Hurray For Health Reform: “Protecting Those Who Are Falling Through The Cracks”
It’s said that you can judge a man by the quality of his enemies. If the same principle applies to legislation, the Affordable Care Act — which was signed into law two years ago, but for the most part has yet to take effect — sits in a place of high honor.
Now, the act — known to its foes as Obamacare, and to the cognoscenti as ObamaRomneycare — isn’t easy to love, since it’s very much a compromise, dictated by the perceived political need to change existing coverage and challenge entrenched interests as little as possible. But the perfect is the enemy of the good; for all its imperfections, this reform would do an enormous amount of good. And one indicator of just how good it is comes from the apparent inability of its opponents to make an honest case against it.
To understand the lies, you first have to understand the truth. How would ObamaRomneycare change American health care?
For most people the answer is, not at all. In particular, those receiving good health benefits from employers would keep them. The act is aimed, instead, at Americans who fall through the cracks, either going without coverage or relying on the miserably malfunctioning individual, “non-group” insurance market.
The fact is that individual health insurance, as currently constituted, just doesn’t work. If insurers are left free to deny coverage at will — as they are in, say, California — they offer cheap policies to the young and healthy (and try to yank coverage if you get sick) but refuse to cover anyone likely to need expensive care. Yet simply requiring that insurers cover people with pre-existing conditions, as in New York, doesn’t work either: premiums are sky-high because only the sick buy insurance.
The solution — originally proposed, believe it or not, by analysts at the ultra-right-wing Heritage Foundation — is a three-legged stool of regulation and subsidies. As in New York, insurers are required to cover everyone; in return, everyone is required to buy insurance, so that healthy as well as sick people are in the risk pool. Finally, subsidies make those mandated insurance purchases affordable for lower-income families.
Can such a system work? It’s already working! Massachusetts enacted a very similar reform six years ago — yes, while Mitt Romney was governor. Jonathan Gruber of the Massachusetts Institute of Technology, who played a key role in developing both the local and the national reforms (and has published an illustrated guide to reform) has surveyed the results — and finds that Romneycare is working pretty much as advertised. The number of people without insurance has dropped sharply, the quality of care hasn’t suffered, and the program’s cost has been very close to initial projections.
Oh, and the budgetary cost per newly insured resident of Massachusetts was actually lower than the projected cost per American insured by the Affordable Care Act.
Given this evidence, what’s a virulent opponent of reform to do? The answer is, make stuff up.
We all know how the act’s proposal that Medicare evaluate medical procedures for effectiveness became, in the fevered imagination of the right, an evil plan to create death panels. And rest assured, this lie will be back in force once the general election campaign is in full swing.
For now, however, most of the disinformation involves claims about costs. Each new report from the Congressional Budget Office is touted as proof that the true cost of Obamacare is exploding, even when — as was the case with the latest report — the document says on its very first page that projected costs have actually fallen slightly. Nor are we talking about random pundits making these false claims. We are, instead, talking about people like the chairman of the House Republican Policy Committee, who issued a completely fraudulent press release after the latest budget office report.
Because the truth does not, sad to say, always prevail, there is a real chance that these lies will succeed in killing health reform before it really gets started. And that would be an immense tragedy for America, because this health reform is coming just in time.
As I said, the reform is mainly aimed at Americans who fall through the cracks in our current system — an important goal in its own right. But what makes reform truly urgent is the fact that the cracks are rapidly getting wider, because fewer and fewer jobs come with health benefits; employment-based coverage actually declined even during the “Bush boom” of 2003 to 2007, and has plunged since.
What this means is that the Affordable Care Act is the only thing protecting us from an imminent surge in the number of Americans who can’t afford essential care. So this reform had better survive — because if it doesn’t, many Americans who need health care won’t.
By: Paul Krugman, Op-Ed Columnist, The New York Times, March 18, 2012
“The Tin Man”: Mitt Romney, The Rich And The Rest
No one should be surprised that the Tin Man has a tin ear.
After all, Mitt Romney is the same multimillionaire who joked that he was “unemployed” while he was “earning” more in one day than most Americans earn in a year and paying a lower rate on those earnings than most Americans do.
This is the same man who bragged last month that he liked to fire people at a time when nearly 13 million people are out of work and who accepted the endorsement this week of Donald Trump, who has made “You’re Fired!” his television catchphrase.
This is the same man who in November claimed that federal employees are making “a lot more money than we are.” What?! We? What we? Please direct me to the federal employees with the $20 million paychecks. In fact, The Washington Post pointed out in November that federal employees on average “are underpaid by 26.3 percent when compared with similar nonfederal jobs, a ‘pay gap’ that increased by about 2 percentage points over the last year while federal salary rates were frozen.”
And who could forget his remark that “corporations are people.” Classic.
But this week when Romney said that he wasn’t concerned about the very poor in this country, he jumped in the pickle barrel and went over the waterfall.
First, his statement:
“I’m not concerned about the very poor. We have a safety net there. If it needs repair, I’ll fix it. I’m not concerned about the very rich. They’re doing just fine. I’m concerned about the very heart of America — the 90-95 percent of Americans who right now are struggling.”
Romney went on to say that his campaign was focused on “middle-income Americans” and that “we have a very ample safety net” for the poor.
He later tried to clarify, saying that his comments needed context. Then he said that the comments were a “misstatement” and that he had “misspoke.” Yeah, right.
Where to begin?
First, a report from the Center on Budget and Policy Priorities last month pointed out that Romney’s budget proposals would take a chainsaw to that safety net. The report points out that cuts proposed by Romney would be even more draconian than a plan from Representative Paul Ryan: “Governor Romney’s budget proposals would require far deeper cuts in nondefense programs than the House-passed budget resolution authored by Budget Committee Chairman Paul Ryan: $94 billion to $219 billion deeper in 2016 and $303 billion to $819 billion deeper in 2021.”
What does this mean for specific programs? Let’s take the Supplemental Nutrition Assistance Program, since “food stamps” have been such a talking point in the Republican debates. The report says the Romney plan “would throw 10 million low-income people off the benefit rolls, cut benefits by thousands of dollars a year, or some combination of the two. These cuts would primarily affect very-low-income families with children, seniors and people with disabilities.”
Does that sound like a man trying to “fix” our social safety nets? Absolutely not. Romney is so far up the beanstalk that he can no longer see the ground.
Then let’s take the fact that a report last month by the Tax Policy Center found that his tax plan would increase after-tax income for millionaires by 14.5 percent while increasing the after-tax income of those making less than $20,000 by less than 1 percent and of those making between $30,000 and $40,000 by less than 3 percent.
For a man who’s not worried about the rich, he sure seems to want them to rake in more cash.
This has nothing to do with context. This has everything to do with a caviar candidate’s inability to relate to a chicken-soup citizenry.
Then there is the “ample safety net” nonsense. No one who has ever been on the low end of the income spectrum believes this, not even Republicans. According to a Pew Research Center survey conducted in October, even most Republicans and Republican-leaning independents who make less than $30,000 a year, which accounts for about a quarter of all Republicans, say that the government doesn’t do enough to help the poor. Only a man who has never felt the sting of poverty or seen its ravages would say such a thing.
But perhaps the most pernicious part of his statement was the underestimating of the rich and poor and the elasticized expansion of the term “middle income” or middle class. Romney suggests that 95 percent of Americans are in this group. Not true.
According to the Census Bureau, the official poverty rate in 2010 was 15.1 percent.
And that’s the income poor. It doesn’t even count the “asset poor.” A report issued this week by the Corporation for Enterprise Development found that 27 percent of U.S. households live in “asset poverty.” According to the report, “These families do not have the savings or other assets to cover basic expenses (equivalent to what could be purchased with a poverty level income) for three months if a layoff or other emergency leads to loss of income.”
On the other hand, the definition of “rich” is more nebulous. However, according to a December Gallup report, Americans set the rich threshold at $150,000 in annual income. And according to the U.S. Census Bureau 8.4 percent of households had an income of $150,000 or more in 2010.
So at the very least, nearly a fourth of all Americans are either poor or rich.
That would leave about three-fourths somewhere in the middle, but not all middle class. Tricking the poor to believe they’re in it, and allowing the wealthy to hide in it, is one of the great modern political deceptions and how we’ve arrived at our current predicament.
According to a New York Times/CBS News poll conducted last month, nearly a fifth of families making less than $15,000 said that they were middle class and nearly two-fifths of those making more than $100,000 said that they were middle class.
Romney is not only cold and clumsy, he’s disastrously out of touch, and when talking about real people, out of sorts. If only he had a heart, and if only that heart was connected to his brain.
By: Charles M. Blow, Op-Ed Columnist, The New York Times, February 3, 2012
“Compassion Deficit”: Mitt Romney, His Own Worst Enemy
If Mitt Romney has a big problem in the Republican primary, it’s himself. The former Massachusetts governor can’t seem to keep his foot out of his mouth, and has—through misstatements—portrayed himself as a cold and heartless shill for the 1 percent. Here are some of the greatest hits:
- “Corporations are people, my friend.”
- “I’m running for office for Pete’s sake!”
- “I like being able to fire people.”
- “I should tell my story. I’m also unemployed.”
When heard in their full context, most of these aren’t as bad as they sound. But, as John Kerry learned in 2004, voters aren’t that attuned to the context of politicians, especially when they say things that leave a bad first impression.
On CNN last night, Romney deepened this problem with another tone deaf comment which, fairly or not, will reinforce the image that he is a defender of the wealthy:
“I’m not concerned with the very poor. We have a safety net there. If it needs repair, I’ll fix it. I’m not concerned about the very rich, they’re doing just fine. I’m concerned about the very heart of the America, the 90 percent, 95 percent of Americans who right now are struggling.” [Emphasis mine]
It’s clear that Romney isn’t dismissing the “very poor” as much as he’s expressing confidence in the existing safety net for those mired in poverty. If that net isn’t strong enough, Romney notes, he’ll fix it as president. But the phrasing is incredibly awkward, and when voters hear this, they’ll latch on to the first sentence to the exclusion of the rest. And of course, Democrats are certain to use this in attack ads throughout the general election. Though, given Romney’s relationship with truth in advertising, that isn’t as unfair as it sounds.
It should be said that, if we go by his proposed policies, Romney doesn’t actually care much about the poor. The former Massachusetts governor has consistently voiced support for the draconian budget cuts of Rep. Paul Ryan, which would cripple the safety net and deprive low-income Americans of valuable assistance. What’s more, he plans deep cuts to taxes on capital gains geared toward the rich, who are most likely to collect income on investment. Like many on the right, his preferred economic policies would redistribute income to the wealthy, and destroy our fiscal future with a massive long-term deficit.
By: Jamelle Bouie, The American Prospect, February 1, 2012
“It’s All About Bucks,The Rest is Conversation”: Mitt Romney And ‘Envy’ Versus ‘Greed’
The 2012 presidential race is shaping up as a battle not just between candidates, but over which of the Seven Deadly Sins is most offensive to voters.
On the one side, we have envy, which GOP front-runner former Gov. Mitt Romney identified as a distasteful by-product of income inequality—or, Republicans argue, the “class warfare” provoked by Democrats. The United States “already has a leader who divides us by the bitter politics of envy,” Romney said after winning the New Hampshire primary. The line was obviously meant to undermine Obama’s 2008 pledge to bring people together, as well as to cast restless middle-class and poor people as possessing un-mannerly envy.
On the other side, however, we have greed, and that is a Deadly Sin that may haunt the eventual Republican nominee. The Occupy Wall Street movement may be dismissed (unfairly) by some as a bunch of Starbucks-sucking, whiny kids who won’t look for jobs, but it is undeniably true that a broad swath of Americans is getting more than a little resentful at the fact that the very wealthy have come through the recession quite profitably, while the low-and-middle income workers are still struggling. Many of those who managed to keep their jobs are working at lower pay and reduced benefits, further aggravating the situation.
According to a recent Pew Research Center poll, about two-thirds of the public now believes there are strong conflicts between the rich and poor. The percentage has grown by 19 points since 2009, suggesting that voters are growing far more aware of the economic division as the election approaches. The Pew report notes, even more notably:
…in the public’s evaluations of divisions within American society, conflicts between rich and poor now rank ahead of three other potential sources of group tension — between immigrants and the native born; between blacks and whites; and between young and old. Back in 2009, more survey respondents said there were strong conflicts between immigrants and the native born than said the same about the rich and the poor.
How much political capital can a candidate gain by dismissing the unemployed malcontents as immorally envious? It’s a risk, especially this year.
We all feel envious sometimes, and most of us are not proud of it (which is a good thing, since pride is another one of the Seven Deadly Sins). But that sort of envy comes from feeling ungraciously jealous when a friend gets a promotion or a new car or a charming boyfriend. Feeling resentful of Wall Street investors and bankers who made terrible economic decisions that affected the entire national economy—then continued to be extremely well compensated despite the failures—is not jealousy. It’s a reaction to what many Americans see as a basic question of fairness.
Americans are aspirational; this is why even those who will never in their lives amass $1 million still oppose the estate tax. And there is a strong sense in this country, among liberals and conservatives alike, that enterprise and creativity should be rewarded, financially and otherwise. What gets missed in the silly verbal jousting, in which President Obama has been declared a “socialist” and enemy of free enterprise, is that Wall Street itself wasn’t willing to submit to the uncertainty of capitalism. They wanted to privatize the profits. But they wanted to socialize the risk. And it was 401K holders and middle-class workers who bore the brunt of that bad risk.
There was a time when Americans could chuckle good-naturedly at the line in the movie Wall Street that “Greed is good,” and even agree with it, somewhat. But that was when envy was about who had the bigger car. The enviers now are the ones who have no health insurance and are losing their houses to foreclosure. And they vote.
Mitt Romney’s Tax Plan: Very Progressive By 15th Century Standards
The Tax Policy Center has completed an analysis of the distributional effects of Mitt Romney’s tax plan, and as might be expected it’s quite good for you if you’re raking in the big bucks, and not particularly helpful if you’re not. For the bottom 80% of the income distribution, federal tax rates would drop between 0.6% and 3.4%. For the top 20%, they’d drop 5.9%; for the top 1%, they’d drop 8.6%. That means the regular-joe taxpayer at the middle of the distribution gets a cut of about $1,400, while a taxpayer in the top 1% gets a cut of $171,000. Kevin Drum cracks wise:
[C]onservatives are right to believe that Romney isn’t to be trusted. Sure, he lowers tax rates on millionaires by 9 percentage points, and you may think that’s a pretty sweet deal for the rich. But come on. Newt Gingrich would lower them by 24 percentage points. (No, that’s not a typo.) Rick Perry lowers them by 20 percentage points. Herman Cain lowers them by 15 points. Frankly, Romney is hardly even trying here.
Along similar lines, and because I’ve been reading about this stuff lately, I’d like to point out that in the long historical context the tax rates Mr Romney is proposing are still extremely progressive. In fact, up until at least the 15th century or so, tax rates in the Western world were generally higher for poor people than they were for rich people. In early Renaissance Florence, as Tim Parks explains in his highly readable “Medici Money“, almost all state revenues were raised from excise taxes on consumption, while the holdings of the wealthy were exempt from almost any form of routine taxation. This state of affairs persisted until 1427, when the cost of hiring mercenaries to protect the city from the Duke of Milan, the French, and basically everyone else in the free-for-all of Italian politics rose so high that they had to introduce a universal tax called the catasto. This exempted about a third of the poorest households, while everyone over a certain level of income had to pay a flat tax of 0.5% on their wealth—a wildly progressive move in its day.
Meanwhile in Flanders, as John Munro writes in “The Usury Doctrine and Urban Public Finances in Late-Medieval Flanders (1220-1550): Rentes (Annuities), Excise Taxes, and Income Transfers from the Poor to the Rich“, state finance came to rely increasingly on issuing annuities paying an annual income. This was because the Catholic church’s rulings on usury made it increasingly difficult for sovereigns to borrow at interest. The Pope said it was okay to issue the annuities as long as the taxes used to pay them came from the produce of the land, safely removing them from the unnatural auto-reproduction of money implied in usury. That meant, again, that taxation mainly consisted of excise taxes on consumption, and “the obvious significance of this form of public-finance related taxation was that it was essentially very regressive, in representing a far greater burden on the poor than on the middle classes, let alone the rich.” Since most people who could buy and hold state annuities were rich, it was a pretty direct transfer of wealth from the poor to rentiers.
So, again, while it’s true that Mr Romney’s tax plans represent a large net transfer from the poor to the rich if you start from the baseline of current tax law, they’re actually pretty progressive if you’re willing to start from a pre-modern baseline.
By: Democracy in America, published in The Economist, January 6, 2012
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