Or are you all happy about having a handful of for-profit health insurance companies eat your lunches? And dinners, and breakfasts, and then anything edible anywhere, until we all starve together? If not, then why the devil are you not discussing this with your business-friendly senators and representatives? If you haven't noticed, you have something of an emergency on your hands. The possibility that a "moderate" version of health care reform might be enacted should have frightened you into stopping it months ago. It's not too late to act, but it's far too late to wait and watch and tell yourself that if there were anything to worry about, the mainstream financial press would have told you so.
What, you don't think so? You're free-marketers, you say? You don't think government regulation is ever a good thing, and you certainly don't think government should or could do as good a job providing services as private enterprise can?
Well, that's a pretty theory, and I understand why you like it. But like a GPS directions system that hasn't charted a chasm in your path, it's about to walk you right over a cliff. So take your eyes off that screen for a moment, and follow me beneath the fold for a look at the actual terrain in front of you.
Well, ladies and gentlemen? Have we turned the ideology off? (I'll let you turn it back on again at the end. If you're still fools enough to want to, that is.)
Now, let's take a look. You've all heard about this healthcare reform thing working its way through Congress, even if you've been busy with other things this summer and haven't been paying serious attention. You know there's a technical argument about something called a "public option," but maybe you don't know much about what it is or whether it's really important -- after all, it's not like the Wall Street Journal is focusing on it. And you expect to be able to maintain your own gold-plated policy whatever happens.
So your warning system hasn't make much of a fuss about this neat provision in the Senate Finance Committee's proposed reform bill:
Personal Responsibility Requirement. Beginning in 2013, all U.S. citizens and legal residents would be required to purchase coverage through (1) the individual market, a public program such as Medicare, Medicaid, the Children‘s Health Insurance Program, Veteran‘s Health Care Program, or TRICARE or through an employer (or as a dependent of a covered employee) in the small group market, meeting at least the requirements of a bronze plan, or (2) in the large group market,. . . .
Oh, sure, there are various supposed affordability provisions. But with a federal deficit that's already frightening the horses, our so-called moderates in the federal government are trying to keep subsidies to consumers as low as political considerations allow. (As CBS News' report on reform myths has it, "Indeed, the Blue Dogs convinced their Democratic colleagues to cut government costs by reducing the amount the government will spend in subsidies to make health care more affordable for low- and middle-income Americans.") And with the average cost for a year of family coverage hovering around $12,500 in 2008, and expected to go up, there's likely to be a significant gap between subsidized costs and costs each American consumer is expected to bear.
So far, so good -- for the insurers. They're going to gain a whole new customer base who'll be forced to buy their products.
But, what about your products?
Consumer spending, as we all know, constitutes anywhere between 40% and 70% of GDP, depending on how you run the numbers. Assuming the low end, which represents most actual out-of-pocket spending by individuals, that's still a critically large percentage of domestic economic activity. That's people buying new cars, or not; going to their local malls and buying lots of Christmas presents, or not; taking the kids away for a vacation, or not; putting together a down payment on a house -- even a short-sale house -- or not.
We already have a serious economic contraction underway, driven in part because people can't afford to do these things, or can't afford to do them as lavishly as they once did. Things are fragile, at best. So, just what do you captains of industry think is going to happen, when whatever bits of discretionary income households can still put together is suddenly hoovered up into the maws of the for-profit insurers?
Can't guess? That's all right, I can tell you. The person who would have bought the new office furniture Ms. Furnishings is selling is going to go without, or find an old fixup desk on Craigslist. The one who would have bought a back-to-school wardrobe for her daughters at Malls'R'Us will band together with her neighbors and have uniforms adopted for her school district. Anything else the girls need will be provided by Grandma, who's not going to be going on vacation or getting her kitchen redone. Show me a consumption pattern your business depends on, and I'll show you a bunch of your customers who can't afford to do that any more.
Seeing catastrophe? You should be: this stuff is a recipe for widespread disaster, for you as much as for those now way below you on the economic ladder. (As for why your analysts and news media and such haven't seen fit to warn you about this -- well, hell, your guess is as good as mine.)
So it's past time for a little application of enlightened self-interest, don't you think? There's one thing that can prevent this particular cascade of disaster, and that is for health insurance to actually be made reasonably affordable. If it is, the burden can be shared between government and individuals in some equitable way without sucking all of the disposable income in the United States into the hands of a single industry, leaving none to keep the rest of the economy afloat, and without a disastrous explosion of the deficit.
That's what a strong public option -- that mysterious buzzphrase - is designed to do. By creating an insurer that doesn't need to generate profit or outsize compensation for executives, and that doesn't reward denial of claims, it would be able to charge lower premiums than the for-profit insurers have felt able to offer, and still break even. Further, it would put competitive pressure on the for-profit industry itself: not an unreasonable thing even for devoted capitalists to contemplate, given the upward spiral of profits in the industry, and its highly concentrated nature at present.
You titans of industry, you CEOs and CFOs, you Wall Streeters: you've got doors open to you in the Senate and the House of Representatives. It's past time you used them. The moderates and deficit-hawks of the Democratic Party will listen to you when you tell them the country needs to do this -- they understand you to be experts, and are open to your advice. The White House will listen too.
You need to get onto this, and damned soon now. We're on the same side here, like it or not and ideology be damned: if we foot soldiers go down, it's all over for you as well.
Think it over. Think carefully, but not for too long. Right now, he who hesitates is likely to be extremely and unpleasantly lost.
-- And so endeth the lesson. You're free to turn your usual guidance system on again now, if you insist. But as a veteran of too many fights gone wrong, I advise you not to. Trust an old soldier: you're safer without 'em.