Promises (You Knew You’d Never Keep)

Over the past several weeks, I have talked with a number of people about the healthcare proposals being floated by Congress. For those in favor of these proposals, it was not surprising to me that they knew little of the details of the proposed legislation or its far-reaching implications, and even less of the fate of similar federal government programs such as Medicare and Social Security. They speak in broad generalities with moral tones, instead of providing reasoned arguments as to why this particular legislation should be passed and specifically why it is the solution. Supporters appear to have such faith in government that they don’t care about the details of any of these programs, as long as they deliver on their promises. They haven’t considered that the proposed healthcare legislation may not be the solution. Simply because Congress says they are proposing a solution, we are supposed to accept this assertion as prima facie fact, and if we don’t, then we’re “for the status quo” as Obama has said numerous times, parroted by almost every Democrat in Congress. Yet as I stated before in a previous post, ignorance is not so bliss. Someone is going to have pay for this expensive brand of “reform,” which in the House version is 1990+ pages of pure confusion designed to obfuscate the true cost to American taxpayers, and moreover, to hide the government’s intent to eventually control an additional 1/6 of the entire US economy.  The taxes to pay for this monstrous piece of legislation begin immediately, but the benefits, coincidentally, won’t materialize until 2013, after the next presidential election. So why the mad rush to pass such sweeping legislation if there is no immediate benefit, while there is immediate pain to businesses struggling to emerge from a deep recession? And if the need is as dire as they claim, then why such a long wait?

Given this, there are a number of observations I have made that give me great pause, so I hope all of you apologists of the current healthcare reform proposals will take note as well and consider the following:

1. The President and Congress are attempting to demonize the health insurance industry for making “massive profits” and resisting the public option because they “don’t want more competition.” Yet it is public record that the health insurance industry, on average, makes about a 3.3% annual profit. If Congress considers that massive, what do they have to say about beverage companies or software companies, who regularly report annual profits in excess of 20%?  I am no apologist for insurance companies, and am well aware that some have engaged in unethical practices, but these are hardly representative of the entire industry. If they were, Congress could simply pass laws that make such practices illegal. It is unbelievable to me that people are so outraged over executive compensation for successful insurance companies that haven’t taken a dime in government bailouts, even though their businesses run on razor thin profit margins. Even if insurance company executives were all to take no pay in salary or bonuses, the difference in insurance premiums wouldn’t be noticeable, because they are a tiny fraction of total revenue. Regarding insurance premiums, if you were to strip away all health insurance profits, this would result in only a $100-200 in annual savings, so there are no significant savings with non-profits. And let’s not forget that “greedy” insurance companies gainfully employed nearly 470,000 people at an average annual salary of $61,409 in 2004. They’re creating jobs that you and I need to take care of our families, as all private companies do. So it is not my concern, and it should not be yours, as to what executives make in a competitive, market-driven economy, as long as they are competing lawfully and ethically in the marketplace. If you do care, then quite frankly, you’re simply envious and need to face up to it (even worse, you don’t respect private property rights as guaranteed by the Constitution). Personally, I have only worked for rich people my entire career, and I have never begrudged their success because their success also became my success when I freely joined their company.
2. As I have stated in previous posts, there was nothing previously and there is nothing now in either the proposed House or Senate bills addressing common sense reforms that will truly lower healthcare costs, such as medical lawsuit reform, marketing insurance across state lines in order to prevent state monopolies and increase competition, tax benefits for individuals and small businesses that only corporations now enjoy, and the reduction of state mandates that force individuals to pay premiums for services they don’t need or desire. If these bills become law, they will only create another bloated and expensive federal bureaucracy that will insert itself between doctor and patient, while lowering reimbursement rates and cutting benefits for the elderly in order to contain the additional costs it will create. And yes, there are a number of Republican proposals that address the real issues in healthcare and encourage increased competition in the private sector. These proposals work with the states (which is at least constitutional) to ensure coverage for those with disabilities and low incomes, but none of these proposals have been given reasonable consideration by a Democrat-led Congress, despite their feigning of “bipartisanship.”
3. I wonder if any proponents of the proposed healthcare reform have noticed that between Social Security (created during the FDR administration) and Medicare (created during the Lyndon Johnson administration), there are over $100 trillion in unfunded liabilities. That means they are both approaching bankruptcy, and there is currently no plan to address either.  Medicare is currently projected to be exhausted in 2017, and Social Security is expected to be exhausted in 2037. If Congress can’t or won’t tackle this clear and present danger that threatens the future retirement and healthcare of millions of seniors (many of whom regretfully are wholly dependent on these bad promises), what would give anyone confidence the current healthcare legislation that we already know will cost a minimum of $1 trillion over the next ten years won’t have a similar fate? In other words, why can’t supporters of this legislation see this is simply another government-sponsored Ponzi scheme being foisted on the entire public, as evidenced in the massive cost overruns for similar plans in states such as Maine, Tennessee, and Massachusetts? Well its because the intent is not to solve any problem, but to move us towards the single payer system Democrats want. And since Americans cannot appeal to a higher authority, the federal government can run a Ponzi scheme in full public view while Bernie Madoff goes to jail for life for doing basically the same thing. I would venture to guess he could run this scheme better than them, so if this legislation passes we could take him out of jail and send him to Washington where he would be with like company.
4. Healthcare run by the federal government as a “public option,” last I checked, is decidedly unconstitutional. The federal government was given specific, enumerated powers by the Constitution. What is surprising to me is that healthcare legislation supporters don’t seem to have the slightest concern that the Constitution is being trampled in the process, mainly because they are ignorant of the Constitution or don’t seem to understand how relevant it is to ensuring the continued prosperity and rule of law in this country. Anecdotally, my friends who have emigrated to America from socialist countries almost universally believe that since their native countries provide universal healthcare, that the United States should follow the same model, as if there were no other humane solution. But what is also almost universal is their lack of knowledge of the Constitution, which only reflects how little native Americans know about and respect the Constitution. If Congress won’t respect the Constitution, then why should anyone? My point is that there is a way to provide comprehensive healthcare reform within the private sector and the public sector at the state level that respects the Constitution. The Republican proposals are far closer to that ideal than the Democrats, who aren’t offering anything constitutional, and quite frankly, don’t care. If this bill gives them more power and control over the people, they are going to push to get this bill passed no matter how many Americans oppose it.

The bottom line is that just as it did with Social Security and Medicare, the government is making promises that it knows it can’t ultimately keep. And when the government makes promises, people expect the government to keep them, even if they are simply too good to be true. As long as the government continues to have the power to raise taxes or raise more debt, the folks in Congress know they can continue to “kick the can” down the road so when their “solutions” ultimately fail, they will be long gone and drawing a pension as a part of the elite class. If there is one thing members of Congress know, it is that the American people have a short memory and will not ultimately hold them accountable. That is precisely what is occurring now with this intentionally convoluted, byzantine healthcare legislation currently being proposed. It represents promises that cannot be delivered on, while disrespecting the Constitution and the American people in an attempt to dismantle the world’s finest healthcare system that is simply in need of sensible reforms, based solely on deeply flawed political ideology. I believe that Congress has seriously miscalculated on this one, as the American people know that continued increases in taxes and federal debt are a recipe for economic disaster in an already fragile economy. The former will only hurt economic growth, while the latter will make us slaves to those whom we are indebted. If this legislation passes, my prediction is that nothing good will come from it, but plenty of bad things will.