Don’t Take the Bait

By Greg Scandlen

Now that ObamaCare is failing, the Democrats are trying to turn the argument around. “At least we tried,” they say, “what have the Republicans done?” Then they offer two options: 1. Let the states do their own thing, but only if they can cover as many people with as comprehensive benefits for less cost, or 2. Let the Republicans offer an equally comprehensive federal program.

Republicans should resist falling into that trap.

Democrats love to enact “comprehensive” programs that “guarantee” this, that, or the other. Problem is that the “guarantee” isn’t worth a bucket of warm spit.  The examples are legion and I won’t list them here. Let’s just say, the programs never help as many people as promised, never come in within budget, often make conditions worse for most people, and block market-based changes that might have actually worked.

After their programs have failed to do what they promised, the response is always, “Yes, but think how many people we’ve helped. If you take it away, those people will perish.”  Even the much-vaunted Medicare program is like that. Only about half the elderly needed help when it was enacted, but now 100% of the elderly are dependent on it. This dependency is a very big problem, and Republicans have a hard time dealing with it.

Writing in the Washington Post, Ezra Klein dares Republicans to “take a stand on health-care reform.”  He writes:

To understand the trouble the Republicans find themselves in, you need to understand the party’s history with health-care reform. For much of the 20th century, Democrats fought for a single-payer system, and Republicans countered with calls for an employer-based system. In February 1974, President Richard Nixon made it official. “Comprehensive health insurance is an idea whose time has come in America,” he said, announcing a plan in which “every employer would be required to offer all full-time employees the Comprehensive Health Insurance Plan.”

This is true, but Richard Nixon was hardly an advocate of market-based solutions. This is the same president who instituted wage and price controls for the entire economy in an effort to control inflation. It is Nixonian thinking that gets Republicans in trouble every time.

Many Republicans are still subject to this kind of thinking. Mitt Romney and the Heritage Foundation got RomneyCare enacted in Massachusetts, and even today Klein writes of the Wyden-Brown proposal to allow state waivers:

The law envisions the secretary of Health and Human Services handing out the waivers, while the Heritage Foundation’s Stuart Butler would prefer to see a bipartisan commission in charge.

Here is precisely the kind of Nixonian thinking that Stuart Butler is famous for – continue having Washington dictate the terms of surrender, but put decision-making in the hands of a commission of elites rather than the Secretary of HHS.

Look, let’s be honest, when you’re dealing with markets, you can’t make guarantees. All you can do is get the incentives right, and watch things unfold.  Most of the time entrepreneurs come up with ideas that no one ever considered before. They can’t prove the merit of the idea ahead of time, and many ideas will fail. But the ones that succeed will add tremendous value and productivity, beyond all expectations.

It is amazing that we should even have to make this argument in these days of explosive innovation.  Think of all the efforts that were going into Internet search engines just ten years ago before Google came along. Think of Apple with and without Steve Jobs.

The main thing we have to do to reform health care is get the rusty old bureaucracy out of the way, and enable innovators and creators to operate with maximum freedom. It can’t be dictated by the Secretary of HHS or by a bipartisan commission, either.

How can we present this vision in a politically palatable way? Ezra Klein will never be convinced, and neither will Stuart Butler, but most of America knows instinctively that health care is still in the horse and buggy stage and we are well overdue for explosive innovation.

The last thing Republicans should do is try to find a better way of making buggy whips.

 

 

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4 Responses

  1. Greg,
    You are so right. Nixon was anything but a free marketer. His need to be liked, which ultimately failed utterly, convinced him that big government was the answer.
    Did he not read nor understand history? Calling him a conservative Republican is like calling Obama a moderate Democrat!
    This is a trap if the R’s want to be liked. It never works for them in the beltway or anywhere else.
    Thanks for your continuing good analysis.

  2. You are right on Greg. It’s hard to imagine anyone taking Obama’s “compromise” offer seriously. Forget that the idea of states inacting the federal program individually would lead us to the same ultimate result (single payer). It seems that some don’t understand that government run healthcare is still government run healthcare, regardless of whether it is done through the states or the federal government. Duh!!!

  3. Greg you’re right as usual. Top down never works. The problem is CPT codes. Changing the name to ICD9, ICD 10 isn’t the solution, it only gives the AMA Cartel more revenue, and increases costs even more.
    Physicians need ot set their own rates like htey do at http://www.medibid.com, it’s really that simple. Meanwhile we are shipping patients overseas along with manufacturing, and computer programing.

  4. A younger Paul Krugman once said that the job of an economist in the government is akin to flushing cockroaches down the toilet. If you don’t keep flushing, the bad ideas come back up.

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