L'Esprit d'Escalier, Supreme Court Edition

It's French for "staircase wit," meaning all the clever remarks that occur to you immediately after you leave the party. Not being notably quick verbally, I can sympathize with Solicitor General Verrilli for sometimes having trouble, at the Supreme Court's recent health-care jamboree, fielding questions from out of right field. Herewith, some wittier answers.

JUSTICE SCALIA: Could you define the market -- everybody has to buy food sooner or later, so you define the market as food, therefore, everybody is in the market; therefore, you can make people buy broccoli.

CLARITAS: [All the law students listening to the audio have a drink at the first mention of broccoli. Some of them will end up under the table; the index to the transcripts lists eight occurrences of the word.] No, Justice Scalia, that would be a good analogy if the health care law said that people had to have heart transplants, but it doesn't.
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JUSTICE SCALIA: Mr. Verrilli, you could say that about buying a car. If people don't buy cars, the price that those who do buy cars pay will have to be higher. So, you could say in order to bring the price down, you're hurting these other people by not buying a car.

CLARITAS: No, we're saying that by not buying insurance, they're shifting costs onto other people, just like when a car doesn't have pollution control equipment. There's been an extraordinary amount of energy devoted to the claim that this law is completely unprecedented, that it's making people buy a product, that it's regulating "inactivity." Actually, it's no different from when the government makes drivers buy catalytic converters, which is clearly Constitutional. The only difference is that people can, in theory, choose not to drive, but everyone uses health care. 

It's also true that the problem is worsened by not allowing insurance companies to exclude people for preexisting conditions, which leads to higher prices, but it's hard to think of a car analogy there.
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GENERAL VERRILLI: No. It's because you're going -- in the health care market, you're going into the market without the ability to pay for what you get, getting the health care service anyway as a result of the social norms that allow -- that -- to which we've obligated ourselves so that people get health care.

JUSTICE SCALIA: Well, don't obligate yourself to that. Why -- you know?

CLARITAS: Justice Scalia, since you've said you'll resign if there's ever any conflict between your duties as a justice and your Catholic faith, I hope it's not true that your best solution to this Constitutional question is, "Let 'em die!"
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JUSTICE SCALIA: An equally evident constitutional principle is the principle that the Federal Government is a government of enumerated powers and that the vast majority of powers remain in the States and do not belong to the Federal Government. Do you acknowledge that that's a principle?

CLARITAS: So what you're saying is that the Constitution reserves to the states the power to make people buy broccoli?

Health Numbers We Can Do Without

I was looking forward to reading Ezekiel Emanuel's opinion piece in The New York Times online about health-care costs. Looking forward, at any rate, to banging my head against the wall as he made the arguments that brother Rahm should have suggested to his boss two years ago. I was disappointed.

Instead, Emanuel first tries to give an idea of the size of health care costs with the hoary old stack-of-dollar-bills image so dear to Ronald Reagan. Can we please stop doing this? You can use it about virtually any number concerned with the US economy, and it sounds huge.

Actually, all it shows is that we're a big country. In population we're now the third-largest country in the world: there's China and India, and then us. If you stacked  up all Americans head to foot they would reach from here to the moon and beyond (assuming an average height of 4.5 feet, which seems conservative). If you put the whole U.S. GDP into one dollar bills, it would make a stack from the earth to the moon, back to the earth, back to the moon, and halfway back to earth. Or we could put it into pennies, and then it would go from here to Saturn and halfway back. Does this actually tell us anything? Americans' spending on things to read would form a pile of dollar bills four times the height of the International Space Station. Is that a lot or a little?

Emanuel has more comparisons, and again, all they prove is that the US is a big country. We spend as much on health care as France spends on everything. But we spend as much on cosmetics as Iceland spends on everything. Again, so what?

Here is what you need to know about health care spending in the US in a nutshell:

1. Over the next ten years, we'll spend about $30 trillion on health care. 
2. The cost of the health care reform bill is about 3% of that. Since almost half of all health care spending goes through the Federal government, the cost of Obamacare is about 6% of current Federal spending on health care.
3. We spend about $2500 more per capita than the next-most-expensive health care system in the world. That's $10,000 for a family of four. The next-most-expensive health care system in the world has universal care and better health statistics than we do.
4. Implication: It's not at all hard to believe that Obamacare, while covering tens of millions more people, could improve efficiency enough to decrease total Federal health care spending (and, a fortiori, total US health-care spending).

Throw in the fact that we rank between 30th and 40th in the world in life expectancy and infant survival, and you've got everything you need to hold your own at your next cocktail party.

[Notes: A dollar bill is about 0.1 mm thick. A penny is 1.5 mm thick, so a dollar in pennies is about 1,500 times as thick as a dollar bill. The average distance from the earth to the moon is about 384,000 km; the minimum distance from the earth to Saturn is 1.2 billion km. The 2010 US GDP was about $14.5 trillion.]

Pretzel Logic

So let me see if I've got this straight. The deficit is bad because it's "intergenerational theft." So for the sake of future generations, we must do something about the biggest source of future deficits: Medicare.

Rep. Paul Ryan, the Republican who's chairman of the House Budget Committee, has a plan. Not so much a plan as a Path to Prosperity. Here is what we're going to do about Medicare:

If you're retired now, nothing.

If you're over 55, also nothing.

If you're under 55, keep paying those Medicare payroll taxes. Then, when you get to retirement age, you get a voucher allowing you to buy private insurance! Of course, since private insurers have higher administrative costs than Medicare, and pay doctors more, your voucher won't buy as much coverage as Medicare now does.

But really, the problem with Medicare is not so much what the government is paying now as what it will pay in the future. Health care costs have been rising faster than inflation for some time now, and the Congressional Budget Office projects they will continue to rise about 2% per year faster than inflation. The Ryan plan deals with this problem very simply. It indexes the value of the voucher to inflation.

Well, no, this doesn't actually do anything about rising health care costs. But it does shift them off the backs of future taxpayers. It shifts them onto the backs of... future retirees.

So here's what we're doing for future generations under the Ryan plan: They pay for current retirees. Then when they reach retirement age, they get a medical benefits package that's worth substantially less than the package those people were getting, and still less with each passing year.

Not so much intergenerational theft as intergenerational rape.

And for those who are, or will qualify to be, in the old program, don't worry. Republicans believe in freedom of choice. You will be completely free to give up the better package and get the worse one.

Just don't get trampled in the stampede.

TV Is Bad for Us...Half of It, Anyway

I was quite taken with the "V" miniseries of 1983 about alien invasion. It had nice little touches, like a reptile disguised as a human swallowing an entire mouse whole. So I was certainly giving the benefit of the doubt to the new series, especially since it has a star I like.

My disenchantment started when the aliens offered Earth people what was explicitly called universal health care, which only the few in the heroic underground realize is actually a plot to monitor and control humans. Then we had a decision by the deluded majority to grant visas to the visitors (or do they plan to stay?), turning them literally into legal aliens. All part, of course, of the aliens' secret plan for world conquest.

Finally, in the last episode, we had a revival of the idea that torture is a quick and reliable way to get truthful information, which squeamish moralists choose to leave to the more tough-minded. (Oddly, they use the Spanish Inquisition as an example.) Just when you thought the coming end of "24" would let that idea fade from the Zeitgeist, here it is again. Oh, and don't let your son have an alien girlfriend.

That's it, ABC. I quit. I hope many others join me.

Mopping Up Health Care

It's hard to blog on public policy right now, as there's a sort of news vacuum caused by the absence of health care (the House passed the slightly revised reconciliation bill a few hours ago). Now the networks are finally explaining what's in the bill, and anyone who watched Diane Sawyer the other night on ABC must be wondering what all the fuss was about-- everything she described sounded so, well, reasonable.

A few final memories: John Boehner saying that although people were angry at the Democrats and felt they weren't being listened to, violence is bad; a youngish protester in front of the Capitol saying that Obama wanted to take his private property, and he was not OK with that (can anyone even tell me what he's referring to?); the spectacle of someone who nearly sank the bill over his opposition to abortion being called a "baby-killer" (oh, sorry, the words "This bill is a..." didn't come through clearly, like the "a" in Neil Armstrong's "One small step for a man...").

Update: Well, it's getting less amusing. Rep. Stupak, the "baby-killer" mentioned above, has become one of the main foci of hatred. What is the world coming to when this guy is a hero? I guess it proves once again that no putatively good deed goes unpunished: If he had not made himself so prominent demanding changes to the abortion language in the House bill, if he had said that the Senate language was good enough for him, as it was for a zillion nuns and Catholic hospitals, people would be paying no more attention to him than to Rep. Himes (who?). Now the crazies feel like jilted lovers. For tape of some the comments made on his voicemail, go here. Interesting to note what is bleepworthy and what isn't at CBS. One of the words that comes out as a long bleep at CBS I heard elsewhere as "mother[bleep]". Also note "ass," in the fully anatomical sense, but "son of a [bleep]."

What is most discouraging about all this is the tepid, blaming-the-victim response of Republicans. I guess the new meta-theme of this blog will be our dysfunctional politics and what can be done about it. More soon. In the meantime, here's an e-mail I sent to Newt Gingrich, which I'm sure will solve the problem:

Dear Mr. Gingrich:
I always thought you had some personal integrity, so I am shocked and disappointed by your recent comments saying the Democrats are partly to blame for the threats and violence against them, and comparing them to remarks against Bush and Cheney. If someone said to you, "I hope you bleed out the ass and die," (as someone did to, of all people, Rep. Stupak), would you say, "Well, I was asking for that"? I don't think you would, nor should you. I think you have betrayed your responsibility as a political leader because you want the votes of the lunatic fringe. It doesn't seem to me hard to say, "We're all Americans, and we need to respect political opinions we disagree with." But evidently it's too hard for you. Shame on you.
  Howard Frant

Soak the Rich

When I was in grad school, the professor in my microeconomics class commented one day, in the course of a class discussion, that one couldn't really produce all that much revenue just by raising taxes on the rich, because there wasn't all that much money there. The idea was that if you multiply a high annual income by a small number of people, you get a number that's not very big. Therefore, any serious revenue-raising had to come from hoi polloi, the multitude of the middle class.

Was he right? It depends on what you consider a lot of money, and what you consider rich. In 1981 (approximately when my professor made his comment), the top ten percent of the population had about 35% of the total income in the U.S. (My figures come from here, an updated version of what is generally considered to be the best source. They may not be exact, because I'm reading them off a graph.) This is a reasonably large chunk of money, but it extends well down into what would normally be considered the upper middle class. If you look at the top one percent (still around a million households) the total was only 10% of total income. And if you want to go after the super-rich, the top 0.01%, the total was only about 1.5%.

That was then. What about now? Times, it turns out, have changed. There has been a substantial growth in the share of the top ten percent; that segment now gets some 50 percent of the total income. (By "now" I mean 2007.) What is much more interesting is that practically all of that growth (13 out of 15 percentage points) is accounted for by the top 1% of the population. The share of the top 1% has gone from 10% in 1981 to a startling 23% in 2007. That's a little over $3 trillion. The super-rich have gone from 1.5% to 6% of the total, or about $830 billion. That strikes me as serious money. Roughly speaking, if we took another ten percent of the income of the top hundredth of one percent of the U.S. population, about fifteen thousand households, it would pay for health care reform.

Sorry, I'm so stunned that I'm going to repeat that. Take the 15,000 highest-income households in the U.S. Take another 10% of their income. That's enough money to pay for health care reform.

Addendum: The 2006-2008 American Community Survey estimates an average household size of 2.61 and household population of 293 million, for 112 million households. So 11,200 seems a reasonable estimate of the top 0.01%.  But the reference above gives a figure of 14,988, so I've used that number. I can only conclude that the IRS is using a very different definition of household than the Census is. A bit under 3% of the population lives in "group residences" (for example, prisons, nursing homes, military barracks, college dorms), but that doesn't come  close to accounting for the difference.

More on Cadillacs

The rumor today is the Congressional conferees will go with the tax on "Cadillac" plans. Presumably some Senate "moderates" (I guess it's all relative) object to the idea of taxing families with incomes over $1,000,000. Remember when a millionaire was someone with a million dollars in net worth? Even today, having a net worth of a million dollars puts you somewhere in the top 10% of American families (according to the Fed's Survey of Consumer Finances). But we've become so jaded that when people in Congress talk about a "tax on millionaires," they're talking about families with annual income above a million dollars. And taxing even those people is apparently too much for some Democrats.

Meanwhile, I'm still (see December 28, 2009) trying to figure out what these wasteful plans are. I've hunted around the Internet trying to find some evidence that patient choices are a big contributor to waste in health care, and so far I haven't been able to find it. If you know, please tell me. There's a lot about doctor choices, but...

My concern (speculative at this point), is that a lot of the higher-priced plans are ones whose "extras" include dental and vision coverage. But, as I said before, that's clearly a part of basic health care. Being able to go to the dentist or get glasses is not a big deal to the middle class, but for some people it's a very big deal.

For those of you who like true-life stories, take a look at this article by the AP. [Note 3/13/10: The article, "Lessons of a weekend of free health care," by Adam Geller, 1/3/10, has been archived by the AP. If you don't want to pay $1.50, try this instead.] It describes people in Tennessee who drive for hours (and sometimes arrive the night before to get a good place in line) to get into a one-day free medical clinic. The most telling point in the story is that, although almost all of them have medical problems, many don't mention them for fear of losing their chance to get dental or vision care.

Those of you who are more statistically inclined might want to take a look at this information from the CDC. Here are some statistics for people age 45-54 (I chose one age cohort because there were no totals).

Untreated tooth decay: Poor 45%, Near-poor 40% Non-poor 17%
Loss of all natural teeth: Poor 12%, Near-poor 11%, Non-poor 4%

For the woman who was the protagonist of the AP story, having all her teeth pulled was the happy ending. That meant she no longer had to live with constant throbbing pain. (What's even more maddening about this story is that she probably votes Republican.)

Addendum: The Times health blog reports on January 14 that as of 2015 (why 2015?) dental and vision costs will not count toward the threshold for the tax. That's good news, but leaves me more mystified than ever about what's in the high-priced plans. So far, no stampede to include vision and dental as part of what's required for all plans. That's intended humorously--we won't see that in the near future.

Now, About Those Cadillac Plans

We read that all health economists favor the tax on "Cadillac" health plans as a way to control costs. If that's really what they think, I'm willing to listen. But I'm skeptical.

Yes, there's a strong argument for taxing things like free spa weekends. These are essentially a tax dodge, driven by the fact that wages are taxed and health benefits aren't. But it seems unlikely that benefits like this are huge contributors to the high cost of American health care.

A lot of plans are high-cost simply because they have more complete benefits. For example, some include vision and dental coverage. But basic vision and dental coverage should be (in my opinion) part of every basic plan. There are a lot of low-income people who just can't afford to get dental care, and never do, and as a result have bad teeth. And eyeglasses? OK, maybe not Armani. But none?

Other plans are higher-cost because they have low copayments and deductibles. The basic idea of co-payments and deductibles in health insurance is the same as in auto insurance: to accept some increase in the risk people bear in order to make them pay part of the costs of their decisions. The hope is that making the insured bear some part of the cost will lead to less frivolous use of the resources, such as, in the case of health care,  visiting the doctor every day for insignificant complaints or just to have someone to chat with.

The question is how much cost-bearing is the right amount. This is especially tricky in health care, because bearing more of the cost may result in not going to the doctor enough, leading to more high-cost emergency room visits and hospitalizations, as in this study. And covering 60% of the cost, as the lowest-cost plan in the Senate bill does, seems to my inexpert eye not enough to keep people from getting into serious financial trouble from health problems.

Bear in mind that in some countries patients have no copayment, and yet those countries have much lower health costs than we do. I don't know what fraction of health care costs are accounted for by patients choosing to overuse services, but I'd guess (and that's all it is) that it's more than negligible but less than large.

So I'd have to see more evidence before I accept the claim that the Senate's tax on high-cost plans will significantly improve efficiency. And I'm totally mystified by the claim that taxing the very rich, as the House bill does, is an inappropriate way to pay for health care.

It's probably nothing,but...

For a variety of statistical reasons, please don't overinterpret the following fact, but all the same it's striking: In the recent Senate vote on drastically tightening abortion restrictions in the health-care bill, seven Democrats voted in favor. All were men. Two Republicans voted against. Both were women.

You Read It Here First

While I'm thrilled if Gail Collins is really reading this blog, I wish she'd mention my name, or at least include a link. Her November 11 Conversation with David Brooks in the New York Times online makes exactly the points of my October 14 entry on the filibuster, complete with references to Jimmy Stewart and Southern Democrats. On balance I'd say hers is a bit funnier, though less prompt and lacking the useful coinages "honest filibuster" and "virtual filibuster." As a bonus with Collins, you get some pointed comments on Joe Lieberman, whom neither of us, I'm sure, would ever dream of calling the Christine Jorgensen of the Democratic Party.

Elephantine Encephalitis?

One David Catron, whose articles in The American Spectator include, among others, "The AMA's Quisling Strategy" and "Obamacare Could Kill You," has a blog called Health Care BS: Cleaning the Augean Stables of the Heath Care Debate. A recent post introduced readers to the Prisoner's Dilemma, the much-loved game theory construct in which individuals following their own self-interest end up creating a situation in which everyone is worse off.

So what is Catron's policy application of the Prisoner's Dilemma? Greenhouse gas emissions? Overfishing? Highway congestion? Gun ownership? Support for the poor? Standing up at baseball games?

No, his application is to... the public option. Yes, his claim (based on an irony-free reading of Andrew Sullivan) is that the public option is politically insidious, because it encourages voters to follow their individual interests in cheaper health care at the expense of the general good.

The first problem for Republicans, of course, is that he is in effect conceding that individuals could get cheaper health care through the public option. And he's not too specific about what the collective downside is. Hospital closures? Socialism?

But the bigger problem is that Republicanism in the twenty-first century is fundamentally hostile to the idea that there could be a conflict between individual self-interest and the greater good. Telling Republicans about the Prisoner's Dilemma starts you down a slippery slope. Pretty soon you're conceding that there might be a role for government in a free-enterprise economy. That the market can't do it all. That sometimes we need government regulation and government spending.

If too many people read his blog, Catron may find that he has introduced a virus into the central nervous system of the Republican Party.