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Warnings From Warner

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Matt Bai's profile of Mark Warner shows the former governor taking a more hardheaded and business-oriented approach to selling universal health care. And I think it's the right one:

 

What makes Warner, the former entrepreneur, sound more credible than your average Democrat is that he comes at these issues primarily from an economic, rather than a social, standpoint. 

 

On health care, for instance, most Washington Democrats will, as a matter of both habit and perspective, talk about the moral imperative of covering workers and the uninsured — and only then might they add, as an afterthought, that the current morass is an impediment to business too. Warner, on the other hand, begins with the idea that if American businesses can't keep up with spiraling health-care costs, the nation will lose the competition with India and China for jobs. The same principle applies with education and the deficit. His fixation on the global economy brings a coherent framework to issues that otherwise seem disparate and abstract.

I've long been a fan of the competitiveness case for universal health care. In an economy where workers depend on their employers for health benefits, talent that could otherwise be blazing new technological trails or innovative ideas is instead shackled to employers to guarantee their kid's medical care. And it's remarkable how far this dynamic reaches.

Matt likes to use the example of indie rock bands, arguing that the prevalence of British and English artists is a direct result of socialized health care, which makes the economics of starting a rock group much more plausible. I tend to go with the Garden State example: At the end the movie, it's clear that Natalie Portman (Sam) and Zach Braff (Andrew) are screwed. As an actor, Andrew needs to live in Los Angeles. As an epileptic paralegal in a firm with an "amazing" health plan, Sam can't afford to lose her insurance. So she can't move to be with him and he'd have to give up his profession to be with her. And all because of the employer-based health care system. Not only is it an impediment to economic efficiency on both the worker and employer side, but it obstructs true love.

Now, I'm not sure what Warner is actually proposing here -- I've seen worrying feints towards conservatism from him in the past -- but if he comes forward with a good plan, I think he's making the right case for it. He might want to add some more romance to the appeal, though.


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bluebell

 

Well, Ed Kilgore thinks we should be dazzled because Warner supports broadband.   Funny, so does my Cheney picked, right-wing Republican governor.

 

Since a substantial majority of Americans think this country is going in the wrong direction, wouldn't it be nice if we had at least one party going in a different direction?  Isn't 8 years of MBA speak enough?  After Katrina (remember Katrina??? Any Democrat rememember Katrina???) wouldn't it be nice to have at least one party in this country who believes health CARE is more important than a business plan for the insurance industry?

 

 

 

In an economy where workers depend on their employers for health benefits, talent that could otherwise be blazing new technological trails or innovative ideas is instead shackled to employers to guarantee their kid's medical care. And it's remarkable how far this dynamic reaches.

 

I would be curious to know if there is much if any empirical evidence to support the notion that American creativity is being shackled by the health care system because it prevents people from leaving their jobs.  My gut tells me that it might be a minor factor, but other factors are much more important.

 

My view is that the reason why health care is an American competitiveness issue has less to do with individuals' ability to move around and switch jobs and much more to do with the costs that must be borne by American corporations.  American corporations are at a competitive disadvantage in terms of the capital they have to invest in new products, marketing, R&D etc. because they spend so much money on their employees' health care.  This is especially true for those companies that are heavily unionized and which cover retiree health care as well.  GM has been described as a social insurance company that sells cars to fund its employees' health benefits.

 

I am actually the author of a book on how businesses can control health care costs.  So believe me when I say that this is becoming a major, major issue.  Where before the health plan was the province of the Human Resources department, now it is a CEO and CFO-level concern.

 

So Democrats are presented with a dilemma.  In order to expand the coalition of groups that are working for universal health care, including a possible shift to a government-run system, they might have to embrace and get in bed with big business.  At the very least, they might have to take business seriously and try to convince them to join the bandwagon, instead of assuming that they are an enemy.  This is surely a stupendously obvious and effective way to peel off a natural Republican constituency and bring them into the Democratic fold.  Unfortunately, many if not most Democratic activists instinctively distrust, if not outright loathe, big business.  That's why someone like Mark Warner is worth a good look in '08.  As a Democratic entrepreneur, he might just be the one to bridge that gap.

bluebell

 

I respect big business, but I also believe in checks and balances which we seem to be losing on absolutely every front these days.  We have no party trying to represent the public interest, community interest, etc. too fearful is the establishment of any common effort being labled "social".   We already have one party owned by big business.  Must all parties be owned by big business?  Is there no other interest?   Sick people aren't ever likely to be a big concern for big business unless they are profiting from their illness.

No one can write something like this:

 

Sick people aren't ever likely to be a big concern for big business unless they are profiting from their illness.

and say they respect big business.  Give me a friggin' break.  It's not the job of business to care about sick people.

 

And whoever said anything about being "owned" by big business. Democrats don't have to agree with everything business wants. But they should recognize that Democrats concern for universal health care and business' concern with controlling costs represents an opportunity for both groups that is there for the taking if only they can get over their mutual suspicion.

We need to distinguish between "business" - the insurance and HMO industry that is making big $$$ of the current fiasco - and "business" like GM or any employer getting their clocks cleaned by skyrocketing health care costs.

A smart single-payer proposal could be sold as a win-win for business and employees, (and indie rockers like myself - we all have full time jobs with benefits, which really slows down the creative process and makes touring a bitch.)

The only losers would be the small but powerful business and lobbying sector that by definition LIKE rising health care costs because thy're making a killing off them.

No doubt the insurance and HMO sectors would resist significant change to the current system. But it is a myth that they are making big bucks. HMOs aren't especially profitable.

 

The only major players in the current system that are unquestionably, outlandishly profitable are the major pharmaceutical companies (although their profitability and growth rates have declined in recent years) and high-end medical specialists.  Almost every other part of the health care system is not especially profitable or, in many cases, not profitable at all.

 

It's one of the wonders of our system that we can spend so much money, yet not that many are actually getting rich off it.

Brad, very interesting, and I agree with 99% of what you said.  Just to set the record straight, though, and maybe to give you a view of how we might be on the same page here:

 

I disagree that Democrats dislike, distrust, or loathe big business.  Many Democrats are highly successful business people.  Personally, I reserve my dislike, distrust, and loathing for such big businesses as Haliburton, Enron, and big oil, because of the special treatment they receive from their influential pals.  I don't trust the secrecy they have used to get their way to the disadvantage of all the rest of us. 

 

In general, I also believe the salaries of the CEO's of the mega companies do not reflect their worth relative to those thousands who work for them.  The wealth in this country is getting far too concentrated in the wallets of the few to make our society continue to work as well as it should.

 

All that said, I am from Virginia, and Mark Warner did a wonderful job.  How in the world he straightened out the mess left by Jim Gilmore and George Allen, I'll never know.  He did though, and he is truly a smart guy who actually knows how to govern.

 

I particularly agree with your take here:

American corporations are at a competitive disadvantage in terms of the capital they have to invest in new products, marketing, R&D etc. because they spend so much money on their employees' health care.  This is especially true for those companies that are heavily unionized and which cover retiree health care as well.  GM has been described as a social insurance company that sells cars to fund its employees' health benefits.

 

 

I think you've hit it on the nose.  A longer-view point is that a population that gets preventive health care is one that has fewer sick days, less expense for post-poned (and therefore more severe) health issues, and is generally better off.  I think this last point is comparable to the belief that most of us share that providing basic education to all children is better for all of us.

 

By the way, what is the name of your book, and what is your name?

 

Jan Knaus

bluebell

 

It's not the job of business to care about sick people.

 

Well, of course not!  Why would you have them write your health care legislation? 

 

Sorry for the rant, but this party's biggest problem is that it no longer can connect with the American people.  You have to convince them that they are at the heart of at least one issue.   I don't know why "progressives" must approach every issue like an accountant.  I know accountants who have more passion about health.  

 

Once upon a time, Democrats had a genuine passion about social issues.  Americans came to expect that even if they didn't always agree on every social program.   We've lost that connection.  We have the programs without the heart.   I don't believe we'll win till we get that heart back, but then I am a bleeding heart!

I don't doubt that many business people are Democrats. But if you look at the average hard-core Democratic activist, many of them talk about business as the enemy. Of course in some areas, there are things that business wants that no liberal could ever support. But this instinctive mistrust is not good.

 

My book is called What Works Now:Employer Strategies and Tactics in Controlling Health Care Costs and you can buy it here. It's only available through us, not in stores. It's also meant for HR managers, so it's pretty expensive.

Both of these approaches - appealing to the "moral imperative", and appealing to "national competitiveness" - are interesting as supplementary appeals, but are radically misguided if conceived as the leading idea in a Democratic health care pitch to voters.  They both suffer from the wonk's obsessions with aggregate, macro-level problems and fail to aim the message at individuals concerned about their own health care.  With apologies to John Kennedy, American voters are saying to the parties: "tell me not what I can do for my fellow man and for American business; tell me what you can do for me."

 

The voter doesn't care as much about:

  • American creativity is harmed because employees are shackled to their employers;

as they do about:

  • I am trapped in my job because of my damn health care plan; and it sucks.  I want to be able to look for new job and not have to worry about my health care.

Employers don't care as much about:

  • America is losing the global competitiveness fight because of spiraling healthcare costs;

as they do about:

  • I can't afford to get my employees quality health care and compete with my Chinese competitors at the same time.  I either skimp on healthcare and lose quality workers, or shell out for the health care and go out of business.  Either way I'm screwed.

 
Stop thinking so much about the complaints of economists, political philosophers and bioethicists regarding our current health care system, and think more about the answers you will get from individual voters if you ask them about their own health care.  I suspect you will get some combination of the following:

 

  • I don't have any;
  • It is too expensive; 
  • I have to fill out too many stupid forms;
  • It is unfair.  My health care isn't as good as the health care of people in other parts of the country.  And it's not as good as the health care of people who are richer than me, or have better jobs;
  • It's too damn complicated; 
  • My deductibles are too high;
  • I can't get to see the specialists I need to without going through an idiotic rigamarole for months of getting referred up the HMO food chain;
  • It's insecure.  I have health care today, but don't know whether I will have it tomorrow;
  • Drugs cost too much; all the rest of it costs too much as well;
  • I don't like my doctor;
  • I'm sick of having to do a damn research project every time I need some health care; to find out what is covered and what isn't;
  • Not everything that should be covered is covered.
  • I am a slave to my health plan.

 

So here is the message we want to give to Mr. and Ms. voter:  We are going to make your health care cheaper, simpler, better and more secure.

 

Then figure out how to do it.  Think in terms of what we are going to deliver to Americans - not interms of plans, philosophy and academic think tank debates.  That's for the experts.  If those experts can come up with some sort of plan that will be clearly better for, oh let's say 70% of Americans, then we have a winner.

 

 

The other major player in the current system that is outlandishly profitable is the insurance industry.  They take 30 cents off of each health care dollar and provide little or nothing of benefit.  The pharmaceutical companies provide very beneficial stuff, it's just over priced.

Not profitable?? Not profitable?? Have you HEARD of United Health Care  or Wellpoint or Caremark?

They are staggeringly profitable and their stock prices show it. Don;t be fooled by their gross margins as they count tons of pass through revenue in them. 

Matthew Holt The Health Care Blog

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