In Both Parties, Magical Thinking Prevails

  • Share












By Steve Chapman

In Washington, there are divisions between liberal precepts and conservative doctrine, Trumpism and never-Trumpism, radicalism and moderation. But one type of thinking has come to dominate and unify policymaking: magical thinking.

Democrats are increasingly gripped by this infatuation, which manifests itself in the growing support for “Medicare for All.” Bernie Sanders’ signature proposal has won the endorsement of several others running for president. They want to proclaim health care the right of every person and establish a single-payer system that will ensure no one goes without needed treatment.

But the best of impulses can be wildly impractical, and Medicare for All promises to confirm as much. Both liberal and conservative economic analyses put the cost in the neighborhood of $30 trillion over a decade, and the left-leaning Tax Policy Center found that Sanders’ plan would bring in only about half the revenue needed to pay for it. If it came about, we could add an extra $16 trillion to the federal debt, which now stands at $22 trillion and is already rising.

It is already rising partly because the Republican Party was enchanted by its own type of magical thinking in 2017, when the Donald Trump signed a GOP tax cut that was projected over the first 10 years to reduce revenue by $1.3 trillion and increase interest costs by $600 billion. Net loss: $1.9 trillion.

Supporters promised the plan would pay for itself by supercharging economic growth. But last year, despite solid growth in real GDP, tax receipts fell by 2.7 percent in inflation-adjusted dollars.

Even the $1.9 trillion figure grossly understates the likely cost because it assumes that most of the individual income tax cuts will expire in 2025, something no Republican would countenance.

Sanders and his allies imagine that by eliminating the high administrative costs of private health insurance, they would unleash great efficiencies. But government programs are not exactly famous for achieving great efficiencies. And one reason Medicare is able to get away with low reimbursements to doctors and hospitals is that the providers charge so much more to patients with private coverage. If that option disappears, and Medicare doesn't raise its reimbursements, some hospitals will close and some doctors will leave the profession or curtail their patient load.

Medicare for All would have a couple of other unwanted consequences. "An expansion of insurance coverage under a single-payer system would increase the demand for care and put pressure on the available supply of care," says a new report from the Congressional Budget Office. That's because people who haven't been able to afford doctor visits and procedures will start getting them.

"If the number of providers was not sufficient to meet demand, patients might face increased wait times and reduced access to care," notes the CBO. But the plan would not boost the supply of doctors or hospitals — just the opposite. Even under the status quo, the Association of American Medical Colleges projects a shortage of between 46,900 and 121,900 physicians by 2032. Under a single-payer system, wait times for treatment would grow, and some patients might not be able to find primary care physicians.

Republicans have long used supply-side economic theory to justify tax cuts in good times and bad, which is a distortion of the useful insights of that school of thought. Democrats have now found their own intellectual rationale for disregarding deficits. Known as Modern Monetary Theory, it suggests that accumulating debt at an even faster pace would be nothing to worry about. As with Republicans, whatever value there is in the theory will soon be debased by politicians to justify whatever they want.

It's a bad thing when each party advances very different policies that offload costs to future taxpayers. It's a worse thing when they find common ground, as they threaten to do when it comes to infrastructure spending. Reported The Wall Street Journal last month, "Democratic congressional leaders said President Trump agreed to aim for a $2 trillion infrastructure package in a White House meeting on Tuesday, though the two sides didn't discuss how it would be paid for."

No need to discuss how it would be paid for. Because it won't be.

8 thoughts on “In Both Parties, Magical Thinking Prevails”

  1. Today we see a living example of what socialism is all about in Valenzuela. And we still have the anti-American elected promoting it as people that think they can do it better. The question for these repulsive egotist is are you stupid or do you want to be stupid?

  2. Title: Medicare For All is Health Care for None

    Why do I say that at this pre 2020 election process?
    First, this must happen:
    Democrats will allow as many illegal immigrants as they can muster to vote for them. By 2020 that may be in the 10s of millions.
    Next they must circumvent the constitution and stop and close out the Electoral College.
    Then Socialism will begin the process of destroying America as we now know it. Bold statements? Yes. Anyone that reads this knows I am a firm believer in the Constitution, Bill of Rights and the Rule of Law. We all know what socialism will do to our Democratic Republic.
    I am going to outline just one aspect of the socialist plan for us.

    Medicare for all has more than a formidable cost associated with it. There will be a human cost as well.

    Hospitals:
    I would estimate under this plan that in between 5 to 10 years 60% of all hospitals in the US will close for lack of adequate funding. Who then will get the necessary health care from the remaining hospitals? Those that we call the “elites”. Members of congress, Hollywood actors etc. You know who they are. It will not be us in the mid to lower echelon of society.
    That means elderly patients with chronic illnesses will not be treated and unfortunately will be left to succumb to their illnesses. Look for infant mortality to increase. By infants I mean new born up to preschoolers. Anyone else that needs hospitalization will wait in long queues much to their peril. There will be a continued drop in skilled medical doctors and personnel as well as needed resources that will cause the predicted results.

    Where did the Doctor’s office go?
    Our private insurance or good old cash keep these alive and well.
    They will disappear and be replaced with government funded and controlling clinics.
    One can expect that overworked doctors and skilled medical teams will leave, retire or do something less stressful. Minimal funding will soon cause multiple closings of these clinics.
    So, who gets the needed health care? Eventually no one. Perhaps too strong a statement. But not many. People in need of a primary physician will find them unavailable at best.

    Where are the Doctors and skilled medical people?
    Ever hear of mental and or physical overload? It’s when we are trying to process so much in our work place or daily lives and more events coming along behind this that our mental stress can no longer handle the mental load. This will happen to the majority of medical staff such that they will be forced to leave medical practice to preserve their mental and physical well-being. A simple way to put it. Patient loads with government mandated pay scales and work hours will help physicians and skilled medical workers to abandon their life long ambitions. This will affect the level of medical care for those that need it the most.
    Will our medical school, and teaching hospitals fill the void? Not much as student enrollment will fall off as young students see what is happening in this “Medicare for all” environment (if you are to believe the above) Necessary student loans will become scarce or out of reach for most aspiring students.

    What about our Research and Development?
    America is at the forefront of the research and development of medical devices, medical procedures and practices plus the many lifesaving drugs . In fact, most countries of the world depend on the results and methods from our research. This will also come under Government control and funding. We have in place now the necessary controls for safe and effective results from our research. Under Medicare for All this funding will dry up for lack of necessary funds and our research will slow down or stop altogether. Abandoned will be all the great strides made in cancer, alzheimers, heart, lung, and kidney diseases and many others. Are we ready for the status quo in these important developments?

    End Game:
    I hope, and this document is intended to get those who believe socialism is the answer to all things, to think about the details of such a move would mean to your health care. In the end it will mean “Health Care for None”.

  3. The fact is, Mr. Trump’s economic policiesr are working. The problem is that he had had to dig us out of the hole dug by every President since Reagan, whose economic theory dramatically proved its effectiveness, just as it is doping today.

    The thinking is not “magical,” it is rooted in return on long-term investment, and here in its initial stages it is working.

    What we need is to defeat the pro-death, anti-morality, anti-family agenda and get back to having real families and having children, because our nation’s bedrock is fragmenting, to the Left’s great satisfaction. When we restore the family, we restore the tax-base.

  4. The federal income/payroll tax system supports and enables socialism and undermines and disables capitalism. Capitalism is about building wealth and a higher standard of living with win-win commerce and free markets. Socialism is about redistributing wealth with win-lose actions under government control. Which do you choose, freedom or tax tyranny? A strong economy, larger tax base and higher standard of living or a path to poverty? The solution is to unleash capitalism with the FAIRtax HR 25. Learn more at bigsolution.org and support the cause for real/true federal tax reform.

  5. Voters elect public servants to solve this country’s national problems. Unfortunately, those elected find themselves on a powerless job to solve those problems. Government institutions are no longer controlled by the will of the electorate, but by the closed political system designed to make politicians wealthy IF they follow their party’s leaders regardless of their constituents needs. This DC infighting is the ‘News’ we read about daily. Disgusting!

  6. The only way to get a handle on the budget deficit and the ever growing national debt is
    to grow the economy and to control spending. The Democrat answers are wrong on both
    accounts. Their infatuation with Socialism and their suspicion of business and thus the
    issuance of economy strangling regulations is about as counterproductive as a an approach
    can be in managing the economy. I am surprised to see that according to this story that they
    claim tax revenues are down in the Trump economy. I’d like to see the numbers, but in any
    event his tax reduction strategy has greatly improved America’s competitiveness in the world
    and is a leading cause for all the resulting economic records being achieved by his administration.

Leave a Reply

Your email address will not be published. Required fields are marked *