Health Care for All
One of the enduring objectives of the Democratic party, more especially the progressive wing of the party, has been universal health care funded by taxpayers. The proposal was first aired during the Truman administration. All of the intervening steps–Medicare, Medicaid, Hillarycare, Obamacare have been aimed in that direction. A careful review of each of the debates surrounding those bills/proposals will reveal some of the participants saying something about it. An approximation would be: This plan isn’t perfect, but it advances us along the road to the ultimate goal.
I believe that the deterioration of Obamacare, and the inability of the Republicans to come up with an alternative, are moving us a lot closer to the goal. Perhaps in the form of Medicaid for all. Currently 74 million of our citizens are covered by Medicaid. Efforts to pare that number back to pre-Obama levels are being met with massive resistance. The genius of Obama’s expansion of Medicaid to those up to 400% of the poverty level is that it is virtually impossible to scale back an “entitlement” once granted. The Republicans are trapped.
The drive for taxpayer provided healthcare for all is based on the notion that healthcare is a right. It is certainly reasonable for a modern society to decide to tax itself to provide healthcare to all its citizens, but I believe the term “right” is misused in this case. The rights guaranteed by the Constitution derive from a theory of natural law, which came to the founders via John Locke, Thomas Aquinas and Aristotle. Rights were protections citizens had from the clutches of government. Government had no right to interfere with the practice of religion, the expression of political thought, the use of private property, etc. FDR invented new rights with his Four Freedoms. This was the right to expect some service from government, in addition to national defense and domestic tranquility. We may choose to tax ourselves to provide a service, but I don’t believe it should be called a right. That term should be reserved for Constitutional guarantees of freedom.
Over time, Americans have come to expect that their medical bills should be paid for by somebody else. Inception of this concept was a total accident. During WWII, wage controls meant that unions could not negotiate for higher salaries, so they negotiated for employer paid healthcare and pensions. Private pension plans were mostly eliminated by the ERISA legislation of 1974; employer provided healthcare endured. That evolved into the notion that free medical care was a right.
The problem is tradeoffs. Economics is not comparable to physics. Its laws cannot be fully verified by controlled experiment. But one of its laws comes pretty close: the law of supply and demand. As cynical as it is to contemplate, healthcare is a service like any other service from an economic prospective. When demand exceeds supply, some form of rationing occurs. Either the price goes up to the point of equilibrium, or the available supply must be rationed by lines and/or fiat (allocation of limited amounts to those demanding the merchandise). If you are sick or a hypochondriac, your demand for medical services is unlimited, especially if someone else is paying. That’s the demand problem. The supply problem is that creative and ambitious people will not flock to work for a sector of the economy in which their compensation will be capped, and their work product minutely regulated by a government attempting to stay afloat financially. Bernie Sanders wants “Medicare for all”. Medicare for those 65 and older has an actuarial shortfall of $56,000,000,000,000 over the next 30 years. Adding 250 million beneficiaries will certainly exacerbate that problem.
If you want to know what government run healthcare looks like, we have two examples. The VA is a mess. Huge cost and poor service. Medicare works reasonably well, except that lots of doctors won’t take Medicare patients (more won’t take Medicaid) and that number is growing. In addition, at least 25% of Medicare dollars are wasted/stolen–by fraudulent billing, practitioners gaming the billing codes, and patients abusing the system.
A sneak peak at the costs can be gleaned by a recent experiment in California. The State Senate passed a bill mandating no-cost healthcare for every Californian. The price tag was estimated at $400,000,000,000 per year. Like most such estimates, surely an understatement. Half was supposed to come from existing federal programs; the other half from new taxes. Consider that the current budget for all State functions is $125 billion and you get a sense of the scope of such an endeavor.
Free healthcare for all may be an emotionally satisfying aspiration, but the implications should be considered in the cold light of reason.
