Monday, October 21, 2013

Future and the Affordable Care Act

"If you put the federal government in charge of the Sahara Desert, in five years there'd be a shortage of sand." ― Milton Friedman
The failures of the website were easier to predict than Alex Rodriguez using performance enhancing drugs. After 3 weeks of system failures, the Democratic apologists are out in full force. They have a unified message and they are sticking to it. It has four parts:
  1. Admit that the initial release of has its problems.
  2. Insist the problems will get fixed so there's nothing to worry about.
  3. Justify #2 by saying that several of the state exchanges work "just fine" and that fact will translate to the federal health insurance system working fine as well.
  4. These technical problems have nothing to do with the law. The Affordable Care Act is still a good law.
All of these excuses mask the real problem. In my opinion, the federal government has never successfully implemented and maintained an effective and efficient social program in the history of this Republic. Not one. There are and were dramatic flaws with every social problem ever implemented by the federal government. So much so that the three major ones - Social Security, Medicare and Medicaid are all functionally insolvent.

I don't want to get bogged down in a discussion of those three programs, but I do need to provide some context. As the Trustees of the Social Security and Medicare trust funds report says, "Neither Medicare nor Social Security can sustain projected long-run programs in full under currently scheduled financing." In addition, there is no actual money in the trust funds for those programs. As noted during the Clinton administration 13 years ago in 2000 in the FY 2000 Budget, Analytical Perspectives p. 337:
"These balances are available to finance future benefit payments and other trust fund expenditures — but only in a bookkeeping sense. These funds are not set up to be pension funds, like the funds of private pension plans. They do not consist of real economic assets that can be drawn down in the future to fund benefits. Instead, they are claims on the Treasury that, when redeemed, will have to be financed by raising taxes, borrowing from the public, or reducing benefits or other expenditures. (emphasis added)"
Medicaid doesn't even have a trust fund and has always been functionally insolvent, requiring greater and greater government borrowing to finance its expenditures each year. This is a major reason why the states don't want to expand their Medicaid rolls, because they know after 2019 they will be on the hook. Despite what Paul Krugman says, that additional cost would not be "trivial."

Other failed government social programs include Affirmative Action, Welfare, TANF, Unemployment Insurance and the war on drugs. Sure, they are popular. But an anti-poverty program of giving away $100,000 to every U.S. citizen with at least a high school degree would be an overwhelmingly popular program as well. That doesn't mean it would work.

And therein lays the problem. Because it doesn't matter if the or the Affordable Care Act ever works. They are subject to be judged by their intentions rather than their results as are all liberal programs. Eventually, the perception of these programs doing good obscures the reality of their failure.

As I said in a previous post, modern liberalism isn't just a set of political ideals; it's a religion as powerful as Christianity, Judaism and Islam. The faithful will always believe that their programs work until they don't. When they don't they will blame the infidels, in this case conservative Republicans. In fact, in the coming weeks, watch for the blame game to start. Despite the tiny $93 million cost for this software project (in government terms) Democrats will blame a lack of funding and Republican obstruction. By the way, it's rare that a software development project's projected size is accurate. It's likely twice that and maybe more given the errors.

Also, look for this meme: if only we had gone to single payer by expanding Medicare this wouldn't have been a problem. This is of course the ultimate goal of ObamaCare; Total government control of the health care and health insurance industries.

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