The replacement

For whatever reason, these days I get a lot more e-mail from the Democratic Party than I do the Republicans. (Perhaps the GOP stuff ends up in my junk mail somehow?) A lot of the time the Democrats’ stuff is comedy gold, although they are getting more than enough mileage out of vilifying the already easy to vilify Donald Trump.

Now I’m going to do something I try not to do here, and that is accept their word as gospel for the sake of argument. Lord only knows what kind of Astroturf George Soros, Peter Lewis, and other big-money far-left donors can gin up for rent-a-mobs, but as I said this can suffice as their case. This is an excerpt from an e-mail I got today.

Republicans are frantically trying to dodge their constituents who want answers about what’s going to happen to their health care.

Virginia Congressman Dave Brat recently complained that “since Obamacare and these issues have come up, the women are in my grill no matter where I go.” Another Virginia Republican, Congresswoman Barbara Comstock, skipped out on “office hours” with her constituents after dozens showed up to ask about her Obamacare replacement plan.

When Arkansans showed up at Senator Tom Cotton’s office to ask about their health care, staffers locked the door and turned them away. Sixteen constituents showed up at Congressman Peter Roskam’s office in West Chicago to voice their concerns about repealing the Affordable Care Act and were told their meeting had been abruptly canceled. Congressman Mike Coffman from Colorado was caught on camera sneaking out of a constituent event through a side door to avoid his constituents’ questions about health care.

After more than 200 people submitted questions for a Facebook town hall with Sen. Thom Tillis, the senator logged off 11 minutes into the 30-minute event.

The Affordable Care Act is more popular than ever. Millions of Americans are reaping the benefits of access to affordable care — and 30 million stand to lose their health care if the law is repealed.

Again, this all may be “fake news” but here’s something that’s not fake: those who don’t want Obamacare repealed are probably the few profiting off of it at the expense of the many, which constitutes a great deal of working America. Since the RCP average has tracked the question in 2009, there has never been a majority in favor of Obamacare. To say it’s “more popular than ever” is true to the extent that it’s less of a dog than it has been.

And the other “fake news” is that oft-repeated claim that Americans will lose their health care if the Affordable Care Act is repealed, and that’s not so. It’s federal law that emergency care has to be provided regardless of ability to pay. Nor is this considering how many people have decided to take their chances with the tax penalty since it would be less expensive than health insurance.

So this is a message to Republicans who are getting cold feet about repealing Obamacare: find yourself a fire and warm them up – let’s do this thing. The Democrats are so full of crap their eyes are brown: America wants Obamacare to be gone!

Yet there is the question of cost, because medical expenses are, well, expensive. I have a theory on that, though, and it relates to a similar phenomenon in another aspect of life.

Look at the cost of college tuition as an example. To some, the cachet of a degree at a prestigious university is irresistible, and they will pay whatever it takes to get it. Some people who are more academically suited to a state university still demand to go to an Ivy League school, and those schools know this. They also know that a) these students will likely go many thousands in dollars in debt, and b) they get paid up front by the federal government. Whether the student pays back his or her loans or not is immaterial to them because they got their money, and because of that these schools are padding their tuition and fees because they can. Maybe it’s to increase their endowments, but oftentimes it’s to provide non-educational amenities.

Let me share a story with you. I went to college from 1982-86 at Miami University in Oxford, Ohio. It was selected because it had the program I sought to major in and was in-state so my tuition was lower – although higher than most others, as it had the reputation of being the best state school in Ohio academically. (So there was a little bit of cachet factor, too.) Very nice campus, relatively solid education. I would have been happy to see my older daughter go there, but she had other plans.

My wife at the time was a non-traditional student who had gone to another school before having the older daughter in question (I’m her stepdad.) So, after we married, she enrolled at the University of Toledo, which is more of a commuter school. Yet one thing they had was a state-of-the-art recreation center, paid for by the state since UT is a state school, too. I got to enjoy the facilities on occasion since my ex was a student, and they were nice. Soon enough, all of the other state schools were getting in line to have similar facilities put up and sometime in the 1990s, well after I graduated, Miami got theirs. While it may have been beneficial for the small percentage of those who majored in physical education, the real reason these were put up was so each of these state universities would have something to attract students. More students = more tuition and fees = job security for the thousands of university employees. And as I said: they got their money up front, never mind the students were saddled with debt for a decade or more. (As I recall, I didn’t finally pay my student loans off until 2001 or so.)

Now look at the medical field. Obamacare placed it in a similar position to that of state universities because it was flush with federal cash – as originally envisioned, people would either have their medical care paid for directly by the federal government (Medicaid) or they would give insurance companies a captive audience with relatively few choices via the exchanges. Insurance companies, in turn, were supposed to have “risk corridors” and other accounting tricks and bailouts to make them whole – the only people who would be left holding the bag would be the ones who actually paid for the insurance, and many of them on the individual market received subsidies from Uncle Sam, too as well. No wonder it cost a trillion dollars a year.

The weakness of the Obamacare system is that there’s no real incentive to cut costs. Yet there are two groups of beneficiaries who stand to lose the most if the ACA is repealed: those who are getting the subsidies or “free” insurance from the government and those providers who have been able to just keep raising prices because there’s a massive pot of money they want to get their paws into. Therein lies the rub: Obamacare is now in a place where it cannot be just cut cold turkey – there has to be a year or two transition period, and of course that gets into election time.

It’s worth reminding readers that Obamacare has its roots in what some dubbed Romneycare: the insurance mandate Massachusetts put into place several years before. To be quite honest, that is where the solution lies. Perhaps it would be appropriate to block-grant funding to states for a interim period of up to three years and allow them to tailor their own programs and set up funding mechanisms. States can choose to have all the bells and whistles or they can choose to invest their resources elsewhere, and that’s the way it should be. I think this would take care of most (but not all) of those who are getting the largest benefits. The others can vote with their feet if they so choose: government is not supposed to be all things to all people.

On the cost side, I think any and all federal insurance coverage mandates should be scrapped, allowing states to set their own systems and priorities. Now it can be argued that having 50 different systems would be difficult for a health insurance provider to navigate, but auto insurers already do this. There are advocacy groups out there that suggest how states can streamline the process by being similar to other states, so I suspect most states will have health insurance requirements that are fairly similar. Maryland may have the extreme in required coverage on one end while Texas may be the flip side. Because of this, I’m not sure selling insurance across state lines is necessarily doable in the respect that I can’t buy a Texas policy living in Maryland. But states should be encouraged to allow insurance products that reflect everything from the catastrophic coverage health insurance was originally to the Cadillac plans that pay for everything, even your hangnail or gender reassignment surgery.

So, the replacement for Obamacare is a more free market and freedom of choice to participate. Sorry, Democrats, but Obamacare has to go to help make America a healthy nation again. If Andy Harris has a townhall, hopefully he will stand his ground and make the case for repeal.

What could possibly go wrong?

By Cathy Keim

Last month I wrote about Governor Hogan expanding the You’ve Earned It! subsidized mortgage program for young adults with college loans. Politicians can never resist giving away other people’s money especially if it makes them seem caring and gets votes.

For a quick review, college student loan debt is now at 1.2 trillion dollars and growing. The average debt for a four-year degree is $29,000, but it can skyrocket to $100,000 or more for a graduate degree. This debt is having huge impacts on young people that are starting their careers severely burdened with loan repayments. These young voters are prime targets for politicians. Wouldn’t you vote for somebody that promised to get rid of your debt?

Unfortunately, the politicians are aiming at the wrong target to cure the problem.

A study released in July by the Federal Reserve Bank of New York was only the latest piece of evidence of what conservatives have long knew: Increasing public support for college tuition, especially in the form of federal tuition subsidies, has inflated its total cost.

Every time the politicians make student loan money easier to obtain, the colleges just raise the tuition costs. Colleges and universities have increased their administrative personnel by 60% between 1990 and 2003. The university presidents and top administrators make CEO-type salaries in the 7-digit category. And let us not forget the building programs. Many schools have swimming pools with floating rivers for relaxation. The students certainly should be stressed just thinking about how they are going to repay all the loans they took out to attend the institution.

In 2006 the cap on loans for graduate school was raised and the borrowing levels skyrocketed. Many of these students will avail themselves of the debt forgiveness programs to handle the loans. For example, Georgetown University created a clever loophole: if a law grad works for the government or a non-profit for ten years with a salary under $75,000 per year, then they can qualify for a loan forgiveness program. Who wouldn’t borrow money, not only for tuition but also to live on, if they know it will be forgiven?

President Barack Obama came out with free community college. Governor Martin O’Malley and Senator Bernie Sanders are topping that with four years of college for free.

Hillary Clinton has offered up a package that many voters with college loans will find attractive.

In a more blatant payoff, Clinton proposes not only offering new subsidies for those who are going off to college, but also new subsidies for those who already left. But “refinancing” student loans and offering more generous income-based repayment plans will do absolutely nothing to improve education attainment or economic competitiveness. It is simply a transfer from the federal fisc to Americans with above-average educations and incomes. Income-based repayment is not a bad idea per se, but Clinton’s plan includes forgiveness after 20 years, which is a huge payoff for those with the biggest loan balances.

Would you be more likely or less likely to borrow money if you knew that in twenty years the loan would be forgiven, no questions asked? For those of us that live in the real world, the answer is absolutely: not only will people borrow money, they will borrow more money. If you were guaranteed that you would not have to pay it all back, then why would you scrimp and do without when you can live in luxury?

Hillary’s plan is almost entirely silent on controlling total costs, and, by increasing the supply of low-cost loans, the level of funding from state governments, and increasing other subsidies, proposes to lower out-of-pocket costs in the way that we’ve already seen will backfire.

Every time Washington proposes to fix something, it usually gets worse. They are already micromanaging the public school system from DC with mandate after mandate. The more they get involved in the university system, the more of a quagmire it will become. The college marketplace needs to be subject to local and free market forces. Then it will be able to react to the demands of the students and parents, not to the mandates of the feds.

The increases in tuition are not going to hire and pay more professors. Professors’ pay has not increased; in fact, more college instructors are poorly paid adjunct professors that teach by the course for far lower salaries than tenured professors. Just like with our public schools, much of the money gets eaten up by administration costs to ensure that the mandates are met.

While these plans will not contain college costs, they will achieve their goal of bringing out self-interested voters for the presidential election.

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