Daily Archives: October 1, 2009

EJ Dionne asks a good question: why don’t centrists approve of the public option?

It doesn’t involve a government takeover of the health-care system. The idea is that only consumers who want to enroll in a government-run health plan would do so. Anyone who preferred private insurance could get it.

The public option also uses government exactly as advocates of market economics say it should be deployed: not as a controlling entity but as a nudge toward greater competition. Fans of the market rightly oppose monopolies. But in many places, a small number of insurance companies — sometimes only one — dominates the market. The public option is a monopoly-buster.

Centrists tell us they want to hold down spending and fight deficits. Strong versions of the public option, as the Congressional Budget Office showed in its scoring of Sen. Jay Rockefeller’s proposal, cut the costs of insuring everyone.

My view on the public option has always been that I’ll know whether I like the idea when I see it explained. The problem is that the idea has been pitched as all things to all men. Centrist voters are told it won’t make much difference. Progressive voters are told it will make so much difference that the entire project is a waste of time without it.

Dionne does that very thing in recounting the public option’s virtues. The public option cannot be both an ordinary competitor, leaving your circumstances unchanged if you choose not to take it up, and a force that can balance the budget by squeezing hundreds of billions out of public health-care costs. It can be one of these or the other but not both.

Democrats have been debating whether a “strong” public option should pay Medicare reimbursement rates, something an ordinary competitor could not do. If it did, this would drive down costs and have many other (not necessarily intended) consequences. It would be a big step towards Medicare for all.  As I have argued before, there are worse things than Medicare for all, including in my view the present system. But this outcome is one of the things that the administration is saying it does not want. If you want Medicare for all, do what some Democrats do and make the case. If you don’t, stop proposing a public option that would push the system towards it.

Politically, the problem with the public option is that it has added to the uncertainty, and hence the anxiety, that surrounds this reform. People want to know where all this is heading. The public option might be nothing, or it might be everything, depending on how it is done. But when advocates like Dionne say that it can be both everything and nothing at the same time, according to your preferences, then centrist voters are right to say, “No thanks.”

Clive Crook’s blog

This blog is no longer updated but it remains open as an archive.

I have been the FT's Washington columnist since April 2007. I moved from Britain to the US in 2005 to write for the Atlantic Monthly and the National Journal after 20 years working at the Economist, most recently as deputy editor. I write mainly about the intersection of politics and economics.

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