This is, I think, a tempting non sequitur: no legislation of substance is going to pass the US Congress until the Republicans succeed in taking back the House and gain enough seats in the Senate for bills to be crafted on a truly bipartisan basis. From an electoral point of view, it would be foolish on the Republicans’ part to do anything more than obstruct until they make significant electoral gains, which may come as early as this November.
All true as far as Republicans are concerned, but the President and his party might still get their act together and pass legislation through the reconciliation process and by other means. Barack Obama may yet turn out to be a great President, despite a first year in office in which his signature cause, the effort to pass health insurance reform, failed.
Obama would turn out to be a great President if two things took place. First of all, between now and November, Obama and his party need to pass legislation that mandates the purchase of health insurance by the federal government, the states, employers, and/or individuals, in the case of all US residents. Of course, the President has to do that with the majorities he has, not the ones he wishes he had. A stark irony: there is no politically feasible way to pass such legislation except by not raising taxes and not cutting benefits. In short, passable legislation will make federal and state deficits even more unsustainable than they are now.
But it is necessary to make the budget crises of federal and state governments worse before making them better. Let me explain.
That’s because the second thing that needs to take place under Obama’s watch is that all three major entitlement programs, Social Security, Medicaid, and Medicare, are put on a sound financial basis. A coalition of conservatives and liberals might accomplish this if and only if health insurance was universal: otherwise liberals have no incentive to sign on.
What entitlement reform must consist of is not rocket science. Robert Samuelson:
At age 65, average Americans live for another 18 years. Government now subsidizes each of them an average of about $25,000 a year (almost $14,000 Social Security, $11,000 Medicare). We cannot sensibly afford all these subsidies without oppressive tax increases (see above), deep cuts in defense and other programs or immense budget deficits that someday might trigger another financial crisis. . . . By the administration's estimates, that publicly held debt (the accumulation of all annual deficits) balloons from $5.8 trillion in 2008 to $18.6 trillion in 2020.
Eligibility ages for both Social Security and Medicare should be gradually raised to 70, coupled with a requirement for people to buy into Medicare at 65. Wealthier retirees should receive lower Social Security benefits and pay more for Medicare. Programs that have outlived their usefulness need to be abolished: farm subsidies, for instance. Even with these cuts, future taxes would need to rise. Unless you're confronting these issues -- and Obama isn't -- you're evading the central budget problems.
Samuelson’s list is good as far as it goes, but it is too short. Health care reform is also essential, not just health insurance reform. I’m a pastor; I see end-of-life situations all the time. It has to become routine for doctors to tell their patients, “Look, I can do this and this; if I do it, the tab will be $60,000 / $120,000. Much of the tab will be passed on to your children and grandchildren. Chances are, the intervention will prolong your life two weeks / two months / two years. It’s your call.” This would lead to hospitals and doctors slashing the amount of business they do. Realistically, it needs to be slashed by 20 or 30 per cent going into the future.
Will doctors and hospitals voluntarily shrink their business? Of course not. So we are talking about reform of a deeper kind: a new social compact, in which people over the age of 65 and people in general voluntarily become thrifty about making use of the benefits they are entitled to, so as not to mortgage the future of their children and grandchildren.
Furthermore, a number of things we all pay for on behalf of others if we are part of the same insurance pool need to be paid for by the individuals who want them. This applies not only to abortions but to Viagra and sex changes.
The prison business (it is a very big business) also needs to be reformed. Total expenditures in this area need to be frozen and therefore (due to inflation and other factors) gradually shrunk. SSI payments (another out-of-control entitlement) need to be revised so that, once again, total expenditures are frozen and gradually shrunk. A significant number of military bases are redundant and need to be closed. Rumsfeld was right about this.
A cross-section of responsible Republicans and Democrats might tackle the problems referred to, when neither party has overwhelming control and with the help of a first-rate community organizer. That will be the current President. Or not.