In the Arena

Policing Armey

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Sorry to fall down on my on self-appointed role of Dick disputant, but I’ve been, uh, working…
Past deadline now, and I want to respond to our guest’s response to the Republican debate. First, it was interesting to see Giuliani pick up on Armey’s any-universal-health-insurance is socialism riff. Question: Does that include Mitt Romney’s individual mandate plan up in Massachusetts? I mean, that Romney! He just channels Emma Goldman.

But let me take on Armey with regard to entitlements. First, social security. I actually went down to Chile ten years ago and looked at that country’s privatized plan. It was excellent–but…the money was there to fund private accounts for younger workers because the government had had a windfall, privatizing the industries than had been socialized under Allende. Also, the plan was regulated in a that Dick Armey would never allow: there were a dozen or so mutual funds that you could invest in, most of the investments were non-risky (less than 10% in private equities) and some of the investments were of great social utility–investments in building low-income housing for workers, for example. You for that kind of regulation, Dr. Armey? I didn’t think so.

As for social security here, partial privatization is a sideshow, unaffordalbe because we have such enormous outstanding obligations to my sad, self-indulgent, obnoxious baby boom generation. A voluntary add-on program, suggested by Gene Sperling, with government matching funds according to income, is a good idea. But, to my mind, the social secuurity “crisis” is well down the list of priorities. It can be solved fairly easily: by raising the retirement age progressively. That is, according to income: the more money you have, the older you are before social security payments kick in…Bill Gates should be, like, 80. You and me, Congressman, maybe 75 or so. Or we can eliminate the income cap on social security payroll taxes. Have it work like the Medicare payroll tax. This is not rocket science. Just painful politics.

As for Medicare, it and Medicaid both should be part of a comprehensive national system where everyone gets to choose from an array of plans, like the current Federal Employees System. No more Medicare fee-for-service, to be sure, which will save money. Taking the poor out of the emergency rooms and giving them preventive care will save money–and provide a better chance for success–too.
The fact is, there are enormous economic inefficiencies in the current system. It hurts the international competitiveness of American companies. It causes people to stay in jobs they don’t like; it makes it less attractive for them to strike out on their own as entrepreneurs. A plan like Ron Wyden’s–oy, say the Swampland masses, there he goes again on Wyden–would address all these and two other fundamental unfairnesses of the current system: It would end the free-riding done by healthy young people who can afford to buy health insurance (and whose hospital bills we pay for when they get into accidents) and it would end the free-riding done by insurance companies who can cherry pick those they want to cover. It would help the working poor buy insurance.

Remember, we have a system of universal health insurance right now. It’s a system where those of us have insurance pay, through higher premiums, the medical bills for those who don’t have any. That’s socialism, I say! Just kidding, but it is pretty damn inefficient.

Oh, and a friend asked me to ask you this: If you’re so concerned about government spending, why did you abet the Bush administration’s lifting of the pay-as-you-go rules for the federal budget in 2001?