Bruce Bartlett on HCR

Former Reagan budget official and current Republican apostate Bruce Bartlett has some interesting thoughts on health care reform on Capital Gains and Losses.

I think with time Republicans will recognize that HCR changes our health care system far less than they said it would and in ways that they will eventually acknowledge as improvements. Indeed, within hours of passage some Republicans were changing their tune from complete repeal as the first order of business should they regain control of Congress—which was stupid anyway since Obama would veto any such effort and Democrats in the Senate would filibuster it—to reform; fixing the legislation rather than repealing it in toto.

One reason for the Republican change of heart is that HCR is in many ways a Republican bill virtually identical to the health legislation enacted in Massachusetts under Republican Gov. Mitt Romney in 2006. And if one goes back and reads conservative think tank proposals for health care reform since the 1990s, it's clear that Obama's plan owes more to them than to liberal ideas, which mostly involve moving toward a Canadian-style single-payer system.

Here's the basic logic. If you want to cover preexisting conditions, which just about every Republican does, you have to have a mandate for people to buy health insurance, otherwise no one will buy it until they get sick, which would bankrupt every health insurance company overnight. Once you accept the principle of a mandate, which conservative health reformers have long done, then you have to confront the fact that some people won't be able to afford it, so you have to have subsidies. And subsidies have to be paid for by raising revenue in some way. This leads us basically to where HCR ended up.

Bartlett's main conservative complaint is with the way the bill is financed. He suggests eliminating the government subsidy for employer-based health insurance as John McCain did in the '08 campaign. Others ranging from Fareed Zakaria of Newsweek to Charles Krauthammer of The Washington Post to former Bush 43 advisor Greg Mankiw in The New York Times suggest a consumption-based Value Added Tax (VAT).

--Ballard Burgher