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Q&A Friday #104: Why Is ObamaCare So Bad If Social Security And Medicare Are So Great?
Written By : John Hawkins

Question: “How would you answer Kristof’s “Wrong Side of History” piece in the 11/18 NYT? If Medicare, Social Security and similar past advances of the welfare state didn’t do us in, why should anyone believe this one (healthcare takeover) will be the one that kills our economy? Are we suffering from a “boy who cried socialism” effect from past protestations?” — oldch

Answer:

First off, here’s the close of Kristof’s column. It gives you a rough idea of his argument:

It’s now broadly apparent that those who opposed Social Security in 1935 and Medicare in 1965 were wrong in their fears and tried to obstruct a historical tide. This year, the fate of health care will come down to a handful of members of Congress, including Senators Joe Lieberman, Blanche Lincoln, Ben Nelson and Mary Landrieu. If they flinch and health reform fails, they’ll be letting down their country at a crucial juncture. They’ll be on the wrong side of history.

Since it’s political death for a politician to criticize Social Security or Medicare, Kristof thinks he’s on safe ground making this argument.

However, I’m not a politician, so I can tell you the truth: We have frighteningly large Social Security and Medicare obligations as a nation coming due in the next few decades and we have NO IDEA how we’re going to pay them off. In all likelihood, either a lot of people who paid into the program are going to be ripped off or it’s going to lead to crushing levels of debt we may never have a realistic possibility of paying off. You may say, “Well gee, Social Security and Medicare have worked out pretty well for the people who have been on the program so far!”

That’s true — unless they died before they got their benefits — and if you forget that anyone who lived long enough to collect and had invested the same amount of money would have been much, much better off. Even setting that aside, Ponzi schemes often work out great — until the end, when people get left holding the bag.

PS: Medicare is part of the reason your medical bills are so high now. The government underpays for services and they pass the costs on to you. Still happy with it?

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  • CoolCzech

    Why Is ObamaCare So Bad If Social Security And Medicare Are So Great?

    My GOD, let me take a stab at this:

    1. Social Security is a HORRIBLE investment, giving retirees FAR LESS than if they had, for example, simply invested their money in 100% safe government bonds.

    2. Social Security & Medicare are going bankrupt. The money that will be necessary to pay for everything a couple of decades from now will literally drain our economy dry.

    3. Despite spending so much that it’s draining our economy dry, Medicare underpays doctors & hospitals terribly. In fact, its the explosive growth of non-Medicare medical costs is directly related to service provider’s needs to make up for the underpayments (I’m call it, government theft of services) by passing them along to those of us with private insurance.

    4. Now, the same Democratic Party that told us a few years back that “there is no Social Security crisis” want to solve the pending Medicare crisis by, in effect, putting ALL of us on Medicare.

    But the troubling question is: WHO will ripped-off service providers pass on true costs to, if no private insurers are left? And make no mistake: there’s simply no way the so-called “private option” will not begin to systematically destroy the private insurance industry. After all, both Obama (pre-President) and Barney Frank admit that’s exactly what they want to see happen. IMAGINE: they actually WANT Soviet-style healthcare for Americans!

    So the answer is: Social Security & Medicare can’t suck enough and aren’t sustainable even our wildest dreams. NOW imagine turning 1/6th of America INTO Medicare!

    And we now have a stunning example of how that will work for us:

    - Woman will be deprived of breast cancer screening before age 50. The European-style death rates that will result will ease up financial pressures on Social Security. Can’t collect your check, if you’re D-E-A-D Dead, right?

    - The same “advisory death panel” has also recommended that men not be screened for prostate cancer until much later in life. D-E-A-T-H Death Panel, Folks.

    And here’s the kicker: I know whats_up whines that this board is “only advisory,” but Reid’s bill makes it official, makes it’s findings mandatory, AND immune from appeal.

    So we’ll pay more for much less, and die earlier, all so Democrats can indulge in their Soviet-style central planning fetish, and give away medical services to illegals & deadbeats. Nice.

  • CoolCzech

    Sorry about the bold…

  • Mike_M

    Let me repost some statistics from an earlier thread:

    1. Medicare and Medicaid (state and Federal) cost about $900 billion a year now.

    2. Combined those two programs cover 83 million Americans…the combined populations of California, Texas, New York, and Connecticut.

    3. 60% of the Federal budget is entitlements, a number which is only going to increase as Baby Boomers begin to retire. At our current deficit spending level, every tax dollar paid by Americans *would not cover the entitlement bill*.

    We’re past the breaking point already. The only reason this facade continues to play out is because the rest of the world is lending us money to pay for it. How much longer do you think they’ll continue?

  • CoolCzech

    How much longer do you think they’ll continue?
    Posted by Mike_M
    2009-11-20 16:53:09

    Liberals prefer not to think about things like that, Mike_M.

    Sane people look at California and see a disaster. They look at California, and think how neat it will be once they bankrupt the rest of the country, too.

  • http://networdblog.blogspot.com/ Christopher_Taylor

    Yeah. The fact is Social Security and Medicare are not great. They are unconstitutional overextensions of federal power that have caused more harm than help.

  • D-Vega

    They aren’t great, but they have worked.

    And why only one question from the Q&A?

  • Mike_M

    “They look at California, and think how neat it will be once they bankrupt the rest of the country, too.”

    The rioting has already begun on the UC campus because of 32% tuition hikes. Just wait until the real cuts begin.

  • http://networdblog.blogspot.com/ Christopher_Taylor

    They aren’t great, but they have worked.

    Depends on your metric. They have helped people, but the people might not have needed the help without the higher taxes and government intervention in the market. Social Security was sold as an end of life emergency help during the depression, not a retirement account for 30 more years of life.

    And if you factor in the dependence of people on government, knowing they’re never going to be without it – how much damage has been done? How much better could it have been without these things?

  • wylie_e_coyote

    Here is my Fax to the two “wavering” Senators from the deep red south:

    “I do not live in your state. However, I am concerned citizen who feels deeply that we are on the verge of making a huge mistake if we adopt any of the currently proposed “health reform” legislation. I very much appreciate your candor on this issue and am writing to further elaborate my personal views on this very urgent matter.

    I am strongly opposed to all of the current bills (HR 3292, Wyden-Bennett, et al) in Congress that are being considered by you and advocated for by the President. PLEASE VOTE NO ON CLOTURE FOR OPPENING DEBATE ON SENATOR REID’S BILL! All of the various Federal Government centric approaches currently being “debated” are unaffordable, ill conceived, and hastily thought out schemes that essentially cede control of the most basic right, that of control of our own bodies and lives, to the Federal government while doing little in the way of improving our medical care or the cost of medical care in this country. Systems in which control of medical care has been centralized by the government have been tried unsuccessfully in several other nations to worse outcomes for personal health, civil liberty, and economic wealth being.

    There are several details of these health care nationalization plans that put on us on the path I describe above. Most specifically, a lot of attention has been paid to the “public/government option” (and the related “COOPs”) as the most blatant and obvious from of government control and a mechanism to destroy the private insurance market. But this is in fact just the tip of the iceberg so to speak in terms of the multitude of bad ideas contained in these government centered plans. The key item that I am most concerned but I very rarely hear discussion on are the so-called “Individual” and/or “Employer” Mandates designed to force everyone in this country to buy Health Insurance policies on terms dictated by the Federal Government. This is an extremely bad idea on many economic grounds based on its impact to the economy, job creation, and the large additional demands it would place on the health care system. However, what is truly insidious about these proposed “Mandates” is that they would amount to a “stealth tax” on the young and healthy that in all likelihood would not opt to pay the high premiums or use the “minimum” level of coverage that is currently proposed. Also, contrary to the rhetoric being put out by proponents of these “mandate” schemes, they would have the effect of eliminating any individual choice in the basic decision of how much, if any, health insurance they personally may require to cover any unforeseen medical expenses. Finally, the required regulatory mechanisms, required expansion/hiring of government employees/technocrats, and proposed subsidies that go along with these Mandates expand the government’s role in such a way that it will be in practice a Nationalization of the Heath Care Industry in this country. I strongly urge you to oppose any plan that contains any individual/employer mandate provisions! Please do not compromise on this point!

    Another disconcerting subject that is also rarely discussed in our current “debate” on this issue is how these proposed plans are in actuality a de facto government bailout of yet another large and failing “Big” Industry (the Health Insurance industry has 80 million of 135 million customers who are aged 50-65 i.e. the most costly years for medical care – they have also recently suffered large losses in last year’s market collapse) by giving them millions of new forced customers. It is also essentially a cover up for the failure of politicians of both parties to properly fund promised Medicare coverage for the elderly (these mandates will continue to allow the Federal government to continue to cost shift Medicare shortfalls to the private insurance system). Last but not least, the fact that these arrangements were arranged in close door meetings by industry lobbyists with government officials to the determent of the American citizen smacks of the worst kind of corruption possible. This type of short term and self-serving focus has been the root cause of many of our current difficulties and is the primary reason citizens such as me have lost faith in the ability of our elected officials to represent us in good faith. I urge you to stand up to these powerful interests on behalf of those who elected you to office and expose the reality of this situation.

    The specifics of this plan give control of our health care system up to a bad combination of special interests, corrupt politicians, and unelected technocrats. I urge you to stand on the side of our citizens versus this unholy trinity of interests and do your utmost to delay passage of this bill to allow for further debate and discussion. In my opinion, it is complete insanity to consider passage of this sweeping a proposal with only a month or so of discussion. If nothing else, the American people deserve a reasoned and measured approach to an issue of this magnitude – one in which all the various facts, assumptions, proposed courses of actions, and likely outcomes are analyzed and discussed by experts on this subject in an open and free public hearing.

    Finally, I would also advocate an incremental or “trial and error” approach toward adoption of legislation would be the logical way to proceed. If we implement in a moment of haste a huge and expensive “new” government centered health care system, we run a large risk of never being able to reverse many of the negative impacts that will likely result.

    I urge you to work for the defeat of these plans and refocus your efforts on genuine health care reform that empowers the patient and health care provider, provides tort/medical malpractice reform, a true national health insurance market where insurance companies are actually forced to compete via the semi-monopoly system we have in place, providing the same tax incentives for individuals to purchase coverage as employers, and placement of Medicare/Medicade programs on a sustainable financial basis. The track record of truly free markets where individual citizens are allowed to make their own free choices have a much, much better track record of delivering both quality and lower costs then any centrally planned or managed system. We have ample evidence from countries around the world where these government run systems are in place and where there citizens get worse care, higher per capita costs, and/or rationed care. Please place your faith in the power of the individual citizen to make his or her own best choices in a matter that is so basic to our daily lives.

    Last but certainly not least, I would advocate that you consider the costs to our nation not only in terms of medical outcomes and dollar costs but in terms of individual Freedom and Liberty. Essentially, it is my belief, due to their numerous and obvious flaws, the currently proposed “Health Insurance Reform” plans has little or nothing to do with improving anyone’s health or the reducing the cost of medical care in this nation but rather have a lot to do with politicians benefiting from the resulting dependency to create yet another reliable voting bloc in order to perpetuate their political power. If allowed to become the law of the land, these plans will fundamentally alter the relationship between the individual and the state to the permanent determent of the individual. In short, this is a huge transfer of sovereignty from the people/individual to the state that is not at all in the spirit of or worthy of a democratic nation of free and independent people!

    I thank you for your consideration in this matter and truly hope you take the time to read this letter and reflect on its contents. With all candor, the likely path to ruin we set ourselves on if we adopt any of these proposed schemes haunts me and causes me great concern for the future of this nation. I have three young children whom I love very deeply. I would like them to have the opportunity to grow up in the same America I did and have fought my entire adult life for – a nation that remains economically prosperous, politically and socially vibrant, values all human life as unique individuals worthy of respect and dignity, and where its people remain truly free and sovereign.”

    I am sure they read every word and will listen to me and people who agree with me over 100 million dollar political bribes lol

    But, collectively they may listen if they get a crushing amount of emails, faxes, and calls like this – this is the only recourse we have at this point….keep fighting!

  • http://www.superdickery.com mightysamurai

    The idea that more socialism must be okay because a little socialism hasn’t totally destroyed us yet is absolutely moronic.

    That’s like saying if two nuclear explosions didn’t destroy the world, we should just nuke everyone willy-nilly and everything’ll be just fine.

  • http://networdblog.blogspot.com/ Christopher_Taylor

    That’s just it, Sam. We’ve tried this before, and all it does is cost billions more than predicted, things get no better, and people are made more dependent on the federal government which grows at a grotesque rate. Unconstitutional spending is still unconstitutional no matter how much you happpen to think its a good idea.

    Lets try something different this time, instead of more of the same. Is that so unthinkable?

  • tomw

    Howcome no one is mentioning the ‘lock box’ full of IOU’s??

    The Goracle stated the money was in a lock box, and that was an out and out lie. The SocSec money has been taken by Congress and replaced with low yield bonds. Which will be redeemed real soon now. The original date when redemption [ outgo greater than current inflow] would begin has been moved up two(?) years.
    That means, not only did the #$^T)@@@ in the White House blow the budget out of the water, he has to start paying SocSec back for all the money they’ve taken and spent. Thanks, LBJ. [I think] Good way to hide the deficit, or at least mask part of it.
    There are more obligations in place today than can be paid. Anyone who is counting on SocSec has a rude awakening coming. I won’t qualify for a few more years, but I did not think it would be there when I became of age, and planned accordingly.
    Now, the A**H*l* in chief has taken it upon himself to destroy the value of everything I worked for, everything I had depended upon to pay for living expenses. House value down about 40%, stock down the same, IRA tanking and the jerk is bound and determined to turn the dollar bill into green toilet paper.
    I can’t go get a job, too friken old. He is destroying peoples’ savings and investments.
    I always figured that if the dollar tanked, and you had to depend on gold for ‘value’, it would be all over anyway. Well, I think we’re damned close to that situation.
    I just hope the price of canned cat food doesn’t go too high…

    tom

  • http://www.superdickery.com mightysamurai

    No no, wait, I’ve got an even BETTER analogy.

    This is like saying if all the carbon emissions mankind has produced so far haven’t destroyed the world, a little more can’t possibly hurt.

  • RWNReader2

    They aren’t great, but they have worked.

    Not if you’re about 35 ~ 45. In that case, you’re absolutely FUCKED.

  • rmiller

    Not if you’re about 35 ~ 45. In that case, you’re absolutely FUCKED.
    Posted by RWNReader2
    2009-11-21 20:18:29

    Could be.

    I’m not opposed to ending social security. I know that all administrations, Rep. and Dems. and all members of Congress over the past couple of decades have not respected the trust that is S.S.

    They treated it like free money.

    If there were a bill that would phase it out over time, and treated those who have contributed to it equitably….go for it.

    Make the case. I’m in my mid fifties and have contributed to it all of my working life. That’s money that has paid for my parents and all those retirees older than me. What I object to is that somehow, at this point in time, in this case….the payments have to stop. S.S. has many tens of thousands of my dollars…and to claim that somehow I need to lose that money without recompense is a non starter.

    Conservatives who don’t like S.S. need to bring forth a policy that does not penalize someone like me, and convince the younger workers that there is an alternative.

    I’m not convinced that you are fucked…I know there are tweaks to the system. I, for example, can’t imagine me voluntarily retiring to collect social security. You have to make me retire…

    I don’t blame conservatives for questioning the viability of S.S. in the long run. Anyone with a good sense of math knows that the system as currently configured and used by both political parties is headed for disaster. That includes us liberals. But we haven’t heard an alternative….other than it’s a ponzi scheme.

    Well…yes. How to we get out of it without punishing those who have invested in it?

  • http://networdblog.blogspot.com/ Christopher_Taylor

    Conservatives who don’t like S.S. need to bring forth a policy that does not penalize someone like me, and convince the younger workers that there is an alternative.

    Again? Last time one was offered your side said it was a plan to kill old people.

    How about you offer an explanation why we should keep a bankrupt and illegal, unconstitutional federal program?

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