The Poisoned Chalice

There he is, poor Sen. Harry Reid (D-NV), facing a brutal reelection bid next November, mercilessly diverted into trying to make an omelet out of rotten eggs.

That’s what the public option is. It’s a rotten egg cooked up by some Democratic policy analyst to make a government give-away look like genuine health insurance.

Now poor Harry has had to throw out the public option and replace it with a bodged-up scramble with an expanded Medicare and an expansion of the health plan offered to federal workers. He is just waiting for the Congressional Budget Office to score it. Well, here’s another score: usgovernmentspending.com’s chart of government health spending from its Spending Briefing. Red is federal, green is state, and gray is local.

Back in 1965, government spent about 1 percent of GDP on health care. The life expectancy of Americans at birth was 70 years. Today the government spends 8 percent of GDP on health care and the life expectancy at birth is 78 years. You tell me if it’s worth it.

The chart tells you why Democrats are having such a problem launching the good ship Health Care. They are no longer in the position of promising the American people glorious benefits now to be paid for by undefined rich people in the distant future. Government health care costs a bundle right now. The rot set in after World War II when the federal government first mandated that hospitals receiving government construction grants had a legal duty to treat poor people for free. Health care costs really got going in the mid 1960s when government decided to subsidize the health care of the elderly and the poor with Medicare and Medicaid.

With government in control we have got the health care you would expect. We have costly regulation. We have cartelization and unions. We have credentialism. We have politicians like Harry Reid trying to make a silk purse out of a sow’s ear with our money.

Harry’s problem is yet another predictable Unintended Consequence of any government spending. As health care costs rise to pay for the government interventions, more and more people clamor for subsidies because they can’t pay the government-mandated higher costs. Naturally, the people already benefiting from government subsidies get nervous. After all, they should come first.

Poor Harry Reid. He’s the guy left holding the poisoned chalice of liberal health care fantasy. And he might lose his Senate seat over it.

Nothing is new here. It’s a wonderful thing to imagine giving health care to the elderly and the poor and to the helpless uninsured. But when the government does it, it is not just giving. It is taking. Crusty Herbert Spencer saw that over a century ago in “The Proper Sphere of Government” from Man Versus the State. He started with the evil of a national religion. An establishment of religion, he argued, was bad, substituting form for reality, ceremony for practice, and the physical for the spiritual. Established charity was just as bad.

The payment of poor rates will supplant the exercise of real benevolence, and fulfillment of legal form will supersede the exercise of moral duty... When the legal demand is paid, the conscience is satisfied; charity is administered by proxy; the nobler feelings are never required to gain the victory over the selfish propensities[.]

Maybe that’s why liberals give less to charity than conservatives, according to Arthur C. Brooks in Who Really Cares?

Once government starts handing out benefits then the scramble is on for a share of the spoils. Pretty soon the government starts cheating; it wants to escape the full cost of its promises, for instance, with price controls on payments to Medicare providers. Naturally the poor get screwed. Payment schedules for Medicaid are even lower than Medicare.

So here we have Harry Reid left holding the poisoned chalice of government health care. And now we learn that budget genius Peter Orzsag doesn’t really know how to bend the cost curve, according to the Wall Street Journal edit page guys:

As Obama budget director Peter Orszag put it at a revealing media breakfast earlier this month, the Senate bill does everything the experts recommend to "get at the underlying drivers of health-care costs." While he admitted that "we don’t know enough" to produce results right away, the key is to encourage "continuous improvement" through pilot programs and demonstration projects. Cost containment will actually take "years to decades," Mr. Orszag conceded.

The truth is that Democrats will never wake from their dream of government administered heaven on earth until brought to the edge of the electoral abyss. Perhaps the voters, in their kindness, will help with this project next November.

Christopher Chantrill blogs at www.roadtothemiddleclass.com. His Road to the Middle Class is forthcoming.

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The Poisoned Chalice

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