Ph.D. Octopus

Politics, media, music, capitalism, scholarship, and ephemera since 2010

Universal Healthcare in a Capitalist Universe

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So I mostly agree with Wiz’s post about healthcare. It is a right, and in principle, should not simply be treated like a commodity, subject to the market. I’m Canadian, and I believe in single-payer. Of course, Canadians don’t usually use terms like “single-payer,” or “socialized medicine.” We might use the term “universal healthcare,” to show that we know it’s important that everyone gets treated, and nobody gets bankrupted because of it. Our system is better, and we know, and the stats back us up.

But, and here’s the big but, healthcare still has costs. As long as we function in a capitalist world, controlling those costs are important. As my friend Josh Barro astutely wrote :

America’s health care problems are in two parts: too many of us don’t have insurance, and those of us who do, eat too much care at too high a price. Attempting to fix the first problem without attacking the second will only make health care more intolerably expensive in the long run.

One way to lower costs, of course, would be to have single-payer insurance. I would support that wholeheartedly. I hope American gets there eventually. The question is how to get there. And the answer seems to be through incremental reform.

Another way to lower costs would be to institute the “public option.” This is nowhere near as good as single-payer, but it’s better than the status quo. Unfortunately, this also doesn’t look like a possibility in the near future. So while I would support this too, I think again that America will get there through incremental reform.

So what is left, in terms of cost-cutting measures?

One method, a key trope on the right, is “tort reform.” The left should embrace this. It is a good idea. Another reason that Canadian healthcare is better is that Canadians aren’t sue-happy, i.e. they don’t constantly sue their physicians. This reduces costs for the doctors and also makes them feel more secure to practice better medicine. It’s a good idea on the merits, so accepting it shouldn’t even be seen as compromise, but merely as common sense.

Another method might be more controversial. That’s instituting a tax on the “Cadillac” healthcare plans. Many unions are opposed to this, because they fought so hard to get these good healthcare plans in the first place. But, if Wiz’s principles hold true, and we want to have a more corporate (in the old fashioned sense of the word) society, well then we should be willing to have these plans taxed.

Sure, the tax is regressive. But it will raise lots of revenue, and also reduce healthcare costs. So, like all taxes are at least supposed to work, people would be paying taxes in order to get cheaper, more efficient healthcare, and to provide access to those who were previously denied it.

Broadly speaking, I think the left should be willing to embrace certain regressive taxes, like the V.A.T. (value-added tax). This is a tax on consumption, so while the wealthier, who consume more, would pay more, the less wealthy would pay a larger proportion of their total wealth. But lots of countries more progressive than the United States have a V.A.T. Because, as Josh says, it’s a “money-making machine,” and it allows them to pay for other services.

Of course, I would support these measures in tandem with a more progressive income tax policy. Because I think the wealthier should pay more. But in a capitalist economy, we have to be mindful of the best way for welfare states to raise funds to support progressive policies.

Supporting tort reform, and the “Cadillac” healthcare tax, would be good ways for Democrats to show that magical, overblown sentiment known as “bipartisanship.” But it would also be right on the merits.

Eventually, America should get a public option. And after that, single-payer. Hopefully sooner rather than later. But the way there is through incremental reform, and cost-cutting measures such as those I mentioned above are importants means to get there.

PS. Incidentally, while I support single-payer, I believe that, as long as we do function in a capitalist economy, people should have a private option. In Canada, people can go private for certain things: tests like catscans, X-rays, ultrasounds, as well as psychiatry and dermatology. They cannot go private for major surgery though. I think people should be able to pay out of pocket for these things. This would make the government run system more efficient. As far as I know, many places in Europe have similar kinds of systems which have universal coverage and function more efficiently than the Canadian system (shorter “waiting lines,” which are really nowhere near as big a problem as the paranoid anti-government right makes them out to be). But the point is, have a universal, government run system as the base, guaranteeing healthcare as a right and ensuring nobody is bankrupted and keeping costs down, and then allow some private entities to make it more efficient.


Written by David Weinfeld

February 24, 2010 at 08:02

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