Flash: Americans Want Free Health Care
I certainly wasn’t particularly surprised to hear that a large majority of Americans want universal health care:
A majority of Americans say the federal government should guarantee health insurance to every American, especially children, and are willing to pay higher taxes to do it, according to the latest New York Times/CBS News Poll.
While the war in Iraq remains the overarching issue in the early stages of the 2008 campaign, access to affordable health care is at the top of the public’s domestic agenda, ranked as far more important than immigration, cutting taxes or promoting traditional values. Only 24 percent said they were satisfied with President Bush’s handling of the issue, despite his recent initiatives, and 62 percent said the Democrats — not the Republicans — were more likely to improve the health care system.
Americans showed a striking willingness in the poll to make tradeoffs for a better health care system, including paying as much as $500 more in taxes a year and forgoing future tax cuts. But the same divisions that doomed the last attempt at creating universal health insurance, under the Clinton administration, are still apparent. Americans remain divided, largely along party lines, over whether the government should require everyone to participate in a national health care plan, and over whether the government would do a better job than the private insurance industry in providing coverage.
No word on whether Americans also favor free beer and ponies.
I know that most economists on the left side of the aisle continue to believe that the key problem with our healthcare system is adverse selection i.e. they believe that the main source of increasing is is that insurance administration costs are rising because of the lengths to which insurance companies are willing to go to avoid covering the highest-risk people. That’s why they favor going to a single-payer approach in which the government becomes the only insurer. Economists on the right side of the aisle tend to believe that the problem with our healthcare system is moral hazard i.e. that people with government- or employer-provided health insurance have little reason to be thrifty in their healthcare choices.
My own view is that the main problem with our healthcare system is that the supply of healthcare is quite inelastic (as the economists say), healthcare costs are rising without a commensurate rise in healthcare outputs due to that supply bottleneck and because bureacratization is rising at all levels—insurance companies, government, hospitals, etc.—and going to a single-payer system with universal coverage will result in small economies which, without other reforms, will quickly be overwhelmed by cost increases in the system for the other reasons I’ve mentioned above. I also see no fiscally responsible way that we can have both universal coverage and open borders.
At least Democratic presidential candidate John Edwards is honest about healthcare reform: universal coverage will cost more. I think he’s underestimating how much more it will cost, at least over time.
Spending more on healthcare while preserving the supply bottlenecks of our healthcare system means we’ll be spending less on lots of other things including manufacturing, technology, and other service industries— the things that employ most people in this country.
I believe that we’re only going to get one bite at the healthcare reform apple for a generation or so. I’ll be very disappointed if that bite doesn’t include measures that will control the secular systemic causes of cost increases in the system while expanding the demand through a single-payer system with universal coverage.