The fallacy of the neutral default position

I tend to be reasonably skeptical about the federal government’s ability to produce the exact results it intends when it legislates, but Alexander’s argument assumes that not doing anything (or undertaking a “step-by-step” approach) won’t do any harm to Americans or the federal budget. The Boehner approach only insures 3 million more people (barely above the rate of population growth) and includes none of the cost-savings of the House or Senate bills.

Related to the do-nothing assumption is the belief that any attempt to reform healthcare means introducing government into a neutral policy vacuum, as if the current system is a utopia of government non-interference. It’s not as though Democrats are proposing that government should involve itself in healthcare for the first time ever. Medicare, Medicaid and the Veterans Healthcare System are the most obvious examples, but seemingly subtle things like the employer tax exclusion have just as big of a reach into our healthcare system.

The present arrangement has incentivized skyrocketing costs while keeping wages stagnant. It’s hardly the pristine landscape untouched by human hands that Republicans are painting. The whole reason for reform is that the existing healthcare system creates a multitude of incentives that produce costly, limited care with poor health outcomes.

The gulf on this key point was illustrated perfectly toward the end of the daylong summit when Sen. Ron Wyden (D-Ore.) made the point that the default position is not neutral:

… on the incremental plan, the evidence shows that incremental reform not only does less, it costs more … We have been doing incremental reform in this country since 1994, since the blowup of the Clinton plan, that’s exactly what we’ve been doing and costs have been gobbling up everything in sight in the private sector and in the government. So I would submit that instead of this debate about incremental reform, comprehensive reform, we could all be for real reform. And real reform, in effect, changes the incentives that drive the system and particular empower the consumer.

Sadly, right after Wyden spoke, Senate Minority Leader Mitch McConnell (R-Ky.), sounding like someone who had thoroughly lost the policy argument, clung to polls and the default position. Wyden, unlike McConnell, realized not reforming healthcare is the same as choosing a broken system.

The views expressed in this blog do not represent the views or opinions of Generations United.