Just Not Getting the Concept

It’s endemic to home repair and to car repair – you try to fix it yourself and you only make matters worse. As a general rule, well, don’t work on the plumbing, and certainly don’t work on the electrical stuff. Beyond pouring in the Drain-O or changing the light bulb it’s best to call in a professional, or someone who at least claims to be one. They’ve done this sort of thing before and not only know what can go wrong, but they do have a firm grasp of the concept involved in what they’re trying to do. One thing can lead to another if you’re not paying attention. Often what you think is the problem isn’t the problem at all. And as for the car, no, you cannot do that brake job yourself, with a few parts from Pep Boys and the enclosed instruction sheet. There are a lot of interrelated gizmos, as one thing is always connected to another. Heck, these days even changing the wiper blades can be tricky. The turn signals might stop working.

Most adult males know this of course – or they learn it sooner or later. When someone says it’s an easy fix they know it never is. And they stopped lying to themselves long ago. How hard can it be? They’ve discovered just how hard it can be, over and over, painfully. You don’t buck yourself up saying those words to yourself. You make the call. The wife may think you’re a useless all-thumbs coward, but it’s better than having the toilet explode. She will not be impressed with that. So here’s the rule. Don’t try this at home, just like it says in the commercials.

All this is pretty obvious, at least to fully-functioning adults. Only goofy teenagers believe it when someone says heck, it’s an easy fix. And then there are politicians, who win office by saying heck, it’s an easy fix – just bomb Iran, or lower taxes on the rich, or fire all the teachers and make unions illegal, or screw the damned Chinese by putting massive tariffs on all they try to sell here. But it’s never that simple. One thing is always connected to another.

It’s just that you cannot say that and get elected to office. People do want to hear there is one quick easy fix to whatever the problem, and of course they’ll vote for anyone who says there is. It’s comforting to hear that, even if it does turn most politicians into little more than goofy quick-fix teenagers. Obama seems to be the only modern politician who survived his habit of reminding everyone things are not as simple as they seem – but maybe he won the presidency because most people who voted for him gave him a pass on that, as they muttered Yes We Can and bought another one of the Shepard Fairey “Hope” posters. He did keep saying, over and over, that things were complicated, and so much in the world is oddly interrelated and we ought to pay attention to that. But enough people just didn’t pay attention that sort of thing – it was boring. They liked him anyway. Obama lucked out.

But all this is playing out in the current hullabaloo about Medicare. The Republicans are saying it’s simple, really – save the system by turning it into a voucher program and let the elderly shop for insurance on the open market, as the market is always right, as market competition produces the best stuff at the lowest cost, as big corporations vie with each other to see who can grab the most customers with the best and lowest cost product. You see, it’s that simple. And the Democrats say the damned program is working just fine – all we need to do is tweak it to lower costs and have the absurdly rich chip in just a bit more to keep it solvent. Choose your oversimplified poison.

But one need to look at the concept here, and in this item – How To Make the Medicare Problem Worse – Steve Benen examines the disconnect between the problem and proposed “solution” on the Republican side:

The standard Republican line is that Medicare faces a serious financial shortfall in the future, with escalating costs threatening its viability. To deal with the problem, Republicans are pushing a plan that doesn’t deal with escalating costs at all.

Indeed, what’s often overlooked is the fact that the GOP plan to “save” money through Medicare “reform” actually costs more.

Well, it does:

The Republican plan, as crafted by Paul Ryan, is to scrap Medicare and replace it with a privatized voucher plan. The voucher decreases in value over time, which produces “savings” for the government, not by controlling costs or addressing care delivery systems, but by transferring costs to you. And if the voucher doesn’t cover what you need, well, good luck.

For the GOP, this ruthlessness is just a fiscal necessity. The nation can’t afford Medicare anymore, so these “reforms” are unavoidable.

Benen points out that this is absurd on its face, as Republicans, as they state explicitly in the Ryan budget they all support, intend to spend the difference on tax cuts, not debt reduction. This is not about saving money to stabilize and save the system. The money saved, if any, goes to the rich. And in fact, this will make medical care more expensive generally, and more expensive specifically, for the elderly, as Peter Orszag explains here:

While more consumer cost-sharing would help reduce unnecessary care, the plan would not live up to its billing in cutting health costs for America. According to the nonpartisan Congressional Budget Office, it would do the opposite. That’s right: The CBO found that the Ryan Medicare proposal would substantially increase total health-care spending. …

On the critical metric of whether the Ryan plan would reduce total health-care costs, though, the CBO conclusion is shocking: The plan would not only fail to decrease health-care costs per beneficiary, it would increase them – by an astonishingly large amount that grows over time. By 2030, health spending on the typical beneficiary would be more than 40 percent higher under the Ryan plan than under existing Medicare, according to the CBO report.

Health-care costs would not be reduced on the backs of seniors; they would be raised on the backs of seniors.

Private insurance, with its ten to twelve percent administrative overhead, does cost more than Medicare, with its two or three percent overhead. The product is more expensive and the government will pay for less and less of it.

Benen comments:

I can appreciate why this sounds ridiculous. The Republican plan to reduce the debt doesn’t really reduce the debt? The Republican plan to reduce health care costs increases health care costs? The Republican plan to save Medicare actually eliminates Medicare? Actually, yes – none of this criticism is in any way hyperbolic.

He has the notion that the point of Medicare “reform” is of course the system cost less, not more:

The plan pushed by the GOP in the House and Senate makes the system cost more, only in this scenario, it’s seniors on a fixed income who’ll bear the increased burden. This, they assure us, is an example of fiscal responsibility.

It’s as if the whole party is taking crazy pills.

Media professionals who genuinely believe the Paul Ryan agenda is courageous and sensible haven’t taken the time to do their homework. It’s snake oil in a medicinal bottle.

Yeah, yeah – but at least it’s a plan. And the Democrats don’t even have one.

But Benen notes that the Democrats actually do have a plan to reduce Medicare costs, to restrain the growth of Medicare spending. It’s called the Independent Payment Advisory Board, and it’s likely to be quite effective in curtailing spending on ineffective health care treatments, as Matthew Yglesias explains:

There are currently two approaches to restraining the growth of Medicare spending in Washington. One, espoused by the Obama administration, is to create an Independent Payment Advisory Board which will prevent Medicare from paying for ineffective health care treatments. The other, espoused by House Republicans, is to do nothing whatsoever for the next ten years. And then to promise that nothing will ever be done to harm a precious hair on the head of a single precious person born in the good old days before 1955.

But what if you were born after 1955? Then it’s simple – no Medicare for you. You get a coupon, of decreasing value, to go buy private health insurance.

Sometimes conservative pundits claim to believe that the problem with the IPAB approach is that it can’t be made to work. Other times conservative politicians dedicate themselves to fanatical defense of wasteful Medicare spending, denouncing IPAB as Kenyan socialist rationing.

And Brian Beutler reports that they have a powerful tool to make sure any sort of Independent Payment Advisory Board fails – just don’t confirm anyone:

There’s just one problem: Each of the board’s 15 members has to be confirmed by the Senate. That means filibusters and 60 vote requirements stand in the way of staffing a panel that Republicans decry as a government rationing board. And months ahead of the nominations, they’re telling Obama “good luck with that!”

“I think it would be pretty tough,” Sen. Orrin Hatch (R-UT), the top Republican on the powerful Senate Finance Committee, told Talking Points Memo Monday, when asked about confirming Obama’s nominees to IPAB. “We don’t believe in rationing, nor do we believe in an unaccountable organization like that. I mean that’s crazy.”

“I’d have to think about that. If it were changed, then probably, but the way it’s constituted now, it’d be difficult,” Sen. Tom Coburn (R-OK), an influential conservative in the Republican caucus, said Monday in response to a question from TPM.


Then once this effort to increase the cost-effectiveness of Medicare for all Americans is sabotaged, the success of the sabotage will become an argument in favor of scrapping Medicare altogether.


Republicans, who claim to be obsessed with Medicare financing, are against it, and are eager to kill the idea. It’s been that kind of debate.

And as for those cost tables – the cost of Medicare will rise forty percent if the Republicans have their way, and Yglesias adds this:

Now of course at some point in the further future, the Ryancare vouchers will be so stingy that out of pocket costs will be so high that middle class seniors genuinely can’t afford them (especially since Medicaid will have been previously gutted) at which point inability to pay will become some kind of binding constraint on total spending.

But in the real world, the combined political clout of the elderly, healthcare providers and health insurance companies is going to prevent this from happening. The cost of the subsidies to insurance companies will have to bear some relationship to the price of health care services and it’ll be adjusted upward. Patients will spend dramatically more out of pocket, taxpayers will see few if any savings, health care providers will be able to charge higher prices, and insurance companies will make a tidy profit skimming off the top.

And that’s a solution? Someone is unclear on the concept here. And as Jared Bernstein said – “Just because Rep. Paul Ryan keeps saying it doesn’t make it any less egregiously wrong.”

To get why this “market solution” can’t work, you have to understand a bit about how Ryan’s plan changes Medicare. As is by now pretty widely appreciated, including by many in his own party, the plan ends guaranteed health care coverage for seniors and replaces it with a voucher for them to shop for insurance on the street.

Importantly, the value of those vouchers start well below where they need to be to enable seniors to afford coverage comparable to Medicare today (in fact, beneficiaries costs would have to double), and their value falls increasing behind coverage costs over time.

Suppose you send me to the grocery store to buy you a gallon of milk. Milk costs $3.50 a gallon but you give me $2. I spend the whole day “denying business to inefficient providers” – i.e., grocers who all charge more than that – and at the end of the day, bring you back a pint.

Now, instead of milk, where I’ve got the information I need to be a smart shopper, suppose you give me the same under-priced voucher but ask me to bring you back a plan for treating that strange pain you’ve been experience on your left side on humid days.

There’s no “denying business to inefficient providers” in the Ryan plan because there’s no market discipline that average folks with incomplete information armed with an inadequate voucher can enforce on a private health insurance market that’s … well, different.

And what was the point here, originally? What were you trying to fix? Yep, replace the wiper blades and the turn signals stop working.

And, also from Steve Benen, see McConnell Puts Medicare in the Ransom Note:

The Republican debt-ceiling strategy hasn’t been subtle: GOP officials are threatening to cause a recession, on purpose, unless Democrats give them the spending cuts they want. It’s Hostage Taking 101.

The trick has been identifying the ransom. Republicans have said they expect “something big” in exchange for doing what they obviously have to do anyway, but they’ve been vague about the details. “Meet our demands or we’ll kill the hostage.” What are your demands? “We’re not sure; why don’t you offer something and we’ll get back to you.”

In recent weeks, the details have gotten a little clearer, with House Speaker John Boehner (R-Ohio) saying he expects $2 trillion in cuts or he’ll deliberately cause an economic catastrophe. But even that’s too vague – no one knows where the $2 trillion should come from or over how long.

But now Senate Minority Leader Mitch McConnell went much further in clarifying what’s on the ransom note:

In a Capitol briefing with reporters Friday, McConnell declared affirmatively that unspecified Medicare cuts are on the table in bipartisan debt limit negotiations, led by Vice President Joe Biden, and he expects they’ll be part of the final deal. But in response to a question from TPM, he went further than he has in the past in laying down a marker on that issue. Medicare cuts must be part of that deal to get his support, he says – even if negotiators manage to find trillions of dollars in savings elsewhere, even if his other priorities are met.

“To get my vote, for me, it’s going to take short term [cuts, via spending caps]… Both medium and long-term, entitlements,” McConnell said. “Medicare will be part of the solution.”

To clarify, I asked “If the Biden group comes up with big cuts, trillions of dollars worth of cuts, but without substantially addressing Medicare, it won’t get your vote?”

“Correct,” McConnell said.


This is no small admission. The Senate’s leading Republican is saying, publicly and on the record, that without Medicare cuts, he’ll try to create an economic calamity on purpose.

The obvious question, at this point, is what kind of cuts McConnell has in mind, and whether (and how much) it would affect benefits for the elderly. Maybe the Senate Minority Leader doesn’t have the policy chops to talk about his ideas for reductions in any depth, or maybe he’s just saving it for the negotiating table.

Either way, it’s a fairly big deal. In fact, now that McConnell has admitted it, Democrats should probably let the public know. The talking point isn’t complicated: Senate Republicans will create a recession unless Democrats agree to Medicare cuts.

Maybe part of letting the public know is to be clear on the concept – we all chip in so that the elderly, whoever they are, don’t die in poverty, and from quite treatable illnesses. We don’t raise the cost of their contribution to this by forty percent and tell them to jump on the grandkid’s computer and shop around for anyone, anywhere, who might agree to insure them – and then just walk away. We take care of our fellow citizens, and especially the elderly. And so that we don’t get hammered by the cost of doing that, we establish best procedures and practices, listing what works and what doesn’t, to weed out the nonsense to start to make this whole thing less expensive.

Is that such a hard concept? Apparently it is. But really, you just don’t let amateurs fix things. Sometimes the toilet explodes.

About Alan

The editor is a former systems manager for a large California-based HMO, and a former senior systems manager for Northrop, Hughes-Raytheon, Computer Sciences Corporation, Perot Systems and other such organizations. One position was managing the financial and payroll systems for a large hospital chain. And somewhere in there was a two-year stint in Canada running the systems shop at a General Motors locomotive factory - in London, Ontario. That explains Canadian matters scattered through these pages. Otherwise, think large-scale HR, payroll, financial and manufacturing systems. A résumé is available if you wish. The editor has a graduate degree in Eighteenth-Century British Literature from Duke University where he was a National Woodrow Wilson Fellow, and taught English and music in upstate New York in the seventies, and then in the early eighties moved to California and left teaching. The editor currently resides in Hollywood California, a block north of the Sunset Strip.
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