Healthcare Finance and Realpolitik


As a confession, I have watched with morbid fascination the exhaustive, rancorous debate in the US on healthcare reform on both the right and the left. In a legislative coup by the Democrats, a healthcare reform unparalleled since the 1960’s has become American law. I am not particularly fond of this bill, but I think it is the epitome of the internecine politics that have dominated the republic since its founding days. It is perhaps a bitter irony that to achieve anything worthwhile or progressive in a major democracy results in a compromise that is rather distasteful to even the original sponsors of the bill. This sprawling, squalid mess of a bill neither satisfies the more liberal wings of the USA who would prefer a single payer system nor does it satisfy the conservative elements of society that profit greatly from the status quo. The rest of the country is mainly confused by the provisions of the bill, and relies on trusted pundits to exclaim or decry the legislative enactment.

For my part, at risk of horrifying my grandparents, I support with serious hesitation the passage of the bill for a laundry list of reasons. Healthcare has long been a slow moving train wreck in American politics, with overwhelming costs beginning to cause negative ripples throughout the rest of the economy. Simply put, the status quo is far from satisfactory, and that much became abundantly obvious upon leaving the country for some time. I am extraordinarily skeptical of a free market solution to a classic situation, in economic terms, of perfectly inelastic demand, a serious knowledge gap, and an ethical morass. In other terms, a person faced with pain or dysfunction that he does not understand will and must pay any price in order to sustain his life and stop the pain, and society cannot ethically leave him without recourse to achieve this. Markets, which were designed to provision goods and services most efficiently according to their supply and demand are extremely ill-equipped to handle such a scenario. And the US is perhaps demonstrating this failure with aplomb. Consumers, businesses, and politicians are increasingly dissatisfied with a system that continues to consume a greater percentage of real income.

When it comes down to it, Otto von Bismarck was correct, laws really are like sausages, a bloody, exhaustive, and disgusting grindstone that leaves everyone frustrated and in some cases enraged. But some of the vitriol has been impressively melodramatic and paranoid. In this case, I think the law came together somewhat predictably, all things considered. The Republicans ultimately refused to be involved on any level both because of the distasteful compromises, but also because their best chances for increased number of seats lies in demonising the current majority as being hapless and ineffectual in the face of crisis. The Democrats, for their part, composed of an extraordinarily diverse ideological group born of the limited two party system currently in place, was forced to pass a bill that did not please anyone, in part because they realized that they would be made to look helpless if they were unsuccessful with a major portion of their electoral platform and a debate that dragged on for more than a year.

It is my hope, that having now gotten the something of a bill on the table, that it can be further revised and amended to make something that provides something workable in the long run. But it provides a start, offering to those that are poor, sick, unemployed, or otherwise unable what has become a pillar of modern society.