Blame Obama's lack of a real plan

The conventional wisdom is that Barack Obama is in trouble over government health care. The truth is, government health care is in trouble over Barack Obama.

True, some of the president's political troubles stem from the inflated expectations of his supporters. There is a tendency in politics to invest unrealistic hopes in the election of "our guy" as a triumphant vindication of who we are rather than his probable performance in office. (See for instance the boppy 1952 "I Like Ike" ad at where the sun rises again because we've sent Ike to Washington not because of anything we expected he'd do once he got there which, indeed, he largely did not.) But that's a side issue.

The main problem is that there never was a health-care plan. There was simply an assumption, as persistent as it was unrealistic, that government could easily provide more health care for less money, more fairly, than the private sector. What has driven Republicans out of the bipartisan reform effort, while giving so-called "Blue Dog" democrats the cold robbies about the probable political, fiscal and medical results of this reform, is that it was meant to save money yet has been revealed as horribly expensive.

The non-partisan Congressional Budget Office (CBO) fired a pair of deadly broadsides in June, first saying the health bill before the Senate Finance Committee would cost an extra $1.6 trillion over a decade, then declaring that rather than the supposed savings in the second decade would be an even steeper increase in spending. Now the naive would ask, if the plan is meant to save money, why is it so much more expensive? The skeptical would ask, what possibly made you think increasing the role of government would save money?

Recently supporters of the administration have turned to a health insurance co-op lack-of-plan as an alternative, or perhaps a supplement, to the government insurance lack-of-plan. The administration denies changing its lack of position. But it doesn't matter. There's no there there either.

Why would there be? Can anyone name one thing government provides more efficiently than the private sector? I concede that there are things the private sector cannot provide, like defence and criminal justice. But there are not as many as people think and they all turn on the familiar triad of free rider, holdout and transaction cost problems.

To say the state must do things like defence and justice is not to suggest that it is likely to do them efficiently. Rather, mankind has long searched for mechanisms like representative democracy, separation of powers, federalism, decentralization, property rights and a vigilant citizenry to prevent it from doing them cruelly and wastefully. But admirable as these devices are, they cannot work as well as consumer sovereignty. They're just necessary where markets can't operate. And there is no reason to think health care fits into that category. So why cling to the expensive disaster of state-run medicine?

Not just here, either. Most Canadian defenders of our system dishonestly insist that the United States has little public health care. But in fiscal year 2009 Medicare and Medicaid, the two largest U.S. federal health programs, accounted for 41 per cent of Washington's $3.1-trillion budget, gobbling up over a trillion and a quarter dollars between them. Worse, before the current debate began, the CBO already warned that without effective cost control the two Ms would consume "13 per cent of GDP in 2040 and 38 per cent of GDP by 2082." Finding ways to make this system enormously more expensive is clearly pointless politically and medically.

A recent MSNBC news story said "a plurality of Americans now oppose a government-run plan." But that's not quite right. It's not a matter of the public turning against a workable plan thanks to rude conservative extremists hijacking town hall meetings. The public is realizing there is, in the proper sense of the word, no plan, just a disposition to spend vast sums while trusting central planning to muddle through.

Try asking any of its defenders why, if the Canada Health Act is such a good idea, we shouldn't adopt a similar Canada Car Act, Canada Software Act or Canada Food Act? They will laugh dismissively, as though your question were deliberately vulgar. But they cannot answer it seriously because everyone instinctively knows the devastating answer given 200 years ago by Thomas Jefferson: "Were we directed from Washington when to sow, and when to reap, we should soon want bread." The same is true of health care. Consider only that the British system, unlike ours, covers dentistry, and they have waiting lists for dentists as well.

That Barack Obama didn't realize this, and made absurd promises based on his lack of realization, is a negative reflection on the man. But the problem that now exists isn't that he wasn't magic. It's that government health care isn't.

[First published in the Ottawa Citizen]

ColumnsJohn Robson