I received the following comment from Dr. Graboyes of the NFIB to my reply to his comments from my original post about their 10 healthcare principles. I would welcome your thoughts on this debate! Has the NFIB become part of the problem or am I being too idealistic and naive?
I believe Dr. Cornwall unintentionally validates my arguments rather than his own in that: (1) the "pragmatic" actions he describes are polar opposites of NFIB's current efforts; (2) the Cato Institute does not advocate a total retreat of government from health care; and (3) the solutions Dr. Cornwall offers are not solutions.
(1) In the 1940s, employer-sponsored health insurance arose from the private sector, not from the government. Private firms offered health insurance to circumvent the suffocating effects of wage-price controls.
The firms had found a loophole in the law, and federal government's role was to acquiesce, not to innovate. In the 1970s, the low-deductible policies Prof. Cornwall laments were private sector responses to Nixon-era public policies. In both cases, bad public policies led private firms to pursue problematic responses. NFIB's current strategy is to do the opposite: we want good public policies that lead private firms to take constructive actions.
(2) The Cato Institute is, as Prof. Cornwall notes, "about as market-oriented as they come." No doubt, NFIB's positions on health care reform will not be entirely to Cato's liking. But, contrary to Prof.
Cornwall's claim, even Cato doesn't advocate a total retreat of government from health care. In "Sinking SCHIP: A First Step toward Stopping the Growth of Government Health Programs," Michael Cannon urges health care deregulation "thereby allowing government health programs to focus on those patients who most need assistance." That sounds like reducing government's role, not eliminating it. In "Crisis of Abundance," Cato scholar Arnold Kling offers a market-oriented plan that cuts the government's proportion of health care spending, but does not eliminate it. (I reviewed the book favorably at:
http://www.nabe.com/publib/be/0704/reviews.html) As long as government has some role in the mix, distortions will be present, and second-best solutions will be inevitable. The tough part of the debate is figuring out what that second-best is and not settling for less. It is there that free-market proponents will disagree.
(3) My previous posting asked Prof. Cornwall "[W]hat proposals would you take to Congress and the state legislatures? We're looking for specifics, and we'd be glad to listen." His response was: "Give the consumers control of their health care dollars. Remove the employer from the health care system. What a way to truly put small business on a level playing field with big corporations. Tear down government barriers to a truly free health care system - deregulate health care. ... We can reform Medicaid like we reformed federal welfare. Shift that money back to the state in block grants free of federal mandates. We can deregulate health care just as we deregulated so many other powerful industries during the Reagan era."
Good, thought-provoking ideas. But they're bumper stickers, not specifics. Let me suggest an experiment: Put the above suggestions in a letter on university stationery. Send a copy to each of the 535 members of Congress and 7,000+ state legislators. Ask each recipient for a mere 30 minutes of time to discuss the ideas. Now calculate two variables: X = the number of "thank you for your interest" letters signed by legislative interns and Y = the number of legislators willing to meet with you. My guess is that X will be at least 100 times Y.
When I'm a college professor, I can advocate any fantasy health care system my imagination desires. NFIB doesn't have that luxury. NFIB represents 350,000 member firms, their employees, and the larger community of small businesses. Sweeping philosophical declarations won't protect their livelihoods. Prof. Cornwall says: "Don't tell me that such fundamental change is not pragmatic or realistic." Well, sometimes we have to tell you that; NFIB can't demand all or nothing. We have to remember Voltaire's, "The perfect is the enemy of the good."
On the other hand, it's tempting to let pragmatism to turn to sloth and timidity. So Prof. Cornwall and others like him do a great public service by pushing us to achieve as much as we can and not settle for less than what is possible. Thanks to him for his advice and willingness to talk.
