JONATHAN COHN FEBRUARY 4, 2011
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Read part 1 of this argument here.
The conservative legal brief against the Affordable Care Act rests heavily on a simple proposition. Government can’t make us obtain private insurance because, as the argument goes, that would be forcing us to buy a private product.
Politically and constitutionally, it may be an effective argument. But do the law's harshest critics, the ones screaming about tyranny, actually believe that? In particular, do they think it's even scarier than a single-payer, government-run program, as they argue in their briefs and Judge Roger Vinson suggested in his Monday ruling?
I have my doubts. And while I offered some of my reasons yesterday, I left out a big one: Social Security privatization.
You remember privatization, don’t you? The idea was to take Social Security, a mandatory public pension program, and turn it into a system of mandatory personal investment accounts. The schemes evolved over time, with different details, but the gist was always the same. During your working years, you’d make contributions into the accounts, just like you currently pay taxes that fill the Social Security Trust. Over time, you would invest the money in your private account—that is, you’d buy stocks, bonds, and so on—typically within certain guidelines set by the government. Once you hit retirement, you’d start to withdraw from the accounts or perhaps purchase an annuity, relying on subsequent payments for your financial security.
Conservatives presumably thought privatization was constitutional; otherwise, they would not have worked so feverishly to enact it. But if the principle holds for old-age insurance, it ought to hold for medical insurance, too. In other words, if it’s ok for the government to make you pay for regulated private investments, then it should be ok for the government to make you pay for regulated private health insurance. Yet, as far as I can tell, the folks who spent all of those years promoting Social Security as an all-American, free market innovation are the same ones that now insist the Affordable Care Act is an unprecedented threat to liberty.
What's going on here? The truth, I think, is what I said yesterday: Some of the Affordable Care Act's critics are mere opportunists, while the rest are more extreme libertarians who oppose all mandatory schemes of social insurance. But even the hard-core libertarians understand political reality. Social Security is too sacrosanct to attack, politically and constitutionally, so they will make do with privatizing it. The same goes for Medicare, which they dare not challenge directly. But the Affordable Care Act is vulnerable, so they trying for full repeal, making whatever arguments necessary to achieve that goal.
Strategically, it makes perfect sense. But intellectually and morally, it's inconsistent at best.
15 comments
(1) Consistency is the hobgoblin of small minds. (2) Woe to you, teachers of the law and Pharisees, you hypocrites! You are like whitewashed tombs, which look beautiful on the outside but on the inside are full of dead men's bones and everything unclean. Take your pick.
- rayward
February 4, 2011 at 7:51am
You are not serious are you? There is no requirement in the Social Security Privatization for anyone to buy anything. You are given the CHOICE of what to do with some of your money, not mandated what to do with it. This bears no relationship to the health care mandate. Disingenous? Come on Jonathan, look in the mirror.
- docbowtie
February 4, 2011 at 8:26am
[about buying a private product] Politically and constitutionally, it may be an effective argument. Can you imagine if there was a valid constitutional argument about forcing people to pay private industry money? How about, for starters, needing to hire someone to do your accounting prepare your tax return because it is too difficult. What about all regulation of any sort that imposes a cost on a business? As far as compelling people to do something, the ACA is tame.
- Nusholtz
February 4, 2011 at 8:39am
docbowtie: http://www.cato.org/pubs/ssps/ssp7.html The Cato Institute: "Privatizing Social Security" by Martin Feldstein Privatizing Social Security, transforming it from an unfunded pay-as-you-go system to a system of mandatory private savings accounts, would solve both of those problems and increase economic growth. ... eliminating the payroll tax would reduce the distortions in work effort and form of compensation that currently depress the productivity of the economy and the real standard of living. When the system of funded individual accounts is fully implemented, the mandatory contributions required to fund the current and projected levels of benefits would be only about 3 percent of payroll, far lower than the payroll tax, which is expected to rise from 12.4 percent now to at least 20 percent over the next 35 years.
- Jonathan Cohn
February 4, 2011 at 8:46am
docbowtie - any CHOICE except not to feed my social security to a bunch of government financed crooks on Wall Street, any CHOICE except to keep the most popular government program in US history a guarenteed entitlement exactly as it stands. If there is ever a more dangerously stupid, ideologically driven idea than "privitization" of social security, I have yet to see it (well, except this dishonest attack on the health care mandate). There is no opting out of the health care system, period. You don't want to buy health insurance? Fine - then pay your own bills when you're hit by a bus or your kid gets cancer and stop foisting them off on people who do.
- WandreyCer
February 4, 2011 at 9:49am
Of course, SS has not been an unfunded "pay as you go system" for more than 25 years; it's been an unfunded "pay far more than needed to fund current benefits in order to support large income tax cuts for the wealthy" system, with payroll taxes collected exceeding benefits paid of about $2.6 trillion, the excess going entirely to pay general operating expenses of the government (wars, etc.). I'm not sure which is worse, the hypocrisy pointed out by Cohn (even Dr. Feldstein) or the on-going theft from the social security "trust fund" I point out. Like I said before, take your pick.
- rayward
February 4, 2011 at 10:30am
This is what DrSteveB said on the other thread and it shows how disingenuous Cohn is being: Dear Jon: As I think you know, but do not mention in this essay, there is the honest objection to the individual mandate from the left single payer perspective that makes a clear distinction between the government requiring you to buy a product from a private for profit company (a product with excessively high overhead and inherent defects due to its being a private for profit product) which is the mandate, and using tax revenue to directly provide a public benefit (Medicare, expanded and improved Medicare for All). The mandate uses the police power of the state (in the legal sense; whether semantically a tax, fine or other penalty does not matter) to mandate you to buy from a private for-profit third party. That really is different from a government tax to provide a government service. This is another opportunity to also ask you to address the question as to why philosophically and/or legally this is not analogous to a "taking" under eminent domain. The individual mandate, especially without a strong public option alternative is like the terrible Kelo decision, whereby the Supremes confirmed the use of eminent domain to transfer land from one private owner to another to further general governmental interest in economic development. As with Kelo, honest libertarians and serious liberals/progressives/lefties can agree that the individual mandate is wrong (if alas, legal). And once and for all Cohn, will you at least admit that the Mandate as set up was a terrible idea and if the Surpreme court strikes it down it will be because of your arrogance in not listening to the objections. They could have easily done a tax and rebate plan, which "punishes" no one or forces anyone to purchase from a private sector company by virtue of simply being alive. Stop arguing strawmen issues (who the hell cares what some Conservatives wanted for Social Security) and address this issue strictly as it is. Forcing me to buy from a for profit privately held company to purchase a service I might not even be able to afford, considering the amount of gouging insurance companies are likely to do and get away with. In Mexico I pay a tax and get health care automatically. I dread going back to the states and dealing with insurance companies. Not long ago during my summer vacation I bought insurance short term and my wife went to a clinic for supposedly something covered, since that time I have spent lord knows how much money arguing with both the clinic (who claims they never got the insurance money) and the insurance company (who claim they paid it) with both refusing to talk to each other. I am tempted to just pay the bill out of pocket. And this is what Cohn and his goons wants to force me to pay for?
- blackton
February 4, 2011 at 11:37am
Can we just go ahead and say "intellectually and morally corrupt" rather than weaselling around with "inconsistent"?
- cspencef
February 4, 2011 at 11:43am
Will address SteveB's thoughtful comments later, but, very quickly, please remember that these two posts are about the intellectual consistency of those arguing against the mandate-- not constitutional merits of their briefs before the courts. For conservatives to say, as they have, that ACA is a threat to liberty but Medicare isn't makes no sense whatsoever, because they usually claim (as they do with Social Security) that privatized social insurance is better than government-run social insurance. It's a different story with somebody like SteveB, who is making his case from the left. It's reasonable that somebody with that ideological disposition (which, as you know, I largely share) would find ACA more philosophically troubling than Medicare. That said, I don't happen to agree with SteveB on this. I.e., I'd rather get my insurance through a single-payer system, but I'm willing to do it through regulated private insurance and don't consider it an unreasonable infringement on my liberty.
- Jonathan Cohn
February 4, 2011 at 12:39pm
Cohn: I'd rather get my insurance through a single-payer system, but I'm willing to do it through regulated private insurance and don't consider it an unreasonable infringement on my liberty. But this is not the issue, the issue is whether the Supreme Court will strike down the entire bill because THEY (the majority at least) view it as an unreasonable infringement on peoples liberty. If it does go down, and none of us know right now what might happen, then I don't want to hear about how the Heritage foundation liked it years ago...the Mea culpas must all be on the Democrats. They could have set up the bill so that no Constitutional challenge was even possible.
- blackton
February 4, 2011 at 1:41pm
I dunno, a Social Security system where you get to choose which funds to invest in, where you get to choose whether or not you invest at all, and where there is no payroll tax sounds to me a heck of a lot like the way the world would be if there were no Social Security. If you take out the second part (you don't get to choose whether or not you invest), then it does sound to me an awful lot like an individual mandate to invest in the stock market. One of Hillary Clinton's better lines while defending the individual mandate from (ironically) Barack Obama was, "What if Social Security was voluntary?"
- ulexamp
February 4, 2011 at 3:02pm
Wandrey..... the problem you point out to docbowtie is even more serious than your argument alludes to. If he can't pay for his medical care and ends up taking out bankruptcy, again, we all pay for that through higher prices and more guv'mint assistance. Likewise with disability, we all pay through government support programs. The ultimate irony to me is that conservatives know damn well that medical treatment won't be denied to anyone because of the Hippocratic Oath. The question merely comes to who pays and how they pay. All care gets paid for, but the costs get shifted and hidden to the general public. Just like environmental and other costs associated with fossil fuel use.
- desertdog
February 4, 2011 at 3:43pm
There's one aspect to the individual mandate that gives me pause - and that is the cost. If it's reasonable, that's one thing. If it puts you out of your apartment - that's something else. Where are the guarantees that mandating this purchase won't put people of limited means out on the street?
- Sophia
February 4, 2011 at 4:23pm
Sophia: The law included subsidies for those in poverty, including an expansion in Medicaid. It also includes limits on how much variation you can have in price. (So in other words, if you have a pre-existing condition and you have to get coverage, the insurance companies can't charge you a fortune.) I also think, at least in theory, the authors of the law are hoping that with all this new demand for low-cost insurance, companies will figure out ways to meet it with more efficient low-cost coverage. I'm not an expert on that, though--it seems just as likely that insurance companies will realize they have a captive market and just let the money pour in.
- ulexamp
February 4, 2011 at 4:35pm
ulexamp, thank you; will have to look and see if they have published rate tables?
- Sophia
February 4, 2011 at 10:30pm