Is Krugman right about health care?
... The alternative would be some complicated public-private hybrid – perhaps a voucher system (as Emanuel and Victor Fuchs recently urged in the Washington Monthly) or a bolstered private insurance system with public programs to back them up.
Most of Washington (well, at least that part of Washington that thinks seriously about this issue) seems to favor the hybrid approach. Krugman (along with most of the aforemenionted bloggers) dissents on both policy and political grounds. He says single-payer is more efficient, citing its relatively lower administrative costs, and that it’s actually an easier sell politically, because it’s so much simpler to explain. Since special interests are likely to attack a health care reform plan no matter what shape it takes, there’s no reason to present a more “moderate” plan just to appease K Street. After all, that’s precisely what the Clintons tried to do. And look where it got them.
Let me say, first, that I am very pleased to see this debate taking place.
Ever since the failure of the Clinton plan, Democrats have talked about health care reform very cautiously. Even when they invoked the term "universal coverage," they weren't really proposing to achieve it. During last year's presidential campaign, for example, even the most expansive of the plans during the presidential primaries would have left one-fourth of the current uninsured population without coverage. (I'm not including Dennis Kucinich's plan here; his plan, a single-payer proposal, would indeed have covered everybody.)
Now we find ourselves debating real universal coverage. That's a huge step forward. And this is the right time to be starting this debate if we want to see it be a major issue in the 2008 presidential election. (I suppose it could be an issue in the congressional race, but the agenda tends to be more splintered in off-year contests.)
As for the substance of Krugman's column, I think his most important point is about how we remember the Clintoncare episode.
Because the Clinton plan is (wrongly) remembered as a textbook case of overambitious liberalism, people forget that the Clintons tried hard to devise a plan that at least some special interests would like. And they arguably succeeded. It would have been a very good deal for large employers already stuck paying large health care bills, like the Big 3 automakers, since it would have limited that financial liability. It would also have been a boon for the large insurance companies who would have gained what amounted to a government-sanctioned oligopoly. Remember, under the Clinton plan everybody would have had insurance – but it would have been private coverage, purchased through a “purchasing alliance” or through a large employer.
But small employers, most of whom didn’t insure their workers already, were far less enthusiastic -- since the Clinton plan would have required them to contribute money to their workers’ coverage. Even more opposed to the plan were insurance agents and small insurance companies, who would have been driven out of business. Not surprisingly, they were the ones behind the infamous “Harry and Louise” ads and its associated misinformation campaigns.
But small employers, most of whom didn’t insure their workers already, were far less enthusiastic -- since the Clinton plan would have required them to contribute money to their workers’ coverage. Even more opposed to the plan were insurance agents and small insurance companies, who would have been driven out of business. Not surprisingly, they were the ones behind the infamous “Harry and Louise” ads and its associated misinformation campaigns.
Meanwhile, the special interests that did like the Clinton plan never fought for it. In 1994, even after groups like the Chamber of Commerce came out against the Clinton plan, many large manufacturers and all (well, I think all) the big insurance companies continued to endorse it. But they didn’t lift a finger to help get it passed.
(Of course, it also didn’t help that the two groups Clinton had hoped would rally to his cause – labor and the elderly – largely sat out the fight. Labor got sidetracked fighting NAFTA while AARP had to hold its fire while its members stewed over leaks about proposed Medicare cuts that would have helped finance the Clinton’s proposed coverage expansions.)
The point isn’t that reformers should antagonize special interests intentionally. In fact, the one successful effort at enacting universal-style reform -- Medicare -- happened in part because hospitals embraced it (they were going bankrupt paying for all of the destitute elderly patients) and in part because the insurance industry was willing to give up the elderly market (because seniors were relatively unprofitable.) If there's an easy way to keep some special interests on the sideline, reformers should do it.
But at least for now, pushing a second-best plan in order to curry favor with groups that might, at best, offer lukewarm support doesn't make a whole lot of sense, either.
There will always be some special interest opposition to reform -- and it will always be strong. Reformers can overcome it only with better organizing and more persuasive arguments that convince an ambivalent public.
There will be plenty of time for compromising later.
But at least for now, pushing a second-best plan in order to curry favor with groups that might, at best, offer lukewarm support doesn't make a whole lot of sense, either.
There will always be some special interest opposition to reform -- and it will always be strong. Reformers can overcome it only with better organizing and more persuasive arguments that convince an ambivalent public.
There will be plenty of time for compromising later.
