George Will:
Competition from the public option must be unfair because government does not need to make a profit and has enormous pricing and negotiating powers. Besides, unless the point of a government plan is to be cheaper, it is pointless: If the public option conforms to the imperatives that regulations and competition impose on private insurers, there is no reason for it.
Believe it or not, Will is actually using this point to attack a public option. Yet he never explains why cheaper health insurance is a bad thing.
(Will also explains away the nation's 45 million uninsured as a "'snapshot' of a nation" where workers often change jobs. That is, to Will, these folks are only temporarily uninsured. Of course, temporarily uninsured or no, it's still a financial kiss of death for these folks to be ill...not to mention that insurance companies use this "temporary" period to ensure they don't pay claims when they are insured, thanks to the ol' pre-existing condition clause...)
IMHO, that's the essential difference between a contemporary conservative and a progressive: a George Will conservative will always oppose something based on theoretical grounds, even if the proposal in question will actually improve things. A modern progressive is pragmatic. If having a government-run health insurance option means cheaper health insurance...let's have it!
As Nate Silver points out, there aren't many goods or services that government provides better than the private sector. But the insurance racket is unique:
he profits the insurance industry is making, of course -- profits artificially boosted by an enormous backdoor tax subsidy -- don't seem to be buying the customer much of anything in terms of improved service or cost savings. On the contrary, health care costs are rising by as much as 9-10 percent per year, without any concomitant increase in the level of service. If JetBlue were raising the cost of its fares by 10 percent per year, they'd be out of business.
The reason the insurers are staying in business, though, is because barriers to entry in the health insurance industry are in practice quite high. Insurers benefit from pooling risk. The larger the pool, the better in terms of the insurer's ability to hedge its risk and build negotiating leverage with its providers. That makes it very difficult for a Five Guys or a JetBlue type of start-up to compete: they'll have trouble getting together enough customers to pool their risk adequately, and even if they do, they won't have as much negotiating leverage as the big guys. Health care providers may demand a better deal or refuse to accept them. As such, they'll never get off the ground.
Insurance, in other words, is a volume business, the main requirements for which are that (1) you have a lot of money pooled together and that (2) you've been around for awhile.
I'd also add that insurers increase profits, not by streamlining the production of insurance or making it with cheaper materials, but by decreasing the amount of claims they pay out. That is, private insurance is only bound to get worse...for consumers, that is. So you have an industry whose nature prohibits new competition, and the existing players one up each other by providing an increasingly worse product to their customers.
Whatever. A public option, if robust enough, would probably provide better coverage at a cheaper rate than current private plans. Plus it'd be portable, allow small businesses to compete for workers with larger companies, and encourage entrepreneurship.
To blithely label this as an argument of "capitalism" versus "socialism" ignores the myriad flavors of capitalism. If your flavor of capitalism must needs be an economic system dominated by monolithic multinational corporations, you're probably against the public option. If, on the other hand, you prefer a system where small, local businesses and the self-employed thrive alongside (or, better yet, dominate) big corporations, you probably support the public option.
So it's good to see that Obama today say that a public option is "non-negotiable." Ezra:
There were two ways he could have responded to the press corps' queries. The first would be a procedural reply: "All ideas are on the table," or something of that nature. But that wasn't his approach. Instead, he defended the plan's substantive merits. His answer was, in other words, an effort at persuasion rather than diversion. The implication was that he, at the least, is genuinely convinced by the case for a public insurer.
It's also smart politically, as well as policy-wise. And now - finally - there's signs in Congress that a public option will be a part of reform. The question now is, what will it look like?
Kent Conrad, for example, has moved away from his idea of small co-ops towards a coalition of co-ops that could negotiate health care prices as a single, national body, which is becoming ever closer to a public option. And even Conrad had his "wake-up moment" about GOP Senators: when the Republicans feared a public option because it would be competing unfairly as a subsidized body, they still didn't like it when the idea of a co-op without a subsidies was suggested. "They really don't want a competitive model," admitted the North Dakota Democrat, "at least some of them."
As dday pointed out, Democrats are now realizing that, "...like in 1993, (the Republicans') mission is to kill health care reform, period. Why Why anyone would think that any alternative would be true is beyond me, but Senate Democrats obviously needed to play Tic-Tac-Toe with the computer endlessly until they realized what a strange game it all is, and that 'the only winning move is not to play.'" Apparently some Democrats had considered "nixing" the public option in hopes that they would find Republican support for reform.
But now I think Democrats are realizing they own health care reform. They no longer have any incentive, or reason, to find common ground with Republicans. There can be none. And if the push for reform fails, it will be seen as a Democratic failure. The sooner Congessional Democrats realize this, the better. And if they do band together and implement a Democratic health care reform bill, they might actually realize they are the majority power and are calling the shots. This health care reform could be the issue Democrats...well...start acting like Democrats And it's long past time for them to start acting in concert in DC. Who knows? This could be the start of a beautiful friendship... |
