James Pethokoukis

Politics and policy from inside Washington

Obama needs a new healthcare plan, not a new speech

September 9, 2009

Crazy — at least according to a snarky definition — is doing the same thing over and over and expecting a different result.

By that measure, President Barack Obama looks as if he’s going to indulge his crazy side tonight when he once again reiterates his core principles for healthcare reform, in his 122nd speech on the subject.

Now there may be a bit more detail (a public option trigger? tort reform?), a bit of different language and perhaps a more strident tone, but no one should expect a bold departure. And maybe not a different result, either.

Obama has to reassure:

- more independents that ObamaCare isn’t a budget buster

- more seniors that Medicare won’t get slashed

- more liberals that reform without an immediate public option is still worthy of being called reform, and

- more members of the middle class that the risk of inaction outweighs the risk of change to a health insurance system with which they’re kind of satisfied.

(The president’s support among indies and old folks, in particular, has been in free fall.)

That’s a lot of reassuring still to do for speech No. 122.

Maybe what’s going on here isn’t mild political insanity but rather quirky irrationality identified by behavioral economists as “anchoring.” Once people anchor to an idea or a belief, that becomes the metric by which they analyze competing ideas or beliefs.

Indeed, the president and many congressional Democrats seems to be anchoring to existing outlines for reform and ignoring competing ideas that could actually gain broader political support and work more efficiently.

Take the 166-page Healthy Americans Act sponsored by two senators, Oregon Democrat Ron Wyden and Utah Republican Robert Bennett. It reads as if it were designed by a bunch of centrist economists rather than by lobbyists representing unions, activist groups and healthcare companies.

It would do a lot of the stuff many Republicans and Democrats agree on, such as mandating everyone buy insurance and requiring insurance companies cover everyone.

But it would also scrap America’s weird employer-based healthcare system by giving individuals a big tax deduction so they could buy their own insurance from private companies.

Of course, many conservatives would hate the increase in regulations and government involvement, while liberals would loathe the absence of a public option that could one day lead to a single-payer system.

But it seems like a plan that Americans could understand intellectually and accept ideologically. It seems like the kind of plan that Americans would expect from the centrist president they thought they voted for.

Time for that guy to let go of the anchor and try a new plan. If speech No. 122 goes as well as the previous 121 in capturing moderate Democrats and independent voters, Obama may have no other choice.

Comments

This Baucus guy is voting himself right out of job. He needs to leave healthcare reform to those who know what they’re doing, and just stick to whatever they do in his home state.

Posted by Frank | Report as abusive
 

Weird. Now that word really jumped out.

I don’t see our system of employer-provided TAX-FREE med/dent benefits as ‘weird.’ I see it as a productive exchange of value in the wealth- and job-creation cycle. Think about it: You get the ‘weird’ employer-provided TAX-FREE med/dent benefits from your employer by going to work everyday and adding value and creating new wealth. In European and Scandinavian countries the med/dent insurance is provided by the governments through heavy ACROSS THE SPECTRUM taxation, and one receives the med/dent insurance from the government just because, loosely-linked to the actual wealth-creating cycle — as driven by increasing gainful employment.

That’s like having an engine in your car, but a very loose and sloppy transmission, with only one or two forward gears no less. Half the power output of the engine is wasted grinding gears in first and second and constantly burning tranny fluid in terms of national wealth generation and new job creation. Then after you grind gears and burn tranny fluid, your engine temp light comes on. After that, your check-engine light comes on. And after that, guess what, you’re out pushing your car instead of driving it. So all told it takes you twice as long to get somewhere (wealth-generation and new job creation) and you burn twice the gas and you have expensive repairs along the way. And such is a constantly-downward spiral in terms of new job creation and wealth generation.

What IS weird is how the underlying full-employment problem is so conveniently (and suspiciously) ignored by Baucus and Barack in their med/dent insurance-reform proposals. If the current 10% (way underestimated) unemployment rate was cut to 4% (actual), a few million more could be knocked off the mythical ’46 million’ uninsured rolls, through employer-provided TAX-FREE med/dent insurance. Given the jobless economic recovery under way, it seems Baucus and Barack are in a desperate race to the bottom to get ahead of the rest of us to maintain their privileged status with the rapidly-deteriorating status quo.

By ah, you say, rising costs of med/dent procedures are crippling our competitiveness and hindering the ability of companies to provide TAX-FREE med/dent insurance. Yes, that is EXACTLY true! And that brings us full-circle back to the current Baucus and Barack situation — med/dent insurance reform that doesn’t address rising costs of med/dent services themselves — only trying to insure against those rising costs, on top of not addressing the real, underlying unemployment problem. That’s like trying to build on swamp ground, twice over.

Secondly what IS weird — and a good (actually bad) example of ‘anchoring’ — is how so many see TAX-FREE as a negative thing. That is a testament to how effective the Baucus and Barack PR campaign has been. They, the feds, are playing good cop/bad cop. Last year, bad-cop McCain campaigned outright on taxing TAX-FREE employer-provided med/dent insurance benefits. That didn’t fly. So now good cop, Baucus and Barack, are trying the obfuscating end around to eliminate TAX-FREE employer-provided med/dent insurance benefits — in increments, like eating an elephant one bite at a time.

I’m glad the vacuity of yet another speech by the Barack half of Baucus and Barack was recognized in this blog. In the end though, it’s all about asking the right questions, and demanding truthful answers. The questions that should be asked of Baucus and Barack with regard to their med/dent insurance proposals are:

Cut to the chase, what are the FINES in your proposals?

Cut to the chase, what are the PENALTIES? and,

Cut to the chase, what are the additional TAXES, FEES, and ‘CONTRIBUTIONS’?

Yes, there are FINES, PENALTIES, TAXES, FEES, and ‘CONTRIBUTIONS’ in all things Baucus and Barack. And guess what? To sell the package, all those are LOW-BALLED. If a starting $750 annual fine does not get enough individuals without med/dent insurance to buy such, what do you think would happen next? The FINE would be increased. Get real — the FINE would increase to an amount greater than the rising cost of med/dent insurance, and KEEP increasing year after year to ensure you would comply with the Baucus and Barack Borg. The most ominous thing is that the income tax code could be warped yet again now to suit Baucus and Barack. An individual’s combined standard deduction and personal exemption was $8,950 last year. Perhaps in addition to a FINE, you would also lose part or all of that as well.

So if anyone still thinks our system of employer-provided TAX-FREE med/dent insurance is ‘weird’, think also of how ‘weird’ it would be to start a new, profitable, employment-providing business if on top of everything else we had a European/Scandinavian-type med/dent insurace environment. Particularly think about how much extra overhead — on top of unaddressed rising costs of med/dent services — you would have to cover before you even came close to just breaking even.

Posted by dom youngross | Report as abusive
 

dom youngross wrote:

I don’t see our system of employer-provided TAX-FREE med/dent benefits as ‘weird.’ I see it as a productive exchange of value in the wealth- and job-creation cycle. Think about it: You get the ‘weird’ employer-provided TAX-FREE med/dent benefits from your employer by going to work everyday and adding value and creating new wealth.

Dom,
Many employers sit in the air conditioned comfort of their offices and offer no benefits whatsoever. When the EMT’s wheel out one of the fallen from the production floor the business owner feigns concern while admonishing his lieutenants to protect him from liability and or blame. As far as creating new wealth,, it’s created alright, by workers whose parking place doesn’t contain a $90,000 car. I don’t envy wealth,, I just hate an uneven playing field.

Posted by RH Pyle | Report as abusive
 

EVERYTIME OBAMA USES THE 47 MILLION UNINSURED AMERICANS NUMBER HE LIES. THE NUMBER INCLUDES ILLEGAL IMMIGRANTS.

45.7 Million Uninsured Breakdown
——————————————–
Illegal Immigrants = 9.3 million
Medicad Undercount = 6.4 million
Medicaid/SCHIP Eligible = 4.3 million
Childless Adults = 5.0 million
Over 300% of Poverty = 10.1 million
Remaining Uninsured = 10.6 million

Medicad Undercount – People who are on one of two government health insurance programs, Medicaid or S-CHIP, but mistakenly (intentionally or not) tell the Census taker that they are uninsured.

Medicaid/SCHIP Eligible – Eligible for free or heavily subsidized government health insurance (again, either Medcaid or SCHIP), but have not signed up.

Childless Adults – Adults between ages 18 and 34 and without kids.

Over 300% of Poverty – Do not fit into any of the above categories, and they have incomes more than 3X the poverty level.

Remaining Uninsured – U.S. citizens, with income below 300% of poverty, not on or eligible for a taxpayer-subsidized health insurance program, and not a childless adult between age 18 and 34.

*NOTE: THIS INFORMATION IS FREELY AVAILABLE ON THE CENSUS WEBSITE.

Posted by xinunus | Report as abusive
 

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