“The Free Market Failed”: Here’s Some More Good News About Obamacare. Too Bad It Won’t Dent The Debate
Whenever a health insurer announces that it will be requesting significant premium increases in the coming year, it’s guaranteed to generate news stories that are waved triumphantly by conservatives as proof that the Affordable Care Act is a failure and, just as they predicted, premiums are skyrocketing because the government is messing around in health care.
When a story like this one comes along, on the other hand, it seems to generate much less attention:
California’s Obamacare exchange negotiated a 4% average rate increase for the second year in a row, defying dire predictions about health insurance sticker shock across the country.
The modest price increases for 2016 may be welcome news for many of the 1.3 million Californians who buy individual policies through the state marketplace, known as Covered California.
California’s rates are a key barometer of how the Affordable Care Act is working nationwide, and the results indicate that industry giants Anthem and Kaiser Permanente are eager to compete for customers in the nation’s biggest Obamacare market.
Leading up to Monday’s announcement there had been a steady drumbeat of news about major insurers outside California seeking hefty rate hikes of 20% to 40% for Obamacare open enrollment this fall.
Keep in mind that before the ACA went into effect, annual premium increases of 10 percent or so had become the norm. California is only one state, and when you go across the country the picture is complicated — in some states premiums are rising more slowly than they did before the law; in other states they’ve jumped; and in some places they’ve declined. There are many reasons why. But what’s important to understand is that the predictions of the law’s critics — that both overall health spending and premiums would explode — were completely wrong.
The key word in this story comes in the first paragraph: “negotiated.” California is one of the states where officials running the health care exchange negotiate with insurers over rates, and when you have a negotiation, you can get better terms for the people you represent. Yet incredibly, we’re still arguing over whether what the health insurance market needs is less government involvement and more of that free market magic.
So for the millionth time: the reason we have the world’s most expensive health care system is precisely because the free market failed.
If conservatives were right and government is the problem, then in all the world’s other advanced nations, where there is much more government regulation of health care than we have, they’d be paying more for their health care than we do. But they spend far less, often with better health outcomes and usually with virtually no uninsured. And after watching this debate for the better part of a decade, I’ve yet to hear a single conservative explain why that’s the case, and how it squares with their beliefs about government and markets. How can it possibly be that government-heavy systems — whether you’re talking about a completely socialized one like Great Britain’s or a system like France’s that combines a basic government plan with heavily regulated private supplemental insurance — work so much better and cost so much less than ours? If you have a religious belief that markets are always right and government is always wrong, it’s just impossible to reconcile.
The point isn’t that the ACA is a perfect piece of legislation that has solved all our problems, because it isn’t and it hasn’t. The ACA is a gigantic kludge layered on top of what was already a terribly dysfunctional system. Health insurance in America remains incredibly complicated — for instance, if you’re on an exchange, in order to get the best rate you may have to shop around every year. Unfortunately, Republicans have made it impossible to fix the law’s weaknesses as we used to do with complex legislation, because they’ve fed their constituents a lie that any day now they’re going to repeal the whole thing, so there’s no point in trying to make it work better (and that doing so would be a compromise with evil, of course).
Fifty years ago this Thursday, Lyndon Johnson signed Medicare into law. At the time, Republicans predicted not only that the program would be a failure, but that it would send America hurtling toward a socialist nightmare of oppression. Ronald Reagan famously said that if the law passed, “we are going to spend our sunset years telling our children, and our children’s children, what it once was like in America when men were free.” Yet this big-government, single-payer health insurance program for seniors turned out to be one of the most successful and popular pieces of legislation in American history. Not only that, due in part to the Affordable Care Act, the projected future cost of Medicare keeps going down — another conservative prediction about the ACA that has proven wrong by 180 degrees.
And today, Republicans pretend they love Medicare and only want to preserve it, while they present plans that would eliminate its guarantee of coverage and turn it into a voucher program, on the failed theory that whatever the private sector does in health care must be superior. These efforts always fail, because the program is just too popular.
The ACA isn’t politically bulletproof in the same way, in large part because it’s so many different things. No one “has” Obamacare in the way you have Medicare, with a card in your wallet; in fact, tens of millions of people are affected by the ACA, usually in positive ways, without ever realizing it. But here’s a crazy idea: What if we looked at where the law is succeeding and tried to build on that success, and looked at where it isn’t and tried to correct those shortcomings, doing it all with the best understanding of the actual facts we can gain?
Oh, who am I kidding.
By: Paul Waldman, Senior Writer, The American Prospect; Contributor, The Plum Line Blog, The Washington Post, July 28, 2015
“Creating Straw Politicians”: Scott Walker And The GOP Are Wrong About The Safety Net
It’s back and Democrats are going to have to deal with it. I’m talking about the political argument that they want to lure as many people as possible into government dependency.
This is a staple of Wisconsin Gov. Scott Walker’s incipient presidential campaign, and he frames it as simple common sense. “Oftentimes when I think about the president and people like Hillary Clinton, I hear people who I think measure success in government by how many people are dependent on the government. By how many people are on food stamps and Medicaid and unemployment,” he said this week at the Florida Economic Growth Summit in Orlando. “I don’t know about all of you, but my belief in America is that we should measure success by just the opposite.”
Walker added: “I don’t remember any of my classmates saying to me ‘Hey, Scott, someday when I grow up, I want to become dependent on the government.’ Nobody signed my yearbook ‘Dear Scott, Good luck becoming dependent on the government.’”
Very funny, and a lot more appealing than Mitt Romney’s assertion that 47 percent of the electorate is dependent on government and will never take responsibility for themselves. The problem with Walker’s formulation, however, is that he’s creating straw politicians. President Obama and Clinton and practically everyone in their party — in fact both parties — talk incessantly about education, job creation, income inequality, and how to increase wages. That doesn’t sound like a yearning for Handout Nation. It sounds like people obsessing over how to make America a country of tubs standing on their own bottoms.
I’m not saying that Democrats haven’t given Republicans ammunition. The 2012 Obama campaign’s “Life of Julia” cartoon slideshow was a parody waiting to happen. From Julia’s enrollment in Head Start as a preschooler to her retirement aided by Medicare and Social Security, the sequence gave off a distinctly Soviet, cradle-to-grave vibe.
As pediatric neurosurgeon-turned GOP candidate Ben Carson put it in his announcement, “We’re not doing people a favor when we pat them on the head and say ‘there there, you poor little thing, we’re going to take care of all your needs. You don’t have to worry about anything.’ You know who else said stuff like that? Socialists.” That was less than a week after a real socialist — Vermont Sen. Bernie Sanders — announced he was running for the Democratic nomination.
Obama came into office amid the worst recession since the Great Depression. The rolls of the three programs Walker named swelled as people lost jobs, income and health insurance. Job losses climbed to a terrifying 818,000 in January 2009, the month Obama was inaugurated. Another 2.2 million jobs were gone by the end of April. The unemployment rate was at or near 10 percent for eight months. So yes, there were a lot of people relying on government programs, for good reason. The private sector had completely failed them.
Obama’s chief economic message for years has been about sustained job creation and an unemployment rate nearly down to half its recession peak, not high enrollment in safety-net programs. Democrats do try to educate people about benefits for which they may qualify. But the goal is to get them on their feet, not lock them into dependency.
There is one area of government “dependency” that Obama and his party are proud of, and that is health insurance. The Department of Health and Human Services said this week that 10.2 million people bought private health coverage this year under the Affordable Care Act, and 85 percent of them receive federal subsidies to help pay for it. Millions more have been able to enroll in Medicaid as a result of the ACA expansion of the program to people with incomes slightly above the official poverty line. For those who believe health coverage should be universal, the numbers justify a victory lap.
People who receive insurance help, or food stamps or unemployment benefits, do indeed depend on the government — just like farmers, homeowners, corporations, and anyone else who receives subsidies or tax breaks, as well as companies that don’t provide health insurance or living wages. And just to be clear, if they are not children, disabled, or elderly, people who use the safety net often have jobs. Nearly 43 percent of all food-stamp recipients live in a household with earnings, according to the Department of Agriculture. The Kaiser Family Foundation, in a study of states that haven’t adopted the Medicaid expansion, found there are workers with full- or part-time jobs in 66 percent of the families eligible for it.
Jeb Bush has called the safety net “a spider web that traps people in perpetual dependence.” We are going to hear a lot of statements like that in the next 18 months. But that doesn’t make them true.
By: Jill Lawrence, The National Memo, June 4, 2015
“Mike Huckabee Is Prepared To Blow Up Republicans’ Big Ruse”: Pulling Back The Curtain On The Party’s Double Dealing
By the time the sixth or seventh candidate enters a Republican presidential primary, it’s usually tough to identify a unique quality that distinguishes him from those who came before. Most of the predictable niches—the Establishment candidate, the Religious Right candidate, the Conservative Absolutist candidate, the non-white/non-male outreach/token candidates, the outsider candidate, etc.—have already been filled.
With that pattern in mind, you might imagine Mike Huckabee missed his moment. At the time of his announcement last week, the GOP race already included a Religious Right tribune (Ted Cruz), an Evangelical Christian (Scott Walker), a fair-weather libertarian (Rand Paul), an outreacher (Marco Rubio), an outsider (Ben Carson), and a woman (Carly Fiorina). And in a purely electoral sense, Huckabee did miss his moment.
Huckabee, a Southern Baptist minister, had a better opportunity to consolidate the religious conservative vote against the donor candidate in 2008 than he does now, and even then he came up short. Eight years ago, as Nate Cohn wrote recently at the New York Times, “religious conservatives had serious reservations about the two main candidates, John McCain and Mitt Romney.” This year things are different.
But this isn’t just a simple story about a hopeless underdog deluding himself about his odds, or a retread of so many GOP primaries where too many conservatives vie for the right wing vote and clear a path for the money guy.
Huckabee appears to be aware of his liabilities, and is thus angling not only for the evangelical vote, but for the old person vote in general. He’s adopted the view, unfathomable in modern Republican politics, that support programs for the elderly shouldn’t be tampered with, and not just for today’s seniors, but for at least a generation. By doing so he’s violated the GOP’s implicit pact that discourages members from accentuating the tensions between the party’s fiscal priorities and its aging political base. If he makes good on this cynical strategy, he will probably still lose, but his candidacy will have served a valuable and revealing purpose.
Let’s be clear up front that Huckabee’s positioning here is 100 percent cynical. As John McCormack of the neoconservative Weekly Standard reminded us last month, Huckabee was a proponent of the Republican consensus as recently as August 2012, when he wrote on his Facebook page that “Paul Ryan is being demonized for his suggested Medicare reforms. But the alternatives may be scarier.”
Today, Huckabee says he wouldn’t sign legislation codifying Ryan’s Medicare reforms if he were president, and lambasted New Jersey Governor Chris Christie’s proposal to further raise the Social Security retirement age over time. In Iowa this week, Huckabee told a crowd of supporters, “It is a foolish thing for the government to involuntarily confiscate money from your pockets and paychecks for 50 years, and then suddenly tell you, oh, we were just kidding.”
What he didn’t mention is that his proposed “Fair Tax”—a hefty tax on consumption—would disproportionately increase costs for fixed-income seniors, who spend most of their money, and thus operate in effect much like a Social Security benefit cut.
But for political purposes, it doesn’t really matter that Huckabee isn’t acting out of compassion for the elderly or the poor. What matters is that he’s motivated enough to pull back the curtain on the party’s double dealing.
For the entirety of Barack Obama’s presidency, Republicans have taken an awkward, cynical, schizophrenic view of entitlements. They have voted with near unanimity for a budget that would radically overhaul Medicare, but have promised (unworkably) to isolate the old and nearly old from any disruptions. They have largely sidelined their preferred Social Security reforms, but salivated over the prospect of voting for a cut to Social Security benefits when they thought Obama might sign it. They have railed against the Affordable Care Act for reducing spending on Medicare while voting for budgets that preserve those very cuts.
The only way to make sense of this mishmash is to remember that the GOP owes its political livelihood to the elderly. To pursue conservative goals, without obliterating their coalition, Republicans must twist themselves into pretzels. They must detest spending, but only on those other people. Their rhetorical commitments are impossible to square with their ideological and substantive ones, though, and the agenda they’ve promised to pursue when they control the government again would not exempt retirees and near retirees in any meaningful way. At the end of the day they can only keep their promises to one interest group, and it’s not going to be the elderly.
In effect, Huckabee is promising to lay this all out for Republican primary (i.e. older) voters, and place his rivals in the exquisitely awkward position of having to explain themselves. Normally the way things work in Republican primaries is that candidates seek advantage by drawing attention to their opponents’ insufficient commitment to conservatism. Huckabee’s big bet is that—in this one substantive realm, where conservatism and voter self-interest point in opposite directions—he can do the same by running to the left. Watching him test this theory, even in defeat, will be fascinating.
By: Brian Beutler, The New Republic, May 11, 2015
“Entitlements For Me And Mine”: The GOP Wants To Cut The Social Safety Net — But Only For Young And Poor People
Newly minted 2016 presidential candidate Mike Huckabee is selling himself to older Republicans as the guy who will keep Washington’s grasping hands off their government-provided Medicare and Social Security. In his recent announcement speech, the former Fox News host and ex-governor of Arkansas attacked rivals who “propose that to save the safety nets like Medicare and Social Security, we ought to chop off the payments for the people who have faithfully had their paychecks and pockets picked by the politicians.” For that and similar statements, Huckabee’s candidacy is being portrayed as some radical departure from GOP economic orthodoxy and, as The New York Times put it, is supposedly “exposing growing fault lines in the party over an issue that has long been considered a political third rail.”
Not so much, actually. Huckabee’s do-(almost)-nothing stance on entitlement reform reflects the GOP consensus. He’s just more explicit about it than most. It’s really only potential 2016er Chris Christie — with his call for cutting retirement pay for wealthier seniors — who seems to be the odd man out.
There was a time, of course, when Republicans were pushing hard to fix the fiscal problems of Medicare and Social Security. Rep. Paul Ryan’s 2010 “Roadmap for America’s Future” probably marked Peak Reform. That budget blueprint called for allowing pre-retirement workers to divert part of their payroll taxes into private retirement accounts and to receive vouchers to buy private health insurance when they finally called it quits. Such sweeping changes were needed, Ryan and other Republicans argued, to prevent these programs from “bankrupting” America.
But by the 2012 presidential election, Republicans were backtracking from those big ideas. In his convention speech, GOP presidential nominee Mitt Romney attacked President Obama for wanting to cut future Medicare spending. Vice presidential nominee Paul Ryan explained how important Medicare was for his grandmother with Alzheimer’s. Social Security wasn’t mentioned by name at all. Likewise, the Ryan budgets stopped calling for specific Social Security reforms.
Things went even further in the 2014 midterms, when GOP groups ran ads against some Democratic candidates accusing them of wanting to cut Social Security benefits and raise the retirement age. And today, the new Republican House-Senate budget drops the “premium support” Medicare reform that had been a staple of the Ryan budgets, although it does include some $400 billion in unspecified, 10-year Medicare savings also requested by Obama.
So what happened? The long-term federal financial picture hasn’t miraculously turned around since 2010. The Congressional Budget Office projects that federal spending on Medicare and Social Security over the next 25 years will rise by roughly three percentage points of GDP, from 8 percent to 11 percent. The debt deluge that prompted calls for radical reform is still on its way. What has changed is that Republicans are wising up to just how much they depend on older voters. Those 65 and over gave 56 percent of their votes to Romney in 2012 and were critical to congressional victories in 2010 and 2012.
Another big change since 2010: ObamaCare. The passage of the the president’s Affordable Care Act — opposed by older, tea party Republicans — has affected how GOP politicians view and talk about the safety net. They now clearly differentiate between “earned” entitlement benefits such as Medicare and Social Security and “unearned” welfare benefits such as ObamaCare subsidies, Medicaid, and food stamps. As Wall Street Journal columnist Holman Jenkins accurately predicted back in 2013, “The new ‘conservative’ position will be to defend Social Security and Medicare, those middle-class rewards for a life of hard work and tax-paying, against Mr. Obama’s vast expansion of the means-tested welfare state for working-age Americans.” Republican voters get the “good” entitlements, Democratic voters the “bad,” dependency-creating ones.
Huckabee clearly intends seniors to be the rock upon which he builds his candidacy. In the “Seniors” section of his campaign website, he promises to fight for the “earned benefits” of Social Security and Medicare — perhaps forgetting that a typical middle-class, one-earner couple retiring in 2030 will receive $1.3 million in lifetime Medicare and Social Security benefits, having paid in just under $500,000. Huckabee then attacks ObamaCare as a welfare program that diverts $700 billion from Medicare and fosters “government dependency.” Entitlements for me and mine but not for thee and thine.
The politics of this strategy are debatable. (Though it surely doesn’t help attract younger voters!) But regardless, it makes for simply awful public policy. Future safety net spending increases on older Americans need to be reduced. Republicans should continue the earlier work of Ryan in building the case for those changes. Moreover, more of what is spent will need to shift to lower-income Americans. At the same time, some kinds of safety net spending for the poor will need to be increased, such as the Earned Income Tax Credit. And turning Medicaid into a program that uses tax credits to buy private insurance, as some on the right want to do, would also likely cost more money.
If today’s GOP-leaning seniors want their grandkids to grow up in an America that can better take care of the truly needy — young and old — and pay its bills, they’ll reject Huckabee’s selfish populism.
By: James Pethokoulis, The Week, May 8, 2015
“Zombies Of 2016”: As Far As Issues Go, 2016 Is Already Set Up To Be The Election Of The Living Dead
Last week, a zombie went to New Hampshire and staked its claim to the Republican presidential nomination. Well, O.K., it was actually Gov. Chris Christie of New Jersey. But it’s pretty much the same thing.
You see, Mr. Christie gave a speech in which he tried to position himself as a tough-minded fiscal realist. In fact, however, his supposedly tough-minded policy idea was a classic zombie — an idea that should have died long ago in the face of evidence that undermines its basic premise, but somehow just keeps shambling along.
But let us not be too harsh on Mr. Christie. A deep attachment to long-refuted ideas seems to be required of all prominent Republicans. Whoever finally gets the nomination for 2016 will have multiple zombies as his running mates.
Start with Mr. Christie, who thought he was being smart and brave by proposing that we raise the age of eligibility for both Social Security and Medicare to 69. Doesn’t this make sense now that Americans are living longer?
No, it doesn’t. This whole line of argument should have died in 2007, when the Social Security Administration issued a report showing that almost all the rise in life expectancy has taken place among the affluent. The bottom half of workers, who are precisely the Americans who rely on Social Security most, have seen their life expectancy at age 65 rise only a bit more than a year since the 1970s. Furthermore, while lawyers and politicians may consider working into their late 60s no hardship, things look somewhat different to ordinary workers, many of whom still have to perform manual labor.
And while raising the retirement age would impose a great deal of hardship, it would save remarkably little money. In fact, a 2013 report from the Congressional Budget Office found that raising the Medicare age would save almost no money at all.
But Mr. Christie — like Jeb Bush, who quickly echoed his proposal — evidently knows none of this. The zombie ideas have eaten his brain.
And there are plenty of other zombies out there. Consider, for example, the zombification of the debate over health reform.
Before the Affordable Care Act went fully into effect, conservatives made a series of dire predictions about what would happen when it did. It would actually reduce the number of Americans with health insurance; it would lead to “rate shock,” as premiums soared; it would cost the government far more than projected, and blow up the deficit; it would be a huge job-destroyer.
In reality, the act has produced a dramatic drop in the number of uninsured adults; premiums have grown much more slowly than in the years before reform; the law’s cost is coming in well below projections; and 2014, the first year of full implementation, also had the best job growth since 1999.
So how has this changed the discourse? On the right, not at all. As far as I can tell, every prominent Republican talks about Obamacare as if all the predicted disasters have, in fact, come to pass.
Finally, one of the interesting political developments of this election cycle has been the triumphant return of voodoo economics, the “supply-side” claim that tax cuts for the rich stimulate the economy so much that they pay for themselves.
In the real world, this doctrine has an unblemished record of failure. Despite confident right-wing predictions of doom, neither the Clinton tax increase of 1993 nor the Obama tax increase of 2013 killed the economy (far from it), while the “Bush boom” that followed the tax cuts of 2001 and 2003 was unimpressive even before it ended in financial crisis. Kansas, whose governor promised a “real live experiment” that would prove supply-side doctrine right, has failed even to match the growth of neighboring states.
In the world of Republican politics, however, voodoo’s grip has never been stronger. Would-be presidential candidates must audition in front of prominent supply-siders to prove their fealty to failed doctrine. Tax proposals like Marco Rubio’s would create a giant hole in the budget, then claim that this hole would be filled by a miraculous economic upsurge. Supply-side economics, it’s now clear, is the ultimate zombie: no amount of evidence or logic can kill it.
So why has the Republican Party experienced a zombie apocalypse? One reason, surely, is the fact that most Republican politicians represent states or districts that will never, ever vote for a Democrat, so the only thing they fear is a challenge from the far right. Another is the need to tell Big Money what it wants to hear: a candidate saying anything realistic about Obamacare or tax cuts won’t survive the Sheldon Adelson/Koch brothers primary.
Whatever the reasons, the result is clear. Pundits will try to pretend that we’re having a serious policy debate, but, as far as issues go, 2016 is already set up to be the election of the living dead.
By: Paul Krugman, Op-Ed Columnist, The New York Times, April 24, 2015
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