Cohn Misrepresents the Effects of (and His Opposition to) a Standard Health Insurance Deduction

In a recent article for The New Republic, Jonathan Cohn uses old estimates about different proposal to mislead readers about the effects of a standard health insurance deduction:

A year ago, after Bush first floated an embryonic version of his proposal, economist Jason Furman wrote in the National Tax Journal that “Empirical estimates show that eliminating the tax incentive for employer-provided insurance, without creating another pooling arrangement, could increase the number of people without insurance–even in a relatively limited proposal like that of President Bush.”

The standard health insurance deduction is a pretty serious departure from the proposals that Furman criticized.  And there are more recent estimates of a standard deduction’s likely effect on the uninsured.  Cohn cites but one, which he qualifies:

Even the U.S. Department of the Treasury, which is part of the administration, strained to put an attractive gloss on this idea when Bush trotted it officially out this year. Its own evaluation, under favorable assumptions, suggested the proposal would reduce the number of uninsured by 3 to 5 million–meaning around 40 million people still wouldn’t have coverage.

Unfortunately, Cohn does not cite the Congressional Budget Office’s estimate that the standard deduction would reduce the number of uninsured by nearly seven million. 

It is fair for Cohn to question whether the Bush administration’s projections were just self-serving exaggerations.  But now that Peter Orszag’s CBO has torpedoed that suggestion – actually, the CBO issued its estimate a day before TNR posted Cohn’s article – why hasn’t TNR taken notice of Cohn’s misleading claim?

Cohn also misrepresents his opposition to a standard deduction.  He suggests that he opposes it because it wouldn’t cover all of the uninsured.  But if that were his reason, he also would have to oppose the House bill to reauthorize the State Children’s Health Insurance Program, which would cover only 5 million of the 9 million children that (Democrats claim) lack health insurance.  I think his real objection lies elsewhere. 

If Cohn wants to retain private health insurance at all, it is because he wants to take from some Americans to give to others, and laundering those subsidies through “insurance” markets helps to obscure such redistribution, as does letting employers control workers’ health care dollars.  A standard deduction would let workers control their health care dollars by eliminating the tax penalty that currently makes individual ownership impossible.  It would give workers the agility to avoid – and an incentive to block – politicians’ efforts to redistribute that portion of their income. 

Cohn opposes a standard deduction precisely because it would frustrate his desire to separate the American worker from her money.

A Tragic Legacy

Bestselling author Glenn Greenwald spoke here at Cato on Tuesday on his latest book, A Tragic Legacy: How a Good vs.  Evil Mentality Destroyed the Bush Presidency.  There was a sharp, but civil, exchange with guest commentator, Lee Casey, who has published many articles in defense of Bush administration policies.  C-SPAN was here to tape the event and it will be airing soon.  Of course, all Cato events are archived on the website, so you can watch or listen to this event at your convenience.  For a sneak preview, check out today’s podcast interview with Greenwald.

Greenwald’s blog posts can be found over at Salon.  For related Cato work on the legacy of the Bush administration, read this and this.

A Challenge to Jesse Larner

Over at Huffington Post, Jesse Larner has a lengthy piece on Michael Moore’s film SiCKO and the right-wing reaction to it. Larner calls SiCKO “a clumsy piece of propaganda” and thoughtfully explains how Moore is dead wrong when it comes to the health care systems (and the overall economies) of France and Cuba. Larner concludes that SiCKO is so irresponsible that Moore ultimately injures his own cause.

Unfortunately, Larner stumbles quite a bit. He claims that people don’t die on waiting lists in Canada’s health care system. Canada’s Supreme Court disagrees. He claims that America’s relatively high infant mortality rates make our system obviously worse than other nations. That claim is dubious, since we tend to try to save premature infants that other nations don’t. He makes the same claim about our mediocre life expectancy statistics; but once one controls for fatal injuries and homicides, our life expectancy stats come out better than all other advanced nations’. (If life expectancy really is a “measur[e] of international health care quality,” then does that mean our health care system is the best? I’m not sure, but Larner must think so.) He repeats persistent myths about administrative costs in Canada and America. And he speaks of the bureaucratization and rationing in Canadian and British versions of socialized medicine as if these were unfortunate choices rather than inevitabilities.

Larner also misrepresents the perspectives of Cato scholars. Setting aside whether libertarians are part of the right wing, here are the two places where Larner mentions Cato health policy scholars:

  1. “[T]he trends that emerge show that the American free enterprise system of health care is doing worse than the folks at the Cato Institute would like you to believe, and that socialized medicine systems are doing better.”
  2. “The free enterprise people at Cato and the Heritage Foundation are always moaning about the enormous cost of preventive medicine.”

I am somewhat familiar with Cato’s health policy work, and those depictions do not ring true. I challenge Larner to show where a Cato scholar either (1) describes America’s as a “free enterprise system of health care,” or (2) “moan[s] about the enormous cost of preventive medicine.” I could be wrong, but I suspect he will have difficulty substantiating either claim.

Finally, Larner writes, “these issues [that Moore raises] are important and deserve a better hearing than either Moore or the reactionary right is willing to give them.” Cato has been giving those issues a good hearing. See here and here. (Another reason not to lump libertarians in with the right-wingers.)

Recessed Enlightenment

With Congress adjourned for its August recess, Americans can enjoy a brief respite from the steady stream of bad legislation that typically emanates from the Capitol.

But wouldn’t it be nice if Congress stayed out of Washington for a bit longer?

Senator Joe Biden (D-Del.) recalled a conversation with former Senator Jim Eastland (D-Miss.) about the way Congress used to deal with the summer heat:

“‘Before we had air conditioning,’ he said, ‘that sun would beat down on that dome, heat up that place,’ he said. ‘It would get too hot and we’d leave Washington, and we’d leave for the year,’” Biden quoted Eastland as saying.

“‘Then we got air conditioning, stayed year-round and ruined America.’”

No Right to Life?

Open the newspaper, turn on the television, or surf the net, and you’ll find people saying the government can solve our problems and make life better.  This is the happy face of government:

Behind the happy face is an institution that is willing to strip of us of our right to self-defense, and, worse, deprive dying patients of life-saving drugs.   Who do these politicians and bureaucrats think they are?

For more on the right to life, go here, here, and here (pdf).

Health Care: Why Pols Can’t (or Won’t) Identify the Problem

Arnold Kling writes:

The biggest incentive problem in health care is the insulation from costs under comprehensive health insurance.

Yet most politicians’ idea of health care reform involves expanding insulation.  I’ve got a theory to explain why.

“Insulation” is another term for spending Other People’s Money.  Politicians are predisposed not to see spending Other People’s Money as a problem, because spending Other People’s Money is what politicians do for a living.  If politicians thought there were something wrong with it, they would be in a different line of work. 

If, by some epiphany, a politician were to realize that spending Other People’s Money is wrecking our health care sector, he would be loath to point it out.  Doing so would only encourage voters to question whether spending Other People’s Money causes problems everywhere else too.