Tag: Medicaid

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Barack Obama Domestic issues Fiscal Crisis Politics The Opinionsphere

Paul Ryan’s America

 

[reddit-me]Paul Ryan launched an attack on Barack Obama’s deficit speech last week — calling it “excessively partisan.”

Which is interesting considering his own approach to the budget deficit which he called “an existential threat to all we hold dear”: Balance the budget without offending a single Republican.

Over a year ago, I described the conundrum Republicans faced as the deficit they were fuming against was largely a result of policies that benefited their own constituencies. Those over 55 who were the only demographic group to vote Republican (even in the Democratic wave years of 2006 and 2008) benefited the most from the trillion dollars spend on Medicare and Social Security. Our military spending nearly matched the rest of the world’s combined — and if you include other national security spending — totaling another trillion. And then there were the various tax incentives and loopholes for big corporations adding up to another few hundred billion dollars. Further, Republicans were committed to not raising taxes on anyone — especially the richest.

Paul Ryan was faced with the unenviable task of squaring this circle. In an effort that nearly everyone described as “serious,” Ryan managed to put forth a plan with no prospect of passing at all — and one that managed to place the entire burden of balancing the budget on the backs of Democratic constituencies. The military was left alone. The base of the Republican party and driver of most of the debt — the elderly — was left alone. Corporations were rewarded with a lower tax rate with some vague talk of eliminating their enormous tax subsidies.

Though Ryan kept saying the pain of balancing the budget would be shared by everyone — his plan was really about cutting off support for those left behind in our society. The rich and elderly were rewarded — even as they accumulate more and more of the nation’s wealth; the middle class were mainly left alone; and the young and the poor were cut off.

That doesn’t sound like the path to a dynamic and prosperous society to me.

Paul Ryan’s future is one where my generation must be prepared to support our parents as they become the test subjects in the biggest social experiment in history: As Medicare becomes a voucher program growing at much lower than the rate of health care inflation, in the hopes that this will slow it down. Meanwhile, my generation must be saving more than any generation in history as we prepare to pay for our own medical costs.

Ryan’s plan is many things:  If taken seriously, it is an attack on all non-Republican constituencies. If implemented, it would be a grand ideological experiment that barely considers the lives of those it would affect which Republicans would normally call “social engineering.”

But most of all, the Ryan plan is (as Slate‘s John Dickerson said in Friday’s Political Gabfest), a “bold negotiating position.”

[Photo courtesy of Gage Skidmore licensed under Creative Commons.]

 

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Health care

Krugman Summarizes the Health Care Problem

While researching a few facts about health care, I came across this excellent Paul Krugman article on health care in the New York Review of Books from 2006. Anyone who wants a good overview of the debate should check out the article in full – but here are a few highlights.

Krugman sees the growth of health care costs as being driven by new technology but exacerbated by aspects of our private system. He includes this informative graph to demonstrate the significance of health care spending:

He points to a study which quantifies the difference in spending between private and public health care plans:

For example, a study conducted by researchers at the Urban Institute found that

per capita spending for an adult Medicaid beneficiary in poor health would rise from $9,615 to $14,785 if the person were insured privately and received services consistent with private utilization levels and private provider payment rates.

He points to another study which tracked the changes in the growth of spending in Medicare and private insurance:

Comparing common benefits, says the Kaiser Family Foundation,

changes in Medicare spending in the last three decades has largely tracked the growth rate in private health insurance premiums. Typically, Medicare increases have been lower than those of private health insurance.

He makes a good point (with his wry wit) about the fragility of Medicaid:

Unlike Medicare’s clients—the feared senior group—Medicaid recipients aren’t a potent political constituency: they are, on average, poor and poorly educated, with low voter participation. As a result, funding for Medicaid depends on politicians’ sense of decency, always a fragile foundation for policy.

Krugman also points out yet another study which demonstrates how a market-based approach does not necessily lead to better health results – or even cheaper results – as bad choices in the short-term often lead to expensive treatments in the long-term:

A classic study by the Rand Corporation found that when people pay medical expenses themselves rather than relying on insurance, they do cut back on their consumption of health care—but that they cut back on valuable as well as questionable medical procedures, showing no ability to set sensible priorities.

Finally, Krugman continues to make the case that our health are system is simply not the best one out there:

The data in Table 1 show that the United States does not stand out in the quantity of care, as measured by such indicators as the number of physicians, nurses, and hospital beds per capita. Nor does the US stand out in terms of the quality of care: a recent study published in Health Affairs that compared quality of care across advanced countries found no US advantage. On the contrary, “the United States often stands out for inefficient care and errors and is an outlier on access/cost barriers.”

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Barack Obama Domestic issues Financial Crisis The Opinionsphere Videos

Obama’s Grand Bargain

[digg-reddit-me]From Obama’s Inaugural Address:

There are some who question the scale of our ambitions — who suggest that our system cannot tolerate too many big plans. Their memories are short. For they have forgotten what this country has already done; what free men and women can achieve when imagination is joined to common purpose, and necessity to courage.

What the cynics fail to understand is that the ground has shifted beneath them — that the stale political arguments that have consumed us for so long no longer apply. The question we ask today is not whether our government is too big or too small, but whether it works — whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified. Where the answer is yes, we intend to move forward. Where the answer is no, programs will end. And those of us who manage the public’s dollars will be held to account — to spend wisely, reform bad habits, and do our business in the light of day — because only then can we restore the vital trust between a people and their government.

This brings to mind what George Stephanopoulos was so excited about last Sunday on This Week:

(Yes, I need to work on improving my DVR to computer quality.)

It seems that Obama is preparing to bet his presidency on a Grand Bargain – that will allow him (and us) to rewrite the social contract in a more extensive way than any president since Franklin Delano Roosevelt. Even during Obama’s campaign, he spoke of tackling the challenges that were necessary – and not putting off hard discussions about our country’s long-term stability. But the financial crisis – which at first prompted the endlessly parroted conventional wisdom that whoever won would need to cut all of their projects and focus narrowly on the crisis itself – has instead proved to be an opportunity.

The amount of spending needed to stimulate the economy is enormous – with the numbers being thrown around today dwarfing that of any previous government intervention (save perhaps for our major wars). What Obama understands is that this type of spending, while necessary in the short-term, poses a serious long-term threat. Which is why he is now speaking of the second step – after the financial crisis has passed – of tackling entitlement reform and tax reform, and finally putting America on sound financial footing after years of prolifigacy.

None of these insights are exceptional. What is exceptional is how Obama is already shaping the arch of his first term, using this crisis to set up his next objective, and shaping the conventional wisdom.

The problem I see though is that the Obama administration has not done a good job of conveying to the public the place this stimulus bill has within Obama’s agenda. The word is that in the next week or so, Tim Geithner will present “a ‘comprehensive’ plan that [he] hope[s] will command market confidence.” My hope is that this comprehensive plan will lay out a broad legislative agenda based on Obama’s campaign. Based on the campaign plans and signals sent during the transition, here’s what I see:

Step 1 (The First 100 Days)

  • Release the rest of the funds from TARP.
  • A large stimulus package to demonstrate the government’s commitment to addressing the crisis, especially in alleviating it’s effects on the majority of Americans.
  • A banking and mortgage bill that takes whatever steps are necessary to shore up these sectors of the economy, including new regulations, new oversight, and possibly additional funds.
  • An infrastructure bill that would create a National Infrastructure Bank.
  • Health care reforms that would extend health care benefits and attempt to control the escalating health care costs.
  • A combination of a cap-and-trade program and funding for green energy.

The goal of this first period would be to begin to make both short-term and long-term investments into those sectors that will lead to long-term growth – which will stimulate the economy in the short-term. This is the spending stage. After this burst of legislating, Obama would be able to focus on tinkering with education programs and seeing what works, as well as addressing the simmering foreign policy issues which are constantly threatening to take over the agenda.

Step 2 (Post-Crisis)

  • Entitlement reform (Social Security, Medicare, Medicaid.) Everything is on the table.
  • Tax reform. Not much has been said about this. This will certainly be a wild card – but Obama has criticized our corporate tax rate for its irrationality. It’s very high – but due to the enormous number of exemptions and credits, the effective rate for those businesses able to lobby for benefits, it is very low. This should be rationalized.
  • Universal health care.
  • Education reform.

This is the “cutting back” stage and consolidation stage. The goal of this second stage would be to put America on a solid financial footing again – to eliminate the unsustainable domestic policies that undermine our stability and power.

This is obviously an enormous agenda. And it’s far from clear that Obama can accomplish this. But if he does not lay out the vision – which I have pieced together from numerous statements – then it’s hard to see how he can accomplish it. Of course, Geithner was just confirmed last week – and Obama’s only been in office for two weeks – so he does have a bit more time to lay this out. But he doesn’t have long.

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