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Squaring the Health Care Circle with Fairy Dust

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What do Americans really want from health-care reform? Unlimited care, from the doctor of their choice, with no wait, and, well yes, free of charge, writes Michael D. Tanner, senior fellow at the Cato Institute.

For Republicans, trying to square this circle has led to panic, paralysis, and half-baked policy proposals such as the Obamacare-replacement bill that passed the House last month. For Democrats, it has led from simple disasters such as Obamacare itself to a position somewhere between fantasy and delusion.

The latest effort to fix health care with fairy dust comes from California, whose Senate voted last week to establish a statewide single-payer system. As ambitious as the California legislation is, encompassing everything from routine checkups to dental and nursing-home care, its authors haven’t yet figured out how it will be paid for. The plan includes no copays, premiums, or deductibles. Perhaps that’s because the legislature’s own estimates suggest it would cost at least $400 billion, more than the state’s entire present-day budget. In fairness, legislators hope to recoup about half that amount from the federal government and the elimination of existing state and local health programs. But even so, the plan would necessitate a $200 billion tax hike. One suggestion being bandied about is a 15 percent state payroll tax. Ouch.

If the U.S. were to adopt a single-payer system nationally, it would crush the American economy, continues Mr. Tanner. It would lower wages, destroy jobs, and throw millions into poverty.

The Tax Foundation, for instance, estimated that (Bernie) Sanders’s plan would have reduced the U.S. GDP by 9.5 percent and after-tax income for all Americans by an average of 12.8 percent in the long run. That is, simply put, not going to happen. So Americans are likely to end up with a lot less health care and than they have been promised.

Americans cannot have unlimited care, from the doctor of their choice, with no wait, for free. The politician that tells them as much will not be popular. But he or she may save them from something that will much more likely resemble a nightmare than a utopian dream.

Read more on the hard realities of health-care reform from Michael Tanner here.

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Debbie Young

Debbie, editor-in-chief of Richardcyoung.com, has been associate editor of Dick Young’s investment strategy reports for over three decades. When not in Key West, Debbie spends her free time researching and writing in and about Paris and Burgundy, France, cooking on her AGA Cooker, and practicing yoga.