Healthcare is a multiplier, not a consumer good

Adam Davidson tells a personal story about a relative who, with health care, could’ve continued his career. Without that healthcare, he ended up addicted and in jail. What the GOP doesn’t get about who pays for health care:

However, dividing health expenditures into these categories misses an important economic reality: health-care spending has a substantial impact on every other sort of economic activity.

Healthcare isn’t consumption, like buying a TV or going to a movie. It is a Keynesian multiplier. Every dollar the government spends on it means an individual or business can spend more than a dollar on something productive in GDP terms.

UPS and FedEx can’t exist without public roads. Southwest and United Airlines can’t exist without the FAA. Lockheed and Northrop can’t exist without the Air Force. Walmart and McDonald’s can’t exist without food stamps. Entrepreneurs find it harder to start without individual access to healthcare.

Yet Republicans are opposed to the existence of all of these. Perhaps business in America relies on more subsidies and government services than Republicans are willing to admit!

Let’s price externalities, America

Hello, America. We have to talk. You are built on top of a mountain of federal (a trillion or so dollars) debt. That debt covers some things we need (roads, health care, social safety nets, education, scientific research) and subsidizes distasteful things (energy companies, military contractors, banks, real estate). You could consider that debt the tip of the iceberg. We can see how it contributes to the annual federal budget in dollars and by percentages. It’s a measurable, knowable thing.

Unfortunately, there’s also a ton of unmeasured debt we are accruing. We have to pay the price for it through social norms and charity. Here’s a hackish list:

  • food service is systematically underpaid so we tip them, most often poorly
  • the people who clean our hotel rooms are underpaid because they are invisible, unskilled, and often immigrant; depending on what you read, you should tip them but they also say you should hide your valuables from them so which is it, leave money laying around or distrust them not to rub your toothbrush in the toilet?
  • we pay a small tax on the amount of gasoline we use, but it is comically low, hasn’t gone up in years, and isn’t enough to pay for the usage of our crumbling roads, bridges, etc. sometimes it’s also used to pay for public transit, which is perverse during high gasoline prices if you’ve studied even rudimentary supply-and-demand
  • our children are raised mostly by women who are expected to just do it for free, despite what else they may want to do with their lives
  • we let financiers play with our retirement money, in theory because they know how to allocate it, get the occasional Google but more often some business tragicomedy, and in return they get to take a few percent off the top, which ends up being a huge number, for the service basically of them having gone to Harvard or their daddy knew a guy
  • millions of people live paycheck to paycheck, go hungry, go into massive debt if life comes at them wrong, etc. all because the Walmarts of the world (and there are way more than just Walmart) pay them next to nothing expecting the federal government to pick up the slack except the federal government has been systematically dismantled over the course of decades by men who fancy themselves smart enough to start The Next Walmart but in fact are barely smart enough to get themselves elected in a fair contest let alone actually lead a congressional district

But I digress and rant. And rant. Economists call these externalities. It’s when you have some accidental cost or benefit that is paid for by a third party, e.g. Walmart paying less than a living wage because the government will pick up the tab through welfare.

Point is, we’re underpaying for a lot of stuff. And that’s fun for some of us. We eat avocado toast, take exciting trips around the world, maybe drive race cars. We sort ourselves out so we don’t see the literally millions of people suffering because we’re not paying what it takes to give everyone a chance at doing better off than their parents or picking themselves up when life knocks them down. And then when some transparently awful populist blowhard runs for president, we’re shocked, just shocked, that he ends up winning.

Bring the higher taxes. Make me pay more to eat out. Charge me more for gas. I don’t mind thinking twice about whether I should subscribe to HBO and Showtime and Netflix. If I can’t go to Disney World as often, so be it.

It’s a small price to pay to have avoided what’s coming over the next four years: an increasingly unequal, unfair world for those of us who aren’t already doing great and white and male. Let me pay more for a greater country where everyone, not just the affluent, seek what it is that makes them happy in life without the fear of illness, bad circumstance, political or racial backlash. Let’s not lord that greater country over people to “motivate them to work harder and escape their current lot in life”. Let’s price the externalities that separate the concerns of the rich from the stresses of the poor and let’s all pay our share.

They’re okay political opinions

The downside to the Republicans proposing a healthcare bill is that it’s a major legislative disappointment, given they’ve spent seven years symbolically opposing healthcare. The upside is that, at least, we have something substantive to discuss about healthcare. The silver lining is possibly voters will come to see the Republican party for its cynicism.

What is there to talk about? We could start with David Brooks on how we got to the point wherein the GOP has received their moment in the sun. He argues that neglecting three ideas led us to the propaganda of the Trump era:

First, the crisis of opportunity. People with fewer skills were seeing their wages stagnate, the labor markets evaporate. Second, the crisis of solidarity. The social fabric, especially for those without a college degree, was disintegrating — marriage rates plummeting, opiate abuse rates rising. Third, the crisis of authority. Distrust in major institutions crossed some sort of threshold. People had so lost trust in government, the media, the leadership class in general, that they were willing to abandon truth and decorum and embrace authoritarian thuggery to blow it all up.

Brooks argued Obama should have addressed these crises, which the ACA arguably did for the second. IMO, Republicans stoked all three of these fires while pointing their fingers elsewhere. Supply side economics built the first crisis, privatization the second, and propaganda media the third.

Meanwhile in Congress, Paul Ryan is rolling up his sleeves and saying taking healthcare away from Americans is about giving them freedom. Paul Ryan’s Misguided Sense of Freedom:

…But Mr. Ryan is sure they will come up with something because they know, as he said in a recent tweet, “Freedom is the ability to buy what you want to fit what you need.”

He went on to argue that Obamacare abridges this freedom by telling you what to buy. But his first thought offers a meaningful and powerful definition of freedom. Conservatives are typically proponents of negative liberty: the freedom from constraints and impediments. Mr. Ryan formulated a positive liberty: freedom derived from having what it takes to fulfill one’s needs and therefore to direct one’s own life.

(Positive and negative freedom, as terminology, always confuse me; this bit is well written!) This op-ed makes a nice point: healthcare as envisioned by Obamacare, and other more progressive schemes, imagine an America where we are free from worrying about health care. Preventative care happens because we needn’t worry whether we should spend the money elsewhere or take the day off. Major health care events like pregancy or major illness are only intimidating because they are life events, not life-changing unfunded expenditures.

I cannot understand why, outside of deep cynicism of the American dream, Republicans in Congress would not want this kind of free world.

Perhaps there’s a benign explanation for Paul Ryan appearing to have cut off his phones. Anecdotally, it does not seem GOP Congresscritters are putting much effort into their voicemails or phone lines. I called my representative, Lamar Smith, yesterday afternoon, incensed that he had suggested we listen to Trump and not the media. Both his DC and Austin voicemails were full. I was able to get through this morning and spoke with a staffer who was dismissive but polite.

This practice of neglecting voicemails and only dismissively answering phones during office hours is appalling. The job of our Congress is to represent us. They cannot do that job if they aren’t taking every voicemail, phone, and email into account. Very rarely do I get the feeling Congress wants to even appear they are doing their job.

If I didn’t answer my work email, I’d lose my job. But Congresspeople don’t lose their jobs except for during an election or certain kinds of partisan maneuverings.

Fire Congress anyway. I’ve started with the phones and a whole lot of pent-up frustration. Maybe the infernal hell of fax machines is next?