The Healthcare Reform Fiasco

Barack Obama ran a brilliant campaign for president. Unfortunately for him, that strategic brilliance did not carry over to his campaign for healthcare reform. His push for greater government control of healthcare has struck a majority of Americans as radical, arrogant, and not so subtly lethal.

Obama is backtracking, trying to salvage some increase in government control. He dropped the proposal for government end-of-life counseling.

“Hello, Mr. Smith? I’m your government counselor. Tell me about yourself. How badly do you want to live? I’m sorry I can’t come over and meet you in person, but I have thousands of clients. Can you help me out and tell me why you should have priority in receiving life-prolonging treatment?”

Obama now claims to have dropped the “public option.” He is playing word games here. His explicitly stated ultimate goal (shared with virtually all liberal Democrats in Congress) is to nationalize healthcare, and he is still working to increase government control of healthcare as much as is politically possible.

Obamacare is not “socialized medicine,” as some critics claim, but this is a semantic technicality. My late economics mentor, Dr. Hans Sennholz, grew up in Nazi (national-socialist) Germany. He explained that the difference between socialism and fascism was that socialists seize ownership of businesses, whereas fascists let owners retain title to businesses, but wield dictatorial control over them. When it comes to healthcare, we see echoes of this in Obama’s August 16 New York Times op-ed, in which he proposed that Uncle Sam regulate which people health-insurance companies insure, the generosity of those benefits, and the prices those companies charge.

The fundamental flaw in the proposed healthcare reform is encapsulated in Nancy Pelosi’s assertion that the reform would mean “a cap on your costs, but no cap on your benefits.”

Well, that would be grand. But that’s not how the world works.

It is an elementary economic truth that price ceilings produce an excess of demand over supply—i.e., a shortage. Shortages breed political rationing, as happens regularly in Canada, Britain, and other countries with government-provided healthcare.

The prospect of being at the mercy of government bureaucrats for access to healthcare can make one feel as queasy as looking into the barrel of Dirty Harry’s .44 Magnum and hearing him taunt, “Are you feeling lucky, punk?”

Americans don’t want to be drafted into a government-run lottery for health and life. We oppose Obamacare because we don’t want government officials deciding who gets what treatments when. Such awesome power may never be abused here the way it was recently in Honduras, where deposed president Manuel Zelaya threatened to withhold government-funded healthcare from his political opponents; however, it is naïve to believe that one’s political connections won’t affect who gets the best healthcare. The members of Congress who sit on the House committee crafting the reform bill already proved that point by exempting themselves from Obamacare; they have preserved an exclusive, superior healthcare plan for themselves.

As in Orwell’s Animal Farm, in the progressive world of government-dominated healthcare, all citizens will be equal, but some will be more equal than others.

Obamacare needs to be defeated in its entirety. The president’s current tactical retreats and apparent willingness to compromise are designed to get the proverbial nose of the camel of nationalization inside the healthcare tent.

Yes, reform is necessary to keep the healthcare blob from devouring the American economy. Since the last time Democrats tried to nationalize healthcare 15-16 years ago (the so-called “Hillarycare” episode), healthcare as a percentage of the national economy has increased from 14 to 17 percent of GDP. But the reform that is needed is not more government control, but less.

How can Barack Obama, Nancy Pelosi, Barney Frank, et al. endorse in good conscience a government monopoly of healthcare, given the undeniably wasteful, inefficient, and sometimes corrupt record of government monopolies? If our political leaders really wanted to bring some discipline to healthcare costs, they would adopt policies that lead to more competition, not less (for example, by allowing insurance companies to compete for healthcare customers across state lines).

Obama promises to make healthcare more affordable. It’s hard to have confidence in government’s ability to accomplish this goal. Look at the disastrous results of Uncle Sam adopting policies to make home ownership more affordable. Medicare already has racked up over $35 trillion of unfunded liabilities. Do we really want to increase government’s involvement in healthcare? We should recall that the explosion in U.S. healthcare costs began with Uncle Sam’s entry as a driving force in healthcare via Medicare and Medicaid in the 1960s.

This is one of those issues where Ronald Reagan would say, “Government is the problem, not the solution.” Obamacare is quackery, a “cure” worse than the “disease” it purports to treat. It’s time to go back to the drawing board, and look to free markets rather than central planning for a viable solution.