One Man's Ceiling Is Another Man's Floor
By the way, I do have one modest proposal for debt ceiling reform.
We’re all agreed that the big driver of future deficits is the growth in Medicare, which in turn is driven primarily by the growth in the cost of medical services (secondarily by demographic factors).
Both parties agree with this, but there is stark disagreement about how to restrain the growth of Medicare: whether by greater government control of the medical system or by less (or by a combination thereof – Obamacare plus the voucherization of Medicare would be such a combination).
We’re also all agreed (everyone who’s actually paying attention, anyway), that the debt ceiling serves no rational purpose. Congress approves both taxes and spending; if Congress refuses to approve borrowing the difference, then Congress isn’t making a policy statement – it’s simply refusing to do its job. Even if the purpose of the debt ceiling is symbolic – forcing the legislature to acknowledge how much borrowing it has caused to be necessary – it fails to achieve this goal effectively, as it mainly serves as a vehicle for political posturing to the effect that its the other party that’s to blame.
So: my modest proposal:
Replace the debt ceiling with a Medicare ceiling.
Right now, spending on Medicare is automatic, the result of a set of formulas enacted by the legislature. But it doesn’t have to work that way. It could be subject to a statutory spending limit. A budget, if you will, that the legislature would have to approve, annually. And if spending was projected to exceed the budget, HHS would have to go back to Congress either to get supplemental spending approved – a revision to the budget; a raise in the ceiling – or changes to the formulas that would bring projected spending down below the ceiling.
Obviously, simply adopting a budget isn’t a solution to the growth of Medicare (though that is the essence of the Ryan Plan’s solution: hand out vouchers and limit the amount of money you spend on the vouchers, counting on the private sector to provide at least some insurance package for the amount of the voucher). But if we’re going to have some kind of symbolic provision to try to drive spending restraint, it makes a whole lot more sense to me to have that limit relate directly to spending – and, more specifically, to the spending that is actually driving the scary projections that you see for mountains of debt in the future.
And there’s at least some precedent for adopting a budget for Medicare, since I believe this is the way it’s done in other countries that have government-provided health care services or insurance.
I’m extremely sympathetic but also extremely skeptical. The thing is that we basically already have a “Medicare ceiling” with the Sustainable Growth Rate and it’s proven to be a complete failure thanks to the annual and fairly uncontroversial ritual of the “doc fix.” Of course the debt ceiling increase was also an uncontroversial and (approximately) annual ritual until about six months ago so it’s possible that GOP could use “doc fix” to force a fight just like they just did with debt ceiling. However I rather doubt it since it’s more of a political winner to vaguely attack “spending” (implicitly understood to be unpopular but tiny discretionary programs) than to attack a specific spending item in the face of opposition from several well-organized lobbies (AARP, Pharma, SEIU, etc).
— gabriel · Aug 6, 07:02 PM · #
I’ve long thought we should have something along the lines of your Medicare ceiling. But it doesn’t need to replace a debt ceiling, which contrary to your statement, has been shown in recent weeks to provide a very rational purpose. It finally started to fulfill its purpose.
— The Reticulator · Aug 7, 05:50 PM · #
Although I like the idea and its precedent, in our current political landscape, I find it hard to pass. It would be too easy for politicians against such a cap to spin it as rationing or limiting peoples’ medical coverage.
— Justin · Aug 8, 11:19 PM · #
Two comments: one, I don’t think most Americans realize that Canada implements our single payer medicare system with a system of block grants from the federal government to the provinces. These block grants come with five conditions set out in the principles of the Canada Health Act: universality, portability, comprehensiveness, public administration and accessibility. Provinces with plans that meet these conditions get a cheque from Ottawa every year. The size of this cheque depends on what Ottawa can spend. In other words, Canada’s system resembles Paul Ryan’s proposal in a number of ways.
But I insist that government exercises the comprehensive control of medical practice which more than anything else makes costs difficult if not impossible to control, by delegating the power to determine who can practice medicine. If you want to control medical costs, and for that matter if you want to control legal costs, you have to eliminate the last of the medieval trade guilds: the law society and the medical society, both of which derive their powers from government statute.
— John Spragge · Aug 14, 11:19 PM · #