Sunday, September 06, 2009

Getting thrown under the bus by a really nice guy

Okay I really want to break this down because I think it's an important case study in how our political system really works.

1. By all accounts Barack Obama is a decent guy. Smart, caring, compassionate, well-organized, able to hold a range of opposing views. Obama is exactly the kind of guy one would want as President.

2. The evidence suggests that Barack Obama is about to completely throw the American people under the bus by abandoning the public option in the health care bill (if he hasn't bargained it away already). To abandon the public option is a violation of everything he stands for. It would break a campaign pledge. It would abandon the most cherished Democratic Party goal of the last 50 years at precisely the time when it has the best chance of being enacted. And it's completely irrational -- it is impossible to hold down health care costs without a Medicare for All type public option. Most importantly perhaps, it represents a moral failing to protect the most vulnerable in our country from needless suffering and death (as Peter Singer argues, 'If it is within your power to save a life, you also have a moral obligation to do so.')

It would be easy then to collapse this situation down into one pole or the other. Either:
  1. 'Obama really is a great guy and we just don't understand the complexities of passing a bill'; OR
  2. 'Obama is a liar who always intended to sell us out.'
But let's walk through the implications of the health care bill for a second.

One of the fascinating things about the health care bill is how often members of Congress admit openly that if a real public option was attached to the bill, that it would lower costs too much and be the end of private insurance in this country. And they say that like it's a bad thing. At first the notion that private insurers would go out of business seems silly. As Obama argued in his last press conference:

Why would it drive private insurance out of business? If private insurers say that the marketplace provides the best quality health care; if they tell us that they're offering a good deal, then why is it that the government, which they say can't run anything, suddenly is going to drive them out of business? That's not logical ....

But then, you start to look at the numbers as I did in my last post. Private health insurers make about 30% profit for holding your money in reserve until it is needed to pay for medical bills. As David Waldman pointed out: "Insurers don't provide care. They just finance it. Why are we supposed to be happy paying 30 points on that deal (to private insurers) when Medicare takes just 4?"

And then it all makes sense.

If there were a real public option, private insurers, over time, indeed would go out of business.

I happen to think that's a good thing, a really good thing.

Private insurers provide nothing of value. They don't have the leverage or negotiating power that a Medicare for All government type program would have. And their accountants don't actually look for efficiencies, they just look for technicalities to fuck you so that they can profit from your pain. And for all of that, they pocket 30 cents on the dollar versus the 4 cents on the dollar that Medicare charges for administrative overhead. Private insurance then is a pure mafia-style racket to take money from people in return for "protection services" that are never really provided (or rather the financial services that they provide are marked up an exorbitant 30% over their actual costs).

So if there were real competition, people would naturally chose the fairer program with the larger negotiating power and 4% overhead over the more expensive, less efficient, private plan. Medicare For All would in fact become Medicare for all, a de facto universal health plan just on the basis of the fact that it is A BETTER PRODUCT AT A LOWER COST than the private plans.

Which brings us back to Obama. As Obama himself has argued, the only way to insure competition and lower cost is through a public option. So if it's logical, if it is indeed in the public interest, then why is Obama about to walk away from it?

Because private health insurance is a trillion dollar a year industry (that's trillion with a T). And Obama doesn't have the stomach to take out a trillion dollar a year industry. He just doesn't have it in him. Mr. Consensus is no Huey Long.

So it is true, logical, and rational to argue that a public option was the best way to control costs (which is what Obama did during the campaign). But it is also true that a trillion dollar a year mafia racket can hire a lot of lobbyists and buy a lot of TV time during elections (and everybody in D.C. knows it). Indeed private insurers will spend every last penny they have stolen from us to protect their profitable scheme.

Obama the post modernist wants to have it both ways -- a public option for the American people while preserving the jobs (and profits) of private insurers. The problem is, health care is largely a zero sum game -- what's good for the American people is bad for private insurers and vice-versa. And in trying to have it both ways, Obama's message comes out as convoluted, confused, and lacking in moral authority (because it is).


The Completist said...

Amen. To further back up your example, note these far from third world countries

RFK Action Front said...

Great list!!! Really eye opening. Thanks for the info.

Isa Lube said...

Not sure it will wrk out or not since other nations under same type of system say it's should be more restrained so not just anyone can get access from hard working tax payers dollars??? I don't want anyone to take food out of my mouth and give it to someone who is sitting around doing nothing-or should you/I???

RFK Action Front said...

Hi Isa:

Thanks for the comment.

It seems there are a lot of assumptions/ generalizations packed into your two sentences. Aren't there hardworking people who don't have coverage, or who DO have coverage, only to get canceled by private insurance when they get sick?

"A recent study found that 62 percent of all bankruptcies filed in 2007 were linked to medical expenses. Of those who filed for bankruptcy, nearly 80 percent had health insurance." Himmelstein, D, E., et al, “Medical Bankruptcy in the United States, 2007: Results of a National Study, American Journal of Medicine, May 2009.

Also, you seem to see health care from a scarcity mentality ('a dollar spent on health care is a dollar taken out of your pocket'). But in fact, universal health care would likely be stimulative for the economy -- healthy people work more days, start more businesses, and pay more taxes -- REDUCING the OVERALL tax burden on society (and perhaps on you too).

So, interesting opinions. But no, I don't think they are supported by the facts.