A Total Loss of Perspective

The images from the protests held Thursday on the steps of the Capitol were disturbing; the (by now) typical Obama-as-Death effigies and confused references to both Fascism and Communism shared the stage with a new twist. One of the protesters decided that graphically comparing the health care bill to a Nazi death camp was a good idea.

“National Socialist Health Care” was the label, superimposed over the emaciated bodies stacked at Dachau. Horrifying.

To protest legislation on the steps of the Capitol is a responsibility as well as a right; it is one of the prices we must pay for freedom. The rational middle contends that those protests should be passionate and pointed, but that they should also stay within some set of boundaries. There was a time when we were able to recognize when those boundaries were violated. Has that time passed?

This space takes no exception to those who believe that the election of Barack Obama or a large Democratic majority in both houses is dangerous; people on the other side of the fence believed the same of George W. Bush. This space also agrees that active and vocal political conflict is appropriate for those who are in the political minority. The difference exists in the scope and tone of the conflict. In an effort to discredit the health care bills, many in the country have built this bill into monstrous proportions. The various bills have been cast as granny killers, communist plots, and insidious Muslim conspiracies.

I definitely miss the tax and spend arguments that Reagan used to win debates. In the case of these bills, Republicans and Populists would have a great deal to question (indeed attack) regarding the spending levels and benefits attached. The great pity is that Republicans had a natural position in health care reform; only recently taking a tiny step towards it in their own version of reform. They could have acted to end anti-trust exemptions, create co-ops and/or exchanges, and provide credits to small businesses. These pro-business positions would have been reasonable and proactive attempts to resolve problems, and would have found wide support. They could have chosen a more aggressive stance, and used the opportunity to go after payroll taxes on small businesses.

The grand ole party chose to drift down to its lowest common denominator, and has missed a golden opportunity. They will vote against a bill that will disappear as an issue until people start benefiting from it. Even the costs now have some justification. The current bill, HR 3692, will end up costing about $100 billion per year over ten years (after the conference work between the House and Senate). While this is a large number, consider this fact: the Bush tax cuts were designed to stimulate the economy and will cost $300 billion per year over the 6 years of the plan. I think we all know what happened to the economy.

The big question is what this bill will or won’t do. Here is a list of things the bill will not do:

  • It will not mandate that anyone take Federal insurance. The exchanges and co-ops constructed by the bill rely on the existence and competitiveness of private insurance firms.
  • It will not tell doctors what they can or cannot treat. The doctor-patient relationship is specifically outlined in the bill.
  • It will not cover everyone. The most optimistic estimates make a claim of 96% covered. Some estimates are lower.

What will it do?

  • It takes away the industry’s anti-trust exemption, meaning that insurance companies can no longer operate as a monopoly.
  • It creates and provides support for private, non-profit co-ops to allow individuals and small businesses to come together to get better coverage and lower rates.
  • It creates exchanges that will like an insurance “stock market”. This is another tactic provided to provide competition in the marketplace. It is within the exchange that the much misunderstood public option exists.
  • It outlaws preexisting conditions and excessive rates for older Americans.
  • It sets a floor at 85% of premiums collected to be returned to clients in the form of services. This industry measure was in the mid 90’s during the mid 1990’s and has declined since.

A controversial piece is the mandate for individuals to carry insurance. The idea is that many of these measures will reduce per-customer margins for the industry. When margins tighten in business, companies must replace lost margin with increased volume. This combination of directives is designed to turn the health insurance industry into a traditional service provider that is forced to deliver higher quality products at lower prices to be competitive.

Not the worst idea in the world, even if it isn’t the best. What this bill represents is entitlement programs for the 21st century. It is public policy used to redefine a marketplace and refocus market pressures to drive private business solutions. Done properly, the result will force more insurers and health providers to find solutions like those used by the Mayo Clinic, Kaiser Permanente, or Intermountain Healthcare; solutions that find these systems with the highest service levels and lowest prices in the country.

Big dollars…yes. Socialism….uh, no. I think that opponents of the President’s agenda should continue to resist with courage and passion. It might, however, be advisable for these folks to read the bills they are attacking first. Even better, folks should proactively propose solutions to problems we know are out there. Then we could have a good old fashioned political debate!

The Rational Middle is ready….