
I have no idea why anyone would think that there is no difference between going bankrupt now, and going bankrupt later, which is assuredly untrue. Bankruptcy is a really quite traumatic event with very far-reaching consequences, and you should always try to maximize the distance between it, and you.
I also have no idea why anyone would think that there is no difference between going bankrupt for a huge sum, and going bankrupt for a smaller amount. I mean, there's sometimes no difference for the debtor, but of course, there are a whole bunch of creditors who are also people, and who are not going to be paid back, some of whom may end up in bankruptcy themselves if you default. Since in this case, many of the creditors are the American people, I would think that even the most corporation-hating, bank-despising, littleguyophilic liberal would sort of worry about this.
If we pass this health care reform bill, a bunch of people are going to leave their employer health insurance under this plan for some subsidized plan--millions of them, according to the CBO. If the government goes bankrupt, millions of people will lose that subsidized coverage and be much worse off than if we'd done nothing.
And as any competent bankruptcy attorney could tell you, adding a powerful new creditor also makes it harder to "resolve" the bankruptcy--i.e., to figure out who isn't getting what they're promised. Which is to say, each new entitlement means that you have more interest groups to negotiate with, and also that our prior unsecured creditors--Social Security and Medicare recipients--will have to have their entitlements cut even deeper when the crisis comes. Since those people have structured their lives around the promises of the US government, this is no small thing.
Naturally this all assumes that the premise is actually true--that without deep cuts, bankruptcy is 100% inevitable, so that buying something new with our "refund check" (the tax increases and Medicare cuts) cannot make it any more likely that we declare bankruptcy.
This is wrong in several ways. First, bankruptcy is not inevitable; it is theoretically possible to raise taxes to cope with Medicare growth, though it would be extraordinarily painful to do so. In the face of fiscal crisis, it might also be possible to make Medicare cuts that we have otherwise been unable to stick with. But as any competent development economist will be happy to tell you, every dollar you add, or interest group you create, makes it less likely that this sort of resolution will happen.
Assuming that it is not actually 100% certain, this statement is obviously nonsense on stilts. Bankruptcy becomes much more likely, and more rapid, once we have used up the easiest source of funds we had to cope with our existing obligations. This is true whether those funds are refund checks, or politically difficult spending cuts.
Too, our new
Just as a possible bankrupt would be better off putting the cash in the bank than spending it on some new desire, we would be fiscally better off doing nothing, than we would in taking on a gargantuan new entitlement. Yet, most of the responses to those of us who worry about the fiscal effects have so far been about the same as you get from your favorite manic depressive: "But think how great it would be to have a BOAT!"
I had no idea that you used to date Ezra Klein.
http://voices.washingtonpost.com/ezra-klein/2009/11/will_the_medicare_commission_s.html
No, I used to date the guy who wanted the boat.
Tom Vu?
Damn girl, homie was joking. The guilty flee where none pursue...
The key difference between the Manic Depressive who wants a boat and a congress that insists on spending money that we don't have is the outcome.
The Manic ends up crying, or locked in his house, or drunk, or - in extremis - perpetrating a criminal act.
The nation ends up with a shattered economy, whole families living under bridges, food riots, and - in extremis - tanks in the street and/or the Weimar Republic.
What makes us so racist and elitist that we believe in perpetual US superiority (aka "exceptionalism")? What makes us believe that we are more intelligent in how we are applying "progressive taxation" and "progressive social programs" that we won't end up with another Brazil or Argentina? For they, most certainly, have progressive taxation and social programs... or at least they do on paper. In reality, once the money ran out, most of these things are rudimentary.
Funny how that works.
As reported in the NY Times yesterday, hardly a conservative tome, we are about to face an annual debt service of $0.5T, just at the federal level. Depending upon what state you live in, your individual burden might be yet higher.
Just to pay for what we jointly used many yesterdays ago. Just to pay for what "the greatest generation," and "the great society," and "the me generation," and all of the others took as compensation for their sacrifices.
With zero guilt, they have sold out the current children and saddled them with a debt that makes Jacob Marley's chains look light in comparison. Worse, in spending this money they solved none of the social problems that they nobly sought out to eradicate.
The poor are still poor - but now they are also bitter, and often angry, and feel entitled to ever more. The sick are still sick, but they now are entitled to health care that they could never afford, but demand that we as a group provide. Johnny not only still can't read, but he is arguably dumber than he was 40 years ago - facing a global economy where many of his Asian and European peers have passed him by, intellectually. Worse, many of his non-educated peers are more than happy to take his industrial work away from him, since where they live you can still be very happy on a wage 1/5th what Johnny demands.
Economic Freedom is not perfect. It *does* leave have-nots behind. But, historically, it has also generated enough largesse that the have-nots could be provided for, at least at a basic level.
By destroying our free markets and replacing them with "enlightened, progressive policies" we have butchered the goose that laid all of those golden eggs. Worse, we still tell ourselves that the eggs are still there - buried under all of the debt notes, perhaps - and that we can still provide not only basic services to the have-nots, but EXPANDED services to them.
We have choked the engine of income while simultaneously expanding our charitable outlays.
This isn't manic depression; it's economic psychosis.
And it ain'g gonna end well.
I want to stand and applaud.
You are so right, and you have stated it so well.
Well, as long as we are getting rid of "American exceptionalism", then why do we have to compare ourselves with places like Brazil or Argentina. These places (until very recently) were ruled by tin-pot dictators set on looting their countries for personal profit while throwing out whatever bread and circuses were necessary to keep the masses distracted for the time being.
However, there is another option. Places like France, Germany, and Britain have universal health care, steeply progressive taxation, and yet their budgets are not out of whack, nor are their societies on the verge of collapse.
So, who are you to say that we'll end up like Argentina, and not Germany?
Argentina actually has less debt, as a % of GDP, than the USA, France, or Germany. The reason for it is why I think we'll end up more like them than Germany: ability to borrow.
When Argentina most needed the money, nobody would lend it. Common sense told the lender "you'll either never see this money again." Ditto Brazil and a host of other countries. It is their bad credit that actually accounts for much of their issues. When your economy cannot be trusted, the cascade of bad stuff happens.
Argentina, Brazil, Mexico, etc. - look at those disasters, and realize "these all happened to economies that were carrying *far* less debt than the USA. Whatever solutions they came up with weren't hampered by having to pay an onerous debt service. Moreover, the impact of their failure, globally, was attenuated by the fact that other nations weren't overly exposed, since other nations hadn't lent them fatally high amounts of money."
Not so the USA. If we, like the Manic Depressive, default on our loans, the world takes it in the shorts. And if we choose, instead, to simply inflate our way out of it, the world again takes it in the shorts. And if we, instead, decide to save our way out of it, the world takes it in the shorts since the consumption engine that has fueled the whole globes economy just stops.
Bubbles just delay the inevitable, while making the payback worse.
We bought posterity on credit, and now have none to offer our own children. The world foolishly lent us the money, and now will have none to provide for their own children.
I don't see Germany or France coming out of this clean, either, btw. They, too, have debt ratios that are simply too high.
An individual can be upside down in credit for a very simple reason: there are other individuals who are flush with cash, and able to lend it. It's the wealth balance that matters. As long as more people have earned wealth than are borrowing it, things work.
Everybody can't be upside down at the same time.
China, Dubai, Singapore, etc. have nowhere near enough real wealth to cover the borrowing that the United States and other "developed" economies are doing.
And yet that is the Obama plan, no? I have 1.4 trillion data points that say that it is, with more coming for FY2010...
I drove the Boat;)) How come you are picking on Sailors?;))
Hey I was a sailor but Uncle Sam paid for my boat. And yes Submarines are boats not ships.
Bankruptcy won't happen. The inevitable solution to healthcare costs as typified by Medicare is allocating resources more intelligently than we do now. Perverse incentives now apply a HUGE percentage (something like 35% of dollars for 1% of the population) of resources toward the last few months of life. When you look at a simple metric like the difference between end-of-life costs in Oregon vs Florida, you'll see how improvements can be made. The fact that as a society we fail to act like rational adults in this arena is indicative of our immature emotions and politics. The Terry Schiavo Affair is only one such example.
Please keep theod1 off of my death panel.
What are you smoking? First, the Terry Schiavo case was extremely rare, obviously. No rational person would base decisions for the average life on what happens in a rare case.
Secondly, your logic is screwy. The reason we use most of our healthcare dollars on people who are dying is because they're the sickest. So another way of saying what you did is "Perverse incentives now apply a HUGE percentage of dollars for those who are sickest. Phrased that way -- the correct way -- it begins to see less "perverse" and more like plain common sense: most of our healthcare money goes to those who are really sick. Well, duh. Who'd expect differently?
Let us also bear in mind you're being disingenuous when you use the misleading phrase "last few months of life." Almost always we only know you were in the "last few months of life" after you die, in hindsight. Liberal control-freak fantasies aside, medicine is not good enough to predict with precision the life expectancy of anyone. People who seem to have mild disease can suddenly succumb, and those who seem doomed can rally and go on to live for years. When you use the phrase "last few months of life" you want to imply that this is a waste of money -- why pay $100,000 for the "last few months" of life? Well, part of the problem, bucko, is that at the time you have to make the decision to spend it or not, you don't know whether this is the "last few months," or just some really difficult months that, once you get over, will be followed by years and years. The proof of that is the simple fact that modern medicine is not futile. A significant fraction of the time, very expensive advanced medical care works, in that it delivers a significant amount of extra life to people. Alas, that fraction is not 100%. It may not even be 50%. But it ain't 0%, and unless it's 0% then in any situation that looks like you're in "the last few months of life" there is a decent chance that modern medicine can disprove that appearance.
Finally, at any one time the people who are very sick is obviously a small percentage of the population. At any specific time -- today at 3 PM Easter, for example -- the great majority of Americans are perfectly healthy, and zero healthcare dollars are being spent on them. Most of the healthcare money spent today will, indeed, be spent on that very small percentage of us who happen to be very sick today.
So you're other "observation," that OMFG most healthcare money is spent on a small percentage of people is another truism. Where else would it go, silly? Should we be spending it on people who are perfectly healthy today?
Now if you want to use an actual useful statistic, you might ask: how do we spend healthcare money on a per lifetime basis? That is, what's the dollar amount of healthcare Joe Average absorbs over his entire life? How does that compare to Jane Q over here, or Nancy P over there? You will of course find out that most of the healthcare money absorbed by any person is in the last stages of their lives, naturally. But since we all, sooner or later, end up in the last stage of our life, we all, sooner or later, find ourself in that small sliver of the population who is receiving huge amounts of expensive healthcare today.
>medicine is not good enough to predict with precision the life expectancy of anyone.
Yes but if government is deciding when the 'last few months' start, you will be dead by the end of it no matter what.
That is what he is talking about.
Maturely
Derek
If we were spending money to maximize health and lifespan and not based on the AARP voting block, I'd say; "take some of the money spent on 80 year olds and use it for improved neonatal care and education."
Yeah, if only NJ would increase the funding per student in Newark from $25,000 per student per year to $35,000 then everyone would have a longer, happier life.
Neonatal care?
The cause of our high infant-mortality rates is mothers who smoke, drink, and do drugs during pregnancy. (The factor that actually correlates most strongly is illegitimacy, but this appears to be a correlation between women having children out of wedlock and doing other dumb things.)
A few points: (1) The Terri Schiavo case was perhaps rare as a national event but not so rare as an issue facing families every day. It did become a political circus and cause celebre against rational, private, end-of-life issues and for extraordinary intervention by the Govt. Such political circuses only cloud the nation's ability to act more rationally. Even Tom DeLay let his brain-damaged father pass away peacefully some years before he participated as head-clown in that circus : http://www.slate.com/id/2115879/
(2) There are lots of arenas in which healthcare dollars can be spent (oft times on the healthy) beyond extraordinary intervention to extend breathing for a few more months: vaccination, prevention, education, research, etc.
(3) Assisted suicide isn't the point; that's not statistically significant. Oregon has a robust hospice-care system. Florida has a robust hospital system. The perverse incentives in the latter are to operate that system to the max. The profit motive has its social costs and doesn't necessarily lead to better outcomes. Dr. Atul Gawande explicates this well in his New Yorker piece "The Cost Conundrum," 6/1/09.
Agree with almost everything you said, but I honestly don't believe that rationing will become as much of an issue as something you shrugged off (probably unintentionally):
"unless it's 0% then in any situation that looks like you're in "the last few months of life" there is a decent chance that modern medicine can disprove that appearance."
This is, in fact, the place where my generation will get the shaft, even if we survive The Bankruptcy. If you have, say a 0.1% chance, or even a 20% chance of survival, it becomes easy to pull the plug for the Greater Good. But this is the place where medical innovation is supposed to happen. This is also the obvious first place the government will cut, and there will be very little outcry in opposition.
I won't claim to know anything about what's driving end-of-life costs in Oregon vs Florida, but Oregon was the home of the lady offered suicide drugs in lieu of cancer treatment several years ago. Just saying!
Assisted suicide isn't the point. That's not statistically significant. Oregon has a robust hospice-care system. Florida has a robust hospital system. The perverse incentives in the latter are to operate that system to the max. The profit motive has its social costs and doesn't necessarily lead to better outcomes. Dr. Atul Gawande explicates this well in his New Yorker piece "The Cost Conundrum," 6/1/09. Read it and learn.
When you look at a simple metric like the difference between end-of-life costs in Oregon vs Florida, you'll see how improvements can be made.
I readily grant that it costs less to refuse medical treatment and replace it with "assisted suicide" by statute. You have, inadvertently or otherwise, laid out the differences between government controlled healthcare and a private system. Whether it is an improvement depends on your point of view.
It has just occurred to me, though, that there is another cost to this. In what this country has been up to now, people have always been self-motivated to achieve, to try their best; and in the process produce the surplus above subsistence that makes a society prosperous. In the brave new world to come; how much incentive will there be for an individual to strive to be a good Stakhanovite, slaving away for the good of the State, having the fruits of one's labor taxed away for the benefit of everybody else, and knowing that as soon as your existence becomes inconvenient to the State that they will take the first opportunity to kill you?
I admit to a bit of overstatement, but seriously what does it do to a culture and society when you know that at the end of your life you will be killed off by the State that claims your loyalty [and the majority of the fruits of your labor throughout your life via taxes] as soon as you are no longer useful? There is no rational way that there is going to be either more care, or quality care, when you cut the rates of reimbursement for caregivers and at the same time expand the demands on the system. And there will be fewer caregivers.
The terms of the bills passed, at least those which have escaped to the public, explicitly state that there are going to be monetary limits on the amount of care given. Rationing, by bureaucrat and eventually by politician, is inevitable. You can be sure that like in Canada, in Britain, and yes, in the old Soviet Union; the Nomenklatura will routinely receive levels of care denied to the bulk of the citizenry. After all, some animals are more equal than others.
Every state that has tried a form of government controlled health care has found it to be a financial disaster. Massachussetts, Tennessee, and Oregon have found that they cannot afford to give quality care to everyone; and have resorted to both tax increases and rationing of care. And the systems are failing.
For at least a generation, people are going to remember when it was possible to get what even now are considered to be medical miracles, affordably. I've seen three in my family in the last two years, all paid for by private insurance. And our family has seen the, and I use the term advisedly as a retired Peace Officer, murderous care in Britain in the NHS. They are going to see their quality and quantity of care decline. They themselves, and their families, are going to suffer from it at the same time they have to pay a crushing tax burden to pay for the system [and the way we are going to pay for a whole host of other intrusive government programs too].
When you know that no matter what you do, you are going to die at the hands of the state, not because of what you have done, not because of what you deserve, but because it is cheaper for the government; when you know that it would be possible to live longer with a better quality of life ..... it changes the relationship between the individual and both the state and the society that supports it. When you know that the ones making the decisions will get that longer life and better life at the expense of your death it cuts the ties that bind a people together.
Limiting treatments and encouraging death may make financial sense if you aspire to being a faceless bureaucrat making the decisions, or expect to be exempt from the decisions. But medical care is part of the care of the entire person. And that includes emotion. It includes a reverence for life. And that reverence and value for human life is what seems to be entirely missing from the American Left.
Subotai Bahadur
Subotai: I certainly hope so. We already have rationing. We arrange it so 20-30% or so (if you count the underinsured and not just the uninsured) of the population under-consumes health care resources, thereby allowing the rest to over-consume -- some times to a staggering degree. If we're going to have rationing, let it be rational. Moreover, this being the US of A, you'll always be able to go off grid and spend your own money on as much health care as your heart desires (hell, even in Socialist England that let you do that). It's just that some day you might not be able to spend society's or your employer's or the taxpayers' money without limits.
Really? It looks to me like Germany or Switzerland are the more plausible models. But sure, I understand England and Minsk are much better for your purposes, sounding much more scarily socialist then the homes of Mercedes Benz and Rolex.
The politicians have arranged it so that many people cannot afford insurance by 1) giving companies and not individuals tax incentives to buy insurance and 2) ridiculous regulations that force companies to cover too many procedures and limit their ability to charge customers for what they use. These are the same politicians you think can be trusted making the health care decisions. The same politicians that are going to send $300 million to Louisiana to bribe a senator into voting for the health care bill.
Rationing of health care should be done in the same way we ration everything else. Let consumers choose how much to spend on what health care they want. Market failures (people not being able to afford adequate health care or insurance) should be corrected through subsidies.
this being the US of A
Not buying. Back in 1913, the difference between [Tzarist] Russia and the US of A wasn't all that pronounced. Just give y'all time...
It looks to me like Germany or Switzerland are the more plausible models
The Eastern Germany...
We already have rationing. We arrange it so
You and me does not make a we [, Buster]
Uh, Max, you do realize Tzar is the russian word for king, right? As in monarchy...
I understand England and Minsk are much better for your purposes, sounding much more scarily socialist then the homes of Mercedes Benz and Rolex.
How about the homes of Rolls-Royce and Research in Motion? Neither is a communist dictatorship, but both have exactly the sort of healthcare system he's warning of.
Not buying. Back in 1913, the difference between [Tzarist] Russia and the US of A wasn't all that pronounced. Just give y'all time...
What are you talking about? That doesn't make any sense whatsoever.
You fail to acknowledge the de facto rationing that now occurs with a massive amount of uninsured who fall between the cracks of the "system" in place. In addition you fail to acknowledge the de facto rationing that now occurs through private sector insurance policies through denial of coverage and policies of pre-existing conditions. Please apply some of your rancor toward future, as-yet-to-be-determined Govt policies to the current system. That is the path to progress.
(1) The Terri Schiavo case was perhaps rare as a national event but not so rare as an issue facing families every day. It did become a political circus and cause celebre against rational, private, end-of-life issues and for extraordinary intervention by the Govt. Such political circuses only cloud the nation's ability to act more rationally. Even Tom DeLay let his brain-damaged father pass away peacefully some years before he participated as head-clown in that circus : http://www.slate.com/id/2115879/
(2) Assisted suicide isn't the point. That's not statistically significant. Oregon has a robust hospice-care system. Florida has a robust hospital system. The perverse incentives in the latter are to operate that system to the max. The profit motive has its social costs and doesn't necessarily lead to better outcomes. Dr. Atul Gawande explicates this well in his New Yorker piece "The Cost Conundrum," 6/1/09. Read it and learn.
Someone call Governor Palin.
That makes two people so far for Trig Palin's Death Panel: theod1 and Andrew Sullivan.
Someone call Ann Althouse and see if she's game.
It's also an equally good argument for keeping the current system. We'll have to spend less eventually so why bother changing things now.
I would prefer to pick the amount that I spend on health care rather than having some government agency pick for me.
You have less choice than you think. A wide variety of factors and entities determine the actual cost of your present day healthcare, and how you'll spend it, including doctors, drug makers, hospitals, insurance providers, employers, and of course the unpredictability of being sick, which always comes when you least want it, and can least afford it. Unless you're not covered by insurance, you essentially pay whatever they tell you to pay, and not a million dollars less.
The price of pencils is determined by many factors: the price of wood, the cost of shipping, the price of lead, availability of rubber. We don't need a government agency to properly price pencils.
Absent the most distorting of the current healthcare regulations, prices for more common procedures likely would come down to market clearing levels.
You're absolutely right Bill.
Once Healhcare is rationalized by government we need to move on to the major issue for most all Americans.
Housing.
Houses in my area average $600,000 - thats 10 times the average yearly wage for a family. No one can afford this!!!!
What kind of rich society leaves a majority of its population homeless?
Since Medical Care is a right, then Housing is even more so. You need a roof over your head every night.
And like Medical Care, Every American is entitled to the BEST housing that is Available.
I mean how ridiculous is it that rich people have better Housing options than me.
Not only that think how much more people like me can consume, thereby contrubuting to the economy when we finally have FREE HOUSING.
We've had to wait 50 years for our free HC, lets get FH done Now.
"Medicare will bankrupt America anyway if we can't cut health care costs, so we might as well do health care reform.
If that were the argument, it would be reckless. But that's not the argument people like Ezra are actually making. The argument is: "Medicare will bankrupt America if we can't cut health care costs, so let's try to do health care reform, which might actually bend the cost curve."
There are still plenty of arguments against that, but at least it's not a straw man.
Right, but when one points out that this ads huge risk because of the new entitlement, it is not adequate to say, "But I might use the new boat to run charters on the weekends when I don't have to work". The new obligation ads risk, full stop, even if you think you've added revenue to cover it. It would be one thing if you were "bending the curve" by making deep changes to the structure of health care financing, but all this does is slash the reimbursement rates, which is not curve bending, and also, is a one-trick pony.
You are conflating risk and cost again. You cannot use these terms interchangably. They mean different things.
Cost = What congress says
Risk = What congress always ends up doing.
Derek
In the context of a budget that is already in danger, new obligations--which is what these costs are!--add risk. You're the one who's confused about the terminology, not me. This is Financial Planning 101.
Holy crap, yer dumb. You don't even know what "one-trick pony" means. Hint: It's a pony that can only perform one trick.
Except it's painfully obvious to any and all that the health care reform on the table WON'T cut costs. And that brings us back to Megan's characterization of the argument.
If the benefits do not kick in until 2014, and the threat of rising costs is not imminent, why introduce the risk and uncertainty of major health care reform now, when the economy is starting mount a comeback from a major recession? In terms of the economy, now is not the time for such reform. That health care may bend the cost curve down is the strawman - Dems want reform now only because they have majorities.
Uh, because Obama and Rahm are trying to convince wayward Senators that they can be safely out of town when the Tsunami hits?
Secondly, between now and then, we are likely to change parties back to the Republicans, at least in Congress. Obama is really, really shrewd here. Guess who gets the blame for fixing the HCR disaster that HE, Pelosi, Reid, Schumer and the entire drunken gang created?
That's right; the Republican Congress of 2014. They will get ALL the blame for the cleanup, simply because Obama and his WH are making the Dems the fall guys for his ambition.
Now then, remember those bogus figures out of the CBO that said Medicare was going to be cut .5T to pay for this? Guess who will take a pass on doing that? The Republican Congress of 2014? Why?
Remember what happened to Newt? There isn't a Republican who doesn't.
Can you say Weimar? I knew you could.
A great article from the WSJ this weekend on some real innovation on health care costs in India.
http://online.wsj.com/article/SB125875892887958111.html
Can anyone explain why the current bill does not offer some simple pro-market reforms, like requiring the cost of all procedures etc to be advertized up-front? Currently, the lack of information means that it is almost impossible to do proper cost-benefit comparisons that are normal in every other activity.
Most arguments are hear against this are variants of the principle-agent problem. This is rubbish, IMO, as other areas such as hiring a lawyer or financial advisor have far more cost transparency. Lawyers would have even more transparency if they were not restricted by local bar rules (which, also IMO, should abolished). If I go to the mechanic and I don't like his prices, I can call 10 other mechanics and get an estimate on the same work, or price out the parts online.
Because that would not feed the Leviathan.
This is an insult to drunken sailors...
Yeah! At least they spend their own money!
This blog entry makes no sense. It jumps back and forth between boat and budget so often that I'm not sure what point, if any, is being made.
A few observations:
1. The US will never go bankrupt, not in our lifetime at least. So take that off the table, and all the parallels that go with it.
2. In case you haven't noticed, the bond market seems relatively unafraid of dollar inflation and long-term budget deficits (i.e. high interest rates). Yes, the dollar has been falling, but so what? Currencies fluctuate. Remember the panic when the euro broke the buck?
3. I have heard NOBODY say that we should spend money today because we might go bankrupt in the future. That's a straw man argument for sure.
I don't know what other bloggers have said. On these boards, I have said that we should pass health care reform because 1) it accomplishes a lot of good things (i.e. insures millions of Americans) and 2) even if it is not a particularly good bill, it opens the door to better reform in the future.
What is driving the opposition to the health care bill is fear. It's the nonsense Obamacare=socialism meme. Once that is extinguished, then a lot of the people whose positions are now "no health care reform ever" will soon become "let's do health care reform better than we are doing." That type of constructive involvement would improve the debate so much it's hard to imagine. Now, the fate of the legislation has been in the hands of dunderheads like Blanche Lincoln, Mary Landrieu and the nearly senile Joe Lieberman, who have finished the job of mangling it that Baucus and the Gang of six began. In the future, we could have a larger majority coalesce around a much better set of ideas.
Once we are all looking for solutions, we will find a better one than 40% of us are trying to defeat all reform. But first we have to get the program started.
4. This reminds me of Cato Institute's new publications on geoengineering. Having spent the better part of two decades denying that there is a problem with global warming (much like insurers and Republicans are doing today), Cato is finally getting with the program. And now, they have something constructive to offer.
I have my doubts that geoengineering of any variety other than carbon sequestration will be a good idea. But I welcome Cato's voice in this debate. Again, once we are all looking for solutions, better ones will come. Personally, I believe we need carbon emissions reductions now -- i.e. cap-and-trade, carbon tax, something like that. But I can be persuaded by better ideas, whether they come from NRDC, Cato, Obama or Mitt Romney.
If the U.S. will never go bankrupt, then I propose raising the income limit for subsidies to 100,000 times the poverty level. We have nothing to worry about from bankruptcy, so why not. Also, we should make all train rides free.
The current health care reform bills are pretty close to socialism. The state will own & control the means for paying for most health care. The state will decide what procedures health insurance must cover. The state will distribute wealth for "more just" access to health care. If you think this is not pretty close to socialism, then it is certainly closer than we are now.
If the goal is to give government more power over health care, then you will not get more people at the table. Once the goal becomes improving the health care system, then more people will come to the table.
Add a profit margin, and replace "state" with "insurance company" and you have the same thing. Everything that has been proposed here to rein in costs has already been done before, by insurance companies. The only way to achieve parity with other countries in terms of healthcare coverage is that everyone is going to have to take a haircut (which is why the issue got kicked down the road to 2014).
I think the main problem isn't socialism, it's that everyone seems to (correctly) perceive that the pie is too small for the pieces every interest group is taking. This is largely a condition of living in the U.S. itself (we're broke), maintaining our present standard of living, fighting two wars, and grinding through a Great Recession.
Yeah, except you can change insurance companies.
Good straw man there. Do you ever think before you post? Take time to think about what someone else is saying? Or is it like Tabbibi said, you scream first and try to figure out what you are screaming about.
The US will never go bankrupt. I didn't say it is impossible for the US to go bankrupt, if we were to do the things that you talk about. In the real world, though, even a very heavy debt load would not push us near bankruptcy.
I am not saying that debt doesn't matter. To the contrary, I think it does. Government debt impacts living standards, and if we have a lot of it, our economy will suffer in some capacity all else being equal.
The question, though, is what we buy with the debt. If we are investing soundly, debt can increase our standards of living. If we use debt to finance important quality of life issues, then it will be worth it in utility terms. If we are squandering it on over-utlitization of health care, unnecessary weapons programs, handouts to seniors, wars, useless education spending, pork, ag subsidies, etc., then we make ourselves poorer.
I try to avoid thinking both before and after posting, and I try to minimize it while I post - it gives me a headache.
My point is that "the U.S. will never go bankrupt" is nonsense. I'm not sure it even counts as an argument. Under that logic, we can spend however much we want with no regard to the consequences.
Most of the squandering of money is done by government. Look at your list: "unnecessary weapons programs, handouts to seniors, wars, useless education spending, pork, ag subsidies, etc." All government spending. And over-utilization of health care is at least 50% government spending.
Let people decide what they want to buy. One-size fits all health care will squander more money.
"The US will never go bankrupt. I didn't say it is impossible for the US to go bankrupt, if we were to do the things that you talk about. In the real world, though, even a very heavy debt load would not push us near bankruptcy."
---------
What bollocks.
They're already knocking around how to get away with monetizing the debt. That's called avoiding actual bankruptcy by treating your currency as if you're buying Marvin Gardens with it.
The Chinese, obviously, don't believe you. And they sent Obama packing with his underwear and a souveineir good luck Cat.
Oh, but let's buy a 2 - 3 trillion dollar health care program with vaporware money that nobody will be able to pay for in the middle of a war.
Jesus wept.
>the US will never go bankrupt, not in our lifetime at least.
So you are in your last few months of life?
Derek
I think you're misstating the reasoning behind doing health care despite looming budget crisis. I think its more along the lines of: "we'll have to deal with the costs of entitlement spending in a very serious way in the near future, might as well deal with the problem as it encompasses (near) universal health care, which would be an important and helpful achievement for Americans."
The Senate bill is actually paid for and then some, no? This isn't some sort of a splurge that was dreamed up just because we suddenly had cash to burn, it's a long-term goal for which funding is being specifically raised. You can argue over whether or not that funding will actually cover its costs, but there's no "refund check" that would otherwise be more wisely invested.
Right, there is no opportunity to cost to this legislation. Just like small businesses will magically get coverage without paying any cost for it.
The bill enacts taxes on many people. Tell those people that the government is going to spend their money more wisely than they could themselves.
You're making a poor argument for the "people", since it's their terrible financial decision-making that got us into this mess in the first place.
Yes, it was poor regulation and market distorting laws (CRA) that got us into this mess. That and rent-seeking, which is the natural outcome of concentrating power. So lets create the same kind of system for health care.
Also, personal debt and sovereign debt aren't even close to being comparable.
At worst, if the U.S. gets into serious financing trouble, we inflate the debt to affordable levels. We're not talking about anything like hyperinflation. 8-9% a year would make a vast difference in our ability to repay. It's a worst-case scenario, and one that should be avoided. But it is also not the end of the world.
Assuming everyone doesn't dump bonds when the inflation starts.
That only works if a) you don't have an independent bank and b) you don't have substantial current financing needs. If you're *still* running a deficit, the interest demanded to cover the inflation risk quickly outstrips the benefits of inflating away past debt.
Yes, you are right, inflating only works if you don't have current financing needs. Well, that's not true, really. What's important is the ratio of debt to current financing needs, but anyway, that's a detail. Remember also that interest expense is a huge portion of our current budget, an expense that will naturally reduce.
The point is that we could spend 10 trillion dollars now as a one-shot deal now, and it would not affect whether the country is solvent in 50 years.
In other words, thinking about the deficit in terms of bankruptcy is lunacy.
I am not saying that inflating the debt is a good thing. Notice how I said "at worst"?
We're nowhere close to serious financing trouble. Perspective, people.
That would be very true, if we were talking about this year's deficit. Unfortunately, what we're talking about is a structural deficit on the order of $750 billion, or 6% of GDP, by 2019.
Megan has already addressed this at length in the past. Bondholders aren't as dumb as you apparently think.
It's as easy as that, eh? Inflating the debt to affordable levels? Well, hells bells, why don't we get started ASAP?
It worked great for Zimbabwe.
What would be the interest payments on the current debt if inflation +2% was the interest rate demanded by bond holders?
Bankruptcy is a reality. You folks don't make much of anything, import most of your energy, don't smelt or refine many metals anymore. All imported. And would be very very expensive with a devalued dollar.
Try raising taxes in that environment.
Derek
Are you an Aussie? Only an Aussie would list smelting and refining metals as a critical world industries.
I don't get this pessimism. Really, I don't. There are problems with the American economy. But the world's strongest economy didn't become its weakest overnight. Last time I checked, Europe was doing pretty badly as well, almost as bad (if not worse) as the U.S. Japan is in terrible shape. Many emerging market economies remain disaster areas.
The only country with a good economy right now is China. And that's largely a mirage, because China's "prosperity" depends on depriving its workers of the fruit of their labors -- i.e. running up a huge government surplus held in cash while keeping the currency really low. And the size of the Chinese economy, per capita, is still very small compared to the US. And China has that problem of holding all those devaluing dollars.
This all reminds me of the Japan scare in the late 1980s. Remember how the Japanese were going to buy all of America's assets, at fire sale prices? How'd that end up?
Last I checked, most of the biggest and most profitable companies in the world are still located in the U.S., and the wages they pay to US workers are very high. Yes, Iphones are manufactured in China. But they are designed in the US. Guess which is the higher value-added aspect?
Muzzy,
"But the world's strongest economy didn't become its weakest overnight"
No it took 20 years of living beyond our means, sending all the dirty parts of our economy overseas and piling regulation upon regulation.
"I don't get this pessimism. Really, I don't"
Of course not, In Muzzy World its good for a country to have more lawers than doctors.
Inflating the debt is despicable.
Shame on you for suggesting it as a good/proper solution.
It is dishonest, it is cheating, it is theft, it is fraud.
Why am I not surprised liberals think it is a great idea?
The problem is the drunken 800 lb. gorilla in the room. Two wars going longer that WW I and WW II added together.
Does war cost money? (That is why we have no money.)
The Father of the U.S. Constitution said war is our greatest enemy.
If that is correct, what we worship is our greatest enemy.
Go figure.
Defense spending as a share of the budget has been going down since the end of the cold war. That doesn't mean that defense spending can't be a problem, but wars are not the largest fiscal problem for the US over the next 20 years by any stretch.
DOD spending hasn't gone up all that quickly compared to entitlement spending, even during the Bush years. The vast majority of the government's program spending(over 2/3) is social, not military.
I have no idea why anyone would think that there is no difference between going bankrupt now, and going bankrupt later, which is assuredly untrue.
I think this analogy only goes so far. A national or state 'bankruptcy' isn't quite like one for an individual or a corporation. Living in CA, I wish that the state could go through ch.11 where the court could undo some really horrible arrangements the state made in the past.
Sovereign debt defaults destroy your ability to borrow money, which means you suddenly have to balance the budget RIGHT NOW, often violating implied promises to various citizens.
Forgive me for being obtuse, but I take 'sovereign debt default' to mean thumbing our noses at creditors (like the Chinese) and saying 'we ain't gonna pay you back'.
Is this what you mean by 'bankruptcy' for the US?
In this case, I agree with other posters - I don't think this is going to happen. Neither we, nor the Chinese, would ever let things get to that point.
Paying them back in grossly inflated dollars (without ever explicitly defaulting) is the more likely scenario.
So I guess I am still wondering what, exactly, a 'bankruptcy' is for us.
Not too hard to imagine.
One of the danger signals that Wall Street firms are very close to the edge is their ability to borrow long term. Lehman and others towards the end were getting overnight loans to keep going the next day. No one would lend them money for longer terms because they weren't sure they would survive. But they might survive another day.
The US debt is being turned over in short term bonds. Long term sales have been problematic. Why so?
What bankruptcy for the US would mean is imports would have to be paid in another currency, or with goods. The US has had a very large trade deficit for so long without ill effects that it seems normal to borrow for imports.
When the dollar is no longer the currency of choice, goods will be priced in something else, and the devalued US dollar will buy far less of them.
And bond holders will demand higher interest rates, or even that bonds be denominated in another currency.
Since last fall, the whole world has been determined to get things going the same as it was. US consume, everyone else produce. The stimuli in the US and elsewhere, bailing out the banking sectors, etc.
There is still faith that it will come back. A V shaped recovery, etc. With the volatility and uncertainty in Europe and elsewhere the dollar has been seen as the least worst.
But what if the economy doesn't turn around? There are some signs of weakness. What if the US continues with a very low interest rate policy, driving away foreign investors looking for a return? What if there is a second round of financial failures, and congress doesn't pony up the money to prop them up? What if China starts figuring out a way to grow without the US consumer, not only China, but India, Korea, Brazil? (Japan is toast). To attract capital to fund medicare and social security, they will have to pay higher interest rates. Every year the equivalent of TARP or the Stimulus bill is spent on interest. Every year.
What if someone does something dangerous, like Russia annexes the Baltic States, or Iran gets twitchy, or Pakistan and India start shooting at each other. Or N Korea gets twitchy and a minor altercation starts a hot war with the south. Or Japan. The extremely fragile financial system and economic recovery could collapse in crisis.
It has been a pretty quiet year considering how fragile and dangerous things are. And the US is in no position to respond. They will be the victim of almost anything that happens.
Derek
Of course this entire post is based on assumptions that have no basis in fact, but I suppose that hasn't stopped you yet...
#1 You assume that passing healthcare will have a net cost rather than net savings. You know as well as I do that the estimates indicate savings of $650 Billion dollars over the next 20 years, with savings continuing to accrue. (No Megan, the margin of error on the CBO estimate is not greater than 100%, given historical accuracy its probably 10%, at most)
#2 You assume that we're in some sort of dire situation with regard to the debt without any evidence to back you up. I can see why you would want to avoid the evidence on this issue as it tends to contradict your point. Interest rate and CDS spreads indicate below average risk of inflation and default. Also note that the budget projections of today look particularly dire because extrapolation is being done from an outlier(ie we're in recession). This explains why the market indicators for default and inflation do not indicate the risks you imagine.
#3 You also completely ignore the intangible benefits of the healthcare bill. (ie benefits that are difficult to score in dollar amounts). These are things like the benefit of greater public health, fewer emergency room visits, cost effectiveness research and pilot programs to identify the best ways to create savings on the long term. (These pilot programs and cost effectiveness research are particularly important to future savings, in that they allow us to experiment with new mechanisms of savings).
"#2 You assume that we're in some sort of dire situation with regard to the debt without any evidence to back you up. I can see why you would want to avoid the evidence on this issue as it tends to contradict your point. Interest rate and CDS spreads indicate below average risk of inflation and default. Also note that the budget projections of today look particularly dire because extrapolation is being done from an outlier(ie we're in recession). This explains why the market indicators for default and inflation do not indicate the risks you imagine."
I'll sleep a lot easier now. Markets never screw up, which is why you never see Democrats claiming we need more regulation.
Actually prior to the housing crisis markets indicated a serious bubble, but it was the pundits who claimed everything was fine. Right now pundits are claiming there is a serious but the market indicators show that there is not.
srsly? You mean the majority of our largest financial institutions did not plunge into toxic mortgage assets years after I, and the majority of serious financial journalists, were saying the housing market looked distinctly frothy? What papers were you reading?
"You know as well as I do that the estimates indicate savings of $650 Billion dollars over the next 20 years, with savings continuing to accrue."
Every post I've read on this subject has criticized the assumptions made in this projection and you still use it as if it settles the issue. WTF?
It isn't perfect, but the estimates are the best that anyone can provide. But people tend not to be very precise about what this means. Given the historical accuracy of the CBO it is probably less than you imagine. We're talking about a savings within a reasonable high confidence of $575 Billion and $725 Billion.
That is a fairly large error in a quantitative sense, but it is not the 100% error that would be required to make this bill not save money. Errors on the magnitude necessary for Megan's claims to make sense are astronomically improbable.
I'm not talking about the CBO's margin of error. I'm referring to cuts in reimbursement that probably will never be made. The problem is the CBO has to assume congress actually keeps the law the way it is written.
You mean you are talking about the sustainable growth rate(SGR); a separate bad policy started by Republicans, which Republicans are now trying to use to stop congress from passing a separate bill that saves money?
zosima,
You are living in a fantasy world if you think any politician, republican or democrat, is going to cut benefits to any organized intrest group.
Zosima, c'mon. The savings in the BBA: within a reasonably high confidence level of 15%, even 10 years out? Your claims are launching farther from reality by the moment.
#1: this is largely result of accounting gimmicks. Elmendorf does not think the score reflects the reality. It also does not reflect the risks that it will not succeed in controlling costs and that it will not go over budget. Both risks are not insignificant.
#3: the benefits are completely speculative. The benefits could be achieved in alternative ways that do not involve an expansion of government. You also leave out the intangible harms: reduction in innovation and the reduction of control over health care decisions.
By "reduction in control over health care decisions" do you mean reduction of control by doctors and patients?
If so, this is a benefit, not a drawback. That's the main problem behind over-utilitization, which is the main drivers of costs.
The main driver of over-utilization is the third party payer system. It is classic tragedy of the commons: an individual has no incentive to conserve and every incentive to consume as much as possible.
All spending is not equal. Spending by the government on what health care it thinks I want is not the same as me choosing what care I want and how much I am willing to pay for it.
Reducing control reduces the actual quality of the care that people get. You'll get RMV medicine, not anything customer-focused. That is bad for the patient. The point of the whole exercise is to benefit the patient, not to spend a trillion or so dollars on any random arbitrary enterprise that happens to have the phrase "Health Care" pinned on the front.
The way to reduce costs is for customers -- patients -- to pay for what they get. Customers are cost-sensitive. When they're footing the bill, they watch the pennies, and they care about the quality of their care infinitely more than some bureaucrat will ever care. Now, maybe the patients should only be paying 10% or 20% of what everything actually costs, or something like that.
Let the customers decide where the money goes, make it matter to them how much gets spent, and let the providers compete to provide care. You will get better care, cheaper.
The health-care industry is not set up that way now. It's a bureaucratic nightmare. It would take some time for providers to adjust to focusing on the customer's needs, but the end result would be better, cheaper care for everybody. It would be like Toyata competing against Nissan and Subaru: The cheaper and better their products are, the fatter their profits. Golly gee! How about that! Cutting costs benefits them, so they cut costs! Better products lure more customers with more money, so they improve their products! Who ever could have imagined such a thing?!
In health care, customers lack control already. Providers lack control already. Costs are spiralling, and quality is nothing to write home about. Less control will make that worse. If your goal is to transfer ever more power and wealth to some central authority just because centralization of power turns you on in some way, you're on the right track. If you cared about health care, these kind of Soviet solutions wouldn't appeal to you.
The main driver of over-utilization is supplier-induced demand. I'll go through this a million times if I have to. The third-party payer system emerged in part as a response to supplier-induced demand. One area where they help is controlling doctor reimbursements. Doctors complain that they don't make as much money as lawyers. That's a good thing. Of course, we don't want to kill the golden goose, but imagine how bad out system would be if doctors were regularly bringing home $1M+.
The other thing that a third party payer system does is create a cross-subsidy from healthy to sick. That is considered morally just by pretty much the entire Western world, save a few Randian stragglers, so there's really not much point in arguing that.
As for reduced control reducing quality of care, there is absolutely zero evidence that. None. You might recall that there is more control over health spending in European countries and . . . let's wait for it . . . well their health care systems are pretty darn good. Even if you think ours is the best (against all logic, but hey), there's simply no way to contend that it's the best on a dollar for dollar basis.
Again, if you want a system where "patients pay," explain why that system is so great to a manic depressive 35 yo who depends on two brand-name pharma drugs and weekly group therapy sessions to survive. For the rest of his or her life. Or any of the millions of Americans who have chronic ailments that would not be covered by "catastrophic care" but require expensive care -- care that would bankrupt them if they had to pay by themselves.
The idea that patients care about the quality of their care does not support your argument. It is evidence against it. It is because patients care so much about their health care, but have so little means to evaluate it, that they are vulnerable to over-utilization.
The third-party payer arose because the US government didn't tax health insurance. Not supplier-induced demand.
Go ahed. Repeating your line a billion times, if you chose.
Muzzybelly says
"Doctors complain that they don't make as much money as lawyers. That's a good thing."
Are you f-ing kidding me.
Parasites (lawers) shold make more that people that heal the sick?
You are a f-ing idiot.
Stay classy, JoshinHB.
Actually, my point is that doctors shouldn't be paid as much lawyers currently are. Lawyers shouldn't be paid as much as they currently are either.
One positive development emerging from this crisis/recession is that companies are finally starting to get serious about controlling their legal costs. A lot of fat cat law firms are getting slimmer.
JoshinHB, you have really warped priorities. You think the point of paying people is to get them to work.
The point of paying people is to assuage muzzybelly's views on how they should be paid.
#1 While the bills *do* have accounting gimmicks, that does not mean that the bill doesn't save money. In fact it is the opposite. The savings grow, and the rate of savings grows after the 10 year scoring interval.
#3 Well, the benefits of better health and the benefits of decreased emergency utilization(per capita, at least) are not speculative.
The benefits of cost effectiveness research and pilot programs are speculative, but they are also reasonably cheap. So if they don't pay off, we won't lose much, but if they are successful, the potential for future savings is very large.
The alternative is not implementing these pilot programs and it is certainly the case that if we don't start experimenting with mechanisms for reducing costs we're not going to get any better at reducing costs.
As to what Elmendorf thinks my interpretation of his statements is that the estimate only fails to reflect reality w/r/t the SGR. If you happen to have the psychic hotline on speed-dial, then feel free to correct me.
If the SGR is inevitable, then a world where we pass the health reform is a world with a smaller debt.(SGR alone costs $210 Billion over 10 years, SGR plus reform is $89 Billion over 10 years).
It seems that the Republican strategy for killing healthcare is to argue that we shouldn't do a good health-care bill because the Democrats are not willing to reverse a bad Republican policy. It really takes the term "poison pill" to a new level.
>benefits of decreased emergency utilization(per capita, at least
Huh?
As more and more americans get care at the low rates that government will pay doctors, the clinics will cut back services for economic reasons, eventually only offering initial diagnostic consultations. For the simple reason that they can't afford to offer any higher level of service.
Which means that for anything more than a sore throat, you go to emergency.
Unless you swallow the tax penalty of a good insurance policy, made more expensive by the smaller pool. Then you may have access to higher quality care outside of the hospital setting. For a while at least.
Derek
#3, their benefits are not speculative. Whether the US will see those benefits as a result of this bill is entirely speculative, however.
The people telling us not to worry about bankruptcy are not the ones buying the figurative boat. It is the man selling us the boat who is telling us not to worry about going bankrupt. Him, and some others who think they won't have to pay for it either. They think Congress is going to steal all the boats, and give one to everybody, and then there will be enough boats to go around, even if there aren't enough now. And the boats will all be free, because they'll all have been stolen. Right?!
You can tell crooks they're crooks, and you can tell dumb people they can't make everybody richer by robbing from everybody and giving to everybody else, but neither group is listening to you. They are perfectly happy just the way they are.
There's no way around third party systems unless we go totally laissez-faire. And that's not going to happen. As long as we're not willing to let sick people who happen to be poor or aged die on the street, we're talking about using government money. And that means some people at least aren't going to have "skin in the game." Come to think of it, as long as we have private health insurance we're looking at the same problem. And how do we avoid that, pray tell? Do you seriously think more than a fraction of the population could possibly save adequately to deal with the costs of a battle with cancer? Or kidney disease? Or a heart attack?
I agree we could lessen the third-party-payment problem through reform, but the votes don't exist for Wydencare, although (via the exchanges) we will put the pieces in place for such a move in the future via the HCR bills we're currently contemplating.
Health insurance should be just that: insurance. Insurance should pay if a person gets cancer or kidney disease or a heart attack. It should not cover routine care. We do not have the same problem with automobile insurance, life insurance, or home insurance. Tax breaks for employer sponsored health care artificially increases demand for full service, gold-plated health care plans that cover everything.
Consumers should have more skin in the game in terms of higher deductibles. Those who cannot afford minimally acceptable health care should be given subsidies or tax credits. None of this unmeasureable transfer of wealth through insurance pools. This is far from a laissez-faire system.
I agree. But how does that address the third party payer problem? You know, you've paid premiums all these years, so you want no expense spared, now that that you're the one who's got cancer.
People harp on this issue all the time, and although I don't necessarily disagree in theory, it's kinda sorta really neither here nor there: because what's driving our society into the poor house isn't the cost of checkups, or blood sugar tests, or other, similar examples of basic care. What's driving us into the poor house is the cost of heroic, catastrophic medicine to heal or keep alive extremely sick individuals -- many of them very old extremely sick individuals. Personally, I'd be open to a shift to a system of universal catastrophic insurance combined with HSAs if we could make such a system work and be remotely equitable. This might have been the type of thing that the GOP could have offered up as a constructive contribution to the issue. They're not interested in being constructive, however.
Sure does. So hopefully like me you support the Senate plan feature that starts to do something about this.
Well, then hopefully like me you support either the House or Senate bills, because they give subsidies so people can afford health insurance.
The bills provide subsidies in a crappy, nontransparent way. The bills do not take away the employer tax credits or do anything to the current system except make it worse. So no, I do not support them.
I am no fan of the GOP, but the Dems are not coming anywhere near the center. It sounds like maybe we could have a rational discussion at a different time. And if this were a different year we could come to some kind of agreement. But the government involvement is too great.
It at least localizes the problem. Routine care can come out of the patient's pocket. It does anyway, along with the overhead.
MM: Mental Health Break:
"The Apprenticeship of Duddy Kravitz"
http://www.imdb.com/title/tt0071155/usercomments
On political ethics:
1) When Congress was preparing to declare WWII,
one member refused to give up her right to object,
and the rest ran right over her.
2) When newsmen covering Congressional debates
started using recording equipment, particularly
television, they were banned from the proceedings.
3) See also the 1968 Democratic National Convention
presided over by Richard Daley: "Here is your fire axe;
If I give the signal, you cut the TV feed cable in half.
You would eventually accumulate enough real-world experiences
like those above to change your views, but you do not have time;
As Mark Twain remarked: "You may not believe this, but your
neighbor does, if he is fifty."
To return to your field, economics, what do you think of this:
http://www.telegraph.co.uk/finance/economics/6599281/Societe-
Generale-tells-clients-how-to-prepare-for-global-collapse.html
in relation to funding Health Care and Cap-and-Trade ?
TomB: What are you talking about? Have you, um, followed the debate at all? The Senate bill's primary financing vehicle is a change in the tax code to remove "the employer tax credits" (by which I assume you mean the non-taxability of employer-paid health insurance premiums). Now, if I were king for a day the change would be faster and more wide-ranging than what the Senate is proposing -- ie., relatively generous caps above which an excise tax will be charged. Still, it's a huge step in the right direction because the caps are indexed for overall inflation -- and not health care inflation. In other words, with the passage of time, the tax code subsidy for employer-provided insurance -- if this provision is kept in place - will be eroded away and eventually fade toward insignificance
Again, I'd go faster and further if it were up to me. But this is nonelthess a really good first step.
You're way off base here. Any legislation that has the support of people like Blanche Lincoln and Ben Nelson will be about as centrist as can be imaginable. A lefty bill would be single payer, or "Medicare for All" or a strong public option setting rates based on Medicare. None of these elements will be in the legislation signed by Obama, much to the dismay of liberals. You're confusing a lack of GOP participation based on political calculations with a lack of moderation.
As always, Megan creates arguments that 'prove' that it is better to do nothing and let disaster happen rather than to do something that may have a chance to avoid disaster. Of course, these arguments are mainly developed when large corporate interests are at stake. People are killed in America every day because they lack adequate health care, or the health care they have paid for has suddenly disappeared. I know people that have been killed this way. Most of you probably do, too. Of course, the loss of a few lives here and there is of less importance than the preservation of a corrupt and inefficient medical/insurance industry. So if you agree with Megan, then you agree that it's ok when your insurance company rescinds your coverage or the coverage of your family members. In fact, you should applaud the insurance company when it rescinds coverage, because, obviously, it's good for America.
If Megan were serious, her arguments would be about what reforms can be productive rather than saying anything you do is no good, by definition. But, hey, I've got good insurance that should last my lifetime. So I agree with Megan: I've got mine. Who cares what happens to you.
The point she is making, and I agree with it, is that the US treasury is going to have to cut deeply without regard to the consequences to individuals due to not being able to collect anymore taxes/not borrow any more money.
Health care spending will be one of the first to go. It will be tranfered to the states, or something like that, but the end result will be a serious deterioration in the quality of care.
So why would you want to put more people in a place dependent on a dysfunctional government program that cannot be supported?
You would like to see the situation improved. The current proposals are guaranteed to make things worse for most americans.
Derek
than the preservation of a corrupt and inefficient medical/insurance industry
Anything the likes of you create will be 10x as corrupt and .1x as efficient than what we have now. 'Nuff said.
Hey ...Max... and derek
May you and your families have their insurance rescinded. ...Because according to Megan it's good for America.
Of course, the elder members of your families may be covered by medicare, a government program. Why don't you tell them to walk away from it and pay for their own medical care out of pocket or out of your pocket.
Go ahead. It will be good for America.
Tell them to John Galt it.
Moral preening.
My health coverage as an insured, fully paid up canadian is regularly compared to uninsured americans. There is some debate as to which gets better care.
A couple of months ago, the government in this province, facing serious tax revenue shortfalls, decided that 20% of the diagnostic MRI scans were unnecessary. In our local hospital, 6 nurses were recently laid off. Funding shortfalls. My GP is retiring. There are no replacements.
I know personally people with fully paid up government coverage who have had to wait years for diagnostic procedures.
Tell me now. How does that save money? How does making someone wait 6 months for an angiogram save money?
If you believe that somehow government will have all the resources, all the answers and you won't have to pay for it, or won't be denied necessary care, dream on. Reality will hit sooner than later.
Derek
Ah, but you're guaranteed care.
Me, I think that you are merely told you have a guarantee, but I'm cynical. No doubt we can write on the tombstone. . . .
"Because they know all they sold ya was a guaranteed piece of shit. That's all it is, isn't it? Hey, if you want me to take a dump in a box and mark it guaranteed, I will. I got spare time. But for now, for your customer's sake, for your daughter's sake, ya might wanna think about buying a quality product from me."
-Tommy Boy
May you and your families have their insurance rescinded
May you end up at a hospital which only has local antiseptics in stock. All other medicines you'll have to provide yourself, from the black market.
And may your stay be free. You'll be getting what you're paying for, after all.
I have seen this IRL. Perhaps you'll be that lucky, too.
This all depends on how much you value (if at all) the goal of expanding coverage and helping make health insurance affordable for those with jobs that don't provide using federal subsidies in the first place. If you greatly value that objective, then the notion of making it policy before a major austerity crunch is forced on U.S. budgets makes all kinds of sense. If you value that step only moderately favorably, or certainly if you are utterly indifferent or even view as undesirable in itself, then you certainly wouldn't view it with any greater favor in light of looming deficits.
Every industrialized country has universal health insurance. No industrialized country has "gone bankrupt" because of health care costs. No industrialized country is even thinking of going bankrupt because of universal health insurance.
Among the countries that have UHC are Germany and Singapore-two of the most fiscally sound countries on the planet.
The USA, the largest economy in the world, is most certainly not going to go broke because it moves to UHC. It's a straw man. now if you want to beat that strawman because it warms your conservative heart, go ahead.
In the mean time, else where in the Atlantic, Ron Brownstein has this to say:
When I reached Jonathan Gruber on Thursday, he was working his way, page by laborious page, through the mammoth health care bill Senate Majority Leader Harry Reid had unveiled just a few hours earlier. Gruber is a leading health economist at the Massachusetts Institute of Technology who is consulted by politicians in both parties. He was one of almost two dozen top economists who sent President Obama a letter earlier this month insisting that reform won't succeed unless it "bends the curve" in the long-term growth of health care costs. And, on that front, Gruber likes what he sees in the Reid proposal. Actually he likes it a lot.
"I'm sort of a known skeptic on this stuff," Gruber told me. "My summary is it's really hard to figure out how to bend the cost curve, but I can't think of a thing to try that they didn't try. They really make the best effort anyone has ever made. Everything is in here....I can't think of anything I'd do that they are not doing in the bill. You couldn't have done better than they are doing."
Gruber may be especially effusive. But the Senate blueprint, which faces its first votes tonight, also is winning praise from other leading health reformers like Mark McClellan, the former director of the Center for Medicare and Medicaid Services under George W. Bush and Len Nichols, health policy director at the centrist New America Foundation. "The bottom line," Nichols says, "is the legislation is sending a signal that business as usual [in the medical system] is going to end."
http://politics.theatlantic.com/2009/11/a_milestone_in_the_health_care_journey.php
With all due respect, I think that we have to take the views of Gruber,McClennan, and Nichols-respected health care economists-over libertarian fear mongering by Megan.
Every industrialized country has universal health insurance.
Another, 'country xyz does this, so why can't we?' argument. As if we could just wave a magic wand and become Germany overnight. The point is, we aren't Germany - their health care system is the product of evolution over time, just as ours is. In both instances, they are big, complicated systems. For us, it isn't so much what the desired end state is, as much as the transition to it that I am concerned about.
The USA, the largest economy in the world, is most certainly not going to go broke because it moves to UHC.
If and when we 'go broke' it probably won't be for any single cause. If you throw in badly done health care reform, with 2 wars, with cap and trade, with umpteen bailouts ... well you get the picture.
>No industrialized country has "gone bankrupt" because of health care costs.
Canada almost did. They (we) enjoy now the wonders of waiting lists. Tell me now, how does having people wait months and years for procedures save money? Spontaneous remission?
Derek
My mother told me something about "if everyone else was doing something"...
What was it again?
Opinions on debt from people who actually understand what they are talking about and are unafraid to support their claims with actual statistics:
http://baselinescenario.com/2009/11/20/government-debt-hysteria/
http://baselinescenario.com/2009/11/23/government-debt-obama-budgets/
Now I want to hear the story about Megan's ex.
At least I hope it's her ex. OTOH if he's in a manic phase she might get a really awesome wedding out of it.
Peter is admirably sane.
To the poster who linked the WSJ article on "The Henry Ford of Heart Surgery":
(link again: http://online.wsj.com/article/SB125875892887958111.html)
This is exactly the type of thing we should be doing. But you see, Dr. Shetty didn't invent the concept. Specialized hospitals have been around for a long time, and have flourished under (gasp!) state-run medical systems. A famous example is the Shouldice Hospital for hernia surgery in Toronto, established I think in the 1950s. It performs high volume, high quality surgery for a fraction of the cost as in a US hospital.
Doing this sort of thing would be much easier under a system of state-run utilization review. This is a very good argument in favor of nationalizing health insurance, although leave it to the WSJ to pretend as if it argues in favor of free market health care.
The Shouldice Clinic was (indirectly) involved in one of the funniest dumb answers ever given by a politician, as far as I'm concerned. Jack Layton, leader of the left-wing New Democratic Party of Canada, has in past made comments about how healthcare has to be government-provided, and private provision of healthcare is a terrible thing Canada shouldn't do. He then gets a hernia operation at the Shouldice Clinic. Reporter asks him shortly thereafter why he got his treatment done at a private clinic, Layton's answer is something along the lines of "It was private? But I paid with my health card!", to which every Canadian with a brain replied that that was the entire point.
I believe that most of the people who support universal health care also support:
1. raising taxes, even on people making less than $250,000
2. taxing employer health benefits, which CBO estimates will progressively bend down healthcare inflation such that the Senate's healthcare reform bill more than pays for itself in the second decade (2023-32) even without more taxes
3. empowering a MedPAC commission to make mandatory spending reductions in Medicare, which seems to be the strongest possible institutional change for controlling Medicare spending
...and a number of other painful and concrete measures. I don't think that merits being called "manic depressive" or compared to a heavily indebted person wanting to buy a boat. At a minimum, you have to change the analogy to an indebted person who proposes earning an extra $50,000 and using that to buy a $45,000 boat. You say he should earn the extra $50,000 and not buy the boat. That's where the analogy breaks down, because the indebted person explains that owning the boat is actually a pretty realistic first step to relieving the rest of his debt, being as how he is a (fisherman/used boat dealer/yacht tour entrepreneur who has previously had to hire yachts at high expense/see I told you the analogy breaks down here).
Or, um, incidentally, that's not quite right either, because having poor people not get needed medical treatment isn't really comparable to some kind of luxury good like a boat. I think it might be more comparable to a heavily indebted farmer who currently raises hogs in cruel conditions in a big concrete mass shed, and proposes earning an extra $50,000 and spending $45,000 to become a free-range farmer who raises his pigs outdoors in a relatively morally acceptable fashion. You're saying he should earn the $50,000 and keep the pigs in the shed. Except that's not quite comparable either, because if he does go bankrupt the pigs won't suffer more, they'll just not exist. In fact, you know what it's comparable to? It's comparable to an indebted country where 10% of the citizens don't have health insurance that decides to raise an extra $95 billion a year and spend $90 billion a year giving the rest of its citizens health insurance.
Let's put it one final way. This year, next year, and the year after that, America will spend at least $60 billion per year trying to bring [rainbows to fairies] good government to Afghanistan. And none of that is paid for, not a red cent. Is the decision to raise an extra $95 billion and spend $90 billion on getting everyone health insurance the place to focus one's energies, if one is worried about the national debt? I can't find a phrase strong enough to express how wrong I think that is.
More accurately, the indebted person is pimping his children on the street corner to make the extra money.
I have a theoretical question that maybe someone will know the answer to.
I am a relatively young, single, healthy male who does not consume a lot of health care. I have a well paying job with what would be considered a "Cadillac Plan".
Is there anything that would hypothetically stop me from negotiating with my employer to drop me from their health coverage and add some percentage (say 66%) of the saved costs onto my salary? As I understand it, there would be no way that the new system would reject coverage for me or make me pay full value out of pocket. I would be able to sign up for a government plan or pay the 'no insurance' penalty while banking another 8 or 10k per year for myself.
Maybe I am missing something, but this would seem to be an entirely rational behavior for any young, single person in my circumstances.
Does anyone know if this would be possible under the proposed plans?
Nope, you are absolutely correct and there is a huge incentive for healthy people to drop their coverage, pay the minuscule fine, and then buy insurance if they get sick. The end result is more sick people in the pool and more healthy people out of it, and a fairly equivalent number of American's uninsured.
This is the iceberg that nobody has an answer for, and hence nobody is willing to talk about. I haven't heard anybody even TRY to address this particular land mine.
It's almost as if massive government programs have unintended consequences (see "welfare and out-of-wedlock births)!
If only the country could end up with this result- the manic depressive ends up bankrupt and destitute, while the former girlfriend moves along with her life. What we are discussing here is not this outcome. The manic depressive is spending our bank account and our credit cards.
And we are all named Edmund Andrews.
The purpose of government is to protect us from each other. Today's government, however, is the instrument we use to attack and steal from each other. Since the introduction of the income tax in 1913, we have a license to steal money from each other via "majority rule".
That cannot go on forever. And as far as I'm concerned, the faster we bankrupt this perverse system, the faster we get to start over and once again call ourselves free people.
The problem is such Weimar Republic conditions might lead to a Bolshevik Revolution and millions of deaths. We are better off maintaining the miserable status quo.
Megan,
You're cruel. I just bought a boat!
Bill
I still have yet to be explained why insuring the uninsured requires a complete overhaul of our medical system. Why not just bring them into Medicare? You'd not need more then a 10-page bill for that.
Because doing that would destroy private provision of medical care utterly. Since that's something that the Democrats don't want to be seen to be doing(or maybe they actually don't want to do it, I dunno), that's not a viable political solution.
"If the government goes bankrupt, millions of people will lose that subsidized coverage ..."
The taxpayers may go bankrupt, the govt. will overdrive the printing press. The USA will be Argentina of the North, the Weimar Republic of America.
Its a fair question. If we end up spending a trillion dollars for 7 years of covering 20 million extra people, we could flat out give them 7100$ a year to buy health insurance without requiring anything from anyone else (aside from your tax dollars they are going after anyway).
Power, money.
Power for politicans to decide how you should live and behave. E.g. No more junk foods which will make you fat which will cause you lots of health problems which will burden the healthcare system which will cost the govt. tons of month.
Power for politicians to earmark your money to reward their friends and families.
A 10-page bill or a serious reform may solve the healthcare problems, but will not solve the politicians' problems.
Mark, ic,
I think an excellent strategy for the GOP would be two produce 3 healthcare bills:
1. Market reforms, national market, creation of exchanges, etc. (I think they already proposed this and it saved 65 billion dollars and increased some "access."
2. Pre-Existing condition bill, with a price tag.
3. Extend coverage via healthcare vouchers up to a certain income level. With a price tag.
Then have an open vote on 2 & 3 (by this I mean no party whip, etc.)
I bet 1 would pass, 2 might pass, and 3 would have people choke on the cost.
The comprehensive 2,000 page bills are essentially bs and people know it. Why not smaller bills, with more discussion? Even the 'SINGLE PAYER NOW" libs should be okay with honest debate. Why this "rush to public option?"