Wednesday, August 26, 2009

Bound in shallows and in miseries

There is a tide in the affairs of men.
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
(Julius Caesar Act 4, scene 3, 218–221)

Megan McArdle quotes Clive Crook:

I think Obama needs to drop the public option, despite the dismay this will cause among progressive Democrats, and he needs to be honest about the need to raise taxes to pay for universal coverage.

McArdle then says:

I disagree about the tax increases. It is entirely true that taxes will need to go up to pay for this--all of the proposals on the table seem to be "revenue neutral" only if you squint hard and ignore the year after the 10-year deficit horizon. But Obama cannot say so. If he did, it would doom the reform. And it wouldn't do much for his re-election chances, either.

McArdle is almost certainly right: there may never have been a time when Obama could have talked about raising taxes to pay for universal coverage - and if there ever was such a time it’s long gone now. However seven months ago Obama could have made an argument for universal coverage without raising the specter of raising taxes:

I know we are facing tough economic times and I know many people will say the last thing we should be thinking about is spending more money. But all those Americans without access to our great American health care system shouldn’t have to wait any longer. And all those Americans who still have their jobs and health insurance but fear they’ll lose both tomorrow or next week or next month should know that even if they lose their jobs they and their families will still be able to get medical care when they need it.

I’ve made no secret of my belief that our health care system needs a complete overhaul and I plan to get that overhaul done before the end of my first term. But what’s urgently needed now is a safety net for those who don’t have one today - and for those who may not have one tomorrow.

Therefore I am sending to Congress the Insuring The Uninsured Health Care Bill. This bill provides that every American who wants to can buy into the Federal Employees Health Benefits Plan.* If an individual or a family can’t afford to do that then the Federal government will subsidize them.

This plan will cost $165 Billion a year**. Yes, that’s a lot of money especially at this difficult financial time. But we just spent $800 Billion to bail out Wall Street; surely we can spend half that amount to insure our neighbors - and maybe someday ourselves. You know there’s a $780 Billion stimulus package under consideration. I propose to allot half that stimulus money to Insure The Uninsured. That $390 Billion will pay for a little over two years of the program. Those two years will give us time to look at ideas for overhauling the entire system and give us time to make sure we can pay for that overhaul.

I know there are those who will argue about whether this is the best use of our resources at this critical juncture. I believe it is our moral duty to help those who most need our help when they need it most. I’m sure that this great country will demonstrate once again the incredible generosity we’ve so often shown in the past and do the right thing for everyone in America.

I think that would have been utterly saleable seven months ago. I certainly would much rather have spent some of the stimulus on subsidizing health insurance rather than on whatever it is we spent it on. Today, though, I don’t think a speech like that - even if we could use still unspent stimulus money to fund the insurance - would convince a single person. It would sound like - and be - just one more spin cycle.

And we must take the current when it serves,
Or lose our ventures.


* This is the plan I’ve written about so it’s the one I put in the hypothetical speech but there are other ways to accomplish the same thing: let everyone who wants to join Medicaid and charge a premium to those who can afford to pay something; give people money and let them buy whatever insurance they want. However we did it the first priority should have been to insure the uninsured; bending curves and centralizing information and everything else should have waited.

** This is my worst case estimate. The Gorgomons think you can do it for between $24.8 and $33.6 Billion per year. I think their estimate of the uninsured we’d have to cover is low: they figure 12 Million; I figured 20.2 Million. If I use my estimate of the number of people to cover with their policy costs I come up with between $42 and $57 Billion per year. Even using the latter numbers that $780 Billion stimulus would have paid for between 13 and 18 years of coverage.

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