In the Arena

Kennedy’s Great Mistake

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At least, Kennedy thought so: his refusal to cut a deal with Richard Nixon in 1971 on universal health insurance. (Well, it was his greatest public policy mistake.) As Steve Pearlstein writes in the Washington Post today, there are lessons in that for Democrats. I think Pearlstein’s prescription is generally ok, with one exception: the employer mandate. It’s an unfair and onerous burden in a global economy where companies in most other industrialized companies (and developing ones, for that matter) can price their products without the additional cost of providing health care for their employees.

Transformation toward a more effective health care system would require a slow shedding of employer-provided insurance. The first step in the right direction would be to allow employers to join the health care exchanges–regional health insurance super-stores–that any reform plan must have. The greater the market power gathered in the exchanges, the better the chance of controlling health care costs. (Think about the pricing difference between a supermarket and a mini-mart.) Indeed, this is one very attractive feature that Obama has neglected to sell: the exchanges will mean lower prices, immediately, for everyone who buys health insurance individually now and for all the small businesses that choose to participate. September is back to school month for politicians as well–and one hopes the President will take the opportunity to seize the initiative.

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