Public Option Goofiness


Yesterday, I took Ezra Klein to task over some goofy public option logic.  Today, Conor Clarke, subbing for Andrew Sullivan, gets closer to correct, but still manages to miss completely:

[T]he public option is only a means to an end — reducing costs and expanding coverage — and there’s little that is unique about a PO’s ability to do either of these things. If liberals are picking between, say, a strong individual mandate with generous and well-targeted subsidies, and a public option vitiated by the long August recess, there’s absolutely no shame in going with former. Not that anyone’s offering that choice, of course. But there’s no reason to turn a public option into a political fetish.

I agree the public option is only a means to an end.  It’s not even a means I’ve been particularly interested in, as evidenced by the fact that I haven’t written about it here.  But goofy logic is goofy logic, and unless I’m missing something, Clarke’s logic is as goofy as Klein’s.

Clarke acknowledges that the end a public option is aimed at is reducing costs and expanding coverage.  He then lays out two possible policy outcomes: a public option, and a combination of individual mandate and subsidies.  He says one is as good as the other.

Well, no.  Unless I’m missing something, one isn’t as good as the other.  The second option expands coverage, but does nothing to reduce costs.  It might have some second-order effects on cost, as people who were uninsured now get less expensive preventive care rather than ultra-expensive emergency room care, but that’s a big step down from the public option’s effect on cost.

Quite frankly, between runaway costs and the number of uninsured, the bigger problem by far is runaway costs.  It drives up the number of uninsured, the number of underinsured, and the number of families bankrupted by illness even though they do have insurance.  It will bankrupt the federal government in the next 20 years, due to Medicare obligations.   It is one of the leading causes of wage stagnation over the past 20 years.

So, contra Clarke, there is a very big difference between a policy that reduces costs and expands coverage, and a policy that just expands coverage.

I don’t care if the policy that reduces costs is a public option or something else, but we have to have a policy that reduces costs.

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