Meet the New Harry and Louise

Vox’s attack on Bernie Sanders is sold as a policy critique. It’s actually a dishonest exercise in managing the Democratic Party base.

Bernie Sanders speaks at a June 2015 rally celebrating the fiftieth anniversary of Medicare's passage. National Nurses United / Flickr

Way back in the early months of the 2008 Democratic nomination battle, the online hive of liberal wonkery was abuzz with controversy.

The health care plans announced by the Clinton and (especially) Obama campaigns had come under fire for being short on specifics and vague about key issues. The controversy was dominating the campaign news cycle, and now liberal pundits were split.

One side (including Paul Krugman and the New Republic’s Jonathan Cohn) saw the sparse details and general vagueness of Obama’s proposals (and, to a lesser extent, Clinton’s) as a serious problem that reflected poorly on the candidates.

But one prominent wonk demurred — Matt Yglesias:

Implicit in the pro-details side of things seems to be a kind of mandate literalism about the American legislative process. The idea is that if a candidate has a proposal on the table, runs on the proposal, gets attacked on the proposal, and then wins the election anyway that this makes it much more likely that congress will actually pass the proposal.

That makes a ton of logical sense. But is it historically accurate?

Yglesias was dubious, and his skepticism of the whole “pro-details” position on health care soon became something of a leitmotif for him.

“In terms of specific details,” he wrote in another post, “neither campaign has released much in the way of specific details. And what’s more, everyone acknowledges that any specific details the campaigns might release will likely be changed during the legislative process anyway. So what’s the deal?”

For Yglesias, the really important thing about a candidate’s health care plan was the broad principles that underpinned it, not its accumulation of details. That was the lesson he took away when a DC policy magazine asked a panel of experts to issue detailed scorecards for the various health care plans of all the Democratic and Republican candidates.

Reviewing the scorecards, Yglesias concluded:

That the [two parties’] plans differ in these systematic ways probably gives you a better idea of who to vote for than would any amount of peering into the details of the plans. All of these proposals are vague in some key respects, and nothing that’s proposed on the campaign trail is going to be enacted as is by congress. But these plans show something about the values and priorities of the different parties. Republicans, basically, are looking to make sure that the federal budget contains as much headroom as possible for tax cuts for high-income and high-wealth individuals while minimizing financial burdens on large employers. Democrats, by contrast, are looking to improve the quality and accessibility of American health care.

The lesson for Yglesias that day (as on many other days) was that when it came to principles, the Democrats had the better of the argument. As for details, they weren’t so important.

The Acupuncture Crisis

It seems Yglesias has changed his mind.

Now that it’s Bernie Sanders who’s offering a major health care reform plan, Yglesias wants to hear specifics. In fact, the sheer exhaustiveness of the specifics he wants to hear is pretty extraordinary. “Is abortion covered? Is acupuncture? What if there are shortages of medical equipment? What if a doctor wants to prescribe a course of treatment that’s not supported by science? Sanders has nothing to say about any of this.”

And it’s not just his mind that’s changed, it’s his tone. Gone is the usual air of amused detachment; instead, he works himself up to an exasperated pitch, like the policy writer’s version of a man yelling at his TV. “His big, bold ideas — though a valuable contribution to the debate — just don’t look very much like a governing agenda or even a basis for grinding general election campaign.”

Warming to his theme, Yglesias spends a paragraph dilating on the complexities of administering Britain’s National Health Service (a different system than the one Sanders is proposing), and then after reviewing those intricate issues, complains that “Sanders’s ‘plan’ doesn’t cover any of this ground.” Worse, he says, Sanders’s “worldview” is unable even to “accommodate the questions”; for the Senator, “the only relevant issue is ‘whether we have the guts to stand up to the private insurance companies and all of their money.’”

As Yglesias moves on to Sanders’s free college tuition plan, the hunger for details becomes insatiable.

There are big questions here: What if states make this work by pushing more costs into the room and board column? What if public university systems are swamped with applicants now that they’re free? What if eliminating tuition means students start taking longer to complete their degrees? What if the underlying cost of providing a college education grows faster than the volume of Wall Street trades? What about the quality of college education?

By the time Yglesias gets to Sanders’s Wall Street reform plan, the list of missing details is too long even to itemize. He quotes the candidate: “It is clear what you have to do. Bring back the 21st Century Glass-Steagall legislation and break up these huge financial institutions.” To Yglesias, this might as well be gibberish:

What does that mean? Well, Sanders has a bill called the Too Big To Fail Too Big to Exist Act, which is a nice slogan. . . . The bill is only four pages long, and what it does is direct the Financial Stability Oversight Committee to compile a list of banks that are deemed “too big to fail” and then break them up.

This just isn’t the way bank regulators think or work. There’s no such thing as a bank that’s “too big” to fail. There are specific situations in which the failures of certain financial institutions could be gravely threatening to the stability of other financial institutions and set off a chain reaction of bank failures that devastates the economy. Sanders’s legislation offers regulators no guidance as to what criteria are supposed to be used to identify institutions that are to be broken up, and says nothing much about how the breakups are supposed to look or work.

It’s possible Yglesias hasn’t had an opportunity to read Sanders’s four-page bill, though it is online. If he gets around to it, he’ll find a paragraph that defines “too big to fail” as “any entity whose failure, due to its size, exposure to counterparties, liquidity position, interdependencies, role in critical markets, or other characteristics or factors, would have a catastrophic effect on the stability of either the financial system or the United States economy without substantial Government assistance.”

He’ll find another part stating that Too Big To Fail “shall include, but is not limited to, any United States bank holding companies that have been identified as systemically important banks by the Financial Stability Board.”

And if he really digs, he might stumble across the fact that the Federal Reserve, the largest US bank regulator, has already promulgated a rule “establishing the criteria for identifying a GSIB” (global systemically important bank), and already compiled a list of such institutions: eight giant banks, all household names. (Though obviously there’s no talk of actually breaking them up.)

Now, is the idea of breaking up big banks — as a general principle — a good idea in the first place? That might be something worth debating. Certainly Sanders isn’t the only one who thinks so. “If some banks are thought to be too big to fail,” Bank of England governor Mervyn King said in a 2009 speech, “then, in the words of a distinguished American economist, they are too big. It is not sensible to allow large banks to combine high street retail banking with risky investment banking or funding strategies, and then provide an implicit state guarantee against failure.”

Of course, the devil is in the details, as always. But this is an election campaign, where the underlying “values and priorities” of a campaign plan “[give] you a better idea of who to vote for than would any amount of peering into the details of the plans.”

At least, according to Matt Yglesias.

A Switch in Time

But apparently one Sanders takedown in Vox wasn’t enough. Ezra Klein, the website’s founder and a longtime health policy hand, felt the need to pitch in too, posting a slashing evisceration of Sanders’s single-payer health care proposal.

The flavor of Klein’s piece can be gleaned from its early paragraphs. It was pretty brutal.

[T]his is a document that lets Sanders say he has a plan, but doesn’t answer the most important questions about how his plan would work, or what it would mean for most Americans. Sanders is detailed and specific in response to the three main attacks Clinton has launched, but is vague or unrealistic on virtually every other issue. The result is that he answers Clinton’s criticisms while raising much more profound questions about his own ideas.

Sanders promises his health-care system will cover pretty much everything while costing the average American almost nothing, and he relies mainly on vague “administrative” savings and massive taxes on the rich to make up the difference. It’s everything critics fear a single-payer plan would be, and it lacks the kind of engagement with the problems of single-payer health systems necessary to win over skeptics.

Klein gives no quarter. Sanders’s plan is a “puppies-and-rainbows approach,” a “huge, disruptive reform.” “This is what Republicans fear liberals truly believe: that they can deliver expansive, unlimited benefits to the vast majority of Americans by stacking increasingly implausible, and economically harmful, taxes on the rich. Sanders is proving them right.”

As the paragraphs pile up, the conclusion becomes inescapable: health reform is serious business — full of hard choices and tough calls. And Sanders talks as if they just don’t exist.

This, obviously, is the age-old litany of the Important Beltway Pundit, a rarified station that Klein has attained at a precocious stage of his career. Yet before he became a Sunday morning-level pundit, Klein was actually known as a bright young health reform expert, writing detailed analyses and explainers on the finer points of policy.

In 2007, he published a broad-ranging and widely praised survey of the world’s health care systems in the American Prospect (Paul Krugman even put it on his class syllabus at Princeton) that did much to establish his early reputation as a policy analyst.

And back then, health reform didn’t seem quite so hard or so tough to Klein. Instead, that piece offered a far sunnier perspective. To see just how sunny, it’s worth quoting it at length:

Medicine may be hard, but health insurance is simple. The rest of the world’s industrialized nations have already figured it out, and done so without leaving 45 million of their countrymen uninsured and 16 million or so underinsured, and without letting costs spiral into the stratosphere and severely threaten their national economies.

Even better, these successes are not secret, and the mechanisms not unknown. Ask health researchers what should be done, and they will sigh and suggest something akin to what France or Germany does. Ask them what they think can be done, and their desperation to evade the opposition of the insurance industry and the pharmaceutical industry and conservatives and manufacturers and all the rest will leave them stammering out buzzwords. . . .

So let us, in these pages, shut out the political world for a moment . . . and ask, simply: What should be done? To help answer that question, we will examine the best health-care systems in the world: those of Canada, France, Great Britain, Germany, and the U.S. Veterans Health Administration (VHA).

How could Klein have felt such warmth back then for the single-payer systems of Canada or France (let alone Britain, with its socialized NHS!), while being so hostile to Bernie Sanders’s plan now, when the latter claims to draw its inspiration specifically from the former?

Based on the Vox piece, it’s a mystery. Klein’s tone of confident authority barely conceals a confused, self-contradictory, at times laughably inaccurate jumble of charges that make little sense even on its own terms.

Losing the Paperwork

Sanders’s cost-cutting plan is based on two premises about single-payer systems: that they allow for a massive reduction in administrative costs, and that they let the government bargain down the price of care.

Klein breezily dismisses the first source of cost reduction. He seemingly doubts such a thing is even possible (the plan “relies mainly on vague ‘administrative’ savings”) and insists that, in any case, “the real way single-payer systems save money isn’t through cutting administrative costs.”

Yet he seems to have been working from a different set of facts when he wrote his 2007 tour of the world’s health systems.

Single-payer systems are also better at holding down administrative costs. A 2003 study in the New England Journal of Medicine found that the United States spends 345 percent more per capita on health administration than our neighbors up north. This is largely because the Canadian system doesn’t have to employ insurance salespeople, or billing specialists in every doctor’s office, or underwriters. Physicians don’t have to negotiate different prices with dozens of insurance plans or fight with insurers for payment. Instead, they simply bill the government and are reimbursed.

When 2007-era Ezra Klein wrote this, he was not getting carried away by youthful idealism; he was just reporting the consensus among experts.

For example, a frequent expert source for Klein over the years, Harvard health economist David Cutler, who served as Barack Obama’s top health policy advisor in the 2008 campaign, published new research in 2011 comparing administrative costs in the US and Canada, and found that while the American system employs 2.2 administrative workers per physician, Canada has only 1.1.

Cutler’s conclusion: “Perhaps the most troubling difference between the U.S. and Canadian healthcare systems is the differential amount spent on administration . . . There are few other areas of the U.S. economy where waste is so apparent and the possibility of savings is so tangible.”

$1000 deductible

After inexplicably dismissing the possibility of administrative savings, Klein moves on to Sanders’s other cost-cutting plank: government bargaining. The core of Klein’s argument is laid out here:

The real way single-payer systems save money isn’t through cutting administrative costs. It’s through cutting reimbursements to doctors, hospitals, drug companies, and device companies. And Sanders gestures towards this truth in his plan, saying that “the government will finally have the ability to stand up to drug companies and negotiate fair prices for the American people collectively.”

But to get those savings, the government needs to be willing to say no when doctors, hospitals, drug companies, and device companies refuse to meet their prices, and that means the government needs to be willing to say no to people who want those treatments. If the government can’t do that — if Sanders is going to stick to the spirit of “no more fighting with insurance companies when they fail to pay for charges” — then it won’t be able to control costs.

Klein’s whole argument is rooted in this rhetorical device — the concept of “Saying No.” And that sounds like a very serious, very responsible thing to say.

Yet, from top to bottom, the argument amounts to a spurious conflation of two very distinct kinds of “Saying No” — joined to a series of factually wrong claims about existing single-payer systems, and some baffling logic thrown in for measure. Parts of it are not much more than double-talk.

Though dressed up to look like a policy critique of Sanders’s health care plan, Klein’s piece, when stripped of its tangle of confusions, is just another partisan polemic against the Sanders campaign itself.

How Single-Payer Really Saves Money

The single most important fact to know about health care costs is this: by definition, they equal the price of health care times the number of health care services delivered. So they can only be reduced if there’s either a reduction in the average price of a service, or a drop in the number of health care services provided (or some combination of the two).

$2000 deductible

Single-payer health systems vary greatly among one another. But their lower costs relative to the US are, in pretty much all cases, overwhelmingly due to lower prices per service — not fewer services per person.

That was the point of Princeton health economist Uwe Reinhardt’s now-classic 2003 coauthored article in the specialist journal Health Affairs. The title says it all: “It’s the Prices, Stupid: Why The United States Is So Different From Other Countries.”

Reinhardt and his coauthors analyzed a range of data from thirty OECD countries — not just national health spending, but the actual numbers of physicians, nurses, hospital beds, length of hospital stays, high-tech machines, and cutting-edge procedures in each country, per capita.

Their conclusion, from the abstract:

The data show that the United States spends more on health care than any other country. However, on most measures of health services use, the United States is below the OECD median. These facts suggest that the difference in spending is caused mostly by higher prices for health care goods and services in the United States.

And although the authors themselves only analyzed aggregate statistics, they also made use of an earlier study by the McKinsey Institute (carried out under the direction of Kenneth Arrow and Martin Bailey) that gathered particularly revealing micro-level data from individual hospitals in the US, UK, and Germany.

Using those data, Arrow, Bailey, and their German partners were able to break down the cost of individual hospital disease treatments (diabetes, breast cancer, lung cancer, etc.) into separate input cost components (physicians, pharmaceuticals, administration, etc.), and then divide each input cost into its price component and quantity component.

The results are summarized in the charts below:

MGI US UK Germany health care costs

There’s a lot going on in these charts, but what they show can be summarized in a few sentences.

US hospitals spent 66 percent more than those in Germany when treating the same diseases. Yet those hospitals employed fewer physicians, dispensed fewer prescriptions, and treated fewer acute cases per patient than the German hospitals.

Rather than the result of Germany saying “no” to health consumers (i.e. patients), its lower costs were entirely attributable to saying “no” to producers, by paying them lower prices. The US-Germany cost difference broke down as follows: lower physician wages (20 percent of the difference), lower drug prices (5 percent), lower administrative expenses (37 percent), and lower prices for acute care treatments (40 percent). (The remainder, 27 percent, is an unexplained residual.)

(Do not be misled by the seemingly small percentage accounted for by drug prices — the study looked only at hospital spending. More than 70 percent of drug purchases take place outside of hospitals, so national drug costs loom much larger as a share of total national health spending — and thus of single-payer savings — than their share of hospital costs alone would suggest.)

The facts were a bit different for the UK, but qualitatively the same. Unlike Germany, it did use slightly fewer doctors and acute services than the US. But its total spending was even lower than Germany’s (46 percent of the US level, rather than 60 percent for Germany), and 87 percent of the UK-US difference was still due to lower prices and overhead, rather than input use.

So why are prices so much higher in the United States? Let’s let 2007-era Ezra Klein explain it:

Canada’s is a single-payer, rather than a socialized, system. That means the government is the primary purchaser of services, but the providers themselves are private. (In a socialized system, the physicians, nurses, and so forth are employed by the government.)

The virtue of both the single-payer and the socialized systems, as compared with a largely private system, is that the government can wield its market share to bargain down prices — which, in all of our model systems, including the [Veterans Health Administration], it does.

A particularly high-profile example of how this works is Canadian drug reimportation. The drugs being bought in Canada and smuggled over the border by hordes of lawbreaking American seniors are the very same pharmaceuticals, made in the very same factories, that we buy domestically. The Canadian provinces, however, bargain down the prices (Medicare is barred from doing the same) until we pay 60 percent more than they do.

And how does that square with what Klein is saying today? Well, let’s recall his new argument, quoted above:

But to get those savings, the government needs to be willing to say no when doctors, hospitals, drug companies, and device companies refuse to meet their prices, and that means the government needs to be willing to say no to people who want those treatments. If the government can’t do that — if Sanders is going to stick to the spirit of “no more fighting with insurance companies when they fail to pay for charges” — then it won’t be able to control costs.

This is the crucial point where Klein subtly conflates two very different kinds of “saying no”: the use of government bargaining power to say “no” to producers, by insisting on lower prices than the market would otherwise bear; and the government’s saying “no” to patients, by declining to pay (or fully pay) for services.

Let’s walk through how these two kinds of “saying no” play out in a particular medical example. I’ll use France — “the world’s best health care system,” according to Klein in his 2007 survey — as the comparison case.

The bestselling blockbuster drug on the US market is Humira, an anti-inflammatory biologic manufactured by Abbott Laboratories and approved by the FDA in 2008. Humira is classified as a “fourth-tier drug” (a cutting-edge specialty drug); it’s used for inflammatory conditions like rheumatoid arthritis and Crohn’s disease. It goes without saying that these can be awful and stressful illnesses to live with.

Currently the US retail price of Humira (2 syringes of 40mg/0.8ml) is around $3,500. That’s how much you’ll have to pay for the drug if you don’t have insurance. Good luck.

[All employer health plan data in this section is from the Kaiser Foundation’s 2015 Employer Health Benefits Survey.]

But what if you do have insurance? (And remember, 27 million will still be left uninsured when Obamacare is fully implemented.) Well, you might be among the 15 percent of workers with employer-provided insurance whose plans nevertheless don’t cover specialty drugs at all. If so, again, you’re out of luck.

Or you might be one of the 34 percent of employer-covered workers who face “co-insurance” for fourth-tier drugs, which means you’ll have to pay a certain percentage of the drug’s cost. The average co-insurance rate for these workers is 32 percent. So, absent any overriding plan provisions, the Humira would cost you $1,120.

Then there are the 40 percent of covered workers whose plans charge co-payments for fourth-tier drugs, rather than co-insurance — a fixed dollar amount, rather than a percentage of the cost. The good news here is that the average copayment is $93. (Though, of course, some plans have much higher copayments.) That doesn’t sound so bad, right?

Don’t get too excited, though. After all, you might be one of the 12 percent with a separate prescription drug deductible, which means you have to foot the entire bill until you reach a certain threshold. The average drug deductible is $231 per year — but, again, your mileage may vary considerably. And although your insurance will kick in once you’ve paid that much, in almost all cases you’ll still have to cough up co-payments or co-insurance.

And don’t forget, you’re also paying premiums every month — $521 for single coverage on average. That’s more than 20 percent of the average wage for single, childless workers with employer insurance.

And that’s not all. Almost half of employer plans that cover specialty drugs employ a variety of additional special strategies for “saying no” when it comes to fourth-tier medicines. Some have an additional cost-sharing tier for these drugs. Others impose “tight limits on the number of units administered at a single time,” or mandate “step therapies,” where they make you take cheaper treatments before they’ll pay for the expensive drug  — even if your doctor is sure it’s the best one for you.

Then there’s the infinite variety of “utilization management programs” that appear the instant you request such drugs: special surveillance regimes that find creative and innovative ways of making sure you don’t splurge too much on your life-saving medicine. Often these make people’s lives a living hell.

That, in a nutshell, is how we in America say “no.”

The Big “No”

Now let me walk through the same scenario as it would play out in France.

When the French government says “no,” it says so first and foremost to Abbott Laboratories.

The French equivalent of the “retail” drug price is called the prix public, or public price — the sum that Abbott is actually paid for the drug, plus sales tax. The public price of Humira in France (same dose, same strength) is not $3,500 (as it is here) but €940.90 ($1,028).

Why the difference? Here’s an explainer from the website of a French online pharmacy directory:

The price of medications covered by national insurance is not a free-market price, it is set partly by the Economic Committee for Medical Products (ECMP), after negotiations with the manufacturing pharmaceutical laboratory. In case of disagreement, the ECMP, which is a government body, has the final say.

In reality, though, no one in France pays even $1,028. National insurance covers, at minimum, 65 percent of the public price. Thus, the most a French patient would pay for Humira is $360.

Now, that’s still a lot of money for a person of modest means. But we’re not done yet. Patients who need drugs to treat serious, chronic illnesses like diabetes, hypertension, or cancer don’t have to pay a thing. A full 6.8 percent of the French population fall into this category, and another 1.7 percent are exempted for other reasons (newborns, pregnant women, the disabled, nursing home residents, etc.).

And, as it happens, rheumatoid arthritis and Crohn’s disease, two of the main chronic conditions Humira is used to treat, appear on the list of diseases that qualify for an exemption.

So let’s apply Klein’s “saying no” formula to this example. Suppose you are French, and you take Humira. But you’re not one of the people who qualify for any exemptions. (Though I suspect there are not, in fact, many such patients when it comes to this particular drug.)

In other words, you’re one of the people the French government is saying “no” to. Yours is the “no” that Klein is keen to stress.

But the other “no” — the much more significant “no” — is the ultimatum the French government already issued to Abbott Laboratories long before you, the patient, were ever prescribed the drug.

How much bigger is this “no”?

The “no” imposed on Abbott saved French taxpayers about $2,500 per Humira prescription – the difference between the “market price” (i.e. the US retail price) and the price fixed by the French Health Ministry. By comparison, the “no” handed down to you, the patient, requiring you pay 35 percent, saved taxpayers only an additional $360.

By this (admittedly partial) reckoning, more than 87 percent of the taxpayer savings generated by France’s “Saying No Apparatus” (as it were) came out of the pockets of Abbott’s shareholders. Only 13 percent came out of the patient’s.

Yet Klein’s article systematically obscures the distinction between the two, while making it seem that Sanders’s plan, out of some kind of populist irresponsibility, chose to forego the main sources of real-world single-payer cost containment. In fact, the reverse is true: it was Klein who was doing that.

And this logic is by no means limited to the example of pharmaceuticals. Every US health-provider industry is riddled with such rents, which get squeezed out in single-payer systems. Consider that the median annual wage for a US dentist is $150,000, even though the median electrical engineer makes less than $90,000. Why in the world should that be? In Britain, a dentist at the midpoint of the NHS pay scale makes $92,000.

But I haven’t even gotten to the weakest parts of Klein’s piece. Let me briefly note a few.

He claims that “Sanders’s effort to fund a universal health care system so heavily on the backs of the wealthy would be unprecedented,” and contrasts the candidate’s approach with that of European countries, which “tend to pay for their health care systems through more broad-based, economically efficient taxes like VATs.”

But he offers no evidence for this. In fact, 87 percent of the funding for Sanders’s plan comes from broad-based income and payroll taxes, only 13 percent from taxes targeting the wealthy. Most European countries fund their systems through general tax revenues, which, likewise, mix broad taxes like the VAT with progressive income and wealth taxes. Klein clearly made no effort to check if his claim was true.

At one point, Klein tries to see how far he can get by simply redefining the term “single-payer”:

Technically, a single-payer system is a system with, well, a single payer. Private insurers are outlawed — otherwise, it would be a multi-payer system. But the term is often used more loosely than that, and many systems that get mentioned during discussions of single-payer, like the French system, include various kinds of supplementary, private insurance that people generally purchase.

That line could have used a fact-checker. In fact, there are no national single-payer systems that outlaw private insurance, for better or worse. (Or at least none among the usual “model” systems — or any of the countries profiled in last year’s Commonwealth Fund survey.) In Canada, around 70 percent have private insurance. In Denmark’s socialized system, 40 percent do.

In fact, no health care system in the world, or at least the rich world, is actually “single-payer” on Klein’s definition — they’re all “multi-payer systems.” In Canada, 29 percent of health spending comes from private sources. In Sweden, the number is 16 percent. Ironically, the system with the lowest share of privately sourced spending — that of the Netherlands (12 percent) — mainly channels funds through private insurers. Nobody has ever thought of it as a single-payer system.

But perhaps the biggest elephant in the room for Klein’s argument has Hillary Clinton’s name on it. After all, a centerpiece of the health care plan she’s now touting is a promise to repeal the law that forbids Medicare from negotiating drug prices with manufacturers. She claims that under her plan, Medicare will “use its leverage with more than 40 million enrollees to negotiate and drive down drug and biologic prices for seniors and others in the program.”

But wait — according to Klein, isn’t such bargaining only supposed to work if the government is willing to “say no”? To drop coverage for drugs whose manufacturers refuse to meet the government’s price?

Which drugs will Hillary drop from Medicare? Which seniors will lose coverage? Which diseases will go untreated? What about acupuncture? What about death panels? Surely this can’t be a serious plan either, on Klein’s analysis.

Lessons From Bevan

There is, of course, room for reasonable debate about Bernie Sanders’s health care plan. It’s only eight pages long — just like the document Obama released in 2007. It explains how it’s paid for, but offers no detailed accounting of how it arrived at its numbers. And it had to make specific projections about cost containment without much hard data to go on.

It also doesn’t spell out which categories of spending, if any, would still be privately financed, though  even the most socialized systems, for better or worse, fund their budgets with a small but significant fraction of private spending. It can fairly be said that the plan glosses over the most controversial issues that inevitably arise in any single-payer system.

In other words, Bernie Sanders released a campaign document, not a blue-ribbon report from a panel of experts.

We might recall the experience of Aneurin Bevan, the father of Britain’s NHS and hero of the Labour left. Despite Britain’s bankruptcy after the war, he managed to push through his dearly held vision of free care at the point of service — though doing so required an arduous standoff with the nation’s doctors groups, of whom he famously said he had “stuffed their mouths with gold.”

In 1951, he resigned from the Labour government in protest: he couldn’t abide new prescription fees for dentistry and eyeglasses. That would be only the first of many compromises of the NHS over the years. Nevertheless, seven decades later, the NHS is still there and still beloved.

Base Management

Let’s return to the great Obama-Clinton health-wonk war of 2007. As Matt Yglesias was dismissing demands for specifics, many other health policy pundits were expressing serious reservations about Obama’s proposal, which seemed to glide breezily past the most knotty issues involved in setting up an insurance-exchange-based system.

One of those pundits was Ezra Klein.

Recall that the plan Obama campaigned on included no individual mandate to buy insurance — even though policy experts all agreed that, without it, a disastrous actuarial death spiral would ensue, given the subsidies and insurance regulations that formed the plan’s centerpieces.

But Obama didn’t just irresponsibly exclude a mandate from his plan. He then went on to bait Hillary Clinton in the primaries about the mandate that she (“responsibly”) had included in her own plan — scaring voters with talk of the government “forcing you to buy insurance” and “penalizing you” if you didn’t. All of which, of course, turned out to be central features of the Affordable Care Act he later signed.

This was disturbing to many liberal pundits. A disgusted Paul Krugman condemned Obama’s “cheap shots” and “mudslinging.”

Ezra Klein basically agreed. He ran a stinging critique of Obama’s health plan in the American Prospect, titled “A Lack of Audacity,” that lamented “a politician who still hasn’t quite fulfilled the promise of his appeal.”

Klein was especially blunt about Obama’s disingenuousness in calling his plan universal when it clearly was anything but (due to the absence of a mandate). “There is perhaps no more surprising fact about Obama’s plan than that it is not universal,” Klein wrote. “It is certainly sold as if it is. In his speech unveiling the proposal, Obama bragged that, ‘[m]y plan begins by covering every American.’ But it doesn’t. To say otherwise is rhetorical overreach, the appropriation of a popular and broadly-supported goal without an attendant mechanism for achieving it.”

Yet despite all this, Klein made it perfectly clear that this little quarrel was all in the family. Obama’s plan wasn’t irredeemable, any more than the candidate himself. Klein took care to make that plain throughout: “Make no mistake: There is much to praise in the plan. . . . it’s a promising concept. . . . If passed, our polity would be better, our people would be healthier, and our finances would be more secure. . . . All the ingredients are in place for this to be a great plan. . . . [T]here is time yet. And he is so very close.”

Compare that with Klein’s take-no-prisoners trashing of Sanders’s plan today, and its total absence of such saving words.

I think these contradictions are symptoms of the larger tremors now vibrating through the Democratic Party as it tries, haltingly, to adjust to the new world of polarized, ideologically sorted parties — a world where “base mobilization” has replaced “swing voter persuasion” as the only viable strategy to win elections.

The problem is that whipping up the base always holds an element of risk: once you start to whip them up, they might actually believe what you’re saying.

Again, recall how the 2008 primaries unfolded. No one expected “universal coverage” to become the central issue in the Democratic race. It happened almost by accident. One day, John Edwards, an underdog candidate grasping for support wherever he could find it, announced a reform plan that he promised could one day “lead to” single-payer. That electrified the small but fervent corps of single-payer activists within the primary electorate, forcing Obama and Clinton to come up with their own plans.

Obama, in turn, claimed that his plan, too, could lead to single-payer — that, in fact, he had always believed in single-payer in principle. When the details of Obama’s plan were finally released, Klein (then a single-payer fan) actually cited the absence of “a public insurance option capable of serving as the seed of single-payer” as one of its major shortcomings.

All this tantalizing rhetoric about single-payer was certainly helpful in motivating the base to turn out that November. And then, when the congressional sausage machine got going, it was invaluable in getting the base to swallow a series of increasingly unpalatable compromises — until finally the bait itself was tossed away and the public option declared dead.

The predicament the party finds itself in now, judging by the new poll numbers out of Iowa, is that it faces a base that took it at its word. And now sites like Vox — key actors in what might be called the party’s “base management system” — are forced to spring into action to patch things up. But it’s not easy to hold up both halves of that maxim, enunciated by famous liberal Immanuel Kant, regarding the proper attitude of a subject toward his sovereign: criticize, but obey.

Right now, the system may look a little unsteady. And maybe it is, we’ll see. Still, if I were the base — the liberal base, the progressive base, the radical base — I wouldn’t get too complacent.

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