31 Dec 2013

Krugman Once Again (Unwittingly) Confirms What the Critics Warned of ObamaCare

Health Legislation, Krugman 27 Comments

Unfortunately I can’t find it now, but at some point in 2013 Krugman was making the argument that deep down, Republicans knew ObamaCare would actually be a good thing, and that’s why they were fighting it tooth-and-nail before implementation. For if ObamaCare actually were a disaster, Krugman continued, then it would be plain as day and Republicans would score a major political victory repealing it.

Well, we can all see how silly that particular argument is. What’s interesting is that Krugman himself knows it doesn’t work. I’ve linked to him letting the cat out of the bag before, but look at his latest, where he’s even more blunt:

Perceptions about health reform are in an interesting place. Just about everyone on the right is still living in October…and is waiting to move in for the kill after the whole thing collapses. Meanwhile, a funny thing has been happening: enrollments surged this month, to such an extent that the original expectation of 7 million people signed up via the exchanges by the end of March no longer looks crazy.

OK, the usual caveats: we don’t know how many of the people signing up via the exchanges are replacing existing policies, and we don’t know how much trouble there will be when people start trying to use their new insurance. On the other hand, we know that there are a substantial number of people buying ACA-compliant policies directly from insurers, who don’t show up in the numbers yet.

And while 7 million has become the number to match or beat, the truth is that it doesn’t matter too much if “only” 6 million sign up via the exchanges, plus millions more who are signed up under expanded Medicaid. Even a slightly disappointing first year will still offer enough people benefits to make reform politically irreversible.

At this point, we have more than 2 million signed up via the exchanges and more than 4 million added to Medicaid. Both numbers will grow a lot over the next three months. This is pretty close to the end game. [Bold added.]

Notice what Krugman needs for “end game”: Just several million people to start getting benefits from the government. Yep, that’s exactly what (most) of the critics of ObamaCare said: Once you start giving federal subsidies to millions of people, that will create a politically unstoppable interest group who will prevent repeal. It’s like with Social Security or (for that matter) Medicare: It doesn’t matter how much damage the programs do to the country as a whole, once they are up and running, it’s impossible politically to get rid of them.

In case you think I’m exaggerating, look closely at Krugman’s caveats: The only things he mentions are that maybe we’re miscounting the number of people who are getting insurance who didn’t have it before (since some of the gross numbers are just replacements of old policies), or that there could be a logistical snag in actually using a new policy. (For example, maybe you need surgery but the hospital and the government computers can’t agree on who you are.)

But nowhere does Krugman mention:

(A) “Supposing that the ACA doesn’t drive up premiums so much that people are outraged…”

(B) “Supposing that the institution of death panels doesn’t horrify too many Americans…”

(C) “Supposing that the increase in wait times for MRIs doesn’t annoy enough voters…”

etc. In other words, Krugman doesn’t mention any of the things that might actually show how awful ObamaCare is, for the country as a whole. On the contrary, Krugman says–and I agree with him–that the only real consideration is to get millions of new people dependent on the government for their health insurance. Then it’s game over.

Ironically, the healthcare.gov debacle was arguably good for ObamaCare, though awful for Obama. It reduced the bar so low that critics were hoping, “Hey, the feds are so freaking incompetent, maybe they won’t even be able to technically implement this thing!” while proponents were saying, “Let’s just hope we can sign people up, let’s just hope we can sign people up, let’s just hope we can sign people up.” At this point, if one guy gets stitches in 2014 under ObamaCare, Krugman’s going to do a dance in the endzone.

27 Responses to “Krugman Once Again (Unwittingly) Confirms What the Critics Warned of ObamaCare”

  1. anon says:

    Just fyi, when I view this in feedly on android, the italics don’t close out, so everything you wrote at the end seems like an insightful comment from Krugman about himself. Also, thiscommentboxisn’trecognizedasanormaltextbox, somyphonedoesn’tautomaticallyaddspaceswhenItype.

    • Bob Murphy says:

      Sorry for that, but not sure what to say. I did close the italics, and it shows up fine in my browser.

      • Orlando says:

        It seems to be your RSS. It happens on feedly for me, too – and it happened when Google Reader was up and running. But only on CBRPM.

  2. Lee Waaks says:

    I think Krugman, like most social democrats, is ignorant about the ill effects of the welfare state overall. As he conceives it, all problems are merely short-term and can be fixed long-term. It will all come out in the wash. The most important objective is “human welfare” (as determined by an elite) under a bureaucratically-managed welfare state. That’s why it’s so hard to score big points on singular issues like the ACA.

    • Bob Murphy says:

      Wait a minute Lee Waaks, didn’t you get mad yesterday when MF tried to psychoanalyze Krugman? 🙂

      • Major_Freedom says:

        I showed him it’s OK to be a douche, 🙂

  3. Gamble says:

    “in 2013 Krugman was making the argument that deep down, Republicans knew ObamaCare would actually be a good thing”

    This is the problem. Many Republicans do think Obamacare and other socialist movements are a good thing.

    There is not 2 party’s. Most Pups are Demlight. If you strip away the veneer of the Republican party, rugged individualist are few and far between. Look no further than the Weeper of the House…

    • Bob Murphy says:

      Gamble, OK right, to avoid confusion: I agree the Republicans deep down don’t want to repeal ObamaCare. If they had, they wouldn’t have nominated the single least credible Republican on planet Earth to run against Obama on this issue.

      But I’m just saying that Krugman’s argument is absurd; no matter how bad ObamaCare is, it won’t be repealed, for the very reason he gives.

      • Major_Freedom says:

        Guys, you do realize that not a single Republican in the Senate voted against Obamacare, right?

        • Major_Freedom says:

          Sorry, meant to say not a single Reblublican in the Senate voted FOR Obamacare.

          • Bob Murphy says:

            Right, and we still have ObamaCare. So that shows Republicans are willing to put on a show that they are against something, when it won’t stop it.

            MF I’m not saying John Boehner deep down loves ObamaCare. I’m saying I don’t believe their railing against “socialized medicine” and I don’t think they will really try to repeal it.

            • Major_Freedom says:

              Yeah my bad.

              I put far too much weight on voting, and forgot that voting is a lot of times just for the sake of appearances, and not a revelation of their actual convictions.

  4. kay w says:

    the fact is, the incentives to show up at the ER for trifles are still in place.

    also, people who are short-term unemployed or who have been out of the career loop (such as taking care of parents fulltime like myself) are being stuffed into the “medicaid/medical” category. no thanks, i’ll stick with my medical provider professional group policy that was cancelled and replaced by a more expensive inidiual policy with less coverage. great job in top down “planning” as always.

  5. Bob Roddis says:

    The only reason Obamacare would be repealed is due to the individual expense across the board to voters. I am personally familiar with a 55 year old with cancer who makes $9.50 an hour and about $20,000 a year after lots of overtime. He never bothered to be covered before. His new premium is $180 a month after subsidies.

    Obamacare may be abolished because people are used to getting freebies and this isn’t it. With the market destroyed, we will then just go full Soviet in the health care field.

    • Major_Freedom says:

      The Soviets didn’t have anything close to the level of sophistication in spying and armored tank riding police offers that we do, to keep the population in check while US healthcare goes Soviet.

    • Matt M. (Dude Where's My Freedom) says:

      This is very true. I have many liberal family members who are outraged at Obamacare because they thought Obama was promising them FREE health care, but when they go to sign up, they look at plans that have monthly premiums AND deductibles AND co-pays. These are people who are dirt poor and have been living paycheck to paycheck with no insurance previously. To them, Obamacare is nothing more than a law forcing them to pay more money than they did previously.

    • kay w says:

      that’s right, about $16969 (or something like that depending on state and age) is the magic number minimum annual pretax income in order to not drop into medicaid (which is a nightmare of substandard care) and instead, have subsidies kick in.

  6. Matt M. (Dude Where's My Freedom) says:

    “OK, the usual caveats: we don’t know how many of the people signing up via the exchanges are replacing existing policies”

    Couldn’t we easily find this out with basic math? We know how many policies were cancelled (don’t we?). We know that it’s now legally required to get coverage. If people don’t get coverage, presumably the IRS will be able to tell us how many fines it issued (although for political reasons, they probably won’t want to). Can’t we just look at the numbers and say “10 million lost coverage, 20 million signed up, IRS issued 5 million fines, therefore only 5 million new people signed up”?

  7. Bob Roddis says:

    Among the hardest hit is Neal Campbell a salesman with a wife and three young children, all of whom are active in athletics. The premium payments currently deducted weekly from his paycheck will increase $77, to a total of $221 PER WEEK. “That’s a huge part of the budget,” he said. “We feel betrayed, lied to, and we’re pissed off.”


  8. @ZeevKidron says:

    Krugman writing in Pravda On The Hudson may have his ides about inevitability and I’m sure politicians from both sides will throw endless money and effort on O’Care in an effort to make it work. But I am not so sure about the final results. There is one essential aspect of socialized medicine which I’m not so sure Americans will swallow.

    The simple fact is if medicine is to be socialized than private practice of medicine must be abolished. Are Americans ready for all private hospitals shutting down and all doctors becoming State employees, by force?

  9. John says:

    I think I understand the criticisms being leveled at Krugman and Obamacare here. There are, however, 30 or 40 million Americans who have no health insurance and for whom a health care emergency often represents the beginning of financial ruin. Conceptually, how would a perfect free market cope with this problem? Or are my premises wrong, in that it may not be considered a problem?

  10. Sam says:

    It’s not so much that the free market can magically make that problem go away, it’s that the coercive methods of the ACA actually make it worse. It’s important to consider that a substantial portion of those 30 to 40 million were voluntarily uninsured, otherwise, what would be the meaning of the individual mandate? There’s a portion of those people who would like to have insurance but can’t afford it, but a majority for whom the cost/benefit analysis simply doesn’t make sense, especially for the young men who don’t wear helmets either. What forcing people to buy insurance does is takes away a major part of the restraint which existed on increasing premiums; in 2013 the insurance companies had to worry about keeping their prices attractive to consumers, in 2014 they don’t. The cost of my insurance policy more than doubles, and I opt out, joining the 30 to 40 million, because under the ACA, the financial ruin doesn’t wait for a health crisis to actually occur; the financial ruin begins immediately, when your net pay is slashed even though you’re healthy.

    The biggest answer that the Free Market has to your question is that under a truly Free Market, or even a freer market, total costs for actual care would be radically lower, because the regulatory monopolies that keep the number of care providers small would not be enforced, the small pipeline of medical training would be expanded, and because the vast portion of the costs of providing healthcare which is represented by lawsuits and malpractice insurance and “reasonable attorney’s fees,” would not have reached the astronomical proportions it has. With much lower total expenditures on health care, any given treatment would be less expensive directly to the consumer, or any given insurance policy could be much less costly to maintain because it would essentially be insuring against a lower dollar value of risk.

    All subsidy ultimately increases costs. If you can afford to pay $10 for something, and the government runs up and offers to pay another $10, how long before the seller realizes he can ask $20 for it without losing any sales? How long before premiums rise to absorb the full value of the subsidies, and treatment costs rise to absorb the full increase in coverage? It is extremely likely that in a few years the public will be no closer to security against health care costs than they are today, because this effort has been only an attempt socialize and share a cost that is fully capable of further rise. Those who have been subsidized will see their prices increase to meet the subsidy, and those who have been forced to subsidize will have gained nothing. All that will have been achieved is the enrichment of some at the expense of others, and some politicians will have secured for themselves some votes.

    • Matt M (Dude Where's My Freedom) says:

      “There’s a portion of those people who would like to have insurance but can’t afford it, but a majority for whom the cost/benefit analysis simply doesn’t make sense”

      Is this really so different?

      Right now, I’m not making significantly above minimum wage. I’d love to buy a new car. Technically speaking, I can “afford” it in the sense that I have the available funds to make a down payment and could theoretically finance the rest. But since that would eat up a large portion of my salary, I choose not to, because the cost/benefit analysis doesn’t make sense.

      • Sam says:

        You stated the difference pretty clearly there; the distinction between being unable to purchase a good without making sacrifices we don’t want to make (your case with the financed car) vs. being unable to purchase it regardless of how we allocate our spending power, because it is so far out of reach that it either exceeds our income our exceeds our income minus the cost of bare survival.

        The latter case is those (among the uninsured) were hoped to be helped by the ACA, the former would only be helped if the net cost of health insurance and care went down, which is the opposite of the case so far. Simply getting them insured, when they didn’t want to be insured on those terms, has been an obvious detriment to those for whom the cost benefit analysis didn’t make sense, because it still doesn’t make sense, they’re now just being hit with the individual mandate to buy something they chose not to buy before.

        What I’m getting at is that the justification for the ACA always came from looking at the people so poor or sick that they had no hope of being able to get health insurance. The error is to use the 30 to 40 million uninsured statistic as if it were a reflection of the size of this group. It’s like saying millions of people in this country face hunger, while some crazy diet craze is in effect and lots of people are voluntarily starving themselves. It’s different enough that the “This is a desperate case!” defense of the ACA is undermined merely by distinguishing between the desperate and those who would simply rather spend their money on something else.

        • Matt M (Dude Where's My Freedom) says:

          I would suggest to you that the amount of people in the United States who couldn’t afford health insurance *no matter what other sacrifices they might make* is so minuscule as to be irrelevant.

          Anyone whose not homeless probably *could* afford health insurance, if they sacrificed other things. Technically speaking you’re probably right, but in common usage, saying “I can’t afford X” is the same thing as saying “I’m uncomfortable with the sacrifices I would have to make in other areas in order to purchase X.”

          • Sam says:

            Well yeah, but…
            I really get the impression when I hear people defending welfare state programs that what they’re thinking of is the the kind of poverty that prevents people from affording things *regardless* of sacrifice, or at least excluding from sacrifice-able expenses subsistence food and slum rent. They’re trying to justify confiscation, after all; their whole rhetorical case is based on really desperate need. So yeah in commerce, you’re right, “I can’t afford it,” means it’s a lower priority than other expenditures. But in political ads “Those who can’t afford health insurance,” only tugs at the heartstrings if it means literal destitution, not if those people could get health insurance if they just cut back on some discretionary spending. If the liberals really think the poor need socialized medicine because they can’t afford it in the commercial sense you’re talking about, then what they’re saying is that the public needs to take on the burden *not* of protecting the health of the poor, but of paying for the lowest-priority luxuries that the poor would have to give up in order to voluntarily purchase health insurance. And that’d be a pretty LOL position.

            For the record, the notion that the kind of poverty that has to choose between basic survival needs and health care is rare…boy would you be in a huge fight saying that in some crowds. I think it is rare, which is why the left uses this kind of misleading statistic to overestimate its prevalence, but it will never be irrelevant. As long as the left can successfully paint us as Scrooge, they have a political leg to stand on, even as their policies exacerbate the fate of those they pretend to aid.

  11. Cosmo Kramer says:

    If I could write a law that was meant to please no one, this is the one I would write.

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