The Myth that Government Can't do Anything Right

We’ve all heard the condescending retort to the proposal of any government program. The scariest words anyone can hear are, “Hi, I’m here from the government, and I’m here to help. “ Thanks, Reagan. We’ve heard this so often that it’s become kind of a “known” thing. Everyone knows the government screws up everything, right?

Look at social security. It’ll be insolvent by 2017, right? Here’s the problem: this isn’t true. Don’t believe me? Liz Pulliam Weston wrote an article entitled 5 myths about Social Security that addressed, well, 5 myths about Social Security. Reading the article proves that most of what we’ve been told by pundits and talking heads is just wrong. Sadly, I don’t think even they know or understand how it works.

From the article:

Here's how the Social Security Administration projects the timeline:

• In 2017, Social Security will begin paying out more than it takes in. For the first time, it will have to use the interest being paid on the securities it holds in order to meet its obligations.

• In 2027, Social Security would have to start redeeming the securities themselves.

• By 2041, Social Security would have cashed in the last security, and the system would have enough revenue to pay out only 75% of promised benefits. That percentage would drop over time if Congress failed to act.

What’s this about interest paid on the securities held by Social Security? Everyone knows that Congress has been spending the Social Security trust fund for years, right? Oops.

Three-quarters of the money that's collected in Social Security taxes goes right out the door again in the form of benefits to Social Security recipients. The surplus that isn't needed to pay benefits is loaned to the federal government to pay for other programs. In return for this loan, the trust fund gets IOUs in the form of special-issue, interest-paying Treasury bonds. The interest isn't paid in cash, however; the Treasury issues the fund additional bonds for the interest amount. In 2006, the fund was credited with more than $102 billion in interest; the total value of the securities is about $2 trillion.

So far, what we have is a program that might fail in 32 years if Congress doesn’t act in that time to save one of the most important and popular government programs. Why is it so popular? According to The Center on Budget and Policy Priorities, in 1997, the Social Security program lifts more seniors out of poverty than all other programs combined. “Of the 12.9 million elderly people lifted from poverty by the full array of government benefit programs, 11.4 million — nearly 90 percent — are lifted out by Social Security. “

Social Security is not a failure because it might be insolvent in 32 years. It’s a success because it meets the end goal of the program itself - poverty among the elderly has been reduced - from 35% in 1935 to less than 10% today. In fact, those repeatedly saying it’s a failed program often rely on it for themselves and their parents.

When it misses a payment, call it a failure. When it becomes insolvent, call it a failure. When 35% of the elderly are living in poverty again, call it a failure. Until then, what’s the balance of your 401K? Just enough to make sure that combined with social security it will be enough to sustain you? Or do you plan on living on only social security and have no retirement savings of your own? Not so "inefficient" when it's paying your bills, is it??
　

Reform Health Care like it's Nineteen. . . Sixty-Nine?

Let’s face it. The healthcare system in America is a nightmare. Reform efforts are quickly becoming a nightmare, as well. On the left, we have blue dog Democrats selling their mandate down the river (while accepting millions from health industry related special interests) and on the right you’ve got a party so adamant about “breaking” President Obama that they’re going to say no, filibuster, and fear-monger any way they possibly can in order to keep any type of reform from happening, whether it’s good for the country or not.

Sometimes, looking to the past is the best way to move forward. Time Magazine offers archives online back to 1923. I thought it would be interesting to look at a few excerpts throughout the years and see how health care has changed - or stayed the same - as our country has matured.

June 1923: “Medicine: No Mean Goal”

A thorough physical examination for every man, woman and child in the United States once a year on his birthday is the goal set by the National Health Council, which will open a year's campaign on July 4 for health examinations to forestall disease. The Council has the backing of the organized medical profession.

The first of the fear mongers that I found in the archives..

June, 1937: Medicine: Nationalized Doctors?

Roared Dr. Morris Fishbein of Chicago, editor of A.M.A. publications and spokesman for medical orthodoxy: "The tradition of medicine since the earliest times has been one of service—a service dependent for its success in the curing of disease on mutual responsibility between the doctor and his patient. The American Medical Association has established principles which must govern this relationship between doctor and patient. The purpose of these principles is to maintain for the public the highest possible quality of medical service. As long as human beings are themselves not standardized it will not be possible to provide them with a standardized doctor. Every system of medicine and every change in the nature of medical practice which breaks down this relationship tends to lower the quality of medical service. It is characteristic of medicine, therefore, that it is practiced as an art and as a science, without any reference to hours of work or any fixed formula for its administration. These are the characteristics of the profession and the question which we must answer for ourselves and for the people is simply the question as to whether medicine shall remain a profession or become a trade."

September, 1948: Medicine: Ten Year Prescription

Last week, after seven months of study, [Oscar Ross Ewing] presented the President [Truman] with a 186-page report. To nobody's surprise, he recommended compulsory Government health insurance.

The nation's health, Ewing began by saying, is not what it should be (neither doctors nor Republicans were likely to argue that point). Every year, he estimated, 325,000 Americans die for lack of medical and health services: 120,000 from communicable diseases that might have been cured, 115,000 from cancer and heart disease that might have been prevented, 30,000 unnecessary maternal and infant deaths, 60,000 from other causes.

Ewing also outlined his case for compulsory insurance. He is convinced that voluntary plans are not and never will be enough (even though Blue Shield increased its membership 3,500% in eight years and, with Blue Cross, now has 37,500,000 members). Only about half the families in the U.S., Ewing argued, can afford even moderately complete health insurance on a voluntary basis.

August, 1956: Medicine: Paying the Doctor

Medical costs have been rising faster than any other item on the cost-of-living index, according to the Bureau of Labor Statistics. A patient must now pay 25% more for treatment than in 1950, as compared to an 8% rise in the overall price index. At the same time, benefit payments from health-insurance programs are running a fifth higher this year than last, are expected to go well beyond $2.5 billion. All told, reports the Health Insurance Council, some no million Americans are now covered by hospital insurance-6% more than were covered last year, nine times as many as were covered in 1941.

February, 1969: “Medicine: The Plight of the Patient“:

All or virtually all Americans are now medically indigent," says Economist Pollack. "Health insurance for all has become a necessity." Dr. Philip Lee says: "The Federal Government will have to fill in the chinks of the private system. Private insurance does fine during the years when people are employed, but it doesn't do well for the aged or the unemployed. The Government must fill those needs." Before last November's election, Lee's former boss, ex-HEW Secretary Wilbur Cohen, had on his desk a plan to extend Medicare to provide "crisis care" for all Americans. Some suggest extending it to children, to the handicapped, and perhaps to all the indigent (Medicaid having proved to be no more effective than a bread poultice in most states). McNerney is pressing all Blue Cross plans to broaden their coverage. A practical man, he notes that merely shortening the average patient's hospital stay by one day would save well over $1 billion.

May, 1977: A Bitter Pill for U.S. Hospitals

Now, in his first major health legislation, President Carter has decided to intervene on behalf of the impoverished medical consumer. In a program expected to be sent to Congress this week, the Administration is demanding tough restraints on the fastest growing U.S. medical bill, hospital costs, which last year totaled $55.4 billion. What is more, the proposal is only the first step toward Carter's long-range goal: comprehensive national health insurance.

July, 1982: Those Sky-High Health Costs

The runaway cost of health care has played havoc with the federal budget, which has seen outlays for federally financed medical coverage under the Medicare and Medicaid programs rise from $26 billion in 1976 to $56 billion in 1981. In a desperate effort to slash expenditures and trim a projected overall budget deficit of at least $103.9 billion for the fiscal year that begins in October, Congress agreed to slice $15.2 billion off projected spending of $270 billion for the programs over the next three years.

Ultimately, the solution to the nation's health-care woes must come from Washington, which alone has the power to deal with a dilemma that far transcends individual states or health organizations. Congress, however, has been unable to agree on a plan of attack. In 1978, the legislators rejected a cost-containment drive led by former Health Education and Welfare Secretary Joseph Califano. More recently, President Reagan himself campaigned on promises to curb health-care costs by 1982, but his Administration still has not produced a comprehensive program.

Over the long term, there is no prospect of success in the fight against skyrocketing health-care costs unless the Congress and the Administration work together to give the problem the priority it deserves. So far, that has not happened, and the longer the subject is postponed, the worse it seems destined to get. The fact is that as long as the fever of rising costs burns in the business of medical science, the economy can never be totally cured of inflation.

You will all take away something different from this potpourri of U.S. health history. I will stop the article excerpts in 1982, because I thought no point was more fitting to end with than that of Congress and the President working together to give the problem the priority it deserves. Had they listed to the author of the article, John Greenwald, perhaps we’d be having a different type of debate today.