Friday, June 26, 2009

In the Big Scheme, is $1.6 Trillion For Health Care Really So Scary? Not if we Adjust Our Priorities

090626-TWIToons-20.ss_full Over at the Washington Post, Ezra Klein says that paying for health care is “A Question of Priorities”:

As we speak, the Senate is toiling to cut the health care reform bill from $1.6 trillion to $1 trillion over 10 years. Health economist Uwe Reinhardt puts those numbers into context:

A price tag of $1.6 trillion seems immense if one contemplates the figure in the abstract. It is, however, only about 4 percent of the total cumulative health spending of $40 trillion, the amount government actuaries now project for the decade from 2010 to 2020. That is also less than the 6 to 7 percent that total national health spending has increased each year in the past decade.

And $1.6 trillion is only about 1 percent of the amount of G.D.P. that America can reasonably be expected to produce in the next decade (about $150 trillion to $170 trillion).

Klein continues:

This isn't a question between borrowing $1 trillion or $1.6 trillion. It's a question of spending priorities. The president, for instance, has proposed limiting the itemized deduction rate to 28 percent for taxpayers making more than $250,000 (the rate for most of us is between 10 and 15 percent). This would raise more than $300 billion over 10 years.

But the Senate has been unimpressed by the proposal. A world, however, in which we cut coverage to bring costs under $1 trillion but leave the itemized deduction, is a world in which we have explicitly decided that we would prefer to spend that $300 billion helping wealthy Americans lower their tax bills rather than helping low-income Americans afford health insurance.

Bob Cesca also wonders:

Nevertheless, Max Baucus has decided to arbitrarily limit the price tag for the healthcare reform bill to $1 trillion over ten years. I can't recall who wrote this recently, so forgive the lack of attribution: In 2002, did any member of Congress randomly set a spending limit for the invasion and occupation of Iraq?

I think this is a point that needs to be amplified.  We have the money.  It’s there.  We just need to adjust our priorities and do the right thing.

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