• Health Care,  Uncategorized

    Reasons for Pessimism

    Some of my conservative friends have suggested a couple of reasons not to be utterly depressed by the passage of health care reform:

    1. Voters will angrily sweep Republicans into power.
    2. Republicans will rally the country around repealing health care reform.
    3. We now have an actual bill that voters can evaluate, and the bill will create its own opposition.

    I always have to ask my friends whether they are being sarcastic, or actually delusional.

    Republican resurgence is miserably insufficient to comfort anyone who opposed health care reform on principle, so we can breeze on to the second point. Though, I am generally skeptical that Americans really oppose these reforms, or that conservatives will control government in 2014!

    Republicans don’t actually oppose health care reform. They pretend to. But ask them why they dislike Obamacare, and they generally recite something incomprehensible about big government or socialism. Then they advocate something identical – like the conservative Heritage Foundation, which sponsored the same reforms in Massachusetts alongside Republican Governor Mitt Romney. Damningly, most conservatives – notice Republican Senator John Cornyn– still consider prohibitting insurers from denying coverage to already sick patients to be “uncontroversial”. Yet this “reasonable reform” inevitably leads to every major item in the Democrats’ health care legislation. More on this anon.

    Which brings us to the final argument. How, exactly, are people supposed to be able to evaluate the effects of this bill? As far as I can tell, they can’t. Most people today get their health care through their employer. This cuts into their wages, but they don’t know how much it costs because their employer never tells them. The reforms will not change this. People will continue to mainly receive insurance through their employer. Insurers will now be forced to cross-subsidize and offer more strictly defined plans. This could increase price and decrease choice, but employees will never see these changes. Their employer will still make the major choices for them.

    Low income individuals who will be offered subsidized insurance through pseudo-market health care “exchanges” will see a fairly large change. But why should they complain? They lose a bit of freedom by being forced to buy insurance, but likely gain from the subsidies. Do we really expect them to revolt against another quasi-welfare program? Hardly – the fact that Democrats have built a party around buying votes with entitlement programs suggests that it is a successful political strategy.

    The strongest arguments for or against health care reform have always been the long run counterfactuals. Progressives argue that the reforms will “bend the curve” of health care cost increases by taxing insurance into submission (other even more mystical-sounding claims are also made). Reform opponents counter that the bill will slow innovation in medicine and delivery systems by further delinking consumers from the costs of health care. I side with the opponents, of course, but the general public can’t appraise these arguments merely by watching the legislation work its magic. That’s why the arguments are counterfactuals. There is no alternative reality that we can compare our world to.

    Finally, there are the taxes. Nobody likes them. But every spending program has come with new taxes. Social Security and Medicare have much more visible taxes linked to them. Yet no major spending program, to the best of my knowledge, has ever been repealed because of taxes. Occasionally the taxes themselves have been lowered. Then they have been raised again. But the spending remains. The taxes, in this case, aren’t even that important: health care reform does most of its damage through regulations and cross-subsidies born directly by the insurance companies and their customers.

    In the end, no bill ever gets a careful examination after its passage. People have too much going on in their real lives to waste their time figuring out whether any particular piece of legislation is good (or just). Even if they did, there is little or no information with which to make a “practical” judgment. Expect even the “experts” to be debating the effects of this bill a decade from now. The only people who will care are those that derive a large benefit from the program – like the senior citizens who defend Medicare tooth and nail. 2014, the earliest the bill could be repealed by Republican lawmakers, is a lifetime away for our rationally apolitical electorate. If voters still remember health care reform, even if they still dislike it, they probably just won’t care that much. But reform comes with a built in interest group – the medical profession – that stands to gain access to new, paying patients. We can expect them – doctors, insurers, and hospitals – to loudly defend this legislation with the false moral clarity of other people’s money.

  • Uncategorized

    Romney Really Wants You To Vote For Him

    The day after health care reform passed, Romney was ready with a biting attack on Obama in National Review Online. Among the criticisms, Romney says:

    Rather, it is an historic usurpation of the legislative process — he unleashed the nuclear option, enlisted not a single Republican vote in either chamber, bribed reluctant members of his own party, paid-off his union backers, scapegoated insurers, and justified his act with patently fraudulent accounting. [emphasis added]

    I found the entire piece, and particularly the complaint I’ve bolded above, to be fairly hilarious. Romney, the former Republican governor, crafted a health care reform in Massachusetts that was a near carbon copy – and some would say the model for – the just-passed legislation. Yet Romney wants us to believe that there is something especially insidious about Obama’s bill because it was passed with no bipartisan support.

    The corollary of this is that Romney must be forgiven for passing health care reform before passing health care reform was the not-so-cool thing to do. Because he’s a Republican, he automatically grant a bipartisan imprimateur to any entitlement he hands to Democratic legislatures. So there is nothing bad about the new taxes, entitlements, and coercions that he sponsored. How could there be?

    And the title of the piece? “A Campaign Starts Today”? We get it. You’re running for President in 2012. But Republicans should be reminded by these timid procedural complaints that Romney is not the man who can rebrand the GOP as the party of liberty and freedom. He probably can’t even be trusted not to pass something even worse.