June 10, 2009

Click on WORD or PDF for full content

WORD

PDF

During the debate over Hillary-Care, Phil Gramm was famous for his aside that if it passed, “We would never be able to unf**k it.” Mona Charen in National Review revives the thought, but more delicately, when writing about Obama’s health care plans.

You might suppose that President Obama has his hands full running two wars, administering General Motors, “rescuing” the banking system, attempting to empower unions over management, hushing up whispers about hypocrisy regarding Guantanamo detainees, managing the mortgage crisis, imposing “clean energy” on the nation, handling nuclear North Korea and nearly nuclear Iran, “stimulating” the economy, reviving the “peace process” between Palestinians and Israelis, inaugurating a new relationship with Russia and with the Muslim world, and reversing the rise of the world’s oceans, but no, he has one more agenda item — overhauling U.S. health care.

The administration is hoping that a health bill will be voted on by early August, which may be overly optimistic but still means that this summer will be dominated by the health-care debate. Its outcome will determine the overall success or failure of Obama’s effort to torque America toward the European model of statism. It isn’t just that the health-care sector accounts for 17 percent of the U.S. economy. It is also the case that, if enacted, a nationalized health service — no matter how crushingly expensive or bureaucratic — will vitiate arguments about the proper scope of government. All future pleas for reducing the size of the state will run into the accusation that the small-government advocate is eager to take antibiotics from the mouth of a child or insulin from a diabetic. …

In his blog, Keith Hennessey, former economic advisor to Bush 43 provides his understanding of the shape of the health care bill.

… Calling it the “Kennedy” bill is something of an overstatement.  Senator Kennedy chairs the Senate Health, Education, Labor, and Pensions committee, and his staff wrote the draft.  By all reports, however, Chairman Kennedy’s health is preventing him from being heavily involved in the drafting.  Senator Reid has designated Senator Chris Dodd (D-CT) to supervise the process, but as best I can tell, it’s really the Kennedy committee staff who are making most of the key decisions.  For now I will call it the Kennedy-Dodd bill.

As the committee staff emphasized to the press after the leak, this is an interim draft.  I assume things will move around over the next several weeks as discussions among Senators and their staffs continue.  This is therefore far from a final product, but it provides a useful insight into current thinking among some key Senate Democrats.

Here are 15 things to know about the draft Kennedy-Dodd health bill. …

Michael Barone wonders if socialized medicine will be an easy sell to Obama’s voters.

… the segment of the electorate that did most to produce the Obama victory and give the Democrats large majorities in Congress is the least concerned and least informed about health care. That segment is the 18 percent of voters under 30. Young voters preferred Obama to John McCain by a 66 to 32 percent margin, according to the exit poll. Voters 30 and over preferred Obama by only a 50 to 49 percent margin. Some 63 percent of the young voted Democratic for House of Representatives. Only 51 percent of the rest of Americans did so. Without the young, the votes would clearly not be there for what the Democrats are trying to force through.

But what do the young know or care about health insurance? They have the fewest medical problems of the whole population. Their image of health care, at least until they become pregnant and have babies, is university health services. …

John Stossel reminds us of the power of markets; even in the field of health care.

… the doctors have mastered the anti-free-market sneer: Markets are good for crass consumer goods like washing machines and computers, but health care is too complicated for people to understand.

But that’s nonsense. When you buy a car, must you be an expert on automotive engineering? No. And yet the worst you can buy in America is much better than the best that the Soviet bloc’s central planners could produce. Remember the Trabant? The Yugo? They disappeared along with the Berlin Wall because governments never serve consumers as well as market competitors do.

Maybe 2 percent of customers understand complex products like cars, but they guide the market — and the rest of us free-ride on their effort. When government stays out, good companies grow. Bad ones atrophy. Competition and cost-conscious buyers who spend their own money assure that all the popular cars, computers, etc. are pretty good.

The same would go for medicine — if only more of us were spending our own money for health care. We see quality rise and prices fall in the few areas where consumers are in control, like cosmetic and Lasik eye surgery. Doctors constantly make improvements because they must please their customers. They even give out their cell numbers. …

Byron York writes on Washington’s preparation for the health care debate.

It’s hard to tell whether this meeting, at a La Madeleine restaurant in a sprawling shopping-center complex just outside Washington, is the start of a historic movement or just a strangely wonkish group-therapy session.

About 20 people from Northern Virginia have come to this faux-rustic French café on a Saturday morning to discuss health care reform. That alone makes them unusual; after all, there are a lot of other things one could be doing to begin the weekend. But they have answered the call from Organizing for America (OFA), which is basically the 2008 Obama campaign operating under a new name.

“This is the political issue I care about most, apart from the war,” declares one woman, who says she was born and raised in Canada and favors a Canadian-style, single-payer health care system for the U.S. …

Jay Cost in Real Clear Politics Blog examines the possible DC reception for health care overhaul.

Like any theoretical model, this simplifies reality a great deal. The real world is much more complex (we’ll bring in some of these complexities tomorrow). Nevertheless – this model’s explanatory power is quite great.

First, it helps explain why major legislative overhauls often fail. You can appreciate this yourself by playing around with different status quos and alternatives. Generally speaking, when the status quo is somewhere in the middle of the policy spectrum, it is extremely difficult to defeat it. Somebody – be it the president, the veto pivot, the median voter, or the filibuster pivot – will usually prefer the status quo to a given alternative.

Second, it helps explain why policy changes – when they happen – tend to be incremental. Again return to the above graph and play around with different scenarios. When you find an alternative that can beat the status quo, you’ll probably note that it does not upend the world by that much.

Nevertheless, it does allow for major policy overhauls – like what we saw during the New Deal or the Great Society. What matters is the arrangement of the key players’ preferences relative to the status quo. When preferences are relatively homogenous, and there is enough distance between those preferences and the status quo – significant changes in public policy can occur.

Rich Lowry writes on the laughter greeting Geithner in China. If the health care bill passes, there will be lots more laughing at our credit throughout the world.

Treasury Secretary Timothy Geithner wasn’t playing for yucks when he visited China last week. But when he told students at a Chinese university that China’s assets in the U.S. are “very safe,” the audience burst out in laughter.

The Chinese own so much of our debt, they have a keen interest in U.S. fiscal probity, and apparently they take a dim view of our ability to achieve it. The mandarins of a notionally communist government are now forced to harangue the world’s emblematic capitalist country about its ever-spiraling public debt. Mao Zedong and John D. Rockefeller must be spinning in their graves, at an equal rate though in different directions.

The students didn’t even titter at Geithner’s most hilarious line of all: that America is going to control the cost of government by creating an expansive new government health-care program. Heretofore, a Ted Kennedy–supported health-care reform that will cost at least $1.5 trillion over ten years would have been considered new spending, plain and simple. That was before the advent of Barack Obama and of fiscally prudent overspending. …

You can laugh more reading about late frosts in Canada and June snow in Western North Dakota.

Click on WORD or PDF for full content

WORD

PDF