Site Meter

Thursday, August 20, 2009

11 dimensional chess

I am not a competent player of 2 dimensional chess, but I'll try 9 more.

First a bit of history. Health care reform is in trouble. Once it seemed easy, because the health insurance lobby said they'd support it provided there was universal health insurance. Oh my, universal coverage was their condition and the first concession made by Obama to Senator Max Baucus (D-insurance industry).

Since Obama wants universal coverage he was either very brilliant very lucky or both.

Unfortunately, Baucus has not delivered. Now there are more conditions including the bill must get 60 votes in the senate (no reconciliation), it must be bipartisan and there must be no public option.

I think it is time for Obama to say that, since he didn't get health reform in exchange, he's withdrawing his concession and going back to the proposal he made during the campaign -- oh and then some. Basically regulatory reform with no mandates or subsidies.

This has the feature that the Senate finance committee doesn't have to be involved at all (they are needed only because HELP can't expand medicaid). It also has the feature that regulatory reform is so popular that it can be filibustered only at great political risk. Finally it has the key feature that regulatory reform without a mandate would bankrupt the health insurance industry. The reason regulatory reform without a mandate would be terrible policy is that the reforms would make it optimal for healthy people to buy insurance only after they get sick. That is an argument which convinces me and sure convinces Ignani, but had no detectable effect on US voters.

Roughly the move is to say to Karen Ignani, you want mandates then give me a public option. Otherwise you can try to convince the American people that regulatory reform isn't really in their interests. Oh and remember how successful Clinton and McCain were.

I'd guess that Baucus and Conrad would discover that negotiating with Grassley is a waste of time roughly one day after Obama threatened to go back to his campaign's proposal.


Anonymous said...

August 21, 2009

Next Week's Budget News Today!

The U.S. government is on an unsustainable fiscal trajectory as far as Medicare and Medicaid are concerned. Whether it is on an unsustainable fiscal trajectory as far as the rest of the budget is concerned depends on (a) what is finally done about Medicare and Medicaid, and (b) whether the economic growth rate over the next three decades is closer to 3.5% per year or to 2.0% per year.

-- Brad DeLong

[So, right after striking fear in hearts about Social Security, the supposed Berkeley liberal decides to undermine support for Medicare.]

Anonymous said...

There we have the supposed Berkeley liberal who never found a war he could not support, who has decided that spending $737.9 billion on the military in 2008 and more now and more in 2010 asked for is not problem. What are the problems? Social Security and Medicare.