Reality is merely an illusion, albeit a very persistent one. - Albert Einstein

The Public Option Reloaded

by Hal_10000

Sullivan today, on the “public option” re-appearing in an “opt-out” form:

The Dish always thought it was viable because the logic behind it makes sense to anyone with a brain, because it would save money, because it is actually popular and because the opt-out option squares the circle nicely.

Almost every single word that sentence is dripping in bullshit.

First, the public option will not save money.  Not without either rationing or forcing providers to participate at low reimbursement rates.  The latter would constitute an indirect subsidy worth hundreds of billions of dollars.  As Samuelson, in a must-read article says:

The promise of the public plan is a mirage. Its political brilliance is to use free-market rhetoric (more “choice” and “competition") to expand government power. But why would a plan tied to Medicare control health spending, when Medicare hasn’t? From 1970 to 2007, Medicare spending per beneficiary rose 9.2 percent annually compared to the 10.4 percent of private insurers—and the small difference partly reflects cost shifting. Congress periodically improves Medicare benefits, and there’s a limit to how much squeezing reimbursement rates can check costs. Doctors and hospitals already complain that low payments limit services or discourage physicians from taking Medicare patients.

As I have pointed out, Medicare’s supposedly low overhead is based on borrowing infrastructure from other agencies and—most notably—running their insurance plan so badly that it is a cesspool where corrupt agents can become millionaires and honest docs are hurting.  The public option is likely to be worse than this.  We’ve seen a preview of it in Fannie Mae and Freddie Mac—the “public option” mortgage companies that were at the heart of the housing crisis, had to be bailed out to the tune of hundreds of billions and dollars and, unlike the TARP companies, are being allowed to pay out huge bonuses to their execs.  That latter point is something to bear in mind.  Once Fannie Med is created, it will, like the mortgage companies, produce a raft of highly-paid government-controlled jobs for political cronies.

Second—is the public option popular? If that’s so, why are the Democrats desperately trying to rename the public option to something less politically lethal?  Even if it is popular, that doesn’t mean anything.  If I argued that gay marriage bans should be passed because they’re popular, I doubt that Sullivan would agree.

Finally, there’s the claim that this is “squaring the circle” politically.  Translation: if Republicans hate the public option, then red states can choose to opt of the system; therefore there should be no objection.

But that is a massive misrepresentation.  Red states will have the option not to get the insurance.  But they will not have the option to evade the cost shifting the plan is likely to create.  They will not have the option to avoid the direct and indirect subsidies that Fannie Med is almost certain to require.  They will not have the option to stick with insurance companies that are bankrupted or interstate companies that dump their private insurance or terrible business practices that become the industry standard (as has happened with Medicare).  The “opt out”, such as it is, is the opportunity to get out of the benefits of the public option will still bearing the costs.  That’s like a store offering to let you “opt out” of having to take home their merchandise while they continue to run up your credit card.

I guess I’m just not “anyone with a brain”.  But I’m not alone in my brainlessness.  Apart from Samuelson, there’s Roger Pilon, Michael Cannon, Megan McArdle, Greg Mankiw and Peter Suderman and Ronald Bailey.  Even Tuesday Morning Quarterback is in on the action, arguing that our first step should be to replace comprehensive healthcare with major medical.

So other than being completely wrong about everything, it’s another great post from Sullivan.

Comments

Posted by on 10/27/09 at 01:59 PM from

It really is amazing the way Sully’s obsession with Obama has completely drained whatever sense he had left in his head.

Posted by on 10/27/09 at 02:55 PM from

This guy is such a fucking tool. What was the obsession with him? Was it because of the perception that he called out Bush & Co.? For a while, every post referenced this guy. I’m glad he is being shown for what he is, which is a fucking tard.* Which is an insult to tards everywhere.

* the word, “tard,” is being used in a tongue-in-cheek way to prove a point. It, in no way, is meant to disparage those with mental or developmental disabilities.

Posted by on 10/27/09 at 09:30 PM from

I don’t know what’s happened to Sullivan...his original blog was excellent, (and I’ve read it for years) and represented true independent thinking. His gradual disillusionment with Bush was insightful to read, and represented real thought (and almost anguish) about abandoning someone that he supported. (And read his essay My America to see a truly beautiful love letter to the United States.)

Now, it’s like his site is written by a different person. It’s blind “Obama good, Republicans bad” bullshit, with a continuing unhealthy Sarah Palin obsession thrown in. (I don’t like Palin, but Jesus give it a rest already.) This post is probably the last one I’ll read on his site. The “anyone with a brain” comment finished it for me. It’s the laziest form of thinking to dismiss disagreement by saying that the opposition is simply too stupid to understand the issue.

Posted by Hal_10000 on 10/27/09 at 11:12 PM from

IN fairness, I dismiss argument in the heat of the moment with ‘anyone can see’.  I think Sullivan is experiencing what he did with Bush—he’s enraptured by a public figure and can’t quite see the flaws in the facade.  He will.  Eventually.

Posted by on 10/28/09 at 12:36 AM from

I think Sullivan is experiencing what he did with Bush—he’s enraptured by a public figure and can’t quite see the flaws in the facade.  He will.  Eventually.

At which point he’ll just latch on to some new political flavor of the week, so really nothing will change. Sullivan is too juvenile most of the time to take seriously.

Posted by AlexinCT on 10/28/09 at 06:39 AM from

I hear Nancy Pelosi, after spending a bunch of tax payer money on more meaningless surveys, and taking a page from the abortion campaign crusaders, has decided that the way to overcome the public perception, dislike of the proposed agenda, and the general list of problems with the healthcare takeover by government that these democrats want, is to rename the public option to something else, something more appealing, and hope the rubes don’t catch on quick enough. You can not make this crap up! Why the hell are we allowing these bastards to constantly rename evil and horrible things in order to fool people and make them palatable again?

What’s next? Are they going to rename “brutal child rape” into something more pleasant sounding and less threatening, and get Polanski off in court too?

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