Marketplace of Ideas Blog

From the Associated Press, unbiased provider of news:

Summoned to success by President Barack Obama, the Democratic-controlled Congress approved historic legislation Sunday night extending health care to tens of millions of uninsured Americans and cracking down on insurance company abuses, a climactic chapter in the century-long quest for near universal coverage. ...

Crowds of protesters outside the Capitol shouted “just vote no” in a futile attempt to stop the inevitable taking place inside a House packed with lawmakers and ringed with spectators in the galleries above.

Across hours of debate, House Democrats predicted the major bill, costing $940 billion over a decade, would rank with other great social legislation of recent decades.

I wasted a few minutes Sunday night (others watched much more) watching the House of Representatives on C-SPAN. (There were a few minutes Sunday where basketball was not being played.) And what I watched demonstrated the reality that the term “democracy” applies to the House of Representatives only in the sense that in a true democracy, 51 percent of the people could vote to execute 49 percent of the people.

Wielding the gavel in the House was Wausau’s own U.S. Rep. David Obey, Sunday night’s leader in the dictatorship of the majority that is the House, greasing the skids to supposedly save Barack Obama’s presidency. (That reportedly is what Obama himself argued in twisting the arms of recalcitrant Democrats.)

Obey made an interesting comment last week in challenging, according to Gannett Newspapers, “colleagues to end the disparity between Americans who have no health insurance and members of Congress who have coverage paid for by taxpayers. ‘That difference is shameful, that difference is immoral, and I hope to God that this House has the courage and the decency to vote to change it,” Obey said.” Of course, Congress isn’t going to change its, or federal employees’, Rolls–Royce health care coverage to waste less money.

And then there’s this assertion:

The nonpartisan Congressional Budget Office said the legislation would extend coverage to 32 million Americans who lack it, ban insurers from denying coverage on the basis of pre-existing medical conditions and cut deficits by an estimated $138 billion over a decade. If realized, the expansion of coverage would include 95 percent of all eligible individuals under age 65.

The one thing we can all be sure of is that the CBO figures will turn out to be completely false. (More made-up numbers can be found in the sidebar here.) The Economist explains why:

The CBO also reckon that the health-care package, through savings and new revenue, will cut the total deficit over those years by $138 billion against a baseline scenario. After that, the savings get even bigger, totalling (a much more speculative) $1.2 trillion by 2029, according to some Democrats. But the sums are questionable. The CBO process has been so thoroughly gamed that the true figures could be quite different. The Republicans claim that it will cost far more and totally reject the idea that it will cut the deficit by such a sum over the second decade.

The CBO is required to score what Congress says it will do, not what it is likely will actually be done.

Anyone who believes the bill Congress passed last night will reduce the deficit at all must also believe Wisconsin will win the men’s basketball national championship in two weeks. (For those unfamiliar with this reference: Cornell 87, Wisconsin 69.) But don’t believe me, ask Douglas Holtz-Eakin, former CBO director:

The answer, unfortunately, is that the budget office is required to take written legislation at face value and not second-guess the plausibility of what it is handed. So fantasy in, fantasy out.

In reality, if you strip out all the gimmicks and budgetary games and rework the calculus, a wholly different picture emerges: The health care reform legislation would raise, not lower, federal deficits, by $562 billion. …

The bottom line is that Congress would spend a lot more; steal funds from education, Social Security and long-term care to cover the gap; and promise that future Congresses will make up for it by taxing more and spending less.

Readers of Marketplace’s coverage of health care deform know that this bill doesn’t provide health care reform at all. It may provide health insurance to more people (though no more than 95 percent, and probably less), but it doesn’t get people out of emergency rooms and to doctors on a regular basis. It will, for the first time in our nation’s history, mandate that people buy a product from a private business, something that may be good for the health insurance business but is bad for freedom. It will simultaneously make health insurance more expensive, not less; it will penalize employers who don’t have enough revenue or profit to provide health insurance for their employees. (That punishment should be provided by the job market in employees’ making employment decisions, not by the government.) It will assess Medicare taxes, for the first time, on interest and dividend income. It does nothing about medical malpractice, and it does nothing meaningful about improving medical quality.

To no one’s surprise, U.S. Rep. Steve Kagen, M.D. (D–Appleton), ignored his constituents — business owners — and voted for the bill. Well, good luck in November, Steve.

From the beginning, Obama was bound and determined to jam this down the throats of not just those paying for health care, but those who are reasonably satisfied with their own health care and do not want it changed. I guess I could argue that those who voted for Democrats in 2006 and 2008 and Obama in 2008 deserve whatever they get, except that most people who did voted for Democrats and Obama to make things better. And when it comes to the real problems in health care — using the system in the wrong places for the wrong reasons, insufficient quality, and excessive cost caused by defensive medicine — this will not make things better.

So Obama and Democrats won this one. May it be a Pyrrhic victory for them and not for Americans who have to live with this.