November 22, 2008 /

Daschle Fear Starts

James Pethokoukis is scared that Daschle means the end of conservatism: The GOP strategist had been joking about the upcoming presidential election and giving his humorous assessments of the candidates. Then he suddenly cut out the schtick and got scary serious. “Let me tell you something, if Democrats take the White House and pass a […]


daschle-cp-5868875 James Pethokoukis is scared that Daschle means the end of conservatism:

The GOP strategist had been joking about the upcoming presidential election and giving his humorous assessments of the candidates. Then he suddenly cut out the schtick and got scary serious. “Let me tell you something, if Democrats take the White House and pass a big-government healthcare plan, that’s it. Game over. Government will dominate the economy like it does in Europe. Conservatives will spend the rest of their lives trying to turn things around and they will fail.”

And it turns out that the fearsome harbinger of free-market doom is the mild-mannered ex-U.S. senator with the little, red glasses, Tom Daschle. He’ll be the guy shepherding President Barack Obama’s healthcare plan through Congress via his probable role as secretary of health and human services. At the core of Daschle’s thinking on the subject is the creation of a “Federal Health Board that would resemble our current Federal Reserve Board” and ensure “harmonization across public programs of health-care protocols, benefits, and transparency.” (Forget secretary of state, Hillary Clinton should shoot for chairman of Fed Health and run one seventh of the U.S. economy.) And the subject of that “harmonization” would be a $100 billion to $150 billion a year plan that would let individuals (and small businesses) buy insurance from private companies or from a government plan.

healthcare Ironically conservatives always pull out the “oh bad Europe” model when discussing the direction of America. That fact is that Europe is doing a lot better than the U.S. right now. But what really strikes me is how conservatives gawk over a $100 to $150 billion a year plan. They sure had no problem dumping that kind of money into a totally useless war. They sure don’t complain when the Pentagon continues to ask for more and more money every year. Yet when it comes to something that can provide a healthy and more productive workforce, they complain? Why do conservatives hate the American economy so much?

Healthcare costs are costing our economy business and jobs. That’s a proven fact. When companies have to fork out millions to insure their employees, that gives them less to pay their employees and cuts into the bottom line. In the manufacturing and service sector, those costs are also passed onto the consumer. Benefit costs actually account for close to 30% of compensation costs. Almost double that in Canada, where there is universal healthcare. And to rub salt into that wound, U.S. companies that move to Canada end up being able to pay their employees more, because they are saving so much money. That means that compensation costs are actually less to the north. Even GM CEO Rick Wagoner admits that healthcare alone adds about $1,500 to the cost of every car.

Another fact that can’t be overlooked is that these high healthcare costs have become an even more dominant issue due to globalization.

By purchasing parts made overseas, US manufacturers avoid high labor costs at home. It also means laying off thousands of workers who produced those parts. One reason behind the high labor costs: The US stands alone among developed nations with its lack of a government-funded health program that reins in costs.

Of the top six auto-producing nations, only the US and China do not provide universal coverage. Since 1950, the US counted on businesses to provide health-insurance coverage to both workers and their families – no burden during post-war boom years.

-usr-local-y-samba_data-repository--1171903252615_Auto2 So we can compare ourselves to China. Is that really a nation we want to be modeled after? Health is not a priority in China, like it is here. And think if the U.S. took away that key similarity. We could then possibly pull away some of China’s dominance in the manufacturing sector. As matter of fact, the U.S., along with other nations could join together in demanding China do something about their lack of healthcare. That would even out the playing field in the global economy.

Universal healthcare can become a cornerstone of the plan to save the American economy. Better than having to throw away billions to bailout different industries, we could give them instant savings of about 15% per year. Combine that with other reform regulation, such as limiting executive pay and bonuses, and you end up with a recipe for a revitalized economy that appeals to foreign companies and ends up bringing in new business and jobs. Of course both of those necessities always meet with strong objection from conservatives. Their ideology prevents them from wanting to do things like limit executive pay and perks, along with the government covering the cost of a healthier American workforce. Instead they prescribe to a notion that the very few, the CEOs, should be able to make millions upon millions while the majority suffer.

This can also be seen if you look at one of the healthcare plans championed by conservatives:

Another interesting healthcare reform option is highlighted by Ross Douthat and Reihan Salam in the book Grand New Party. Uncle Sam would require individuals and families to put 15 percent of their income into health savings accounts. If you run out of money before year-end, the government steps in. If you don’t, you get the money back or it rolls over into a retirement account. Of course, any conservative alternative would be easier to implement if it doesn’t first have to kill an existing nationalized health plan. But thanks to Tom Daschle, that is just what might have to happen.

Savings This plan takes away company liability. Even if an employer was feeling generous, and decided to cover the 15%, they would still be in the same boat with healthcare amounting to the same percentage of compensation as before. The plan also lacks further focus. A lot of families can’t afford that 15%. Countless can’t afford co-pays alone, which has helped lead to our healthcare and financial crisis.

Also they seem to ignore the fact that healthcare costs are the same, regardless of what you make. If a person who makes $20,000 a year needs a bypass, it will cost them the same as someone who makes $250,000 a year. A family earning the median income of $50,000 a year would also end up with $7,500 in their health savings account. That doesn’t leave a lot to cover healthcare expenses. Monthly prescription costs of $500 or more per month are not uncommon. Add to that costs of lab work and doctors visits, and a single person can quickly eat through that $7,500 a year, not to mention a family of four.

We need to stop demonizing systems that work well for other nations, and instead use them as a model to build our own system that works just as well, if not better. Conservatives are quick to use the healthcare systems of Canada or Europe as a punch line. The fact is their healthcare system works. Life expectancy in those countries exceed that of our own, and their workers are more productive from being healthier. That’s not a punch line, that’s economic security.

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