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The politics of health insurance

By Richard E. Ralston
web posted November 3, 2008

There are some noteworthy differences between the health care policies advocated by Senators McCain and Obama. Both candidates, however, share fundamental flaws that make either set of proposals largely undesirable and impossible to implement.

Both Obama and McCain talk about the status quo in American medical care as if it were just created by Adam Smith on free-market principles. Both state that "health care is broken" without explaining how it was "broken" and by whom.

Both ask Americans to believe that if increasing costs are the problem, government is the solution—without any evidence from the last two hundred years to support such an absurdity. In fact, over the last forty years, government regulation of insurance has rapidly increased, and government now pays for and directly controls 50 percent of medical care. Is that any indication that government should get more involved?

Senator McCain does at least seek to put personal choice back in the hands of individuals and allow everyone to buy insurance in a free and competitive national market. He is friendly to the use of Health Savings Accounts. He would like to preserve the few pitiful choices and options for senior citizens in Medicare Advantage plans.

But McCain wants to hand government cash to those without insurance by taxing the insurance of those who now have it. Employees who have received tax-free insurance from their employers for the last sixty years are unlikely to welcome this change, and politicians are unlikely to implement it. It is certainly inequitable for those who struggle to buy their own insurance to do so from after-tax income. Equity could be better achieved by simply allowing them the same tax break received by those with employer-based insurance. The government can be better trusted to give everyone the same tax break than to take taxes from some in order to write checks to others.

Senator Obama wants to replace the Medicare Advantage options that millions of seniors have flocked to, and force them into the single, monolithic mold of Medicare. He seems to share the mentality that those who cannot afford their own health care can afford taxes on the income they need to pay for it. He wants to protect and increase all the mandates imposed by special interests and imprison many in the regulations and inflated costs of the worst states.

Obama would fund his insurance proposals primarily by raising taxes on the rich, without regard for the fact that he has also committed all of those new taxes to provide tax cuts for 95 percent of American workers. Those new revenues are also entirely committed to providing additional Medicare prescription benefits and rescuing the current government obligations to Medicare. They are also committed to eliminating the budget deficit (but even if they were dedicated to that purpose, they are no longer sufficient, as that deficit is wildly escalating).

Neither candidate, if elected, would have any means of funding their proposals for the foreseeable future. Both base their proposals on the idea that the best way to make medical insurance available to more people is by making it more expensive for those who already have it. Both feed the illusion that individuals can rely on others to assume the duty to supply them with all the medical insurance they might want, without telling each individual that they must in turn become responsible for providing medical insurance to everyone else. Both think that converting medical records from paper to computers—which has been underway for years—will automatically reduce medical costs.

At best, any advantages that one of the candidate's proposals might have are cold comfort in the face of the relentless growth of overall government intrusion in medical care. As our choices and freedom gradually slip away, we are likely to wake up after the next election, or some election in the near future, to a nation in which a government that has all medical care in its grasp acts as if it owns our bodies. It will, after all, be paying for them. ESR

Richard E. Ralston is Executive Director of Americans for Free Choice in Medicine, Newport Beach, California. Copyright © 2008 Americans for Free Choice in Medicine. All rights reserved.


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