The health care reform passed this weekend with a reconciliation vote of 220 to 211. Support for the bill was strictly party line, with 220 Democratic votes. Opposition to the bill was bipartisan, with all 178 Republicans and 33 Democrats opposing the bill's passage. (source: House Clerk)In response to the passage of H.R. 4872, the "Health Care and Education Affordability Reconciliation Act of 2010," (full text here) the Internet is abuzz with questions like "What does the health care bill mean to me?" which is a trending topic on Google, along with "new health care bill pros and cons," "healthcare bill summary," and "obama health care plan explained."
Oh now you're interested? You couldn't have bothered to search for these questions before the bill passed, and determine your opinion in time to make a difference in its passage? Hmm? Okay. Whatever. At least you're paying attention now.
Let's break it down:
What does the health care bill mean to me?
Price Fixing: the Democrats' health care plan adds all kinds of Federal price and quantity controls to a health care market that is already rife with price and quantity distortions. Indeed, the main problem with health care is the myriad price distortions that inflate costs and quantity distortions that restrict access. So what does that mean to you? That the new health care bill takes your existing problems with the health care industry and only makes them worse. Even one of President Obama's own economic advisers acknowledges what most economists believe: "Price and exchange controls inevitably create harmful economic distortions. Both the distortions and the economic damage get worse with time."
Rationing: Yes- you better believe it! The truth is that rationing always occurs in any market. The basic problem of economics is that there are only limited resources to satisfy our unlimited wants. Prices are the the most rational rationing mechanism. If we dispense with those, then we have to use another- the judgment of bureaucrats and legislators backed by the force of government. Fixing prices necessarily affects quantity. Artificially forcing them down as the new health care bill attempts to do restricts quantity and creates shortages. If you don't know how to read the following micro-economic graph, here's a short primer.
Believe it or not, the new bill simply means less, not more access for you. Get ready for longer lines, worse waiting lists, and more rationed care. Search the text of the bill... the words "eligibility" or "eligible" appear 56 times. Some version of the word "qualify" appears 20 times. Contrast this with the word "privacy," which appears exactly zero times in the bill. Or "doctor," or "freedom," or "Constitution," which are all likewise absent.
More taxes: The word tax appears in the new health care bill 125 times. Even Democrats admit that this bill spends one trillion dollars of your money. One trillion! At a time when we have already spent trillions and trillions more dollars that we just don't have. What an incredibly stupid, short-sighted, irresponsible, economically suicidal thing to do to the American people! And in the middle of a recession of all times to do it! The sad thing is that the price tag will be inevitably higher as history tells us. Bills always costs more than Congress projects. Cato's Michael F. Cannon explains why the price tag for this new health care bill will really be three trillion dollars.
A longer recession: How can Americans afford a three trillion dollar hit to our economy? How does it create value for us to destroy three trillions dollars worth of productive capital by misallocating it and using it to create more distortions in an already distorted system? The poor and underprivileged who this bill is purported to help, will suffer the most under its fiscal and monetary burdens. Higher taxes to pay for this Federal power grab will hurt job growth and take even more income from working class Americans.
As the Treasury fuels this spending by issuing more bonds (i.e. taking out loans from lenders) it will continue to hog an already crowded credit market, pushing out businesses and hurting growth- again killing jobs. The Fed will then finance most of this debt, buying up Treasury bonds with printed money. As that money circulates in an already inflated monetary base, prices will go up. America's poor who already barely have enough to pay for electricity, gas, and groceries will be broken by the rise in prices of the things they need to live.
Obama had the audacity to call this the American dream.
Less Choice: Your choices will be restricted in the new health care system. The word "choice" appears only twice in the new health care bill. It still includes the individual mandate, which requires that Americans purchase health insurance or pay a Federal penalty. Can you believe that? A bill which allegedly sticks it to the health insurance companies delivers your captive dollars to them whether you want to pay for their services or not. If you choose to purchase more coverage than the Federal government thinks you need, you will also incur a penalty. If you are a small business owner with more than thirty employees, and you choose not to provide health insurance, you will also have to pay a Federal penalty.
How on earth does Nancy Pelosi have the gall then to stand in front of America and say that this bill helps disentangle health insurance from employers? How can she say it's good for small businesses when it adds just one more burden to their already over-burdened, over-taxed budgets? How can she say its good for jobs when it will destroy the jobs of every worker whose marginal profitability to the business is less than the added cost of providing them health insurance? This bill restricts America's already restricted health care choices and worsens its already staggering problems.
Moving forward
By the way, we don't just complain here at THL, we offer real, practical, non-partisan solutions that will help make life better for Americans. Read how we can strip the health insurance companies of their monopolistic power in one easy step. This is a very simple, but revolutionary solution, and it's never too late to get our Congress to make this happen.
