Is the bailout plan being debated anything other than the socializing of risk? We can afford socialism that saves bankers from themselves, but not national health care?
I was told in email these questions should be asked aloud.
September 22nd, 2008 @ 3:38 pm - by NMC · 30 Comments
Filed Under: Herald & Examiner
I understand the second one but not the first. As to #2, I feel sure that an excellent national healthcare program would be vastly cheaper than this and do us a lot more good too.
My take on the first question is that the government will be there to pull your (the financial companies who have screwed the pooch) ass out of the fire but not for anything else, such as profits.
uhhhhhh
Question 1 and 2 are the same question effectively–
The bailout is taking the risk on to the government. The bankers are being “bailed out” of the bad deals they made– and risked (while keeping the benefit of the good ones).
That’s the government taking on the risk capitalism inherently implies. That’s literally socializing risk.
Apparently, we can collectively protect bankers from the risks of their stupidity but we can’t collectively provide health care for people who are ill through no fault of their own.
I’m confused that the questions were confusing.
This would not socialize risk. Insurance socializes risk.
This is worse. It would socialize the losses, but none of the gains.
I used to be a liberal. I’ve come to realize that government, at least in the U.S., exists merely to protect the rich, not to help those poor or ill through no fault of their own. Color me a libertarian.
NMC, the word order in this sentence made me unsure what it was asking. Look closely:
“Is the bailout plan being debated anything other than the socializing risk?”
If that instead meant to be “… socializing the risk,” I get it. But “… the socializing risk” meant I’m not sure what. My eyes don’t auto-correct phrases, so that string of words, as is, confused me.
ok, I should have said “the socializing of risk”
I changed to “of risk”
Researcher:
insurance is a private system for spreading risk. It collectivizes it but not exactly socializes it (yes, I know there are government insurance programs like the FDIC and flood insurance). An insured does have to pay something to enter any of this risk pools, and the price for entry is paying a premium based on estimates of the risk.
This on the other hand is the government saying: “We will nationalize your risk but leave you with the gains and the good assets you don’t want to offload to us at no cost to you.” It’s socializing risk in the same sense that European national medicine socializes medicine.
Yep, Researcher’s right — this ain’t risk being socialized but pure loss.
Oh looky here — dunno who this blogger is, but is sounds like s/he might be right: another 300-down day put some
fearreasonableness into Bush and Paulson.Now we’re talking some sense. (BTW Lotus-how did you do that strike through thing with “fear”-just curious)
Poor George, we the people have him by one and the Wall Street types by the other. heh
Well, rilly:
“Asked whether he thinks President George W. Bush should be taking a more public role in the negotiations over the rescue plan, Mr. Frank said: ‘I frankly don’t think that would help us pass the bill.’”
GG, I do that by putting del and /del (bracketed by the arrow keys) next to what I want to strike through.
These concessions are acknowledgement that the Administration cannot deliver Republican votes in the House and Senate and has to rely on Pelosi, Frank, and Dodd to bail out their bailout plan.
Yup.
testcool!You folks are missing a big point: We are spending several multiples of what anyone thinks universal health coverage would cost to bailout the finance industry.
We can socialize– have every one bear– the cost of the downside of their risk, but not accept socializing– having everyone bear– the cost of health coverage from anyone.
Instead of getting the point, you folks are quibbling about preferring some other way of describing or wording the issue
Ahem, Brother NMC. See comment 1.
Major health reform proposals break down over the details as much as, or more than, over the cost. There are just too many interest groups coming from too many different angles to reach a consensus on any approach.
NMC 17-I read/heard 9 times the cost of healthcare.
Researcher 19-where there is a will (political or otherwise) there’s a way. And if Dems get a majority out of Nov 4, I’m gonna be expecting some of that will.
It is not that simple.
Researcher, I’m not sure if you’ve looked into the Wyden-Bennett proposal, but it might have a chance. There’s a summary on Sen. Wyden’s website.
As an interested party (I’ve spent 35 years in the biomedical industry), my own take on the health care debate is that there are a lot of participants with an acute sense of their own group’s survival and a flawed “mental model” of how other actors actually operate. Thus, they tend to talk past each other to defend turf.
Real leadership is required to gain commitment to an overarching goal such as a comprehensive, sustainable system. And the incentives for those actors need to be restructured so that the outcome of failing to agree is perceived to be worse than the outcome of reaching agreement. Maybe a new president and a new Congress can find the way.
Researcher; In no way do I mean to imply that it’s simple. But hell, this financial crises is one of the more complex situations there is and we’re gonna do something about it because there is a political will. So, why not the healthcare crises?
al-scooter-*Real leadership is required* AMEN!
Thanks for that info, al-S. I’ll have to check out Wyden’s site.
NMC has it right @ 17: Whatever hopes there may have been for a modern, universal health care program are now gone up in smoke. The next president is going to be hogtied to the Wall Street mess. He will be the guy with the wide scoop and big dustbin who follows the elephants on parade and is responsible for the cleanup. Pity … so much good could have been done.
Yeah what NMC & Be Cole said. Please ignore my earlier nonsense as I have overworked my noodle wrangling legalese into shape today.
P.S. I can now post from Google Chrome, so long as I copy my post, submit, back arrow, reload, paste and submit second time. Chrome rocks!!!
I take a chemo drug that costs $21,000.00 a dose. I have health insurance. My health insurance “adjusts” the charge by not paying University Hospital the $21,000.00, but some small amount, something like $1,500.00. It’s amazing that the drug company charges that much, and it’s just as amazing that the health ins. co. can get away with not paying it.
Rogerwilco – your experience is exactly the sort of insanity that makes it difficult to make the budget work at your hospital, your doctors office, or any other health care provider. And you can bet they’ll have to submit the $21,000.00 bill just right within X number of days or they won’t even get the $1,500.00 If they get it wrong, they may have a second chance, or maybe not. If the payer is the government and they improperly bill, or over bill, too often there are sanctions that may be imposed like: fines assessed, being banned from the program, and/or jail time for those deemed responsible. Made me want leave the industry entirely, and I did.
Oh and the $21,000 is only the “retail” price . . . nobody pays the $21,000 except for the rubes. If you didn’t have insurance, you could ask for the preferred price, not $1,500 nor $21,000, but your average person may not know that. It’s all a price-shell game with the suppliers enormous mark ups for drugs and implants, both cardiac and skeletal . . . and the insurers whom never pay retail. The insurers negotiate with the hospitals for what they’ll reimburse for any given procedure (DRG code or ICD-9 code), and the suppliers are lobbying the doctors to prescribe the most expensive drug or implants, either cardiac and skeletal. The hospitals are always running from the most expensive drugs and implants or trying to negotiate the supplier prices lower, or getting a “carve-out” so the insurers are actually carrying the cost of the drugs or implants. The contracts with the insurance companies give prices for each diagnosis, no matter what it takes to treat an individual. The reimbursement is the contracted amount unless there is a carve-out. It’s an economists nightmare of conflicting pressures. Just like a grocery store, hospitals have loss leaders, say gall bladder surgery. It’s rarely complicated, so if the reimbursement is capitated then the hospital should break even on that item. But say you need neurosurgery, that needs carve outs. Unfortunately, sometimes the hospitals and the patients EAT the uncovered costs . . . so even the insured patients can end up filing bankruptcy due to medical costs. We have a broken system, with no mechanic and no parts to fix the jalopy, and the drivers have no incentive to find the mechanic or parts because they are making money and the vehicle continues on down the road. I hope we fix it one day.
A streamed forum for health and science positions for the presidential candidates:
http://sharp.sefora.org/candidate-forum/
Represented by
Jay Khosla, Health Policy Advisor for John McCain
Dora Hughes, MD, MPH, Health Policy Advisor for Barack Obama
NL
I don’t want to rain on the parade. I have been studying health care reform ideas since before Clinton. There are good ideas out there, but no consensus plan.
There is a broad agreement that reform is needed, but it always breaks down in the specifics and the math.
Almost every American believes that he/she is already paying more than his/her fair share so they expect that reform should give them more benefits for less cost. Doctors don’t want the government setting rates or deciding what is covered. Insurers do not want to lose their ability to cherry pick and cover large groups of young healthy people and leave the rest to the government. Employers do not want to pay any more for health insurance or more in taxes. Drug companies do not want the government to set prices or regulate them in any meaningful way. Then there are hospitals, nursing homes, home health agencies, medical equipment suppliers, and many more interested parties. These are all powerful lobbies who not only work Washington but work the grassroots to whip up artificial outrage with misleading descriptions of whatever proposal is under consideration. Harry and Louise did not kill health care reform alone. Every other group also beat up the Clinton plan and the half dozen or so alternatives that were offered. The public is too easily swayed against anything that would raise taxes, raise premiums, manage their care, or restrict full and free choice of providers and treatments. Any realistic plan has to do some of those things.
This thing is not going to get done by having economists compare plans. There has to be a build-up that creates a broad public consensus that forces the interest groups to deal rather than simply oppose. Right now, none of these plans have dared to be honest about how much it costs for the level of care we expect, or presented a realistic plan about how it would be paid for, or been specific about how we can contain costs without restricting access to some care and treatments.
Remember that Obama ripped Hillary for recommending mandated coverage and Hillary ripped Obama for not covering everyone. The result was that doubts were raised about both proposals with no consensus in favor of either. That was nothing compared to when all the interest groups will be engaged and spending millions of dollars.